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Thursday 10 March 2016
Nassau County Man Sentenced to More Than Five Years for Receiving Child Pornography over the InternetRead the Press Release
Jacksonville, FL – Senior United States District Judge Harvey E. Schlesinger has sentenced Jeremy Chris Cartrette (39, Yulee) to five years and six months in federal prison for receiving child pornography over the Internet. He also was ordered to forfeit his computer media and, upon his release from prison, to serve a 15-year term of supervision and register as a sex offender.
According to court documents, during an undercover FBI task force investigation, an officer connected to a host computer and downloaded several images of child pornography. Further investigation traced the host computer to Cartrette’s residence.
On June 19, 2015, law enforcement officers executed a federal search warrant at Cartrette’s home and seized a laptop computer and an external hard drive. During an interview, Cartrette stated that he began downloading child pornography “a couple of years ago,” and that he had tried to quit before but that he “always comes back to it.” Forensic analyses of Cartrette’s computer media revealed at least 7 videos and 19 images of child pornography.
This case was investigated by the Federal Bureau of Investigation, the Columbia County Sheriff’s Office, and the Nassau County Sheriff’s Office. It was prosecuted by Assistant United States Attorney D. Rodney Brown.
It is another case 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 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.
Mo Money Tax Return Preparers Plead Guilty to Conspiracy to Defraud the United States and Filing False Tax ReturnsRead the Press Release
Two tax return preparers pleaded guilty to one count of conspiracy to defraud the United States and one count of aiding and assisting in the preparation of a false tax return, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney Dana Boente of the Eastern District of Virginia.
According to court documents, Jeremy Blanchard, 35, and Erik Pittman, 35, both of Memphis, Tennessee, and others prepared numerous false tax returns for the 2011 tax year for customers of their tax return preparation business. Blanchard, who pleaded guilty yesterday, and Pittman, who pleaded guilty today, were preparers in Mo Money Taxes, which operated three locations in the Richmond, Virginia area. Blanchard and Pittman admitted that they created and inflated fictitious and fraudulent tax credits, including the Earned Income Credit and the American Opportunity credit, to claim tax refunds that customers were not entitled to receive. As part of their guilty pleas, Blanchard and Pittman admitted that their conduct caused a loss to the Internal Revenue (IRS) of more than $250,000, but less than $550,000.
“Fraudulent tax return preparers, like Mr. Blanchard and Mr. Pittman, are facilitating the theft of funds from the American people by preparing false tax returns for customers,” said Acting Assistant Attorney General Ciraolo. “The department will continue to pursue and prosecute these offenders to the fullest extent of the law.”
Blanchard and Pittman each face a statutory maximum sentence of five years in prison and a $250,000 fine on the conspiracy charge and three years in prison and a $250,000 fine on the charge of aiding and assisting in the preparation of false tax returns. U.S. District Judge John A. Gibney for the Eastern District of Virginia set sentencing for June 8, 2016.
Another participant in this scheme, Corey Taylor, 25, of Richmond, pleaded guilty in October 2015 to one count of conspiracy to defraud the United States and one count of aiding and assisting in the preparation of a false tax return. He is awaiting sentencing.
Acting Assistant Attorney General Ciraolo and U.S. Attorney Boente thanked special agents of IRS-Criminal Investigation, the FBI, and the U.S. Postal Inspection Service, who investigated the case and Trial Attorneys Kevin F. Sweeney and Todd Kostyshak of the Tax Division and Assistant U.S. Attorney Stephen Miller of the Eastern District of Virginia, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Mo Money Tax Return Preparers Plead Guilty Conspiracy to Defraud the United States and Filing False Tax ReturnsRead the Press Release
RICHMOND, Va. – Jeremy Blanchard, 35, and Erik Pittman, 35, both of Memphis, Tennessee, pleaded guilty today to charges of conspiracy to defraud the United States and one count of aiding and assisting in the preparation of a false tax return.
In a statement of facts filed with the plea agreement, Blanchard, Pittman, and others prepared numerous false tax returns for the 2011 tax year for customers of their tax return preparation business. Blanchard, who pleaded guilty yesterday, and Pittman, who pleaded guilty today, were preparers in Mo Money Taxes, which operated three locations in Richmond. Blanchard and Pittman admitted that they created and inflated fictitious and fraudulent tax credits, including the Earned Income Credit and the American Opportunity credit, to claim tax refunds that customers were not entitled to receive. As part of their guilty pleas, Blanchard and Pittman admitted that their conduct caused a loss to the Internal Revenue Service (IRS) of more than $250,000, but less than $550,000.
Blanchard and Pittman each face a maximum penalty of a total of eight years in prison and a $500,000 fine when sentenced on June 8, 2016. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Caroline D. Ciraolo, Acting Assistant Attorney General of the Justice Department’s Tax Division; and Thomas Jankowski, Special Agent in Charge of IRS-Criminal Investigations, Washington D.C. Field Office, made the announcement after the plea was accepted by U.S. District Judge John A. Gibney. This case was investigated by IRS-Criminal Investigations, the FBI's Richmond Field Office, and the U.S. Postal Inspection Service. Assistant U.S. Attorney Stephen Miller, and Trial Attorneys Kevin F. Sweeney and Todd Kostyshak of the Tax Division are prosecuting 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. 3:15-cr-136.
Missouri Man Sentenced for Attempting to Pass Forged PrescriptionsRead the Press Release
The Acting United States Attorney for the Southern District of Illinois, James L. Porter, announced today that Luke Xavier Lore, 48, formerly of Saint Louis, Missouri, was sentenced in the U.S. District Court in Benton, Illinois, on March 9, 2016. Lore had been convicted of two counts of Attempting to Acquire or Obtain a Controlled Substance by Misrepresentation, Fraud, Forgery, Deception or Subterfuge. The District Court sentenced Lore to 9 months in prison, to be followed by 1 year of supervised release, with the first 180 days in a halfway house. The Court also ordered Lore to pay a $200 fine and a $200 special assessment.
According to facts revealed in Court, on February 2, 2015, in Madison County, and on April 6, 2015 in Saint Clair County, Lore created fraudulent prescriptions and attempted to have them passed at pharmacies. In February 2015, he attempted to illegally obtain Hydrocodone, a Schedule II controlled substance, and Alprazolam (trade name: Xanax), a Schedule IV controlled substance. In April 2015, he attempted to illegally obtain Hydrocodone (trade name: Norco).
The case was investigated by Drug Enforcement Administration with the assistance of the Alton Police Department. The case is being prosecuted by Assistant U.S. Attorney William E. Coonan.
Mexican Nationals Plead Guilty to Federal Cocaine Trafficking ChargesRead the Press Release
ALBUQUERQUE – Two Mexican nationals pled guilty yesterday in federal court in Las Cruces, N.M., to cocaine trafficking charges under plea agreements with the U.S. Attorney’s Office.
Luzelena Lopez, 41, and Alma Ivonne Chavez-Guevara, 35, both Mexican nationals, were arrested in Nov. 2015, and charged in a criminal complaint with conspiracy and possession of cocaine with intent to distribute on Nov. 11, 2015, in Otero County, N.M. According to the criminal complaint, Lopez and Chavez-Guevara were arrested after U.S. Border Patrol agents at the Border Patrol Checkpoint on Highway 70 in Otero County, found approximately 8.7 kilograms (19.22 pounds) of cocaine wrapped in eight bundles inside a duffel bag in their vehicle.
During yesterday’s proceedings, Lopez and Chavez-Guevara pled guilty to a felony information charging them with conspiracy to possess cocaine with intent to distribute. Both women admitted that on Nov. 11, 2015, they were stopped at the Border Patrol Checkpoint on Highway 70. During an inspection of their vehicle, Chavez Guevara admitted that she was present in the United States without permission. Thereafter, the agents found the cocaine in a duffel bag on the rear passenger floorboard. Lopez and Chavez-Guevara admitted that they previously agreed with each other and others to deliver the cocaine to Kansas in exchange for payment.
At sentencing, Lopez and Chavez-Guevara each face a maximum penalty of 20 years in federal prison. Both women will be deported following their incarceration. Lopez and Chavez-Guevara remain in custody pending sentencing hearings which have yet to be scheduled.
This case was investigated by the Las Cruces office of the DEA and the Alamogordo station of the U.S. Border Patrol. Assistant U.S. Attorney Randy M. Castellano of the U.S. Attorney’s Las Cruces Branch Office is prosecuting the case.
Mescalero Apache Man Pleads Guilty to Federal Assault ChargesRead the Press Release
ALBUQUERQUE – Corinne Delphine Kinzhuma, 30, an enrolled member of the Mescalero Apache Nation who resides in Mescalero, N.M., pleaded guilty yesterday afternoon in federal court in Las Cruces, N.M., to assault charges.
Kinzhuma was arrested on Feb. 26, 2015, on a criminal complaint charging her with assaulting a Mescalero Apache man on Dec. 12, 2014, by stabbing him repeatedly in neck, chest, arm and cheek. The assault occurred on the Mescalero Apache Indian Reservation in Otero County, N.M. As a result of the assault, the victim required a chest tube and admission to the surgical intensive care unit for continuous monitoring of his neck wound; he also suffered a fracture of the left radius.
Kinzhuma was subsequently indicted on June 17, 2015, and charged with assault with a dangerous weapon, a knife, with intent to do bodily harm and assault resulting in serious bodily injury on Dec. 12, 2014, in Indian Country in Otero County. During yesterday’s proceedings, Kinzhuma entered a guilty plea to the indictment without the benefit of a plea agreement.
At sentencing, Kinzhuma faces a statutory maximum of ten years in federal prison. Kinzhuma remains in custody pending a sentencing hearing which has yet to be scheduled.
This case was investigated by the Las Cruces office of the FBI and the Mescalero Agency of the BIA’s Office of Justice Services and is being prosecuted by Assistant U.S. Attorney Aaron O. Jordan of the U.S. Attorney’s Las Cruces Branch Office.
Martha’s Vineyard Man Sentenced for Social Security Fraud and Tax EvasionRead the Press Release
BOSTON – An Oak Bluffs man was sentenced today in U.S. District Court in Boston for stealing $160,025 in Social Security benefits and falsifying his 2010 tax return.
Vernon Harris, 63, was sentenced by U.S. District Court Judge Douglas P. Woodlock to six months in prison, three years of supervised release, and was ordered to pay $160,025 in restitution to the Social Security Administration and $21,605 to the Internal Revenue Service. In December 2015, Harris pleaded guilty to theft of public money and tax evasion.
In 2002, Harris applied for Social Security Disability Insurance benefits. In his application, Harris stated that he stopped working in 2001 due to his disabilities; however, in reality, Harris was running a trucking brokerage firm called SilkRoad Logistics out of his home on Martha’s Vineyard when he applied for benefits. Harris wrote himself checks from the business’s account totaling as much as $60,000 to $70,000 in some years and concealed the business from the Social Security Administration (SSA). Harris listed his wife as the proprietor of SilkRoad Logistics on tax returns to conceal the fact that he operated the business. In a 2012 letter Harris sent to the SSA, he falsely affirmed, “my wife is and has been the sole income earner in our household since my disability in 2001.” Harris continued to collect disability benefits while running SilkRoad Logistics until 2015. In total, he illegally received $160,025 in benefits. Harris also falsified information pertaining to SilkRoad Logistics on his 2010 federal income tax return.
United States Attorney Carmen M. Ortiz; Scott Antolik, Special Agent in Charge of the Social Security Administration, Office of Inspector General, Office of Investigations, Boston Field Division; and Many J. Muriel, Acting Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston, made the announcement today. The case was prosecuted by Special Assistant U.S. Attorney Timothy Landry of Ortiz’s Major Crimes Unit.
Macy Man Sentenced for Killing His BrotherRead the Press Release
United States Attorney Deborah R. Gilg announced that Daniel Webster, III, age 23, of Macy, Nebraska, was sentenced for his conviction on a charge of voluntary manslaughter. Senior United States District Court Judge Lyle E. Strom sentenced Webster to 48 months of imprisonment to be followed by three years of supervised release.
On August 28, 2014, Webster was at an abandoned house on the Omaha Indian Reservation along with his brother and several other people, some being minors and some being adults. The adults had been drinking throughout the afternoon and early evening. Webster’s brother became increasingly agitated towards his girlfriend causing Webster to intervene. Webster’s brother then began arguing with Webster and a physical altercation ensued. During the altercation Webster stabbed his brother in the neck with a paring knife. Webster’s brother was unarmed at the time. After being stabbed, Webster’s brother attempted to leave the residence, however, he collapsed on the front porch where he later died. An autopsy showed that Webster’s knife had severed his brother’s carotid artery and punctured the trachea.
This case was investigated by the Federal Bureau of Investigation.
Loves Park Man Indicted on Child Pornography ChargesRead the Press Release
ROCKFORD — A Loves Park, Ill. man appeared today before U.S. Magistrate Judge Iain D. Johnson on child pornography charges.
GRANT WOJAHN, 35, of Loves Park, Ill., was indicted on Feb. 2, 2016, by a federal grand jury in Rockford and charged with one count of using a minor to engage in sexual conduct in order to produce child pornography, one count of transporting child pornography via the internet, and two counts of possessing child pornography that had crossed state lines, including an image of a minor under 12 years of age. Wojahn was arrested on Feb. 8, 2016, in Marin County, Cal., and transported by federal authorities back to Rockford. Wojahn pleaded not guilty during his arraignment today before U.S. Magistrate Judge Iain D. Johnston and was ordered held in federal custody until a detention hearing on March 15, 2016, at 2:30 p.m.
Sexual exploitation of a child for the purpose of producing child pornography carries a mandatory minimum of 15 years and a maximum of 30 years in prison, while transporting child pornography carries a mandatory minimum sentence of five years and a maximum of 20 years in prison, and possessing child pornography carries a maximum of 10 years in prison and up to 20 years in prison for an offense involving a minor under 12 years of age. Each count carries a $250,000 maximum fine. If convicted, the Court must impose a reasonable sentence under federal sentencing statutes and the advisory United States Sentencing Guidelines.
The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
The indictment and arrest were announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois, and Michael Anderson, Special Agent-in-Charge of the Chicago Office of Federal Bureau of Investigation.
The government is represented by Assistant U.S. Attorney Margaret J. Schneider.
Indictment
Local Music Volunteer Convicted of Production of Child PornographyRead the Press Release
ALEXANDRIA, Va. – David Alexander Battle II, 24, who served as a volunteer with the music program at Grace E. Metz Middle School in Manassas, was convicted today by a federal jury on four counts of production of child pornography, attempted coercion and enticement of a minor, receipt of child pornography, and distribution of child pornography.
Battle was arrested by the Manassas City Police Department on June 16, 2015, after law enforcement executed a search warrant at his residence and discovered evidence of child pornography, including two gigabytes of videos that appeared to be child pornography involving infants. Other evidence found at Battle’s residence included child pornography primarily of young boys and girls.
Battle was initially charged on Aug. 6, 2015, and was charged by superseding indictment on Feb. 11, 2016. According to court records and evidence at trial, an Internet Protocol address linked to Battle was used to share child sexual exploitation via webcam on a chat website in April 2015. Battle also posed as a minor girl on another chat platform and chatted with minor boys, coercing and enticing them to send him sexually explicit images of themselves, according to evidence presented at trial. The evidence demonstrated that the defendant personally knew two of the boys he chatted with on this platform.
