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22 June 2016
Convicted Sex Offender Sentenced to 94 Months in Prison for Sexually Abusing a Child While Failing to Register as a Sex OffenderRead the Press Release
WASHINGTON – Andre Hammond, 35, of Washington, D.C., has been sentenced to 94 months in prison for sexually abusing a female child and committing a crime of violence while failing to register as a sex offender, announced U.S. Attorney Channing D. Phillips and Michael Hughes, U.S. Marshal for the Superior Court of the District of Columbia.
Hammond pled guilty in September 2014, in the U.S. District Court for the District of Columbia, to one count of failure to register as a sex offender and one count of commission of a crime of violence while failing to register as a sex offender, in violation of the Sex Offender Registration and Notification Act (SORNA). He also pled guilty to one count of second-degree child sexual abuse. He was sentenced on June 21, 2016, by the Honorable Ketanji Brown Jackson. Following his prison term, Hammond will be placed on 20 years of supervised release.
Hammond has one prior misdemeanor conviction, in 2009, in the District of Columbia for a sex offense involving a different minor female victim, which requires him to register as a sex offender. According to the government’s evidence, he initially registered in the District of Columbia but soon moved to Maryland and did not register his new address with the District of Columbia Sex Offender Registry or with any Maryland registry. In 2011, Hammond moved from Maryland back to the District, but continued to falsely register a District of Columbia address where he was not actually residing. While failing to properly register as a sex offender in the District of Columbia, Hammond then committed a new sex offense involving a child who he repeatedly molested over the course of almost four years. He was arrested in October 2013.
As part of an overall strategy to combat child exploitation, the U.S. Marshals Service launched a nationwide operation to target sex offenders who violate SORNA by knowingly failing to comply with their sex offender registration requirements. SORNA is part of the Adam Walsh Child Protection and Safety Act of 2006. The Adam Walsh Act also provides for the use of federal law enforcement resources, including the U.S. Marshals Service, to assist states in locating and apprehending non-compliant sex offenders.
In announcing the sentence, U.S. Attorney Phillips and U.S. Marshal Hughes praised the work of Senior Inspector Floriano Whitwell and other members of the D.C. Superior Court Sex Offender Investigations Section of the U.S. Marshals Service, who investigated the case. They also expressed appreciation for the work of those who handled the case at the U.S. Attorney’s Office, including Paralegal Specialist Donhue Troy Griffith, Victim/Witness Advocate Elsa Maltese, Forensic Child Interviewer Karen Giannakoulias, and Criminal Investigator John Marsh. Finally, they commended the work of former Assistant U.S. Attorney Heide Herrmann and Assistant U.S. Attorney Sarah McClellan, who prosecuted the case.
Charleston heroin dealer sentenced to Federal prison for drug crimeRead the Press Release
CHARLESTON, W.Va. – A Charleston man was sentenced to a year and nine months in federal prison for a heroin crime, announced Acting United States Attorney Carol Casto. Justin Randolph, 27, previously entered his guilty plea to distribution of heroin.
Randolph admitted that on January 15, 2015, he sold heroin to a confidential informant working with the Kanawha County Sheriff’s Office. The drug deal took place in the Kroger parking lot in Dunbar.
The Kanawha County Sheriff’s Office, the Metropolitan Drug Enforcement Network Team, and the West Virginia State Police conducted the investigation. Assistant United States Attorney John J. Frail is handling the prosecution. United States District Judge Thomas E. Johnston imposed the sentence.
This case was prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and heroin. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of pills and heroin in communities across the Southern District.
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Champaign Roofer Charged with Immigration ViolationsRead the Press Release
Springfield, Ill. – The owner of Gire Roofing, Inc., and its corporate parent, Grayson Enterprises, Inc., of Champaign, Ill., have been charged on multiple federal immigration violations. Edwin J. Gire made his initial appearance in federal court in Springfield on June 21, 2016, before U.S. District Judge Sue E. Myerscough. A trial date of Aug. 2, 2016, is scheduled for Gire and Grayson Enterprises, doing business as Gire Roofing, Inc., in Springfield.
On June 8, 2016, a federal grand jury returned the 10-count indictment that charges Gire with visa immigration fraud (four counts), harboring illegal aliens (three counts), and unlawful employment of aliens (three counts). The indictment also charges Grayson Enterprises, Inc. in eight of the ten counts and seeks forfeiture of the Gire Roofing property located at 309 West Hensley Road in Champaign, Ill., which is alleged to have been used to facilitate the commission of the offenses.
The indictment alleges that in March 2011, August 2011, March 2013, and April 2014, Gire submitted petitions to the U.S. Department of Labor and to the U.S. Department of Homeland Security to obtain foreign workers to perform roofing work in Champaign County and Douglas County, Ill. The indictment further alleges that to support the need for workers, Gire submitted contracts that he knew were false with the petitions, causing the State Department to issue H-2B non-immigrant worker visas to more than 150 foreign workers.
The indictment further alleges that from 2008 to 2014, Gire engaged in a practice and pattern of knowingly hiring unauthorized aliens, and in 2014, harbored those same illegal aliens in Champaign County, Ill., for the purpose of commercial advantage and private financial gain.
If convicted, each count of visa fraud and harboring illegal aliens carries a penalty of up to ten years in prison and a $250,000 fine. The unlawful employment of aliens charges carry a penalty of up to six months imprisonment and a maximum fine of $3,000 for each unauthorized alien employed.
The charges are the result of investigation by the U.S. Department of State, Diplomatic Security Service; the U.S. Department of Labor, Office of Inspector General; U.S. Immigration and Customs Enforcement Homeland Security Investigations; and, the Internal Revenue Service, Criminal Investigation Division. The case is being prosecuted by Assistant U.S. Attorney Eugene L. Miller.
Members of the public are reminded that an indictment is merely an accusation; the defendant is presumed innocent unless proven guilty.
Buffalo Man Pleads Guilty to Stealing Funds Intended for Buffalo SchoolsRead 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 Hassan El Saddique, 36, of Amherst, NY, pleaded guilty to theft of money in control and possession of a bank before Senior U.S. District Judge William M. Skretny. The misdemeanor charge carries a maximum penalty of one year in prison and a $100,000 fine.
Assistant U.S. Attorney Richard A. Resnick, who is handling the case, stated that between June 2009 and October 2010, the defendant made it appear that he had entered into a contract for consultant services with the Buffalo Board of Education. The alleged contract falsely stated that El Saddique would perform services at the Universal School. The defendant never provided services at the school.
At the beginning of the 2009-2010 school year, El Saddique did begin assisting with the Title I Program at Bishop Timon High School. These services were performed voluntarily and without pay.
However, between October 2009 and October 2010, the defendant submitted 19 fraudulent invoices to the Buffalo Board of Education for payment for services that were never performed or done voluntarily at the Universal School and Bishop Timon high School. El Saddique received 18 checks totaling $15,120 and retained a portion of those funds.
On June 1, 2016, the defendant’s mother, Debbie Buckley, was convicted of theft of government funds. Buckley served as Supervisor of Title I, Office of Federal and State Programs for the Buffalo School District. Title I is a federally funded program that provides assistance to school districts with high numbers of children from low income families. In March 2010, Buckley was promoted to Assistant Superintendent of Federal and State Programs.
Buckley changed the approval process by which a contractor was paid for Title I services provided in non-public schools. She eliminated the need for a signature from an official at the non-public school. Buckley did this so that she could sign the fraudulent invoices submitted by her son authorizing the payment of the invoices. The dates of some of these invoices coincide with the period during which Buckley was promoted to Assistant Superintendent.Today’s plea is the culmination of an investigation on the part of Special Agents of the Federal Bureau of Investigation, under the direction of Special Agent in Charge Adam S. Cohen and the U.S. Department of Education, Office of Inspector General, under the direction of Assistant Special Agent in Charge Geoff Wood.
Sentencing is scheduled for October 26, 2016 at 11:00 a.m. before Judge Skretny.
Brownsburg man arrested on terrorism chargesRead the Press Release
18 year old attempted to travel to the Middle East in material support of ISIL
PRESS RELEASE
Indianapolis – United States Attorney Josh J. Minkler and FBI Special Agent in Charge W. Jay Abbott of the FBI’s Indiana Division announced today the arrest of a Brownsburg, Indiana, man on charges of providing material support to the Islamic State of Iraq and the Levant (ISIL). Akram Musleh, age18, was arrested by FBI agents while attempting to board a bus from Indianapolis to New York where he was to fly to and transit through Morocco to ISIL-controlled territory. The criminal complaint alleges that from there, he was to provide material support by joining ISIL.
“The radicalization of American citizens by terrorist organizations like ISIL is a threat to our safety here and abroad,” said Minkler. “I am committed to using the full authority of the United States Attorney’s Office to identify, investigate and prosecute those that materially support terrorism. I would like to thank the Federal Bureau of Investigation, the Brownsburg Police Department and the Indianapolis Metropolitan Police Department for working with us during this investigation. We will continue to work closely with our law enforcement partners but as in this case, we rely heavily on the public’s assistance to help make our community safe.”
“Terrorism is the FBI’s number one priority and we work closely with our law enforcement partners to ensure the safety of our community,” said Abbott. “This case demonstrates the value of law enforcement collaboration and community engagement.”
A criminal complaint is only a charge and not evidence of guilt. All defendants are presumed innocent until proven otherwise in federal court.
According to Assistant United States Attorneys Bradley Shepard and Doris Pryor who are prosecuting this case for the government, Musleh faces a maximum sentence of 20 years in prison, a lifetime of supervised release and a $250,000 fine if convicted.
Brandon Woman Arrested for Medicaid Fraud During National TakedownRead the Press Release
The Office of the United States Attorney for the District of Vermont announced that Misti Baker, 36, of Brandon, Vermont, was arrested today as part of a national healthcare fraud takedown. U.S. Magistrate Judge John M. Conroy ordered Baker detained pending a detention hearing on June 24, 2016.
On June 8, 2016, a federal grand jury in Rutland returned an indictment charging Baker with health care fraud. According to the indictment, Baker defrauded the State of Vermont’s Children’s Personal Care Services (CPCS) program. CPCS, which is jointly funded by federal and Vermont Medicaid dollars, is designed to provide supplemental assistance with self-care and activities of daily living to Medicaid-eligible children with significant disabilities or health conditions. Three of Baker’s children qualified for the CPCS program. The indictment alleges that Baker submitted false time sheets and diverted funds for her own use, rather than obtaining supplemental assistance for her children. The indictment charges Baker with submitting false time sheets and fraudulently diverting approximately $77,306.57 in health care funds.
The United States Attorney emphasized that the charges in the indictment are merely accusations and that the defendant is presumed innocent unless and until she is proven guilty. If convicted, Baker faces up to ten years’ imprisonment, and a fine of up to $250,000. The actual sentence would be determined with reference to federal sentencing guidelines.
Baker was arrested today as part of a nation-wide initiative to combat health care fraud. Over 30 federal districts, from Alaska to Florida, unveiled charges against approximately 300 defendants who participated in a variety of schemes which involved more than $900 million of fraud. The national initiative is described more fully in a press release issued by the Department of Justice earlier today and available at https://www.justice.gov/opa/pr/national-health-care-fraud-takedown-results-charges-against-301-individuals-approximately-900.
United States Attorney, Eric S. Miller, commended the investigative efforts of the Department of Health and Human Services Office of Inspector General, Boston Regional Office, and the Vermont Medicaid Fraud Control Unit. Miller added, “Health care fraud is not an abstract or victimless crime. The defendants pursued by the Department of Justice and the Department of Health and Human Services in this operation have allegedly enriched themselves by stealing taxpayer money designated to help people who are most in need.”
The United States is represented in this case by Assistant U.S. Attorney Jonathan Ophardt. Baker is represented by Christopher L. Davis, Esq. of Langrock, Sperry, & Wool, LLP.
Bergen County, New Jersey, Woman Admits Role in Cocaine Trafficking ConspiracyRead the Press Release
NEWARK, N.J. – A Bergenfield, New Jersey, woman today admitted her role in a conspiracy to traffic approximately two kilograms of cocaine from Puerto Rico to New Jersey, U.S. Attorney Paul J. Fishman announced.
Sasha Melendez, 37, pleaded guilty before U.S. District Judge Claire C. Cecchi in Newark federal court to an information charging her with one count of conspiring to distribute cocaine.
According to documents filed in this case and statements made in court:
Melendez was the subject of an investigation by the U.S. Postal Inspection Service and the Drug Enforcement Administration (DEA) of an ongoing conspiracy to import cocaine from Puerto Rico. She was arrested on March 24, 2015 in Bergen County after she accepted delivery of a mail parcel from Puerto Rico containing approximately two kilograms of cocaine. Melendez admitted today that she conspired with co-defendant Ramis Esteves, 33, of New York, to distribute the cocaine.
The conspiracy charge to which Melendez pleaded guilty today carries a maximum potential penalty of 20 years in prison and $1 million fine. Sentencing is scheduled for Oct. 4, 2016.
The charge and allegations against Esteves are merely accusations, and he is presumed innocent unless and until proven guilty.
U.S. Attorney Fishman credited postal inspectors of the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Cynthia L. Shoffner, and special agents of the DEA, under the direction of Special Agent in Charge Carl J. Kotowski, with the investigation.
The government is represented by Assistant U.S. Attorney Jonathan M. Peck of the U.S. Attorney’s Office General Crimes Unit.
Defense Counsel: Stacey Van Malden, Esq.
Bath Resident Charged with Attempting to Transfer Obscene Material to a MinorRead the Press Release
Contact: Craig M. Wolff
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced today that Garrett G. Brosnan, 25, of Bath, Maine, was arrested yesterday and charged in U.S. District Court by criminal complaint with attempting to transfer obscene material to a minor.
According to court records, on two occasions earlier this month, Brosnan sent obscene material to an individual who he believed to be a 14-year-old girl. In fact, the recipient of the material was an agent with U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI).
The defendant will make an initial appearance in the U.S. District Court in Portland today.
He faces up to 10 years in prison and a $250,000 fine.
This case was investigated by HSI.
A criminal complaint is merely an accusation and a defendant is presumed innocent unless proven guilty in a court of law.
Arsonist of BLC Automotive Sentenced to More Than 5 Years in Federal PrisonRead the Press Release
Jacksonville, Florida – U.S. District Judge Timothy J. Corrigan has sentenced Steven Villareal (30, Jacksonville) to five years and three months in federal prison for the arson of BLC Automotive on Blanding Boulevard. He was also ordered to pay BLC Automotive restitution in the amount of $30,000. Villareal pleaded guilty on February 29, 2016.
According to court documents, on February 17, 2014, Villareal entered BLC Automotive at approximately 3:00 a.m. Once inside, he used an acetylene torch to cut into a safe from which he stole a large sum of cash. He then used an accelerant to start a fire inside the business. An officer from the Jacksonville Sheriff’s Office saw the fire and alerted the Jacksonville Fire and Rescue Department, who responded quickly and extinguished the fire. The interior of BLC Automotive was badly damaged, but the structure survived the fire.
This case was investigated by the Jacksonville Sheriff’s Office, the State Fire Marshal, and the Bureau of Alcohol, Tobacco, Firearms and Explosives. It was prosecuted by Assistant United States Attorney Frank Talbot.
Armstrong County Woman Pleads Guilty to Stealing Money from Greeting CardRead the Press Release
PITTSBURGH –A former Armstrong County resident pleaded guilty in federal court to a charge of theft of mail, United States Attorney David J. Hickton announced today.
April Kovach, age 40, formerly of Yatesboro, Pa., pleaded guilty to one count before Senior United States District Judge Gustave Diamond.
In connection with the guilty plea, the court was advised that on or about Oct. 8, 2014, Kovach, a then-highway contract route driver for the U.S. Postal Service in Kittanning, did abstract and remove two $20 Federal Reserve notes that had been the contents of a greeting card envelope addressed to an individual in Cranberry Township.
Judge Diamond scheduled sentencing for Oct. 19, 2016, at 10 a.m. The law provides for a total sentence of five 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 Shardul S. Desai is prosecuting this case on behalf of the government.
The United States Postal Service – Office of Inspector General conducted the investigation that led to the prosecution of Kovach.
Alexandria woman pleads guilty to stealing deceased grandmother’s Social Security benefitsRead the Press Release
ALEXANDRIA, La. – United States Attorney Stephanie A. Finley announced that a woman from Alexandria pleaded guilty Monday to stealing more than $36,000 in Social Security benefits.
Keyoka Jynes, 36, of Alexandria, pleaded guilty before U.S. District Judge Dee D. Drell to one count of theft of government property. According to the guilty plea, Jynes stole $36,442 of supplemental Social Security income benefits from April 2008 until December 2013. Jynes did not notify the Social Security Administration (SSA) that her grandmother died in March 2008 and continued to receive her SSA benefits through 2013.
Jynes faces up to 10 years in prison, three years supervised release, a $250,000 fine and restitution. A sentencing date of September 26, 2016 was set.
The Social Security Administration, Office of Inspector General, conducted the investigation. Assistant U.S. Attorney James G. Cowles Jr. is prosecuting the case.
After UBS Produces Singapore-Based Documents, Justice Department Dismisses Summons CaseRead the Press Release
UBS AG has complied with an Internal Revenue Service (IRS) summons for bank records held in its Singapore office, the Justice Department announced today. Because UBS has now produced all Singapore-based records responsive to the request and the IRS determined that UBS complied with the summons, the Justice Department has voluntarily dismissed its summons enforcement action against the bank.
The IRS served an administrative summons on UBS for records pertaining to accounts held by Ching-Ye “Henry” Hsiaw. According to the petition, the IRS needed the records in order to determine Hsiaw’s federal income tax liabilities for the years 2006 through 2011. Hsiaw transferred funds from a Switzerland-based account with UBS to the UBS Singapore branch in 2002, according to the declaration of a revenue agent filed at the same time as the petition. UBS refused to produce the records, and the United States filed its petition to enforce the summons.
“The Department of Justice and the IRS are committed to making sure that offshore tax evasion is detected and dealt with appropriately,” said Acting Assistant Attorney General Caroline D. Ciraolo of the Tax Division. “One critical component of that effort is making sure that the IRS has all of the information it needs to audit taxpayers with offshore assets. In this case, we filed a petition to enforce a summons for offshore documents, but that’s only one of the tools we have available for gathering information. Taxpayers with offshore assets who underreported their income should come forward before we come looking for them.”
The Tax Division aggressively pursues offshore tax evasion. More information is available online about the Division’s Offshore Compliance Initiative and its Swiss Bank Program.
