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17 November 2016
Member of Large-Scale ‘ATM Skimming’ Scheme Pleads Guilty to Bank Fraud ConspiracyRead the Press Release
NEWARK, N.J. – A native of Romania who was arrested in Spain and extradited to the United States today admitted his role in a conspiracy to steal bank account information from thousands of customers by installing secret card-reading devices and pinhole cameras on ATMs throughout New Jersey, New York, Connecticut, Florida, and elsewhere, U.S. Attorney Paul J. Fishman announced.
Alin Carabus, 42, pleaded guilty before U.S. District Judge William J. Martini in Newark federal court to Count One of an indictment charging him with conspiracy to commit bank fraud.
According to documents filed in this and other cases as well as statements made in court:
Carabus admitted he was part of a vast “ATM skimming” scheme that stole bank account information by installing secret card-reading devices on ATMs throughout New Jersey, New York, Connecticut, Florida, and elsewhere. The scheme, which ultimately defrauded Citibank, TD Bank, Wells Fargo, and multiple other financial institutions out of at least $5 million and impacted thousands of customers, was organized by Marius Vintila, 34, also a native of Romania.
Vintila and Bogdan Radu, 34, designed and constructed sophisticated card-reader devices and pinhole camera panels capable of reading and storing customers’ bank account information and personal identification numbers. Carabus and others then secretly installed devices onto bank ATMs and removed them a few days later after they had recorded customer bank account information as customers performed routine bank transactions at ATMs.
The stolen data was used to create thousands of fraudulent ATM cards, which Carabus and others used to withdraw millions of dollars from customers’ bank accounts.
The conspiracy to commit bank fraud charge carries a maximum potential penalty of 30 years in prison and a $1 million fine. Sentencing is scheduled for Feb. 23, 2017.
The ATM skimming operation in which Carabus participated is one of the largest ever uncovered by law enforcement. To date, 15 of the 16 individuals that have been charged in connection with this scheme, including Carabus, Vintila and Radu, have been convicted.
U.S. Attorney Fishman credited special agents of the U.S. Secret Service, Newark Field
Office, under the direction of Special Agent in Charge Mark McKevitt, and special agents of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), under the direction of Special Agent in Charge Terence S. Opiola in Newark, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorneys Rahul Agarwal of the Special Prosecutions Division and David M. Eskew of the Criminal Division in Newark.
Defense Counsel: Joseph M. Corazza Esq., Sparta, New Jersey
Meisum Bakery, Inc. and Owner Plead Guilty to Food Stamp FraudRead the Press Release
BOSTON – Meisum Bakery, Inc. and its owner, Xi Xian Lei, pleaded guilty today in U.S. District Court in Boston in connection with a $740,000 food stamp fraud scheme that Lei and his employees operated out of a Chinatown bakery.
Both Meisum Bakery, Inc. and Lei pleaded guilty to one count of conspiracy to commit SNAP (Supplemental Nutritional Assistance Program) benefits fraud and two counts of SNAP fraud. U.S. District Court Judge Nathaniel M. Gorton scheduled sentencing for Feb. 22, 2017.
SNAP, formerly known as the Food Stamp Program, administered by the U.S. Department of Agriculture (USDA), provides eligible households with government subsidies for food and allows holders to exchange their SNAP benefits for food at authorized retail food stores.
From about October 2010 through April 2012, Lei and bakery employees purchased SNAP benefits from legitimate SNAP beneficiaries for cash at a discounted value of approximately fifty cents for every SNAP dollar; however, neither Meisum Bakery, Inc. nor Lei was authorized to accept SNAP benefits as payment for goods at the bakery. Then, bakery employees and Lei redeemed the SNAP benefits by using the beneficiaries’ Electronic Benefit Transfer (EBT) cards to buy goods and earn credit at stores that were authorized to accept SNAP benefits.
During the course of the conspiracy, Meisum Bakery, Inc. and Lei defrauded the USDA of approximately $740,000 in SNAP funds.
The charge of conspiracy provides for a sentence of no greater than five years in prison and three years of supervised release, and for a corporation, no greater than five years of probation and a fine of $500,000. The charge of SNAP fraud provides for a sentence of no greater than five years in prison and three years of supervised release, and for a corporation, no greater than five years of probation and a fine of $10,000. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz; William G. Squires, Special Agent in Charge of the U.S. Department of Agriculture, Office of Inspector General, Office of Investigations, Northeast Region; Joel P. Garland, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston; and Boston Police Commissioner William Evans, made the announcement today. Assistant U.S. Attorney Giselle J. Joffre of Ortiz’s Major Crimes Unit is prosecuting the case.
McAlester Man Sentenced to 84 Months for Methamphetamine DistributionRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that LUKE AUSTIN HOMER, age 36, of McAlester, Oklahoma, was sentenced to 84 months imprisonment for POSSESSION WITH INTENT TO DISTRIBUTE MORE THAN 5 GRAMS OF ACTUAL METHAMPHETAMINE, in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(B).
The Indictment alleged that on or about March 5, 2016, in the Eastern District of Oklahoma, the defendant, LUKE AUSTIN HOMER, did knowingly and intentionally possess with intent to distribute more than 5 grams of actual methamphetamine, a Schedule II controlled substance.
The charge arose from an investigation by the Pittsburg County Sherriff’s Office, and the Drug Enforcement Administration.
The Honorable James H. Payne, District Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, presided over the hearing. The defendant will remain in the custody of the United States Marshals Service pending transportation to the designated federal facility at which, the nonparoleable sentence will be served.
Assistant United States Attorney Timothy Hammer represented the United States.
Man Convicted of Threatening to Take the Life of the President of the United StatesRead the Press Release
RENO, Nev.—A man was convicted on Wednesday for threatening to take the life of the President of the United States, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.
“Threatening to take the life of the nation’s Commander in Chief will be taken seriously and investigated and prosecuted to the fullest extent of the law,” said U.S. Attorney Bogden.
Steven Eugene Ford, aka Job Ford, aka Eleazar Melchizedek, 50, was found guilty of making a threat to take the life of the President of the United States. Ford was charged by a grand jury on March 9, 2016. United States District Judge Howard D. McKibben presided over the jury trial.
According to court documents, on or about March 1, 2016, Ford told a White House telephone operator that “I’m going to kill that president. I hate him.” During an interview, Ford admitted to making the threats.
Sentencing is scheduled for Feb. 7, 2017. Ford faces the statutory penalty of five years in prison and a $250,000 fine.
The case was investigated by the U.S. Secret Service, and prosecuted by Assistant U.S. Attorney Brian L. Sullivan.
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Man Admits to Receiving Child Pornography on the InternetRead the Press Release
Contact Person: Bill Day (803) 929-3000
Columbia, South Carolina ---- Acting United States Attorney Beth Drake stated today that Richard J. Probst, age 65, formerly of Columbia, South Carolina has entered a guilty plea in federal court in Columbia, to receiving child pornography that had traveled in foreign commerce by computer, a violation of 18 U.S.C. § 2252A. United States District Judge Mary Geiger Lewis accepted the guilty plea and will impose sentence after she has reviewed the presentence report which will be prepared by the U.S. Probation Office.
Evidence presented at the change of plea hearing established that Probst had been collecting child pornography since 1986. Probst was caught when the German Federal Police reported to the U.S. Department of Homeland Security that they had discovered a Peer to Peer Network that involved trading child pornography. The investigation revealed that Probst was one of the individuals receiving child pornography from the Network. Ms. Drake stated the maximum penalty for receiving child pornography is imprisonment for 20 years plus Supervised Release for life and/or a fine of $250,000.
The case was investigated by agents of the Department of Homeland Security and the German Federal Police Department. Assistant United States Attorney William E Day, II of the Columbia office is prosecuting the case.#####
Louisiana Check Cashers Sentenced for Conspiracy and Filing False Income Tax ReturnRead the Press Release
Agree to Forfeit $4.1Million
A Kenner, Louisiana couple was sentenced today for crimes related to the operation of their check cashing business, VJ Discount Inc., announced Principal Deputy Assistant Attorney General Caroline D. Ciraolo, head of the Justice Department’s Tax Division, and U.S. Attorney Kenneth A. Polite for the Eastern District of Louisiana.
Susantha Wijetunge, aka VJ, 52, was sentenced by U.S. District Court Judge Lance M. Africk of the Eastern District of Louisiana to serve 44 months in prison and his spouse, Manula Wijetunge, aka Manu, 48, was sentenced by Judge Africk to serve three years of probation. The Wijetunges owned VJ Discount Inc., a Louisiana corporation that operated a convenience store and check cashing business in Kenner. Susantha Wijetunge, VJ Discount Inc. and others cashed, for an inflated fee, fraudulently obtained tax refund checks for multiple co-conspirators. These transactions often involved multiple checks and tens of thousands of dollars. In an attempt to conceal this illegal activity, Susantha Wijetunge and others failed to file, or filed false, required currency transaction reports with the government.
Susantha Wijetunge also filed multiple false individual and corporate income tax returns that underreported income. The Wijetunges admitted that VJ Discount Inc. had third party check deposits totaling more than $59 million in 2011; $47 million in 2012; and $66 million in 2013. Despite this large volume of business, the Wijentunges’ individual income tax returns reported total income of less than $100,000 per year.
In March 2016, Susantha Wijetunge pleaded guilty to conspiring to defraud the United States and to committing mail and wire fraud, and Manula Wijetunge pleaded guilty to willfully filing a false 2013 individual income tax return.
In addition to the term of prison imposed, Susantha Wijetunge was ordered to serve three years of supervised release, pay a fine of $750,000 and pay $562,500 in restitution to the IRS. In addition to the term of probation imposed, Manula Wijetunge was ordered to pay a fine of $250,000 and $208,125 in restitution to the IRS. The Wijetunges were ordered to forfeit $4.1 million.
Principal Deputy Assistant Attorney General Ciraolo and U. S. Attorney Polite commended special agents of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations and IRS – Criminal Investigation, who conducted the investigation, and Assistant U.S. Attorneys Hayden Brockett and David Haller and Trial Attorney Michael Hatzimichalis of the Tax Division, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Louisiana Check Cashers Sentenced for Conspiracy and Filing False Income Tax ReturnRead the Press Release
WASHINGTON – A Kenner, Louisiana couple was sentenced today for crimes related to the operation of their check cashing business, VJ Discount Inc., announced Principal Deputy Assistant Attorney General Caroline D. Ciraolo, head of the Justice Department’s Tax Division, and U.S. Attorney Kenneth A. Polite for the Eastern District of Louisiana.
Susantha Wijetunge, aka VJ, 52, was sentenced by U.S. District Court Judge Lance M. Africk of the Eastern District of Louisiana to serve 44 months in prison and his spouse, Manula Wijetunge, aka Manu, 48, was sentenced by Judge Africk to serve three years of probation. The Wijetunges owned VJ Discount Inc., a Louisiana corporation that operated a convenience store and check cashing business in Kenner. Susantha Wijetunge, VJ Discount Inc. and others cashed, for an inflated fee, fraudulently obtained tax refund checks for multiple co-conspirators. These transactions often involved multiple checks and tens of thousands of dollars. In an attempt to conceal this illegal activity, Susantha Wijetunge and others failed to file, or filed false, required currency transaction reports with the government.
Susantha Wijetunge also filed multiple false individual and corporate income tax returns that underreported income. The Wijetunges admitted that VJ Discount Inc. had third party check deposits totaling more than $59 million in 2011; $47 million in 2012; and $66 million in 2013. Despite this large volume of business, the Wijentunges’ individual income tax returns reported total income of less than $100,000 per year.
In March 2016, Susantha Wijetunge pleaded guilty to conspiring to defraud the United States and to committing mail and wire fraud, and Manula Wijetunge pleaded guilty to willfully filing a false 2013 individual income tax return.
In addition to the term of prison imposed, Susantha Wijetunge was ordered to serve three years of supervised release, pay a fine of $750,000 and pay $562,500 in restitution to the IRS. In addition to the term of probation imposed, Manula Wijetunge was ordered to pay a fine of $250,000 and $208,125 in restitution to the IRS. The Wijetunges were ordered to forfeit $4.1 million.
Principal Deputy Assistant Attorney General Ciraolo and U. S. Attorney Polite commended special agents of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations and IRS – Criminal Investigation, who conducted the investigation, and Assistant U.S. Attorneys Hayden Brockett and David Haller and Trial Attorney Michael Hatzimichalis of the Tax Division, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Lebanon County Man Indicted for Coercing A Minor to Perform Sex ActsRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Kerry Edward Tropasso, age 35, of Lebanon County, was indicted on November 16, 2016, by a federal grand jury on charges relating to the sexual abuse of children.
According to United States Attorney Bruce D. Brandler, the indictment alleges that Tropasso used a minor victim to transmit live visual depictions of the minor engaged in sexual activity; coercing and enticing the minor to engage in sexual activity; distributing images depicting the sexual abuse of a minor; and receiving obscene visual depictions of the sexual abuse of children.
