Latest Records
Newest first across public DOJ and U.S. Attorney press releases.
Friday 20 May 2016
Oregon Woman Pleads Guilty in $1.2 Million Federal Income Tax Refund Fraud SchemeRead the Press Release
WASHINGTON – An Oregon woman pleaded guilty today to one count of conspiracy to defraud the government with respect to claims, one count of wire fraud and one count of aggravated identity theft for running a federal income tax refund fraud scheme, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division, U.S. Attorney Billy J. Williams of the District of Oregon and Special Agent in Charge Teri Alexander of the Internal Revenue Service – Criminal Investigation (IRS-CI).
Danyelle Calcagno, 41, admitted to filing at least 224 false federal income tax returns that fraudulently claimed a total of $1,220,246 in tax refunds, generally between $3,500 and $7,000 per return. Calcagno filed the fraudulent tax returns using Internet access at Portland-area hotels to disguise the source of filing. Calcagno filed the false tax returns using the names and social security numbers of other individuals obtained directly and through recruiters, including Latisha L. Simmons, 36, of Phoenix, Arizona.
Calcagno directed the IRS to deposit the income tax refunds into bank accounts and onto stored value debit cards that she could access and control in order to divide the proceeds of the fraud and make it more difficult for law enforcement to identify Calcagno as the filer of the false tax returns. Calcagno received at least $25,000 in fraudulently obtained income tax refunds into her own bank accounts.
Calcagno faces a statutory maximum sentence of 10 years in prison on the conspiracy charge, 20 years in prison on the wire fraud charge and a mandatory term of two years in prison on the aggravated identity theft charge, which will be in addition to any other term of imprisonment she receives. Calcagno also faces financial penalties and a term of supervised release. As part of her plea agreement, Calcagno agreed to pay restitution to the IRS in the amount of $742,754.
In October 2015, Simmons was sentenced to 39 months in prison after pleading guilty to one count of wire fraud, one count of false claims against the government and one count of aggravated identity theft. According to her plea agreement, Simmons filed more than 50 false tax returns with the IRS that fraudulently claimed more than $400,000 in refunds.
Acting Assistant Attorney General Ciraolo, U.S. Attorney Williams and Special Agent in Charge Alexander thanked special agents of IRS-CI, who investigated this case and Trial Attorney Leslie A. Goemaat of the Tax Division and Assistant U.S. Attorney Quinn P. Harrington of the District of Oregon, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Operator of Alleged Cybercrime Marketplace Extradited to the United States to Face ChargesRead the Press Release
On Friday, May 20, 2016, a complaint was unsealed in Brooklyn federal court charging Djevair Ametovski, a Macedonian citizen also known as “codeshop,” “sindrom,” and “sindromx,” with crimes related to his operation of the website Codeshop.su, a website allegedly created for the sole purpose of selling illegally obtained credit and debit card data and personal identification information for financial gain. The charges include aggravated identity theft, access device fraud conspiracy, and wire fraud conspiracy. The defendant is scheduled to be arraigned at 11 a.m. tomorrow, May 21, 2016, before United States Magistrate Judge Roanne L. Mann at the U.S. Courthouse, 225 Cadman Plaza East, Brooklyn, New York.
The charges were announced by Robert L. Capers, United States Attorney for the Eastern District of New York, and David E. Beach, Special Agent in Charge, United States Secret Service, New York Field Office.
“Cybercriminals who create and operate online criminal marketplaces in which innocent victims’ financial and personal information are bought and sold erode consumer trust in modern-day payment systems and cause millions of dollars in losses to financial institutions and unsuspecting individuals. Today marks a major step in bringing the alleged operator of one such criminal marketplace to justice, and should serve as a warning to others who seek to profit from perpetuating these fraudulent schemes,” stated United States Attorney Capers. Mr. Capers cited the extraordinary efforts of the Secret Service, the agency responsible for leading the government’s investigation, and also thanked the Slovenian Ministry of the Interior and Ministry of Justice, for their assistance in the investigation and effecting the defendant’s extradition, the United States Marshals Service, for their assistance in transporting the defendant to the United States, and the U.S. Department of State Regional Security Officers in Slovenia and the Netherlands, for their assistance in facilitating the defendant’s extradition.
“Today’s extradition of alleged cybercriminal Djevair Ametovski from Central Europe is the culmination of a seven-year investigation and demonstrates the relentless pursuit by the Secret Service and its international partners to bring cybercriminals to justice. Multinational cyber investigations require establishing critical partnerships with our international law enforcement partners. The immeasurable assistance provided to our New York Electronic Crimes Task Force by the Slovenian Authorities in this case illustrates that our investigative reach will continue to expand beyond the borders of the United States,” said Special Agent in Charge Beach of the United States Secret Service New York Field Office.
As detailed in the complaint, Ametovski obtained valuable data from hackers, who stole it from financial institutions and other businesses or from individuals using “phishing” tactics.[1] Ametovski then sold the data on his website, a fully indexed and searchable website that allowed users to search through databases of stolen data by bank identification number, financial institution, country, state, and card brand to find the precise data that they wished to buy. Individuals who bought data from the website generally used it to make online purchases and to encode plastic cards with the data and use the cards to withdraw cash at ATMs. Ametovski used a network of online money exchangers and digital currencies to pay the hackers who fed him data and to receive payments from the website users who bought data in order to conceal all participants’ identities, including his own. Over the course of the scheme, Ametovski obtained and sold credit and debit card data for more than 181,000 different cards. In many instances, the data included personal details associated with the account holder, including email address, billing address, phone number, and account holder name. The charged scheme resulted in millions of dollars in financial losses to thousands of victims around the world.
Ametovski was arrested in Ljubljana, Slovenia, on January 22, 2014, and was extradited to the United States today.
The charges in the complaint are allegations, and the defendant is presumed innocent unless and until proven guilty.
The government’s case is being handled by the Office’s National Security & Cybercrime Section. Assistant United States Attorneys Una Dean, Saritha Komatireddy, and Hilary Jager are in charge of the prosecution. Substantial assistance was provided by Marcus Busch of the Justice Department’s Office of International Affairs.
The Defendant:
DJEVAIR AMETOVSKI
Alias: Codeshop, Sindrom, Sindromx
Age: 29
Nationality: Macedonian E.D.N.Y. Docket No. 14 M 058
[1] “Phishing” is a common cyber fraud tactic that involves sending an email to a user falsely claiming to be an established legitimate enterprise in an attempt to scam the user into surrendering private information. In this case, such emails commonly directed users to visit a bogus website where they were asked to update personal information, such as passwords and credit card, social security, and bank account number previously provided to a legitimate organization.
Officials from the U.S., Canada and Mexico Participate in 2016 Trilateral Meeting in Toronto to Discuss Antitrust EnforcementRead the Press Release
The heads of the antitrust agencies of the United States, Canada and Mexico met today in Toronto to discuss their ongoing work to ensure effective antitrust enforcement cooperation in our increasingly interconnected markets.
The meetings were held among Principal Deputy Assistant Attorney General Renata Hesse of the Department of Justice’s Antitrust Division, Chairwoman Edith Ramirez of the Federal Trade Commission, Canadian Commissioner of Competition John Pecman and President Alejandra Palacios Prieto of the Mexican Federal Economic Competition Commission.
The discussions covered a wide range of topics, including recent developments, effective agency litigation, disruptive innovation, cooperation between agencies and technical assistance.
“We are very fortunate to have such strong relationships with our partners in Canada and Mexico,” said Principal Deputy Assistant Attorney General Hesse. “In this increasingly globalized economy, close cooperation with our North American colleagues is important to protecting the competitiveness of our markets. These meetings are a useful part of our ongoing enforcement collaboration, and they provide a great opportunity to discuss our shared competition policy challenges.”
“The antitrust relationship among the United States, Canada and Mexico is one of the most advanced in the world,” said Chairwoman Ramirez. “We work together on cross-border cases to ensure effective and compatible enforcement and on policy matters to promote convergence toward best practices. Our meeting enables us to strengthen our cooperation to enhance competition and benefit our consumers.”
The meetings build on the foundations laid by the 1995 antitrust cooperation agreement between the United States and Canada, the 1999 agreement between the United States and Mexico and the 2001 agreement between Canada and Mexico. The agreements commit the antitrust agencies to cooperate and coordinate with each other to make their antitrust policies and enforcement as consistent and effective as possible.
The four agency heads also spoke at an enforcers’ roundtable at the spring conference of the Canadian Bar Association’s Competition Law Section, which included exchanges among the four agency heads on international cooperation, disruptive innovation and merger remedies.
Methamphetamine Trafficker Sentenced to 12.5 Years in PrisonRead the Press Release
ASHEVILLE, N.C. – Joel Elias Gonzalez, 53, formerly of Franklin, N.C. was sentenced yesterday to 151 months in prison followed by five years of supervised release for trafficking large quantities of crystal methamphetamine, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Gonzalez pleaded guilty in February 2016 to one count of distribution of methamphetamine.
U.S. Attorney Rose is joined in making today’s announcement by Daniel R. Salter, Special Agent in Charge of the Atlanta Field Division of the Drug Enforcement Administration (DEA), which oversees the Charlotte District Office; C.J. Hyman, Special Agent in Charge of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Charlotte Field Division; Sheriff Robert L. Holland of the Macon County Sheriff’s Office; and Sheriff Chip Hall of the Jackson County Sheriff’s Office.
According to filed court documents and statements made in court, from in or about June of 2015, Gonzalez was responsible for trafficking large amounts of crystal methamphetamine (crystal meth) in the Franklin, N.C. area and the Rabun County, Georgia area. Court records indicate that Gonzalez purchased the crystal meth from a source of supply in and around Atlanta, Georgia. According to court records, Gonzalez and was responsible for trafficking approximately 1.3 kilograms of crystal meth.
Gonzalez is in federal custody and will be transferred to custody of the Bureau of Prisons upon designation of a federal facility. Federal sentences are served without the possibility of parole.
In making today’s announcement, U.S. Attorney Rose noted that multiple agencies worked together to bring this prolific crystal methamphetamine trafficker to justice and thanked the DEA, the ATF, the Macon County Sheriff’s Office, the Jackson County’s Sheriff’s Office for investigating this case.
Assistant United States Attorney Thomas Kent of the U.S. Attorney’s Office in Asheville handled the prosecution.
Maryland Man Pleads Guilty to Conspiracy to Defraud the United StatesRead the Press Release
PITTSBURGH - A Maryland resident pleaded guilty in federal court to a charge of conspiracy to defraud the United States, United States Attorney David J. Hickton announced today.
Simon T. Tusha, 43, of Forest Hill, Maryland pleaded guilty to one count of conspiracy to obstruct and impede the IRS before United States District Judge Terrance F. McVerry.
In connection with the guilty plea, the court was advised that Tusha, who during the relevant time was employed by a large international corporation in order to enter into agreements with data centers in the United Kingdom and the Netherlands, had taken kickback or bribe payments from a company called Trammell-Crow Netherlands (TCN) and from a company called Evolved IT in the United Kingdom. The payments were in connection with favorable treatment and advantageous agreements that TCN and Evolved IT received from Tusha’s employer that they would not have received in the absence of his intervention. The evidence presented to the Court showed that during the time period 2008 through 2010 Tusha received in excess of $2,700,000 in payments that he did not report on his income tax returns, leaving a tax due of more than $960,000.
Judge McVerry scheduled sentencing for Sept. 16, 2016. The law provides for a total sentence of not more than five years in prison, a fine of up to $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
The Internal Revenue Service, Criminal Investigations and the Department of Homeland Security Investigations conducted the investigation that led to the prosecution of Tusha.
Local Physician Pleads Guilty to Health Care FraudRead the Press Release
ROCKFORD — A suspended physician pleaded guilty today in federal court to charges of health care fraud. CHARLES S. DEHANN, 61, of Belvidere, Ill., pleaded guilty before Judge Frederick J. Kapala to two counts of health care fraud in a scheme to defraud Medicare that included overbilling and billing Medicare for treatment of patients that were already deceased.
According to the written plea agreement, DeHaan, during the course of the scheme, was a physician licensed in Illinois, who between January 2009 and January 24, 2014, primarily billed Medicare for in-home patient visits and certifications for patients he deemed homebound. DeHaan admitted in the plea agreement that he knew Medicare authorized payment for home visits and physician services only if those services were actually provided and were medically necessary because of disease, infirmity, or impairment. The plea agreement further states that DeHaan billed Medicare for medical services purportedly provided to patients when he knew he did not provide any reimbursable medical service. This included DeHaan billing Medicare at the highest reimbursement levels for routine, non-complex visits with new and established patients even though DeHaan knew the visit did not qualify for the highest levels of reimbursement, and billing Medicare for patients DeHaan never actually treated. According to the plea agreement, some of the patients DeHaan billed at the highest reimbursement levels but did not actually see were deceased on the date of the alleged visit.
On each count DeHaan faces a maximum potential penalty of up to 10 years in prison, a term of supervised release of up to 3 years following imprisonment, and a fine of up to $250,000, or twice the gross gain or gross loss resulting from that offense, whichever is greater, as well as full restitution. Sentencing for DeHaan is scheduled for Sept. 21, 2016, at 9:30 a.m.
The guilty plea was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Michael Anderson, Special Agent-in-Charge of the Chicago Office of Federal Bureau of Investigation; and Lamont Pugh, III, Special Agent-in-Charge of the Chicago Regional Office of the U.S. Department of Health and Human Services Office of Inspector General. The Illinois Department of Financial and Professional Regulation assisted in the investigation.
The government is represented by Assistant U.S. Attorneys Scott R. Paccagnini and Talia Bucci.
Plea Agreement
Liverpool Man Pleads Guilty to Child Exploitation ChargesRead the Press Release
SYRACUSE, NEW YORK – Jason Kopp, 40, of Liverpool, New York pled guilty today to all twenty-two counts of an indictment charging him with the exploitation of children as well as the possession and distribution of child pornography, announced United States Attorney Richard S. Hartunian and FBI Resident Agent in Charge Andrew Vale of the FBI Albany Division.
"The sexual abuse of infants and toddlers is conduct at the deepest depths of depravity, and the production of child pornography perpetuates the victimization. Today’s guilty plea highlights the FBI's sustained success identifying and arresting such child sexual predators. We will seek a sentence commensurate with the gravity of these crimes," said U.S. Attorney Hartunian.
"The FBI stands determined with our law enforcement partners to stem the tide of child exploitation," said Special Agent in Charge Andrew W. Vale. "Predators like Mr. Kopp victimize the most innocent among us and he will be held accountable for his heinous and unspeakable crimes."
