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2 February 2016
Jefferson City Man Sentenced for Distributing, Possessing Child PornRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Jefferson City, Mo., man was sentenced in federal court today for possessing and distributing child pornography over the Internet.
Dominic J. Veit, 40, Jefferson City, was sentenced by U.S. District Judge Brian C. Wimes to eight years and nine months in federal prison without parole.
On April 6, 2015, Veit pleaded guilty to distributing child pornography and to possessing child pornography.
An FBI agent in New York, working on the national Innocent Images investigation in January 2011, identified Veit’s computer as using a peer-to-peer file-sharing network to distribute child pornography. The agent downloaded 31 images of child pornography from Veit’s computer.
On March 3, 2011, a federal search warrant was executed at Veit’s residence. Veit was questioned by law enforcement officers and admitted that he used the file-sharing program to download child pornography over the Internet. Veit had 30 to 40 friends on his network, most of whom had images of child pornography they shared with him in exchange for gaining access to the child pornography files on Veit’s computer.
Investigators discovered thousands of images and four videos of child pornography, including four images of bestiality which depicted bondage, on Veit’s computer.
This case was prosecuted by Assistant U.S. Attorney Lawrence E. Miller. It was investigated by the FBI.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Jacksonville Man Indicted for Attempted Online Enticement, Attempted Production, and Advertising for Child PornographyRead the Press Release
Jacksonville, Florida – United States Attorney A. Lee Bentley, III announces the return of a superseding indictment charging Jon Christopher Stoune (44, Jacksonville) with attempted online enticement of an individual he believed to be a minor child, advertising for child pornography, and attempted production of child pornography. If convicted, he faces a mandatory minimum of 10 years, up to life, in federal prison on the attempted enticement charge. The advertising and attempted production charges each carry a penalty of at least 15 years, up to 30 years, in federal prison. Stoune has been in custody since his arrest on April 21, 2015.
An indictment is merely a formal charge that a defendant has violated one or more federal criminal laws, and every defendant is presumed innocent until, and unless, proven guilty.
This case was investigated by the St. Johns County Sheriff’s Office and the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorney D. Rodney Brown.
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.
Jackson Man Sentenced to Prison for Possession of a Firearm by a Convicted FelonRead the Press Release
Jackson, Miss. – Antoine Johnson, 26, of Jackson, was sentenced today by U.S. District Judge Carlton W. Reeves, to 18 months in prison followed by three years of supervised release for possessing a firearm after having been previously convicted of a felony, announced U.S. Attorney Gregory K. Davis.
On August 9, 2015, members of the Jackson Police Department received information that Johnson was causing a disturbance in the area of Lawnview Place in Jackson. Officers encountered Johnson in the area and determined that he was in possession of a firearm. Johnson’s previous conviction was for business burglary in Madison County in 2013.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosive and the Jackson Police Department. It was prosecuted by Assistant U.S. Attorney Patrick Lemon.
Indictment: Retired Wichita Police Lt. Lied About Training He Was Paid to ProvideRead the Press Release
WICHITA, KAN. - A retired Wichita police lieutenant who was paid $56,400 to provide armed engagement training for law enforcement officers was indicted Tuesday on charges of embezzling federal grant funds.
Kevin P. Vaughn, 51, Wichita, Kan., who retired in March 2015 after 28 years with the Wichita Police Department, is charged with one count of embezzling U.S. Department of Homeland Security funds, one count of mail fraud, three counts of wire fraud and one count of money laundering.
The indictment alleges Vaughn falsified reports to make it appear his company, Red Mist Tactical, had completed all of 15 eight-hour classes the company agreed to provide. The money for the training came from a grant by the U.S. Department of Homeland Security/Federal Emergency Management Agency (DHS/FEMA) to the Kansas Highway Patrol and the North Central Regional Planning Commission.
The indictment alleges Vaughn:
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Falsely reported conducting training in McPherson, Kan., on May 27 and May 28, 2015. In fact, the training sessions took place on June 3 and 4, 2015, after the deadline for the training to be completed. In addition, the training sessions were four hours long, not the eight hours Vaughn’s company had agreed to provide. Vaughn submitted falsified sign-up sheets with forged officers’ signatures.
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Falsely reported conducting eight hours of training on May 22, 2015, during the Wichita Police Department Ladies Range Day. In fact, the training lasted four hours and it was not approved by the police department.
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Falsely reported offering training in Sumner County on April 27 and May 1, 2015. In fact, there was no training on those days. Vaughn submitted fabricated sign-up sheets for those dates.
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Falsely reported offering training in Sumner County on April 20, 21, 22, 23 and 24, 2015. In fact, there was no training on those days. He submitted fabricated sign-up sheets for those dates.
Upon conviction, the crimes carry the following penalties:
Count 1 (embezzlement): A maximum penalty of 10 years and a fine up to $250,000.
Count 2 and 6 (mail fraud): A maximum penalty of 20 years and a fine up to $250,000.
Counts 3, 4 and 5 (wire fraud): A maximum penalty of 20 years and a fine up to $250,000 on each count.
Count 7 (Money laundering): A maximum penalty of 10 years and a fine up to $250,000.
The FBI and the Wichita Police Department investigated. Assistant U.S. Attorney Debra Barnett is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
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Idaho Residents are Targets of Telephone ScammersRead the Press Release
BOISE – The United States Attorney’s Office and the United States Marshals Service are advising Idaho residents to be aware of telephone calls threatening individuals of a pending arrest warrant. During the call, unsuspecting citizens are given the choice to avoid a federal arrest warrant by paying a fine to settle out of court. The individual may be instructed to wire money. The caller may provide a false case number. Because the telephone calls are continuing to occur, the United States Attorney wants the public to be aware of these scam calls. Officers do not notify people of arrest warrants by phone. A valid arrest warrant would be served in person by a Deputy U.S. Marshal or other law enforcement officer. Persons receiving such a telephone call are cautioned not to provide any information and to notify the U.S. Marshals Service immediately.
It was recently reported that an Idaho resident received a phone call from a person claiming that the U.S. Attorney for the District of Idaho had issued a federal warrant for the citizen’s arrest. The call came from someone who identified herself as “Leslie” and claimed to be an investigator with the “Tate Law Firm” in Texas. Leslie told the citizen that she could pay $2,700 to have the arrest warrant cancelled. When the citizen did not agree, “Leslie” transferred her to someone who posed as a lawyer and tried to convince the citizen to pay the $2,700 amount. When the citizen still would not agree, the lawyer transferred her back to “Leslie” who offered to resolve the matter for approximately $1,500.
“I urge everyone who receives this type of phone call to be very skeptical,” said Brian T. Underwood, United States Marshal for the District of Idaho. “Those who receive similar calls should contact the local U.S. Marshal’s office to verify, as this is not a typical way or resolving warrant related matters.”
It is a crime for an individual to falsely represent himself or herself as a federal official or Deputy United States Marshal. Accordingly, this scam and any similar fraudulent conduct will be investigated by the U.S. Marshals Service, in partnership with the FBI.
Hayden Septic Waste Business Sentenced for Clean Water Act ViolationRead the Press Release
COEUR D'ALENE - The Rooter Guy, LLC, and its founder Ben Broyles, 62, of Hayden, Idaho, were sentenced today in federal court for violating the Clean Water Act, U.S. Attorney Wendy J. Olson announced. The Rooter Guy, LLC was sentenced to three years organization probation. Ben Broyles, the majority owner and operator of The Rooter Guy, LLC was also sentenced to three years of probation. Chief U.S. District Judge B. Lynn Winmill also ordered that Broyles and his corporation pay a $17,000 fine and $4,000 in restitution to the City of Hayden, and to perform 100 hours of community service. Guilty pleas were entered on November 18, 2015.
According to the plea agreements, between March 17, 2014, and May 16, 2014, the defendants violated the Clean Water Act by pumping septic waste into the City of Hayden’s municipal sewer system operated by the Hayden Area Regional Sewer Board. Although The Rooter Guy LLC is licensed to collect septic waste from commercial and residential customers, it is required to dispose of septic waste at facilities designed to collect and treat waste in accordance with environmental considerations and EPA regulation. Hayden’s municipal sewer system is not designed to accept and treat septic waste.
"Enforcement of federal criminal environmental laws promotes healthy safe communities for all of us,” U.S. Attorney Wendy Olson observed. “Unfortunately, The Rooter Guy LLC put its bottom line above its obligation to conduct its business in a way that protects public safety. The successful investigation and prosecution in this case sends a clear message that businesses who put profits ahead of public safety will be brought to justice."
“Dumping unpermitted septic waste into a wastewater treatment plant not only damages expensive equipment, but can sicken or injure people,” said Scot Adair, Acting Special Agent in Charge of EPA’s criminal enforcement program in Idaho. “By refusing to comply with the law, the defendants jeopardized the health and safety of an entire community. Today’s guilty plea shows that those who ignore this country’s environmental laws can expect to face the consequences in court.”
The case was investigated by the Environmental Protection Agency with the assistance of the City of Hayden, the Hayden Area Regional Sewer Board, Federal Bureau of Investigation, U.S. Forest Service, U.S. Secret Service, and the Kootenai County Sheriff’s Office.
Hammond Woman Pleads Guilty to Mail Fraud and Aggravated Identity Theft for Role in Tax Fraud SchemeRead the Press Release
U.S. Attorney Kenneth A. Polite announced that RAVEN HUGHES, age 28, of Hammond, pled guilty today to mail fraud and aggravated identity theft for engaging in a multi-year tax fraud scheme.
According to court documents, HUGHES obtained the name and social security number of unsuspecting individuals and used that information without their knowledge or authorization to prepare false tax returns that claimed large tax refunds. The refund checks were mailed to numerous Post Office Boxes throughout Louisiana that were opened by HUGHES, including HUGHES’s residence in Hammond. Refund checks were also sent electronically via wire into one of HUGHES’s four bank accounts.
Once the tax refund checks were received, HUGHES falsely endorsed the checks and cashed them. HUGHES also arranged for some of the refunds to be transmitted electronically into bank accounts under her control. In total, HUGHES caused not fewer than 148 federal income tax returns to be submitted in the names of at least 103 different individuals without their knowledge or authorization. As a result of the conduct described above, between 2009 and 2012 HUGHES received approximately $199,050.
HUGHES faces a maximum term of imprisonment of not more than twenty years, followed by up to three years of supervised release, and a $250,000 fine for the count of mail fraud. HUGHES also faces a mandatory consecutive two-year sentence for the commission of aggravated identity theft. U.S. District Judge Susie Morgan set sentencing for May 18, 2016.
U.S. Attorney Polite praised the work of the Internal Revenue Service – Criminal Investigation in investigating this matter. Assistant United States Attorney Jordan Ginsberg is in charge of the prosecution.
Grand Forks Man Sentenced to 20 Years in Prison for Role in Fentanyl ConspiracyRead the Press Release
FARGO - U. S. Attorney Christopher C. Myers announced that on February 1, 2016, Ryan Jon Jensen, 20, was sentenced in U.S. District Court in Fargo to 240 months in prison by Chief U.S. District Judge Ralph Erickson. Jensen was ordered to pay $17, 264.93 in restitution for funeral expenses and was also ordered to serve up to five years supervised release after his sentence.
Jensen had previously pled guilty on February 27, 2015, to the following charges:
1) Conspiracy to Possess with Intent to Distribute and Distribution of Controlled Substances Resulting in Serious Bodily Injury and Death.
2) Distribution of a Controlled Substance Resulting in Serious Bodily Injury
3) Distribution of a Controlled Substance Resulting in Serious Bodily Injury
4) Distribution of a Controlled Substance Resulting in Death
5) Money Laundering Conspiracy
U.S. Attorney Chris Myers noted: "This is a tragic case. There are two kids dead and a number of kids were sent to the hospital from the poison this defendant was distributing in the city of Grand Forks. These substances were readily available for purchase on the Dark Web with the use of a computer. We all need to work together to combat this problem. It is not just a law enforcement problem, but a community problem that needs a community solution. I applaud the steps taken thus far by our state and local partners in Grand Forks to engage the public through education, discussion, and action – we must continue to hold the line together to save lives."
This case is being investigated by the Grand Forks Police Department, Department of Homeland Security - Homeland Security Investigations, the Drug Enforcement Administration, the Royal Canadian Mounted Police, and the Portland (OR) Police Department.
U. S. Attorney Christopher C. Myers and AUSA Scott Schneider are prosecuting the case.
Glen Burnie Woman Sentenced for Writing Fraudulent Prescriptions for OxycodoneRead the Press Release
Baltimore, Maryland – U.S. District Judge J. Frederick Motz sentenced Robin McClosky Andrews, age 51, of Glen Burnie, Maryland today to a year and a day in prison followed by three years of supervised release for conspiring to distribute and possess with intent to distribute oxycodone.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Nicholas DiGiulio, Office of Investigations, Office of Inspector General of the Department of Health and Human Services; Assistant Special Agent in Charge Don A. Hibbert of the Drug Enforcement Administration, Baltimore District Office; and Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation, Baltimore Field Office.
According to her plea agreement, from 2009 until 2012, Andrews stole prescription slips from a doctor she worked for, and wrote fraudulent prescriptions for oxycodone in a number of different names. Her husband had individuals fill the prescriptions at pharmacies and provide him with the pills. The individuals were generally paid $100 for each prescription they filled. The oxycodone pills were then sold to co-defendant Michael Cudnik and others.
More than 350 fraudulent prescriptions were written. Most of the prescriptions were for 90 Percocet 10 milligram pills, totaling 300,000 milligrams of oxycodone. Accordingly, Robin Andrews was responsible for the distribution of at least 300,000 milligrams of oxycodone.
Michael Joseph Cudnik, age 57, of Baltimore, has pleaded guilty to his role in the conspiracy and is scheduled to be sentenced on February 12, 2016 at 10:00 a.m. Robin Andrews’ husband passed away on October 21, 2015.
United States Attorney Rod J. Rosenstein commended the HHS Office of Inspector General, DEA and FBI for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Kenneth S. Clark, who prosecuted the case.
Former White House Employee Pleads Guilty to Taking Part in Time/Attendance SchemeRead the Press Release
WASHINGTON – The former director of switchboard operations at the White House pled guilty today to a charge of theft of government property for a scheme in which she stole over $5,000 through altered time and attendance records, announced U.S. Attorney Channing D. Phillips and Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office.
Andrea Turk, 46, of Upper Marlboro, Md., pled guilty in the U.S. District Court for the District of Columbia. The Honorable Senior Judge Gladys Kessler scheduled sentencing for April 20, 2016. The charge, a felony, carries a statutory maximum of 10 years in prison and potential financial penalties. Under the advisory federal sentencing guidelines, Turk faces up to six months of incarceration and a fine of up to $20,000. She has agreed to pay restitution as well as a forfeiture money judgment of $5,015.