Battle faces a mandatory minimum penalty of 15 years in prison when sentenced on June 10, 2016. The statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Leslie R. Caldwell, Assistant Attorney General of the Justice Department’s Criminal Division; Douglas W. Keen, Manassas City Chief of Police; and Clark E. Settles, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Washington, made the announcement after the verdict was accepted by U.S. District Judge Claude M. Hilton. Assistant U.S. Attorney Jay Prabhu and Special Assistant U.S. Attorney Lauren Britsch are prosecuting the case. The Herndon Police Department and the Northern Virginia/Washington, D.C. Internet Crimes Against Children Task Force (ICAC) assisted in the investigation.
This investigation was a 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.
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-274.
Local Man Who Engaged in Sexually Explicit Conversations on Facebook Sent to PrisonRead the Press Release
McALLEN, Texas – A 61-year-old man has been ordered to prison following his conviction of one count of receipt of child pornography, announced U.S. Attorney Kenneth Magidson. Dennis Ray Frank, of Edcouch, admitted he engaged in inappropriate conversations with a minor female and received a sexually graphic image via email on Nov. 30, 2015.
Today, U.S. District Judge Randy Crane took into consideration the familial relationship and position of trust that Frank held over the minor and handed the defendant a sentence of 156 months in federal prison. Additional information was also presented today, including testimony from an FBI special agent who was able to describe the graphic nature of the sexually explicit conversations involved. Through the use of the Facebook messaging system, Frank chatted with the minor victim for more than two months and discussed topics which included the performance of sexual acts. The Facebook chat messages eventually escalated to discussions regarding plans to have sex with the minor victim during a visit to the Nudist Resort where Frank resided. Testimony also established that Frank engaged the minor victim on web-camera devices in which, on one particular occasion, the defendant masturbated within view of the camera.
Frank was further ordered to pay restitution to the victim in the amount of $2,520 for counseling services and will serve the remainder of his life on supervised release following completion of his prison term. During that time, he will have to comply with numerous requirements designed to restrict his access to children and the Internet. He will also be ordered to register as a sex offender.
On Feb. 7, 2013, FBI agents received information from the National Center for Missing and Exploited Children that indicated a young female could be a potential victim of sexual exploitation. Law enforcement soon uncovered the fact that Frank had engaged the minor female child in sexually explicit conversations on Facebook. Upon further investigation, it was determined that Frank had enticed the minor female child to send sexually graphic images of her genitalia to him via email.
Law enforcement executed a search warrant on Frank’s email account, at which time they discovered the image that depicted the minor child’s genitalia. Frank admitted to receiving the child pornography image via his email account on Nov. 5, 2012. He further admitted he had been engaging in those inappropriate conversations and that the young girl had sent him the image.
Frank will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The charges are the result of an investigation conducted by the FBI.
This case, prosecuted by Assistant U.S. Attorneys Alex Benavides and Kimberly Ann Leo, was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Leesburg Man Sentenced for Embezzling $2.9 MillionRead the Press Release
ALEXANDRIA, Va. – Victor R. DeAnthony, Jr., 47, of Leesburg, was sentenced today to 36 months in prison for wire fraud for embezzling over $2.9 million from a business based in Herndon. DeAnthony was also ordered to pay $2,902,868 in restitution and forfeiture as well as serve three years of supervised release.
DeAnthony, pleaded guilty on Dec. 22, 2015. According to court documents, DeAnthony admitted to stealing $2,902,868 from Insequence, Inc., a systems engineering and integration company headquartered in Herndon, where he served as president until his termination in 2013. From 2004 through 2013, DeAnthony used corporate funds to make personal purchases and paid himself additional salary and bonus without approval. For instance, DeAnthony caused approximately $556,000 to be paid from Insequence’s corporate bank account to his mortgage lender to pay his monthly mortgage. DeAnthony used the embezzled funds to, among other things, purchase real estate, an automobile, personal watercraft, and a recreational vehicle.
According to court records, in order to conceal the fraud DeAnthony made false entries into the company’s accounting software. For example, in January 2012, DeAnthony wire transferred $59,612.83 from Insequence’s bank account to a title company in order to pay for expenses related to the sale of his personal residence in Leesburg. Later, in accounting records, DeAnthony falsely represented the transaction as a corporate “Facilities: Moving Expense.” Moreover, in May 2012, DeAnthony wire transferred $38,241.62 from Insequence to an account belonging to a law firm in South Carolina that assisted DeAnthony with a personal real estate purchase. In order to disguise the payment, DeAnthony falsely identified the payee as a northern Virginia law firm that the company had hired to negotiate a corporate income tax issue.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after sentencing by U.S. District Judge James C. Cacheris. Assistant U.S. Attorney Uzo Asonye 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-364.
Lawrence Man Sentenced to Prison for Heroin TraffickingRead the Press Release
BOSTON – A Lawrence man was sentenced yesterday in U.S. District Court in Boston for trafficking heroin in Haverhill.
Jonathan Santiago, 31, was sentenced by U.S. District Court Chief Judge Patti B. Saris to two years in prison and three years of supervised release. In December 2015, Santiago pleaded guilty to possessing with intent to distribute and distributing heroin.
On three occasions, between Nov. 19 and Dec. 1, 2014, Santiago sold drugs to a cooperating witness in Haverhill. Santiago sold a combined 18.3 grams of heroin in the first and second sales. On the third occasion, he sold 17.8 grams of fentanyl. Fentanyl is similar to heroin and morphine, but 30-50 times more powerful. When taken in the same dosage as heroin, fentanyl can cause overdose or death.
The case is part of Operation Zero Tolerance, a joint federal and state investigation of gang-related criminal activity in and around Haverhill focusing particularly on opiate-related drug overdoses. As part of the investigation, law enforcement identified Santiago as an associate of Haverhill gang members.
This case was prosecuted as part of the federal response to New England’s opioid crisis. In 2014, the year in which Santiago was dealing heroin and fentanyl, more than 1,000 people in Massachusetts died of opiate overdoses. In fact, since 2005, more Massachusetts residents have been killed by opiate-related overdoses than in car accidents.
United States Attorney Carmen M. Ortiz; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and Haverhill Police Chief Alan R. DeNaro, made the announcement today. The case was prosecuted by Assistant U.S. Attorney Timothy E. Moran of Ortiz’s Narcotics and Money Laundering Unit.
Kingsville Man Heads to Prison for Possessing Child PornographyRead the Press Release
CORPUS CHRISTI, Texas – Robert Wayne Collins, 63, has been ordered to federal prison following his conviction on one count of possession of child pornography, announced U.S. Attorney Kenneth Magidson. Collins, of Kingsville, pleaded guilty Dec. 1, 2015.
Today, U.S. District Judge Nelva Gonzales Ramos handed Collins a sentence of 84 months. Collins was further ordered to pay a $17,500 fine five years of supervised release following completion of his prison term, during which time he will have to comply with numerous requirements designed to restrict his access to children and the Internet. He will also be ordered to register as a sex offender.
At the time of his plea, the court heard that authorities, while using peer-to-peer software, were able to successfully download of various files containing child pornography from an IP address that was associated with Collins.
In January 2015, agents executed a search warrant at Collin’s residence, at which time they seized various electronic devices. Forensic analysis on those devices revealed more than 90 images and approximately 160 videos of child pornography. Collins admitted to using the peer-to-peer software to download child pornography.
Collins was arrested on a bond revocation warrant in November 2015 and has been in custody since that time where he will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
Homeland Security Investigations investigated with the assistance of the Corpus Christi Police Department—Internet Crimes Against Children Task Force.
This case, prosecuted by Assistant U.S. Attorney Hugo R. Martinez, was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Kenner Woman and Construction Company Plead Guilty to Labor Violations and False StatementsRead the Press Release
U.S. Attorney Kenneth A. Polite announced that KATIA MURILLO COSTA, age 42, of Kenner, pled guilty today to violating provisions of the Fair Labor Standards Act. Her company, KLV OPERATIONS LLC (“KLV”), also pled guilty to violating the Fair Labor Standards Act and to having representatives make false statements to federal agents.
According to court documents, in November 2013, the U.S. Department of Labor (“DOL”), a department or agency of the United States, began investigating whether KLV was paying its employees proper overtime and minimum wage pay in compliance with the Fair Labor Standards Act. The investigation disclosed that the defendants, KLV and COSTA, failed to pay 47 employees overtime and minimum wage. In addition, representatives of KLV submitted materially false and fraudulent payroll and timesheet records to the DOL, in an effort to make representatives of the DOL believe that KLV was complying with the Fair Labor Standards Act.
COSTA faces a possible penalty of up to six months imprisonment, a fine of up to $10,000, restitution in the amount of approximately $58,679.71, and a special assessment of $25. KLV faces a possible fine of up to $500,000, restitution of approximately $58,679.71, and a special assessment of $400. U.S. District Judge Jane Triche Milazzo set sentencing for June 9, 2016.
U.S. Attorney Polite praised the work of Investigators with the DOL, and Special Agents with the DOL, Office of Inspector General in investigating this matter. Assistant U. S. Attorney Sharan E. Lieberman is in charge of the prosecution.
Joshua Hayworth Sentenced to More Than 16 Years in Prison for Hobbs Act Robbery and CarjackingRead the Press Release
KNOXVILLE, Tenn. – Joshua Hayworth, 25, of Loudon, Tenn., was sentenced on March 10, 2016, by the Honorable Thomas A. Varlan, U.S. District Court Chief Judge, to serve 200 months in federal prison.
After a jury trial in July 2015, Hayworth was convicted of a Hobbs Act robbery at the Burger King located on Simpson Road in Lenoir City, Tenn., which occurred on Jan. 30, 2014, and a carjacking in Knoxville, Tenn., which occurred on Feb. 3, 2014. The trial evidence showed that during the Burger King robbery, Hayworth brandished an airsoft pistol and, while pointing the pistol at the employees, ordered them to fill up a bag with money from the safe. His co-defendant, Timothy Chudley, was employed at the Burger King and, unbeknownst to his co-workers, was in on the robbery. During the commission of the robbery, Hayworth hit Chudley in the head with his pistol, causing Chudley to bleed. Hayworth fled the Burger King in a vehicle that he wrecked less than one mile from the Burger King. He left the accident scene before law enforcement arrived, but the trial evidence revealed that the vehicle contained: the pistol used during the robbery; the robber’s mask, which contained Hayworth’s DNA; Hayworth’s identification card; and prescription medication in Hayworth’s name. Cash from the robbery was also recovered from within the wrecked vehicle and all over the highway. Finally, Hayworth’s cellular telephone, which contained text messages to and from Chudley that showed their planning of the robbery, was also recovered.
Although law enforcement searched for Hayworth, he was not found on the night of the Burger King robbery. Trial evidence revealed that four days after the Burger King robbery, Hayworth carjacked a pregnant woman in Knoxville, Tenn., who was less than one week away from delivering her baby. After he violently wrestled the keys away from her, the pregnant victim had to endure an agonizing wait for an ambulance as she feared that her full-term baby, who was not moving, was dead. Upon arriving at the hospital, it was discovered that the baby was, in fact, healthy.
Agencies involved in this investigation include the Federal Bureau of Investigation (FBI) Safe Streets Task Force, which is made up of agents with the FBI and officers from the Knoxville Police Department and Knox County Sheriff’s Office; Knoxville Police Department; Knox County Sheriff’s Office Major Crimes Unit; Loudon County Sheriff’s Office, and Lenoir City Police Department. Assistant U.S. Attorneys Kelly A. Norris and Cynthia F. Davidson represented the United States.
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Jacksonville Man Sentenced to Federal Prison for Aggravated Identity TheftRead the Press Release
Jacksonville, Florida – United States District Judge Timothy J. Corrigan has sentenced Travis Ware (24, Jacksonville) to two years in federal prison for his role in an identity theft and counterfeit check scheme. He pleaded guilty on November 12, 2015.
According to court documents, on November 23, 2014, troopers with the Florida Highway Patrol pulled over a vehicle occupied by Ware and co-defendants David Lee Mitchell and Hezekiah Williams. During the traffic stop, the troopers observed marijuana inside the SUV. A search of the vehicle revealed 25 counterfeit business checks made out to various individuals and 15 forms of identification from 7 different people. Many of the names on the identification documents matched those printed on the counterfeit checks. Further investigation determined that Ware, Mitchell, and Williams had been driving around three days earlier attempting to fraudulently cash the counterfeit checks and recruiting others to use the ids to cash the checks.
On October 2, 2015, Mitchell and Williams pleaded guilty to attempted bank fraud, possession of counterfeit business checks, and aggravated identity theft. They remain in federal custody pending a sentencing date.
This case was investigated by the Florida Highway Patrol and the United States Secret Service, Jacksonville Field Office. It was prosecuted by Assistant United States Attorney Kevin C. Frein.
Fumigation Company and Two Individuals Pled Guilty in Connection with Illegal Pesticide Application Resulting in Injuries to a MinorRead the Press Release
Sunland Pest Control Services, Inc. (Sunland), Grenale Williams, 53, of South Bay, and Canarie Deon Curry, 40, of Riviera Beach, pled guilty today in federal court in Fort Pierce before United States District Court Judge Jose E. Martinez in connection with the illegal application of a pesticide that resulted in injuries to a minor child.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Andy Castro, Acting Special Agent in Charge, United States Environmental Protection Agency (EPA), Criminal Investigation Division, Atlanta Area Office, made the announcement.
Sunland, Williams, and Curry, pled guilty for their involvement in the illegal application of sulfuryl fluoride (a pesticide), contrary to the label’s safety requirements, in violation of Title 7, United States Code, Section 136i(b)(1)(B). Sunland also pled guilty to making false statements in connection with the investigation, in violation of Title 18, United States Code, Section 1001. Williams and Curry face a statutory maximum sentence of up to one year in prison and a fine of up to $100,000, to be followed by and a period of supervised release. In addition, Sunland faces up to five years of probation and a $500,000 fine for the false statements conviction. Sentencing is scheduled for May 11, 2016 at 12:00 p.m. in Fort Pierce.
According to court documents, the federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) regulates the use of pesticides, including those designated for restricted use due to their potential adverse effects, including serious injury. Application of restricted use pesticides is limited to certified applicators or those under the direct supervision of certified applicators. Sulfuryl fluoride, a commonly used antimicrobial in structural fumigations for termites, is one such restricted use pesticide that is registered with the EPA. At the heart of the safe use of such pesticides is compliance with the product label, which includes the written, printed, or graphic matter associated with the pesticide. Under FIFRA, the label is the law, and strict compliance with it is critical to the safe application of the restricted use pesticide. Federal law also prohibits the making of material false statements in a matter within the jurisdiction of the EPA.
Court records and a joint factual statement indicate that in June 2015 residents contracted with Terminix for a home fumigation for termites under an existing warranty. Terminix, without warning or approval, subcontracted the job to Sunland. The fumigation occurred over a weekend and the residents returned to their home on Sunday, August 16, 2015 to find a clearance tag on the front door indicating that it was safe to enter. During the evening several family members became ill, and medical attention was sought for their nine year old son. It was determined that the family’s symptoms were consistent with pesticide poisoning.
