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19 February 2016
Florida Man Admits Making over $1.2 Million as Part of Three Year, Cross-County Insider Trading SchemeRead the Press Release
TRENTON, N.J. - A professional day trader today admitted personally making more than $1.2 million in illicit profits by repeatedly trading on inside information divulged to him in violation of confidentiality agreements, U.S. Attorney Paul J. Fishman announced.
Paul Petrello, 54, of Boca Raton, Florida, pleaded guilty before U.S. District Judge Michael A. Shipp in Trenton federal court to an information charging him with one count of conspiracy to commit securities fraud and one count of securities fraud.
According to documents filed in this case and statements made in court:
On numerous occasions between May 2010 and August 2013, Petrello and others, using inside information obtained by Petrello’s friend and business associate, Steven Fishoff, 58, of Westlake Village, and Fishoff’s employees, short sold securities of at least 13 public companies.
For each of these offerings, Fishoff or one or more of the day traders that he employed —including his friend, Ronald Chernin, 67, of Oak Park, California, and his brother-in-law, Steven Costantin, 55, of Farmingdale, New Jersey — entered into confidentiality or “wall-crossing” agreements as representatives of Fishoff’s trading entities, whereby they agreed not to disclose or trade on inside information concerning the offerings and were “brought over the wall” for the narrow purpose of determining whether to purchase the offered securities.
In breach of the wall-crossing agreements, Fishoff tipped Petrello about the confidentially marketed offerings by advising Petrello of the stock trading symbols of the companies, as well as the timing and sometimes the pricing of the upcoming offerings. Fishoff generally provided Petrullo with the inside information in code: first, text messaging Petrello only the first two letters of the company’s stock trading symbol; and second, calling Petrello and telling him the last two letters of the symbol.
In addition, Fishoff also directed Petrello to pass inside information related to the stock offerings to an individual identified as “CC-1” in the information. At other times, Fishoff directly tipped CC-1 about an upcoming offering.
At Fishoff’s recommendation, Petrello short sold the stock of the public companies in anticipation of a drop in the stocks’ price when the stock offerings were disclosed to the public. Petrello and his conspirators traded through the accounts of their respective trading entities or through related accounts that they controlled.
By trading on the nonpublic information, Petrello and his conspirators gained more than $3.9 million in profits over the course of the three-year scheme, with Petrello personally making more than $1.2 million. Petrello split his profits with Fishoff, generally on a 50-50 basis, as compensation for the inside information that Fishoff provided.
The conspiracy count to which Petrello pleaded guilty carries a maximum potential penalty of five years in prison and a $250,000 fine. The securities fraud count carries a maximum potential penalty of 20 years in prison and a $5 million fine. Sentencing is scheduled for May 25, 2016.
Fishoff has been indicted, and Chernin and Costantin have been charged by complaint for their own involvement in the insider trading scheme. The charges and allegations contained in the indictment and complaint are merely accusations, and defendants are presumed innocent unless and until proven guilty.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Acting Special Agent in Charge Andrew Campi in Newark, for the investigation leading to today’s guilty plea. He also thanked the U.S. Securities and Exchange Commission’s New York Regional Office under the direction of Sanjay Wadhwa.
The government is represented by Assistant U.S. Attorney’s Shirley U. Emehelu and Nicholas P. Grippo of the Criminal Division of the U.S. Attorney’s Office in Newark, as well as Acting Chief Barbara Ward and Assistant U.S. Attorney Sarah Devlin of the Office’s Asset Forfeiture and Money Laundering Unit.
Today’s plea is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.
Defense counsel: David M. Rosenfield Esq. and Howard R. Elisofon Esq., New York
Federal Judge Sentences to Prison Eight Men Involved in Drug Trafficking ConspiracyRead the Press Release
CHARLOTTE, N.C. – U.S. District Judge Robert J. Conrad, Jr. today sentenced eight men convicted of drug trafficking charges to prison terms ranging from 12 to 110 months, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina.
U.S. Attorney Rose is joined in making today’s announcement by John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division and Chief Kerr Putney, of the Charlotte-Mecklenburg Police Department (CMPD).
The nine defendants sentenced today are:
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Noel Rondell Alexander, a/k/a “Floyd,” 26, of Charlotte – sentenced to 16 months followed by 3 years of supervised release.
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Akanni Butler, a/k/a “KB,” 30, of Charlotte – sentenced to 110 months followed by 3 years of supervised release.
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Anthony Carter, a/k/a “Sanchez,” 27, of Charlotte – sentenced to 24 months followed by 3 years of supervised release.
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Isaac Hampton, a/k/a “Ike,” 27, of Charlotte – sentenced to 12 months followed by 3 years of supervised release.
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William Kee, III, 21, of Charlotte – sentenced to 24 months followed by 3 years of supervised release.
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Rodney Smith, a/k/a “Man,” 23, of Charlotte – sentenced to 33 months followed by 3 years of supervised release.
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Antonio Sullivan, a/k/a “Pooh,” 37, of Charlotte – sentenced to 52 months followed by 3 years of supervised release.
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Vincent Thompson, 33, of Charlotte – sentenced to 12 months followed by 3 years of supervised release.
According to today’s sentencing hearings and court documents filed in the case, from about May 2014 to February 2015, the defendants were involved in a drug trafficking conspiracy. Court records show that the defendants were all part of an open-air drug market that formed in, and operated around, the area of Beatties Ford Road and Catherine Simmons Avenue in Charlotte. According to court records, the defendants carried out their illegal drug trading mainly out of the parking lots for two small strip shopping centers on Beatties Ford Road or in several other locations on Catherine Simmons Avenue, which intersects with Beatties Ford Road. According to court records, the conspirators sold drugs, mostly “crack” cocaine, all hours of the day and night and frequently engaged in acts of violence, greatly impacting the residents and business owners in this community.
Over the course of today’s sentencing hearings, Judge Conrad noted that all of the residents of that community suffered as a result of these ongoing drug sales.
The investigation was handled by the FBI’s Safe Streets Task Force, of which CMPD is a partner member. The prosecution is being handled by Assistant U.S. Attorney Dana Washington of the U.S. Attorney’s Office in Charlotte.
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Federal Grand Jury Indicts Former Executive with Non-Profit that Provides Head Start Services in DallasRead the Press Release
DALLAS — A federal grand jury returned an indictment yesterday afternoon charging a former director in a non-profit corporation that receives grant funding to provide Head Start services for the Dallas area with embezzlement. U.S. Attorney John Parker of the Northern District of Texas made today’s announcement.
The one-count indictment charges Evetta Galloway Griffin, 48, of Grand Prairie, Texas, with one count of theft or bribery concerning programs receiving federal funds. Griffin is expected to surrender to federal authorities and make an initial appearance in federal court next week.
According to the indictment, Griffin, a/k/a Evette Griffin, was the Director of Facilities and Administration for the Child Care Group (CCG) until late March 2015. The CCG is a non-profit corporation that receives federal grant funding to provide, among other things, Head Start services to promote the school readiness of young children from low-income families in the Dallas area. Together, Head Start and Early Head Start programs support the comprehensive development of children from birth to age five, in centers, child care partner locations and in their own homes.
Griffin had many duties at CCG that were related to the operation of their child care centers, as well as other responsibilities related to the administration of the corporate office and the procurement process related to federal grants.
The indictment alleges that Griffin created and executed an embezzlement, theft and fraud scheme in which she fraudulently billed CCG for fictitious printing services allegedly provided by A-1 Express Co or A-1 Express Inc. In fact, between April 25, 2011 and January 30, 2015, Griffin submitted approximately 100 fraudulent invoices to CCG that they paid. Griffin usually converted the checks that were made payable to A-1 Express Co or A-1 Express Inc. to cash, ultimately receiving approximately $115,000 from her embezzlement scheme.
A federal indictment is an accusation by a grand jury and a defendant is entitled to the presumption of innocence unless proven guilty. If convicted, however, the maximum statutory penalty for this offense is 10 years in federal prison and a $250,000 fine. Restitution may also be ordered.
The U.S. Department of Health and Human Services Office of Inspector General is investigating the case. Criminal Chief Assistant U.S. Attorney Chad Meacham is in charge of the prosecution.
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Dubuque Couple Charged with Being Drug Users in Possession of a FirearmRead the Press Release
Willie Earl Horsley, 29, and Raven Javay Harris, 25, from Dubuque, Iowa, have each been charged with one count of being prohibited people in possession of a firearm and ammunition. The charges are contained in a Complaint filed on February 16, 2016, in United States District Court in Cedar Rapids.
The Complaint alleges that, on or about January 3, 2016, Horsley and Harris were in possession of a 45 caliber High Point semiautomatic handgun and .45 caliber ammunition. At the time that Horsley and Harris possessed the firearm and ammunition both were users of a controlled substance, specifically marijuana.
The Complaint alleges that on January 3, 2016, at approximately 11:43 p.m., police responded to the residence of Horsley and Harris in, after receiving a 911 call that a shooting had taken place. When police arrived, they discovered that a two-year old boy, J.H., had been shot in an upstairs bedroom. Horsley and Harris were present in the home downstairs.
The Complaint further alleges that later that evening, police obtained a warrant to search the residence. In addition to the firearms and ammunition seized during the execution of the warrant, police also seized from the kitchen a marijuana pipe, a marijuana grinder, and a marijuana bong. Police also seized a blue marijuana pipe from the bedroom shared by Horsley and Harris.
The Complaint also states that during the course of the investigation, both Horsley and Harris made statements to police. The night of the shooting, Horsley stated that he owned the .45 caliber firearm. Harris told police that the .45 caliber firearm belong to both her and Horsley. In subsequent interviews, Harris indicated that she uses marijuana whenever she gets overwhelmed, and had used at approximately 6:00 p.m. the day of the shooting. Horsley admitted to smoking marijuana occasionally, approximately two times per week, and that he had last used marijuana a few days prior to the shooting.
Allegations in the Complaint provide that during the course of the investigation, police obtained hair samples from Horsley and Harris in order to test for the presence of controlled substances. Both samples tested positive for the presence of marijuana.
If convicted, Horsley and Harris each face a possible maximum sentence of 10 years’ imprisonment, a $250,000 fine, $100 in special assessments, and three years of supervised release following any imprisonment.
“The possession of firearms and ammunition by those prohibited by law represents a serious danger to our communities,” said U.S. Attorney Techau. “Prosecuting those individuals who illegally keep firearms and ammunition is a priority of this office and an important part of keeping our communities safe.”
Horsley and Harris both appeared on February 17, 2016, in federal court in Cedar Rapids and were held in custody of the United States Marshals Service pending a detention hearing. Their next appearance for their detention hearings is set for February 23, 2016.
As with any criminal case, a charge is merely an accusation and a defendant is presumed innocent until and unless proven guilty.
This case was referred to the United States Attorney’s Office by local authorities and is being prosecuted by Assistant United States Attorney Lisa C. Williams. The case was investigated by the Dubuque Police Department and the Bureau of Alcohol Tabaco and Firearms.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 16-MJ-33
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District Man Sentenced to Seven Years in Prison for Robbing Man in Southeast WashingtonRead the Press Release
WASHINGTON – Donte Thomas, 25, of Washington, D.C., was sentenced today to seven years in prison for an armed robbery he committed last year in Southeast Washington, U.S. Attorney Channing D. Phillips announced.
Thomas was found guilty by a jury in November 2015 of charges of armed robbery and possession of a firearm during a crime of violence. The verdict followed a trial in the Superior Court of the District of Columbia. He was sentenced by the Honorable John McCabe. Following his prison term, Thomas will be placed on five years of supervised release.
According to the government’s evidence, the attack took place about 12:30 a.m. on May 13, 2015. The victim had just gotten off a bus at 18th Street and Alabama Avenue SE and was walking home from work. As he walked, he felt as if he was being watched. He then turned around and saw the defendant, a person he had known from childhood, standing behind him and pointing a handgun at him.
Thomas demanded, “Where the money at?” The victim dropped his backpack and laid face down on the ground. Thomas ordered the victim to give him his money and his diamond stud earrings. A second suspect then made the victim unlock his cell phone with his password. Thomas then approached the victim, pressed the muzzle of the gun against his head and instructed him not to move. The assailants then fled on foot.
The victim remained on the ground for a short period of time before getting up and going to his residence. Taken from him during the robbery were: his cellphone, stud earrings, LG headphones, a Bluetooth wireless headphone set, book bag, work clothes, $200 in tips from his job, and his keys. The victim reported the crime the next morning. Following his interview at the Seventh District Police Station, a detective drove the victim home. While they were en route, they saw the defendant walking. Once Thomas saw them, he took off running and a foot chase followed. Thomas ran into an occupied house and was found hiding in a closet. A single diamond stud earring was found in his back pocket and the victim’s cell phone was found in the closet where the defendant was sitting. No one else has been arrested in the case.
In announcing the sentence, U.S. Attorney Phillips commended the work of the officers and detectives from the Seventh District of the Metropolitan Police Department (MPD), who investigated the case. He also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialists Daphne Nelson and Gary Nails; Litigation Technology Specialist Joshua Ellen, and Assistant U.S. Attorney Sarah C. Santiago, who prosecuted the case.
Deschutes County Sheriff's Office Captain Indicted for Stealing $200,000Read the Press Release
EUGENE, Ore – A federal grand jury sitting in Eugene, Oregon has indicted a captain employed by the Deschutes County Sheriff’s Office. Scott Raymond Beard, 45, of Bend, Oregon, was charged with various offenses related to allegations that he used his position to embezzle and steal more than $200,000 in taxpayer funds. The indictment further alleges that Beard laundered some of the ill-gotten gains by conducting financial transactions to pay expenses on behalf of his co-defendant, Krista Jean Mudrick, 35, of Bend, Oregon. Mudrick is a former employee of the Deschutes County Sheriff’s Office and is charged with making false statements to the FBI and IRS about Beard’s expenditures of the ill-gotten gains.
Beard was arrested by FBI and IRS-Criminal Investigations today in Bend and is scheduled to make his initial appearance before U.S. Magistrate Judge Thomas Coffin in Eugene on Monday, February 22, 2016. Additionally, Mudrick has been issued a summons requiring her presence at an arraignment on Monday, February 22 in Eugene at 1:30.
Beard is charged with two counts of theft of funds from a federally funded program, which if convicted, carries a maximum penalty of ten years in prison; two counts of money laundering, which if convicted, carries a maximum penalty of ten years in prison; and, one count of passport fraud, which if convicted, carries a maximum penalty of five years in prison.
Mudrick is charged with one count of false statement to federal law enforcement agents, which if convicted, carries a maximum penalty of five years in prison.
“Most men and women in law enforcement dedicate their lives to public service and strive every day to always do the right thing as public servants,” said U.S. Attorney Billy J. Williams. “When an investigation shows that a member of law enforcement is violating the public trust by stealing the people's money, we will vigorously prosecute and seek justice for such conduct. Public trust in law enforcement is earned, and must be protected through accountability.”
“The public rightly expects that their law enforcement officers live and work by a strong set of core values – honesty, integrity and respect,” said Greg Bretzing, Special Agent in Charge of the FBI in Oregon. “The FBI will always aggressively pursue allegations of public corruption to ensure we maintain the public’s trust in law enforcement.”
