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Friday 18 December 2015
Joplin Couple Pleads Guilty to Stealing Mail, Passing Forged ChecksRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that two Joplin, Mo., residents have pleaded guilty in federal court, in separate but related cases, to possessing stolen mail and passing forged checks.
Larissa A. Brady, 32, and her boyfriend, Sheldon Michael Hunt, 32, both of Joplin, pleaded guilty before U.S. Magistrate Judge David P. Rush to the charges contained in Dec. 8, 2015, federal indictments. Brady pleaded guilty today and Hunt pleaded guilty on Tuesday, Dec. 15, 2015.
Brady admitted she had been driving around southwest Missouri between March and June 2015, stealing mail from the mail boxes of businesses and residences to obtain personal information and checks. Brady was gathering information in order to eventually start printing checks but had not progressed to that point. She admitted to cashing the forged checks at various businesses, including Wal-Mart, in order to purchase items that would later be returned to obtain a cash refund. Brady admitted that she had written between $30,000 and $40,000 in stolen checks. Brady also admitted she had gone through approximately 12 check books, each containing 25 checks, which were forged and fraudulently passed at numerous businesses throughout the Joplin area.
Brady was confronted by law enforcement officers at a Joplin Wal-Mart store on June 8, 2015, after she attempted to make an $850 purchase using two different forged checks, which was denied, then returned later the same afternoon to make the same purchase using another forged check. Officers recovered numerous stolen checks, Missouri driver’s licenses, a Social Security card, and other forms of identification belonging to other individuals from Brady’s purse. Officers also searched Brady’s vehicle, where Hunt was waiting for her to return, and recovered numerous checks, credit cards, cash cards, and numerous forms of identification that had been stolen from 66 different individuals in the Joplin area.
Hunt admitted that he was aware Brady was using stolen checks that she would forge and use to make purchases of merchandise so the items could be returned for cash. Hunt admitted that he was involved in stealing mail at various locations in Newton and Jasper Counties, Mo. Hunt had not passed any of the stolen checks, but was well aware of Brady’s actions in passing the checks that he helped steal.
On June 11, 2015, Joplin police officers conducted a traffic stop of Hunt’s vehicle and Hunt was arrested for possession of illegal narcotics. During a search of the vehicle, officers located checkbooks and passports that were in the names of other individuals.
Under federal statutes, Brady and Hunt are each subject to a sentence of up to 15 years in federal prison without parole, plus a fine up to $500,000. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
These cases are being prosecuted by Assistant U.S. Attorney Patrick Carney. They were investigated by the U.S. Postal Inspection Service and the Joplin, Mo., Police Department.
Jefferson County Chosen as One of Seven National Pilot Sites for DOJ Program to Strengthen the Justice System’s Response to Sexual AssaultRead the Press Release
BIRMINGHAM -- Jefferson County has been selected as one of seven pilot sites nationwide to receive funding through the Department of Justice’s Office on Violence Against Women to improve how the justice system in general, and prosecution in particular, handles sexual assault cases, announced U.S. Attorney Joyce White Vance, Jefferson County District Attorney Brandon Falls, Sheriff Mike Hale and Crisis Center Executive Director Meg McGlamery.
Through OVW’s Sexual Assault Justice Initiative, the Jefferson County Commission will receive $400,000 to implement performance measures that reflect promising practices for prosecuting sexual assault cases and promoting justice for victims. U.S. Attorney General Loretta Lynch announced the seven pilot sites this week. Jefferson County joins the city of Los Angeles, Cobb County, Ga., the city and county of Honolulu, the New Hampshire Department of Justice in Concord, the Cherokee Nation in Tahlequah, Okla., and Sauk County, Wis.
“Sexual and domestic violence is a heinous crime, inflicting physical and emotional trauma that can linger for years, with grave consequences for survivors and their loved ones; for neighborhoods and communities and for our country as a whole,” Lynch said. “The Department of Justice is committed to doing everything it can to help prevent, investigate and prosecute these horrendous crimes – including working to ensure that our greatest partners in this effort, the state and local law enforcement officers on whom we all rely, have the tools, training and resources they need to fairly and effectively address allegations of sexual assault and domestic violence.”
“Sexual assault, domestic violence, dating violence and stalking are serious crimes that require a robust criminal justice system response in coordination with community-based organizations and victim service providers,” Vance said. “I am proud of leaders in our community for putting together this outstanding program, which has earned a pilot site designation from the Department of Justice. This program will strengthen prosecutions and promote justice for victims.”
The Jefferson County District Attorney’s Office, the Jefferson County Sheriff’s Office and the non-profit Crisis Center will collaborate on the goals of the initiative. Specifically, funds awarded to Jefferson County will support the development of a specialized unit within the DA’s Office to coordinate investigation and prosecution of sexual assault crimes. The unit will include a bilingual investigator, rape response advocate and special prosecutor. In addition to coordinating investigation and prosecution of sexual assault crimes across the jurisdiction, the special unit will develop and implement a training program for prosecutors and law enforcement, and establish a vertical prosecution program for sexual assaults in Jefferson County, whereby one prosecutor would be assigned to handle a case from start to finish.
The grant award also will support development of enhanced response protocols for the county-wide criminal justice system, and will address reporting barriers for immigrant victims of sexual violence.
“Next year will be a great year for the expansion of services and training of law enforcement, thanks to this Sexual Assault Justice Initiative and the coordinated efforts aimed at combatting sexual assault crimes,” Falls said. “Already this year, my office has worked with the Crisis Center, the YWCA, and the City of Birmingham to launch a Family Justice Center with a focus on assisting victims of sexual assault and domestic violence across Jefferson County. Now, this grant will complement those efforts as a force multiplier aimed at developing best practices in investigation and prosecution, while providing direct training for law enforcement across the county,” he said. “I am thrilled that our efforts in securing this grant have come to fruition, and I look forward to the results we can achieve.”
“I am excited about the possibilities that participation in the Sexual Assault Justice Initiative will offer to victims in Jefferson County,” Hale said. “My office is committed to the success of this project. Every effort will be made to ensure that our deputies participate in the training, support the initiative, and influence other law enforcement agencies to participate.”
“The Department of Justice’s Office on Violence Against Women’s Sexual Assault Justice Initiative will empower survivors of sexual violence to have increased support with and through the criminal justice system,” McGlamery said. “The Crisis Center is excited to deepen our partnership with the Jefferson County District Attorney’s Office and the Sheriff’s Office to provide advocacy and support for those affected by this terrible and prevalent crime.”
The Crisis Center asks that anyone who needs assistance related to sexual violence, or knows of someone who needs help, please call its Rape Response hotline at (205) 323-7273. All services are free and confidential.
The Sexual Assault Justice Initiative grants are part of the Justice Department’s ongoing commitment to protecting women from violence and strengthening the capacity of communities to respond to domestic and sexual violence.
The pilot initiative is designed to strengthen the justice system’s response to sexual violence and enhance collaborations among sexual assault victim services providers, law enforcement agencies and sexual assault medical forensic services providers. With funding from the Grants to Encourage Arrest Policies and Enforcement of Protection Orders Program, the Rural Sexual Assault, Domestic Violence, Dating Violence and Stalking Grant Program and the Tribal Governments Grant Program, SAJI sites will be able to use the funds to strengthen services in their communities that support sexual assault victims.
For more information on OVW and its programs, please visit: www.justice.gov/ovw.
Iowa Hospice to Pay More than $1 Million to Resolve False Claims Act AllegationsRead the Press Release
Iowa Hospice, LLC, has agreed to pay $1,088,244.02 to resolve civil allegations that it violated the federal False Claims Act by submitting false bills to Medicare for hospice services.
The Medicare hospice benefit is only available to patients who elect palliative care (medical care focused on providing patients with relief from pain, symptoms, or stress) for a terminal illness and who have a life expectancy of six months or less if their illness runs the normal course. The government alleged that Iowa Hospice knowingly submitted false claims to the government for payment of these services because, during some or all of the period that certain patients were receiving hospice care, the patients did not have a medical prognosis of six months or less if their illnesses ran their normal course. The claims settled by the agreement are allegations only; there has been no admission or judicial determination of liability.
“The Medicare hospice benefit is only intended for terminally ill Medicare beneficiaries who need end of life care,” said United States Attorney Kevin W. Techau. “We will continue to diligently investigate and pursue all instances of misconduct in federal health care programs to ensure that no federal monies are misspent, all providers play by the rules, and patients receive the care to which they are entitled.”
“Being a hospice provider in the Medicare program is a privilege, not a right. Hospice providers that try to boost their profits by providing hospice care to Medicare beneficiaries who are not terminally ill compromise both the health of those patients as well as the financial integrity of Medicare,” said Special Agent in Charge Gerald T. Roy of the U.S. Department of Health and Human Services, Office of Inspector General. “Our agency will continue to hold such hospice providers accountable for their actions.”
The allegations resolved by the settlement arose from work performed by NCI Advancemed, and an investigation led by the Department of Health and Human Services, Office of Inspector General. False Claims Act cases also arise under the qui tam, or whistleblower, provisions of the False Claims Act. Under those provisions, a private party may file suit on behalf of the United States for false claims and share in any recovery.
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Information: Federal Court ArraignmentsRead the Press Release
The United States Attorney’s Office announced that those persons listed below were arraigned before the U.S. Magistrate and the indictments handed down by the Grand Jury unsealed.
Appearing before U.S. Magistrate Ostby in Billings, on December 17, 2015 and entering pleas of Not Guilty were:
- CHERYL LAVONN HILARIO, a 65-year-old resident of Billings, appeared on charges of conspiracy to possess with intent to distribute and to distribute methamphetamine, and possession with intent to distribute methamphetamine. If convicted of the most serious charges contained in the indictment, HILARIO faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by the Federal Bureau of Investigation. PACER Case Reference. 15-138
Appearing before U.S. Magistrate Johnston in Great Falls, on December 15, 2015 and entering pleas of Not Guilty were:
- PAIGE LARANN DEMARCE, a 26-year-old resident of Fort Kipp, appeared on charges of bank employee fraud and aggravated identity theft. If convicted of the most serious charges contained in the indictment, DEMARCE faces 30 years in prison, $1,000,000 in fines and 5 years supervised release. The case was investigated by the Federal Bureau of Investigation and Fort Peck Tribes Department of Law and Justice. PACER Case Reference. 15-82
- SARAH RAE LARSON, a 32-year-old resident of Trout Creek, appeared on charges of uttering counterfeit obligations. If convicted of the most serious charges contained in the indictment, LARSON faces 20 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the United States Secret Service. PACER Case Reference. 15-81
- AMANDA MIKHA CHERI ST. MARKS, a 21-year-old resident of Wolf Point, appeared on charges of bank employee fraud and aggravated identity theft. If convicted of the most serious charges contained in the indictment, ST. MARKS faces 30 years in prison, $1,000,000 in fines and 5 years supervised release. The case was investigated by the Federal Bureau of Investigation and Fort Peck Tribes Department of Law and Justice. PACER Case Reference. 15-82
Appearing before U.S. Magistrate Johnston in Great Falls, on December 7, 2015 and entering pleas of Not Guilty were:
- MARIO JESUS PARRA CETINA, a 25-year-old resident of Seattle, Washington, appeared on charges of possession with intent to distribute methamphetamine, possession of a firearm in furtherance of a drug trafficking crime, and felon in possession of a firearm. If convicted of the most serious charges contained in the indictment, CETINA faces life in prison, $1,000,000 in fines and 5 years supervised release. The case was investigated by the Federal Bureau of Investigation. PACER Case Reference. 15-86
Appearing before U.S. Magistrate Johnston in Great Falls, on December 4, 2015 and entering pleas of Not Guilty were:
- SILAS JOHN DRUM, a 48-year-old resident of Brockton, appeared on charges of aggravated sexual abuse and abusive sexual contact. If convicted of the most serious charges contained in the indictment, DRUM faces life in prison, $250,000 in fines and lifetime supervised release. The case was investigated by the Federal Bureau of Investigation. PACER Case Reference. 15-84
- TY ROBERT GRAY, a 22-year-old resident of Browning, appeared on charges of conspiracy to possess with intent to distribute methamphetamine, possession with intent to distribute methamphetamine, and distribution of methamphetamine. If convicted of the most serious charges contained in the indictment, GRAY faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by the Bureau of Indian Affairs. PACER Case Reference. 15-83
- LATONNA MARIE SPOTTED EAGLE, a 43-year-old resident of Browning, appeared on charges of conspiracy to possess with intent to distribute methamphetamine, possession with intent to distribute methamphetamine, and distribution of methamphetamine. If convicted of the most serious charges contained in the indictment, SPOTTED EAGLE faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by the Bureau of Indian Affairs. PACER Case Reference. 15-83
Appearing before U.S. Magistrate Lynch in Missoula, on December 2, 2015 and entering pleas of Not Guilty were:
- JAY WILLIAM ISLES, SR., a 52-year-old resident of Kalispell, appeared on charges of illegal export/attempted illegal export, and mailing firearms. If convicted of the most serious charges contained in the indictment, ISLES faces 10 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, U.S. Postal Inspection Service, and Immigration and Customs Enforcement. PACER Case Reference. 15-32
- TANNA LEE MEAGHER, a 25-year-old resident of Kalispell, appeared on charges of illegal export/attempted illegal export, felon in possession of firearms, straw purchase/false statement in connection with a firearms transaction, and mailing firearms. If convicted of the most serious charges contained in the indictment, MEAGHER faces 10 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, U.S. Postal Inspection Service, and Immigration and Customs Enforcement. PACER Case Reference. 15-32
- BRIAN SPAIN., a 29-year-old resident of Kalispell, appeared on charges of illegal export/attempted illegal export, felon in possession of firearms, transferring firearms to a prohibited person, dealing firearms without a license, unlawful transfer of firearms to an out-of-state resident, possession of firearms with obliterated serial numbers, and mailing firearms. If convicted of the most serious charges contained in the indictment, SPAIN faces 10 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, U.S. Postal Inspection Service, and Immigration and Customs Enforcement. PACER Case Reference. 15-32
If any of the above cases are of interest to your media organization and the community it serves, we encourage you to monitor the progress of the case regularly through the U.S. District Court calendar and the PACER system so that you stay current and not miss any important developments in the case.
To establish a PACER account, which will allow you to review documents filed in the case, please go to, http://www.pacer.gov/register.html. To access the district court’s calendar, please go to https://ecf.mtd.uscourts.gov/cgi-bin/PublicCalendar.pl.
Illinois Woman Convicted for Kidnapping and Transportation of a Minor with Intent to Engage in Sexual ActivityRead the Press Release
WASHINGTON – A federal jury in Peoria, Illinois, found Nicole Eason guilty on two counts of kidnapping and one count of transportation with intent to engage in criminal sexual activity with a minor, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney James A. Lewis of the Central District of Illinois and Special Agent in Charge Sean Cox of the FBI’s Springfield, Illinois, Division.
“The Easons took advantage of adopted children at their most vulnerable state and caused them to suffer irreparable abuse,” said Assistant Attorney General Caldwell. “Every child in American deserves a safe home, and this conviction should send a clear message that we will go after anyone who seeks to exploit children and risk their safety.”
“Those who wish to harm children often go to great lengths to deceive and manipulate in order to gain access to them,” said U.S. Attorney Lewis. “Citizen jurors, however, rendered their decision in this case based on the facts and evidence gathered and presented by law enforcement and prosecutors, to hold this defendant accountable.”
“Children are our most precious and vulnerable resource and protecting them from individuals like Mr. & Mrs. Eason who seek to exploit them sexually remains one of this office’s priorities,” said Special Agent in Charge Cox. “Today, the jury sent a clear message that this kind of reprehensible conduct will not be tolerated. We will continue to actively pursue anyone who would destroy a child’s innocence by violating federal child exploitation laws.”
Nicole Eason, 37, and her husband Calvin Eason, 46, both formerly of Danville and Westville, Illinois, were charged in connection with their sexual abuse of a child. The couple has remained in custody since their arrest in April 2015. On Nov. 6, 2015, Calvin Eason pleaded guilty to all three counts in the indictment. Nicole and Calvin Eason are scheduled to be sentenced on March 11, 2016.
