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24 August 2016
Former Owner of Preserve Financial Group Pleads Guilty in Insurance Fraud SchemeRead the Press Release
John O. Wilson, 53, of Antioch, Tenn., pleaded guilty today to two counts of wire fraud, in connection with a fraudulent insurance/investment scheme, announced David Rivera, United States Attorney for the Middle District of Tennessee.
At a plea hearing before Chief U.S. District Judge Kevin H. Sharp, Wilson admitted that from August 2005 to November 2014, he devised and engaged in a scheme to defraud and obtain money from his clients and various insurance agencies by making material false representations and using interstate wires to further his scheme. During this period of time, Wilson, a licensed insurance provider in Tennessee, was the owner and operator of an insurance agency known as Preserve Financial Group, Inc. (“PFG”) located in the metropolitan Nashville area. Wilson admitted to operating his fraudulent scheme in at least three ways:
First, in order to obtain increased commissions, Wilson would advise clients to remove their money from their existing tax-deferrable investments and purchase multiple insurance policies. In doing so, Wilson would not disclose to his clients the consequences of the repeated investments including adverse tax consequences and substantial surrender charges.
Second, Wilson would convince some clients to surrender insurance policies or annuities to him for investment in another insurance policy or annuity. Instead of investing the money as promised, Wilson would cause these funds to be deposited into the PFG bank account he controlled, and he would then use the funds primarily for his own benefit.
Third, Wilson would convince some clients to surrender insurance policies or annuities by deceiving them into believing they were investing in PFG by purchasing stock in the company. In truth, there was no such stock and instead, the money was deposited into the PFG account, which was then used primarily for Wilson’s own personal benefit.
Wilson faces up to 20 years in prison on the wire fraud charges. He also faces a criminal fine of up to $250,000, forfeiture of criminal proceeds, and he will be ordered to pay restitution to the victims. Wilson will be sentenced by Chief Judge Sharp on November 23, 2016. His sentence will be imposed by the Court after consideration of the U.S. Sentencing Guidelines and applicable federal statutes.
The case was investigated by the Federal Bureau of Investigation. The United States is represented by Assistant U.S. Attorneys Sandra G. Moses and Thomas J. Jaworski.
Former Marriott employee pleads guilty to wire fraud for embezzling close to $1 millionRead the Press Release
Defendant embezzled the funds over roughly 10 years and spent the money on island vacations and cars
CHARLESTON, W.Va. – A former employee of the Charleston Marriott Town Center who defrauded the hotel out of close to a million dollars pleaded guilty today, announced United States Attorney Carol Casto. Mark Kuhn, 52, of Milton in Cabell County, entered his guilty plea to wire fraud for his embezzlement from the hotel.
Kuhn worked for the Marriott as an accountant and general cashier. His duties included collecting cash from the various departments of the hotel, including the gift shop, the front desk, and the restaurant and bar. Kuhn admitted that beginning in November 2005 and continuing through February 2016, he embezzled over $955,000 from the hotel. He covered up his embezzlement by regularly posting false entries in the hotel’s accounting system to make it appear as if the hotel had paid out cash for various goods or services. Typically, the false entries reflected fictitious payments for commissions or fees owed to a travel agency or online travel company. The false entries for any particular day would match the amount of cash that Kuhn had embezzled from the cash receipts for that day.
Over the course of his fraudulent scheme, Kuhn used the embezzled funds for personal expenses. He admitted that he took vacations to Hawaii, the Bahamas, Myrtle Beach, and Disney World. He also admitted that he went on a cruise to Cozumel, Mexico. He additionally admitted to using the money to buy cars, a truck, and a recreational vehicle. Furthermore, he admitted that he used the embezzled funds to make payments on Chase MasterCard accounts, Sears credit card accounts, and a revolving credit account at Home Depot.
Kuhn faces up to 20 years in federal prison when he is sentenced on December 5, 2016. Additionally, as part of the plea agreement, Kuhn has agreed to pay $955,317.17 in restitution.
The United States Secret Service conducted the investigation. Assistant United States Attorney Philip H. Wright is in charge of the prosecution. The plea hearing was held before United States District Judge Thomas E. Johnston.
Former High School Teacher Pleads Guilty to Possessing Child PornRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a former Independence, Mo., high school teacher pleaded guilty in federal court today to possessing child pornography.
Jason R. Pink, 44, of Independence, waived his right to a grand jury and pleaded guilty before U.S. District Judge Brian C. Wimes to a federal information that charges him with possessing child pornography in 2014.
At the time of the offense, Pink was employed as a teacher at Fort Osage High School. He was identified as a customer during an investigation into a movie production company located outside the United States that operated a Web site advertising child pornography DVDs and streaming videos for sale. Law enforcement officers seized hundreds of DVDs from the business and found information in the company’s records that Pink had purchased child pornography on multiple occasions.
U.S. Postal Inspectors executed a search warrant at Pink’s residence and located several child pornography DVDs that he had purchased from the company. Inspectors also located a 16-gigabyte thumb drive inserted into a computer tower that included thousands of “naturist” or “nudist” type images that are not necessarily child pornography but which include nude minors from the age of approximately 12 to 18 years. Also included in this thumb drive were approximately 30 images of child pornography.
Under federal statutes, Pink is subject to a sentence of up to 10 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 David Luna. It was investigated by the U.S. Postal Inspection Service.
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."
Former Background Investigator for Federal Government Pleads Guilty to Making a False StatementRead the Press Release
WASHINGTON – Edward J. Kincade, 63, a former background investigator who did work under contract for the U.S. Office of Personnel Management (OPM), pled guilty today to a charge stemming from his falsification of work on background investigations of federal employees and contractors, announced U.S. Attorney Channing D. Phillips and Norbert E. Vint, Acting Inspector General for the Office of Personnel Management.
Kincade, of Guyton, Ga., pled guilty in the U.S. District Court for the District of Columbia to making a false statement. The Honorable Randolph D. Moss scheduled sentencing for Nov. 9, 2016. The charge carries a statutory penalty of up to five years in prison and a fine of up to $250,000. As part of the plea, Kincade has agreed to pay $264,312 in restitution to the federal government.
According to a statement of offense submitted to the Court, Kincade was employed by USIS, formerly known as U.S. Investigations Services Inc., as an investigator under contract to conduct background investigations on behalf of OPM’s Federal Investigative Services.
Between August 2011 and September 2012, in more than 30 Reports of Investigations on background investigations, Kincade represented that he had interviewed a source or reviewed a record regarding the subject of the background investigation. In fact, he had not conducted the interviews or obtained the records of interest. These reports were utilized and relied upon by the agencies requesting the background investigations to determine whether the subjects were suitable for positions having access to classified information, for positions impacting national security, for receiving or retaining security clearances, or for positions of public trust.
Kincade’s false representations have required Federal Investigative Services to reopen and rework numerous background investigations that were assigned to him during the time period of his falsifications, at an estimated cost of at least $264,312 to the U.S. government.
Federal Investigative Services has a robust integrity assurance program which utilizes a variety of methods to ensure the accuracy of reported information. The falsification of investigative case work by the defendant was detected through the program.
This is one of numerous cases prosecuted by the U.S. Attorney’s Office for the District of Columbia since 2008 involving false representations by background investigators and record checkers working on federal background investigations. In addition to Kincade, 22 other background investigators and two record checkers have been convicted of charges.
Federal Investigative Services, through its workforce of approximately 5,400 field investigators, is responsible for conducting background investigations for numerous federal agencies and their contractors, on individuals either employed by or seeking employment with those agencies or contractors. Federal Investigative Services conducted more than 2.4 million investigations during the 2015 fiscal year. More than 600,000 of these investigations involved applicants for access or continued access to classified information.
In performing background investigations, the investigators conduct interviews of individuals who have information about the person who is the subject of the review. In addition, the investigators seek out, obtain, and review documentary evidence, such as employment records, to verify and corroborate information provided by either the subject of the background investigation or by persons interviewed during the investigation. After conducting interviews and obtaining documentary evidence, the investigators prepare a Report of Investigation containing the results of the interviews and document reviews, and electronically submit the material to OPM in Washington, D.C. OPM then provides a copy of the investigative file to the requesting agency, which can use the information to determine an individual’s eligibility for employment or a security clearance.
In announcing the plea, U.S. Attorney Phillips and Acting Inspector General Vint praised the efforts of Special Agent Shantel Robinson, OPM, Office of the Inspector General, and Philip Kroop, Kevin Cassidy, and Jeffrey Addicks, OPM, Federal Investigative Services. They also acknowledged the work of Paralegal Specialist Julie Dailey of the U.S. Attorney’s Office, as well as Assistant U.S. Attorney Ellen Chubin Epstein, who investigated and prosecuted this matter.
Former APS Kindergarten Teacher Pleads Guilty to Federal Child Pornography ChargesRead the Press Release
ALBUQUERQUE – Joshua Weitz, 39, of Albuquerque, N.M., pleaded guilty today in federal court to possession of child pornography charges. Under the terms of his plea agreement, Weitz will be sentenced within the range of 24 to 151 months in prison followed by 15 years of supervised release. Weitz will be required to register as a sex offender when he completes his prison sentence. Additionally, Weitz will be required to pay restitution in the amount of $1,000 to any victim associated with the charges against Weitz who requests restitution before Weitz’s sentencing hearing.
Weitz was arrested Nov. 11, 2015, on a federal criminal complaint alleging that he distributed, received and possessed visual depictions of minors engaged in sexually explicit conduct in Oct. 2015, in Bernalillo County. At the time Weitz committed the offenses, he was employed as a kindergarten teacher by the Albuquerque Pubic Schools (APS). APS suspended Weitz’s employment following his arrest in early Nov. 2015, on related state charges and subsequently terminated his employment.
According to the criminal complaint, the investigation into Weitz began on Oct. 11, 2015, when an agent of the New Mexico Internet Crimes Against Children (ICAC) Task Force identified a computer with an IP address, later determined to be subscribed to Weitz that was being used to share child pornography files. Between Oct. 11, 2015 and Oct. 22, 2015, investigators downloaded numerous of child pornography files from the computer at Weitz’s IP address. On Nov. 4, 2015, a state court search warrant was executed at Weitz’ residence and ICAC Task Force agents found that Weitz possessed a computer containing numerous files of child pornography. Weitz was arrested that day on related state charges, which were later dismissed in favor of federal prosecution.
Weitz was indicted on Dec. 2, 2015, and was charged with four counts of distribution of child pornography and two counts of possession child pornography from Dec. 14, 2014 through Nov. 4, 2015 and Feb. 4, 2013 through Nov. 4, 2015. According to the indictment, Weitz distributed child pornography on for occasions in Oct. 2015 and possessed child pornography between Feb. 2013 and Nov. 2015.
During today’s proceedings, Weitz pled guilty to Counts 4 and 5 of the indictment, the two possession of child pornography charges. In entering the guilty plea, Weitz admitted from Feb. 4, 2013 through Nov. 4, 2015, he downloaded videos and images of child pornography from the internet and saved them on two computers. One computer contained approximately 250 images and 358 videos of child pornography. The other computer contained approximately 34 images and 77 videos of child pornography.
A sentencing hearing for Weitz has yet to be scheduled.
This case was investigated by the New Mexico ICAC Task Force, the Bernalillo County Sheriff’s Office, the Albuquerque office of the FBI and the New Mexico Regional Computer Forensics Laboratory with assistance from the New Mexico Office of the Attorney General. Assistant U.S. Attorney Sarah Mease is prosecuting the case as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice (DOJ) to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and DOJ’s Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
The case also was brought as a part of the New Mexico ICAC Task Force’s mission, which is to locate, track, and capture Internet child sexual predators and Internet child pornographers in New Mexico. There are 82 federal, state and local law enforcement agencies associated with the New Mexico ICAC Task Force, which is funded by a grant administered by the Office of the New Mexico Attorney General. Anyone with information relating to suspected child predators and suspected child abuse is encouraged to contact federal or local law enforcement.
Florida Resident Convicted in Wire Fraud Scheme Involving $1.3 MillionRead the Press Release
BATON ROUGE, LA –United States Attorney Walt Green announced THOMAS J. TANNER, JR., age 50, of Destin, Florida, pled guilty before U.S. District Judge John W. deGravelles to identity theft, in violation of Title 18, United States Code, Section 1028. During the guilty plea hearing, TANNER, a former Project Manager of ISC Constructors, LLC, admitted to using the signature, name, and position of another individual relating to a scheme to defraud his former employer, ISC, along with Chevron U.S.A., Inc., of approximately $1,300,000, which was used to pay himself and others inflated rates for approximately 1 year.
U.S. Attorney Green stated: “Unfortunately, corporate fraud schemes continue to be employed by criminals both in the United States and worldwide. Moreover, the high-speed nature of communications today has allowed corporate executives to, at times, transmit fraudulent documents via e-mail, with the belief that the documents will be quickly reviewed and approved, and the underlying fraudulent scheme never discovered. This case is another example of my office working in conjunction with the FBI to aggressively identify and prosecute those engaged in identity theft and corporate fraud, as such criminal conduct results in the loss of significant corporate funds and corporate integrity.”
FBI Special Agent-in-Charge Jeffrey S. Sallet stated: “The FBI New Orleans Division will continue to investigate allegations of identity theft and similar white collar crimes that defraud Louisiana employers and residents.”
