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Thursday 22 September 2016
Los Angeles Jury Convicts Medical Clinic Owner for Health Care Fraud and Tax FraudRead the Press Release
LOS ANGELES – A federal jury in Los Angeles has convicted the owner of a medical clinic for his role in a health care fraud scheme and for filing false income tax returns.
Michael Huynh, 57, of Encino, was convicted yesterday of one count of conspiracy to commit health care fraud and 11 counts of filing false tax returns after a seven-day trial before United States District Judge Otis D. Wright II. Huynh will be sentenced on January 30, 2017.
Evidence introduced at trial showed that Huynh, the office manager and part-owner of a medical clinic, provided false prescriptions to a pharmacist and co-conspirator, Farhad N. Dany Sharim, who submitted false claims to insurance companies for drugs that were never dispensed. Once Sharim received payments from the insurance companies, he paid Huynh for the false prescriptions. Trial evidence also showed that, between January 2004 and November 2009, Huynh received 82 checks from Sharim totaling over $1.1 million. Huynh filed false federal tax returns for tax years 2007 through 2011 that underreported by over $1.6 million in total the medical clinic’s gross receipts and sales on the corporate tax returns and income on the individual tax returns.
“This defendant played an integral role in a health care fraud scheme that netted over $1 million for drugs that were never prescribed or delivered,” said United States Attorney Eileen M. Decker. “Such massive fraudulent conduct impacts everyone who seeks medical care and who pays for health insurance, since it undermines the integrity of our health care system and preys on vulnerable members of our community. For that, this defendant and his co-conspirator must be held accountable.”
Sharim pleaded guilty to one count of conspiracy to commit health care fraud on November 18, 2013, and will be sentenced on December 5.
“The defendant carried out this fraud at the expense of many, to include his own family members whose identities were used to camouflage the scheme, as well as the patients at his clinic, many of whom are immigrants and did not know their insurance was being billed by a pharmacy they did not go to by a prescribing doctor they did not see, and for medications they did not receive,” said Deirdre Fike, the Assistant Director in Charge of the FBI’s Los Angeles Field Office. “Health care fraud investigators and prosecutors did an outstanding job of delivering justice to the defendant’s victims, including the patients at his clinic and the insurance companies who suffered losses.”
“The frauds engaged in by Mr. Huynh, both income tax fraud and health care fraud, have impacted programs that Americans depend upon as a part of their daily lives. These very same frauds have resulted in Mr. Huynh’s conviction,” stated IRS-Criminal Investigation Acting Special Agent in Charge Anthony J. Orlando. “Along with our law enforcement partners, IRS-Criminal Investigation is committed to bringing those who fraudulently take advantage of our nation’s programs to justice.”
The Federal Bureau of Investigation, IRS-CI and the Office of Personnel Management’s Office of Inspector General investigated the case, which was brought as part of the Medicare Fraud Strike Force, supervised by the U.S. Attorney’s Office of the Central District of California and the Department of Justice’s Fraud Section. Assistant United States Attorney Steven Arkow and Fraud Section Trial Attorney Alexis Gregorian prosecuted the case.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,900 defendants who have collectively billed the Medicare program for more than $10 billion. In addition, the Health and Human Services Centers for Medicare & Medicaid Services, working in conjunction with the Health and Human Services’ Office of Inspector General, are taking steps to increase accountability and decrease the presence of fraudulent providers.
“This conviction should act as a warning to those who believe they can defraud the government with impunity,” said Special Agent in Charge Scott Rezendes of the Office of Personnel Management Office of Inspector General (OPM-OIG). “The OPM Office of the Inspector General is committed to holding such individuals accountable for their actions.”
At sentencing, Huynh faces a statutory maximum sentence of 38 years in federal prison – five years for the conspiracy count and three years for each of 11 tax fraud counts. Sharim faces a maximum sentence of five years in federal prison.
Lexington Man Indicted for Possession with Intent to Distribute FentanylRead the Press Release
LEXINGTON, Ky, — A Lexington man, who will appear in Court this afternoon, has been charged with possession with intent to distribute large quantities of fentanyl in Fayette County.
William S. Dixon, 55, was indicted on September 9, 2016, by a federal grand jury, for one count of possession with intent to distribute fentanyl and one count of possession with intent to distribute acylfentanyl, fentanyl and heroin.
According to the indictment, in July of this year, Lexington Police conducted a search at Dixon’s residence and discovered at least 40 grams of pure fentanyl.
“We are fortunate to have seized this fentanyl before it was distributed,” said Kerry B. Harvey, U.S. Attorney for the Eastern District of Kentucky. “ Minute quantities of fentanyl can be deadly. Given the damage fentanyl has caused in central Kentucky, it’s staggering to consider the harm that would have been done by these drugs on the streets of our community.”
“This case represents the largest seizure of pure fentanyl to date for our agency,” Lexington Police Chief Mark Barnard said. “Families are hurting because of the abuse of fentanyl, heroin, and other opioids. We are continuing to investigate this case. This problem needs to be attacked from all sides. We’re working to bring drug dealers and their suppliers to justice, and we’re working with addiction intervention experts to help connect victims with the help they need.”
Dixon is an employee of the city’s Division of Water Quality. He is currently on paid leave due to an on-the-job injury that occurred in April.
U.S. Attorney Harvey; Timothy J. Plancon, Special Agent in Charge of the Detroit Field Division of the Drug Enforcement Administration; and Mark Barnard, Chief of Lexington Police, jointly made the announcement.
The investigation was conducted by Lexington Police and the DEA. Assistant U.S. Attorney Cindy Rieker is prosecuting this case on behalf of the federal government.
Dixon is scheduled for a detention hearing today at 2:00 in Lexington. At this hearing the Court will determine whether Dixon will remain in custody pending trial. If convicted, Dixon faces a minimum of 5 years and a maximum of 40 years in federal prison. However, any sentence imposed, upon a conviction, would come after the Court carefully considers the U.S. Sentencing Guidelines and the applicable statutes.
An indictment is an allegation only. All defendants are presumed innocent and are entitled to a fair trial, at which the government must prove their guilt beyond a reasonable doubt.
Leesburg Man Sentenced to More Than 30 Years for Committing Crimes of ViolenceRead the Press Release
Orlando, Florida – U.S. District Judge Carlos E. Mendoza has sentenced Dane Gillis (59, Leesburg) to 30 years and 5 months in federal prison for attempting to entice a minor to engage in sexual activity, soliciting an undercover federal agent to commit kidnapping, and transmitting interstate commerce threats to kidnap and injure a former co-worker. The Court also ordered Gillis to forfeit the electronic devices that he had used to commit the offenses.
Gillis was found guilty by a jury on May 12, 2016.
According to evidence presented at trial, Gillis posted an ad on Craigslist stating, “Looking for a guy or group who r into extremely taboo scenes. Hi risk and reward for the right sadistic Pervert.” An undercover federal agent responded to the ad and stated that he was the father of an 11-year-old daughter. Gillis communicated with the agent through email and text for two weeks. During these communications, Gillis made arrangements to have sex with the child and also solicited the agent to help him kidnap and rape a former co-worker.
On September 16, 2015, Gillis drove over an hour from his home to meet with the “father and child,” and was arrested. Forensic analyses of Gillis’s smartphone and computer, which he had brought to the meeting, revealed that Gillis had conducted Internet searches for kidnapping, rape, and for prepubescent child pornography. Gillis also had saved scores of pictures of the intended kidnapping victim on his computer. Through additional investigation, agents learned that Gillis had been soliciting individuals to help him kidnap and rape the victim for nearly a year.
This case was investigated by the Federal Bureau of Investigation. It was prosecuted by Assistant United States Attorneys Karen L. Gable and Emily C.L. Chang.
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.
Leader of Multimillion-Dollar Cocaine Trafficking Ring, Co-Conspirators Collectively Sentenced to More Than 120 YearsRead the Press Release
Memphis, TN – The ringleader of a multimillion-dollar cocaine trafficking ring has been sentenced to federal prison. Twenty co-conspirators were previously sentenced for their roles in the criminal enterprise; one remains a fugitive. Edward L. Stanton III, U.S. Attorney for the Western District of Tennessee, announced the sentences today.
The defendants and their respective sentences:
• Derrick Hester, 43, of Memphis, TN: 114 months
• Marcus Brown, 38, of Somerville, TN: Time served
• David Arnold, 34, of Horn Lake, MI: 135 months
• Torey Jackson, 48, of Memphis, TN: 2 years supervised release
• Julius Anthony Weaver, 32, of Memphis, TN: 70 months
• Brian Wallace Stewart, 36, of Memphis, TN: 41 months
• Ahmad Omar Majid, 42, of Atoka, TN: 30 months
• Joseph Bernard Taylor, 40, of Memphis, TN: 51 months
• Marco Dewayne Reed, 37, of Memphis, TN: 37 months
• Toramine Lavorid McKinnie, 35, of Brownsville, TN: 63 months
• William Norman Bass III, 29, of Bartlett, TN: 151 months
• Jacques Terell Bledsoe, 30, of Memphis, TN: 24 months
• John Ivory Bridges, 33, of Jonesboro, AK: Time served
• Javier Lopez Cantu, 49, of McAllen, TX: 87 months
• Amos Turner Jr., 61, of Memphis, TN: 33 months
• Justin Anthony Clark, 36, of Whiteville, TN: 30 months
• Lance Jerome Gaston, 38, of Cordova, TN: 151 months
• Jeremiah Gamble, 32, of Memphis, TN: 151 months
• Alejandro Sanchez, 29, of Brownsville, TX: 78 months
• Jesus Arnoldo Solis, 44, of Brownsville, TX: 144 months
• Humphrey Brooks, 39, of Memphis, TN: 84 months
• Antonio Caldwell, 31, of Memphis, TN: Fugitive
According to information presented in court, Hester spearheaded a drug trafficking organization responsible for importing and distributing more than 100 kilograms of cocaine throughout West Tennessee and abroad.
Between 2012 and 2014, law enforcement conducted "Operation Cocaine Lover," an investigation into the drug trafficking organization. Officers conducted extensive physical surveillance, controlled drug purchases, and wiretaps on members within the organization.
During the investigation, law enforcement discovered that massive amounts of cocaine were being transported from Texas to Memphis on a regular basis by Hester and Arnold. The cocaine would then be provided to co-conspirators in varying quantities, including kilograms, half-kilos and ounces. The drugs were subsequently distributed throughout the district.
One of the defendants, Taylor, attempted to bribe a Drug Enforcement Administration (DEA) Task Force officer during a traffic stop to avoid arrest. The stop resulted in the recovery of multiple ounces of cocaine and $31,590 in drug proceeds. Taylor attempted to persuade the officer to take the drugs and money and let him and a co-conspirator go free.
In addition to distributing cocaine, defendants Hester and Arnold were also engaged in money laundering. Hester made large monetary deposits into accounts at SunTrust Bank and Bank of America through two companies he established to conceal his illicit activity.
Arnold obtained a $230,000 mortgage to purchase a house. He used drug proceeds to make payments on the house between late 2010 and 2013. The house was used to store drugs and conduct drug sales.
More than $370,000 in drug proceeds was seized during the investigation, along with multiple residential properties and vehicles.
Each defendant, excluding Caldwell, pleaded guilty to charges within the indictment.
Between September 2015 and September 2016, all of the defendants were sentenced. The sentences collectively amount to more than 120 years in federal prison.
This case was investigated by the DEA; IRS-Criminal Investigation; United States Marshals Service; the Memphis, Bartlett, Germantown and Collierville Police Departments; and the Shelby County and Tipton County Sheriff’s Offices.
Assistant U.S. Attorney Jerry Kitchen prosecuted this case on the government’s behalf.
Keshena, WI Man Indicted on Sex Offender Registry ChargeRead the Press Release
Gregory J. Haanstad, United States Attorney for the Eastern District of Wisconsin, announced that on September 20, 2016, a federal grand jury returned a one-count indictment against John Mendoza (age: 39) of Keshena charging him with a violation of the Sex Offender Registration and Notification Act (18 United States Code Section 2250). If convicted of the offense, the defendant faces a sentence of up to 10 years’ imprisonment, a $250,000 fine, and from 5 years up to lifetime Supervised Release.
According to the indictment, Mendoza, failed to comply with the sex offender registry from June 2016 through August 11, 2016.
The case was investigated by the Menominee Tribal Police Department, Wisconsin Department of Corrections Sex Offender Registry Program, United States Probation Office, and United States Marshals Service. The case is being prosecuted by Assistant United States Attorney Andrew J. Maier.
An indictment is only a charge and not evidence of guilt. Every defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
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Keshena, WI Man Indicted on Assault ChargeRead the Press Release
Gregory J. Haanstad, United States Attorney for the Eastern District of Wisconsin, announced that on September 20, 2016, a federal grand jury returned a one-count indictment against Bryant Waupoose, Sr. (age: 47) of Keshena, Wisconsin, charging him with Assault Resulting in Serious Bodily Harm in violation of 18 United States Code Sections 113(a)(6) and 1153(a). If convicted of the offense, the defendant faces a sentence of up to 10 years’ imprisonment, a $250,000 fine, and up to 3 years of Supervised Release.
According to the indictment, Waupoose, punched and kicked a man on or about July 31, 2016, leading to the man suffering a broken jaw and fractured foot. The incident occurred in Keshena on the Menominee Indian Reservation.
The case was investigated by the Menominee Tribal Police Department and the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorney Andrew J. Maier.
An indictment is only a charge and not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
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Justice Department and Law Enforcement Partners Announce Civil and Criminal Actions to Dismantle Global Network of Mass Mailing Fraud Schemes Targeting Elderly and Vulnerable VictimsRead the Press Release
Government Agencies and Non-Profits Collaborate to Launch Public Education Campaign
The Justice Department, in coordination with the U.S. Postal Inspection Service (USPIS), the Department of the Treasury’s Office of Foreign Assets Control (OFAC) and other law enforcement partners, today announced wide-ranging enforcement actions – including criminal charges, economic sanctions, seizure of criminal proceeds and civil injunction lawsuits – along with the execution of search warrants to combat a global network of mass mailing fraud schemes that collectively have defrauded millions of elderly and vulnerable victims across the United States out of hundreds of millions of dollars. Simultaneously, a consortium of government agencies and non-profit groups led by the department’s Consumer Protection Branch and Elder Justice Initiative announced a public education campaign to heighten public awareness and educate potential victims and their families about these schemes.
The actions announced today are part of a broader effort by the department and its international law enforcement partners to attack fraud schemes targeting older Americans and other vulnerable populations that involve individuals and entities across the globe, including Canada, France, India, the Netherlands, Singapore, Switzerland, Turkey and the United States.
“Every year, fraudulent mail schemes target millions of Americans with false promises of wealth and riches, swindling hundreds of thousands of our fellow citizens,” said Attorney General Loretta E. Lynch. “Today’s actions send a clear message that the Department of Justice is determined to hold the perpetrators of these harmful schemes accountable. And they make unmistakably clear that we are committed to protecting our people from exploitation – especially our older citizens, who are so often the focus of these shameful ruses. I want to thank our partners across the federal government for their assistance in bringing these actions, and I pledge the department’s ongoing dedication to ending mail fraud.”
“The law enforcement and civil injunction efforts announced today are just a part of our initiative,” said Postal Service’s Chief Postal Inspector Guy Cottrell. “We believe that consumer education is the best defense against these scammers. We can’t arrest all of these con artists, so preventing the crime is critical.”
The mail schemes involve a complicated web of actors located across the world and each scheme follows a similar pattern. Fraudulent “direct mailers” create letters falsely claiming that the recipient has won, or will soon win, cash or valuable prizes, or otherwise will come into good fortune. In order to collect these benefits, the letters say that the recipients need only send in a small amount of money for a processing fee or taxes. The letters appear to come from legitimate sources, typically on official-looking letterhead, and – even though they are in reality identical form letters – the letters appear to be personally addressed. Some solicitations even use fonts that appear to be handwritten.
Today’s actions include both criminal and civil cases against multiple “direct mailers” who, collectively, are responsible for dozens of schemes involving tens of millions of dollars every year. In addition, today’s actions also seek to shut down several other actors who work with the mailers to carry out these schemes: an India-based printer that manufactures the solicitations and arranges for bulk shipment to U.S. victims; list brokers who buy, sell or rent lists of victims from one mailer to another so that once a victim has fallen prey to one scheme, others are able to target this victim; and a Canadian payment processor that, for more than 20 years, has helped dozens of international fraudsters gain access to U.S. banks and take money from victims.
“The Civil Division’s Consumer Protection Branch is working with international and domestic law enforcement through the International Mass-Marketing Fraud Working Group to dismantle these complex frauds through both civil and criminal actions,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “And we will continue to work with federal partners and non-governmental organizations to educate the public about this threat to vulnerable consumers.”
“The defendants targeted the elderly and vulnerable by selling false promises of cash and lavish prizes,” said U.S. Attorney Robert L. Capers for the Eastern District of New York. “Not surprisingly, the only good fortune befell the defendants. We will employ every available means, including educating consumers, to protect the public from these schemes.”
Actions against Canadian Payment Processor
The Justice Department, OFAC, and USPIS took simultaneous actions today against PacNet Services Ltd. (PacNet), an international payments processor and money services business based in Vancouver, Canada, along with affiliate companies and their operators. Today OFAC designated the PacNet Group as a significant transnational criminal organization (TCO) pursuant to Executive Order (E.O.) 13581, “Blocking Property of Transnational Criminal Organizations.” OFAC is also designating a global network of 12 individuals and 24 entities across 18 countries. As a result of today’s action, all property and interests in property of the designated persons subject to U.S. jurisdiction are blocked, and U.S. persons are prohibited from engaging in transactions with them.
In addition, USPIS has sought and obtained a seizure warrant in the U.S. District Court for the Eastern District of New York for the funds in a PacNet U.S. bank account that is used to process payments received through fraudulent mailings. The matter is being investigated by the USPIS team assigned to the Consumer Protection Branch, in conjunction with the USPIS’s Newark Division, Internal Revenue Service-Criminal Investigation’s Newark Field Office and Homeland Security Investigation’s El Dorado Money Laundering Task Force.
According to court filings made public today, PacNet has a 20-year history of engaging in money laundering and mail fraud, by knowingly processing payments on behalf of a wide range of mail fraud schemes that target victims in the United States and throughout the world. According to these records, in 2016 alone, PacNet has processed payments for the perpetrators of more than 100 different mail fraud campaigns, collectively involving tens of millions of dollars. In doing so, PacNet provides fraudsters in other countries with unfettered access to U.S. banks. The records also identify PacNet as the processor for each of the defendants named in the cases announced by the Department today.
