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22 February 2016
Former CNMI Firefighter Sentenced to 30 Years for Sexual Exploitation of a ChildRead the Press Release
Saipan, CNMI – ALICIA A.G. LIMTIACO, United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that U.S. District Court Chief Judge Ramona V. Manglona sentenced Richard Sullivan Benavente, age 45, today, to the statutory maximum of 360 months in prison followed by three years of supervised release for sexual exploitation of a child. The Court also ordered him to pay restitution to the two minor victims.
In July 2013, the CNMI Department of Public Safety received a video file from an anonymous source depicting Benavente and a minor female engaging in sexually explicit conduct. The minor was later identified. The same video file was found on Defendant’s cell phone pursuant to a search warrant. Benavente was arrested on a complaint on August 14, 2013. On August 22, 2013, a federal grand jury returned an indictment against Benavente charging him with two counts of sexual exploitation of a child and one count of attempted sexual exploitation of a child in violation of 18 U.S.C. § 2251(a). He pleaded guilty to count one of the indictment on February 10, 2014, pursuant to a plea agreement requiring him to cooperate with the United States and provide truthful information about his criminal conduct, as well as the conduct of others. However, on October 9, 2015, the Court ruled that Benavente breached his plea agreement by committing perjury at the trial of another defendant at which Benavente testified, when he claimed to own a cell phone the prosecution argued was used by that other defendant to contact minors for purposes of prostitution.
Following the sentencing, United States Attorney for the Districts of Guam and the Northern Mariana Islands, Alicia A.G. Limtiaco, stated, “Consistent with the Department of Justice’s efforts to combat child sexual exploitation, the United States Attorney’s Office, together with its federal and local law enforcement partners, will vigorously investigate and prosecute individuals who prey on children, and strive to rid our islands of this unconscionable crime. We encourage and urge members of our community to report to authorities any and all forms of abuse, exploitation and violence; and remind ourselves, that it is all of our responsibility to protect others, especially the most vulnerable such as our children and minors, from those who perpetrate these heinous crimes.”
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. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
The case was investigated by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorneys Rami S. Badawy, Ross K. Naughton, and Garth R. Backe.
Former Bank Employee Sentenced to Prison for Misapplication of Bank FundsRead the Press Release
DES MOINES, IA – On February 16, 2016, Barbara L. Baker, 54, of Montezuma, Iowa, was sentenced by Senior United States District Court Judge Robert W. Pratt to 60 days in prison for misapplication of bank funds, announced Acting United States Attorney Kevin E. VanderSchel. Baker will also be required to serve a three year term of supervised release following her term of imprisonment.
On August 7, 2015, Baker pled guilty to a United States Attorney’s Information charging her with the misapplication. Baker admitted from around January 20, 2012, to around July 19, 2013, she misapplied funds from Patriot Bank in Brooklyn, Iowa, for her own benefit, while she served as the chief financial officer of the bank.
This matter was investigated by the Federal Deposit Corporation Office of Inspector General and the United States Secret Service. The case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
Federal Jury in El Paso Convicts Mexican Businessman in Pyramid SchemeRead the Press Release
A federal jury in El Paso convicted self-proclaimed licensed investment broker Roberto Trinidad Del Carpio Frescas of carrying out a Ponzi scheme that resulted in an estimated minimum $15 million loss announced United States Attorney Richard L. Durbin, Jr., U.S. Secret Service Special Agent in Charge Lee Dotson and El Paso Police Chief Greg Allen.
Late Friday afternoon, jurors convicted Del Carpio, age 39, of Chihuahua, MX, of 24 counts of wire fraud and ten counts of money laundering.
Evidence presented during trial revealed that the defendant held himself out to have superior knowledge and ability as an investor in stocks, bonds, futures in oil, gas, precious metals and currency. Though he was not licensed in the state of Texas as a dealer, or registered as an investment adviser, Del Carpio formed several companies in Texas including SMI International Institute Corporation (aka Stock Market Investment), Del Carpio Trading Institute LLC, and one in the Cayman Islands, Del Carpio Holdings, to facilitate his scheme.
From August 2010 until January 2012, Del Carpio conspired with others to collect money from over 100 known investors in Mexico and the United States. Del Carpio pocketed most all of the funds he collected though he did pay minimal amounts of money to “early” investors as a return on their investment and to encourage his victims to invest more of their money with him.
Del Carpio faces up to 20 years in federal prison for wire fraud and up to ten years in federal prison for money laundering.
Del Carpio has remained in federal custody since his arrest in February 2015. Sentencing is expected to occur within the next 60 days before United States District Judge David C. Guaderrama in El Paso.
Del Carpio’s co-defendant, 60-year-old David Brian Binder of Pittsburg, PA, is charged by indictment with one count of accessory after the fact and one count of wire fraud. Binder, who is currently out on bond, is scheduled for jury selection and trial on April 18, 2016, before Judge Guaderrama in El Paso. Upon conviction, Binder faces up to 20 years in federal prison for wire fraud and up to ten years in federal prison for accessory after the fact.
It is important to note that an indictment is merely a charge and should not be considered as evidence of guilt. Binder is presumed innocent until proven guilty in a court of law.
If you feel you may have been victimized as a result of the above mentioned scheme, please contact the U.S. Secret Service at (915) 532-2144 or the El Paso Police Department.
This investigation was conducted by agents with the U.S. Secret Service and the El Paso Police Department. Assistant United States Attorneys Ian Hanna and Stanley Serwatka are prosecuting this case on behalf of the Government.
Euclid man charged in federal court after arrest with more than 900 pills of fentanylRead the Press Release
A Euclid man was charged in federal court with conspiracy to distribute fentanyl and crack cocaine after he was arrested with more than 900 pills of fentanyl, law enforcement officials said.
Ryan Gaston, 29, was arrested on Feb. 3. A search of his car and home apartment revealed rocks of crack cocaine, a 9 mm High Point rifle and approximately 926 round blue pills believed to be Oxycodone 30 mg pills. A subsequent test revealed the pills were not Oxycodone, but instead fentanyl, according to the criminal complaint.
Fentanyl is a very potent synthetic opiate used to treat pain and as a surgical anesthetic. While heroin is approximately three times as potent as morphine, fentanyl is approximately 80-100 times more powerful than morphine. There were 37 fentanyl-related deaths in Cuyahoga County In 2014. Last year, there were 89 and this year, there have already been at least 19, according to the complaint.
“Each one of these pills is capable of killing a person,” said Acting U.S. Attorney Carole Rendon. “We will continue to attack the opioid problem from all sides – prevention, education, treatment and enforcement. This defendant will be held accountable for spreading poison throughout our community.”
This case is being prosecuted by Assistant U.S. Attorney Michelle Baeppler following an investigation by the Drug Enforcement Administration, the Cleveland Heights Police Department, the Cuyahoga County Sheriff’s Office and the Euclid Police Department.
Enfield Restaurant Owner Pleads Guilty to Tax EvasionRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that GEORGE CARABASE, 41, of Enfield, waived his right to indictment and pleaded guilty today before U.S. District Judge Jeffrey A. Meyer in New Haven to two counts of tax evasion.
According to court documents and statements made in court, in 2010 and 2011 CARABASE failed to report to the Internal Revenue Service approximately $550,000 in gross receipts generated by Buona Vita Restaurant, a restaurant he operates in Enfield.
During the investigation of this matter, CARABASE admitted to an undercover IRS agent that he understated the restaurant’s gross receipts on his income tax returns and provided false numbers to his accountant.
In pleading guilty, CARABASE admitted that he evaded payment of a total of $183,282 in income taxes when filing his income tax returns for 2010 and 2011.
Judge Meyer scheduled sentencing for May 20, 2016, at which time CARABASE faces a maximum term of imprisonment of five years and a fine of up to $100,000 for each count. As part of his guilty plea, CARABASE has agreed to pay $208,132 in back taxes and interest, as well as applicable penalties.
This case was investigated by the Internal Revenue Service – Criminal Investigation Division and is being prosecuted by Assistant U.S. Attorney Heather Cherry.
District Men Sentenced to 13 Years in Prison for Robbing and Carjacking Three VictimsRead the Press Release
WASHINGTON – Marquell Derrington, 20, and Mark Penamon, 28, both of Washington, D.C., have each been sentenced to 13 years in prison on charges stemming from an armed robbery and armed carjacking in Northeast Washington, U.S. Attorney Channing D. Phillips announced today.
Derrington and Penamon pled guilty in November 2015, in the Superior Court of the District of Columbia, to carjacking, two counts of armed robbery, and related firearms offenses. They were sentenced on Feb. 19, 2016 by the Honorable Anita Josey-Herring. Upon completion of their prison terms, the defendants will be placed on five years of supervised release.
Derrington and Penamon admitted that, on Oct. 2, 2014, at about 6:50 a.m., they arrived at Derrington’s house via an alley off of the 900 block of I Street NE. At the mouth of the alley, two of the victims, who are home improvement contractors, were working to set up for a project at a home adjacent to the alley. As the defendants drove into the alley, they saw the victims in the backyard of the project site, and decided to rob them. The defendants approached the victims on foot, drew firearms – Derrington’s was a semi-automatic pistol with a lazer mounted on the barrel – and forced the victims to the ground. The third victim, a colleague of the first two, arrived shortly thereafter, and Derrington pistol-whipped him and commanded him and the other two to face the back wall of the house. Derrington and Penamon proceeded to hold the victims at gunpoint and rob them of their personal property. Penamon robbed one of the victim of his truck keys, and, while Derrington held all three victims at gunpoint, Penamon got the truck and drove it immediately next to the robbery location. Penamon went back to join Derrington in completing the robberies, and then both defendants fled in the victim’s vehicle.
In announcing the sentence, U.S. Attorney Phillips commended the work of those who investigated the case for the Metropolitan Police Department (MPD). He also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including former Paralegal Specialist Todd McClelland and Assistant U.S. Attorneys Nihar Mohanty, Kacie Weston, and former Assistant U.S. Attorney David Rubenstein. Finally, he thanked Assistant U.S. Attorneys John Marston and Laura Crane, of the Felony Major Crimes Trial Section, who prosecuted the matter.
Convicted Sex Offender Sentenced to over 21 Years in Prison for Enticing a Minor to Engage in Sexual Activity and for Receiving Child PornographyRead the Press Release
Baltimore, Maryland – U.S. District Judge James K. Bredar sentenced Michael L. Montague, age 66, formerly of Gwynn Oak, Maryland, Friday, February 19, 2016 to 262 months in prison followed by a lifetime of supervised release for using a mobile phone to entice a minor to engage in sexual activity and for receipt of child pornography. Judge Bredar also ordered that upon his release from prison, Montague will be required to continue to register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation, Baltimore Field Division; Special Agent in Charge Andre R. Watson of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Colonel William M. Pallozzi, Superintendent of the Maryland State Police; Chief James W. Johnson of the Baltimore County Police Department; and Baltimore County State’s Attorney Scott Shellenberger.
According to Montague’s plea agreement, from February 16 through March 26, 2014, Montague used his mobile phone to contact the victim. Montague knew the victim, and knew that he was 12 years old at the time of their communications. Montague used a mobile application to contact the victim using a number different from the telephone number assigned to Montague’s phone. Using this disguised phone number Montague contacted the victim and claimed to be “Gail,” a classmate of victim’s. Posing as “Gail,” Montague engaged in sexually explicit text and email communications with the victim.
Montague, posing as “Gail” wrote to the victim that she knew Montague, and that the victim should send pictures of himself to Montague, and Montague would send the victim pictures of “Gail.” “Gail” told the victim that Montague had very nice pictures of “Gail” that the victim should ask to see. “Gail” suggested that the victim seek permission to stay with Montague for a weekend so that “Gail” and the victim could meet for a sexual encounter. “Gail” also told the victim that she could get Montague to make a sexual video of her, and that then the victim should let Montague make a sexual video with him. Montague also sent messages to the victim posing as a male classmate of the victim who also knew Montague and “Gail.”
Forensic examination of Montague’s phone revealed sexually explicit communications with the victim, sexually explicit images and videos Montague sent to the victim, and a sexually explicit image that the victim sent to Montague.
On May 19, 2009, Montague was convicted in the Circuit Court for Baltimore County, Maryland, of child abuse and a third degree sex offense, for his sexual abuse of two girls, and was sentenced to three years in prison.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc. For more information about internet safety education, please visit www.justice.gov/psc and click on the "resources" tab on the left of the page.
United States Attorney Rod J. Rosenstein commended the FBI, HSI Baltimore, Maryland State Police Internet Crimes Against Children Task Force, Baltimore County Police Department and Baltimore County State’s Attorney’s Office for their work in the investigation and prosecution. Mr. Rosenstein thanked Assistant U.S. Attorneys Zachary A. Myers and Judson T. Mihok, who prosecuted the case.