22 Defendants Named in Health Care Fraud Cases involving over $161 Million in Fraudulent Bills to Government Health Care ProgramsRead the Press Release
LOS ANGELES – Culminating investigations by a host of state and federal law enforcement agencies, federal prosecutors have brought 13 criminal cases that charge a total of 22 defendants in health care fraud schemes. Several medical professionals were charged as part of the sweep, including five physicians, a psychiatrist, one pharmacist and an occupational therapist. The cases announced today allege various schemes that led to more than $161 million in fraudulent bills being submitted to publicly funded health care programs such as Medicare and TRICARE.
The cases filed in federal court in Los Angeles and Santa Ana are part of a nationwide sweep announced today in Washington by Attorney General Loretta Lynch, who said criminal and civil charges have been filed against 301 individuals who allegedly participated in health care fraud schemes involving approximately $900 million in false billings. The local cases were filed by Assistant United States Attorneys and Trial Attorneys with the Justice Department’s Medicare Fraud Strike Force.
“Health care fraud is a serious offense that costs Americans billions of dollars, and the cases announced today here in Los Angeles alone cost taxpayers more than $100 million,” said United States Attorney Eileen M. Decker. “These crimes affect real people and erode the trust that should exist between a patient and their health care provider. The entire Justice Department and our law enforcement partners are committed and determined to doing everything it takes to ensure the health care system works for the American public – and not those, whether health care providers or others, who seek to abuse the system.”
The cases filed in the Southland involve actual losses of more than $125 million, with the bulk of those losses associated with five cases related to schemes involving compounding pharmacies. In schemes orchestrated by marketers (sometimes called “cappers”), compounding pharmacies were provided with large numbers of prescriptions, generally for pain medications, that carried huge reimbursements, often more than $15,000 for each prescription. The prescriptions were written by doctors who received kickbacks from marketers or from “telemedicine” websites that had little or no contact with patients. The prescriptions were written for “patients” who, in many cases, did not want the prescriptions, had never met the prescribing doctors or had no idea why they were receiving the medications. In many cases, the beneficiary information was being used without the knowledge of the “patients” until the prescriptions showed up at their homes.
TRICARE, the military’s managed care program, was the primary victim of schemes involving the compounding pharmacies. Over the course of just a few years, TRICARE paid hundreds of millions of dollars for medications dispensed to “patients” across the nation, typically creams that supposedly would treat minor pain, scars, erectile dysfunction or “general wellness.” Five of the cases announced today relate to compounding pharmacies and allege losses of more than $100 million, most of which was paid by TRICARE over the course of just a few months.
In one case, John Garbino, a marketer who resides in Dana Point, was charged with receiving illegal kickbacks after referring prescriptions to compounding pharmacies that filled the prescriptions and billed TRICARE. One Palmdale pharmacy allegedly received more than $46 million from TRICARE in only six months. Another pharmacy in Corona received nearly $6 million over the same six-month period. Garbino allegedly received illegal kickbacks of as much as 65 percent for referring prescriptions to the compounding pharmacies. The criminal complaint against Garbino alleges that one of the pharmacies dramatically increased its claims to TRICARE “for filling compounded medications prescriptions that had been specially formulated to achieve the highest possible reimbursement rates rather than the greatest medical efficacy.”
In another scheme, the Florida-based operator of a “telemedicine” website was charged with health care fraud for allegedly misusing the identity and medical credentials of a physician to submit prescriptions to a compounding pharmacy. The criminal complaint in this case alleges that two local pharmacies received more than $6.5 million in payments from TRICARE in 2015.
In a third case, the owner of a La Mirada pharmacy, two marketers and a doctor were indicted on charges of paying and receiving illegal kickbacks. Health insurers paid the pharmacy, Valley View Drugs, more than $20 million, and the pharmacy paid nearly half of that to companies associated with the marketers.
“The Defense Criminal Investigative Service, in partnership with our fellow federal investigative agencies, will continue to uncompromisingly investigate and bring to justice the people who perpetrate these criminal acts,” said Special Agent in Charge Chris Hendrickson, DCIS Western Field Office. “Their actions threaten to cripple our vital national health care industry, and place our citizenry at risk. Over $100 million in Department of Defense health care funds that should have been used to treat the military and their families was instead allegedly stolen by swindlers. We will remain vigilant.”
“These arrests demonstrate that the U.S. Government will not tolerate fraud in the compounding pharmacy industry,” said Norbert E. Vint, the Acting Inspector General for the Office of Personnel Management, Office of Inspector General. “We appreciate the efforts of all the investigating agencies and the Department of Justice that have held these individuals accountable for their actions, and thereby protected taxpayer funded health care programs, including the Federal Employees Health Benefits Program.”
“The United States Postal Service, Office of Inspector General, along with our law enforcement partners will aggressively investigate those who engage in fraudulent activities intended to defraud federal benefit programs and the Postal Service,” said Special Agent in Charge Brian Washington, U.S. Postal Service, Office of Inspector General. “This week’s arrests should send a clear message to all health care providers that health care fraud is a federal crime that carries serious consequences and will not be tolerated.”
“Patients were pawns in an alleged pay-for-play fraud scheme,” said California Insurance Commissioner Dave Jones. “Patients should be able to trust that medications prescribed for them are based on their healthcare needs, not on payoffs and kickbacks to physicians and pharmacists.”
In other cases announced today, a doctor who had offices in Temecula and Mira Loma allegedly submitted nearly $12 million in fraudulent bills to Medicare for unnecessary “vein ablation” surgery. Another doctor was charged for helping the owner of a Granada Hills medical clinic, who recruited Medicare patients with promises of free equipment and used their beneficiary information to bill for services that simply were never provided.
“Medical professionals who seek to enrich themselves through Medicare fraud – such as exchanging illegal kickbacks or billing for medically unnecessary procedures – undermine this taxpayer-funded program and drive up health care costs for everyone,” said Special Agent in Charge Chris Schrank, of the U.S. Department of Health and Human Services, Office of Inspector General. “Today’s announcement shows our commitment to working with our state and federal law enforcement partners to swiftly investigate such allegations of fraud.”
Another case announced today charges three defendants in a scheme to defraud the health benefit plans established for members of the International Longshore and Warehouse Union and Federal Express employees. Participants in the scheme allegedly paid beneficiaries of those plans to undergo unnecessary sleep and nerve conduction velocity studies that were then billed to the plans. The defendants operated facilities in Sherman Oaks and San Pedro, where the testing was conducted as part of the fraud scheme that submitted at least $16 million in bills to the union and FedEx health plans. The defendants in this case also face money laundering charges.
“Those who commit fraud targeting health care funding get rich on the backs of American taxpayers who watch their premiums go up,” said Deirdre Fike, Assistant Director in Charge of the FBI’s Los Angeles Field Office. “Anyone who identifies suspicious billing practices or unlawful activity by a provider should contact a member of the Strike Force.”
“In the coming years, we will continue to leverage our financial skill set and focus on investigating those whose criminal activity drives up medical costs and jeopardizes a system that our citizens have come to trust,” stated IRS Criminal Investigation’s Acting Special Agent in Charge Anthony J. Orlando. “We will continue to work with our federal and state law enforcement partners to bring to justice those individuals who prey on the nation's health care system for their own personal greed.”
Most of the 22 defendants named in the cases were arrested on Monday and Tuesday. Several defendants self-surrendered after learning of the federal charges. A separate announcement details all 13 cases and the defendants charged in those cases.
Indictments and criminal information contain allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.
The cases announced this week in Los Angeles are the result of investigations conducted by the United States Department of Health and Human Services, Office of Inspector General; the Defense Criminal Investigative Service; the Federal Bureau of Investigation; the Office of Personnel Management, Office of Inspector General; the Veterans Administration, Office of the Inspector General; the Department of Labor, Employee Benefits Security Administration; the California Department of Insurance, Fraud Division; the United States Postal Service, Office of the Inspector General; Amtrak’s Office of the Inspector General; the California Board of Pharmacy; IRS Criminal Investigation; and the California Department of Justice.
22 Charged in SDTX as Part of Largest National Medicare Fraud Takedown in HistoryRead the Press Release
HOUSTON – Attorney General Loretta E. Lynch and Department of Health and Human Services (DHHS) Secretary Sylvia Mathews Burwell announced today an unprecedented nationwide sweep led by the Medicare Fraud Strike Force in 36 federal districts, resulting in criminal and civil charges against 301 individuals, including 61 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $900 million in false billings. Twenty-three state Medicaid Fraud Control Units also participated in today’s arrests. In addition, the HHS Centers for Medicare & Medicaid Services (CMS) is suspending payment to a number of providers using its suspension authority provided in the Affordable Care Act. This coordinated takedown is the largest in history, both in terms of the number of defendants charged and loss amount. “As this takedown should make clear, health care fraud is not an abstract violation or benign offense – It is a serious crime,” said Lynch. “The wrongdoers that we pursue in these operations seek to use public funds for private enrichment. They target real people – many of them in need of significant medical care. They promise effective cures and therapies, but they provide none. Above all, they abuse basic bonds of trust – between doctor and patient; between pharmacist and doctor; between taxpayer and government – and pervert them to their own ends. The Department of Justice is determined to continue working to ensure that the American people know that their health care system works for them – and them alone.” “The largest multiple defendant takedown of those who were involved in large scale health care fraud against the USA sends a tremendous message to the public of our vigilance. Such wrongdoing will be uncovered and prosecuted,” said U.S. Attorney Kenneth Magidson. “These cases are part of our continuing effort to combat greed in our health care system, not only in the Houston metropolitan area, but also in our other offices in South Texas. We are committed to a sustained effort to continue to root out health care fraud.” In the Southern District of Texas (SDTX), the United States Attorney’s Office (USAO) and the Department of Justice Medicare Fraud Strike Force charged 22 individuals in 11 cases involving over $136 million in alleged fraud. One of these defendants is a physician with the highest number of referrals to home health services in the SDTX. Houston physician John Ramirez, 62, has been charged with participating in separate schemes to bill Medicare for medically unnecessary home health services that were often not provided. He is charged with four counts of conspiracy to commit health care fraud. In this $18 million Medicare fraud scheme, Ramirez allegedly authorized home-health services for Medicare beneficiaries when such services were not medically necessary, not provided by the home health agency or both. Medicare paid over $15 million to numerous companies that submitted claims to Medicare using the fraudulent home health referrals from the physician, according to the indictment. Also charged in this case is Susana Bermudez, 49, of Houston, the owner of Milten Clinic in Houston. She was indicted on one count of conspiracy to commit health care fraud for allegedly selling signed certifications to home health agencies. The agencies then would bill Medicare for purported home health services that were medically unnecessary, not provided, or both. In a separate but related case, Ramirez, Ann Sheperd, 60, of Houston, and Yvette Nwoko, 27, of Houston, were indicted on one count of conspiracy to commit health care fraud and three counts of health care fraud. The charges stem from their alleged roles in an $20 million Medicare fraud scheme. Sheperd was the owner and operator of Amex Medical, while Nwoko was the manager. The indictment alleges Shepherd and Nwoko would make it appear as if Medicare beneficiaries qualified for home health services when, in fact, the beneficiaries did not need the services. Shepherd allegedly paid doctors to sign false certifications. In return, Shepherd and Nwoko would sell the certifications to home health agencies, according to the charges. These agencies would then bill Medicare for home health services that were not necessary, not provided, or both. These cases are being jointly prosecuted by the USAO and the Strike Force. In another case prosecuted by the USAO, Gwendolyn Arnetta Gibbs aka Gwendolyn Arnetta Guidry, 64, of Missouri City, and Justina Obumnador Uzowulu, 55, are charged in a 20-count indictment for their participation in a $15 million health care fraud conspiracy. Gibbs is the owner and operator of Daybreak Rehabilitation Center. The indictment alleges he paid kickbacks to Uzowulu, who operates a group home in Houston, who would then bring her residents to Gibbs’ partial hospitalization program for group therapy. Gibbs could then bill Medicare for treatment, according to the indictment. Gibbs is also charged with billing group therapy sessions under a doctor who no longer worked at Daybreak. In McAllen, the owner of a Rio Grande Valley area durable medical equipment (DME) company and six others have been charged in a 16-count indictment for allegedly submitting false and fraudulent claims to Texas Medicaid for DME equipment that was not provided and/or was not authorized by a physician. Maria Garza, 41, of McAllen, is an owner of DME company Hacienda DME. Also charged were employees Bertha Lopez, 61, of Sullivan City, who served as a marketer and vendor for the company; Miriam Aguilar, 31, of Rio Grande City, a delivery driver and recruiter; and Nancy Rangel, 30, of Mission, who was a biller and recruiter. Veronica Cruz, 32, of Donna, Angelica Saenz, 44, of Mission, and Yolotzi Lara, 28, of Penitas, were charged for their roles as recruiters for Hacienda DME. According to the indictment, the defendants forged and/or caused others to forge the signatures of physicians on the required prescription forms. They also allegedly billed for larger, higher-paying sizes of pull-ups and diapers regardless of whether those sizes were needed or provided in order to receive higher reimbursements from Texas Medicaid. Further, the defendants also paid illegal kickbacks in exchange for patient information, according to the indictment. Additionally, the Strike Force has returned seven additional indictments and informations in the SDTX, charging nine more defendants in cases involving over $80 million. The operations announced today are part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations and since its inception in March 2007 has charged over 2,900 defendants who collectively have falsely billed the Medicare program for over $8.9 billion. Including today’s enforcement actions, nearly 1,200 individuals have been charged in national takedown operations, which have involved more than $3.4 billion in fraudulent billings. Today’s announcement marks the second time that districts outside of Strike Force locations participated in a national takedown, and they accounted for 82 defendants charged in this takedown. The cases announced today are being prosecuted and investigated by U.S. Attorney’s Offices nationwide, along with Medicare Fraud Strike Force teams from the Criminal Division’s Fraud Section and from the U.S. Attorney’s Offices of the Southern District of Florida, Eastern District of Michigan, Eastern District of New York, Southern District of Texas, Central District of California, Eastern District of Louisiana, Northern District of Texas, Northern District of Illinois and the Middle District of Florida; and agents from the FBI, DHHS-Office of Ispector General, Drug Enforcement Administration, Defense Criminal Investigative Service and state Medicaid Fraud Control Units. The court documents for each case will posted online, as they become available, here: https://www.justice.gov/opa/documents-and-resources-june-22-2016-medicare-fraud-strike-force-press-conference. An indictment or information is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law. ###100 Charged in Southern District of Florida as Part of Largest National Health Care Fraud Takedown in HistoryRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Attorney General Loretta E. Lynch, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Shimon R. Richmond, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), Norbert E. Vint, Acting Inspector General, U.S. Office of Personnel Management, Office of Inspector General (OPM-OIG), Pam Bondi, Florida Attorney General, George M. Karavetsos, Director, U.S. Food and Drug Administration’s (FDA) Office of Criminal Investigations (OCI), John F. Khin, Special Agent in Charge, Defense Criminal Investigative Service (DCIS) Southeast Field Office, Max Eamiguel, Special Agent in Charge, U.S. Postal Service, Office of Inspector General (USPS-OIG), Robert C. Hutchinson, Acting Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), Miami Field Office, Diane J. Sabatino, Director, Field Operations, U.S. Customs and Border Protection (CBP), and Frank Robey, Director, U.S. Army Criminal Investigative Command’s, Major Procurement Fraud Unit, announce that 100 South Florida residents were charged for their alleged participation in various schemes to defraud Medicare and Medicaid out of approximately $220 million. The charges in South Florida are part of a nationwide takedown by Medicare Fraud Strike Force operations in 36 federal districts that resulted in charges against 301 individuals, including 61 doctors, nurses, and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $900 million in false billings. In addition, the HHS Centers for Medicare & Medicaid Services (CMS) also suspended a number of providers using its suspension authority as provided in the Affordable Care Act. This coordinated takedown is the largest in the history of the Medicare Fraud Strike Force.
The defendants announced today are charged with various health care fraud-related crimes, including conspiracy to commit health care fraud, violations of the anti-kickback statutes, money laundering and aggravated identity theft. The charges are based on a variety of alleged fraud schemes involving various medical treatments and services, including home health care, psychotherapy, physical and occupational therapy and prescription drugs. Approximately 28 South Florida defendants are charged with fraud related to the Medicare prescription drug benefit program known as Part D, which is the fastest-growing component of the Medicare program overall.
U.S. Attorney Wifredo A. Ferrer stated, “The United States Attorney’s Office for the Southern District of Florida remains relentless in combating health care fraud. The takedown announced today is the largest in the history of the Southern District of Florida in terms of the number of defendants charged. It also demonstrates that we continue to prosecute every link in the health care fraud chain - from the pharmacy or home health agency owner that submits false claims to the Medicare beneficiaries who decide to abuse their health care privileges by accepting kickbacks from patient recruiters, to the medical professionals whose judgment becomes compromised by the payment and receipt of kickbacks, we will find them and bring them to justice. I thank our federal, state and local law enforcement partners who with our Office stand committed to find, stop and punish those who steal from a program that provides the security of health care to the most needy in our society.”
“As this takedown should make clear, health care fraud is not an abstract violation or benign offense – It is a serious crime,” said Attorney General Lynch. “The wrongdoers that we pursue in these operations seek to use public funds for private enrichment. They target real people – many of them in need of significant medical care. They promise effective cures and therapies, but they provide none. Above all, they abuse basic bonds of trust – between doctor and patient; between pharmacist and doctor; between taxpayer and government – and pervert them to their own ends. The Department of Justice is determined to continue working to ensure that the American people know that their health care system works for them – and them alone.”
According to court documents, the defendants allegedly participated in schemes to submit claims to Medicare and Medicaid for treatments that were medically unnecessary and often never provided. In many cases, patient recruiters, Medicare beneficiaries and other co-conspirators were allegedly paid cash kickbacks in return for supplying beneficiary information to providers, so that the providers could then submit fraudulent bills to Medicare for services that were medically unnecessary or never performed. Collectively, the doctors, nurses, licensed medical professionals, health care company owners and others charged are accused of conspiring to submit a total of approximately $900 million in fraudulent billing.
“Health care providers and patients are key to protecting the Medicare and Medicaid programs, but when they instead choose to commit fraud and engage in widespread kickback schemes, they steal precious tax dollars and corrupt the integrity of our health care system,” said Special Agent in Charge Shimon R. Richmond of the U.S. Department of Health & Human Services Office of Inspector General (OIG). “This takedown reflects the dedication of OIG and our law enforcement partners to bring such fraudsters to justice.”
Acting Inspector General Norbert E. Vint stated, “Today’s arrests demonstrate that the U.S. Government will not tolerate fraud in the compounding pharmacy industry. We appreciate the efforts of all the investigating agencies and the Department of Justice that have held these individuals accountable for their actions, and thereby protected taxpayer funded health care programs, including the Federal Employees Health Benefits Program.”
Florida Attorney General Pam Bondi stated, “With this historic fraud takedown we are sending the message to anyone scheming to steal from our Medicaid and Medicare programs that we will find them and they will be held accountable. Thanks to the joint efforts of my Medicaid Fraud Control Unit and our federal partners, this takedown has stopped millions of dollars in potential future fraud and will ensure those responsible are held to account.”
