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6 June 2016
Alfred Man Sentenced to 10 Years for Possessing Child PornographyRead the Press Release
Contact: Craig M. Wolff
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced that Kevin Millette, 44, of Alfred, Maine, was sentenced today in U.S. District Court by Judge Nancy Torresen to 10 years in prison to be followed by seven years of supervised release for possessing child pornography. Millette pleaded guilty to the charge on January 28, 2016. He was also ordered to pay a total of $39,000 in restitution to victims depicted in the images he possessed.
According to court records, in November 2015, agents from Homeland Security Investigations executed a search warrant at Millette’s residence in Alfred. Millette was present, and agreed to be interviewed after waiving his Miranda rights. He admitted that he had accessed child pornography recently using his phone, and estimated that he had thousands of child pornography images on the phone.
Investigators seized three cell phones and a memory card from the residence. One of the phones was in the process of downloading child pornography images when it was seized. A forensic analysis of the phone and its memory card revealed thousands of digital still images depicting children engaging in sexually explicit conduct, as well as a smaller number of child pornography videos. Another memory card was also found to contain child pornography images.
Millette was subject to an enhanced mandatory minimum sentence of 10 years imprisonment because he had a prior child pornography conviction.
The investigation was conducted by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations.
20 People Charged in Methamphetamine and Money Laundering ConspiraciesRead the Press Release
Michael Vincent Woodbury Bent, 37, Dennis Sharkey II, 50, Adam Fullbright, 37, Chris Nauman, 30, John Husemann, 51 all of Dubuque, Iowa, Heather Harris, 37, Zach Miller, 27, and Jacob Burton, 35, all of Waterloo, Iowa, and Edward Behrens, 50, of Benton, Wisconsin, have been charged with one count of conspiracy to distribute methamphetamine. Bent and Fullbright have been charged with an additional count of conspiracy to commit money laundering.
Chad Ellis Weyland, 38, Deis Ray, 40, Jay Seehase, 37, and Kevin Hemmer,41, all of Waterloo, Iowa, have been charged with one count of conspiracy to distribute methamphetamine. Weyland has been charged with an additional count of conspiracy to commit money laundering.
Aldo Omar Lopez Martinez, 22, Adan Sanchez-Chavez, a/k/a Osbaldo Nieto Arreola, a/k/a Osbaldo Martinez Arreola, 25, Roque Rodriguez Arellano, 32, Susana Martinez Arreola, 29, and Michael Corwin, 30, all of Marshalltown, Iowa, and Alejandro Hernandez, 38, and Alfredo Morales, 25, of Des Moines, Iowa, have been charged with one count of conspiracy to distribute methamphetamine. Lopez Martinez, Sanchez-Chavez, and Martinez Arreola have been charged with an additional count of conspiracy to commit money laundering.
The charges are contained in three Indictments filed on May 26, 2016, in United States District Court in Cedar Rapids.
The Indictments allege that, starting as early as the summer of 2013, and continuing until May 2016, the defendants conspired with each other and persons known and unknown to the grand jury to distribute methamphetamine.
If convicted, unless noted below, these individuals face a possible maximum sentence of 20 years’ imprisonment, a $1,000,000 fine, $100 in special assessments, and three years of supervised release following any imprisonment. Weyland, Lopez Martinez, Sanchez-Chavez, Ray, Seehase, Bent, and Sharkey face a mandatory minimum sentence of 10 years’ imprisonment and a possible maximum sentence of life imprisonment, a $10,000,000 fine, $100 in special assessments, and five years of supervised release following any imprisonment.
Weyland, Fullbright, Lopez Martinez, Sanchez-Chavez, Rodriguez Arellano, Martinez Arreola, Hernandez, Morales, Bent, Sharkey, and Behrens appeared on June 3, 2016, in federal court in Cedar Rapids and all were held without bond, except for Rodriguez Arellano and Fullbright. Their next appearance for trial is set for July 18, 2016.
Ray, Hemmer, Harris, and Burton appeared on May 31, 2016. Ray and Burton were held without bond. Harris and Hemmer were released on bond. Their next appearance for trial is set for July 18, 2016. Nauman and Husemann appeared on June 2, 2016. Husemann was released on bond and Nauman was held without bond. Their next appearance for trial is set for July 18, 2016.
Corwin’s, Seehase’s, and Miller’s, first appearance in federal court in Cedar Rapids for an arraignment will be set for a future date.
Weyland, Sharkey, Bent, Behrens, Lopez Martinez, Sanchez-Chavez, Rodriguez Arellano, Martinez Arreola, Morales, and Hernandez were previously arrested via a federal criminal complaint which was executed simultaneously with the execution of 29 federal search warrants across Iowa and in Wisconsin.
As with any criminal case, a charge is merely an accusation and a defendant is presumed innocent until and unless proven guilty.
The case was prosecuted by Assistant United States Attorney Lisa C. Williams and was investigated as part of the Organized Crime Drug Enforcement Task Force (OCDETF) program of the United States Department of Justice through a cooperative effort of Federal Bureau of Investigation, Iowa Division of Narcotics Enforcement, Tri-County Drug Enforcement Task Force (Waterloo Police Department; Cedar Falls Police Department; Waverly Police Department; Bremer County Sheriff’s Office; Black Hawk County Sheriff’s Office; LaPorte City Police Department; Evansdale Police Department; Hudson Police Department), Mid Iowa Drug Task Force (Marshalltown Police Department; Marshall County Sheriff’s Office; Tama County), and Dubuque Drug Task Force (Dubuque Police Department; Dubuque County Sheriff’s Office).
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file numbers are 16-cr-1021, 16-cr-2027, and 16-cr-2028.
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10 Defendants in Drug Trafficking Organization SentencedRead the Press Release
Memphis, TN – Ten defendants in a multi-state narcotics trafficking conspiracy have been collectively sentenced to more than 590 months in federal prison. Edward L. Stanton III, U.S. Attorney for the Western District of Tennessee, announced the sentences today.
According to information presented in court, between August 2014 and June 2015, the defendants conspired with each other to distribute large quantities of oxycodone, methamphetamine, cocaine and marijuana. They utilized the United States Postal Service (USPS) to ship the drugs from Arizona and California to Memphis for distribution.
The defendants and their respective sentences:
• Eddie Caswell aka "Geezy", 35, of Memphis, Tennessee: 200 months
• Armando Penunuri aka "Migo," 29, of Los Angeles, California: 120 months
• Taderrio Johnson aka "Pee-Wee", 29, of Los Angeles, California: 57 months
• Marcus Moore aka "Corry Moore," 33, of Memphis, Tennessee: 18 months
• Martavious Taylor aka "Snap," 32, of Memphis, Tennessee: 60 months
• Tavious Jones aka "Threat" and "No Face, No Case," 23, of Memphis, Tennessee: 57 months
• Brandon Heard, 27, of Memphis, Tennessee: 12 months
• Taquita James, 33, of Memphis, Tennessee: time served
• Brittany Junious aka "Brittany Caswell," 23, of Memphis, Tennessee: 12 months
• Frederick Burton, 52, of Memphis, Tennessee: 60 months
Law enforcement’s investigation into the criminal organization revealed Caswell was the drug trafficking organization’s leader. He recruited family members for his illicit enterprise, including his wife (James) and nephew (Heard).
Initially, Caswell shipped marijuana from Arizona to Memphis. He then expanded his operation after teaming up with Penunuri and Johnson, who served as sources of supply of methamphetamine and prescription pills in California. In February 2015, agents intercepted a package containing more than four kilograms of meth, which Caswell had shipped from California to Memphis.
Over the course of the conspiracy, one of the defendants, Burton, worked as a U.S. Postal Service mail carrier. In collaboration with Caswell, Burton arranged to have express mail packages containing drugs mailed to addresses on his mail route. In exchange for cash, Burton would divert those packages to members of the drug trafficking organization. Law enforcement investigators captured surveillance on over two dozen instances which showed Burton diverting packages to persons off of his assigned postal route. A conservative estimate revealed that Burton distributed over 800 kilograms of marijuana and oxycodone.
In May 2015, all of the defendants were indicted on a multi-count indictment, which charged them with conspiracy to possess with the intent to distribute and to distribute multiple narcotics.
All 10 defendants pleaded guilty to charges within the indictment in February 2016.
In May 2016, they all were sentenced by U.S. District Judge Sheryl Lipman to federal imprisonment, excluding Taquita James, who received time served.
This case was investigated by the Drug Enforcement Administration (DEA), U.S. Postal Inspector, and the U.S. Postal Service Office of Inspector General.
Assistant U.S. Attorney Reagan M. Taylor prosecuted this case on the government’s behalf.
5 June 2016
Wisconsin Man Charged with Aggravated Sexual Abuse of a Child and Abusive Sexual Contact of a ChildRead the Press Release
United States Attorney Randolph J. Seiler announced that a Milwaukee, Wisconsin, man has been indicted by a federal grand jury for Aggravated Sexual Abuse of a Child and Abusive Sexual Contact of a Child.
Dashown Raymond Keys, age 24, was indicted on April 13, 2016. He appeared before U.S. Magistrate Judge William D. Gerdes on May 31, 2016, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to life in custody and/or a $1,250,000 fine, up to life of supervised release, and $500 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that between November 1, 2013, and September 6, 2015, Keys knowingly engaged in and attempted to engage in sexual acts with a female who had not attained the age of 12 years.
The charges are merely accusations and Keys is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Federal Bureau of Investigation. Assistant U.S. Attorney Troy R. Morley is prosecuting the case.
Keys was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
White River Man Charged with Conspiracy to Distribute MethamphetamineRead the Press Release
United States Attorney Randolph J. Seiler announced that a White River, South Dakota, man has been indicted by a federal grand jury for Conspiracy to Distribute a Controlled Substance.
Stephan George Jones, a/k/a Stephen George Jones, age 45, was indicted on May 17, 2016. He appeared before U.S. Magistrate Judge Mark A. Moreno on May 31, 2016, and pled not guilty to the Indictment.
The penalty upon conviction is 10 years up to life in custody and/or a $10,000,000 fine, five years up to life of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
It is alleged that between September 1, 2013, and May 17, 2016, Jones conspired to distribute 500 grams or more of methamphetamine in the District of South Dakota.
The charge is merely an accusation and Jones is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Rosebud Sioux Tribe Law Enforcement Services, the Federal Bureau of Investigation, and the Northern Plains Safe Trails Drug Enforcement Task Force. Assistant U.S. Attorney SaraBeth Donovan is prosecuting the case.
Jones was released on bond pending trial. A trial date has not been set.
Sioux Falls Man Charged with Failure to Register as a Sex OffenderRead the Press Release
United States Attorney Randolph J. Seiler announced that a Sioux Falls, South Dakota, man has been indicted by a federal grand jury for Failure to Register as a Sex Offender.
David George Flute, III, age 26, was indicted on May 17, 2016. He appeared before U.S. Magistrate Judge Mark A. Moreno on May 26, 2016, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in custody and/or a $250,000 fine, at least 5 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that Flute, a person required to register under the Sex Offender Registration and Notification Act, and a sex offender by reason of a conviction under federal law, knowingly failed to register and update his registration.
The charge is merely an accusation and Flute is presumed innocent until and unless proven guilty.
The investigation is being conducted by the U.S. Marshals Service. Assistant U.S. Attorney Meghan N. Dilges is prosecuting the case.
Flute was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
Rosebud Man Charged with Conspiracy to Distribute MethamphetamineRead the Press Release
United States Attorney Randolph J. Seiler announced that a Rosebud, South Dakota, man has been indicted by a federal grand jury for Conspiracy to Distribute a Controlled Substance, two counts of Possession with Intent to Distribute a Controlled Substance, and Possession of a Firearm by a Prohibited Person.
Benjamin Young, a/k/a Benjamin Two Eagle, age 34, was indicted on May 17, 2016. He appeared before U.S. Magistrate Judge Mark A. Moreno on May 26, 2016, and pled not guilty to the Indictment.
The maximum penalty upon conviction of the three drug charges is up to 20 years in custody and/or a $1,000,000 fine, three years of supervised release, and $100 to the Federal Crime Victims Fund for each charge. The maximum penalty upon conviction of the firearm charge is up to 10 years in custody and/or a $250,000 fine, three years of supervised release, and $100 to the Federal Crime Victims Fund for each charge. Restitution may also be ordered.
