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Tuesday 8 March 2016
Chazy Man Pleads Guilty to Making Threats on FacebookRead the Press Release
ALBANY, NEW YORK – Brock Brian Beeman, age 23, of Chazy, New York, pled guilty today to making interstate threats to injure or kill a Plattsburgh-area man.
The announcement was made by United States Attorney Richard S. Hartunian and James C. Spero, Special Agent in Charge of the Buffalo Field Office of Homeland Security Investigations.
In March 2015, Beeman sent threatening communications to a Plattsburgh-area man, by text message and through Facebook. Beeman continued sending these communications even after his victim said he would notify law enforcement if Beeman did not stop.
Beeman faces up to 5 years in prison, a fine of up to $250,000, a term of post-imprisonment supervised release of up to 3 years, and possible restitution to the victim, when he is sentenced on July 13, 2016 by United States District Judge Thomas J. McAvoy. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines, and other factors.
This case was investigated by Homeland Security Investigations and is being prosecuted by Assistant U.S. Attorney Elizabeth Horsman.
Career Offender from Las Cruces Sentenced to Almost Eleven Years for Federal Methamphetamine Trafficking ConvictionRead the Press Release
ALBUQUERQUE – Jennifer Sanders, 43, of Las Cruces, N.M, was sentenced today in federal court in Las Cruces, N.M., to 130 months in prison followed by five years of supervised release for her conviction on methamphetamine trafficking charges. The sentence was announced by U.S. Attorney Damon P. Martinez, Special Agent in Charge Terry Wade of the FBI’s Albuquerque Division, and Lt. Bobby Holden, Commander of the HIDTA Regional Interagency Drug Task Force/Metro Narcotics Task Force.
In announcing the sentence, U.S. Attorney Damon P. Martinez said that Sanders, a career offender whose criminal history includes three prior drug trafficking convictions, was prosecuted 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 Doña Ana County, N.M., under this initiative.
Sanders and her co-defendants, Jose Luis Niño, 41, and Aubrey Savage, 36, of Las Cruces, and Matthew Maley, 48, and Candice Marie Carpenter, 36, of Tucson, Ariz., were charged in a 14-count superseding indictment filed in March 2014. The superseding indictment charged Maley, Sanders and Savage with participating in a conspiracy to distribute methamphetamine in Doña Ana County from June 2013 through Aug. 2013, and Maley, Niño and Carpenter with conspiracy to distribute methamphetamine in Doña Ana County in Dec. 2013. The superseding indictment also charged the defendants with various substantive methamphetamine trafficking offenses, and Maley and Niño were charged with being felons in possession of firearms and ammunition.
Four of the defendants, including Sanders, entered guilty pleas to various counts of the superseding indictment while Maley elected to exercise his right to a jury trial. On Sept. 25, 2014, a jury returned a verdict of guilty against Maley on four methamphetamine trafficking charges and a firearms charge.
The prosecution of the case revealed that Maley was the head of a drug trafficking organization that distributed significant quantities of methamphetamine in New Mexico and Arizona. During July and Aug. 2013, undercover officers made several controlled purchases of methamphetamine from Maley, Sanders and Savage, including the purchase of a pound of methamphetamine on Aug. 21, 2013. From Oct. through Dec. 2013, an informant purchased methamphetamine from Niño, who obtained the methamphetamine from Maley, and on Dec. 4, 2013, officers seized approximately 274 grams of methamphetamine when they executed a search warrant at Niño’s residence in Las Cruces.
On July 18, 2014, Sanders pled guilty to conspiracy and seven counts of distribution of methamphetamine.
Maley was sentenced on Jan. 20, 2016, and was sentenced to 262 months (almost 22 years) in prison followed by ten years of supervised release for his conviction on methamphetamine trafficking and firearms charges.
On June 11, 2014, Savage pled guilty to a conspiracy count, and was sentenced on Feb. 25, 2015, to 60 months in federal prison followed by four years of supervised release.
On July 16, 2014, Niño pled guilty to conspiracy, possession of methamphetamine with intent to distribute, and felon in possession of ammunition. At sentencing, Niño faces a mandatory minimum of ten years in prison and a maximum of life in prison. His sentencing hearing has not yet been scheduled.
On Sept. 18, 2014, Carpenter pled guilty to conspiracy to distribute methamphetamine and distribution of methamphetamine.
This case was investigated by the Las Cruces office of the FBI and HIDTA Regional Interagency Drug Task Force/Metro Narcotics Task Force, and is being prosecuted by Assistant U.S. Attorney Maria Y. Armijo of the U.S. Attorney’s Las Cruces Branch Office.
The HIDTA Regional Interagency Drug Task Force/Metro Narcotics Task Force is comprised of officers from the Las Cruces Police Department, the Doña Ana County Sheriff’s Office, the FBI, HSI and the New Mexico State Police. The High Intensity Drug Trafficking Areas (HIDTA) program was created by Congress with the Anti-Drug Abuse Act of 1988. HIDTA is a program of the White House Office of National Drug Control Policy (ONDCP) which provides assistance to federal, state, local and tribal law enforcement agencies operating in areas determined to be critical drug-trafficking regions of the United States and seeks to reduce drug trafficking and production by facilitating coordinated law enforcement activities and information sharing.
Buffalo Man Pleads Guilty to Marijuana ChargeRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that Keith Goss, 47, of Buffalo, NY, pleaded guilty to attempted possession with intent to distribute 100 kilograms or more of marijuana before U.S. District Judge Richard J. Arcara. The charges carry a minimum penalty of five years in prison, a maximum of 40 and a $5,000,000 fine.
Assistant U.S. Attorney Thomas S. Duszkiewicz, who is handling the case, stated that on June 12, 2013, the defendant attempted to take possession of a crate which was to be delivered to an address on Fillmore Avenue in Buffalo after being shipped from Tucson, Arizona. The crate contained 315 pounds of marijuana valued in excess of $250,000. Law enforcement officers intercepted the crate of marijuana before it was delivered to the Fillmore Avenue address where the defendant was awaiting its arrival with his two sons. Goss had asked his sons, who were not aware of its contents, to pick up the package.
The plea is the culmination of an investigation on the part of Special Agents of the Drug Enforcement Administration, under the direction of James J. Hunt, Special Agent in Charge, New York Field Division and the Tonawanda Police Department, under the direction of Jerome C. Uschold III, with the assistance of the DEA Office in Nogales, Arizona.
Sentencing is scheduled for June 13, 2016 at 1:00 p.m. before Judge Arcara.
Brother and Sister Plead Guilty to Rico ConspiracyRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that Dewayne Gray, 31, aka Whip, and Erika Gray, 34, aka Tek, both of Buffalo, NY, pleaded guilty before U.S. District Judge Richard J. Arcara, to RICO conspiracy. In addition, Erika Gray pleaded guilty to conspiracy to possess with intent to distribute crack cocaine. Dewayne Gray faces a maximum penalty of life in prison and a $2,500,000 fine. Erika faces a mandatory minimum penalty of 10 years in prison, a maximum of life and an $8,000,000 fine.
“This represents yet another instance where this office used racketeering charges to completely decimate a violent street gang,” said U.S. Attorney Hochul. “This office will continue to target such gangs until they are a thing of the past.”
Assistant U.S. Attorneys Thomas S. Duszkiewicz and Joel L. Violanti, who are handling the case, stated that between 2009 and January 23, 2012, Dewayne Gray was the leader of the LRGP gang, which operates primarily in the area of Lombard, Rother, Playter and Gibson Streets in the City of Buffalo. It is alleged to be an organization engaged in violent criminal activity, including the distribution of cocaine and crack cocaine and the use of firearms. Erika Gray was an associate of the gang.
As leader of the LRGP Gang, Dewayne Gray organized and managed gang members, and the narcotics distribution and sales. Dewayne Gray maintained 42 Memorial Drive and 29 Meyers Street in Buffalo for the purpose of manufacturing and distributing crack cocaine.
As an LRGP associate, Erika Gray participated in the distribution and crack cocaine and the racketeering activities of the gang. She was arrested in 2012 and released from custody but continued to distribute crack cocaine with other gang members out of residences on Houghton and Warren Avenues in Buffalo.
The plea is the result of an investigation by the Federal Bureau of Investigation Safe Streets Task Force, under the direction of Special Agent in Charge Adam S. Cohen, the Drug Enforcement Administration, under the direction of Special Agent in Charge James J. Hunt, New York Field Office, the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Delano A. Reid, New York Field Office and the Buffalo Police Department, under the direction of Commissioner Daniel Derenda.
Erika Gray is scheduled to be sentenced on June 15, 2016 at 12:30 p.m. Dewayne Gray will be sentenced on July 18, 2016 at 12:30 p.m., both before Judge Arcara.
Bristol Man Indicted on Federal Tax ChargesRead the Press Release
ABINGDON, VIRGINIA – A federal grand jury sitting in the United States District Court for the Western District of Virginia in Roanoke has charged a Bristol, Virginia man with a variety of federal tax charges, United States Attorney John P. Fishwick Jr. announced today.
In an indictment returned under seal on March 3, 2016 and unsealed today following the defendant’s initial court appearance in District Court, the grand jury has charged Charles Doughty Sewell, 65, of Bristol, Va., with one count of impending or impairing the due administration of the Internal Revenue Service and four counts of tax perjury.
According to the indictment, Sewell resided in Bristol, Virginia, earned income and was provided W-2 forms by his employer. On January 2, 2010, a Final Judgment of Permanent Injunction against Sewell was entered in the United States District Court for the Western District of Virginia in Abingdon. The judgment was entered as a result of a stipulation between Sewell and the United States and permanently enjoined the defendant from engaging in any activity subject to penalty under the Internal Revenue Code and any conduct that interferes with the administration and enforcement of the internal revenue law.
The indictment alleges that between July 2010 and February 2015, Sewell did impede the due administration of the Internal Revenue Code by filing false tax returns and engaging in conduct, the likely effect of which was to mislead and to conceal income from the Internal Revenue Service.
The investigation of the case was conducted by the Internal Revenue Service. Assistant United States Attorney C. Patrick Hogeboom III will prosecute the case for the United States.
Blue Springs Man Sentenced for Amassing Thousands of Child Porn ImagesRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Blue Springs, Mo., man was sentenced in federal court today for downloading thousands of images and videos of child pornography, which he made available to share over the Internet.
Randall R. Brooks, 58, of Blue Springs, was sentenced by U.S. District Judge Dean Whipple to five years in federal prison without parole.
On Oct. 19, 2015, Brooks pleaded guilty to distributing child pornography over the Internet.
An FBI task force officer was conducting an investigation in January 2014 into computers that had been identified as possibly sharing images of child pornography through a peer-to-peer file-sharing network. The officer downloaded multiple videos of child pornography from Brooks’s computer. Officers executed a search warrant at Brooks’s residence on March 14, 2014, and seized a desktop computer, a laptop computer and five hard drives.
Brooks admitted to investigators that he searched for and downloaded images of child pornography over the Internet. He also admitted that his computer shared those images through a peer-to-peer file-sharing network.
Examiners found approximately 1,324 photos and 387 videos that contained child pornography on Brooks’s computer. A recurring theme in many of the images and videos in his collection was the graphic depiction of the rape and sodomy of prepubescent boys and girls, some as young as toddlers, by adult men. Images found in Brooks’s collection also included adults engaging in sexual acts with physically restrained prepubescent minors as well as depictions of minors engaging in bestiality.
According to court documents, Brooks also engaged in online fantasy chats with what appeared to be minor children or adults posing as minor children.
This case was prosecuted by Assistant U.S. Attorney David Luna. It was investigated by the FBI Cyber Crimes Task Force and the Blue Springs, Mo., Police Department.
Bessemer Grocer Pleads Guilty to $5 million Food Stamp Fraud, Tax Evasion, Money Laundering and Currency StructuringRead the Press Release
BIRMINGHAM – A Bessemer grocery store owner pleaded guilty today in federal court to defrauding the food stamp program of more than $5 million, structuring cash transactions and laundering money to hide the illegal profit, and evading federal income taxes, announced U.S. Attorney Joyce White Vance, IRS Criminal Investigation Special Agent in Charge Veronica Hyman-Pillot and U.S. Department of Agriculture Office of Inspector General, Investigations, Special Agent in Charge Karen Citizen-Wilcox.
HASAN F. AHMED, 50, owner and operator of Associated Discount Foods on Ninth Street South in Bessemer, pleaded guilty before U.S. District Judge R. David Proctor to one count each of food stamp fraud, tax evasion and structuring currency transactions and four counts of money laundering. As part of his plea, Ahmed agreed to forfeit $5.2 million to the government as proceeds of his illegal activity, including his interest in $375,027 which the government already has seized from the grocery store and four bank accounts. Ahmed’s sentencing date has not been set.
“The SNAP program provides assistance for those who need help to feed themselves or their families. It is not an open pocketbook for criminals to abuse in order to selfishly enrich themselves,” Vance said. “This was not a victimless crime. Instead of fulfilling his obligations, Mr. Ahmed used his position to defraud $5 million from a taxpayer-funded program.”
“Hasan Ahmed made an illegal profit by taking advantage of a benefit program,” Hyman-Pillot said. “His actions were a direct misuse of tax dollars. IRS Criminal Investigation and our law enforcement partners will work aggressively to uncover similar schemes and return the illicit proceeds back to the United States Government.”
