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29 January 2016
Mission Man Indicted for Domestic Assault by an Habitual Offender and Child AbuseRead the Press Release
United States Attorney Randolph J. Seiler announced that a Mission, South Dakota, man has been indicted by a federal grand jury for four counts of Domestic Assault by an Habitual Offender and three counts of Child Abuse.
Jodie Brave, age 45, was indicted on January 21, 2016. He appeared before U.S. Magistrate Judge Mark Moreno on January 28, 2016, and pled not guilty to the Indictment.
The maximum penalty upon conviction of domestic assault by an habitual offender is up to 5 years in custody and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund for each count. The maximum penalty upon conviction of child abuse is up to 10 years in custody and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund for each count. Restitution may also be ordered.
The charges are merely accusations and Brave is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Rosebud Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Kirk Albertson is prosecuting the case.
Brave was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
Minnesota Man Charged with Possession of a Firearm and Possession with Intent to Distribute MarijuanaRead the Press Release
United States Attorney Randolph J. Seiler announced that an Ellsworth, Minnesota, man has been indicted by a federal grand jury for Possession of a Firearm by a Prohibited Person and Possession with Intent to Distribute a Controlled Substance.
Lugene Rayfeal Russell, age 46, was indicted on January 21, 2016. He appeared before U.S. Magistrate Judge Mark A. Moreno on January 26, 2016, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in custody and/or a $250,000 fine, followed by 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on or about November 16, 2015, at Fort Thompson, Russell knowingly possessed a firearm and was a prohibited person, including having a prior felony. Russell also knowingly and intentionally possessed with intent to distribute marijuana.
The charges are merely an accusation and Russell is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Northern Plains Safe Trails Drug Enforcement Task Force. Assistant U.S. Attorney SaraBeth Donovan is prosecuting the case.
Russell was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
Mexican Drug Trafficker Sentenced to 30 Years in PrisonRead the Press Release
PHILADELPHIA – Francisco Lopez, 37, a Mexican national formerly residing in Tuscon, Arizona, was sentenced today to 360 months in prison for drug trafficking. Lopez was the leader of an international drug trafficking organization which brought thousands of kilograms of marijuana from Mexico and laundered millions of dollars of drug proceeds. On May 14, 2015, a federal jury found Lopez guilty of conspiracy to distribute 1,000 kilograms or more of marijuana, conspiracy to commit money laundering, two counts of money laundering, distribution of 100 kilograms of marijuana, and illegal reentry after deportation.
Lopez had been operating his drug trafficking business since at least January 2010, overseeing the transport of drugs from Mexico in tractor-trailers or through Federal Express Freight to customers in the Philadelphia and New York City areas. At times, the organization was grossing an estimated $4 million a month in drug sales. The cash from these sales was returned to Mexico via cars, tractor trailers, and numerous bank deposits through countless bank accounts, and with the assistance of associates throughout the country.
In addition to the prison term, U.S. District Court Judge Paul S. Diamond ordered a $600 special assessment, five years of supervised release, and a forfeiture money judgment of $1,464,670.
As a result of the investigation, Lopez and 10 of his associates were federally prosecuted. Of those, seven were convicted in the Eastern District of Pennsylvania; two were convicted by the Middle District of North Carolina; and one was convicted in the District of New Jersey.
The case was investigated by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) led Philadelphia/Camden High Intensity Drug Trafficking Area (PC HIDTA) Money Laundering and Drug Asset Forfeiture Task Force. It was prosecuted by Assistant United States Attorney Maria M. Carrillo.
Mesquite Man Sentenced to 20 Years in Federal Prison on Child Pornography ConvictionRead the Press Release
DALLAS — Robert Bruce Lloyd, 76, of Mesquite, Texas, was sentenced this afternoon by U.S. District Judge Sidney A. Fitzwater to 240 months in federal prison, following his guilty plea in July 2015 to one count of receipt of child pornography. U.S. Attorney John Parker of the Northern District of Texas made the announcement today.
Lloyd has been in custody since his arrest in January 2015 on a related federal criminal complaint.
According to documents filed in the case, the FBI learned that a specific IP address, later identified as Lloyd’s, was downloading and sharing files indicative of child pornography. In January 2015, FBI special agents executed a search warrant at Lloyd’s residence and seized his computer and other media. A forensic analysis located more than 1000 images and videos of child pornography on Lloyd’s computer and other media. Lloyd admitted that he received and possessed images that included bondage and sadistic acts involving minors.
According to information presented during today’s sentencing hearing, Lloyd admitted that he had collected child pornography for 30 years. Judge Fitzwater noted that the child pornography was some of the worst he had ever seen, with some depicting sadistic acts done to children as young as three months old.
The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
The FBI investigated. Assistant U.S. Attorney Camille Sparks was in charge of the prosecution.
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McLaughlin Man Sentenced for Assault by Striking, Beating and WoundingRead the Press Release
United States Attorney Randolph J. Seiler announced that a McLaughlin, South Dakota, man convicted of Assault by Striking, Beating and Wounding was sentenced on January 21, 2016, by U.S. Magistrate Judge William D. Gerdes.
Marc Dog Eagle, age 50, was sentenced to 1 year of probation, and a special assessment of $25 to the Federal Crime Victims Fund.