It is alleged that between January 1, 2015, and May 17, 2016, Young conspired with others to distribute methamphetamine, and that on September 19, 2015, and September 23, 2015, Young possessed methamphetamine with the intent to distribute it. It is also alleged that on September 23, 2015, while being an unlawful user of a controlled substance, Young possessed a firearm in violation of federal law.
The charge is merely an accusation and Young is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Rosebud Sioux Tribe Law Enforcement Services and the Northern Plains Safe Trails Drug Enforcement Task Force. Assistant U.S. Attorney SaraBeth Donovan is prosecuting the case.
Young was released on bond pending trial. A trial date has not been set.
Rapid City Woman Indicted for Health Care Fraud and Identity TheftRead the Press Release
United States Attorney Randolph J. Seiler announced that a Rapid City, South Dakota, woman has been indicted by a federal grand jury for False Statements Relating to Health Care Matters, Aggravated Identity Theft, Health Care Fraud, and Obtaining or Attempting to Obtain Controlled Substances by Fraud.
Tiffany Mills, age 43, was indicted on May 24, 2016. Mills appeared before U.S. Magistrate Judge Daneta Wollmann on May 27, 2016, and pleaded not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in custody and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The charges relate to Mills using the identifications of other people to obtain prescriptions of controlled substances in South Dakota between June and October of 2014.
The charges are merely accusations and Mills is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Department of Health and Human Services, Office of Inspector General. Assistant U.S. Attorney Megan Poppen is prosecuting the case.
Mills was released on bond pending trial. A trial date has been set for August 2, 2016.
Mission Man Sentenced for Assault with a Dangerous Weapon and Aiding and AbettingRead the Press Release
United States Attorney Randolph J. Seiler announced that a Mission, South Dakota, man convicted of Assault with a Dangerous Weapon and Aiding and Abetting was sentenced on June 1, 2016, by U.S. District Judge Roberto A. Lange.
James Dean Iron Ring, age 25, was sentenced to 19 months in custody, 2 years of supervised release, $100 to the Federal Crime Victims Fund, and $661.25 in restitution.
On May 12, 2015, Iron Ring was indicted by Superseding Indictment for Discharge of a Firearm During Crime of Violence, and five counts of Assault with a Dangerous Weapon and Aiding and Abetting. He pled guilty on March 14, 2016, to one count of Assault with a Dangerous Weapon and Aiding and Abetting.
On the evening of February 27, 2015, Iron Ring drove to Sunrise Apartments in Mission, with Richard Fool Bull and a juvenile. Iron Ring and the juvenile remained in the vehicle while Fool Bull approached the apartment. Fool Bull stood outside of the apartment and discharged a firearm eight times into the apartment. Iron Ring then drove Fool Bull and the juvenile away from the apartments.
Five individuals were inside of the apartment at the time of the shooting. One of the bullets grazed one victim’s arm.
Previously, Fool Bull pled guilty to two counts of Assault with a Dangerous Weapon and Aiding and Abetting, one count of Prohibited Person in Possession of Ammunition, and two counts of Failure to Register as a Sex Offender. On March 28, 2016, Fool Bull was sentenced to 117 months in custody, 5 years of supervised release, $500 in special assessments to the Federal Crime Victims Fund, and $661.25 in restitution.
This case was investigated by the U.S. Marshals Service and Rosebud Sioux Tribal Law Enforcement Services. Assistant U.S. Attorney Carrie G. Sanderson prosecuted the case.
Iron Ring was immediately turned over to the custody of the U.S. Marshals Service.
Mission Man Charged with Assaulting a Federal OfficerRead the Press Release
United States Attorney Randolph J. Seiler announced that a Mission, South Dakota, man has been indicted by a federal grand jury for Assaulting, Opposing, Resisting, and Impeding a Federal Officer.
Richard Joseph One Feather, age 46, was indicted on April 13, 2016. He appeared before U.S. Magistrate Judge Mark A. Moreno on May 26, 2016, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to eight years in custody and/or a $250,000 fine, three years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
It is alleged that on March 29, 2016, One Feather assaulted a federal officer involving physical contact after an attempted traffic stop.
The charge is merely an accusation and One Feather is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Rosebud Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Kirk W. Albertson is prosecuting the case.
One Feather was released on bond pending trial. A trial date has not been set.
Huron Man Charged with Simple AssaultRead the Press Release
United States Attorney Randolph J. Seiler announced that a Huron, South Dakota, man has been charged by Complaint for Simple Assault.
James Christopher Wahl, a/k/a Kris Casanova, age 27, was charged on April 29, 2016. He appeared before U.S. Magistrate Judge Mark A. Moreno on May 27, 2016, and pled not guilty to the Complaint.
The maximum penalty upon conviction is up to 6 months in custody and/or a $5,000 fine, 1 year of supervised release, and $10 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Complaint alleges that on or about April 4, 2016, Wahl, a non-Indian, unlawfully assaulted a female acquaintance who is a tribal member, and said assault, which occurred on the reservation, constituted Simple Assault.
The charge is merely an accusation and Wahl is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Bureau of Indian Affairs, Crow Creek Agency. Assistant U.S. Attorney Meghan N. Dilges is prosecuting the case.
Wahl was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
3 June 2016
“Your Future, Your Decision” Program Offered to 7th Grade Students in TauntonRead the Press Release
TAUNTON – United States Attorney Carmen Ortiz, in partnership with Taunton Public Schools and the Bristol County District Attorney’s Office, will present a powerful youth violence prevention event for approximately 650 middle school students at 9:00 a.m. on Wednesday, June 8, 2016, at Taunton High and Parker Middle Schools.
U.S. Attorney Ortiz will offer remarks, along with District Attorney Thomas Quinn, Taunton Mayor Thomas Hoye, Taunton Police Chief Edward Walsh, and other special guests.
“Your Future, Your Decision,” is a half-day in-school program which has been presented to nearly 6,000 middle school students statewide. The program emphasizes the importance of making good decisions, especially when young people face choices that could lead to gang activity, guns, drugs and bullying, and more. Following the speaking presentations, students will attend a resource fair featuring local organizations offering after school and summer programming.
“It is extremely important that we get the message to young people that it is not too early to start thinking about the decisions they make and how their choices can impact the rest of their lives,” said United States Attorney Carmen M. Ortiz. “Many outside factors influence youth, and it is critical that we arm them with the tools to confront difficult decisions as early as possible. It is our hope that the ‘Your Future, Your Decision’ program will give young people the skills and confidence they need to make good choices throughout their teenage years.”
Woman Who Sold Guns, Drugs and Fake Grenade Sentenced to PrisonRead the Press Release
ALEXANDRIA, Va. – Maria Del Carmen Flores Beltran, 43, of Stephenson, was sentenced today to 60 months in prison for selling over 400 grams of cocaine and a dozen firearms, ammunition and a fake grenade to ATF agents in 2015.
Flores Beltran pleaded guilty on February 17. According to court documents, in June 2015, ATF identified Flores Beltran, who is an illegal alien from El Salvador, as a potential cocaine distributor. From July 2015 to December 2015, ATF agents carried out 13 controlled buys from Flores Beltran, purchasing a total of approximately 402 grams of cocaine. ATF agents also purchased 12 firearms, various types of ammunition, and a hoax grenade. The firearms sold by Flores Beltran included two rifles, three shotguns (one modified with a shortened barrel and stock), four semi-automatic handguns, two revolvers, and an M1-style .30 caliber pistol with a high capacity magazine. On multiple occasions, Flores Beltran sold cocaine and firearms together during the same transaction.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia, and Michael Boxler, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division, made the announcement after sentencing by U.S. District Judge Claude M. Hilton. Assistant U.S. Attorney J. Tyler McGaughey prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-40.
Whittier, N.C. Man Sentenced to More Than 12 Years in Prison on Child Pornography ChargesRead the Press Release
ASHEVILLE, N.C. – U.S. District Judge Martin Reidinger sentenced today John Michael Awtrey, 56, of Whittier, N.C., to 150 months in prison on child pornography charges, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Awtrey was also sentenced to a lifetime of supervised release and was ordered to register as a sex offender.
U.S. Attorney Rose is joined in making today’s announcement by Nick Annan, Special Agent in Charge of ICE/Homeland Security Investigations (HSI) in Georgia and the Carolinas, Sheriff Curtis A. Cochran of the Swain County Sheriff’s Office and Sheriff Derrick Palmer of the Cherokee County Sheriff’s Office.
According to filed documents and statements made in court, on or about February 24, 2013, law enforcement became aware that an individual, later identified as Awtrey, was accessing child pornography online using the Internet profile of “iamnice.” Law enforcement executed a search warrant at Awtrey’s residence and seized approximately one dozen computers and various electronic devises and storage media. According to court records, forensic analysis of the seized devices and equipment revealed that Awtrey possessed hundreds of thousands of images and videos involving minors engaging in sexually explicit conduct, including material involving prepubescent minors and sadistic and masochistic conduct. Court records indicate that Awtrey used the Internet to send some of those images to other individuals and to receive child pornography.
In August 2015, following a bench trial, Judge Reidinger found Awtrey guilty of one count of distribution, one count of receipt and one count of possession of child pornography.
Awtrey is currently in custody and will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility. Federal sentences are served without the possibility of parole.
The investigation was handled by HIS, the Swain County Sheriff’s Office and the Cherokee County Sheriff’s Office. The U.S. Attorney’s Office in Asheville prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in 2006 by the Department of Justice, aimed at combating the growing online sexual exploitation of children. By combining resources, federal, state and local agencies are better able to locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue those victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Two Arrested for Nationwide Casino and Credit Card Fraud SchemeRead the Press Release
SACRAMENTO, Calif. — A federal grand jury returned a nine-count indictment Thursday against Vivian Wang, 53, of Lilburn, Georgia, and Frank Luo, 48, of Las Vegas, Nevada, charging them both with wire fraud and charging Wang with aggravated identity theft, Acting United States Attorney Phillip A. Talbert announced. The defendants were arrested today at their residences in Georgia and Nevada.
According to court documents, between August 5, 2008 and August 2014, Wang and Luo participated in a scheme to defraud casinos and credit card companies across the country. The scheme involved using false identities in the names and Social Security numbers of migrant workers to apply for casino credit called “markers” and to open credit card accounts. A marker is a cash advance provided by a casino to a patron, and it is often secured by a check from the patron’s bank account. The defendants initially timely repaid several markers at different casinos and several credit cards in order to give the impression of creditworthiness to future casinos and credit card companies. Moreover, the defendants coordinated their gambling activity in order to give the appearance of losing money (and thereby encouraging the casinos to issue future markers) when in fact one schemer would “lose” money while another would gain the same. In other instances, one schemer would surreptitiously deliver the issued gambling chips to another in order to give the appearance of having spent them.
According to the indictment, the defendants expended the fraudulently obtained credit on jewelry, precious metals, home appliances, international flights, luxury goods and clothing. The defendants closed and depleted the bank accounts provided to the casinos in their marker applications to prevent the casinos from recovering the money secured by the checks they had written against those accounts, and they did not pay back the credit card balances. The combined fraud led to over $1.2 million in losses to casinos and credit card companies.
This case is the product of an investigation by the Federal Bureau of Investigation and the California Department of Justice's Bureau of Gambling Control. Assistant United States Attorney Matthew M. Yelovich is prosecuting the case.
If convicted, Wang and Luo face a maximum statutory penalty of 20 years in prison and a $250,000 fine as to each count of wire fraud. If convicted of aggravated identity theft, Wang faces a mandatory minimum sentence of 24 months in prison consecutive to any other sentence imposed. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
Two Additional Defendants Arraigned in Connection with Drug Smuggling at Montana State PrisonRead the Press Release
MISSOULA – Rachel Leanna Ross, 25, of Collierville Tennessee, and Lauren J. Hoskins, 26, of Somerville, Tennessee, were arraigned in federal court yesterday on a six-count superseding indictment charging them with various drug distribution crimes.
Ross and Hoskins were the fourth and fifth defendants to be arraigned under the indictment. Three other defendants were arraigned on Tuesday and an additional defendant was arraigned last month under a separate indictment. Both Ross and Hoskins were arraigned on charges of conspiracy to possess with intent to distribute a controlled substance and possession with intent to distribute a controlled substance.
The superseding indictment is the result of an investigation into drug smuggling at the Montana State Prison. The investigation was a cooperative effort between the Federal Bureau of Investigation, the United States Postal Inspector, the Montana Department of Corrections Investigations Division, Montana State Prison Warden Leroy Kirkegard and his staff, and the Montana Division of Criminal Investigations.