“Throughout my career in federal law enforcement, I have gained a great deal of admiration for those that carry the badge and serve our communities and our nation, the vast majority of whom do so with fierce dedication, honor, and respect for the law. We take it personally when one of our own is alleged to have not lived up to the oath they made to uphold the law and the virtue of our profession,” stated Special Agent in Charge Teri Alexander of IRS Criminal Investigation.
An indictment is only an allegation of criminal activity. Defendants Beard and Mudrick are presumed innocent unless and until proven guilty beyond a reasonable doubt. A link to the indictment here.
This case was investigated by the FBI, IRS-Criminal Investigation, and the Deschutes County Sheriff’s Office. Assistant U.S. Attorney Christopher Cardani is prosecuting the case.
Biloxi Businessman Pleads Guilty in Kickback Scheme with MDOC CommissionerRead the Press Release
Gulfport, Miss - Robert Simmons, 60, a businessman from Biloxi, Mississippi, pled guilty today before U.S. District Judge Sul Ozerden to a Criminal Information charging him with carrying out a complicated kickback scheme in which he paid money to the commissioner of the Mississippi Department of Corrections (MDOC) and to a Harrison County Supervisor in exchange for lucrative contracts with the state and county, announced Acting U.S. Attorney Harold Brittain and FBI Special Agent in Charge Don Alway. Simmons will be sentenced on May 26, 2016 at 9:00 a.m., and faces a maximum penalty of ten years in prison and a $250,000 fine.
By virtue of Simmons’ relationship with the commissioner and supervisor and the kickbacks which he paid to both, he was successful in securing and keeping contracts with both governmental entities. Specifically, from 2012 through August 2014, Simmons was paid $4,000 a month as a consultant for Sentinel Offender Services, L.L.C. (Sentinel). Since 2012, Sentinel was under contract with the Mississippi Department of Corrections (MDOC) to provide services to aid in the monitoring and managing of offenders sentenced to probation or parole. Simmons deposited a portion of his monthly pay, a kickback of $1400, directly into the bank account of Christopher Epps, the Commissioner of the MDOC, at bank branch locations along the Mississippi Gulf Coast.
AJA Management and Technical Services (AJA) provided construction management services to the MDOC for the construction of the $40,000,000 expansion to the East Mississippi Correctional Facility and a $40,000,000 expansion to the Walnut Grove Youth Correctional Facility. Throughout the eighteen month period of construction, Simmons received a monthly consulting fee from AJA of $10,000. Every month, a portion of Simmons’ consulting fee was paid to the Commissioner of the MDOC.
From approximately 2005 through 2011, Health Assurance L.L.C. contracted with the Harrison County Jail to provide inmate medical services. The owner of Health Assurance L.L.C. paid Simmons a consulting fee which, at the end of the contract, was as high as $10,000 a month. Throughout this period of time, Simmons made payments in the amount of $2,000 a month to a Harrison County Supervisor for assistance provided in securing the contract at the Harrison County Jail for inmate medical services.
Throughout the relevant time period, the Commissioner of the MDOC exercised influence in the awarding of contracts with the MDOC. In return for these contracts and in order to secure future contracts and favors, Simmons began paying Commissioner Epps.
In summary, Simmons paid bribes and kickbacks to a Harrison county supervisor and to the commissioner of the Mississippi Department of Corrections, and both Harrison County and the Mississippi Department of Corrections received more than $10,000 during each one year period beginning in 2008 and continuing through 2014.
Acting U.S. Attorney in this case, Harold Brittain, praised the FBI agents for their work in identifying the conduct and ferreting out those individuals responsible for compromising the systems upon which taxpayers should be entitled to rely in ensuring that public funds are spent wisely. “Public officials soliciting and receiving bribes and kickbacks cannot be allowed to violate the public trust by participating in the expenditures of funds provided by taxpayers in support of government projects and contracts,” said Acting U.S. Attorney Brittain. “These projects must be awarded honestly and transparently.”
“Public Corruption investigations like these are a top priority for the FBI because those who would betray the public’s trust and confidence for self-gain undermine the very fabric of our democracy,” said Don Alway, Special Agent in Charge of the FBI’s Jackson Division.Ashland Man Sentenced to 2 Years Federal Prison for Money Laundering Profits from Marijuana SalesRead the Press Release
MEDFORD, Ore. - On Wednesday, February 17, 2016, U.S. District Judge Ann Aiken sentenced Jonathan Robert Quaccia, 35, originally of Ashland, Oregon, to two years in federal prison for conspiracy to commit money laundering. The Court ordered the defendant to serve three years of supervised release upon his release from prison term and complete 500 hours of community service.
From 2012 to December 2014, defendant shipped marijuana from California to New York and Georgia for sale. Deposits of the proceeds from the marijuana sales were made in New York and Georgia into bank accounts held by Southern Oregon residents. The Oregon residents were recruited by Quaccia and co-defendant Matthew Correa. Those individuals then withdrew the marijuana proceeds from the Oregon bank accounts and gave the money to Correa, who delivered the money to Quaccia in California. This scheme was designed to promote the manufacture and distribution of marijuana and to conceal the nature, source and ownership of the marijuana proceeds. The amounts deposited and withdrawn were kept under $10,000 to avoid detection. Bank records show $2.2 million in marijuana proceeds were deposited in New York and Georgia, and $2,075,000 withdrawn in Oregon in at least 262 transactions.
Quaccia was residing in McKinleyville, CA, during the time of the offense. He has no previous criminal history.
This case was investigated jointly by the U.S. Drug Enforcement Administration and the Humboldt County Drug Task Force, and was prosecuted by Assistant U.S. Attorney Douglas W. Fong.
Adventist to Pay More Than $2 Million to Resolve False Claims AllegationsRead the Press Release
Tampa, FL – United States Attorney A. Lee Bentley, III announces that Adventist Health System Sunbelt Healthcare Corporation (Adventist) has agreed to pay the government $2.09 million to resolve allegations that patients were administered portions of single-dose vials of chemotherapy drugs that were left over from administrations to prior patients.
Subject to a very few strict exceptions not applicable here, these single-dose vials of chemotherapy drugs can only be accessed once and their contents (whether some or all) can only be administered to one patient. That is because these single-dose vials lack any anti-microbial ingredients or other preservatives, and accessing them can introduce harmful agents that can be passed on to subseqent patients.
This settlement also resolves allegations that some platinum based drugs were administered inappropriately; that certain infusion services were upcoded; and that some patients had to be admitted for treatment as a result of the foregoing acts and omissions.
These events occurred between late 2007 and mid-2011, at an Adventist location in Central Florida, and resulted in the submission of improper claims to federal government health care programs, including Medicare, TRICARE, and the Federal Employees Health Benefits Program. In January 2012, Adventist voluntarily self-disclosed certain of the above-described conduct to the United States and repaid $819,828.82 to the United States. The company will receive a credit of that amount toward the $2.09 million obligation.
“Beneficiaries of federal health care plans, particularly those undergoing chemotherapy treatment for cancer, should not be treated with drugs that present unnecessary and avoidable risks,” stated U.S. Attorney Bentley. “When a lack of proper oversight permits circumstances like this to occur, resulting in the submission of false healthcare claims, responsible providers will be held accountable.”
"These actions put patients at needless risk in an attempt to boost profits at taxpayer expense," said Shimon R. Richmond, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services. "This settlement demonstrates that such practices have consequences."
The settlement resolves allegations in a lawsuit filed by relator Heather Huddleston in February 2013. Huddleston’s suit was filed under the whistleblower provisions of the False Claims Act, which authorizes private parties to sue for false claims on behalf of the United States and to share in any recovery. Huddleston was formerly employed by Adventist and had disclosed certain of the conduct internally to Adventist in 2011. The relator will be receiving $376,452 from the proceeds of the settlement.
This case was investigated jointly by Assistant U.S. Attorney Charles Harden of the United States Attorney’s Office for the Middle District of Florida; Trial Attorney Tom Morris of the Commercial Litigation Branch of the Justice Department’s Civil Division; the U.S. Department of Health and Human Services - Office of Inspector General; and the Federal Bureau of Investigation.
The lawsuit was filed in the Middle District of Florida, and is captioned United States ex rel. Huddleston v. Adventist Health System Sunbelt Healthcare Corporation, Case No. 8:13-cv-710-T-27-EAJ (M.D. Fla.).
The claims resolved by the settlement are allegations only; there has been no determination of liability.
21st Annual Federal Courthouse African-American History Month Program – February 25, 2016Read the Press Release
BATON ROUGE, LA – Chief Judge Brian A. Jackson, Judge Shelly D. Dick, Judge John W. deGravelles, and Judge James J. Brady of the United States District Court for the Middle District of Louisiana and the agencies of the federal courthouse will host the Twenty-First Annual Federal Courthouse African-American History Month Program at 1:00 p.m. on Thursday, February 25, 2016, in Courtroom 1, located on the third floor of the federal courthouse.
The featured guest speaker will be Clarence A. Becknell, member and Historian of the Zulu Social Aid and Pleasure Club, Inc., of New Orleans, Louisiana. Mr. Becknell will share the interesting story of the Zulu’s origin and its rise to prominence as a highly recognizable part of Louisiana’s cultural landscape.
Musical entertainment will be provided by Mr. John Gray, local trumpeter, and Mr. Michael Foster, of the “Michael Foster Project.”
Members of the public and the press are invited to attend. For further information, please contact Michael J. Jefferson, Assistant United States Attorney, at (225) 389-0443.
18 February 2016
Wynne Man Sentenced to 30 Years for Sexual Exploitation of A MinorRead the Press Release
LITTLE ROCK—Christopher R. Thyer, United States Attorney for the Eastern District of Arkansas, along with Raymond R. Parmer, Jr., Special Agent in Charge of the Homeland Security Investigations (HSI) New Orleans Field Division, announced today that Joshua Logan Thornton, age 32, of Wynne, was sentenced to 360 months or 30 years in federal prison for Sexual Exploitation of a Minor.
Thursday’s sentencing was before United States District Judge Billy Roy Wilson, and comes following Thornton’s guilty plea on November 24, 2015. Thornton was indicted on October 7, 2015, in a three-count Indictment charging him with sexual exploitation of a minor, distribution of child pornography, and possession of child pornography.
"The internet continues to be the weapon of choice for individuals who exploit children for their own gratification," Thyer said. "Because of this our office reiterates the importance of adults keeping an open line of communication with children in an effort to prevent and detect crimes such as this. A sentence of 30 years sends a strong message that these heinous acts will not be tolerated and will be prosecuted."
On July 24, 2015, Arthur Clements was arrested for possession of child pornography by HSI Baltimore agents. During an interview Clements admitted that he shared child pornography through an internet streaming program with a person named "John," who performed sexually explicit acts with a minor live on the internet streaming program. "John" was later identified as Joseph Thornton of Wynne, Arkansas.
Through forensic analysis of Clements’s computer, law enforcement recovered multiple videos sent to Clements by Thornton. Upon reviewing the videos, law enforcement officers observed a distinctive quilt with yellow and orange butterflies on a turquoise background was present in three videos. The three videos depicted Thornton performing sexually explicit acts on the minor.
On August 6, 2015, HSI agents executed a search warrant at Thornton’s residence in Wynne. Agents seized a number of electronic devices, as well as the butterfly quilt located in the videos.
The minor female admitted that Thornton performed sex acts on her and instructed her not to tell anyone about it.
Thornton provided a full confession. Thornton admitted that he touched the minor sexually with his hands and his penis and that he would do this on live streaming internet. Thornton admitted that the abuse of the minor began eight months prior and stopped the month he learned news that Jared Fogle, the Subway pitchman, was arrested on child pornography charges. Thornton admitted that he shared the images of him and the minor with at least two people on the internet.
HSI agents also forensically examined the computer seized from Thornton’s home and observed approximately 5,000 images of child pornography, including multiple images and videos of the minor.
"Individuals who produce child pornography are directly responsible for what is, in plain language, the rape of children. Production of child pornography steals the innocence of children and destroys lives," HSI New Orleans Special Agent in Charge Raymond R. Parmer Jr. said. "Criminals who prey on children will continue to be one of the agency’s highest priorities in order to protect the innocent from these terrible crimes."
There is no parole in the federal system. When Thornton is released upon completion of his 30 year sentence, he will serve five years of supervised release. Conditions of his supervised release include registering as a sex offender and no contact with minors.
HIS led the investigation. Assistant United States Attorney Kristin H. Bryant prosecuted the case for the United States.
Waterloo Man Charged with Receipt and Possession of Child PornographyRead the Press Release
Forrest Rindels, age 60, of Waterloo, Iowa, has been charged with one count of receipt of child pornography and three counts of possession of child pornography. The charges are contained in an Indictment unsealed on February 8, 2016, in United States District Court in Cedar Rapids.
The Indictment alleges that, between 2001 and 2015, Rindels received child pornography and possessed it on a computer and two external storage devices.
If convicted, Rindels faces a mandatory minimum sentence of five years’ imprisonment and a possible maximum sentence of eighty years’ imprisonment, a $1,000,000 fine, a $400 special assessment, and at least five years and up to life on supervised release following any imprisonment.
Rindels appeared for a detention hearing on February 17, 2016, in federal court in Cedar Rapids and was released on bond. Rindels’ next appearance for trial is set for April 11, 2016.
As with any criminal case, a charge is merely an accusation and a defendant is presumed innocent until and unless proven guilty.
This case is being prosecuted by Assistant United States Attorney Mark Tremmel and was investigated by the Iowa Division of Criminal Investigation, the Waterloo Police Department, and the Cedar Rapids Police Department.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is CR 16-2006.
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Wasilla man charged with possession of stolen guns, stolen mail, and fraudRead the Press Release
Anchorage, Alaska – Acting U.S. Attorney Kevin R. Feldis announced today that a Wasilla man was indicted by a federal grand jury in Anchorage for possession of stolen firearms, being a felon in possession of a firearm, possession of stolen mail, possession and use of access devices obtained from the stolen mail, fraud, and Aggravated Identity Theft.
Timothy Wayne Taylor, a door to door meat salesman, age 36, of Wasilla, Alaska, was charged in a six-count indictment.
The indictment alleges that between Feb. 24, 2015, through March 11, 2015, Taylor was in possession of 24 stolen firearms and also charges Taylor with being a felon in possession of firearms. From May 2014 until March 11, 2015, Taylor was in possession of approximately 1600 pieces of stolen mail addressed to approximately 800 individuals and businesses from the Wasilla, Palmer, Houston, and Chugiak, Alaska, areas. Debit cards, credit cards, credit card checks, PIN numbers and other access devices were found in Taylor’s possession. The indictment also alleges that Taylor fraudulently negotiated stolen credit card checks and stolen bank checks from the stolen mail at a local business, obtaining more than $6000. As a result of those transactions, Taylor was also charged with Aggravated Identity Theft.
Mr. Feldis commended the United States Postal Inspection Service, the Alaska State Troopers, and the Bureau of Alcohol, Tobacco, Firearms and Explosives, for the investigation of this case.