According to a statement of offense, signed by the defendant as well as the government, Turk was the director of switchboard operations at the White House from October 2009 until her termination in August 2013. She was responsible for managing approximately 15 switchboard operators, including oversight of their work schedules and approval of overtime hours. Additionally, she was responsible for final entry and approval of all time and attendance records of the switchboard operators, including one identified in court documents as “Employee A.”
Beginning at least as early as June 2, 2012, through July 27, 2013, Turk used her supervisory position to alter the time and attendance records of “Employee A” to reflect overtime hours that were not actually worked. In turn, “Employee A” paid Turk money generated through the scheme. Over that time-frame, “Employee A” was paid approximately $12,475 for 396 overtime hours, but only actually worked and legitimately earned less than approximately 50 of these hours. As a result, “Employee A” received approximately $10,900 in overtime pay from the United States government to which “Employee A” was not entitled. “Employee A” thereafter paid approximately $5,015 to Turk, mostly through a series of bank transfers.
No other charges were filed in the investigation.
In announcing the plea, U.S. Attorney Phillips and Assistant Director in Charge Abbate commended the work of those who investigated the case from the FBI’s Washington Field Office. They also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialist Tasha Harris, Legal Assistant Angela Lawrence, and Assistant U.S. Attorney Diane Lucas, who assisted with forfeiture issues. Finally, they expressed appreciation for the work of Assistant U.S. Attorney David A. Last, who investigated and prosecuted the matter.
Former U.S. Nuclear Regulatory Commission Employee Pleads Guilty to Attempted Spear-Phishing Cyber-Attack on Department of Energy ComputersRead the Press Release
Charles Harvey Eccleston, 62, a former employee of the U.S. Department of Energy (DOE) and the U.S. Nuclear Regulatory Commission (NRC), pleaded guilty today to a federal offense stemming from an attempted e-mail “spear-phishing” attack in January 2015 that targeted dozens of DOE employee e-mail accounts.
The guilty plea was announced by Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Channing D. Phillips of the District of Columbia and Assistant Director in Charge Paul M. Abbate of the FBI’s Washington Field Office.
Eccleston pleaded guilty in the U.S. District Court for the District of Columbia to one count of attempted unauthorized access and intentional damage to a protected computer. In his guilty plea, Eccleston admitted scheming to cause damage to the computer network of the DOE through e-mails that he believed would deliver a computer virus to particular employees. An e-mail spear-phishing attack involves crafting a convincing e-mail for selected recipients that appears to be from a trusted source and that, when opened, infects the recipient’s computer with a virus.
“Eccleston admitted that he attempted to compromise, exploit and damage U.S. government computer systems that contained sensitive nuclear weapon-related information with the intent of allowing foreign nations to gain access to that information or to damage essential systems,” said Assistant Attorney General Carlin. “Protecting our national assets from cyber intrusions is one of our highest priorities. We must continue to evolve and remain vigilant in our efforts and capabilities to confront cyber-enabled threats and aggressively detect, disrupt and deter them.”
“This prosecution underscores our commitment to prosecute those who carry out or plan cyber-attacks against our government, whether they are in the United States or in remote locations overseas,” said U.S. Attorney Phillips. “Thanks to the work of the FBI, this former federal employee was arrested before he could do any damage and he now is being held accountable for actions that could have threatened our national security.”
“Charles Harvey Eccleston is a former U.S. Government employee who, motivated by greed, was thwarted in his attempt to sell information to a foreign intelligence service to enable a cyber-attack against our information systems,” said Assistant Director in Charge Abbate. “Today’s guilty plea is a testament to the dedication of the FBI and prosecutorial team, along with our federal and foreign partners, to relentlessly pursue and bring to justice an individual who sought to misuse his position to betray the country.”
Eccleston, a U.S. citizen who had been living in Davao City in the Philippines since 2011, was terminated from his employment at the NRC in 2010. He was detained by Philippine authorities in Manila, Philippines, on March 27, 2015, and deported to the United States to face U.S. criminal charges. He has been in custody ever since.
According to court documents, Eccleston initially came to the attention of the FBI in 2013 after he entered a foreign embassy in Manila and offered to sell a list of over 5,000 e-mail accounts of all officials, engineers and employees of a U.S. government energy agency. He said that he was able to retrieve this information because he was an employee of a U.S. government agency, held a top secret security clearance and had access to the agency’s network. He asked for $18,800 for the accounts, stating they were “top secret.” When asked what he would do if that foreign country was not interested in obtaining the U.S. government information the defendant was offering, the defendant stated he would offer the information to China, Iran or Venezuela, as he believed these countries would be interested in the information.
Thereafter, Eccleston met and corresponded with FBI undercover employees who were posing as representatives of the foreign country. During a meeting on Nov. 7, 2013, he showed one of the undercover employees a list of approximately 5,000 e-mail addresses that he said belonged to NRC employees. He offered to sell the information for $23,000 and said it could be used to insert a virus onto NRC computers, which could allow the foreign country access to agency information or could be used to otherwise shut down the NRC’s servers. The undercover employee agreed to purchase a thumb drive containing approximately 1,200 e-mail addresses of NRC employees; an analysis later determined that these e-mail addresses were publicly available. The undercover employee provided Eccleston with $5,000 in exchange for the e-mail addresses and an additional $2,000 for travel expenses.
Over the next several months, Eccleston corresponded regularly by e-mail with the undercover employees. A follow-up meeting with a second undercover employee took place on June 24, 2014, in which Eccleston was paid $2,000 to cover travel-related expenses. During this meeting, Eccleston discussed having a list of 30,000 e-mail accounts of DOE employees. He offered to design and send spear-phishing e-mails that could be used in a cyber-attack to damage the computer systems used by his former employer.
Over the next several months, the defendant identified specific conferences related to nuclear energy to use as a lure for the cyber-attack, then drafted emails advertising the conference. The emails were designed to induce the recipients to click on a link which the defendant believed contained a computer virus that would allow the foreign government to infiltrate or damage the computers of the recipients. The defendant identified several dozen DOE employees whom he claimed had access to information related to nuclear weapons or nuclear materials as targets for the attack.
On Jan. 15, 2015, Eccleston sent the e-mails he drafted to the targets he had identified. The e-mail contained the link supplied by the FBI undercover employee which Eccleston believed contained a computer virus, but was, in fact, inert. Altogether, the defendant sent the e-mail he believed to be infected to approximately 80 DOE employees located at various facilities throughout the country, including laboratories associated with nuclear materials.
Eccleston was detained after a meeting with the FBI undercover employee, during which Eccleston believed he would be paid approximately $80,000 for sending the e-mails.
The charge of attempted unauthorized access and intentional damage to a protected computer carries a maximum sentence of 10 years in prison and potential financial penalties. Under the advisory federal sentencing guidelines, Eccleston faces a prison term of 24 to 30 months and a fine of up to $95,000. Sentencing before U.S. District Judge Randolph D. Moss of the District of Columbia is scheduled for April 18, 2016.
The investigation was conducted by the FBI’s Washington Field Office with assistance from the NRC and DOE. The case is being prosecuted by Assistant U.S. Attorney Thomas A. Gillice of the District of Columbia and Trial Attorney Julie A. Edelstein of the National Security Division’s Counterintelligence and Export Control Section. Trial Attorney Scott Ferber of the National Security Division’s Counterintelligence and Export Control Section assisted in the investigation of this matter. The Department of Justice’s Office of International Affairs and the government of the Philippines also provided significant assistance.
Eccleston Plea Agreement
Eccleston Statement of Offense
Former U.S. Nuclear Regulatory Commission Employee Pleads Guilty to Attempted Spear-Phishing Cyber-Attack on Department of Energy ComputersRead the Press Release
WASHINGTON – Charles Harvey Eccleston, 62, a former employee of the U.S. Department of Energy (DOE) and the U.S. Nuclear Regulatory Commission (NRC), pleaded guilty today to a federal offense stemming from an attempted e-mail “spear-phishing” attack in January 2015 that targeted dozens of DOE employee e-mail accounts.
The guilty plea was announced by U.S. Attorney Channing D. Phillips of the District of Columbia, Assistant Attorney General for National Security John P. Carlin, and Assistant Director in Charge Paul M. Abbate of the FBI’s Washington Field Office.
Eccleston pleaded guilty in the U.S. District Court for the District of Columbia to one count of attempted unauthorized access and intentional damage to a protected computer. In his guilty plea, Eccleston admitted scheming to cause damage to the computer network of the DOE through e-mails that he believed would deliver a computer virus to particular employees. An e-mail spear-phishing attack involves crafting a convincing e-mail for selected recipients that appears to be from a trusted source and that, when opened, infects the recipient’s computer with a virus.
“This prosecution underscores our commitment to prosecute those who carry out or plan cyber-attacks against our government, whether they are in the United States or in remote locations overseas,” said U.S. Attorney Phillips. “Thanks to the work of the FBI, this former federal employee was arrested before he could do any damage and he now is being held accountable for actions that could have threatened our national security.”
“Eccleston admitted that he attempted to compromise, exploit and damage U.S. government computer systems that contained sensitive nuclear weapon-related information with the intent of allowing foreign nations to gain access to that information or to damage essential systems,” said Assistant Attorney General Carlin. “Protecting our national assets from cyber intrusions is one of our highest priorities. We must continue to evolve and remain vigilant in our efforts and capabilities to confront cyber-enabled threats and aggressively detect, disrupt and deter them.”
“Charles Harvey Ecceleston is a former U.S. Government employee who, motivated by greed, was thwarted in his attempt to sell information to a foreign intelligence service to enable a cyber-attack against our information systems,” said Assistant Director in Charge Abbate. “Today’s guilty plea is a testament to the dedication of the FBI and prosecutorial team, along with our federal and foreign partners, to relentlessly pursue and bring to justice an individual who sought to misuse his position to betray the country.”
Eccleston, a U.S. citizen who had been living in Davao City in the Philippines since 2011, was terminated from his employment at the NRC in 2010. He was detained by Philippine authorities in Manila, Philippines, on March 27, 2015, and deported to the United States to face U.S. criminal charges. He has been in custody ever since.
According to court documents, Eccleston initially came to the attention of the FBI in 2013 after he entered a foreign embassy in Manila and offered to sell a list of over 5,000 e-mail accounts of all officials, engineers and employees of a U.S. government energy agency. He said that he was able to retrieve this information because he was an employee of a U.S. government agency, held a top secret security clearance and had access to the agency’s network. He asked for $18,800 for the accounts, stating they were “top secret.” When asked what he would do if that foreign country was not interested in obtaining the U.S. government information the defendant was offering, the defendant stated he would offer the information to China, Iran or Venezuela, as he believed these countries would be interested in the information.
Thereafter, Eccleston met and corresponded with FBI undercover employees who were posing as representatives of the foreign country. During a meeting on Nov. 7, 2013, he showed one of the undercover employees a list of approximately 5,000 e-mail addresses that he said belonged to NRC employees. He offered to sell the information for $23,000 and said it could be used to insert a virus onto NRC computers, which could allow the foreign country access to agency information or could be used to otherwise shut down the NRC’s servers. The undercover employee agreed to purchase a thumb drive containing approximately 1,200 e-mail addresses of NRC employees; an analysis later determined that these e-mail addresses were publicly available. The undercover employee provided Eccleston with $5,000 in exchange for the e-mail addresses and an additional $2,000 for travel expenses.
Over the next several months, Eccleston corresponded regularly by e-mail with the undercover employees. A follow-up meeting with a second undercover employee took place on June 24, 2014, in which Eccleston was paid $2,000 to cover travel-related expenses. During this meeting, Eccleston discussed having a list of 30,000 e-mail accounts of DOE employees. He offered to design and send spear-phishing e-mails that could be used in a cyber-attack to damage the computer systems used by his former employer.
Over the next several months, the defendant identified specific conferences related to nuclear energy to use as a lure for the cyber-attack, then drafted emails advertising the conference. The emails were designed to induce the recipients to click on a link which the defendant believed contained a computer virus that would allow the foreign government to infiltrate or damage the computers of the recipients. The defendant identified several dozen DOE employees whom he claimed had access to information related to nuclear weapons or nuclear materials as targets for the attack.
On Jan. 15, 2015, Eccleston sent the e-mails he drafted to the targets he had identified. The e-mail contained the link supplied by the FBI undercover employee which Eccleston believed contained a computer virus, but was, in fact, inert. Altogether, the defendant sent the e-mail he believed to be infected to approximately 80 DOE employees located at various facilities throughout the country, including laboratories associated with nuclear materials.
Eccleston was detained after a meeting with the FBI undercover employee, during which Eccleston believed he would be paid approximately $80,000 for sending the e-mails.
The charge of attempted unauthorized access and intentional damage to a protected computer carries a maximum sentence of 10 years in prison and potential financial penalties. Under the advisory federal sentencing guidelines, Eccleston faces a prison term of 24 to 30 months and a fine of up to $95,000. Sentencing before U.S. District Judge Randolph D. Moss of the District of Columbia is scheduled for April 18, 2016.
The investigation was conducted by the FBI’s Washington Field Office with assistance from the NRC and DOE. The case is being prosecuted by Assistant U.S. Attorney Thomas A. Gillice of the District of Columbia and Trial Attorney Julie A. Edelstein of the National Security Division’s Counterintelligence and Export Control Section. Trial Attorney Scott Ferber of the National Security Division’s Counterintelligence and Export Control Section assisted in the investigation of this matter. The Department of Justice’s Office of International Affairs and the government of the Philippines also provided significant assistance.
Former Reno Mortgage Broker Sentenced to Five Years in PrisonRead the Press Release
RENO – A former Reno mortgage broker was sentenced today to five years in prison, three years of supervised release, 150 hours of community service, and ordered to pay restitution for embezzling $260,000 from a Reno company’s employee pension plan, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.
Marcilin Anne Benvin, 56, currently a resident of Douglas, Alaska, pleaded guilty last September to one count of embezzlement and theft from an employee benefit plan, and was sentenced today by U.S. District Judge Larry R. Hicks. Benvin must self-report to federal prison by May 6 at noon.
“The investigation and prosecution of financial crimes, including loan and investment fraud, is currently a top priority of the District,” said U.S. Attorney Bogden. “We work with our local, state and federal law enforcement partners to ensure that individuals who commit this type of crime are brought to justice.”
