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3 February 2016
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.
* * *
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.
Former Bookkeeper for the Pinckneyville Rural Fire Protection District Pleads Guilty to Mail FraudRead the Press Release
Tammy L. Kellerman, 53, of Pinckneyville, Illinois, the former bookkeeper for the Pinckneyville Rural Fire Protection District (PRFPD), pled guilty today in United States District Court in Benton to a four-count information charging her with defrauding that municipal entity, announced James L. Porter, Acting United States Attorney for the Southern District of Illinois. The information to which Kellerman pled guilty alleged that between 2004 and 2013, Kellerman used her trusted position with PRFPD to steal over $450,000 in PRFPD funds. Throughout that time period Kellerman regularly used the United States mail to send unauthorized checks drawn on PRFPD’s bank account to pay her personal credit card bills and other expenses and, thereafter, made false entries in PRFPD’s accounting software to conceal her thefts.
Sentencing was set for May 24, 2016, at 9:30 a.m., at the United States District Courthouse in Benton. On each count Kellerman faces up to 20 years in federal prison, a $250,000 fine, and 3 years of supervised release to follow any term of incarceration imposed. Kellerman will also be required to make full restitution to PRFPD. Kellerman will remain on bond pending sentencing.
The investigation leading to the charges and guilty plea was a cooperative effort by the Federal Bureau of Investigation, the Illinois State Police, the Criminal Investigations Division of the Illinois Department of Revenue, and the Illinois Attorney General’s Office.
The federal case is being prosecuted by Assistant United States Attorney James M. Cutchin.
Former Anamosa Correctional Officer Sentenced to PrisonRead the Press Release
A former Anamosa State Penitentiary correctional officer who smuggled contraband into the prison for prisoner use and illegally used controlled substances while possessing assault rifles on duty was sentenced today to more than four years in federal prison.
Garrett Barton, age 29, from Anamosa, Iowa, received the prison term after an October 13, 2015, guilty plea to one count of a Hobbs Act Extortion Under Color of Official Right (accepting bribes to smuggle contraband into the prison) and one count of being an unlawful drug user in possession of firearms.
In a plea agreement, Barton admitted that from July 2010 until February 2015, he was employed as a correctional officer with the Iowa Department of Corrections, serving most of that time at the Anamosa State Penitentiary. In November 2014, Barton accepted cash from an inmate (provided to him through the inmate’s girlfriend) to smuggle two cell phones into the prison for use by inmates. Other public records demonstrated that Barton also smuggled controlled substances into the prison for inmate use. He also sold and traded controlled substances with other correctional officers. The plea agreement reflects that Barton admitted he was an unlawful drug user while employed at the penitentiary. During that time he possessed four personal firearms, and was issued assault rifles scores of times while standing guard duty in the prison towers.
“This defendant chose to place his own greed above the safety of other Iowa Department of Corrections employees as well as the public he was sworn to protect. Those who agree to smuggle contraband into federal and state prisons can expect to join the inmates from whom they are attempting to profit,” said United States Attorney Kevin W. Techau.
Anamosa State Penitentiary Warden William Sperfslage stated after Barton’s sentencing, “Mr. Barton failed in his mission to the citizens of Iowa that he was hired to protect. He also placed his coworkers in danger by providing contraband to offenders. In doing so, we believe it very appropriate that he is now sentenced to a period of incarceration in a correctional facility.” Sperfslage went on to add, “While we find these actions unacceptable, we also recognize they are his actions and not a reflection on the remaining staff that perform their duties every day and who model the positive behavior we work to instill in the offenders we supervise.”
Barton was sentenced in Cedar Rapids by United States District Court Chief Judge Linda R. Reade. Barton was sentenced to 57 months’ imprisonment and fined $7,500. A special assessment of $200 was imposed. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system.
Barton was released pending imprisonment and is to surrender to the United States Marshals Service in Cedar Rapids on February 24, 2016.
The case was prosecuted by Assistant United States Attorney C.J. Williams and Special Assistant United States Attorney Erin Eldridge, and was investigated by the Federal Bureau of Investigation, the Iowa Division of Criminal Investigation, and the Iowa Department of Corrections.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 15-cr-0091-LRR.
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Floyd County Man Sentenced to 165 Months for Receipt of Child PornographyRead the Press Release
PIKEVILLE, Ky. — A Floyd County man, who previously admitted that he received nearly 30,000 images of child pornography, has been sentenced to 165 months in federal prison.
