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31 March 2016
Former Texas D.P.S. Employee Pleads Guilty to Fraudulent Drivers License SchemeRead the Press Release
In San Antonio, 54-year-old Jose A. Ytuarte, a former Texas Department of Public Safety Customer Service Representative in Hondo, TX, pleaded guilty to his role in a scheme to provide fraudulent drivers’ licenses to undocumented aliens announced United States Attorney Richard L. Durbin, Jr., and Federal Bureau of Investigation (FBI) Special Agent in Charge Christopher Combs, San Antonio Division.
Appearing before United States District Judge Xavier Rodriguez, Ytuarte pleaded guilty to one count of use of interstate facility in aid of unlawful activity--bribery. By pleading guilty, Ytuarte admitted that from May 2013 to July 2015, he accepted cash bribes from a co-conspirator in exchange for inputting materially fraudulent information, namely that the individual was born in the United States, into the DPS computer system in order to process and issue a driver’s license to an undocumented alien.
Ytuarte’s co-defendant, 44-year-old Azeez Mistry of San Antonio, is charged in the conspiracy count. He is also charged with one count of transfer of false identification documents and four counts of use of an interstate communication facility in aid of unlawful activity. According to the indictment, Mistry would direct undocumented and documented aliens who could not get a driver’s license legally to Ytuarte. Mistry would charge between $1,000 and $5,000 for each license and then pay a portion of that fee to Ytuarte as a cash bribe.
Ytuarte, who faces up to five years in federal prison, remains on bond pending sentencing scheduled for July 13, 2016. Mistry, who is also currently on bond, is scheduled for jury selection and trial on May 2, 2016. Upon conviction, he faces up to 15 years in federal prison.
This case was investigated by the FBI, Texas Rangers and U.S. Customs and Border Protection. Assistant United States Attorney Christina Playton is prosecuting this case on behalf of the Government.
An indictment is merely a charge and should not be considered as evidence of guilt. Mistry is presumed innocent until proven guilty in a court of law.
Former Nurse at Federal Prison in Lexington Sentenced for BriberyRead the Press Release
LEXINGTON – A former nurse at the federal prison in Lexington has been sentenced for smuggling tobacco into the prison, in exchange for payments from inmates.
On Wednesday, U.S. District Judge Danny Reeves sentenced 47 year-old Michael Hardin, formerly employed as a registered nurse at the Federal Medical Center in Lexington, to twelve months in prison, for bribery of a public official. Under federal law, Hardin must serve the entire term of his sentence; and at the conclusion of his incarceration, he must serve one year of home detention. Hardin will also be required to complete 400 hours of community service during his three-year term of supervised release.
According to his plea agreement, from July 2014 to August 2015, Hardin smuggled tobacco into the prison facility for inmates, who paid him a total of $22,429 in return. The inmates used family members and friends to send the money to Hardin. As a condition of his plea agreement, Hardin repaid all the money he received.
Prisoners incarcerated in federal correctional facilities, including FMC Lexington, are prohibited from possessing contraband, such as tobacco.
Kerry B. Harvey, U.S. Attorney for the Eastern District of Kentucky; John F. Oleskowicz, Special Agent in Charge, Department of Justice, Office of the Inspector General, Chicago Field Office; Tommy D. Coke, Inspector in Charge of the U.S. Postal Inspection Service; Pittsburg Division; and Howard S. Marshall, Special Agent in Charge, Federal Bureau of Investigation, jointly made the announcement.
The investigation was conducted by the Department of Justice, Office of the Inspector General; the Federal Bureau of Investigation; and the United States Postal Inspection Service. Assistant U.S. Attorney Andy Smith prosecuted this case on behalf of the federal government.
Former Loudoun County Sheriff’s Deputy Guilty of Asset Forfeiture EmbezzlementRead the Press Release
ALEXANDRIA, Va. – Frank Michael Pearson, 45, a former Loudon County Sheriff’s Deputy from Winchester, was convicted after a bench trial today on four counts of theft in relation to his embezzlement of over $229,000 from the asset forfeiture fund at the Loudon County Sheriff’s Office.
Pearson was indicted on July 9, 2015. According to court records and evidence presented at trial, beginning in 2006 Pearson was designated as the deputy responsible for overseeing the asset forfeiture program for the Loudon County Sheriff’s Office. The evidence presented at trial showed that beginning in or about February 2010, and continuing through October 2013, Pearson embarked on a scheme and continuing course of conduct to embezzle and steal money that had been seized by other members of the Loudoun County Sheriff’s Office for potential asset forfeiture. The evidence showed that Pearson embezzled money from 80 separate cases over this period, taking in excess of $229,000 that had been entrusted to him.
The evidence further proved that Pearson concealed his embezzlement scheme by making false statements to his coworkers and others about the timing and fact of whether he had deposited seized money into an escrow account maintained by the Loudoun County Sheriff’s Office at a local bank. For example, the evidence showed that on two separate occasions, Pearson re-used an old deposit slip from an unrelated case and passed it off as a new deposit slip to conceal the fact that he had not deposited all of the money entrusted to him. The evidence further showed that in at least one instance, Pearson took money seized in one case and passed it off as money that had been seized in another case, to hide his ongoing embezzlement.
Pearson will be sentenced on June 17, and faces a maximum penalty of 10 years in prison on each of the four counts. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after the verdict was delivered by U.S. District Judge T.S. Ellis, III.
This case was investigated by the FBI’s Washington Field Office and the Virginia State Police. The Loudon County Sheriff’s Office cooperated with the investigation. Assistant U.S. Attorneys Matthew Burke and Mark D. Lytle prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:15-cr-193.
Former Elmira Teacher Indicted on Child Pornography ChargesRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051ROCHESTER, N.Y. - U.S. Attorney William J. Hochul, Jr. announced today that a federal grand jury has indicted Howard Edward Brooks, 39, of Elmira, NY, on charges of receipt, attempted distribution, and possession of child pornography involving prepubescent minors. The charges carry a mandatory minimum penalty of five years in prison, a maximum of 20 years, and a fine of up to $250,000.
Assistant U.S. Attorney Craig R. Gestring, who is handling the case, stated that according to the indictment and a previously filed complaint, Brooks, a former teacher at the Elmira Christian Academy, was arrested in August, 2015 following the execution of a federal search warrant at his Elmira residence. During that search, FBI agents found several digital items containing photos and videos of children as young as toddlers being raped.
When FBI agents arrived to execute the search warrant, Brooks tried to flush several thumb drives down the toilet. He told the agents he did so because he saw the FBI in his driveway and knew the thumb drives contained child pornography. However, agents recovered the thumb drives from the sewer under the defendant’s residence with the assistance of the Chemung County Department of Public Works. These drives were then forensically analyzed and hundreds of child pornography videos were recovered from each.
The indictment is the culmination of an investigation by the Federal Bureau of Investigation Child Exploitation Task Force which includes the Monroe County Sheriff’s Office, the Rochester Police Department, and U.S. Immigration and Customs Enforcement-Homeland Security Investigations.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.Former Charles County Circuit Court Judge Sentenced for Civil Rights ViolationRead the Press Release
Greenbelt, Maryland – U.S. Magistrate Judge William Connelly sentenced former Charles County Circuit Court Judge Robert C. Nalley, of La Plata, Maryland, today to one year of probation for deprivation of rights under color of law for ordering a deputy sheriff to activate a stun-cuff worn by a pro se criminal defendant during a pre-trial court proceeding. As a condition of his probation, Nalley must attend anger management classes. Magistrate Judge Connelly also ordered Nalley to pay a fine of $5,000.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Principal Deputy Assistant Attorney General for the Department of Justice Civil Rights Division Vanita Gupta; and Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation, Baltimore Field Office..
“Disruptive defendants may be excluded from the courtroom and prosecuted for obstruction of justice and contempt of court, but force may not be used in the absence of danger,” said U.S. Attorney Rod J. Rosenstein.
From 1988 to September 2014, Nalley served as a judge of the Circuit Court for Charles County, Maryland. According to his guilty plea, on July 23, 2014, Nalley presided over the jury selection for the victim, who was representing himself in a criminal proceeding in Charles County court. Before the proceedings began, a deputy sheriff informed Nalley that the victim was wearing a stun-cuff. Nalley was aware that when activated, the stun-cuff would administer an electrical shock to the victim, thereby incapacitating him and causing him pain.
Several minutes after the proceedings began, Nalley asked the victim whether he had any questions for the potential jurors. The victim repeatedly ignored Nalley and instead read from a prepared statement, objecting to Nalley’s authority to preside over the proceedings, while standing calmly behind a table in the courtroom. The victim did not make any aggressive movements, did not attempt to flee the courtroom, and did not pose a threat to himself or to any other person at any point during the proceedings. Nalley twice ordered the victim to stop reading his statement, but the victim continued to speak.
According to his plea agreement, Nalley then ordered the deputy sheriff to activate the stun-cuff, which administered an electric shock to the victim for approximately five seconds. The electric shock caused the victim to fall to the ground and scream in pain. Nalley then recessed the proceedings.
United States Attorney Rod J. Rosenstein and Principal Deputy Assistant Attorney General Vanita Gupta commended the FBI for its work in the investigation, and thanked Assistant U.S. Attorneys Kristi N. O’Malley and Daniel C. Gardner of the District of Maryland, and Trial Attorney Mary J. Hahn of the Civil Rights Division, who prosecuted the case.
Florida Man Indicted on Federal Bank and Wire Fraud ChargesRead the Press Release
Tampa, Florida – United States Attorney A. Lee Bentley, III announces the return of an indictment charging Leigh Farrington Fiske (52, formerly of Tampa) with three counts of bank fraud and seven counts of wire fraud affecting a financial institution. If convicted on all counts, he faces a maximum penalty of 30 years in federal prison.
According to the indictment, Fiske opened a business trust account at a national financial institution’s local branch, in Tampa, for a shell company that he controlled. Beginning in June 2010, Fiske deposited or assisted in depositing multiple checks that had purportedly been written to his company by legitimate third-party businesses and financial institutions. In fact, none of the deposited checks were genuine; all had been counterfeited or altered. After the fraudulently obtained funds posted to the account, Fiske would quickly move the money offshore, wire it to accounts held by other shell companies that he controlled, and make withdrawals and other transfers for his own benefit. The intended loss of the scheme was over $485,000.
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 unless, and until, proven guilty.
This case was investigated by the Office of the Special Inspector General for the Troubled Asset Relief Program and the Federal Bureau of Investigation. It will be prosecuted by Assistant United States Attorney Eric K. Gerard.
Five Sacramento Men Indicted for Trafficking in Drugs and GunsRead the Press Release
SACRAMENTO, Calif. — A federal grand jury returned a 32-count indictment today against five Sacramento men, charging them with various crimes related to trafficking in narcotics and firearms, United States Attorney Benjamin B. Wagner announced.
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Osvaldo Hernandez, 33, is charged with conspiring to distribute methamphetamine and heroin; distributing methamphetamine, heroin, and cocaine; and possessing with the intent to distribute methamphetamine, heroin, and cocaine.
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Hector Gonzalez, 36, is charged with conspiring to distribute methamphetamine and heroin; conspiring to deal firearms without a license, distributing methamphetamine and heroin; dealing firearms without a license; and possessing with the intent to distribute methamphetamine.
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Christopher McCurin, 40, is charged with conspiring to deal firearms without a license and being a felon in possession of a firearm.
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Noe Baeza-Bravo, 30, is charged with conspiring to distribute methamphetamine; conspiring to deal firearms without a license; distributing methamphetamine; and dealing firearms without a license.
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Vidal Gonzalez, 56, is charged with conspiring to distribute methamphetamine; distributing methamphetamine, and dealing firearms without a license.
According to court documents, between June 2014 and February 2016, on at least 19 different occasions, agents purchased methamphetamine, heroin, cocaine, and assault rifles from various defendants. According to the indictment, between April 2015 and October 2015, Baeza-Bravo, McCurin, and Hector Gonzalez conspired to willfully engage in the business of dealing in firearms without a license. Vidal Gonzalez, Baeza-Bravo, and Hector Gonzalez sold assault rifles to an FBI source.
All five defendants were arrested on March 16, 2016. All have been released pending trial except for Hector Gonzalez, who remains in custody.
If convicted, the defendants face the following penalties: the penalty for conspiring to distribute methamphetamine is 10 years to life in prison; the maximum penalty for conspiring to distribute heroin is 20 years in prison; the maximum penalty for conspiring to deal firearms without a license is five years in prison; the maximum penalty for distributing methamphetamine, heroin or cocaine is 20 years in prison; the maximum penalty for dealing firearms without a license is five years in prison; the maximum penalty for possessing with the intent to distribute methamphetamine, heroin, or cocaine is 20 years in prison; and the maximum penalty for being a felon in possession of a firearm is 10 years in prison. 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 defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
This case is the product of an investigation by the Federal Bureau of Investigation and the Sacramento Police Department. Assistant United States Attorney Ross K. Naughton is prosecuting the case.
This case was part of an Organized Crime Drug Enforcement Task Force (OCDETF). The OCDETF program was established in 1982 to conduct comprehensive, multilevel attacks on major drug trafficking and money laundering organizations. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking and money laundering organizations and those primarily responsible for the nation’s drug supply.
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Five Defendants Sentenced for their Participation in a Stolen Identity Tax Refund Fraud SchemeRead the Press Release
The last of five defendants involved in a stolen identity tax refund scheme have been sentenced in United States District Court.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), made the announcement.
According to court documents, from January 2014, through April 2014, defendants, John Mackenley Cesar, a/k/a “Cesar,” 26, of Miami, Lawrence Bernadel, a/k/a “Bernadel,” 22, of Tallahassee, Chedlor Dorilus, a/k/a “Dorilus,” 22, of Hollywood, Lubens Inalien, a/k/a “Lubaby,” a/k/a “Inalien,” 29, of Fort Lauderdale, and Ariel Ronet Walker, a/k/a “Walker,” 22, of Tallahassee, used the same Electronic Filing Identification Number (“EFIN”) at residences located in Broward County and Leon County, Florida, to file approximately 158 fraudulent tax returns with the IRS using stolen personal identifying information (“PII”) that belonged to other individuals. In order to receive the tax refunds from those fraudulent tax returns, the defendants arranged to have the tax refunds deposited onto pre-paid debit cards, including pre-paid debit cards from H & R Block. Once the tax refunds were deposited onto the pre-paid debit cards, the funds were used to purchase personal items or were withdrawn from ATMs in Broward County and elsewhere.
During the search of the residences used by the defendants to facilitate the fraudulent scheme, law enforcement recovered over 1,800 names, dates of birth, and Social Security numbers belonging to other individuals. The total intended loss amount from the unauthorized tax filings and PII recovered from the residences was between $1 million and $2.5 million dollars.
Cesar, Bernadel and Dorilus pleaded guilty to one count of conspiracy to defraud the government with respect to claims, in violation of Title 18, United States Code, Section 286; and one count of aggravated identity theft, in violation of Title 18, United States Code, Sections 1028A(a)(1) and 2. Walker pleaded guilty to one count of conspiracy to defraud the government with respect to claims, in violation of Title 18, United States Code, Section 286. Inalien pleaded guilty to one count of misprision of a felony, in violation of Title 18, United States Code, Section 4.
