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Thursday 7 July 2016
Retired Funeral Director Sentenced for Submitting Fraudulent Claims to the Veterans AdministrationRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051BUFFALO, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that Karen Schlager, 60, of Snyder, NY, who was convicted of submitting false and fraudulent claims to the Department of Veterans Affairs, was sentenced to one year probation, 80 hours community service, and a $5,000 fine by U.S. District Judge Lawrence J. Vilardo. The defendant was also ordered to pay restitution totaling $14,900 to the U.S. Department of Veterans Affairs.
Assistant U.S. Attorney MaryEllen Kresse, who handled the case, stated that the defendant, who was the funeral director at Schlager Funeral Home in Amherst, submitted claims to the VA seeking payment for death benefits, including transportation costs, burial services, and funeral costs, that she knew had not provided to veterans or their families. As a result of the defendant’s actions, the VA suffered a loss of approximately $13,800.
The sentencing is the culmination of an investigation on the part of Special Agents of the United States Veterans Administration, Office of Inspector General, Criminal Investigations Division, under the direction of Special Agent-in-Charge Jeffrey G. Hughes.Redwood City Resident Pleads Guilty to Defrauding Produce Vendors of Millions of Dollars Worth of Fruits and VegetablesRead the Press Release
SAN JOSE – Remon Issa Daniel pleaded guilty in federal court late yesterday to three counts of wire fraud for his scheme to defraud produce vendors, announced United States Attorney Brian J. Stretch and Federal Bureau of Investigation Special Agent in Charge John F. Bennett. The plea follows charges Daniel pretended to be employed by reputable produce companies and ordered loads of fruits and vegetables on credit, when he knew he did not have the funds to pay for the loads and had no intention of paying for them.
In pleading guilty, Daniel admitted that between 2014 and his arrest on February 25, 2016, he defrauded at least 38 different businesses of more than $1.5 million worth of fruits and vegetables. Daniel ordered produce primarily from companies in California, Arizona, and Texas, and usually claimed to be from Bay Produce, New San Jose Wholesale, or General Produce, each a genuine produce wholesaler in Northern California. In fact, Daniel had no association with any of these companies. Daniel admitted to sending some of the vendors a copy of a deposit slip as proof that he had made a payment for the product. Only after the vendor released the produce to Daniel did the vendor learn that the deposited check was returned for insufficient funds.
Daniel was indicted by a grand jury on March 10, 2016, on 14 counts of wire fraud, in violation of 18 U.S.C. § 1343. Pursuant to yesterday’s plea, Daniel has admitted he is guilty of three of the counts in the indictment and the remaining counts will be dismissed. He is currently being held in in the Santa Clara County Main Jail, pending sentencing, which is set for October 19, 2016, at 9:45 a.m., before the Honorable United States District Judge Lucy Koh. The maximum statutory penalty for a violation of 18 U.S.C. § 1343, is 20 years’ imprisonment and a fine of $250,000 or twice the gross gain or loss from the offense, plus restitution. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant U.S. Attorney Amber Rosen is prosecuting the case with the assistance of Susan Kreider, Yolanda Singletary, and Nina Williams. The prosecution is the result of an investigation by the Federal Bureau of Investigation.
Orangeville, Pennsylvania Man Charged with Distribution of Child PornographyRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that child pornography distribution charges were filed in U.S. District Court in Scranton against Cedrick Vaughn Perkins, age 20, of Orangeville, Pennsylvania.
According to U.S. Attorney Peter Smith, Perkins is charged in a Criminal Information with distributing child pornography over the internet between January and June 2015.
Along with the Information, a plea agreement was filed in which Perkins agrees to plead guilty to the child pornography distribution charge. The plea agreement is subject to the approval of the court.
The case was investigation by Homeland Security Investigations. The case is being prosecuted by Assistant United States Attorney Todd K. Hinkley.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law is 20 years of imprisonment, a term of supervised release following imprisonment, and a $250,000 fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Oklahoma City Woman Pleads Guilty to Committing Health Care Fraud and Food Stamp FraudRead the Press Release
Oklahoma City, Oklahoma – SHALONDA SUGGS, 36, of Oklahoma City, pled guilty last Thursday to health care fraud in connection with submitting false claims to Medicaid for behavioral health counseling services, announced Mark A. Yancey, Acting United States Attorney for the Western District of Oklahoma, and Scott Pruitt, Attorney General for the State of Oklahoma. Suggs also pled guilty to stealing Supplemental Nutrition Assistance Program benefits (SNAP benefits, formerly known as food stamps), which she wrongfully received based on her false statements regarding her income.
On April 5, 2016, Suggs was indicted on sixteen counts of health care fraud and one count of theft of government funds. The Indictment alleged that in July 2013, Suggs opened a behavioral health counseling agency called Focus Pointe Counseling, LLC. It is alleged Suggs obtained a contract with the Oklahoma Health Care Authority (OHCA), which allowed Focus Pointe to receive reimbursement from Medicaid for providing behavioral health counseling services to Medicaid-eligible children. It was alleged that Suggs then submitted Medicaid claims for behavioral health counseling services that were purportedly provided by four counselors supposedly employed by Focus Pointe. It was alleged that the counselors were never actually employed by Focus Pointe and never provided any of the counseling services claimed by Focus Pointe. It was alleged that the OHCA paid Focus Pointe for the false claims and that Suggs used the proceeds for her personal benefit. It is further alleged that during the time period Suggs was fraudulently receiving funds from the OHCA, she was receiving SNAP benefits by making false statements to the Oklahoma Department of Human Services that she was unemployed and had a negligible source of income.
Last Thursday, Suggs admitted that on February 4, 2015, she used Focus Pointe Counseling to submit a claim to the OHCA using the name and Medicaid provider number of certain counselor for a behavioral counseling session that was supposedly provided to a Medicaid beneficiary on August 16, 2014. Suggs admitted that the counselor was not in fact employed by Focus Pointe and that the counseling session was not actually provided. She also admitted that from August 2014 through May 2015, she was receiving SNAP benefits that she obtained by making false statements about her lack of income.
As part of her plea, Suggs agreed to pay restitution to Medicaid in the amount of $204,334.24 and to the Supplemental Nutrition Assistance Program in the amount of $4,959.00.
At sentencing, Suggs faces up to 10 years in prison, three years of supervised release, and a $250,000 fine on each count. A sentencing date will be set by the court in approximately 90 days. Reference is made to the Indictment and other public filings for further information.
Medicaid and SNAP are programs that are funded and administered jointly by the federal government and the State of Oklahoma. This case is the result of a cooperative federal and state investigation by the Federal Bureau of Investigation, the Oklahoma Attorney General’s Office, and the United States Department of Agriculture, Office of Inspector General. It is being prosecuted by Assistant U.S. Attorney Amanda Maxfield Green and Oklahoma Assistant Attorney General Lory Dewey.
Ohio psychiatrist pleads guilty to not paying more than a half-million dollars in taxesRead the Press Release
A psychiatrist from Oregon, Ohio, pleaded guilty to tax evasion for not paying more than a half-million dollars in taxes, said Carole S. Rendon, Acting United States Attorney for the Northern District of Ohio, and Kathy Enstrom, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office.
Sandra Vonderembse, 65, pleaded guilty to attempting to evade taxation or the payment thereof from 2005 through 2013.
Vonderembse admitted that despite earning compensation in excess of $240,000 per year from 2009 through 2011 as a psychiatrist working for multiple businesses and the State of Ohio, she falsely claimed zero taxable income and zero tax owing for each of those years on federal tax returns. In tax years stretching back to 2005, Vonderembse failed to pay taxes due on her income and filed tax returns falsely claiming taxable income as “None.” From 2005 to 2011 she also had her earnings paid to nominee entities to conceal income from the IRS and sent fake financial instruments to the IRS in purported payment of her taxes, according to court documents.
Vonderembse faces a statutory maximum sentence of five years in prison. She has agreed to pay restitution to the IRS in the amount of $565,000.
The defendant’s sentence will be determined by the court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, and the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The investigating agency in this case is the Internal Revenue Service-Criminal Investigation in Toledo. The case is being handled by Assistant United States Attorney Noah P. Hood and Department of Justice Trial Attorneys Jack Morgan and Jeffrey McLellan.
Ohio Psychiatrist Pleads Guilty to Tax EvasionRead the Press Release
An Oregon, Ohio, psychiatrist pleaded guilty to tax evasion today in the U.S. District Court for the Northern District of Ohio, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division.
Sandra Vonderembse admitted that despite earning compensation in excess of $240,000 per year from 2009 through 2011 as a psychiatrist working for multiple businesses and the state of Ohio, she falsely claimed zero taxable income and zero tax owing for each of those years on federal tax returns. In tax years stretching back to 2005, Vonderembse failed to pay taxes due on her income and filed tax returns falsely claiming taxable income as “None.” From 2005 to 2011, she also had her earnings paid to nominee entities to conceal income from the Internal Revenue Service (IRS) and sent fake financial instruments to the IRS in purported payment of her taxes.
Vonderembse faces a statutory maximum sentence of five years in prison, as well as a term of supervised release. She has agreed to pay restitution to the IRS in the amount of $565,000.
Acting Assistant Attorney General Ciraolo commended special agents of IRS - Criminal Investigation, who investigated the case and Assistant U.S. Attorney Noah Hood and Trial Attorneys Jack Morgan and Jeffrey McLellan of the Justice Department’s Tax Division, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division website.
Norwich Resident Admits Role in Insurance Fraud SchemeRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that CARLINS CALIXTE, 32, of Norwich, pleaded guilty today before U.S. District Judge Jeffrey A. Meyer in New Haven to one count of conspiracy to commit mail and wire fraud stemming from his involvement in an insurance fraud scheme.
According to court documents and statements made in court, between April 2011 and February 2014, CALIXTE and others conspired to stage approximately 50 car crashes in southeastern Connecticut for the purpose of defrauding automobile insurance companies and enriching themselves. A high percentage of these planned crashes were single-vehicle accidents on remote roads where there were no witnesses other than the occupants of the crashed vehicle. After each staged accident, the defendants filed fraudulent property damage and bodily injury claims with various automobile insurance companies. They then collected payouts on the fraudulent claims from the victim insurance companies. These payouts typically ranged from about $10,000 to about $30,000 per accident.
In pleading guilty, CALIXTE admitted his personal involvement in at least seven staged crashes. After each crash, CALIXTE either filed a fraudulent property damage or bodily injury claim with his or another participant’s automobile insurance provider, or he aided and abetted other participants in their submission of fraudulent claims.
CALIXTE were arrested on May 23 and is released on bond. He is a citizen of Haiti and a lawful permanent resident of the U.S.
Judge Meyer scheduled sentencing for September 30, 2016, at which time CALIXTE faces a maximum term of imprisonment of 20 years.
This matter is being investigated by the Federal Bureau of Investigation, the Norwich Police Department and the National Insurance Crime Bureau, with the assistance of the Mohegan Tribal Police Department. The case is being prosecuted by Assistant U.S. Attorney Avi M. Perry.
Northwest Alabama Pharmacies Owner Agrees to Plead Guilty to Obstructing Medicare AuditRead the Press Release
BIRMINGHAM – The owner of two northwest Alabama pharmacies has agreed to plead guilty to obstructing a Medicare audit and to pay a $2.5 million penalty to the government.
U.S. Attorney Joyce White Vance, FBI Special Agent in Charge Roger C. Stanton, Health and Human Services Office of Inspector General Special Agent in Charge Derrick L. Jackson, and Food and Drug Administration Office of Criminal Investigation Special Agent in Charge Robert J. West announced the charge and plea agreement today.
The U.S. Attorney’s Office for the Northern District of Alabama charged RODNEY DALTON LOGAN, 63, of Muscle Shoals, with one count of obstructing a 2012 federal audit of Medicare claims submitted by a pharmacy he owned. Logan, a registered pharmacist, owned Leighton Pharmacy Inc., which did business as Sheffield Pharmacy and Homecare in Sheffield, and Russellville Pharmacy in Russellville. At various times, according to the charge, Logan was the lead pharmacist at both Sheffield and Russellville. Prosecutors filed the charge by information in U.S. District Court, along with a plea agreement reached between Logan and the government.