This ongoing investigation is being conducted by the Federal Bureau of Investigation and prosecuted by Assistant United States Attorney Paul L. Pugliese.
Five Men Indicted on Federal Bank Robbery ChargesRead the Press Release
HARRISBURG – The United States Attorney’s Office for the Middle District of Pennsylvania announced today that a federal grand jury in Harrisburg has returned two indictments against five men in connection with bank robberies near York and Lebanon.
According to U.S. Attorney Peter Smith, Derek Pelker, age 26, Wernersville, Ryan Miller, a/k/a “Otis,” age 24, Robinson Township, and Andrew Ishman, age 31, Wrightsville, were indicted for conspiracy, armed bank robbery, and possession of a firearm in furtherance of a crime of violence in relation to the robbery of the Susquehanna Bank (now the BB&T Bank), in East Prospect on April 24, 2015. Pelker and Miller are also charged with possessing firearms as convicted felons.
The grand jury also returned a separate indictment charging Derek Pelker, his brother, Keith Pelker, age 27, Wernersville, and Shannon Gadzouris, age 23, Shillington, with conspiracy and armed bank robbery in relation to the robbery of the M&T Bank in Lebanon on April 5, 2016. According to the indictment, the defendants used a CO2 gun which appeared to be a firearm to commit that robbery.
The investigation was conducted by the Federal Bureau of Investigation Capital City Violent Crimes Task Force, the Pennsylvania State Police, the South Lebanon Township Police Department, the U.S. Marshals Fugitive Task Force, and the Lebanon and York County District Attorney’s Offices. The Capital City Violent Crimes Task Force consists of representatives from the FBI’s Harrisburg Field Office and the Harrisburg Police Department. The case is being prosecuted by Assistant U.S. Attorney Scott R. Ford.
This case was also brought as part of the Violent Crime Reduction Partnership (“VCRP”), a district wide initiative to combat the spread of violent crime in the Middle District of Pennsylvania. Led by the United States Attorney’s Office, the VCRP consists of federal, state and local law enforcement agencies whose mission is to locate, apprehend, and prosecute individuals who commit violent crimes.
Indictments are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty for the offenses related to the East Prospect robbery is life imprisonment, a term of supervised release following imprisonment, and a fine. The maximum penalty for the offenses related to the Lebanon robbery is 25 years imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Federal Grand Jury Returns Indictment Charging Jesse Denver Hanes, Alleged Shooter of Hatch Police Officer, with Federal Firearms and Carjacking OffensesRead the Press Release
ALBUQUERQUE – A federal grand jury sitting in Albuquerque, N.M., has returned an indictment charging Jesse Denver Hanes with federal firearms and carjacking offenses arising out of an Aug. 12, 2016, traffic stop in Hatch, N.M., during which Hanes allegedly shot and killed Hatch Police Officer Jose Chavez and Hanes’ efforts to evade arrest following the shooting. Hanes was arraigned on the indictment this morning in federal court in Las Cruces, N.M., and entered a not guilty plea. Following the arraignment hearing, a U.S. Magistrate Judge ordered that Hanes be detained pending trial after finding that he poses a risk of flight and danger to the community.
The filing of the federal indictment was announced by U.S. Attorney Damon P. Martinez and Special Agent in Charge Terry Wade of the FBI’s Albuquerque Division. Joining them in making the announcement were Third Judicial District Attorney Mark D’Antonio, Chief James Gimler of the Hatch Police Department, Chief Pete N. Kassetas of the New Mexico State Police, and Doña Ana County Sheriff Enrique Vigil.
The five-count indictment, which was filed late yesterday afternoon, charges Hanes, 38, a resident of Columbus, Ohio, with attempted carjacking; brandishing a firearm during a crime of violence; carjacking resulting in serious bodily injury; discharging a firearm during a crime of violence; and being a felon in possession of a firearm. It alleges that Hanes committed these crimes on Aug. 12, 2016, in Doña Ana County, N.M. At the time, Hanes was prohibited from possessing firearms or ammunition because of his status as a convicted felon.
Hanes was arrested Aug. 16, 2016, on a federal criminal complaint charging him with being a felon in possession of a firearm, carjacking, and discharging a firearm during a crime of violence. The criminal complaint alleged that, on Aug. 12, 2016, Officer Chavez executed a traffic stop in Hatch, N.M., on a Lexus driven by Hanes and in which two other men were passengers. During the traffic stop, Hanes allegedly shot Officer Chavez in the upper torso; Officer Chavez later died as a result of the gunshot wound.
The criminal complaint also alleged that after fleeing from the scene of the shooting in the Lexus, Hanes and his passengers parted company. Thereafter, Hanes stopped at a rest area near Radium Springs, N.M., where he allegedly shot a motorist, causing him to suffer serious bodily injury, and carjacked the motorist’s vehicle, a Chevrolet. When deputies of the Doña Ana County Sheriff’s Office arrested Hanes, they allegedly found a handgun, believed to be the firearm used to shoot Officer Chavez and the motorist, in the Chevrolet.
The indictment adds two new crimes not previously charged in the criminal complaint: an attempted carjacking charge and a new firearms offense. The new charges allege that Hanes used force and violence against two victims while attempting to carjack the victims’ vehicle and that Hanes brandished a firearm during the attempted carjacking.
In addition to the charges in the federal indictment, Hanes has been charged with the first-degree murder of Officer Chavez in a criminal complaint filed in the Third Judicial District Court for the State of New Mexico in Doña Ana County. The state’s murder investigation is continuing. Hanes also is facing an unrelated murder charge in Ohio.
If convicted of the crimes charged in the federal indictment, Hanes faces a statutory maximum penalty of ten years in prison for unlawfully possessing a firearm; 15 years on the attempted carjacking charge, and 25 years in prison on the carjacking charge. If convicted of brandishing a firearm during the attempted carjacking, Hanes faces a statutory mandatory minimum penalty of seven years in prison. He also faces a statutory mandatory minimum penalty of 25 years in prison if convicted of discharging a firearm during the carjacking. The 32 years must be served consecutive to any sentence imposed on the other charges. These potential penalties apply only to the federal charges and are beyond any penalties that may be imposed under state laws. Charges in indictments and criminal complaints are merely accusations, and criminal defendants are presumed innocent unless proven guilty beyond a reasonable doubt.
The case was investigated by the Las Cruces office of the FBI, Hatch Police Department, Doña Ana County Sheriff’s Office and New Mexico State Police, with assistance from the 3rd Judicial District Attorney’s Office. The following agencies also assisted in the investigation: Albuquerque and El Paso offices of the FBI, ATF, DEA, U.S. Marshals Service, Homeland Security Investigations, U.S. Border Patrol, Las Cruces Police Department, El Paso (Texas) County Sheriff’s Office and El Paso (Texas) Police Department.
Assistant U.S. Attorneys Aaron O. Jordan and Marisa A. Ong of the U.S. Attorney’s Las Cruces Branch Office are prosecuting the case as part of a federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders primarily based on their felony conviction records for federal prosecution with the goal of removing violent, repeat offenders from communities in New Mexico for as long as possible.
Hanes Indictment
Fair Haven Man Pleads Guilty to Making Hoax Emergency Calls to U.S. Coast GuardRead the Press Release
BOSTON – A Fair Haven man pleaded guilty yesterday in U.S. District Court in Boston in connection with sending three false distress messages to the U.S. Coast Guard over the radio.
Roger Martin, 47, of Fair Haven, Mass., pleaded guilty to an Information charging him with three counts of sending false distress messages to the U.S. Coast Guard and one count of identity fraud. U.S. District Court Judge Richard G. Stearns scheduled sentencing for Nov. 22, 2016.
In April and May 2015, Martin made three calls to the U.S. Coast Guard claiming that he was on a boat on Cape Cod Canal that was sinking. During each call, Martin impersonated another resident of Fair Haven and provided that resident’s name, street address and, on one occasion, date of birth. Martin obtained the date of birth by improperly using a law enforcement database when he was previously employed as a Bristol Sheriff’s County dispatcher. In response to the calls, the U.S. Coast Guard and local law enforcement expended resources ascertaining that there was no true emergency and attempting to track the hoax caller.
The charge of sending false distress messages provides for a sentence of no greater than six years in prison, three years of supervised release, restitution and a civil penalty of $10,000 on each count.The charge of identity fraud provides for a sentence of no greater than five years in prison, one year of supervised release, forfeiture and a fine of $250,000.Actual sentences for federal crimes are typically less than the maximum penalties.Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz and Rear Admiral Steven D. Poulin, Commander, First Coast Guard District, U.S. Coast Guard, made the announcement. The case is being prosecuted by Assistant U.S. Attorney Giselle J. Joffre of Ortiz’s Major Crimes Unit.
Eleventh Twin Cities Man Charged with Conspiracy to Provide Material Support to ISILRead the Press Release
Numerous Alleged Co-Conspirators Previously Convicted at Trial and Pleaded Guilty in Minnesota
Mohamed Amiin Ali Roble, 20, formerly of Minneapolis, was charged today by criminal complaint with providing and conspiring to provide material support to the Islamic State of Iraq and the Levant (ISIL).
The charges were announced by Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Andrew M. Luger of the District of Minnesota and Special Agent in Charge Richard T. Thornton of the FBI’s Minneapolis Division.
According to the complaint and documents filed in court, on Oct. 4, 2014, Roble flew to China with a family member. In November 2014, four of Roble’s associates in Minnesota attempted to travel from Minnesota to Syria to join ISIL, via JFK International Airport in New York. The four defendants were stopped by federal law enforcement agents at JFK and were prevented from flying from New York to various destinations in Europe. Also in November 2014, Roble bought airplane tickets and flew to Istanbul, but returned to China shortly thereafter.
On Dec. 27, 2014, Roble again traveled to Istanbul and, according to the complaint, subsequently made his way into Syria and joined ISIL.
A criminal complaint is merely an allegation, and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
This case is the result of an investigation conducted by members of the FBI-led Joint Terrorism Task Force (JTTF). The Minnesota JTTF includes members from the U.S. Marshals Service; Bloomington, Minnesota, Police Department; Ramsey County, Minnesota, Sheriff’s Office; Hennepin County, Minnesota, Sheriff’s Office, Federal Air Marshals Service; Customs and Border Patrol; Department of Homeland Security; Minneapolis Police Department; the Airport Police; Internal Revenue Service-Criminal Investigation; and the FBI. The National Security Division’s Counterterrorism Section and the U.S. Attorney’s Office of the District of Minnesota are prosecuting the case.
Eleventh Twin Cities Man Charged with Conspiracy to Provide Material Support to ISILRead the Press Release
United States Attorney for the District of Minnesota Andrew M. Luger and Special Agent in Charge for the Minneapolis Division of the FBI Richard T. Thornton today announced a criminal complaint charging MOHAMED AMIIN ALI ROBLE, 20, with conspiring to provide material support to the Islamic State of Iraq and the Levant (ISIL) and providing material support to ISIL.According to the complaint and documents filed in court, on October 4, 2014, ROBLE and his mother flew from Minneapolis to Beijing, China. From Beijing, ROBLE flew to Wuhan, in Hubei Province, China.
Approximately one-month later, four of ROBLE’s co-defendants attempted to travel from Minnesota to Syria to join ISIL, via New York’s JFK International Airport. The four co-defendants were stopped by federal law enforcement agents at JFK from flying from New York to various destinations in Europe.
According to the complaint and documents filed in court, during the same time period that his co-defendants made their attempt to travel through New York to Turkey, ROBLE made six cash withdrawals of approximately $1,000 each from an ATM in Wuhan, China. The withdrawals were made from an account containing funds ROBLE obtained from a monetary settlement he was awarded after suffering personal injuries in the I-35W bridge collapse of August 1, 2007.
According to the complaint and documents filed in court, in November 2014 ROBLE bought airfare and flew to Istanbul, Turkey. From Turkey, ROBLE called his mother and told her that he was in Turkey “shopping,” and that he needed an airline ticket back to China, which she purchased for him. ROBLE returned to China shortly thereafter.
On December 27, 2014, ROBLE again traveled to Istanbul. ROBLE did not return to China from this second trip to Turkey.
This case is the result of an investigation conducted by members of the FBI-led Joint Terrorism Task Force (JTTF). The JTTF includes members from the following departments: the United States Marshals Service, Bloomington Police Department, Ramsey County Sheriff’s Office, Hennepin County Sheriff’s Office, Federal Air Marshals Service, Customs and Border Patrol, Department of Homeland Security, Minneapolis Police Department, the Airport Police, IRS-CI, and the FBI.
Defendant Information:MOHAMED AMIIN ALI ROBLE, 20
Minneapolis, Minn.Charges:
• Conspiracy to provide material support to a designated foreign terrorist organization, 1 count
• Providing material support to a designated foreign terrorist organization, 1 countEl Paso, Texas, Men Enter Guilty Pleas in New Mexico in Spice Trafficking CaseRead the Press Release
ALBUQUERQUE – Juan C. Chavez, 39, of El Paso, Texas pled guilty today in federal court in Las Cruces, N.M., to participating in a conspiracy to distribute controlled substance analogues, commonly known as “spice.” Co-defendant David Molinar, 34, also of El Paso, Texas, entered a guilty plea on Aug. 19, 2016, in the same case to the unlawful sale of drug paraphernalia. Under the terms of their plea agreements, Chavez will be sentenced to 18 months in prison and Molinar will be sentenced to 15 months in prison. Each will serve a term of supervised release to be determined by the court after completing his prison sentence.