Dog Eagle was indicted by a federal grand jury on November 13, 2014. He pled guilty on November 2, 2015.
The conviction stemmed from an incident on October 23, 2014, when a Bureau of Indian Affairs Officer was dispatched to a residence in McLaughlin, regarding an incident that had occurred between Dog Eagle and his step-daughter, the victim. Dog Eagle and the victim were involved in a disagreement, during which time Dog Eagle struck the victim on her body, against her will.
This case was investigated by the Bureau of Indian Affairs, Standing Rock Agency. Assistant U.S. Attorney Troy R. Morley prosecuted the case.
McLaughlin Man Charged with Domestic Assault by an Habitual OffenderRead the Press Release
United States Attorney Randolph J. Seiler announced that a McLaughlin, South Dakota, man has been indicted by a federal grand jury for Domestic Assault by an Habitual Offender.
Sheldon Crow Ghost, age 31, was indicted on January 21, 2016. He appeared before U.S. Magistrate Judge William D. Gerdes on January 25, 2016, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 5 years in custody and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on or about November 11, 2015, Crow Ghost assaulted his partner. At the time of the domestic assault, Crow Ghost had a final conviction on at least two separate occasions for offenses that would have been, if subject to Federal jurisdiction, an assault against a spouse and intimate partner.
The charge is merely an accusation and Crow Ghost is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Bureau of Indian Affairs, Standing Rock Agency. Assistant U.S. Attorney Troy R. Morley is prosecuting the case.
Crow Ghost was released on bond pending trial. A trial date has not been set.
Massachusetts Woman Pleads Guilty to Distributing Crack CocaineRead the Press Release
Contact: Jody Mullis
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Tawana Smith, a/k/a “Tawana Greene,” a/k/a “T,” 24, of Springfield, Massachusetts, pleaded guilty today in U.S. District Court to distributing cocaine base, commonly known as crack cocaine.
According to court records, on July 8 and July 15, 2015, Smith distributed crack cocaine in the parking lot of two Bangor area hotels. On each occasion, Smith was contacted by an individual cooperating with law enforcement, she arranged the time and location of the transaction, and she sold crack cocaine for $300.
Smith faces up to 20 years, a $1,000,000 fine, and between three years and a life on supervised release on each count. She will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
The investigation was conducted by the Maine Drug Enforcement Agency and the U.S. Drug Enforcement Administration.
Manderson Man Sentenced for Assaulting a Federal OfficerRead the Press Release
United States Attorney Randolph J. Seiler announced that a Manderson, South Dakota, man convicted of Assaulting a Federal Officer was sentenced on January 27, 2016, by U.S. Magistrate Judge Daneta Wollmann.
Frank Boerschig, age 50, was sentenced to 3 months in custody, 1 year of supervised release, and ordered to pay a $25 special assessment to the Federal Crime Victims Fund.
Boerschig was indicted for the charge on September 15, 2015, and pleaded guilty on December 11, 2015.
The conviction stems from Boerschig not complying with the commands of an officer, and then wrestling with and striking the officer in the upper lip on June 24, 2015, at Manderson.
This case was investigated by the Bureau of Indian Affairs, Office of Justice Services, the Oglala Sioux Tribe Department of Public Safety, and the Federal Bureau of Investigation. Assistant U.S. Attorney Eric Kelderman prosecuted the case.
Boerschig was immediately turned over to the custody of the U.S. Marshals Service.
Manderson Man Sentenced for AssaultRead the Press Release
United States Attorney Randolph J. Seiler announced that a Manderson, South Dakota, man convicted of Assault by Striking, Beating, or Wounding was sentenced on January 27, 2016, by U.S. Magistrate Judge Daneta Wollmann.
John Holy Rock, age 21, was sentenced to 18 months of probation and ordered to pay a $25 special assessment to the Federal Crime Victims Fund.
Holy Rock was indicted for Assault with a Dangerous Weapon and Assault Resulting in Serious Bodily Injury by a federal grand jury on April 22, 2014. Holy Rock pleaded guilty to Assault by Striking, Beating, or Wounding on December 4, 2015.
The conviction stems from Holy Rock striking the victim in the head with a 2” x 4” board on January 1, 2013. This assault resulted in injuries to the victim’s cheek and eye socket.
This case was investigated by the Bureau of Indian Affairs, Office of Justice Services, and the Oglala Sioux Tribe Department of Public Safety. Assistant U.S. Attorney Eric Kelderman prosecuted the case.
Manchester Woman Pleads Guilty to Robbing Credit UnionRead the Press Release
CONCORD, N.H.– Emily Gray Rice, United States Attorney for the District of New Hampshire, announced that MELISSA BOUCHER, 27, previously of Manchester, New Hampshire, pleaded guilty today before United States District Judge Landya B. McCafferty to an information charging her with one count of bank robbery in violation of Title 18, United States Code, Section 2113(a).
