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Friday 19 August 2016
Riverside Man Sentenced for Possessing Child PornographyRead the Press Release
DAYTON – Frederick McAdoo, 57, of Riverside, Ohio was sentenced in U.S. District Court today to 30 months in prison for possessing more than 100 video files and more than 350 images of child pornography depicting victims as young as five years old.
Benjamin C. Glassman, Acting United States Attorney for the Southern District of Ohio, and Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division announced the sentence handed down today by U.S. District Judge Thomas M. Rose.
According to court documents, McAdoo accumulated and shared the digital images and videos for nine years, beginning in 2005. FBI agents patrolling the Internet in 2014 found the images in a file-sharing website and tracked them to McAdoo’s residence.
Investigators seized 11 hard drives, four computers, and more than 200 pieces of digital storage media during the investigation.
McAdoo will be notified when he is to surrender to the U.S. Bureau of Prisons to begin serving his sentence. After completing his time in prison, McAdoo will remain under court supervision for five years. While under court supervision, he must register as a sex offender anywhere that he lives, works or goes to school. Monitoring software will be installed on all of his computers. His computer use will be restricted and he must disclose any contact he has with minors.
McAdoo pleaded guilty on May 13, 2016 to one count of possession of child pornography.
Acting U.S. Attorney Glassman commended the cooperative investigation by the FBI and the Ohio Internet Crimes Against Children Task Force, as well as Assistant United States Attorney Alex R. Sistla, who is representing the United States in this case.
Randolph County Man Sentenced for Methamphetamine OffenseRead the Press Release
Donald S. Boyce, United States Attorney for the Southern District of Illinois, announced today that Christopher L. Dallas, 36, of Chester, was sentenced for a methamphetamine offense.
Dallas, who had previously pled guilty to a one-count indictment charging conspiracy to distribute methamphetamine, was sentenced to 120 months in prison, to be followed by three years supervised release. Dallas was also fined $200.00. Evidence at the plea and sentencing hearings established that Dallas was involved with others in the distribution of methamphetamine in the form of "ice." Ice is methamphetamine which has a purity level of at least 80%. At sentencing, the District Court found Dallas was responsible for the distribution of 115 grams of ice. The offense occurred between 2014 and June 2015 in Perry and Randolph Counties.
The investigation was conducted by the Randolph County Sheriff’s Office, Jackson County Sheriff’s Office, Perry County Sheriff’s Office, Perry County Drug Task Force, Percy Police Department, Steeleville Police Department, Illinois State Police Methamphetamine Response Team, DuQuoin Police Department, Pinckneyville Police Department, and Drug Enforcement Administration. The Randolph and Perry County States Attorney’s Offices also assisted in the investigation.
President of Kansas Ladder Company Pleads Guilty to Bribery at Tinker Air Force BaseRead the Press Release
Oklahoma City, Oklahoma – JEFFREY A. GREEN, 46, of Bartlesville, Oklahoma, pled guilty today to offering a bribe to a public official at Tinker Air Force Base, announced Mark A. Yancey, United States Attorney for the Western District of Oklahoma.
Green is the president and chief executive officer of LockNClimb, LLC ("LockNClimb"), with headquarters in Independence, Kansas. LockNClimb manufactures and sells specialty ladder systems. On July 7, 2016, Green was charged in a one-count Information with offering a bribe to a public official at Tinker Air Force Base ("Tinker"). The information alleged that, on May 10, 2016, Green provided United States currency to a public official at Tinker in exchange for that official’s purchase of ladders for the United States Air Force from LockNClimb.
At this morning’s plea hearing, Green admitted that he had contact from January through May of 2016 with a public official at Tinker and sold ladders to the official on three occasions. Green met with the official on May 10, 2016, at a restaurant in Oklahoma City, and gave the official approximately $280 in cash in exchange for the Air Force’s recent purchase of ladders from LockNClimb. Green further admitted that the cash payment was based on a percentage of LockNClimb’s recent ladder sale to Tinker, and that he had agreed with the Tinker official for LockNClimb to pay the official cash on the side for each ladder that the Air Force purchased from LockNClimb.
At sentencing, Green faces up to 15 years in prison and a fine of $250,000. United States District Judge Timothy D. DeGiusti will sentence Green in approximately 90 days. This charge is the result of an investigation conducted by the U.S. Air Force Office of Special Investigations, Federal Bureau of Investigation, and Defense Criminal Investigative Service. The case is being prosecuted by Assistant U.S. Attorney Chris M. Stephens.
Reference is made to court filings for further information.
Pharmacy Owner and Medical Doctor Charged in an Internet Scheme to Dispense Medications to Customers Without Valid PrescriptionsRead the Press Release
Customers received prescription drugs based solely on completion of online medical questionnaires
Sales exceeded $4 million
LOUISVILLE, Ky. – United States Attorney John E. Kuhn, Jr. this week charged several defendants and businesses, all tied to a multi-million-dollar internet scheme to dispense medications to customers without a valid prescription, with ten criminal charges. The indicted charges include an internet pharmacy conspiracy, conspiracy to distribute misbranded drugs, distributing misbranded drugs, mail fraud conspiracy, wire fraud conspiracy, health care fraud, engaging in the unlicensed wholesale distribution of prescription drugs, aggravated identity theft, conspiracy to commit money laundering, and obstruction of a criminal investigation.
Those charged were: Philip E Michael II of Alum Creek, West Virginia, and his business MEDS 2 GO, Inc. later known as MEDS 2 GO Express Pharmacy, Inc.; physician Euton Laing, of Piscataway, New Jersey, who is licensed to practice medicine in New Jersey, and was employed by RX Limited – a website selling prescription drugs over the internet; Mark Reinhard of Cross Lanes, West Virginia, who is charged with being an unlicensed wholesale distributor of prescription drugs; and Joetta Kuhn (of no familial relation to U.S. Attorney John Kuhn) of Louisville, Kentucky, who is charged with obstructing a criminal investigation.
According to the indictment, beginning in June of 2009 and continuing until at least April of 2012, defendant Philip Michael caused prescription drugs to be provided to customers of the website RX Limited. Specifically, through Aracoma Pharmacy and MEDS 2 GO Pharmacy, Michael filled and shipped various prescription drug orders to customers, for RX Limited and other internet websites, located across the United States and in the Western District of Kentucky, who did not have a valid prescription. These prescription drug orders were shipped to various states, which by law, required a valid prescription, prior to the drugs being dispensed. Customers would receive a prescription without ever seeing or speaking with a physician or medical practitioner, rendering the prescription invalid. Rather, customers would merely choose which prescription drug he or she wanted and complete an online medical questionnaire. The website operator would then send the completed online medical questionnaire by electronic means to an issuing doctor, including Eutan Laing, John Burlington, Edward Kaplan, and others known and unknown by the Grand Jury. (Physicians Burlington and Kaplan have pleaded guilty to charges in the Southern District of New York.) The drug would be prescribed without verifying the customers’ medical complaint, having an adequate patient history, performing a mental or physical exam, using appropriate diagnostic or laboratory testing, and providing a means to monitor the customer’s response to the medication. Then the invalid prescription would be filled by MEDS 2 Go or Aracoma, and shipped to customers across the United States.
During the course of the Internet Pharmacy Scheme, bank accounts controlled by Michael allegedly received approximately $4,000,000 from website operators, and others known and unknown to the Grand Jury. Physicians Laing, J.N.B., E.S.K., and others, were allegedly paid by website operators via wire transfers in excess of $800,000.
Further, MEDS 2 GO is charged with distributing misbranded drugs as the medications were not safe for use except under the supervision of a practitioner licensed by law to administer the drugs. Dispensing of Soma - a muscle relaxant, Ultram – a painkiller, and Fioricet – a treatment for tension headaches without a valid prescription caused the drugs to become misbranded.
Additionally, Michael is charged with defrauding a health care benefit program by submitting a fraudulent claim for payment to Humana Insurance Company for dispensing medication to P.R. which was never dispensed.
Also, Michael is charged with aggravated identity theft for using the name, date of birth and other identifying information for P.R. and the name and NPI number of A.S., a physician, to submit a fraudulent claim for payment.
In addition, proceeds from alleged criminal activities are subject to forfeiture to the United States. This includes, but is not limited to, an annuity and life insurance policy, vehicles associated with defendants Philip Michael and Meds 2 Go (2011 Jeep Grand Cherokee, 2011 Cadillac Escalade, 2008 Toyota Sequoia, and 2007 Chevy Corvette), a money judgement not less than 4 million dollars.
In the event of a conviction, the potential penalties range from 2 years to 20 years in prison for each specific count, a $250,000 fine for each count, and supervised release for a period of three years. The aggravated identity theft charge carries a minimum penalty of 2 years.
The case is being prosecuted by Assistant United States Attorney Lettricea Jefferson-Webb, and it results from an investigation conducted by the U. S. Food and Drug Administration, Office of Criminal Investigations, the Kentucky State Police and the West Virginia State Police.
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The charge of a person by Federal Indictment is an accusation only and that person is presumed innocent until and unless proven guilty
Pasadena Doctor Sentenced to 4 Years in Prison for Falsely Certifying Patients Were Terminally Ill as Part of Healthcare Fraud SchemeRead the Press Release
LOS ANGELES – A doctor from Pasadena who falsely certified that at least 79 Medicare and Medi-Cal patients were qualified for hospice care because they were terminally ill – when, in fact, the vast majority of them were not dying – has been sentenced to four years in federal prison.
Boyao Huang, 43, was sentenced on Monday by United States District Judge S. James Otero. In addition to the prison term, Judge Otero ordered Huang to pay $1,344,204 in restitution.
At the conclusion of a two-week trial in May, Huang was found guilty of four counts of health care fraud for participating in a scheme related to the Covina-based California Hospice Care (CHC). Between March 2009 and June 2013, CHC submitted approximately $8.8 million in fraudulent bills to Medicare and Medi-Cal for hospice-related services, and the public health programs paid nearly $7.4 million to CHC.
A second doctor who was convicted at trial – Sri Wijegoonaratna, known as Dr. J., 61, of Anaheim, who was found guilty of seven counts of health care fraud – is scheduled to be sentenced by Judge Otero on February 13, 2017.
“This scheme preyed upon dozens of patients and their families who were led to believe that their worst nightmare had come true – that they had life-ending illnesses,” said United States Attorney Eileen M. Decker. “Criminals such as the defendants in this case who steal from taxpayers by defrauding the Medicare system and who victimize vulnerable individuals like medical patients deserve significant prison sentences.”
In addition to the two doctors, eight other defendants were charged in the scheme and have pleaded guilty to health care fraud charges. Those other defendants include a Placentia woman who purchased CHC in 2007 and operated the facility after being charged and incarcerated in another health care fraud scheme. Priscilla Villabroza, 70, who pleaded guilty in December 2015 to one count of health care fraud, was sentenced in June to eight years in federal prison.
As part of the CHC fraud scheme, Villabroza and her daughter – who was the nominal owner while Villabroza was in custody – paid patient recruiters known as “marketers” or “cappers” to bring in Medicare and Medi-Cal beneficiaries. CHC nurses performed “assessments” to determine whether the beneficiaries were terminally ill and, regardless of the outcome, Wijegoonaratna and Huang certified that the beneficiaries were terminally ill – even though the vast majority of them were not dying. CHC personnel altered medical records in response to Medicare audits to make the beneficiaries appear sicker.
By the time the scheme was shut down in June 2013, Medicare and Medi-Cal had paid millions of dollars for medically unnecessary hospice-related services.
The investigation into California Hospice was conducted by the United States Department of Health and Human Services, Office of Inspector General; the Federal Bureau of Investigation; the California Bureau of Medi-Cal Fraud & Elder Abuse; and IRS Criminal Investigation.
This case is being prosecuted by Assistant United States Attorney Steven M. Arkow of the Major Frauds Section and Assistant United States Attorney Leon W. Weidman, Special Counsel to the United States Attorney.
Owner of Rainbow Center for Children Pleads to Defrauding TennCare of More Than $300,000Read the Press Release
Memphis, TN – The owner of a grief counseling and psychotherapy services provider has pleaded guilty to defrauding TennCare of more than $300,000. Edward L. Stanton III, U.S. Attorney for the Western District of Tennessee, announced the guilty plea today.
According to information presented in court, Vicky Fox, 53, of Memphis, Tennessee, owned and operated the Rainbow Center for Children and Adolescents. The establishment provided grief counseling and psychotherapy services to children and families in the Memphis area.
The Rainbow Center contracted with TennCare, the Tennessee-based program of Medicaid, from 2008 through 2013 and 2015. Under the contract, the Rainbow Center employed Licensed Clinical Social Workers (LCSWs) to provide counseling services. One of the LCSWs, Lillie Hughey, worked for the establishment until January 2012. After Hughey left the Rainbow Center, Fox used her former employee’s provider number and information to bill TennCare for counseling services that were never provided.
In August 2014, the Tennessee Bureau of Investigation (TBI) received a referral from the Bureau of TennCare, Program Integrity Unit (PIU) regarding a fraud investigation involving the Rainbow Center. The investigation revealed that Fox’s fraudulent claims scheme defrauded TennCare of more than $300,000.
On Friday, August 19, Fox pleaded guilty before U.S. District Judge John T. Fowlkes Jr. to one count of health care fraud.
Fox is scheduled to be sentenced onNovember 18, 2016. She faces up to 10 years in federal prison and a fine of up to $250,000.
