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3 February 2016
Two Women Plead Guilty to Defrauding USDA’s Summer Food Service ProgramRead the Press Release
NORFOLK, Va. – Cindy Hall, 41, of Monroe, North Carolina, pleaded guilty today to charges of mail fraud and unlawful monetary transactions. Hall’s mother, Stephanie Almond, 61, of Franklin, pleaded guilty on Jan. 27, 2016, to charges of mail fraud.
According to statements of facts filed with the plea agreements, Cindy Hall ran a non-profit organization known as Send Thee Community Outreach, allegedly to administer the Summer Food Service Program (SFSP), which is a USDA federally-funded program to feed children during the summer when free-lunch programs end at the conclusion of the school year. The Virginia Department of Health (VDH) administers the SFSP in Virginia. In 2012 and 2013, Hall submitted fraudulent claims to VDH for reimbursement, resulting in at least $150,000 in overpayment to Hall. Almond previously ran her own non-profit organization, Neighborhood Pride, which was a SFSP sponsor approximately 2008 to 2011, when she was disqualified by VDH. Almond continued to be involved with the program with Hall, until Hall was told she was disqualified by VDH from receiving funds in 2014.
Hall and Almond were indicted by a federal grand jury on Oct. 8, 2015. Hall and Almond face a maximum penalty of 20 years in prison when sentenced on May 4, 2016. 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; Colonel W. Steven Flaherty, Superintendent of Virginia State Police; June W. Jennings, Inspector General of Virginia; and Phyllis K. Fong, Inspector General for U.S. Department of Agriculture, made the announcement after the plea was accepted by U.S. Magistrate Judge Robert Krask. Assistant U.S. Attorney Elizabeth M. Yusi is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:15cr132.
Two Northeast Pennsylvania Check Cashers Charged in Separate Stolen Identity Refund Fraud SchemesRead the Press Release
SCRANTON – The United States Attorney’s Office for the Middle District of Pennsylvania announced that two northeast Pennsylvania check cashers have been charged as a result of their participation in separate stolen identity refund fraud schemes.
Jose Cabreja, age 30, of Scranton, and Franklyn Nunez, age 40, of Hazleton, were charged in one-count criminal informations filed today in federal court in Scranton with conspiracy to make false claims against the government.
According to United States Attorney Peter Smith, the Cabreja Information charges that Cabreja operated Frank Check Casher, Inc. in Olyphant, and that his co-conspirators used the identities of unknowing third parties to prepare and file fraudulent federal income tax returns. The Information alleges that Cabreja deposited and cashed fraudulently obtained tax refund checks totaling $876,731 between June and August 2013.
The Nunez Information charges that he operated The Closet Multi-Service, LLC in Hazleton, and alleges that co-conspirators of Nunez used the identities of unknowing third parties to prepare and file fraudulent federal income tax returns. The Information also alleges that Nunez deposited and cashed fraudulently obtained tax refund checks totaling $358,525 between June and September 2011.
The government also filed a plea agreement in each case which is subject to approval by the court.
According to United States Attorney Smith, the prosecution of fraudulent tax refund schemes that rob tax payers as well as the government is a high priority in this district.
The Department of Justice views the prosecution of Stolen Identity Refund Fraud, or “SIRF,” as vital. These schemes disrupt the orderly administration of the income tax system for hundreds of thousands of law abiding taxpayers nationwide and have cost the United States Treasury billions of dollars. SIRF crimes are often perpetrated by criminal enterprises with key individuals at all stages of the scheme: those who steal Social Security Numbers and other personal identifying information, those who file false returns with the Internal Revenue Service, those, including check cashers, who facilitate obtaining the refunds, and those who promote the schemes. These criminal enterprises exploit the highly automated systems for storing personal information, preparing and filing tax returns electronically, and generating income tax refunds quickly—often in the form of electronic payments. Everyone with a Social Security Number is potentially vulnerable to having his or her identity stolen. The IRS estimates that during the 2013 filing season alone, over 5 million tax returns were filed using stolen identities, claiming approximately $30 billion in refunds.
The charges in the present cases are the result of ongoing investigations by the Scranton Office of the Internal Revenue Service, Criminal Investigation, with assistance from the Pennsylvania State Police, the Hazelton, Taylor, Dickson City, Dunmore and Olyphant Police Departments, and the Lackawanna and Luzerne County District Attorneys’ Offices. The cases are assigned to Assistant United States Attorney William Houser for prosecution.
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 is 10 years of imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Two Men Sentenced to a Total of 119 Months Imprisonment for Bank Robbery in Hot SpringsRead the Press Release
Acting United States Attorney Kenneth Elser
Western District of Arkansas
_______________________________________________________FOR IMMEDIATE RELEASE CONTACT: Joyce Snow
February 3, 2016 PHONE: (479) 494-4066TWITTER: @WDARnews
TWO MEN SENTENCED TO A TOTAL OF 119 MONTHS IMPRISONMENT FOR BANK ROBBERY IN HOT SPRINGS
Hot Springs, Arkansas - Kenneth Elser, Acting United States Attorney for the Western District of Arkansas, announced that two men were sentenced on one count each of Bank Robbery, Aiding, and Abetting in connection with a 2014 bank robbery in Hot Springs. Nicholas Tolerson, age 36 of Little Rock, was sentenced yesterday to 77 months in prison and three years supervised release. James Pritchett, age 30 of Maumelle, was sentenced on January 27, 2016 to 42 months imprisonment and three years supervised release. The Honorable Susan O. Hickey presided over the sentencing hearings in the United States District Court in Hot Springs.
According to court records, on April 4, 2014, officers with the Hot Springs Police Department responded to a bank robbery at Bancorp South. Upon their arrival, officers spoke with witnesses who observed a man running out of the bank carrying a red bag and getting into a silver Cadillac. Witnesses were also able to relay the tag number of the vehicle to officers. Later that day, officers located the suspect’s vehicle in front of the Oaklawn Race Track and a pursuit ensued. The vehicle crashed, and after a foot pursuit, both suspects were taken into custody. The driver was identified as James Pritchett, and the passenger was identified as Nicholas Tolerson. Officers were also able to locate the red bag that Tolerson used during the robbery and had thrown out of the vehicle during the pursuit. A Federal Grand Jury issued an indictment for Tolerson and Pritchett on May 7, 2014. Tolerson pleaded guilty on March 18, 2015. Prichett pleaded guilty on May 21, 2015.
This case was investigated by the Hot Springs Police Department and the FBI. Assistant U.S. Attorney David Harris prosecuted the case for the United States.
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Related court documents may be found on the Public Access to Electronic Records website @ www.pacer.gov
Two Georgia Real Estate Investors Indicted for Bid Rigging and Bank Fraud at Public Home Foreclosure AuctionsRead the Press Release
A federal grand jury in Atlanta charged in separate indictments two real estate investors with bid rigging and bank fraud related to public real estate foreclosure auctions in Georgia, the Justice Department announced today.
Real estate investor Douglas L. Purdy has been charged with one count of bid rigging and five counts of bank fraud for participating in the alleged conspiracy and scheme at Forsyth County, Georgia, foreclosure auctions from 2008 to 2012. Clifford Wayne Hill was charged with one count of bid rigging and seven counts of bank fraud related to public foreclosure auctions in Gwinnett County, Georgia, from 2007 to 2012. The defendants and their co-conspirators allegedly rigged bids at public foreclosure auctions and defrauded banks that owned the mortgage notes. Among other methods, the conspirators allegedly held secret “second auctions” of properties they had obtained through rigged bids, dividing the auction proceeds that should have gone to pay off debts against the properties and, in some cases, to homeowners who had defaulted.
“These defendants corrupted public foreclosure auctions in Georgia to keep for themselves money that rightfully belonged to banks and homeowners,” said Assistant Attorney General Bill Baer of the Justice Department’s Antitrust Division. “Those who illegally enrich themselves at the expense of financially distressed homeowners and their lenders should be held accountable for their crimes.”
“The FBI continues its work with the U.S. Department of Justice’s Antitrust Division in ridding corrupt activities within the public real estate foreclosure auction process in Georgia,” said Special Agent in Charge J. Britt Johnson of the FBI’s Atlanta Field Office. “The additional federal indictments of these two real estate investors illustrate not only the scope of the problem but also the federal efforts to address it. Anyone with information regarding such criminal activity as alleged here should contact their nearest FBI field office.”
An indictment is not evidence of guilt. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Including the indictments filed today in the Northern District of Georgia, 14 defendants have been charged in connection with the department’s ongoing investigation into bid rigging and fraudulent schemes involving real estate foreclosure auctions in the Atlanta area; 12 have pleaded guilty.
These charges have been filed as a result of the ongoing investigation being conducted by the Antitrust Division’s Washington Criminal II Section, the FBI’s Atlanta Division and the U.S. Attorney’s Office of the Northern District of Georgia, in connection with the president’s Financial Fraud Enforcement Task Force. The president established the task force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ Offices and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information about the task force, please visit www.StopFraud.gov. Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions should contact the Washington Criminal II Section of the Antitrust Division at 202-598-4000, call the Antitrust Division’s Citizen Complaint Center at 888-647-3258, or visit http://www.justice.gov/atr/report-violations.
Purdy Indictment (211.42 KB)
Hill Indictment (274.93 KB)
Troy Man Pleads Guilty to Health Care FraudRead the Press Release
ALBANY, NEW YORK – John VonFricken, age 50, of Troy, New York, pled guilty today to obtaining false receipts for orthodontic services and submitting them to his union’s health care plan, announced United States Attorney Richard S. Hartunian.
VonFricken was charged with health care fraud for obtaining $54,600 in cash reimbursements from the Health and Welfare Plan of the Plumbers and Steamfitters, Local Union Number 7. Between July 2008 and February 2015, VonFricken submitted 18 fake receipts for orthodontic work he did not receive.
VonFricken’s sentencing is scheduled for June 3, 2016 before United States District Court Judge Mae A. D’Agostino. The charges carry a maximum sentence of 10 years in prison, a fine of up to $250,000, and a term of supervised release of up to 3 years. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines and other factors.
This case was investigated by the United States Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, and the Federal Bureau of Investigation, and is being prosecuted by Assistant U.S. Attorney Solomon B. Shinerock.
Three Texas Tax Return Preparers Convicted of Filing False Tax Returns for ClientsRead the Press Release
Three El Paso, Texas, tax return preparers were convicted by a jury yesterday in the U.S. District Court for the Western District of Texas (El Paso Division) of conspiracy to defraud the United States for their involvement in a fraudulent tax return preparation scheme and numerous counts of aiding and assisting in the preparation and filing of materially false federal income tax returns, Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U. S. Attorney Richard L. Durbin Jr. for the Western District of Texas announced.
According to evidence and witness testimony introduced at the trial, Belia Mendoza, 60, was the owner of Mendez Tax Services (MTS), a tax preparation business she operated out of her home in El Paso. Margarita Hernandez, 36, and Denise Duchene, 46, relatives of Mendoza’s, were employees of MTS hired and trained by Mendoza to prepare tax returns for clients for tax years 2008, 2009 and 2010. From February 2009 until June 2011, Mendoza, Hernandez and Duchene conspired to prepare and submit to the Internal Revenue Service (IRS) numerous false Forms 1040 (U.S. Individual Income Tax Returns).
To maximize their clients’ income tax refunds, Mendoza, Hernandez and Duchene placed materially false items on the clients’ tax returns, at times without the knowledge or consent of the clients, including false or inflated figures for unreimbursed employee business expenses, child and dependent care expenses and education credits. Income tax returns prepared by the defendants also included false filing statuses and improperly claimed Earned Income Tax Credits.
“These verdicts represent our continued commitment to identifying and prosecuting those individuals who willfully prepare and file false and fraudulent tax returns,” said Acting Assistant Attorney General Ciraolo. “The millions of U.S. taxpayers who will file returns during the 2016 filing season are entitled to the assistance of honest and competent professionals, and the Tax Division will hold those preparers who in engage in criminal conduct accountable.”
“It’s tax season and the guilty verdicts for Belia Mendoza and her relatives, Margarita Hernandez and Denise Duchene, are proof that taxpayers are fed up with tax fraud and abuse,” said Special Agent in Charge William Cotter of IRS-Criminal Investigation, San Antonio. “Dishonest return preparers use a variety of methods to cheat the government. Remember, it is your responsibility to know what is on your income tax return. You are ultimately responsible for what gets filed with the IRS. Taxpayers are encouraged to visit the IRS.gov website for tips on looking for a reputable return preparer.”
Mendoza, Hernandez and Duchene each face up to five years in federal prison on the conspiracy charge and up to three years in federal prison for each false tax return preparation charge.