On August 14, 2015, Dorilus was sentenced to 70 months in prison, to be followed by three years of supervised release. On December 11, 2015, Inalien was sentenced to 8 months in prison, to be followed by one year of supervised release. On January 22, 2016, Walker was sentenced to 5 years’ probation. On March 23, 2016, Cesar was sentenced to 58 months in prison, to be followed by three years of supervised release. On March 30, 2016, Bernadel was sentenced to 42 months in prison, to be followed by three years of supervised release. Cesar, Bernadel, Dorilus and Inalien were also ordered to pay joint and several restitution in the amount of $580,584. Walker was ordered to pay restitution in the amount of $124,631.
Mr. Ferrer commended the investigative efforts of the Stolen Identity Refund Fraud Task Force, with special commendation to the FBI and IRS-CI. This case is being prosecuted by Assistant U.S. Attorney Maurice A. Johnson.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls. 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.
Federal Workers Compensation Kickback Conspirators Plead GuiltyRead the Press Release
Tampa, Florida – United States Attorney A. Lee Bentley, III announces that Tampa residents Lenin Perez and Lois Luis (a/k/a Ireno Delgado) pleaded guilty to conspiracy and kickbacks. Each faces a maximum penalty of five years in federal prison.
According to the plea agreements, Perez and Luis, who met in federal prison, conspired with each other and with others to pay kickbacks to Perez for his referring injured federal workers receiving care through the federal workers compensation program to AmeriMed Diagnostic Services, Inc., a company substantially run by Luis. In 2007, while in prison together in Alabama, Luis and Perez discussed Perez sending injured federal workers to Luis for treatment. In exchange for the referrals, Perez was supposed to receive 15-20% of the profits from AmeriMed. The amount of the kickbacks paid to Perez during the course of the conspiracy exceeded $1 million, including approximately $250,000 that was paid to Perez’s daughter for an essentially “no-show,” part-time marketing job that was actually substantially passed through her to Perez.
This case was investigated by the U.S. Department of Labor’s Office of Labor Racketeering and Fraud Investigations, the U.S. Postal Service’s Office of the Inspector General, the U.S. Department of Veterans Affairs’ Office of the Inspector General, the U.S. Department of Homeland Security’s Office of the Inspector General, the U.S. Marshals Service, and the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorney Thomas N. Palermo.
Federal Jury Finds Suffolk County Conservative Party Chairman Edward Walsh Guilty in Scheme to Defraud the Suffolk County Sheriff’s OfficeRead the Press Release
Walsh Falsely Represented that He Worked Regular and Overtime Hours for the Suffolk County Sheriff’s Office When He Was Playing Golf, Visiting Casinos, or
Performing Work on Behalf of the Suffolk County Conservative PartyLate this afternoon, following three weeks of trial, a federal jury in Central Islip, returned a guilty verdict against Suffolk County Conservative Party Chairman Edward M. Walsh, Jr., on charges that he engaged in a scheme to steal wages for regular and overtime hours in connection with his employment with the Suffolk County Sheriff’s Office (SCSO). The jury convicted the defendant of both counts of an indictment charging him with theft of government funds and wire fraud, in violation of Title 18 U.S.C. §§ 666 and 1343, respectively.
The verdict was announced by Robert L. Capers, United States Attorney for the Eastern District of New York and Diego Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI).
At trial, the government successfully proved that from January 2011 to April 2014, Walsh, a SCSO Correction Officer III Investigator, falsely represented to the SCSO that he had worked certain regular and overtime hours when, in fact, he did not work those hours. Contrary to his representations, the government successfully established that Walsh was, among other things, playing golf, gambling at Foxwoods Casino, or performing work on behalf of the Suffolk County Conservative Party. In reliance on Walsh’s false representations, the SCSO paid Walsh wages for hours he did not work. At trial, investigators estimated that Walsh was paid more than $200,000 for regular and overtime hours he did not work.
“Today’s verdict once again establishes that no one person is above the law. Edward Walsh abused his position and authority as a political boss to steal from taxpayers in order to fund his personal and political activities. Now he will be held accountable for his actions,” stated United States Attorney Capers. “We and our partners in the FBI will continue to root out government corruption and fraud wherever we find it.”
Assistant Director-in-Charge Rodriguez stated, “Defrauding the government never pays as Mr. Walsh found out today with the guilty verdict. Mr. Walsh cheated Suffolk County and ultimately the tax payers for hours never worked. The FBI remains committed to working with our law enforcement partners to root out fraud to the government in any form.”
Upon sentencing the defendant Walsh faces a potential sentence of up to 30 years at the time of sentence.
The government’s case was prosecuted by Assistant United States Attorneys Catherine M. Mirabile and Raymond A. Tierney
The Defendant:
Edward M. Walsh, JR.
Age: 50
East Islip, New YorkE.D.N.Y. Docket No. 15-CR-091(ADS)
Federal Indictment Charges Defendant with Drug Trafficking & Firearms Charges Linked to Murder of Seaside Police SergeantRead the Press Release
PORTLAND, Ore. – Jamie Lee Jones, 44, a former resident of Nevada, was indicted today on drug trafficking, firearms, and witness tampering charges, announced U.S. Attorney Billy J. Williams. Jones was living in Seaside in early February 2016, during the time of the alleged offense conduct. The indictment charges Jones with possession with intent to distribute methamphetamine; felon in possession of a firearm; two counts of tampering with a witness by physical force or threat; and use and carry of a firearm during and in relation to a crime of violence. The defendant is currently in custody. Trial will be scheduled at defendant’s initial appearance and arraignment on the federal indictment.
The federal charges arise after a two-month, multi-agency investigation tracing the firearm used in the February 5, 2016, homicide of Seaside Police Sergeant Jason Goodding. As alleged in the indictment, Jones is accused of tampering with two witnesses by using physical force and the threat of physical force against them with the intent of hindering or preventing the witnesses from communicating information to law enforcement regarding the federal offense of being a felon in possession of a firearm, and the use of that firearm by another to shoot and kill a law enforcement officer. Specifically, Jones is accused of threatening to kill a witness, striking a witness, and discharging a firearm near both witnesses, all with the intent to hinder or prevent them from communicating information to law enforcement.
Douglas Dawson, Special Agent in Charge of the ATF in Oregon stated, “The ATF remains committed in our partnership with state and local law enforcement, holding responsible anyone who threatens the safety of our community.”
The use of a firearm count carries a 10-year mandatory minimum, a maximum sentence of life in prison and a fine of $250,000. An indictment is only an accusation of a crime, and a defendant is presumed innocent unless and until proven guilty.
The agencies participating in the investigation are the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the Clatsop County Sheriff’s Office, the Clatsop County Major Crimes Team, the Cannon Beach Police Department, the Astoria Police Department, the Oregon State Police, the Clatsop County District Attorney’s Office, and the U.S. Attorney’s Office, District of Oregon.
The case is being prosecuted by Assistant U.S. Attorney Leah K. Bolstad.
The indictment can be found attached below.
Federal Grand Jury Indicts Two Men for Robbing Individuals at Gunpoint at ATMs in West and Northwest SuburbsRead the Press Release
CHICAGO — Two men have been indicted in connection with the armed robberies of individuals at automated-teller machines in the west and northwest suburbs of Chicago, federal authorities announced today.
The indictment alleges that KENNETH HAYES and ANTONIO DUNNER forced victims to withdraw money from drive-thru ATMs. Wearing disguises to cover their faces, the pair verbally threatened the individuals while Hayes brandished a firearm, the indictment states. Hayes and Dunner divided the proceeds between themselves, according to the indictment.
The indictment was returned yesterday in U.S. District Court in Chicago. It charges Hayes, 21, of Carpentersville, and Dunner, 22, of Elgin, with one count of conspiracy to interfere with commerce by threats or violence, five counts of interfering with commerce by threats or violence, and two counts of carrying, using or brandishing a firearm in connection with a crime of violence.
An arraignment date in federal court has not yet been scheduled.
The indictment alleges that the pair robbed or attempted to rob individuals at drive-thru ATMs in Glen Ellyn on Sept. 16, 2015; Park Ridge on Sept. 23, 2015; Arlington Heights on Oct. 19, 2015; and Northbrook on Sept. 23, 2015, and Oct. 8, 2015.
The pair is also accused in the indictment of robbing a gas station in Elmhurst on Nov. 1, 2015, with Hayes brandishing a firearm during the heist.
According to the indictment, Hayes and Dunner scouted drive-thru ATMs for potential robberies. Once the pair settled on a location, they traveled to the site together in Hayes’ vehicle and concealed themselves while watching for individuals using the ATMs. In addition to cash, Hayes and Dunner often stole the victims’ cellular telephones and disposed of them to prevent the victims from being able to quickly contact law enforcement, according to the indictment.
The indictment was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation. The Police Departments from Arlington Heights, Carpentersville, Elgin, Northbrook, Glen Ellyn, Park Ridge and Elmhurst provided substantial assistance in the investigation.
The conspiracy charge and each count of interfering with commerce by threats or violence carries a maximum sentence of 20 years. Carrying, using or brandishing a firearm in connection with a crime of violence is punishable by a mandatory minimum sentence of seven years for the first count, and a mandatory minimum of 25 years for the second count.
The public is reminded that an indictment is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
The government is represented by Assistant U.S. Attorney Jordan Palmore.
Indictment
Drug Dealer from Brooklyn, New York Sentenced in Federal Court to over Nine Years Imprisonment for Distributing Heroin and Crack Cocaine in Rutland CountyRead the Press Release
The United States Attorney for the District of Vermont, Eric Miller, announced today that Raymond Fernandez, 33, of Brooklyn, Vermont was sentenced to nine years and two months imprisonment by Chief Judge Christina Reiss in United States District Court in Burlington. Fernandez had previously pled guilty to conspiracy to distribute heroin and crack cocaine. In addition to the term of imprisonment, Chief Judge Reiss sentenced Fernandez to eight years of supervised release, which will begin when he finishes his prison term.
According to court records, Raymond Fernandez was one of the leaders of the Gritty Gang from Brooklyn, New York. The Gritty Gang is not a gang in the common usage of the word but a group of associates and relatives from the Albany Projects of Brooklyn, who often worked together to bring heroin and crack cocaine to Rutland County to distribute. The name originated from a rap group by that name that some of these individuals had formed.
According to court records the common scheme of this conspiracy was to use young women drug addicts, often from Rutland County, to body pack heroin and crack cocaine from Brooklyn, New York to Rutland County. These woman, along with other addicts from the Rutland area, distributed many of these drugs in Rutland County for Fernandez and his Brooklyn based associates. One female addict testified that Fernandez once hit her because she used some of Fernandez’ drugs she was holding for him.
According to court records, between late 2012 and mid-2014, Fernandez was involved in bringing over 400 grams of crack cocaine to the Rutland area and over 250 grams of heroin. The Court also found there was sufficient evidence to conclude that when one of Fernandez’ Brooklyn coconspirators broke off from Fernandez and started selling drugs in Rutland County independently from Fernandez, Fernandez stabbed him on the streets of Brooklyn.
The Government also alleged, and the Court found, that in early 2014 Fernandez participated in a prostitution organization in New York City, which involved bringing young women addicts from the Rutland Vermont area to New York City where they would engage in prostitution for Fernandez’ profit. The Government alleged in its sentencing memorandum:
When one of these girls reached out to her family in March 2014, and thereby caused the FBI to start investigating, the defendant assaulted this woman and feigned shooting her up with rat poison. This young woman thought she was going to die.
In support of its sentencing recommendation, the Government also stated:
It is difficult to quantify the amount of havoc and destruction wrought by the defendant’s drug dealings. It cannot be disputed, however, that it was significant given the quantities of heroin and crack cocaine involved here. There can be no question that the defendant, in lining his own pockets, is, in part, responsible for assisting in the shattering of the lives of drug addicts and their families.
This investigation was initiated in early 2015, when federal, state, and local law enforcement focused significant resources on dismantling this large drug trafficking organization which brought significant amounts of heroin and crack cocaine from the Brooklyn, New York area to Rutland County. This extensive investigation resulted in federal charges and convictions for over 30 individuals from Brooklyn, New York and Vermont. All but two individuals have pled guilty and most all have been sentenced. U.S. Attorney Eric Miller stated, “the success of this operation is the direct result of the hard and dedicated work of a team of law enforcement agents from the Vermont State Police Drug Task Force, the Federal Bureau of Investigation, the Drug Enforcement Administration, and the Rutland City Police.”
The United States is represented in this matter by Assistant U.S. Attorney Joseph Perella. Fernandez is represented by Chandler Mattson, Esq. of Stowe, Vermont.
Dominican Man Sentenced for Illegal Reentry After DeportationRead the Press Release
CONCORD, NEW HAMPSHIRE –United States Attorney Emily Gray Rice announced today that Edwin Orlando Tejeda Aria, of the Dominican Republic, was sentenced to twenty-four months in federal prison, after pleading guilty to illegally reentering the United States after having been previously deported.
On June 16, 2015 two United States Immigration and Customs Enforcement (ICE) officers assigned to Enforcement and Removal Operations responded to the New Hampshire Division of Motor Vehicles in Salem, New Hampshire after receiving a call from New Hampshire State Police asking for assistance identifying a male individual, subsequently identified as the defendant, who was presenting fraudulent identification to obtain a New Hampshire Driver's License. The fraudulent document included a Puerto Rican Birth certificate, a Social Security card, a Pennsylvania Driver's License, and a Comcast bill. Both ICE officers identified themselves to the defendant, and then one of them fingerprinted him and submitted the prints to the FBI’s Integrated Automated Fingerprint Identification System (IAFIS) and the ICE Automated Biometric Identification System (IDENT). Both systems produced a match for Edwin Orlando Tejeda-Aria, an alien who had been deported in 2011 from Louisiana to the Dominican Republic.
Tejeda Aria was taken into ICE custody and transported to the Manchester ICE office where a full set of fingerprint impressions were taken from him and submitted to the Department of Homeland Security's IDENT system and to the FBI’s IAFIS system for comparison to databases of known fingerprints. Both systems confirmed the match to the submitted fingerprints of the defendant.
Tejeda Aria pled guilty to the charge on December 9, 2015.
The case was investigated by the New Hampshire State Police and the Department of Homeland Security and prosecuted by Assistant U.S. Attorney Alfred Rubega.
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District Man Pleads Guilty to Disfiguring Victim in Knife Attack in Southeast WashingtonRead the Press Release
WASHINGTON - Meguiel Jackson, 36, of Washington, D.C., pled guilty today to a charge of malicious disfigurement while armed for cutting a woman approximately 28 times, all over her body, with a knife in an attack that occurred at an apartment building in Southeast Washington, U.S. Attorney Channing D. Phillips announced.