“PacNet has knowingly facilitated the fraudulent activities of its customers for many years, and today’s designations are aimed at shielding Americans and the nation’s financial system from the large-scale, illicit money flows that are generated by these scams against vulnerable individuals,” said OFAC Acting Director John E. Smith. “Treasury will continue to use its authorities to respond to the evolving nature of transnational organized crime.”
Criminal Charges and Civil Injunction Action Filed against Turkish Direct Mailer
In a criminal complaint filed in the U.S. District Court for the Eastern District of New York, the government charged Ercan Barka, 34, a resident of Turkey, with conspiracy to commit mail fraud.According to the criminal complaint, Barka arranged for fraudulent solicitations to be mass-mailed to victims across the United States.The fraudulent solicitations told recipients that they had won cash awards or lavish prize items and needed to pay a “fee” to claim their winnings.Victims allegedly received nothing in return for their fees.Barka was arrested by U.S. Postal Inspectors at JFK International Airport in New York on Sept. 3, as he was about to board a plane bound for Turkey.
The government also brought a civil injunction action under the Anti-Fraud Injunction Statute against Barka and True Vision LLC, a Delaware-based corporation through which he operates.The civil complaint seeks to preliminarily and permanently ban Barka from participating in mail fraud schemes.The complaint alleges that Barka sends millions of fraudulent mailings to potential U.S. victims each year and that, since 2012, U.S. victims have paid more than $29 million to Barka’s mailing campaigns.
Civil Action under the Anti-Fraud Injunction Statute against Swiss/Singaporean Direct Mailer, Indian Printer and Connecticut “List Broker”
In a separate civil action, the United States brought suit to shut down entities and individuals, some of whom have engaged in numerous predatory mail fraud schemes for more than a decade, targeting primarily the elderly and vulnerable. First, the complaint names BDK Mailing GmbH, Mailing Force Pte. Ltd. and Only Three Pte. Ltd. (collectively BDK). These entities, under common ownership, are based in Switzerland and Singapore. The complaint also names BDK’s principals, Chantal Seguy, 58, and Marion Elchlepp, 25, both of Paris, and Aurore Jouffroy, of Zurich. BDK acts as a “direct mailer” responsible for mailing millions of multi-piece solicitations to potential victims throughout the United States that profess to come from financial entities, scholars and world-renowned psychics, with contrived names like “Harrison Institute,” “Dr. Grant,” “Finkelstein & Partner,” and “Marie de Fortune,” among others. The solicitations are written to give the impression that they are personalized and inform recipients that they will receive large sums of money, guaranteed money-making methods and/or powerful talismans in return for payment of a fee of $50 to $55. In reality, the complaint alleges, the purported senders and the promised winnings are fictitious. Although victims send in the requested fees by cash, check or credit card, they receive nothing in return. The complaint alleges that tens of thousands of victims send approximately $50 to $60 million annually in response to the defendants’ fraudulent solicitation packets.
In addition, the complaint names Macromark Inc., a Connecticut-based list broker that has marketed BDK’s lead lists to third-party direct mailers, and Mary Ellen Meyer, 45, of Mahopac, New York, a Macromark client service manager. The complaint alleges that Macromark and Meyer have rented lead lists to BDK and other fraudulent direct mailers who Macromark and Meyer knew would use the lists to personalize and address hundreds of thousands of solicitation packets to potential victims across the United States. Macromark marketed the lead lists as containing the demographic information of individuals likely to send money in response to the solicitations. The lists collectively contained approximately 750,000 potential victim names and addresses, according to the complaint.
Finally, the complaint names Mail Order Solutions India Pvt. Ltd. (MOSI), an India-based printer and distributor, and its principals, Dharti Desai, 49, of New York County and Mumbai, India, and Mehul Desai, also of Mumbai. As alleged in the complaint, MOSI and its principals have served as one of BDK’s printer/distributors since at least 2005. MOSI designs, edits and proofreads BDK’s solicitations, then “lettershops” them (folds, inserts and seals the various printed elements of the solicitations into mailing envelopes). MOSI prepares the letters for entry into the U.S. mail either as air freight to JFK (or another international airport) for delivery to a domestic mailing house, or by shipping the letters to Singapore, Fiji or Hungary for introduction via the foreign post. The complaint alleges that since 2013, MOSI has shipped at least 24.5 million solicitation packets to the United States.
Civil Action under the Anti-Fraud Injunction Statute against New York Direct Mailer
In another civil injunction action, the department seeks to stop a collection of businesses and individuals who have operated a direct mailing scheme based out of Long Island, New York, since at least 2012. The complaint alleges that DMCS Inc., Direct Marketing Consulting Services Inc., Horizon Marketing Services Inc. (Horizon), Quantum Marketing Inc. (Quantum) and their principals, Sean Novis, 46; Gary Denkberg, 53; and Cathy Johnson, 34, all of Nassau County, New York, committed mail fraud in connection with their scheme. The complaint alleges that the defendants send fraudulent solicitations styled as notifications that the recipient has won a large cash prize, typically worth more than $1 million. The complaint alleges that the defendants mail hundreds of thousands of solicitations to potential victims throughout the United States every year and have grossed roughly $30.4 million since 2012.
Consent Decree Entered against Dutch “Caging Service”
Also today, the department announced that the U.S. District Court for the Eastern District of New York entered a consent decree of permanent injunction against two Dutch caging businesses and their principal, Erik Dekker, 54, of Langbroek, the Netherlands, to prevent them from assisting mass-mailing fraud schemes. The businesses – Kommunikatie Service Buitenland B.V. (KSB) and Trends Service in Kommunikatie B.V. – are known collectively as Trends. The complaint, which was filed June 1, alleged that Trends and Dekker used P.O. boxes in the Netherlands from which they collected tens of millions of dollars in victim payments for multiple international mail fraud schemes, tracked victims’ information and forwarded proceeds to PacNet for processing.
Also on June 1, Dutch law enforcement agents executed search warrants on the business address used by both companies and on Dekker’s home address. The Dutch authorities also took control of the Dutch P.O. boxes used by the defendants to receive victim funds. The coordinated U.S. and Dutch enforcement actions immediately stopped the use of Dutch P.O. boxes to receive payments from fraud victims. Further investigation revealed that Trends was providing caging services for the Barka and BDK schemes targeted in today’s actions.
Trends and Dekker agreed to settle the litigation and be bound by a consent decree of permanent injunction that prohibits them from performing caging services for prize or psychic mailing campaigns, or any other mailing campaign that misrepresents itself to consumers. The injunction also allows USPIS to intercept U.S. mail headed to the defendants, and to return that mail – along with any money being sent to the defendants – to U.S. victims.
Criminal Charges against Nevada Mass Mailer
On Sept. 20, pursuant to a 24-count indictment unsealed that day, Glen Burke, 56, of Las Vegas, was arrested on charges related to operating fraudulent schemes including a mass-mailing prize campaign that violated a federal court order. According to the charges, Burke’s business mailed solicitations designed to fool recipients into believing that they had won thousands or millions of dollars. The solicitations allegedly used fictitious names and in many cases looked like they came from law firms or financial institutions. The indictment alleges that the solicitations advised consumers to pay a fee – usually $20 to $30 – in order to claim their winnings. Once consumers paid, however, Burke allegedly failed to send anyone their promised winnings of thousands or millions of dollars.
The indictment also charges Burke and a co-defendant, Michael Rossi, 51, of Las Vegas, with running a fraudulent telemarketing campaign that mirrored the mass-mailing campaign. Rossi was also arrested on Sept. 20. According to the indictment, telemarketers hired by Burke and Rossi falsely told consumers that they had been selected to receive a valuable prize worth thousands of dollars, and that they would receive the prize if they bought certain products. Burke and Rossi are charged with conspiracy, mail fraud and wire fraud in connection with telephone promotions.
The indictment includes criminal contempt charges against Burke, which stem from a court order entered as part of a Federal Trade Commission (FTC) case brought in 1997, in which the FTC successfully obtained an order that barred Burke from misrepresenting material information to consumers. Criminal contempt of court has no statutory maximum penalty.
In addition to the contempt charges, Burke and Rossi are each charged with 16 counts of wire fraud, five counts of mail fraud and one count of conspiracy. Each of these counts carries a statutory maximum penalty of 20 years in prison. The indictment also seeks forfeiture of criminal proceeds.
FTC Action against California Mailer, Florida Printer and Florida List Broker
The FTC filed a case today in U.S. District Court for the Central District of California against Terry Somenzi, 74, of Los Angeles, who did business through a company called International Advisory Services Inc.; David Raff, 54, of Weston, Florida, and his company, Millennium Direct Inc., also doing business as MDI Lists; and Ian Gamberg, 37, also of Weston, doing business through Printmail Corporate Solutions Inc. As alleged in the FTC’s complaint, since at least 2013, the defendants participated in mailing hundreds of thousands of cash prize notifications from fictitious companies, including Paulson Independent Distributors, International Procurement Center, Keller, Sloan & Associates and Phelps Ingram Distributors, informing mostly elderly consumers that they won a substantial cash prize of nearly $1 million or more. The notifications instruct consumers to pay a fee of approximately $25 to collect their prizes, but those who paid received nothing in return. According to the complaint, Somenzi and Raff, directly and through third-parties, provided the cash prize notifications and mailing lists of consumers’ names and addresses to Gamberg, who then arranged to have the notifications printed and mailed. Many consumers who paid the “fees” later received numerous other deceptive personalized cash prize notifications from the defendants and other companies who purchased lists containing the consumers’ personal information.
“In the 21st century, the scam in your mailbox just as likely comes from the other side of the world as from the other side of town,” said Director Jessica Rich of the FTC’s Bureau of Consumer Protection. “The FTC’s efforts to protect consumers don’t stop at our borders; we work with partners around the world against the perpetrators of mass mailing fraud. Regardless of where the fraud comes from, we encourage consumers to let us know if they have been scam victims; we share complaint information with our law enforcement partners in the United States. and abroad. Report your complaint at www.ftc.gov, or, for international scams, at the 36-agency joint website www.econsumer.gov.”
Iowa Attorney General Actions against List Broker and Direct Mailers
The Iowa State Attorney General took action today against fraudulent mass mailers and others facilitating their schemes. It negotiated an Assurance of Voluntary Compliance (AVC) with list broker Macromark to resolve allegations that the company facilitated fraudulent activities on the part of operations that mailed deceptive solicitations relating to sweepstakes and psychics. The AVC with Macromark requires it to refrain from any facilitation of such fraudulent activities affecting Iowa residents and to pay $30,000 into a fund that protects elderly Iowans against consumer fraud.
The Iowa Attorney General also brought an action under the Iowa Consumer Fraud Act seeking an injunction, restitution and other relief against Waverly Direct Inc., and its owner, Gordon Shearer, a New York-based direct mailer. Shearer and his company allegedly sent out deceptive mailings from the so-called “Numerological Resource Center.” These defendants maintain lists of vulnerable people who fell prey to their schemes, according to Iowa's lawsuit, and market these lists to other mass mailers through a list broker.
Finally, the Iowa Attorney General brought a lawsuit under the Iowa Consumer Fraud Act against Nicholas Valenti of Nevada. Valenti has allegedly been involved in marketing the rights to send out deceptive mailings regarding techniques for winning lotteries and other chance-dominated gaming activities.
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The charges and allegations in the indictments and criminal complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty. The claims made in the civil complaints are allegations only, and there has been no determination of liability.
Public Education
Reflecting the government’s unified effort to combat elder financial exploitation, the Consumer Protection Branch and Elder Justice Initiative have spearheaded a multi-agency education campaign to inform the public about mass mailing fraud and how it can be avoided. Agency partners include the USPIS, the FTC, the Consumer Financial Protection Bureau, the Social Security Administration, the Securities and Exchange Commission, the Commodities Futures Trading Commission and USA.gov. As described in detail in the fact sheet, each agency is using its means of public outreach to broadcast information about the prevalence of mass mailing fraud. The outreach includes messages to caregivers – such as friends, relatives, social workers and others in contact with older individuals – about the need to be vigilant against prize or psychic letters being sent to those under their care.
In addition, and as described in detail in the fact sheet, the government has also joined forces with non-governmental organizations in the elder justice and consumer protection arena, each of which will contribute to the public education campaign. These groups include AARP, Consumers Union, Consumer Federation of America, the Elder Justice Coalition, Meals on Wheels Association of America, National Adult Protection Services Association, National Association of Area Agencies on Aging (n4a), National Association of States United for Aging and Disabilities, National Center for Victims of Crime and National Consumers League. Using their vast networks and communication tools, these organizations will alert their members and the public to the scourge of mass mailing fraud schemes and offer tips to combat financial exploitation. Their tools include websites, newsletters, social media channels, training and outreach events and other means.
U.S. law enforcement’s actions against mass-mailing fraud arise out of a larger worldwide effort. Mass-mailing fraud has been identified as a major financial threat by the International Mass-Marketing Fraud Working Group (IMMFWG), a network of civil and criminal law enforcement agencies from Australia, Belgium, Canada, Europol, the Netherlands, Nigeria, Norway, Spain, the United Kingdom and the United States. The IMMFWG is co-chaired by the U.S. Department of Justice and FTC, and law enforcement in the United Kingdom. Recent actions have been taken by law enforcement agencies from several working group countries, including Belgium, Canada, the Netherlands and the United Kingdom, to disrupt mass mailing fraud schemes and gather evidence for prosecution of criminal participants. Through these efforts, the working group serves as a model for international cooperation against specific threats that endanger the financial well-being of each country’s residents.
More information on fraud against the elderly is available at https://www.justice.gov/elderjustice/. For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at http://www.justice.gov/civil/consumer-protection-branch.
Justice Department and Law Enforcement Partners Announce Civil and Criminal Actions to Dismantle Global Network of Mass Mailing Fraud Schemes Targeting Elderly and Vulnerable VictimsRead the Press Release
WASHINGTON – The Justice Department, in coordination with the U.S. Postal Inspection Service (USPIS), the Department of the Treasury’s Office of Foreign Assets Control (OFAC), and other law enforcement partners, today announced wide-ranging enforcement actions – including criminal charges, economic sanctions, seizure of criminal proceeds, and civil injunction lawsuits – along with the execution of search warrants to combat a global network of mass mailing fraud schemes that collectively have defrauded millions of elderly and vulnerable victims across the United States out of hundreds of millions of dollars. Simultaneously, a consortium of government agencies and non-profit groups led by the Department’s Consumer Protection Branch and Elder Justice Initiative announced a public education campaign to heighten public awareness and educate potential victims and their families about these schemes.
The actions announced today are part of a broader effort by the Department and its international law enforcement partners to attack fraud schemes targeting older Americans and other vulnerable populations that involve individuals and entities across the globe, including Canada, France, India, the Netherlands, Singapore, Switzerland, Turkey, and the United States.
“Every year, fraudulent mail fraud schemes target millions of Americans with false promises of wealth and riches, swindling hundreds of thousands of our fellow citizens,” said Attorney General Loretta E. Lynch. “Today’s actions send a clear message that the Department of Justice is determined to hold the perpetrators of these harmful schemes accountable. And they make unmistakably clear that we are committed to protecting our people from exploitation – especially our older citizens, who are so often the focus of shameful ruses. I want to thank our partners across the federal government for their assistance in bringing these actions, and I pledge the department’s ongoing dedication to ending mail fraud.”
“The defendants targeted the elderly and vulnerable by selling false promises of cash and lavish prizes,” said U.S. Attorney Robert L. Capers for the Eastern District of New York. “Not surprisingly, the only good fortune befell the defendants. We will employ every available means, including educating consumers, to protect the public from these schemes.”
“The law enforcement and civil injunction efforts announced today are just a part of our initiative,” said Postal Service’s Chief Postal Inspector Guy Cottrell. “We believe that consumer education is the best defense against these scammers. We can’t arrest all of these con artists, so preventing the crime is critical.”
The mail schemes involve a complicated web of actors located across the world and each scheme follows a similar pattern. Fraudulent direct mailers create letters falsely claiming that the recipient has won, or will soon win, cash or valuable prizes, or otherwise will come into good fortune. In order to collect these benefits, the letters say that the recipients need only send in a small amount of money for a processing fee or taxes. The letters appear to come from legitimate sources, typically on official-looking letterhead, and – even though they are in reality identical form letters – the letters appear to be personally addressed. Some solicitations even use fonts that appear to be handwritten.
Today’s actions include both criminal and civil cases against multiple direct mailers who, collectively, are responsible for dozens of schemes involving tens of millions of dollars every year. In addition, today’s actions also seek to shut down several other actors who work with the mailers to carry out these schemes: an India-based printer that manufactures the solicitations and arranges for bulk shipment to U.S. victims; list brokers who buy, sell, or rent lists of victims from one mailer to another so that once a victim has fallen prey to one scheme, others are able to target this victim; and a Canadian payment processor that, for more than 20 years, has helped dozens of international fraudsters gain access to U.S. banks and take money from victims.
“The Civil Division’s Consumer Protection Branch is working with international and domestic law enforcement through the International Mass-Marketing Fraud Working Group to dismantle these complex frauds through both civil and criminal actions,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “And we will continue to work with federal partners and non-governmental organizations to educate the public about this threat to vulnerable consumers.”
Actions against Canadian Payment Processor
The Justice Department, OFAC, and USPIS took simultaneous actions today against PacNet Services Ltd. (PacNet), an international payments processor and money services business based in Vancouver, Canada, along with affiliate companies and their operators. Today OFAC designated the PacNet Group as a significant transnational criminal organization (TCO) pursuant to Executive Order (E.O.) 13581, “Blocking Property of Transnational Criminal Organizations.” OFAC is also designating a global network of 12 individuals and 24 entities across 18 countries. As a result of today’s action, all property and interests in property of the designated persons subject to U.S. jurisdiction are blocked, and U.S. persons are prohibited from engaging in transactions with them.
In addition, USPIS has sought and obtained a seizure warrant in the U.S. District Court for the Eastern District of New York for the funds in a PacNet U.S. bank account that is used to process payments received through fraudulent mailings. The matter is being investigated by the USPIS team assigned to the Consumer Protection Branch, in conjunction with the USPIS’s Newark Division, Internal Revenue Service-Criminal Investigation’s Newark Field Office, and Homeland Security Investigation’s El Dorado Money Laundering Task Force. The seizure is being handled by Assistant U.S. Attorney Tanisha Payne of the U.S. Attorney’s Office for the Eastern District of New York and Assistant Director Richard Goldberg of the Civil Division’s Consumer Protection Branch.
