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18 April 2016
Missouri Man Pleads Guilty to Arson at Mosque and Attempted Arson at Planned ParenthoodRead the Press Release
Jedediah Stout, 32, of Joplin, Missouri, pleaded guilty in the Western District of Missouri today to the arson of a Joplin mosque and two attempted arsons of a Planned Parenthood clinic in Joplin, announced Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division, and U.S. Attorney Tammy Dickinson of the Western District of Missouri.
Stout pleaded guilty before U.S. Magistrate Judge David P. Rush of the Western District of Missouri to a four-count information that charges him with one count of damage to the Islamic Society of Joplin mosque, two counts of arson at a Planned Parenthood facility in Joplin and one count of violating the Freedom of Access to Clinic Entrances Act. He remains in federal custody without bond.
Stout, who told investigators that he did not like Islam as a religion, pleaded guilty to setting a fire that destroyed the Islamic Society of Joplin mosque on Aug. 6, 2012. The mosque served families from neighboring states, many of whom provided funding for the operation of the mosque. As a direct result of the fire, many donations made during the Muslim holy period of Ramadan were destroyed.
Stout admitted that he committed the mosque arson using the same kind of incendiary device he later used in two Planned Parenthood arson attempts.
On Oct. 3 and Oct. 4, 2013, Stout was captured on surveillance cameras as he made consecutive attempts to set fire to the Planned Parenthood facility in Joplin. In both instances, he threw items containing an accelerant onto the roof of the facility and then ignited material attached to the accelerant. Stout was apprehended soon after the Planned Parenthood arson attempts. He admitted to investigators that he was responsible for both Planned Parenthood arson attempts and for the mosque arson. Stout further admitted that he targeted Planned Parenthood because they provide reproductive health care services.
“In pleading guilty, Stout admitted that he attempted to burn the Planned Parenthood because it provides reproductive health services, and that he set fire to the Islamic Society of Joplin mosque because of its religious character,” said Principal Deputy Assistant Attorney General Gupta. “The Justice Department will continue to vigorously prosecute violence against reproductive health services providers and crimes motivated by religious animus.”
“I am committed to protecting and preserving the Constitutional rights of all Americans,” said U.S. Attorney Dickinson. “The Islamic Society of Joplin and Planned Parenthood were direct victims of these acts of arson, along with those whom they serve. But our entire community is impacted by hate crimes that strike at the heart of the principles by which we all live in a democracy. We will not tolerate the use of violence by anyone who threatens others in the free exercise of their religious and civil rights.”
Under federal statutes, Stout is subject to a maximum sentence of 61 years in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the U.S. Probation Office.
The case was investigated by the FBI; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Missouri State Highway Patrol; and the Joplin Police Department. This case is being prosecuted by Assistant U.S. Attorney Jim Kelleher of the Western District of Missouri in conjunction with the Justice Department’s Civil Rights Division.
Stout Superseding Information
Stout Plea Agreement
Miami Resident Guilty of Receiving Child PornographyRead the Press Release
A Miami resident pled guilty to receiving child pornography.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Juan Perez, Director, Miami-Dade Police Department (MDPD), made the announcement.
On April 4, 2016, Kelly Lee Fisher, of Miami, pled guilty to receipt of child pornography, in violation of Title 18, United States Code, Section 2252(a)(2) and (b)(1). Fisher is scheduled to be sentenced on June 23, 2016 before United States Chief District Judge K. Michael Moore.
According to court documents, on February 16, 2016, law enforcement searched Fisher’s residence, pursuant to a federal warrant. During a search of Fisher’s bedroom, law enforcement found several electronic devices, a disconnected desk cable and an air conditioning vent with missing and partially removed screws. Law enforcement discovered that a Toshiba Satellite laptop had been secreted in the air conditioning vent. A preliminary forensic review of the laptop revealed hundreds of images of child pornography and child erotica.
A subsequent forensic analysis of the laptop revealed that the computer contained 20 videos and 3,903 picture files depicting minors engaged in sexually explicit conduct. Several of the children depicted in these videos and pictures are under twelve years of age. The forensic analysis further revealed that Fisher used GrabIt, a newsgroup client, to search for child pornography newsgroups. On February 11, 2016, Fisher received at least 11 movies containing child pornography through GrabIt.
This case was brought as part of Project Safe Childhood (PSC), a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about the Project Safe Childhood initiative and for information regarding Internet safety, please visit www.justice.gov/psc.
Mr. Ferrer commended the investigative efforts of the FBI and MDPD. The case is being prosecuted by Assistant United States Attorney Joshua S. Rothstein.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Miami Physician Sentenced to 108 Months in Prison for His Role in $30 Million Health Care Fraud SchemeRead the Press Release
A Miami physician was sentenced today to 108 months in prison for his role in a Medicare fraud scheme that caused approximately $30 million in losses.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Division and Special Agent in Charge Shimon R. Richmond of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office made the announcement.
Henry Lora, 51, was sentenced by U.S. District Judge Federico A. Moreno of the Southern District of Florida, who also ordered Lora to pay $30,278,542 in restitution and to forfeit the same amount. Lora pleaded guilty in February 2016 to one count of conspiracy to commit health care fraud and one count of conspiracy to defraud the United States, receive health care kickbacks and make false statements relating to health care matters.
According to admissions made as part of his plea agreement, Lora was the medical director of Merfi Corporation, a Miami-area clinic that employed physicians, physician assistants and other medical professionals. Lora admitted that in exchange for kickbacks and bribes, he and his co-conspirators wrote prescriptions for home health care and other services for Medicare beneficiaries that were not medically necessary or not provided. Lora and his co-conspirators also falsified patient records to make it appear as if the beneficiaries qualified for these services, he admitted.
Lora admitted that his and his co-conspirators’ actions caused multiple Miami-Dade home health care agencies and other providers to bill Medicare for services that were not medically necessary or not provided, and that Medicare made payments on these fraudulent claims.
In March 2014, Isabel Medina, the owner of Merfi, who was charged separately, was sentenced to nine years in prison for conspiracy to commit health care fraud.
The FBI and HHS-OIG investigated the case, which was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. Fraud Section Trial Attorney A. Brendan Stewart prosecuted the case.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged over 2,300 defendants who collectively have billed the Medicare program for over $7 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.
Mexican National Arrested in New Mexico Based on DEA Seizure of Almost Four Pounds of HeroinRead the Press Release
ALBUQUERQUE – Juan Francisco Cruz-Neri, 23, of Mexico City, Mexico, made his initial appearance today in federal court in Albuquerque, N.M., on a criminal complaint charging him with possessing almost four pounds of heroin with intent to distribute. Cruz-Neri remains in federal custody pending a preliminary hearing and a detention hearing scheduled for April 19, 2016.
Cruz-Neri was arrested at the Greyhound Bus Station in Albuquerque on April 15, 2016, after the DEA allegedly found 1.70 kilograms (3.80 pounds) of heroin concealed in his backpack.
If convicted of the charge in the criminal complaint, Cruz-Neri faces a statutory penalty of a mandatory minimum of ten years and a maximum of life in federal prison. Charges in criminal complaints are merely accusations, and defendants are presumed innocent unless found guilty beyond a reasonable doubt.
This case was investigated by the Albuquerque office of the DEA. The case is being prosecuted by Assistant U.S. Attorney Rumaldo Armijo as part of the New Mexico Heroin and Opioid Prevention and Education (HOPE) Initiative was launched in January 2015 by the UNM Health Sciences Center and the U.S. Attorney’s Office in response to the national opioid epidemic which has had a disproportionately devastating impact on New Mexico. Opioid addiction has taken a toll on public safety, public health and the economic viability of our communities. Working in partnership with Bernalillo County, the Albuquerque City Council, DEA, Healing Addiction in our Community (HAC) and other community stakeholders, HOPE’s principal goals are to protect our communities from the dangers associated with heroin and opioid painkillers and reducing the number of opioid-related deaths in New Mexico.
The HOPE Initiative is comprised of five components: (1) prevention and education; (2) treatment; (3) law enforcement; (4) reentry; and (5) strategic planning. HOPE’s law enforcement component is led by the Organized Crime Section of the U.S. Attorney’s Office and the DEA in conjunction with their federal, state, local and tribal law enforcement partners. Targeting members of major heroin and opioid trafficking organizations for investigation and prosecution is a priority of the HOPE Initiative. Learn more about the New Mexico HOPE Initiative at http://www.HopeInitiativeNM.org.
Meth Dealer and Money Launderer Sentenced in Federal CourtRead the Press Release
United States Attorney Kenyen R. Brown of the Southern District of Alabama announced that Marlon Alberto Chirinos-Saleno, 32, a citizen of Honduras, was sentenced today in federal court to the statutory minimum mandatory sentence of 120 months for his participation in a drug trafficking organization operating between Texas and Alabama. Chirinos pled guilty to conspiracy to possess with intent to distribute methamphetamine and conspiracy to launder money in October of 2015.
At the sentencing hearing today, the prosecution presented evidence to support certain guideline enhancements, including testimony that a stolen gun was seized from Chirinos’ residence in Austin, Texas, when he was arrested on the charges last May. Chirinos gave a statement to Homeland Security agents that he bought the gun as protection against a death threat which resulted from a drug deal gone wrong. Two of Chirinos’ co-defendants testified against him at the hearing, establishing that Chirinos held a gun to one of them and that he directed their activities in obtaining the drugs in Texas, transporting them to Mobile, distributing them here and getting the drug money back to Texas. When approximately $57,000 in drug proceeds was seized from a co-defendant, Chirinos opened bank accounts in the names of others which were used to make cash deposits. The evidence at the hearing showed that the drug money was deposited in Mobile into the accounts controlled by Chirinos, and he would immediately have the money withdrawn in Austin, Texas, and at other locations as necessary to pay for more drugs. Through the conspiracy, Chirinos and the others distributed at least six pounds of methamphetamine and 200 pounds of marijuana. Approximately $161,000 in drug proceeds was laundered through the bank accounts.
United States District Court Judge Kristi K. Dubose found that the prosecution evidence established that Chirinos occupied a position of leadership and that the weapon was possessed in connection with the drug trafficking activities. The judge imposed the statutory minimum sentence of 120 months. She also ordered a five-year term of supervised release to follow his release from custody, but further ordered that he be turned over to immigration officials for consideration of deportation when he is released. No fine was imposed but Chirinos was ordered to pay $200 in special mandatory assessments.
The investigation was conducted by the Mobile County Sheriff’s Office, the Department of Homeland Security Investigations, and the Bureau of Alcohol, Tobacco, Firearms and Explosives. It was prosecuted in the United States Attorney’s Office by Assistant United States Attorney Gloria Bedwell.Member of the Simple City Criminal Organization Pleads Guilty to a Racketeering ConspiracyRead the Press Release
Greenbelt, Maryland – Stefon Janey, a/k/a “Stef,” and “Stef Luva,” age 23, of Marlow Heights, Maryland pleaded guilty today to conspiring to participate in the activities of the Simple City Criminal Organization (SCCO), a racketeering enterprise engaged in fraud and related activity in connection with access devices, wire fraud, bank fraud and interstate transportation of stolen property.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation; Chief Hank Stawinski of the Prince George’s County Police Department; and Chief J. Thomas Manger of the Montgomery County Police Department.
According to his plea agreement, from at least 2009 to July 2015, the conspirators met on a regular basis, and planned criminal activity, including vehicle theft, the interstate transportation of stolen property, identity theft and access device fraud. The SCCO received money and income from criminal activities, including the sale of motor vehicles and stolen property by other SCCO members, as well as bank fraud, wire fraud and access device fraud.
More specifically, on March 30, 2015, Janey and a coconspirator attempted to steal money from two ATMs located on Piney Orchard Parkway in Odenton, Maryland.
On April 18, 2015, Janey and another coconspirator robbed a gas station located on Baltimore Avenue in Beltsville, Maryland. They used a crowbar to forcibly enter the employee vestibule area, and took an employee’s cell phone and money from the cash register. Janey and the coconspirator also forced opened an ATM in the gas station. They fled in an Acura MDX that had previously been stolen in Prince George’s County.
On May 14, 2014, Janey and two coconspirators attempted to steal money from an ATM located in a furniture warehouse in College Park, Maryland.
Janey faces a maximum sentence of 20 years in prison. U.S. District Judge George J. Hazel has scheduled sentencing for July 26, 2016 at 9:30 a.m.
Co-defendant Jessica Rubio, age 38, of Washington, D.C. previously pleaded guilty to her participation in the racketeering conspiracy and to aggravated identity theft. Judge Hazel has scheduled her sentencing for June 3, 2016.
United States Attorney Rod J. Rosenstein praised the FBI, Prince George’s County Police Department, Montgomery County Police Department and the members of the Washington Area Vehicle Enforcement Unit for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys Thomas M. Sullivan and Nicolas A. Mitchell, who are prosecuting the case.
Massachusetts Man Pleads Guilty to Fentanyl Distribution ConspiracyRead the Press Release
CONCORD, N.H. – Euris Daniel Paulino Guerrero, 24, a citizen of the Dominican Republic residing in Lawrence, Massachusetts, pleaded guilty in United States District Court for the District of New Hampshire to two counts of distribution of the Schedule II controlled substance fentanyl and one count of conspiracy to distribute fentanyl, announced United States Attorney Emily Gray Rice.
During the spring and summer of 2015, law enforcement officers investigated a drug trafficking organization operating in Massachusetts and Southern New Hampshire. As part of the investigation, cooperating individuals and an undercover law enforcement officer purchased heroin, fentanyl, and oxycodone from the defendant and his co-conspirators. Four sales occurred in Massachusetts and two, on July 29, 2015 and August 12, 2015, took place in Salem, New Hampshire. Lab results have confirmed that over 140 grams of the substance sold contained fentanyl and additional quantities remain to be tested. On September 17, 2015, the Drug Enforcement Administration executed search warrants at three residences in Lawrence, Massachusetts associated with the organization. In one residence, officers located over 400 grams of fentanyl, an instrument used to compress drugs into ten-gram quantities for sale, blenders, and other packaging materials.
