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Wednesday 20 January 2016
Two San Jose Men Sentenced to Prison for Posting Information About A Minor Online to Solicit Sex CustomersRead the Press Release
SAN JOSE- Two San Jose residents were sentenced to approximately five years in prison yesterday for posting information about a minor under the age of 16 on the Internet in order to solicit prostitution customers, announced Acting United States Attorney Brian Stretch and FBI Special Agent in Charge David Johnson. Justin Everett Crutchfield was sentenced to 57 months’ imprisonment and Demontae Terrell Toliver was sentenced to 60 months’ imprisonment for their respective roles in posting information about the minor online for the purpose of making her available for prostitution. A sentence of 60 months’ imprisonment is the maximum sentence allowed by the statute of conviction.
Crutchfield, 28, and Toliver, 24, both of San Jose, pleaded guilty on July 20, 2015, to a superseding information charging them with use of the internet to post information about a minor for sexual activity. According to the defendants’ plea agreements, Crutchfield and Toliver admitted that on June 18, 2013, they posted a telephone number and sexually suggestive photographs of the minor on the now-shuttered Internet site myRedbook.com. The posting was made with the intent to solicit others to pay to engage in sexual activity with the minor. At the time of his arrest, Crutchfield was employed as a Peer Health Counselor with the Santa Clara County Department of Mental Health.
Crutchfield and Toliver were indicted by a federal grand jury on January 29, 2014. They were charged with two counts of sex trafficking of a minor, in violation of 18 U.S.C. §1591, and two counts of production of child pornography, in violation of 18 U.S.C. § 2251(a). Pursuant to the plea agreement, both Crutchfield and Toliver pleaded guilty to a superseding information charging a single count of use of an interstate wire to transmit information about a minor for criminal sexual activity, in violation of 18 U.S.C. § 2425.
The sentence was handed down by the Honorable Ronald M. Whyte, U.S. District Judge. Judge Whyte also sentenced each defendant to a 7-year period of supervised release and ordered each to pay $2000 in restitution to their minor victims. Both men also will be required to register as sex offenders under federal and state law. Toliver, who has been in custody since his arrest in February 2014, will begin serving the sentence immediately. Crutchfield, who had been released to home confinement on $150,000 bond, was ordered to self-surrender on or before March 17, 2016.
Assistant U.S. Attorney Amie Rooney prosecuted the case with the assistance of Laurie Worthen. The prosecution is the result of a joint investigation by the San Jose Police Department Human Trafficking Task Force and the FBI. The arrest and prosecution of these individuals was part of the FBI and San Jose Police Department’s increased efforts and cooperation in rooting out instances of human trafficking in Santa Clara County and the greater Bay Area.
Anyone who suspects instances of human trafficking are encouraged to call the FBI or the Human Trafficking Hotline at 1-888-373-7888. Anonymous calls are welcome.
In addition, suspected child sexual exploitation or missing children may be reported to the National Center for Missing & Exploited Children, via its toll-free 24-hour hotline, 1-800-843-5678.
Two Maryland Residents Indicted for Conspiracy to Steal Firearms in Waynesboro, PennsylvaniaRead the Press Release
HARRISBURG – The United States Attorney’s Office for the Middle District of Pennsylvania announced today that a federal grand jury in Harrisburg has indicted Rodney Robinson, age 30, and Amber Crummitt, age 33, of Boonsboro, Maryland for conspiracy to steal firearms from a federal firearms licensee along with other related charges.
According to U.S. Attorney Peter Smith, Robinson and Crummitt allegedly drove from Maryland to the Walmart in Waynesboro, Pennsylvania on October 22, 2015. Robinson entered the store, forced open the gun case, removed five rifles, and left with the rifles in a car driven by Crummitt. On October 27, 2015, the pair returned to the same store and Robinson again allegedly forced open the gun case removing a rifle and a shotgun; however, this time Robinson left the store without the firearms when an alarm activated.
The indictment charges Crummitt and Robinson with conspiracy to steal firearms, theft of firearms, transportation of stolen firearms across state lines, possessing and disposing of stolen firearms, and possession of firearms by felons.
Robinson is currently in custody on unrelated charges. The U.S. Attorney’s Office will request a summons to be issued for Crummitt to appear in federal court in Harrisburg at a designated time.
The matter was investigated by the Bureau of Alcohol Tobacco, Firearms, and Explosives and the Pennsylvania State Police. The case is being prosecuted by Assistant U.S. Attorney Scott R. Ford.
This case was brought as part of the Violent Crime Reduction Partnership (“VCRP”), a district wide initiative to combat the spread of violent crime in the Middle District of Pennsylvania. Led by the United States Attorney’s Office, the VCRP consists of federal, state and local law enforcement agencies whose mission is to locate, apprehend, and prosecute individuals who commit violent crimes.
Indictments are only allegations. 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.
If convicted of all counts, under federal law, Robinson and Crummitt face respective maximum penalties of 65 and 55 years imprisonment, a term of supervised release following imprisonment, and a 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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Two Maryland Men Plead Guilty to Federal Charges for Roles in Massive Identity Theft and Tax Fraud SchemeRead the Press Release
Worked with Others to Seek More Than $700,000 in Fraudulent Refunds
Two Maryland residents pleaded guilty today for their involvement in a far-reaching stolen identity refund fraud scheme in which they worked with others to seek over $700,000 in income tax refunds through the filing of fraudulent federal income tax returns, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division, U.S. Attorney Channing D. Phillips of the District of Columbia, Special Agent in Charge Thomas Jankowski of the Internal Revenue Service-Criminal Investigation (IRS-CI), Inspector in Charge Maria L. Kelokates of the U.S. Postal Inspection Service, Washington Division and Assistant Inspector General for Investigations John L. Phillips of the U.S. Department of the Treasury.
Michael Whittaker, 31, of Cumberland, Maryland, and Wayne Gardner, 49, of Capitol Heights, Maryland, are among approximately 18 participants in this scheme who have pleaded guilty to charges in the U.S. District Court for the District of Columbia. According to court documents, the overall case involves the filing of at least 12,000 fraudulent federal income tax returns that sought refunds of at least $42 million. The two men pleaded guilty to one count of conspiracy to commit theft of public money and one count of theft of public money.
The charges carry statutory maximum prison terms of five years and 10 years, respectively, as well as potential financial penalties. As part of the plea agreements, Whittaker and Gardner agreed to pay restitution to the IRS in the amounts of $397,090 and $158.160, respectively, which represent that value of the U.S. Treasury checks that were negotiated as a result of their conduct. U.S. District Judge Ellen S. Huvelle set sentencing for May 18.
According to the government’s evidence, Whittaker and Gardner participated in a massive and sophisticated stolen identity refund fraud scheme that involved an extensive network of more than 130 people, many of whom were receiving public assistance. The refunds were sought for tax years 2005 through 2012, often in the names of people, whose identities had been stolen, including the elderly, people in assisted living facilities, drug addicts and incarcerated prisoners. Returns were also filed in the names of, and refunds were issued to, people who were willing participants in the scheme. The refunds listed more than 400 “taxpayer” addresses located in the District of Columbia, Maryland and Virginia.
According to documents filed with the court, Whittaker and Gardner obtained the means of identification of third parties, including names and social security numbers and provided them to a co-conspirator for use in the preparation of fraudulent income tax returns. Whittaker admitted to providing 21 means of identification from August 2010 to May 2012. He also permitted various residential addresses that he controlled to be used as purported taxpayer addresses for the delivery of tax refund checks and deposited U.S. Treasury checks that were received as part of this scheme into his bank accounts. Gardner admitted to providing 65 means of identification to a co-conspirator between August and December 2010. Whittaker admitted that he was involved in the filing of 135 fraudulent tax returns that sought refunds of approximately $494,902. Gardner admitted that he was involved in the filing of 116 fraudulent tax returns that sought refunds of approximately $299,984.
The fraudulent tax returns that were filed as part of the scheme included Schedules C or C-EZ that falsely claimed that each “taxpayer” operated a business, such as “barber” or “childcare,” as a sole proprietorship. The returns falsely stated that the “taxpayer” had gross receipts and two or more dependent children, when, in fact, the “taxpayer” was either a victim of identity theft, was misled into providing his or her identifying information, or was a willing participant in the scheme.
In announcing the pleas, Acting Assistant Attorney General Ciraolo, U.S. Attorney Phillips, Special Agent in Charge Jankowski, Inspector in Charge Kelokates and Assistant Inspector General Phillips commended those who investigated the case. They also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office of the District of Columbia, including former Assistant U.S. Attorney Sherri L. Schornstein and Paralegal Specialists Donna Galindo and Julie Dailey. Finally, they expressed appreciation for the work of Assistant U.S. Attorney Ellen Chubin Epstein of the District of Columbia’s Fraud and Public Corruption Section and Trial Attorneys Jeffrey B. Bender and Thomas F. Koelbl and former Trial Attorney Jessica Moran of the Tax Division, who prosecuted the case.
Two Maryland Men Plead Guilty to Federal Charges for Roles in Massive Identify Theft and Tax Fraud SchemeRead the Press Release
WASHINGTON – Two Maryland residents pleaded guilty today for their involvement in a far-reaching stolen identity refund fraud scheme in which they worked with others to seek over $700,000 in income tax refunds through the filing of fraudulent federal income tax returns, announced U.S. Attorney Channing D. Phillips of the District of Columbia, Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division, Special Agent in Charge Thomas Jankowski of the Internal Revenue Service-Criminal Investigation (IRS-CI), Inspector in Charge Maria L. Kelokates of the U.S. Postal Inspection Service, Washington Division, and Assistant Inspector General for Investigations John L. Phillips of the U.S. Department of the Treasury.
Michael Whittaker, 31, of Cumberland, Maryland, and Wayne Gardner, 49, of Capitol Heights, Maryland, are among approximately 18 participants in this scheme who have pleaded guilty to charges in the U.S. District Court for the District of Columbia. According to court documents, the overall case involves the filing of at least 12,000 fraudulent federal income tax returns that sought refunds of at least $42 million. The two men pleaded guilty to one count of conspiracy to commit theft of public money and one count of theft of public money.
The charges carry statutory maximum prison terms of five years and 10 years, respectively, as well as potential financial penalties. As part of the plea agreements, Whittaker and Gardner agreed to pay restitution to the IRS in the amounts of $397,090 and $158,160, respectively, which represent that value of the U.S. Treasury checks that were negotiated as a result of their conduct. U.S. District Judge Ellen S. Huvelle set sentencing for May 18, 2016.
According to the government’s evidence, Whittaker and Gardner participated in a massive and sophisticated stolen identity refund fraud scheme that involved an extensive network of more than 130 people, many of whom were receiving public assistance. The refunds were sought for tax years 2005 through 2012, often in the names of people, whose identities had been stolen, including the elderly, people in assisted living facilities, drug addicts and incarcerated prisoners. Returns were also filed in the names of, and refunds were issued to, people who were willing participants in the scheme. The refunds listed more than 400 “taxpayer” addresses located in the District of Columbia, Maryland and Virginia.
According to documents filed with the court, Whittaker and Gardner obtained the means of identification of third parties, including names and social security numbers and provided them to a co-conspirator for use in the preparation of fraudulent income tax returns. Whittaker admitted to providing 21 means of identification from August 2010 to May 2012. He also permitted various residential addresses that he controlled to be used as purported taxpayer addresses for the delivery of tax refund checks and deposited U.S. Treasury checks that were received as part of this scheme into his bank accounts. Gardner admitted to providing 65 means of identification to a co-conspirator between August and December 2010. Whittaker admitted that he was involved in the filing of 135 fraudulent tax returns that sought refunds of approximately $494,902. Gardner admitted that he was involved in the filing of 116 fraudulent tax returns that sought refunds of approximately $299,984.
The fraudulent tax returns that were filed as part of the scheme included Schedules C or C-EZ that falsely claimed that each “taxpayer” operated a business, such as “barber” or “childcare,” as a sole proprietorship. The returns falsely stated that the “taxpayer” had gross receipts and two or more dependent children, when, in fact, the “taxpayer” was either a victim of identity theft, was misled into providing his or her identifying information, or was a willing participant in the scheme.
In announcing the pleas, U.S. Attorney Phillips, Acting Assistant Attorney General Ciraolo, Special Agent in Charge Jankowski, Inspector in Charge Kelokates, and Assistant Inspector General Phillips commended those who investigated the case. They also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office of the District of Columbia, including former Assistant U.S. Attorney Sherri L. Schornstein and Paralegal Specialists Donna Galindo and Julie Dailey. Finally, they expressed appreciation for the work of Assistant U.S. Attorney Ellen Chubin Epstein of the District of Columbia’s Fraud and Public Corruption Section and Trial Attorneys Jeffrey B. Bender and Thomas F. Koelbl and former Trial Attorney Jessica Moran of the Tax Division, who prosecuted the case.
Two Colorado Men Plead Guilty to Production of Child Pornography in Separate Unrelated CasesRead the Press Release
DENVER – Two Colorado men recently pled guilty to the production of child pornography, with the produced videos and images involving children who were 4 weeks old (United States v. Sailas) and 3 to 7 years old (United States v. Gallegos) in each respective case, the U.S. Attorney’s Office, the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), and the Federal Bureau of Investigation (FBI) announced. The two men were prosecuted in unrelated cases.
Jamie Sailas, age 30, of Metro Denver, pled guilty on January 15, 2016 to the production of child pornography before U.S. District Court Judge William J. Martinez. Sailas is scheduled to be sentenced by Judge Martinez on April 28, 2016 at 9:30 a.m. According to the stipulated facts contained in the defendant’s plea agreement, Sailas came to law enforcement attention when an HSI agent working in Washington, DC conducted a proactive undercover investigation upon an Internet website that hosted chat rooms. Users of these chat rooms have the ability to upload content to the chat room in the form of pictures and video. While conducting the investigation, the HSI agent came across a link to a video that depicted an adult male engaging in intercourse with a minor female. The investigation led the agent to specific subscriber information which had been submitted to the National Center for Missing and Exploited Children (NCMEC) by the Internet Service Provider. The link was associated with an online storage account that belonged to Jamie Sailas, who at the time resided in Brighton, Colorado. There were nearly 2,900 uploaded file names associated with Sailas’s online storage account, consistent with file names of videos containing child pornography. An email account associated with the online storage account was also determined to belong to Sailas. During the investigation, the local HSI agent learned that two additional NCMEC reports had been generated regarding Sailas, one which involved the email address associated with the online storage account. A legal search of the defendant’s email account reflected that Sailas used the account to send or receive approximately 5500 images and 240 videos of child pornography. The material included minors as young as infants, with a large majority of content depicting prepubescent minor females. It was ultimately determined that in addition to living in Brighton, the defendant worked at Game Trader in Brighton. Search warrants were executed for Sailas’s home, workplace, and vehicle in November 2014. Numerous electronic devices belonging to Sailas were recovered during the execution of the search warrants. During the forensic examination of the electronic devices recovered during the search warrants, numerous images and videos depicting child pornography were recovered, including an image of child pornography that was recovered from one of Sailas’s cell phones. The image of child pornography depicted a penis in the mouth of an approximately 4-week-old infant. The image was taken by Sailas. The defendant had access to the infant because he was a friend of the child’s mother.
Luis Alfonso Aragon Gallegos, age 29, of Glenwood Springs, Colorado, pled guilty on January 13, 2016 to the production of child pornography and to the possession of child pornography before U.S. District Court Judge R. Brooke Jackson. Gallegos is scheduled to be sentenced by Judge Jackson on April 20, 2016 at 8:30 a.m. According to the stipulated facts contained in Gallegos’ plea agreement, the defendant produced approximately 110 images and/or videos of a Colorado child while she performed sex acts on him. The child was between 3 and 7 years old when the images and videos were created. In addition, approximately 266,000 images and 16,100 videos of child pornography, which did not involve the Colorado child and were not produced by the defendant, were found on the defendant’s hard drives. The majority of these files were of prepubescent children, including infants, who were recorded either nude in a sexually provocative manner or engaged in a sex acts. Further, the files involving the Colorado child showed that sexual assaults occurred on 22 days, sometimes in multiple settings during the day. During a child forensic interview, the Colorado child said that the defendant’s conduct continued until he was arrested in 2015. Gallegos also shared child pornographic images peer-to-peer.
“Children were victimized in this case in an unspeakable way,” said U.S. Attorney John Walsh. “Thanks go to Homeland Security and FBI agents, along with federal prosecutors, whose hard work identified and apprehended the defendants of this terrible crime.”
“For good reason, there are significant penalties for predators convicted of sexually exploiting children,” said David A. Thompson, special agent in charge of HSI Denver. “Jamie Sailas faces at least 15 years in federal prison after admitting he produced child pornography. Homeland Security Investigations conducts these child sexual exploitation investigations to obtain justice for their victims, and remove these predators from decent society so they can’t harm other innocent children.”