According to court filings made public today, PacNet has a 20-year history of engaging in money laundering and mail fraud, by knowingly processing payments on behalf of a wide range of mail fraud schemes that target victims in the United States and throughout the world. According to these records, in 2016 alone, PacNet has processed payments for the perpetrators of more than 100 different mail fraud campaigns, collectively involving tens of millions of dollars. In doing so, PacNet provides fraudsters in other countries with unfettered access to U.S. banks. The records also identify PacNet as the processor for each of the defendants named in the cases announced by the Department today.
“PacNet has knowingly facilitated the fraudulent activities of its customers for many years, and today’s designations are aimed at shielding Americans and the nation’s financial system from the large-scale, illicit money flows that are generated by these scams against vulnerable individuals,” said OFAC Acting Director John E. Smith. “Treasury will continue to use its authorities to respond to the evolving nature of transnational organized crime.”
Criminal Charges and Civil Injunction Action Filed against Turkish Direct Mailer
In a criminal complaint filed in the U.S. District Court for the Eastern District of New York, the government charged Ercan Barka, 34, a resident of Turkey, with conspiracy to commit mail fraud. According to the criminal complaint, Barka arranged for fraudulent solicitations to be mass mailed to victims across the United States. The fraudulent solicitations told recipients that they had won cash awards or lavish prize items and needed to pay a fee to claim their winnings. Victims allegedly received nothing in return for their fees. Barka was arrested by U.S. Postal Inspectors at JFK International Airport in New York on Sept. 3, as he was about to board a plane bound for Turkey.
The government also brought a civil injunction action under the Anti-Fraud Injunction Statute against Barka and True Vision LLC, a Delaware-based corporation through which he operates. The civil complaint seeks to preliminarily and permanently ban Barka from participating in mail fraud schemes. The complaint alleges that Barka sends millions of fraudulent mailings to potential U.S. victims each year and that, since 2012, U.S. victims have paid more than $29 million to Barka’s mailing campaigns.
The United States’ civil injunction action is being handled by Assistant U.S. Attorneys Jessica Sklarsky and John Vagelatos of the U.S. Attorney’s Office for the Eastern District of New York, and Trial Attorney Ann F. Entwistle of the Civil Division’s Consumer Protection Branch.
Civil Action under the Anti-Fraud Injunction Statute against Swiss/Singaporean Direct Mailer, Indian Printer, and Connecticut “List Broker”
In a separate civil action, the United States brought suit to shut down entities and individuals, some of whom have engaged in numerous predatory mail fraud schemes for more than a decade, targeting primarily the elderly and vulnerable. First, the complaint names BDK Mailing GmbH, Mailing Force Pte. Ltd., and Only Three Pte. Ltd. (collectively BDK). These entities, under common ownership, are based in Switzerland and Singapore. The complaint also names BDK’s principals, Chantal Seguy, 58, and Marion Elchlepp, 25, both of Paris, and Aurore Jouffroy, of Zurich. BDK acts as a direct mailer responsible for mailing millions of multi-piece solicitations to potential victims throughout the United States that profess to come from financial entities, scholars, and world-renowned psychics, with contrived names like “Harrison Institute,” “Dr. Grant,” “Finkelstein & Partner,” and “Marie de Fortune,” among others. The solicitations are written to give the impression that they are personalized and inform recipients that they will receive large sums of money, guaranteed money-making methods, and/or powerful talismans in return for payment of a fee of $50 to $55. In reality, the complaint alleges, the purported senders and the promised winnings are fictitious. Although victims send in the requested fees by cash, check, or credit card, they receive nothing in return. The complaint alleges that tens of thousands of victims send approximately $50 to $60 million annually in response to the defendants’ fraudulent solicitation packets.
In addition, the complaint names Macromark Inc., a Connecticut-based list broker that has marketed BDK’s lead lists to third-party direct mailers, and Mary Ellen Meyer, 45, of Mahopac, New York, a Macromark client service manager. The complaint alleges that Macromark and Meyer have rented lead lists to BDK and other fraudulent direct mailers who Macromark and Meyer knew would use the lists to personalize and address hundreds of thousands of solicitation packets to potential victims across the United States. Macromark marketed the lead lists as containing the demographic information of individuals likely to send money in response to the solicitations. The lists collectively contained approximately 750,000 potential victim names and addresses, according to the complaint.
Finally, the complaint names Mail Order Solutions India Pvt. Ltd. (MOSI), an India-based printer and distributor, and its principals, Dharti Desai, 49, of New York County and Mumbai, India, and Mehul Desai, also of Mumbai. As alleged in the complaint, MOSI and its principals have served as one of BDK’s printer/distributors since at least 2005. MOSI designs, edits, and proofreads BDK’s solicitations, then lettershops them (folds, inserts, and seals the various printed elements of the solicitations into mailing envelopes). MOSI prepares the letters for entry into the U.S. mail either as air freight to JFK (or another international airport) for delivery to a domestic mailing house, or by shipping the letters to Singapore, Fiji, or Hungary for introduction via the foreign post. The complaint alleges that since 2013, MOSI has shipped at least 24.5 million solicitation packets to the United States.
The United States’ action is being handled by Assistant U.S. Attorneys Thomas Price and John Vagelatos of the U.S. Attorney’s Office for the Eastern District of New York, and Trial Attorney Gabriel H. Scannapieco of the Civil Division’s Consumer Protection Branch.
Civil Action under the Anti-Fraud Injunction Statute against New York Direct Mailer
In another civil injunction action, the Department seeks to stop a collection of businesses and individuals who have operated a direct mailing scheme based out of Long Island, New York, since at least 2012. The complaint alleges that DMCS Inc., Direct Marketing Consulting Services Inc., Horizon Marketing Services Inc. (Horizon), Quantum Marketing Inc. (Quantum), and their principals, Sean Novis, 46; Gary Denkberg, 53; and Cathy Johnson, 34, all of Nassau County, New York, committed mail fraud in connection with their scheme. The complaint alleges that the defendants send fraudulent solicitations styled as notifications that the recipient has won a large cash prize, typically worth more than $1 million. The complaint alleges that the defendants mail hundreds of thousands of solicitations to potential victims throughout the United States every year and have grossed roughly $30.4 million since 2012.
The United States’ action is being handled by Assistant U.S. Attorneys Sean Greene and John Vagelatos of the U.S. Attorney’s Office for the Eastern District of New York, and Trial Attorney Ann F. Entwistle of the Civil Division’s Consumer Protection Branch.
Consent Decree Entered against Dutch “Caging Service”
Also today, the Department announced that the U.S. District Court for the Eastern District of New York entered a consent decree of permanent injunction against two Dutch caging businesses and their principal, Erik Dekker, 54, of Langbroek, the Netherlands, to prevent them from assisting mass mailing fraud schemes. The businesses – Kommunikatie Service Buitenland B.V. (KSB) and Trends Service in Kommunikatie B.V. – are known collectively as Trends. The complaint, which was filed June 1, alleged that Trends and Dekker used P.O. boxes in the Netherlands from which they collected tens of millions of dollars in victim payments for multiple international mail fraud schemes, tracked victims’ information and forwarded proceeds to PacNet for processing.
Also on June 1, Dutch law enforcement agents executed search warrants on the business address used by both companies and on Dekker’s home address. The Dutch authorities also took control of the Dutch P.O. boxes used by the defendants to receive victim funds. The coordinated U.S. and Dutch enforcement actions immediately stopped the use of Dutch P.O. boxes to receive payments from fraud victims. Further investigation revealed that Trends was providing caging services for the Barka and BDK schemes targeted in today’s actions.
Trends and Dekker agreed to settle the litigation and be bound by a consent decree of permanent injunction that prohibits them from performing caging services for prize or psychic mailing campaigns, or any other mailing campaign that misrepresents itself to consumers. The injunction also allows USPIS to intercept U.S. mail headed to the defendants, and to return that mail – along with any money being sent to the defendants – to U.S. victims.
The United States’ action was handled by Assistant U.S. Attorney John Vagelatos of the U.S. Attorney’s Office for the Eastern District of New York and Trial Attorney Kerala Thie Cowart of the Civil Division’s Consumer Protection Branch.
Criminal Charges against Nevada Mass Mailer
On Sept. 20, pursuant to a 24-count indictment unsealed that day, Glen Burke, 56, of Las Vegas, was arrested on charges related to operating fraudulent schemes including a mass mailing prize campaign that violated a federal court order. According to the charges, Burke’s business mailed solicitations designed to fool recipients into believing that they had won thousands or millions of dollars. The solicitations allegedly used fictitious names and in many cases looked like they came from law firms or financial institutions. The indictment alleges that the solicitations advised consumers to pay a fee – usually $20 to $30 – in order to claim their winnings. Once consumers paid, however, Burke allegedly failed to send anyone their promised winnings of thousands or millions of dollars.
The indictment also charges Burke and a co-defendant, Michael Rossi, 51, of Las Vegas, with running a fraudulent telemarketing campaign that mirrored the mass mailing campaign. Rossi was also arrested on Sept. 20. According to the indictment, telemarketers hired by Burke and Rossi falsely told consumers that they had been selected to receive a valuable prize worth thousands of dollars, and that they would receive the prize if they bought certain products. Burke and Rossi are charged with conspiracy, mail fraud, and wire fraud in connection with telephone promotions.
The indictment includes criminal contempt charges against Burke, which stem from a court order entered as part of a Federal Trade Commission (FTC) case brought in 1997, in which the FTC successfully obtained an order that barred Burke from misrepresenting material information to consumers. Criminal contempt of court has no statutory maximum penalty.
In addition to the contempt charges, Burke and Rossi are each charged with 16 counts of wire fraud, five counts of mail fraud, and one count of conspiracy. Each of these counts carries a statutory maximum penalty of 20 years in prison. The indictment also seeks forfeiture of criminal proceeds.
FTC Action against California Mailer, Florida Printer, and Florida List Broker
The FTC filed a case today in U.S. District Court for the Central District of California against Terry Somenzi, 74, of Los Angeles, who did business through a company called International Advisory Services Inc.; David Raff, 54, of Weston, Florida, and his company, Millennium Direct Inc., also doing business as MDI Lists; and Ian Gamberg, 37, also of Weston, doing business through Printmail Corporate Solutions Inc. As alleged in the FTC’s complaint, since at least 2013, the defendants participated in mailing hundreds of thousands of cash prize notifications from fictitious companies, including Paulson Independent Distributors, International Procurement Center, Keller, Sloan & Associates, and Phelps Ingram Distributors, informing mostly elderly consumers that they won a substantial cash prize of nearly $1 million or more. The notifications instruct consumers to pay a fee of approximately $25 to collect their prizes, but those who paid received nothing in return. According to the complaint, Somenzi and Raff, directly and through third-parties, provided the cash prize notifications and mailing lists of consumers’ names and addresses to Gamberg, who then arranged to have the notifications printed and mailed. Many consumers who paid the fees later received numerous other deceptive personalized cash prize notifications from the defendants and other companies who purchased lists containing the consumers’ personal information.
“In the 21st century, the scam in your mailbox just as likely comes from the other side of the world as from the other side of town,” said Director Jessica Rich of the FTC’s Bureau of Consumer Protection. “The FTC’s efforts to protect consumers don’t stop at our borders; we work with partners around the world against the perpetrators of mass mailing fraud. Regardless of where the fraud comes from, we encourage consumers to let us know if they have been scam victims; we share complaint information with our law enforcement partners in the United States and abroad. Report your complaint at www.ftc.gov, or, for international scams, at the 36-agency joint website www.econsumer.gov.”
Iowa Attorney General Actions against List Broker and Direct Mailers
The Iowa State Attorney General took action today against fraudulent mass mailers and others facilitating their schemes. It negotiated an Assurance of Voluntary Compliance (AVC) with list broker Macromark to resolve allegations that the company facilitated fraudulent activities on the part of operations that mailed deceptive solicitations relating to sweepstakes and psychics. The AVC with Macromark requires it to refrain from any further facilitation of such fraudulent activities affecting Iowa residents and to pay $30,000 into a fund that protects elderly Iowans against consumer fraud.
The Iowa Attorney General also brought an action under the Iowa Consumer Fraud Act seeking an injunction, restitution, and other relief against Waverly Direct Inc., and its owner, Gordon Shearer, a New York-based direct mailer. Shearer and his company allegedly sent out deceptive mailings from the so-called “Numerological Resource Center.” These defendants maintain lists of vulnerable people who fell prey to their schemes, according to Iowa’s lawsuit, and market these lists to other mass mailers through a list broker.
Finally, the Iowa Attorney General brought a lawsuit under the Iowa Consumer Fraud Act against Nicholas Valenti of Nevada. Valenti has allegedly been involved in marketing the rights to send out deceptive mailings regarding techniques for winning lotteries and other chance-dominated gaming activities.
* * *
The charges and allegations in the indictments and criminal complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty. The claims made in the civil complaints are allegations only, and there has been no determination of liability.
Public Education
Reflecting the government’s unified effort to combat elder financial exploitation, the Consumer Protection Branch and Elder Justice Initiative have spearheaded a multi-agency education campaign to inform the public about mass mailing fraud and how it can be avoided. Agency partners include the USPIS, the FTC, the Consumer Financial Protection Bureau, the Social Security Administration, the Securities and Exchange Commission, the Commodities Futures Trading Commission, and USA.gov. As described in detail in the fact sheet, each agency is using its means of public outreach to broadcast information about the prevalence of mass mailing fraud. The outreach includes messages to caregivers – such as friends, relatives, social workers, and others in contact with older individuals – about the need to be vigilant against prize or psychic letters being sent to those under their care.
In addition, and as described in detail in the fact sheet, the government has also joined forces with non-governmental organizations in the elder justice and consumer protection arena, each of which will contribute to the public education campaign. These groups include AARP, Consumers Union, Consumer Federation of America, the Elder Justice Coalition, Meals on Wheels Association of America, National Adult Protection Services Association, National Association of Area Agencies on Aging (n4a), National Association of States United for Aging and Disabilities, National Center for Victims of Crime, and National Consumers League. Using their vast networks and communication tools, these organizations will alert their members and the public to the scourge of mass mailing fraud schemes and offer tips to combat financial exploitation. Their tools include websites, newsletters, social media channels, training and outreach events, and other means.
U.S. law enforcement’s actions against mass mailing fraud arise out of a larger worldwide effort. Mass mailing fraud has been identified as a major financial threat by the International Mass-Marketing Fraud Working Group (IMMFWG), a network of civil and criminal law enforcement agencies from Australia, Belgium, Canada, Europol, the Netherlands, Nigeria, Norway, Spain, the United Kingdom, and the United States. The IMMFWG is co-chaired by the U.S. Department of Justice and FTC, and law enforcement in the United Kingdom. Recent actions have been taken by law enforcement agencies from several working group countries, including Belgium, Canada, the Netherlands, and the United Kingdom, to disrupt mass mailing fraud schemes and gather evidence for prosecution of criminal participants. Through these efforts, the working group serves as a model for international cooperation against specific threats that endanger the financial well-being of each country’s residents.
More information on fraud against the elderly is available at https://www.justice.gov/elderjustice/. For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at http://www.justice.gov/civil/consumer-protection-branch.
Jury in Del Rio Convicts Man in Firearms Smuggling OperationRead the Press Release
In Del Rio, a jury convicted 48–year-old ringleader Eduardo Hinojosa (aka “Lalo”), a U.S. Citizen residing in Piedras Negras, Mexico, of attempting to smuggle firearms and an assortment of ammunition from the U.S. into Mexico announced United States Attorney Richard L. Durbin, Jr., and Homeland Security Investigations (HSI) Special Agent in Charge Shane Folden.
Returning their verdict late yesterday afternoon following a three-day trial, jurors convicted Hinojosa of four counts of aiding and abetting the smuggling of goods from the U.S. and one count of providing a firearm to a prohibited person. Evidence presented at trial revealed that Hinojosa and three Mexican citizens residing in Piedras Negras were involved in a firearms smuggling scheme for profit. Prior to jury selection, Hinojosa’s co-defendants 43-year-old Carlos Mendoza-Hernandez (aka “Pepo”) and 26–year-old Gily Ajin-Cordova pleaded guilty to one count of possession of a firearm by a prohibited person; and, 25-year-old Elizabeth Cervantes-Mateos pleaded guilty to one count of aiding and abetting the smuggling of goods from the U.S.
According to testimony and court records, on April 7, 2015, investigators observed Hinojosa loading ammunition and firearms into a vehicle at an Eagle Pass business owned by Mendoza’s family. Authorities subsequently seized a .243 caliber rifle, a 12-gauge shotgun and approximately 1,000 rounds of ammunition in various calibers from inside that vehicle. At the time of the seizure, authorities arrested the vehicle’s occupants--Cervantes and Ajin. Agents later observed defendants Hinojosa and Mendez unloading boxes into a storage facility in Eagle Pass. Subsequently, authorities arrested Hinojosa and Mendez and a consensual search of that storage facility revealed approximately 750 rounds of shotgun shells. Testimony also revealed that the defendants were aware that the firearms and ammunition were ultimately destined for Mexico and that the defendants were aware that it is unlawful to export those items without a license.
All four defendants have remained in federal custody since their arrest on April 7, 2015.
Each charge upon conviction calls for up to ten years in federal prison. Sentencings before U.S. District Judge Alia Moses in Del Rio are scheduled as follows: Cervantes – 2:00pm on December 8, 2016; Mendoza – 11:00am on December 12, 2016; Ajin – 11:00am on February 1, 2017; and, Hinojosa – 2:00pm on March 20, 2017.
The case was investigated by Homeland Security Investigations with assistance from U.S. Customs and Border Protection; Bureau of Alcohol, Tobacco, Firearms and Explosives; and, the Maverick County Sheriff’s Office. Assistant U.S. Attorneys Lewis Thomas and Dan Lee are prosecuting this case on behalf of the Government.
Jury Convicts New Haven Man of Enticing a Minor for SexRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a New Haven, Mo., man has been convicted by a federal jury of attempting to entice or coerce a 14-year-old victim (actually an undercover law enforcement officer) to engage in illicit sex.
Jason M. Strubberg, 27, of New Haven, was found guilty on Wednesday, Sept. 21, 2016, of one count of attempting to entice or coerce a minor to engage in illicit sexual activity.
A detective with the Boone County, Mo., Sheriff’s Department posted an undercover online advertisement on Jan. 6, 2016, as part of an investigation to seek out potential sexual predators. Strubberg responded with several e-mails the same day. The decoy provided Strubberg with a phone number and told him she was looking for someone to help with her 14-year-old daughter’s respect issues.
Strubberg told the decoy he was a dominant person and agreed to help the decoy with her 14-year-old daughter as long as the decoy would sign a contract giving him permission to do so. Strubberg was sent two images of the decoy’s daughter, who he believed to be 14 years of age. Over the course of the next two days, Strubberg described his plans for sexual conduct, including deviate sexual intercourse with the decoy’s daughter. Strubberg said he would use ropes and other restraints if need be in order to prevent the decoy’s daughter from moving while he engaged in sexual conduct with her.
