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Friday 8 April 2016
Mother Daughter Duo Charged in Theft SchemeRead the Press Release
PHILADELPHIA – Madeline Rosario, 25, and Maribel Nunez, 58, both of Philadelphia, PA, were charged by indictment, unsealed today, in an aggravated identity theft scheme to defraud the IRS, announced United States Attorney Zane David Memeger. Rosario is charged with conspiracy, theft of government property and aggravated identity theft. Her mother is charged with conspiracy and theft of government property.
According to the indictment, between November of 2010 and March of 2014, the defendants controlled five business accounts at Wachovia/Wells Fargo bank for the purpose of depositing fraudulently obtained United States Treasury refund checks and 3rd party refund checks. It is alleged that they conspired with others, to commit theft of government funds and knowingly converted to their own approximately 84 fraudulent tax refund U.S. Treasury checks totaling approximately $439,843.69. Rosario and Nunez allegedly opened and controlled the five business accounts at Wachovia/Wells Fargo Bank. The accounts were then used for depositing the fraudulently obtained tax refund checks.
If convicted, Rosario faces a two year mandatory minimum sentence with a statutory maximum sentence of 15 years and a $300 special assessment; Nunez faces a maximum statutory sentence of 15 years and a $200 special assessment. Both defendants could also face fines and a period of supervised release.
The case was investigated by IRS Criminal Investigations and the FBI. It is being prosecuted by Assistant United States Attorney Maureen McCartney.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Middletown Man Sentenced to 17 Years in Prison for Robbery Spree in Orange and Sullivan CountiesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that JOHN CREWS, JR., was sentenced today in White Plains federal court to a prison term of 17 years for his participation in a series of armed robberies in the summer of 2013. CREWS pled guilty on September 21, 2015, to conspiring to commit armed robberies and brandishing a firearm in the course of those robberies. CREWS pled guilty before U.S. District Judge Vincent L. Briccetti, who imposed today’s sentence.
According to the allegations contained in the Indictment, and information adduced during the Court proceedings:
In the summer of 2013, CREWS and others carried out a string of armed robberies in Orange County and Sullivan County. In a span of approximately six weeks, Crews participated in 10 robberies. He and others robbed two gas stations, a bar, a bakery, three stores, and a restaurant. They also carried out two home invasions. The robberies were in Middletown, Wallkill, and Monticello. CREWS brandished a gun during each of the robberies.
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In addition to his prison term, CREWS, 28, of Middletown, New York, was sentenced to three years of supervised release and was ordered to pay restitution in the amount of $5,577 to various establishments that he robbed.
Mr. Bharara praised the outstanding investigative work of the Bureau of Alcohol, Tobacco, Firearms and Explosives, the New York State Police, the City of Middletown Police Department, the Town of Wallkill Police Department, the Village of Monticello Police Department, the Orange County District Attorney’s Office, and the Sullivan County District Attorney’s Office.
The prosecution is being handled by the Office’s White Plains Division. Assistant U.S. Attorneys Michael Gerber and Lauren Schorr are in charge of the prosecution.
Mexican National Arrested on Federal Heroin and Cocaine Trafficking ChargesRead the Press Release
ALBUQUERQUE – Diego Mauricio Curiel-Cervantes, 22, a Mexican national, made his initial appearance today in federal court in Albuquerque, N.M., on a criminal complaint charging him with heroin and cocaine trafficking offenses. Curiel-Cervantes remains in federal custody pending a preliminary hearing and a detention hearing scheduled for April 11, 2016.
Curiel-Cervantes was arrested early this morning after the DEA agents allegedly found 1.30 gross kilograms (2.6 pounds) of heroin and 3.45 gross kilograms (7.59 pounds) of cocaine concealed in his luggage at the Greyhound Bus Station in Albuquerque.
If convicted on the charges in the criminal complaint, Curiel-Cervantes faces a statutory penalty of a mandatory minimum of ten years and a maximum of life in federal prison. Charges in criminal complaint are merely accusations, and defendants are presumed innocent unless found guilty beyond a reasonable doubt.
This case was investigated by the Albuquerque office of the DEA and is being prosecuted by Assistant U.S. Attorney Paul H. Spiers.
The New Mexico Heroin and Opioid Prevention and Education (HOPE) Initiative was launched in January 2015 by the UNM Health Sciences Center and the U.S. Attorney’s Office in response to the national opioid epidemic which has had a disproportionately devastating impact on New Mexico. Opioid addiction has taken a toll on public safety, public health and the economic viability of our communities. Working in partnership with Bernalillo County, the Albuquerque City Council, DEA, Healing Addiction in our Community (HAC) and other community stakeholders, HOPE’s principal goals are to protect our communities from the dangers associated with heroin and opioid painkillers and reducing the number of opioid-related deaths in New Mexico.
The HOPE Initiative is comprised of five components: (1) prevention and education; (2) treatment; (3) law enforcement; (4) reentry; and (5) strategic planning. HOPE’s law enforcement component is led by the Organized Crime Section of the U.S. Attorney’s Office and the DEA in conjunction with their federal, state, local and tribal law enforcement partners. Targeting members of major heroin and opioid trafficking organizations for investigation and prosecution is a priority of the HOPE Initiative. Learn more about the New Mexico HOPE Initiative at http://www.HopeInitiativeNM.org.
Methamphetamine Trafficker Convicted in Federal CourtRead the Press Release
G. F. Peterman, III, Acting United States Attorney for the Middle District of Georgia, announced the conviction today of Jose Alberto Sandoval Moya of Douglas, Coffee County, Georgia of conspiracy to possess with the intent to distribute methamphetamine weighing more than 50 grams. The verdict was returned in United States District Court in Albany, Georgia, before the Honorable W. Louis Sands, Senior United States District Judge. This conviction exposes Sandoval Moya to a potential range of sentence of a mandatory minimum term of imprisonment of ten (10) years up a maximum possible term of imprisonment of life.
Evidence presented during the trial showed that Sandoval Moya conspired together with Raymond Riviera Cortez, also of Douglas, Georgia, and Corrinne Gillis of Fitzgerald, Georgia, to possess with the intent to distribute methamphetamine. The evidence further revealed that Sandoval Moya arranged for Gillis to travel to Mexico on three occasions to bring methamphetamine to South Georgia for distribution. The conspiracy concluded when Gillis was arrested at the US/Mexico Border at the Matamoros, Mexico/Brownsville, Texas crossing in possession of over 17 kilograms (over 43 pounds) of 100% pure methamphetamine, the largest seizure ever made at that point of entry into this country. The drug had been hidden in the tires of the vehicle in order to smuggle it past authorities at the border. Each tire contained between 10 and 12 pounds of methamphetamine.
Sentencing for Mr. Moya should take place in approximately 60 days.
“The quantity of this seizure and the testimony at trial regarding the smuggling of other amounts on previous occasions show that Mr. Moya was without doubt a major source of methamphetamine in South Georgia. This conviction will remove a substantial supplier from the illegal drug stream in our state,” said Acting United States Attorney G. F. “Pete” Peterman, III.
The case was investigated by the Georgia Bureau of Investigation, Sylvester Regional Office, the Sheriff’s Offices of Ben Hill and Coffee County, Georgia and by Department of Homeland Security. It was prosecuted by AUSA Leah McEwen.
Inquiries regarding the case should be directed to Pamela Lightsey, Public Affairs Specialist, United States Attorney’s Office at (478) 621-2603.
Message to Potential Tax Cheats from Federal Prosecutors: Tax Crimes Result in Criminal Prosecution, Lengthy Prison Sentences and FinesRead the Press Release
CHARLOTTE, NC - With the deadline for filing income tax returns rapidly approaching, Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina, and Thomas J. Holloman, III, Special Agent in Charge, Charlotte Field Office, IRS Criminal Investigation, jointly announce recent tax fraud prosecutions and sentencings, and deliver a powerful warning to those who are thinking about breaking the law by committing tax crimes.
“During this time of the year, IRS will receive millions of tax returns from honest taxpayers who file their returns on time and pay taxes they owe,” said U.S. Attorney Rose. “Today’s warning is not for them. Today’s warning is for tax cheats who break tax laws and abuse our tax system. If you belong in this category, pay close attention. My office will hold accountable anyone who participates in a tax fraud scheme that puts an added tax burden on honest taxpayers and drains our public finances.”
“Tax fraud exists in many forms, from unscrupulous tax preparers filing false and fraudulent returns, to identity thieves, and to those that go complex lengths to hide their income and evade paying the taxes they owe. If you are considering engaging in this criminal activity, you will be caught.” said Special Agent in Charge Holloman. “There is no offseason for IRS Criminal Investigation, as we continue to engage in a year-round effort to investigate potential criminal violations of the Internal Revenue Code and other financial related crimes, in a manner that fosters confidence in the tax system and compliance with the laws. IRS Criminal Investigation will continue to vigorously pursue those who unjustly enrich themselves through tax fraud schemes.”
On March 16, 2016, Frank Alton Moody, II, an operator of Charlotte-area payroll services company CenterCede Services, Inc., was indicted for failing to pay more than $9 million in federal payroll taxes to the IRS that had been withheld on behalf of CenterCede’s clients. According to the indictment which was unsealed yesterday, Moody instructed and supervised others to prepare, sign and file employer’s quarterly federal tax return, Forms 941 and thereafter did not remit payment of taxes reflected. (3:16-cr-00070).
The prosecution of Moody for his role in failing to pay over employment taxes is just one example of our district’s commitment to prosecuting tax cheats including those who cheat on their own taxes, those who prepare false tax returns for others, and those who file fraudulent tax returns using stolen identity information.
TAX EVASION AND FILING FALSE TAX RETURNS.
Over the last year, the U.S. Attorney’s Office has prosecuted and convicted numerous individuals for omitting income from their individual tax returns, and defendants have received substantial sentences for tax charges, ranging from several years in prison to home confinement. For example, the following individuals were sentenced for lying to the IRS about their taxable income:
Amy Hilty (3:15-cr-00233), an accountant and former resident of Stanley, N.C., was sentenced to 18 months in prison in February 2016. Hilty pleaded guilty to tax evasion for hiding more than $520,000 in personal income from the IRS and failing to file tax returns for years 2008 through 2011. Hilty also pleaded guilty to wire fraud.
Jarrett Mitchem (1:14-cr-00035), a resident of Hendersonville, N.C. maintained a UBS bank account with a balance of approximately $4M and failed to report the earnings from the foreign investments on his 2005 - 2008 tax returns. He was sentenced in February 2016 to nine months in prison and three months of home confinement.
Sammie Marks (3:15-cr-00125), a resident of Matthews, N.C., owned and operated a metal and salvage business and failed to report more than $1.1 million of income he received from his business during years 2009 through 2013. Marks was sentenced in December 2015 to one year and one day in prison.
Janice Terry-Kidd (3:14-cr-00243), a resident of Huntersville, N.C., embezzled approximately $526,000.00 from her employer, Wilburn Auto Body, from 2008 to 2013. As a Human Resource Officer responsible for payroll, Terry-Kidd used the social security number of a previous employee to create fraudulent payroll checks and direct them to be deposited into her personal bank account. In addition, Terry-Kidd failed to report income from the embezzled payroll checks on her own personal income tax return resulting in approximately $106,000.00 of tax due and owing. Terry-Kidd was sentenced in November 2015 to 33 months in prison.
Teng Lor (3:15-cr-00080), a resident of Matthews, N.C., and the owner of T&C Equipment, Inc. and LOR Enterprises, Inc. which operated Laundromats in the Charlotte area concealed gross receipts and taxable income of more than $545,000 from the IRS for the 2010 through 2012 years. Lor was sentenced in October 2015 to six months in prison and six months of home confinement.
Mark Le (3:14-cr0010), a Huntersville physician, hid approximately $2.4 million in personal income from the IRS in 2009 and 2010 by falsely claiming that certain payments were business expenses of his medical practice. Le used these funds to purchase and construct a $2.4 million 8000-square foot residence on Lake Norman. Le, who pled guilty to tax evasion and health care fraud, was sentenced to 18 months in prison in September 2015.
FRAUDULENT RETURN PREPARERS
Our office diligently works to investigate and prosecute unscrupulous tax return preparers. Examples of prosecutions of tax return preparers during the last year include:
Malik Shropshire (3:15-cr-00025), a resident of Charlotte, he was sentenced in February 2016 to 51 months in prison for filing false tax returns and lying on a loan application. Shropshire worked as a tax return preparer and aided and assisted in the preparation of hundreds of false tax returns, that included, among other things, false Schedule C businesses, false dependents, and false refundable education credits.
Fitzroy Lawrence (3:15-cr-00057), a resident of Charlotte, he was sentenced in February 2016 to 27 months in prison for filing false tax returns. Lawrence aided and assisted in the preparation of hundreds of false tax returns which were filed with the IRS, seeking fraudulent tax refunds totaling approximately $2.6 million.
STOLEN IDENTITY REFUND FRAUD
In addition to prosecuting tax evaders and fraudulent tax return preparers, our office also investigates and prosecutes those individuals who steal the identities of taxpayers to file fraudulent tax returns. Examples include:
Yolanda Tiess Kitson (1:13-cr-00031), was sentenced to 72 months in prison and ordered to pay restitution of more than $3.9 million for her role in a fraudulent tax refund scheme involving using stolen identities to obtain fraudulent tax refunds.
Cara Michelle Banks (1:15-cr-00032) pleaded guilty for her role in the same fraudulent tax refund scheme as Kitson and is awaiting sentencing.
Federal penalties for each count of conviction of tax crimes range from a maximum of one year in prison and a $100,000 fine for failure to file a tax return, false withholding exemptions, and delivering or disclosing false tax documents, to a maximum of 10 years in prison and a $250,000 fine for conspiracy to defraud with respect to false refund claims. Other penalties include a mandatory term of two years in prison and a $250,000 fine for aggravated identity theft charges, three years in prison and a $250,000 fine for obstructing or impeding an investigation and filing or preparing a false tax return, and a maximum of five years in prison and a $250,000 fine for tax evasion, failure to pay taxes, conspiracy to commit a tax offense or conspiracy to defraud.
The U.S. Attorney’s Office and the IRS remind tax payers to exercise caution during tax season to protect themselves against a wide range of tax schemes ranging from identity theft to return preparer fraud. Illegal scams can lead to significant penalties and interest and possible criminal prosecution. IRS Criminal Investigation works closely with the Department of Justice to shutdown scams and to prosecute the criminals behind them. The IRS has issued its annual “Dirty Dozen” which lists common tax scams that taxpayers may encounter, particularly during filing season. Taxpayers are urged look out for, and to avoid, the following common schemes:
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Identity Theft
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Phone Scams
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Phishing
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Return Preparer Fraud
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Offshore Tax Avoidance
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Inflated Refund Claims
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Fake Charities
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Falsely Padding Deductions on Returns
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Excessive Claims for Business Credits
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Falsifying Income To Claim Credits
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Abusive Tax Shelters
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Frivolous Tax Arguments
Education is the best way to avoid these common schemes. To learn more about the Dirty Dozen scams and for help with recognizing and avoiding abusive tax schemes, the IRS offers educational material at www.irs.gov. Suspected tax fraud can be reported to the IRS using Form 3949-A found on the IRS.gov website.
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Member of International Child Exploitation Conspiracy Sentenced to 21 Years in PrisonRead the Press Release
A member of an international child exploitation conspiracy was sentenced to 21 years in prison today for his participation in two websites that were operated for the purpose of coercing and enticing minors as young as eight years old to engage in sexually explicit conduct on web camera.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Dana J. Boente of the Eastern District of Virginia and Section Chief Calvin A. Shivers of the FBI’s Violent Crimes Against Children Section (VCACS) made the announcement.
Brian K. Hendrix, 42, of Mt. Juliet, Tennessee, was sentenced by U.S. District Judge T.S. Ellis III of the Eastern District of Virginia, who also ordered Hendrix to serve a 10 year term of supervised release. Hendrix will also be required to register as a sex offender. In January, Hendrix was convicted at trial by a federal jury on child pornography charges. The investigation, Operation Subterfuge, identified more than 300 minor victims in the United States and an estimated 1,600 minor victims were lured to the websites.
According to evidence presented at trial, Hendrix’s co-conspirators created false profiles on social networking sites, such as YouTube, posing as young teenagers to lure children to the websites they controlled. Once children were on the conspirators’ websites, the conspirators, including Hendrix, showed the children pre-recorded videos of prior minor victims, often engaging in sexually explicit conduct, to make the new victims think that they were chatting with another minor. Using these videos, Hendrix and co-conspirators coerced and enticed children to engage in sexually explicit activity on their own web cameras, which the website automatically recorded. Conspirators earned points based on their contribution to the success of website objectives, which allowed them access to the sexually exploitative videos of children. Several of these sexually exploitative videos were found on digital devices belonging to Hendrix. Law enforcement agencies have disabled both websites.