"The FBI will continue to aggressively pursue those like Gallegos who prey on children, especially those who advertise, trade, and/or produce child pornography," said FBI Denver Special Agent in Charge Thomas Ravenelle. "Crimes of this nature threaten to destroy our most precious resource, offend every sensibility, and cannot be tolerated. The FBI and our partners will spare no expense or resource to bring them to justice."
Sailas pled guilty to one count of production of child pornography, which carries a penalty of not less than 15 years, and up to 30 years in federal prison, and up to a $250,000 fine. Gallegos pled guilty to 22 counts of production of child pornography, each of which also carries a penalty of not less than 15 years, and up to 30 years in federal prison, and up to a $250,000 fine per count. He also pled guilty to one count of possession of child pornography, which carries a penalty of not more than 10 years in federal prison, and up to a $250,000 fine.
Jamie Sailas was investigated by HSI with assistance from the Brighton Police Department. Sailas was prosecuted by Assistant U.S. Attorney Alecia Riewerts. Luis Alfonso Aragon Gallegos was investigated by the FBI with assistance from the Garfield County Sheriff’s Office, the 9th Judicial District Attorney’s Office, and the Glenwood Springs Police Department. Gallegos was prosecuted by Assistant U.S. Attorney David Tonini.
These cases were brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Tragic Accident Takes the Life of Retired Former Prosecutor and WifeRead the Press Release
OXFORD, Miss. - United States Attorney Felicia C. Adams announces that: The United States
Attorney’s Office for the Northern District of Mississippi is deeply saddened over the loss of Al
and Becky Moreton. Al served our office and the entire legal community with great distinction
and honor. The Moretons were stalwart members of Oxford’s community and will be sorely
missed.
Al Moreton was legendary in the legal profession. He was a prosecutor’s prosecutor. He was
greatly respected throughout the Department of Justice. In recognition of his exemplary service
the Department of Justice once stated:
Mr. Moreton, during his career of 38 years, has epitomized what we as the lawyers
for the United States should follow as our guiding example. Al Moreton has left an
indelible mark on those with whom he has worked, done with strokes of politeness,
humor and goodwill but most of all with brilliance, integrity and humility.
Al’s impact upon the U. S. Attorney’s Office here in Oxford is immeasurable. We have heavy
hearts today. We have lost a great mentor and an even greater friend.
Trader Pleads Guilty to Largest Known Computer Hacking and Securities Fraud SchemeRead the Press Release
NEWARK, N.J. – Igor Dubovoy, 28, Alpharetta, Georgia, today admitted his role in an international scheme to hack into three business newswires and steal yet-to-be published press releases containing non-public financial information that was then used to make trades that allegedly generated approximately $30 million in illegal profits, New Jersey U.S. Attorney Paul J. Fishman announced.
Igor Dubovoy pleaded guilty before U.S. District Judge Madeline Cox Arleo to Count One of an indictment charging him with conspiracy to commit wire fraud. He was arrested on Aug. 11, 2015, in connection with a federal indictment brought by the District of New Jersey (DNJ) charging five individuals – two computer hackers and three securities traders – in a large-scale, international conspiracy to hack and steal press releases containing confidential nonpublic financial information relating to hundreds of companies traded on the NASDAQ and NYSE from three newswires.
In addition to Igor Dubovoy, the 23-count DNJ indictment charges Ivan Turchynov, 27, Oleksandr Ieremenko, 24, and Pavel Dubovoy, 32, all of Ukraine, and Arkadiy Dubovoy, of Alpharetta, Georgia. The defendants are all charged with wire fraud conspiracy, securities fraud conspiracy, wire fraud, securities fraud, and money laundering conspiracy. Additionally, Ivan Turchynov and Oleksandr Ieremenko are charged with computer fraud conspiracy, computer fraud, and aggravated identity theft.
The Eastern District of New York (EDNY), in a related indictment charged four securities traders: Vitaly Korchevsky, 50, of Glen Mills, Pennsylvania, Vladislav Khalupsky, 45, of Brooklyn, New York and Odessa, Ukraine, Leonid Momotok, 47, of Suwanee, Georgia, and Alexander Garkusha, 47, of Cummings and Alpharetta, Georgia. The EDNY defendants are charged with wire fraud conspiracy, securities fraud conspiracy, securities fraud, and money laundering conspiracy. On Dec. 21, 2015, Alexander Garkusha pleaded guilty to Count One of the EDNY indictment, charging him with conspiracy to commit wire fraud.
According to documents filed in this case and statements made in court:
Between February 2010 and August 2015, Turchynov and Ieremenko, computer hackers based in Ukraine, gained unauthorized access into the computer networks of Marketwired L.P. (Marketwired), PR Newswire Association LLC (PRN), and Business Wire. They used a series of targeted cyber-attacks, including “phishing” attacks and SQL injection attacks, to gain access to the computer networks. The hackers moved through the computer networks and stole press releases about upcoming announcements by public companies concerning earnings, gross margins, revenues, and other confidential and material financial information.
At one point, one of the hackers sent an online chat message in Russian to another individual stating, “I’m hacking prnewswire.com.” In another online chat, Ieremenko told Turchynov that he had compromised the log-in credentials of 15 Business Wire employees.
The hackers shared the stolen releases with the traders using overseas computer servers that they controlled. In a series of emails, the hackers even shared “instructions” on how to access and use the overseas server where they shared the stolen releases with the traders, and the access credentials and instructions were distributed amongst the traders. In an email, which was sent by one of the traders, the instructions for accessing the overseas server suggested that users conceal their Internet Protocol address when accessing the server as a precaution to avoid detection. For traders created “shopping lists” or “wish lists” for the hackers listing desired upcoming press releases for publicly traded companies from Marketwired and PRN for publicly traded companies. Trading data obtained over the course of the investigation showed that, after the shopping list was sent, the traders and others traded ahead of several of the press releases listed on it.
The traders generally traded ahead of the public distribution of the stolen releases, and their trading activities shadowed the hackers’ capabilities to exfiltrate stolen press releases. In order to execute their trades before the releases were made public, the traders sometimes had to execute trades in extremely short windows of time between when the hackers illegally accessed and shared the releases and when the press releases were disseminated to the public by the newswires, usually shortly after the close of the markets. Frequently, all of this activity occurred on the same day. Thus, the trading data often showed a flurry of trading activity around a stolen press release just prior to its public release.
The traders traded on stolen press releases containing material nonpublic information about the following publicly traded companies that included, among hundreds of others: Align Technology, Inc.; Caterpillar Inc.; Hewlett Packard; Home Depot; Panera Bread Co.; and Verisign, Inc.
The traders paid the hackers for access to the overseas servers based, in part, on a percentage of the money the traders made from their illegal trading activities. The hackers and traders used foreign shell companies to share in the illegal trading profits.
At today’s plea hearing, Igor Dubovoy admitted that when he and others purchased stolen press releases from the computer hackers operating in Ukraine, he knew they contained earnings announcements for publicly trading companies that had not yet been made public. Igor Dubovoy also admitted that he sent the releases to Korchevsky so that he could review them and determine which trades would be profitable based on the stolen material information.
Based on Korchevsky’s recommendations, Igor Dubovoy then executed trades using a number of different brokerage accounts in his name and in Arkadiy Dubovoy’s name, as well as any entities they owned. He also admitted that he provided the hackers with access to at least one trading account held by Arkadiy Dubovoy so that they could confirm how much money was being made from the stolen information. According to Igor Dubovoy, the hackers were paid 50 percent of any profits made in the stock market based on the stolen press releases they provided.
The maximum potential penalties for Count One, conspiracy to commit wire fraud, is 20 years in prison and a fine of $250,000 or twice the gross gain or loss from the offense.
U.S. Attorney Fishman credited the special agents of the U.S. Secret Service, Criminal Investigations Division, under the direction of Director Joseph P. Clancy, and special agents from the Newark Field Office, under the direction of Acting Special Agent in Charge Kenneth Pleasant, with the ongoing investigation leading to today’s plea.
The government is represented by Assistant U.S. Attorneys Andrew S. Pak, Daniel Shapiro, David M. Eskew, and Nicholas Grippo of the Economic Crimes Unit, Computer Hacking & Intellectual Property Section, Assistant U.S. Attorney Svetlana M. Eisenberg of the General Crimes Unit, and Assistant U.S. Attorney Sarah Devlin of the Asset Forfeiture and Money Laundering Unit.
Defense counsel: Lawrence S. Lustberg, Esq., Mary Frances Palisano, Esq., Gibbons PC
Thai National Indicted in Alleged Immigration Fraud SchemeRead the Press Release
PROVIDENCE, R.I. – A federal grand jury in Providence, R.I., returned a 26-count indictment on Tuesday charging Nimon Naphaeng, 34, a native and citizen of Thailand, who currently resides in Wakefield, R.I., with allegedly running an immigration fraud scheme which allegedly included the filing of false asylum applications on behalf of individuals who did not request nor authorize the applications.
The indictment is announced by United States Attorney Peter F. Neronha and Matthew J. Etre, Special Agent in Charge of Homeland Security Investigations for New England.
According to the indictment and information presented to the court, it is alleged that between January 2014 and December 2015, Naphaeng advertised on the Internet and in flyers posted at various businesses that he could assist Thai nationals with obtaining an Employment Authorization Document (EAD) card, and, as a result, further government benefits such as a social security number, a driver’s license and, if they qualify, other financial benefits. It is alleged that Naphaeng, without the consent of the applicants, used personal information they provided to him to secure an EAD card to instead file asylum applications in their names. It is alleged that the applicants did not know that Naphaeng was filing asylum claims in order to secure EAD cards.
In order to qualify for asylum, an applicant must establish that they cannot return to their native country based upon persecution or a well-founded fear of persecution on account of race, religion, nationality, membership in a particular social group, or political opinion. The applicant must personally sign the application and swear under penalty of perjury that the information is true and correct. An initial asylum application grants the applicant certain benefits while their application is pending, including the issuance of an EAD card.
Nationwide, Thai nationals historically file less than 20 asylum applications each year. According to information presented to the court, this investigation began in January 2015, when immigration officials observed a surge of citizens from Thailand submitting asylum applications. A significant number of the applications allegedly shared the defendant’s home or work address. It is alleged that a review of more than 260 of these asylum applications contained virtually identical asylum claims, factual scenarios and supporting documents.
The indictment returned on Tuesday charges Nimon Naphaeng with seven counts of mail fraud, eight counts of visa fraud, ten counts of aggravated identity theft and one count of international money laundering. The government is also seeking the forfeiture of $279,550 seized from Naphaeng, monies allegedly realized by Naphaeng in the execution of the scheme.
An indictment is merely an allegation 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.
Naphaeng, who was arrested on a criminal complaint on December 22, 2105, is detained in federal custody. A federal arrest warrant was obtained based on information developed by agents investigating this matter that Naphaeng was allegedly planning to leave the United States.
The matter was investigated by Homeland Security Investigations, with substantial assistance from the U.S. Citizenship and Immigration Services - Fraud Detection National Security Asylum Office, Newark, N.J., and the Warwick, R.I., Police Department.
The case is being prosecuted by Assistant U.S. Attorneys Richard W. Rose and Mary E. Rogers.
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Contact:
Jim Martin (401) 709-5357
email: [email protected]
on Twitter @USAO_RI
Texas Man Sentenced to 84 Months in Prison for Role in Large-Scale Drug Trafficking ConspiracyRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that a Texas man has been sentenced by U.S. District Judge Ralph R. Beistline to serve 84 months in prison for his role in a conspiracy to sell large quantities of heroin and methamphetamine to Alaska-based drug dealers.
Omar Alejandro Alfaro, 37, of Texas, previously pled guilty to conspiring with others to distribute heroin and methamphetamine. As part of his guilty plea, Alfaro admitted that he personally delivered large quantities of drugs to Alaska-based co-conspirators who then transported the drugs to Anchorage for distribution. Alfaro admitted working with co-conspirators both in the United States and in Mexico.
According to Assistant U.S. Attorney Stephanie C. Courter, who prosecuted the case, the conspiracy began in January 2013 and continued until October 2014. During that time, conspirators imported a total of 12 kilograms of heroin and two pounds of methamphetamine into the United States from Mexico.
As part of his guilty plea, Alfaro admitted personally delivering both heroin and methamphetamine on multiple occasions. In March 2014, for example, Alfaro delivered approximately one kilogram of heroin to an undercover DEA agent posing as an Alaska-based drug dealer. Several months later, in June 2014, Alfaro again delivered drugs to the undercover agent – this time, he delivered approximately 2.5 kilograms of heroin and 866 grams of actual methamphetamine. During the exchange, the undercover agent provided Alfaro with an Alaska themed t-shirt that had been requested by Alfaro’s Mexico-based co-conspirator.
During the sentencing hearing, Judge Beistline noted the devastating consequences that heroin and methamphetamine have on individuals and was particularly concerned about the significant quantity of drugs for which Alfaro was personally responsible. In sentencing Alfaro, Judge Beistline also emphasized the need for deterrence and the need to reinforce societal norms.
The sentencing hearing is related to a string of indictments returned in late 2014 and early 2015 as part of ongoing efforts to dismantle and prosecute several large scale drug trafficking rings with ties to Alaska, California, Texas, Arizona, and Mexico. To date, the following individuals have been sentenced as part of these efforts:
- Timothy Alex, an Anchorage drug distributor, previously sentenced to 108 months in prison;
- Daniel Harris, an Anchorage drug distributor, previously sentenced to 135 months in prison;
- Jose Ramon Canales, of Texas, previously sentenced to 70 months in prison for laundering drug money out of the United States and into Mexico;
- Genaro Gutierrez-Reyes, of California, previously sentenced to 18 months in prison for laundering drug money out of the United States and into Mexico;
- Jorge Armando Zaragoza-Soto, of Mexico, previously sentenced to 96 months in prison for drug trafficking;
- Geronimo Arellano Velarde, of California, previously sentenced to 120 months in prison for drug trafficking; and
- Tomas Gutierrez Ayala, of California, previously sentenced to 75 months in prison for drug trafficking.
Several other defendants are set to be sentenced in the coming months for their roles in trafficking heroin, cocaine, and methamphetamine to Alaska and then transporting the cash proceeds of their trafficking activities back to Mexico.
This and the related cases were investigated as part of the Organized Crime Drug Enforcement Task Force (OCDETF). In announcing the sentence, U.S. Attorney Loeffler praised the work of the law enforcement agencies involved, including the Drug Enforcement Administration (DEA), the Internal Revenue Service Criminal Investigation (IRS-CI), the Federal Bureau of Investigation (FBI), the U.S. Postal Inspection Service (USPIS), U.S. Immigration and Customs Enforcement (ICE), which oversees Homeland Security Investigations (HSI), the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), the Anchorage Police Department (APD), the Alaska State Troopers (AST), and the Anchorage Airport Police Department. Additional assistance was provided by the U.S. Attorney’s Offices for the Western District of Texas, the Eastern and Central Districts of California, and the District of Arizona, as well as federal agents in all three states.
Texas Man Indicted for Federal Tax CrimesRead the Press Release
An Austin, Texas, businessman was indicted by a federal grand jury for five counts of filing false tax returns and one count of corruptly endeavoring to obstruct and impede the due administration of the internal revenue laws, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division.
According to the allegations in the superseding indictment, Victor Antolik owned and operated a commercial janitorial business in Austin, San Antonio and Houston, Texas, for which he used a variety of business names, including Diversified Building Services Inc., DBS Services Inc., Partners in Cleaning, PIC Building Services and BSI Industries. Antolik also earned income as a real estate agent, real estate broker and property manager. Antolik earned a portion of his real estate income through his companies SGN Realty Inc. and Signature Realty Services. For the tax years 2004, 2007 and 2008, Antolik submitted to the Internal Revenue Service (IRS) a total of four false individual income tax returns on which he underreported his income. In addition, between 1998 and 2014, Antolik attempted to obstruct the IRS by, among other things, attaching altered Forms W-2 and 1099 to his tax returns, providing false information to his accountants that was used to prepare both corporate and individual income tax returns on his behalf, and using nominees to conceal income and assets.
If convicted, for each count, Antolik faces a statutory maximum sentence of three years in prison, a maximum fine of $250,000 and restitution to the IRS.
An indictment is not a finding of guilt. Individuals charged in indictments are presumed innocent until proven guiltly beyond a reasonable doubt.