This case was investigated by the United States Postal Inspection Service, the Pennsylvania State Police, with assistance from the Lancaster County Detectives Office and the Northern Lebanon Township Police Department. The case is being prosecuted by Assistant United States Attorney Daryl Bloom.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
Indictments are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law for these offenses life imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Las Vegas Illusionist Pleads Guilty to Possession, Receipt, and Distribution of Child PornographyRead the Press Release
LAS VEGAS, Nev.—A former Las Vegas illusionist pleaded guilty today before U.S. District Chief Judge Gloria M. Navarro to possession, receipt, and distribution of child pornography, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.
“The risk to our children from sexual predators is constant and continuing,” said U.S. Attorney Bogden. “We will continue to aggressively investigate and prosecute these disturbing cases and dangerous defendants as part of our implementation of the Project Safe Childhood initiative throughout Nevada. The Court may consider any counts dismissed under the Plea Agreement and all other relevant conduct, whether charged or uncharged, in determining the appropriate sentence to be imposed in this case.”
Jan Rouven Fuechtener, aka Lars Schmidt, 39, a citizen of Germany, was indicted on March 30, 2016. Sentencing has been scheduled for March 16, 2017, before Chief Judge Navarro.
According to court documents and admissions made in court, on August 2015, a Task Force Officer from the FBI Buffalo Field Office Child Exploitation Task Force in New York, operating in an undercover capacity, was accepted as a friend by user name “Lars45” on GigaTribe, a peer-to-peer file sharing program. On Sept.14, 2015, the officer used the password previously supplied by Lars45 and was able to access and browse Lars45’s shared directories. The officer downloaded numerous files after observing file titles indicative of child pornography. On Jan. 21, 2016, during the execution of a search warrant at the defendant's residence in Las Vegas, law enforcement seized 38 devices throughout the residence. A forensic examination of the seized devices revealed that there were over 9,000 videos depicting children engaging in sexually explicit conduct. Fuechtener admitted that the Lars45 GigaTribe account belonged to him.
Fuechtener further admitted to using the Skype username “larusa22” to engage in chats to offer to distribute child pornography by sharing his GigaTribe Lars45 folder in exchange for a thing of value. Skype user account larusa22 is associated with an email address belonging to Fuechtener.
At the time of sentencing, Fuechtener will face a statutory maximum penalty of 20 years in prison for each count and a five year minimum mandatory on two counts.
The case was investigated by the FBI, and prosecuted by Assistant U.S. Attorneys Elham Roohani and Lisa C. Cartier-Giroux.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood and for information about internet safety education, please visit www.justice.gov/psc.
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Lanham Drug Dealer Sentenced to over 12 Years in Federal PrisonRead the Press Release
Greenbelt, Maryland – U.S. District Judge Theodore J. Chuang sentenced Gloria Patricia Taylor, age 52, of Lanham, Maryland today to 146 months in prison, followed by five years of supervised release, for conspiracy to distribute and possess with intent to distribute 1000 kilograms or more of marijuana, two counts of use of a communication device to facilitate narcotics trafficking, and possession with intent to distribute 100 kilograms or more of marijuana. Judge Chuang also entered an order requiring Taylor to forfeit $3.7 million. Taylor was convicted by a federal jury on April 28, 2016.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Karl C. Colder of the Drug Enforcement Administration - Washington Field Division.
According to evidence presented at her seven-day trial, on July 1, 2013, law enforcement officers intercepted three crates containing a total of approximately 630 kilograms of marijuana at a nationwide delivery company with a shipping office located in Maryland. All three crates were shipped from Tucson, Arizona. The crates were addressed to companies in in Landover and Lanham, Maryland. The bill of lading for the shipments described the contents as “Stone Group, Amethyst Stone,” and “Stone Group, Aragonite.” In total, the bales of marijuana from those three crates weighed over 1300 pounds, which evidence at trial showed was approximately $1.3 million dollars’ worth of marijuana.
According to trial evidence, records showed that at least 28 additional crates shipped from Arizona to those and other companies were sent from March 2011 through October 2013. The shipping company driver who delivered the packages testified that Taylor accepted delivery of and signed fictitious names for each of the crates (with the exception of 5 or so shipments, which were delivered to an associate of Taylor’s, at Taylor’s request), and that none of the crates were delivered to the addresses found on the bills of lading. Evidence at trial further showed that none of the delivery addresses on the bills of lading were in any way associated with any of the businesses. Taylor tipped the driver approximately $100 for each delivery.
Trial testimony showed that the driver first met Taylor when he attempted to deliver a crate to one of the companies. When the driver arrived at the address listed on the bill of lading, the individuals at that address did not accept the package. Shortly thereafter, Taylor contacted the driver and asked him to deliver the package to a location around the corner. Taylor arrived at the delivery spot with a U-Haul. Taylor requested that the driver become her regular delivery driver for all future deliveries. According to trial testimony, prior to each delivery, Taylor would contact the driver by telephone and inform him that the crates were arriving at the shipping company in Maryland. The day of the delivery, Taylor would call the driver to let him know where to make the delivery. When law enforcement intercepted the three crates in July 2013, shipping company personnel told the driver that drugs were found in the crates. The driver confronted Taylor, who apologized for getting him involved, and offered to pay the driver $10,000 to get the crate back and also offered him a new cell phone so that they could communicate. The driver refused the money and the cell phone and cut off all communication with Taylor. Taylor stopped using the shipping company.
The government’s evidence showed that Taylor traveled to Arizona during the same time period each of the shipments were shipped from Tucson, Arizona to Maryland. Even after Taylor stopped using the Maryland shipping company in July 2013, she continued to travel to and from Arizona and Maryland, renting a U-Haul within days of each return to Maryland, including in October 2013, January 2014, February 2014, April 2014, July 2014, and September 2014.
According to trial evidence, after Taylor returned to Maryland from Arizona on September 30, 2014, she rented a U-Haul van, which she drove to Washington, DC, and then back to her residence. On that same date, law enforcement executed a search warrant at Taylor’s residence and the U-Haul van. Law enforcement recovered 250 pounds of marijuana (approximately 130 kilograms) from a crate that Taylor was seen unloading from the U-Haul van, and nine cell phones from throughout the residence. In addition, within her master bedroom, law enforcement recovered additional marijuana, over $30,000 in cash, and drug ledgers which calculated Taylor’s sales and profit from her marijuana business.
The government’s evidence showed that, just between October 2012 and July 2013, Taylor shipped approximately 5,220 pounds (approximately 2,367 kilograms) of marijuana, worth approximately $5 million.
United States Attorney Rod J. Rosenstein praised the DEA for its work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Kelly O’Connell Hayes and Bryan E. Foreman, who prosecuted the case.
Konawa Woman Sentenced to 60 Months Probation, $45,000 Restitution for Theft of Government FundsRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that JOANNA MARY HARJO, age 63, of Konawa, Oklahoma, was sentenced to 5 years of probation, to be supervised by the United States Probation Office, and ordered to pay restitution to the United States Social Security Administration in the amount of $45,736.08 for THEFT OF GOVERNMENT FUNDS, in violation of Title 18, United States Code, Section 641.
The Information alleged that on or about September 2008, and continuing to, on or about March 2015, in the Eastern District of Oklahoma the Defendant, JOANNA MARY HARJO, concealed the true nature of her living arrangements and marital status from the United States Social Security Administration so that she could receive more Social Security Supplemental Security Income benefits than what she would have been eligible to receive, and thus, converted money belonging to the United States Social Security Administration to her own use or gain knowing it was not hers and intending to deprive the United States Social Security Administration of the use and benefit of this money.
The charge arose from an investigation by the United States Social Security Administration.
The Honorable James H. Payne, District Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, presided over the hearing.
Assistant United States Attorney Kristin Harrington represented the United States.
Kenel Man Sentenced for Conspiracy to Distribute a Controlled Substance and Prohibited Person in Possession of a FirearmRead the Press Release
United States Attorney Randolph J. Seiler announced that a Kenel, South Dakota, man convicted of Conspiracy to Distribute a Controlled Substance and Prohibited Person in Possession of a Firearm was sentenced on November 10, 2016, by U.S. District Judge Charles B. Kornmann.
Kelly Moore, age 39, was sentenced to 92 months of custody, followed by 3 years of supervised release, a $1,000 fine, and a $200 special assessment to the Federal Crime Victims Fund. In addition, two firearms found in Moore’s possession at the time of his arrest were ordered forfeited.
Moore was indicted by a federal grand jury on December 8, 2015. He pled guilty to both charges on August 22, 2016.
The conviction stems from a search warrant that was executed on Moore’s residence by Bureau of Indian Affairs police on July 22, 2015. Found during the search of the residence were two firearms, ammunition, prescription pills, drug packaging material, scales, and drug paraphernalia. In addition, Moore had 5 small baggies in his pocket, 4 of which contained Methamphetamine. Moore was placed under arrest and subsequently admitted to being involved in a conspiracy to distribute Methamphetamine across the Standing Rock Indian Reservation. As part of the conspiracy, Moore admitted to selling approximately 350 grams of Methamphetamine.
This case was investigated by the Bureau of Indian Affairs-Office of Justice Services, Standing Rock Agency. Assistant U.S. Attorney Troy R. Morley prosecuted the case.
Moore was immediately remanded to the custody of the Bureau of Prisons to begin serving his sentence.
Jury Renders Guilty Verdict in Heroin Overdose Death; Defendant Faces Mandatory Life SentenceRead the Press Release
Gregory J. Haanstad, U.S. Attorney for the Eastern District of Wisconsin, announced that on November 16, 2016, Donald S. Harden (age: 47) of Fort Atkinson, Wisconsin, was found guilty following a jury trial in federal court in Green Bay, Wisconsin, of conspiracy to distribute and possess with the intent to distribute heroin in violation of Title 21, United States Code, Sections 846 and 841(b)(1)(B). The jury also found beyond a reasonable doubt that the conspiracy involved 100 grams or more of heroin and that the heroin distributed by Harden resulted in the overdose death of Neenah, Wisconsin, resident Frederick J. Schnettler (age: 24) in September 2014.
The evidence at trial revealed that Harden purchased kilograms of heroin in Chicago, Illinois, and using a “stash house” in Watertown, Wisconsin, repackaged the heroin for distribution in the Fox Valley area and elsewhere. Throughout the late Spring and Summer of 2014, Harden would deliver heroin to mid-level distributors in the Fox Valley; those distributors in-turn would deal smaller amounts to numerous heroin users throughout the area.
On September 4, 2014, Harden arranged a meeting with one of his Fox Valley distributors at a retail parking lot in Waupun, Wisconsin. At that meeting, Harden gave 11 grams of heroin to one of his co-conspirators warning her “be careful with this stuff, it’s got bodies on it.” That heroin was later used by Schnettler and others, resulting in his death from “acute heroin toxicity” according to the Medical Examiner. Another overdose death linked to Harden’s heroin was discovered by Winnebago County Sheriff’s investigators days later.
Harden was convicted of the manufacture or delivery of cocaine in 2000 in Jefferson County Circuit Court, and manufacture or delivery of heroin in 2007 in Dane County Circuit Court.
Based on his prior felony drug convictions and the jury’s determination that he is responsible for the death of Frederick Schnettler, Harden faces a mandatory life sentence when he is sentenced by Chief Federal Judge William C. Griesbach in February 2017. He remains incarcerated pending that hearing.
The case was investigated by the Winnebago County Sheriff’s Office, Lake Winnebago Area Metropolitan Enforcement Group – Drug Unit, the City of Appleton Police Department, the Jefferson and Dodge County Drug Task Forces, the Oshkosh Police Department, the Fond du Lac County Medical Examiner’s Office, and the Wisconsin State Crime Laboratory. It is being prosecuted by Assistant United States Attorneys Daniel R. Humble and Andrew J. Maier.
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For further information contact:
Public Information Officer Dean Puschnig
(414) 297-1700
Jury Convicts St. Croix Man on Attempted Murder ChargesRead the Press Release
St. Croix, USVI B On November 15, 2016, after a five-day trial, a federal jury on St. Croix convicted Daniel Carino, 34, of St. Croix, Virgin Islands, of possession of a firearm during a violent crime, attempted murder and assault third degree, United States Attorney Ronald W. Sharpe announced today.
Evidence presented at trial established that on December 19, 2015, Carino encountered the victim at the Concordia garbage bin site in Frederiksted, St. Croix. An argument ensued during which Carino drew a firearm and shot the victim in the chest. Though shot, the victim wrestled the firearm away from Carino who then ran into his vehicle and drove away. Later that evening, the victim selected Carino from a photo array while at the emergency room. Police apprehended Carino at a festival event that night.
Carino faces a mandatory minimum sentence of ten years on the firearm possession charge and a maximum of life imprisonment, plus a maximum fine of $250,000. He also faces maximum sentences of 25 years and 5 years on the attempted murder and assault conviction, along with a fine of $500 to $3,000 on the assault conviction. A sentencing date has been set for March 16, 2016. Carino remains detained pending sentencing.
The case was investigated by the Virgin Islands Police Department and the Federal Bureau of Investigation and is being prosecuted by Assistant U.S. Attorney Alphonso Andrews, Jr.