Acting Assistant Attorney General Ciraolo and U.S. Attorney Durbin commended special agents of IRS-Criminal Investigation, who investigated the case and Trial Attorney Joseph M. Giannullo of the Tax Division and Assistant U.S. Attorneys Adrian Gallegos and Rifian Newaz, who prosecuted the case.
Texas Woman Sentenced to Prison in Prescription Drug Smuggling RingRead the Press Release
The Department of Justice announced today that an Athens, Texas, woman has been sentenced to more than one year in prison for her role in the smuggling of imitation, unapproved and misbranded prescription drugs from China.
Catherine Nix, 42, pleaded guilty in April 2015 to one count of conspiracy to smuggle the drugs into the United States. Nix was sentenced to 15 months in prison, followed by two years of supervised release. Two co-defendants, Tom Giddens, 59, and Wanda Hollis, 64, also of Athens, were each sentenced to 15 months in prison in October 2015.
“Consumers of prescription drugs need to know that what they are buying is legitimate, safe, and approved,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “This illegal operation introduced more than 100,000 bogus pills into the stream of commerce, potentially posing a huge public health and safety risk. Consumers should know that the drugs they are buying are exactly what they appear to be, and not false versions of name-brand products that could ultimately do them more harm than good.”
In 2009, the defendants smuggled at least 43 known shipments, totaling approximately 106,000 pills, from China to Texas. The shipments contained unapproved, bogus versions of several FDA-approved drugs that, because of the health and safety risks associated with their use, require valid prescriptions to dispense. The prescription drugs seized included: Xanax®; Valium®; sibutramine; Cialis®; Viagra® and Stilnox®, marketed in the United States as Ambien®. None of the pills that were seized and tested were legitimate. Some were sub-potent, but most contained entirely different active ingredients from their legitimate, approved versions. The defendants attempted to hide their smuggling by using shipping labels that concealed the contents of their shipments and customs declarations falsely describing the contents as “gifts” or “toys.” They used multiple addresses in an effort to reduce the likelihood of seizures by U.S. Customs and Border Protection authorities.
“This office remains committed to stemming the increasing flood of illegitimate prescription drugs that come into East Texas,” said U.S. Attorney John M. Bales for the Eastern District of Texas. “This case puts the very real, inherent dangers of counterfeit prescription drugs on full display. These pills looked almost exactly like their legitimate counterparts, but lacked any of the safety or efficacy of the legitimate versions.”
“FDA’s laws are in place to ensure that consumers have access to safe and effective prescription drugs,” said Director George M. Karavetsos of the FDA’s Office of Criminal Investigations. “Those who evade those laws risk harming the public’s health. We will continue to work with our law enforcement partners to keep the U.S. marketplace free of illegitimate medical products.”
This case was investigated by the FDA’s Office of Criminal Investigations and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. The case was prosecuted by Assistant U.S. Attorney Allen Hurst for the U.S. Attorney’s Office for the Eastern District of Texas and by Trial Attorney John W.M. Claud of the Civil Division’s Consumer Protection Branch.
Tennessee Man Pleads Guilty for Role in New Orleans-Based Sex Trafficking SchemeRead the Press Release
WASHINGTON – The Justice Department announced today that Granville Robinson, 27, of Memphis, Tennessee, pleaded guilty to one count of conspiring to commit sex trafficking and one count of sex trafficking for his role in scheme operated out of the Riviera Motel in New Orleans. Six defendants have previously pleaded guilty in connection with the scheme, which used force and threats to compel multiple women to engage in prostitution for the defendants’ profit in New Orleans and elsewhere.
“Human traffickers facilitate a form of modern-day slavery that threatens the dignity of vulnerable individuals and violates the most basic standards of human decency,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division. “We will continue to vigorously pursue justice by prosecuting traffickers and protecting victims from this heinous crime that has no place in our society.”
“This defendant recruited vulnerable victims from the New Orleans community and brought other victims to New Orleans to engage in commercial sex trafficking,” said U.S. Attorney Kenneth A. Polite of the Eastern District of Louisiana. “These crimes often pass without detection because victims live in fear from physical abuse, threats and other forms of coercion. My office is committed to prosecuting individuals who manipulate victims into committing commercial sex acts and profit from this illegal conduct.”
“Granville Robinson is not only the ringleader of this gang, but also the most violent of the group,” said Special Agent in Charge Jeffrey S. Sallet of the FBI’s New Orleans Division. “In December 2015, the FBI New Orleans Division established the ‘Violent Crime Against Children and Human Trafficking Task Force,’ a stand-alone squad formed to specifically address the Human Trafficking threat in Louisiana. We will continue to aggressively work with our federal, state, and local law enforcement partners to investigate these matters and bring people to justice.”
“Sex traffickers have complete disregard for humanity. They treat people as commodities solely for financial gain,” said Special Agent in Charge Raymond R. Parmer Jr. of Homeland Security Investigations (HSI) New Orleans. “With this guilty plea, we have made our nation safer, ensuring this trafficker can't harm future victims.”
On Oct. 3 2014, Robinson and co-defendants Duane Phillips, Christopher Williams, Anthony Ellis and Laquentin Brown were charged in a second superseding indictment with sex trafficking conspiracy and varying counts of sex trafficking and transportation for prostitution. An additional defendant, Kanubhai Patel, who owned the Riviera Motel where the sex trafficking scheme was based, was charged in the same indictment with benefitting financially from sex trafficking. A seventh defendant, Zacchaeus Taylor, was charged separately on March 28, 2014.
According to Robinson’s admissions during his plea hearing and other court documents, he enforced strict rules on the women he trafficked as part of his conspiracy. These rules included requiring the women to earn a minimum amount each day, to provide him with all of their earnings and to seek his permission to stop prostituting for the night. Robinson confiscated some women’s identification to make it harder for them to leave, and forced some to get tattoos signifying that they belonged to him. When the women broke the rules or did not earn enough money, Robinson physically assaulted them.
Robinson acknowledged compelling and coercing more than 10 different women to engage in prostitution for his profit from 2012 through January 2014 in connection with the charged conspiracy. Robinson admitting using force to punish and control the women, including one instance of punching and kicking a woman in the abdomen, knowing she was pregnant, to punish her for texting without his permission, and another instance of shoving a woman into a toilet tank hard enough to break it, then striking her repeatedly with a wooden board, to punish her for reportedly planning to escape.
Robinson and his co-defendants aided each other by posting bond for each other following arrests, monitoring the women and reporting to each other any violations of the rules the defendants imposed on the women and transporting women together from New Orleans to Texas, Tennessee, Maryland and Washington, D.C., for prostitution. When two women tried to escape on one such trip, Robinson and a co-defendant found them, forced them into a car, and brought them back to New Orleans to continue prostituting.
Robinson and his co-defendants operated out of certain motels, including the Riviera, which generally did not report their activities to the police. The defendants rented multiple rooms at the Riviera where women would meet prostitution clients, and paid the Riviera above-market rates to reflect the high traffic through the rooms.
Robinson is the seventh defendant to plead guilty in connection with this case. On July 1, 2015, Patel pleaded guilty to benefitting financially from human trafficking. In March and April 2015, Phillips, Williams, Ellis and Brown pleaded guilty to conspiracy to engage in sex trafficking by force, fraud and coercion. Ellis and Brown also pleaded guilty to interstate transportation for prostitution. On June 25, 2014, Taylor pleaded guilty to sex trafficking conspiracy and interstate transportation for prostitution.
At sentencing, currently scheduled for May 4, 2016, Robinson faces a minimum sentence of 15 years in prison and a maximum sentence of life in prison. The plea agreement provides for a recommended sentence of 24 and a half years in prison.
This case was investigated jointly by the FBI’s New Orleans Division and HIS’s New Orleans Field Office, with assistance from the FBI’s Memphis Division. This case is being prosecuted by Trial Attorney Christine M. Siscaretti and Special Litigation Counsel John Cotton Richmond of the Civil Right Division’s Human Trafficking Prosecution Unit, and Assistant U.S. Attorney Julia K. Evans of the Eastern District of Louisiana.
Tennessee Man Pleads Guilty for Role in New Orleans-Based Sex Trafficking SchemeRead the Press Release
Seventh Defendant to Plead Guilty in Sex Trafficking Case
The Justice Department announced today that Granville Robinson, 27, of Memphis, Tennessee, pleaded guilty to one count of conspiring to commit sex trafficking and one count of sex trafficking for his role in scheme operated out of the Riviera Motel in New Orleans. Six defendants have previously pleaded guilty in connection with the scheme, which used force and threats to compel multiple women to engage in prostitution for the defendants’ profit in New Orleans and elsewhere.
“Human traffickers facilitate a form of modern-day slavery that threatens the dignity of vulnerable individuals and violates the most basic standards of human decency,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division. “We will continue to vigorously pursue justice by prosecuting traffickers and protecting victims from this heinous crime that has no place in our society.”
“This defendant recruited vulnerable victims from the New Orleans community and brought other victims to New Orleans to engage in commercial sex trafficking,” said U.S. Attorney Kenneth A. Polite of the Eastern District of Louisiana. “These crimes often pass without detection because victims live in fear from physical abuse, threats and other forms of coercion. My office is committed to prosecuting individuals who manipulate victims into committing commercial sex acts and profit from this illegal conduct.”
“Granville Robinson is not only the ringleader of this gang, but also the most violent of the group,” said Special Agent in Charge Jeffrey S. Sallet of the FBI’s New Orleans Division. “In December 2015, the FBI New Orleans Division established the ‘Violent Crime Against Children and Human Trafficking Task Force,’ a stand-alone squad formed to specifically address the Human Trafficking threat in Louisiana. We will continue to aggressively work with our federal, state, and local law enforcement partners to investigate these matters and bring people to justice.”
“Sex traffickers have complete disregard for humanity. They treat people as commodities solely for financial gain,” said Special Agent in Charge Raymond R. Parmer Jr. of Homeland Security Investigations (HSI) New Orleans. “With this guilty plea, we have made our nation safer, ensuring this trafficker can't harm future victims.”
On Oct. 3 2014, Robinson and co-defendants Duane Phillips, Christopher Williams, Anthony Ellis and Laquentin Brown were charged in a second superseding indictment with sex trafficking conspiracy and varying counts of sex trafficking and transportation for prostitution. An additional defendant, Kanubhai Patel, who owned the Riviera Motel where the sex trafficking scheme was based, was charged in the same indictment with benefitting financially from sex trafficking. A seventh defendant, Zacchaeus Taylor, was charged separately on March 28, 2014.
According to Robinson’s admissions during his plea hearing and other court documents, he enforced strict rules on the women he trafficked as part of his conspiracy. These rules included requiring the women to earn a minimum amount each day, to provide him with all of their earnings and to seek his permission to stop prostituting for the night. Robinson confiscated some women’s identification to make it harder for them to leave, and forced some to get tattoos signifying that they belonged to him. When the women broke the rules or did not earn enough money, Robinson physically assaulted them.
Robinson acknowledged compelling and coercing more than 10 different women to engage in prostitution for his profit from 2012 through January 2014 in connection with the charged conspiracy. Robinson admitted to using force to punish and control the women, including one instance of punching and kicking a woman in the abdomen, knowing she was pregnant, to punish her for texting without his permission, and another instance of shoving a woman into a toilet tank hard enough to break it, then striking her repeatedly with a wooden board, to punish her for reportedly planning to escape.
Robinson and his co-defendants aided each other by posting bond for each other following arrests, monitoring the women and reporting to each other any violations of the rules the defendants imposed on the women and transporting women together from New Orleans to Texas, Tennessee, Maryland and Washington, D.C., for prostitution. When two women tried to escape on one such trip, Robinson and a co-defendant found them, forced them into a car, and brought them back to New Orleans to continue prostituting.
Robinson and his co-defendants operated out of certain motels, including the Riviera, which generally did not report their activities to the police. The defendants rented multiple rooms at the Riviera where women would meet prostitution clients, and paid the Riviera above-market rates to reflect the high traffic through the rooms.
Robinson is the seventh defendant to plead guilty in connection with this case. On July 1, 2015, Patel pleaded guilty to benefitting financially from human trafficking. In March and April 2015, Phillips, Williams, Ellis and Brown pleaded guilty to conspiracy to engage in sex trafficking by force, fraud and coercion. Ellis and Brown also pleaded guilty to interstate transportation for prostitution. On June 25, 2014, Taylor pleaded guilty to sex trafficking conspiracy and interstate transportation for prostitution.