Jackson pled guilty in the Superior Court of the District of Columbia. The plea, which is contingent upon the Court’s approval, calls for a prison sentence of 12 years. The Honorable José M. López scheduled sentencing for June 3, 2016.
According to the government’s evidence, on the evening of Jan. 22, 2016, Jackson entered an apartment building in the 4700 block of C Street SE. He was brought to an apartment by the victim, and she permitted him into her bedroom. Jackson became angry when the victim refused to allow him to inspect her cellular telephone to see her text messages. At one point, he said words to the effect of “I am tired of you ---,” and began to assault her. She lost consciousness. While she was unconscious, Jackson took a knife and began to cut her.
Jackson cut the victim’s body approximately 28 times all over, including her face, her chest, her back, her buttocks, and her legs. Some of the wounds were so deep that tissue was exposed. Jackson ultimately broke the knife in the process of cutting her. He then left the building later that evening. He was arrested Jan. 30, 2016 and has been in custody ever since.
The victim was found to have suffered a total of 28 wounds to the face and body. Also, during the attack, she received a broken jaw and a broken orbital bone in her face. The victim is permanently disfigured as a result of the injuries inflicted by Jackson.
In announcing the plea, U.S. Attorney Phillips commended the work of the detectives of the Metropolitan Police Department’s Sixth District, the patrol officers who responded in a major snowstorm to the crime scene, and the crime scene officers who processed the scene. U.S. Attorney Phillips also commended the efforts of those who worked on the case from the U.S. Attorney’s Office, including Victim/Witness Advocate Shawn Slade; Supervisor Security Specialist Michael Hailey; Victim/Witness Security Specialist M. Laverne Forrest; and Paralegal Specialist Tierra Nanches. Finally, U.S. Attorney Phillips thanked Assistant U.S. Attorneys Stuart D. Allen and Julianne Johnston, who investigated and prosecuted the case.
Department of Justice Issues Final Rule Extending Religious Liberty Protections to Beneficiaries of Federally-Funded ProgramsRead the Press Release
Today the Department of Justice, along with other federal agencies, published a final rule that will provide religious liberty protections to beneficiaries of social services provided by faith-based organizations that receive federal financial assistance and will affirm that such organizations are able to compete for government funds on the same basis as other organizations.
For example, under the new regulations, a religious organization that is awarded a grant to carry out a social service must notify any beneficiary, in writing, that he or she may not be discriminated against based on religion and may request an alternative provider if he or she objects to the religious character of the organization. In addition, the regulations specify that all decisions about federal financial assistance must be based on merit, not on an organization’s religious affiliation or lack thereof. The regulations—which are being published after public notice and comment—formally implement Executive Order 13559, entitled “Fundamental Principles and Policymaking Criteria for Partnerships with Faith-Based and Other Neighborhood Organizations.”
Among other things, the department’s final regulations:
- Require that all decisions about awards of federal financial assistance from the department must be made on the basis of merit, not on the basis of religion, religious belief, or lack thereof and must be free from political interference, or even the appearance of such interference.
- Reaffirm that faith-based or religious organizations are eligible to participate in any department program for which they are otherwise eligible on the same basis as any other organization.
- Clarify that organizations that receive direct federal financial assistance from the department may not engage in “explicitly religious activities” unless they are offered separately, providing examples of such activities.
- Prohibit organizations that receive federal financial assistance from the department from discriminating against beneficiaries or prospective beneficiaries on the basis of religion, a religious belief, a refusal to hold a religious belief, or a refusal to attend or participate in a religious practice.
- Require faith-based or religious organizations providing services under a program supported by direct federal financial assistance from the department to provide written notice of certain protections to beneficiaries and prospective beneficiaries, including the following statements—
- The organization may not discriminate against beneficiaries or prospective beneficiaries on the basis of religion, a religious belief, a refusal to hold a religious belief, or a refusal to attend or participate in a religious practice;
- The organization may not require beneficiaries or prospective beneficiaries to attend or participate in any explicitly religious activities that are offered by the organization and any participation by beneficiaries in such activities must be purely voluntary;
- The organization must separate in time or location any privately funded explicitly religious activities from activities supported by direct federal financial assistance;
- If a beneficiary or prospective beneficiary objects to the religious character of the organization, the organization will undertake reasonable efforts to identify and refer the beneficiary or prospective beneficiary to an alternative provider to which the beneficiary or prospective beneficiary has no objection; and
- Beneficiaries or prospective beneficiaries may report an organization’s violation of these protections, including any denials of services or benefits by an organization, by contacting or filing a written complaint with the Office for Civil Rights or the intermediary that awarded funds to the organization.
The final regulations become effective 30 days after publication in the Federal Register and recipients of federal financial assistance must comply with the regulations 90 days after publication in the Federal Register. For more information, click here.
- Require that all decisions about awards of federal financial assistance from the department must be made on the basis of merit, not on the basis of religion, religious belief, or lack thereof and must be free from political interference, or even the appearance of such interference.
Department of Justice Announces Solicitation for Community Policing Development ProgramRead the Press Release
Up to $8 million to support community policing and implementation of the recommendations of the President’s Task Force on 21st Century Policing
The Office of Community Oriented Policing Services (COPS Office) today announced the opening of the application period for its Community Policing Development (CPD) Program. Up to $8 million is available to fund projects that support implementation of the recommendations of the President’s Task Force on 21st Century Policing Report. These recommendations aim to strengthen public trust and foster strong relationships between local law enforcement and communities, while also promoting effective crime reduction.
The CPD Program is designed to address critical topics in the law enforcement field by building on the principles of community policing through training and technical assistance, the development of innovative community policing strategies, applied research, guidebooks and best practices that are national in scope.
This year, the program will fund projects related to six topic areas: The Microgrant Initiative for Law Enforcement, Critical Response Technical Assistance, Community Policing Emerging Issues Forums, Community Policing Training Projects, Law Enforcement Led 21st Century Policing Demonstration Projects and 21st Century Policing Implementation Projects.
“The funding announced today reflects this Administration’s commitment to and support for law enforcement,” said COPS Office Director Ronald Davis. “Through this program, the COPS Office will provide substantial assistance to law enforcement in its efforts to build community trust and enhance public safety and national security.”
The CPD Program is a competitive solicitation, open to all public governmental agencies, profit and nonprofit institutions, institutions of higher education, community groups and faith-based organizations. For more information on program requirements, application instructions, frequently asked questions and other information, visit the CPD Program page on the COPS Office website.
The COPS Office is a federal agency responsible for advancing community policing nationwide. Since 1995, the COPS Office has invested more than $14 billion to advance community policing, including grants awarded to more than 13,000 state, local and tribal law enforcement agencies to fund the hiring and redeployment of more than 127,000 officers and provide a variety of knowledge resource products including publications, training and technical assistance. For additional information about the COPS Office, please visit www.cops.usdoj.gov.
Dennis Richard Smith Sentenced to More Than 19 Years in Prison for KidnappingRead the Press Release
KNOXVILLE, Tenn. – On March 31, 2016, Dennis Richard Smith, 55, of Knoxville, Tenn., was sentenced by the Honorable Pamela L. Reeves, U.S. District Court Judge, to serve 235 months in federal prison.
In July 2014, Smith pleaded guilty to the May 2014 kidnapping of his ex-wife from a home where she worked as a housekeeper in west Knoxville. Evidence presented at the sentencing hearing showed that Smith broke a window to gain entry into the residence. He then brandished an airsoft pistol, placed the pistol against the victim’s head, threatened to kill her, and forcibly kidnapped her. The victim did not realize that the pistol was an airsoft pistol until after she was rescued by law enforcement. The victim had previously been stalked and harassed by Smith and had a valid order of protection against Smith. After taking the victim and holding her for several hours, Smith fled with her to North Carolina. He communicated with the victim’s family by phone and told them that if anyone tried to stop him, they would never see her again.
In the late hours of May 7, 2014, law enforcement determined that the vehicle Smith was driving was at a rest area on Interstate-40E in North Carolina. After surrounding the vehicle, law enforcement arrested Smith and freed the victim.
Agencies involved in this investigation include the Federal Bureau of Investigation (FBI) Safe Streets Task Force, Knoxville Division, which is made up of agents with the FBI and officers from Knoxville Police Department and Knox County Sheriff’s Office; Knoxville Police Department; FBI, Charlotte, North Carolina Division; McDowell County, North Carolina, Sheriff’s Department; Marion, North Carolina Police Department; North Carolina Highway Patrol; and McDowell County, North Carolina Office of Emergency Management. Assistant U.S. Attorney Cynthia F. Davidson represented the United States.
Demopolis Woman Sentenced to Four Years in Prison for Tax Evasion and Filing False ReturnsRead the Press Release
BIRMINGHAM – A federal judge today sentenced a Demopolis woman to nearly four years in prison for filing more than $250,000 in false tax returns, announced U.S. Attorney Joyce White Vance, FBI Special Agent in Charge Roger C. Stanton and Internal Revenue Service, Criminal Investigation, Special Agent in Charge Veronica Hyman-Pillot.
EUNICE F. PLUMMER, 36, pleaded guilty in October before U.S. District Judge L. Scott Coogler to three counts of attempting to evade or defeat a large portion of the income tax she owed for 2011, 2012 and 2013. She also pleaded guilty to eight counts of filing false tax returns for other people between 2011 and 2013. Judge Coogler sentenced her to three years and 10 months in prison and ordered her immediately into the custody of U.S. Marshals.
According to the indictment and her plea agreement with the government, Plummer operated a tax preparation business in Birmingham, called Plummer Tax Services, from 2010-2014. During that time, she routinely inflated the amount of tax refunds her customers would receive by using fraudulent information —including wage amounts, child and dependent care expenses, education credits and business losses – on tax returns. Plummer also substantially underreported her income from operating Plummer Tax Services. Between the taxes she failed to pay on her own behalf and the boosted refund amounts from the fraudulent tax returns she filed for clients, Plummer cheated the IRS out of more than $250,000.
In January and February this year, while Plummer was on bond awaiting sentencing following her guilty plea, she reactivated her tax business under a new name, Unique Tax Services, at the same location where she had operated Plummer Tax Services, and filed more tax returns that were fraudulent. Judge Coogler told Plummer at sentencing that by continuing to file fraudulent tax returns after pleading guilty to that conduct, she showed “disdain and disrespect” to the court and acted like “a thief” and “a con artist.”
The FBI and IRS-CI investigated the case, which Assistant U.S. Attorney Xavier O. Carter Sr. and Amanda Wick prosecuted.
Delaware County Man Convicted in Tax SchemeRead the Press Release
PHILADELPHIA – A federal jury, today, returned guilty verdicts against Jean Baptiste Alvarez, a/k/a “Alex,” 43, of Aldan, PA, on charges related to a tax fraud scheme. Alvarez was found guilty of conspiracy to defraud the United States with respect to false claims, aggravated identity theft, and misuse of Social Security numbers. U.S. District Court Judge Michael Baylson scheduled a sentencing hearing for July 26, 2016. Alvarez faces a mandatory minimum sentence of at least two years in prison with a maximum possible sentence of 24 years in prison, up to three years of supervised release, a possible fine, and a $500 special assessment.
According to evidence presented at trial, Alvarez unlawfully provided to Peterson Rene, charged elsewhere, the personal identifying information (PII) of hundreds of real persons. Specifically, the defendant sold Rene patient information labeled “census sheets” that were created by, and kept in the normal course of business, at the Kirkbride Center health care facility where the defendant worked. These “census sheets” list personal identifying information of patients, including names, social security numbers, and dates of birth. From 2012 through 2015, Alvarez and Rene conspired with others to use the stolen identifying information on tax returns for the purpose of obtaining payment of false, fictitious, and fraudulent refunds.
The case was investigated by IRS Criminal Investigations, the Federal Bureau of Investigation, and the Social Security Administration Office of Inspector General. It is being prosecuted by Assistant United States Attorney Terri A. Marinari and DOJ Tax Division Trial Attorney Ann M. Cherry.
Dedham Man Pleads Guilty to Armed Bank RobberyRead the Press Release
BOSTON – A Dedham man pleaded guilty yesterday in U.S. District Court in Boston to armed bank robbery.
Lawrence J. Costello, 54, pleaded guilty to one count of armed bank robbery. U.S. District Court Judge Nathan M. Gorton scheduled sentencing for July 27, 2016.
On May 12, 2014, Costello and another individual, armed with what appeared to be semi-automatic weapons, entered a Bank of America branch in Attleboro. Once inside, Costello jumped over the teller’s counter, and took $17,687 in cash while holding the tellers at gunpoint. The men fled in a green Ford pickup truck. The pickup truck was recovered a short time later and determined to have been stolen. During the investigation, law enforcement recovered a pair of red and black gloves which testing revealed contained Costello’s DNA. Costello was arrested a few weeks later in Bourne, Mass.
The charge provides for a sentence of no greater than 25 years in prison, five years of supervised release, a fine of $250,000 and restitution. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
U.S. Attorney Carmen M. Ortiz; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Attleboro Police Chief Kyle Heagney; Bourne Police Chief Dennis Woodside, made the announcement today. The case was handled by Assistant U.S. Attorney Kenneth G. Shine of Ortiz’s Major Crimes Unit.
Cumberland County Brothers Guilty of Tax EvasionRead the Press Release
Concealed income from the sale of stolen copper wire
BOWLING GREEN, Ky. – Two brothers from Cumberland County, Kentucky, pled guilty in United States District Court yesterday, before U.S. District Judge Greg N. Stivers, to separate, and multiple charges of tax evasion and failure to file tax returns, relating to the concealment of income from the sale of stolen copper wire, announced United States Attorney John E. Kuhn, Jr.
Christopher Chad Pruitt, 39, and Jimmy Lee Pruitt, 47, admitted in court yesterday to evading federal income taxes on the illegally obtained income. The brothers’ scheme involved stealing copper wire from Belden, Inc., located in Wayne County, Kentucky, and then selling the stolen copper wire to Bowling Green Recycling (BGR), located in Warren County, Kentucky. Jimmy Pruitt, a manager at Belden, would arrange for the theft of the copper wire through the use of false invoices. BGR would pay the brothers with checks. The brothers would then convert the BGR checks into cashier’s checks made payable to themselves and deposit the cashier checks into their personal bank accounts or tender the cashier’s checks for cash.
The Pruitts admitted to concealing the illegal income from the Internal Revenue Service. Jimmy Pruitt filed a joint income tax return for himself and his spouse each year from 2009 through 2013, but never reported any of the income received from the stolen copper wire. According to the plea agreement, Jimmy Pruitt acknowledged owing $198,547 to the IRS, exclusive of penalties and interest, prior to sentencing. Further, Jimmy Pruitt admitted owing an additional tax due for the tax years of 2007 and 2008 of $28,595 bringing his total tax liability to $227,142.