The investigation began on March 4, 2016 when a Task Force Officer assigned to the Washington, D.C. Metropolitan Police Department-Federal Bureau of Investigation Child Exploitation Task Force (Washington Field Office), acting in an undercover capacity, began texting with Jason Kopp, who was using a screen name of "daymein39" and who also displayed the initials "JK." In texts between the two, Jason Kopp told the undercover officer that he had pictures of a female infant that had been sent to him by a woman acquaintance and distributed images of the infant to the officer. FBI Special Agents, assisted by the New York State Police, arrested Jason Kopp in Liverpool, New York on March 18, 2016.
As part of his guilty plea today Jason Kopp admitted that he and another person conspired to sexually exploit the infant for the purpose of producing visual depictions of the abuse. Kopp also admitted to ten separate events in which he exploited children for the purpose of producing images and videos of the abuse. In addition to the exploitation of the infant, Kopp’s offenses included the exploitation of a male toddler-aged child. He also pled guilty to nine separate counts of distributing the images he and another person produced, and to two counts of possessing child pornography he had downloaded from the Internet.
Sentencing is scheduled for September 14, 2016. For his convictions for Conspiracy to Sexually Exploit a Child (count 1) and Exploitation of a Child (counts 2,3,6,7,8,9,10,11,12, and 13) Kopp faces a mandatory minimum sentence of fifteen (15) years and a maximum sentence of thirty (30) years on each count. For his convictions for Distribution of Child Pornography (counts 14,15,16,17,18,19,20,21and 22) he faces a mandatory minimum sentence of five (5) years, and a maximum of 20 years on each count, and for his convictions for Possession of Child Pornography (counts 27 and 28), he faces a maximum sentence of twenty (20) years imprisonment. Sentences of imprisonment may be concurrent or consecutive at the discretion of the Court. The Court may also impose a fine of up to $250,000 per count, and must impose a term of supervised release of between five (5) years and life. Kopp will also be required to register as a sex offender.
This case is being investigated by the Albany Division of the FBI (Syracuse Resident Agency), the New York State Police and the Metropolitan Police Department-Federal Bureau of Investigation Child Exploitation Task Force (Washington Field Office), and is being prosecuted by Assistant U.S. Attorneys Lisa Fletcher and Robert Levine.
Launched in May 2006 by the Department of Justice, Project Safe Childhood is 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 https://www.justice.gov/psc.
Law Enforcement Officials Among 15 Charged in Drug Trafficking ConspiracyRead the Press Release
HOUSTON – A grand jury sitting in Houston has returned an 11-count indictment against several individuals to include current or former law enforcement officers, in a cocaine trafficking conspiracy, announced U.S. Attorney Kenneth Magidson.
U.S. Border Patrol Agent Daniel Polanco, 34, and Edinburg Police Officer Hector Beltran, 40, both of Edinburg, surrendered to federal authorities today. Former Houston Police Officer Marcos Esteban Carrion, 38, of Sugar Land, was already in custody on unrelated charges and is expected to make an initial appearance in the near future. A summons has also been issued for former Precinct 7 Deputy Constable Juan Ignacio Leal, 36, of Houston, who is expected to appear in Houston federal court May 31.
Also charged are Noe Arnoldo Moczygemba, 42, and Carlos Aaron Oyervides, 41, both of Houston; Angel Alberto Lopez-Rodriguez, 42, a Mexican national residing in Mission; Dimas DeLeon-Rios, 41, a Mexican national of Edinburg; Carmen Meyer, 60, and Maritssa Salinas, 38, both of Mission; Mario Alejandro Solis, 37, a Mexican national residing in San Juan; Martin Peña, 59, a citizen of the Dominican Republic residing in Houston; Ruben Angel Nava-Perez, 29, a Mexican national residing in Katy; and Francisco Arizmendiz-Lugo, 51, and Jesus Alejandro Martinez-Lopez, 37, both of Reynosa, Tamaulipas, Mexico.
Lopez-Rodriguez, DeLeon-Rios, Oyervides, Meyer, Solis, Peña and Nava-Perez are currently in custody and set to make an appearance May 31, 2016, before U.S. Magistrate Judge Dena Palermo in Houston. Moczygemba and Salinas are also expected to be in custody in the near future.
Arizmendiz-Lugo and Martinez-Lopez are considered fugitives and warrants remain outstanding for their arrests. Anyone with information about their whereabouts are asked to contact DEA at 713-693-3000.
The superseding indictment, returned May 18, 2016, charges all 15 with conspiracy to possess with intent to distribute more than five kilograms of cocaine. Each defendant also faces varying numbers of charges of possession with intent to distribute cocaine. Lopez-Rodriguez is charged with one count of possession with the intent to distribute methamphetamine.
Each defendant faces a minimum of 10 years and up to life in federal prison as well as a possible $10 million fine on each count of conviction.
The four-year Organized Crime Drug Task Force Investigation dubbed Operation Blue Shame was investigated by the Drug Enforcement Administration, Homeland Security Investigations and Internal Revenue Service – Criminal Investigations. Assistant U.S. Attorney Anibal J. Alaniz is prosecuting the case.
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless and until convicted through due process of law.
Kalamazoo, Michigan, Man Charged with Multiple Counts of Sex Trafficking and Interstate Transportation for ProstitutionRead the Press Release
David Q. Givhan, 34, of Kalamazoo, Michigan, was charged by grand jury indictment, unsealed late yesterday, with multiple counts of sex trafficking and interstate transportation for prostitution, announced Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division and U.S. Attorney John E. Kuhn Jr. of the Western District of Kentucky.
Givhan was arrested on May 18, 2015, and appeared before Magistrate Judge Colin H. Lindsay of the Western District of Kentucky on May 19, 2016. Givhan is charged with three counts of interstate transportation for prostitution and two counts of sex trafficking an adult by force, fraud or coercion.
According to the indictment, the alleged criminal acts occurred between October 2014 and May 2015, and involved three women over the age of 18. The three women were transported by Givhan from Michigan to Kentucky to engage in prostitution.
The indictment also alleges that Givhan recruited and transported two of the women, knowing and in reckless disregard of the fact that means of force, threats of force, fraud and coercion, would be used to cause them to engage in commercial sex acts.
An indictment is merely an allegation, and the defendant is presumed innocent until proven guilty. If convicted, his maximum sentence for the interstate transportation for prostitution charges is 10 years in prison. For the sex trafficking charges, his maximum sentence is life in prison.
This case is being investigated by the FBI’s Louisville, Kentucky, Division and Louisville Metro Police Department. The case is being prosecuted by Assistant U.S. Attorney Amanda E. Gregory of the Western District of Kentucky and Trial Attorney William Nolan of the Civil Rights Division’s Human Trafficking Prosecution Unit.
Givhan Indictment
Kalamazoo, Michigan, Man Charged with Multiple Counts of Sex Trafficking and Interstate Transportation for ProstitutionRead the Press Release
WASHINGTON – David Q. Givhan, 34, of Kalamazoo, Michigan, was charged by grand jury indictment, unsealed late yesterday, with multiple counts of sex trafficking and interstate transportation for prostitution, announced Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division and U.S. Attorney John E. Kuhn Jr. of the Western District of Kentucky.
Givhan was arrested on May 18, 2015, and appeared before Magistrate Judge Colin H. Lindsay of the Western District of Kentucky on May 19, 2016. Givhan is charged with three counts of interstate transportation for prostitution and two counts of sex trafficking an adult by force, fraud or coercion.
According to the indictment, the alleged criminal acts occurred between October 2014 and May 2015, and involved three women over the age of 18. The three women were transported by Givhan from Michigan to Kentucky to engage in prostitution.
The indictment also alleges that Givhan recruited and transported two of the women, knowing and in reckless disregard of the fact that means of force, threats of force, fraud and coercion, would be used to cause them to engage in commercial sex acts.
An indictment is merely an allegation, and the defendant is presumed innocent until proven guilty. If convicted, his maximum sentence for the interstate transportation for prostitution charges is 10 years in prison. For the sex trafficking charges, his maximum sentence is life in prison.
This case is being investigated by the FBI’s Louisville, Kentucky, Division and Louisville Metro Police Department. The case is being prosecuted by Assistant U.S. Attorney Amanda E. Gregory of the Western District of Kentucky and Trial Attorney William Nolan of the Civil Rights Division’s Human Trafficking Prosecution Unit.
Jury Finds Jackson Man Guilty in Armed Carjacking CaseRead the Press Release
Jackson, Miss - Following a three day trial in United States District Court in Jackson, a jury found Lindsey Johnson, age 28, of Jackson, guilty of armed carjacking, felon in possession of a firearm, and brandishing a firearm during the commission of a felony, announced U.S. Attorney Gregory K. Davis.
The crime took place on August 2, 2015 at the Northwood Village Apartments in Jackson. The victim had been visiting relatives in the apartment complex when Lindsey Johnson approached him with a .38 caliber revolver. Johnson demanded that the victim get out of the car and give him any money that he had on his person. Johnson then left the apartments in the victim’s Lexus automobile and was later spotted by Jackson Police officers. He led JPD officers on a high speed chase through the city of Jackson where they were able to safely apprehend him. JPD officers and federal agents with the bureau of Alcohol, Tobacco, Firearms, and Explosives recovered two weapons from the vehicle.
Johnson will be sentenced by U.S. District Judge William H. Barbour on August 2, 2016 at 9:00 a.m. The maximum penalty for the carjacking offense is 15 years in federal prison and a $250,000 fine. The maximum penalty for the felon in possession of a firearm offense is 10 years in federal prison and a $250,000 fine. The maximum penalty for brandishing a firearm during the commission of a felony is 7 years in federal prison and, under federal law, must run consecutive to the time he will receive on the first two counts.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives along with the Jackson Police Department, and prosecuted by Assistant U.S. Attorney Abe McGlothin, Jr. and Deputy Criminal Chief Darren Lamarca.
Hudson County, New Jersey, Man Sentenced to 30 Years in Prison for Armed Robbery Spree of North Jersey Banks and RestaurantsRead the Press Release
NEWARK, N.J. – A North Bergen, New Jersey, man was sentenced today to 360 months in prison for leading an armed robbery spree of banks and commercial establishments in Bergen and Hudson counties in July 2013, U.S. Attorney Paul J. Fishman announced.
Gary Bohanan, 47, previously pleaded guilty before U.S. District Judge Claire C. Cecchi in July 2014 to a superseding indictment charging him with one count of conspiracy to commit armed bank robberies and Hobbs Act robberies, two counts of armed bank robbery, and two counts of armed Hobbs Act robbery. Judge Cecchi imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
On July 10, 2013, Bohanan and Ramon Lopez, 25, of Union City, New Jersey, donned masks and entered a McDonald’s restaurant in North Bergen. Bohanan brandished a handgun and demanded money from the employees. Bohanan and Lopez then took $1,600 from the cash registers and fled in a car driven by Josephine Chenet, formerly of North Bergen.
On July 18, 2013, Bohanan, Angel Feliu, 22, of North Bergen, Lopez, and Chenet cased Le Chateau restaurant in West New York, New Jersey, for the purpose of robbing it. After waiting for an employee to close the restaurant, Bohanan and the other individuals followed the employee home and robbed her at gunpoint of $6,000 in proceeds from the restaurant.
On July 22, 2013, Bohanan, Feliu, and Chenet robbed the Sovereign Bank (now Santander Bank) in Secaucus, New Jersey. Bohanan and Feliu entered the bank at 10:11 a.m. Both men wore latex gloves and masks. Once inside the Sovereign Bank, Bohanan jumped over the counter and proceeded to empty two drawers of money into a black bag, while pointing a black handgun at the bank tellers. As Bohanan emptied the drawers, Feliu stood guard. Bohanan and Feliu then fled the bank with $21,961 and shared the proceeds of the robbery with Lopez and Chenet.
On July 26, 2013, Bohanan, Feliu, and Chenet robbed the TD Bank in Fairview, New Jersey. Bohanan and Feliu entered the bank at 9:48 a.m. Bohanan and Feliu both wore latex gloves and masks. Feliu, however, was captured by the bank’s video surveillance system before he pulled the mask on. Feliu brandished a knife at employees and customers. Bohanan brandished what appeared to be a black handgun, but was later identified as an air pistol. Bohanan then jumped over the counter and emptied two drawers of money into a black bag, while pointing the air pistol at bank tellers. As Bohanan emptied the drawers, Feliu stood guard and held bystanders back by brandishing the knife.
Bohanan and Feliu fled on foot and were followed by concerned citizens and victims of the bank robbery. Bohanan encountered a white GMC Savana van, pointed the air pistol at the driver and ordered the driver out. Bohanan then attempted to flee the area by driving away in the van, but crashed it into a nearby structure after a short distance, at which point he attempted to flee the area on foot.
Law enforcement and concerned citizens located Bohanan hiding under a truck parked a short distance away. He had with him a black bag containing a black air pistol and money covered with red dye. Feliu separated from Bohanan after the bank robbery and fled in a car driven by Chenet. Shortly thereafter, Feliu exited Chenet’s vehicle and fled on foot into a nearby cemetery where he was located and arrested.
In addition to the prison term, Judge Cecchi sentenced Bohanan to five years of supervised release.
Feliu pleaded guilty in a separate proceeding to one count of conspiracy to commit armed bank robberies and Hobbs Act robberies and two counts of armed bank robbery. Feliu was sentenced in March 2015 to 46 months in prison. Lopez also pleaded guilty in a separate proceeding to one count of conspiracy to commit armed bank robberies and Hobbs Act robberies and two counts of Hobbs Act robberies. Lopez was sentenced in March 2015 to 47 months in prison. Charges that had been pending against Chenet for her role in the robberies were dismissed due to her death on June 22, 2014.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation. He also thanked the Fairview, North Bergen, and Secaucus police departments for their contributions to the case.
The government is represented by Assistant U.S. Attorney Francisco J. Navarro of the U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel: Michael Pedicini Esq., Chatham, New Jersey
Heroin Trafficking Conspiracy Broken UpRead the Press Release
But Opioid Addiction a Growing Problem Regionally and Nationally
MARQUETTE, MICHIGAN — United States Attorney Patrick A. Miles, Jr., announced the results of a joint investigation by the U.S. Drug Enforcement Administration (DEA), the Michigan State Police and its drug team, the Upper Peninsula Substance Enforcement Team (UPSET), and the Forsyth Township Police Department into heroin trafficking from Detroit to Marquette County from 2012 to 2015.
The investigation led to convictions of the following people:
Lamarol Travron Abram, age 39, of Detroit, Michigan, was sentenced to 170 months in federal prison after being convicted of conspiracy to distribute and possess with intent to distribute heroin and cocaine from 2012 to 2015. Abram’s case was transferred to the Eastern District of Michigan. He was convicted there and sentenced by U.S. District Judge John C. O’Meara in Ann Arbor on March 10, 2016.