An indictment is simply a charging document that initiates formal court proceedings. Ross and Hoskins are presumed innocent of the charges in the superseding indictment unless and until they are found guilty beyond a reasonable doubt at trial.
Turlock Man Pleads Guilty to Conspiracy to File False Claims in Prison Tax Fraud SchemeRead the Press Release
SACRAMENTO, Calif. — Daniel Allen Coats, 34, of Turlock, pleaded guilty today to one count of conspiracy to defraud the United States by filing false claims for federal tax refunds, Acting United States Attorney Phillip A. Talbert announced.
According to court documents, beginning in 2011, Coats and three fellow inmates in the California Correctional Center in Susanville obtained the personal identification information of other inmates and provided it to co-defendants located outside the prison. The co-defendants then used that information to prepare and file false income tax returns with the Internal Revenue Service, claiming refunds to which the inmates were not entitled. Coats also filed three false tax returns in his own name.
According to court documents, the fraudulently obtained refund checks were deposited into various bank accounts and onto prepaid debit cards that the defendants controlled. The refunds were used for personal expenditures, added to the inmates’ commissary accounts, and used to purchase prepaid debit cards. In all, the conspiracy resulted in at least 247 false claims for income tax returns in tax years 2008 through 2011. Although the IRS stopped some of these refunds, approximately 138 fraudulent refunds totaling approximately $219,984 were issued.
This case is the product of an investigation by the Internal Revenue Service, Criminal Investigation, the Federal Bureau of Investigation, and the Investigative Unit at the California Correctional Center. Assistant United States Attorney Amy Schuller Hitchcock is prosecuting the case.
Coats is scheduled to be sentenced by United States District Judge Garland E. Burrell Jr. on August 19, 2016. Coats faces a maximum statutory penalty of 10 years in prison and a $250,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
On July 8, 2015, Edwin Ludwig IV was sentenced to seven years in prison for his role in the scheme. The charges against the remaining five co-defendants are pending. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
Trial Team Honored by Department of Justice at Executive Office for United States Attorneys Director's Awards CeremonyRead the Press Release
Deputy AG Sally Yates, EOUSA Director Monty Wilkinson recognize select employees at event in Washington, D.C.
WASHINGTON – An Assistant U.S. Attorney with the Southern District of Mississippi along with two DOJ Civil Rights Division attorneys, a DOJ Civil Rights Division Paralegal, and two FBI agents were among 160 recipients recognized by Deputy Attorney General Sally Yates and Executive Office for U.S. Attorneys (EOUSA) Director Monty Wilkinson at the 32nd annual Director’s Awards Ceremony held in Washington D.C. on June 1, 2016.
The Southern District of Mississippi was one of 33 districts represented at the ceremony which was held in the Great Hall at the Robert F. Kennedy Department of Justice Building.
In her prepared remarks, Deputy Attorney General Yates said, “The achievements being recognized today reflect the breadth of the department’s responsibilities, and some of our most significant challenges. From dismantling dangerous gangs, drug cartels and human trafficking operations to tackling political corruption, white collar crimes, and international terrorism, these awardees have taken on our toughest cases. And the citizens of our country are safer because of their work.”
“We honor the truly talented and dedicated legal and administrative personnel in the 94 U.S. Attorneys’ offices and our law enforcement partners who everyday touch lives in our communities, protect the American people, and work to ensure the fair and impartial administration of justice,” said Director Wilkinson.
The award for “Superior Performance by a Litigative Team” was given to Assistant U.S. Attorney Glenda R. Haynes, DOJ Trial Attorney Sheldon L. Beer, Deputy Chief Paige M. Fitzgerald of the DOJ Civil Rights Division, Paralegal Specialist Steven Harrell of the DOJ Civil Rights Division, FBI Agent Bradley Hentschel, and FBI Agent Robert H. Ruby for their hard work on U.S v. Dedmon case.
The Dedmon case was a federal hate crime case involving an assault which culminated in the death of James Craig Anderson, an African-American man, in the summer of 2011. The case was historic as it marked the first time that the Matthew Shepard and James Byrd, Jr. Hate Crimes Prevention Act had been used in a case where the defendants’ actions resulted in a victim’s death.
“We are pleased that the U.S. Department of Justice has recognized this trial team for their outstanding contribution to the Department and its mission,” said U.S. Attorney Davis.
EOUSA provides oversight, general executive assistance, and direction to the 94 United States Attorneys’ offices around the country. For more information on EOUSA and its mission, visit http://www.justice.gov/usao.Three indicted for $634,000 health care fraud involving two Toledo companiesRead the Press Release
Three people were indicted in federal court for their roles in a $634,000 health care fraud scheme involving two ambulette companies they operated and fraudulent billing of the Ohio Medicaid program, said Carole S. Rendon, Acting U.S. Attorney for the Northern District of Ohio.
Named in the six-count indictment are: Yahya Sayid Ibrahim, 34, of Toledo; Abdul Haji Faqi, 40, of Canal Winchester, and Hussein Ahmed, 45, of Toledo.
The indictment charges Ibrahim, Faqi and Ahmed with a conspiracy to commit health care fraud through the operation of two Toledo companies, Blue Line Express Taxi and Medical Transport and Metro Medical Transportation, LLC. The indictment also charges the defendants with five substantive counts of health care fraud related to Medicaid benefits for conduct that took place between 2009 and 2016.
The defendants transported – and billed for -- Medicaid recipients that did not need wheelchairs, understanding Medicaid only provided reimbursement for recipients who required the assistance of wheelchairs and were actually transported in wheelchairs. They also billed Medicaid for ambulette transportation services (vans with lifts for wheelchairs) when they were actually transporting people in vehicles that were not ambulettes, such as Toyota Camrys, according to the indictment
If convicted, the defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The investigating agencies in this case are Health and Human Services Office of Inspector General, the Ohio Attorney General’s Medicaid Frauds Control Unit and the Federal Bureau of Investigation in Toledo. The case is being handled by Assistant United States Attorneys Noah P. Hood and Gene Crawford.
An indictment is only a charge and is not evidence of guilt. Defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Sullivan County Man Pleads Guilty in White Plains Federal Court to Distribution of Heroin and Fentanyl Causing the Death of an IndividualRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that TERRENCE JOHNSON, 23, of Sullivan County, pled guilty to distributing a mixture of heroin and fentanyl that resulted in the overdose death of Malcolm Perry, 35, a resident of Liberty, New York. JOHNSON also pled guilty to multiple additional counts of distributing heroin and fentanyl, distributing cocaine, conspiring to distribute at least 100 grams of heroin, and conspiring to distribute at least 280 grams of crack cocaine. The charges to which JOHNSON pled guilty are set forth in a ten-count superseding indictment (the “Indictment”), which was filed in April 2016. JOHNSON pled guilty to the Indictment today before U.S. Magistrate Judge Paul E. Davison. The case is assigned to U.S. District Judge Cathy Seibel.
U.S. Attorney Bharara stated: “As he admitted today in court, Terrence Johnson sold a deadly mixture of heroin and fentanyl in Sullivan County on multiple occasions, one of which resulted in the tragic overdose death of Malcolm Perry. Heroin abuse – on the rise along with prescription painkiller abuse – is causing too many deaths and destroying too many communities.”
According to the allegations in the Indictment and other information in the public record:
On multiple occasions between May 28, 2015, and June 6, 2015, JOHNSON sold heroin mixed with fentanyl in Sullivan County. Fentanyl is a synthetic opioid that is significantly stronger than both ordinary heroin and morphine. Several customers who purchased that dangerous mixture from JOHNSON overdosed and required emergency medical attention. On or about June 1, 2015, Malcolm Perry overdosed and died of acute fentanyl intoxication as a result of using drugs sold by JOHNSON. As a consequence of committing the offense of distributing a controlled substance that resulted in death, as charged in Count Four of the Indictment, JOHNSON faces a mandatory minimum sentence of 20 years in prison, and a maximum sentence of life in prison.
JOHNSON also pled guilty to multiple additional counts of distributing and possessing with intent to distribute heroin and fentanyl (Counts One through Three, Seven, and Eight); one count of distributing and possessing with intent to distribute heroin and fentanyl within 1,000 feet of an elementary school (Count Six); one count of distributing and possessing with intent to distribute cocaine within 1,000 feet of an elementary school (Count Five); one count of conspiring to distribute 100 grams or more of heroin (Count Nine); and one count of conspiring to distribute 280 grams or more of crack cocaine (Count Ten).
A chart summarizing the counts to which JOHNSON pled guilty and the maximum penalties for each count is set forth below. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as the sentencing of the defendant will be determined by the judge.
JOHNSON is scheduled to be sentenced on September 12, 2016, at 2:30 p.m., before Judge Seibel.
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Mr. Bharara praised the outstanding investigative work of the FBI, the Village of Liberty Police Department, the New York State Police, the Sullivan County Sheriff’s Department, and the Village of Monticello Police Department. Mr. Bharara also thanked the Sullivan County District Attorney’s Office for its assistance in the case.
The prosecution is being handled by the Office’s White Plains Division. Assistant U.S. Attorneys Anden Chow, Michael Gerber, and George Turner are in charge of the prosecution.
CHARGE
MAXIMUM PENALTY
Counts One, Two, Three, Seven, and Eight
Distribution and possession with intent to distribute controlled substances, in violation of Title 21, United States Code, Sections 812, 841(a)(1), and 841(b)(1)(C)
20 years in prison for each count
Counts Five and Six
Distribution and possession with intent to distribute controlled substances within one thousand feet of the real property comprising a public or private elementary school, in violation of Title 21, United States Code, Sections 812, 841(a)(1), 841(b)(1)(C), and 860
40 years in prison for each count
Mandatory minimum: One year in prison for each count
Count Four
Distribution of controlled substances resulting in death, in violation of Title 21, United States Code, Sections 812, 841(a)(1), and 841(b)(1)(C)
Life in prison
Mandatory minimum: 20 years in prison
Count Nine
Conspiracy to distribute and possess with intent to distribute 100 grams or more of heroin, in violation of Title 21, United States Code, Section 846
40 years in prison
Mandatory minimum: Five years in prison
Count Ten
Conspiracy to distribute and possess with intent to distribute 280 grams or more of crack cocaine, in violation of Title 21, United States Code, Section 846
Life in prison
Mandatory minimum: Ten years in prison
Six Time Convicted Felon from Selma Receives Mandatory 15-Year Sentence for Being an Armed Career CriminalRead the Press Release
United States Attorney Kenyen R. Brown of the Southern District of Alabama announces that United States District Judge Kristi K. DuBose sentenced Maurice Odell Brown, age 38, of Selma, Alabama, a six-time convicted felon, to serve the statutory mandatory sentence of 15 years in prison followed by 5 years of supervised release for being an armed career criminal. In addition, Brown was sentenced to 8 months, to be served consecutively to the 15 year sentence, for violating his federal supervised release term; for a total sentence of 188 months. In February 2016, Brown was convicted by a jury of being a felon in possession of a firearm. The 15-year sentence was due to Brown’s extensive criminal history which included: three State of Alabama convictions for two burglaries and an aggravated assault, a federal conviction in Louisiana for being an accessory after the fact (in connection with a kidnapping and carjacking), and two separate federal convictions in this district for being a felon in possession of a firearm.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives in Mobile, Alabama, the 4th Judicial Task Force of the Selma District Attorney’s Office, and the Alabama Attorney General’s Office. The case was prosecuted by Donna B. Dobbins and Lawrence J. Bullard, Assistant United States Attorneys with the United States Attorney’s Office for the Southern District of Alabama.Seven people indicted related to ring that trafficked minors in Lima and Fort WayneRead the Press Release
Five people were indicted in federal court on human trafficking charges for their roles in conspiracies in which girls, then 14 and 16 years old, were forced into commercial sex acts, said Acting U.S. Attorney Carole S. Rendon, Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland Office, and Lima Police Chief Kevin Martin.
Named in the 15-count indictment are: Megan Hitt, 28; Lorenzo Young, 30, Randy Thompson, 26; Aundre Davis, 34, and Precious Russell, 19.
Two other people -- Shemeric Cook, 29, and Jacqueline Young, 53 -- face charges related to obstructing the investigation.
All the defendants are from Lima, Ohio, except for Hitt, who is from Fort Wayne, Indiana.