According to court documents and statements made in court, BOUCHER was pressured to rob a bank by an individual with whom she was engaged in a romantic relationship. After drafting a demand note and providing BOUCHER instructions, that individual led BOUCHER to the Member’s First Credit Union at 44 Bridge Street in Manchester on the morning of March 3, 2015. BOUCHER, who was unarmed at the time, did as she had been instructed, passing the note to the teller, and fleeing the premises with approximately $6,250. The proceeds were then divided between her and the other individual. BOUCHER then utilized a portion of the proceeds to purchase heroin, on which she overdosed. When paramedics were able to resuscitate her, large amounts of cash fell out of her clothing. She was arrested and has remained in custody on a New Hampshire state parole violation since her arrest.
BOUCHER is scheduled to be sentenced by Judge McCafferty on June 6, 2016 at 2:00 p.m., at which time she faces a maximum term of imprisonment of twenty years, up to three years’ supervised release, and a fine of $250,000. She also faces a mandatory restitution order to Member’s First Credit Union.
This matter is being investigated by the Manchester Police Department and the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorney Charles L. Rombeau.
Man Admits Operating India-Based Web Pharmacy that Sold Misbranded Rx Drugs to U.S. ConsumersRead the Press Release
PITTSBURGH - A resident of India pleaded guilty today to charges in a third superseding indictment in Pittsburgh, United States Attorney David J. Hickton announced today.
Zuned Sunesra, 36, of Mumbai, India, pled guilty before the Honorable Cathy Bissoon to charges of conspiracy to commit crimes against the United States, conspiracy to distribute controlled substances, and conspiracy to commit money laundering.
According to information presented to the Court, from November 2005 to August 2014, defendant Zuned Sunesra, and his coconspirators Javed Sunesra, Bismilla Sunesra and Samir Taslimant operated pharmacy websites based out of India called the Emedoutlet.com Network. From these websites, the Sunesras, aided and abetted by others, conspired to distribute unapproved and misbranded prescription drugs into the United States without a prescription. These prescription drugs included “standard” prescription drugs as well as Schedule IV and V controlled substances commonly known as Soma, Darvocet, Meridia, Provigil, and Lyrica which were imported into the United States from India. Many of the sales of these drugs were done without requiring a patient prescription, were done without adequate directions for use and were supplied from unlicensed pharmacies in India.
In addition, the defendant, acting together with others, deceived customers of Emedoutlet.com by claiming that the drugs sold were FDA approved and were similar to drugs sold in the United States when in fact that was not true. The defendant and his conspirators then laundered the money from the illegal sales by funneling the proceeds of these drug sales from the United States eventually being deposited in bank accounts in the Republic of Mauritius and Dubai.
"The FDA-regulated supply chain for medicines helps protect consumers from prescription drugs that could be harmful or unsafe for them to use. When criminals open the access to prescription drugs online without legitimate supervision of physicians, they place the public health at risk and gamble with the health of those who unknowingly order unauthorized medicines online," said Glen A. McElravy, Acting Special Agent in Charge, Metro Washington Field Office, FDA Office of Criminal Investigations. "We will continue to be vigilant in our efforts to bring such criminals to justice."
“From coast to coast and beyond, the IRS will take every step necessary to ferret out those who attempt to use the financial system to circumvent the law while reaping the benefits of their illegal activity”, stated Edward Wirth, Assistant Special Agent in Charge, Philadelphia Field Office of IRS Criminal Investigation. “This joint effort with the FDA-Office of Criminal Investigations continues to demonstrate our efforts to ensure that the financial services industry will not be used for personal financial gain and will be operated in a fair and honest manner to promote the public interest. Our agencies strive to protect the American public from those who attempt to illegally exploit them.”
The law provides for a maximum total sentence of 20 years in prison, a fine of $250,000 or twice the pecuniary gain of the defendants, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Defendant Zuned Sunesra is currently being held without bond.
Assistant United States Attorneys Conor J. Lamb and Jonathan B. Ortiz are prosecuting this case on behalf of the government.
The Food and Drug Administration - Office of Criminal Investigation, through Special Agent Sean Grillo, and the Internal Revenue Service – Criminal Investigation, through Special Agent Neal Bandzak, conducted the joint investigation that led to the conviction in this case.
Major Omaha Gang Members Indicted in Ground-Breaking RICO InvestigationRead the Press Release
United States Attorney for the District of Nebraska Deborah R. Gilg announced the federal Grand Jury for the District of Nebraska has returned a 15 count indictment under the Racketeer Influenced and Corrupt Organizations Act, commonly referred to as the RICO Act, of six individuals of the 40th Ave and 44th Ave Crips. This was a three year long federal and local investigation impacting gun and gang violence coupled with witness intimidation in Northeast Omaha. The individuals indicted, and others, were engaged in criminal activity including, but not limited to drug distribution, witness tampering, and acts of violence involving assault, murder and attempted murder. Indictments are charging documents that contain one or more individual counts that are merely accusations, and every defendant is presumed innocent unless and until proven guilty. This investigation was spearheaded by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the Omaha Police Department. The United States Attorney’s office will be assisted in the prosecution by trial attorneys from the U.S. Department of Justice, Organized Crime and Gang Section of the Criminal Division. All individuals are from Omaha.
Jerell Haynie, a.k.a. “Bootie,” a.k.a. “T”
Male, Age 32Greg Bahati, a.k.a. “Pooh Bear,” a.k.a. “Murk 2x”
Male, Age 21Dionte Dortch, a.k.a. “Killa Tay,”
Male, Age 22Kendell Tealer
Male, Age 28Brandon Heard, a.k.a. “B”
Male, Age 25Julio Arias, a.k.a. “Rudy”
Male, Age 24
Count 1: (Lead charge) RICO Conspiracy, 18 U.S.C. § 1962(d), All Defendants are charged in Count 1.