Megan Marie Tinney, age 25, of Gwinn, Michigan, was sentenced to 46 months in federal prison after being convicted of the conspiracy charge along with Abram. U.S. District Judge R. Allan Edgar sentenced Tinney in Marquette on May 18, 2016.
Jimmy Wayne McFied, age 33, of Gwinn, Michigan, was sentenced by U.S. District Judge Robert Holmes Bell to 48 months in prison following a conviction for distribution of heroin.
Carlton Murray, Jr., age 37, of Gwinn, Michigan, was sentenced by Judge Edgar to 30 months in federal prison after being convicted of possession of heroin and cocaine with intent to distribute.
Rachel Lynn Hanson, age 32, of Ishpeming, Michigan, was sentenced by Judge Bell to 151 months in federal prison after being convicted of possession of cocaine with intent to distribute.
These convictions do not end the local problem with heroin and prescription opiates. Quite the opposite. The information gathered in this investigation reveals that a significant demand for heroin exists in Marquette County. DEA investigators conservatively estimate, based on information uncovered in the investigation, that Abram sold a minimum of several ounces of heroin per month for more than three years in the local area. It is believed that he could have sold a great deal more.
The Center for Disease Control has described prescription painkiller overdoses as a "public health epidemic." In fact, addiction to opioids (heroin and prescription opiate painkillers) is growing, and annual opioid-related deaths now exceed the number of annual traffic fatalities. A nationwide, county by county depiction of annual death rates from drug poisoning from 1999-2014 by county can be found at http://blogs.cdc.gov/nchs-data-visualization/drug-poisoning-mortality/
Nationally, about 9 people per 100,000 die from opioid abuse annually. That equates to about 78 people per day, and about 28,500 per year. And Michigan is one of the states that his hardest hit by the epidemic. For example, in Michigan, the number of babies treated for neonatal abstinence syndrome (NAS) has doubled in recent years. NAS is a group of problems that occur in a newborn who was exposed to addictive illegal or prescription drugs while in the mother’s womb. Hospitals in the Upper Peninsula had the highest rate of NAS in the state by far, with a rate of 21 cases per 1,000 births in 2014.
Ms. Tinney’s case demonstrates how opiate addiction can impact multiple generations. She began using prescription opiates many years ago and was using these substances daily by the age of 21. Now 25, she has given birth to two children and been unable to hold down any form of employment. She will now be spending the next 3-4 years in prison while someone else raises her children.
Tinney, in contrast to most addicts, however, has a unique opportunity. During her sentencing hearing, Judge Edgar recommended that she participate in the Federal Bureau of Prison’s Residential Drug Abuse Program (RDAP), which is a 9-month program offered to federal inmate with significant drug issues. These inmates reside in a separate unit from general population and devote their full day to programming, work, school and vocational activities. RDAP has been shown to be very successful in preventing recidivism and relapse and is frequently requested by drug-addicted federal convicts.
Through criminal prosecutions, law enforcement works to deter drug trafficking and spread awareness of the dangers posed by illicit drug use. But the U.S. Attorney’s Office’s efforts extend beyond prosecutions. The U.S. Attorney’s Office has offered and will continue to offer presentations on the dangers of opioid addiction, the extent of the drug diversion problem and challenges for law enforcement to audiences that include doctors and medical providers, public radio listeners, local television media affiliates, state and local law enforcement officers, the State Attorney General’s Office and even local elected officials.
To spread awareness of the dangers opioids pose, the Department of Justice has sponsored a 45-minute documentary film entitled "Chasing the Dragon," https://www.fbi.gov/news/stories/2016/february/raising-awareness-of-opioid-addiction/raising-awareness-of-opioid-addiction. The film depicts the harsh reality of opioid addiction and the rapid path to abuse, addiction and too frequently death. It contains frank discussions of the impact of opiates and heroin on the lives of users and their families. The language and the outcomes are not pleasant, but the film can serve as an instructive tool for discussions with parents and students. U.S. Attorney Miles has begun reaching out to school districts in West Michigan to begin a dialogue about how to spread awareness among vulnerable youth of the dangers of opioids. Any school district interested in such a conversation, should contact the U.S. Attorneys Office.
END
Guatemalan National Indicted for Illegal Re-EntryRead the Press Release
U.S. Attorney Kenneth A. Polite announced that JULIO RAYMUNDO-SANTOS, age 41, a citizen of Guatemala, was charged today in a one-count Indictment for illegal reentry of a removed alien in violation of Title 8, United States Code, Section 1326(a).
According to the Indictment, RAYMUNDO-SANTOS reentered the United States after he was previously deported on April 4, 2014. If convicted, RAYMUNDO-SANTOS faces a maximum term of imprisonment of two years, a maximum fine of $250,000, a maximum term of supervised release of one year, and a mandatory $100 special assessment.
U. S. Attorney Polite reiterated that an Indictment is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
U.S. Attorney Polite praised the work of the United States Department of Homeland Security in investigating this matter. Assistant U.S. Attorney Spiro G. Latsis is in charge of the prosecution.
Government Reaches $2.5 Million Settlement in Healthcare Fraud MatterRead the Press Release
SAN JUAN, Puerto Rico – On May 18, 2016, the U.S. Government entered into an out of court settlement agreement with Hospicio La Paz, Inc., in connection with a False Claims Act investigation carried out by the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG) and the U.S. Attorney’s Office, District of Puerto Rico. The investigation uncovered approximately $1,504,509.00 in questionable billings submitted for payment by Hospicio La Paz, Inc. to Medicare Program, Part A, from October 2011, through September 2012.
Under the False Claims Act, Title 31, United States Code, Sections 3729, et seq., the United States can recover up to three times the amount of loss and civil monetary penalties ranging from $5,500.00 to $11,000.00 per false claim. As part of the settlement negotiations, Hospicio La Paz, Inc. paid the United States Government the sum of $2,500,000.00, including excess damages and penalties. Furthermore, Hospicio La Paz will enter into a compliance agreement with HHS-OIG.
The United States Attorney’s Office will continue to investigate healthcare fraud matters, and will aggressively pursue civil and criminal actions against those who attempt to defraud the United States. The matter was prosecuted by Assistant U.S. Attorney Rafael J. López Rivera, Civil Health Care Fraud Coordinator, at the U.S. Attorney’s Office.
Former Talbot County Attorney Sentenced to Prison for Real Estate Investment Fraud Scheme with over $768,000 in LossesRead the Press Release
Baltimore, Maryland – U.S. District Judge J. Frederick Motz sentenced Aaron G. Seltzer, age 39, of Trappe, Maryland, today to five years in prison, followed by three years of supervised release, for wire fraud in connection with a scheme in which he converted funds intended for real estate investments to his personal use.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Andre R. Watson of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); and Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation, Baltimore Field Office.
According to his plea agreement and court documents, Seltzer was a licensed Maryland attorney who handled real estate transactions and maintained an office in Crofton, Maryland. From January 2008, through 2010, Seltzer offered victims fraudulent investment opportunities then diverted the money intended for the investments for his own benefit. Seltzer obtained a total of $768,242 through seven fraudulent transactions. As part of his plea agreement, Seltzer is required to pay restitution in that amount.
For example, Seltzer offered to sell an investor 45% of an Anne Arundel County real estate company, claiming that he owned 100% of the stock, assets and liabilities of the company, when in fact, he did not. The investor sent a total of $92,000 to Seltzer, which Seltzer used for his own benefit. During the summer of 2009, Seltzer contacted a lawyer in New York and represented that a client of Seltzer’s was seeking a business loan. Seltzer proposed that the loan be secured by a mortgage on three commercial properties located in Virginia, purportedly owned by Seltzer’s client. The New York attorney assembled a group of investors to fund the loan. Seltzer presented the attorney with a fraudulent promissory note, which Seltzer falsely claimed was signed by a representative of his client. Seltzer further falsely represented that he had conducted the closing for the loan and presented the attorney with fabricated closing documents. On behalf of the investors, the attorney wired Seltzer $497,527 to fund the loan, which Seltzer diverted to his own benefit.
Seltzer was investigated by the Maryland Attorney Grievance Commission for his conduct in the scheme and was subsequently disbarred.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s 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. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
United States Attorney Rod J. Rosenstein praised HSI Baltimore, and the FBI and for their work in the investigation and recognized the Maryland Attorney Grievance Commission and Bar Counsel Glenn Grossman for their assistance. Mr. Rosenstein thanked Assistant U.S. Attorney Leo J. Wise, who prosecuted the case.
Former Senior Executive from Universal Forest Products Robert Lees Found Guilty by White Plains Federal Jury for Fraudulent Kickback SchemeRead the Press Release
Preet Bharara, United States Attorney for the Southern District of New York, announced today that ROBERT LEES, a former senior executive of Universal Forest Products, Inc. (“UFP”) was convicted a jury of conspiracy, mail fraud, money laundering and making false statements in a loan application following a seven-day trial in White Plains before United States District Judge Kenneth M. Karas.
Manhattan U.S. Attorney Preet Bharara said: “Today, a jury unanimously found that Robert Lees, a senior executive at Universal Forest Products, participated in a kickback scheme that defrauded both HUD and a mortgage lender. This verdict should serve as a warning to other corporate executives tempted by fraud.”
The evidence at trial proved that, in or about 2009, Michael Barnett, a real-estate developer, hired JK Scanlan Company, Inc. (“Scanlan”) to be the general contractor on Vineyard Commons, a senior housing community in Ulster County. In or about 2009, Scanlan entered into falsely inflated contracts with Shawnlee Construction, LLC (“Shawnlee”), a subsidiary of UFP for which LEES had responsibility, to be the subcontractor on Vineyard Commons responsible for framing and rough carpentry.
In or about 2009, a private lender (the “Mortgagor”), agreed to provide financing to Vineyard Commons, which financing would be insured by HUD. The Mortgagor and the borrower agreed that the proceeds would be disbursed incrementally after the borrower submitted draw requests based upon its completion of phases of the project.
On or about January 19, 2009, Shawnlee provided Scanlan a final bid to supply labor and materials for Vineyard Commons. In or about March and April 2009, representatives of UFP – including LEES – Shawnlee, and Scanlan entered into an agreement by which UFP and Shawnlee agreed to provide labor and materials in an amount approximately $865,000 greater than the final bid. LEES and others intended for the approximately $865,000 difference between the final bid and the inflated contract price to be returned to Barnett as a kickback, and further intended that the Mortgagor would unwittingly finance the kickback by disbursing HUD-insured funds on the basis of inflated draw requests.
In or about early 2009, Scanlan’s owner agreed to provide Barnett and Vineyard Commons with a million-dollar loan. In order to obtain this loan, Barnett informally pledged the anticipated $865,000 kickback to Scanlan’s owner as collateral.
In or about June 2009, Barnett needed additional funds in order to secure HUD-insured financing from the Mortgagor. UFP provided a $650,000 letter of credit to the Mortgagor. Barnett informally pledged the anticipated approximately $865,000 kickback to UFP as collateral, even though it was already pledged to Scanlan’s owner.
On or about July 2, 2009, Barnett and others provided HUD with a written estimate of the cost of Shawnlee’s work (the “Final Framing Price”) that exceeded Shawnlee and UFP’s actual price for labor and materials by approximately $865,000.
Beginning in or about July 2009, and continuing until in or about January 2012, Barnett and Scanlan submitted contractor’s requisitions (the “Contractor Requisitions”) on forms provided by HUD to the Mortgagor, which the Mortgagor then sent to HUD. These Contractor Requisitions included a certification by a representative of Scanlan that “all the information stated herein, as well as any information provided in the accompaniment herewith, is true and accurate.” Each of these forms set forth the Final Framing Price as the actual cost of rough carpentry. Each month, the Mortgagor disbursed HUD-insured funds on the basis of the Contractor Requisitions. UFP set aside the “extra” from the Shawnlee/Scanlan contract in an accrual account falsely labeled as a rebate accrual.
In or about January 2010, LEES agreed with Barnett to pay Scanlan’s owner $200,000, which payment they understood would be guaranteed by part of Barnett’s interest in the approximately $865,000 difference between the contract price and the actual price for labor and materials provided by Shawnlee and UFP. Barnett sought this payment, and LEES agreed to make this payment, as a partial payment of Barnett’s obligation to Scanlan’s owner. LEES arranged for UFP to send a $200,000 check to a company controlled by Barnett that was not involved in the development of Vineyard Commons – which would then pass the money on to Scanlan’s owner. On or about January 15, 2010, UFP issued a check for $200,000 to Barnett’s company and mailed it from Michigan to Barnett in Dutchess County, New York.
On or about January 20, 2010, Barnett sent to Scanlan’s owner in Massachusetts a $200,000 check that he drew on the account into which Barnett had deposited the check he received from UFP.
Later in 2010, Barnett sought a five-million-dollar loan from UFP. Among other incentives, Barnett offered to surrender the remainder of his kickback to UFP, allowing UFP to take that money into its own profit. With LEES’s encouragement, UFP issued the loan to Barnett.
The developer of Vineyard Commons defaulted on the loan after the project failed. HUD assumed the loan and sold the project, losing $28 million.
LEES, 62, of Lititz, Pennsylvania, is scheduled to be sentenced by Judge Karas on November 4, 2016. LEES faces a maximum sentence of five years in prison on the conspiracy count, 20 years in prison on the mail fraud count, 30 years in prison for making false statements in a loan application, and 10 years in prison on the money laundering count. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes, as any sentencing of the defendant will be determined by the judge.
* * *
Mr. Bharara praised the investigative work of the HUD-OIG.
The prosecution is being handled by the Office's White Plains Division. Assistant U.S. Attorneys Michael D. Maimin and Won S. Shin are in charge of the prosecution.
Former Miami-Dade Police Department Officer Charged in Illegal Bribery and Kickback SchemeRead the Press Release
Former Miami-Dade Police Department Officer Lazaro Ponce was arrested for his participation in a bribery and kickback scheme, in violation of Title 18, United States Code, Sections 371, 666(a)(1)(B), and 666(a)(2).
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Juan J. Perez, Director, Miami-Dade Police Department (MDPD), made the announcement.
On May 20, 2016, Ponce voluntarily surrendered pursuant to an Information filed by the U.S. Attorney’s Office. In that charging document, Ponce is alleged to have accepted bribes over a one-year period during which he was employed as a uniformed MDPD police officer. In exchange for cash payments from tow truck drivers, Ponce would permit those drivers to circumvent the Miami Dade rotational towing list and illegally solicit business from stranded motorists at MDPD accident scenes. Ponce is also alleged to have provided accident locations to tow truck drivers in exchange for payments and, on at least one occasion, gave his encrypted MDPD radio to some of his non-police coconspirators to help further the scheme.