Chavez, Molinar and co-defendants Tasha S. Garcia, 30, of El Paso, and Kenia N. Liberato, 27, of Sunland Park, N.M., were charged in an eight-count indictment filed on Sept. 16, 2015. The indictment charges all four defendants with conspiring to distribute “spice” from June 2012 through Sept. 2015. It also charged Molinar and Chavez with maintaining a place for the purpose of manufacturing, distributing and using “spice,” and three counts of possession of “spice.” Molinar, Chavez and Garcia also were charged with distributing “spice” and selling drug paraphernalia in May 2014, and distributing “spice” in June 2015. According to the indictment, the defendants committed the crimes in Doña Ana County, N.M.
During today’s proceedings, Chavez pled guilty to Count 1 of the indictment charging him with conspiracy to distribute controlled substance analogues. In entering the guilty plea, Chavez admitted that from June 2012 through Sept. 2015, he owned and operated a head shop known as “Station Recreation.” While operating “Station Recreation,” Chavez agreed and acted with his co-defendants to distribute “spice.”
Molinar entered a guilty plea on Aug. 19, 2016, to Count 7 of the indictment, which charged him with selling drug paraphernalia. In his plea agreement, Molinar admitted that he was the co-owner of a smoke shop in Sunland Park, and that on May 29, 2014, one of his employees sold drug paraphernalia at the smoke shop.
Sentencing hearings for Chavez and Molinar have yet to be scheduled.
The charges against Garcia have been dismissed, and Liberato is participating in a pretrial diversion program.
This case was investigated by the El Paso office of the DEA, Homeland Security Investigations, Customs and Border Protection, U.S. Border Patrol, Anthony (N.M.) Police Department, El Paso Police Department, El Paso County Sheriff’s Office, Texas Attorney General’s Office and Charleston, W.V. Police Department. Assistant U.S. Attorneys Mark A. Saltman and John Balla of the U.S. Attorney’s Las Cruces Branch Office are prosecuting the case.
The controlled substance analogues charged in the indictment are commonly referred to as synthetic cannabinoids or “spice.” According to the DEA, over the past several years, there has been a growing use of synthetic cannabinoids. Smoke-able herbal blends marketed as being “legal” and providing a marijuana-like high have become increasingly popular because they are easily available and, in many cases, more potent and dangerous than marijuana. These products consist of plant material that has been coated with dangerous psychoactive compounds that mimic THC, the active ingredient in marijuana. These substances, however, have not been approved by the Food and Drug Administration for human consumption, and there is no oversight of the manufacturing process. Synthetic cannabinoids often are labeled as incense to mask their intended purpose.
East Idaho Man Pleads Guilty to Producing Child PornographyRead the Press Release
POCATELLO – Erik Rodriguez, 25, of Rupert, Idaho, pleaded guilty today to sexual exploitation of a minor child, U.S. Attorney Wendy J. Olson announced. Rodriguez was indicted by a federal grand jury in Pocatello on November 24, 2015.
According to the plea agreement, Homeland Security special agents, working in conjunction with the Idaho Internet Crimes Against Children Task Force (ICAC) officers, downloaded a sexually exploitative video of a minor from an individual later identified as Rodriguez in April 2015. After a search of Rodriguez’s home revealed numerous computers and electronic devices being used to view and store child pornography, Rodriguez admitted to possessing and producing child pornography. Agents found approximately 133 images and 302 videos of child sexual abuse material on Rodriguez’s devices, in addition to the sexually explicit images Rodriguez produced of a girl under 10 years old.
The charge of sexual exploitation of a minor is punishable by at least 15, and up to 30, years in prison, a maximum fine of $250,000, and five years, up to a life term, of supervised release.
Sentencing is set for November 8, 2016, before Chief U.S. District Judge B. Lynn Winmill at the federal courthouse in Pocatello.
The case was investigated by U.S. Immigration and Custom Enforcement’s (ICE) Homeland Security Investigations (HSI), the Minidoka County Sheriff’s Office, and the Idaho ICAC Task Force.
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.”
Dunbar heroin dealer pleads guilty to federal drug crimeRead the Press Release
CHARLESTON, W.Va. – A Dunbar man pleaded guilty today to a federal heroin crime, announced United States Attorney Carol Casto. Christian Bowles, 24, entered his guilty plea to distribution of heroin.
Bowles admitted that on March 24, 2015, he sold over four grams of heroin to a confidential informant working with law enforcement in exchange for $1,000. Bowles made the drug deal outside of his Dunbar residence. He further admitted that he was involved in the distribution of up to 20 grams of heroin.
Bowles faces up to 20 years in federal prison when he is sentenced on December 5, 2016.
The Charleston Police Department’s Special Enforcement Unit conducted the investigation. Assistant United States Attorney John J. Frail is handling the prosecution. The plea hearing was held before United States District Judge John T. Copenhaver, Jr.
This case is being prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and heroin. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
Defunct Cosmetology School’s Insurer Pays $8.6 Million to Resolve Claims that School Improperly Obtained Federal Student Loan FundsRead the Press Release
LOS ANGELES – The insurance carrier for a defunct, for-profit cosmetology school has paid the United States $8,631,000 to resolve civil allegations that the school obtained federal student loan funds for ineligible students who received bogus high school diplomas.
B&H Education, Inc. (B&H), which operated the Marinello Schools of Beauty in locations across Southern California, was accused in a “whistleblower” lawsuit of improperly assisting adult students who did not have high school diplomas to obtain bogus high school diplomas. B&H allegedly allowed students seeking high school diplomas to take their tests without proctors, to use their phones and workbooks to look up answers during tests, and to repeat the same tests until they passed.
Many of the students who received their high school diplomas through this program then enrolled at B&H, and, with B&H’s assistance, applied for and received federal student loans for which they were not eligible. Under U.S. Department of Education (ED) regulations, a student must have a valid high school diploma or its equivalent in order to receive federal student loans.
“The operator of this school manipulated the system in order to fraudulently secure student aid funds without which the school could not function,” said United States Attorney Eileen M. Decker. “Today’s settlement demonstrates my office’s commitment to ensuring the integrity of federal programs, and the public monies used to support them.”
“Our students depend on higher education institutions to prepare them for careers through a quality education. Unfortunately, some schools violate their trust through deceptive marketing practices and defraud taxpayers by giving out student aid inappropriately. These unscrupulous institutions use questionable business practices or outright lie to both students and the federal government,” said ED Under Secretary Ted Mitchell. “In these cases we are taking aggressive action to protect students and taxpayers from further harm by these institutions.”
The allegations against B&H first surfaced in a qui tam, or whistleblower, lawsuit filed by six former B&H employees in 2013 under the False Claims Act. Pursuant to the provisions of the False Claims Act, as a result of the settlement announced today, the six whistleblowers collectively will receive $2.5 million for filing the lawsuit on behalf of the United States.
The settlement is with the insurance carrier because B&H went out of business earlier this year after the ED denied B&H’s recertification application to continue participating in federal student financial assistance programs. B&H’s only remaining non-secured asset was its insurance policy issued by Philadelphia Indemnity Insurance Company. In April, United States District Judge R. Gary Klausner allowed the insurer to intervene in the civil lawsuit.
In February, the ED cut off Marinello's participation in the federal student aid program after determining that the institution was knowingly requesting federal aid for students based on invalid high school diplomas, underawarding federal student aid to students, charging students for excessive overtime and engaging in other acts of misrepresentation. This action included 23 Marinello campuses in Las Vegas, Nevada; Los Angeles; Burbank, California; Moreno Valley, California; and Sacramento, California. The entire Marinello school chain – with 56 campuses across the nation – received more than $87 million in Pell Grants and federal student loans for the 2014-15 school year. The entire chain closed shortly after the action was initiated.
In addition to the $8.6 million payment to the United States, pursuant to the False Claims Act, the insurer will also pay $2,369,000 to the six whistleblowers’ attorneys, who have litigated the case since January 2015 and partnered with the U.S. Department of Justice to negotiate the settlement.
Philadelphia Indemnity agreed to the civil settlement without admitting any wrongdoing by its insured, B&H, and paid the settlement on August 15. On August 22, Judge Klausner dismissed the case against B&H, United States ex rel. Caron, et al. v. B&H Education, Inc., et al., CV13-5256-RGK.
The government’s investigation was conducted by the U.S. Department of Education’s Multi-Regional School Participation Division, the Administrative Actions and Appeals Service Group, the Office of the General Counsel, and the Office of Inspector General.
The settlement was handled by Assistant United States Attorney Abraham Meltzer of the Civil Division’s Civil Fraud Section.
Commercial Trash Hauler Sentenced to Three Years in Federal Prison for Bribe SchemeRead the Press Release
Baltimore, Maryland – U.S. District Judge Marvin J. Garbis sentenced, John Howard Brady, age 74, of Glen Burnie, to three years in prison, followed by three years of supervised release, for conspiracy and two counts of bribery in connection with a scheme in which Brady and other commercial haulers paid City of Baltimore Department of Public Works (DPW) employees cash in return for allowing the haulers to deposit trash at the Quarantine Road Landfill (Landfill) without paying the required disposal fees. Brady was convicted on November 20, 2015, after a five day trial. Judge Garbis also ordered that Brady pay restitution, with the exact amount to be determined at a later date.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation; Robert H. Pearre, Jr., Inspector General, City of Baltimore Office of Inspector General; Special Agent in Charge Thomas Jankowski of the Internal Revenue Service - Criminal Investigation, Washington, D.C. Field Office; and Colonel William M. Pallozzi, Superintendent of the Maryland State Police.
The DPW’s Bureau of Solid Waste is responsible for managing Baltimore City’s waste management services, including overseeing citizen drop-off centers, such as the NWTS and the Landfill. Baltimore City residents can deposit small amounts of trash and/or recyclables in dumpsters located near the main entrance of the Landfill, free of charge. Individuals or companies commercially hauling trash that have registered their vehicles with the City must obtain Landfill permits. Commercial haulers of trash must also pay a waste disposal fee of $67.50 per ton of trash deposited at the Landfill. DPW employees assigned as scale house operators weigh each truck as it enters the Landfill, which is recorded on a computerized point-of-sale system. The scale house operators reweigh each truck as it leaves the Landfill. The net weight of the deposited trash and the required disposal fee is then calculated and printed on a receipt that is handed to the driver.
According to the evidence presented at Brady’s trial, Brady was a commercial trash hauler who owned and operated Brady’s Roll Off Service. Beginning in approximately 2002, Brady agreed to pay bribes to the DPW scale house operators, including Tamara Washington and William Nemec. In exchange, the scale house operators did not charge Brady a disposal fee for using the Landfill. For example, on March 30, 2015, Brady paid a $2,000 cash bribe to Tamara Washington, which represented about 20 trips to the landfill when Brady was allowed to dump for free. The bribes paid to the scale house operators saved Brady thousands of fees each month. Brady either paid the operator through the outbound window at the scale house, or met the operators at an off-site location where he would pay a week’s worth of bribes or more. Evidence at trial established that Brady’s company used the landfill dozens of times a year since 2002, resulting in a loss of more than $1,000,000 in disposal fees for the City of Baltimore.
Former Baltimore City Department of Public Works (DPW) employees William Charles Nemec, Sr., age 56, and Tamara Oliver Washington age 56, both of Baltimore, pleaded guilty to their roles in the scheme and were sentenced to 78 months to 18 months in prison, respectively. Judge Garbis also entered orders requiring Nemec and Washington to pay restitution of $6 million. A total of six Baltimore Department of Public Works (DPW) employees and six commercial trash haulers, including Brady, Nemec, and Washington, have been convicted in federal court for this scheme, and/or a second scheme in which DPW employees stole scrap metal from the Landfill for personal gain.
United States Attorney Rod J. Rosenstein praised the FBI, IRS-CI, Baltimore Office of Inspector General, and Maryland State Police for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorney Martin J. Clarke and Leo J. Wise, who prosecuted the case.
Columbia Man Indicted for Producing Child PornRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Columbia, Mo., man who was previously indicted on charges related to child pornography was indicted by a federal grand jury today on an additional charge of producing child pornography.
Justin Gene Hull, 32, of Columbia, was charged in a four-count superseding indictment returned by a federal grand jury in Jefferson City, Mo. Today’s superseding indictment replaces the original indictment returned on April 21, 2016.
Today’s indictment charges Hull with using a minor to produce child pornography on Dec. 9, 2015. It also contains the original three counts of distributing child pornography in December 2015 and receiving and possessing child pornography from December 2014 to December 2015.
Dickinson cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Jim Lynn. It was investigated by the FBI, the Boone County, Mo., Sheriff’s Department and the St. Charles Cyber Crimes Forensic Laboratory.
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."
Cannon Design to pay $12 million as part of criminal enforcement agreementRead the Press Release
Cannon Design will pay a $12 million penalty, implement a series of corporate reforms and divest itself from a large project in California to resolve the company’s criminal liability for the conduct of more than a dozen employees, including paying bribes and kickbacks to obtain confidential information related to Veterans Affairs construction projects.