“Healthcare providers who dispense prescription drugs that are medically unnecessary put patients’ health at risk,” said George M. Karavetsos, Director, FDA Office of Criminal Investigations. “The FDA will continue to pursue those who perpetrate fraudulent schemes that target the health and safety of consumers.”
“These arrests demonstrate an unrelenting effort by the Defense Criminal Investigative Service (DCIS) and its law enforcement partners to protect the integrity of the Department of Defense (DoD) health care program,” said Special Agent in Charge John F. Khin, Southeast Field Office. “Fraud and abuse by pharmacies, marketing entities, and medical providers involved in fraudulent compounded drug prescriptions is a significant threat to the DoD health care system. DCIS will fully pursue both criminal and civil remedies to recover taxpayer dollars and bring justice to violators who target American service members, veterans, and their families.”
“These arrests should send a clear message to all pharmacies that FEHB fraud is a federal crime that carries serious consequences and will not be tolerated,” said Special Agent in Charge Max Eamiguel, U.S. Postal Service, Office of Inspector General (USPS-OIG.) “We along with our law enforcement partners will continue to aggressively investigate those who engage in fraudulent activities intended to defraud federal benefit programs and the Postal Service.”
“We utilize our extensive financial and money laundering investigative authorities to combat fraud throughout our economy, especially in areas such as identity theft and health care fraud,” said Robert C. Hutchinson, Acting Special Agent in Charge of HSI Miami. “Due to the importance of the health care sector, these investigations are particularly critical for our nation.”
“U.S. Customs and Border Protection is committed to fighting fraud by providing unparalleled support to an ever-expanding network of law enforcement partners across Florida,” said Diane J. Sabatino, Director Field Operations for Miami/Tampa Field Offices. “CBP enforces more than 400 laws and regulations for 40 different agencies and will continue to work alongside local, state, and federal government partners every day to protect the public.”
“We are very pleased with the results of this complex and lengthy investigation and today’s announcement is a textbook example of seamless interagency law enforcement cooperation and teamwork,” said Frank Robey, Director of the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit. “Our agency stands ready and able to fully investigate allegations of this nature that impact DOD and the American taxpayers.”
In the Southern District of Florida, a total of 100 defendants were charged with offenses relating to their participation in various fraud schemes involving approximately $220 million in false billings for home health care, mental health services and pharmacy fraud. Below are some of the cases included in the takedown:
A. MEDICARE PART D
1. United States v. Edgardo Lobo, et al., Case No. 16-20334-CR-Lenard
Edgardo Lobo, 50, of Miami, the owner or operator of Oshun Pharmacy, Lycan Services, Accalia Crative and Formula Pharmaceuticals; Ileana Calvo, 51, of Miami, the president of Universal Healthcare; and Juan Carlos Acosta, 53, of Hialeah, president of Pharmmed Delivery, were charged with one count of conspiracy to commit health care fraud, one count of conspiracy to pay and receive health care kickbacks, and one count conspiracy to commit money laundering. Additionally, Edgardo Lobo was charged with five counts of health care fraud, and seven counts of money laundering; Ileana Calvo was charged with two counts of money laundering; and Juan Carlos Acosta was charged with three counts of money laundering. The charges stem from the defendants’ role in a $4.8 million pharmacy fraud scheme.
Mr. Ferrer commended the investigative efforts of FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Lisa Miller of the Criminal Division’s Fraud Section.
2. United States v. Nereida Montejo, et al, Case No. 16-20400-CR-Scola
Nereida Montejo, 65, of Miami, owner and operator, Nerta Rodriguez, 73, of Miami, operator, and Carlos Hernandez, 64, of Miami, patient recruiter, all for New Pharmacy Discount, Corp., were charged with one count of conspiracy to defraud the United States and to pay and receive health care kickbacks. Montejo and Rodriguez were additionally charged with one count of conspiracy to commit health care fraud and wire fraud. Montejo was also charged with nine counts of health care fraud, and four counts of payment of kickbacks in connection with a federal health care program. The charges stem from each defendants’ alleged role in a $5.2 million scheme, whereby Montejo, as the owner and operator of New Pharmacy, paid kickbacks and bribes to patients and patient recruiters in order to bill both Medicare and Medicaid for medications that were not purchased.
Mr. Ferrer commended the investigative efforts of the FBI, HHS-OIG and the State of Florida Medicaid Fraud Control Unit. This case is being prosecuted by DOJ Attorney Stephen Cincotta of the Criminal Division’s Fraud Section.
3. United States v. Arturo Rodriguez Sr, Case No. 16-20425-CR-Lenard
Arturo Rodriguez, 69, of Miami, owner and operator of Olympia Discount, Corp. was charged with conspiracy to commit health care fraud and wire fraud, and conspiracy to defraud the United States and pay health care kickbacks. The charges stem from Rodriguez’s alleged role in a $2.6 million scheme, whereby Rodriguez, as the owner and operator of the Olympia Discount pharmacy, paid kickbacks and bribes to patients and patient recruiters in order to bill Medicare for medications that were not prescribed to patients, were not necessary, and were not purchased.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Stephen Cincotta of the Criminal Division’s Fraud Section.
4. United States v. Andy Armas, Case No. 16-20474-CR-Middlebrooks
Andy Armas, 34, of Miami, owner and operator of Millenium Pharmacy and Marlins Pharmacy, was charged with one count of conspiracy to commit health care fraud and wire fraud, four counts of health care fraud, and one count of conspiracy to defraud the United States and pay health care kickbacks. The charges stem from Armas’s role in a $5.7 million scheme, whereby Armas, as the owner and operator of Millenium and Marlins pharmacies paid kickbacks and bribes to patients and patient recruiters in order to bill Medicare for medications that were not purchased.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Stephen Cincotta of the Criminal Division’s Fraud Section.
5. United States v. Niurka Fernandez and Roberto Alvarez, Case No. 16-20391-CR-Moreno
Niurka Fernandez, 54, of Miami, and Roberto Alvarez, 29, of Sweetwater, were charged with allegations that they participated in a health care fraud conspiracy involving two pharmacies, Calan Pharmacy and Best Pharmacy, both located in Miami. According to the indictment, the scheme involved paying kickbacks to patient recruiters and Medicare beneficiaries, as well as billing Medicare for prescription drugs that were never in fact dispensed. Both defendants were charged with conspiracy to commit health care fraud and wire fraud; conspiracy to commit money laundering; and substantive counts of money laundering. Additionally, Fernandez was charged with five substantive counts of health care fraud. In total, the indictment alleges a loss of over $16 million.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Trial Attorney L. Rush Atkinson of the Criminal Division’s Fraud Section.
6. United States v. Reinaldo Morey, et al., Case No. 16-20460-CR-Cooke
Reinaldo Morey, 50, and Niurka De La Caridad Morey, 50, both of Miami, were charged with conspiracy to commit health care fraud and health care fraud for using their pharmacy, Dalice Medical Equipment to bill Medicare for prescriptions that were never dispensed to the patients. The loss to Medicare was over $3.4 million.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Elizabeth Young of the Criminal Division’s Fraud Section
7. United States v. Carlos Cardenas, Case No. 16-20480-CR-Gayles
Carlos Cardenas, 47, of Miami, a pharmacy owner, was charged with health care fraud. The charges stem from Cardenas using his pharmacy, Nuestra Pharmacy, to bill Medicare for $730,000 in prescriptions that were never dispensed.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Elizabeth Young of the Criminal Division’s Fraud Section.
8. United States v. Marlenis Fernandez, Case No. 16-20486-CR-Moore
Marlenis Fernandez, 51, of Miami, owner of United Care Pharmacy, was charged with conspiracy to commit health care fraud. The charges stem from Fernandez’s alleged role in a scheme to defraud Part D of the Medicare program by billing for more than $900,000 of prescription drugs that were never purchased, never provided and were not medically necessary. As a result of the scheme, Medicare paid over $900,000 in fraudulent claims.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Timothy P. Loper of the Criminal Division’s Fraud Section.
9. United States v. Gabriela Alegria, Case No. 16-20485-CR-Lenard
Gabriela Alegria, 43, of Miami, owner of GAC Investor Corporation, was charged with conspiracy to commit money laundering. The charges stem from Alegria’s alleged involvement in a scheme in which the defendant established and maintained signature authority on business accounts that she used to launder over $700,000 in proceeds from a Medicare fraud scheme.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Timothy P. Loper of the Criminal Division’s Fraud Section.
10. United States v. Anet Martinez Gonzalez, Case No. 16-20450-CR-Scola
Anet Martinez Gonzalez, 43, of Dania, was charged with conspiracy to commit health care fraud and wire fraud. The Information alleges that Gonzalez was the manager of Calle Ocho Pharmacy in Miami. The Information further alleges that Gonzalez submitted and caused the submission of false and fraudulent claims to Medicare and Medicare drug plan sponsors for prescription drugs that were not actually provided to Medicare beneficiaries. As a result of these false and fraudulent claims, Medicare drug plan sponsors made payments funded by Medicare in the approximate amount of $273,757.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney Daniel Bernstein.
11. United States v. Jose Nunez, Case No. 16-20458-CR-Scola
Jose Nunez, 64, of Miami, was charged with conspiracy to commit money laundering, money laundering, and witness tampering. The Indictment alleges that Nunez laundered approximately $196,500 in health care proceeds drawn from corporate accounts belonging to La Esperanza Pharmacy Discount, Inc. The Indictment further alleges that Nunez knowingly attempted to and engaged in witness tampering by directing an individual to falsely state that the monies provided to him were a loan for the purchase of certain real estate, with the intent to hinder and prevent the communication to federal agents of the United States Department of Health and Human Services, Office of Inspector General, and the FBI, rather than illegal proceeds from health care fraud.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney Christopher Clark.
12. United States v. Roslane Pichs, et al., Case No. 16-20479-CR-Ungaro
Roslane Pichs, 41, Daniel Pichs Gonzalez, 64, and Raquel Castro, 63, all of Miami, were charged with conspiracy to commit health care fraud and wire fraud. Pichs and Gonzalez were also charged with six counts of substantive health care fraud. The Indictment alleges that Pichs, Gonzalez, and Castro submitted and caused the submission of fraudulent claims, via interstate wire, that falsely represented that various health care benefits, primarily prescription drugs, were medically necessary, prescribed by a doctor, and had been provided to Medicare beneficiaries by the defendants’ businesses, Mazal Tov Pharmacy, Inc. and Angel’s Light Pharmacy & Discount. As a result of such false and fraudulent claims, Medicare prescription drug plan sponsors made payments funded by the Medicare Part D Program to the corporate bank accounts controlled by the three defendants in the approximate amount of $7,709,636.
Mr. Ferrer commended the investigation efforts of HHS-OIG and ICE-HSI. This case is being prosecuted by Assistant U.S. Attorney Roger Cruz.
13. United States v. Alexis Avila, et al., Case No. 16-20471-CR-Altonaga
Alexis Avila, 39, Raiza Ruiz, 43, and Yis Fernandez, 36, all of Hialeah, were charged with conspiracy to commit health care fraud. The Information alleges that Avila, Ruiz, and Fernandez submitted and caused the submission of claims, via interstate wire, which falsely and fraudulently represented that various health care benefits, primarily prescription drugs, were medically necessary, prescribed by a doctor, and had been provided by La Esperanza Pharmacy Discount, Inc., in Hialeah, to Medicare beneficiaries. La Esperanza was purportedly a pharmacy that provided Medicare beneficiaries with various pharmaceutical items and services. As a result of such false and fraudulent claims, Medicare prescription drug plan sponsors, made payments funded by the Medicare Part D Program to the corporate bank accounts of La Esperanza in the approximate amount of $6,747,469.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney Christopher Clark.
14. United States v. Dora Josefa Robaina, Case No. 16-20490-CR-Bloom
Dora Josefa Robaina, 48, of North Bay Village, was charged with failure to appear, in violation of Title 18, United States Code, Section 3146. In the case of United States v. Dora Josefa Robaina, Case No. 15-20799-CR-Middlebrooks, the defendant was previously sentenced to thirty three months in prison after she pled guilty to accessory after the fact in connection with her role in deceiving federal agents who attempted to arrest Antonio Hevia and Pedro Torres, two defendants who were involved in the submission of $16.7 in false claims to Medicare. At the sentencing hearing, Robaina was ordered to surrender to the Bureau of Prisons on June 10, 2016 and she failed to do so.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being handled by Assistant U.S. Attorney James Hayes.
B. HOME HEALTH
15. United States v. Daylin Cabrera, et al, Case No. 16-20476-CR-Zloch
Daylin Cabrera, 33, the owner of a fraudulent physical therapy staffing company; Raciel Leon, 42, the office manager of a fraudulent home health care company; and Alex Lopez Huergo, 37, all of Miami, the owner of a fraudulent home health care company were charged with conspiracy to commit health care fraud and one count of conspiracy to pay and receive kickbacks. Additionally, Cabrera was charged with two counts of health care fraud. The charges stem from their role in a $2.5 million home health care fraud scheme.
Mr. Ferrer commended the investigative efforts of FBI and HHS-OIG. This case is being prosecuted DOJ Attorneys Lisa Miller and Elizabeth Young of the Criminal Division’s Fraud Section.
16. United States v. Jose Avila, M.D. and Michael Bahrami, M.D., Case No. 16-20471-CR-Altonaga
Jose Avila, 58, of Hallandale, and Michael Bahrami, 60, of Golden Beach, two medical doctors, were charged with conspiracy to defraud the United States and receive health care kickbacks. Avila was also charged with one count of receiving health care kickbacks. The charges stem from their involvement in a $57 million home health fraud scheme involving paying kickbacks to doctors and patient recruiters, and billing for services that were not necessary and/or not provided. Avila was previously charged by Complaint with receiving kickbacks in connection with a federal health care program.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Vasanth Sridharan of the Criminal Division’s Fraud Section.
17. United States v. Cynthia Vilches, Case No. 16-20466-CR-Moore
Cynthia Vilches, 47, of Miramar, owner of Healthy Choice Home Health, was charged with one count of conspiracy to commit health care fraud. The charge arises from Vilches’ role in a $56 million home health fraud scheme involving paying kickbacks to doctors and patient recruiters, and billing for services that were not necessary and/or not provided.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Vasanth Sridharan of the Criminal Division’s Fraud Section.
18. United States v. Reidy Gonzalez, et al., Case No. 16-20464-CR-Zloch
Reidy Gonzalez, 43, and Yelina Isabel Gonzalez, 44, both of Miami, were charged with one count of conspiracy to defraud the United States and pay health care kickbacks. The charges stem from allegations that both defendants, who owned and controlled Dade-Kendall Home Healthcare Services, Inc., a home health agency in Miami, paid kickbacks to a patient recruiter in exchange for patients and billed Medicare for those patients.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Trial Attorney L. Rush Atkinson of the Criminal Division’s Fraud Section.
19. United States v. Mildrey Gonzalez, et al., Case No. 16-20461-CR-Martinez
Mildrey De La Caridad Gonzalez, 61, of Miami Beach, Milka Yarlin Alfaro, 39, of Miami Beach, Adriana Damas Jalil, 38, of Miami, and Luis Enrique Luzardo, 47, of Miami, were indicted on charges stemming from their respective roles in a scheme to defraud Medicare resulting in losses over $24 million. The alleged scheme involved six home health agencies in the greater Miami area, all of which are alleged in the Indictment to have been owned and controlled by Gonzalez and Alfaro. Gonzalez and Alfaro were charged with one count of conspiracy to commit health care fraud and wire fraud; seven counts of health care fraud; conspiracy to defraud the United States and pay and receive kickbacks in connection with a federal health care benefit program; conspiracy to commit money laundering, and substantive counts of money laundering. Jalil was charged with one count of conspiracy to defraud the United States and pay and receive kickbacks in connection with a federal health care benefit program and three substantive counts of receiving kickbacks in in connection with a federal health care benefit program. Luzardo was charged with one count of conspiracy to commit money laundering and two substantive counts of money laundering.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Trial Attorney L. Rush Atkinson of the Criminal Division’s Fraud Section.
20. United States v. Noemi Rodriguez, Case No. 16-20413-CR-Moreno
Noemi Rodriguez, 52, of Hialeah, President and Operator of US Care Network, Inc., was charged with conspiracy to defraud the United States and to solicit and receive kickbacks and four counts of soliciting and receiving kickbacks. The charges arise from Rodriguez’s alleged involvement in recruiting patients and providing prescriptions for home health agencies in exchange for kickbacks.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Katherine Payerle of the Criminal Division’s Fraud Section.
21. United States v. Armando Salazar, Case No. 16-20379-CR-Moreno
Armando Salazar, 65, of Miami, President and Director of Monzon Medical Diagnostic Corp., was charged with conspiracy to defraud the United States and receive health care kickbacks, receiving kickbacks in connection with a federal health care program, and three counts of health care fraud. The charges arise from Salazar’s alleged role in a $1.4 million scheme involving kickback payments for home health prescriptions.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Katherine Payerle of the Criminal Division’s Fraud Section.
22. United States v. Joanna Carpio and Leonie Dorce, Case No. 16-20412-CR-Gayles
Joanna Carpio, 25, of Miami, clinic office manager, and Leonie Dorce, 71, of Miami Lakes, Advanced Registered Nurse Practitioner, at City Center Rehab Corp., were charged with conspiracy to commit health care fraud. Carpio was also charged with conspiracy to defraud the United States and receive health care kickbacks. The charges arise from Carpio and Dorce’s alleged role in a more than $36 million scheme involving payment of kickbacks for prescriptions and referrals for home health care and other medical services.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Katherine Payerle of the Criminal Division’s Fraud Section.
23. United States v. Francisco Correa Delgado, Case No. 16-20482-CR-Moreno
Francisco Correa Delgado, 46, of Hialeah, President and Director of the home health agency, H&E Home Care, Inc., was charged with four counts of health care fraud for his role in a $3.1 million scheme. The charges arise from Delgado’s ownership of a home health agency that billed Medicare for home health services that were never prescribed by a licensed physician or provided to Medicare beneficiaries.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Katherine Payerle of the Criminal Division’s Fraud Section.
24. United States v. Dagoberto Morales, Case No. 16-20414-CR-Altonaga
Dagoberto Morales, 36, of Hialeah, President and Director of the home health agency, Samy Nursing Corp., Inc., was charged with four counts of health care fraud for his role in a $6 million scheme. The charges arise from Morales’ ownership of a home health agency that allegedly billed Medicare for home health services that were never prescribed by a licensed physician or provided to Medicare beneficiaries.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Angela Adams of the Criminal Division’s Fraud Section.