Strubberg sent a contract to the decoy by text message and asked her to print and sign the contract granting him permission to engage in sexual conduct with the decoy’s daughter.
After further e-mail correspondence, Strubberg asked the decoy and her daughter to meet in person so that he could spend the day with them engaging in sexual conduct. On Jan. 8, 2016, Strubberg arrived at the meeting place and was arrested.
Following the presentation of evidence, the jury in the U.S. District Court in Jefferson City, Mo., deliberated for just over an hour before returning the guilty verdict to U.S. District Judge Brian C. Wimes, ending a trial that began Monday, Sept. 19, 2016.
Under federal statutes, Strubberg is subject to a mandatory minimum sentence of 10 years in federal prison without parole, up to a sentence of life in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Lawrence Miller. It was investigated by the Boone County, Mo., Sheriff’s Department, the FBI and the University of Missouri Police Department.
Project Safe Childhood
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."
Jamaican Man Pleads Guilty to False Statements and Illegally Reentering the United States After Having Been Previously DeportedRead the Press Release
CONCORD, NEW HAMPSHIRE –United States Attorney Emily Gray Rice announced today that Raldo Mario Henry has pleaded guilty to making false statements in a fraudulent attempt to obtain a United States passport and to reentering the United States after having been deported previously.
Henry, who was arrested on July 7, 2016, pleaded guilty before United States District Judge Joseph DiClerico to an Information that was filed on September 22, 2016.
According to court filings and statements in Court, a Special Agent of the Diplomatic Security Service spoke with the defendant who had come, of his own volition, to the National Passport Center to check on the status of his application for a passport. The defendant was unable to provide any information about the people he claimed on the application were his parents. He also could not provide any other information about his childhood.
When told there was another person in Pennsylvania using the identity information he had used on the passport application, Henry ran away. He was apprehended after a brief foot pursuit. Further investigation revealed that Henry was a Jamaican national who previously had been deported to Jamaica.
Henry will be sentenced on January 3, 2017, and may face deportation after serving his sentence.
The case was investigated by the U.S. State Department, Diplomatic Security Service and by the U.S. Department of Homeland Security, Bureau of Immigration and Customs Enforcement. Assistant U.S. Attorney Alfred Rubega is prosecuting this case.
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Indian Head Crack Distributors Sentenced to Federal PrisonRead the Press Release
Greenbelt, Maryland – U.S. District Judge George Jarrod Hazel sentenced Paul Raymond Gray, a/k/a “PJ,” age 35, of Lusby, Maryland, today to 66 months in prison, followed by four years of supervised release, for conspiracy to distribute and possess with intent to distribute powder and crack cocaine, two counts of distribution of crack cocaine, and being a felon in possession of a firearm. On September 6, 2016, Judge Hazel sentenced Kamau Muata Lumumba, age 53, also of Indian Head to five years in prison, followed by five years of supervised release, for his participation in the crack cocaine conspiracy.
The sentences were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Daniel L. Board, Jr. of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; Special Agent in Charge Karl C. Colder of the Drug Enforcement Administration - Washington Field Division; Chief Hank Stawinski of the Prince George’s County Police Department; Chief Stanley Johnson, of the Maryland National Capital Park Police, Prince George’s County Division; Charles County Sheriff Troy Berry; St. Mary’s County Sheriff Tim Cameron; and Calvert County Sheriff Mike Evans.
According to their plea agreements and other court documents, from August 2011 through June 2015, Gray conspired with others, including Lumumba, to distribute crack cocaine. During the course of the conspiracy, Gray obtained powder cocaine from a number of sources, including through an intermediary whom Gray and Lumumba knew as “Jazz” or “Jazzy.” Gray generally purchased one or two ounce quantities of cocaine several times a month. Gray used the powder cocaine to manufacture crack in the kitchen of the mobile home the he owned, using cutting agents to increase the volume of crack for sale. Over the course of the conspiracy several co-conspirators, including Lumumba, lived in the mobile home with Gray. Gray, Lumumba and the other co-conspirators who lived at the mobile home distributed powder and crack cocaine from that location to a variety of customers. When Gray was not at the mobile home Lumumba regularly sold crack for Gray and received a portion of the profits for his assistance. On occasion Lumumba also transported money and picked up drugs for Gray related to their drug trafficking.
Gray admitted that he also possessed firearms and ammunition during the conspiracy, although he was prohibited from doing so due to several previous felony convictions in Charles County, including convictions for assault and unlawful possession of firearms.
According to Lumumba’s plea agreement, on May 22, 2015, after Gray learned that his drug trafficking was the subject of an active investigation, Gray called Lumumba and instructed him to remove incriminating evidence from the trailer and surrounding property, which Lumumba did. The evidence removed included containers in which Gray stored and cooked crack cocaine and several scales used by Gray and Lumumba to weigh their narcotics. After removing the incriminating evidence, Lumumba moved out of the trailer and fled Charles County in an effort to avoid apprehension by law enforcement. In August 2015, Lumumba learned that he and Gray had been indicted and Lumumba continued to make efforts to evade law enforcement. On April 14, 2016, the U.S. Marshals tracked down and arrested Lumumba.
United States Attorney Rod J. Rosenstein praised the ATF, DEA, Prince George’s County Police Department, Maryland National Capital Park Police, Prince George’s County Division, and the Charles, St. Mary’s and Calvert County Sheriffs’ Offices for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Michael T. Packard and Leah J. Bressack, who prosecuted this Organized Crime Drug Enforcement Task Force case.
Idaho Falls Man Pleads Guilty to Drug TraffickingRead the Press Release
POCATELLO – Michael William Martindale, 27, of Ammon, Idaho, pleaded guilty today to possessing with the intent to distribute methamphetamine and heroin, U.S. Attorney Wendy J. Olson announced. Martindale was indicted by a federal grand Jury in Pocatello on August 25, 2015.
According to the plea agreement, Martindale was stopped by Bonneville County Sheriff’s Office personnel on June 19, 2015, pursuant to outstanding warrants. Martindale was arrested for those warrants and for driving without privileges. When his vehicle was impounded, officers found a sawed off shotgun, a .38 caliber revolver, baggies of methamphetamine, a balloon containing heroin, a digital scale, oxycodone pills, and other illegal drug paraphernalia. In court, Martindale admitted to possessing the methamphetamine and heroin with the intent to distribute the substances to others. He also admitted to owning the firearms.
Martindale’s drug trafficking charge is punishable by up to 20 years in prison, a maximum fine of $1,000,000, and at least three years, up to life, of supervised release.
Sentencing is set for December 14, 2016, before Chief U.S. District Judge B. Lynn Winmill at the federal courthouse in Pocatello.
The case was investigated by the Bonneville County Sheriff’s Office and the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).
The case was prosecuted as part of Idaho’s Project Safe Neighborhoods Program, which seeks to reduce gun violence in Idaho.
Hoover Man Charged for Marketing Misbranded Male Enhancement Drugs from ChinaRead the Press Release
BIRMINGHAM – Federal prosecutors today charged a Hoover man with receiving and reselling misbranded male enhancement drugs from China that could cause serious side effects in men taking medications containing nitrates, announced U.S. Attorney Joyce White Vance and Food and Drug Administration Office of Criminal Investigation Special Agent in Charge Justin D. Green.
In a one-count information filed in U.S. District Court, the U.S. Attorney’s Office charged NABIL CHAGRI, 38, with one count of receiving and selling or offering to sell a misbranded prescription drug under the name, Zhen Gong Fu, on March 22. The product labeling did not declare that it contained sildenafil citrate, the active ingredient in the prescription drug, Viagra, and made additional false statements. Viagra is FDA approved for treatment of erectile dysfunction. The U.S. Attorney’s Office also filed a plea agreement with Chagri in which he acknowledges the charge and states he will plead guilty to it.
According to the information, drugs containing sildenafil are considered prescription drugs under federal law because of their toxicity and potential for harmful effects, and are considered unsafe for use except under the supervision of a licensed physician.
Sildenafil-containing drugs can be particularly harmful to people taking medications containing nitrates, such as nitroglycerin, because sildenafil can interact with the nitrates and lower blood pressure to dangerous levels, according to the information. Men with diabetes, high blood pressure, high cholesterol or heart disease often take nitrates.
The Zhen Gong Fu labeling not only failed to disclose that the drug contained sildenafil, it also falsely and misleadingly stated that Zhen Gong Fu “does not affect heart diseases [sic], hypertension or diabetes,” according to the information.
The government’s plea agreement with Chagri states that he received and sold, or offered for sale, a variety of mislabeled male enhancement drugs to wholesale supply stores or gas stations. The drugs, including Zhen Gong Fu, contained sildenafil or tadalafil, the active ingredient in Cialis, another FDA-approved prescription drug for erectile dysfunction.
The assorted mislabeled male enhancement drugs were mailed to Chagri from China at various addresses in north Alabama, according to the plea agreement. Between March 2015 and March 2016, the FDA detained multiple packages containing the drugs in route from China to Chagri and issued eight import detention notices to him, inviting Chagri to challenge the agency’s decision to detain the packages, the plea agreement states.
Chagri received the FDA detention notices, but continued to order and receive the drugs from China, sometimes under fictitious names “in an effort to mislead and evade detection by law enforcement,” according to the plea agreement.
The maximum punishment for receiving and selling, or offering for sale, a misbranded prescription drug is three years in prison and a $250,000 fine.
The FDA investigated the case, which Assistant U.S. Attorney Chinelo Dike-Minor is prosecuting
Honduran National Pleads Guilty to being an Illegal Alien in Possession of a FirearmRead the Press Release
U.S. Attorney Kenneth A. Polite announced that JORGE EDUARDO VALLEJO, age 37, a citizen of Honduras, pled guilty today to a one-count Indictment charging him with violations of the Federal Gun Control Act.
According to the Indictment, on or about July 12, 2014, VALLEJO, an alien illegally in the United States, was found in possession of a SCCY, Model CPX-2, 9mm semi-automatic pistol.
VALLEJO faces a maximum term of imprisonment of ten years, a fine of $250,000, three years supervised release after imprisonment, and a $100 special assessment. U.S. District Judge Nannette Jolivette Brown set sentencing for January 12, 2017.
U.S. Attorney Polite praised the work of the Homeland Security Investigations of the U.S. Department of Homeland Security in investigating this matter. Assistant United States Attorney Spiro G. Latsis is in charge of the prosecution.
Heroin Traffickers SentencedRead the Press Release
AMARILLO, Texas — A couple arrested earlier this year after a traffic stop in Carson County, Texas, and then found to have 3,825 grams of heroin in bundles in a suitcase in the cargo section of their vehicle, have been sentenced, announced U.S. Attorney John Parker of the Northern District of Texas.
On Tuesday, September 20, 2016, Carlos Castro-Noriega, 34, was sentenced by U.S. District Judge Sidney A. Fitzwater to 63 months in federal prison. Last month, Judge Fitzwater sentenced Cristina Melissa Gomez, 24, to 46 months in federal prison. Each pleaded guilty to one count of possession with intent to distribute one kilogram or more of heroin and aiding and abetting.
According to documents filed in the case, on February 9, 2016, a Trooper with the Texas Department of Public Safety stopped a 2015 white Jeep Grand Cherokee rental vehicle, with a California registration, for speeding and driving in the left lane when not passing. Gomez was the driver and Castro-Noriega was in the front passenger seat. While speaking with Gomez, the Trooper observed several indicators of criminal activity and could smell burnt marijuana coming from the front of the vehicle.
While conducting a probable cause search of the vehicle, the Trooper located eight bundles of a brownish-white powdery substance inside of a suitcase located in the Jeep’s rear cargo area. Subsequent testing confirmed the substance as 3,825 grams of heroin. The Trooper also located 18.2 grams of marijuana in the vehicle.
The case was investigated by the Drug Enforcement Administration, the Texas Department of Public Safety and U.S. Immigration and Customs Enforcement Homeland Security Investigations. Assistant U.S. Attorney Sean Taylor prosecuted.
Hart County, Kentucky, Man Charged with Consumer Product TamperingRead the Press Release
Charged with putting glass shards in cups being sent to fast food restaurants
BOWLING GREEN, Ky. – A Hart County, Kentucky, man was charged, under seal, by grand jury indictment on September 14, 2016, with one count of consumer product tampering, announced United States Attorney, John E. Kuhn, Jr.
Waylon J. Horton, 41, of Munfordville, Kentucky, is charged with tampering with a consumer product that affected interstate commerce, while recklessly disregarding the risk that another person would be placed in danger of death or bodily injury, and under circumstances manifesting extreme indifference to such risk. Specifically, on or about July 11, 2016, through July 13, 2016, Horton allegedly placed shards of glass in cups that would be sent to fast food restaurants.
The indictment was unsealed on September 20, 2016, when Horton was arrested in Hart County and appeared before Untied States Magistrate Judge H. Brent Brennenstuhl in Bowling Green.
If convicted of the charge, Horton could be sentenced to no more than ten years in prison, fined $250,000 and serve three years of supervised release.
Horton was initially charged in Kentucky Circuit Court on July 27, 2016 with wanton endangerment and possession of a destructive device.
Horton, was released on a $25,000 unsecured bond, and is scheduled for arraignment before Judge Brennenstuhl on September 28, 2016 at 10:00am CT in Bowling Green.
This case is being prosecuted by Assistant United States Attorney Amanda Gregory and is being investigated by the Federal Bureau of Investigation (FBI), with assistance from the Hart County (Kentucky) Sheriff’s Department.
The charge of a person by Grand Jury Indictment, is an accusation only and that person is presumed innocent until and unless proven guilty.
Greenwood man charged in fraud schemeRead the Press Release
Alleged to have embezzled nearly $2.7 million from local construction company
Indianapolis - United States Attorney Josh J. Minkler, announced charges today against a former project manager for an Indianapolis construction management company. Troy L. Sissom, 52, Greenwood, Indiana, was charged with mail fraud and making a false tax return.
“Internal theft costs all consumers through higher prices on goods and services,” said Minkler. “Fraud, tax evasion, and other white collar crimes, are offenses which ultimately take money out of the pockets of hard working Hoosiers and such crimes will be aggressively prosecuted by this office.”
Sissom was employed by the F.A. Wilhelm Construction Company (WCC) as a project manager. His responsibilities there included creating estimates for jobs, overseeing the financial aspects of construction projects, and approving material purchases for his projects.
In 2003, Sissom created a corporation named LTEE Source and rented a commercial UPS mailbox under that name. Between 2003 and 2015, Sissom created false invoices in the name of LTEE and submitted them to the accounting department at WCC for payment. These invoices were for materials purported to have been for construction projects supervised by Sissom. WCC would then mail the checks for payment of the fraudulent invoices to Sissom’s UPS mailbox. Sissom would then deposit the checks into an account he opened under the LTEE name and used the money for his own purposes.
The estimated loss to WCC was over $2.7 million. Tax loss to the IRS was over $381,000. Sissom has agreed to plead guilty to both charges.
This case was investigated by the Internal Revenue Service-Criminal Investigation and the United States Postal Inspection Service.
"Tax evasion is not a victimless crime, said Special Agent in Charge of IRS-Criminal Investigation, James D. Robnett. “When people cheat on their taxes, honest taxpayers suffer the consequences and have to make up the difference. We should not expect the honest American taxpayer to foot the bill for Mr. Sissom and others who hide income from the IRS.”
“Protecting the public is a core function of the U.S. Postal Inspection Service," said Patricia Armstrong, Acting Inspector in Charge of the U.S. Postal Inspection Service's Detroit Division. "This case shows our diligence in pursuing criminal schemes and ruining a fraudster's ability to continue them."
According to Assistant United States Attorney James M. Warden who is prosecuting the case for the government, Sissom faces up to 20 years’ imprisonment if convicted and will make full restitution to Wilhelm Construction and pay the entire tax liability to the government.
An information is merely a charge and not evidence of guilt. All defendants are presumed innocent until proven otherwise in federal court.
Grand Prairie, Texas Man Pleads Guilty to Bank Fraud, False IdentificationRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that ISSAC YEBOAH, age 30, of Grand Prairie, Texas, pled guilty to BANK FRAUD, in violation of Title 18, United States Code, Sections 1344(2) and 2 and UNLAWFUL TRANSFER, POSSESSION OR USE OF A MEANS OF IDENTIFICATION, in violation of Title 18, United States Code, Sections 1028(a)(7) and 2.
The Indictment alleged that on or about March 18, 2016, in the Eastern District of Oklahoma, the defendant did knowingly obtain moneys and funds owned by and under the custody and control of CreditONE, a financial institution as defined by Title 18, United States Code, Section 20, whose deposits were insured by the Federal Deposit Insurance Corporation, by means of false pretenses and representations, by using an unauthorized credit card. It further alleges that on the same date the defendant did knowingly possess in or affecting interstate or foreign commerce, without lawful authority, a means of identification of another person, knowing that the means of identification belonged to another actual person, with the intent to commit, or to aid or abet or in connection with, Bank Fraud.
The charges arose from an investigation by the Murray County Sheriff’s Office, the Oklahoma Highway Patrol and the United States Secret Service.
The Honorable Kimberly E. West, Magistrate Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, accepted the plea and ordered the completion of a presentence investigation report. Sentencing will be scheduled upon its completion. The defendant will remain in the custody of the United States Marshal Service, pending sentencing.
The statutory range of punishment for Bank Fraud is not more than 30 years imprisonment, a fine of up to $1,000,000.00 or both and for Unlawful Transfer, Possession or Use of a Means of Identification is not more than 5 years imprisonment, a fine of up to $250,000.00 or both on count 2.
Assistant United States Attorney Melody Nelson represented the United States.
Georgetown Man Convicted of Failing to Update Sex Offender RegistrationRead the Press Release
Contact: Craig M. Wolff
Assistant United States Attorney
Tel: (207) 945-0373Portland, Maine: United States Attorney Thomas E. Delahanty II announced that Michael Nagell, 51, of Georgetown, Maine, was convicted today following a jury trial in U.S. District Court of failing to update his sex offender registration.
Court records and trial evidence revealed that in 2007, Nagell was convicted in federal court in Massachusetts of attempting to entice a minor to engage in sexual activity and traveling with intent to engage in illicit sexual conduct. As a result, he was a sex offender for purposes of the federal Sex Offender Registration and Notification Act, and was required to register with the Maine sex offender registry. In December 2015, Nagell became a full-time employee of a company in Portland, and remained employed with the company until April 2016. Nagell knowingly failed to update his sex offender registration to reflect this change in his employment.