"Postal Inspectors worked closely with the U.S. Attorney's Office and the Alaska State Troopers," said Seattle Division Inspector in Charge Anthony Galetti of the U.S. Postal Inspection Service. "We take mail theft and subsequent use of stolen mail to commit identity theft very seriously and will continue to vigorously protect the U.S. Mail."
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.
VimpelCom Limited and Unitel LLC Enter into Global Foreign Bribery Resolution of More Than $795 Million; United States Seeks $850 Million Forfeiture in Corrupt Proceeds of Bribery SchemeRead the Press Release
Amsterdam-based VimpelCom Limited, the world’s sixth-largest telecommunications company and an issuer of publicly traded securities in the United States, and its wholly owned Uzbek subsidiary, Unitel LLC, entered into resolutions with the Department of Justice today in which they admitted to a conspiracy to make more than $114 million in bribery payments to a government official in Uzbekistan between 2006 and 2012 to enable them to enter and continue operating in the Uzbek telecommunications market.
In a related action, the department also filed a civil complaint today seeking the forfeiture of more than $550 million held in Swiss bank accounts, which constitute bribe payments made by VimpelCom and two separate telecommunications companies, or funds involved in the laundering of those payments, to the Uzbek official. The forfeiture complaint follows an earlier civil complaint filed on June 29, 2015, which seeks forfeiture of more than $300 million in bank and investment accounts held in Belgium, Luxembourg and Ireland that also constitute funds traceable to bribes, or funds involved in the laundering of the bribes, paid by VimpelCom and another telecommunications company to the same Uzbek official.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Preet Bharara of the Southern District of New York, Chief Richard Weber of Internal Revenue Service-Criminal Investigation (IRS-CI) and Special Agent in Charge Clark E. Settles of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI) Washington, D.C., Field Office.
“These cases combine a landmark FCPA resolution for corporate bribery with one of the largest forfeiture actions we have ever brought to recover bribe proceeds from a corrupt government official,” said Assistant Attorney General Caldwell. “The Criminal Division’s FCPA enforcement program and our Kleptocracy Initiative are two sides of the same anti-corruption coin. The FCPA resolution in this case is also one of the most significant coordinated international and multi-agency resolutions in the history of the FCPA, and demonstrates our commitment both to pursuing justice and to bringing about corporate reform.”
“Today we mark the resolution of criminal charges and civil proceedings against corrupt corporate entities that made bribery a foundation of their business model,” said U.S. Attorney Bharara. “As they have admitted in court filings, VimpelCom, the world’s sixth largest telecommunications company, with securities traded in New York, and its subsidiary, Unitel, built their business in Uzbekistan on over $114 million in bribes funneled to a government official. Those payments, falsely recorded in the company’s books and records, were then laundered through bank accounts and assets around the world, including through accounts in New York.”
“Today’s admission of guilt by VimpelCom and Unitel to paying bribes to government officials is a victory for all who fight corruption at all levels,” said Chief Weber. “It also demonstrates the skill and tenacity of IRS Criminal Investigation special agents when it comes to delving underneath layers of financial transactions designed to conceal illegal payments for gain. The global economy demands a level playing field for all. When certain VimpelCom and Unitel executives chose to use deception in order to continue this scheme and take advantage of insider knowledge, they also chose to become criminals. IRS-CI pledges to continue our efforts on the international stage to stop corrupt financial schemes such as this one.”
“HSI special agents and our law enforcement partners will continue to investigate financial crimes committed by corrupt foreign officials,” said Special Agent in Charge Settles. “We will not permit ill-gotten gains to be laundered through U.S. financial markets.”
The Criminal Resolution
In the criminal case, Unitel pleaded guilty and was sentenced to a one-count criminal information filed today in the Southern District of New York and assigned to U.S. District Judge Edgardo Ramos of the Southern District of New York, charging the company with a conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act (FCPA).
VimpelCom entered into a deferred prosecution agreement in connection with a criminal information charging the company with conspiracy to violate the anti-bribery and books and records provisions of the FCPA, and a separate count of violating the internal controls provisions of the FCPA. Pursuant to its agreement with the department, VimpelCom agreed to pay a total criminal penalty of $230,326,398.40 to the United States, including $40 million in forfeiture. VimpelCom also agreed to implement rigorous internal controls, retain a compliance monitor for a term of three years and cooperate fully with the department’s ongoing investigation, including its investigation of individuals.
In related proceedings, VimpelCom settled with the U.S. Securities and Exchange Commission (SEC) and the Public Prosecution Service of the Netherlands (Openbaar Ministrie, or OM). Under the terms of its resolution with the SEC, VimpelCom agreed to a total of $375 million in disgorgement of profits and prejudgment interest, to be divided between the SEC and OM. VimpelCom agreed to pay the OM a criminal penalty of $230 million, for a total criminal penalty of $460,326,398.40, and a total resolution amount of more than $835 million. The department agreed to credit the criminal penalty paid to the OM as part of its agreement with the company. The SEC agreed to credit the forfeiture paid to the department as part of its agreement with the company. Thus, the combined total amount of U.S. and Dutch criminal and regulatory penalties paid by VimpelCom will be $795,326,398.40, making it one of the largest global foreign bribery resolutions ever.
According to the companies’ admissions, VimpelCom and Unitel, through various executives and employees, paid bribes to an Uzbek government official, who was a close relative of a high-ranking government official and had influence over the Uzbek governmental body that regulated the telecom industry. The companies structured and concealed the bribes through various payments to a shell company that certain VimpelCom and Unitel management knew was beneficially owned by the foreign official. The bribes were paid on multiple occasions between approximately 2006 and 2012 so that VimpelCom could enter the Uzbek market and Unitel could gain valuable telecom assets and continue operating in Uzbekistan. VimpelCom and Unitel contemplated additional bribes in 2013, but those bribes were not completed before VimpelCom opened an internal investigation.
In addition, VimpelCom admitted that it falsified its books and records and attempted to conceal and disguise the bribery scheme by classifying payments as equity transactions, consulting and repudiation agreements and reseller transactions. VimpelCom also failed to implement and enforce adequate internal accounting controls, which allowed the bribe payments to occur without detection or remediation. Moreover, when the board of directors sought an FCPA legal opinion assessing corruption risks involved in the transactions, certain VimpelCom management withheld crucial information from outside counsel performing the review that restricted the scope of FCPA opinions, rendering them worthless. Rather than implement and enforce a strong anti-corruption ethic, certain VimpelCom executives sought ways to give the company plausible deniability of illegality while knowingly proceeding with corrupt business transactions.
A number of significant factors contributed to the department’s criminal resolution with the companies. Among these, the companies received significant credit for their prompt acknowledgement of wrongdoing after being informed of the department’s investigation, for their willingness to promptly resolve their criminal liability on an expedited basis and for their extensive cooperation with the department’s investigation. Specifically, the criminal penalty reflects a 45 percent reduction off of the bottom of the U.S. Sentencing Guidelines fine range. However, the companies did not receive more significant mitigation credit, either in the penalty or the form of resolution, because the companies did not voluntarily self-disclose their misconduct to the department after an internal investigation uncovered wrongdoing.
The Forfeiture Complaints
The department has also filed two civil complaints seeking a total of $850 million in forfeiture. A complaint filed today seeks forfeiture of approximately $550 million in proceeds of illegal bribes paid, or property involved in the laundering of those payments, to the Uzbek official by VimpelCom and two other telecommunications companies operating in Uzbekistan. The $550 million is currently located in Swiss bank accounts. The department also filed a prior complaint seeking forfeiture of an additional $300 million in proceeds of illegal bribes paid, or property involved in the laundering of those payments, to the same Uzbek official. The assets sought to be forfeited in that complaint are restrained in Belgium, Luxembourg and Ireland. In that case, on Jan. 11, 2016, the U.S. District Court for the Southern District of New York entered a partial default judgment against all potential claimants other than the Republic of Uzbekistan.
As alleged in the complaints and as is part of the criminal resolutions announced today, the telecom companies paid a total of more than $800 million in bribes so that the Uzbek official would assist VimpelCom and other telecommunications companies in obtaining and retaining business in Uzbekistan. Thereafter, the official’s associates laundered the corruption proceeds through accounts held in Latvia, the United Kingdom, Hong Kong, Ireland, Belgium, Luxembourg and Switzerland. The illicit funds were transmitted through financial institutions in the United States before they were deposited into accounts in these countries, thereby subjecting them to U.S. jurisdiction.
The department brought these forfeiture actions under the Kleptocracy Asset Recovery Initiative in the Criminal Division’s Asset Forfeiture and Money Laundering Section (AFMLS), working in partnership with federal law enforcement agencies to forfeit the proceeds of foreign official corruption and, where appropriate, to use those recovered assets to benefit the people harmed by corruption and abuse of office.
* * *
These cases represent the department’s commitment to both prosecute those who pay bribes and to ensure that the corrupt government officials who receive the bribes cannot use the U.S. financial system to launder their illicit gains. The IRS-CI and ICE-HSI are investigating the cases, along with the IRS Global Illicit Financial Team in Washington, D.C. Senior Litigation Counsel Nicola J. Mrazek and Trial Attorney Ephraim Wernick of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Edward Imperatore of the Southern District of New York are prosecuting the criminal case, with substantial assistance from AFMLS. AFMLS Trial Attorney Marie M. Dalton is prosecuting the forfeiture case with substantial assistance from the Fraud Section.
Law enforcement colleagues within the OM, the Swedish Prosecution Authority, the Office of the Attorney General in Switzerland and the Corruption Prevention and Combating Bureau in Latvia provided significant cooperation and assistance in this matter. Law enforcement colleagues in Belgium, France, Ireland, Luxembourg and the United Kingdom have also provided valuable assistance. The Criminal Division’s Office of International Affairs provided significant assistance in this matter. The SEC referred the matter to the department and provided extensive cooperation and assistance.
Individuals with information about possible proceeds of foreign corruption located in or laundered through the United States should contact federal law enforcement or send an email to [email protected].
Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.
U.S. Attorney's Office Settles Americans with Disabilities Act Case with 360 Federal Credit UnionRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that the U.S. Attorney’s Office has reached a settlement with 360 Federal Credit Union to ensure equal access for individuals with disabilities at all 360 Federal Credit Union locations, pursuant to the Americans with Disabilities Act (“ADA”).
The agreement resolves an ADA complaint filed by an individual who is hard of hearing who alleged that 360 Federal Credit Union would not accept his video relay calls. Since the commencement of the investigation, 360 Federal Credit Union has worked cooperatively to develop and amend its policies and practices to comply with the ADA and the Department of Justice’s implementing regulations.
“Individuals who have disabilities must not be denied equal access to the services offered by financial institutions simply because of their disability,” said U.S. Attorney Daly. “360 Federal Credit Union’s cooperation during this investigation has shown that it is committed to equal access and effective communication with its customers who have disabilities.”
Under the agreement, 360 Federal Credit Union will pay a small monetary sum to compensate the individual for the expenses he incurred as a result of the credit union’s failure to accept his video relay calls. The agreement also requires 360 Federal Credit Union to accept video relay calls in all of its credit union locations and amend its policies, practices, and training to ensure the removal of barriers to access at its branch offices.
Title III of the ADA prohibits discrimination against individuals with disabilities by businesses that serve the public. Among other things, the ADA requires financial institutions, accountants, lawyers, doctors and other businesses to provide auxiliary aids and services that are necessary for effective communication. For individuals who are deaf or hard of hearing, auxiliary aids include qualified sign language or oral interpreters, use of relay services, computer-assisted real time transcription, and, for simple communications, the exchange of written notes.
Individuals who believe that they may have been victims of discrimination can file a complaint with the U.S. Attorney’s Office at 203-821-3700. More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt. Additional information about the ADA can be found at www.ada.gov, or by calling the Department’s toll-free information line at (800) 514-0301 and (800) 514-0383 (TDD).
This matter was handled by Assistant U.S. Attorney Ndidi N. Moses with the assistance of the Disability Rights Section of the U.S. Department of Justice Civil Rights Division.
Two New Jersey Women Admit Roles in Plots to Bribe Corrections Officers to Smuggle Contraband into Essex County JailRead the Press Release
TRENTON, N.J. – Two women today admitted their involvement in schemes to bribe corrections officers to smuggle contraband to inmates inside the Essex County Jail, a federal pretrial detention facility, U.S. Attorney Paul J. Fishman announced.
Deidra Harrison, 51, of Newark, New Jersey, pleaded guilty before U.S. District Judge Mary L. Cooper to Count One of an indictment charging her with conspiring to commit extortion under color of official right. Karen Adrianzen, 38, of North Bergen, New Jersey, pleaded guilty before U.S. District Judge Mary L. Cooper to an information charging her with conspiring to pay bribes to Essex County Jail corrections officers. Harrison and Adrianzen have both been released on bail.
According to the documents filed in this case, other cases, and statements made in court:
In November 2013, Channel Lespinasse, 32, of Florham Park, New Jersey, a corrections officer at the Essex County Jail and Harrison’s daughter, agreed to deliver a cell phone to an inmate inside the Essex County Jail in exchange for $1,000. Harrison retrieved the cell phone and the $1,000 payment from an FBI undercover agent outside of the jail and passed the cell phone and the cash payment along to Lespinasse. Lespinasse then smuggled the cell phone into the jail and delivered it to the inmate.
On multiple occasions between September 2013 and May 2014, Jason Perez, 40, of Guttenberg, New Jersey, a federal pretrial detainee at the Essex County Jail, directed Adrianzen to pay cash bribes to various Essex County Jail corrections officers. At Perez’s direction, Adrianzen obtained contraband, including marijuana and cell phones, and delivered them to the corrections officers along with the cash bribes. After the corrections officers delivered the contraband to Perez, he ultimately sold the marijuana and cell phones to other inmates in the jail, who paid for the contraband via Western Union money transfers executed by their friends and family. Adrianzen and others collected the money transfers on Perez’s behalf.
The charge for conspiring to commit extortion under color of official right, to which Harrison pleaded guilty, carries a maximum penalty of 20 years in prison and a $250,000 fine. The charge of conspiring to bribe public officials, to which Adrianzen pleaded guilty, carries a maximum potential penalty of five years in prison and a $250,000 fine. Sentencing for Harrison and Adrianzen is scheduled for June 3, 2016 and May 31, 2016, respectively.
On Jan. 13, 2015, Lespinasse pleaded guilty to conspiring to commit extortion under color of official right and awaits sentencing on April 20, 2016. Perez pleaded guilty to conspiring to pay bribes to public officials on May 4, 2015 and awaits sentencing on March 1, 2016.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Acting Special Agent in Charge Andrew Campi in Newark, and investigators with the Internal Affairs Division of Essex County Jail, under the leadership of Warden Roy Hendricks, with the investigation leading to today’s pleas.
The government is represented by Assistant U.S. Attorneys Rahul Agarwal of the U.S. Attorney’s Office Special Prosecutions Division and Rob Frazer of the Organized Crime/Gangs Unit in Newark.