Guerrero will be detained pending sentencing, which is presently scheduled for July 14, 2016 at 10:00 a.m. The statutory maximum sentence for the conspiracy charge is forty years in prison and criminal fines of up to $5,000,000. Each distribution charge carries a statutory maximum sentence of twenty years in prison and criminal fines of up to $1,000,000. Guerrero’s actual sentence will be determined by the court at sentencing after a presentence investigation report is completed.
The case was investigated by the Drug Enforcement Administration and is being prosecuted by Assistant United States Attorneys Georgiana L. Konesky and John J. Farley.
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Martin County Convicted Felons Sentenced to Prison for Possessing Firearms at Jensen Beach Indoor Firing RangeRead the Press Release
Two Martin County convicted felons were sentenced to prison for unlawfully possessing firearms and ammunition at an indoor firing range in Jensen Beach, Florida.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Carlos A. Canino, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), Miami Field Office, David Dyess, Chief, Stuart Police (SPD), and William D. Snyder, Sheriff, Martin County Sheriff’s Office (MCSO), made the announcement.
Aldrick James Lott, 30, and John Robert Rucker, Jr., 46, both of Stuart, were sentenced to imprisonment by U.S. District Court Judge Robin L. Rosenberg on April 15, 2016. On January 20, 2016, Rucker pleaded guilty to being a felon in possession of firearms, in violation of Title 18, United States Code, Section 922(g)(1). Rucker was sentenced to 57 months in prison, to be followed by 3 years of supervised release. On January 26, 2016, Lott pleaded guilty to being a felon in possession of firearms and ammunition, in violation of Title 18, United States Code, Sections 922(g)(1) and 924(e). Lott was sentenced to 185 months in prison, to be followed by 3 years of supervised release.
According to the court record, on November 7, 2015, Lott and Rucker, entered a gun shop and indoor shooting range in Jensen Beach, Florida. During their visit, Lott and Rucker were recorded on video surveillance shooting targets with multiple firearms, including a Glock 30 .45ACP caliber pistol, Smith and Wesson M&P40 .40 caliber pistol, and High-Point 9mm pistol. The Glock and Smith and Wesson pistols were left at the store for cleaning, examined by law enforcement and determined to have been stolen.
On December 1, 2015, federal and local law enforcement agencies executed three search warrants, on residences connected to Lott and Rucker. Law enforcement recovered the High-Point 9mm pistol, a second firearm, and various rounds of ammunition from one home connected to Lott. From a second residence connected to Lott, officers recovered a magazine and ammunition matching the Smith and Wesson M&P40 .40 caliber pistol. From a residence connected to Rucker, officers recovered narcotics.
Mr. Ferrer commended the investigative efforts of ATF, SPD, MCSO, Federal Bureau of Investigation, Drug Enforcement Administration and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. This case was prosecuted by Assistant U.S. Attorney Carmen Lineberger.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
MS-13 Member Sentenced to 45 Years in Prison for Double-MurderRead the Press Release
Earlier today at the federal courthouse in Central Islip, New York, Rene Mendez Mejia, also known as “Zorro,” a member of La Mara Salvatrucha, also known as the MS-13 street gang, was sentenced to 45 years in prison by United States District Judge Joseph F. Bianco.
As established in prior filings, court proceedings, and sentencing memoranda, Mejia and two other MS-13 members, Adalberto Ariel Guzman and Juan Garcia, shot and killed 19-year-old Vanessa Argueta and her two-year-old son, Diego Torres, in Central Islip, New York, on February 5, 2010, after luring them to a secluded wooded area. Mejia and Garcia shot Argueta in the head and chest, respectively, and Guzman shot Torres twice in the head. Mejia and other MS-13 members, including MS-13 leader, Heriberto Martinez, Guzman, and Garcia had plotted to kill Argueta because they believed she had disrespected the MS-13 by sending rival gang members to attack Garcia.
After committing the murders, Mejia and his co-conspirators fled to El Salvador. Guzman and Mejia were arrested in May 2010 when they returned to the United States, but Garcia remained a fugitive for four years until March 2014, when, after being placed on the FBI’s Ten Most Wanted Fugitives List, he surrendered to law enforcement authorities in Nicaragua, waived extradition, and was returned to the United States for prosecution. Mejia pled guilty on June 15, 2011.
The sentencing was announced by Robert L. Capers, United States Attorney for the Eastern District of New York, Diego Rodriguez, Assistant Director-in-Charge, FBI, New York Field Office, and Timothy Sini, Commissioner, Suffolk County Police Department.
“Mejia and his fellow MS-13 members brutally and senselessly executed a young woman and her two-year-old child. While nothing can reverse this tragedy, we hope that today’s sentence and the convictions and sentencings of Mejia’s co-conspirators have brought the victims’ families some measure of justice and comfort,” stated United States Attorney. “My Office and our law enforcement partners will continue to be vigilant and aggressively prosecute the MS-13 and other criminal organizations who unleash violence on our communities.” United States Attorney Capers expressed his sincere gratitude to the members of the FBI’s Long Island Gang Task Force for their tenacious investigation and unwavering commitment to bring Mejia and his co-conspirators to justice for the Argueta and Torres murders.
“As the last defendant is sentenced for the brutal murders of a young woman and her toddler son by MS-13 gang members, we hope the victims’ family can finally feel justice has been served. The FBI is committed to working with our partners to not only root-out gangs in our communities but also bring their crimes to justice no matter how long it takes,” said FBI Assistant Director-in-Charge Rodriguez.
“This prosecution exemplifies the ruthless and senseless violence committed at the hands of MS-13 gang members, which threatens the very fabric of our communities. The Suffolk County Police Department will continue to aggressively work with our law enforcement partners to bring these violent criminals to justice,” stated Commissioner Sini.
Mejia’s three co-conspirators, Martinez, Guzman, and Garcia were also arrested and indicted in connection with the Argueta and Torres murders. Martinez was convicted in March 2013, following a six-week trial, in connection with the Argueta murder, as well as the March 6, 2010, murder of Nestor Moreno in Hempstead, New York, and the March 17, 2010 murder of Mario Alberto Canton Quijada in Far Rockaway, New York, and later sentenced to life in prison, plus 60 years. Guzman was convicted on charges relating to the Argueta and Torres murders in September 2013, following a three-week trial, and later sentenced to life in prison, plus 35 years. Garcia pled guilty and was sentenced to life in prison for his role in the Argueta and Torres murders.
The convictions of Mejia and his co-defendants are the latest in a series of federal prosecutions by the United States Attorney’s Office for the Eastern District of New York targeting members of the MS-13, a violent international criminal organization. The MS-13’s leadership is based in El Salvador and Honduras, but the gang has thousands of members across the United States, comprised primarily of immigrants from Central America. With numerous branches, or cliques, the MS-13 is the largest and most violent street gang on Long Island. Since 2003, hundreds of MS-13 members, including dozens of clique leaders, have been convicted on federal felony charges in this district. A majority of those MS-13 members have been convicted on federal racketeering charges for participating in murders, attempted murders, and assaults. Since 2010 alone, this Office has obtained indictments charging MS-13 members with carrying out more than 30 murders, and has convicted dozens of MS-13 leaders and members in connection with those murders. These prosecutions are the product of investigations led by the FBI’s Long Island Gang Task Force, comprising agents and officers of the FBI, Nassau County Police Department, Nassau County Sheriff’s Department, Suffolk County Probation, Suffolk County Sheriff’s Department, Rockville Centre Police Department, and Suffolk County Police Department.
The government’s case is being prosecuted by Assistant United States Attorneys John J. Durham and Raymond A. Tierney from the Office’s Long Island Criminal Division.
The Defendant:
RENE MENDEZ MEJIA
Age: 22
East Patchogue, New YorkE.D.N.Y. Docket No. 10-CR-074 (JFB)
Lakewood man writes off expenses, including use of yacht and luxury world travel, to underreport income by $2 millionRead the Press Release
A Lakewood man was charged in federal court for taking improper write-offs and not reporting more than $2 million in taxable income, said Carole S. Rendon, Acting United States Attorney for the Northern District of Ohio, and Kathy Enstrom, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office.
Thomas G. Klocker, 47, was charged via criminal information with four counts of tax evasion. The counts cover the tax years 2007 through 2010.
“Nobody likes paying taxes, but we all have to pay our fair share, which includes being honest about deductions and expenses,” Rendon said. “Those who underreport their income and take improper deductions will be held accountable.”
“As this tax filling season comes to a close, we are reminded of our collective duty to accurately file and pay our taxes,” Enstrom said. “Those who willfully abscond from this duty will be pursued and brought to justice.”
Klocker was the sole shareholder and operator of All Metal Sales (AMS) in Westlake. He also operated TT Charter Leasing, which was in the business of chartering the luxury yacht “Tommy Time”, according to the information.
Klocker diverted corporate funds from AMS for his own use to benefit his personal lifestyle and avoid personal income liabilities between 2007 and 2010, according to the information.
For example, Klocker diverted funds from AMS to construct a waterfront residence in Lakewood and to maintain his 68’ Sunseeker yacht, as well as to pay for luxury travel and to make cash withdrawals. He reported substantial business losses arising from the operating costs and expenses arising from the personal use of the TT Charter Leasing yacht, according to the information.
He also misrepresented his personal expenses entered into AMS’ books and records by falsely describing them as legitimate business expenses. Klocker also provided false information to his tax-return preparers about expenses he described as business-related which were, in fact, personal in nature – including luxury travel with his family, according to the information.
Klocker underreported his taxable income by more than $2 million during tax years 2007, 2008, 2009 and 2010. He owes at least an additional $611,000 in taxes for that period, according to the information.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
A charge is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
This case is being prosecuted by Assistant U.S. Attorney Robert J. Patton following an investigation by the Internal Revenue Service – Criminal Investigations, with assistance from the Federal Bureau of Investigation – Cleveland Field Office.
Justice Department Sues to Stop Miami Tax Return Preparer from Preparing Federal Tax Returns for OthersRead the Press Release
Return Preparer Allegedly Claimed Fraudulent Education, Fuel Credits
Rose M. Chazulle, a tax return preparer in Miami has prepared fraudulent federal tax returns that claim education and fuel credits to which her clients are not entitled, according to a civil lawsuit filed by the Justice Department today. The suit seeks to bar Chazulle and her company, RMC Professional Services Corporation, from preparing federal tax returns for others.
According to the complaint, Chazulle prepared federal income tax returns for customers that falsely claimed refundable credits, including American Opportunity Tax Credit and Lifetime Learning Credit. Chazulle included the false education credits for customers who did not incur educational costs and otherwise did not qualify for this credit, the complaint alleges. In addition, the complaint states Chazulle prepared tax returns that falsely claimed:
- Fuel tax credits for customers who had no businesses of any kind, even though the credit can only be taken when fuel is used for certain business purposes or to operate a school bus;
- Fabricated business losses, claimed on Schedule C, Profit or Loss from Business, even though the customers did not have a business; and
- Wages described as household help income in order to falsely claim a larger Earned Income Tax Credit than the customer otherwise would have been able to claim.
The complaint estimates that Chazulle’s conduct cost the United States over $14 million for the tax years 2011 to 2013.
Return preparer fraud is one of the Internal Revenue Service’s (IRS) Dirty Dozen Tax Scams for 2016. The IRS has some tips on their website for choosing a tax preparer and has launched a free directory of federal tax preparers. In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Justice Department Asks Federal Court to Shut Down South Florida Tax Return PreparerRead the Press Release
A Broward County, Florida, man prepares fraudulent tax returns and should be barred from preparing federal tax returns for others, according to a civil complaint filed by the Justice Department today.
The civil complaint against Eli St. Phard was filed in the U.S. District Court for the Southern District of Florida. The complaint alleges that St. Phard prepares income tax returns that fraudulently understate his customers’ tax liabilities by falsely claiming deductions for business expenses his customers never incurred, fraudulently overstating his customers’ claims for refunds by falsely claiming education or fuel tax credits to which his customers are not entitled, or both. According to the complaint, the Internal Revenue Service (IRS) audited 340 of the more than 3,132 returns St. Phard prepared since 2009 and found that St. Phard understated the tax owed on all but five of the 340 returns—a total of more than $1.8 million in understatements. As a result of St. Phard’s fraudulent activities, many of his customers are now liable for significant tax deficiencies, penalties and interest, the complaint alleges.
Return preparer fraud is one of the IRS’s Dirty Dozen Tax Scams for 2016. The IRS has some tips on their website for choosing a tax preparer, and has launched a free directory of federal tax preparers. In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Jamestown Man Is Sentenced for Making False StatementsRead 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 Tyrell Fuqua-Hayes, 38, of Jamestown, NY, who was convicted of making false statements and representations to the FBI, was sentenced to 27 months in prison by Chief U.S. District Judge Frank P. Geraci.
Assistant U.S. Attorney Tiffany H. Lee, who handled the case, stated that in January 2015, Hayes alleged that he met a man who was arrested in another federal case while they were in custody together at the same jail. The defendant claimed that the man provided him with contact information and advised Hayes that he would be reaching out to him.
In May 2015, Hayes advised the Federal Bureau of Investigation that he was receiving text messages from the man he met in jail indicating that the man wanted to pay the defendant $5000 to kill witnesses in that man’s case. The defendant later admitted he created the text messages himself and that lied about the recent conversations between the man and himself.
The sentencing is the result of an investigation by the Federal Bureau of Investigation Child Exploitation Task Force which includes the Rochester Police Department, the Monroe County Sheriff’s office and Immigration and Customs Enforcement, Homeland Security Investigations.
Highlands County Man Sentenced to 30 Years in Prison for Distributing, Receiving and Possessing Child PornographyRead the Press Release
A resident of Highlands County, Florida was sentenced to 30 years in prison, by United States District Judge Robin L. Rosenberg, for distributing, receiving, and possessing images that depicted the sexual exploitation of minors.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Robert C. Hutchinson, Acting Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), Miami Field Office, made the announcement.