Convenience Store Owner Sentenced to Federal Prison for Trafficking in Food StampsRead the Press Release
ATLANTA - Tessema Lulseged has been sentenced to serve four years and three months in federal prison for using his Decatur, Georgia, convenience store to illegally traffic in food stamps. Lulseged allowed his customers to exchange their food stamp benefits for cash in a scheme that netted him $6.5 million.
“The purpose of the food stamp program is to offer low-income citizens nutritional assistance, and this defendant undermined the program solely for his own profit and cost taxpayers more than $6.5 million,” said U.S. Attorney John Horn.
The United States Department of Agriculture, Office of Inspector General- Investigations, actively investigates allegations of fraud in the Supplemental Nutritional Assistance Program (SNAP). Annually, this type of fraudulent activity undermines this program by misdirecting millions of dollars of taxpayer funds from the purposes they were intended. We would like to thank U.S Attorney's Office for aggressively prosecuting perpetrators of fraud and sending a strong message that illegally profiting by defrauding USDA programs will not be tolerated,” said Karen Citizen-Wilcox, Special Agent-in-Charge for USDA’s Office of Inspector General.
“This case represents an individual systematically exploiting those in need and diverting U.S. funds intended for the needy to his own bank account. The FBI is pleased with its role in bringing this case forward for prosecution which resulted in today’s federal prison sentence for Mr. Lulseged,” 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: From January 2009 through April 2014, Lulseged operated Tess Market, Inc., d/b/a Big T Supermarket, a convenience store in Decatur, Georgia, where he unlawfully allowed his customers to exchange their food stamp benefits for cash at the rate of 60 cents on the dollar. As part of the deal, Lulseged required customers to purchase eligible food products equal to 10% of the value of the transaction. For example, if a customer wanted to sell $100 worth of food stamp benefits for $60, that customer also had to purchase $10 worth of eligible food products from Lulseged’s store. The fraudulent scheme netted Lulseged approximately $6.5 million.
Pursuant to search and seizure warrants that were executed in February 2014, the government seized and forfeited over $700,000 in funds tainted by the fraud. The government also forfeited two pieces of real property: the defendant’s personal residence in Gray, Georgia, and his store property in Decatur, Georgia, on the grounds that they were proceeds of the fraud and properties involved in money laundering transactions.
Tessema Lulseged, 49, of Decatur, Georgia, was sentenced to four years, three months in prison, to be followed by three years of supervised release, and ordered to pay restitution in the amount of $5,930,450.16. Lulseged was convicted on these charges on July 7, 2015, after he pleaded guilty.
This case was investigated by the U.S. Department of Agriculture, Office of Inspector General, Investigations Division, and the Federal Bureau of Investigation.
Assistant U.S. Attorneys J. Russell Phillips, Dahil D. Goss, and Jenny R. Turner prosecuted the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Cochiti Pueblo Man Pleads Guilty to Federal Bank Robbery ChargesRead the Press Release
ALBUQUERQUE – Marcelino Chalan, 27, of Cochiti Pueblo, N.M., pleaded guilty today in federal court in Albuquerque, N.M., to bank robbery charges.
Chalan was arrested Sept. 16, 2015, on a criminal complaint charging him with robbing the Wells Fargo Bank branch inside the Albertson’s supermarket located at 3301 Southern Blvd. in Rio Rancho, N.M., on July 20, 2015. The complaint alleged that Chalan robbed the bank by handing a handwritten note with a robbery demand to a bank teller. The teller complied with Chalan’s written and verbal robbery demands and handed money over to Chalan. Chalan left the scene in a vehicle that appeared to be driven another individual. The investigation into Chalan began after the FBI received a tip identifying Chalan as the bank robber.
Chalan was subsequently indicted on Oct. 7, 2015, and charged with robbing the Wells Fargo Bank located at 3301 Southern Blvd. in Rio Rancho on July 20, 2015; robbing the First National Rio Grande Bank located at 7620 Jefferson St. in Albuquerque on July 27, 2015; and robbing the Santa Fe Federal Credit Union located at 7101 Jefferson St. in Albuquerque on Aug. 3, 2015.
During today’s plea hearing, Chalan entered a guilty plea to the indictment without the benefit of a plea agreement. At sentencing, Chalan faces a maximum penalty of 20 years in federal prison. He remains in custody pending a sentencing hearing which has yet to be scheduled.
This case was investigated by the Albuquerque office of the FBI, the Rio Rancho Police Department, the Albuquerque Police Department and the Cochiti Pueblo Tribal Police Department. Assistant U.S. Attorney Kimberly A. Brawley is prosecuting the case.
Central Valley Antidrug Trafficking Program Recognizes District ProsecutorRead the Press Release
SACRAMENTO, Calif. — On Thursday, February 18, 2016, Assistant U.S. Attorney Karen A. Escobar received the High Intensity Drug Trafficking Area’s national Outstanding Prosecutor Award today for her leadership in the prosecution of rural trespass marijuana growers for their environmental crimes, exposing violators to criminal and civil penalties, and for bringing public attention to the environmental destruction caused by large-scale marijuana growers, United States Attorney Benjamin B. Wagner announced.
The annual HIDTA Awards Banquet, which was held in the Wardman Park Marriott in Washington D.C., recognizes outstanding investigative achievements across the country. The Outstanding Prosecutor Award is presented to the prosecutor whose work is particularly notable in advancing the mission of the HIDTA program.
The HIDTA program, created by Congress with the Anti-Drug Abuse Act of 1988, 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. There are currently 28 HIDTA’s, which include approximately 17.2 percent of all counties in the United States and a little over 60 percent of the U.S. population. HIDTA-designated counties are located in 48 states, as well as in Puerto Rico, the U.S. Virgin Islands, and the District of Columbia. The Central Valley HIDTA covers 12 counties in the Eastern District of California, and funds several federal/state/local task forces in the region.
William Ruzzamenti, Executive Director of the Central Valley California HIDTA stated: “The National Prosecutor of the Year is a very significant and prestigious award. It recognizes that Ms. Escobar is not only one of this country's most outstanding prosecutors, but also as a special person within her community. Ms. Escobar blends a tremendous legal intellect with old fashion common sense in an extraordinary way to assure criminals are held accountable.”
U.S. Attorney Wagner echoed those sentiments, saying, “Karen Escobar has long been one of the most productive federal narcotics prosecutors in this district. She has been a particular leader in combatting the environmental devastation caused by marijuana cultivators in National Forests and National Parks. I am very pleased that her work is now being recognized on a national level. This award is well-deserved.”
Karen Escobar has been an Assistant U.S. Attorney in Fresno for more than 26 years, specializing in the prosecution of drug trafficking organizations plaguing California’s Central Valley. She has prosecuted more than 2,000 federal cases with a conviction rate of 99 percent. She pioneered the pursuit of environmental crime charges against illegal marijuana growers whose toxic cultivation practices endanger wildlife, the environment, and public health; holding them responsible for their actions and bringing much-needed public attention to the issue. She contributed to the development of national sentencing guidelines for environmental harm caused by illegal marijuana grows.
Central Florida Drug Importer Sentenced to Ten YearsRead the Press Release
Orlando, Florida – United States District Judge Gregory A. Presnell today sentenced Thiago Correa (22, Windermere) to 10 years in federal prison for drug importation, conspiracy, and trafficking violations, and for using a firearm in furtherance of his drug trafficking activities.
Correa is the fourth individual to be sentenced in Orlando for drug trafficking and related charges concerning the importation and distribution of methylone and ethylone, also called “Molly” or “Mol,” from China into Brevard and Orange Counties. These prosecutions are part “Project Synergy,” an international investigation headed by the Department of Justice’s Special Operations Division.
According to court documents, from approximately January 2014, through their arrests on March 18, 2015, Thiago Correa, Camila Correa (25, Windermere), Travis Simmons (25, Deland), and others conspired to import no less than 25 kilograms of ethylone and methylone from China into Orlando, Melbourne, Titusville, and Windermere. Thiago Correa was a leader and organizer in the conspiracy: he ordered the drugs from China; paid for and directed others to pay for the drugs; coordinated shipments; and recruited and directed others to distribute the drugs. During this conspiracy, Correa used a variety of firearms, including handguns and an assault rifle.
“HSI special agents and our law enforcement partners will continue to work together toward keeping dangerous and deadly substances from harming our citizens,” said Susan L. McCormick special agent in charge of HSI Tampa. “Our communities are safer today because we dismantled this drug trafficking organization.”
Camila Correa and Travis Simmons previously pleaded guilty for their roles in this case. On September 8, 2015, Simmons was sentenced to seven years in federal prison. Correa’s sentencing hearing is scheduled for March 14, 2016.
This case was investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations and the Brevard County Sheriff’s Office. It is being prosecuted by Assistant United States Attorney J. Bishop Ravenel.
Atlanta Executives and an Internet-Based Promoter Charged with Scheme to Defraud InvestorsRead the Press Release
ATLANTA – The co-owners, chief operating officer, and an alleged paid promoter of Sterling Currency Group, which at one time billed itself as one of the largest sellers and exchangers of the Iraqi dinar in the U.S., have been indicted for their roles in a scheme to fraudulently induce investors into purchasing the Iraqi dinar. Tyson Rhame, James Shaw, Terrence Keller, and Frank Bell, have been indicted in this case and had their initial appearances before U.S. Magistrate Judge Alan J. Baverman.
“Investors in the Iraqi dinar, like all investors, are entitled to make an informed choice based on honest and transparent information,” said U. S. Attorney John Horn. “These defendants are alleged to have defrauded investors by spreading misinformation about the investment potential of the Iraqi dinar in order to profit from sale of the currency. We urge anyone who believes they were impacted by this scheme to contact the FBI.”
“This federal indictment represents extensive efforts by the government to protect investors from those who would make alleged unsubstantiated claims involving the potential revaluation of certain foreign currency. The FBI, along with the IRS Criminal Investigative Division, has made every effort to provide some protection for those who have already invested by seizing millions of dollars, the disposition of which will be further determined as this case now moves into the U.S. Courts system,” said J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office.
“Investment fraud schemes are designed to appeal to people's hope, often resulting in the total loss of their investment,” stated Special Agent in Charge Veronica F. Hyman-Pillot, IRS Criminal Investigation. “Individuals who line their pockets with money gained through deceiving others should know they will not go undetected and will be held accountable. The indictment of these individuals illustrates our commitment, along with our law enforcement partners, to pursue those individuals who victimize investors, violate the public trust and enrich themselves financially at the expense of the investor.”
According to U.S Attorney Horn, the indictment, and other information presented in court: During the scope of the conspiracy, the Iraqi dinar – which is the currency of the country of Iraq - was touted by some as a potential investment opportunity. Information publicly available on certain internet websites, blogs, chat rooms, and conference calls fueled this speculation by predicting that a “revaluation” of the Iraqi dinar would occur imminently. A “revaluation” or “RV,” in this context, meant a sudden, exponential rise in the value of the Iraqi dinar as compared to the U.S. dollar and other relatively stable global currencies. Individuals who owned Iraqi dinar would realize potentially enormous gains if an “RV” ever occurred in this manner.
Sterling Currency Group, LLC, which also did business as Sterling Online Processing Services, LLC, and Dinar Banker (collectively, “Sterling”), was a Georgia corporation with its principal place of business in Atlanta, Georgia. Sterling sold and exchanged so-called “exotic currencies,” including most predominantly the Iraqi dinar.Tyson Rhame and James Shaw were co-owners of Sterling, which began operations in 2004. Frank Bell began working for Sterling in 2010 and became Sterling’s Chief Operating Officer in 2011.
According to the indictment, Terrence Keller, who was also known as “TerryK,” led an internet-based group known as “The GET Team,” which consisted of a website, an internet chat forum and weekly conference calls in which, among other things, information was disseminated to participants concerning the potential investment value of the Iraqi dinar.Keller, through The GET Team, was one of the leading internet-based proponents of the “RV” theory. On The GET Team’s website, internet chat forum, and on weekly conference calls, Keller is alleged to have falsely claimed to have information from, and verified by, high-level confidential sources in the United States government, the Iraqi government, international organizations, and major financial institutions, regarding an imminent “RV.” However, Keller did not have information from, or contact with, these supposed high-level confidential sources. The indictment alleges that Keller, Rhame, Shaw, and Bell knew and believed that representations concerning an imminent “RV” of the Iraqi dinar, particularly claims that the information came from one or more supposed high-level confidential sources, would boost sales for Sterling.
