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Wednesday 17 February 2016
Franklinville Man Pleads Guilty to Illegally Buying and Selling Elephant TusksRead 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 Ferdinand E. Krizan, 77, of Franklinville, NY, pleaded guilty before Chief U.S. District Judge Frank P. Geraci, Jr. to trafficking in prohibited wildlife. The charge carries a maximum penalty of five years in prison and a fine of $250,000.
“Since the passage of the Lacey Act in 1900, Congress and the American people have sought to protect endangered wildlife by outlawing the trafficking in certain vulnerable creatures, said U.S. Attorney Hochul. “Certainly the existential dangers facing elephants – the world’s largest land animal – are well known due to the continuing predations of poachers. But even beyond reasons of conservation, enforcement of wildlife trafficking laws attacks organized criminal groups who most frequently engage in this illegal trade. This Office will continue to vigorously enforce these important laws, both to protect our world’s wildlife for future generations, and to serve as an example for other nations considering similar efforts.”
“Elephants are being slaughtered daily by poachers for their ivory. Each tusk represents one step closer to their extinction, said Edward Grace, Deputy Chief, Office of Law Enforcement for the U.S. Fish and Wildlife Service. “Our special agents and wildlife inspectors are not only working tirelessly to investigate, apprehend, and prosecute the illegal ivory trade in the United States, but we are also working with global counterparts to track criminals abroad. Ivory poachers and traffickers will understand that the U.S. is committed to stopping this heinous activity and we will find you. If the demand for ivory is not reduced, and the illegal activities continue, then these magnificent animals won’t be on our planet for future generations to enjoy.”
“When Governor Cuomo signed a new state law in 2014 to prevent the trade of illegal ivory, the goal was to eliminate this illegal and immoral activity in New York and safeguard imperiled species of animals around the globe,” said New York State Department of Environmental Conservation Acting Commissioner Basil Seggos. “Today’s announcement builds on that promise and serves as a declaration to the public that we will not take this lightly. I applaud the efforts of DEC’s Environmental Conservation Officers and all the agencies involved that brought the perpetrators to justice.”
Assistant U.S. Attorney Aaron J. Mango, who is handling the case, stated that on November 6, 2013, Krizan, owner of Fred’s Antiques in Franklinville, purchased two elephant tusks from an auction house in Montreal, Quebec for $4,320 Canadian dollars. The defendant then had the tusks shipped to an address in Niagara Falls, Ontario.
On November 28, 2013, Krizan transported the tusks from Niagara Falls, Ontario into the United States through the Rainbow Bridge port of entry, violating the Endangered Species Act. Subsequently, on May 31, 2014, the defendant sold the tusks, along with four additional tusks to a buyer in Massachusetts for $50,000 American dollars. At the time of that sale, Krizan knew that the two elephant tusks had been improperly transported into the United States. At no time did the defendant apply for or receive a permit under the Endangered Species Act authorizing the importation, delivery, receipt, transportation, or sale of elephant ivory.
The investigation also determined that the defendant also illegally trafficked in other protected wildlife including:
• a Narwhal tusk, which he sold for $8,000 American dollars in violation of the Marine Mammal Protection Act;
• two elephant tusks, which he sold for $66,000 American dollars;
• a carved elephant ivory art object, which he purchased for $1,020 Canadian dollars;
• one elephant tusk, which he purchased for $3,130.68 Canadian dollars;
• one hippo ivory carving, which he sold for $1,400 American dollars;
• one elephant ivory musician carving, which he sold for $2,525 American dollars;
• one bronze and elephant ivory sosoon figurine, which he sold for $3,700 American dollars;
• one elephant ivory trip-tix, which he sold for $2,700 Canadian dollars; and
• one carved coral figurine, which he sold for $3,400 American dollars.The total value of the wildlife trafficked by the defendant is $141,877.00. As part of the plea, the defendant will also abandon approximately 100 pieces elephant ivory carvings.
The plea is the culmination of an investigation by the U.S. Fish and Wildlife Service, under the direction of Honora Gordon, Special Agent in Charge, Northeast Region, and the New York State Department of Environmental Conservation, under the direction of Captain Frank Lauricella.
Sentencing is scheduled for May 19, 2016 at 10:30 a.m. before Judge Geraci.
Four people indicted for heroin trafficking in YoungstownRead the Press Release
A federal grand jury returned a 29-count indictment charging four people with drug trafficking crimes, said Carole S. Rendon, Acting United States Attorney for the Northern District of Ohio.
Andre L. Duncan, 37, of Brent, Alabama; Morris D. Perry, 37, of Youngstown; Shon D. Rankin, 36, of Youngstown; and Phillip T. Devine, 26, of Leetonia, Ohio, knowingly conspired to possess with the intent to distribute and to distribute heroin between May 2014 and continuing through August 2014, according to the indictment.
Duncan supplied heroin to Rankin and Perry for distribution in the Youngstown area. Perry supplied heroin to Devine for distribution in the Youngstown area, according to the indictment.
It was further part of the conspiracy that cellular telephones, code words and phrases were used by the co-conspirators to facilitate their drug trafficking activities.
If convicted, the defendants’ sentences will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
The investigation preceding the indictment was conducted by the Drug Enforcement Administration. The case is being prosecuted by Assistant United States Attorney David M. Toepfer.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Four Midlands Residents Sentenced to Jail for Mail Theft ConspiracyRead the Press Release
Contact Person: John Potterfield (803) 929-3000
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Columbia, South Carolina---- U.S. Attorney Bill Nettles announced that four individuals were sentenced in federal court in Columbia, SC as part of a mail theft and forgery ring that was operating in the Midlands of South Carolina from July 2014 through November 2014. Johnnie Wayne Martin, III, 50, of Lexington, SC, Sandra Kay Cheeks, 48, of Lexington, SC, Brodie Kale Sexton, 39, of Columbia, SC, and Brandy Michelle Mitchell, 36, of Lexington, SC, were all sentenced by The Honorable Mary Geiger Lewis. The four all plead guilty in federal court in 2015 to an indictment which alleged that the individuals would illegally remove checks from mail boxes and other mail receptacles. The indictment further alleged that the defendants would change the amount and the name of the payee on the check to one of the defendants or the name of an innocent victim whose identification had been illegally obtained by the defendants.
Johnnie Martin, III, was sentenced to a term of imprisonment of 42 months with 3 years of supervision upon release and was ordered to pay $7,616.79 in restitution.
Sandra Cheeks was sentenced to a term of imprisonment of 24 months with 1 year of supervision upon release and was ordered to pay $1,044.28 in restitution.
Brodie Sexton was sentenced to a term of imprisonment of 24 months with 1 year of supervision upon release and was ordered to pay $1,264.76 in restitution.
Brandi Mitchell was sentenced to a term of imprisonment of 10 months with 5 years of supervision upon release and was ordered to pay $302.69 in restitution.
The investigation was conducted by the Midlands Financial Crimes Group, or MFCG, and led by the US Postal Inspection Service Columbia, SC field office. The MFCG is a group of federal, state, and local law enforcement agencies, along with bank investigators and private industry security personnel, that meets once a month to discuss ongoing criminal incidents involving forgery, theft, fraud, identity theft, and other similar white collar crimes in the Midlands of South Carolina.
The case was prosecuted by Assistant US Attorney John Potterfield of the US Attorney’s Office for the District of South Carolina in Columbia, SC.Former Staff Mentor at Florida Keys Children’s Shelter Sentenced to 380 Months’ Imprisonment for Child Sex TraffickingRead the Press Release
A former staff mentor at the Florida Keys Children’s Shelter, a residential facility in Tavernier, Florida, was sentenced today by United States District Judge Marcia G. Cooke to 380 months’ imprisonment, following his conviction for child sex trafficking.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, made the announcement.
Following a three-week jury trial beginning on October 19, 2015, Ricky Jermaine Atkins, 29, of Key Largo, was convicted of conspiracy to engage in the sex trafficking of minors, in violation of Title 18, United States Code, Section 1594(c), as well as two counts of sex trafficking of a minor, in violation of Title 18, United States Code, Section 1591(a)(1). The Court sentenced Atkins to concurrent terms of 380 months’ imprisonment as to each count, to be followed by a lifetime term of supervised release.
Atkins’ co-defendant, Sandra Simon, 24, of Homestead, previously pled guilty to one count of sex trafficking of a minor, in violation of Title 18, United States Code, Section 1591(a)(1). On November 20, 2015, Simon was sentenced to 136 months’ imprisonment.
According to evidence presented at trial, Atkins worked overnight shifts as a staff mentor at the Florida Keys Children’s Shelter, a residential facility in Tavernier for minor children. Atkins obtained two of the children living at the shelter, girls aged fifteen and sixteen, to be brought from Tavernier to a hotel in Cutler Bay, where Simon supervised their prostitution. On the night of August 15, 2014, Atkins personally transported the minor victims from Tavernier to Cutler Bay, where he left them with Simon. Earlier on that day, Simon had pled guilty in state court to procuring a minor for prostitution, and had received a sentence of probation.
Evidence presented at trial further established that Atkins subsequently collected money earned from the minor victims’ prostitution, and delivered to Simon a cellular phone and other items intended to facilitate the prostitution of the minor victims. Further evidence admitted at trial established that Atkins simultaneously prostituted an 18-year-old woman whom Atkins had met while the woman was a minor child living at the shelter.
Mr. Ferrer thanked the FBI’s Child Exploitation Task Force, the State Attorney’s Office Human Trafficking Task Force, the Monroe County Sherriff’s Office and the North Port Police Department for their work on this case. The case is being prosecuted by Assistant U.S. Attorneys Seth M. Schlessinger and Elina A. Rubin-Smith.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Former Schuylkill County Employee Sentenced to 12 Months in Prison for Embezzling $452,186Read the Press Release
HARRISBURG – The United States Attorney’s Office for the Middle District of Pennsylvania announced today that a former Schuylkill County employee, Virginia G. Kunigonis, age 54, of Pottsville, Pennsylvania, was sentenced to 12 months imprisonment by U.S. District Judge William W. Caldwell to embezzling $452,186 from the Schuylkill County Conservation District between 2007 and 2014.
Kunigonis pled guilty in October 2015 before Judge Caldwell to an Information charging her with Theft From Programs Receiving Federal Funds pursuant to a plea agreement with the government. The Schuylkill County Conservation District receives in excess of $10,000 in federal grant monies each year.
According to United States Attorney Peter Smith, the Information alleged Kunigonis forged 437 Conservation District checks totaling $410,435 payable to herself between October of 2007 and May of 2014. The Information also alleged Kunigonis charged $41,751 in personal expenses against a Conservation District credit card during that same time period. Evidence elicited during the sentencing hearing was that the embezzlement scheme was undetected for so long because of the District’s failure to implement adequate internal controls and that Kunigonis used the stolen money, in part, to pay down more than $135,000 in credit card debt.
In addition to her 12 month sentence, Judge Caldwell ordered Kunigonis to pay $452,186 restitution consisting of $3,122 to Schuylkill County and $449,064 to Pennsylvania Counties Risk Pool (PCoRP), Schuylkill County’s bonding company. Judge Caldwell also directed the forfeiture of Kunigonis’ interest in her Pottsville residence, and her interest in her Schuylkill County retirement account.
Kunigonis began working as an administrative assistant for the Schuylkill County Conservation District in approximately 2002. Prior to that she worked in various capacities for Schuylkill County since 1986.
The case was investigated by the Scranton Office of the Federal Bureau of Investigation and is being prosecuted by Assistant U.S. Attorney Kim Douglas Daniel.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Former Parochial Vicar Sentenced for Child Exploitation ChargesRead the Press Release
PHILADELPHIA – Mark Haynes, 56, of West Chester, PA, was sentenced today to 240 months in prison for child sexual abuse and exploitation. Haynes, a former parochial Vicar at Saint Simon and Jude’s Church in West Chester, pleaded guilty on June 8, 2015 to using the Internet to entice a minor to engage in sexual conduct, transfer of obscene material to a minor, distribution of child pornography, possession of child pornography, and destruction or concealment of evidence. In addition to the prison term, U.S. District Court Judge R. Barclay Surrick ordered 10 years of supervised release, a fine of $15,000, and a $700 special assessment.
Around 2010, Haynes posed as a 15-year old girl named “Katie” on a teen pen pal site on Instagram. As “Katie,” Haynes would meet young teenage girls online, engage in sexual chats, and send them child pornography photos and videos in an attempt to entice them to take and send sexually explicit pictures of themselves. Haynes is also charged with distributing other images and videos of children being sexually assaulted over the Internet in 2014. After his arrest by the Chester County Criminal Investigation Division, Haynes was released on bail. While under court supervision, Haynes duped an 86-year old friend of his mother into retrieving his computer from his apartment at the rectory at Saint Simon and Jude’s. Haynes then destroyed the computer, discarding the hard drive in a dumpster in New Jersey. At sentencing, Judge Surrick heard testimony from victims regarding Haynes’ sexual abuse of children from his parish at Saint Ann’s in Phoenixville as far back as 1985 through 1991.
The case was investigated by the FBI in conjunction with the Delaware County Internet Crimes Against Children Task Force and the Chester County Criminal Investigative Division. It was prosecuted by Assistant United States Attorney Michelle Rotella.