Jury Convicts New Albany Man in Cocaine Traficking ConspiracyRead the Press Release
COLUMBUS, Ohio – A U.S. District Court jury convicted Oscar Collado-Rivera, 32, of New Albany, Ohio of conspiring with others to distribute nearly 200 kilograms of cocaine involving at least $4 million in U.S. currency over a six-month period in 2015.
U.S. Attorney Benjamin C. Glassman of the Southern District of Ohio, Timothy Plancon, Special Agent in Charge, U.S. Drug Enforcement Administration (DEA), Kathy A. Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation (IRS), and agencies in a state and local task force announced the verdict reached yesterday following a three-day trial before U.S. District Judge Michael H. Watson.
Evidence presented during the trial established that Collado-Rivera and others were responsible for arranging large shipments of cocaine from Mexico and Texas into the Columbus area.
“Collado-Rivera is the ninth defendant convicted out of 12 defendants charged in April,” U.S. Attorney Glassman said. “Disrupting the networks that bring illegal drugs into central Ohio requires tremendous cooperation by federal, state and local agencies.” Glassman noted that the three remaining defendants are believed to have fled the United States.
The jury convicted Collado-Rivera of one count of conspiracy to possess with intent to distribute more than five kilograms of cocaine, a crime punishable by a mandatory minimum ten years in prison and up to life. Judge Watson will determine the sentence following a pre-sentence investigation by the court. Task Force officers arrested Collado-Rivera in December 2015 based on a federal criminal complaint. He has been in custody since his arrest.
Glassman commended Franklin County Sheriff Zach Scott’s Office, the Ohio State Highway Patrol, and the investigators with police departments in Pickerington, Upper Arlington and Westerville who conducted the investigation, as well as Deputy Criminal Chief Michael Hunter and Appellate Chief Mary Beth Young, who represent the United States in prosecuting the case.
Judge Revokes Probated Sentence of Manager of Metal Recovery BusinessRead the Press Release
PLANO, Texas – A 61-year-old Quinlan, Texas man, who had originally received a probated sentence for negligently releasing an extremely hazardous substance into the air, has been sentenced to three months in prison to be followed by three months of home confinement, announced Acting U.S. Attorney Brit Featherston today.
U.S. Magistrate Judge Kimberly C. Priest-Johnson imposed the sentence November 15, 2016 on William “Bill” Lafon Musgrove, 61, after finding that Musgrove had violated the conditions of his probation by returning to the metal recovery business without the proper equipment or a permit. Musgrove originally pleaded guilty on August 7, 2013 to the offense of Negligent Release of an Extremely Hazardous Substance. On June 21, 2013, the United States Attorney’s Office for the Eastern District of Texas filed an information charging Musgrove with the offense. Musgrove admitted that in June of 2011, as the vice president and operations manager of Industrial Precious Metals Recovery Incorporated (IPMR), in Royse City, Texas, he allowed their metal recovery process to release Nitrogen Oxides, or “NOx” into the ambient air at ground level, through an open doorway, instead of utilizing the company’s air scrubber which was broken at the time. Musgrove admitted that he should have known that releasing NOx in that manner would place people in imminent danger of death or serious bodily injury. Fortunately, no actual injuries occurred.
Federal environmental regulations characterize Nitrogen Oxides as an “extremely hazardous substance.” At the time, the IPMR facility in Royse City was adjacent to other commercial facilities with employees that were present during the NOx emissions. The facility has since closed.
This case was investigated by the United States Environmental Protection Agency, Criminal Investigations Division, Region VI, Dallas, Texas, and the Texas Commission on Environmental Quality (TCEQ) Environmental Crimes Unit and prosecuted by Assistant U.S. Attorney Jim Noble.
Jacksonville Man Pleads Guilty to Soliciting and Paying for Live Molestation of Children over the InternetRead the Press Release
Jacksonville, Florida – United States Attorney A. Lee Bentley, III announces that Justin Laurence McKinley (49, Jacksonville) has pleaded guilty to sending notices over the Internet soliciting the live molestation of children for online viewing. He faces a mandatory minimum penalty of 15 years, up to 30 years, in federal prison and a potential life term of supervision.
According to court documents, in 2015, the FBI began an investigation into a website engaging in the exploitation and enticement of children to participate in sexual activity. The FBI identified several individuals located in the United States that were associated with this website. Further investigation revealed that several individuals in a foreign country were engaged in the molestation of young children for the purpose of broadcasting live streaming “sex shows” to online viewers who had paid a fee. The individuals were arrested and McKinley was identified as one of the individuals who paid to view these live streaming “sex shows.” Between January 2014 and December 2015, McKinley sent a total of 100 electronic fund transfers, totaling $31,415, to the individuals who molested the children in the “sex shows.”
On May 27, 2016, law enforcement officers executed a federal search warrant at McKinley’s residence. During an interview, McKinley admitted that he had solicited others to molest children and live stream video of the conduct to him, and he further admitted that he had recorded many of the sessions. The victims depicted in the streaming videos ranged in age from a newborn to an 8-year-old child. Forensic analyses of McKinley’s computer media revealed that a particular external hard drive contained at least 613 videos and 6,846 images depicting the sexual abuse of children.
This case was investigated by the Federal Bureau of Investigation, the Jacksonville Sheriff’s Office, and law enforcement authorities in several other countries. It is being prosecuted by Assistant United States Attorney D. Rodney Brown.
It is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
JPMorgan’s Investment Bank in Hong Kong Agrees to Pay $72 Million Penalty for Corrupt Hiring Scheme in ChinaRead the Press Release
JPMorgan Securities (Asia Pacific) Limited (JPMorgan APAC), a Hong Kong-based subsidiary of multinational bank JPMorgan Chase & Co. (JPMC), agreed to pay a $72 million penalty for its role in a scheme to corruptly gain advantages in winning banking deals by awarding prestigious jobs to relatives and friends of Chinese government officials.
Assistant Attorney General Leslie R. Caldwell of the Criminal Division, U.S. Attorney Robert L. Capers of the Eastern District of New York and Assistant Director in Charge William F. Sweeney Jr. of the FBI’s New York Field Office made the announcement.
“The so-called Sons and Daughters Program was nothing more than bribery by another name,” said Assistant Attorney General Caldwell. “Awarding prestigious employment opportunities to unqualified individuals in order to influence government officials is corruption, plain and simple. This case demonstrates the Criminal Division’s commitment to uncovering corruption no matter the form of the scheme.”
“U.S. businesses cannot lawfully seek to gain a business advantage by corruptly influencing foreign government officials,” said U.S. Attorney Capers. “The common refrain that this is simply how business is done overseas is no defense. In this case, JPMorgan employees designed a program to hire otherwise unqualified candidates for prestigious investment banking jobs solely because these candidates were referred to the bank by officials in positions to award business to the bank. In certain instances, referred candidates were hired with the understanding that the hiring was linked to the award of specific business. This is no longer business as usual; it is corruption.”
“Creating a barter system in which jobs are awarded to applicants in exchange for lucrative business deals is a corrupt scheme in and of itself,” said Assistant Director in Charge Sweeney. “But when foreign officials are among those involved in the bribe, the international free market system and our national security are among the major threats we face. Those engaging in these illegal acts abroad may think they're out of sight and out of mind, but they're wrong. The FBI has recently established three dedicated international corruption squads to combat this type of quid pro quo, and we'll use all resources at our disposal to uncover and put an end to these crimes.”
According to JPMorgan APAC’s admissions, beginning in 2006, senior Hong Kong-based investment bankers set up and used a “client referral program,” also referred to as the “Sons and Daughters Program,” to hire candidates referred by clients and government officials. The Sons and Daughters Program was used as a means to influence those same officials to award investment deals to JPMorgan APAC. By late 2009, JPMorgan APAC executives and senior bankers revamped the client referral program to improve its efficacy by prioritizing those hires linked to upcoming client transactions. In order to be hired, a referred candidate had to have a “directly attributable linkage to business opportunity.”
According to admissions made in connection with the resolution, these quid pro quo arrangements were discussed internally among JPMorgan APAC bankers. For example, in late 2009, a Chinese government official communicated to a senior JPMorgan APAC banker that hiring a referred candidate would significantly influence the role JPMorgan APAC would receive in an upcoming initial public offering (IPO) for a Chinese state-owned company. The banker communicated this message to several senior colleagues, who then spent several months trying to place the referred candidate in an investment banking position in New York. Despite learning from personnel in New York that this referred candidate was not qualified for an investment banking position, senior JPMorgan APAC bankers created a new position for the candidate in New York, and JPMorgan APAC thereafter obtained a leading role in the IPO. Further, JPMorgan APAC employees misused compliance questionnaires to justify and paper over corrupt business arrangements. Employees also used a template with pre-filled answers, including that there was “no expected benefit” from the hire, and compliance personnel drafted and modified questionnaires that failed to state the true purpose of the hire.
JPMorgan APAC further admitted that candidates hired during the scheme were typically given the same titles and paid the same amount as entry-level investment bankers, despite the fact that many of these hires performed ancillary work such as proofreading and provided little real value to any deliverable product.
The corrupt scheme netted JPMorgan APAC at least $35 million in profits from business mandates with Chinese state-owned companies.
JPMorgan APAC entered into a non-prosecution agreement and agreed to pay a criminal penalty of $72 million to resolve the matter. As part of the agreement, JPMorgan APAC has agreed to continue to cooperate with the department in any ongoing investigations and prosecutions relating to the conduct, including of individuals, to enhance its compliance program, and to report to the department on the implementation of its enhanced compliance program.
The department reached this resolution based on a number of factors, including that JPMorgan APAC did not voluntarily and timely disclose the conduct at issue. However, JPMorgan APAC did receive full credit for its and JPMC’s cooperation with the criminal investigation, including conducting a thorough internal investigation, making foreign-based employees available for interviews in the United States and producing documents to the government from foreign countries in ways that did not implicate foreign data privacy laws. JPMorgan APAC also took significant employment action against six employees who participated in the misconduct resulting in their departure from the bank, and it disciplined an additional 23 employees who, although not involved in the misconduct, failed to effectively detect the misconduct or supervise those engaged in it. JPMorgan APAC imposed more than $18.3 million in financial sanctions on former or current employees in connection with the remediation efforts. Based on these actions and other considerations, the company received a non-prosecution agreement and an aggregate discount of 25 percent off of the bottom of the U.S. Sentencing Guidelines fine range.
In related proceedings, the U.S. Securities and Exchange Commission (SEC) filed a cease and desist order against JPMC, whereby JPMC agreed to pay $130.5 million in disgorgement to the SEC, including prejudgment interest. The Federal Reserve System’s Board of Governors also issued a consent cease-and-desist order and assessed a $61.9 million civil penalty. Thus, the combined U.S. criminal and regulatory penalties paid by JPMC and its Hong Kong subsidiary are approximately $264.4 million.
The FBI’s New York Field Office investigated the case. The department appreciates the significant cooperation and assistance provided by the SEC and the Federal Reserve Bank of New York in this matter. Assistant Deputy Chief Leo Tsao and Trial Attorneys James P. McDonald and Derek J. Ettinger of the Criminal Division’s Fraud Section and Assistant U.S. Attorney James P. Loonam of the Eastern District of New York’s Business and Securities Fraud Section prosecuted the case.
The Criminal Division’s Fraud Section is responsible for investigating and prosecuting all FCPA matters. Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.
JPMorgan’s Investment Bank in Hong Kong Agrees to Pay $72 Million Penalty for Corrupt Hiring Scheme in ChinaRead the Press Release
BROOKLYN, N.Y. – JPMorgan Securities (Asia Pacific) Limited (JPMorgan APAC), a Hong-Kong based subsidiary of multinational bank JPMorgan Chase & Co. (JPMC), agreed to pay a $72 million penalty for its role in a scheme to corruptly gain advantages in winning banking deals by awarding prestigious jobs to relatives and friends of Chinese government officials.
United States Attorney Robert L. Capers of the Eastern District of New York, Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, and Assistant Director in Charge William F. Sweeney, Jr. of the FBI’s New York Field Office made the announcement.
“U.S. businesses cannot lawfully seek to gain a business advantage by corruptly influencing foreign government officials. The common refrain that this is simply how business is done overseas is no defense,” said United States Attorney Capers. “In this case, JPMorgan employees designed a program to hire otherwise unqualified candidates for prestigious investment banking jobs solely because these candidates were referred to the bank by officials in positions to award business to the bank. In certain instances, referred candidates were hired with the understanding that the hiring was linked to the award of specific business. This is no longer business as usual; it is corruption.”
“The so-called Sons and Daughters Program was nothing more than bribery by another name,” said Assistant Attorney General Caldwell. “Awarding prestigious employment opportunities to unqualified individuals in order to influence government officials is corruption, plain and simple. This case demonstrates the Criminal Division’s commitment to uncovering corruption no matter the form of the scheme.”
“Creating a barter system in which jobs are awarded to applicants in exchange for lucrative business deals is a corrupt scheme in and of itself,” said Assistant Director in Charge Sweeney. “But when foreign officials are among those involved in the bribe, the international free market system and our national security are among the major threats we face. Those engaging in these illegal acts abroad may think they’re out of sight and out of mind, but they’re wrong. The FBI has recently established three dedicated international corruption squads to combat this type of quid pro quo, and we’ll use all resources at our disposal to uncover and put an end to these crimes.”