25. United States v. Dayami Martinez and Yadira Robertson, Case No. 16-20431-CR-Cooke
Dayami Martinez, 41, of Miami, Director of Nursing for two home health agencies, and Yadira Robertson, 55, of Miramar, physical therapy assistant working for a therapy staffing company, were charged with conspiracy to commit health care fraud and wire fraud. Martinez was also charged with two counts of false statements in connection with a federal health care program, and Robertson was charged with 10 counts of that crime. The charges arise from their involvement in an $830,000 fraud scheme between the therapy staffing company, R.C. Therapy, and two home health agencies, Maya Home Health and Floridian Home Health.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Vasanth Sridharan of the Criminal Division’s Fraud Section.
26. United States v. Elvis Hernandez, Case No. 16-20415-CR-Moore
Elvis Hernandez, 43, of Hialeah, President and Director of the home health agency, Global Nursing Association, Inc., was charged with three counts of health care fraud for his role in a $3.5 million scheme. The charges arise from Hernandez’s ownership of a home health agency that allegedly billed Medicare for home health services that were never prescribed by a licensed physician or provided to Medicare beneficiaries.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Angela Adams of the Criminal Division’s Fraud Section.
27. United States v. Pavel Aguila, et al., Case No. 16-20478-CR-Williams
Pavel Aguila, 42, of Miami, Laura Perez, 48, of Miami, and Emilio Enriquez, 53, of Florida City, were charged with conspiracy to defraud the United States and substantive counts of receiving kickbacks in connection with a federal health care program. The indictment alleges that Aguila, Perez, and Enriquez were patient recruiters who accepted kickbacks in return for referring Medicare beneficiaries to Casper Home Health, a Miami-Dade based home health agency
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney Kevin Larsen.
28. United States v. Carlos F. Valencia, et al., Case No. 16-20462-CR-Moreno
Carlos F. Valencia, 45, of Miami Lakes, Rosa M. Cabrera, 58, of Hialeah, Reynaldo Cubilla, 64, of Miami, Josefina Caridad Fornells, 77, of Miami, Epifania Gonzalez, 76, of Miami, Francisco Emilio Hernandez, 83, of Miami, Evelio Linares, 82, of Miami, Zoila Miranda, 59, of Miami, Jacinto Margarito Montenegro, 84, of Miami, Francisco Oramas, 82, of Miami, and Electo Pena, 65, of Miami, were charged with conspiracy to pay and receive health care kickbacks and substantive counts of paying and receiving kickbacks. The Indictment alleges that Valencia was the owner of D’Val home health agency, a company that purportedly provided skilled nursing services to homebound Medicare beneficiaries. The Indictment alleges that Valencia paid kickbacks to patient recruiters who referred Medicare beneficiaries. The Indictment further alleges that Medicare beneficiaries Hernandez, Linares, Miranda, Montenegro, Oramas, and Pena accepted kickbacks in return for agreeing to serve as patients for the home health agency. The indictment alleges that these kickbacks ranged in amounts from $760 to $1,200.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney Michael Nadler.
29. United States v. Sulman Bonilla, Case No. 16-20401-CR-Dimitrouleas
Sulman Bonilla, 46, of Miami, was charged with conspiracy to defraud the United States and pay health care kickbacks, and substantive counts of paying health care kickbacks. The Indictment alleges that Bonilla paid kickbacks to patient recruiters in exchange for the referral of Medicare beneficiaries to American Way Home Care, a Miami-Dade home health care agency. The Indictment further alleges that Bonilla caused American Way Home Care to submit claims to Medicare for services purportedly provided to the recruited beneficiaries.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney Amanda Perwin.
30. United States v. Erika Bonilla, et al., Case No. 16-20402-CR-Lenard
Erika Bonilla, 41, and Emmanuel Ventura, 48, both of Miami, were charged with conspiracy to defraud the United States and pay health care kickbacks, and substantive counts of paying health care kickbacks. The Indictment alleges that Bonilla and Ventura paid kickbacks to patient recruiters in exchange for the referral of Medicare beneficiaries to America Home Health, a Miami-Dade home health care agency. The Indictment further alleges that Bonilla and Ventura caused America Home Health to submit claims to Medicare for services purportedly provided to the recruited beneficiaries.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney Amanda Perwin.
C. COMMUNITY MENTAL HEALTH
31. United States v. Caridad Turner, Case No. 16-20443-CR-Altonaga
Caridad Turner, 43, of Miami, a clinical director of a now defunct partial hospitalization program a Greater Miami Behavioral Health, was charged with conspiracy to commit healthcare fraud. The charges stem from the defendant’s role in a $60 million scheme to defraud the federal Medicare program.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Elizabeth Young of the Criminal Division’s Fraud Section.
32. United States v. Felix Lamelas, et al., Case No. 16-20453-CR-Zloch
Felix Lamelas, 60, of Miami, Dunia Ayala, 50, of Miami, Jose Ortiz, 58, of Hialeah, Hildara Urquiola, 77, of Pembroke Pines, and Marta Maggi, 80, of Pembroke Pines, were charged for their role in recruiting patients for the now defunct partial Hospitalization program at Greater Miami Behavioral Health. All defendants were charged with conspiracy to pay and receive kickbacks in connection with a federal health care benefit program for their roles in a $60 million fraud scheme.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Elizabeth Young of the Criminal Division’s Fraud Section.
D. MEDICARE PART C (MEDICARE ADVANTAGE)
33. United States v. Ruth Aracelly Garcia, Case No. 16-20483-CR-Altonaga
Ruth Aracelly Garcia, 37, of Miami, a former office manager of Santiago Montoya, M.D., was charged with conspiracy to commit health care fraud, health care fraud, conspiracy to defraud the United States, and making false statements related to a health care matter. The Indictment alleges that Garcia and her co-conspirators recruited Medicare beneficiaries residing in Nicaragua to enroll in Medicare Advantage plans, submitted plan enrollment requests on behalf of Medicare beneficiaries that falsely and fraudulently represented that the beneficiaries resided in the plans service area within Florida, and enrolled Medicare beneficiaries residing in Nicaragua into Florida Medicaid by falsely and fraudulently representing that the beneficiaries resided in the United States.
Mr. Ferrer commended the investigative efforts of the FBI, HHS-OIG and the State of Florida Medicaid Fraud Control Unit. This case is being prosecuted by Special Assistant U.S. Attorney Hagerenesh Simmons from the Florida Attorney General Office, Medicaid Fraud Control Unit.
E. PRIVATE INSURANCE
34. United States v. Rogelio Alonso, et al., Case No. 16-20457-CR-Williams
Rogelio Alonso, 49, Mercedes Alonso, 48, and Sheneider Telfort, 32, all of Miami, were charged with conspiracy to commit health care fraud and substantive counts of health care fraud. The Indictment alleges that Rogelio Alonso, Mercedes Alonso, Sheneider Telfort, and their co-conspirators submitted and caused the submission of false and fraudulent claims to private insurance plans, via interstate wire transmission, including Blue Cross Blue Shield (“BCBS”), Cigna, AvMed, and United Health Care (“UHC”), on behalf of various medical clinics seeking approximately $10,662,813 as reimbursement for injection treatments, physical therapy treatments, and other medical items and services which were neither ordered by a physician nor provided to a beneficiary as claimed. As a result of such false and fraudulent claims, Rogelio Alonso, Mercedes Alonso, Sheneider Telfort, and their co-conspirators caused private insurance plans, including BCBS, Cigna, and UHC, to make payments to the medical clinics totaling approximately $2,253,322.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant United States Attorney Christopher Clark.
F. TRICARE
35. United States v. Celep Simsir, et al., Case No. 16-20399-CR-Gayles
Celep Simsir, 35, and Sonsoles Simsir 39, both of Jacksonville, were charged with conspiracy to commit health care fraud and mail fraud, conspiracy to pay and receive health care kickbacks, substantive counts of health care fraud and the payment and receipt of kickbacks, in connection with a conspiracy to defraud TRICARE, a United States Department of Defense health insurance programs for military personnel and their dependents. Nigal Mitchell, 25, of Jacksonville, and Andrea Rivera-Lorenzo 28, of Puerto Rico, were charged with for receiving kickbacks in return for recruiting TRICARE beneficiaries to participate in the fraudulent scheme.
The Indictment alleges that Celep Simsir and Sonsoles Simsir paid health care kickbacks to a doctor and a physician’s assistant in the Southern District of Florida in return for prescriptions for compounded medications which were not medically necessary. These medical professionals never examined or spoke with the patients. These prescriptions were then filled at a pharmacy in the Southern District of Florida which submitted approximately $25,763,938 in false and fraudulent claims. As a result of these claims, TRICARE made payments of $21,293,201 to the pharmacy.
According to detention hearing testimony, during the course of affecting the arrest of Celep Simsir and Sonsoles Simsir, federal agents allegedly seized approximately $344,000 in cash, seven firearms, including an AR-15 rifle, a Lamborghini and a Porsche. Agents also executed seizure warrants that resulted in the seizure of over $2 million.
Mr. Ferrer commended the investigative efforts of DCIS, USPIS-OIG, FDA-OCI, OPM-OIG and U.S. Army Criminal Investigative Command's, Major Procurement Fraud Unit. This case is being prosecuted by Assistant U.S. Attorneys Daniel Bernstein and Evelyn B. Sheehan.
If convicted of a charged offense, a defendant faces a possible maximum statutory sentence of five years in prison for conspiracy to defraud the United States by paying and receiving health care kickbacks, in violation of Title 18, United States Code, Section 371; five years in prison for payment and receipt of kickbacks in connection with a federal health care program, in violation of Title 42, United States Code, Section 1320a; twenty years in prison for mail or wire fraud, in violation of Title 18, United States Code, Section 1341; ten years in prison for health care fraud, in violation of Title 18, United States Code, Section 1347; twenty years for conspiracy to commit health care fraud and wire fraud, in violation of Title 18, United States Code, Section 1349; and twenty years for money laundering or conspiracy to commit money laundering, in violation of Title 18, United States Code, Section 1956.
The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations and since its inception in March 2007 has charged over 2,900 defendants who collectively have falsely billed the Medicare program for over $8.9 billion.
A complaint, information or indictment is merely a charge, and defendants are presumed innocent until proven guilty.
To learn more about HEAT, go to: www.stopmedicarefraud.gov.
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.
21 June 2016
Williston ND Man Sentenced for Receipt of Child PornographyRead the Press Release
BISMARCK - US Attorney Christopher C. Myers announced that on June 21, 2016, Steven Edward Brooks, 50, Williston ND., was sentenced before US District Judge Daniel L. Hovland to serve 14 years in prison after pleading guilty to one count of Receipt of Child Pornography. Judge Hovland also ordered that he serve 20 years of supervised release and to pay a $100 special assessment to the Crime Victims Fund. Brooks was previously employed as a Sergeant as the Williams County Correctional Center.
“It’s always extremely troubling when someone in a position of public trust is convicted of child pornography offenses, especially so in the case of Mr. Brooks who was caught with such a large amount of material,” said Alex Khu, special agent in charge of HSI St. Paul. “But HSI’s special agents are ever-vigilant and, with the help of our local and state partners, will aggressively pursue those who harm the children of our communities.”
This case came to the attention of law enforcement after an agent with the North Dakota Bureau of Investigations, assigned to the Internet Crimes Against Children Task Force (ICAC), discovered a computer geographically located in ND that was sharing child pornography in a peer-to-peer (P2P) network. A search warrant was conducted on Brooks’ electronic media and a forensic examination revealed over 190,000 still images and almost 1600 videos containing child pornography.
This case was investigated by the Department of Homeland Security - Homeland Security Investigations and the North Dakota Bureau of Criminal Investigations.
Assistant US Attorney Gary Delorme prosecuted this case as part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by U.S. Attorneys’ Offices throughout the nation, Project Safe Childhood, in conjunction with Internet Crimes Against Children Task Force (ICAC), help federal, state, and local law enforcement agencies enhance their investigative responses to offenders who use the Internet, online communications systems, or computer technology to sexually exploit children. The ICAC Program is a national network of 61 coordinated task forces engaging in proactive investigations, forensic investigations, and criminal prosecutions. Project Safe Childhood also helps to identify and rescue victims. For more information about Project Safe Childhood, please visit www.Projectsafechildhood.gov.
West Virginia man convicted, sentenced for cocaine distributionRead the Press Release
CLARKSBURG, WEST VIRGINIA– Claude Jones, 33, of Fairmont, West Virginia was convicted and sentenced today for cocaine distribution, United States Attorney William J. Ihlenfeld, II, announced.
Jones sold cocaine in the Fairmont area of Monongalia County during January 2014. Jones pled guilty today to one count of “Distribution of Cocaine within 1000 feet of a Protected Location.” He was sentenced today to 120 months in prison.
Assistant U.S. Attorney Zelda E. Wesley prosecuted the case on behalf of the government. The Mon Metro Drug Task Force investigated.
U.S. District Judge Irene M. Keeley presided.
Warren man pleads guilty to mailing white powder to former employerRead the Press Release
Anthony J. Natale, of Warren, pleaded guilty today to one count of conveying false information related to the use of a weapon of mass destruction, said Carole S. Rendon, Acting U.S. Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland Office.
Natale is scheduled to be sentenced on Sept 27.
Natale mailed an envelope containing white powder via the United States Postal Service to American Business Center, at 7677 South Avenue, Youngstown, on November 10, 2014. This was done with the intent to convey false and misleading information related to the use of a weapon of mass destruction, according to court documents.
Natale formerly worked at American Business Center. He was terminated on Oct. 6, 2014, according to court documents.
The case is being prosecuted by Assistant U.S. Attorney Justin Seabury Gould, and was investigated by the Federal Bureau of Investigation and Mahoning County Sheriff's Office.
United States Settles with Trader Joe’s to Reduce Ozone-Depleting and Greenhouse Gas Emissions at Stores NationwideRead the Press Release
The national grocery store chain Trader Joe’s Company has agreed to reduce emissions of potent greenhouse gases from refrigeration equipment at 453 of its stores under a proposed settlement with the U.S. Department of Justice and the Environmental Protection Agency (EPA) to resolve alleged violations of the Clean Air Act. Under the settlement, Trader Joe’s will spend an estimated $2 million over the next three years to reduce coolant leaks from refrigerators and other equipment and improve company-wide compliance. The company will also pay a $500,000 civil penalty.
The United States alleged that Trader Joe’s violated the Clean Air Act by failing to promptly repair leaks of R-22, a hydrochlorofluorocarbon (HCFC) that is an ozone-depleting substance and potent greenhouse gas used as a coolant in refrigerators. The company also failed to keep adequate servicing records of its refrigeration equipment and failed to provide information about its compliance record.
“By reducing the amount of ozone depleting refrigerants and potent greenhouse gasses released into the atmosphere, this settlement will assist our efforts to control these two major global environmental problems,” said Assistant Attorney General John C. Cruden of the Department of Justice’s Environment and Natural Resources Division. “The consent decree will also help assure Trader Joe’s future compliance with the Clean Air Act, by requiring heightened auditing, leak monitoring, centralized computer recordkeeping, and searchable electronic reporting to EPA.”
Trader Joe’s will now implement a corporate refrigerant compliance management system to comply with federal stratospheric ozone regulations and to detect and repair leaks through a new quarterly leak monitoring program. In addition, Trader Joe’s will achieve and maintain an annual corporate-wide average leak rate of 12.1 percent through 2019, well below the grocery store sector average of 25 percent. The company must also use non-ozone depleting refrigerants at all new stores and major remodels and at least 15 of these stores must use advanced refrigerants, such as carbon dioxide which have significantly less global warming potential compared to typical refrigerants.
“Taking action to combat climate change is a priority for the Obama Administration and this settlement will result in substantial cuts to one of the most potent greenhouse gases,” said Cynthia Giles, Assistant Administrator for EPA’s Office of Enforcement and Compliance Assurance. “The company-wide upgrades Trader Joe’s will make are not only good for the environment, they set a high bar for the grocery industry for detecting and fixing coolant leaks.”
“Some of the refrigerants now in use by Trader Joe’s are up to 4,700 times more potent than carbon dioxide,” said Acting Regional Administrator Alexis Strauss for EPA’s Pacific Southwest. “Today’s settlement will affect all of Trader Joe’s current and new stores to prevent the release of approximately 31,000 metric tons of carbon-equivalent greenhouse gases.”
The total estimated greenhouse gas emissions reductions from this settlement are equal to the amount from over 6,500 passenger vehicles driven in one year, the CO2 emissions from 33 million pounds of coal burned, or the carbon sequestered by 25,000 acres of forests in one year.
EPA regulations issued under the Clean Air Act require that owners or operators of commercial refrigeration equipment that contain over 50 pounds of ozone-depleting refrigerants repair any leaks within 30 days. Damage to the ozone layer results in dangerous amounts of cancer-causing ultraviolet solar radiation, increasing skin cancers and cataracts. R-22 is also a potent greenhouse gas with 1,800 times more global warming potential than carbon dioxide. Approximately one-quarter of Trader Joe’s equipment units use hydrofluorocarbon (HFC) refrigerants that are non-ozone-depleting, but have a high global warming potential. An added benefit of repairing refrigerant leaks is improved energy efficiency of the system which can save electricity.
The settlement is the third in a series of national grocery store refrigerant cases, including cases previously filed against Safeway Inc. and Costco Wholesale Corp. Today’s settlement also supports the goals of President Obama’s Climate Action Plan by reducing HFC emissions, as well as EPA’s proposal under Section 608 of the Clean Air Act that aims to update requirements and improve refrigerant management practices for refrigerants that are greenhouse gases, but not ozone-depleting, such as HFCs. This is the first EPA settlement with requirements to repair leaks of HFCs in order to further reduce greenhouse gas emissions.
Trader Joe’s, headquartered in Monrovia, California, is a privately held chain of specialty grocery stores in the U.S., with 461 stores located in 43 states and Washington, D.C. and 2014 revenues of $9.38 billion.
The settlement was lodged today in the U.S. District Court for the Northern District of California and is subject to a 30-day public comment period and final court approval. It will be available for viewing at https://www.justice.gov/enrd/consent-decrees.
For more information on the Presidents Climate Action Plan, please visit: https://www.whitehouse.gov/sites/default/files/image/president27sclimateactionplan.pdf
U.S. Attorney's Office Honors 170 Officers and Agents for Outstanding Work in Law EnforcementRead the Press Release
WASHINGTON - The U.S. Attorney’s Office today honored about 170 law enforcement officers, agents, and investigators for their outstanding work on dozens of cases that led to the convictions of murderers, sex offenders, gang members, fraudsters, and other criminals. The event took place at the Great Hall of the Robert F. Kennedy Department of Justice Building.
U.S. Attorney Channing D. Phillips said the Office’s 34th Law Enforcement Awards Ceremony recognized the exceptional work performed by honorees on a wide variety of investigations, including those involving violent crimes, narcotics trafficking, fraud and public corruption, and national security matters. The efforts reflect the courage and commitment demonstrated on a daily basis by law enforcement on behalf of the community.