Former Marion Man Charged with Receipt and Possession of Child PornographyRead the Press Release
Andrew Schrock, age 32, formerly of Marion, Iowa, has been charged with receipt and possession of child pornography. The charges are contained in an Indictment filed on January 12, 2016, in United States District Court in Cedar Rapids.
The Indictment alleges that, between 2013 and 2014, Schrock received and possessed child pornography.
If convicted, Schrock faces a mandatory minimum sentence of five years’ imprisonment and a possible maximum sentence of 40 years’ imprisonment, a $500,000 fine, a $200 special assessment, and at least five years and up to life on supervised release following any imprisonment.
Schrock appeared on February 9, 2016, in federal court in Cedar Rapids and was held without bond. Schrock’s next appearance for trial is set for April 11, 2016.
As with any criminal case, a charge is merely an accusation and a defendant is presumed innocent until and unless proven guilty.
This case is being prosecuted by Assistant United States Attorney Mark Tremmel and was investigated by the Marion Police Department.
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.”
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is CR 16-0006.
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Former Fugitive Sentenced for Failure to AppearRead the Press Release
DAYTON – Lance Ealy, 29, of Dayton, was sentenced in U.S. District Court to 24 months in prison for failure to appear consecutive to his underlying sentence of 124 months for access device fraud, wire fraud, aggravated identity theft and related charges.
A jury in the Southern District of Ohio convicted Ealy in November 2014 of buying stolen identities online and using the identities to file more than 150 fraudulent federal income tax returns seeking refunds to which he was not entitled.
Ealy failed to appear for his jury trial on November 17, 18 and 19, 2014. He became a fugitive on November 15, 2014, after he removed his electronic monitoring device and fled while under bond conditions. He was recaptured in late March 2015 in Georgia.
He was sentenced for the underlying charges on November 21, 2015.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, United States Marshal Peter Tobin, Guy A. Ficco, Acting Special Agent in Charge, Internal Revenue Service Criminal Investigation (IRS), and Mark Porter, Special Agent in Charge, U.S. Secret Service, announced the latest sentence, which was handed down yesterday by U.S. District Judge Thomas M. Rose.
According to court testimony in the jury trial, between approximately January 2013 and October 2013, Ealy electronically filed at least 150 fraudulent federal income tax returns, including returns filed using the personal information of others that he had unlawfully acquired from an illicit online source. Ealy opened dozens of bank accounts at multiple financial institutions using the names and social security numbers of other individuals – without their knowledge or permission – in order to electronically deposit the fraudulent tax refunds.
The jury convicted Ealy of 46 charges, including one count of illegally possessing 15 or more unauthorized access devices, 11 counts of filing false claims for income tax refunds with the IRS, 14 counts of wire fraud, 14 counts of aggravated identity theft, one count of mail fraud, and one count of using unauthorized access devices to obtain $1,000 or more in a one-year period. An access device includes things such as payment cards and bank account numbers used to access financial accounts.
Ealy was initially charged in a federal complaint filed on October 28, 2013 following an investigation by Secret Service agents that revealed that Ealy had purchased stolen identities from an illicit online source. A federal grand jury initially indicted Ealy in November 2013, charging him with one count of knowingly possessing 15 or more access devices with intent to defraud.
U.S. Attorney Stewart commended the investigation of this case by the United States Marshals Service, Secret Service and IRS-Criminal Investigation agents, and Assistant U.S. Attorneys Alex R. Sistla and Andrew J. Hunt, who are prosecuting the case.
Former Freedom president sentenced to prison for role in chemical spillRead the Press Release
CHARLESTON, W.Va. – The former president of Freedom Industries was sentenced today to 30 days in federal prison, to be followed by a six-month term of supervised release, and a $20,000 fine for environmental crimes connected to the 2014 Elk River chemical spill, announced Acting United States Attorney Carol Casto. Gary Southern, of Marco Island, Florida, previously pleaded guilty in August 2015 to negligently discharging a pollutant, unlawfully discharging refuse matter, and negligently violating an environmental permit by failing to have a pollution prevention plan. Southern is one of six former officials of Freedom Industries, in addition to Freedom Industries itself as a corporation, to be prosecuted for federal crimes associated with the chemical spill.
On January 9, 2014, a major chemical leak was discovered in Charleston at the above-ground storage tank area owned and operated by Freedom Industries (Freedom) on the Elk River. Freedom used these storage tanks to keep and process chemicals, and the leak consisted primarily of 4-methylcyclohexane methanol (MCHM), a chemical used in the coal mining industry as a cleansing agent. A significant amount of MCHM leaked into the Elk River, flowed into a water treatment plant, and contaminated the water supply of Charleston and the surrounding areas for several days. Freedom did not have a permit required by law that would have allowed the company to discharge MCHM into the Elk River.
Southern became associated with Freedom in 2009 and joined its board of directors in March 2010. He became president of Freedom in December 2013, and was serving as Freedom’s president at the time of the chemical spill. In these capacities, Southern was a responsible corporate officer of Freedom from at least March 2010 through January 9, 2014, with the responsibility and the authority to ensure that Freedom and its facility on the Elk River complied with the law.
Freedom had a permit issued by West Virginia’s Department of Environmental Protection that allowed for the discharge of storm water and groundwater subject to monitoring and reporting requirements. However, this permit did not allow for the discharge of MCHM, and required the development and implementation of a storm water plan and a groundwater plan. Generally, storm water and groundwater plans identify potential sources of pollution and outline steps to prevent, contain, and reduce pollutants.
Southern admitted that he was aware of the permit and that he should have known that Freedom was required to have a storm water plan. He further admitted that he had the responsibility and authority to ensure that Freedom complied with the permit by having a storm water and groundwater plan in place. During Southern’s tenure as a responsible corporate officer, Freedom never developed or implemented a storm water or groundwater plan. Southern’s negligence in failing to ensure that Freedom developed and implemented a storm water and groundwater plan was a proximate and contributing cause of the chemical spill.
“We are pleased to bring these cases to conclusion,” said Acting United States Attorney Carol Casto. “Many thought that those responsible for contaminating our water would never see the inside of a courtroom, but six individuals and Freedom Industries now stand convicted and have been sentenced for the offenses that they committed. It is my hope that these prosecutions will serve as a message to others that we will follow the evidence, charge the cases that are developed, and hold those responsible accountable to the extent permitted by law.”
Southern is one of seven defendants that have been sentenced as part of the investigation into the chemical spill. Robert J. Reynolds, of Apex, North Carolina, who worked as an environmental consultant with Freedom, was sentenced on February 1, 2016, for negligently discharging a pollutant. Charles E. Herzing, of McMurray, Pennsylvania, a former owner and vice president of Freedom, was sentenced on February 2, 2016, for unlawfully discharging refuse matter. Freedom, as a corporation, was sentenced on February 4, 2016, for negligently discharging a pollutant, unlawfully discharging refuse matter, and knowingly violating an environmental permit. Michael E. Burdette, of Dunbar, a former plant manager for Freedom’s facility on the Elk River, was sentenced on February 4, 2016, for negligently discharging a pollutant. William E. Tis, of Verona, Pennsylvania, a former owner and secretary of Freedom, was sentenced on February 8, 2016, for unlawfully discharging refuse matter. Dennis P. Farrell, of Charleston, a former Freedom president and owner, was sentenced on February 11, 2016, for unlawfully discharging refuse matter and violating a permit by failing to have a pollution prevention plan.
The investigation of the chemical spill was conducted by the Federal Bureau of Investigation and the Environmental Protection Agency’s Criminal Investigation Division. Assistant United States Attorneys Philip H. Wright, Larry R. Ellis, and Eric P. Bacaj, as well as the Environmental Protection Agency’s Regional Criminal Enforcement Counsel Perry D. McDaniel, handled the prosecutions. United States District Judge Thomas E. Johnston imposed the sentences for each of the defendants.
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Former Dubuque Man Charged with Distribution, Receipt, and Possession of Child PornographyRead the Press Release
Robert Even, age 45, of Bellevue, Iowa, formerly of Dubuque, has been charged with distribution, receipt, and possession of child pornography. The charges are contained in an Indictment unsealed on February 8, 2016, in United States District Court in Cedar Rapids.
The Indictment alleges that, between 2013 and 2014, Even distributed, received, and possessed child pornography.
If convicted, Even faces a mandatory minimum sentence of five years’ imprisonment and a possible maximum sentence of 60 years’ imprisonment, a $750,000 fine, a $300 special assessment, and at least five years and up to life on supervised release following any imprisonment.
Even appeared for a detention hearing on February 11, 2016, in federal court in Cedar Rapids and was released on bond. Even’s next appearance for trial is set for April 11, 2016.
As with any criminal case, a charge is merely an accusation and a defendant is presumed innocent until and unless proven guilty.
This case is being prosecuted by Assistant United States Attorney Mark Tremmel and was investigated by the Dubuque County Sheriff’s Office and the Cedar Rapids Police Department.
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.”
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is CR 16-1002.
Follow us on Twitter @USAO_NDIA.
Former Chief Operating Officer of Davis Bio-Pesticide Company Indicted for Securities FraudRead the Press Release
SACRAMENTO, Calif. — Hector Absi, 47, of Las Vegas, Nevada, was arrested today by FBI agents at his home in Las Vegas. He is charged in a 16-count indictment, unsealed today, that was returned by a federal grand jury in Sacramento on February 11. The indictment charges Absi with conspiracy to commit mail fraud, wire fraud, and securities fraud; substantive counts of mail, wire, and securities fraud; and with other securities-related charges, United States Attorney Benjamin B. Wagner announced.
According to court documents, Absi is the former head of the sales department of Marrone Bio Innovations Inc. (MBI), a company that developed and sold “bio-based” pesticides and is headquartered in Davis, California. Absi also served as MBI’s Chief Operating Officer from January 2014 until his resignation in August 2014. MBI is a publicly traded company; its stock trades on the NASDAQ exchange under the ticker symbol “MBII.” As a publicly traded company, it is required to file quarterly and annual reports with the Securities and Exchange Commission (SEC). In its reports, MBI stated that it recorded revenue in accordance with generally accepted accounting principles (GAAP).
The indictment alleges that, in order to increase sales of MBI products, Absi sold MBI products to customers with side agreements that offered “inventory protection,” under which MBI agreed to either repurchase the product from the customer or extend the terms of payment if the customer was still in possession of the product after a specified time period. Under GAAP, revenue from sales that include such agreements cannot be recognized on the company’s books. The indictment alleges that between March 2013 and July 2014, Absi conspired with at least one other MBI employee to misrepresent to MBI’s accounting department, its external auditors, and the investing public that MBI had made sales under such terms. By concealing the practice, Absi caused MBI to report a doubling of its revenue in 2013 in comparison to 2012. Absi also allegedly conspired with others to backdate the delivery of certain shipments of MBI’s products to enhance MBI’s reported revenues for the quarter. Absi received a performance-based bonus and exercised stock options during a time when MBI’s inflated revenue figures were being reported.
“It is critical to the integrity of the securities markets that we criminally prosecute those who act to profit by deceiving those markets and the investing public who rely on the accuracy of publicly filed reports,” said U.S. Attorney Wagner. “I am pleased that we have been able to coordinate effectively with the SEC in this matter.”
“We thank the SEC for their partnership in this successful investigation. Such collaboration is essential to the success of securities fraud investigations and ultimately protecting the integrity of the securities market,” said Assistant Special Agent in Charge Manuel Alvarez of the Federal Bureau of Investigation’s Sacramento field office. “Securities fraud is something most associate with Wall Street, not our region; however, our region is home to many successful, publicly traded companies. Unfortunately, this success also attracts greed-based crime and we will work with our partners to root out those who seek to deceive investors by manipulating revenue data.”
“We allege that Marrone Bio misled investors to make itself look like a fast-growing new public company,” said Jina L. Choi, Director of the SEC’s San Francisco Regional Office. “Public companies and their officers should know better that taking shortcuts to recognize revenue in the near term is harmful to investors and can be damaging to a company’s long-term success.”
This case is the product of an investigation by the Federal Bureau of Investigation. Assistant United States Attorney Todd A. Pickles is prosecuting the case.
The Securities and Exchange Commission has also conducted an investigation into the conduct of Hector Absi while he was an officer of MBI. Today it filed a civil complaint against Absi in the U.S. District Court for the Eastern District of California, alleging that Absi violated the Securities Act of 1933, and the Securities Exchange Act of 1934, and federal rules issued under the Exchange Act, and seeking an injunction against Absi, disgorgement of wrongfully obtained benefits, and civil penalties.
If convicted, Absi faces a maximum statutory penalty of 25 years in prison and a $5 million fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Former Chief Operating Officer of Davis Bio-Pesticide Company Indicted for Securities FraudRead the Press Release
SEC Files Separate Civil Complaint
Hector Absi, 47, of Las Vegas, Nevada, was arrested today by FBI agents at his home in Las Vegas. He is charged in a 16-count indictment, unsealed today, that was returned by a federal grand jury in Sacramento, California, on February 11. The indictment charges Absi with conspiracy to commit mail fraud, wire fraud and securities fraud; substantive counts of mail, wire and securities fraud; and with other securities-related charges, U.S. Attorney Benjamin B. Wagner for the Eastern District of California announced.