Evidence at trial established that in 2006 through 2008, the Easons sought to adopt through an informal process, sometimes referred to as private “re-homing,” in which the legal adoptive family can no longer care for the child and transfer the child to another’s custody. In 2007, the Easons communicated with Minor Victim 1’s parents both through online discussion boards and directly and misrepresented material facts about their background to gain the parents’ trust, including, among other things, that they had a home study “waiver,” which the parents believed was needed to transfer custody of their child and which was used to verify the Easons as fit caregivers. Based on these misrepresentations, one of Minor Victim 1’s parents transported their child across state lines in 2007. The minor testified that while in the Easons’ custody for nearly a month, both Nicole and Calvin Eason sexually abused her.
Evidence at trial also established that in 2008, Nicole and Calvin Eason kidnapped a second minor, Minor Victim 2, in the same manner, and the minor was with them for a few days.
The FBI’s Springfield Division investigated the case in cooperation with the Vermilion County, Illinois, Sheriff’s Department, and Trial Attorney Jennifer Toritto Leonardo of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Elly Peirson of the Central District of Illinois prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Illinois Woman Convicted for Kidnapping and Transportation of a Minor with Intent to Engage in Sexual ActivityRead the Press Release
A federal jury in Peoria, Illinois, found Nicole Eason guilty on two counts of kidnapping and one count of transportation with intent to engage in criminal sexual activity with a minor, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney James A. Lewis of the Central District of Illinois and Special Agent in Charge Sean Cox of the FBI’s Springfield, Illinois, Division.
“The Easons took advantage of adopted children at their most vulnerable state and caused them to suffer irreparable abuse,” said Assistant Attorney General Caldwell. “Every child in American deserves a safe home, and this conviction should send a clear message that we will go after anyone who seeks to exploit children and risk their safety.”
“Those who wish to harm children often go to great lengths to deceive and manipulate in order to gain access to them,” said U.S. Attorney Lewis. “Citizen jurors, however, rendered their decision in this case based on the facts and evidence gathered and presented by law enforcement and prosecutors, to hold this defendant accountable.”
“Children are our most precious and vulnerable resource and protecting them from individuals like Mr. & Mrs. Eason who seek to exploit them sexually remains one of this office’s priorities,” said Special Agent in Charge Cox. “Today, the jury sent a clear message that this kind of reprehensible conduct will not be tolerated. We will continue to actively pursue anyone who would destroy a child’s innocence by violating federal child exploitation laws.”
Nicole Eason, 37, and her husband Calvin Eason, 46, both formerly of Danville and Westville, Illinois, were charged in connection with their sexual abuse of a child. The couple has remained in custody since their arrest in April 2015. On Nov. 6, 2015, Calvin Eason pleaded guilty to all three counts in the indictment. Nicole and Calvin Eason are scheduled to be sentenced on March 11, 2016.
Evidence at trial established that in 2006 through 2008, the Easons sought to adopt through an informal process, sometimes referred to as private “re-homing,” in which the legal adoptive family can no longer care for the child and transfer the child to another’s custody. In 2007, the Easons communicated with Minor Victim 1’s parents both through online discussion boards and directly and misrepresented material facts about their background to gain the parents’ trust, including, among other things, that they had a home study “waiver,” which the parents believed was needed to transfer custody of their child and which was used to verify the Easons as fit caregivers. Based on these misrepresentations, one of Minor Victim 1’s parents transported their child across state lines in 2007. The minor testified that while in the Easons’ custody for nearly a month, both Nicole and Calvin Eason sexually abused her.
Evidence at trial also established that in 2008, Nicole and Calvin Eason kidnapped a second minor, Minor Victim 2, in the same manner, and the minor was with them for a few days.
The FBI’s Springfield Division investigated the case in cooperation with the Vermilion County, Illinois, Sheriff’s Department, and Trial Attorney Jennifer Toritto Leonardo of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Elly Peirson of the Central District of Illinois prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Granite City Man Sentenced for Possession of Methamphetamine with Intent to DistributeRead the Press Release
James L. Porter, Acting United States Attorney for the Southern District of Illinois, announced today that Billy Joe Merchant, age 43, of Granite City was sentenced on Thursday, December 17, 2015 to 70 months in federal prison for possession with intent to distribute methamphetamine.
Merchant pled guilty to the federal charge on May 8, 2015 in U.S. District Court in East St. Louis, Illinois. At the time when he pled guilty, Merchant admitted that he had possessed approximately 30 grams of unusually pure crystal "ICE" methamphetamine at his Granite City mobile home on February 6, 2015. Merchant also admitted that he had intended to sell the methamphetamine which he possessed. ICE often sells for as much as $100 per gram.
Merchant has been continuously confined in federal custody since March 3, 2015. When he is released from his federal prison sentence, Merchant will also have to complete a term of three years of supervised release.
Merchant’s arrest and prosecution was one part of a joint federal/state law enforcement initiative to address the problem of methamphetamine distribution in the Granite City, Illinois area. Evidence in support of this prosecution was obtained in an investigation which was conducted under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF). The OCDETF initiative is designed to bring federal, state, and local law enforcement agencies and resources together to identify, target and dismantle large national and international drug trafficking organizations.
The investigation which led to Merchant’s arrest and conviction was conducted by the Drug Enforcement Administration (DEA), and the Metropolitan Enforcement Group of Southwestern Illinois (MEGSI), and the Granite City Police Department.
The case is assigned to Assistant United States Attorney Robert L. Garrison.
Former president of Toledo Metro Federal Credit Union charged with embezzlementRead the Press Release
The former president of the Toledo Metro Federal Credit Union was charged in federal court related to using his corporate credit card for personal gain of more than $233,000, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio.
Charles Robert Poore, 45, formerly of Toledo, now residing in Pittsburgh, was charged in a criminal information with one count of embezzlement.
Poore was president of the Toledo Metro Federal Credit Union and, as such, has a credit card for business expenses. Poore used that credit card to purchase goods from third-party vendors through an Amazon account. He then sold those items to the credit union using his corporate credit card at a signifcantly inflated cost. This conduct occurred between 2011 and 2014 and realized profits for Poore of approximately $233,933, according to the information.
If convicted, the defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The investigating agency in this case is the Federal Bureau of Investigation. The case is being handled by Assistant United States Attorney Michael J. Freeman.
An information is only a charge and is not evidence of guilt. Defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Former Vancouver, Washington Men Sentenced for ‘Pump and Dump’ Stock Fraud SchemeRead the Press Release
A former Vancouver, Washington resident was sentenced today in U.S. District Court in Tacoma to 51 months in prison for a ‘pump and dump’ stock scheme he undertook even after narrowly avoiding prosecution in an earlier scheme, announced U.S. Attorney Annette L. Hayes. TOVY PUSTOVIT, 21, of Gladstone, Oregon is the fifth and final defendant to be sentenced in the stock fraud schemes. At sentencing U.S. District Judge Ronald B. Leighton said “this is a serious offense that corrodes confidence in our markets.”
“The people damaged by these “pump and dump” schemes not only lose money, they lose trust in our financial markets,” said U.S. Attorney Annette L. Hayes. “This defendant was warned that what he was doing was wrong and yet he kept right on cheating and defrauding investors. He will now pay the price for that decision.”
According to the facts set out in the plea agreement, PUSTOVIT participated in a 2012 scheme with Alexander Hawatmeh, Mikhail Galas and Christopher Mrowca to manipulate the stock of ISM International, Inc. PUSTOVIT was not originally charged criminally in that stock manipulation scheme, but following the arrest of the other defendants, investigators uncovered additional information about PUSTOVIT’s participation and about his continuing to scheme to manipulate penny stocks.
In August 2014, Judge Leighton entered a preliminary injunction barring PUSTOVIT and the other defendants from engaging in stock fraud in a civil enforcement action brought by the U.S. Securities and Exchange Commission. Despite that warning, in November 2014 PUSTOVIT conspired with another individual, MARIUS MORARIU, 21, of Beaverton, Oregon in a ‘pump and dump’ scheme involving three companies in the over-the-counter market. PUSTOVIT and MORARIU sought to manipulate the value of Brightech, Inc. (ticker symbol BRTE), General Environmental Management, Inc. (ticker symbol GEVI), and Green Street Capital Corp. (ticker symbol JAGR). MORARIU lined up various apparently unrelated accounts and took cash from PUSTOVIT to purchase the penny stocks. After substantial amounts of stock had been purchased, the two sent out email blasts from various stock promotion websites they controlled: Infinity Stock Picks, Zeus Alerts and Hulk Alerts urging others to buy the stocks. When the price rose further, the two dumped their shares making a significant profit.
Specifically, they manipulated GEVI in early 2015, accumulating some 2.7 million shares. On February 5, 2015 they sent out email blasts from the three different companies touting the stock as being “ready to soar” in value. The stock price rose sharply on the promotion, and the men sold their stock reaping $83,096 in net profits. In the days that followed the price of the shares collapsed harming numerous investors who had been defrauded.
PUSTOVIT has agreed to forfeit to the U.S. $266,373 as criminal proceeds from the overall scheme.
MARIUS MORARIU was sentenced today to three years of probation with ten months of house arrest.
The original coconspirators in the trading of ISM International, Inc., have all been sentenced. Alexander Hawatmeh was sentenced to five years in prison, and Christopher Mrowca was sentenced to three years in prison and Mikhail Galas was sentenced to time served.
The case was investigated by the FBI. The Securities and Exchange Commission (SEC) is conducting a parallel civil investigation. The case is being prosecuted by Assistant United States Attorneys Justin Arnold and Katheryn Kim Frierson.
Former U.S. State Department Employee Indicted in $2 Million Government Contract ConspiracyRead the Press Release
ALEXANDRIA, Va. – Kenneth Apple, 65, of Beaverton, Oregon, was indicted by a federal grand jury yesterday on charges related to his role in awarding $2 million in micro-dairy contracts from the U.S. government for use in Iraq.
According to the indictment, Apple, a former employee with the U.S. Department of State, helped to steer the sole-sourcing of $2 million in micro-dairy contracts to a company in which his son, Jonathan Apple, owned a 50 percent interest. However, Jonathan Apple and his partner had no technical experience in the industry. Kenneth Apple conspired to use his official position to pass on non-public information to his son in order to fraudulently award and administer government contracts. The conspirators further provided false information to, and concealed material details from the U.S. government.
According to the indictment, Kenneth Apple provided templates and technical specifications used in the proposal submitted by Jonathan Apple and his partner to the U.S. government. In addition, Kenneth Apple caused false and misleading statements to be made to the U.S. government regarding his experience, ownership interest, and the status of the projects. For example, Kenneth Apple directed a conspirator to keep Jonathan Apple’s name off the company’s website and any ownership documents. When federal law enforcement agents confronted Kenneth Apple about the scheme, he made false statements, including that he could not recall the owner of the company that won the micro-dairy contracts and that he did not receive any money from the contracts.
Kenneth Apple faces a maximum penalty of 20 years in prison if convicted of wire fraud or obstruction of an official proceeding, and five years in prison if convicted of conspiracy or false statements. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office; Frank Robey, Director of the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit (MPFU); and Robert E. Craig, Special Agent in Charge for the Defense Criminal Investigative Service’s (DCIS) Mid-Atlantic Field Office, made the announcement. Assistant U.S. Attorneys Uzo Asonye and Katherine Wong are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:15-cr-363.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.
Former Philadelphia Sheriff and One Other Charged in Fraud ConspiracyRead the Press Release
PHILADELPHIA – A superseding indictment, unsealed today, charges former Philadelphia Sheriff John Green, 68, of Kissimmee, Florida, and James Davis, 65, of Wyncote, Pennsylvania, with conspiracy and four counts of honest services fraud involving the Philadelphia Sheriff’s Office (“PSO”), announced United States Attorney Zane David Memeger. Davis is also charged with two counts of filing a false tax return and three counts of willful failure to file a tax return.
The indictment alleges that as Sheriff of Philadelphia, John Green was responsible for the execution of all the duties of the PSO, including the PSO’s sale of real property subject to mortgage foreclosure and tax sales at Sheriff’s sales. James Davis was co-owner of an advertising and public relations company, Reach Communications Specialists, and a title search and settlement company, RCS Searchers, Inc. John Green and James Davis enriched each other through their abuse of the public trust placed in the Sheriff to conduct his duties honestly in the best interest of the citizens of Philadelphia and the distressed owners who lost their properties at Sheriff’s sales. Green agreed to Davis’ companies receiving contracts, business, and fees from the PSO in the sale of the real estate, which they hid from the public, in exchange for Davis providing Green extensive personal benefits, which they also hid. From 2002 through 2010, Davis and his companies developed near exclusive control of much of the work connected to the PSO court-ordered sales of properties. Davis and his companies also handled the advertising for Green’s reelection campaigns, including for Green’s 2007 reelection campaign. According to the indictment, Davis provided Green with a stream of personal benefits that included: buying and renovating a home for Green which was then sold to Green at a loss; providing more than $210,000 in hidden payments to Green’s 2007 reelection campaign; and giving more than $320,000 as gifts and interest-free loans to Green for Green’s retirement home in Florida. It is further alleged that in exchange for these benefits, no other vendors were allowed to bid and compete against Davis’ companies for the services that they provided to the PSO related to the sale of properties at Sheriff’s sales; Green expanded the amount of services provided by Davis’ companies and paid for out of the proceeds of the Sheriff’s sales; and Green allowed Davis’ companies to add and increase fees that were paid for out of the proceeds from the Sheriff’s sales. Each dollar that went to Davis and his companies from the property sales was a dollar that would never make it to the distressed property owners who were entitled to the remainder of the proceeds after the satisfaction of liens and necessary costs. Also, Davis was permitted to place friends and family members on the staff at the PSO who were assigned responsibilities connected to the Sheriff’s sales.
It is further alleged that Davis willfully filed a false U.S. income tax return for Reach Communications for tax year 2007 by falsely reporting a business loss of approximately $146,669, which he knew was not true. Davis allegedly filed a false individual 2007 U.S. income tax return, by falsely reporting a taxable income of $408,072, which Davis knew was not true. Davis is also charged with willfully failing to file tax returns for tax years 2008, 2009, and 2010.
If convicted of all charges, Davis faces a statutory maximum sentence of 94 years in prison, a $775 special assessment, a possible fine, and supervised release; and Green faces a statutory maximum sentence of 85 years, a $500 special assessment, a possible fine, and supervised release. The indictment also includes a notice of forfeiture seeking $7,000,000 and property from Davis and Green.
The case was investigated by the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigation Division, and the Philadelphia Office of the Inspector General, and is being prosecuted by Assistant United States Attorneys Sarah Grieb and Christopher Diviny.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Former HSI Special Agent Pleads Guilty to Taking Bribes from Korean Businessman Being Investigated for Human TraffickingRead the Press Release
LOS ANGELES – A former special agent with U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) pleaded guilty this afternoon to accepting thousands of dollars in bribes from a man who had been accused of trafficking a woman into the United States to be a sex slave.
Joohoon David Lee, 43, who currently resides in Las Vegas, Nevada, pleaded guilty to one count of bribery before United States District Judge Michael W. Fitzgerald.
“Corrupt officials who abuse their positions of power to line their pockets compromise our entire system of government,” said United States Attorney Eileen M. Decker. “In this case, a federal law enforcement officer thwarted justice in exchange for just a few thousand dollars and hindered the ability of a possible trafficking victim to seek justice.”
Lee accepted money from a Korean man identified in court documents at “H.S.” According to a plea agreement filed in this case, Lee, who was assigned to HSI’s Human Trafficking unit in Los Angeles, interviewed a woman in March 2012 who claimed that she was entering the United States to be a slave for a Korean businessman named H.S.
About a year later, according to the plea agreement, Lee met with an attorney representing H.S. and told the lawyer that Lee could fly to Korea, interview H.S. and submit a favorable report – if H.S. would finance the trip. H.S. agreed, and Lee accepted $3,000 in cash.
Approximately 10 days after receiving the money, Lee travelled to Seoul, where H.S. paid for Lee’s hotel and entertainment expenses. While in Korea, Lee asked for “a large sum of money, “according to the plea agreement, in which Lee admits accepting between $6,000 and $7,000.”
Upon returning to the United States, Lee prepared a report related to the investigation of H.S. that read: “Subject was suspected of human trafficking. No evidence found and victim statement contradicts. Case closed. No further action required.”
“There will be zero tolerance for public officials who abuse their authority and violate the public’s trust,” said Joe Jeronimo, special agent in charge for ICE’s Office of Professional Responsibility. “Guarding against illegal or unethical behavior by those in positions of public trust is not an option – it is an obligation we have to the people we serve. ICE’s Office of Professional Responsibility conducted the investigation in this case and we’ll continue to hold our employees to the highest standards of professional conduct.”