This case is being investigated by TBI and the Bureau of TennCare.
Assistant U.S. Attorney Damon Keith Griffin is prosecuting this case on the government’s behalf.
North Miami Resident Pleads Guilty to Possessing 2,875 Stolen IdentitiesRead the Press Release
A North Miami resident pled guilty to possessing 2,875 stolen identities.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), Rafiq Ahmad, Special Agent in Charge, United States Department of Labor, Office of Inspector General (DOL-OIG), and William Hernandez, Chief, North Miami Beach Police Department (NMBPD), made the announcement.
Camelin Junior Desrosiers, 28, pled guilty to one count of possession of fifteen or more unauthorized access devices, in violation of Title 18, United States Code, Section 1029(a)(3), and one count of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A(a)(1). Sentencing is scheduled for October 25, 2016 before U.S. District Court Judge Darrin P. Gayles. At sentencing, Desrosiers faces a statutory maximum of ten years’ imprisonment for the access device charge, and a mandatory term of two years’ imprisonment, consecutive to any other prison term, for the aggravated identity theft charge.
According to court documents, on February 25, 2015, law enforcement initiated a traffic stop on a rental car leased by Desrosiers. The defendant, the driver, and a passenger were ordered to exit the vehicle. Because the vehicle contained after-market tinted windows, and because the tinted windows violated the rental car contract, law enforcement initiated a tow of the vehicle to return it to the rental car company.
An inventory search of the car was conducted prior to it being towed. In the trunk of the car, law enforcement found a laptop computer owned by Desrosiers. A forensic analysis of the computer revealed 2,875 pieces of personal identifying information (PII), including names, dates of birth and social security numbers.
Law enforcement spoke with one individual whose name, date of birth, and social security number were in the computer, and confirmed that he/she did not authorize Desrosiers to be in possession of the PII. Desrosiers knew that the names, dates of birth, and social security numbers belonged to real persons.
Mr. Ferrer commended the investigative efforts of IRS-CI, DOL-OIG, and the NMBPD. The case is being prosecuted by Assistant U.S. Attorney Joshua S. Rothstein.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
North Carolina Man Sentenced to 14 Years in Federal Prison for Providing Silicone Buttocks Injections Resulting in the Death of a ClientRead the Press Release
Greenbelt, Maryland – U.S. District Judge George J. Hazel sentenced Vinnie Lysander Taylor, a/k/a “T,” age 44, of Wilmington, North Carolina, Pennsylvania and Georgia, today to 14 years in federal prison, followed by three years of supervised release, for receiving and selling industrial grade silicone, but representing to customers that it was medical grade silicone. A client died as a result of receiving such injections.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Prince George’s County State’s Attorney Angela D. Alsobrooks; Special Agent in Charge Mark S. McCormack of the U.S. Food & Drug Administration, Office of Criminal Investigations’ Metro Washington Field Office; Chief Hank Stawinski of the Prince George’s County Police Department; and Chief J. Thomas Manger of the Montgomery County Police Department.
“FDA regulates medical devices to protect the public from potentially dangerous complications and side effects. Industrial-grade silicone that is injected into individuals’ bodies can cause serious bodily injury or death,” said Special Agent in Charge Mark S. McCormack, FDA Office of Criminal Investigations’ Metro Washington Field Office. “FDA’s OCI will continue to work with our law enforcement partners to bring to justice those who offer such dangerous products to the public.”
Taylor admitted that from at least 2008 through December 16, 2014, he administered silicone injections into the buttocks of customers who wanted larger or fuller buttocks. Taylor, who was not a licensed medical practitioner, falsely represented to customers and victims to whom he administered liquid silicone injections that the procedure was safe and that he used medical grade silicone, when in fact the silicone was not medical grade silicone. Taylor administered the injections in hotel rooms in Prince George’s County, Maryland, St. Louis, Missouri, Arlington, Virginia, and elsewhere. Taylor charged between $800 and $1000 for the initial injections and between $350 and $800 for subsequent injections. When used in this fashion, liquid silicone is a medical device subject to regulation by the FDA.
In Maryland, between at least 2012 and December 2014, Taylor administered silicone injections to more than 10 individuals, representing to each victim that he used medical grade silicone and that it was safe. In fact, Taylor did not use medical grade silicone, but used polydimethylsiloxane, a common silicone product used in commercial applications such as foods, lubricating oils, sealants and shampoos.
On March 20, 2014, Taylor injected silicone into the buttocks of a victim. After the victim left the hotel she began having breathing difficulties. On March 22, 2014, the victim checked herself into the hospital and two days later, she died. An autopsy determined that the cause of death was acute and chronic respiratory failure due to a foreign substance causing a pulmonary embolization. The medical examiner ruled the manner of death to be a homicide. A clear viscous fluid removed from the victim’s buttocks during the autopsy was determined to be polydimethylsiloxane.
According his plea agreement, from approximately 2008 through December 2, 2014, Taylor purchased 152 gallons of food grade liquid silicone. Taylor stored the liquid silicone in plastic bottles that were not labeled nor approved by the FDA for that purpose. Therefore, the liquid silicone was adulterated and misbranded. The 152 gallons of silicone equates to 3,196 sessions. At $500 per treatment, Taylor’s mid-range fee, proceeds from the illegal injections total at least $1,598,000.
As part of his plea agreement, Taylor has agreed to plead guilty to a criminal information filed in Prince George’s County Circuit Court, admitting that his conduct resulted in the death of the victim in March 2014. In exchange, the Prince George’s County State’s Attorney’s Office dismissed first degree murder charges which were pending against Taylor.
Taylor remains detained.
United States Attorney Rod J. Rosenstein praised the FDA Office of Criminal Investigations’ Metro Washington Field Office, the Prince George’s County Police Department, Montgomery County Police Department, and the Prince George’s County State’s Attorney’s Office for their work in the investigation and prosecution. Mr. Rosenstein thanked Assistant United States Attorney Deborah A. Johnston and William D. Moomau, who prosecuted the case.
Nebraska Resident Sentenced to Ten Years in Prison for Possession of Methamphetamine with Intent to Distribute and Possession of a Firearm by a Convicted FelonRead the Press Release
Council Bluffs, IA - On August 18, 2016, Tyler Jon Cross, a 25 year old resident of Lincoln, Nebraska, was sentenced by United States Senior District Court Judge Robert Pratt, to 120 months in prison for Possession of Methamphetamine with Intent to Distribute and Possession of a Firearm by a Felon announced United States Attorney Kevin E. VanderSchel. Judge Pratt also ordered Johnson to serve a term of 5 years of supervised release upon release from prison, and to pay a $100 special assessment.
The conviction resulted from an investigation conducted by the Iowa State Patrol which began on June 20, 2015 when Iowa State Patrol Troopers attempted to stop two motorcycles that were not displaying registration. A pursuit occurred along Interstate 80, with Cross operating his motorcycle in excess of 100 mph and driving into oncoming traffic. The pursuit ended after Cross left the interstate and traveled along two-lane roads in rural Pottawattamie and Shelby Counties, with Cross eventually losing control of his motorcycle leading to his arrest. In a backpack carried by Cross was discovered over one-half pound of methamphetamine and a loaded nine-millimeter handgun.
The case was investigated by the Iowa State Patrol, Shelby County Sheriff’s Office, Pottawattamie County Sheriff’s Office, and the Iowa Division of Narcotic Enforcement, and was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
Mexican National Sentenced to 10 Years in Federal Prison for Trying to Smuggle 20 Pounds of Cociane into CanadaRead the Press Release
Spokane – Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that that Hever Guzman Guerrero, a citizen of Mexico, age 28, was sentenced after having previously plead guilty to possession with the intent to distribute 5 kilograms or more of cocaine, a ten-year mandatory minimum federal offense. United States District Judge Rosanna Malouf Peterson sentenced Guzman Guerrero to a 10 year term of imprisonment, to be followed by a 5-year term of court supervision upon his deportation when released from federal prison, thereby prohibiting him from returning to the United States.
According to the information disclosed during court proceedings, Guzman Guerrero was under investigation by Homeland Security Investigations and Border Patrol in Wenatchee Washington for his involvement in cross-border drug smuggling activities. On September 2, 2015, he was caught near Oroville, Washington attempting to cross the U.S. / Canadian on foot. After hiding from law enforcement officers for over three hours in rugged terrain, Guzman Guerrero was located and in possession of a backpack containing over 20 pounds of cocaine. The approximate value of the drugs was well over $250,000. Although Guzman Guerrero was eligible for relief from the mandatory ten-year term of imprisonment, the Court found that he failed to be truthful with both the Court and law enforcement authorities and, therefore, the Court denied any such relief.
Michael C. Ormsby said, “This case was part of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation. The OCDETF program provides supplemental federal funding to the federal and state agencies involved in the investigation of drug-related crimes. I commend the Homeland Security Investigation and Border Patrol agents in the Spokane and Seattle Divisions who diligently worked this OCDETF case. Protecting the integrity of the United States’ borders is of utmost importance to the United States Attorney’s Office in the Eastern District of Washington.”
The investigation was conducted by the Homeland Security Investigation and Border Patrol agents in the Spokane and Seattle Divisions. This case was prosecuted by Stephanie Van Marter, an Assistant U.S. Attorney for the Eastern District of Washington.
Mexican Man Pleads Guilty to 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 Angel Mata, of Mexico, has pleaded guilty to illegally reentering the United States after having been deported previously.
Mata pleaded guilty before United States District Court Judge Paul Barbadoro to an indictment that had been returned by a federal grand jury on June 15, 2016.
According to court filings and statements in Court, a Deportation Officer developed information indicating that Angel Mata, a Mexican national, was present in the United States after having been deported on two previous occasions. On June 15, 2016, Deportation Officers approached the defendant who confirmed that his name was Angel Mata and that he was illegally present in the United States without any immigration documents. His identity later was confirmed through fingerprint information.
Mata will be sentenced at 10:00 AM on November 28, 2016, and will be deported after serving his sentence.
The case was investigated 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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Methamphetamine Conspirator Pleads GuiltyRead the Press Release
ABINGDON, VIRGINIA – Another member of the of a conspiracy that trafficked large quantities of methamphetamine from Atlanta to Southwest Virginia, pled guilty today in the United States District Court for the Western District of Virginia in Abingdon, United States Attorney John P. Fishwick Jr. announced.
Steven Roger Bryant, 42, pled guilty today in District Court to one count of conspiring to distribute methamphetamine.
“We will continue to devote as many resources as possible to slow the trend of methamphetamine trafficking into Southwest Virginia,” United States Attorney Fishwick said today. “Methamphetamine is a drug that destroys lives and communities and must be stopped.”
According to evidence presented at previous hearings by Assistant United States Attorney Zachary T. Lee, Bryant was part of a methamphetamine conspiracy that transported and distributed multiple pounds of crystal methamphetamine between Atlanta, Georgia, Northeast Tennessee and Southwest Virginia.
The investigation of the case was conducted by the Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Bristol, Virginia Police Department, the Bristol, Tennessee Police Department, the Abingdon Police Department and the Washington County Sheriff’s Office. Assistant United States Attorney Zachary T. Lee prosecuted the case for the United States.
Media Advisory: University of Northern Iowa Hosts Hate Crimes/Bias Incident ForumRead the Press Release
CEDAR RAPIDS, IA – The United States Attorney’s Office for the Northern District of Iowa is joining with the FBI, DOJ’s Community Relations Service, Black Hawk County Attorney and Sheriff’s Offices, Waterloo Police Department, Waterloo’s Human Rights Commission, and the Cedar Falls Police Department to host a forum designed to identify and address key issues related to hate crime reporting, investigation, prosecution and prevention. The forum is designed to build collaboration among key partners in an effort to prevent and respond to bias incidents and hate crimes.
U.S. Attorney Kevin W. Techau will be present and joined by Darryck Dean, a DOJ Conciliation Specialist with the Community Relations Service located in Kansas City. Mr. Dean was actively involved in community conciliation efforts following the incidents in Ferguson, Mo. A flyer announcing the forum is attached.
Event Details
When: Tuesday, August 23, 2016
Where: University of Northern Iowa – Center for Urban Education
800 Sycamore, Waterloo, Iowa 50703
Time: Starts at 6:00 p.m., ends at 8:00 p.m.
This is a “pen and pad” opportunity for the press. Photography permitted. A press release will be provided and interview opportunities will be available.
Follow us on Twitter @USAO_NDIA.
Manhattan U.S. Attorney Announces Another Arrest for May 2015 Gunpoint Robbery of Watch Store in Midtown ManhattanRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Charlie Patterson, the Acting Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms & Explosives (“ATF”), and William Bratton, the Police Commissioner of the City of New York (“NYPD”), announced the arrest of CHRISTOPHER MULLIGAN on charges of robbery conspiracy, robbery, and a firearms offense. MULLIGAN was arrested yesterday in Stockton, California, and will be presented later today in U.S. District Court for the Eastern District of California.
One other defendant, Omar Rawlins, was arrested on May 12, 2015, the day of the robbery, in connection with the same charges, contained in a Complaint. Rawlins’s case was assigned to the Honorable Kimba M. Wood, United States District Judge for the Southern District of New York, and he pled guilty to participating in a conspiracy to rob the Tourneau Watch Store. Rawlins’s sentencing remains pending.