Keller allegedly claimed, directly and indirectly, to The GET Team followers that he had no financial or other ulterior motive to promote the Iraqi dinar as an investment, but, rather, that he was simply disseminating his knowledge and information so that others could benefit from it as well. To that end, Keller affirmatively told his followers that he did not make substantial profits from his dealings with Sterling and other dinar dealers that advertised with the GET Team.Keller allegedly had a secret arrangement with Rhame, Shaw and Bell to promote and “pump” the Iraqi dinar in exchange for payments made by Sterling to benefit Keller. Since at least as early as August 2011, Sterling paid Keller over $160,000. Keller consistently downplayed these financial benefits to his followers and listeners.
The correlation between Sterling’s increased sales and Keller’s promotion of the Iraqi dinar was allegedly further cemented by the presence of a Sterling representative, including, at times, Rhame and Bell, on The GET Team’s conference calls and internet forums. At various times, Rhame, Bell and other Sterling representatives participated in conference calls and internet forums in which Keller made representations to followers concerning the imminent Iraqi dinar “RV,” his access to high-level confidential sources, and claims that he was just trying to be helpful and received no financial benefit for providing this information to others. The presence and participation of Rhame, Bell, and other Sterling representatives on The GET Team’s conference calls and internet forums provided further validation to followers that Keller’s claims about an imminent “RV” of the Iraqi dinar should be believed.
The indictment alleges that the promotional activities of Keller and other dinar promoters were essential to Sterling’s financial success and generated Sterling millions of dollars in dinar and other currency sales. In December 2010, Rhame is alleged to have told colleagues that Keller and the GET Team pushed 80% of Sterling’s business. In December 2011, Bell is alleged to have referred to the GET Team as Sterling’s “largest referrer.” Between approximately 2010 and June 2015, Sterling grossed over $600 million in revenue from the sale of the Iraqi dinar and other currencies. During this same time period, Rhame and Shaw received over $180 million in distributions from Sterling.
Tyson Rhame, 51, and James Shaw, 53, both of Atlanta, Georgia, Frank Bell, 54, of Decatur, Georgia, and Terrence Keller, also known as “TerryK,” 55, of Grayson, Kentucky, are each charged with conspiracy to commit mail and wire fraud as well as several counts of mail fraud and wire fraud. Rhame and Shaw are also charged with conspiracy to commit money laundering and 12 counts of money laundering.
The indictment also includes criminal forfeiture listing numerous assets to which the defendants may have an interest. Specifically, the government is seeking the forfeiture of millions of dollars held in financial accounts, foreign currencies, three private airplanes, three automobiles, numerous corporate and trust entities, as well as real property in Georgia, Florida, North Carolina, and Iowa. Also, the government filed motions to amend two civil forfeiture complaints, which similarly seek the forfeiture of a variety of assets allegedly linked to this scheme. The government’s motions and amended civil forfeiture complaints can be found at United States v. 225 Valley Road, NW, Atlanta, GA et. al., 1:15-CV-2032-LMM (Doc. 217) and United States v. Approximately 8,671,456,050 in Iraqi Dinars, et. al., 1:15-CV-2677-LMM (Doc. 212).
Members of the public are reminded that the indictment only contains charges. The defendants are presumed innocent of the charges and it will be the government’s burden to prove the defendants’ guilt beyond a reasonable doubt at trial.
This case is being investigated by the Federal Bureau of Investigation and Internal Revenue Service Criminal Investigation.
Assistant United States Attorneys Thomas J. Krepp, Steven D. Grimberg, and Jamie L. Mickelson are prosecuting the case. Assistant United States Attorneys Kelly K. Connors, Dahil D. Goss, and Thomas J. Krepp are handling the parallel civil forfeiture actions.
Members of the public who believe they were impacted by this scheme are encouraged to contact the FBI at https://forms.fbi.gov/iraqi-dinar-investment-investigation.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Arkansas Man Sentenced for Armed Robberies of Bank, 11 Other Businesses in Five StatesRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Bella Vista, Ark., man was sentenced in federal court today for a series of a dozen armed robberies at a Missouri bank and 11 other businesses in a five-state crime spree during the summer of 2013.
Timothy Patrick Hoyt, 45, of Bella Vista, was sentenced by U.S. District Judge Brian C. Wimes to eight years and one month in federal prison without parole.
On Sept. 9, 2015, Hoyt pleaded guilty to the charges contained in a federal indictment in the Western District of Missouri, as well as the charges contained in four separate cases in four different federal districts in Kansas, South Dakota, Nebraska and Oklahoma, all of which have been transferred to the Western District of Missouri.
Hoyt admitted that he used what appeared to be a handgun (but which later was identified as a .177-caliber pellet or BB gun that Hoyt shoplifted from a Walmart store near Blackwater, Mo.) to rob a bank in Missouri and 10 other businesses, including eight fast food restaurants, across five states between June 26 and Aug. 6, 2013.
Hoyt pleaded guilty to all four counts of the indictment filed in the Western District of Missouri. Hoyt stole $5,123 from Alliant Bank, 118 Main St., Blackwater, on June 26, 2013, with what appeared to be a handgun. Hoyt also used what appeared to be a handgun to rob the Subway restaurant at 330 N. Massey Blvd., Nixa, Mo., on July 12, 2013; the Subway restaurant at 1820 W. 32nd St., Joplin, Mo., on July 14, 2013; and the Sally Beauty Supply Store at 2007-C W. Foxwood Dr., Raymore, Mo., on Aug. 6, 2013.
Hoyt also pleaded guilty to using what appeared to be a handgun to rob the Subway restaurant at 715 N. G Street, Wellington, Kan., on July 17, 2013; the Domino’s Pizza Restaurant at 1108 S. Minnesota Ave., Sioux Falls, S. D., on July 19, 2013; the Subway restaurant at 1116 E. 10th St., Sioux Falls on July 20, 2013; the Godfather’s Pizza restaurant at 15234 W. Maple Rd., Omaha, Neb., on July 23, 2013; and the Arby’s restaurant at 6919 S. Lewis Ave., Tulsa, Okla., on July 27, 2013.
In addition to those robberies with which Hoyt has been charged, he also admitted that he used what appeared to be a handgun to rob the Papa Murphy’s Pizza restaurant at 302 W. 28th St., Sioux City, Iowa, on July 21, 2013; the Payless ShoeSource store at 7714 State Ave., Kansas City, Kan., on July 26, 2013; and the Papa Murphy’s Pizza restaurant at 3418 8th St. S.W., Altoona, Iowa, on Aug. 7, 2013.
Hoyt was arrested after robbing the Papa Murphy’s Pizza restaurant in Altoona.
This case was prosecuted by Assistant U.S. Attorney Lawrence E. Miller. It was investigated by FBI; the Cooper County, Mo., Sheriff’s Department; the Altoona, Iowa, Police Department; the Nixa, Mo., Police Department; the Joplin, Mo., Police Department; the Raymore, Mo., Police Department; the Wellington, Kan., Police Department; the Sioux Falls, S.D., Police Department; the Sioux City, Iowa, Police Department; the Omaha, Neb., Police Department; the Kansas City, Kan., Police Department; and the Tulsa, Okla., Police Department.
Alton Man Sentenced to Three Years in Prison for Bank FraudRead the Press Release
James L. Porter, Acting United States Attorney for the Southern District of Illinois, announced that this morning, United States District Judge David R. Herndon sentenced Christopher William Kreider, 29, of Alton, IL, to 37 months in federal prison on his conviction for bank fraud and submitting false loan applications to a financial institution.
Kreider pled guilty to the charges in this case on December 17, 2014. In pleading guilty, Kreider admitted that from March 4, 2010, through May 31, 2011, he defrauded the Alton Bell Community Credit Union by causing false loan applications to be submitted. Kreider engaged in a practice known as "straw borrowing." Kreider owned a landscaping business in Alton known as Lawnscape Lawn and Excavation. In an effort to keep this failing business afloat, Kreider solicited friends and employees to apply for loans, in their names, with Alton Bell Community Credit Union. The proceeds of these loans were either turned over to Kreider or applied for his benefit.
During the sentencing hearing today, Judge Herndon found that Kreider’s crimes caused a loss of $158,286.59 to Alton Bell Community Credit Union. In addition to the 37 month prison sentence, the Court also ordered Kreider to pay restitution of $207,116.06. This figure includes the loss amount and the audit feeds incurred by the credit union as it investigated the damage caused by Kreider’s crimes. In addition, the Court ordered Kreider to serve a period of 5 years of supervised release after he is released from prison.
The case was investigated by the Springfield, Illinois, Division of the Federal Bureau of Investigation. The prosecution was handled by Assistant United States Attorney Scott Verseman.
76-Year-Old Navajo Nation Man Sentenced to 10 Years in Prison for Sexual Abuse of a MinorRead the Press Release
PHOENIX– Today, Rex Damon Begay, Sr., 76, of Ganado, Ariz., a member of the Navajo Nation, was sentenced by Senior U.S. District Judge Paul G. Rosenblatt to 10 years in prison followed by a lifetime term of supervised release. Begay had previously pleaded guilty to abusive sexual contact with a minor less than 12-years-old. Begay will also have to register as a sex offender.
This case was brought to the attention of law enforcement after Arizona Child Protective Services alerted their counterparts on the Navajo Nation that a teenage Navajo girl had reported being sexually abused, several times, by Begay. Through a collaborative effort across multiple jurisdictions, investigation revealed that Begay had sexually mistreated several other female Navajo young members spanning many decades.
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, 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.
The investigation in this case was conducted by the Navajo Nation Department of Public Safety and the Federal Bureau of Investigation. The prosecution was handled by Rachel Reames Stoddard, Assistant U.S. Attorney, District of Arizona, Phoenix.
CASE NUMBER: CR-15-8137-PCT-PGR (BSB)
RELEASE NUMBER: 2016-015_Begay
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For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.
19 February 2016
“Operation Denial” to Receive National Award for ‘Outstanding Cooperative Effort’Read the Press Release
FARGO - U. S. Attorney Christopher C. Myers announced on Feb. 19, 2016, that the "High Intensity Drug Trafficking Areas" (HIDTA) Program honored 20 individuals for their cooperative efforts in "Operation Denial," which was the Grand Forks County Drug Task Force’s investigation into the international trafficking of fentanyl and other lethal drugs. This effort was significantly aided by a multi-agency approach, which led to receiving the Outstanding Cooperative Effort award.
Established in 1990 after the Anti-Drug Abuse Act of 1988 was passed, the High Intensity Drug Trafficking Area Program (HIDTA) is a drug-prohibition enforcement program run by the United States Office of National Drug Control Policy. The mission of the program is to enhance and coordinate America’s drug-control efforts among local, state, and federal law enforcement agencies in order to eliminate or reduce drug trafficking and its harmful consequences in critical regions of the United States. The term "HIDTA" also refers to each geographic location, usually a major city, county, or border crossing, in which the program has established a headquarters which are placed in locations considered to be major drug trafficking zones; to date, 28 HIDTAs have been designated since the program began. Each HIDTA is governed by a HIDTA Executive Board which includes representatives from local, state, and federal law enforcement agencies in the area of each HIDTA. By law, each HIDTA Board is equally divided between federal law enforcement on the one side and state and local agencies on the other. The Grand Forks Narcotics Task Force is a HIDTA-funded task force.
U.S. Attorney Myers stated: "This is the first time law enforcement in North Dakota has been recognized with a National HIDTA Award. The teamwork in this international investigation was extraordinary and undoubtedly saved lives. "
Attorney General Wayne Stenehjem said: "This award underscores the exceptional work these law enforcement officers and professionals provide each and every day. They have each gone above and beyond the call of duty to keep North Dakota safe, and I couldn't be prouder of the results they achieved."
Grand Forks County State’s Attorney David Jones remarked: "It is an honor to be included in this recognition which really speaks to the professional bonds between our agencies. Our law enforcement officers and legal staff work tirelessly to make our communities safer, with our agents and officers, in particular, providing selfless service on behalf of the public. No one does this for recognition, but I can think of no higher accolade than this award for Outstanding Cooperative Effort."