Nagell faces up to 10 years in prison, a fine of up to $250,000, and supervised release of at least 5 years and up to life. He will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
The investigation was conducted by the U.S. Marshals Service.
Fort Smith Man Sentenced to 12 1/2 Years in Federal Prison for Sex Trafficking of a MinorRead the Press Release
Fayetteville - Kenneth Elser, United States Attorney for the Western District of Arkansas, announced that Randall Tyrell Steward, aka Randall Stewart, aka “Trouble”, age 31 of Fort Smith, was sentenced today to 151 months in federal prison and five (5) years of supervised release on one count of Sex Trafficking of a Minor. The sentencing took place before the Honorable Judge Timothy L. Brooks in the United States District Court in Fayetteville.
According to court records, on August 27, 2015, a 17-year-old female was interviewed by the Federal Bureau of Investigation (FBI). She reported that she had run away from home and came in contact with Steward in early June of 2015. She stated she worked as a prostitute for Steward out of a Fayetteville, Arkansas hotel and that Steward used backpage.com to advertise her as a prostitute. Agents were able to obtain records from the Fayetteville hotel and backpage.com to corroborate the information that the minor female victim had provided. Steward was indicted by a federal grand jury in October, 2015 and pleaded guilty to the charge in December, 2015.
“The sentence today for Steward is the result of effective collaboration among law enforcement and our enduring resolve to protect juveniles from being exploited for the purpose of prostitution,” stated Special Agent in Charge Diane Upchurch with the Federal Bureau of Investigation in Little Rock. “We appreciate the strong commitment of the United States Attorney’s Office and our federal, state and local partners who continue to work to identify these predators and their victims.”
This case was investigated by the Federal Bureau of Investigation (FBI) and the Fort Smith Police Department. Assistant United States Attorney Aaron Jennen prosecuted the case for the United States.
The 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 Postal Employee Charged with Unemployment Compensation FraudRead the Press Release
HARRISBURG- The United States Attorney’s Office for the Middle District of Pennsylvania announced today that on September 21, a federal grand jury in Harrisburg has returned an indictment charging Rashaad Schell, age 26, Abington, PA, with unemployment compensation fraud.
According to United States Attorney Peter Smith, Schell was working for the United States Postal Service while also obtaining unemployment compensation from the Pennsylvania Department of Labor and Industry in Harrisburg. The amount of the loss to the unemployment compensation program is $18,000.
This matter was investigated by the Pennsylvania Department of Labor and Industry and the United States Postal Service, Office of Inspector General. Prosecution has been assigned to Chelsea Schinnour.
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 is five years, 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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Former Mayor of Clinchco Sentenced to Prison on Federal Fraud ChargesRead the Press Release
ABINGDON, VIRGINIA – The former mayor of Clinchco, Virginia in Dickenson County, was sentenced today in Federal Court to fraud charges stemming from her use of town funds used to make improvements and repairs to her personal home while she was Mayor, United States Attorney John P. Fishwick Jr. announced.
Peggy Sue Stanley Mickens, 50, of Clinchco, Virginia, previously pled guilty today to one count of theft concerning programs receiving Federal funds, one count of mail fraud and one count of wire fraud. Today in District Court, Mickens was sentenced to imprisonment for a term of six months and was ordered to make restitution to the Town of Clinchco in the amount of $6,179.47.
“Peggy Mickens abused her position of trust to enrich herself and for that she has been held accountable,” United States Attorney Fishwick said today. “The United States Attorney’s Office takes reports of public corruption seriously and will continue to pursue federal charges against public officials, when appropriate.”
According to evidence presented at previous hearings by Russell County Commonwealth’s Attorney and Special Assistant United States Attorney Brian Patton, Mickens was elected Mayor of Clinchco in May 2012, at which time she gained access to, and possession of the town’s banking instrument, credit cards, invoices and banking statements.
In 2013, Clinchco received approximately $20,000 from the Department of Housing and Urban Development [HUD] via a Community Development Block Grant, to be used to rehabilitate homes and/or construct new homes in the town. Mickens, without any type of procurement formalities or approval, hired a contractor to remodel her home and paid for it from the town’s BB&T bank account via checks signed by her. The defendant took these actions without the knowledge or consent of town officials.
Mickens also fraudulently used a Lowe’s credit card maintained by the Town of Clinchco, without the knowledge or consent of town officials, to charge $662 from the Lowe’s store in Wise, Virginia to obtain materials for her personal home.
The investigation of the case was conducted by Federal Bureau of Investigation and the Virginia State Police. Russell County Commonwealth’s Attorney and Special Assistant United States Attorney Brian Patton prosecuted the case for the United States.
Former Frisch’s Employee Sentenced in SchemeRead the Press Release
CINCINNATI – Michael Hudson, 53, of Cincinnati, Ohio was sentenced in U.S. District Court today on one count of wire fraud and one count of filing a false federal income tax return with the Internal Revenue Service (IRS) relative to a scheme to defraud Frisch’s Restaurants, Inc. (“Frisch’s”) by embezzling funds in excess of his authorized pay and compensation.
Hudson was sentenced to 60 months in prison, three years of supervised release, and was ordered to pay restitution to Frisch’s in the amount of $3,099,305.49, to Travelers Insurance in the amount of $505,000 and to the IRS in the amount of $969,697.81.
Benjamin C. Glassman, Acting United States Attorney for the Southern District of Ohio, Kathy A. Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation, Cincinnati Field Office, and Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division, announced the sentence handed down by U.S. District Judge Michael R. Barrett.
According to court documents, between 1992 and 2014 Hudson was employed at Frisch’s and between 2004 and December 2014 Hudson was the assistant treasurer for Frisch’s. While serving as assistant treasurer, Hudson made unauthorized wire or ACH transfers of funds from the Frisch’s bank accounts for his own benefit. For example, on one occasion, Hudson transferred money from Frisch’s bank account to a bank account in the name of WPMH Properties, LLC, which was a business owned and controlled by Hudson.
In total, between 2008 and 2014 Hudson embezzled $3,905,930.11 from Frisch’s as a result of this fraud scheme.
In addition, Hudson filed a false 2009 income tax return with the IRS. Specifically, Hudson embezzled $323,936.19 from Frisch’s in 2009, but failed to report it as income on his 2009 income tax return.
Also, for the 2010 through 2013 income tax years, Hudson failed to file an income tax return with the IRS in an effort to evade the payment of income taxes related to the embezzlement scheme.
The total amount of income taxes due and owing for the 2009 through 2013 income tax years was $969,697.81.
"The role of IRS Criminal Investigation becomes even more important in embezzlement and fraud cases due to the complex financial transactions that can take time to unravel," said Kathy A. Enstrom, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office. "The federal tax laws are normally violated in these cases which can add to additional jail time. As we often see, the victims are not only the taxpayers, but also the individuals and entities who suffer the financial harm."
Acting U.S. Attorney Glassman commended the investigation by IRS-Criminal Investigation and the FBI, as well as Assistant United States Attorney Timothy S. Mangan, who prosecuted the case.
Florida Man Sentenced in Pill Mill CaseRead the Press Release
BRUNSWICK, GA – Marc Victor Frazier, 45, from Satellite, Florida, was sentenced in United States District Court on September 19, 2016, to 44 months in prison. Frazier’s prison term will be followed by a 3-year term of supervised release. Appearing before Chief Judge Lisa Godbey Wood, Frazier was sentenced for his role in a conspiracy to unlawfully dispense controlled substances and launder money. Frazier was also ordered to forfeit more than $500,000 in assets, all of which were proceeds of his unlawful activity.
The evidence showed that Frazier was the owner and organizer of Apex Health & Wellness, Inc., a supposed “pain management clinic,” from a building located at 6129 New Jesup Highway, Brunswick, Georgia. Between November 2011 and April 24, 2013, drug-seeking customers typically paid between $200 and $300 cash to Apex Health & Wellness, in exchange for prescriptions for controlled substances issued outside the usual course of professional practice and without legitimate medical purpose. The clinic employed Paul Spencer Ruble, a licensed and registered medical doctor, to work at the clinic. (Ruble pleaded guilty to a similar charge on August 22, 2016 and is pending sentencing.) An average of 30 drug seeking patients were seen per day at the clinic during its 17 months of operation. A typical patient could expect to receive a prescription for 168 oxycodone 30 mg tablets, 112 oxycodone 15 mg tablets, and 28 to 56 2 mg alprazolam tablets. During the conspiracy, more than 400 deposits were made to the bank account of Apex Health & Wellness. These deposits totaled more than $1.8 million, including cash deposits of over $1.7 million. Apex Health & Wellness was permanently closed on April 24, 2013, when a federal search warrant was executed at the premises.
The convictions in this matter resulted from a joint investigation by the DEA, GBI, Glynn-Brunswick Narcotics Enforcement Team (GBNET), IRS - Criminal Investigations, and the United States Marshals Service. The investigation was conducted under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF) program, the keystone drug enforcement program of the Department of Justice.
United States Attorney Edward Tarver said, “This defendant profited handsomely from exploiting drug addicted individuals who came to his sham pain clinic. We have demonstrated time and again that persons who operate pill mills in the Southern District of Georgia can expect to be investigated, prosecuted, and stripped of their assets, the same as other drug traffickers in the Southern District of Georgia. The menace posed by these clinics cannot be understated. As I have previously noted, the heroin epidemic which is sweeping many parts of the country can be directly traced to the drug prescribing practices of these phony medical clinics where the owners and doctors prosper and the patents suffer grievously.”
Assistant United States Attorneys Karl Knoche, Greg Gilluly, and Marcela Mateo prosecuted the case for the government. For additional information, please contact First Assistant United States Attorney James D. Durham at (912) 201-2547.
Five Defendants Face Federal Charges in Pain Management Clinic Kickback SchemeRead the Press Release
Baltimore, Maryland – A federal grand jury indicted five defendants on charges arising from a scheme whereby physicians and administrative personnel associated with a Maryland pain management practice agreed to refer urine specimens to a testing lab for evaluation in return for $1.37 million in kickbacks:
Sandeep Sherlekar, age 51, of Germantown, Maryland,
Atif Babar Malik, age 46, of Germantown,
Muhammad Ahmad Khan, age 43, of Pakistan,
Mubtagha Shah Syed, age 49, of Jersey City, New Jersey, and
Konstantin Bas, age 40, of Brooklyn, New York.The indictment also charges Sherlekar, Malik and Khan with conspiring to defraud the IRS, and Sherlekar and Malik are further charged with health care fraud and making false statements on patient medical records. The indictment was returned on June 28, 2016 and unsealed today.
The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation, Baltimore Field Office; and Special Agent in Charge Nicholas DiGiulio, Office of Investigations, Office of Inspector General of the Department of Health and Human Services; Special Agent in Charge Thomas Jankowski of the Internal Revenue Service - Criminal Investigation, Washington, D.C. Field Office; Special Agent in Charge Robert Craig of the Defense Criminal Investigative Service - Mid-Atlantic Field Office; and Special Agent in Charge Scott Rezendes of the Office of Personnel Management – Office of Inspector General.
Sherlekar and Malik were physicians trained in pain management and Sherlekar was also trained in anesthesiology. The two merged their Maryland pain management practices in February 2009 to create Advanced Pain Management Services, LLC (APMS), first in Frederick, Maryland, and expanding to multiple offices in Maryland. Starting in August 2010, APMS began doing business under the name of American Spine Center, LLC (APMS/ASC) and the APMS entity was thereafter used in submitting bills for medical services. Khan was the CEO of APMS/ASC and co-conspirator Vic Wadwha was its CFO.
Bas was the owner and CEO of a medical testing laboratory principally located in Linden, New Jersey. Syed was a marketing agent who solicited medical practices to submit blood and urine specimens to the medical laboratory for testing. Bas also owned a company which provided pharmaceuticals and medications; and a third company which provided medical and surgical supplies, including orthotic devices.
Kickback Scheme
APMS/ASC required patients who were prescribed pain relief medications to submit urine samples for testing in order to monitor the levels of pain medication or other narcotics in their bodies. From spring 2011 to August 2012, APMS/ASC typically generated approximately 700 to 1,000 urine samples each month which were sent to an outside lab for testing.
According to the 36 count indictment, starting in February 2011, Bas agreed to pay kickbacks to the principals of APMS/ASC in return for the referral of APMS/ASC patients to his companies for the testing of urine samples, for back braces, and for pain creams. Syed is charged with facilitating the referrals-for-kickbacks arrangement, and receiving 5% of the proceeds of the agreement.
From the time the kickback payments commenced in June 2011 until the end of the scheme in August 2012, Bas caused his companies to pay kickbacks totaling approximately $1.37 million to Sherlekar, Malik, Khan and Wadhwa. Out of the total amount of the kickback payments, the indictment charges that Sherlekar and Malik received approximately $244,000 each, Khan received approximately $400,000, and the balance of the kickback payments were retained by Wadhwa.
All five defendants face a maximum sentence of five years in prison for conspiring to violate the Anti-Kickback Act. Sherlekar and Malik also face five years in prison on each of 12 counts of soliciting and receipt of unlawful remuneration in violation of the Anti-Kickback Act.
Defrauding the IRS
The indictment charges that from January 2009 to the end of 2013 Sherlekar, Malik and Khan conspired to defraud the IRS by not reporting as income cash payments received by APMS/ASC, and by filing false corporate tax returns that overstated the practice’s expenses and understated its revenues.
Specifically, the indictment charges that Sherlekar, Malik, Khan and Wadhwa caused cash payments received from patients to be collected without being recorded in the APMS/ASC accounting records, and provided fraudulent accounting records to an accountant to use in preparing inaccurate tax returns for APMS and its related entities. The indictment further charges that Sherlekar and Malik caused Wadhwa: to collect and distribute unrecorded cash payments; and to purchase luxury items such as expensive jewelry on their behalf, including an engagement ring and a watch purchased for Malik’s benefit in October 2010, with over $10,000 in cash skimmed from the business receipts of APMS. Sherlekar, Malik, Khan and Wadhwa also caused their accountant to falsely inflate corporate expenses, to shift revenue between different APMS-related entities, and to file false individual income tax returns on behalf of both Sherlekar and Malik.
Sherlekar, Malik and Khan face a maximum sentence of five years in prison for conspiring to defraud the IRS.
Health Care Fraud
APMS/ASC provided diagnostic or therapeutic nerve blocks and injections and other surgical procedures related to spinal conditions, which may be provided in conjunction with anesthesia services. If two providers are present during a surgical procedure, and one performs the surgical procedure and the other administers the anesthesia, then the anesthesiologist may separately bill for the anesthesia service. However, if a surgeon or anesthesiologist is alone in the procedure room and administers the anesthesia service while also performing the surgical procedure, then the anesthesia service may not be billed separately, but instead is included within the fee for the surgical procedure.
The indictment charges that from January 2010 to the summer of 2012, only one physician at APMS/ASC performed both the spinal injection and administered the anesthesia. On certain specified occasions, Sherlekar caused separate bills to be submitted for the surgical and anesthesia procedures as if both a surgeon and an anesthesiologist had been present. For example, on one occasion in January 2012, with Malik’s consent, Sherlekar caused patients’ medical records to reflect that Malik had also been present for the procedure when, in fact, he was in New Jersey at the time.
Sherlekar and Malik face a maximum sentence of 10 years in prison for health care fraud. Malik faces a maximum sentence of five years in prison for making false statements relating to health care matters.
No court appearance has been scheduled for the defendants.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
Vic Wadhwa, age 39, of Frederick, Maryland, previously pleaded guilty to his participation in the kickback scheme and awaits sentencing.
United States Attorney Rod J. Rosenstein commended the FBI, Department of Health and Human Services – OIG, IRS - Criminal Investigation, Defense Criminal Investigative Service and Office of Personnel Management – OIG for their work in the investigation. Mr. Rosenstein also thanked Assistant U.S. Attorneys Jefferson M. Gray and Sean Delaney, who are prosecuting the cases.
Five Charged in Multi-Count Federal Drug IndictmentRead the Press Release
Jackson, Miss – Five defendants have been named in a multi-count federal indictment charging conspiracy and possession with intent to distribute cocaine hydrochloride, commonly known as cocaine "powder" and cocaine base, commonly known as "crack", announced U.S. Attorney Gregory K. Davis and Assistant Special Agent in Charge Daniel Comeaux of the DEA Jackson District Office. The indictment is the result of a two-year investigation by the federal Organized Crime and Drug Enforcement Task Force (OCDETF) in this district.
Charlie Lee Martin, 53, of Jackson, is charged with one count of conspiracy to possess with intent to distribute 280 grams or more of cocaine base and to possess with intent to distribute cocaine hydrochloride. Martin is also charged with one count of possession with intent to distribute 280 grams or more of cocaine base and one count of possession with intent to distribute cocaine hydrochloride.
Derek D. Moseley, 48, of Houston, Texas, is charged with one count of conspiracy to possess with intent to distribute 280 grams or more of cocaine base and to possess with intent to distribute cocaine hydrochloride. Moseley is also charged with one count of possession with intent to distribute 280 grams or more of cocaine base and one count of possession with intent to distribute cocaine hydrochloride.
L.C. Hatfield, Jr., 42 of Jackson, is charged with one count of conspiracy to possess with intent to distribute 280 grams or more of cocaine base and to possess with intent to distribute cocaine hydrochloride. Hatfield is also charged with two counts of possession with intent to distribute cocaine base and two counts of possession with the intent to distribute cocaine hydrochloride.
Richard Williams, 44, of Forest, is charged with one count of conspiracy to possess with intent to distribute cocaine base. Williams is also charged with one count of possession with intent to distribute cocaine base.
Deontha White, 28 of West Point, is charged with one count of conspiracy to possess with intent to distribute 500 grams or more of cocaine hydrochloride, and one count of possession with intent to distribute 500 grams or more of cocaine hydrochloride.
The case is scheduled for trial before Senior U.S. District Judge William H. Barbour on November 8, 2016. If convicted on all offenses:
• Charlie Lee Martin faces a maximum sentence of life in prison and $21M fine;
• L.C. Hatfield, Jr., faces a maximum sentence of life in prison and $27M fine;
• Derek D. Mosely faces a maximum sentence of life in prison and $21M fine;
• Richard Williams faces a maximum sentence of 40 years in prison and $1M fine; and
• Deonta White faces a maximum sentence of 80 years in prison and $10M fine.