“Thousands of law enforcement officers work long and unpredictable hours to protect the citizens of the District of Columbia from threats at home and overseas,” said U.S. Attorney Phillips. “Their dedication to public service and justice inspires those of us who work with them on a daily basis. Today’s ceremony is a way to express our appreciation for their work.”
The ceremony honored the achievements of people from 23 agencies, including the Metropolitan Police Department (MPD), the FBI, the U.S. Immigration and Customs Enforcement (ICE) Office of Homeland Security Investigations (HSI), the Drug Enforcement Administration (DEA), the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the Internal Revenue Service-Criminal Investigation (IRS-CI), the Metro Transit Police Department, the Prince George’s County, Md. Police Department and other partners. Their efforts led to convictions in more than 50 cases that had an impact locally, nationally, and internationally.
The U.S. Attorney’s Office recognized the detective work performed by the Metropolitan Police Department in the investigation into the July 4, 2013 murder of 22-year-old Omar Sykes, a student at Howard University. Mr. Sykes was killed and another Howard University student was attacked in a botched attempted armed robbery in the 700 block of Fairmont Street NW. The MPD investigation led to the arrest of a man who pleaded guilty to a charge of second-degree murder while armed and was sentenced to 28 ½ years in prison.
Another team of MPD detectives and an evidence technician was honored for work on the investigation into the August 2011 murder of 91-year-old Viola Drath at her home in Georgetown. Their efforts led to the arrest and prosecution of Ms. Drath’s husband, Albrecht Muth, who had attempted to orchestrate the crime scene in an effort to make it look like his wife died of natural causes. MPD worked tirelessly to prove that Muth had indeed strangled his wife and then positioned her body to make it appear as if she fell in the bathroom and struck her head on the tub. Muth was found guilty in 2014 of first-degree (premeditated) murder with the aggravating circumstances that the murder was especially heinous, cruel, and inflicted on a vulnerable victim. He is serving decades in prison for the crime.
The honorees also included a team from the Metropolitan Police Department and U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives that investigated a drive-by shooting that wounded 13 people in March 2013 on North Capitol Street. The violence stemmed from a rivalry between two groups of people that flared up at a nearby nightclub. Gunmen fired a total of 38 shots from two separate cars into a crowd of people walking back to their homes or cars at the Tyler House neighborhood or Sursum Corda neighborhood. Ultimately, 14 individuals were convicted of crimes related to the mass shootings. During this investigation, several other violent crimes were closed, along with over 50 commercial burglaries.
The ceremony also recognized a team from MPD and the Department of Homeland Security’s U.S. Immigration and Customs Enforcement (ICE) that conducted an extensive investigation into activities of MS-13 in the Washington, D.C. area. Ultimately, 20 MS-13 members were charged with racketeering and related offenses in U.S. District Court. The defendants were charged with four murders, two attempted murders, and numerous other crimes, including kidnapping, robbery, drug trafficking, extortion, and obstruction of justice. Nearly all pleaded guilty to charges. Three MS-13 leaders went to trial and were found guilty of conspiracy to participate in racketeering activity, murder and other charges. Two of the three leaders were sentenced last year to life in prison and the other was sentenced to a 30-year term.
Additionally, three members of the Metro Transit Police Department were honored for their work leading to the arrest and conviction of a man who stabbed a transgender girl in July 2014 while she was on board a Metrorail train. The victim, 15, was attacked in the late afternoon while on a Green Line train approaching the Fort Totten Metro station in Northeast Washington Her attacker pleaded guilty to a charge of assault with a dangerous weapon, with a hate crime enhancement, and he was subsequently sentenced to 56 months in prison.
The ceremony also recognized a team from the FBI’s Washington Field Office that investigated a Ponzi scheme that cost investors approximately $28.6 million. The scheme collapsed, victimizing more than 150 people. The FBI’s work led to the arrest and prosecution of a Maryland man who pled guilty to securities fraud. He is serving a 28 ½-year prison term.
On the international front, a team from the FBI’s Washington Field Office and the FBI’s Counterterrorism Division was honored for its work on the investigation of the Sept. 16, 2007, shooting at Nisur Square in Baghdad, Iraq, that resulted in the killing of 14 unarmed civilians and the wounding of numerous others. Four Blackwater USA security contractors were found guilty in 2014, following a 10-week trial, of charges stemming from the shootings. The crime scene was large and the investigation required much international travel, both by witnesses and investigators. A total of 71 witnesses, including 30 from Iraq, testified at the trial, representing the largest group of foreign witnesses ever to travel to the United States for a criminal trial.
Two Pharmacists Sentenced to Prison for Adulteration of Drugs in Connection with Alabama-Based Compounding PharmacyRead the Press Release
The Department of Justice announced today that two Alabama pharmacists have been sentenced to 12 and 10 months in prison for their roles in the distribution of adulterated drugs, which were compounded at the now-defunct compounding pharmacy Advanced Specialty Pharmacy doing business as Meds IV.
David Allen, 60, of McCalla, Alabama, was the former pharmacist-in-charge of Meds IV, and William Timothy Rogers, 48, of Hoover, Alabama, was the former president of Meds IV. Both men pleaded guilty in March 2016 to two misdemeanor violations of the Federal Food, Drug and Cosmetic Act (FDCA). Allen and Rogers were sentenced to 12 months and 10 months in prison, respectively, by U.S. District Court Judge Virginia Emerson Hopkins for the Northern District of Alabama. Judge Hopkins also sentenced both defendants to one year of supervised release following their imprisonment and a $5,000 fine.
“Compounding pharmacies are entrusted with protecting the public’s health from any harm their drugs may impose and must comply with the law,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “These cases demonstrate that the Department of Justice will continue to work aggressively with the U.S. Food and Drug Administration (FDA) to protect consumers from drugs compounded under insanitary conditions.”
“Meds IV provided intravenous nutrition to patients, without taking legally required precautions in the preparation of its product,” said U.S. Attorney Joyce White Vance for the Northern District of Alabama. “As a result, a number of patients developed serious infections. We are committed to prosecuting this type of practice to the fullest extent of the law provides for and protecting the safety of our citizens.”
“Producing unsafe and contaminated drugs poses a serious threat to the U.S. public health and cannot be tolerated,” said Director George Karavetsos of the FDA’s Office of Criminal Investigations. “The FDA remains fully committed to aggressively pursuing those who place unsuspecting American consumers at risk by distributing adulterated drugs.”
As alleged in the information, Meds IV compounded various drugs for human use, including an intravenous drug known as Total Parenteral Nutrition (TPN). TPN is liquid nutrition administered intravenously to patients who cannot or should not receive their nutrition through eating. The information alleged that beginning in or around February 2011, Meds IV compounded its own amino acid solution, which it then mixed with other ingredients to form TPN.
As charged in the information, amino acid used in compounding the TPN was adulterated in that it was contaminated with Serratia marcescens (S. marcescens) and was prepared, packed, or held under insanitary conditions. S. marcescens is a bacteria that can cause bloodstream infections if introduced into the bloodstream through contaminated medications. These infections can cause serious medical complications, including death, because S. marcescens is resistant to many antibiotics.
According to the charging document, the amino acid was prepared by Meds IV outside a laminar airflow workbench and was kept unrefrigerated, in a room that was not sterile, in a large pot sitting on the floor, sometimes overnight, before it was sterilized and used.
As alleged in the information, between March 5 and 15, 2011, nine patients at various Birmingham-area hospitals who developed bloodstream infections caused by S. marcescens died, and several other hospital patients developed S. marcescens bloodstream infections but survived. According to the charges, all of these patients had been given TPN that was compounded and distributed by Meds IV. As alleged in the information, while a number of the patients who died had underlying conditions which may have contributed to their deaths, medical records of some patients suggest that the S. marcescens bloodstream infections were also a significant factor.
According to the information, Meds IV was notified on March 14, 2011, by a hospital in the Birmingham area, that four patients receiving TPN had tested positive for S. marcescens. The information alleged that the TPN was compounded and distributed by Meds IV and that this notification was the first time Meds IV was informed of a link between its TPN and patients testing positive for S. marcescens. The information alleged that on or around March 16, 2011, Meds IV began notifying some customers that compounding of TPN was suspended until further notice.
As noted in the information, during an inspection at Meds IV starting on March 22, 2011, investigators from the U.S. Centers for Disease Control and Prevention (CDC) found S. marcescens that was indistinguishable from the outbreak strain on a tap-water faucet, in an open container of amino acid powder, and on the surface of mixing equipment that had been used to make TPN. According to the charging document, the FDA and CDC investigators linked the S. marcescens to TPN that had been compounded by Meds IV.
As alleged in the information, Allen supervised all compounding at Meds IV, was specifically responsible for reviewing and approving TPN formulations and was also responsible for filling the individual prescriptions Meds IV received for patient-specific TPN products. The information alleged that Rogers was ultimately responsible for overseeing all of the day-to-day operations of Meds IV. Both defendants pleaded guilty to two misdemeanor counts, representing the two lots of amino acid which were determined to be adulterated in violation of the FDCA.
The case was prosecuted by Trial Attorney Heide L. Herrmann of the Justice Department’s Consumer Protection Branch and Assistant U.S. Attorney Henry Cornelius of the Northern District of Alabama. They were assisted by Associate Chief Counsel Shannon M. Singleton of the Food and Drug Division, Office of General Counsel, Department of Health and Human Services. The case was investigated by the FDA’s Office of Criminal Investigations.
Additional information about the Consumer Protection Branch and its enforcement efforts may be found at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the Northern District of Alabama, visit its website at https://www.justice.gov/usao-ndal.
Two Pharmacists Sentenced to Prison for Adulteration of Drugs in Connection with Alabama Based Compounding PharmacyRead the Press Release
WASHINGTON - The Department of Justice announced today that two Alabama pharmacists have been sentenced to 12 and 10 months in prison for their roles in the distribution of adulterated drugs, which were compounded at the now-defunct compounding pharmacy Advanced Specialty Pharmacy doing business as Meds IV.
David Allen, 60, of McCalla, Alabama, was the former pharmacist-in-charge of Meds IV, and William Timothy Rogers, 48, of Hoover, Alabama, was the former president of Meds IV. Both men pleaded guilty in March 2016 to two misdemeanor violations of the Federal Food, Drug and Cosmetic Act (FDCA). Allen and Rogers were sentenced to 12 months and 10 months in prison, respectively, by U.S. District Court Judge Virginia Emerson Hopkins for the Northern District of Alabama. Judge Hopkins also sentenced both defendants to one year of supervised release following their imprisonment and a $5,000 fine.
“Compounding pharmacies are entrusted with protecting the public’s health from any harm their drugs may impose and must comply with the law,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “These cases demonstrate that the Department of Justice will continue to work aggressively with the U.S. Food and Drug Administration (FDA) to protect consumers from drugs compounded under insanitary conditions.”
“Meds IV provided intravenous nutrition to patients, without taking legally required precautions in the preparation of its product,” said U.S. Attorney Joyce White Vance for the Northern District of Alabama. “As a result, a number of patients developed serious infections. We are committed to prosecuting this type of practice to the fullest extent of the law provides for and protecting the safety of our citizens.”
“Producing unsafe and contaminated drugs poses a serious threat to the U.S. public health and cannot be tolerated,” said Director George Karavetsos of the FDA’s Office of Criminal Investigations. “The FDA remains fully committed to aggressively pursuing those who place unsuspecting American consumers at risk by distributing adulterated drugs.”
As alleged in the information, Meds IV compounded various drugs for human use, including an intravenous drug known as Total Parenteral Nutrition (TPN). TPN is liquid nutrition administered intravenously to patients who cannot or should not receive their nutrition through eating. The information alleged that beginning in or around February 2011, Meds IV compounded its own amino acid solution, which it then mixed with other ingredients to form TPN.
As charged in the information, amino acid used in compounding the TPN was adulterated in that it was contaminated with Serratia marcescens (S. marcescens) and was prepared, packed, or held under insanitary conditions. S. marcescens is a bacteria that can cause bloodstream infections if introduced into the bloodstream through contaminated medications. These infections can cause serious medical complications, including death, because S. marcescens is resistant to many antibiotics.
According to the charging document, the amino acid was prepared by Meds IV outside a laminar airflow workbench and was kept unrefrigerated, in a room that was not sterile, in a large pot sitting on the floor, sometimes overnight, before it was sterilized and used.
As alleged in the information, between March 5 and 15, 2011, nine patients at various Birmingham-area hospitals who developed bloodstream infections caused by S. marcescens died, and several other hospital patients developed S. marcescens bloodstream infections but survived. According to the charges, all of these patients had been given TPN that was compounded and distributed by Meds IV. As alleged in the information, while a number of the patients who died had underlying conditions which may have contributed to their deaths, medical records of some patients suggest that the S. marcescens bloodstream infections were also a significant factor.
According to the information, Meds IV was notified on March 14, 2011, by a hospital in the Birmingham area, that four patients receiving TPN had tested positive for S. marcescens. The information alleged that the TPN was compounded and distributed by Meds IV and that this notification was the first time Meds IV was informed of a link between its TPN and patients testing positive for S. marcescens. The information alleged that on or around March 16, 2011, Meds IV began notifying some customers that compounding of TPN was suspended until further notice.
As noted in the information, during an inspection at Meds IV starting on March 22, 2011, investigators from the U.S. Centers for Disease Control and Prevention (CDC) found S. marcescens that was indistinguishable from the outbreak strain on a tap-water faucet, in an open container of amino acid powder, and on the surface of mixing equipment that had been used to make TPN. According to the charging document, the FDA and CDC investigators linked the S. marcescens to TPN that had been compounded by Meds IV.
As alleged in the information, Allen supervised all compounding at Meds IV, was specifically responsible for reviewing and approving TPN formulations and was also responsible for filling the individual prescriptions Meds IV received for patient-specific TPN products. The information alleged that Rogers was ultimately responsible for overseeing all of the day-to-day operations of Meds IV. Both defendants pleaded guilty to two misdemeanor counts, representing the two lots of amino acid which were determined to be adulterated in violation of the FDCA.
The case was prosecuted by Trial Attorney Heide L. Herrmann of the Justice Department’s Consumer Protection Branch and Assistant U.S. Attorney Henry Cornelius of the Northern District of Alabama. They were assisted by Associate Chief Counsel Shannon M. Singleton of the Food and Drug Division, Office of General Counsel, Department of Health and Human Services. The case was investigated by the FDA’s Office of Criminal Investigations.
Additional information about the Consumer Protection Branch and its enforcement efforts may be found at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the Northern District of Alabama, visit its website at https://www.justice.gov/usao-ndal.
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Two Orange County Men Convicted of Conspiring to Join ISIL; They also Engaged in Fraud to Finance One’s Trip to SyriaRead the Press Release
SANTA ANA, California – A federal jury today convicted two Orange County men – one of whom attempted to travel to the Middle East to join ISIL – of conspiring to provide material support to the Islamic State of Iraq and the Levant (ISIL).
Nader Elhuzayel and Muhanad Badawi, both of whom are 25-year-old Anaheim residents, were convicted today in United States District Court following a two-week trial. Elhuzayel also was found guilty of attempting to provide material support, and Badawi was found guilty of aiding and abetting the attempt to provide support to ISIL.
In addition to the terrorism-related counts, Elhuzayel was found guilty of 26 counts of bank fraud, and Badawi was found guilty of one count of federal financial aid fraud. The jury deliberated for just over an hour before returning its guilty verdicts.
Both men were arrested on May 21, 2015, when Elhuzayel attempted to board a plane at Los Angeles International Airport to travel to Turkey to join ISIL. Badawi had purchased a one-way ticket on Turkish Airlines for Elhuzayel to travel to Israel, with a layover in Istanbul.
Badawi and Elhuzayel used social media to discuss ISIL and terrorist attacks, expressed a desire to die as martyrs, and made arrangements for Elhuzayel to leave the United States to join ISIL. In recorded conversations, Badawi and Elhuzayel “discussed how it would be a blessing to fight for the cause of Allah, and to die in the battlefield,” and they referred to ISIL as “we.”
The evidence at trial also showed that Badawi had a Facebook account, on which he made posts that supported ISIL and violence aimed at non-Muslims, and he said he intended to join the terrorist organization. Elhuzayel also had a Facebook account and used the ISIL flag as his profile picture. “On October 21, 2014, defendant Badawi made a video of defendant Elhuzayel in which defendant Elhuzayel swore allegiance to the leader of ISIS, Abu Bakr al-Baghdadi, and pledged to travel to Syria to be an ISIS fighter,” according to court documents.
Elhuzayel was convicted of obtaining cash through a scheme to defraud three different banks by depositing stolen checks into his personal checking accounts and then withdrawing cash at branch offices and ATMs in Orange County. The money generated from the bank fraud was to finance his travel to Syria to join ISIL.
Badawi was convicted of using his federal financial aid to purchase a plane ticket for Elhuzayel to travel to Turkey. The time of the fraud and the time of the terrorist activity coincide.
“These two defendants betrayed their country and sought to join ISIL, a terrorist organization dedicated to brutally murdering innocent people,” said United States Attorney Eileen M. Decker. “The FBI and the Orange County Joint Terrorism Task Force did outstanding work in investigating and apprehending these men before their plans could be completed. The fine work of law enforcement undoubtedly saved lives, both in the United States and abroad.”
“These convictions are a message to those who aim to travel to take up arms with ISIL and to those who support them – the FBI and our partners are determined to thwart your efforts,” said Deirdre Fike, Assistant Director in Charge of the FBI’s Los Angeles Field Office. “The JTTF’s proactive identification of these subjects and disruption of a terrorist conspiracy is a coup in the fight against the scourge of ISIL. At trial, the jury heard evidence that Mr. Badawi also encouraged other associates to support ISIL and participate in violent jihad. This is a reminder that our work is not done and the public must remain steadfast and report suspicious behavior, whether that behavior is carried out in person or online.”
After the jury returned its verdicts, United States District Judge David O. Carter scheduled Elhuzayel’s sentencing hearing for September 19 and Badawi’s sentencing hearing for September 26.
At the time of sentencing, Elhuzayel will face a statutory maximum sentence of 30 years in federal prison on each bank fraud count, Badawi faces a statutory maximum sentence of five years imprisonment on the financial aid fraud count, and both men each face a statutory maximum sentence of 15 years in prison on each count of providing material support to ISIL.
Both men have been held in federal custody without bond since their arrests.
The investigation in this case was conducted by the FBI’s Joint Terrorism Task Force in Orange County, which includes the following agencies: the Anaheim Police Department, the California Highway Patrol, the Orange County Sheriff’s Department, the Orange County Intelligence Assessment Center, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, the United States Secret Service, IRS – Criminal Investigation, the City of Orange Police Department, the Irvine Police Department, the Naval Criminal Investigative Service and the Orange County Regional Computer Forensics Laboratory. The Department of Education, Office of Inspector General provided substantial assistance in the investigation.