A subsequent investigation revealed that contrary to the label requirements for use of the potentially deadly gas, the defendants failed, among other violations, to: provide the Fact Sheet for the pesticide being used; have the required number of properly trained personnel on site following the application of the pesticide; properly aerate the fumigated space; and conduct clearance testing with an approved and calibrated Low Fumigant Level Detection Device. In addition, a clearance tag was left at the premises indicating it was safe to enter when in fact the requisite procedures had not been completed. The family was falsely assured by Terminix and Sunland that the aeration and clearance requirements had been met. Additionally, Sunland representatives misrepresented the specific brand of pesticide that was used and indicated that the fumigation, aeration, and clearance of the home was in accordance with the law when in truth and fact, the defendants were not in compliance.
United States Attorney Wifredo A. Ferrer stated, “Federal regulations are in place to ensure that the public is protected. Individuals and corporations who knowingly side-step the safety protocols that have been instituted expose others to potentially dangerous consequences. The U.S. Attorney’s Office will continue to work with our law enforcement partners to hold those accountable who violate the law.”
“The preventable toxic poisoning of a young boy is a stark reminder of why pesticides must be used properly and responsibly,” said Andy Castro, Acting Special Agent in Charge of EPA’s criminal enforcement program in Florida. “EPA’s investigation revealed numerous FIFRA violations before, during, and after the defendants’ fumigated the victims’ home. These charges demonstrate that those who knowingly misuse pesticide products threaten the most vulnerable among us, and can expect to be prosecuted.”
Mr. Ferrer commended the investigative efforts of the EPA, the Florida Department of Agriculture and Consumer Services, Bureau of Pesticide and Incident Response, and the Florida Office of Agricultural Law Enforcement. The case was prosecuted by Special Assistant U.S. Attorney Jodi A. Mazer and Assistant U.S. Attorney Thomas Watts-FitzGerald of the Economic & Environmental Crimes Section.
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.
Fugitive Captured After Shootout with U.S. Marshals and New York City Detectives Convicted of Assault with A Deadly Weapon and Related Firearms OffensesRead the Press Release
Late this afternoon, following four days of trial, a federal jury in Brooklyn, New York, returned a guilty verdict against Oswald Lewis, on charges of assault of federal agents and New York City Detectives by use of a deadly weapon and related firearms offenses. Lewis, also known as “Alexander Louis,” “Junior,” “Andrew Jackson,” “Andre Bernard Jackson,” “John Green,” “Leslie Howard” and “Dre,” faces a maximum sentence of life imprisonment when sentenced on June 23, 2016, by United States District Judge I. Leo Glasser.
The verdict was announced by Robert L. Capers, United States Attorney for the Eastern District of New York; Charles G. Dunne, United States Marshal for the Eastern District of New York; William J. Bratton, Commissioner, New York City Police Department; and Delano A. Reid, Special Agent-in-Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives, New York Field Division.
Lewis had been wanted since 1991 on numerous drug charges filed in the United States District Court for the Eastern District of Virginia. On August 26, 2014, the U.S. Marshals Service located Lewis in an apartment in the Springfield Gardens section of Queens, New York. Later that evening, Deputy U.S. Marshals and New York City Police Department Detectives went to the apartment to arrest him. When the Deputies entered the apartment, Lewis, who was wearing body armor, yelled that he was holding a hostage and began shooting, barely missing at least one Deputy by mere inches. During the shooting spree, Lewis fired shots out his apartment window at members of the NYPD, who had surrounded the premises. During the exchange of gunfire, Lewis was shot in the arm. He eventually surrendered and was taken into custody. No law enforcement officers were injured.
“These dedicated Deputy U.S. Marshals and NYPD Detectives put their lives on the line every day to protect us from violent criminals such as the defendant Oswald Lewis. His life on the run ended today, and our community is safer for it,” stated Unites States Attorney Capers.”
“Today, US Marshals around the country paused for a moment of silence to remember Deputy US Marshal Josie Wells who was shot and killed by an armed fugitive while serving a warrant in Louisiana one year ago today. The circumstances of the two incidents are similar – a violent fugitive armed with an illegal handgun shooting at law enforcement officers who came to bring him to justice. We are very fortunate that the arrest in New York ended with only minor injuries to Mr. Lewis and no injuries to the law enforcement officers involved. The US Marshals would like to thank the United States Attorney’s Office for the Eastern District of New York for prosecuting Mr. Lewis, and we would like to thank the New York City Police Department for their continued partnership as we work together to keep New York City safe,” stated United States Marshal Dunne.
“ATF Special Agent in Charge Reid stated, “With today’s swift verdict, the defendant will now begin to realize that law enforcement and the criminal justice system remain vigilant and relentless in their pursuit of those who decide to run from their crimes. Finally, Mr. Lewis will face the punishment he has successfully avoided for so many years and hopefully will learn that fugitives - especially those that decide to shoot at law enforcement instead of surrendering - have but one place in society: a jail cell.”
The government’s case is being prosecuted by Special Assistant United States Attorney Jonathan P. Lax.
The Defendant:
OSWALD LEWIS
Age: 44
Queens, New YorkE.D.N.Y. Docket No. 14-CR-523 (ILG)
Founders of Film School for Wounded Veterans Sentenced to PrisonRead the Press Release
Assistant U.S. Attorneys Eric J. Beste (619-546-6695) and Rebecca S. Kanter (619-546-7304)
NEWS RELEASE SUMMARY – March 10, 2016
SAN DIEGO – Judith Paixao and Kevin Lombard, a husband and wife who embezzled federal funds from the Wounded Marine Careers Foundation that were intended to provide job training, benefits and equipment for injured Marines returning from Iraq and Afghanistan were sentenced today, following a July 2015 jury trial.
Paixao was sentenced to six months’ custody and six months’ home confinement; her husband, Lombard, was sentenced to three months’ custody followed by three months’ home confinement. In addition to these custodial sentences, the Court ordered the defendants to pay $150,000 in financial penalties and restitution.
At the hearing, Judge Jeffrey T. Miller, the district court judge who presided over the trial and imposed the sentences, denied the defendants motion for a new trial or judgment of acquittal. In doing so, Judge Miller observed that “whatever commendable vision served to launch the Foundation, that idealism spawned theft, embezzlement and worse.” He noted that there were several “tells,” i.e. facts which created the “lens through which the jury viewed the evidence in this case.” These “tells” included their continuous misrepresentations of donating hundreds of thousands of dollars to the Foundation from the sale of their home, which they actually had lost to foreclosure. Another “tell” related to the defendants’ misrepresentations regarding high-end video cameras acquired by the Foundation and billed to the Department of Veterans Affairs (“VA”) at “bogus” inflated costs.
From 2007-2009, Paixao and Lombard were directors of the Wounded Marine Careers Foundation (“the Foundation”), a tax-exempt entity that trained injured veterans for careers in the film industry. They used the Foundation to defraud the VA and submit false claims to the VA in order to get funds for training and equipment they never provided. Adding insult to injury, the defendants also embezzled funds from the Foundation for their own use.
As detailed in their trial, the defendants made numerous false and misleading statements to the VA in order to obtain funds for training and equipment, and then did not provide all the training or equipment to the veterans. Although the defendants claimed to have donated over $200,000 to start the Foundation, they ended up taking over $400,000 from the Foundation’s accounts over the course of two years.
Rather than paying the Foundation’s creditors (some of whom were members of the Foundation’s Board of Directors), the defendants transferred funds to their own personal credit cards and bank accounts. Although some of this money went to repay expenses they had fronted to the Foundation, evidence presented at trial showed that the defendants ended up taking over $100,000 for themselves. The defendants then used these funds to pay for a variety of personal expenses, including a family vacation in Bermuda; cell phone bills, car insurance and gifts for their family members; prescription medications and counseling costs; wine and dinners for two; and the costs of a New Year’s Day sailing trip around San Diego Bay.
U.S. Attorney Laura Duffy emphasized that “the fraud committed by these defendants - who used money set aside to help wounded veterans and spent it on themselves - was particularly offensive. These defendants capitalized on the misfortune of wounded marines in their time of vulnerability and took advantage of the VA’s commitment to serving wounded veterans to defraud the VA and enrich themselves. War profiteering which takes advantage of our veterans is not in any way, shape or form acceptable.”
The defendants routinely commingled the finances of the Foundation with their personal finances, thereby obstructing the ability of the Internal Revenue Service to monitor the Foundation’s tax-exempt status and determine the defendants’ personal income tax liability.
Among the witnesses who testified at trial were three of the injured veterans who used their vocational rehabilitation benefits to participate in the first training class: Gunnery Sergeant Nick Popaditch and Lance Corporal Joshua Frey. Lance Corporal Frey, who had previously been quoted in a favorable New York Times article, testified at trial that after the article was published the defendants did not give him all the equipment he was promised, and failed to provide him with certain training and job placement.
The trial evidence also showed that Defendant Paixao defrauded the Bob Woodruff Foundation in connection with a restricted grant of almost $100,000 by concealing the fact that one of the intended recipients – a Marine who had been injured in Fallujah – had left the program. Instead of notifying the Bob Woodruff Foundation and asking for a reallocation of the funds, Ms. Paixao took the grant money and used it for other purposes.
In explaining the reason for imposing custodial sentences well below the advisory sentencing guideline range, Judge Miller identified the unique characteristics of each defendant, including their extraordinary community support (including from many members of the military), the low risk of recidivism, and the court’s assessment that the defendants “began with a vision or goal that was worthy” when they first reached out to wounded Marines. Despite these mitigating factors, the Court observed that the defendants “deserved to be prosecuted,” and this case served as important deterrent against those who would be tempted to victimize charitable institutions, their donors or their beneficiaries.
Douglas J. Carver, Special Agent in Charge, VA OIG Western Region stated, “Fraud schemes capitalizing on the misfortune of wounded veterans are particularly egregious. The VA Office of Inspector General will continue to vigorously pursue those who defraud veterans and the Government for personal gain. It is our hope that the successful investigative and prosecutive efforts in this case will serve as a deterrent to others from engaging in criminal activity that cheats veterans and the VA programs designed to assist our nation’s heroes.”
“Today’s sentencing of Kevin Lombard and Judith Paixao sends a clear message that fraud against our veterans will not be tolerated. These veterans endured many sacrifices to protect our country from harm,” stated IRS Criminal Investigation Acting Special Agent in Charge Anthony J. Orlando. He further added, “IRS Criminal Investigation, in conjunction with our law enforcement partners, is committed to identifying, investigating, and prosecuting individuals who engage in fraud and deceit, and exploit programs designed to benefit others to satisfy their greed.”
DEFENDANTS
Case Number: 13cr3788-JM
Judith Ann Paixao
Age: 61
Afton, Virginia
Kevin Lombard
Age: 64
Afton, Virginia
CHARGES
Count 1: Conspiracy to defraud the United States and commit the offenses (18 U.S.C. § 371).
Guilty as to both defendantsCounts 2-9: Theft from an organization receiving federal funds (18 U.S.C. § 666(a)(1)).
Defendant Paixao: Guilty as to all counts
Defendant Lombard: Guilty on counts 2-4, 6-10Counts 10-12: False claims (18 U.S.C. § 287)
Guilty as to all counts for both defendantsCount 13: Mail fraud (18 U.S.C. § 1341)
Defendant Paixao: GuiltySENTENCES
PAIXAO – 6 months’ custody on all counts, 2 years’ supervised release with a condition of 6 months’ home confinement on all counts, concurrent; $1,300 special assessment; $75,956 restitution ($54,688 to VA and $21,268 to Bob Woodruff Foundation); $76,873 forfeiture
LOMBARD – 3 months’ custody on all counts, 2 years’ supervised release with a condition of 3 months’ home confinement on all counts, concurrent; $1,100 special assessment; $54,688 restitution to VA; $70,873 forfeiture
INVESTIGATING AGENCIES
Department of Veterans Affairs, Office of Inspector General
Internal Revenue Service, Criminal InvestigationFormer Wilmington Housing Authority Employee Sentenced to 12 Months in Prison for EmbezzlementRead the Press Release
WILMINGTON, Del. - Charles M. Oberly, III, United States Attorney for the District of Delaware, announced that Damien Piper, age 34, of Wilmington, Delaware, was sentenced today by the Honorable Gregory M. Sleet, United States District Judge for the District of Delaware, to 12 months and one day in prison, and full restitution. The defendant pleaded guilty to Theft of Public Funds, in October 2015.
According to court filings and statements made in court, the defendant was an Assistant Site Manager for the Wilmington Housing Authority’s Crestview Apartments. In February 2012, he began converting residents’ rental payments to his personal use. Residents often paid their rent by money order. Piper received and altered the money orders, making them payable to himself. Piper deposited the money orders into bank accounts he owned and controlled, and he cashed some of the money orders at check cashing businesses.
From February 10, 2012, and continuing up to and including October 7, 2014, Piper took more than 700 money orders that were designated for the Housing Authority, and he obtained at least $179,000. Piper altered the Housing Authority’s computerized records to conceal the converted payments as “adjustments.” These altered Housing Authority records indicated that less rent was due from the residents. In fact, Piper collected the full amount of rent from the residents and kept the “adjustment” amount for himself.
Judge Sleet stated, among other things, that “the impact on the Housing Authority was real and apparent, if not devastating,” and the defendant “damaged the reputation of the Agency for his own enrichment.”
U.S. Attorney Oberly commented, “The theft of money from those who pay rent to the Wilmington Housing Authority is particularly despicable, and the prosecution of Mr. Piper was warranted. I thank all those involved that helped bring this matter to a successful conclusion.”
This case is the result of an investigation conducted by the U.S. Department of Housing & Urban Development, Office of Inspector General, and the United States Postal Inspection Service. The case is being prosecuted by Assistant United States Attorney Lauren Paxton.
Former Stuart Youth Pastor Pleads Guilty to Production and Distribution of Child PornographyRead the Press Release
Today, a former youth pastor pleaded guilty to the production and distribution of child pornography before Chief Magistrate Judge Frank J. Lynch, Jr., in Fort Pierce, Florida.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and William Snyder, Sheriff, Martin County Sheriff’s Office (MCSO), made the announcement.
Jeffrey Brian Mobley, 24 of Ocala, formerly of Stuart, Florida pleaded guilty to an indictment, charging four counts of production of visual depictions of sexual exploitation of minors, in violation of Title 18, United States Code, Sections 2251(a) and (e) and two counts of distribution of visual depictions of sexual exploitation of minors, in violation of Title 18, United States Code, Sections 2252(a)(2) and (b)(1). Mobley faces a mandatory minimum of 15 to 30 years’ imprisonment for the production counts and a mandatory minimum of 5 to 20 years’ imprisonment for the distribution offenses. Mobley is scheduled to be sentenced by U.S. District Judge Jose E. Martinez on May 9, 2016 at 1:30 p.m.
According to the court record, in September 2015, a suspicious conduct report was made to the Martin County Sheriff’s Office concerning a youth pastor, Jeffrey Brian Mobley, and a minor who was under his trust and care through a religious based youth program in Stuart, Florida. During the course of the investigation law enforcement learned that Mobley, while the youth pastor, engaged in sexual intercourse with a minor who was a participant in the church’s youth program. Using various forms of electronic communication, Mobley induced the minor to engage in sexual activity and produced sexually explicit images of their illicit relationship.
This case was brought as part of Project Safe Childhood (PSC), 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 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 the Project Safe Childhood initiative and for information regarding Internet safety, please visit www.justice.gov/psc.