After his initial appearance before U.S. Magistrate Judge John O’Sullivan, Ponce was released on a $200,000 personal surety bond. The case is presently assigned to United States District Judge Joan Lenard, Case No. 16-CR-20361-Lenard. If Ponce is convicted, he faces a maximum sentence of five years’ imprisonment, a maximum fine of $250,000 and a maximum term of three years’ supervised release.
Mr. Ferrer commended the investigative efforts of the FBI Miami Area Corruption Task Force and the MDPD Internal Affairs Division. This case is being prosecuted by Assistant U.S. Attorney Anthony Lacosta.
An information is merely an allegation and every defendant is presumed innocent until proven guilty.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Former Erie Resident Admits He Failed to Register as a Sex OffenderRead the Press Release
ERIE, Pa. - A former resident of Erie, Pennsylvania, pleaded guilty in federal court to a charge of failure to register under SORNA, United States Attorney David J. Hickton announced today.
Warren Gannoe, 57, pleaded guilty to one count before United States District Judge David S. Cercone.
In connection with the guilty plea, the court was advised that Gannoe knowingly failed to update his registration as required by the Sex Offender Registration and Notification Act.
Judge Cercone will schedule the sentencing at a later date. 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 offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Christian A. Trabold is prosecuting this case on behalf of the government.
The United States Marshal’s Service conducted the investigation that led to the prosecution of Gannoe.
Former Employee at a Lubbock Counseling Center is Sentenced on Health Care Fraud ConvictionRead the Press Release
LUBBOCK, Texas — A 36-year-old woman from Lubbock, Texas, Paula McNeal, who pleaded guilty in January 2016 to one count of health care fraud, was sentenced today by Senior U.S. District Judge Sam R. Cummings to 18 months in federal prison and ordered to pay $104,088 in restitution, announced U.S. Attorney John Parker of the Northern District of Texas.
McNeal, aka Paula Quigley and Paula Walker, was ordered to surrender to the Bureau of Prisons on June 24, 2016.
According to documents filed in the case, McNeal worked at New Hope Christian Counseling (NHCC) in Lubbock, and her duties included billing, submitting bills to Medicaid for services provided, receiving and opening mail, posting income, adjustments and receipts to counselors’ accounts, and making bank deposits.
From approximately December 7, 2010, to August 8, 2013, McNeal falsely and fraudulently billed Medicaid for services that were not provided, using the group billing number for NHCC and the individual provider identifier for one of the counselors. As a result, Medicaid mailed approximately $104,088.45 in checks to NHCC to which NHCC was not entitled and which McNeal appropriated for her own personal use.
McNeal submitted bills for extra claims to Medicaid for NHCC existing clients and their siblings. These clients and their siblings received no services from NHCC. McNeal also billed for unserved children whose Medicaid numbers were available to her. She misappropriated more than 100 checks and deposited them into one of three personal bank accounts.
The case was investigated by the Texas Attorney General’s Medicaid Fraud Control Unit.
Assistant U.S. Attorney Paulina Jacobo was in charge of the prosecution.
# # #
Former Carmel investor sentenced in fraud schemeRead the Press Release
Over $300,000 swindled from unsuspecting investors
PRESS RELEASE
Indianapolis – United States Attorney Josh Minkler announced today that a former Carmel investor was sentenced in federal court to 57 months (nearly five years) imprisonment on 15 counts of wire fraud, one count of securities fraud and one count of money laundering. Jaime C. Lopez, 41, currently residing in Wabash Indiana, was sentenced by U. S. District Judge Tanya Walton Pratt. He was convicted in a four-day jury trial in January 2016.
“Stealing from retirement accounts to fund a lavish lifestyle is immoral as well as illegal,” said Minkler. “Mr. Lopez betrayed the trust of family and close friends by his deceitful actions. He will have nearly five years to think about his crimes in federal prison.”
Lopez was a financial advisor who conducted business from his home in Carmel. He created various business names, JCL Interest Plus, JCL Capital Inc. and JCL Directs (JCL Entities) to direct funds from the unsuspecting investors. From January 2010-until June 2012, Lopez convinced investors to transfer their Individual Retirement Accounts to self-directed accounts. Lopez would then transfer the money into JCL Entities under his control.
Lopez solicited hundreds of thousands of dollars telling investors he had reinvested the money by loaning it to outside businesses, purchasing corporate bonds and notes or investing in real estate. Additional funds were used by Lopez to pay interest on promissory notes issued to the investors. Later the investors were issued new promissory notes for a longer term of investment and at a much lower rate of interest. Lopez never invested the money as promised, rather spending the money on the purchase of automobiles, home mortgage payments and home landscaping.
This case was investigated by the Internal Revenue Service-Criminal Investigation and the Indiana Secretary of State, Securities Division.
Special Agent in Charge Stephen Boyd stated, “Today’s sentence sends a clear message that the business practices of Mr. Lopez will not be tolerated and that he will be held accountable. IRS Criminal Investigation and our law enforcement partners will continue to aggressively pursue the illegal business practices of Mr. Lopez and others who defraud and steal from honest, hardworking Americans.”
According to Assistant United States Attorney James M. Warden, who prosecuted this case for the government with Assistant United States Attorney Winfield Ong, Lopez will serve three years of supervised release after his sentence and must make restitution of approximately $300,000 to his victims. He was remanded immediately to the custody of the U.S. Marshal’s Service to begin his sentence.
Former Army Explosives Expert Charged with Unlawful Possession of GrenadesRead the Press Release
KANSAS CITY, KAN. – A former Army explosive ordinance disposal technician was charged in federal court Friday with unlawful possession of grenades, Acting U.S. Attorney Tom Beall said.
John A. Panchalk, 42, Overland Park, Kan., was charged with one count of possessing two M-67 fragmentation grenades that were not registered to him in the National Firearms Registration and Transfer Record.
According to an agent’s affidavit, the investigation began May 19 when police were called to the Parkville Self Storage Facility in Parkville, Mo. They found several trailers and vehicles had been vandalized. In and around one trailer, they found ammunition canisters, rocket fins, blasting caps, C-4 explosive and military grenade simulators. They determined Panchalk was the owner of the trailer.
When investigators contacted Panchalk at home in Overland Park, he was evasive when they asked him about the contents of the trailer. When they executed a search warrant at Panchalk’s home, they found 38 pounds of C-4 explosive, detonation cord, blasting caps, grenade simulators, incendiary devices and the two M-67 fragmentation grenades.
If convicted, he faces a maximum penalty of 10 years and a fine up to $250,000. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated with assistance from the FBI, the Parkville, Mo., Police Department and the Overland Park Police Department. Assistant U.S. Attorney Terra Morehead is prosecuting.
Ferndale Man Arrested for Attempted Enticement of a MinorRead the Press Release
A 39- year-old Ferndale, Washington resident was arrested as he approached the U.S./Canadian border this morning as he sought to travel to British Columbia to have sexual contact with a person he believed to be a 12-year-old girl, announced U.S. Attorney Annette L. Hayes. CHRISTOPHER DAVID JOHNSTON was arrested as he attempted to illegally enter Canada. He made his initial appearance in U.S. District Court in Seattle today where he is charged by complaint with Attempted Enticement of a Minor. He will remain in custody pending a detention hearing next week.
According to the criminal complaint, in early May 2016, JOHNSTON began communicating with a person who responded to a personal ad he had placed on Craigslist. The ad said JOHNSTON was seeking a “young lady to spoil.” An undercover agent responded to the ad, indicating that she was not yet 13 years old. Despite knowing that young age, JOHNSTON engaged in increasingly sexualized emails, texts and chats with the agent, ultimately arranging to meet the ‘child’ in Abbotsford, BC for sex. He was arrested in the U.S. as he rode his bicycle as he approached the border near Sumas, Washington. Via text message he told the ‘girl’ that he was planning on crossing the border illegally to meet her in Canada.
Attempted enticement of a minor is punishable by a mandatory minimum ten years to life in prison.
The charges contained in the complaint are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
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.justice.gov/psc .
The case is being investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI). The case is being prosecuted by Assistant United States Attorney Matthew Hampton.
Federal Indictment Charges Five Luna County Residents with Methamphetamine Trafficking and Money Laundering ChargesRead the Press Release
ALBUQUERQUE – Five residents of Luna County, N.M., are facing federal narcotics trafficking and money laundering charges as the result of a multi-agency investigation led by Homeland Security Investigations (HSI) into methamphetamine trafficking in and around Deming, N.M. The charges were announced by U.S. Attorney Damon P. Martinez, Special Agent in Charge Waldemar Rodriguez of HSI in El Paso, Luna County Sheriff Jonathan Mooradian, Grant County Sheriff Raul Villanueva, Chief Ed Reynolds of the Silver City Police Department and Chief Brandon Gigante of the Deming Police Department.
The charges against the five defendants are the result of a multi-agency investigation led by HSI into a Deming-based methamphetamine trafficking organization allegedly led by Domingo Rodriguez. The investigation was designated as part of the Organized Crime Drug Enforcement Task Force (OCDETF) program, a Department of Justice program combines the resources and unique expertise of federal agencies, along with their local counterparts, in a coordinated effort to disrupt and dismantle major drug trafficking organizations. It included a series of methamphetamine purchases by individuals working under the supervision of law enforcement officers. During the course of the investigation, law enforcement authorities seized and purchased more than two pounds methamphetamine. They also seized more than another pound of methamphetamine during a law enforcement operation yesterday.
The five defendants, Rodriguez, 45, Leslie Frank Williams, 51, Oscar Garcia, 45, and Andy Garcia, 43, all residents of Deming, and Estella Aguilar, 44, of Tucson, Ariz., are charged in a nine-count indictment alleging methamphetamine trafficking and money laundering offenses. Count 1 of the indictment charges all five defendants with participating in a methamphetamine trafficking conspiracy in Luna County between July 2015 and April 2016. Counts 2 through 5 charge Williams with distributing quantities of methamphetamine on four dates between July 2015 and Sept. 2015. Count 6 charges Williams and Rodriguez with distributing methamphetamine in Nov. 2015 and Count 7 charges Williams, Rodriguez and Garcia with distributing methamphetamine in Jan. 2016. Count 8 charges Rodriguez, Oscar Garcia and Aguilar with participating in a money laundering conspiracy and Count 9 charges Rodriguez and Aguilar with a money laundering offense. The indictment includes forfeiture provisions seeking a money judgment of $1,000,000, the sum allegedly derived from the drug trafficking crimes alleged in the indictment.
Williams and Rodriguez were arrested yesterday, and made their initial appearances in federal court in Las Cruces, N.M., this morning. Oscar Garcia is in state custody in Oklahoma and Andy Garcia is in state custody in New Mexico on unrelated charges. Both will be transferred to federal custody to face the charges in the indictment. Aguilar has yet to be arrested and is considered a fugitive.
If convicted on the methamphetamine charges, each of the five defendants faces a statutory mandatory minimum of ten years and a maximum of life in prison. If convicted on the money laundering charges, Rodriguez, Oscar Garcia and Aguilar each face a statutory maximum penalty of 20 years in prison. Charges in indictments and complaints are merely accusations and defendants are presumed innocent unless convicted in a court of law.
This case was investigated by HSI in Deming and Las Cruces, the U.S. Border Patrol in Las Cruces and Deming, Luna County Sheriff’s Office, Grant County Sheriff’s Office, Deming Police Department, Silver City Police Department, New Mexico HIDTA Intelligence Center, the El Paso Intelligence Center, Department of Homeland Security ICE Enforcement Removal Operations and Office of Intelligence and Analysis. Assistant U.S. Attorneys Mark A. Saltman and Dustin Segovia of the U.S. Attorney’s Las Cruces Branch Office are prosecuting the case.
Enfield Restaurant Owner to Serve Time in Federal Prison for Tax EvasionRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that GEORGE CARABASE, 41, of Enfield, was sentenced today by U.S. District Judge Jeffrey A. Meyer in New Haven to 12 months and one day of imprisonment, followed by one year of supervised release, for tax evasion.
According to court documents and statements made in court, in 2010 and 2011 CARABASE failed to report to the Internal Revenue Service approximately $550,000 in gross receipts generated by Buona Vita Restaurant, a restaurant he operates in Enfield.
During the investigation of this matter, CARABASE admitted to an undercover IRS agent that he understated the restaurant’s gross receipts on his income tax returns and provided false numbers to his accountant.
On February 22, 2016, CARABASE pleaded guilty to two counts of tax evasion, admitting that he evaded payment of a total of $183,282 in income taxes when filing his income tax returns for 2010 and 2011.
To date, CARABASE has paid $60,000 in back taxes. Judge Meyer ordered him to pay an additional $149,926 in back taxes and interest.
This case was investigated by the Internal Revenue Service – Criminal Investigation Division and was prosecuted by Assistant U.S. Attorney Heather Cherry.
Edmond Man Charged with Inducing a Child to Produce Child Pornography—Then Using it to Engage in SextortionRead the Press Release
Oklahoma City, Oklahoma – Carlos Alexander Davila, 23, of Edmond, was charged yesterday with production and possession of child pornography, announced Mark A. Yancey, Acting United States Attorney for the Western District of Oklahoma.
According to an affidavit in support of a criminal complaint, Davila contacted a 14-year-old Florida girl in March of 2016 through Facebook, after seeing her post a comment that her friend had committed suicide. They began communicating via Facebook and later by texting and the smartphone application, Kik. It is alleged that Davila told the girl that he was studying to become a psychologist, and he would help her deal with her friend’s suicide. Eventually, the defendant asked the girl for nude photos in exchange for his emotional support. The girl told Davila that she was only 14, but he said it did not matter. The girl eventually sent Davila nude images of herself.
According to court records, the girl reported that Davila became very possessive of her, and when she tried to end their online relationship, he threatened to post online the nude images she had sent him. According to text messages described in court records, the girl begged Davila to delete her images, but he said he would "keep every single pic and video" and would "leak everything" about her "to everyone," especially his "hungry friends in need of fresh meat." Davila allegedly texted her, saying, "The more you ignore me the more I’ll expose you without a care in the world." He allegedly texted her that if she did not respond to him in five minutes, he would post a picture she had sent him—alongside a request that listed her contact information and asked for pictures of men’s penises. Davila allegedly used a phone-number-spoofing app to send the girl text messages to give her the impression that her images had in fact been posted online and that people were contacting her.
According to court records, when Edmond Police Department officers examined Davila’s electronic devices, they found child pornography depicting the Florida girl, as well as other images of child pornography.
If convicted of producing child pornography, Davila faces a minimum of fifteen and a maximum of thirty years in prison, as well as supervised release of five years to life.
This case is being investigated by the Hillsborough County (Florida) Sheriff’s Department and the Edmond Police Department. The case is being prosecuted by Assistant U.S. Attorney Brandon Hale.