The case was prosecuted by Assistant United States Attorneys Judith A. Heinz and Deirdre Z. Eliot of the Terrorism and Export Crimes Section, and Julius J. Nam of the General Crimes Section.
Two Hardy County men charged with heroin traffickingRead the Press Release
ELKINS, WEST VIRGINIA – A federal grand jury returned an indictment today charging Jason Wayne Russell, 38, of Moorefield, WV and Brandon David Fout, 20, of Old Fields, WV, with heroin trafficking, United States Attorney William J. Ihlenfeld, II, announced.
From January through June 2015, Russell and Fout allegedly conspired with one another to transport heroin across state lines from Baltimore, Maryland into West Virginia in order to redistribute the drug.
Russell and Fout are each charged with one count of “Heroin Conspiracy,” one count of “Possession with Intent to Distribute Heroin – Aiding and Abetting,” and one count of “Interstate Travel in Furtherance of a Drug Crime.” They both face up to 20 years in prison and up to $1,000,000 in fines for each the conspiracy and possession charges. They also face up to five years in prison and a fine up to $250,000 for the interstate travel charge. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Stephen D. Warner is prosecuting the case on behalf of the government. The West Virginia State Police, West Virginia State Police – Bureau of Criminal Investigations, and the Hardy County Sheriff’s Office are investigating.
An indictment is merely an accusation. A defendant is presumed innocent unless and until proven guilty.
Two District Men Indicted by Grand Jury on 21 Charges Stemming from Shooting at Southeast Washington Barber ShopRead the Press Release
WASHINGTON – Terrence Atchison and Barry Bloomfield have been indicted by a grand jury on a total of 21 charges, including assault with intent to kill while armed and assault with intent to kill a minor while armed, stemming from a shooting earlier this year at a barber shop in Southeast Washington, announced Channing D. Phillips, the United States Attorney, and Cathy L. Lanier, Chief of the Metropolitan Police Department (MPD).
Atchison, 20, and Bloomfield, 27, both of Washington, D.C., are to be arraigned on the charges on June 23, 2016 at a hearing before the Honorable Zoe Bush in the Superior Court of the District of Columbia. The indictment, which was returned on June 15, 2016, includes a range of offenses. The lead charge carries a statutory maximum of 30 years in prison.
The indictment followed an investigation by the U.S. Attorney’s Office and the Metropolitan Police Department into the shooting, which took place on Friday, Feb. 12, 2016, at approximately 1:40 p.m. at Wrenn’s Barber Shop in the 1000 block of Eighth Street SE. The barber shop is a longstanding family business in the neighborhood. At the time of the shooting, the shop was bustling with customers. The customers included the two victims: an adult, who was shot in the leg and ankle, and his 21-month-old son, who was shot in the leg.
An indictment is merely a formal charge that a defendant has committed a violation of criminal laws and every defendant is presumed innocent until, and unless, proven guilty.
Atchison was arrested on Feb. 17, 2016, and Bloomfield was arrested on Feb. 18, 2016. They have been in custody while awaiting further court proceedings.
In announcing the indictment, U.S. Attorney Phillips and Chief Lanier commended the work of those who are investigating the case from the Metropolitan Police Department. They acknowledged the work of those handling the case at the U.S. Attorney’s Office, including Paralegal Specialist Allison Daniels and Victim/Witness Advocate James Brennan. Finally, they commended the efforts of Assistant U.S. Attorneys Lisa N. Walters and Thomas N. Saunders, who are prosecuting the matter.
Two Chinese nationals charged with defrauding Goodyear out of $1.5 millionRead the Press Release
Xin Franco Fan, 40, and Rex Xu Yu, 41, two Chinese nationals, were charged via criminal information with conspiracy to commit wire fraud and honest services wire fraud for defrauding Goodyear Tire & Rubber Company out of at least $1.5 million, said Acting U.S. Attorney Carole S. Rendon and Stephen D. Anthony, Special Agent in Charge of the FBI's Cleveland office.
Fan and Yu were employees of Goodyear Orient Company (Private) Limited, or GOCPL, a subsidiary of Goodyear, located in Singapore and with offices in China. GOCPL manages all of the natural rubber purchasing, delivery, financing and quality certifications for Goodyear’s global operations. Goodyear, through GOCPL, spends approximately $1 billion annually to acquire natural rubber for its operations. Fan was Yu’s manager, according to the information.
Fan, Yu and others incorporated or caused to be incorporated overseas shell companies in which they held a financial interest. Fan, Yu and others caused Goodyear to purchase natural rubber from these shell companies. They also required Goodyear suppliers to use loading companies in which they had a financial interest, This took place between 2013 and 2016, according to the information.
“These two defendants stole $1.5 million from Goodyear over several years,” Rendon said. “Goodyear is to be commended for promptly reaching out to law enforcement when they uncovered this scheme. Because of their quick action, these men will pay for their crimes.”
“The FBI is responsible for protecting the public’s interest in American companies by aggressively pursuing and bringing to justice those who unjustly profit from American ingenuity by stealing secrets,” said Stephen D. Anthony, Special Agent in Charge, FBI, Northern District of Ohio.
As a condition of their employment, Fan and Yu were obligated to act in the best interests of Goodyear when purchasing natural rubber. In 2015, Goodyear received an anonymous tip that Fan and Yu were receiving kickback payments in connection with GOCPL’s raw materials purchases. With the cooperation of Goodyear executives, an investigation into the matter led to Fan and Yu being arrested earlier this year and criminal charges being filed in federal court.
If convicted, the court will determine the defendants’ sentence after a review of factors unique to this case, including the defendants’ prior criminal record, if any, the defendants’ role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum. In most cases, it will be less than the maximum.
This case is being prosecuted by Assistant U.S. Attorneys Rebecca Lutzko, Henry F. DeBaggis and James Morford following an investigation by the FBI.
A charge 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.
Two California Men Convicted of Conspiring to Join ISILRead the Press Release
A federal jury today convicted two Orange County, California, men – one of whom attempted to travel to the Middle East to join the Islamic State of Iraq and the Levant (ISIL), a designated foreign terrorist organization – of conspiring to provide material support to ISIL.
The verdict was announced by Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Eileen M. Decker of the Central District of California and Assistant Director in Charge Deirdre Fike of the FBI’s Los Angeles Field Office.
Nader Elhuzayel, 25, and Muhanad Badawi, 25, both of Anaheim, California, were convicted today in U.S. District Court for the Central District of California following a two-week trial. Elhuzayel was found guilty of attempting to provide material support and Badawi was found guilty of aiding and abetting the attempt to provide material support to ISIL.
“Foreign terrorist fighters have traveled from countries around the world to join ISIL and are responsible for some of the most despicable acts of violence committed by the terrorist organization,” said Assistant Attorney General Carlin. “ISIL depends on these travelers as a significant part of its fighting force. Stopping Americans from engaging in terrorist activity on behalf of ISIL here or abroad will remain one of the highest priorities of the National Security Division.”
“These two defendants betrayed their country and sought to join ISIL, a terrorist organization dedicated to brutally murdering innocent people,” said U.S. Attorney Decker. “The FBI and the Orange County Joint Terrorism Task Force did outstanding work in investigating and apprehending these men before their plans could be completed. The fine work of law enforcement undoubtedly saved lives, both in the United States and abroad.”
“These convictions are a message to those who aim to travel to take up arms with ISIL and to those who support them – the FBI and our partners are determined to thwart your efforts,” said Assistant Director in Charge Fike. “The JTTF’s proactive identification of these subjects and disruption of a terrorist conspiracy is a coup in the fight against the scourge of ISIL. At trial, the jury heard evidence that Mr. Badawi also encouraged other associates to support ISIL and participate in violent jihad. This is a reminder that our work is not done and the public must remain steadfast and report suspicious behavior, whether that behavior is carried out in person or online.”
In addition to the terrorism-related counts, Elhuzayel was found guilty of 26 counts of bank fraud and Badawi was found guilty of one count of federal financial aid fraud.
Both men were arrested on May 21, 2015, when Elhuzayel attempted to board a plane at Los Angeles International Airport to travel to Turkey to join ISIL. Badawi had purchased for Elhuzayel a one-way ticket to Israel with a layover in Istanbul.
Badawi and Elhuzayel used social media to discuss ISIL and terrorist attacks, expressed a desire to die as martyrs and made arrangements for Elhuzayel to leave the United States to join ISIL. In recorded conversations, Badawi and Elhuzayel discussed “how it would be a blessing to fight for the cause of Allah, and to die in the battlefield.”
The evidence at trial also showed that Badawi had a Facebook account, on which he made posts that supported ISIL and violence aimed at non-Muslims, and he said he intended to join the terrorist organization. Elhuzayel also had a Facebook account and used the ISIL flag as his profile picture. According to court documents, on Oct. 21, 2014, Badawi made a video of Elhuzayel in which Elhuzayel swore allegiance to Abu Bakr al-Baghdadi, the leader of ISIL, and pledged to travel to Syria to be an ISIL fighter.
Elhuzayel was convicted of obtaining cash through a scheme to defraud three different banks by depositing stolen checks into his personal checking accounts and then withdrawing cash at branch offices and ATMs in Orange County. The money generated from the bank fraud was to finance his travel to Syria to join ISIL.
Badawi was convicted of using his federal financial aid to purchase a plane ticket for Elhuzayel to travel to Turkey.
U.S. District Judge David O. Carter of the Central District of California scheduled Elhuzayel’s sentencing hearing for Sept. 19, 2016, and Badawi’s sentencing hearing for Sept. 26, 2016.
At the time of sentencing, Elhuzayel will face a statutory maximum sentence of 30 years in prison on each bank fraud count, Badawi faces a statutory maximum sentence of five years in prison on the financial aid fraud count and both men each face a statutory maximum sentence of 15 years in prison on each material support count.
Both men have been held in federal custody without bond since their arrests.
The investigation in this case was conducted by the FBI’s Joint Terrorism Task Force in Orange County, which includes the following agencies: the Anaheim Police Department; the California Highway Patrol; the Orange County Sheriff’s Department; the Orange County Intelligence Assessment Center; U.S. Immigration and Customs Enforcement’s Homeland Security Investigations; the U.S. Secret Service; IRS-Criminal Investigation; the City of Orange, California, Police Department; the Irvine, California, Police Department; the Naval Criminal Investigative Service; and the Orange County Regional Computer Forensics Laboratory. The Department of Education’s Office of Inspector General provided substantial assistance in the investigation.
The case was prosecuted by Assistant U.S. Attorneys Judith A. Heinz, Deirdre Z. Eliot and Julius J. Nam of the Central District of California, with assistance from Trial Attorney Michael Dittoe of the National Security Division’s Counterterrorism Section.
Torrance County Man Arrested on Federal Charges Arising Out of HSI Seizure of 20.7 Kilograms of Methamphetamine and 1.8 Kilograms of HeroinRead the Press Release
ALBUQUERQUE –U.S. Attorney Damon P. Martinez and Special Agent in Charge Waldemar Rodriguez of Homeland Security Investigations (HSI) in El Paso announced the filing of narcotics trafficking and firearms charges against David Krowner, 42, of Estancia, N.M. The charges arising out of a June 17, 2016 seizure of 20.7 kilograms (45.54 pounds) of methamphetamine, 1.8 kilograms (3.96 pounds) of heroin, and three firearms.
Krowner made his initial appearance this morning in federal court in Albuquerque, N.M., on a criminal complaint charging him with possession of methamphetamine and heroin with intent to distribute and using and carrying firearms in relation to drug trafficking crimes. Krowner remains in custody pending a preliminary hearing and detention hearing, both of which are scheduled for tomorrow.
According to the criminal complaint, the investigation into Krowner began on June 1, 2016 when HSI received information that Krowner was transporting large quantities of illegal drugs into the Albuquerque area. The complaint alleges that Krowner was arrested in Albuquerque on June 17, 2016. After a narcotics canine allegedly detected the odor of illegal drugs in Krowner’s vehicle, agents searched the vehicle and discovered a large bin allegedly containing 20.7 kilograms of methamphetamine, 1.8 kilograms of heroin, two bags of unidentified pills, seven packages of steroids, two handguns, a shotgun and hundreds of rounds of ammunition. The agents also allegedly seized approximately $21,750.00 from the vehicle and another $4,500.00 from a pocket of Krowner’s pants.
If convicted of the narcotics trafficking charges in the complaint, Krowner faces a statutory mandatory minimum of ten years and a maximum of life in prison. If convicted of the firearms charges, Krowner faces a mandatory minimum of five years in prison that must be served consecutive to any sentence imposed on the narcotics charges.
Charges in criminal complaints are merely accusations and defendants are presumed innocent unless found guilty in a court of law.
The case was investigated by HSI’s Border Enforcement and Security Taskforce, which includes officers of the Albuquerque Police Department (APD), with assistance from APD’s Central Narcotics Unit. Assistant U.S. Attorney George Kraehe is prosecuting the case as part of a federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders primarily based on their prior convictions for federal prosecution with the goal of removing repeat offenders from communities in New Mexico for as long as possible. Because New Mexico’s violent crime rates, on a per capita basis, are amongst the highest in the nation, New Mexico’s law enforcement community is collaborating to target repeat offenders from counties with the highest violent crime rates, including Bernalillo County, under this initiative.
Three Mississippi Correctional Officers Indicted for Inmate Assault and Cover-UpRead the Press Release
WASHINGTON – In a nine-count indictment unsealed today, two Mississippi correctional officers were charged with beating an inmate and a third was charged with helping to cover it up.
The indictment charged Lawardrick Marsher, 28, and Robert Sturdivant, 47, officers at Mississippi State Penitentiary, in Parchman, Mississippi, with a beating that included kicking, punching and throwing the victim to the ground. Marsher and Sturdivant were charged with violating the right of K.H., a convicted prisoner, to be free from cruel and unusual punishment. Sturdivant was also charged with failing to intervene while Marsher was punching and beating K.H. The indictment alleges that their actions involved the use of a dangerous weapon and resulted in bodily injury to the victim.
A third officer, Deonte Pate, 23, was charged along with Marsher and Sturdivant for conspiring to cover up the beating. The indictment alleges that all three officers submitted false reports and that all three lied to the FBI.
If convicted, Marsher and Sturdivant face a maximum sentence of 10 years in prison on the excessive force charges. Each of the three officers faces up to five years in prison on the conspiracy and false statement charges, and up to 20 years in prison on the false report charges.
An indictment is merely an accusation, and the defendants are presumed innocent unless and until proven guilty.
This case is being investigated by the FBI’s Jackson Division, with the cooperation of the Mississippi Department of Corrections. It is being prosecuted by Assistant U.S. Attorney Robert Coleman of the Northern District of Mississippi and Trial Attorney Dana Mulhauser of the Civil Rights Division’s Criminal Section.
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Three Mississippi Correctional Officers Indicted for Inmate Assault and Cover-UpRead the Press Release
In a nine-count indictment unsealed today, two Mississippi correctional officers were charged with beating an inmate and a third was charged with helping to cover it up.
The indictment charged Lawardrick Marsher, 28, and Robert Sturdivant, 47, officers at Mississippi State Penitentiary, in Parchman, Mississippi, with a beating that included kicking, punching and throwing the victim to the ground. Marsher and Sturdivant were charged with violating the right of K.H., a convicted prisoner, to be free from cruel and unusual punishment. Sturdivant was also charged with failing to intervene while Marsher was punching and beating K.H. The indictment alleges that their actions involved the use of a dangerous weapon and resulted in bodily injury to the victim.
A third officer, Deonte Pate, 23, was charged along with Marsher and Sturdivant for conspiring to cover up the beating. The indictment alleges that all three officers submitted false reports and that all three lied to the FBI.
If convicted, Marsher and Sturdivant face a maximum sentence of 10 years in prison on the excessive force charges. Each of the three officers faces up to five years in prison on the conspiracy and false statement charges, and up to 20 years in prison on the false report charges.
An indictment is merely an accusation, and the defendants are presumed innocent unless and until proven guilty.
This case is being investigated by the FBI’s Jackson Division, with the cooperation of the Mississippi Department of Corrections. It is being prosecuted by Assistant U.S. Attorney Robert Coleman of the Northern District of Mississippi and Trial Attorney Dana Mulhauser of the Civil Rights Division’s Criminal Section.
Marsher Indictment
Three Charged in HUD House Flipping SchemeRead the Press Release
HAMMOND- United States Attorney David A. Capp announced that a federal grand jury in Hammond returned an indictment charging three individuals for their part in a house flipping scheme involving Department of Housing and Urban Development (HUD) properties.
The indictment charges Sergio Garcia, Sr.,46, of Chicago, IL and Sergio Garcia, Jr., 27, of Lowell, IN with conspiracy to commit mail fraud and ten substantive counts of mail fraud. It also charges Timothy D. Greene, 29, of Lansing, IL with submitting fraudulent information to HUD.
The indictment alleges that between January 1, 2011 and May 31, 2014, Defendants Sergio Garcia, Sr. and Sergio Garcia, Jr. conspired with others known and unknown to the Grand Jury to engage in a scheme to defraud and to obtain money by means of false pretenses, representations and promises.
The alleged scheme involved offering to buy more than 40 HUD homes situated in the following cities or towns in Indiana: Gary, Hammond, Merrillville, Whiting, East Chicago, Hobart, St. John, Valparaiso, and Lake Village; as well as the following cities or towns in Illinois: Cicero, Chicago, Maywood, Alsip, Stone Park, Riverdale, Chicago Heights, Berwyn, Lansing, Stickney, and Evergreen Park. The conspirators sought to purchase the homes from HUD and sell them the same day or soon thereafter for a profit to subsequent buyers.
The purchase contracts provided to HUD to purchase the properties stated that the conspirators or one of their businesses were purchasing the properties as investors and would pay with cash or use other financing not involving FHA. To support their claimed financial ability to pay for the homes, the conspirators mailed fraudulent letters purporting to show that they or their company had access to the funds needed to complete each purchase. Many of the letters purported to be written by a private venture capital business and falsely stated that a conspirator or their business held a line of credit of up to $500,000.00, when in fact, as the conspirators well knew: these letters were altered, forged and counterfeited; the lines of credit referenced therein did not exist; and the signatures thereon were forged and unauthorized.
The alleged scheme further involved the conspirators placing their own “for sale” signs at the HUD homes before their purchase from HUD had occurred.
When the conspirators could not find a subsequent purchaser to buy the homes, they allowed their purchase contracts with HUD to expire. The conspirators filed false liens on many of the HUD homes after their purchase contracts expired. The false liens hindered HUD from selling the homes to subsequent purchasers. The conspirators requested money from subsequent purchasers to release the false liens.