Mr. Ferrer commended the investigative efforts of the FBI and Martin County Sheriff’s Office for their work on this case. Mr. Ferrer also thanked the members of the United States Attorney’s Office for the Middle District of Florida for their assistance with this matter. The case was prosecuted by Assistant U.S. Attorney Carmen Lineberger.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Former Seminole County High School Teacher Sentenced to 27 Years on Federal Child Exploitation ChargesRead the Press Release
Orlando, Florida – U.S. District Judge Paul G. Byron has sentenced Gregory A. Vaughn (59, Seminole County) to 27 years in federal prison for enticement of a minor and production of child pornography. He received a concurrent sentence of 20 years' imprisonment for receiving child pornography. Vaughn must serve a life term of supervision following his release and register as a sex offender. The Court also ordered Vaughn to pay $7,500 in restitution.
According to court records, during a span of two years, Vaughn groomed and persuaded a minor to produce and send him explicit images. He informed the girl that he wanted to pay for the pictures, and he structured a pay chart for the types of photos she should take and send to him. Vaughn mailed the girl money, books, candy, clothes, underwear, and makeup in exchange for the pictures she had sent to him.
Vaughn’s cellphone and computer were searched pursuant to a state search warrant and agents were able to recover images of the victim and other children from his computer. Agents also interviewed another victim, who also had been groomed and enticed into producing child pornography by Vaughn.
This case was investigated by the Federal Bureau of Investigation. It was prosecuted by Assistant United States Attorney Ilianys Rivera Miranda.
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 (CEOS), 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.
Former Niagara Falls Businessman Sentenced for Bank FraudRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
BUFFALO, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that Timothy DePetris, 46, of Niagara Falls, NY, who was convicted of bank fraud, was sentenced to 27 months in prison by Senior U.S. District Judge William M. Skretny. The defendant was also ordered to pay restitution to M&T Bank totaling $177,509.32.Assistant U.S. Attorney MaryEllen Kresse, who handled the case, stated that the defendant, as owner of Electro-Dyn Choke Corporation in Niagara Falls, caused payroll checks to be issued to him and another individual and negotiated the payroll checks even though he knew there were insufficient funds in corporation’s account at M&T Bank to cover the checks. As a result of the defendant’s conduct, M&T Bank suffered a loss of $177,509.32.
The sentencing is the culmination of an investigation by Special Agents of the Federal Bureau of Investigation, under the direction of Special Agent in Charge Adam S. Cohen.
Former Healthcare Employee Indicted for Involvement in Stolen Identity Tax Refund Fraud Scheme and Unauthorized Disclosure of Patient InformationRead the Press Release
A Montgomery, Alabama resident self-surrendered earlier today after she was indicted March 3 on one count of multi-object conspiracy to commit identity theft and wire fraud, two counts of possessing 15 or more unauthorized access devices, two counts of aggravated identity theft and one count of wrongful disclosure of personally identifiable health information, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney George L. Beck Jr., of the Middle District of Alabama.
According to court documents, Alana Wells worked at a healthcare company from June 2011 through August 2013, where she had access to patient information protected from disclosure under the Health Insurance Portability and Accountability Act of 1996. She is alleged to have stolen the names, dates of birth and social security numbers of patients from her employer’s database and provided these identities to Fredrick Hill. Hill then provided the stolen personal identification information to Christopher Davis, who, along with others, used it to file fraudulent federal tax returns with the Internal Revenue Service (IRS) requesting tax refunds.
If convicted, Wells faces a statutory maximum sentence of five years in prison on the conspiracy charge, 10 years in prison for each count of access device fraud, one year in prison for the charge of wrongful disclosure of personally identifiable health information, and a mandatory minimum sentence of two years in prison for each count of aggravated identity theft, which will be in addition to any other term of imprisonment she receives. She also faces substantial monetary penalties and restitution.
An indictment merely alleges that crimes have been committed. Defendants are presumed innocent until proven guilty beyond a reasonable doubt.
Acting Assistant Attorney General Ciraolo and U.S. Attorney Beck commended special agents of IRS-Criminal Investigation, who investigated the case and Trial Attorneys Jason H. Poole, Kathryn A. Kimball and Michael C. Boteler of the Tax Division and Assistant U.S. Attorney Jonathan S. Ross of the Middle District of Alabama, who are prosecuting this case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Former East Haven Zoning Official Who Solicited and Received Payments from Residents is SentencedRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that FRANK BIANCUR, JR., 41, of West Haven, was sentenced yesterday by U.S. District Judge Victor A. Bolden in Bridgeport to 30 days of incarceration in a halfway house, followed by two years of supervised release, for seeking and receiving illegal payments while employed as a Zoning Enforcement Officer for the Town of East Haven. During his term of supervised release, BIANCUR must spend six months in home confinement with electronic monitoring and perform 200 hours of community service.
According to court documents and statements made in court, BIANCUR was employed as the Town of East Haven’s Planning and Zoning Administrator/Zoning Enforcement Officer. In pleading guilty, BIANCUR admitted that he sought and received payments from at least five individuals in exchange for official acts he rendered as the Zoning Enforcement Officer.
In May 2015, a resident of East Haven contacted the East Haven Police Department and the FBI with information that he/she had been extorted by BIANCUR since approximately October 2012 and, as a result, had made cash payments to BIANCUR. On May 19, 2015, BIANCUR called the victim and informed the victim that BIANCUR had to inspect an addition to the victim’s residence. Although BIANCUR stated that he was “fighting” for the victim, he also required a payment of $200 or he would make the victim tear down the addition. On May 21, 2015, the victim engaged in a consensually-recorded meeting with BIANCUR at BIANCUR’s office in East Haven Town Hall. During the meeting, the victim gave BIANCUR $200 in cash, which BIANCUR put in his pocket.
BIANCUR also has admitted that he sought and received $500 cash payments from two additional East Haven residents in order to resolve zoning violations.
BIANCUR was ordered to pay $6,265 in restitution.
BIANCUR was arrested on May 27, 2015. On December 1, 2015, he pleaded guilty to one count of theft of honest services mail fraud.
Prior to his employment by the Town of East Haven, BIANCUR was employed by the City of West Haven and the City of Bridgeport.
This matter was investigated by the Connecticut Public Corruption Task Force and the East Haven Police Department. The case was prosecuted by Assistant U.S. Attorney Christopher W. Schmeisser.
The Connecticut Public Corruption Task Force includes the Federal Bureau of Investigation, Internal Revenue Service – Criminal Investigation Division, U.S. Postal Inspection Service, U.S. Department of Housing and Urban Development – Office of Inspector General and U.S. Department of Health and Human Services – Office of Inspector General. Citizens are encouraged to report corruption to the Task Force by calling 203-238-0505.
Former CEO of Long Island’s Synergy Brands, Inc. Sentenced to 63 Months in Prison for Operating A Massive Check Kiting SchemeRead the Press Release
Earlier today in Brooklyn federal court, Mair Faibish, the former Chief Executive Officer of Synergy Brands, Inc. (Synergy), was sentenced to 63 months’ imprisonment for his role in defrauding Signature Bank out of $26 million through a massive check kiting scheme, making false statements to the United States Securities and Exchange Commission (SEC), and defrauding investors by overstating the value of the company. The sentencing proceeding was held before U.S. District Judge Eric N. Vitaliano. Faibish was convicted after a three-week jury trial in March 2014.
The sentence was announced by Robert L. Capers, United States Attorney for the Eastern District of New York.
“The defendant played fast and loose with the truth and with federally insured money, kiting checks back and forth across the Canadian border to defraud auditors, banks, and investors. His actions have now landed him in federal prison,” stated United States Attorney Capers. “We will aggressively investigate and prosecute those who exploit investors and banks.” Mr. Capers extended his grateful appreciation to U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), which led the government’s criminal investigation, and the Nassau County Police Department.
Synergy was a publicly-held food products company that traded on the NASDAQ and Over-the-Counter exchanges and manufactured and distributed various food products. As proven at trial, Faibish and his co-conspirators, on behalf of Synergy, funneled approximately $1.3 billion in checks that were not backed by sufficient funds through Signature Bank, Capital One Bank, and various Canadian bank accounts of associated food manufacturers and distributors in Canada. The Canadian companies then sent checks in corresponding amounts, which were also not backed by sufficient funds, back to Faibish-controlled shell companies. Because the banks made deposited funds immediately available for withdrawal, the scheme artificially inflated the companies’ account balances. Faibish and his co-conspirators used Synergy’s inflated bank account balances to book millions of dollars in fictitious accounts receivable and revenue.
As a result of this fraud, FDIC-insured Signature Bank lost approximately $26 million that Faibish and his co-conspirators had withdrawn before the bank uncovered the scheme. Following the scheme’s collapse, Synergy was taken into bankruptcy, and its publicly traded stock became essentially worthless, causing millions of dollars in investor losses. On November 4, 2014, the Court ordered Faibish to pay $51,166,000 in forfeiture.
The trial evidence also established that Faibish falsely inflated the values of Synergy’s sales, cost of goods sold, and pre-paid expenses in filings with the SEC for the quarter ending June 30, 2008. These material misrepresentations were breaches of the defendant’s fiduciary duties to investors.
This prosecution was the result of efforts by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ Offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions, and other organizations. 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, visit http://www.StopFraud.gov.
The government’s case is being prosecuted by the office’s Business and Securities Fraud Section. Assistant United States Attorneys Sylvia S. Shweder and Jack Dennehy are in charge of the prosecution. Assistant U.S. Attorney Brian D. Morris of the Office’s Civil Division is responsible for the forfeiture of assets.
The Defendant:
MAIR FAIBISH
Age: 55
Residence: Huntington Station, New YorkE.D.N.Y. Docket No. 12-CR-265 (ENV)
Federal Court Permanently Enjoins Los Angeles County Pizza Parlor and its Owner from Accruing Payroll Tax LiabilitiesRead the Press Release
LOS ANGELES – A federal judge has ordered that Evnol, Inc., which operates Palisades Pizza, and the company’s owner, Christopher H. Bandt, timely file payroll tax returns and pay payroll taxes.
In an order filed on Monday, United States District Judge Manuel L. Real entered a permanent injunction requiring Evnol and Bandt to timely file payroll tax returns and pay any payroll taxes that accrue.
According to the civil lawsuit filed by the United States, Evnol has repeatedly failed to timely file payroll tax returns or pay payroll taxes.
“Since the third quarter of 2007, Evnol has repeatedly failed to comply with its employment tax obligations despite repeated efforts by the IRS to bring it into compliance,” according to the government’s lawsuit. “Specifically, Evnol consistently failed to meet its obligations to make complete federal employment tax deposits and routinely failed to file timely employment and unemployment tax returns.”
The permanent injunction entered by the Court requires the defendants to stay current on their federal employment tax obligations.
Judge Real issued a default judgment against Evnol and Bandt, in part, because of “their refusal to participate in this litigation,” Judge Real wrote in his order.
United States Attorney Eileen M. Decker complimented the revenue officer of IRS Field Collection for investigating and preparing the civil case. “Without the hard work of the IRS and the continued flow of tax revenue, government could not function,” said United States Attorney Decker. “Now that tax season is upon us, this case is an important reminder that everyone meet their obligations and file accurate tax returns in a timely manner.”
Father and Son Indicted for String of Robberies Including Garden Oaks Post OfficeRead the Press Release
HOUSTON – Two men have been charged in a seven-count indictment for their roles in a spree of Houston-area robberies committed within the span of one week in January 2016, announced U.S. Attorney Kenneth Magidson.
Joe Robert Martinez, 40, of Houston, and his son, Joe Robert Martinez, 21, of Hockley, were indicted March 3, 2016. The elder Martinez was already in custody, but the son was arrested today. Both are expected in federal court before U.S. Magistrate Judge Frances Stacy tomorrow at 10:00 a.m.
Both are accused of conspiracy to interfere with commerce by robbery, aiding and abetting interference with commerce by robbery and aiding and abetting the use of a firearm during the commission of a crime of violence.
The elder Martinez was previously charged by complaint for the Jan. 28, 2016, armed robbery of the Garden Oaks Post Office located at 3816 North Shepherd in Houston. During the course of the investigation, law enforcement discovered additional robberies allegedly involving him and his son. Specifically, both defendants have been charged with the armed robberies of Taqueria Launica #3 at 10900 Beechnut on Jan. 21, 2016, and Timewise Foodstores #107 at 3316 Crosstimbers on Jan. 26, 2016. The elder Martinez is the only defendant charged in the Garden Oaks post office robbery.
The indictment alleges the father and son interfered with interstate commerce by robbery at each of these business locations. As part of the conspiracy, one or more co-conspirators would enter the store, display a firearm and take by threat of force cash, cigarettes and personal property of employees.
For the charges of conspiracy and interference with commerce by robbery, both face up to 20 years in prison. If convicted of brandishing a firearm during a crime of violence they also face a minimum of seven years which must be served consecutively. If convicted of any additional firearms charges, they would also face another mandatory consecutive sentence of 25 years in prison.
The charges are the result of an investigation conducted by the U.S. Postal Inspection Service, in conjunction with the Houston Police Department. Assistant U.S. Attorneys Joe Porto and Heather Winter are prosecuting the case.
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.Eufaula Woman Sentenced to 72 Months, Eufaula Man and Checotah Woman Sentenced to 21 Months for Drug ConspiracyRead the Press Release
MUSKOGEE, OKLAHOMA - The United States Attorney’s Office for the Eastern District of Oklahoma, announced that KERENSA KAELENE MARA, age 38 and MARQUIS WAYNE BRANDT a/k/a Mark Brandt, age 40, both of Eufaula, Oklahoma and REBEL LYNN CRABTREE, age 47, of Checotah, Oklahoma, were sentenced for Drug Conspiracy, in violation of Title 21, United States Code, Section 846.
The defendants were sentenced as follows:
BRANDT: 21 months imprisonment, followed by 3 years of supervised release.
CRABTREE: 21 months imprisonment, followed by 3 years of supervised release.
MARA: 72 months imprisonment, followed by 3 years of supervised release.
Charges arose from an investigation by the Navarro County Sheriff’s Department in Texas, the District 18 District Attorney’s Drug Task Force, the Oklahoma Bureau of Narcotics, the Drug Enforcement Administration and the United States Department of Veterans Affairs, Office of Inspector General. The defendants were indicted in July, 2015 and pled guilty in August, 2015.
The Indictment alleged that beginning in or about October 2014 and continuing to in or about January 2015, in the Eastern District of Oklahoma and elsewhere, the defendants knowingly and intentionally agreed together, with each other, and with other persons known and unknown to the Grand Jury, to illegally obtain Schedule II and IV controlled substances by means of presenting fraudulent prescriptions to pharmacies and conspired to possess with intent to distribute and distribute Schedule II and IV controlled substances.
As part of the conspiracy the defendants would obtain stolen prescription pads, legitimate DEA numbers and copies of doctor’s signatures from the Jack C. Montgomery Veterans Affairs Medical Center, for the purpose of forging prescriptions of controlled substances. The defendants would recruit people to present those forged prescriptions on their behalf in return for pay and then distribute the fraudulently obtained illegal drugs or trade illegal drugs for other drugs.
The Honorable James H. Payne, District Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, presided over the hearings.
Assistant United States Attorney Edward Snow represented the United States.