“This case revolves around the falsification of documents in an effort to defraud Medicare, which exists to provide health care services for the elderly,” Vance said. “My office and our law enforcement partners are committed to ensuring the integrity of government programs and to prosecuting those who would provide false information to criminally profit from those programs.”
“Fraud undermines the financial integrity of the Medicare system and combating health care fraud remains a top priority for the FBI,” Stanton said. “This should serve as a reminder to others that the FBI and its law enforcement partners will identify, investigate and present for prosecution those individuals involved in similar activities.”
"Obstructing a Medicare audit is something the OIG takes very seriously," Jackson said. "Submitting documentation to Medicare to substantiate that tablets or capsules were utilized when, in fact, bulk pharmaceutical powders were actually used is straight-up fraud."
The Sheffield and Russellville pharmacies operated as both compounding and retail pharmacies. A compounding pharmacy is one that prepares customized medications for individual patients, usually by mixing ingredients in order to create a prescription. The two pharmacies sold compounded prescriptions to patients in Alabama and other states.
According to the information and plea agreement, Logan obstructed a 2012 audit of the Sheffield pharmacy’s claims for Medicare reimbursement on compounded prescriptions as follows:
CVS/Caremark Inc. administered prescription drug claims for Medicare Part D and served as an auditor on Medicare’s behalf. Part D prohibited reimbursement to pharmacies for compounded medications made using bulk pharmaceutical powders. Russellville and Sheffield nonetheless sought Part D reimbursement after February 2009 for compounded medications, primarily topical pain creams, made from bulk powders. The pharmacies, however, used the billing code for the tablet or capsule form of the ingredient.
In response to the 2012 audit, Logan caused Sheffield to submit falsified and misleading documents stating that medications in tablet or capsule form were used as ingredients for the compounded prescriptions.
The maximum penalty for obstructing a federal audit is five years in prison and a fine of $250,000 or twice the amount improperly gained through the defendant’s conduct.
FBI, HHS-OIG and FDA-OCI investigated the case, which Assistant U.S. Attorney Chinelo Diké-Minor and Trial Attorney William Chang of the Justice Department’s Criminal Division Fraud Section are prosecuting.
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New Castle Man Sentenced to 77 Months in Prison for New Castle Bank RobberiesRead the Press Release
PITTSBURGH - A former resident of New Castle, Pennsylvania, has been sentenced in federal court to 77 months imprisonment, followed by three years supervised release, on charges of bank robbery. Calvin Douglas Smith was also ordered to pay restitution in the amount of $3,266.00, United States Attorney David J. Hickton announced today.
United States District Mark R. Hornak imposed the sentence on Calvin Douglas Smith, age 44, formerly of New Castle, Pennsylvania.
The court was advised that on Nov. 5, 2014, Smith robbed Huntington Bank located at 101 E. Washington St., New Castle, PA, and on Dec. 2, 2014, Smith robbed First Commonwealth Bank located at 27 E. Washington St., New Castle, PA. The banks are both insured by the Federal Deposit Insurance Corporation.
Assistant United States Attorney Cindy K. Chung prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Federal Bureau of Investigation and the New Castle City Police Department for conducting the investigation leading to the successful prosecution of Smith.
New Bedford Man Sentenced to 11 Years for Armed Bank RobberyRead the Press Release
BOSTON – A New Bedford man was sentenced yesterday in U.S. District Court in Boston for robbing the St. Anne’s Credit Union in New Bedford in September 2013.
David Frates, 36, was sentenced by U.S. District Court Judge Richard G. Stearns to 11 years in prison, five years of supervised release and restitution of $1,098. In May 2015, Frates pleaded guilty to armed bank robbery.
On the morning of Sept. 24, 2013, a man wearing a translucent mask and hooded sweatshirt entered the St. Anne’s Credit Union in New Bedford. Once inside the bank, the man brandished what appeared to be a black semi-automatic firearm, threatened the tellers, and ordered the tellers to give him cash. The man took $1,098 in cash and fled the bank.
A few days later, the New Bedford Police Department received an anonymous tip suggesting that David Frates was involved in the robbery. During an investigation, the clothing Frates was wearing and the weapon he carried were recovered. The weapon was determined to be a BB gun. Frates was arrested and charged in January 2014.
U.S. Attorney Carmen M. Ortiz; Harold H, Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and New Bedford Police Chief Joseph C. Correiro, made the announcement. The case was prosecuted by Assistant U.S. Attorney Kenneth G. Shine of Ortiz’s Major Crimes Unit.
Navajo Woman from Gallup Sentenced for Federal Involuntary Manslaughter ConvictionRead the Press Release
ALBUQUERQUE – Clara Beth Joe, 27, an enrolled member of the Navajo Nation who resides in Gallup, N.M., was sentenced this morning in Santa Fe, N.M., to 24 months in federal prison followed by three years of supervised release for her involuntary manslaughter conviction.
Joe was arrested on Aug. 27, 2014, on an indictment filed Aug. 12, 2014, charging her with involuntary manslaughter. The indictment alleged that Joe committed the crime on Jan. 30, 2014, on the Navajo Indian Reservation in San Juan County, N.M.
On Aug. 20, 2015, Joe pled guilty to the indictment and admitted that on Jan. 31, 2014, law enforcement officers found her, heavily intoxicated and suffering from hypothermia, near a creek in Crystal, N.M., on the Navajo Indian Reservation. After inquiries were made about the whereabouts of Joe’s 13-month-old son, the officers found the child, who had drowned, closed to the area where Joe had been found. Joe admitted that her intoxication an important contributing factor in her son’s death.
The Gallup office of the FBI and the Crownpoint office of the Navajo Nation Division of Public Safety investigated the case, which was prosecuted by Assistant U.S. Attorney Paul H. Spiers.
Montgomery County Woman Convicted of Social Security FraudRead the Press Release
HOUSTON – A 67-year-old Willis woman has admitted she stole the identity of a deceased woman and used it for financial gain for nearly 20 years, announced U.S. Attorney Kenneth Magidson.
Jerrie Mona Chesney pleaded guilty today to one count of theft of public money.
In the late 1980s, Chesney read in a local newspaper about the death of a woman who had lived in the Beaumont area. Chesney contacted woman’s family and was able to obtain her personal identification information under the guise that she was an old high school friend. However, Chesney had no prior knowledge this woman. Chesney also obtained additional personal information about the deceased woman from the local funeral home who handled the burial arrangements.
Chesney took the identifying information and obtained a Texas Driver’s License and a Social Security card using the deceased woman’s name as her own.
From approximately 1995 until 2014, Chesney obtained Social Security disability benefits and supplemental Social Security benefits utilizing the name of the deceased woman. She was also able to obtain Medicare benefits and food stamp benefits using the woman’s false identification information. As a result, she received approximately $388,000 in benefits from these programs.
U.S. District Judge Lee Rosenthal accepted the plea today and set sentencing for Oct. 16, 2016. At that time, Chesney faces up to five years in federal prison and a possible maximum fine of $250,000. She will remain on bond pending that hearing.
The Social Security Administration - Office of Inspector General investigated. Assistant U.S. Attorney Quincy L. Ollison is prosecuting the case.
Monroeville Man Sentenced to 12 Years in Prison for Distributing Child PornographyRead the Press Release
PITTSBURGH - A former resident of Allegheny County, Pennsylvania, has been sentenced in federal court to 151 months imprisonment, followed by a lifetime supervised release, on a charge of distribution of material depicting the sexual exploitation of a minor, United States Attorney David J. Hickton announced today.
United States District Judge Nora Barry Fischer imposed the sentence on Andrew Patterson, age 46, formerly of Monroeville, Pennsylvania.
According to information presented to the court, the court was advised that from on or about June 15, 2014, to on or about June 16, 2014, Patterson distributed videos and images containing material depicting the sexual exploitation of minors.
Assistant United States Attorney Jessica Lieber Smolar prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Federal Bureau of Investigation, the Indiana County District Attorney’s Office, the Allegheny County District Attorney’s Office, and the Monroeville Police Department for conducting the investigation leading to the successful prosecution of Patterson.
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.justice.gov/psc.
Miranda Brakley Was Sentenced to 2 Years ProbationRead the Press Release
HAMMOND – United States Attorney for the Northern District of Indiana, David A. Capp, announced that Miranda Brakley, 36, of Lake Station, Indiana was sentenced in Hammond Federal Court for one count theft of government funds.
Brakley was sentenced to 2 years probation which includes a 6 month term of home detention. Brakley was also ordered to make restitution to the City of Lake Station in the amount of $664.00.
According to documents filed in the case, while employed by the court, Brakley embezzled approximately $16,000 from the Lake Station City Court.
This case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service –Criminal Investigation Division, and resulted from an audit conducted by the Indiana State Board of Accounts. This case was handled by Assistant United States Attorney Philip C. Benson.
Mexican National Sentenced for Violation of the Federal Gun Control ActRead the Press Release
U.S. Attorney Kenneth A. Polite announced that OMAR RICO-ALMANZA, age 34, a citizen of Mexico, was sentenced today after previously pleading guilty a one-count Indictment for violations of the Federal Gun Control Act.
U.S. District Judge Carl J. Barbier sentenced RICO-ALMANZA to time served, to be followed by one year of supervised release, and a $100 special assessment. Additionally, RICO-ALMANZA will be surrendered to the custody of the U.S. Immigration and Custom Enforcement for removal proceedings.
U.S. Attorney Polite praised the work of the Homeland Security Investigations of the U.S. Department of Homeland Security, in investigating this matter. Assistant U.S. Attorney Spiro G. Latsis was in charge of the prosecution.
Merritt Island Man Convicted of Multiple Federal Child Pornography OffensesRead the Press Release
Orlando, Florida – U.S. District Judge Roy B. Dalton, Jr. has found Joshua Adam Tatro (24, Merritt Island) guilty of 9 counts of producing child pornography, 3 counts of receiving child pornography, and 1 count of possessing child pornography. He faces a mandatory minimum sentence of 15 years, up to 30 years, in federal prison for each of the production offenses. In addition, he faces a mandatory minimum sentence of 5 years, up to 20 years’ imprisonment, for each receipt offense, and up to 20 years in federal prison for the possession charge. A sentencing hearing is scheduled for October 3, 2016.
According to testimony and evidence presented at trial, on nine separate occasions between October 2014 and March 2015, Tatro produced images and videos depicting him sexually abusing a three year-old child. He also used a messaging app on his phone to send and receive images depicting child pornography, and he uploaded images of child pornography onto an online account that he maintained. Law enforcement began investigating Tatro after they learned of his online activity from the National Center for Missing and Exploited Children.
On March 17, 2015, agents from the Brevard County Sheriff’s Office executed a search warrant at Tatro’s residence, where he and the child victim were living. During the execution of the warrant, cellphones were recovered from Tatro’s pocket and his bedroom. A forensic examination of those phones led to the recovery of the explicit images and videos that Tatro had produced. During an interview with agents, Tatro admitted to producing the images and videos, and to sending them to others using the messenger app.
In total, Tatro possessed 76 videos and 692 photographs of child pornography on his cellphones. A search of his online drive account revealed more than 1,000 stored images of child pornography. Several of the images in Tatro’s possession depicted children under the age of 12 being sexually abused and exploited.
This case was investigated by the Brevard County Sheriff’s Office and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. It is being prosecuted by Assistant United States Attorney Andrew C. Searle.
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 United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Member of Brooklyn Street Gang Arrested and Charged with Racketeering, Double Homicide, Narcotics Trafficking and Unlawful Use of FirearmsRead the Press Release
A five-count indictment was unsealed today in United States District Court for the Eastern District of New York charging Frank Smith, a member of a Coney Island-based gang known variously as “Rival Impact,” “R.I.,” “Mermaids,” “Mermaid Boys,” and “33rd Street Crew,” with crimes including racketeering, murder in aid of racketeering, narcotics trafficking and unlawful use of firearms. The defendant was arraigned this afternoon before United States Magistrate Judge Lois Bloom at the federal courthouse in Brooklyn.
The charges were announced by Robert L. Capers, United States Attorney for the Eastern District of New York; Diego Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); and William J. Bratton, Commissioner, New York City Police Department (NYPD).