According to court documents, Absi is the former head of the sales department of Marrone Bio Innovations Inc. (MBI), a company that developed and sold “bio-based” pesticides and is headquartered in Davis, California. Absi also served as MBI’s Chief Operating Officer from January 2014 until his resignation in August 2014. MBI is a publicly traded company; its stock trades on the NASDAQ exchange under the ticker symbol “MBII.” As a publicly traded company, it is required to file quarterly and annual reports with the Securities and Exchange Commission (SEC). In its reports, MBI stated that it recorded revenue in accordance with generally accepted accounting principles (GAAP).
The indictment alleges that, in order to increase sales of MBI products, Absi sold MBI products to customers with side agreements that offered “inventory protection,” under which MBI agreed to either repurchase the product from the customer or extend the terms of payment if the customer was still in possession of the product after a specified time period. Under GAAP, revenue from sales that include such agreements cannot be recognized on the company’s books. The indictment alleges that between March 2013 and July 2014, Absi conspired with at least one other MBI employee to misrepresent to MBI’s accounting department, its external auditors and the investing public that MBI had made sales under such terms. By concealing the practice, Absi caused MBI to report a doubling of its revenue in 2013 in comparison to 2012. Absi also allegedly conspired with others to backdate the delivery of certain shipments of MBI’s products to enhance MBI’s reported revenues for the quarter. Absi received a performance-based bonus and exercised stock options during a time when MBI’s inflated revenue figures were being reported.
“It is critical to the integrity of the securities markets that we criminally prosecute those who act to profit by deceiving those markets and the investing public who rely on the accuracy of publicly filed reports,” said U.S. Attorney Wagner. “I am pleased that we have been able to coordinate effectively with the SEC in this matter.”
“We thank the SEC for their partnership in this successful investigation,” said Assistant Special Agent in Charge Manuel Alvarez of the FBI’s Sacramento Field Office. “Such collaboration is essential to the success of securities fraud investigations and ultimately protecting the integrity of the securities market. Securities fraud is something most associate with Wall Street, not our region; however, our region is home to many successful, publicly traded companies. Unfortunately, this success also attracts greed-based crime and we will work with our partners to root out those who seek to deceive investors by manipulating revenue data.”
“We allege that Marrone Bio misled investors to make itself look like a fast-growing new public company,” said Director Jina L. Choi for the SEC’s San Francisco Regional Office. “Public companies and their officers should know better that taking shortcuts to recognize revenue in the near term is harmful to investors and can be damaging to a company’s long-term success.”
This case is the product of an investigation by the FBI. Assistant U.S. Attorney Todd A. Pickles is prosecuting the case.
SEC has also conducted an investigation into the conduct of Hector Absi while he was an officer of MBI. Today it filed a civil complaint against Absi in the U.S. District Court for the Eastern District of California, alleging that Absi violated the Securities Act of 1933 and the Securities Exchange Act of 1934 and federal rules issued under the Exchange Act and seeking an injunction against Absi, disgorgement of wrongfully obtained benefits, and civil penalties.
If convicted, Absi faces a maximum statutory penalty of 25 years in prison and a $5 million fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Former Bank Officer Sentenced to 41 Months’ in Federal Prison for EmbezzlementRead the Press Release
A former officer of the board of Country Bancorporation who embezzled more than $1,000,000 over nearly a decade was sentenced on February 16, 2016, to more than three years in federal prison.
Heidi Wagler, age 50, from Wayland, Iowa, received the prison term after a October 6, 2015, guilty plea to one count of embezzlement by a bank officer.
In a plea agreement, Wagler admitted that from June 2004 through October 2013 she embezzled at least $864,835 from Country Bancorporation, which controlled seven banks, by paying herself salary to which she was not entitled. At the time, Wagler was an officer and employee of Country Bancorporation and was in charge of doing payroll for each of these banks. She was also a member of the Board of Directors of one of the banks and her husband, Russell Wagler, was the Director, President, and CEO of that same bank. Wagler further admitted that, although she was entitled to compensation from Country Bancorporation for doing the payroll for its banks, she paid herself excess compensation from each of the seven banks at various times over the course of her embezzlement. At sentencing, she also admitted that, from January 2008 through November 2013, she paid her husband more than $200,000 in additional compensation to which he was not entitled. At the sentencing hearing, the judge stated that Wagler’s crime was a “pure crime of greed, of avarice.”
Wagler was sentenced in Cedar Rapids by United States District Court Chief Judge Linda R. Reade. Wagler was sentenced to 41 months’ imprisonment and fined $50,000. A special assessment of $100 was imposed, and she was ordered to make $1,065,799 in restitution to Country Bancorporation. She must also serve a five-year term of supervised release after the prison term. There is no parole in the federal system.
Wagler was released on the conditions of release previously set and is to surrender to the Bureau of Prisons on a date yet to be set.
The case was prosecuted by Assistant United States Attorney Anthony Morfitt and investigated by the Federal Bureau of Investigation and Federal Deposit Insurance Corporation.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 15-CR-00089.
Follow us on Twitter @USAO_NDIA.
Former Army Reserve Staff Sergeant Sentenced to 21 Months in Prison for Bulk Cash Smuggling and Theft of Government Property while Serving in AfghanistanRead the Press Release
A Fort Buchanan Army Reserve Staff Sergeant was sentenced today to 21 months in prison for bulk cash smuggling of $113,050 and theft of government property worth $6,302.69 while serving in Afghanistan.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Rosa Emilia Rodríguez-Vélez of the District of Puerto Rico, Special Agent in Charge Douglas A. Leff of the FBI’s San Juan, Puerto Rico, Division, Acting Special Agent in Charge James M. Gibbons of the U.S. Immigration and Customs Enforcement-Homeland Security Investigations (ICE-HSI) Chicago Field Office, Special Inspector General for Afghanistan Reconstruction John F. Sopko, Director Frank Robey of the U.S. Army Criminal Investigation Command’s (CID) Major Procurement Fraud Unit and Special Agent in Charge Robert E. Craig Jr. of the Defense Criminal Investigative Service’s (DCIS) Mid-Atlantic Field Office made the announcement.
On July 15, Luis Ramon Casellas, 42, of Canóvanas, Puerto Rico, pleaded guilty before U.S. Magistrate Judge Camille L. Velez-Rive of the District of Puerto Rico to three counts of bulk cash smuggling and one count of theft of government property. In addition to imposing the prison term, U.S. District Judge Carmen Consuelo Cerezo of the District of Puerto Rico ordered Casellas to forfeit $113,050.
Casellas was an Army Reservist Staff Sergeant on active status based at Fort Buchanan in Guaynabo, Puerto Rico. In April 2013, Casellas was deployed by the Army to Kandahar Airfield in Afghanistan. As part of his duties, Casellas was responsible for helping to break down smaller bases in preparation for the withdrawal of U.S. military forces from Afghanistan. These duties included retrieving U.S. government property for future use and selling as scrap to Afghan contractors.
Between June 17 and Aug. 9, 2013, Casellas was the leader of the three-person Army team that went to a Forward Operating Base (FOB) in Afghanistan to help break down that base. In connection with his guilty plea, Casellas admitted that while this team was at the FOB, he stole tools and equipment, including laptops, belonging to the U.S. Department of Defense. Casellas also admitted that, in July 2013, he sent approximately eight boxes from the FOB through the U.S. Postal Service addressed to his wife in Puerto Rico, and that the boxes contained some of the government property and undeclared U.S. currency totaling $50,500.
In addition, in August 2013, Casellas sent two boxes from Kandahar Airfield through UPS, again addressed to his wife in Puerto Rico, that were marked as “gifts for family.” In connection with his plea, Casellas admitted that, although he declared that the items inside the boxes were valued at $700 and $400, respectively, one box contained some of the stolen government property as well as $41,750 in U.S. currency, and the other box contained $20,800 in U.S. currency. These boxes were intercepted by U.S. Customs in Louisville, Kentucky.
This case was investigated by the Special Inspector General for Afghanistan Reconstruction, the FBI, ICE-HSI, Army CID and DCIS, with assistance from the Defense Contract Audit Agency. This case was prosecuted by Trial Attorney Daniel P. Butler of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys Julia M. Meconiates and Myriam Fernandez of the District of Puerto Rico.
Fifty-One Hospitals Pay United States More Than $23 Million to Resolve False Claims Act Allegations Related to Implantation of Cardiac DevicesRead the Press Release
The Department of Justice has reached settlements with 51 hospitals in 15 states for more than $23 million related to cardiac devices that were implanted in Medicare patients in violation of Medicare coverage requirements, the Department of Justice announced today. These settlements represent the final stage of a nationwide investigation into the practices of hundreds of hospitals improperly billing Medicare for these devices. With these additional agreements, the Justice Department’s investigation has now yielded settlements with more than 500 hospitals totaling more than $280 million.
“These settlements demonstrate the Department’s continued vigilance in pursuing hospitals and health systems that violate Medicare’s national coverage rules,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “We will hold accountable those who do not abide by the government’s rules in order to protect the federal fisc and, more importantly, patient health.”
An implantable cardioverter defibrillator, or ICD, is an electronic device that is implanted near and connected to the heart. It detects and treats chaotic, extremely fast, life-threatening heart rhythms, called fibrillations, by delivering a shock to the heart, restoring the heart’s normal rhythm. It is similar in function to an external defibrillator (often found in offices and other buildings) except that it is small enough to be implanted in a patient’s chest. Only patients with certain clinical characteristics and risk factors qualify for an ICD covered by Medicare.
Medicare coverage for the device, which costs approximately $25,000, is governed by a National Coverage Determination (NCD). The Centers for Medicare and Medicaid Services implemented the NCD based on clinical trials and the guidance and testimony of cardiologists and other health care providers, professional cardiology societies, cardiac device manufacturers and patient advocates. The NCD provides that ICDs generally should not be implanted in patients who have recently suffered a heart attack or recently had heart bypass surgery or angioplasty. The medical purpose of a waiting period - 40 days for a heart attack and 90 days for bypass/angioplasty - is to give the heart an opportunity to improve function on its own to the point that an ICD may not be necessary. The NCD expressly prohibits implantation of ICDs during these waiting periods, with certain exceptions. The Department of Justice alleged that from 2003 to 2010, each of the settling hospitals implanted ICDs during the periods prohibited by the NCD.
“The settlements announced last October and today demonstrate the Department of Justice’s commitment to protect Medicare dollars and federal health benefits,” said U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida. “Guided by a panel of leading cardiologists and the review of thousands of patients’ charts, the extensive investigation behind the settlements was heavily influenced by evidence-based medicine. In terms of the number of defendants, this is one of the largest whistleblower lawsuits in the United States and represents one of this office’s most significant recoveries to date. Our office will continue to vigilantly protect the Medicare program from potential false billing claims.”
“We will not stand idly by while Medicare coverage rules are ignored,” said Inspector General Daniel R. Levinson of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG). “OIG worked closely with the Department of Justice to ensure such violators made substantial payments to settle these false billing claims.”
The department previously settled with 457 hospitals for more than $250 million.
The settlements announced today involve 51 hospitals, which are listed on the attached chart. Most of the settling defendants were named in a qui tam, or whistleblower, lawsuit brought under the False Claims Act, which permits private citizens to bring lawsuits on behalf of the United States and receive a portion of the proceeds of any settlement or judgment awarded against a defendant. The lawsuit was filed in federal district court in the Southern District of Florida by Leatrice Ford Richards, a cardiac nurse and Thomas Schuhmann, a health care reimbursement consultant. The whistleblowers have received more than $3.5 million from the settlements announced today.
The settlements were the result of a coordinated effort among the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office of the Southern District of Florida and HHS-OIG’s Office of Investigations and Office of Counsel to the Inspector General.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. 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 this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of 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.
The claims resolved by these settlements are allegations only and there has been no determination of liability.
This lawsuit is captioned U.S. ex rel. Ford et al. v. Abbott Northwestern et al. No. 08-cv-20071 (S.D. Fla.)
Federal Prison for ID Theft and Credit Card FraudstersRead the Press Release
CORPUS CHRISTI, Texas - Ibrahin Suarez-Venerao, 29, and San Juanita Avalos, 32, both of Corpus Christi, have each been sentenced to more than five years in federal prison for credit card fraud and identity theft, announced U.S. Attorney Kenneth Magidson. Both pleaded guilty to the charges June 15, 2015.
Today, Senior U.S. District Judge John D. Rainey ordered Suarez-Venerao to serve 40 months for the fraud as well as a mandatory and consecutive 24 months for the identity theft. The total 64-month sentence will be immediately followed by three years of supervised release. Judge Rainey had previously sentenced Avalos to 61 months in federal prison – 37 months for the fraud and 24 months for identity theft - followed by three years of supervised release. Both defendants were further ordered to pay $29,551.00 in restitution.
The case began following the receipt of numerous credit card fraud complaints. Investigators with the Corpus Christi Police Department (CCPD) used store surveillance footage and were able to identify Suarez-Venerao and Avalos using counterfeit credit cards to make thousands of dollars in purchases. The purchases were made at area merchants including Wal-Mart and Home Depot. Officers executed a search warrant and discovered a credit card embossing machine, fake identification documents, counterfeit credit cards, more than 300 gift cards worth $5,300 and more than $16,000 in cash. A search of the computers at the residence revealed almost 500 more compromised credit card numbers.