At sentencing, currently scheduled for May 4, 2016, Robinson faces a minimum sentence of 15 years in prison and a maximum sentence of life in prison. The plea agreement provides for a recommended sentence of 24 and a half years in prison.
This case was investigated jointly by the FBI’s New Orleans Division and HIS’s New Orleans Field Office, with assistance from the FBI’s Memphis Division. This case is being prosecuted by Trial Attorney Christine M. Siscaretti and Special Litigation Counsel John Cotton Richmond of the Civil Right Division’s Human Trafficking Prosecution Unit, and Assistant U.S. Attorney Julia K. Evans of the Eastern District of Louisiana.
Robinson Plea Agreement
Sumter County Convicted Felon Pleads Guilty to Federal Drug and Firearms OffensesRead the Press Release
Ocala, Florida – United States Attorney A. Lee Bentley, III, announces that Thomas Franklin Dinkins, Jr. (25, Lake Panasoffkee) has pleaded guilty to possessing with the intent to distribute methamphetamine and possessing a firearm in furtherance of a drug trafficking crime. He faces a maximum penalty of 20 years in federal prison for the drug offense and a consecutive sentence of at least 5 years, up to life, for the firearms offense. A sentencing date has not yet been set.
According to the plea agreement, on December 16, 2014, deputies from the Sumter County Sheriff’s Office (SCSO) stopped Dinkins for an expired tag. After a narcotics canine subsequently alerted on the car, deputies performed a search and found a locked, portable safe in the trunk. The key to the safe was in Dinkins’s jacket. Inside the safe, deputies found methamphetamine, two digital scales, plastic baggies, and a loaded .22 caliber handgun with an obliterated serial number. Deputies also located a backpack containing additional plastic bags and ammunition. A check of Dinkins’s criminal history revealed he was a multi-convicted felon who is prohibited from possessing firearms and ammunition under federal law. Dinkins later admitted that the firearm was “probably stolen” and that he had it to protect himself while distributing drugs.
On March 21, 2015, a discarded cellphone was discovered by a citizen and turned over to SCSO. After reviewing some of its contents, deputies determined that it had belonged to Dinkins. Multiple pictures and text messages found on the phone linked the recovered handgun, another shotgun, and numerous drug sales to Dinkins.
This case was investigated by the Sumter County Sheriff’s Office and the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorney Robert E. Bodnar, Jr.
St. Francis Man Sentenced for Assault with a Dangerous WeaponRead the Press Release
United States Attorney Randolph J. Seiler announced that a St. Francis, South Dakota, man convicted of Assault with a Dangerous Weapon was sentenced on January 25, 2016, by U.S. District Judge Roberto Lange.
Allan Left Hand Bull, age 23, was sentenced to 42 months in custody, followed by 2 years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Left Hand Bull was indicted for Assault with a Dangerous Weapon by a federal grand jury on October 14, 2015. He pled guilty on December 8, 2015.
On August 10, 2015, Left Hand Bull and his girlfriend, the victim, were drinking alcoholic beverages in St. Francis. Left Hand Bull was intoxicated and became upset with the victim. Left Hand Bull left the area where they were drinking, but soon thereafter saw the victim walking down a street in St. Francis and ran toward her with a knife. Left Hand Bull put his arm around the victim and choked her.
This case was investigated by the Rosebud Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Carrie G. Sanderson prosecuted the case.
Left Hand Bull was immediately turned over to the custody of the U.S. Marshals Service.
Shreveport man sentenced to 27 months in prison for evasion of tax paymentsRead the Press Release
SHREVEPORT, La. – United States Attorney Stephanie A. Finley announced that a Shreveport man was sentenced Tuesday to 27 months in prison for evading the payment of more than $250,000 in taxes for 10 years.
Joseph Lanza, 72, of Shreveport, was sentenced by U.S. District Judge Elizabeth E. Foote on one count of attempting to evade and defeat payment of tax. He was also sentenced to three years of supervised release. Lanza attempted to evade payment of income taxes in 1996 through 1999, 2001, 2002 and 2004 through 2007 by concealing his income from the IRS.
The IRS conducted the investigation. Assistant U.S. Attorney William J. Flanagan prosecuted the case.
Schenectady Man Indicted for Firearm OffensesRead the Press Release
ALBANY, NEW YORK – A federal grand jury today returned a two-count superseding indictment charging John Coffin, age 46, of Schenectady, New York, of being a felon and armed career criminal in possession of a firearm, as well as possessing a firearm in furtherance of a drug trafficking crime.
The announcement was made by United States Attorney Richard S. Hartunian and Andrew W. Vale, Special Agent in Charge of the Albany Division of the Federal Bureau of Investigation.
The superseding indictment alleges that on March 23, 2015, Coffin possessed a Walther P22 semi-automatic pistol and .22 caliber ammunition.
The superseding indictment also alleges that on July 28, 2015, Coffin possessed a Hi-Point 995 9-millimeter rifle and 9-millimeter ammunition, and possessed that rifle and ammunition in connection with a drug trafficking crime.
The charges in the superseding indictment are merely accusations. The defendant is presumed innocent until proven guilty.
Coffin has three prior convictions for violent felonies or drug trafficking crimes, making him an armed career criminal under federal law and subject to a minimum 15-year prison sentence if convicted. Additionally, any person convicted of possessing a firearm in furtherance of a drug trafficking crime is subject to a minimum 5-year prison sentence.
Coffin faces the maximum of life imprisonment and a $250,000 fine if convicted of either count. A defendant’s sentence is imposed by a judge based on a combination of factors including the U.S. Sentencing Guidelines and relevant statutes.
Trial is scheduled to begin on March 21, 2016 before United States District Judge Gary L. Sharpe. Coffin is detained until trial.
This case is being investigated by the Federal Bureau of Investigation and the Schenectady Police Department, and is being prosecuted by Assistant U.S. Attorneys Wayne A. Myers and Kofi Sansculotte.
Schenectady Man Indicted as an Armed Career CriminalRead the Press Release
ALBANY, NEW YORK – An indictment was unsealed this week charging Tameen Johnson, age 38, of Schenectady, New York, of being a felon and armed career criminal in possession of a firearm.
The announcement was made by United States Attorney Richard S. Hartunian and Andrew W. Vale, Special Agent in Charge of the Albany Division of the Federal Bureau of Investigation.
Johnson, who was indicted on December 23, 2015, is alleged to have possessed a Hi-Point .40 caliber pistol and ammunition in April 2015. At the time, Johnson had three prior convictions for violent felonies or drug trafficking crimes, making him an armed career criminal under federal law and subject to a minimum 15-year prison sentence if convicted.
The charges in the indictment are merely accusations. The defendant is presumed innocent until proven guilty.
Johnson faces a maximum of life imprisonment and a $250,000 fine if convicted. A defendant’s sentence is imposed by a judge based on a combination of factors including the U.S. Sentencing Guidelines and relevant statutes.
Trial is scheduled to begin on April 25, 2016 before United States District Judge Gary L. Sharpe. Johnson is detained until trial.
This case is being investigated by the Federal Bureau of Investigation and the Schenectady Police Department, and is being prosecuted by Assistant U.S. Attorney Wayne A. Myers.
Sacramento Man Sentenced to 18 Months in Prison for Tax Refund SchemeRead the Press Release
SACRAMENTO, Calif. — United States District Judge Kimberly J. Mueller sentenced Manuel Ruiz, 47, of Sacramento, to 18 months in prison for making false claims for tax refunds on federal income tax returns, United States Attorney Benjamin B. Wagner announced. Ruiz pleaded guilty on May 26, 2015.
According to court documents, Ruiz engaged in a scheme to fraudulently prepare tax returns for clients of a tax preparation business he operated from his home. As part of the scheme, Ruiz reported false wages and listed false dependents on his clients’ returns to qualify them for the Earned Income Credit (EIC) when they would not otherwise have been eligible, and to maximize the tax benefits of the EIC beyond the legitimate amounts to which his clients were actually qualified.
In total, between tax years 2009 and 2011, Ruiz made false claims on more than 180 returns, including returns that he filed on his own behalf and on behalf of others, which resulted in over $650,000 in fraudulent refunds paid out by the IRS. During that period, Ruiz directed more than $460,000 in tax refunds from the false claims into bank accounts he controlled. After payments to clients, Ruiz retained at least $192,000 from the false claims.
This case was the product of an investigation by the Internal Revenue Service, Criminal Investigation. Assistant United States Attorneys Sherry D. Hartel Haus and André M. Espinosa prosecuted the case.
Rockwall Man Sentenced to 180 Months in Federal Prison on Child Pornography Conviction Involving Images of Prepubescent ChildrenRead the Press Release
DALLAS — Christopher Michael Burgess, 33, of Rockwall, Texas, was sentenced this morning by U.S. District Judge Sam A. Lindsay to 180 months in federal prison, following his guilty plea to an indictment charging one count of possession of prepubescent child pornography, announced U.S. Attorney John Parker of the Northern District of Texas.
According to documents filed in the case, in May 2013, an individual (mother) looked on Burgess’s computer, found child pornography, and immediately took the computer to the Rockwall Police Department. Based on this information, law enforcement obtained a warrant to search the computer’s content.
The North Texas Regional Computer Forensic Lab examined the hard drive and located more than 500 images and 10 videos of child pornography, some videos involving infants. Burgess admits that some of the videos he collected depicted sadistic and/or violent content.
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 FBI and the Rockwall Police Department investigated. Assistant U.S. Attorney Camille Sparks prosecuted.
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Robert Durst Pleads Guilty to Being a Felon in Possession of a FirearmRead the Press Release
U.S. Attorney Kenneth A. Polite announced that ROBERT DURST, age 72, pled guilty today to being a felon in possession of a firearm.
A judge in Los Angeles, California, signed an arrest warrant for DURST on March 11, 2015, for the 2000 murder of Susan Berman. Agents of the Federal Bureau of Investigation (“FBI”), New Orleans Field Office, located DURST in a local hotel on March 14, 2015, where he had checked in under the alias “Everette Ward.” A lawful search of DURST’s hotel room found him to be in possession of a loaded Smith and Wesson .38 caliber revolver, a realistic mask, and over $40,000 in cash.
DURST was indicted in April of this year in the Eastern District of Louisiana. The indictment alleged that DURST possessed the firearm after having previously been convicted in 2004 of federal felony firearms offenses in the Eastern District of Pennsylvania.
DURST faces a maximum of ten years imprisonment, a fine of $250,000, not more than three years of supervised release, and $100 special assessment fee. U.S. District Judge Kurt D. Engelhard set sentencing for April 27, 2016.
U.S. Attorney Polite praised the work of the Orleans Parish District Attorney’s Office, the FBI, the Los Angeles Police Department, and the Los Angeles County District Attorney’s Office in investigating this matter. Assistant United States Attorneys Michael McMahon and Myles Ranier are in charge of the prosecution.
Richmond Man Sentenced to 27 Years in Prison for Armed RobberyRead the Press Release
RICHMOND, Va. – Marcus Deante Bennett, 32, of Richmond, was sentenced today to 324 months in prison for robbery and brandishing a firearm.
Bennett pleaded guilty on Aug. 11, 2014. According to court documents, on Jan. 9, 2015, Bennett and another individual robbed a McDonald’s restaurant in Henrico. Bennett, who entered the restaurant armed with a black revolver and wearing a mask, approached the restaurant manager and brandished the firearm, ordering the manager to hand over the money in the safe. Bennett then went to the drive through window cashier and forced the cashier to hand over an additional sum of money. In addition to this crime, Bennett admitted to committing three additional armed robberies. Bennett was also given additional prison time for having violated the terms of his federal supervised release related to a series of armed robberies he participated in 12 years ago.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Adam S. Lee, Special Agent in Charge of the FBI’s Richmond Field Office, made the announcement after sentencing by Senior U.S. District Judge James R. Spencer. Assistant U.S. Attorney Angela Mastandrea-Miller 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. 3:15cr134.
Pink Hill Men Sentenced for Methamphetamine Possession & Firearm OffenseRead the Press Release
RALEIGH – The United States Attorney’s Office for the Eastern District of North Carolina announced that in federal court yesterday Senior United States District Judge W. Earl Britt, sentenced RALPH EDWARD STROUD, 50, and LORNE HOWARD, 47, both of Pink Hill, North Carolina, to 132 months’ imprisonment followed by 5 years’ supervised release and 70 months’ imprisonment followed by 3 years of supervised release respectively.
June 1, 2015, HOWARD pled guilty to possession with intent to distribute a quantity of a mixture or substance containing a detectable amount of methamphetamine and aiding and abetting. On June 29, 2015, STROUD pled guilty to the same charge and possession of a firearm in furtherance of a drug trafficking offense.