As stated in the criminal enforcement agreement, Buffalo-based Cannon has:
- accepted legal responsibility for the criminal conduct of its employees.
- agreed to pay a monetary penalty to the United States of $12 million.
- agreed to fully cooperate with the United States.
- agreed to divest itself of any involvement in the design of the VA West Los Angeles project, which the VA awarded to a joint venture including Cannon.
- made company-wide revisions and enhancements to its compliance program, internal controls, policies and procedure to detect and deter fraud.
William D. Montague, the former director of the Cleveland Veterans Affairs Medical Center, was sentenced earlier this year to nearly five years in prison after being found guilty of 64 counts, including Hobbs Act conspiracy, conspiracy to commit honest services mail fraud, violating the Hobbs Act, money laundering, multiple counts of wire fraud, mail fraud, disclosing public contract information and other charges.
Cannon executive Mark Farmer was sentenced to nearly three years in prison after a federal jury convicted him on 14 counts related to providing things of value to Montague in exchange for confidential information about VA construction projects.
According to court documents:
Montague served as director of the Cleveland VA Medical Center from 1995 through 2010. In 2011, Montague began working as director of the Dayton VA Medical Center.
From January 2010, Montague, Farmer and Cannon conspired to defraud the VA of its right to the honest and faithful service of Montague through bribery and kickbacks and to defraud the VA and other potential VA contractors by means of false and fraudulent pretenses.
Montague secretly used his position as Dayton VA Medical Center director to enrich himself by soliciting and accepting gifts, payments, and other things of value from Cannon in exchange for favorable official actions. He solicited money and a consulting contract from Cannon in exchange for information related to VA contracts and projects, which would benefit Farmer, Cannon and others.
This was done to give Cannon an advantage in obtaining VA contracts and projects. Montague gave false and misleading information to VA employees about his reasons for requesting VA documents and information.
For example, on March 1, 2011, Cannon issued a $20,000 check to Montague. Ten days later, Farmer sent an e-mail to some employees with Montague’s consulting agreement explaining: “His job is to help us bring in more work from the VA, in part by helping us access key decision makers. On March 14, 2011, Farmer sent another e-mail to some employees stating Cannon will end the current “$15 [million VA] IDIQ contract with just slightly over $12M in sales. $3M in fee, therefore, will be left on the table…[O]ne of MONTAGUE’s jobs will be to fill up the bucket by directing task orders toward our contract, Going forward, we have two $15M buckets to fill (Central and Eastern regions). That’s a lot of shoveling to get to $30M…BILL has the relationships to help us maximize the contracts…On the VA ‘major construction’ front here is the list of medical centers and their approximate construction cost in the pipeline: West Los Angeles, CA: $750M; San Francisco, CA: $125M, Reno, NV: $115M, Alameda, CA: $225M. Montague told us about these before they were advertised, which has allowed us to get an early start in developing the team. If we bring him on board, he can help us pull in one or two of these large projects.”
“Companies must never benefit by using public officials to obtain a competitive business advantage,” said Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland Office. “The FBI will continue to root out corruption at all levels.”
“This meaningful agreement holds the corporation accountable for the conduct of its leadership,” said Michael J. Missal, Inspector General, U.S. Department of Veterans Affairs, Office of Inspector General (VA OIG). “A $12 million penalty along with 90 months of prison time for related case subjects is a strong deterrent against defrauding VA. We will continue to diligently and aggressively pursue fraud, waste, and abuse for the benefit of our nation’s heroes.”
The case was prosecuted by Assistant United States Attorneys Antoinette T. Bacon and Paul Flannery following an investigation by the FBI and United States Department of Veterans Affairs-Office of Inspector General.
California man accused of trafficking cocaine into Greater ClevelandRead the Press Release
A federal grand jury issued a four-count indictment charging Justin Roman, 26, of California, with trafficking multiple kilograms of cocaine into the Cleveland area, said Carole S. Rendon, United States Attorney for the Northern District of Ohio.
Law enforcement officials allege Roman distributed approximately three kilograms of cocaine for distribution in the Cleveland area through the mail.
Roman is also charged in the District of New Jersey for similar conduct.
Assistant U.S. Attorney Matt Cronin is prosecuting the case following an investigation by the United States Postal Inspection Service.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum. In most cases, it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial, in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Buffalo Man Sentenced to 6 Years in Prison for Conspiring to Distribute Crack CocaineRead the Press Release
PITTSBURGH – A New York resident has been sentenced in federal court to 6 years’ imprisonment on his conviction of conspiracy to distribute 28 grams or more of crack cocaine, United States Attorney David J. Hickton announced today.
United States District Judge Nora Barry Fischer imposed the sentence on Rondell Evans, 23, of Buffalo, NY.
According to information presented to the Court, in 2015, the Bureau of Alcohol, Tobacco Firearms and Explosives, the Drug Enforcement Administration, and other agencies joined forces in a long-term wiretap investigation of drug trafficking in New Castle, Pa. The investigation revealed that Rondell Evans conspired with others to possess with intent to distribute and distribute crack cocaine which was transported from Buffalo to the New Castle area for further distribution.
Assistant United States Attorneys Jonathan B. Ortiz and Tonya Sulia Goodman prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Drug Enforcement Administration, the New Castle Police Department, and the Lawrence County Drug Task Force for the investigation leading to the successful prosecution of Evans.
Buffalo Man Sentenced for Setting A Buffalo Business on FireRead 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 Ryan Smolinski, 27, of Buffalo, NY, who was convicted of arson of a commercial building, was sentenced to 37 months in prison by U.S. District Judge Richard J. Arcara.
Assistant U.S. Attorney Timothy C. Lynch, who handled the case, stated that on June 13, 2014, Smolinski, along with co-defendant Lowell Carey and Christopher Gorman, went to 349 Ontario St., occupied by WNY Property Contractors, and threw a Molotov cocktail onto the roof of the building and placed anpther Molotov cocktail underneath a garage door on the side of the building.
On the night of June 12, 2014, Smolinski had been drinking with Carey and Gorman at Carey’s house. Smolinski was upset about his father losing his business, Western New York Property Contractors, which his father co-owned with another individual. Smolinski asked Carey and Gorman if they would help him burn the building. They agreed and made the two Molotov cocktails from beer bottles they had been drinking from and using gasoline and a t-shirt as a wick.
Smolinski, Carey, and Gorman proceeded to Western New York Property Contractors in the early morning hours of June 13, 2014 and set off the Lolotov cocktails. The outside of the building was burned in the areas where the Molotov cocktails were located resulting in approximately $2,207.89 in damages.
Buffalo Man Sentenced for His Role in Setting A Buffalo Business on FireRead 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 Lowell Carey, 56, of Buffalo, NY, who was convicted of arson of a commercial building, was sentenced to 41 months in prison by U.S. District Judge Richard J. Arcara.
Assistant U.S. Attorney Timothy C. Lynch, who handled the case, stated that on June 13, 2014, Carey, along with co-defendants Ryan Smolinski and Christopher Gorman, went to 349 Ontario St., occupied by WNY Property Contractors, and threw a Molotov cocktail onto the roof of the building and placed another Molotov cocktail underneath a garage door on the side of the building.
On the night of June 12, 2014, the three defendants were drinking at Carey’s house. Smolinski was upset about his father losing his business, Western New York Property Contractors, which his father co-owned with another individual. Smolinski asked Carey and Gorman if they would help him burn the building. They agreed and made the two Molotov cocktails from beer bottles they had been drinking from and using gasoline and a t-shirt as a wick.
Smolinski, Carey, and Gorman proceeded to Western New York Property Contractors in the early morning hours of June 13, 2014 and set off the Molotov cocktails. The outside of the building was burned in the areas where the Molotov cocktails were located resulting in approximately $2,207.89 in damages.
Carey and Smolinski have been convicted and sentenced, Gorman has been convicted and is awaiting sentencing
Today’s sentencing is the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Acting Special Agent in Charge Charlie J. Patterson, and the Buffalo Fire Department, under the direction of Commissioner Garnell Whitfield.Buffalo Man Pleads Guilty to Drug Charge; His Brother Sentenced on Drug and Gun ChargesRead 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 Jonathan Ortiz, 23, of Buffalo, NY, who was convicted of attempted possession with intent to distribute cocaine, was sentenced to 57 months in prison by U.S. District Judge Elizabeth A. Wolford. In a related case, his brother, Reynaldo Ortiz, 25, also of Buffalo, pleaded guilty to possession with intent to distribute and distribution of heroin and use of a firearm in furtherance of drug trafficking crimes before Judge Wolford. Those charges together carry a minimum penalty of 20 years in prison, a maximum of life and a $10,250,000 fine.
Assistant U.S. Attorney Wei Xiang, who is handling the cases, stated that in April 2015, law enforcement officers intercepted a package mailed from Puerto Rico to a residence on Hudson Street in Buffalo. The package contained a set of audio speakers. Four packets of cocaine, each weighing approximately one-eighth of a kilogram, were secreted inside the speakers. A controlled delivery of the package led to its retrieval by Jonathan Ortiz and another individual. The two were arrested after a sensor alerted officers that the package was opened.
Reynaldo Ortiz sold heroin and cocaine in the vicinity of Maryland Street and Trenton Avenue in Buffalo. At the time of his arrest in September 2015, he possessed a loaded AK-47-type rifle and two magazines containing 36 rounds of ammunition. Ortiz admitted to exchanging gunfire with a rival drug dealer over territory in the vicinity of Hudson Street and 7th Street.
The sentencing and plea are the result of investigations by the Buffalo Police Department, under the direction of Commissioner Daniel Derenda, the Drug Enforcement Administration, under the direction of Special Agent in Charge James J. Hunt, New York Field Division, the Federal Bureau of Investigation Safe Streets Task Force, under the direction of Special Agent in Charge Adam S. Cohen, and the and U.S. Postal Inspection Service, under the direction of under the direction of Inspector in Charge Shelly Binkowski.
Sentencing for Reynaldo Ortiz will be scheduled at a later date before Judge Wolford.
Buffalo Man Arrested on Gun ChargeRead 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 Jeffrey Early, 32, of Buffalo, NY, was arrested and charged with being a felon in possession of a firearm. The charge carries a maximum penalty of 10 years in prison and a $250,000 fine.
Assistant U.S. Attorney Patricia Astorga, who is handling the case stated that according to the complaint, on June 14, 2016, Buffalo Police Officers observed the defendant in the vicinity of 66 Barthel in Buffalo. Officers noticed Early wearing sweatpants and with his left hand on a bulge on his left leg. One of the officers then saw an extended magazine and shouted "Gun!" The defendant ran as the officers shouted multiple times "Gun! Drop It! Stop!" While fleeing from the officers, Early pulled a firearm from his waistband and jumped over a fence located at 75 Wasmuth.
While in the rear of the yard at 75 Wasmuth, officers saw the defendant with a firearm in his left hand and ordered him to drop the weapon and stop running. The complaint states that Early turned back toward the officers and jumped the fence of 75 Wasmuth and threw the firearm into a vacant field on the side of 75 Wasmuth. The defendant continued to flee from officers and jumped over the fence into 102 Barthel where he was taken into custody by officers. Buffalo Police officers immediately recovered the weapon, a Glock 9mm pistol loaded with one live cartridge in the chamber. Officers also recovered 32 live cartridges and a black piece from the bottom of the magazine and the spring to the magazine in the rear of 75 Wasmuth.The defendant will appear in court this afternoon for a detention hearing at 4:00 p.m. before U.S. Magistrate Judge Michael J. Roemer.
The complaint is the result of an investigation by the Buffalo Police Department, under the direction of Commissioner Daniel Derenda, the Bureau of Alcohol, Tobacco, Firearms, and Explosives, under the direction of Special Agent in Charge Delano A. Reid, and the U.S. Marshals Service, under the direction of Charles Salina.The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
Bremerton, Washington Man Sentenced to Twenty-Seven Years for Production of Child PornographyRead the Press Release
Spokane– Today, Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that Larry Gutierrez, age 50, of Bremerton, Washington, after having pled guilty on March 14, 2016 to production of child pornography, was sentenced today by United States District Judge Salvador Mendoza, Jr. Judge Mendoza sentenced Gutierrez to a twenty-seven year term of imprisonment and a life term of court supervised upon release from federal prison.
According to information disclosed during the court proceedings, on September 23, 2014 the mother of a 9 year-old girl in Spokane, Washington reported that she (the mother) found child pornography on her child’s phone, including photos of her 9 year old. Law enforcement officers interviewed the child, who explained that she met a person on the communication application Kik Messenger. The child explained that she sent the person nude images of herself, as per his request. Subsequent search warrants revealed the person the child was speaking to was Larry Gutierrez.
In a chat between Gutierrez and the child, she tells Gutierrez she is in fourth grade and when she will turn ten years old. During the chat, Gutierrez sends the victim-child several images of a younger athletic male, claiming the photos are of him; they were not. Gutierrez made specific requests that the child send pornographic videos showing her genitalia. A few days later, Gutierrez wrote if she did not send more images, he would post the child’s pictures and Kik Messenger name so other adult men could contact her.