In a separate plea agreement, Christopher Pruitt admitted to participating in the scheme with his brother Jimmy Pruitt to steal copper wire from Belden, Inc. and sell the stolen copper wire to BGR. Christopher Pruitt did not file an individual income tax return in 2009 or 2010; he filed an individual income tax return each year from 2011 through 2013, but never reported any of the income received from the stolen copper wire. According to the plea agreement, Christopher Pruitt acknowledges owing $94,030 to the IRS, exclusive of penalties and interest, prior to sentencing. Further, Christopher Pruitt admitted owing an additional tax due for the tax years of 2007 and 2008 of $6,647 bringing his total tax liability to $100,677.
Jimmy Pruitt faces up to 25 years in prison, a combined maximum fine of $500,000, and a one-year term of supervised release.
Christopher Pruitt faces up to 17 years in prison, a combined maximum fine of $350,000, and a one-year term of supervised release.
Sentencing is scheduled for July 7, in Bowling Green, before Judge Stivers.
This case is being prosecuted by Assistant United States Attorney Nute Bonner and is being investigated by the IRS Criminal Investigation.
Columbus Gang Member Pleads Guilty to Rico ChargesRead the Press Release
COLUMBUS, Ohio – A former fugitive pleaded guilty in connection to a racketeering case involving the organized criminal enterprise known as the Short North Posse.
Andre M. Brown, 33, of Columbus, pleaded guilty to one count of racketeering conspiracy, one count of marijuana possession and one count of use of a firearm during and in relation to a drug trafficking crime.
Brown was arrested by FBI agents in Charlotte, N.C. in June 2015. Brown had been a fugitive since October 2014 when he was charged in a superseding indictment related to his role in the gang.
Benjamin C. Glassman, Acting United States Attorney for the Southern District of Ohio, Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), David A. Grant, Acting Special Agent in Charge, Drug Enforcement Administration (DEA), Donald J. Sorrano, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Franklin County Prosecutor Ron O’Brien and Columbus Police Chief Kim Jacobs announced the plea entered into today before U.S. District Judge Algenon L. Marbley.
Twenty individuals total were indicted in the racketeering case with charges that included murders, attempted murders, drug trafficking, weapons trafficking, extortion and robbery.
Racketeering conspiracy is a crime punishable by up to 20 years in prison. Marijuana possession carries a potential maximum sentence of five years in prison. Using a firearm in furtherance of drug trafficking is a crime punishable by seven years up to life in prison to be served consecutively to other sentences.
Acting U.S. Attorney Glassman commended the two-year long investigation by federal, state and local law enforcement agencies, including the FBI, DEA, ATF, Columbus Police, Franklin County Sheriff Zach Scott’s Office, Franklin County Prosecutor Ron O’Brien’s Office, Fairfield County Prosecutor Gregg Marx, Licking County Prosecutor Kenneth Oswalt, Muskingum County Prosecutor D. Michael Haddox, Ross County Prosecutor Matthew S. Schmidt, law enforcement leaders from those counties, officials of the Ohio Department of Rehabilitation and Correction, as well as Assistant U.S. Attorneys David DeVillers, Kevin Kelley and Brian Martinez, and Special Assistant U.S. Attorney Jimmy Lowe with Franklin County Prosecutor O’Brien’s Office, who are prosecuting the case.
Trial is scheduled to begin on April 4 for five of the individuals in this case. A second trial is currently scheduled for July 11 and a third trial is currently scheduled to begin on September 26.
Colton, Washington Man Sentenced to Five Years in Federal Prison for Distribution of Child PornographyRead the Press Release
Spokane – Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that Chris Alan Nebelsieck, age 44, of Colton, Washington, was sentenced today, after having previously pled guilty on December 15, 2015 to Distribution of Child Pornography. United States District Judge Rosanna Malouf Peterson sentenced Nebelsieck to a five year term of imprisonment, to be followed by a five year term of court supervision after he is released from Federal prison. In addition, Nebelsieck was ordered to pay restitution in the amount of $3,400 and forfeit to the United States numerous computers and digital items that he used to store and distribute child pornography. Nebelsieck will also be required to register as a sex offender.
According to information disclosed during the court proceedings, Nebelsieck was using a Peer to Peer file sharing account to share and distribute child pornography images over the Internet. Undercover law enforcement agents located child pornography files Nebelsieck was making available for download and later obtained a federal search warrant for Nebelsiecks’ residence. On July 16, 2014, Homeland Security Investigations Agents and officers from the Asotin County Sheriff’s Office executed a federal search warrant at Nebelsiecks’ residence and seized Nebelsiecks’ computers and digital devices that he used to store and distribute child pornography. A forensic examination of Nebelsiecks’ personal computer revealed 11,792 child pornography images and 723 videos of child pornography.
Michael C. Ormsby stated, “I commend the Asotin County Sheriff’s Office and Homeland Security Investigations for their efforts in successfully investigating this case. Prosecuting offenders who distribute child pornography is one of the top priorities of the United States Attorney’s Office for in the Eastern District of Washington. This Office, together with its law enforcement partners, is committed to prosecuting aggressively and seeking appropriate punishment for child pornography crimes.
This case was prosecuted as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. The Project Safe Childhood Initiative (“PSC”) has five major components:
· Integrated federal, state, and local efforts to investigate and prosecute child
exploitation cases, and to identify and rescue children;
· Participation of PSC partners in coordinated national initiatives;
· Increased federal enforcement in child pornography and enticement cases;
· Training of federal, state, and local law enforcement agents; and
· Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
This investigation was conducted by Homeland Security Investigations and the Asotin County Sheriff’s Office. The case was prosecuted by Stephanie J. Lister, an Assistant United States Attorney and Project Safe Childhood Coordinator for the Eastern District of Washington.
Clinton Man Sentenced to Prison for Receiving Child PornographyRead the Press Release
DAVENPORT, IA – On March 30, 2016, Timothy John Hansen, 44, of Clinton, Iowa, was sentenced by Chief United States District Court Judge John A. Jarvey to 130 months in prison for receiving child pornography, announced Acting United States Attorney Kevin E. VanderSchel. Hansen was ordered to serve five years of supervised release following his prison term, comply with the sex offender registry requirement in the state he lives, and to pay $100 towards the Crime Victims’ Fund. Hansen was also ordered to forfeit the electronic devices involved in the offense.
Hansen pleaded guilty to receiving child pornography on September 25, 2015. According to the plea agreement, a search warrant was executed at Hansen’s Clinton residence and electronic devices were seized. Hansen admitted to downloading child pornography (images and videos) on his various electronic devices. A forensic examination concluded there were 7,670 images (dating from 2010 to 2013) and 63 videos containing minors engaged in sexually explicit conduct (dating from 2011 to 2012).
This matter was investigated by the Clinton Police Department, Iowa Internet Crimes Against Children Task Force, The National Center for Missing and Exploited Children, and Davenport Police Department. The case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa as part of the Project Safe Childhood initiative.
Cheyenne Man Sentenced for Heroin ConspiracyRead the Press Release
Jacob Nichols, 25, of Cheyenne, Wyoming, was sentenced by Federal District Court Judge Alan B. Johnson on March 29, 2016, for conspiracy to distribute 50 grams or more of heroin and for carrying a firearm during and in relation to a drug trafficking crime. Nichols was arrested in Cheyenne, Wyoming. He received 120 months imprisonment, to be followed by four years of supervised release, and was ordered to pay a $200.00 special assessment and restitution in the amount of $300.00. This case was investigated by the Cheyenne Police Department.
California Man Federally Charged with Travel with Intent to Engage in Criminal Sexual Conduct and Coercion of A Minor to Engage in Sexual ActivityRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Stephen Chang, age 27, from Los Angeles, California was indicted yesterday by a federal grand jury in Harrisburg for travel with intent to engage in criminal sexual conduct and coercion of sexual activity from a minor.
Chang was arrested at the Harrisburg International Airport on Saturday, March 5, 2016 and originally charged in a criminal complaint with three counts of travel with intent to engage in criminal sexual conduct.
According to United States Attorney Peter Smith, Chang allegedly began communicating with a minor female when she was only 13 years old. The communications began in August 2014 and continued until the day of his arrest. During these conversations, Chang enticed the juvenile to produce and send sexual exploitative images. Chang also traveled from Los Angeles, California to Elizabethtown, Pennsylvania on December 12, 2014, October 1, 2015 and March 4, 2016, to engage in sexual conduct with the minor. On January 29, 2016, police were notified by the National Center for Missing and Exploited Children in a CyberTipline report about Facebook communications between the minor residing in Elizabethtown, Pennsylvania and an adult male in California, later identified as Stephen Chang.
Chang appeared before U.S. Magistrate Judge Susan E. Schwab on March 7, 2016 for his initial appearance and preliminary hearing. Judge Schwab found probable cause to conclude that Chang traveled to Pennsylvania to engage in sexual conduct with a minor and ordered Chang temporarily detained pending a detention hearing on March 10, 2016. Chang was ordered detained at his detention hearing.
This case was investigated by the Federal Bureau of Investigation, the Lancaster County District Attorney’s Office, the Elizabethtown Police Department, the Northwest Regional Police Department, the Dauphin County District Attorney’s Office and the Harrisburg International Airport Police and demonstrates an excellent collaborative investigative effort to remove dangerous sexual predators from the street and protect the communities’ children. The federal charges are being prosecuted by Assistant United States Attorney Daryl Bloom.
If you have any information related to this case or believe you or someone you know may be a victim, you are encouraged to contact the Federal Bureau of Investigation at 717-232-8686.
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."
All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law for travel with intent to engage in criminal sexual activity is 30 years’ imprisonment, a term of supervised release following imprisonment, and a $250,000 fine. The maximum penalty under federal law for coercion and enticement of sexual activity from a minor is life imprisonment, a term of supervised release following imprisonment, and a $250,000 fine.
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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Boston Man Charged with Multi-Million Dollar Scheme to Defraud Brokerage FirmsRead the Press Release
BOSTON – A Boston man was arrested today in connection with a three-year, multi-million dollar fraud scheme.
Nathaniel Ponn, 27, of Boston, was charged in a criminal complaint with two counts of wire fraud. He will appear before U.S. District Court Magistrate Judge Judith G. Dein at 2:15 today.
According to court documents, it is alleged that from 2012 to April 2015, Ponn opened more than 400 brokerage accounts at nine investment firms throughout the United States, and used false names, social security numbers, assets and income to open many of them. The firms allow customers to transfer funds from another financial institution into the customer’s brokerage account through an Automated Clearing House (ACH) transfer, by providing the account number and financial institution where the account was held and the amount to be transferred.
According to the complaint, from February 2014 to April 2015, Ponn provided ACH transfer information to brokerage firms for accounts he opened on more than 350 occasions, totaling more than $8.5 million in attempted transfers. In each instance, the bank account Ponn provided did not have the amount of funds requested or, in some circumstances, did not even exist. Although the ACH transfers were rejected, the fraudulent transfers created the false appearance that the brokerage accounts had cash available to purchase securities.
Through this scheme, Ponn was allegedly able to purchase securities totaling more than $2.7 million in accounts at eight investment firms. When the firms discovered that the ACH transfers were rejected, they liquidated the securities in Ponn’s accounts.
The charge of wire fraud provides for a sentence of no greater than 20 years in prison, three years of supervised release and a fine of $1 million on each count. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
The U.S. Attorney’s Office received valuable assistance from the Securities and Exchange Commission, which filed suit today against Ponn arising out of the scheme to defraud investment firms.
United States Attorney Carmen M. Ortiz and Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Mark J. Balthazard of Ortiz’s Economic Crimes Unit.
The details contained in the complaint are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Arcade Man Sentenced on Drug ChargeRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051BUFFALO, N.Y.–U.S. Attorney William J. Hochul, Jr. announced today that Ryan Tojdowski, 32, of Arcade, NY, who was convicted of possession of a firearm in furtherance of a drug trafficking crime, was sentenced to 46 months imprisonment by U.S. District Judge Lawrence J. Vilardo.
Assistant U.S. Attorney Caleb J. Petzoldt, who handled the case, stated that on December 17, 2014, during the course of an investigation, the Wyoming County Sheriff’s Department discovered the defendant to be in engaged in the manufacturing and distribution of marijuana. In addition, deputies found Tojdowski to be in possession of quantities of oxycodone, morphine, alprazolam, hydrocodone, clonazepam, dihydrocodeine as well as a .223 assault rifle.
The sentencing is the culmination of an investigation on the part of the Wyoming County Sheriff’s Department, under the direction of Gregory J. Rudolph and the Drug Enforcement Administration, under the direction of Special Agent in Charge James J. Hunt, New York Field Office.Anchorage Man sentenced to 50 months in prison for drug trafficking crimeRead the Press Release
Anchorage, Alaska-U.S. Attorney Karen L. Loeffler announced today that an Anchorage man has been sentenced by Chief U.S. District Judge Timothy M. Burgess to serve 50 months in prison for his role in importing large quantities of methamphetamine into Anchorage from California.
Tori Dean LaFountain, 29, previously pled guilty to attempting to possess 270 grams of methamphetamine. As part of his guilty plea, LaFountain admitted that he was working with others to traffic methamphetamine. Specifically, he admitted that his role was to pick up packages of drugs when they arrived in Anchorage from California and then ensure that the packages were given to his associates for distribution.
According to Assistant U.S. Attorney Stephanie C. Courter, who prosecuted the case, LaFountain came to the attention of law enforcement in July 2015 after a box carrying 270 grams of methamphetamine was inadvertently delivered to the wrong address. After realizing the mistake, LaFountain went to the home hoping to retrieve the drugs. However, the homeowner had already called law enforcement about the incident.
During the sentencing hearing, the government noted that the methamphetamine LaFountain had attempted to retrieve had a street value of approximately $10,600. The government also noted that LaFountain had admitted to receiving three previous boxes of methamphetamine prior to being apprehended in July.
During the sentencing hearing, Judge Burgess characterized LaFountain as an important cog in the wheel that is drug distribution and remarked that LaFountain played an essential role in getting drugs to Alaska. Judge Burgess also stated that drug trafficking like LaFountain’s is “incredibly, inherently dangerous.” In pronouncing the sentence, Judge Burgess focused on the seriousness of the offense but also spoke about the need for people like LaFountain – an admitted drug user – to get treatment for their addiction.
U.S. Attorney Loeffler commended the work of the Drug Enforcement Administration (DEA), the Anchorage Police Department (APD), and the United States Postal Inspection Service (USPIS), who investigated the case.
Albuquerque Man Sentenced for Misdemeanor Conviction for Misbranding Drugs and Tobacco ProductsRead the Press Release
ALBUQUERQUE – Abdelrhman Barash, 37, of Albuquerque, N.M., was sentenced today in federal court to a year and a day in prison followed by one year of supervised release for misbranding drug or tobacco products.
Barash was charged in a criminal complaint with “spice” trafficking on Sept. 5, 2014, in Bernalillo County, N.M., based on a sale of synthetic cannabinoids to an undercover officer at Barash’s store, Snack & Smoke Shop at 2118 Central Ave. in Albuquerque. Thereafter, Barash was indicted and charged with distributing a controlled substance analogue on Sept. 5, 2014.