Both defendants were ordered to remain in custody pending transfer to a U.S. Bureau of Prisons Facility.
The charges were the result of an investigation conducted by CCPD and the U.S. Secret Service. Assistant United States Attorney Robert D. Thorpe Jr. prosecuted the cases.
Federal Grand Jury in Nevada Indicts Cliven Bundy and Four Others for Felony Crimes Related to 2014 StandoffRead the Press Release
LAS VEGAS, Nev. – Nevada resident Cliven Bundy and four others were indicted by the federal grand jury today on 16 felony charges related to the armed assault against federal law enforcement officers that occurred in the Bunkerville, Nev. area on April 12, 2014.
U.S. Attorney Daniel G. Bogden for the District of Nevada, Special Agent in Charge Laura Bucheit for the FBI in Nevada, and Bureau of Land Management Director Neil Kornze made the announcement.
“The rule of law has been reaffirmed with these charges,” said U.S. Attorney Bogden. “Persons who use force and violence against federal law enforcement officers who are enforcing court orders, and nearly causing catastrophic loss of life or injury to others, will be brought to justice.”
“This indictment sends a resounding message to those who wish to participate in violent acts that our resolve to pursue them and enforce the law remains unwavering,” said Special Agent in Charge Bucheit.
“Today marks a tremendous step toward ending more than 20 years of law breaking,” said Bureau of Land Management Director Neil Kornze. “The nation's public lands belong to all Americans.”
Cliven D. Bundy, 69, of Bunkerville, Nev., Ryan C. Bundy, 43, of Mesquite, Nev., Ammon E. Bundy, 40, of Emmet, Idaho, Ryan W. Payne, 32, of Anaconda, Mont., and Peter T. Santilli, Jr., 50, of Cincinnati, Ohio, are charged with one count of conspiracy to commit an offense against the United States, one count of conspiracy to impede or injure a federal officer, four counts of using and carrying a firearm in relation to a crime of violence, two counts of assault on a federal officer, two counts of threatening a federal law enforcement officer, three counts of obstruction of the due administration of justice, two counts of interference with interstate commerce by extortion, and one count of interstate travel in aid of extortion. The indictment also alleges five counts of criminal forfeiture which upon conviction would require forfeiture of property derived from the proceeds of the crimes totaling at least $3 million, as well as the firearms and ammunition possessed and used on April 12, 2014.
The defendants are currently in custody in Oregon. Their arraignments on these charges have not yet been set.
The indictment states that the charges result from a massive armed assault against federal law enforcement officers that occurred in and around Bunkerville, Nev., on April 12, 2014. The defendants are alleged to have planned, organized, and led the assault in order to extort the officers into abandoning approximately 400 head of cattle that were in their lawful care and custody. In addition to conspiring among themselves to plan and execute these crimes, the defendants recruited, organized, and led hundreds of other followers in using armed force against law enforcement officers in order to thwart the seizure and removal of Cliven Bundy’s cattle from federal public lands. Bundy had trespassed on the public lands for over 20 years, refusing to obtain the legally-required permits or pay the required fees to keep and graze his cattle on the land.
The indictment charges that Cliven Bundy was the leader, organizer, and chief beneficiary of the conspiracy, and possessed ultimate authority over the conspiratorial operations and received the economic benefits of the extortion. The remaining defendants are charged as leaders and organizers who conspired with Bundy to achieve his criminal objectives.
The maximum penalties for the charges are stated below.
Conspiracy to Commit an Offense Against the U.S. – 5 years, $250,000 fine
Conspiracy to Impede and Injure a Federal Law Enforcement Officer – 6 years, $250,000 fine
Assault on a Federal Law Enforcement Officer – 20 years, $250,000 fine
Threatening a Federal Law Enforcement Officer – 10 years, $250,000 fine
Use and Carry of a Firearm in Relation to a Crime of Violence – 5 years minimum and consecutive
Obstruction of the Due Administration of Justice - 10 years, $250,000 fine
Interference with Interstate Commerce by Extortion - 20 years, $250,000 fine
Interstate Travel in Aid of Extortion – 20 years, $250,000 fine
The case is being investigated by the FBI and the Bureau of Land Management. It is being prosecuted by Assistant U.S. Attorneys Steven W. Myhre and Nicholas D. Dickinson and Special Assistant U.S. Attorneys Nadia J. Ahmed and Erin M. Creegan.
The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
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Federal Government Contractor Sentenced to Prison for Accepting Kickbacks and Tax EvasionRead the Press Release
Concealed Receipt of Approximately $2 Million in Kickbacks from IRS
An Enterprise, Alabama, resident was sentenced today in the Southern District of Florida to 48 months in prison to be followed by three years of supervised release for accepting unlawful kickbacks and tax evasion, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division.
According to court documents and statements made in open court, Victor Villalobos, 47, worked for a federal prime contractor at Fort Rucker, Alabama. In 2009, Villalobos approached Maxim Silinsky, a Florida-based subcontractor for this company, and solicited illegal kickbacks on the federal subcontracts that Silinsky held in connection with the federal prime contractor. Villalobos agreed that in exchange for kickback payments he would refrain from conduct that would unfavorably affect Silinsky’s business relationship with the federal prime contractor and help ensure that he obtained additional business.
As part of his plea, Villalobos admitted that from June 2009 to December 2014, he received approximately 57 separate wire transfers totaling more than $1.9 million in kickback payments from various foreign and domestic bank accounts controlled by Silinsky. At two separate meetings in 2015, Villalobos accepted envelopes from Silinsky containing cash kickbacks totaling $60,000. Between June 2009 and February 2015, Villalobos attempted to conceal his receipt of the kickbacks by forming nominee entities and opening nominee bank accounts. Villalobos also admitted that he evaded paying income taxes on the kickback payments by causing false federal income tax returns to be filed with the Internal Revenue Service (IRS).
In addition to his prison sentence, U.S. District Judge Daniel T.K. Hurley ordered Villalobos to pay $542,562 in restitution to the IRS. As part of his plea agreement, Villalobos also agreed to be permanently debarred from federal government contracting.
Silinsky pleaded guilty to filing a false tax return in November 2015 and cooperated in the investigation and prosecution of Villalobos. Silinsky was sentenced to one year and one day in prison on Feb. 2. Silinsky also cooperated in the investigation and prosecution of Trevor Smith, a retired U.S. Air Force Master Sergeant who pleaded guilty in October 2015 to unlawfully disclosing confidential procurement information and filing a false tax return. On Jan. 28, Smith was sentenced to 18 months in prison.
Acting Assistant Attorney General Ciraolo commended special agents of IRS Criminal Investigation, the U.S. Air Force’s Office of Special Investigations, the Department of Defense’s Office of the Inspector General and the U.S. Army’s Criminal Investigation Division, who investigated this case and Trial Attorneys Charles M. Edgar Jr. and Jason H. Poole of the Tax Division, who prosecuted this case. Acting Assistant Attorney General Ciraolo also thanked the U.S. Attorney’s Office of the Southern District of Florida for their substantial assistance.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Farmington Man Sentenced to Prison for Violating Federal Firearms LawsRead the Press Release
ALBUQUERQUE – Michael Graham, 43, of Farmington, N.M., was sentenced today in federal court in Albuquerque, N.M., to 46 months in prison for unlawfully possessing a firearm and ammunition. He will be on supervised release for two years after completing his prison sentence.
Graham was charged in an indictment on Aug. 26, 2014, with being a felon in possession of firearms and ammunition on Feb. 9, 2014, in San Juan County, N.M. At the time, Graham was prohibited from possessing firearms or ammunition because he had previously been convicted of accessory to bringing contraband into a jail, aggravated assault, and being a felon in possession of a firearm.
Graham pled guilty to the indictment on July 8, 2015, and admitted that on Feb. 9, 2014, he possessed a loaded pistol with an obliterated serial number in Farmington. Graham also admitted knowing he was prohibited from possessing firearms or ammunition because of his status as a convicted felon.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Farmington Police Department and was prosecuted by Assistant U.S. Attorney Paul Mysliwiec.
Essex County, New Jersey, Man Charged with Bank Robbery SpreeRead the Press Release
NEWARK, N.J. – A Newark, New Jersey, man was charged today with committing five bank robberies in Union and Essex Counties from August 2015 through October 2015, U.S. Attorney Paul J. Fishman announced.
James Glenn, 59, of Newark, New Jersey, is charged by criminal complaint with five counts of bank robbery. He appeared this afternoon before U.S. Magistrate Judge Leda D. Wettre in Newark federal court and was detained.
According to the complaint, Glenn robbed the following New Jersey banks on the dates set forth below:
Bank
Location
Date
Connect One Bank
Union
Aug. 28, 2015
Hudson City Savings Bank
Roseland
Sept. 9, 2015
TD Bank
Orange
Sept. 25, 2015
Connect One Bank
Union
Sept. 28, 2015
Santander Bank
Union
Oct. 16, 2015
Glenn typically robbed the banks using notes that threatened physical harm and demanded cash. For instance, during the Sept. 9, 2015 robbery, Glenn handed the teller a handwritten note indicating, “[t]his is a robbery . . . [t]his is not your money so be careful – [n]o alarms [n]o dye pack I know them. No one wants to get hurt so remember I know where you live.” Also, during the spree, Glenn robbed the same Connect One Bank in Union, New Jersey, including threatening the same teller, on Aug. 28, 2015 and Sept. 28, 2015. He was arrested by the Union Township police department on Oct. 27, 2015.
The bank robbery charges each carry a maximum potential penalty of 20 years in prison and a $250,000 fine.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Acting Special Agent in Charge Andrew Campi in Newark, with the investigation leading to the charges. He also thanked the Union Township, Roseland, and Orange police departments, as well as the Union County Prosecutor’s Office, the Essex County Prosecutor’s Office, and the NJ State Parole Board for their assistance.
The government is represented by Assistant U.S. Attorney Jihee G. Suh of the U.S. Attorney’s Office General Crimes Unit in Newark.
The charges and the allegations contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Defense counsel: Leticia Olivera Esq., Assistant Federal Public Defender
East Carondelet Man Charged with Possession, Distribution and Receipt of Child PornographyRead the Press Release
James L. Porter, Acting United States Attorney for the Southern District of Illinois, announced today that on February 12, 2016, Richard Lee Doerr, III, 28, East Carondelet, IL, was arraigned on a five-count Indictment charging him, in Count 1, with Distribution of Child Pornography, in Counts 2-4, with Receipt of Child Pornography, and, in Count 5, with Possession of Prepubescent Child Pornography. Doerr was ordered detained, that is, held without bond, after a detention hearing today.
Count 1 alleges that, on or about December 27, 2013, Doerr knowingly distributed at least four visual depictions of child pornography, as described in the Indictment. Counts 2 through 4 allege that, on July 11, August 31, and September 1, 2014, respectively, Doerr knowingly received at least seven (7) visual depictions of child pornography, as described in the Indictment. Finally, Count 5 alleges that, on or about October 2, 2014, Doerr knowingly possessed material that contained child pornography that involved prepubescent minors or minors who had not attained 12 years of age, as described in the Indictment.
Trial is scheduled for April 4, 2016, in East St. Louis, Illinois. The penalty for Distribution and Receipt of Child Pornography is a term of imprisonment of not less than five (5) years but not more than twenty (20) years, a fine up to $250,000, and a term of supervised release of not less than five (5) years to life. The penalty for Possession of Prepubescent Child Pornography is a term of imprisonment of not more than twenty (20) years, a fine up to $250,000, and a term of supervised release of not less than five (5) years to life.
An indictment is merely the method by which federal charges are lodged. A defendant is presumed innocent until proven guilty beyond a reasonable doubt.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in 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."
The case was investigated by the Federal Bureau of Investigation's Springfield Child Exploitation Task Force. The case is assigned to Assistant United States Attorney Angela Scott.
Deported Jamaican Gets 18 Months in Prison for Re-entering U.S. without PermissionRead the Press Release
JOHNSTOWN, Pa. - A citizen of Jamaica has been sentenced in federal court to 18 months in prison and upon his release, after notice and hearing, deported to Jamaica, on his conviction of re-entry of an illegal alien, United States Attorney David J. Hickton announced today.
United States District Judge Kim R. Gibson imposed the sentence on Hubert E. Minott, 32, of North Miami Beach, FL.
According to information presented to the court, on Feb. 6, 2014, Minott, an alien who had been deported from the United States on June 12, 2008, was found in Somerset County, PA. He had unlawfully re-entered this country without receiving permission from the Secretary of the Department of Homeland Security to do so.
Assistant United States Attorney John J. Valkovci, Jr. prosecuted this case on behalf of the government.
Mr. Hickton commended the Department of Homeland Security/Immigration and Customs Enforcement for the investigation leading to the successful prosecution of Minott.
Danville Man Pleads Guilty to Manufacturing and Distributing Illegal Dietary SupplementsRead the Press Release
ABINGDON, VIRGINIA – A Danville business owner, who manufactured and shipped illegal pro-hormones, designer steroids, throughout the United States, pled guilty today in the United States District Court for the Western District of Virginia in Abingdon.
Steven Donald Wood, 37, of Danville, Va., waived his right to be indicted today and pled guilty to a one count Information charging him with illegally distributing misbranded drugs in interstate commerce. Wood agreed to forfeit $1.5 million in U.S. currency to the Government and has paid the forfeiture obligation in full prior to pleading guilty. Wood will be sentenced on May 17, 2016, at 10:30 a.m.