“Ahmed’s plea should serve as a warning to all stores that participate in the Supplemental Nutrition Assistance Program as vendors that fraud and trafficking of EBT benefits, which is purchasing those benefits for cash, will be vigorously investigated and prosecuted by the USDA-Office of Inspector General, the U.S. Attorney’s Office, and all of its federal, state and local partners that have a stake in ensuring that fraud is eliminated from taxpayer-funded programs,” Citizen-Wilcox said.
Associated Discount Foods is a mid-sized neighborhood grocery store that was authorized by the USDA to accept SNAP food stamp benefits.
From January 2007 through December 2010, the store’s average monthly SNAP redemptions were $4,196, increasing to $17,457 in January 2011, according to Ahmed’s plea agreement with the government. By April 2011, the store’s monthly SNAP redemptions surpassed the average monthly redemptions of five other medium-sized grocery stores within a 14-mile area, according to the plea agreement.
“Based on ADF’s total SNAP redemptions and comparison analysis, the defendant acquired an estimated $5,243,866.49 in SNAP benefits from July 2011 through June 2014 in a way that was contrary to law,” the plea agreement states. Ahmed’s redemptions rose dramatically because he illegally swapped food stamps for cash, at less than the stamps’ face value, and allowed customers to purchase ineligible items with food stamp benefits at inflated rates, according to the document.
Ahmed evaded taxes on the illegal income when he filed a federal income tax return for the 2013 tax year claiming total income of $24,728 when his actual income was $210,927, according to his plea.
Ahmed’s plea agreement outlines his money laundering and illegal currency structuring as follows:
Ahmed controlled a BB&T checking account opened in the name of a relative, identified in court documents as R.N. Between June 2013 and June 2014, in four separate transactions, he deposited $58,100 in proceeds of his food stamp fraud into R.N.’s account. Ahmed moved money into R.N.’s account from his grocery store’s business accounts, where SNAP benefits were electronically deposited, to conceal or disguise that the money was the product of his food stamp fraud.
Ahmed illegally structured financial transactions in an Associated Discount Foods business account at BB&T, making two withdrawals of $10,000 and 36 withdrawals ranging from $9,200 to $9,900, for a total of $362,900, between January and May of 2013. After a bank teller informed Ahmed that transactions over $10,000 had to be reported, he made no further currency transactions over that amount.
Financial institutions are required by law to report currency transactions above $10,000 to the U.S. Department of Treasury. “The defendant engaged in these transactions to evade the reporting requirement” on the 38 withdrawals, according to Ahmed’s guilty plea.
The maximum penalty for both food stamp fraud and tax evasion is five years in prison and a $250,000 fine. The maximum penalty for money laundering is 20 years in prison and a $500,000 fine or twice the value of the property involved in the transaction, whichever is greater. The maximum penalty for currency structuring is 10 years in prison and a $500,000 fine.
IRS-CI and USDA-OIG investigated the case, which Assistant U.S. Attorneys Erica Williamson Barnes and Daniel Fortune are prosecuting.
Bergen County, New Jersey, Doctor Charged with Taking BribesRead the Press Release
NEWARK, N.J. – A family doctor practicing in Bergen County, New Jersey, was charged today with accepting bribes in exchange for test referrals as part of a long-running and elaborate scheme operated by Biodiagnostic Laboratory Services LLC (BLS), of Parsippany, New Jersey, its president and numerous associates, U.S. Attorney Paul J. Fishman announced.
Bernard Greenspan, 78, of Saddlebrook, New Jersey, was indicted by a federal grand jury in Newark. The 10-count indictment charges Greenspan with one count of conspiring to commit violations of the Anti-Kickback Statute, the Federal Travel Act and wire fraud; three substantive violations of the Anti-Kickback Statute; three substantive violations of the Federal Travel Act; and three substantive violations of wire fraud. Greenspan will be arraigned at a later date.
“The charges contained in the indictment allege an extremely lucrative pattern of soliciting and accepting illegal payments for referrals to a specific testing lab,” said U.S. Attorney Fishman. “This indictment is part of our continued commitment to prosecute those physicians who sought to enrich themselves through their involvement in the BLS bribery scheme.”
“The FBI, in conjunction with our law enforcement partners, the U.S. Department of Health and Human Services’ Office of Inspector General, the Internal Revenue Service, and the U.S. Postal Inspection Service, will continue to investigate allegations of fraud and kickback schemes that undermine the integrity of our health care system," stated Acting Special Agent in Charge Andrew Campi. "We urge anyone aware of this type of illegal activity to contact the FBI.”
“This indictment is another reminder that kickbacks in connection with federal health care programs are illegal and unacceptable,” said Scott J. Lampert, Special Agent in Charge, Office of Inspector General, U.S. Department of Health and Human Services. “Taking such payments subverts the notion that patients should come before profits.”
To date, 39 people – 26 of them doctors – have pleaded guilty in connection with the bribery scheme, which its organizers have admitted involved millions of dollars in bribes and resulted in more than $100 million in payments to BLS from Medicare and various private insurance companies. It is believed to be the largest number of medical professionals ever prosecuted in a bribery case. The investigation has recovered more than $11.5 million through forfeiture.
According to the indictment:
Between March 2006 and April 2013, Greenspan received approximately $200,000 in bribes from BLS employees and associates. Greenspan periodically solicited, and received from the BLS employees and associates, monthly bribe payments in the form of sham rental, service agreement, and consultant payments. Greenspan solicited and received other bribes, including payment for holiday parties for Greenspan and his office staff. BLS hired – at Greenspan’s specific request – a patient of Greenspan’s with whom he was having a sexual relationship. Greenspan’s referrals generated approximately $3 million in lab business for BLS.
Greenspan is the second physician to be indicted in connection with the BLS bribery scheme. Brett Ostrager was indicted on Aug. 11, 2015, and pleaded guilty on Dec. 22, 2015, after his motion to dismiss the indictment was denied by Judge Chesler. He is awaiting sentencing.
Each of the Anti-Kickback and Federal Travel Act counts carries a maximum potential sentence of five years in prison; each of the wire fraud counts carries a maximum potential penalty of 20 years in prison. All of the counts carry a maximum $250,000 fine, or twice the gross gain or loss from the offense.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Acting Special Agent in Charge Andrew Campi; inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge Maria L. Kelokates; IRS–Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen; and HHS-OIG Special Agent in Charge Lampert.
The government is represented by Assistant U.S. Attorneys Joseph N. Minish and Danielle Alfonzo Walsman, and Jacob T. Elberg, Chief of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark, as well as Assistant U.S. Attorney Barbara Ward, Acting Chief of the office’s Asset Forfeiture and Money Laundering Unit.
U.S. Attorney Paul J. Fishman reorganized the health care fraud practice at the New Jersey U.S. Attorney’s Office shortly after taking office, including creating a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since 2010, the office has recovered more than $1.29 billion in health care fraud and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Food, Drug and Cosmetic Act and other statutes.
Defense counsel: Damian Conforti Esq., Newark, NJ
Behr Iron & Steel Inc. Pleads Guilty to OSHA Violation Causing Death of EmployeeRead the Press Release
ROCKFORD — A Rockford-based company pleaded guilty today before U.S. Magistrate Judge Iain D. Johnston to willfully violating Occupational Safety and Health Administration regulations, resulting in the death of an employee at the company’s facility in South Beloit, Ill.
BEHR IRON & STEEL INC., a high volume ferrous and nonferrous scrap processor, admitted in a plea agreement that on March 10, 2014, the company failed to provide lockout/tagout protection and confined space protection as required under OSHA regulations for the company’s employees who were cleaning a shredder discharge pit. The company admitted that those violations caused the death of an employee who got caught in a moving, unguarded conveyor belt.
The Company faces a maximum sentence of 5 years’ probation, a maximum fine of $500,000, and restitution to the victim employee in an amount determined by the Court. Sentencing is scheduled for July 12, 2016, at 1:30 p.m.
The guilty plea was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and Ken Nishiyama Atha, Regional Administrator of OSHA in Chicago.
“Justice cannot restore life to the victim whose body was crushed because Behr Iron and Steel failed to provide protection from dangerous machinery on the job,” said Mr. Atha. “Safety training at the plant was woefully insufficient. Behr must be held responsible by the courts for ignoring safety standards and failing in its obligation to protect its workers on the job.”
Behr’s South Beloit facility recycles metals contained in such things as automobiles and refrigerators. According to the plea agreement, OSHA regulations require employers to adopt safety procedures to ensure that dangerous machines are properly shut off and unable to start up again prior to the completion of maintenance or servicing work. The safety procedures include placing a lock on the power source of the machine and a tag on the lock warning that the machine cannot be operated until the warning is removed, and identifying the employee who has the key to the lock. OSHA also promulgated regulations that address the need to protect employees from entering a confined space without safety precautions.
Metals shredded through a shredding machine in Behr’s South Beloit facility fall onto a conveyor belt located about ten feet underground in a shredder discharge pit, which was approximately six feet long and six feet wide. The shredded materials were then moved by a conveyor belt out of the discharge pit and through a sorting process. Some of the shredded metals fall onto the ground of the discharge pit near the conveyor belt. One or two Behr employees working on the shredding machine were required to clean the discharge pit on a daily basis. The employees shoveled shredded materials from the floor of the discharge pit onto the running conveyor belt.
On March 10, 2014, a Behr employee was cleaning the discharge pit when the employee’s arm was caught by the unguarded conveyor belt. The employee was pulled into the machinery and killed.
Behr admitted that there was no lock or operable emergency shut off switch in the discharge pit for the conveyor belt, and the conveyor belt did not have guards designed to protect employees. Behr also admitted that employees in the discharge pit were not adequately trained to use the shredder or the conveyor belt, and that the company had not developed and implemented confined space protection for employees entering the discharge pit.
The government is represented by Assistant U.S. Attorney Scott R. Paccagnini.
Plea Agreement
Bar Owner Convicted of Tax EvasionRead the Press Release
A bar owner who admitted to filing false tax returns pled guilty today in federal court in Cedar Rapids.
Bradley Tischer, age 51, from Atkins, IA, was convicted of one Count of Tax Evasion.
At the plea hearing, Tischer admitted in a plea agreement that he evaded taxes from 2009-2013, knowing the returns were false as to his reportable income.
Tischer owned and operated three bars and grills known as Brogan’s, Miguel’s and Bobby T’s. He also had a corporation known as JGT, Inc., which were used to operate Miguel’s and Bobby T’s. Tischer underpaid his taxes from 2009-2013 in the amount of approximately $357,172. Each tax return contained a written declaration that it was signed under the penalty of perjury. Tischer knew he had not reported funds taken from Brogan’s and JGT, Inc. which were used for his own benefit.
Sentencing will be set after a presentence report is prepared. Tischer was released pending sentencing. Tischer faces a maximum penalty of not more than 5 years imprisonment without the possibility of parole; a fine of not more than $100,000; a mandatory assessment of $100; costs of prosecution; and a term of supervised release of up to one year.
The case is being prosecuted by Assistant United States Attorney Matthew J. Cole and was investigated by Internal Revenue Service-Criminal Investigation.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 16-cr-16.
Follow us on Twitter @USAO_NDIA.
Austin Lawyer Sentenced in Relation to “Butch” Ballow Case and Stock Sale SchemeRead the Press Release
HOUSTON – Patrick Lanier, 67, of Austin, has been ordered to federal prison following his convictions on 16 counts to include one count of harboring and concealing Harris “Butch” Ballow from arrest, announced United States Attorney Kenneth Magidson. A jury convicted Lanier Feb. 27, 2014, of conspiracy to commit wire fraud arising from a stock sale scheme, 13 counts of wire fraud, one count of harboring and concealing Ballow from arrest and one count of assisting a federal offender.
At a hearing that concluded last night, U.S. District Judge Lee Rosenthal, who presided over the trial, handed Lanier a total sentence of 17 years in federal prison and further ordered him to pay $37 million in restitution. At the hearing, the judge noted the large number of victims - more than 500 - and acknowledged that one victim reported her husband committed suicide as a result of this offense. Previously released on bond, the court ordered he be immediately taken into custody following the hearing.
Lanier is an Austin attorney who represented Ballow during proceedings before the Securities and Exchange Commission (SEC) in 2004 and also during the criminal case that led to Ballow becoming a fugitive. While a fugitive, Ballow controlled a corporation used to bilk hundreds of investors, many of whom lived in Canada, out of millions of dollars. Lanier served as a lawyer for that corporation.
Evidence demonstrated at the 13-day trial, proved Lanier assisted Ballow in selling shares of stock in public companies acquired and controlled by Ballow while he was a fugitive from justice. Assisted by Lanier, Ballow and co-conspirators sold stock to unsuspecting investors by hiding Ballow’s true identity, disseminating false and misleading information to increase and maintain the value of stock, failing to fulfill promises to remove restrictions which prevented investors from selling the stock and selling land and ownership interests in a real estate development that never materialized.