The case was investigated by the Drug Enforcement Administration, the Mississippi Bureau of Narcotics, and the Bureau of Alcohol Tobacco Firearms and Explosives, and were assisted by, Hinds County Sheriff’s Office, Ridgeland Police Department, Jackson Police Department, U.S. Marshals Service, Federal Bureau of Investigation, Mississippi Highway Patrol, Madison County Sheriff’s Office, Brandon Police Department, Rankin County Sheriff’s Office, Mississippi Department of Corrections, Pearl Police Department, Flowood Police Department, Customs and Border Patrol, and the DEA Houston Field Division. It is being prosecuted by Assistant United States Attorney Jerry L. Rushing.
The public is reminded that an indictment is merely a charge and should not be considered as evidence of guilt. The defendant is presumed innocent until proven guilty in a court of law.
Federal Officials Close Review into Death of Linwood Lambert Jr.Read the Press Release
ROANOKE, VIRGINIA – U.S. Attorney John P. Fishwick Jr. announced today that there is insufficient evidence to pursue federal criminal civil rights charges against South Boston Police Officers Tiffany Bratton, Travis Clay and Clinton Mann for the death of Linwood Raymond Lambert Jr. on May 4, 2013.
Officials from the U.S. Attorney’s Office of the Western District of Virginia, the Justice Department’s Civil Rights Division and the FBI notified members of Lambert’s family today to inform them of this decision.
Federal authorities conducted an independent review of all the information obtained during the states’ investigation into Lambert’s death. This information included the rearview and outward facing dashboard cameras from the officers’ patrol cars, surveillance camera footage from the hospital, witness interview reports, evidence pertaining to the use of tasers, the depositions and expert witness materials in the civil litigation and the medical examiner’s report and amended report.
The team of experienced federal prosecutors and FBI agents considered whether officers Bratton, Clay and Mann violated federal law by willfully using unreasonable force against Lambert. Under the applicable federal criminal civil rights statute, prosecutors would be required to establish, beyond a reasonable doubt, that a law enforcement officer, or in this case officers, willfully deprived an individual of a constitutional right. To establish willfulness, federal authorities would be required to show that the officers acted with the deliberate and specific intent to do something the law forbids. This is the highest standard of intent imposed by law. Mistake, misperception, negligence or poor judgment are not sufficient to establish a federal criminal civil rights violation. In this case, all the information obtained during the state’s investigation was reviewed by federal authorities.
Evidence showed that on May 4, 2013, officers Bratton, Clay and Mann responded to a call of a disturbance at a South Boston motel and encountered Lambert. His behavior included incoherent speech and apparent hallucinations. The officers decided not to arrest Lambert but, instead, to transport him to the hospital. Upon arrival at the hospital’s emergency room entrance, Lambert raised his feet and kicked out the glass of the rear passenger door of the police car that he was traveling in and ran from the vehicle, with his hands cuffed behind his back. Lambert violently collided, shoulder first, with the ER entrance door. Officers followed him and immediately tased him. The officers tased im several more times and physically struggled with Lambert as he resisted their efforts to apply leg restraints and failed to comply with their commands. The officers then raised Lambert to his feet and escorted him to a patrol car. While in the backseat, Lambert mumbled incoherently, rocked his body in all directions, remained conscious with his eyes open, and banged his head against the interior of the car. After he slouched in the backseat and raised his legs, and failed to respond to the officers’ commands to stop doing so, the officers, fearing he would again kick out the windows of the patrol car, used their tasers in an attempt to compel compliance. When that failed, the officers pushed Lambert in a seated position and fastened the seat belt. When they arrived at the jail sally port, Officer Clay discovered that Lambert was unresponsive in the backseat. Although the officers initiated CPR, Lambert was pronounced dead shortly thereafter.
In this case, there is no reliable evidence to contradict the assertion that the officers tased Lambert at the hospital door for a legitimate law enforcement purpose, namely to gain control of an individual they perceived as non-compliant and behaving erratically. Similarly, there is no reliable evidence to contradict the assertion that the officers tased Lambert in the patrol car in order to prevent him from causing further damage to the vehicle and to gain his compliance to transport him to jail.
Based on a careful and thorough review, the team of federal prosecutors and FBI agents determined that there was insufficient evidence to prove, beyond a reasonable doubt, that officers Bratton, Clay and Mann acted willfully with a bad purpose to violate federal law. Accordingly, the federal review of this incident has been closed without prosecution. This decision is limited strictly to an application of the high legal standard required to prosecute the case under the federal civil rights statute; it does not reflect an assessment of any other aspect of the incident that led to Lambert’s death.
The U.S. Attorney’s Office, the Civil Rights Division and the FBI are committed to investigating allegations of civil rights violations by law enforcement officers and will continue to devote the resources required to ensure that all allegations of serious civil rights violations are fully and completely investigated. The department will aggressively prosecute criminal civil rights violations whenever there is sufficient evidence to do so.
Federal Jury Convicts El Paso Attorney Marco Delgado in Connection with a Multi-Million Dollar Fraud / Money Laundering SchemeRead the Press Release
In El Paso, a federal jury has convicted 50-year-old El Paso attorney Marco Antonio Delgado (aka Marco Delgado Licon) in connection with a multi-million dollar wire fraud and money laundering scheme announced United States Attorney Richard L. Durbin, Jr. and Homeland Security Investigations Special Agent in Charge Waldemar Rodriguez.
Yesterday afternoon, jurors found Delgado guilty of three counts of wire fraud, seven counts of money laundering and nine counts of engaging in monetary transactions of criminally derived property. According to court documents and trial testimony, in January 2010, Delgado, as a legal representative of FGG Enterprises, Inc. (FGG) signed a $121 million contract between FGG and the Comision Federal de Electricidad (CFE), a Mexican-state-owned utility company, for the acquisition and installation of power turbines for the Agua Prieta II power plant located in Agua Prieta, Sonora, Mexico. Pursuant to the agreement, payments from CFE to FGG were to be deposited into a FGG bank account located in El Paso.
Evidence during trial also revealed that Delgado, for the purpose of personal enrichment and without the consent of the sole owner of FGG, submitted a fraudulent written request to CFE, causing the payments that were supposed to be made to FGG to instead be deposited in an account in the Turks and Caicos Island, where Delgado controlled the funds. As a result, the first two payments from CFE—one on March 8, 2010, in the amount of $20 million and one on July 6, 2010, in the amount of $12 million—were deposited into the bank account in the Turks and Caicos Islands, instead of FGG’s account. Delgado subsequently diverted millions from the account in the Turks and Caicos Islands. He used the monies for, among other things, the purchase of a residence in El Paso and a condominium in Taos, NM.
Delgado faces up 20 years in federal prison for each of the wire fraud and money laundering counts. He faces up to ten years in federal prison on each of the remaining counts. Delgado also faces criminal forfeiture by the Government of proceeds traceable to his illegal scheme, including the defendant’s residence and furnishings in El Paso and condominium in Taos, NM. He has remained in federal custody since his arrest in November 2012. No sentencing date has been scheduled.
This investigation was conducted by Homeland Security Investigations (HSI). Assistant United States Attorneys Debra Kanof, Anna Arreola and Jose Luis Gonzalez are prosecuting this case on behalf of the Government.
Federal Grand Jury Charges Owner of Several North Texas Pill Mills with Drug Conspiracy and Firearm ChargesRead the Press Release
DALLAS — During a week that the Department of Justice has designated as National Heroin and Opioid Awareness Week, in which it seeks to prevent new victims from succumbing to addiction and highlight its ongoing commitment to hold traffickers accountable, a federal grand jury in Dallas returned a superseding indictment charging John Christopher Ware, a/k/a “Little Chris,” with drug distribution conspiracy and firearm charges stemming from his operation of several “pill mills” in north Texas, announced U.S. Attorney John Parker of the Northern District of Texas.
Ware, 44, formerly of Dallas but now residing in Houston, and coconspirator Stanley James, Jr., 57, of Dallas and Houston, were each originally indicted in November 2015 on one count of conspiracy to distribute a controlled substance (hydrocodone). James, who is in custody, pleaded guilty in May 2016 to that indictment and is scheduled to be sentenced on December 15, 2016. This week’s superseding indictment adds the offense of using, carrying, and brandishing a firearm during and in relation to, and possessing and brandishing a firearm in furtherance of a drug trafficking crime as to Ware. Trial is set for November 28, 2016, before U.S. District Judge Jane J. Boyle.
According to the superseding indictment, Ware owned a series of clinics in north Texas and elsewhere that operated as “pill mills,” unlawfully distributing hydrocodone and other controlled substances. For instance, Ware and James owned and operated Great Southwest Medical Clinic on Great Southwest Parkway in Dallas; Arlington Oaks Adult Medical Clinic on Billings Street in Arlington, Texas; and Redbird Family Medical Clinic on Camp Wisdom Road in Dallas. Ware and James owned and operated these three medical clinics under an umbrella company, J.C. Rapha Medical Management Group, LLC.
Sometime in mid-2014, Ware and James separated at least a part of their business interests, including interests in the Arlington Oaks and Redbird clinics. In late July 2014, Ware and another individual formed AC Medical Management Group, LLC, to operate medical clinics. Ware continued managing Arlington Oaks, but changed the clinic’s name to AC Medical Clinic and relocated it in November 2014 to East Arkansas Lane in Arlington, where he continued to own and operate it until it closed in May 2015. From approximately March 2015 to October 8, 2015, Ware and others also owned and operated KSW Medical Management on Bolton Boone Drive in Desoto, Texas.
Hydrocodone is the generic name for a narcotic analgesic that is also sold under a variety of brand names such as Vicodin, Norco, and Lortab. It is also referred to by the street names “hydros,” “vics,” “norcos,” and “tabs.” When legally supplied by a licensed practitioner for a legitimate medical purpose in the usual course of professional practice, hydrocodone is used to combat moderate pain. It is a controlled substance (narcotic) that is widely abused and it is frequently diverted from legitimate medical channels and distributed illicitly on the street for profit and abuse.
The superseding indictment alleges that beginning as early as September 2013 and continuing to October 8, 2015, Ware conspired with others to distribute and dispense hydrocodone through Great Southwest, Arlington Oaks, Redbird, AC Medical Clinic, and KSW pill mills knowing that the prescriptions for the hydrocodone had not been issued for a legitimate medical purpose by a medical practitioner acting in the usual course of professional practice. The superseding indictment further alleges that on approximately April 9, 2014, Ware knowingly used, carried, and brandished, or aided and abetted the use, carrying, or brandishing of a firearm (handgun) during and in relation to the drug trafficking crime of conspiracy to distribute a controlled substance.
A federal indictment is an accusation by a grand jury. A defendant is entitled to the presumption of innocence unless proven guilty. If convicted, however, conspiracy to distribute a controlled substance (hydrocodone) carries a maximum statutory penalty of 20 years in federal prison and a $1 million fine. The penalty for firearm offense, upon conviction, is not less than seven years in federal prison and a $250,000 fine.
Assistant U.S. Attorneys J. Nicholas Bunch and Myria Boehm are in charge of the prosecution.
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Eight Face Drug Charges in Multi-Count Federal IndictmentRead the Press Release
Jackson, Miss – Eight defendants have been named in a multi-count federal indictment charging conspiracy and possession with intent to distribute methamphetamine, announced U.S. Attorney Gregory K. Davis and Assistant Special Agent in Charge Daniel Comeaux of the DEA Jackson District Office. The indictment is the result of a two-year investigation by the federal Organized Crime and Drug Enforcement Task Force (OCDETF).
Allen Sims, 39, of Jackson, is charged with one count of conspiracy to possess with intent to distribute more than 500 grams of methamphetamine and more than 50 grams or more of actual methamphetamine, one count of possession with intent to distribute more than 500 grams of methamphetamine, and one count of possession with intent to distribute more than 50 grams of actual methamphetamine.
Keith Mullen, 45, is charged with one count of conspiracy to possess with the intent to distribute more than 50 grams of actual methamphetamine.
Vincent Taylor McGee, 29, of Raymond, is charged with one count of conspiracy to possess with the intent to distribute more than 500 grams of methamphetamine, and one count of possession with the intent to distribute more than 500 grams of methamphetamine.
Armando Arrellano-Delgado, 39, of Palmetto, Florida, is charged with one count of conspiracy to possess with the intent to distribute more than 500 grams of methamphetamine and more than 50 grams of actual methamphetamine, one count of possession with the intent to distribute more than 500 grams of methamphetamine, and one count of possession with intent to distribute more than 50 grams of actual methamphetamine.
Jose Pacheco, 39, of Jackson, is charged with one count of conspiracy to possess with intent to distribute more than 500 grams of methamphetamine and more than 50 grams of actual methamphetamine; and one count of possession with the intent to distribute more than 500 grams of methamphetamine.
Daniel Tejeda, 35, of Norcross, Georgia, is charged with one count of conspiracy to possess with intent to distribute more than 50 grams of actual methamphetamine, and one count of possession with the intent to distribute more than 50 grams of actual methamphetamine.
Juan Dunfrund, 41 of Victorville, California, is charged with one count of conspiracy to possess with intent to distribute more than 50 grams or more of actual methamphetamine, and one count of possession with intent to distribute more than 50 grams of actual methamphetamine.
Jerry Lewis, 39, of Jackson, is charged with one count of conspiracy to possess with intent to distribute more than 50 grams of actual methamphetamine, and one count of possession with the intent to distribute more than 50 grams of actual methamphetamine.
This case is scheduled for trial before Senior U.S. District Judge William H. Barbour on November 8, 2016. If convicted, the defendants face a maximum sentence of life in prison and a $10 million fine per count.
The case was investigated by the Drug Enforcement Administration, the Mississippi Bureau of Narcotics, and the Bureau of Alcohol Tobacco Firearms and Explosives with assistance from the Hinds County Sheriff’s Office, Ridgeland Police Department, Jackson Police Department, U.S. Marshals Service, Federal Bureau of Investigation, Mississippi Highway Patrol, Madison County Sheriff’s Office, Brandon Police Department, Rankin County Sheriff’s Office, Mississippi Department of Corrections, Pearl Police Department, Flowood Police Department, Bureau of Customs and Border Patrol, and the DEA Houston Field Division. Assistant United States Attorney Jerry L. Rushing is prosecuting the case.
The public is reminded that an indictment is merely a charge and should not be considered as evidence of guilt. The defendant is presumed innocent until proven guilty in a court of law.
Eagle Butte Man Charged with Failure to Register as a Sex OffenderRead the Press Release
United States Attorney Randolph J. Seiler announced that an Eagle Butte, South Dakota, man has been indicted by a federal grand jury for Failure to Register as a Sex Offender.
Kimo Little Bird, age 34, was indicted on September 13, 2016. He appeared before U.S. Magistrate Judge William D. Gerdes on September 20, 2016, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in custody and/or a $250,000 fine, a mandatory minimum period of 5 years up to life of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that between July 1, 2016, and August 11, 2016, Little Bird, a person required to register under the Sex Offender Registration and Notification Act, knowingly failed to register and update his registration.
The charge is merely an accusation and Little Bird is presumed innocent until and unless proven guilty.
The investigation is being conducted by the U.S. Marshals Service. Assistant U.S. Attorney Troy R. Morley is prosecuting the case.
Little Bird was remanded to the custody of the U.S. Marshals Service pending trial, which has been set for November 29, 2016.
District Man Found Guilty of First-Degree Murder While Armed in 2011 Slaying of 18-Year-Old in Northeast WashingtonRead the Press Release
WASHINGTON – Dwayne Hilton, 25, of Washington, D.C., has been found guilty of first-degree murder while armed and other charges for the 2011 slaying of a man in Northeast Washington, U.S. Attorney Channing D. Phillips announced today.
Hilton was found guilty on Sept, 21, 2016 of the murder charge, three counts of assault with intent to kill while armed, and related firearms offenses. The verdict followed a trial in the Superior Court of the District of Columbia. He is to be sentenced on Dec. 9, 2016, by the Honorable José M. Lopez. Hilton faces a potential sentence of life in prison.
According to the government’s evidence, on Nov. 26, 2011, at approximately 12:35 a.m., Hilton and an unknown accomplice followed the victim, 18-year-old Mico Briscoe, and his friends for approximately two blocks, as they walked to the Circle 7 convenience store in the 1200 block of Mount Olivet Road NE. Hilton and the accomplice ran up behind Mr. Briscoe and his friends. As Mr. Briscoe and three friends approached the front door of the Circle 7, they were shot approximately 19 times from behind. Mr. Briscoe was shot once directly in the back, and once from a ricochet in the clavicle. He died several hours later. One of his friends was shot in the elbow, and survived. The remaining two friends suffered graze wounds.
This shooting is believed to have arisen from an old rivalry between two neighborhood groups in the Trinidad and E Street/Rosedale areas. Hilton was arrested on Feb. 11, 2013, and has been in custody ever since.
In announcing the verdict, U.S. Attorney Phillips commended the work of those who investigated the case from the Metropolitan Police Department (MPD). He also expressed appreciation for the assistance provided by the U.S. Marshals Service, the FBI, and the District of Columbia Department of Forensic Sciences. He acknowledged the efforts of those who handled the case from the U.S. Attorney’s Office, including Assistant U.S. Attorney Chrisellen Kolb; Litigation Technology Specialist Leif Hickling; Investigative Analyst Zachary McMenamin, and Paralegal Specialists Benjamin Kagan-Guthrie, Sandra Lane, and Zekiah Wright. Finally, he commended the work of Assistant U.S. Attorney Shana Fulton, who investigated the case and secured the defendant’s indictment, and Assistant U.S. Attorneys Sharon Donovan and Alicia Long, who investigated and prosecuted the case.
Dallas Man Sentenced to 188 Months in Federal Prison for Role in Conspiracy to Transport, or Assist in Transporting, a Substance Represented to be Cocaine on Flights from DFW Airport as Part of an Undercover Law Enforcement OperationRead the Press Release
DALLAS — A Dallas-area man who admitted to his role in transporting a substance that was represented to be cocaine on flights from Dallas-Fort Worth International Airport (DFW) was sentenced today to a lengthy federal prison sentence, announced U.S. Attorney John Parker of the Northern District of Texas.
Moniteveti Katoa, a/k/a “Vince,” 53, was sentenced by U.S. District Judge Jane J. Boyle to 188 months in federal prison following his guilty plea in January 2016 to one count of conspiracy to possess with intent to distribute and distribute at least five kilograms or more of cocaine. Moniteveti Katoa has been in custody since mid-July 2015 following a law enforcement operation, led by the Federal Bureau of Investigation, the Dallas Police Department and Internal Revenue Service Criminal Investigation, in which numerous defendants were arrested on drug distribution conspiracy and related charges outlined in a federal superseding indictment returned by a federal grand jury in Dallas the previous month.