According to JPMorgan APAC’s admissions, beginning in 2006, senior Hong Kong-based investment bankers set up and used a “client referral program,” also referred to as the “Sons and Daughters Program,” to hire candidates referred by clients and government officials. The Sons and Daughters Program was used as a means to influence those same officials to award investment deals to JPMorgan APAC. By late 2009, JPMorgan APAC executives and senior bankers revamped the client referral program to improve its efficacy by prioritizing those hires linked to upcoming client transactions. In order to be hired, a referred candidate had to have a “directly attributable linkage to business opportunity.”
According to admissions made in connection with the resolution, these quid pro quo arrangements were discussed internally among JPMorgan APAC bankers. For example, in late 2009, a Chinese government official communicated to a senior JPMorgan APAC banker that hiring a referred candidate would significantly influence the role JPMorgan APAC would receive in an upcoming initial public offering (IPO) for a Chinese state-owned company. The banker communicated this message to several senior colleagues, who then spent several months trying to place the referred candidate in an investment banking position in New York. Despite learning from personnel in New York that this referred candidate was not qualified for an investment banking position, senior JPMorgan APAC bankers created a new position for the candidate in New York, and JPMorgan APAC thereafter obtained a leading role in the IPO. Further, JPMorgan APAC employees misused compliance questionnaires to justify and paper over corrupt business arrangements. Employees also used a template with pre-filled answers, including that there was “no expected benefit” from the hire, and compliance personnel drafted and modified questionnaires that failed to state the true purpose of the hire.
JPMorgan APAC further admitted that candidates hired during the scheme were typically given the same titles and paid the same amount as entry-level investment bankers, despite the fact that many of these hires performed ancillary work such as proofreading and provided little real value to any deliverable product.
The corrupt scheme netted JPMorgan APAC at least $35 million in profits from business mandates with Chinese state-owned companies.
JPMorgan APAC entered into a non-prosecution agreement and agreed to pay a criminal penalty of $72,000,000 to resolve the matter. As part of the agreement, JPMorgan APAC has agreed to continue to cooperate with the department in any ongoing investigations and prosecutions relating to the conduct, including of individuals, to enhance its compliance program, and to report to the department on the implementation of its enhanced compliance program.
The department reached this resolution based on a number of factors, including that JPMorgan APAC did not voluntarily and timely disclose the conduct at issue. However, JPMorgan APAC did receive full credit for its and JPMC’s cooperation with the criminal investigation, including conducting a thorough internal investigation, making foreign-based employees available for interviews in the United States and producing documents to the government from foreign countries in ways that did not implicate foreign data privacy laws.
JPMorgan APAC also took significant employment action against six employees who participated in the misconduct resulting in their departure from the bank, and it disciplined an additional 23 employees who, although not involved in the misconduct, failed to effectively detect the misconduct or supervise those engaged in it. JPMorgan APAC imposed more than $18.3 million in financial sanctions on former or current employees in connection with the remediation efforts. Based on these actions and other considerations, the company received a non-prosecution agreement and an aggregate discount of 25 percent off of the bottom of the U.S. Sentencing Guidelines fine range.
In related proceedings, the U.S. Securities and Exchange Commission (SEC) filed a cease and desist order against JPMC, whereby JPMC agreed to pay $130.5 million in disgorgement to the SEC, including prejudgment interest. The Federal Reserve System’s Board of Governors also issued a consent-cease-and-desist order and assessed a $61.9 million civil penalty. Thus, the combined U.S. criminal and regulatory penalties paid by JPMC and its Hong-Kong subsidiary are approximately $264.4 million.
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The case is being prosecuted by Assistant U.S. Attorney James P. Loonam of the Eastern District of New York’s Business and Securities Fraud Section and Assistant Deputy Chief Leo Tsao and Trial Attorneys James P. McDonald and Derek J. Ettinger of the Criminal Division’s Fraud Section. The FBI’s New York Field Office investigated the case.
Inmate Charged with Possession of Contraband in PrisonRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced that a Criminal Information was filed on November 16, 2016, charging Marcus Young, age 32, a federal inmate at the United States Penitentiary at Schuylkill with possession of contraband in prison.
According to United States Attorney Bruce D. Brandler, the information charges Young with possession of a cell phone in prison on October 14, 2016.
The investigation was conducted by the Federal Bureau of Investigation and the Bureau of Prisons Special Investigative Service. Prosecution has been assigned to Assistant United States Attorney Robert J. O’Hara.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law for this offense is one year of imprisonment, a term of supervised release following imprisonment, and a $250,000 fine.
Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Houston Man Sentenced for USPS Letter Carrier RobberyRead the Press Release
HOUSTON – An 18-year-old Houston man has been ordered to federal prison following his conviction of brandishing a firearm during a crime of violence, announced U.S. Attorney Kenneth Magidson.
Sebastien Moore pleaded guilty July 8, 2016.
On Nov. 17, 2016, U.S. District Judge Sim Lake ordered Moore to serve 84 months in federal prison to be immediately followed by three years of supervised release.
Moore robbed a U.S. Postal Service (USPS) letter carrier at gunpoint on Feb. 6, 2016. The USPS worker was placing mail in the mailboxes of a Houston apartment complex when Moore approached. He soon pointed a firearm at the victim and demanded his wallet. The carrier complied.
Moore made several attempts to use the letter carrier’s personal credit card in which one transaction was approved. Moore was seen on surveillance camera, wearing the same clothing worn during the robbery, attempting to use the carrier’s credit card.
The U.S. Postal Inspection Service conducted the investigation. Assistant U.S. Attorney Jennie Basile prosecuted the case.
Hoover Crip Sentenced to Fifteen Years for Drug TraffickingRead the Press Release
Vysean Leandre Embry, 33, of Tulsa, Oklahoma was sentenced for his participation in drug trafficking activities conducted from the Tonight Inn and Suites located at 8333 East Admiral, Tulsa, Oklahoma and other locations throughout Tulsa.
Danny C. Williams, Sr., United States Attorney for the Northern District said, “Embry’s criminal conduct was especially egregious because Embry, a member of the Hoover Crips street gang, and others monopolized the motel and used it as a drug haven for drug trafficking purposes.”
Embry’s prosecution resulted from an eight-month long joint investigation conducted by the Federal Bureau of Investigation and Tulsa Police Department. The investigation culminated in a search warrant executed at the Tonight Inn and Suites on July 29, 2015. The investigation resulted in the prosecution of twelve other individuals who were alleged to have been involved in the illegal distribution of crack cocaine from the Tonight Inn and Suites.
“The joint investigation was part of an effort to target violent gang members through a sustained, proactive, and coordinated investigation using federal resources to identify and prosecute higher ranking gang members and to obtain lengthy prison sentences”, said Williams.
Embry entered a guilty plea pursuant to a plea agreement with the United States. Embry entered a guilty plea to drug conspiracy. Judge Gregory Frizzell, Chief Judge for the Northern District of Oklahoma, sentenced Embry to 180 months in the custody of the Bureau of Prisons, followed by 10 years of supervised release, and $100 special assessment.
The case was prosecuted by Assistant United States Attorney Joel-lyn A. McCormick.
Herkimer County Man Sentenced to 5 Years for Distributing Child PornographyRead the Press Release
UTICA, NEW YORK – Eric Jaquays, age 54, of Little Falls, New York, was sentenced today to 5 years of imprisonment for distributing child pornography.
The announcement was made by U.S. Attorney Richard S. Hartunian and James C. Spero, Special Agent in Charge of the Buffalo Field Office of Homeland Security Investigations (HSI).
As part of his July 20, 2016 plea, Jaquays admitted that between December 27, 2104 and December 12, 2015, he used the Internet and a peer-to-peer file sharing program to distribute 27 video files containing child pornography.
United States District Judge David N. Hurd also imposed a 5-year term of supervised release, which will start after Jaquays is released from prison. As a result of his conviction, Jaquays will be required to register as a sex offender after leaving prison.
This case was investigated by HSI and the Saratoga Springs Police Department, and was prosecuted by Assistant U.S. Attorney Rick Belliss.
Hartford Man Sentenced to 33 Months in Prison for Violating Conditions of Supervised ReleaseRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that FREDDIE GONZALEZ, 34, of Hartford, was sentenced today by Senior U.S. District Judge Alfred V. Covello in Hartford to 33 months of imprisonment for violating the conditions of his supervised release that followed a 2007 conviction for drug and firearm offenses.
According to court documents and statements made in court, on February 9, 2007, GONZALEZ was sentenced in New Haven federal court to 235 months of imprisonment, followed by four years of supervised release, for possession with the intent to distribute five grams or more of cocaine base (“crack cocaine”), and unlawful possession of a firearm as a previously convicted felon.
GONZALEZ had been charged after an investigation into narcotics trafficking and associated violence being committed by the “South Marshall Street Crew” in Hartford. GONZALEZ, who had prior felony convictions for both possession and sale of narcotics, and unlawful possession of a firearm, was arrested on October 12, 2005, when he was found in possession of approximately 9.5 grams of crack cocaine and a loaded semi-automatic 9-millimeter pistol.
Due to changes in the federal crack cocaine sentencing guidelines, GONZALEZ twice had his sentence reduced. In August 2008, GONZALEZ’s sentence was reduced to 188 months of imprisonment and, in November 2011, his sentence was reduced to 130 months of imprisonment.
GONZALEZ was released from federal prison in September 2015 and began serving his four-year term of supervised release.
In May 2016 and again in July 2016, GONZALEZ was arrested on state drug charges. He subsequently received a two-year sentence in state court on a conviction for sale of narcotics.
Judge Covello ordered GONZALEZ to serve the 33-month federal sentence after he completes his two-year state sentence. GONZALEZ will serve an additional two years of supervised release when he is released from federal prison.
This matter was investigated by the Hartford Police Department, Connecticut State Police and U.S. Probation Office. The case was prosecuted by Assistant U.S. Attorney Robert M. Spector.
Harrisburg Man Who Posed as Student Sentenced on Federal Passport and Social Security Fraud ChargesRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Artur Samarin, age 24, also known as Asher Potts, was sentenced today by United States District Court Judge Sylvia H. Rambo in Harrisburg, to two months in federal prison on a two count indictment, which charged Samarin with passport and social security frauds.
Judge Rambo ordered Sarmarin’s sentence to run consecutive to any local sentence he may receive. Samarin currently is waiting to be sentenced in Dauphin County for theft by deception; conspiracy involving theft by deception; tampering with public records; conspiracy involving tampering with public records; statutory sexual assault; and unsworn falsification to authorities.
According to United States Attorney Bruce D. Brandler, Samarin, a Ukrainian man, posed as a high school student in Harrisburg, and used a fictitious identity, Asher Potts, to apply for a United States passport and a social security card.
This case was investigated by the Department of State Diplomatic Security Service, the City of Harrisburg Bureau of Police and the Social Security Administration Office of Inspector General. The case was prosecuted by Assistant United States Attorney Daryl F. Bloom.
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Hardy County man sentenced for cocaine distributionRead the Press Release
ELKINS, WEST VIRGINIA – Jose Vidal-Carcamo, 45, of Moorefield, West Virginia was sentenced to 13 months in prison for cocaine distribution, United States Attorney William J. Ihlenfeld, II, announced.
Vidal-Carcamo distributed cocaine in April 2014 in Hardy County, WV. He pled guilty in October 2015 to one count of “Aiding and Abetting Cocaine Distribution.”
Assistant U.S. Attorney Stephen D. Warner prosecuted the case on behalf of the government. The Potomac Highlands Drug and Violent Crime Task Force investigated.
U.S. District Judge John Preston Bailey presided.
Greensburg Man Admits Impersonating a Secret Service AgentRead the Press Release
PITTSBURGH – A Westmoreland County resident pleaded guilty in federal court jury in Pittsburgh on a charge of fraudulent official seals, United States Attorney David J. Hickton announced today.
Christopher Diiorio, 53, of Greensburg, PA, pleaded guilty to one count before United States District Judge Nora Barry Fischer.
In connection with the guilty plea, Christopher Diiorio conspired with others to produce false United States Secret Service identification cards. He also misrepresented that he was an agent of the United States Secret Service, possessed, and displayed an imitation United States Secret Service badge to a hotel manager in order to obtain the government rate for a hotel stay. Finally, he misrepresented that he was an agent of the United States Secret Service and displayed the false United States Secret Service identification card during an encounter with a local police officer.
Judge Fischer scheduled the sentencing for March 9, 2017. The law provides for a maximum total sentence of five years in prison, a fine of $250,000 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Paul E. Hull is prosecuting this case on behalf of the government.
The United States Secret Service conducted the investigation that led to the prosecution of Christopher Diiorio.
Fourth Conspirator in SnappzMarket Android Mobile Device App Piracy Group Convicted of Conspiracy to Commit Criminal Copyright InfringementRead the Press Release
A fourth member of the SnappzMarket online piracy group was convicted yesterday for his role in the illegal distribution of copies of copyrighted Android mobile device applications.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney John A. Horn of the Northern District of Georgia and Special Agent in Charge David J. LeValley of the FBI’s Atlanta Field Office made the announcement.