Manhattan U.S. Attorney Preet Bharara said: “In broad daylight in Midtown Manhattan, Mulligan and his co-conspirators allegedly carried out a gunpoint robbery of a Madison Avenue watch store, stealing not just Rolex watches worth more than $700,000, but robbing New York City residents of their sense of security. Thanks to good old-fashioned police work by the ATF and the NYPD, Mulligan has joined his alleged co-conspirator Omar Rawlins in facing federal criminal charges.”
ATF Acting Special Agent in Charge Charlie Patterson said: “This arrest is the culmination of the diligent investigative work of the ATF Special Agents and NYPD Detectives assigned to the ATF SPARTA Task Force, which investigates armed commercial robberies throughout New York City. The arrest of Mr. Mulligan should serve as a warning to those out there engaged in these violent crimes that we will bring the full force of the federal justice system to bear against you. While it may seem that you can receive a quick payday by committing an armed robbery, the price you will pay is a lengthy prison sentence in a federal penitentiary. ATF would like to extend our gratitude to the NYPD and the United States Attorney’s Office for their continued partnership in combatting violent crime in New York City.”
NYPD Commissioner William J. Bratton said: “This violent crime at a Midtown watch store took 60 seconds to commit, but after being indicted and apprehended in California, the defendant’s time on the lam has run out and he’s facing decades in prison if convicted. I want to thank the investigators from the Southern District, the ATF and the NYPD who worked on this investigation and tracked the defendant to Pennsylvania and then cross-country.”
According to the allegations contained in the Indictment charging MULLIGAN, the Complaint[1] charging Rawlins, and other documents in the public record, and statements made in court:
On May 12, 2015, MULLIGAN, Rawlins, and a third individual committed a gunpoint robbery of the Tourneau Watch Store (“Tourneau”) in Midtown Manhattan. At the time of the robbery, all three men were dressed in suits and fedoras. After entering Tourneau, one of the men produced a gun and fired a round into the floor. The bullet fragmented, and a customer was hit with a bullet fragment, receiving a minor laceration. The two other robbers hit one of the glass display cases with hammers. The display case shattered, and the two robbers began removing watches from the display case. A Tourneau employee stuck his head out through a door behind the display case. The robber with the gun fired a shot in the direction of the employee, who was not hit. After approximately one minute, all three robbers exited Tourneau and began running. They were pursued by NYPD officers, who caught up to and arrested Rawlins. When Rawlins was arrested, he was carrying, among other things, five watches, a hammer, two pairs of gloves, a yellow hard hat, and a yellow safety vest. Surveillance footage captured some of MULLIGAN, Rawlins, and the third robber’s activities as they executed the robbery. In total, the crew obtained approximately 20 Rolex watches, worth approximately $730,000.
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MULLIGAN, 22, of Brooklyn, is charged with one count of robbery conspiracy, which carries a maximum sentence of 20 years in prison; one count of robbery, which carries a maximum sentence of 20 years in prison; and one count of use of a firearm, which carries a maximum sentence of life in prison. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge.
Mr. Bharara praised the investigative work of the ATF and the NYPD, and in particular, the ATF Strategic Pattern Armed Robbery and Technical Apprehensions (“SPARTA”) Task Force. Mr. Bharara also thanked the United States Marshals Service and the United States Attorney’s Office for the Eastern District of California for their assistance in the arrest and apprehension of MULLIGAN.
The case is being prosecuted by the Office’s Violent and Organized Crime Unit. Assistant United States Attorneys Jessica Lonergan and Christopher J. Clore are in charge of the prosecution.
The charges contained in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the texts of the Indictment and the Complaint and the descriptions of the Indictment and Complaint set forth below constitute only allegations, and every fact described should be treated as an allegation.
Male and Female Child Pornography Production Team Sentenced to a Total of 100 Years in Federal PrisonRead the Press Release
DENVER – Acting U.S. Attorney Bob Troyer and Acting FBI Special Agent in Charge Calvin Shivers announce that U.S. District Court Judge William J. Martinez sentenced Matthew Scott Holt, age 35, to serve 660 months (55 years) and sentenced his co-defendant Jordain Larsen, age 27, to 540 months (45 years). Both defendants were ordered to serve a term of supervised release for the remainder of their lives once released. Each defendant pleaded guilty to three counts of production of child pornography involving three minor victims.
Holt and Larsen were first charged in May of 2015. Larsen pled guilty to three counts of the production of child pornography on January 8, 2016. She was sentenced on April 20, 2016. Holt pled guilty to three counts of the production of child pornography on February 23, 2016, and was sentenced August 17, 2016.
According to court documents, Westminster Police Department executed a search warrant on a residence in Westminster, Colorado after an undercover officer with the Larimer County Sheriff's Office had downloaded an image of child pornography from the residence that showed a woman sexually abusing a very young child. In the days following, WPD found images and videos on Holt’s cell phone showing him sexual abusing a child under the age of two. WPD contacted the FBI. A search of computers seized at the residence revealed that Holt and Larsen produced a total of approximately 600 child pornography images and videos of three children to whom they had access. Two of the children were under the age of two and the third was under the age of nine. The images and videos show either Larsen or Holt molesting the children, or they display the children in a sexually explicit way. Eight of the videos were created when Larsen sexually abused one of the children via the online video platform Skype while video conferencing with Holt. Holt watched and recorded the sessions on his cell phone. Larsen and Holt created other sexually explicit images of the children and sent them to each other. They produced others when engaging in sexual activity with the children while together. Holt also sexually exploited one of the children while on Skype with another unidentified person. On one of Holt’s computer, FBI found approximately 20,000 images of child pornography and four different peer-to-peer trading software programs. FBI also found on Holt’s computer a peer-to-peer profile seeking a “pedo mom” with children between the ages of 2-10 who was willing to Skype.
The Holt and Larsen case was investigated by the Federal Bureau of Investigation (FBI), the Westminster Police Department, and the Larimer County Sheriff's Office.
The defendants were prosecuted by Assistant U.S. Attorney Judith Smith, Chief of the Special Prosecutions Section of the U.S. Attorney’s Office Criminal Division.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and 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.justice.gov/psc.
Long Island Man Pleads Guilty to Foreign Currency Fraud SchemeRead the Press Release
CENTRAL ISLIP, NY – Earlier today, Daniel Winston LaMarco pleaded guilty to a felony information charging him with wire fraud and commodities fraud causing losses of more than $862,000 to 13 investors. Today’s plea took place before United States Magistrate Judge Gary R. Brown at the United States Courthouse in Central Islip, New York. When sentenced, the defendant faces a maximum sentence of 30 years’ imprisonment.
Today’s guilty plea was announced by Robert L. Capers, United States Attorney for the Eastern District of New York.
“LaMarco misled investors regarding his investment performance on a monthly basis for years and encouraged them to invest their money in risky and volatile markets,” stated United States Attorney Capers. “The message of this prosecution is clear – if you defraud investors for personal gain you will be investigated and prosecuted to the full extent of the law.” Mr. Capers thanked the criminal investigators in the United States Attorney’s Office for their excellent work on this investigation.
Beginning in or about January 2011, LaMarco began to solicit investors to fund a commodity pool he ran which invested in the Foreign Exchange Market. LaMarco made false claims regarding his investment performance, and touted the safety of his investment strategy. Among his victims, LaMarco encouraged two individuals to invest proceeds from a home equity loan with him. As part of his fraud scheme, LaMarco sent false monthly statements to investors representing that their investments were growing, inducing new investments from the investors, and discouraging them from withdrawing their investments with him. The monthly statements claimed the investments had more than doubled in value and were worth as much as $1,796,126.22. In truth, LaMarco had lost almost all of the investors’ money, which totaled more than $862,000, in the Foreign Exchange Market.
The government’s case is being prosecuted by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys Christopher A. Ott and Mark Bini are in charge of the prosecution.
This prosecution was the result of efforts by President Obama's Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ Offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory, and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions, and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, visit http://www.StopFraud.gov.
The Defendant:
DANIEL WINSTON LAMARCO
Age: 51
Huntington, New YorkE.D.N.Y. Docket No. 16-CR-433 (ADS)
Local Chemical Engineer Must Pay Approximately $4 Million in Restitution for Unlawfully Possessing Trade SecretsRead the Press Release
DALLAS — A Ph.D. chemical engineer from Sunnyvale, Texas, Dr. Mattias Tezock, 53, who admitted unlawfully possessing trade secrets from his former employer, Voltaix LLC, has been ordered by Chief U.S. District Judge Barbara M. G. Lynn to pay approximately $4 million in restitution to this former employer as part of the five-year term of probation that resulted from his pleas of guilty in this case. The trade secrets at issue concerned the manufacture, synthesis, and purification of germane gas, a specialty chemical used in the semiconductor and solar energy industries. Today’s announcement was made by U.S. Attorney John Parker of the Northern District of Texas.
In August 2015, Tezock pleaded guilty to four counts of unlawful possession of a trade secret. The facts supporting the guilty pleas established that from mid-April 2004 through September 2005, Tezock was employed as a chemical engineer at Voltaix, LLC, a multinational corporation headquartered in North Branch, New Jersey. Over approximately 25 years and at great expense, Voltaix developed a specific, industry-leading and exacting secret and confidential scientific method to make and purify germane gas to specifications required by its customers. Tezock further admitted that Voltaix took reasonable measure to keep this information secret and confidential and that Voltaix derived economic value from it not being known to, or readily ascertainable through proper means, by the public. As part of his employment at Voltaix, Tezock agreed to and signed non-compete and employee confidentiality forms that prohibited him from improper disclosures of Voltaix’s confidential, proprietary, and trade secret information.
Voltaix terminated Tezock’s employment in September 2005. Thereafter, Tezock moved to Texas where he established Metaloid Precursors, Inc., a company based in Terrell, Texas, that manufactured, produced, purified, and sold the specialty gas, germane. Almost immediately upon his termination from Voltaix, Tezock began taking steps to misappropriate Voltaix’s confidential, proprietary, and trade secret recipe and process for manufacturing and purifying germane gas and later attempting to steal business from Voltaix by actively soliciting at least one of Voltaix’s customers.
During subsequent civil litigation brought by Voltaix, Tezock took steps to hide his possession of trade secret information by deleting files or manipulating computer evidence in order to prevent Voltaix from learning the scope and magnitude of his breach. Tezock also provided false testimony under oath in a deposition during the civil litigation.
As part of the plea agreement resolving the criminal charges, Tezock agreed to take steps to terminate his business and destroy the germane processing plant. Among other things, immediately upon entering the guilty plea, Tezock immediately was required to cease and desist accepting, soliciting, receiving, or entering into new orders, soliciting business, or engaging in any manufacturing or refining work at Metaloid Precursors. Tezock further surrendered the keys to the Metaloid Precursors building and later worked to dismantle, destroy, and remove all hardware, chemicals, and equipment used in the manufacturing and synthesis of germane and related gases.
As part of his punishment, Chief Judge Lynn accepted the parties’ plea agreement which included a five-year term of probation with a prohibition that during the term of probation, Tezock was not permitted to work in any capacity with germane gas or other specialty chemicals. Tezock was further prohibited from disclosing to any person or entity in any manner any proprietary, confidential, or trade secret information of Voltaix.
The case was investigated by the FBI. Assistant U.S. Attorneys J. Nicholas Bunch and Paul Yanowitch prosecuted.
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Lehigh Acres Convicted Felon Pleads Guilty to Gun and Drug CrimesRead the Press Release
Fort Myers, FL – United States Attorney A. Lee Bentley, III announces that James Thomas Bissell (32, Lehigh Acres) today pleaded guilty to possession with the intent to distribute cocaine, heroin, hydrocodone, marijuana, alprazolam and morphine, and possession of firearms as a convicted felon. The drug offenses are each punishable by a maximum penalty of 20 years in federal prison and the firearms offense is punishable by a maximum penalty of 10 years’ imprisonment.
According to the plea agreement, on October 23, 2015, Bissell sold cocaine and heroin to an undercover Lee County Sheriff’s detective at the defendant’s home in Lehigh Acres. On December 3, 2015, the Lee County Sheriff’s Office executed a search warrant at Bissell’s residence and recovered six types of controlled substances that he was holding for distribution, along with 34 firearms and cash. As a convicted felon, Bissell was prohibited from possessing the firearms, two of which had been previously reported stolen.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Lee County Sheriff’s Office. It is being prosecuted by Assistant United States Attorney David G. Lazarus.
Kansas Resident Sentenced to over Five Years in Prison for Transporting a Person with Intent to Engage in ProstitutionRead the Press Release
Council Bluffs, IA - On August 18, 2016, Jason Gregory Johnson, a 22-year old resident of Overland Park, Kansas, was sentenced by United States Senior District Court Judge Robert Pratt, to 63 months in prison for transporting a person with the intent to engage in prostitution announced United States Attorney Kevin E. VanderSchel. Judge Pratt also ordered Johnson to serve a term of 10 years of supervised release upon release from prison, and to pay a $100 special assessment.
The conviction resulted from an investigation that began on January 27, 2016, when the Omaha, Nebraska, Police Department was notified of a minor female being in the Omaha area committing acts of prostitution. On January 28, 2016, Omaha police along with the Federal Bureau of Investigation made contact with the female and learned that she had engaged in acts of prostitution in Kansas, Nebraska and Iowa. Johnson was identified as the person who was providing transportation to the minor between the three states in exchange for a portion of the profits earned by the minor.