The following individuals are being honored by the HIDTA program and will receive the Outstanding Cooperative Effort Award for their hard work on Operation Denial:
• Special Agent Steve Gilpin, North Dakota Bureau of Criminal Investigation
• Special Agent Scott Kraft, North Dakota Bureau of Criminal Investigation
• Special Agent Michael Ness, North Dakota Bureau of Criminal Investigation
• Special Agent Jeremy Grube, Homeland Security Investigations
• Detective Daniel Casetta, Grand Forks Police Department
• Investigator Joel Lloyd, Grand Forks County Sheriff’s Office
• Investigator Delicia Glaze, Grand Forks County Sheriff’s Office
• Detective Darin Johnson, Grand Forks Police Department
• Sergeant Devan Greuel, University of North Dakota Police Department
• Investigator Andreas Alt, WCSO/Grand Forks Police Department/ Grand Forks Narcotics Task Force
• Sergeant Derek Madsen, Pembina County Sheriff’s Office
• Christopher Steenerson, Border Patrol
• Intelligence Analyst Lisa Gemar, North Dakota Bureau of Investigation
• Intelligence Analyst Ross Brumley, North Dakota Counter Drug
• Sergeant Travis Jacobson, Grand Forks Police Department
• United States Attorney Chris Myers, District of North Dakota
• Assistant United States Attorney Scott Schneider, District of North Dakota
• Assistant United States Attorney Scott Kerin, District of Oregon
• Grand Forks County State’s Attorney David Jones
• Grand Forks County Assistant State’s Attorney Carmell Mattison
The following defendants, who are each from Grand Forks, have been sentenced in this case:
Ryan Jon Jensen - 240 months (20 years)
Joshua Tyler Fulp – 144 months (12 years)
Kain Daniel Schwandt – 42 months (3 ½ years)
David Todd Noye Jr. – 39 months (3 years 3 months)
Jameson Robert Sele – 36 months (3 years)
Brandon Corde Hubbard of Portland, Oregon, is scheduled for a change of plea hearing in federal court in Fargo on March 14, 2016.
Ronnie Lee Helms of Acworth, Georgia, and Braden James Foley of Olympia, Washington, have been indicted in this case and are currently scheduled for trial May 3, 2016, in Fargo.
Daniel Vivas Ceron was arrested in Panama City, Panama, on July 17, 2015, and is currently awaiting extradition from Panama.
An Indictment is merely and accusation and defendants are presumed innocent unless proven guilty.
Wilkes-Barre Resident Pleads Guilty to Federal Charge of Failing to Comply with Sex Offender Registration RequirementsRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced that a Wilkes-Barre resident pleaded guilty yesterday in Scranton, before United States District Judge James M. Munley, to failing to comply with sex offender registration requirements.
According to United States Attorney Peter Smith, Joseph Brant, age 56, pleaded guilty to being a person required to comply with the Sex Offender Registration and Notification Act by reason of a sexual abuse conviction under the laws of the State of New York, but who failed to do so upon establishing a residence in Pennsylvania.
Brant was indicted by a federal grand jury in July 2015. The government filed a plea agreement in the case. The indictment charged that Brant established a residence in Wilkes-Barre, but failed to register or update his sex offender registration information in Pennsylvania as required by the law.
The charges are the result of an investigation by the Scranton and New York offices of the United States Marshals Service. The case is being prosecuted by Assistant United States Attorney Michelle Olshefski.
The maximum possible penalties for the violation include 10 years’ incarceration, 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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Wasilla woman indicted for Federal Grant FraudRead the Press Release
Anchorage, Alaska – Acting U.S. Attorney Kevin R. Feldis announced today that a Wasilla woman was indicted by a federal grand jury in Anchorage for presenting false claims for federal grant funds to the United States Department of Agriculture.
Crystal Jean Boze, aka “Crystal Jean Hazlitt,” 33, of Wasilla, Alaska, is the sole defendant named in the one-count indictment.
According to the indictment, Boze illegally presented three false claims for federal grant funds to two agencies of the United States Department of Agriculture (USDA). Boze’s company, Green Winter Farms LLC (a farming company located in Palmer, Alaska), was awarded a $72,103 grant by the USDA Natural Resources Conservation Service in 2012, and a $49,689 grant by USDA Rural Development in 2013. Among other things, the grants required Boze’s company to seek payment of USDA grant funds on a reimbursement basis only and to certify that each claim for reimbursement was accurate.
The indictment charges that three times between Feb. 1, 2013, and June 9, 2013, Boze, acting on behalf of her company, knowingly made and presented false and fraudulent claims to USDA seeking payment of USDA grant funds. Boze also knowingly presented false and fraudulent purchase invoices supporting documentation for each claim.
Assistant U.S. Attorney Andrea Hattan, who presented the case to the grand jury, indicated that the law provides for a maximum total sentence of five years in prison, a fine of $250,000, or both, for the charged offense. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
The Federal Bureau of Investigation (FBI) and the United States Department of Agriculture Office of the Inspector General (USDA OIG) conducted the investigation leading to the indictment in this case.
An indictment is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
Violent Carjacker Sentenced to 248 Months in PrisonRead the Press Release
PHILADELPHIA - Michael Green, 33, of Philadelphia, PA, was sentenced today to 248 months in prison, including a 60-month mandatory minimum prison term, for the armed carjacking of three men on December 5, 2012. In addition to the prison term, U.S. District Court Judge R. Barclay Surrick ordered five years of supervised release and a $200 special assessment.
Judge Surrick ordered Green to serve this sentence partially consecutively to a 180-month federal sentence Green is already serving for his earlier conviction in a multi-year drug trafficking conspiracy.
On the night of December 5, 2012, Green and an accomplice disguised themselves as police officers, with fake police clothing, badges and guns. Using fake police lights, Green and his accomplice pulled over three men who were returning from a funeral in a Chevrolet Silverado pick-up truck, claimed to be police officers, and then carjacked the victims at gunpoint. After handcuffing the three men and forcing them into the back seat of the truck, Green pistol-whipped the victims and threatened to kill them. The three victims managed to escape by leaping from the moving vehicle, with one of them suffering serious injuries in the process.
Green was arrested after the victims located and identified the car Green and his accomplice had used to pull them over. A search warrant revealed that Green had rented the car in his own name, and had left his wallet with his identification and credit cards as well as his cell phones inside the car. On July 23, 2014, a federal jury found Green guilty of carjacking, and using a firearm during a crime of violence.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and Homeland Security Investigations and was prosecuted by Assistant United States Attorneys V. Paige Pratter and Mark S. Miller.
Two Women Sentenced for Role in Bath Salts ConspiracyRead the Press Release
SCRANTON—The United States Attorney’s Office for the Middle District of Pennsylvania announced that Treiu Thuy Duong, age 37, of Sarasota, Florida, and Maura Kathio, age 27, of Yatesville, Pennsylvania, were sentenced today by U.S. District Court Judge Malachy E. Mannion in Scranton, for drug related offenses.
According to United States Attorney Peter Smith, Duong, who resided in Texas at the time of her arrest, was sentenced today to serve 70 months in prison and ordered to forfeit her interest in more than $750,000 in assets for her role in a conspiracy to distribute and possess with intent to distribute alpha-pvp, commonly known as “bath salts.”
Duong admitted to conspiring with others to distribute alpha-pvp to customers in at least 32 states, including Pennsylvania, over various web sites during 2011 through March 2014.
Treiu Thuy Duong was indicted by a federal grand jury in March 2014.
Judge Mannion ordered the defendant to forfeit to the government her interest in a residence in Texas valued at approximately $300,000, coins valued at more than $260,000, four bank accounts containing over $200,000, two vehicles, over $7000 in cash and more than $17,000 in uncashed money orders, and two firearms. Duong must also spend three years on supervised release following her prison sentence.
Kathio was sentenced to 18 months in prison for her role in a drug conspiracy that distributed alpha-pvp in 2012-2013 in the Luzerne County area. Kathio, previously pleaded guilty to conspiracy to distribute alpha-pvp. Kathio admitted to participating in the West Pittston-based drug conspiracy and to distributing 150 grams of alpha-pvp, a controlled substance analogue.
Kathio was indicted by a federal grand jury in Scranton in August 2014.
Judge Mannion also ordered Kathio to be placed on three years of supervised release following her prison sentence.
Eleven persons have been charged as participants in the conspiracy which involved wholesale suppliers of alpha-pvp based in Texas, and retail distributors of the drug in Luzerne County. All eleven suspects have entered guilty pleas in the case.
The investigation was conducted by agents of the Department of Homeland Security, the Drug Enforcement Administration, United States Postal Inspectors, the Pennsylvania State Police, and West Pittston Police. Assistant U.S. Attorney Francis P. Sempa prosecuted the case.
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Two Local Men Sentenced on Synthetic Drug Trafficking ChargesRead the Press Release
St. Louis, MO – The two leaders of a multi-defendant synthetic drug trafficking conspiracy were sentenced today in federal court in St. Louis. Anwer Rao, O’Fallon, IIllinois, was sentenced to 150 months in prison; and Michael Lentsch, also of O’Fallon, Illinois, was sentenced to 150 months in prison. Both appeared before United States District Judge John A. Ross.
The manufacture of synthetic drugs is a recent development designed to circumvent traditional drug laws by creating new chemical compounds that mimic the effects of drugs like marijuana and cocaine but purport to avoid the classification of a controlled substance because of a chemical alteration. The synthetic drugs are most frequently marketed as legitimate products and sold in typical commercial outlets such as convenience stores and gas stations. The drugs masquerade as incense, potpourri, glass cleaner, bath salts and plant food, just to name a few; their cost however is much higher than the normal commercial product they mimic.
One group of synthetic drugs is made up of cathinones, and is a “speed” type drug commonly marketed as bath salts. The synthetic cathinones are typically snorted, and are packaged in containers with names such as Full Throttle, Fresh, Limited, Starry Nights, Twisted, Pump It and Blitz. Rao and Lentsch manufactured and marketed cathinones under the name “Go Go.” Reported effects have included hypertension, paranoia, anxiety and even psychosis.
Another group of synthetic drugs is made from synthetic cannabinoids which are a far more powerful and unpredictable form of marijuana. The cannabinoids are typically smoked and are packaged in multi-gram packets with names such as Mega Kush, Mad Hatter, Bayou Blaster, Avalon, Pirates Booty, Lights Out and Golden Leaf. Rao and Lentsch manufactured and marketed their own blends of synthetic cannabinoids under the names “Mad Hatter,” “Deew.” “Cloud 9 Optima,” “Crazy Eyes,” and “Primo.” Although commonly referred to as synthetic marijuana, the effects are far more powerful and dangerous than so-called natural marijuana, with reported additional effects, including excessive heart rate, vomiting and seizures.
These sentencing’s were part of a multi-defendant case charging offenses involving the importation, manufacturing and sale of these synthetic drugs. Several co-defendants have pled guilty to related charges and await sentencing. Others are still facing trial on charges including: a) conspiracy to distribute and possess with the intent to distribute Schedule I controlled substances and Schedule I controlled substance analogues; b) conspiracy to introduced an receive misbranded drugs in interstate commerce; c) conspiracy to import controlled substances and controlled substance analogues; d) conspiracy to receive, sell and facilitate the transportation of smuggled goods with forfeiture allegations; and e) money laundering counts.
The drug conspiracy charges and money laundering conspiracy charges carry a penalty of up to 20 years in prison for each count and/or fines ranging from $500,000 to $1,000,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges. Additionally, the indictments seek forfeiture of assets and property totaling more than $12 million dollars.
This case was investigated by US Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), Internal Revenue Service Criminal Investigation, Drug Enforcement Administration and the Postal Inspection Service. Additional assistance was received from the St. Louis County Police Department, St. Charles County Sheriff’s Department, Missouri Lake Area Narcotics Enforcement Group, Metropolitan Enforcement Group for Southern Illinois, Southern Illinois Drug Task Force, the Illinois Attorney General’s Office, as well as the prosecuting attorney offices in St. Louis County, Missouri, St. Charles County, Missouri, Madison County, Illinois and St. Clair County, Missouri. Assistant United States Attorneys James Delworth, Erin Granger, Jennifer Winfield and John Mantovani are handling the cases for the U.S. Attorney's Office.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. The remaining defendants are presumed to be innocent unless and until proven guilty.
Two Executives Charged for Conspiring to Eliminate Competition to Supply Water Treatment ChemicalsRead the Press Release
Two water treatment chemicals executives were indicted in Newark, New Jersey, for their roles in a conspiracy to eliminate competition among suppliers of liquid aluminum sulfate to municipalities and pulp and paper companies in the United States, the Department of Justice announced today.
Vincent J. Opalewski, former president, vice president and general manager of a water treatment chemicals manufacturer headquartered in Parsippany, New Jersey, and Brian C. Steppig, director of sales and marketing of a water treatment chemicals manufacturer headquartered in Lafayette, Indiana, are the second and third executives charged in connection with the conspiracy, which sought to eliminate competition for contracts to supply liquid aluminum sulfate. Liquid aluminum sulfate is a coagulant used by municipalities to treat drinking and waste water and by pulp and paper companies in their manufacturing processes.