Ballow was a fugitive from justice in the United States for more than five years. He was indicted in federal court in Houston in 2003 for fraud and money laundering which centered on misrepresentations made in connection with the purchase and sale of stock. Ballow pleaded guilty before U.S. District Judge David Hittner to money laundering in November 2003 and faced a maximum of 10 years imprisonment. At the time, Ballow, who had been in custody without bond for approximately a year, agreed to cooperate with an SEC investigation and was released on a $100,000 bond pending his sentencing. On Dec. 16, 2004, the day of sentencing, Ballow failed to appear and a warrant was soon issued for his arrest. Ballow was arrested by Mexican authorities on July 13, 2010, in Nuevo Vallarta, Mexico, and extradited by Mexico to the United States on April 8, 2011. He was later sentenced to 10 years for money laundering and ordered to pay $10 million in restitution.
According to evidence presented in Lanier’s trial, Ballow lived under the names John Gel, Tom Brown and Marty Twinley during his time as a fugitive and also acquired a British passport in the name of Melvyn John Gelsthorpe. Ballow used these names to take control of publicly-traded corporations, including E-SOL International Corp., Medra Corp., Deep Earth Resources Inc. and Aztec Technology Partners Inc. (now known as Ultimate Lifestyles Corporation) and sold the stock to investors without revealing his true identity, his use of multiple names, his past convictions for fraud and money laundering and his status as fugitive from justice in the United States. After Ballow fled, Lanier traveled to Mexico to meet him and provided legal work for Ballow under his various false names to consummate Ballow’s fraudulent transactions to bilk investors.
Christopher Harless, 62, of Georgetown, pleaded guilty to one count of conspiracy to commit wire fraud and was sentenced on Nov. 24, 2015, to 20 years in prison. Also on that date, Sikiru Olubunmi Bonojo, 45, a citizen of Nigeria residing in Houston, received a 63-month sentence for laundering proceeds of the fraud scheme. Clarence Hudgens, 59, of Lebanon, Oregon, and James David Wright, 60, of Corinth, both pleaded guilty to the wire fraud conspiracy and are scheduled to be sentenced by Judge Rosenthal on May 5, 2016, while Ruben Garza Perez, 55, a dual U.S.-Mexican citizen formerly of Houston, pleaded guilty to the same charge and is set for sentencing before U.S. District Judge Ewing Werlein Jr. on Aug. 12, 2016. Jeffrey Janssen Anuth, 57, is in custody in Mexico, while the other alleged co-conspirators are considered fugitives.
Ballow, 73, is currently serving his previously-imposed 10-year sentence, but faces additional charges in the form of an 87-count indictment pending before Judge Werlein. He is presumed innocent on that matter unless and until convicted through due process of law.
The case was jointly investigated by the United States Marshals Service and the FBI with substantial assistance of Internal Revenue Service - Criminal Investigation and the U.S. Postal Inspection Service. Valuable assistance was also provided by the Royal Canadian Mounted Police. Assistant U.S. Attorneys John R. Lewis and Belinda Beek are prosecuting the cases.
Attorney General Lynch Discusses Department's Efforts to Protect Consumers from Unsafe Dietary SupplementsRead the Press Release
As part of National Consumer Protection Week, Attorney General Loretta E. Lynch recorded a video to talk about the department’s work protecting the health and safety of consumers from unsafe dietary supplements.
“At the Department of Justice, we are committed to working with our partners across the federal government to protect the health and safety of all Americans,” said Attorney General Lynch. “Recently, we announced a nationwide operation targeting unlawful dietary supplements. We are bringing civil and criminal cases against more than 100 makers and marketers of supplements who were violating federal law by misrepresenting ingredients; by making unsupported health claims; or even by lacing products with undeclared substances.”
The complete text of the Attorney General’s video message is below:
“Hello. As part of National Consumer Protection Week, I want to take a moment to talk to you about dietary supplements, which are used by millions of Americans every day. What many Americans don’t know is that dietary supplements are not subject to testing by the Food and Drug Administration before they reach store shelves – meaning that every day, millions of Americans are ingesting substances whose safety and efficacy are not guaranteed.
“Some of these supplements are simply a waste of money, promising results they can’t deliver or advertising ingredients that they don’t contain. And too often, these supplements don’t just abuse consumer trust – they also endanger public health. Some contain harmful ingredients, causing consumers to fall ill. Others falsely claim to cure illness and disease, leading patients to use them as a substitute for the proven therapies they need. But whether these supplements are deceptive or dangerous, the fact remains that too many companies are making a profit by misleading – and in some cases harming – American consumers.
“At the Department of Justice, we are committed to working with our partners across the federal government to protect the health and safety of all Americans. Recently, we announced a nationwide operation targeting unlawful dietary supplements. We are bringing civil and criminal cases against more than 100 makers and marketers of supplements who were violating federal law by misrepresenting ingredients; by making unsupported health claims; or even by lacing products with undeclared substances.
“In one case, for example, the Justice Department brought criminal charges against high-ranking executives at USPlabs, a company that sold workout and weight loss supplements. As we alleged, they claimed that their products were made from natural plant extracts, when in fact, they were made from untested synthetic chemicals from China. In several cases, consumers suffered severe liver damage. And although the company was allegedly aware of the risks their product posed, they continued to sell it to consumers, compromising the health and well-being of thousands of Americans.
“The Justice Department is determined to hold bad actors in the dietary supplement industry accountable for their actions. But consumers need to do their part to protect themselves. I urge consumers to be cautious when choosing to take dietary supplements. Visit the FDA and the Federal Trade Commission websites, where you can find useful information about dietary supplements. Use tools developed by the Department of Defense and the U.S. Anti-Doping Agency, including a smartphone app, to help you make informed choices. And above all, if you are considering taking a dietary supplement, talk to a doctor first. Should you and your health care provider decide that dietary supplements are right for you, know that the Department of Justice is working tirelessly to ensure that the products you choose are safely manufactured, accurately labeled, and honestly marketed – because the American people deserve nothing less.”
The full video of the Attorney General’s message is available at https://www.justice.gov/opa/video/national-consumer-protection-week.
For more information about the department’s Consumer Protection Branch, visit http://www.justice.gov/civil/consumer-protection-branch.
Albuquerque Man Sentenced to Federal Prison for Serving as “Lookout” During Armed Robbery of Albuquerque Walmart StoreRead the Press Release
ALBUQUERQUE – Reyes Lujan, 27, of Albuquerque, N.M., was sentenced today in federal court to 71 months in prison for violating the Hobbs Act, by participating in the armed robbery of a Walmart Store in Albuquerque on Oct. 29, 2014. Reyes Lujan will be on supervised release for three years following his incarceration.
Reyes Lujan was arrested on Feb. 9, 2015, on an indictment charging him and five co-defendants with Hobbs Act and firearms charges. Count 1 of the indictment charged Reyes Lujan and five other Albuquerque residents, Raymond Castillo, 26, Daniel Maestas, 35, Johnny Ramirez, 30, Frank Gallegos, 30, and Henry Lujan, 22, with conspiracy to violate the Hobbs Act. Count 2 charged the six men with violating the Hobbs Act by robbing a Wal-Mart Store in Bernalillo County, N.M., that was engaged in interstate commerce on Oct. 29, 2014. Count 3 charged Castillo with brandishing a firearm during the robbery of the Wal-Mart store, and Count 4 charges Maestas with using and carrying a firearm during the robbery. Count 5 charged Ramirez, Gallegos, Reyes Lujan and Henry Lujan with aiding and abetting the use of firearms during the robbery.
The indictment was superseded in May 2015, by adding a new defendant, Reynaldo Marquez, 25, of Albuquerque, and two new counts. The new Count 6 charged Castillo and Marquez with interfering with interstate commerce by robbing a 7-11 convenience store located in Bernalillo County on Dec. 7, 2014. The new Count 7 charged Marquez with discharging a firearm during that robbery.
On Oct. 19, 2015, Reyes Lujan entered a guilty plea to Count 2 of the superseding indictment charging a violation of the Hobbs Act. According to the plea agreement, Reyes Lujan and his co-defendants jointly planned the Oct. 29, 2014, robbery of the Walmart Store located at 400 Eubank NE in Albuquerque. Reyes Lujan, who was not armed, was dropped off outside of the store to act as a “lookout” while two of his co-defendants went inside the Walmart Store and stole a rolling safe.
Reyes Lujan’s six co-defendants have entered pleas of not guilty to the superseding indictment. Charges in indictments are merely accusations, and all criminal defendants are presumed innocent unless proven guilty beyond a reasonable doubt.
The United States has agreed to separate trials for Counts 1 through 5 of the superseding indictment, which arise out of the alleged robbery of the Walmart Store, and Counts 6 and 7, which arise out of the alleged robbery of the 7-11 convenience store.
If convicted on Counts 1 and 2, the conspiracy charge and the first Hobbs Act charge, the defendants each face a statutory maximum penalty of 20 years in prison. On conviction, Counts 4 and 5, using and carrying a firearm during a crime of violence or aiding and abetting the use of a firearm, each carries a mandatory five-year prison sentence which must be served consecutive to any sentence imposed on the conspiracy and Hobbs Act charges. If Castillo is found to be a career offender and is convicted after trial on Count 3 of the superseding indictment, he faces an enhanced sentence of prison term of 360 months to life imprisonment.
Castillo and Marquez each face a statutory maximum penalty of 20 years if convicted on Count 6 of the superseding indictment. If convicted of discharging a firearm as charged in Count 7, Marquez faces a mandatory minimum of ten years in prison which must be served consecutive to any sentence imposed on him for a conviction on Count 6.
This case was investigated by the Albuquerque office of the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Albuquerque Police Department. Assistant U.S. Attorneys Norman Cairns and Samuel A. Hurtado are prosecuting this case.
This case is being prosecuted as part of a federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders for federal prosecution with the goal of removing repeat offenders from communities in New Mexico for as long as possible. In recognition that New Mexico’s violent crime rates, on a per capita basis, are amongst the highest in the nation, New Mexico’s law enforcement community has come together to is collaborating the initiative is significantly exceed the national average.
40 Individuals Charged with Drug Trafficking ConspiracyRead the Press Release
SAN JUAN, Puerto Rico – Today federal authorities arrested 34 members of a drug trafficking organization which operated in the Santiago Iglesias Public Housing Project, in the municipality of Ponce, announced Rosa Emilia Rodríguez-Vélez, United States Attorney for the District of Puerto Rico. The Federal Bureau of Investigation (FBI) and the Police of Puerto Rico Ponce Strike Force are in charge of the investigation.
On March 3, 2016, a federal grand jury in the District of Puerto Rico returned a six-count indictment against 40 defendants charged with conspiracy to possess with intent to distribute controlled substances, aiding and abetting in the possession /distribution of heroin, cocaine base, cocaine and marijuana, and conspiracy to possess firearm in furtherance of a drug trafficking crime.
The indictment charges 40 individuals for their participation in a conspiracy to knowingly and intentionally possess with intent to distribute cocaine base (crack), heroin, cocaine and marihuana all within 1,000 feet of the real property comprising the Santiago Iglesias Public Housing Project, a housing facility owned by a public housing authority, and other areas nearby and within the Municipality of Ponce, Puerto Rico.
During the span of the conspiracy, in order to be able to operate a drug point at Santiago Iglesias Public Housing Project, “rent” would be paid to the leaders of the drug trafficking organization and their family members. As part of the manner and means of the conspiracy, control of the drug points at Santiago Iglesias was obtained and maintained by the use of force, violence, and intimidation. The drug points operated twenty-four (24) hours a day, in 2 shifts per day.
The indictment also alleges that the co-conspirators had many roles in order to further the goals of the conspiracy. Narcotics belonging to members of the Santiago Iglesias drug trafficking organization were being sold in other areas of Ponce, including but not limited to the Aristides Chavier Public Housing Project, the Gandara Public Housing Project, and the Portugues Public Housing Project. As part of the conspiracy, armed individuals would get paid by the drug trafficking organization to provide security at the Santiago Iglesias Public Housing Project. Members of the drug trafficking organization would forcibly evict individuals from their apartments if they were perceived to be cooperators or if they were unwilling to abide by the rules set by the organization.
The defendants are: Goodwin Vargas-Gonzalez, Robert J. Guzman-Cruz, Miguel A. Rosario-Lugo, Gabriel Confesor Martinez-Cruz, Steven J. Ayala-Martinez, Geraldo Rivera-Lugo, Steven Echevarria-Medina, Jonathan Rodriguez, Christopher Jusino Rodriguez, Juan Gabriel Vega-Madera, Santiago Delgado-Marquez, Pedro L. Lugo-Santiago, Jan C. Camacho-Perez, Hector Montes-Rodriguez, Leonel Sujeil Quiñones-Cruz, Gerardo Rivera-Feliciano, Jose E. Moreau-Rosado, Alexander Ramirez-León, Josue Jorge Rodriguez, Luis A. Rivera-Quiñones, Anthony Zorilla-Figueroa, Angel G. Delgado-Velazquez, Alcides Yamsell-Garcia, Kenneth Mayol-Torres, Francisco Ortiz-Torres, Hector Cintrón- Rodriguez, Eddie J. Vidal-Moran, Luis A. Rivera-Class, Athos Vega-Vidal, Dimari Cardona-Antonetti, Ismael Aponte-Santos, Reynaldo Colon-Natal, Richard Ortiz-Nieves, Luz Maria Santiago, Natasha Colon-Natal, Jose A. Nieves-Echevarria, Yoshua D. Roman-Quiñones, Arquelio Gonzalez-Negron, Jose I. Aponte-Santos, Carlos J. Santiago-Rivera. The defendants are facing a forfeiture allegation of ten million dollars.