The investigation was conducted by the Omaha Police Department, Council Bluffs Police Department and Federal Bureau of Investigation. The case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
Indianapolis man found guilty in federal court on drug, firearm and money laundering chargesRead the Press Release
Indianapolis - United States Attorney Josh J. Minkler, announced today the guilty verdict of an Indianapolis man on six counts related to armed drug dealing and money laundering. Daniel L. Stewart 33, was found guilty after a five day jury trial before U.S. District Judge William T. Lawrence.
“Much of the violence in Indianapolis is the result of armed drug dealing,” said Minkler. “Those who commit crimes using firearms and illegally possess them will face the harshest penalties available in federal court.”
Indianapolis Metropolitan Police officers stopped Stewart for a traffic violation on the City’s Northside in January, 2015. As a result of that stop, officers recovered a loaded 9mm handgun as well as heroin, methamphetamine and cocaine. Officers obtained a search warrant for Stewart’s apartment near Eagle Creek and recovered a kilogram (over 2 pounds) of heroin, two kilograms of cocaine, five firearms and over $487,000 in cash. The money was bundled in $1,000 and $10,000 increments in various locations at the apartment.
Stewart is not legally permitted to carry a firearm because he has four prior felony convictions for drug crimes dating back to 2002.
“I applaud the efforts of the US Attorney’s Office and our detectives on the successful prosecution of Mr. Stewart,” said IMPD Chief Troy Riggs. “Arresting and prosecuting armed narcotics traffickers continues to be a priority to the Indianapolis Metropolitan Police Department. We will continue our efforts target violent offenders terrorizing our community.”
“IRS Criminal Investigation, along with our federal, state and local partners, will continue to investigate and prosecute Mr. Stewart and other offenders to keep the communities in which we live a safer place,” said IRS Criminal Investigation Special Agent in Charge James Robnett. “IRS CI has the financial investigators and expertise that is critical to locating and following the money which is a key component of the Stewart conviction and keeping violence off our streets.”
This case was investigated by Internal Revenue Service and Indianapolis Metropolitan Police Department.
According to Assistant United States Attorneys Michelle P. Brady and Peter Blackett, who prosecuted this case for the government, Stewart faces a mandatory minimum sentence of life without parole at sentencing.
Stewart remains in the custody of the US Marshal Service. No sentencing date has been set.
Greenville Man Pleads Guilty and Nine Others Sentenced in Access Device Fraud ConspiracyRead the Press Release
Contact Person: Jeanne Howard (864) 282-2100
Columbia, South Carolina ---- Acting United States Attorney Beth Drake stated today that Dalvin Michael Davenport, Jr., age 23, of Greenville, South Carolina, pled guilty yesterday in federal court in Anderson, to conspiracy to commit access device fraud and money laundering, violations of Title 18, United States Code, Section 1029 and 1956. United States District Judge Timothy M. Cain, of Anderson accepted the plea and will impose sentence after he has reviewed the presentence report which will be prepared by the U.S. Probation Office.
Evidence presented at the change of plea hearing established that Davenport, along with other members of the conspiracy, recruited cashiers at various businesses to credit funds onto Green Dot, Visa and other prepaid cards without receiving payment. Immediately after obtaining the prepaid cards, members of the conspiracy activated and depleted the cards of the fraudulently loaded funds. In total, the conspiracy resulted in a loss of over $264,000.00, to several businesses in South Carolina and Georgia.
Other members of the conspiracy who previously entered guilty pleas and have been sentenced include the following: Vincenzo Mikkel Byers, age 26, of Greenville, South Carolina, sentenced to 36 months imprisonment; Cierra Andreous James, age 24, of Greenville, South Carolina, sentenced to 30 months imprisonment; Brandon Christopher Davis, age 26, of Simpsonville, South Carolina, sentenced to 30 months imprisonment; Tony Christopher Robinson, age 24, of Fountain Inn, South Carolina, sentenced to 18 months imprisonment; Davario Rashad Clinkscale, age 23, of Greenville, South Carolina, sentenced to 30 months imprisonment; Eric Ross Wilson, age 26, of Greenville, South Carolina, sentenced to 30 months imprisonment; Terrance Justin Davis, age 27, of Mauldin, South Carolina, sentenced to 21 months imprisonment; Quentin Nathaniel McClinton, age 25, of Greenville, South Carolina, sentenced to time served; and, Adam Isaiah Posley, age 21, of Greenville, South Carolina, sentenced to 3 years’ probation.
The case was investigated by agents of the FBI Upstate Gang Task Force and the U. S. Treasury Department, IRS Criminal Investigation Division. Assistant United States Attorney Jeanne Howard of the Greenville office handled the case.
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Georgia Real Estate Investor Pleads Guilty to Bid Rigging at Public Home Foreclosure AuctionsRead the Press Release
A Georgia real estate investor pleaded guilty today for his role in bid-rigging and bank fraud conspiracies in connection with public real estate foreclosure auctions in Georgia, the Justice Department announced today.
Otto Gogolin admitted that he agreed not to bid against other real estate investors at certain public real estate foreclosure auctions in an effort to subvert the competitive process. Additionally, according to court documents, Gogolin and his co-conspirators defrauded banks that owned the mortgage notes. Gogolin admitted to participating in the conspiracy in Forsyth County, Georgia, from July 2008 to December 2011.
According to court documents filed in this case in the U.S. District Court for the Northern District of Georgia, the conspirators artificially suppressed the prices of properties sold at certain public real estate foreclosure auctions by agreeing not to outbid one another and then made and received payoffs to each other. Among other methods, the conspirators allegedly held secret “second auctions” of properties they had obtained through rigged bids and then divided the auction proceeds that otherwise would have gone to pay off the mortgage and other secured debt holders and, in some cases, to the previous owner of the foreclosed home.
Including the charges filed against Gogolin, 23 defendants have been charged in connection with the department’s ongoing investigation into bid rigging and fraudulent schemes involving real estate foreclosure auctions in the Atlanta area, 21 of whom have either pleaded guilty or agreed to plead guilty. In addition to the cases filed in Georgia, the Antitrust Division has recently filed similar cases in Alabama, North Carolina and California. More than 100 defendants in total have been indicted or have pleaded guilty for rigging foreclosure auctions and lining their own pockets at the expense of banks and homeowners going through foreclosures.
These charges have been filed as a result of the ongoing investigation being conducted by the Antitrust Division’s Washington Criminal II Section, the FBI’s Atlanta Division and the U.S. Attorney’s Office of the Northern District of Georgia, in connection with the president’s Financial Fraud Enforcement Task Force. The president established the task force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ Offices and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants.
For more information about the task force, please visit www.StopFraud.gov. Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions should contact the Washington Criminal II Section of the Antitrust Division at 202-598-4000, call the Antitrust Division’s Citizen Complaint Center at 888-647-3258, or visit http://www.justice.gov/atr/report-violations.
Gogolin Information
Former Navy Employee and Defense Contractor Plead Guilty to Engaging in Kickback SchemeRead the Press Release
NEWS RELEASE SUMMARY – August 19, 2016
Assistant U.S. Attorneys Rebecca S. Kanter (619-546-7304) and Andrew Galvin (619-546-9721)
SAN DIEGO – A former Navy Facilities Engineering Command (“NAVFAC”) civilian employee and a defense contractor pleaded guilty yesterday to charges relating to their conspiracy to defraud the Navy by filing false claims related to government contracts. Bentley faces a maximum sentence of ten years in prison, while Cioe faces a maximum of five years.
Joseph Bentley, who was previously a civilian employee at NAVFAC Southwest, supervised crews that did roofing, welding, paving, fencing and other types of construction repair, and maintenance work for the Navy and U.S. Marine Corps. As part of his job duties, he was responsible for requesting and/or authorizing the purchase of materials, supplies and labor from local suppliers and contractors. One of the individuals he arranged for the Navy to contract with was Eugene Cioe, the owner of Alcem Fencing Company, which operated out of National City, California until May 2013, and the owner of Cioe Fencing Consultant and Material Sales after May 2013.
As detailed in Cioe’s plea agreement, Bentley and Cioe agreed that Bentley would recommend, authorize or otherwise arrange for Defendant to receive orders for purchases from the Navy in exchange for Cioe providing Bentley with a kickback – money in payment for codefendant Bentley’s assistance in directing business to Defendant. For example, as Cioe admitted to Magistrate Judge Jan Adler in court today, in June 2011, Bentley arranged for Alcem to receive over $7,000 for a job on Building 322 on Naval Base San Diego (“NBSD”) through a Napa Auto Parts purchase in exchange for a $1,500 payment to codefendant Bentley from Defendant’s company. After billing the Navy and receiving $7,151.64 in government funds for materials for Building 322 on NBSD, Cioe paid Bentley $1,500. In February 2013, codefendant Bentley arranged for Alcem to receive another job with the Navy in exchange for an illegal payment from Defendant to codefendant Bentley, specifically, Alcem cashier’s check number 664152 on February 12, 2013 for $5,000.
Both defendants admitted that the conduct continued into the following year, when Cioe presented false claims to the United States Navy for core-drilling work that was in fact performed by NAVFAC employees. Specifically, between May 14 and June 4, 2014, Bentley arranged for Cioe to receive two orders for material, labor and equipment to drill 48 holes and set fencing posts at the Naval Base Coronado (“NBC”). Cioe then invoiced the Navy $4,764 for the core-drilling project, and was paid by the Navy for the work. Both defendants admitted in court today that they knew that in truth, neither Cioe nor anyone working for Cioe Material Sales actually performed the work reflected on the invoices in exchange for the $4,764 in total payments; in fact, the work was performed by NAVFAC employees.
In addition to the false claims admitted to by both defendants, Bentley further admitted to using the Navy to purchase $3,545 in roofing materials, falsely claiming that they were for a roofing project on Building 618 on NBC, which Bentley then stole to install on his personal residence in Imperial Beach. Then, after Bentley became aware of the government’s investigation, he asked a co-conspirator who had installed the roof to give the investigators false information about the roofing order. Specifically, he told his co-conspirator to falsely tell the investigating agents that his (Bentley’s) father was still alive when the roof was installed and asked the co-conspirator to backdate a receipt for the demolition of the old roof by approximately six months. Both of these lies would have had the effect of creating false evidence that the roof was actually installed long before the ABC order for the NBC project, thus, providing Bentley a possible defense to the charge that the roofing materials on his father’s house were the same materials paid for by the Navy in January 2013.
U.S. Attorney Laura Duffy commented, “Our office will continue to prosecute government insiders and military contractors who abuse and corrupt the procurement process to line their own pockets. This case is an excellent example of the continued success our federal law enforcement agencies have had in rooting out corruption through their cooperative joint investigations.”
FBI Special Agent in Charge Eric S. Birnbaum stated, “The FBI will continue to work with our law enforcement partners to root out corrupt individuals who use their government positions and associations with the government for personal gain.”
The FBI encourages the public to report allegations of public corruption to the FBI public corruption hotline at telephone number (877) NO-BRIBE (662-7423).”
Bentley and Cioe will be sentenced by United States District Judge Jeffrey T. Miller on December 2, 2016 at 9:00 a.m.
DEFENDANTS
Case Number: 15CR0195-JM
Joseph H. Bentley
Age: 55
Imperial Beach, California
Eugene Cioe
Age: 59
El Cajon, California
CHARGES
Bentley: Counts 3 & 4: False, Fictitious and Fraudulent Claims (18 U.S.C. § 287). Count 5: Theft of Public Property (18 U.S.C. § 641)
Cioe: Count 1: Conspiracy to Make False, Fictitious and Fraudulent Claims (18 U.S.C. § 371).
MAXIMUM PENALTIES
False, Fictitious and Fraudulent Claims (18 U.S.C. § 287) – maximum 5 years’ prison, $250,000 fine, $100 mandatory special assessment, 3 years’ supervised release
Conspiracy to Make False, Fictitious and Fraudulent Claims (18 U.S.C. § 371) – maximum 5 years’ prison, $250,000 fine, $100 mandatory special assessment, 3 years’ supervised release
Theft of Public Property (18 U.S.C. § 641) – maximum 10 years’ prison, $250,000 fine, $100 mandatory special assessment, 3 years’ supervised release
INVESTIGATING AGENCIES
Defense Criminal Investigative Service
Federal Bureau of Investigation
Internal Revenue Service, Criminal Investigations
Naval Criminal Investigative Service
Former Manager of Louisville Medical Office Sentenced to 20 Months in Prison for Health Care Fraud and Identity TheftRead the Press Release
LOUISVILLE, Ky. – United States Attorney John E. Kuhn, Jr. today announced the sentencing of a former medical office manager to 20 months in prison, on Wednesday, August 19, 2016, by Senior District Judge Thomas B. Russell, for committing health care fraud and aggravated identity theft.Kelly Lenning, age 45, of Jefferson County, Kentucky, pleaded guilty to all charges in a six count federal indictment, on March 28, 2016. Lenning admitted to scheming to defraud a health care benefit program, in connection with the delivery of and payment for health care benefits, items, and services, and three counts of aggravated identity theft in relation to the health care fraud offenses.
Specifically, from May of 2013 through August of 2013, while manager of Injury Rehab Specialists of Lou., PLLC a medical practice that treated motor-vehicle-accident patients, Lenning unlawfully used former employees’ (nurse practitioners) DEA numbers to order controlled substance prescriptions, namely Hydrocodone, and directed two individuals to fill the Hydrocodone prescriptions.