On January 28, U.S. District Judge Danny C. Reeves has sentenced Bret A. Dunning, 53, for receipt of child pornography. Judge Reeves has also ordered Dunning to pay $10,000 in restitution and has assessed a $1,750 fine. Under federal law, Dunning must serve at least 85 percent of his prison sentence; and upon his release, he will be under the supervision of the U.S. Probation Office for 15 years. Dunning must register as a sex offender for the rest of his life.
Dunning admitted, at his guilty plea, that he had downloaded child pornography images from the internet. In March 2013, Kentucky State Police conducted a search at Dunning’s residence and found the images. The images depicted prepubescent children engaged in sexually explicit conduct.
Dunning pleaded guilty in October of 2015.
Kerry B. Harvey, U.S. Attorney for the Eastern District of Kentucky; Howard Marshall, Special Agent in Charge, FBI; and Rodney Brewer, Kentucky State Police Commissioner, jointly announced the sentence.
The investigation was conducted by Kentucky State Police and the FBI. Assistant U.S. Attorney David A. Marye prosecuted this case on behalf of the federal government.
Florida Man Sentenced to Five Years of Probation for Failing to Pay Child SupportRead the Press Release
Contact: Michael J. Conley
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced that Jeffrey Kingman, 51, of Fort Lauderdale, Florida, was sentenced today in U.S. District Court by Judge Jon D. Levy to five years of probation for failing to pay child support. He was also ordered to pay $101,387.74 in restitution. Kingman pled guilty on September 16, 2015.
According to the evidence, Kingman was ordered to pay $216 per week in child support as part of his July 2007 Maine divorce judgment. Between August 2007 and March 2011, he made 57 reduced and variable child support payments totaling $12,150. As of October 2012, Kingman owed $60,112 in child support. From October 2012 through September 2015, Kingman made no child support payments. To date, Kingman owed $101,387.74 in child support.
The conditions of Kingman’s probation include that he pay restitution and child support. In pronouncing sentence, Judge Levy observed that Kingman has caused great harm to his children by financially and emotionally abandoning them over a period of years. Judge Levy also observed that Kingman had obtained full-time employment enabling him to make payments through a wage garnishment. Judge Levy explained that the statutory purposes of criminal punishment include getting defendants to pay restitution and getting parents to pay child support. If Kingman fails to make restitution or pay child-support while on probation, he faces an additional two years in prison.
The investigation was conducted by the U.S. Department of Health and Human Services, Office of Inspector General and the Maine Department of Health and Human Services, Division of Support Enforcement and Recovery.
Florida Man Pleads Guilty to Bribing Public Official at Georgia Military BaseRead the Press Release
A former agent for a large national trucking company has pleaded guilty for paying bribes to officials at the Marine Corps Logistics Base (MCLB) in Albany, Georgia, in order to obtain lucrative freight-hauling business, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and Acting U.S. Attorney G.F. Peterman III of the Middle District of Georgia.
Ivan Dwight Brannan, 60, of Jupiter, Florida, pleaded guilty before U.S. District Judge W. Louis Sands of the Middle District of Georgia to one count of bribery of a public official.
During his plea, Brannan admitted that from 2006 to 2012, he provided cash and other items of value to Mitchell Potts, a former traffic office supervisor for the Defense Logistics Agency (DLA) at MCLB-Albany, to ensure that his trucking company client was awarded millions of dollars of business at MCLB-Albany. Brannan also admitted that he directed David Nelson, a truck driver, to provide cash and other things of value to both Potts and Jeffrey Philpot, another official in the DLA Traffic Office at MCLB-Albany. From 2006 to 2012, Brannan and Nelson paid at least $120,000 in bribes to Potts and Philpot.
Potts and Philpot both previously pleaded guilty to one count of bribery of a public official and were sentenced to 10 years and seven years in prison, respectively, for their roles in the conspiracy. Nelson pleaded guilty to one count of bribery of a public official on Oct. 7, 2014, and awaits sentencing.
The U.S. Army Criminal Investigation Command, the Naval Criminal Investigative Service and the Defense Criminal Investigative Service are investigating the case. Trial Attorney John Keller of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney K. Alan Dasher of the Middle District of Georgia are prosecuting the case.
Florida Man Pleads Guilty to Bribing Public Official at Georgia Military BaseRead the Press Release
WASHINGTON – A former agent for a large national trucking company has pleaded guilty for paying bribes to officials at the Marine Corps Logistics Base (MCLB) in Albany, Georgia, in order to obtain lucrative freight-hauling business, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and Acting U.S. Attorney G.F. Peterman III of the Middle District of Georgia.