Eric Dillon Indicted for 7-Eleven Hobbs Act Robbery and Causing DeathRead the Press Release
HAMMOND- United States Attorney David Capp announced today that an Indictment was filed charging Eric M. Dillon, 27, of Gary, Indiana with one count of Hobbs Act Robbery, one count of using a firearm during a crime of violence and one count of causing death during a crime of violence.
On January 20, 2016, at approximately 4:30 am, Dillon allegedly entered the 7-Eleven store at 6031 Hohman Avenue, Hammond, Indiana. Dillon entered the store with a handgun, demanded money, and shot and killed the clerk.
United States Attorney Capp said, “this tragic act of violence will not be tolerated in our community. My office and federal law enforcement will continue to utilize all of our resources to work with our state and local partners to apprehend and prosecute these perpetrators.”
This case was investigated by the Hammond Police Department and the Federal Bureau of Investigation with assistance from the Lake County Prosecutor’s Office. The case is being prosecuted by Assistant United States Attorneys Thomas M. McGrath and Jennifer Chang.
Anyone with any knowledge of Eric Dillon or his associates is urged to call the FBI at 219-769-3719 or 317-595-4000. All phone calls will be treated confidentially.
The United States Attorney's Office emphasized that an Indictment is merely an allegation and that all persons charged are presumed innocent until and unless proven guilty in court.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
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Ellicott City Man Admits to Distributing Heroin Leading to Overdose DeathRead the Press Release
Baltimore, Maryland – Ian Daniel Ugol, age 24, of Ellicott City, Maryland pleaded guilty today to distribution of heroin.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Assistant Special Agent in Charge Don A. Hibbert of the Drug Enforcement Administration (DEA), Baltimore District Office; Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation; and Chief Gary Gardner of the Howard County Police Department.
DEA Assistant Special Agent in Charge Don Hibbert stated, “The Drug Enforcement Administration is focused not only on large scale drug traffickers, but also on cases where the distribution of an illegal drug has a direct causal link to the death of an individual. The arrest and guilty plea in this case illustrates that the results of the illegal distribution of narcotics to users are not only tragic, but are often deadly.”
According to his plea agreement, on November 13, 2013, Ugol communicated with the victim through social media, text messaging and telephone conversations to arrange for Ugol to obtain heroin for the victim’s use. During that time, Ugol was also in contact with another individual known as a source for heroin. Between 10:58 pm on November 13, 2013, and four minutes after midnight on November 14, 2013, there were five short telephone conversations and one text between Ugol and the source of supply arranging for Ugol to obtain heroin for the victim. According to text messages, Ugol and the victim met at or near a bowling alley in Ellicott City to arrange for the victim and Ugol to get the heroin. Before 7:00 a.m. on November 14, 2013, the victim was discovered by his parents at their home, unconscious and was not breathing. He was pronounced dead at 7:13 a.m. and the medical examiner determined that the cause of death was heroin and oxycodone intoxication.
Ugol faces a maximum sentence of 20 years in prison for distribution of heroin. U.S. District Judge Marvin J. Garbis has scheduled sentencing for August 17, 2016, 2016 at 2:15 p.m.
United States Attorney Rod J. Rosenstein commended the DEA, FBI, and Howard County Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Andrea L. Smith, who is prosecuting this Organized Crime Drug Enforcement Task Force case.
East St. Louis Man Sentenced for Firearm OffenseRead the Press Release
James L. Porter, Acting United States Attorney for the Southern District of Illinois, announced today that on March 10, 2016, Anthony M. Williams, 33, East St. Louis, IL, was sentenced for the Unlawful Possession of a Firearm by a Previously Convicted Felon. Williams received 24 months in federal prison, to be followed by 3 years of supervised release, and ordered to pay a $100 special assessment. Williams also agreed to forfeit the illegal firearm that he possessed.
The charge arose on April 10, 2015, when Illinois State Police officers attempted to stop Williams in East St. Louis, Illinois, for traffic violations. Williams did not immediately stop and, as he continued driving, an officer saw him throw something out of the passenger side window. When officers went to the area where they had seen the object thrown, they recovered a FEG, .9mm pistol. Further investigation revealed that Williams had previously been convicted of Unlawful Possession of a Weapon by a Felon in St. Clair County in 2009.
The case was investigated by the Illinois State Police and assigned to Assistant United States Attorneys Don Boyce and Angela Scott for prosecution.
Drug User Possessing a Weapon off to PrisonRead the Press Release
A man who possessed a handgun while intoxicated and had marijuana and cocaine within his system was sentenced today to five years in federal prison.
Darius Omar Akheen Rhone, age 27, from Dubuque, Iowa, received the prison term after a December 16, 2015, guilty plea to a single count Indictment of being a prohibited person in possession of a firearm and ammunition. Rhone’s prohibited status was established by his illegal drug use.
At the guilty plea, Rhone admitted his drug use and possession of the weapon and ammunition on September 1, 2015. At the sentencing hearing, the facts revealed that Rhone, while intoxicated at a local bar, frequently displayed a .22 caliber pistol kept in his waistband and had threatened to hurt someone. The loaded magazine was in the weapon but a round was not chambered. Further investigation revealed Rhone was in possession of a small quantity of marijuana and later tested positive for both marijuana and cocaine use.
Rhone was sentenced in Cedar Rapids by United States District Court Chief Judge Linda R. Reade to 60 months’ imprisonment. A special assessment of $100 was imposed and he must also serve a 3-year term of supervised release after the prison term. There is no parole in the federal system. Rhone is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Steve Young and investigated by the Dubuque Police Department.
Court file information at: https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 15-CR-01025.
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Dinner Cruise Ship Captain Arrested for Using Stolen IdentityRead the Press Release
HOUSTON – A ship captain for Majestic Ventures, Majestic Dinner Cruises and Majestic Yacht Charters dinner cruise lines has been arrested on charges of using a stolen identity for more than 20 years, announced U.S. Attorney Kenneth Magidson.
Cynthia Lyerla, 52, of League City, allegedly used the identity of Christina White to obtain driver’s licenses, passports, mariner licenses and Transportation Security Administration (TSA) documentation allowing her to enter secure port areas. Without a mariner license and TSA documentation, Lyerla would not be allowed to captain the ships for the dinner cruise companies.
Lyerla was charged in a four-count indictment returned under seal on March 8, 2016, and unsealed today. She was taken into custody this morning and is expected to make her initial appearance before U.S. Magistrate Judge Frances H. Stacy at 2:00 p.m.
The indictment alleges Lyerla used the identity of Christina White, who passed away in 1965. She is charged with aggravated identity theft, false statements in a passport application, unlawful use and possession of a mariner license and unlawful use by false personation of a transportation worker identification credential.
According to the indictment, Cynthia Lynn Knox was born in 1964, later married Harold Lyerla and took his name. The marriage ended when Harold Lyerla was murdered in 1988 in Lompoc, California. Although another individual was convicted for that crime, Lyerla’s fingerprints were taken by the local police in the course of the investigation.
Since that time, Lyerla has allegedly used the identity of Christina White to obtain driver’s licenses, passports, mariner’s licenses and TSA documentation allowing her access into secure port areas. In applying for those documents, she not only used the name Christina White, but also provided Christina White’s date of birth, place of birth, Social Security number and parents’ names, according to the charges.
The indictment alleges her true identity was confirmed after her fingerprints were taken in connection with a mariner license application.
If convicted, she faces up to 10 years in federal prison.
The charges were the result of an investigation conducted by the Department of State - Diplomatic Security Service and U.S. Coast Guard Investigative Service. Assistant U.S. Attorney Adam Goldman is prosecuting the case.
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.
Detriot Area Doctors Charged with Illegal Distribution of Prescription DrugsRead the Press Release
A superseding indictment was unsealed today charging three doctors and seven other individuals with conspiracy to illegally distribute prescription drugs, U.S. Attorney Barbara L. McQuade announced today.
McQuade was joined in the announcement by Acting Special Agent in Charge David A. Grant, U.S. Drug Enforcement Administration (DEA), Detroit Field Division and Jared Koopman, Special Agent in Charge, Internal Revenue Service, Criminal Investigation.
Charged in the superseding indictment are:
Dr. Boris Zigmond, D.C., 50, of West Bloomfield
Dr. Jennifer Franklin, M.D., 39, of Harrison Township
Dr. Carlos Godoy, M.D., 78, of Farmington Hills
Rodney Knight, 32, of Highland Park
Tara Marcia Jackson, 53, of Detroit
Sashanti Morris, 44, of Detroit
Anna Fradlis, 61, of West Bloomfield
Maryna Pitsenko, 46, of Sterling Heights
Svetlana Sribna, 64, of Sterling Heights
Marina Jacobs, 44, of West Bloomfield
The superseding indictment alleges that from January 2013 through May 2015, Zigmond was the leader of a large-scale prescription drug trafficking organization whose purpose was to secure written prescriptions from medical doctors for controlled substances, primarily Roxicodone, and its generic equivalent Oxycodone, that could be filled at various pharmacies. According to the superseding indictment, Zigmond’s organization distributed approximately 1 million pills and grossed approximately $5.7 million from trafficking these pills on the illegal street market. The prescriptions for these highly addictive drugs were written outside the course of usual medical practice and for no legitimate purpose.
The superseding indictment further alleges that Zigmond, a chiropractor, did not see patients himself or write prescriptions but rather used co-defendants Rodney Knight, Tara Jackson and Sashanti Morris as “marketers” or “patient recruiters” who would pay money directly to Zigmond or Zigmond’s assistants, co-defendants Anna Fradlis, Maryna Pitsenko, Svetlana Sribna and Marina Jacobs who would then schedule appointments with co-defendants Dr. Franklin and Dr. Godoy. Each appointment cost $500-$600 cash and the “marketer” paid the money before a phony patient was seen by either Franklin or Godoy.
“Diversion of prescription pills to the street market promotes the addiction to painkillers that leads to overdose deaths,” McQuade said. “We are focusing on charging doctors, pharmacists and the networks that are putting this poison on the streets.”
DEA Acting Special Agent in Charge David A. Grant stated, “The arrests today are just one example of DEA's determination and commitment to combat the troubling prescription drug abuse problem in this country. The doctors involved in this investigation abused their positions of trust and jeopardized the lives of many individuals by participating in the conspiracy to distribute nearly a million dosage units of controlled substances onto the streets of southeast Michigan and beyond. These indictments should make it clear that the DEA and our law enforcement partners are focused on investigating and pursuing those that are illegally diverting prescription drugs into our communities.”
“Physicians who prescribe drugs to those without a medical purpose but rather for the known purpose of selling them on the street is extremely harmful to our communities,” said Special Agent in Charge Jarod Koopman, IRS- CI. “Where the law allows, we will continue to follow the money and seize the proceeds from those that profit at the expense of our neighborhoods.”
According to the superseding indictment, Zigmond set up office suites in several different locations in Oak Park, where co-defendants Franklin and Godoy would see fake patients and write the prescriptions. Franklin, Godoy, Fradlis, Pitsenko, Sribna and Jacobs were paid by Zigmond.
In addition to the drug conspiracy charge, Zigmond was also charged with money laundering and Knight was also charged with being a felon in possession of a firearm. The United States will pursue forfeiture of all proceeds and property traceable to the offenses charged.
An indictment is only a charge and is not evidence of guilt. Each defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.
The case was investigated by Special Agents of the DEA and IRS. The case is being prosecuted by Assistant U.S. Attorneys Wayne Pratt and Jonathan Grey.
Defendants from Northern Colorado Heroin Network Convicted and Sentenced for Their Roles in Drug Trafficking Which Resulted in DeathRead the Press Release
DENVER – Four defendants who were indicted by a federal grand jury in Denver for their roles in the distribution of heroin which resulted in a fatal overdose have all be convicted and sentenced, U.S. Attorney John Walsh, FBI Denver Division Special Agent in Charge Thomas Ravenelle and Longmont Public Safety Chief Mike Butler announced. The four defendants were charged following the March 4, 2013 fatal overdose of an individual in Longmont, Colorado. In their respective plea agreements, all four admitted their roles in the distribution of the heroin which resulted in that fatality. The January 23, 2015 arrests of the four federal defendants were conducted simultaneously with those of 10 other persons who were named in state charges for possession and/or distribution of a schedule I controlled substance.
Brice Alday and his three co-defendants have all pled guilty and were sentenced by U.S. District Court Judge Christine M. Arguello. Lead defendant Brice Alday was sentenced to serve 120 months (10 years) in federal prison for Conspiracy to Distribute Heroin. Danielle Sciortino was sentenced to serve 60 months (5 years) in federal prison for conspiracy to distribute heroin, the use of which resulted in death. Jesse Hervey was sentenced to serve 36 months (3 years) in federal prison for that same charge. Finally, Jacquelynn Bradley was sentenced to serve 5 years’ probation, with the first 8 months in home detention for her role in the conspiracy to distribute heroin.
“Heroin is a deadly drug that is killing young people across all segments of our society,” said U.S. Attorney John Walsh. “This heroin trafficking network sold a dangerous drug that resulted in the death of an individual. Because of their conduct, they will be held criminally accountable. And a word to other heroin dealers – you’re next.”
"The distribution of heroin is a serious matter because in addition to the victim in this case, the drug is killing thousands of people across the country. In fact, heroin abuse is now a full-fledged epidemic in the United States. That's why we will continue to work closely with the United States Attorney's Office to investigate and prosecute heroin traffickers like the defendants in this case," said Denver FBI Special Agent in Charge Thomas Ravenelle.
“This was a great partnership between the FBI, Longmont Police Department, and the U.S. Attorney’s Office, and we could not have pulled off this major investigation without the support and teamwork between these three agencies,” said Longmont Public Safety Chief Mike Butler. “It had a positive impact in our community and sent a strong message that we are taking narcotics investigations seriously.”
This case was investigated by the Federal Bureau of Investigation, Fort Collins Resident Agency and the Longmont Police Department. In addition, the Boulder District Attorney’s Office and the Boulder County Coroner’s Office worked closely with law enforcement in the investigation and prosecution of these defendants.
The federal defendants were prosecuted by Assistant U.S. Attorney Bradley Giles.
Defendant Sean Anthony Lizama Sentenced to Ninety Six Months IncarcerationRead the Press Release
ALICIA A.G. LIMTIACO, United States Attorney for the Districts of Guam and the Northern Mariana Islands (NMI), announced that on March 7, 2016, Defendant SEAN ANTHONY LIZAMA was sentenced by the Honorable Frances Tydingco-Gatewood, Chief Judge, District Court of Guam. Defendant was sentenced to serve 96 months incarceration followed by three years of supervised release, with credit for time served.
Defendant LIZAMA pled guilty on January 15, 2015, to Attempted Possession of Methamphetamine with Intent to Distribute, in violation of Title 21 U.S.C. Section 846(a)(1) and (b)(1)(C). Defendant LIZAMA attempted to receive 214.9 grams of methamphetamine hydrochloride on October 16, 2013. The Drug Enforcement Administration Forensic Laboratory determined that the methamphetamine had a purity level of 100%.
The investigation was conducted by U.S. Postal Inspectors and Special Agents from the Department of Homeland Security, Homeland Security Investigations.
U.S. Attorney Limtiaco notes that this prosecution is part of the U.S. Department of Justice’s Project Safe Neighborhood (PSN) Initiative, a nationwide commitment to aggressively prosecute defendants who illegally possess firearms, engage in violent crimes, drug distribution and gang involvement.