According to the investigation, on August 15, 2013, law enforcement executed a search warrant at STROUD'S home and property. Law enforcement detained STROUD and his girlfriend and discovered an active methamphetamine lab. Within the lab, officers recovered at total 5 grams of pseudoephedrine,
1,017.79 grams of liquid containing methamphetamine, .82 grams of methamphetamine, empty pseudoephedrine blister packs, homemade ammonia condensers, propane tanks, sulfuric acid, lye, pill grinders, tubing, Coleman camp fuel, fertilizer, stripped lithium batteries, and home HcL generators. A search of the residence recovered small amounts of unmeasured methamphetamine, drug paraphernalia, five firearms, and ammunition. Subsequent to his arrest, STROUD provided an unprotected statement acknowledging ownership of the firearms in his residence and the production of methamphetamine on his property.
On August 19, 2013, HOWARD was arrested and provided an unprotected statement acknowledging his use of methamphetamine and that he was present with STROUD on August 15, 2013, while methamphetamine was cooked. HOWARD admitted smoking methamphetamine with STROUD approximately 40 times and purchased it from STROUD approximately 20 to 30 times.
The criminal investigation of this case was conducted by the Lenoir County Sheriff’s Office, Duplin County Sheriff’s Office, the North Carolina State Bureau of Investigation and the Drug Enforcement Administration. Assistant United States Attorney Jennifer Wells handled the prosecution on behalf of the Eastern District of North Carolina.
Owner of Shuttered Louisville Microwave Popcorn Company Ordered to Pay Restitution for Bank FraudRead the Press Release
LOUISVILLE, Ky. – The owner of the shuttered Preston Farms Popcorn, LLC (Preston) was ordered to pay full restitution and serve a three year period of supervised release, by Chief Judge Joseph H. McKinley Jr., in U.S. District Court this week, for diverting buyers’ payments toward the operation of his business rather than towards the payment of his loan, announced U.S. Attorney John E. Kuhn, Jr.
Kermit W. Highfield, 43, of Louisville, pleaded guilty to a single count of bank fraud, stemming from a business loan from UPS Business Capital Credit (UPS) that was insured by the United States Export-Import Bank (Ex-Im Bank). This loan was an advance on payments due from Preston’s international buyers. Preston defaulted on the UPS loan, and the Ex-Im Bank reimbursed UPS, resulting in a loss of $110,678.74 to the Ex-Im Bank. Highfield has repaid $15,000 of the total loss.
According to the plea agreement, between March 18, 2013 and May 30, 2013, Highfield executed a scheme to defraud UPS. Under the terms of the loan, Preston was required to instruct buyers of the product to transmit payments into a specific BB&T Bank account, and those funds were to be used to pay off the UPS loan. However, Highfield admitted to instructing Preston’s buyers to deposit payments into other bank accounts controlled by Highfield and Preston. The funds were diverted from UPS and used by Highfield to pay for Preston operating expenses.
This case was prosecuted by Assistant United States Attorney David Weiser and was investigated by United States Export-Import Bank OIG in Washington, D.C.
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The Ex-Im Bank is the official export credit agency of the United States, and assists in financing the export of U.S. goods and services to international markets. Complaints and reports of waste, fraud, and abuse related to Ex-Im Bank programs and operations can be reported to the OIG hotline at 888-OIG-EXIM (888-644-3946) or via email at [email protected].
Oswego Man Arrested for Distribution, Receipt and Possession of Child PornographyRead the Press Release
SYRACUSE, NEW YORK – James M. Moody, Jr., 41, of Oswego, New York, was arrested yesterday on charges of distribution, receipt and possession of child pornography following a joint investigation by Special Agents of the Department of Homeland Security Investigations ("HSI"), the New York State Police-Computer Crime Unit and the Oswego Police Department, announced United States Attorney Richard S. Hartunian.
The defendant appeared today in federal court in Syracuse, New York, before United States Magistrate Judge David E. Peebles. He is being held in custody pending a detention hearing set for February 8, 2016.
If convicted of distributing, receiving and possessing child pornography, Moody faces a mandatory minimum sentence of five (5) years imprisonment, a maximum term of 20 years imprisonment, a fine of up to $250,000, a term of supervised release of at least 5 years and up to life, and mandatory registration as a sex offender. Sentences are imposed by a judge based on the particular statute the defendant is charged with violating, the United States Sentencing Guidelines and other factors.
The charges in the complaint are merely accusations. The defendant is presumed innocent until proven guilty.
This case is being prosecuted by Assistant U.S. Attorney Geoffrey J. L. Brown.
Norfolk Man Sentenced to 13 Years for 2007 Armed RobberyRead the Press Release
NORFOLK, Va. – Anthony Charles Hunter, 57, of Norfolk, was sentenced today to a total of 156 months in prison for interference with commerce by robbery and brandishing a firearm during and in relation to a crime of violence. Hunter was also ordered to pay $10,396.01 in restitution.
Hunter pleaded guilty on Oct. 28, 2015. According to court documents, Hunter committed approximately 12 commercial armed robberies in Chesapeake, Norfolk, Suffolk and Virginia Beach between Sept. 29, 2007 and Oct. 18, 2007.
On Oct. 15, 2007, Hunter entered the Acredale Center Citgo in Virginia Beach. Hunter paid a clerk employed at the business $3 for gasoline and left the store. Moments later, Hunter re-entered the store and approached the clerk at the front counter. Hunter brandished a firearm at the clerk and ordered her to be quiet. The clerk, who was in the process of counting the store’s proceeds from the previous weekend with the store safe open, activated a silent alarm. Hunter then walked behind the counter. Fearing for her safety, the clerk struck Hunter in the head, whereupon Hunter struck the clerk upon her head with the firearm. Hunter forced the clerk to the floor behind the counter and stood over her. Hunter instructed the clerk to be quiet and struck her again. Hunter collected approximately $8,000 in cash belonging to the business and left the store.
Dana J. Boente, U.S. Attorney for the Eastern District 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 Raymond A. Jackson.
This case was investigated by the FBI’s Norfolk Field Office with the assistance of the Norfolk, Virginia Beach, Suffolk and Chesapeake Police Departments. Assistant U.S. Attorneys Darryl J. Mitchell and Andrew 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. 2:12-cr-124.
Nine Arrested for Conspiracy to Traffic in Contraband CigarettesRead the Press Release
RALEIGH – The United States Attorney’s Office for the Eastern District of North Carolina announces that the following men were indicted for conspiracy to traffic in contraband cigarettes, trafficking in contraband cigarettes, and aiding and abetting, and those indicated below in the Eastern District of North Carolina had their initial appearance in federal court today. The others are scheduled for their initial appearance in federal court in New York later today.
MOKHTAR ABDUL KAREM KHASHAFA, 34, of Durham (EDNC)
YOUSEF ABDULLA MOHAMED KAID, 35, of Durham (EDNC)
IBRAHIM ABDULLA KAIED, 39, of Durham (EDNC)
TAHA AL MONTASER, 31, of Greenville, North Carolina (EDNC)
AHMED AL MONTASER, 30, of Staten Island, New York
MOHAMMED NASSER ALI, a/k/a “Mo”, 50, of Durham (EDNC)
JABBAR MAZAB, a/k/a “Obaydah”, 38, of Brooklyn, New York
BASSAM SAAD, a/k/a “Sam”, 31, of Syracuse, New York
MUHAMMED LABBID AL HADDAWI, 27, of Durham (EDNC)
The Grand Jury indicted the above listed individuals on January 26, 2016.
According to the investigation, the object of the conspiracy was to profit from the illegal sale of large quantities of cigarettes by purchasing them in North Carolina and then selling them in the State of New York and New York City without paying the much higher taxes that apply there. During the relevant time period, the North Carolina state excise tax was $0.45 per pack of 20 cigarettes, or $4.50 per carton of ten packs. The New York State excise tax was $4.35 per pack ($43.50 per carton), and the New York City excise tax was an additional $1.50 per pack ($15.00 per carton). The total combined excise tax for New York State and New York City was $5.85 per pack, or $58.50 per carton. By evading the New York State and New York City excise taxes, Defendants and their co-conspirators were able to sell the contraband cigarettes at a lower cost, and at a higher profit margin, than competing cigarette sellers in New York who complied with federal and state law.
The Indictment alleges that some of the defendants and co-conspirators owned or operated retail stores in North Carolina, which enabled them to make wholesale purchases of large quantities of cigarettes from wholesale dealers, far exceeding the quantities of cigarettes actually being sold at the stores to retail customers in North Carolina. Defendants and co-conspirators in New York would arrange for the purchase of contraband cigarettes from defendants and co-conspirators in North Carolina. The contraband cigarettes would be transported by vehicle from North Carolina to various storage locations in New York. Various defendants and co-conspirators would apply counterfeit tax stamps to the cigarette packaging to create the false appearance that applicable New York State and New York City excise taxes had been paid.
The Indictment alleges that, from on or about June 15, 2015 to on or about January 16, 2016, the defendants and co-conspirators transported and sold approximately 22,205 cartons of contraband cigarettes, resulting in a total tax loss to the State and City of New York of approximately $1,224,947.50.
The charges are punishable by up to 5 years imprisonment, a fine of up to $250,00, and a term of supervised release of up to 3 years.
The charges and allegations contained in the indictment are merely accusations. The defendants are considered innocent unless and until proven guilty in a court of law.
The case is being investigated by FBI Raleigh with assistance from FBI Newburgh NY, FBI New York, FBI Syracuse, North Carolina State Bureau of Investigation, North Carolina Department of Public Safety, Raleigh Police Department, Durham Police Department, Cary Police Department, Greenville Police Department, North Carolina Alcohol Law Enforcement, North Carolina Probation and Parole, North Carolina State Highway Patrol, New York Department of Taxation and Finance, Internal Revenue Service, United States Marshals Service, and the Virginia National Guard Counterdrug Taskforce. Assistant United States Attorney Eric Goulian is representing the government in this case.
Niagara Falls Man Charged with Being A Felon in Possession of A FirearmRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051BUFFALO, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that Josue Ortiz, 34, of Niagara Falls, NY, was arrested and charged by criminal complaint with being a felon in possession of a firearm. The charge carries a maximum penalty of 10 years in prison and a $250,000 fine.
Assistant U.S. Attorney Michael J. Adler, who is handling the case, stated that according to the complaint, on December 23, 2015, the Niagara Falls Police Department was dispatched to a residence on Niagara Avenue. A resident living in the lower apartment told officers that she believed a resident living upstairs had a gun. It was further alleged in court that the defendant threatened to kill a neighbor.
Officers went upstairs and made contact with the defendant through a closed door. According to the complaint, officers asked Ortiz if he had a gun. The officers talked Ortiz into putting down the gun (a 12 gauge shotgun) and putting his hands up. Officers then placed the defendant handcuffs and secured the gun.
The complaint further states that Ortiz purchased the gun on December 22, 106 at a local sporting goods store.
The defendant made an initial appearance this afternoon before U.S. Magistrate Judge Jeremiah J. McCarthy and is being held pending the continuation of a detention hearing on February 5, 2016 at 10:00 a.m.
The indictment is the culmination of an investigation by the Niagara Falls Police Department, under the direction of Chief Bryan DalPorto and the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Delano A. Reid, New York Field Division.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
New York Man Charged with Selling Luxury Counterfeit Goods at the Marshfield FairRead the Press Release
BOSTON – A New York City man was charged today in U.S. District Court in Boston for selling counterfeit goods bearing luxury trademarks at the Marshfield Fair.
Xian Chen Chen, 39, was charged in an Information with introducing imported merchandise by means of false statements and practices. The Information alleges that in summer 2013, Chen Chen sold goods fraudulently bearing the trademarks of Armani, Beats by Dr. Dre, Burberry, Bvlgari, Chanel, Christian Dior, Coach, Dolce Gabbana, Dooney & Bourke, Ed Hardy, Fendi, Gucci, Hello Kitty, Jimmy Choo, Juicy Couture, Louis Vuitton, Marc Jacobs, Michael Kors, Oakley, Prada, Ray Ban, The North Face, Tiffany & Co., Tory Burch, and Versace.
The charge provides for a sentence of no greater than two years in prison, three years of supervised release and a fine of $250,000 or twice the gain or loss, whichever is greater. 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 and Matthew Etre, Special Agent in Charge of Homeland Security Investigations in Boston, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Amy Harman Burkart of Ortiz’s Cybercrime Unit.