That superseding indictment charged Moniteveti Katoa, and three others, Funaki Falahola, 34, Molitoni Katoa, 34, and Janelle Isaacs, 42, with the cocaine distribution conspiracy offense. All four defendants have pleaded guilty to the offense. Molitoni Katoa was sentenced last week to 90 months in federal prison. Funaki Falahola is scheduled to be sentenced on October 20, 2016, and Janelle Isaacs is scheduled to be sentenced on December 1, 2016. The statutory penalty for the offense is not less than 10 years and up to life in federal prison and a $10 million fine.
Funaki Falahola told undercover officers he had family members that could transport controlled substances via commercial airline. Funaki Falahola introduced Moniteveti Katoa to agents as his Uncle and family leader. Molitoni Katoa was also introduced as Falahola’s cousin and a person that could smuggle controlled substances into the DFW airport through his job at the cargo area at the DFW airport. Moniteveti Katoa’s wife, Janelle Isaacs, worked for American Airlines.
According to documents filed in the case, the four used their positions of employment at DFW, or contacted a person or persons who had a position or positions of employment at DFW, to bypass security in order to transport kilogram quantities of a substance that was represented to be cocaine, in what they did not know was an undercover law enforcement operation. As part of the conspiracy, that ran from approximately April 18, 2013, through July 14, 2015, the substance that was represented to be cocaine was transported on commercial airlines flying from DFW to destinations in Las Vegas, Nevada; Newark, New Jersey; Phoenix, Arizona; Chicago, Illinois; Wichita Kansas; and San Francisco, California.
According to testimony at today’s sentencing hearing, Moniteveti Katoa told undercover agents in November 2014 that he had the DFW airport wired so well he could sneak a bomb into the airport if he wanted to. In December 2014, agents asked Moniteveti Katoa if he would be willing to smuggle plastic explosives into the airport. Moniteveti Katoa initially expressed concern about the possibility of the explosives exploding in an airplane. After being told by undercover officers that they would not explode without a detonator, Moniteveti Katoa agreed to smuggle the explosives into the airport as he had done previously with the “cocaine.” Moniteveti Katoa agreed to bypass security at DFW airport and then hand the explosives to another person for that person to fly the explosives on an airplane to another city.
Falahola introduced Moniteveti Katoa to the undercover officer who was interested in smuggling cocaine from DFW Airport. He noted that Moniteveti Katoa had worked for American Airlines for 25 years and was a leader in the Tongan community. Falahola advised the undercover officers that they could transport the cocaine to major U.S. cities as well as to Hawaii and New Zealand. Moniteveti Katoa advised the undercover officer that he was willing to fly to locations in advance of smuggling the cocaine to conduct security checks.
According to plea documents filed in his case, from September 2013 through May 2015, Moniteveti Katoa smuggled what he thought was cocaine on at least six flights from DFW Airport to Las Vegas, Newark, Chicago, Wichita, San Francisco, and Tempe, Arizona.
The FBI, Dallas Police Department and Internal Revenue Service Criminal Investigation led the investigation with assistance from the Texas Department of Public Safety; the DFW Department of Public Safety; the U.S. Department of State; the Drug Enforcement Administration; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Transportation Security Administration; the U.S. Secret Service; U.S. Immigration and Customs Enforcement’s Enforcement and Removal Operations; and the Fort Worth, McKinney, Mesquite, and Plano Police Departments.
Assistant U.S. Attorney George Leal is in charge of the prosecution.
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Dallas Man Sentenced to 151 Months in Federal Prison for Role in Methamphetamine Trafficking ConspiracyRead the Press Release
DALLAS — Juan Vargas-Camacho, a/k/a “Ballecito,” 47, of Dallas, was sentenced yesterday afternoon by Chief U.S. District Judge Barbara M. G. Lynn to 151 months in federal prison, following his guilty plea in April 2016 to one count of conspiracy to distribute 50 grams or more of methamphetamine, announced U.S. Attorney John Parker of the Northern District of Texas.
According to documents filed in the case, during the course of the investigation, law enforcement intercepted numerous communications between Vargas-Camacho and others who were distributing methamphetamine. Vargas-Camacho’s supply source was co-defendant Aduato Olvera, 34, of Garland, Texas. On several occasions Olvera delivered large quantities of methamphetamine to Vargas-Camacho, and in November 2014, law enforcement stopped Vargas-Camacho after he left Olvera’s business and seized 486.3 grams of methamphetamine from a black bag on the passenger side floorboard.
To date, Judge Lynn has sentenced six of the 41 defendants charged in the conspiracy: Juan Aleman-Escamilla, 31, of Dallas, was sentenced to 168 months; Raul Torrres Zamora, 28, of Dallas, was sentenced to 63 months; Luis Lopez-Cruz, 33, of Oklahoma City, was sentenced to 78 months; and Jose Montes, Jr., 22, of Dallas, was sentenced to 188 months in federal prison. Each pleaded guilty to their role in the methamphetamine distribution conspiracy that began operating in north Texas in approximately May 2014.
Most of the remaining defendants have pleaded guilty and are awaiting sentencing. One is set for trial on November 8, 2016.
The case was investigated by the Drug Enforcement Administration and the Dallas Police Department.
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Current and Former Omaha Tribal Council Members and Employees IndictedRead the Press Release
United States Attorney Deborah R. Gilg announced today that the federal grand jury has returned a twenty count indictment charging nine people with various offenses. Eight are current or former members of the Omaha Tribal Council and one is a current employee of the tribe. Jessica Webster-Valentino (age 46), Barbara Freemont (age 64), Amen Sheridan (age 55), Rodney Morris (age 62), Doran Morris, Jr. (age 45), Forrest Aldrich (age 66), Mitchell Parker (age 68), Tillie Aldrich (age 47), and Jeff Miller (age 52) were each charged with conspiracy, conversion and misapplication of funds from a program receiving Federal funds, and conversion and misapplication of funds of a health care benefit program. An arraignment date for each of the defendants will be set by the Clerk of the District Court, but the hearings are anticipated to be in late October.
A conspiracy conviction is punishable by up to five years of imprisonment and/or a $250,000 fine. A conviction for conversion or misapplication of funds from a program receiving Federal funds is punishable by up to ten years of imprisonment and /or a $250,000 fine. A conviction for conversion or misapplication of funds of a health care benefit program is punishable by up to ten years of imprisonment and/or a $250,000 fine.
According to the Indictment, the Omaha Tribe of Nebraska had filed Contract Disputes Act claims against the Indian Health Service, an agency of the United States Department of Health and Human Services. These claims were filed in 2005 and 2012 and concerned unpaid contract support costs covering the period of 1995-2011. The total amount of the claims was approximately $8.9 million. The Indictment alleges that the defendants converted and misapplied $388,792.44 by causing the issuance of bonuses or incentives to themselves and several other tribal employees on account of the claim filings. These bonuses or incentives were paid in October of 2012 even though the claims against the Indian Health Service were not resolved and paid until late 2015. Funds used to pay the bonuses came from carryover funds from the fiscal year 2012 contract with IHS. These funds were supposed to be used for providing health care to members of the Omaha Tribe of Nebraska through the Carl T. Curtis Health Education Center. The indictment alleges that Jessica Webster-Valentino and Barbara Freemont each received bonuses of $89,692.92, while Amen Sheridan, Rodney Morris, Doran Morris, Jr., Forrest Aldrich, Mitchell Parker, Tillie Aldrich, and Jeff Miller, as tribal council members, each received bonuses of $13,404.44.
Webster-Valentino and Freemont are charged with conspiring together to obtain money to which they were not entitled. The Indictment alleges Webster-Valentino and Freemont: (a) directly and indirectly misrepresented the level of their involvement in the preparation of the claims submitted to IHS for unpaid contract support costs; (b) made a proposal to the tribal council for authorization of unreasonable bonus or incentive payments in the amount of $89,362.92 to be paid to each of them and which proposal also included unreasonable bonus amounts to be paid to members of the tribal council in order to induce the council to approve the proposal; (c) caused checks to be prepared and issued in-house from the Carl T. Curtis Health Education Center account without going through the normal review and issuance procedure the Omaha Tribe had established with the accounting firm of Bland& Associates; and (d) caused or allowed checks to be distributed and cashed prior to tribal council approval being obtained for the aforesaid bonus or incentive proposal. The Indictment further alleges that Webster-Valentino and Freemont exchanged emails discussing what bonus amounts to propose, and that in one such email Freemont suggested increasing the amounts to be paid to the tribal council members and indicated her belief that the tribal council would not complain about the payments to Webster-Valentino and Freemont if the tribal council members got a little more for themselves.
Amen Sheridan, Rodney Morris, Doran Morris, Jr., Forrest Aldrich, Mitchell Parker, Tillie Aldrich, and Jeff Miller are charged with conspiring together to obtain money to which they were not entitled. The Indictment alleges the payments to these defendants: (a) were not regular tribally approved salary payments; (b) were unreasonable in amount; (c) were unearned; (d) were not in compliance with the provisions of Omaha Tribe of Nebraska Resolution 09-19-A; (e) were prematurely paid; (f) were not related to the purposes for which funds were to be used pursuant to the IHS contract; and (g) were otherwise contrary to the provisions of OMB Circular A-87.
The Indictment further alleges that on November 5, 2012, the same date when the tribal council approved the bonuses described above, the tribal council passed a second motion to pay a bonus of $7,500 apiece to former tribal council members dating back to 1994 for their purported oversight of the Contract Disputes Act issue. This motion would have provided an additional payment of $7,500 to Amen Sheridan, Rodney Morris, Doran Morris, Jr., Forrest Aldrich, Mitchell Parker, Tillie Aldrich, and Jeff Miller as they were each members of past tribal council. However, the indictment alleges these amounts were not paid because Webster-Valentino refused to permit funds of the Carl T. Curtis Health Center to be used for this purpose.
In addition to the conspiracy charges, the Indictment charges each of the defendants in separate counts with substantive acts of: (a) converting or misapplying funds from a program receiving federal funds; and (b) converting and misapplying funds of a health care benefit program.
“These individuals used their elected positions to enrich themselves by betraying the trust of their peers. The FBI Omaha Division will remain steadfast in aggressively investigating those responsible for perpetrating schemes like this,” said Randall C. Thysse, Special Agent in Charge of the FBI’s Omaha Division.
This case was investigated by the Federal Bureau of Investigation and the Office of Inspector General for the Department of Health and Human Services.
Columbus Gang Member Pleads Guilty to Rackteering Conspiracy, Including Zanesville MurderRead the Press Release
COLUMBUS, Ohio – Deshawn M. Smith, 29, of Columbus, Ohio pleaded guilty in U.S. District Court today to one count of racketeering conspiracy in connection with a case involving the organized criminal enterprise known as the Short North Posse. Smith’s trial was scheduled to begin on Monday, September 26.
As part of his plea, he took responsibility for one previously unsolved murder, Shane McCuen on March 11, 2008 in Zanesville.
Smith’s plea contains a sentencing range of at least 30 and up to 35 years in prison.
Benjamin C. Glassman, Acting United States Attorney for the Southern District of Ohio, Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Timothy J. Plancon, Special Agent in Charge, Drug Enforcement Administration (DEA), Brad Earman, Acting Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Franklin County Prosecutor Ron O’Brien and Columbus Police Chief Kim Jacobs announced the plea entered into today before U.S. District Judge Algenon L. Marbley.
A total of 20 individuals were indicted in the racketeering case with charges that included murders, attempted murders, drug trafficking, weapons offenses, witness tampering, extortion and robbery.
A United States District Court jury convicted five co-defendants of racketeering and murder in June. After a two-month trial, the group of defendants was convicted on all counts, which accounted for 10 of 14 previously unsolved murders. The trial for the final defendant is scheduled for November 28.
Acting U.S. Attorney Glassman commended the two-year investigation by federal, state and local law enforcement agencies, including the FBI, DEA, ATF, Columbus Police, Franklin County Sheriff Zach Scott’s Office, Franklin County Prosecutor Ron O’Brien’s Office, Fairfield County Prosecutor Gregg Marx, Licking County Prosecutor Kenneth Oswalt, Muskingum County Prosecutor D. Michael Haddox, Ross County Prosecutor Matthew S. Schmidt, law enforcement leaders from those counties, officials of the Ohio Department of Rehabilitation and Correction, as well as Assistant U.S. Attorneys David DeVillers, Kevin Kelley and Brian Martinez, and Special Assistant U.S. Attorney Jimmy Lowe of Franklin County Prosecutor O’Brien’s Office, who are representing the United States in the case.
City of Seattle Agrees to Natural Resource Damages Settlement Using New Market-Based ApproachRead the Press Release
A settlement has been reached with the city of Seattle, Washington, to resolve its liability for injured natural resources at the Lower Duwamish Waterway Superfund Site in Seattle by funding restoration projects, the Justice Department announced today. To restore the natural resources, the city of Seattle has purchased restoration credits from Bluefield Holdings, a company that develops restoration projects. This is the first natural resource damages settlement to fund restoration through the purchase of credits in restoration projects developed by a restoration development company. Each of the contemplated restoration projects address natural resource injuries at the site and the trustees will oversee and ensure the projects are constructed and implemented appropriately.
The settlement is a collaboration involving the city of Seattle, Bluefield Holdings and the Lower Duwamish Waterway Superfund Site natural resource trustees: the National Oceanic and Atmospheric Administration (NOAA), the Department of the Interior (DOI), the Washington State Department of Ecology, the Suquamish Tribe and the Muckleshoot Indian Tribe. The city of Seattle purchased restoration credits from Bluefield to account for the city’s share of the injuries to natural resources from hazardous substances released into the Lower Duwamish Waterway. The city’s credit purchase totals approximately $3.5 million worth of restoration, when calculated using the cost of projects developed directly by the natural resource trustees. In addition, the city will make available a number of properties along the Lower Duwamish Waterway for potential restoration project development by Bluefield.
“The city of Seattle is acting responsibly to resolve its liability for injuries to natural resources by acting to restore those resources by creatively utilizing restoration credits,” said Assistant Attorney General John C. Cruden for the Justice Department’s Environment and Natural Resources Division. “Everyone comes out ahead when parties resolve their liability in this way, and the benefits of this resolution, cleaner waterways, will be enjoyed by Seattle residents and generations to come.”
Projects developed by restoration development companies can have advantages over more traditional restoration approaches. For responsible parties that prefer not to develop restoration projects themselves, purchasing credits can be less expensive than paying the natural resource trustees to build a project. And while natural resources trustees must certify and monitor restoration projects built by others for credits generated by those projects to be suitable to settle natural resource damages liability at the impacted site, this arrangement is much less time-intensive for the trustees than designing and constructing projects themselves.
“Settlements like this demonstrate that when trustees work with responsible parties to focus on natural resources we can restore the environment without litigation,” said Regional Director Robyn Thorson of the Interior Department’s Fish and Wildlife Service, Pacific Region 1.
“Today's agreement shows that natural resource trustees' obligation to restore injured resources and compensate for lost use can be met by innovative approaches like the restoration credits approach used here,” said Lois Schiffer, General Counsel of NOAA. “NOAA is pleased that the Bluefield Holdings’ projects will compensate for the natural resource injuries that occurred from the releases of hazardous substances by responsible parties into the Lower Duwamish River as well as those from Harbor Island and Lockheed West Superfund Sites. These innovative approaches save money and that assure the public that the right kind of restoration will be implemented for each site on an expedited basis.”
The Lower Duwamish Waterway Superfund Site is one of the largest Superfund sites in Washington State and includes the stretch of the Duwamish River that flows into Elliott Bay in Seattle. Over the years, a number of industrial and municipal operations have polluted the site with hazardous substances. The natural resource trustees have previously settled with The Boeing Company for natural resource damages related to its polluting activities along the Lower Duwamish Waterway.
The consent decree, lodged in the U.S. District Court for the Western District of Washington, is subject to a 30-day public comment period and approval by the federal court. A copy of the consent decree is available on the Justice Department Web site at www.justice.gov/enrd/Consent_Decrees.html.
Cincinnati Man Sentenced to 12 Years in Prison for Coercion and EnticementRead the Press Release
CINCINNATI – Martell A. Lowry, 27, of Cincinnati, was sentenced in U.S. District Court to 144 months in prison for production of child pornography and coercion and enticement. The sentence also calls for him to be under court supervision for the rest of his life.
Benjamin C. Glassman, Acting United States Attorney for the Southern District of Ohio, Hamilton County Sheriff Jim Neil, Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), and other members of the Regional Electronics and Computer Investigations Task Force (RECI) and Greater Cincinnati Internet Crimes Against Children Task Force (ICAC), announced the sentence handed down today by U.S. District Judge Michael R. Barrett.
Lowry used Facebook to contact young teenage boys for the purpose of soliciting sex from the juveniles. He offered to pay them to either let him perform oral sex on them or to send him nude photos of themselves.
The investigation identified more than 25 children as being victimized by Lowry. According to an indictment returned in April 2015, Lowry enticed and coerced at least 14 minors to engage in sexual activity.
Lowry pleaded guilty in July 2015 to coercion and enticement. While under court supervision, he will be required to register as a sex offender anywhere that he lives, works or goes to school.
Acting U.S. Attorney Glassman commended the investigation of this case by the Hamilton County Sheriff’s Office, FBI, RECI and Greater Cincinnati ICAC, and Assistant United States Attorneys Christy L. Muncy and Timothy D. Oakley, who prosecuted the case.
Charleston drug dealer sentenced to eight years in federal prison for methamphetamine crimeRead the Press Release
CHARLESTON, W.Va. – A Charleston man was sentenced today to eight years in federal prison for a methamphetamine charge, announced Acting United States Attorney Carol Casto. Terrus Carter, 36, previously entered his guilty plea to conspiracy to distribute a controlled substance.
Carter admitted that from December 2015 to March 2016, he conspired with Alisha Watts to distribute methamphetamine from their residence at 7270 Stonebrook Road in Charleston. Carter further admitted that he would bring methamphetamine and marijuana to the residence to store, repackage, and distribute the drugs. Watts permitted this criminal activity in exchange for Carter paying the rent and all of the bills at the residence.
On March 18, 2016, law enforcement executed a search warrant at the Stonebrook residence and seized a loaded handgun, over 620 grams of methamphetamine, over 120 pounds of marijuana, and over $34,000 in cash. On March 20, 2016, officers executed another search warrant at 111 1st Avenue in St. Albans. During the execution of the search warrant, Carter attempted to flee out of the back door and was quickly detained by law enforcement. Officers discovered over $45,000 in cash at the St. Albans residence. As part of his plea agreement, Carter agreed to forfeit the St. Albans residence and the cash seized by law enforcement.
Carter faces a minimum of five years and up to 40 years in federal prison when he is sentenced on August 18, 2016. Watts previously pleaded guilty in April 2016 to maintaining a drug-involved premises. Watts faces up to 20 years in federal prison when she is sentenced on August 17, 2016.