The individuals provided the filled Hydrocodone prescriptions to Lenning, for her own personal use, while she knew the individuals used Humana insurance, to pay for the unlawful prescriptions.
Additionally, during the same time period, Lenning admits to using the identification of another person, namely the DEA numbers of two nurse practitioners, without lawful authority. Lenning admitted that she did not have the authority or permission of the nurse practitioners to use their DEA numbers to order narcotics.
This case is being prosecuted by Assistant United States Attorneys Joseph Ansari and Lettricea Jefferson-Webb and was investigated by the Federal Bureau of Investigation (FBI) and Louisville Metro Police Department.
Former Louisville Business Owner Charged with Failure to File Income Tax Returns and Tax EvasionRead the Press Release
LOUISVILLE, Ky. – United States Attorney John E. Kuhn, Jr. today announced the indictment this week, of former Louisville business owner Lawrence P. Tatem, for willful failure to file federal income tax returns during a four-year period and evasion of payment of taxes, penalties, and assessments totaling $533,498 from a two-year period.
According to the indictment, Tatem, 50, willfully attempted to evade and defeat the payment of a large part of the federal income tax, penalties, and interest due by him to the United States of America, for the calendar years 2002 through 2004, totaling approximately $533,498, by concealing his assets; by changing the names and locations of his rehabilitation businesses; by placing his businesses in the names of nominees J.S., D.R., and M.Z.; by closing bank accounts at Republic Bank after the Internal Revenue Service attempted to levy funds from the accounts, and opening new bank accounts at Chase Bank under different names; and by operating in cash without keeping proper records of cash transactions.
Further, Tatem is charged with willful failure to file federal income tax returns for calendar years 2010 to 2013. Specifically, during the calendar year 2010, Tatem received gross income of approximately $252,860 and failed to file a federal tax return by April 15, 2011. During calendar year 2011, Tatem received gross income of approximately $45,353 and failed to file a federal tax return by April 15, 2012. During calendar year 2012, Tatem received gross income of approximately $199,067 and failed to file a federal income tax return by April 15, 2013. During the calendar year 2013, Tatem received gross income of approximately $120,994 and failed to file a federal income tax return by April 15, 2014.
If convicted at trial, Tatem could be sentenced to no more than nine years in prison, fined up to $225,000, and serve up to three years of supervised release.
This case is being prosecuted by Assistant United States Attorney Amanda Gregory and is being investigated by the Internal Revenue Service Criminal Investigation Division. tatem_lawerence_charged_8-18-16.pdf
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The charge of a person by Federal Indictment is an accusation only and that person is presumed innocent until and unless proven guilty
Former Licensed Physician Pleads Guilty to Defrauding Medicare of More Than $1 MillionRead the Press Release
Orlando, Florida – United States Attorney A. Lee Bentley, III announces that John Peter Christensen (64, West Palm Beach) has pleaded guilty to conspiracy to commit healthcare fraud. He faces a maximum penalty of five years in federal prison. A sentencing date has been set for November 21, 2016.
According to the plea agreement, Christensen was a licensed medical doctor in the State of Florida who practiced medicine in Palm Beach County and elsewhere in Florida. Christensen was also an enrolled Medicare provider and had a provider identification number that allowed him to submit reimbursement claims to Medicare for services that he provided to Medicare eligible patients. At some point between 2006 and 2011, Christensen authorized a chiropractor who operated a clinic in Volusia County, Florida, to use his name and Medicare provider number to submit false and fraudulent reimbursement claims to Medicare. As a result, Christensen caused over $1 million in loss to the Medicare program. Christensen used some of this fraudulently obtained money for personal expenditures, including an investment in a company and a payment towards the purchase of a Mercedes Benz vehicle.
This case was investigated by the Federal Bureau of Investigation, the Food and Drug Administration, Office of Criminal Investigations, and the U.S. Department of Health and Human Services - Office of the Inspector General. It is being prosecuted by Assistant United States Attorneys Andrew C. Searle and Shawn P. Napier.
Former Letter Carrier Sentenced in Federal CourtRead the Press Release
United States Attorney Kenyen R. Brown of the Southern District of Alabama announced that George Steven Gray, 27, of Daphne, Alabama, was sentenced in federal court on August 18, 2016, for discarding mail he was supposed to deliver. Court documents reflect that batches of undelivered and unopened mail were recovered from a dumpster and a recycling bin in Fairhope during late November and early December of 2015. An investigation conducted by the United States Postal Service Office of Inspector General revealed that Gray, a letter carrier delivering mail in the Fairhope area, had discarded undelivered mail on two occasions during that time frame. The discarded mail was recovered and delivered.
Gray pled guilty to one count of discarding mail in March of 2016. United States District Court Judge William H. Steele pronounced the sentence, ordering the Gray serve a probationary term of two years. Gray will pay a $100 special mandatory assessment but no fine was imposed.
The case was investigated by the United States Postal Service Office of Inspector General. It was prosecuted in the United States Attorney’s Office by Assistant United States Attorney Gloria Bedwell.
Former Fresno Business CFO Found Guilty of Embezzlement and Money LaunderingRead the Press Release
FRESNO, Calif. — After a four-day trial, a federal jury found Anthony Lester, 52, of Fresno, guilty today of two counts of mail fraud and five counts of money laundering in connection with his embezzlement of $300,000 from a Fresno business, Acting U.S. Attorney Phillip A. Talbert announced.
According to evidence at trial, between August 2010 and January 2012, Lester embezzled and stole money from his former employer. While an employee at Century Builders and Highlands Energy Services (the Companies) he held supervising positions in the accounting department, including Chief Financial Officer. In those capacities, Lester had responsibilities regarding management of the Companies’ finances and financial transactions and had access to and control over some of the Companies’ checking accounts and credit cards. Lester used this access to defraud the Companies.
According to court documents, Lester transferred money from one of the Companies’ checking accounts into what purported to be the Companies’ PayPal account. Then he transferred the money to one of his own personal PayPal accounts. Additionally, he transferred money from two of the Companies’ credit cards to his personal PayPal account. Thereafter, he attempted launder the proceeds of his fraudulent scheme and conceal his embezzlement by transferring money from his personal PayPal account to his personal bank accounts. None of these transactions were authorized by the Companies, and none were for legitimate business purposes of the Companies. In total, Lester embezzled approximately $300,000 from his former employer.
This case is the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and the Fresno Police Department. Assistant United States Attorneys Patrick R. Delahunty and Patrick J. Suter are prosecuting the case.
“Financial crimes like this don’t just line the pockets of ethically challenged businessmen, they also pose a threat to the continuing growth and vitality of our economy,” said Acting U.S. Attorney Talbert. “We are particularly grateful for the tenacious work of our law enforcement partners in Homeland Security Investigations and the Fresno Police Department in cutting through the defendant’s elaborate efforts to conceal this complex white collar fraud.”
“The greed of lawbreakers like this can negatively impact many people and cause local businesses to suffer unrecoverable losses of money, jobs and more,” said Ryan L. Spradlin, special agent in charge of HSI San Francisco. “HSI will continue to work closely with our law enforcement partners in targeting these devious criminals.”
Lester is scheduled to be sentenced by U.S. District Judge Dale A. Drozd on November 14, 2016. Lester faces a maximum statutory penalty of 20 years in prison and a $250,000 fine for mail fraud and a maximum penalty of 20 years in prison and a $500,000 fine for money laundering (or twice the value of the property involved, whichever is greater). The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
Former El Dorado Hills Man Sentenced for Scheme that Misappropriated Millions of Dollars of Workers’ Compensation FundsRead the Press Release
SACRAMENTO, Calif. — Gregory J. Chmielewski, 46, of West Bend, Wisconsin, was sentenced today by U.S. District Judge Garland E. Burrell Jr. to three years and five months in prison for mail fraud in connection with his misappropriation of funds from his insurance business into his own personal accounts for his personal use, Acting U.S. Attorney Phillip A. Talbert announced.
According to court documents, between September 2003 and September 2007, Chmielewski defrauded his clients and their employees in a workers’ compensation coverage scheme. During this time period, Chmielewski set up a professional employer organization called Independent Management Resources (IMR), later operating under the name Management Resources Group (MRG), which he operated from Healdsburg until relocating to Roseville in 2006.
He solicited an Indian tribe to partner with him to provide employee insurance coverage and other employee services at a reduced cost. Chmielewski marketed the insurance coverage to California employers as a low-cost alternative to workers’ compensation coverage, and he claimed that it was modeled after the California workers’ compensation statutes except that claims were made and adjudicated under the Tribe’s sovereign system. Because of the low rates, Chmielewski was successful in obtaining employers as clients.
Chmielewski diverted and misappropriated millions of dollars from MRG accounts for his personal use. He caused over $7.3 million to be paid out of MRG’s accounts to other unrelated companies that he controlled. Eventually, the company experienced serious cash flow problems and was forced to cease operations, leaving approximately 117 injured workers with approximately $1.8 million in unpaid claims.
Acting U.S. Attorney Talbert stated: “Many of the victims harmed in this scheme were companies in California’s construction industry, whose employees worked as roofers, general laborers, and other jobs where injuries can occur. The defendant’s actions left many injured workers without the benefits they expected and deserved. Our office is committed to prosecuting large-scale schemes such as this that hurt employers and workers alike.”
“While Chmielewski lined his pockets with the money he stole from California employers, he left injured workers without the workers’ compensation benefits and medical treatment they needed and deserved,” said Insurance Commissioner Dave Jones. “Thanks to the hard work of our investigators at the Department of Insurance and our law enforcement partners in the U.S. Attorney’s Office, Chmielewski’s crimes were exposed, and he has been brought to justice.”
“The license to operate a business is not a license to steal from those whom you are hired to protect,” said Cindy S. Chen, Acting Special Agent in Charge, IRS Criminal Investigation. “The misconduct of Chmielewski harmed those that needed his help during a time they were very vulnerable. Today’s sentence demonstrates IRS Criminal Investigation’s determination to combat financial fraud in all types of schemes.”
San Francisco Inspector in Charge Rafael Nunez of the U.S. Postal Inspection Service stated, “Postal Inspectors worked closely with the U.S. Attorney’s Office and our partners in law enforcement on this investigation and will continue to vigorously protect the public against complex fraud schemes and the criminal misuse of the U.S. Mail.”
This case was the product of an investigation by the United States Postal Inspection Service; the Internal Revenue Service, Criminal Investigation; and the California Department of Insurance. Assistant U.S. Attorneys Heiko P. Coppola and André Espinosa prosecuted the case.
Former Belleville Resident Pleads Guilty to Receipt of Child Pornography and Possession of Prepubescent Child PornographyRead the Press Release
Donald S. Boyce, United States Attorney for the Southern District of Illinois, announced today that Eric M. Swancutt, 38, formerly of Belleville, IL, pled guilty to a three-count Superseding Indictment charging him with two counts of Receipt of Child Pornography (Counts 1 and 2) and one count of Possession of Prepubescent Child Pornography (Count 3). On Counts 1 and 2, Swancutt faces a term of imprisonment of not less than five (5) but not more than twenty (20) years, a fine up to $250,000, and a term of supervised release of five (5) years to life. On Count 3, Swancutt faces a term of imprisonment of not more than twenty (20) years, a fine up to $250,000, and a term of supervised release of five (5) years to life. Swancutt has been detained since his arraignment on June 24, 2016. His sentencing date is January 27, 2017, in East St. Louis, Illinois.
A forensic review of a laptop computer seized from Swancutt’s residence discovered images and/or video files of child pornography, many of which were of prepubescent children. Swancutt provided a voluntary statement in which he admitted accessing and viewing child pornography.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in 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."
The case was investigated by the Belleville Police Department and the FBI’s Springfield Child Exploitation Task Force. The case is assigned to Assistant United States Attorney Angela Scott.
Five Indiana/Kentucky/Ohio Regional Council of Carpenters Union Members ChargedRead the Press Release
HAMMOND – United States Attorney for the Northern District of Indiana, David A. Capp, announced that five members of the Indiana/Kentucky/Ohio Regional Council of Carpenters were each charged by Information with one count of health care theft.
According to the documents filed in this case, members of the Indiana/Kentucky/Ohio Regional Council of Carpenters illegally gained assets from the Indiana/Kentucky/Ohio Regional Council of Carpenters Welfare Fund, a union health care benefit program. The defendants requested reimbursement of medical expenses by submitting to the carpenter’s welfare fund a fraudulent claim form and a copy of an un-negotiated personal check for reimbursement. These documents gave the appearance that the defendants had paid a reimbursable health care expense. Claims were processed from the union welfare fund reimbursing the defendants for these health care expenses that were never actually incurred. Those who have been charged are as follows:
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Bradley Crostreet, 45, of Valparaiso, Indiana amount reimbursed $10,310.83
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Dennis Gardner, 52, of LaPorte, Indiana amount reimbursed $15,000
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Robert Gutierrez, 38, of Hammond, Indiana amount reimbursed $19,771
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Aaron Vaughan, 35, of Lake Station, Indiana amount reimbursed $13,000
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Joshua Westfall, 38, of LaPorte, Indiana amount reimbursed $ 6,380
This case was investigated by the United States Department of Labor, Office of the Inspector General and the Employee Benefits Security Administration. As the investigation continues, we hope to charge others and issue a future press release. This case was handled by Assistant United States Attorney Gary T. Bell.