From approximately 1996 to 2008, Benvin lived and worked as a mortgage broker in Reno, and was the President and operator of Cetus Mortgage, Ltd. (Cetus). Cetus was in the business of providing and servicing loans made by private investors to borrowers, primarily for residential construction and development projects. A Reno painting service company had been investing its employee pension plan money with Cetus for more than 20 years. In November 2006, Benvin told one of the trustees for the pension plan that one of its investment loans had matured. Benvin asked the trustee whether the pension plan wanted to rollover the $260,000 principal into another loan. The plan agreed, and was provided documents, including a promissory note and deed of trust, stating that it was being invested in Maverick Development. As it turned out, the documents were forged and Benvin had failed to invest the loan monies as promised, and had misappropriated the investor funds for herself. To date, the pension plan has not received back any of the $260,000 that it provided to Cetus through Benvin. Cetus closed its business and filed for bankruptcy in 2008.
The case was investigated by the FBI, IRS Criminal Investigation, and the U.S. Department of Labor Employee Benefits Security Administration, and is being prosecuted by Assistant U.S. Attorney Brian L. Sullivan.
This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes. For more information about the task force visit: www.stopfraud.com.
Former Private School Coach Sentenced for Secretly Filming Students Undressing on School Ski TripsRead the Press Release
The former cross country ski coach at a Seattle private school was sentenced today in U.S. District Court in Seattle to eight years in prison for transportation with intent to engage in criminal sexual activity, announced U.S. Attorney Annette L. Hayes. JASON CHRISTOPHER PAUR, 45, of Seattle was arrested by the Royal Canadian Mounted Police in December 2013 at Silver Star ski area in British Columbia, Canada. The arrest came after female students on a school sponsored field trip discovered a video camera had been hidden in their bedroom. The camera had been positioned to video-tape the young students while they got dressed after showering. PAUR pleaded guilty in November 2015. At the hearing U.S. District Judge John C. Coughenour sentenced PAUR to 15 years of supervised release to follow the eight year prison term.
“This betrayal of trust is every parent’s nightmare,” said U.S. Attorney Annette L. Hayes. “I commend the victims, their families and the school who have remained steadfast in the pursuit of justice in this case.”
According to records in the case, the investigation revealed that PAUR had secretly recorded students while on the annual school ski trip in 2011, 2012, and 2013. The camera seized in Canada contained images of students between the ages of 14 and 17 being filmed while changing clothes or after exiting the shower. In addition, PAUR secretly filmed students changing while on a cross country running trip in 2012, and in 2013, and filmed a student changing in a storage room at the private school. PAUR used the pictures for his own sexual gratification. PAUR traveled with the students to Canada knowing that he planned to film them for his own sexual gratification.
PAUR was immediately removed from the field trip by the chaperones who notified police. PAUR was fired by the school, which has fully cooperated with law enforcement. Since his arrest in 2013, PAUR has been in custody either in Canada or in the Federal Detention Center at SeaTac.
The case was investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI). The case was prosecuted by Assistant United States Attorney Kate Vaughan.
Press contact for the U.S. Attorney’s Office on February 2, 2016 is First Assistant United States Attorney Micki Brunner at (206) 553-7970.
Former Judge-Disbarred Lawyer Pleads Guilty to Federal Fraud ChargesRead the Press Release
ALBUQUERQUE – A former New Mexico Workers’ Compensation Administrative Law Judge (ALJ) and disbarred lawyer pleaded guilty today in federal court to defrauding the Social Security Administration (SSA) of more than $40,000.00 and an estate and its beneficiaries of almost $572,000.00. Juanita Roibal-Bradley, 60, of Albuquerque, N.M., entered guilty pleas to one count of failing to disclose an event affecting the continued right to Social Security benefit payments and twelve counts of wire fraud. Under the terms of her plea agreement, Roibal-Bradley will be sentenced to a prison term not to exceed 39 months and will be ordered to pay restitution in an amount to be determined by the court to the victims of her crimes.
The guilty plea was announced by U.S. Attorney Damon P. Martinez, Special Agent in Charge Terry Wade of the FBI’s Albuquerque Division, and Special Agent in Charge Robert Feldt of the Social Security Administration, Office of the Inspector General.
In announcing the guilty plea, U.S. Attorney Damon P. Martinez said, “To protect the public and its faith in our judicial system, the U.S. Attorney’s Office will vigorously prosecute officers of the court who abuse their positions of trust and take advantage of the public.”
“Criminals who prey on innocent victims and cheat a government program that helps retirees and the disabled deserve serious penalties. When an offender is a former judge and attorney, law enforcement and prosecutors need to be even more aggressive to restore public confidence in our legal system,” said Special Agent in Charge Terry Wade of the FBI’s Albuquerque Division. “The FBI thanks the Social Security Administration’s Office of Inspector General for its hard work on this case, and congratulates the U.S. Attorney’s Office on a successful prosecution.”
“The Social Security Administration, Office of Inspector General will vigorously investigate individuals committing fraud against Social Security programs. This instant case represents cooperation amongst agencies to bring to justice those who take advantage of government programs and innocent victims,” said Special Agent in Charge Robert Feldt of the Social Security Administration, Office of the Inspector General.
Roibal-Bradley was charged in a 23-count indictment on Sept. 10, 2015, with one count of defrauding the SSA, twelve counts of wire fraud and ten counts of money laundering. According to the indictment, between Sept. 2007 and March 2011, Roibal-Bradley defrauded the SSA of more than $40,000.00 in disability benefits by failing to disclose that she was employed as a mediator and supervising attorney by the New Mexico Workers’ Compensation Administration and thus not entitled to disability benefits. Roibal-Bradley previously had served as an ALJ at the New Mexico Workers’ Compensation Administration from 2003 to 2007.
The indictment’s wire fraud counts alleged that between March 2012 and June 2013, Roibal-Bradley devised and executed a scheme to defraud an estate and its beneficiaries of almost $571,948.98. In furtherance of the scheme, Roibal-Bradley falsely represented herself to be an attorney authorized to practice law and agreed to provide legal services in administering an estate at a time when New Mexico Supreme Court had prohibited her from the private practice of law. The Court subsequently disbarred Roibal-Bradley in March 2014. As part of the scheme, Roibal-Bradley falsely promised to distribute the estate’s funds to its beneficiaries but instead transferred the funds into her personal bank account and used wire transfers to facilitate the transfer of funds. The indictment alleges that, between April 2012 and Aug. 2012, Roibal-Bradley facilitated eleven wire transfers ranging in amounts of $5,000.00 to $389,503.33 from the estate’s bank account to her personal bank account.
The indictment also charged Roibal-Bradley with laundering the proceeds she derived from her wire fraud activity by transferring those assets to others, including members of her family. The indictment alleges that Roibal-Bradley facilitated eleven transfers of proceeds from her wire fraud activities ranging in amounts of $12,000.00 to 131,492.77 between May 2012 and July 2012.
During today’s change of plea hearing, Roibal-Bradley pleaded guilty to defrauding the SSA and to the twelve wire fraud charges. In her plea agreement, Roibal-Bradley admitted she applied for SSA disability benefit payments in Sept. 2011, and claimed that she had a disability that prevented her from working. The SSA continued to pay Roibal-Bradley disability benefits between March 2008 and March 2011, even though she was working full-time as a mediator and supervising attorney for the New Mexico Workers’ Compensation Administration. In entering her guilty plea, Roibal-Bradley admitted that she failed to notify the SSA that she was capable of full-time gainful employment.
Roibal-Bradley’s plea agreement also details the scheme by which she defrauded an estate and its heirs of almost $572,000.00. In the plea agreement, Roibal-Bradley admitted that she did not tell the administrator of the estate that she was prohibited from engaging in the private practice of law. She also admitted fraudulently transferring $571,948.98 from the estate’s bank accounts into her own bank account between April 2012 and Aug. 2012.
Roibal-Bradley continues to be released on conditions of release and pretrial supervision pending her sentencing hearing, which has yet to be scheduled.
The case was investigated by the Albuquerque office of the FBI and the Social Security Administration’s Office of Inspector General based on a referral from the Disciplinary Board of the New Mexico Supreme Court. Assistant U.S. Attorneys Holland S. Kastrin and Kristopher N. Houghton are prosecuting the case.
Former Jefferson City Bank Officer Sentenced for Stealing $410,000Read the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Jefferson City, Mo., woman was sentenced in federal court today for embezzling $410,000 from the bank where she was employed.
Katherine Nicholle Brown, 29, of Jefferson City, was sentenced by U.S. District Judge Brian C. Wimes to 15 months in federal prison without parole. The court also ordered Brown to pay $410,000 in restitution. Brown voluntary surrendered to begin serving her sentence on Oct. 1, 2015, and remains in federal custody.
Brown was previously employed as the head teller at Hawthorn Bank in Jefferson City. On Sept. 15, 2015, Brown pleaded guilty to the misappropriation of funds by a bank officer. Brown admitted that she embezzled $410,000 from December 2012 to Sept. 19, 2014, by taking money from the bank vault for her personal use. According to court documents, Brown used the money she embezzled to buy various vehicles, make home improvements and upgrade her wedding rings.
Brown was employed at Hawthorn Bank from April 9, 2007, through Sept. 30, 2014. Brown became head teller and, on Jan. 26, 2010, she became responsible for managing the vault at the main branch of the bank. She was also responsible for ordering money from the Federal Reserve Bank. Additionally, if any of the bank’s branches in Jefferson City, Columbia or California needed money for their branch, they would contact Brown and she would ship the funds to them. Brown was also responsible for daily and monthly audits of the vault.
Brown admitted that she began taking money from the vault when her husband had shoulder surgery in 2012 and could not work. She took the money in small amounts, and would place it in her pockets. Brown then plugged in certain amounts in the vault book to cause the vault book total to match the vault balance in the bank’s computer accounting system. Brown also admitted that, when the bank underwent an internal audit in December 2012, she made false entries into the computer system to conceal the fact that the vault did not match the computer system.
On Sept. 19, 2014, just prior to taking maternity leave, Brown prepared and shipped five bags of cash of varying denominations to the Federal Reserve Bank. She prepared and labeled the bags, which were bar-coded and tamper proof. She reported that the total amount of cash shipped to the Federal Reserve Board was $844,000; however, when the Federal Reserve Board received and counted the money, they found it to be only $434,000.
The Federal Reserve Board reported the shortage to the bank, which conducted an audit of the vault. The audit revealed that certain entries made in the vault book reflecting cash amounts sent to Columbia, Mo., and California, Mo., bank branches were $200,000 higher than the branches had actually ordered. As a result, the vault did not contain as much cash as had been reported on the bank’s computer accounting system. Auditors concluded that Brown had to report to the Federal Reserve Board that $844,000 had been shipped so that it would balance to the bank’s accounting system.
This case was prosecuted by Assistant U.S. Attorney Jim Lynn. It was investigated by the FBI.
Former Freedom Industries owner sentenced for role in chemical spillRead the Press Release
CHARLESTON, W.Va. – A former owner of Freedom Industries was sentenced today to three years of probation and ordered to pay a $20,000 fine for a Refuse Act violation connected to the 2014 Elk River chemical spill, announced Acting United States Attorney Carol Casto. Charles E. Herzing, of McMurray, Pennsylvania, previously pleaded guilty in March 2015 to unlawfully discharging refuse matter. Herzing is one of six former officials of Freedom Industries, in addition to Freedom Industries itself as a corporation, to be prosecuted for federal crimes associated with the chemical spill.
On January 9, 2014, a major chemical leak was discovered in Charleston at the above-ground storage tank area owned and operated by Freedom Industries (Freedom) on the Elk River. Freedom used these storage tanks to keep and process chemicals, and the leak consisted primarily of 4-methylcyclohexane methanol (MCHM), a chemical used in the coal mining industry as a cleansing agent. A significant amount of MCHM leaked into the Elk River, flowed into a water treatment plant, and contaminated the water supply of Charleston and the surrounding areas for several days. Freedom did not have a permit required by law that would have allowed the company to discharge MCHM into the Elk River.
Herzing, along with co-defendants Dennis P. Farrell and William E. Tis, owned Freedom until December 2013, when they sold their shares to a Pennsylvania corporation. From 2004 until the 2013 sale, Herzing served as the Vice President of Freedom. In this role, Herzing had the responsibility and the authority to ensure that Freedom and its facility on the Elk River complied with the law.
Freedom had a permit issued by West Virginia’s Department of Environmental Protection that allowed for the discharge of storm water and groundwater subject to monitoring and reporting requirements. However, this permit did not allow for the discharge of MCHM, and required the development and maintenance of a storm water plan and a groundwater plan. Generally, storm water and groundwater plans identify potential sources of pollution and outline steps to prevent, contain, and reduce pollutants.
Herzing admitted that he was aware of the permit and was put on notice that Freedom was required to have a storm water plan. He further admitted that he had the responsibility to ensure that Freedom complied with the permit by having a storm water and groundwater plan in place. During Herzing's tenure as a corporate officer, Freedom never developed a storm water or groundwater plan, which was a contributing cause to the chemical spill.
Herzing is the second defendant sentenced as part of the investigation into the chemical spill. Robert J. Reynolds, of Apex, North Carolina, who worked as an environmental consultant with Freedom, was sentenced yesterday for a Clean Water Act violation.
Freedom itself, which has been in bankruptcy since shortly after the chemical spill, pleaded guilty to violating the Clean Water Act, the unlawful discharge of refuse matter in violation of the Refuse Act, and violating an environmental permit. Freedom is scheduled to be sentenced on February 4, 2016.
William E. Tis, of Verona, Pennsylvania, a former owner of Freedom, pleaded guilty in March 2015 to the unlawful discharge of refuse matter in violation of the Refuse Act. Tis is scheduled to be sentenced on February 8, 2016.
Michael E. Burdette, of Dunbar, a plant manager for Freedom, pleaded guilty in March 2015 to violating the Clean Water Act by negligently discharging a pollutant, and is scheduled to be sentenced on February 4, 2016.
Dennis P. Farrell, of Charleston, a former Freedom president and owner, pleaded guilty in August 2015 to violating the federal Refuse Act and violating a permit by failing to have a pollution prevention plan. Farrell is scheduled to be sentenced on February 11, 2016.
Gary Southern, of Marco Island, Florida, the president of Freedom at the time of the spill, pleaded guilty in August 2015 to violating the Clean Water Act, unlawfully discharging refuse matter in violation of the Refuse Act, and violating a permit by failing to have a pollution prevention plan. Southern is scheduled to be sentenced on February 17, 2016.
The investigation of the chemical spill was conducted by the Federal Bureau of Investigation and the Environmental Protection Agency’s Criminal Investigation Division. Assistant United States Attorneys Philip H. Wright, Larry R. Ellis, and Eric P. Bacaj, as well as the Environmental Protection Agency’s Regional Criminal Enforcement Counsel Perry D. McDaniel, are handling the prosecutions. United States District Judge Thomas E. Johnston imposed the sentence, and will preside over the remaining sentencing hearings associated with the chemical spill.