Martin Jay Van Deurzen, 60, of Lake Placid, pleaded guilty on January 27, 2016, to two counts of distribution of material containing visual depictions of sexual exploitation of minors, in violation of Title 18, United States Code, Sections 2252(a)(2) and (b)(1); receipt of material containing visual depictions of sexual exploitation of minors, in violation of Title 18, United States Code, Sections 2252(a)(2) and (b)(1); and possession of matter containing visual depictions of sexual exploitation of minors, in violation of Title 18, United States Code, Sections 2252 (a)(4)(B) and (b)(2). On April 15, 2016, Van Deurzen was sentenced to the statutory maximum term of 240 months in prison for the distribution and receipt of visual depictions of sexual exploitation of minors, to be followed by the statutory maximum term of 120 months in prison for possession of visual depictions of sexual exploitation of minors. Upon completion of his prison term, Van Deurzen will be placed on supervised release for the remainder of his life and is ordered to register as a sex offender.
According to court documents and information disclosed during court proceedings, on March 6, 2015, an HSI Special Agent based in Delaware, using a computer connected to the Internet, utilized a publicly available P2P file sharing program and observed numerous files containing visual depictions of the sexual exploitation of minors. The agent was able to download 50 image files from an IP address assigned to Van Deurzen’s registered account in Lake Placid, Florida. On November 16, 2015, an HSI Taskforce Agent in Martin County discovered that an individual, determined to be Van Deurzen, was logged into the P2P network and engaged in a one-on-one chat, where he discussed the sharing of child pornography and his personal collection of the sexually explicit images. The agent observed numerous visual depictions of the sexual exploitation of minors in Van Deurzen’s shared folders and downloaded several of the files directly from the defendant’s computer.
On November 24, 2015, HSI agents executed a search warrant at Van Deurzen’s residence in Lake Placid. During the search Van Deurzen identified his Dell laptop computer, in the living room area, which was on and actively sharing pictures and videos depicting minors engaged in sexually explicit conduct. A forensic review of Van Deurzen’s computer revealed hundreds of thousands of pictures and videos depicting minors engaged in sexually explicit conduct. Many of the minors were prepubescent and under the age of 12 years of age, engaged in sexually explicit conduct, including sado-masochistic, bondage and bestiality. Also on Van Deurzen’s computer were images of the defendant sexually abusing a minor.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Mr. Ferrer commended the investigative efforts of ICE-HSI. This case was prosecuted by Assistant U.S. Attorney Carmen Lineberger.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Hagerstown Man Sentenced to Eight Years in Prison for Conspiracy to Distribute HeroinRead the Press Release
Baltimore, Maryland – U.S. District Judge Richard D. Bennett sentenced Cory Allen Kline, age 32, of Hagerstown, Maryland today to eight years in prison, followed by three years of supervised release, for conspiracy to distribute heroin.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Assistant Special Agent in Charge Don A. Hibbert of the Drug Enforcement Administration, Baltimore District Office; Washington County Sheriff Douglas Mullendore; and Acting Hagerstown Police Chief Paul Kifer.
Assistant Special Agent in Charge Don A. Hibbert stated, “ A successful prosecution in cases like this one, where the distribution of heroin is directly linked to a fatality, shows that DEA is not only committed to investigating large scale traffickers, but is also dedicated to working with our local counterparts to make sure that dealers in death are held accountable.”
According to Kline’s plea agreement, early on April 13, 2015 Kline and a co-defendant went to a residence in Hagerstown, Maryland with a 19-year old woman from Clear Spring, Maryland. The woman was a recovering heroin addict who had recently been released from jail. While at the residence, Kline and his co-defendant agreed to provide heroin to the woman. After injecting the heroin, the woman became very high. Kline left the residence sometime before 6:00 a.m. The woman left the residence in her car at about 6:15a.m. and spoke to another individual on her cell phone from that time until approximately 7:06 a.m. on April 13. According to this individual, the victim stated she was very high and did not feel right, and the individual could hear the victim throwing up. The victim reported driving to a convenience store parking lot, and then to a nearby church. Toward the end of the call, the victim began nodding off and then stopped speaking. The victim’s body was discovered the following day in her car in a church parking lot in Hagerstown. The medical examiner reported that the cause of death was heroin intoxication. There were no drugs or drug paraphernalia found inside the vehicle, nor does the victim’s cell phone reflect any completed calls or outgoing messages after 7:06 a.m. on April 13. Kline admitted that his distribution of heroin resulted in the victim’s death.
United States Attorney Rod J. Rosenstein commended the DEA and the Washington County Narcotics Task Force for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Christina Hoffman and Robert R. Harding, who prosecuted the case.
Granby Man Sentenced for Child PornRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Granby, Mo., man was sentenced in federal court today for receiving child pornography over the Internet.
Kyle Christopher Largen, 30, of Granby, was sentenced by U.S. District Judge M. Douglas Harpool to nine years in federal prison without parole. Today’s sentence must be served consecutively to any sentence Largen receives in state court. The court also ordered Largen to pay $1,000 in restitution to one of the victims whose images of child sexual abuse he received.
On Oct. 20, 2015, Largen pleaded guilty to receiving child pornography.
The case began on Feb. 25, 2015, when a detective with the Joplin, Mo., Police Department became involved in a child sexual abuse investigation regarding Largen following a child abuse hotline report. On April 15, 2015, law enforcement officers executed a search warrant at Largen’s residence and seized his laptop, which contained images of child pornography. According to court documents, Largen possessed 1,769 images of child pornography and 235,554 images of pornographic anime, many of which depicted sadistic or masochistic conduct.
According court documents, Largen was showing pornography to two 4- and 5-year-old children.
This case was prosecuted by Assistant U.S. Attorney Ami Harshad Miller. It was investigated by the Southwest Missouri Cyber Crime Task Force and the Joplin, Mo., Police Department.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Four Restaurant Owner/Managers in State College Area Sentenced and Property Forfeited in Illegal Alien Harboring CaseRead the Press Release
WILLIAMSPORT - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that four restaurant owner/managers in the State College area were sentenced on April 15, 2016 by United States District Court Judge Matthew W. Brann in Williamsport in a case involving conspiracy to transport, harbor and conceal illegal aliens.
Jing Mei Jiang, sentenced to 15 months’ imprisonment and ordered to report to prison on May 16, 2016. The other three defendants are Xin Xing Jiang; Yan Jin Jiang; and Yu Mei Chen. All three were sentenced to two years’ probation. All four defendants pleaded guilty in September 2015. All are residents of Boalsburg, Pennsylvania.
Four other defendants previously pleaded guilty in August 2015 and were sentenced to two years’ probation: Zue Jiang; Jian Bin Chen; Yong Cheng Chen; and Hua Zhen Dong. All are resident of State College, Pennsylvania.
According to U.S. Attorney Peter Smith, charges were filed in July 2015 in U.S. District Court in Harrisburg against the eight restaurant owners and managers accusing them of conspiring to transport, harbor and conceal illegal aliens to work in their restaurants. Jing Mei Jiang, identified as the leader of the conspiracy, was also charged with defrauding the United States and the Commonwealth of Pennsylvania by underreporting the actual number of employees in audit and tax documents and by creating falsified financial records on his Employer’s Quarterly Report of Wages Paid to each employee.
Jing Mei Jiang and his co-conspirators engaged in recruiting unauthorized aliens to work in restaurants and transporting the aliens by commercial buses, vans and other vehicles to and from restaurants in the State College area, where they would work and be housed during their employment.
The workforce consisted of Hispanic and Chinese aliens from Mexico, Guatemala, Thailand and China. The workers were recruited and employed by the defendants for commercial advantage and private financial gain. Unauthorized alien workers were hired to staff restaurant kitchen operations, thereby cutting costs and maximizing profits. As part of the conspiracy, the aliens were paid in cash, at a rate well below the minimum wage. State and/or federal taxes were not withheld from wages, unauthorized aliens were not required to present documents establishing identity and/or employment eligibility, housing and transportation was provided and costs were shared among the conspirators to maximize profits, and fraudulent documents relating to unemployment compensation were filed.
Judge Brann ordered the following assets forfeited, consisting of property or cash directly tied to the criminal activity:
210 Limerock Terrace, State College, PA
458 East College Avenue, Unit 211, State College, PA
458 East College Avenue, Unit 406, State College, PA
691 Westerly Parkway, State College, PA
$21,890 in cash seized from the China Dragon Restaurant, State College, PA
$43,108 in cash seized from 210 Limerock Terrace, State College, PA
The case is part of an investigation by Homeland Security Investigations, the Pennsylvania Office of the Attorney General, and the U.S. Department of Labor, Office of Inspector General assisted by the State College Police Department. Assistant U.S. Attorneys William A. Behe and Gordon Zubrod, and Special Assistant U.S. Attorney Robert LaBar of the Pennsylvania Attorney General’s Office prosecuted the case.
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Fort Myers Man Sentenced to More Than Seven Years in Prison for Illegal Possession of A FirearmRead the Press Release
Fort Myers, Florida – United States Attorney A. Lee Bentley, III announces that U.S. District Judge Sheri Polster Chappell today sentenced Basilio Amaury Bron, Jr. (35, Fort Myers) to seven years and three months in federal prison for possessing a firearm as a convicted felon. The Court also ordered him to forfeit the handgun and ammunition that had been used in the offense.
Bron was found guilty on November 12, 2015, following a bench trial before Judge Chappell.
According to court documents, an officer from with the Fort Myers Police Department (FMPD) Violent Crimes Task Force observed Bron discard litter from the passenger window of a vehicle. FMPD officers stopped the vehicle and learned that Bron had an active warrant for unpaid child support. During the course of the traffic stop, officers also discovered that Bron was carrying a .25 caliber handgun, loaded with three rounds, in his front waistband.
At the time of the incident, Bron had four previous felony convictions and was therefore prohibited from possessing a firearm or ammunition under federal law.
This case was investigated by the Federal Bureau of Investigation’s Violent Crimes Task Force, which includes members of the FMPD Violent Crimes Task Force, with additional assistance provided by the Bureau of Alcohol, Tobacco, Firearms and Explosives. It was prosecuted by Assistant United States Attorney David G. Lazarus.
This is another case prosecuted as a part of the Department of Justice’s “Project Safe Neighborhoods” Program - a nationwide, gun-violence reduction strategy. United States Attorney A. Lee Bentley, III, along with Regina Lombardo, Special Agent in Charge, ATF, is coordinating the Project Safe Neighborhoods effort here in the Middle District of Florida in cooperation with federal, state, and local law enforcement officials.
Former President of St. Louis Law Enforcement Officer Association Indicted on Fraud ChargesRead the Press Release
St. Louis, MO – Darren Randal Wilson was indicted on multiple fraud charges involving his misappropriation of over $80,000 from the Ethical Society of Police, an association of black St. Louis police officers.
According to the indictment, Wilson was president of the Ethical Society of Police (ESOP) in 2013 and 2014. As president of ESOP, Wilson had signature authority over the ESOP bank account and accessed the funds in the account with checks and an ATM/debit card. The funds in the ESOP account consisted primarily of the monthly dues contributed by the police officer members of ESOP.
The indictment alleges that between July 2013 and December 2014, Wilson engaged in a fraud scheme to misappropriate money from the ESOP bank account and to use the money for his own purposes. To further the fraud scheme, Wilson transmitted some of the misappropriated money by Fed Wire, PayPal and Western Union wire transfers. To conceal his fraudulent activity, Wilson presented false information to ESOP officers and members.
Wilson was indicted by a federal grand jury on April 14 on nine felony counts of wire fraud. The indictment remained sealed until earlier today when the defendant surrendered to authorities.
Upon conviction, each count of the indictment carries a maximum penalty of 20 years in prison and/or a fine up to $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the Federal Bureau of Investigation and the St. Louis Metropolitan Police Department. Assistant United States Attorney Cristian M. Stevens is handling the case for the U.S. Attorney’s Office.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
Former High School Teacher Pleads Guilty to Distributing Child PornRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a former teacher at St. Elizabeth High School in St. Elizabeth, Mo., pleaded guilty in federal court today distributing child pornography.
Stephen Gregory Strobel, 26, of St. Elizabeth, pleaded guilty before U.S. Magistrate Judge Matt J. Whitworth to the charge contained in a Nov. 5, 2014, federal indictment.
In April 2014 a Wooster, Ohio woman discovered that her 13-year-old daughter had engaged in a sexually explicit Internet chat with Strobel. On May 12, 2014, investigators contacted Strobel at St. Elizabeth High School. Strobel admitted he had exchanged pornographic photos with the 13-year-old victim and that she had sent him pornographic photos and a video.
Strobel also told investigators that he had traded photos of underage girls with various people online. He never asked the ages of the children depicted, but estimated them to be between the ages of 13 and 15. Strobel estimated that he had received 15 photographs of underage children, the youngest being five or six years old. He stated that he had sent approximately 10 photos of underage children to other people and had also shared videos depicting underage children.
Investigators identified a video and approximately 500 images of child pornography on Strobel’s iPhone.
Under federal statutes, Strobel is subject to a mandatory minimum sentence of five years in federal prison without parole, up to a sentence of 20 years in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Jim Lynn. It was investigated by the Missouri State Highway Patrol, the FBI, the Ohio Attorney General’s Office and the Wayne County, Ohio, Sheriff’s Department.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Former Crawford County Man Charged with Possessing Child PornographyRead the Press Release
ERIE, Pa. - A former resident of Crawford County, Pennsylvania, has been indicted by a federal grand jury in Erie on a charge of violating federal laws relating to the sexual exploitation of children, United States Attorney David J. Hickton announced today.
The one-count indictment named Alan Thomas Rigby, 68, as the sole defendant.
According to the indictment presented to the court, Rigby possessed computer images depicting minors engaging in sexually explicit conduct.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
The law provides for a maximum total sentence of 20 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Christian A. Trabold is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation and the Pennsylvania State Police conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Former CFO of Granite Falls Industrial Contractor Charged with Embezzling More Than $5.7 MillionRead the Press Release
United States Attorney Andrew M. Luger today announced an information charging KIRSTEN ANN TJOSAAS, 38, for embezzling more than $5.7 million from Fagen, Inc. (Fagen), an industrial contracting company for which she served as Chief Financial Officer. TJOSAAS is charged with wire fraud and money laundering. The defendant is expected to appear at a later date before Judge Donovan W. Frank in U.S. District Court in St. Paul, Minn.