Search warrants were executed on Gutierrez’s electronic devices. Similar images were found of more than forty other children. Gutierrez looked for the children on Kik Messenger and targeted young females. Gutierrez routinely purported to be the young athletic male, would flatter the children, and would ask for photos. He often had his victims hold a sign indicating their minor age.
Gutierrez also extorted other children, threatening them if they did not send the additional photos he was asking for. One child is seen in a photo holding a sign indicating her young age and then in another photo with sign which reads, “Stop blackmailing me.” Gutierrez threatened several children that he
would post photos he had already received of them if they did not send what he was asking for. Gutierrez did, in fact, distribute some of the photos he produced using children he had met on Kik Messenger.
At sentencing Gutierrez told the Court he would like to apologize to the victims and their families and let the Court know he would use his time in prison productively. The Court found Gutierrez’s case to be among the most serious the Court deals with. The Court indicated, though Gutierrez did not have physical contact with his victims, his actions would nonetheless have lasting, lifelong, effects on them.
United States Attorney Michael Ormsby said, “Gutierrez used social media to target and sexually exploit vulnerable children, some of whom were still in elementary school. Unfortunately, this type of crime is a growing threat in the Eastern District of Washington and elsewhere. While law enforcement is doing everything it can to stop these predators, it is of the utmost importance parents be vigilant. Any child with access to the internet is vulnerable to these criminals.”
“Sextortion” is a serious crime that occurs when someone threatens to distribute your private and sensitive material if you don’t provide them images of a sexual nature, sexual favors, or money. The perpetrator may also threaten to harm your friends or relatives by using information they have obtained from your electronic devices unless you comply with their demands. Sextortion can have devastating effects on young victims from all walks of life, and it is easy to become a victim.
Online perpetrators might gain a person’s trust by pretending to be someone they are not. They lurk in chat rooms and record young people who post or live-stream sexually explicit images and videos of themselves, or they may hack into a person’s electronic devices using malware to gain access to files and control the person’s web camera and microphone without she/he knowing it.
Here are some things individuals can do to avoid becoming a sextortion victim:
• Never send compromising images of yourself to anyone, no matter who they are—or who they say they are.
• Do not open attachments from people you do not know.
• Turn off your electronic devices and web cameras when you are not using them.
If you believe you are a victim of sextortion, or know someone else who is, call your local FBI office or toll-free at 1-800-CALL-FBI. Additional information about sextortion can be found online at:
FBI: https://www.fbi.gov/news/stories/2015/july/sextortion/video/what-is-sextortion
DOJ: https://www.justice.gov/psc/videos
https://www.justice.gov/psc/video/sextortion-public-service-announcement-60-seconds
https://www.justice.gov/psc/national-strategy-child-exploitation-prevention-and-interdiction
This case was pursued as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the United States 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. The Project Safe Childhood Initiative (“PSC”) has five major components:
· Integrated federal, state, and local efforts to investigate and prosecute child exploitation
cases, and to identify and rescue children;
· Participation of PSC partners in coordinated national initiatives;
· Increased federal enforcement in child pornography and enticement cases;
· Training of federal, state, and local law enforcement agents; and
· Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
The investigation was conducted by the Federal Bureau of Investigation. This case was prosecuted by Alison L. Gregoire, an Assistant U.S. Attorney for the Eastern District of Washington.
Boston Man Indicted in Multi-Million Dollar Scheme to Defraud Brokerage FirmsRead the Press Release
BOSTON – A Boston man was indicted today in connection with a three-year, multi-million dollar fraud scheme.
Nathaniel Ponn, 28, was indicted on two counts of wire fraud. Ponn has been held in custody since March 2016 when he was arrested and charged in a related criminal complaint.
According to court documents, it is alleged that from 2012 to April 2015, Ponn opened more than 400 brokerage accounts at nine investment firms throughout the United States, and used false names, Social Security Numbers, assets and income to open many of them. The firms allowed customers to transfer funds from one financial institution into the customer’s brokerage account through an Automated Clearing House (ACH) transfer, by providing the account number and financial institution where the account was held and the amount to be transferred.
According to court documents, from February 2014 to April 2015, Ponn provided ACH transfer information to brokerage firms for accounts he opened on more than 350 occasions, totaling more than $8.5 million in attempted transfers. In each instance, the bank account Ponn allegedly provided did not have the amount of funds requested or, in some circumstances, did not even exist. Although the ACH transfers were rejected, the fraudulent transfers created the false appearance that the brokerage accounts had cash available to purchase securities.
Through this scheme, Ponn was allegedly able to purchase securities totaling more than $2.7 million in accounts at eight investment firms. When the firms discovered that the ACH transfers were rejected, they liquidated the securities in Ponn’s accounts.
The charge of wire fraud provides for a sentence of no greater than 20 years in prison, three years of supervised release and a fine of $1 million on each count. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
The U.S. Attorney’s Office received valuable assistance from the Securities and Exchange Commission, which filed a civil action against Ponn in March arising out of the scheme to defraud investment firms.
United States Attorney Carmen M. Ortiz and Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Mark J. Balthazard of Ortiz’s Economic Crimes Unit.
The details contained in the charging document are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Artesia Man Sentenced to Prison for Federal Methamphetamine Trafficking ConvictionRead the Press Release
ALBUQUERQUE – Charles Edward Gist, 56, of Artesia, N.M., was sentenced today in federal court in Las Cruces, N.M., to 21 months in prison followed by two years of supervised release for his conviction on methamphetamine trafficking charges.
Gist and co-defendant Jose Alfredo Villa, 35, of Lake Arthur, N.M., were arrested in Sept. 2015, on an indictment charging them with conspiracy to distribute methamphetamine from Nov. 17, 2014 through Nov. 20, 2014, and distribution of methamphetamine on Nov. 20, 2014. Villa was also charged with distribution of methamphetamine on Dec. 10, 2014. According to the indictment, the defendants committed the crimes in Eddy County, N.M.
Gist pled guilty on April 1, 2016, to a felony information charging him with conspiracy and distribution of methamphetamine. In entering the guilty plea, Gist admitted that he conspired with Villa and others to distribute methamphetamine from Nov. 17, 2014 through Nov. 20, 2014. Villa further admitted that on Nov. 20, 2014, he agreed to sell 56 grams of methamphetamine to an undercover law enforcement officer.
On April 13, 2016, Villa pled guilty to a felony information charging him with conspiracy and two counts of distribution of methamphetamine. In entering the guilty plea, Villa admitted to conspiring with Gist and others to distribute methamphetamine in Nov. 2014. Villa admitted supplying the methamphetamine that was distributed to an undercover law enforcement officer on Nov. 20, 2014. He also admitted distributing 51 grams of methamphetamine to an undercover law enforcement officer on Dec. 10, 2014. At sentencing, Villa faces a statutory mandatory minimum penalty of five years and a maximum of 40 years in prison. Villa remains in custody pending a sentencing hearing which has yet to be scheduled.
This case was investigated by the Las Cruces office of the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney Maria Y. Armijo of the U.S. Attorney’s Office Las Cruces Branch Office is prosecuting the case.
23 August 2016
Xanax Smuggler Sentenced to One Year ImprisonmentRead the Press Release
The Office of the United States Attorney for the District of Vermont announced Cedrick Bourgault-Morin, 22, of Quebec, Canada was sentenced yesterday for smuggling 281,307 pills of Aprazolam (commonly known as Xanax) into the United States. Chief United States District Judge Christina Reiss sentenced Bourgault-Morin to 12 months and 1 day of imprisonment, to be followed by one year of supervised release.
According to court records, at approximately 1:00 am on January 13, 2016, three United States Border Patrol agents responded to the area of the international border near the village of North Troy, Vermont. Agents observed Bourgault-Morin wearing white camouflage clothing, and walking on the tracks. Bourgault-Morin was pulling a plastic sled behind him, loaded with a large object wrapped in white camouflage. As Bourgault-Morin began to conceal the sled and its contents with snow, all three agents approached him, apprehended him, and seized the sled. The agents discovered a large duffle bag on the sled. A search of Bourgault-Morin’s person revealed he did not possess a wallet or any identification documents, no cellular telephone, or other common items. Other than his clothing, the only item on the defendant’s person was a silver folding lock-blade knife.
Upon further inspection at the Newport Station, the agents discovered the duffle to contain 300 vacuum-sealed plastic bags, containing a total of 281,307 pills. All of the pills were 2mg oblong bars that were scored and divisible into four .5mg segments. Each pill bore markings consistent with those used to identify Xanax, which is a brand name for Aprazolam. Aprazolam is a benzodiazepine class of psychoactive drug typically prescribed as an anti-anxiety medication, and a Schedule IV drug. The 300 bags of pills weighed approximately 182.82 pounds, and had a value of approximately $1.6 million.
This matter was investigated by the United States Border Patrol, with assistance from the Drug Enforcement Administration. The Swanton Sector Border Patrol is responsible for securing the land border between ports of entry in Vermont as well as New Hampshire and northeastern New York. The assistance of citizens is invaluable in helping the U.S. Border Patrol accomplish their border security mission and they welcome community members to help them keep our nation’s borders safe by reporting suspicious activity at 1-800-689-3362.
For more on CBP’s mission at our nation’s ports of entry with CBP officers and along U.S. borders with Border Patrol agents, please visit the Border Security section of the CBP website.
The United States was represented by Assistant U.S. Attorney Jonathan A. Ophardt. Bourgault-Morin was represented by Assistant Federal Public Defender David L. McColgin.Winthrop Man Sentenced for Stealing over $400,000 in Government BenefitsRead the Press Release
BOSTON – Richard Alan Hersey, 64, of Winthrop, was sentenced today in U.S. District Court in Boston for stealing over $400,000 in Social Security and federal pension benefits.
U.S. District Court Judge Leo T. Sorokin sentenced Hersey to five years of probation, including five months of home confinement, and ordered him to pay restitution of $227,476 to the Social Security Administration and $216,811 to the U.S. Office of Personnel Management, and a fine of $4,000. Prior to today’s hearing, Hersey repaid approximately $240,000 of the money he stole. Hersey pleaded guilty in November 2015.
In 1991, Hersey’s mother passed away; however, Hersey did not notify the Social Security Administration and the Civil Service Retirement System of her death, so her Social Security and pension funds continued to be directly deposited into a bank account held jointly by her and Hersey. Although he was not entitled to the funds, Hersey routinely withdrew them from the account after his mother’s death and spent them for his own use. For example, he spent a portion of the stolen money on a cruise to the Bahamas. In total, from 1991 to 2015, Hersey took $444,287 in Social Security and pension funds to which he was not entitled. When Hersey was first confronted by investigators in 2015, he falsely stated that he thought his mother was still alive. He later admitted that she was deceased.
United States Attorney Carmen M. Ortiz; Scott Antolik, Special Agent in Charge of the Social Security Administration, Office of Inspector General, Office of Investigations, Boston Field Division; and Scott Rezendes, Special Agent in Charge of the Office of Personnel Management, Office of Inspector General, Field Operations, made the announcement today. The Hersey case is being prosecuted by Special Assistant U.S. Attorney Timothy Landry of Ortiz’s Major Crimes Unit.
Wayne Man Charged with Intent to View Child PornographyRead the Press Release
Christopher Haas, 60 of Wayne, Pennsylvania was charged today by Information with accessing an internet website with the intent to view child pornography, announced United States Attorney Zane David Memeger. The information charges that Haas accessed an internet webpage on March 21 and 22, 2016, with the intent to view child pornography.
If convicted the defendant faces a maximum possible sentence of 20 years imprisonment, a $250,000 fine, forfeiture, restitution, at least 5 years of supervised release up to a lifetime of supervised release, and special assessments of $100 and $5,000.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by 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 better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The case was investigated by Homeland Security Investigations, with the assistance of the Radnor Police Department and the Villanova University Department of Public Safety, and is being prosecuted by Assistant United States Attorney Albert S. Glenn.
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Virginia Man Pleads Guilty to Production of Child PornographyRead the Press Release
An Alexandria, Virginia, man pleaded guilty today to production of child pornography for enticing minors to engage in sexually-explicit conduct online and recording the acts.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division; U.S. Attorney Dana J. Boente of the Eastern District of Virginia; Fairfax County, Virginia, Chief of Police Edwin C. Roessler Jr.; and Special Agent in Charge Clark E. Settles of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) Washington made the announcement.
Lucas Aronson, 31, was charged on April 8, 2016, and pleaded guilty before U.S. District Judge Anthony J. Trenga of the Eastern District of Virginia.
According to admissions made in connection with the plea agreement, a video and text chat website reported an Internet Protocol (IP) address to the National Center for Missing and Exploited Children for streaming child pornography. The IP address was linked to Aronson’s residence and during a court-authorized search of that residence, law enforcement officers recovered a thumb drive containing child pornography videos and conversations in which Aronson posed as a minor girl as he chatted with female minors online. Aronson admitted that he enticed some of the minors to engage in sexually explicit activity on web camera and recorded the video.
The Fairfax County Police and HSI investigated the case. Trial Attorney Lauren Britsch of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Jay V. Prabhu of the Eastern District of Virginia prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Van Nuys Man Sentenced to over 12 Years in Federal Prison for Distributing Child PornographyRead the Press Release
LOS ANGELES – A Salvadoran national from Van Nuys has been sentenced to 145 months in federal prison after being convicted of using the Internet to distribute child pornography.