The case was handled by Assistant U.S. Attorney Rosetta San Nicolas.
Danbury Man Sentenced to 16 Years in Federal Prison for Armed Home InvasionsRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that MARLON PATTERSON, also known as “Head,” 32, of Danbury, was sentenced today by U.S. District Judge Stefan R. Underhill in Bridgeport to 192 months of imprisonment, followed by five years of supervised release, for orchestrating a series of violent home invasion robberies of illegal drugs and drug trafficking proceeds.
According to court documents and statements made in court, in January 2013 the Danbury Police Department began investigating a narcotics trafficking network, headed by PATTERSON and Michael Spears, which maintained a series of drug distribution locations, known as trap houses, in Danbury, out of which members of the organization sold crack cocaine and heroin. The organization also rented hotel rooms where they packaged and distributed narcotics. The investigation also revealed that PATTERSON, Spears and others had organized and committed armed home invasion robberies of marijuana dealers on January 30, February 14 and February 18, 2013. During each of the robberies, PATTERSON and others, wearing masks and armed with firearms, forced entry into the residence of a known marijuana dealer. Once inside, the perpetrators attempted to or did steal marijuana and cash. In each instance, the perpetrators pistol whipped a victim and threatened to kill others within the home.
In addition, in May 2013, PATTERSON and his associate, Paul Whitehurst, kidnapped an individual who owed Whitehurst a drug debt of approximately $100. Whitehurst physically and verbally assaulted the victim as they drove to a nearby reservoir. At the reservoir, Whitehurst pushed the victim into the water and then threw rocks at him. PATTERSON recorded the incident on his phone and can be heard laughing in the video.
PATTERSON and Whitehurst then drove the victim to a liquor store and purchased a liter of vodka, which Whitehurst forced the victim to drink in its entirety in approximately 15 minutes until the victim lost consciousness. The victim, still unconscious, was then driven to a trap house where he was locked in a bathroom overnight. The next day, PATTERSON and Whitehurst directed the victim to work off his drug debt by selling heroin to customers. After selling the drugs, the victim was released.
PATTERSON’s criminal history includes several felony convictions. In September 2007, he shot an individual in the face and subsequently served approximately five years of imprisonment. Sometime after his release from prison he had the words “Face Shot” tattooed on his arm. PATTERSON faces up to eight years of state incarceration for violating his probation.
PATTERSON has been detained since his arrest on October 16, 2013. On May 1, 2015, he pleaded guilty to one count of interference with commerce by robbery, one count of attempted interference with commerce by robbery, and one count of use of a firearm during and in relation to crimes of violence.
Spears has pleaded guilty and awaits sentencing. Whitehurst also pleaded guilty and, on March 20, 2015, was sentenced to 48 months of imprisonment.
This matter was investigated by the Drug Enforcement Administration’s New Haven Task Force and the Danbury Police Department. The DEA Task Force includes personnel from the New Haven, Hamden, Branford, Meriden, West Haven, North Haven, East Haven, Derby and Ansonia Police Departments. The case is being prosecuted by Assistant U.S. Attorneys Tracy Dayton and Vanessa Richards.
Convicted Felon from Chicago Indicted on Federal Firearm OffensesRead the Press Release
CHICAGO — A Chicago man with a prior felony conviction has been indicted on federal gun charges for illegally dealing and possessing firearms.
The indictment contends that LAZARO SALAS, 32, illegally dealt firearms from September 2013 to November 2015. Salas allegedly purchased between 40 and 60 guns through a straw purchaser and then later re-sold them, according to a federal criminal complaint and affidavit. Two of the firearms were later found in the possession of Chicago gang members, the complaint states.
On Jan. 7, 2016, Salas purchased four handguns from an undercover agent with the U.S. Bureau of Alcohol, Tobacco, Firearms & Explosives, according to the complaint. The sale took place in a store parking lot near Salas’ residence in Chicago. Salas paid $350 for two of the guns, and he agreed to purchase the other pair for $200 and an ounce of marijuana, according to the complaint.
Salas was previously convicted of a felony, the indictment states.
The indictment was returned Tuesday in U.S. District Court in Chicago. It charges Salas with one count of dealing firearms without a license, and one count of being a felon-in-possession of a firearm. An arraignment date in federal court has not yet been set.
The charge of dealing firearms without a license is punishable by up to five years in prison, while being a felon-in-possession of a firearm carries a maximum sentence of ten years in prison and a $250,000 fine.
The indictment was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Jeffrey A. Magee, Special Agent-in-Charge of the Chicago Field Division of ATF; and John Escalante, Interim Superintendent of the Chicago Police Department. The Illinois State Police also assisted in the investigation.
The public is reminded that an indictment is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
The government is represented by Assistant U.S. Attorney Scott Edenfield.
Indictment
Child Pornographer Sentenced to 33 1/3 Years in PrisonRead the Press Release
United States Attorney Andrew M. Luger today announced the sentencing of SEAN GERALD PENONCELLO, 42, for the production of child pornography involving two minor victims. On June 9, 2015, PENONCELLO was charged by superseding indictment with two counts of producing child pornography and one count of possessing child pornography. Following a three-day trial before Judge Patrick J. Schiltz, a jury on September 23, 2015, found PENONCELLO guilty of all counts. The defendant was sentenced today before Judge Schiltz.
“Penoncello is a predator,” said Assistant United States Attorney Laura Provinzino. “Not only did he commit a series of heinous crimes against women and children, but he also showed not one iota of remorse to his victims, including a 5-year-old girl entrusted to his care. The long sentence handed down today is warranted.”
“The FBI remains committed to protecting those who are most vulnerable,” said Special Agent in Charge of the FBI Minneapolis Division Richard T. Thornton. “Those who would engage in the production, distribution, or viewing of child pornography will always be on the radar of law enforcement.”
As proven at trial, on April 3, 2014, a series of nude images of an unidentified five-year-old minor were submitted to the National Center for Missing and Exploited Children (NCMEC) that were traced back to PENONCELLO’s residence in Cherry, Minn. On March 27, 2015, law enforcement executed a search warrant of PENONCELLO’s residence and recovered two hidden thumb drives and a surreptitious recording device taken from PENONCELLO’s truck.
As proven at trial, the evidence contained on the two thumb drives revealed sexually explicit images and videos of a second minor victim, produced when the victim was 14-years-old. The thumb drives also contained numerous pornographic images and videos of other known NCMEC-identified minor victims.
If you know of any child who may have been a victim of exploitation, please call the National Center for Missing or Exploited Children (NCMEC) at 1-800-THE-LOST (1-800-843-5678) or visit NCMEC’s web site at www.missingkids.com.
This case is the result of an investigation conducted by the Federal Bureau of Investigation and the St. Louis County Sheriff’s Office, with assistance from the St. Louis County Attorney’s Office, Virginia Police Department and Eveleth Police Department.
This was prosecuted by Assistant U.S. Attorneys Laura M. Provinzino and Benjamin F. Langner.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Defendant Information:
SEAN GERALD PENONCELLO, 42
Iron, Minn.
Convicted:
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Production of Child Pornography, 2 counts
- Possession of Child Pornography, 1 count
Sentenced:
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33 1/3 years in prison
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10 years supervised release
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
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Chesapeake Man Sentenced for Illegally Receiving Silencers from CanadaRead the Press Release
NORFOLK, Va. – Benjamin Lloyd Fisher, 42, of Chesapeake, was sentenced today to 30 months in prison for illegally receiving imported firearms, namely silencers.
Fisher pleaded on Nov. 17, 2015. According to court documents, Fisher admitted that in the spring of 2014 he purchased a homemade .22 caliber suppressor (silencer) from a Canadian source he had met online. The parties arranged that the silencer would be shipped to Fisher in two separate packages, in order to avoid detection by U.S. Customs and Border Patrol. Based on email correspondence between Fisher and his Canadian source, as well as other evidence, in May 2015 ATF agents executed a search warrant on the home in Chesapeake that Fisher shared with his mother. During the search agents recovered 13 firearms, eight silencers, and crates of ammunition. One month later, 5 additional firearms associated with Fisher were recovered. Fisher is a convicted felon and unable to possess a firearm. After the search warrant and prior to his arrest, the Chesapeake Police received a phone call from one of Fisher’s relatives which caused the police to conduct a welfare check on Fisher. When the police arrived, Fisher hid inside his bedroom and told the police that his door was booby trapped with an explosive device and that he had a bomb around his neck. After a stand-off lasting several hours, Fisher finally surrendered. No bombs or explosive devices were found.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Charles E. Smith, Special Agent in Charge of Alcohol, Tobacco, Firearms, and Explosives’ (ATF) Washington Field Office, made the announcement after sentencing by Senior U.S. District Judge Robert G. Doumar. Assistant U.S. Attorneys William D. Muhr and V. Kathleen Dougherty prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:15cr117.
Carmichael Man Sentenced to 5 Years in Prison for Possessing Biological Toxin and Selling Machine GunsRead the Press Release
SACRAMENTO, Calif. — James Christopher Malcolm, 31, of Carmichael, was sentenced today to five years in prison for possessing abrin, a biological toxin; unlawful dealing in firearms; and possession and transfer of a machine gun, United States Attorney Benjamin B. Wagner announced.
United States District Judge Troy L. Nunley also ordered Malcolm to pay $30,918 in restitution.
According to court documents, Malcolm met with a confidential informant to discuss a plan to sell fully automatic rifles. At the meeting, Malcolm told the informant that distributing firearms was only a side business, and his main business was distributing explosives and poison. Later, Malcolm sold four short-barrel AR-15-style machine guns, 1.5 pounds of improvised explosive material, three blasting caps, and a firearm silencer to undercover agents posing as arms dealers for drug trafficking organizations. Additionally, Malcolm told undercover law enforcement agents that he could manufacture parts to convert Glock pistols into fully automatic machine guns. Malcolm actually demonstrated the process of converting pistols to machine guns and over the course of various meetings, sold the agents parts to convert 10 pistols.
In addition to face-to-face sales, Malcolm also utilized the online moniker “Dark_Mart.” Using the Dark_Mart moniker, Malcolm opened a seller’s account on Black Market Reloaded (BMR), an online marketplace accessed via TOR network. Malcolm’s Dark_Mart page on BMR provided a menu of items for sale, including Glock auto-sears, explosives, ricin, and abrin.
Abrin is a natural poison found in the seed of the rosary pea, a tropical plant. Similar to ricin, abrin is a protein inhibitor that prevents cells from making the proteins they need to survive. A dose as small as several micrograms may be fatal. The cause of death is typically internal bleeding or organ failure within three days. Abrin can be injected, inhaled, or swallowed. Abrin is classified as a “Select Agent and Toxin” by the United States Department of Health and Human Services because of the potential severe threat to public health and safety.
On BMR, Malcolm was contacted by two separate individuals who desired to purchase abrin, one in New York and one in San Francisco. Malcolm agreed to ship abrin to the two individuals in exchange for payment in bitcoin. On December 5, 2013, Malcolm shipped two packages from Vacaville, one to New York and one to San Francisco. Both shipments contained small glass vials filled with a rudimentary form of abrin concealed within flashlights.
This case was the product of an investigation by the Bureau of Alcohol Tobacco, Firearms and Explosives and the Federal Bureau of Investigation. Assistant United States Attorney Justin Lee prosecuted the case.
Caddo Parish Commissioner Michael Williams found guilty of stealing from nonprofitRead the Press Release
SHREVEPORT, La. – United States Attorney Stephanie A. Finley announced today that a federal grand jury indicted Caddo Parish Commissioner Michael Dwayne Williams for defrauding the Caddo Parish Commission and stealing from a nonprofit meant to help at-risk youth.
Williams, 54, of Shreveport, was indicted on 12 counts of wire fraud. The indictment alleges that from October 1, 2012 through July 1, 2014, Williams devised a scheme to take more than $2,000 from a nonprofit’s bank account. Williams urged the parish commission to appropriate public funds for the nonprofit SWAG Nation. Once those funds were allocated from the parish’s budget to SWAG Nation, Williams caused a bank debit card to be issued for the nonprofit. Between April of 2013 and July of 2014, Williams used an ATM card to remove money on numerous occasions. According to the indictment, he took $100 to $200 each time that he made a withdrawal initializing 12 transactions from August 2013 to June 2014 for personal use. SWAG Nation’s declared purpose is to partner with local institutions to help mentor and counsel at-risk individuals ages 7 to 17 so that they can better function in society.
“The Caddo Parish Sheriff’s Office investigated Michael Williams for several months and is pleased with the return of this indictment,” said Caddo Sheriff Steve Prator. “Unfortunately, there are people elected to office who will abuse the public’s trust. This money was meant for children, not politicians.”
Williams faces up to 20 years in prison, five years of supervised release, and a $250,000 fine for each count.
The FBI and Caddo Parish Sheriff’s Office conducted the investigation. Assistant U.S. Attorneys Joseph G. Jarzabek and Brandon B. Brown are prosecuting the case.
An indictment is merely an accusation, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
Bulgarian Man Arrested and Charged in Manhattan Federal Court with $400 Million Market Manipulation Scheme Involving Avon Stock, as Well as Market Manipulation and Insider Trading of Two Other SecuritiesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and Diego Rodriguez, the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced the arrest and unsealing of an eight-count indictment charging NEDKO NEDEV, 38, a citizen of Bulgaria and the United States, with various crimes related to market manipulation, insider trading, and aggravated identity theft for devising and carrying out a series of schemes (1) to manipulate the public market for two securities – Rocky Mountain Chocolate Factory, Inc. (“Rocky Mountain”), and Avon Products, Inc. (“Avon”) – through sham tender offers filed publicly with the Securities and Exchange Commission (the “SEC”), and (2) to trade on material, nonpublic information about an impending tender offer by Bulgarian company Euroins Insurance Group AD (“Euroins”) for U.S.-based insurer Tower Group International Ltd. (“Tower Group”), which NEDEV knew about because of his role advising the proposed acquirer. The sham offer for Avon, a company with more than 400 million shares outstanding, caused a 400-percent increase over the average per-day trading volume, resulting in a manipulation of the market by hundreds of millions of dollars, and caused the New York Stock Exchange (“NYSE”) to halt trading three times in Avon shares in the half-hour period following the sham offer. NEDEV was arrested in Bulgaria and his extradition to the U.S. will be sought. The case has been assigned to Judge Kimba M. Wood.
In a separate action, the SEC previously filed civil charges against NEDEV for market manipulation in June 2015.
U.S. Attorney Preet Bharara said: “As alleged, Nedko Nedev engaged in elaborate schemes to manipulate the market in various publicly traded securities. His alleged lies caused massive swings in share prices and trading volume, including a sham tender offer that required the New York Stock Exchange to halt trading in Avon shares. Nedev’s alleged securities fraud schemes also involved purchasing shares of a U.S. insurance company he knew, through inside information, to be the acquisition target of a European company he was advising. If you manipulate the U.S. securities markets with disinformation and deception, whether from New York or from Bulgaria, as Nedev is alleged to have done, you will be held to account.”
FBI Assistant Director-in-Charge Diego Rodriguez said: “As alleged, Nedko Nedev created and carried out a market manipulation scheme not once but twice to profit himself. Today, he faces charges for those schemes as well as identity theft and insider trading. The FBI will continue to work with our partners in an effort at ensuring that our financial markets are legal, fair, and equitable.”