On Dec. 28, 2015, Barash pled guilty to a misdemeanor information charging him with two counts of delivering misbranded food, drugs, tobacco products, devices or cosmetics into interstate commerce. In entering the guilty plea, Barash admitted that on Sept. 5, 2014, he owned and worked at Snack & Smoke Shop and that on that date he introduced into interstate commerce at least two packages of a misbranded product.
This case was investigated by the Albuquerque office of the DEA and was prosecuted by Assistant U.S. Attorney Jennifer M. Rozzoni.
The controlled substances charged in the complaint and indictment are synthetic cannabinoids, commonly referred to as “spice.” According to the DEA, over the past several years, there has been a growing use of synthetic cannabinoids. Smoke-able herbal blends marketed as being “legal” and providing a marijuana-like high have become increasingly popular because they are easily available and, in many cases, more potent and dangerous than marijuana. These products consist of plant material that has been coated with dangerous psychoactive compounds that mimic THC, the active ingredient in marijuana. These substances, however, have not been approved by the Food and Drug Administration for human consumption, and there is no oversight of the manufacturing process. Synthetic cannabinoids often are labeled as incense to mask their intended purpose.
13 People Under Federal Arrest in Major Heroin and Gun Bust with Links to Philadelphia; Police Continue to Search for an Additional DefendantRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
ROCHESTER, N.Y.-U.S. Attorney William J. Hochul Jr. announced today 13 defendants have been arrested and charged by criminal complaint in a major heroin trafficking operation with links to Philadelphia, Pennsylvania. During the execution of search warrants following the arrests, law enforcement officers seized 22,713 decks of heroin, $93,399.00 in cash and nine firearms.Under arrest: • Damon Montgomery; • Herbert Montgomery; • Paris Montgomery; • Frank Figueroa; • James Washington; • Jonathan Figueroa; • Johnnie Balkman; • Robert Cochran; • Laron Perkins; and
• DeShawnra Williams, all of Rochester, NY.Also under arrest are Jerome Randolph, aka “May,” David Haynes and Edwin Rodriguez, all of Philadelphia, PA.
Law enforcement officers are continuing to search for a 14th suspect, Omar Latson.
“The seizures of heroin made in connection with this law enforcement operation represent some of the largest in recent memory,” said U.S. Attorney Hochul. “We in law enforcement don’t want further records, we want to save lives. Deaths from heroin and other opiate based substances now constitute the leading cause of death in America. But as a result of these seizures, nearly 23,000 potentially deadly doses will not make it onto the streets of our Rochester community.”
The charges in the complaint include possession with intent to distribute, and distribution of, controlled substances, conspiracy and attempt to possess with intent to distribute, and to distribute, controlled substances, use of a communication facility in furtherance of a controlled substance felony, money laundering and possession of a firearm in furtherance of drug trafficking. The charges carry a maximum penalty of life in prison, a fine of $10,000,000 or both.
Assistant U.S. Attorney Douglas E. Gregory, who is handling the case, stated that since October 2015, the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the Federal Bureau of Investigation (FBI), the Drug Enforcement Administration (DEA), and the Rochester Police Department (RPD) have conducted a multi-agency investigation into a significant Philadelphia based heroin trafficking organization. According to the complaint, the case involves the trafficking of large quantities of heroin from a group of individuals located in Philadelphia, PA to a group of individuals in Rochester. While the methods used by the organizations are not unique, the proceeds generated from the sale of heroin in Rochester over the course of the last several months have climbed well into the hundreds of thousands of dollars. The heroin seizures made in this case alone far exceed the total heroin seizures made in all of 2015 in the city of Rochester.
The investigation included the use of court approved eavesdropping warrants (wiretaps) on multiple phones used by the defendants. That investigation revealed that Jerome Randolph is the head of the Philadelphia group, responsible for overseeing the trafficking of heroin between Philadelphia and Rochester. Randolph relies principally on two named defendants, David Haynes and Edwin Rodriguez, who were responsible for the transportation of heroin and drug proceeds between the two cities. The Philadelphia group Supplied large quantities of pre-packaged and pre-stamped heroin, which was transported to Rochester in vehicles with hidden compartments. Once in Rochester, the heroin was distributed by members of the Rochester organization.
The Rochester organization had several principle members that deal directly with the members from Philadelphia, including Frank Figueroa, James Washington and Damon Montgomery. These individuals utilized several additional associates who performed various duties for the Rochester organization, including storage, transportation and street level distribution. These individuals were identified as Herbert Montgomery, Paris Montgomery, Johnnie Balkman, Robert Cochran, Jonathan Figueroa, Laron Perkins and LaShawnra Williams. Law enforcement officers estimate the Rochester organization was distributing in excess of $50,000 of heroin a week.447 THURSTON ROAD, APT 304
On March 5, 2016, investigators recovered a large quantity of heroin in an abandoned apartment controlled by Damon Montgomery. Specifically, investigators located 7,560 decks, or bags, of heroin weighing approximately 235 grams.
11 KARNES STREET
On March 11, 2016, during a traffic stop of Frank Figueroa, a search of his vehicle revealed a loaded Smith and Wesson revolver, 62 decks of heroin and 4.2 grams of powder cocaine, and $5,257 in cash.
440 THURSTON ROAD, Apt #108
On March 17, 2016, investigators executed a search warrant at the residence of Paris Montgomery. During the execution of the search warrant, investigators recovered two firearms, including a loaded Smith and Wesson 9mm, semi-automatic handgun and a Taurus, 45 caliber semi-automatic handgun, as well as 520 decks of heroin, numerous new, unused wax envelopes used in packaging heroin and $2,913 in cash.
909 SAINT BERNARD STREET, PHILADELPHIA, PA
On March 22, 2016, a search warrant was executed at the residence of David Haynes. Investigators located approximately $25,000 in United States currency, a loaded Ruger 9mm semi-automatic handgun, scales and 73 grams of heroin.
304 WEST ERIE AVENUE, PHILADELPHIA, PA
On March 22, 2016, a search warrant was executed at the residence of Edwin Rodriguez. Investigators located two handguns, including a loaded Bushmaster, .223 caliber rifle and a H&K 40 semi-automatic handgun, Ruger, 9mm semi-automatic handgun, approximately $6,000.00 in cash, and assorted ammunition.
2510 WEST DIAMOND STREET, PHILADELPHIA, PA
On March 22, 2016, a search warrant was executed at the residence of Jerome Randolph. Investigators located a large amount of ammunition and several loaded gun clips, scales, a money counter, a police scanner and approximately $3,000.
GOLD HONDA DRIVEN BY HAYNES/MONTGOMERY MEETING IN PA
On March 22, 2016, after intercepting numerous calls indicating a meeting would take place in northern Pennsylvania between two principal members of the organizations, a federal search and seizure warrant was executed on a car used to transport drugs and proceeds between Philadelphia and Rochester. Inside, investigators located two hidden containers (“traps”). The “trap” located under the center console was empty but the ‘trap” located under the rear passenger’s seat contained $46,950.00 cash and 13,440 decks (bags) of heroin.
89 ANGLE STREET
On March 22, 2016, a search warrant was executed at the residence of Robert Cochran. During the search, investigators located a loaded 410 gauge Mossburg shotgun, 27 decks of heroin, new and unused ziplock narcotics bags, a scale, approximately $2,339 in cash, an empty shoulder holster and assorted 45 caliber ammunition.
447 THURSTON ROAD, Apt #316
On March 22, 2016, a search warrant was executed at the residence of Johnnie Balkman. Investigators recovered 98 decks of heroin, a digital scale, a money counter, and $1,940.
97 MICHIGAN STREET
On March 22, 2016, a search warrant was executed at the residence of Jonathan Figueroa. Investigators recovered a Smith and Wesson 9mm semi-automatic handgun, a Kimber 45 caliber semi-automatic handgun and a small amount of heroin.
31 CANARY STREETOn March 22, 2016, a search warrant was executed at the residence of Deshawnra Williams. Investigators recovered nine decks of heroin, a digital scale and an assortment of paperwork.
Both Jerome Randolph and Edwin Rodriguez were arrested at their residences in Philadelphia, PA and were arraigned in Federal Court in Philadelphia, PA on Wednesday, March 23, 2016. The defendants are being held without bail pending their transfer to the Western District of New York.
The remaining defendants were arraigned before U.S. Magistrate Judge Jonathan W. Feldman. With the exception of DeShawnra Williams, all defendants are being held without bail at this time.
The criminal complaint is the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Delano A. Reid, New York Field Division, the Drug Enforcement Administration, under the direction of Special Agent in Charge James J. Hunt, New York Field Division, the Federal Bureau of Investigation, under the direction Special Agent in Charge Adam S. Cohen, U.S. Customs and Border Protection, Air and Marine Unit, under the direction of Brian Manaher, Director, Marine Operations, Immigration and Customs Enforcement, Enforcement and Removal Operations, under the direction Michael Phillips, Buffalo Field Office Director, U.S. Border Border Patrol, the Rochester Police Department, under the direction of Chief Michael Ciminelli, the Monroe County District Attorney’s Office, under the direction of Sandra Doorley, and the Greater Rochester Area Narcotics Enforcement Team (GRANET), and the New York State Department of Corrections and Community Supervision in coordination with the Philadelphia ATF and DEA Resident Offices and the Pennsylvania State Police.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
30 March 2016
Western Massachusetts Power Plant Owner and Management Companies Agree to Plead to Tampering and False Reporting; Operations & Maintenance Company Enters into Consent JudgmentRead the Press Release
BOSTON – Berkshire Power Plant’s owner and management company have agreed to plead guilty to tampering with emissions equipment and submitting false information to both environmental and energy regulators. The former plant operation and maintenance company also agreed to pay a state civil penalty.
United States Attorney Carmen M. Ortiz and Massachusetts Attorney General Maura Healey announced the resolution today following a joint federal and state investigation into allegations that Berkshire Power Plant in Agawam, Massachusetts tampered with its air pollution monitoring equipment and falsely reported data to environmental and energy regulators regarding its emissions levels and its availability to produce power.
“This resolution addresses a pattern of behavior by multiple persons and entities in obstructing the enforcement of laws designed to protect the air we breathe,” said United States Attorney Carmen Ortiz. “The comprehensive resolution, including the first ever criminal charges for false statements to the Federal Energy Regulatory Commission, demonstrates the seriousness with which we take conduct which undermines environmental compliance and the fair regulation of energy markets.”
“The deliberate scheme Berkshire Power Plant management and staff undertook gave them an unfair competitive advantage over responsible companies, and undermined a system that depends on honest data reporting,” said Tyler Amon, Special Agent in Charge of the U.S. Environmental Protection Agency’s Criminal Investigation Division in Boston. “Maximizing profit to minimize the cost of controlling pollution is placing greed over protecting nearby communities. EPA will continue to pursue cases that maintain data integrity, so we can do our job to protect clean air.”
“Fraud against the Commonwealth is very serious and will be aggressively prosecuted, criminally and civilly, by this Office, especially when the consequence of the fraud is to expose the public to health and safety risks,” said Massachusetts Attorney General Maura Healey. “This type of conduct can not be tolerated.”
“Reporting environmental information accurately is essential to state and federal efforts to improve air quality. Cases where information is misrepresented will be pursued to the fullest extent to protect the integrity of our air quality programs,” said MassDEP Commissioner Martin Suuberg. “Some of the funds generated by this settlement will support innovative programs to improve air quality in the Commonwealth, including the woodstove change-out and electric vehicle subsidy programs.”
Berkshire Power Co. (“BPC”), the owner of Berkshire Power Plant (“the Plant”), and Power Plant Management Services (“PPMS”) the Plant manager, agreed to plead guilty to felony charges that they violated and conspired to violate the federal Clean Air Act. These charges arose from air pollution monitoring equipment tampering and related false emissions reporting between 2009 and 2011. PPMS also agreed to plead guilty to charges that it violated the Federal Power Act, the first ever criminal charges under this statute, for making false statements to the regional power grid administrator, ISO-New England, regarding the Plant’s availability to produce power.
Under the terms of the plea agreements, BPC and PPMS agree to pay a total of $4.25 million related to the criminal charges. BPC will pay $2.75 million in criminal fines for the Clean Air Act violations and make a $750,000 community service payment to the American Lung Association to fund a program for the replacement of polluting wood burning stoves in western Massachusetts. PPMS will pay $500,000 in criminal fines for the Clean Air Act and Federal Power Act violations and make a $250,000 community service payment to the American Lung Association’s wood stove change-out program. The wood stove program payments would be established only after sentencing.
Between them, BPC, PPMS, and the Plant’s former operation and maintenance company, EthosEnergy Power Plant Services, LLC (formerly Wood Group Power Plant Services, LLC), will also pay over $4 million in civil penalties. EthosEnergy agreed to resolve allegations that it violated sections of the Commonwealth’s Public Health Law dealing with air pollution stemming from its employees’ involvement with the air pollution monitoring equipment tampering at the Plant. Under the terms of the state Consent Judgment, EthosEnergy will pay a $1.1 million civil penalty, and make a $200,000 payment to fund the installation of electric vehicle charging stations in the Commonwealth.
In addition to the criminal fines outlined above, BPC and PPMS have agreed to pay $3,042,563 plus interest to the Federal Energy Regulatory Commission in civil penalties and disgorgement for their misrepresentations to ISO-New England regarding the Plant’s availability to produce power.
According to documents filed in federal and state court, between January 2009 and March 2011, BPC engaged PPMS to manage the Plant, including overseeing day-to-day operations and maintenance and to act as the owner’s representative for the Plant.A PPMS employee served as the Plant General Manager and as BPC’s on-site representative.BPC also retained Wood Group during this same time to provide the day-to-day Plant operation and maintenance.
PPMS and BPC caused the Wood Group employees at the Plant to tamper with the Plant’s air pollution monitoring equipment to conceal the fact that the Plant was emitting air pollutants in excess of permitted levels.This tampering was accomplished by intentionally biasing the Plant’s Continuous Emissions Monitoring System so it would show lower emissions levels than were actually being produced by the Plant.BPC and PPMS then used this inaccurate data in filing required emissions reports with United States Environmental Protection Agency (“USEPA”) and the Massachusetts Department of Environmental Protection (“MassDEP”).The purpose of the tampering was to avoid lost revenues that would have resulted from reducing power production to stay within the Plant’s air pollution emissions limits, or by taking the Plant out of service to implement needed repairs of the Plant’s pollution control and other equipment.
Excess nitrogen oxide (“NOx“) emitted from fossil-fuel-burning power plants and mobile sources, like cars and trucks, combines in the atmosphere with volatile organic compounds emitted from industrial and residential sources to form ground-level ozone. At ground level, ozone is a respiratory pollutant that can cause many human respiratory effects, and even premature mortality, especially in vulnerable elderly persons and young children. NOx emissions also cause environmental damage to coastal waters, aquatic life, and other property, and contribute to the formation in the atmosphere of fine particulates that also harm humans, aquatic life, and vegetation.
During the course of the tampering investigation, criminal investigators also learned that PPMS made and caused staff at the Plant to make false statements to the ISO-New England, about the Plant’s availability to produce power for the New England grid. They also caused staff at the Plant to falsely claim to the ISO that the Plant was available to produce power when it was not. PPMS did this to maximize the Plant’s revenues and to minimize repair expenditures.