Acting Assistant Attorney General Ciraolo thanked agents of the IRS-Criminal Investigation, who are investigating the case and Tax Division Trial Attorneys Robert A. Kemins and David Zisserson, who are prosecuting the case. Acting Assistant Attorney General Ciraolo also thanked the U.S. Attorney’s Office for the Western District of Texas for their substantial assistance.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Tax Return Preparer Pleads GuiltyRead the Press Release
PHLADELPHIA - Carmen Basilis, 52, of Reading, Pennsylvania, pleaded guilty yesterday to tax fraud charges admitting that she had falsified miscellaneous deductions on her clients’ tax returns in order to obtain inflated tax refunds which her clients where not entitled to receive. U.S. District Court Judge James Knoll Gardner scheduled a sentencing hearing for May 5, 2016.
In lieu of receiving United States Treasury Checks, Basilis’ clients applied for Refund Anticipation Loans which permitted them to receive a loan from a bank within several days following the filing of their returns. By executing IRS Form 8888, Basilis caused a portion of the filer’s refund to be deposited into her personal bank account, a fact not known by her clients. After doing so, Basilis issued the Refund Anticipation Loan checks to her clients. The IRS, in turn, sent the bank the refund that Basilis had requested from the United States Treasury, to pay off the loans that the filers had been issued. In addition to taking a portion of the filer’s refund, Basilis also charged her clients a fee for preparing and electronically filing the returns with the Internal Revenue Service.
The case was investigated by IRS Criminal Investigations and was prosecuted by Assistant United States Attorney Floyd J. Miller.
Tampa Man Sentenced to Federal Prison for Manufacturing Counterfeit Federal Reserve NotesRead the Press Release
Jacksonville, Florida – Senior United States District Judge Henry Lee Adams has sentenced Darius Jondi Edwards (36, Tampa) to 33 months in federal prison for manufacturing counterfeit Federal Reserve notes. As part of his sentence, the Court ordered Edwards to pay restitution to the various businesses that he had defrauded.
According to court documents, Edwards used computer media to manufacture counterfeit Federal Reserve notes in denominations of $10, $20, and $100, then provided them to his co-defendant, Timothy Deante Burroughs. During the same period, Burroughs and Edwards entered various businesses in Jacksonville and passed counterfeit $100 bills. On December 1, 2014, Burroughs entered a Publix and passed counterfeit cash. Upon being confronted by store employees, he fled on foot. Officers from the Jacksonville Sheriff’s Office soon located Burroughs at a nearby motel and detained him. A search of the motel room resulted in the recovery of additional counterfeit $100 bills and led law enforcement to another motel in the immediate vicinity.
At the second location, law enforcement encountered Edwards in front of a motel room. During a search of his room, officers located sheets of uncut counterfeit $100, $20, $10, $1 bills, along with several bleached genuine $10 bills printed as counterfeit $100 notes. They also recovered multiple computers and printers being used by Edwards to manufacture counterfeit currency.
On December 20, 2015, Burroughs was sentenced to 21 months in federal prison for his role in the case. As part of his sentence, the Court ordered Burroughs to pay restitution to the various businesses that he had defrauded.
This case was investigated by the Jacksonville Sheriff’s Office and the United States Secret Service, Jacksonville Field Office. It is being prosecuted by Assistant United States Attorney Kevin C. Frein.
Sex Trafficking Ring Leader Gets Life in Federal PrisonRead the Press Release
HOUSTON – The 68-year-old woman behind a 14-defendant sex trafficking ring operating in Houston has been ordered to federal prison for life, announced U.S. Attorney Kenneth Magidson along with FBI Special Agent in Charge Perrye K. Turner, Special Agent in Charge Brian Moskowitz of Immigration and Customs Enforcement – Homeland Security Investigations (ICE-HSI), and Special Agent in Charge Richard Goss of IRS-Criminal Investigation (CI).
A federal jury convicted Hortencia Medeles-Arguello aka Raquel Medeles Garcia, Raquel Medeles Garcia or “Tencha,” April 24, 2015, following a 10-day trial and approximately four hours of deliberations. She was convicted on all counts - conspiracy to commit sex trafficking, conspiracy to harbor aliens, aiding and abetting to commit money laundering and conspiracy to commit money laundering.
This landmark sex trafficking case is one of the most significant in scope and magnitude to be tried to a verdict of guilty on all counts, and one of the few in which as many as 12 victims of an international sex trafficking scheme came forward to testify at trial. Twelve victims rescued in connection with this case testified at trial regarding the horrors of their ordeals, beginning with being recruited in their home countries, only to be forced into prostitution against their will in the United States. Some victims were as young as 14 when the traffickers recruited them, using fraud and false pretenses to lure them into the traffickers’ control.
“The importance of this case cannot be underscored,” said Magidson. “These were human beings – women and children – who were treated as a commodity. They came from their home countries hoping for a better life, only to be enslaved and forced into unspeakable acts. This is a local, national and international issue, but also a humanitarian issue. We will continue to take action against these egregious offenders and seek to obtain the stiffest penalties in order to send a clear message that human trafficking will not be tolerated in this district.”
Today, U.S. District Judge David Hittner, who presided over the trial, handed Tencha a sentence of life in federal prison. At the hearing, additional testimony from six of the victims was also presented. They asked the judge to punish the defendant for the impact she had on their lives.
In addition, 15 real properties and other assets for a value of about $2.5 million will be forfeited to the United States having been found to have been purchased with sex trafficking proceeds. The funds will be used to make restitution to the victims of this horrible crime.
“Let this sentence send a message that lives are not to be bought and sold,” said Turner. “The Human Trafficking Rescue Alliance (HTRA) seeks to rescue those forced into this modern day slavery and hold accountable those who wish to profit from the abuse of others. If you have information about human trafficking, we urge you to contact the National Human Trafficking Hotline at 1-888-373-7888.“
“Investigations and the subsequent criminal prosecution like this one highlight the significant collective and collaborative efforts of law enforcement agencies in greater Houston that are involved in the fight against human trafficking,” said Moskowitz. “This should also serve as a warning to all individuals and criminal groups involved in the trafficking of minors and women that we are determined to expend the resources necessary to investigate and prosecute to the full extent of the law all that are involved in this heinous crime.”
Testimony revealed that pimps recruited the young girls by convincing them they were in love, making threats to their families as well as threatening the girls themselves. Testimony revealed Tencha knew that many of the girls prostituted at her establishment were either underage or victims of the beatings by their pimps.
On the first full day of trial, the jury heard from one of the victims in the case. She detailed the horrific conditions she faced at the hands of the defendant and others, to include being forced into having sex at age 14 after she had come to this country in search of a better life. She described how she was forced to comply with demands at gunpoint and locked in a room. She was eventually impregnated by a “customer” and was moved to another area of the bar because she was not worth as much once she became pregnant. Following the move, she found a way to escape with the help of a customer who had befriended her.
“Today’s sentencing closes the book on a heinous criminal organization that profited from exploiting innocent women and minors in the worst possible way,” said Goss. “IRS special agents are committed to dismantling the financial infrastructure of criminal enterprises of this nature and removing any financial incentive to exploit innocents.”
Evidence at trial indicated that Tencha made more than $1.6 million in a 19-month period by supplying the upper floor of her cantina for prostitutes to ply their trade. The evidence further revealed that many of the prostitutes were either minors or forced to engage in sex acts at the defendant’s bar. The jury heard that Tencha had engaged in harboring illegal aliens, many who were forced into prostitution for more than 13 years.
She will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
All of Tencha’s co-defendants who were in custody have pleaded guilty for their respective roles in the conspiracy. Many admitted they worked for Las Palmas II, a cantina located in Houston. They all knew the cantina concealed, harbored and shielded illegal aliens who worked there from detection by law enforcement and that the owners were profiting from such concealment. As part of their employment, they aided in the operation of the business and their conduct substantially facilitated the concealment, harboring and shielding of the employees and patrons of the Las Palmas II, whom they all knew were illegally in the U.S. Other co-defendants pleaded guilty to helping Tencha keep track of the monies she made, including investing it in properties she purchased in the Houston area.
Abel Medeles aka Chito, 67, Tencha’s brother, operated the Las Palmas II parking lot. It was part of his job to notify his co-conspirators inside the cantina of any law enforcement presence he observed in order for his co-conspirators to be able to conceal from law enforcement the illegal activities in the Las Palmas II. Similarly, on at least one occasion, Odelia Hernandez, 47, Tencha’s sister, told co-conspirators to lock the doors when she realized law enforcement was coming. Medeles was sentenced to 55 months and ordered to pay a $2,000 fine, while Hernandez received a sentence of 66 months and must pay a $1500 fine.
Eduardo Guzman Gonzales aka Miguel Rojas or El Pantera, 33, and Alberto Mendez Flores aka Ardilla, 27, managed the cantina. They paid Tencha $20,000 each week out of the money received from the operation of the Las Palmas II and kept all the monies received in excess of that amount. Both men received sentences of 88 months in federal prison.
Jose L. Uraga aka Wicho, 36, provided false/fraudulent identifications to employees, to include females working at Las Palmas II, and was sentenced to 28 months. Jorge Antonio Teloxa-Barbosa aka Eli, 31, testified at trial to his part in the conspiracy. He also managed the cantina with Guzman and Mendez and paid Tencha $20,000 each week out of the money received from the operation of Las Palmas II, keeping all the monies received in excess of that amount. He received a sentence of 37 months.
Graciela Medeles Ochoa, 37, Tencha’s daughter, assisted Tencha in counting the proceeds obtained from Las Palmas II. She also negotiated cashier’s checks for her mother and sister, Delia Diaz. The money used to obtain the cashier’s checks came from the sex trafficking violations occurring at Las Palmas II. Ochoa, who also testified about her mother’s unlawful conduct, was sentenced to 18 months. Diaz, 51, received 71 months for money laundering. Another of Tencha’s daughters, Diana Medeles Garcia aka Diana Garcia Marquez, 50, testified that her mother had been running brothels since she was 13 years old. She received 21 months for aiding and abetting to harbor illegal aliens.
Guadalupe Valdez Lugo aka Lupe, 58, worked as a manager at Las Palmas II, overseeing the female workers as well as the regular employees. She also testified at trial about Tencha’s unlawful conduct and received a sentence of 25 months as well as a $5,000 fine.
Another of Tencha’s sisters, Lilia Medeles Cerda aka Lilly, 66, received a sentence of 52 months for conspiracy to harbor Illegal Aliens. Talat Crippin aka Chacho, 27, who was married to one of Tencha’s granddaughters pleaded guilty to being a lookout for Tencha’s brothel and received 41 months.
David Garcia, 46, (Techa’s son) was convicted of aiding and abetting to harbor illegal aliens and will be sentenced next month.
Another defendant - Alfonso Diaz-Juarez aka Ponco or El Grenas, a 45-year-old Mexican national - is a fugitive and a warrant remains outstanding for his arrest. Anyone with information about his whereabouts is asked to contact the FBI at 713-693-5000. A Clear Channel Outdoor digital billboard campaign launched in December across the Greater Houston area touted an up to $50,000 reward for information leading to the location and arrest of Diaz-Juarez.
The investigation leading to the filing of criminal charges was the result of a three-year investigation conducted by members of the HTRA in Houston, which includes the FBI, ICE-HSI, Harris County Sheriff’s Office, IRS-CI, Texas Alcoholic and Beverage Commission, Department of State, Texas Department of Public Safety and the Houston Police Department.
Assistant U.S. Attorneys Ruben R. Perez and Joe Magliolo are prosecuting the case.
Scientists Indicted for Allegedly Stealing Biopharmaceutical Trade SecretsRead the Press Release
PHILADELPHIA – An indictment was filed today charging five people in an alleged scheme to steal biopharmaceutical trade secrets from pharmaceutical company GlaxoSmithKline (GSK), announced United States Attorney Zane David Memeger. Charged in the conspiracy are: Yu Xue, 45, of Wayne, PA; Tao Li, 42, of Nanjing, China; Yan Mei, 36, of Nanjing, China; Tian Xue, 45, of Charlotte, NC; and Lucy Xi, 38, of West Lake Village, CA. The indictment includes charges of conspiracy to steal trade secrets, conspiracy to commit wire fraud, conspiracy to commit money laundering, theft of trade secrets, and wire fraud.
Yu Xue and Lucy Xi were scientists working at GSK’s research facility in Upper Merion, PA. According to the indictment, the defendants engaged in a scheme to steal trade secrets related to GSK research data, procedures, and manufacturing processes for biopharmaceutical products. Many of the biopharmaceutical products targeted were designed to treat cancer or other serious diseases. Yu Xue, Tao Li, and Yan Mei formed a corporation in China called Renopharma allegedly to market and sell the stolen trade secret information. It is further alleged that in order to hide the proceeds of the crime, Yu Xue, Tao Li, and Yan Mei agreed to title the proceeds in the name of Yu Xue’s sister, Tian Xue, and other family members.
If convicted of all charges, each defendant faces a possible prison term, fines, restitution, special assessments, and a term of supervised release.
The case was investigated by the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorney Robert Livermore.
San Miguel County Man Sentenced to 84 Months for Federal Child Pornography ConvictionRead the Press Release
ALBUQUERQUE – Guy N. Martinez, 23, of Las Vegas, N.M., was sentenced today in federal court in Albuquerque, N.M., to 84 months in federal prison followed by 15 years of supervised release for his federal child pornography conviction. Martinez will also be required to register as a sex offender.
Martinez was arrested in July 2014, and charged in a criminal complaint with possessing, receiving and distributing visual depictions of minors engaged in sexually explicit conduct. According to the criminal complaint, the FBI initiated the investigation leading to Martinez’s arrest after receiving a lead from Queensland Police Service (QPS) in Brisbane, Australia. Following the arrest of an Australian citizen in March 2012, on child pornography charges, the QPS identified more than 100 United States-based email accounts that allegedly had been used to send, receive or discuss child pornography with the Australian citizen. Investigation by the FBI revealed that one of those email accounts was subscribed to Martinez.
The FBI’s investigation revealed that Martinez had two email accounts that allegedly had been used to receive and distribute more than 1,000 images consistent with child pornography. On July 18, 2014, the FBI executed a search warrant at Martinez’s residence in Las Vegas, N.M. They arrested Martinez while executing the search warrant.
Martinez was subsequently indicted on Aug. 12, 2014, and charged with receiving and possessing visual depictions of minors engaged in sexually explicit conduct from March 1, 2012 through July 18, 2014 in San Miguel County, N.M. Martinez pled guilty to possession of visual depictions of minors engaged in sexually explicit conduct on Aug. 20, 2015. Martinez admitted that between March 1, 2012 and July 18, 2014, he possessed images of child pornography that traveled in interstate commerce.
This case was investigated by the Santa Fe office of the FBI and the New Mexico State Police with assistance from the QPS. The case is being prosecuted by Assistant U.S. Attorney Jacob A. Wishard as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice (DOJ) to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and DOJ’s Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
The case also was brought as a part of the New Mexico Internet Crimes Against Children (ICAC) Task Force’s mission, which is to locate, track, and capture Internet child sexual predators and Internet child pornographers in New Mexico. There are 82 federal, state and local law enforcement agencies associated with the New Mexico ICAC Task Force, which is funded by a grant administered by the New Mexico Office of the Attorney General. Anyone with information relating to suspected child predators and suspected child abuse is encouraged to contact federal or local law enforcement.
Registered Sex Offender Sentenced to Life for Jefferson County CrimesRead the Press Release
BEAUMONT, Texas – A 45-year-old Galveston, Texas man has been sentenced to Life in federal prison for child exploitation violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Jose Stephen Gracia pleaded guilty on July 27, 2015 to production of child pornography and was sentenced to Life in federal prison today by U.S. District Judge Marcia Crone.
According to information presented in court, on Apr. 2, 2015, federal agents executed a search warrant at Gracia’s residence in Galveston based on information that child pornography was being distributed from that location. During the search, investigators located a digital memory card in a locked safe that contained videos of Gracia and his victims. In these videos, Gracia, a registered sex offender, was engaged in sexual activity with the children. Further investigation revealed the videos were originally produced in Jefferson County, Texas. Gracia was indicted by a federal grand jury on May 7, 2015.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case is being investigated by the Department of Homeland Security (DHS) Homeland Security Investigations (HSI), Jefferson County District Attorney’s Office, Jefferson County Sheriff’s Office, Galveston Police Department, Pearland Police Department and the Internet Crimes Against Children (ICAC) and prosecuted by Assistant U.S. Attorney Lesley Bartow.
Ponchatoula Man Sentenced to 27 Years in Prison After Pleading Guilty to Sexually Exploiting ChildrenRead the Press Release
U.S. Attorney Kenneth A. Polite announced that ROBERT SWAN, age 53, of Ponchatoula, was sentenced today for his role in sexual exploiting children, including receiving images depicting the sexual victimization of children.