The charges include conspiracy to engage in sex trafficking of a minor, transportation of a minor with intent to engage in prostitution, sex trafficking of a minor, obstruction of a sex trafficking investigation, conspiracy to obstruct a sex trafficking investigation and participation in a child exploitation enterprise.
One conspiracy involves Hitt, Young, Thompson and Davis, and took place between November 2015 and January 2016, in which the four conspired to cause girls, aged 14 and 16, to engage in commercial sex acts in Lima and Fort Wayne. They did this by taking and posting sexually explicit photos of the girls on backpage.com, transporting the girls, renting motel rooms for them and negotiating prices, according to the indictment.
Another conspiracy involves Thompson and Russell and took place in November and December 2015 when they caused the then-14-year-old girl to engage in commercial sex acts in Lima. Thompson would receive 50 percent of money paid by the girl’s customers, Russell would receive 25 percent of the money and the girl could keep the remaining 25 percent, according to the indictment.
“This indictment is yet another reminder that human trafficking is all around us,” Rendon said. “It flourishes in plain sight, on the internet and in the motels in our towns. The conduct these defendants engaged in is reprehensible, and they will now be held accountable.”
“These individuals violated the rights of some of our most vulnerable in our community - the children,” Anthony said. “The FBI will continue working with our law enforcement partners to aggressively pursue justice for human trafficking victims and to put their perpetrators behind bars."
“Human trafficking is a devastating crime that must be stopped. It victimizes people within every segment of society throughout our nation,” Martin said. “I want to thank the FBI and U.S. Attorney’s Office for their help in enforcing the law against those who will engage in human trafficking within the Lima community. We are grateful for the cooperative working relationship we have with them and the many other local, state and federal law enforcement agencies that are working together to make human trafficking a thing of the past. The Lima Police Department cannot accomplish this alone.”
If convicted, the defendant’s sentence will be determined by the court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case was investigated by the Federal Bureau of Investigation’s Toledo office and the Lima Police Department. It is being prosecuted by Assistant U.S. Attorneys Alissa M. Sterling, and Daniel R. Hurley.
An indictment is only a charge and is not evidence of guilt. Defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Sentencings for May 26 - June 1, 2016Read the Press Release
Randolph Paul Duran, 27, of Ethete, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on June 1, 2016, on two counts of sexual abuse. Duran was arrested in Riverton, Wyoming. He received 63 months imprisonment, to be followed by 10 years of supervised release, and was ordered to pay a $200.00 special assessment. This case was investigated by the Federal Bureau of Investigation.
Andrew Lee Pino, 33, of Casper, Wyoming, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on May 31, 2016, for being a felon in possession of a firearm. Pino was arrested in Casper, Wyoming. He received 48 months imprisonment, to be followed by three years of supervised release, and was ordered to pay a $400.00 fine and a $100.00 special assessment. This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Craig Alan Demeulenaere, 62, of Victor, Idaho, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on May 26, 2016, for possession with intent to distribute at least 500 grams of a mixture or substance containing a detectable amount of methamphetamine. Demeulenaere was arrested in Hillsboro, Oregon. He received 97 months imprisonment, to be followed by five years of supervised release, and was ordered to pay a $100.00 special assessment and restitution in the amount of $900.00. This case was investigated by the Wyoming Division of Criminal Investigation.
San Jose Resident Sentenced to A Year in Custody for Damaging Computers of Silicon Valley CompanyRead the Press Release
SAN JOSE – Robert Saunders was sentenced to twelve months in prison and ordered to pay $124,003.79 in restitution for attacking a corporate computer network, announced United States Attorney Brian J. Stretch and FBI Special Agent in Charge John F. Bennett.
Saunders, 30, of San Jose, pleaded guilty on February 24, 2016, to one count of intentional damage to a protected computer. As part of his plea agreement, Saunders admitted he intentionally accessed the computer network of a Silicon Valley corporation based in San Mateo that provides integrated business management solutions over a web-based architecture. On numerous occasions between July 26, 2012, and August 31, 2012, Saunders accessed the computer network of the publicly-traded corporation without authorization and caused losses with an aggregate value of approximately $189,000.
Saunders admitted that on one occasion he changed information for a demonstration account belonging to a retail business customer of the corporation and that his actions prevented potential customers from accessing the test account. On other occasions, Saunders obtained information through his unlawful access to a database and posted offensive content in the corporation’s test account. The corporation incurred approximately $189,000 in costs responding to the offense and restoring its systems.
Saunders was originally indicted by a federal grand jury on April 30, 2014. A Second Superseding Indictment was filed on February 24, 2016, charging him with one count of Intentional Damage to a Protected Computer, in violation of 18 U.S.C. § 1030(a)(5)(A) and (c)(4)(B)(i); four counts of Obtaining Information from a Protected Computer without Authorization, in violation of 18 U.S.C. § 1030(a)(2)(C) and (c)(2)(B)(i); and two counts of Possession of a Firearm in Interstate Commerce while Unlawfully Using A Controlled Substance, in violation of 18 U.S.C. § 922(g)(3). Pursuant to his plea agreement, he pleaded guilty to the intentional damage to a protected computer charge.The sentence was handed down by the Honorable Lucy H. Koh, U.S. District Judge on June 1, 2016. Judge Koh also sentenced the defendant to a three-year period of supervised release and ordered him to forfeit property seized during the execution of a search warrant at his apartment, including computer equipment used to facilitate the offense. FBI agents arrested the defendant on May 8, 2014, in Portland, Oregon. On September 12, 2014, he was ordered released on bond and remains out of custody. The defendant will begin serving the sentence on July 29, 2016.
Assistant U.S. Attorneys Michelle J. Kane and Susan Knight are prosecuting the case with the assistance of Melissa Dorton and Elise Etter. The prosecution is the result of an investigation by the Federal Bureau of Investigation.
Safe Streets Task Force Investigation Results in Six-Year Prison Sentence for Pittsburgh ManRead the Press Release
PITTSBURGH – An Allegheny County resident has been sentenced in federal court to 72 months’ imprisonment on his conviction of conspiracy to distribute cocaine, United States Attorney David J. Hickton announced today.
United States District Judge Mark R. Hornak imposed the sentence on Devonte White, 23, of Pittsburgh, PA.
According to information presented to the court, in 2013, the Federal Bureau of Investigation and other agencies joined forces in a multi-agency wiretap investigation of drug trafficking and violence in the Homewood section of Pittsburgh. The interception of wire and electronic communications began in December 2013 and continued through the end of August 2014. During that timeframe, Devonte White was intercepted over the wire conspiring with others to possess with intent to distribute and distribute cocaine, which was shipped from California to the Western District of Pennsylvania through the United States Postal Service or commercial carrier.
Prior to imposing sentence, Judge Hornak stated that the sentence was sufficient but not greater than necessary to achieve the goals of sentencing.
Assistant United States Attorney Tonya Sulia Goodman prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Federal Bureau of Investigation, the Greater Pittsburgh Safe Streets Task Force, Wilkinsburg Police Department, Allegheny County Sheriff’s Office, Pennsylvania Office of the Attorney General, Munhall Police Department, Duquesne Police Department, Monroeville Police Department, Allegheny County Police Department, West Mifflin Police Department, Bellevue Police Department, and the Pittsburgh Bureau of Police for the investigation leading to the successful prosecution of Devonte White.
Rochester Physician Assistant Pleads Guilty to Dispensing Oxycodone Outside the Scope of Professional PracticeRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051ROCHESTER, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that Jeffrey C. Leathersich, 50, of Lima, NY, pleaded guilty to two counts of dispensing a controlled substance outside the scope of professional practice before U.S. District Judge Elizabeth A. Wolford. Each count carries a maximum penalty of 20 years in prison and a fine of $1,000,000.
“By abusing his medical licensing privilege, this defendant became nothing less than a drug dealer in a medical lab coat,” said U.S. Attorney Hochul. “Given the extreme number of fatalities associated with heroin and opioid overdoses in our area, the public should be assured that we will continue to pursue and prosecute all who would engage in the illegal distribution of these substances, regardless of title or position.”
Assistant U.S. Attorney Frank H. Sherman, who is handling the case, stated that between October 2013 and March 2016, the defendant was a Registered Physician Assistant practicing at New Genesis Center for Medical Weight Loss and Cosmetic Medicine at 3300 Monroe Avenue in Rochester, NY. Leathersich was licensed under New York State law and had a Drug Enforcement Administration Certificate of Registration authorizing him to prescribe Schedule II controlled substances. The defendant has been licensed as a Physician Assistant since 1995, been practicing cosmetic medicine since 2004, and, in 2010, also began practicing bariatric medicine.
Between October 2013 and December 2015, Leathersich maintained a social relationship with an individual identified as Patient A. During that time period, the defendant provided Patient A with 16 prescriptions for oxycodone, totaling approximately 30 grams, outside the scope of his professional practice and not for a legitimate medical purpose.
Between July 2015 and March 2016, Leathersich maintained a social relationship with an individual identified as Patient B. During that time period, the defendant provided Patient B with nine prescriptions for oxycodone, totaling approximately 26 grams, outside the scope of his professional practice and not for a legitimate medical purpose.
Oxycodone is an opioid pain medication. As a narcotic with a high potential for abuse that may lead to severe psychological or physical dependence, oxycodone is listed by the Attorney General as a Schedule II controlled substance.
As a result of this investigation, Leathersich signed a Voluntary Surrender of Controlled Substances Privileges form on May 9, 2016, with the Drug Enforcement Administration and is no longer authorized to prescribe controlled substances.
The plea is the culmination of an investigation on the part of the Drug Enforcement Administration, under the direction of Special Agent in Charge James J. Hunt, New York Field Division.
Sentencing is scheduled for September 22, 2016, at 2:00 p.m. before Judge Wolford.
Roanoke Man Pleads Guilty to Failing to Register as a Sex OffenderRead the Press Release
ROANOKE, VIRGINIA – A Roanoke, Virginia man, who failed to maintain his registration requirement under the Sex Offender Registration and Notification Act [SORNA], pled guilty today in the United States District Court for the Western District of Virginia to related federal charges, United States Attorney John P. Fishwick Jr. announced.
Gerald Dickey, 40, of Roanoke, Va., pled guilty today to one count of failing to register as a previously convicted sex offender.
“Keeping and maintaining an accurate registration, as required by SORNA, is imperative to public safety,” United States Attorney John P. Fishwick Jr. said today. “The requirements set forth in SORNA are not done as a burden to offenders but as a protection for the community, the offender and law enforcement. When those requirements are not met, there will be consequences.”
According to evidence presented at today’s hearing by Assistant United States Attorney, due to a previous convicted of criminal sexual conduct, Dickey was required to register as a sex offender under SORNA. In April 2015, Dickey was arrested by the Roanoke City Police Department on state charges and it was determined that despite the fact he had lived in Virginia for over a year, he had not registered as a sex offender, as required under SORNA.
The investigation of the case was conducted by the United States Marshals Service, the Virginia State Police and the Roanoke City Police Department. Assistant United States Attorney Charlene R. Day prosecuted the case for the United States.
Project Safe Childhood - Concord Man Sentenced to 24 Months for Failure to RegisterRead the Press Release
CONCORD, NEW HAMPSHIRE: Robert Grant, 60, of Concord, New Hampshire, was sentenced to 24 months in federal prison by the United States District Court for the District of New Hampshire after pleading guilty to one count of failing to register as a sex offender, announced United States Attorney Emily Gray Rice.
In July 2013, Grant was interviewed by the Concord Police Department. Grant advised that he was homeless and understood that he was required to register as a sex offender. After several more contacts with the Concord Police, Grant registered as a sex offender in December 2013.
Grant left New Hampshire shortly thereafter. In December 2015, a grand jury for the District of New Hampshire charged Grant with violating the Sex Offender Registration and Notification Act. Grant was found in Colorado and was arrested there in January 2016. He was returned to New Hampshire and pleaded guilty to the charge on February 26, 2016.
Grant was also sentenced to five years of supervised release that will begin after he is released from prison. During the period of supervised release, the United States Probation and Pretrial Services Office will monitor Grant’s behavior.
The case was investigated by the United States Marshal and the Concord Police Department. The case was prosecuted by Assistant United States Attorney Helen Fitzgibbon.
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Panamanian National Indicted for False Statement in a Passport Application and Reentry of Removed AlienRead the Press Release
U.S. Attorney Kenneth A. Polite announced that CAROL JOHN, a/k/a INES ISABEL RUIZ, a/k/a CAROL ATKINS, age 56, a citizen of Panama, was charged today in a two-count Indictment for making a false statement in an application for a U.S. passport and reentry of removed alien.