According to the allegations in the Indictment unsealed today in Manhattan federal court:[1]
From at least in or about January 2012 through at least in or about December 2012, NEDEV devised and carried out a scheme to manipulate the public market for Rocky Mountain stock, enrich himself, and mitigate trading losses. In furtherance of the scheme, NEDEV artificially inflated the share price and trading volume of Rocky Mountain through a sham tender offer he caused to be filed on December 18, 2012, on EDGAR, the Electronic Data Gathering, Analysis and Retrieval System, which is the means by which companies and others file public documents with the SEC (the “Rocky Mountain Offer”).
Three years later, from at least in or about April 2015 through at least in or about May 2015, NEDEV devised and carried out a similar scheme to manipulate the public market for Avon stock, enrich himself, and mitigate trading losses. In furtherance of the scheme, NEDEV inflated the share price and trading volume of Avon stock through a sham tender offer he caused to be filed on EDGAR (the “Avon Offer”). In making the Avon Offer, NEDEV used nearly identical means and methods to those used in the Rocky Mountain Offer filed on EDGAR in 2012. Unlike the Rocky Mountain Offer, however, the Avon Offer was filed early in the trading day, causing a significant impact on Avon’s trading volume and share price and permitting NEDEV to sell a portion of his Avon holdings for a profit.
In between the Rocky Mountain Offer and the Avon Offer, from in or about October 2013 through at least in or about May 2014, NEDEV carried out a scheme to enrich himself by trading on material, nonpublic information concerning an offer by Euroins to acquire Tower Group, which NEDEV obtained from the Chairman of Euroins’ parent company, Eurohold (the “Eurohold Chairman”) and which he understood was nonpublic at the time, and which he was duty-bound not to misappropriate for his own personal benefit. In May 2014, after Euroins publicly offered to acquire Tower Group, NEDEV sold a portion of his shares of Tower Group for a profit.
Nedev’s Brokerage Accounts
Between in or about June 2008 and in or about at least June 2015, NEDEV traded equities, options, and Contracts for Difference of publicly traded companies through U.S.-based online broker-dealers at which NEDEV maintained certain accounts, including: (a) Strategic Wealth Investments Inc. (the “Strategic Wealth Account”); (b) SWIP Capital Partners, Inc. (the “SWIP Account”); (c) Strategic Capital Partners Muster Limited (the “Strategic Capital Account”); and (d) Strategic Capital Partners Muster Limited CFD Account (the “Strategic Capital CFD Account,” collectively with the Strategic Capital Account, the “Strategic Capital Accounts”).
The Rocky Mountain Market Manipulation
From at least in or about December 2008, NEDEV caused the Strategic Accounts to hold shares of Rocky Mountain stock. When NEDEV opened the Strategic Capital Account in July 2012, Rocky Mountain was the first stock purchased. As of August 2012, the Strategic Accounts held shares of Rocky Mountain valued at more than $1.1 million. After reaching a peak share price of almost $14.00 per share in August 2012, Rocky Mountain’s share price began to decline steadily. By November 2012, the price had dropped to approximately $10.36 per share. By that time, NEDEV’s Rocky Mountain holdings in the Strategic Accounts had accumulated a total of approximately $250,000 in unrealized losses as well as approximately $278,000 in realized losses.
To effectuate the scheme to manipulate the market in Rocky Mountain, NEDEV created a fictitious entity to make a sham tender offer for Rocky Mountain. Previously, on or about January 28, 2012, NEDEV had registered the email account [email protected] (the “Bali Email Account”) at a U.S.-based email provider (the “Provider”). Between January 2012 and May 2015, NEDEV used the Bali Email Account to send and receive emails in the name of “Peter Bali,” a name he used in the course of the scheme, as well as other names. On or about November 21, 2012, NEDEV caused Rocky Mountain to receive a voicemail from an individual who purported to be named “Peter Bali.” The voicemail indicated that Bali had mailed a tender offer to purchase Rocky Mountain on behalf of a company purportedly called “PST Capital Group” (“PST”). One week later, on or about November 28, 2012, NEDEV caused Rocky Mountain to receive a letter of intent from PST (the “PST Letter of Intent”), which identified Bali as the “Chairman” of PST and indicated that PST was based in London, England. The PST Letter of Intent offered, among other things, to purchase all outstanding shares of Rocky Mountain at a price of $13.50 per share. On or about December 6, 2012, NEDEV caused Rocky Mountain to receive another voicemail from the individual purporting to be Bali asking if Rocky Mountain had received the PST Letter of Intent. In truth and in fact, PST did not exist, as it had been invented for the purpose of effecting the market manipulation scheme.
Approximately two weeks later, on or about December 13, 2012, NEDEV caused a Form ID (the “PST Form ID”) to be filed with the SEC from Bulgaria. The PST Form ID, which requested that PST be allowed to file documents on EDGAR, indicated that PST was based in London, England, and contained a notary stamp purporting to be associated with a particular California-based registered notary (the “PST Notary”). In truth and in fact, the stamp was forged, as the PST Notary neither notarized the PST Form ID, nor authorized anyone to use the PST Notary’s name or notary credentials to do so, as NEDEV well knew.
To further effectuate the market manipulation scheme, NEDEV caused the Rocky Mountain Offer to be filed on EDGAR on or about December 18, 2012, after the close of the trading day. As with the PST Form ID, the Rocky Mountain Offer was filed from Bulgaria. As with the PST Letter of Intent, the Rocky Mountain Offer was made in the name of PST, listed Bali as PST’s Chairman, and proposed to acquire all of Rocky Mountain’s stock at $13.50 per share, which represented an approximately 27 percent premium above the stock’s closing price as of December 18, 2012. The Rocky Mountain Offer also contained certain specific language regarding certain terms of the Rocky Mountain Offer.
Rocky Mountain’s share price was approximately $10.60 when the market closed at 4:00 p.m. on December 18, 2012. As intended by NEDEV, Rocky Mountain’s share price began to increase following the release of the Rocky Mountain Offer.
Before the markets opened on December 19, 2012, Rocky Mountain issued a press release publicly filed on EDGAR as a Form 8-K (the “Rocky Mountain Press Release”) indicating that the Rocky Mountain Offer appeared to be fake. Rocky Mountain’s share price opened at approximately $11.00 per share. Although the Rocky Mountain Press Release diminished the impact of the Rocky Mountain Offer, inasmuch as the release was issued before the trading day began, the stock price nonetheless rose approximately 4.6 percent during market hours on December 19, 2012, to a high of $11.09 per share, and the trading volume increased approximately 1,775 percent on that day.
NEDEV did not cause any shares of Rocky Mountain to be sold from the Strategic Accounts on December 19, 2012.
The Avon Market Manipulation
From at least in or about February 2012, the Strategic Accounts held Avon stock and Avon derivatives, specifically options and CFDs. As of April 2015, NEDEV caused the Strategic Accounts to hold positions in Avon valued at more than $225,000. After reaching a share price of $15.28 per share in April 2014, Avon’s share price began to decline steadily. By April 2015, the share price had dropped to $8.17 per share. By that time, NEDEV had suffered a total of approximately $46,000 in unrealized losses on his Avon holdings.
To effectuate the scheme to manipulate the market in Avon, NEDEV created a fictitious entity to make a sham tender offer for Avon. Thus, on or about April 16, 2015, NEDEV caused the email account [email protected] (the “PTG Email Account”) to be registered with the Provider. The PTG Email Account was registered in the name “Steve Kohe.”
Five days later, on April 21, 2015, NEDEV caused a Form ID (the “PTG Form ID”) to be filed with the SEC requesting access to file documents on EDGAR on behalf of the purported entity PTG Capital Partners Ltd. (“PTG”). The PTG Form ID provided the PTG Email Account and listed “Steve Kohe,” a name NEDEV used to execute the scheme, as PTG’s Chief Compliance Officer. In truth and in fact, PTG did not exist, as it had been invented by NEDEV for the purpose of effecting his market manipulation scheme. Like the PST Form ID, the PTG Form ID indicated that PTG operated in London, England. Also like the PST Form ID, the PTG Form ID contained a notary stamp purporting to be associated with another California-based registered notary (the “PTG Notary”). In truth and in fact, the PTG Notary neither notarized the PTG Form ID, nor authorized anyone to use the PTG Notary’s name or notary credentials to do so, as NEDEV well knew.
To further effectuate the market manipulation scheme, NEDEV caused the Avon Offer to be filed on EDGAR on May 14, 2015, at approximately 11:34 a.m., in the first half of the trading day. The Avon Offer proposed to acquire all of Avon’s stock at $18.75 per share, which represented an approximately 181 percent premium above the stock’s closing price on May 13, 2015. As with the Rocky Mountain Offer, the Avon Offer was filed from Bulgaria. In addition, the Avon Offer contained nearly identical language as was contained in the Rocky Mountain Offer.
The Avon Offer significantly affected the share price and trading volume of Avon, a company with more than 400 million publicly trading shares. Approximately half an hour after the Avon Offer was publicly filed at 11:34 a.m., Bloomberg released an article (the “Bloomberg Article”) indicating that Avon had stated the Avon Offer was fake. During the approximate half hour after the public release of the Avon Offer but before the Bloomberg Article, the share price of Avon increased to a high of $8.00 per share from a low of $6.60 per share, the effect of which was to manipulate the market by hundreds of millions of dollars. The total trading volume during just this approximate half-hour period was more than 17 million shares, more than the average per-day trading volume for the three-month period before the Avon Offer. In total, the trading volume on the day of the Avon Offer was more than 69 million shares, an increase of more than 400 percent over the average per-day trading volume for the three-month period before the Avon Offer. As a result of this significant increase in the volume of trading, the NYSE halted trading three times in Avon shares in the half-hour period following the Avon Offer.
Approximately 25 minutes after the Avon Offer was filed on EDGAR, NEDEV sold a portion of his Avon holdings at the artificially inflated price. Through these sales, NEDEV earned profits in the Strategic Capital Accounts. The Avon Offer also caused the value of his unsold Avon positions to increase significantly during the time period of the manipulation.
Despite the release of the Bloomberg Article reporting that the Avon Offer was a sham, the unusually high trading volume continued as the market adjusted to the news, including as certain individuals who purchased shares at an artificial price as a result of the Avon Offer sought to unwind those positions.
The Insider Trading Scheme
In or about October 2013, through a pre-existing relationship with the Eurohold Chairman, NEDEV learned that Euroins was interested in acquiring a U.S.-based insurance company and that Tower Group was one of the target companies under consideration. NEDEV encouraged the Eurohold Chairman to make an offer for Tower Group and offered to act as an external consultant to help bring the deal to fruition. NEDEV and the Eurohold Chairman agreed that NEDEV would act as an external consultant and that NEDEV would be compensated if a deal were consummated.
In or about October 2013, possessing the Inside Information that Euroins was considering a business combination with Tower Group, NEDEV began purchasing Tower Group stock in the Strategic Accounts.
On or about January 6, 2014, Tower Group announced that it had entered into a merger agreement in which Tower Group was to be acquired by another insurer, ACP Re, for $3.00 per share. Because NEDEV believed the price of Tower Group stock would increase if a competing offer by Euroins were made at a higher price, he took steps to prevent the merger with ACP Re from being consummated so that an offer from Euroins would be viable. To further effectuate his insider trading scheme, NEDEV participated in numerous emails and phone calls to encourage Euroins to continue to pursue an offer for Tower Group, notwithstanding Tower Group’s announcement of a different deal.
Between January and May 2014, NEDEV continued to accumulate Tower Group stock in the Strategic Accounts. By May 13, 2014, the Strategic Accounts held more than 385,000 shares of Tower Group stock valued at approximately $863,000, which represented the second largest position by value in the Strategic Accounts. At that time, the Tower Group position also represented an unrealized loss of approximately $258,000, as the share price of Tower Group had declined from a high of approximately $2.98 per share on January 6, 2014, to a low of $1.67 per share on May 7, 2014.
Between May 8, 2014, and May 13, 2014, NEDEV took specific steps to encourage Euroins to make a tender offer for Tower Group, despite NEDEV’s knowledge, which he acquired during the scheme, that Euroins’s proposed offer lacked certain detail considered essential in such a transaction, such as information about how Euroins would finance any offer for Tower Group stock. On or about May 13, 2014, at the direction of NEDEV, Euroins sent a letter of intent (the “Euroins Letter of Intent”) to Tower Group offering to acquire all of Tower Group’s outstanding stock for $3.75 per share (the “Tower Group Offer”). The Tower Group Offer represented a premium of approximately 67 percent over the then-current Tower Group share price and a premium of $.75 per share over the pending ACP Re offer.
At approximately 12:26 p.m. on May 13, 2014, Euroins issued a press release (the “Euroins Press Release”) through a U.S.-based newswire service stating that Euroins had submitted an acquisition offer to Tower Group. The language contained in the Euroins Press Release was nearly identical to the language contained in the December 2012 Rocky Mountain Offer, which would later be included in the Avon Offer.
Almost immediately after the Euroins Press Release was issued at approximately 12:26 p.m. on May 13, 2014, Tower Group’s share price increased to $2.91 per share. At approximately 12:50 p.m., NEDEV received email confirmation that the Euroins Press Release had been released and immediately began selling shares of Tower Group held in the Strategic Accounts. In total, on or about May 13, 2014, NEDEV caused the Strategic Accounts to sell approximately 90,000 shares of Tower Group for a gain of approximately $26,100. When Euroins received questions from investors on the day the Euroins Press Release was released, the questions were routed to NEDEV via email. NEDEV did not advise the Eurohold Chairman or anyone at Euroins that he sold Tower Group stock after the Tower Offer was made.
Two days later, on or about May 15, 2014, Tower Group issued a press release acknowledging receipt of the Euroins Letter of Intent but announcing that Tower Group’s Board of Directors had unanimously determined that Euroins’s proposal “[did] not constitute and could not reasonably be expected to lead to a superior proposal” to the contemplated merger with the other insurer.
Finally, in or about June 2015, following media reports that the SEC and the FBI were investigating NEDEV in connection with the Rocky Mountain, Avon, and Tower Group Offers, the Eurohold Chairman met with NEDEV in Sofia, Bulgaria. During their meeting, the Eurohold Chairman confronted NEDEV about his stock holdings in Tower Group at the time NEDEV was advising on a potential acquisition of Tower Group by Euroins. NEDEV acknowledged that he had owned Tower Group stock at the time of the Tower Group Offer and apologized.
* * *
NEDEV, 38, is charged in eight counts. In connection with the Rocky Mountain market manipulation scheme, NEDEV is charged with one count of securities fraud (Count One), one count of wire fraud (Count Two), and one count of aggravated identity theft (Count Three). In connection with the Avon market manipulation scheme, NEDEV is also charged with one count of securities fraud (Count Four), one count of wire fraud (Count Five), and one count of aggravated identity theft (Count Six). In connection with the Tower Group insider trading scheme, NEDEV is charged with one count of fraud in connection with a tender offer (Count Seven) and one count of securities fraud (Count Eight). Counts One, Two, Four, Five, Seven, and Eight each carry a maximum sentence of 20 years in prison. Counts Three and Six, the aggravated identity theft charges, carry a mandatory sentence of two years each, that must be imposed in addition to the sentence imposed on other counts. The charges also carry a maximum fine of $5 million, or twice the gross gain or loss from the offense.