Trial Attorney Lauren Britsch of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Tracy Doherty-McCormick of the Eastern District of Virginia prosecuted the case. CEOS Trial Attorney Ravi Sinha assisted with the prosecution.
VCACS special agents led the investigation with the assistance of the FBI’s Operation Rescue Me and the FBI’s Digital Analysis and Research Center. The South Africa Police Service, Family Violence, Child Protection and Sexual Offenses, Gauteng; Dutch Police Service Agency, KLPD; Royal Canadian Mounted Police, National Child Exploitation Coordination Centre; and the Australian Federal Police, Child Protection Operations, Sydney were active partners in the investigation. The U.S. Attorney’s Office of the Middle District of Tennessee contributed to the investigation and the prosecution.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Maryland Man Sentenced to Prison for Conspiracy to Commit Bank FraudRead the Press Release
ALEXANDRIA, Va. – Kyle Cary, 25, of Hyattsville, Maryland, was sentenced today to 40 months in prison and three years of supervised release for conspiracy to commit bank fraud for his role in a five-year check fraud and identity theft conspiracy.
Cary pleaded guilty on January 8. As detailed in the below chart, seven co-conspirators were previously sentenced to significant prison terms for their roles in this same conspiracy.
According to statements of fact filed with the plea agreements, Ray Ekobena and his younger brother, Stefan Ekobena, printed fraudulent checks using victims’ bank account information. The Ekobenas obtained victims’ bank account information by enlisting bank tellers and other insiders who had access to sensitive personal information through their employment. The Ekobenas also employed a network of recruiters. One such recruiter was Cary (aka Hugo Stacks), who would recruit bank account holders to provide him with their debit card, the PIN for the debit card, and other information which Cary would then provide to his co-conspirators via middlemen such as Gani Cole and Rodney Hardy. Co-conspirators such as Jerome Johnson, Deallto Davis and Alan Lamin also furthered the conspiracy by depositing the fraudulent checks into bank accounts under false names and withdrawing the resulting funds before the banks discovered the fraud.
In total, the conspiracies victimized over 200 individuals and caused an actual loss amount of $712,231. Victims include well-known small businesses and charities, including the Leukemia & Lymphoma Society.
Name
Age
Hometown
Sentencing Information
Ray Ekobena
27
Alexandria
Sentenced Nov. 6, 2015 to 104 months in prison and three years of supervised release. Ordered to forfeit $712,231.22 and pay that amount in restitution.
Stefan Ekobena
24
Atlanta, Georgia
Sentenced Nov. 6, 2015 to 66 months in prison and three years of supervised release. Ordered to forfeit $199,808.29 and pay that amount in restitution.
Rodney Hardy
25
Hyattsville, Maryland
Sentenced Nov. 6, 2015 to 30 months in prison and three years of supervised release. Ordered to forfeit $20,618.41 and pay that amount in restitution.
Jerome Johnson
32
Washington, D.C.
Sentenced Dec. 4, 2015 to 30 months in prison and three years of supervised release. Ordered to forfeit $100,000.00 and pay $19,091.30 in restitution.
Deallto Davis
20
Washington, D.C.
Sentenced on Dec. 4, 2015 to 6 months in prison and three years of supervised release. Ordered to forfeit $7,678.24 and pay $60,954.75 in restitution.
Gani Cole
27
Bryans Road, Maryland
Sentenced on April 1, 2016 to 30 months in prison and three years of supervised released. Ordered to forfeit $5,247.48 and pay that amount in restitution.
Kyle Cary
25
Hyattsville, Maryland
Sentenced today to 40 months in prison and three years of supervised released. Ordered to forfeit $78,000.00 and pay $18,906.27 in restitution.
Alan Lamin
25
Washington, D.C.
Sentenced July 8, 2015 to 54 months in prison and three years of supervised release. Ordered to pay $124,640 in restitution.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Maria Kelokates, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service (USPIS); Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office; and Colonel Edwin C. Roessler Jr., Chief of the Fairfax County Police Department, made the announcement after sentencing by U.S. District Judge Claude M. Hilton. Assistant U.S. Attorney Kellen S. Dwyer and Special Assistant U.S. Attorney Joseph V. Longobardo 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. 1:15-cr-180 and 1:15-cr-327.
Manhattan U.S. Attorney Announces $1.2 Billion Settlement of Its Claims Against Wells Fargo Bank, N.A., for Improper Mortgage Lending PracticesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Julián Castro, Secretary of the U.S. Department of Housing and Urban Development (“HUD”), Benjamin C. Mizer, Principal Deputy Assistant Attorney General for the Justice Department’s Civil Division, Brian J. Stretch, United States Attorney for the Northern District of California, and David A. Montoya, Inspector General of HUD (“HUD-OIG”), announced today that the United States has settled civil mortgage fraud claims against WELLS FARGO BANK, N.A. (“WELLS FARGO” or the “Bank”), and WELLS FARGO executive KURT LOFRANO (“LOFRANO”), stemming from WELLS FARGO’s participation in the Federal Housing Administration (“FHA”) Direct Endorsement Lender Program. In the settlement, WELLS FARGO agreed to pay $1.2 billion and admitted, acknowledged, and accepted responsibility for, among other things, certifying to HUD, during the period from May 2001 through December 2008, that certain residential home mortgage loans were eligible for FHA insurance when in fact they were not, resulting in the Government having to pay FHA insurance claims when certain of those loans defaulted. The agreement resolves the United States’ civil claims in its lawsuit in the Southern District of New York, as well as an investigation conducted by the U.S. Attorney’s Office for the Southern District of New York regarding WELLS FARGO’s FHA origination and underwriting practices subsequent to the claims in its lawsuit, and an investigation conducted by the U.S. Attorney’s Office for the Northern District of California into whether American Mortgage Network, LLC (“AMNET”), a mortgage lender acquired by WELLS FARGO in 2009, falsely certified and submitted ineligible residential mortgage loans for FHA insurance.
The settlement was approved today by U.S. District Judge Jesse M. Furman.
Manhattan U.S. Attorney Preet Bharara said: “Today, Wells Fargo, one of the biggest mortgage lenders in the world, has been held responsible for years of reckless underwriting, while relying on government insurance to deal with the damage. Wells Fargo has long taken advantage of the FHA mortgage insurance program, designed to help millions of Americans realize the dream of home ownership, to write thousands and thousands of faulty loans. Driven to maximize profits, Wells Fargo employed shoddy underwriting practices to drive up loan volume, at the expense of loan quality. Even though Wells Fargo identified through internal quality assurance reviews thousands of problematic loans, the Bank decided not to report them to HUD. As a result, while Wells Fargo enjoyed huge profits from its FHA loan business, the government was left holding the bag when the bad loans went bust. With today’s settlement, Wells Fargo has finally resolved the years-long litigation, adding to the list of large financial institutions against which this Office has successfully pursued civil fraud prosecutions.”
HUD Secretary Julián Castro said: “This Administration remains committed to holding lenders accountable for their lending practices. The $1.2 billion settlement with Wells Fargo is the largest recovery for loan origination violations in FHA’s history. Yet, this monetary figure can never truly make up for the countless families that lost homes as a result of poor lending practices.”
Principal Deputy Assistant Attorney General Benjamin C. Mizer said: “This settlement is another step in the Department of Justice’s continuing efforts to hold accountable FHA approved lenders that unlawfully submitted false claims at the expense of American homeowners and taxpayers. In addition to today’s resolution with Wells Fargo, the department has pursued similar misconduct by numerous other lenders, returning more than $4 billion to the FHA fund and the Treasury and filing suit where appropriate. We remain committed to protecting the public fisc from all who seek to abuse it, whether they do business on Wall Street or Main Street.”
Northern District of California U.S. Attorney Brian Stretch said: “Misconduct in the mortgage industry helped lead to a destructive financial crisis that spanned the globe. American Mortgage Network’s origination of FHA-insured loans that did not comply with Government requirements also caused major losses to the public fisc. Today’s settlement demonstrates the Department of Justice’s resolve to pursue remedies against those who engaged in this type of misconduct.”
HUD Inspector General David A. Montoya said: “This matter is not just a failure by Wells Fargo to comply with federal requirements in FHA’s Direct Endorsement Lender program – it’s a failure by one of our trusted participants in the FHA program to demonstrate a commitment to integrity and to ordinary Americans who are trying to fulfill their dreams of homeownership.”
According to the Second Amended Complaint filed in Manhattan federal court:
WELLS FARGO has been a participant in the Direct Endorsement Lender program, a federal program administered by FHA.As a Direct Endorsement Lender, WELLS FARGO has the authority to originate, underwrite, and certify mortgages for FHA insurance.If a Direct Endorsement Lender approves a mortgage loan for FHA insurance and the loan later defaults, the holder or servicer of the loan may submit an insurance claim to HUD for the outstanding balance of the defaulted loan, along with any associated costs, which HUD must then pay.Under the Direct Endorsement Lender program, neither FHA nor HUD reviews a loan for compliance with FHA requirements before it is endorsed for FHA insurance.Direct Endorsement Lenders are therefore required to follow program rules designed to ensure that they are properly underwriting and certifying mortgages for FHA insurance and maintaining a quality control program that can prevent and correct any deficiencies in their underwriting.The quality control program requirements include conducting a full review of all loans that go 60 days into default within the first six payments, known as “early payment defaults”; taking prompt and adequate corrective action upon discovery of fraud or serious underwriting problems; and disclosing to HUD in writing all loans containing evidence of fraud or other serious underwriting deficiencies.WELLS FARGO failed to comply with these basic requirements.
First, between at least May 2001 and October 2005, WELLS FARGO, the largest HUD-approved residential mortgage lender, engaged in a practice of reckless underwriting of its retail FHA loans, all the while knowing that it would not be responsible when the defective loans went into default.To maximize its loan volume (and profits), WELLS FARGO elected to hire temporary staff to churn out and approve an ever increasing quantity of FHA loans, but neglected to provide this inexperienced staff with proper training.At the same time, WELLS FARGO’s management applied pressure on its underwriters to approve more and more FHA loans.The Bank also imposed short turnaround times for deciding whether to approve the loans, employed lax underwriting standards and controls, and paid bonuses to underwriters and other staff based on the number of loans approved.Predictably, as a result, WELLS FARGO’s loan volume and profits soared, but the quality of its loans declined significantly. Yet, when WELLS FARGO’s senior management was repeatedly advised by its own quality assurance reviews of serious problems with the quality of the retail FHA loans that the Bank was originating, management failed to implement proper and effective corrective measures, leaving HUD to pay hundreds of millions of dollars in claims for defaulted loans.
Second, WELLS FARGO failed to self-report to HUD the bad loans that it was originating, in violation of FHA program reporting requirements.During the period 2002 through 2010, HUD required Direct Endorsement Lenders to perform post-closing reviews of the loans that they originated and to report to HUD in writing loans that contained fraud or other serious deficiencies.This requirement provided HUD with an opportunity to investigate the defective loans and request reimbursement for any claim that HUD had paid or request indemnification for any future claim, as appropriate.During this nine-year period, WELLS FARGO, through its post-closing reviews, internally identified thousands of defective FHA loans that it was required to self-report to HUD, including a substantial number of loans that had gone into “early payment default.”However, instead of reporting these loans to HUD as required, WELLS FARGO engaged in virtually no self-reporting during the four-year period from 2002 through 2005, and only minimal self-reporting after 2005.
In his capacity as Vice President of Credit-Risk – Quality Assurance at WELLS FARGO, LOFRANO executed on WELLS FARGO’s behalf the annual certifications required by HUD for the Bank’s participation in the Direct Endorsement Lender program for certain years. LOFRANO also organized and participated in the working group responsible for creating and implementing WELLS FARGO’s self-reporting policies and procedures. In contravention of HUD’s requirements, that group failed to report to HUD loans that WELLS FARGO had internally identified as containing material underwriting findings. Moreover, LOFRANO received WELLS FARGO quality assurance reports identifying thousands of FHA loans with material findings – very few of which WELLS FARGO reported to HUD.
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As part of the settlement, WELLS FARGO has admitted, acknowledged, and accepted responsibility for, among other things, the following conduct:During the period from May 2001 through on or about December 31, 2008, WELLS FARGO submitted to HUD certifications stating that certain residential home mortgage loans were eligible for FHA insurance when in fact they were not, resulting in the Government having to pay FHA insurance claims when certain of those loans defaulted.From May 2001 through January 2003, WELLS FARGO’s quality assurance group conducted monthly internal reviews of random samples of the retail FHA mortgage loans that the Bank had already originated, underwritten, and closed which identified for most of the months that in excess of 25 percent of the loans, and in several consecutive months, more than 40 percent of the loans, had a material finding.For a number of the months during the period from February 2003 through September 2004, the material finding rate was in excess of 20 percent. A “material” finding was defined by WELLS FARGO generally as a loan file that did not conform to internal parameters and/or specific FHA parameters, contained significant risk factors affecting the underwriting decision, and/or evidenced misrepresentation.
WELLS FARGO also admitted, acknowledged, and accepted responsibility for the following additional conduct:Between 2002 and October 2005, WELLS FARGO made only one self-report to HUD, involving multiple loans.During that same period, the Bank identified through its internal quality assurance reviews approximately 3,000 FHA loans with material findings.Further, during the period between October 2005 and December 2010, WELLS FARGO only self-reported approximately 300 loans to HUD.During that same period, WELLS FARGO’s internal quality assurance reviews identified more than 2,900 additional FHA loans containing material findings.The Government was required to pay FHA insurance claims when certain of these loans that WELLS FARGO identified with material findings defaulted.
LOFRANO admitted, acknowledged, accepted responsibility for, among other things, the following matters in which he participated:From January 1, 2002, until December 31, 2010, he held the position of Vice President of Credit Risk – Quality Assurance at WELLS FARGO; in that capacity, he supervised the Decision Quality Management group; in 2004, he was asked to organize a working sub-group to address reporting to HUD; in or about October 2005, he organized a working group that drafted WELLS FARGO’s new self-reporting policy and procedures; and during the period October 2005 through December 31, 2010, based on application of the Bank’s new self-reporting policy and by committee decision, WELLS FARGO did not report to HUD the majority of the FHA loans that the Bank’s internal quality assurance reviews had identified as having material findings.
* * *
Mr. Bharara and Mr. Stretch thanked HUD’s Office of General Counsel, HUD-OIG, and the Commercial Litigation Branch of the U.S. Department of Justice’s Civil Division for their extraordinary assistance with the prosecution and settlement of this case.
This case against WELLS FARGO is the latest in a string of civil fraud lawsuits brought by this Office since May 2011 alleging fraudulent lending practices by residential mortgage lenders. In addition to WELLS FARGO, this Office has pursued claims against Citi Mortgage (a subsidiary of Citibank), Flagstar Bank, Deutsche Bank (and a number of its subsidiaries), Countrywide, Bank Of America (“BOA”), former BOA executive Rebecca Mairone, Golden First Mortgage Corp. (“Golden First”), former Golden First owner David Movtady, Allied Home Mortgage Corp. (“Allied”), and former Allied executives Jim Hodge and Jeanne Stell.
Assistant U.S. Attorneys Jeffrey S. Oestericher, Christopher B. Harwood, Rebecca S. Tinio, Caleb Hayes-Deats, and Dominika Tarczynska are in charge of the case.
Man Sentenced to 15 Years in Prison for Producing Sexually Explicit Photos of 11-Year-Old BoyRead the Press Release
Assistant U. S. Attorney Alexandra Foster (619) 546-6735
NEWS RELEASE SUMMARY – April 8, 2016
SAN DIEGO – James Murphy, a retiree living in San Diego, was sentenced today to 15 years in prison for taking sexually explicit photographs of an 11-year-old boy at a Tijuana orphanage.
According to the plea agreement, Murphy, 63, traveled to Tijuana, Mexico from San Diego on November 19, 2015, supposedly to participate in humanitarian work at an orphanage in Mexico. While there, he took sexually explicit pictures of the boy and shared pornographic photos with him. These encounters occurred inside a motor home, which Murphy used as his sleeping quarters while staying at the orphanage in Mexico.
During the sentencing hearing, U.S. District Judge Cathy Ann Bencivengo admonished the defendant for stealing a child’s innocence - which he will never be able to regain. She added her concern that the defendant was preying on children for his own sexual satisfaction.
“For at least the next 15 years, children will be safe from the clutches of this predator,” said U.S. Attorney Laura Duffy. “We will do everything possible to protect vulnerable children wherever they may be.”
“Justice was served today as a serial child predator was sentenced to 15 years in federal prison,” said Dave Shaw, special agent in charge for HSI San Diego. “While we are satisfied and relieved with this sentencing, we will not forget the young victims now left with permanent emotional and physical scars. HSI will continue its tireless work with our law enforcement partners around the world to seek out and bring justice to those who mercilessly exploit children.”
DEFENDANT Case Number: 15CR3175-JM
James Murphy Age: 63
SUMMARY OF CHARGES
Count One
Use of a Child to Produce a Sexually Explicit Visual Depiction, in violation of Title 18, U.S. code Sec. 2251(c)(1).