Penalties for Haynie, Bahati, Dortch, Heard and Arias: 0-20 years, $250,000, TSR 3 yrs., $100 SA
Penalties for Tealer: Death, NLT Life; $250,000, TSR 5 yrs., $100 SACount 2: Attempted Murder in-aid-of Racketeering, 18 U.S.C. § 1959(a)(5), defendant is Haynie.
Penalties: 0-10 yrs., $250,000, TSR 3 yrs., $100 SACount 3: Attempt to Commit Assault with a Dangerous Weapon in-aid-of Racketeering, 18 U.S.C. § 1959(a)(6), defendant is Haynie
Penalties: 0-3 yrs., $250,000, TSR 1 year, $100 SACount 4: Discharge a Firearm During a Crime of Violence, 18 U.S.C. §§ 924(c)(1)(A)(ii) & 924(c)(1)(A)(iii), defendant is Haynie
Penalties: 10 yrs. to Life, $250,000, TSR 5 yrs., $100 SACount 5: Distribution of Cocaine Base, 21 U.S.C. §§ 841(a)(1) & 841(b)(1)(C), defendant is Heard
Penalties: 0-20 yrs., $1,000,000, TSR 3 yrs., $100 SACount 6: Distribution of Cocaine Base, 21 U.S.C. §§ 841(a)(1) & 841(b)(1)(C), defendant is Heard
Penalties: 0-20 yrs., $1,000,000, TSR 3 yrs., $100 SACount 7: Distribution of Cocaine Base, 21 U.S.C. §§ 841(a)(1) & 841(b)(1)(C), defendant is Heard
Penalties: 0-20 yrs., $1,000,000, TSR 3 yrs., $100 SACount 8: Threats in Aid of Racketeering, 18 U.S.C. § 1959(a)(4), defendant is Bahati
Penalties: 0-5 yrs., $250,000, TSR 3 yrs., $100 SACount 9: Brandishing a Firearm During a Crime of Violence, 18 U.S.C. § 924(c)(1)(A)(ii), defendant is Bahati
Penalties: 7 yrs. to Life, $250,000, TSR 5 yrs., $100 SACount 10: Felon in Possession of a Firearm, 18 U.S.C. §§ 922(g)(1) & 924(a)(2), defendant is Dortch
Penalties: 0-10 yrs., $250,000, TSR 3 yrs., $100 SACount 11: Witness Tampering, 18 U.S.C. §§ 1512(b)(1), 1512(b)(2)(A) & 1512(b)(3), defendant is Dortch
Penalties: 0-20 years, $250,000, TSR 3 yrs., $100 SACount 12: Attempted Obstruction of Justice, 18 U.S.C. § 1512(c)(2) defendant is Dortch
Penalties: 0-20 years, $250,000, TSR 3 yrs., $100 SACount 13: Distribution of Cocaine Base, 21 U.S.C. §§ 841(a)(1) & 841(b)(1)(C), defendant is Arias
Penalties: 0-20 yrs., $1,000,000, TSR 3 yrs., $100 SACount 14: Distribution of Cocaine Base, 21 U.S.C. §§ 841(a)(1) & 841(b)(1)(C), defendant is Arias
Penalties: 0-20 yrs., $1,000,000, TSR 3 yrs., $100 SACount 15: Distribution of Cocaine Base, 21 U.S.C. §§ 841(a)(1) & 841(b)(1)(C), defendant is Arias
Penalties: 0-20 yrs., $1,000,000, TSR 3 yrs., $100 SAU.S. Attorney Gilg stated: “These gangs formed a criminal enterprise with the sole objective of drug trafficking and protecting their turf by violence including shootings, murder and attempted murder. The use of the RICO tool in the indictment is a warning to other gangs involved in similar conduct that law enforcement will use every method available to interrupt and terminate the cycle of violence and fear perpetuated by these gangs. The witnesses in these cases are courageous and are to be commended for their willingness to stand up and present evidence to the grand jury.”
Luzerne County Man Sentenced to Five Years in Prison for Distributing Bath SaltsRead the Press Release
SCRANTON—The United States Attorney’s Office for the Middle District of Pennsylvania announced that a 35-year-old Kingston resident was sentenced to five years in prison today by U.S. District Court Judge Malachy E. Mannion in Scranton, for his role in a drug conspiracy that distributed alpha-pvp (commonly known as “bath salts”) in 2012-2013 in the Luzerne County area.
According to United States Attorney Peter Smith, the defendant, Frank Brennan, previously pleaded guilty to conspiracy to distribute alpha-pvp. Brennan admitted to participating in the West Pittston-based drug conspiracy and to distributing a kilogram of alpha-pvp, a controlled substance analogue.
Brennan was indicted by a federal grand jury in Scranton in August 2014, as a result of an investigation by agents of the Department of Homeland Security, the Drug Enforcement Administration, United States Postal Inspectors, the Pennsylvania State Police, and West Pittston Police.