In February 2015, Ortiz’s office filed charges against Frederick Baker and Scott Paterson, respectively, a former Wood Group manager and instrument control technician at the Plant at the time the tampering occurred. It is alleged that Baker had, at the direction of the PPMS on-site General Manager, directed Wood Group employees at the Plant, including Paterson, to tamper with the Continuous Emissions Monitoring System. In light of the fact Wood Group spearheaded the disclosure of the tampering conduct to USEPA and MassDEP, and provided a high level of cooperation during the case, the case against EthosEnergy is being resolved with a civil settlement.
The federal criminal case is being prosecuted by Sara Miron Bloom of Ortiz’s Economic Crimes Unit and Daniel Licata, an Assistant Attorney General with the Massachusetts Attorney General’s Office working as a Special Assistant United States Attorney, with the assistance of Dianne Chabot, USEPA Criminal Enforcement Counsel.
The case was investigated by USEPA-CID, the Massachusetts Environmental Crimes Strike Force (an interagency investigative team dedicated to developing the most significant environmental enforcement cases) and the Massachusetts Environmental Police, with the technical assistance of attorneys, analysts and engineers from MassDEP and EPA Region 1.
The state civil case is being handled by Assistant Attorney General Frederick Augenstern of Attorney General Healey’s Environmental Protection Division, with assistance from attorneys from MassDEP’s Office of General Counsel, and engineers in MassDEP’s Boston Office.
The details contained in the criminal information and civil complaint are allegations. The defendants in the criminal cases are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law. By entering into the Consent Judgment, EthosEnergy does not admit to the truth of the allegations contained in the Complaint.
Warrensburg Man Indicted for Producing Child PornRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Warrensburg, Mo., man who was previously indicted for crossing state lines to engage in illicit sexual activity with a minor, was indicted by a federal grand jury today for producing and possessing child pornography.
Thomas Johnson, 22, of Warrensburg, was charged in a three-count superseding indictment returned by a federal grand jury in Kansas City, Mo. Today’s superseding indictment replaces an Oct. 14, 2015, indictment and includes additional charges. Johnson has remained in federal custody since his arrest.
In addition to the original charge of traveling across state lines in May 2015 to engage in illicit sexual conduct, the federal indictment also charges Johnson with using a minor to produce child pornography and with possessing child pornography.
The indictment also contains a forfeiture count, which would require Johnson to forfeit to the government any property used to commit the alleged offenses, including an ASUS laptop computer, a computer hard drive and a Nexus 6 cell phone.
According to an affidavit filed in support of the original criminal complaint, the investigation began in the Eastern District of Virginia when law enforcement agents were monitoring a child pornography Web site where Johnson had an account. Johnson allegedly logged onto the Web site and accessed images of child pornography.
Law enforcement officers executed a search warrant at Johnson’s residence on Sept. 25, 2015 and interviewed Johnson. Johnson’s cell phone was examined, the affidavit says, and was found to have several explicit photos of possible minor females, including a 13-year-old minor in Olathe, Kan. Johnson told law enforcement officers that he drove to Olathe to meet with the minor victim on two occasions in May 2015. This was confirmed in an interview with the minor victim, according to the affidavit, who also reported illicit sexual contact between herself and Johnson.
Dickinson cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Catherine A. Connelly. It was investigated by the FBI and the Olathe, Kan., Police Department.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Warren man indicted for mailing letter containing white powderRead the Press Release
A grand jury returned an indictment charging Anthony J. Natale, 37, of Warren, with one count of conveying false information related to the use of a weapon of mass destruction, said Carole S. Rendon, Acting U.S. Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland Office.
Natale mailed an envelope containing white powder via the United States Postal Service to American Business Center, at 7677 South Avenue, Youngstown, on November 10, 2014. This was done with the intent to convey false and misleading information related to the use of a weapon of mass destruction, according to the indictment.
Natale formerly worked at American Business Center. He was terminated on Oct. 6, 2014, according to court documents
“This defendant scared employees at his former workplace who opened an envelope containing white powder that they thought was a toxin,” Rendon said. “He caused panic, fire, police and HazMat units were forced to respond, and his former employer was forced to close their operations for more than two days. Mr. Natale will be held accountable for his actions.”
“There are appropriate, lawful avenues to express your displeasure at work, and inducing panic by sending what is believed to be a weapon of mass destruction is not one of them,” Anthony said. “The FBI will continue efforts to identify and protect the public from threats such as the one perpetrated by Mr. Natale.”
If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to his case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The case is being prosecuted by Assistant U.S. Attorney Justin Seabury Gould, and was investigated by the Federal Bureau of Investigation and Mahoning County Sheriff's Office.
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.
Warehouse Manager Ordered to PrisonRead the Press Release
LAREDO, Texas – The first of 20 defendants convicted in a conspiracy to possess with intent to distribute in excess of 1,000 kilograms of marijuana has been ordered to prison, announced U.S. Attorney Kenneth Magidson. A federal jury convicted Rafael Ortega aka Tio, 57, of Laredo, of one count of conspiracy and four counts of possession with intent to distribute in excess of 1,000 kilograms of marijuana on Nov. 3, 2015, following a three-day trial.
Today, U.S. District Judge Marina Garcia Marmolejo ordered he serve a total of 120 months in prison to be followed by five years of supervised release. In sentencing Ortega, the court took into consideration the evidence presented at trial which established Ortega was accountable for facilitating the transportation of more than 6,300 kilograms of marijuana from Sept. 24, 2011, to Aug. 27, 2012.
During trial, the government presented testimony from 13 witnesses and admitted more than 300 exhibits. Ortega was a warehouse manager in Laredo who, unbeknownst to his employer, made the building available to the Erasmo Trejo Nava drug trafficking organization for the loading and unloading of marijuana before and after business hours and on weekends. He received $3,000 on each occasion. Ortega allowed members of the drug organization to prepare the drug shipments using the warehouse and warehouse yard. A trailer would bring large wooden crates to the warehouse which were unloaded and readied for marijuana bundles to arrive from stash houses. As many as 138 bundles each weighing 20-40 pounds were unloaded at the warehouse and placed into the crates.
Surveillance showed Ortega meeting the co-conspirators at the warehouse and unlocking the gates to allow them access and entry. Testimony further revealed that Ortega used the warehouse forklift to assist the organization with unloading and loading of the crates into the trailers.
Evidence established that Ortega used his employer’s warehouse unload, load and transport approximately 6,394 kilograms of marijuana.
The warehouse in question had no knowledge of Ortega’s use of their warehouse for these illicit purposes. Ortega was a trusted employee who had been employed by the warehouse for more than 20 twenty years and had full access to the warehouse to include keys to the gates, office, warehouse doors and security codes.
Baltazar Ibarra Cardona, 55, of Nuevo Laredo, was also convicted at trial and is awaiting sentencing. He was one of several truck drivers used by the organization to transport marijuana from Laredo to Dallas.
The remaining 18 defendants had previously pleaded guilty and are also awaiting sentencing. Erasmo Abdon Trejo Nava, 44, Jose Angel Trejo, 43, Ovidio Rodriguez, 42, Victor Hugo Trejo Nava, 42, Francisco Colin, 42, and Salvador Saldaña-Medrano, 37, all of Laredo; Jaime Enrique Montalvo-Ruiz, 45, of Nuevo Laredo, Mexico; and Leocadio Ruiz, 48, of Dallas, entered pleas of guilty to conspiring to possess with intent to distribute more than 1,000 kilograms of marijuana and conspiracy to launder drug proceeds. Five others - Juan Manuel Vargas Aguilar, 46, Mario Albert Rodriguez, 30, and Ricardo Ramirez, 34, all of Laredo; Arturo Lozano, 48, of Dallas; and Joshua Sanchez, 33, of Nuevo Laredo – pleaded guilty to the conspiracy. Gerardo Moreno Recio, 49, of Nuevo Laredo, was convicted of two separate counts of possession with intent to distribute more than 100 kilograms of marijuana, while Laura Heredia Garcia, 51, of Nuevo Laredo; and Erika Alvarez, 39, Raquel Margarita Ramos Jimenez, 45, and Leslie Bernice Trejo, 23, all of Laredo, entered pleas of guilty to one count of conspiracy to launder drug proceeds.
The charges were the result of a long term Organized Crime Drug Enforcement Task Force Investigation dubbed Operation Trena Sin Trono spearheaded by the Drug Enforcement Administration, High Intensity Drug Trafficking Area Task Force and IRS - Criminal Investigation with the assistance of Homeland Security Investigations, Laredo Police Department, Zavala County Sheriff’s Office. Assistant U.S. Attorney Mary Lou Castillo is prosecuting the case.
Virginia executive sentenced to prison for bribes involving VA hospitalsRead the Press Release
A Virginia executive was sentenced to nearly three years in prison for providing things of value to the former director of the Cleveland and Dayton Veterans Affairs Medical Center in exchange for confidential information about VA construction projects, law enforcement officials said.
Mark S. Farmer, 55, of Arlington, Virginia, was convicted by a jury last year on one count of conspiracy, one count of violating the Hobbs Act, two counts of wire fraud, six counts of mail fraud and four counts of theft of government property.
U.S. District Judge Sara Lioi sentenced Farmer to 33 months in prison and fined him $12,500.
Farmer was employed at CannonDesign, an integrated design firm headquartered in Buffalo, New York, that performed work for the VA. He worked in several different capacities, including associate principal.
Farmer and CannonDesign received VA records and things of value, including non-public information concerning the VA and streamlined access to public information concerning the VA, which William Montague had embezzled and stolen without authority from the VA. This was done to give Farmer and CannonDesign an advantage over other companies in the awarding and administration of VA business, according to court documents and trial testimony.
Montague, the former director of the Cleveland and Dayton Veterans Affairs Medical Center, previously pleaded guilty to 64 counts related to his role in the conspiracy.
“Bribing a public official to obtain internal government documents and information for a competitive business advantage is illegal,” said Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland Office. “The FBI will continue to root out corruption at all levels.”
“This prison sentence shows VA contractors will be held accountable for defrauding our nation’s veterans,” said Gavin McClaren, U.S. VA OIG, Resident Agent in Charge, Cleveland.
Farmer asked Montague to obtain information concerning VA contracts and business, including VA records. Montague used his power and influence at the VA to gain access to VA employees in ways that Farmer could not. Montague gave false and misleading information to VA employees about Montague’s reasons for requesting VA records and information, according to court records and trial testimony.
The case was prosecuted by Assistant United States Attorneys Antoinette T. Bacon and Paul Flannery following an investigation by the FBI and United States Department of Veterans Affairs—Office of Inspector General.
Valencia County Man Sentenced to Prison for Violating Federal Firearms LawsRead the Press Release
ALBUQUERQUE – Tomas Torres, 31, of Peralta, N.M., was sentenced today in federal court in Albuquerque, N.M., to 92 months in prison for violating the federal firearms laws. Torres will be on supervised release for three years after completing his prison sentence.
Torres was arrested on Sept. 10, 2014, on an indictment charging him with being a felon in possession of a firearm and ammunition and possession of a firearm with an obliterated serial number on Jan. 11, 2014, in Valencia County, N.M. Torres was prohibited from possessing firearms or ammunition because he previously had been convicted of numerous felony offenses including, possession of heroin with intent to distribute, possession of heroin, commercial burglary, criminal damage to property and unlawful taking of a motor vehicle.
On Dec. 22, 2015, Torres pled guilty to the indictment and admitted that on Jan. 11, 2014, he possessed a handgun with an obliterated serial number which he tried to conceal in his mother’s vehicle when he found out police officers were searching for him. Torres further admitted that on Jan. 13, 2014, officers executed a search warrant on his vehicle and found approximately 20 rounds of ammunition inside the vehicle.
This case was investigated by the Albuquerque office of the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Peralta Police Department and the Los Lunas Police Department.
Assistant U.S. Attorneys Rumaldo R. Armijo and Edward Han prosecuted the case under a federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders primarily based on their prior criminal convictions for federal prosecution with the goal of removing repeat offenders from communities in New Mexico for as long as possible. Because New Mexico’s violent crime rate, on a per capita basis, is one of the highest in the nation, New Mexico’s law enforcement community is collaborating to target repeat offenders from counties with the highest violent crime rates, including Valencia County, N.M., under this initiative.
United States Attorney's Office Celebrates National Crime Victims' Rights Week, April 10-16Read the Press Release
Macon, GA —The Office for Victims of Crime (OVC) helps lead communities throughout the country in their annual observances of National Crime Victims’ Rights Week (NCVRW) every April by promoting victims’ rights, and honoring crime victims and those who advocate on their behalf. This year’s National Crime Victims’ Rights Week will be held April 10-16, and the theme—Serving Victims. Building Trust. Restoring Hope.—presents the opportunity to highlight the importance of providing needed services at the earliest stage of victimization. Early intervention helps prevent both further victimization and involvement in the criminal justice system, thus addressing the cycle of violence and restoring hope for the future.
The United States Attorney’s Office - Middle District of Georgia, in partnership with the Macon-Bibb County Sheriff’s Department, will observe National Crime Victims’ Rights Week with free self-defense classes open to the public on April 11 at Rosa Parks Square from 12 – 1 p.m. and 7:30 – 8:30 p.m. Guest presenter Paige Slocum with Safe Alone, Inc. will lead the first class.
“We are glad to be partnering with the Macon-Bibb Sheriff’s Department to offer these self-defense classes to the community,” Acting United States Attorney Pete Peterman said. “The U.S. Attorney’s Office is committed to protecting the rights of crime victims.”
National Crime Victims’ Rights Week honors and celebrates the achievements of the past thirty years in securing rights, protections, and services for victims. The bipartisan Victims of Crime Act (VOCA), passed by Congress in 1984 created a national fund to ease victims’ suffering. Financed by fines and penalties paid by offenders, the Crime Victims Fund supports services for victims of all types of crime, including assistance for homicide survivors, survivors of child sexual abuse and victims of human trafficking as well as rape crisis centers and domestic violence programs among others. VOCA also funds victim compensation programs that pay victims’ out-of-pocket expenses such as counseling, funeral expenses, and lost wages.
“If victims are to trust that the criminal justice system will work for them, we must meet them where they are—physically, culturally, and emotionally,” said Joye E. Frost, Director, Office for Victims of Crime (OVC), U.S. Department of Justice. “When we take the time to focus on the victim in the aftermath of crime—to address their needs for safety and justice—we can begin to build trust and restore the hope of those victims and their communities. We all play a role in helping victims as they rebuild their lives.”
OVC encourages widespread participation in the week’s events and in other victim-related observances throughout the year. The U.S. Department of Justice will host OVC’s annual Service Awards Ceremony on Tuesday, April 12, in Washington, DC, to honor outstanding individuals and programs that serve victims of crime. For additional information about this year’s National Crime Victims’ Rights Week and how to assist victims in your community, please contact Cathy Barnes, Victim/Witness Coordinator at the United States Attorney’s Office – Middle District of Georgia, at 478-621-2634. For additional ideas on how to support victims of crime, visit the Office for Victims of Crime website, www.ovc.gov.