AGENCY
Immigration and Customs Enforcement’s Homeland Security Investigations
Justice Department Sues to Stop Mississippi Tax Return Preparer from Preparing Federal Tax Returns for OthersRead the Press Release
Return Preparer in De Kalb, Mississippi, Allegedly Overstated Refunds through
Fictitious or Exaggerated Business and Farm Losses and Tax CreditsChristopher Chamberlin, a tax return preparer in De Kalb, Mississippi, has prepared income tax returns for customers that fraudulently overstate the customers’ refunds, according to a civil complaint filed by the Justice Department today. The complaint asks the U.S. District Court for the Southern District of Mississippi to permanently bar Chamberlin from preparing tax returns for anyone other than himself.
According to the complaint, Chamberlin is the sole proprietor of C&T Services LLC, located in De Kalb. The complaint alleges that Chamberlin prepared returns that fraudulently overstated refunds by reporting fictitious or exaggerated expenses on Schedule C, Profit or Loss from Business (Sole Proprietorship) and Schedule F, Profit or Loss from Farming. The falsely claimed Schedule C and Schedule F expenses in turn generated losses that purportedly qualified Chamberlin’s customers to receive or increase the earned income tax credit (EITC) or to otherwise create or maximize refunds, according to the complaint. Based on audit adjustments the Internal Revenue Service (IRS) has made to tax returns prepared and filed by Chamberlin for tax years 2012 and 2013, the suit alleges, the United States estimates that the defendant’s conduct may have cost the U.S. Treasury over $1 million for those years alone.
Return preparer fraud is one of the IRS’s Dirty Dozen Tax Scams for 2016. The IRS has some tips on their website for choosing a tax preparer and has launched a free directory of federal tax preparers. In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Justice Department Opposes Canadian Pacific’s Petition to Establish Voting TrustRead the Press Release
Canadian Pacific’s Proposed Voting Trust Structure Risks Irreversibly Harming Competition
The Department of Justice filed a reply today in opposition to Canadian Pacific Railway Limited’s (“CPRL”) petition for a declaratory order regarding use of a voting trust pending the Surface Transportation Board’s (“STB”) review of a potential merger between Canadian Pacific Railway Company (“CP”) and Norfolk Southern Railway Company (“NS”).
The reply states that the proposed voting trust would fail to preserve the independence of the merging railroads during the pendency of the transaction’s regulatory review and would risk harm to current and future competition. It urges the STB to reject the proposed voting trust structure or, in the alternative, to deny the request for a declaratory order.
“Canadian Pacific’s voting trust proposal would compromise Norfolk Southern’s independence and effectively combine the two railroads prior to completion of the STB’s review,” said Assistant Attorney General Bill Baer of the Justice Department’s Antitrust Division. “That makes no sense. We urge the STB to preserve its ability to review the impact of the proposal on competition and consumers before Canadian Pacific starts scrambling the eggs.”
On March 2, 2016, CPRL, the holding company that owns CP, petitioned the STB for a declaratory order approving a proposed voting trust structure pending the STB’s review of a merger between CP and NS. Under the proposed voting trust structure, CPRL would acquire NS, CP’s stock would be placed in trust, and CP’s current CEO would become CEO of NS. As explained in the filing, this proposed voting trust structure fails under each prong of the STB’s regulatory requirements.
The proposal fails to preserve the independence of NS and CP. In addition, both CP and NS will have the economic incentives and the ability to align their business strategies before a review of the transaction. Finally, the proposal would also make it difficult, if not impossible, to effectuate a successful divestiture if the STB were to reject the merger applications.
The STB is an independent agency. The Administrative Procedure Act provides the STB discretion to issue declaratory orders to terminate a controversy or remove uncertainty.
Jury finds Berkeley County man guilty of stalking ex-girlfriendRead the Press Release
CLARKSBURG, WEST VIRGINIA – A federal jury returned a guilty verdict today convicting John Glenn Bartley, 56, of Inwood, West Virginia, of multiple federal stalking charges, United States Attorney William J. Ihlenfeld, II, announced.
Evidence presented at trial indicated that Bartley harassed his former girlfriend by mailing indecent photographs of her to others. Specifically, after the victim ended the relationship with Bartley, Bartley mailed lewd photographs of the victim to her brother, to her ex-husband, and to prior and prospective employers of the victim.
Following a three day trial, a jury found Bartley guilty of three counts of “Stalking” and one count of “Interstate Violation of a Protective Order.” He faces up to five years in prison and a fine of up to $250,000 on each count. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorneys Michael Stein and Sarah Montoro prosecuted the case on behalf of the government. The Federal Bureau of Investigation led the inquiry.
U.S. District Judge Irene M. Keeley presided.
Jury Convicts Two in Identity Theft and Illegal Employment ConspiracyRead the Press Release
HOUSTON - A federal jury in Houston has convicted two El Salvadorian nationals both residing in Houston on all counts as charged in a conspiracy to employ 10 or more unauthorized aliens within a 12-month period, announced U.S. Attorney Kenneth Magidson.
The federal jury sitting in Houston returned guilty verdicts against Rudy Alexander Martinez, 36, and Israel Arquimides Martinez, 44, this afternoon following a two-week trial and approximately six hours of deliberation. Both were convicted of the conspiracy as well as employing unauthorized aliens, encouraging and inducing undocumented aliens to come to reside in the United States and conspiracy to do same as well as aggravated identity theft.
The jury heard that both defendants were employees of a waste disposal company and worked at one of the company’s locations in Houston. Rudy Martinez was a commercial route manager, while Israel Martinez was the residential operations lead driver. From on or around July 30, 2008, and continuing until on or around April 24, 2012, the defendants conspired to hire and continued to employ aliens they knew were unauthorized to work in the U.S. at the company.
Federal law requires employers to hire only U.S. citizens and aliens who are authorized to work here. However, the defendants and others hired manual laborers with little or no regard to their legal work status. Internal audits were conducted, after which the defendants and co-conspirators failed to take corrective measures to ensure the employing company hired workers authorized to work in the country. They also continued to employ undocumented aliens after receiving information, in some cases from the aliens themselves, which would indicate the person was not authorized to work in the U.S.
The jury also heard that the defendants encouraged undocumented aliens to obtain false documentation and assigned false identities to undocumented aliens. In some cases, they also provided the undocumented aliens with employment documents related to the false identity the aliens assumed so they could remain employed as helpers at the waste disposal company’s Houston location.
The individuals whose identities were assumed did not authorize or even know their identities were assumed by these undocumented aliens at the direction and encouragement of the conspirators. These individuals were often former employees of the companies, or individuals who had applied for employment but were never hired. Their information was stolen from documentation and records they executed in connection with their application for employment. The defendants and their co-conspirators would enter these individuals’ information into the payroll system and the undocumented alien would receive a paycheck for their work under the other individual’s name.
On or around Jan. 31, 2012, the defendants and their co-conspirators “fired” at least 10 helpers they knew to be unauthorized aliens purportedly because the aliens failed to supply documentation establishing they were legally present and authorized to work in the U.S. During the “termination” process, the defendants informed and encouraged unauthorized aliens to assume the identity of actual U.S. citizens or individuals who had legal status to reside and work here. They also informed undocumented aliens they could come back to work if they got “good papers” belonging to other individuals. Following their termination, the defendants and their co-conspirators assigned false identities to the terminated aliens and assisted them with obtaining related identifiers to use for employment and payroll purposes. The defendants then “rehired” at least 10 aliens under their assumed identities.
For conspiracy to encourage and induce aliens to reside or encouraging or inducing aliens to reside in the United States, both face up to 10 years in prison and a possible $250,000 fine. For the unlawful employment of unauthorized aliens charges or the conspiracy to so, they also face up to five years in prison as well as a $250,000 fine. In addition, the conviction of aggravated identity theft also carries a mandatory 24 months which must be served consecutively to any other prison term imposed. Sentencing is July 29, 2016.
Following the convictions, the court ordered the defendants into custody.
Agents assigned to Homeland Security Investigations - Worksite Enforcement Unit conducted the investigation leading to the charges. Assistant U.S. Attorneys Casey N. MacDonald and Douglas Davis are prosecuting the case.
Jefferson County Man Charged with Firearm and Heroin OffensesRead the Press Release
On April 5, 2016, L C Richardson, a/k/a "L.C. Richardson," 38, of Mt. Vernon, was charged by indictment with Unlawful Distribution of Heroin and two counts of Unlawful Possession of a Firearm by a Felon, the Acting United States Attorney for the Southern District of Illinois, James L. Porter, announced today.
The indictment alleges that the offenses occurred on January 22, 2016, and January 25, 2016, in Jefferson County. Richardson made his initial appearance in federal court on these charges on April 7, 2016. He was ordered held without bond pending a June 13, 2016, jury trial.
An indictment is a formal charge against a defendant. Under the law, a defendant is presumed to be innocent of a charge until proved guilty beyond a reasonable doubt to the satisfaction of a jury.
The heroin offense carries a maximum penalty of up to 20 years in federal prison, to be followed by 3 years’ supervised release, and a $1,000,000 fine. The firearm offenses carry a maximum penalty of up to 10 years in prison, to be followed by 3 years’ supervised release, and a $250,000 fine.
The ongoing investigation is being conducted by the Jefferson County Sheriff’s Office, Mt. Vernon Police Department, and Bureau of Alcohol, Tobacco, Firearms, and Explosives. The Jefferson County State’s Attorney’s Office also assisted in the investigation.
Jasper Pain Clinic Physician Sentenced to Nearly Three Years in Prison for Illegally Dispensing NarcoticsRead the Press Release
BIRMINGHAM – A federal judge today sentenced a Vestavia Hills physician and owner of a Jasper neurology and pain clinic to nearly three years in prison for dispensing narcotic painkillers without a legitimate medical reason, announced U.S. Attorney Joyce White Vance, Drug Enforcement Administration Assistant Special Agent in Charge Clay A. Morris and Alabama Law Enforcement Agency Sec. Stan Stabler.
U.S. District Judge L. Scott Coogler sentenced Dr. MUHAMMAD WASIM ALI, 51, on 10 counts of unlawfully distributing controlled substances "outside the scope of professional practice and not for a legitimate medical purpose" to three people working undercover with law enforcement. Ali pleaded guilty to the charges in November.
The judge sentenced Ali to 30 months in prison, ordered him to forfeit $2,450 to the government as proceeds of illegal activity, and fined him $85,000. The judge also placed him on supervised release for three years following his prison term. During the supervised release, he cannot work in any medical facility that handles or prescribes controlled substances. In the course of the investigation and prosecution, Ali surrendered both his DEA Controlled Substances Registration, which enabled him to write prescriptions, as well as his medical license. The 30-month sentence, fine and forfeiture are in accord with a binding plea agreement reached between the government and Ali. Ali must report to prison in 30 days.
Ali practiced medicine at the Walker Rural Health Care/Jasper Neurological Care clinic. According to his guilty plea, Ali dispensed 1,100 oxycodone pills to three undercover officers between August 2014 and November 2014 without conducting acceptable medical examinations or requesting and/or reviewing medical records. Ali’s medical files for the three individuals listed multiple falsified examinations and multiple falsified and baseless diagnoses.
“Abuse of prescription opiates, which contributes to heroin addiction, is a nationwide problem that has resulted in epidemic overdose death rates,” Vance said. “Alabama leads the nation in the number of per capita prescriptions for opioid painkillers, a troublesome distinction. While responsible and legitimate painkiller prescribing is an important part of the practice of medicine, doctors who use their prescription pads to provide opiates without legitimate medical reason are illegally dealing drugs,” she said. “My office and our law enforcement partners are committed to shutting that down.”
“The use, abuse, distribution and diversion of opiate pharmaceutical drugs are at epidemic levels in Alabama and across the United States,” Morris said. “The doctors who abandon their Hippocratic Oath and distribute highly addictive pain medicine without a legitimate medical purpose hurt our communities and ruin the great reputation of the many doctors who work tirelessly to help others,” he said. “Today’s sentence should send a clear message to those who illegally distribute drugs. DEA and our law enforcement partners will work relentlessly to protect our communities, citizens and neighborhoods against illegal drug distribution that leads to drug addiction and ruined lives.”
“The illegal distribution and abuse of opiate drugs continues to be a great concern in Alabama,” Stabler said. “This growing problem impacts the lives of many families -- regardless of their demographics. State Bureau of Investigation narcotics agents worked closely with our federal partners during the course of this investigation,” he said. “We will continue to work as a team and collaborate with federal, state, county and municipal law enforcement agencies to fight the unlawful distribution of illegal drugs.”
Ali was one of three Birmingham-area physicians charged last year as part of DEA's Operation Pilluted in Alabama, Arkansas, Louisiana and Mississippi, which focused on reducing trafficking and abuse of pharmaceuticals.
The DEA, Internal Revenue Service, Criminal Investigation, and the Alabama Law Enforcement Agency investigated the case, which Assistant U.S. Attorneys Chinelo Diké-Minor and Robin Beardsley Mark prosecuted.
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Indonesian Domestic Worker Rescued from Forced LaborRead the Press Release
Assistant U. S. Attorney Christopher P. Tenorio (619) 546-8413
NEWS RELEASE SUMMARY – April 8, 2016
SAN DIEGO –Firas Majeed and Shatha Abbas were arrested today and charged with forcing an Indonesian woman to work in their El Cajon home for up to 18 hours a day without pay. The victim was rescued from the home after providing a note to a visiting nurse, asking for help.
Majeed and Abbas were arraigned today on a criminal complaint before U.S. Magistrate Judge Karen S. Crawford. They were charged with Forced Labor, Trafficking with Respect to Forced Labor, and Document Servitude. The charges include allegations that Majeed and Abbas benefitted through a scheme intended to cause the victim to believe that she would suffer physical restraint if she did not perform labor and services. Majeed and Abbas are also alleged to have concealed the victim’s passport in order to prevent and restrict her liberty to move and travel, and to maintain her labor and services.
The victim reported that she was previously held at a home belonging to relatives of Abbas in Dubai, United Arab Emirates. In Dubai, the victim was allegedly required to provide domestic services for 20 hours a day, every day, for five years. The victim was not paid a salary, and was directed to travel to the United States and work at the home of Majeed and Abbas.
The complaint further alleges that the victim traveled to El Cajon with Majeed in November 2015, and thereafter was required to provide domestic services, including cleaning and laundry, for the entire household, for 16-18 hours every day of the week. The victim reported that she received no days off and was not paid for her services. The victim also reported that she speaks no English, had no money, and was not allowed to leave, except to throw away the family’s trash.
The victim was removed from the residence of Majeed and Abbas on March 22, 2016, by agents from Immigration and Customs Enforcement’s Homeland Security Investigations. Healthcare workers reported to the national Human Trafficking Resource Center that the victim was seen in the back of the residence and closely monitored. Agents translated the note requesting help that the victim had provided to a visiting nurse, which prompted her rescue.
Victims of labor trafficking are often overwhelmed by fear, and they fail to report crimes against them. Frequently victims are unfamiliar with U.S. culture. They may be unaware of their rights or may have been intentionally misinformed about rights in this country. Many don’t speak English, and are unable to communicate with service providers, police, or others who might be able to help them.
They many times don’t self-identify as victims and often blame themselves for predicaments. Many are not legally in the U.S. and they have a fear of being arrested or deported. And, even though an unfortunate number of victims have been beaten and/or raped, they feel their current situation may still be better than where they came from. They may be afraid that speaking out may result in harm to families in their home countries, who are often threatened by traffickers. For all those reasons, these cases are tremendously difficult to investigate and prosecute.
U.S. Attorney Laura Duffy praised the victim for having the courage to seek help, and the healthcare workers who responded to her note.
“Human trafficking is a deplorable practice that amounts to modern slavery, and many of these victims are hiding in plain sight,” Duffy said. “Bringing human traffickers to justice and assisting trafficking survivors is one my top priorities. We all need to work together to recognize the signs and put a stop to this devastating crime.”
“Today’s arrests bring to light the sad reality of modern day slavery,” said Dave Shaw, special agent in charge for HSI San Diego. “HSI will not tolerate any form of human exploitation. Forced labor, which often involves individuals who are held in isolation, degraded, and most alarming – stripped of their basic human freedom, has no place in a modern society.”
Majeed and Abbas are scheduled for a preliminary examination before U.S. Magistrate Judge Jan M. Adler on April 21, 2016.
DEFENDANTS Case Number: 16MJ1016
Firas Majeed (aka Firas Ghazi Majeed Al Tameemi) Age: 44
Shatha Abbas (aka Shatha Yehia Abbas Hussain) Age: 38
SUMMARY OF CHARGES
Title 18, United States Code, Section 1589 (Forced Labor)
Maximum penalty: 20 years of custody; $250,000 Fine
Title 18, United States Code, Section 1590 (Trafficking with Respect to Forced Labor)
Maximum penalty: 20 years of custody; $250,000 Fine
Title 18, United States Code, Section 1592 (Document Servitude)
Maximum penalty: 5 years of custody; $250,000 Fine
AGENCY
Homeland Security Investigations
*The charges and allegations contained in an indictment or complaint are merely accusations, and defendants are considered innocent unless and until proven guilty.