Eleven persons have been charged as participants in the conspiracy which involved wholesale suppliers of alpha-pvp based in Texas, and retail distributors of the drug in Luzerne County. All eleven suspects have entered guilty pleas in the case.
Judge Mannion also ordered Brennan to be placed on three years of supervised release following his prison sentence.
Assistant U.S. Attorney Francis P. Sempa prosecuted the case.
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Long Beach Youth Soccer Coach Indicted on Federal Charges of Possessing and Distributing Child PornographyRead the Press Release
SANTA ANA, California – An Orange County man who coached a Long Beach youth soccer team has been arraigned on a six-count federal indictment that accuses him of possessing and distributing child pornography.
Robert “Bob” Warden Phillips, 65, of Lake Forest, made his initial appearance in federal court Monday and pleaded not guilty to the charges. He was released on a $50,000 bond pending trial, which is slated to begin March 22.
In the fall of 2014, Phillips served as a volunteer for the American Youth Soccer Organization (AYSO), coaching 12- to 14-year-old girls.
The charges against Phillips are the result of a probe by the multiagency Orange County Child Exploitation Task Force, which is overseen by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI).
“Fighting the exploitation of children is one of the top priorities of my office,” said United States Attorney Eileen M. Decker. “In the case of child pornography, victimization takes place when an image is generated and every time it is distributed. We have and will continue to prosecute vigorously individuals who endanger children by creating a market for their victimization.”
The Task Force began investigating Phillips after receiving multiple tips from the National Center for Missing and Exploited Children (NCMEC) about sexually explicit images of minors associated with an email address that traced back to the defendant. In June 2015, Task Force investigators executed a search warrant issued by a state court judge at Phillips’ Lake Forest home, at which time they seized three computers, an iPad, an iPhone, and several media devices. The indictment alleges two of the computers and a thumb drive were found to contain images of child pornography.
According to the affidavit filed in support of the search warrant, HSI obtained records of online instant message chats in which the defendant fantasized about young female soccer players and discussed grooming and molesting girls as young as 14.
“This case is particularly disturbing given the defendant’s former position as a coach and his close contact with children,” said Joseph Macias, special agent in charge for HSI Los Angeles. “HSI will continue to work closely with its partners on the Task Force to investigate those who sexually exploit young people and ensure that those found guilty of such offenses feel the full weight of the law.”
HSI special agents alerted AYSO’s national office about the allegations and AYSO cooperated fully with the investigation. As soon as AYSO learned of the allegations, the defendant was made ineligible for further service pending the outcome of the case.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.
Phillips is charged with three counts of distribution of child pornography and three counts of possession of child pornography. If he was convicted of the six felony offenses, he would face a statutory maximum sentence of 90 years in federal prison. Each count of distribution of child pornography carries a mandatory minimum sentence of five years in federal prison.
At this time, authorities do not have any evidence that Phillips molested any of his players; however, investigators have reason to believe there may be unidentified victims in the case. Task Force investigators are asking anyone who may have information relevant to the investigation to contact HSI’s 24-hour toll free tip line at 1-866-DHS-2ICE (1-866-347-2423) or use the agency’s online tip form. Information may be provided anonymously.
The Orange County Child Exploitation Task Force – which also included investigators from the Orange County Sheriff’s Department, the Federal Bureau of Investigation, the Newport Beach Police Department, and the U.S. Postal Inspection Service – investigates Internet-related crimes against children, as well as crimes involving the possession, production and distribution of child pornography.
Las Vegas Man Pleads Guilty to Corporate-Identity Theft SchemeRead the Press Release
ALEXANDRIA, Va. – Myrick Clift Beasley, 56, of Las Vegas, pleaded guilty today to mail fraud charges in connection with a scheme to obtain goods and services on credit using the stolen identities of legitimate, inactive businesses.
In a statement of facts filed with his plea agreement, Beasley admitted that from 2010 through 2015, he assumed the identity of at least 70 legitimate businesses nationwide, and used those stolen identities to obtain, on credit, at least $550,000 in goods and services from various victims. Beasley admitted that, as part of the scheme, he would identify inactive, legitimate businesses that had previously been located in office buildings where virtual office providers were also located. Beasley admitted that we would assume the inactive businesses’ identities by renting virtual office space in the buildings in the names of the legitimate businesses, creating internet domain names and email addresses in the identified businesses’ names, obtaining phone numbers previously identified with the businesses when available, and, at times, supplementing state corporate filings and commercial credit records with fraudulent information designed to further the scheme. Beasley admitted that he concealed his true identity throughout the fraud by using false names and paying for the costs of operating his scheme with prepaid debit cards. Once he would assume a business’s identity, Beasley admitted that he would then order goods and services — particularly, smart phones, computers, and other electronics — from retailers on credit and have the items shipped to the virtual office location, which would then, at his direction, re-ship the items to rented mailboxes elsewhere in the country. Beasley admitted he would then retrieve the items from the rented mailboxes and sell them.
Beasley was indicted by a federal grand jury on Dec. 17, 2015. Beasley faces a maximum penalty of 20 years in prison when sentenced on April 29, 2016. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office; and Edwin C. Roessler Jr., Chief of the Fairfax County Police Department, made the announcement after the plea was accepted by U.S. District Judge T.S. Ellis, III. Special Assistant U.S. Attorney Christopher R. Fenton and Assistant U.S. Attorney Paul J. Nathanson are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:15-CR-353.