The details in the Information are allegations. The defendant is presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
New Orleans Businessman Sentenced on Wire Fraud and Tax ChargesRead the Press Release
U.S. Attorney Kenneth A. Polite announced that JASON C. DOYLE, age 38, of New Orleans, was sentenced today after previously pleading guilty to wire fraud and failing to pay taxes.
U.S. District Judge Sarah S. Vance sentenced DOYLE to 30 months imprisonment, followed by two years of supervised release. As part of the sentence, the Court also ordered DOYLE to pay $993,960.34 in restitution to the victims
According to documents, DOYLE operated, controlled, marketed and sold several restaurant franchises to willing investors. From 2010 through 2014, DOYLE defrauded three investors who paid him monies for a restaurant franchise. DOYLE defrauded the investors of monies totaling in excess of $888,000. These investor monies were paid to DOYLE with the understanding that DOYLE would furnish them with either a restaurant or the equipment and essentials necessary to open a restaurant establishment. Instead of using the investor funds to complete the promised restaurant project, DOYLE fraudulently diverted the monies for his own personal use.
In 2010, DOYLE also deducted federal taxes from his employees’ wages. However, he failed to pay over the collected employee taxes to the Department of Treasury, in violation of federal tax law.
U.S. Attorney Polite praised the work of the Federal Bureau of Investigation and the Internal Revenue Service, Criminal Investigations Division in investigating this matter. Assistant United States Attorneys Richard R. Pickens, II and Andre J. Lagarde were in charge of the prosecution.
New Haven Man Pleads Guilty to Federal Assault in Aid of Racketeering, Crack Distribution OffensesRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that ROBERT HARRIS, also known as “Skully Mack,” 19, of New Haven, pleaded guilty today in Bridgeport federal court to one count of assault in aid of racketeering and one count of possession with the intent to distribute crack cocaine.
On September 30, 2015, a federal grand jury in New Haven returned a 34-count indictment against HARRIS and five co-defendants charging various racketeering, violent crimes in aid of racketeering, firearms, money laundering and narcotics distribution offenses. The indictment described a criminal enterprise known as the Red Side Guerilla Brims (“RSGB”), a sect of the Bloods street gang that operated in New Haven from 2011 through 2015, which was engaged in narcotics trafficking and related acts of violence, including murder, attempted murder, assaults and armed robberies.
In pleading guilty, HARRIS admitted that he was a member of the RSGB in 2014. As part of his gang membership, on December 23, 2014, he and another RSGB member, Christopher Graham, a.k.a. “Ugg,” committed a violent assault of an individual over a .40 caliber pistol that the victim allegedly stole from him. Graham had called HARRIS to the scene after realizing the victim had stolen the gun.
HARRIS further admitted that he distributed approximately 10 grams of crack cocaine in June 2014.
HARRIS has been detained since his arrest on October 1, 2015. He is scheduled to be sentenced by Chief U.S. District Judge Janet C. Hall on April 29, 2016, in New Haven, and faces a maximum penalty of 20 years of imprisonment and a $250,000 fine on the assault count, and 20 years of imprisonment and a $1 million fine on the drug count.
Graham has pleaded guilty to the same charges and awaits sentencing.
This ongoing investigation is being conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the New Haven Police Department, the Connecticut Department of Correction, the Connecticut State Police, the U.S. Drug Enforcement Administration, the Maine Drug Enforcement Agency and the Hamden Police Department. The New Haven State’s Attorney’s Office also provided critical assistance in the investigation.
An instrumental component of the investigation has been the work of the Connecticut State Crime Laboratory in utilizing the National Integrated Ballistic Information Network (NIBIN) to analyze ballistics evidence.
This matter is being prosecuted in the District of Connecticut by Assistant U.S. Attorneys Robert M. Spector and Peter D. Markle. A related case in the District of Maine is being prosecuted by Assistant U.S. Attorney Joel Casey.
Montgomery County Oxycodone Distributor Sentenced to 9 Years in PrisonRead the Press Release
Greenbelt, Maryland – U.S. District Judge Theodore D. Chuang sentenced Richard Michael Mathisen, age 29, of Rockville, Maryland today to nine years in prison followed by three years of supervised release for conspiring to distribute oxycodone and ordered him to pay a $60,000 fine.
The sentence 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; and Chief J. Thomas Manger of the Montgomery County Police Department.
According to court documents and evidence presented at the sentencing hearing, from at least 2013 through at least September 25, 2014, Mathisen arranged for co-conspirators to obtain magnetic resonance imaging scans (MRIs), and take them to another co-conspirator to manipulate the MRIs to make them appear as though the co-conspirators required prescriptions for pain medication. After the co-conspirators used the altered MRIs to obtain prescriptions for oxycodone, they either gave or sold oxycodone to Mathisen who used some of the oxycodone for himself and distributed some of the oxycodone to others.
During the two day sentencing hearing, the court determined that Mathisen was a manager or supervisor of the conspiracy, which included between 60,000 and 105,000 grams of oxycodone. The court also determined that Mathisen had possessed a firearm during drug trafficking.
The government also introduced evidence relating to the death of a young woman on July 12, 2014 at Mathisen’s residence as a result of oxycodone and alcohol intoxication after ingesting oxycodone at Mathisen’s residence. The court found that the woman died as a result of the drug conspiracy.
Philip Rice D’Avanzo, age 29, of Bethesda, Maryland, pleaded guilty to his participation in the drug conspiracy and is scheduled to be sentenced on March 14, 2016 at 2:00 p.m.
United States Attorney Rod J. Rosenstein praised ATF and Montgomery County Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Mara Zusman Greenberg, who prosecuted the case.
Monroe Man Sentenced to 15 Months for Social Security FraudRead the Press Release
Contact: F. Todd Lowell
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Gary D. Hallett, 47, of Monroe, Maine was sentenced today in U.S. District Court by Judge John A. Woodcock, Jr. to 15 months in prison and three years of supervised release for fraudulently obtaining social security disability benefits. Hallett was also ordered to pay $67,753 in restitution. He pleaded guilty to the charge on May 12, 2015.
Court records show that the Social Security Administration (“SSA”) paid disability benefits to Hallett from 2004 until 2014. In 2012, the Bangor Daily News reported that the defendant had been charged with an elver fishing violation. The article indicated that Hallett’s attorney in the state matter had asked the Maine court to delay the trial of the violation because the defendant had the opportunity to make $200,000 in the upcoming elver season. That story led to an investigation by the SSA Office of Inspector General that revealed that Hallett had been working and earning income since 1999 which he had not reported to the SSA as required. As a result, the SSA paid $67,753 in benefits to Hallett to which he was not entitled.
In imposing the sentence, Judge Woodcock said: “I consider your conduct to be deplorable …. The Social Security program is a reflection of the good faith of the American people…. You have been cheating your fellow citizens.”
The investigation was conducted by the SSA Office of Inspector General.
Milwaukee-Area Attorney Sentenced to Four Years in Prison for Defrauding Financial Institutions and Clients, Money Laundering, and Filing a False Tax ReturnRead the Press Release
Gregory J. Haanstad, Acting United States Attorney for the Eastern District of Wisconsin, announced that on February 2, 2016, Sarah E.K. Laux a/k/a “Sarah Kitzke” (age 35) of Mequon, Wisconsin, was sentenced before Judge Charles N. Clevert, Jr. on charges of bank fraud, wire fraud, mail fraud, money laundering, and tax fraud. Laux was sentenced to 48 months in federal prison and was ordered to serve five years on supervised release.
The Court ordered Laux to pay a forfeiture of $2,072,276.48 and forfeited Laux’s interests in other properties, including her interests in her Mequon residence, another parcel of real property in Mequon, a Las Vegas timeshare property, $5,000 in currency, seven jewelry items, and two insurance businesses.
At sentencing, the Court also stated that it will soon enter an order requiring Laux to pay full restitution to the victims of her crimes of conviction, and will order Laux to repay the Internal Revenue Service all back taxes, penalties, and interest arising from her filing of a false 2010 personal income tax return in which she failed to report $200,000 in income.
Sarah E.K. Laux was indicted in December 2014 with defrauding four different clients – an entity and three individuals – to whom Laux had provided trust and estates advice and to whose funds Laux gained access through her solo-practice law firm. Laux defrauded those clients out of more than $2.2 million in funds that Laux then converted to her own use.
As set forth in the indictment, between 2010 and 2012, Laux engaged in a scheme to defraud his client by gaining access to their money and then, through misrepresentations and false pretenses, converting more than $1.6 million of their money to her own use. Laux used that money to buy residential real property and an insurance business and to pay Laux’s personal bills and bills of Laux’s law firm, Laux Law, LLC.
As also set forth in the indictment, Laux also defrauded Associated Bank, N.A., and its subsidiary Associated Trust, N.A., which served as trustee of a trust of which the previously mentioned client was a beneficiary, by falsely representing to those financial institutions that Carleen Guenther needed a distribution from the trust to buy a condominium in a retirement home; causing those financial institutions to distribute the $450,000 for that purpose; and then converting the $450,000 to her own use. Laux then prepared falsified documents and presented those falsified documents, and made false statements, to Associated Trust and Associated Bank to conceal that Laux had fraudulently converted the $450,000 in distributions from the trust to Laux’s own use.
In addition, during 2013, Laux defrauded two other estate-planning clients, a husband and wife, by embezzling approximately $584,000 of their investment monies after having promised to use their money to buy annuities.
According to the indictment, using the proceeds of these various fraud schemes, Laux engaged in money laundering transactions. She also filed a materially false and fraudulent personal income tax return for tax year 2010. Laux falsely stated that her and her husband’s income for 2010 was $104,249, when in fact the amount was in excess of that amount.
On October 6, 2015, Laux pleaded guilty to five counts of the 33-count indictment. Those counts charged her with bank fraud, wire fraud, mail fraud, money laundering, and filing a false tax return.
The case was investigated by Special Agents of the IRS Criminal Investigation and the Federal Bureau of Investigation. Assistant United States Attorney Scott J. Campbell prosecuted the case.
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Michigan Art Dealer Arrested and Charged with Fraud for Selling Dozens of Forged Artworks over Five YearsRead the Press Release
Preet Bharara, United States Attorney for the Southern District of New York, and Diego Rodriguez, the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced the arrest of ERIC IAN HORNAK SPOUTZ, a/k/a “Robert Chad Smith,” a/k/a “John Goodman,” a/k/a “James Sinclair,” on charges of wire fraud in connection with the sale of dozens of forged artworks by renowned American artists, such as Willem De Kooning, Franz Kline, and Joan Mitchell. SPOUTZ was arrested in Los Angeles today and will be presented before U.S. Magistrate Judge Gail Standish of the Central District of California this afternoon.
Manhattan U.S. Attorney Preet Bharara said: “As alleged, Eric Spoutz used false and fictitious provenance to peddle his forged artwork to unsuspecting buyers, claiming they were masterpieces from Willem De Kooning, Franz Kline and Joan Mitchell. Our Office has a long history of investigating – and prosecuting – those who try to contaminate the art world with fraudulent artwork. Thanks to the outstanding investigative work by the FBI, Spoutz’s alleged forgery mill is no longer in business.”
FBI Assistant Director-in-Charge Diego Rodriguez said: “As alleged, Eric Spoutz created an entire world of fiction to make a profit—from the fraudulent paintings he was selling, to the phony letters and receipts for provenance. The only real thing in this situation seems to be the financial losses the victims have incurred for purchasing what they thought were true works of art, whether for investment purposes or personal enjoyment.”
According to the allegations contained in the Complaint[1] and other documents in the public record, and statements made in court:
Between 2010 and March 2015, SPOUTZ repeatedly sold works of art he falsely claimed were by well-known artists, using forged documents to convince buyers of the authenticity of those works. During the course of the scheme, SPOUTZ sold dozens of fraudulent works of art – which he attributed to, among others, Willem De Kooning, Franz Kline, and Joan Mitchell – through various channels, including auction houses and on EBay.
SPOUTZ was publicly accused of selling forged works of art as early as 2005, after which he began selling them under various aliases, particularly “Robert Chad Smith” and “John Goodman.” To deceive his victims into believing the works of art were authentic, SPOUTZ created and provided forged receipts, bills of sale, and letters from deceased attorneys and other individuals. These documents falsely indicated that SPOUTZ, in the guise of one of his false identities, had inherited or purchased dozens of works by these artists.
Despite his efforts to create false histories for the artwork, investigators identified multiple inconsistencies and errors in SPOUTZ’s forged provenance documents. Many of the purported transactions took place before SPOUTZ was born, and the forged letters included non-existent addresses both for the purported sender and various parties referenced as sources of the artworks. SPOUTZ also consistently used a single distinctive typesetting when forging documents purportedly authored by entirely different art galleries in different decades regarding unrelated transactions. In one instance, investigators located the original letter used by SPOUTZ as a model for one of his forgeries in a collection at a private university, which holds a collection of letters from the individual whose identity SPOUTZ used to create a false story of inheritance.