Former Evansville man indicted on forgery and money laundering chargesRead the Press Release
Evansville –United States Attorney Josh J. Minkler announced today that a former Evansville resident who worked as the business manager of a Carmi, Illinois, oil and gas company was indicted on one count of making forged securities and four counts of money laundering. Kent W. Cutchin, 60, formerly of Evansville, was indicted by a federal grand jury last week and had his initial appearance before a federal magistrate on Monday.
“The United States Attorney’s Office is cracking down on white collar crime,” said Minkler. “Even if you use sophisticated means to steal $837,000, you are still a thief and thieves need to go to federal prison.”
Cutchin was the office manager for R Energy, a company headquartered in Carmi, Illinois, which performs oil and gas field services in multiple states, including Indiana. Cutchin was responsible for paying bills, maintaining office payroll, ordering supplies, and purchasing inventory.
Between December 2011 and February 2015, Cutchin is alleged to have forged the signature of R Energy’s company president on over 500 checks. He is alleged to have written the checks to himself and purchased items for his personal use rather than buying items in the ordinary course of business. The indictment alleges that he used these fraudulently obtained funds to make improvements on his home in Evansville and to purchase an all-terrain utility vehicle. In total, the amount of theft is alleged to total approximately $837,251.
This case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service, Criminal Investigation.
IRS Criminal Investigation Division Special Agent in Charge, James Robnett, stated, “Together with the United States Attorney’s Office, we are committed to following the money. Money laundering constitutes a serious threat to the integrity of our financial system and honest hardworking Americans are paying the price.”
FBI Special Agent in Charge W. Jay Abbott said, “The FBI will continue to work with our law enforcement partners, specifically the Internal Revenue Service (IRS), to focus our efforts on these white collar subjects and ensure they are brought to justice.”
According to Assistant United States Attorney Kyle M. Sawa, who is prosecuting the case for the government, Cutchin could face up to 10 years imprisonment on each count if convicted.
An indictment is merely a charge and not evidence of guilt. All defendants are presumed innocent until proven otherwise in federal court.
Former Davis, Ill. Resident Sentenced to 26 Months in Federal Prison for Failure to Register as a Convicted Sex OffenderRead the Press Release
ROCKFORD — A former Davis, Ill. resident was sentenced in federal court today by U.S. District Judge Frederick J. Kapala for failure to register under the federal Sex Offender Registration and Notification Act (“SORNA”). MARK STEPHEN CURTIS, 29, was sentenced to 26 months in federal prison, to be followed by 5 years of supervised release.
Curtis pleaded guilty to the charge on Oct. 26, 2015. In the written plea agreement, Curtis admitted that he was a sex offender required to register in Illinois under SORNA. Curtis moved from North Carolina to Davis, Ill. during September 2014, and remained a resident in Davis, Ill. until at least Oct. 19, 2014. Curtis admitted that he did not register as a sex offender as required, despite knowing that he needed to register within three days of moving to a new state.
The sentencing was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois, and Edward Gilmore, United States Marshal for the Northern District of Illinois.
The government was represented by Assistant U.S. Attorney Michael D. Love.
Former Aurora Resident Sentenced to 20 Years in Prison for $4.8 Million International Timeshare FraudRead the Press Release
CHICAGO — An Aurora native who operated several fraudulent Mexican real estate businesses was sentenced today to 20 years in prison for his role in a $4.8 million swindle of timeshare owners.
GILBERT BRETT FREEMAN, 44, led a scheme to defraud more than 1,400 owners by falsely promising that he would sell their Mexican timeshares to corporate buyers. Freeman and others collected payments from the owners for fictitious fees and taxes that he claimed were required to complete Mexican real estate deals, and that he promised would be refunded upon closing. In reality, Freeman had no intention of selling the timeshares or reimbursing the owners.
Freeman instead used the money to fund a lavish lifestyle that included a penthouse apartment in an oceanfront resort, Rolex watches, numerous vacations, and the rental of a Lamborghini in Las Vegas for $1,399 per day. Some of his victims resided in the Chicago area.
Freeman, a native of Aurora who most recently resided in Puerto Vallarta, Mexico, pleaded guilty in 2014 to five counts of wire fraud. U.S. District Judge Elaine E. Bucklo imposed the 240-month sentence in federal court in Chicago.
“The defendant’s actions had a devastating impact on countless victims,” Assistant U.S. Attorney Christopher J. Stetler argued in the government’s sentencing memorandum. “Rather than using his victims’ money to fund timeshare sales, the defendant chose to use that money to bankroll an extravagant lifestyle.”
Authorities arrested Freeman in July 2012 in Las Vegas. According to his plea declaration, Freeman was involved with various Mexican-based companies, including International Resorts Resale, Resort Closing Services, Timeshare Consolidators, Timeshare Liquidators, and Transfer My Timeshare. At Freeman’s direction, “lead generators” contacted the timeshare owners and explained that the companies could coordinate the sale of their properties. When an owner expressed interest, company employees known as “liners” followed up to arrange the first payment, which the liners claimed would be refundable even though it wasn’t.
“Closers” from the companies were then brought in to convince the owners to make additional payments to cover the bogus fees and taxes that were purportedly needed to complete the deal, according to the charges. Closers and liners received commissions for each payment collected from the timeshare owners.
The final step involved purported “escrow employees,” who claimed to represent independent businesses and who assured the owners that their money would be securely held until reimbursement. In reality, there were no such escrow agreements, and the so-called escrow representatives were actually working for one of Freeman’s companies, according to the charges.
In all, eleven defendants have been charged in the scheme, which began in 2008 and continued in various forms until January 2015. Four defendants, including Freeman, have pleaded guilty, while the others have pleaded not guilty and are awaiting trial.
The sentencing of Freeman was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Michael J. Anderson, Special Agent-in-Charge of the Chicago office of the Federal Bureau of Investigation; and C. Steven Baker, Director of the Midwest Region of the Federal Trade Commission. The government is being represented by Mr. Stetler.
Final Defendant in Shoplifting Ring Sentenced to PrisonRead the Press Release
SACRAMENTO, Calif. — The final defendant in a shoplifting ring that stole over $2.5 million in retail goods and resold them on eBay was sentenced today to three years in prison, United States Attorney Benjamin B. Wagner announced.
Jason Nathaniel Reed, 36, of Aspen, Colorado, previously of Vacaville, California, is the seventh defendant sentenced to prison in this case. Jason Schroeder, 36, of Sacramento, was previously sentenced to seven years in prison, Kirk Arthell Sanderson, 37, of Walnut Creek, was previously sentenced to four years in prison; John Judah Young, 34, of Sacramento, was sentence to two and a half years in prison; and David Reed, 29, of Vacaville, was sentenced to one year in prison. Two others, Andrea Lynn Turner, 34, of Roseville, and Joshua Roy Payne, 30, of Vacaville, were each sentenced to two months in prison.
On June 16, 2015, Schroeder pleaded guilty to one count of mail fraud. According to the plea agreement, in October 2012, a sporting goods company with retail stores in Sacramento called the FBI stating that an eBay account was listing items for sale it suspected were stolen. Follow-up investigation revealed that the account was controlled by co-defendant Schroeder using co-defendant Young’s name, and since 2009, it listed more than 17,000 items for sale, including sporting goods, household items, recreational equipment and pet care products. Most of the items were listed as new or with tags. Virtually all of the items sold on the account were stolen by Reed or others, and were sold at a discount to buyers across the country.
According to the plea agreement, Jason Reed and Jason Schroeder took a road trip across the country to Miami to attend the Super Bowl. On that trip, Schroeder and Reed were stealing items on a daily basis, listing the items for sale on eBay in the evenings, and shipping the items out via FedEx.
Wiretaps and surveillance also revealed the specific roles of other members of the conspiracy. According to court documents, David Reed assisted Schroeder with the packaging and shipment of the stolen merchandise. Sanderson assisted in moving items away from Schroeder’s residence when he learned of the federal investigation. Turner and Payne provided false statements to federal agents upon being interviewed regarding their assistance to Schroeder.
This case was the product of an investigation by the Federal Bureau of Investigation, the Internal Revenue Service-Criminal Investigation, and the United States Postal Inspection Service. Assistant United States Attorneys Jared C. Dolan and Jeremey J. Kelley are prosecuting the case.
Federal Jury in Fresno Finds Former Fresno National Guard Recruiter Guilty of Recruiting FraudRead the Press Release
FRESNO, Calif. — On Monday, February 1, 2016, after a seven-day trial, a federal jury found Joaquin Cuenca, 38, of San Diego, guilty of three counts of wire fraud in a scheme to fraudulently obtain bonuses in a recruitment program for the California National Guard, United States Attorney Benjamin B. Wagner announced.
According to evidence produced at trial, Cuenca was a full-time recruiter for the California National Guard in Fresno and defrauded a military recruiting program out of thousands of dollars. The program, the Guard Recruiting Assistance Program (G-RAP), offered a financial incentive to members of the National Guard and others (called Recruiting Assistants, or RAs) who nominated new soldiers. If an RA referred a potential Guard member to a recruiting office and that person ultimately enlisted, the RA was typically eligible to receive $1,000 when a nominee enlisted and $1,000 more when the nominee left for basic training. Because the point of the program was to encourage other soldiers to join in the recruiting effort, G‑RAP incentives were not available for soldiers employed by the Guard as recruiters. Ultimately, G-RAP was discontinued following the discovery of widespread fraud.
According to court documents and evidence presented at trial, Cuenca, was a recruiter and not eligible for bonuses through G-Rap. However, he fed information about new recruits to soldiers who were eligible for G-RAP. Those soldiers (or Cuenca himself) then would enter the information about the new solder online and claim a bonus even though the RA had not in fact referred the new soldier at all. Cuenca would often receive a portion of the bonuses.
“Cuenca joins the ranks of others who have been brought to justice for defrauding G‑RAP and the Army National Guard,” said U.S. Attorney Wagner. “Cuenca and his co-schemers discovered a natural flaw in the program and exploited it. The U.S. Attorney’s Office will continue to uncover and prosecute fraud and abuse of taxpayer money.”
“Joaquin Cuenca's greed and criminal activity permanently tarnished his military career and disrespected the sacrifice of the many men and women who serve our country with honor,” said FBI Special Agent in Charge Monica Miller of the Federal Bureau of Investigation Sacramento field office. “We thank Army Criminal Investigative Command for their continued partnership, ensuring criminals face justice when they allow greed to eclipse their duty to fellow serve members and the American people.”
Chris Hendrickson, Special Agent in Charge of the Western Field Office, Defense Criminal Investigative Service, said: “Corruption strikes at the heart of good government and erodes public trust. The investigation of these offenses is a top priority for the DCIS, its investigative partners, and the U.S. Attorney's Office. Today's verdict demonstrates that there is zero tolerance for this type of shameful misconduct.”
"When individuals fail to live up to the values of the U.S. Armed Forces, they should be held accountable," said Maj. Gen. David S. Baldwin, California's Adjutant General. "We applaud the U.S. Attorney's Office and the law enforcement community in helping us keep the Cal Guard a force of which our communities can be proud."
Cuenca is the second person to be convicted in this district in the last 10 days in connection with fraud with G-RAP. On January 22, 2016, Richard Sihner, 54, of Elk Grove was convicted by a jury in Sacramento of 18 counts of wire fraud and making false statements.
Cuenca is scheduled to be sentenced by United States District Judge Dale A. Drozd on May 16, 2016. Cuenca faces a maximum statutory penalty of 20 years in prison and a $250,000 fine for each count of wire fraud. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
This case is the product of an ongoing investigation by the Army Criminal Investigative Command Major Procurement Fraud Unit, the Defense Criminal Investigative Service, and the Federal Bureau of Investigation. Assistant United States Attorney Michael Tierney and Department of Justice Trial Attorney Alexis Loeb are prosecuting the case.
Other National Guard members and recruiters have been charged in similar recruiting‑fraud schemes in the Eastern District of California. The following defendants have pleaded guilty and await sentencing.
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2:14-cr-153 TLN — Brian Kaps, 42, of Chico, pleaded guilty on November 21, 2014, to one count of wire fraud. Sentencing is set for February 4, 2016.
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2:14-cr-152 TLN — Sarah Nattress, 28, of Paradise, pleaded guilty on October 23, 2014, to one count of wire fraud. A status conference for sentencing is set for February 4, 2016.
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1:14-cr-107 DAD — Leonardo Pesta, 47, of Mountain View, pleaded guilty on July 27, 2015, to one count of wire fraud. Sentencing is set for April 26, 2016.
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1:14-cr-108-LJO — Nicholas Huerta, 33, of Fresno, pleaded guilty on September 14, 2015 to one count of wire fraud. Sentencing is set for November 14, 2016.
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2:14-cr-151 JAM — Richard C. Sihner, 54, of Elk Grove, was found guilty of 18 counts of wire fraud and one count of making false statements. Sentencing is set for May 3, 2016.
Charges are pending against the following (the charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt):
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2:15-cr-005 TLN — Steel A. Davis, 43, of Paradise, was charged with eight counts of wire fraud on January 8, 2015. A status conference is set for February 4, 2016.
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1:14-cr-109 LJO — Jimmy Maldonado, 35, a recruiter, and his wife Mayra Garcia Maldonado, 29, a recruiting assistant, both of Fresno, are allegedly responsible for causing $40,000 in fraudulent bonuses. Trial is scheduled for May 3, 2016.
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Federal Election Fraud Fact SheetRead the Press Release
Most issues concerning the administration and conduct of elections are governed and regulated by state law and are best addressed by state and local election officials. Federal law enforcement and prosecutorial authorities have jurisdiction to investigate and, when appropriate, prosecute election fraud in the following circumstances:
I. Federal Criminal Jurisdiction
Federal criminal jurisdiction over the activities described below can generally be obtained when those activities take place:
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In elections where a federal candidate’s name is on the ballot.
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In any election (federal or nonfederal), when the fraud involves the necessary participation of an election official acting “under color of law.”
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In connection with voter registration. The fact that voter registration is “unitary” in all 50 States (a citizen registers once to become eligible to vote for both federal and nonfederal candidates) confers federal jurisdiction regardless of the type of election.
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In connection with the misuse, or unauthorized trespass, involving a computer system used in connection with an election, to the extent that the misuse or trespass is conducted “under color of law.”
II. Conduct Actionable as Federal Election Fraud, Intimidation, or Suppression
The following activities provide a basis for federal prosecution under the statutes referenced in each category:
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Paying voters to register to vote, or to vote in elections where a federal candidate’s name is on the ballot (52 U.S.C. § 10307, 18 U.S.C. § 597), or through the use of the mails in those States where vote buying is a “bribery” offense (18 U.S.C. § 1952), or in federal elections in those States where purchased votes or registrations are voidable under state law (52 U.S.C. § 20511).