Defense counsel:
Harrison: Frank Guzman, Jersey City, New Jersey
Two Former Arkansas Officials Sentenced for Bribery SchemeRead the Press Release
A former deputy director of the Arkansas Department of Human Services (ADHS), a multibillion-dollar state agency, and a former probation officer in Crittenden County, Arkansas, and West Memphis, Arkansas, councilmember were sentenced today in Little Rock, Arkansas, for engaging in a bribery scheme involving the owner of two mental health companies, announced Assistant Attorney General Leslie R. Caldwell of the Department of Justice’s Criminal Division and First Assistant U.S. Attorney Patrick C. Harris of the Eastern District of Arkansas.
Steven B. Jones, 51, of Marion, Arkansas, the former deputy director of ADHS, was sentenced to 30 months for conspiracy to commit bribery concerning programs receiving federal funds and honest services wire fraud and for federal funds bribery. Co-conspirator Phillip W. Carter, 47, also of Marion, was sentenced to 24 months for conspiracy to commit bribery concerning programs receiving federal funds and honest services wire fraud.
According to the plea agreements, Carter and a local pastor served as intermediaries in a bribery scheme involving Jones and Theodore Suhl, the owner of two businesses that provided inpatient and outpatient mental health services to juveniles. Jones admitted that, beginning in April 2007 and while serving as ADHS deputy director, he solicited and accepted multiple cash payments and other things of value from Suhl. Suhl provided the cash payments and other things of value to Jones through Carter and the pastor, and in return, Jones admitted that he agreed to perform official acts that benefitted Suhl and his businesses.
As part of their pleas, both Jones and Carter admitted that they and other members of the conspiracy concealed their activity and dealings by, among other things, holding periodic meetings at restaurants in Memphis, Tennessee, or in rural Arkansas where they would not be easily recognized; funneling the cash payments through the pastor’s church; providing the bribe payments to Jones in cash so that the transactions would not be easily traceable; and speaking in code during phone conversations.
On Dec. 2, 2015, Suhl was indicted on one count of conspiracy to commit bribery and honest services fraud, three counts of honest services fraud, one count federal funds bribery and one count of interstate travel in aid of bribery and is awaiting trial. The charges and allegations contained in that indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
The FBI’s Little Rock Field Office investigated both cases. Assistant U.S. Attorney Angela S. Jegley of the U.S. Attorney’s Office for the Eastern District of Arkansas and Trial Attorney Edward P. Sullivan of the Criminal Division’s Public Integrity Section prosecuted Jones’s case. Trial Attorneys Edward P. Sullivan, Lauren Bell and Gwendolyn A. Stamper of the Criminal Division’s Public Integrity Section prosecuted Carter’s case.
Two Former Arkansas Officials Sentenced to Prison for Bribery SchemeRead the Press Release
LITTLE ROCK—Steven B. Jones, a former deputy director of the Arkansas Department of Human Services (ADHS), a multi-billion dollar state agency, and Phillip W. Carter, a former probation officer in Crittenden County, Arkansas, and West Memphis, Arkansas, councilmember were sentenced today for engaging in a bribery scheme involving the owner of two mental health companies, announced Assistant Attorney General Leslie R. Caldwell of the Department of Justice’s Criminal Division and First Assistant U.S. Attorney Patrick C. Harris of the Eastern District of Arkansas.
On Thursday, United States District Judge Billy Roy Wilson sentenced Jones, 51, of Marion, Arkansas, to 30 months in the Bureau of Prisons after pleading guilty to a two-count Information charging him with conspiracy to commit bribery concerning programs receiving federal funds and honest services wire fraud and for federal funds bribery. Jones also must serve one year of supervised release and pay a $6,000 fine. Co-conspirator Carter, 47, also of Marion, was sentenced to 24 months in prison and two years of supervised release for conspiracy to commit bribery concerning programs receiving federal funds and honest services wire fraud.
According to the plea agreements, Carter and a local pastor served as intermediaries in a bribery scheme involving Jones and Theodore Suhl, the owner of two businesses that provided inpatient and outpatient mental health services to juveniles. Jones admitted that, beginning in April 2007 and while serving as ADHS deputy director, he solicited and accepted multiple cash payments and other things of value from Suhl. Suhl provided the cash payments and other things of value to Jones through Carter and the pastor, and in return, Jones admitted that he agreed to perform official acts that benefitted Suhl and his businesses.
As part of their pleas, both Jones and Carter admitted that they and other members of the conspiracy concealed their activity and dealings by, among other things, holding periodic meetings at restaurants in Memphis, Tennessee, or in rural Arkansas where they would not be easily recognized; funneling the cash payments through the pastor’s church; providing the bribe payments to Jones in cash so that the transactions would not be easily traceable; and speaking in code during telephone conversations.
On Dec. 2, 2015, Suhl was indicted on one count of conspiracy to commit bribery and honest services fraud, three counts of honest services fraud, one count federal funds bribery and one count of interstate travel in aid of bribery and is awaiting trial. The charges and allegations contained in that indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
The FBI’s Little Rock Field Office investigated both cases. Assistant U.S. Attorney Angela S. Jegley of the U.S. Attorney’s Office for the Eastern District of Arkansas and Trial Attorney Edward P. Sullivan of the Criminal Division’s Public Integrity Section prosecuted Jones’s case. Trial Attorneys Edward P. Sullivan, Lauren Bell and Gwendolyn A. Stamper of the Criminal Division’s Public Integrity Section prosecuted Carter’s case.
Two Convicted for Fraudulently Obtaining over $50,000 in Federal Housing Assistance FundsRead the Press Release
BATON ROUGE, LA - United States Attorney Walt Green announced the convictions of RHODA RENAE ROBERTSON, age 47, and LOUELLA ROBERTSON, age 68, both of Baton Rouge, Louisiana, who pled guilty before U.S. District Judges Shelley Dick and John deGravelles, respectively, to theft of government funds, in violation of Title 18, United States Code, Section 641. RHODA ROBERTSON was convicted on February 16, 2016. LOUELLA ROBERTSON was convicted on February 18, 2016.
According to the factual basis presented to the Courts in connection with their guilty pleas, LOUELLA ROBERTSON and her daughter RHODA ROBERTSON stole over $38,000 in United States Department of Housing and Urban Development (HUD) Section 8 Housing Choice Voucher funds. The ROBERTSONS submitted documents to the East Baton Rouge Parish Housing Authority which contained false representations for the purpose of obtaining HUD Section 8 Housing Choice Voucher funds to which they were not entitled. During their respective re-arraignment hearings, the ROBERTSONS admitted that they fraudulently obtained more than $38,000 in HUD voucher funds between July of 2011 and December of 2014.
Prior to July of 2011, RHODA ROBERTSON engaged in similar conduct and obtained an additional $12,445.25 in HUD Section 8 Housing Choice Voucher funds to which she was not entitled. In all, these defendants fraudulently obtained approximately $50,996 in HUD Section 8 Housing Choice Voucher funds.
U.S. Attorney Green stated: “I am proud to work with the U.S. Department of Housing and Urban Development, Office of Inspector General, and the East Baton Rouge Parish Housing Authority, to aggressively identify and prosecute individuals who steal money from programs designed to help those truly in need of housing assistance. I look forward to continuing our work with HUD-OIG and other investigative agencies to help fight Section 8 fraud.”
This investigation is being conducted by the U.S. Department of Housing and Urban Development, Office of Inspector General. The matter is being prosecuted by Assistant United States Attorney Peter J. Smyczek.
Two California Residents Admit Participating in Mortgage Loan Modification SchemeRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that MEHDI MOAREFIAN, a.k.a. “Michael Miller,” 36, and DANIEL SHIAU, a.k.a. “Scott Decker,” 30, both of Irvine, Calif., pleaded guilty yesterday in Bridgeport federal court to conspiring to defraud homeowners across the United States who were seeking mortgage loan modifications.
According to court documents and statements made in court, MOAREFIAN, SHIAU and others jointly operated a series of California-based companies that falsely purported to provide home mortgage loan modifications and other consumer debt relief services to numerous homeowners in Connecticut and across the United States in exchange for upfront fees. The defendants did business, at various times, as “First Choice Financial Group, Inc.,” “First Choice Financial,” “First Choice Debt,” “Legal Modification Firm,” “National Freedom Group,” “Home Care Alliance Group,” “Home Protection Firm,” “Hardship Center,” “Network Solutions Center, Inc.,” “Premiere Financial Center,” “Premiere Financial,” “Rescue Firm,” “International Research Group LLC,” “Hardship Solutions,” “American Loan Center,” “Loan Retention Firm,” “Clear Vision Financial,” “Green Tree Financial Group,” “Green Tree Financial,” “Enigma Fund, Inc.,” “National Aid Group,” “Southern Chapman Group LLC,” “Save Point Financial,” “Best Rate Financial Solutions,” “Best Rate Financial Solution,” “Best Rate Financial,” “Best Rate Finance Group,” “Nation Star Financial,” and “Nation Star Fin Group.”
Acting as representatives of these entities, the defendants and their co-conspirators cold-called homeowners and offered to provide mortgage loan modification services to those who were having difficulty repaying their home mortgage loans. The defendants charged homeowners fees that typically ranged from approximately $2,500 to $4,300 for their services. To induce homeowners to pay these fees, the defendants falsely represented that the homeowners already had been approved for mortgage loan modifications on extremely favorable terms; the mortgage loan modifications already had been negotiated with the homeowners’ lenders; the homeowners qualified for and would receive financial assistance under various government mortgage relief programs, including the Troubled Asset Relief Program and the Home Affordable Modification Program; and if for some reason the mortgage loan modifications fell through, the homeowners would be entitled to a full refund of their fees.
In fact, the homeowners had not been preapproved for mortgage loan modifications with lenders, mortgage loan modifications had not been negotiated with the lenders, homeowners had not qualified for and did not receive any financial assistance through government mortgage relief programs, and homeowners did not receive a refund of their fees upon request. Few homeowners ever received any type of mortgage loan modification through the defendants’ companies, and few homeowners received refunds of their fees.
MOAREFIAN, SHIAU and others involved in the scheme used pseudonyms and periodically changed their business and operating names to evade detection. The defendants also directed homeowners to mail their checks to addresses and mail boxes that the defendants and their co-conspirators had set up in states other than California.
On January 21, 2016, a grand jury in New Haven returned an indictment charging MOAREFIAN, SHIAU and five other California residents with conspiracy and fraud offenses related to this scheme. The defendants were arrested on January 26.
MOAREFIAN and SHIAU each pleaded guilty to one count of conspiracy to commit mail and wire fraud, an offense that carries a maximum term of imprisonment of 20 years. They also have agreed to pay restitution of approximately $3 million. Sentencing is scheduled for May 11, 2016.
To date, investigators have seized approximately $350,000 from various bank accounts, approximately $362,000 from a Bitcoin account, a $100,000 cashier’s check, and a 2013 Ferrari 458 Italia.
This matter is being investigated by the U.S. Department of Homeland Security – Homeland Security Investigations, U.S. Postal Inspection Service, Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), U.S. Department of Housing and Urban Development – Office of Inspector General, Federal Housing Finance Agency – Office of Inspector General, and Federal Bureau of Investigation, with assistance from the Oklahoma Attorney General’s Office.
The case is being prosecuted by Assistant U.S. Attorneys Avi M. Perry and Sarah P. Karwan.
Two Anchorage men indicted for assaulting a Deputy United States Marshal with a shotgunRead the Press Release
Anchorage, Alaska – Acting U.S. Attorney Kevin R. Feldis announced today that two Anchorage men were indicted by a federal grand jury in Anchorage for assaulting a Deputy United States Marshal with a deadly and dangerous weapon while he was engaged in his official duties.
The two defendants named in the indictment are Leigaga Selau Amituanai, aka “G,” 26, and Sulu Faamolemole, aka “Chase,” 26, both of Anchorage. According to the indictment, Amituanai and Faamolemole assaulted a United States Marshal on Feb. 11, 2016.
According to the criminal complaint filed in federal court late last week, the Deputy United States Marshal was conducting surveillance the morning of Feb. 11, 2016, near Mountain View Drive and North Park Street in Anchorage, when Amituanai pointed a sawed-off shotgun directly at the Deputy United States Marshal from a vehicle that Faamolemole was driving. When Anchorage Police Department officers and the Deputy United States Marshal tried to pull over Amituanai and Faamolemole a short time later, Amituanai and Faamolemole attempted to elude officers, driving down an embankment onto the Glenn Highway exit ramp at Bragaw Street before being apprehended. A sawed-off shot gun, a loaded pistol, and ammunition were recovered from the vehicle.
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 20 years in prison, a fine of $250,000, or both, for the charged offense. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendants.
The United States Marshal Service (USMS) and the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), both branches of the Department of Justice, and the Anchorage Police Department (APD) 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.
Trustee of Retirement Plan Convicted of Filing False ReportsRead the Press Release
Raymond K. Mays, 52, of Crossville, Tennessee, pleaded guilty today to three counts of making a false statement on forms that were filed on behalf of an employee retirement plan. Mays was an employee of Eye Centers of Tennessee, a medical services company based in Crossville and served as a trustee of that company’s 401(k) retirement plan, and had a fiduciary duty to that plan’s beneficiaries.
During a plea hearing before U.S. District Court Judge Todd J. Campbell, Mays admitted that the employee retirement plan made loans to a limited liability company that he controlled, made payments to another company owned by Mays, and leased property to a third company owned by Mays’ wife. Mays acknowledged he personally oversaw these transactions and that these transactions were prohibited by the Employee Retirement Income Security Act of 1974 (“ERISA”) due to the relationship between Mays and these various companies. Mays further admitted that he took steps to conceal the fact that the retirement plan had engaged in financial dealings with entities that he owned and/or controlled, including failing to disclose his relationship with these entities to the third party administrator that helped to prepare the retirement plan’s ERISA filings.
During today’s hearing, Mays also acknowledged signing three false reports that were filed on behalf of the employee retirement plan with the Internal Revenue Service and the U.S. Department of Labor, including one report that falsely stated that the retirement plan had not made any loans and two reports that falsely stated that the retirement plan had not engaged in any prohibited transactions with an interested party.
Mays faces up to 5 years in prison and a fine of up to $250,000 on each count. Mays will be sentenced by Judge Campbell on May 13, 2016. The sentence will be imposed by the Court after consideration of the U.S. Sentencing Guidelines and applicable federal statutes.
The case was investigated by the Employee Benefits Security Administration of the U.S. Department of Labor and by the U.S. Postal Inspection Service. The case is being prosecuted by Assistant U.S. Attorney William F. Abely.
Three Prince George’s County Defendants Indicted in Foreclosure Prevention Fraud SchemeRead the Press Release
Greenbelt, Maryland – A federal grand jury returned an indictment late yesterday against Rene de Jesus de Leon, age 47, and his wife, Pedrina Rodriguez Bonilla, age 37, both of Silver Spring, Maryland, and Ana Maritza Gomez, age 43, of Hyattsville, Maryland, on charges arising from a residential mortgage fraud scheme.