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SPOUTZ, 32, of Mount Clemens, Michigan, is charged with one count of wire fraud, which carries a maximum sentence of 20 years in prison. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge.
Unknown victims may have purchased artwork from SPOUTZ unwittingly under provenance documents using historical names such as “Betty Parsons Gallery,” “Larry Larkin,” “Henry Hecht,” and “Julius or Jay Wolf.” If you believe you are a victim and purchased a fraudulent painting, please call the New York Art Crime Team at 212-384-1000, attention Special Agent Chris McKeogh or Special Agent Meridith Savona.
The case is being prosecuted by the Office’s Money Laundering and Asset Forfeiture Unit. Assistant United States Attorney Andrew C. Adams is in charge of the prosecution.
The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint set forth below constitute only allegations, and every fact described should be treated as an allegation.
Mexican National Pleads Guilty to Illegal Use of Social Security NumberRead the Press Release
U.S. Attorney Kenneth A. Polite announced that SERGIO GALVEZ-VELAZQUEZ, age 40, a citizen of Mexico, pled guilty today to illegal use of a Social Security Number.
According to court documents, GALVEZ-VELAZQUEZ illegally obtained a Louisiana Identification Card from the Louisiana DMV office in Houma by using a Social Security number that did not belong to him.
GALVEZ-VELAZQUEZ faces a maximum term of imprisonment of five years, a maximum fine of $250,000, a maximum term of supervised release of three years, and a mandatory $100 special assessment. U.S. District Judge Sarah S. Vance set sentencing for May 4, 2016.
U.S. Attorney Polite praised the work of the United States Department of Homeland Security, Homeland Security Investigations, in investigating this matter. Assistant U.S. Attorney Spiro G. Latsis is in charge of the prosecution.
McDowell County Assistant Prosecutor pleads guilty to Federal tax crimeRead the Press Release
BECKLEY, W.Va. – A McDowell County Assistant Prosecuting Attorney pleaded guilty today to a federal tax crime, announced Acting United States Attorney Carol Casto. Jason Ray Grubb, 38, of Beaver, entered his guilty plea in federal court to failing to pay employment taxes.
Grubb admitted that while working as a lawyer in private practice, he had an employee from whom he withheld taxes. Instead of withholding and paying those taxes as required under federal law, he kept the money and did not pay the Internal Revenue Service. Grubb also admitted that he failed to pay personal income taxes for a number of years, and that he falsified vouchers sent to West Virginia Public Defender Services, including 51 days on which he billed for over 24 hours of work. Grubb has agreed to pay restitution for his failure to pay over $247,000 in federal taxes, overbilling Public Defender Services more than $126,000, and not paying a financing company, Daniels Capital Corporation, for more than $29,000 in advances.
He faces up to five years in federal prison and a $10,000 fine when he is sentenced on May 12, 2016.
This case was investigated by the Internal Revenue Service and the West Virginia Commission on Special Investigations. Assistant United States Attorneys Meredith George Thomas and Eric Bacaj handled the prosecution. The plea hearing was held before United States District Judge Irene C. Berger.
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Mask-Wearing Robber Sentenced to 32 Years in PrisonRead the Press Release
PHILADELPHIA – Blair Thomas, Jr., 30, of Lansdowne, PA, was sentenced today to 384 months in prison for robbing a bank, attempting to rob postal employees at two post offices, and with being a convicted felon in possession of a firearm. A federal jury, on April 15, 2015, returned guilty verdicts in the case. In addition to the prison term, U.S. District Court Judge Gerald A. McHugh ordered three years of supervised release, restitution in the amount of $1,891, and a $600 special assessment.
In each robbery and robbery attempt, Thomas wore a special effects, movie quality mask as a disguise, and in each robbery attempt, he armed himself with a .45-caliber Ruger semi-automatic handgun. On January 22, 2014, Thomas entered United States Post offices in Yeadon, PA, and in Darby, PA, wearing the face mask and armed with the handgun, in one instance brandishing the gun, and demanded ten $1,000 money orders from postal clerks. The following day, January 23, 2014, Thomas entered a Wells Fargo Bank in Springfield, PA wearing the special effects mask and displayed a note announcing a robbery. Tellers at the bank gave Thomas approximately $1,890. Surveillance video of the robberies was disseminated to local news outlets. Law enforcement received a tip which led Postal Inspectors to the mask manufacturer who in turn led them to Blair Thomas.
On January 29, 2014, a search warrant was executed on Thomas’ home, and inspectors recovered the special effects face mask and the firearm used in the robberies.
The case was investigated by the United States Postal Inspection Service and the Springfield, Yeadon, and Darby Police Departments. It was prosecuted by Assistant United States Attorney Jessica Natali.
Maryland Man Sentenced to 10 Years for Transporting Child Pornography into United StatesRead the Press Release
A Maryland man was sentenced to 10 years in prison today for transporting child pornography into the United States, Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Robert L. Capers of the Eastern District of New York announced.
Victor Otubu, 50, previously pleaded guilty to transporting child pornography. U.S. District Judge Dora L. Irizarry of the Eastern District of New York also ordered Otubu to serve 10 years of supervised release following his prison sentence.
In connection with his plea, Otubu admitted that when he arrived at John F. Kennedy International Airport on Sept. 6, 2014, from Nigeria, his suitcase contained an external hard drive and several DVDs containing hundreds of child exploitation files. Otubu was arrested on Sept. 10, 2014, in Houston as he attempted to flee prosecution by boarding a flight back to Lagos, Nigeria.
HSI’s Cyber Crimes Center Child Exploitation Investigations Unit and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) High Tech Investigations Unit investigated the case. CEOS Trial Attorney Amy Larson and Assistant U.S. Attorney Ameet Kabrawala of the Eastern District of New York 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.
Manhattan U.S. Attorney Announces Conviction of Jose Luis Gracesqui on Murder-For-Hire ChargesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, James Hunt, the Special Agent in Charge of the New York Division of the Drug Enforcement Administration (“DEA”), William J. Bratton, the Police Commissioner of the City of New York (“NYPD”), and Joseph D’Amico, Superintendent of the New York State Police (“NYSP”), announced that JOSE LUIS GRACESQUI was found guilty Tuesday of conspiracy to commit murder-for-hire, murder-for-hire, and murder in connection with a narcotics conspiracy for his role in the murder of a 28-year old Manhattan man in 1999. GRACESQUI was convicted after a three-week jury trial before U.S. District Judge P. Kevin Castel.
Manhattan U.S. Attorney Preet Bharara said: “Thanks to the efforts of the dedicated agents, detectives, and prosecutors who relentlessly pursued justice, this cold-case murder of an innocent 28-year old man has now been solved and prosecuted. We hope seeing justice done brings some measure of peace to Richard Diaz’s family.”
DEA Special-Agent-in-Charge James Hunt said: “This conviction exemplifies the significant role violence plays in the infrastructure of drug trafficking. I commend the New York Drug Enforcement Task Force and the U.S. Attorney's Office Southern District of New York for their diligent work throughout this three week jury trial.”
NYPD Commissioner William J. Bratton said: “It is our hope that this conviction brings some level of comfort to the victim’s family. I commend the efforts of the NYPD investigators and our law enforcement partners who worked to bring this individual to justice.”
According to the evidence introduced at trial, other proceedings in this case, and documents previously filed in Manhattan federal court:
JOSE LUIS GRACESQUI, a/k/a “Luis Perez,” a/k/a “Ramon Ortiz,” a/k/a “Onel Colon,” a/k/a “Muffler,” was a member of a crew who committed violent robberies, kidnappings, and beatings of drug dealers. In the summer of 1999, GRACESQUI was hired by a major drug dealer in upper Manhattan to kill one of the drug dealer’s customers (“Intended Victim-1”) after Intended Victim-1 and a number of his associates stole heroin from the drug dealer.
On the night of July 19, 1999, GRACESQUI and a member of his crew saw Intended Victim-1 in a car with another person and began following Intended Victim-1 through Manhattan. When the car with Intended Vicitm-1 stopped at a red light, GRACESQUI got out of the car in which he had been, approached the car with Intended Victim-1, and began shooting. The shots hit both Intended Victim-1 and the driver of the car, Richard Diaz. Richard Diaz was able to drive a short distance to the Henry Hudson Parkway, until Diaz lost consciousness and died. Intended Victim-1 sustained injuries but did not die.
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JOSE LUIS GRACESQUI, 45, of Queens, faces a mandatory minimum sentence of life in prison. The potential sentence is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. Sentencing is scheduled for June 10, 2016, before Judge Castel.
Mr. Bharara praised the investigative work of the DEA New York Drug Enforcement Task Force, which comprises agents and officers of the DEA, NYPD, and the New York State Police.
This case is being prosecuted by the Office’s Violent and Organized Crime Unit. Assistant United States Attorneys Laurie A. Korenbaum, Brendan F. Quigley, and Rebekah Donaleski are in charge of the prosecution.
Man Indicted for Armed Robbery at East Aurora PharmacyRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051BUFFALO, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that a federal grand jury in Buffalo, NY has returned a two count indictment charging Ryan Peltan, 30, formerly of East Aurora, NY, with armed robbery of a pharmacy and possession of firearm in furtherance of crime of violence. The charges carry a mandatory minimum penalty of seven years in prison, a maximum of 20 years, a fine of $250,000, or both.
Assistant U.S. Attorney Joel L. Violanti, who is handling the case, stated that according to the indictment, the defendant entered Larwood’s Pharmacy, located at 597 Oakwood Ave. in East Aurora, on October 24, 2015, and took, by force, a large amount of controlled substances. As reported publicly, during the course of the robbery, Peltan displayed a firearm and threatened the owner, two customers, and a 16 year old clerk before fleeing the pharmacy.
On October 26, 2016, police in Akron, Ohio were investigating a suspicious motor vehicle in a mall parking lot. During the investigation, officers observed the defendant and another individual in a car that contained 23 firearms and numerous amounts and types of controlled substances. These controlled substances were traced to Larwood’s Pharmacy, and were identified as the controlled substances taken from the armed robbery that occurred at Larwood’s. Peltan and the other individual were arrested and remain in custody in Akron, Ohio.
The indictment is the culmination of an investigation on the part of the East Aurora Police Department, under the direction of Chief Shane Krieger and the Drug Enforcement Administration, under the direction of Special Agent in Charge James J. Hunt, New York Field Division.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
Local Man Admits Participation in California to Pittsburgh Cocaine Trafficking RingRead the Press Release
PITTSBURGH - A Pittsburgh resident pleaded guilty in federal court to a charge of conspiracy to possess with intent to distribute and distribute 500 grams or more of cocaine, United States Attorney David J. Hickton announced today.
Michael Lyons, 40, pleaded guilty to one count before United States District Judge Mark R. Hornak.
In connection with the guilty plea, the court was advised that in 2013, the Federal Bureau of Investigation and other agencies joined forces in a multi-agency wiretap investigation of drug trafficking and violence in the Homewood section of Pittsburgh. The interception of wire and electronic communications began in December 2013 and continued through the end of August 2014. During that timeframe, Michael Lyons was intercepted over the wire conspiring with others to possess with intent to distribute and distribute cocaine, which was shipped from California to the Western District of Pennsylvania through the United States Postal Service or commercial carrier.
Judge Hornak scheduled sentencing for June 3, 2016. The law provides for a minimum sentence of five years in prison, a maximum sentence of 40 years in prison, a fine of not more than $5,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history of the defendant.
Pending sentencing, the court continued the defendant’s detention.
Assistant United States Attorney Tonya Sulia Goodman is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation, the Greater Pittsburgh Safe Streets Task Force, Wilkinsburg Police Department, Allegheny County Sheriff’s Office, Pennsylvania Office of the Attorney General, Munhall Police Department, Duquesne Police Department, Monroeville Police Department, Allegheny County Police Department, West Mifflin Police Department, Bellevue Police Department, and the Pittsburgh Police conducted the investigation that led to the prosecution of Michael Lyons.