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Multiple voting in a federal election, voting for individuals in a federal election who do not personally participate in the voting act attributed to them, or impersonating voters (52 U.S.C. §§ 10307, 20511).
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Intimidating voters through physical duress in any election (18 U.S.C. § 245(b)(1)(A)); or through physical or economic intimidation in connection with registration to vote or voting in a federal election (52 U.S.C. § 20511, 18 U.S.C. § 594).If the victim is a federal employee, intimidation in connection with all elections is prohibited (18 U.S.C. § 610).
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Malfeasance by election officials, acting “under color of law,” such as diluting valid ballots with invalid ones (so-called “ballot box stuffing”), rendering false vote tabulations, or preventing valid voter registrations or votes from being given effect in any election (18 U.S.C. §§ 241, 242), as well as in elections where federal candidates are on the ballot (52 U.S.C. §§ 10307, 20511).
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Qualifying fictitious individuals to vote in federal elections by placing fictitious names on voter registration rolls (52 U.S.C. §§ 10307, 20511); or through “color of law” in any election (18 U.S.C. §§ 241, 242).
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Preventing or impeding qualified voters from participating in an election where a federal candidate’s name is on the ballot through such tactics as disseminating false information as to the date, timing, or location of federal voting activity (18 U.S.C. §§ 241, 242).
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Registering to vote, or voting in a federal election, by persons who are not entitled to vote under applicable state law, most notably persons who have committed serious crimes, and persons who are not United States citizens (18 U.S.C. §§ 1015(f), 611, and 52 U.S.C. § 20511).
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Falsely claiming United States citizenship in connection with registering to vote or voting in any election (18 U.S.C. §§ 911, 1015(f)).
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Voting in a federal election by anyone who is not a United States citizen in those States where citizenship is a requisite for the franchise (currently all 50 States) (18 U.S.C. § 611).
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Providing false information concerning a voter’s name, address, or period of residence in order to register to vote, or to vote in a federal election (52 U.S.C. §§ 10307, 20511).
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Causing the submission of voter registrations in any election, or of ballots in federal elections, that are materially defective under applicable state law (52 U.S.C. § 20511).
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Ordering, keeping, or having under one’s control any troops or armed men at any polling place in a general or special election, if one is a civil or military officer or employee of the United States government (18 U.S.C. § 592).
To report federal election fraud, intimidation, or suppression contact the United States Attorney’s Office Election Day Hotline at (603) 230-2503. Inquiries and complaints may also be submitted through the United States Attorney’s website at www.usdoj.gov/usao/nh by clicking on the “email us” link.
Complaints about ballot access problems or discrimination can be made directly to the Civil Rights Division’s Voting Section in Washington, D.C. at 1-800-253-3931 or by TTY at 1-877-267-8971.
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Father and Son Indicted for Armed Bank RobberyRead 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 grand jury has returned a four-count indictment charging Brandon Loyd, 19, and his father, Duane Loyd, 44, both of Buffalo, NY, with bank robbery and brandishing a firearm during the bank robbery. The bank robbery charges carry a maximum penalty of 25 years in prison and a $250,000 fine. The firearm charge carries a mandatory penalty of at least seven years prison up to life in prison, consecutive to any prison term imposed for the bank robbery and a $250,000 fine. Duane Loyd was also charged with possessing a firearm after having been convicted of a felony offense, which carries a maximum penalty of 10 years in prison and a $250,000 fine.
Assistant U.S. Attorney Frank T. Pimentel, who is handling the case, stated that according to the indictment, on December 7, 2015 at approximately 11:40 a.m., Brandon Loyd walked into the Key Bank located at 4248 Delaware Avenue in Tonawanda, NY, put a painter’s respirator mask over his face, approached the tellers, and demanded money. As he was demanding money, the defendant displayed a firearm and issued orders causing the customers in the bank to raise their hands in the air. Brandon Loyd subsequently fled the bank with and entered a vehicle driven by his father, Duane Loyd.
A police chase ensued which resulted in the getaway vehicle and a City of Tonawanda Police cruiser colliding. Both Duane Loyd and Brandon Loyd fled the getaway vehicle but were captured shortly thereafter. Police recovered a disassembled pistol with a magazine containing 12 rounds of ammunition.
The two will be arraigned before U.S. Magistrate Judge Hugh B. Scott at a later date.The indictment is the culmination of an investigation by the Federal Bureau of Investigation, under the direction of Special Agent in Charge Adam S. Cohen; the Town of Tonawanda Police Department, under the direction of Jerome C. Uschold, III; the City of Tonawanda Police Department, under the direction of Chief William Strassburg; and the Buffalo Police Department, under the direction of Commissioner Daniel Derenda.
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.
Eight Mississippi Residents Arrested on Distribution of Methamphetamine and Money LaunderingRead the Press Release
OXFORD, Miss. - United States Attorney Felicia C. Adams and Daniel Comeaux, Assistant Special Agent In Charge, Drug Enforcement Administration, Mississippi, announced today that eight individuals were arrested on warrants stemming from an indictment returned by the federal grand jury for the Northern District of Mississippi which charged conspiracy to possess and distribute methamphetamine, possession with intent to distribute methamphetamine and money laundering. A copy of the Indictment is attached.
The following individuals were arrested:
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Jennifer Criddle, Houston, MS
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Deanta Ewing, Vardaman, MS
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Robert Bailey, Ecru, MS
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Trent Montgomery, Ecru, MS
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Paul Marcus Jackson, Cedarbluff, MS
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Contessa Gates, Eupora, MS
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Christopher McKinney, Pheba, MS
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Terry Lynn McKinney, Vardaman, MS
Others previously arrested for similar or related charges include:
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Christopher Graham, Una, MS
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Morickus Davidson, Una, MS
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George Fields, Una, MS
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Akida Williams, Fresno, CA
The case was investigated by agents of the Drug Enforcement Administration and the Mississippi Bureau of Narcotics. Other law enforcement agencies who provided assistance include the U. S. Marshal Service, Sheriff’s Department in Clay, Chickasaw, Calhoun, Webster and Pontotoc Counties, Houston Police Department, Pontotoc Police Department and Calhoun City Police Department.
The public is reminded that an indictment is not evidence of guilt and that each defendant is presumed innocent until proven guilty in a court of law.
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Disbarred Attorney Sentenced to 11 Years in Prison for Scheme to Defraud Clients of More Than $841,000Read the Press Release
Greenbelt, Maryland – U.S. District Judge Paul W. Grimm sentenced former attorney Saundra Lucille White, a/k/a Lucille Parrish-White and six variations of those names, age 57, of Lothian, Maryland, today to 11 years in prison, followed by three years of supervised release, for mail fraud, wire fraud, money laundering, and aggravated identity theft in connection with a scheme to defraud clients of $841,908.57. Judge Grimm also entered an order requiring White to pay restitution of $841,908.57, and to forfeit that same amount, along with property and several vehicles.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Robert Geary of the Treasury Inspector General for Tax Administration; Anne Arundel County Police Chief Tim Altomare; and Interim Chief Henry P. Stawinski of the Prince George’s County Police Department.
According to the evidence presented at White’s seven day trial, in March 2010, White agreed to assist Victim H to obtain guardianship for a relative (Victim M) who had been incapacitated by a stroke. At White’s request Victim H provided White with an accounting of Victim M’s assets. With White’s assistance, Victim H obtained guardianship of Victim M a short time later. Victim M died on January 7, 2011. White was disbarred from the practice of law in the District of Columbia on January 20, 2011 and disbarred in Maryland on September 9, 2011. White did not inform Victim H of her pending disbarment, nor did she tell Victim H that she was no longer a licensed attorney.
According to trial evidence, from March 2010 through May 2013, White created fraudulent tax notices that purported to be from the Internal Revenue Service, and demanded payment of taxes purportedly owed by Victim M and by a deceased relative of Victim M. The notices required that payments be sent to an entity called Intel Realty Financial Services (IRFS) at a mailbox in Annapolis, Maryland, controlled by White. White then mailed and faxed the fraudulent tax notices to Victim H, advising Victim H that in her role as legal guardian of Victim M, she was required to remit payments for these taxes to the address in the notice. Once White obtained the checks sent by Victim H in response to the fraudulent tax notices, totaling $750,000, she deposited them in the bank accounts she opened in the names of IRFS and Victim M. White withdrew the funds from the bank accounts, forging Victim M’s signature on checks made out to White, other entities controlled by White, a family member, or otherwise for White’s benefit. White also obtained debit cards in Victim M’s name and attempted to obtain a Maryland driver’s license in the name of Victim M, but bearing White’s photograph. White used some of the money to purchase luxury items, including a $20,500 check used as a down payment for a 2011 Silver Volvo C70 hard-top convertible.
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 TIGTA, the Anne Arundel County Police Department, and Prince George’s County Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Thomas P. Windom and Special Assistant U.S. Attorney James I. Pearce of the U.S. Department of Justice, who prosecuted the case.
Deputy County Attorney Quick Honored for Role in Veterans CourtRead the Press Release
GREAT FALLS – Deputy Cascade County Attorney Jennifer Quick was honored today for her work on the Cascade County Veterans Court. Quick was presented with a certificate of appreciation from the United States Attorney’s Office for the District of Montana at the February 2nd Veterans Court graduation by Assistant U.S. Attorneys Jeff Starnes and Joe Cik, acting on behalf of Montana U.S. Attorney Mike Cotter.
The Cascade County Veterans Court was established in 2013. In March of 2015, because of a collaborative agreement between Montana’s Eighth Judicial District Court, the Montana Federal District Court, and the U.S. Attorney’s Office, the Veterans Court began accepting qualifying veterans charged with federal crimes. The Veterans Court serves as an alternative to prison for qualifying veterans. Participants are required to engage in intensive multi-stage professional counseling and treatment for substance abuse, mental health, disability, and other issues including but not limited to those related to their military service. They are also required to abide by strict conditions, follow rigorous treatment plans, and attend scheduled hearings before a judge.
Quick served as the founding prosecutor of the Cascade County Veterans Court from 2013 to 2015. “Jennifer is personally and professionally passionate about veterans’ issues,” said Judge Greg Pinski of the Eighth Judicial District, who oversees the Veterans Court. “She went above and beyond by engaging in outreach efforts to expand enrollment and educate other Montana prosecutors on the benefits of the Veterans Court. Without her support and hard work, the Cascade County Veterans Court would not exist.”
“Jennifer Quick and Judge Pinski are to be commended for their instrumental roles as catalysts for the Cascade County Veteran’s Court, and we look forward to a continuing state and federal collaboration,” said Montana U.S. Attorney Mike Cotter. “The U.S. Attorney’s Office is grateful for the opportunity to participate in the forum they have created to give veterans charged with federal crimes an opportunity to obtain structured treatment that will allow them to return to their lives, families, and communities in Montana.”
Quick’s recognition followed a graduation ceremony honoring three new Veterans Court graduates. Since its inception in 2013, twenty-four veterans have participated in the Cascade County Veterans Court. Today’s graduates bring the number of program graduates to eleven. Twelve participants, including one federal probationer, are currently enrolled in the program.
Department of Justice, EPA and the State of Utah Reach Agreement with Salt Lake County to Reduce Polluted Runoff and Protect Water QualityRead the Press Release
The Department of Justice, the U.S. Environmental Protection Agency (EPA) and the State of Utah have reached an agreement with Salt Lake County to resolve alleged Clean Water Act violations associated with the County’s stormwater management program. This agreement, lodged as a consent decree in the U.S. District Court for the District of Utah today, requires the county to take specific measures to reduce illegal stormwater and non-stormwater discharges to Jordan River Valley surface waters by thoroughly implementing the requirements of its municipal separate storm sewer system (MS4) permit. The county will also pay a civil penalty of $280,000.
“This agreement is good news for water quality in Salt Lake County and the people and wildlife that depend on it,” said Assistant Attorney General John C. Cruden for the Department of Justice’s Environment and Natural Resources Division. “The settlement today is the result of a joint enforcement action by the State of Utah and the United States that will protect the area’s precious water resources from contaminated runoff for many years to come.”
“Protecting the water quality in Salt Lake County is a priority for all of us,” said U.S. Attorney John W. Huber for the District of Utah. “Salt Lake County, working together with the State of Utah, the EPA, and the Department of Justice, has agreed to take several measures that will help protect the Jordan River watershed going forward.”
“Preventing and managing polluted runoff in urban areas is essential to protecting water quality,” said Director Suzanne Bohan for EPA’s Enforcement Program in Denver, Colorado. “The rivers and streams in the Jordan River watershed support growing populations and provide significant economic and recreational benefits in Salt Lake County’s communities. EPA will continue to take steps to ensure that municipalities have viable stormwater programs in place to reduce polluted runoff and protect water resources.”
Under the terms of the agreement, Salt Lake County will secure adequate resources to fully maintain and implement its stormwater program, including training and maintaining full-time staff. The county will also take measures to remedy several identified deficiencies, including procedures to review construction site stormwater control plans, inspect sites with active construction or industrial activity and enforce sediment and erosion control requirements. In addition, the county will ensure structural controls are properly installed and maintained and will improve efforts to identify and eliminate illegal discharges to stormwater infrastructure.
The volume of annual runoff in the Jordan River Valley is estimated at 190 million cubic meters per year, a figure that underscores the importance of local efforts to manage stormwater so it does not become contaminated before reaching surface waters. The Jordan River watershed supports fish, migratory bird species and wildlife and provides water for recreation, irrigation and public supply.
Stormwater runoff from rain and snowmelt events can pick up pollutants like trash, chemicals, oils and sediment as it flows over land and impervious surfaces, such as industrial storage areas, paved streets and parking lots. These pollutants can damage the health of a watershed and cause changes in the water quality, resulting in impaired drinking water sources, habitat modification and loss, increased flooding, decreased aquatic biological diversity and increased sedimentation and erosion. Stormwater controls—also known as best management practices—filter out pollutants and prevent pollution by controlling it at its source.
The Clean Water Act uses a permitting process to manage stormwater discharges from three types of sources: municipal separate storm sewer systems (MS4s), construction activities, and industrial activities. These permits are designed to prevent runoff from rain and snowmelt events from washing harmful pollutants into local surface waters. MS4s are systems of conveyances for storm water that include infrastructure such as storm drains, pipes, ditches and roads. MS4 permits are designed to reduce the release of contaminated runoff into MS4s and the waters into which they discharge. EPA and the Utah Department of Environmental Quality inspected the County’s MS4 in 2012 and identified numerous violations of the County’s MS4 permit.
The consent decree agreement requires the county to pay a one-time civil penalty of $280,000, including $140,000 to the United States and $140,000 to the State of Utah, with an opportunity to offset a portion of the state amount through the completion of supplemental environmental projects.