“Municipalities and pulp and paper companies deserve competitive prices for water treatment chemicals,” said Assistant Attorney General Bill Baer of the Justice Department’s Antitrust Division. “These charges reflect our ongoing efforts to hold accountable those who conspire to cheat their customers responsible for their crimes.”
“These charges send a message that anyone intent on corrupting the free market will be identified and brought to justice,” said Acting Special Agent in Charge Andrew Campi of the FBI’s Newark Division. “Our mission is to protect victims who don't see these crimes occurring, but who always end up paying the price.”
The indictment, returned by a grand jury in the U.S. District Court for the District of New Jersey, alleges that Opalewski, from 2005 to 2011, and Steppig, from 1998 until 2011, and their co-conspirators participated in the conspiracy by meeting to discuss each other’s liquid aluminum sulfate business, agreeing to stay away from each other’s historical customers, submitting intentionally losing bids to favor the intended winner of the business, withdrawing inadvertently winning bids and discussing with each other prices to be quoted to municipalities and pulp and paper companies.
The charges contained in the indictment are allegations and not evidence of guilt. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The investigation into collusion in the liquid aluminum sulfate industry is being conducted by the New York Office of the Antitrust Division and the FBI’s Newark Division. Anyone with information regarding price fixing, bid rigging or customer allocation in the sale and marketing of liquid aluminum sulfate should contact the Antitrust Division’s New York Office at 212-335-8000, call the Antitrust Division’s Citizen Complaint Center at 1-888-647-3258, or visit www.justice.gov/atr/contact/newcase.htm.
Opalewski Steppig Indictment (313.51 KB)
Three Men Charged in Drug Related Homicide of Two Men in Tangipahoa ParishRead the Press Release
U.S. Attorney Kenneth A. Polite announced that DON RAINES, age 34, TRAVON PITTS, age 28, and BARON SMITH, age 36, all of Tangipahoa Parish, have been charged in a superseding Bill of Information with participating in the October 9, 2015 murders of QUANDELL BEARD and ELLIOT SMITH in Tangipahoa Parish. Count One charges RAINES and PITTS with committing second degree murder by using a firearm during the course of a drug trafficking crime. Count Two charges SMITH with committing first degree murder as a result of the same firearms offense.
RAINES, PITTS and SMITH are currently in federal custody and have been detained without bond. Trial in this matter is currently set before U.S. District Judge Lance M. Africk on April 4, 2016.
All three defendants face a sentence of up to life in prison, a fine of up to $250,000 and up to five years of supervised release.
United States Attorney Polite reiterated that the Bill of Information is merely a charged and that the guilt of the defendants much be proven beyond a reasonable doubt.
U.S. Attorney Polite praised the work of the Tangipahoa Parish Sheriff’s Office and the United States Drug Enforcement Administration in investigating this matter. Assistant United States Attorney Maurice E. Landrieu, Jr. is in charge of the prosecution.
Three Family Members Receive Life Sentences for Courthouse Murder ConspiracyRead the Press Release
David T. Matusiewicz, Lenore Matusiewicz and Amy Gonzalez were sentenced yesterday in federal court in Delaware to life in prison for the February 2013 murder of David Matusiewicz’s ex-wife and a friend at the New Castle County Courthouse, announced Acting U.S. Attorney David C. Weiss for the District of Delaware, Special Agent in Charge Kevin L. Perkins for the Federal Bureau of Investigation’s (FBI) Baltimore Division and Colonel Nathaniel McQueen Jr. for the Delaware State Police.
Following a five week jury trial this past summer, the defendants were convicted of conspiracy, interstate stalking resulting in death and cyberstalking resulting in death. This was the first case in the nation where defendants were convicted of cyberstalking resulting in death.
After a lengthy sentencing hearing in Delaware, Judge McHugh concluded that David Matusiewicz and his father, Thomas Matusiewicz, acted with premeditated intent in the Feb. 11, 2013, murder of his ex-wife, Christine Belford, at the New Castle County Courthouse. Thomas Matusiewicz also shot and killed Laura “Beth” Mulford, who accompanied Belford to the courthouse that morning. Judge McHugh determined that, based on defendant’s repeated criminal conduct and the serious nature of the offense, which included “contempt for the law,” only a life sentence would protect the community and Belford’s children.
Lenore Matusiewicz and Gonzalez likewise received life sentences from Judge McHugh. Lenore Matusiewicz was sentenced at her bedside last week at Jefferson Medical Center in Philadelphia, Pennsylvania. Gonzalez was sentenced after her brother’s sentence was imposed. Judge McHugh concluded that Gonzalez’s overall stalking conduct was inextricably intertwined with the conduct of her family members and that it was reasonably foreseeable to Gonzalez that an act of violence would occur when her brother, mother and father left for Delaware in early February 2013.
“The life sentences imposed by Judge McHugh were necessary to punish the defendants and to protect Christine Belford’s children and our community,” said Acting U.S. Attorney Weiss. “We hope that these sentences provide some comfort to the victims’ families and we thank the law enforcement and legal communities for their contributions to the successful prosecution of this case.”
“The Matusiewicz family caused a lot of unnecessary harm in this case, killing and injuring innocent people for no reason, said Special Agent in Charge Perkins. “This ground-breaking prosecution and investigation shows people who actively take part in planning crimes, even though they don't pull the trigger, will be held accountable.”
“The Delaware State Police supports the decision of the jury and the judge for holding all defendants in this case fully accountable for their actions,” said Colonel McQueen Jr. “The successful prosecution and sentencing of the defendants responsible in the first federal conviction of cyber-stalking resulting in death is truly welcomed news for all federal, state and local law enforcement involved in the investigation. This investigation is a landmark case that emphasizes the impact and benefit to the community when all agencies are working together.”
According to the evidence presented at trial and sentencing, David Matusiewicz and Belford were involved in divorce and child custody proceedings in the family court of Delaware in 2007. In August 2007, David Matusiewicz and his mother, Lenore Matusiewicz, kidnapped the three young children born of his marriage to Belford and fled to South America. In March 2009, David and Lenore Matusiewicz and the young children were found living in a motor home in Nicaragua. David and Lenore Matusiewicz were arrested and prosecuted in Delaware and the children were returned to the care of their mother. In September 2009, David and Lenore Matusiewicz each pleaded guilty to crimes relating to their kidnapping of the children.
In December 2009, David Matusiewicz was sentenced in federal court to 48 months in prison, to be followed by five years of supervision by the U.S. Probation Office. In the days following his December 2009 sentencing, David Matusiewicz began to orchestrate, from his prison cell, a course of conduct designed to stalk, harass and intimidate Belford and her children. He enlisted his father, mother, sister and various other persons in this effort, which stretched from December 2009 to February 2013. The Matusiewicz family’s stalking campaign included broad dissemination -- by mail, email, websites, Internet postings and other means – of false and defamatory allegations against Belford.
After his release from federal custody, David Matusiewicz resided in southern Texas. On Jan. 8, 2013, David Matusiewicz sought and received permission from the U.S. Probation Office in Texas to travel to Delaware to attend a child support arrearage hearing he had requested. That hearing was scheduled for Feb. 11, 2013. David Matusiewicz never informed the probation officer that he intended to travel to Delaware with Thomas and Lenore Matusiewicz.
On the morning of Feb. 11, 2013, David and Thomas Matusiewicz drove to a hotel parking garage near the New Castle County Courthouse in a Honda CRV, which contained ammunition, a military style knife, three sets of restraints of progressively smaller sizes, a bullet proof vest, an electric shock device, binoculars and photographs of Belford’s children and residence. After entering the courthouse lobby at approximately 7:30 a.m., David Matusiewicz entered and stayed in the security screening line, while Thomas Matusiewicz moved around the lobby, occasionally approaching and talking to David Matusiewicz.
Shortly before 8:00 a.m., David Matusiewicz passed through courthouse security screening and walked to another floor of the building. Thomas Matusiewicz remained in the lobby, where he shot Belford multiple times as she entered the courthouse lobby, killing her. He then shot Mulford multiple times as she attempted to flee. After a shootout during which he shot and injured two Capitol Police officers, Thomas Matusiewicz died on the sidewalk of the courthouse of a self-inflicted gunshot wound.
This case was investigated by the FBI and the Delaware State Police and is being prosecuted by Assistant U.S. Attorneys Jamie M. McCall and Shawn A. Weede.
Tampa Man Sentenced to Fifteen Years for Gun ChargesRead the Press Release
Tampa, FL – U.S. District Judge Richard A. Lazzara today sentenced Cedric Monroe (35, Tampa) to 15 years in federal prison for possessing a firearm as a convicted felon. Monroe pleaded guilty to this offense on December 4, 2015.
According to court documents, Monroe sold crack cocaine and a firearm to a confidential informant in the bathroom of a local restaurant. At the time of the incident, Monroe had been previously convicted of multiple drug offenses. As a convicted felon, he was prohibited from possessing a firearm or ammunition under federal law.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Tampa Police Department. It was prosecuted by Assistant United States Attorney Stacie B. Harris.
This is another case prosecuted as a part of the Department of Justice’s “Project Safe Neighborhoods” Program - a nationwide, gun-violence reduction strategy. United States Attorney A. Lee Bentley, III, along with Regina Lombardo, Special Agent in Charge, ATF, is coordinating the Project Safe Neighborhoods effort here in the Middle District of Florida in cooperation with federal, state, and local law enforcement officials. It is also a part of ATF’s Frontline strategy to reduce violence in our communities.
Tampa Area Defendants Convicted of Identity Theft OffensesRead the Press Release
G. F. Peterman, III, Acting United States Attorney for the Middle District of Georgia, announced today that verdicts of guilty were rendered on all seven counts of an indictment against Defendants Leonardo Hernandez-Triana, age 32, and Yadina Valdes-Dias, age 36, both from Tampa, Florida, charging them with identity theft-related offenses. The case was tried before the Honorable W. Louis Sands, Senior United States District Judge for the Middle District of Georgia, Albany Division.
Count One of the indictment charged the defendants with possession of twenty counterfeit or unauthorized Walmart gift cards. Count Two charged the defendants with unlawful possession of two “skimmer” devices. Counts Three through Seven charged the defendants with aggravated identity theft based upon their fraudulent possession of personal account information of five different persons from the Bowling Green and Greenville, Kentucky area.
The case arose out of a traffic stop of the defendants’ vehicle on October 21, 2014, on Interstate 75 in Turner County. During the course of the traffic stop, law enforcement officers received consent from defendant Hernandez-Triana to search their vehicle. The officers discovered twenty counterfeit Walmart gift cards and two skimmer devices designed to be placed inside a gasoline pump to collect the account information of debit and credit cards used at that pump. The government’s evidence at trial showed that the persons whose accounts were compromised all made debit or credit card purchases of gasoline at about the same time from a particular convenience store in Greenville, Kentucky. The evidence further showed that what appeared on their face to be twenty Walmart gift cards were in fact encoded with a magnetic strip containing the personal account information of those twenty persons whose identity data was stolen.
Clint A. Bush, Resident Agent in Charge, U.S. Secret Service, Albany, Georgia Resident Office stated: “Identity theft, to include credit card fraud, is an ever increasing problem in our country. Victims of these crimes often have long lasting effects. The United States Secret Service, along with its law enforcement partners, remains committed to aggressively investigating those responsible for committing these crimes and bringing them to justice.”
Acting United States Attorney Pete Peterman stated: “Some individuals believe that identity theft and credit card fraud are minor felonies, but that is a mistaken belief. Thousands of people suffer the indignity of having their identities stolen and then spend years trying to get back their good name. Defendants who commit identity theft crimes will be prosecuted to the full extent of the law.”
The case was investigated jointly by the United States Secret Service, Ashburn Police Department, the Georgia State Patrol, and the Tift County Sheriff’s Office. Assistant United States Attorney Alan Dasher prosecuted the case on behalf of the Government.
Questions concerning this case should be directed to Pamela Lightsey, Public Information Officer, United States Attorney’s Office, at (478) 621-2603.
Sutton County Man Sentenced to 262 Months in Federal Prison for Enticing a Minor and Producing Child PornographyRead the Press Release
LUBBOCK, Texas — Marcos Antonio Gamez, 23, of Sonora, Texas, was sentenced this morning by Senior U.S. District Judge Sam R. Cummings to 262 months in federal prison, following his guilty plea in October 2015 to one count of production of child pornography and one count of enticement of a minor. Today’s announcement was made by U.S. Attorney John Parker of the Northern District of Texas.
Gamez has been in custody since his arrest in August 2015.