U.S. District Judge Stanwood R. Duval, Jr. sentenced SWAN to 327 months imprisonment, followed by supervised release for life, and a $100 special assessment. Additionally, SWAN is also required to register as a sex offender pursuant to the Sex Offender Registration Notification Act.
According to court document, on January 30, 2013, investigators with the State of Louisiana Department of Justice – Cyber Crime Unit, executed a search warrant on SWAN’S residence. The search was based on evidence obtained by law enforcement that between about November 30, 2012, and December 1, 2012, SWAN distributed, by making publicly available in the shared folder of his peer-to-peer program, videos depicting the sexual victimization of children between the ages of two and ten. Agents seized fifteen separate digital devices, including two computers and thirteen digital storage drives.
While reviewing materials seized in the search, agents found digital evidence that in about January 2010, SWAN and his associate, THOMAS MIDDLETON, forced a then-three year-old girl to engage in sexually explicit conduct, which SWAN recorded. MIDDLETON was convicted in the Western District of Kentucky for his role in the offense.
Additionally, agents found that between about May 2010 and January 2013, SWAN had downloaded, saved, and catalogued over 500,000 images and videos – one of the largest collections of child pornography found in the State of Louisiana –depicting children as young as four-weeks old being forced to engage in sexually explicit conduct. Titles of many of the videos were consistent with the content of the videos.
Because of SWAN’S prior conviction in 1987 for lewd and lascivious assault of a minor in Escambia County, Florida, SWAN faced an enhanced sentence.
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.”
U.S. Attorney Polite praised the work of the State of Louisiana Department of Justice – Cyber Crime Unit in investigating this matter. Assistant United States Attorney Jordan Ginsberg was in charge of the prosecution.
Pennsylvania Man Sentenced for Possession of Explosives, Fraud and Weapons OffensesRead the Press Release
Istvan Merchenthaler, 45, of Downingtown, Pennsylvania, was sentenced today to 140 months in prison for wire fraud, aggravated identity theft, money laundering, filing false tax returns, interstate transportation of stolen property, possessing unregistered destructive devices, possessing firearms and ammunition as a fugitive and possessing an illegally manufactured firearm. These charges stemmed from two indictments in this district and one indictment, each, in the Eastern District of North Carolina and the District of Maryland. All of the cases were consolidated before U.S. District Judge Robert F. Kelly for the Eastern district of Pennsylvania who also ordered three years of supervised release, a $2,200 special assessment and more than $3.4 million in restitution.
Between May 2006 and February 2013, Merchenthaler claimed to be the founder of PhoneCard USA, a company that was purportedly a “premier distribution source” for prepaid phone cards, prepaid phones and prepaid “adult entertainment cards.” Merchenthaler, who used a number of aliases, falsely claimed that PhoneCard USA had “lucrative contracts” with major retail chain stores including Walmart, 7-Eleven and BJ’s Wholesale Club. In reality, Merchenthaler operated a “Ponzi” scheme, stealing over $3 million from over 250 investors and using much of these funds to buy expensive cars, jewelry and firearms and to perpetuate his scheme. To line his pockets with these victims’ funds, Merchenthaler used stolen identities, impersonated corporate executives, forged signatures and fabricated bogus contracts. Merchenthaler continued his scheme while he was on pretrial release in this district. He also filed false tax returns, defrauding the United States of over $400,000.
While on pretrial release, Merchenthaler also removed his electronic monitoring bracelet and fled as a fugitive. In order to evade authorities, Merchenthaler stole two vehicles from car dealerships in Pennsylvania and North Carolina and fled from the scene of a traffic stop by the Pennsylvania State Police while driving one of the stolen vehicles. The U.S. Marshals Service Fugitive Task Force and the Maryland State Police later apprehended Merchenthaler in Bel Air, Maryland.
Moreover, prior to and after jumping bail from this district, Merchenthaler amassed approximately 17 firearms and over approximately 11,580 rounds of ammunition, as well as approximately 634 improvised explosive devices (IEDs), which he stored in Pennsylvania, North Carolina and Maryland. Approximately 67 of these IEDs were comprised of PVC pipe, almost all of which contained shrapnel in the form of nails, screws, or rocks. The remaining approximately 567 IEDs were comprised of cardboard tubes in varying sizes and explosive power. All of the IEDs – PVC and cardboard – were center primed with flash powder. Merchenthaler drove these IEDs in his stolen vehicles to storage facilities in all three states. During render safe procedures at a North Carolina storage facility, several of the IEDs exploded, resulting in damage to a bomb squad robot and the storage facility.
The case was investigated by the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigations, the U.S. Marshals Service Fugitive Task Force, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Pennsylvania State Police, the Philadelphia Police Bomb Disposal Unit, the Montgomery County Bomb Squad, the Montgomery County Sheriff’s Office, the East Whiteland Police Department, the East Whiteland Fire Department, the Malvern Fire Department, the Maryland State Police, the North Carolina State Bureau of Investigation, the Downingtown Police Department and the Chester County District Attorney’s Office. The case was prosecuted by Assistant U.S. Attorneys Vineet Gauri, Jason Kellhofer and Adam Ake in the U.S. Attorney’s Offices for the Eastern District of Pennsylvania, Eastern District of North Carolina and the District of Maryland.
Paul Hebert Pleads Guilty to Social Security and Medicaid FraudRead the Press Release
Paul Hebert, 50, of Gloucester, Massachusetts, formerly of Barre, Vermont, pleaded guilty today to charges of Social Security fraud and Medicaid fraud.
At today’s hearing, Hebert admitted that he made multiple false statements concerning his ability to work when he testified under oath at a Social Security Administration hearing on October 28, 2010; he failed to disclose changes in his income after the hearing as required by law; and he wrongfully continued to receive Social Security Income benefits until April 4, 2013. Hebert also admitted that, after obtaining Medicaid benefits on February 24, 2009, he failed to report changes in his income and employment status, as required by law, and wrongfully received Medicaid benefits until approximately November 2012.
At sentencing, Hebert faces up to five years imprisonment, and a fine of up to $250,000 on each count. The actual sentence will be determined through reference to federal sentencing guidelines and applicable statutes. According to the plea agreement, defendant Hebert has agreed to pay restitution totaling $53,660.57 prior to his sentencing hearing, and both the United States and defendant Hebert are jointly recommending that Hebert be sentenced to four years of probation. Such a recommendation is not binding on the Court at sentencing.
United States Attorney Eric S. Miller commended the efforts of the SSA Office of Inspector General, Boston Field Division; HHS Office of the Inspector General, Boston Regional Office; and the National Oceanic Atmospheric Administration, Office of Law Enforcement, in the investigation and prosecution of Hebert.
Hebert is represented by Paul S. Volk, Esq. The prosecutor is Assistant U.S. Attorney Jonathan Ophardt.
Palm Beach County Man Indicted for Fraudulently Collecting Murdered Father’s Retirement BenefitsRead the Press Release
A Palm Beach County man is charged with fraudulently using his father’s identity to collect unauthorized Social Security and pension retirement benefits, knowing of his father’s unreported murder.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Sheriff Ric. L. Bradshaw, Palm Beach County Sheriff's Office (PBSO), Margaret Moore-Jackson, Special Agent in Charge, Social Security Administration, Office of Inspector General (SSA-OIG), Nadine Gurley, Special Agent in Charge, U.S. Department of Housing and Urban Development, Office of the Inspector General (HUD-OIG), and Karen Citizen-Wilcox, Special Agent in Charge, U.S. Department of Agriculture, Office of Inspector General (USDA-OIG), made the announcement.
Jason Henry Davis, 37, of West Palm Beach, Florida, was charged with eight counts of wire fraud, in violation of Title 18, United States Code, Section 1343; one count of access device fraud, in violation of Title 18, United States Code, Section 1029(a); twelve counts of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A; and two counts of making a false statement to a government agency, in violation of Title 18, United States Code, Section 1001. The defendant had his initial appearance earlier today, January 20, 2016 before the Honorable United States Magistrate Judge William Matthewman, in West Palm Beach. He is scheduled for a pretrial detention hearing on January 27, 2016.
As alleged in the indictment, on April 18, 2013, the skeletal remains of Henry T. Davis, Jr., the father of defendant Jason Davis, were found in the backyard of the Lantana, Florida residence where Henry Davis had lived with the defendant and his ex-wife, Jason Davis’ mother. The indictment alleges that Jason Davis was present when his father was murdered, as early as 2008, and failed to report his death to the authorities. Jason Davis then assumed his father’s identity in order to collect approximately $1,500 in monthly Social Security and HUD funded pension retirement benefits. The defendant also failed to report his receipt of these funds to the Department of Agriculture in order to fraudulently obtain food assistance benefits. As a result of his fraudulent scheme, the defendant collected approximately $120,000 in federally-funded benefits which he was not personally qualified to receive.
Mr. Ferrer commended the investigative efforts of the Palm Beach County Sheriff’s Office Homicide Unit and Public Assistance Fraud Task Force, SSA-OIG, HUD-OIG, and USDA-OIG. This case is being prosecuted by Assistant U.S. Attorneys Carolyn Bell and Adam McMichael.
An indictment is only an accusation and a defendant is presumed innocent unless and until proven guilty.
A 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.
Oxon Hill Woman Pleads Guilty to Stealing over $176,000 in Social Security BenefitsRead the Press Release
Baltimore, Maryland – Gloria Wilson, age 59, of Oxon Hill, Maryland, pleaded guilty today to theft of government property arising from a scheme to steal $176,874 in social security benefits.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Michael McGill of the Social Security Administration - Office of Inspector General, Philadelphia Field Division.
According to her guilty plea, Wilson’s stepmother, E.W., received retirement benefits from the Social Security Administration (SSA). E.W. died on October 31, 1996. Her death was not reported to SSA. At the time of her death, the retirement benefits were paid by U.S. Treasury check and mailed to a post office box held in E.W. and Wilson’s names. The checks were then deposited into a checking account held jointly by E.W. and Wilson. Wilson endorsed the checks in her name and in the name of E.W.
In 2000, SSA stopped issuing paper checks to E.W. and instead paid the benefits by direct deposit into the jointly held account. SSA stopped paying the benefits in January 2014.
SSA paid a total of $176,874 in retirement benefits for E.W. after October 31, 1996. After her stepmother’s death, Wilson withdrew substantially all of the benefits deposited in the bank account.
When she was interviewed by law enforcement on March 11, 2014, Wilson admitted that she knew she was not entitled to E.W.’s retirement benefits.
Wilson faces a maximum sentence of 10 years in prison for theft of government property. Wilson has agreed to pay restitution of $176,874. Chief U.S. District Judge Catherine C. Blake has scheduled sentencing for April 21, 2016 at 2:00 p.m.
United States Attorney Rod J. Rosenstein commended the Social Security Administration - Office of Inspector General for its work in the investigation and thanked Special Assistant U.S. Attorney Lauren E. Perry, who is prosecuting the case.
Organized Crime Member Sentenced for Drug ConspiracyRead the Press Release
BOSTON – An alleged member of the New England Family of La Cosa Nostra was sentenced yesterday in U.S. District Court in Boston for conspiring to traffic over 40 kilograms of marijuana from July 2013 to February 2014.
Louis L. DiNunzio, 29, of Medford, was sentenced by U.S. District Court Chief Judge Patti B. Saris to 18 months in prison and ordered to forfeit $10,000. In September 2015, DiNunzio pleaded guilty to conspiracy to distribute marijuana.
In 2013, law enforcement initiated a long-term investigation, known as Operation Excalibur, into drug-trafficking, illegal gambling, extortion, and other criminal activity by the members and associates of the New England Family of La Cosa Nostra (NELCN). DiNunzio allegedly was a member of the NELCN and is the son of former NELCN Boss Anthony DiNunzio, who is currently in federal prison for RICO conspiracy. As part of the conspiracy, DiNunzio and others purchased large quantities of marijuana and shipped them via UPS under fictitious names to Massachusetts.
Earlier this month, two other alleged NELCN associates involved in the conspiracy were sentenced. Joseph Spagnuolo-Kazonis, 30, of Boston, was sentenced to 18 months in prison and ordered to forfeit $10,000. John Woodman, 43, of Braintree, was sentenced to one year and one day in prison, and ordered to pay a fine of $4,000 and to forfeit $5,000.
In additional cases arising from this investigation, Anthony Spagnolo, 67, and Pryce Quintina, 75, both of Revere, pleaded guilty in December 2015 to conspiracy to interfere with interstate commerce by extortion and will be sentenced in March 2016. On Jan. 13, 2016, John Evans, 68, of Middleborough, and Joseph Petrucelli, 24, of Winthrop, pleaded guilty to conducting an illegal gambling business and will be sentenced in April 2016.
United States Attorney Carmen M. Ortiz: Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and Colonel Richard D. McKeon, Superintendent of the Massachusetts State Police, made the announcement today. Assistance was also provided by the Internal Revenue Service’s Criminal Investigations, the Massachusetts Department of Correction, and the Boston, Braintree, Everett, Medford and Quincy Police Departments and the FBI’s San Diego Division. The case was prosecuted by Assistant U.S. Attorneys Timothy E. Moran and Seth B. Kosto of Ortiz's Criminal Division.
Newburgh Fire Chief Charged in White Plains Federal Court with Fraudulently Obtaining Retirement BenefitsRead the Press Release
Preet Bharara, United States Attorney for the Southern District of New York, Diego Rodriguez, the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), and Thomas P. DiNapoli, New York State Comptroller, announced the indictment of MICHAEL J. VATTER, the Chief of the Newburgh Fire Department, charging him with fraudulently obtaining approximately $95,000 in pension benefits by failing to report his return to work in the public sector to the New York State and Local Police and Fire Retirement System. Under New York State law, a public sector retiree who is receiving a pension and who returns to public service cannot receive both pension payments and a public sector paycheck. The law permits public sector retirees to earn up to $30,000 per year from public sector employment before their pension benefits are cut off for that year.
According to the allegations contained in the Indictment[1] unsealed today in White Plains federal court:
VATTER served in the Newburgh Fire Department in various capacities from 1980 until his retirement in May 2000. Following his retirement, VATTER attended law school and practiced law. In November 2009, the Indictment charges, VATTER returned to the Newburgh Fire Department as its Chief. The Indictment further alleges that VATTER failed to report his return to the public sector despite knowing he had a duty under state law to do so. As a result of this conduct, VATTER obtained $95,106 in pension benefits from the New York State and Local Police and Fire Retirement System source to which he was not entitled.
VATTER, 57, of Walkill, New York, is charged with one count of wire fraud, which carries a maximum sentence of 20 years in prison.
Mr. Bharara praised the investigative work of the FBI, the Office of the New York State Comptroller, the Orange County District Attorney's Office, and the Orange County Sheriff's Office.
This prosecution is being handled by the Office's White Plains Division. Assistant U.S. Attorney James McMahon is in charge of the prosecution.
The charge contained in the Indictment is merely an accusation, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment forth herein constitute only allegations, and every fact described should be treated as an allegation.
New York Man Sentenced to 54 Months in Federal Prison for Obtaining and Selling Prescription NarcoticsRead the Press Release
Deirdre M, Daly, United States Attorney for the District of Connecticut, announced that DONALD McCANN, 32, of Bedford Hills, N.Y., was sentenced today by Chief U.S. District Judge Janet C. Hall in New Haven to 54 months of imprisonment, followed by five years of supervised release, for illegally obtaining and distributing prescription narcotics.
According to court documents and statements made in court, in May 2012, the Drug Enforcement Administration began an investigation into the filling of fraudulent prescriptions for oxycodone at pharmacies in Connecticut and New York through the use of fraudulent identifications. The investigation revealed that McCANN purchased prescription paper and obtained identifying information to forge prescriptions from at least five doctors. McCANN and Jesse Kaplan then traveled to pharmacies together and used multiple aliases and fraudulent prescriptions to obtain oxycodone and hydromorphone. They then pooled, traded or shared their pills for further distribution.
Between December 2011 and October 2013, McCANN fraudulently obtained more than 16,000 oxycodone 30MG pills.
McCANN and Kaplan were arrested on December 20, 2013. On March 13, 2015, McCANN pleaded guilty to one count of conspiracy to distribute and to possess with intent to distribute oxycodone. On July 24, 2015, while he was released on bond, McCANN was arrested in the Bronx, N.Y., for purchasing heroin. His bond was revoked on August 5, 2015.
McCANN’s criminal history includes multiple arrests in Connecticut and New York for obtaining or attempting to obtain narcotics by using fraudulent prescriptions.
On November 18, 2014, KAPLAN, who also pleaded guilty, was sentenced to 57 months of imprisonment.