“As alleged in the information, Ms. Tjosaas carried on an egregious embezzlement scheme over an eight-year period, stealing millions from a family-owned business,” said U.S. Attorney Andrew Luger. “These charges reflect a clear violation of both the law and the trust her employer placed in her.”
According to the information, between 2006 and November 2015, TJOSAAS abused her authority as Corporate Controller and Chief Financial Officer of Fagen to issue at least 19 checks and make wire transfers totaling approximately $4.5 million from Fagen to Fairmont Investments, LLC (Fairmont), a Nebraska-based corporation controlled by the defendant.
According to the information, after registering Fairmont, TJOSAAS opened a bank account at Granite Falls Bank in the name of Fairmont for the purpose of embezzling money from Fagen. TJOSAAS signed these checks using the signature stamp of another Fagen executive without the authority or knowledge of that executive. The defendant also entered false entries into Fagen’s general ledger to disguise the illegitimate checks as payments to Fagen partners or payments to legitimate Fagen vendors. After depositing checks into the Fairmont account, TJOSAAS transferred the funds she had stolen into her own personal bank accounts. She used the illicit proceeds to buy five houses and other real estate in Florida, Minnesota, Tennessee, and Arizona, as well as at least three automobiles, two all-terrain vehicles, a motorcycle, a jet-ski, and a sailboat.
According to the information, TJOSAAS also fraudulently issued Fagen checks payable to another company. TJOSAAS had access to and control over the bank account of this company. Between June 2006 and November 2015, TJOSAAS issued approximately 25 fraudulent checks into this account, totaling more than $1.2 million.
This case is the result of an investigation conducted by the FBI.
Assistant U.S. Attorney Joseph H. Thompson is prosecuting the case.
Defendant Information:
KIRSTEN ANN TJOSAAS, 38
Granite Falls, Minn.
Charges:
- Wire fraud, 1 count
- Money laundering, 1 count
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
The charges contained in the information are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Former Army recruiter charged with theft of public moneyRead the Press Release
A former Army recruiter was charged with theft of public money, said Acting U.S. Attorney Carole S. Rendon.
Robert L. Lucks, 51, of Warsaw, was charged via a criminal information. On or about April 17, 2009, Lucks, a former Disabled Veteran Outreach Representative with the Ohio Department of Job and Family Services (ODJFS), used his former position to obtain personal identification information of a spouse of an ODJFS customer, to steal $1,000 of Department of Defense funds, according to the information.
To aid the military in its recruiting efforts, the Army National Guard established the Guard Recruiting Assistance Program (G-RAP). The program was designed to offer monetary recruiting incentives to part-time soldiers to identify and encourage individuals to serve in the Army National Guard and other military branches.
Lucks fraudulently submitted the personal information of a potential soldier through his online G-RAP account. The potential soldier did not provide her information to Lucks to be used for G-RAP. Lucks submitted fabricated details of his relationship with the potential soldier, in order to receive recruiting incentives to which he was not entitled. Because of the inappropriately procured personal information and fabricated relationship details Lucks submitted, he received $1,000 in money belonging to the United States to which he was not entitled, according to the information.
If convicted, the court will determine the defendant’s sentence after a review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum. In most cases, it will be less than the maximum.
This case is being prosecuted by Assistant U.S. Attorney Karrie Howard following an investigation by Major Procurement Fraud Unit, US Army CID.
An information is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.
Federal officials close review into the death of Wayne JonesRead the Press Release
WASHINGTON – The Justice Department announced today that there is insufficient evidence to pursue federal criminal civil rights charges against Martinsburg, West Virginia, Police Department (MPD) Officers in connection with the 2013 shooting death of Wayne Jones.
Officials from the U.S. Attorney’s Office of the Northern District of West Virginia and the Justice Department’s Civil Rights Division met today with the Jones family and their representatives to inform them of this decision.
Federal authorities conducted a comprehensive and independent review of the evidence related to the death of Jones, who was shot during a struggle with MPD officers on March 13, 2013. Federal authorities reviewed the evidence collected during the state investigation, including video recordings, witness interviews, physical evidence, officer statements and expert testimony.
The team of experienced federal prosecutors and federal authorities reviewed the evidence to determine whether the involved officers violated federal law by willfully using unreasonable force against Jones. Under the applicable federal criminal civil rights statute, prosecutors must establish, beyond a reasonable doubt, that a law enforcement officer willfully deprived an individual of a constitutional right. To establish willfulness, federal authorities must show that the officer acted with the deliberate and specific intent to do something the law forbids. This is the highest standard of intent imposed by law. Mistake, misperception, negligence and poor judgment are not sufficient to establish a federal criminal civil rights violation.
In this instance, federal authorities determined that the physical, testimonial and circumstantial evidence was insufficient to refute the subjects’ claims that they believed they had to fire their weapons while acting in self-defense or in defense of others. Accordingly, the federal review of this incident has been closed without prosecution. This decision is limited strictly to an application of the high legal standard required to prosecute the case under the federal civil rights statute; it does not reflect an assessment of any other aspect of the incident that led to Jones’s death.
The U.S. Attorney’s Office of the Northern District of West Virginia, the Civil Rights Division and the FBI are committed to investigating allegations of civil rights violations by law enforcement officers and will continue to devote the resources required to ensure that all allegations of serious civil rights violations are fully and completely investigated. The department will aggressively prosecute criminal civil rights violations whenever there is sufficient evidence to do so.
Federal Jury Convicts Head of Schaumburg Home Health Company in Scheme to Fraudulently Bill Medicare for Unnecessary CareRead the Press Release
CHICAGO — A federal jury has convicted the head of a Schaumburg home health company on fraud charges for scheming to bill Medicare for millions of dollars in unnecessary services.
As the manager of Suburban Home Physicians, which did business as Doctor at Home, DIANA JOCELYN GUMILA directed employees to perform in-home visits with patients who were physically capable of leaving their residences and not in need of the in-home treatment. Gumila also inflated the costs incurred by Medicare by directing employees to bill the treatment at the most complicated levels, even though the visits were typically routine and did not qualify for the elevated billing.
After a two-week trial in federal court in Chicago, the jury Friday night convicted Gumila, 46, of Streamwood, on 21 counts of health care fraud and three counts of making false statements in a health care matter. Each count of health care fraud is punishable by up to ten years in prison, while each false-statement count is punishable by up to five years in prison.
U.S. District Judge Charles P. Kocoras scheduled a sentencing hearing for July 26, 2016, at 9:45 a.m.
GUMILA became the latest defendant convicted in the federal investigation of Doctor at Home. The prior convictions include ALAN NEWMAN, a physician from Chicago, and JAMES ADEMIJU, a nurse from Matteson who operated two nursing agencies. In a plea agreement, Newman admitted falsely certifying patients for nursing services even when he knew that the patients did not need such care. Newman admitted causing approximately $2.6 million in losses to Medicare, according to his plea agreement. Ademiju pleaded guilty to making illegal payments for patient referrals, and he acknowledged billing for services that were improperly authorized by physicians from Doctor at Home.
Evidence presented at Gumila’s trial included a surreptitious audio recording in which Gumila can be heard telling a new doctor to “paint the picture” of patients so as to make them appear confined to their homes. Emails from Gumila were also shown to the jury, including one in which she referred to a physician who did not read orders before signing them as “the type of doctor we need [b]ecause he will just do what we tell him to do.”
Gumila’s conviction was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Lamont Pugh III, Special Agent-in-Charge of the Chicago Region of the U.S. Department of Health and Human Services Office of Inspector General; Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation; and Joseph Del Favero, Deputy Assistant Inspector General for Investigations of the Railroad Retirement Board Office of the Inspector General.
The investigation was carried out by the Medicare Fraud Strike Force, which is part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative between the U.S. Justice Department and the U.S. Department of Health and Human Services to prevent fraud and to enforce anti-fraud laws around the country. Dozens of defendants have been charged in numerous fraud cases since the strike force began operating in Chicago in 2011.
The government is represented by Assistant U.S. Attorneys Stephen Chahn Lee and Vikas Didwania.
Fayetteville, N.C. Woman Responsible for Creating Fake Patient Files in Medicaid Fraud Conspiracy Is Sentenced PrisonRead the Press Release
CHARLOTTE, N.C. – Chief U.S. District Judge Frank D. Whitney sentenced to 33 months in prison a Fayetteville, N.C. woman responsible for creating fake patient records in a Medicaid fraud conspiracy, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Tanisha Melvin, 36, was also ordered to serve three years under court supervision and to pay $392,159.81 as restitution to Medicaid.
John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division joins U.S. Attorney Rose in making today’s announcement.
According to information in filed court documents and today’s sentencing hearing, between October 2012 and August 2013, Melvin was involved in a Medicaid fraud conspiracy organized by the ring’s leader, Cynthia Harlan. Harlan owned and operated “Heartland Consulting and Marketing, Inc.,” a Charlotte-area company, purportedly specializing in the operation of mental health companies and Medicaid reimbursement. According to court records, Harlan executed a Medicaid fraud scheme involving the fraudulent submission of fake reimbursement claims to Medicaid for services that were never actually provided to beneficiaries. Court records show that Harlan relied on a network of conspirators, including Melvin, whom she had recruited to carry out the scheme.
According to court records, as part of the healthcare fraud conspiracy, Melvin was responsible for creating fraudulent patient records for companies purported to provide outpatient mental and behavioral health services, including “Kings of Carolina Care 1” (Carolina Care 1) in Rockingham, N.C., and “United Rehabilitation Services” (URS) in Erwin, N.C. At the direction of Harlan, Melvin fabricated and compiled the sham paperwork in patient files to support the false Medicaid reimbursement claims submitted on behalf of the two companies. These patient files included fabricated intake packets, non-existent mental health problems and made-up treatment for the problems. The patient files were intended to deceive Medicaid auditors in case there was an inquiry about the accuracy of the fake claims. According to court records, during the relevant time period the conspirators attempted to obtain from Medicaid over $1.6 million in fraudulent reimbursement claims. Melvin, Harlan and the other conspirators received a portion of the fraud proceeds for their respective roles in the scheme.
Court records show that after Harlan became aware that she was being investigated for Medicaid fraud, Harlan instructed Melvin to destroy records relevant to the scheme. Melvin destroyed documents and, as directed by Harlan, contacted other members of the conspiracy to alert them to the investigation and to instruct them to destroy documents, emails and text messages for the purpose of obstructing the investigation.
Melvin pleaded guilty in December 2015 to one count of health care fraud conspiracy. Today, she was released on bond following her sentencing hearing and will be ordered to report to the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
In announcing today’s sentence Judge Whitney noted that the crime involved “Scarce taxpayer funds that are to be used to assist those that are the most needy.”
In addition to Melvin, three other members of the conspiracy have already been sentenced to prison. The owners of URS, Alexander Bass and Torrey Darnell Moton, were previously sentenced to 32 and 25 months in prison, respectively, three years of supervised release and were ordered to pay $370,372.37 as restitution to Medicaid. LaChanda Clotiel Parks, who was also responsible for generating some of the fake patient paperwork, was sentenced to 28 months in prison, followed by three years of supervised release, and was ordered to pay $352,565.69 in restitution for her role in the conspiracy. The owners of Carolina Care 1, Tyree Craig Jones and Claude Bernard McCray, have been charged with one count of health care fraud conspiracy. Cynthia Harlan is currently in federal custody on health care fraud conspiracy, aggravated identity theft and obstruction charges.
The investigation was handled by the FBI with assistance from the North Carolina Medicaid Investigations Division. Assistant U.S. Attorney Kelli Ferry is in charge of the prosecution.
The investigation is the work of the Western District’s joint Health Care Fraud Task Force. The Task Force is multi-agency team of experienced federal and state investigators, working in conjunction with criminal and civil Assistant United States Attorneys, dedicated to identifying and prosecuting those who defraud the health care system, and reducing the potential for health care fraud in the future. The Task Force focuses on the coordination of cases, information sharing, identification of trends in health care fraud throughout the region, staffing of all whistle blower complaints, and the creation of investigative teams so that individual agencies may focus their unique areas of expertise on investigations. The Task Force builds upon existing partnerships between the agencies and its work reflects a heightened effort to reduce fraud and recover taxpayer dollars.
If you suspect Medicare or Medicaid fraud please report it by phone at 1-800-447-8477 (1-800-HHS-TIPS), or E-Mail at [email protected]. To report Medicaid fraud in North Carolina, call the North Carolina Medicaid Investigations Division at 919-881-2320.
Fargo Man Sentenced for Gate City Bank RobberyRead the Press Release
FARGO -U. S. Attorney Christopher C. Myers announced that on April 18, 2016, Jeremy Craig Fahleen, 35, Fargo, ND, was sentenced before U. S. District Judge Ralph R. Erickson to serve 5 years and 3 months for bank robbery. Judge Erickson also ordered that Fahleen pay restitution in the amount of $3,808, as well as pay a $100 special assessment to the Crime Victims’ Fund.
On or about April 25, 2015, Fahleen entered the Gate City Bank located at 1501 South University Dr. in Fargo and slid a note across the counter that stated, “no alarms, no dye packs, no GPS, cash” and demanded money from the bank teller. The bank employee put cash from two cash drawers on the counter. Fahleen put the cash in a bag and left the bank with $7,286 but was later apprehended in St. Cloud, Minnesota. A search of Fahleen and the vehicle he was driving uncovered cash in the total amount of $3,478.
This case was investigated by the Federal Bureau of Investigation (FBI) and the Fargo Police Department (FGPD).
First Assistant U. S. Attorney Keith Reisenauer prosecuted the case.