The settlement, lodged today is subject to a 30-day public comment period and approval by the federal court. The settlement will be available for viewing at www.justice.gov/enrd/Consent_Decrees.html
For more information on EPA’s NPDES stormwater program visit: http://www.epa.gov/npdes/npdes-stormwater-program
Department of Justice, EPA and the State of Utah Reach Agreement with Salt Lake County to Reduce Polluted Runoff and Protect Water QualityRead the Press Release
WASHINGTON – The Department of Justice, the U.S. Environmental Protection Agency (EPA) and the State of Utah have reached an agreement with Salt Lake County to resolve alleged Clean Water Act violations associated with the County’s stormwater management program. This agreement, lodged as a consent decree in the U.S. District Court for the District of Utah today, requires the county to take specific measures to reduce illegal stormwater and non-stormwater discharges to Jordan River Valley surface waters by thoroughly implementing the requirements of its municipal separate storm sewer system (MS4) permit. The county will also pay a civil penalty of $280,000.
“This agreement is good news for water quality in Salt Lake County and the people and wildlife that depend on it,” said Assistant Attorney General John C. Cruden for the Department of Justice’s Environment and Natural Resources Division. “The settlement today is the result of a joint enforcement action by the State of Utah and the United States that will protect the area’s precious water resources from contaminated runoff for many years to come.”
“Protecting the water quality in Salt Lake County is a priority for all of us,” said U.S. Attorney John W. Huber for the District of Utah. “Salt Lake County, working together with the State of Utah, the EPA, and the Department of Justice, has agreed to take several measures that will help protect the Jordan River watershed going forward.”
“Preventing and managing polluted runoff in urban areas is essential to protecting water quality,” said Director Suzanne Bohan for EPA’s Enforcement Program in Denver, Colorado. “The rivers and streams in the Jordan River watershed support growing populations and provide significant economic and recreational benefits in Salt Lake County’s communities. EPA will continue to take steps to ensure that municipalities have viable stormwater programs in place to reduce polluted runoff and protect water resources.”
Under the terms of the agreement, Salt Lake County will secure adequate resources to fully maintain and implement its stormwater program, including training and maintaining full-time staff. The county will also take measures to remedy several identified deficiencies, including procedures to review construction site stormwater control plans, inspect sites with active construction or industrial activity and enforce sediment and erosion control requirements. In addition, the county will ensure structural controls are properly installed and maintained and will improve efforts to identify and eliminate illegal discharges to stormwater infrastructure.
The volume of annual runoff in the Jordan River Valley is estimated at 190 million cubic meters per year, a figure that underscores the importance of local efforts to manage stormwater so it does not become contaminated before reaching surface waters. The Jordan River watershed supports fish, migratory bird species and wildlife and provides water for recreation, irrigation and public supply.
Stormwater runoff from rain and snowmelt events can pick up pollutants like trash, chemicals, oils and sediment as it flows over land and impervious surfaces, such as industrial storage areas, paved streets and parking lots. These pollutants can damage the health of a watershed and cause changes in the water quality, resulting in impaired drinking water sources, habitat modification and loss, increased flooding, decreased aquatic biological diversity and increased sedimentation and erosion. Stormwater controls—also known as best management practices—filter out pollutants and prevent pollution by controlling it at its source.
The Clean Water Act uses a permitting process to manage stormwater discharges from three types of sources: municipal separate storm sewer systems (MS4s), construction activities, and industrial activities. These permits are designed to prevent runoff from rain and snowmelt events from washing harmful pollutants into local surface waters. MS4s are systems of conveyances for storm water that include infrastructure such as storm drains, pipes, ditches and roads. MS4 permits are designed to reduce the release of contaminated runoff into MS4s and the waters into which they discharge. EPA and the Utah Department of Environmental Quality inspected the County’s MS4 in 2012 and identified numerous violations of the County’s MS4 permit.
The consent decree agreement requires the county to pay a one-time civil penalty of $280,000, including $140,000 to the United States and $140,000 to the State of Utah, with an opportunity to offset a portion of the state amount through the completion of supplemental environmental projects.
The settlement, lodged today is subject to a 30-day public comment period and approval by the federal court. The settlement will be available for viewing at www.justice.gov/enrd/Consent_Decrees.html
For more information on EPA’s NPDES stormwater program visit: http://www.epa.gov/npdes/npdes-stormwater-program
Davenport Man Sentenced to Prison for Theft of Disability BenefitsRead the Press Release
DAVENPORT, IA – On January 29, 2016, James Clayton Bailey, 67, of Davenport, Iowa, was sentenced by United States District Court Judge Stephanie M. Rose to 15 months in prison for theft of government property, announced Acting United States Attorney Kevin E. VanderSchel. Bailey was ordered to serve three years of supervised release following his prison term and to pay $100 towards the Crime Victims’ Fund. Bailey was also ordered to pay restitution in the amount of $52,441.20 to the Social Security Administration (SSA).
Bailey pleaded guilty to theft of government property on October 26, 2015. According to the plea agreement, Bailey began receiving Social Security Disability benefits in 2003. On October 29, 2009, Bailey was incarcerated in the Iowa Department of Corrections for a sexual abuse conviction. He was released from prison on May 9, 2014. During his incarceration, Bailey failed to notify SSA he was incarcerated and continued to receive his disability payments, knowing he was not qualified to receive such benefits. Bailey received over $52,000.00 in benefits while he was in prison.
This matter was investigated by the Social Security Administration, Office of Inspector General. The case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
Columbus Tax Preparers Plead Guilty to Identity Theft and Income Tax FraudRead the Press Release
United States Attorney G. F. “Pete” Peterman, IIII announced that Michelle Simmons, age 37, of Columbus, and LaRae Townsend, age 36, of Orlando, Florida each pled guilty today, February 2, 2016 to one count of wire fraud, one count of aggravated identity theft and one count of filing false and fictitious claims in front of the Honorable Clay D. Land, Chief U.S. District Judge, in Columbus, Georgia.
According the facts stipulated in the plea agreement, from about January 1, 2011, to March 1, 2014, Ms. Simmons was employed as a tax preparer for a “Gatison & Associates,” located on Miller Road in Columbus, Georgia, and “C&C Bill Pay and Tax Services” in Phenix City, Alabama. Ms. Townsend provided names and social security numbers, obtained from a variety of sources, to Ms. Simmons. Ms. Simmons then submitted approximately 557 fraudulent income tax returns to the Internal Revenue Service (IRS) using an Electronic Filing Identification Number from IRS. Ms. Simmons and Ms. Townsend split the resulting refunds. False claims were filed with the IRS in the total amount of $924,123 in this manner. Due to the fact that some of the returns filed by Ms. Simmons were rejected, the actual loss to the government was $419,139.
Ms. Simmons and Ms. Townsend each face a maximum sentence of thirty (30) years imprisonment, a fine of up to $1,000,000, or both on the wire fraud charges and up to five years and a $250,000 fine as to the false statement charges. Each also faces a mandatory consecutive two year sentence of incarceration on the aggravated identity theft charges. Sentencing will be in approximately sixty (60) days.
“Crimes of this nature produce two separate groups of victims. First are those whose identities are stolen and who are then forced to go through the embarrassment and inconvenience of trying to straighten out all the attendant problems this causes in their lives. The second set of victims are the citizens of the United States, who stood to lose almost $1,000,000 had this scheme not been uncovered through the fine investigative work of the IRS and the Harris County Sheriff’s Department,” said United States Attorney Peterman.
“IRS Criminal Investigation will remain proactive in the investigation of individuals who engage in stealing the identities of innocent people,” said Veronica F. Hyman-Pillot, Special Agent in Charge. “We will continue to utilize every tool available to investigate those who victimize members of our community and innocent taxpayers for their own personal gain.”
The case was investigated by the Internal Revenue Service – Criminal Investigation and the Harris County Sheriff’s Office. Assistant United States Attorney Melvin E. Hyde is prosecuting the case on behalf of the Government.
Questions concerning this case should be directed to Pamela Lightsey, Public Information Officer, United States Attorney’s Office, at (478) 621-2603.
Collin County Woman Guilty in University Embezzlement SchemeRead the Press Release
SHERMAN, Texas – A 42-year-old McKinney, Texas woman has pleaded guilty to federal crimes in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Heather Elizabeth Mercado pleaded guilty to theft today before U.S. Magistrate Judge Christine A. Nowak.
According to information presented in court, from December 2014 to April 13, 2015, Mercado was employed by the University of Texas Southwestern Medical Center in Dallas as Director Talent Acquisition in the Human Resources Department. Mercado also controlled and operated a company, Alliance Consulting Partners (ACP), purportedly in the business of hospital staffing. Mercado devised and executed a scheme in which she represented to UT Southwestern Medical Center that ACP recruited nurses and other personnel to work at UT Southwestern Medical Center thereby causing fraudulent invoices to be generated causing UT Southwestern Medical Center to pay ACP more than $483,000. UT Southwestern officials identified the fraudulent activities and reported it to authorities. Mercado was indicted by a federal grand jury on Jan. 13, 2016.
Mercado faces up to 10 years in federal prison at sentencing. 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. A sentencing date has not been set.
This case is being investigated by the Internal Revenue Service – Criminal Investigation and University of Texas Southwestern and prosecuted by Assistant U.S. Attorney Chris Eason.
Colfax County Man Charged with Assaulting a Federal EmployeeRead the Press Release
ALBUQUERQUE – Cody Martinez, 29, of Raton, N.M., who is charged with assaulting a federal employee, was ordered detained pending trial during a hearing earlier today in federal court in Albuquerque, N.M. The federal charge against Martinez and the order of detention was announced by U.S. Attorney Damon P. Martinez, 8th Judicial District Attorney Donald Gallegos, and Inspector in Charge Keith Fixel of the Phoenix Division of the U.S. Postal Inspection Service.
Cody Martinez was arrested on Jan. 29, 2016, on the federal criminal complaint for allegedly assaulting a U.S. Postal Service (USPS) letter carrier on Jan. 20, 2016. According to the criminal complaint, Martinez allegedly struck the victim in the back of the head with a brick while the victim was delivering mail in Colfax County, N.M., on Jan. 20, 2016. Martinez was apprehended shortly thereafter as he allegedly attempted to flee from law enforcement officers. The victim allegedly sustained serious injuries as a result of the assault.
Martinez was arrested on Jan. 20, 2016 on local charges filed by the 8th Judicial District Attorney’s Office. Those charges were dismissed in favor of federal prosecution.
If convicted on the federal assault charge, Martinez faces a statutory maximum penalty of ten years in federal prison. Charges in criminal complaints are merely accusations and defendants are presumed innocent unless found guilty in a court of law.
This case was investigated by the U.S. Postal Inspection Service and the Raton Police Department, with assistance from the 8th Judicial District Attorney’s Office. Assistant U.S. Attorney Presiliano Torrez is prosecuting the case.
Charlotte County Man Sentenced to 15 Years for Distribution of Child PornographyRead the Press Release
Fort Myers, Florida – U.S. District Judge Sheri Polster Chappell has sentenced Daniel Edward Palmer (38, Port Charlotte) to 15 years in federal prison for distributing child pornography, to be followed by a life term of supervision. The Court also ordered him to forfeit his computer and hard drive, which had been used to commit the offense. Palmer pleaded guilty on September 14, 2015.
According to court documents, between March 31, 2014, and July 8, 2014, an undercover FBI task force agent was able to download several child pornography files from Palmer’s computer using a file sharing program. During the execution of a federal search warrant at Palmer’s residence, agents located Palmer in his bedroom with his computer running. He admitted to the agents that he was the only person in the home who had used the computer. Forensic analyses of the computer revealed hundreds of videos depicting child pornography.
This case was investigated by the FBI Child Exploitation Task Force, which includes the Charlotte County Sheriff’s Office. It was prosecuted by Assistant United States Attorney Yolande G. Viacava.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), 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.
Charleston man pleads guilty in federal court to heroin crimeRead the Press Release
CHARLESTON, W.Va. - A Charleston man pleaded guilty today to a federal heroin crime, announced Acting United States Attorney Carol Casto. Thomas Jarrell, 20, entered his guilty plea in federal court to possession with intent to distribute heroin.
Jarrell admitted that on October 1, 2015, at his Georges Creek residence in Malden, he possessed heroin that he intended to distribute. Agents of the Metropolitan Drug Enforcement Network Team seized the drugs during the execution of a search warrant at Jarrell’s home.
Jarrell faces up to 20 years in federal prison and a $1 million fine when he is sentenced on May 4, 2016.
The investigation of Jarrell was conducted by the Metropolitan Drug Enforcement Network Team and the Kanawha County Sheriff’s Department. Assistant United States Attorney John J. Frail is handling the prosecution. The hearing was held before United States District Judge Thomas E. Johnston.
This case is being prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and heroin. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
Chaka Fattah, Jr., Sentenced to Five Years in Prison for Fraud and Tax ChargesRead the Press Release
PHILADELPHIA – Chaka Fattah, Jr., 33, of Philadelphia, PA, was sentenced today to 60 months in prison for 22 counts that included fraud and tax charges. On November 5, 2015, a federal jury found Fattah, Jr., guilty of bank fraud; making false statements to banks to obtain loans; making false statements to banks and the Small Business Administration to settle loans for less than what was owed; filing false federal income tax returns for tax years 2005, 2006, and 2008; failing to pay federal income tax; wire fraud; and theft from a program receiving federal funds. In addition to the prison term, U.S. District Court Judge Harvey Bartle III ordered restitution in the amount of $1,172,175, five years of supervised release, and a $2,125 special assessment.
Fattah, Jr., obtained numerous business lines of credit through false and fraudulent statements to local banks and used the funds primarily for personal expenses, rather than business expenses as the loan terms required. These false statements involved fictitious earnings information that Fattah, Jr., and an associate supplied for entrepreneurial companies which Fattah and the associate claimed they operated, including 259 Strategies, LLC (“259 Strategies”) and Chaka Fattah, Jr. & Associates.
In 2011, Fattah, Jr., received a loan from United Bank for $50,000 intended for "working capital to support business operations." Instead, he used the funds to make car payments, to pay down more than $40,000 in personal debt, including gambling debts.
Fattah, Jr., defaulted on several lines of credit and provided false information to two banks, to the United States Small Business Administration, which had insured the bank loans, and to a Small Business Administration investigator, to attempt to settle the debts for less than what was owed. Fattah, Jr., falsely claimed that 259 Strategies was out of business at the time he was attempting to settle his debts in 2010, and that he was earning only $2,500 per month. In fact, during 2010, Fattah, Jr.’s 259 Strategies, LLC was intact and he was earning between $6,250 per month and approximately $37,500 per month.