As detailed in the indictment, between January 2001 and October 2014, to maintain Rival Impact’s power and hold in the Coney Island section of Brooklyn, the defendant and his gang engaged in widespread narcotics distribution and violence, including the October 4, 2010 murders of Terrance Serrano and Rashawn Washington, in addition to various attempted murders, robberies, assaults and intimidation. Serrano and Washington, who were members of a rival gang known as “Thirty-O,” were shot and killed while sitting in their car after leaving a nightclub in Manhattan.
“As alleged, for years the defendant and other members of this violent Brooklyn street gang have plagued neighborhoods throughout Coney Island and elsewhere with drugs and violence. Today’s charges send the clear message that violence by and among street gangs will not be tolerated. We will use all available resources to hold accountable those who endanger the lives and well-being of the residents of our communities,” stated United States Attorney Capers.
“Street gangs have an impact on the communities in which they operate. They spread fear and violence so they can control their so called turf; and for them murder just comes with the territory. But the FBI and our law enforcement partners won’t accept any crime as a new normal, and we won’t stop pursuing gang members,” said FBI Assistant Director-in-Charge Rodriguez.
“We are hopeful that today’s indictment is a milestone along the path to this individual’s conviction,” said NYPD Commissioner Bratton. “The defendant, as alleged, terrorized Coney Island and other parts of the City by selling illegal narcotics, murdering members of a rival gang and using violence and intimidation to achieve his criminal objectives.”
The charges are merely allegations, and the defendant is presumed innocent unless and until proven guilty. If convicted of the charges in the indictment, Smith faces a maximum sentence of life imprisonment.
The government’s case is being prosecuted by the Office’s Organized Crime and Gangs Section. Assistant United States Attorney Maria Cruz Melendez is in charge of the prosecution.
The Defendant:
FRANK SMITH
Age: 31
Staten Island, New YorkEDNY Docket No. 16-CR-346
Lowell Man Sentenced for $440,000 Embezzlement SchemeRead the Press Release
BOSTON – A Lowell man was sentenced today in U.S. District Court in Boston in connection with the theft of more than $440,000 from a Spain-based seafood and fish distributor for which he served as the United States representative.
Jorge Manuel Silva, 59, was sentenced by U.S. District Court Judge Nathaniel M. Gorton to 15 months in prison, two years of supervised release and restitution of $440,398. In March 2016, he pleaded guilty to two counts of bank fraud.
Silva was an independent contractor for Seaport Fish Co., a corporation established to distribute fish and seafood in the United States by Freiremar Group, headquartered in Spain. Silva was responsible for coordinating sales to Seaport customers, collecting customer payments, and depositing those payments into Seaport’s account at Bank of America. From July 2008 through June 2010, Silva instead diverted more than $903,000 in Seaport customer checks to two accounts he held at Enterprise Bank in Lowell.
On occasion, Silva reimbursed Seaport with checks drawn on his Enterprise accounts several weeks or months after he had deposited the customer checks into those accounts. On other occasions, he used Seaport funds to pay personal expenses and the expenses for his other businesses. In this fashion, Silva diverted $440,398 of Seaport funds to his own uses.
United States Attorney Carmen M. Ortiz; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and Shelly Binkowski, Inspector in Charge of the U.S. Postal Inspection Service, made the announcement today. The case was prosecuted by Assistant U.S. Attorney Sandra S. Bower of Ortiz’s Economic Crimes Unit.
Louisville Based MD2U, a Regional Provider of Home-Based Care, and Its Principal Owners Admit to Violating the Federal False Claims Act and Being Liable for MillionsRead the Press Release
Knowingly Presented False Claims and Altered Records to Get False Claims Paid Will Pay Millions to Settle Allegations
MD2U Holding Company, including its related companies and individually named owners, have agreed to pay millions to resolve a government lawsuit alleging that they violated the federal False Claims Act by knowingly submitting false medical claims to Medicare and other government health care programs, altering records to support false claims and providing services that were medically unnecessary, announced U.S. Attorney John E. Kuhn Jr. for the Western District of Kentucky
“Unfortunately, our healthcare system is under assault from a small minority of providers who engage in fraudulent billing, overbilling and providing unnecessary services,” said U.S. Attorney Kuhn. “In an effort to control these losses and force accountability, my office and the Department of Justice pursues and recovers false and fraudulent billings as one of its highest priorities. This significant case against MD2U is but one example of the vigorous work against healthcare fraud taking place in the Western District and across the nation.”
“This provider billed for medically unnecessary home visits and often grossly exaggerated the level of service provided,” said Special Agent in Charge Derrick L. Jackson for the U.S. Department of Health and Human Services’ Office of Inspector General (HHS-OIG) in Atlanta. “The OIG is committed to protecting the integrity of federal health care programs by aggressively pursuing entities that increase their revenue through deceitful schemes and trickery.”
The government’s complaint alleged that between July 1, 2007, and Nov. 30, 2014, MD2U submitted false billings for patients who were neither homebound nor home-limited; improperly billed the government for medically unnecessary visits; billed government health care programs at the highest payment codes (upcoding) when a lower code would have been more appropriate; and cloned medical records (a cut, copy, paste electronic program) in order to justify patient visits. Specifically, the government’s complaint alleged that MD2U’s schemes included the following:
- MD2U required non-physician providers (NPPs) to document that patients were homebound or home-limited and indicate in the medical record that an outpatient visit would jeopardize the patient’s health, regardless as to whether this was true or not. A number of MD2U patients were neither homebound nor home-limited, as some patients worked outside the home, attended school outside the home, drove independently, routinely saw other providers in the office and in at least one case, went horseback riding.
- MD2U would require NPPs to perform medically unnecessary visits and improperly bill Government Health Care Programs for evaluation and management (E&M) visits in order to generate revenue. Management instructed NPPs to schedule patient visits more frequently than necessary in order to increase productivity.
- According to a review of Medicare claims submitted by MD2U between July 1, 2007, and Nov. 30, 2014, 98 percent were falsely billed to Medicare. NPPs’ patient visits would often last less than ten minutes with some lasting less than five minutes (and in at least one reviewed case – 34 seconds), but these encounters were billed as comprehensive medical visits and billed at the highest level E&M code possible. The American Medical Association’s guidelines for these codes indicate that practitioner’s using the codes billed by MD2U should be performing comprehensive medical exams and should typically spend 60 minutes face-to-face with the patient, family member or caregiver.
- Management trained NPPs to bill all visits using the highest level E&M code available.
- MD2U also utilized an electronic medical records (EMR) system that permitted the NPPs to easily electronically cut, copy and paste medical notes from prior visits. The ability to migrate notes from visits that occurred weeks, months, or even years prior to the current patient encounter created the illusion that MD2U’s NPPs were performing a significant amount of work during their patient encounters when, in fact, they were not. If the documentation was deficient to bill the highest level code, MD2U would direct NPPs to go back and change the medical record – after the encounter had occurred – to falsely show that more work was performed during the visit in order to support the highest level billing.
Through a stipulation and order to be entered by the court, the defendants have admitted that they violated the False Claims Act, 31 U.S.C. §§ 3729-3733, by (a) making or causing others to make false statements and (b) submitting or causing others to submit false claims to the United States. The defendants admit that these actions caused damages and that they are liable to the United States in the amount of $21,511,756 under the False Claims Act (which allows for damages in the amount of three times the government’s loss, plus penalties).
Further, in the consent judgment to be entered by the court, defendants J. Michael Benfield, Chief Executive Officer and President of MD2U; Greg Latta, Chief Information Officer; and Karen Latta, Chief Operations Officer, all owners, residing in Louisville, Kentucky, admit that, due in part to the actions of a former employee, they caused the submission of false claims to the United States in violation of the False Claims Act. They further admit that the submission of the claims for payment caused these damages as a result of misrepresentations, false representations and/or deceptive conduct; that it was done with reckless disregard of the falsity of the claims; and in doing so, caused the United States to be deceived.
Through the terms of the stipulation and order, the defendants can fulfill their obligations to pay the consent judgment by paying $3.3 million and a percentage of MD2U’s net income over the next five years. The defendants have also agreed to enter into a five year corporate integrity agreement with HHS-OIG.
The settlement announced today illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $27.1 billion through False Claims Act cases, with more than $17.1 billion of that amount recovered in cases involving fraud against federal health care programs. Tips and complaints from all sources about potential fraud, waste, abuse and mismanagement, including the conduct described in the United States’ complaint, can be reported to the Department of Health and Human Services, at 1-800-HHS-TIPS (1-800-447-8477).
This matter was handled by Assistant U.S. Attorney Benjamin S. Schecter with the U.S. Attorney’s Office for the Western District of Kentucky, HHS-OIG; Defense Criminal Investigative Services; and the Railroad Retirement Board, Office of the Inspector General.
The case is captioned United States v. MD2U Holding Company et al., Case No. 3:16-cv-00440-GNS
Louisville Based MD2U, A Regional Provider of Home-Based Care, and Its Principal Owners Admit to Violating the Federal False Claims Act and Being Liable for MillionsRead the Press Release
Knowingly presented false claims and altered records to get false claims paid
Will pay millions to settle allegations
LOUISVILLE, KY – MD2U Holding Company, including its related companies and individually named owners (“Defendants”), have agreed to pay millions to resolve a government lawsuit alleging that they violated the federal False Claims Act by knowingly submitting false medical claims to Medicare and other government health care programs, altering records to support false claims, and providing services that were medically unnecessary U.S. Attorney John E. Kuhn, Jr. today announced.
"Unfortunately, our healthcare system is under assault from a small minority of providers who engage in fraudulent billing, overbilling, and providing unnecessary services," stated U.S. Attorney Kuhn. "In an effort to control these losses and force accountability, my office and the Department of Justice pursues and recovers false and fraudulent billings as one of its highest priorities. This significant case against MD2U is but one example of the vigorous work against healthcare fraud taking place in the Western District and across the nation."
"This provider billed for medically unnecessary home visits and often grossly exaggerated the level of service provided," said Derrick L. Jackson, Special Agent in Charge at the U.S. Department of Health and Human Services, Office of Inspector General in Atlanta. "The OIG is committed to protecting the integrity of federal health care programs by aggressively pursuing entities that increase their revenue through deceitful schemes and trickery.”
The government’s complaint alleged that between July 1, 2007, and November 30, 2014, MD2U submitted false billings for patients who were neither homebound nor home-limited; improperly billed the government for medically unnecessary visits; billed government health care programs at the highest payment codes (upcoding) when a lower code would have been more appropriate; and cloned medical records (a cut, copy, paste electronic program) in order to justify patient visits. Specifically, the government’s complaint alleged that MD2U’s schemes included the following:
-
MD2U required nonphysician providers (NPPs) to document that patients were homebound or home-limited and indicate in the medical record that an outpatient visit would jeopardize the patient’s health, regardless as to whether this was true or not. A number of MD2U patients were neither homebound nor home-limited, as some patients worked outside the home, attended school outside the home, drove independently, routinely saw other providers in the office, and in at least one case, went horseback riding.
-
MD2U would require NPPs to perform medically unnecessary visits and improperly bill Government Health Care Programs for evaluation and management (E&M) visits in order to generate revenue. Management instructed NPPs to schedule patient visits more frequently than necessary in order to increase productivity.
-
According to a review of Medicare claims submitted by MD2U between July 1, 2007, and November 30, 2014, 98 percent were falsely billed to Medicare. NPPs’ patient visits would often last less than ten minutes with some lasting less than 5 minutes (and in at least one reviewed case – 34 seconds), but these encounters were billed as comprehensive medical visits and billed at the highest level E&M code possible. The American Medical Association’s guidelines for these codes indicate that practitioner’s using the codes billed by MD2U should be performing comprehensive medical exams and should typically spend 60 minutes face-to-face with the patient, family member or caregiver.
-
Management trained NPPs to bill all visits using the highest level E&M code available.
-
MD2U also utilized an electronic medical records (EMR) system that permitted the NPPs to easily electronically cut, copy and paste medical notes from prior visits. The ability to migrate notes from visits that occurred weeks, months, or even years prior to the current patient encounter created the illusion that MD2U’s NPPs were performing a significant amount of work during their patient encounters when, in fact, they were not. If the documentation was deficient to bill the highest level code, MD2U would direct NPPs to go back and change the medical record – after the encounter had occurred – to falsely show that more work was performed during the visit in order to support the highest level billing.