Lee is scheduled to be sentenced by Judge Fitzgerald on May 23, at which time he faces a statutory maximum sentence of 15 years in federal prison.
Former Frisch's Employee Pleads Guilty in Scheme to Embezzle Nearly $4MRead the Press Release
CINCINNATI – Michael Hudson, 53, of Cincinnati, Ohio pleaded guilty in U.S. District Court today to one count of wire fraud and one count of filing a false federal income tax return with the Internal Revenue Service (IRS) relative to a scheme to defraud Frisch’s Restaurants, Inc. (“Frisch’s”) by embezzling funds in excess of his authorized pay and compensation.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, Guy A. Ficco, Acting Special Agent in Charge, Internal Revenue Service Criminal Investigation, Cincinnati Field Office, and Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division, announced the plea entered into today before U.S. District Judge Michael R. Barrett.
According to court documents, between 1992 and 2014 Hudson was employed at Frisch’s and between 2004 and December 2014 Hudson was the assistant treasurer for Frisch’s. While serving as assistant treasurer, Hudson made unauthorized wire or ACH transfers of funds from the Frisch’s bank accounts for his own benefit. For example, on one occasion, Hudson transferred money from Frisch’s bank account to a bank account in the name of WPMH Properties, LLC, which was a business owned and controlled by Hudson.
In total, between 2008 and 2014 Hudson embezzled $3,905,930.11 from Frisch’s as a result of this fraud scheme.
In addition, Hudson filed a false 2009 income tax return with the IRS. Specifically, Hudson embezzled $323,936.19 from Frisch’s in 2009, but failed to report it as income on his 2009 income tax return.
Also, for the 2010 through 2013 income tax years, Hudson failed to file an income tax return with the IRS in an effort to evade the payment of income taxes related to the embezzlement scheme.
The total amount of income taxes due and owing for the 2009 through 2013 income tax years was $969,697.81.
For the fraud count, Hudson faces a maximum of 20 years in prison and a $250,000 fine or two times the loss. For the tax count, Hudson faces a maximum of 3 years in prison and a $100,000 fine.
“No matter what the source of income, all income is taxable,” said Guy A. Ficco, Acting Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office. “The prosecution of individuals who intentionally conceal income and evade taxes is a vital element of the IRS’s enforcement strategy.”
U.S. Attorney Stewart commended the investigation by IRS-Criminal Investigation and the FBI, as well as Assistant United States Attorney Timothy S. Mangan, who is prosecuting the case.
Former Brockport Fireman Pleads Guilty to Witness Tampering While Awaiting Sentencing for Mail Fraud and Forging Treasury ChecksRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
ROCHESTER, N.Y. - U.S. Attorney William J. Hochul, Jr. announced today that Steven Ray, 50 of Brockport, NY, pleaded guilty to obstructing justice before U.S. District Judge David G. Larimer. The charge carries a maximum penalty of 20 years in prison, a $250,000 fine or both.Assistant U.S. Attorney Craig R. Gestring, who is handling the case, stated that federal law enforcement first encountered Ray because of his role in a mail fraud scheme involving forged United States treasury checks. In February 2015, the defendant was convicted of mail fraud and forging treasury checks. At that time, Ray admitted to cashing more than 120 forged United States Treasury checks worth more than $400,000. The checks were stolen from the New York City Area as well as from other parts of the United States. Ray got the checks mailed to him via the United States Postal Service at his Brockport home.
During that investigation, federal agents identified at least 13 area bank accounts controlled by the defendant under various names. Ray deposited the stolen Treasury checks across these accounts. Many of the checks belonged to people who received Social Security payments, tax refunds, and other money drawn from the United States Treasury to help the intended recipients. As a result of the defendant’s scheme to defraud, Ray obtained more than $400,000 to which he was not otherwise entitled.
While out of custody awaiting sentencing on that case, Ray filed a sentencing statement with the Court in May 2015. Among the items submitted to the Court was a character letter from a local resident who was attesting to the defendant’s character and truthfulness. However, it turned out that this letter was actually forged by Ray. Federal agents met with the witness who confirmed that he never wrote a letter in support of Ray, did not say the things written in the letter, and pointed out that many of the statements in the letter, including the spelling of the witnesses own name was wrong. Based on this, the United States filed a notice with the Court pointing out that the defendant submitted false material to the Court for sentencing. Ray received a copy of that statement the day it was filed.
Within hours of receiving that statement by the government, the defendant went out to the home of that witness, who is wheelchair bound and lives in an assisted living facility, and coerced him into submitting a false affidavit saying that he had actually written the letter to the Court. When Ray did this, he knew that the witness never wrote the original letter, and knew that he was submitting another false document to the Court.
By doing this, Ray obstructed and impeded an official proceeding pending in the United States District for the Western District of New York. Further, the defendant’s actions resulted in the unnecessary expenditure of substantial governmental and Court resources. Ray did all this while he was on pre-trial release pending sentencing in the original fraud case. He was indicted in August, and was taken into federal custody where he has remained.
Ray was a former Officer with the Brockport Fire Department when he was originally arrested for the mail fraud case involving the forged treasury checks.
The plea is the culmination of an investigation on the part of Inspectors from the United States Postal Inspection Service, under the direction of Acting Inspector in Charge James Buthorn, Boston Division, and Special Agents of the Internal Revenue Service, Criminal Investigation Division, under the Direction of Special Agent in Charge of the New York Field Office, Shantelle P. Kitchen.
Sentencing for both cases has been scheduled for January 21, 2016 at 10:00 a.m. before Judge Larimer.
Former Bank Vice President Sentenced in Connection with Rothstein CaseRead the Press Release
A former bank vice president was sentenced to 30 months in prison, in connection with the Rothstein case.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), and George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, made the announcement.
Frank Spinosa, 54, of Ft. Lauderdale was sentenced today in Miami by United States District Judge Beth Bloom to 30 months in prison, to be followed by one year of supervised release. On October 8, 2015, Spinosa pled guilty to conspiracy to commit wire fraud, in violation of Title 18, United States Code, Section 371, in connection with the operation of the former Fort Lauderdale law firm of Rothstein, Rosenfeldt and Adler, P.A. (RRA).
According to court records, including a stipulated statement of facts filed in connection with Spinosa’s guilty plea, in 2009 it was discovered that RRA was being utilized by its Chairman and Chief Executive Officer, Scott W. Rothstein, to commit a massive Ponzi scheme stemming from the sale of fictitious confidential settlements. Spinosa, who, at the time, was a Regional Vice President with TD Bank, admitted that he conspired with Rothstein to induce certain persons into investing money in the confidential settlements through material misstatements by defendant Spinosa. Specifically, Spinosa and Rothstein agreed to utilize the prestige and legitimacy of TD Bank, and Spinosa’s position as Regional Vice President, to give investors in the scheme a false sense of security and induce them into investing in the confidential settlements by fraudulently creating documents that made it appear that certain investment funds were being held in restricted accounts at TD Bank when, in fact, they were not.
Mr. Ferrer commended the investigative efforts of IRS-CI and the FBI. This case is being prosecuted by Assistant U.S. Attorneys Lawrence D. LaVecchio, Paul F. Schwartz, and Jeffrey N. Kaplan.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov
Firearms Traffickers Sentenced to Federal PrisonRead the Press Release
PROVIDENCE, R.I. – Kinmonte Markell Brown, 28, and Dennis Wells, 24, of Greenville, North Carolina, were sentenced in U.S. District Court in Providence today for trafficking more than a dozen firearms from North Carolina into Providence between November 2014 and January 2015.
Kinmonte Brown was sentenced to 84 months in federal prison, and Dennis Wells was sentenced to 78 months in federal prison. Both defendants have also been ordered to serve 3 years supervised release upon completion of their prison terms. Brown and Wells pleaded guilty on September 18, 2015, to conspiracy to deal firearms without a license, dealing firearms without a license, being felons in possession of a firearm and possession of a firearm with an obliterated serial number.
The sentences, imposed by U.S. District Court Chief Judge William E. Smith, are announced by United States Attorney Peter F. Neronha, Rhode Island Attorney General Peter F. Kilmartin, Michael J. Ferguson, Special Agent in Charge of the DEA’s New England Field Division, Daniel J. Kumor, Special Agent in Charge of the Boston Field Division of ATF, and Providence Police Chief Colonel Hugh T. Clements, Jr.
Information that led to the arrest of Brown and Wells in February 2015, and the interruption of the flow of firearms from North Carolina to an apartment in the Hartford Park neighborhood was developed as a result of the Rhode Island Urban Violent Crime Initiative - a wide-ranging collaboration of local, state and federal law enforcement, and federal and state prosecutors who are targeting violent crime and violent criminals in urban neighborhoods of Rhode Island.
In late 2013, the Initiative began targeting the distribution of heroin and crack cocaine in Providence, and the importation of firearms onto the streets of Providence. Simultaneously, and in close coordination, the FBI’s Safe Street Task Force and Providence Police began targeting gang members and associates engaged in violent crime, including gun crimes, in Providence.
Information gathered during these investigations led to a separate investigation by DEA, ATF, Providence Police, and state and federal prosecutors, which resulted in the interruption of the flow of illegal firearms into Providence from Greenville, North Carolina, and the arrest of Kinmonte Brown and Dennis Wells.
According to information presented to the court, beginning in late November 2014, and continuing through January 2015, a person working at the direction of DEA began a series of negotiations with Brown and Wells for a shipment and purchase of illegal firearms. The ongoing negotiations led to a series of sales and the delivery of a total of 15 illegal firearms and ammunition shipped from North Carolina to Providence by Brown and Wells. Each time firearms were delivered they were quickly secured by law enforcement.
On January 31, 2015, as previously arranged by a person working at the direction of DEA, Brown and Wells drove to Rhode Island from North Carolina to sell and deliver seven firearms, including a .357 magnum revolver with an obliterated serial number, a .38 caliber handgun and several shotguns and rifles. Browns and Wells were detained moments after they delivered the firearms.
The case was prosecuted in federal court by Assistant U.S. Attorney Paul F. Daly, Jr. and Joseph J. McBurney, Special Assistant R.I. Attorney General.
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Contact:
Jim Martin (401) 709-5357
email: [email protected]
on Twitter @USAO_RI
Final Defendant in Massive Heroin Trafficking Group SentencedRead the Press Release
NORFOLK, Va. – Jerald Outten, 26, of Portsmouth, was sentenced today to 264 months in prison for his involvement in a heroin trafficking operation that was responsible for the distribution of between 30 and 90 kilograms of heroin with an estimated street value between $1.5 and $4.5 million dollars.
“The excellent coordination between federal, state, and local law enforcement agencies was critical in dismantling this group and so many others like them in 2015,” said Dana J. Boente, U.S. Attorney for the Eastern District of Virginia. “This case, and the resources and collaborative efforts used to investigate and prosecute it, is a prime example of the level of commitment and determination we have to combat the heroin crisis in the Commonwealth of Virginia.”
“This case demonstrates the severity and degree to which sophisticated drug operations try to profit off of the addiction, despair, and pain of others and threaten the safety of the communities where they operate,” said Mark R. Herring, Attorney General of Virginia. “This outcome demonstrates the power of collaboration and our combined resolve to fight the heroin epidemic that has affected so many people in our Commonwealth and throughout the country.”
Outten, along with six co-conspirators, were collectively sentenced to over 136 years in prison for their crimes. According to court documents, in the early morning hours of July 14, 2015, search warrants were executed simultaneously on 14 properties in Portsmouth, Chesapeake, and Suffolk, by more than 250 law enforcement officials from three states and the District of Columbia. When Jerald Outten was arrested, police recovered a loaded handgun with a bullet in the chamber, $1,700 in cash, 135 grams of raw heroin, marijuana, and a cutting agent used to increase the volume and profitability of heroin.
According to court documents, Jerald Outten, brother of ring-leader Alonzo Outten, personally managed the wholesale distribution of over 24 kilograms of heroin during the course of the conspiracy. He was often observed with a firearm during drug transactions. Jerald and Alonzo were responsible for supplying drugs to two violent Bloods gangs, Gorilla Mafira Piru and Imperial Gangsta Bloods (IGB), both of which have been dismantled, prosecuted, and sentenced. The IGB in particular was responsible for a number of violent acts in Portsmouth in 2014, including at least two shooting incidents with a rival drug trafficking organization that left homes of innocent citizens riddled with bullets. The IGB’s leader, Chris Smith, aka Killa, was sentenced to life in prison plus five years on Oct. 30, 2015. Gorilla Mafia Piru’s leader, Theodore Vann, aka Flatline, was sentenced to 16 years in prison Nov. 16, 2015.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Mark R. Herring, Attorney General of Virginia; and John S. Adams, Special Agent in Charge of the FBI’s Norfolk Field Office, made the announcement after sentencing by U.S. District Judge Mark S. Davis.
This case was investigated by the FBI’s Norfolk Field Office and the Chesapeake Police Department with the assistance of the Portsmouth Police Department, the Virginia State Police, and NCIS. Special Assistant U.S. Attorney John F. Butler, and Assistant U.S. Attorneys Joseph E. DePadilla and Andrew C. Bosse prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:15-cr-80 (Outten, et. al.); 2:15-cr-93 (Jackson); 2:15cr7 (Smith); and 2:15cr60 (Vann).
Name
Age, Hometown
Charges
Status
Alonzo Outten
35, Portsmouth
Conspiracy to Manufacture, Distribute, and Possess with Intent to Distribute Over One Kilogram of Heroin
Pleaded guilty July 30, 2015. Sentenced to 30 years on Nov. 4, 2015.
Jerald Outten
26, Portsmouth
Conspiracy to Manufacture, Distribute, and Possess with Intent to Distribute Over One Kilogram of Heroin
Pleaded guilty August 10, 2015. Sentenced to 22 years today.
Sherita Nicks
41, Brooklyn, New York
Conspiracy to Manufacture, Distribute, and Possess with Intent to Distribute Over One Hundred Grams of Heroin
Pleaded guilty Aug. 10, 2015. Sentenced to 18 years on Nov. 17, 2015.
Deyonta Hinton
31, Portsmouth
Conspiracy to Manufacture, Distribute, and Possess with Intent to Distribute Over One Kilogram of Heroin
Pleaded guilty Sept. 4, 2015. Sentenced to 22 years on Dec. 10, 2015.
Jermaine Jones
38, Portsmouth
Conspiracy to Manufacture, Distribute, and Possess with Intent to Distribute Over One Kilogram of Heroin
Pleaded guilty July 29, 2015. Sentenced to 22 years on Oct. 29, 2015.
Garnett Brown
34, Portsmouth
Conspiracy to Manufacture, Distribute, and Possess with Intent to Distribute Over One Kilogram of Heroin
Pleaded guilty July 29, 2015. Sentenced to 14 years on Nov. 10, 2015.
Latina Jackson
27, Portsmouth
Maintaining a Drug-Involved Premises
Pleaded guilty on July 27, 2015. Sentenced to 70 months on Nov. 5, 2015.
Troy Gay
24, Portsmouth
Conspiracy to Manufacture, Distribute, and Possess with Intent to Distribute Over One Hundred Grams of Heroin
Pleaded guilty on Aug. 6, 2015. Sentenced to 68 months on Nov. 5, 2015.
Ferriday woman sentenced to five months in prison for stealing Veterans Affairs benefitsRead the Press Release
ALEXANDRIA, La. – United States Attorney Stephanie A. Finley announced that a Ferriday woman was sentenced Thursday to five months in prison and five months of home confinement for stealing more than $100,000 of Veterans Affairs (VA) Death and Indemnity funds which were meant for her deceased aunt.
Linda Sue Bourgeois, 45, of Ferriday, La., was sentenced by U.S. District Judge Dee D. Drell on one count of theft of government property or funds. She was also sentenced to three years of supervised release and ordered to pay $107,452.33 restitution. According to evidence presented at her September 8, 2015 guilty plea, Bourgeois’ aunt was entitled to Death and Indemnity Compensation from the Department of Veterans Affairs because of her husband’s service in the military. Bourgeois’ aunt died in July of 2007, and Bourgeois did not inform Veterans Affairs of the death. Bourgeois and her aunt shared a bank account where the funds were deposited electronically, and Bourgeois took the funds until March 2015 when the payments terminated by the VA. Bourgeois stole $107,452.33 during the scheme.
Veterans Affairs, Office of Inspector General, conducted the investigation. Assistant U.S. Attorney Michael O’Mara prosecuted the case.