Joshua Taylor, 26, of Kentwood, Michigan, was convicted yesterday of one count of conspiracy to commit criminal copyright infringement following a bench trial before U.S. District Judge Timothy C. Batten Sr. of the Northern District of Georgia. Sentencing has been scheduled for Feb. 17, 2017.
Evidence presented at trial demonstrated that Taylor and his co-conspirators identified themselves as members of the SnappzMarket Group, which reproduced and distributed copies of copyrighted Android mobile device apps between May 2011 and August 2012. The co-conspirators distributed the pirated apps without permission from the copyright owners, who sold the apps on legitimate online markets for a fee. The SnappzMarket Group distributed pirated copies of the apps through the group’s own app and through the SnappzMarket alternative online market website. On Aug. 21, 2012, the FBI executed a seizure order against the group’s website, the first time a website domain involving mobile device app marketplaces had been seized.
The total retail value of the more than one million pirated apps distributed by the SnappzMarket Group was estimated to have been more than $1.7 million, according to evidence presented at previous court proceedings.
Co-conspirators Kody Jon Peterson, 24, of Clermont, Florida, and Gary Edwin Sharp II, 29, of Uxbridge, Massachusetts, previously pleaded guilty and await sentencing. Scott Walton, 29, of Cleveland, Ohio, also pleaded guilty in connection with the conspiracy and was sentenced to 46 months in prison on Aug. 15, 2016.
The FBI investigated the case. Assistant Deputy Chief John H. Zacharia of the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS) and Assistant U.S. Attorney Christopher Bly of the Northern District of Georgia prosecuted the case with significant assistance from the Criminal Division’s Office of International Affairs and the CCIPS Cybercrime Lab.
Former Valeant Executive and Former Philidor Ceo Charged in Manhattan Federal Court for Illegal Fraud and Kickback SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today the arrests of GARY TANNER, a former executive at Valeant Pharmaceuticals International, Inc. (“Valeant”), and ANDREW DAVENPORT, the former Chief Executive Officer (“CEO”) of Philidor Rx Services LLC (“Philidor”), for engaging in a multimillion-dollar fraud and kickback scheme. TANNER was arrested in Gilbert, Arizona, and will be presented later today before a Magistrate Judge in Phoenix. DAVENPORT was arrested this morning in Haverford, Pennsylvania, and will be presented later today before a Magistrate Judge in Philadelphia.
U.S. Attorney Preet Bharara said: “Today, we charge corporate fraud at Valeant Pharmaceuticals. Gary Tanner, a former Valeant executive, and Andrew Davenport, the CEO of Philidor, allegedly concocted a fraudulent scheme to illegally use Philidor as a vehicle for personal profit and self-dealing. Their alleged kickback scheme illegally converted Valeant shareholder money into their own personal nest eggs. As alleged, while purporting to be arms-length business counterparts, the two men were, in fact, partners in crime.”
FBI Assistant Director-in-Charge William F. Sweeney said: “As shareholders, we should be able to put our faith in those responsible for making decisions on behalf of our investments. We should be able to rely on them for placing our best interests above their own. But as evidenced by today’s charges, our right to honest services is sometimes exploited by those who engage in kickback schemes that pose significant risks to investors.”
As alleged in the Complaint unsealed today in Manhattan federal court:[1]
Valeant is a publicly traded pharmaceutical manufacturer headquartered in Canada, with its principal place of business in New Jersey. Philidor was a specialty mail-order pharmacy that was formed in or about January 2013 with the assistance of Valeant, including the provision of financing, personnel, and supervision. During the course of Philidor’s existence, at least 90 percent of the drugs dispensed by Philidor were Valeant-branded drugs.
TANNER was the Valeant executive primarily responsible for the Philidor relationship, as well as Valeant’s alternative fulfillment (“AF”) program more generally. Valeant’s AF program attempted to cause doctors to prescribe, and patients to purchase, Valeant Pharmaceuticals instead of generic substitutes or alternatives by helping obtain insurance coverage for those drugs or providing other incentives for prescription and purchase of Valeant drugs. As part of his work at Valeant, TANNER interacted directly with Philidor’s executives, including DAVENPORT, and senior Valeant executives.
Despite being well compensated by Valeant to represent its interests, TANNER used Valeant human and financial resources to benefit Philidor and its largest owner, DAVENPORT, in a variety of ways, including by arranging for Philidor to receive $2 million in Valeant financing, as well as the support of numerous Valeant staff, including a Valeant-paid sales force that was dedicated to promoting sales through Philidor. DAVENPORT recognized the importance of TANNER’s support to Philidor’s success, stating in an email to TANNER concerning Philidor: “We both know that this endeavor would face a nearly insurmountable uphill struggle to succeed in the present Valeant environment without your confident support and the efforts of your team.”
Some of TANNER’s actions benefiting Philidor placed Valeant and its shareholders at risk. Among other things, TANNER resisted efforts to diversify Valeant’s AF program to include other commercially available alternatives to Philidor, increasing Valeant’s dependence on Philidor and what is known as “payor risk,” i.e., the risk that actions by insurers and other payors concerning Philidor could adversely affect Valeant’s financial performance. When asked directly by senior Valeant executives whether he had a financial interest in Philidor, TANNER falsely denied having any such interests.
In the fall of 2014, TANNER and DAVENPORT took advantage of Valeant’s dependence on Philidor to help orchestrate Valeant’s agreement to purchase an option to acquire Philidor (the “Option Agreement”) at a cost to Valeant shareholders of almost $300 million, including $100 million in up-front payments, a $33 million time-based milestone payment, and potential future multimillion-dollar sales-based milestone payments.
Even while TANNER was repeatedly certifying that he was in full compliance with Valeant’s Standards of Business Conduct, which prohibited any conflicts of interest without full disclosure and approval by company management, TANNER and DAVENPORT were making preparations for TANNER to receive multimillion-dollar kickbacks out of the sums paid by Valeant for the Philidor option. Among other things, TANNER and DAVENPORT set up shell companies and shell company bank accounts to be used to launder and distribute the kickbacks. While these preparations were underway, TANNER served as an adviser to his employer Valeant in its negotiations with DAVENPORT over the Option Agreement, even while he secretly advised DAVENPORT on his negotiations with Valeant using a secret Philidor email account that TANNER maintained in the name of “Brian Wilson.”
When the Option Agreement was signed in December 2010, Valeant sent $100 million to the bank accounts of the beneficial owners of Philidor, including DAVENPORT; that sum was followed soon thereafter by the $33 million time-based milestone payment. Over $40 million of those sums were sent to entities that DAVENPORT controlled, including to an entity called “End Game LP.” DAVENPORT kicked back close to $10 million of that sum to TANNER. Those sums were laundered through shell company bank accounts, including a company TANNER had created in the name of Befrielse Consolidated, LLC (“Befrielse”). TANNER used the kickback funds to purchase a new home, to pay for personal expenses, retire debts, and make investments, among other things. DAVENPORT used his share of the proceeds to purchase tens of millions of dollars in securities and to purchase luxury goods and items, including the installation of a $50,000 custom wine cellar.
After the Option Agreement was executed, TANNER continued to use his position at Valeant to advance the interests of Philidor and DAVENPORT, including by expanding the number of Valeant products sold through Philidor and resisting Valeant’s efforts to collect cash from Philidor that Valeant was entitled to collect. In communications concerning the scheme, using TANNER’s secret Brian Wilson email account, DAVENPORT discussed with TANNER how TANNER would secretly continue to promote DAVENPORT’s interests, even while he purported to represent Valeant’s interests as the Valeant executive responsible for Philidor. Among other things, DAVENPORT stated that he pictured his and TANNER’s “butch and sundance ride into the sunset (or off the cliff as in the flick),” to which TANNER responded, using the secret Brian Wilson account: “[G]ave me a good chuckle when I just saw it. Will have to keep playing the game :).”
Neither the nature of Valeant’s relationship to Philidor, nor Valeant’s increasing dependence on Philidor to achieve its sales and profitability goals, was disclosed to the public by Valeant until investor websites and news organizations revealed suspect aspects of Philidor’s operations and Valeant’s connection to Philidor in or about October 2015. Following and in connection with these revelations, several insurers and other payors terminated their contracts with Philidor, resulting in realization of the payor risk that senior executives at Valeant had sought to avoid by diversifying away from Philidor, and Valeant’s stock price declined dramatically.
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TANNER, 39, of Gilbert, Arizona, and DAVENPORT, 48, of Haverford, Pennsylvania, are each charged in four counts: one count of conspiracy to commit honest services wire fraud; one count of honest services wire fraud; one count of conspiring to violate the Travel Act; and one count of conspiring to commit money laundering. Counts One, Two, and Four each carry a maximum sentence of 20 years in prison. Count Three carries a maximum sentence of five years in prison.
The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.
Mr. Bharara praised the work of the FBI. He further thanked the Securities and Exchange Commission for its cooperation and assistance in this investigation. He added that the FBI’s investigation was ongoing.
The charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force and the Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Howard Master, Robert Allen, Richard Cooper, and Ian McGinley are in charge of the prosecution.
The allegations contained in the Complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint, and the description of the Complaint set forth herein, constitute only allegations, and every fact described should be treated as an allegation.
Former Rite Aid Vice President and New Jersey Businessman Sentenced to Prison in $12.9 Million Fraud and Kickback SchemeRead the Press Release
HARRISBURG- The United States Attorney’s Office for the Middle District of Pennsylvania announced today that a former Rite Aid Vice President and a New Jersey business man were sentenced on November 16, 2016, by United States District Court Judge John E. Jones, III, in Harrisburg, for their participation in a $12.9 million dollar fraud and kickback scheme.
According to United States Attorney Bruce D. Brandler, Jay Findling, age 55, of Manalapan, New Jersey, was sentenced to 48 months’ incarceration for his role in the scheme. In February 2015, Findling pleaded guilty to an information charging him with conspiracy to commit wire fraud.
In a separate proceeding, Judge Jones sentenced former Rite Aid Vice President Timothy P. Foster, age 66, of Portland Oregon, to 60 months’ incarceration. Foster pleaded guilty in February 2015, to an information charging him with false statements to authorities.
Judge Jones also ordered Findling and Foster to jointly pay $8,034,183 in restitution. Findling was ordered to pay $6,257,997 within 15 days of sentencing and Foster was ordered to pay $1,776,186 by the end of yesterday.
Under the terms of his plea agreement, Findling also forfeited and turned over an additional $11.6 million to the government at the time he entered his guilty plea.
Both Findling and Foster are to voluntarily surrender to the Bureau of Prisons on January 17, 2017.
The charges are based upon Foster’s and Findling’s 9-year conspiracy to defraud Rite Aid via a surplus inventory sales scheme between 2001 and 2010. As the Vice President for Quality Assurance, Foster’s primary responsibilities at Rite Aid involved the liquidation of surplus Rite Aid inventory across the United States. During the time period in question Foster worked for Rite Aid in Oregon. The scheme succeeded by making Rite Aid believe its surplus inventory had been sold to Findling’s company, J. Finn Industries, LLC, for amounts reported by Foster when, in fact, the inventory had been sold to third parties for greater amounts. Findling would then kick back a portion of his profits to Foster.
The scheme started in 2001 and continued until February of 2010 when Foster ended his employment with Rite Aid. Findling admitted he established a bank account in New Jersey under the name of “Rite Aid Salvage Liquidation.” The account was used by the conspirators to collect the payments submitted by the real buyers of the surplus Rite Aid inventory. After the payments were received, Findling would send lesser amounts dictated by Foster to Rite Aid for the goods, thus inducing Rite Aid to believe the inventory had been purchased by J. Finn Industries, not the real buyers.
During a loss hearing in June 2015, the government introduced proof that Findling received at least $127.7 million from the real buyers of the surplus Rite Aid inventory but, with Foster’s help, only tendered $98.6 million of that amount to Rite Aid, leaving Findling with a profit of approximately $29.1 million from the scheme. The government also introduced proof that Findling kicked back $5.9 million of the $29.1 million to Foster, primarily in the form of cash. Upon the conclusion of the loss hearing, Judge Jones concluded the net loss to Rite Aid, after giving Findling some credit for his services, was $11.2 million. Judge Jones also found that Rite Aid sustained an additional $1.7 million loss as a result of a similar kick-back scheme with another West Coast businessman who was not charged in the scheme, bringing the total loss to Rite Aid to $12.9 million.
Foster admitted he knowingly and willfully lied when he was interviewed by the Federal Bureau of Investigation (FBI) in January 2014 and denied he conspired with Findling to defraud Rite Aid. Foster subsequently recanted his false statements when he was re-interviewed on May 1, 2014. During that interview Foster not only admitted to conspiring to defraud Rite Aid with Findling, Foster voluntarily surrendered $2,941,940 in cash kickbacks he had received from Findling over the life of the conspiracy. Foster stored the cash in three, 5-gallon paint containers in his Phoenix, Arizona garage. Foster later surrendered to the FBI an additional $454,020 in cash and approximately $541,342 in gold and silver coins.