Hudson County, New Jersey, Man Convicted of Production and Distribution of Child PornographyRead the Press Release
TRENTON, N.J. – A Hudson County, New Jersey, man was convicted today for posing as a teenage boy, and at times a teenage girl, to solicit underage females online to produce images of themselves engaged in sexually explicit conduct, possessing, and distributing those images to others, U.S. Attorney Paul J. Fishman announced.
Erik Vanderbeck, 49, of Bayonne, New Jersey, was convicted of two counts of production of child pornography, one count of distribution of child pornography and one count of possession of child pornography. The jury deliberated approximately one hour following a one-week trial before U.S. District Judge Freda L. Wolfson in Trenton federal court.
According to documents filed in this case and the evidence at trial:
Vanderbeck allegedly met various minor females in Internet chat rooms while pretending to be a teenage boy, and at times, a teenage girl. Over the course of their correspondence, Vanderbeck would ask them to send him nude images of themselves. Once Vanderbeck received nude images, he would threaten to post the victim’s nude images online unless she sent more. In some cases, Vanderbeck would send nude images that he had received from certain of his victims to other minors to induce them to self-produce child pornography. When one of the victims threatened to report Vanderbeck to the authorities, he replied, “The cops will never catch me.”
Law enforcement officers executed a search warrant at Vanderbeck’s home in Bayonne on July 22, 2014. They recovered computer equipment belonging to Vanderbeck containing images appearing to be of child pornography. Several of his victims said they produced images of child sexual abuse out of fear and in response to his threats.
Each count of production of child pornography carries a maximum potential penalty of 30 years in prison; the distribution count carries a maximum potential penalty of 20 years in prison; and the possession count carries a maximum potential penalty of 10 years in prison. All of the counts also are punishable by a $250,000 fine. Sentencing is scheduled for July 14, 2016..
U.S. Attorney Fishman credited postal inspectors with the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge James Ball in Newark, and the Bayonne Police Department, under the direction of Chief Drew Niekrasz, with the investigation leading to the today’s guilty verdict. He also thanked the Missouri Internet Crimes Against Children Task Force for its role in the investigation.
The government is represented by Assistant U.S. Attorneys Danielle Alfonzo Walsman and Danielle Corcione of the U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel: Joshua Markowitz Esq., Lawrenceville
Hamer Man Sentenced for Assaulting and Robbing Postal CarrierRead the Press Release
Contact Person: Eric Klumb (843) 727-4381
Columbia, South Carolina---- United States Attorney Bill Nettles announced that Hamer resident Cristopher Rakel German, age 25, was sentenced to a two-and-a-half years in prison for assaulting a mail carrier with intent to rob in violation of 18 U.S.C. §2114(a). The sentence was imposed on April 5th by United States District Court Judge R. Bryan Harwell sitting in Florence. On August 16, 2013, German had stopped a mail carrier after the carrier had attempted to deliver a package addressed to a fictitious name at the home of German’s relative. After the carrier refused to give the package to German, he shoved her and grabbed it. The package contained an unknown quantity of marijuana.
The case was investigated by Inspectors of the U.S. Postal Inspection Service. Assistant United States Attorney Eric Klumb prosecuted the case.
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Gambino Crime Family Associate Gennaro Bruno Pleads Guilty to 2002 Murder of Martin BosshartRead the Press Release
Earlier today, Gennaro “Jerry” Bruno, an associate of the Gambino organized crime family of La Cosa Nostra (the “Gambino crime family”) pleaded guilty at the federal courthouse in Brooklyn, NY, to racketeering and admitted to murdering Martin Bosshart on January 2, 2002 and conspiring to prevent testimony in a grand jury investigation into the Bosshart murder. Today’s plea took place before United States District Judge William F. Kuntz, II, who accepted Bruno’s plea. Pursuant to Bruno’s plea agreement with the government, Bruno will be sentenced to 21 years in prison. Sentencing is scheduled for May 6, 2016.
The plea was announced by Robert L. Capers, United States Attorney for the Eastern District of New York, and Diego Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI). For their outstanding investigative work and assistance in this case, Mr. Capers extended his grateful appreciation to the FBI, the New York City Police Department, the Queens County District Attorney, and the U.S. Attorney’s Office for the Southern District of New York.
According to court filings and facts presented during the plea proceeding, Bruno became an associate in the Corozzo Faction of the Gambino crime family by approximately 2000, after proving himself over a number of years as a member of a violent gang called the “Young Guns.” Over the next 14 years, Bruno engaged in numerous crimes with and on behalf of a faction of the Gambino crime family aligned with Joseph “JoJo” Corozzo, a powerful Gambino member who had risen to become the consigliere of the family. Bruno and other Gambino crime family members and associates moved large quantities of high-potency marijuana from Canada into the New York City area. In 2001, Bruno’s criminal associate Martin Bosshart began making efforts to exclude one of Bruno’s coconspirators from the marijuana importation operation. In an effort to prevent Bosshart from doing so, Bruno plotted with other Gambino crime family members and associates to murder Bosshart. On the night of January 2, 2002, Bruno lured Bosshart to an isolated location in Queens, NY. There, Bruno shot Bosshart in the back of the head at point-blank range, killing him immediately. The body of Martin Bosshart, who was 30 years old at the time, was recovered at the scene.
Thereafter, Bruno evaded justice for years and conspired with other Gambino associates to obstruct an official grand jury investigation into the Bosshart murder, all the while continuing to participate in the core money-making activities of the Gambino crime family, including drug trafficking and extortion. As part of the alleged pattern of racketeering, Bruno, among other things, used his position in the Gambino crime family to extract extortionate payments from the owner of a waste carting company in Queens, NY. Bruno was arrested in Las Vegas on October 28, 2014, and removed to the Eastern District of New York to face the charges against him.
The government’s case is being prosecuted by Assistant United States Attorneys M. Kristin Mace, Nadia Shihata, and Mathew Miller.
The Defendant:
GENNARO BRUNO, a/k/a “Jerry”
Age: 43
Las Vegas, NevadaE.D.N.Y. Docket No. 14-CR-556 (WFK)
Fulton Man, Boonville Woman Charged with Illegal Firearm Following Police Chase, Shoot-out with OfficersRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a Fulton, Mo., man and a Boonville, Mo., woman have been charged in federal court with illegally possessing a firearm following a police chase in the Columbia, Mo., area yesterday in which they fired upon pursuing officers.
Russell Deane Moore, Jr., 25, of Fulton, and Victoria Ann Buol, 24, of Boonville, were charged in separate but related criminal complaints filed in the U.S. District Court in Jefferson City, Mo., on Thursday, April 7, 2016. Moore and Buol, who were arrested at the conclusion of the law enforcement pursuit yesterday, will appear in court for a detention hearing this afternoon.
The federal criminal complaints charge Moore with being a felon in possession of a firearm and Buol with possessing a stolen firearm. They allegedly were in possession of a stolen Smith & Wesson 9mm semi-automatic pistol on Thursday, April 7, 2016.
According to affidavits filed in support of the criminal complaints, a Columbia, Mo., resident reported on Wednesday, April 6, 2016, that her Jeep had been stolen from her residence. Firearms and other items were also stolen from the residence, including the Smith & Wesson pistol. At approximately 2:44 a.m. on Thursday, April 7, 2016, a Boone County deputy sheriff saw the stolen Jeep pull into the Midway Travel Center, 6401 E. Hwy. 40, Columbia. The Jeep appeared to be unoccupied, the affidavit says, but as the deputy approached, he saw Buol move from the front passenger seat into the driver’s seat. She drove away from the deputy, the affidavit says, stopping in the parking lot to pick up Moore, who got into the front passenger’s seat.
The deputy pursued the Jeep with his emergency lights activated. The Jeep turned onto Highway 40 and, as it was crossing Interstate 70, Moore allegedly shot at the deputy multiple times. The Jeep turned onto Highway UU and stopped at the intersection of Sugar Creek Road. Moore got out of the Jeep and started shooting at the deputy, the affidavit says, then got back into the Jeep and the pursuit continued.
The deputy’s patrol vehicle was struck by gunfire and disabled. Other officers continued their pursuit of the stolen Jeep into the southern part of Columbia. The chase eventually moved onto Interstate 70 East, where officers continued to pursue the stolen Jeep into Callaway County, Mo. Throughout the pursuit, the affidavit says, multiple shots were fired from the Jeep at various officers. Shots were also fired from the Jeep at four semi-trailer trucks traveling on Interstate 70, nearly striking one of the drivers.
According to the affidavit, Moore and Buol later told investigators that they fired at the semi-trailer trucks in an effort to cause a serious accident, which would terminate officers’ pursuit of them and aid in their escape.
The pursuit ended when the Jeep ran out of gas on County Road 172 in Callaway County. Buol threw out the pistol from the front passenger seat, the affidavit says, and Moore and Buol were arrested.
Under federal law, it is illegal for anyone who has been convicted of a felony to be in possession of any firearm or ammunition. Moore has two prior felony convictions for burglary.
Dickinson cautioned that the charges contained in these complaints are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Larry Miller. It was investigated by the Boone County, Mo., Sheriff’s Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Former Real Estate Associate Sentenced to Federal Prison for His Role Tampa Mortgage SchemeRead the Press Release
Tampa, Florida – U.S. District Judge Elizabeth A. Kovachevich has sentenced Joseph Pasquale (39, Worcester, MA) to four years and nine months in federal prison for conspiracy to commit bank fraud and bank fraud. A federal jury found him guilty in January 2016.
According to testimony and evidence presented at trial, Pasquale worked as a real estate sales associate for a brokerage based in Cape Coral. Between October 2007 and March 2008, he was involved in the negotiation and sale of four condominium units at the Arbors of Carrollwood, to clients in California and Massachusetts. Pasquale engaged in a conspiracy to conceal sales incentives from mortgage lenders, which these clients received from the seller, along with private loans that Pasquale made to the buyer-clients enabling them to bring cash to their respective real estate closings. As a consequence of his actions, Pasquale helped to cause a loss of approximately $937,000 to Wells Fargo Bank when the mortgages involved in the case went into foreclosure.
This case was investigated by the Federal Bureau of Investigation and the Federal Housing Finance Agency - Office of Inspector General. It was prosecuted by Special Assistant United States Attorney Chris Poor and Assistant United States Attorney Jay L. Hoffer.
Former Manhattan Restaurant Owner Arrested for Running A $12 Million Ponzi SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Diego Rodriguez, Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), and William J. Bratton, Commissioner of the New York City Police Department (“NYPD”), announced today that HAMLET PERALTA, the former owner of a restaurant in Manhattan, was charged in Manhattan federal court with committing wire fraud through a scheme in which he obtained more than $12 million from investors on false pretenses and used that money to repay other investors and for personal expenses. PERALTA was arrested by FBI agents in Macon, Georgia, yesterday and will be presented before U.S. Magistrate Judge Charles Weigle in Macon this afternoon.
Manhattan U.S. Attorney Preet Bharara said: “As alleged, Hamlet Peralta solicited investors for his fictitious wholesale liquor business by peddling wholesale lies. Peralta’s Ponzi scheme allegedly fleeced his victims out of more than $12 million, virtually all of which he spent on himself or to repay other investors. Thanks to the work of the FBI and NYPD in this investigation, Peralta will not be able to victimize any other investors.”
FBI Assistant Director-in-Charge Diego Rodriquez said: “Fraud cases remain a priority for the FBI as we continue to identify and investigate those who commit financial crimes against unwitting victims. Peralta, who allegedly engaged in a multimillion-dollar enrichment scheme, will ultimately be brought to justice for his actions. We are appreciative of the support and cooperation we continue to receive from our law enforcement partners in this and so many cases.”
NYPD Commissioner William J. Bratton said: “As alleged, Hamlet Peralta violated the trust that investors placed in his fictitious wholesale liquor business venture by spending millions of his victim’s investments on clothes, food, and to continue the scheme. Thanks to the NYPD investigators and our federal law enforcement partners, Peralta will be held accountable for his actions.”
According to the allegations in the Complaint unsealed today in Manhattan federal court[1]:
From at least in or about July 2013, up to and including at least in or about 2014, PERALTA solicited more than $12 million from various investors by falsely representing that the investors’ money would be used to engage in wholesale liquor distribution for a profit. PERALTA promised investors high rates of return in the form of regular interest payments on their investments, which he represented were based on the profits to be generated by what he claimed would be his successful wholesale liquor business.
In truth and in fact, however, PERALTA misappropriated the millions of dollars in investments he received, and used those funds to repay other investors or for his own purposes. Of the more than $12 million provided to him by investors based on the representation that their money would be used to purchase wholesale liquor for resale, PERALTA in fact purchased no more than $700,000 in wholesale liquor. He used nearly all of the remaining money – more than $11 million – to repay other investors, wire money to himself, take out large cash withdrawals, and pay for personal expenses other than liquor.
As one example, in or about 2013, PERALTA told a prospective investor (“Investor-1”) who was a frequent customer at PERALTA’s restaurant and who had become friendly with PERALTA that he (PERALTA) owned a separate business called West 125th Street Liquors and that he had been approved as an exclusive wine distributor to a major national restaurant supply company (the “Restaurant Supply Company”) that was beginning a wholesale wine business. PERALTA told the investor that he would receive four percent interest on his investments, based on profits from the wholesale liquor distribution business. In truth and in fact, however, PERALTA did not own West 125th Street Liquors, and he had not been approved to be a distributor for the Restaurant Supply Company.
Over the course of the next year, based on PERALTA’s representations, the investor provided PERALTA with more than $3.5 million. Of that amount, none, or at most only a minimal amount, was spent on wholesale liquor purchases. Rather, Investor-1’s money was used to pay back other investors; was used to pay for expenses such as restaurant bills and high-end clothing purchases; and was wired to PERALTA’s personal accounts and/or withdrawn in cash. In or about June 2014, PERALTA provided Investor-1 with a document that purported to be on the letterhead of the Restaurant Supply Company indicating that the Restaurant Supply Company would be electronically transferring PERALTA $1,826,350 within seven days. In truth and in fact, however, neither PERALTA nor West 125th Street Liquors has ever been a supplier to the Restaurant Supply Company.
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PERALTA, 36, of the Bronx, New York, has been charged with one count of wire fraud, which carries a maximum term of 20 years in prison. The maximum potential sentence is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Bharara praised the investigative work of the FBI and the NYPD Internal Affairs Bureau, and noted that the investigation is continuing.
This case is being handled by the Office’s Public Corruption Unit. Assistant United States Attorneys Martin Bell, Russell Capone, and Kan M. Nawaday are in charge of the prosecution.
The charges contained in the Complaint 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 Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.
Former Hattiesburg Resident Pleads Guilty to Failure to Register as a Sex OffenderRead the Press Release
Hattiesburg, Miss. – Thomas Lamon Williams, 23, formerly of Hattiesburg, pled guilty in federal court on Thursday, April 7, 2016, to one count of failure to register as a sex offender, U.S. Attorney Gregory K. Davis announced today.
Williams is a person required to register under the Sex Offender Registration and Notification Act, enacted as part of the Adam Walsh Child Protection and Safety Act of 2006. His original underlying sex offense conviction is statutory rape in Grenada County, Mississippi. Williams traveled in interstate commerce from Mississippi to Florida and knowingly failed to register and update his registration.
Williams will be sentenced on June 16, 2016, at 9:15 a.m., by U. S. District Judge Keith Starrett, and faces a maximum sentence of 10 years in prison and a $250,000 fine.
This case was investigated by the U.S. Marshals Service and prosecuted by Assistant U.S. Attorney Andrea Jones.
Federal Jury Convicts New York Man in Connection with Scranton Bank RobberyRead the Press Release
SCRANTON - The United States Attorney=s Office for the Middle District of Pennsylvania announced today that Jemel Laquan King, a/k/a “Melo,” age 37, a resident of New York, was convicted of conspiracy, aiding and abetting a bank robbery and brandishing a firearm during the robbery. The four-day trial was held before U.S. District Court Judge James M. Munley in Scranton.
According to United States Attorney Peter Smith, the jury returned with the verdict of guilty after approximately two hours of deliberation. King conspired with others to commit the November 26, 2014 armed robbery of the NBT Bank on Keyser Avenue in Scranton. During the robbery, two robbers used firearms, restrained tellers, and threatened their lives. The tellers were held at gun point, forced to open the vault and were handcuffed and left inside the vault. Approximately $100,000 was taken during the robbery.
Judge Munley has not scheduled a sentencing date for King; King will remained detained pending a sentencing hearing.
Those previously charged with conspiring with King to commit the robbery include Jule Futrell, age 46, Endicott, New York, and Dorian Whitehead, age 30, Binghamton, New York. Both pled guilty.