The United States Attorney's Office emphasized that an Information is merely an allegation and that all persons charged are presumed innocent until and unless proven guilty in court.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines. # # #
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Federal, State Settlement with Haverhill will Address Pollution of Merrimack RiverRead the Press Release
BOSTON – The City of Haverhill entered into a Consent Decree today with federal and state enforcement authorities agreeing to pay a $125,000 civil penalty and to take critical remedial measures to address pollution the City discharged into the Merrimack and Little Rivers.
The Consent Decree is the result of an enforcement action brought by the U.S. Department of Justice, on behalf of the U.S. Environmental Protection Agency (EPA), and the Massachusetts Attorney General’s Office, on behalf of the Massachusetts Department of Environmental Protection (MassDEP). The complaints filed simultaneously with the Consent Decree allege that Haverhill discharged pollutants into its storm water drainage system in violation of its permits and failed to properly operate and maintain its sewer system and treatment plant.
“By entering into this Consent Decree, Haverhill will take the steps necessary to prevent pollutants from entering the Merrimack River and its tributaries,” said United States Attorney Carmen M. Ortiz. “Haverhill is required to eliminate the flow of pollutants which will result in cleaner discharges and a healthier environmental for all.”
“We are pleased that, through this settlement, steps will be taken to better protect to the Merrimack and Little Rivers,” said Massachusetts Attorney General Maura Healey. “We will continue to work together at all levels of government to protect our natural resources and our residents.”
“This settlement ensures that Haverhill will continue the important work to eliminate unauthorized discharges of pollutants to the Merrimack River. This is a necessary step toward opening this valuable resource to more recreational use by people who live in the area,” said Curt Spalding, Regional Administrator of EPA’s New England office.
“The commitments made in this consent decree will result in significant water quality improvements in the Merrimack River watershed,” said MassDEP Commissioner Martin Suuberg. “Massachusetts is committed to improving water quality and will continue to work with cities and towns on this important issue.”
The complaints allege that from as early as 2008, Haverhill discharged pollutants from its combined sewer system on 190 occasions during dry and wet weather. The City continues to discharge untreated storm water containing sewage and other pollutants from its storm water and its combined sewer systems into these waters.
The Consent Decree requires the City to undertake a comprehensive inspection of its outfalls during the dry and wet weather and submit a report to the EPA of its combined sewer system and storm water outfalls. It requires the City to continue with electronic monitoring of its combined sewer outfalls for a one year, as well as to maintain electronic monitoring permanently on some of the more problematic outfalls. When pollutants are found, the City must eliminate the flows conveying the pollutants. In addition, the City must take action to control runoff from land redevelopment projects.
The Consent Decree also assesses a $125,000 civil penalty against the City for its Clean Water Act violations. Haverhill is subject to vigorous reporting requirements to ensure compliance with the terms of the Consent Decree. If it fails to comply, it may be subject to additional penalties as high as $2,500 per each day of violation.
Preventing pollutants from contaminating surface waters of the United States is one of the EPA’s National Enforcement Initiatives. Municipal wastewater presents significant health threats to those using contaminated waters for recreational use.
The Consent Decree is subject to a 30-day public comment period and approval by the federal court. Once it is published in the Federal Register, a copy of the Consent Decree will be available on the Justice Department website at http://www.justice.gov/enrd/Consent_Decrees.html.
U.S. Attorney Ortiz, Attorney General Healey, EPA Regional Administrator Spalding, and Department of Environmental Protection Commissioner Suuberg, made the announcement today. The case is being handled by Assistant U.S. Attorney Susan M. Poswistilo of Ortiz’s Civil Division and Assistant Attorney General Andrew Goldberg of Healey’s Environmental Protection Division.
Federal Law Enforcement Leaders to Hold Community Open House August 23 at Old Town PavilionRead the Press Release
POCATELLO – U.S. Marshal Brian Underwood and U.S. Attorney Wendy Olson will hold a community open house meeting Tuesday, August 23, at the Old Town Pavilion in Pocatello. Underwood and Olson will be at the Old Town Pavilion, 420 N. Main, from 5 – 6 p.m. to meet and visit with persons interested in learning more about federal law enforcement in Idaho.
“We will be available for any question, concern or issue community members would like to talk about,” said Olson. “Frankly, we simply want members of the public, whom we serve, to have a chance to personally visit with their federal law enforcement leaders in Idaho. We recognize that it is not always practical for people to come to our offices.”
“Confidence in government and the enforcement of law is achieved by providing true justice and being sincere in our working relationships with all people,” said Underwood. “In Idaho, the work of our local law enforcement is really amazing to see – and we are proud to work with such great professionals and police leadership. Like our local law enforcement partners, we want to ensure that we are doing our part in community policing and relationship building.”
Underwood and Olson were both appointed to their positions in 2010 by the President. They serve the entire state of Idaho, which is a single federal judicial district. Underwood and Olson also are both graduates of Pocatello High School.
Federal Court Orders Florida Tax Return Preparer to Stop Preparing Federal Tax Returns for OthersRead the Press Release
Return Preparer Allegedly Claimed Fraudulent Education and Fuel Credits
Today a federal court in Miami, Florida, permanently enjoined Rose M. Chazulle and her company, RMC Professional Services Corporation, from preparing federal tax returns for others. The defendants agreed to the civil injunction orders entered against them. In addition to barring the defendants from preparing, filing, or assisting in the preparation or filing of federal tax returns and amended returns, the court ordered the defendants to deliver a copy of the injunction to all of their customers since Jan. 1, 2010.
According to the complaint, the defendants prepared federal income tax returns for customers that falsely claimed:
- Refundable credits, including American Opportunity Tax Credit and Lifetime Learning Credit for customers who did not incur educational costs and otherwise did not qualify for these credits;
- Fuel tax credits for customers who had no businesses of any kind, even though the credit can only be taken when fuel is used for certain business purposes or to operate a school bus;
- Fabricated business losses, claimed on Schedule C, Profit or Loss from Business, even though the customers did not have a business; and
- Wages described as household help income in order to falsely claim an Earned Income Tax Credit or to create a larger refund than the customer otherwise would have been able to claim.
Return preparer fraud is one of the Internal Revenue Service’s (IRS) Dirty Dozen Tax Scams for 2016. The IRS has some tips on their website for choosing a tax preparer, and has launched a free directory of federal tax preparers. In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Ex-Auburn, Georgia, Police Officer Pleads Guilty to Extortion and Drug Trafficking ChargesRead the Press Release
ATLANTA - Charles F. Hubbard has pleaded guilty to extortion and drug trafficking conspiracy charges. The defendant was an officer with the Auburn, Georgia, Police Department who used his law enforcement position and his patrol car to intercept and steal drugs and money.
“Hubbard assisted drug traffickers for his own financial gain,” said U. S. Attorney John Horn. “He used his position as a police officer to perpetrate his scheme while betraying his community and the honest law enforcement officers who serve honorably every day.”
“It is deeply disappointing when an officer betrays his oath.” said Jack Killorin, Director of the Atlanta-Carolinas High Intensity Drug Trafficking Area. “What should be heartening to the community is that a task force of Federal, State and local police responded by upholding theirs.”
According to U.S. Attorney Horn, the charges and other information presented in court: Hubbard, while an officer with the Auburn Police Department, conspired with at least five other people to steal money and transport drugs. For example, in January 2015, one of Hubbard’s conspirators ordered six kilograms of cocaine. Hubbard used his Auburn police vehicle to intercept the drugs. Afterward, federal court authorized wiretaps exposed Hubbard agreeing to conduct a traffic stop on an individual carrying drugs in exchange for a $5,000 payment.
Then, on April 4, 2016, wearing clothing identifying himself as a police officer, and using his official police vehicle, Hubbard seized the confidential source's money. Hubbard provided the confidential source with a receipt purporting to be from the “East Metro Drug Task Force,” a non-existent entity, so that the seizure would look official. Hubbard then released the confidential source and met with two conspirators to split the money. Hubbard was taken into custody and, upon searching his vehicle, law enforcement officers found additional unused blank property sheets in the name of the non-existent East Metro Task Force that Hubbard had manufactured.
Sentencing for Charles F. Hubbard, 51, of Loganville, Georgia, is scheduled for November 7, 2016, before U.S. District Judge Leigh Martin May.
This case is being investigated by the Drug Enforcement Administration, the Atlanta-Carolinas HIDTA, and the Georgia State Patrol.
Assistant United States Attorneys Elizabeth M. Hathaway and Vivek Kothari are prosecuting the case.
The U.S. Attorney’s Office in Atlanta recommends parents and children learn about the dangers of drugs at the following web site: www.justthinktwice.com.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Enforcer for Atlantic City “Dirty Block” Gang Sentenced to Life in Prison for Role in Heroin Trafficking ConspiracyRead the Press Release
CAMDEN, N.J. – An Atlantic City, New Jersey, man who was an enforcer and street level dealer for a gang that used threats, intimidation and violence to maintain control of the illegal drug trade in Atlantic City was sentenced today to life in prison, U.S. Attorney Paul J. Fishman announced.
Malik Derry, a/k/a “Lik,” 25, was previously convicted of conspiracy to distribute one kilogram or more of heroin, possessing and discharging firearms in furtherance of the conspiracy and using a communications device in furtherance of a drug trafficking crime. He was convicted after a six-week trial before U.S. District Judge Noel L. Hillman, who imposed the sentence today in Camden federal court.
According to documents filed in this case and the evidence presented at trial:
Malik Derry was an enforcer and a street level seller for “Dirty Block,” a/k/a “Crime Fam,” “3.6.6.12,” or “3.6,”, which was led by his brother Mykal Derry, a/k/a “Koose,” 36, of Atlantic City. The gang used force, gun violence and intimidation to control the lucrative drug trafficking area of the Stanley Holmes public housing complex, Brown’s Park and the surrounding area.
The evidence at trial showed that Malik Derry, Mykal Derry, enforcer Shaamel Spencer, 32, of Atlantic City, and other members of the gang routinely carried loaded handguns and engaged in at least eight drug related shootings between October 2010 and February 2013, including the shooting of a teenager on April 17, 2011, which left the teenager paralyzed.
Additional testimony established that Mykal Derry and Malik Derry planned and carried out the shooting murder of a rival drug dealer in Atlantic City on the evening of Feb. 10, 2013. Mykal Derry told members of his gang that he wanted them to “put him down” (referring to an order to shoot the rival dealer) when they saw him. Malik Derry shot the victim in the head from close range while riding a bicycle past him as the victim stood in front of an Atlantic City restaurant.
The murder weapon, a stolen .380 caliber semi-automatic handgun, was later recovered from the drop ceiling in an apartment located on Green Street in Atlantic City, which, at the time, was shared by Mykal Derry and his girlfriend, Kimberly Spellman, 34, of Egg Harbor Township, New Jersey. Atlantic City police detectives also found 18 “bricks” of heroin (approximately 900 individual packets of heroin) and drug packaging materials inside the apartment.
The evidence presented by the government at trial consisted of recordings of hundreds of telephone calls and text messages between Mykal Derry, Malik Derry, and over 19 other members of the gang, physical evidence including the recovery of twenty firearms, ballistics evidence from shooting scenes, crime scene evidence from eight different shooting scenes in Atlantic City, recovery of substantial quantities of heroin and drug packaging materials, approximately $40,000 in drug proceeds, the testimony of dozens of FBI agents and Atlantic City police detectives, ballistics experts, a narcotics expert, and two cooperating witnesses who had previously pleaded guilty to federal drug trafficking offenses.
In addition to the prison term, Judge Hillman sentenced Malik Derry to serve a term of 10 years of supervised release.
Mykal Derry was sentenced on Jan. 7, 2016 to life in prison. He was previously convicted at trial of conspiracy to distribute one kilogram or more of heroin, distributing heroin, maintaining a place for the purposes of storing and distributing heroin, possessing, brandishing and discharging firearms in furtherance of the drug conspiracy and using a communications device in furtherance of a drug trafficking crime.
U.S. Attorney Fishman credited special agents of the FBI’s Newark Division, Atlantic City Resident Agency, under the direction of Special Agent in Charge Timothy Gallagher; the Atlantic County Prosecutor’s Office, under the direction of Acting Prosecutor Diane M. Ruberton; the Atlantic City Police Department, under the direction of Chief Henry White; and the South Jersey Safe Streets Violent Incident and Gang (Safe Streets) Task Force, with the investigation leading to today’s sentencing.
He also thanked the N.J. State Police; the Atlantic County Sheriff’s Office; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Northfield Police Department; the Vineland Police Department; the Brigantine Police Department; and the Millville Police Department.
The government is represented by Assistant U.S. Attorneys Patrick Askin and Justin Danilewitz of the U.S. Attorney’s Office in Camden and Special Assistant U.S. Attorney Edmund Mallqui-Burgos of the Atlantic County Prosecutor’s Office.
Defense counsel: Joshua Markowitz Esq., Lawrenceville, New Jersey.
Ellisville, Missouri Woman Indicted on Bankruptcy Fraud ChargesRead the Press Release
St. Louis, MO – Julie A. Fish was indicted on charges involving a bankruptcy scheme and concealing assets.
According to the indictment, Fish filed for bankruptcy in February 2014. The indictment states that she understated the value of her home in Ellisville by listing the value as $145,000. The property sold for $289,900. Additionally, in her Schedule B, Personal Property declaration she understated or failed to list the value of clothing, furs and jewelry by several thousand dollars. Also, as part of her preparation for the bankruptcy filing, Fish delivered several items of valuable jewelry to a local jewelry store to be sold on consignment, which she failed to list on the Schedule B document.