Dermatology Physicians and Practice to Pay $1.9 Million to Settle False Claims Act Investigation into Overbilling Medicare for Evaluation and Management ServicesRead the Press Release
ATLANTA—The U.S. Attorney’s Office for the Northern District of Georgia announced that it has reached a settlement with dermatologists Margaret Kopchick, M.D., and Russell Burken, M.D., and their practice group, Toccoa Clinic Medical Associates, who agreed collectively to pay $1.9 million to settle claims that they violated the False Claims Act by billing Medicare for evaluation and management (E&M) services that were not permitted by Medicare rules.
“Physicians and practice groups are expected to bill Medicare for the costs of the services they provide. However, when they improperly bill for those services, it affects those who depend on Medicare by taking available dollars away from the program,” said U.S. Attorney John Horn. “Those who inflate their Medicare billings can expect recovery of any overpayments, as well as significant penalties under the False Claims Act.”
“The improper billing of evaluation and management services cost the taxpayers millions of dollars each year and drain the Medicare Trust Fund,” said Derrick L. Jackson, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG) for the Atlanta region. “The OIG and the U.S. Attorney’s Office will continue to hold health care providers like these responsible for improper claims.”
The civil settlement resolves the United States’ investigation into Drs. Burken and Kopchick’s billing for E&M services on the same day as a procedure. Providers are not permitted to bill both E&M services and a procedure on the same day under the Medicare program’s regulations unless a significant, separately identifiable service has been performed. In addition, where a significant, separately identifiable service has been performed, providers must bill the appropriate level of E&M service. More complex E&M services are reimbursed at higher rates. Here, the United States alleged that Drs. Burken and Kopchick billed for E&M services along with procedures where no significant and separately identifiable service was performed, and upcoded E&M services to higher levels than were appropriate, leading to overpayments by Medicare.
HHS-OIG has identified the inappropriate billing of E&M services as a national issue costing taxpayers billions of dollars.
This resolution is part of the government’s emphasis on combating health care fraud under the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by the Secretary of the Department of Health and Human Services in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act. Since January 2009, the Justice Department recovered more than $27.4 billion through False Claims Act cases, with more than $17.4 billion of that amount recovered in cases involving fraud against federal health care programs.
This case was investigated by the U.S. Attorney’s Office for the Northern District of Georgia and the U.S. Department of Health and Human Services, Office of Inspector General.
Assistant United States Attorney Emily Shingler reached the civil settlement.
The claims settled by the settlement agreement are allegations only; there has been no determination of liability.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Defendant Pleads Guilty to Cultivating Marijuana in Sequoia National ForestRead the Press Release
FRESNO, Calif. —Macedonio Madrigal-Herrera (Madrigal), 44, of Michoacán, Mexico, pleaded guilty today to conspiring to manufacture, distribute and possess with intent to distribute marijuana, in connection with a large-scale cultivation operation located in the Brush Creek drainage in the Sequoia National Forest in Tulare County, United States Attorney Benjamin B. Wagner announced.
According to court documents, Madrigal was responsible for watering 2,719 marijuana plants in the National Forest. The marijuana cultivation activities caused extensive damage to the public land and natural resources. Zinc phosphide, a toxic pesticide from Mexico, was found at the site, along with fertilizer and trash. Trees and plants, newly generated following the 2002 McNally Fire, were cut down to make room for the marijuana. Water was diverted from a nearby stream that supports trout. As part of the plea agreement, Madrigal will pay $4,190 in restitution to the U.S. Forest Service for the damage caused by his wrongful conduct.
Madrigal is scheduled for sentencing on July 18, 2016. He faces a maximum statutory penalty of 20 years in prison and a $1 million fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
This case is the product of an investigation by the U.S. Forest Service, the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the California National Guard, the California Department of Fish and Wildlife, and Tulare County Sheriff’s Office. Assistant United States Attorney Karen Escobar is prosecuting the case.
Couple Admits to Producing Sexually Explicit Pictures of a ChildRead the Press Release
Greenbelt, Maryland – Jesus Coca, age 35, and his wife Caroline Coca, age 36, both of Hawthorne, California, pleaded guilty today to producing child pornography.
The guilty pleas were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Andre R. Watson of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Special Agent in Charge Claude Arnold of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Hawthorne (California) Police Chief Robert Fager; Los Angeles County Sheriff Jim McDonnell; Los Angeles County District Attorney Jackie Lacey; and St. Mary’s County Sheriff Tim Cameron.
According to their plea agreements, on December 3, 2014, a 14 year old child reported to a school counselor in Hawthorne, California that Jesus Coca was sexually abusing the child.
More than once from the summer 2012 to early 2013, Jesus directed Caroline to perform sexual acts on the victim while Jesus watched a live transmission on his cell phone over FaceTime. Jesus also had FaceTime chats with the victim in which he directed the victim to engage in sexually explicit conduct. Jesus screen captured numerous images of the live transmissions of the victim engaged in such conduct, and on numerous occasions sent the screen captures by text message to Caroline.
Caroline provided the victim access to her cell phone and encouraged the victim to engage in these FaceTime sessions with Jesus.
On December 3, 2014, Hawthorne, California police officers executed a search warrant at a residence located in Hawthorne, California, and seized computer hard drives containing cell phone backups for cell phones belonging to Jesus and Caroline. These backups contained numerous text messages between them regarding the sexual abuse and exploitation of the victim.
As part of their plea agreements, Jesus and Caroline Coca must register as a sex offender in the place where they reside, where they are an employee, and where they are a student, under the Sex Offender Registration and Notification Act (SORNA).
Jesus and Caroline Coca and the government have agreed that if the Court accepts their plea agreements, Jesus will be sentenced to 20 years in prison, and Caroline will be sentenced to 10 years in prison, followed by a lifetime of supervised release for both defendants. U.S. District Judge Paul W. Grimm has scheduled sentencing for Jesus Coca on July 7, 2016 at 1:30 p.m., and sentencing for Caroline Coca on July 8, 2016 at 2:30 p.m. Both defendants are detained.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc. For more information about internet safety education, please visit www.justice.gov/psc and click on the "resources" tab on the left of the page.
United States Attorney Rod J. Rosenstein commended HSI Baltimore and HSI Los Angeles, Hawthorne Police Department, Los Angeles County Sheriff’s Department, Los Angeles County District Attorney’s Office and St. Mary’s County Sheriff’s Office for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Kristi O’Malley, who is prosecuting the case.
Convicted Felon Sentenced to 86 Months for Firearm PossessionRead the Press Release
BOISE – Alex Jones Bailey, 26, of Caldwell, Idaho, was sentenced today to 86 months in prison for unlawful possession of a firearm, U.S. Attorney Wendy J. Olson announced. Chief U.S. District Judge B. Lynn Winmill also ordered Bailey to serve three years of supervised release following his release from prison, and forfeiture of the gun he illegally possessed. Bailey pleaded guilty on June 12, 2016.
According to information presented in court, on March 24, 2015, Bailey was observed by an officer acting suspiciously in a parking lot. The officer confirmed that Bailey had an outstanding arrest warrant, had recently been involved in several pursuits with law enforcement, and had safety alerts indicating he could be armed. Additional officers arrived on scene and attempted to contact Bailey. Bailey ran from officers dropping his backpack and a loaded firearm in the process. He continued to run across the interstate from officers and ultimately caused a vehicle crash. Bailey was arrested by officers and searched, where officers found more than $300, and what appeared to be a drug ledger. Officers searched Bailey’s backpack and found a safe that contained methamphetamine, a digital scale, and a red bandana. Bailey is known to be a Northside gang member.
The case was investigated by the Treasure Valley Metro Violent Crimes Task Force, ATF, and the Nampa Police Department. The Metro Task Force is comprised of federal, state and local agencies, including the Federal Bureau of Investigation; Bureau of Alcohol, Tobacco, Firearms and Explosives; Boise Police Department; Ada County Sheriff’s Office; Caldwell Police Department; Nampa Police Department; Meridian Police Department; Canyon County Sheriff’s Office; and the Idaho Department of Correction.
The case was prosecuted by the Special Assistant U.S. Attorney hired by the Treasure Valley Partnership and the State of Idaho to address gang crimes. The Treasure Valley Partnership is comprised of a group of elected officials in southwest Idaho dedicated to regional coordination, cooperation, and collaboration on creating coherent regional growth. For more information, visit treasurevalleypartners.org.
Community Hosts U.S. Attorney Ortiz and Convenes Civil Rights Panel to Combat Backlash Against Muslim, Arab, Sikh and South Asian AmericansRead the Press Release
BOSTON – Leaders from Muslim and other communities invited United States Attorney Carmen M. Ortiz to lead a civil rights dialogue Friday evening at a mosque in Wayland. Community members and local, state and federal government officials gathered to address discrimination and affirm the Justice Department’s commitment to protecting civil rights.
“In recent weeks, the values of our democratic society have been compromised as Muslim, Arab, Sikh and South Asian Americans, and those perceived to be, have suffered from harassment and violence,” said U.S. Attorney Ortiz. “For many years, the U.S. Attorney’s Office, has engaged in open and honest dialogue with leaders and members of Massachusetts’ diverse communities, and we value each other’s role in making sure that the Commonwealth is a safe and accepting home for people of all faiths.”
During the last several months, individuals who are, or who are perceived to be, Muslim, Arab, Sikh and South Asian have been targeted for discrimination, harassment and violence around the country. Yesterday’s civil rights program provided an opportunity for members of the Muslim community and law enforcement in Massachusetts to support each other during this time of increasing apprehension, to share concerns related to this climate, and to discuss potential resources for those impacted by it. The dialogue was one of 14 events taking place this week in 11 districts across the country, including California, Connecticut, Minnesota and New Jersey. The events are designed to build on the Justice Department’s prosecutorial work in countering anti-Muslim backlash, as well as its outreach efforts, including the new interagency initiative to combat religious discrimination.
Since September 11th, the Department of Justice has investigated over 1,000 incidents involving acts of violence, threats, assaults, vandalisms and arsons targeting Arab, Muslim, Sikh and South Asians, and those perceived to be members of these groups. The Civil Rights Division and U.S Attorneys’ offices have brought prosecutions against more than 60 defendants in such cases, with 57 convictions to date.
For more information, visit the Department of Justice website and follow #standuptobacklash on Twitter for coverage of events across the country.
Colorado-Based Defense Contractor to Pay $450,000 to Resolve False Claims Act Allegations Under Civil Settlement with United StatesRead the Press Release
IONU Security, Inc. (“IONU”) a Defense contractor based in Longmont, Colorado will pay $450,000 under a civil settlement with the United States Department of Justice, announced United States Attorney Richard L. Durbin, Jr. this afternoon. The settlement resolves allegations that the company submitted false claims to the government in violation of the False Claims Act, 31 U.S.C. §§ 3729-3733, as well as certain other claims.
The claims were submitted for services rendered under an Army Contract for Bradley Fighting Vehicles (“Bradleys”). IONU provided Turret Control Drive Units (“TDCUs”) for the Bradleys under subcontracts with the Prime Contractor. The TDCU is a control box that provides power to control the turret, including weapons systems, of a Bradley.
The United States contends that, from April 2013 through mid-September 2013, IONU’s subcontractor manufactured the TDCUs with phenolic insulating washers that did not meet the requirements of the contract. The subcontractor discovered the issue when the washers began cracking and breaking during testing in August and September, 2013. IONU was informed of the issue, and the manufacturing was halted until new washers were procured that met the contract specifications. However, IONU and the subcontractor determined that the non-compliant washers belonged to three lots, and had been used in TDCUs manufactured beginning in April 2013. Despite knowing that over 100 TDCUs manufactured and shipped between April 1 and September 19, 2013 contained washers not manufactured to the contract specification, and despite knowing that a failure of a washer could result in an electronic short and catastrophic failure of the TDCU, IONU did not notify the Prime Contractor or the United States of the defective parts.
The investigation arose after a whistleblower notified the Department of Defense through its fraud hotline. After the Army was notified, it required the retrofit of the TDCUs. The retrofit revealed that 96% of the washers removed from the affected TDCUs in the field were cracked or broken, putting the units at risk of failure.
"When defense contractors supply our armed forces with equipment and/or supplies, those contractors are required to meet certain required specifications," said Special Agent in Charge Janice M. Flores, of the
Defense Criminal Investigative Service (DCIS) Southwest Field Office. "This settlement highlights the Federal Government's continuing resolve to ensure those who defraud the Department of Defense, especially those that put the safety of our men and women serving in the military at risk or unable to accomplish their mission, are held accountable for their actions."
To report fraud, waste, and abuse regarding programs under the purview of the U.S. Department of Defense go to http://www.dodig.mil/hotline/ or call 800-424-9098.
Under the settlement announced today, IONU will pay $450,000 to resolve the company’s potential False Claims Act and certain other liability. Assistant United States Attorney Susan Strawn handled this matter for the United States Attorney’s Office, Western District of Texas.
Charleston felon pleads guilty to Federal gun crimeRead the Press Release
CHARLESTON, W.Va. – A Charleston man pleaded guilty today to a federal gun crime, announced Acting United States Attorney Carol Casto. Fitzgerald Ingram, 24, entered his guilty plea to illegally possessing a firearm after being convicted of a felony.
Ingram admitted that on July 29, 2015, he was apprehended by law enforcement after firing a rifle into a dumpster in the 6th Avenue area of Charleston. Ingram is prohibited from possessing any firearm under federal law because of several previous felony convictions in North Carolina Circuit Court, including taking indecent liberties with a child, failure to register as a sex offender, and assault with a deadly weapon causing serious injury.
Ingram faces up to ten years in federal prison when he is sentenced on July 25, 2016.
The investigation was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Charleston Police Department. Assistant United States Attorney Haley Bunn is in charge of the prosecution. The plea hearing was held before United States District Judge Thomas E. Johnston.
This case was brought as part of Project Safe Neighborhoods. Project Safe Neighborhoods is a nationwide commitment to reduce gun crime in the United States by networking existing local programs targeting gun crime.
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California Woman Pleads Guilty to Federal Cocaine Trafficking Charge in New MexicoRead the Press Release
ALBUQUERQUE – Neisha Necel Williams, 35, of Los Angeles, Calif., pleaded guilty today in federal court in Albuquerque, N.M., to a cocaine trafficking charge under a plea agreement with the U.S. Attorney’s Office.