Ivan Dwight Brannan, 60, of Jupiter, Florida, pleaded guilty before U.S. District Judge W. Louis Sands of the Middle District of Georgia to one count of bribery of a public official.
During his plea, Brannan admitted that from 2006 to 2012, he provided cash and other items of value to Mitchell Potts, a former traffic office supervisor for the Defense Logistics Agency (DLA) at MCLB-Albany, to ensure that his trucking company client was awarded millions of dollars of business at MCLB-Albany. Brannan also admitted that he directed David Nelson, a truck driver, to provide cash and other things of value to both Potts and Jeffrey Philpot, another official in the DLA Traffic Office at MCLB-Albany. From 2006 to 2012, Brannan and Nelson paid at least $120,000 in bribes to Potts and Philpot.
Potts and Philpot both previously pleaded guilty to one count of bribery of a public official and were sentenced to 10 years and seven years in prison, respectively, for their roles in the conspiracy. Nelson pleaded guilty to one count of bribery of a public official on Oct. 7, 2014, and awaits sentencing.
The U.S. Army Criminal Investigation Command, the Naval Criminal Investigative Service and the Defense Criminal Investigative Service are investigating the case. Trial Attorney John Keller of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney K. Alan Dasher of the Middle District of Georgia are prosecuting the case.
Five Individuals Arrested and Charged in Connection with a Fraudulent Multi-Million Dollar Income Tax Refund SchemeRead the Press Release
Federal authorities have arrested five individuals, including three sisters, indicted on federal charges in connection with a scheme that involved over 3,200 fraudulent income tax returns that claimed refunds totaling more than $9 million announced United States Attorney Richard L. Durbin, Jr., and Internal Revenue Service-Criminal Investigation (IRS-CI) Special Agent in Charge William Cotter.
A federal grand jury indictment returned in Austin and unsealed this week, charges the following defendants with one count of conspiracy to commit mail fraud:
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Natividad Mercado Medina, a 38–year-old Mexican national who formerly lived in Conroe, TX, and now resides in Atlanta, GA;
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Elizabeth Mercado Medina, a 39–year-old Mexican national who now resides in Atlanta, GA;
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Sofia Mercado Medina, a 36-year-old Mexican national, who now resides in Atlanta, GA;
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Bertin Sanchez Garcia, a 28–year-old Mexican national who resides in Georgetown, TX; and,
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Yajaira Limon Lopez, a 36-year-old Mexican national who resides in Houston.
According to the indictment, in 1996, the Internal Revenue Service began issuing Individual Taxpayer Identification Numbers, or “ITINs”. By obtaining an ITIN, an individual who is already disregarding federal law by living in the United States illegally is given the opportunity to comply with federal law by filing taxes. If the applicant can furnish sufficient proof (i.e. foreign birth certificate, national identification card, passport, etc.) that he or she is living in the United States illegally, the IRS will issue that person an ITIN.
The indictment alleges that beginning in 2014 and under the direction of Natividad Medina, the defendants conspired to steal money from the U.S. Treasury and U.S. taxpayers by exploiting the ITIN system. The Medina sisters began by collecting Mexican identification documents from unknown people in Mexico and used those to fraudulently obtain ITINs. The Medina sisters then used those ITINs to submit false and fraudulent income tax returns to the Internal Revenue Service Center in Austin. They requested that the IRS mail refund checks to residences or to one of more than 200 post office boxes in and around the Houston area which Flores and Lopez had rented and maintained on behalf of the Medina sisters. The indictment alleges that since January 2014, more than 3,200 tax returns associated with the relevant post office boxes and residences controlled by the Medina sisters were filed with the IRS. The claimed refunds from the fraudulent ITIN returns amounted to more than $9 million.
Upon conviction, the defendants face up to 20 years in federal prison.
All of the defendants were arrested on Tuesday. The three Medina sisters remain in federal custody following their arrest in Atlanta. Garcia remains in federal custody following his arrest in Georgetown. Lopez remains in federal custody following her arrest in Houston. Detention hearings are expected to be held tomorrow for the Medina sisters in Atlanta and Lopez in Houston. Garcia’s detention hearing is scheduled for 9:00am on February 16, 2016, before United States Magistrate Judge Mark Lane in Austin.
This case was investigated by the Internal Revenue Service-Criminal Investigation together with the U.S. Postal Inspection Service. Assistant United States Attorney Dan Guess is prosecuting this case on behalf of the Government.
An indictment is merely a charge and should not be considered as evidence of guilt. The defendants are presumed innocent until proven guilty in a court of law.