Fish, Ellisville, MO, was indicted by a federal grand jury on July 27, on one felony count each of bankruptcy fraud, making false statements in bankruptcy and concealment of bankruptcy assets. She was arraigned in federal court this morning.
If convicted, each count of the indictment carries a maximum penalty of five 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.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
East Chicago Man Indicted on Murder and RICO ChargesRead the Press Release
HAMMOND – United States Attorney David A. Capp announced that a federal grand jury in Hammond returned a 9 count superseding indictment charging Luis Allen Perez a.k.a. “LA”, 26, of East Chicago, Indiana with murder in aid of racketeering activity & RICO conspiracy in addition with numerous other charges.
According to the indictment, Perez allegedly is a member of the Imperial Gangsters street gang and was involved in committing various acts in furtherance of the criminal enterprise. Perez is alleged to have killed Manuel Martinez in East Chicago, Indiana on or about June 17, 2016 for the purpose of maintaining or increasing position in the gang. During the June 17 killing Perez allegedly also attempted to murder another individual.
The United States Attorney's Office emphasized that an Indictment is merely an allegation and that all persons charged are presumed innocent until, and unless, proven guilty in court.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
This case is the result of the investigative efforts of the Bureau of Alcohol, Tobacco, Firearms and Explosives, the East Chicago Police Department, the Federal Bureau of Investigation, the Gary Police Department, the Hammond Police Department, the Lake County, Indiana, Sheriff’s Department and Lake County High Intensity Drug Trafficking Area officers and agents. The Lake County Prosecutor’s Office also has provided assistance. The case is being prosecuted by Assistant U.S. Attorneys David J. Nozick and Dean Lanter.
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Colombian Citizen Sentenced for his Participation in an International Money Laundering ConspiracyRead the Press Release
A Colombian citizen was sentenced to 30 months in prison, to be followed by two years of supervised release for his participation in an international money laundering conspiracy.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, and Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), made the announcement.
Juan Carlos Medina Cardenas, 46, previously pled guilty to one count of conspiracy to commit money laundering, in violation of Title 18, United States Code, Section 1956(h).
According to court documents, Medina was employed as a branch manager at a Colombian bank where his duties included handling customer accounts. In January 2009, Medina opened an account for co-defendant Leonardo Forero Ramirez, 59, [case number 1:13-20556] at the bank. The account could be used to receive and disburse funds through wire transfers, cash, or other withdrawals. The bank was authorized to receive funds in U.S. dollars, provided that they were properly documented and justified as being for legitimate business transactions.
Forero received approximately $1.2 million from IRS undercover accounts which he passed on to the people designated to receive it. Medina was involved in the receipt of approximately $338,000 from IRS undercover accounts in the United States to the bank in Colombia, and the conversion of the dollars into pesos and their withdrawal by Forero. Medina understood that the money transfers were falsely represented as payments for fictitious services in order to disguise their source and origin as proceeds from illegal drug trafficking.
Forero was sentenced on July 17, 2015 to 37 months in prison, to be followed by one year of supervised release for his participation in the scheme.
Mr. Ferrer commended the investigative efforts of IRS-CI. This case was prosecuted by Assistant U.S. Attorney Frank H. Tamen.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Colleyville, Texas, Businessman Arrested for Running Ponzi Oil and Gas Fraud SchemeRead the Press Release
FORT WORTH, Texas — A Colleyville, Texas, businessman, James VanBlaricum, who operated an oil and gas exploration company, was arrested Wednesday by U.S. Postal Inspectors on a federal criminal complaint charging him with mail fraud, announced U.S. Attorney John Parker of the Northern District of Texas.
VanBlaricum, 77, made his initial appearance in federal court yesterday before U.S. Magistrate Judge Hal R. Ray, who ordered that he remain in custody pending a detention hearing set for Tuesday, August 23, 2016, at 2:00 p.m.
According to the complaint, Signal Oil and Gas Company (SOG) was incorporated by VanBlaricum in 2000; he was the registered agent and sole incorporator. The Land Lease Program (LLP) was one of several oil and gas investment programs offered for purchase to SOG investors. Texas Energy Management and Texas Energy Mutual (TEM) are the names of SOG’s follow-on companies that VanBlaricum and other coconspirators began operating in 2008. SOG initially operated from an Airport Freeway address in Fort Worth, but in 2004, it also began receiving mail at a commercial mail receiving agency on Northwest Highway in Grapevine, Texas. The name on this mail box was changed in November 2010 to TEM.
The investigation began when the U.S. Postal Inspection Service was contacted by the Texas State Securities Board (TSSB) after it began receiving complaints about VanBlaricum related to various programs he promoted and misrepresentations made to them by SOG salespeople. One of the main complaints was lack of investment payments. In fact, an investigation disclosed that from January 21, 2006, through January 31, 2009, 53 victims of a mail fraud scheme involving SOG’s LLP were identified with investments totaling $2,633,090.
Each LLP prospectus reflected 1) an “assured” rate of return on an initial investment; 2) the “assured” rate of return ranged from nine to 15 percent of the amount invested; and 3) investors would receive a full refund of their initial investment amount after the three to five-year investment period. Some prospectuses provided Minimum Assured Income Schedules that reflected assured and estimated potential rates of return of five to 35 percent, and some prospectuses reflected potential, projected, or examples of the allocation of investor funds in 50 percent hard assets and 50 percent oil and gas exploration.
An analysis of the use of LLP investor funds SOG received showed that approximately $2 million of LLP investor funds were deposited into SOG Wells Fargo bank accounts along with comingled funds from other sources. The analysis further revealed that funds deposited into the Wells Fargo accounts had not been used for purposes described in prospectuses and appear to have been misused by SOG and VanBlaricum. In fact, more than one-half of investor funds went to employee payroll and day trading.
“Dividend” or investor payments included payments to older investors from programs that preceded LLP, and those “dividend” payments came from Wells Fargo accounts where deposits from newer investors were kept – highly indicative of a Ponzi scheme where older investors are paid with newer investor money. Many of the victims in VanBlaricum’s LLP program invested at the recommendation of several financial consultants.
A federal criminal complaint is a written statement of the essential facts of the offense charged, and must be made under oath before a magistrate judge. A defendant is entitled to the presumption of innocence until proven guilty. The U.S. Attorney’s office has 30 days to present the matter to a grand jury for indictment. The maximum statutory penalty for the charged offense, mail fraud, is 20 years in federal prison and a $250,000 fine.
The investigation is being led by the U.S. Postal Inspection Service with assistance from U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI). Assistant U.S. Attorney Douglas A. Allen is in charge of the prosecution.
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Cocaine Trafficker Sentenced to 262 Months in Federal PrisonRead the Press Release
DALLAS — A Garland, Texas, resident, Chester Brown, a/k/a “Baldy,” 41, was sentenced today by U.S. District Judge Sidney A. Fitzwater to serve a total of 262 months in federal prison on drug conspiracy convictions, announced U.S. Attorney John Parker of the Northern District of Texas.
Brown pleaded guilty in February 2016 to one count of conspiracy to distribute cocaine and one count of conspiracy to distribute cocaine base (crack cocaine). Judge Fitzwater sentenced him to 240 months on the cocaine conspiracy and 22 months on the crack cocaine conspiracy, to run consecutively.
Brown is one of the main defendants charged in a 20-defendant cocaine and crack cocaine distribution indictment returned in May 2015. Most of the defendants named in that indictment, including Brown, were arrested on May 26, 2015, in a joint operation led by the Dallas Police Department, Dallas County Sheriff’s Office and the Dallas FBI-Violent Gang Safe Streets Task Force.
According to documents filed in his case, on several occasions between January 2013 and May 2015, Brown possessed with the intent to distribute and distributed cocaine and crack cocaine. While the conspiracy was ongoing, in fact, he possessed with the intent to distribute and/or distributed 2,649 grams of cocaine and 451.5 grams of crack cocaine.
Of the 20 defendants indicted, 16 have pleaded guilty and seven of those have been sentenced. Charges against one defendant were dismissed, and three are set for trial in December 2016.
Assistant U.S. Attorney Phelesa Guy is prosecuting the case.
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California Woman Sentenced to 50 Months in Prison for Conspiring to Illegally Export Fighter Jet Engines and Unmanned Aerial Vehicle to ChinaRead the Press Release
Wenxia Man, aka Wency Man, 45, of San Diego, was sentenced today to 50 months in prison for conspiring to export and cause the export of fighter jet engines, an unmanned aerial vehicle – commonly known as a drone – and related technical data to the People’s Republic of China in violation of the Arms Export Control Act.
The sentence was announced by Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge Mark Selby of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI) in Miami and Special Agent in Charge John F. Khin of the Department of Defense’s Defense Criminal Investigative Service (DCIS).
On June 9, 2016, Man was convicted by a federal jury in the Southern District of Florida of one count of conspiring to export and cause the export of defense articles without the required license.
According to evidence presented at trial, between approximately March 2011 and June 2013, Man conspired with Xinsheng Zhang, who was located in China, to illegally acquire and export to China defense articles including: Pratt & Whitney F135-PW-100 engines used in the F-35 Joint Strike Fighter; Pratt & Whitney F119-PW-100 turbofan engines used in the F-22 Raptor fighter jet; General Electric F110-GE-132 engines designed for the F-16 fighter jet; the General Atomics MQ-9 Reaper/Predator B Unmanned Aerial Vehicle, capable of firing Hellfire Missiles; and technical data for each of these defense articles. During the course of the investigation, when talking to an undercover HSI agent, Man referred to Zhang as a “technology spy” who worked on behalf of the Chinese military to copy items obtained from other countries and stated that he was particularly interested in stealth technology.
HSI and DCIS investigated the case. Assistant U.S. Attorney Michael Walleisa of the Southern District of Florida and Trial Attorney Thea D. R. Kendler of the National Security Division’s Counterintelligence and Export Control Section prosecuted the case.
California Woman Sentenced to 50 Months in Prison for Conspiring to Illegally Export Fighter Jet Engines and Unmanned Aerial Vehicle to ChinaRead the Press Release
Wenxia Man, aka Wency Man, 45, of San Diego, was sentenced today to 50 months in prison for conspiring to export and cause the export of fighter jet engines, an unmanned aerial vehicle – commonly known as a drone – and related technical data to the People’s Republic of China in violation of the Arms Export Control Act.
The sentence was announced by U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Assistant Attorney General for National Security John P. Carlin, Special Agent in Charge Mark Selby of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI) in Miami and Special Agent in Charge John F. Khin of the Department of Defense’s Defense Criminal Investigative Service (DCIS).
On June 9, 2016, Man was convicted by a federal jury in the Southern District of Florida of one count of conspiring to export and cause the export of defense articles without the required license.
According to evidence presented at trial, between approximately March 2011 and June 2013, Man conspired with Xinsheng Zhang, who was located in China, to illegally acquire and export to China defense articles including: Pratt & Whitney F135-PW-100 engines used in the F-35 Joint Strike Fighter; Pratt & Whitney F119-PW-100 turbofan engines used in the F-22 Raptor fighter jet; General Electric F110-GE-132 engines designed for the F-16 fighter jet; the General Atomics MQ-9 Reaper/Predator B Unmanned Aerial Vehicle, capable of firing Hellfire Missiles; and technical data for each of these defense articles. During the course of the investigation, when talking to an undercover HSI agent, Man referred to Zhang as a “technology spy” who worked on behalf of the Chinese military to copy items obtained from other countries and stated that he was particularly interested in stealth technology.
HSI and DCIS investigated the case. Assistant U.S. Attorney Michael Walleisa of the Southern District of Florida and Trial Attorney Thea D. R. Kendler of the National Security Division’s Counterintelligence and Export Control Section prosecuted the case.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Businessman Convicted of Offering Millions of Dollars to Department of Defense Procurement OfficialRead the Press Release
ALEXANDRIA, Va. – Razak A. Dosunmu, 61, of Washington, D.C., was convicted yesterday by a federal jury on charges of offering illegal gratuities to a procurement official with the U.S. Department of Defense, Defense Logistics Agency (DLA) while Dosunmu was negotiating aviation fuel contracts with DLA worth over $1 billion.
Dosunmu was indicted on March 8. According to court records and evidence at trial, Dosunmu initially offered to purchase a house for the procurement official. In subsequent conversations, Dosunmu offered, among other things, $2 million to the procurement official.
Dosunmu faces a maximum penalty of two years in prison for each count of conviction when sentenced on November 18. 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.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after the verdict was accepted by U.S. District Judge Anthony J. Trenga. Assistant U.S. Attorney Jack Hanly and Special Assistant U.S. Attorney Edward P. Sullivan are prosecuting the case.
The case was jointly investigated by the FBI’s Washington Field Office and the Defense Criminal Investigative Service.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-54.
Buchanan County Deputy Honored for Drug-Trafficking Investigation; ICE Agent Honored for Phillipines Child Porn InvestigationRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a Buchanan County Sheriff’s Deputy and an agent for Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) have received the Guardian of Justice Award.
Deputy J.D. Roberts and Agent James D. Holdman were honored on Thursday, Aug. 18, 2016, during the 14th Annual LECC Training Seminar in Springfield, Mo.