The investigation was conducted by the Federal Bureau of Investigation - Scranton and Binghamton offices. The case was prosecuted by Assistant United States Attorneys Michelle Olshefski and Todd Hinkley.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalties in this case include 25 years’ incarceration, plus an additional minimum of 7 years’ incarceration for the use of the firearm during the commission of a violent crime. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant
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Federal Jury Convicts Fort Myers Man of Heroin TraffickingRead the Press Release
Fort Myers, FL – United States Attorney A. Lee Bentley, III announces that a federal jury today found Norris Williams (45, Fort Myers) guilty of three counts of possession with intent to distribute heroin and one count of attempting to possess with intent to distribute one kilogram or more of heroin. He faces a minimum mandatory penalty of 10 years, up to life, in federal prison. The sentencing is scheduled for July 5, 2016.
According to evidence presented at trial, Williams, a nine-time convicted felon, sold heroin to an undercover officer on three occasions between November 2014 and February 2015. Williams had also attempted to purchase a one kilogram brick of heroin from an undercover officer in October 2015. He had negotiated a price of $75,000 for that kilogram brick; $50,000 cash up front and a promise to pay the balance at a later date. When he met the undercover officer in a parking lot to complete that transaction, he handed the officer a shoebox containing $49,900.
This case was investigated by the Drug Enforcement Administration’s Fort Myers Resident Office, with assistance from the Cape Coral Police Department and the Lee County Sheriff’s Office. It is being prosecuted by Assistant United States Attorneys Charles Schmitz and David G. Lazarus.
Federal Jury Convicts Auburndale Man of Methamphetamine Trafficking ConspiracyRead the Press Release
Tampa, Florida – United States Attorney A. Lee Bentley, III announces that a federal jury has found Thomas Kohler (58, Auburndale) guilty of conspiring to possess 500 grams or more of methamphetamine with the intent to distribute it. He faces a minimum mandatory penalty of 10 years, up to life, in federal prison. The sentencing hearing is scheduled for July 1, 2016.
According to evidence presented at trial, Kohler was part of a conspiracy involving the Isaias Villa drug trafficking organization to distribute high-purity methamphetamine in Polk County. Isaias Villa received kilogram quantities of methamphetamine from the Atlanta area and then supplied it to dealers in Polk County. From at least early 2015 through September 9, 2015, Kohler was involved with Isaias Villa in at least two of these trips to Georgia. He also conspired to collect approximately $82,000 in drug proceeds and, on September 8, 2015, delivered a kilogram of methamphetamine to a coconspirator.
To date, the investigation has resulted in the federal convictions of five individuals and the seizure of approximately two kilograms of methamphetamine, more than $100,000 in U.S. currency, and homemade explosives.
This case was investigated by the Drug Enforcement Administration and the Polk County Sheriff’s Office. It is being prosecuted by Assistant United States Attorney Dan Baeza.
Federal Grand Jury Criminal Indictments AnnouncedRead the Press Release
TULSA, Okla.— The results of the April 2016 Federal Grand Jury were announced today by Danny C. Williams Sr., United States Attorney for the Northern District of Oklahoma.
The following individuals have been charged with violations of United States law in indictments returned by the Grand Jury. The return of an indictment is a method of informing a defendant of alleged federal crimes which must be proven in a court of law beyond a reasonable doubt to overcome a defendant’s presumption of innocence.
Angela Harden. Theft from Indian Country in Excess of $1,000. Harden, a non-Indian, 45, of Claremore, is charged with stealing over $1,000 of personal property belonging to an Indian. If convicted, she faces a statutory maximum penalty of five years in prison and a $250,000 fine. The Cherokee Nation Marshal Service and the Federal Bureau of Investigation are investigating the case.
Jason Scott Leach. Embezzlement from a Labor Organization. Leach, 32, of Locust Grove, Oklahoma, the former President of the United Steelworkers of America Local 13-669, is charged with nine counts of embezzlement. From April 2013 to September 2014, he allegedly stole over $2,500 from the labor organization. If convicted, he faces a statutory maximum penalty of five years in prison and a $10,000 fine. The United States Department of Labor, Office of Labor-Management Standards is the investigating agency.
Jeremy Paul Leach. Embezzlement from a Labor Organization. Leach, 35, of Locust Grove, Oklahoma, the former Secretary-Treasurer and Recording Secretary of the United Steelworkers of America Local 13-669, is charged with 12 counts of embezzlement. From July 2013 to October 2014, he allegedly stole over $3,000 from the labor organization. If convicted, he faces a statutory maximum penalty of five years in prison and a $10,000 fine. The United States Department of Labor, Office of Labor-Management Standards is the investigating agency.
Chrisostomo Isias Navarro-Chicaj. Reentry of Removed Alien. Navarro-Chicaj, 32, is charged with having returned to the United States unlawfully after being deported in October 2013 from Houston, Texas. If convicted, the statutory maximum penalty is 20 years in prison and a $250,000 fine. United States Immigration and Customs Enforcement is the investigating agency.
Enrique Reyes-Deluna. Reentry of Removed Alien. Reyes-Deluna, 48, is charged with having returned to the United States unlawfully after being deported in February 2011 from Brownsville, Texas. If convicted, the statutory maximum penalty is 20 years in prison and a $250,000 fine. United States Immigration and Customs Enforcement is the investigating agency.
Debbie J. Stockton. Interstate Transportation of Stolen Moneys. Stockton, 60, of Sapulpa, is charged with transporting, transmitting, and transferring in interstate commerce approximately $69,607.45 which was stolen. If convicted, she will face the statutory maximum penalty of 10 years in prison and a $250,000 fine. The Federal Bureau of Investigation and the Oklahoma Insurance Department are the investigating agencies.
James Wilson. Sexual Exploitation of a Child, Possession of Child Pornography, and Transfer of Obscene Material to Minor. Wilson, 31, of Tulsa, is charged with sexual exploitation of a minor from October 2014 to March 2016; possession of child pornography; and transferring obscene materials to a 12 year old girl. If convicted, the statutory minimum penalty is 15 years in prison and the statutory maximum penalty is not more than 30 years in prison and a $250,000 fine for the sexual exploitation of a child charge; and not more than 10 years in prison and a $250,000 fine for the other two charges. United States Immigration Customs Enforcement’s Homeland Security Investigations is the investigating agency.
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Ellis County Woman Sentenced to 105 Months in Federal Prison for Defrauding MedicaidRead the Press Release
DALLAS – An Ellis County woman who pleaded guilty last year to one count of health care fraud arising from her submission of false and fraudulent claims for counseling and psychotherapy services to Medicaid, on behalf of Medicaid beneficiaries, was sentenced this afternoon, announced U.S. Attorney John Parker of the Northern District of Texas.
Alexis C. Norman, 44, of Midlothian, Texas, was sentenced by U.S. District Judge Jane J. Boyle to 105 months in federal prison and ordered to pay $2,969,045.97 in restitution to Medicaid. Judge Boyle remanded the defendant into custody at the conclusion of the hearing.
According to documents filed in the case, Norman was the CEO and Executive Director of Greater Southwest Group, Inc. (GSWG) and Ellis County Community Services (ECCS). She obtained Medicaid group numbers for GSWG and ECCS and used those numbers, together with individual Medicaid provider numbers of licensed counselors and Medicaid recipient information, to submit fraudulent claims to Medicaid.
Norman, who is neither a psychotherapist nor a mental health provider, submitted claims for individual and family psychotherapy sessions that were not performed. As part of her fraud scheme, Norman used the Medicaid provider information of licensed counselors who applied for positions as contract counselors at GSWG and ECCS, but who were never hired and never worked for Norman, GSWG, or ECCS. Norman also used the Medicaid provider numbers of licensed counselors, without their knowledge and consent, to submit claims under the GSWG and ECCS group numbers for services that they did not perform and for psychotherapy services that predated and postdated their actual employment with Norman. The indictment alleges that Norman used the identification of more than 500 Medicaid recipients, most of whom were minor children, in her scheme.
From December 2, 2009, through July 17, 2014, Norman submitted claims to Medicaid and to Medicaid Managed Care Organizations, through GSWG and ECCS, totaling approximately $5,502,724.88; Norman was paid approximately $2,596,045.97 for these claims. The defendant was also ordered to pay $373,000.00 in restitution for her participation in a fraud scheme involving the summer food service program funded by the United States Department of Agriculture.
The investigation of Norman led to the investigation of her friend, Brenda Ward, 48, of Cedar Hill, Texas, who was running a similar fraud scheme. Ward was President and CEO of H.E.L.P.-ing. Communities, Inc. (HCI). She was neither a psychotherapist nor a mental health provider, but she submitted fraudulent claims to Medicaid for individual, family and group psychotherapy sessions that were not performed. Ward was indicted in February 2015 and subsequently pleaded guilty to one count of healthcare fraud, admitting that from January 2009 through February 9, 2015, she submitted fraudulent claims to Medicaid and to Medicaid Managed Care Organizations, through HCI, totaling approximately $1,639,923, and was paid approximately $887,809 on those claims. She was sentenced earlier this year by U.S. District Judge Sidney A. Fitzwater to 57 months in federal prison and ordered to pay $887,809 in restitution to Medicaid.
The FBI, the U.S. Department of Health and Human Services – Office of Inspector General, the Texas Attorney General’s Medicaid Fraud Control Unit, and the United States Department of Agriculture – Office of Inspector General investigated both the Norman and Ward cases, and Assistant U.S. Attorney Douglas Brasher prosecuted both cases.
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District Man Sentenced to 16 Years in Prison for Sexually Assaulting Woman in 2002 AttackRead the Press Release
WASHINGTON – Jeremiah Juwley, 30, formerly of Washington, D.C., was sentenced today to a 16-year prison term for sexually assaulting a woman in 2002, U.S. Attorney Channing D. Phillips announced.
Juwley pled guilty in February 2016, in the Superior Court of the District of Columbia, to attempted first-degree sexual abuse. The plea, which was subject to the Court’s approval, called for a sentence of 16 years in prison. The Honorable José M. López accepted the plea today and sentenced the defendant accordingly. Upon his release from prison, Juwley will be required to register as a sex offender for the rest of his life. He also will be on lifetime supervised release.
According to the government’s evidence, in the early morning hours of Sept. 14, 2002, the victim, then 22, was walking alone to a friend's home in the 1100 block of Columbia Road NW after leaving a nightclub. While in route, Juwley, a stranger to her, began walking behind her. To evade him, she walked to an outdoor stairwell that was somewhat secluded.
Juwley continued to pursue her. When he caught up to her, he grabbed her around the waist. The victim screamed. Juwley told her to shut up and knocked her face down onto the ground. She continued to scream, turning her face towards the apartment building so someone could hear her. The defendant continued to strike her in the face and started banging her head on the ground, eventually knocking her unconscious. Juwley then attempted to sexually assault her.
The victim reported the assault to the Metropolitan Police Department (MPD) and was taken to Howard University Hospital, where she was treated for injuries and swabbed for DNA. The case was cold until April 2014, when the defendant was identified as a suspect through the Combined DNA Index System (CODIS), a web of state and national databases containing DNA profiles from convicted offenders and crime scenes that is used as an investigative tool. Juwley’s DNA was in the system as a result of a 2011 conviction in a carjacking case; he was sentenced to a seven-year prison term in that case. Juwley’s DNA profile matched the DNA left behind by the assailant in 2002. Juwley was arrested in the sexual assault case in December 2015.
In announcing the sentence, U.S. Attorney Phillips commended the work of detectives from the MPD’s Sexual Assault Unit, the Third Police District, and officers from the Forensic Science Division. He also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Victim/Witness Advocate Lezlie Richardson; Paralegal Specialists Jason Manuel, Tiffany Jones, and Tierra Naches, and Michael Ambrosino, Special Counsel for DNA and Forensic Evidence Litigation. Finally, he expressed appreciation for the work of former Assistant U.S. Attorney Jeff Cook and Assistant U.S. Attorneys Kenya Davis and Nicholas Miranda, who investigated and prosecuted the case.
District Man Pleads Guilty to Second-Degree Murder in 2014 Slaying of His Estranged WifeRead the Press Release
WASHINGTON – Michael Gayle 35, of Washington, D.C., pled guilty today to a charge of second-degree murder stemming from the brutal strangling and stabbing of his estranged wife at her home in Southeast Washington, U.S. Attorney Channing D. Phillips announced.
Gayle pled guilty in the Superior Court of the District of Columbia. The Honorable Lynn Leibovitz scheduled sentencing for June 20, 2016. The charge carries a potential maximum penalty of life in prison.
According to the government’s evidence, in the early morning hours of June 29, 2014, Gayle went to the home of his wife, 31-year-old Eboni Domally, in the 5200 block of Queens Stroll Place SE. On that date, Gayle was no longer living at the home, having moved out over two months earlier. After arriving at the home, Gayle choked Ms. Domally, and then later stabbed her, causing extensive sharp force injuries to Ms. Domally. These injuries eventually led to Ms. Domally’s death. Ms. Domally’s young son observed the events and ran to get help.
Gayle left the home before help arrived. He was ultimately arrested on July 22, 2014, by the U.S. Marshals Service and the Capital Area Regional Fugitive Task Force at his mother’s home in Charlotte, N.C. He has been in custody ever since.
Gayle pled guilty in 2012 in the Circuit Court for Prince George’s County, Md., to assault and burglary charges stemming from another incident in September 2011 with his wife.
In announcing the plea, U.S. Attorney Phillips commended the work of those who investigated the case from the Metropolitan Police Department (MPD). He also expressed appreciation for the assistance provided by the U.S. Marshals Service, the Capital Area regional Fugitive Task Force, and the Charlotte-Mecklenburg Police Department. He acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Patricia A. Riley, Special Counsel to the U.S. Attorney; Victim/Witness Advocate Marcia Rinker; Paralegal Specialists Benjamin Kagan-Guthrie and Kendra Johnson; former Lead Paralegal Specialist Kwasi Fields. and Librarian Lisa Kosow. Finally, he commended the work of Assistant U.S. Attorneys Magdalena Acevedo and Amy H. Zubrensky, who investigated and prosecuted the case.
Defendants Sentenced to Imprisonment in Extensive Stolen Identity Tax Refund Fraud SchemeRead the Press Release
Six defendants have been sentenced to terms of imprisonment for their participation in an extensive stolen identity tax refund fraud scheme involving the personal identifying information (PII) of more than 29,000 individuals. The defendants used the PII, including names, dates of birth, and Social Security numbers, to file thousands of fraudulent federal income tax returns with the IRS claiming, collectively, tens of millions of dollars in refunds.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), Robert C. Hutchinson, Acting Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), Delany De-Leon Colon, Acting Inspector in Charge, U.S. Postal Inspection Service (USPIS), Miami Division, Rafiq Ahmad, Special Agent in Charge, United States Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations Miami Office (DOL-OIG), Carlos A. Canino, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Miami Field Office, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Dexter Williams, Chief, City of Miramar Police Department, Steve Steinberg, Chief, Aventura Police Department, William Hernandez, Chief, North Miami Beach Police Department (NMBPD), and Franklin Adderley, Chief, Fort Lauderdale Police Department, made the announcement.
Harlan Decoste, a/k/a “Money King,” a/k/a “Moneyking_111,” 27, of Miramar, was sentenced to a total of 234 months in prison, to be followed by 3 years of supervised release, and was ordered to pay joint and several restitution in the amount of $28,211,434. Kerby Luma, a/k/a "Money Makin Kerb," 26, of Miramar, was sentenced to a total of 132 months in prison, to be followed by 3 years of supervised release, and was ordered to pay joint and several restitution in the amount of $28,211,434. Frantz Decoste, a/k/a "Gripe_111," 21, of Miramar, was sentenced to a total of 54 months in prison, to be followed by 3 years of supervised release, and was ordered to pay joint and several restitution in the amount of $28,211,434. Francis Jeudy, a/k/a "Money Makin Rab," a/k/a "Brizzleon111," 26, of Miramar, was sentenced to a total of 116 months in prison, to be followed by 3 years of supervised release, and was ordered to pay joint and several restitution in the amount of $28,211,434. Andy Cherrelus, a/k/a "Risktakers111," 24, of Miami, was sentenced to 94 months in prison, to be followed by 3 years of supervised release, and was ordered to pay joint and several restitution in the amount of $10,000,000. Each of the defendants previously pled guilty to one count of conspiracy to defraud the government with respect to claims, in violation of Title 18, United States Code, Section 286, one count of conspiracy to possess fifteen or more unauthorized access devices, in violation of Title 18, United States Code, Section 1029(b)(2), one count of possession of fifteen or more unauthorized access devices, in violation of Title 18, United States Code, Section 1029(a)(3), and one count of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A(1)(a). Frantz Decoste and Jeudy also pled guilty to one count of possession of stolen mail, in violation of Title 18, United States Code, Section 1708.