Through a Stipulation and Order to be entered by the Court, the Defendants have admitted that they violated the False Claims Act, 31 U.S.C. §§ 3729-3733, by (a) making or causing others to make false statements and (b) submitting or causing others to submit false claims to the United States. The Defendants admit that these actions caused damages and that they are liable to the United States in the amount of $21,511,756 under the False Claims Act (which allows for damages in the amount of three times the government’s loss, plus penalties).
Further, in the Consent Judgment to be entered by the Court, defendants J. Michael Benfield, Chief Executive Officer and President of MD2U; Greg Latta, Chief Information Officer; and Karen Latta, Chief Operations Officer, all owners, residing in Louisville, admit that, due in part to the actions of a former employee, they caused the submission of false claims to the United States in violation of the False Claims Act. They further admit that the submission of the claims for payment caused these damages as a result of misrepresentations, false representations, and/or deceptive conduct; that it was done with reckless disregard of the falsity of the claims; and in doing so, caused the United States of America to be deceived.
Through the terms of the Stipulation and Order, the Defendants can fulfill their obligations to pay the Consent Judgment by paying $3.3 million and a percentage of MD2U’s net income over the next five years. The Defendants have also agreed to enter into a five year Corporate Integrity Agreement with the Department of Health and Human Services, Office of Inspector General.
The settlement announced today illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $27.1 billion through False Claims Act cases, with more than $17.1 billion of that amount recovered in cases involving fraud against federal health care programs. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement, including the conduct described in the United States’ complaint, can be reported to the Department of Health and Human Services, at 800-HHS-TIPS (800-447-8477).
This matter was handled by Assistant United States Attorney Benjamin S. Schecter with the U.S. Attorney’s Office for the Western District of Kentucky, the Department of Health and Human Services, Office of Inspector General; Defense Criminal Investigative Services; and the Railroad Retirement Board, Office of the Inspector General.
The case is captioned United States v. MD2U Holding Company et al., Case No. 3:16-cv-00440-GNS.
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Lewiston Man Sentenced to 7 Years for Trafficking Heroin, Oxycodone, Crack and Cocaine and Possessing Firearms During the Drug TraffickingRead the Press Release
Contact: Daniel J. Perry
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: Matthew Mennealy, 34, of Lewiston, Maine, was sentenced yesterday by United States District Judge George Z. Singal for his involvement in distributing heroin, oxycodone, crack and cocaine and possessing firearms while drug trafficking. Mennealy received a sentence of 84 months in prison to be followed by 3 years of supervised release for these crimes.
According to Court records, in December 2014, agents stopped a vehicle in which Mennealy was a passenger. The agents subsequently searched the vehicle and located cocaine base, oxycodone pills, heroin, and a loaded 22 caliber handgun which had a live round in the chamber.
Agents later sought and obtained a search warrant for Mennealy’s residence. The subsequent search of the residence revealed a bin hidden in the basement ceiling that contained 46 grams of cocaine base, 79 grams of cocaine, 59 grams of heroin, and 106 oxycodone 30 mg. pills. The agents discovered a loaded pistol secreted under a pillow in the master bedroom and a loaded handgun in the kitchen next to a surveillance system.
Mennealy was charged with the drug trafficking crimes and possessing firearms in relation to those drug crimes in June 2015. Mennealy pleaded guilty to those charges on January 26, 2016.
This case results from a collaborative investigation conducted by the U.S. Drug Enforcement Administration and the Maine Drug Enforcement Agency.
KC Man Sentenced to 30 Years for Drug Trafficking, Money Laundering ConspiraciesRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a Kansas City, Mo., man has been sentenced in federal court for his role in conspiracies to distribute methamphetamine in Jackson County, Mo., and to engage in money laundering.
Travis Ybarra, also known as “HoodNutt,” 27, of Kansas City, was sentenced by U.S. Chief District Judge Greg Kays on Wednesday, July 6, 2016, to 30 years in federal prison without parole.
On Aug. 28, 2015, Ybarra was found guilty of participating in a conspiracy to distribute methamphetamine from Jan. 1, 2009, to Dec. 11, 2012. Ybarra was also found guilty of participating in a money-laundering conspiracy that involved proceeds of drug trafficking.
Ybarra was found responsible for the distribution of more than 15 kilograms of methamphetamine. During the conspiracy, he made concerted efforts to threaten and locate for retribution individuals he believed owed him money and had cheated one of his drug dealers. He was recorded on telephone intercepts making threats.
Ybarra fled from law enforcement and discarded a firearm and methamphetamine. At the time of his arrest Ybarra was in possession of a firearm, ammunition and a Taser (along with drugs and drug trafficking items such as a money counter). His pre-trial release was revoked for fleeing from the police at such a high rate of speed that his car went airborne, and for being in possession of a semi-automatic assault-style rifle with four magazines and 119 rounds of ammunition and a 9mm handgun with 14 rounds.
In July 2011, the Jackson County Drug Task Force began an investigation into a drug-trafficking organization distributing methamphetamine in the Kansas City, Mo., area. Ybarra and co-defendant John Martinez, also known as “Whisper,” of Kansas City, Mo., were partners who supplied methamphetamine to mid-level distributers, who then sold the methamphetamine to others.
Martinez was sentenced on Feb. 10, 2015, to 12 years and six months in federal prison without parole, after pleading guilty to the same charges.
This case was prosecuted by Assistant U.S. Attorneys Bruce Rhoades and Adam Caine. It was investigated by the Drug Enforcement Administration, the Independence, Mo., Police Department, the Jackson County Drug Task Force and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
KC Man Pleads Guilty to Child Porn After Attempting to Meet Two Minors for SexRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Kansas City, Mo., man pleaded guilty in federal court today to distributing child pornography following an undercover operation in which he attempted to meet two minor girls for sex.
Daniel C. Irwin, 38, of Kansas City, pleaded guilty before U.S. District Judge Roseann Ketchmark to the charge contained in an Aug. 27, 2014, federal indictment.
By pleading guilty today, Irwin admitted that he distributed a video of child pornography over the Internet on July 21, 2014. Irwin was an assistant vice president of accounting at State Street in Kansas City at the time of the offense.
Irwin admitted that he sent the child pornography video to an undercover detective with the Kansas City, Mo., Police Department. Irwin met with the undercover detective and attempted to exchange incest pornography for the opportunity to have sex with the undercover detective’s two minor daughters (ages 12 and 16). Irwin sent additional videos of child pornography to the undercover detective on Aug. 4, 2014.
Under federal statutes, Irwin is subject to a mandatory minimum sentence of five years in federal prison without parole, up to a sentence of 20 years in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Patrick D. Daly. It was investigated by the Kansas City, Mo., Police Department and the FBI.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Justice Department Announces Settlement Agreement with Seattle Cancer Care Alliance over Pharmacy Control FailuresRead the Press Release
WASHINGTON - The Department of Justice announced today that it has reached a settlement with Seattle Cancer Care Alliance (SCCA) relating to losses of more than 96,000 pills of oxycodone between 2011 and 2013. SCCA self-reported the diversions after discovering that a nurse employed at the cancer care center had used falsified and altered prescriptions to divert oxycodone from SCCA’s on-site pharmacy. The nurse conducted the scheme by drafting prescriptions for patients who were formerly receiving care at the center, obtaining physician signatures on those prescriptions, and then altering the prescriptions to reflect higher quantities and doses before transmitting them to the on-site pharmacy to be filled. The nurse would then pick up the controlled substances from the pharmacy under the guise that she was doing so as a service to the patient. Once her scheme was discovered, SCCA terminated the nurse’s employment. She subsequently took her own life.
“In our efforts to combat unlawful uses of prescription drugs we depend on the vigilance of pharmacists to closely monitor and enforce the controlled system of distribution,” said First Assistant, Helen J. Brunner. “This case reflects the Justice Department’s commitment to use all of the enforcement tools at our disposal to ensure that highly-abused substances are provided to patients under the supervision of their doctors and not leaked to the illicit drug trade.”
The investigation by the Department of Justice, in partnership with the Drug Enforcement Administration, determined that SCCA’s pharmacists violated the Controlled Substances Act when they dispensed controlled substances to the nurse who was conducting the fraud. Specifically, DOJ found that that the pharmacists were not acting in the “usual course of their professional practice” when they failed to take steps to verify that the high-dose, high-quantity painkillers “prescribed” were appropriate for the patients purportedly receiving them, based upon each patient’s prior prescription history. In fact, many of the former patients whose identities were used in the scheme were “opiate naïve.” Had these individuals actually received and taken the high-quantity, high-dose oxycodone filled in their names, they could have been harmed as a result.
The scheme carried out by the nurse was first uncovered in 2013, when a former patient at SCCA was injured on the job and was given a legitimate prescription for pain medication. Washington State’s Department of Labor and Industries denied the claim because the state Prescription Monitoring Program indicated the patient was already receiving high strength pain medication from SCCA. When the patient disputed receipt of such medications, workers with L&I alerted SCCA, which launched the internal investigation and uncovered the fraud. Since its discovery, SCCA has notified all the affected patients about the fraud.
Under the settlement reached July 7, 2016, SCCA admits no law violation, wrongdoing or misconduct but agreed, among other things to: (1) require its pharmacists to consult with the prescriber, or take other reasonable steps, to confirm the prescription’s appropriateness and veracity whenever there are signs that a prescription for a controlled substance is not appropriate for the patient to whom it is prescribed based upon the patient’s prior prescription history; (2) add an entry regarding the nurse’s fraud in the SCCA prescription and clinic records for each of the patients whose identities were used for the false prescriptions; and (3) pay the United States $250,000.
The Drug Enforcement Administration monitors pharmacy prescribing practices to ensure compliance with federal law. Pharmacies found in violation face escalating penalties up to the revocation of their DEA Registration number which allows them to write prescriptions for controlled substances.
The case was litigated by Assistant U.S. Attorney Christina Fogg in the U.S. Attorney’s Office for the Western District of Washington.
settlement_agreement_fully_executed_2.pdf
Joint Investigation Takes Down Willimantic Drug Trafficking RingRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, Patricia Froehlich, Connecticut State’s Attorney for the Judicial District of Windham, Michael J. Ferguson, Special Agent in Charge of the Drug Enforcement Administration for New England, and Cpl. Stanley Parizo, Jr. of the Willimantic Police Department today announced that a federal grand jury in New Haven returned an indictment today charging nine men with distributing heroin, cocaine and crack cocaine in and around Willimantic.
As alleged in court documents and statements made in court, in October 2015, the DEA and Willimantic Police Department, with the assistance of the Connecticut State Police, initiated an investigation into a Willimantic-based narcotics trafficking ring. The investigation, which has included the use of confidential informants, physical surveillance, controlled purchases of drugs and court authorized wiretaps on five cellular telephones utilized by the alleged co-conspirators, revealed that JOSE MIRANDA of the Bronx, New York, was supplying large quantities of heroin and cocaine to CARLOS LOPEZ-ZELADA of Willimantic and PERSIO HERNANDEZ of North Windham. LOPEZ-ZELADA and HERNANDEZ, with the help of other co-conspirators, then distributed heroin, cocaine and crack cocaine in the Willimantic area. The investigation further revealed that LOPEZ-ZELADA utilized a garage unit located on Willimantic Road in Chaplin as a stash location and point of distribution for narcotics.
The indictment charges the following nine defendants with conspiracy to possess with intent to distribute, and to distribute, heroin, cocaine and cocaine base (“crack”):
JOSE MIRANDA, a.k.a. “Omar,” 51, of the Bronx, N.Y.
CARLOS ALBERTO LOPEZ-ZELADA, a.k.a. “Willi Mexico,” 39, of Willimantic
RAFAEL GUERRERO-OLEA, a.k.a. “Rafi,” 45, of Chaplin
PERSIO HERNANDEZ, 47, of North Windham
ALBERTO DEJESUS-ROSADO, 30, of Willimantic
JOSE APONTE, 35, of North Windham
JOSE LIZARDO-OLEA, 31, of Willimantic
ANDRES SOLIS, a.k.a. “Shorty” and “Andresito,” 23, of North Windham
RENSO JIMINEZ-JEREZ, a.k.a. “Matrella,” 35, of North WindhamThe indictment also charges LOPEZ-ZELADA and GUERRERO-OLEA with possession with intent to distribute heroin.