Denis Aviles Salguero, 31, was sentenced on August 18 by United States District Judge Fernando M. Olguin. Following the completion of his sentence, Salguero will be on supervised release for 15 years.
Following a three-day trial in September 2013, Salguero was found guilty of 17 counts of distributing child pornography, one count of receiving child pornography and one count of possessing child pornography.
The evidence presented at his trial showed that Salguero traded child pornography with others, sharing images in his possession to obtain new pictures and video files.
“This defendant freely shared his child pornography collection for the purpose of obtaining additional images, which resulted in his conviction for distribution of child pornography,” said United States Attorney Eileen M. Decker. “The demand for child pornography drives a black market industry that relies on the sexual abuse of children and causes the continued victimization of those children as the images as spread around the world via the Internet.”
The case against Salguero stemmed from him uploading more than a dozen images of child pornography to a Yahoo usergroup page. Yahoo reported the postings to the National Center for Missing and Exploited Children, which alerted law enforcement officials. Authorities executed a search warrant at Salguero’s residence on July 20, 2010 and recovered a laptop computer that showed Salguero had used email to receive and send child pornography on numerous occasions in 2009 and 2010. An examination of the laptop revealed 402 still images and 67 videos depicting child pornography, most of which involved boys between the ages of 6 and 14. Some of the images and videos were of boys being molested and raped.
The investigation in this case was conducted by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI).
“The sexual exploitation of innocent children is unconscionable, and together with our law enforcement partners we will exhaust every resource to ensure these predators are punished,” said Joseph Macias, special agent in charge of HSI Los Angeles. “We owe it to the young victims in these cases, who will carry the emotional and physical scars of these crimes with them for the rest of their lives.”
This case was prosecuted by Assistant United States Attorney Christina T. Shay of the Violent and Organized Crime Section.
Ukranian Man Who Posed as Student Pleads Guilty to Federal Passport and Social Security Fraud ChargesRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that a Ukrainian man who posed as a high school student in Harrisburg and was indicted by a federal grand jury on May 25, 2016, for passport fraud and social security fraud plead guilty today to both charges before U.S. District Court Judge Sylvia H. Rambo in Harrisburg.
According to United States Attorney Peter Smith, Artur Samarin, age 23, using the identity of Asher Potts, applied for a United States passport, was fraudulently issued a social security card on July 17, 2014 and, later applied for and received a replacement card on November 18, 2015.
This case was investigated by the Department of State Diplomatic Security Service, the City of Harrisburg Bureau of Police and the Social Security Administration Office of Inspector General. The case is being prosecuted by Assistant United States Attorney Daryl F. Bloom.
No date was set for sentencing. Samarin also recently pleaded guilty to a separate charge in state court in Dauphin County.
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 15 years’ imprisonment, a term of supervised release following imprisonment, and a $500,000 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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U.S. Attorneys Richard S. Hartunian and Barbara L. McQuade Appointed to Lead the Attorney General's Advisory CommitteeRead the Press Release
Attorney General Loretta E. Lynch announced today the appointment of U.S. Attorney Richard S. Hartunian for the Northern District of New York as chair of the Attorney General’s Advisory Committee of U.S. Attorneys (AGAC). Attorney General Lynch also appointed U.S. Attorney Barbara L. McQuade for the Eastern District of Michigan to serve as vice chair. Both appointments are effective immediately.
“The Attorney General’s Advisory Committee plays an essential role in shaping the Justice Department’s policies, implementing its programs, and ensuring that equal justice and the rule of law are upheld throughout the United States,” said Attorney General Lynch. “As a former chair of the AGAC, I know firsthand the significant duties required of the committee’s leaders, and I am certain that U.S. Attorneys Richard Hartunian and Barbara McQuade are ready to assume the responsibility of chairing such an important and distinguished body. They are both seasoned prosecutors, exemplary law enforcement officers, and devoted public servants, and I look forward to benefitting from their long experience and wise counsel as we advance the department’s vital work in the months ahead. I congratulate them on their new posts, and I once again thank former U.S. Attorney John Walsh for his outstanding service as AGAC chair over the last 20 months.”
U.S. Attorney Hartunian has been the vice chair of the AGAC since January 2015. He was appointed to the AGAC in 2013 and has served as the co-chair of the Border and Immigration Subcommittee, as well as a member of the subcommittees focused on Native American issues, Health Care Fraud and Environmental Crimes. He has served as U.S. Attorney for the Northern District of New York since January of 2010. Before that, he had been an Assistant U.S. Attorney there since 1997 and the district’s Narcotics Chief and Organized Crime Drug Enforcement Task Force Coordinator since 2006.
U.S. Attorney Hartunian is a 1983 cum laude graduate of Georgetown University and a 1986 graduate of the Albany Law School of Union University. He was engaged in the private practice of law in Albany from 1987 to 1990. He served as an Assistant District Attorney in Albany County from 1990 to 1997, where his work on narcotics and violent crime cases led to his designation as a Special Assistant U.S. Attorney in 1994.
In May of 2010, U.S. Attorney Hartunian was honored by the Armenian Bar Association as the first U.S. Attorney of Armenian descent.
U.S. Attorney McQuade was appointed to the AGAC in April 2013 and has previously served as co-chair of the Terrorism and National Security Subcommittee. She also served on subcommittees addressing civil rights and border security. She became the first woman to serve as U.S. Attorney for the Eastern District of Michigan when she took office in January of 2010. She was an Assistant U.S. Attorney in Detroit, Michigan, for 12 years, including service as Deputy Chief of the National Security Unit.
U.S. Attorney McQuade is a 1987 graduate of the University of Michigan and a 1991 graduate of the University of Michigan Law School. Before becoming a federal prosecutor, she practiced law in a Detroit firm and served as a law clerk to a U.S. District Judge. From 2003 to 2009, U.S. Attorney McQuade was as an adjunct law professor at the University of Detroit Mercy School of Law.
While U.S. Attorney McQuade replaces U.S. Attorney Hartunian as vice chair, U.S. Attorney Hartunian replaces former U.S. Attorney John Walsh for the District of Colorado as chair.
The AGAC was created in 1973 to serve as the voice of the U.S. Attorneys and to advise the Attorney General on policy, management and operational issues impacting the offices of the U.S. Attorneys.
Two More Defendants Who Sold ‘Gravel’ Sentenced in Federal CourtRead the Press Release
ABINGDON, VIRGINIA – United States Attorney John P. Fishwick Jr. announced an additional two sentences in the ongoing prosecution of a 22-member conspiracy that brought a controlled substance analogue substance to Southwest Virginia from as far away as China.
Joshua Hughes, 28, previously pled guilty to one count of conspiracy to distribute and possess with the intent to distribute 3.3 kilograms of alpha-PVP, a controlled substance analogue, and one count of possession of a firearm in furtherance of a drug trafficking crime. Yesterday in the United States District Court in Abingdon, Hughes was sentenced to 132 months in federal prison.
Brandon Keith Whited, 38, previously pled guilty to one count of conspiracy to distribute and possess with the intent to distribute 2 kilograms of alpha-PVP and one count of possession of a firearm in furtherance of a drug trafficking crime. Today in District Court, Whited was sentenced to 159 months in federal prison.
“The defendants prosecuted as part of this investigation continue to receive lengthy, but just, punishments that show how serious and dangerous controlled substance analogues are to the health and safety of the public,” United States Attorney Fishwick said today. “We will continue to work to slow the flow of these substances into our communities.”
According to evidence presented at previous hearings by Assistant United States Attorney Erin M. Kulpa, the defendants, and others members of the conspiracy, disturbed alpha-PVP, a controlled substance analogue, in Southwest Virginia between 2012 and 2015. Members of the conspiracy placed orders of the powder form of alpha-PVP from distributors based in Florida and China and had these items shipped to residential addresses in Wise, Virginia. The conspirators would retrieve the packages and distribute the contents to mid-and-low level dealers in and around Wise, Virginia for distribution to alpha-PVP users.
Members of the conspiracy also regularly transported the hard form of alpha-PVP, commonly known as “Gravel” from suppliers in North Carolina and Tennessee to Wise, Virginia for distribution. As part of the conspiracy, members would break the larger quantities of “Gravel” into smaller amounts for sale to drug users, typically .5 to 1 gram amounts.
The investigation of the case was conducted by Bureau of Alcohol, Tobacco, Firearms and Explosives, the United States Postal Inspection Service, the Southwest Virginia Drug Task Force, the Virginia State Police, the Big Stone Gap Police Department, the Wise County Sheriff’s Office, the City of Norton Police Department, the Dickenson County Sheriff’s Office, the Sullivan County, Tennessee, Sheriff’s Office, the Coeburn Police Department, the Clintwood Police Department and the Wise Police Department. Assistant United States Attorney Erin M. Kulpa prosecuted the case for the United States.
Two Men Sentenced in Methamphetamine ConspiracyRead the Press Release
United States Attorney Randolph J. Seiler announced that two former residents of the Brookings, South Dakota, area, convicted of conspiracy to distribute methamphetamine, were sentenced on August 19, 2016, by U.S. District Court Judge Karen E. Schreier.
Javier Santos Garcia-Hernandez, age 33, and Juan Francisco Herrera-Rodriguez, age 26, were both sentenced to 121 months in prison, to be followed by 3 years of supervised release. They were also ordered to pay $100 each to the Federal Crime Victims Fund.
Garcia-Hernandez and Herrera-Rodriguez were indicted for Conspiracy to Distribute Methamphetamine by a federal grand jury on May 24, 2016. They were found guilty of the offense on June 3, 2016, after a four-day jury trial.
Beginning in April 2015, the defendants worked together to distribute methamphetamine in Brookings County. They recruited others to sell methamphetamine for them during the conspiracy. Confidential informants working with law enforcement purchased methamphetamine from the defendants on multiple occasions. Several recorded buys were made, and the defendants provided over 200 grams of pure methamphetamine to the informants for distribution. They were arrested on September 15, 2015.
This case was investigated by the South Dakota Division of Criminal Investigation and the Drug Enforcement Administration. Assistant U.S. Attorney Jennifer D. Mammenga prosecuted the case.
Both men were immediately turned over to the custody of the U.S. Marshals Service.
Troy Woman Sentenced for Theft of Government PropertyRead the Press Release
ALBANY, NEW YORK – Catherine M. Kosakavich, age 51, of Troy, New York, was sentenced yesterday to 2 years of probation, and ordered to pay $49,766 in restitution, for unlawfully taking veteran benefits intended for her mother.
The announcement was made by United States Attorney Richard S. Hartunian and Special Agent in Charge Jeffrey G. Hughes of the U.S. Department of Veterans Affairs (VA) Office of Inspector General, Northeast Field Office.
In pleading guilty on March 17, 2016, Kosakavich admitted that as legal guardian for her mother, she received her mother's veteran benefit payment each month. Kosakavich’s mother died on February 18, 2013. Kosakavich failed to notify the VA of her mother’s death and, for almost two and a half years, she stole government property by continuing to receive and spend monthly benefit payments totaling $49,766.
This case was investigated by the U.S. Department of Veterans Affairs, Office of Inspector General, and is being prosecuted by Assistant U.S. Attorney Solomon B. Shinerock.
Third meth mule pleads guilty for role in California-to-West Virginia drug conspiracyRead the Press Release
CHARLESTON, W.Va. – A woman caught transporting a substantial amount of crystal methamphetamine from California to West Virginia pleaded guilty today to a federal drug charge, announced United States Attorney Carol Casto. Cara Linn Monasmith, 46, of Las Vegas, entered her guilty plea to interstate travel in furtherance of a drug crime.
Monasmith admitted that on March 10, 2016, a codefendant, Kelly Newcomb, rented a vehicle in Las Vegas and traveled to California with Monasmith where 10 pounds of crystal methamphetamine were concealed in the vehicle for transportation to West Virginia. Monasmith and Newcomb then began the drive to West Virginia and arrived in Huntington on March 18, 2016. Newcomb rented a room at a Super 8 Motel, and Monasmith and Newcomb followed the instructions of another codefendant by leaving the vehicle unlocked in the parking lot. After their arrival, an undercover officer, in accordance with instructions obtained through a cooperating individual, removed the spare tire where the drugs were concealed.
Monasmith further admitted that in February 2016, as part of the same drug conspiracy, she drove another vehicle containing approximately 10 pounds of crystal methamphetamine hidden in a spare tire from California to Louisville. Once she reached Louisville, another codefendant picked up the methamphetamine and transported the drugs to Charleston for distribution.
Monasmith faces up to five years in federal prison when she is sentenced on November 8, 2016.
This prosecution is the result of a multi-agency investigation which led to an eight-count indictment implicating 14 defendants, including Monasmith. Monasmith’s codefendants are presumed innocent unless and until proven guilty in a court of law. As part of this conspiracy, Daniel Ortiz-Rivera, a Mexican national, and Velarian Sylvester Carter, of Beckley, previously pleaded guilty to conspiring to distribute more than 50 grams of methamphetamine. Ortiz-Rivera is scheduled to be sentenced on October 11, 2016. Carter is scheduled to be sentenced on October 13, 2016. Additionally, two women who were also used as mules to transport methamphetamine, Danielle Dessaray Estrada, of Los Angeles, and Kelly Newcomb, of Nevada, are scheduled to be sentenced on October 6, 2016.