The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Deputy Inspector General for Investigations Rene Febles of the Federal Housing Finance Agency Office of Inspector General (FHFA-OIG); Special Agent in Charge Cary A. Rubenstein of the U.S. Department of Housing and Urban Development Office of Inspector General (HUD-OIG); Chief Henry P. Stawinski of the Prince George’s County Police Department; Postal Inspector in Charge Maria L. Kelokates of the U.S. Postal Inspection Service - Washington Division; and Chief J. Thomas Manger of the Montgomery County Police Department.
According to the 10-count indictment and court documents, from at least January 2011 to August 2015, the defendants told homeowners who wanted to modify their mortgage loans and prevent foreclosure of their homes that -- for an upfront fee, which was usually between $2,000 and $6,000, subsequent monthly payments and a back-end consulting fee -- the defendants could lower the homeowners’ monthly payments and allow them to pay off their loans more quickly. The defendants told the victims to make monthly payments to the defendants and to companies they controlled, in lieu of to the homeowners’ lenders, as part of a “principal reduction consulting program.” The companies controlled by defendants were named Marketing Multiservices LLC and Innovative Solutions Services LLC.
According to the indictment and court documents, the conspirators mailed monthly invoices to the homeowner victims. Some of the victims paid Gomez in person each month at her residence, or a co-conspirator would go to the home of the victim to pick up the monthly payment. The defendants told the victims not to open any mail from their lenders and instead provide it to the conspirators. The indictment alleges, however, that the defendants did not negotiate with lenders of behalf of the homeowners.
According to the affidavit supporting the complaint against Bonilla and Gomez, one victim who was actually current on his mortgage made payments to the program, in lieu of his lender, totaling approximately $50,000, including the initial fee. The victim stopped making payments when he received a foreclosure notice from his lender. Another victim told investigators that she made payments to the program totaling at least $20,000, but nevertheless was evicted from her house, had her cars towed, her dogs boarded and her belongings put on the front lawn.
The defendants face a maximum sentence of 20 years in prison for conspiring to commit mail and wire fraud, and 20 years in prison for each of nine counts of mail fraud. De Leon and Bonilla are currently detained. Initial appearances for the three defendants have not yet been scheduled.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
The Maryland Mortgage Fraud Task Force was established to unify the agencies that regulate and investigate mortgage fraud and promote the early detection, identification, prevention and prosecution of mortgage fraud schemes. This case, as well as other cases brought by members of the Task Force, demonstrates the commitment of law enforcement agencies to protect consumers from fraud and promote the integrity of the credit markets. Information about mortgage fraud prosecutions is available http://www.justice.gov/usao-md/financial-fraud-and-identity-theft.
Today’s announcement is part of the efforts undertaken in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.
United States Attorney Rod J. Rosenstein commended the FHFA-OIG, HUD-OIG, Prince George’s County and Montgomery County Police Departments, U.S. Postal Inspection Service and the Prince George’s County State’s Attorney’s Office for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Kristi N. O’Malley and Special Assistant United States Attorney Jolie F. Zimmerman, who are prosecuting the case.
Three Members of Matusiewicz Family Receive Life SentencesRead the Press Release
WILMINGTON, Del. – David C. Weiss, Acting United States Attorney for the District of Delaware, Kevin L. Perkins, Special Agent in Charge, Federal Bureau of Investigation, Baltimore Division, and Nathaniel McQueen, Jr., Colonel, Delaware State Police, announced today that United States District Court Judge Gerald A. McHugh sentenced Defendants David T. Matusiewicz, Lenore Matusiewicz, and Amy Gonzalez to each serve a term of life imprisonment.
Following a five week jury trial this past summer, 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 today in Delaware, Judge McHugh concluded that David Matusiewicz and his father, Thomas Matusiewicz, acted with premeditated intent in the February 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 Christine Belford’s children.
Defendants Lenore Matusiewicz and Amy Gonzalez likewise received life sentences from Judge McHugh. Defendant Lenore Matusiewicz was sentenced at her bedside last week at Jefferson Medical Center in Philadelphia. Defendant Amy Gonzalez was sentenced after her brother’s sentence was imposed. Judge McHugh concluded that Defendant Gonzalez’s overall stalking conduct was inextricably intertwined with the conduct of her family members and that it was reasonably foreseeable to Defendant 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 Christine 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 Christine 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, Christine Belford. 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 Christine 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 Christine Belford.
After his release from federal custody, David Matusiewicz resided in southern Texas. On January 8, 2013, David Matusiewicz sought and received permission from the United States Probation Office in Texas to travel to Delaware to attend a child support arrearage hearing he had requested. That hearing was scheduled for February 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 February 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 Christine 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 Christine Belford multiple times as she entered the courthouse lobby, killing her. He then shot Laura 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.
St. Thomas Man Sentenced to 120 Months in Prison for Possession of Firearm by Convicted FelonRead the Press Release
St. Thomas, USVI – District Court Judge Curtis V. Gomez sentenced today Tashimo Scatliffe, 33, to 120 months’ imprisonment and three years of supervised release for possession of a firearm by a convicted felon, United States Attorney Ronald W. Sharpe announced. Judge Gomez also ordered Scatliffe to pay a $100 special assessment and perform 400 hours of community service.
On October 20, 2015, Scatliffe pleaded guilty to possession of a firearm by a convicted felon. According to the plea agreement filed with the court, on February 2, 2015, Virgin Islands Police Department (VIPD) officers responded to a domestic disturbance at the Paul M. Pearson Housing Community on St. Thomas. Upon arrival, officers observed Scatliffe leaving the building where the call had originated. The complainant confirmed that Scatliffe was in possession of a firearm. Police searched the area and located a firearm and a spent casing. Analysis of these items verified that the spent casing had been fired from the recovered firearm. In addition, Scatliffe’s DNA was found on the firearm. Scatliffe is a convicted felon and therefore cannot legally possess a firearm in the Virgin Islands. He was previously convicted of felony offenses in the Superior Court of the Virgin Islands.
“This is a great example of federal and local agencies sharing resources to combat violent gun crime and eradicate those who want to destroy our communities,” said Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Special Agent in Charge Carlos A. Canino.
This case was investigated by the ATF and the VIPD. It was prosecuted by Assistant United States Attorney Sigrid M. Tejo-Sprotte.
Siblings Charged in Mortgage Fraud SchemeRead the Press Release
PITTSBURGH - Two residents of Allegheny County, Pennsylvania, have been indicted by a federal grand jury in Pittsburgh on charges of wire and bank fraud conspiracy and bank fraud, United States Attorney David J. Hickton announced today.
The two-count superseding indictment, returned on Feb. 16, named Janna Nassida, 45, of West Mifflin, Pa., and James Nassida, 48, of Pittsburgh, Pa., as the defendants in this case.
According to the indictment, from 2002 to 2008 James Nassida and his sister Janna Nassida knowingly conspired with other individuals known to the grand jury to defraud lenders and consumers. James and Janna Nassida worked at Century III Home Equity, a mortgage broker firm. The fraud scheme involved the submission of loan applications to lenders that contained material misrepresentations about the borrowers’ financial conditions, such as inflating borrowers’ incomes and assets. James and Janna Nassida, along with others who worked at Century III, also submitted bogus supporting documentation for the misrepresentations contained in the applications, as well as appraisals that overstated the values of the properties serving as collateral for the loans.
The law provides for a maximum total sentence of 60 years in prison, a fine of $2,000,000 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendants.
Assistant United States Attorney Brendan T. Conway is prosecuting this case on behalf of the government.
The Mortgage Fraud Task Force conducted the investigation leading to the Indictment in this case. The Mortgage Fraud Task Force is comprised of investigators from federal, state and local law enforcement agencies and others involved in the mortgage industry. Federal law enforcement agencies participating in the Mortgage Task Force include the Federal Bureau of Investigation; the Internal Revenue Service, Criminal Investigations; the United States Department of Housing and Urban Development, Office of Inspector General; the United States Postal Inspection Service; and the United States Secret Service. Other Mortgage Fraud Task Force members include the Allegheny County Sheriff's Office; the Allegheny County District Attorney’s Office; the Pennsylvania Attorney General's Office, Bureau of Consumer Protection; the Pennsylvania Department of Banking; the Pennsylvania Department of State, Bureau of Enforcement and Investigation; and the United States Trustee's Office.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Ship Captain Pleads Guilty to Felony Obstruction Related to Pollution from Tanker Ship Traveling to CharlestonRead the Press Release
A Filipino citizen and the captain of the tanker ship, T/V Green Sky, pleaded guilty today to one felony count in federal court in Charleston, South Carolina, for obstructing a U.S. Coast Guard investigation into pollution crimes aboard the vessel.
Genaro Anciano, 52, who was the highest ranking officer aboard the ship, pleaded guilty to one count of Obstruction of an Agency Proceeding. The charge stems from a Coast Guard investigation in late August 2015 into the bypass of pollution prevention equipment, including the use of a “magic device,” on the Green Sky. In court papers, the defendant stated that members of the ship’s engine room, including a senior officer, admitted to illegally discharging overboard. These admissions occurred prior to the August 2015 Coast Guard inspection at the Port of North Charleston. During the investigation, Anciano made several false and misleading statements to the Coast Guard to cover up the illegal conduct.
The T/V Green Sky is a 30,263 gross ton, ocean-going vessel that operates as a petroleum and chemical tanker. The vessel is approximately 600 feet in length and is registered in Liberia. The vessel is owned by an entity incorporated in the Marshall Islands. Over the course of several days, the normal operation of the Green Sky generates thousands of gallons of bilge wastes that are contaminated with petroleum products and oil residues. These bilge wastes must be removed for the vessel to operate safely.
Both the United States and Liberia are parties to the MARPOL treaty, which regulates the overboard discharge of bilge waste. It was prohibited to discharge bilge wastes from the T/V Green Sky without first running that effluent through the ship’s oily water separator. According to the MARPOL treaty, all overboard discharges from the vessel’s bilges had to be recorded in the T/V Green Sky’s oil record book. A bypass of the oily water separator, which is not recorded in the oil record book, jeopardizes the accuracy and integrity of that document. It is a separate federal crime for oceangoing vessels to enter a U.S. port with a false oil record nook.
Anciano’s sentencing has not been scheduled.
The case was investigated by the U.S. Coast Guard Investigative Service with assistance from inspectors from Sector Charleston as well as Legal from U.S. Coast Guard in Miami. The case is being prosecuted by Christopher L. Hale of the Justice Department’s Environmental Crimes Section of the Environment and Natural Resources Division and Assistant U.S. Attorney Matt Austin of the U.S. Attorney’s Office for the District of South Carolina in Charleston.
Sex Offender Sentenced to 139 Months in Prison for Assaulting a Federal OfficerRead the Press Release
TUCSON, Ariz. – Today, Howard James Sawyer, 41, of Iowa City, Iowa, was sentenced by U.S. District Judge Cindy K. Jorgenson to 139 months in prison. Sawyer had previously pleaded guilty to assaulting a federal officer.
On February 2, 2015, Sawyer was incarcerated in the federal penitentiary in Tucson, Ariz., because of a conviction for failure to register as a sex offender. When informed that his request for a housing reassignment was denied he became angry and punched a Corrections Officer in the eye. The attack caused the officer to suffer permanent vision impairment.
The investigation in this case was conducted by the Federal Bureau of Investigation. The prosecution was handled by Jesse Figueroa, Assistant U.S. Attorney, District of Arizona, Tucson.
CASE NUMBER: CR-15-00897-CKJ-EJM
RELEASE NUMBER: 2016-013_Sawyer
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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.
Sentencings for February 11 - February 18, 2016Read the Press Release
James Patrick Mahoney, 31, of Torrington, Wyoming, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on February 18, 2016, for being a felon in possession of a firearm. Mahoney was arrested in Torrington, Wyoming. He received 63 months imprisonment, to be followed by three years of supervised release, and was ordered to pay a $300.00 fine and a $100.00 special assessment. This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Maria Lynn Caparotta, 25, of Cheyenne, Wyoming, was sentenced by Federal District Court Judge Alan B. Johnson on February 16, 2016, for possession with intent to distribute less than 50 grams of heroin. Caparotta was arrested in Cheyenne, Wyoming. She received 41 months imprisonment, to be followed by three years of supervised release, and was ordered to pay a $400.00 fine and a $100.00 special assessment. This case was investigated by the Cheyenne Police Department.
Simone Marie Mandan, 20, of Riverton, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on February 11, 2016, for assault resulting in serious bodily injury. Mandan was arrested in Riverton, Wyoming. She received 33 months imprisonment, to be followed by two years of supervised release, and was ordered to pay a $100.00 special assessment. This case was investigated by the Bureau of Indian Affairs.
San Clemente, California Man Pleads Guilty to Conspiracy to Distribute 15 Kilograms of CocaineRead the Press Release
BOISE – Christopher “Farley” Woods, 57, of San Clemente, California, pleaded guilty today to conspiracy to distribute cocaine, U.S. Attorney Wendy J. Olson announced. Woods was indicted by a federal grand jury in Boise on August 11, 2015.
According to the plea agreement, Woods admitted that between 2008, and June 9, 2015, he conspired to distribute cocaine by supplying co-conspirators in Idaho and Utah with 15 kilograms of cocaine. He also admitted to selling each kilogram of cocaine for $35,000. As part of his plea agreement, Woods agreed to forfeit 1.4 million dollars in cash proceeds, his residence in Orange County, California, $77,400 in seized currency, and three million shares of stock.
The charge of conspiracy to distribute cocaine is punishable by at least five years, but not more than forty years in prison, a maximum fine of $5,000,000, and at least four years of supervised release.
Sentencing is set for May 24, 2016, before Chief U.S. District Judge B. Lynn Winmill at the federal courthouse in Boise.
The case was investigated by the Drug Enforcement Administration, U.S. Marshals Service Asset Forfeiture Division, Blaine County Narcotics Enforcement Team, Blaine County Sheriff’s Office, and the Los Angeles Interagency Metropolitan Police Apprehension Crime Task Force.
San Antonio Man and Woman Charged in Alleged Mail Theft and Financial Institution Fraud SchemeRead the Press Release
In San Antonio this week 31-year-old Michael McKinney had his initial appearance before U. S. Magistrate Judge Henry J. Bemporad on charges of possession of stolen mail, access device fraud, financial institution fraud and aggravated identity theft announced United States Attorney Richard L. Durbin, Jr., and U.S. Postal Inspection Service Team Leader Michael R. Martinez-Partida.
McKinney’s co-defendant, 30-year-old Jennifer Burns, had her initial appearance before Judge Bemporad on February 2, 2016. Burns is charged with possession of stolen mail, financial institution fraud and aggravated identity theft.
As alleged in the indictment, on or about June 28, 2015, McKinney and Burns were caught in possession of stolen mail, including stolen checks, from various San Antonio mailboxes. Prior to that date, the defendants utilized information from stolen mail, changed the payee name on stolen checks, and cashed the checks at various financial institutions using counterfeit drivers’ licenses.
Both defendants remain in custody. Upon conviction, McKinney and Burns each face up to 5 years in prison and a maximum $250,000 fine for the possession of stolen mail charge; each face up to 30 years in prison and a maximum $1,000,000 fine for the financial institution fraud charge; and each face a mandatory consecutive 2 years in prison and a $250,000 fine for the aggravated identity theft charge. In addition, McKinney faces up to 10 years in prison and a maximum $250,000 fine for the access device fraud charge.