In a separate sentencing hearing, Chad Davis, a/k/a "Chadillac," a/k/a "Chadillac 305," 29, of Miami, was sentenced to 4 months in prison, to be followed by three years of supervised release. Davis previously pled guilty to one count of possession of fifteen or more unauthorized access devices, in violation of Title 18, United States Code, Section 1029(a)(3).
“During the course of this stolen identity tax refund scheme, the defendants targeted our U.S. taxpayers and the IRS by unlawfully possessing and using personal information to submit tens of millions of dollars in fraudulent tax refund claims,” said U.S. Attorney Wifredo Ferrer. “The prosecution of those who attempt to steal our tax dollars will continue to remain a top priority for the U.S. Attorney’s Office and our law enforcement partners.”
Kelly R. Jackson, Special Agent in Charge, IRS Criminal Investigation (IRS-CI), stated, “This is one of the largest stolen identity tax refund fraud schemes prosecuted in the United States. These defendants perpetuated an elaborate scheme driven by insatiable greed and a blatant disregard for the integrity of the United States tax system. This case is another example of IRS-CI’s commitment to investigate individuals who participate in stolen identity tax refund fraud and hold them accountable for their actions.”
“We continue to utilize our vast resources to disrupt and dismantle these criminal organizations,” stated Robert C. Hutchinson, Special Agent in Charge, ICE's Homeland Security Investigations.
"We work together with the common goal of making our communities safer," said Delany De Leon Colon, Acting Inspector In Charge, U.S. Postal Inspection Service, Miami Division. "We will continue to work collaboratively to take criminals off our streets."
“The Department of Labor Office of Inspector General is committed to working with our Identity Theft Strike Force partners to combat fraud involving the unemployment insurance program in the Southern District of Florida and other affected areas. This collaborative effort has been an invaluable tool in bringing the perpetrators of these crimes to justice,” stated Rafiq Ahmad, Special Agent in Charge of the Atlanta Regional Office of the U.S. Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations.
“A great example of local and federal agencies working together to remove from our streets those who seek fraudulent financial gain by stealing identity information from honest citizens,” said Carlos A. Canino, Special Agent in Charge, ATF.
“This massive stolen identity scheme impacted thousands of victims and fraudulently claimed tens of millions of dollars in IRS refunds,” said George L. Piro, Special Agent in Charge, FBI Miami. “The investigation highlights the necessary and extensive cooperation by numerous law enforcement agencies that brought these fraudsters to justice. I commend these agencies for their commitment to investigate cyber intrusions that rob citizens of their identities.”
According to court documents, while officers from the Miramar Police Department were investigating an armed home invasion that occurred at a home occupied by Harlan Decoste, Frantz Decoste, Luma, and Jeudy, in the Silver Falls Subdivision in Miramar, they discovered evidence of narcotics activity within the home. As a result, officers obtained a state court search warrant for the residence.
While officers were searching the home pursuant to the state court warrant, they found evidence of fraud related activity in various bedrooms and common areas, consisting of approximately 500 debit cards issued in other persons’ names, one ledger/notebook that contained PII, one ledger/notebook that contained information related to tax returns, five United States income tax refund checks in other persons’ names, and various tax return documentation in other persons’ names. In addition, the officers seized approximately 10 computers and 3 USB drives. There were also significant amounts of United States currency, jewelry, expensive shoes and clothing, and other valuable items in the home.
Federal Agents obtained a search warrant to review the electronic and other evidence recovered from the residence. A forensic review of those items revealed that the computers contained over 29,000 individual pieces of PII. Some of the PII appeared in photographs of computer screens (screenshots) from a medical center. The screenshots each contained approximately twelve patient names, dates of birth, and Social Security numbers. The PII was also contained in rich text format document files. Many of the rich text document files contained the PII from the patient screenshots, along with additional user-inputted information such as the victims’ true addresses, fictitious addresses associated with tax returns, account numbers, IRS filing personal identification numbers, and refund amounts.
Further analysis revealed that the defendants filed and caused to be filed numerous fraudulent federal tax returns claiming, collectively, tens of millions of dollars associated with the PII recovered from the residence. The defendants provided payment instructions on the tax returns, directing the IRS to transfer the tax refunds to various accounts in other persons' names that the defendants and their co-conspirators controlled. The defendants then withdrew the unlawfully obtained tax proceeds for their personal use and to further the fraud scheme.
Mr. Ferrer commended the investigative efforts of IRS-CI, ICE-HSI, USPIS, DOL-OIG, ATF, FBI Miami Cyber Task Force, as well as the Miramar, Aventura, North Miami Beach and Fort Lauderdale Police Departments. The case was prosecuted by Assistant United States Attorney Brooke Watson.
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.
Dallas Woman Pleads Guilty to Role in Armed Car-JackingRead the Press Release
TYLER, Texas – A 27 year old Dallas, Texas woman has pleaded guilty in federal court to Car-Jacking and Bank Robbery charges, announced U.S. Attorney John M. Bales today.
According to information presented in court, on March 13, 2015, Chanel Collins, 27, a Dallas resident, drove Laquaylan Patterson (Patterson) from Jarvis Christian College, just east of Hawkins, Texas, to an apartment complex in Tyler, Texas, with the intent to aid Patterson in committing an armed carjacking.
Upon arriving at the apartment complex, Patterson got out of Collins’ car, armed with a semiautomatic pistol, and told Collins to wait for his signal to her cell phone. Patterson then approached a woman who was visiting her mother at the complex, brandished his pistol, and demanded the woman’s car keys. The woman surrendered her keys and Patterson took her vehicle and drove away. Patterson then signaled Collins and she also departed the complex in her car. Collins and Patterson then drove their respective vehicles back to Jarvis Christian College.
Later that same day, Collins drove her vehicle to a car wash in Big Sandy, Texas, to aid Patterson in committing an armed robbery of the 1st National Bank of Gilmer, located in Big Sandy. As Collins was waiting for Patterson at the car wash, Patterson drove the vehicle he had carjacked to the bank. Patterson entered the bank and brandished a pistol, climbed behind the teller counter, and demanded money from the tellers. The tellers stood aside as Patterson removed all the bills from two cash drawers and put the money in a bag. Patterson then fled the bank, driving in the carjacked vehicle to the car wash where Collins was waiting. Once Patterson arrived at the car wash, he and Collins fled in her vehicle.
Collins and Patterson were indicted by a Federal Grand Jury in Tyler, Texas on June 17, 2015. Collins is facing a maximum sentence of 25 years’ incarceration plus a fine of $250,000.00. A sentencing hearing for Collins will be held at a later date. Patterson’s case is still pending trial.
This case was investigated by the Federal Bureau of Investigation, Tyler Office, the Texas Rangers’ Office, the Big Sandy Police Department, and the Tyler Police Department, and is being prosecuted by Assistant U.S. Attorney Jim Noble.
Crime Victims, Survivors, Good Samaritans and Community Groups to Be Honored at Event Marking National Crime Victims' Rights WeekRead the Press Release
WASHINGTON - U.S. Attorney Channing D. Phillips and the Victim Witness Assistance Unit of the U.S. Attorney’s Office for the District of Columbia will pay tribute Monday, April 11, 2016, to over 30 crime victims, their families, witnesses, community groups, and Good Samaritans for their bravery, compassion, and dedication to the pursuit of justice.
The honorees are to be recognized during a ceremony at 2 p.m. hosted by the U.S. Attorney’s Office for the District of Columbia, timed with the annual observance of National Crime Victims’ Rights Week, at One Judiciary Square.
This year’s national theme, “Serving Victims, Building Trust, Restoring Hope,” highlights the importance of early intervention and victim services in establishing trust with victims, which in turn begins to restore their hope for healing and recovery.
“Day after day, all of us are inspired by the strength, perseverance and courage of the victims and witnesses who come forward in the name of justice and public safety,” said U.S. Attorney Phillips. “We are committed to doing everything we can to help them and their families throughout the criminal justice process. This ceremony is one way that we can show our respect and appreciation for the fortitude they demonstrate in the most challenging of circumstances.”
In addition to U.S. Attorney Phillips, those scheduled to speak at the ceremony include Sherry Zalika Sykes, whose 22-year-old son, Omar Sykes, was slain on July 4, 2013, in a botched attempted armed robbery in Northwest Washington. Her son was a rising senior at Howard University; his killer is serving a 28 ½-year prison term. Ms. Sykes is a career federal public servant with extensive experience in the non-profit community. She was granted a fellowship in 2014 and 2015 to engage in a year-long program of study, speaking, and teaching about violence, and has spoken to audiences nationwide about its impact.
Ms. Sykes will be honored at the ceremony, along with other individual victims, survivors and Good Samaritans whose efforts furthered the cause of justice. For example, the honorees include victims and witnesses who came forward after violent crimes; family members of murder victims, who attended weeks of trial; and a couple who intervened to stop a sexual assault, protected the victim until police arrived, and then pointed out the defendant to police.
The honorees also will include five officers from the Metropolitan Police Department’s Sixth District, who rescued residents from a burning apartment building in Southeast Washington earlier this year, and a U.S. Navy commander who came to the aid of a woman who had just been robbed at the L’Enfant Metro station. The Navy commander confronted the robber and was stabbed in an attempt to apprehend him for police.
Special recognition will be given to the Children’s Law Center, a non-profit based in the District of Columbia that is now celebrating its 20th anniversary of helping children and families. The Children’s Law Center is being honored for the assistance that it provided a child in obtaining stable housing as well as emotional support during a trial.
The event was developed and organized by the Victim Witness Assistance Unit of the U.S. Attorney’s Office for the District of Columbia. Members of the Unit provide essential services and support to victims and witnesses, such as making referrals for counseling and other services, addressing safety concerns, and accompanying victims to court proceedings. The Unit also notifies victims of their rights and provides information regarding significant case events, such as the filing of charges, plea hearings, trials and sentencing hearings.
Additional information about the Victim Witness Assistance Unit is available at https://www.justice.gov/usao-dc/victim-witness-assistance
Further information about National Crime Victims’ Rights Week is available at http://ovc.ncjrs.gov/ncvrw/.
NOTE: This event is open to the press. It will take place in the old Council Chambers of the One Judiciary Square Building, 441 Fourth Street NW. All media must present government-issued photo I.D. (such as a driver’s license) as well as valid media credentials. Media check-in begins at 1:30 p.m. EDT. Press inquiries regarding logistics should be directed to Bill Miller at 202-252-6643 or James Perez at 202-252-6608.
Corporation and Two Owners of Fairview Heights Restaurant Plead Guilty to Tax ChargesRead the Press Release
LOTAWATA CREEK, INC., d/b/a Lotawata Creek Southern Grill, a restaurant located in Fairview Heights, Illinois, and its two owners, Rodney Archer, 50, and Kenneth Archer, 52, pled guilty in federal district court today to a conspiracy to obstruct the Internal Revenue Service in the assessment and collection of federal income taxes, James L. Porter, Acting United States Attorney for the Southern District of Illinois, announced.
Rodney Archer and Kenneth Archer each face a total maximum sentence of five years in federal prison, a $250,000 fine and up to three years supervised release, plus mandatory restitution. The corporation faces a maximum sentence of a fine of $500,000, restitution and five years of probation. Sentencing is scheduled for July 15, 2016.
As part of their pleas of guilty, Rodney Archer, Kenneth Archer, and Lotawata Creek, Inc., d/b/a Lotawata Creek Southern Grill, admitted that from beginning in 2010, through in or about July, 2015, they altered and manipulated the information in the restaurant's point of sale system to lower the reported cash sales and then did remove the corresponding amount of cash from the business prior to being deposited and reported as gross receipts. This had the effect of lowering the total gross receipts reported on the tax returns and thereby lowered the total taxable income reported to the Internal Revenue Service. Lotawata Creek, Inc. was incorporated in Missouri and is registered as a foreign corporation in Illinois beginning on February 1, 1996. Lotawata Creek, Inc. operates a popular restaurant located on Salem Place, Fairview Heights, Illinois and is owned by the two brothers - Kenneth Archer is the President and Rodney Archer is the Vice President.
The successful prosecution is the result of an investigation conducted by the Internal Revenue Service/Criminal Investigations. The prosecution of the case is being handled by Assistant U.S. Attorney Norman R. Smith.
Convicted Felon Sentenced to Prison for Stealing FirearmsRead the Press Release
STATESVILLE, N.C. – A Taylorsville, N.C. man with multiple past felony convictions was sentenced yesterday to 92 months in prison for breaking into homes and stealing the owners’ firearms, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. In addition to the prison term, Andrew Ray Jonas, 34, was sentenced to three years of supervised release by U.S. District Judge Richard L. Voorhees, who presided over the sentencing hearing.
“Over the course of his criminal career Jonas had been warned many times to stay away from guns. Instead, Jonas went on a break-in spree, stealing numerous firearms from innocent homeowners which he then traded for money. As a result, he will spend the next seven years behind bars. Jonas should have paid closer attention to those who tried to warn him,” said U.S. Attorney Rose.
According to filed court documents and statements made in court, on May 19, 2014, law enforcement were notified that a residence in the Taylorsville area had been broken into. A A revolver, a pistol and jewelry were among the items stolen from the residence. According to court records, eye witnesses stated that prior to the break-in a gold SUV had been parked outside the residence, occupied by what appeared to be two females wearing bandanas. Later the same day, law enforcement located the vehicle which displayed a license plate that belonged to a different vehicle. Court records show that Jonas, who was a passenger, was wearing a bandana on his head. According to court records, Jonas was arrested after law enforcement found the two stolen firearms inside the car by Jonas’ feet.
Court records show that during the investigation law enforcement found evidence tying Jonas to multiple break-ins of homes in Taylorsville. According to court records, Jonas was also found in possession of tools stolen from the home break-ins, and in possession of pawn tickets for stolen lawn and power tools that he had pawned. Court records indicate that one person told law enforcement that he had purchased multiple firearms from Jonas and had paid $340 to $360 for each one. Jonas pleaded guilty in September 2015 to one count of theft of a firearm. Jonas’ previous convictions prohibit him from possessing a firearm and ammunition.
In handing down the sentence, Judge Voorhees stated that the sentence was to “protect the public from further crimes of the defendant.” Judge Voorhees expressed “grave concern for further criminality of particularly the breaking and entering sort.” Judge Voorhees observed, “hard working people work hard to get a house, and want it to be a castle, a place of sanctity, security,” and that defendant’s acts had violated that sense of security. Judge Voorhees also noted that Jonas has “’Villain’ tattooed on his right arm, it does not make him a villain, but speaks to his state of mind.”
Jonas is currently in federal custody and will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
In making today’s announcement U.S. Attorney Rose thanked C.J. Hyman, Special Agent in Charge of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Charlotte Field Division and Sheriff Chris Bowman of the Alexander County Sheriff’s Office for investigating the case.
Assistant U.S. Attorney Robert Gleason of the U.S. Attorney’s Office in Charlotte was in charge of the prosecutions.
Convicted Drug Trafficker and Money Launderer Sentenced to PrisonRead the Press Release
BOSTON – A Brockton man was sentenced today in U.S. District Court in Boston in connection with orchestrating a cross-country conspiracy to distribute cocaine and marijuana.
Miguel Fernandes, 40, was sentenced by U.S. District Court Judge F. Dennis Saylor, IV, to 12 years in prison, four years of supervised release, and forfeiture of $1 million and a 2007 Ferrari. In January 2016, Fernandes pleaded guilty to conspiracy to possess with intent to distribute 500 grams or more of cocaine, possession with intent to distribute 100 kilograms or more of marijuana, and conspiracy to launder monetary instruments.
A two-year federal investigation revealed a well-organized conspiracy responsible for the transportation and distribution of cocaine and marijuana from Los Angeles to Boston. Fernandes, who at the time of the offense lived in Los Angeles, Calif. under the alias “Orlando Sanchez,” obtained the drugs from sources in Los Angeles, and utilized various means, including the USPS express mail system, to ship the drugs to various cities in the greater Boston area. Fernandes and his co-conspirators also laundered the proceeds made from the sale of those drugs. The conspiracy utilized “funnel accounts” controlled by individuals in Los Angeles who allowed deposits for Fernandes to be made to their accounts in Massachusetts and withdrawn in Los Angeles. As many as 40 funnel accounts were utilized, through which Fernandes and his co-conspirators laundered as much as $5 million in drug sale proceeds.
As the organizer and leader of the operation, Fernandez oversaw all aspects of the conspiracy. He also reaped the greatest rewards. At the time of his arrest, Fernandes had acquired a mint condition 2007 Ferrari 430 which he was ordered to forfeit to the government.
Co-defendants Michael Alves, 28, Alex Gomes, 26, and Nelson Teixeira, 36, all of Brockton, each pleaded guilty to conspiracy to launder monetary instruments. In February 2016, Alves was sentenced to 27 months in prison, and Gomes was sentenced to 30 months in prison.
In March 2016, Teixeira was sentenced to one year and one day in prison for his role. Marcos Andrade was acquitted of conspiracy to launder monetary instruments in January 2016 after trial.