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Federal Jury Convicts Former SunTrust Mortgage V.P. and Loan OfficersRead the Press Release
ALEXANDRIA, Va. – Mohsin Raza, 51, along with his wife, Humaira Iqbal, 39, and her two brothers, Farukh Iqbal, 41, and Mohammad Ali Haider, 33, all of Chantilly, were convicted today by a federal jury on charges of conspiracy to commit wire fraud affecting a financial institution and various counts of wire fraud affecting a financial institution.
The defendants were indicted on April 23, 2015. According to court records and evidence at trial, in 2005, Raza, then employed at Bank of America, was hired by SunTrust Mortgage (STM) as a vice president tasked with opening an office in Annandale. Raza hired his wife, another former loan officer from Bank of America, and her brothers, Farukh Iqbal and Haider, to work as loan officers. From 2006 until 2007, they falsified loan applications for borrowers and purchased fake tax documents to support the false loan applications. Sun Trust Mortgage underwriters in Richmond approved the loans based in large part upon the fake documents in the files, and borrowers were given loans to buy homes that they could not afford.
Each defendant convicted yesterday will be sentenced on April 29, 2016, and faces a maximum penalty of 30 years in prison on each of the charges. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office; and Laura Wertheimer, Inspector General for the Federal Housing Finance Agency, made the announcement after the verdict was accepted by U.S. District Judge Claude M. Hilton. Assistant U.S. Attorney Jack Hanly and Special Assistant U.S. Attorney Joseph A. Capone are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:15-cr-109.
Executive Director of New York City Non-Profit Organization and His Wife Each Charged with Corruption OffensesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and Mark G. Peters, Commissioner of the New York City Department of Investigation (“DOI”), announced today the filing of criminal charges against KWAME INSAIDOO, the executive director of United Block Association (“UBA”), a non-profit organization, along with his wife ROXANNA PEARSON, a/k/a “Roxanna Insaidoo,” with fraud and embezzlement charges involving UBA’s contracts to operate senior centers for New York City and the misappropriation of over $953,875. INSAIDOO and PEARSON were arrested this morning in Bay Shore, New York, and are scheduled to appear before U.S. Magistrate Judge Gabriel Gorenstein in Manhattan federal court later today.
U.S. Attorney Preet Bharara said: “As alleged, an executive director of a non-profit organization, with the assistance of his wife, abused his position of trust as a provider of public services to enrich himself and his family. Kwame Insaidoo and Roxanna Pearson allegedly diverted close to a million dollars in public funds designed to assist our city’s elderly and spent it on themselves. I thank our partners in this investigation for their work in rooting out public corruption.”
Commissioner Mark G. Peters said: “The defendants stole food from the mouths of New York's seniors, diverting almost a million dollars from programs designed to provide meals and services to the elderly, according to the criminal complaint. Our investigation revealed systemic vulnerabilities in the Department for the Aging's practices that we are now working with the agency to correct so that City services get to New Yorkers in need – not to crooks who prey on them. I thank the U.S. Attorney for his continued partnership in these investigations.” According to the allegations contained in the Complaint[1] unsealed today in Manhattan federal court and publicly available documents:
UBA is a non-profit organization headquartered in New York, New York, that was controlled by INSAIDOO. UBA has agreements with New York City’s Department for the Aging (“DFTA”) to operate and provide healthy meals and programming for four senior centers in Upper Manhattan. UBA had been awarded contracts with New York City to operate each of these senior centers. These contracts are partly federally funded. Since in or about July 2008, DFTA had paid UBA more than $11,682,213 for purported services performed under those agreements.
In connection with the investigation, DOI auditors discovered, among other things, numerous transfers involving a UBA bank account that had never been disclosed to the City and was involved in transfers of substantial funds that were embezzled by INSAIDOO and PEARSON, including through a shell corporation they had set up. INSAIDOO never disclosed this UBA account, or several other UBA bank accounts, to DFTA in violation of the contract requirements as well as requirements mandated by the City. DOI’s auditors also found evidence of various financial irregularities that potentially had an effect on UBA’s ability to provide services under the City’s contracts.
UBA over-reported and over-billed the City for its supposed purchases of food supplies at the same time INSAIDOO was embezzling funds from UBA. At times, UBA appears to have over-reported total expenses of its four senior centers by more than 500%.
INSAIDOO abused his authority as UBA’s Executive Director and, with the assistance of his wife, PEARSON, caused the misappropriation of over $953,875 to himself, PEARSON, and others. INSAIDOO and PEARSON used these funds to pay for personal expenses, including the mortgage for their Long Island residence, as well as its utilities, the purchase of a late-model luxury sedan, and clothes, insurance, and loan payments, among other things.