“Theft of U.S. Mail is a serious offense and a violation of federal law. Postal Inspectors work vigorously to identify and bring to justice those responsible for committing this criminal act,” stated Team Leader Michael R. Martinez-Partida of the U.S. Postal Inspection Service in San Antonio.
If you believe you are a victim of mail theft, please contact the U.S. Postal Inspection Service at 1-877-876-2455 or at www.postalinspectors.uspis.gov to file a complaint.
Assistant United States Attorney Thomas P. Moore is prosecuting this case on behalf of the Government.
A criminal indictment is merely a charge and should not be considered as evidence of guilt. The defendants are presumed innocent until proven guilty in a court of law.
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Saint Paul Man Indicted for Dealing Firearms without a LicenseRead the Press Release
United States Attorney Andrew M. Luger today announced a federal indictment charging EITAN BENJAMIN FELDMAN, 28, for illegally dealing in firearms without a license and lying on at least nine firearms transaction records (Form 4473).[1] The defendant is expected to appear later today before Magistrate Judge Mayeron in United States District Court in Minneapolis, Minn.
“There is far too much gun violence in the Twin Cities,” said U.S. Attorney Luger. “Violent crimes involving guns are often committed by people who cannot legally obtain a firearm, but they find a way. According to today’s indictment, Eitan Feldman was one of those ways. This defendant engaged in the business of dealing guns without a license. He didn’t conduct background checks on the people to whom he sold the guns, and at least three of the guns were connected to Twin Cities crime scenes. Thanks to the dedicated special agents of the ATF, Feldman today is in custody and there is one less backdoor through which potential criminals can get a gun.”
“Today’s arrest should send a message to unlicensed firearm dealers who put the public at risk each time they sell a firearm to a potential criminal,” said ATF St. Paul Field Division Special Agent in Charge James Modzelewski. “They are recklessly circumventing the criminal background check system and it is a crime.”
According to the indictment and documents filed in court, between January 2014 and January 2016, FELDMAN engaged in a regular pattern and practice of unlawfully dealing in firearms without a license by repeatedly purchasing firearms and offering them for resale within days of getting them. FELDMAN routinely purchased firearms offered by out-of-state Federal Firearms Licensees (FFLs) through websites such as gunbroker.com, an online firearms auction site. FELDMAN arranged to have the firearms transferred to L.E. Gun Sales, a FFL in Minnesota, where he received and took possession of the guns after completing and signing the appropriate documentation and submitting to a National Instant Criminal Background System (NICS) check.
According to the indictment and documents filed in court, during the same time period, FELDMAN regularly listed and offered the same firearms for sale – often at a higher price than what he paid – on armslist.com, a website that allows individuals to list firearms for sale. Of the 41 guns FELDMAN purchased and re-sold during this time, the average time he actually possessed a gun before offering it for resale was only nine days.
According to the indictment and documents filed in court, FELDMAN would sometimes include on his for-sale listings on armslist.com a false story indicating that he had actually owned a particular firearm for much longer than he had or concoct a reason why he was then selling the gun. For example, on one listing for a 20-guage pump-action shotgun that FELDMAN had possessed for only two days before listing on armslist.com, FELDMAN wrote that he, “is a gun collector, has had the shotgun for two years, never shot it.” On another listing for a .38 caliber handgun that he had possessed for only seven days before listing for resale, FELDMAN wrote, “bought a couple of years ago but only taken to the range a few times.” In yet another listing for a semiautomatic 9mm carbine rifle that he had possessed for only six days, FELDMAN claimed that the rifle had been “sitting in [his] closet for a few months” and that he had not fired it for about four months.
According to the indictment and documents filed in court, in July 2015, an ATF Special Agent told FELDMAN that some of the firearms he had received at L.E. Gun Sales, and subsequently sold, had been linked to crime scenes within days of FELDMAN taking possession of and selling the guns.
According to the indictment and documents filed in court, on April 26, 2015, the Minneapolis Police Department (MPD) recovered a loaded Ruger .380 pistol when responding to a gun-pointing assault. The weapon was submitted for National Integrated Ballistics Information Network (NIBIN) analysis, which showed that the weapon had also been used on March 19, 2015, in a shots-fired incident from which MPD recovered two spent shell casings. FELDMAN had purchased this same weapon on March 12, 2015, only seven days before the shots-fired incident and 45 days before it was recovered from the gun-pointing crime scene.
According to the indictment and documents filed in court, on May 28, 2015, MPD responded to a narcotics call, during which they recovered a Bersa Thunder .380. This same gun had been purchased by FELDMAN 18 days earlier on May 10, 2015.
According to the indictment and documents filed in court, on August 25, 2015, Bloomington Police (BPD) identified and stopped several vehicles involved in the transport of at least 50 pounds of marijuana from California to Minnesota. In one of the vehicles, BPD officers recovered a backpack containing two loaded handguns, one of which was a Taurus .38-caliber revolver. One of the suspects admitted that both guns belonged to him and that he had bought the Taurus revolver from a private seller in Minneapolis. That same gun was purchased only three months earlier by FELDMAN on May 10, 2015.
According to the indictment and documents filed in court, on July 17, 2015, ATF Special Agents executed a search warrant at FELDMAN’s home in Saint Paul, Minn., and seized five shotguns. FELDMAN had completed the transfer of each shotgun at L.E. Gun Sales and had listed and offered each shotgun for resale on armslist.com between two and 25 days of receiving them at L.E. Gun Sales. ATF Special Agents also recovered three firearm bills of sale, showing that FELDMAN had sold four firearms to three different individuals. FELDMAN had received the four firearms at L.E. Gun Sales between three and 24 days before reselling them.
According to the indictment and documents filed in court, during at least nine transactions at L.E. Gun Sales in which FELDMAN received the four firearms seized during the search and 23 other firearms that he offered for resale, he falsely represented his residential address on the Form 4473.
According to the indictment and documents filed in court, on October 2, 2015, ATF Special Agents served FELDMAN with a written Warning Notice of Unlicensed Firearms Dealing in Violation of Federal Law, warning him that his continuous and repetitive firearm-related activity appears to make him an unlicensed “dealer in firearms” and that he should stop immediately or risk criminal prosecution. Despite the warning, FELDMAN continued his unlawful dealing in firearms on at least eight more occasions.
According to the indictment and documents filed in court, on December 3, 2015, ATF Special Agents made an undercover purchase of a .38-caliber revolver from FELDMAN, a gun that he had received 10 days prior. The undercover officer paid FELDMAN $260 cash in the parking lot of a local shopping mall. FELDMAN never sought to verify the identity of the purchaser, nor did he make any effort to determine if the buyer was prohibited by law from purchasing a firearm. FELDMAN conducted no background check.
According to the indictment and documents filed in court, on January 21, 2016, ATF Special Agents made an undercover purchase of a Hi-Point 9mm semiautomatic carbine rifle from FELDMAN, a gun that he had received seven days prior. The undercover officer paid FELDMAN $250 cash in the parking lot of a local shopping mall. FELDMAN never sought to verify the identity of the purchaser, nor did he make any effort to determine if the buyer was prohibited by law from purchasing a firearm. Again, FELDMAN conducted no background check.
This case is the result of an investigation conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives, Minneapolis Police Department, Saint Paul Police Department and Bloomington Police Department.
Assistant U.S. Attorney Benjamin Bejar is prosecuting the case.
Defendant Information:
EITAN BENJAMIN FELDMAN, 29
Saint Paul, Minn.
Charges:
- Willfully engaging in the business of dealing in firearms without a license, 1 count
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Making a false statement during a firearm purchase, 9 counts
[1] The charges contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Sacramento Man Found Guilty of Federal Charge of Producing Child Pornography that Was Used in Online Ads for Prostitution ServicesRead the Press Release
LOS ANGELES – A federal jury this afternoon convicted a Sacramento man of producing child pornography in a case in which his co-defendant previously pleaded guilty to the sex trafficking of the 16-year-old victim.
Antonio Dickerson, 26, was found guilty of one count of sexual exploitation of a minor for production of child pornography, an offense that carries a mandatory minimum sentence of 15 years and a maximum sentence of 30 years in federal prison.
Dickerson – who was also known by several aliases, including “Girbaud,” “Bohanlin” and “Mayor Marlow” – is scheduled to be sentenced by United States District Judge Stephen V. Wilson on May 2.
Previously in this case, Dickerson’s co-defendant – D’Antoine Thomas, 26, also of Sacramento – pleaded guilty to sex trafficking of a minor. Thomas faces a mandatory minimum sentence of 10 years and a maximum sentence of life in federal prison when he is sentenced by Judge Wilson on March 14.
The victim in the case was 16 when she met Thomas in Sacramento in 2010. She soon started working for Thomas as a prostitute in Northern California. In April 2011, Dickerson transported Thomas, the victim and another prostitute to Orange County. During this trip, Dickerson directed the 16-year-old victim and another prostitute to simulate sex acts, which he photographed and posted on a website to advertise prostitution services.
“No child should be subjected to this type of exploitation,” said United States Attorney Eileen M. Decker. “Protecting our nation’s most vulnerable, especially minors, by aggressively investigating and prosecuting child exploitation crimes is a top priority of the Justice Department.”
The jury that convicted Dickerson today of producing child pornography also acquitted him of a charge of sex trafficking of a minor.
This case is the result of an investigation by the FBI and Sacramento Sherriff’s Department.
Rio Rancho Man Sentenced to Prison for Violating Federal Firearms LawsRead the Press Release
ALBUQUERQUE – Trevor Bianchini, 24, of Rio Rancho, N.M., was sentenced today in federal court in Albuquerque, N.M., for unlawfully possessing a firearm and ammunition. Bianchini was sentenced to 40 months in federal prison followed by three years of supervised release.
Bianchini was arrested in March 2015, on a two-count indictment charging him with (1) being a felon in possession of firearms and ammunition, and (2) possession of body armor by a person who had been convicted of a felony violent crime offense. According to the indictment, Bianchini committed the offenses on May 24, 2014, in Bernalillo County, N.M. At the time, Bianchini was prohibited from possessing firearms, ammunition, or body armor because he previously had been convicted of burglary of a vehicle, conspiracy to commit burglary of a vehicle, and two counts of residential burglary.
On Aug. 18, 2015, Bianchini pled guilty to both counts of the indictment without the benefit of a plea agreement.
This case was investigated by the Albuquerque office of the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Albuquerque Police Department. Assistant U.S. Attorney Jacob Wishard prosecuted the case.
Rio Arriba County Man Sentenced to Five Years for Federal Heroin Trafficking ConvictionRead the Press Release
ALBUQUERQUE – Eugene Vigil, 37, of Truchas, N.M., was sentenced this morning in federal court in Santa Fe, N.M., to 60 months in prison followed by four years of supervised release for his heroin trafficking conviction.
Vigil was arrested on May 5, 2014, on an indictment charging him with participation in a heroin trafficking conspiracy and heroin trafficking. On Aug. 27, 2015, Vigil entered a guilty plea to a heroin distribution charge and admitted distributing more than 100 grams of heroin.
In his plea agreement, Vigil admitted purchasing ten ounces of heroin in Feb. 2014, with the intention of reselling and distributing the heroin to others in and around Rio Arriba County, N.M. According to the plea agreement, on Feb. 25, 2014, law enforcement officers went to Vigil’s residence inquiring about heroin. Vigil agreed to show the officers where he kept his heroin and led them to four guardrails along New Mexico Highway 76. There Vigil showed the officers where he hid his heroin and surrendered approximately 219.9 grams of heroin to the officers.
This case was investigated by the Albuquerque office of the DEA with assistance from the Albuquerque Police Department and the Bernalillo County Sheriff’s Office.
The case was prosecuted by Assistant U.S. Attorney Timothy S. Vasquez pursuant to the New Mexico Heroin and Opioid Prevention and Education (HOPE) Initiative. The HOPE Initiative is a collaborative effort between the U.S. Attorney’s Office and the University of New Mexico Health Sciences Center that is partnering with the Bernalillo County Opioid Accountability Initiative with the overriding goal of reducing the number of opioid-related deaths in the District of New Mexico. The HOPE Initiative comprised of five components: (1) prevention and education; (2) treatment; (3) law enforcement; (4) reentry; and (5) strategic planning. The law enforcement component of the HOPE Initiative is led by the Organized Crime Section of the U.S. Attorney’s Office and the DEA in conjunction with their federal, state, local and tribal law enforcement partners. Targeting members of major heroin trafficking organizations for investigation and prosecution is a priority of the HOPE Initiative.
Richard Johnson sentenced to 12 months and one day in prison for filing a false tax returnRead the Press Release
SHREVEPORT, La. – United States Attorney Stephanie A. Finley announced that Richard Z. Johnson Jr. was sentenced Wednesday to 12 months and one day in prison for filing a false federal income tax return.
Johnson, 59, of Mansfield, La., was sentenced by U.S. District Judge S. Maurice Hicks Jr. on a one-count bill of information charging him with making or subscribing a false tax return. He was also sentenced to one year of supervised release and ordered to pay $275,184 in total restitution of his back taxes. According to the September 21, 2015 guilty plea, Johnson reported a total income of $126,197 on his 2011 U.S. individual tax return but willfully failed to report additional income in the amount of $78,717.
The prison sentence was based on a tax loss of approximately $107,000 attributable to criminal violations of federal tax laws. The plea agreement covers full restitution of all delinquent back taxes, including interest and penalties.
“Mr. Johnson filed a false tax return where he willfully failed to report a significant portion of his income,” Ms. Finley stated. “Filing false returns is a serious crime, and my office will continue to identify and prosecute those who violate our tax laws.”
“The filing and timely payment of income tax returns is an obligation that all Americans should take seriously,” said Special Agent in Charge of IRS Criminal Investigation, Jerome R. McDuffie. “Mr. Johnson is an attorney, a long-time prosecutor, and was well aware of these requirements. One of the responsibilities of citizenship is to abide by our nation’s tax laws. Our agency will continue to work with the United States Attorney’s Office to aggressively investigate allegations of tax crimes and prosecute those who fail to file returns and pay their fair share. Today’s sentence is a reminder that no one is above the law.”
The IRS conducted the investigation. Assistant U.S. Attorneys William J. Flanagan and Seth D. Reeg prosecuted the case.
Resident Alien from Mexico Sentenced to 70 Months for Federal Heroin Trafficking ConvictionRead the Press Release
ALBUQUERQUE – Francisco Hernandez-Hernandez, 24, a resident alien from Chihuahua, Mexico, who resides in Albuquerque, N.M., was sentenced this morning in federal court in Santa Fe, N.M., to 70 months in prison for his heroin trafficking conviction. He will be deported after completing his prison sentence.
Hernandez-Hernandez was arrested on May 4, 2014, on an indictment charging him with participation in a heroin trafficking conspiracy and using communication devices to facilitate drug trafficking crimes. On Oct. 13, 2015, Hernandez-Hernandez entered a guilty plea to a heroin distribution conspiracy charge and admitted being a member of a heroin distribution conspiracy.