United States Attorney Carmen M. Ortiz; Shelly Binkowski, Inspector in Charge of the U.S. Postal Inspection Service; Joel P. Garland, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; Michael J. Ferguson, Special Agent in Charge of the Drug Enforcement Administration, New England Field Division; Lisa A. Quinn, Special Agent in Charge of the U.S. Secret Service; and Colonel Richard D. McKeon, Superintendent of the Massachusetts State Police, made the announcement today. The case was prosecuted by Assistant U.S. Attorneys Karen Beausey and James Arnold of Ortiz’s Narcotics and Money Laundering Unit.
Cecil County Man Sentenced to 18 Years in Prison for Distributing Child PornographyRead the Press Release
Baltimore, Maryland – U.S. District Judge George L. Russell III sentenced James J. Stanley, age 29, of Rising Sun, Maryland, today to 18 years in prison followed by a lifetime of supervised release for distributing child pornography. Stanley also admitted to the attempted sexual exploitation of a minor. Judge Russell ordered that upon his release from prison, Stanley must register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Andre R. Watson of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Colonel William M. Pallozzi, Superintendent of the Maryland State Police; Chief F.D. “Chip” Peterson, Jr. of the Rising Sun Police Department; and Cecil County State’s Attorney Ellis Rollins.
According to his plea agreement, Stanley used a website that hosts anonymous and random one-to-one video and text chat. The website allows users to chat with others without providing any identifying information, and markets itself as an opportunity for users to “Talk to strangers!” During a video chat session on the website on October 20, 2014, Stanley used his webcam to display an image documenting the sexual abuse of a prepubescent girl, which was stored on his computer or other digital storage media.
Stanley also admitted that he placed a recording device in a shower that he knew would be used by a minor female, with the intent to create video recordings of her engaged in sexually explicit conduct. Between November 14, 2014 and January 14, 2015, Stanley saved a video file to his computer that depicted the girl taking a shower. The girl’s genital area is not visible in the video. Stanley stated that he used his cell phone to record the girl showering on approximately 10 occasions, although other videos of her were not recovered.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc. For more information about internet safety education, please visit www.justice.gov/psc and click on the "resources" tab on the left of the page.
United States Attorney Rod J. Rosenstein commended the HSI Baltimore, the Maryland State Police, Rising Sun Police Department and the Cecil County State’s Attorney’s Office for their work in the investigation and prosecution. Mr. Rosenstein thanked Assistant U.S. Attorney Zachary A. Myers, who prosecuted the case.
Buffalo Man Charged with Threatening the President, A Former President and Multiple Presidential CandidatesRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051BUFFALO, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that Joseph Conrad Goode, 21, of Cheektowaga, NY, was arrested and charged by criminal complaint with threatening the President, threatening a former President, and threatening a major candidate for Office of the President of the United States. The charges carry...
Assistant U.S. Attorney Mary C. Baumgarten, who is handling the case, stated that according to the complaint, on April 7, 2016, the United States Secret Service Buffalo Field Office received information that the defendant threatened to injure and kill Barack Obama, William Clinton, Donald Trump, Hillary Clinton, and Ted Cruz.
Among others things, the defendant allegedly said:
• He was going to get a "high powered rifle and kill all the presidential candidates," and that he "is the kind of person ready to snap and shoot up a public place."
• “Bill Clinton is only a couple hours away and I am going to f------ kill him along with Donald Trump, Ted Cruz and all of the FBI." Goode also said he had a sniper rifle and was going to get it when he got out of here [ECMC].
• Wanted to kill Hillary Clinton and Donald Trump.
• The defendant’s goal in killing presidential candidates was to "see the world burn."
The defendant will make an initial appearance today at 11:30 a.m. before U.S. Magistrate Judge H. Kenneth Schroeder.The complaint is the result of an investigation by the United States Secret Service, under the direction of Special Agent in Charge C. Todd Laster.
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.
Arizona Man Arrested in New Mexico Based on DEA Seizure of More than Ten Pounds of HeroinRead the Press Release
ALBUQUERQUE – Jose Andres Ramirez, 24, of Phoenix, Ariz., made his initial appearance today in federal court in Albuquerque, N.M., on a criminal complaint charging him with possessing more than ten pounds of heroin with intent to distribute. Ramirez remains in federal custody pending a preliminary hearing and a detention hearing scheduled for April 11, 2016.
Ramirez was arrested yesterday after the DEA allegedly found 4.85 gross kilograms (10.69 pounds) of heroin concealed in his luggage at the Greyhound Bus Station in Albuquerque.
If convicted of the charge in the criminal complaint, Ramirez faces a statutory penalty of a mandatory minimum of ten years and a maximum of life in federal prison. Charges in criminal complaint are merely accusations, and defendants are presumed innocent unless found guilty beyond a reasonable doubt.
This case was investigated by the Albuquerque office of the DEA and is being prosecuted by Assistant U.S. Attorney Rumaldo Armijo.
The New Mexico Heroin and Opioid Prevention and Education (HOPE) Initiative was launched in January 2015 by the UNM Health Sciences Center and the U.S. Attorney’s Office in response to the national opioid epidemic which has had a disproportionately devastating impact on New Mexico. Opioid addiction has taken a toll on public safety, public health and the economic viability of our communities. Working in partnership with Bernalillo County, the Albuquerque City Council, DEA, Healing Addiction in our Community (HAC) and other community stakeholders, HOPE’s principal goals are to protect our communities from the dangers associated with heroin and opioid painkillers and reducing the number of opioid-related deaths in New Mexico.
The HOPE Initiative is comprised of five components: (1) prevention and education; (2) treatment; (3) law enforcement; (4) reentry; and (5) strategic planning. HOPE’s law enforcement component is led by the Organized Crime Section of the U.S. Attorney’s Office and the DEA in conjunction with their federal, state, local and tribal law enforcement partners. Targeting members of major heroin and opioid trafficking organizations for investigation and prosecution is a priority of the HOPE Initiative. Learn more about the New Mexico HOPE Initiative at http://www.HopeInitiativeNM.org.
Antitrust Division Issues 2016 Annual Spring UpdateRead the Press Release
The Department of Justice’s Antitrust Division today issued its 2016 spring update. The update highlights the Antitrust Division’s civil and criminal enforcement actions, international cooperation efforts, and competition guidance and advocacy over the last year.
The spring update includes a message from Assistant Attorney General Bill Baer discussing the division’s recent litigation successes, civil enforcement wins, and its prosecution of domestic and international cartels. The update includes profiles of some of division employees who helped make that happen.
The spring update describes the division’s successes in civil enforcement over the past year. These include several wins in just the last few weeks: the Supreme Court’s recent denial of Apple’s cert. petition, ending that company’s efforts to avoid liability for its role in orchestrating a conspiracy with book publishers to raise the price of eBooks; United Airlines’ abandoned efforts to bolster its monopoly at Newark International Airport; and the temporary restraining order that foiled Tribune Company’s efforts to monopolize local newspaper markets in southern California. The spring update also provides an in-depth look at the division’s suit to block the Electrolux-General Electric merger, which the parties abandoned before the end of trial, and its earlier work to protect competition among broadband internet providers, canned tuna companies, and installment lenders.
This year’s update also describes the division’s criminal enforcement efforts, which included obtaining more than $3.6 billion in criminal fines and penalties – the largest amount ever secured by the division in a single fiscal year – and bringing charges against 20 companies and more than 60 individuals for criminal violations of U.S. antitrust laws. The update looks at the milestones the division reached in its prosecution of collusion and fraud in the financial industry and among real estate investors in the southeastern United States and northern California. It discusses the recent guilty verdict returned in the trial against John Bennett, a former CEO extradited to face charges for kickbacks and fraud. And it details the division’s work to protect competition in online marketplaces and among firms that help out the heirs of people who died without a will.
Finally, the update explores the division’s competition advocacy in the U.S., its efforts to provide guidance on important issues about the intersection of intellectual property and antitrust, and its work with enforcers across the globe to protect competition and promote sound enforcement of antitrust laws.
Follow the Antitrust Division on Twitter.
Albuquerque Man Sentenced to Prison for Conviction Arising Out of Robbery of Retail Pharmacy in August 2014Read the Press Release
ALBUQUERQUE – Roy Christopher, 29, of Albuquerque, N.M., was sentenced today in federal court to 41 months in prison followed by three years of supervised release for his theft of medical products conviction arising out of the robbery of an Albuquerque-area retail pharmacy in Aug. 2014.
Christopher was one of six defendants charged in four indictments that were announced by federal and local officials on April 29, 2015. The indictments alleged that the six defendants robbed retail pharmacies in Albuquerque to illegally obtain Oxycodone and other highly addictive opioid painkillers. The four indictments charged Christopher and five other Albuquerque residents with crimes arising out of the armed robberies of retail pharmacies, including violations of the Controlled Substance Registrant Protection Act and the Safe Doses Act, laws passed to address the theft and diversion of prescription drugs.
Christopher was indicted on April 28, 2015, and charged with (1) violating the Hobbs Act by interfering with interstate commerce by robbery and violence; (2) violating the Safe Doses Act by theft of medical products; and (3) possession of Oxycodone with intent to distribute. The charges against Christopher arise out of the robbery of a CVS Pharmacy on Aug. 3, 2014.
On Nov. 17, 2015, Christopher pled guilty to Count 2 of the indictment charging him with violating the Safe Doses Act by robbery involving controlled substances. In entering the guilty plea, Christopher admitted that on Aug. 3, 2014, he entered the CVS pharmacy and handed the attending pharmacy employee a note demanding Oxycodone and that the pharmacy employee complied with his demand. Christopher was apprehended shortly after the robbery. Christopher admitted that he stole more than 200 Oxycodone pills of various dosages during the robbery.
The pharmacy robbery cases involving the other five defendants have been resolved as follows:
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On July 1, 2015, Victor Hurtado, 20, pled guilty to felony charges arising out of the Jan. 6, 2015, armed robbery of the Smith’s Pharmacy located at 4016 Louisiana Blvd. NE in Albuquerque. Hurtado was sentenced on Dec. 10, 2015, to 141 months in federal prison followed by five years of supervised release.
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On Sept. 17, 2015, Valentin Garcia, 23, pled guilty to felony charges arising out of the Jan. 30, 2015, armed robbery of the CVS Pharmacy located at 4201 Montano in Albuquerque.Garcia was sentenced on Dec. 17, 2015, to ten years in federal prison followed by three years of supervised release.
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On Sept. 4, 2015, Blake Gallardo, 22, pled guilty to felony charges arising out of the June 6, 2015, robbery of a Walgreens Pharmacy located at 1201 Unser Blvd. NW in Albuquerque.Gallardo was sentenced on Dec. 15, 2015, to 15 years in federal prison followed by three years of supervised release.
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On Sept. 24, 2015, Josephine Duran, 23, pled guilty to felony charges arising out of the June 6, 2015, robbery of a Walgreens Pharmacy located at 1201 Unser Blvd. NW in Albuquerque.Under the terms of her plea agreement, Duran will be sentenced to a prison term within the range of 48 to 100 months.
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On Jan. 19, 2016, Joseph Montano, 23, pled guilty to felony charges arising out of the Jan. 6, 2015, armed robbery of the Smith’s Pharmacy located at 4016 Louisiana Blvd. NE in Albuquerque. Under the terms of his plea agreement, Montano will be sentenced within the range of 80 to 120 months in federal prison.
These cases were investigated by the Albuquerque office of the FBI, the Tactical Diversion Squad of the DEA in Albuquerque, and the Albuquerque Police Department, with assistance from the 2nd Judicial District Attorney’s Office in Bernalillo County. The cases are being prosecuted by Assistant U.S. Attorneys Shaheen P. Torgoley and Joel R. Meyers.
DEA’s Tactical Diversion Squads combine DEA resources with those of federal, state and local law enforcement agencies in an innovative effort to investigate, disrupt and dismantle those suspected of violating the Controlled Substances Act or other appropriate federal, state or local statutes pertaining to the diversion of licit pharmaceutical controlled substances or listed chemicals.
These cases are being prosecuted pursuant to a federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders for federal prosecution with the goal of removing repeat offenders from communities in New Mexico for as long as possible. Because New Mexico’s violent crime rates, on a per capita basis, are amongst the highest in the nation, New Mexico’s law enforcement community is collaborating to target repeat offenders from counties with the highest violent crime rates, including Bernalillo County, under this initiative.
The cases also are being prosecuted pursuant to the New Mexico Heroin and Opioid Prevention and Education (HOPE) Initiative. The HOPE Initiative is a collaborative effort between the U.S. Attorney’s Office and the University of New Mexico Health Sciences Center that is partnering with the Bernalillo County Opioid Accountability Initiative with the overriding goal of reducing the number of opioid-related deaths in the District of New Mexico. The HOPE Initiative comprised of five components: (1) prevention and education; (2) treatment; (3) law enforcement; (4) reentry; and (5) strategic planning. The law enforcement component of the HOPE Initiative is led by the Organized Crime Section of the U.S. Attorney’s Office and the DEA in conjunction with their federal, state, local and tribal law enforcement partners. Targeting members of major heroin and opioid trafficking organizations for investigation and prosecution is a priority of the HOPE Initiative.
The Controlled Substance Registrant Protection Act was enacted in 1984, to combat the theft of prescription drugs from individuals and businesses registered with the DEA. It created penalties for entering a pharmacy’s premises for the purpose of stealing controlled substances, and includes enhanced punishment for using a dangerous weapon. The Safe Doses Act was enacted in Oct. 2012, to fight medical theft and protect patients from unknowingly using stolen and mishandled drugs. It provides for enhanced sentences for those who rob pharmacies of controlled substances; individuals who steal medical products; and “fences” who knowingly obtain stolen medical products for resale in the supply chain.
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***media Advisory***Read the Press Release
CHARLESTON, W.Va. – The United States Attorney's Office for the Southern District of West Virginia, along with federal, state and local advocates of crime victims’ rights, will host an opening ceremony in recognition of National Crime Victims' Rights Week on Monday, April 11, 2016, at noon in the Robert C. Byrd United States Courthouse in Charleston.
The ceremony will feature officials working in the criminal justice system, agencies and organizations providing services to crime victims, and crime victims themselves who can speak firsthand to their experience. As part of the event, there will be a presentation of the 2016 Excellence in Victim Advocacy and Justice Award to Huntington Police Chief Joe Ciccarelli.
This ceremony marks the 16th Annual Operation Reach Out event. Operation Reach Out is a collaborative group of federal, state and local agencies and organizations that work to raise awareness about the rights, protections, and services available to crime victims in West Virginia. This event is being held in conjunction with the nationwide observance of National Crime Victims' Rights Week, which begins on April 10 and runs through April 16, 2016. The theme of National Crime Victims' Rights Week this year is "Serving Victims. Building Trust. Restoring Hope."
WHO:
- Acting United States Attorney Carol Casto
- Kandi Burns, Crime Victim Survivor
- Elaine and Stephanie Wagner, Crime Victim Survivors
- Huntington Police Chief Joe Ciccarelli, Recipient of the 2016 Excellence in Victim Advocacy and Justice Award
- Operation Reach Out committee members
- Other federal, state and local officials
- Staff representing the United States Attorney's Office, Southern District of West Virginia
WHAT:
- Operation Reach Out Opening Ceremony for National Crime Victims’ Rights Week
WHERE:
- Robert C. Byrd United States Courthouse – Fifth Floor
- 300 Virginia Street, East
- Charleston, WV 25301
WHEN:
- Monday, April 11, 2016, at noon. The ceremony will immediately follow a reception and lunch beginning at noon.
Follow us on Twitter: SDWVNews
Thursday 7 April 2016
Weldon Man Sentenced for Selling Crack CocaineRead the Press Release
RALEIGH – The United States Attorney’s Office for the Eastern District of North Carolina announced that in federal court today, United States District Judge Terrence W. Boyle, sentenced LUTHER ALLEN TERRY, 33, of Weldon, North Carolina, to 96 months in prison and 10 years of supervised released for distribution of crack cocaine. TERRY previously pled guilty to this charge on September 4, 2015.
On April 16 and 17, 2014, the Halifax County Sheriff’s Office used an informant to buy crack cocaine from TERRY twice near the Weldon High School in Weldon, N.C.
TERRY received an enhanced punishment as a career offender based on his two prior state convictions for selling cocaine.
The investigation of this case was conducted by the Halifax County Sheriff’s Office. The federal prosecution was handled by Special Assistant United States Attorney Glenn Perry. Mr. Perry is a prosecutor with the Pitt County District Attorney’s Office. Pitt County District Attorney Kimberly Robb has assigned Mr. Perry to the United States Attorney’s Office to prosecute federal Organized Crime Drug Enforcement Task Force criminal matters. Mr. Perry’s assignment to the United States Attorney’s Office has been made possible by grants funded by the Governor’s Crime Commission.
Wallingford Man Charged with Operating Ponzi SchemeRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that a federal grand jury in New Haven returned an 18-count indictment yesterday charging JOSEPH A. CASTELLANO, 58, of Wallingford, with fraud and money laundering offenses stemming from an investment scheme that defrauded individuals of more than $1.5 million.