The case was investigated by the Harrisburg Office of the Federal Bureau of Investigation. The cases were prosecuted by Assistant United States Attorney Kim Douglas Daniel.
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Former Parker and Denver Massage Parlor Owner Sentenced for Obstructing the IRSRead the Press Release
DENVER – Jung Yoon Choi, age 56, formerly of Aurora, Colorado was recently sentenced by U.S. District Court Judge Robert E. Blackburn to serve 19 months in federal prison followed by one year of supervised release for obstructing and impairing the laws of the Internal Revenue Service, announced Acting United States Attorney Bob Troyer and IRS Criminal Investigation Special Agent in Charge Steven Osborne.
Choi waived her right to indictment by a federal grand jury and was charged by information on October 2, 2015 for obstructing and impairing the laws of the Internal Revenue Service and pled guilty to this charge on January 14, 2016. As part of the plea agreement, Choi has agreed to forfeit $118,575.00 seized on December 17, 2010. She was also ordered to pay $67,560 in restitution to the IRS.
According to the information and plea agreement, from January 1, 2009, through December 31, 2010, Choi owned and operated three massage parlors in the Denver Metropolitan area, specifically; Ivy Spa located at 2260 S. Quebec Way, Denver, CO (during 2009); New Image Spa located at 17783 Cottonwood Drive, Parker, CO (during 2010); and Blue Pine Spa located at 6212 East Pine Lane, Douglas County, CO (during 2010).
Choi typically staffed each of her spas with an on-site manager and a number of workers who provided services to customers. The primary service provided by her workers was giving massages. Each of the spas typically had a fee schedule according to which customers paid a door fee ordinarily ranging from $40 to $50, depending on the amount of time requested (30 to 60 minutes were the norm). In addition, customers at the various spas often paid an additional fee which was characterized as a “tip” in many instances for “extra services” provided by Choi’s workers. At times, the “extra services” consisted of prostitution services in violation of Colorado Revised Statute, 18-7-201. Specifically, the workers would engage in sexual acts with customers in exchange for money. Choi was aware that prostitution was occurring at times in each of her spas and that business income was being generated from such activity. Choi regularly advertised for her spas using Westword newspaper and Sowet.com. Choi paid the owner of Sowet.com, David Warmack, a monthly fee to post favorable reviews on his website touting her various businesses and the women who worked there. Warmack was previously prosecuted by the U.S. Attorney’s Office and was sentenced to serve 15 months in federal prison by U.S. District Court Judge Christine M. Arguello for related criminal activity.
Choi generated substantial income from each of her spas for tax years 2009 to 2010. However, she failed to file personal income tax returns for 2009 and 2010, and thus she did not report her business income for either year and she did not pay any taxes to the IRS. In addition to not filing tax returns and not paying taxes, Choi further impeded the IRS’s collection of taxes by several means, including: using nominees on bank accounts so as to conceal her business income; conducting cash and business transactions using nominees; conducting financial transactions in amounts that were less than $10,000 so as not to trigger the filing of currency transaction reports; and hiding and storing income in the form of cash hoards at various locations.
IRS Special Agents conducted a financial analysis of the Ivy Spa bank account for 2009 and the account showed deposits totaling $118,418. The vast majority of such deposits, $106,322, came from credit card payments from customers at Ivy Spa. The $118,418 in funds deposited into this account represented gross income generated by Choi for tax year 2009.
Choi also utilized nominees to conduct financial transactions in bank accounts for New Image Spa and Blue Pine Spa in 2010. Choi received substantial business income from New Image and Blue Pine Spa throughout 2010 in the form of cash and credit card deposits which she concealed. She regularly took a portion of her cash earnings and secreted the funds in cash hoards at various locations. Particularly, on December 17, 2010, pursuant to a federal search warrant, IRS Special Agents seized approximately $118,575, in cash from a locker at the U-Store-It. In total, Special Agents seized $219,388 in cash from Choi or her associates in late 2010. Such funds represented gross, business income which Choi generated during 2010.
“You have to pay taxes, regardless of your profession,” said Acting U.S. Attorney Bob Troyer. “Thanks to the exceptional work by our prosecutors and IRS CI and FBI agents, Ms. Choi will suffer a righteous consequence for evading that duty.”
“The privilege of living in the United States carries certain responsibilities, one of which is the voluntary payment of taxes,” said Kareem Carter, Acting Special Agent in Charge, Denver Field Office, Internal Revenue Service – Criminal Investigation. “The prosecution of individuals, such as Choi, who intentionally conceal income and evade taxes, is a vital element of IRS-CI’s enforcement strategy of holding people accountable for their criminal actions.”
This case was investigated by Internal Revenue Service – Criminal Investigation, the Federal Bureau of Investigation, the Los Angeles Police Department and the Arapahoe County Sheriff’s Office. The case was prosecuted by Assistant United States Attorney Tim R. Neff.
Former Mississippi Corrections Officer Pleads Guilty to Cover-Up of Inmate AssaultRead the Press Release
The Justice Department announced today that former Mississippi correctional officer Deonte Pate, 23, pleaded guilty today to helping conceal the beating of an inmate.
Pate admitted to conspiring to cover up a beating carried out by two other officers, who were also charged for their roles in the incident. Pate acknowledged that he submitted false reports and lied to the FBI in order to prevent knowledge of the beating from reaching outside authorities. He was charged in June with officers Lawardrick Marsher, 28, and Robert Sturdivant, 47. All three were officers at Mississippi State Penitentiary in Parchman, Mississippi.
The indictment charged Marsher and Sturdivant with kicking, punching and throwing the victim to the ground. The indictment also alleges that their actions involved the use of a dangerous weapon and resulted in bodily injury to the victim.
“In the closed prison environment, we rely on corrections officers to protect the safety and well-being of inmates,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division. “When officers abuse inmates – or in this case lie to cover up abuse – their actions offend the law and undermine the integrity of our justice system.”
“The defendant abused his authority, violated the law and the public trust,” said U.S. Attorney Felicia C. Adams of the Northern District of Mississippi. “The U.S. Attorney’s Office for the Northern District of Mississippi is committed to aggressively prosecuting those correctional officers who break the law and violate an individual’s constitutional rights.”
“Public servants should be held to a higher standard, especially those tasked with maintaining order and watching over our prisons,” said Special Agent in Charge Donald Alway of the FBI Jackson Division. “When corrections officers violate the civil rights of those they are sworn to protect, the entire system suffers the consequences. We appreciate the long standing relationships with our local, state and federal partners that aided in this investigation.”
Pate faces a maximum sentence of five years in prison. Sentencing is tentatively scheduled for March 16, 2017. The charges against Marsher and Sturdivant are still pending and trial is scheduled for Feb. 6, 2017.
An indictment is merely an accusation, and the remaining defendants are presumed innocent unless and until proven guilty.
This case is being investigated by the FBI’s Jackson Division, with the cooperation of the Mississippi Department of Corrections. It is being prosecuted by Assistant U.S. Attorney Robert Coleman of the Northern District of Mississippi and Trial Attorney Dana Mulhauser of the Civil Rights Division’s Criminal Section.
Pate Plea AgreementFormer Mississippi Corrections Officer Pleads Guilty to Cover-Up of Inmate AssaultRead the Press Release
WASHINGTON – The Justice Department announced today that former Mississippi correctional officer Deonte Pate, 23, pleaded guilty today to helping conceal the beating of an inmate.
Pate admitted to conspiring to cover up a beating carried out by two other officers, who were also charged for their roles in the incident. Pate acknowledged that he submitted false reports and lied to the FBI in order to prevent knowledge of the beating from reaching outside authorities. He was charged in June with officers Lawardrick Marsher, 28, and Robert Sturdivant, 47. All three were officers at Mississippi State Penitentiary in Parchman, Mississippi.
The indictment charged Marsher and Sturdivant with kicking, punching and throwing the victim to the ground. The indictment also alleges that their actions involved the use of a dangerous weapon and resulted in bodily injury to the victim.
“In the closed prison environment, we rely on corrections officers to protect the safety and well-being of inmates,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division. “When officers abuse inmates – or in this case lie to cover up abuse – their actions offend the law and undermine the integrity of our justice system.”
“The defendant abused his authority, violated the law and the public trust,” said U.S. Attorney Felicia C. Adams of the Northern District of Mississippi. “The U.S. Attorney’s Office for the Northern District of Mississippi is committed to aggressively prosecuting those correctional officers who break the law and violate an individual’s constitutional rights.”
“Public servants should be held to a higher standard, especially those tasked with maintaining order and watching over our prisons,” said Special Agent in Charge Donald Alway of the FBI Jackson Division. “When corrections officers violate the civil rights of those they are sworn to protect, the entire system suffers the consequences. We appreciate the long standing relationships with our local, state and federal partners that aided in this investigation.”
Pate faces a maximum sentence of five years in prison. Sentencing is tentatively scheduled for March 16, 2017. The charges against Marsher and Sturdivant are still pending and trial is scheduled for Feb. 6, 2017.
An indictment is merely an accusation, and the remaining defendants are presumed innocent unless and until proven guilty.
This case is being investigated by the FBI’s Jackson Division, with the cooperation of the Mississippi Department of Corrections. It is being prosecuted by Assistant U.S. Attorney Robert Coleman of the Northern District of Mississippi and Trial Attorney Dana Mulhauser of the Civil Rights Division’s Criminal Section.
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Former Madison County, Alabama, Deputy Sentenced to Three Years in Prison for Lying Under Oath to Obstruct Investigation into BeatingRead the Press Release
The Justice Department announced today that Justin Watson, 32, a former deputy with the Madison County Sheriff’s Office in Huntsville, Alabama, was sentenced today to three years in prison for lying under oath with the intent to obstruct a federal investigation.
According to his plea agreement, Watson, while off-duty, got into a bar fight with a handyman. Watson searched for the man over the next several weeks, and when he observed the man driving down the highway, Watson pulled him over and ordered him out of his truck. Watson proceeded to strike the man in the face, hit him with a baton and choke him until he was unconscious. At a criminal proceeding arising out of those charges, Watson knowingly and falsely claimed, under oath, that he had never seen the man before the traffic stop and that he had not gotten into a bar fight with the man.
“Watson lied under oath to obstruct an investigation into his violent assault of a motorist,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division. “When officers deliberately try to impede federal investigations, their actions violate the law.”
“Although the vast majority of police officers perform their duties with integrity, Justin Watson did not, using his badge to interfere with an investigation into police misconduct,” said U.S. Attorney Joyce White Vance of the Northern District of Alabama. “Communities must be able to expect fair treatment from law enforcement. Watson violated the community’s trust and will now go to prison as a result.”
This case was investigated by the FBI, and was prosecuted by Assistant U.S. Attorney Mary Stuart Burrell of the Northern District of Alabama and Trial Attorney Christopher J. Perras of the Criminal Section of the Civil Rights Division.
Former Harrison School District Assistant Band Director Sentenced to 15 Years in Federal Prison for Criminal Sexual Offenses Against Minor StudentsRead the Press Release
Fort Smith, Arkansas - Kenneth Elser, United States Attorney for the Western District of Arkansas, announced that Kyle Lee Smith, age 29 of Branson, Missouri was sentenced to 180 months in federal prison followed by five (5) years of supervised release on one count of Transportation of a Minor with Intent to Engage in Criminal Sexual Activity and one count of Coercion and Enticement of a Minor. The sentences are to run concurrent with each other. The Honorable Chief Judge P. K. Holmes, III presided over the sentencing hearing in the United States District Court in Fort Smith.
According to court records, in August, 2015, the Harrison Police Department received a report that an assistant band director with the Harrison School District was engaging in a sexual relationship with an underage student. During the subsequent investigation, the student disclosed that Smith had invited her to his Missouri residence to engage in sexual activity with her. She was able to provide law enforcement with evidence that substantiated that Smith had engaged in sexual activity with her.
The resulting investigation revealed that Smith had also been engaging in sexually activity with a second female student. She was able to provide law enforcement with screen shots of her conversations with Smith, many of which were overtly sexual in nature. Homeland Security Investigations obtained Snapchat records between Smith and the victims and found that hundreds of messages and images were sent between the victims and Smith.
“Preying on underage girls from a position of trust is a vile and heinous act”, said Special Agent in Charge of HSI New Orleans Raymond R. Parmer, Jr. “We expect people with access to our children to have their best interests at heart. We will continue to work diligently with our law enforcement partners to protect our children from predators like this.”
The investigation was led by Homeland Security Investigations and the Harrison Police Department. Assistant United States Attorney Dustin Roberts prosecuted the case for the United States.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and their Criminal Division Child Exploitation and Obscenity Sections (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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Related court documents may be found on Public Access to Electronic Records Website @www.Pacer.gov
Former Augusta Man Indicted for Threatening Federal OfficialsRead the Press Release
Contact: Chris Ruge
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Peter Hamilton, a/k/a “Peter W. Merriman,” and “Peter M. Hooper,” 65, recently of Augusta, Maine, was charged by indictment in U.S. District Court for threatening federal officials.