Fattah, Jr. filed false federal income tax returns and failed to pay federal taxes for tax years 2005, 2006, and 2008, and failed to timely pay taxes owed on his 2010 earnings, for a total loss to the IRS of more than $92,000.
Fattah, Jr., also stole funds supplied by the federal government to the Philadelphia School District. Fattah, while the Chief Operating Officer of Delaware Valley High School, a for-profit vendor which provided alternative educational services to the school district, provided false and fictitious expense information and inflated salary figures on budgets submitted to the school district. The school district made payments to Delaware Valley consistent with the budgets, and thus were defrauded of approximately $940,000 during the 2010-2011 and 2011-2012 school years. Some of those funds were paid through a false budget entry which concealed the true recipient of the payments, Fattah.
The case was investigated by the FBI, IRS Criminal Investigations, and the U.S. Department of Education, with the cooperation of the Philadelphia School District’s Office of Inspector General. It is being prosecuted by Assistant U.S. Attorney Paul L. Gray of the Eastern District of Pennsylvania and Trial Attorney Eric Gibson of the Criminal Division’s Public Integrity Section.
Chaka Fattah Jr. Sentenced to 60 Months in Prison for Fraud and Tax ChargesRead the Press Release
Chaka Fattah Jr., 33, of Philadelphia, was sentenced today to 60 months in prison for fraud and tax charges in connection with a scheme to defraud banks, the Internal Revenue Service (IRS) and the Philadelphia School District, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Zane David Memeger of the Eastern District of Pennsylvania.
On Nov. 5, 2015, a federal jury found Fattah Jr. guilty of 22 counts, including bank fraud; making false statements to banks to obtain loans; making false statements to banks and the Small Business Administration (SBA) to settle loans for less than what was owed; filing false federal income tax returns for tax years 2005, 2006 and 2008; failing to pay federal income tax; wire fraud; and theft from a program receiving federal funds. In addition to the prison term, U.S. District Court Judge Harvey Bartle III of the Eastern District of Pennsylvania ordered Fattah Jr. to pay $1,172,157 in restitution.
According to the evidence presented at trial, in 2005, Fattah Jr. and an associate supplied fictitious earnings for companies that they claimed to operate, including 259 Strategies LLC and Chaka Fattah Jr. & Associates, to local banks in order to obtain numerous business lines of credit. Rather than using the lines for credit for business expenses as the loan terms required, however, Fattah Jr. used them primarily for personal expenses. For example, in 2011, Fattah Jr. received a $50,000 loan from United Bank intended for “working capital to support business operations,” which he instead used to make car payments and to pay down more than $40,000 in personal debt, including gambling debts.
The evidence further demonstrated that in 2010, Fattah Jr. had previously defaulted on several lines of credit and, in an attempt to settle the debts for less than what was owed, provided false information to two banks, to the SBA, which had insured the bank loans, and to an SBA investigator. Fattah Jr. falsely claimed that 259 Strategies was out of business, which it was not, and that he was earning only $2,500 per month, when his real income was between $6,250 and approximately $37,500 per month.
Additionally, for tax years 2005, 2006 and 2008, trial evidence showed that Fattah Jr. filed false federal income tax returns, and in 2010, failed to pay on a timely basis federal income tax of approximately $51,141 on more than $150,000 in reported income.
The evidence further demonstrated that in during the 2010 through 2011 and 2011 through 2012 school years, while Fattah Jr. was serving as the chief operating officer of Delaware Valley High School, a for-profit vendor which provided alternative educational services through contracts with the school district, he submitted false expense information and inflated salary figures resulting in approximately $940,000 of fraudulently obtained payments from the school district. Some of the funds were paid through a false budget entry that concealed Fattah Jr. as the true recipient.
The FBI, IRS-Criminal Investigation and the U.S. Department of Education investigated the case with the cooperation of the Philadelphia School District’s Office of Inspector General. Assistant U.S. Attorney Paul L. Gray of the Eastern District of Pennsylvania and Trial Attorney Eric Gibson of the Criminal Division’s Public Integrity Section are prosecuting the case.
California Woman Sentenced to Federal Prison for Heroin and Methamphetamine Trafficking ConvictionRead the Press Release
ALBUQUERQUE – Graciela Meraz, 39, of Chula Vista, Calif., was sentenced this morning in federal court in Albuquerque, N.M., to 60 months in prison for her conviction on heroin and methamphetamine trafficking charges. She will be on supervised release for four years after completing her prison sentence.
Meraz was arrested on Feb. 4, 2015, and was charged in a criminal complaint with possession of heroin and methamphetamine with intent to distribute. According to the complaint, Meraz was arrested by the DEA at the Greyhound Bus Station in Albuquerque after a consensual search of her baggage revealed that she was carrying more than a kilogram of heroin and more than four kilograms of methamphetamine. Meraz was subsequently indicted on those same charges on Feb. 25, 2015.
On July 22, 2015, Meraz pled guilty to a two-count felony information charging her with possession of methamphetamine and heroin with intent to distribute. In entering her guilty plea, Meraz admitted that when she was arrested by the DEA on Feb. 4, 2015, she was transporting approximately 9.24 pounds of methamphetamine and 2.53 pounds of heroin from Los Angeles, Calif. to Oklahoma City, Okla. Meraz acknowledged that she was being paid to transport the drugs.
This case was investigated by the Albuquerque office of the DEA and was prosecuted by Assistant U.S. Attorney Nicholas J. Ganjei.
This case is being prosecuted pursuant to the New Mexico Heroin and Opioid Prevention and Education (HOPE) Initiative. The HOPE Initiative is a collaborative effort between the U.S. Attorney’s Office and the University of New Mexico Health Sciences Center that is partnering with the Bernalillo County Opioid Accountability Initiative with the overriding goal of reducing the number of opioid-related deaths in the District of New Mexico. The HOPE Initiative comprised of five components: (1) prevention and education; (2) treatment; (3) law enforcement; (4) reentry; and (5) strategic planning. The law enforcement component of the HOPE Initiative is led by the Organized Crime Section of the U.S. Attorney’s Office and the DEA in conjunction with their federal, state, local and tribal law enforcement partners. Targeting members of major heroin and opioid trafficking organizations for investigation and prosecution is a priority of the HOPE Initiative.
Brothers Sentenced to 5 Years in Federal Prison for Trafficking HeroinRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that JIMMY ESTEVEZ, 25, of Brooklyn, N.Y., and his brother, MIGUEL ESTEVEZ, also known as “Domi,” 27, of the Bronx, N.Y., were each sentenced today by U.S. District Judge Michael P. Shea in Hartford to 60 months of imprisonment, followed by four years of supervised release, for trafficking heroin.
According to court documents and statements made in court, in March 2013, the DEA New Haven Task Force began investigating a heroin trafficking organization headed by members of the Estevez family who lived in New York and the Dominican Republic. The Estevez organization, including JIMMY and MIGUEL ESTEVEZ, and their cousin, Carlos Gabriel Estevez, supplied wholesale quantities of heroin to customers in New York, New Jersey and Connecticut.
In November 2013, investigators arranged a controlled purchase of approximately 50 grams of heroin from JIMMY and MIGUEL ESTEVEZ. On November 25, 2013, the brothers travelled from New York to a location in Trumbull, Connecticut, to complete the transaction. Thereafter, investigators intercepted numerous calls and text messages that established that JIMMY and MIGUEL ESTEVEZ were obtaining large quantities of heroin from multiple sources of supply, and used multiple vehicles to transport the drug to purchasers in Connecticut
JIMMY and MIGUEL ESTEVEZ have been detained since September 3, 2014. On September 17, 2014, a federal grand jury returned a 13-count indictment charging them, Carlos Gabriel Estevez and five others with heroin trafficking and money laundering offenses. JIMMY and MIGUEL subsequently pleaded guilty to one count of conspiracy to distribute and to possess with intent to distribute 100 grams or more of heroin.
On December 8, 2015, a jury found Carlos Gabriel Estevez guilty of one count of conspiracy to distribute and to possess with intent to distribute one kilogram or more of heroin, and one count of possession with intent to distribute, and distribution of, one kilogram or more of heroin. He awaits sentencing.
Robinson Crucetts, also known as “Robi,” 50, of Hartford, purchased large quantities of heroin from JIMMY, MIGUEL and Carlos Gabriel Estevez. He pleaded guilty and, on January 19, 2016, was sentenced to 66 months of imprisonment.
Four other co-defendants have pleaded guilty and await sentencing.
This matter was investigated by the DEA New Haven Task Force, with the assistance of the DEA Hartford Task Force and the DEA in New York. The DEA New Haven Task Force includes participants from the New Haven, Hamden, West Haven, North Haven, East Haven, Branford, Ansonia, Meriden and Derby Police Departments, and the U.S. Marshals Service. The case is being prosecuted by Assistant U.S. Attorneys Geoffrey M. Stone and Brian P. Leaming.
Another Shenandoah Man Pleads Guilty to Participating in Heroin Trafficking ConspiracyRead the Press Release
SCRANTON—The United States Attorney’s Office for the Middle District of Pennsylvania announced that a 27-year-old Shenandoah resident connected to a large-scale heroin trafficking ring that operated in Schuylkill County during 2012 through September 2015, pleaded guilty yesterday before Senior U.S. District Court Judge James M. Munley in Scranton.
According to United States Attorney Peter Smith, Nicolai Varga pleaded guilty to conspiracy to distribute more than 100 grams of heroin. Varga admitted to distributing heroin and transporting other drug traffickers to New York, Patterson, New Jersey, and Hazleton to obtain large quantities of heroin on multiple occasions. Varga was involved in transporting and distributing between 400 grams and 700 grams of heroin, which is equivalent to between than 13,000 and 23,000 retail bags of heroin.
Varga was indicted by a federal grand jury in Scranton in September 2015, as a result of an investigation by agents of the Federal Bureau of Investigation, investigators from the Pennsylvania State Police, and local police in Schuylkill County.
Judge Munley ordered a presentence investigation to be completed, and scheduled sentencing for April 28, 2016. Varga faces a mandatory minimum sentence of five years in prison and a potential maximum sentence of 40 years in prison.
Three co-defendants—Rhashean Strange, Carlos Correa, and Paul Jadus—have also pleaded guilty to participating in the drug conspiracy. Four other co-defendants are awaiting trial in the case.
Assistant U.S. Attorney Francis P. Sempa is prosecuting the cases.
This case was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the heroin initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law is 40 years in prison, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Albuquerque Man Sentenced for Assaulting Federal OfficersRead the Press Release
ALBUQUERQUE – Charlie Ray Turnbow, 40, of Albuquerque, N.M., was sentenced this morning in federal court to eleven months of imprisonment followed by one year of supervised release for his conviction for assaulting federal officers.
Turnbow was arrested in Aug. 2015, on a criminal complaint charging him with assaulting two officers of the Federal Protective Service of the U.S. Department of Homeland Security on Aug. 6, 2015, in Bernalillo County, N.M. The assault occurred in Albuquerque outside of the offices of the Social Security Administration located at 500 Lead Avenue SW when Turnbow shot at the two officers with an airsoft weapon. The officers were not injured.
On Oct. 7, 2015, Turnbow pled guilty to a misdemeanor information charging him with assaulting federal officers with an airsoft revolver.
This case was investigated by the Federal Protective Service of the U.S. Department of Homeland and the FBI’s Albuquerque Division. Assistant U.S. Attorney Paul Mysliwiec prosecuted the case.
Albany Man Indicted for Synthetic CannabinoidsRead the Press Release
ALBANY, NEW YORK – Shukri Abdullah, age 43, of Albany, New York, was arraigned yesterday on an indictment charging him with possession with the intent to distribute synthetic cannabinoids with brand names like Scooby Snax, Geeked Up, and Green Giant.
The announcement was made by United States Attorney Richard S. Hartunian, Special Agent in Charge James J. Hunt, New York Division, Drug Enforcement Administration, and Albany County Sheriff Craig D. Apple, Sr.
The indictment alleges that on August 20, 2015, Shukri, a co-owner of a deli in Albany, New York, possessed with the intent to distribute synthetic cannabinoids. Synthetic cannabinoids — also known as “Spice” and “K2” — are substances designed to mimic the effects of cannabis, and are often sold as a smokable drug.
The charges in the indictment are merely accusations. The defendant is presumed innocent until proven guilty.
Abdullah faces up to 20 years of imprisonment and a $1,000,000 fine, if convicted. A sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines and other factors. Abdullah, who was indicted on December 23, 2015, was arraigned on February 2, 2016 before United States Magistrate Judge Christian F. Hummel. He was detained pending trial before United States District Judge Gary L. Sharpe.
The case is being investigated by the Drug Enforcement Administration and the Albany County Sherriff’s Office, and is being prosecuted by Assistant United States Attorney Wayne A. Myers.
Acting United States Attorney Announces Crackdown on Bankruptcy FraudRead the Press Release
Earlier today, three individuals were indicted in three separate cases for bankruptcy fraud, Acting United States Attorney for the Southern District of Illinois, James L. Porter, announced. These indictments are part of an effort to crackdown on those who commit fraud during the course of bankruptcy proceedings in the U.S. Bankruptcy Court for the Southern District of Illinois.
"Our federal bankruptcy laws allow people who have overwhelming debt to obtain a fresh start," Acting United States Attorney Porter explained. "Before their debts are eliminated, however, individuals who file bankruptcy are asked to be truthful about their assets and other matters that affect the bankruptcy case. When people conceal their assets and otherwise lie in bankruptcy proceedings, they are cheating their creditors and subverting the bankruptcy process. People who engage in this type of activity can expect to be prosecuted by my office no less than those persons who would use force to steal."
The individuals indicted today are:
SCOTT L. THOMPSON
Scott L. Thompson, 44, of Sesser, IL, was charged with one count of concealing assets and three counts of fraudulently withholding records in a bankruptcy case. The indictment charges that Thompson concealed from the Bankruptcy Court a $28,129.55 settlement he received for a worker’s compensation claim. In addition, it is alleged that Thompson withheld copies of his federal and state tax returns, despite being ordered to turn them over by the Bankruptcy Court. Under federal law, tax refunds in amounts above certain thresholds must be paid to the Bankruptcy Court and used to pay back the bankruptcy’s creditors. Thompson filed his chapter 13 bankruptcy in the United States Bankruptcy Court in Benton, Illinois.
JENNY L. PARKS-SMITH
Jenny L. Parks-Smith, 41, of Carterville, IL, was charged with two counts of concealing assets and one count of fraudulently withholding records in a bankruptcy case. Parks-Smith’s chapter 13 bankruptcy was filed in the U.S. Bankruptcy Court in Benton. The indictment alleges that Parks-Smith concealed from the Bankruptcy Court a $17,000 settlement she received for a worker’s compensation claim. In addition, the indictment charges that Parks-Smith concealed a $2,478 federal tax refund that she received for the 2011 tax year. Parks-Smith is also charged with fraudulently withholding her 2011 tax returns.