PEARSON was purportedly a consultant to UBA until 2012 when she was terminated because her relationship with UBA was in violation of the City’s and DFTA’s anti-nepotism polices. However, INSAIDOO continued to authorize compensation to PEARSON even after UBA terminated her.
INSAIDOO, 59, and PEARSON, 62, both of Bay Shore, Long Island, are each charged with conspiracy to commit wire fraud, wire fraud, embezzlement from a federally funded program, and money laundering, each of which carries a maximum penalty of 20 years in prison. Each is also charged with conspiracy to embezzle from a federally funded program, which carries a maximum penalty of five years in prison.
The maximum potential sentences in these cases are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge.
U.S. Attorney Bharara praised the work of DOI and the Criminal Investigators of the United States Attorney’s Office for the Southern District of New York.
The case is being prosecuted by the Office’s General Crimes Unit. Assistant U.S. Attorney Eli J. Mark is in charge of the prosecution.
The charges contained in the Complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth below constitute only allegations, and every fact described should be treated as an allegation.
Doddridge County, WV woman sentenced for selling heroin near playgroundRead the Press Release
CLARKSBURG, WEST VIRGINIA – Amanda Dawn Arth, 35, of Greenwood, West Virginia, was sentenced today to 27 months in prison for heroin trafficking, United States Attorney William J. Ihlenfeld, II, announced.
Arth sold heroin in April 2015 near Broadway Playground in Harrison County, West Virginia. She pled guilty in October 2015 to one count of “Distribution of Heroin within 1,000 feet of a Protected Location.”
Assistant U.S. Attorneys Stephen Vogrin, Andrew Cogar, and former Assistant U.S. Attorney Shawn Morgan prosecuted the case on behalf of the government. The Greater Harrison County Drug and Violent Crime Task Force, a HIDTA-funded initiative, investigated.
U.S. District Judge Irene M. Keeley presided.
Delaware Bank Teller Sentenced for Embezzling $150,000Read the Press Release
WILMINGTON, Del. – Charles M. Oberly, III, United States Attorney for the District of Delaware, announced that Amanda Carey, age 28, of New Castle, Delaware, was sentenced today by the Honorable Richard G. Andrews, United States District Judge for the District of Delaware, to 12 months and one day imprisonment and full restitution. The defendant pleaded guilty to committing bank embezzlement, in violation of 18 U.S.C. § 656, in October 2015.
According to statements made today and documents filed in court, the Judge found that Carey’s offense was a serious matter that warranted a term of imprisonment. Carey had embezzled approximately $150,000 from PNC Bank over the course several months last year. According to statements made at the plea hearing, Carey was employed as a teller supervisor at the bank, beginning in January 2015. On June 19, 2015, Carey did not report to work as scheduled. An audit of the bank’s vaults was conducted, and the bank learned that over $150,000 of cash was missing. An arrest warrant was issued for Carey on July 10, 2015, and she was arrested in Emporia, Virginia on July 28, 2015.
U.S. Attorney Oberly gave the following comments: “At a time when some question the need to incarcerate non-violent offenders, cases like this require some actual punishment. Ms. Carey breached her position of trust at the bank and stole nearly $150,000, none of which was recovered. The public needs to be assured that such crimes cannot simply be resolved or deterred through probation, but require some period of incarceration.”
“Ms. Carey took a large amount of money that wasn’t hers, so she must now face the consequences of her actions. There are laws that govern our society and our job as the FBI is to protect people from the criminals who chose to break those laws,” said Kevin Perkins, Special Agent in Charge of the FBI in Delaware.
This case was investigated by the Federal Bureau of Investigation, with the cooperation and assistance of PNC Bank Investigative Services Group.
Crystal Meth Distributor Sentenced to 324 Months in Federal PrisonRead the Press Release
James L. Porter, Acting United States Attorney for the Southern District of Illinois, announced today that Reymundo Molina-Trujillo, a Mexican national, was sentenced today by United States District Court Judge Nancy J. Rosenstengel to 324 months in federal prison for conspiracy to distribute and possess with intent to distribute controlled substances, namely cocaine and crystal methamphetamine, commonly referred to as "ice."
According to Court documents, Molina-Trujillo pled guilty in October 2015 without a plea agreement. At sentencing, Judge Rosenstengel stated that Molina-Trujillo faced a mandatory minimum sentence of 10 years to life. Judge Rosenstengel sentenced Molina-Trujillo to a total of 324 months in federal prison. There is no parole in the federal prison system. In addition to the prison sentence, Judge Rosenstengel also ordered Molina-Trujillo to serve a 5 year term of supervised release and to pay $100 in court fees.