According to court records, between May 2014 and May 2016, the defendant wrote messages and made statements threatening to kill President Barack Obama and U.S. Representative Chellie Pingree.
The defendant made an initial appearance by video teleconference today in U.S. District Court. He faces up to 10 years in prison and a $250,000 fine.
This case was investigated by the U.S. Secret Service and U.S. Capitol Police.
An indictment is merely an accusation and a defendant is presumed innocent unless proven guilty in a court of law.
Florida Men to Serve Three Years in Federal Prison for Fraudulent Credit Card ConspiracyRead the Press Release
ROCK ISLAND, Ill. – Two Florida men have been ordered to serve three years in federal prison for stealing and using credit card information. Osiel Valdes-Perez, 22, and Felix Alain Delgado-Martinez, 39, both of Miami Gardens, were each sentenced yesterday, Nov. 16, for participating in a fraudulent credit card conspiracy and possession of fraudulent credit cards. In addition to the prison term, U.S. District Judge Sara Darrow ordered each of the men to pay $5,243 in restitution to victims of the offense.
Valdes-Perez pled guilty to the conspiracy and possession offenses on Feb. 18, 2016, and Delgado-Martinez entered his guilty plea on Mar.3, 2016. Another co-defendant, Pedro Enrique Quevedo-Perez, pled guilty on Oct, 12, 2016, and is scheduled to be sentenced on Feb. 16, 2017.
The defendants admitted that in May and June 2015, they used skimming devices, placed in gas pumps in the Rock Island area, to collect account data from swiped cards. The stolen account information was then used to purchase gift cards and small electronics.
Assistant U.S. Attorney Meredith DeCarlo prosecuted the case. The charges were investigated by the U.S. Secret Service and the Moline Police Department.
Elyria man sentenced to nine years in prison for cocaine traffickingRead the Press Release
An Elyria man was sentenced to more than nine years in prison for trafficking cocaine, U.S. Attorney Carole S. Rendon said.
Ronnie Wright, Jr. was sentenced to 110 months in prison. He was found guilty earlier this year of possession with intent to distribute cocaine.
Wright was arrested last year after he fled from a traffic stop along Interstate 71. Wright reached speeds of more than 90 mph before crashing. Wright ran from the crash site but was eventually arrested. Officers found a total of seven vacuum-sealed bricks of cocaine in the area, according to court documents.
This case was prosecuted by Assistant U.S. Attorneys Vasile Katsaros and Phillip J. Tripi following an investigation by the DEA and Ohio State Highway Patrol.
Duson man pleads guilty to not paying nearly a quarter of a million dollars in taxesRead the Press Release
LAFAYETTE, La. – United States Attorney Stephanie A. Finley announced that a Duson business owner pleaded guilty Wednesday to evading taxes for three years.
Larry J. Thibodeaux, 65, of Duson, La., pleaded guilty before U.S. Magistrate Judge Carol B. Whitehurst to one count of attempting to evade and defeat payment of tax. The plea will become final when accepted by U.S. District Judge Donald E. Walter. According to the guilty plea, Thibodeaux, who at the time of the offense was the president and sole shareholder of Thib’s Trailers in Duson, underreported taxes on IRS forms from 2012 to 2014. The corporate tax loss for the three years was $110,970, and the individual tax loss was $137,807 for a total loss to the U.S. Treasury of $248,777.
“The prosecution of individuals who intentionally conceal income and evade taxes is a vital element in maintaining public confidence in our tax system,” Finley stated. “Honest taxpayers should not be expected to foot the bill for those that hide income from the IRS. The U.S. Attorney’s Office will aggressively prosecute individuals who intentionally conceal income and evade taxes.”
"The filing and timely payment of tax returns is an obligation that all Americans share,” said Special Agent in Charge of IRS Criminal Investigation, Jerome R. McDuffie. “Our agency will continue to work with the U.S. Attorney’s Office to aggressively investigate allegations of tax crimes and prosecute those who fail to pay their fair share. The guilty plea entered by Mr. Thibodeaux today is a reminder that citizens have the responsibility to file accurate returns and report all of their income.”
Thibodeaux faces up to five years in prison, three years of supervised release, restitution and a $250,000 fine. A sentencing date of February 13, 2017 was set.
IRS Criminal Investigations conducted the investigation. Assistant U.S. Attorney Daniel J. McCoy is prosecuting the case.
Desert Hot Springs Man Found Guilty by Federal Jury of Multiple Firearms Violations and Distribution of MethamphetamineRead the Press Release
LOS ANGELES – The first of six defendants charged as the result of an anti-gang operation in the Coachella Valley earlier this year has been found guilty of possession of an unregistered short barreled shotgun, being a felon in possession of a firearm and ammunition, and two counts of distribution of methamphetamine.
Mario Vincent Lopez, 49, of Desert Hot Springs, who had previously been convicted of multiple state felony offenses, was found guilty yesterday by a federal jury that deliberated for less than an hour.
Lopez will face a mandatory minimum penalty of 10 years in federal prison – and a possible term of life imprisonment – when he is sentenced by United States District Judge André Birotte Jr. on February 13, 2017.
“Illegal firearms and drug trafficking is a volatile combination that poses a significant danger to the community,” said United States Attorney Eileen M. Decker. “This defendant was undeterred by his prior felony convictions, but now he faces a much longer prison sentence as a result of this jury’s verdicts.”
Lopez was one of six men charged as the result of an investigation by the Coachella Valley Gang Impact Team, a joint task force involving both federal and local authorities. All six men have been in custody since they were arrested in June.
In addition to Lopez, Julio Cesar Gomez, also known as “Spanky,” 31, of Indio; Angel Alejandro Carmona, aka “Lil Criminal,” 30, of Coachella; and Steven Andrew Gonzalez, aka “Cubs,” 32, of Indio, were charged with engaging in a conspiracy to distribute methamphetamine. Gomez was also charged with being a felon in possession of an assault rifle with an obliterated serial number, and Carmona was charged with being a felon in possession of a .357-caliber handgun. These three defendants are scheduled to go on trial on April 18, 2017.
In another case, Francisco Remigio Figueroa, aka “Toro,” 34, of Desert Hot Springs, was charged in an indictment with distributing methamphetamine and marijuana. Figueroa was also charged with possessing a 20-gauge shotgun and ammunition after being convicted of multiple state felonies. Figueroa’s trial is set for February 21, 2017.
Finally, Donnie Darnel Dennis, 38, of Desert Hot Springs, was charged with distributing methamphetamine. His case is set for trial on January 24, 2017.
An indictment or criminal complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty in court.
The Gang Impact Team is a multiagency task force responsible for conducting gang, firearm and violent crime investigations throughout Riverside County. The team is made up of officers and agents from local, state, county and federal agencies, and it is part of the Riverside County District’s Attorney’s Office Organized Crime Bureau. The Team includes representatives from the Riverside County District Attorney’s Office; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Federal Bureau of Investigation; U.S. Immigration and Customs Enforcement’s Homeland Security Investigations; the United States Border Patrol; the Riverside County Housing Authority; and the Desert Hot Springs Police Department.
The case was prosecuted by Assistant United States Attorneys Abigail Evans and Sean Peterson of the Riverside branch office.
Concord Man Sentenced to 72 Months in Prison for Mail FraudRead the Press Release
CONCORD, N.H. – Ronald Mason, 47, has been sentenced to 72 months in prison for mail fraud offenses that involved the theft of more than $650,000, announced United States Attorney Emily Gray Rice. Mason previously pleaded guilty on June 1, 2016.
In October 2004, Mason was sentenced to 33 months in prison and three years of supervised release for a federal offense he committed in Texas. While Mason was serving that sentence, the owner of Financial Resources Management, Scott Farrar, and Farrar’s business associate, Donald Dodge, pleaded guilty in U.S. District Court in New Hampshire to stealing more than $30 million from FRM’s investors.
After Mason was released from prison, he absconded from his federal supervision and a warrant was issued for his arrest. To avoid being arrested, Mason used a false last name and moved to Concord, New Hampshire. He then caused letters to be sent to more than 100 people who Farrar and Dodge defrauded by falsely promising to use their money to build the Abbott Village condominiums in Concord. Three people responded to the letter. When Mason met with them, he lied to them about his personal wealth and his experience as a real estate developer. Over the next several months, he stole more than $520,000 from the former FRM victims by falsely promising to use their money to complete Abbott Village and for other real estate projects in New Hampshire.
When Mason’s efforts to steal money from these former FRM victims stalled, he concealed his status as a fugitive and provided false information about his personal wealth to steal more than $130,000 from two other people.
The case was investigated by the New Hampshire Attorney General’s Office, the United States Secret Service, and the United States Postal Inspection Service. The case was prosecuted by Assistant U.S. Attorney Robert Kinsella.
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Cleveland man sentenced to more than six years in prison for selling heroin, fentanyl and cocaineRead the Press Release
A Cleveland man was sentenced to more than six years in prison for trafficking fentanyl, heroin and cocaine, law enforcement officials said.
Roland M. Smith, 43, was found guilty earlier this year of conspiring to distribute at least 40 grams of fentanyl, 100 grams of heroin and 500 grams of cocaine.
This case is being prosecuted by Assistant U.S. Attorney Joseph M. Pinjuh following an investigation by the Northern Ohio Law Enforcement Task Force.
City of Passaic Mayor Admits Taking $110,000 in Corrupt Payments from DevelopersRead the Press Release
NEWARK, N.J. – The mayor of the City of Passaic, New Jersey, today admitted taking $110,000 in corrupt payments from developers doing business in the city, U.S. Attorney Paul J. Fishman announced.
Alex D. Blanco, 44, of Passaic, pleaded guilty before U.S. District Judge William J. Martini in Newark federal court to an information charging him with one count of soliciting and accepting corrupt payments in connection with City of Passaic business.
“The conduct admitted by Mayor Blanco demonstrates an aggressive and appalling greed,” U.S. Attorney Fishman said. “By soliciting these payments from developers, he took for himself federal money that was intended to help provide housing for the city’s poorest residents. We expect our public officials to behave differently.”
“Public corruption is one of the FBI's top priorities,” Special Agent in Charge Timothy Gallagher of the FBI Newark Division said. “Today's guilty plea by Passaic Mayor Alex Blanco is indicative of how diligently the FBI and our law enforcement partners work corruption matters. We will continue to investigate allegations of public corruption thoroughly to ensure any person who misuses their public office for private gain is held accountable.”
“The mayor’s guilty plea is a testament to the hard work and dedication of our special agents and their law enforcement colleagues—job well done,” Special Agent in Charge Terence S. Opiola, Homeland Security Investigations, Newark Field office, said.
According to documents filed in this case and statements made in court:
From 2010 through 2012, two developers were seeking to build eight low-income residential units on property they owned in Passaic. After the Passaic City Council and the Passaic Zoning Board of Adjustment granted approval, Blanco – who has been mayor since November 2008 – had an intermediary approach the developers in July 2011. The developers were told they were expected to provide a sizable payment to the mayor to ensure that the project would proceed.
A short time later, the Passaic City Council approved the release of $216,400 in Housing and Urban Development (HUD) funds to the developers, money that had been earmarked for the project. In early September 2011, Blanco arranged for a meeting with the developers at which he solicited and agreed to accept $75,000. The next day, he arranged for a meeting with one of the developers in Clifton, New Jersey, and asked for the corrupt payment in cash, but was told by the developer that the developer had brought signed, blank checks, which could be made out to payees of Blanco’s choosing. Blanco obtained those checks – totaling $65,000 – once the payee lines had been filled in, arranged for them to be cashed, and pocketed the cash proceeds.
About eight days later, Blanco arranged for another meeting in Passaic with one of the developers and solicited and accepted two additional checks totaling $40,000, proceeds of which were ultimately provided to Blanco in cash. In March 2012, Blanco accepted cash proceeds from an additional $5,000 check solicited on his behalf. Much of the $110,000 in corrupt payments was derived from the HUD monies that had been released to the developers in 2011.
The charge to which Blanco pleaded guilty carries a maximum potential penalty of 10 years in prison and a fine of $250,000 or twice the gross gain or loss caused by the offense. Sentencing is scheduled for Feb. 23, 2017.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Gallagher; and special agents of the U.S. Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Opiola, with the investigation leading to today’s guilty plea. He also thanked special agents of the Office of Inspector General, U.S. Department of Housing and Urban Development, under the direction of Special Agent in Charge Christina Scaringi, for their assistance in the investigation.
The government is represented by Assistant U.S. Attorneys Mark J. McCarren and José R. Almonte of the U.S. Attorney’s Office Special Prosecutions Division in Newark and Assistant U.S. Attorney James M. Donnelly of the Criminal Division in Newark.
Defense attorneys: Joseph A. Hayden Jr. Esq., and Aidan P. O’Connor Esq., Hackensack, New Jersey
Chesterfield Township Supervisor Arrested and Charged with Demanding and Taking BribesRead the Press Release
The elected Supervisor of Chesterfield Township was arrested by agents of the Federal Bureau of Investigation (FBI) today based on a criminal complaint charging him with demanding and taking bribes in exchange for his official acts in connection with a municipal contract, U.S. Attorney Barbara McQuade announced.