The FBI, Homeland Security Investigations, the United States Postal Inspection Service, the Charleston Police Department, and the Metropolitan Drug Enforcement Network Team conducted the investigation. Assistant United States Attorney Jennifer Rada Herrald is in charge of the prosecution. The plea hearing was held before United States District Judge John T. Copenhaver, Jr.
This case is being prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of illegal drugs, including methamphetamine. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down pill trafficking, eliminating open air drug markets, and curtailing the spread of illegal drugs in communities across the Southern District.
Securities Attorney Sentenced to Prison for Securities Fraud SchemeRead the Press Release
BOSTON – A California-based securities attorney was sentenced yesterday in U.S. District Court in Boston in connection with his role in manipulating the stock of a series of publicly traded companies, including CitySide Tickets, Inc., a Boston-based ticket reseller.
Richard Weed, 53, of Newport Beach, Calif., was sentenced by Senior U.S. District Court Judge Douglas P. Woodlock to four years in prison, three years of supervised release, forfeiture of $90,000 and a fine of $100,000. In May 2016, Weed was convicted following a 10 day trial of conspiracy, securities fraud and wire fraud.
Weed, along with at least two others, conspired to create the appearance that CitySide was a growing company when, in fact, it was in dire financial straits. Weed, who served as CitySide’s Secretary and as one of two members of CitySide’s Board, was responsible for drafting false and misleading legal opinion letters so that his co-conspirators could obtain free trading stock. Weed also helped his co-conspirators to conceal their control and ownership of CitySide by directing the stock to be distributed to different entities that they controlled. This allowed the conspirators to manipulate CitySide’s stock and sell their shares at artificially high prices. In addition to assisting with the manipulation itself, Weed was also responsible for responding to any inquiries from investors or securities regulators.
The conviction follows a multi-year investigation focusing on preventing fraud in the microcap stock markets. Microcap companies are small publicly traded companies whose stock often trades at pennies per share. Fraud in the microcap markets is of increasing concern to regulators as such markets have proven to be fertile grounds for fraud and abuse. This is, in part, because accurate information about microcap stocks may be difficult for the average investor to find, since many microcap companies do not file financial reports with the Securities and Exchange Commission.
The Securities and Exchange Commission, which conducted a parallel civil investigation, cooperated with criminal authorities in bringing this case.
United States Attorney Carmen M. Ortiz and Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division, made the announcement. The case was prosecuted by Assistant U.S. Attorney Sarah E. Walters, Chief of Ortiz’s Economic Crimes Unit and SEC Attorney Eric A. Forni, who was appointed as a Special Assistant U.S. Attorney.
Rochester Man Arrested for Lying on Application for TSA Secure Airport IDRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051ROCHESTER, N.Y.-- U.S. Attorney William J. Hochul, Jr. announced today that Darnell Jerome, 20, of Rochester, NY, was arrested and charged by criminal complaint with making a false statement. The charge carries a maximum sentence of five years in prison and a fine of $250,000.
Assistant U.S. Attorney Craig R. Gestring, who is handling the case, stated that according to the complaint, the defendant applied for employment at a restaurant at the Greater Rochester International Airport. The restaurant was located in the sterile area of the airport, beyond the security screening zone. Employees of the airport or contractors who work in the restaurants or stores inside the sterile area are required to obtain a Security Identification Display Area (SIDA) badge and pass a federal background investigation.
In March 2016, Jerome filled out the application paperwork, including the SIDA badge application forms, and falsely reported that he had never been arrested. However, Jerome was convicted of a felony, Robbery, in Monroe County and sentenced to probation. The defendant’s conviction occurred approximately a month before his false statement on the SIDA badge application form.
Jerome made an initial appearance today before U.S. Magistrate Judge Marian W. Payson and is due back for a status hearing on September 12, 2016 at 9:00 a.m.
The criminal complaint is the culmination of an investigation by the Federal Air Marshal Service, under the direction of Supervisory Air Marshal in Charge William Hall, and in cooperation with the Monroe County NY Probation Office and the U.S. Marshals Fugitive Task Force.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
Retired Wichita Police Lt. Pleads Guilty to Embezzlement, Mail FraudRead the Press Release
WICHITA, KAN. - A retired Wichita police lieutenant pleaded guilty Tuesday to filing false documents so he would be paid $56,400 for providing armed engagement training for law enforcement officers, U.S. Attorney Tom Beall said.
Kevin P. Vaughn, 51, Wichita, Kan., who retired in March 2015 after 28 years with the Wichita Police Department, pleaded guilty to one count of embezzlement of public funds and one count of mail fraud.
In his plea, Vaughn admitted he falsified reports to make it appear his company, Red Mist Tactical, had completed all of 15 eight-hour classes as the company’s contract required. The money for the training came from a grant by the U.S. Department of Homeland Security/Federal Emergency Management Agency (DHS/FEMA) to the Kansas Highway Patrol and the North Central Regional Planning Commission.
Vaughn admitted he:
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Falsely reported conducting training in McPherson, Kan., on May 27 and May 28, 2015. In fact, the training sessions took place on June 3 and 4, 2015, after the deadline in the contract for the training to be completed. He forged officers’ signatures on sign-up sheets.
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Falsely reported conducting eight hours of training on May 22, 2015, during the Wichita Police Department Ladies Range Day. In fact, the training lasted four hours and it was not approved by the police department.
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Falsely reported offering training in Sumner County on April 27 and May 1, 2015. In fact, there was no training on those days.
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Falsely reported offering training in Sumner County on April 20, 21, 22, 23 and 24, 2015. In fact, there was no training on those days.
Sentencing is set for Nov. 16. He faces a penalty of up to 10 years and a fine up to $250,000 on the embezzlement count, and up to 20 years and a fine up to $250,000 on the wire fraud count.
Beall commended the FBI, the Wichita Police Department and Assistant U.S. Attorney Debra Barnett for their work on the case.
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Recidivist Securities Fraud Defendant Edward Durante Pleads Guilty in Manhattan Federal Court to Securities Fraud, Money Laundering, and Perjury OffensesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that EDWARD DURANTE, a/k/a “Ted Wise,” a/k/a “Efran Eisenberg,” a/k/a “Yulia,” a/k/a “Ed Simmons,” pled guilty today before U.S. Magistrate Judge Andrew J. Peck to conspiracy, securities fraud, money laundering, and perjury offenses stemming from a scheme, between 2009 and March 2015, to defraud at least 100 investors of more than $15 million, more than $9 million of which was funneled to DURANTE, his family, or co-conspirators. DURANTE executed the scheme – which principally involved a publicly traded Over-The-Counter company called VGTel, Inc. (“VGTL”) – through false and misleading representations about how private investor monies would be used, making material omissions in connection with the sale of VGTL securities, and through manipulation of the public market in VGTL’s stock. DURANTE, who was previously convicted of similar charges in this District in 2001 and was released from prison in 2009, arrived in the United States in December 2015 following his extradition from Germany. In January 2016, a superseding indictment (the “Indictment”) charging Christopher Cervino, a/k/a “Smitty,” Larry Werbel, and Sheik F. Khan, a/k/a “Abida Khan,” was unsealed and these defendants were arrested and charged for their involvement in the scheme.[1] Two additional participants in the scheme, defendants Kenneth Wise and Walter Reissman, have pled guilty and are cooperating with the Government in this investigation:
U.S. Attorney Preet Bharara said: “Edward Durante embarked on the fraud scheme to which he pled guilty today while still in prison from a prior securities fraud conviction. Doing what he knows best, making money through deception, Durante lied to investors about how their money would be used and concealed his manipulation of the securities market. Edward Durante now awaits sentencing for securities fraud yet again.”
According to the allegations contained in the Indictment filed against DURANTE and his co-conspirators, and statements made in related court filings and proceedings:
2001 Securities Fraud Conviction
In December 2001, DURANTE was convicted in federal court of conspiracy to commit securities fraud, wire fraud, and money laundering, as well as making false statements in connection with a market manipulation scheme in which the defendant also used the alias “Ed Simmons.” The defendant was sentenced to 121 months in prison and was released in or about 2009, the year he began the current scheme. In connection with that scheme, DURANTE was ordered to pay disgorgement and prejudgment interest totaling over $39 million. DURANTE was also barred from certain activities in connection with the securities industry, including the sale of securities.
Private Placement Securities Fraud Involving VGTL
Beginning from when he was first in prison, between 2009 and in or about March 2015, DURANTE and his co-conspirators fraudulently induced victims to invest in private shares of VGTL by, among other things, concealing from investors that DURANTE controlled the entities selling the shares; that DURANTE was prohibited from any association with the sale of securities; and that DURANTE was previously convicted of crimes related to a similar scheme to defraud. Furthermore, some of the defendants lied to investors by (a) representing that their investments would be used to fund the operations and growth of VGTL in connection with potential reverse mergers, when in reality no reverse merger was ever consummated and the investments were instead used primarily to personally benefit the defendants; and (b) representing that the investors would receive an eight percent dividend on their investments until their private shares could be sold at a promised premium on the public market, when, in reality, no interest payments were ever provided to the investors and many investors never received VGTL stock certificates or were not permitted to sell the stock. In order to fund his illegal scheme, DURANTE used a network of brokers, including Werbel and Khan, investment advisers in Cleveland, Ohio, and Los Angeles, California, respectively, to induce investors to buy shares of VGTL.
Manipulation of the Market for Shares of VGTL
DURANTE also engaged in a scheme to control and manipulate the public stock of VGTL in order to artificially inflate the stock price and trading volume so as to profit from sales of VGTL stock and to further induce investments in private shares of VGTL. To that end, through entities he controlled, DURANTE held a majority of the publicly traded stock of VGTL. DURANTE recruited Cervino, a broker, to open brokerage accounts associated with DURANTE-controlled entities and investors who were clients of Werbel and Khan, many of whom did not know they had accounts with Cervino. Werbel and Khan, along with DURANTE, induced their clients to purchase VGTL stock through Cervino – sometimes without the clients’ knowledge or permission – while DURANTE and Cervino ensured that many of these purchases were matched with sales of VGTL stock by DURANTE-controlled accounts. The result of these transactions was that DURANTE and his co-conspirators were effectively taking both sides of a single transaction in VGTL stock in order to artificially control VGTL’s stock price. The defendants’ efforts to artificially inflate the market for VGTL increased the stock price from approximately $.25 per share in April 2012 to as much as $1.90, and dramatically inflated the trading volume, which increased the defendants’ abilities to raise private investments in VGTL. To compensate Cervino for his efforts to control and manipulate the market in VGTL, DURANTE made at least two cash payments to Cervino totaling $35,000. Moreover, DURANTE personally siphoned off more than $4 million in profits, which he concealed through the use of wire transfers among multiple accounts in the names of other individuals.
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DURANTE, 64, pled guilty to one count of conspiracy to commit securities fraud (Count One), one count of securities fraud (Count Two), one count of money laundering (Count Six), and one count of perjury (Count Nine). Count One and Nine each carry a maximum sentence of five years in prison. Counts Two and Six each carry a maximum sentence of 20 years in prison. The charges also carry a maximum fine of $5 million, or twice the gross gain or loss from the offense. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. DURANTE will be sentenced before U.S. District Judge Andrew L. Carter.
On January 4, 2016, Wise, 75, pled guilty before Judge Peck to one count of conspiracy to commit securities fraud, one count of securities fraud, one count of conspiracy to commit wire fraud, one count of wire fraud, one count of conspiracy to commit money laundering, and one count of money laundering. Count One carries a maximum sentence of five years in prison. Counts Two through Six each carry a maximum sentence of 20 years in prison. The charges also carry a maximum fine of $5 million, or twice the gross gain or loss from the offense.
On January 5, 2016, Reissman, 58, pled guilty before Judge Carter to one count of conspiracy to commit securities fraud, one count of securities fraud, one count of conspiracy to commit wire fraud, one count of wire fraud, and one count of making false statements to federal officers. Counts One and Five each carry a maximum sentence of five years in prison. Counts Two through Four each carry a maximum sentence of 20 years in prison. The charges also carry a maximum fine of $5 million, or twice the gross gain or loss from the offense.
Trial against defendants Christopher Cervino, Larry Werbel, and Sheik Khan is scheduled for February 27, 2017, before Judge Carter, on charges of conspiracy to commit securities fraud, securities fraud, conspiracy to commit wire fraud, and wire fraud. Defendants Werbel and Khan will also face trial on charges of investment adviser fraud. Defendants Werbel and Cervino will also face trial on charges of making false statements and perjury, respectively. The allegations contained in the Indictment as to those defendants are merely accusations, and they are presumed innocent unless and until proven guilty.
Mr. Bharara praised the work of the Federal Bureau of Investigation and the U.S. Postal Inspection Service, and thanked the Securities and Exchange Commission for its assistance. He added that the investigation is continuing.
The charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Daniel S. Goldman and Andrea M. Griswold are in charge of the prosecution.
[1] As for the defendants who have not pled guilty (Christopher Cervino, Larry Werbel and Sheik Khan), the charges described herein constitute only allegations.
Postal Employee Charged with Stealing Contents of First Class PackageRead the Press Release
PITTSBURGH - A resident of Butler County, Pennsylvania, has been indicted by a federal grand jury in Pittsburgh on a charge of theft of mail by postal employee, United States Attorney David J. Hickton announced today.