As alleged in the indictment, CASTELLANO operated various entities out of offices in Wallingford, including Casbo Investments, Wallingford Investors Limited Partnership, AIM Realty Investors, and Castellano & Co., LLC. As a Certified Public Accountant and owner of Castellano & Co., LLC, CASTELLANO prepared federal and state tax returns for individuals and local businesses. In connection with his tax preparation business, CASTELLANO established a base of clients to which he offered financial services and investment opportunities in addition to preparing their taxes.
The indictment alleges that, beginning in approximately July 2007, CASTELLANO falsely represented to victim-investors that he had clients who were in need of capital to fund businesses or real estate development projects, but were unable to secure funding from traditional sources such as financial institutions. CASTELLANO told victim-investors that he would obtain for them a consistent rate of return of between approximately six percent and eight percent annually on their money by taking their money and placing it with, or loaning it to, one or more of his other clients. CASTELLANO, through Casbo Investments, prepared and executed official-looking documents and investment contracts termed “Demand Notes,” which contained a promise to return the principal amount, with interest, at any time.
In fact, there were no actual investments or investment opportunities, and the money was not invested with or loaned to other clients of CASTELLANO. CASTELLANO diverted the funds for his own use and benefit, including making payments to other victim-investors that were falsely represented to be “interest” payments. CASTELLANO also made false statements to certain victim-investors to explain various delays in the purported interest payments.
Through this scheme, it is alleged that CASTELLANO defrauded more than 10 victim-investors of more than $1.5 million.
CASTELLANO was arrested yesterday and detained. He appeared today before U.S. Magistrate Judge Sarah A. L. Merriam in New Haven and was released on a $250,000 bond.
The indictment charges CASTELLANO with 10 counts of wire fraud, one count of mail fraud and four counts of securities fraud, offenses that carry a maximum term of imprisonment of 20 years on each count. The indictment also charges CASTELLANO with three counts of money laundering, an offense that carries a maximum term of imprisonment of 10 years 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 Federal Bureau of Investigation, Internal Revenue Service – Criminal Investigation Division, and U.S. Postal Inspection Service. The case is being prosecuted by Assistant U.S. Attorneys Michael McGarry and John Pierpont.
Two from Youngstown area charged with firearms violations in 18-count indictmentRead the Press Release
A federal grand jury returned an 18-count indictment charging Tamyra Gudzinas, 74, of Hubbard, Ohio, and Elie J. Faraj, 31, of Youngstown, with various firearms violations, law enforcement officials said.
Thirteen counts of the indictment allege that on various dates beginning in August 2015 until on or about December 8, 2015, Gudzinas, aided and abetted by Faraj, made false and fictitious written statements to federally licensed firearm dealers, stating that she was purchasing the firearms for herself, when she was purchasing the firearms for another individual. The dates and locations of these purchases are as follows:
Date
Firearm Dealer
Firearm
8/24/15
Gander Mountain, Warren, OH
Sig Sauer P238, .380 caliber pistol
10/13/15
Miller Road and Gun
Youngstown, OH
Glock 22, .40 caliber pistol
10/14/15
Buckeye Firearms
Austintown, OH
Glock, model 19, 9mm pistol
10/16/15
Miller Road and Gun
Youngstown, OH
Glock, model 19, 9mm pistol
10/24/15
Stocker’s Shop
Warren, OH
Kahr, model CT380, .380 caliber pistol, and a
Glock, model 22, .40 caliber pistol
10/25/15
J&D Firearms
Warren, OH
Glock, model 19, 9mm pistol, and a
Taurus Millennium, 9mm pistol
11/13/15
Stocker’s Shop
Warren, OH
Glock, model 17, 9mm pistol
11/23/15
Miller Road and Gun
Youngstown, OH
Glock, model 27, .40 caliber pistol
11/23/15
Buckeye Firearms
Austintown, OH
Glock, model 17, 9mm pistol, and a
Kahr .380 caliber
11/24/15
Buckeye Firearms
Austintown, OH
Smith and Wesson, model MNP15, 5.56 caliber rifle
11/26/15
Tactical Firearms
Youngstown, OH
Glock, model 21, .45 caliber pistol and a
Glock, model 30, .45 caliber pistol
12/4/15
Tactical Firearms
Youngstown, OH
Glock, model 30, .45 caliber pistol;
Smith and Wesson M360, .38 caliber rifle;
Sig Sauer, model P938, 9mm pistol; and an
Anderson Mfg., model AM-15, 5.56 caliber rifle
12/8/15
Buckeye Firearms
Austintown, OH
Sig Sauer, model P239, .40 caliber pistol
Four counts of the indictment allege Faraj, having been previously convicted of possession of cocaine in the Mahoning County Court of Common Pleas in 2012, illegally possessed the following firearms on the following dates:
Dates
Firearms
10/24/15
Kahr, model CT380, .380 caliber pistol
11/23/15
Glock, model 17, 9mm pistol
12/4/15
Glock, model 30, .45 caliber pistol
12/4-12/11/15
Sig Sauer, model P938, 9mm pistol, and an
Anderson Mfg. AM-15, 5.56 caliber rifle12/8-12/11/15
Sig Sauer, model P239, .40 caliber pistol
“We will continue to work with our partners in law enforcement to prosecute those people who get firearms despite prohibitions against them – and those who illegally help them get the guns,” said Acting U.S. Attorney Carole S. Rendon.
“This case demonstrates one avenue by which firearms end up in the hands of violent criminals,” said Donald J. Soranno, ATF Special Agent in Charge for the Columbus Field Division. “ATF will continue to work with our federal, state, and local partners to close off these illegal transfers and keep firearms out of the hands of those who would use them to harm and intimidate others.”
“These suspects facilitated arming individuals that were attempting to conceal their possession and use of firearms,” said Steven D. Anthony, Special Agent in Charge of the FBI’s Cleveland Office. “The FBI and its partners will continue efforts to stem the flow of illegal firearms to the criminal element.”
If convicted, the defendants’ sentences will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
The investigation preceding the indictment was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Federal Bureau of Investigation and the FBI Violent Crimes Task Force. The matter is being prosecuted by Assistant United States Attorney Jason M. Katz.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Two drug dealers appear in Federal court for heroin crimesRead the Press Release
CHARLESTON, W.Va. – Two heroin dealers appeared in federal court today for drug crimes, announced Acting United States Attorney Carol Casto. Antoine Joshua Broner, 37, of Charleston, was sentenced to a year and four months in federal prison for distribution of heroin. In a separate prosecution, Lawrence Matthew Garner, 34, of Parkersburg, pleaded guilty to possession with intent to distribute heroin.
Broner admitted that on August 4, 2015, he sold heroin to a confidential informant working with law enforcement. Following the drug deal, officers seized $615 from Broner’s house in Charleston, $75 of which was pre-recorded buy money used in the controlled purchase with the confidential informant. Broner further admitted to possessing additional heroin at his residence that he intended to distribute.
In a separate heroin prosecution, Garner admitted that on July 16, 2015, he was arrested by members of the South Charleston Police Department for delivery of a controlled substance. During a search incident to arrest, officers found over 37 grams of heroin in Garner’s possession. Garner faces up to 20 years in federal prison and a $1 million fine when he is sentenced on July 14, 2016.
The investigation of Broner was conducted by the Metropolitan Drug Enforcement Network Team. Assistant United States Attorney Jennifer Rada Herrald is in charge the prosecution of Broner. The case against Garner was investigated by the South Charleston Police Department. Assistant United States Attorney Timothy D. Boggess is handling the prosecution. The defendants appeared before United States District Judge Thomas E. Johnston.
This case is part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and heroin. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of pills and heroin in communities across the Southern District.
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Two Men Charged in Separate Complaints with Child Pornography OffensesRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051BUFFALO, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that Joseph Kurowski, 23, of Buffalo, NY, was arrested and charged by complaint with production, receipt and possession of child pornography. In addition, Jose Cisneros, 30, of Buffalo, NY, was also arrested and charged by criminal complaint with production and receipt of child pornography. The charges carry a mandatory minimum sentenced of 15 years in prison, a maximum of 30 years and a $250,000.
“These two cases, along with today’s conviction of Anthony Thompson, depict the dark side of modern communication devices and applications” said U.S. Attorney Hochul. “The cases also serve as a warning to all of the many ways predators seek to manipulate children through technology into engaging in sexually explicit conduct. By education and dialogue, such conduct – which criminals would otherwise seek to keep in the shadows – can be exposed and prevented.”
Assistant U.S. Attorney Aaron J. Mango, who is handling both cases, stated that according to the complaint against Kurowski, in August 2015, the Blasdell Police Department received a report involving a 13 year old female (victim 1) who engaged in sexually explicit conversations with numerous individuals, including the defendant, using the Kik application and through text messages. Between September 21 and 23, 2015, an undercover law enforcement officer used victim 1’s Kik account and engaged Kurowski in a chat sessions during which the two discussed meeting in person.
On October 21, 2015, the Federal Bureau of Investigation executed a search warrant at the defendant’s residence and seized a laptop computer and cellular telephone. During an analysis of the items, officers recovered conversations with a 15 year old female (victim 2) that took place over the Whisperer application and Snapchat. During one of those conversations, Kurowski told victim 2 that he had a lawyer and that “some girls mom told the police I was coercing her to meet for sex. Didn’t meet.”
Officers also recovered Kik conversations between the defendant and a 16 year old female (victim 3). Victim 3 told officers she met Kurowski on Whisperer before moving the conversations to Kik. She said she “vaguely” recalled sending the defendant pictures and videos. She also said that Kurowski threatened to hurt her if she did not participate in the sexting and send him sexual videos.
Officers also found explicit conversations between the defendant and a 17 year old female (victim 4).
According to the complaint against Cisneros, also in August 2015, the Blasdell Police Department alerted the FBI about a 13 year old female (victim 1) engaging in sexually explicit conversations using the Kik application and text messages with an individual later identified as Cisneros. During their communications, the defendant and victim 1 exchanged graphic photos.
The complaint further states that during an interview with the FBI, the mother of Cisneros’s two children told agents that she found a phone belonging to the defendant which contained a sexual text conversation. The woman confronted Cisneros which resulted in an argument that led to police responding to the residence.
Cisneros and Kurowski both made initial appearances before U.S. Magistrate Judge Michael J. Roemer and are being detained pending detention hearings schedule for April 8, 2016 at 10:30 a.m. and 11:00 a.m. respectively.
The complaints are the result of an investigation by the Federal Bureau of Investigation’s Child Exploitation Task Force, under the direction of Special Agent in Charge Adam S. Cohen and the Blasdell Police Department, under the direction of Lieutenant Joseph Gramaglia. The task force includes the Buffalo Police Department, Cheektowaga Police Department, and Niagara County Sheriff’s Office.
Three Maryland Residents Indicted in Six Year Scheme to Scam Car Dealers and LendersRead the Press Release
Baltimore, Maryland – A federal grand jury indicted the following Maryland residents on wire fraud and money laundering charges arising from a scheme to defraud auto dealers and lenders in the counties of Anne Arundel, Howard, Baltimore and Montgomery, of at least $550,000:
Sean Stanley Jackson, age 43, of Baltimore;
Erika Patrice Ryles, age 35, of Baltimore; and
Walter Jermaine Perry, III, age 39, of Owings Mills.
The indictment was returned on March 30, 2016 and unsealed today at the initial appearances of the defendants before U.S. Magistrate Judge J. Mark Coulson in U.S. District Court in Baltimore. Defendants Ryles and Perry were released under pretrial supervision while defendant Jackson was detained pending a detention hearing scheduled for Friday, April 8, 2016 at 2:00 p.m.
The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Thomas Jankowski of the Internal Revenue Service - Criminal Investigation, Washington, D.C. Field Office; Chief James W. Johnson of the Baltimore County Police Department; and Commissioner Kevin Davis of the Baltimore Police Department.
“The illegal activity alleged in the indictment regarding this fraud scheme was extensive,” said Thomas Jankowski, Special Agent in Charge, IRS Criminal Investigation, Washington D.C. Field Office. “IRS Criminal Investigation, in conjunction with our law enforcement partners, is committed to investigating financial fraud cases.”
According to the 15 count indictment, from January 2010 to February 2016, Jackson, Perry and another co-conspirator would make false representations on loan applications to lenders in order to obtain loans to buy vehicles from dealers, for which they were not financially qualified. The indictment alleges that 13 loan applications were submitted electronically to purchase vehicles, including a Bentley, Corvette, Corvette Stingray, Cadillac, two Audis and two Ford F450s.
The indictment alleges that the defendants created shell entities purporting to be legitimate businesses engaged in, among other things, global investing, consulting, dump truck transportation and wholesale auto dealing. The defendants created fake documents, including paystubs, bank account statements, utility bills and corporate tax returns and schedules for the shell entities, which they submitted with auto loan applications. The defendants sold some of the fraudulently obtained autos by causing false lien releases or obtaining false titles that omitted the lenders’ liens on the automobiles.
The indictment seeks forfeiture of at least $550,000, the amount of proceeds of the fraud scheme.
All of the defendants face a maximum sentence of 20 years in prison for wire fraud conspiracy. Jackson also faces a maximum sentence of 20 years in prison on six counts of wire fraud; a maximum sentence of 30 years in prison on seven counts of wire fraud involving a financial institution; and 20 years in prison for money laundering. Perry also faces a maximum sentence of 20 years in prison for wire fraud.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
Today’s announcement is part of the efforts undertaken 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’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. 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.
United States Attorney Rod J. Rosenstein commended the IRS - Criminal Investigation and Baltimore County and City Police Departments for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Philip A. Selden and Dana J. Brusca, who are prosecuting the case.
Terry Resident Charged with Bankruptcy FraudRead the Press Release
Jackson, Miss – Kenneth Bowman, Jr., 62, of Terry, Mississippi, has been charged in a federal indictment with three counts of bankruptcy fraud, announced U. S. Attorney Gregory K. Davis, Acting U. S. Trustee Henry G. Hobbs, Jr. of Region 5, and FBI Special Agent in Charge Donald Alway.
According to the indictment, Bowman, as the officer and representative of Piggly Wiggly of Crystal Springs, Inc., a debtor in Chapter 11 bankruptcy in the Southern District of Mississippi, embezzled approximately $101,733.55 from the bankruptcy estate. Bowman appropriated to his own use estate funds belonging to the debtor, specifically making checks payable to himself, and reducing assets available to creditors. If convicted, Bowman faces a maximum penalty of fifteen years in prison.
Bowman was arraigned before U.S. Magistrate Judge F. Keith Ball in Jackson today. He is scheduled for trial before U.S. District Judge Tom S. Lee on June 6, 2016.
The Office of the U. S. Trustee and the U.S. Bankruptcy Court for the Southern District of Mississippi referred the matter to the U. S. Attorney for prosecution. The Federal Bureau of Investigation and the U.S. Trustee assisted in the investigation and indictment of Bowman.
The public is reminded that an indictment is a formal charge that a defendant has committed a violation of the federal criminal laws. All defendants are presumed innocent unless and until proven guilty.
Ten indicted for bringing crystal methamphetamine to Ohio from CaliforniaRead the Press Release
Ten people were indicted for their roles in a conspiracy that brought large shipments of crystal methamphetamine to Ohio from California, law enforcement officials said.
Named in the 20-count indictment are: Hector Sabino Gonzales, 36, of Los Angeles; Carlos Elias, 33, and Lisa Elias, 36, both of Massillon; Jance Randolph, 33, of Canton; Michael Mack, 39, of Akron; Nikki Greenwood, 37, of New Philadelphia; Richard Stewart, 57, of Akron; Robert Willham, 45, of Medina; Steven Petit, 35, of Akron, and Wilmer Martinez, 25, of Painesville.
The Elias’s also face charges for distribution of heroin. Stewart is charged with being a felon in possession of a firearm.
Carlos Elias received large shipments of methamphetamine from Gonzales and others in California, usually via FedEx or UPS, from June 2015 through March 2016. Court documents detail shipments of methamphetamine to homes in Akron, New Philadelphia and Painesville, among others. The Elias’s sent cash via FedEx, UPS and the U.S. mail to Gonzales to pay for the drugs, according to the indictment.
The Elias’s provided methamphetamine to Martinez, Mack, Greenwood, Willham, Stewart, Randolph and others for distribution. Mack supplied methamphetamine to Petit for distribution, according to the indictment.
This case is being prosecuted by Assistant U.S. Attorney Teresa Riley following an investigation by the Federal Bureau of Investigation and the Stark County Safe Streets Task Force, which includes the police departments of Canton, Jackson Township, Alliance, Louisville and Ohio Adult Parole Authority.
If convicted, the defendant’s sentence will be determined by the court after a review of the federal sentencing guidelines and factors unique to the case, including the defendant’s prior criminal record (if any), the defendant’s role in the offense, and the characteristics of the violation.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.