The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Bharara praised the work of the FBI, and thanked the SEC Division of Enforcement and Office of Inspector General for their assistance. Mr. Bharara also thanked the Office of International Affairs and Bulgarian law enforcement for their assistance in the arrest and apprehension of NEDEV.
The charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorney Andrea M. Griswold is in charge of the prosecution.
The allegations contained in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth herein constitute only allegations, and every fact described should be treated as an allegation.
Broward County Resident Convicted of Illegally Possessing a Firearm and AmmunitionRead the Press Release
A Broward County resident was convicted today by a jury in federal court for being a felon in possession of a firearm and ammunition.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, Carlos Canino, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Miami Field Division, and Scott Israel, Sheriff, Broward Sheriff’s Office (BSO), made the announcement.
Derek Danard Slade, 25, of Hollywood, was convicted, following a four-day jury trial before U.S. District Judge William P. Dimitrouleas, of being a felon in possession of a firearm and ammunition. Slade faces a maximum sentence of up to 10 years in federal prison for the crime of conviction. Slade is scheduled to be sentenced by Judge Dimitrouleas on May 20, 2016, at 1:45 p.m. in Fort Lauderdale.
According to evidence presented at trial, a deputy with the Broward County Sheriff’s Office observed a “hand-to-hand” narcotics transaction take place in a vehicle in the area of Dania Beach. In addition to Slade, the vehicle had three other occupants. After being stopped by law enforcement, Slade refused to show his hands to the deputies and kept them hidden under a hat. The other occupants of the vehicle complied with law enforcement’s directives. Once he finally complied with the deputy’s orders, Slade was handcuffed. After he was handcuffed, Slade broke away from the deputies and fled the scene on foot. Slade was eventually apprehended and deputies located, under the hat in the vehicle, a .380 caliber Beretta firearm, fully loaded with fourteen rounds of .380 caliber ammunition.
This case is, in large part, the result of the Violence Reduction Partnership, launched by the U.S. Attorney’s Office. Through this Partnership, the U.S. Attorney’s Office and its federal and local law enforcement allies have sought to dismantle the most violent criminal networks in various neighborhoods, while simultaneously working with community leaders and concerned citizens to mentor at-risk youths, provide jobs and job training to young families, and help probationers and parolees successfully re-enter society.
Mr. Ferrer commended the investigative efforts of ATF and BSO. The case is being prosecuted by Assistant U.S. Attorneys Rosa Rodriguez-Mera and Randy Katz.
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.
British Man Indicted for Wire Fraud, Identity Theft and Money Laundering That Victimized Hundreds of Thousands Across United StatesRead the Press Release
A British man living in Las Vegas, Nevada, was indicted by a Nevada grand jury for withdrawing money from the bank accounts of hundreds of thousands of victims without authorization, Principal Deputy Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division and Acting Inspector in Charge Daniel Brubaker of the U.S. Postal Inspection Service– Criminal Investigations announced today.
Gareth David Long, 37, is charged in a 39-count indictment with wire fraud, aggravated identity theft and money laundering. The indictment alleges that Long, operating through his company, V Internet Corp LLC, deposited unsigned remotely created checks (RCCs aka demand drafts) drawn on the accounts of hundreds of thousands of unwitting account holders. Although Long had no authorization to charge the accounts, he represented to his victims’ banks that the victims had authorized the debits. Long used the proceeds of his fraud scheme to purchase airplanes, vehicles, farm equipment and other property.
“Gareth David Long abused the sensitive personal and financial information of hundreds of thousands of Americans in a brazen scheme to steal millions of dollars from unwitting account holders,” said Principal Deputy Assistant Attorney General Mizer. “As this case makes clear, we will investigate and pursue charges against individuals who abuse the financial information of American consumers.”
“American consumers expect e-commerce providers will protect their sensitive financial information,” said Acting Inspector in Charge Brubaker. “Mr. Long betrayed that trust for his own self-interest. With this case, Postal Inspectors continue their long history of protecting consumers by demonstrating our protection of e-commerce transitions extend beyond the stamp.”
According to the indictment, from 2008 through 2013, Long operated a third-party payment processing company, V Internet Corp, which also did business as “Altcharge” and “Check Process.” As a payment processor, Long specialized in the creation and deposit of RCCs. A RCC is a check created not by the account holder but by the third-party payee. In place of a signature, a RCC contains a typed statement claiming that the check was authorized by the account holder. On behalf of his merchant clients, Long created and deposited RCCs drawn on the bank accounts of American consumers. Because of this payment processing activity, Long possessed the personal and financial information of hundreds of thousands of consumers whose accounts had been debited by Long’s merchants.
In January 2013, Long allegedly created the facade that he was operating an Internet merchant business matching consumers with online payday loans. He registered the websites www.fastloanfast.com, www.loan4utoday.com and www.fastloan4me.com, which purported to help consumers find online payday loans. From January through July 2013, Long allegedly deposited hundreds of thousands of RCCs, each for $30 and each of which stated that the account holder had authorized a payment to Long’s company.
The indictment alleges that, in reality, Long simply debited the accounts of victims who had never visited his websites, never requested any service and never authorized any payment. Long obtained the personal and financial information of his victims from two sources. First, he allegedly purchased large spreadsheets, referred to as “lead lists,” each of which contained detailed personal and financial information of thousands of American consumers. Second, Long used the data stored in his payment processing system to debit more than a hundred thousand accounts that had previously been debited by Long’s prior merchants. When he ran out of unique accounts to charge, Long allegedly created and deposited hundreds of thousands of additional, repeat charges against accounts he had already charged.
By the time Long’s scheme ended in July 2013, he allegedly had created and deposited more than 750,000 RCCs totaling more than $22 million. Approximately 50 percent of the RCCs were returned by account holders’ banks. Many RCCs were returned because the account holder saw the debit and realized that an unauthorized charge was being imposed on his or her account. Other RCCs were returned because they were drawn on accounts that were nonexistent, closed or did not contain sufficient funds to cover the debit. As alleged in the indictment, many victims did not notice the charge and therefore did not dispute it.
The Department of Justice’s Consumer Protection Branch uncovered Long’s fraudulent activity in connection with an investigation of Long’s bank, CommerceWest Bank. Based upon its conduct in processing unauthorized transactions for Long, CommerceWest Bank entered into a civil and criminal settlement with the Department of Justice.
The U.S. Postal Inspection Service seized more than $2.9 million from V Internet’s accounts at CommerceWest Bank. Postal Inspectors also seized property that Long purchased with the proceeds of his fraudulent activity, including five airplanes, a Land Rover, a Dodge Charger, multiple tractors, five all-terrain vehicles and a fire truck. In addition, the criminal indictment seeks forfeiture of a house and other property Long purchased in Cedar Hill, Texas.
The case is being handled by Trial Attorney John W. Burke and Ehren Reynolds of the Civil Division’s Consumer Protection Branch in coordination with Assistant U.S. Attorneys Crane M. Pomerantz and Daniel D. Hollingsworth of the U.S. Attorney’s Office for the District of Nevada and with substantial investigative support from the U.S. Postal Inspection Service.
For more information about the Consumer Protection Branch, visit its website at http://www.justice.gov/civil/consumer-protection-branch.
Boston Interagency Committee on Violence Prevention Announces Boston’s 3rd Annual National Youth Violence Prevention Week EventsRead the Press Release
BOSTON – The Boston Interagency Committee on Violence Prevention will host events and competitions for young people in the Boston community in recognition of National Youth Violence Prevention Week, April 4-8, 2016.
“I’m thrilled to once again be a part of this event, which showcases how young people channel their incredible talents to resist and prevent violence in their schools and communities,” said United States Attorney Carmen M. Ortiz. “Each year, I’m awed by the strength of Boston’s young people to stand up for peace and defend their right to violence-free communities. With the activism and advocacy that youth have been demonstrating, I’m sure this year will be no different!”
National Youth Violence Prevention Week aims to raise awareness and to educate young people, parents, and communities as a whole, about effective ways to prevent and reduce youth violence. The campaign, which is held in cities across the country, features activities, competitions and events that bring young people together to make their schools and communities safer by using peaceful forms of self-expression.
DJs from JAM’N 94.5 will host a city-wide Peace Rally at the Reggie Lewis Center at Roxbury Community College on April 7th from 5:30 to 7:30 pm, which will be the highlight of the week. At the rally, the winners of the anti-violence themed contests for Boston students will be announced, and the Floorlords, Vine Street Dancers, and Seekers of Knowledge dance groups will perform. There will also be surprise audience-participation contests with prizes, and guest-appearances by top officials. Over 500 people attended the 2015 Peace Rally.
The Boston Interagency Committee on Violence Prevention recently announced the creative anti-violence themed contests in schools and community centers. Boston students in grades K-5 will submit posters with a theme of “Youth Standing STRONG Against Violence;” grades 6-8 will enter poetry with the same theme; and high school students are invited to create hip-hop music videos with an anti-violence message.
Prizes for the top three entries in each category include Target gift cards, Red Sox tickets, and a spotlight on JAM’N 94.5’s “Saturday Night Jump Off.” Sponsoring agencies will also receive Staples gift cards in recognition of their support.
Another event taking place in Boston during National Youth Violence Prevention Week will be held at the Umana Barnes Middle School in East Boston on April 4th. The U.S. Attorney’s Office and the Suffolk County District Attorney’s Office will team up to present a combined program encouraging positive decision-making and alternatives to violence.
The Boston Interagency Committee on Violence Prevention consists of representatives from the U.S. Attorney’s Office, the Office of the Governor of Massachusetts, the Massachusetts Attorney General’s Office, Suffolk County District Attorney’s Office, Suffolk County Sheriff’s Department, City of Boston Mayor’s Office, Boston Police Department and Boston Centers for Youth & Families.
Sponsors of the event include JAM’N 94.5 Radio, Roxbury Community College, MassHousing, Crystal Rock Beverages, Boston Police Athletic/Activities League and the Youth Violence Prevention Funders Learning Collaborative.
For further information, visit www.cityofboston.gov/bcyf/programs and click on “Youth Standing Strong Against Violence,” or send an email to [email protected].
Albuquerque Man Sentenced to Seven Years for Stealing Prescription Painkillers and Brandishing Firearm During Robbery of Retail PharmacyRead the Press Release
ALBUQUERQUE – Eddie Gallegos, 39, of Albuquerque, N.M., was sentenced today in federal court for his conviction on theft of medical products and firearms charges arising out of the armed robbery of an Albuquerque-area retail pharmacy in June 2013. Gallegos was sentenced to 84 months in federal prison followed by three years of supervised release.
Gallegos was arrested in June 2015, on an indictment charging him with violating the Hobbs Act by robbing a business engaged in interstate commerce, using and carrying a firearm during a crime of violence, violating the Safe Doses Act by stealing medical products, and possession of Oxycodone with intent to distribute. The charges against Gallegos arose out of the robbery of Phil’s Pills, a retail pharmacy in Albuquerque, on June 21, 2013.
On Dec. 1, 2015, Gallegos pled guilty to brandishing a firearm in furtherance of a crime of violence and violating the Safe Doses Act by stealing medical products. In entering his guilty plea, Gallegos admitted that on June 21, 2013, he entered the pharmacy called Phil’s Pills located at 5510 Lomas Blvd. in Albuquerque, pointed a firearm at an employee and the store owner, and demanded they fill his backpack with Oxycodone, OxyContin and Fentanyl. After the store owner complied with his demand, Gallegos fled the scene.
This case was investigated by the Albuquerque office of the FBI, the Tactical Diversion Squad of the DEA in Albuquerque and the Albuquerque Police Department. Assistant U.S. Attorneys Joel R. Meyers and Shaheen P. Torgoley prosecuted the case.
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.
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.
This case was 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.
Albuquerque Felon Pleads Guilty to Violating Federal Firearms Laws and the Hobbs ActRead the Press Release
ALBUQUERQUE – Vincent Steven Martinez, 38, of Albuquerque, N.M., pleaded guilty late yesterday afternoon in federal court to violating the Hobbs Act by robbing a commercial business involved in interstate commerce and being a felon in possession of firearms and ammunition. He also acknowledged violating the terms of his supervised release on a previous felony conviction. Under the terms of his plea agreement, Martinez will be sentenced to 139 months in federal prison followed a term of supervised release to be determine by the court.
The sentence was announced by U.S. Attorney Damon P. Martinez, Special Agent in Charge Terry Wade of the FBI’s Albuquerque Division and Bernalillo County Sheriff Manuel Gonzales, III.
Martinez was arrested on Dec. 4, 2015, on an indictment charging him with being a felon in possession of a firearm and ammunition on Sept. 15, 2015, in Bernalillo County, N.M. The indictment was subsequently superseded on Jan. 14, 2016, to include charging Martinez with violating the Hobbs Act on Sept. 12, 2015, by robbing a business engaged in interstate commerce in Bernalillo County. At the time, Martinez was prohibited from possessing firearms or ammunition because he previously had been convicted of aggravated battery, armed bank robbery and bank robbery.
During yesterday’s proceedings, Martinez pled guilty to the superseding indictment. Martinez also entered a guilty plea a petition charging him with violating the terms of his supervised release on a prior felony conviction for use of a controlled substance and possession of a firearm. In pleading guilty to the superseding indictment, Martinez admitted robbing three businesses in addition to the business identified in the superseding indictment. To that end, Martinez admitted the following criminal conduct:
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On Aug. 14, 2015, Martinez entered the Valero gas station at 1715 Moon Street in Albuquerque, pointed a gun at and threatened the cashier and stole cash and cigarettes before fleeing the store.
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On Sept. 5, 2015, Martinez entered the Holiday Inn at 4501 Alameda Blvd. in Albuquerque, showed the hotel employee a knife and demanded money, stole cash and a camera and fled.
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On Sept. 10, 2015, Martinez entered the La Quinta Inn at 5241 San Antonio Dr. in Albuquerque, pointed a gun at and threatened a hotel employee, took money and fled.
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On Sept. 12, 2015, Martinez entered the Family Dollar at 7900 Second St. in Albuquerque, showed the cashier a gun and demanded money.Martinez admitted that, as he was grabbing money from the cash register at the Family Dollar, he dropped his wallet which had his driver’s license in it.
Martinez was arrested on Sept. 15, 2015, for the Family Dollar robbery. At the time of his arrest, Martinez possessed a firearm and multiple rounds of ammunition. Martinez admitted that prior to his arrest he had been convicted of aggravated battery, armed bank robbery and bank robbery. He admitted violating the conditions of his supervised release by committing the aforementioned robberies and by possessing the firearm and ammunition.
In entering his guilty plea to the supervised release violation, Martinez admitted that on April 28, 2010, he was convicted of armed bank robbery and was sentenced to 71 months of imprisonment followed by three years of supervised release which commenced on June 13, 2014. Martinez admitted that by Jan. 2015, he had failed to submit to drug testing and counseling sessions as required under the conditions of his supervised release and the United States Probation Office filed a petition seeking to revoke his supervised release.
Martinez remains in custody pending a sentencing hearing which has yet to be scheduled.
This case was investigated by the Albuquerque office of the FBI and the Bernalillo County Sheriff’s office. Assistant U.S. Attorney Shana B. Long is prosecuting the case under a federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders primarily based on their prior criminal convictions for federal prosecution with the goal of removing repeat offenders from communities in New Mexico for as long as possible. Because New Mexico’s violent crime rate, on a per capita basis, is one of 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, N.M., under this initiative.
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