Evidence in support of this prosecution was obtained in an investigation which was conducted under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF). The OCDETF initiative is designed to bring federal, state, and local law enforcement agencies and resources together to identify, target and dismantle large national and international drug trafficking organizations. Agencies participating in this case include the Drug Enforcement Administration, Internal Revenue Service, Criminal Investigations, and the Metropolitan Enforcement Group of Southern Illinois. Assistant United States Attorney Monica A. Stump prosecuted this case.
Connecticut Man Pleads Guilty to Drug Possession After High-Speed PursuitRead the Press Release
BOSTON – Tyvonne Gooden, 25, of Manchester, Conn. pleaded guilty today to possession with intent to distribute heroin and cocaine. U.S. District Judge Mark G. Mastroianni scheduled sentencing for Aug. 17 2016.
On March 20, 2014, Gooden was in possession of 190 bags of heroin and two bags of cocaine after he was caught in Greenfield, Mass. by law enforcement officers following an hours-long chase. The chase began when Gooden sped away from a Massachusetts State Trooper after being pulled over on the highway for a traffic violation.
The charges of possession with intent to distribute heroin and cocaine each provide a sentence of no greater than 20 years in prison, three to five years of supervised release and a fine of $1 million. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz and Colonel Richard D. McKeon, Superintendent of the Massachusetts State Police, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Deepika Bains Shukla of Ortiz’s Springfield Branch Office.
Citrus County Man Pleads Guilty to Distribution of Child PornographyRead the Press Release
Ocala, Florida – United States Attorney A. Lee Bentley, III announces that Alan Kenneth Thompson, Jr. (33, Crystal River) has pleaded guilty to distributing child pornography. He faces a mandatory minimum sentence of 5 years, up to 20 years, in prison. A sentencing date has not yet been set.
According to the plea agreement, on or about June 2, 2015, agents with U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) determined that Thompson had been using a computer application to post and receive images of child pornography over the Internet. Agents tracked the activity to Thompson’s residence, executed a search warrant, and seized a cellphone and two laptop computers. Forensics analyses confirmed that the devices contained more than 4,500 still images and 84 video files depicting child pornography. Thompson later admitted to the agents that he had been receiving child pornography, and that some of the victims were only four or five years old.
This case was investigated by HSI. It is being prosecuted by Assistant United States Attorney Robert E. Bodnar, Jr.
It is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Chicago Woman Charged with Posing as Federal Housing Official to Scam Homeowners out of CashRead the Press Release
CHICAGO — A Chicago woman has been charged with posing as a federal housing representative to scam homeowners out of cash, federal authorities announced today.
CYNTHIA WALLACE, 45, of Chicago, is charged with one count of falsely assuming and pretending to be an officer of the United States. Last month Wallace posed as an official from the “Federal Housing Authority” and “H.U.D.” in numerous phone calls she placed to Chicago-area homeowners, according to a criminal complaint and affidavit filed in U.S. District Court in Chicago. During the calls, Wallace said the federal government would foreclose on the victims’ homes unless they wired money to a location determined by Wallace.
One of Wallace’s intended targets was a 79-year-old woman from the West Side of Chicago, the complaint states. Two other targets – a husband and wife from south suburban Harvey – wired more than $3,500 to Wallace, according to the complaint.
Wallace was arrested on Jan. 29, 2016, and appeared in court the following day before U.S. Magistrate Judge Michael T. Mason. Judge Mason ordered Wallace detained in federal custody, pending further proceedings. The next court date has not yet been set.
According to the complaint, Wallace – using the alias “Sherry Rice” – told the 79-year-old woman that the woman was entitled to $31,200 from the federal government, but only if the woman first wired $500 to a location determined by Wallace. If the woman didn’t submit the money, Wallace said the government would foreclose on the woman’s home, according to the complaint. The woman notified federal authorities, allowing agents to tape-record subsequent phone calls between her and Wallace. In one recorded call, Wallace told the woman, “We can do whatever we want to do if you’re not compliant,” according to the complaint. The woman did not wire any money.
Wallace later used a different alias – “Shree Box” – to target the Harvey couple, the complaint states. Wallace told the couple that they were qualified for a $12,000 “H.U.D./F.H.A. grant” to avoid foreclosure on their house. In order to receive the purported grant money, Wallace said they had to obtain a home inspection at a cost of $480 – payable via MoneyGram to a location determined by Wallace, the complaint states. The couple wired the money. In a series of subsequent phone calls, Wallace told the couple that they could qualify for a larger grant, a low-interest mortgage loan and mortgage insurance if they wired additional funds, according to the complaint. The couple submitted the additional payments, but then notified federal authorities.