Please note that an indictment is only a charge and is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
District Man Sentenced to Seven Years in Prison for Assaulting His Step-DaughterRead the Press Release
WASHINGTON – A 43-year-old man, formerly of Washington, D.C., was sentenced today to seven years in prison on a charge of assault with intent to commit first-degree sexual abuse of his 13-year-old stepdaughter, U.S. Attorney Channing D. Phillips announced.
The man, who is not identified here to protect the privacy of the victim, pled guilty in March 2016, in the Superior Court of the District of Columbia. The plea, which was contingent upon the Court’s approval, called for a seven-year prison sentence. The Honorable Michael Ryan accepted the plea today and sentenced the man accordingly. Following completion of his prison term, the man will be placed on three years of supervised release. He also will be required to register as a sex offender for the rest of his life.
According to the government’s evidence, sometime between May and October of 2015, the victim and her younger sibling would spend weekends at the defendant’s home in Northwest Washington. On one occasion during that time-frame, the defendant told the victim to remove all of her clothes. At that time, he had a belt in his hand and threatened to beat the girl if she did not comply. Out of fear, she complied, whereupon the man sexually assaulted her. The man was arrested on Feb. 6, 2016, after the abuse came to light, and has been in custody ever since.
In announcing the sentence, U.S. Attorney Phillips praised the work of detectives from the Metropolitan Police Department’s Youth Investigations Division, which investigated the case; and of personnel from Safe Shores, who forensically interviewed the victim and her younger sibling. He acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialist D’Yvonne Key; Child Forensic Interview Specialist Karen Giannakoulias, and Victim/Witness Advocate Tracey Hawkins. Finally, he commended Assistant U.S. Attorneys Jessica Brooks and Peter V. Taylor, who investigated and prosecuted this case.
Convicted Felon Sentenced for Possessing AmmunitionRead the Press Release
SYRACUSE, NEW YORK – Kawon D. Chavis, 33, of Syracuse, New York was sentenced today to serve thirty (30) months imprisonment followed by three (3) years of supervised release for his possession of ammunition as a convicted felon, announced United States Attorney Richard S. Hartunian.
Chavis was arrested by Syracuse Police on August 22, 2015, for possession of a small amount of heroin. Also located in his clothing were five live rounds of .38 caliber ammunition. Federal and state prosecutors reviewed the case as part of ongoing cooperative efforts to combat firearms violence and determined that the defendant should be prosecuted in United State District Court. Chavis, who had previously been convicted of two prior felony level firearms possession offenses, was arrested and charged federally on September 8, 2015.
This case was investigated by The United States Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF) and the Syracuse Police Department (SPD) and is being prosecuted by Assistant U.S. Attorney Richard Southwick with assistance provided by the Onondaga County District Attorney’s Office.
Computer Hacker Extradited from FranceRead the Press Release
ATLANTA - Eric Donys Simeu, a/k/a Martell Collins, a citizen of Cameroon, has been arraigned on federal charges of conspiracy, wire fraud, computer fraud and access device fraud. Simeu was indicted by a federal grand jury in Atlanta on September 23, 2014.
“Cybercrime is borderless, but increasingly, so too are our law enforcement capabilities,” said U.S. Attorney John Horn. “With the cooperation of France and our international law enforcement partners, we were able to bring to justice a wanted fugitive who was allegedly committing cyber fraud that affected U.S. companies from the streets of West Africa.”
“Those who target US companies and citizens through cyber attacks and spear phishing emails can no longer be confident they will remain anonymous and be protected by geographic boundaries. The arrest and extradition of Eric Simeu is the result of a multi-national effort led by the FBI, which demonstrates the benefits of global cooperation among international law enforcement and the private sector. This arrest and extradition serves a strong deterrent to those targeting the computer networks of US companies and US citizens. It should also serve as a reminder to the public to be vigilant and aware they are frequently targeted through fraudulent emails seeking to steal their personal information,” said J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office.
According to U.S. Attorney Horn, the charges, and other information presented in court: Eric Simeu is allegedly responsible for a series of “phishing campaigns” which targeted customers of Global Distribution System (“GDS”) companies from approximately July 2011 to September 2014.
A “phishing campaign” is the act of sending targeted emails to individuals for the purpose of acquiring usernames and passwords. The emails masquerade as an official communication from a legitimate company to gain the trust of the recipient and deceive them into providing protected information. GDS companies provide travel booking services to travel agencies and travel-related websites. Airline tickets that are issued from sources other than air carriers themselves are generally processed through a GDS company. Customers of GDS companies, such as representatives from a travel agency or travel-related website, are issued unique login credentials that are utilized to authenticate their identity and facilitate the issuance of airline tickets on GDS servers.
In this instance, Simeu’s alleged phishing campaigns targeted customers of two GDS Companies – one with its principal U.S. operations in Atlanta, Georgia, and another headquartered in Southlake, Texas. Simeu allegedly caused phishing emails to be delivered to customers of these GDS companies for the purpose of obtaining and stealing their unique log-in credentials. Simeu and others allegedly used the stolen log-in credentials to access the servers of the two GDS companies and cause the issuance of fraudulent airline tickets. Simeu and others then allegedly sold these airline tickets to customers, mostly in West Africa, for fractions of the actual cost, or used them for personal travel. The value of the fraudulently issued airline tickets exceeded $2 million.
On September 3, 2014, Simeu was arrested by French law enforcement pursuant to a federal criminal complaint issued out of the Northern District of Georgia. At the time of his arrest, Simeu was traveling from Casablanca, Morocco, to Paris, France, on an alleged fraudulently issued airline ticket in the name of his alias, Martell Collins, utilizing a fraudulent United Kingdom passport under the same name.
Eric Donys Simeu, a/k/a Martell Collins, 32, a citizen of Cameroon, was arraigned before United States Magistrate Judge Russell G. Vineyard. A federal grand jury in the Northern District of Georgia returned an indictment against Simeu on September 23, 2014. Simeu has been in French custody since his arrest in September 2014, pending completion of extradition proceedings.
Members of the public are reminded that the indictment only contains charges. The defendant is presumed innocent of the charges and it will be the government’s burden to prove the defendant’s guilt beyond a reasonable doubt at trial.
This case is being investigated by the Federal Bureau of Investigation and State Department Diplomatic Security Service.
Assistant United States Attorney Steven D Grimberg and Trial Attorney Peter Roman with the U.S. Department of Justice Computer Crime and Intellectual Property Section are prosecuting the case. The Justice Department’s Office of International Affairs also provided valuable assistance.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Cedar Rapids Felon Sentenced to 87 Months’ Imprisonment for Possessing a Firearm and AmmunitionRead the Press Release
A felon was sentenced yesterday to more than seven years in federal prison for possessing a loaded firearm on the streets of Cedar Rapids last fall.
Gregory Ray Nevels, 38, from Cedar Rapids, Iowa, received the prison term after a January 4, 2016 guilty plea to being a felon in possession of a firearm and ammunition. In a plea agreement and at his sentencing, Nevels admitted he was involved in a disturbance in Cedar Rapids, Iowa, on October 24, 2014, that resulted in a 911 call to the police department. Nevels ultimately discarded a loaded firearm near a shed behind a residence on Mount Vernon Road (in Cedar Rapids). Law enforcement officers later recovered the firearm and determined the firearm was stolen.
Nevels was sentenced in Cedar Rapids by United States District Court Chief Judge Linda R. Reade. Nevels was sentenced to 87 months’ imprisonment. A special assessment of $100 was imposed. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system.
Nevels is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Tim Vavricek and investigated by the FBI’s Safe Streets Task Force and the Cedar Rapids Police Department. Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 15-CR-0004-LRR.
Follow us on Twitter @USAO_NDIA.
Broward County Resident Sentenced for Illegally Possessing a Firearm and AmmunitionRead the Press Release
A Broward County resident was sentenced today to 72 months’ imprisonment after being convicted at trial of being a felon in possession of a firearm and ammunition.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, Carlos A. Canino, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Miami Field Division and Scott Israel, Sheriff, Broward Sheriff’s Office (BSO), made the announcement.
Derek Danard Slade, 25, of Hollywood, was sentenced to 72 months in prison, to be followed by 3 years of supervised release, by U.S. District Judge William P. Dimitrouleaus, after a jury convicted the defendant of illegally possessing a firearm and ammunition, in violation of Title 18, United States Code, Section 922(g)(1).
According to evidence presented at trial and during the sentencing hearing, a deputy with the Broward County Sheriff’s Office observed a “hand-to-hand” narcotics transaction take place in a vehicle in the area of Dania Beach. In addition to Slade, the vehicle had three other occupants. After being stopped by law enforcement, Slade refused to show his hands to the deputies and kept them hidden under a hat. The other occupants of the vehicle complied with law enforcement’s directives. Once he finally complied with the deputy’s orders, Slade was handcuffed. After he was handcuffed, Slade broke away from the deputies and fled the scene on foot. Slade was eventually apprehended and deputies located, under the hat in the vehicle, a .380 caliber Beretta firearm, fully loaded with fourteen rounds of .380 caliber ammunition. Slade had a prior felony conviction and had only been out six months when he was arrested on the Federal case.
This case is, in large part, the result of the Violence Reduction Partnership, launched by the U.S. Attorney’s Office. Through this Partnership, the U.S. Attorney’s Office and its federal and local law enforcement allies have sought to dismantle the most violent criminal networks in various neighborhoods, while simultaneously working with community leaders and concerned citizens to mentor at-risk youths, provide jobs and job training to young families, and help probationers and parolees successfully re-enter society.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Baltimore City Police Officer Sentenced to Federal Prison for TheftRead the Press Release
Baltimore, Maryland – U.S. District Judge J. Frederick Motz sentenced Baltimore City Police officer Maurice Lamar Jeffers, age 47, of Savage, Maryland, today to a year and a day in prison, followed by three years of supervised release, for theft of government property and stealing property as a federal officer. Judge Motz also ordered Jeffers to forfeit $3,000.
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, Baltimore Field Office; Commissioner Kevin Davis of the Baltimore Police Department; and Maryland U.S. Marshal Johnny Hughes.
“The agents carried out an undercover operation and obtained a video recording of the defendant stealing cash while he believed he was executing a search warrant,” said U.S. Attorney Rod J. Rosenstein. “I want to thank the officers of the Baltimore Police Department and other agencies that assisted in this investigation.”
Jeffers has been a sworn member of the Baltimore Police Department for the last 12 years, and was assigned as a Task Force Officer (TFO) to the U.S. Marshals’ Capital Area Regional Fugitive Task Force (CARFTF). As a TFO, Jeffers received special deputation to execute arrest and search warrants supporting the federal task force. Jeffers was responsible for locating and arresting offenders who had active local and federal arrest warrants and assisting in locating individuals for other jurisdictions and agencies upon request.
According to court documents and information provided to the court at his plea hearing, acting on information provided by a confidential source, law enforcement conducted a covert operation in which Jeffers was recorded stealing approximately $3,000 in cash. The cash belonged to the FBI.
Jeffers was told to secure a location with another investigator so that a local law enforcement agency could later execute a search warrant. Jeffers entered the location and conducted a brief protective sweep with the other investigator. Jeffers then told the other investigator to go tell other CARFTF members that no one was located inside the location. After the other investigator left the room, Jeffers conducted an illegal search and located the cash hidden by law enforcement, which he placed into his pants pockets. Jeffers kept the money for his own personal gain. On May 7, 2015, Jeffers was arrested and searched incident to the arrest. Law enforcement located $220 (eleven $20 bills) on Jeffers that he stole on March 10, 2015.
United States Attorney Rod J. Rosenstein praised the Baltimore FBI Public Corruption Task Force, which includes Agents and law enforcement officers from the FBI, IRS, the Baltimore Police Department, the Prince George’s County Police Department and the U.S. Marshals’ Capital Area Regional Fugitive Task Force, for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorney Rachel M. Yasser, who prosecuted the case.
Arizona Executive Sentenced for $500,000 Investment SchemeRead the Press Release
BOSTON – An Arizona man was sentenced today in U.S. District Court in Boston in connection with defrauding four people who invested in his foreign currency trading company.
David Prescott, 45, formerly of Boston, was sentenced by U.S. District Judge Allison D. Burroughs to 18 months in prison, three years of supervised release and restitution of $505,619. In November 2016, Prescott pleaded guilty to four counts of wire fraud. Prescott, who previously went by the name of David Weeks, was indicted on those charges in February 2015.
Prescott was the owner and President of Cambridge Currency Partners, LLC (CCP), which was purportedly engaged in the business of buying and selling foreign currency. Prescott falsely represented to investors that their funds would be invested in CCP and used for business purposes, and that the investors would receive a monthly return. In fact, Prescott used the majority of the $500,000 he obtained from four individual investors, one of whom was located in Massachusetts, on his own personal expenses.
As part of the scheme, Prescott solicited investors by promising monthly returns, and made payments to them that purported to be interest, but, in fact, simply consisted of money from other investors. Prescott promised investors guaranteed monthly returns in amounts ranging from three to nine percent with little to no risk to the underlying principal. Prescott made false representations to the investors regarding the balances in their accounts. As a result, Prescott was able to secure multiple investments from the same investors. On one occasion, Prescott allegedly emailed an investor and promised to increase the interest paid on her previous investments if she were willing to invest additional funds, even though Prescott had already spent the majority of her previous investments on personal expenses and repayments to other investors.
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 was prosecuted by Assistant U.S. Attorney Mark J. Balthazard of Ortiz’s Economic Crimes Unit.
Thursday 19 May 2016
“U Can Stop Traffick” Campaign Against Sex and Drug TraffickingRead the Press Release
In November of 2015, the United States Attorney’s Office developed a public service announcement to raise awareness about sex and drug trafficking activities in the state. This public service announcement “U Can Stop Traffick” has recently been named a winner of a People’s Telly Award.
The Telly Award is the premier award honoring outstanding local, regional, and cable TV commercials and programs. This year, there were over 13,000 entries from all 50 states and numerous countries. The “U Can Stop Traffick” public service announcement, which has been airing on Vermont television stations and can be viewed on the campaign’s website, www.UCanStopTraffick.org, won the highest award, an honor bestowed on less than 10% of the entries. The Telly Award is given by a prestigious judging panel of over 500 accomplished industry professionals, each a past winner of a Silver Telly and a member of The Silver Telly Council, who seek to recognize distinction in creative work. In addition to recognition from the Silver Telly Council, the Internet community helps decide the People’s Telly Awards winners.
The “U Can Stop Traffick” public service announcement illustrates the intersection of drug trafficking and sex trafficking in Vermont. It brings to life how drug dealers are assisted by local individuals, some of whom are coerced by those same drug dealers into the commercial sex trade. The website also includes the powerful stories of women who have been trafficked, recorded in their own words and voices, along with resource lists for individuals in need of help.