Las Vegas Man Pleads Guilty to Cocaine PossessionRead the Press Release
On January 28, 2016, Jiwon Jiwon Park, a thirty- seven year old, Las Vegas, Nevada, resident pled guilty in federal district court in East St. Louis, Illinois, to count one of Possession with Intent to Distribute Cocaine, the Acting United States Attorney for the Southern District of Illinois, James L. Porter, announced today.
Park is scheduled for sentencing on May 5, 2016, at which time he faces a mandatory minimum sentence of 10 years in prison and a fine of up to $10,000,000, or both, at least 5 years of supervised release after his prison term, and a mandatory special assessment of $100.
Court proceedings revealed that on June 27, 2015, an Illinois State Police officer conducted a traffic stop on Park, after observing him traveling too close to other vehicles on Interstate 70 in Madison County, Illinois. An ensuing search of the vehicle uncovered approximately 7 kilograms of cocaine hidden in vacuum sealed bags in a box in the trunk of Park’s car.
The investigation of this matter is being conducted by the Department of Homeland Security (DHS) and the Illinois State Police (ISP) and is being prosecuted by Assistant United States Attorney Daniel T. Kapsak.
KC Woman Pleads Guilty to $235,000 Arson, Insurance Fraud ConspiracyRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Kansas City, Mo., woman pleaded guilty in federal court today to her role in a $235,000 arson and insurance fraud conspiracy.
Tina L. Shonk, 35, of Kansas City, pleaded guilty before U.S. District Judge Brian C. Wimes to one count of participating in a conspiracy to commit arson and wire fraud, and to one count of mail fraud.
By pleading guilty today, Shonk admitted that she led an arson and insurance fraud conspiracy in 2014. Shonk obtained renter’s insurance on a house she rented in the 3500 block of Garfield, burned the house with the help of co-conspirators, and then made false claims on the insured property resulting in a total loss to insurance companies of $235,464.
Co-defendant Roy Thieman, 31, of Kansas City, pleaded guilty on Sept. 2, 2015, to his role in the conspiracy.
In January 2014 Shonk obtained renter’s insurance in the amount of $60,000, much more than the value of her personal property. At the time, Shonk owed approximately $7,929 in back due rent and the gas had been shut off due to non-payment.
On April 2 and 3, 2014, Shonk, Thieman and other co-conspirators moved any personal property of value to a storage unit. They also moved damaged and broken electronic equipment and appliances into the house so that it would appear that valuable appliances were destroyed. By this time, Shonk owed $10,356 in back due rent and her landlord had begun eviction proceedings.
On April 4, 2014, Shonk, Thieman and other co-conspirators set fire to the house by covering a space heater with a blanket and setting fire to the blanket, and then leaving the house. The Kansas City Fire Department extinguished the fire but the house was a total loss.
After the fire, Shonk made false claims to the insurance company as to the value of her property, that her property was in the house at the time of the fire, and also that she had no knowledge of, or involvement in, the fire. The insurance company paid Shonk $57,364; she paid Thieman $2,500 and another co-conspirator $4,000.
The owner of the house had an insurance policy that paid out a total of $173,100.
In May 2014, Shonk and Thieman moved into a house in the 3800 block of Pittman Road, a property managed by one of her co-conspirators. The co-conspirators discussed repeating the arson insurance fraud scheme at the house on Pittman Road. Thieman wrote a letter to Shonk outlining plans to insure their personal property and then burn the house, stating in part, “there can be no evidence, nor signs of foul play, or accelerant.”
Under federal statutes, Shonk is subject to a sentence of up to 25 years in federal prison without parole. 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 hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Kathleen D. Mahoney. It was investigated by the Kansas City, Mo., Police Department and the U.S. Postal Inspection Service.
Iowa Man Changes His Plea to Guilty in the Robbery of a Fargo InnRead the Press Release
FARGO -U. S. Attorney Christopher C. Myers announced that on Jan. 29, 2016, Eric Lee Webb, 31, Cedar Rapids, Iowa, officially changed his plea to guilty before U. S. District Judge Ralph R. Erickson to a three count Information. The Information charged Webb with 1) Interference with Commerce by Threats and Violence-Hobbs Act Robbery 2) Use and Carrying of a Firearm during and in Relation to a Crime of Violence 3) Possession of a Firearm and Ammunition by a Convicted Felon.
On June 4, 2015, Webb entered the Howard Johnson Inn, 301 3rd Ave. N., Fargo, ND, wielded a firearm at an employee of the Inn demanding money. During the robbery, Webb discharged his firearm in the Howard Johnson Inn. An employee provided Webb with cash. The Fargo Police Department was immediately called and shortly thereafter confronted Webb. He then discharged his firearm at Officers Todd Wahl and Matt Niemeyer while attempting to flee. Webb was prohibited from carrying a firearm or ammunition for having been previously convicted of: 1) Burglary in the Third Degree, a felony, in Iowa District Court; and 2) Robbery in the Second Degree, a felony, in Iowa District Court.
Judge Erickson set sentencing for April 21, 2016.
This case was investigated by the Fargo Police Department and The Bureau of alcohol, Tobacco and Firearms.