Williams was arrested in May 2015, on a criminal complaint charging her with a cocaine trafficking offense after the DEA seized .70 kilograms (1.54 pounds) of cocaine from her during an interdiction investigation at the Greyhound Bus Station in Albuquerque on May 18, 2015. The cocaine was concealed in a bundle underneath Williams’ clothes. Williams was indicted on June 9, 2015, and charged with possession of cocaine with intent to distribute.
During today’s proceedings, Williams pled guilty to a felony information charging her with possession of cocaine with intent to distribute. In entering the guilty plea, Williams admitted that on May 18, 2015, while traveling through Albuquerque on a Greyhound bus, she possessed .70 kilograms of cocaine, which was wrapped in a bundle and concealed underneath her clothes. Williams further admitted that she was to be paid for transporting the cocaine from Los Angeles to Macon, Ga.
At sentencing, Williams faces a maximum penalty of 20 years in federal prison. Williams remains in custody pending a sentencing hearing which has yet to be scheduled.
This case was investigated by the Albuquerque office of the DEA and is being prosecuted by Assistant U.S. Attorney Kimberly A. Brawley.
California Company Settles Allegations It Underpaid Import FeesRead the Press Release
A California-based corporation that imports sportswear for sale to various wholesale customers will pay $1.5 million to resolve allegations under the False Claims Act that it underpaid the import duties on shipments from 2010 to 2014, announced U.S. Attorney Annette L. Hayes. Winds Enterprises, Inc. is the California division of Winds Enterprises, Ltd., a Hong Kong corporation whose business is the manufacturing of sportswear, which is imported into the United States and sold to various clothing lines.
“The undervaluing of imports not only defrauds our customs program, it skews the playing field for competitors,” said U.S. Attorney Annette L. Hayes. “These types of qui tam lawsuits are an important tool for keeping the marketplace honest.”
The case was originally filed under seal as a qui tam, or whistleblower, case in 2013, with a former employee alleging that the company was undervaluing shipments to the United States and therefore paying lower duties on the shipments than authorized pursuant to applicable laws and regulations. As is permitted by the qui tam statutes, the former employee or relator, will receive a portion of the settlement funds. In this case the relator will receive 20 percent of the settlement or $300,000.
“Trade enforcement is a priority for U.S. Customs and Border Protection due to the significant role that it plays in the economic security of the United States,” said Richard DiNucci, Executive Director, Cargo and Conveyance Security, Office of Field Operations. “CBP is responsible for facilitating the legitimate flow of trade, while enforcing the laws against the evasion of duties that protect against unfair trade practices.”
Winds Enterprises, Inc. admits no wrongdoing in the case.
The matter was investigated by U.S. Customs and Border Protection (CBP).
The settlement was negotiated by Assistant United States Attorneys Kayla Stahman and David East.
Press contact for the U.S. Attorney’s Office is Public Affairs Officer Emily Langlie at (206) 553-4110 or [email protected].
Brooklyn Man Arrested for Bribery in Connection with NYPD - Issued Gun LicensesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Diego Rodriguez, Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), and William J. Bratton, Commissioner of the New York City Police Department (“NYPD”), announced today that ALEX LICHTENSTEIN, a/k/a “Shaya,” was arrested and charged in Manhattan federal court with bribery and conspiracy to commit bribery in connection with his efforts to pay bribes to obtain gun licenses through the NYPD’s License Division. LICHTENSTEIN was arrested by FBI agents and officers from the NYPD’s Internal Affairs Bureau (“IAB”) on April 17, 2016, in Pomona, New York, and will be presented before U.S. Magistrate Judge Henry B. Pitman in Manhattan this afternoon.
Manhattan U.S. Attorney Preet Bharara said: “As alleged, Alex Lichtenstein sought to bribe police officers with thousands of dollars to obtain gun licenses. Just a few days ago, claiming that his prior connections in the License Department were no longer able to help, Lichtenstein allegedly attempted to bribe another officer. As alleged, Lichtenstein offered the officer $6,000 per license, bragging that he had already used his NYPD connections to obtain 150 gun licenses. Corruption in any part of government cuts at the very fabric of our society. But it is particularly damaging when it undermines public safety. I thank the FBI and the New York City Police Department, particularly its Internal Affairs Bureau, for their dedication and commitment to this ongoing and important investigation.”
FBI Assistant Director-in-Charge Diego Rodriquez said, “The requirements for obtaining a legal gun license are there for very specific reasons, and the details of this case illustrate why those regulations are needed. This bribery scheme allowed a man to obtain a gun who made a threat against someone’s life. It’s further alarming that Lichtenstein bragged about beating the system and potentially put the general public in danger.”
NYPD Commissioner William J. Bratton said: “This case was developed as part of a long-term joint investigation by the NYPD’s Internal Affairs Bureau, the Federal Bureau of Investigation, and the United States Attorney’s Office. As we have previously stated, this investigation will continue to go where the leads take us.”
According to the allegations in the Complaint filed today in Manhattan federal
court[1]:
LICHTENSTEIN is a member of the Borough Park Shomrim, a volunteer, ostensibly unarmed Orthodox Jewish patrol society whose mission includes combating criminal activity and locating missing people. In April 2016, LICHTENSTEIN approached an officer for the NYPD and offered the officer cash bribes in order for the officer to help LICHTENSTEIN obtain gun licenses for LICHTENSTEIN’s customers from the NYPD’s License Division. The License Division is responsible for reviewing, investigating, and approving or disapproving all applications for gun licenses in New York City. LICHTENSTEIN told the officer that he charged customers thousands of dollars to help obtain License Division approval for their gun license applications, and that he was able to get the licenses approved using his own connections in the License Division, although those connections had recently cut him out.
The officer did not agree to assist LICHTENSTEIN, and reported the encounter to IAB. Working with the FBI and IAB, the officer set up and recorded a meeting with LICHTENSTEIN, at which LICHTENSTEIN offered the officer $6,000 per license application that the officer could help get through the License Division. In that recorded meeting, LICHTENSTEIN told the officer that he had obtained gun licenses for approximately 150 individuals in the past, and that his customers needed his services because the License Division would otherwise reject applications “for the biggest stupidity,” such as a history of moving violations. LICHTENSTEIN boasted that he was able to use his connections in the License Division to “expedite” the application process, i.e., to forego the full investigation typically conducted before the NYPD License Division approves or disapproves an application. The officer asked LICHTENSTEIN if his previous connections in the License Division were making money, to which LICHTENSTEIN responded “now they cut down, now nobody’s making money.”
In fact, LICHTENSTEIN had substantial connections to a sergeant (“Sergeant-1”) who had worked at the License Division for more than a decade. A Commanding Officer at the NYPD with whom Sergeant-1 was friendly introduced LICHTENSTEIN to the License Division and Sergeant-1 in or about 2013. From that introduction through early 2016, LICHTENSTEIN spent significant time at the License Division with Sergeant-1, often on a near daily basis. Sergeant-1 frequently bragged about his relationship with the Commanding Officer and the Hasidic Jewish community. In early 2016, Sergeant-1 told others at the NYPD License Division, in sum and in substance, that LICHTENSTEIN charged his customers $18,000 per gun license, and that, at some point in time, the deputy inspector in charge of the License Division had sat Sergeant-1 and LICHTENSTEIN down and banished LICHTENSTEIN from the License Division because of the money that LICHTENSTEIN was making selling gun licenses. An officer who processed applications for Sergeant-1 was interviewed and acknowledged his and Sergeant-1’s relationship with LICHTENSTEIN. When asked if LICHTENSTEIN gave them cash, the officer paused before saying that LICHTENSTEIN provided them “lunch money,” and when asked how much “lunch money,” the officer responded, “$100.”
The NYPD License Division receives approximately 5,000 applications for gun licenses a year. Most licenses approved by the NYPD License Division are for individuals to keep in their homes or businesses, but a small portion of the approved licenses are for individuals to carry guns for limited work reasons or to carry guns at all times based on a substantial showing of employment-based need. After receiving an application the NYPD License Division conducts an investigation of the applicant before electing to approve or disapprove the application. The investigation includes (i) a review of the applicant’s criminal history, including summonses, arrests, and convictions; (ii) a review of the applicant’s mental health history; (iii) a verification of the details of the application; (iv) an in-person interview of the applicant; and (v) an investigation into the business need for a license to carry a gun.
Certain findings, such as a prior felony conviction, result in the automatic disapproval of an applicant. Pursuant to New York State Law, the NYPD License Division has discretion to reject gun license applications for additional reasons, such as moral character, mental health issues, or substance abuse issues. On its website, the NYPD License Division indicates that it may reject applications if the investigation reveals a history of arrest, driving infractions, or domestic violence incidents, among other reasons. Typically, the processing, investigation, and approval or disapproval of an application takes several months and, for licenses to carry guns, at times in excess of one year.
Yesterday, detectives from IAB seized applicant files from the NYPD License Division associated with LICHTENSTEIN and/or Sergeant-1. A review of those files has begun and is ongoing. One such file appears to have been for an individual (“License Holder-1”) who, in 2013, was approved for and obtained a license to carry a firearm at all times. Prior to his application for a gun license, License Holder-1 had been arrested for forgery, received approximately 10 moving violations and three vehicle-related summonses, and had been the subject of at least four domestic violence complaints, including one in which he was accused of threatening to kill someone.
LICHTENSTEIN, 44, who now resides in Pomona, New York, has been charged with one count of bribery, which carries a maximum term of 10 years in prison, and one count of conspiracy, which carries a maximum term of five years in prison. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Bharara praised the investigative work of the FBI and the NYPD Internal Affairs Bureau, and noted that the investigation is continuing.
This case is being handled by the Office’s Public Corruption Unit. Assistant United States Attorneys Kan M. Nawaday, Russell Capone, and Martin S. Bell are in charge of the prosecution.
The charges contained in the Complaint are merely accusations and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.
Bon Secours Health System and Doctor Settle False Claims Act AllegationsRead the Press Release
RICHMOND, Va. –Bon Secours Health System, Inc., located in Marriottsville, Maryland, and one of its surgical oncologists, Dr. Eugene Y. Chang, M.D., of Suffolk, have agreed to pay $400,000 to settle civil fraud allegations that while at Bon Secours Maryview Medical Center in Portsmouth, Dr. Chang billed Medicare and other federal healthcare payors for non-covered breast examinations and ultrasounds.
The settlement resolves allegations that from June 1, 2010, through Dec. 31, 2014, Dr. Chang falsified documents with diagnosis codes, such as "lump or mass in breast," where none existed. Chang allegedly did this in order to induce federal healthcare payors such as Medicare to pay for non-covered “screening” breast examinations in connection with routine screening mammograms as if they had been reimbursable “diagnostic” breast examinations. Chang would assign a code that requires a chief complaint from the patient, indicating to Medicare and other payors that the examination was “diagnostic,” while patient charts maintained by Dr. Chang indicated that the patient had no complaint. Additional allegations resolved by the settlement include arranging for certain patients to receive screening breast examinations and screening breast ultrasounds at approximately six-month intervals following screening mammograms, and improperly billing these services as “diagnostic,” which resulted in federal healthcare programs paying for non-covered screening examinations and ultrasounds.
The settlement resolves allegations in a lawsuit filed in the U.S. District Court for the Eastern District of Virginia by a former Bon Secours practice manager and a former colleague of Dr. Chang under the qui tam, or whistleblower provisions of the False Claims Act. Under the False Claims Act, private citizens, also known as relators, can bring suit on behalf of the United States and share in any recovery. The relator share in this settlement is $108,000.
The relators alleged that Bon Secours’ management had specific knowledge of Dr. Chang’s activities after the relators alerted Bon Secours to the problem in August 2011.
The resolutions obtained in this matter were the result of a coordinated effort between the U.S. Attorney's Office for the Eastern District of Virginia, the Department of Health and Human Services, the Office of Inspector General, the Defense Criminal Investigative Service, and the U.S. Office of Personnel Management, Office of the Inspector General.
The matter was investigated by Assistant U.S. Attorney Robert McIntosh. The civil claims settled by this False Claims Act agreement are allegations only; there has been no determination of civil liability.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia.
Blood Lab Owner Sentenced to Nine Months in Prison for Paying Thousands in Cash Bribes for ReferralsRead the Press Release
NEWARK, N.J. – An owner of a blood diagnostic company located in Essex County, New Jersey, was sentenced today to nine months in prison for paying a doctor cash bribes for patient lab work referrals, U.S. Attorney Paul J. Fishman announced.
Phillip Biondello, 49, of Basking Ridge, New Jersey, previously pleaded guilty before U.S. District Judge Madeline Cox Arleo to an information charging him with violating the Anti-Kickback Statute. Judge Arleo imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
From June 2011 through June 2013, Biondello paid a doctor cash bribes in return for patient blood sample referrals to Biondello’s company, including a $24,000 bribe paid to the doctor on May 7, 2013. The doctor’s referrals generated approximately $176,710.84 for Biondello’s company.
In addition to the prison term, Judge Arleo sentenced Biondello to three years of supervised release.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special
Agent in Charge Timothy Gallagher in Newark, and special agents of the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Joseph N. Minish of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark.
U.S. Attorney Fishman reorganized the health care fraud practice shortly after taking office, 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: Joseph A. Hayden Jr. and Kevin Buchan Esq., Roseland, New Jersey.
Bankruptcy attorney sentenced to 34 months in prison for bankruptcy fraudRead the Press Release
MONROE, La. – United States Attorney Stephanie A. Finley announced today that a bankruptcy attorney was sentenced to 34 months in prison for collecting filing fees from clients without informing the bankruptcy court.
Glay H. Collier II, 53, of Benton, La., was sentenced by U.S. District Judge Robert G. James on one count of bankruptcy fraud. He was also sentenced to three years of supervised release and ordered to pay $69,063.05 restitution. According to evidence presented at the November 10, 2015 guilty plea, Collier filed records into the bankruptcy court stating that he would accept “No Look” fees as payment for his services. The “No Look” fee caps attorney’s fees in bankruptcy proceedings to $2,800. In excess of that limit, Collier charged up to $281 in filing fees to some clients, which he did not disclose to the court. Between March 2010 and November 2013, Collier filed 983 Chapter 13 bankruptcy cases in Monroe, and during the same time period, he filed 2,160 Chapter 13 bankruptcy cases in Shreveport. In approximately 479 of these cases, Collier fraudulently collected and attempted to collect filing fees.