The indictment also alleges that on or about February 13, 2012, Timothy Daniel Greene provided a fraudulent letter to HUD stating he held an approved line of credit with a venture capital business and that he did so for the purpose of influencing HUD to approve a purchase offer he had submitted for a property in Chicago, IL.
The case is being investigated by the Federal Bureau of Investigation and the Department of Housing and Urban Development, Office of Inspector General. The case is being prosecuted by Assistant United States Attorney Jill R. Koster.
The United States Attorney's Office emphasized that an Indictment is merely an allegation and that all persons charged are presumed innocent until and unless proven guilty in court.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
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Texas Artist Sentenced to Prison for Failure to File Income Tax ReturnRead the Press Release
A San Antonio, Texas, artist was sentenced today in the U.S. District Court for the Western District of Texas in San Antonio to 12 months in prison by U.S. Magistrate Judge John W. Primomo, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division.
Carlos Cortes pleaded guilty to one count of failure to file a 2009 tax return on April 21. According to court documents, Cortes is an artist who works in the medium of “Faux Bois,” an artistic imitation of wood or wood grains in various media. His work has been commissioned by the city of San Antonio along with several San Antonio businesses.
According to Internal Revenue Service (IRS) records, Cortes did not file individual income tax returns for 2006, 2007, 2008 and 2009 despite earning gross income well in excess of the filing requirements. Cortes admitted that he had gross income of $62,043 in 2006, $66,138 for 2007, $457,192 for 2008 and $781,847 for 2009.
Judge Primomo ordered Cortes remanded into the custody of the U.S. Marshal’s Service to begin serving his sentence immediately. In addition to the prison term, Cortes was ordered to pay $404,433 in restitution and to serve one year of supervised release. He was also fined $6,000.
Acting Assistant Attorney General Ciraolo thanked special agents of IRS-Criminal Investigation, who investigated the case and Trial Attorney Robert Kemins of the Tax Division, who prosecuted the case.
Telephone Scammers Continue to Target Idaho ResidentsRead the Press Release
BOISE – The United States Attorney’s Office and the United States Marshals Service are advising Idaho residents to be aware of telephone calls threatening individuals of a pending arrest warrant. Calls have been reported in the Boise, Pocatello and Twin Falls area.
It was recently reported that Idaho residents have received a phone call from a person claiming to be a Deputy U.S. Marshal. When unsuspecting citizens return the call an automated message says:
You have reached the U.S. Marshals Service serving the Northern District of Idaho. If this is an emergency, hang up and dial 911. If you have information regarding the whereabouts of an absconded fugitive please remain on the line for the next available deputy. For all other inquiries please listen closely because our menu options have recently changed. For warrants division, press 1; for civil processing division, press 2; for gang enforcement, press 3; for the officer in charge, press 4; for clerk of courts, press 5.
Once connected to a person, individuals are given the choice to avoid a federal arrest warrant by paying a fine to settle out of court. The individual may be instructed to purchase a prepaid Visa or MasterCard, and to provide the number on the back of the card to the caller.
Because the telephone calls are continuing to occur, the United States Attorney wants the public to be aware of these scam calls. Officers do not notify people of arrest warrants by phone. A valid arrest warrant would be served in person by a Deputy U.S. Marshal or other law enforcement officer. Persons receiving such a telephone call are cautioned not to provide any information and to notify the U.S. Marshals Service immediately.
“I urge everyone who receives this type of phone call to be very skeptical, or better yet, simply hang up the phone,” said Brian T. Underwood, United States Marshal for the District of Idaho. “This is not a typical way that the U.S. Marshals resolve warrant related matters.”
It is a crime for an individual to falsely represent himself or herself as a federal official or Deputy United States Marshal. Accordingly, this scam and any similar fraudulent conduct will be investigated by the U.S. Marshals Service, in partnership with the FBI.
Sussex County, New Jersey, Man Admits Kidnapping and Murder-For-Hire PlotRead the Press Release
NEWARK, N.J. – A Newton, New Jersey, man today admitted that he planned the kidnapping and murder of a woman he met online, U.S. Attorney Paul J. Fishman announced.
Christopher Thieme, 36, of Sussex County, New Jersey, pleaded guilty before U.S. District Judge Susan D. Wigenton in Newark federal court to an information charging him with one count of attempted kidnapping and one count of murder-for-hire.
According to documents filed in this case and statements made in court:
Thieme admitted that from December 2015 through Jan. 4, 2016, he sought assistance from an associate to kidnap and ultimately murder a woman whom Thieme had previously met through an online dating service. Thieme’s associate alerted law enforcement to Thieme’s plans and cooperated with the investigation into Thieme’s plot.
In early January, at the direction of law enforcement, Thieme’s associate introduced Thieme to an undercover FBI agent posing as a hitman. Thieme explained to the undercover FBI agent that, once the victim was kidnapped, Thieme would empty the victim’s bank accounts and fraudulently sell off her home, the proceeds of which Thieme planned to use to pay for the kidnapping and murder.
The attempted kidnapping charge carries a potential penalty of 20 years in prison and a $250,000 fine. The murder-for-hire charge carries a potential penalty of 10 years in prison and a $250,000 fine. Sentencing is scheduled for Sept. 21, 2016.
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 members of the Passaic County Prosecutor’s Office, the New Jersey State Police, the Newton Police Department, the Paramus Police Department, the Paterson Police Department, the Roxbury Police Department, and the Wayne Police Department for their assistance.
The government is represented by Assistant U.S. Attorney Josh Hafetz of the U.S. Attorney’s Organized Crime/Gangs Unit in Newark.
Defense counsel: Patrick McMahon Esq., Assistant Federal Public Defender, Newark
Steubenville man forfeits $1.5 million, sentenced to house arrest for operating gambling businessRead the Press Release
A Steubenville man forfeited more than $1.5 million and was sentenced to eight months of house arrest for operating a gambling business, said Carole S. Rendon, Acting U.S. Attorney for the Northern District of Ohio, and Ohio Attorney General Mike DeWine.
Timothy Smith, 53, pleaded guilty earlier this year to one count of conducting an illegal gambling business. He was sentenced to eight months of house arrest with electronic monitoring and ordered to forfeit $1,526,104.
Smith operated Timmy’s, a sports wagering business in Steubenville where people could wager on professional and amateur sporting events. Employees at Timmy’s displayed dry erase boards and paper fliers showing high school, college and professional sporting events and associated point spreads. Confidential sources placed several bets on games in 2013 and 2014, according to court documents.
This case was prosecuted by Assistant U.S. Attorney David Toepfer and James Morford following an investigation by the Ohio Bureau of Criminal Investigation, the Steubenville Police Department and the FBI.
Springfield Sex Offender to Serve 35 Years in Prison for Production of Child PornographyRead the Press Release
Springfield, Ill. — A Springfield, Ill., man, Marcus B. Fifer, 44, who was convicted in October 2015 for producing child pornography, has been sentenced. On June 20, 2016, U.S. District Judge Sue E. Myerscough ordered that Fifer serve 35 years in federal prison and remain on supervised release for the remainder of his life after his release from prison.
A jury convicted Fifer on Oct. 30, 2015, on 17 counts of sexual exploitation of a minor to produce child pornography and one count of committing a felony offense with a minor while being required to register as a sex offender. Fifer has remained detained in U.S. Marshals’ custody since his arrest in February 2014.
At trial, the government presented evidence that from April 1, 2013 through Nov. 18, 2013, Fifer used a cell phone, tablet and laptop computer to take images of a minor. Further evidence from the government established that Fifer previously pled guilty in 2008, in Champaign County, Ill., to aggravated criminal sexual abuse, and at the time of the offenses for which Fifer was convicted in October 2015, he was required to register as a sex offender.
The charges were investigated by U.S. Immigration and Customs Enforcement Homeland Security Investigations in cooperation with the Springfield Police Department. Assistant U.S. Attorneys John E. Childress and Matthew Z. Weir prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Springfield Man Sentenced for Illegally Possessing FirearmRead the Press Release
BOSTON – Kendall Hill, 29, was sentenced today in U.S. District Court in Springfield for possessing a firearm while being a convicted felon.
Hill was sentenced by U.S. District Court Judge Mark G. Mastroianni to 57 months in prison and three years of supervised release. He pleaded guilty in April 2016.
On Sept. 21, 2015, Hill possessed a .22 caliber Ruger pistol loaded with eight rounds of .22 caliber ammunition. It was discovered in Hill’s closet by law enforcement officers who were executing outstanding Georgia and Massachusetts warrants. Hill has a an extensive, violent criminal history, including 2004 and 2005 firearms convictions in Massachusetts state courts and 2015 Massachusetts state convictions for breaking and entering and assault and battery. Hill was on probation for the 2015 cases at the time that he committed this federal offense.
United States Attorney Carmen M. Ortiz; Daniel J. Kumor, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms & Explosives, Boston Field Division; and Springfield Police Commissioner John Barbieri, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Katharine A. Wagner of Ortiz’s Springfield Branch Office.
Second New York woman pleads guilty to credit card fraudRead the Press Release
CHARLESTON, W.Va. – A second New York City woman pleaded guilty today to credit card fraud, announced Acting United States Attorney Carol Casto. Sasha Nelson, 21, entered her guilty plea to possession of 15 or more counterfeit access devices. A counterfeit access device is a credit card that has been altered to contain stolen account information that is magnetically re-encoded on the credit card.
Nelson admitted that she, along with codefendant Nayosha Aice, possessed 78 counterfeit access devices. Nelson and Aice drove from New York City, using these counterfeit credit cards to buy cartons of Newport cigarettes and other merchandise. They were observed at the St. Albans Go-Mart using multiple counterfeit cards on June 25, 2015, and, after noticing the suspicious behavior, store employees contacted law enforcement. Nelson further admitted that once she realized police were observing them, she hid some of the credit cards on a shelf in a nearby store, while Aice threw some of the credit cards away in a nearby garbage can. Officers recovered the credit cards and subsequently confirmed that the credit cards were counterfeit access devices.
Nelson faces up to 10 years in federal prison and a $250,000 fine when she is sentenced on September 15, 2016. Her codefendant, Nayosha Aice, also of New York City, previously pleaded guilty on June 8, 2016, and is scheduled to be sentenced on the same date.
The St. Albans Police Department and the United States Secret Service conducted the investigation. Assistant United States Attorneys Erik S. Goes and Eric Bacaj are in charge of the prosecution. The plea hearing was held before United States District Judge John T. Copenhaver, Jr.
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San Jose Resident Pleads Guilty to Tax EvasionRead the Press Release
SAN FRANCISCO – Walter Rhodes pleaded guilty today to tax evasion, announced United States Attorney Brian J. Stretch and Internal Revenue Service, Criminal Investigation, Special Agent in Charge Michael T. Batdorf.
According to the plea agreement, Rhodes, 64, of San Jose, admitted he attempted to evade the payment of more than $300,000 that he owed in federal income tax liabilities for the years 2002 through 2007. Rhodes admitted that between 2006 and 2011, he received numerous notices from the IRS explaining that he owed income taxes for the years 2002 through 2007. In 2009, the IRS levied his bank account. Subsequently, Rhodes opened a bank account using the name and social security number of another person. Rhodes also used that other person’s name and social security number to obtain employment as the vice president of an energy company. In an effort to further evade payment of his employment taxes, Rhodes arranged for the salary he received from his employment to be deposited into the account he opened in the other person’s name. As of September 24, 2013, Rhodes owed $514,476 in taxes and interest for 2002 through 2007.
Rhodes was indicted on July 25, 2015. He was charged with one count each of tax evasion, in violation of 26 U.S.C. § 7201; obstructing administration of Internal Revenue Laws, in violation of 26 U.S.C. § 7212(a); social security fraud, in violation of 42 U.S.C. § 408(a)(7); and aggravated identity theft, in violation of 18 U.S.C. § 1028A. Pursuant to today’s agreement, Rhodes pleaded guilty to tax evasion. The remaining charges will be dismissed.
The maximum penalty for a violation of 26 U.S.C. § 7201 is five years in prison and a fine of $250,000. Additional monetary assessments and supervised release may be imposed; however, any sentence following this conviction will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553. Rhodes’ sentencing is scheduled for October, 11, 2016, before the Honorable Beth Labson Freemen, U.S. District Judge.
Assistant U.S. Attorney José A. Olivera is prosecuting the case. The prosecution is the result of an investigation by the Internal Revenue Service, Criminal Investigation.
Salinas Man Pleads Guilty to Embezzling More Than $182,700 from Carmel Golf ClubRead the Press Release
SAN JOSE – Neal Morton pleaded guilty to bank fraud, announced United States Attorney Brian J. Stretch and Internal Revenue Service Criminal Investigation, Special Agent in Charge Michael T. Batdorf.
According to the plea agreement signed yesterday, from 2009 through February 4, 2014, Morton, 50, of Salinas, was employed in the accounting department of Tehama Golf Club (TGC), a private golf course and residential community center in Carmel, Calif. Morton oversaw TGC’s accounting department and was responsible for keeping TGC’s books and records. During this period, Morton devised a scheme to embezzle funds from TGC by causing TGC to issue checks drawn on its bank accounts with forged signatures. Morton saved digital copies of TGC employees’ signatures who were authorized to sign checks and drafted checks listing himself as the payee. To conceal the offense, Morton authored false entries in TGC’s books to give the appearance that the checks were used to pay for a valid business expense. In addition to the checks, Morton also stole more than $100,000 in TGC’s petty cash fund.
Morton was indicted on September 29, 2015. He was charged with bank fraud, in violation of 18 U.S.C. § 1344(2); and aggravated identity theft, in violation of 18 U.S.C. § 1028A. Pursuant to yesterday’s agreement, Morton pleaded guilty to bank fraud. Morton is scheduled to appear on October 24, 2016, at 1:30 pm for sentencing.
The maximum statutory penalty for bank fraud, in violation of 18 U.S.C. § 1344(2) is thirty years in prison and a fine of $1,000,000. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant United States Attorneys Thomas Newman and Jose A. Olivera are prosecuting the case. The prosecution is the result of an investigation by the Internal Revenue Service, Criminal Investigation.
Retired Orleans Parish Sheriff’s Office Chief Deputy Gerald Ursin, Jr. Charged with Conspiracy to Commit Wire FraudRead the Press Release
U.S. Attorney Kenneth A. Polite announced that GERALD URSIN, JR., age 62, of New Orleans and a retired Chief Deputy of the Orleans Parish Sheriff’s Office (“OPSO”), was charged in a one-count Bill of Information with conspiracy to commit wire fraud.
According to today’s Bill of Information, beginning in 2009 and continuing until January 2014, URSIN and others participated in a conspiracy to commit wire fraud.
The Bill of Information alleges that URSIN, in his role as a Chief Deputy in the Orleans Parish Sheriff’s Office, engaged in a scheme to defraud local entities and events, including Mardi Gras Krewes, music and food festivals, and sporting events, by padding the billing documents with names of individuals who did not in fact provide any security services (“Ghost Employees”).
According to the Bill of Information, after the fraudulently inflated invoices were submitted via interstate wires, a portion of the overbilled amount was given to URSIN in the form of checks made payable to URSIN’s family members under the fraudulent guise of payments for detail work that in fact did not take place.
If convicted of conspiring with others to commit wire fraud, URSIN faces statutory penalties of up to five years in prison, a $250,000 fine and three years of supervised release.
U.S. Attorney Polite reiterated that the Bill of Information is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
U.S. Attorney Polite praised the work of the Federal Bureau of Investigation in investigating this matter and acknowledged the assistance provided by the Louisiana Legislative Auditors. Assistant U.S. Attorney Sean Toomey is in charge of the prosecution.
Point Richmond Resident Convicted of Tax EvasionRead the Press Release
OAKLAND - A federal jury in Oakland returned a guilty verdict against Richard Thomas Grant yesterday afternoon on three counts of tax evasion, announced United States Attorney Brian J. Stretch and Internal Revenue Service, Criminal Investigation, Special Agent in Charge Michael T. Batdorf. The trial and conviction follows a three count superseding indictment on December 4, 2014, of tax evasion, in violation of 26 U.S.C. § 7201.
According to evidence presented at trial, Grant, 64, of Point Richmond, Calif., was a partner in Grant Engineering & Manufacturing, an engineering company in Richmond. Grant Engineering used a bookkeeper for monthly and annual bookkeeping who had access to Grant Engineering’s invoices, company checkbook, and monthly bank statements. From at least 2005 to 2009, the bookkeeper provided the company’s records to a CPA to prepare Grant Engineering’s annual partnership returns. From 2005 through 2009, Grant Engineering’s partnership income was $509,339, $566,741, $486,062, $598,977, and $604,706, respectively. Although the defendant’s share was half of these amounts during each of these years, the IRS nevertheless has no record of receiving Grant’s personal tax returns from 2005 through at least 2009. The evidence demonstrated Grant paid no federal income tax on his income from Grant Engineering during the years charged.
During 2005 and 2006, Grant took steps to conceal the income he received through Grant Engineering. For example, in 2005 Grant significantly curbed the use of his two checking accounts and began moving his partnership distributions from Grant Engineering to a warehouse bank known as MyICIS in Berryville, Ariz. Warehouse banks can be used to conceal ownership of funds in part by commingling such funds with those of other individuals. In addition, between April 2005 and October 2006, Grant wrote hundreds of checks drawn on the MYICIS account and funded multiple prepaid debit cards. Grant used the checks and debit cards to pay his mortgage and other personal expenses.
Eventually, the federal government shut down MYICIS. Grant, however, took additional steps to prevent the IRS from discovering the income he received from Grant Engineering. Specifically, Grant used another bank to convert his partnership distributions to cashier’s checks and cash, all the while avoiding depositing the vast majority of the funds into any one bank account. He also used cash to purchase dozens of U.S. Postal Money Orders and then used the money orders to pay bills and expenses, including utilities, taxes, and expenses for his classic aircraft.
Grant, was convicted on all three counts of tax evasion in the superseding indictment.
Assistant U.S. Attorney Colin Sampson, and Department of Justice Tax Division Trial Attorney Matthew Kluge are prosecuting the case. The prosecution is the result of an investigation by the Internal Revenue Service, Criminal Investigation.
Pikesville Man Indicted on Federal Murder ChargeRead the Press Release
Baltimore, Maryland – A federal grand jury today returned an indictment charging Stanislav “Steven” Yelizarov, age 26, of Pikesville, Maryland, with using, carrying and discharging a firearm during a crime of violence, resulting in death.
The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation, Baltimore Field Office; Chief James W. Johnson of the Baltimore County Police Department; and Baltimore Police Commissioner Kevin Davis.
According to the indictment, on December 26, 2009, Yelizarov allegedly shot and killed a man during a commercial robbery.
Yelizarov faces a maximum sentence of death or life in prison. An initial appearance has not yet been scheduled in U.S. District Court in Baltimore. Yelizarov is currently in prison serving a sentence on unrelated state and federal charges.