This matter was investigated by the DEA Tactical Diversion Squad and the Greenwich and Naugatuck Police Departments. The DEA Tactical Diversion Squad includes members from the New Haven, Hamden, Greenwich, Shelton, Bristol, Vernon and Wilton Police Departments. The case was prosecuted by Assistant U.S. Attorney Vanessa Richards.
New Hope Couple Sentenced for Stealing Social Security BenefitsRead the Press Release
PHILADELPHIA - Roger White, 58, and Audria White-Nunnally, 61, both of New Hope, Pennsylvania, were sentenced today for stealing the Social Security benefits of Roger White’s deceased relative. Roger White was sentenced to eight months in prison, his wife was sentenced to nine months in prison. Each was also ordered to complete three years of supervised release and to pay $68,462 in restitution.
The defendants pleaded guilty in October of 2015 to one count of conspiracy, three counts of wire fraud, and one count of theft of government funds. In addition to these charges, Audria White-Nunnally was also charged with two counts of making false statements to federal agents. The defendants admitted to stealing retirement benefits intended for a deceased relative of Roger White, after his relative’s death in December 1998. The defendants’ actions resulted in a loss to the government of approximately $68,462. The defendants also admitted that during the investigation they placed an elderly relative in the attic of their New Hope, PA home in an attempt to convince Social Security Administration employees that she was Roger White’s deceased relative.
The case was investigated by the Social Security Administration, Office of Inspector General, and was prosecuted by Special Assistant United States Attorney Christopher E. Parisi.
New Hamphire Residents Plead Guilty to Armed Bank Robbery ChargesRead the Press Release
Contact: Michael J. Conley
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced that Crystal Dufault, 33, and Joseph Richards, 46, both of Manchester, New Hampshire, pled guilty today in U.S. District Court to armed bank robbery and conspiracy to commit armed bank robbery. The charges arise from the August 3, 2015 armed bank robbery of Norway Savings Bank, in Freeport, Maine by Richards; the August 14, 2015 armed bank robbery of Franklin Savings Bank, in Franklin, New Hampshire by Dufault and Richards; the September 4, 2015 armed bank robbery of University Credit Union in Portland by Dufault and Richards; and the September 12, 2015 armed bank robbery of TD Bank in Lewiston, Maine by Richards.
According to court documents, a pellet gun was brandished during each of the robberies and the robber(s) absconded with $5,854 from Norway Savings Bank; $9,887 from Franklin Savings Bank; $12,308 from University Credit Union; and $9,888 from TD Bank.
The defendants face up to 25 years in prison and a $250,000 fine on each charge. They will be sentenced after completion of a presentence investigation report prepared by the U.S. Probation Office.
The joint investigation was conducted by the Franklin and Manchester, New Hampshire Police Departments; the Freeport, Portland, Lewiston, Old Orchard Beach and Saco Police Departments; the Maine State Police; and the Southern Maine Gang Task Force comprised of agents and officers from the Federal Bureau of Investigation; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the U.S. Drug Enforcement Administration; U.S. Immigration and Customs Enforcement’s Homeland Security Investigations; and the Portland, South Portland, Lewiston and Biddeford Police Departments. U.S. Attorney Delahanty praised the cooperation among these law enforcement agencies noting that “these armed bank robberies were quickly solved because local, state, and federal law enforcement agencies across two states worked closely together.”Nassau County Nurse Sentenced to Six Years for Receiving Child Pornography over the InternetRead the Press Release
Jacksonville, Florida – United States District Judge Marcia Morales Howard has sentenced Ronald Eugene Mabrey, Jr. (34, Callahan) to six years in federal prison for receiving child pornography over the Internet. He was also ordered to register as a sex offender and to forfeit his computer media. Mabrey has been in federal custody since his arrest on July 28, 2015.
According to court documents, on July 28, 2015, FBI agents and other law enforcement officers executed a federal search warrant at Mabrey’s residence. During an interview, Mabrey admitted that he had searched for, downloaded, and viewed “all types” of child pornography, and he stated that his addiction to child pornography had started about four years ago. A subsequent forensic examination of Mabrey’s laptop and a thumb drive revealed more than 190 videos and at least 4,000 images depicting child pornography.
This case was investigated by the Federal Bureau of Investigation, the Nassau County Sheriff’s Office, the Florida Department of Law Enforcement, and the Jacksonville Sheriff’s Office. It was prosecuted by Assistant United States Attorney D. Rodney Brown.
It is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Nampa Man Sentenced to Prison for Drug and Gun CrimesRead the Press Release
BOISE – Jose Enrique Olvera Jr., 51, of Nampa, Idaho, was sentenced today in United States District Court to 84 months in prison for possession of methamphetamine with the intent to distribute and unlawfully possessing a firearm, U.S. Attorney Wendy J. Olson announced. Senior U.S. District Judge Edward J. Lodge also ordered Olvera to serve four years of supervised release following his release from prison. Olvera pleaded guilty to the charges on November 3, 2015.
According to court documents, law enforcement agents executed a search warrant at Olvera’s residence on June 18, 2014. During the search, agents found methamphetamine, scales, packaging material, drug ledgers, $2,767, seven firearms, and ammunition. The firearms included a 20 gauge sawed-off shotgun with an obliterated serial number, other shotguns, rifles, and a handgun. Olvera was prohibited from possessing the firearms because he was previously convicted of the felony crime of possession of a controlled substance with intent to deliver in 2003. Law enforcement agents also determined through the course of their investigation that Olvera was a gang member.
Olvera was charged as a result of an investigation by the Treasure Valley Metro Violent Crimes Task Force, which focused on the “Norteno” Northside gang that is active in Nampa and other parts of the Treasure Valley. Fourteen individuals were indicted on drug and gun charges as a result of the investigation. So far, ten defendants have been sentenced. Guadalupe Serrano, 35, of Caldwell, was sentenced on April 21, 2015, to 75 months in prison for possession of methamphetamine with intent to distribute and for possessing firearms in furtherance of the drug trafficking crime. Nicole Danelle Nieto, 31, of Nampa, was sentenced on May 26, 2015, to 41 months in prison for distributing methamphetamine. Jose Manuel Menchaca, 35, of Nampa, was sentenced May 28, 2015, to 60 months in prison for distributing methamphetamine. On June 17, 2015, Brandi Larrea, 31, of Nampa, was sentenced to 48 months in prison for distributing methamphetamine and Tara Noelle Rivera, 30, of Nampa, was sentenced to 24 months in prison for distributing methamphetamine. Johnny Lee Martinez, 33, of Nampa, was sentenced on July 20, 2015, to 57 months in prison for distributing methamphetamine. Michael David Bradshaw, 31, of Nampa, was sentenced on August 6, 2015, to 66 months in prison for distributing methamphetamine. Kenny P. Breedlove, 35, of Porterville, California, was sentenced on October 22, 2015, to 110 months for possession of methamphetamine with the intent to distribute. Guillermo Farias Jr., 29, of Nampa, was sentenced on October 26, 2015, to time served and three years of supervised release for his role in assisting with methamphetamine distribution. Richard Lobato, 51, of Nampa, was sentenced on December 3, 2015, to 60 months for distribution of methamphetamine. Isaac Bright, 21, of Caldwell, is scheduled for sentencing on February 3, 2016. Veronica Cantu, 26, of Nampa, was arrested in Michigan in November and is set for trial in April. One defendant, Ruben Rodriguez, 36, of Nampa, has an outstanding warrant.
These cases are the result of a joint investigation by the Treasure Valley Metro Violent Crime Task Force and the Organized Crime and Drug Enforcement Task Force (OCDETF). The Treasure Valley Metro Violent Crime Task Force is comprised of federal, state and local agencies, including the Federal Bureau of Investigation; Bureau of Alcohol, Tobacco, Firearms and Explosives; Boise Police Department; Ada County Sheriff’s Office; Caldwell Police Department; Nampa Police Department; Meridian Police Department; Canyon County Sheriff’s Office; and Idaho Department of Probation and Parole. The Organized Crime and Drug Enforcement Task Force (OCDETF), includes the cooperative law enforcement efforts of the Federal Bureau of Investigation; Drug Enforcement Administration; Bureau of Alcohol, Tobacco, Firearms and Explosives; U. S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Internal Revenue Service-Criminal Investigation; and U.S. Marshals Service. The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations.
These cases are being prosecuted by the Special Assistant U.S. Attorney hired by the Treasure Valley Partnership and the State of Idaho to address gang crimes. The Treasure Valley Partnership is comprised of a group of elected officials in southwest Idaho dedicated to regional coordination, cooperation, and collaboration on creating coherent regional growth. For more information, visit treasurevalleypartners.org.
Mexican National Sentenced for Smuggling MunitionsRead the Press Release
BROWNSVILLE, Texas – A 27-year-old man from Mexico City has been ordered to prison following his involvement in smuggling munitions into Mexico through Brownsville, announced U.S. Attorney Kenneth Magidson. Ruben Sosa pleaded guilty Oct. 16, 2015, to smuggling munitions in violation of U.S. export control laws.
Today, U.S. District Judge Rolando Olvera ordered he serve a total of 24 months in federal prison. Not a U.S. citizen, he is expected to face deportation proceedings following his release from prison. At the hearing, additional evidence was presented showing communications between Sosa and other parties in Mexico negotiating the terms of agreement on an exchange for the munitions. Evidence further indicated that the munitions were smuggled into Mexico in February 2015. In handing down the sentence, Judge Olvera noted that while Sosa was a young man and had no prior criminal history, the violence in Mexico was also a consideration in the sentence.
The munitions involved in the smuggling scheme were identified by authorities as CAA Tactical Roni G2 conversion kits. The CAA Tactical Roni G2 conversion kit is an item listed on the U.S. munitions list, and as such, may not be exported without a license. The Roni G2 functions by attaching to a Glock pistol, thereby lengthening the barrel and converting the pistol into a tactical carbine. The Roni G2 also has other features including large gas ports for improved ventilation, a Picatinny rail for weapon attachments including optics and a stock for improved recoil reduction.
Sosa placed an order for 50 of these tactical conversion kits from a licensed arms dealer located just outside of Los Angeles, California, on Dec. 26, 2014. Sosa had the tactical conversion kits shipped to Brownsville, and thereafter exported into Mexico. The Defendant admitted to Judge Olvera during sentencing that he was aware he needed a license to export the munitions but did so anyway.
Sosa will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The charges are the result of an investigation conducted by Immigration and Customs Enforcement - Homeland Security Investigations. Assistant U.S. Attorney Jason Corley and Trial Attorney Thea Kendler of the National Security Division’s Counterintelligence and Export Control Section prosecuted the case.
Man Who Shot at KCK Police Charged in Federal CourtRead the Press Release
KANSAS CITY, KAN. - A man who shot at police in Kansas City, Kan., was indicted Wednesday on federal charges, U.S. Attorney Barry Grissom said.
A grand jury returned an indictment charging Ashawntus S. McCambry, 27, Kansas City, Kan., with one count of possession with intent to distribute crack cocaine, one count of possession with intent to distribute marijuana, one count of unlawful possession of a firearm in furtherance of drug trafficking and one count of unlawful possession of a firearm following a felony conviction.
McCambry initially was charged in a criminal complaint alleging the crimes occurred Dec. 22, 2015, when officers from the Kansas City, Kan., Police Department served a search warrant at McCambry’s residence in the 800 block of Quindaro Boulevard. When police tried to enter, McCambry fired three rounds in their direction. After surrendering to officers, he said he didn’t know they were police and he thought he was being robbed.
If convicted, he faces a maximum penalty of 20 years in federal prison and a fine up to $1 million on the crack cocaine charge; a maximum penalty of five years and a fine up to $250,000 on the marijuana charge; not less than 10 years and a fine up to $250,000 on the charge of unlawful possession of a firearm in furtherance of drug trafficking, and a maximum penalty of 10 years and a fine up to $250,000 on the remaining charge. The Kansas City, Kan., Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Terra Morehead is prosecuting.
OTHER GRAND JURY INDICTMENTS
Nathaniel N. Germany, Jr., 26, Kansas City, Kan., is charged with one count of carjacking, one count of brandishing a firearm during the carjacking, and one count of unlawful possession of a firearm following a felony conviction. The crimes are alleged to have occurred Sept. 1 and Sept. 8, 2015, in Wyandotte County, Kan.
If convicted, he faces a maximum penalty of 15 years in federal prison and a fine up to $250,000 on the carjacking charge, not less than seven years and a fine up to $250,000 on the brandishing charge, and a maximum penalty of 10 years on the remaining count. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Terra Morehead is prosecuting.
Samuel Below, 28, Wichita, Kan., is charged with one count of possession with intent to distribute methamphetamine and one count of unlawful possession of a firearm in furtherance of drug trafficking. The crimes are alleged to have occurred Jan. 15, 2016, in Wichita, Kan.
If convicted, he faces a penalty of not less than 5 years and not more than 40 years and a fine up to$2 million on the methamphetamine charge and a penalty of not less than five years (consecutive) and a fine up to $250,000 on the firearm charge. The U.S. Postal Inspection Service and the Sedgwick County Sheriff’s Office investigated. Assistant U.S. Attorney Debra Barnett is prosecuting.
Brandon Matthew Mounce, 38, who was living in Hutchinson, Kan., is charged with failing to register as required by the Sex Offender Registration and Notification Act. The crime is alleged to have occurred March 26, 2015.
If convicted, he faces a maximum penalty of 10 years and a fine up to $250,000. The U.S. Marshals Service investigated. Assistant U.S. Attorney Kim Martin is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
Man Who Operated New Haven Crack Ring Sentenced to 10 Years in PrisonRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that MARLON GONZALEZ, also known as “Rey,” 26, of New Haven, was sentenced today by U.S. District Judge Vanessa L. Bryant in Hartford to 120 months of imprisonment, followed by four years of supervised release, for operating a cocaine and crack cocaine distribution ring in New Haven.
According to court documents and statements made in court, a DEA New Haven Task Force investigation, which included the use of court-authorized wiretaps, revealed that between July and November 2014, GONZALEZ regularly obtained bulk quantities of cocaine from Deivy Pineda-Peguero of the Bronx, N.Y, on consignment. GONZALEZ, with the assistance of Wilfredo Garcia-Quinones, a.k.a “Poro,” and others, converted a large portion of the cocaine into crack and distributed the drug in the New Haven area. GONZALEZ then paid Pineda-Peguero with proceeds from the drug sales.
GONZALEZ has been detained since his federal arrest on November 10, 2014. At the time of his arrest, GONZALEZ had been released on bond in connection with pending state drug and gun charges. In July 2014, GONZALEZ was arrested by New Haven Police after his car was pulled over and he was found in possession of crack, a loaded firearm and a ski mask.
In addition, during the early stages of the DEA’s wiretap investigation, intercepted communications revealed that GONZALEZ had supplied a firearm to another individual. Police located the vehicle in which the other individual was traveling, arrested the individual and charged him with a state weapons offense.
On September 9, 2016, GONZALEZ pleaded guilty in federal court to one count of conspiracy to distribute 280 grams or more of cocaine base (“crack”).
Pineda, 31, and Garcia, 32, also previously pleaded guilty. On January 13, 2016, Pineda was sentenced to 71 months of imprisonment and, on December 22, 2015, Garcia was sentenced to 60 months of imprisonment.
In addition six other men who were street-level drug dealers affiliated with GONZALEZ’s organization were charged, pleaded guilty and await sentencing. They are Julius Batista, a.k.a. “Julz,” 24, of New Haven; Felix Jimenez, a.k.a. “Fee,” 28, of New Haven; Andre Scott, a.k.a. “Pooh,” 26, of New Haven; Giovany Cosme, a.k.a. “Gio,” 25, of West Haven; Jerome Rumley, a.k.a. “Rome,” 21, of New Haven, and Peter Diaz, a.k.a. “Pete,” 31, of Meriden.
The DEA New Haven Task Force includes participants from the New Haven, Hamden, Branford, Meriden, West Haven, North Haven, East Haven, Derby and Ansonia Police Departments.
This matter is being prosecuted by Assistant U.S. Attorneys Patrick Caruso and Amy Brown.
Man Sentenced to Additional 300 Months (25 Years) for Shooting Federal AgentRead the Press Release
Contact Person: Stacey D. Haynes (803) 929-3000
Columbia, South Carolina ---- United States Attorney Bill Nettles stated today that James William Lewis, a/k/a “Jessie,” a/k/a “Phoenix,” age 33, of Kings Mountain, North Carolina was sentenced to 300 months (25 years) imprisonment today in federal court. In August 2015, Lewis plead guilty to a 2nd/subsequent offense of use/possession/discharge of a firearm during a crime of violence, to wit: assault on a federal agent, in violation of Title 18, United States Code, Sections 924(c)(1)(A)(iii) and 924(c)(1)(C). Senior United States District Judge Joseph F. Anderson, Jr. imposed the sentence, which will run consecutive to the 9 year sentence that Lewis is currently serving for an armed robbery offense in the Western District of North Carolina. After serving the term of imprisonment, Lewis will be on federal supervised release for 5 years.