On June 23, 2016, MIRANDA was arrested on a federal criminal complaint. It is alleged that MIRANDA was arrested before the investigation had reached its natural conclusion because he was intercepted threatening to shoot a co-conspirator who refused to pay him for a quantity of heroin that MIRANDA had provided to the individual on consignment. MIRANDA has been detained since his arrest.
Seven defendants were arrested yesterday on federal criminal complaints and are also detained. JIMINEZ-JEREZ is being sought by law enforcement.
In association with the arrests of the defendants, law enforcement officers seized suspected heroin, cocaine and crack cocaine, as well as a shotgun, from a North Windham residence shared by HERNANDEZ, SOLIS and JIMINEZ-JEREZ.
If convicted, the defendants face a maximum term of imprisonment of 20 years and a fine of up to $1 million on each count of the indictment.
“We are committed to using federal law enforcement resources to battle the opioid epidemic in Connecticut, and this investigation was funded in part with money received through the Justice Department’s National Heroin Strategic Initiative,” said U.S. Attorney Daly. “I congratulate the Windham State’s Attorney’s Office, DEA, Willimantic Police Department and Connecticut State Police for taking down this trafficking ring and slowing the flow of these deadly drugs into eastern Connecticut.”
“I am always impressed by what we achieve when we all work together,” said Windham State’s Attorney Patricia Froehlich. “The criminal justice system functions effectively only when various agencies work in cooperation with each other, and that is what happened in this case. I appreciate the efforts of all involved.”
“Those suffering from the disease of heroin addiction need access to treatment and recovery,” said DEA Special Agent in Charge Ferguson. “But, those responsible for distributing lethal drugs like heroin and fentanyl in the neighborhoods of Willimantic and throughout Connecticut need to be held accountable for their actions. In response to the ongoing opioid epidemic, DEA and its federal, state and local partners are committed to bringing to justice those that distribute this poison.”
“We are pleased with these arrests and narcotics seizures,” said Cpl. Stanley Parizo, Jr. of the Willimantic Police Department. “This has been an ongoing effort to combat narcotics trafficking within the City of Willimantic. The cooperative efforts of our federal law enforcement partners, the Willimantic Criminal Investigation Division, Willimantic SWAT team and all three city K9 teams made this a great success.”
U.S. Attorney Daly stressed that an indictment is not evidence of guilt. Charges are only allegations, and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This matter is being prosecuted by Assistant U.S. Attorneys Patrick Caruso, Amy Brown, and David Nelson, and Assistant State’s Attorney Matthew Crocket.
Johnston Resident Charged with Drug Trafficking, Money LaunderingRead the Press Release
PROVIDENCE, R.I. – Juan G. Catala, 41, of Johnston, made an initial appearance in U.S. District Court in Providence today on charges he allegedly trafficked oxycodone and marijuana, and that he allegedly laundered the proceeds of his drug trafficking activities, announced United States Attorney Peter F. Neronha and Jeffrey Ebersole, Special Agent in Charge of the U.S. Food and Drug Administration Office of Criminal Investigations (FDA OCI).
Catala is charged by way of a federal criminal complaint with one count each of distribution of oxycodone, possession with the intent to distribute marijuana and money laundering.
According to information presented to the court, between January 2016 and March 2016, an individual assisting law enforcement in the investigation of Catala’s alleged drug trafficking activities allegedly made at least four purchases of oxycodone tablets from Catala. Each of the purchases, ranging between 39 and 87 oxycodone tablets, were electronically monitored by law enforcement. It is alleged that, at Catala’s direction, most of the cash payment for each alleged transaction was made directly into a bank account established by Catala.
On July 6, FDA OCI agents executed a court authorized search of Catala’s residence where they discovered and seized 70 pounds of marijuana, in excess of $10,000 in cash and several empty prescription bottles which previously contained oxycodone tablets. Agents seized an additional $1,500 in cash from Catala’s vehicle.
A criminal complaint is merely an allegation and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt. Catala, who has been detained since his arrest, was ordered released on $10,000 unsecured bond with electronic monitoring following his initial appearance in U.S. District Court.
The case is being prosecuted by Assistant U.S. Attorney Ronald R. Gendron.
United States Attorney Peter F. Neronha acknowledges and thanks the Rhode Island State Police, DEA, and the Johnston and Middletown Police Departments for their assistance in this matter.
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Contact:
Jim Martin (401) 709-5357
email: [email protected]
Jefferson Parish Woman Charged with Defrauding Local BusinessRead the Press Release
U.S. Attorney Kenneth A. Polite announced that TRACY NICHELSON, age 42, a resident of Metairie was charged today in a Bill of Information with one count of bank fraud.
According to the Bill of Information, NICHELSON worked as an assistant of rental management for a New Orleans real estate business. From June 2012 until July 2013, NICHELSON embezzled $16,418 from her employer. NICHELSON issued approximately 13 unauthorized checks to herself and others by forging the signature of the business’s owner.
If convicted, NICHELSON faces up to thirty years imprisonment and up to a $1,000,000 fine as well as restitution for the money embezzled.
U.S. Attorney Polite reiterated that a Bill of Information is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
U.S. Attorney Polite praised the work of the U.S. Postal Inspection Service in investigating this matter. Assistant United States Attorney Julia K. Evans is in charge of the prosecution.
Jacksonville Man Pleads Guilty to Advertising for Child PornographyRead the Press Release
Jacksonville, Florida – United States Attorney A. Lee Bentley, III announces that Chad Jason Lansford (31, Jacksonville) has pleaded guilty to advertising for child pornography. He faces a minimum mandatory penalty of 15 years, up to 30 years, in federal prison. Lansford has been in federal custody since his arrest on March 12, 2015.
According to court documents, in January 2015, law enforcement officers responded to a complaint involving the mother of a nine-year-old girl who had found several sexually explicit images on her daughter’s social media account, including two images of her daughter. A review of the child’s iPod revealed online conversations between the girl and an individual later identified as Lansford. Further investigation revealed that on January 2, 2015, Lansford had sent the child images of his genitalia. During an online conversation that day, Lansford was advised that the child was nine years old. Despite this knowledge, he repeatedly requested that she take pornographic pictures of herself and send them to him. Eventually, the child complied with Lansford’s demands and produced and sent pornographic pictures of herself to him.
On March 12, 2015, law enforcement officers executed a federal search warrant at Lansford’s apartment. He was at the residence and admitted that he was the person who had engaged in the online conversations with the child.
This case was investigated by the Federal Bureau of Investigation and the Jacksonville Sheriff’s Office. It is being prosecuted by Assistant United States Attorney D. Rodney Brown.
It is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Inmates Charged with Orchestrating Mail and Wire Fraud Scheme from Federal PrisonRead the Press Release
Four individuals have been charged in connection with a fraud scheme orchestrated from the Federal Detention Center in Miami, Florida.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Katherine Fernandez Rundle, State Attorney for Miami-Dade County, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Scott Israel, Sheriff, Broward Sheriff’s Office (BSO), and Mark Overton, Chief, Bal Harbour Police Department, made the announcement.
James Sabatino, 39, of Miami, George Duquen, 53, of Davie, Valerie Kay Hunt, 53, of Davie, and Denise Siksha Lewis, 35, of North Lauderdale, were charged by indictment with conspiracy to commit mail and wire fraud, mail fraud, and wire fraud, in violation of Title 18, United States Code, Sections 1349, 1341, and 1343.
During the course of the alleged conspiracy, Sabatino and Duquen were incarcerated together at the Federal Detention Center in Miami, Florida. According to publicly filed court documents, Sabatino created several e-mail addresses for the purpose of impersonating employees of Sony Music Entertainment, a recorded music company.
Using the alias “James Prolima,” Sabatino contacted several luxury store employees and brand representatives via telephone calls, e-mails, and text messages. During those communications, Sabatino pretended to be an employee of Sony Music Entertainment and RocNation, a recorded music company founded by a prominent recording artist.
According to the indictment, Sabatino requested that the luxury store employees and brand representatives send retail items such as handbags, wristwatches, apparel, and jewelry to various locations in South Florida. Sabatino claimed the retail items would be featured in music videos and promotional materials that were being filmed and produced in Miami, Florida.
According to court records, Sabatino directed luxury store employees and brand representatives to ship the retail items to co-defendants Hunt and Lewis. From prison, Sabatino and co-defendant Duquen directed Hunt and Lewis to sell the items at South Florida pawn shops and elsewhere.
Mr. Ferrer commended the investigative efforts of the FBI, BSO, and the Bal Harbour Police Department. This case is being prosecuted by Assistant United States Attorney Christopher Browne.
An indictment is only an accusation and a defendant is presumed innocent unless and until proven guilty.
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.
- Indictment in U.S. v. Norman Seabrook and Murray Huberfeld
- Indictment in U.S. v. James Grant, Michael Harrington, Jeremy Reichberg
Hudson County Man Sentenced to Five Years in Prison for Role in $13 Million Mortgage Fraud SchemeRead the Press Release
CAMDEN, N.J. – A Hudson County, New Jersey, man was sentenced today to 60 months in prison for his role in a $13 million mortgage fraud scam that used phony documents and “straw buyers” to make illegal profits on overbuilt condos in Wildwood and Wildwood Crest, New Jersey, U.S. Attorney Paul J. Fishman announced.
John Leadbeater, 59, of Kearny, New Jersey, previously pleaded guilty before U.S. District Judge Jerome B. Simandle to a superseding indictment charging him with conspiracy to commit wire fraud. Judge Simandle imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
Leadbeater and his conspirators located condominiums overbuilt by financially distressed developers in Wildwood and Wildwood Crest, New Jersey. They then recruited “straw buyers” from New Jersey, New York, Ohio, Arkansas, and California, to purchase those properties. The straw buyers had good credit scores, but lacked the financial resources to qualify for the mortgage loans. The conspirators created false documents, including loan applications that contained fraudulent financial and employment information, to make the straw buyers appear more credit-worthy and induce the lenders to make the loans.
Once the loans were approved, Leadbeater and his conspirators created and signed fraudulent closing documents in order to induce the mortgage lenders to send the loan proceeds in connection with real estate closings on the properties. Once the mortgage lenders sent the loan proceeds, Leadbeater and his conspirators took a portion of the proceeds, having funds wired or checks deposited into various accounts they controlled. They also distributed a portion of the proceeds to the other members of the conspiracy for their respective roles.
Leadbeater admitted to personally participating in fraudulent activity related to nine properties in Wildwood and Wildwood Crest. He admitted causing mortgage lenders to fund $4,711,557 worth of mortgages based on the bogus loan applications and closing documents prepared by him and his conspirators.
In addition to the prison term, Judge Simandle sentenced Leadbeater to five years of supervised release. A restitution hearing has been set for July 28, 2016.
U.S. Attorney Fishman credited special agents from the FBI’s Atlantic City Resident Agency, under the direction of Special Agent in Charge Timothy Gallagher in Newark; and special agents of IRS-Criminal Investigation in Mays Landing, under the direction of Special Agent in Charge Jonathan D. Larsen in Newark, for the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorneys Jacqueline M. Carle and Matthew T. Smith of the U.S. Attorney's Office Criminal Division in Camden.
Defense counsel: Thomas J. Cammarata Esq. and Jeffrey Garrigan Esq., Jersey City
Houston Woman Pleads Guilty in Conspiracy to Traffick Heroin Using MegabusRead the Press Release
U.S. Attorney Kenneth A. Polite announced that MARTHA QUINONES, age 51, of Houston, Texas, pled guilty today to conspiracy to distribute and to possess with intent to distribute over one kilogram of heroin.
QUINONES was one of eight defendants charged in a 21-count Superseding Indictment on September 18, 2015. According to court documents, this Indictment resulted from an FBI investigation into a heroin-trafficking organization operating primarily around Loyola Avenue and Harmony Street in Central City, New Orleans. QUINONES was one of two sources who traveled via Megabus from Houston to New Orleans, carrying half-kilogram quantities of heroin for distribution in the New Orleans area.