According to documents filed in his case, in March 2015, Gamez engaged in sexually explicit conduct with a minor female, and he used his cellphone to produce a video of that conduct. Gamez also persuaded this minor female to recruit another minor female to join them in sexually explicit conduct, but this second minor female declined to participate.
The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
The Texas Department of Public Safety, Texas Rangers, the Sonora Police Department, the Sutton County Sheriff’s Office and U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) investigated the case. Assistant U.S. Attorney Steven M. Sucsy, of the U.S. Attorney’s Office in Lubbock, Texas, was in charge of the prosecution.
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St. Thomas Man Pleads Guilty to Attempted Possession with Intent to Distribute MarijuanaRead the Press Release
St. Thomas, USVI – On Friday, February 19, 2016, Kyle Michael Brumett, 24, pleaded guilty in federal court to attempted possession with intent to distribute four kilograms of marijuana, United States Attorney Ronald W. Sharpe announced.
According to the plea agreement filed with the court, on November 24, 2015, Brumett and Jordan Andrew Foster went to the Mail Stop at Crown Bay Marina on St. Thomas to pick up a package addressed to Brumett which was tracked by the United States Postal Inspection Service (USPIS) and the U.S. Drug Enforcement Administration (DEA). When Foster exited the Mail Stop with the package, he was observed placing it in a vehicle Brumett was driving. Foster pleaded guilty to possession with intent to distribute marijuana on February 10, 2016.
Brumett faces a maximum sentence of five years imprisonment and a $250,000 fine. District Court Judge Curtis V. Gomez continued Brumett’s status in official detention. A sentencing date has been set for June 13, 2016.
This case was investigated by the USPIS and the DEA and prosecuted by Nelson L. Jones, Assistant U.S. Attorney.
St. Croix Man Sentenced for Robbery and Related OffensesRead the Press Release
St. Croix, USVI – Senior District Court Judge Raymond Finch on February 19, 2016, sentenced Edigberto Diaz, 46, to 7 years in federal prison for Using and Carrying a Firearm during and in Relation to a Crime of Violence and 21 months for Interference with Commerce by Robbery, United States Attorney Ronald W. Sharpe announced. The sentences are to be served consecutively. Judge Finch also sentenced Diaz to two terms of supervised release to be served concurrently, a fine of $2,000, and a special monetary assessment of $100.
Diaz pleaded guilty on August 18, 2015. According to the plea agreement filed with the court, on June 21, 2014, Diaz and his co-defendant, Daniel Ramos, armed with handguns, entered Quality Foods located at Estate Castle Coakley in St. Croix. They went into an office area, pointed their handguns at two individuals, and demanded that they open the safe. The defendant and co-defendant removed deposit bags containing $24,289.17 in cash and checks from the safe. They also took cellular telephones, a music player, a laptop computer, a checkbook, and backpacks from the victims. Diaz, who was carrying a Smith & Wesson .40 caliber semiautomatic handgun with an obliterated serial number loaded with 14 rounds of ammunition, was shot by the police while being apprehended at the scene of the crime. A sentencing date has been set for May 23, 2016, for Ramos.
This case was investigated by the Virgin Islands Police Department and the Federal Bureau of Investigation. It was prosecuted by Assistant U.S. Attorney Rhonda Williams-Henry.
Shippensburg Woman Sentenced to 120 Months in Federal Prison for Heroin Trafficking Resulting in DeathRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Ashley Gries, age 21, of Shippensburg, Pennsylvania, was sentenced yesterday by U.S. District Court Chief Judge Christopher C. Conner to 120 months incarceration for heroin trafficking that resulted in the death of a local young man.
Gries pleaded guilty on August 10, 2015 to conspiring with co-defendants Danny Forrester, Gabriel Stouffer, and Eugene Stallings, Jr. to distribute heroin that resulted in the death of Kyle Golter, a 21 year old resident of Newburg, Pennsylvania. Gries has been detained since her arrest on March 5, 2014. Forrester, and Stouffer have pleaded guilty for their roles in this drug trafficking organization. Stallings was convicted on February 5, 2016 after a jury trial. Chief Judge Conner previously sentenced Forrester to 180 months incarceration. Stouffer and Stallings have not yet been sentenced.
According to United States Attorney Peter Smith, Gries, Forrester and Stouffer traveled from the Shippensburg area to purchase heroin from Stallings in Baltimore, Maryland, and then engaged in heroin trafficking in Franklin and Cumberland County. Heroin obtained from Stallings led to the death of 21 year old Kyle Golter in Newburg on February 7, 2014. Franklin County Coroner Jeffrey R. Conner determined that the cause of Golter’s death was the result of heroin toxicity.
This case was investigated by the Drug Enforcement Administration, the Pennsylvania State Police, the Shippensburg Police Department, and the Cumberland County Drug Task Force. The case was prosecuted by Assistant United States Attorney Meredith A. Taylor.
This case is part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the heroin initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies.
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San Antonio Man Arrested and Charged in Alleged Laser Strike IncidentRead the Press Release
In San Antonio today, FBI agents arrested 24–year-old Christopher B. Evans for allegedly pointing a laser in the flight path of a helicopter announced United States Attorney Richard L. Durbin, Jr., and FBI Special Agent in Charge Christopher B. Combs, San Antonio Division.
Evans was charged in a one count federal indictment on February 17, 2016, of aiming a laser pointer at aircraft in flight. The indictment stems from an incident on the morning of October 27, 2015, when a local television news helicopter reported being struck by a laser north of the airport.
Upon conviction, the defendant faces up to five years in federal prison and a maximum $250,000 fine.
According to the FBI, in 2015, San Antonio ranked among the top 15 cities in the nation for laser strikes, with almost 100 reported. Laser strikes can blind pilots of airborne aircraft, jeopardizing the lives of persons aboard.
If you have information about a lasing incident, contact the San Antonio FBI at 210-225-6741. If you see someone pointing a laser at an aircraft, call the nearest local law enforcement agency immediately by dialing 911. Tips can also be submitted online at https://tips.fbi.gov.
This indictment resulted from an investigation conducted by agents with the Federal Bureau of Investigation together with the San Antonio Police Department. Assistant United States Attorney Michael R. Hardy is prosecuting this case on behalf of the Government.
An indictment is merely a charge and should not be considered as evidence of guilt. The defendant is presumed innocent until proven guilty in a court of law.
Salvadoran Man Convicted of Sex Trafficking and Sex Tourism Involving a 14-Year-old Victim from El SalvadorRead the Press Release
ALEXANDRIA, Va. – Eric Noe Araujo Flores, aka Eric Araujo Orellano, 34, a citizen of El Salvador who lives in Ashburn, was convicted today by a federal jury on charges of sex trafficking of a child, foreign travel with intent to engage in illicit sexual conduct, and harboring an alien for an immoral purpose, and coercion and enticement.
Araujo Flores was indicted on Nov. 19, 2015. According to court records and evidence at trial, Araujo Flores contacted his former nanny in El Salvador in an effort to find a teenage Salvadoran girl. The nanny put Araujo Flores in touch with her 14-year-old niece, who informed Araujo Flores that a gang had threatened to harm her and her family and that she needed help. Araujo Flores obtained photographs of the girl and then promised to help the girl if she would have sex with him. Beginning in July 2013, Araujo Flores made three trips from Dulles International Airport to El Salvador to have sex with the victim. Araujo Flores paid cash for some of the sex acts. He also provided the victim and her family with jewelry, food, and clothing, paid to have them move residences, and paid her family’s rent.
Seeking immediate access to the victim, Araujo Flores arranged and paid to have the victim and her mother smuggled into the United States through Texas in June 2014. He then harbored them at a house he owned in Sterling. Araujo Flores allowed them to live there rent-free in exchange for sex with the victim, who was then 15-years-old. Araujo Flores provided the victim with a counterfeit permanent resident card which included a false birthdate indicating she was over the age of 18. He also continued to provide food and jewelry to the victim.
Araujo Flores will be sentenced on June 3, 2016, and faces a mandatory minimum of 10 years in prison and a maximum penalty of life in prison. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Thomas Haycraft, Acting Special Agent in Charge of the Diplomatic Security Service of U.S. Department of State; Michael L. Chapman, Loudoun County Sheriff; and Colonel Edwin C. Roessler, Jr., Fairfax County Chief of Police, made the announcement after the verdict was accepted by U.S. District Judge Liam O’Grady. Assistant U.S. Attorney Michel J. Frank is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:15-cr-320.
Ramah Navajo Man Sentenced to 78 Months for Voluntary Manslaughter ConvictionRead the Press Release
ALBUQUERQUE — Allen Norton, 45, an enrolled member of the Navajo Nation who resides in Ramah, N.M., was sentenced today in federal court in Santa Fe, N.M., to 78 months in prison for his voluntary manslaughter conviction. He will be on supervised release for three years after completing his prison sentence.
Norton was arrested on April 27, 2015, on a criminal complaint charging him with killing a man on April 25, 2015, by stabbing him. The crime occurred at the victim’s residence on the Navajo Indian Reservation in McKinley County, N.M.
Norton was subsequently indicted on May 12, 2015, on a voluntary manslaughter charge. On Sept. 22, 2015, Norton pled guilty to the indictment and admitted killing the victim by stabbing him with a knife.
This case was investigated by the Albuquerque office of the FBI and the Ramah Navajo Tribal Police Department. Assistant U.S. Attorney Sarah Mease prosecuted the case.
Perry County Man Sentenced to 77 Months in Prison for Federal Firearms ViolationsRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that David Auman, age 37, of Liverpool, was sentenced yesterday to 77 months in prison by U.S. District Court Judge John E. Jones, III, after pleading guilty to being a convicted felon in possession of a firearm.
According to U.S. Attorney Peter Smith, Auman was indicted by a federal grand jury in Harrisburg in May 2015, as a result of an investigation by the Harrisburg Police Department, the Pennsylvania State Police and the Harrisburg Field Office of the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant United States Attorney William A. Behe prosecuted the case.
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Oregon Man Pleads Guilty to Hacking Apple E-Mail AccountsRead the Press Release
LOS ANGELES – An Oregon man has pleaded guilty to a felony computer hacking charge related to a phishing scheme that gave him illegal access to 363 Apple and Google e-mail accounts, including those belonging to members of the entertainment industry in Los Angeles.
Andrew Helton, 29, of Portland, pleaded guilty yesterday to a felony violation of the Computer Fraud and Abuse Act, specifically a charge of unauthorized access to a protected computer to obtain information.
Helton pleaded guilty before United States District Judge John A. Kronstadt, who scheduled a sentencing hearing for June 2. As a result of yesterday’s guilty plea, Helton faces a statutory maximum sentence of five years in federal prison.
“In today’s digital world, people use their e-mail and online accounts to store photos, music, notes, calendars, contacts, financial, and health information,” said United States Attorney Eileen M. Decker. “Through prosecutions such as the one announced here today, the United States Attorney’s Office is committed to assisting the continuing efforts of private companies to protect this sensitive and personal information from the malicious actions of sophisticated hackers and cyber criminals.”
According to his plea agreement, from March 2011 to May 2013, Helton engaged in a phishing scheme to obtain usernames and passwords for his victims. He sent e-mails to victims that appeared to be from Apple or Google and asked victims to “verify” their accounts by clicking on a link. Once the victims clicked on the link, they were taken to a malicious website that looked like an Apple or Google login page. When the victims entered usernames and passwords on the malicious website, Helton then had access to the victims’ e-mail accounts.
As a result of his scheme, Helton obtained approximately 448 usernames and passwords for approximately 363 e-mail accounts. Helton used this information to access and view the contents of the e-mail accounts.
Many of Helton’s victims were members of the entertainment industry in Los Angeles. By illegally accessing the e-mail accounts, Helton obtained 161 sexually explicit, nude and/or partially nude images of approximately 13 victims, some of whom were celebrities.
“The thought of a stranger accessing your private communications for sport or monetary gain can be devastating,” said David Bowdich, the Assistant Director in Charge of the FBI’s Los Angeles Field Office. “This insidious crime has distressed scores of average individuals, as well as celebrity victims. The FBI is committed to holding accountable those who illegally intrude upon the cyber landscape, and to educating consumers about strengthening passwords and employing two-factor authentication, among other safeguards.”
The case against Helton is the product of an investigation by the Federal Bureau of Investigation.
Ohio Man Sentenced to 108 Months in Prison for Money Laundering in Connection with Costa Rica-Based Telemarketing Fraud SchemeRead the Press Release
An Ohio man was sentenced to 108 months in prison for his role in laundering money for a Costa Rica-based “sweepstakes fraud” scheme that victimized U.S. residents, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Jill Westmoreland Rose of the Western District of North Carolina.