Evidence presented at the earlier change of plea hearing established that during the early morning hours of January 7, 2014, deputized task force agents with the Federal Bureau of Investigation’s (FBI) Charlotte Safe Streets Task Force/Violent Crime Apprehension Team were in Fort Mill, South Carolina searching for Lewis, who was wanted for a December 2013, armed robbery of a Jack-in-the-Box restaurant in North Carolina. Agents, in police attire and accompanied by York County Sheriff’s Department officers in marked units, approached the residence of Lewis’ girlfriend, Kirstie Elaine Philome Barratt, age 22, in an attempt to determine if Lewis was in the residence. After approximately 15 minutes of the agents knocking on the door and announcing their presence with a loud speaker, Barratt came to the door. Barratt, who was advised by agents that it was a crime to make a false statement to federal agents, told the agents that Lewis was not in the home, that she had not seen him for 2 months because they had broken up, and that the only other persons in the residence were her parents. Barratt gave the agents consent to search the residence. Upon completing a sweep of the residence, agents located Barratt’s parents asleep in one upstairs bedroom and noticed the door shut to another upstairs bedroom. Agents could hear a dog barking in that other upstairs bedroom, so they asked Barratt to secure the dog so they could search the bedroom. Barratt opened the bedroom door, went in and came out with the dog, shutting the door behind her. Agents then went into the bedroom and found Lewis crouched in the corner with his weapon drawn. Gunfire ensued and an FBI task force agent was shot 3 times by Lewis, who was also shot in the legs. Both Barratt and Lewis were taken into custody. Barratt later advised agents that she knew Lewis was in the residence, that she knew he was wanted for the robbery, that she thought he was going to hide in the attic, and that when she entered the bedroom to retrieve the dog, she saw him in the corner holding the gun, but did not tell the agents before allowing them to enter the bedroom. After being taken into custody, Lewis waived his rights and admitted to telling his girlfriend that it was going to end up in a shootout with officers. Lewis also admitted that he and his girlfriend’s plan was for him to hide in the attic, but he decided that he didn’t want to hide “like a puppy,” so he positioned himself in the bedroom with his gun drawn because he wanted to be shot. Lewis admitted that when the officers entered the bedroom, he had his gun pointed at the officer and that the officer had a right to shoot him.
On October 22, 2014, Barratt plead guilty to making a false statement to a federal agent, in violation of Title 18, United States Code, Section 1001. At Barratt’s sentencing on December 15, 2014, the court granted the government’s motion for an upward departure from the federal guidelines sentencing range of 0 to 6 months, noting that this was a “rare” case and that Barratt “knowingly placed a law enforcement officer’s life in jeopardy” by her false statement. Barratt was sentenced to 24 months (2 years) imprisonment, to be followed by 3 years of supervised release.
In July 2015, Lewis was sentenced to 108 months (9 years) in federal court in the Western District of North Carolina for the December 2013, robbery of the Jack-in-the-Box restaurant and possession of a firearm during that crime of violence, to wit: robbery. As noted above, Lewis’ 300 months (25 year) sentence will run consecutive to the North Carolina federal sentence. Lewis also has prior North Carolina state convictions for possession of cocaine (1999) and larceny of a motor vehicle (2000).
The case was investigated by the FBI, the York County Sheriff’s Department, and the South Carolina Law Enforcement Division (SLED), and was prosecuted as part of the joint federal, state and local Project CeaseFire initiative, which aggressively prosecutes firearm cases. Assistant United States Attorney Stacey D. Haynes of the Columbia office handled the case.
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Los Angeles Man Charged with Running Multi-million Dollar Foreclosure Rescue Scam in Visalia and SalinasRead the Press Release
FRESNO, Calif. — Martin Calzada, 28, of Los Angeles, was arraigned today in Fresno, charged in connection with a scheme to defraud homeowners facing foreclosure, United States Attorney Benjamin B. Wagner announced.
On December 31, 2015, a federal grand jury returned an indictment against Calzada, charging with conspiracy to commit mail fraud and mail fraud. In court today, Calzada entered a plea of not guilty. His next court date is a status conference and is set for March 21, 2016.
According to court documents, between August 2010 and October 2011, Calzada, and other employees of Star Reliable Mortgage, which had offices in Bakersfield, Visalia, and Salinas, targeted distressed homeowners with a fraudulent “loan elimination” scheme. Star Reliable charged clients an upfront fee — ranging from $2,500 to $4,500 — as well as monthly fees, based on false promises that the clients could own their homes “free and clear” as a result of Star Reliable’s services. In furtherance of the scheme, Calzada and other employees filed at county recorders’ offices fraudulent documents on behalf of the homeowner-clients that purported to replace the legitimate property trustees with fictitious trusts affiliated with Calzada and Star Reliable, all in an effort to “cloud title” and halt or stall the foreclosure process. Additionally, Calzada, and other employees working at his direction, told clients to stop paying their mortgages. They also falsely represented that each client had one million dollars in a U.S. government account that could be used to pay off a homeowner’s mortgage.
Instead of owning their homes “free and clear,” many of Star Reliable’s clients lost their homes in foreclosure. The scheme caused more than 100 homeowner-clients to pay approximately $875,000 to Star Reliable and lending institutions to lose more than $4 million. At least $270,000 of the money paid to Star Reliable by homeowner-clients was funneled back to Calzada.
This case is the product of an investigation by the Federal Bureau of Investigation and the Tulare County District Attorney’s Office. Assistant United States Attorney Patrick R. Delahunty is prosecuting the case.
If convicted, Calzada faces a maximum statutory penalty of 30 years in prison and a $1 million fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Local Woman Pleads Guilty to Embezzlement and Tax ChargesRead the Press Release
St. Louis, MO – ANASTASIA GRZESKOWIAK pled guilty today to embezzling $2.9 million from the account of a disabled individual whose financial affairs she was entrusted with managing.
According to court documents, beginning in 2000, an individual with whom Grzeskowiak was previously acquainted developed a blinding eye disease that significantly impaired his vision and ability to read and thus to manage his own financial affairs. In June 2003, that individual asked Grzeskowiak to assist him in paying his personal bills, which she did until April 2013.
Between June 2006 and continuing through April 2013, Grzeskowiak, forged her victim’s signature on more than 800 checks which she made out to herself, endorsed and used to pay her personal expenses, the expenses of others and to gamble. In total, she obtained approximately $2,918,090 from the victim without his authorization.
Additionally, Grzeskowiak filed false tax returns for 2010 through 2012, understating her gross income from the illegal activity described above, resulting in a tax loss of $506,496.
Grzeskowiak, St. Charles, MO, pled guilty to one felony count of wire fraud and three felony counts of filing false tax returns. She appeared before United States District Judge Carol E. Jackson. Sentencing has been set for April 20, 2016.
Wire fraud carries a maximum penalty of 20 years in prison and/or fines up to $250,000; each of the tax charges carry a maximum penalty of 3 years in prison and/or fines up to $100,000. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the Federal Bureau of Investigation and Internal Revenue Service-Criminal Investigation. Assistant United States Attorney Richard Finneran is handling the case for the U.S. Attorney's Office.
Lawton Man Charged with Sex Trafficking and Kidnapping of a JuvenileRead the Press Release
Oklahoma City, Oklahoma – Today, CHARLES MICHAEL SEGALOFF (a/k/a "Michael Makai," "Mike Sage," "Daddy," "Poppa," and "Master"), age 59, of Lawton, Oklahoma, has been indicted by a federal grand jury and charged with traveling with intent to engage in illicit sexual conduct with a juvenile, kidnapping, sex trafficking, and enticement of a juvenile, announced Mark Yancey, Acting United States Attorney for the Western District of Oklahoma.
According to the indictment, from December 7, 2015, through December 15, 2015, Segaloff traveled from Lawton, Oklahoma, to Greenwich, New York, and returned to Lawton with a female juvenile under 18 years of age for the purpose of engaging in illicit sexual conduct and to hold the juvenile to form a polyamorous family. Segaloff had previously been charged by complaint in federal court in Oklahoma City and is currently being held in the Logan County Jail.
If convicted, Segaloff faces up to life in prison, a $250,000 fine, and lifetime registration as a sex offender. The public is reminded that the indictment is merely an accusation and that the defendant is presumed innocent unless and until proven guilty. Reference is made to court records for further information.
This case is the result of an investigation by the Federal Bureau of Investigation, the Lawton Police Department, and the New York State Police. The case is being prosecuted by Assistant U.S. Attorney Robert Don Gifford, II, and Special Assistant U.S. Attorney Mark Stoneman.
Kidnapper Sentenced to 15 Years in PrisonRead the Press Release
PHILADELPHIA - Basil Buie, 23, of Philadelphia, PA, was sentenced today to 15 years in prison for his role in a botched robbery and kidnapping that involved a jewelry store employee. Buie, a/k/a “Basil Tucker,” pleaded guilty on October 7, 2015 to conspiracy, kidnapping, and attempted Hobbs Act robbery. His two co-defendants - Khayree Gay and Salahudin Shaheed - also pleaded guilty.
Shaheed recruited Buie and Gay to rob National Watch and Diamond Exchange, at 101 S. 8th Street in Philadelphia to obtain luxury watches, jewelry, and money which Shaheed said could be found there. The defendants conducted surveillance of National Watch and its employees from a parking lot at 733 Chestnut Street, to identify and then, in disguise, abduct an employee from whom they would forcibly obtain keys, security codes, and the code to the company’s safe from which the robbers would steal luxury watches, jewelry, and money.
On April 4, 2015, the defendants watched an employee that Shaheed had targeted. When the employee entered the garage and approached her car, Shaheed and Buie, wearing masks, gloves, and sunglasses, confronted the victim, Shaheed assaulted her with a Taser, and they kidnapped her.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and is being prosecuted by Assistant United States Attorneys Jeanine Linehan and Maureen McCartney.
Jury Convicts Syracuse Man in Heroin and Crack Cocaine ConspiracyRead the Press Release
SYRACUSE, NEW YORK – A federal jury today convicted Derrick Wilson, a/k/a D-Ellis and Sonny Black, age 36, of Syracuse, of participating in a heroin and crack cocaine conspiracy, following a week-long trial.
The announcement was made by United States Attorney Richard S. Hartunian, Special Agent in Charge James J. Hunt, New York Division, Drug Enforcement Administration (“DEA”) and Syracuse Police Chief Frank L. Fowler.
“This verdict is the culmination of a long investigation into the conduct of people who poisoned our community and destroyed lives by pushing large quantities of heroin and crack cocaine,” stated United States Attorney Richard S. Hartunian. “Thanks to law enforcement collaboration, the leader and all twelve other charged defendants have been convicted, and this drug crew has been dismantled. We are committed to continuing to work together to take drug dealers off the streets of Syracuse and beyond.”
DEA Special Agent in Charge James J. Hunt stated, “Heroin and crack cocaine trafficking is a scourge throughout American cities, large and small. No city is immune from drug addiction as long as there are drug suppliers profiting off the sale of poison. Today's conviction of Derrick Wilson has sent a message to drug traffickers that their illegal profit off drug sales will only lead them to jail and long prison sentences. I commend the U.S. Attorney’s Office Northern District, the Syracuse Police Department and the DEA’s Syracuse Resident Office for their diligent efforts throughout this investigation, prosecution and conviction.”
Syracuse Police Chief Frank L. Fowler stated, “Our department is pleased with the outcome of this federal prosecution. Our joint efforts will make Syracuse safer and we intend to continue these efforts against those that deal or traffic in drugs in our communities. We look forward to continuing our joint efforts in the coming year.”
Wilson faces at least 20 years and up to life in prison when he is sentenced on May 20, 2016 by Chief United States District Judge Glenn T. Suddaby. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a judge based on the U.S. Sentencing Guidelines and other statutory factors.
The evidence at trial, some of which was obtained through court-ordered wiretaps, showed that: Wilson was the head of a conspiracy to distribute large quantities of crack cocaine and heroin in the Syracuse area from April 2013 through June 18, 2014, when arrests were made; Wilson made arrangements for heroin and cocaine powder from New York City to be delivered to him in Syracuse; Wilson had the cocaine powder processed into crack cocaine and packaged for sale; Wilson had the heroin packaged in distinctly marked plastic bags for “branding” purposes and distribution; and Wilson had members of the conspiracy sell the crack cocaine and heroin.
Wilson represented himself during the trial, with an assigned attorney present to advise him on legal matters. He was the last of thirteen defendants to be convicted of participating in this conspiracy to distribute heroin and crack cocaine. Wilson’s twelve co-defendants all pled guilty and six of them have been sentenced, while six are scheduled to be sentenced in February and March, as follows:
Name
Age
Residence
Sentence
Jeffrey Dowdell
37
Syracuse, NY
Scheduled for 2/25/2016
Tashawn Albert
28
Syracuse, NY
Scheduled for 2/26/2016
Kyle Dowdell
28
Syracuse, NY
Scheduled for 2/12/2016
Quonta Albert
23
Syracuse, NY
60 months
General Davis, Jr.
29
Clay, NY
130 months
Willie Strong, Jr.
37
Liverpool, NY
120 months
Jamall Harris
36
Syracuse, NY
Scheduled for 3/4/2016
James Handford
38
Syracuse, NY
120 months
Zephaneea Dowdell
33
Syracuse, NY
Scheduled for 3/1/2016
Lashandrea Johnson
31
Syracuse, NY
13 months
James Hudson
25
Syracuse, NY
60 months
Darnyl Apgar
28
Syracuse, NY
Scheduled for 2/29/2016
This case was investigated by the United States Drug Enforcement Administration (“DEA”) and the Syracuse Police Department, with assistance from the Federal Bureau of Investigation (“FBI”), and is being prosecuted by Assistant U.S. Attorneys Carla Freedman and Nicolas Commandeur.
Judge Orders York County Trucking Company to End Repeated Violations of Employment Tax LawsRead the Press Release
Yesterday, a federal court in Rock Hill, South Carolina, ordered Tony McMillan and his trucking company, which he operated under the names T-N-T of York County Inc. and TM Trucking of the Carolinas LLC, to stop violating their employment tax reporting, deposit and payment obligations. The Judgment and Permanent Injunction by Consent requires McMillan and the business to timely file all employment tax returns, to make all required deposits of employment and unemployment taxes and to certify to the Internal Revenue Service (IRS) that they have made these deposits. The injunction also prohibits the defendants from making other disbursements if the business’s current employment taxes are not paid. The injunction also requires McMillan to notify the IRS of any new company he owns, manages, or works for over the next five years.
The government’s complaint alleged that McMillan operated the trucking company since at least 2008 and was routinely late in filing its employment tax returns and paying its employment taxes, when he did so at all. According to the complaint, McMillan also failed to pay over the taxes withheld from his employees’ paychecks. By the time the complaint was filed in June 2015, T-N-T of York County and TM Trucking of the Carolinas together owed more than $2.7 million in federal employment and unemployment taxes for various periods from 2009 through 2014, the complaint stated. The complaint alleged that this pyramiding of taxes had continued in spite of repeated efforts by the IRS to collect the tax and to help McMillan and the business cure the violations.
Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division thanked IRS Field Collection and its revenue officer for investigating and preparing the civil case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Jicarilla Apache Man Sentenced for Assaulting a Federally Commissioned Tribal Police OfficerRead the Press Release
ALBUQUERQUE – Lawrence Roybal, 53, a member of the Jicarilla Apache Nation who resides in Dulce, N.M., was sentenced yesterday in federal court in Albuquerque, N.M., to 60 months in prison followed by three years of supervised release for assaulting a tribal police officer who was commissioned as a federal officer.
“The Department of Justice is dedicated to supporting the courageous men and women who wear the badge and help uphold our Constitution,” said U.S. Attorney Damon P. Martinez. “We will hold accountable those who threaten our public safety by attacking and seeking to harm our nation’s peacekeepers.”
Special Agent in Charge Terry Wade of the FBI’s Albuquerque Division said, “The law enforcement officers who risk their lives every day to keep us safe deserve the best protection we can give them. The FBI is proud to have worked on this case with the U.S. Attorney's Office and the Jicarilla Apache Tribal Police Department. We hope this case sends a clear message this type of crime will not be tolerated.”
“All people are sacred; actions must be made in a split second. The officer involved in this case exhibited a keen insight to remain safe and capture a very dangerous offender without using deadly force,” said Chief Sylvester Stanley of the Jicarilla Apache Tribal Police. “We must remember that all officers have families that love them, and at the end of the day officers must go home safely to be with their families. The Jicarilla Apache Nation is proud of all our brothers in blue.”