QUINONES is facing not less than 10 years and a maximum of life imprisonment, as well as a possible fine of up to $10,000,000. U.S. District Judge Carl J. Barbier set sentencing on October 13, 2016.
U.S. Attorney Polite praised the work of the FBI New Orleans Gang Task Force (NOGTF), Saint Tammany Parish Sheriff’s Office, the Jefferson Parish Sheriff’s Office, and the New Orleans Police Department in investigating this matter. Assistant United States Attorney Brandon S. Long is in charge of the prosecution.
Honduran National Sentenced for Illegally ReentryRead the Press Release
U.S. Attorney Kenneth A. Polite announced that JORGE PULIDO-HERRERA, a/k/a JORGE LICONA-CERRATO, age 46, a citizen of Honduras, was sentenced after previously pleading guilty to a one-count Bill of Information for illegal reentry of removed alien.
U.S. District Judge Carl J. Barbier sentenced PULIDO-HERRERA to time served, followed by one year of supervised release, and a $100.00 special assessment. Additionally, PULIDO-HERRERA will be surrendered to the custody of the U.S. Immigration and Customs Enforcement for removal proceedings.
According to the Bill of Information, on or about March 15, 2016, PULIDO-HERRERA was found in the United States after having been officially deported and removed on or about December 8, 1999.
U.S. Attorney Polite praised the work of the United States Department of Homeland Security, Immigration Enforcement in investigating this matter. Assistant United States Attorney Irene González was in charge of the prosecution.
Honduran 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 Alexander Alcerro-Romero, of Honduras, pleaded guilty to a one-count indictment alleging that he illegally reentered the United States after having been previously deported.
In March of 2016, an ICE ERO Deportation Officer developed information which indicated that the defendant, a Honduran national, was illegally present in the United States after having been deported on two previous occasions. On April 11, 2016, the defendant was observed by ICE-ERO Deportation Officers entering a silver sedan that was parked directly in front of the defendant’s residence in Nashua, New Hampshire.
A vehicle stop was conducted during which the Deportation Officer approached the defendant and asked him in English if he had a driver’s license. The defendant responded “not one from this country” and presented the Deportation Officer with a Honduran identity document. After verbally confirming that the defendant was a Honduran national, the deportation Officer asked the defendant if he had any immigration documents that allowed him to be in the U.S. The defendant responded “no”, and was then taken into ICE custody for being illegally present in the United States and transported to the ERO-MAN office for administrative processing.
Fingerprint impressions taken at the time of processing were compared to fingerprints on record with the Department of Homeland Security. The fingerprint comparison confirmed that the defendant had been deported from the United States to Honduras in 2005 and 2008.
Alcerro-Romero will be sentenced at 10:00 AM on November 15, 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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Galveston Pimp Found Guilty on Charges of Sex Trafficking of MinorsRead the Press Release
GALVESTON, Texas – A jury sitting in Galveston has returned guilty verdicts against a Galveston man on one charge of conspiracy to commit sex trafficking of minors and four counts of sex trafficking of minors, announced U.S. Attorney Kenneth Magidson. The jury convicted Charles Devan Fulton Sr., 39, late yesterday following a six-day trial and approximately four hours of deliberation.
Co-defendants Charmell Latonya Potts, 31, Dominique Warner, 23, and Lawrence James Julian, 22, all of Galveston, previously pleaded guilty.
The jury found Fulton engaged in a conspiracy with the others between June 1, 2014, through April 1, 2015, in which they engaged in conspiracy to recruit, entice and harbor minors to engage in sex trafficking. Fulton aka “Black” or “Blacc,” was the leader of the group and ordered Potts to post pictures of two of the identified minor victims in prostitution ads on line. Warner aka “Meathead,” Julian aka “Wolf” and Potts also drove the minor females to hotels where the minors would engage in commercial sex acts.
The jury heard that the minors engaged in hundreds of commercial sex acts over the course of the conspiracy. The victims testified at trial, as did Potts, that Fulton would keep the money the children earned performing commercial sex acts. The jury also heard that Fulton used force, threats of force, fraud or coercion against two of the victims. In addition, testimony revealed Fulton had sex with the victims knowing they were minors, that he provided them with drugs and he had no legitimate source of income.
Fulton attempted to convey his innocence and that police were just out to get him. The jury was not convinced and found him guilty on five counts.
Fulton faces up to life in prison and is set for sentencing in October 2016. He will remain in custody pending that hearing.
The FBI and the Galveston Police Department investigated with the assistance of the Galveston County District Attorney’s Office. Assistant U.S. Attorneys Sherri Zack and Julie Searle prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Four Conspirators Indicted in Chicago-Based Stolen Identity Refund Fraud SchemeRead the Press Release
A federal grand jury sitting in Chicago, Illinois, returned an indictment, which was unsealed yesterday, charging four Chicago-area residents with conspiracy to commit theft of government money, wire fraud, theft of government money, aggravated identity theft and access device fraud, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney Zachary T. Fardon of the Northern District of Illinois.
The indictment charges Roxann Gist, Dominique King, Nellyvette Mojica and Rosa Alverio, with conspiracy to commit theft of government money. Gist and King also are charged with wire fraud, aggravated identity theft and access device fraud. Mojica and Alverio also are charged with theft of government money.
According to the indictment, Gist and King used the means of identification of other individuals without their knowledge and consent in order to prepare and file false tax returns that claimed large tax refunds. The refund checks were mailed to addresses in the Chicago area or electronically deposited into bank accounts controlled by the defendants and others. After Mojica and Alverio received a number of the fraudulent refund checks into accounts under their control, they split the proceeds with Gist and King. From 2012 to 2015, the defendants and others received in excess of $1.3 million in fraudulent tax refunds.
If convicted, the defendants each face a statutory maximum sentence of five years in prison for the conspiracy count. Gist and King also face a statutory maximum sentence of 20 years in prison for wire fraud, 10 years in prison for access device fraud and a mandatory minimum sentence of two years in prison for each count of aggravated identity theft, which must run consecutive to any other sentence imposed by the court. Mojica and Alverio also face a statutory maximum sentence of 10 years in prison for the theft of government money counts. In addition, the defendants face potential fines, forfeiture and restitution.
An indictment merely alleges that crimes have been committed. A defendant is presumed innocent until proven guilty beyond a reasonable doubt.
Acting Assistant Attorney General Ciraolo commended special agents of IRS-Criminal Investigation, who investigated the case, and Trial Attorneys Ryan R. Raybould and Timothy M. Russo of the Tax Division, who are prosecuting this case.
Additional information about the Tax Division and its enforcement efforts may be found on the Division’s website.
Four Conspirators Indicted in Chicago-Based Stolen Identity Refund Fraud SchemeRead the Press Release
WASHINGTON – A federal grand jury sitting in Chicago, Illinois, returned an indictment, which was unsealed yesterday, charging four Chicago-area residents with conspiracy to commit theft of government money, wire fraud, theft of government money, aggravated identity theft and access device fraud, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney Zachary T. Fardon of the Northern District of Illinois.
The indictment charges ROXANN GIST, DOMINIQUE KING, NELLYVETTE MOJICA and ROSA ALVERIO with conspiracy to commit theft of government money. Gist and King also are charged with wire fraud, aggravated identity theft and access device fraud. Mojica and Alverio also are charged with theft of government money.
According to the indictment, Gist and King used the means of identification of other individuals without their knowledge and consent in order to prepare and file false tax returns that claimed large tax refunds. The refund checks were mailed to addresses in the Chicago area or electronically deposited into bank accounts controlled by the defendants and others. After Mojica and Alverio received a number of the fraudulent refund checks into accounts under their control, they split the proceeds with Gist and King. From 2012 to 2015, the defendants and others received in excess of $1.3 million in fraudulent tax refunds.
If convicted, the defendants each face a statutory maximum sentence of five years in prison for the conspiracy count. Gist and King also face a statutory maximum sentence of 20 years in prison for wire fraud, 10 years in prison for access device fraud and a mandatory minimum sentence of two years in prison for each count of aggravated identity theft, which must run consecutive to any other sentence imposed by the court. Mojica and Alverio also face a statutory maximum sentence of 10 years in prison for the theft of government money counts. In addition, the defendants face potential fines, forfeiture and restitution.
An indictment merely alleges that crimes have been committed. A defendant is presumed innocent until proven guilty beyond a reasonable doubt.
Acting Assistant Attorney General Ciraolo commended special agents of IRS-Criminal Investigation, who investigated the case, and Trial Attorneys Ryan R. Raybould and Timothy M. Russo of the Tax Division, who are prosecuting this case.
Additional information about the Tax Division and its enforcement efforts may be found on the Division’s website.
Former Youngstown man sentenced to more than three years in prison for bank fraud involving Mahoning County homesRead the Press Release
A former Youngstown man was sentenced to more than three years in prison for crimes related to the purchase of a dozen homes in Mahoning County, said Carole S. Rendon, Acting U.S. Attorney for the Northern District of Ohio, and Steven D. Anthony, Special Agent in Charge of the FBI’s Cleveland office.
R. Allen Sinclair, 52, of Suwanee, Georgia, was sentenced to 41 months in prison and ordered to pay approximately $830,000 in restitution. He pleaded guilty earlier this year to bank fraud.
Sinclair was the owner and operator of Newport Investments, LLC and Newport Development, Inc. in Youngstown. He advertised that the company was in the business of buying, renovating and selling residential real estate properties, according to court documents.
Sinclair, through his companies, solicited money from investors, promising them annual returns of about 10 percent and telling them their funds would be used for the acquisition and renovation of properties in Youngstown. Sinclair knew that the properties needed little or no renovation. Instead, he converted the money for his personal use, according to court documents.
Beginning in 2005, Sinclair acquired the 12 properties—in Youngstown, Canfield, Struthers and Austintown—through land trusts he created for each property. Sinclair fraudulently misled the sellers into believing the land trusts had assumed the mortgage payments. After making minimal monthly payments, Sinclair then stopped paying the mortgages and did not notify the sellers, who were unaware they were still obligated to the loans, according to court documents.
As a result, the properties went into foreclosure, causing substantial losses to the lenders and the federal agencies that insured them, according to court documents.
This case is being prosecuted by Assistant U.S. Attorneys Robert J. Patton and Suzana Krstevski Koch following an investigation by the Federal Bureau of Investigation, with assistance from the U.S. Department of Housing and Urban Development - Office of Inspector General and the Ohio Attorney General’s Office.
Former Rensselaer County Corrections Officer SentencedRead the Press Release
ALBANY, NEW YORK – Former Rensselaer County Corrections Officer Mark A. Piche, age 47, of Poestenkill, New York, was sentenced today to 1 year of probation and to pay a $5,000 fine for obstructing the administration of the internal revenue laws.
The announcement was made by United States Attorney Richard S. Hartunian; Shantelle P. Kitchen, Special Agent in Charge of the New York Field Office of IRS-Criminal Investigation; and New York State Police Superintendent George P. Beach II.
Piche pled guilty on September 9, 2013 to instructing employees of his restaurant, Red Front LLC in Troy, New York, to make false statements to Special Agents from IRS-Criminal Investigation, who were investigating the restaurant’s tax filings and payments.
Between 2007 and 2011, Piche caused Red Front to file false quarterly returns with the IRS. Those false returns underreported the payroll and employment taxes owed by Red Front as follows: $4,460.64 in 2007, $4,469.28 in 2008, $5,704.07 in 2009, $7,873.80 in 2010, and $6,777.75 in 2011. From December 15, 2011 through June 20, 2012, Piche instructed Red Front employees to state falsely to federal agents that Red Front had accurately reported and withheld taxes due on its employees’ wages.
As part of his sentence, issued by Senior U.S. District Judge Gary L. Sharpe, Piche must pay restitution in the amount of $29,285.54 to the U.S. Department of Treasury. In 2012, Piche was required to resign his position as a corrections officer with the Rensselaer County Sherriff’s Office, as a precondition to his entering into a plea agreement with the government.
This case was investigated by IRS-Criminal Investigation and the Albany Special Investigations Unit of the New York State Police, and was prosecuted by Assistant United States Attorney Jeffrey C. Coffman.