“The misbranding of drugs is a serious offense that puts those who ingest these substances in danger,” United States Attorney John P. Fishwick Jr. said today. “I am grateful to our law enforcement partners who continue to investigate the misbranding of these powerful steroids.”
Wood, through his business entities Competitive Edge Labs, LLC, and MKZ Exports, LLC, caused the manufacture and distribution of large amounts of dietary supplements, specifically “pro-hormones,” a new generation of steroids not specifically listed as an anabolic steroid under the Controlled Substances Act. Wood obtained his raw powder from Xinli “Eric” Li, a Chinese national, who pleaded guilty in federal court in Abingdon on December 4, 2015. Li, who forfeited $1.6 million, will be sentenced in Abingdon on March 9, 2016, at 2:30 p.m.
Dade City Gang Member Sentenced to 17 Years for Gun and Drug OffensesRead the Press Release
Tampa, Florida – U.S. District Judge Susan C. Bucklew yesterday sentenced Seguiel Medrano (31, Dade City) to 17 years in federal prison for drug distribution and firearm charges. Medrano pleaded guilty on October 15, 2015.
According to court documents, Medrano, a member of a Dade City street gang, sold methamphetamine to undercover law enforcement officers, and was armed during the drug transactions. During a search of Medrano’s residence, law enforcement seized multiple firearms, ammunition, narcotics, and cash.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Pasco County Sheriff’s Office. It was prosecuted by Assistant United States Attorney Stacie B. Harris.
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. It is also a part of ATF’s Frontline strategy to reduce violent crime in our communities.
Court Awards Judgment Against Cosmetology School in Aiken for Federal Education Grant and Loadn FraudRead the Press Release
Contact Person: Robert Sneed (803) 929-3000
Columbia, South Carolina – The United States District Court of South Carolina awarded a $9,283,123.00 default judgment against Lacy School of Cosmetology and Earnest “Jay” Lacy, for presenting false claims to the U.S. Department of Education for federal student loans and grants, the United States Attorney for the District of South Carolina William Nettles announced today.
This is a default judgment which the Court granted after the Defendants failed to answer the Complaint or the entry of default. This civil default judgment is based on a lawsuit originally filed under the qui tam, or whistleblower, provision of the False Claims Act, which allows private persons with knowledge of false claims to bring civil actions on behalf of the government and to share in any recovery. The whistleblower in this case was represented by the Richard A. Harpootlian Law Firm, of Columbia. The lawsuit was filed in the District of South Carolina, Case Number 1:13-cv-00218. Jay Lacy was the President and CEO of the Lacy School of Cosmetology, which before it closed, had four offices in South Carolina: Aiken (main campus), Lexington, Goose Creek, and Charleston. The United States Department of Education approved the school to participate in federal student aid programs. Through its investigation the government learned that the school misappropriated funds by knowingly failing to comply with numerous federal program regulatory requirements, making unauthorized disbursements of federal student aid funds, failing to refund student credit balances, and concealing its actions by submitting false statements of compliance. The total award of $9,283,123 is based on damages and statutory penalties. The Court held that the government’s actual damages were $2,185,041, which is based on Pell Grants ($2,078,448) and federally backed student loans ($106,593). The False Claims Act requires these damages to be “trebled” (tripled) for a total amount of $6,555,123. Additionally, the False Claims Act imposes a statutory civil penalty ranging from $5,500 to $11,000 per violation; under the minimum civil penalties imposed here, the total civil penalty was $2,728,000. “This use of the False Claims Act shows we are on the leading edge of qui tam litigation across the country,” said U.S. Attorney Nettles. “Through this type of litigation we continue our efforts to stop fraud and protect federal funds.” The case was the result of a coordinated effort among Assistant United States Attorneys Rob Sneed and Fran Trapp of the United States Attorney’s Office for the District of South Carolina and agents for the U.S. Department of Education. #####Clay County felon sentenced to over eight years in prison for Federal gun crimeRead the Press Release
CHARLESTON, W.Va. – A Clay County man was sentenced today to eight years and four months in federal prison for being a felon in possession of a firearm, announced Acting United States Attorney Carol Casto. Lloyd Ellis Rapp, 44, of Duck, previously pleaded guilty in November 2015 to the federal gun crime.
Rapp admitted that on June 15, 2015, he was fleeing on his motorcycle from the West Virginia State Police. The high-speed chase ended with Rapp wrecking his motorcycle. After the wreck, he was arrested and law enforcement found Rapp in possession of a Hi-Point Model C-9, 9mm semiautomatic handgun. Rapp was prohibited from possessing any firearm under federal law because of a 2008 felony conviction in United States District Court, Southern District of West Virginia, for distribution of methamphetamine.
The West Virginia State Police and the Bureau of Alcohol, Tobacco, Firearms and Explosives conducted the investigation. Assistant United States Attorney Timothy D. Boggess handled the prosecution. The sentence was imposed by United States District Judge John T. Copenhaver, Jr.
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 that target gun crime.
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Charlotte Man Sentenced to More Than 10 Years in Prison on Drug and Firearm ChargesRead the Press Release
CHARLOTTE, N.C. – Today, U.S. District Judge Max O. Cogburn, Jr. ordered Jerry Lee Edwards, 30, of Charlotte, to serve 130 months in prison and three years of supervised release on drug and firearm charges, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina.
U.S. Attorney Rose is joined in making today’s announcement by C.J. Hyman, Special Agent in Charge of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Charlotte Field Division and Chief Kerr Putney of the Charlotte Mecklenburg Police Department (CMPD).
According to filed court documents and statements made in court, on August 15, 2013, while investigating criminal activity near the Sugar Creek/Interstate 85 corridor, law enforcement arrested Edwards, who was in a vehicle parked in a hotel parking lot in the area. According to court records, at the time of his arrest, Edward possessed cocaine, crack cocaine, and a set of digital weight scales. Law enforcement also recovered three firearms, one of which was later determined to be stolen. According to court records, Edwards has a prior North Carolina conviction of robbery with a dangerous weapon and is prohibited from possessing a firearm.
Court records show that in May 2014, Edwards was found guilty by a bench trial of one count of possession with intent to distribute crack cocaine, one count of possession with intent to distribute cocaine, one count of possession of a firearm during and in relation to a drug trafficking crime and one count of possession of a firearm by a convicted felon.
In handing down today’s sentence, Judge Cogburn stated that, “Edwards had a very serious criminal record, and a 130-month sentence will hold him responsible for his criminal actions. Individuals with that many firearms in their vehicle are up to no good.”
Edwards has been in federal custody since August 2013. He will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
The investigation was handled by ATF and CMPD. The case was handled by Assistant United States Attorney Sanjeev Bhasker of the U.S. Attorney’s Office in Charlotte.
Career Offender Sentenced to 16 Years in Prison for Committing Three Armed Robberies in Maryland in Six WeeksRead the Press Release
Greenbelt, Maryland – U.S. District Judge George J. Hazel sentenced James Davis, age 57, formerly of Washington, D.C., today to 16 years in prison followed by three years of supervised release for conspiring to commit robbery, robbery of money belonging to the United States, carrying and brandishing a firearm during a robbery, and being a felon in possession of a firearm.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Assistant Director in Charge Paul M. Abbate of the Federal Bureau of Investigation - Washington Field Office; Postal Inspector in Charge Maria L. Kelokates of the U.S. Postal Inspection Service - Washington Division; Chief Henry P. Stawinski of the Prince George’s County Police Department and Chief Douglas Holland of the Hyattsville Police Department.
“Today’s sentencing is the result of the U.S. Postal Inspection Service working diligently with our law enforcement partners to make sure that U.S. Postal Service customers, employees and facilities are protected,” stated Postal Inspector in Charge Maria L. Kelokates of the U.S. Postal Inspection Service - Washington Division.
According to his plea agreement, on August 8, 2013, Davis and co-conspirator Recardo Beatty drove to the Hyattsville Post Office. Beatty first entered the post office to scout the inside. Davis then entered, while Beatty waited outside in their getaway vehicle. Davis pointed a long black paintball gun at an employee. The employee and another employee fled from their cash registers, while Davis grabbed money and money orders out of the register. Davis and Beatty fled in their vehicle.
On August 15, 2013, the pair traveled to the Glut Food Co-Op in Mt. Rainer, Maryland. As Beatty waited outside in the vehicle, Davis entered the store, walked behind a counter where an employee was working and displayed a paintball gun. Davis ordered the employee to open the cash register and Davis removed money. Davis and Beatty fled in their vehicle.
On September 17, 2013, Davis and Beatty traveled to the Dollars and Sense store in Brentwood, Maryland and entered the store together. Davis demanded that an employee open a cash register, from which he took money and a cash box. Beatty, who was armed with a firearm, saw another employee approach a store exit door. A fight ensued, and the employee was hit on the head. Davis and Beatty fled the store in their vehicle.
On the same day as the Dollars and Sense robbery, officers recovered the firearm from Beatty that was used in the robbery. The next day, September 18, 2013, officers executed a search warrant at Beatty’s residence where Davis was staying, and recovered a paintball gun and clothing used in the robberies.
Davis had previously been convicted of a felony and was thus prohibited from possessing a firearm.
Recardo Beatty, age 50, of Washington, D.C., previously pleaded guilty to his participation in the robberies and is scheduled to be sentenced on February 29, 2016 at 9:00 a.m.
United States Attorney Rod J. Rosenstein commended the FBI, U.S. Postal Inspection Service and the Prince George’s County and Hyattsville Police Departments for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorney Leah Jo Bressack and Special Assistant United States Attorney Matthew L. Paeffgen, who prosecuted the case.
California Man Sentenced for Human Trafficking and Methamphetamine in the BakkenRead the Press Release
FARGO - U. S. Attorney Christopher C. Myers announced that on Feb. 17, 2016, Keith Alexander Graves, 39, Los Angeles, Calif., was sentenced before U. S. District Judge Daniel L. Hovland to serve 33 years and nine months in prison following an eight-day jury trial. Graves was found guilty of five (5) counts of Sex Trafficking by Force or Coercion and one count each of Distribution and Possession of Methamphetamine. Judge Hovland also ordered that Graves be placed on lifetime supervised release, as well as pay a $625 special assessment to the Crime Victims’ Fund.
On or about July 29, 2014, the Williston Police Department received a call requesting assistance from a female victim near the Walmart located in Williston, ND. The victim was scared and concerned that the individual she was reporting to law enforcement would see her and stated that she was involuntarily involved in prostitution and drugs under the control of Graves. Throughout witness testimony during trial, several victim witnesses described being sexually assaulted and/or raped by Graves, as well as being forced into ingesting methamphetamine. Graves also used force or the threat of force in coercing the victims to engage in prostitution.
In July 2014 a search warrant was executed on a motel room related to the case, where several items were found, including: an aluminum bat, marijuana, methamphetamine, pills, as well as several other items located in a nearby vehicle. A BB gun was located where he was residing.
This case was investigated by the Federal Bureau of Investigation, North Dakota BCI, and the Williston Police Department.
Assistant U. S. Attorneys Brandi Russell and Gary Delorme prosecuted the case.
California Man Pleads to Heroin PossessionRead the Press Release
On February 10, 2016, Conrad Valdez, Jr., 45, of Selma, California, pled guilty to a one-count indictment charging possession with intent to distribute more than one kilogram of heroin, the Acting United States Attorney for the Southern District of Illinois, James L. Porter, announced today.
Evidence at the plea hearing established that Valdez was involved with others in the distribution of heroin. During a September 27, 2016, traffic stop in Effingham County, officers located approximately 20 kilograms of heroin in Valdez’s truck. Valdez is currently being held without bond pending a June 8, 2016, sentencing hearing.
The heroin offense carries a penalty of 10 years’ to life imprisonment, to be followed by at least 5 years’ supervised release, and a fine of up to $10,000,000.
The ongoing investigation is being conducted by the Drug Enforcement Administration, Central Illinois Enforcement Group and Illinois State Police. The Effingham County State’s Attorney’s Office assisted in the investigation.
The case is assigned to Assistant United States Attorney Amanda A. Robertson for prosecution.
Buffalo Man Sentenced for Food Stamp FraudRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
BUFFALO, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that Ahmed Hassan, 67, of Buffalo, NY, who was convicted of food stamp fraud, was sentenced to two years probation including eight months home detention and ordered to pay restitution totaling $68,177 by Chief U.S. District Judge Frank P. Geraci.
Assistant U.S. Attorney Marie P. Grisanti, who handled the case, stated that the defendant operated the Ferry Community Market on E. Ferry Street in Buffalo. Between June 1, 2012 and August 31, 2012, Hassan directed and authorized employees to purchase food stamp benefits for less than their full value for cash from eligible beneficiaries. By swiping the food stamp cards through the electronic funds transfer terminal installed at Ferry Community Market, employees engaged in approximately $68,177 of illegitimate transactions for the time period in question.
The sentencing was the result of an investigation by Special Agents of the U.S. Department of Agriculture, Office of Inspector General, under the direction of William G. Squires Jr., Special Agent in Charge, Northeast Region.