Lanham Man Sentenced to 54 Months in Prison for Credit Card Fraud Scheme with Losses of More Than $100,000 in Three MonthsRead the Press Release
Greenbelt, Maryland – U.S. District Judge Peter J. Messitte sentenced Rasheed Adedokun, age 26, of Lanham, Maryland, today to 54 months in prison, followed by three years of supervised release, for use of unauthorized access devices, aggravated identity theft, and possession of device making equipment, arising from a scheme to use the personal identifying information, credit card and debit card numbers of victims to purchase goods and services worth more than $100,000. Judge Messitte also entered an order requiring Adedokun to pay restitution of $107,403.61.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge James Murray of the United States Secret Service - Washington Field Office; Interim Chief Henry P. Stawinski of the Prince George’s County Police Department; Colonel William M. Pallozzi, Superintendent of the Maryland State Police; and Chief Murray “Jay” Farr of the Arlington County, Virginia Police Department.
According to Adedokun’s plea agreement, on May 14, 2009, he used the credit/debit card of Victim 1 to make over $1,200 in unauthorized purchases in just a few days. On July 11, 2009, Adedokun and three co-conspirators were captured on store surveillance cameras making unauthorized purchases totaling $7,799.10 using the credit/debit cards of nine other victims. On August 5, 2009, Adedokun was arrested by Maryland State Police. Troopers recovered 17 debit cards in Adedokun’s pants pockets and an additional 63 debit cards were found at his residence. Examination of the cards revealed that 18 of the cards’ magnetic strips had been re-encoded with victims’ credit card account information. During a search of Adedokun’s residence, law enforcement also recovered four pages of Social Security Administration screen printouts containing the names and Social Security numbers of 34 individuals, a credit card encoding machine and a computer. A forensic examination of the computer revealed a software program designed to check the validity of a given credit card number, and additional files that contained the names and credit/debit card account numbers that appeared to be assigned to other co-conspirators.
Adedokun was responsible for losses of $107,403.61. Four other co-conspirators have pleaded guilty to their roles in the scheme and are awaiting sentencing. Adetokunbo Babatunde was sentenced to 30 months incarceration and restitution in the amount of $107,403.61. Ridwan Kekere-Ekun was sentenced to one year and one day and restitution in the amount of $107,403.61. Two others are awaiting sentencing. A fifth co-conspirator also pleaded guilty and was sentenced to time served and ordered to pay restitution of $35,000.
Today’s announcement is part of the efforts undertaken in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.
United States Attorney Rod J. Rosenstein commended the U.S. Secret Service, Prince George’s County Police Department, Maryland State Police, and the Arlington County, Virginia Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Bryan E. Foreman and Special Assistant U.S. Attorney Jennifer L. Wine, who are prosecuting the case.
Kansas Man Pleads Guilty in Plot to Explode Car Bomb at Fort Riley in Manhattan, KansasRead the Press Release
John T. Booker Jr., 21, of Topeka, Kansas, pleaded guilty today to attempting to detonate a vehicle bomb on the Fort Riley military base in Manhattan, Kansas.
Assistant Attorney General for National Security John P. Carlin and U.S. Attorney Barry Grissom of the District of Kansas made the announcement.
Booker pleaded guilty before U.S. District Judge Carlos Murguia of the District of Kansas to one count of attempted use of a weapon of mass destruction and one count of attempted destruction of government property by fire or explosion. Sentencing will be scheduled at a later date. The parties have stipulated to a sentence of 30 years in federal prison.
“John Booker admitted that he intended to kill U.S. military personnel on American soil in the name of ISIL,” said Assistant Attorney General Carlin. “Thankfully, law enforcement was able to safely identify and disrupt this threat to the brave men and women who risk their lives to defend our country. The National Security Division’s highest priority is countering terrorist threats and protecting American lives by holding accountable those who plot to attack us.”
“If this defendant had succeeded, American soldiers would have died,” said U.S. Attorney Grissom. “The investigators and the attorneys who worked on this case were our line of defense against terrorism. They kept us safe.”
In his guilty plea, Booker admitted he intended to kill American soldiers and to assist ISIL’s fight against the United States. His plan called for constructing a bomb containing 1,000 pounds of ammonium nitrate. Booker intended to trigger the bomb himself and die in the process, and filmed a video he intended Americans to see after his death.
“You sit in your homes and think this war is just over in Iraq,” he said in the video. “Today we will bring the Islamic State straight to your doorstep.”
Unbeknownst to Booker, the bomb that he constructed was made with inert materials, and the two men working with him were undercover informants for the FBI.
The FBI began investigating Booker in March 2014 after he posted on his Facebook page that he wanted to commit jihad. Booker admitted that he tried to enlist in the U.S. Army in order to commit an insider attack against American soldiers like the one at Fort Hood in Texas, but his deadly plans were thwarted when he was denied entry into the Army. In October 2014, Booker began communicating with an undercover FBI informant. He told the undercover FBI informant that he dreamed of being a fighter in the Middle East, and proposed capturing and killing an American soldier.
In March 2015, Booker was introduced to another FBI informant who he believed would help him plan an attack. Booker said he wanted to detonate a suicide bomb because he couldn’t be captured, all the evidence would be destroyed, and he would be guaranteed to hit his target. On March 10, 2015, Booker made a video filmed at Freedom Park near Marshall Army Airfield at Fort Riley in which he pledged allegiance to Abu Bakr al Baghdadi, the leader of ISIL. That month, he rented a storage unit in Topeka where the bomb would be assembled.
On April 10, 2015, Booker and the informants drove to an area near Fort Riley that Booker believed to be a little-used utility gate where they could enter Fort Riley undetected. He was arrested when he made the final connections on the device that he believed would arm the bomb.
The investigation was conducted by the FBI Joint Terrorism Task Force. The case is being prosecuted by Assistant U.S. Attorney Tony Mattivi and David Smith of the District of Kansas, and Trial Attorneys Josh Parecki and Rebecca Magnone of the National Security Division’s Counterterrorism Section.
Kansas Man Pleads Guilty in Plot to Explode Car Bomb at Fort RileyRead the Press Release
KANSAS CITY, KAN. - John T. Booker Jr., 21, of Topeka, Kansas, pleaded guilty today to attempting to detonate a vehicle bomb on the Fort Riley military base in Manhattan, Kan.
U.S. Attorney Barry Grissom of the District of Kansas and Assistant Attorney General for National Security John P. Carlin made the announcement.
Booker pleaded guilty before U.S. District Judge Carlos Murguia of the District of Kansas to one count of attempted use of a weapon of mass destruction and one count of attempted destruction of government property by fire or explosion. Sentencing will be set for a later date. The parties have stipulated to a sentence of 30 years in federal prison.
“If this defendant had succeeded, American soldiers would have died,” said U.S. Attorney Grissom. “The investigators and the attorneys who worked on this case were our line of defense against terrorism. They kept us safe.”
“John Booker admitted that he intended to kill U.S. military personnel on American soil in the name of ISIL,” said Assistant Attorney General Carlin. “Thankfully, law enforcement was able to safely identify and disrupt this threat to the brave men and women who risk their lives to defend our country. The National Security Division’s highest priority is countering terrorist threats and protecting American lives by holding accountable those who plot to attack us.”
In his guilty plea, Booker admitted he intended to kill American soldiers and to assist ISIL’s fight against the United States. His plan called for constructing a bomb containing 1,000 pounds of ammonium nitrate. Booker intended to trigger the bomb himself and die in the process, and filmed a video he intended Americans to see after his death.
“You sit in your homes and think this war is just over in Iraq,” he said in the video. “Today we will bring the Islamic State straight to your doorstep.”
Unbeknownst to Booker, the bomb that he constructed was made with inert materials, and the two men working with him were undercover informants for the FBI.
The FBI began investigating Booker in March 2014 after he posted on his Facebook page that he wanted to commit jihad. Booker admitted that he tried to enlist in the U.S. Army in order to commit an insider attack against American soldiers like the one at Fort Hood in Texas, but his deadly plans were thwarted when he was denied entry into the Army. In October 2014, Booker began communicating with an undercover FBI informant. He told the undercover FBI informant that he dreamed of being a fighter in the Middle East, and proposed capturing and killing an American soldier.
In March 2015, Booker was introduced to another FBI informant who he believed would help him plan an attack. Booker said he wanted to detonate a suicide bomb because he couldn’t be captured, all the evidence would be destroyed, and he would be guaranteed to hit his target. On March 10, 2015, Booker made a video filmed at Freedom Park near Marshall Army Airfield at Fort Riley in which he pledged allegiance to Abu Bakr al Baghdadi, the leader of ISIL. That month, he rented a storage unit in Topeka where the bomb would be assembled.
On April 10, 2015, Booker and the informants drove to an area near Fort Riley that Booker believed to be a little-used utility gate where they could enter Fort Riley undetected. He was arrested when he made the final connections on the device that he believed would arm the bomb.
The investigation was conducted by the FBI Joint Terrorism Task Force. The case is being prosecuted by Assistant U.S. Attorney Tony Mattivi and David Smith of the District of Kansas, and Trial Attorneys Josh Parecki and Rebecca Magnone of the National Security Division’s Counterterrorism Section.
Justice Department Announces New Acting Pardon AttorneyRead the Press Release
The Justice Department announced today that Robert A. Zauzmer will become the new Acting Pardon Attorney effective immediately.
Zauzmer, the Chief of Appeals in the U.S. Attorney’s Office of the Eastern District of Pennsylvania, has been a key player in the department’s implementation of both the 2013 Smart on Crime initiative and the U.S. Sentencing Commission’s retroactive sentence reductions.
“Bob’s long-standing commitment to criminal justice reform and his knack for devising and implementing the department’s sentencing reduction policies made him a natural choice to serve as Pardon Attorney,” said Deputy Attorney General Sally Q. Yates. “Bob also shares my unwavering dedication to the president’s clemency initiative. Given his experience and dedication, I am confident that Bob will hit the ground running.”
“As someone who has been part of the criminal justice system for more than 25 years, I have long been troubled by the imposition of disproportionately lengthy sentences, even as long as life imprisonment, that were imposed on low-level drug offenders on the basis of laws and policies that have since been changed,” said Zauzmer. “I have dedicated much of the past decade to assisting in the efforts to right some of those unfairly long sentences, and it is my profound honor to aid the president in using his clemency power to continue to restore the sense of proportionality and fairness that is at the heart of our justice system.”
As part of his efforts on behalf of the department, Zauzmer has testified multiple times before the U.S. Sentencing Commission on sentencing guideline issues, including the retroactive application of reductions in drug sentences. He also trained federal prosecutors nationwide on how to apply retroactivity in a way that provides relief to all eligible inmates in the most efficient manner possible. From 2012 to 2014, Zauzmer served as a member of the Attorney General’s Advisory Committee (AGAC), working closely with Attorney General Loretta E. Lynch and Deputy Attorney General Yates at a time that they served as chair and vice-chair, respectively, of the AGAC.
The Office of the Pardon Attorney assists the president in the exercise of executive clemency. Under the Constitution, the president’s clemency power extends only to federal criminal offenses. All requests for executive clemency for federal offenses are directed to the Pardon Attorney for investigation and review. After review and recommendation by the Pardon Attorney, the Deputy Attorney General makes a recommendation to the president for final disposition of each application. Executive clemency may take several forms, including pardon, commutation of sentence, remission of fine or restitution, and reprieve.
In December 2013, President Obama directed the department to prioritize applications for clemency from inmates who were sentenced under outdated policies and would have received a lesser sentence under current policies and laws. Since the clemency initiative was announced in April 2014, the president has granted 187 commutations, more than the last five presidents combined.
Jefferson County Man Sentenced to 151 Months on Cocaine Related ChargesRead the Press Release
A Jefferson County man was sentenced on January 26, 2016, to federal prison on cocaine related charges, James L. Porter, Acting United States Attorney for the Southern District of Illinois, announced today.
Darrain D. Bowdry, 30, of Mt. Vernon, Illinois, was sentenced to 151 months in federal prison, with three years’ supervised release following his imprisonment, and fined $400. Bowdry had previously pleaded guilty to two counts in a federal indictment. Count 1 charged that on November 4, 2014, at approximately 2:36 p.m., Bowdry knowingly and intentionally distributed cocaine. Count 2 charged that on November 4, 2014, at approximately 4:05 p.m., Bowdry knowingly and intentionally distributed cocaine.
The investigation in this case was conducted by the Joint Narcotics Unit of the Mt. Vernon Police Department and the Jefferson County Sheriff’s Department.
The case is being handled by Assistant United States Attorney George Norwood.
Honduran National Pleads Guilty to Illegal ReentryRead the Press Release
U.S. Attorney Kenneth A. Polite announced that MARCELLO ORDONEZ-RIVAS, age 37, a citizen of Honduras, pled guilty today to a one-count indictment with illegal reentry of a removed alien.
According to court documents, ORDONEZ-RIVAS was found in the United States on September 3, 2015, after having been previously deported on May 8, 2009.