The public service announcement was directed by Christian Clark and produced by Christian Clark, Tim Joy, and Justin Bunnell. Tim Joy did the cinematography. When asked to describe his experience in filming the PSA, Christian Clark stated: “It was a very humbling couple of weeks. The biggest challenge in tackling an issue of this magnitude is choosing what to say in thirty seconds. The PSA we crafted is a conversation starter. My hope is that the PSA will motivate people to want to learn more and get involved.” Clark added: “I have the deepest respect for the women who have the courage to share their stories to help spread the word. Furthermore, I want to commend all the great people at the US Attorney’s Office who are working tirelessly day in and day out to put a stop to human trafficking in Vermont.”
U.S. Attorney Miller congratulated the production team for its excellent work in developing the award-winning PSA. “In raising community awareness, the public service announcement is an important step in undermining the foundations of drug dealing in our state and connecting victims with the help and resources they need,” said U.S. Attorney Miller.
A special two-part series on the human trafficking issues raised in the PSA will air tonight and tomorrow at 6:00 pm on WCAX.
William T. “Billy” Walters Charged in Manhattan Federal Court with Insider TradingRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Diego Rodriguez, the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), and Philip R. Bartlett, Inspector-in-Charge of the New York Office of the U.S. Postal Inspection Service (“USPIS”), announced the arrest of WILLIAM T. WALTERS, a/k/a “Billy,” on charges of participating in a scheme, from in or about 2008 through in or about 2014, to commit insider trading principally relating to securities of Dean Foods Company (“Dean Foods” or the “Company”). In addition, Mr. Bharara announced the unsealing of charges against THOMAS C. DAVIS, who pled guilty and admitted to his participation in the scheme earlier this week. On a number of occasions beginning in 2008, DAVIS, who routinely possessed material, nonpublic information through his service on the Dean Foods’ Board of Directors, betrayed his duty of confidentiality to the Company by providing this information to WALTERS before it was publicly announced. As alleged in the charging documents, WALTERS, in turn, used the confidential information to execute profitable trades in Dean Foods that netted him realized and unrealized gains and avoided losses of more than $40 million. In exchange, WALTERS provided DAVIS with substantial pecuniary benefits, including, among other things, capital for joint business ventures and two loans of nearly $1 million that DAVIS largely did not repay.
WALTERS, who is charged with conspiracy, securities fraud, and wire fraud, was arrested yesterday in Las Vegas, Nevada, and will be presented later today before a United States Magistrate Judge in the District of Nevada. His case is before United States District Judge P. Kevin Castel in the Southern District of New York. On Monday, DAVIS pled guilty before Judge Castel to conspiracy, securities fraud, wire fraud, obstruction of justice, and perjury.
In a separate action, the Securities and Exchange Commission (“SEC”) filed civil charges against WALTERS and DAVIS.
U.S. Attorney Preet Bharara said: “Tom Davis has admitted that, over five years as a Dean Foods board member, he repeatedly and systematically fed material nonpublic information about the company to Billy Walters, who we allege benefited handsomely by trading on that information. With a direct channel into Dean Foods’ boardroom, Walters allegedly traded in advance of good news and bad news alike. As alleged, it was all good news for Walters, because he had the information before everyone else – he had tomorrow’s headlines today. Brazen insider trading continues to be a blot on our securities markets, and so the integrity of our markets continues to be a priority for this office. When the board member of a Fortune 500 company feeds inside information to a professional gambler who makes a fortune on well-timed trades in that company’s stock, that is a form of corruption – the corruption of our markets. And we don’t let corruption stand. We intend to prove every one of these allegations in a court of law.”
FBI Assistant Director-in-Charge Diego Rodriguez said: “Trading on inside information for personal gain causes untold devastation in the stock and commodities markets. This kind of criminal behavior keeps wealth concentrated among the powerful, prevents everyday investors from turning a profit, and undermines public confidence in the integrity of the marketplace. The FBI and our federal partners will continue to work to protect Americans from the devastating consequences of these deceptive practices.”
USPIS Inspector-in-Charge Philip R. Bartlett said: “These individuals were more concerned with their ‘high-roller’ image and the continuation of their lavish lifestyles than they were with adhering to fair and equitable investment regulations. This arrest should send a message to all that no matter how much money you accrue, no one is above the law and all will be prosecuted equally for their illegal investment practices.”
According to the allegations in the charging documents unsealed today in Manhattan federal court, including the Indictment,[1] and statements made in court proceedings:
From in or about 2008 through in or about 2014, WALTERS and DAVIS, among others, participated in a scheme to commit insider trading principally related to securities of Dean Foods, a Fortune 500 company that is the largest processor and distributor of fresh milk in the United States. From in or about 2001 until on or about August 7, 2015, DAVIS served as a member of the Board of Directors of Dean Foods (the “Board”), in which role he regularly possessed material, nonpublic information about Dean Foods, including about the Company’s financial performance and results, including quarterly earnings results; contemplated and actual corporate transactions; and other significant corporate and strategic developments (the “Inside Information”). In furtherance of the scheme, DAVIS violated his duties of trust and confidence to Dean Foods by providing Inside Information to WALTERS in advance of public announcements. WALTERS, knowing that DAVIS owed duties of trust and confidence to the Company, used the Inside Information to execute profitable trades in Dean Foods stock. In total, WALTERS’s trading on the basis of Inside Information netted realized and unrealized profits of approximately $32 million and avoided additional losses of approximately $11 million. In return for DAVIS providing the Inside Information to WALTERS, WALTERS, among other things, provided capital to DAVIS for joint business ventures and made two loans to DAVIS for approximately $1 million in total, which DAVIS largely did not repay.
In furtherance of the scheme, and to avoid detection by law enforcement, WALTERS provided DAVIS with a prepaid cellular phone to use when passing Inside Information to WALTERS. Moreover, WALTERS further instructed DAVIS to use code words when discussing the Inside Information, including by referring to Dean Foods as the “Dallas Cowboys.”
Specific Examples of WALTERS’s Insider Trading in Dean Foods
On June 25, 2008, in an unanticipated announcement near the end of the second quarter, Dean Foods informed the public that it had revised upwards its earnings guidance for that quarter. From June 19 to June 23, 2008, WALTERS purchased nearly four million shares of Dean Foods – which constituted between 29 and 37 percent of the daily trading volume of Dean Foods stock on those days – on the basis of tips provided to WALTERS by DAVIS about the second-quarter financial performance. As a result of trading on the Inside Information provided by DAVIS, WALTERS earned realized and unrealized profits of approximately $6 million.
On or about Friday, April 9, 2010, WALTERS and DAVIS met in Las Vegas, Nevada. During that meeting, WALTERS agreed to provide DAVIS with a loan of $625,000, and DAVIS provided Inside Information to WALTERS about Dean Foods’ recent engagement of investment bankers to investigate strategic possibilities related to the separation of WhiteWave-Alpro (the “WhiteWave Spinoff”), a segment of Dean Foods that produced and distributed organic and other branded food and beverage products. On Monday, April 12, 2010, the next trading day, and up through April 15, WALTERS purchased approximately 1.5 million shares of Dean Foods. Less than three weeks later, DAVIS tipped WALTERS about Dean Foods’ forthcoming first-quarter earnings announcement, which DAVIS knew did not meet Wall Street’s expectations. On the following two days, Monday, May 3, and Tuesday, May 4, WALTERS sold the approximately 1.5 million shares of Dean Foods he had purchased in April, which sales constituted 29 and 16 percent, respectively, of the daily trading volume for those days. On May 10, 2010, Dean Foods publicly announced its poor earnings results for the first quarter of 2010 and suspended full-year guidance, which caused the stock to decrease by approximately 28 percent that day. As a result of his timely sales of Dean Foods stock the prior week, WALTERS avoided losses of $7.3 million. Moreover, beginning on May 10, 2010, and continuing through May 14, 2010, WALTERS purchased approximately 1.5 million shares of Dean Foods stock, thereby re-establishing his previous position in the stock at a reduction in cost of $9.5 million.
In addition, on or about May 8, 2012, DAVIS provided Inside Information to WALTERS about Dean Foods’ positive first-quarter earnings and its intention to pursue the WhiteWave Spinoff, on the basis of which WALTERS purchased 1.2 million shares of Dean Foods on May 8 and 9, 2012. On May 9, 2012, Dean Foods announced its earnings results for the first quarter of 2012, which were positive, and that the Company was “mindful of the opportunity . . . to perhaps accrete value for our shareholder.” After this announcement, Dean Foods stock rose by approximately 10 percent. In the ensuing months, DAVIS repeatedly provided WALTERS with additional Inside Information about the WhiteWave Spinoff, including the expected timing of the Spinoff announcement on August 7, 2012. From July 13 through July 31, 2012, WALTERS purchased an additional 2.8 million shares of Dean Foods to raise his total position to 4 million shares.
On August 7, 2012, Dean Foods announced and that it intended to spin off WhiteWave through an initial public offering (“IPO”), and that the Company would maintain ownership over more than 80 percent of WhiteWave stock following the IPO. On August 8, 2012, the day after the announcement, Dean Foods’ stock price increased by approximately 40 percent, netting WALTERS unrealized profits of approximately $17.1 million on his 4 million shares of Dean Foods stock.
After the announcement of the WhiteWave Spinoff, DAVIS continued to provide WALTERS with Inside Information about the forthcoming WhiteWave IPO. By October 25, 2012, the day the IPO was priced above expectations at $17 per share, WALTERS had increased his position in Dean Foods stock to more than 5.3 million shares, which were worth approximately $100 million. By the end of August 2013, after WALTERS received shares of WhiteWave stock in a dividend made to Dean Foods shareholders in May 2013, WALTERS had sold all of his securities in Dean Foods and WhiteWave for gross proceeds of approximately $110 million.
WALTERS’s Insider Trading in Darden Restaurants, Inc.
In or about August 2013, DAVIS received, pursuant to a non-disclosure agreement, a confidential investment plan (the “Investment Plan”) from an investment firm in New York, New York (“Investment Firm A”) related to Darden Restaurants, Inc. (“Darden”), a holding company that owned a number of restaurants. The Investment Plan outlined Investment Firm A’s desire to separate one or more of Darden’s restaurant businesses to unlock additional value in the stock (the “Darden Inside Information”). DAVIS provided this information to WALTERS, who, on August 20 and 21, 2012, purchased 625,000 shares of Darden worth approximately $30 million.
On October 9, 2013, a national newspaper published an article about a significant investment in Darden by Investment Firm A, among others, with the intent to separate Darden into two companies. At the end of the trading day, Darden’s stock price had increased from $46.28 per share to $49.57, resulting in unrealized profits for WALTERS of approximately $1 million.
* * *
WALTERS, 69, is charged with one count of conspiracy to commit securities fraud, four counts of securities fraud, one count of conspiracy to commit wire fraud, and four counts of wire fraud. Count One carries a maximum sentence of five years in prison. Counts Two through Ten 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 May 16, 2016, DAVIS, 67, pled guilty before Judge Castel to one count of conspiracy to commit securities fraud, one count of conspiracy to commit wire fraud, four counts of securities fraud, four counts of wire fraud, one count of obstruction of justice, and one count of perjury. Counts One and Twelve each carry a maximum sentence of five years in prison. Counts Two through Eleven 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 sentences for the defendants will be determined by the judge.
Mr. Bharara praised the work of the FBI and the Postal Inspection Service, and thanked the SEC and the Financial Industry Regulatory Authority (“FINRA”) for their assistance. He also thanked the Las Vegas offices of the FBI and the Internal Revenue Service, Criminal Investigation Division.
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 Brooke E. Cucinella and Daniel S. Goldman are in charge of the prosecution.
The allegations contained in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth herein constitute only allegations, and every fact described should be treated as an allegation.
Westchester Neurologist Pleads Guilty in Manhattan Federal Court to Tax Fraud ViolationRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and Shantelle P. Kitchen, Special Agent in Charge of the New York Office of the Internal Revenue Service-Criminal Investigation (“IRS-CI”), announced that DAVID S. YOUNGER, a neurologist with a private medical practice in Manhattan, pled guilty today in Manhattan federal court to one count of tax fraud for falsely classifying personal expenses as business expenses attributable to his medical professional corporation. In total, in 2007 and 2008, YOUNGER falsely classified over $580,000 in expenses. YOUNGER pled guilty before U.S. District Judge Jed S. Rakoff.
According to the Information and statements made at today’s plea proceeding:
YOUNGER, a resident of Westchester County, is a board-certified neurologist engaged in private medical practice in Manhattan through the David S. Younger M.D., P.C., professional corporation (the “Younger P.C.”). In 2007 and 2008, Younger filed both personal tax returns on behalf of himself and his wife, and corporate tax returns on behalf of the Younger P.C. In 2007, YOUNGER used approximately $250,000 of corporate funds to pay personal expenses, and in 2008, YOUNGER used approximately $335,000 of corporate funds to pay personal expenses. YOUGNER caused all of these expenses falsely to be recorded as business expenses such as medical supplies, office expenses, and professional fees in the books and records of the Younger P.C. YOUNGER caused these expenses falsely to be deducted from income on tax returns of the Younger P.C., and YOUNGER also fraudulently omitted these personal expenses as income on his personal tax returns.
Among the personal expenses that YOUNGER falsely categorized as business expenses and deducted on his corporate tax returns in 2007 and 2008 are the following: approximately $100,000 in fees to a private golf and country club, approximately $53,000 in property taxes for YOUNGER’s residence, a $4,300 placement fee for a nanny/housekeeper, approximately $17,000 for the construction of an electric gate at YOUNGER’s residence, $345 for a Mickey Mantle baseball card, approximately $26,000 for the restoration of a piano that was picked up from and delivered to YOUNGER’s residence, approximately $37,000 for a vendor to perform construction work at YOUNGER’s residence, approximately $18,000 for furniture delivered to YOUNGER’s residence, and at least approximately $20,000 of airfare for members of YOUNGER’s family.
* * *
YOUNGER, 61, of Scarsdale, New York, faces a maximum sentence of three years in prison. As part of his plea agreement, YOUNGER is also required to pay restitution to the IRS. The maximum potential sentence is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. YOUNGER is scheduled to be sentenced by Judge Rakoff on September 19, 2016, at 4:00 p.m.
Mr. Bharara praised the work of the Internal Revenue Service, Criminal Investigation.
This case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorney Richard Cooper is in charge of the prosecution.
###
Westbank Drug Dealer Sentenced to Ten Years in PrisonRead the Press Release
U.S. Attorney Kenneth A. Polite announced that JOEQUELL LEWIS, age 28, of Westwego, was sentenced today to 120 months in federal prison by U.S. District Judge Lance M. Africk.
LEWIS pled guilty to being a member of a twelve-defendant offshoot of the larger Harvey Hustlers group that was involved in the distribution of heroin and crack cocaine in the Avondale and Waggaman areas of Jefferson Parish. LEWIS admitted to selling over one kilogram of heroin on the streets of the Westbank over a two-year period. LEWIS’s co-conspirators have admitted their participation in multiple murders and shootings in Jefferson Parish.