Buffalo Man Pleads Guilty to Distributing FentanylRead 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 Alexander Snow, 33, of Buffalo, NY, pleaded guilty before Chief U.S. District Judge Frank P. Geraci, Jr. to distribution of fentanyl. The charge carries a maximum penalty of 20 years in prison and a fine of $1,000,000.
Assistant U.S. Attorney Caleb J. Petzoldt, who is handling the case, stated that between December 2014 and January 2015, the defendant distributed fentanyl in the city of Buffalo which included six undercover controlled purchases by the Drug Enforcement Administration.
The plea is the culmination of an investigation by the Drug Enforcement Administration, under the direction of Special Agent in Charge James J. Hunt, New York Field Division.
Sentencing is scheduled for May 19, 2016 at 11:00 a.m. before Judge Geraci.
Brooke County, WV man charged with failure to update sex offender registrationRead the Press Release
ELKINS, WEST VIRGINIA – A federal grand jury returned an indictment today charging convicted sex offender Christopher Barker, 27, of Follansbee, West Virginia, with moving across state lines without updating his sex offender registration status, United States Attorney William J. Ihlenfeld, II, announced.
Barker, also known as Christopher D. Cooper, was previously convicted in Ohio County, West Virginia of “First Degree Sexual Assault Involving a Minor.” As a result of that conviction, Barker is required to register as a sex offender. Barker is alleged to have moved from Pittsburgh, Pennsylvania to Follansbee, West Virginia in late 2015 without updating his sex offender registration status.
Barker is charged with one count of “Failure to Register and Update Registration as a Sex Offender.” He faces up to 10 years in prison and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Stephen Vogrin is prosecuting the case on behalf of the government. The United States Marshals Service, the Pennsylvania State Police, and the Pittsburgh, Pennsylvania Police Department are investigating.
An indictment is merely an accusation. A defendant is presumed innocent unless and until proven guilty.
Bismarck Man Sentenced for Tax FraudRead the Press Release
BISMARCK - U. S. Attorney Christopher C. Myers announced that on February 16, 2016, Solomon Lindsay, 39, Bismarck, N.D., was sentenced before U. S. District Court Judge Daniel L. Hovland to time served plus three years’ supervised release on three counts of Tax Fraud. Judge Hovland also ordered Lindsay to pay $300 to the Crime Victims’ Fund, as well as restitution to the IRS.
An IRS investigation revealed that for the tax years 2009 through 2012, Lindsay, who has a Bachelor’s Degree in Accounting from UND, ran a tax service out of his apartment. Lindsay created a scheme whereby he would file returns on behalf of others, mainly family and friends, which would include inflated income figures and false credits. Each return then requested a false refund. Lindsay electronically filed the returns and deposited all the refunds in his personal account. Each taxpayer received a smaller refund than requested, while Lindsay skimmed a substantial amount of the money for himself. The scam resulted in the IRS paying out fraudulent refunds totaling $140,741.00.
The U. S. Attorney’s Office is committed to the enforcement of all federal tax violations, from refund scams to tax evasion schemes, and will continue to aggressively prosecute this category of federal crimes.
This case was investigated by the Internal Revenue Service.
Assistant U. S. Attorney Cameron Hayden prosecuted the case.
Billings Hospital One of 51 Hospitals Nationwide to Pay More Than $23 Million to Resolve False Claims Act Allegations Related to Implantation of Cardiac DevicesRead the Press Release
WASHINGTON – The Department of Justice announced today that it has reached settlements with 51 hospitals in 15 states for more than $23 million related to cardiac devices that were implanted in Medicare patients in violation of Medicare coverage requirements. Saint Vincent Healthcare in Billings is one of the hospitals included in the settlements. St. Vincent is part of the Sisters of Charity of Leavenworth Health System, based in Broomfield, CO, and is one of five Sisters of Charity hospitals that together paid 1.95 million under the settlements.
An implantable cardioverter defibrillator, or ICD, is an electronic device that is implanted near and connected to the heart. It detects and life-threatening heart rhythms, called fibrillations, by delivering a shock to the heart, restoring the heart’s normal rhythm. Only patients with certain clinical characteristics and risk factors qualify for an ICD covered by Medicare.
Medicare coverage for the device, which costs approximately $25,000, is governed by a National Coverage Determination (NCD). The Centers for Medicare and Medicaid Services implemented the NCD based on clinical trials and the guidance and testimony of cardiologists and other health care providers, professional cardiology societies, cardiac device manufacturers and patient advocates. The NCD provides that ICDs generally should not be implanted in patients who have recently suffered a heart attack or recently had heart bypass surgery or angioplasty. The medical purpose of a waiting period - 40 days for a heart attack and 90 days for bypass/angioplasty - is to give the heart an opportunity to improve function on its own to the point that an ICD may not be necessary. The NCD expressly prohibits implantation of ICDs during these waiting periods, with certain exceptions. The Department of Justice alleged that from 2003 to 2010, each of the settling hospitals implanted ICDs during the periods prohibited by the NCD.
The settlements announced today follow similar agreements announced in October of 2015 in which the Department settled with 457 hospitals for more than $250 million. The settlements announced today represent the final stage of a nationwide investigation into the practices of hundreds of hospitals improperly billing Medicare for these devices. The case underlying the settlements was brought as a qui tam, or whistleblower, lawsuit under the False Claims Act. The investigation was part of the government’s Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which is a collaborative effort between DOJ and the Department of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. Since January 2009, the Justice Department has recovered a total of 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. With these additional agreements, the Justice Department’s investigation has now yielded settlements with more than 500 hospitals totaling more than $280 million.
The settlements were the result of a coordinated effort among the DOJ’s Civil Division Commercial Litigation Branch, the U.S. Attorney’s Office of the Southern District of Florida and HHS-OIG’s Office of Investigations and Office of Counsel to the Inspector General. More information on the settlements announced today can be found at the DOJ’s Office of Public Affairs Website.
The claims resolved by these settlements are allegations only and there has been no determination of liability.
This lawsuit is captioned U.S. ex rel. Ford et al. v. Abbott Northwestern et al. No. 08-cv-20071 (S.D. Fla.)
Berlin Man Sentenced for Marijuana Trafficking, Money Laundering and Tax EvasionRead the Press Release
BOSTON - A Berlin man was sentenced today in federal court for conspiring to distribute more than 100 kilograms of marijuana, money laundering and tax evasion.
Eric W. Sliwa, age 35, was sentenced by U.S. District Judge Timothy S. Hillman to 78 months in prison to be followed by four years of supervised release. On October 7, 2015, Sliwa pleaded guilty to a 34-count indictment.
The defendant and others distributed large quantities of marijuana between 2001 and 2012. In June 2006, the defendant set up a company, EWS Gem Corp., for the purpose of concealing his drug proceeds and making it appear as though he had legitimate income. While the defendant filed personal tax returns for the tax years 2008 through 2010, he failed to report all of the proceeds from his drug trafficking business. During the time period of the conspiracy, the defendant lived a lavish lifestyle and purchased several assets including his home in Berlin, Mass., a condominium in Killington, Vt. and multiple luxury vehicles. At the time of his arrest, Sliwa possessed nearly $500,000 in cash as well as a coin and precious metal collection worth approximately $370,000 in a safe deposit box. As part of his plea agreement, Sliwa agreed to forfeit over $1,000,000 in cash, gold coins and luxury vehicles.
United States Attorney Carmen M. Ortiz; Michael J. Ferguson, Special Agent in Charge of the Drug Enforcement Administration, New England Field Division; and Manny J. Muriel, Acting Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston, made the announcement today. The case was prosecuted by Assistant U.S. Attorney Cory Flashner of Ortiz’s Worcester Branch Office.
Bank Robber Sentenced to 151 Months in Federal PrisonRead the Press Release
DALLAS — A Dallas man, Shaun Wesley Skinner, 27, was sentenced yesterday by U.S. District Judge Sam A. Lindsay to 151 months in federal prison following his guilty plea in May 2015 to one count of bank robbery and one count of attempted bank robbery. The announcement was made today by U.S. Attorney John Parker of the Northern District of Texas.
According to documents filed in the case, on November 18, 2014, Skinner entered the Wells Fargo Bank, located at 2222 McKinney Avenue in Dallas, where he handed a teller a note that demanded money. The teller, however, did not give Skinner any money, and he fled the bank on foot.
On December 29, 2014, Skinner entered the Chase Bank, located at 10321 Lake June Road in Dallas, approached the teller, and verbally ordered and intimidated the teller into giving him money. Skinner then fled the bank with the money.
The Federal Bureau of Investigation and the Dallas Police Department investigated. Assistant U.S. Attorney Keith Robinson prosecuted the case.
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Bank Manager Sentenced for Staging Bank Robbery and Falsifying Bank DocumentsRead the Press Release
James L. Porter, Acting United States Attorney for the Southern District of Illinois, announced today that Matthew S. Liebheit, 40, Moro, IL, was sentenced in federal court to 41 months in federal prison, to be followed by 4 years of supervised release on two counts of Theft, Embezzlement, or Misapplication by a Bank Officer or Employee and one count False Bank Entries. Liebheit was also ordered to pay $140,862 in restitution and a $300 Special Assessment.
The charges stem from a purported bank robbery at Liberty Bank in Bethalto, Illinois on December 13, 2014. Liebheit, a bank manager at Liberty Bank, called police to report a bank robbery, indicating that a masked individual forced him into the bank at gun point prior to the bank opening. He gave a description of the suspect’s vehicle and stated that he was forced to give that individual over $280,000 from the bank’s vault.
Further investigation revealed that Liebheit’s truck was used as a getaway vehicle and Liebheit was involved in the planning of the staged bank robbery. The "robber" was identified as Eugene Babcock, who Liebheit recruited to do the "robbery," and who used a BB gun to make the robbery appear authentic. Additional investigation showed that Liebheit had also altered withdrawal documents from a Liberty Bank customer’s account to reflect a larger than intended withdrawal from that customer’s account. The day before the staged robbery, Liebheit falsified documentation to show a substantial deposit to that customer’s account.
Babcock has pled guilty to his role in the staged robbery and is scheduled to be sentenced on March 30, 2016.
The case was investigated by the Federal Bureau of Investigation and the Bethalto Police Department. The case is assigned to Assistant United States Attorneys Laura Reppert and Jonathan Drucker.
Atlantic Beach Woman Indicted on Federal Charge of Failure to Register as A Sex OffenderRead the Press Release
Jacksonville, Florida – United States Attorney A. Lee Bentley, III announced today that Sunshine Marie McEwen (41, Atlantic Beach) has been indicted by a federal grand jury and charged with failing to register as a sex offender after traveling from Florida to California. If convicted, she faces up to 10 years in federal prison. McEwen was arrested in Palm Springs, California on November 28, 2015, and is currently in state custody in Jacksonville.
According to the indictment, on or about August 20, 1998, McEwen was convicted of two counts of lewd and lascivious act (sexual battery) in Jacksonville, Florida. Subsequent to her conviction, and between May 15, 2015, and November 28, 2015, she traveled from Florida to California and failed to register as a sex offender, as required by the Sex Offender Registration and Notification Act.
The Sex Offender Registration and Notification Act is part of the Adam Walsh Child Protection and Safety Act of 2006. The Adam Walsh Act provides for the use of federal law enforcement resources, including the United States Marshals Service, to assist state and local authorities in locating and apprehending non-compliant sex offenders. This case was investigated by the United States Marshals Service, the Jacksonville Sheriff’s Office, the Florida Department of Law Enforcement, and the Palm Springs (California) Police Department. It is being prosecuted by Assistant United States Attorney D. Rodney Brown.
An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent until, and unless, proven guilty.
This another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Atkins, Va. Man Sentenced on Methamphetamine ChargesRead the Press Release
ABINGDON, VIRGINIA – United States Attorney John P. Fishwick Jr. announced today the sentencing of a man who previously pled guilty to charges related to the manufacturing and distribution of methamphetamine.
Stanley Martin Frye, 40, of Atkins, Va., pled guilty in March 2015 to one count of manufacturing, distributing and possessing with the intent to distribute methamphetamine. Today in the United States District Court for the Western District of Virginia in Abingdon, Frye was sentenced to 24 months of federal incarceration to be followed by three years of supervised release.
“We must continue to fight the scourge of drug abuse and addiction in the Western District of Virginia,” United States Attorney John P. Fishwick Jr. said today. “It is the mission of the United States Attorney’s Office to prosecute those who distribute these dangerous substances and provide support to those groups that help treat the drug addicted in our communities.”
The investigation of the case was conducted by The investigation of the case was conducted by the Washington County Sheriff’s Office, Russell County Sheriff’s Office, Tazewell County Sheriff’s Office, Smyth County Sheriff’s Office, Bristol, Virginia Sheriff’s Office, Abingdon Police Department, Bristol, Virginia Police Department, Virginia State Police, United States Marshals Service, Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Drug Enforcement Administration. Special Assistant United States Attorney Kevin Jayne prosecuted the case for the United States.
Artesia Woman Pleads Guilty to Federal Money Laundering ChargeRead the Press Release
ALBUQUERQUE – Jerilyn Munoz, 28, of Artesia, N.M., pleaded guilty this afternoon in federal court in Las Cruces, N.M., to a money laundering conspiracy charge under a plea agreement with the U.S. Attorney’s Office.