“Today’s arrests demonstrate our commitment to dismantle drug trafficking organizations whose members are affecting the quality of life of the law abiding citizens in our public housing projects,” said Rosa Emilia Rodríguez-Vélez, U.S. Attorney for the District of Puerto Rico. “Federal and state law enforcement agencies will continue their hard work to maintain the peace in our neighborhoods.”
“This case involved the long-term victimization of entire communities, who were forced to live in fear due to the nearly incomprehensible level of violence and narcotics trafficking taking place around them. Sadly, housing projects that were designed to provide affordable living have instead become a breeding ground for violent gangs and criminal enterprises. The hearts of everyone in the FBI go out to those families who were denied their basic rights to a safe environment in which to raise children, enjoy retirement, or even to walk safely through the streets of their neighborhoods. As demonstrated today, the law enforcement community will continue to make a priority of targeting for federal investigation those individuals who join together to pray on the innocent,” said Douglas A. Leff, Special Agent in Charge, Federal Bureau of Investigation.
Assistant U.S. Attorney Teresa Zapata-Valladares is in charge of the prosecution of the case. If convicted, the defendants face a minimum sentence of 10 years, and up to life in prison. Indictments contain only charges and are not evidence of guilt. Defendants are presumed to be innocent until and unless proven guilty.
Monday 7 March 2016
Yakima Man Sentenced to 5 Years in Federal Prison for Distribution of Child PornographyRead the Press Release
Spokane – Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that Charles Jacob Jarvis, aka Jake Jarvis, age 29, of Yakima , Washington, was sentenced on March 3, 2016 for Distribution of Child Pornography. Senior United States District Judge Lonny R. Suko sentenced Jarvis to a five-year term of imprisonment, to be followed by a 20-year term of court supervision after he is released from Federal prison. Jarvis will also be required to register as a sex offender.
According to information disclosed during the court proceedings, Jarvis used an Internet file sharing account and e-mail accounts to share and distribute child pornography over the Internet. In March of 2015, U.S. Postal Inspectors determined that Jarvis was obtaining child pornography by U.S. mail. On March 4, 2015, Jarvis was contacted at his place of employment at a day care center in Yakima, Washington. Federal search warrants were obtained to search Jarvis’ personal computers, electronic devices, and e-mails. Forensic examinations revealed that he had used his personal devices and e-mail accounts to store and distribute child pornography that he had obtained over the Internet.
Michael C. Ormsby said, “The United States Attorney’s Office for the Eastern District of Washington takes seriously crimes involving exploitation of children, including child pornography crimes. This office, together with its federal and state law enforcement partners, is and will continue to be committed to prosecuting aggressively and seeking appropriate punishment for child pornography crimes.”
This case was prosecuted as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the United States 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. The Project Safe Childhood Initiative (“PSC”) has five major components:
· Integrated federal, state, and local efforts to investigate and prosecute child exploitation
cases, and to identify and rescue children;
· Participation of PSC partners in coordinated national initiatives;
· Increased federal enforcement in child pornography and enticement cases;
· Training of federal, state, and local law enforcement agents; and
· Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
This investigation was conducted by the U.S. Postal Inspection Service and the Washington State Internet Crimes Against Children Task Force. The case was prosecuted by Ian L. Garriques, an Assistant United States Attorney for the Eastern District of Washington.
Virginia Man Pleads Guilty to Federal Charges for Role in Massive Identity Theft and Tax Fraud SchemeRead the Press Release
Worked With Others to Seek Over $1.5 Million in Fraudulent Refunds
A federal district court judge accepted a Virginia man’s plea of guilty today for his involvement in a far-reaching stolen identity refund fraud scheme in which he conspired with others to seek over $1.5 million in income tax refunds through the filing of fraudulent federal income tax returns, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division, U.S. Attorney Channing D. Phillips of the District of Columbia, Special Agent in Charge Thomas Jankowski of the Internal Revenue Service-Criminal Investigation (IRS-CI), Inspector in Charge Maria L. Kelokates of the U.S. Postal Inspection Service’s Washington Division and Assistant Inspector General for Investigations John L. Phillips of the U.S. Department of the Treasury.
Bradley King, 35, of Fredericksburg, Virginia, is among approximately 19 participants in this scheme who have pleaded guilty to charges in the U.S. District Court for the District of Columbia. According to court documents, the overall case involves the filing of at least 12,000 fraudulent federal income tax returns that sought refunds of at least $42 million. King pleaded guilty to one count of conspiracy to defraud the United States with respect to claims, one count of theft of public money and one count of aiding and abetting in fraud and related activity in connection with identification documents.
The charges carry a total statutory maximum prison term of 35 years. As part of the plea agreement, King agreed to pay $493,436 in restitution to the IRS. King also is subject to a forfeiture money judgment in the amount of $5,400. Sentencing is set for May 18 before U.S. District Judge Ellen S. Huvelle.
According to the government’s evidence, King participated in a massive and sophisticated stolen identity refund fraud scheme that involved an extensive network of more than 130 people, many of whom were receiving public assistance. The refunds were sought for tax years 2005 through 2013, often in the names of individuals whose identities had been stolen, including the elderly, residents of assisted living facilities, drug addicts and incarcerated prisoners. Returns were also filed in the names of and refunds were issued to, people who were willing participants in the scheme. The refunds listed more than 400 “taxpayer” addresses located in the District of Columbia, Maryland and Virginia.
According to documents filed with the court, King’s involvement in the scheme began in 2008 and continued through July 2015. Initially, he permitted co-conspirators to use his name, social security number and residential address for the creation and submission of fraudulent income tax returns. From March 2010 through July 2015, he recruited others to provide him with means of identification for use in preparing and filing fraudulent returns. He also recruited others to permit the use of their residential addresses on fraudulent returns that he prepared and filed. King split the proceeds of the fraudulently obtained U.S. Treasury checks with his co-conspirators. In addition, he and others used bank accounts for the negotiation of refund checks that were issued in the names of other persons. Finally, according to the court documents, King sold fraudulently obtained refund checks to another individual in June 2015.
Taking together the losses generated by the use of residential addresses and bank accounts under his control, including checks associated with his co-conspirators, King was responsible for the filing of approximately 444 fraudulent returns that sought more than $1.5 million in tax refunds. King’s actions led to a total actual loss of approximately $493,436 to the U.S. Treasury, based on the negotiation of 153 U.S. Treasury checks listing addresses under his control and/or negotiated by his recruits.
In announcing the plea, Acting Assistant Attorney General Ciraolo, U.S. Attorney Phillips, Special Agent in Charge Jankowski, Inspector in Charge Kelokates and Assistant Inspector General Phillips commended those who investigated the case. They also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office of the District of Columbia, including former Assistant U.S. Attorney Sherri L. Schornstein and Paralegal Specialists Donna Galindo and Julie Dailey. Finally, they expressed appreciation for the work of Assistant U.S. Attorney Ellen Chubin Epstein of the District of Columbia’s Fraud and Public Corruption Section and Trial Attorneys Jeffrey B. Bender and Thomas F. Koelbl and former Trial Attorney Jessica Moran of the Tax Division, who prosecuted the case.
Virginia Man Pleads Guilty to Federal Charges for Role in Massive Identity Theft and Tax Fraud SchemeRead the Press Release
WASHINGTON – A federal district court judge accepted a Virginia man’s guilty plea today for his involvement in a far-reaching stolen identity refund fraud scheme in which he worked with others to seek over $1.5 million in income tax refunds through the filing of fraudulent federal income tax returns, announced U.S. Attorney Channing D. Phillips of the District of Columbia, Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division, Special Agent in Charge Thomas Jankowski of the Internal Revenue Service-Criminal Investigation (IRS-CI), Inspector in Charge Maria L. Kelokates of the U.S. Postal Inspection Service, Washington Division and Assistant Inspector General for Investigations John L. Phillips of the U.S. Department of the Treasury.
Bradley King, 35, of Fredericksburg, Va., is among approximately 19 participants in this scheme who have pleaded guilty to charges in the U.S. District Court for the District of Columbia. According to court documents, the overall case involves the filing of at least 12,000 fraudulent federal income tax returns that sought refunds of at least $42 million. King pleaded guilty to one count of conspiracy to defraud the United States with respect to claims, one count of theft of public money, and one count of aiding and abetting in fraud and related activity in connection with identification documents.
The charges carry statutory maximum prison terms of 10 years, 10 years, and 15 years, respectively, as well as potential financial penalties. As part of the plea agreement, King agreed to pay $493,436 in restitution to the IRS. King also is subject to a forfeiture money judgment in the amount of $5,400. King is to be sentenced on May 18, 2016, by U.S. District Judge Ellen S. Huvelle.
According to the government’s evidence, King participated in a massive and sophisticated stolen identity refund fraud scheme that involved an extensive network of more than 130 people, many of whom were receiving public assistance. The refunds were sought for tax years 2005 through 2013, often in the names of people whose identities had been stolen, including the elderly, residents of assisted living facilities, drug addicts and incarcerated prisoners. Returns were also filed in the names of, and refunds were issued to, people who were willing participants in the scheme. The refunds listed more than 400 “taxpayer” addresses located in the District of Columbia, Maryland and Virginia.
According to documents filed with the court, King’s involvement in the scheme began in 2008 and continued through July 2015. Initially, he permitted co-conspirators to use his name, Social Security number, and residential address for the creation and submission of fraudulent income tax returns. From March 2010 through July 2015, he recruited others to provide him with means of identification for use in preparing and filing fraudulent returns. He also recruited others to permit the use of their residential addresses on fraudulent returns that he prepared and filed. King split the proceeds of the fraudulently obtained U.S. Treasury checks with his co-conspirators. In addition, he and others used bank accounts for the negotiation of refund checks that were issued in the names of other persons. Finally, according to the court documents, he sold fraudulently obtained refund checks to another individual in June 2015.
Taking together the losses generated by the use of residential addresses and bank accounts under his control, including checks associated with his co-conspirators, King was responsible for the filing of approximately 444 fraudulent returns that sought more than $1.5 million. These actions led to a total actual loss of approximately $493,436 to the U.S. Treasury, based on the negotiation of a total of 153 U.S. Treasury checks listing addresses under his control and/or negotiated by his recruits.
In announcing the plea, U.S. Attorney Phillips, Acting Assistant Attorney General Ciraolo, Special Agent in Charge Jankowski, Inspector in Charge Kelokates and Assistant Inspector General Phillips commended those who investigated the case. They also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office of the District of Columbia, including former Assistant U.S. Attorney Sherri L. Schornstein and Paralegal Specialists Donna Galindo and Julie Dailey. Finally, they expressed appreciation for the work of Assistant U.S. Attorney Ellen Chubin Epstein of the District of Columbia’s Fraud and Public Corruption Section and Trial Attorneys Jeffrey B. Bender and Thomas F. Koelbl and former Trial Attorney Jessica Moran of the Tax Division, who prosecuted the case.
USAO, Mad Dads, P.S. 69--Houghton AcademyRead the Press Release
BUFFALO, N.Y. –U.S. Attorney William J. Hochul, Jr. will serve as judge for the P.S. 69-Houghton Academy Moot Court. The moot court is part of a pilot program involving the United States Attorney’s Office and MAD DADS.
Once a week, approximately 30 students in grades 6, 7 and 8 have been learning about the basics of the legal system and what potential careers are available in the legal and law enforcement fields from members of the U.S. Attorney’s Office in partnership with MAD DADS.
During the moot court, the students will serve on the prosecution and defense teams and the jury as one student faces a charge of “shoplifting.”
Media is welcome to attend the moot court which gets underway at 10:00 a.m. TOMORROW at P.S. 69-Houghton Academy, 1725 Clinton Street, Buffalo 14206.
Two sent to prison for stealing government assistanceRead the Press Release
A Cleveland woman was sentenced to prison for collecting her deceased mother’s Supplmental Security Income benefits for more than 30 years, said Acting U.S. Attorney Carole S. Rendon.
Barbara J. Clark, 63, was sentenced to six months of incarceration and ordered to pay $188,973 in restitution to the Social Security Administration.
Clark pleaded guilty last year to a one-count information for theft of public money. Clark began stealing her mother’s SSI benefits after she died in June 1983, and she continued to withdraw money from their shared account until she was caught in August 2014. The Social Security Administration discovered Clark’s mother’s death through the Medicare Non-Utilization Project, according to court documents.
In an unrelated case, Kathryn Pulley, 60, of Garfield Heights, was sentenced to eight months in prison for stealing more than $58,000 in SSI benefits.
Pulley pleaded guilty last year to a one-count information for theft of public money. She concealed her marriage and cohabitation with her husband from the Social Security Administration in order to receive benefits to which she was not entitled. From June 2007, and continuing until April 2015, she fraudulently received $58,033, which she was ordered to repay in restitution.
Both cases were prosecuted by Special Assistant U.S. Attorney Lisa J. Sanniti following investigations by the Social Security Administration Office of Inspector General.
Two White Sulphur Springs men appear in Federal court on drug chargesRead the Press Release
BECKLEY, W.Va. – Two White Sulphur Springs men appeared today in federal court in Beckley on drug charges, announced Acting United States Attorney Carol Casto.
Darin Timothy Hoke, 21, was sentenced to three years and five months in federal prison for distribution of oxymorphone. Hoke previously pleaded guilty in November 2015 to the federal drug charge. He admitted that on July 28, 2015, he distributed an oxymorphone pill in White Sulphur Springs to a confidential informant working with law enforcement. Hoke also admitted that as part of his drug dealing he had distributed over 600 oxymorphone pills and 120 packets of heroin.