U.S. Attorney Barry Grissom Announces Elder Justice Task Force in KansasRead the Press Release
KANSAS CITY, KAN. – U.S. Attorney Barry Grissom announced today he is launching an Elder Justice Task Force in Kansas. The task force in Kansas – one of 10 across the country -- will bring federal prosecutors and law enforcement agencies together with state and local agencies to target nursing homes that provide grossly substandard care to residents.
“We already have one investigation open,” Grissom said. “We’re not wasting time.”
Grissom said the members of the task force at this time include the Department of Justice Civil Fraud Section, Health and Human Services - Office of Inspector General and the Kansas Medicaid Fraud Control Unit. Later, he said, he expects to invite state agencies that work with long term care, public health and aging to join.
Steve Hanson, Special Agent in Charge of the Kansas City Regional Office of U.S. Department of Health and Human Services, Office of Inspector General, stated, “Our office is excited to join forces with our federal, state, and local partners to identify nursing homes that are providing substandard quality of care to our elderly beneficiaries.”
In Washington, D.C., Acting Associate Attorney General Stuart F. Delery said, “Millions of seniors count on nursing homes to provide them with quality care and to treat them with dignity and respect when they are most vulnerable. Yet, all too often we have found nursing home owners or operators who put their own economic gain before the needs of their residents. These task forces will help ensure that we are working closely with all relevant parties to protect the elderly.”
Elder Justice Task Forces also are being launched by U.S. Attorneys in the following districts: Northern District of California, Northern District of Georgia, Western District of Kentucky, Northern District of Iowa, District of Maryland, Southern District of Ohio, Eastern District of Pennsylvania, Middle District of Tennessee and the Western District of Washington.
Kansas was chosen, Grissom said, because we have expertise in investigations and prosecutions of nursing homes and we made a commitment to working together with stand and local agencies.
The Elder Justice Task Forces reflect the Justice Department’s larger strategy and commitment to protecting our nation’s seniors, spearheaded by the Department’s Elder Justice Initiative. The Elder Justice Initiative coordinates and supports the Department’s law enforcement efforts and policy activities on elder justice issues. It plays an integral role in the Department’s investigative and enforcement efforts against nursing homes and other long-term care entities that deliver grossly substandard care to Medicare and Medicaid beneficiaries. The Elder Justice Initiative will be providing litigation support and training to the Elder Justice Task Forces. Learn more about the Justice Department’s Elder Justice Initiative at http://www.justice.gov/elderjustice/.
Two Time Convicted ATM Thief Sentenced to 44 Months in PrisonRead the Press Release
Baltimore, Maryland – Chief U.S. District Judge Catherine C. Blake sentenced Tracy Delong Fletcher, a/k/a “Sean Fletcher,” “Sean Chappelle Fletcher” and “Benjamin Thomas,” age 39, of New Carrollton, Maryland today to 44 months in prison followed by three years of supervised release for conspiring to commit bank larceny, and for violating his supervised release arising from a previous bank larceny conviction. Chief Judge Blake also ordered Fletcher to forfeit and pay $100,000 in restitution.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation, Baltimore Field Office; Chief J. Thomas Manger of the Montgomery County Police Department; and Frederick County Sheriff Charles A. “Chuck” Jenkins.
According to his plea agreement, from January 5, 2012 to May 7, 2013, Fletcher and his co-conspirators stole vehicles used to commit the larcenies, obtained tools to open ATMs and caused damage to bank property in order to commit bank larcenies.
More specifically, on February 21, 2013, Frederick County police officers responded to a commercial burglary alarm at a rental shop in Frederick. Upon arrival, they saw a man run from the front of the business and enter a van. The van struck a patrol car as it fled the area. Police chased the van, which reached a speed of 100 mph. After driving through ditches and avoiding law enforcement efforts to disable the van, the occupants jumped out as the van was in gear and attempted to run away. Officers apprehended Fletcher and another individual. Fletcher initially gave officers the false name “Benjamin Thomas.” Fletcher was wearing dark clothing and gloves, and also had a black mask. The ignition switch of the van had been damaged. Also in the van were three chain saws and three cut saws, which had been stolen from the rental business.
On May 7, 2013, police officers were called to a bank branch in Potomac, Maryland. An individual saw three men forcibly removing the ATM using a front end loader and a chain, causing approximately $100,000 in damages. They then attempted to put the ATM into a stolen truck. Officers arrived and the individuals fled on foot.
A review of cell phone records revealed that Fletcher made multiple calls around this time using a cell tower in the area of the bank. Shortly after these calls were made and using the false name “Sean Fletcher,” Fletcher arrived at a hospital in Prince George’s County where he was treated for a deep laceration to his hand.
Fletcher was previously convicted of bank larceny in federal court in Maryland and sentenced to 70 months in prison. After serving his sentence and while on supervised release for his previous conviction, he conspired to commit the bank larceny described above.
United States Attorney Rod J. Rosenstein praised the FBI, Frederick County Sheriff’s Office and Montgomery County Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Thomas M. Sullivan, who prosecuted the case.
Two Men Sentenced for Failing to Register as Sex OffendersRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that two men were sentenced in federal court today, in separate and unrelated cases, for failing to register as sex offenders after moving to St. Robert, Mo., and Branson, Mo.
USA v. Dixon
Anthony Lovon Dixon, 44, of St. Robert, Mo., was sentenced by U.S. District Judge Roseann Ketchmark to two years and six months in federal prison without parole. Today’s sentencing is the maximum penalty recommended under the federal sentencing guidelines. The court also sentenced Dixon to 10 years of supervised release following incarceration.
On Nov. 5, 2015, Dixon pleaded guilty to failing to register or update his registration as required by the Sex Offender Registration Notification Act. Dixon, who was convicted in the state of Georgia in 2002 for sexually molesting an 11-year-old victim, traveled from Georgia and lived in Missouri for six months.
Even though he was previously convicted of failure to register as a sex offender in Georgia and was informed that he had to maintain his registration, Dixon left the state without notifying anyone and move to a new state. Upon arriving in Missouri, Dixon failed to register as a sex offender or notify law enforcement of his presence within the state so he could be properly monitored.
According to court documents, Dixon has been convicted on nine separate occasions for 11 separate criminal offenses. With the exception of the child molestation case, where he was given a three-year sentence of incarceration followed by a seven-year sentence of probation, each and every other court has sentenced Dixon to probation.
Dixon was convicted in Georgia in 2009 of failure to comply with the state sex offender registry and sentenced to 10 years of probation. Since then, according to court records, Dixon has violated his probation four additional times and has been reinstated to probation each time. In addition to using drugs and violating the court’s orders while on this probation, at least two of Dixon’s violations were due to his continued failure to register as a sex offender.
This case was prosecuted by Assistant U.S. Attorney Patrick Carney. It was investigated by the U.S. Marshals Service.
USA v. Parker
Lance L. Parker, 25, who is from Delaware but had been staying at a hotel in Branson, Mo., at the time of his arrest, was sentenced by U.S. District Judge Roseann Ketchmark to 23 months in federal prison without parole. The court also sentenced Parker to 10 years of supervised release following incarceration.
On Nov. 10, 2015, Parker pleaded guilty to failing to register or update his registration as required by the Sex Offender Registration Notification Act.
Parker was convicted in 2009 in the state of Delaware of rape. He escaped from Morris Correctional Community Center in Dover, Del., on April 28, 2015, and fled the state with his girlfriend. They traveled to Missouri and stayed at a Branson motel for nearly a month before attempting to drive to Las Vegas. When their car broke down in New Mexico, they returned to Branson and stayed at a couple of different motels until Parker was arrested on June 22, 2015.
This case was prosecuted by Assistant U.S. Attorney Abram McGull, II. It was investigated by the U.S. Marshals Service, the Branson, Mo., Police Department and the Taney County, Mo., Sheriff’s Department.
Two KC Men Indicted for Armed Bank Robbery, Illegal FirearmsRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that two Kansas City, Mo., men were indicted by a federal grand jury today for armed bank robbery and for illegally possessing firearms.
Gregory Burgin, 58, and his stepson, Howard T. Patton, 37, both of Kansas City, were charged in a four-count indictment returned by a federal grand jury in Kansas City, Mo. Today’s indictment replaces a federal criminal complaint that was filed against Burgin on March 14, 2016, adds Patton as a defendant and includes additional charges.
The federal indictment alleges that Burgin and Patton aided and abetted each other to steal $8,142 at gunpoint from Bank Midwest, 6429 Brookside Blvd., Kansas City, Mo., on March 12, 2016. They are also charged with aiding and abetting each other to brandish firearms during a crime of violence.
Burgin and Patton, who have been convicted of felonies, are each charged with one count of being a felon in possession of firearms and ammunition. Burgin allegedly was in possession of a Kel Tech 9mm pistol, a Bersa .380-caliber pistol and ammunition. Patton allegedly was in possession of a Bersa .380-caliber pistol and ammunition.
According to an affidavit filed in support of the original criminal complaint, Burgin and Patton were both armed with handguns, which were pointed at the tellers and customers, when they entered the bank. One of them grabbed a customer from behind, the affidavit says, and pushed him to the ground before pointing a handgun directly at a teller. He demanded money and cocked the hammer on his handgun to intimidate her. They ordered an employee and customer to the ground. The teller placed the money in a duffle bag and they fled from the bank.
Police officers saw a vehicle parked in Burgin’s driveway about half an hour later that matched the description of the get-away car. Inside Burgin’s residence, officers found a Crown Royal bag in the rafters that contained $8,155, as well as firearms and clothing items matching the description of what the bank robbers were wearing.
Dickinson cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Rudolph R. Rhodes, IV. It was investigated by the Kansas City, Mo., Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives and the FBI.
Trade Show Manager Pleads Guilty to Defrauding his EmployerRead the Press Release
PITTSBURGH – An Allegheny County resident pleaded guilty in federal court to charges of mail fraud, United States Attorney David J. Hickton announced today.
Anthony Allen Aubrey, 50 of White Oak, PA, pleaded guilty to one count before United States District Judge Nora Barry Fischer.
In connection with the guilty plea, the court was advised that Aubrey was a trade show manager for Phillips Home Healthcare Solutions (PHHS) responsible for setting up venues and hiring vendors for everything from carpentry to food. He had a good working relationship with Carpenter Connection (CC) and at Aubrey’s request CC would pay vendors and individuals on behalf of PHHS who could not be easily paid through the PHHS system due to timing and administrative issues. In turn CC would be reimbursed by PHHS. Aubrey developed a relationship with Melissa Dougherty and hired her to assist with some of the trade shows. However, the relationship became romantic and Aubrey began to request additional payments for her for services she did not perform or had already been paid for. He created and/or inflated Dougherty’s invoices on his company laptop to support the fraudulent payments. He asked CC by email to issue checks to her and have them overnighted by FedEx. One of those checks forms the basis for Count One. When an audit revealed discrepancies and Aubrey was questioned, he admitted what he had done and cooperated fully. The loss to PHHS was $376,603.
Judge Fischer scheduled sentencing for July 29, 2016. The law provides for a total sentence of 20 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Nelson P. Cohen is prosecuting this case on behalf of the government.
The United States Postal Inspection Service conducted the investigation that led to the prosecution of Anthony Allen Aubrey.
Three Sets of Father and Son Among More Than 15 Defendants Charged with Dealing Cocaine and Heroin in Chicago and Surrounding SuburbsRead the Press Release
CHICAGO — More than 15 defendants, including three fathers and their sons, are facing federal or state drug charges for their alleged roles in dealing wholesale amounts of heroin and cocaine in Chicago and surrounding suburbs, authorities announced today.
During the course of the investigation, dubbed “Operation Chicago Storm,” law enforcement agents assigned to the Chicago Strike Force seized more than 100 kilograms of cocaine, nine kilograms of heroin, 14 firearms and $600,000 in narcotics proceeds. Authorities uncovered the criminal activity through the use of wiretapped cellular phones, cooperating witnesses and extensive surveillance.
Fourteen federal defendants were arrested in the past week. Two state defendants have been charged in separate complaints filed in state court.
According to federal criminal complaints and affidavits unsealed after the arrests, the investigation revealed that JULIO MARTINEZ SR. and his son, JULIO MARTINEZ JR., trafficked kilogram quantities of heroin and cocaine in the Chicago area, primarily on the Northwest Side of the city. EDWIN DEL VALLE, also known as “Chino,” worked with the Martinezes to supply the narcotics to wholesale customers, the affidavits state. Del Valle allegedly stashed the narcotics in a garage in the Portage Park neighborhood of Chicago.
Martinez Sr., 54, of Lawrenceville, Ga.; Martinez Jr., 32, of Chicago; and Del Valle, 38, of West Columbia, S.C., are each charged with one count of conspiracy to knowingly and intentionally possess with intent to distribute heroin, and one count of knowingly and intentionally possessing cocaine with the intent to distribute.
Two other sets of father and son were also charged as part of the investigation. JUVENAL MARTINEZ, 66, and his stepson, ISRAEL MARTINEZ, also known as “Chino,” 32, both of Plainfield, were charged with participating in a conspiracy to distribute cocaine. Also charged in a cocaine-dealing conspiracy were PHILLIP VEGA, also known as “Moose,” 42, of Berwyn, and his son, JACOB VEGA, 24, of Chicago.
Strike Force agents executing a search warrant as part of the investigation discovered a Glock 17 semiautomatic handgun in the home of Phillip Vega. The search also uncovered 56 rounds of ammunition, 60 grams of cocaine, and a digital scale, according to the affidavits.
Throughout the course of the investigation, authorities surreptitiously recorded numerous drug transactions, including one near the Kennedy Expressway at Armitage Avenue in Chicago. More than 140 grams of cocaine was allegedly sold in that deal by NICHOLAS PADIN, 28, of Chicago, who is charged with both the conspiracy and the possession with intent to distribute.
The charges were announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Dennis A. Wichern, Special Agent in Charge of the Chicago Field Division of the Drug Enforcement Administration; Eddie T. Johnson, Interim Superintendent of the Chicago Police Department; Anita Alvarez, Cook County State’s Attorney; and James D. Robnett, Special Agent-in-Charge of the Internal Revenue Service Criminal Investigation Division.
The investigation was conducted through the U.S. Organized Crime Drug Enforcement Task Force (OCDETF) Chicago Strike Force, which ― in addition to the DEA, IRS-CID and CPD narcotics officers ― consists of U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI), the FBI, the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives, the U.S. Marshals Service, and task force officers from various state and local law enforcement agencies, including the Cook County Sheriff’s Police and the Illinois State Police.
Also charged in the complaints with participating in a conspiracy to distribute heroin are JOSE RIVERA, 56, of Chicago; and MAURICE HART, also known as “Mo,” 46, of Chicago.
Charged with participating in a conspiracy to distribute cocaine are ADAM AGUIAR, 41, of Chicago; CHARLES MEDINA, 32, of Chicago; and LUIS MONTES, also known as “Nene,” 47, of Chicago.