FCI Berlin Inmate Sentenced on Federal Weapon Possession ChargeRead the Press Release
CONCORD, N.H. – Randy Bragg, 45, an inmate at the Federal Correctional Institution in Berlin, New Hampshire, was sentenced in United States District Court for the District of New Hampshire on federal weapon possession charges, announced Acting United States Attorney Donald Feith. The Court imposed a term of nine months’ imprisonment, to be served consecutive to Bragg’s current prison sentence.
During a routine search in October 2014, correctional officers discovered on Bragg’s person a tooth-brush sharpened into a stabbing weapon. Acting United States Attorney Donald Feith stated, “We will continue to work with the Bureau of Prisons and the FBI to ensure the safety of BOP staff and the safety of inmates who we have been entrusted to its custody. Prosecutions such as this one should send a clear message that inmates found in possession of weapons can expect to be prosecuted and to serve additional time in prison.”
This prosecution arose from an investigation by the Federal Correctional Institution in Berlin, New Hampshire, in collaboration with the Federal Bureau of Investigation.
Extradited Chinese National Guilty of Supplying Iran with Goods Used to Make Nuclear Weapons-Grade UraniumRead the Press Release
BOSTON – A Chinese national pleaded guilty today in U.S. District Court in Boston in connection with supplying Iran with pressure transducers which could be used to make nuclear weapons-grade uranium.
Sihai Cheng, a/k/a Chun Hai Cheng, a/k/a Alex Cheng, 35, a citizen of the People’s Republic of China (PRC), pleaded guilty to two counts of conspiring to commit export violations and smuggle goods from the United States to Iran and four counts of illegally exporting U.S. manufactured pressure transducers to Iran. U.S. District Court Chief Judge Patti B. Saris scheduled sentencing for Jan. 27, 2016.
In 2013, Cheng was charged in an indictment along with Seyed Abolfazl Shahab Jamili, an Iranian national, and two Iranian companies, Nicaro Eng. Co., Ltd. (Nicaro) and Eyvaz Technic Manufacturing Company (Eyvaz), with conspiring to export, and exporting, highly sensitive U.S. manufactured goods with nuclear applications to Iran from at least 2009 to 2012. In December 2014, Cheng was extradited from the United Kingdom to this county and has remained in U.S. custody since then. Jamili remains a fugitive, and the U.S. government, through Interpol, has requested his arrest to face prosecution in the United States.
From February 2009 through at least 2011, Cheng, Jamili, and a third individual conspired with each other and others in the PRC and Iran to illegally obtain hundreds of U.S. manufactured pressure transducers manufactured by MKS Instruments, Inc., a company headquartered in Massachusetts, and export them to Iran. Pressure transducers can be used in gas centrifuges to enrich uranium and produce weapons-grade uranium and are therefore subject to strict export controls. They cannot be shipped from the United States to China without an export license or shipped from the United States to Iran at all. Today, Cheng admitted to causing the export of 185 pressure transducers from the United States to Iran in 2009.
Initially, the parts were exported to the PRC using fraudulently obtained U.S. Department of Commerce export licenses. When they arrived in the PRC, Cheng inspected them in the Shanghai Free Trade Zone and removed their U.S./MKS serial numbers to conceal the fact that he was violating U.S. law. Cheng then caused the MKS pressure transducers to be exported to Iran knowing that the parts were being supplied to the Government of Iran. Jamili advised Cheng that the Iranian end-user was Kalaye Electronic Company, which the U.S. Government designated as a proliferator of weapons of mass destruction in 2007 for its work with Iran’s nuclear centrifuge program.
MKS Instruments, Inc., is not a target of this investigation and has been cooperating in this matter.
The charging statutes provide a sentence of no greater than 20 years in prison on the charge of conspiracy to commit export violations and on each of the four counts of illegally exporting U.S. goods to Iran; and no greater than five years in prison on the charge of conspiracy to smuggle U.S. goods to Iran, in addition to five years of supervised release and a fine of $4 million. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Matthew Etre, Special Agent in Charge of Homeland Security Investigations in Boston; and John J. McKenna, Special Agent in Charge of the Department of Commerce, Office of Export Enforcement, Boston Field Office, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney B. Stephanie Siegmann of Ortiz’s National Security Unit.
Eighty Four, Pa., Man Charged with Receipt and Possession of Child PornographyRead the Press Release
PITTSBURGH - A Washington County resident has been indicted by a federal grand jury in Pittsburgh on a charge of receipt of material depicting the sexual exploitation of a minor, and a charge of possession of material depicting the sexual exploitation of a minor, United States Attorney David J. Hickton announced today.
The two-count indictment, returned on Dec. 16, named Michael G. Williams, 47, of Eighty Four, Pennsylvania, as the sole defendant.
According to the indictment, from on or about June 18, 2015, and continuing thereafter to on or about June 25, 2015, Williams knowingly received visual depictions, namely, videos and images in computer graphics and digital files, the production of which involved the use of a minor engaging in sexually explicit conduct. The indictment further charges that Williams, on July 15, 2015, unlawfully possessed in computer graphics files photographs and videos depicting minors engaged in sexually explicit conduct.
The law provides for a maximum total sentence of 30 years in prison, a fine of $500,000.00, or both. 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 defendant.
Assistant United States Attorney Jessica Lieber Smolar is prosecuting this case on behalf of the government.
The Office of the Pennsylvania Attorney General and the Federal Bureau of Investigation conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
East Bay CEO and Corporation Plead Guilty to $5.4 Million Wire Fraud ConspiracyRead the Press Release
OAKLAND – David Tung and Concord Farms, Inc. pleaded guilty in federal court in Oakland today to conspiracy to commit wire fraud and wire fraud, announced Acting United States Attorney Brian J. Stretch and U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Special Agent in Charge Ryan Spradlin.
In pleading guilty, Tung, 73, formerly of Hillsborough, admitted that while serving as Concord Farms’ Chief Executive Officer, he conspired to carry out a scheme to defraud the United States out of approximately $5.4 million of duties owed on imported items, namely produce items such as gourmet mushrooms. On its website, Concord Farms, based in Union City, once claimed to be one of the largest importers and growers of gourmet mushrooms in the United States, with multiple business locations operating in California and New York.
Duties are taxes assessed on the value of imported items. The duties accrue when the items arrive at a United States port of entry.
Tung and Concord Farms carried out the scheme by creating fraudulent invoices that undervalued Concord Farms’ imports and then caused those fraudulent invoices to be transmitted through unknowing customs brokers to the U.S. Customs and Border Protection (CBP), who relied on the invoices in assessing the amount of import duties owed by the defendants. In order to carry out part of the scheme, Tung conspired with a Concord Farms employee to use computer file templates and photocopy machines to create some of the fraudulent undervalued invoices that were transmitted to CBP. Through the scheme, Tung and Concord Farms were able to avoid the full payment of duties actually owed on the imported items since approximately 2001.
Tung and Concord Farms were indicted by a federal Grand Jury on January 29, 2015. They were charged with one count of conspiracy to commit wire fraud, in violation of 18 U.S.C. § 1349, and with ten counts of wire fraud, in violation of 18 U.S.C. § 1342. Under the plea agreement, Tung and Concord Farms pleaded guilty to conspiracy to commit wire fraud and to one substantive count of wire fraud.
Tung is currently released on a bond in the amount of $250,000.
The defendants’ sentencing hearing is scheduled for May 6, 2016, at 9:30 a.m. before the Honorable Jon S. Tigar, U.S. District Judge, in Oakland. Tung faces a maximum statutory penalty of 20 years in prison, and a fine of $250,000, plus restitution for each alleged violation of 18 U.S.C. § 1349 (conspiracy to commit wire fraud) and 18 U.S.C. § 1343 (wire fraud). Concord Farms faces a fine of $500,000 and five years of probation for each alleged violation. However, any sentence will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant U.S. Attorney Wade M. Rhyne is prosecuting the case with the assistance of Katie Turner and Noble Hughes. The prosecution is the result of an investigation by the Department of Homeland Security, Homeland Security Investigations.
District of Maine Selected as Phase II Anti-Trafficking Coordination TeamRead the Press Release
Contact: Julia M. Lipez
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced the selection of the District of Maine as one of only six federal Districts designated to participate in the Anti-Trafficking Coordination Team (ACTeam) Initiative, an interagency federal law enforcement initiative aimed at streamlining the investigation and prosecution of federal human trafficking offenses.
“Maine is a relatively small and rural state, but it is not immune from human trafficking issues,” said U.S. Attorney Delahanty. “They are a priority for our office and the District of Maine.” The ACTeam will consist of agents from the Federal Bureau of Investigation (“FBI”), the Department of Homeland Security’s Immigration and Customs Enforcement (“HSI”), the Department of Labor’s (“DOL”) Wage and Hour Division and Office of the Inspector General and two Assistant United States Attorneys (“AUSA”), one of whom will be Human Trafficking Coordinator, Julia M. Lipez. In 2014, HSI formed the Human Trafficking Task Force (“HTTF”) in Maine which consists of agents from federal, state and local law enforcement agencies. The ACTeam will enhance the efforts of the HTTF in Maine.
U.S. Attorney Delahanty’s announcement follows the joint announcement of Attorney General Loretta E. Lynch, Secretary of Homeland Security Jeh Johnson, and Secretary of Labor Thomas E. Perez yesterday designating the following cities as Phase II ACTeam sites: Cleveland, Ohio; Minneapolis, Minnesota; Newark, New Jersey; Portland, Maine; Portland, Oregon; and Sacramento, California. The sites were selected by unanimous interagency consensus of the Federal Enforcement Working Group, comprised of national anti-trafficking experts of the Department of Justice (“DOJ”), Civil Rights Division’s Human Trafficking Prosecution Unit, the Executive Office of United States Attorneys, the FBI, HSI, and DOL’s
Wage and Hour Division and Office of the Inspector General.ACTeams are aimed at developing high-impact human trafficking investigations and prosecutions involving forced labor, international sex trafficking, and sex trafficking of adults by force, fraud, and coercion, complementing Project Safe Childhood and related efforts aimed at combating child sexual exploitation, including child sex trafficking. ACTeams bring together federal prosecutors and federal agents from multiple federal investigative agencies to develop and implement proactive anti-trafficking case identification, investigation, and prosecution strategies in close coordination with one another and with national anti-trafficking subject matter experts.
During Phase I of the ACTeam Initiative, Phase I Pilot ACTeams were convened in Atlanta, Georgia; El Paso, Texas; Kansas City, Missouri; Los Angeles, California; Memphis, Tennessee; and Miami, Florida. Phase I proved highly successful, with ACTeam Districts collectively increasing prosecutions by 119%, compared to 35% nationwide during the same two-year period.
Based on the outstanding results of Phase I, Attorney General Lynch, Secretary of Homeland Security Johnson, and Secretary of Labor Perez launched Phase II on June 25, 2015 by soliciting joint applications from United States Attorneys’ Offices and their federal law enforcement partners nationwide.
“Human trafficking robs victims of their liberty, exploits them for labor and for sex, and infringes not only on their rights, but on their essential humanity,” said Attorney General Loretta Lynch. “Through the ACTeam Initiative, we are harnessing resources across the federal government to ensure that our multi-agency fight against human trafficking is as comprehensive and effective as possible. In the days and months ahead, the DOJ will continue to work alongside our federal partners to prosecute wrongdoing, support survivors, and bring this devastating crime to an end.”
“The ACTeam Initiative is an important tool in our collective ability to combat sex trafficking, forced labor and domestic servitude here in the United States,” said Secretary Jeh C. Johnson of Homeland Security. “It highlights our commitment to increase capacity to rescue victims and bring perpetrators of these terrible crimes to justice. Our collective efforts are amplified when we work together in furtherance of shared missions like this. And, through DHS’s Blue Campaign, we will remain focused on ending human trafficking in the United States.”
“A trafficking victim shouldn’t have to spend time trying to determine whether they have a DOL issue or a DOJ issue,” said Secretary Thomas Perez of the DOL. “Their basic rights are being violated, and we can accomplish so much more to redress those crimes when we work together. The Anti-Trafficking Coordination Team Initiative, by bringing our respective departments’ collective resources and expertise to bear, is helping us build a whole even greater than the sum of our individual parts.”
“Human trafficking is a modern day form of slavery that destroys lives and exploits the most vulnerable in our society,” said Director James B. Comey of the FBI. “These ACTeams are the most effective way to investigate human trafficking by allowing us to work in a collaborative, victim-oriented manner.”The Attorney General has declared efforts to bring human traffickers to justice and to restore the lives of human trafficking survivors be among the highest priorities of the DOJ.
District Man Sentenced to 39 Months in Prison for Improper Touching of 16-Year-Old GirlRead the Press Release
WASHINGTON – James Leroy Burney, 33, of Washington, D.C., was sentenced today to 39 months in prison after earlier pleading guilty to one count of sexual abuse of a minor, stemming from his fondling of a 16-year-old girl while she slept at her mother’s home, U.S. Attorney Channing D. Phillips announced.
Burney pled guilty in October 2015 in the Superior Court of the District of Columbia. He was sentenced by the Honorable Rhonda Reid Winston. After his prison term, he will be placed on 10 years of supervised release and will be required to register as a sex offender for 10 years.
According to the government’s evidence, on Aug. 13, 2015, the girl was spending the night with her mother, who she was visiting in Southeast Washington. Twice during the night, Burney slipped into a bedroom and fondled the girl. The Metropolitan Police Department (MPD) got a warrant for Burney’s arrest, and arrested him on Sept. 16, 2015.
In announcing the sentence, U.S. Attorney Phillips praised the work of MPD’s Youth Services Division, which 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 D’Yvonne Key and Joyce Arthur; Victim/Witness Advocate Veronica Vaughan; and La June Thames and Katina Adams-Washington, both of the Victim Witness Assistance Unit. Finally, U.S. Attorney Phillips commended Assistant U.S. Attorney Peter V. Taylor, who investigated and prosecuted this case.
District Man Sentenced to 18 Years in Prison for Attacking Woman at Her HomeRead the Press Release
WASHINGTON – Levi Ruffin, 37, of Washington, D.C., was sentenced today to 18 years in prison on charges stemming from a nighttime attack on a woman as she tried to enter her home in Northwest Washington, announced U.S. Attorney Channing D. Phillips.
Ruffin was found guilty in October 2015 by a jury of six counts: kidnapping while armed; third-degree sexual abuse while armed; first-degree burglary while armed; attempted robbery while armed; assault with a dangerous weapon, and assault causing significant bodily injury. The verdict was returned following a trial in the Superior Court of the District of Columbia. He was sentenced by the Honorable Rhonda Reid Winston. Upon completion of his prison term, Ruffin will be placed on 10 years of supervised release. He also will be required to register as a sex offender for 10 years and complete a mental health evaluation, sex offender treatment and therapy, and drug and alcohol treatment.
According to the government’s evidence, on Sept. 14, 2013, at about 9 p.m., the victim was entering the door to her home in the 6900 block of Georgia Avenue NW after an outing with her friends. As she entered the residence, she was rushed from behind by Ruffin, who placed his hand over her mouth. Ruffin pulled out a knife, placed it next to the woman’s face, and demanded she drop her belongings. Ruffin then forced her inside her home and demanded money. When the woman told Ruffin she had no money and attempted to give him her credit cards, Ruffin slapped the credit cards away and began to sexually assault her. The woman fought Ruffin when he touched her. During the fight, Ruffin cut the woman on both her hands and bit her face and back.
The bite marks on the woman’s face were swabbed for potential DNA. DNA was recovered from those bite marks and was traced to Ruffin. A warrant for Ruffin’s arrest was issued, and when Ruffin was arrested on Aug. 6, 2014, he was found to have generally matched the description the woman gave of the attacker. Ruffin also had a knife that matched the description provided by the woman of the knife used during the attack.
In announcing the sentence, U.S. Attorney Phillips commended the work of those who investigated the case from the Metropolitan Police Department. He also expressed appreciation for the assistance provided by the District of Columbia Department of Forensic Sciences and Bode Technologies. In addition, he acknowledged the efforts of those who handled the case for the U.S. Attorney’s Office, including Paralegal Specialists Mark Morse and Wanda Trice; Victim/Witness Advocate Veronica Vaughan; Litigation Technology Specialist Karen McColman; Criminal Investigators Nelson Rhone and Melissa Matthews; Legal Interns Emma McArthur and Meghan Monahan, and Michael Ambrosino, Special Counsel for DNA and Forensic Evidence Litigation. Finally, he commended the work of Assistant U.S. Attorneys Kenechukwu Okocha and Akhi Johnson, who prosecuted the matter, and Assistant U.S. Attorney Jodi Lazarus, who indicted the case.