This case is a product of an ongoing investigation into the violent acts in furtherance of the drug trafficking by the Harvey Hustler gang and its various offshoots on the West Bank. It represents the continued coordinated effort of the federal and state law enforcement authorities, including the United States Attorney’s Office, the Jefferson Parish District Attorney’s Office, Special Agents of the Federal Bureau of Investigation, and Officers of the Jefferson Parish Sheriff’s Office.
Assistant United States Attorneys Greg Kennedy, David Haller, and Myles Ranier and Special Assistant United States Attorney Collin Sims, who is a former Assistant United States Attorney and the Criminal Chief at the St. Tammany Parish District Attorney’s Office, are in charge of the prosecution.
West Seneca Man Pleads Guilty to Child Pornography 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 Joseph S. Heleniak, 71, of West Seneca, NY, pleaded guilty to possession of child pornography before U.S. District Judge Lawrence J. Vilardo. The charge carries a mandatory minimum penalty of 10 years in prison, a maximum of 20 years, and a fine of $250,000.
Assistant U.S. Attorney Aaron J. Mango, who is handling the case, stated that between August 30, 2013 and September 1, 2013, the defendant knowingly possessed images of child pornography that were stored on his AOL email account after obtaining them over the internet. Some of the images depicted prepubescent minors. Heleniak was previously convicted of possession of child pornography in 2005 in the Western District of New York and sentenced to 30 months in prison.
The plea is the culmination of an investigation on the part of Special Agents of the Federal Bureau of Investigation, Child Exploitation Task Force, under the direction of Adam S. Cohen, Special Agent in Charge, and the Cheektowaga Police Department under the direction of Chief David Zack. The task force includes the Buffalo Police Department, the Cheektowaga Police Department, and the Niagara County Sheriff’s Office.
Sentencing is scheduled for August 19, 2016 before Judge Vilardo.
Warlock Motorcycle Gang Member Convicted of Drug TraffickingRead the Press Release
PHILADELPHIA – A federal jury, yesterday, returned a guilty verdict against Andrew Carr, 59, of Upper Darby, PA, on the charge of conspiracy to distribute 50 grams or more of methamphetamine. Carr served as the “muscle” and collector of drug debts in a methamphetamine trafficking business which sold approximately $40,000 of methamphetamine monthly in the Philadelphia and Delaware County area. He also sold methamphetamine to his own customers. Carr was a member of the Chester chapter of the Warlocks outlaw motorcycle gang. A sentencing hearing is scheduled for August 17, 2016.
As a result of the investigation, eight members or associates of the drug trafficking business have been convicted. Carr is facing a mandatory minimum sentence of five years in prison with a maximum sentence of 40 years, a possible fine, and up to a lifetime of supervised release.
The case was investigated by the Federal Bureau of Investigations and was prosecuted by Assistant United States Attorney Maria M. Carrillo.
Waldorf Man Indicted for Illegal Transport of Explosives, Illegal Possession of a Machine Gun and Child Pornography OffensesRead the Press Release
Greenbelt, Maryland – A federal grand jury indicted Caleb Andrew Bailey, age 30, of Waldorf, Maryland late yesterday on various charges.
The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Acting Special Agent in Charge Frank Riehl of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; Special Agent in Charge Andre R. Watson of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Postal Inspector in Charge Maria L. Kelokates of the U.S. Postal Inspection Service - Washington Division; and Charles County Sheriff Troy Berry.
According to the four count indictment and court documents, on February 18, 2016, postal police and postal inspectors responded to a postal facility in Capital Heights, Maryland and recovered ammunition and explosives from a package that had ruptured open. ATF was notified by the postal inspectors and responded to evaluate the contents of the package. The contents of the package included 119 rounds of reloaded .50 caliber cartridges with M48A1 incendiary projectiles, and 200 rounds of 14.5mm M183A1 spotting projectiles which contain an explosive charge. The package was addressed to an individual in Wisconsin.
According to court documents, on February 25 and March 3, 2016, the U.S. Postal Service customer service received calls from a person who identified himself by a false name in the first call, and then identified himself as Caleb Bailey in the second call. The caller provided the tracking number for the package recovered by ATF, and advised that the package had not yet been delivered. Neither Bailey nor the individual to whom the package was addressed had a federal explosives license to transport the explosives contained in the package.
According to court documents, law enforcement arranged to meet with Bailey at a postal facility on May 5, 2016, for the stated purpose of having Bailey provide information regarding the missing package in person. Bailey did not appear at the agreed meeting time and place. That day, law enforcement executed federal search warrants at adjoining properties associated with Bailey, including his residence, and seized a machine gun. The indictment alleges that Bailey illegally possessed a machine gun on May 5.
The indictment further alleges that from March 2015 to January 2016, Bailey attempted to use and did use a minor to engage in sexually explicit conduct to produce child pornography. The indictment also alleges that Bailey possessed child pornography.
Bailey faces a maximum sentence of 10 years in prison for unlawful transport of explosives by a non-licensee and for illegal possession of a machine gun; a mandatory minimum of 15 years and a maximum of 30 years in prison for production and attempted production of child pornography; and a maximum sentence of 10 years in prison for possessing child pornography. A criminal complaint was filed on May 6, 2016 charging Bailey with unlawful transport of explosives. Bailey is detained pending a detention hearing on May 24, 2016 at 10:00 a.m. in U.S. District Court in Greenbelt, at which time his initial appearance is also scheduled.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
United States Attorney Rod J. Rosenstein commended ATF- Arson and Explosives Group for the Baltimore Field Division, HSI Baltimore, U.S. Postal Inspection Service - Washington Division and Charles County Sheriff’s Office for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Jennifer R. Sykes and Thomas P. Windom, who are prosecuting the case.
United States Files Lawsuit Alleging That Guild Mortgage Improperly Originated and Underwrote FHA-Insured Mortgage LoansRead the Press Release
The United States has filed a complaint in the U.S. District Court for the District of Columbia against Guild Mortgage Company (Guild) under the False Claims Act for improperly originating and underwriting mortgages insured by the Federal Housing Administration (FHA), the Justice Department announced today. Guild is a mortgage lender headquartered in San Diego, California.
“This case is another example of the Justice Department’s continued efforts to ensure that lenders that participate in the FHA mortgage insurance program act in good faith and conduct appropriate due diligence when committing the United States to insure home loans,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “To protect the housing market and the FHA fund, we will continue to hold responsible lenders that knowingly violate the rules.”
Guild participated in the FHA insurance program as a direct endorsement (DE) lender. As a DE lender, Guild had the authority to originate, underwrite and certify mortgages for FHA insurance. If a DE lender such as Guild approves a mortgage loan for FHA insurance and the loan later defaults, the U.S. Department of Housing and Urban Development (HUD), FHA’s parent agency, is responsible for the losses resulting from the defaulted loan. Under the DE lender program, neither the FHA nor HUD reviews the underwriting of a loan before it is endorsed for FHA insurance. HUD therefore relies on DE lenders to follow program rules designed to ensure that they are properly underwriting and certifying mortgages for FHA insurance and DE lenders must certify that every loan endorsed for FHA insurance is underwritten according to the applicable FHA standards.
The government’s complaint alleges that, from January 2006 through December 2011, Guild knowingly submitted, or caused the submission of, claims for hundreds of improperly underwritten FHA-insured loans. The complaint further alleges that Guild grew its FHA lending business by ignoring FHA rules and falsely certifying compliance with underwriting requirements in order to reap the profits from FHA-insured mortgages. For example, Guild allegedly allowed underwriters to waive compliance with FHA requirements when underwriting a loan. Additionally, Guild used unqualified junior-underwriters who did not have a DE certification to waive mandatory conditions on higher risk loans where HUD required underwriting only by highly trained DE underwriters.
The government’s complaint further alleges that Guild’s senior management focused on growth and profits and ignored quality. From 2006 to 2012, Guild conducted at least 125 branch audits in which almost 40 percent resulted in either a qualified rating or unsatisfactory rating. A qualified rating was defined as having a “significant number of findings, and/or findings noted that have more serious impact or risk to Guild,” or “Knowledge of procedures and controls; however, they appear to be inefficient.” An unsatisfactory rating was defined as one where “serious concerns were noted: lack of knowledge, procedures, and/or controls in branch.” The complaint alleges that, through Guild’s quality control reviews, significant defects were found in over 20 percent of the FHA loans reviewed between 2006 and 2011 and over half the loans had either significant or moderate defects. Significant defects included fraud, misrepresentation and other serious findings while moderate defects included not following guidelines. However, Guild did not calculate or distribute any error rate during the relevant time period, thus management was not presented with these findings. Additionally, for many of the quarters from 2006 through 2009, Guild did not even distribute any of the quality control findings to management. As a result, Guild management often did not review or remediate findings from quality control audits during these years. In the quarters where Guild management actually did review quality control findings, it did so almost a year after the loans closed and failed to timely remediate any identified problems. In 2013, when Guild finally began addressing the quality of its FHA underwriting, Guild’s head of quality control pointed out the ineffectiveness of its past efforts at addressing loan quality: “I’m not optimistic about training reminders and individual follow-ups being all that effective.”
The government’s complaint alleges that as a result of Guild’s knowingly deficient mortgage underwriting practices, HUD has already paid tens of millions of dollars of insurance claims on loans improperly underwritten by Guild, and that there are many additional loans improperly underwritten by Guild that are currently in default and could result in further insurance claims on HUD. For example, the government’s complaint identifies a mortgage loan that was improperly underwritten in violation of HUD requirements, causing the borrower to default and HUD to pay the loss on the loan. Specifically, Guild failed to verify the borrower’s prior rental payments, overstated the borrower’s income, failed to develop a credit history for the borrower who had no credit score, exceeded FHA’s qualifying debt to income ratio without determining whether certain compensating factors were present, and failed to identify the source of a large deposit made to the borrower’s account. The underwriter at Guild improperly waived multiple conditions and allowed an unauthorized junior underwriter to do the same for other conditions. In sworn testimony, the Guild underwriter admitted the loan failed to comply with FHA underwriting requirements.
“The Federal Housing Administration’s insurance program is meant to encourage lenders to expand opportunity for homeownership by providing financing to prospective buyers who otherwise might not be able to enter the housing market,” said U.S. Attorney Channing D. Phillips for the District of Columbia. “To ensure that prospective homebuyers realize the dream of long term homeownership, the program has strict rules and is not a license for lenders to carelessly subject federal dollars to risk. This lawsuit is designed to help the FHA – and American taxpayers -- recoup tens of millions of dollars in losses attributable to a lender accused of improperly underwriting FHA-insured mortgages and committing the government’s guarantee to mortgages that failed to comply with program rules.”
“The decision to intervene in this matter should serve as a reminder of the priority given to pursuing lenders that violate HUD program rules in order to hold them accountable and the value of private citizen participation, including whistleblowers, in pursuing lenders that violate the rules,” said HUD Inspector General David A. Montoya.
“FHA relies on the honesty and integrity of those lenders participating in our program,” said HUD’s General Counsel Helen R. Kanovsky. “The action we take today should send a clear message that we will not tolerate the abuse of our programs or of the families who should benefit from them.”
The lawsuit was brought under the qui tam, or whistleblower, provisions of the False Claims Act by a former employee of Guild. Under the act, a private party may bring suit on behalf of the United States and share in any recovery. The government may intervene in the case, as it has done here. The False Claims Act allows the government to recover treble damages and penalties from those who violate it.
The investigation of this matter was a coordinated effort among HUD, its Office of Inspector General, and the U.S. Attorney’s Office for the District of Columbia and the Civil Division’s Commercial Litigation Branch.
The action is captioned United States ex rel. Dougherty v. Guild Mortgage Company (D.D.C.). The claims asserted in the complaint are allegations only and there has been no determination of liability.
U.S. Attorney Patrick Miles's "Justice Scholars" Program Culminates with Mock Trial Before Federal and State JudgesRead the Press Release
GRAND RAPIDS, MICHIGAN — At the beginning of the 2015–2016 school year, U.S. Attorney Patrick Miles introduced Justice Scholars to a class of seventh-grade students at Gerald R. Ford Academic Center, a Grand Rapids Public School. The new program was developed by U.S. Attorney Miles to expose students to the criminal justice system in a constructive way, while fostering positive connections between youth, law enforcement, and the broader legal community.
Each month over the course of the school year, the class heard from “teachers” who work in the criminal justice system. The interactive presentations took the scholars through the foundations and aims of the criminal justice system, the stages of a criminal case, and possible career paths. Presenters encouraged students to make healthy and constructive decisions during their middle- and high-school years, so they could pursue jobs in the criminal justice system in the future. U.S. Attorney Miles said that the “overwhelming volunteer response by law enforcement and legal partners in the community made the pilot year of Justice Scholars a tremendous success.”
Federal Bureau of Investigation Special Agent Sean Burns, and Chief of Staff for Grand Rapids Public Schools, Larry Johnson, himself a retired police sergeant, taught the students about criminal investigations, interviewing witnesses, and analyzing evidence. Forensic technicians from the Grand Rapids Police Department brought materials and tools so students could get hands-on experience “lifting” fingerprints from objects. Assistant United States Attorneys explained the roles and ethical responsibilities of prosecutors. Along with others from the Federal Public Defender’s Office, Interim Federal Defender Sharon Turek discussed the importance of quality legal representation for criminal defendants. United States Magistrate Judge Ellen S. Carmody talked with the class about the role of the judge in a criminal case, as well as her path to the bench. United States Probation Officer Mathew Erickson discussed the supervision of individuals on probation and federal supervised release, and Grand Rapids Police Department Sergeant Terry Dixon talked with students about some of the difficulties faced by defendants when they return to their communities after prison.
For many students, the end of the school year reflects a winding-down of activities and work. But for Justice Scholars, May is the busiest month: the program culminates with mock criminal trials, before actual judges. Today, after weeks of preparing a hypothetical bank robbery case, the seventh-grade Justice Scholars conducted mock trials in federal and state courtrooms before four judges: Judge Jane M. Beckering, Third District Michigan Court of Appeals; Chief Judge Robert J. Jonker, United States District Court for the Western District of Michigan; United States Magistrate Judge Ray Kent, United States District Court for the Western District of Michigan; and Judge Christopher P. Yates, 17th Circuit Court of Michigan, Kent County. Classroom teacher Emily Thornburg observed that, in preparing for the trials, many students made great strides in the areas of critical thinking and public speaking.