The FBI and the U.S. Trustee’s Office, Region 5, conducted the investigation. Assistant U.S. Attorney Cytheria D. Jernigan prosecuted the case.
Bank Robber Sentenced in Federal CourtRead the Press Release
United States Attorney Kenyen R. Brown of the Southern District of Alabama announced that Brent H. Cox, 58, of Semmes, was sentenced today in federal court for robbing the Iberia Bank on the west I-65 Service Road in Mobile in August of 2015. Cox pled guilty to the bank robbery charge in December of 2015.
United States District Court Judge Charles R. Butler, Jr., imposed a sentence of 109 months imprisonment, and ordered a three-year term of supervised release to follow his release from custody. No fine was imposed but Cox was ordered to pay $100 in special mandatory assessments and restitution to the bank.
The investigation was conducted by the Mobile Police Department and the Federal Bureau of Investigation. It was prosecuted in the United States Attorney’s Office by Assistant United States Attorneys Gina Vann and Gloria Bedwell.
Bakersfield Man Sentenced to over 4 Years in Prison for Possession of Child PornographyRead the Press Release
FRESNO, Calif. — Timothy Brian Grayson, 58, of Bakersfield, was sentenced today by United States District Judge Lawrence J. O'Neill to four years and 9 months in prison for possessing child pornography, United States Attorney Benjamin B. Wagner announced.
According to court documents, between September and October 2013, Grayson possessed on a laptop computer and hard drive at least 300 image files with visual depictions of minors engaging in sexually explicit conduct.
This case was the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). Assistant United States Attorney Grant B. Rabenn and Special Assistant U.S. Attorney Katherine A. Plante prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about Internet safety education.
Bakersfield Man Sentenced for Striking Sheriff’s Helicopter with LaserRead the Press Release
FRESNO, Calif. —Pablo Cesar Sahagun, 26, a citizen of Mexico and resident of Bakersfield, was sentenced to 18 months in prison for aiming the beam of a laser pointer at a Kern County Sheriff’s helicopter, United States Attorney Benjamin B. Wagner announced.
On January 11, 2016, Sahagun pleaded guilty to aiming a beam of a laser pointer at an aircraft. According to court documents, he repeatedly struck and tracked a Kern County Sheriff’s helicopter, Air-1, with the beam of a green laser pointer. The laser pointer was key-activated and labeled as a Laser 301, a device that purports to emit a one-watt laser beam, which is 2,000 times more powerful than what is legally permissible for a laser pointer. The laser strikes caused the airmen to experience flash blindness, glare, blurry vision, eye discomfort, headache and irritation.
In sentencing Sahagun, United States District Judge Dale A. Drozd stated: “This is an egregious case of a laser strike. … The circumstances are inexplicable.”
Reports of laser attacks on aircraft have increased dramatically in recent years as powerful laser devices have become more affordable and widely available to the public. From 2011 to 2015, there have been over 23,000 laser illumination incidents in the United States reported to the Federal Aviation Administration (FAA). This year there have been over 22 laser strikes reported in the United States every day. In the Eastern District of California, which encompasses 34 counties in the eastern portion of California, there were 214 reported laser incidents in 2015. Lasers can completely incapacitate pilots who are trying to fly safely to their destination, endangering their crew members, passengers and people on the ground.
This case was the product of an investigation by the Federal Bureau of Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Kern County Sheriff’s Office, and the Bakersfield Police Department. Assistant U.S. Attorney Karen A. Escobar prosecuted the case.
Attorney, Broker and Two Realtors Indicted on Mortgage Fraud ChargesRead 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 a federal grand jury has returned a 24 count indictment charging Gregory Gibbons, 50, of Thornwood, NY; Julio Rodriguez, 51, of Bronx, NY; Laurence Savedoff, 42, of New City, NY, and Tina Brown, 40, of Bronx, New York with conspiracy to commit wire and mail fraud affecting financial institutions, wire and mail fraud affecting financial institutions, and bank fraud. The charges carry a maximum penalty of 30 years in prison and a $1,000,000 fine.
“Persons who engage in mortgage fraud undermine the American dream of home ownership,” said U.S Attorney Hochul. “Such actions - if successful - hurt potential homeowners, banks and government programs designed to assist homebuyers.
"In the last number of years, we have seen enormous and damaging developments in the mortgage and housing markets, said U.S. Housing and Urban Development, Office of Inspector General, Special Agent in Charge Brad Geary. “Indictments, such as this, set an important precedent that this type of behavior will not be tolerated and will be aggressively pursued. We are deeply committed to working in partnership with our federal law enforcement counterparts to ensure that corrupt individuals do not use their positions to enrich themselves at the expense of the government.”
Assistant U.S. Attorneys Kathleen A. Lynch and Elizabeth R. Moellering, who are handling the case, stated that according to the indictment, the defendants engaged in scheme to obtain mortgages on behalf of borrowers who would not have otherwise qualified for those loans if their true income, asset and employment information was submitted to the lender for approval and for FHA insurance.
Specifically, to secure a loan, the defendants would submit among other things, employment documents that falsified the purchaser’s income, assets, and place of employment. In addition, the defendants submitted false settlement statements to the banks indicating where the proceeds of the loan were disbursed.As a result, based on the fraudulent information and certifications submitted, loans amounting to more than $4,100,000 were approved for the borrowers. Subsequently, the borrowers defaulted on the loans and the properties are now in various stages of foreclosure.
Defendants Laurence Savedoff, Julio Rodriguez and Tina Brown, were arraigned this afternoon before U.S. Magistrate Judge H. Kenneth Schroeder, Jr. and were released with conditions.
The indictment is the culmination of an investigation by the United States Postal Inspection Service under the direction of Shelly Binkowski, Inspector in Charge, Boston Division, the United States Department of Housing and Urban Development, Office of the Inspector General, under the direction of Special Agent in Charge Brad Geary; and the Federal Bureau of Investigation, under the direction of Special Agent in Charge Adam S. Cohen. Additionally, the New York State Department of Financial Services assisted with the investigation.
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.
Armed Carjacker Sentenced to 30 Years in Federal PrisonRead the Press Release
DALLAS — Felipe Pinon, 28, of Dallas, was sentenced this morning by U.S. District Judge Sam A. Lindsay to 30 years in federal prison, following his guilty plea in November 2015 to felony offenses stemming from his role in the armed carjacking of two people last year in Dallas, announced U.S. Attorney John Parker of the Northern District of Texas.
Pinon pleaded guilty to one count of carjacking and aiding and abetting and one count of using, carrying, and brandishing a firearm in furtherance of a crime of violence and aiding and abetting.
Pinon’s co-defendant in the case, Monica Renee Metcalf, 22, also of Dallas, pleaded guilty in November 2015 to the same offenses. She faces a statutory penalty of up to 15 years in federal prison and a $250,000 fine on the carjacking count and up to life in federal prison on the firearm count. She is scheduled to be sentenced by Judge Lindsay on July 25, 2016.
According to documents filed in the case, on January 18, 2015, Metcalf approached an individual (Victim 1) at a gas station near the 3300 block of Webb Chapel Extension in Dallas and asked Victim 1 for a ride. Metcalf directed Victim 1 to drive her to an apartment complex across the street, and when they arrived there, Pinon approached the vehicle and spoke with Metcalf. Metcalf then asked Victim 1 to give Pinon a ride as well, but Victim 1 refused. Pinon then brandished a handgun and pointed it at Victim 1 and demanded that Victim 1 give him everything he had. Pinon and Metcalf ordered Victim 1 out of the vehicle and drove away in it.
The next day, Metcalf approached and briefly spoke with an individual (Victim 2) who was seated in his vehicle near the 300 block of S. Seagoville Road in Dallas. As Metcalf walked away from Victim 2, Pinon approached Victim 2. Pinon brandished a handgun and ordered Victim 2 to get out of the vehicle. Then, Pinon, Metcalf, and another individual drove away in Victim 2’s vehicle.
The Dallas Police Department and the Federal Bureau of Investigation conducted the investigation. Assistant U.S. Attorney Brian Poe and Deputy Criminal Chief Assistant U.S. Attorney Gary Tromblay are prosecuting the case.
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Anchorage Man sentenced to 84 months in prison for role in large-scale money laundering conspiracyRead the Press Release
Anchorage, Alaska-U.S. Attorney Karen L. Loeffler announced today that an Anchorage man has been sentenced by Chief U.S. District Judge Timothy M. Burgess to serve 84 months in prison for his role in a conspiracy to launder hundreds of thousands of dollars earned from the sale of large quantities of heroin and cocaine by local drug dealers.
David Edward Frazier, of Anchorage, previously pled guilty to conspiring with others launder the proceeds of drug trafficking. As part of his guilty plea, Frazier admitted that he sold nearly three kilograms of heroin and ten kilograms of cocaine and then delivered the cash from those sales back to his supplier in order to continue their drug trafficking operation.
Following his release from prison, Frazier will be on supervised for three years. As part of the sentence, Judge Burgess entered a money judgment against Frazier for $743,000 – the total amount of drug money laundered during the conspiracy.
According to Assistant U.S. Attorney Stephanie C. Courter, who prosecuted the case, the conspiracy began in March 2013 and continued until June 2013. During that time, Frazier acquired drugs, mainly heroin and cocaine, from a local drug supplier and then worked with a partner to sell the drugs to others. Frazier was “fronted” the drugs by his source, meaning that he obtained the drugs essentially “on credit.” He then sold the drugs and returned the cash proceeds to his supplier in order to continue their drug enterprise. Over the course of just three months in 2013, Frazier and his partner acquired nearly three kilograms of heroin and more than ten kilograms of cocaine from their supplier. The wholesale value of the drugs sold exceeded $660,000, with the conspirators earning an additional $80,000 in profit.
During the sentencing hearing, Judge Burgess called Frazier’s actions extremely serious, noting that Frazier sold nearly $250,000 worth of heroin and cocaine each month for three months. Judge Burgess also found Frazier’s criminal history to be significant, pointing out that Frazier’s record included at least 15 adult criminal convictions.
The sentencing hearing is related to a string of indictments returned in late 2014 and early 2015 as part of ongoing efforts to dismantle and prosecute several large scale drug trafficking rings with ties to Alaska, California, Texas, Arizona, and Mexico. To date, the following individuals have been sentenced as part of these efforts:
- Timothy Alex, an Anchorage drug distributor, previously sentenced to 108 months in prison;
- Daniel Harris, an Anchorage drug distributor, previously sentenced to 135 months in prison;
- Jose Ramon Canales, of Texas, previously sentenced to 70 months in prison for laundering drug money out of the United States and into Mexico;
- Omar Alejandro Alfaro, of Texas, previously sentenced to 84 months in prison for drug trafficking;
- Genaro Gutierrez-Reyes, of California, previously sentenced to 18 months in prison for laundering drug money out of the United States and into Mexico;
- Jorge Armando Zaragoza-Soto, of Mexico, previously sentenced to 96 months in prison for drug trafficking;
- Geronimo Arellano Velarde, of California, previously sentenced to 120 months in prison for drug trafficking;
- Jasmin Sanchez, of California, previously sentenced to 60 months in prison for drug trafficking; and
- Tomas Gutierrez Ayala, of California, previously sentenced to 75 months in prison for drug trafficking.
Several other defendants are set to be sentenced in the coming months for their roles in trafficking heroin, cocaine, and methamphetamine to Alaska and then transporting the cash proceeds of their trafficking activities back to Mexico.
This and the related cases were investigated as part of the Organized Crime Drug Enforcement Task Force (OCDETF). In announcing the sentence, U.S. Attorney Loeffler praised the work of the law enforcement agencies involved, including the Drug Enforcement Administration (DEA), the Internal Revenue Service Criminal Investigation (IRS-CI), the Federal Bureau of Investigation (FBI), the U.S. Postal Inspection Service (USPIS), U.S. Immigration and Customs Enforcement (ICE), which oversees Homeland Security Investigations (HSI), the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), the Anchorage Police Department (APD), the Alaska State Troopers (AST), and the Anchorage Airport Police Department. Additional assistance was provided by the U.S. Attorney’s Offices for the Western District of Texas, the Eastern and Central Districts of California, and the District of Arizona, as well as federal agents in all three states.
Acting U.S. Attorney Announces Management TeamRead the Press Release
COLUMBUS, Ohio – Benjamin C. Glassman, Acting United States Attorney for the Southern District of Ohio, today announced the following appointments to his executive and supervisory staff. The appointments were effective last week.
“I am grateful to work with the finest management team any U.S. Attorney’s Office could have,” Glassman said. “They are experienced and dedicated and share a focus in pursuing justice.”
Vipal J. Patel was named First Assistant U.S. Attorney. This position is the number two position in the U.S. Attorney's Office and is responsible for overseeing the day-to-day operations of the office. Patel has been an Assistant U.S. Attorney since 2000, first in the Central District of California in Los Angeles, and since 2005, in the Southern District of Ohio in Dayton. Patel served as the district Criminal Chief in 2010. Prior to that, he served as Deputy Criminal Chief in the Dayton office since 2006. He spent his 2011 on a one-year detail to Afghanistan, where he served as an advisor to the Afghan Ministry of Justice and other governmental and educational institutions, as part of the U.S. Department of Justice’s Rule of Law program. Patel received an undergraduate degree from Kent State University in 1988, and his law degree from George Washington University Law School in 1991. Prior to becoming a federal prosecutor, Patel was a litigation associate and then partner with the law firm of Hancock Rothert & Bunshoft LLP (currently, Duane Morris LLP), in Los Angeles. Patel also serves as an Adjunct Professor at the University of Dayton Law School, where he has taught International Law and teaches courses in Cybercrime and Criminal Procedure-Adjudication. He is a Board Member (Secretary) of the Dayton Chapter of the Federal Bar Association and a former Board Member for the Boonshoft Museum of Discovery in Dayton.