ORDONEZ-RIVAS faces a maximum term of imprisonment of two years, a maximum fine of $250,000, a maximum term of supervised release of one year, and a mandatory $100 special assessment. U.S. District Judge Ivan L.R. Lemelle set sentencing on April 27, 2016.
U.S. Attorney Polite praised the work of the United States Department of Homeland Security in investigating this matter. Assistant U.S. Attorney Spiro G. Latsis is in charge of the prosecution.
Former U.S. Citizen Pleads Guilty to Tax Fraud Related to Swiss Financial AccountRead the Press Release
Used Hong Kong Entity and Foreign Accounts in Switzerland, Monaco and Singapore to Conceal Funds
A former U.S. citizen residing in Switzerland pleaded guilty today to one count of filing a false income tax return, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney Dana J. Boente of the Eastern District of Virginia.
“U.S. taxpayers have been given ample opportunity to come forward, disclose their secret foreign accounts, and come into compliance,” said Acting Assistant Attorney General Ciraolo. “Those individuals and entities who rolled the dice in the hope of remaining anonymous are facing the consequences. The Tax Division remains committed to investigating and prosecuting individual taxpayers with undeclared foreign financial accounts, as well as the financial institutions, bankers, financial advisors and other professionals who facilitate the concealment of income and assets offshore. And as today’s guilty plea clearly indicates, the department’s reach is well beyond Switzerland.”
According to court documents, in 2006, Albert Cambata, 61, established Dragonflyer Ltd., a Hong Kong corporate entity, with the assistance of a Swiss banker and a Swiss attorney. Days later, he opened a financial account at Swiss Bank 1 in the name of Dragonflyer. Although he was not listed on the opening documents as a director or an authorized signatory, Cambata was identified on another bank document as the beneficial owner of the Dragonflyer account. That same year, Cambata received $12 million from Hummingbird Holdings Ltd., a Belizean company. The $12 million originated from a Panamanian aviation management company called Cambata Aviation S.A. and was deposited to the Dragonflyer bank account at Swiss Bank 1 in November 2006.
“IRS Criminal Investigation will continue to pursue those who do not pay the taxes they owe to the United States,” said Special Agent in Charge Thomas Jankowski of the Internal Revenue Service-Criminal Investigation, Washington, D.C. Field Office. “Today’s plea is a reminder that we are committed to following the money trail across the globe and will not be deterred by the use of sophisticated international financial transactions that hide the real ownership of income taxable by the United States.”
On his 2007 and 2008 federal income tax returns, Cambata failed to report interest income earned on his Swiss financial account in the amounts of $77,298 and $206,408, respectively. In April 2008, Cambata caused the Swiss attorney to request that Swiss Bank 1 send five million Euros from the Swiss financial account to an account Cambata controlled at the Monaco branch of Swiss Bank 3. In June 2008, Cambata closed his financial account with Swiss Bank 1 in the name of Dragonflyer and moved the funds to an account he controlled at the Singapore branch of Swiss Bank 2.
In 2012, Cambata, who has lived in Switzerland since 2007, went to the U.S. Embassy in Bratislava, Slovakia, to renounce his U.S. citizenship and informed the U.S. Department of State that he had acquired the nationality of St. Kitts and Nevis by virtue of naturalization.
U.S. District Judge Claude Hilton of the Eastern District of Virginia set sentencing for April 15. Cambata faces a statutory maximum sentence of three years in prison and a fine of up to $250,000. As part of his plea agreement, Cambata agreed to pay $84,849 in restitution to the Internal Revenue Service (IRS).
Acting Assistant Attorney General Ciraolo and U.S. Attorney Boente thanked special agents of IRS-Criminal Investigation, who investigated the case, and Assistant Chief Todd Ellinwood of the Tax Division and Assistant U.S. Attorney Mark D. Lytle of the Eastern District of Virginia, who prosecuted the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Former Postal Employee Convicted of Conspiracy ChargesRead the Press Release
St Louis, MO – QUENTIN COOK, Florissant, MO, was convicted of diverting mail believed to contain clothing, marijuana and other items to addresses that he and his co-defendants controlled for their personal gain. Cook and his co-defendants were former Postal employees of the Network Distribution Center in Hazelwood. The three-day trial was held before United States District Judge Ronnie L. White.
According to court documents and testimony presented at trial, Edward Lewis, Sean West, Korey Howard and Quentin Cook are former employees of the United States Postal Service. West, Howard and Cook searched for and identified mail and over-labeled it to redirect it from its original sender’s intended recipient to themselves, Lewis and others. The diverted mail included clothing, marijuana, electronics, computer equipment, pottery and personal effects.
Korey Howard, Florissant, MO; Edward Lewis, Hazelwood, MO; and Sean West, Florissant, MO; pled guilty in December to multiple charges including conspiracy, obstruction of correspondence and theft or receipt of stolen mail. They are scheduled for sentencing in March 2016. A sentencing date has not been set for Quentin Cook.
Each charge carries a maximum penalty of five years in prison, a $250,000 fine or both. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the U.S. Postal Service-Office of Inspector General and the Postal Inspection Service. Assistant United States Attorneys Anthony Franks and Dianna Collins are handling the case for the U.S. Attorney’s Office.
Former Office Manager of Henderson, Kentucky, Law Firm Sentenced to 27 Months in Prison for EmbezzlementRead the Press Release
Ordered to pay $264,867.84 in restitution
Money was used to pay personal expenses and make wire transfers to individuals in South Africa
OWENSBORO, Ky. – The former office manager of a Henderson, Kentucky law firm was sentenced in U.S. District Court yesterday, to 27 months in prison, followed by a three year period of supervised release and ordered to pay full restitution by Chief Judge Joseph H. McKinley, Jr. for embezzling $264,867.84 during a 30-month period, from her former employer, announced United States Attorney John E. Kuhn, Jr.
Krista Kaye Graupner, age 45, of Evansville, Indiana, admitted to committing three counts of wire fraud while employed at the law firm of King, Deep & Branaman (KDB) between June of 2012 and December of 2014.
As office manager, Graupner had access to KDB’s bank accounts and was authorized to write checks and initiate ACH payments out of these accounts. During her guilty plea, on October 21, 2015, Graupner admitted to paying her own personal bills using KDB’s funds.
In October of 2014, Graupner also began wiring money from Henderson to various individuals in South Africa who were part of the scheme. Graupner admitted that she would write checks, either for cash or to herself, drawn upon KDB accounts and then use the cash from the KDB checks to wire the money via Western Union to individuals in South Africa. In perpetuating this crime, Graupner made approximately 200 wire transfers from October 2014 through December 2014.
This case was prosecuted by Assistant United States Attorney Nute A. Bonner and was investigated by the Federal Bureau of Investigation (FBI) and the Henderson Police Department.
Former Chief of Los Angeles Port Police Pleads Guilty to False Statement and Tax Evasion Charges Related to Corruption CaseRead the Press Release
LOS ANGELES – The former chief of police for the Port of Los Angeles pleaded guilty today to federal charges of tax evasion and making false statements to FBI agents who were investigating his acceptance of a bribe in connection with the development of a social networking program that would become the official smartphone app for the Port and would then be marketed to other law enforcement agencies.
Ronald Jerome Boyd, 58, of Torrance, pleaded guilty this afternoon to three offenses and as a result faces a statutory maximum prison term of 11 years in federal prison.
Boyd pleaded guilty before United States District Judge R. Gary Klausner on the day he was scheduled to go to trial on a 16-count indictment that was returned by a grand jury last year.
Boyd pleaded guilty to lying to federal investigators about a scheme related to a smartphone app called Portwatch, which was developed to provide information to the public and to allow citizens to report criminal activity at the port.
In 2011, Boyd and two business partners formed BDB Digital Communications, a company that entered into a revenue-sharing agreement with the company developing Portwatch. The parties involved with BDB intended to generate revenues by marketing and selling a similar app – called Metrowatch – to other government agencies. Boyd was set to receive approximately 13.33 percent of all gross revenues generated by the sale of the Metrowatch application.
According to the indictment in this case, Boyd received his financial interest in return for guaranteeing that the Portwatch contract would be awarded to the company. Prosecutors and the defense have agreed to submit evidence regarding the bribery arrangement to Judge Klausner at sentencing.
Boyd pleaded guilty today to making false statements to special agents with the FBI during an interview in October 2014. Boyd admitted that he lied to the investigators when he denied having any financial interest in Metrowatch or having engaged in a conflict of interest.
“Public officials who use their position of leadership for unlawful personal gain erode the public’s trust in government,” said David Bowdich, the Assistant Director in Charge of the FBI’s Los Angeles Field Office. “Law enforcement officials at all levels have an obligation to uphold the law and remain loyal to the citizens they swore to serve.”
Boyd also pleaded guilty to tax evasion in relation to his personal income tax return for 2011. In his plea agreement, Boyd admitted receiving income from a security business he operated, At Close Range. The income came from the owner of a company doing business with the Port, American Guard Services, and Boyd admitted that he failed to report that income on his personal income tax returns for years 2007 through 2011.
Additionally, Boyd pleaded guilty to a misdemeanor count of failing to file a 2011 tax return for At Close Range. While he pleaded guilty to one only count of failing to file a tax return for At Close Range, Boyd admitted in his plea agreement that he failed to file tax returns for the business for years 2007 through 2011.
The estimated loss of tax revenue to the Internal Revenue Service for Boyd’s conduct was more than $300,000.
“Our largest enforcement program is directed at the portion of American taxpayers who willfully and intentionally violate their known legal duty of filing and paying their fair share of taxes,” said IRS Criminal Investigation’s Special Agent in Charge Erick Martinez.
Judge Klausner scheduled a sentenced hearing for July 25.
The case against Boyd is the product of an investigation by the Federal Bureau of Investigation and IRS – Criminal Investigation.
Former Bull Valley Man Sentenced to 9 Months in Federal Prison for Concealment of Assets from a Bankruptcy TrusteeRead the Press Release
ROCKFORD — A former Bull Valley, Ill. man was sentenced today in federal court by U.S. District Judge Frederick J. Kapala for the concealment of assets from a Bankruptcy Trustee. JOSEPH MICHAEL PHELAN, 52, now of Augusta, Ga., was sentenced to 9 months in federal prison to be followed by 3 months of home confinement. Phelan was also placed on 3 years of supervised release and ordered to pay $80,618.78 as restitution. Phelan was the former President of Phezer Enterprises, Incorporated, located in Crystal Lake, Ill.
Phelan, who pleaded guilty to the charge on Sept. 17, 2015, caused a Chapter 7 Bankruptcy Petition to be filed for Phezer Enterprises on Aug. 18, 2008. According to the written plea agreement, after Phelan closed Phezer Enterprises on Aug. 13, 2008, Phelan had three Phezer employees start cutting up and scrapping unused and used Phezer assets, including sheets of stainless steel and various metals. On Aug. 18, 2008, the day Phezer filed for bankruptcy, Phelan sold 21,182 pounds of stainless steel to a scrap metal company. Phelan personally received $15,251.04 for the steel.
As Phelan admitted in the plea agreement, between Aug. 18, 2008 and Aug. 29, 2008, two Phezer employees sold $13,399.24 worth of Phezer metals to a second scrap metal company. The two employees received cash for the scrap and provided the cash to Phelan.
As further stated in the plea agreement, in September and October 2008, Phelan received two checks totaling $51,968.50 issued to him from another scrap metal company for Phezer metals sold to that company. Phelan deposited both checks in his personal bank account. Phelan did not advise the trustee or a secured creditor that corporate assets had been sold to the three scrap metal companies, or account and deliver to the trustee or the secured creditor the proceeds from the sales of Phezer assets.
The sentencing was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois, and Michael J. Anderson, Special Agent-In-Charge of the Chicago Office of Federal Bureau of Investigation.
The government was represented by Assistant U.S. Attorney Scott R. Paccagnini.
Former Branch Manager of Bank in Manhattan Sentenced for EmbezzlementRead the Press Release
TOPEKA, KAN. - The former branch manager of a bank in Manhattan, Kan., was sentenced Wednesday to 27 months in federal prison for embezzlement, U.S. Attorney Barry Grissom. In addition, she was ordered to pay $277,000 in restitution.
Melissa Vinsonhaler, 34, Manhattan, Kan., pleaded guilty to one count of embezzlement from a bank. In her plea, she admitted the crime occurred while she was branch manager of Kansas State Bank on East Highway 24 in Manhattan, Kan. She embezzled $277,000 from the bank and made false entries in the bank’s ledger to cover up the crime.
Grissom commended the FBI and Assistant U.S. Attorney Rich Hathaway for their work on the case.