MARK A. MCFARLAND
Mark A. McFarland, 58, of Jacksonville, IL, was charged with two counts of making false statements under penalty of perjury, one count of falsifying records, and two counts of making false statements under oath. The bankruptcy case that is the subject of the indictment was filed in the United States Bankruptcy Court for the Southern District of Illinois in East St. Louis, IL. Prior to filing that case, McFarland had filed 10 separate bankruptcy cases in the United States Bankruptcy Court for the Central District of Illinois in Springfield. All but one of those cases had been dismissed due to McFarland’s failure to comply with the Bankruptcy Court’s orders. In the last case, the Bankruptcy Court barred McFarland from filing any more bankruptcy cases in the Central District of Illinois for 180 days. On October 6, 2014, McFarland filed a chapter 13 bankruptcy on behalf of his business, Second Chance of Springfield, Inc., in the U.S. Bankruptcy Court for the Southern District of Illinois. The indictment charges that McFarland: (1) lied on his bankruptcy petition by claiming that his business was located in the Southern District of Illinois; (2) lied on an amended bankruptcy petition when he said that his business had an address in Alton, IL; (3) provided a lease to the Bankruptcy Court that was fraudulently backdated to September 25, 2014; (4) falsely testified under oath that he had signed that lease on September 25, 2014; and (5) falsely testified under oath that he had reached an oral agreement with the landlord for the rental of the Alton property in September 2014.
"I am grateful to Acting U.S. Attorney Porter and the members of the Southern Illinois Bankruptcy Fraud Working Group for their strong commitment to combating bankruptcy fraud," stated Nancy J. Gargula, the U.S. Trustee for Southern Illinois, Central Illinois and Indiana (Region 10). "Today’s charges will go a long way toward protecting the integrity of the bankruptcy system." The charges resulted, in part, from a referral by the U.S. Trustee. Assistance with the investigation was provided by members of the Southern Illinois Bankruptcy Fraud Working Group coordinated by the U.S. Trustee. The U.S. Trustee Program is the component of the Justice Department that protects the integrity of the bankruptcy system by overseeing case administration and litigating to enforce the bankruptcy laws. Region 10 is headquartered in Indianapolis, with additional offices in South Bend, IN and Peoria, IL.
Each count of bankruptcy fraud is punishable by up to 5 years’ imprisonment, and/or a $250,000 fine, not more than three years of supervised release, and restitution.
The investigations are being conducted by agents from the Springfield Division, Fairview Heights Resident Agency, of the Federal Bureau of Investigation ("FBI"). The cases are being prosecuted by Assistant United States Attorney Scott A. Verseman.
An indictment is a formal charge against a defendant. Under the law, that charge is merely an accusation and the defendant is presumed innocent unless proven guilty.
1 February 2016
Worcester Nurse Sentenced for Stealing Oxycodone from PatientsRead the Press Release
BOSTON – A nurse was sentenced on Friday, Jan. 29, 2016, in U.S. District Court in Worcester for stealing pain medication from patients in a nursing care facility in Worcester.
Joanna Dacri, 34, of Auburn, Mass., was sentenced by U.S. District Court Judge Timothy S. Hillman to three years of probation, the first six months of which is to be served in home detention. In Novebmer 2015, Dacri pleaded guilty to one count of acquiring and obtaining Oxycodone by deception.
“Healthcare professionals stealing opioids to feed an addiction pose a compound threat to patients,” said United States Attorney Carmen M. Ortiz. “Not only are they denying patients of necessary pain management, but they are often ‘caring’ for patients while under the influence of narcotics.”
From February to June 2014, Dacri was a nurse at a Worcester nursing care facility. During that period, she stole numerous Oxycodone tablets prescribed to three patients, and surreptitiously substituted other, similar-looking tablets, specifically Loratadine (antihistamine) tablets and Mirtazapine (antidepressant) tablets, in place of the Oxycodone tablets.
This case is being prosecuted as part of the federal response to the growing opioid epidemic in Massachusetts. National health data reveals that two-thirds of heroin addicts start their opioid addition with the unlawful use of prescription painkillers such as oxycodone.
United States Attorney Carmen M. Ortiz; Spencer Morrison, Acting Special Agent in Charge of the Food and Drug Administration, Office of Criminal Investigations, New York Field Office; Michael J. Ferguson, Special Agent in Charge of the Drug Enforcement Administration, New England Field Division; and Commissioner Monica Bharel, M.D., M.P.H, of Massachusetts Department of Health, made the announcement. The case was prosecuted by Assistant U.S. Attorney Young Paik of Ortiz’s Health Care Fraud Unit.
Winthrop Man Pleads Guilty to Drug and Gun ChargesRead the Press Release
Contact: Jody Mullis
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Chad Goucher, 38, of Winthrop, Maine, pleaded guilty today in U.S. District Court to possessing heroin with the intent to distribute, possession of a firearm by a prohibited person, and possession of an unregistered sawed-off shotgun.
According to court records, on March 6, 2015, law enforcement officers executed a search warrant at Goucher’s residence in Winthrop. Officers recovered heroin, drug paraphernalia, and three firearms, including a .12 gauge Iver Johnson sawed-off shotgun. Goucher had a prior felony conviction from the State of Maine which prohibited him from possessing firearms. Goucher admitted to law officers that he intended to distribute some of the heroin and he also admitted that he knew that he was not permitted to possess firearms.
Goucher faces up to 20 years in prison on the heroin charge, a $1,000,000 fine, and between three years and life on supervised release. He faces up to 10 years in prison, up to three years of supervised release, and a fine for each of the firearms charges. He will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
The investigation was conducted by the Winthrop Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Virginia Man Arrested at Jacksonville Airport for Assault on Flight CrewRead the Press Release
Jacksonville, Florida – United States Attorney A. Lee Bentley, III announces the filing of a federal criminal complaint charging Joseph Michael Sharkey (36, Reston, VA) with assault or intimidation of a flight crew. If convicted, he faces a maximum penalty of 20 years in federal prison.
According to the criminal complaint, on Sunday, January 31, 2016, Sharkey was a passenger on Jet Blue Flight 715 from Reagan International Airport in Washington, DC to Jacksonville International Airport (JIA). During the flight, Sharkey verbally assaulted another passenger and then placed that passenger in a headlock. When ordered by a flight attendant to return to his seat, Sharkey at first complied but then assaulted the flight attendant and made an effort exit the airplane through an exit door. Sharkey was stopped by another flight attendant, but then fought with him, kneeing him in the groin. The flight attendants enlisted the help of volunteers and subdued Sharkey, placing him in flex cuffs for the remainder of the flight. The airplane landed safely at JIA and Sharkey was removed from the flight by airport police.
Sharkey made his initial appearance in Jacksonville earlier today. He was temporarily ordered detained until his formal detention hearing, which has been scheduled for February 3, 2016.
A criminal complaint is merely an allegation that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the Jacksonville Aviation Authority Police Department and the Jacksonville Office of the Federal Bureau of Investigation. It will be prosecuted by Assistant U.S. Attorney Dale Campion.
U.S. Customs and Border Protection Officers Arrest Detroit Man Attempting to Smuggle Marijuana to the Virgin IslandsRead the Press Release
St. Thomas, USVI – Deonte Bailey, 24, made his initial appearance on January 31, 2016, before U.S. Magistrate Judge Ruth Miller after being charged in a Complaint with possession with intent to distribute marijuana, United States Attorney Ronald W. Sharpe and U.S. Customs and Border Protection’s (CBP) Virgin Islands Area Port Director Louis Harrigan announced. Bailey was detained pending preliminary and detention hearings set for Tuesday, February 2, 2016.
According to the Complaint, on Saturday, January 30, 2016, at the Cyril E. King Airport’s baggage claim area, a CBP K-9 detected narcotics in a checked bag belonging to Bailey, who had arrived on a Delta Airlines flight from New York. Bailey was taken to secondary inspection where CBP officers discovered a baggage claim ticket for a second bag. The CBP officers went to the Delta Airlines baggage claim area where a second bag belonging to Bailey was recovered. CBP
Field Operations Officers seized a total of 46 pounds (21.1 kilos) of marijuana from Bailey’s bags.“CBP officers remain vigilant to detect and seize illegal contraband being illegally brought into our islands,” stated Port Director Harrigan.
Under federal law if convicted of possession with intent to distribute marijuana, Bailey faces a maximum of five years in prison and a $250,000 fine. This case is being investigated by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). It is being prosecuted by Assistant United States Attorney Nelson L. Jones.
United States Attorney Sharpe reminds the public that a Complaint is merely a formal charging document and is not evidence of guilt. Every defendant is presumed innocent until and unless proven guilty.
U.S. Attorney Dana J. Boente Appointed to Attorney General’s Advisory CommitteeRead the Press Release
Attorney General Loretta E. Lynch announced today the appointment of U.S. Attorney Dana J. Boente of the Eastern District of Virginia to the Attorney General’s Advisory Committee (AGAC), effective Feb. 1, 2016.
“Dana Boente embodies the vision and leadership we need to empower our communities and strengthen our nation, and I am pleased to welcome him to the Attorney General’s Advisory Committee,” said Attorney General Lynch. “Throughout his career – as a Trial Attorney in the Department of Justice’s Tax Division, as a federal prosecutor dedicated to rooting out fraud, and as a U.S. Attorney in Louisiana and Virginia – he has demonstrated his perseverance, his dedication and his wisdom. I have no doubt that he will be an outstanding addition to the Committee, and I look forward to receiving the benefit of his experience as we continue to work towards a safer, more just future for all Americans.”
Boente will fill the seat vacated by former U.S. Attorney Booth Goodwin of the Southern District of West Virginia, who resigned on Dec. 31, 2015.
Boente was appointed by President Barack Obama and confirmed by the Senate on Dec. 15, 2015 as the U.S. Attorney of the Eastern District of Virginia (EDVA). Boente is a 31-year veteran of the Department of Justice, joining the department in 1984 at the conclusion of a clerkship with a U.S. District Court Judge. From 1984 to 1999, Boente was a Trial Attorney with the department’s Tax Division. In January 2000, Boente became an Assistant U.S. Attorney in the Fraud Unit in EDVA. In August 2005, Boente was detailed back to the Tax Division to serve as the Principal Deputy Assistant Attorney General. He returned to EDVA in May 2007, when he was selected as the First Assistant U.S. Attorney. In December 2012, Boente went to serve as the U.S. Attorney of the Eastern District of Louisiana. He returned to the U.S. Attorney’s Office in EDVA in September 2013.
The AGAC was created in 1973 to serve as the voice of the U.S. Attorneys and to advise the Attorney General on policy, management and operational issues impacting the U.S. Attorneys’ Offices.
Two Men Plead Guilty to Federal Charges for Role in Fargo Liquor Store RobberiesRead the Press Release
FARGO - U. S. Attorney Christopher C. Myers announced that on Jan. 29, 2016, Andrew Jerome Ford, and Carlos Henry Bethel, both 28, pled guilty before U. S. District Judge Ralph R. Erickson to Interference with the Commerce by Threats and Violence-Hobbs Act Robbery and Possession of a Firearm in Furtherance of a Crime of Violence.
On September 28, 2015, Bottle Barn Wine and Liquor, 2515 South University Dr., and The Spirit Shop Liquor Store, 1404 33rd St. S., were robbed within an hour of each other. Bethel pled guilty to robbing Bottle Barn while brandishing a firearm and threatening the cashier to hand over money. Ford has agreed to plead guilty to robbing The Spirit Shop through violence or threat of violence and did knowingly possess a firearm in furtherance of the crime of violence.
As part of the plea agreement Ford and Bethel also agreed that they participated or aided and abetted the following crimes:
(a) A home invasion on June 24, 2015, in Hillsboro, North Dakota, where currency was stolen;
(b) A burglary resulting in a stolen firearm in Hillsboro in or about July through September 2015;
(c) A burglary of a vehicle in Fargo, North Dakota, in which monetary instruments were stolen on or about August 24, 2015, and on or about September 24, 2015;
(d) A burglary of a residence in Fargo, resulting in the theft of five firearms on or about September 24, 2015;
(e) Setting fire to four dumpsters in Fargo in an effort to determine law enforcement response time on or about September 28, 2015, as well as robbery of The Spirit Shop Liquor Store in Fargo;
(f) The pistol whipping assault of a victim resulting in serious bodily injury including unconsciousness on or about September 19, 2015 in Fargo; and,
(g) Conspiracy to distribute marijuana in North Dakota.
Judge Erickson has set sentencing for Ford to be held on April 19, 2016, and Bethel’s sentencing is scheduled for April 25, 2016, in the U. S. District Court, Fargo, ND.
This case is being investigated by the Fargo Police Department and Alcohol, Tobacco, Firearms, and Explosives (ATFE).
U. S. Attorney Christopher C. Myers is prosecuting the case
Two Convicted Felons Sentenced to More than 115 Years Each in Federal Prison Following Federal Jury Convictions on Hobbs Act and Firearms OffensesRead the Press Release
DALLAS — Two convicted felons from the Dallas area who were convicted by a federal jury at trial in July 2015 on an array of federal charges stemming from their armed robberies of several fast-food restaurants in the Dallas area in early 2014, were each sentenced today by U.S. District Judge David C. Godbey to more than 115 years in federal prison, announced U.S. Attorney John Parker of the Northern District of Texas.
Jesse Lee Bell, 33, of Duncanville, Texas, and Deundrae Lyndell Miller, 24, of Mesquite, Texas, were each sentenced to serve a total of 1384 months in federal prison and pay more than $8000 in restitution. Each was convicted on four counts of interference with commerce by robbery, one count of attempted interference with commerce by robbery; five counts of using, carrying, and brandishing a firearm during and in relation to a crime of violence, and one count of being a felon in possession of a firearm.
The defendants committed the following armed robberies in North Texas:
June 2, 2014 Whataburger, 501 E. Highway 67, Duncanville
June 4, 2014 Whataburger, 961 W. Beltline Rd., DeSoto
June 7, 2014 Whataburger, 3200 N. Town East Blvd., Mesquite
June 19, 2014 Jack-In-The-Box, 1020 W. Davis, Dallas
June 24, 2014 Whataburger, 2943 N. Galloway Avenue, Mesquite
In addition, the defendants, both convicted felons, each possessed a firearm on June 24, 2014.
The Federal Bureau of Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Duncanville, DeSoto, Mesquite and Dallas Police Departments investigated.
Deputy Criminal Chief Assistant U.S. Attorney Lisa Miller and Assistant U.S. Attorneys Andrew Wirmani and John Kull prosecuted.
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