J.D. Roberts
Roberts is a Buchanan County Drug Strike Force investigator and is assigned to the Drug Enforcement Administration as a task force officer. Roberts began a drug-trafficking investigation in 2010 that, over the course of five years, culminated in 151 defendants charged in nine separate federal indictments. To date, there have been three jury trial convictions and dozens of guilty pleas. Additionally, there are still active spin-off investigations and indictments expected this year.
Defendants were charged with participating in conspiracies to distribute methamphetamine, heroin, or other controlled substances and money laundering. Many were charged with various firearm offenses. Money judgments into the millions have been obtained and more will be obtained when the related cases are resolved. These investigations successfully dismantled at least three intertwined multi-jurisdictional drug-trafficking organizations, with three others at least disrupted via the pending charges.
The geographic scope of this investigation initially was limited to the Buchanan County area; however, Roberts worked with DEA partners and the federal Organized Crime Drug Enforcement Task Force to expand into a large area of northwest Missouri, parts of southern Iowa and Nebraska, the Kansas City metropolitan area and Kansas. Roberts also partnered with Midwest HIDTA, the FBI, the Kansas Bureau of Investigation and police departments in Kansas City, Mo., Independence, Mo., and Kansas City, Kan.
James D. Holdman
Holdman located a Craigslist advertisement for photography services in the Philippines in July 2012, and his suspicion that the advertiser was involved in producing child pornography launched an investigation into Kenneth Gaylord Stokes, a U.S. citizen and prior sex offender who resided in the Philippines. As a result of the investigation, Stokes pleaded guilty to a federal indictment that charged him with sexually abusing five separate child victims and was sentenced to 120 years in federal prison without parole.
Holdman exchanged e-mails with Stokes and traveled to the Philippines to meet in person at Stokes’ gated compound. Stokes told Holdman that he would help facilitate sexual liaisons with both his own wife and Filipino children. Stokes also expressed his desire for Holdman to impregnate his wife in hopes that he would later be able to use the child for sexual purposes. Stokes explained that his wife would not consent to having sex with Holdman and encouraged him to rape her.
Stokes bragged that he had taken thousands of images depicting child pornography, and indicated that people in other countries paid him to produce made-to-order child pornography. Stokes showed Holdman multiple images of child pornography on his laptop computer.
Holdman left the house and returned with local law enforcement officers to arrest Stokes, who was deported to the United States. Investigators seized Stokes’s computers and conducted a forensic examination. Investigators found thousands of pictures and video recordings depicting child pornography on Stokes’s computers, as well as a script for a movie depicting the sexual and physical abuse of a child.
Guardian of Justice Award
The annual Guardian of Justice Award recognizes a state or local officer as well as a federal agent for investigative excellence, selfless collaboration, tireless trial support, commendable diligence and professionalism, and noteworthy assistance to prosecution. The prestigious law enforcement award is presented by the U.S. Attorney’s Office each year during the law enforcement training conference.
Bowling Green, Kentucky, Substitute Teacher Sentenced to Ten Years in Prison for Possession and Distribution of Child PornographyRead the Press Release
Arrest part of an international undercover investigation by Toronto, Ontario police
BOWLING GREEN, Ky. – A substitute teacher, formerly employed by the Bowling Green (Kentucky) School system, was sentenced to ten years in prison and a lifetime of supervised release this week in United States District Court, by United States District Judge Greg N. Stivers, for possession and distribution of child pornography, announced United States Attorney John E. Kuhn, Jr.
Leon Lussier, of Bowling Green, Kentucky, was arrested by criminal complaint on September 1, 2015, and charged by grand jury indictment on September 16, 2016. He pleaded guilty to the charges in May of 2016.
In court today, Lussier admitted that on three occasions, from June 23, 2015, to July 21, 2015, he participated in video conferencing rooms (chat rooms) where he was a participant in streaming child pornography through his webcam which was shared with other users in the room.
According to the initial charges, the international investigation that led to Lussier’s arrest started in January 2015, when the Toronto, Ontario, Canada Police Service, Child Exploitation Section, received information regarding the investigation of a group of individuals involved in the sexual abuse of children, including the distribution of child pornography. On June 23, 2015, a Toronto Police Service Detective Constable logged into an undercover software account and observed a person with the username “I luv boys” was streaming child pornography videos by sharing his computer screen. The user streamed four videos containing child pornography. Further investigation led law enforcement to Lussier as the person with username “I luv boys.”
A search warrant of Lussier’s Bowling Green home resulted in the seizure of numerous computer media. A preview of an HP Pavilion by a Computer Forensics Agent revealed several videos containing child pornography. Several of the videos had been previously viewed in a chat room by an undercover officer. The videos were being live-streamed on a computer with an IP address assigned to Lussier.
In addition to the sentence, Lussier was ordered to pay $15,000 to victims and $50,000 in fines.
This case is being prosecuted by Assistant United States Attorney Jo E. Lawless. This case is being investigated by U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), Canadian authorities, Bowling Green Police Department and U.S. Marshals Service.
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."
Bank Robbery IndictmentRead the Press Release
United States Attorney Deborah Gilg announced that an indictment was unsealed charging Charles McSpadden, age 42 of Omaha, with bank robbery. The indictment alleges he took by force, violence and intimidation, approximately $5,376.00 of United States currency belonging to and in the care, custody, control, management and possession of U.S. Bank, 3225 South 42nd Street, Omaha, Nebraska on or about August 5, 2016. The maximum possible penalty if convicted is 20 years’ imprisonment, a $250,000 fine, a 3 year term of supervised release and a $100 special assessment.
This case was investigated by the Omaha Police Department and the Federal Bureau of Investigation.
Army Deserter Charged for Receiving Veteran Benefits Based on Fraudulent Service-Connected DisabilitiesRead the Press Release
ASHEVILLE, N.C. – U.S. Attorney Jill Westmoreland Rose announced today that Roy Lee Ross, Jr., a.k.a. Daniel Alfred Sullivan, Jr, 64, of Morganton, N.C., is facing multiple federal charges for defrauding the U.S. Department of Veterans Affairs (the VA) by receiving veteran benefits based on fraudulent service-connected disabilities.
Kim Lampkins, Special Agent in Charge of the Mid-Atlantic Field Office, Washington, D.C., of the U.S. Department of Veterans Affairs, Office of Inspector General (VA-OIG), joins U.S. Attorney Rose in making today’s announcement.
According to allegations contained in the federal indictment, Ross enlisted in the United States Army (the Army) in September 1973 under his true name. While in the Army, the defendant was stationed in the United States and in West Germany, but never served in Vietnam or Korea, was not in the Special Forces, and never sustained any service-connected injuries. The indictment alleges that while stationed in Hawaii in 1978, the defendant was determined to be Absent Without Leave (AWOL), and a “Deserter Verification” was issued for him. Ross was later apprehended and eventually requested to be discharged rather than undergo a court-martial. Ross’s official Department of Defense form known as “DD Form 214” or “Report of Separation,” indicates that the defendant was discharged “Under Conditions Other Than Honorable.”
According to allegations contained in the indictment, at least by June 2007, Ross began to falsely represent himself to the Charles George VA Medical Center (the VAMC) in Asheville, as a U.S. Army veteran named “Daniel Alfred Sullivan, Jr.” The indictment alleges that the defendant claimed that he had served in the Special Forces, that he had been wounded in combat, and that he had been honorably discharged from the Army. The indictment further alleges that Ross claimed he was suffering from nightmares caused by his wartime service and his combat-related injuries. As a result of his misrepresentations, in 2007, Ross was diagnosed with suffering from service related Post Traumatic Stress Disorder (PTSD) and began receiving health benefits from the VA.
The indictment alleges that in 2012, based on the PTSD diagnosis and other multiple false statements regarding his military service, including his fictitious injuries, honors and medals received, Ross filed for, and was granted, disability-based compensation at a rate of 60%, he was given a retroactive lump sum of $18,349 and began receiving a monthly tax-free compensation of $1,026. Then, in 2014, the defendant filed a second claim for “increased evaluation” seeking additional disability-based compensation. The indictment alleges that Ross, still using the name Sullivan, claimed he had been shot in the neck during combat, and that he was suffering from physical pain due to his service-connected injury. As a result of Ross’s false statements and accounts, his disability rating was increased, reflecting an increase in his monthly tax-free compensation to $1,743.48. Then in 2015, still falsely claiming to be Daniel Sullivan, the defendant filed a third claim for “increased evaluation,” claiming that he was suffering from cervical (neck) impairment and pain, due to his injuries while on active duty. The defendant was eventually granted his claim, and Ross received a $3,490.95 back payment award and his monthly disability payment was increased to $2,906.83.
The indictment alleges that in addition to his disability benefits, the defendant received approximately $57,000 in health care benefits from the VA, to which he was not lawfully entitled. The defendant also defrauded the VA’s Beneficiary Travel Program, after filing claims for mileage reimbursement in connection with his medical appointments. Lastly, the indictment alleges that Ross defrauded the Veterans Retraining Assistance Program (VRAP), by receiving $10,218.14 in VRAP payments. The VRAP program offers up to 12 months of training assistance at a VA-approved educational program and it is available to unemployed veterans who meet certain criteria.
“The actions of the defendant are contrary to the code of military conduct,” said U.S. Attorney Rose. “As alleged in the indictment, Ross received thousands of dollars in VA benefits based on lies and a fabricated military career. Ross allegedly conjured up stories about fighting in multiple wars and receiving the Purple Heart, a distinguished medal presented to our country’s bravest wounded in combat. Now, the scheme has been exposed and Ross, a disgraced deserter, must answer for his actions in a federal court.”
The federal criminal indictment charges Ross with one count of executing a scheme to defraud a health benefit organization (the VA), which carries a maximum penalty of 10 years in prison and a $250,000 fine; and two counts of making false statements in connection with the delivery of health care benefits by the VA, which carries a maximum penalty of five years in prison and a $250,000 fine. He is also charged with two counts of stealing from the VA, a charge that levies a potential maximum prison term of five years and a $250,000 fine, and one count of a making false claim for travel benefits from the VA, which carries a potential maximum prison term of five years and a $250,000 fine.
The charges contained in the indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
In making today’s announcement U.S. Attorney Rose thanked the VA-OIG for their investigation of the case. Assistant U.S. Attorney Richard Edwards of the U.S. Attorney’s Office in Asheville is in charge of the prosecution.
Armed Fugitive Arrested on Cape CodRead the Press Release
BOSTON – A Hyannis man who has been a fugitive since he was indicted in April 2016 was arrested yesterday in connection with drug trafficking charges.
Shaun Miller, 31, of Hyannis, Mass., was arrested yesterday in South Yarmouth, Mass. Miller was detained pending a detention hearing in U.S. District Court in Boston scheduled for Aug. 31, 2016. In April 2016, Miller was charged in an indictment with Denzel Chisholm, Brooke Cottel and others with possession of heroin with intent to distribute.
As alleged during the arraignment today, on Thursday, Aug. 18, 2016, law enforcement officers surrounded a residence in South Yarmouth where Miller was believed to be staying. Officers ordered Miller out of the residence and Miller, disguised as an elderly man, walked outside. Upon further investigation, officers determined that the “elderly man” was in fact Miller, and at that point, officers pulled off Miller’s realistic disguise and placed him under arrest. A subsequent search of the residence revealed two loaded weapons hidden in a laundry basket and nearly $30,000 in cash.
United States Attorney Carmen M. Ortiz; Mickey D. Leadingham, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives, Boston Field Division; Barnstable Police Chief Paul MacDonald; and Yarmouth Police Chief Frank Frederickson, made the announcement today. The federal case against Miller is being prosecuted by Assistant U.S. Attorney Eric Rosen of Ortiz’s Narcotics and Money Laundering Unit.
The details contained in the indictment are allegations. The defendant is presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
AgQuest Accountant Sentenced to 42 Months in Prison for Embezzling more than $1.7 MillionRead the Press Release
United States Attorney Andrew M. Luger announced the sentencing of DIANE MARIE EILER, 48, to 42 months in prison for stealing $1.7 million from her employer. EILER, who pleaded guilty to one count of wire fraud on April 15, 2016, was sentenced today before Senior U.S. District Judge Patrick J. Schiltz in U.S. District Court in Minneapolis, Minn.
“Eiler systematically abused the trust of her employer to steal more than $1.7 million,” said Assistant United States Attorney Joseph H. Thompson. “The sentence imposed today by the court demonstrates that financial crimes are taken seriously and that white collar criminals are subject to significant consequences for their illegal acts.”
According to the defendant’s guilty plea and documents filed in court, EILER was the Director of Accounting at AgQuest Financial Services, Inc., a financial services company based in Morgan, Minn., which offers loans and insurance to farmers and other agricultural producers. From 2007 through November 2015, EILER used her position to funnel money from AgQuest to her own personal bank accounts.
According to the defendant’s guilty plea, EILER stole company checks and wrote them out to herself, using the signature stamps of the company’s executives. She hid the theft by creating false entries in AgQuest’s ledger to disguise the payments as payments to AgQuest customers. In total, EILER wrote more than 250 checks to herself, which totaled more than $1.7 million. EILER gambled away almost all of the stolen money.
This case was prosecuted by Assistant U.S. Attorney Joseph H. Thompson.
This case is the result of an investigation conducted by the FBI.
Defendant Information:DIANE MARIE EILER, 48
Bird Island, Minn.Convicted:
• Wire fraud, 1 count
Sentenced:
• 42 months in prison
• 3 years supervised release
• $1,738,459 in restitution