Students from Western Michigan University Cooley Law School and employees of the United States Attorney’s Office acted as civilian witnesses in the trials, while FBI Special Agents “acted” as FBI Special Agents. After working with students for several hours in the classroom over the past several weeks, attorneys from the criminal defense bar, the Federal Defender’s Office, and the United States Attorney’s Office provided advice and support, throughout the trials, to the seventh-grade prosecutors and defenders. Students from the eighthgrade class at Gerald R. Ford Academic Center served as jurors in each courtroom.
Whether the hypothetical defendants were found guilty or not guilty of bank robbery, the real Justice Scholars on both sides of the case deserve congratulations and praise for their hard work and enthusiasm in the program’s inaugural year.
END
Two Men Sentenced in Connection with Murder in Chautauqua CountyRead 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 Jonathan Conklin, 45, who was convicted of carjacking, was sentenced to 25 years in prison by Senior U.S. District Judge William M. Skretny. The sentence will be served consecutive to a 25 years to life sentence Conklin received in Chautauqua County Court for murder.
In addition, Judge Skretny sentenced co-defendant Charles Sanford, 32, to 15 years for unlawful possession of a firearm and conspiracy to transport a stolen vehicle in interstate commerce.
“The victim in this case, Mary Whitaker, represented the best of our community,” said U.S. Attorney Hochul. “While the defendants' cowardly actions may have taken her life, they will never extinguish her generous and caring spirit which continues to live on in all who knew her.”
Assistant U.S. Attorney Timothy C. Lynch, who handling the case, stated that Conklin and Sanford robbed Mary Whitaker inside her Sherman, NY home on August 20, 2014. The two men approached the victim’s home and Sanford rang the doorbell. Soon after Whitaker answered the door, Conklin shot and killed her. Conklin and Sanford then stole her vehicle and drove it to Erie, Pennsylvania where they were arrested on August 22, 2014.
U.S. Attorney Hochul further stated “Today's sentence all but guarantees that these defendants will never be in position to injure another person.”
The sentencings are the culmination of an investigation on the part of the Chautauqua County Sheriff’s Office, under the direction of Sheriff Joseph A. Gerace, the Chautauqua County District Attorney’s Office, under the direction of Acting District Attorney Patrick Swanson, the Federal Bureau of Investigation, under the direction of Special Agent in Charge Adam S. Cohen, and the City of Erie (Pennsylvania) Police Department, under the direction of Chief Randy M. Bowers.Two Men Plead Guilty in Major Cocaine ConspiracyRead 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 Alvin Torres, Jr. pleaded guilty to conspiracy to possess with intent to distribute, and to distribute, cocaine, before U.S. District Judge Elizabeth A. Wolford. The charge carries a maximum penalty of 20 years in prison and a $1,000,000 fine. In addition, Rafael Burgos, Jr. pleaded guilty to conspiracy to possess with intent to distribute, and to distribute, five kilograms or more of cocaine which is punishable by a mandatory minimum 10 years in prison, a maximum of life and a $10,000,000 fine.
Assistant U.S. Attorney Michael J. Adler, who is handling the case, stated that between 2013 and June 10, 2015, law enforcement officers investigated a drug trafficking organization led by defendants Burgos and David Jesus Pagan. During the course of the investigation, it was determined that the defendants distributed multiple kilograms of cocaine throughout the Dunkirk area.
Burgos and Torres were arrested in June of 2015 along with Samuel Hernandez III, Javier Pagan, Jr., David Jesus Pagan, and Angel Pierluissi. Search warrants were executed at the time of the arrests at six properties which resulted in the recovery of more than seven kilograms of cocaine (the largest seizure ever in the City of Dunkirk) and approximately $175,000 in cash as well as an AR-15 assault rifle with a 30 round magazine. During a search of Burgos’ residence, officers discovered a secret room with a money counting machine.
Hernandez and Javier Pagan, Jr. have been convicted and are awaiting sentencing. Charges are pending against David Jesus Pagan and Angel Pierluissi. 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.
The pleas are the result of an investigation by the Drug Enforcement Administration, under the direction of Special Agent in Charge James J. Hunt, New York Field Office, the Dunkirk Police Department, under the direction of Chief David C. Ortolano, the Chautauqua County Sheriff’s Office, under the direction of Sheriff Joseph A. Gerace, the Cattaraugus County Sheriff’s Office, under the direction of Sheriff Timothy S. Whitcomb, and the Chautauqua County District Attorney’s Office, under the direction of Patrick Swanson.
Torres will be sentenced on September 7, 2016 at 10:30 a.m. before Judge Wolford. Sentencing of Burgos will be scheduled at a later date.
Two Men Indicted on Federal Drug Trafficking ChargesRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that two men allegedly involved in drug trafficking in York and Berks Counties were indicted yesterday by a federal grand jury in Harrisburg.
According to United States Attorney Peter Smith, Ruben Guadalupe Morales, age 25, and Jose G. Avila, age 28, both of Reading, were charged in an indictment with conspiracy to distribute and possess with intent to distribute five kilograms and more of cocaine hydrochloride and 280 grams of crack cocaine during January through April 2016. Each man was also accused of possessing with intent to distribute cocaine on April 27, 2016. Avila was also charged with possessing firearms in furtherance of drug trafficking. The indictment also seeks the forfeiture of U.S. currency totaling approximately $137,000 seized by law enforcement agencies during the investigation conducted by the Drug Enforcement Administration and the York City Police Department.
Both men were arrested on April 27.
The case is assigned to Assistant U.S. Attorney Christy H. Fawcett.
If convicted each defendant faces a maximum sentence of life imprisonment, a $10,000,000 fine, and a lifetime of supervised release. Avila is also subject to a five-year mandatory minimum for the firearms charge which must be served consecutive to any other sentence imposed.
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.
Under the Federal Sentencing Guidelines, the Judge is 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.
# # #
Two Arrested for Possession of Firearms Stolen from Federally Licensed Firearms DealerRead the Press Release
Orlando, Florida – United States Attorney A. Lee Bentley, III announces the filing of a criminal complaint and arrests of Kimberly Carnell White, Jr. (27, Orlando) and James Romando Harris, II (28, Orlando) for possession of firearms by convicted felons. If convicted, each faces up to 10 years in federal prison.
According to the complaint, a federally licensed firearms dealer in Marion County was burglarized during the morning of May 5, 2016. Later that day, ATF received information that White had several firearms to sell that came from a location he claimed to have “hit.” That same day, undercover agents from the Orange County Sheriff’s Office purchased five firearms from White and Harris. The serial numbers of those firearms matched those of the firearms that had been stolen from the federally licensed firearms dealer. Both White and Harris have prior felony convictions and therefore are prohibited from possessing firearms or ammunition under federal law.
On May 13, 2016, the Orange County Sheriff’s Office, the Orlando Police Department, and ATF executed federal search warrants at the Orlando residences where the undercover transactions had been conducted and where other firearms had been seen. During the execution of those warrants, law enforcement recovered seven firearms from one residence and four firearms from the other residence. Of those 11 firearms, 4 of them had serial numbers that matched those of the firearms reported stolen from the federally licensed firearms dealer. In total, investigators have seized 16 firearms, including 9 that were reported stolen from the firearms dealer.
These arrests were the result of a multi-agency investigation focused on the recovery of the firearms. This investigation is ongoing.
“These arrests demonstrate the resolve our local, state and federal partners have to keep guns off the streets, and put the felons that traffic in illegal firearms behind bars,” said Orange County Sheriff Jerry L. Demings. “Together we will continue to seek out any other subjects who assisted in this crime and who would endanger our children and communities.”
“By working together with our law enforcement partners at the Orange County Sheriff’s Office, the U.S. Attorney's Office and ATF, we were able to get 16 illegal guns off the street,” said Orlando Police Chief John Mina. “Any time we can get crime guns out of the hands of criminals it's a victory for all of us.”
“I applaud the ATF special agents and the investigators with the Orange County Sheriff's Office and the Orlando Police Department for their excellent work in quickly arresting these individuals selling stolen guns,” said ATF Special Agent in Charge Regina Lombardo. “This investigation will make our communities safer but we still have more work to do in recovering all of the guns stolen from a licensed federal firearms dealer.”
A criminal complaint is merely an allegation that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This case is being investigated by the Orange County Sheriff’s Office, the Orlando Police Department, the Marion County Sheriff’s Office, the Belleview Police Department, and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. It will be prosecuted by Assistant United States Attorney Sean P. Shecter.
Three from Northeast Ohio indicted for distributing cocaineRead the Press Release
Three people from Northeast Ohio were arrested this morning for their roles in a cocaine distribution conspiracy, said Acting U.S. Attorney Carole S. Rendon and Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland office.
Named in the nine-count indictment are: Christopher Fitzgerald, 41, of Bedford Heights; Rashard Smith, 42, of Northfield, and Chiquita Anderson, 42, of Bedford.
Fitzgerald and Smith worked as couriers at a domestic shipping company and used their positions to ship kilograms of cocaine from California to Cleveland. Anderson maintained a premises to assist in the cocaine distribution, according to the indictment.
Prosecutors are seeking to forfeit the money involved in the alleged crime.
This case is being prosecuted by Assistant U.S. Attorneys Margaret Sweeney and Michelle M. Baeppler following an investigation by the Northern Ohio Law Enforcement Task Force.
If convicted, the defendants’ sentences will be determined by the court after a review of the federal sentencing guidelines and factors unique to the case, including the defendants’ prior criminal records (if any), the defendants’ role in the offense, and the characteristics of the violation.
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.
Texas Man Coordinated Cocaine Shipments in Large Scale Drug Trafficking SchemeRead the Press Release
ERIE, Pa. – A former resident of Houston, Texas, pleaded guilty in federal court in Pittsburgh, Pennsylvania to a charge of violating federal drug laws, United States Attorney David J. Hickton announced today.
Raul Gerardo Ruiz Maldonado, 42, pleaded guilty to one count before United States District Judge David S. Cercone.
In connection with the guilty plea, the court was advised that from June 2013 through February 2015, Maldonado engaged in a conspiracy with eighteen co-defendants to distribute and possess with intent to distribute between 50 and 150 kilograms of cocaine. According to information provided to the Court, the investigation revealed that an Erie area drug trafficking organization was being sourced primarily cocaine from individuals in Texas associated with organizations in Mexico. The drugs were imported into the United States and were then brought into Houston, Texas. Once in Houston, co-conspirators coordinated the drug loads to be brought into Ohio and Pennsylvania. According to information provided to the Court, the cocaine was transported from Houston, Texas to Erie, Pennsylvania and elsewhere using vehicles rigged with hidden compartments. The Court was advised that Ruiz Maldonado, known as Nariz, became the coordinator of the shipments of cocaine out of Texas to the Erie, Pennsylvania based organization. Members of the conspiracy in Erie would contact Ruiz Maldonado in Texas and place orders for the cocaine. Ruiz Maldonado would then work closely with other co-conspirators to communicate with the organizations’ drug couriers as they traveled to Texas. Ruiz Maldonado and others then arranged for the drug courier vehicle to arrive at the distribution point, to receive the shipments of drug money, and to coordinate loading the kilograms of cocaine into the hidden compartment.
Judge Cercone scheduled sentencing for September 15, 2016 at 10:45 a.m. The law provides for a maximum total sentence of life in prison, a fine of $4,000,000, 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, if any, of the defendant.
Assistant United States Attorney Marshall J. Piccinini is prosecuting this case on behalf of the government.
The Homeland Security Investigations, the Drug Enforcement Administration, the Pennsylvania State Police, U.S. Border Patrol, the Internal Revenue Service, Criminal Investigation; the Pennsylvania Office of Attorney General Organized Crime Section, the U.S. Postal Inspection Service, the U.S. Marshals Service, the Bureau of Alcohol Tobacco Firearms and Explosives and the Arkansas State Police conducted the investigation that led to the prosecution of Maldonado.
Syracuse Man Pleads Guilty to Failing to Register as A Sex OffenderRead the Press Release
SYRACUSE, NEW YORK –Carl Switala, 34, of Syracuse, New York, pled guilty yesterday to failing to register as a sex offender, announced United States Attorney Richard S. Hartunian.
Switala was charged with violating the Sex Offender Registration and Notification Act ("SORNA"), which requires a convicted sex offender to register, and keep that registration current, wherever he or she resides, is employed, or is a student. As part of his guilty plea, Switala admitted that he was previously convicted of Criminal Sexual Conduct in the First Degree in Michigan, which required him to register as a sex offender for the rest of his life, and that he had moved from North Carolina to Syracuse in November 2015 without ever registering in New York or updating his registration in North Carolina.
As a result of his conviction, Switala now faces a maximum sentence of 10 years imprisonment, a fine of up to $250,000, and a term of supervised release of at least 5 years and up to life. Sentencing is scheduled for September 15, 2016 before U.S. District Judge David N. Hurd.
This case was investigated by the United States Marshal Service Sex Offender Investigation Branch and is being prosecuted by Assistant U.S. Attorney Robert S. Levine.
This case is prosecuted as part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the United States Attorneys’ Offices, 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 identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
Swain County Woman Sentenced to 10 Years for Killing Her HusbandRead the Press Release
ASHEVILLE, N.C. – Pattie Sue Bradley, 43, of Cherokee, N.C. and an enrolled member of the Eastern Band of Cherokee Indians, was sentenced today to 120 months in prison for killing her husband, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. U.S. District Judge Martin Reidinger also sentenced Bradley to three years of supervised release following her prison term.
U.S. Attorney Rose is joined in making today’s announcement by John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Chief James Dike Sneed of the Cherokee Indian Police Department (CIPD).
According to the information to which Bradley pleaded guilty, other documents filed in this case and statements made in court, on or about January 13, 2015, in Swain County, in Indian Country, that is within the boundaries of the Eastern Band of Cherokee Indians reservation, Bradley stabbed and killed her husband, Henry Bradley, also an Indian. Court records show that CIPD arrived at the Bradleys’ residence in response to a 911 call. When the responding officer asked Pattie Bradley about what had occurred, Bradley told him that another individual had tried to break into the house and she had cut him with a knife.
According to court records, the officer then noticed that the victim was sitting and passed out on the couch inside the couple’s home. The officer also observed that the victim’s hands were covered with blood. Pattie Bradley stated that the victim had a cut on his hand but when emergency technicians arrived at the scene they determined that the victim had actually been stabbed once in the abdomen. The victim was transported to the hospital, where he later died. On January 14, 2015, CIPD interviewed Pattie Bradley who told the officers that on the night of the incident she and the victim had been drinking and arguing, and she admitted to stabbing the victim over the course of the argument.
Bradley pleaded guilty on October 23, 2015 to one count of assault with intent to commit murder. She is currently in custody and upon designation of a federal facility she will be transferred to the custody of the Federal Bureau of Prisons. Federal sentences are served without the possibility of parole.
The FBI and CIPD investigated the case. Assistant U.S. Attorney John Pritchard prosecuted the case.