In a separate prosecution, Wilbur Arnold, Jr., 50, pleaded guilty to possession with intent to distribute cocaine. Arnold admitted that on July 22, 2015, law enforcement authorities seized cocaine from his home that he intended to distribute. He faces up to 20 years in federal prison and a $1 million fine when he is sentenced on June 8, 2016.
The case against Hoke was investigated by the Greenbrier Valley Drug and Violent Crime Task Force. The Greenbrier County Sheriff’s Department and the Greenbrier Valley Drug and Violent Crime Task Force investigated the Arnold case. Assistant United States Attorney John File handled the prosecutions. The defendants appeared before United States District Judge Irene C. Berger.
These cases were prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat illegal drugs in our communities, including the illicit sale and misuse of prescription drugs and heroin. The United States Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
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Tehachapi Doctor Sentenced to 6 Months in Prison for Defrauding Patients and Insurers by Implanting Unapproved IUDsRead the Press Release
FRESNO, Calif. — Dr. Paul S. Singh, 55, of Tehachapi, was sentenced today to six months in prison, to be followed by one year of home detention by United States District Judge Anthony W. Ishii, for a scheme to defraud patients and their insurers by implanting and billing for unapproved intrauterine devices (IUDs), United States Attorney Benjamin B. Wagner announced. A restitution hearing is set for May 9, 2016, at 10:00 a.m.
Singh, a medical doctor licensed to practice in California, had an office in Tehachapi. He provided obstetric and gynecological services to women, including providing forms of birth control. One form of birth control he provided were IUDs, which the Food and Drug Administration (FDA) regulates. The FDA has approved only one IUD that uses copper as its active ingredient, the ParaGard T-380A, which was sold only by its manufacturer and not available on third-party websites. Doctors who implant a non-FDA-approved copper IUD risk a patient’s safety. Such a device can result in an increased risk of pelvic inflammatory disease, ectopic pregnancy, hysterectomy, and other serious complications.
According to court documents, Singh bought unapproved IUDs on the Internet and implanted them in his patients. Rather than inform his patients or their insurers of using non-FDA approved IUDs, however, he fraudulently billed his patients and their insurers as if he had implanted FDA-approved IUDs, all without the permission or consent of his patients. Singh profited from the implanting unapproved IUDs by billing his patients and their insurers for the higher cost of approved IUDs, which was false and fraudulent.
According to court documents, Singh was sent multiple bulletins and newsletters warning against the use of unapproved IUDs. He was also warned that products sold by online pharmacies were not identical to the ParaGard T-380A and had not been approved as safe and effective by the FDA. In spite of the warnings, Singh purchased unapproved IUDs from online retailers and implanted them in numerous patients without their consent, between April 2008 and June 2012.
In August 2010, agents from the FDA confronted Singh about his history of implanting unapproved IUDs. During the meeting, Singh agreed to stop implanting them in his patients. In 2012, agents searched Singh’s office and learned that he had continued to implant unapproved IUDs in his patients.
According to the plea agreement, many of Singh’s patients later complained to him and other doctors about medical complications they associated with Singh’s insertion of the IUD. In multiple instances, Singh responded to such complaints by re-inserting the IUD rather than removing it. Some patients ultimately had to switch doctors in order to have the IUD removed.
U.S. Attorney Wagner stated: “Singh’s scheme risked the health of his patients and defrauded health care providers to benefit his bottom line. The investigation and prosecution of health care fraud is a priority for my office, particularly where that fraud endangers innocent patients.”
“Medical doctors have a special responsibility to make the best choices for their patients. When they ignore that responsibility and use unapproved medical devices, they put patients’ safety and health at risk,” said Special Agent in Charge Lisa L. Malinowski, FDA Office of Criminal Investigations’ Los Angeles Field Office. “Our office will continue its work to ensure that doctors and other healthcare professionals understand the consequences of using medical products that have not been approved by the FDA.”
This case was the product of an investigation by the Food and Drug Administration, Office of Criminal Investigations. Assistant United States Attorneys Patrick R. Delahunty and Kirk E. Sherriff prosecuted the case.
Supreme Court Rejects Apple's Request to Review E-Books Antitrust Conspiracy FindingsRead the Press Release
The U.S. Supreme Court today denied Apple’s petition for certiorari in United States v. Apple Inc., making final lower court decisions that Apple orchestrated a price-fixing conspiracy with five major e-book publishers and substantially raised e-book prices.
The Supreme Court’s action triggers Apple’s obligation to pay $400 million to e-book purchasers under Apple’s July 2014 agreement to settle damages actions brought by the attorneys general of 33 states and territories and a private class of e-book purchasers. Most e-book purchasers will receive reimbursement for the higher prices Apple’s conduct caused them to pay through automatic credits at their e-book retailers. They will be able to apply these credits to future purchases. With the $166 million previously paid by the conspiring publishers to settle claims against them, Apple’s payment will bring to $566 million the amount repaid to e-book purchasers overcharged as a result of Apple’s and the publishers’ illegal conspiracy.
“Apple’s liability for knowingly conspiring with book publishers to raise the prices of e-books is settled once and for all,” said Assistant Attorney General Bill Baer of the Justice Department’s Antitrust Division. “And consumers will be made whole. The outstanding work of the Department of Justice team – working with our steadfast state attorney general partners – exposed this cynical misconduct by Apple and its book publisher co-conspirators and ensured that justice was done.”
On April 11, 2012, the department filed its civil antitrust lawsuit challenging Apple’s orchestration of a price-fixing conspiracy with five e-book publishers: Hachette Book Group (USA), HarperCollins Publishers L.L.C., Holtzbrinck Publishers LLC (which does business as Macmillan), Penguin Group (USA) Inc. and Simon & Schuster Inc. The lawsuit, brought in the U.S. District Court for the Southern District of New York, alleged that Apple and the defendant publishers conspired to fix prices and end e-book retailers’ freedom to compete on price, and that they succeeded in substantially increasing the prices that consumers paid for e-books. The department reached settlements with the defendant publishers before trial and, along with the plaintiff states, proceeded to trial against Apple before U.S. District Judge Denise L. Cote of the Southern District of New York on June 3, 2013. Judge Cote issued her opinion and order on July 10, 2013, finding Apple liable for orchestrating a conspiracy with the publishers. On June 30, 2015, the U.S. Court of Appeals for the Second Circuit affirmed Judge Cote’s decision.
St. Louis Woman Sentenced for Structuring Financial TransactionsRead the Press Release
A St. Louis woman, who pled guilty to Structuring Financial Transactions, was sentenced to probation for a period of two years and fined $20,000 on March 4, 2016, the Acting United States Attorney for the Southern District of Illinois, James L. Porter, announced today.
Kyong Suk Kipilla, 58, of St. Louis, Missouri, received a sentence of two years’ probation and a $20,000 fine for Structuring Financial Transactions. The judge ordered Kipilla to serve the first six months of probation confined to her home, monitored by an ankle bracelet. The charges arose from Kipilla’s deposits of proceeds from her prostitution business, the Pink Spa, located in Centreville, Illinois. Federal law requires financial institutions to report currency transactions (such as currency deposits) greater than $10,000 to the IRS. Federal law also prohibits a person from structuring currency transactions for the purpose of evading this reporting requirement. Kipilla engaged in structuring bank deposits in amounts less than $10,000 so as to avoid the reporting requirements. Kipilla was also ordered to pay a $200 special assessment. Kipilla pleaded guilty to the charges on September 3, 2015.
Kipilla is a citizen of South Korea who is present in the United States as a lawful permanent resident.
The case was investigated by members of the Department of Homeland Security, the Internal Revenue Service, and the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorney Stephen B. Clark.
Santa Fe Man Pleads Guilty to Armed Bank Robbery ChargeRead the Press Release
ALBUQUERQUE – Jacob P. Wheeler, 25, of Santa Fe, N.M., pleaded guilty today in federal court in Albuquerque, N.M., to an armed bank robbery charge under a plea agreement with the U.S. Attorney’s Office.
Wheeler was arrested on May 26, 2015, on a criminal complaint charging him with robbing the Century Bank located at 498 N. Guadalupe St. in Santa Fe, on May 15, 2015. The complaint alleged that Wheeler robbed the bank by pointing a gun at the bank teller, demanding money, and climbing up onto the teller’s counter to grab money from a cash drawer.
Wheeler became the target of investigation later that day after the FBI received a tip identifying Wheeler as the bank robber.Wheeler was subsequently indicted on June 24, 2015, and charged with armed bank robbery of the Century Bank located at 498 N. Guadalupe St. in Santa Fe County, N.M., on May 15, 2015.
During today’s plea hearing, Wheeler pled guilty to the indictment and admitted that on May 15, 2015, he robbed the Century Bank in Santa Fe through force, violence and intimidation. At sentencing, Wheeler faces a maximum penalty of 25 years in federal prison followed by up to five years of supervised release. Wheeler 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 Santa Fe Police Department and is being prosecuted by Assistant U.S. Attorney Norman Cairns.
Rochester Woman Sentenced in Sex Trafficking CaseRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051ROCHESTER, N.Y. — U.S. Attorney William J. Hochul, Jr. announced today that Jennifer Miller, 28, of Rochester, NY, who was convicted of conspiracy to commit sex trafficking of a minor was sentenced to 70 months in prison by U.S. District Judge Elizabeth A. Wolford.
Assistant U.S. Attorney Tiffany H. Lee, who handled the case, stated that in April 2013, Miller and another co-conspirator transported a minor to New Jersey and Pennsylvania in order for the minor to engage in commercial sex acts. The defendant used Backpage.com to post ads for the minor. Miller also transported the minor to Pennsylvania another time knowing that the minor would be engaging in commercial sex acts.
Miller was arrested in April 2014 along with Jodia Campbell and Laree Greggs. Charges are pending against defendants Campbell and Greggs. The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
Jodia Campbell and Laree Greggs have been convicted and are awaiting sentencing.
The sentencing is the culmination of an investigation on the part of the Federal Bureau of Investigation's Child Exploitation Task Force, which includes the Rochester Police Department, under the direction of Chief Michael Ciminelli, the Monroe County Sheriff’s Office, under the direction of Chief Patrick O’Flynn, and Special Agents of the Federal Bureau of Investigation, under the direction of Special Agent in Charge Adam S. Cohen.
Roanoke Woman Pleads Guilty to Heroin ChargeRead the Press Release
ROANOKE, VIRGINIA – United States Attorney John P. Fishwick Jr. announced today the guilty plea of a Roanoke woman on charges that she conspired with others to distribute heroin.
Camilla Bridget Ward, 25, of Roanoke, Va., pled guilty last week in the United States District Court for the Western District of Virginia in Roanoke to one count of conspiracy to distribute heroin.
“The use of heroin has destroyed communities throughout the Western District of Virginia,” United States Attorney John P. Fishwick said today. “The number of overdose deaths has risen in the past few years to epidemic levels. We will work with our law enforcement partners to continue to be vigilant in doing what we can to take those who distribute this substance off the streets and provide support to those seeking help for their addiction.”
The investigation of the case was conducted by the Drug Enforcement Administration, the Roanoke City Police Department and officials with the Baltimore/Washington HIDTA. Assistant United States Attorney Andrew Bassford prosecuted the case for the United States.
Roanoke Man Pleads Guilty to Federal Gun ChargeRead the Press Release
ROANOKE, VIRGINIA – United States Attorney John P. Fishwick Jr. announced today the guilty plea of a Roanoke man to a federal gun charge.
Clifton Deron Campbell, 38, of Roanoke, Va., pled guilty today in the United States District Court for the Western District of Virginia in Roanoke to one count of being a previously convicted felon illegally in possession of a firearm. At the time of sentencing, if it is determined that Campbell is to be considered an armed career criminal, he will face a mandatory minimum sentence of 180 months in federal prison.
“We will continue to work with our local, state and federal law enforcement partners to get illegal guns off the streets of our communities,” United States Attorney John P. Fishwick Jr. said today. “We know a key in keeping our communities safe is keeping illegal guns out of the hands of those who mean harm.”
The investigation of the case was conducted by the Federal Bureau of Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Roanoke City Police Department. Assistant United States Attorney Donald R. Wolthuis prosecuted the case for the United States.
Roanoke Man Pleads Guilty to Federal Firearm ChargeRead the Press Release
ROANOKE, VIRGINIA – United States Attorney John P. Fishwick Jr. announced today the guilty plea of a Roanoke man to a federal firearms charge.
Pierce Yarnell Brown, 38, of Roanoke, Va., pled guilty last week in the United States District Court for the Western District of Virginia in Roanoke to one count of being a previously convicted felon illegally in possession of a firearm.
“The key to keeping the public safe it to take guns out of the hands of prohibited users like Mr. Brown,” United States Attorney John P. Fishwick Jr. said today. “We will continue to work to get illegal guns out of the communities of the Western District of Virginia.”
The investigation of the case was conducted by the Roanoke City Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant United States Attorney Andrew Bassford prosecuted the case for the United States.
Registered Sex Offender from Bay Area Found Guilty of Traveling to Cambodia to have Illicit Sexual Conduct with Young GirlsRead the Press Release
LOS ANGELES – A Bay Area man was found guilty this afternoon of travelling to Cambodia to have illicit sexual conduct with young girls.