According to the Indictment, on or about March 4, 2016, JOHN applied for a passport and falsely stated that she had been born in the Panama Canal Zone, which she knew to be false. The Indictment also charges that, on or about May 23, 2016, JOHN was found in the United States after having been officially deported on or about May 24, 1996, following a conviction for attempted cocaine distribution.
If convicted, JOHN faces a maximum term of imprisonment of twenty years, a fine of up to $250,000, five (5) years supervised release after imprisonment, and a $200 special assessment.
U.S. Attorney Polite reiterated that an Indictment is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
U.S. Attorney Polite praised the work of the United States Diplomatic Security Service in investigating this matter. Assistant United States Attorney Irene González is in charge of the prosecution.
Palm Beach County Resident Sentenced to Twenty-One Years in Prison for Narcotics Trafficking and Unlawful Gun PossessionRead the Press Release
Palm Beach County resident Kevin Raphael Bully, 26, was sentenced to 262 months in prison by United States District Judge Robin L. Rosenberg following his conviction at trial of being a felon in possession of a firearm, conspiring to import and distribute Alpha PVP (a/k/a “Flakka”), and distributing heroin and Xanax.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Adolphus P. Wright, Special Agent in Charge, Drug Enforcement Agency (DEA), Miami Field Office, made the announcement.
This case stemmed from an investigation into the importation of Alpha-pyrrolidinopentiophenone (“α-PVP”), aka “Flakka,” from China into the United States. In March of 2015, as a part of an ongoing investigation regarding the illegal drug trafficking of synthetic cathinones, specifically Flakka, DEA agents received information about suspected narcotics packages being delivered to Palm Beach County. DEA agents in London, England received information from the British authorities regarding multiple packages that were intercepted coming from a chemical company in Hong Kong, China. The Chinese based chemical company had been utilizing a shipping company to transport chemicals to buyers in the United States. The British authorities found approximately seven packages that contained a white crystallized substance which tested positive for the presence of α-PVP. DEA agents in London provided West Palm Beach agents with the packages’ address information and forwarded the deliveries. The local agents, including a law enforcement officer dressed as a DHL employee, delivered a package to the listed address. Bully answered the door of the identified address and took possession of the package upon delivery.
During the course of the investigation, Bully’s cell phone was found to contain text messages discussing the importation and receipt of packages containing Flakka. In July of 2015, Bully was found at a hotel in Boca Raton, Florida, in possession of over 50 grams of heroin, 1,600 tablets of Xanax, a digital scale and packaging used for the distribution of narcotics.
Mr. Ferrer commended the investigative efforts of the DEA and support of the United States Marshals Service. The case was prosecuted by Assistant U.S. Attorney Lothrop Morris.
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.
Owner of West Suburban Weight Loss Center Indicted in Scheme to Illegally Dispense Appetite-Suppressant DrugsRead the Press Release
CHICAGO — The owner of a Lombard weight-loss center and a Burr Ridge physician have been charged with conspiracy and other crimes related to dispensing appetite-suppressant drugs without a legitimate medical purpose.
According to a 17-count federal indictment, MICHAEL JENNINGS, the owner of Results Weight Loss Center, made cash payments to the doctor in exchange for using the physician’s federal registration number to order and dispense hundreds of thousands of dosages of Phendimetrazine and Phentermine. The physician, WILLIAM MIKAITIS, was rarely present at the weight-loss center, according to the indictment. Instead, Jennings, who is not a doctor and lacks medical training, identified himself to patients as “Dr. Mikaitis” and ordered the prescriptions without conducting meaningful examinations or tests, the indictment states.
The indictment alleges that between approximately February 2013 and January 2015, Jennings made cash deposits of approximately $75,000 into Mikaitis’ bank account. The indictment seeks a total forfeiture from the defendants of approximately $790,000 in illegal proceeds from the scheme.
The indictment was returned yesterday in federal court in Chicago. It charges Jennings, 48, of Naperville, and Mikaitis, 72, of Burr Ridge, with one count of conspiracy to distribute controlled substances outside the course of professional practice and without a legitimate medical purpose, seven counts of distributing controlled substances outside the course of professional practice and without a legitimate medical purpose, seven counts of dispensing prescription drugs without a valid prescription, and one count of conspiracy to conduct a financial transaction involving the proceeds of unlawful activity. The counts are punishable by a maximum combined sentence of 95 years in prison.
Mikaitis, who maintains a medical practice in Lockport, is also charged individually with one count of engaging in a monetary transaction involving criminally derived property valued at more than $10,000. This count carries a maximum sentence of ten years in prison.
Jennings and Mikaitis will be arraigned before U.S. District Judge Virginia M. Kendall on June 9, 2016, at 9:30 a.m.
The indictment was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Dennis A. Wichern, Special Agent-in-Charge of the Chicago Field Division of the U.S. Drug Enforcement Administration; and James D. Robnett, Special Agent-in-Charge of the Internal Revenue Service Criminal Investigation Division in Chicago. The U.S. Food and Drug Administration’s Chicago Office and the Naperville Police Department assisted in the investigation, which was conducted under the umbrella of the Organized Crime Drug Enforcement Task Force (OCDETF).
The public is reminded that an indictment is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines.
The government is represented by Assistant U.S. Attorney Matthew Schneider.
Indictment
Owner of String of Marijuana ‘Dispensaries’ Sentenced to Ten Years in Prison for Drug TraffickingRead the Press Release
A south Puget Sound area resident who tried to hide his illegal drug dealing behind what he falsely claimed was a ‘medical marijuana dispensary’ operating consistent with state law, was sentenced today in U.S. District Court in Tacoma to ten years in prison and five years of supervised release for two federal charges related to drug distribution, announced U.S. Attorney Annette L. Hayes. LANCE EDWARD GLOOR, 37, was convicted in January 2016 of conspiracy to distribute marijuana, and manufacturing marijuana. At the sentencing hearing U.S. District Judge Ronald B. Leighton said, “Mr. Gloor is a flim-flam man. He manipulates those around him. He, at the end of the day, persists at flaunting the basic, everyday rules.”
“Far from being a marijuana crusader helping sick people, this defendant was nothing but a black marketeer,” said U.S. Attorney Annette L. Hayes. “Despite repeated notice that his marijuana business was illegal under state and federal law, he continued to use lies, threats and intimidation to try to cover his tracks and make as much money as he could.”
According to records filed in the case and testimony at trial, GLOOR and his long-time business associate were the subjects of law enforcement investigations as early as 2010. In the fall of 2010, local law enforcement officers executed a search warrant at GLOOR’s home where they discovered more than 70 marijuana plants and a firearm. While awaiting trial on charges filed in state court, GLOOR and his associate opened four so-called marijuana ‘dispensaries’: Tacoma Cross, Lacey Cross, Seattle Cross, and over on the Kitsap Peninsula, KPN Cross. A joint state and federal law enforcement investigation revealed that these locations claimed to be medical marijuana “non-profit dispensaries” operating under state law, when in fact they were for profit businesses generating millions of dollars in gross revenues inconsistent with all applicable state requirements. Search warrants were served on the business in 2011, and following that GLOOR claimed he was getting out of the marijuana business. In fact, further investigation and a second round of search warrants in 2013 revealed GLOOR was still operating two of the four dispensaries, but had attempted to do so while hiding his ongoing role.
At various times throughout the investigation and trial, GLOOR sought to contact and intimidate witnesses via text message and social media. After GLOOR repeatedly violated court orders regarding the conditions of his release, he was taken into custody and has been incarcerated at the Federal Detention Center at SeaTac since April 2016.
GLOOR was indicted with two co-conspirators in November 2013. His co-conspirators have entered guilty pleas and are awaiting sentencing.
The case was investigated by the Thurston Narcotic Task Force (TNT) and the Drug Enforcement Administration (DEA). The case is being prosecuted by Assistant United States Attorneys Vince Lombardi and Marci Ellsworth.
Ocean Springs Spa Manager Pleads Guilty to Money Laundering ConspiracyRead the Press Release
Gulfport, Miss. – Yeon Sook Hwang, 41, of Ocean Springs, pled guilty on Thursday, June 2, 2016, before U.S. District Judge Sul Ozerden, to conspiracy to commit money laundering in a case involving the interstate transportation of prostitutes, U. S. Attorney Gregory K. Davis announced today. Hwang was identified as the manager of a massage parlor operating in Ocean Springs at which Korean women would provide sexual services.
Hwang will be sentenced on September 1, 2016, and faces a maximum of 20 years in prison and a $500,000 fine. This case was investigated by the Federal Bureau of Investigation and prosecuted by Assistant United States Attorney Annette Williams.
New York Man Sentenced in Manhattan Federal Court to 25 Years in Prison for Trafficking of Heroin, Cocaine, and MDMARead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today that ROMAN KITROSER was sentenced in Manhattan federal court to 25 years in prison for conspiring to distribute heroin, cocaine, MDMA, crack cocaine, and marijuana. KITROSER, who pled guilty to one count of narcotics conspiracy on November 2, 2015, was also found to have possessed dangerous weapons in connection with the conspiracy, including firearms and hand grenades. KITROSER pled guilty before U.S. District Judge Katherine Polk Failla, who imposed today’s sentence.
U.S. Attorney Preet Bharara stated: “In Roman Kitroser’s drug dealing operations, customers could literally pick their poison: he trafficked in heroin, cocaine, crack, MDMA, and marijuana. To protect his illicit trade, Kitroser armed himself with an arsenal of dangerous weapons, including guns, silencers and even hand grenades. Thanks to the work of the DEA, NYPD and New York State Police, Kitroser’s dangerous business is finished.”
According to the Indictment and other documents filed in federal court, statements made at various proceedings in this case, and evidence presented at the sentencing hearing:
From December 2013, to December 2014, KITROSER conspired to distribute heroin, cocaine, and marijuana as a member of a drug trafficking organization. In connection with his arrest, KITROSER was found in possession of nine firearms, two silencers, high-capacity magazines, and a large press used to form loose narcotics into kilogram-sized bricks. Law enforcement officers also seized more than $2 million, as well as two hand grenades, in connection with the investigation.
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In addition to the prison sentence, KITROSER, 39, of Brooklyn, New York, was sentenced to five years of supervised release.
United States Attorney Bharara praised the investigative work of the Drug Enforcement Administration, the New York City Police Department, and the New York State Police.
The case is being handled by the Office’s Narcotics Unit. Assistant U.S. Attorney Megan Gaffney and Alex Rossmiller are in charge of the prosecution.
New Jersey Man Acquitted on Alien Transportation ChargeRead the Press Release
ALBANY, NEW YORK – A jury voted today to acquit Cumhur Aydin, age 45, on a charge of transporting an alien.
Aydin, of New Jersey, was indicted on January 6, 2016 on a single charge of transporting, in Franklin County, New York, an alien who had no right to be present in the United States.
The jury voted to acquit Aydin following a three-day trial in Albany before Senior U.S. District Judge Frederick J. Scullin, Jr.
NCMEC CEO Visits the USNCBRead the Press Release
On Tuesday, May 31, 2016, Director Shank met with NCMEC CEO John Clark to discuss continued collaboration between the two organizations. Mr. Clark is the former Director of the U.S. Marshals Service.
Muskogee Man Pleads Guilty to Theft of Government FundsRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that ENRIQUE GONZALEZ a/k/a Henry Gonzalez, age 44, of Muskogee, Oklahoma, pled guilty to an Information filed on May 27, 2016, charging him with THEFT OF GOVERNMENT FUNDS, in violation of Title 18, United States Code, Section 641, punishable by not more than 10 years imprisonment, up to a $250,000.00 fine or both.
The Information alleged that beginning on or about August 13, 2015, and continuing until on or about November 21, 2015, within the Eastern District of Oklahoma, defendant ENRIQUE GONZALEZ a/k/a Henry Gonzalez, did knowingly and willfully embezzle, steal, and purloin money of the Department of Veterans Affairs, a department or agency of the United States, namely, Department of Veterans Affairs Educational Benefits payments to which he knew he was not entitled, having a value in excess of $1,000.00.
The Honorable Kimberly E. West, Magistrate Judge in the United States District Court for the Eastern District of Oklahoma, accepted the defendant’s guilty plea, and ordered the completion of a presentence report. Sentencing will be scheduled upon its completion. The defendant remains on bond pending sentencing.