Wallace was arrested when she attempted to claim an additional $1,500 from the couple at a currency exchange on the South Side. The purported MoneyGram was actually a ruse set up by federal authorities, the complaint states.
Wallace is not employed by the Federal Housing Administration, which is a division of the U.S. Department of Housing and Urban Development.
The arrest was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Brad Geary, Special Agent-in-Charge of the U.S. Department of Housing and Urban Development’s Office of Inspector General in Chicago; and Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.
The public is reminded that a complaint is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines.
The government is represented by Assistant U.S. Attorneys Matthew S. Ebert and Maribel Fernandez-Harvath.
To report suspected fraud, logon to https://www.hudoig.gov/report-fraud or call 1-800-347-3735.
Caldwell Man Sentenced to Prison for Gun CrimeRead the Press Release
BOISE – Isaac Bright, 22, of Nampa, Idaho, was sentenced today to 27 months in prison for unlawful possession of a firearm, U.S. Attorney Wendy J. Olson announced. Senior U.S. District Judge Edward J. Lodge also ordered Bright to serve three years of supervised release and have no contact with gang members. The federal sentence imposed will run consecutively with a state sentence that the defendant is now serving. Bright was found guilty on November 5, 2015.
According to court documents, law enforcement stopped a vehicle in which Bright was a passenger because of a traffic violation. During the stop, Bright lied to the officer about his identity and the fact that he was on felony probation at the time. Officers ultimately were able to determine Bright’s identity and confirmed that he had an outstanding warrant for his arrest. During a search of his person, the officer found a loaded handgun in his waistband. Bright was prohibited from possessing a gun because he was previously convicted of the felony crime of kidnapping on May 2, 2014, in Canyon County. Bright was also known to be a documented Norteno gang member.
Bright was charged as a result of an investigation by the Treasure Valley Metro Violent Crimes Task Force, which focused on the “Norteno” Northside gang that is active in Nampa and other parts of the Treasure Valley. Fourteen individuals were indicted on drug and gun charges as a result of the investigation. So far, eleven defendants have been sentenced. Guadalupe Serrano, 35, of Caldwell, was sentenced on April 21, 2015, to 75 months in prison for possession of methamphetamine with intent to distribute and for possessing firearms in furtherance of the drug trafficking crime. Nicole Danelle Nieto, 31, of Nampa, was sentenced on May 26, 2015, to 41 months in prison for distributing methamphetamine. Jose Manuel Menchaca, 35, of Nampa, was sentenced on May 28, 2015, to 60 months in prison for distributing methamphetamine. On June 17, 2015, Brandi Larrea, 31, of Nampa, was sentenced to 48 months in prison for distributing methamphetamine and Tara Noelle Rivera, 30, of Nampa, was sentenced to 24 months in prison for distributing methamphetamine. Johnny Lee Martinez, 33, of Nampa, was sentenced on July 20, 2015, to 57 months in prison for distributing methamphetamine. Michael David Bradshaw, 31, of Nampa, was sentenced on August 6, 2015, to 66 months in prison for distributing methamphetamine. Kenny P. Breedlove, 35, of Porterville, California, was sentenced on October 22, 2015, to 110 months for possession of methamphetamine with the intent to distribute. Guillermo Farias Jr., 29, of Nampa, was sentenced on October 26, 2015, to time served and three years of supervised release for his role in assisting with methamphetamine distribution. Richard Lobato, 51, of Nampa, was sentenced on December 3, 2015, to 60 months for distribution of methamphetamine. Veronica Cantu, 26, of Nampa, was arrested in Michigan in November and is set for trial in April. One defendant, Ruben Rodriguez, 36, of Nampa, has an outstanding warrant.
These cases are the result of a joint investigation by the Treasure Valley Metro Violent Crime Task Force and the Organized Crime and Drug Enforcement Task Force (OCDETF). The Treasure Valley Metro Violent Crime Task Force is comprised of federal, state and local agencies, including the Federal Bureau of Investigation; Bureau of Alcohol, Tobacco, Firearms and Explosives; Boise Police Department; Ada County Sheriff’s Office; Caldwell Police Department; Nampa Police Department; Meridian Police Department; Canyon County Sheriff’s Office; and Idaho Department of Probation and Parole. The Organized Crime and Drug Enforcement Task Force (OCDETF), includes the cooperative law enforcement efforts of the Federal Bureau of Investigation; Drug Enforcement Administration; Bureau of Alcohol, Tobacco, Firearms and Explosives; U. S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Internal Revenue Service-Criminal Investigation; and U.S. Marshals Service. The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations.