Roybal was arrested in May 2015, on a criminal complaint charging him with assaulting an officer with a dangerous weapon. According to the criminal complaint, Roybal attacked a Jicarilla Apache Tribal police officer with a pitchfork on May 11, 2015, in Dulce, N.M., which is within the Jicarilla Apache Indian Reservation in Rio Arriba County, N.M.
Roybal was indicted on June 9, 2015, and charged with assaulting a federal officer who was engaged in the performance of his official duties. The indictment alleges that, at the time of the assault, the victim was a tribal officer commissioned as a special federal officer by the BIA.
On Sept. 3, 2015, Roybal entered a guilty plea to the indictment without the benefit of a plea agreement.
This case was investigated by the Farmington office of the FBI and the Jicarilla Apache Tribal Police Department, and was prosecuted by Assistant U.S. Attorney Raquel Ruiz-Velez.
Hyde Park Man Pleads Guilty to Child Pornography ChargesRead the Press Release
BOSTON – A Hyde Park man pleaded guilty yesterday in U.S. District Court in Boston to child pornography charges.
Geraldo Christiano DeSouza, 44, pleaded guilty to one count of possession of child pornography, one count of distribution of child pornography, one count of sexual exploitation of children and two counts of coercion and enticement of a minor to engage in sexual activity. U.S. District Court Judge George A. O’Toole scheduled sentencing for April 26, 2016.
In October 2012, law enforcement identified DeSouza after an undercover officer accessed a peer-to-peer file sharing program and discovered another user offering to share files containing child pornography. Investigators determined that the child pornography had been distributed from DeSouza’s residential address and executed a search warrant. The search uncovered multiple laptops and other computer media in DeSouza’s bedroom. Forensic review of the devices revealed numerous files of child pornography as well as evidence that DeSouza had engaged in sexual activity with a minor. Among other things, DeSouza “chatted” with his minor victims using various forms of social media and a webcam, and directed the minors to display themselves in a sexually explicit manner. Using his cell phone, DeSouza also filmed himself having sexual intercourse with one of his minor victims.
Under the terms of the plea agreement, the parties have agreed to recommend to the Court a sentence of 15 years in prison and five years of supervised release. Following release from prison, DeSouza will be required to register as a sex offender and will face immigration proceedings and removal from the United States.
The charge of possession of child pornography provides a sentence of no greater than 10 years in prison. The charge of distribution of child pornography provides a mandatory minimum sentence of five years and no greater than 20 years in prison. The charge of exploitation of children provides a mandatory minimum sentence of 15 years and no greater than 20 years in prison. The charge of coercion and enticement of a minor to engage in sexual activity each provide a mandatory minimum sentence of 10 years and no greater than a lifetime in prison. All charges also provide for five years of supervised release and a fine of $250,000. 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.
United States Attorney Carmen M. Ortiz; Matthew Etre, Special Agent in Charge of Homeland Security Investigations in Boston; Colonel Richard D. McKeon, Superintendent of the Massachusetts State Police; and Boston Police Commissioner William Evans, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Eve A. Piemonte.
The case is brought as part of Project Safe Childhood. In 2006, the Department of Justice created Project Safe Childhood, a nationwide initiative designed to protect children from exploitation and abuse. Led by the U.S. Attorneys’ Offices and the DOJ’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend, and prosecute individuals who exploit children, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov/.
Houston Sex Trafficking Ring Leader Gets Life in Federal PrisonRead the Press Release
A woman behind a 14-defendant sex trafficking ring operating in Houston has been ordered to federal prison for life, announced U.S. Attorney Kenneth Magidson for the Southern District of Texas along with Special Agent in Charge Perrye K. Turner for the FBI Houston Division, Special Agent in Charge Brian Moskowitz of Immigration and Customs Enforcement – Homeland Security Investigations (ICE-HSI) and Special Agent in Charge Richard Goss of IRS-Criminal Investigation (CI).
A federal jury convicted Hortencia Medeles-Arguello aka Raquel Medeles Garcia, Raquel Medeles Garcia or Tencha, 68, on April 24, 2015, following a 10-day trial and approximately four hours of deliberations. She was convicted on all counts - conspiracy to commit sex trafficking, conspiracy to harbor aliens, aiding and abetting to commit money laundering and conspiracy to commit money laundering.
This landmark sex trafficking case is one of the most significant in scope and magnitude to be tried to a verdict of guilty on all counts and one of the few in which as many as 12 victims of an international sex trafficking scheme came forward to testify at trial. Twelve victims rescued in connection with this case testified at trial regarding the horrors of their ordeals, beginning with being recruited in their home countries, only to be forced into prostitution against their will in the United States. Some victims were as young as 14 when the traffickers recruited them, using fraud and false pretenses to lure them into the traffickers’ control.
“The importance of this case cannot be underscored,” said U.S. Attorney Magidson. “These were human beings – women and children – who were treated as a commodity. They came from their home countries hoping for a better life, only to be enslaved and forced into unspeakable acts. This is a local, national and international issue, but also a humanitarian issue. We will continue to take action against these egregious offenders and seek to obtain the stiffest penalties in order to send a clear message that human trafficking will not be tolerated in this district.”
Today, U.S. District Judge David Hittner for the Southern District of Texas, who presided over the trial, handed Tencha a sentence of life in federal prison. At the hearing, additional testimony from six of the victims was also presented. They asked the judge to punish the defendant for the impact she had on their lives.
In addition, 15 real properties and other assets for a value of about $2.5 million will be forfeited to the United States having been found to have been purchased with sex trafficking proceeds. The funds will be used to make restitution to the victims of this horrible crime.
“Let this sentence send a message that lives are not to be bought and sold,” said Special Agent in Charge Turner. “The Human Trafficking Rescue Alliance (HTRA) seeks to rescue those forced into this modern day slavery and hold accountable those who wish to profit from the abuse of others. If you have information about human trafficking, we urge you to contact the National Human Trafficking Hotline at 1-888-373-7888.”
“Investigations and the subsequent criminal prosecution like this one highlight the significant collective and collaborative efforts of law enforcement agencies in greater Houston that are involved in the fight against human trafficking,” said Special Agent in Charge Moskowitz. “This should also serve as a warning to all individuals and criminal groups involved in the trafficking of minors and women that we are determined to expend the resources necessary to investigate and prosecute to the full extent of the law all that are involved in this heinous crime.”
Testimony revealed that pimps recruited the young girls by convincing them they were in love, making threats to their families as well as threatening the girls themselves. Testimony revealed Tencha knew that many of the girls prostituted at her establishment were either underage or victims of the beatings by their pimps.
On the first full day of trial, the jury heard from one of the victims in the case. She detailed the horrific conditions she faced at the hands of the defendant and others, to include being forced into having sex at age 14 after she had come to this country in search of a better life. She described how she was forced to comply with demands at gunpoint and locked in a room. She was eventually impregnated by a “customer” and was moved to another area of the bar because she was not worth as much once she became pregnant. Following the move, she found a way to escape with the help of a customer who had befriended her.
“Today’s sentencing closes the book on a heinous criminal organization that profited from exploiting innocent women and minors in the worst possible way,” said Special Agent in Charge Goss. “IRS special agents are committed to dismantling the financial infrastructure of criminal enterprises of this nature and removing any financial incentive to exploit innocents.”
Evidence at trial indicated that Tencha made more than $1.6 million in a 19-month period by supplying the upper floor of her cantina for prostitution. The evidence further revealed that many of the prostitutes were either minors or forced to engage in sex acts at the defendant’s bar. The jury heard that Tencha had engaged in harboring illegal aliens, many who were forced into prostitution for more than 13 years.
She will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
All of Tencha’s co-defendants who were in custody have pleaded guilty for their respective roles in the conspiracy. Many admitted they worked for Las Palmas II, a cantina located in Houston. They all knew the cantina concealed, harbored and shielded illegal aliens who worked there from detection by law enforcement and that the owners were profiting from such concealment. As part of their employment, they aided in the operation of the business and their conduct substantially facilitated the concealment, harboring and shielding of the employees and patrons of the Las Palmas II, whom they all knew were illegally in the United States. Other co-defendants pleaded guilty to helping Tencha keep track of the monies she made, including investing it in properties she purchased in the Houston area.
Abel Medeles aka Chito, 67, Tencha’s brother, operated the Las Palmas II parking lot. It was part of his job to notify his co-conspirators inside the cantina of any law enforcement presence he observed in order for his co-conspirators to be able to conceal from law enforcement the illegal activities in the Las Palmas II. Similarly, on at least one occasion, Odelia Hernandez, 47, Tencha’s sister, told co-conspirators to lock the doors when she realized law enforcement was coming. Medeles was sentenced to 55 months and ordered to pay a $2,000 fine, while Hernandez received a sentence of 66 months and must pay a $1500 fine.
Eduardo Guzman Gonzales aka Miguel Rojas or El Pantera, 33, and Alberto Mendez Flores aka Ardilla, 27, managed the cantina. They paid Tencha $20,000 each week out of the money received from the operation of the Las Palmas II and kept all the monies received in excess of that amount. Both men received sentences of 88 months in federal prison.
Jose L. Uraga aka Wicho, 36, provided false/fraudulent identifications to employees, to include females working at Las Palmas II and was sentenced to 28 months. Jorge Antonio Teloxa-Barbosa aka Eli, 31, testified at trial to his part in the conspiracy. He also managed the cantina with Guzman and Mendez and paid Tencha $20,000 each week out of the money received from the operation of Las Palmas II, keeping all the monies received in excess of that amount. He received a sentence of 37 months.
Graciela Medeles Ochoa, 37, Tencha’s daughter, assisted Tencha in counting the proceeds obtained from Las Palmas II. She also negotiated cashier’s checks for her mother and sister, Delia Diaz, 51. The money used to obtain the cashier’s checks came from the sex trafficking violations occurring at Las Palmas II. Ochoa, who also testified about her mother’s unlawful conduct, was sentenced to 18 months. Diaz received 71 months for money laundering. Another of Tencha’s daughters, Diana Medeles Garcia aka Diana Garcia Marquez, 50, testified that her mother had been running brothels since she was 13 years old. She received 21 months for aiding and abetting to harbor illegal aliens.
Guadalupe Valdez Lugo aka Lupe, 58, worked as a manager at Las Palmas II, overseeing the female workers as well as the regular employees. She also testified at trial about Tencha’s unlawful conduct and received a sentence of 25 months as well as a $5,000 fine.
Another of Tencha’s sisters, Lilia Medeles Cerda aka Lilly, 66, received a sentence of 52 months for conspiracy to harbor illegal aliens. Talat Crippin aka Chacho, 27, who was married to one of Tencha’s granddaughters pleaded guilty to being a lookout for Tencha’s brothel and received 41 months.
David Garcia, 46, Techa’s son, was convicted of aiding and abetting to harbor illegal aliens and will be sentenced next month.
Another defendant, Alfonso Diaz-Juarez aka Ponco or El Grenas, 45, and a Mexican national, is a fugitive and a warrant remains outstanding for his arrest. Anyone with information about his whereabouts is asked to contact the FBI at 713-693-5000. A Clear Channel Outdoor digital billboard campaign launched in December across the greater Houston area touted an up to $50,000 reward for information leading to the location and arrest of Diaz-Juarez.
The investigation leading to the filing of criminal charges was the result of a three-year investigation conducted by members of the HTRA in Houston, which includes the FBI, ICE-HSI, Harris County Sheriff’s Office, IRS-CI, Texas Alcoholic and Beverage Commission, Department of State, Texas Department of Public Safety and the Houston Police Department.
Assistant U.S. Attorneys Ruben R. Perez and Joe Magliolo are prosecuting the case.
Houston Fugitive Indicted for Production of Child PornographyRead the Press Release
HOUSTON – A 36-year-old man who resided in Houston is being sought following the return of a four-count indictment on varying charges related to the production of child pornography, announced U.S. Attorney Kenneth Magidson.
John Ferguson was indicted today for production, receipt, access with intent to view and possession of child pornography. It is believed that he has fled in order to avoid being arrested on these charges. He is considered a fugitive and a warrant remains outstanding for his arrest.
A criminal complaint, filed last month, alleges that Ferguson was accessing numerous files from a website known to contain child pornography. A search warrant was conducted at Ferguson’s residence, at which time authorities seized several items, including computers. On those devices, the criminal complaint alleges that authorities discovered more than 1,000 videos and 13,000 images of child pornography.
The charges allege that in some of the videos an underage girl is seen being sexually assaulted and in lewd and lascivious poses that show her genitalia. According to the criminal complaint, the girl is seen on heavily stained carpet and on a bathroom counter during these acts. The charges indicate that these items match those seen in Ferguson’s residence. What appears to be an adult male with matching characteristics of Ferguson is also seen in the videos, according to the complaint.
As part of the investigation, the images/videos seized were sent to the National Center for Missing and Exploited Children (NCMEC). Subsequently, NCMEC identified several videos that appeared to have been produced by Ferguson, according to the charges. Based on the work of NCMEC and FBI, the child in the videos has been identified.
Ferguson is described as a 36-year-old white male, 5'10" and weighing approximately 180 pounds with brown hair and brown eyes. Investigators believe Ferguson may be driving an older model, silver, two-door Ford Focus. Crime Stoppers of Houston is offering up to $5,000 for information leading to the charging and arrest of Ferguson. If you have information about him or his whereabouts, please call the Crime Stoppers tip line at 713-222-TIPS (8477) or the FBI Houston Field Office at 713-693-5000. Tips may also be submitted to the FBI online at https://tips.fbi.gov/. As a public service to the community, Clear Channel Outdoor is donating space and time on its digital billboards throughout the area and statewide to publicize the reward and feature a photo of Ferguson.
If convicted of the production charges, Ferguson faces a mandatory minimum of 15 and up to 30 years in federal prison. For the charge of receipt of child pornography also faces a mandatory minimum of five years up to a maximum of 20. On each count of access with intent to view and possession of child pornography, Ferguson faces another maximum 10 years of imprisonment. Each conviction is also punishable by a possible $250,000 fine. Further, If convicted, upon completion of any prison term imposed, Ferguson faces a maximum of life on supervised release during which the court can impose a number of special conditions designed to protect the children and prohibit the use of the Internet. He would also be required to register as a sex offender.
This case, prosecuted by Assistant U.S. Attorney Sherri Zack, 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."
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.Hobbs Woman Sentenced to Five Years for Federal Methamphetamine Trafficking ConvictionRead the Press Release
ALBUQUERQUE – Ida Rodriguez, 47, of Hobbs, N.M., was sentenced today in federal court in Las Cruces, N.M., to 60 months in federal prison followed by four years of supervised release for violating federal narcotics trafficking laws.
Rodriguez was arrested on June 10, 2015, on a criminal complaint charging her with possession with intent to distribute methamphetamine in Lea and Doña Ana Counties, N.M. According to the complaint, Rodriguez sold methamphetamine to an undercover DEA agent in July 2014 and Aug. 2014. It also alleged that on Aug. 16, 2015, deputies of the Lea County Sherriff’s Office (LCSO) executed a traffic stop on Rodriguez and found her to be in possession of 168 grams of methamphetamine.
On Aug. 19, 2015, Rodriguez pled guilty to a three-count felony information charging her with distribution of methamphetamine and possession of methamphetamine with intent to distribute. In entering the guilty plea, Rodriguez admitted that (1) she sold 28 grams of methamphetamine to an undercover agent in Hobbs on July 29, 2014; (2) she sold 56 grams of methamphetamine to an undercover agent in Las Cruces, N.M., on Aug. 4, 2014, and (3) on Aug. 16, 2014, she was stopped by LCSO deputies for a traffic violation during which the deputies found 168 grams of methamphetamine in her vehicle. Rodriguez further admitted that she had obtained the methamphetamine in Phoenix, Ariz., and planned to sell it in Hobbs.
This case was investigated by the Las Cruces office of the DEA and the HIDTA Lea County Drug Task Force with assistance from the 5th Judicial District Attorney’s Office for the State of New Mexico. Assistant U.S. Attorney Terri J. Abernathy of the U.S. Attorney’s Las Cruces Branch Office prosecuted the case.
The HIDTA Lea County Drug Task Force is comprised of officers from the Lea County Sheriff’s Office, Hobbs Police Department, Lovington Police Department, Eunice Police Department the Tatum Police Department and the Jal Police Department, and is part of the NM HIDTA Region VI Drug Task Force. The High Intensity Drug Trafficking Areas (HIDTA) program was created by Congress with the Anti-Drug Abuse Act of 1988. HIDTA is a program of the White House Office of National Drug Control Policy (ONDCP) which provides assistance to federal, state, local and tribal law enforcement agencies operating in areas determined to be critical drug-trafficking regions of the United States and seeks to reduce drug trafficking and production by facilitating coordinated law enforcement activities and information sharing.