District Man Pleads Guilty to Federal Charge for Series of Threats Against Metro Transit SystemRead the Press Release
WASHINGTON – Jerez Nehemiah Coleman, 20, of Washington, D.C., pled guilty today to a federal charge stemming from an investigation into a series of calls he made falsely warning of various threats to the Metro transit system, announced U.S. Attorney Channing D. Phillips and Ron Pavlik, Chief of the Metro Transit Police.
Coleman, also known as Kidd Cole and Jerez Nehemiah Stone-Coleman, was arrested on May 27, 2015 and has been in custody ever since. He pled guilty this afternoon in the U.S. District Court for the District of Columbia to a charge of making threats involving explosive materials. The Honorable Amit P. Mehta scheduled sentencing for Feb. 26, 2016. The charge carries a statutory maximum of 10 years in prison and potential financial penalties. The plea, which is subject to the Court’s approval, calls for a sentence of up to 27 months in prison, to be followed by two years of supervised release.
According to a statement of offense, signed by the defendant as well as the government, Coleman placed over 300 calls to 911 from December 2014 to May 2015. Multiple law enforcement agencies – including the Metro Transit Police, the Metropolitan Police Department (MPD), the FBI Joint Terrorism Task Force, the U.S. Capitol Police, and the U.S. Secret Service - responded to these calls and provided security at the various scenes. These threat and/or hoax calls caused law enforcement to spend hundreds of hours ensuring the public was safe.
In one such call, for example, made on Dec. 12, 2014, Coleman called 911 to report that he and his friends had bombs and were on a Metrobus at the Potomac Avenue Metro station in Southeast Washington. During the call, Coleman stated, “We are going to blow the entire whole bus…everybody is going to die in ten minutes…” This call prompted an immediate emergency response. MPD and Metro Transit Police were diverted from other duties and dispatched, emergency lights on and sirens blaring, to the scene. MPD arrived first and established a perimeter around the bus. There were about 20 passengers on board. When Metro Transit Police officers arrived, they evacuated the passengers. They searched each seat of the bus, the wheel wells, the undercarriage, and the exhaust pipes. Throughout this search, the bus was out of service. After the thorough investigation, police determined that the 911 call was a hoax.
“Jerez Nehemiah Coleman repeatedly disrupted our transit system and put people on edge by calling 911 with false threats of imminent attacks,” said U.S. Attorney Phillips. “Federal and local law enforcement immediately responded to these calls, putting aside other important responsibilities to investigate what turned out to be a hoax. Ultimately, the investigation led to this defendant, and now he is being held accountable for this series of senseless acts.”
“In today’s world, we must take every threat seriously,” said Metro Transit Police Chief Pavlik. “Over a period of several months, the defendant’s actions had the effect of putting at risk many Metro riders and responding police officers. I want to express my sincere gratitude for the efforts of our law enforcement partners on the Joint Terrorism Task Force, as well as the prosecutors who successfully handled this case.”
Coleman earlier was indicted by a federal grand jury on a total of 13 felony counts. In return for his guilty plea, the other charges will be dismissed at sentencing. In his plea today, he admitted to all of the conduct as alleged in the 13 charges.
In announcing the plea, U.S. Attorney Phillips and Metro Transit Police Chief Pavlik commended the work of those who investigated the case for the Metro Transit Police. They also expressed appreciation for the assistance provided by the Metropolitan Police Department, the 911 Office of Unified Communications, the FBI’s Washington Field Office, and other law enforcement agencies. They acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialists Jorge Casillas, Jessica Moffatt, and Todd McClelland and Criminal Investigator John Marsh. Finally, they commended Assistant U.S. Attorneys Deborah A. Curtis, John L. Hill and John Marston, who investigated and prosecuted the case.
Distributor for Large-Scale Drug Trafficking Organization Sentenced to 12 Years in PrisonRead the Press Release
TRENTON, N.J. – A Monmouth County, New Jersey, man was sentenced today to 144 months in prison for his role in a large-scale drug trafficking organization that distributed heroin in Ocean and Monmouth Counties, U.S. Attorney Paul J. Fishman announced.
Jason O’Neal, a/k/a “Born,” 43, of Farmingdale, New Jersey, previously pleaded guilty before U.S. District Judge Peter G. Sheridan to an information charging him with one count of conspiracy to distribute heroin. Judge Sheridan imposed the sentence today in Trenton federal court.
To date, 19 other alleged members or affiliates of the “Britt-Young Drug Trafficking Organization” – so named after its leaders, Rufus Young, a/k/a “Equan,” a/k/a “E-Money, and Robert Britt, a/k/a “True,” in the criminal complaint – have pleaded guilty to narcotics offenses.
According to documents filed in this case and statements made in court:
Between February 2013 and March 2014, O’Neal conspired with Rufus Young and others to distribute heroin in Ocean and Monmouth counties as part of the Britt-Young Drug Trafficking Organization. O’Neal admitted that he served as a supervisor and distributed between 100 and 400 grams of heroin in furtherance of the conspiracy.
In addition to the prison term, Judge Sheridan sentenced O’Neal to serve three years of supervised release.
U.S. Attorney Fishman credited special agents of the FBI, Red Bank Resident Office, under the direction of Special Agent in Charge Richard M. Frankel, with the investigation.
The government is represented by Assistant U.S. Attorney Nicholas Grippo of the U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel: Aidan P. O’Connor Esq., Hackensack, New Jersey
Detroit Resident Indicted for Planting Manufactured Explosive Devices in Yard to Protect Marijuana Grow OperationRead the Press Release
UPDATED: On March 3, 2021 the government moved, and the court ordered, that the indictment against Joshua Ragland be dismissed as a result of Mr. Ragland entering into the pre-trial diversion program.
A Detroit man was indicted on December 15, 2015, on charges of manufacturing and possessing destructive devices, which he strategically placed in his yard to protect his marijuana plants, United States Attorney Barbara L. McQuade announced today. Joining McQuade in the announcement was Special Agent in Charge Robin Shoemaker, Bureau of Alcohol, Tobacco, Firearms and Explosives. Joshua Ragland, 25, was indicted following a search that was conducted at his home in southwest Detroit. In September, law enforcement was called to investigate an explosion with injuries at the premises. The victim, a 29-year-old male, was walking across a vacant lot next to Ragland’s residence when he heard several explosions and felt pain in his foot. The victim was hospitalized, and released following treatment for his injuries. Upon searching the location, officers recovered five manufactured destructive devices, marijuana and marijuana plants and other materials, including a black gun powder substitute, which were used in the manufacture of the explosive bombs. Several firearms and ammunition were also recovered from the premises. The four-count indictment charges Ragland with Manufacture of Destructive Devices, Possession of Destructive Devices; Possession of Destructive Devices by Prohibited Person and Possession of Explosive Materials by Prohibited Person. An indictment is only a charge, and a defendant is presumed not guilty unless he is convicted at trial by a jury. If convicted on the charges in the indictment, Ragland faces penalties of up to 10 years’ imprisonment, a $250,000 fine, or both, as well as a 7-40 year term of imprisonment for manufacturing destructive devices causing physical injury to another. The case is being prosecuted by Assistant United States Attorney Susan Gillooly with the assistance of ATF, Detroit Field Division, the Detroit Police Department and Detroit Police Bomb Squad, the Michigan State Police Bomb Squad and the Dearborn Police Bomb Squad.
Defendant Receives 12 Month Sentence for Steroids ConspiracyRead the Press Release
United States Attorney Kenyen R. Brown of the Southern District of Alabama announced that Thomas Daniel Williams, 44, of Orange Beach, Alabama was sentenced today by U.S. District Judge Kristi K. DuBose to 6 months imprisonment followed by 6 months home confinement for conspiring to distribute steroids. The judge ordered that Williams undergo 3 years of supervised release upon completing his term of imprisonment, that he receive drug and anger management treatment while incarcerated, and that he pay a $100 mandatory special assessment.
On July 1, 2015, Williams was arrested on a federal criminal complaint alleging that Williams had unlawfully bought, used, and sold anabolic steroids, human growth hormone, and cocaine. The complaint’s affidavit alleged that Williams imported certain substances from China and that he was previously recorded selling steroids to a confidential human source. The affidavit also noted that in September 2014, the government had executed a search warrant at Williams’s home and found steroids and other incriminating evidence. On July 30, 2015, Williams was indicted by a federal grand jury on 17 counts of various drug-related offenses. On September 22, 2015, Williams pled guilty to 1 count of conspiring to distribute steroids.
The case was investigated by the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorneys Gregory Bordenkircher and Sinan Kalayoglu.
Dania Beach Businessman Convicted in Illegal Ivory Trafficking OperationRead the Press Release
A Dania Beach businessman pled guilty to trafficking in elephant ivory.
Wilfredo A. Ferrer, United States Attorney for the Southern District of Florida, Ed Grace, Deputy Assistant Director, U.S. Fish and Wildlife Service (FWS), Robert C. Hutchinson, Acting Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), Miami Field Office, and Delany E. De Leon-Colon, Acting Inspector in Charge, U.S. Postal Inspection Service (USPIS), made the announcement.
Raymond J. Reppert, Jr., 54, of Dania Beach, Florida, pled guilty today in U.S. District Court in Miami to knowingly making and causing to be made false records, accounts, labels for, and false identifications of wildlife, that is elephant ivory, by creating and causing to be created documents falsely identifying elephant ivory as resin carvings and wood samples, said elephant ivory having been and intended to be transported in interstate and foreign commerce, in violation of Title 16, United States Code, Sections 3372(d)(2) and 3373(d)(3)(A)(i), and Title 18, United States Code, Section 2. Reppert faces a maximum statutory sentence of 5 years’ imprisonment, up to three years of supervised release and a fine of up to $250,000. The defendant is scheduled to be sentenced in Miami before U.S. District Judge Kathleen M. Williams February 25, 2016.
According to court documents, including a joint factual proffer, Reppert was doing business as Raymie’s Commercial & Residential Moving (Raymies), a packing and shipping company specializing in antiques and located in Dania Beach, Florida,.
On February 14, 2014, U.S. Customs and Border Protection (CBP) officers at the Miami International Mail Facility identified a parcel being exported from the United States, which was referred to the Fish and Wildlife Service for inspection. An FWS Wildlife Inspector determined that the package, being mailed to Guangdong, China, contained elephant ivory. The sender listed a Dania, FL address. The accompanying Customs Declaration and Dispatch Note (Postal Service Form 2976-A) completed by the sender described the contents as “resin carvings” with a declared value of $60. The investigation revealed that the return address was invalid.
A search of a CBP database located over 245 matching records, including shipments from a post office in Pompano Beach, Florida. USPIS inspectors verified that the name and return addresses for those shipments were also false. The investigation revealed that a postal clerk knew the sender as “Raymie,” a regular customer who shipped parcels for other people as part of his business.
On February 20, 2014, CBP detained a second parcel consigned to the address in Guangdong, China. The customs declaration form described the item as a “resin carving” with a declared value of $60, however, FWS personnel identified and photographed the elephant ivory carving found in the parcel. The credit card sales receipt for the parcel was signed by Reppert and video footage captured the defendant dropping off the parcel at the post office.
Thereafter, between March 25 and April 22, 2014, the inter-agency team identified and inspected six additional export shipments originated by Reppert, each consigned to an address in China that was falsely labelled and documented as wood or resin carvings, when in fact they contained undeclared elephant ivory carvings.
Trade in elephant ivory is regulated under the Convention on International Trade in Endangered Species of Wild Fauna and Flora (“CITES”). CITES is a treaty providing protection to fish, wildlife and plants that are or could become imperiled due to the demands of international markets. CITES has been signed by over 170 countries including the United States. CITES is implemented in the United States through the Endangered Species Act (“ESA”). 16 U.S.C. § 1538(c); 50 C.F.R. §§ 14 and 23. An animal species listed as protected under CITES cannot be exported from the United States without prior notification to, and approval from, U.S. Fish and Wildlife Service. 50 C.F.R. §§ 20.13 and 20.20. Species protected under CITES are listed in a series of appendices (Appendices I, II and III), designating the level of protection afforded each species. Under Appendix II of CITES, a species can be exported from the United States to a foreign country only if, prior to exportation, the exporter possesses a valid CITES export permit issued by the United States. Under Appendix I of CITES, a species can only be exported from the United States if, prior to exportation, the exporter possesses a valid foreign import permit issued by the country of import and a valid export permit issued by the United States. The Asian elephant (Elephas maximus) is a species of elephant native to south-central and southeastern Asia. The Asian elephant is listed on Appendix I of CITES, and was listed as an endangered species in June 1976. 41 Fed. Reg. 24064. The African elephant (Loxodonta africana) is a species of elephant native to eastern and central Africa. The African elephant is listed in Appendix I of CITES, though certain populations of African elephants (specifically those from South Africa, Namibia, Botswana, and Zimbabwe) are listed in Appendix II, accompanied by a special annotation allowing only non-commercial international trade in specimens of those populations. The African elephant was listed as a threatened species under the ESA in May 1978. 43 Fed. Reg. 20504.
Mr. Ferrer commended the investigative efforts of the FWS, ICE-HSI, USPIS and CBP for their assistance with the investigation. This matter is being prosecuted by Assistant U.S. Attorney Thomas Watts-FitzGerald of the Economic & Environmental Crimes Section.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Dallas Man Sentenced to 20 Years in Federal Prison on Child Pornography ConvictionRead the Press Release
DALLAS — A 38-year-old Dallas resident, Rex Sistos, was sentenced this morning by U.S. District Judge Sidney A. Fitzwater to 240 months in federal prison following his guilty plea to one count of transportation of child pornography, announced U.S. Attorney John Parker of the Northern District of Texas.
According to documents filed in the case, the Dallas Police Department’s Internet Crimes Against Children (ICAC) unit received information from the National Center for Missing and Exploited Children (NCMEC) in September 2013 that Facebook had advised that a particular Facebook user, later identified as Sistos, had uploaded content that Facebook considered child pornography. The investigation led to the execution of a search warrant at Sistos’s home in Dallas on October 23, 2013.
During the execution of that warrant, Sistos was home and agreed to speak with an ICAC detective. Sistos admitted he used his cell phone to send an image of child pornography to an adult female located in the Philippines. A forensic analysis of the cell phone confirmed that Sistos had Facebook accounts associated with the image Sistos transported on two different occasions. Other images and videos of child pornography were also located on his phone.
The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about Internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
The Dallas Police Department’s ICAC and U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) investigated. Assistant U.S. Attorney Camille Sparks prosecuted.
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Corpus Christi Man Pleads Guilty to Distributing Child PornographyRead the Press Release
CORPUS CHRISTI, Texas – Billy Joe Moreno, 43, of Corpus Christi, has pleaded guilty to distribution of child pornography, announced U.S. Attorney Kenneth Magidson.
Today, the court heard that officers with the Corpus Christi Police Department (CCPD), while using peer-to-peer software, were able to successfully download various files containing child pornography from an IP address that was associated with Moreno. As a result of this information, Homeland Security Investigations (HSI) was contacted to assist in the investigation.
In July 2015, agents executed a search warrant at Moreno’s residence and seized a laptop computer. Forensic analysis on the computer revealed a total of 280 videos of child pornography. Moreno admitted to having downloaded child pornography for several years.
Senior U.S. District Judge Janis Graham Jack accepted the guilty plea today and set sentencing for Feb. 26, 2016. At that time, Moreno faces a minimum of five and up to 20 years in federal prison and a possible $250,000 maximum fine. Upon completion of any prison term imposed, Moreno also faces a maximum of life on supervised release during which time the court can impose a number of special conditions designed to protect children and prohibit the use of the Internet.
Moreno was arrested on the federal charges in October 2015 and has been in custody since that time where he will remain pending his sentencing.
The charges against Moreno were the result of an investigation conducted by the CCPD - Internet Crimes Against Children Task Force with the assistance of HSI.
This case, prosecuted by Assistant U.S. Attorney Hugo R. Martinez, 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."