These cases are being prosecuted by the Special Assistant U.S. Attorney hired by the Treasure Valley Partnership and the State of Idaho to address gang crimes. The Treasure Valley Partnership is comprised of a group of elected officials in southwest Idaho dedicated to regional coordination, cooperation, and collaboration on creating coherent regional growth. For more information, visit treasurevalleypartners.org.
CFO of Berlin, New Hampshire Business Pleads Guilty in Multi-million Dollar Bank Fraud CaseRead the Press Release
The Office of the United States Attorney for the District of Vermont stated that Steven D. Griffin, 59, of Berlin, New Hampshire, pleaded guilty before Chief Judge Christina Reiss yesterday to a charge of making a false statement to a financial institution. The charge alleged that in or about March 2011, Griffin submitted or caused to be submitted inflated figures for assets of Isaacson Structural Steel, Inc. (“ISSI”), including inventory, to Passumpsic Savings Bank, and other banks that provided ISSI loans totaling over $12 million, including a $2 million loan guaranteed by the Small Business Administration. Based on the plea agreement, Griffin faces up to three years in prison. Griffin agreed to a restitution order for $500,000.
Griffin was part owner,Vice President and CFO of ISSI, which before its bankruptcy was one of the largest businesses in the North Country. ISSI fabricated steel used in commercial construction. It entered into construction contracts to provide not only the steel for commercial buildings, but also to provide subcontractor services, principally the erection of the steel. ISSI purchased steel and fabricated the various pieces of steel needed for each contract at its Berlin, New Hampshire location and then shipped the steel to building sites. Early last year, ISSI’s CEO Arnold Hanson pleaded guilty to conspiring to submit false financial statements. Sentencings for Hanson and Griffin are scheduled for May 2016.
Griffin’s indictment and Hanson’s conspiracy charge allege that between August 2007 and April 2011, ISSI officers regularly submitted false and inflated figures to the banks regarding the value of ISSI’s assets. ISSI submitted these false statements about assets in borrowing base certificates and financial statements. ISSI regularly inflated its assets by one million dollars or more. For example, in August 2007, ISSI officers discussed, and then submitted to the bank, inflated figures for the amount of money owed to ISSI for work done in connection with 303 Third St., a construction project in Boston. In early 2011, officers participated in the submission of an ISSI’s draft financial statement for the financial year 2010, which contained significant overstatements about ISSI’s inventory. That financial statement had an inventory representation of approximately $12 million dollars. In fact, the value of ISSI’s inventory at that time was less than $2 million. Inventory was thus inflated by over $10 million.
In April 2011, the banks learned about issues with ISSI’s inventory figures. By June 2011, ISSI was in bankruptcy, and its assets were later liquidated. The lending banks lost millions of dollars as a result of the fraud. As part of the plea agreement, Griffin admitted that he knowingly submitted false information to the lending banks in 2010 and 2011. At the sentencing hearing, the government anticipates offering evidence showing that Griffin’s criminal activity began as early as 2007.
The United States is represented in this matter by Assistant U.S. Attorneys Paul Van de Graaf and Timothy Doherty. Griffin is represented by Paul Volk, Esq. and Douglas Miller, Esq. The investigation, which is ongoing, is being conducted by the Federal Bureau of Investigation, the Office of Inspector General for the Federal Deposit Insurance Corp., and the Office of Inspector for the Small Business Administration.
Bulger Companion Pleads Guilty to Criminal Contempt ChargeRead the Press Release
BOSTON – Catherine Greig, the longtime companion of convicted killer James “Whitey” Bulger, pleaded guilty today in U.S. District Court in Boston in connection with her refusal to testify before a federal grand jury. The investigation centered on whether others assisted her and Bulger during the 16 years they were fugitives from justice.
Ms. Greig, 64, pleaded guilty to one count of criminal contempt. U.S. District Court Judge F. Dennis Saylor, IV scheduled sentencing for April 28, 2016.
Greig is currently serving an eight year sentence for her 2012 conviction of identity fraud and harboring James J. Bulger.
The charge of criminal contempt provides for a sentence or no greater than life in prison to be served subsequent to her current eight-year prison sentence and a fine. 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 Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Mary B. Murrane of Ortiz’s Major Crimes Unit.