Munoz was one of 34 individuals charged with federal and tribal drug offenses as the result of an 18-month multi-agency investigation led by the DEA and BIA into methamphetamine trafficking on the Mescalero Apache Reservation. Eighteen defendants, including five members of the Mescalero Apache Tribe and 13 non-Natives were charged in six federal indictments and a federal criminal complaint. Sixteen other members of the Mescalero Apache Tribe were charged in tribal criminal complaints approved by the Mescalero Apache Tribal Court.
The investigation leading to the federal and tribal charges was initiated in May 2014, in response to an increase in violent crime on the Mescalero Apache Reservation perpetrated by methamphetamine users. The investigation initially targeted a drug trafficking organization that was allegedly distributing methamphetamine within the Reservation, and later expanded to include two other drug trafficking organizations in southeastern New Mexico that allegedly served as sources of supply for the methamphetamine distributed within the Reservation. In Aug. 2014, the investigation was designated as part of the Justice Department’s Organized Crime Drug Enforcement Task Force (OCDETF) program, which combines the resources and unique expertise of federal agencies, along with their local counterparts, in a coordinated effort to disrupt and dismantle major drug trafficking organizations. The investigation is one of the first OCDETF investigations to utilize electronic surveillance (wiretaps) in Indian Country. More than ten kilograms of methamphetamine were seized during the course of the investigation.
Munoz was arrested on Nov. 20, 2015, on an indictment charging her and seven other non-Natives with methamphetamine trafficking and money laundering offenses. The indictment charged Munoz with participation in a methamphetamine trafficking conspiracy, participation in a money laundering conspiracy, and using a communications device, a telephone, to facilitate a drug trafficking crime.
During today’s change of plea hearing, Munoz pled guilty to the money laundering conspiracy charge. In entering the guilty plea, Munoz admitted that between April 2015 and Oct. 2015, she maintained a bank account that was used by another person to deposit the proceeds of drug trafficking crimes in order to conceal the proceeds. Munoz admitted that the other person deposited approximately $25,000.00 into her bank account during that period.
At sentencing, Munoz faces a statutory maximum penalty of 20 years in prison followed by not more than three years of supervised release. Her sentencing hearing has yet to be scheduled.
Munoz is the second of the 18 federal defendants to enter a guilty plea. Wallace Rice, 23, an enrolled member of the Mescalero Apache Nation who resides in Mescalero, N.M., pled guilty to a methamphetamine distribution charge on Feb. 5, 2016. At sentencing, Rice faces a statutory maximum penalty of 20 years in federal prison followed by not less than three years of supervised release.
The federal and tribal cases were investigated by the Las Cruces office of the DEA, District IV of the BIA’s Office of Justice Services (Mescalero Agency), BIA’s Division of Drug Enforcement, Mescalero Tribal Police Department, Hatch Police Department, FBI and Lea County Drug Task Force. Assistant U.S. Attorney Terri J. Abernathy of the U.S. Attorney’s Las Cruces Branch Office is prosecuting the federal cases, and Mescalero Tribal Prosecutor Alta Braham is prosecuting the tribal cases.
Armed career offender sentenced to more than 20 years in prison on firearms and drug chargesRead the Press Release
SHREVEPORT, La. – United States Attorney Stephanie A. Finley announced that a Shreveport man was sentenced Tuesday to 248 months in prison as an Armed Career Offender for firearms and drug charges.
Jeffery Lynn Alexander, 44, of Shreveport, was sentenced by U.S. District Judge S. Maurice Hicks Jr. on two counts of felon in possession of a firearm, one count of possession with intent to distribute cocaine and one count of carrying a firearm in relation to a drug trafficking offense. He was also sentenced to serve five years of supervised release. According to the September 14, 2015 guilty plea, law enforcement agents conducted a controlled sale of cocaine at a Shreveport hotel in October of 2014. Alexander was recorded participating in the purchase of approximately 8 ounces of cocaine, while armed with a loaded Smith & Wesson .40 caliber handgun. While executing a warrant at Alexander’s home on April 15, 2015, law enforcement agents found Alexander in possession of a loaded 9 mm pistol, cocaine, methamphetamine and cash. Alexander has a prior conviction for possession of cocaine in 2003 and multiple felony drug trafficking convictions in 1998, 2005 and 2010. He was sentenced as an Armed Career Offender. The mandatory minimum sentence for an Armed Career Offender is 15 years in prison.
To be found an Armed Career Offender under federal law, a defendant must have three previous convictions that are either a violent felony or a serious drug offense, or both, committed on occasions different from one another. A serious drug offense can be an offense under federal or state law if it involves the manufacturing, distributing or possessing with intent to manufacture or distribute a controlled substance for which a maximum term of 10 years or more in prison is prescribed by law.
“This defendant had multiple felony convictions and was prohibited by law from possessing a firearm; yet, he not only continued to possess firearms, but also continued to engage in illegal drug offenses,” Finley stated. “The safety and security of the community is our highest priority.”
This case is part of Project Safe Neighborhoods, which is a Department of Justice initiative designed to reduce firearm crimes by removing dangerous and persistent felons from the community and promote firearm safety.
The ATF, Shreveport Police Department and Caddo-Shreveport Narcotics Task Force conducted the investigation. Assistant U.S. Attorney Robert W. Gillespie Jr. prosecuted the case.
Alton Woman Indicted for Government Benefits FraudRead the Press Release
Ebony J. Smith, 37, of Alton, Illinois, was indicted by a federal grand jury on January 20, 2016, on two counts of Theft of Government Funds and two counts of False Statement, the Acting United States Attorney for the Southern District of Illinois, James L. Porter, announced today. Smith was arraigned on the charges this week. If convicted of Theft of Government Funds, Smith faces a maximum penalty of ten years in prison, a $250,000 fine, and three years of supervised release as to each count. If convicted of False Statement, Smith faces a maximum penalty of five years in prison, a $250,000 fine, and three years of supervised release as to each count.
The indictment alleges that from around November 2001, continuing to around November 2011, Smith willfully and knowingly did steal, purloin, and convert for her own use money belonging to the U.S. Department of Housing and Urban Development, having a value of approximately $88,000, by obtaining HUD Housing Choice Voucher Program rent subsidies for a home in which she had an ownership interest when she knew she was not entitled to the rent subsidies due to her ownership interest in the property. The indictment further alleges that from November 2001, continuing to around November 2011, Smith willfully and knowingly did steal, purloin, and convert to her own use money of the Social Security Administration, having a value of approximately $72,000, by obtaining supplemental social security income while also receiving unreported assistance from the HUD Housing Choice Voucher Program. Smith is also alleged to have made materially false statements to the U.S. Department of Housing and Urban Development and the Social Security Administration in the HUD "Tenant Annual Renewal Personal Declaration" and the SSA "Redetermination Summary for Determining Continuing Eligibility for Supplemental Security Income Payments" forms when she did not disclose her ownership interest in the real estate for which she was receiving the rent subsidies and she did not disclose to the SSA the rent assistance she was receiving through the HUD Housing Choice Voucher Program.
An indictment is a formal charge against a defendant. Under the law, a defendant is presumed to be innocent of a charge and is entitled to a fair trial at which the United States must prove guilt beyond a reasonable doubt.
The case was investigated by the U.S. Department of Housing and Urban Development, Office of Inspector General and the U.S. Social Security Administration, Office of Inspector General, Office of Investigations. The case is being prosecuted by Assistant U.S. Attorney Ali Summers.
Additional Federal Charges Brought in Nationwide Identity Theft and IRS Tax Refund SchemeRead the Press Release
MEDFORD, Ore. - Federal law enforcement agents arrested Michael Oluwasegun Kazeem, 22, in Georgia based on an Oregon federal grand jury indictment unsealed today. Kazeem, a resident of both Nigeria and Atlanta, Georgia, is charged with mail fraud, aggravated identity theft and conspiring to commit mail fraud with his brother, Emmanuel Oluwatosin Kazeem, 32, of Bowie, Maryland, and Oluwamuyiwa Abolad Olawoye, 29, of Marietta, Georgia.
Michael Kazeem made an initial appearance in Georgia and will be arraigned in the District of Oregon at a date to be set by the Court.
The indictment alleges that, beginning at least as early as tax year 2012, Michael Kazeem, along with his brother and Olawoye and others, engaged in an identity theft conspiracy, in Oregon and elsewhere, involving a scheme to obtain millions of dollars in fraudulent tax refunds from the Internal Revenue Service. The allegations of the indictment detail how Michael Kazeem and his co-conspirators carried out a complex fraudulent scheme involving the use of stolen personal identifying information (PII), falsified wage and withholding information, fraudulently generated electronic filing PINs, disposable email addresses to conceal the co-conspirators’ identities, and the receipt of fraudulent tax refunds through prepaid debit cards. In addition, it describes for the first time allegations brought involving the unauthorized access into the IRS system to obtain taxpayer transcript information. Specifically, Michael Kazeem and his co-conspirators used stolen PII for unauthorized online access to obtain over 1,200 taxpayer transcripts through the IRS “Get Transcript” application process, which was discontinued by the IRS in May 2015. Both Emmanuel Kazeem and Olawoye were previously charged in the District of Oregon, along with Lateef Aina Animawun, 35, Oluwatobi Rueben Dehinbo, 30, and Oluwaseunara Temitope Osanyinbi, 35, with obtaining stolen personal identifying information of taxpayers and submitting false federal tax returns.
“Pursuing those involved in identity theft remains one of our highest priorities,” said U.S. Attorney Billy J. Williams. “Oregonians, as well as others, have been continually victimized by those who unlawfully obtain personal identifying information. It is used to commit fraud, including tax refund fraud, inflicting chaos in the lives of innocent taxpayers long afterward. The U.S. Attorney’s office will continue to pursue those involved in this type of illegal activity and they will be held fully accountable.”
In total, Michael Kazeem and his co-conspirators are alleged to have unlawfully obtained the PII of over 250,000 taxpayers and filed over 2,900 false federal tax returns seeking over $25 million in fraudulent refunds. Although the IRS rejected millions of dollars of fraudulently claimed refunds, the indictment alleges that the defendants successfully obtained $4.7 million in illegal refunds.
“The Federal Trade Commission reported recently that Oregon jumped to third in the nation for reported incidences of identity theft. We know that tax refund fraud cases are a major contributor of the increase of reported identity theft,” stated Special Agent in Charge Teri Alexander of IRS Criminal Investigation. “The arrest of Michael Kazeem is a firm indication of the determined efforts of IRS CI and the U.S. Attorney’s Office to reverse that trend here in Oregon and to provide some relief to the victims of this incredibly invasive crime.”
The indictment, which may be viewed here, charges Michael Kazeem with one count of conspiracy to commit mail fraud, seven counts of mail fraud and seven counts of aggravated identity theft. The fraud and conspiracy charges are each punishable by up to 30 years in federal prison and a fine of up to $1 million. If convicted of the aggravated identity theft charges, there is a mandatory minimum penalty of two years in federal prison for each count of conviction. An indictment is only an allegation of a crime and a defendant is presumed innocent until proven guilty beyond a reasonable doubt.
This case results from a joint investigation by IRS-Criminal Investigation, the U.S. Department of Health and Human Services, Office of Inspector General, and the Federal Bureau of Investigation, with support provided by the Department of Treasury, Inspector General for Tax Administration, the United States Postal Inspection Service, the U.S. State Department, Homeland Security Investigations, Medford, Oregon, U.S. Citizenship Immigration Services, Atlanta, Georgia and the Atlanta Police Department. This case is being prosecuted by District of Oregon Assistant U.S. Attorneys Byron Chatfield and Nancy Olson.
Taxpayers are reminded to be vigilant in the protection of their personal identifying information. Anyone interested in more information on preventing or reporting suspected identity theft should review the Internal Revenue Service’s website at http://www.irs.gov/uac/Taxpayer-Guide-to-Identity-Theft.
Adam Chartier Arrested for Bomb Threat Called into the United States Post Office in Burlington, VermontRead the Press Release
The Office of the United States Attorney for the District of Vermont stated that Adam Chartier, 29 years old, of Puerto Rico, was arrested by the Federal Bureau of Investigation (FBI) on February 11, 2016 in Puerto Rico on federal charges that he used a telephone, or other instrument of interstate commerce, to make a threat concerning the destruction or damage to a building by means of explosive, in violation of 18 U.S.C. § 844(e). Chartier made an initial appearance on that same day before a U.S. Magistrate Judge in Puerto Rico and was ordered detained.
According to court documents, on February 5, 2016, at approximately 9:30 a.m., Chartier called the FBI office in Vermont and made statements about calling in a bomb threat to the post office. Approximately one half hour later, someone called the United States Post Office on Elmwood Avenue in Burlington and indicated that there was a bomb in the building. The building was evacuated and searched, but no bomb was found. Agents with the FBI and Federal Protective Service later spoke with Chartier who admitted he had just called in a bomb threat to the post office in Burlington. On February 8, 2016, a federal arrest warrant was issued for Chartier, and he was arrested February 11, 2016.
The United States Attorney, Eric S. Miller, emphasized that the charge against Chartier is merely an accusation and that the defendant is presumed innocent unless and until he is proven guilty.
If convicted, the defendant faces up to ten years of imprisonment and a fine of up to $250,000. The actual sentence would be determined with reference to federal sentencing guidelines.