Connecticut Man Sentenced to 13 Years for Crack Conspiracy and DistributionRead the Press Release
Contact: Julia M. Lipez
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced that Russell Gordon, 32, of Ansonia, Connecticut, was sentenced today in U.S. District Court by Judge George Z. Singal to 13 years in prison and five years of supervised release for conspiring to distribute cocaine base, often referred to as crack cocaine, and possession with intent to distribute crack cocaine. Gordon also was ordered to forfeit $10,706.50. He pleaded guilty to the charges
on May 29, 2015.Court records reveal that between December 2013 and January 2015, Gordon conspired with others to sell crack cocaine in Portland, Maine. Gordon would arrange for the acquisition of drugs out of state. Once the drugs were transported to Maine, they were provided to retail distributors who would sell the drugs in the Portland area, and then return the cash proceeds to Gordon. During the course of the investigation, law enforcement officers conducted controlled purchases of crack cocaine from members of the conspiracy. Gordon was arrested on January 9, 2015 at 66 Smith Street in Portland. At the time of his arrest, officers found him next to a bag containing 89 grams of crack cocaine and over $10,000 in cash.
Marco Gordon previously was sentenced to eleven years in connection with this conspiracy and Robert Joiner, Jr. and Samuel Collins each were sentenced to three years. Other defendants connected to this conspiracy have entered guilty pleas and await sentencing.
This case was investigated by the Southern Maine Gang Task Force, which is comprised of investigators from the Federal Bureau of Investigation; the Portland, South Portland, Biddeford and Lewiston Police Departments; U.S. Immigration and Customs Enforcement’s Homeland Security Investigations; the Bureau of Alcohol, Tobacco, Firearms and Explosives; and the U.S. Drug Enforcement Administration. The Maine Drug Enforcement Agency and the Maine State Police also assisted with the investigation.
The case also results from the ongoing effort of the Organized Crime Drug Enforcement Task Forces (OCDETF), a partnership between federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
Colorado Couple Sentenced in R.I. on Firearm ChargesRead the Press Release
PROVIDENCE, R.I. – Jessica Garrett, 32, and John Baker, 39, of Wiggins, Colo., have been sentenced to federal prison for being felons in possession of a firearm. The couple, previously convicted of felony crimes, was arrested by Central Falls, R.I., police in May 2015, after an investigation resulted in the seizure of a loaded semi-automatic assault rifle from a truck the couple was traveling in.
Jessica Garrett was sentenced yesterday to 36 months in federal prison. Baker was sentenced today to 46 months in federal prison. Garrett and Baker were also ordered to serve 3 years supervised release upon completion of their prison terms. Garrett and Baker pleaded guilty in September to being a felon in possession of a firearm.
The sentences, imposed by U.S. District Court Chief Judge William E. Smith, are announced by United States Attorney Peter F. Neronha and Central Falls Police Chief Colonel James J. Mendonca.
According to court records and information presented to the court, on May 13, 2015, Central Falls Police detectives developed information that a couple that recently arrived in Central Falls from Colorado was attempting to sell a firearm. The investigation determined that the firearm, a semi-automatic assault rifle, was being stored inside a pick-up truck in which the couple was traveling.
Later that evening, detectives approached the couple as they were attempting to enter the pick-up truck. John Baker was immediately detained. Jessica Garrett was apprehended as she attempted to flee. Inside Garrett’s handbag detectives found a magazine containing 12 rounds of rifle ammunition. During a court authorized search of the truck, which had Iowa license plates and that had recently been reported stolen in Colorado, detectives seized a loaded semi-automatic assault rifle with 28 rounds of ammunition. Baker and Garrett have been detained since their arrest.
The case was prosecuted by Assistant U.S. Attorney Lee H. Vilker.
ATF assisted Central Falls Police Department detectives in the investigation of this matter.
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Contact:
Jim Martin (401) 709-5357
email: [email protected]
on Twitter @USAO_RI
Colin Chisholm Indicted for Fraudulent Scheme to Steal More Than $2 Million from Investors in Television Network StartupRead the Press Release
United States Attorney Andrew M. Luger today announced the indictment of COLIN ALEXANDER CHISHOLM, 64, for stealing more than $2 million from investors by lying to them about an investment in a purported television network startup. CHISHOLM was indicted on seven counts of wire fraud and six counts of mail fraud. The defendant is expected to make an initial appearance today before Magistrate Judge Becky Thorson in U.S. District Court in St. Paul, Minn.
“According to the indictment, Mr. Chisholm claimed to have devised a creative and exciting investment opportunity,” said Assistant U.S. Attorney Lola Velazquez-Aguilu. “However, it was built on a series of lies. Instead of providing a real possibility for a return on their investment, this defendant is charged with victimizing those who entrusted their money to him. Thanks to the hard work of investigators from the Minnesota Department of Commerce and United States Postal Inspection Service, this defendant will now have to answer for his alleged crimes.”
“As the indictment alleges, Colin Chisholm told one lie after another to steal from investors who thought they were financing a promising new business enterprise,” said Minnesota Commerce Commissioner Mike Rothman. “In reality, Chisholm was using their money for his own personal enrichment and luxurious lifestyle. This case shows the Commerce Fraud Bureau’s continuing partnership with federal authorities to bring white-collar criminals to justice.”
Craig I. Goldberg, Postal Inspector in Charge of the Denver Division, which also covers the Twin Cities, said, “When the U.S. mail is alleged to have been used for the purposes of committing fraud, it’s the job of the Postal Inspection Service to aggressively investigate and ensure America’s continued confidence in the integrity of its postal system.”
“This case is yet another example of successful cooperation between federal and local law enforcement and prosecutors,” said U.S. Attorney Luger. “I am especially grateful to my colleagues and friends in the Hennepin County Attorney’s Office who referred this case for federal prosecution.”
According to the indictment and documents filed in court, since 2004, CHISHOM used The Caribbean Television Network, Inc., (TCN) an entity he formed purportedly to broadcast satellite television throughout the Caribbean, to solicit funds from investors. As part of the solicitation, CHISHOLM told potential investors that TCN would serve as a network for a group of cable television channels, thereby allowing advertisers to obtain advertising time on multiple channels via a single network advertising buy. Throughout the scheme, CHISHOLM told investors that TCN was on the verge of securing between $20 million and $100 million in funding to begin broadcasting, and that their investment would be used as interim financing for TCN.
According to the indictment and documents filed in court, as part of his scheme to obtain money from potential investors, CHISHOLM lied to them about the progress and viability of the main funding sources for TCN. CHISHOLM lied to some investors by telling them that they were buying shares of TCN stock owned by CHISHOLM’S alleged family trust – the Comar Trust and told some investors that their investments were guaranteed by the Comar Trust. In fact, the Comar Trust did not have funds to guarantee the investments.
According to the indictment and documents filed in court, CHISHOLM also lied to investors about his personal background. He told some investors that he was the grandson of Hugh J. Chisholm, Jr., and the son of William Chisholm, of the Oxford Paper Company. In falsely claiming this family lineage, CHISHOLM gave the false impression that he came from considerable family wealth. CHISHOLM also claimed to be a Scottish Chieftain of the Clam Chisholm and claimed to have close personal ties to members of the Bush family, specifically to Prescott S. Bush, Hr., the deceased brother of former President George H.W. Bush. CHISHOLM further claimed to provide scholarships to Bowdoin College, where Hugh J. Chisholm, Jr., received an honorary degree.
According to the indictment and documents filed in court, CHISHOLM also lied about his professional background, most notably making the claim to potential investors that he had worked as Vice President for Turner Program Services, to have a relationship with Ted Turner, and to have participated in the development and launch of CNN and CNN Headline News, including writing the business plan for CNN.
According to the indictment and documents filed in court, CHISHOLM also failed to disclose his own misuse of investor funds, including funds he used to satisfy a $255,500.50 settlement with Verizon and for personal expenses, such as the purchase of a yacht, personal fitness and wellness expenses, and rent for his home on Lake Minnetonka.
CHISOLM is charged with causing the loss of more than $2 million to individual investors.
This case is the result of an investigation conducted by the Minnesota Department of Commerce Fraud Bureau and the United States Postal Inspection Service.
The U.S. Attorney’s Office thanked the Hennepin County Attorney’s Office for its substantial assistance in this case.
This case is being prosecuted by Assistant United States Attorney Lola Velazquez-Aguilu.
Defendant Information:COLIN ALEXANDER CHISHOLM, 64
Minneapolis, Minn.Charges:
- Wire fraud, 7 counts
- Mail fraud, 6 counts
Cleveland man indicted for three bank robberiesRead the Press Release
A federal grand jury indicted Keith E. Bass, 20, of Cleveland, for the robberies of three separate banks in Northeast Ohio, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio.
The indictment alleges that on September 1, 2015, Bass entered the PNC Bank at 7101 Broadway Avenue, in Cleveland, and robbed the bank of $3,119. On September 9, 2015, Bass entered the First Merit Bank at 22595 Lakeshore Boulevard, in Euclid, and robbed the bank of $1,250. On November 9, 2015, Bass entered the Citizens Bank at 23300 Lakeshore Boulevard, in Euclid, and robbed the bank of $5,140, according to the indictment.
The Federal Bureau of Investigation conducted the investigation in conjunction with the Cleveland Police Department and the Euclid Police Department. The case is being prosecuted by Assistant United States Attorney Kevin R. Filiatraut.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial, in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Charlotte Man Sentenced to 12 Years in Prison for Bank Fraud SchemeRead the Press Release
CHARLOTTE, N.C. – Today, U.S. District Judge Robert J. Conrad, Jr. sentenced Jerry Lee Grier, Jr., 38, of Charlotte to 12 years in prison in connection with his scheme to defraud Wells Fargo Bank, N.A. (Wells Fargo) and for violating the terms of his supervised release, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. Grier, who pleaded guilty in June 2015 to one count of bank fraud, was also ordered to pay $100,800 in restitution to Wells Fargo and to serve five years of supervised release following his release from prison.
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.
According to filed court documents and court proceedings, from December 2014 through April 2015, Grier engaged in a scheme to defraud Wells Fargo by fraudulently obtaining customer account information and using such information to conduct unlawful cash withdrawals and transactions. According to court documents, after obtaining the customer account information, Grier would contact Wells Fargo bank tellers and other employees located in Charlotte and elsewhere via cell phone and use the sensitive customer account information to impersonate legitimate Wells Fargo customers, often falsely claiming to be seeking assistance in accessing and transferring cash to various accounts. Grier used a variety of lies to induce the unlawful transfer of monies, for example, by telling Wells Fargo employees that he was in urgent need for cash because of an emergency. According to court documents Grier was arrested after conducting one such fraudulent withdrawal of $22,000 at a Wells Fargo branch in Norfolk, Virginia.
In handing down the 12 year sentence, Judge Conrad noted that Grier’s criminal fraud history was “unmatched by any fraud defendant” seen by the Court and that such history reflected an “extraordinary pattern of fraudulent activity” that had been undeterred by prior prison sentences. Judge Conrad found that Grier’s three prior federal bank fraud convictions, in addition to today’s federal bank fraud conviction, coupled with the multitude of his other state fraud convictions, caused significant harm to victims and demonstrated Grier’s complete and utter disregard for the law. Judge Conrad stressed that a paramount consideration in determining the sentence was the need to protect the public from Grier’s further criminal activity.
Grier has been in federal custody since April 2015, when he was arrested for violating the terms of his supervised release arising from his 2011 federal bank fraud conviction. He will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
U.S. Attorney Rose credited the FBI for the investigation leading to today’s sentence.
Assistant U.S. Attorney Mark T. Odulio of the U.S. Attorney’s Office in Charlotte prosecuted the case.
Catahoula Parish man sentenced to 117 months in prison for explosives, firearms possession chargesRead the Press Release
ALEXANDRIA, La. – United States Attorney Stephanie A. Finley announced today that a Catahoula Parish man was sentenced to 117 months in prison for possessing unregistered explosives and illegally possessing firearms.
Bill W. Womack, 56, of Manifest, La., was sentenced by U.S. District Judge Dee D. Drell on one count of possessing unregistered explosive devices and one count of possessing a firearm in furtherance of drug trafficking. He was also sentenced to three years of supervised release, fined $50,000 and forfeited the weapons seized during the arrest. According to information presented at the September 24, 2015 guilty plea, agents seized machine guns, destructive devices, silencers, a short barreled rifle and more than a kilogram of marijuana. The weapons were not registered as required by law. In addition, law enforcement destroyed improvised explosive devices at the scene over a five-day period.
The ATF, FBI, Louisiana State Police and Catahoula Parish Sheriff’s Office investigated the case. Assistant U.S. Attorneys Seth D. Reeg and William J. Flanagan prosecuted the case.
Cartel Leader Extradited from Mexico to the Eastern District of New York to Face International Cocaine Trafficking ChargesRead the Press Release
Later today, Tirso Martinez-Sanchez will be arraigned at the federal courthouse in Brooklyn, New York, on charges that he was the head of an international drug cartel that imported tens of thousands of kilograms of cocaine into the United States from Mexico. Martinez-Sanchez was arrested in Mexico on February 2, 2014, based on a provisional arrest warrant issued from the Eastern District of New York. He was extradited from Mexico to the United States on December 17, 2015.
The charges were announced by Robert L. Capers, United States Attorney for the Eastern District of New York and Acting Special Agent in Charge, Glenn Sorge, U.S. Immigration and Customs Enforcement’s (ICE), Homeland Security Investigations (HSI), New York.
As alleged in the indictment and other court documents, Martinez-Sanchez was the leader of an extensive transnational narcotics importation, distribution, and transportation organization that is responsible for the importation and distribution of tens of thousands of kilograms of cocaine. In particular, the organization obtained multi-ton shipments of cocaine from Colombian sources of supply. Martinez-Sanchez then organized the importation of that cocaine from outside of the United States, into the United States, by using an elaborate transportation network of trains, tractor trailers, and other vehicles. Once the cocaine was in the United States, Martinez-Sanchez directed organization members to transport the cocaine overland to large distribution centers, including some areas located in the Los Angeles, New York, and Chicago metropolitan areas. Martinez-Sanchez directed organization members to coordinate the logistics of storing the cocaine in the organization’s stash warehouses and transporting the cocaine to the organization’s distributors and customers throughout New York and elsewhere in the United States, including California and Illinois.
The investigation further revealed that Martinez-Sanchez used a network of large warehouses to store and distribute the cocaine in the United States. Martinez-Sanchez directed members of the organization to establish and maintain numerous front companies to purchase or lease these stash warehouses and vehicles to transport cocaine, and to purchase “cover loads,” or legitimate goods that were stored and transported with the cocaine to mask the cocaine shipment.
Martinez-Sanchez also oversaw the collection of the organization’s proceeds from the sale of cocaine in the United States. After the cocaine was sold, the proceeds were collected and stored in the organization’s stash warehouses. At Martinez-Sanchez’s direction, the organization’s couriers smuggled some of the drug proceeds to organization members outside of the United States using the same transportation network of tractor trailers and trains that had been used to smuggle the cocaine into the United States. The investigation further revealed that Martinez-Sanchez invested a considerable amount of narcotics proceeds in money laundering ventures, such as the purchase of professional soccer teams, and a chain of high-end clothing boutiques. Martinez-Sanchez also invested the narcotics proceeds back into the instrumentalities of the organization itself, such as purchasing or leasing stash warehouses, vehicles, and front businesses.
Martinez-Sanchez had been designated a Consolidated Priority Organization Target or CPOT by the Organized Crime Drug Enforcement Task Force (OCDETF). In addition to coordinating the distribution of his own organization’s cocaine, Martinez-Sanchez also transported and distributed narcotics for members of other Mexican Drug Cartels, including the Sinaloa Cartel, led by CPOTs Joaquin “El Chapo” Guzman and Ismael “Mayo” Zambada; the Juarez Cartel, led by CPOT Vicente Carillo-Fuentes and the Beltran-Leyva Cartel, led by brothers Arturo, Hector and Alfredo Beltran-Leyva.
During the course of the investigation, law enforcement agents seized approximately 500 kilograms of cocaine from a residence in Deer Park, New York; approximately 2,000 kilograms of cocaine from a warehouse in Brooklyn, New York; approximately 2,000 kilograms of cocaine hidden inside a railroad car in Queens, New York; approximately 1,100 kilograms of cocaine from a warehouse in El Paso, Texas; and approximately 1,900 kilograms of cocaine from a warehouse in Chicago, Illinois.
“The charges announced today reflect our ongoing efforts to target and dismantle the largest drug trafficking organizations in the world, whose multi-billion dollar criminal networks funnel drugs onto our streets and spread violence into our communities,” said U.S. Attorney Capers. “We will continue to work together with our law enforcement partners in Mexico to root out the leaders of these insidious cartels wherever they may be found and bring them to justice.” Mr. Capers extended his grateful appreciation to the Department of Homeland Security, Homeland Security Investigations (HSI) New York Office, the agency responsible for leading the investigation, and to the invaluable assistance provided by the HSI Mexico Country Office, the Drug Enforcement Administration Task Force, the DEA Mexico Country Office and the Department of Justice’s Office of International Affairs.