In his plea agreement, Hernandez-Hernandez admitted joining the conspiracy in Dec. 2013, and participated in its activities until April 2014. Hernandez-Hernandez acknowledged that he delivered and sold heroin provided by organizers and managers of the conspiracy. On a typical day, he sold heroin to 30 customers. Hernandez-Hernandez also provided direction and guidance to less experienced deliverymen and helped coordinate delivery of the conspiracy’s heroin.
The plea agreement states that in April 2014, Hernandez-Hernandez traveled to California at the direction of the conspiracy’s organizer. In California, Hernandez-Hernandez purchased 750 grams of heroin which was concealed in a loudspeaker box. During his return to New Mexico, he detoured to Colorado where he left the heroin in a relative’s home after learning that law enforcement authorities were investigating the conspiracy’s drug trafficking activities. Hernandez-Hernandez was subsequently detained by law enforcement authorities and the heroin he left in Colorado was surrendered to law enforcement.
This case was investigated by the Albuquerque office of the DEA with assistance from the Albuquerque Police Department and the Bernalillo County Sheriff’s Office.
The case was prosecuted by Assistant U.S. Attorney Timothy S. Vasquez pursuant to the New Mexico Heroin and Opioid Prevention and Education (HOPE) Initiative. The HOPE Initiative is a collaborative effort between the U.S. Attorney’s Office and the University of New Mexico Health Sciences Center that is partnering with the Bernalillo County Opioid Accountability Initiative with the overriding goal of reducing the number of opioid-related deaths in the District of New Mexico. The HOPE Initiative comprised of five components: (1) prevention and education; (2) treatment; (3) law enforcement; (4) reentry; and (5) strategic planning. The law enforcement component of the HOPE Initiative is led by the Organized Crime Section of the U.S. Attorney’s Office and the DEA in conjunction with their federal, state, local and tribal law enforcement partners. Targeting members of major heroin trafficking organizations for investigation and prosecution is a priority of the HOPE Initiative.
Previously Deported Mexican National Sentenced to Five Years for Federal Heroin Trafficking ConvictionRead the Press Release
ALBUQUERQUE – Juan Reyes-Abarca, 31, a Mexican national from Tepic, Nayarit, Mexico, illegally residing in Albuquerque, N.M, was sentenced this morning in federal court in Santa Fe, N.M., to 70 months in prison for his heroin trafficking conviction. He will be deported after completing his prison sentence.
Reyes-Abarca was arrested on April 3, 2014, on a criminal complaint charging him with unlawfully reentering the United States after being convicted of an aggravated felony. According to the criminal complaint, Reyes-Abarca was arrested in Bernalillo County, N.M., while driving another person to retrieve heroin. It further alleged that Reyes-Abarca was deported in Dec. 2006, after he was convicted on state heroin trafficking charges in Bernalillo County. Reyes-Abarca subsequently was indicted and charged with conspiracy to distribute more than 100 grams of heroin.
On May 14, 2015, Reyes-Abarca pled guilty to participating in a conspiracy to distribute heroin. In his plea agreement, Reyes-Abarca admitted that in Jan. 2014, he joined a conspiracy that acquired and distributed heroin in Bernalillo County. His role in the conspiracy was to order and obtain heroin from suppliers and he frequently “processed bulk heroin received from suppliers by ‘cutting’ or diluting the heroin with sugar or other inert substances, dividing the … heroin into smaller portions, and re-packaging the heroin into small plastic bags for further distribution.” Reyes-Abarca also admitted that he also delivered and sold heroin himself.
This case was investigated by the Albuquerque office of the DEA with assistance from the Albuquerque Police Department and the Bernalillo County Sheriff’s Office.
The case was prosecuted by Assistant U.S. Attorney Timothy S. Vasquez pursuant to the New Mexico Heroin and Opioid Prevention and Education (HOPE) Initiative. The HOPE Initiative is a collaborative effort between the U.S. Attorney’s Office and the University of New Mexico Health Sciences Center that is partnering with the Bernalillo County Opioid Accountability Initiative with the overriding goal of reducing the number of opioid-related deaths in the District of New Mexico. The HOPE Initiative comprised of five components: (1) prevention and education; (2) treatment; (3) law enforcement; (4) reentry; and (5) strategic planning. The law enforcement component of the HOPE Initiative is led by the Organized Crime Section of the U.S. Attorney’s Office and the DEA in conjunction with their federal, state, local and tribal law enforcement partners. Targeting members of major heroin trafficking organizations for investigation and prosecution is a priority of the HOPE Initiative.
President of Office Equipment Leasing Company Pleads Guilty for Engaging in Multi-Million Dollar Fraud SchemeRead the Press Release
Earlier today, Michael Conway, the President of Choice Office Solutions LLC, pleaded guilty to wire fraud in connection with a scheme where he forged numerous lease agreements to defraud an individual investor and De Lage Landen Financial Solutions Partner (DLLFSP) of more than $3.5 million. Pursuant to his plea agreement with the government, Conway has agreed that he is liable to pay restitution in the amount of $3,555,493.40 to the individual investor and $1,203,516 to DLLFSP. When sentenced, Conway faces up to 20 years in prison.
The guilty plea was announced by Robert L. Capers, United States Attorney for the Eastern District of New York, and Diego Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI).
“Through a web of lies, deceit and forgeries, Michael Conway induced an individual investor and a lending firm to invest millions of dollars with his company. Conway presented his unsuspecting victims with forged lease agreements and represented to them that he had entered into lucrative contracts to lease office equipment with more than 50 companies, including law firms, universities, and a major league baseball franchise, when in reality, a number of these agreements were worthless,” stated United States Attorney Capers.
“Conway swindled investors to the tune of more than $3.5 million through a series of fraudulent business agreements and lies. Today’s plea and agreement to pay restitution should serve as a warning to others who seek to profit through deception,” stated FBI Assistant Director-in-Charge Rodriguez.
According to court filings and facts presented at the plea hearing, between March 2014 to August 2015, Conway forged lease agreements with various companies in the business of leasing office equipment, and then used these fraudulent agreements to obtain financing from private investors. As part of the scheme, he induced an individual investor to become partners with him in the leasing business. Conway would then purportedly secure a lease from a company, present the signed lease and invoices to the individual investor, who would provide funds to purchase the office equipment to be leased. In this manner, Conway presented the individual investor with leases from approximately 58 companies, including law firms, universities, hospitals, and hotels, and the individual investor paid Conway approximately $3.5 million to purchase office equipment. In reality, most of the leasing agreements that Conway provided to the individual investor were fraudulent, and Conway pocketed most of the individual investor’s money.
One of the fraudulent leasing agreements was purportedly with the New York Mets. Relying on it, the individual investor wire transferred approximately $500,000 to Conway’s bank account to purchase office equipment. Conway then used the same forged lease agreement, and a forged authorization letter from the New York Mets purportedly signed by Jeffrey Wilpon, the team’s Chief Operating Officer, to obtain financing from DLLFSP. Based on these fraudulent documents, DLLFSP wire transferred a total of approximately $313,000 to Conway’s bank account. Through this and other forgeries, Conway defrauded DLLFSP of more than $1 million.
Today’s guilty plea took place before United States District Judge William F. Kuntz.
The government’s case is being prosecuted by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys Winston Paes and David Pitluck are in charge of the prosecution.
The charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory, and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions, and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit ww.StopFraud.gov.
The Defendant:
MICHAEL CONWAY
Age: 40
Verona, New JerseyE.D.N.Y. Docket No. 16-CR-052 (WFK)
Police Detective Arrested on Drug ChargesRead the Press Release
COLUMBUS, Ohio – An area police detective was arrested without incident this morning on charges that he allegedly possessed with the intent to distribute controlled substances.
Tye L. Downard, 43, of Westerville, allegedly made more than 20 deliveries of narcotics between October 2015 and February 2016, including heroin, cocaine, marijuana and Percocet pills.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division, John F. Oleskowicz, Special Agent in Charge, U.S. Department of Justice Office of the Inspector General, Chicago Field Office, Joseph P. Reagan, Special Agent in Charge, Drug Enforcement Administration (DEA) and Ohio Attorney General Mike DeWine announced the charges.
According to court documents, Downard was employed as a detective at the Reynoldsburg Police Department throughout the investigation, which began after the FBI Public Corruption Task Force received information that Downard was using his official position to engage in illegal activity.
It is alleged that, on 21 occasions between October 2015 and February 2016, Downard delivered drugs to an individual to sell. The complaint further alleges that Downard seized blue-and-white Percocet pills during a search warrant and provided blue-and-white Percocet pills to the individual to sell two days later. Likewise, Downard was involved in the execution of a search warrant that yielded several green glass canning-style jars containing harvested marijuana buds. The next day, Downard allegedly provided the individual with four green glass canning-style jars containing harvested marijuana buds.
Possession with intent to distribute controlled substances is a crime punishable by up to 20 years in prison.
U.S. Attorney Stewart commended the FBI, Ohio Bureau of Criminal Investigation (BCI), Department of Justice OIG and DEA for their investigative work, as well as Assistant U.S. Attorneys Peter Glenn-Applegate, Salvador A. Dominguez, and Jessica W. Knight, who are prosecuting the case.
A criminal complaint merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.
Pittsburgh Man Sentenced to Probation for Selling Uninspected PoultryRead the Press Release
PITTSBURGH -A local resident has been sentenced in federal court to two years’ probation with special conditions on his conviction of transporting poultry without inspection, United States Attorney David J. Hickton announced today.
Senior United States District Judge Maurice B. Cohill imposed the sentence on Xia Vue, 84, of Pittsburgh, Pa.
According to information presented to the court, the defendant had been slaughtering poultry at a dilapidated residential home and was selling the poultry in commerce to retail markets and individual customers. The poultry products sold by the defendant had not been inspected by the United States Department of Agriculture, as required by law.
Prior to imposing sentence, Judge Cohill emphasized the importance of food safety and said that the special conditions of Vue’s probation are necessary to prevent the defendant from continuing to slaughter poultry for commerce.
Assistant United States Attorney Tonya Sulia Goodman prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the United States Department of Agriculture, Office of the Inspector General for the investigation leading to the successful prosecution of Vue.
Pittsburg, Kan., Man Sentenced for Distributing Child PornRead the Press Release
WICHITA, KAN. – A Pittsburg, Kan., man was sentenced Thursday to 96 months in federal prison for distributing child pornography, U.S. Attorney Barry Grissom said.
John Tyler Gariglietti, 32, Pittsburg, Kan., pleaded guilty to one count of distributing child pornography. In his plea, he admitted he used a computer in his home in Pittsburg to access a file sharing network. He stored images of child pornography on his computer that were available to other users on the network. He told investigators he had been collecting child pornography since 2011.
Grissom commended the Wichita Police Department, the Kansas Internet Crimes Against Children Task Force, Homeland Security Investigations and Assistant U.S. Attorney Jason Hart.
Philadelphia Man Charged with Jumping BailRead the Press Release
PHILADELPHIA - Calvin Johnson, 45, of Philadelphia, Pennsylvania, was charged by Information, filed yesterday, with one count of failing to appear as required by conditions of release, announced United States Attorney Zane David Memeger.
If convicted, Johnson faces a maximum possible sentence of 10 years in prison, up to three years of supervised release, a fine, and a $100 special assessment.
The case was investigated by the United States Secret Service and is being prosecuted by Assistant United States Attorney Patrick J. Murray.
An Information is an accusation. A defendant is presumed innocent unless and until proven guilty.
Penn National Racing Official Sentenced to 4 Months in Prison for Fraud in Race Rigging SchemeRead the Press Release
HARRISBURG - The U.S. Attorney’s Office for the Middle District of Pennsylvania announced that a racing official at Penn National Race track in Grantville, was sentenced to 4 months in prison today by Chief U.S. District Court Judge Christopher C. Conner.
According to United States Attorney Peter Smith, Craig Lytel, age 61, of Hershey, Pennsylvania was an employee of the Hollywood Casino at Penn National Race Track (Penn National) who served as a racing official at the track. Lytel pled guilty in September 2015 to wire fraud for accepting money and other gratuities in exchange for providing inside information to trainers on which races to enter their horses in order to have a better chance at winning. On one occasion Lytel was the recipient of an interstate wire transfer of $1,000 from a bank in Kentucky to Lytel’s bank in Pennsylvania in exchange for providing inside information on the makeup of horse races at Penn National. Lytel admitted to accepting cash, dinners, gift cards and golf outings in exchange for the information thereby depriving his employer of his honest service and defrauding other horsemen and the betting public. The identities of the trainers who paid Lytel for the information was not disclosed by the government as the investigation is ongoing.
Lytel was sentenced to serve 4 months in a federal prison and was ordered to surrender at the institution selected by the Bureau of Prisons by 10:00 a.m. on March 23, 2016.
The case was investigated by the Harrisburg Resident Office of the Federal Bureau of Investigation and the Pennsylvania Horse Racing Commission as part of an ongoing investigation of racing at Penn National.
Prosecution of the case was handled by Assistant United States Attorney William A. Behe.
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Pascua Yaqui Brothers Sentenced to Prison for Aggravated Assaults on the Pascua Yaqui Indian NationRead the Press Release
TUCSON, Ariz. – On February 10, 2016, Steven Gabriel North, 33, of Tucson, Ariz., and a member of the Pascua Yaqui Indian Nation, was sentenced by U.S. District Judge James A. Soto to serve 63 months in prison for aggravated assault with a dangerous weapon. On February 18, 2016, Antonio Ruben North, 30, also of Tucson, Ariz., and a member of the Pascua Yaqui Indian Nation, and brother and co-defendant of Steven Gabriel North, was sentenced by Judge Soto to serve 28 months in prison for aiding and abetting his brother in committing aggravated assault with a dangerous weapon. Both defendants had previously pleaded guilty to these offenses.
On July 25, 2014, Steven Gabriel North stabbed four victims with a knife during an altercation. Antonio Ruben North aided his brother in committing the stabbings by physically fighting with the victims. When fleeing from the scene after the altercation, the defendants ran over one of the victims with their vehicle. All four victims suffered injuries from the assault, which occurred on the Pascua Yaqui Indian Nation. One of the victims is also a member of the Pascua Yaqui Indian Nation.
The investigation in this case was conducted by the Federal Bureau of Investigation and the Pascua Yaqui Police Department. The prosecution was handled by Angela W. Woolridge, Assistant U.S. Attorney, District of Arizona, Tucson.
CASE NUMBER: CR-15-0266-TUC-JAS
RELEASE NUMBER: 2016-012_North
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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.
Palmer man indicted for role in heroin related deathRead the Press Release
Anchorage, Alaska – Acting U.S. Attorney Kevin R. Feldis announced today that an indictment has been returned charging a Palmer man with multiple drug felonies, including one count of distributing heroin that led to the death of a young man who used the heroin.
Hiram Luis Ducasse, Jr., 26, is the only defendant named in the three-count indictment. The first count charges Ducasse with conspiring with others to distribute heroin. The second and third counts both charge Ducasse with actually distributing heroin or otherwise possessing heroin with the intent to distribute it. The second count specifically charges Ducasse with distributing the heroin that resulted in the death of another individual, listed in the indictment as M.C.