First Assistant U. S. Attorney Keith Reisenauer is prosecuting the case.
Imperial Man Sentenced for Possession of Child PornographyRead the Press Release
United States Attorney Deborah R. Gilg announced that Charles Eberhardt, 56, of Imperial, Nebraska, was sentenced on January 29, in Lincoln, Nebraska, to four years, nine months in prison by United States District Judge John M. Gerrard, for possession of child pornography. After his release from prison, Eberhardt will be required to serve a 10 year term of supervised release and be registered as a sex offender.
In September of 2014, Xoom.com, an online international money transfer service, notified Yahoo! that a number of Yahoo! accounts were engaged in the sale of child exploitation material. Investigation determined that several email accounts, operating overseas, were believed to be selling images, video and live-streamed sexual abuse. Eberhardt was found to be one of the persons expressing an interest in young children and appeared to be purchasing images, video, or live streams of child exploitation material from the seller account(s). Evidence showed that at least one wire transfer was sent by Eberhardt to the Philippines. There are also chat logs showing communication with another person in Nebraska about having sex with minors.
On June 2, 2015, a search warrant was issued on Eberhardt’s residence and he admitted to accessing child pornography web sites using the Internet. The forensic investigation of the equipment listed in the Forfeiture Allegation revealed approximately 43 images of child pornography, including visual depictions of prepubescent minors engaged in sexually explicit conduct.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by 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 better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case was investigated by the Federal Bureau of Investigation.
Hutterite Colony to Restore Federally Protected WetlandsRead the Press Release
This week U.S. District Court Judge Karen E. Schreier issued an order requiring the Mayfield Hutterite Colony to restore federally-protected wetlands it drained in 2011. The order was based on a consent judgment entered into by the United States Fish and Wildlife Service and the Mayfield Hutterite Colony.
In November 2011, the U.S. Fish and Wildlife Service discovered that Mayfield Colony had installed drain tile to drain four wetlands in Hamlin County that were protected by a permanent wetland easement owned by the U.S. Fish and Wildlife Service. The Colony had been expressly warned six years earlier not to burn, drain, or fill the wetlands.
The U.S. Fish and Wildlife Service directed the Colony to remove the drain tile. Instead, the Colony offered to exchange the drained wetlands for other property it deemed equivalent. The U.S. Fish and Wildlife Service declined the offer and required restoration of the wetlands, as they provide necessary habitat for area waterfowl.
Despite repeated requests from the U.S. Fish and Wildlife Service to remove the drain tile, it was not removed. The U.S. Fish and Wildlife Service filed suit against the Colony in 2014, seeking the removal of the drain tile from the wetlands and a permanent injunction preventing further drainage of the wetlands.
The Colony entered into a consent judgment agreeing that the Colony, at its own expense, will restore the wetlands to their previous condition, using one of the options in the alternative restoration plan provided by the U.S. Fish and Wildlife Service. The restoration work will be conducted in the spring of 2016, weather permitting. If the Colony fails to comply with the restoration plan, it agrees to pay liquidated damages of $10,000. The Colony also agreed to be permanently enjoined from draining or permitting the draining of the wetlands in the future.
“Yesterday was a good day for conservation. Small, shallow wetlands, such as those protected by this easement, are the most productive breeding habitat in North America for waterfowl and many other birds. Unfortunately, they are also the most vulnerable to drainage and it was important for us to negotiate compliance with the Colony. I am proud of our Madison Wetland District staff and I’m grateful for the strong support of the U.S. Attorney’s Office as we work to keep this important habitat on the landscape,” said Fish & Wildlife Service Regional Easement Coordinator, Dave Azure.
This civil lawsuit was handled by Assistant U.S. Attorney Camela Theeler.
Husband and Wife Sentenced for Fraud Scheme Which Targeted Internet Furniture ShoppersRead the Press Release
Savannah, GA – Max Robert Godfrey, Jr., 52, and his wife Kelly Williams Godfrey, 52, of Raleigh, North Carolina were sentenced this month by United States District Court Judge William T. Moore, Jr. to 24 months and 18 months in prison, respectively, after pleading guilty to a conspiracy to commit mail fraud.
According to evidence presented at the guilty plea and in sentencing proceedings, the Godfreys operated a business advertised as “Furniture Best Buys” on the internet. Customers who hit upon the website were offered discounts if they paid for furniture in advance by check. The Godfreys directed the customers to mail the check to Furniture Best Buys at an address in Pooler, Georgia, which was actually a UPS Store mailbox. Over fifty customers never received their furniture or a refund. Instead, the Godfreys either lied to or ignored customers when they complained, while using customer money for personal expenses. In addition to the prison sentences, the Court ordered the Godfreys to pay $62,240.22 in restitution. Before coming to Georgia, the Godfreys operated businesses in the Raleigh, North Carolina area named NC Home Furniture and Grand Furniture Gallery, which both left numerous customers without their furniture or a refund. In 2012, Max Godfrey was enjoined by a North Carolina court from operating a furniture business that took advance deposits from customers, yet he and his wife continued to do so using the Pooler, Georgia address.