Paul R. Toth Jr., 41, of Wintersville, Ohio, was sentenced yesterday by U.S. District Judge Robert J. Conrad Jr. of the Western District of North Carolina. In addition to imposing the prison sentence, Judge Conrad ordered Toth to pay $307,702 in restitution and to forfeit the same amount.
Toth was convicted on Aug. 4, 2015, following a two-day jury trial, of one count of conspiracy to commit money laundering and six counts of international money laundering stemming from his role in laundering money for a scheme to defraud two U.S. residents over the age of 55 out of more than $300,000 in savings. The evidence at trial showed that telemarketers in Costa Rica, who were the defendant’s co-conspirators, posed as federal agents and deceived the two victims, who were husband and wife, into believing that they had won a large monetary prize in a sweepstakes contest. The co-conspirators falsely told the victims that in order to receive the “prize,” the victims had to wire thousands of dollars to Costa Rica for a “refundable insurance fee.”
The evidence at trial showed that, between approximately November 2009 and November 2010, Toth was a U.S.-based “smasher,” an individual who arranges to pick up victims’ money and take it to the fraudulent telemarketing organization, who facilitated the laundering of funds received from the elderly victims. Specifically, according to trial evidence, Toth and others he recruited and supervised received more than $300,000 from victims and, using various individuals as senders and recipients to conceal the fraudulent nature of the transactions, wired more than $200,000 to co-conspirators in Costa Rica. The evidence further demonstrated that Toth kept the remainder as his profit.
The U.S. Postal Inspection Service, Internal Revenue Service, FBI, Federal Trade Commission and Department of Homeland Security investigated the case. Senior Litigation Counsel Patrick M. Donley and Trial Attorneys William H. Bowne and Anna Kaminska of the Criminal Division’s Fraud Section prosecuted the case.
North Carolina Man Pleads Guilty in U.S. Treasury Check SchemeRead the Press Release
WASHINGTON – A Smithfield, North Carolina man pleaded guilty today to one count of a dual object conspiracy to defraud the United States and commit theft of public money, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and Acting U.S. Attorney John Stuart Bruce of the Eastern District of North Carolina.
According to court documents, Oscar Barahona Fiallos, 52, owned and operated a tax preparation business in Smithfield. In 2011 and 2012, Fiallos cashed large numbers of U.S. Treasury checks issued as a result of fraudulent tax returns filed with the Internal Revenue Service (IRS) in the names of third parties. The checks were provided to Fiallos by co-conspirators and Fiallos never met the third-party payees, who purportedly lived in New York, New Jersey and North Carolina. Fiallos deposited the checks into his bank account and then provided co-conspirators with cash equal to the value of the check, less a check cashing fee. After a bank account was closed, Fiallos obtained a check cashing license so that he could continue cashing checks for his co-conspirators. He also prepared Individual Taxpayer Identification Number applications and false tax returns for third parties he did not meet and who did not sign the documents.
Fiallos faces a statutory maximum sentence of five years in prison. In his plea agreement, he has agreed to pay restitution to the United States in the amount of $2,802,496. The sentencing hearing is set for June.
Acting Assistant Attorney General Ciraolo and Acting U.S. Attorney Bruce commended special agents of IRS-Criminal Investigation, who investigated the case and Trial Attorneys Lauren M. Castaldi and Nathan P. Brooks of the Tax Division, who are prosecuting this case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
New York State Correction Officer and Saratoga Woman Charged in Marijuana Distribution ConspiracyRead the Press Release
PLATTSBURGH, NEW YORK – Brad Rushford, 33, of Ellenburg Depot, New York, and Freda Rushford, 62, of Saratoga Springs, New York, were arraigned today on charges related to a marijuana distribution conspiracy operating in upstate New York, announced United States Attorney Richard S. Hartunian.
The indictment charges both defendants with conspiracy to possess with intent to distribute and to distribute 100 kilograms or more marijuana. Freda Rushford is also charged with making a false statement to federal officers.
If convicted of the conspiracy charge, both defendants face at least 5 years and up to 40 years in prison, a maximum fine of $5 million, and a term of supervised release of at least 4 years and up to life. The false statement charge against Freda Rushford carries a maximum sentence of 5 years in prison, a fine of up to $250,000, and a term of supervised release of up to 3 years.
The defendants were arraigned in Plattsburgh, New York, before United States Magistrate Judge Garry L. Favro. Trial is scheduled for April 18, 2016 before United States District Judge David N. Hurd in Utica, New York.
Brad Rushford, who is Freda Rushford’s son, worked as a correction officer with the New York State Department of Corrections and Community Supervision.
The charges in the indictment are merely accusations. The defendants are presumed innocent until proven guilty.
This case is being investigated by the Department of Homeland Security, Homeland Security Investigations, Federal Bureau of Investigation, U.S. Customs and Border Protection, U.S. Coast Guard Investigative Service, New York State Department of Corrections and Community Supervision, Office of Special Investigations, New York State Police, and St. Regis Mohawk Tribal Police, and is being prosecuted by Assistant U.S. Attorney Cyrus P.W. Rieck.
Middle Tennessee Physicians and Owners of Medical Equipment Companies Plead Guilty in Kickback SchemesRead the Press Release
Dr. Bruce Rubinowicz, 53, of Aventura, Florida and previously of Franklin, Tennessee, pleaded guilty today to one count of soliciting and receiving a cash kickback in exchange for patient referrals, announced David Rivera, United States Attorney for the Middle District of Tennessee.
During a hearing before U.S. District Court Judge Aleta A. Trauger, Rubinowicz admitted that, as a physician who operated several sleep labs in Middle Tennessee, he agreed to receive cash kickbacks in exchange for referring patients to Air Affiliates, a Nashville based medical supplier. Rubinowicz admitted accepting a total of $22,900 in cash kickbacks, in exchange for referring patients to Air Affiliates, who provided these patients continuous positive airway pressure (“CPAP”) ventilators. Rubinowicz further acknowledged that some of the patients he referred in exchange for cash payments were Medicare beneficiaries.
Rubinowicz faces up to five years in prison and a $25,000 fine when he is sentenced by Judge Trauger on May 13, 2016. His sentence will be imposed by the Court after consideration of the U.S. Sentencing Guidelines and applicable federal statutes.
This guilty plea follows several other recent convictions in this district involving individuals who paid for or accepted cash kickbacks in exchange for patient referrals, including:
- On August 6, 2015, Bradley Sensing, 55, of Nashville, pleaded guilty to one count of paying cash kickbacks in exchange for patient referrals. Sensing was the owner of Air Affiliates, a company that provided CPAP ventilators. Sensing is scheduled to be sentenced by Judge Campbell on May 9, 2016.
- On November 10, 2015, Lane Wilkinson, 67, of Spring Hill, Tennessee, pleaded guilty to one count of soliciting and receiving cash kickbacks from a supplier in exchange for making referrals for medical equipment. Wilkinson was the owner and operator of a medical equipment supply company located in Columbia Tennessee. Wilkinson is scheduled to be sentenced by U.S. District Judge Todd J. Campbell on March 7, 2016. Wilkinson and Sensing also face up to five years in prison and a $25,000 fine.
- On November 12, 2015, Dr. Thomasz Zurawek, 52, of Centerville, Tennessee, was sentenced by Judge Trauger to two months in prison and a term of supervised release in connection with his role in a kickback scheme. Zurawek had pleaded guilty to one count of soliciting and receiving cash kickbacks from a medical equipment supplier in exchange for referring patients to that supplier.
These cases were investigated by the Federal Bureau of Investigation, the Tennessee Bureau of Investigation, and the U.S. Department of Health and Human Services Office of Inspector General. The cases are being prosecuted by Assistant U.S. Attorneys William F. Abely and Thomas J. Jaworski.
Methamphetamine Trafficker Sentenced to 400 Months in Federal PrisonRead the Press Release
FORT WORTH, Texas — The last defendant to be sentenced in a methamphetamine distribution conspiracy that operated in North Texas for two years was sentenced today to a lengthy federal prison sentence, announced U.S. Attorney John Parker of the Northern District of Texas.
Ismael Rico, 32, of Dallas, was sentenced by U.S. District Judge John McBryde to serve 400 months in federal prison, following his guilty plea in August 2015 to one count of conspiracy to possess with the intent to distribute methamphetamine. According to documents filed in the case, Rico and co-defendant David Godinez conspired with each other to possess with intent to distribute more than 50 grams of methamphetamine. Godinez, 30, of Mesquite, Texas, was sentenced last month to 250 months in federal prison.
Earlier this month, co-defendants James Gatlin, 40, of Garland, Texas, was sentenced to 320 months in federal prison; Matthew Ryan Thompson, 44, of Mineral Wells, Texas, was sentenced to 420 months; and Celeste Monette Blair, 45, of Jacksonville, Florida, was sentenced to 360 months. Each pleaded guilty to one count of conspiracy to possess with intent to distribute methamphetamine. Gatlin, Thompson and Blair admitted receiving multi-ounce quantities of methamphetamine from others in the conspiracy that they distributed to others.
The other four defendants convicted in the case have been sentenced to prison terms ranging from 250 to 480 months. Each defendant pleaded guilty to one count of conspiracy to possess with intent to distribute methamphetamine.
The Bureau of Alcohol, Tobacco, Firearms and Explosives, the Drug Enforcement Administration and the Texas Department of Public Safety investigated. Assistant U.S. Attorney Shawn Smith prosecuted.
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Martinsville Man Pleads Guilty to Firearm ChargeRead the Press Release
DANVILLE, VIRGINIA – United States Attorney John P. Fishwick Jr. announced that Kelly Johnson pled guilty today in the United States District Court for the Western District of Virginia in Danville to a federal gun charge.
Kelly Lovon Johnson, 29, of Martinsville, Va. pled guilty today to one count of possessing a firearm in furtherance of a drug trafficking offense.
“Keeping firearms out of the hands of individuals who have lost their legal right to possess a weapon is paramount to improving community safety,” United States Attorney John P. Fishwick Jr. said today.
According to evidence presented at trial by Assistant United States Attorney Andrew Bassford, Johnson, who is a previously convicted felon, was found to be illegally in possession of a firearm while also in possession of marijuana.
The investigation of the case was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Martinsville Police Department. Assistant United States Attorney Andrew Bassford prosecuted the case for the United States.
Marion County Man Indicted on Child Pornography ChargesRead the Press Release
St. Louis, MO – Donald Ray Pafford, Hannibal, Missouri, was indicted for his alleged receipt of child pornography between December 30, 2015, and January 1, 2016.
If convicted, receipt of child pornography carries a penalty range of 15 to 40 years in prison and/or fines up to $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated the Kirksville Office of the Federal Bureau of Investigation, the Hannibal Police Department and the Marion County Prosecuting Attorney’s Office. Assistant United States Attorney Rob Livergood is handling the case for the U.S. Attorney's Office.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
Jury finds Jefferson County man guilty of methamphetamine traffickingRead the Press Release
MARTINSBURG, WEST VIRGINIA – A federal jury returned a guilty verdict yesterday convicting Francisco Gaspar Sanchez, 56, of Kearneysville, West Virginia, of methamphetamine trafficking, United States Attorney William J. Ihlenfeld, II, announced.
Evidence presented at trial indicated that Sanchez conspired with another individual to sell crystal methamphetamine in Jefferson County, West Virginia. Specifically, Sanchez was discovered in possession of methamphetamine in Jefferson County in April 2014.
Following a two day trial, a jury found Sanchez guilty of one count of “Conspiracy to Distribute Methamphetamine,” and one count of “Possession with Intent to Distribute Methamphetamine.” He faces up to 10 years in prison and a fine of up to $500,000 on each of the two counts. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorneys Paul Camilletti and Anna Krasinski, along with Special Assistant U.S. Attorney Lara Omps-Botteicher, also of the West Virginia Attorney General’s Office, prosecuted the case on behalf of the government. The West Virginia State Police and the Eastern Panhandle Drug and Violent Crime Task Force, a HIDTA-funded initiative, investigated.
Chief U.S. District Judge Gina M. Groh presided.
Grease Hauling Company and Executives Sentenced for Clean Water Act ViolationsRead the Press Release
Southern Grease Company, a grease hauling company that had been based in Dickson, Tennessee, was sentenced yesterday to pay a criminal fine of $280,000 and to forfeit an additional $113,500, announced David Rivera, United States Attorney for the Middle District of Tennessee. Southern Grease pleaded guilty in May 2015 to four felony violations arising from its illegal disposal of waste grease into municipal sewer systems. U.S. District Court Judge Aleta A. Trauger imposed this sentence and also ordered Southern Grease to make restitution to municipal authorities in Dickson and Clarksville, Tennessee.