Ronald Gerard Boyajian, 55, who resided in Menlo Park and previously spent time on the Palos Verdes peninsula, was found guilty of three child exploitation crimes.
Concluding a six-week trial, a federal court jury found Boyajian guilty of travel with intent to engage in illicit sexual conduct, engaging in illicit sexual conduct with a minor in foreign places, and committing these offenses while being required to register as a sex offender.
United States District Judge Christina A. Snyder is scheduled to sentence Boyajian on June 13, at which time he will face a statutory maximum sentence of 30 years in federal prison for each of the two travel offenses and a mandatory consecutive 10-year term for committing these offenses while being required by California law to register as a sex offender. Because two of his convictions carry potential sentence-doubling provisions, Boyajian’s total sentencing exposure is 130 years in federal custody.
Boyajian was arrested by the Cambodian National Police (CNP) in February 2009, while he was on his 35th trip to Asia over a nine-year period. Boyajian began traveling to Cambodia shortly after completing his parole following convictions for illegal sex with a minor and oral sex with a minor in 1994.
“The evidence presented at trial showed that Boyajian thought that he could molest and intimidate his young victims with impunity because he was in a foreign country, but he could not have been more mistaken,” said United States Attorney Eileen M. Decker. “Protecting children from sexual exploitation is one of our top priorities, and we will pursue pedophiles across the globe if necessary. I also salute the courage of his victims who were willing to come to the United States to be witnesses at the trial and testify against him.”
Federal prosecutors presented evidence that Boyajian sexually assaulted four victims, girls who were between 8 and 11 years old when Boyajian attacked them. One victim, who was approximately 8 when she was molested, testified at trial that “he was abusive, he was cruel, he treated me like I wasn’t even human.”
Boyajian paid pimps and sometimes relatives from impoverished families to have access to his victims, which he preferred to weigh less than 70 pounds. While the attacks took place in the village of Svay Pak – which is known as Kilo 11 because it is located 11 kilometers outside of Phnom Penh – the victims were Vietnamese immigrants who lived in the poor community. A CNP anti-human trafficking officer testified at trial that Svay Pak was well known as a place where foreigners went to have sexual contact with females, often young girls. Boyajian went to Svay Pak to have “unlimited access to young girls for sex,” prosecutors said in court.
“For the young victims robbed of their childhood and innocence by this defendant, justice has been a long time coming, but they can take consolation knowing he will now be made to pay for his crimes,” said Joseph Macias, special agent in charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Los Angeles. “I applaud the efforts by the HSI special agents here and overseas, who, along with the federal prosecutors, have fought tirelessly to vindicate the rights of these child victims. Today’s verdict should send a clear and resounding message that traveling overseas to exploit children will not go unnoticed or unpunished.”
Boyajian’s conviction follows convictions and lengthy sentences imposed on other sex tourists who were prosecuted in Los Angeles, including Michael Joseph Pepe, who was sentenced to 210 years in federal prison after being convicted of abusing seven victims in Cambodia (see: http://go.usa.gov/cfqmh), and Stanley Dan Reczko, who received a mandatory life-without-parole sentence for producing child pornography with a minor victim in the Philippines (see: http://go.usa.gov/cfqyG).
The case against Boyajian is the result of an investigation by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations in Los Angeles and HSI’s Attaché Offices in Bangkok, Phnom Penh and Ho Chi Minh, with the assistance of the United States Embassy in Phnom Penh.
Rapid City Man Indicted for Two Counts of Assaulting a Federal OfficerRead the Press Release
United States Attorney Randolph J. Seiler announced that a Rapid City, South Dakota, man has been indicted by a federal grand jury for two counts of Assaulting, Resisting, Opposing and Impeding a Federal Officer.
Alvin Chambers, age 36, was indicted on February 23, 2016. He appeared before U.S. Magistrate Judge Mark A. Moreno on February 29, 2016, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 20 years in custody and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund for each count. Restitution may also be ordered.
It is alleged that on February 19, 2016, in Pierre, South Dakota, Alvin Chambers used a vehicle to forcibly assault a Deputy U.S. Marshal and a Pierre Police Officer.
The charge is merely an accusation and Chambers is presumed innocent until and unless proven guilty.
The investigation is being conducted by numerous agencies including the Federal Bureau of Investigation, the U.S. Marshals Service, the S.D. Division of Criminal Investigation and the Pierre Police Department. Assistant U.S. Attorney Sarah Collins is prosecuting the case.
Chambers was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
Rapid City Couple Plead Not Guilty to Drug ConspiracyRead the Press Release
United States Attorney Randolph J. Seiler announced that a Rapid City, South Dakota, man has been indicted by a federal grand jury for Conspiracy to Distribute a Controlled Substance, Discharging a Firearm during a Drug Trafficking Offense, and Possession of Firearm by a Prohibited Person. A Rapid City woman was also indicted for Conspiracy to Distribute a Controlled Substance.
Nomar Ucha, age 26, and Jenna Holzer, age 31, were indicted on February 23, 2016. Ucha and Holzer appeared before U.S. Magistrate Judge Daneta Wollmann on February 26, 2016, and pleaded not guilty to the Indictment.
The penalty upon conviction for Ucha is at least 10 years and up to life in custody and/or a $250,000 fine, and 5 years of supervised release. The penalty upon conviction for Holzer is at least 5 years, but no more than 40 years, in custody and/or a $250,000 fine. Restitution may also be ordered for both of them.
The charges relate to Ucha and Holzer conspiring to distribute 50 grams or more of methamphetamine between November 1, 2015, and February 23, 2016, in South Dakota. Ucha also discharged a .45 caliber pistol in Rapid City on December 4, 2015, and then was found with pistols, a revolver, and a rifle in his possession on December 15, 2015.
The charges are merely accusations and Ucha and Holzer are presumed innocent until and unless proven guilty.
The investigation is being conducted by the Unified Narcotics Enforcement Team, U.S. Drug Enforcement Administration, South Dakota Division of Criminal Investigation, Rapid City Police Department, and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. Assistant U.S. Attorney Kathryn N. Rich is prosecuting the case.
Ucha and Holzer were remanded to the custody of the U.S. Marshals Service pending trial. A trial date has been set for May 3, 2016.
Passaic County, New Jersey, Man Admits Role in $1.3 Million ‘Shotgun’ Loan SchemeRead the Press Release
NEWARK, N.J. – A self-employed loan broker today admitted using bogus documents and simultaneous applications at multiple banks to fraudulently obtain home equity lines of credit, resulting in losses of $1.3 million, U.S. Attorney Paul J. Fishman announced.
Sung Ho Mo, a/k/a “Douglas Mo,” 53, of Totowa, New Jersey, pleaded guilty before U.S. District Judge Katharine S. Hayden to an information charging him with conspiracy to commit bank fraud. He was previously arrested on Aug. 4, 2015 and released on bail.
According to documents filed in this case and statements made in court:
Mo was the primary owner and operator of “Douglas Mo Mortgage,” a mortgage brokerage business in New Jersey. From 2005 through January 2014, Mo conspired with others, including a tax preparer, to fraudulently obtain home equity lines of credit and first mortgages.
As part of the scheme, Mo fraudulently obtained multiple home equity lines of credit from multiple banks, using his primary and secondary residences in Totowa as collateral for the loans. To trick the banks into issuing the lines of credit, Mo first engaged in a practice that he described as “shotgun loans,” in which he applied for several home equity lines of credit with multiple banks at the same time. By engaging in this practice, Mo thwarted the banks’ efforts to learn of security interests held by other banks on his homes.
Second, Mo falsely inflated his income by paying a tax preparer to produce false documents, including bogus W-2 forms, federal income tax returns and paystubs. Mo then submitted the fraudulent documents to the banks in support of his loan applications. After receiving home equity lines of credit, Mo used the proceeds for his own benefit and then defaulted on the loans. In addition, Mo obtained first mortgages for his clients using the same fraudulent scheme.
At sentencing, Mo faces a maximum potential penalty of 30 years in prison, a $1 million fine, and will be ordered to pay restitution. Sentencing is scheduled for June 13, 2016.
U.S. Attorney Fishman praised agents of the FBI, under the direction of Acting Special Agent in Charge Andrew Campi in Newark, for the investigation leading to today’s plea.
The government is represented by Assistant U.S. Attorney Anthony Moscato of the New Jersey U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel: Assistant Federal Public Defender Kevin F. Carlucci Esq., Newark
Oregon Man Pleads Guilty for Role in Multiple Overdose Deaths and Injuries in ‘Operation Denial’Read the Press Release
FARGO - U. S. Attorney Christopher C. Myers announced that on March 7, 2016, Brandon Corde Hubbard, 41, of Portland, Oregon, pled guilty before U. S. District Judge Ralph R. Erickson to a three count Indictment charging Conspiracy to Distribute Controlled Substances Resulting in Serious Bodily Injury and Death; Distribution of a Controlled Substance Resulting in Death; and Money Laundering Conspiracy.
In or about Jan. 2014, Hubbard was an integral part of a conspiracy trafficking fentanyl, heroin, and other drugs in and through North Dakota, Oregon, and elsewhere. The Grand Forks Narcotics Task Force began investigating this case after the overdose death of 18-year-old Bailey Henke on Jan. 3, 2015. The investigation revealed that Hubbard, using the “Dark Web,” was able to anonymously distribute these drugs within North Dakota, as well as across the United States, from his home located in Oregon.
As part of the plea agreement, Hubbard acknowledged he was responsible for two deaths and four overdoses resulting in serious bodily injury in both North Dakota and Oregon. This investigation is the result of a national and international joint Organized Crime and Drug Enforcement Task Force (OCDETF) investigation dubbed “Operation Denial.” To date there have been nine defendants charged in North Dakota and three defendants charged in Oregon as part of this cooperative investigation.
Judge Erickson has set sentencing for June 26, 2016, at the U. S. District Court in Fargo.
This case is being investigated by the Department of Homeland Security - Homeland Security Investigations, Drug Enforcement Administration, United States Postal Inspection Service, Grand Forks Narcotics Task Force, Royal Canadian Mounted Police, Portland Oregon Police Bureau – Drugs and Vice Division, Portland HIDTA Interdiction Task Force, Oregon State Police, and the Grand Forks Police Department.
U. S. Attorney Christopher C. Myers, Assistant U. S. Attorney Scott Schneider, and Special Assistant U.S. Attorney Scott Kerin are prosecuting the case.
Ontario Drug Dealer and Former Gang Member Sentenced to 60 Months in PrisonRead the Press Release
EUGENE, Ore. – Humberto Rodriguez, 33, of Malheur County, Oregon, was sentenced on Thursday, March 3, 2016, by U.S. District Judge Ann Aiken to 60 months in prison for possession with intent to distribute methamphetamine and felon in possession of a firearm. Following his release from prison, Rodriguez will be on supervised release for four years.
On April 10, 2012, an Oregon State Police Trooper stopped a vehicle in which Humberto Rodriguez was a passenger. Rodriguez was on probation and was asked to step from the vehicle, at which time he attempted to flee. He was immediately apprehended and approximately one ounce of methamphetamine was found on his person. A firearm was also recovered in the vehicle within his arm’s reach.
At the time of his arrest, Rodriguez was a member of a Surenos affiliated gang. He has prior felony convictions which include delivery of a controlled substance, transporting a controlled substance and felon in possession of a firearm.
The investigation of this case was conducted by the Oregon State Police, the Boise, Idaho office of the ATF and the Ontario Police Department. The case was prosecuted by Assistant U.S. Attorneys Jeffrey Sweet and Amy Potter.
North Dakota Man Sentenced for Filing False ClaimRead the Press Release
United States Attorney Randolph J. Seiler announced that a Halliday, North Dakota, man convicted of False Claim was sentenced on March 4, 2016, by Chief Judge Jeffrey L. Viken, U.S. District Court.
Karl Jakob Knutson, age 28, was sentenced to 12 months of imprisonment, followed by 3 years of supervised release, ordered to pay a $100 special assessment to the Federal Crime Victims Fund, and a fine of $7,380.04.
Knutson was charged on May 19, 2015, and pleaded guilty on November 20, 2015.
The conviction stems from Knutson falsely claiming to the Farm Service Agency to have lost 129 head of cattle during the October 2013 winter storm Atlas, knowing he had lost no more than 13.
This case was investigated by the Office of Inspector General, U.S. Department of Agriculture. Assistant U.S. Attorney Ben Patterson prosecuted the case.
Multiple defendants appear on Federal charges in HuntingtonRead the Press Release
HUNTINGTON, W.Va. – Multiple defendants appeared today in federal court in Huntington, announced Acting United States Attorney Carol Casto.
Andre Robert Womble, II, 26, of Huntington, was sentenced to three years and one month in federal prison for a heroin crime. He previously pleaded guilty in November 2015 to possession with intent to distribute heroin. On December 11, 2014, officers with the Huntington Police Department responded to a complaint on the 300 block of Marcum Terrace in Huntington. An officer observed Womble and noted that he matched the description of the suspect in the complaint. When the officer attempted to approach, Womble began running from the police. The officer chased Womble and observed him throw a cigarette box on the roof of the Olive Street Market. The cigarette box was found by law enforcement to contain approximately 53 grams of heroin. Officers caught and arrested Womble, at which point they found an additional 20 bags of heroin in his pocket. Womble admitted that he intended to distribute all of the heroin.