The charges are a result of an investigation by the Department of Veterans Affairs, Office of Inspector General.
First Assistant United States Attorney Doug Horn represented the United States.
Mexican Man Sentenced for Illegal Reentry After DeportationRead the Press Release
CONCORD, NEW HAMPSHIRE – United States Attorney Emily Gray Rice announced that Jose Villavazo-Gutierrez, 25, of Mexico, pleaded guilty to illegally reentering the United States after having been previously deported. Villavazo-Gutierrez, was arrested on February 17, 2016. He was sentenced to time served and is subject to deportation.
On February 17, 2016, ICE-ERO Deportation Officers encountered the defendant when they were at a residence in Nashua, New Hampshire, during an attempt to locate another individual at the residence. The defendant was an occupant at the residence. The defendant did not have any identification, told the agents that he was from Mexico, and admitted that he did not have any immigration documents which would allow him to be legally in the United States.
The Deportation Officers submitted the defendant’s fingerprints for comparison to databases of known fingerprints. The fingerprint impressions submitted were a match to those taken from the defendant on the occasion of his previous deportations from the United States to Mexico in 2014.
The case was investigated by the U.S. Department of Homeland Security, Bureau of Immigration and Customs Enforcement and prosecuted by Assistant U.S. Attorney Alfred Rubega.
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Men Charged with Armed Robberies of West Haven Post Office and Hamden BankRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that a federal grand jury in Bridgeport returned an indictment today charging DERRICK WHITE, also known as “Fly,” 51, of Hamden, MALCOLM HAYNES, also known as “Black,” 25, of New Haven, and HOWARD BOOKERT, 18, of Hamden, with one count of armed robbery of a postal employee. The indictment also charges WHITE and HAYNES with one count of armed bank robbery.
The indictment alleges that, on April 21, 2016, WHITE, HAYNES, and BOOKERT entered the U.S. Post Office located at 75 Farwell Avenue in West Haven, stole money and other government property, and put the life of a postal employee and others in jeopardy by the use of a dangerous weapon.
The indictment further alleges that, on April 21, 2016, WHITE, HAYNES, and another person known to the grand jury used force, violence and intimidation to rob $9,287 from a branch of Wells Fargo Bank located at 1647 Whitney Avenue in Hamden, putting in jeopardy the life of a person by the use of a dangerous weapon.
WHITE and BOOKERT have been detained since April 21, 2016, when they were apprehended in New Haven and arrested on related state charges. HAYNES has been detained since his arrest on related state charges on May 23, 2016.
If convicted, the defendants face a maximum term of imprisonment of 25 years and a fine of up to $250,000 on each count.
U.S. Attorney Daly stressed that an indictment is not evidence of guilt. Charges are only allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This matter is being investigated by the West Haven Police Department, Hamden Police Department, New Haven Police Department, Federal Bureau of Investigation, and U.S. Postal Inspection Service. The case is being prosecuted by Assistant U.S. Attorney Anastasia E. King.
Maryland Man Pleads Guilty to Conspiring to Commit ArsonRead the Press Release
ABINGDON, VIRGINIA – A Dundalk, Maryland, man who had been a fugitive for four years before being apprehended in Florida, pled guilty yesterday in Federal Court to conspiring to commit arson, United States Attorney John P. Fishwick Jr. announced.
William Antonion Parks, 26, pled guilty yesday in the United States District Court for the Western District of Virginia in Abingdon to one count of conspiring to destroy, by fire, a motor vehicle. On October 9, 2011, Parks and two other men, James Robert Gurganus and Jeremiah D. Lawson, set fire and destroyed a vehicle in Lee County, Virginia. Gurganus and Lawson pled guilty and were sentenced several years ago. Parks fled after the fire and had been at large until his arrest in Florida by agents of the United States Marshal’s Service in March of this year.
“This individual not only put others at risk by committing arson and destroying a motor vehicle, but he also felt he could flee from justice,” Unite States Attorney John P. Fishwick Jr. said today. “I am grateful to our law enforcement partners both here in Virginia and in Florida who continued to search for this defendant and ultimately held him accountable for his criminal actions.”
United States District Judge James P. Jones scheduled sentencing for August 30, 2016 at 10:30 a.m. Parks faces a mandatory sentence of imprisonment for a term of not less than five years and no more than twenty years and a fine of up to $250,000.
The investigation of the case was conducted by the Bristol Office of the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Lee County Sheriff’s Office. Special Assistant United States Attorney Albert Mayer and Assistant United States Attorney Randy Ramseyer prosecuted the case for the United States.
Man Sentenced to 51 Months in Prison for Bank RobberyRead the Press Release
WASHINGTON – John C. Matthews, 67, of no fixed address, has been sentenced to a 51-month prison term after earlier pleading guilty to robbing a bank last fall in Northwest Washington, announced U.S. Attorney Channing D. Phillips, Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office, and Cathy L. Lanier, Chief of the Metropolitan Police Department (MPD).
Matthews pled guilty to a charge of bank robbery in February 2016 in the U.S. District Court for the District of Columbia. He was sentenced on June 2, 2016 by the Honorable Emmet G. Sullivan. Following his prison term, Matthews will be placed on three years of supervised release. At the time of the offense, he was on parole for an armed robbery committed in 1978, and his parole had been revoked on six previous occasions.
According to the government's factual proffer, on Thursday, Nov. 12, 2015, at approximately 9:22 a.m., Matthews walked into the PNC Bank located in the 1700 block of Columbia Road NW. He walked up to a teller, began pointing to the front door of the bank, and provided a handwritten note with instructions to read it. Among other things, the note stated “That box contain enough C-4 explosives to cause great harm to people if the gentleman in hard hat push a bottom [sic];” “Fill bags with $100 bills, $50 bills, and $20 bills;” “—No dye packs –No silent alarms – No Traces;” “Fill bags so they easily slide through window opening;” and “Hurry up!!!” At about this time, the man who was wearing a construction-type vest and hard-hat -- and who is still at large -- opened the inner bank door from the vestibule and placed a shoe box in the lobby and then re-entered the bank vestibule.
The teller gave Matthews approximately $1,150 in currency and he and the second man then left the bank. The robbery was captured on bank video and Matthews’s face, unmasked, was clearly visible. By about 11 a.m., law enforcement located Mathews hiding in a rear basement storage room a few blocks away. He was wearing the same clothing as seen in the video of the bank robbery and with the stolen money still on his person. He has been in custody ever since. The bank building was evacuated and MPD’s Explosives Ordinance Disposal Unit was called in while much of the block was cleared. Bomb technicians ultimately determined that there were no explosives in the shoe box that was placed on the floor by the other man.
In announcing the sentence, U.S. Attorney Phillips, Assistant Director in Charge Abbate, and Chief Lanier praised the work of the D.C. Violent Crimes Task Force, which includes members of the FBI’s Washington Field Office, the Metropolitan Police Department, the U.S. Capitol Police, and the U.S. Marshals Service. They also commended the efforts of those who assisted at the U.S. Attorney’s Office, including Paralegal Specialists Teesha Tobias and Candace Battle and Legal Assistant Latoya Wade. Finally, they expressed appreciation for the work of Assistant U.S. Attorneys Vincent Caputy, who indicted the case, and Stephen J. Gripkey, who handled the case thereafter.
Leader of Stolen Identity Refund Scheme Sent to Federal PrisonRead the Press Release
HOUSTON – Ronald Dewayne Hadley has been ordered to prison following his conviction for leading a Houston-area stolen identity refund fraud (SIRF) scheme, announced U.S. Attorney Kenneth Magidson along with Special Agent in Charge Rick Goss of IRS - Criminal Investigation (CI) in Houston.
Hadley pleaded guilty Aug. 28, 2015. Today, U.S. District Judge Melinda Harmon handed him a 48-month term in federal prison to be immediately followed by three years of supervised release. Judge Harmon also ordered Hadley to pay $317,790 in restitution to the IRS.
Three others also pleaded guilty in the scheme - Lyndell Leroy Price, Leondray Demond Garrison and Ryan Duron Clay – who will sentenced at later dates.
“This investigation demonstrates IRS-CI’s ability to detect identity thieves who believe they are protected under the cover of anonymity, said Mary Hammond, Assistant Special Agent in Charge of IRS-CI. “Perpetrators at all levels in a stolen identity refund fraud scheme will be pursued and prosecuted.”
According to information in the respective plea agreements, Hadley led a conspiracy to submit false tax returns to the IRS for tax years 2010 through 2012, which sought fraudulent refunds totaling approximately $811,710. The scheme began in the fall of 2011 when Hadley began to prepare and electronically file tax returns which falsely reported that taxpayers were barbers who had earned no wages but had received thousands of dollars of dividend income. The income was purportedly from supplies on which they had supposedly paid thousands of dollars of fictitious withholding taxes that were entitled to be refunded.
Hadley obtained taxpayer identification information both directly from these individuals as well as indirectly through the assistance of Price, Garrison and Clay. Hadley and his conspirators obtained debit cards in the names of these people whose identities were then used to electronically file false refund claims anonymously via public wi-fi access provided by local fast-food restaurants and a coffee shop. Hadley had the refunds credited to debit cards under the conspirators’ control. The co-conspirators withdrew the fraudulent refunds at local ATMs and used the debit cards at businesses spread across central, north and northwest Houston and Houston’s Third Ward.
The scheme began to unravel in the third tax season when IRS fraud detection measures revealed suspicious patterns among the fraudulent refund claims and took steps to prevent all but three of the claims submitted that year from being paid.
According to the pleas, Hadley e-filed all of the fraudulent tax returns and personally originated identity information for approximately half of the refund claims. His conspirators provided him with the remaining identities. Price provided Hadley with identities that generated fraudulent refund claims totaling almost $250,000 resulting in actual losses to the IRS of almost $130,000. Garrison provided identities that generated fraudulent refund claims totaling almost $95,000, while Clay provided identities that generated fraudulent refund claims totaling almost $40,000. The resulting in actual losses to the IRS for which Garrison and Clay responsible amounts to approximately $30,000 and $25,000, respectively.
All were permitted to remain on bond.
IRS-CI investigated. Assistant U.S. Attorney Jimmy Sledge Jr. is prosecuting the case.
LRGP Member Pleads Guilty to Rico Conspiracy Involving Murder and Drug ConspiracyRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051BUFFALO, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that Fred Keys 53 of Buffalo, NY, pleaded guilty before U.S. District Judge Richard J. Arcara to RICO conspiracy and also pleaded guilty to conspiracy to possess with intent to distribute and distribute 28 grams or more of crack cocaine. Keys faces a mandatory minimum penalty of 10 years in prison, a maximum of life and a $10,250,000 in fines.
Assistant U.S. Attorneys Thomas S. Duszkiewicz and Joel L. Violanti, who are handling the case, stated that between 2009 and January 23, 2012, Keys was an associate of the LRGP gang which operates primarily in the area of Lombard, Rother, Gibson and Playter Streets in the City of Buffalo. It is alleged to be an organization engaged in violent criminal activity, including the distribution of cocaine and crack cocaine and the use of firearms.
In April 2011, the defendant and others, while at 318 Sobieski Street in Buffalo, agreed that a member of the Cold Springs Gang, a rival criminal organization, should be murdered in retaliation for the killing Alonzo Scott, in March 2011. Scott was the brother of LRGP leader Dewayne Gray. The individuals settled upon killing Amir Chambers, whom they believed to be associated with the Cold Springs Gang, and who had an ongoing social relationship with Alexis Mills.
After a failed attempt by Mills to poison Amir Chambers, it was agreed that Keys would kill Chambers by shooting him. Mills was to use her relationship with Chambers to get the victim to open his residence door. On April 20, 2011, Keys, Mills, Timothy Finch and Philip Brown went to a residence at 111 Mills Street in Buffalo where they dropped off Fred Keys and Alexis Mills. Chambers opened the residence door upon seeing Alexis Mills at which time Keys today admitted that he killed Chambers by shooting him in the head. Mills, for her part, kicked the victim in the head following the shooting to ensure that Chambers was in fact deceased. Keys later called 911 to report that there was a “body” at 111 Mills Street.
Alexis Mills, Dewayne Gray, Timothy Finch and 13 other LRGP members were convicted previously and are awaiting sentencing. Philip Brown is scheduled to go to trial on June 14, 2016. The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
The pleas are the result of an investigation by the Federal Bureau of Investigation Safe Streets Task Force, under the direction of Special Agent in Charge Adam S. Cohen, the Drug Enforcement Administration, under the direction of Special Agent in Charge James J. Hunt, New York Field Office, the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Delano A. Reid, New York Field Office and the Buffalo Police Department, under the direction of Commissioner Daniel Derenda.