McQuade was joined in the announcement by FBI Special Agent in Charge David P. Gelios and Manny J. Muriel, Special Agent in Charge, Internal Revenue Service-Criminal Investigation, Detroit Field Office.
Michael Lovelock, 57, of New Baltimore, was charged with engaging in a pattern of corrupt activity, including demanding and accepting money in exchange for official acts as the Chesterfield Supervisor. Lovelock’s arrest is part of an ongoing and long-running investigation into systemic corruption in multiple municipalities in southeast Michigan, primarily Macomb County. The investigation has employed telephone wiretaps, consensual audio and video recordings by cooperative individuals, undercover operations, physical surveillance, telephone tracking warrants, and subpoenas of financial records and other documents.
The complaint charges that since approximately 2010 and continuing through 2016, Lovelock accepted multiple bribes from the representative of a company that had a significant contract with Chesterfield Township. In total, Lovelock accepted over $30,000 in cash from the company’s representative. In addition, Lovelock accepted two other bribe payments totaling $4,000 in cash from an undercover agent of the FBI and an individual cooperating in the investigation, with the payments being video recorded. In exchange for all of the cash that Lovelock demanded and accepted during the course of the bribery conspiracy, Lovelock agreed to use his official position as Chesterfield Supervisor to: (1) secure an extension of the contract with the township for the company, (2) put past due accounts of the company on the Chesterfield tax rolls so as to assist the company in getting paid by township residents, (3) obtain payment from Macomb County for the company for its work on flood damage that occurred in August 2014; and (4) provide a favorable reference for the company for other municipalities and so that Lovelock would not speak negatively about the company.
“Public officials who seek to take advantage of their official positions for their own personal gain by selling official acts should expect to be arrested and prosecuted,” said U.S. Attorney McQuade. “The citizens of our district deserve elected representatives who make decisions based on the best interests of the community rather than their own corrupt financial interests.”
"Today’s arrest further demonstrates the continuing threat we face of elected officials, at any level of the government, prioritizing personal gain over their sworn obligation to represent their constituents’ best interests and uphold the trust afforded to them by the citizens they represent,” said David P. Gelios, Special Agent in Charge, Detroit Division of the Federal Bureau of Investigation. "The FBI led Detroit Area Public Corruption Task Force will continue to prioritize the investigation of cases involving any federal, state, or local public officials who solicit and accept bribes in exchange for official acts.”
This investigation is being conducted by the FBI Detroit Area Corruption Task Force, a multiagency task force led by the FBI Detroit Division and comprised of the Internal Revenue Service – Criminal Investigation Division, Michigan State Police, Michigan Attorney General’s Office, and several other local and federal law enforcement agencies. It is being prosecuted by Assistant United States Attorneys R. Michael Bullotta and David A. Gardey.
Upon conviction for a violation of Title 18, United States Code, Section 666, federal program bribery, Lovelock faces a maximum of ten years in prison and a fine of up to $250,000.
A complaint is only a charge and is not evidence of guilt. Trial cannot be held on felony charges in a complaint. When the investigation is completed a determination will be made whether to seek a felony indictment.
The FBI requests that anyone having information regarding public officials accepting bribes is encouraged to contact the Detroit Division of the FBI at 313-965-2222.
Charleston man sentenced to federal prison for escape and heroin chargesRead the Press Release
CHARLESTON, W.Va. – A Charleston man was sentenced today to three years in federal prison for separate charges of escape and possession with intent to distribute heroin, announced United States Attorney Carol Casto. Brandon Christopher Solomon, 21, originally from Detroit, previously entered his guilty plea to a two-count indictment.
Solomon admitted that in December 2015, he escaped from a halfway house in St. Albans. Solomon was at the halfway house finishing a sentence for violating his federal supervised release from a prior drug conviction. Solomon’s whereabouts were unknown for several months until April 28, 2016, when officers with the Metropolitan Drug Enforcement Network Team located him while executing a search warrant on Daniel Boone Drive in Charleston. Solomon was arrested on the outstanding escape warrant, and when he was searched, officers located six baggies of heroin and cash in his pocket.
The United States Marshals Service and the Metropolitan Drug Enforcement Network Team conducted the investigation. Assistant United States Attorney Haley Bunn is in charge of the prosecution. United States District Judge Joseph R. Goodwin imposed the sentence.
This prosecution was brought as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and heroin. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
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Charleston drug dealer pleads guilty to distributing methamphetamineRead the Press Release
CHARLESTON, W.Va. – A Charleston methamphetamine dealer pleaded guilty today to a federal drug crime, announced United States Attorney Carol Casto. Keary Drake, 48, entered his guilty plea to distribution of methamphetamine.
Drake admitted that on April 28, 2016, he sold methamphetamine to a confidential informant working with the Sheriff’s Tactical Operations Patrol (STOP) team of the Kanawha County Sheriff’s Office. Drake also admitted that he sold methamphetamine to a confidential informant on two more occasions in June and July of 2016. On July 13, 2016, law enforcement executed a search warrant at Drake’s residence on Bakers Fork Road in Charleston and recovered methamphetamine. Drake admitted to law enforcement that he had been dealing methamphetamine for six months and had sold approximately 84 grams.
Drake faces up to 20 years in federal prison when he is sentenced on February 23, 2017.
The Kanawha County Sheriff’s Office and the Drug Enforcement Administration conducted the investigation. Assistant United States Attorney Erik S. Goes is in charge of the prosecution. The plea hearing was held before United States District Judge Thomas E. Johnston.
This case is being prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of illegal drugs, including methamphetamine. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down pill trafficking, eliminating open air drug markets, and curtailing the spread of illegal drugs in communities across the Southern District.
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Carbon County Man Pleads Guilty to Producing Child PornographyRead the Press Release
SCRANTON- The United States Attorney’s Office for the Middle District of Pennsylvania announced that Grant Harris, age 36, of Carbon County, pleaded guilty today before Senior U.S. District Court Judge James M. Munley in Scranton, to producing child pornography.
According to United States Attorney Bruce D. Brandler, Harris, who resided in Albrightsville at the time of the offense, admitted to persuading and enticing a minor to engage in sexually explicit conduct for the purpose of producing a visual image of that conduct.
The crime occurred sometime between 2008 and 2009, when the victim was eight-years-old. Harris was indicted by a federal grand jury in November 2015, shortly after agents and police discovered the child pornography on a computer used by the defendant.
Judge Munley ordered a pre-sentence investigation to be completed and scheduled sentencing in the case for February 17, 2017. Harris remains detained in prison pending sentencing.
The investigation was conducted by Homeland Security Investigations, the Pennsylvania State Police, and the Pennsylvania Attorney General’s Office. Assistant United States Attorney Francis P. Sempa is prosecuting the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
Harris faces a mandatory minimum sentence of 15 years in prison and a potential maximum sentence of 30 years in prison, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Captured Fugitive Sentenced to Prison for Rolling Back Odometers in Scheme That Defrauded Hundreds of Car BuyersRead the Press Release
A woman originally from Lackawanna County, Pennsylvania, was sentenced today in U.S. District Court in Philadelphia to 50 months in prison on charges related to an odometer tampering conspiracy, the Department of Justice announced today.
“Unscrupulous dealers who roll back odometers cheat consumers out of their hard-earned money, affect informed buying choices, and raise safety concerns by misrepresenting the actual condition of the vehicles they sell,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “For many American consumers, the purchase of an automobile is one of the biggest purchases they make. The Department of Justice will continue to vigorously enforce consumer protection laws by bringing those who commit this crime to justice.”
Judith Ann Aloe, 56, previously residing in Lauderdale Lakes, Florida, was also ordered to pay restitution in the amount of $1.482 million to victims and serve three years of supervised release following her prison term. In June 2016, Aloe pleaded guilty to one count of conspiracy to tamper with odometers, make false odometer certifications, and commit securities fraud, and 11 counts each of securities fraud and making false odometer certifications. Aloe and a co-defendant, Kyle Novitsky, rolled back odometers on used cars and trucks to make the vehicles appear more valuable. Doing business under various company names, Aloe and Novitsky sold close to 250 vehicles with rolled back odometers.
Aloe was scheduled to stand trial on May 14, 2014, in U.S. District Court in Philadelphia, but when she failed to appear for trial, a bench warrant was issued for her arrest by Chief Judge Petrese B. Tucker. Aloe remained at large for 21 months. In February, she was located in Baja California, Mexico, and turned over to the U.S. Marshals Service at the Mexico-California border.
In April 2014, Aloe’s co-defendant, Kyle Novitsky, then 46, of Scott Township, Pennsylvania, pleaded guilty to several counts in the indictment. In October 2014, Novitsky was sentenced to 60 months in prison and also ordered to pay restitution in the amount of $1.482 million to victims.
Aloe admitted to participating in the purchase of high-mileage cars, sport-utility vehicles and trucks from various locations of a national car rental company. Aloe then worked with Novitsky to roll back and alter the odometers and resold the vehicles at wholesale automobile auctions in Pennsylvania. Aloe also caused to be altered the high mileages shown on the titles received from the car rental company to reflect false, low mileages and retitled the vehicles in Pennsylvania with false mileages. These titles were then given to the buyers so that the mileage on the titles matched the mileage shown on a vehicle’s odometer.
This case was prosecuted by Senior Litigation Counsel Linda I. Marks of the Civil Division’s Consumer Protection Branch and former Consumer Protection Branch Trial Attorney Jessica Gunder, now an Assistant U.S. Attorney in Idaho, with assistance from the U.S. Attorney’s Office in the Eastern District of Pennsylvania. The case was investigated by the National Highway Traffic Safety Administration’s (NHTSA) Office of Odometer Fraud Investigation.
More information on odometer fraud is available on the NHTSA’s website and tips on detecting and avoiding odometer fraud are available at this page. For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at http://www.justice.gov/civil/consumer-protection-branch.
California man indicted for mailing methamphetamine and heroin to AkronRead the Press Release
A California man was indicted for trafficking methamphetamine and heroin, U.S. Attorney Carole S. Rendon said.
Randolph Harris, 37, of Sacramento, was indicted on one count each of conspiracy to possess with intent to distribute methamphetamine and conspiracy to possess with intent to distribute heroin.
Harris mailed more than two kilograms of methamphetamine from California to Akron on Nov. 12. He also mailed more than 100 grams of heroin to Akron last month, according to the indictment.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant's role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant U.S. Attorney Henry F. DeBaggis following an investigation by the U.S. Postal Inspection Service.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
California Husband and Wife Indicted on Human Trafficking Charges Related to Forced Labor of Foreign NationalsRead the Press Release
Satish Kartan, 43, and his wife, Sharmistha Barai, 38, of Stockton, California, were indicted by a grand jury today for forced labor and conspiracy to commit forced labor. Kartan was also charged with fraud in contacting foreign labor and Barai was also charged with benefiting from forced labor.
Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division, and Acting U.S. Attorney Phillip A. Talbert of the Eastern District of California announced the indictment.
According to court documents, between Feb. 21, 2014, and Oct. 3, 2016, Kartan and Barai hired workers from overseas to perform domestic labor in their homes in Albuquerque, New Mexico; Stockton and elsewhere in the United States. In advertisements seeking workers on the internet and India-based newspapers, the defendants made false claims regarding the wages and the duties of employment. Once the workers arrived at the defendants’ residences, Kartan and Barai forced them to work 18 hours a day with limited rest and nourishment. The defendants did not pay wages and used force, physical restraint and coercive conduct to get the workers to perform the labor and services.
The indictment alleges that Kartan and Barai struck one worker on multiple occasions, including one incident where Kartan grabbed her hands and caused them to be burned over the flames of a gas stove. Moreover, the indictment alleges that the defendants failed to pay another worker and told her that they would call the police if she tried to leave. When she was ultimately able to arrange to be picked up from the defendants’ house, Kartan refused to provide her with the access code to the gated community so that her ride could enter.
On Oct. 21, 2016, Kartan and Barai were arrested on a criminal complaint and were released on bond with special conditions that prohibit them from hiring any nonrelatives to perform domestic services or child care work for them. The defendants are also prohibited from directly or indirectly contacting any of their prior domestic workers. Kartan and Barai are scheduled to be arraigned on Nov. 21, 2016.
If convicted, each defendant faces a maximum sentence of 20 years in prison and a $250,000 fine. An indictment is merely an allegation and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
This case is the product of an investigation by the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, the FBI, the State Department’s Diplomatic Security Service and the Stockton Police Department. Special Assistant U.S. Attorney Josh Sigal and Assistant U.S. Attorney Nirav Desai of the Eastern District of California are prosecuting the case, with the assistance of the Civil Rights Division’s Human Trafficking Prosecution Unit.
Sacramento is one of six districts designated through a competitive, nationwide selection process as a Phase II Anti-Trafficking Coordination Team, through the interagency ACTeam Initiative of the Departments of Justice, Homeland Security and Labor. ACTeams focus on developing high-impact human trafficking investigations and prosecutions involving forced labor, international sex trafficking and sex trafficking by force, fraud or coercion through interagency collaboration among federal prosecutors and federal investigative agencies.
Kartan Indictment