In a separate prosecution of a federal gun crime, Shane Patrick Masters, 45, of Huntington, pleaded guilty to unlawful possession of a firearm by a person previously convicted of a crime of domestic violence. On July 2, 2015, Masters traveled to the 26th Street Drinkery, a bar in Huntington. Masters had a handgun in his vehicle when he arrived at the bar where he met and had drinks with two other individuals. Later on in the early morning hours, those two individuals came into possession of the gun and provided it to officers with the Huntington Police Department. Masters was prohibited from possessing any firearm under federal law because of a 2015 domestic battery conviction in Wayne County Circuit Court. Masters faces up to 10 years in federal prison when he is sentenced on June 6, 2016.
In a separate drug prosecution, Michael Muncy, 36, and his mother, Naomi Messer, 55, both of Crum in Wayne County, pleaded guilty to possession with intent to distribute oxycodone. Following several controlled purchases of oxycodone from their residence in Crum, law enforcement executed a search warrant at the house on February 21, 2012. Law enforcement seized oxycodone pills and cash, including pre-recorded buy money from a prior controlled purchase of oxycodone. Muncy and Messer each face up to 20 years in federal prison and a $1 million fine when they are sentenced on June 13, 2016.
The Huntington FBI Drug Task Force and Huntington Police Department conducted the investigation of Womble. The Huntington Police Department with assistance from the Bureau of Alcohol, Tobacco, Firearms and Explosives conducted the investigation of Masters. Assistant United States Attorney Joseph F. Adams is handling the prosecutions of Womble and Masters. The West Virginia State Police and the Route 119 Task Force conducted the investigation of Muncy and Messer. Assistant United States Attorney Jennifer Rada Herrald is in charge of the prosecutions of Muncy and Messer.
The hearings were held before Chief United States District Judge Robert C. Chambers.
The federal firearms charge was prosecuted as part of Project Safe Neighborhoods. Project Safe Neighborhoods is a nationwide commitment to reduce gun crime in the United States by working with existing local programs that target gun crime. The federal drug prosecutions were brought as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and heroin. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
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Missouri man pleads guilty to selling LSDRead the Press Release
WHEELING, WEST VIRGINIA – Casey Tyler Nagy, 29, originally of Missouri, was convicted of drug trafficking today in federal court, United States Attorney William J. Ihlenfeld, II, announced.
Nagy distributed lysergic acid diethylamide (LSD) in June 2015 in Wetzel County, West Virginia.
Nagy pled guilty today to one count of “Distribution of LSD.” He faces up to 20 years in prison and a fine of up to $1,000,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney David Perri prosecuted the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms and Explosives and the New Martinsville Police Department investigated.
Senior U.S. District Judge Frederick P. Stamp, Jr. presided.
Minnesota Man Sentenced for Possession of an Unregistered FirearmRead the Press Release
United States Attorney Randolph J. Seiler announced that a Bloomington Prairie, Minnesota, man convicted of Possession of an Unregistered Firearm was sentenced on February 26, 2016, by Chief Judge Jeffrey L. Viken, U.S. District Court.
Nathaniel Bachelder, age 35, was sentenced to time served, of approximately 7 months in federal custody, 3 years of supervised release, and ordered to pay a $100 special assessment to the Federal Crime Victims Fund.
Bachelder was indicted for the charge on March 17, 2015, and pled guilty on November 6, 2015.
The conviction stems from Bachelder possessing an unregistered destructive device, more specifically, a zip gun, which is a homemade slam-type weapon consisting of two sections of pipe, while traveling through Mt. Rushmore on December 14, 2014.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the National Park Service Law Enforcement Rangers. Assistant U.S. Attorney Eric Kelderman prosecuted the case.
Middlesex County, New Jersey, Man Admits Using ‘Booster Bag’ to Steal Hundreds of Thousands of Dollars Worth of Barnes & Noble MerchandiseRead the Press Release
TRENTON N.J. – A Middlesex County, New Jersey, man today admitted shoplifting Barnes and Noble merchandise, selling the goods on eBay and failing to report the illicit proceeds to the IRS, U.S. Attorney Paul J. Fishman announced.
Dominick James Izzo, 49, of Piscataway, New Jersey, and Port Orange, Florida, pleaded guilty before U.S. District Judge Freda L. Wolfson to an information charging him with one count of transportation of stolen goods and one count of tax evasion.
According to the documents filed in this case and statements made in court:
Izzo admitted that he stole merchandise from Barnes & Noble stores in New Jersey, Florida and elsewhere using a “booster bag” lined with aluminum to evade anti-theft alarms. He then listed the stolen merchandise on eBay using nominee seller accounts to conceal his identity. Izzo accepted payment for the stolen merchandise from purchasers via nominee PayPal accounts. Once Izzo received funds via domestic wire transfer from the purchasers, he shipped the stolen merchandise from New Jersey and Florida to the purchasers in several different states.
For the tax years 2009, 2010 and 2011, Izzo admitted he intentionally failed to report $399,485 in income he received in connection with the sale of stolen merchandise from Barnes & Noble and other businesses. As a result, Izzo owed the government approximately $67,360.
The transportation of stolen goods count to which Izzo pleaded guilty is punishable by a maximum potential penalty of 10 years in prison and a $250,000 fine. The tax evasion count carries a maximum potential penalty of five years in prison and $250,000 fine. Sentencing is scheduled for June 10, 2016.
U.S. Attorney Fishman credited postal inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge Maria L. Kelokates, and special agents of IRS–Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen, with the investigation leading to today’s plea.
The government is represented by Assistant U.S. Attorney Lakshmi Srinivasan Herman of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
Defense Counsel: Patrick McMahon Esq., Assistant Federal Public Defender, Newark.
Mexican Native Sentenced on Illegal Reentry ChargeRead the Press Release
ROANOKE, VIRGINIA – United States Attorney John P. Fishwick Jr. announced today the sentencing of a man who previously pled guilty in the United States District Court for the Western District of Virginia in Roanoke to illegally reentering the United States after being previously deported.
Leobardo Antonio-Martinez, a.k.a. “Martin Hernandez Cruz,” and “Jose Antonio Francisco,” 33, of Mexico, previously pled guilty to one count of illegally reentering the United States after being previously deported. Last week in District Court, Antonio-Martinez was sentenced to 21 months in prison and three years of supervised release thereafter.
“This individual has been previously removed from the United States on several occasions. We must be vigilant in enforcing the immigration laws of the United States,” United States Attorney John P. Fishwick Jr. said today.
According to evidence presented at previous hearings by Assistant United States Attorney C. Patrick Hogeboom III, Antonio-Martinez was arrested by the Roanoke County Sheriff’s Office on September 20, 2015 for not having a driver’s license and hit and run. After further review, it was established that the defendant was a native and citizen of Mexico by virtue of birth and had been removed from the United States multiple times, including on June 16, 2009 from Laredo, Texas after being convicted of assault in the first degree in Dorchester County, Maryland and sentenced to fifteen years in prison. Antonio-Martinez was again removed on February 24, 2011 from Sasabe, Arizona and again on March 16, 2011 from Calexico, California.
The investigation of the case was conducted by Department of Homeland Security, Immigration and Customs Enforcement, Enforcement Removal Operations. Assistant United States Attorney C. Patrick Hogeboom III prosecuted the case for the United States.
Mars Hill Woman Pleads Guilty to Bath Salts Distribution ConspiracyRead the Press Release
Contact: Andrew McCormack
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Leda Giggey, 45, of Mars Hill, Maine, pleaded guilty today in U.S. District Court to conspiracy to possess with intent to distribute and to distribute bath salts.
According to court records, between about January 2012 and June 2014, Giggey conspired with others in Aroostook County to obtain and distribute bath salts. On multiple occasions, Giggey ordered bath salts over the internet from China for personal use and to sell to other conspirators.
The defendant faces up to 20 year in prison and a $1,000,000 fine. She will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
The case was investigated by the U.S. Drug Enforcement Administration and the Maine Drug Enforcement Agency with assistance from the Aroostook County Sheriff’s Department and the U.S. Postal Inspection Service.
Manderson Man Pleads Not Guilty to Sexual Abuse and AssaultRead the Press Release
United States Attorney Randolph J. Seiler announced that a Manderson, South Dakota, man has been indicted by a federal grand jury for Aggravated Sexual Abuse and Assault of Intimate Partner by Strangulation.
Nolan White Butterfly, a/k/a Nolan Angel, age 23, was indicted on February 23, 2016. White Butterfly appeared before U.S. Magistrate Judge Daneta Wollmann on February 26, 2016, and pleaded not guilty to the Indictment.
The maximum penalty upon conviction is life in custody and/or a $250,000 fine, 5 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The charges relate to White Butterfly sexually assaulting and strangling a female on November 12, 2015, near Manderson.
The charges are merely accusations and White Butterfly is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Bureau of Indian Affairs, Office of Justice Services, and the Oglala Sioux Tribe Department of Public Safety. Assistant U.S. Attorney Kathryn N. Rich is prosecuting the case.
White Butterfly was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has been set for May 3, 2016.
Major Investigation Involving Hells Angels Concludes with Conviction of Hells Angels PresidentRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051ROCHESTER, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that Richard W. Mar, 64, of Monterey, California, pleaded guilty to conspiracy to possess with intent to distribute, and to distribute, 50 grams or more of methamphetamine, before U.S. District Judge Charles J. Siragusa. The charge carries a mandatory minimum penalty of five years in prison, a maximum penalty of 40 years in prison, and a $2,000,000 fine.
Assistant U.S. Attorney Brett A. Harvey, who is handling the case, stated that, from 2002 through July 2010, Mar – the President of the Hell’s Angels, Monterey (California) Charter at the time – supplied significant quantities of methamphetamine to a methamphetamine trafficking network operating in the Western District of New York. The leader of the network was James H. McAuley, Jr. – a member and Vice President of the Rochester Hell’s Angels. During the conspiracy, McAuley and other members of the conspiracy traveled to the Monterey, California, on numerous occasions to obtain pound-size quantities of methamphetamine from Mar, in exchange for cash. The methamphetamine was be transported and/or shipped from California to the Rochester area, where other members of the conspiracy would sell and distribute it to their customers.
In April 2007, McAuley was arrested on federal racketeering charges in the Northern District of New York. After his arrest and incarceration, McAuley continued to maintain control over the methamphetamine trafficking operation. Mar, acting at the direction of McAuley, distributed pound-size quantities of methamphetamine to McAuley’s wife, Donna Boon. Boon and other members of the conspiracy sold and distributed the methamphetamine to individuals in the Rochester area, Genesee County, and other locales. Mar, who admitted to trafficking up to 15 kilograms of methamphetamine during the course of the conspiracy, continued to supply the methamphetamine trafficking network until July 2010.
The plea is part of a larger investigation that resulted in the indictment and arrest of members and associates of the Rochester and Monterey (California) Hell's Angels for drug trafficking and racketeering-related offenses in February 2012. Seven defendants – including Mar – were charged with conspiracy to possess with intent to distribute, and to distribute, 500 grams or more of methamphetamine. All of the defendants – Mar; McAuley, Boon; Gordon L. Montgomery; Jeffrey A. Tyler; Richard E. Riedman; and Paul Griffin, have been convicted. Judge Siragusa sentenced Griffin to probation and Riedman to 37 months in prison; the remaining defendants are awaiting sentencing.
Rochester Hell's Angels member Robert W. Moran, Jr., a/k/a Bugsy, was convicted of conspiracy to commit assault with a dangerous weapon in aid of racketeering activity. Gina Tata was convicted of being an accessory after the fact to the conspiracy to commit assault with a dangerous weapon in aid of racketeering activity. Defendant Timothy M. Stone was convicted of being an accessory after the fact to the assault.
The plea is the culmination of an investigation on the part of the Federal Bureau of Investigation, under the direction of Special Agent in Charge Adam Cohen, the Genesee County Sheriff's Office, under the direction of Sheriff Gary T. Maha, the Drug Enforcement Administration, under the direction of Special Agent in Charge James J. Hunt, New York Field Division, the New York State Police, under the direction of Major Craig Hanesworth, the City of Batavia Police Department, under the direction of Chief Sean Shawn Heubusch, and the Village of LeRoy Police Department.
Mar is scheduled to be sentenced on June 9, 2016, at 11:00 a.m. before Judge Siragusa.
Justice Department Wins Religious Discrimination Lawsuit Against Colorado City, Arizona, and Hildale, UtahRead the Press Release
A federal jury in Phoenix returned a verdict today finding that the towns of Colorado City, Arizona, and Hildale, Utah, and their joint water company systematically discriminated against individuals who are not members of the Fundamentalist Church of Jesus Christ of Latter-day Saints (FLDS) in the provision of housing, utility and policing services in violation of the Fair Housing Act. Prior to the jury verdict, the parties reached an agreement that the defendants will pay $1.6 million to resolve the monetary claim under the Fair Housing Act.