The indictment stems from an investigation launched by the Drug Enforcement Administration (DEA) and the Alaska State Troopers (AST) after M.C.’s death in December 2015. It is related to two other indictments also issued by the federal grand jury today charging five other individuals from Wasilla, Palmer, and California with drug trafficking and related gun crimes.
Assistant U.S. Attorney Stephanie C. Courter, who presented the case to the grand jury, indicated that Ducasse faces a mandatory minimum penalty of 20 years in prison for the heroin distribution that led to M.C.’s death. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offense and the prior criminal history of the defendant.
The charges against Ducasse and the related indictments are the latest in the ongoing efforts of federal and state law enforcement to combat the increasing prevalence of heroin in our community. According to a February 2015 publication issued by the National Institute on Drug Abuse (NIDA), overdose deaths from heroin abuse have more than doubled since 2010. The Centers for Disease Control (CDC) found that, in 2013 alone, drug overdose was the leading cause of injury death. That year, overdoses caused more deaths than motor vehicle traffic accidents and firearms. Similarly, according to the DEA, of the approximately 47,055 unintentional drug overdose deaths that occurred in the United States in 2014, 61 percent of those (28,647) were caused by prescription painkillers and heroin.
“Sadly, heroin use and distribution is on the rise throughout the country and in Alaska with often tragic consequences; this is one such tragic case,” said Acting U.S. Attorney Feldis. “As a community we must all play a role in combatting the use and distribution of illegal drugs and the addiction, crime and destruction that can too often result.”
“Nationwide, a drug overdose occurs every 12 minutes in which a life is taken by anonymous predators, however today, this heroin dealer is named and will face full accountability,” said DEA Special Agent in Charge Keith Weis.
“Drug and alcohol addiction continues to destroy Alaskans’ lives and we are committed to being part of the solution,” said AST Captain Jeff Laughlin. “By working together with local, state and federal partners, those who are trafficking illicit drugs and contributing to the destruction of our neighbors’ lives will be relentlessly pursued and held accountable. Addiction is a disease, and those who contribute to this illness are put on notice that they will be held responsible, as evidenced by this indictment.”
Ducasse will be arraigned in federal court in the coming days. The DEA and AST 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.
Palm Beach County Resident Convicted of Narcotics Trafficking and Unlawful Gun PossessionRead the Press Release
On February 11, 2016, following a four-day trial, a federal jury in West Palm Beach, Florida, convicted Kevin Raphael Bully of narcotics trafficking and unlawful possession of a firearm.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and A.D. Wright, Special Agent in Charge, Drug Enforcement Agency (DEA), Miami Field Office, made the announcement.
This case stemmed from an investigation into the importation of Alpha-pyrrolidinopentiophenone (“α-PVP”), aka “Flakka,” from China into the United States. In March of 2015, as a part of an ongoing investigation regarding the illegal drug trafficking of synthetic cathinones, specifically Flakka, DEA agents received information about suspected narcotics packages being delivered to Palm Beach County. DEA agents in London, England received information from the British authorities regarding multiple packages that were intercepted coming from a chemical company in Hong Kong, China. The Chinese based chemical company had been utilizing a shipping company to transport chemicals to buyers in the United States. The British authorities found approximately seven packages that contained a white crystallized substance which tested positive for the presence of α-PVP. DEA agents in London provided West Palm Beach agents with the packages’ address information and forwarded the deliveries. The local agents, including a law enforcement officer dressed as a DHL employee, delivered a package to the listed address. Kevin Raphael Bully, 26, of Palm Beach County, answered the door of the identified address and took possession of the package upon delivery.
During the course of the investigation, Bully’s cell phone was found to contain text messages discussing the importation and receipt of packages containing Flakka. In July of 2015, Bully was found at a hotel in Boca Raton, Florida, in possession of over 50 grams of heroin, 1,600 tablets of Zanax, a digital scale and packaging used for the distribution of narcotics.
At trial, Bully was found guilty of seven of the eight counts charged in a superseding indictment, to wit: conspiracy to possess with intent to distribute α-PVP, in violation of Title 21, United States Code, Section 846; attempted possession with intent to distribute α-PVP, in violation of Title 21, United States Code, Section 841(a)(1); conspiracy to import α-PVP, in violation of Title 21, United States Code, Section 963; attempting to import α-PVP, in violation of Title 21, United States Code, Section 963; possession with intent to distribute heroin and Zanax, in violation of Title 21, United States Code, Section 841(a)(1); and possession of a firearm by a convicted felon, in violation of Title 18, United States Code, Section 922(g)(1). Bully was found not guilty of possessing a firearm in furtherance of a violent or drug-trafficking offense, in violation of Title 18, United States Code, Section 924(c)(1)(A).
Bully faces a maximum sentence of 20 years in prison on the drug importation and trafficking counts. He also faces a maximum sentence of 10 years in prison for the firearm offense.
“The manufacture, importation and sale of synthetic drugs such as ‘Flakka’ presents a danger to our citizens, since these illicit narcotics are being produced without regard to safety protocols and can have grave negative health effects upon human consumption,” said United States Attorney Ferrer. “Floridians can continue to be proud of the hard work and cooperation by federal, state and local law enforcement to identify, investigate, and prosecute the offenders who bring synthetic drugs into our communities.”
DEA Special Agent in Charge A.D. Wright stated, “The presence of Flakka in our communities is extremely dangerous. Because of the violent and uncontrollable effects it has when ingested, it threatens everyone’s safety and highly jeopardizes the community’s well-being. DEA, along with our law enforcement partners, will continue its commitment to the fight against synthetic drugs, particularly Flakka, by identifying and investigating its trafficking and distribution throughout the state of Florida.”
Mr. Ferrer commended the investigative efforts of the DEA and support of the United States Marshals Service. The case was prosecuted by Assistant U.S. Attorney Lothrop Morris.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Owner of Commercial Supply Company Admits He Defrauded Public and Private Customers of More Than $700,000Read the Press Release
TRENTON, N.J. – A part owner of Bayway Lumber, a Linden, New Jersey, company that sold commercial and industrial products to numerous public and private entities, today admitted his role in a scheme to defraud customers out of $708,386, U.S. Attorney Paul J. Fishman announced.
Robert R. Dattilo, 61, pleaded guilty before U.S. District Judge Peter G. Sheridan in Trenton federal court to an information charging him with one count of conspiracy to commit mail and wire fraud.
According to documents filed in this case and statements made in court:
From 2007 to November 2015, Dattilo conspired with others to defraud certain customers by engaging in fraudulent business practices, including overbilling, charging for more expensive items or larger quantities of items, and providing free items to employees of customers, then recouping the cost of the items (and additional profits) by overbilling and fraudulent billing.
At Dattilo’s direction, Bayway Lumber inflated the prices on items sold or intentionally failed to provide the prices called for in contractual agreements between Bayway Lumber and customers, including the University of Medicine and Dentistry of New Jersey (UMDNJ) and its successor entities – Rutgers University and University Hospital; the City of Elizabeth; and the New York Transit Authority. These methods included:
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Concealing the true cost of items to Bayway Lumber, sometimes by manually altering vendor invoices, in order to enable Bayway Lumber to bill UMDNJ higher mark-ups.
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Charging Elizabeth prices that did not apply the discounts called for by contracts.
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Consistently billing the Transit Authority for the most expensive items, such as doors, frames and door hardware, permitted by the contract, although Bayway Lumber was providing less-expensive items than what was ordered.
Dattilo also conspired to provide certain customers, such as the Philadelphia Housing Authority, Con Edison, the New York Department of Corrections and the City of Newark, with lower-quality lumber than the customers ordered and paid for. The lower-quality lumber, including “reject” lumber, did not meet certain industry specifications and was not of construction-grade quality, as required by contract. To conceal this product substitution scheme, Dattilo directed Bayway Lumber employees to spray paint or rearrange the lower-quality lumber sent to the customer entities in order to hide any markings on the lumber that would indicate that it was the lower-quality lumber. At Dattilo’s direction, Bayway Lumber also issued invoices to customers that falsely described the lower-quality lumber as the higher-quality lumber that the customers ordered.
Employees of some of Bayway Lumber’s customers, including Amtrak, the Plainfield Board of Education and a Bergen County company identified in the information as “Company 1,” were given a variety of items, including electronics, tickets to sporting events, merchandise and gift cards. Bayway Lumber then overbilled and fraudulently billed those customers to recoup the cost of the gifts, plus additional profits. Dattilo kept a running tally of how much Bayway Lumber overbilled and fraudulently billed those customers, which Dattilo referred to as the “Bank,” to ensure that Bayway Lumber recovered the full cost of the free items.
The charge to which Dattilo pleaded guilty carries a maximum potential penalty of 20 years in prison and a maximum fine of $250,000 or twice the gross gain or loss associated with the offense, whichever is greatest. Sentencing is scheduled for May 23, 2016.
U.S. Attorney Fishman credited special agents with the Office of Inspector General, U.S. Department of Housing and Urban Development, under the direction of Special Agent in Charge Christina Scaringi; special agents of the FBI, under the direction of Acting Special Agent in Charge Andrew Campi; and the Office of Inspector General, Amtrak, under the direction of Special Agent in Charge Robert Koons, as well as investigators of the U.S. Attorney’s Office, for conducting the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorneys Barbara R. Llanes and Cari Fais of the U.S. Attorney’s Office Special Prosecutions Division in Newark.
Defense counsel: Alain Leibman Esq., Princeton, New Jersey
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Otero County Prison Inmates Sentenced to Federal Prison for Scheme to Smuggle Drugs into Otero County PrisonRead the Press Release
ALBUQUERQUE – Two inmates who were housed at the Otero County Prison Facility (OCPF) in Chaparral, N.M., were sentenced today in federal court in Las Cruces, N.M., for their participation in a conspiracy to smuggle methamphetamine and heroin into the OCPF. Armando Lopez, 29, of Anthony, Texas, was sentenced to 84 months in prison followed by three years of supervised release, and Eric Lovato, 32, of Alamogordo, N.M., was sentenced to 70 months in prison followed by three years of supervised release.
Lopez and Lovato were two of six individuals charged in April 2014, in a criminal complaint with conspiracy to violate the federal narcotics laws by smuggling controlled substances into the OCPF. The other defendants charged with participating in the conspiracy were Luis Delgadillo, 39, of El Paso, Texas, who was a corrections officer at OCPF during the conspiracy, Ana Lopez, 26, of Albuquerque, N.M., Nancy Salas, 37, of Alamogordo, N.M., and Gary Borja, 28, of Albuquerque. All six defendants subsequently were indicted on Aug. 20, 2014, and charged with conspiracy to distribute methamphetamine and heroin from Dec. 2013 through April 26, 2014, in Otero County, N.M.
The FBI initiated an investigation into the case in Jan. 2014, after receiving information from the New Mexico Corrections Department showing that Delgadillo was smuggling heroin and methamphetamine into the OCPF. The investigation, which included a review of recorded inmate telephone calls and OCPF surveillance video, physical surveillance and the results of inmate drug testing, identified the six defendants as members of a conspiracy who smuggled narcotics into the OCPF between Jan. 2014 and April 2014.
Lovato pled guilty to the indictment in Oct. 2015, and Armando Lopez entered a similar guilty plea in Nov. 2015. Lovato admitted recruiting Salas to smuggle drugs into the prison and deliver the drugs to Delgadillo, and Lopez admitted recruiting Ana Lopez to do the same thing. On April 26, 2014, at Lopez’s direction, Ana Lopez met with Delgadillo and gave him 25 grams of methamphetamine, 11 grams of heroin and ten Suboxone pills for Delgadillo to smuggle into OCPF.
The four co-defendants have entered guilty pleas to the indictment. On Jan. 12, 2016, Delgadillo was sentenced to 40 months in prison followed by three years of supervised release. On June 24, 2015, Ana Lopez was sentenced to 30 months in federal prison followed by two years of supervised release. Borja and Salas have yet to be sentenced.
This case was investigated by the Las Cruces office of the FBI and the New Mexico Corrections Department and is being prosecuted by Assistant U.S. Attorney Mark A. Saltman of the U.S. Attorney’s Las Cruces Branch Office.
This case is being prosecuted pursuant to the New Mexico Heroin and Opioid Prevention and Education (HOPE) Initiative. The HOPE Initiative is a collaborative effort between the U.S. Attorney’s Office and the University of New Mexico Health Sciences Center that is partnering with the Bernalillo County Opioid Accountability Initiative with the overriding goal of reducing the number of opioid-related deaths in the District of New Mexico. The HOPE Initiative comprised of five components: (1) prevention and education; (2) treatment; (3) law enforcement; (4) reentry; and (5) strategic planning. The law enforcement component of the HOPE Initiative is led by the Organized Crime Section of the U.S. Attorney’s Office and the DEA in conjunction with their federal, state, local and tribal law enforcement partners. Targeting members of major heroin trafficking organizations for investigation and prosecution is a priority of the HOPE Initiative.
Oregon Husband and Wife Plead Guilty to Crimes Related to Filing False Retaliatory Liens Against Federal Judges and Other Federal OfficialsRead the Press Release
An Oregon husband and wife pleaded guilty today to crimes related to filing false retaliatory liens against two federal judges, a clerk of court and a federal prosecutor for performing their official duties, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division.
Ronald D. Joling, 72, formerly of Coquille, Oregon, pleaded guilty to one count of conspiracy to file false retaliatory liens against government officials. His wife, Dorothea J. Joling, 73, also formerly of Coquille, pleaded guilty to one count of filing a false retaliatory lien. In October 2014, the Jolings were convicted on various criminal charges related to their federal income taxes. As part of their guilty pleas today, the Jolings admitted that while they were on pretrial release in the criminal tax case they filed false retaliatory liens claiming that multiple federal officials each owed the Jolings $100.003 million.
Ronald Joling admitted that between August 2013 and February 2014 he conspired with his wife to file and cause the filing of false liens against the real and personal property of two federal judges assigned to the criminal tax case, the Clerk of Court for the U.S. District Court for the District of Oregon and the Assistant U.S. Attorney who prosecuted the tax case. These liens were filed in the public records of the State of California. He also admitted to filing false liens against a former federal judge and the former U.S. Attorney for the District of Oregon. As part of her guilty plea, Dorothea Joling admitted to filing and causing the filing of a false lien against the judge who presided over the Jolings’ criminal tax case.
The Jolings were scheduled to be sentenced in the tax case on April 22, 2015, but did not appear in court. They were fugitives until they were arrested on Oct. 5, 2015 in Arizona. On Dec. 11, 2015, the Jolings were sentenced in the criminal tax case; Ronald Joling was sentenced to 97 months in prison and Dorothea Joling was sentenced to 48 months in prison.
The Jolings each face a statutory maximum sentence of 10 years in prison and a $250,000 fine on the retaliatory lien charges. U.S. District Judge Michael J. McShane set sentencing for June 22.
Acting Assistant Attorney General Ciraolo thanked special agents of the Internal Revenue Service – Criminal Investigation, who investigated the case and Senior Litigation Counsel Jen Ihlo and Trial Attorney Thomas Agnello, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.