Former Rabobank Derivatives Trader Pleads Guilty for Scheme to Manipulate LIBOR BenchmarkRead the Press Release
A former Coöperatieve Centrale Raiffeisen-Boerenleebank B.A. (Rabobank) derivatives trader, who worked in Hong Kong and Singapore as the bank’s Head of Money Market and Derivatives Trading for Northeast Asia, pleaded guilty today to conspiracy to commit wire fraud and bank fraud for his role in a scheme to manipulate the London InterBank Offered Rate (LIBOR) to Rabobank’s advantage.
Assitant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Deputy Assistant Attorney General Brent Snyder of the Justice Department’s Antiturst Division and Assistant Director in Charge Paul M. Abbate of the FBI’s Washington Field Office made the announcement.
Paul Thompson, 50, of Dalkeith, Western Australia, pleaded guilty before U.S. District Judge Jed S. Rakoff of the Southern District of New York, who set sentencing for Nov. 9, 2016.
“Confidence in the integrity of our financial markets is critical to the stability of the U.S. economy,” said Assistant Attorney General Caldwell. “Trillions of dollars in derivative contracts, loans, consumer debt and other financial products are linked to LIBOR, but Thompson schemed to manipulate this important benchmark to advantage his bank’s own trading positions. This case demonstrates that we will work with our partners around the world to bring to justice those whose crimes threaten our financial markets, wherever they reside.”
“The defendant conspired to manipulate LIBOR, putting his interests above those who depend on LIBOR as a reliable, impartial reference rate,” said Deputy Assistant Attorney General Snyder. “The Antitrust Division will continue to work with our colleagues in the Criminal Division and the FBI to ensure that individuals who conspire to cheat or manipulate markets are held accountable for their crimes.”
“In today’s plea, a former Rabobank executive admitted to his role in conspiring to manipulate the LIBOR interest rate to his bank’s advantage,” said Assistant Director in Charge Abbate. “This multi-year investigation represents the ongoing effort of the FBI and its domestic and international law enforcement and regulatory partners to identify and stop those who commit complex financial crimes effecting the United States, no matter where they operate or reside.”
Thompson is the fourth individual to plead guilty in this matter: Paul Robson, Lee Stewart and Takayuki Yagami, former Rabobank traders, pleaded guilty to one count of conspiracy in connection with their roles in the scheme. Another former Rabobank employee, Tetsuya Motomura, of Tokyo, has been charged and awaits trial.
LIBOR is an average interest rate, calculated based on submissions from leading banks around the world, reflecting the rates those banks believe they would be charged if they borrowed from other banks. LIBOR serves as the primary benchmark for short-term interest rates globally and is used as a reference for many interest rate contracts, mortgages, credit cards, student loans and other consumer lending products. The Bank of International Settlements estimated that as of the second half of 2009, outstanding interest rate contracts tied to LIBOR were valued at approximately $450 trillion. At the time relevant to the charges, LIBOR was published by the British Bankers’ Association (BBA), a trade association based in London. LIBOR was calculated for 10 currencies at 15 borrowing periods, known as maturities. The published LIBOR “fix” for Yen and U.S. Dollar (USD) LIBOR at a specific maturity is the result of a calculation based upon submissions from a panel of 16 banks, including Rabobank.
According to admissions made in connection with his plea, Thompson traded derivative products tied to the USD and Japanese Yen LIBOR rates. In an effort to increase the profitability of his derivative positions, Thompson entered into a scheme with several other Rabobank employees to influence the rate to Rabobank’s advantage, he admitted. Electronic communications offered at Allen and Conti’s trial showed that Thompson schemed with Paul Robson, a former Rabobank trader responsible for submitting Rabobank’s Yen LIBOR rate to the BBA, and others, to make LIBOR submissions calculated to increase the profitability of Thompson’s derivatives positions. For example, on May 19, 2006, Thompson informed Robson that his net exposure to the three-month duration of the Yen LIBOR rate was 125 billion Yen and asked Robson to “sneak your 3m libor down a cheeky 1 or 2 [basis points] because “it will make a bit of diff for me.” On Nov. 8, 2006, Thompson wrote to Robson, “Got a few big 3mth fixings in next 2 days, any chance you cud bump [LIBOR] up a couple?” And on May 10, 2006, Robson informed another Rabobank submitter that, “for info I’ve been asked by my Singapore man [Thompson] to help him out with a silly low 6m fixing today.”
On Nov. 5, 2015, a federal jury in the Southern District of New York convicted Anthony Allen, formerly Rabobank’s Global Head of Liquidity and Finance, and Anthony Conti, formerly Rabobank’s primary U.S. Dollar LIBOR submitter, for their roles in the scheme. They were sentenced to 24 months and 12 months and a day in prison, respectively. On Oct. 29, 2013, Rabobank entered into a deferred prosecution agreement with the department and agreed to pay a $325 million penalty to resolve violations arising from Rabobank’s LIBOR submissions.
The FBI’s Washington Field Office is conducting the investigation. Senior Litigation Counsel Carol L. Sipperly and Assistant Chief Brian R. Young of the Criminal Division’s Fraud Section and Trial Attorney Michael T. Koenig of the Antistrust Division are prosecuting the case. The Criminal Division’s Office of Internaional Affairs has provided assistance in this matter.
The Justice Department expresses its appreciation for the assistance provided by various enforcement agencies in the United States and abroad. The Commodity Futures Trading Commission’s Division of Enforcement referred this matter to the department and, along with the U.K. Financial Conduct Authority, has played a major role in the LIBOR investigation. The Securities and Exchange Commission has also played a significant role in the LIBOR series of investigations and the department expresses its appreciation to the United Kingdom’s Serious Fraud Office for its assistance and ongoing cooperation. The department has worked closely with the Dutch Public Prosecution Service and the Dutch Central Bank in the Rabobank investigation. The department also thanked the Australian Attorney-General’s Department, the Australian Federal Police and the Western Australia Police for their assistance. Various agencies and enforcement authorities from other nations are also participating in different aspects of the broader investigation relating to LIBOR and other benchmark rates, and the department is grateful for their cooperation and assistance.
This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes. For more information about the task force visit www.stopfraud.gov.
Former Cumming Police Officer Charged with Accepting Bribe for Unlawfully Accessing a Law Enforcement DatabaseRead the Press Release
ATLANTA – Former Cumming, Georgia, Police Officer Nathan VanBuren has been arraigned after being charged with wire fraud and computer fraud.
“This former police officer allegedly used his position to access sensitive information in exchange for money,” said U. S. Attorney John Horn. “This type of conduct unfortunately impairs the hard work of the police as well as the community’s trust in law enforcement.”
“Investigations into allegations of public corruption involving police officers is a disheartening, but very necessary duty of the FBI. People have a right to demand that their public safety officers possess integrity and a sense of fairness as they carry out their duties. The FBI asks that anyone with information regarding such matters to contact their nearest FBI field office,” said J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office.
According to U.S. Attorney Horn, the charges, and other information presented in court: In July 2015, VanBuren, in his official capacity as a police officer, responded to a 911 call at a citizen’s home in Cumming, Georgia. The citizen was arrested. In July and August 2015, VanBuren and the citizen had additional communications. During those communications, VanBuren allegedly asked the citizen for a loan because his wages were being garnished and he had incurred financial debt due to his son’s medical and surgical expenses. In reality, VanBuren’s salary was not being garnished and his son was not ill. The citizen reported VanBuren’s actions and agreed to cooperate with law enforcement.
While cooperating with law enforcement, the citizen provided VanBuren $5,000 in response to VanBuren’s repeated requests for money. During that meeting, the citizen asked whether VanBuren would search a sensitive police database to determine whether an individual was an undercover police officer. In exchange for $1,000, VanBuren unlawfully accessed the law enforcement database and provided the results of that search to the citizen. VanBuren resigned before he was terminated by the Cumming Police Department.
Nathan VanBuren, 34, of Cumming, Georgia, was arraigned before United States Magistrate Judge Janet F. King. He was indicted by a federal grand jury on June 29, 2016.
Members of the public are reminded that the indictment only contains charges. The defendant is presumed innocent of the charges and it will be the government’s burden to prove the defendant’s guilt beyond a reasonable doubt at trial.
This case is being investigated by the Federal Bureau of Investigation. The Cumming Police Department and Forsyth County, Georgia, Sheriff’s Office assisted with the investigation.
Assistant United States Attorney Jeffrey Brown is prosecuting the case.
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.
Former Cumberland County Attorney Pleaded Guilty to Income Tax EvasionRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Karl E. Rominger, age 43, a former attorney in Carlisle, plead guilty today before United States District Court Judge Sylvia H. Rambo in Harrisburg to tax evasion and failure to file a federal tax return. Rominger was previously charged in June 2016.
According to United States Attorney Peter Smith, in 2012, Rominger attempted to evade federal income taxes due and owing for the calendar years 2006, 2007, 2008, 2009 and 2010, all years in which Rominger received taxable income. Rominger made false statements to agents of the Internal Revenue Service (IRS) concerning the location of his business operating accounts, with the intent to evade and defeat the actions of the IRS. Rominger also failed to file a federal income tax return for the calendar year 2012.
Pursuant to a plea agreement, Rominger agreed to pay restitution in the amount of $116,822.
The charges stem from an investigation by the Internal Revenue Service. The case is being prosecuted by Assistant United States Attorney Joseph J. Terz.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law is six years of imprisonment, a term of supervised release following imprisonment, and a $125,000 fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Former Bethel Resident Pleads Guilty to Distributing Heroin Involved in OverdoseRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that RYAN BUDD, 25, formerly of Bethel, waived his right to indictment and pleaded guilty today before U.S. District Judge Jeffrey A. Meyer in New Haven to one count of possession with intent to distribute, and distribution of, heroin.
This matter stems from an ongoing statewide initiative targeting narcotics dealers who distribute heroin, fentanyl or opioids that cause death or serious injury to users.
According to court documents and statements made in court, on March 1, 2016, at approximately 11:39 p.m., Danbury Police responded to a service station on the report of a woman in medical distress in a restroom. At the location, officers observed the victim on her knees, with her face on the floor, taking a deep gasping breath every 20 seconds. The victim also was holding a syringe.
The victim was transported to the hospital, where she was placed on life support. She has since recovered from the overdose.
At the service station, officers collected various items as evidence, including a second syringe, three “folds” of heroin and two cell phones.
The investigation identified BUDD as the heroin source of supply in this overdose case.
BUDD was arrested on March 9, 2016, and is released on a $100,000 bond. He currently resides in Branford.
Judge Meyer scheduled sentencing for September 29, 2016, at which time BUDD faces a maximum term of imprisonment of 20 years.
This investigation is being conducted by the Drug Enforcement Administration’s New Haven Tactical Diversion Squad, the Danbury Police Department and the Wilton Police Department. The Task Force includes participants from the New Haven, Hamden, Greenwich, Shelton, Bristol, Vernon, Wilton, Milford, Monroe, Fairfield and Middlebury Police Departments, and the Connecticut State Police. The case is being prosecuted by Assistant U.S. Attorney Douglas P. Morabito.
Florida Investment Adviser Charged with Defrauding Clients of Almost $800,000Read the Press Release
An Indictment[1] was unsealed today charging Sean Donald Premock, 43, of Ft. Lauderdale, Florida, with nine counts of mail fraud, nine counts of wire fraud, one count of securities fraud, and one count of investment adviser fraud, announced United States Attorney Zane David Memeger.
The indictment alleges that Premock, a Florida stockbroker and investment adviser who started his own investment and financial planning companies after being fired by his previous employer for selling investments that were not approved by his employer, used his companies to defraud clients, most of whom were elderly, convincing the clients to invest with him by promising to invest their money in stocks, bonds, annuities, hedge funds, and “safe” investments, while in reality Premock spent most of their money on himself and used some of the money to pay other clients. The indictment further alleges that Premock continued to hold himself out as a stock broker and investment adviser even after his licenses were suspended and after he was permanently barred by FINRA from working as a stock broker or otherwise associating with a firm that sold securities to the public, and that he failed to disclose the suspension and permanent bar to his clients.
Premock faces a maximum sentence of 385 years’ imprisonment, a five-year period of supervised release, a $9,510,000 fine, and a $2,000 special assessment, and a likely advisory sentencing guideline range of 87 – 108 months’ imprisonment.
The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Michael S. Lowe.