“This is yet another example of HSI and its partners relentlessly pursuing and dismantling drug trafficking organizations from top to bottom,” said Glenn Sorge, acting special agent in charge HSI New York. “This team of agents and prosecutors are committed to stopping the flow of prohibited drugs into the United States, and accomplishing one of HSI's priorities to ensure public safety.”
The government’s case is being prosecuted by the Office’s International Narcotics and Money Laundering Section. Assistant United States Attorneys Steven L. Tiscione and Erik D. Paulsen are in charge of the prosecution.
The Defendants:
TIRSO MARTINEZ-SANCHEZ
Age: 51
MexicoE.D.N.Y. Docket No. 04-CR-874 (ERK)
Billy J. Williams Appointed to Serve as U.S. AttorneyRead the Press Release
PORTLAND, Ore. – Attorney General Loretta Lynch appointed Billy J. Williams as United States Attorney for the District of Oregon, effective on December 12, 2015. U.S. Attorney Williams will serve in an interim capacity pursuant to the Attorney General's authority to appoint under 28 U.S.C. Section 546.
Billy Williams has served as the Acting United States Attorney, for the District of Oregon since May of 2015. He has been with the U.S. Attorney’s Office since October of 2000. Prior to his role as Acting United States Attorney, he served as the First Assistant, Chief of the Criminal Division, Chief of the Violent Crimes Unit, and as the Indian Country AUSA/Tribal Liaison.
Prior to his federal service, Williams served as a Sr. Deputy District Attorney in Multnomah County, where he supervised the Career Criminal Unit, and over his career prosecuted major crimes of violence, including aggravated murder, adult and child sex offenses, domestic violence, narcotics trafficking, vehicular homicide crimes, as well as investigations of officer-involved shootings.
Williams received his law degree in 1989 at the Willamette University College of Law.
Baltimore Man Indicted for Insurance Fraud Scheme Involving Arson and for His Efforts to Cover up the Scheme, Including Attempted Witness TamperingRead the Press Release
Baltimore, Maryland – A federal grand jury indicted Greg Ramsey, age 54, of Baltimore, with conspiracy to commit wire fraud, use of a fire to commit a federal felony, malicious destruction of property by fire, attempted witness tampering, and related gun charges. Ramsey and his niece, Tyesha Towanda Roberts, age 37, also of Baltimore, are charged with attempting to obstruct a federal investigation. The indictment was returned late on December 17, 2015.
The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge William P. McMullan of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; Commissioner Kevin Davis of the Baltimore Police Department; Maryland State Fire Marshal Brian Geraci; and Anne Arundel County Fire Department Deputy Chief Scott Hoglander.
According to the 12-count indictment, Ramsey and a co-conspirator, J.R., agreed to commit a series of arsons. On October 28, 2012, Ramsey and J.R. traveled to the Pennsylvania residence of J.R.’s business associate, with whom J.R. was having a dispute, and set the residence on fire. At the time, the residence was occupied. The fire caused extensive damage to the residence.
Further, the indictment alleges that Ramsey agreed to set fire to residences on Clifton Avenue and Walbrook Avenue, as well as two vehicles, all of which were owned by J.R., in order to obtain money on the insurance policies. The indictment alleges that on February 17, 2013, Ramsey deliberately set the Clifton Avenue residence on fire. At the time the fire was set, the residence was occupied by tenants. The fire caused extensive damage to the residence.
On August 26, 2013, after Ramsey and J.R. moved the vehicles to the 2700 block of Walbrook Avenue, Ramsey and J.R. allegedly set the Walbrook Avenue property and the vehicles on fire. The fire at the Walbrook Avenue property not only caused extensive damage to the building, but spread to the neighboring homes. Both vehicles were completely destroyed and those fires spread to a nearby church, located at 1925 N. Dukeland Street in Baltimore, causing extensive damage to that building.
On February 19, 2013, J.R. reported the loss due to fire damage at the Clifton Avenue residence to the insurance company, which issued a check for $50,000 to J.R. and the mortgage holder. After the mortgage and other debts were paid off, the mortgage holder wrote J.R. a check for the balance, approximately $10,000. After the fires on August 26, 2013, J.R. contacted the insurance companies for the vehicles and the Walbrook Avenue property to begin the insurance claims process, which continued by telephone and email, although neither insurer paid the claims.
Unbeknownst to Ramsey, on May 29, 2015, J.R. pleaded guilty to the insurance fraud scheme and the arsons. According to the indictment, on September 14, 2015, Ramsey and J.R. had a detailed discussion about certain evidence at the co-conspirator’s upcoming trial. Ramsey offered to have his “sister,” Roberts, falsely testify that J.R. was visiting her at her house in the vicinity of Walbrook Avenue as an explanation for why J.R. was in the area near the date and time the fires were set. During that discussion, Ramsey also allegedly offered to have someone to kill a witness who would testify for the prosecution. Ramsey and J.R. had additional discussions regarding Ramsey’s offer for Roberts to falsely testify on behalf of J.R. The indictment alleges that Roberts confirmed that she was willing to offer false testimony, and took $1,000 from a confidential source as an initial payment. After that meeting Ramsey again brought up with the confidential source the possibility of getting money to pay an individual who was willing to murder a witness who was prepared to testify for the prosecution. On November 2, 2015, Ramsey and Roberts met with J.R. to discuss the particulars of Roberts’ false testimony. During a discussion about possibly killing any witness testifying for the prosecution, Roberts offered that she knew people who would be willing to commit such a murder.
The indictment alleges that on November 6, 2015, the confidential source introduced Ramsey to an undercover law enforcement officer (UC) to discuss Ramsey’s offer involving murdering a witness for a fee. On November 13, 2014, Ramsey allegedly met with the UC and accepted $2,000 towards the $10,000 total fee that had been agreed upon for murdering a witness. Ramsey then directed the UC to his residence where he retrieved a loaded .357 revolver, to be used to murder the witness.
Ramsey faces a maximum of 20 years in prison for the wire fraud conspiracy; a maximum of 10 years in prison for one count of use of a fire to commit a federal felony and 20 years in prison, consecutive to any other sentence, for each of the two other counts; a mandatory minimum sentence of five years and up to 20 years in prison for each of four counts of malicious destruction of property by fire; a maximum of 30 years in prison for attempted witness tampering; a mandatory minimum of five years and up to life in prison for possession of a firearm in furtherance of a crime of violence; and a maximum of 10 years in prison for being a felon in possession of a firearm and ammunition. Ramsey and Roberts each face a maximum sentence of 20 years in prison for attempting to obstruct a federal investigation. Ramsey and Roberts were both arrested on related charges on November 13 and November 18, 2015, respectively. Ramsey remains detained. Roberts is under the supervision of U.S. Pretrial Services. An initial appearance on this indictment has not 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.
United States Attorney Rod J. Rosenstein praised the ATF, Baltimore Police Department, Maryland State Fire Marshal’s Office and Anne Arundel County Fire Department for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Judson T. Mihok and Zachary A. Myers, who are prosecuting the case.
Aurora Gangster Found Guilty of Being a Felon in Possession of a FirearmRead the Press Release
DENVER – David Scott, age 24, of Aurora, Colorado, a known member of the Crenshaw Mafia Gangster 104th Park Hill Blood gang, was found guilty today of being a felon in possession of a firearm, following a four-day jury trial before Chief U.S. District Court Judge Marcia S. Krieger, U.S. Attorney John Walsh and Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Special Agent in Charge Ken Croke announced. Scott was indicted by a federal grand jury in Denver on January 27, 2015. He is scheduled to be sentenced on March 28, 2016. The defendant, who appeared at the trial in custody, was remanded at the conclusion.
According to the facts presented at trial, Scott, a known felon, was one of three known gang members inside a vehicle on December 31, 2012, that was stopped by the Aurora Police Department after multiple traffic violations were observed. After a search of the vehicle, a .45 caliber semi-automatic handgun was found under Scott’s seat wrapped in a red bandana. Scott is a Blood gang member. During the trial, a DNA expert testified that Scott’s DNA was found on the weapon. Scott had multiple prior convictions in Colorado for felony crimes, including a 2010 Denver District Court conviction for possession of a weapon by a previous offender, a 2009 Arapahoe County District Court conviction for felony menacing, and a 2013 conviction in U.S. District Court in Colorado for being a felon in possession of a firearm.
“Today’s guilty verdict against a violent gang member, a felon caught with a firearm, is a victory for the citizens of Metro Denver,” said U.S. Attorney John Walsh. “Thanks to the hard work of the jury in this case, who made a thorough review of the evidence, Defendant Scott will be off the streets and our community will be safer.”
“Scott is an extremely dangerous felon with a long criminal history,” said ATF Denver Field Division Special Agent in Charge Ken Croke. “Working with the U.S. Attorney’s Office, the government is going to advocate for the longest possible sentence possible for his relentless violence.”
Scott faces up to 10 years in federal prison, and not more than a $250,000 fine for being a felon in possession of a firearm.
This case was investigated by the Aurora Police Department and the ATF Denver Field Division.
The defendant was prosecuted by Assistant U.S. Attorneys Jeremy Sibert and Rebecca Weber.
Audubon County Man Sentenced to Prison for Role in Conspiracy to Distribute MethamphetamineRead the Press Release
COUNCIL BLUFFS, IA – On December 17, 2015, Brock Daniel Knapp, 27, of Exira, Iowa, was sentenced by Chief United States District Court Judge John A. Jarvey to 12 months and a day in prison for conspiring to distribute methamphetamine, announced Acting United States Attorney Kevin E. VanderSchel. Knapp was also ordered to serve three years of supervised release following his prison term.
According to the plea agreement, beginning in June of 2014, Knapp assisted in the distribution of methamphetamine by delivering money from the sale of methamphetamine to methamphetamine suppliers involved in the conspiracy.
This matter was investigated by the Iowa Department of Public Safety, Division of Narcotics Enforcement, and the case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
Anne Arundel County Man Sentenced to 188 Months in Prison for Production of Child PornographyRead the Press Release
Baltimore, Maryland – Chief U.S. District Judge Catherine C. Blake sentenced Jason Carpenski, age 28, of Brooklyn, Maryland, today to 188 months in prison, followed by lifetime supervised release, for production of child pornography. Chief Judge Blake ordered that upon his release from prison, Carpenski must register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation - Baltimore; Assistant Director in Charge Paul M. Abbate of the Federal Bureau of Investigation - Washington Field Office; and Anne Arundel County Police Chief Tim Altomare.
According to Carpenski’s plea agreement, on July 28, 2014, Carpenski responded to an internet advertisement placed by an undercover FBI Task Force Officer in Washington, D.C.. Over the next two days Carpenski discussed with the undercover officer in on-line and telephone communications his interest in images and activities involving sexual contact between adult males and their young, prepubescent daughters. Carpenski told the undercover officer that he had access to two prepubescent girls and described sexual contact he had with both of them. Carpenski sent the undercover officer a sexually explicit image that Carpenski had taken documenting his sexual abuse of one of the girls.
On August 5, 2015, a search warrant was executed at Carpenski’s residence. Carpenski admitted that he utilized his cell phone to access the internet and communicate online. Carpenski admitted taking sexually explicit images and inappropriately touching Victim One, who was younger than eight years old at the time of the conduct. Carpenski also admitted sending some of the images he had taken of Victim One to individuals in other states and countries. A search of Carpenski’s email account and forensic examination of his phone recovered over 500 images and four video files depicting prepubescent children engaged in sexually explicit conduct. Some of those images had also been emailed to others.
The case was investigated by the FBI-led Maryland Child Exploitation Task Force (MCETF), created in 2010 to combat child prostitution, with members from10 state and federal law enforcement agencies. The Task Force coordinates with the National Center for Missing and Exploited Children and the Maryland State Police Child Recovery Unit to identify children who are being sexually exploited, and missing children being advertised online for prostitution.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc. For more information about internet safety education, please visit www.justice.gov/psc and click on the "resources" tab on the left of the page.
United States Attorney Rod J. Rosenstein commended the FBI’s Baltimore and Washington Field Offices, and the Anne Arundel County Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Tamera L. Fine, who prosecuted the case.
Amherst Man Pleads Guilty to Child Pornography ChargesRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
BUFFALO, N.Y. – U.S. Attorney William J. Hochul, Jr. announced today that Matthew Bordonard, 26, of Amherst, NY, pleaded guilty before Chief U.S. District Frank P. Geraci to possession of child pornography. The charge carries a maximum penalty of 10 years in prison and a fine of $250,000.Assistant U.S. Attorney Marie P. Grisanti, who is handling the case, stated that on June 4, 2013, a search warrant was executed at the defendant’s residence. Law enforcement officers seized computers, hard drives and other electronic items. A forensic analysis determined that Bordonard’s laptop computer contained more than 340 images and video files containing child pornography including graphic images and videos of children under the age of 12 years old.
The plea is the culmination of an investigation by the Federal Bureau of Investigation Child Exploitation Task Force, under the direction of Special Agent in Charge Adam S. Cohen. The task force includes the Buffalo Police Department, Cheektowaga Police Department, and Niagara County Sheriff’s Office.
Sentencing is scheduled for March 18, 2015, at 2:30 p.m. before Judge Geraci.
32 Hospitals to Pay U.S. More Than $28 Million to Resolve False Claims Act Allegations Related to Kyphoplasty BillingRead the Press Release
Thirty-two hospitals located throughout 15 states have agreed to pay the United States a total of more than $28 million to settle allegations that the health care facilities submitted false claims to Medicare for minimally-invasive kyphoplasty procedures, the Justice Department announced today. The Justice Department has now reached settlements with more than 130 hospitals totaling approximately $105 million to resolve allegations that they mischarged Medicare for kyphoplasty procedures.
Kyphoplasty is a minimally-invasive procedure used to treat certain spinal fractures that often are due to osteoporosis. In many cases, the procedure can be performed safely and effectively as an outpatient procedure without any need for a more costly inpatient hospital admission. The settlements announced today resolve allegations that the 32 settling hospitals frequently billed Medicare for kyphoplasty procedures on a more costly inpatient basis, rather than an outpatient basis, in order to increase their Medicare billings.
“Charging the government for higher cost inpatient services that patients do not need wastes the country’s vital health care dollars,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “The Department of Justice is committed to ensuring that Medicare funds are expended appropriately, based on the medical needs of patients rather than the desire to maximize hospital profits.”
The settling facilities and the amounts they have agreed to pay, include the following:
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The Cleveland Clinic in Cleveland, Ohio, has agreed to pay $1.74 million.
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Citrus Memorial Health System in Inverness, Florida, has agreed to pay $2.6 million.
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Cullman Regional Medical Center in Cullman, Alabama, has agreed to pay $350,000.
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Martin Memorial Medical Center in Stuart, Florida, has agreed to pay $2 million.
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MultiCare Tacoma General Hospital in Tacoma, Washington, has agreed to pay $983,000.
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Norwalk Hospital in Norwalk, Connecticut, has agreed to pay $920,000.
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Princeton Community Hospital Association in Princeton, West Virginia, has agreed to pay $1,513,500.
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Sacred Heart Medical Center in Spokane, Washington, has agreed to pay $906,000.
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Sarasota Memorial Hospital in Sarasota, Florida, has agreed to pay $972,000.
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Spartanburg Regional Health Services District Inc. in Spartanburg, South Carolina, has agreed to pay $1.725 million.
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St. Cloud Hospital in St. Cloud, Minnesota, has agreed to pay $500,000.
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Tampa General Hospital in Tampa, Florida, has agreed to pay $2 million.
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Five hospitals affiliated with Community Health Systems Inc., in Franklin, Tennessee, have agreed to pay a total of $3.5 million.These include:Crestwood Medical Center in Huntsville, Alabama; St. Joseph’s Hospital in Fort Wayne, Indiana; Carolinas Hospital System in Florence, South Carolina; Mary Black Health System in Spartanburg, South Carolina; and Trinity Medical Center in Birmingham, Alabama.
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Five hospitals affiliated with Tenet Health Care Corporation in Dallas, Texas, have agreed to pay a total of $2.2 million. These include:East Cooper Medical Center in Mt. Pleasant, South Carolina; North Fulton Hospital in Roswell, Georgia; Providence Memorial Hospital in El Paso, Texas; St. Francis Hospital in Memphis, Tennessee; and Sierra Medical Center in El Paso.