Fred Keys will be sentenced on September 8, 2016 at 1:00 p.m. before Judge Arcara.
Kingston Man Sentenced to 121 Months for Attempting to Entice a ChildRead the Press Release
ALBANY, NEW YORK – Daniel Jurow, age 37, of Kingston, New York, was sentenced today to serve 121 months in prison after being convicted of using the internet to try to entice a child to meet him for sex.
The announcement was made by United States Attorney Richard S. Hartunian and James C. Spero, Special Agent in Charge of the Buffalo Field Office of Homeland Security Investigations (HSI).
United States District Judge Mae A. D’Agostino also imposed a lifetime term of supervised release, to begin after Jurow’s release from prison. Jurow’s conviction will also require him to register as a sex offender.
As a part of his guilty plea, Jurow admitted that on March 12, 2015, he travelled to Colonie, New York, where he had arranged to meet and have sex with a person he believed to be a 12-year-old girl. Instead, Jurow was arrested by law enforcement.
This case was investigated by HSI and the New York State Police, and was prosecuted by Assistant U.S. Attorneys Solomon B. Shinerock and Elizabeth R. Rabe. The case was investigated as part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the United States Attorneys Offices, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the internet, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
Key Player in ‘Silk Road 2.0’ Sentenced to Eight Years in PrisonRead the Press Release
A former Bellevue, Washington resident who assisted in the management of the Silk Road 2.0 website was sentenced today in U.S. District Court in Seattle to eight years in prison and four years of supervised release for Conspiracy to Distribute Controlled Substances, announced United States Attorney Annette L. Hayes. BRIAN RICHARD FARRELL, 27, who used the moniker “DoctorClu” on the Silk Road site, came to the attention of Homeland Security Investigations agents in July 2014. Silk Road 2.0 was a hidden website designed to enable its users to buy and sell illegal drugs and other unlawful goods and services anonymously and beyond the reach of law enforcement. At the sentencing hearing U.S. District Judge Richard A. Jones emphasized that a strong deterrent message needs to be sent to people who sell illegal contraband on the dark web because such sites allow people to “hide in the cover of darkness in their houses.”
“The dark web is not the safe haven some think,” said U.S. Attorney Annette L. Hayes. “This sentence should send a clear message to those who peddle illegal drugs via the dark web: you will be caught, prosecuted and face serious penalties.”
According to records filed in the case, Silk Road 2.0 went online in November 2013 following the government’s seizure of the first Silk Road website and the arrest of its alleged owner and operator, Ross William Ulbricht, a/k/a “Dread Pirate Roberts.” In November 2014, Blake Benthall, a/k/a “Defcon,” the operator of the Silk Road 2.0 site, was arrested in San Francisco. FARRELL was a key assistant to Benthall in running the site.
“Silk Road 2.0” was one of the most extensive, sophisticated, and widely used criminal marketplaces on the Internet. The website operated on the “Tor” network, a network of computers on the Internet, located around the world, designed to ‘anonymize’ or conceal the true IP addresses of computers that used the network and thereby the identities of the network’s users. Since its launch in November 2013, Silk Road 2.0 was used by thousands of drug dealers and other vendors to distribute hundreds of kilograms of illegal drugs and other illicit goods and services to buyers throughout the world, as well as to launder millions of dollars generated by these unlawful transactions. As of September 2014, Silk Road 2.0 was generating sales of approximately $8 million per month and had approximately 150,000 active users.
FARRELL was one of the small staff of online administrators and forum moderators who assisted Blake Benthall with the day-to-day operation of the website. Benthall and this small staff controlled and oversaw all aspects of Silk Road 2.0, including, among other things: the computer infrastructure and programming code underlying the website; the terms of service and commission rates imposed on vendors and customers of the website; and the massive profits generated from the operation of the illegal business. FARRELL, operating under the moniker “DoctorClu,” was involved in activities such as approving new staff and vendors for the website, and organizing a denial of service attack on a competitor. When a search warrant was served at FARRELL’s Bellevue home, agents seized $35,000 in cash as well as silver bullion and various types of drug paraphernalia.
“As one of the key masterminds and coordinator of the Silk Road criminal marketplace, Farrell profited from the destruction of untold lives,” said Brad Bench, Special Agent in Charge of HSI Seattle. “Criminals who operate digital black markets and those who trade their illicit goods on them quite mistakenly believe they are above the law. It is one of HSI’s top priorities to shut down these hidden websites and bring their criminal operators and customers to justice.”
The case was investigated by Seattle-Tacoma Border Enforcement Security Task Force (BEST Seattle), U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the United States Postal Inspection Service (USPIS), and the FBI.
The case is being prosecuted by Assistant United States Attorney Thomas Woods.
BEST Seattle is comprised of members from HSI; U.S. Customs and Border Protection's Office of Field Operations; the U.S. Secret Service; the U.S. Coast Guard Investigative Service; the USPIS; and the Seattle and Port of Seattle police department. BEST Seattle investigates smuggling and related crimes and combats criminal organizations seeking to exploit vulnerabilities at the Seattle and Tacoma seaports and adjacent waterways.
Justice Department Issues Draft Guidance Regarding Expert Testimony and Lab Reports in Forensic ScienceRead the Press Release
The Justice Department announced today the release of draft guidance documents governing the testimony and reports of the department’s forensic experts. These documents, available for public comment through July 8, are designed to ensure that department forensic experts only make statements in the courtroom and in laboratory reports that are supported by sound science.
The drafting of these proposed documents arose out of the department’s ongoing, multi-year effort to strengthen the practice of forensic science. Once finalized and adopted, these documents, known as the Uniform Language for Testimony and Reports, will apply to all department personnel who issue forensic reports or provide expert forensic testimony, including forensic experts at the FBI, Drug Enforcement Administration (DEA) and Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).
“Forensic science is a critical component of our criminal justice system, both for identifying the perpetrator of a crime and for clearing the innocent,” said Deputy Attorney General Sally Q. Yates. “Once finalized and adopted, these guidance documents will clarify what scientific statements our forensic experts may – and may not – use when testifying in court and in drafting reports, in turn strengthening the integrity of our system overall.”
The proposed uniform language documents released today cover seven forensic science disciplines: body fluid testing (serology), drug and chemical analysis (general chemistry), fibers, foot prints/tire treads, glass, latent fingerprints and toxicology. This summer, the department will release a second round of proposed documents for public comment, which will include draft guidance relating to DNA, explosive devices, hair analysis and handwriting. The department expects to adopt final versions of these documents later this year.
Once finalized and adopted, the uniform language documents will only apply to department personnel, but the department decided to release the proposed documents for public comment in an effort to promote transparency and to solicit feedback from the broader forensic science community. As today’s proposed documents make clear, the uniform language documents are not intended to serve as precedent for other forensic laboratories and do not imply that statements by other laboratories are incorrect, indefensible or erroneous.
Copies of the proposed uniform language documents are available for review at https://justice.gov/forensics. Public comments may be submitted through www.regulations.gov.
Jury Trial Results in Conviction of Three Minnesotans for Conspiring to Join ISIL and Commit Murder in SyriaRead the Press Release
GULED ALI OMAR, ABDURAHMEN YASIN DAUD, and MOHAMED ABDIHAMID FARAH were convicted by a federal jury today of conspiring to commit murder in Syria on behalf of the Islamic State of Iraq and the Levant (ISIL) and to provide material support to the designated foreign terrorist organization.
The convictions were announced by U.S. Attorney Andrew M. Luger, Special Agent in Charge Richard T. Thornton of the FBI’s Minneapolis Division, and Assistant Attorney General for National Security John P. Carlin.
“The evidence in this case made clear that the defendants made a deeply personal and deliberate decision back in 2014,” said United States Attorney Andrew Luger. “They wanted to fight for a brutal terrorist organization, kill innocent people and destroy their own families in the process. This trial should serve as a wake-up call that it will take the entire community to stop terror recruiting in Minnesota.”
“These verdicts affirm the FBI's investigative efforts,” said Special Agent in Charge Richard T. Thornton. “The FBI will not induce people to break our laws. However, the FBI, through all legal means at its disposal, will investigate and pursue those who aim to bring about harm to others.”
“In the first multi-defendant ISIL-related trial, Mohamed Farah, Abdirahman Daud and Guled Omar were convicted of conspiring to provide material support to the foreign terrorist organization and other federal offenses,” said Assistant Attorney General Carlin. “The defendants conspired with a larger group of individuals to travel to Syria to fight on behalf of ISIL. Countering terrorist threats remains the highest priority of the National Security Division. We will continue to work to disrupt the recruitment and radicalization of Americans by terrorist organizations, and bring to justice those who conspire to provide material support to terrorists. I would like to thank the many agents, analysts and prosecutors who worked tirelessly to secure this conviction.”
Between May 2014 and their arrests on April 19, 2015, these three defendants and their co-conspirators made multiple attempts to join the Islamic State of Iraq and the Levant (ISIL) in Syria.In May 2014, some members of the conspiracy, including defendant GULED OMAR and co-conspirators ABDI NUR, ABDULLAHI YUSUF, traveled or attempted to travel to Syria to join ISIL. To facilitate the travel of his co-conspirators, defendant DAUD provided contact information for an ISIL member in Turkey to NUR and YUSUF so they could gain assistance crossing the border from Turkey into Syria. NUR succeeded in his plan, joining ISIL in Syria in June 2014. YUSUF was stopped at the Minneapolis/ St. Paul Airport and was later arrested.
Also in May 2014, defendant OMAR and two other members of the conspiracy made an attempt to join ISIL by traveling across the United States – Mexico border near San Diego. This planned failed when members of defendant OMAR’s family prevented his travel.
In October 2014, members of conspiracy communicated with “Antar,” a self-described member of ISIL in Syria, about how best to travel to Syria to join ISIL. Members of conspiracy met with one another to discuss routes, methods and the timing of leaving the United States to join ISIL in Syria.
Defendant OMAR again attempted to join ISIL in Syria on November 6, 2014, by first flying from Minneapolis/St. Paul International Airport to San Diego, California. Again, defendant OMAR planned to cross the United States – Mexico border near San Diego and travel onward to Syria to join ISIL. Before he could board the flight in Minnesota, OMAR was stopped at the airport and prevented from boarding the plane. In order to fund this second attempt to join ISIL in Syria, OMAR intended to use federal financial aid provided to him by the United States Department of Education to attend college.
Also in November 2014, defendant FARAH and three of his co-conspirators, defendants ZACHARIA ABDURAHMAN, HANAD MUSSE, and HAMZA AHMED, took a Greyhound bus to New York City and attempted to board flights to Europe. Defendant FARAH’s ultimate destination was Syria, where he planned to join and fight with ISIL. Federal agents in New York prevented defendant FARAH and his three co-conspirators from traveling.
In April 2015, defendants DAUD and FARAH drove from Minneapolis to San Diego, Calif., where they intended to purchase fake passports, cross the border into Mexico, travel to Syria to join ISIL. Unbeknownst to them, the individual from whom they purchased the fake passports was a law enforcement officer and both were arrested by federal agents immediately after obtaining the phony travel documents.
Ten Minnesotans were charged as part of this conspiracy to provide material support to ISIL. The men are all associates and friends of one another. Six defendants pleaded guilty before trial and one, ABDI NUR, joined ISIL in Syria in June 2015.
This case is the result of an investigation conducted by the FBI-led Joint Terrorism Task Force.
The case is being prosecuted by Assistant United States Attorneys Andrew Winter, John Docherty, and Julie Allyn, with assistance provided by the National Security Division’s Counterterrorism Section
Special thanks to San Diego and New York Field Offices of the FBI and the United States Attorney’s Office in the Southern District of California.
Defendant Information:
GULED ALI OMAR, 21
Minneapolis, Minn.Convicted: • Conspiracy to Murder Outside the United States, 1 count
• Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
• Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 2 counts
• Attempted Financial Aid Fraud, 1 countMOHAMED ABDIHAMID FARAH, 22
Minneapolis, Minn.Convicted: • Conspiracy to Murder Outside the United States, 1 count
• Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
• Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 2 counts
• Perjury, 1 count
• False Statement, 1 countABDIRAHMAN YASIN DAUD, 22
Minneapolis, Minn.Convicted: • Conspiracy to Murder Outside the United States, 1 count
• Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
• Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 1 countJury Trial Results in Conviction of Three Minnesotans for Conspiring to Join ISIL and Commit Murder in SyriaRead the Press Release
GULED ALI OMAR, ABDURAHMEN YASIN DAUD, and MOHAMED ABDIHAMID FARAH were convicted by a federal jury today of conspiring to commit murder in Syria on behalf of the Islamic State of Iraq and the Levant (ISIL) and to provide material support to the designated foreign terrorist organization.