Harrison County, WV man sentenced for heroin traffickingRead the Press Release
CLARKSBURG, WEST VIRGINIA – Jeremiah Robert Dodrill, 34, of Spelter, West Virginia, was sentenced today to 21 months in prison for heroin trafficking, United States Attorney William J. Ihlenfeld, II, announced. Jeremiah Dodrill sold heroin in October 2014 near Spelter Park, a playground located in Harrison County, West Virginia. He pled guilty in October 2015 to one count of “Distribution of Heroin within 1,000 feet of a Protected Location.” Jeremiah Dodrill’s wife, Kasandra Faith Dodrill, 27, also of Spelter, allowed the Harrison County, West Virginia residence that she shared with Jeremiah Dodrill to be used to store and distribute heroin. She pled guilty in October 2015 to one count of “Maintaining Drug-Involved Premises – Aiding and Abetting.” She was sentenced today to 4 months in prison. Assistant U.S. Attorney Zelda Wesley prosecuted the case on behalf of the government. The Greater Harrison County Drug and Violent Crime Task Force, a HIDTA-funded initiative, investigated. U.S. District Judge Irene M. Keeley presided.Gloucester County, New Jersey Man Sentenced to Six Years in Prison for Operating Mortgage Foreclosure Rescue, Real Estate Ponzi SchemeRead the Press Release
CAMDEN, N.J. – A Woolwich Township, New Jersey, was sentenced today to 72 months in prison for scamming distressed homeowners into giving him their houses and then soliciting fake real estate investments from private investors – secured by those same properties – that netted him more than $3 million in illicit profits, U.S. Attorney Paul J. Fishman announced.
Randy Poulson, 44, previously pleaded guilty before U.S. District Judge Renée Marie Bumb to Count One of an indictment charging him with mail fraud. Judge Bumb imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
Poulson owned and operated Equity Capital Investments, LLC and Poulson Russo LLC and was the former president of the South Jersey Real Estate Investors Association. Paulson gave speeches, seminars, monthly dinners and various private tutorial sessions, purporting to teach real estate investing tips to individuals who paid fees to attend.
Poulson engaged in a two-pronged scheme. First, he promised to pay the mortgages of distressed homeowners facing foreclosure if they sold their homes to him. Using this method, Poulson obtained the deeds to more than 25 distressed homeowners’ residences, causing them to vacate the homes so renters could move in. Afterwards, Poulson then stopped making the monthly mortgage payments, causing those mortgages to go into foreclosure without the distressed homeowners’ knowledge.
In the second part of the scheme, Poulson solicited seminar attendees and other private investors to invest in Equity Capital Investments, which purportedly bought and sold real estate. Poulson told the investors that their money would be used to acquire and rehabilitate a property, which Poulson claimed he would rent out and then sell for a 10 to 20 percent return on the investment.
The properties for which Poulson solicited the investments were those he acquired in the first part of the scheme. Although Poulson claimed that he would use funds to acquire and rehabilitate those properties, Poulson spent the money on personal expenses and to repay other investors. As a result of the scheme, Poulson was able to fraudulently obtain more than $3 million from investors.
In addition to the prison term, Judge Bumb sentenced Poulson to three years of supervised release and ordered him to pay $2.58 million in restitution.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special
Agent in Charge Richard M. Frankel, in Newark, for the investigation leading to today’s sentencing.
The government is represented by Attorney in Charge R. Stephen Stigall of the U.S. Attorney’s Office Criminal Division in Camden.
Defense counsel: Gilbert J. Scutti Esq., Somerdale, New Jersey
Glendale Men Charged with Bank Fraud Conspiracy Related to Trademark ScamRead the Press Release
WASHINGTON – Two Glendale residents have been charged in a superseding indictment in connection with a bank fraud scheme involving the proceeds of a mass mailing scam targeting holders of U.S. trademarks.
Artashes Darbinyan, 36, and Orbel Hakobyan, 41, were charged in a superseding indictment that was unsealed today in Los Angeles. The superseding indictment charges both defendants with one count of conspiracy to commit bank fraud. Darbinyan was also charged with four counts of mail fraud, three counts of aggravated identity theft, two counts of concealment money laundering and one count of bank fraud for a separate scheme. Hakobyan was also charged with one count of bank fraud.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division; U.S. Attorney Eileen M. Decker of the Central District of California; Inspector in Charge Robert Wemyss of the U.S. Postal Inspection Service (USPIS), Los Angeles Division; Inspector in Charge David G. Bowers of the USPIS, Washington, D.C. Division; and Special Agent in Charge Erick Martinez of the IRS-Criminal Investigation, Los Angeles Field Office made the announcement.
“These defendants are charged with taking money from victims for services they never intended to render,” said United States Attorney Eileen M. Decker. “Although they used technology in an attempt to further and to conceal their crimes, they will now face prosecution.”
According to the superseding indictment, Darbinyan operated and controlled Trademark Compliance Center (TCC) and Trademark Compliance Office (TCO), which purported to offer trademark registration and monitoring services. The superseding indictment alleges that, through TCC and TCO, Darbinyan sent mass solicitations offering, for a fee, trademark registration and monitoring services to holders of trademarks recently registered with the U.S. Patent and Trademark Office, services which Darbinyan did not intend to, and did not, provide. To accomplish this scheme, Darbinyan used the names of other persons to open accounts for TCC and TCO at “virtual office centers” (i.e., businesses that offered call answering and mail forwarding services) in the Washington, D.C., and Los Angeles areas, and directed employees of the Washington, D.C.-area virtual office centers to forward mail addressed to TCC and TCO – envelopes containing payments from trademark holders – to the virtual office centers in the Los Angeles area, the superseding indictment alleges.
The superseding indictment alleges that from September 2013 through September 2015, the defendants perpetrated a bank fraud scheme by passing the mass mailing scam’s proceeds through fake bank accounts, primarily at a Wells Fargo branch in Glendale. According to allegations in the superseding indictment, Darbinyan opened bank accounts using false identities; Hakobyan and Darbinyan deposited the trademark holders’ payments into the Wells Fargo bank accounts and, with the assistance of Wells Fargo bank employees, transferred the funds to other accounts under Darbinyan’s control and either made cash withdrawals or purchased gold with cashier’s checks and wire transfers.
Hakobyan’s separate bank fraud charge arises from allegations that he made a fraudulent withdrawal while impersonating one of the supposed account holders.
“Using false identities, bogus business names, and virtual office centers, the defendants allegedly scammed trademark holders and turned the proceeds to cash and gold,” said Erick Martinez, Special Agent in Charge of the IRS-Criminal Investigation’s Los Angeles Field Office. “This joint investigation continues to demonstrate our efforts to ensure that our financial institutions will not be abused by those serving their own selfish greed at the expense of others.”
The charges and allegations in the superseding indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The USPIS and IRS-CI investigated the case. Trial Attorney William E. Johnston of the Criminal Division’s Fraud Section in Washington is prosecuting the case.
Former-DeKalb County Zoning Board of Appeals Member and Late-Night Business Owner Sentenced for BriberyRead the Press Release
ATLANTA – Former DeKalb County Zoning Board of Appeals Member Jeremy “Jerry” Clark and Ismail Sirdah have been sentenced to federal prison on corruption charges. Clark accepted a bribe from Sirdah in exchange for voting for a zoning variance for Sirdah’s late-night billiard hall in DeKalb County, Georgia.
“This is another unfortunate incident of corruption in DeKalb County,” said U.S Attorney John Horn. “Again, I reiterate that the citizens of DeKalb County expect public officials to act with honestly and integrity. Public officials who may be tempted by money and graft remember; we remain committed to investigating and prosecuting acts of corruption regardless of who commits them or where they are.”
“Today’s sentencing serves as a reminder to not only these defendants but other public officials that there are consequences for such actions as seen in this case. Because of the extensive potential damage involved, the FBI regards public corruption investigations as its number one criminal investigative priority and, as such, urges the public to partner with our agents in reporting those who abuse their public offices,” said J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office.
According to U.S. Attorney Horn, the charges, and other information presented in court: In November 2008, the DeKalb County (Georgia) Board of Commissioners passed a zoning ordinance that regulated the operation of late-night establishments and nightclubs. As a general matter, the ordinance required that new businesses obtain a Special Land Use Permit if they wanted to operate either as a late-night establishment or as a nightclub. The zoning ordinance provided an exception to the new rule for pre-existing late-night establishments and nightclubs, which allowed those businesses to be exempt from the 2008 zoning ordinance change.
Ismail Sirdah was the owner and Chief Executive Officer of 2841 Investments, Inc., which did business as LuLu Billiards. LuLu Billiards was a pool hall and bar located in Tucker, Georgia, which is located in DeKalb County.
Based on the new zoning ordinance, in November 2011, the DeKalb County Department of Planning and Sustainability informed LuLu Billiards in writing that it was grandfathered in only as a late-night business – and thus could neither operate as a nightclub nor have a dance floor. Despite the notice, Lulu Billiards operated as a nightclub and possessed a dance floor.
In September 2012, the Department of Planning and Sustainability issued a warning to Sirdah through LuLu Billiards for operating as a nightclub with a dance floor. In the warning, Sirdah was again advised that under the new zoning ordinance, LuLu Billiards could not operate as a nightclub or have a dance floor without a Special Land Use Permit.
Sirdah responded that LuLu Billiards had operated as a nightclub prior to the 2008 zoning ordinance – and as a result, should be grandfathered in as a nightclub under the new zoning rule.
Sirdah appealed not being able to operate LuLu Billiards as a nightclub to the DeKalb County Zoning Board of Appeals. The Zoning Board of Appeals hears and decides zoning appeals when a property owner alleges that a county official committed a zoning error. From January 2009 to May 2013, Jeremy Clark served as a member of the Zoning Board of Appeals.
Prior to the hearing on the appeal, Sirdah met with Clark. During those meetings, Sirdah made it clear to Clark, that if the Zoning Board of Appeals approved Sirdah’s petition to operate as a nightclub, Clark would be rewarded.
In November 2012, the Zoning Board of Appeals approved Sirdah’s request to operate as a nightclub. Clark voted in favor of LuLu Billiards being able to operate as a nightclub. In return for the vote, Sirdah paid Clark approximately $2000 in cash and donated approximately $1,500 to a non-profit interest with which Clark was involved.
On February 19, 2015, Clark, 43, of Lithonia, Georgia, pleaded guilty to accepting a bribe from Sirdah. He was sentenced to nine months in prison followed by three years of supervised release and order to pay a $3,500 fine.
On April 2, 2015, Sirdah, 53, of Duluth, Georgia, pleaded guilty to bribing Clark. He was sentenced to six months in prison followed by two years of supervised release and order to pay a $10,000 fine.
These cases were investigated by the Federal Bureau of Investigation.
Assistant United States Attorney Jeffrey W. Davis prosecuted the cases.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao/gan/.
Former Ziggies Owner Pleads Guilty to $1.3 Million Tax SchemeRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that the former owner of Ziggies restaurants in Springfield and elsewhere pleaded guilty in federal court today to failing to pay more than $1.3 million in federal payroll taxes.
Agim Zendeli, 43, of Springfield, waived his right to a grand jury and pleaded guilty before U.S. Magistrate Judge David P. Rush to an information that charges him with failure to pay over to the IRS the payroll taxes he collected from his employees.
Zendeli operated a chain of restaurants under the name “Ziggies” in Springfield, Republic, Willard, Marshfield, Nevada, West Plains, Rolla, Carthage and Poplar Bluff in Missouri, and in Fort Scott and Pittsburg in Kansas, from 1998 to 2014.
From March 2004 through December 2014, Zendeli opened and closed 18 companies he formed to operate as Ziggies. For each such company, Zendeli withheld federal income taxes and Social Security and Medicare taxes from his employees’ pay, and the employees believed those amounts had been paid over the IRS on their behalf. However, Zendeli admitted today, he did not pay those amounts over to the IRS as he was required to do.
From 2004 through 2014, Zendeli diverted substantial amounts of money from the restaurant LLCs he owned and operated. During this period, Zendeli lived a lavish lifestyle, and spent substantial sums on vacations, gambling trips, entertainment and luxury vehicles, including three BMWs, two Cadillac Escalades, two Infiniti QX56s, a 2009 Mercedes, a 2008 Acura and a 2004 Land Rover.
In order to avoid IRS collection of past due employment taxes, Zendeli repeatedly formed new entities to continue restaurant operations. Once each company accumulated a large tax debt to the IRS, Zendeli ceased operating under that company’s name and opened a new entity, often in the name of a family member, partner, or employee. Zendeli, however, maintained custody and control of the businesses.
The total tax loss resulting from the scheme for all entities controlled by Zendeli totals $1,330,708, which includes $741,099 in payroll taxes he deducted from his employees’ pay, plus the required employer’s contributions to Social Security, Medicare and unemployment taxes. Under the terms of today’s plea agreement, Zendeli must pay the government $1,330,708 in restitution, as well as statutory interest.
In addition, Zendeli attempted to avoid payment of approximately $654,260 in past due federal and state employment taxes by filing bankruptcy on March 26, 2010. Prior to the bankruptcy, Zendeli divorced his wife and transferred the trademarked name “Ziggies®” to his father, for a token payment. (Funds from the 2011 sale of trade name “Ziggies®” were remitted through Zendeli’s bankruptcy proceedings, after the trustee determined a fraudulent transfer of assets had occurred.)
Under federal statutes, Zendeli is subject to a sentence of up to five years in federal prison without parole, plus a fine up to $250,000. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Steven M. Mohlhenrich. It was investigated by IRS-Criminal Investigation.
Former VP Pleads Guilty to Embezzling from Houston Police Federal Credit UnionRead the Press Release
HOUSTON – A 66-year-old former ex-vice president of the Houston Police Federal Credit Union has been convicted of embezzlement that occurred for approximately 18 years, announced U.S. Attorney Kenneth Magidson.
Cheryl Vickers was charged in a criminal information filed Dec. 7, 2015. Today, she appeared before U.S. District Judge Melinda Harmon to enter a plea of guilty to one count of embezzlement. As part of her plea, she admitted that between January 1997 and February 2015 she embezzled at least $1,247,785 from the Houston Police Federal Credit Union while employed there as vice-president of accounting.
The embezzlement was ultimately discovered following her retirement in February 2015. At that time, a credit union customer brought in a “stale” check to have it re-issued. A “stale” check is an old check that has been issued by the credit union but never cashed. When credit union records showed that Vickers had already reissued the stale check, the credit union conducted an audit of Vickers’ banking activity.
The audit revealed that from January 1997 until her retirement, Vickers had embezzled at least $1,247,785 by various means, including, but not limited to, re-issuing stale checks. The credit union maintained a ledger of its stale checks which showed that Vickers reissued stale checks to credit card companies to pay her personal credit card bills. This included a Feb. 4, 2015, reissued stale check in the amount of $7,800 to pay her Chase Bank credit card bill. Some of the reissued checks even had her credit card number hand-written on them
Vickers admitted that while employed at the Houston Police Federal Credit Union, she took credit union money without authorization or permission.
She faces up to 30 years in federal prison at the time of her sentencing. She was permitted to remain on bond pending that hearing.
The charges are the result of an investigation conducted by FBI, with assistance from the Federal Deposit Insurance Corporation – Office of Inspector General. Assistant U.S. Attorney Belinda Beek is prosecuting the case.
Former USP-Canaan Inmate Sentenced to 14-Years’ Imprisonment for Stabbing Four Correctional OfficersRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Jerome Lummus, age 37, was sentenced today to 14 years’ imprisonment by Senior United States District Court Judge Edwin M. Kosik in Scranton for assaulting four correctional officers and inflicting bodily injury.
According to United States Attorney Peter Smith, on August 18, 2015, inmate Jerome Lummus, who was serving a federal prison sentence for drug trafficking, approached a correctional officer in the cafeteria at USP-Canaan and took a sharpened metal knife and stabbed the officer in the upper torso, as well as stabbed three other correctional officers who assisted in subduing Lummus. As a result of the unprovoked attack, the correctional officers all sustained stab wounds which required medical attention, but did not result in any life threatening injury.
Lummus pled guilty to the charges prior to his sentencing. Judge Kosik ordered that the 14-year imprisonment term start after Lummus completed his other sentences.
Lummus was charged in an indictment in September 2015, as a result of an investigation by the Federal Bureau of Investigation and the Bureau of Prisons. Assistant United States Attorney John Gurganus prosecuted the case.
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