The complaints charged LUIS NOCE, also known as “Guido,” 32, of Berwyn, with knowingly possessing cocaine with the intent to distribute.
The public is reminded that complaints contain only charges and are not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Assistant United States Attorneys Christopher J. Stetler and Sean K. Driscoll are representing the government in the federal cases. Assistant Cook County State’s Attorney Bronwyn Sears is prosecuting the state cases.
Montes and Padin Complaint and Affidavit
Martinez Israel/Juvenal Complaint
Vega Phillip/Jacob Complaint and Affidavit
Noce Complaint
Aguiar and Medina Complaint
Supervisor of D.C. Water and Sewer Authority Pleads Guilty to Conflict of Interest ChargeRead the Press Release
WASHINGTON – A supervisor with the District of Columbia Water and Sewer Authority pled guilty today to a federal conflict-of-interest charge for approving permits for work applications prepared by his own private company, announced U.S. Attorney Channing D. Phillips, Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office, and Daniel W. Lucas, Inspector General for the District of Columbia.
Londra S. Watson, 53, of Washington, D.C., pled guilty in the U.S. District Court for the District of Columbia to a felony charge of criminal conflict of interest. The charge carries a statutory maximum of five years in prison and potential financial penalties. Under federal sentencing guidelines, Watson could face up to six months of incarceration and a fine. The Honorable Senior Judge Thomas F. Hogan scheduled sentencing for June 27, 2016.
According to the government’s evidence, Watson started work in 1981 for the D.C. Water and Sewer Authority (“D.C. Water”). At the time of the offenses, he was the agency’s supervisor of documents and permits. His responsibilities included, among other things, supervising the processing of permit applications from applicants seeking to alter and make modifications to existing plumbing connections from D.C. Water lines to existing structures.
In November of 2007, Watson started a company named Ardnol of DC LLC. Starting that month and continuing to February 2012, applicants seeking permits from D.C. Water provided checks totaling $141,066 to Watson’s company. In return, the firm was to assist them in preparing design plans, permit applications, plumbing plans, and utility plans, as well as D.C. Water “permit expediting” services. Many permit applicants were referred to Watson’s company by former clients who already had their permits approved by D.C. Water with the assistance of Ardnol of DC. Once an applicant contacted his company, Watson advised that he would draft the complete permit package, including the necessary site plans and diagrams, and assured the applicant that the permit application would comply with format requirements and protocols.
Once the applicant paid Ardnol of DC its required fee, Watson prepared the complete permit package and delivered it to the client. The client then submitted the permit application to D.C. Water for approval. In his official capacity as a supervisor in the permit office, Watson approved, directly or indirectly through his subordinates, applications and issued D.C. Water permits to a number of applicants who were clients of his company. He intentionally failed to disclose his financial interest in the company to D.C. Water.
In announcing the plea, U.S. Attorney Phillips, Assistant Director in Charge Abbate, and Inspector General Lucas commended the work of those who investigated the case from the FBI’s Washington Field Office and the District of Columbia Office of the Inspector General. They also expressed appreciation for the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialist Kristy Penny, Legal Assistant Angela Lawrence, and Assistant U.S. Attorneys Lionel André and Michelle N. Bradford, who are prosecuting the case.
Southern District of Ohio 1 of 10 Regional Elder Justice Task Forces Launched by Department of JusticeRead the Press Release
WASHINGTON – Today, the Department of Justice announced that the Southern District of Ohio will serve as one of 10 regional Elder Justice Task Forces. These teams will bring together federal, state and local prosecutors, law enforcement, and agencies that provide services to the elderly, to coordinate and enhance efforts to pursue nursing homes that provide grossly substandard care to their residents.
“We’re honored to be selected as one of the regional task forces,” Acting U.S. Attorney Benjamin C. Glassman said. “Our designation highlights the great, collaborative work already underway here with local, state, and federal partners, and our District’s commitment to protecting our most vulnerable citizens.”
The Elder Justice Task Forces will include representatives from the U.S. Attorneys’ Offices, state Medicaid Fraud Control Units, state and local prosecutors’ offices, the Department of Health and Human Services (HHS), state Adult Protective Services agencies, Long-Term Care Ombudsman programs and law enforcement.
The 10 Elder Justice Task Forces will be launched in the following Districts: Northern District of California, Northern District of Georgia, District of Kansas, Western District of Kentucky, Northern District of Iowa, District of Maryland, Southern District of Ohio, Eastern District of Pennsylvania, Middle District of Tennessee and the Western District of Washington.
“Millions of seniors count on nursing homes to provide them with quality care and to treat them with dignity and respect when they are most vulnerable,” said Acting Associate Attorney General Stuart F. Delery. “Yet, all too often we have found nursing home owners or operators who put their own economic gain before the needs of their residents. These task forces will help ensure that we are working closely with all relevant parties to protect the elderly.”
The Elder Justice Task Forces reflect the Department’s larger strategy and commitment to protecting our nation’s seniors, spearheaded by the Department’s Elder Justice Initiative. The Elder Justice Initiative coordinates and supports the Department’s law enforcement efforts and policy activities on elder justice issues. It plays an integral role in the Department’s investigative and enforcement efforts against nursing homes and other long-term care entities that deliver grossly substandard care to Medicare and Medicaid beneficiaries. The Elder Justice Initiative will be providing litigation support and training to the Elder Justice Task Forces. Learn more about the Justice Department’s Elder Justice Initiative at http://www.justice.gov/elderjustice/.
Second Round of Arrests Made in Clinton-Based Drug Trafficking Organization;123 Pounds of Methamphetamine Seized in OperationRead the Press Release
LITTLE ROCK—Christopher R. Thyer, United States Attorney for the Eastern District of Arkansas, along with Matthew Barden, Assistant Special Agent in Charge of the Drug Enforcement Administration (DEA), 20th Judicial District Prosecuting Attorney Cody Hiland, Van Buren County Sheriff Scott Bradley, and Faulkner County Sheriff Matt Rice announced today a second round of arrests in Operation Ice Storm, an investigation into drug trafficking in Van Buren County. The early-morning raid led to arrests of 18 federal defendants and 20 state defendants on charges involving conspiracy to possess with intent to distribute methamphetamine, distribution of methamphetamine, and use of a communication facility to facilitate drug trafficking.
Eighteen of the 19 defendants named in a federal indictment are in custody, with one defendant still at large in California. Three of the federal defendants were already in state custody on separate charges, and eight state defendants are still at large. United States Magistrate Judge J. Thomas Ray will hold initial appearances for the federal defendants on Thursday.
"While standing on the courthouse steps in Clinton in 2014 after the arrests in the first phase of Operation Ice Storm, I vowed that my office would continue to combat the drug trafficking problem in Clinton and Van Buren County, and today’s arrests mark our commitment to that vow," Thyer said. "Methamphetamine continues to ruin countless lives and families every day. Our efforts in taking this drug off the street are unwavering, and we will continue to work with all law enforcement agencies to remove the individuals responsible for distributing methamphetamine to our communities."
"Today we have dismantled multiple drug-trafficking groups who have been responsible for bringing significant amounts of methamphetamine from Mexico into several communities in central Arkansas," Barden continued. "The DEA, working with our federal, state and local law enforcement partners, are committed to bring to justice those organizations that continue to damage and pollute our communities with drugs for profit."
Operation Ice Storm began in January 2011 with an investigation into Jeffery Weaver and multiple other co-conspirators. The first phase of Operation Ice Storm resulted in the arrests of 54 defendants on state and federal charges on September 24, 2014. Out of the 34 defendants who were arrested on federal charges, 21 have pleaded guilty or are scheduled to plead guilty, and two remain fugitives (James Knott and Isaac Jauregui-Estrada). As a result of this first phase, law enforcement determined that Anthony Silva, Wesley Harrison, Trey New, and the other named co-defendants were also responsible for distributing large quantities of methamphetamine in the Van Buren County area.
During the second phase of Operation Ice Storm investigators used numerous law enforcement actions, including multiple undercover operations and court-authorized Title III wiretaps. All told, the second phase of Operation Ice Storm resulted in the seizure of approximately 123 pounds of methamphetamine, one pound of heroin, multiple firearms, and approximately $138,000 in drug proceeds. The defendants charged are responsible for distributing or possessing hundreds of pounds of methamphetamine in Van Buren County.
In Wednesday morning’s operation, approximately 8.5 pounds of methamphetamine, 52 grams of heroin, 16 firearms, and $24,085 in drug proceeds were seized.
"This operation represents the important work our drug task force agencies do on a daily basis," Hiland said. "It also reflects what can happen when you have a good working relationship with your federal counterparts and other agencies."
The federal indictment, unsealed today, was handed down by a Grand Jury on March 2, 2016. The indictment charges 19 defendants in 15 separate counts. The counts include conspiracy to possess with intent to distribute more than 500 grams of methamphetamine, distribution of methamphetamine, and the use of telephone to facilitate a drug trafficking crime.
If convicted of conspiracy to distribute more than 500 grams of methamphetamine each defendant will face a sentence of not less than 10 years to life imprisonment.
The investigation and prosecution of this case is a coordinated effort through the David G. Wilhelm OCDETF Strike Force and the High Intensity Drug Trafficking Areas (HIDTA), and was conducted by the DEA and the 20th Judicial District Drug Task Force with assistance from several law enforcement agencies including the Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF), Arkansas State Police, 16th Judicial District Drug Task Force, and the Central Arkansas Drug Task Force. The case is being prosecuted by Assistant United States Attorneys Kristin Bryant and Liza Jane Brown.
An indictment contains only allegations. A defendant is presumed innocent unless and until proven guilty.
Second Phase Of Operation Ice Storm - Federal Defendants_Charges
San Gabriel Valley Wholesale Executive Pleads Guilty for Role in $9 Million Bank Fraud SchemeRead the Press Release
LOS ANGELES – A San Dimas man who was a vice president of an Ontario-based wholesale equipment company pleaded guilty today to federal charges in connection with a bank fraud scheme that resulted in more than $9 million in losses to a California bank.
Chung Yu Yeung (also known as Louis Yeung), 39, pleaded guilty before United States District Judge Christina A. Snyder to one count of conspiracy to commit bank fraud and four counts of bank fraud. Sentencing was set for June 20 before Judge Snyder.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Eileen M. Decker, Acting Special Agent in Charge Anthony Orlando of IRS Criminal Investigation’s Los Angeles Field Office, Special Inspector General for the Troubled Asset Relief Program (SIGTARP) Christy Goldsmith Romero and Assistant Director in Charge David Bowdich of the FBI’s Los Angeles Field Office made the announcement.
According to admissions made in connection with his guilty plea, from 2007 to 2012, Yeung was the vice president of Eastern Tools and Equipment Inc. (Eastern Tools), a wholesale equipment company based in Ontario, California, that sold portable generators to retailers across the country. Yeung admitted that beginning in 2007, he and his co-conspirators defrauded the Pasadena-based East West Bank in connection with a line of credit for Eastern Tools by making and causing to be made material misrepresentations to the bank about Eastern Tools’ accounts receivable and its financial statements. The conspirators created numerous shell corporations to act as purported suppliers and retailers doing business with Eastern Tools, when, in reality, these shell corporations were entirely under the control of Yeung and existed for the sole purpose of creating the illusion of such business, he admitted. Yeung admitted that the fictitious companies allowed him and other conspirators to falsely inflate Eastern Tools’ accounts receivable and financial statements in representations to East West Bank.
To further the scheme, Yeung and other conspirators opened and caused to be opened post office boxes, phone accounts and email accounts purportedly associated with the shell retail companies, and provided information about these items to East West Bank auditors to promote the illusion that these shell customers were independent entities, according to admissions made in connection with the plea agreement.
Eastern Tools defaulted on the promissory note after East West Bank discovered the fraud, causing more than $9 million in losses to the bank, according to Yeung’s admissions.
“This defendant went to great lengths to create the illusion of business that defrauded the victim bank out of millions, but law enforcement was able to penetrate the illusion,” said United States Attorney Eileen M. Decker. “Crimes like these can threaten the stability of our financial institutions and therefore our national economy.”
SIGTARP, IRS Criminal Investigation and the FBI investigated the case. Senior Litigation Counsel David A. Bybee of the Criminal Division’s Fraud Section is prosecuting the case.
Retired Boston Police Officer Detective Pleads Guilty for His Role in an Investment Fraud SchemeRead 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 Daniel Rice, 53, of Stoughton, Massachusetts, pleaded guilty to wire fraud before U.S. Senior District Judge William M. Skretny.
Assistant U.S. Attorneys Scott S. Allen Jr. and Mary Catherine Baumgarten, who are handling the case, stated that Rice, a retired City of Boston Police Detective, aided and abetted Michael Wilson, 29, formerly of Hamburg, NY, to defraud investors by promising large returns on phantom investments through companies known as New Frontier.Rice pleaded guilty for his involvement in a deal brokered in January 2010, in which the defendant induced a Montana broker to wire $100,000 as part of a phony investment with Zodiak Capital, one of Wilson’s fraudulent New Frontier companies. Rice kept $40,000 before passing the remaining $60,000 on to a Wilson account at HSBC Bank in Buffalo.
In July 2010, Rice was involved in a second deal with Zodiak, and failed to tell the Montana broker about Zodiak’s connection to Wilson’s companies. As a result, on July 15 and 19, 2010, a total of $71,875 of a different investor’s money was wired to accounts in the Buffalo area controlled by Zodiak. The only money recovered was the $71,875 wired to Zodiak in July 2010, because the government quickly applied to have the receiving bank accounts frozen. The funds eventually were returned to the investor, who lives in Utah.
Wilson is currently charged in a 47 count indictment with wire fraud, money laundering and conspiracy, for deals entered into by his fraudulent companies in 2008 through 2010. The indictment accuses Wilson of attempting to defraud investors out of more than $8,000,000 between June 2008 and July 2009 by creating several phantom investment companies known collectively as New Frontier, including such names as Zodiak, Carnic LLC, Phantom Holdings and others, all purportedly located at 6553 Boston State Road in Hamburg. Wilson thereafter induced individuals and companies to invest in financial instruments with complex sounding names such as leveraging agreements that promised high-yield earnings and returns in short periods of time.
Rather than investing clients’ money, Wilson spent it on a variety of personal items, including $2,500,000 as a down payment for Boston State Road properties, automobiles - including a Hummer, a Corvette, two Land Rovers, and a Mercedes ML 500, artwork, and other items. The Indictment also discloses that in January 2009, Wilson paid $1,800 to hire an actor from a talent agency to portray a person using the name of an alias (George Possiodis), which name and persona the defendant used during his scheme.
Soon before being indicted, Wilson fled to Canada and is currently evading law enforcement authorities. The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
Rice’s sentencing is scheduled for July 13, 2016 at 10 a.m. before Judge Skretny.
The plea is the result of an investigation by the Federal Bureau of Investigation, under the direction of Special Agent in Charge Adam S. Cohen, with assistance from the Boston Police Department Anti-Corruption Division.