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Five hospitals formerly owned and operated by Health Management Associates Inc., in Naples, Florida, have agreed to pay a total of $2 million.These include:Biloxi Regional Medical Center in Biloxi, Mississippi; Davis Regional Medical Center in Statesville, North Carolina; Lancaster Regional Medical Center in Lancaster, Pennsylvania; Physicians Regional Medical Center in Naples, Florida; and Riley Hospital in Meridian, Mississippi.
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Three hospitals affiliated with BayCare Health System in Clearwater, Florida, have agreed to pay a total of $1.5 million.These include:Winter Haven Hospital in Winter Haven, Florida; St. Joseph’s Hospital in Tampa, Florida; and St. Anthony’s Hospital in St. Petersburg, Florida.
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Two hospitals affiliated with Banner Health in Phoenix, Arizona, have agreed to pay a total of $2.685 million.These include Banner Boswell Medical Center in Sun City, Arizona, and Banner Thunderbird Medical Center in Glendale, Arizona.
“As has been shown throughout this successful investigation, we will never allow hospitals to put profits ahead of patients,” said U.S. Attorney William J. Hochul Jr. of the Western District of New York. “Decisions regarding potential procedures should be made using sound medical judgment only, not with an eye toward increasing Medicare reimbursements. The public should be assured that any hospital involved in improper kyphoplasty billing will be held accountable for its actions.”
In addition to settlements with over 130 hospitals, the government previously settled with Medtronic Spine LLC, the corporate successor to Kyphon Inc., for $75 million to settle allegations that the company caused false claims to be submitted to Medicare by counseling hospital providers to perform kyphoplasty procedures as inpatient rather than outpatient procedures.
All but three of the settling facilities announced today were named as defendants in a qui tam, or whistleblower, lawsuit brought under the False Claims Act, which permits private citizens to bring lawsuits on behalf of the United States and receive a portion of the proceeds of any settlement or judgment awarded against a defendant. The lawsuit was filed in federal district court in Buffalo, New York, by Craig Patrick and Charles Bates. Patrick is a former reimbursement manager for Kyphon, and Bates was formerly a regional sales manager for Kyphon in Birmingham. The whistleblowers will receive a total of approximately $4.75 million from the settlements announced today.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $26.7 billion through False Claims Act cases, with more than $16.8 billion of that amount recovered in cases involving fraud against federal health care programs.
The settlements were the result of a coordinated effort among the U.S. Attorney’s Office for the Western District of New York, the Civil Division’s Commercial Litigation Branch and the Department of Health and Human Services’ Office of Inspector General and Office of Counsel to the Inspector General.
The claims resolved by these settlements are allegations only, and there have been no determinations of liability.
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32 Hospitals to Pay U.S. More Than $28 Million to Resolve False Claims Act Allegations Related to Kyphoplasty BillingRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051BUFFALO – Thirty-two hospitals located throughout 15 states have agreed to pay the United States a total of more than $28 million to settle allegations that the health care facilities submitted false claims to Medicare for minimally-invasive kyphoplasty procedures, the Justice Department announced today. The Justice Department has now reached settlements with more than 130 hospitals totaling approximately $105 million to resolve allegations that they mischarged Medicare for kyphoplasty procedures.
Kyphoplasty is a minimally-invasive procedure used to treat certain spinal fractures that often are due to osteoporosis. In many cases, the procedure can be performed safely and effectively as an outpatient procedure without any need for a more costly inpatient hospital admission. The settlements announced today resolve allegations that the 32 settling hospitals frequently billed Medicare for kyphoplasty procedures on a more costly inpatient basis, rather than an outpatient basis, in order to increase their Medicare billings.
“As has been shown throughout this successful investigation, we will never allow hospitals to put profits ahead of patients,” said U.S. Attorney William J. Hochul Jr. of the Western District of New York. “Decisions regarding potential procedures should be made using sound medical judgment only, not with an eye toward increasing Medicare reimbursements. The public should be assured that any hospital involved in improper kyphoplasty billing will be held accountable for its actions.”
“Charging the government for higher cost inpatient services that patients do not need wastes the country’s vital health care dollars,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “The Department of Justice is committed to ensuring that Medicare funds are expended appropriately, based on the medical needs of patients rather than the desire to maximize hospital profits.”
The settling facilities and the amounts they have agreed to pay, include the following:
• The Cleveland Clinic in Cleveland, Ohio, has agreed to pay $1.74 million.
• Citrus Memorial Health System in Inverness, Florida, has agreed to pay $2.6 million.
• Cullman Regional Medical Center in Cullman, Alabama, has agreed to pay $350,000.
• Martin Memorial Medical Center in Stuart, Florida, has agreed to pay $2 million.
• MultiCare Tacoma General Hospital in Tacoma, Washington, has agreed to pay $983,000.
• Norwalk Hospital in Norwalk, Connecticut, has agreed to pay $920,000.
• Princeton Community Hospital Association in Princeton, West Virginia, has agreed to pay $1,513,500.
• Sacred Heart Medical Center in Spokane, Washington, has agreed to pay $906,000.
• Sarasota Memorial Hospital in Sarasota, Florida, has agreed to pay $972,000.
• Spartanburg Regional Health Services District Inc. in Spartanburg, South Carolina, has agreed to pay $1.725 million.
• St. Cloud Hospital in St. Cloud, Minnesota, has agreed to pay $500,000.
• Tampa General Hospital in Tampa, Florida, has agreed to pay $2 million.
• Five hospitals affiliated with Community Health Systems Inc., in Franklin, Tennessee, have agreed to pay a total of $3.5 million. These include: Crestwood Medical Center in Huntsville, Alabama; St. Joseph’s Hospital in Fort Wayne, Indiana; Carolinas Hospital System in Florence, South Carolina; Mary Black Health System in Spartanburg, South Carolina; and Trinity Medical Center in Birmingham, Alabama.
• Five hospitals affiliated with Tenet Health Care Corporation in Dallas, Texas, have agreed to pay a total of $2.2 million. These include: East Cooper Medical Center in Mt. Pleasant, South Carolina; North Fulton Hospital in Roswell, Georgia; Providence Memorial Hospital in El Paso, Texas; St. Francis Hospital in Memphis, Tennessee; and Sierra Medical Center in El Paso.
• Five hospitals formerly owned and operated by Health Management Associates Inc., in Naples, Florida, have agreed to pay a total of $2 million. These include: Biloxi Regional Medical Center in Biloxi, Mississippi; Davis Regional Medical Center in Statesville, North Carolina; Lancaster Regional Medical Center in Lancaster, Pennsylvania; Physicians Regional Medical Center in Naples, Florida; and Riley Hospital in Meridian, Mississippi.
• Three hospitals affiliated with BayCare Health System in Clearwater, Florida, have agreed to pay a total of $1.5 million. These include: Winter Haven Hospital in Winter Haven, Florida; St. Joseph’s Hospital in Tampa, Florida; and St. Anthony’s Hospital in St. Petersburg, Florida.
• Two hospitals affiliated with Banner Health in Phoenix, Arizona, have agreed to pay a total of $2.685 million. These include Banner Boswell Medical Center in Sun City, Arizona, and Banner Thunderbird Medical Center in Glendale, Arizona.In addition to settlements with over 130 hospitals, the government previously settled with Medtronic Spine LLC, the corporate successor to Kyphon Inc., for $75 million to settle allegations that the company caused false claims to be submitted to Medicare by counseling hospital providers to perform kyphoplasty procedures as inpatient rather than outpatient procedures.
All but three of the settling facilities announced today were named as defendants in a qui tam, or whistleblower, lawsuit brought under the False Claims Act, which permits private citizens to bring lawsuits on behalf of the United States and receive a portion of the proceeds of any settlement or judgment awarded against a defendant. The lawsuit was filed in federal district court in Buffalo, New York, by Craig Patrick and Charles Bates. Patrick is a former reimbursement manager for Kyphon, and Bates was formerly a regional sales manager for Kyphon in Birmingham. The whistleblowers will receive a total of approximately $4.75 million from the settlements announced today.This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $26.7 billion through False Claims Act cases, with more than $16.8 billion of that amount recovered in cases involving fraud against federal health care programs.
The settlements were the result of a coordinated effort among the U.S. Attorney’s Office for the Western District of New York, the Civil Division’s Commercial Litigation Branch and the Department of Health and Human Services’ Office of Inspector General and Office of Counsel to the Inspector General.
The claims resolved by these settlements are allegations only, and there have been no determinations of liability.
21st Century Oncology to Pay $19.75 Million to Settle Alleged False Claims for Unnecessary Laboratory TestsRead the Press Release
21st Century Oncology LLC, has agreed to pay $19.75 million to the government to resolve allegations that it violated the False Claims Act by billing federal health care programs for laboratory tests that were not medically necessary, the Justice Department announced today. 21st Century is a nationwide provider of integrated cancer care services that is headquartered in Fort Myers, Florida.
“Today’s settlement demonstrates our unwavering commitment to protect the Medicare trust fund against unscrupulous providers,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “Providers who waste taxpayer dollars by billing for unnecessary services will face serious consequences.”
The settlement announced today resolves allegations that 21st Century submitted claims to Medicare and Tricare for fluorescence in situ hybridization, or “FISH,” tests that were not medically necessary. FISH tests are laboratory tests performed on urine that can detect genetic abnormalities associated with bladder cancer. The government alleged that 21st Century submitted claims for unnecessary FISH tests that were ordered by four of its urologists, Dr. Meir Daller, Dr. Steven Paletsky, Dr. David Spellberg and Dr. Robert Scappa, all of whom practiced in the Fort Myers area. The government also alleged that 21st Century encouraged these physicians to order unnecessary FISH tests by offering bonuses that were based in part on the number of tests referred to 21st Century’s laboratory. Today’s settlement resolves the civil liability of 21st Century only.
“Charging the government for clearly unnecessary medical services squanders taxpayer dollars,” said U.S. Attorney A. Lee Bentley, III of the Middle District of Florida. “Our office will continue to pursue health care providers who defraud the United States, thereby threatening the viability of government health care programs, such as Medicare.”
“These tests were ordered to increase profits, not improve the healthcare of patients,” said Special Agent in Charge Shimon Richmond of the Department of Health and Human Services Office of Inspector General (HHS-OIG). “This kind of unvarnished fraud is an attack on Medicare by unscrupulous providers and the OIG and its federal partners will take whatever steps are necessary to stop them.”
“This settlement demonstrates the commitment of the Defense Criminal Investigative Service (DCIS) and its law enforcement partners to protect the integrity of the U.S. military health care program (TRICARE) against fraudulent claims for medical services, said Special Agent in Charge John F. Khin of DCIS’s Southeast Field Office.”
The settlement resolves allegations originally brought in a lawsuit filed by a whistleblower under the qui tam provisions of the False Claims Act, which allow private parties to bring suit on behalf of the government and to share in any recovery. The whistleblower, a former 21st Century Oncology LLC medical assistant, will receive $3.2 million as her share of the recovery in this case.
The investigation was handled by the Civil Division’s Commercial Litigation Branch and the Fort Myers Division of the U.S. Attorney’s Office of the Middle District of Florida with assistance from HHS-OIG, DCIS and the FBI.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $26.7 billion through False Claims Act cases, with more than $16.8 billion of that amount recovered in cases involving fraud against federal health care programs.
The lawsuit is captioned United States, State of Florida, ex rel. Mariela Barnes v. Dr. David Spellberg, 21st Century Oncology and Naples Urology Associates, Civil Action No. 2:13-cv-228-FtM-38DNF (M.D. Fla.). The claims resolved by the settlement are allegations only, and there has been no determination of liability.
21st Century Oncology to Pay $19.75 Million to Settle Alleged False Claims for Unnecessary Laboratory TestsRead the Press Release
Fort Myers, FL – 21st Century Oncology LLC, has agreed to pay $19.75 million to the government to resolve allegations that it violated the False Claims Act by billing federal health care programs for laboratory tests that were not medically necessary, the Justice Department announced today. 21st Century is a nationwide provider of integrated cancer care services that is headquartered in Fort Myers, Florida.
“Today’s settlement demonstrates our unwavering commitment to protect the Medicare trust fund against unscrupulous providers,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “Providers who waste taxpayer dollars by billing for unnecessary services will face serious consequences.”
The settlement announced today resolves allegations that 21st Century submitted claims to Medicare and Tricare for fluorescence in situ hybridization, or “FISH,” tests that were not medically necessary. FISH tests are laboratory tests performed on urine that can detect genetic abnormalities associated with bladder cancer. The government alleged that 21st Century submitted claims for unnecessary FISH tests that were ordered by four of its urologists, Dr. Meir Daller, Dr. Steven Paletsky, Dr. David Spellberg and Dr. Robert Scappa, all of whom practiced in the Fort Myers area. The government also alleged that 21st Century encouraged these physicians to order unnecessary FISH tests by offering bonuses that were based in part on the number of tests referred to 21st Century’s laboratory. Today’s settlement resolves the civil liability of 21st Century only.
“Charging the government for clearly unnecessary medical services squanders taxpayer dollars,” said U.S. Attorney A. Lee Bentley, III of the Middle District of Florida. “Our office will continue to pursue health care providers who defraud the United States, thereby threatening the viability of government health care programs, such as Medicare.”
“These tests were ordered to increase profits, not improve the healthcare of patients,” said Special Agent in Charge Shimon Richmond of the Department of Health and Human Services Office of Inspector General (HHS-OIG). “This kind of unvarnished fraud is an attack on Medicare by unscrupulous providers and the OIG and its federal partners will take whatever steps are necessary to stop them.”
“This settlement demonstrates the commitment of the Defense Criminal Investigative Service (DCIS) and its law enforcement partners to protect the integrity of the U.S. military health care program (TRICARE) against fraudulent claims for medical services, said Special Agent in Charge John F. Khin of DCIS’s Southeast Field Office.”
The settlement resolves allegations originally brought in a lawsuit filed by a whistleblower under the qui tam provisions of the False Claims Act, which allow private parties to bring suit on behalf of the government and to share in any recovery. The whistleblower, a former 21st Century Oncology LLC medical assistant, will receive $3.2 million as her share of the recovery in this case.
The investigation was handled by Trial Attorney Arthur Di Dio from the Civil Division’s Commercial Litigation Branch and Assistant U.S. Attorney Kyle S. Cohen from the Fort Myers Division of the U.S. Attorney’s Office for the Middle District of Florida with assistance from HHS-OIG, DCIS and the FBI.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $26.7 billion through False Claims Act cases, with more than $16.8 billion of that amount recovered in cases involving fraud against federal health care programs.
The lawsuit is captioned United States, State of Florida, ex rel. Mariela Barnes v. Dr. David Spellberg, 21st Century Oncology and Naples Urology Associates, Civil Action No. 2:13-cv-228-FtM-38DNF (M.D. Fla.). The claims resolved by the settlement are allegations only, and there has been no determination of liability.
Thursday 17 December 2015
York County Man Charged with Using Skimming Device to Commit Bank Fraud and Identity TheftRead the Press Release
HARRISBURG – The United States Attorney’s Office for the Middle District of Pennsylvania announced that yesterday a federal Grand Jury in Harrisburg charged Jeshua Paonessa-Velez, age 24, a York City resident with bank fraud and identity theft. Paonessa-Velez is not in custody.
According to U.S. Attorney Peter Smith, the indictment charges that between November 1 and November 7, 2014, Paonessa-Velez devised a scheme to obtain money from Adams County National Bank by placing a “skimming” device on one of the bank’s ATMs, capturing identification information of bank customers using that ATM, loading that information onto access devices, and making purchases with those access devices.
The indictment also charges Paonessa-Velez with 12 counts of aggravated identity theft for stealing the means of identification of 12 of the bank’s customers.
This matter was investigated by the Harrisburg Resident Office of the United States Secret Service and the Southwestern Regional (York County) Police Department. Prosecution has been assigned to Assistant U.S. Attorney James T. Clancy.
The Adams County National Bank and the retail establishments where Paonessa-Velez allegedly made the purchases using the stolen identities cooperated in the investigation. The bank reimbursed all of the affected customers for the losses to their accounts.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law for the bank fraud offense is 30 years of imprisonment, a term of supervised release following imprisonment, and a fine. The penalty for aggravated identity theft is 2 years of imprisonment consecutive to any sentence imposed for the underlying bank fraud offense. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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