The convictions were announced by U.S. Attorney Andrew M. Luger, Special Agent in Charge Richard T. Thornton of the FBI’s Minneapolis Division, and Assistant Attorney General for National Security John P. Carlin.
“The evidence in this case made clear that the defendants made a deeply personal and deliberate decision back in 2014,” said United States Attorney Andrew Luger. “They wanted to fight for a brutal terrorist organization, kill innocent people and destroy their own families in the process. This trial should serve as a wake-up call that it will take the entire community to stop terror recruiting in Minnesota.”
“These verdicts affirm the FBI's investigative efforts,” said Special Agent in Charge Richard T. Thornton. “The FBI will not induce people to break our laws. However, the FBI, through all legal means at its disposal, will investigate and pursue those who aim to bring about harm to others.”
“In the first multi-defendant ISIL-related trial, Mohamed Farah, Abdirahman Daud and Guled Omar were convicted of conspiring to provide material support to the foreign terrorist organization and other federal offenses,” said Assistant Attorney General Carlin. “The defendants conspired with a larger group of individuals to travel to Syria to fight on behalf of ISIL. Countering terrorist threats remains the highest priority of the National Security Division. We will continue to work to disrupt the recruitment and radicalization of Americans by terrorist organizations, and bring to justice those who conspire to provide material support to terrorists. I would like to thank the many agents, analysts and prosecutors who worked tirelessly to secure this conviction.”
Between May 2014 and their arrests on April 19, 2015, these three defendants and their co-conspirators made multiple attempts to join the Islamic State of Iraq and the Levant (ISIL) in Syria.
In May 2014, some members of the conspiracy, including defendant GULED OMAR and co-conspirators ABDI NUR, ABDULLAHI YUSUF, traveled or attempted to travel to Syria to join ISIL. To facilitate the travel of his co-conspirators, defendant DAUD provided contact information for an ISIL member in Turkey to NUR and YUSUF so they could gain assistance crossing the border from Turkey into Syria. NUR succeeded in his plan, joining ISIL in Syria in June 2014. YUSUF was stopped at the Minneapolis/ St. Paul Airport and was later arrested.
Also in May 2014, defendant OMAR and two other members of the conspiracy made an attempt to join ISIL by traveling across the United States – Mexico border near San Diego. This planned failed when members of defendant OMAR’s family prevented his travel.
In October 2014, members of conspiracy communicated with “Antar,” a self-described member of ISIL in Syria, about how best to travel to Syria to join ISIL. Members of conspiracy met with one another to discuss routes, methods and the timing of leaving the United States to join ISIL in Syria.
Defendant OMAR again attempted to join ISIL in Syria on November 6, 2014, by first flying from Minneapolis/St. Paul International Airport to San Diego, California. Again, defendant OMAR planned to cross the United States – Mexico border near San Diego and travel onward to Syria to join ISIL. Before he could board the flight in Minnesota, OMAR was stopped at the airport and prevented from boarding the plane. In order to fund this second attempt to join ISIL in Syria, OMAR intended to use federal financial aid provided to him by the United States Department of Education to attend college.
Also in November 2014, defendant FARAH and three of his co-conspirators, defendants ZACHARIA ABDURAHMAN, HANAD MUSSE, and HAMZA AHMED, took a Greyhound bus to New York City and attempted to board flights to Europe. Defendant FARAH’s ultimate destination was Syria, where he planned to join and fight with ISIL. Federal agents in New York prevented defendant FARAH and his three co-conspirators from traveling.
In April 2015, defendants DAUD and FARAH drove from Minneapolis to San Diego, Calif., where they intended to purchase fake passports, cross the border into Mexico, travel to Syria to join ISIL. Unbeknownst to them, the individual from whom they purchased the fake passports was a law enforcement officer and both were arrested by federal agents immediately after obtaining the phony travel documents.
Ten Minnesotans were charged as part of this conspiracy to provide material support to ISIL. The men are all associates and friends of one another. Six defendants pleaded guilty before trial and one, ABDI NUR, joined ISIL in Syria in June 2015.
This case is the result of an investigation conducted by the FBI-led Joint Terrorism Task Force.
The case is being prosecuted by Assistant United States Attorneys Andrew Winter, John Docherty, and Julie Allyn, with assistance provided by the National Security Division’s Counterterrorism Section.
Special thanks to San Diego and New York Field Offices of the FBI and the United States Attorney’s Office in the Southern District of California.
Defendant Information:
GULED ALI OMAR, 21
Minneapolis, Minn.
Convicted:
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Conspiracy to Murder Outside the United States, 1 count
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Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
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Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 2 counts
- Attempted Financial Aid Fraud, 1 count
MOHAMED ABDIHAMID FARAH, 22
Minneapolis, Minn.
Convicted:
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Conspiracy to Murder Outside the United States, 1 count
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Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
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Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 2 counts
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Perjury, 1 count
- False Statement, 1 count
ABDIRAHMAN YASIN DAUD, 22
Minneapolis, Minn.
Convicted:
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Conspiracy to Murder Outside the United States, 1 count
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Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
-
Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 1 count
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
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Jury Convicts Brandon Scott Woodley in Federal Court of Being A Convicted Felon in Possession of AmmunitionRead the Press Release
KNOXVILLE, Tenn. – On June 2, 2016, after a two-day trial in U.S District Court, a federal jury convicted Brandon Scott Woodley, 34, of Knoxville, Tenn., of knowingly possessing ammunition after having previously been convicted of a felony. Woodley has been in custody since his arrest in September 2015, following an August 2015 shooting in a west Knoxville hotel parking lot. Witnesses testified at trial that Woodley shot a co-worker during an argument and fled the scene with the gun; however, some ammunition from the shooting was recovered in the parking lot.
In 2009 Woodley pleaded guilty in the same court of being a convicted felon in possession of a cache of firearms.
Sentencing was set for Oct. 3, 2016, before the Honorable R. Leon Jordan, Senior U.S District Court Judge. Woodley faces a maximum sentence of 10 years in prison, plus another two years in prison for violating the supervised release he was serving following his prison sentence for the 2009 conviction.
The investigation was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Knoxville Police Department. Assistant U.S. Attorney Matthew Morris represented the United States.
This case was brought as part of Project Safe Neighborhoods (“PSN”), a comprehensive national strategy that creates local partnerships with law enforcement agencies to effectively enforce existing gun laws. It provides more options to prosecutors, allowing them to utilize local, state, and federal laws to ensure that criminals who commit gun crime face tough sentences. PSN gives each federal district the flexibility it needs to focus on individual challenges that a specific community faces.
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Investment Adviser Charged in Manhattan Federal Court with Insider TradingRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and Diego Rodriguez, the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced the arrest of DAVID HOBSON, who served as an investment adviser in the Providence, Rhode Island, offices of two different national broker-dealer and investment advisers (“Brokerage Firm-1” and “Brokerage Firm-2”), for engaging in a scheme to commit insider trading in connection with deals involving a pharmaceutical company (the “Pharma Company”) at which MICHAEL MACIOCIO, HOBSON’s friend and client, worked. In addition, Mr. Bharara announced the unsealing of charges against MACIOCIO, who pled guilty and admitted to his participation in the scheme in May. MACIOCIO, who had been employed by the Pharma Company, regularly possessed material, nonpublic information (“Inside Information”) concerning pending acquisitions and transactions under consideration by the Pharma Company. From at least 2008 through April 2014, MACIOCIO breached his duty of confidentiality to the Pharma Company by providing Inside Information about potential acquisitions and transactions to his friend and long-time broker, HOBSON. HOBSON, in turn, used the Inside Information to execute profitable securities trades for himself, for MACIOCIO, and for other clients of HOBSON’s.
HOBSON was arrested this morning in Providence, Rhode Island, and was presented today before a magistrate judge in Providence. The case against HOBSON and MACIOCIO is before United States District Judge Laura Taylor Swain. On Friday, May 20, 2016, MACIOCIO pled guilty before United States Magistrate Judge Barbara Moses to an Information charging him with conspiracy to commit securities fraud, conspiracy to commit wire fraud, and securities fraud.
In a separate action, the Securities and Exchange Commission (“SEC”) filed civil charges against HOBSON and MACIOCIO.
U.S. Attorney Preet Bharara said: “As alleged, Michael Maciocio abused his position at a major pharmaceutical company to feed insider information to his friend and broker, David Hobson, who allegedly helped both benefit from trades based on that illegal edge. Unfortunately, illegal insider trading remains a blight on our securities markets and we will continue to work with the FBI to investigate and prosecute it.”
FBI Assistant Director-in-Charge Diego Rodriguez said: “Having material, nonpublic information on public companies is a trusted privilege that should be used to carry out business matters, not used as advantage on which to trade and profit. As alleged, Michael Maciocio used his position at a pharmaceutical company to share nonpublic information with his friend and long-time broker, David Hobson. Hobson allegedly used traded on the information, for both Maciocio and other clients, profiting all parties $370,000. Keeping our markets fair for all investors remains a top priority for the FBI and we will continue to work with our law enforcement partners to bring charges against those who use illegal and unfair advantages in our securities markets.”
According to the allegations in the charging documents unsealed today in Manhattan federal court, including the Information and Indictment[1], and statements made in court proceedings:
From in or about May 2008 through in or about April 2014, MACIOCIO and HOBSON participated in a scheme to commit insider trading in advance of and in connection with acquisitions and transactions under consideration by the Pharma Company. MACIOCIO and HOBSON were childhood friends and HOBSON had served as MACIOCIO’s investment adviser and broker for many years.
MACIOCIO learned about the impending transactions through his role as a Master Planner in the Active Pharmaceutical Ingredient Supply Chain Group at the Pharma Company. In that role, MACIOCIO was tasked with evaluating manufacturing demands and capacity within the Pharma Company and was consulted about potential acquisitions to assist in determining whether the Pharma Company would be able to manufacture any new product in-house. Although MACIOCIO was not typically provided with the name of the target acquisition, he used the Inside Information he received – including the Pharma Company’s code name of the acquisition, the drug indication, the dosage, the phase of any clinical trial, and the chemical structure of the drug – to uncover the true identity of the target company. He was at times aided in this task by HOBSON.
Having learned the Inside Information about these impending transactions, MACIOCIO, in breach of fiduciary duties and other duties of trust and confidence owed to the Pharma Company, traded on his own behalf and tipped HOBSON so that HOBSON could use the information to trade for both himself and for MACIOCIO. HOBSON also used the Inside Information to trade in other of his clients’ accounts, first at Brokerage Firm-1 and later at Brokerage Firm-2.
HOBSON used the Inside Information that he received from MACIOCIO to make profitable trades in, among other securities: Medivation, Inc., Ardea Biosciences, Inc., and Furiex Pharmaceuticals, Inc. As a result of the scheme, HOBSON reaped approximately $180,000 in ill-gotten gains for himself, $40,000 for MACIOCIO, and nearly $150,000 for certain of HOBSON’s other clients.
* * *
HOBSON, 47, is charged with one count of conspiracy to commit securities fraud, one count of conspiracy to commit wire fraud, and two counts of securities fraud. Count One carries a maximum sentence of five years in prison. Counts Two through Four each carry a maximum sentence of 20 years in prison. The charges also carry a maximum fine of $5 million, or twice the gross gain or loss from the offense.
On May 20, 2016, MACIOCIO, 46, pled guilty before Judge Moses to one count of conspiracy to commit securities fraud, one count of conspiracy to commit wire fraud, and two counts of securities fraud. Count One carries a maximum sentence of five years in prison. Counts Two through Four each carry a maximum sentence of 20 years in prison. The charges also carry a maximum fine of $5 million, or twice the gross gain or loss from the offense.
The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentences for the defendants will be determined by the judge.
Mr. Bharara praised the work of the FBI, and thanked the SEC.
The charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Aimee Hector and Rebecca Mermelstein are in charge of the prosecution.
The allegations contained in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the descriptions of the Indictment set forth below constitute only allegations, and every fact described should be treated as an allegation.