The jury also issued an advisory verdict on the Department of Justice’s claims under Section 14141 of the Violent Crime Control and Law Enforcement Act. Because this statute (in contrast to the Fair Housing Act) does not include a right to a jury trial, the jury’s verdict as to the Section 14141 claim is advisory and may be considered by the court, but is not binding. In its advisory verdict, the jury found that the Colorado City Marshal’s Office, the cities’ joint police department, operated as an arm of the FLDS church in violation of the establishment clause of the First Amendment; engaged in discriminatory policing in violation of the equal protection clause of the 14th Amendment and the establishment clause; and subjected individuals to unlawful stops, seizures and arrests in violation of the Fourth Amendment. Because these advisory findings are not binding, the Department of Justice’s Section 14141 claim remains under consideration by the district court judge, who will issue a ruling on whether the defendants engaged in these constitutional violations, and if so, what relief is appropriate.
“Today’s verdict reaffirms that America guarantees all people equal protection and fair treatment, regardless of their religious beliefs,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division. “When communities deny their residents critical services simply because of where they worship, they violate our laws and threaten the defining values of religious freedom and tolerance that are the foundation of our country.”
This was the department’s first lawsuit to include claims under both the Fair Housing Act and Section 14141, the federal statute that allows the Attorney General to address patterns or practices of police misconduct.
This matter was litigated by attorneys from the Civil Rights Division’s Housing and Civil Enforcement Section and the Special Litigation Section. More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt.
Jury Convicts Clermont County Man of Producing, Receiving, Possessing Child Pornography, Obscene Images of Child Sexual AbuseRead the Press Release
CINCINNATI – A United States District Court jury convicted David Guy, 61, of New Richmond, Ohio of 11 counts of obscene visual representations of the sexual abuse of children, one count of attempted production of child pornography, three counts of receipt of child pornography and one count of possession of child pornography.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, Clermont County Sheriff Tim Rodenberg and other members of the Regional Electronic Computer Investigations Task Force including Hamilton County Sheriff Jim Neil and Cincinnati Police Chief Eliot Isaac, announced the verdict reached Friday, which was returned following a trial that began on February 29 before U.S. District Judge Susan J. Dlott.
Guy used Photoshop to create hundreds of visual depictions using 11 different minor victims by placing the children’s faces into images of very graphic adult and child pornography. In addition, Guy attempted to produce child pornography when he took a photo of one minor, posing the child on her hands and knees and exposing her bottom.
A search of computers seized from Guy’s residence revealed the extent of his child pornography collection. Guy’s images included depictions of the sexual bondage of children less than five years of age, bestiality, lascivious exhibition, among many other graphic and violent images.
According to court testimony, Guy claimed that the over 25,000 images of child pornography he received and possessed were inspiration for his art. He claimed, through counsel, that the hundreds of images of graphic child pornography he Photoshopped were merely art.
Guy also claimed that the government was to blame for attempting to sensor his work, which was rebutted by Assistant U.S. Attorney Timothy D. Oakley during rebuttal.
“May we never live in a society where the vile images you have seen during the course of this trial becomes the ‘community standard,’” Assistant U.S. Attorney Christy L. Muncy told the jury during closing argument.
The jury convicted Guy with the 16 counts he was charged with after less than an hour of deliberation.
Obscene visual representations of the sexual abuse of children is a crime punishable by not less than five years and up to 20 years in prison. Production of child pornography carries a sentence ranging from 15 to 30 years in prison. Receipt of child pornography carries a sentencing range from 5 to 20 years and possession of child pornography is punishable by up to 20 years in prison.
Stewart commended the cooperative investigation by agents and officers of the Clermont County Sheriff’s Office, the Regional Electronic Computer Investigations Task Force, which is comprised of officers from the Hamilton County Sheriff’s Office and the Cincinnati Police Department, as well as Assistant U.S. Attorneys Christy L. Muncy and Timothy D. Oakley, who prosecuted the case.
Judge Sentences Pittsburgh Man to 5 Years in Prison for Drug and Gun Law ViolationsRead the Press Release
PITTSBURGH -A Pittsburgh resident has been sentenced in federal court to five years’ imprisonment on his convictions of possession with intent to distribute 100 grams or more of heroin and being a felon in possession of a firearm, United States Attorney David J. Hickton announced today.
Senior United States District Judge Donetta W. Ambrose imposed the sentence on 20-year-old Raymear Jernigan.
According to information presented to the court, on or about Oct. 17, 2014, after having been convicted of a felony drug offense, Jernigan possessed a Taurus, .38 special revolver. Jernigan also possessed over 200 grams of heroin with the intent to distribute it.
Prior to imposing sentence, Judge Ambrose stated that the term of imprisonment of five years underlines the seriousness of the offenses.
Assistant United States Attorney Tonya Sulia Goodman prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Federal Bureau of Investigation’s Greater Pittsburgh Safe Streets Task Force and the Pittsburgh Bureau of Police for the investigation leading to the successful prosecution of Jernigan.
Hyattsville Man Sentenced to Three Years in Prison for Distributing Marijuana through the U.S. MailRead the Press Release
Greenbelt, Maryland – U.S. District Judge Deborah K. Chasanow sentenced Kirt Omar Gibbs, age 26, of Hyattsville, Maryland today to three years in prison, followed by three years of supervised release, in connection with a conspiracy to distribute marijuana through the U.S. mail by bribing a U.S. Postal Service employee. A federal jury convicted Gibbs on December 7, 2015.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Postal Inspector in Charge Maria L. Kelokates of the U.S. Postal Inspection Service - Washington Division; Special Agent in Charge Paul L. Bowman of the U.S. Postal Service, Office of Inspector General; and Colonel William M. Pallozzi, Superintendent of the Maryland State Police; Chief J. Thomas Manger of the Montgomery County Police Department; Chief Hank Stawinski of the Prince George’s County Police Department; and Chief David B. Mitchell of the University of Maryland Police Department, as part of the Maryland State Police HIDTA Metropolitan Area Drug Task Force.
According to court documents and testimony at his five day trial, from May 2013 through September 27, 2013, Gibbs conspired with Kenneth Teasley and others to distribute marijuana. Gibbs and his co-conspirators bribed Teasley to induce him to: provide addresses along his route that they could use to send packages of marijuana to Maryland; and deliver the contraband packages to them.
According to trial testimony, in the Spring of 2013, one of Teasley’s co-workers introduced him to Gibbs and advised him that Gibbs was looking for USPS letter carriers who would provide addresses to Gibbs and his co-conspirators which they could use to send packages of marijuana into Maryland. Beginning in May 2013, Teasley used text messages to provide addresses that were on his delivery route to Gibbs and/or other members of the conspiracy. When a contraband package arrived at the U.S. Post Office, Teasley picked up the package and notified Gibbs or another conspirator, who would meet Teasley along his mail route to pick up the package. In exchange, Gibbs paid Teasley between $150 and $400 for each delivery. According to trial testimony, Gibbs received a package approximately every week. Evidence showed that in addition to his role intercepting packages and coordinating with the postal carriers, Gibbs was also responsible for purchasing marijuana from suppliers in other states.
Telephone records introduced at trial showed text messages reflecting that Gibbs was distributing marijuana as far back as December 2012 and had made approximately $100,000 from the marijuana business. At today’s sentencing, the Court found that Gibbs was responsible for distributing between 80 and 100 kilograms of marijuana during the time of the conspiracy.
Former U.S. Postal Service letter carrier Kenneth Teasley previously pleaded guilty to his role in the conspiracy and is scheduled to be sentenced on March 21, 2016 at 2:00 p.m.
United States Attorney Rod J. Rosenstein praised the U.S. Postal Inspection Service, U.S. Postal Service Office of Inspector General, and Maryland State Police HIDTA Metropolitan Area Drug Task Force for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Deborah A. Johnston and Michael T. Packard, who prosecuted the case.
Houston Man Sentenced to More Than 10 Years in Prison for Biodiesel Fraud SchemeRead the Press Release
Philip Joseph Rivkin, aka Felipe Poitan Arriaga, was sentenced today in Houston, Texas, to 121 months in prison, three years of supervised release and to pay more than $87 million in restitution and was ordered to forfeit $51 million for generating and selling fraudulent biodiesel credits in the federal renewable fuel program, the Justice Department’s Environment and Natural Resources Division announced.
In June 2015, Rivkin pleaded guilty to one count of mail fraud and one count of making a false statement under the Clean Air Act.
"Rivkin’s abuse of the biodiesel program, a program designed to further our nation’s energy independence and combat climate change, was an abuse against the American people,” said Assistant Attorney General John C. Cruden for the Justice Department’s Environment and Natural Resources Division. “This sentence should send a strong message that those committing fraud in the bio-diesel program will be vigorously prosecuted and sent to prison.”
“Today we take another big step toward upholding the integrity of an important program that reduces greenhouse gas emissions and promotes energy independence,” said Assistant Administrator Cynthia Giles for the Environmental Protection Agency’s (EPA) for Enforcement and Compliance Assurance. “After years of persistence by EPA and our partners, we’ve brought a serious offender to justice for environmental crimes. This sentence deters would-be violators and helps protect responsible companies that follow the rules.”
The Energy Independence and Security Act of 2007 created or extended several federally-funded programs that created monetary incentives for the production of renewable fuels, including biodiesel and to encourage the use of such fuels in the United States. Authorized biodiesel producers and importers could generate and attach credits—known as renewable identification numbers (RINs)—to biodiesel they produced or imported. Because certain companies need RINs to comply with regulatory obligations, RINs have significant market value.
As admitted in the plea agreement, beginning around February of 2009, Rivkin operated and controlled several companies in the fuel and biodiesel industries, including Green Diesel LLC, Fuel Streamers Inc. and Petro Constructors LLC, all based in Houston. Rivkin claimed to produce millions of gallons of biodiesel at the Green Diesel’s Houston facility and then generated and sold RINs based upon this claim. In reality, no biodiesel was ever produced at the Green Diesel facility. This scheme allowed the defendant to generate over 60 million RINs that were fraudulent, which were then sold to companies that needed to obtain them and resulted in millions of dollars in sales. Rivkin created false records and made false statements to conceal his fraudulent claims of biodiesel production, importation and RIN generation.
The collaborative investigation that led to today’s sentence was the result of work by Environmental Protection Agency’s Criminal Investigation Division, the United States Secret Service, Internal Revenue Service-Criminal Investigation, Homeland Security Investigations and the Guatemalan Special Investigations Unit, which worked with federal investigators to uncover the fraudulent nature of Rivkin’s Guatemalan citizenship, which led to his deportation back to the United States.
The case is being prosecuted by Trial Attorney Leslie E. Lehnert of the Environmental Crimes Section of the Justice Department’s Environment and Natural Resources Division.
Fort Hall Man Sentenced for Selling MethRead the Press Release
POCATELLO – Charles Eugene Allhands, 52, of Fort Hall, Idaho, was sentenced today to eight months in prison for possession with intent to distribute a controlled substance, U.S. Attorney Wendy J. Olson announced. Chief U.S. District Judge B. Lynn Winmill also ordered Allhands to serve three years of supervised release. Allhands pleaded guilty on December 9, 2015.
According to the plea agreement, on March 8, 2015, Allhands sold methamphetamine to an individual at Allhands’ residence on the Fort Hall Indian Reservation.
The case was investigated by the Fort Hall Police Department, the Bingham County Sheriff’s Office, and the Federal Bureau of Investigation.
Former Brink’s Employee Charged with Stealing $200,000 in QuartersRead the Press Release
BIRMINGHAM – Federal prosecutors today charged a Harpersville man with stealing nearly $200,000, all in quarters, while he worked for Brink’s Company armored transport service, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Roger C. Stanton.
The U.S. Attorney’s Office charged STEPHEN LANCASTER DENNIS, 49, with one count of bank theft for stealing $196,000 belonging to the Federal Reserve Bank of Atlanta while he worked as a money processing manager for Brink’s at its Birmingham branch in early 2014. Dennis has entered an agreement with the government to plead guilty to the charge and repay $196,000 to Brink’s. The armored service already has reimbursed the Federal Reserve Bank for the loss.
“This defendant may have thought he had quite a haul when he took nearly $200,000 in quarters from the Federal Reserve’s coin storage at Brink’s, but now he carries a heavier load. He must repay the money and face a federal sentence,” Vance said.
“What Mr. Dennis may have thought was a nickel and dime theft was, in the end, the equivalent of a major bank heist,” Stanton said. “Now, he will be a convicted felon who must repay all the stolen money.”
According to the charging document and Dennis’ plea agreement, he carried out the theft as follows:
Brink’s stored U.S. currency and coin belonging to its customers, including the Atlanta Federal Reserve Bank, at Brink’s facility in Birmingham. As a money processing manager at the facility, Dennis had access to the Federal Reserve Coin Inventory. As part of that inventory, quarters were stored in ballistic bags, each containing $50,000. The bags were stored on skids inside Brink’s Coin Room.
An April 2014 audit of the Federal Reserve Coin Inventory revealed that four of the ballistic bags contained beads and only $1,000 in quarters. The quarters were placed so they would be visible through a plastic window in the neck of each bag.
An investigation revealed that on Sunday, Feb. 16, 2014, not a scheduled workday for Dennis, he entered Brink’s and collected four empty skids and four empty ballistic bags, which he filled with beads. He then placed the skids and the bags inside the coin room. Between Jan. 1, 2014, and Feb. 20, 2014, his last day of employment at Brink’s, Dennis stole the 784,000 quarters totaling $196,000.
The maximum penalty for bank theft is 10 years in prison and a $250,000 fine.
The FBI investigated the case, which Assistant U.S. Attorney Henry Cornelius is prosecuting.