The investigation was conducted by the Metropolitan Drug Enforcement Network Team. Assistant United States Attorney Monica D. Coleman is handling the prosecution. United States District John T. Copenhaver, Jr., imposed the sentence.
This case 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 illegal drugs in our communities. 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 drugs in communities across the Southern District.
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Camden Man Pleads Guilty to Sex Trafficking of Minor After Posting Online AdvertisementRead the Press Release
TRENTON, N.J. – A Camden man pleaded guilty today to sex trafficking of a minor, U.S. Attorney Paul J. Fishman announced.
Aaron J. Gray, 29, of Camden, pleaded guilty before U.S. District Judge Peter G. Sheridan to an information charging him with one count of sex trafficking of a minor. Gray previously was charged in a criminal complaint with co-defendants Aja M. Easley, 22, of Camden, and Kenneth A. Mertz, 35, of Collingswood, with sex trafficking of a minor and conspiracy to engage in sex trafficking of a minor. Gray also was charged in the complaint with being a felon in possession of a firearm.
According to the documents filed in this case and statements made in court:
On March 2, 2015, Aja Easley communicated with the victim, a minor, using a popular social media website. Easley told the victim she was “worried about” the victim because of a previous assault by the victim’s ex-boyfriend. She offered the victim money, food, clothing, and shelter, and met the victim at the Camden Transportation Center. There, Easley told the victim about a “dating website,” and said that the victim could make money through the website by going on “dates.” Easley and the victim later met Gray and Mertz at a residence in Camden. Easley, Mertz, and Gray agreed to advertise the minor online for commercial sex acts for the purpose of earning money. To do so, Gray, Mertz, and Easley drove the minor to a motel in Cherry Hill.
At the motel, Gray and Easley convinced the victim to engage in commercial sex acts. Using her cellular telephone, Easley took provocative photos of the victim, and uploaded them to an online advertisement that she had created advertising the victim for commercial sex acts. After the advertisement was online, Easley used her cellular telephone to communicate with multiple individuals who responded to the advertisement seeking to engage in commercial sex acts with the minor. Gray gave the victim instructions on what to do when the respondents arrived. Easley instructed the victim to tell the individuals that, regardless of her real age, that she was 21 years old. Easley also instructed the victim how much time each individual could spend with the victim at the motel and how much each individual owed the victim. Easley and Gray also told the victim that if any trouble arose, Gray would be outside the motel with a firearm. While at the motel in Cherry Hill, the victim engaged in sex acts in exchange for money with multiple individuals, which the defendants split between themselves and the victim.
The next day, at a motel in Mount Laurel, New Jersey, at the defendants’ direction, the victim again engaged in sex acts in exchange for money with multiple individuals who responded to the advertisement. Later that evening, the defendants told the victim that they were taking the victim to Atlantic City, New Jersey, to meet another person who had responded to the advertisement and was willing to pay $1,200 for an entire evening with the victim. During the events on March 3, 2015, Gray was in possession of a semi-automatic firearm.
On the way to Atlantic City, the defendants agreed to let the victim stop at a residence in Gloucester City, New Jersey. The victim went inside and contacted the police, leading to the defendants’ arrest.
The count to which Gray pleaded guilty carries a statutory mandatory minimum of 10 years in prison, a statutory maximum of life in prison, and a maximum fine of $250,000. Sentencing is scheduled for Jan. 3, 2017.
On Aug. 17, 2016, Easley, pleaded guilty before Judge Sheridan to an information charging her with one count of sex trafficking of a minor and is scheduled to be sentenced Nov. 22, 2016.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher, and members of the Mount Laurel Police Department, under the direction of Police Chief Dennis Cribben, and the Gloucester City Police Department, under the direction of Acting Police Chief Brian Morell, with the investigation leading to todays’ guilty plea.
The government is represented by Assistant U.S. Attorney J. Brendan Day of the Office’s Criminal Division in Trenton.
The charges and allegations against Mertz remains merely an accusation, and he is considered innocent unless and until proven guilty.
Defense Counsel: Andrea D. Bergman Esq., Federal Public Defender’s Office, Trenton
Bus Company Owner Charged with Federal Tax Violations for Failing to Report Earnings from Chicago SchoolsRead the Press Release
CHICAGO — The owner of a transportation company that bused Chicago public school students spent corporate money to purchase and renovate a $500,000 home in the city’s Oakland neighborhood and illegally deducted the funds in U.S. tax filings, according to a federal indictment unsealed today.
JEWEL LOCKHART, the owner and president of Chicago-based Jewels Bus Co., is charged with one count of impeding the Internal Revenue Service, and six counts of willfully filing false tax returns. Lockhart, 71, of Chicago, will be arraigned in U.S. District Court on a future date to be determined by the Court.
From 2008 to 2013 Jewels Bus Co. contracted with Chicago Public Schools to provide daily bus service for its students. The company also provided service to various other clients, including individual CPS schools, for special events. The special event fees collected by the company were deposited into a separate bank account than the fees collected from CPS.
The indictment alleges that from 2009 to 2011 Lockhart concealed income from Jewels Bus Co.’s tax return preparer by failing to record the special events income in company books. Lockhart transferred money from the bus business to a company controlled by a relative, who used it to purchase a $500,000 home in the 800 block of East Oakwood Boulevard in Chicago’s Oakland neighborhood, according to the indictment. Lockhart and the relative, who isn’t named in the indictment, spent more than $600,000 in Jewels Bus Co.’s money to renovate the house, the indictment states. Lockhart later became a joint tenant in the home and used it as her personal residence, according to the indictment. Lockhart concealed the scheme by telling Jewels Bus Co.’s tax return preparer that the transferred funds and the renovation costs were tax-deductible corporate expenses, even though she knew the money was spent for her personal gain, the indictment states.
The indictment further alleges that Lockhart lied to an IRS officer during an interview in 2012 about Jewels Bus Co.’s alleged failure to remit all of the employment taxes it owed. Lockhart falsely stated that CPS was the company’s only client, without mentioning its numerous other customers.
For the calendar years 2009 through 2011, Lockhart reported to the IRS that Jewels Bus Co.’s corporate income was more than $30.8 million, the indictment states. In fact, Lockhart knew that the corporation’s total income for those years substantially exceeded that amount, according to the indictment. For the same three-year period, Lockhart reported individual earnings of more than $1.1 million. The indictment alleges that her actual personal income during that time substantially exceeded that amount.
The indictment was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; James D. Robnett, Special Agent-in-Charge of the Chicago Office of the Internal Revenue Service Criminal Investigation Division; Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation; Nicholas J. Schuler, Inspector General for the Chicago Public Schools; and Thomas D. Utz Jr., Special Agent-in-Charge of the U.S. Department of Education Office of Inspector General.
Each count of the indictment is punishable by up to three years in prison. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.
The public is reminded that an indictment is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
The government is represented by Assistant U.S. Attorney Steven Block.
IndictmentBradenton Woman Found Guilty of Witness Tampering and Obstruction of JusticeRead the Press Release
Tampa, Florida – United States Attorney A. Lee Bentley, III announces that a federal jury today found Delexsia Harris (24, Bradenton) guilty of witness tampering and obstruction of justice. She faces a maximum penalty of life in federal prison. Her sentencing hearing is scheduled for December 20, 2016. Harris was indicted on May 25, 2016.
According to testimony presented at trial, Harris threatened and intimidated multiple persons who were scheduled to serve as witnesses in the trial of United States v. Nathaniel Harris et al., which occurred this summer. Harris threatened and intimidated witnesses in person and on social media, threatening to hurt and murder individuals cooperating with law enforcement and telling one victim that Ms. Harris’s family would kill her and her children. Testimony also demonstrated that Harris had helped a defendant in that case solicit a false alibi.
In addition, testimony and evidence showed that Harris had lied to law enforcement officers following the July 3, 2012, murder of Ceola Lazier. Prosecutors presented evidence that she participated in the murder, with her brother and another man, and later told police officers that the killers were two unknown men driving a white Mercedes Benz. Harris’s brother, Charlie Green, and the other man, Jerry W. Green, were convicted of the shooting death of Ceola Lazier following the trial of United States v. Nathaniel Harris et al.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, with assistance from the Manatee County Sheriff’s Office. It is being prosecuted by Assistant United States Attorneys Natalie Adams and Shauna Hale.
Ballwin Area Man Pleads Guilty to Fraud ChargesRead the Press Release
St. Louis, MO – Darrin Landes pled guilty to wire fraud charges involving his scheme to sell sporting event tickets, but not delivering them to the purchasers after they sent payment to him.
According to court documents, from September 2015 to July 2016, Landes offered to sell tickets to sporting and entertainment events including the 2016 Kentucky Derby, the 2016 Masters golf tournament in Augusta, Georgia, and St. Louis Cardinals games. On some occasions, he offered to sell accommodations at hotels, resorts and/or homes. He frequently did not have tickets to sell to these prospective purchasers, and when he did have one ticket to an event, he attempted to sell the same ticket to someone else.
Landes and the prospective purchasers discussed the price for these tickets through face-to-face conversations, emails, texts and/or telephone conversations. The purchasers agreed to pay Landes and upon receipt of payment would send them the purchased items. Landes instructed the purchasers to send payment to him by wire transaction to either his PayPal account, one of his alleged business acquaintance’s PayPal accounts or, on some occasions, he met with the purchaser and obtained the money for the items he was selling. After the purchasers sent money to Landes and they did not receive the items that they paid for, and they attempted to contact Landes, he offered some excuse for the delay in sending the purchased item.
Landes , Ballwin, MO, pled guilty to one felony count of wire fraud before United States District Judge Rodney Sippel. Sentencing has been set for December 16, 2016.
Wire fraud carries a maximum penalty of 20 years in prison and or fines up to $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the Federal Bureau of Investigation and the Kirkwood Police Department. Assistant United States Attorney Anthony Franks is handling the case for the U.S. Attorney's Office.
Atlantic City, New Jersey, Man Admits Conspiring to Defraud IRS of Nearly $120,000 in TaxesRead the Press Release
CAMDEN, N.J. – An Atlantic City, New Jersey, man today admitted his role in a conspiracy to defraud the IRS of $119,880 in income taxes over three years, U.S. Attorney Paul J. Fishman announced today.
John Schultz, 74, pleaded guilty today before U.S. District Judge Joseph H. Rodriguez in Camden federal court to an information charging him with one count of conspiracy to defraud the United States.
According to documents filed in the case and statements made in court:
Schultz, William Boland, and another conspirator were partners in Royal Rolling Chairs Inc., a business based in Atlantic City that provided rolling chair transportation services to patrons on the boardwalk. As owners, they were responsible for accurately reporting income received by the business to the IRS.
Schultz admitted that he and his two partners hid gross cash receipts from the operation of the business and did not report this revenue to the IRS. He admitted that the business maintained a second set of books, which tracked the unreported cash revenue taken out of the business. The total tax loss from the conspiracy was $119,800.
The charge of conspiracy to defraud the United States carries a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gain or loss from the offense. Sentencing is scheduled for Jan. 9, 2017.
Boland previously pleaded guilty to the same conspiracy charge and is scheduled to be sentenced by Judge Rodriguez on Oct. 25, 2016. Abdus Mian, the bookkeeper for Royal Rolling Chairs, pleaded guilty to making false statements to federal investigators and was sentenced on April 4, 2016 to one year of probation.
U.S. Attorney Fishman credited special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen and special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher, Newark Field Office, with the investigation leading to today’s guilty plea.
The government is represented by Deputy Attorney in Charge Matthew J. Skahill of the U.S. Attorney=s Office in Camden.
Defense counsel: Edwin J. Jacobs Jr. Esq., Atlantic City
American Falls Man Pleads Guilty to Unlawful Possession of FirearmsRead the Press Release
POCATELLO – Joseph Edison McNutt, 35, of American Falls, Idaho pleaded guilty today to unlawful possession of firearms, U.S. Attorney Wendy J. Olson announced. McNutt was indicted by a federal grand jury on March 22, 2016.
According to the plea agreement, on December 27, 2015, McNutt was stopped by the Idaho State Police for a traffic violation on U.S. 91 in Bannock County, Idaho and arrested on an outstanding warrant. A search of McNutt’s vehicle revealed a Smith and Wesson .40 caliber pistol and a FEG 7.62 x 39 caliber rifle. McNutt admitted to unlawfully possessing both guns. McNutt was prohibited from possessing firearms under federal law, because he had been previously convicted of a felony, burglary in the second degree, in Pima County, Arizona in 2007.
The crime is punishable by up to ten years in prison, a maximum fine of $250,000, and three years of supervised release. Sentencing is set for December 13, 2016, before Chief U.S. District Judge B. Lynn Winmill at the federal courthouse in Pocatello.
The case was investigated by the Idaho State Police Department and the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF).
The case was prosecuted as part of Idaho’s Project Safe Neighborhoods Program, which seeks to reduce gun violence in Idaho.
Wednesday 21 September 2016
“Opiates in the Workplace”Read the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051BUFFALO, N.Y. – U.S. Attorney William J. Hochul, Jr. and Better Business Bureau of Upstate New York President Warren Clark will host “Opiates in the Workplace” tomorrow, September 22, 2016. There will be two sessions: 9:00-11:00 a.m. and 1:00-3:00 p.m. The program will be held at the WBBZ studios located in the Eastern Hills Mall. Week.
This free program is open to businesses throughout WNY to learn how to recognize the signs of addiction and ways employers can help your employees.
The Department of Justice has designated September 19-23, 2016 as Prescription Opioid and Heroin Epidemic Awareness Week to bring awareness to this epidemic which continues to devastate families across the country and right in our own community.Woman Sentenced for Bankruptcy Fraud SchemeRead the Press Release
LAS VEGAS, Nev. – A former Nevada realtor who owned at least 12 rental properties in Nevada and Texas and filed multiple bankruptcy petitions to avoid paying the mortgages, has been sentenced to 11 months in prison, two years of supervised release, and ordered to pay a fine of $10,000 and restitution of $83,000, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.
Barbara Jean Dennis, 60, of Las Vegas, was sentenced on Tuesday, Sept. 20, by U.S. District Judge Kent J. Dawson. Judge Dawson also entered an order restricting Dennis from engaging in real estate business during the period she is on supervised release.
“As this case demonstrates, the fallout from the housing crisis in Nevada is still impacting federal investigations and prosecutions,” said U.S. Attorney Bogden. “The prosecution of these cases typically takes years and requires a significant amount of resources. This sophisticated fraud scheme involved mortgage fraud, bankruptcy fraud, 12 properties in two states, and five bankruptcy petitions.”
Dennis pleaded guilty in February to bankruptcy fraud, admitting that she used the automatic stay provision in bankruptcy proceedings to avoid paying the mortgages, while at the same time, collecting rent from her tenants. Dennis filed three bankruptcy petitions in the District of Nevada and two in the Southern District of Texas between August 2009 and November 2010. The filing of the bankruptcy petitions caused the bankruptcy court to issue an automatic stay, which prevented the mortgage lenders from filing foreclosure proceedings on her properties during the pendency of the bankruptcy proceedings. Dennis also delayed the bankruptcy cases by failing to appear at hearings and meetings, failing to submit supporting financial documents and other paperwork to the Court, and failing to disclose prior bankruptcy cases. In one case, Dennis filed the bankruptcy petition under a false name and failed to disclose the other petitions and the names under which they had been filed. Over the course of the fraud scheme, from Aug. 31, 2009, through Dec. 17, 2010, Dennis received at least $150,000, but not more than $250,000 in rental income.
The case was prosecuted by Assistant U.S. Attorney Kathryn C. Newman and investigated by the FBI.
This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes. For more information about the task force visit: www.stopfraud.com.
Watkins Glen Man Sentenced for Manufacturing MethamphetamineRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051ROCHESTER, N.Y.-- U.S. Attorney William J. Hochul, Jr. announced today that Christopher Coy, 48, of Watkins Glen, NY, who was convicted of manufacturing methamphetamine, was sentenced to 18 months in prison by U.S. District Court Judge David G. Larimer.
Assistant U.S. Attorney Charles E. Moynihan, who handled the case, stated that on July 7, 2015 a search warrant was executed at 117 East Second Street, Apt 3, in Watkins Glen. Coy answered the door and was secured only after a brief struggle with officers. Officers searched the residence and found various component parts of a methamphetamine laboratory. Officers also located methamphetamine and approximately $105.00 in US currency.
Officers arrested Coy who told them he started using methamphetamine 10 years earlier and had been making methamphetamine two times per month for about a year and a half.The plea is the culmination of an investigation on the part of the Special Agents of the Drug Enforcement Administration, under the direction of Special Agent in Charge James J. Hunt, New York Field Division, the Schuyler County Sheriff’s Office, under the direction of Sheriff William E. Yessman, Jr., the Watkins Glen Village Police Department, under the direction of Chief Thomas Struble, and the New York State Police Community Narcotics Enforcement Team (CNET), under the direction of Major Wayne C. Olson.
Washington D.C. Man Pleads Guilty to Transporting Teenage Boy to Engage in Sexual ActivityRead the Press Release
BOSTON – A Washington D.C. man pleaded guilty yesterday in U.S. District Court in Boston in connection with transporting a teenage boy from Maryland to Boston and other states to engage in sexual activity.
Jason Michael Wolf, 30, pleaded guilty today to one count of transportation of a minor in interstate commerce to engage in illegal sexual activity. U.S. District Court Judge Allison D. Burroughs scheduled sentencing for Dec. 14, 2016.
On Aug. 17, 2015, the Massachusetts Bay Transportation Authority (MBTA) Police received information that an adult man and a minor were acting inappropriately at the South Station Bus Terminal. Law enforcement arrived on scene and interviewed the two individuals who were identified as Wolf and a 14-year-old boy from Maryland who was determined to be the subject of a missing persons warrant. The two admitted that they had met on a mobile dating app in July, had traveled to Boston from Maryland, and had engaged in sexual activity in Maryland, Washington D.C., New York, and Boston.
In August 2015, Wolf was arrested by the Boston Police and charged with aggravated statutory rape of a child under state law. That case is pending in Suffolk Superior Court.
The charge of transportation of a minor in interstate commerce to engage in illegal sexual activity provides for a minimum mandatory term of 10 years and up to a lifetime in prison, a minimum of five years and up to a lifetime of supervised release, and a fine of up to $250,000. 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; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Shelly Binkowski, Inspector in Charge of the U.S. Postal Inspection Service; Boston Police Commissioner William Evans; and Chief Kenneth Green of the MBTA Transit Police Department, made the announcement. The case is being prosecuted by Assistant U.S. Attorney Kenneth G. Shine of Ortiz’s Major Crimes Unit.