The one-count indictment named Curtis W. Keyser, 54, of Valencia, PA, as the sole defendant.
According to the indictment, Keyser, being an employee of the United States Postal Service, removed and stole the contents of a first class package.
The law provides for a total sentence of 10 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the criminal history, if any, of the defendant.
Assistant United States Attorney Gregory C. Melucci is prosecuting this case on behalf of the government.
The U.S. Postal Service-Office of Inspector General conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Portsmouth Heroin Dealer Sentenced to 21 Years in PrisonRead the Press Release
NORFOLK, Va. – Linwood Taylor, 56, of Portsmouth, was sentenced today to 262 months in prison and eight years of supervised release for conspiracy to manufacture, distribute, and possess with intent to distribute heroin. Taylor was also ordered to forfeit $393,799, which represents the proceeds of the offense for which he pleaded guilty to on May 12.
According to court documents, Taylor distributed in excess of six kilograms of heroin over the course of a year and half in Portsmouth. When Taylor was arrested, his base of operations was a Rodeway Inn motel in Portsmouth where officers from the DEA and the Portsmouth Police Department’s Special Investigative Unit recovered nearly $9,000 in cash, 87 grams of heroin, 10 grams of cocaine, and a hydraulic press. Taylor used the press to give the appearance that the heroin he sold was of high quality and had been freshly removed from a kilogram of raw heroin. Instead, he used cutting agents to double the amount and profits of his heroin sales.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Mark R. Herring, Attorney General of Virginia; and Karl C. Colder, Special Agent in Charge of Drug Enforcement Administration (DEA) Washington Field Division, made the announcement after sentencing by U.S. District Chief Judge Rebecca Beach Smith. Special Assistant U.S. Attorney John F. Butler prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:16-cr-46.
Pine Ridge Man Sentenced for Second Degree MurderRead the Press Release
United States Attorney Randolph J. Seiler announced that a Pine Ridge, South Dakota, man convicted of Second Degree Murder was sentenced on August 15, 2016, by Chief Judge Jeffrey L. Viken, U.S. District Court.
Steven Steele, age 23, was sentenced to 210 months’ custody, followed by 5 years of supervised release, and ordered to pay a $100 special assessment to the Federal Crime Victims Fund.
Steele pleaded guilty to the charge on April 22, 2016. The conviction stems from Steele and others striking the victim with a cinder block, kicking the victim in the head and face, beating the victim with a stick, and striking the victim in the back of his head with a machete on July 12, 2015. The cause of death was multiple blunt trauma to the head, including a skull fracture and hemorrhaging.
This case was investigated by the Bureau of Indian Affairs, Office of Justice Services, the Oglala Sioux Tribe Department of Public Safety, and the Federal Bureau of Investigation. Assistant U.S. Attorney Megan Poppen prosecuted the case.
Steele was immediately returned to the custody of the U.S. Marshals Service.
Pikesville Man Sentenced to Five Years in Federal Prison for Receiving and Possessing Child PornographyRead the Press Release
Baltimore, Maryland – U.S. District Judge Marvin J. Garbis sentenced Jonathan J. Lewin, age 46, of Pikesville, Maryland, today to five years in federal prison, followed by 12 years years of supervised release, for receiving and possessing child pornography. Judge Garbis also ordered that upon his release from prison Lewin must register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation; Special Agent in Charge Andre R. Watson of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); and Chief James W. Johnson of the Baltimore County Police Department.
According to information presented to the court at the plea hearing, Lewin admitted that prior to May 16, 2014, he received child pornography from a file sharing network and that on May 16, 2014, Lewin made child pornography publicly available to other users of a file sharing network using an internet account assigned to his residence. On May 26, 2014, a law enforcement officer engaged in undercover internet investigations for offenders publicly sharing child pornography located a device used by Lewin, which was accessing the internet. The undercover officer downloaded several files that Lewin was sharing over the internet which depicted sexually explicit images of nude prepubescent girls.
On June 12, 2014, law enforcement officers executed a search warrant at Lewin’s home and recovered numerous electronic devices, including an external hard drive, two thumb drives, a tablet computer, a custom built desk top computer, and several cloud accounts. Forensic examination of the computer and other electronic devices revealed thousands of images of child pornography, including the images downloaded by the undercover officer.
Additionally, the forensic examination revealed that Lewin used his cell phone camera to take hundreds of voyeuristic images of young females in public places including the zoo, grocery stores, and parks. Many of these images included zoomed in images of prepubescent female children’s buttocks and appeared to be taken while Lewin was following the children around a park or store. Lewin added sexually explicit text banners to some of these voyeur images. It is clear from the images that the subjects were unaware that they were being followed or photographed. These images were stored on Lewin’s computer and other devices and sorted into individual folders, often by location.
One recurring subject of Lewin’s voyeuristic photographs was a prepubescent female child, age 14, with whom Lewin was acquainted. Lewin had photographs of this girl that were extracted from her and her mother’s social media, without their knowledge and were cropped and zoomed so that she was the focus of the image. Lewin also had photographs of her taken from inside her home and photographs of her exiting a vehicle that Lewin was driving which focused on her backside and buttocks. Lewin saved the images of this child on his computer and other devices in a folder titled in her name.
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. For more information about internet safety education, please visit www.justice.gov/psc and click on the "resources" tab on the left of the page.
United States Attorney Rod J. Rosenstein commended the FBI, HSI Baltimore and Baltimore County Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Sandra K. Wilkinson and Special Assistant United States Attorney Lauren E. Perry, who prosecuted the case.
Penn Hills Man Charged with Illegal Gun PossessionRead the Press Release
PITTSBURGH – An Allegheny County man was indicted by a federal grand jury in Pittsburgh on a charge of violating federal firearms laws, United States Attorney David J. Hickton announced today.
The one-count indictment named Anthony Jackson, 28, of Penn Hills, Pa.
According to the indictment, on November 7, 2015, Jackson possessed a Bryco Arms, Jennings T-380, .380 caliber pistol. It is unlawful for Jackson, who has previously been convicted of multiple felony offenses, to possess a firearm.
The law provides for a maximum total sentence of not less than 15 years and up to life in prison, a fine of up to $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history of the defendant.
Assistant United States Attorney Stephen S. Gilson is prosecuting this case on behalf of the government.
The Federal Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the Pittsburgh Bureau of Police conducted the investigation leading to the indictment in this case. This case is being prosecuted under Project Safe Neighborhoods, a collaborative effort by federal, state and local law enforcement agencies, prosecutors and communities to prevent, deter and prosecute gun crime.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Parmelee Man Sentenced for Assaulting, Resisting,Opposing, and Impeding a Federal OfficerRead the Press Release
United States Attorney Randolph J. Seiler announced that a Parmelee, South Dakota, man convicted of Assaulting, Resisting, Opposing, and Impeding a Federal Officer was sentenced on August 15, 2016, by U.S. District Judge Roberto A. Lange.
Joseph R. Morrisette, III, age 46, was sentenced to one year and one day in custody, followed by two years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Morrisette was indicted by a federal grand jury on April 13, 2016. He pled guilty on June 8, 2016.
The conviction stemmed from an incident on March 15, 2016, when an officer with the Rosebud Sioux Tribe Law Enforcement Services responded to a request for assistance. A woman contacted dispatch in order to have Morrisette removed from the residence, due to his drinking. The officer arrived at the location and made contact with Morrisette. After a field sobriety test was administered by the officer, Morrisette became uncooperative and pulled away from the officer when he attempted to restrain him. An altercation ensued. The officer deployed a burst of pepper spray in Morrisette’s face, and while the officer was attempting to place handcuffs on Morrisette, he struck the officer. The officer deployed a second burst of pepper spray and Morrissette charged at the officer. Morrissette attempted to push the officer out the rear door and down the steps from the top floor of the house. Both the officer and Morrisette ended up outside of the home. Morrisette went back inside the house and locked the door. The officer kicked the door open and Morrisette charged out of the house, swinging a chair at the officer. The officer was able to grab Morrisette’s hands and dropped him to his knees. Morrisette then became compliant with the officer.
This case was investigated by the Rosebud Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Carrie G. Sanderson prosecuted the case.
Morrisette was immediately turned over to the custody of the U.S. Marshals Service.
Ozark Man Sentenced for False Tax Claim, Advertised on Craigslist for DependentsRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that an Ozark, Mo., man was sentenced in federal court today for filing a false income tax return after he advertised on Craigslist to purchase identity information for children that he could claim as dependents as part of a larger tax fraud scheme.
Raheem L. McClain, 37, of Ozark, was sentenced by U.S. District Judge M. Douglas Harpool to one year and one day in federal prison without parole. The court also ordered McClain to pay $23,883 in restitution ($22,378 to the Internal Revenue Service and $1,505 to the Missouri Department of Revenue).
On April 6, 2016, McClain pleaded guilty to a scheme to defraud the IRS by preparing and submitting false tax returns on behalf of himself and his girlfriend (who is not identified in court documents) between Jan. 28, 2012, and Feb. 4, 2016. McClain prepared and submitted false federal tax returns for the years 2011, 2012, 2013 and 2014 claiming dependents to which he was not entitled to claim. McClain also prepared and submitted false federal tax returns for his girlfriend for the years 2012, 2013, 2014 and 2015 claiming dependents to which she was not entitled to claim.
For tax returns filed for the calendar years 2011, 2012 and 2013 McClain admitted that he used the personal information for three dependents from a female he met on an on-line dating website to falsely claim these children as dependents and to falsely claim refunds for himself and his girlfriend. For a tax return filed for the calendar year 2014, McClain falsely listed his grandmother as a dependent on his girlfriend’s tax return.
McClain also admitted that he caused an advertisement to be posted on Craigslist on Jan. 16, 2015, stating:
“WANTED: KIDS TO CLAIM ON INCOME TAXES - $750 (SPRINGFIELD,
MO)
IF YOU HAVE SOME KIDS YOU ARENT CLAIMING, I WILL PAY YOU A
$750 EACH TO CLAIM THEM ON MY INCOME TAX. IF INTERESTED,
REPLY TO THIS AD.”
On Feb. 3, 2015, McClain caused a false federal tax return to be electronically signed and filed in his name for 2014, which listed three dependents by name, Social Security number and supposed relationship (two sons and one daughter). He obtained the personal information for these dependents from a woman who responded to his Craigslist advertisement.
On Feb. 4, 2015, McClain caused two false federal tax returns to be filed through the mail in his name for 2012 and 2013. Each of the returns listed the same three dependents; however, on these two returns the same individuals were listed as one son and two daughters. The woman who responded to the advertisement did not authorize McClain to use the dependent information on his 2012 tax return.
On Feb. 4, 2016, McClain caused a false federal tax return to be electronically signed and filed in the name of his girlfriend for 2015, which listed the same three dependents but claimed them as one nephew and two nieces. The woman who sold the dependent information was unaware that McClain used the dependents on his girlfriend’s 2015 tax return.
This case was prosecuted by Assistant U.S. Attorney Steven M. Mohlhenrich. It was investigated by IRS-Criminal Investigation and the Missouri Department of Revenue.
Owner of Mexican Restaurant Chains Sentenced to Federal Prison for Tax EvasionRead the Press Release
GRAND RAPIDS, Mich. – Marco Cuellar, 37, of Hudsonville, Michigan, was sentenced in U.S. District Court to serve 12 months in prison for filing false tax returns, U.S. Attorney Patrick A. Miles, Jr. announced today. Before his sentencing, Cuellar, who owns and co-owns numerous Mexican restaurant chains in Michigan, Indiana and Ohio, was also required to pay approximately $370,000.00 in restitution to the Internal Revenue Service in back taxes and penalties. U.S. Attorney Miles was joined in the announcement by Special Agent in Charge Manny Muriel, Internal Revenue Service, Criminal Investigations Division.
According to his plea-agreement with the U.S. Attorney’s Office, Cuellar filed false tax returns for 2008 through 2012 with the Internal Revenue Service. During those years, Cuellar skimmed cash from his restaurants located in Michigan and then failed to report that income in his tax returns for those years; as a result, Cuellar avoided paying taxes on $607,914.00 of unreported income.
"Successful business owners have the same legal duty to pay their taxes as any other taxpayer, and any business owner who uses his or her business to cheat the tax-paying public has to understand that he or she runs the real risk of winding up as a defendant in Federal court," stated U.S. Attorney Miles. "Mr. Cuellar ran that risk, and now he’s on his way to prison."
"Cheating on your taxes is the same as stealing," said Special Agent in Charge, Manny Muriel, of IRS Criminal Investigation. "Individuals who corruptly violate the law to further their business interests and intentionally evade paying their fair share of taxes undermine public confidence in our tax system and unfairly disadvantage businesses that follow the rules. As Marco Cuellar has discovered, operating outside the law and failing to pay taxes has severe consequences."
As a citizen of Mexico who is present in the United States as a lawful permanent resident, Cuellar also faces removal proceedings back to Mexico once he is released from the Bureau of Prisons.
This case was prosecuted by Assistant U.S. Attorney Hagen W. Frank, and was investigated by Special Agents of the IRS Criminal Investigation Division and Homeland Security Investigations, U.S. Immigration and Customs Enforcement.
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