Southern Grease, which contracted with restaurants and other customers in Tennessee and Kentucky to collect and dispose of the customers’ waste grease, illegally discharged waste grease into grease interceptors that were connected to the municipal sewer systems. This illegal dumping of grease caused substantial damage to municipal sewer systems by clogging pipes and interrupting the operation of pump stations. In December 2013 Southern Grease dumped waste grease into a grease interceptor in Clarksville, Tennessee, which resulted in the obstruction of pipes within the Clarksville sewer system and damage to a Clarksville pumping station, the operation of which was interrupted for cleaning and repairs.
Previously, on February 1, 2016, Judge Trauger sentenced George Butterworth, 75, of Dickson, Tenn., to serve two months in prison and one year of supervised release. Butterworth was President and an owner of Southern Grease, and had pleaded guilty to violating the Clean Water Act; conspiring to violate the Clean Water Act; and to making false statements to agents with the Environmental Protection Agency. Butterworth was also ordered to pay restitution to municipal authorities in Dickson and Clarksville.
On November 24, 2015, Judge Trauger sentenced Gerald McGee, 51, of Dickson, Tenn., to one month in prison plus two years of supervised release for his role in these offenses. McGee was the Operations Manager for Southern Grease and was also convicted of three felony violations in connection with the illegal dumping of waste grease. He was also ordered to pay restitution to municipal authorities in Dickson and Clarksville.
The case was investigated by the EPA Criminal Investigation Division, with assistance from the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorney William F. Abely.
Fruitland Woman Indicted for False Billing at Payette Dental ClinicRead the Press Release
BOISE – Cherie R. Dillon, 60, of Fruitland, Idaho, made an initial appearance yesterday on charges of health care fraud and aggravated identity theft, U.S. Attorney Wendy J. Olson announced. Dillon was indicted on February 9, 2016, by a federal grand jury in Boise.
The indictment alleges that Dillon was a dental hygienist and operated Dental Healthcare with Heart in Payette, Idaho. The indictment further alleges that between January 1, 2010, and December 31, 2013, she executed a scheme to defraud health care benefit programs, including Medicaid. In particular, the indictment alleges that even though Dillon was only a dental hygienist, she performed dental services that may only be performed by a dentist. Dillon received payment for those services from health care benefit programs while fraudulently misrepresenting that the services had been performed by a dentist, and while using the name and provider number of a particular dentist who was not in the office and who was unable to practice at the time.
The maximum sentence for health care fraud is up to ten years of imprisonment and a $250,000 fine. Aggravated identity theft carries a two year mandatory minimum prison sentence and up to a $250,000 fine.
A trial is set for April 18, 2016, before Chief U.S. District Judge B. Lynn Winmill at the federal courthouse in Boise.
“People who fraudulently perform and bill for dental procedures that only licensed dentists are authorized to perform threaten the well-being of vulnerable Medicaid patients and the taxpayers who fund this important program,” said Special Agent in Charge Steven J. Ryan of the U.S. Department of Health and Human Services Office of Inspector General. “Alongside our law enforcement partners, our agents will continue to aggressively pursue those who commit health care fraud just to enrich themselves.”
The case is being investigated by Health and Human Services Office of Inspector General with assistance from the Idaho Attorney General’s Medicaid Fraud Control Unit.
An indictment is a means of charging a person with criminal activity. It is not evidence. The person is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Fort Smith Man Appears in Court on Criminal Complaint for Defrauding Insurance CustomersRead the Press Release
Fort Smith, Arkansas - Kenneth Elser, Acting United States Attorney for the Western District of Arkansas, announced that Samuel Bowron Phillips, of Fort Smith, Arkansas, appeared today before United States Magistrate Judge Mark E. Ford for his initial appearance on a Criminal Complaint that charged Phillips with eleven counts of Mail Fraud, one count of Wire Fraud, and 3 counts of Money Laundering. The Criminal Complaint alleged that beginning in or about 2013 and continuing through and including November 2015, Phillips devised and executed a scheme to defraud customers of his insurance business by withdrawing funds from their annuity and insurance policies without their consent and knowledge, and used the money for his personal benefit and gain.
The charges in a criminal complaint are only allegations. A person is presumed innocent unless or until he or she is proven guilty beyond a reasonable doubt in a court of law.
This case is being investigated by the FBI, the IRS Criminal Investigative Division, the Postal Inspection Service, the Arkansas Department of Insurance, and the Fayetteville Police Department. Assistant United States Attorney Kyra Jenner is prosecuting the case for the United States.
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Former Tax Preparer Indicted for Defrauding the Government of Nearly $130,000Read the Press Release
Memphis, TN – A former tax preparer has been indicted for filing materially false federal income tax returns which defrauded the government of nearly $130,000. Edward L. Stanton III, U.S. Attorney for the Western District of Tennessee, and Tracey D. Montaño, Special Agent in Charge of IRS-Criminal Investigation, announced the indictment today.
According to the indictment, Latoya Garrett, 41, of Memphis, Tennessee, was employed as a tax preparer at the Bryan Tax Service, Global Taxes and Tax Bank. Garrett filed tax returns on behalf of the three aforementioned tax services for tax years 2010 and 2011.
An investigation conducted by the Internal Revenue Service – Criminal Investigation (IRS-CI) discovered that many of the returns filed by Garrett were materially false. Specifically, false Schedule C income and expenses, false education credits, and falsely claimed dependents were all claimed on the returns of 13 taxpayers — some of which had multiple returns — filed for tax years 2010 and 2011. The taxpayers denied providing the said information to Garrett; she was identified as the tax preparer that prepared and filed said returns with the IRS.
The total loss associated with Garrett’s illicit acts is $129,744.00.
On Wednesday, February 17, 2016, Garrett was indicted on 18 counts of aiding and assisting in filing false documents, claims or returns with IRS.
If convicted, she faces up to three years imprisonment on each count. She also faces a fine of up to $100,000 on each count.
This case is being investigated by the IRS-CI.
Assistant U.S. Attorney Damon K. Griffin is prosecuting this case on the government’s behalf.
The charges and allegations contained in the indictment are merely accusations, and the defendant is considered innocent unless and until proven guilty.
Former FDIC Attorney Sentenced Prison for Bank FraudRead the Press Release
ALEXANDRIA, Va. – Michelle M. Borzillo, 59, of Bristow, was sentenced today to 12 months and one day in prison, followed by two years of supervised release, for defrauding Wells Fargo Bank in connection with the sham short sale of her home to her live-in boyfriend. She was also ordered to pay $288,497 in restitution and to forfeit the proceeds of her offense.
Borzillo pleaded guilty on Nov. 17, 2015 to committing bank fraud. According to court documents, the defendant was a senior attorney at the Federal Deposit Insurance Corporation (FDIC) until September 2014. In 2007, she purchased a home in Nokesville for $850,000, with mortgages totaling $807,500 from Wells Fargo Bank. In 2013, she engineered the short sale of her Nokesville home to her boyfriend, who had been living with her at the property for several years.
In order to induce Wells Fargo Bank to approve the short sale and relieve the defendant of her mortgage obligations, the defendant falsely represented to her lender that the sale of the property was an arm’s-length transaction to someone with whom she had no close personal relationship. She also falsely certified that she was moving out of the property, and claimed she was suffering a financial hardship due to the then-federal pay freeze. In reality, as the defendant has admitted, she had no intention of moving out of the property, despite accepting $3,000 in relocation assistance in connection with a federal program designed to assist financially distressed short sellers. As a senior FDIC employee, the defendant also had not been subject to the federal pay freeze, and her base annual pay had steadily increased during the time she owned the home, to $230,000 at the time of the short sale. As a result of the fraudulent short sale transaction, Wells Fargo Bank was required to write off nearly $300,000 in losses.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Fred Gibson, Acting Inspector General of the FDIC; and Rene Febles, Deputy Inspector General for Investigations, Office of the Inspector General for the Federal Housing Finance Agency, made the announcement after sentencing by U.S. District Judge Claude M. Hilton. Assistant U.S. Attorneys Samantha P. Bateman and Paul J. Nathanson prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:15-cr-135.
Former Employees of Timeshare Consulting Firm Sentenced to Prison for Fraud ConspiracyRead the Press Release
CAMDEN, N.J. – Two former employees of The Vacation Ownership Group LLC were sentenced today to prison terms for conspiring to defraud owners of timeshare properties, U.S. Attorney Paul J. Fishman announced.
Alfred Giordano, a/k/a “Alex Jordan,” 36, of Belmar, New Jersey, was sentenced to 18 months in prison and Francis Santore, a/k/a “Frank Martin,” 56, of Northfield, New Jersey, was sentenced to 12 months in prison. Both defendants previously pleaded guilty before U.S. District Court Judge Noel L. Hillman to informations charging them with one count of conspiracy to commit mail and wire fraud and one count of mail fraud. Judge Hillman imposed the sentences today in Camden federal court.
According to documents filed in this case and statements made in court:
The Vacation Ownership Group, a/k/a VO Group LLC (VO Group), purported to offer consulting services to owners of timeshares, including timeshare cancellation services.
In January 2010, Giordano started working at the VO Group and was trained by Adam Lacerda to call customers using prepared scripts. Giordano would call customers and give them the false impression that he was working for a bank or lending institution and that he had the customer’s “complaint file” in front of him. After hearing Giordano’s false representations, some customers sent checks to the VO Group. Giordano admitted to causing over $120,000 in losses. Giordano also admitted to devising a separate scheme to defraud the New Jersey Department of Labor by collecting unemployment compensation benefits while working at the VO Group. Giordano admitted to applying for and collecting $13,676 in unemployment compensation benefits to which he was not entitled.
Santore started working at the VO Group in October 2010, where he was alleged trained by Lacerda to lie to customers using prepared scripts. Santore admitted that he would give customers the false impression that he was working for a bank or lending institution. He also admitted that he allowed customers to continue operating under the false impression given by his co-workers that the VO Group had the customer’s “complaint file” from a timeshare resort developer in front of them. Santore admitted that he regularly lied to customers in order to perpetrate the scam. Some of those customers then sent checks to the VO Group. Santore admitted that he falsely told a customer that if the customer paid $8,562 to the VO Group, the group would eliminate the customer’s approximately $18,000 mortgage debt with a timeshare developer. Santore admitted causing more than $70,000 in losses. Santore also devised a separate scheme to defraud the California unemployment system by collecting $16,200 in unemployment compensation benefits while working at the VO Group.
In addition to the prison terms, Judge Hillman sentenced both defendants to three years of supervised release. Restitution will be determined at a hearing to be scheduled.
U.S. Attorney Fishman credited special agents from the FBI’s Atlantic City Resident Agency, under the direction of Acting Special Agent in Charge Andrew Campi in Newark; and special agents from the Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, under the direction of Special Agent in Charge Cheryl Garcia, New York Region, for their roles in the investigation leading to these guilty pleas. He also thanked the N.J. Department of Labor, Benefit Payment Control Unit, for its assistance.
The government is represented by Assistant U.S. Attorney R. David Walk, Jr. of the U.S. Attorney’s Office Criminal Division in Camden.
Defense counsel:
Giordano: Martin I. Isenberg Esq., Gibbsboro, New Jersey
Santore: Robert A. Mintz Esq., Newark
Florida Man Sentenced to Eight Years in Prison for Investment Fraud ConspiracyRead the Press Release
SYRACUSE, NEW YORK –Burton Greenberg, 75, of Plantation, Florida was sentenced today in Federal Court in Fort Lauderdale, Florida after pleading guilty to a Northern District of New York indictment charging him with conspiracy to commit wire fraud, announced United States Attorney Richard S. Hartunian and FBI Special Agent In Charge Andrew W. Vale. Greenberg was sentenced to 97 months imprisonment, ordered to pay restitution in the amount of over $10 million and ordered to pay a forfeiture money judgment of over $10 million. He was also ordered to serve a three year term of supervised release following release from imprisonment.
Greenberg is President/CEO of M&P Global Financial Services, Incorporated, a Florida based corporation that entered into agreements in 2001 with Global Financial Fund 8, LLP, a company that solicited and received over $10 million from investors located throughout the United States, including residents of the Northern District of New York. As part of his guilty plea, Greenberg admitted that rather than investing the money in a secure investment as promised, he instead used the funds to make separate investments for himself. In an effort to avoid detection and allow him to continue to divert money for his own use, Greenberg helped orchestrate the payment of phony "profit" distributions to investors in 2004 and 2005 which were merely a partial return of their own principal investment. From 2004 to 2013 Greenberg repeatedly assured the investors via e-mail that their investments were secure and profitable when he knew that was not the case.
The case was investigated by the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorney Geoffrey Brown.