This case was investigated by the FBI, the Federal Protective Service and the Vermont State Police. The prosecutor is Assistant U.S. Attorney Wendy G. Fuller.
Tuesday 16 February 2016
Wood Village Resident Sentenced to More Than 10 Years in Federal PrisonRead the Press Release
PORTLAND, Ore. – Guadalupe Ortiz Carrillo, 33, a resident of Wood Village, Oregon, was sentenced by U.S. District Judge Marco A. Hernandez to 125 months in prison following his federal conviction for engaging in a conspiracy to distribute and possess methamphetamine and heroin. When the defendant is released from prison, he is required to serve three years of supervised release.
On July 17, 2014, the defendant was arrested after he arranged to have a runner deliver four pounds of methamphetamine to an undercover police officer. The investigation revealed that the runner had been working for the defendant for a year and a half and was paid $500 a week to store and deliver methamphetamine and heroin at the behest of the defendant. Officers subsequently searched the residences of the defendant and the runner and found an additional six pounds of methamphetamine, over three-quarters of a pound of heroin, $10,524 in cash, scales, and drug packaging materials.
On July 7, 2015, the defendant pled guilty to engaging in a conspiracy to distribute and possess with the intent to distribute methamphetamine and heroin.
“Methamphetamine and heroin have been identified as two of the region’s most serious drug threats,” stated U.S. Attorney Billy J. Williams. “This case is another example of our continued dedication to work with our federal and local law enforcement partners to hold significant drug dealers accountable for poisoning our community.”
According to the Oregon High Intensity Drug Trafficking Area (HIDTA) Program:
Methamphetamine in the form of crystal methamphetamine, or “ice,” continues to be readily available and widely used throughout the Oregon HIDTA and represents the region’s most serious drug threat. Methamphetamine is a highly addictive central nervous system stimulant that is abused for its euphoric and stimulant effects. Chronic methamphetamine abusers exhibit violent behavior, confusion, insomnia and psychotic characteristics such as hallucinations and paranoia. Methamphetamine-related crime, such as identity theft, abused and neglected children, and other serious person and property crimes, continues to occur at a palpable rate and is prevalent throughout the HIDTA region.
Oregon and Idaho law enforcement officers surveyed in 2015 indicated methamphetamine remains a significant threat due to its level of use and availability; nexus to other crimes such as violent activity and property crime; societal impact; and connection to drug trafficking organizations, primarily MNDTOs [multi-national drug trafficking organizations]. Of law enforcement agencies surveyed, 62 percent reported methamphetamine as the greatest Oregon HIDTA Program drug threat to their area, with the majority indicating methamphetamine as the drug that contributes most to violent crime (88%) and property crime (69%). Furthermore, over 60 percent of officers ranked methamphetamine as the drug that serves as the primary funding source for major criminal activity.
Threat Assessment and Counter-Drug Strategy, Program Year 2016, Oregon HIDTA Program, at 12-13 (June 2015).
Heroin availability has increased in the Oregon HIDTA region since 2007, fueling a rise in the volume of heroin seized, number of new users and associated overdoses. Evaluation of recent indicators suggests that heroin availability and use has reached a critical level and represents a close second to methamphetamine as the region’s most serious drug threat.
Id. at 20.
This case was investigated by the Department of Homeland Security Investigations and the Portland Police Bureau’s Drugs and Vice Division. The case was prosecuted by Assistant United States Attorney Scott Kerin.
Westbrook Man Sentenced to Six Years for Distributing Bath Salts and Violating Release ConditionsRead the Press Release
Contact: David B. Joyce
Assistant United States Attorney
Tel: (207) 280-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced that Christopher Coombs, 44, of Westbrook, Maine, was sentenced today in U.S. District Court by Judge George Z. Singal to five years in prison for possessing with intent to distribute alpha-PHP (a bath salt) and obstruction of justice and a consecutive one year in prison for Coombs’s violation of the terms of supervised release imposed on him in connection with a 2009 drug trafficking conviction. Coombs pled guilty on November 10, 2015.
According to court records, on October 31, 2014, law enforcement officers conducted a controlled delivery of about 500 grams of alpha-PHP to Coombs at his residence in Westbrook. This package was sent from China and was intercepted by customs officials in New York. After Coombs accepted the package, he was arrested. Following his arrest, he directed his wife to delete certain emails that were relevant to the investigation.
This case was investigated by U.S. Immigration & Customs Enforcement’s Homeland Security Investigations, the Westbrook Police Department, and the U.S. Postal Inspection Service.
Washington County Man Charged with Distributing Heroin and Fentanyl that Caused Two OverdosesRead the Press Release
PITTSBURGH – Ronald McMillian, of Washington, Pennsylvania has been indicted by a federal grand jury in Pittsburgh on charges of trafficking in heroin and fentanyl, which resulted in serious bodily injury, United States Attorney David J. Hickton announced today.
The four-count indictment, returned on Feb. 9, charged McMillian with conspiring to distribute and distributing heroin and fentanyl, which resulted in serious bodily injury to at least two people, in August, 2015.
The law provides for a maximum total sentence of not less than twenty years, and up to life in prison, a fine of up to $1,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorneys Ross E. Lenhardt and Katherine A. King, of the violent crime section of the U.S. Attorney’s Office, are prosecuting this case on behalf of the government.
Special Agents and Task Force Officers from the Drug Enforcement Administration, the Washington County Drug Task Force, the Pennsylvania Office of the Attorney General, the Pennsylvania State Police, the Washington County District Attorney’s Office, and numerous local police departments including the Canonsburg Police Department, the Donora Police Department, the Monessen Police Department, and the Charleroi Police Department, as well as the Washington County Coroner’s Office, and the Allegheny County Medical Examiner’s Office, 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.
Vinton Woman Charged with Providing a Firearm to an Unlawful User of MarijuanaRead the Press Release
Robyn Lynn Merchant, a/k/a Robyn Lynn Winterroth, 52, from Vinton, Iowa, has been charged with one count of providing a firearm to a prohibited person. The charges are contained in a Complaint unsealed today in United States District Court in Cedar Rapids.
The Complaint alleges that, on or about February 23, 2015, Merchant provided a Walther HK MP5 22LR semiautomatic rifle to her son, D.W., a minor child. The Complaint further alleges that at the time Merchant provided D.W. the semiautomatic rifle, Merchant knew or had reasonable cause to believe that D.W. was an unlawful user of marijuana.
Allegations in the Complaint provide that on February 24, 2015, at approximately 6:19 p.m., police responded to the residence of Merchant in Vinton, Iowa, after receiving a 911 call that a shooting had taken place. When police arrived, they discovered that a 14 year old girl, E.R., had been shot in an upstairs bedroom. That bedroom belonged to D.W., Merchant’s 16 year old son. D.W. was present in his bedroom at the time of the shooting. Also present in the bedroom were J.H. and W.H., both 16 year old males.
The Complaint further alleges that the investigation revealed that at the time of the shooting, D.W. was an unlawful user of marijuana. Several associates of D.W.’s admitted to observing D.W. use marijuana in D.W.’s bedroom at some time during 2014 and 2015, prior to the shooting incident. A urine sample obtained on February 24, 2015, from D.W. tested positive for the presence of marijuana. During a subsequent interview, D.W. admitted to first smoking marijuana at the age of 14, and becoming a regular marijuana user at age 15.
Allegations in the Complaint also state that when Merchant provided the firearm to D.W. on or about February 23, 2015, she knew and had reasonable cause to believe, that D.W. was then an unlawful user of marijuana. Specifically, the Complaint alleges that on the night of the shooting, police observed indicators of drug and alcohol use in plain view in D.W.’s bedroom. That night, from D.W.’s bedroom police seized a marijuana smoking pipe, drug paraphernalia, approximately seven ounces of marijuana individually packaged into eight separate plastic bags, and drug packaging materials. During a subsequent interview, Merchant admitted to police that she was aware that D.W. was a marijuana user.
If convicted, Merchant faces a possible maximum sentence of ten years’ imprisonment, a $250,000 fine, $100 in special assessments, and three years of supervised release following any imprisonment.
“Federal law prohibits certain people from possessing guns and ammunition,” said U.S. Attorney Techau. “Identifying and prosecuting those who knowingly provide guns to prohibited persons is a priority of this office and an important part of keeping our communities safe.”
Merchant appeared today in federal court in Cedar Rapids and was held in custody of the United States Marshals Service pending a detention hearing. Merchant’s next appearance for her detention hearing is set for February 18, 2016.
As with any criminal case, a charge is merely an accusation and a defendant is presumed innocent until and unless proven guilty.
This case was referred to the United States Attorney’s Office by local authorities and is being prosecuted by Assistant United States Attorney Lisa C. Williams. The case was investigated by the Vinton Police Department, the Iowa Department of Public Safety, the Department of Homeland Security, and the Bureau of Alcohol Tabaco and Firearms.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 16-MJ-31.
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U.S. Attorney Ortiz Announces Creation of Civil Rights UnitRead the Press Release
BOSTON – United States Attorney Carmen M. Ortiz announced today the creation of a Civil Rights Unit whose primary focus will be the civil enforcement of federal civil rights laws in Massachusetts. The new unit, which will operate within the office’s Civil Division, will also collaborate with local community members, advocacy groups and other federal and state agencies in the area of civil rights.
“As U.S. Attorney protecting the civil rights of the residents of Massachusetts has been a top priority,” said U.S. Attorney Ortiz. “We are committed to ensuring a level playing field for all residents in the Commonwealth, advancing equal opportunity, and educating the public about their rights and responsibilities. I can think of no better way to further this mission than by creating a unit comprised of attorneys and staff who are dedicated solely to enforcing and promoting federal civil rights.”
“U.S. Attorney Ortiz has demonstrated her office's firm commitment to vigorous and robust civil rights enforcement,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department's Civil Rights Division. “Institutionalizing this Civil Rights Unit will help enhance our shared mission to ensure equal opportunity and equal justice for all of the communities we serve.”
The Civil Rights Unit (CRU) is charged with enforcing federal civil rights statutes that protect the rights of the most vulnerable and underserved members of our community. The unit will focus on enforcing those laws that prohibit discrimination and harassment on the basis of race, national origin, gender, religion and disability; prohibit police misconduct; protect the constitutional rights of institutionalized persons; protect the employment rights of servicemembers; and prohibit discrimination in housing and mortgage lending. The unit will be led by Assistant U.S. Attorney Jennifer A. Serafyn.
Today, U.S. Attorney Ortiz hosted two civil rights-focused roundtables. The first focused on fair housing issues and included key stakeholders from state and local advocacy organizations. The second roundtable discussion, which featured Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division, concentrated on community-police relations with law enforcement officials and representatives from faith-based institutions and organizations serving the community.
Since 2010, the U.S. Attorney’s Office has actively investigated and resolved civil rights cases involving disability discrimination, fair housing, fair lending, and Veterans’ rights, among others. Several recent examples of the Office’s civil rights work include:
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An agreement with the City of Somerville resolving discrimination against a service member who was disadvantaged in his employment with the City’s Fire Department because of his military service;
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An agreement with Sage Bank, headquartered in Lowell, for engaging in a pattern or practice of discrimination on the basis of race and national origin in the pricing of its residential mortgage loans;
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Issued a Letter of Findings in the investigation into Massachusetts Department of Children and Families for denying opportunities, benefits, and services to a 21-year-old single mother who has a developmental disability;
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Filed Statement of Interest in private lawsuit alleging that Springfield Public Schools discriminated against hundreds of children with mental health disabilities by segregating them in a separate school;
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An agreement with edX, an online course provider, over the accessibility of its website;
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Initiated an Americans with Disabilities Act (ADA) compliance review of restaurants in the Seaport and Fort Point sections of Boston and hotels in Copley Square;
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An agreement with the Town of Ware Police Department in a case involving effective communication for a deaf person at the police station;
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An agreement with Clarendon Hill Towers, a Somerville apartment building, for violating the fair housing rights of a couple and their three children; and
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An agreement with the owners of a North Attleboro apartment complex for discriminating against families with children.
In addition to the Office’s vigorous investigation and prosecution of civil rights matters, the Civil Rights Unit also has actively been reaching out to the community and providing training on civil rights matters. For example, the Office commemorated the 25th anniversary of the ADA by hosting a roundtable discussion with disability rights advocates and celebrated the 50th anniversary of the Voting Rights Act by hosting a panel discussion on emerging voting rights issues. In honor of Veterans’ Day, the Office hosted a training for employers on the Uniformed Services Employment and Reemployment Rights Act (USERRA), and U.S. Attorney Ortiz presided at a ceremony honoring the dozens of veterans and servicemembers who work in the Moakley Federal Courthouse.
The Civil Rights Enforcement Team which U.S. Attorney Ortiz created in June 2010 will maintain responsibility for investigating and prosecuting criminal civil rights violations such as hate crimes, damage to religious property, deprivation and conspiring to deprive constitutional rights and human trafficking, including involuntary servitude, forced labor, and sex trafficking of children. Assistant U.S. Attorney Ted Merritt will continue to oversee the work of the Team.
For more information on the Office’s civil rights efforts, please visit www.justice.gov/usao-ma/civil-rights. For more information on the Department of Justice’s civil rights effort, please visit www.justice.gov/crt.
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