Mark D'Alessandro will continue as Executive Assistant U.S. Attorney and District Civil Chief. The Executive Assistant is primarily responsible for personnel and facilities issues, Department of Justice reporting requirements, special projects, and other responsibilities. D’Alessandro served as the First Assistant U.S. Attorney from 2010 to January 2016. He has been Civil Chief since 2009 and was Deputy Civil Chief - Columbus from 2001-2009. Before that, he served as a criminal Assistant U.S. Attorney for Health Care Fraud from 1997 until 2001, and was the Affirmative Civil Enforcement (ACE) Assistant U.S. Attorney from 1995 until 1997. D'Alessandro is a 1975 graduate of Boston College and a 1979 graduate of the Capital University Law School. He also served as an Assistant Attorney General for the State of Ohio from 1979 until 1995.
D’Alessandro will be assisted in his Civil Chief duties by Matthew Horwitz, who will continue to serve as Deputy Civil Chief. Horwitz was first named to the post in 2014. He has been an Assistant U.S. Attorney in Cincinnati since 2012. Horwitz graduated from the Ohio State University and received his J.D., with honors, from the Ohio State University Moritz College of Law. He previously practiced at Frost Brown Todd in Cincinnati.
Kenneth L. Parker will continue as District Criminal Chief, a post he has held since 2011. Parker began serving as an Assistant U.S. Attorney in the Cincinnati Criminal Division in 1999. He has also served as the District’s OCDETF Chief. He graduated from Tuskegee University in 1994 and earned his law degree from Indiana University in 1997. Parker has served as president of the Cincinnati-Northern Kentucky Chapter of the Federal Bar Association, and of the Black Lawyers Association of Cincinnati.
Parker will be assisted in his Criminal Chief duties by five Deputy Criminal Chiefs. They are:
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Gary L. Spartis, Deputy Criminal Chief - Columbus. Spartis has served as a Deputy Criminal Chief in the Columbus office since 2001. Prior to that, he served as an Assistant U.S. Attorney beginning in 1987. Spartis graduated from Grove City College (PA) in 1976 and the Capital University Law School in 1979. He served as an Assistant Franklin County Prosecutor from 1981 until 1987.
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Brenda S. Shoemaker, Deputy Criminal Chief – Columbus. Shoemaker has served as a Deputy Criminal Chief in the Columbus office since 2009. Shoemaker has served as an Assistant U.S. Attorney, Columbus Criminal Division, since 1997 and as an Assistant U.S. Attorney in the Dayton Criminal Division from 1995 until 1997. She is a 1977 graduate of the University of Cincinnati and earned her law degree in 1988 from Capital University.
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Emily N. Glatfelter, Deputy Criminal Chief – Cincinnati. Glatfelter has served as a Deputy Criminal Chief in the Cincinnati office since 2015. She joined the U.S. Attorney’s Office in Cincinnati in 2012, primarily handling financial crimes matters. She previously served in the Criminal Division of the U.S. Attorney’s Office District of Maryland, beginning in 2006. She earned her bachelor’s degree from Butler University in 1999 and her law degree from the University of Indiana in 2002 before working for Arnold & Porter LLP in Washington D.C. She also clerked for the Hon. David F. Hamilton while he served as U.S. District Judge for the Southern District of Indiana.
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Laura I. Clemmens, Deputy Criminal Chief – Dayton. Clemmens has served as a Deputy Criminal Chief in the Dayton office since 2009. She began her service as an Assistant U.S. Attorney, Dayton Criminal Division, in 2002. She earned degree from The College of Wooster, the University of Southern Californiaer law degree from the University of. Prior to earning her law degree, Clemmens worked as a scientist at the Denver regional office of the U.S. Environmental Protection Agency.
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Mike Hunter, Deputy Criminal Chief – Organized Crime & Drug Enforcement Task Force. Hunter has served as a Deputy Criminal Chief since 2015 and oversees the District’s Organized Crime & Drug Enforcement Task Force (OCDETF). Hunter has been an Assistant U.S. Attorney since 2006, first in the U.S. Attorney’s Offices for District of Columbia and later in the Southern District of Ohio in Columbus. Hunter is a former law clerk for the Hon. John R. Fisher of the District of Columbia Court of Appeals, an eight year veteran of the United States Air Force, a 1998 graduate of the Ohio State University, and a 2003 graduate of the Cleveland-Marshall College of Law.
Douglas Squires will continue as Senior Litigation Counsel. Squires has served as the District’s Senior Litigation Counsel (“SLC”) since 2014. As the SLC, Squires is responsible for legal training and development. For the past 15 years, Squires has been an Assistant U.S. Attorney in Columbus prosecuting white collar crime, corruption and now terrorism offenses. In 2009, he received the U.S. Department of Justice Distinguished Service Award. From 1994 to 2000, Squires was a state prosecutor in California. He is also an Adjunct Professor at the Ohio State University Moritz College of Law where he teaches white collar crime. He has authored several published materials on white-collar crime and fraud, including a chapter entitled "Forensic Accounting" in Scientific Evidence in Civil and Criminal Cases, 6th Ed., 2013, Foundation Press, a legal textbook on scientific and technical evidence. Squires received a B.A. from Miami University, Oxford, Ohio and his law degree from the University of San Francisco School of Law.
Mary Beth Young was appointed as Appellate Chief, with supervisory responsibility for criminal and civil filings in the Court of Appeals and coordination of the District’s appellate practice with other divisions of the Department of Justice. Young became an Assistant United States Attorney in 2012 in Columbus after serving two years as a Special AUSA. Prior to joining the District, Young was in private practice in Columbus and served as a Visiting Assistant Professor at the Moritz College of Law. Young received her B.S. from the University of Kentucky, her M.S. from Georgia Tech, and her J.D. from the University of Chicago. Following law school, Young served as law clerk to Judge David Sentelle of the United States Court of Appeals for the D.C. Circuit, then to Justice Antonin Scalia of the United States Supreme Court.
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22 Named in Federal Cases Alleging Theft of Social Security BenefitsRead the Press Release
LOS ANGELES – Federal authorities have charged a total of 22 defendants with defrauding the Social Security Administration by illegally receiving cash benefits and causing a cumulative loss of $2.6 million. Most of the defendants are charged with taking Social Security benefits for relatives after the family members had died and failing to alert the agency that the actual beneficiary had passed away.
Federal grand juries in Los Angeles returned 21 indictments last week, cases that were announced today after one defendant – an employee of the Social Security Administration – was arrested for allegedly diverting benefits to herself.
Those charged last week include the federal government employee, a Los Angeles County Sheriff’s Deputy and a San Fernando Valley man who is accused of illegally receiving more than $400,000.
“Government programs like Social Security provide important benefits to qualified individuals so they can have economic security,” said United States Attorney Eileen M. Decker. “We cannot tolerate abuse of the system that provides support to millions of honest Americans, many of whom worked their entire lives to receive Social Security benefits. This series of cases illustrates our commitment to root out abuse and fraud involving social security, and to protect the integrity of an important program aimed at helping senior citizens and the most vulnerable in our society.”
All of the defendants are charged with theft of government property, a crime that carries a statutory maximum sentence of five years in federal prison. Some of the defendants are charged with additional offenses, including aggravated identity theft and defrauding the Social Security Administration.
The Social Security Administration employee – Daysi Salazar-Arias, 38, of Thousand Oaks – was arrested this morning by special agents with the Social Security Administration’s Office of the Inspector General. Salazar-Arias is named in an eight-count indictment that alleges she diverted benefits to herself and making it appear that the money was going to legitimate beneficiaries, one of whom was deceased. Salazar-Arias is expected to be arraigned on the indictment this afternoon in United States District Court in downtown Los Angeles.
Vicki Lynn Gregory, a sergeant with the Los Angeles County Sheriff’s Department, is charged with seven felony counts for allegedly taking her mother’s Widow’s Insurance Benefits after she died. According to the indictment, Gregory “intentionally concealed the death of her mother…in order to continue to receive and spend these Widow’s Insurance Benefits.” Gregory allegedly illegally received approximately $30,000.
In the case involving the largest alleged loss, Jose Aguinaco Ugalde, 68, of West Hills, is charged with 16 counts, including aggravated identity theft, an offense that carries a mandatory two-year prison sentence. According to the indictment, Ugalde stole Retirement Insurance Benefits that continued to be sent to his father, even though the man had died. Ugalde also allegedly stole spousal benefits that were intended for his ex-stepmother. The two identity theft charges in the indictment allege that Ugalde illegally used a debit card issued to his late father, as well as the signature of his ex-stepmother, in stealing these Social Security benefits.
“The Social Security Administration’s Office of the Inspector General is committed to pursuing those who violate the public trust,” said Robb Stickley, the Special Agent in Charge of the San Francisco Field Division, which is responsible for Southern California. “We will continue to uphold the integrity of Social Security’s benefit programs, which are a lifeline for so many Americans and their families.”
The other defendants charged in the grand jury indictments announced today are:
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Ricardo Stephens, 58, of Inglewood, who allegedly illegally received nearly $350,000;
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Kathryn Kushner, 64, of Oxnard, who is charged with illegally taking $241,793 from the Social Security Administration;
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Maria Lopez, 59, of Moreno Valley, who illegally received just over $35,000, according to her indictment;
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Elizabeth White, 54, of the Willowbrook District of Los Angeles, who allegedly caused losses of just over $100,000;
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Kim Dennise Scovis, 60, of Thousand Oaks, who is charged in a case alleging $68,048 in losses;
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Mario Panagiotopoulos, 48, of Whelan, who allegedly illegally took $121,000 from the Social Security Administration;
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Sabina Martinez, 69, of Romoland, whose case involves nearly $100,000 in alleged losses;
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Katina Dell Lasater, 72, of Temecula, who is charged in an indictment that alleges she caused $23,636 in losses;
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John Miguel Cervantes, 57, of Oceanside, who allegedly caused losses totaling nearly $250,000;
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Debra Christine Clark, 47, of Escondido, who is charged with illegally receiving just under $113,000;
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Teodora Valdez Uribe, 82, currently residing in Mexico, who illegally took just over $115,000, according to her indictment;
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James Robert Stutte, 40, of Salt Lake City, Utah, who is accused of defrauding the Social Security Administration out of more than $33,000;
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Gwendolyn Marie Clarrett, 61, of Long Beach, who is charged in an indictment that alleges nearly $25,000 in losses;
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Gene Shui Wong, 65, of Yucca Valley, who is charged with stealing $127,361 from the Social Security Administration;
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Judith Catherine Alcala, 66, of Chino Hills, who allegedly caused $161,580 in losses;
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Taralyn Boucher, 60, of La Quinta, whose case alleges a total of $111,813 in losses;
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Janet Dial, 58, of Thermal, who is also charged with bank fraud in a case that accuses her of illegally receiving $137,105; and
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Laura Michelle Dubief, 29 of Los Angeles, and Maria Isabel Bailey, 56, of Gardena, who are together charged in an indictment that alleges they stole $41,670 in Social Security benefits.
With the exception of Salazar-Arias, who was arrested today, and Uribe, who is in Mexico, the defendants charged in this sweep will be receive summons from the court to appear for arraignments in May.
The Social Security Administration’s Office of the Inspector General investigates waste, fraud and abuse in the program. If you suspect that a beneficiary or someone designated to handle their affairs is defrauding the program, you can call the Social Security Fraud Hotline at 1-800-269-0271 (from 7:00 a.m. to 1:00 p.m. Pacific Time) or you can file a report online anytime at: https://www.ssa.gov/fraudreport/oig/public_fraud_reporting/form.htm
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17 April 2016
Navy Vet Sentenced for Theft of Veteran Health Administration BenefitsRead the Press Release
United States Attorney Kenyen R. Brown of the Southern District of Alabama announced that Arthur McCants, III, 68 year old resident of Eight Mile, Alabama, was sentenced today before the Honorable District Court Judge William E. Steele.
McCants, who served in the U.S. Navy as a communications officer from 1972-1977, was convicted of theft of government funds. McCants defrauded the government for a period of four years, specifically from January 3, 2011 to January 9, 2015, during which he used a fictitious address in order to claim additional mileage on his travel voucher claim forms. As a veteran, McCants is entitled to travel benefits during his visits to the Veterans Administration. However, he received an additional $43,580.34 for filing 924 “padded” travel voucher claim forms over the course of his four year scheme. According to McCants, he knew what he was doing was wrong, but he felt that the U.S. Government had wronged him also. McCants was sentenced to time served; thereby, making his time in custody approximately four months. He will also serve a three year term of supervised release. Additionally, he was ordered to make full restitution to the U.S. Department of Veterans Affairs.
Special Agents of the United States Department of Veteran’s Affairs Office of Inspector General investigated the case. This case was prosecuted by Assistant United States Attorneys Suntrease Williams-Maynard and George May.
15 April 2016
Woman Pleads to Transporting Two Illegal AliensRead the Press Release
SYRACUSE, NEW YORK – Ruth Smoke, 29, of the St. Regis Mohawk Reservation, pled guilty today to transporting two illegal aliens for profit, announced United States Attorney Richard S. Hartunian. Sentencing is scheduled for August 24, 2016 in Syracuse, New York
On December 2, 2015 Ruth Smoke was stopped by New York State Police south of Watertown, New York with two passengers in her vehicle. Subsequent investigation by U.S. Border Patrol Agents revealed that the two passengers were illegal aliens from China who were smuggled into the United States from Canada across the St. Lawrence River earlier in the day. The illegal aliens told Border Patrol Agents that they were to pay $400.00 upon arriving in New York City. As part of her plea of guilty today, Ruth Smoke admitted she was transporting the two illegal aliens in return for a fee.
The charge carries with it a maximum sentence of ten (10) years imprisonment, a fine of up to $250,000.00 and a three year term of supervised release. 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 the United States Border Patrol (Wellesley Island Station) and the New York State Police and is being prosecuted by Assistant U.S. Attorney Richard Southwick.