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 the FBI, Baltimore County Police Department and Baltimore City Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Paul E. Budlow and Aaron S. J. Zelinsky, who are prosecuting the case.
Philadelphia Man Indicted on Gun and Drug ChargesRead the Press Release
PHILADELPHIA - James Spears, 33, of Philadelphia, PA, was charged today by indictment with possession with intent to distribute cocaine base (“crack”) and cocaine, and possession of a firearm in furtherance of a drug trafficking crime, announced United States Attorney Zane David Memeger. The indictment charges that the defendant committed these offenses in Philadelphia between December 28, 2012 and January 3, 2013.
If convicted of all charges, the defendant faces a mandatory minimum sentence of five years in prison with a maximum sentence of life, five years of supervised release, a possible fine, and a $300 special assessment.
This case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Salvatore L. Astolfi.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Philadelphia Man Charged in Two Bank RobberiesRead the Press Release
PHILADELPHIA - Ryan J. McAteer, 35, of Philadelphia, PA, was charged today by indictment with two counts of bank robbery, announced United States Attorney Zane David Memeger. The indictment charges that McAteer robbed the Republic Bank, located at 1601 Walnut Street in Philadelphia, Pennsylvania, on May 2, 2016, and Citizens Bank, located at 123 Chestnut Street in Philadelphia, Pennsylvania on May 3, 2016.
If convicted, McAteer faces a maximum sentence of 40 years in prison, a possible fine, three years of supervised release, and a $200 special assessment.
This case has been investigated by the Federal Bureau of Investigation, the Philadelphia Police Department, the Haddon Township (New Jersey) Police Department, the Haddon Heights (New Jersey) Police Department. The case is being prosecuted by Assistant United States Attorney Thomas M. Zaleski.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Philadelphia Congressman and Associates Convicted in Corruption CaseRead the Press Release
A federal jury sitting in Philadelphia found Congressman Chaka Fattah Sr., 59, guilty of all charges against him. Fattah and three of his four associates were found guilty of taking part in a racketeering conspiracy involving several schemes that were intended to further their political and financial interests by misappropriating federal, charitable and campaign funds, among other schemes.
Fattah, Robert Brand, 70, of Philadelphia; Karen Nicholas, 58, of Williamstown, New Jersey; and Herbert Vederman, 70, of Palm Beach, Florida, were found guilty of participating in a racketeering conspiracy. Fattah was also found guilty of conspiracy to commit bribery, bribery, conspiracy to commit wire fraud, conspiracy to commit honest services fraud, mail fraud, money laundering conspiracy, money laundering, bank fraud, false statements to a financial institution, six counts of mail fraud and five counts of falsification of records.
Vederman was also convicted of conspiracy to commit bribery, bribery, bank fraud, making false statements to the Credit Union Mortgage Association, falsification of records and two counts of money laundering.
Brand was also convicted of conspiracy to commit wire fraud.
Nicholas was also convicted of conspiracy to commit wire fraud, two counts of wire fraud and two counts of falsification of records.
Bonnie Bowser, 60, of Philadelphia, was acquitted of racketeering conspiracy but convicted of conspiracy to commit bribery, bank fraud, making false statements to the Credit Union Mortgage Association, falsification of records and money laundering.
U.S. District Court Judge Harvey Bartle III of the Eastern District of Pennsylvania scheduled sentencing hearings for Oct. 4, 2016, for Fattah, Vederman and Brand; and Oct. 5, 2016, for Nicholas and Bowser.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Zane David Memeger of the Eastern District of Pennsylvania, Special Agent in Charge William F. Sweeney Jr. of the FBI’s Philadelphia Division and Special Agent in Charge Akeia Conner of the Internal Revenue Service-Criminal Investigation (IRS-CI) Philadelphia Field Office announced today’s verdict.
“Congressman Fattah corruptly abused his office for his own personal and political gain,” said Assistant Attorney General Caldwell. “He took bribes, committed fraud and even stole money from his own campaigns. In short, Congressman Fattah and his co-defendants deprived the people of eastern Pennsylvania of their right to the honest services of their elected representative. Today’s convictions should send a message that the Justice Department will vigorously investigate and prosecute political corruption wherever it takes place, and uphold the principles of honesty and integrity that are the foundation of our government.”
“Chaka Fattah Sr. and his co-defendants betrayed the public trust and undermined our faith in government,” said U.S. Attorney Memeger. “Today’s verdict makes clear that the citizens of the Eastern District of Pennsylvania expect their public officials to act with honesty and integrity, and to not sell their office for personal gain. Hopefully, our elected officials in Philadelphia and elsewhere hear today’s message loud and clear.”
“The corruption demonstrated by Congressman Fattah and his co-defendants is yet another sad example of the type of behavior that corrodes citizens’ faith in their government,” said Special Agent in Charge Sweeney. “The FBI is firmly committed to ensuring that public officials and their co-conspirators who choose to use their positions for personal gain rather than provide the honest services the community rightly expects will be investigated and brought to justice. The community deserves nothing less.”
“Convictions, like the one returned against these five defendants today, send a loud and clear message that people who willfully defy the law will be fully investigated, prosecuted and subjected to the full punishment of the law for their actions,” said Special Agent in Charge Conner.
According to the evidence presented at trial, Fattah and certain associates borrowed $1 million from a wealthy supporter for his failed 2007 campaign for mayor of Philadelphia, and disguised the funds as a loan to a consulting company. After he lost the election, Fattah returned to the donor $400,000 that the campaign had not used and arranged for Educational Advancement Alliance (EAA), a non-profit entity that Fattah founded and controlled, to repay the remaining $600,000 using charitable and federal grant funds that passed through two other companies, including one run by Brand. To conceal the contribution and repayment scheme, the defendants and others created sham contracts and made false entries in accounting records, tax returns and campaign finance disclosure statements.
Following his defeat, Fattah also sought to extinguish approximately $130,000 in campaign debt owed to a political consultant by agreeing to arrange for the award of federal grant funds to the consultant. Fattah directed the consultant to apply for a $15 million grant (which ultimately he did not receive) on behalf of a then-non-existent non-profit entity. In exchange for Fattah’s efforts to arrange the award, the consultant agreed to forgive the campaign debt.
In addition, Fattah misappropriated funds from his mayoral and congressional campaigns to repay his son’s student loan debt. To execute the scheme, Fattah arranged for his campaigns to make payments to a political consulting company, which funds the company then used to lessen Fattah’s son’s student loan debt. Between 2007 and 2011, the consultant made 34 successful loan payments on behalf of Fattah’s son, totaling approximately $23,000.
Beginning in 2008, Fattah communicated with individuals in the legislative and executive branches in an effort to secure for Vederman an ambassadorship or an appointment to the U.S. Trade Commission. In exchange, Vederman provided money and other items of value to Fattah. As part of this scheme, the defendants sought to conceal an $18,000 bribe payment from Vederman to Fattah by disguising it as a payment for a sham car sale.
Nicholas was found guilty of obtaining $50,000 in federal grant funds that she falsely claimed would be used by EAA to support a conference on higher education. Instead, Nicholas used the grant funds to pay $20,000 to a political consultant, $10,000 to her attorney and write several checks to herself from EAA’s operating account.
The FBI and IRS-CI investigated the case. The Justice Department’s Office of the Inspector General, the NASA Office of Inspector General and the Department of Commerce’s Office of Inspector General. Assistant U.S. Attorney Paul L. Gray of the Eastern District of Pennsylvania and Trial Attorneys Eric L. Gibson and Jonathan Kravis of the Criminal Division’s Public Integrity Section are prosecuting the case.
Philadelphia Congressman and Associates Convicted of RICO Conspiracy in Public Corruption CaseRead the Press Release
PHILADELPHIA – A federal jury today found Congressman Chaka Fattah Sr., 59, guilty of all charges against him. He and three of his four associates were found guilty of taking part in a racketeering conspiracy involving several schemes that were intended to further their political and financial interests by misappropriating federal, charitable and campaign funds, among other schemes. The verdicts were announced today by United States Attorney Zane David Memeger, FBI Special Agent-in-Charge William Sweeney, and IRS Criminal Investigation Special Agent-in-Charge Akeia Conner.
Fattah, Robert Brand, 70, of Philadelphia, Karen Nicholas, 58, of Williamstown, NJ, and Herbert Vederman, 70, of Palm Beach, Florida were found guilty of participating in a racketeering conspiracy. Fattah was also found guilty of conspiracy to commit bribery, bribery, conspiracy to commit wire fraud, conspiracy to commit honest services fraud, mail fraud, money laundering conspiracy, money laundering, bank fraud, false statements to a financial institution, six counts of mail fraud, and five counts of falsification of records.
Herbert Vederman was also convicted of conspiracy to commit bribery, bribery, bank fraud, making false statements to the Credit Union Mortgage Association, falsification of records, and two counts of money laundering.
Robert Brand was also convicted of conspiracy to commit wire fraud.
Karen Nicholas was also convicted of conspiracy to commit wire fraud, two counts of wire fraud, and two counts of falsification of records.
Bonnie Bowser, 60, of Philadelphia, was acquitted of RICO conspiracy but convicted of conspiracy to commit bribery, bank fraud, making false statements to the Credit Union Mortgage Association, falsification of records, and money laundering.
U.S. District Court Judge Harvey Bartle III scheduled sentencing hearings for October 4, 2016 for Fattah, Vederman and Brand; and October 5, 2016 for Nicholas and Bowser.
In connection with his failed 2007 campaign to serve as mayor of Philadelphia, Fattah and certain associates borrowed $1 million from a wealthy supporter, and disguised the funds as a loan to a consulting company. After he lost the election, Fattah returned to the donor $400,000 that the campaign had not used, and arranged for Educational Advancement Alliance (EAA), a non-profit entity that he founded and controlled, to repay the remaining $600,000 using charitable and federal grant funds that passed through two other companies, including one run by Brand. To conceal the contribution and repayment scheme, the defendants and others created sham contracts and made false entries in accounting records, tax returns and campaign finance disclosure statements.
Following his defeat in the mayoral election, Fattah sought to extinguish approximately $130,000 in campaign debt owed to a political consultant by agreeing to arrange for the award of federal grant funds to the consultant. Fattah directed the consultant to apply for a $15 million grant (which ultimately he did not receive) on behalf of a then non-existent non-profit entity. In exchange for Fattah’s efforts to arrange the award of the funds to the non-profit, the consultant agreed to forgive the debt owed by the campaign.
Fattah misappropriated funds from his mayoral and congressional campaigns to repay his son’s student loan debt. To execute the scheme, Fattah arranged for his campaigns to make payments to a political consulting company, which funds the company then used to lessen Fattah’s son’s student loan debt. Between 2007 and 2011, the consultant made 34 successful loan payments on behalf of Fattah’s son, totaling approximately $23,000.
Beginning in 2008, Fattah communicated with individuals in the legislative and executive branches in an effort to secure for Vederman an ambassadorship or an appointment to the United States Trade Commission. In exchange, Vederman provided money and other items of value to Fattah. As part of this scheme, the defendants sought to conceal an $18,000 bribe payment from Vederman to Fattah by disguising it as a payment for a sham car sale.
Karen Nicholas was found guilty of obtaining $50,000 in federal grant funds that she falsely claimed would be used by EAA to support a conference on higher education. The conference never took place. Instead, Nicholas used the grant funds to pay $20,000 to a political consultant, $10,000 to her attorney, and also wrote several checks to herself from EAA's operating account.
“Chaka Fattah Sr. and his co-defendants betrayed the public trust and undermined our faith in government,” said Memeger. “Today’s verdict makes clear that the citizens of the Eastern District of Pennsylvania expect their public officials to act with honesty and integrity, and to not sell their office for personal gain. Hopefully, our elected officials in Philadelphia and elsewhere hear today’s message loud and clear.”
“The corruption demonstrated by Congressman Fattah and his co-defendants is yet another sad example of the type of behavior that corrodes citizens' faith in their government,” said FBI Special Agent- in-Charge William Sweeney. “The FBI is firmly committed to ensuring that public officials and their co-conspirators who choose to use their positions for personal gain rather than provide the honest services the community rightly expects will be investigated and brought to justice. The community deserves nothing less.”
“Convictions, like the one returned against these five defendants today, send a loud and clear message that people who willfully defy the law will be fully investigated, prosecuted, and subjected to the full punishment of the law for their actions,” said Special Agent-in-Charge Akeia Conner, IRS Criminal Investigation.
“Congressman Fattah corruptly abused his office for his own personal and political gain,” said Assistant Attorney General Caldwell. “He took bribes, committed fraud and even stole money from his own campaigns. In short, Congressman Fattah and his codefendants deprived the people of eastern Pennsylvania of their right to the honest services of their elected representative. Today’s convictions should send a message that the Justice Department will vigorously investigate and prosecute political corruption wherever it takes place, and uphold the principles of honesty and integrity that are the foundation of our government.”
This case was investigated by the FBI and IRS-Criminal Investigation. Assistance was provided by the Department of Justice Office of the Inspector General, the NASA Office of Inspector General and the Department of Commerce Office of Inspector General. It is being prosecuted by Assistant U.S. Attorney Paul L. Gray, Trial Attorneys Eric L. Gibson, and Jonathan Kravis of the Criminal Division’s Public Integrity Section.
Pennsylvania Periodontist Indicted for Tax Fraud and Obstructing the IRSRead the Press Release
A federal grand jury sitting in Scranton, Pennsylvania, returned a superseding indictment today, charging a Forty Fort, Pennsylvania periodontist with one count of corruptly endeavoring to obstruct and impede the due administration of the internal revenue laws and two counts of filing false tax returns, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division.
According to the allegations in the superseding indictment, Dr. Charles Musto filed false tax returns with the Internal Revenue Service (IRS) for the years 2008, 2009 and 2010 that underreported gross receipts of his periodontal practice. During these years, Musto, who also owned rental real estate in the area, deposited gross receipts of his periodontal practice into multiple personal bank accounts, but only provided his accountant with the gross receipts that were deposited into the business bank account. Musto also caused his personal expenditures to be falsely classified as business expenses in the books and records of the periodontal practice and the rental real estate business.
If convicted, Musto faces a statutory maximum sentence of three years in prison for each count. He also faces substantial monetary penalties and a term of supervised release.
An indictment merely alleges that crimes have been committed and defendants are presumed innocent until proven guilty beyond a reasonable doubt.
Acting Assistant Attorney General Ciraolo thanked special agents of IRS-Criminal Investigation, who investigated the case, and Trial Attorneys Shawn T. Noud and William Guappone of the Tax Division, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Oklahoma City Man Pleads Guilty to Firearm PossessionRead the Press Release
MUSKOGEE, OKLAHOMA - The United States Attorney’s Office for the Eastern District of Oklahoma announced today that ROBERT LEROY CRAWLEY, age 37, of Oklahoma City, Oklahoma, pled guilty to FELON IN POSSESSION OF FIREARM, in violation of Title 18, United States Code, Sections 922(g)(1), 924(a)(2) and 924(e)(1), punishable by not more than 10 years imprisonment, up to a $250,000 fine or both. However, if it’s determined the defendant has 3 or more felony convictions for violent offenses or serious drug offenses, the punishment will be not less than 15 years imprisonment, a fine up to $250,000.00 or both.
Charges arose from an investigation by the Hugo Police Department and the Federal Bureau of Investigation. The defendant was indicted in April, 2016.
The Indictment alleged that on or about October 20, 2015, within the Eastern District of Oklahoma, the defendant, ROBERT LEROY CRAWLEY, having been convicted of a crime punishable by imprisonment for a term exceeding one year, did knowingly possess in and affecting commerce, a firearm which had been shipped and transported in interstate commerce.
The Honorable Steven P. Shreder, Magistrate Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, accepted the guilty plea and ordered the completion of a presentence report. Sentencing will be scheduled following its completion. The defendant will remain in the custody of the United States Marshals Service pending sentencing.
Assistant United States Attorney Christopher Wilson represented the United States.
Ocean County, New Jersey, Man Admits Robbing Eight BanksRead the Press Release
TRENTON, N.J. – An Ocean County, New Jersey, man today admitted robbing eight banks in New Jersey and New York, U.S. Attorney Paul J. Fishman announced.
Steven Wisnowski, 32, of Barnegat, New Jersey, pleaded guilty before U.S. District Judge Peter J. Sheridan in Trenton federal court to an eight-count superseding information charging him with the bank robberies.
According to documents filed in this case and statements made in court:
Wisnowski admitted that between Oct. 30, 2013 and Jan. 7, 2014, he went on a crime spree and robbed eight banks, seven of which were in New Jersey, and one of which was in New York:
Bank Name
Location
Date
PNC Bank
Edison
Oct. 30, 2013
TD Bank
Brick
Nov. 7, 2013
Santander Bank
Brick
Nov. 15, 2013
Ridgewood Savings Bank
Bayside (NY)
Nov. 22, 2013
Columbia Bank
Edison
Nov. 27, 2013
TD Bank
Toms River
Dec. 2, 2013
PNC Bank
Aberdeen
Dec. 9, 2013
Fulton Bank
Edison
Jan. 7, 2014
Wisnowski used a similar procedure for each robbery: he entered the banks wearing hats, hooded jackets, and wigs to conceal his identity, approached the bank tellers, and demanded money. In some instances, Wisnowski made the tellers believe he was armed and also threatened some tellers with violence.
During the Columbia Bank robbery, Wisnowski appeared to point something at the teller from under his clothing, as if he had a gun. Wisnowski then demanded money, stating: “Give me all your hundreds.” As the teller gathered the money, Wisnowski counted backwards from 10. He then fled with the money.
During the Fulton Bank robbery, Wisnowski gave a teller a manila envelope and stated, “Give me what I want and nobody gets hurt. I want large bills.” He then pulled up his sweatshirt as if he had a gun. The teller gathered the money and placed it in the envelope, after which Wisnowski fled.
Law enforcement tracked Wisnowski’s vehicle to the scene of the Fulton Bank robbery. Officers approached Wisnowski as he exited the bank and ordered him to the ground at gunpoint. Wisnowski threw the envelope filled with cash and fled. Law enforcement officers pursued Wisnowski and apprehended him moments later.
The bank robbery charges to which Wisnowski pleaded guilty each carry a maximum penalty of 20 years in prison and a fine of $250,000. Sentencing is scheduled for Oct. 11, 2016.
U.S. Attorney Fishman praised special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher, with the investigation leading to today’s guilty plea. He also thanked the Edison, Aberdeen, Brick, Toms River, and New York City police departments, and the Middlesex, Ocean, and Monmouth County prosecutors’ offices for their contributions to the case.
The government is represented by Assistant U.S. Attorney Jamari Buxton of the U.S. Attorney’s Organized Crime/Gangs Unit in Newark.
Defense counsel: Chester Keller Esq., Assistant Federal Public Defender, Newark