[1] An Indictment or Information is an accusation. A defendant is presumed innocent unless and until proven guilty
Final Defendant Scheduled for Second Gang Trial Pleads Guilty to Racketeering ConspiracyRead the Press Release
COLUMBUS, Ohio – Thomas A. Coates, 30, formerly of Columbus, pleaded guilty in U.S. District Court today to one count of racketeering conspiracy. Coates was originally scheduled to stand trial with Lance Green, who also pleaded guilty, on July 11 in the second of three trials involving the organized criminal enterprise known as the Short North Posse.
Benjamin C. Glassman, Acting United States Attorney for the Southern District of Ohio, Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Timothy J. Plancon, Special Agent in Charge, Drug Enforcement Administration (DEA), Brad Earman, Acting Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Franklin County Prosecutor Ron O’Brien and Columbus Police Chief Kim Jacobs announced the plea entered into today before U.S. District Judge Algenon L. Marbley.
A total of 20 individuals were indicted in the racketeering case with charges that included murders, attempted murders, drug trafficking, weapons offenses, witness tampering, extortion and robbery.
A United States District Court jury convicted five co-defendants of racketeering and murder earlier this month. After a two-month trial, the group of defendants was convicted on all counts, which accounted for 10 of 14 previously unsolved murders.
A final trial is currently scheduled to begin on September 26 for the remaining defendants.
Racketeering conspiracy is a crime punishable by up to 20 years in prison.
Acting U.S. Attorney Glassman commended the two-year long investigation by federal, state and local law enforcement agencies, including the FBI, DEA, ATF, Columbus Police, Franklin County Sheriff Zach Scott’s Office, Franklin County Prosecutor Ron O’Brien’s Office, Fairfield County Prosecutor Gregg Marx, Licking County Prosecutor Kenneth Oswalt, Muskingum County Prosecutor D. Michael Haddox, Ross County Prosecutor Matthew S. Schmidt, law enforcement leaders from those counties, officials of the Ohio Department of Rehabilitation and Correction, as well as Assistant U.S. Attorneys David DeVillers, Kevin Kelley and Brian Martinez, and Special Assistant U.S. Attorney Jimmy Lowe of Franklin County Prosecutor O’Brien’s Office, who are prosecuting the case.
Felon Pleads Guilty to Unlawful Possession of FirearmRead the Press Release
BOISE – Donovan Langford, 45, of California, pleaded guilty yesterday to unlawful possession of a firearm, U.S. Attorney Wendy J. Olson announced. Donovan was indicted by a federal grand jury in Boise on March 8, 2016.
According to the plea agreement, on February 1, 2016, Donovan knowingly possessed a twenty-gauge shotgun while in McCall, Idaho. Langford was prohibited from possessing firearms due to a 2004 burglary conviction in California.
The charge of unlawful possession of a firearm is punishable by up to ten years in prison, a maximum fine of $250,000, three years supervised release and a $100 special assessment.
Sentencing is set for October 4, 2016, before Senior United States District Judge Edward J. Lodge, at the federal courthouse in Boise.
The case was investigated by the Idaho State Police, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Drug Enforcement Administration as well as the Organized Crime and Drug Enforcement Task Force (OCDETF) which includes the cooperative law enforcement efforts of the Federal Bureau of Investigation; Drug Enforcement Administration; Bureau of Alcohol, Tobacco, Firearms and Explosives; U. S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Internal Revenue Service-Criminal Investigation; and U.S. Marshals Service. The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations.
Federal Grand Jury Adds Defendant and Murder Charge to Indictment Against Bandidos Outlaw Motorcycle Organization LeadershipRead the Press Release
In San Antonio, a federal grand jury has returned a superseding indictment against the highest ranking leaders of the Bandidos Outlaw Motorcycle Organization (OMO) adding a murder charge and a new defendant to the federal racketeering indictment returned in January.
That announcement was made today by United States Attorney Richard L. Durbin, Jr., Western District of Texas; Drug Enforcement Administration (DEA) Special Agent in Charge Joseph M. Arabit, Houston Division; Federal Bureau of Investigation Special Agent in Charge Christopher Combs, San Antonio Division; Texas Department of Public Safety Director Steve McCraw; and San Antonio Police Chief William McManus.
The superseding indictment, unsealed this morning in San Antonio, incorporates the charges contained in the original federal grand jury indictment against Bandidos National President Jeffrey Fay Pike, National Vice President John Xavier Portillo and National Sergeant at Arms Justin Cole Forster. Pike, age 60 of Conroe, TX; Portillo, age 56 of San Antonio; and, Forster, age 31 of San Antonio are accused of directing, sanctioning, approving and permitting other members of the organization to carry out racketeering acts including murder, attempted murder, assault, intimidation, extortion and drug trafficking to protect and enhance the organization’s power, territory, reputation and profits.
According to the superseding indictment, the Bandidos OMO declared it was “at war” with the Cossacks OMO. The superseding indictment specifically alleges a number of violent acts committed by Bandidos OMO members in furtherance of this “war.” The superseding indictment also alleges that Portillo, Forster and other members of the Bandidos OMOM were engaged in trafficking methamphetamine and cocaine and maintained an agreement with the Texas Mexican Mafia wherein Bandidos OMO members were not required to pay the 10-percent “dime” to the Texas Mexican mafia in exchange for permission to traffic narcotics.
The superseding indictment also alleges that Portillo and Southwest San Antonio Chapter member Frederick Cortez (aka “Fast Fred”) were involved in the retaliation murder of Robert Lara in January 2002 in Atascosa County for killing one of their own. Javier Negrete, a member of the same Bandidos OMO chapter as Portillo and Cortez, was killed outside a San Antonio bar in October 2001. Federal authorities arrested Cortez yesterday.
Pike, Portillo and Forster are charged with one count of conspiracy to violate the Racketeering Influenced Corrupt Organization (RICO) statute; one count of conspiracy to commit violent crimes in aid of racketeering (VICAR); and, one count of conspiracy to interfere with commerce by extortion.
Portillo is also charged with three substantive VICAR counts, plus one count of conspiracy to possess with intent to distribute methamphetamine and cocaine; one count of possession with intent to distribute cocaine; and, one count of felon in possession of a firearm. Forster is also charged with one count of conspiracy to possess with intent to distribute methamphetamine and cocaine; and, two counts of possession with intent to distribute methamphetamine. Cortez is charged with one substantive VICAR count.
Portillo, Forster and Cortez remain in federal custody. Pike is currently out on bond pending trial. Jury selection is currently scheduled for October 11, 2016. Upon conviction, the defendants face up to life in federal prison.
This ongoing investigation is being conducted by the FBI, DEA and Texas DPS together with the Internal Revenue Service-Criminal Investigation, U.S. Customs and Border Protection, New Braunfels Police Department, Seguin Police Department, San Antonio Police Department, Bexar County Sheriff’s Department, Atascosa County Sheriff’s Department, and the Bexar County District Attorney’s Office. Assistant United States Attorneys Eric J. Fuchs and Joey Contreras are prosecuting this case on behalf of the Government.
It is important to note that an indictment is merely a charge and should not be considered as evidence of guilt. The defendants are considered innocent until proven guilty in a court of law.
Dallas Woman Pleads Guilty to Indictment - Admits Making Harassing Phone Calls to University and Municipal Police DepartmentsRead the Press Release
DALLAS — A Dallas woman appeared in federal court this morning and pleaded guilty before U.S. Magistrate Judge Paul D. Stickney to a three-count indictment alleging she made harassing telephone calls to university and municipal police departments throughout the U.S. and Canada to falsely report she was a purported victim or purportedly injured, announced U.S. Attorney John Parker of the Northern District of Texas.
Tameira Janell Smith, 23, of Dallas, pleaded guilty to three counts of making harassing telephone calls. She faces a maximum statutory penalty of two years in federal prison and a $250,000 fine for each count. Restitution could also be ordered. Sentencing is set for October 21, 2016, before Chief U.S. District Judge Barbara M. G. Lynn.
Smith, who is now in custody, was arrested on October 13, 2015, and she was released on supervised pretrial release. On June 24, 2016, the government filed a motion for detention and a hearing was held on June 30, 2016. The court found she had violated her conditions of pretrial release by committing a crime while on release.
According to the order entered after that hearing, Smith was required to obtain mental health treatment and to not commit any new crimes as part of the conditions for her release. At that hearing, however, an emergency room nurse testified that in early June 2016 she was asked to assist two other nurses with an uncooperative and difficult patient, Smith, who was about to be admitted. Smith refused to change into the hospital scrubs as required for admission, and based on her conduct, the hospital’s police department was contacted. As the nurses tried to change her clothes, and when this nurse removed Smith’s headband, Smith struck this witness nurse in the chest, injuring her and causing her to lose her balance. Smith was then found to have a razor blade hidden in her hair. Smith has been charged at the state for assaulting the nurse.
The detention order further states that Smith has been in and out of treatment several times during her pretrial release, and her behavior as described by the nurse witness at the hearing is consistent with the testimony at Smith’s initial detention hearing in October 2015. The detention order further states that Smith continued to place first responders and medical personnel at risk.
According to the indictment and factual resume filed in the case, from approximately May 7, 2015, and continuing to approximately October 1, 2015, Smith made a series of at least 15 contacts with university and municipal police departments falsely in the U.S. and Canada reporting she was a purported victim, or purportedly injured. She would not give her name or even provide a false name when contacting police. Upon receiving the calls, the police departments responded as if a true emergency existed by deploying emergency personnel and vehicles, including police cruisers, fire trucks, and ambulances.
Many times, Smith was not injured nor even in the area where she reported the false emergencies to police dispatchers. In some of the later instances, however, Smith staged a scene, called police, and waited for emergency personnel to arrive.
Throughout the scheme, Smith used a telecommunications device and software that allowed her to transmit originating phone numbers that were not her own, thereby concealing her identity and location.
The FBI is investigating the case. Assistant U.S. Attorney Lori Walker is in charge of the prosecution.
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Covington Man Pleads Guilty to Illegally Possessing a Firearm, Transporting Stolen FirearmsRead the Press Release
ROANOKE, VIRGINIA – A previously convicted felon, who under federal law is prohibited from possessing a firearm, pled guilty today in federal court to breaking into a federally licensed firearms dealer and stealing two dozen firearms with hopes of later selling them, United States Attorney John P. Fishwick Jr. announced today.
David Christopher Martin, 40, of Covington, Va., pled guilty today in the United States District Court for the Western District of Virginia in Roanoke to one count of being a previously convicted felon illegally in possession of a firearm and one count of transporting one or more stolen firearms in interstate commerce from Virginia to South Carolina.
According to evidence presented at today’s hearing by United States Attorney Fishwick, Martin admitted that on or about April 4, 2016 he used a rock to break the glass of the front door of Mountain Top Hunting and Fishing, a federally licensed firearms dealer located in Covington, Va. After breaking the glass of the front door, Martin entered the store through the broken window. Martin admitted that prior to the burglary he “cased” the business, examining the layout, inventory and security. To make his escape easier, he disassembled part of a fence at the rear of the store. Additionally, Martin purchased a set of wire cutters to disable what he believed to be part of the alarm system.
Once inside the store, Martin used the wire cutters to break the glass of a display cabinet where handguns were on display. He took what he thought to be the most valuable handguns and put them into a red bag and left the store with 24 handguns. Martin later admitted he planned to sell the handguns for approximately $6,000 and split the money with his girlfriend.
Early on the morning of April 4, 2016, Martin got into a van with co-worker to travel to Florida for a pressure washing job at a paper mill, taking the guns with him in the red bag. At one point during the trip, the driver of the van told Martin if he had anything illegal in the van he needed to get rid of it. At a rest stop near Yemassee, South Carolina, Martin got out of the van and hid the guns in the nearby woods, taking a picture of a unique tree near where he hid the guns, which were later recovered by federal agents.
The investigation of the case was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives offices in Roanoke, Virginia, Charleston, South Carolina and Jacksonville, Florida, the Covington Police Department, the Allegheny County Sheriff’s Office, the Bloomingdale, Georgia Police Department, Colleton County Sheriff’s Office in South Carolina and the Nassau County Florida Sheriff’s Office. United States Attorney John P. Fishwick Jr. and Assistant United States Attorney Anthony P. Giorno prosecuted the case for the United States.