United States Attorney Edward Tarver stated, “The United States Attorney’s Office will not tolerate scam artists who use online businesses to steal from customers. These defendants made the mistake of bringing their fraud scheme into the Southern District of Georgia, and will now bear the consequences in a federal prison.”
The case was investigated by the United States Postal Inspection Service, with assistance from the North Carolina Department of Justice. Assistant United States Attorneys Charles W. Mulaney and Frederick W. Kramer III prosecuted the case on behalf of the United States. Please direct any additional questions to First Assistant United States Attorney James D. Durham at (912) 201-2547.
Hot Springs Man Sentenced for Assault on a Federal EmployeeRead the Press Release
United States Attorney Randolph J. Seiler announced that a Hot Springs, South Dakota, man convicted of Assault on a Federal Employee was sentenced on January 20, 2016, by Chief Judge Jeffrey L. Viken, U.S. District Court.
Paul Vandeinse, age 58, was sentenced to 12 months’ probation and ordered to pay a $25 special assessment to the Federal Crime Victims Fund.
Vandeinse was indicted for the charge on May 19, 2015. Vandeinse pleaded guilty on September 11, 2015.
The conviction stems from Vandeinse making threatening comments to employees at the Veteran’s Affairs Medical Center in Hot Springs in April 2015.
This case was investigated by the Department of Veterans Affairs, Office of Inspector General. Assistant U.S. Attorney Eric Kelderman prosecuted the case.
Greenwich Man Pleads Guilty to Bankruptcy Fraud ChargeRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that ANTHONY GREEN, 39, of Greenwich, waived his right to indictment and pleaded guilty today before U.S. District Judge Michael P. Shea in Hartford to one count of embezzlement against a bankruptcy estate.
According to court documents and statements made in court, GREEN was a managing member of a garbage collection business known as T-Green Carting, LLC. In April 2012, T-Green Carting filed a voluntary chapter 11 bankruptcy petition in the U.S. Bankruptcy Court for the District of Connecticut. While the bankruptcy case was pending, GREEN was required to deposit all of the customer checks for services performed by the T. Green Carting into its debtor-in-possession (DIP) bank account.
Between approximately April 2012 and May 2013, GREEN caused more than $160,000 in cash and cash proceeds that belonged to the T-Green bankruptcy estate to be deposited into his personal bank accounts. He also transferred funds out of and into T-Green’s DIP account, resulting in an additional loss of approximately $18,700 from the bankruptcy estate.
Judge Shea scheduled sentencing for April 29, 2016, at which time GREEN faces a maximum term of imprisonment of five years, a fine of up to $250,000 and an order of restitution.
This matter is being investigated by the Federal Bureau of Investigation and the Greenwich Police Department. The case is being prosecuted by Assistant U.S. Attorney Heather Cherry.
Greensboro Man Sentenced for Tax EvasionRead the Press Release
GREENSBORO, N.C.: United States Attorney Ripley Rand of the Middle District of North Carolina announced today that Douglas Michael Lang, 50, of Greensboro has been sentenced for charges of tax evasion.
Lang was sentenced by Senior United States District Judge James A. Beaty, Jr., to 18 months confinement, a special assessment of $ 100.00, a fine of $5000.00, and 3 years supervised release. Lang must also pay $607,608.00 in restitution.
A Bill of Information was filed on January 15, 2015, charging Lang with failing to file income tax returns, failing to pay income tax, and committing acts of tax evasion. The acts included the payment of personal expenses from Protocol LLC and R & J Vending LLC, two companies that Lang controlled and owned. Lang also retitled his interest in Protocol LLC, of which he was the sole owner, in the name of House of Psalms, an ostensibly religious non-profit entity controlled by Lang. Lang was also charged with opening a bank account in the name Spirit of Angels, another ostensibly religious non-profit entity controlled by Lang. Each of these acts represented conduct Lang undertook to evade the assessment of tax liability.
The case was investigated by the Internal Revenue Service, Criminal Investigation Division. The case was prosecuted by Assistant United States Attorney Robert M. Hamilton.
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Gardiner Man Sentenced to More than 9½ Years for Robbing the Bank of MaineRead the Press Release
Contact: F. Todd Lowell
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that John C. Slater, 68, of Gardiner, Maine was sentenced today in U.S. District Court to 115 months in prison and three years of supervised release for bank robbery. He was also ordered to pay $15,000 in restitution. The defendant pleaded guilty on October 28, 2014.
According to court records, on June 23, 2014, the defendant robbed $15,000 from the Bank of Maine, in Hallowell, Maine after handing a bank employee a demand note that read: “Im Here to Rob your Bank, no silent Alarms my cell Phone rings, your all dead, I have a hand grenade, and a gun, no marked bills, or inked, if so, one day I will come back and kill all of you, do you understand.???”
The ensuing investigation identified the defendant as a suspect. On June 27, 2014, law enforcement officers executed search warrants at two locations where the defendant had been living. Those searches revealed evidence that connected the defendant to the bank robbery. On July 9, 2014, the defendant was arrested in New Hampshire.
The investigation was conducted by the Hallowell, Augusta and Gardiner Police Departments; the Maine State Police; and the Federal Bureau of Investigation.
Founder of Liberty Reserve Pleads Guilty to Laundering More Than $250 Million through His Digital Currency BusinessRead the Press Release
The founder of Liberty Reserve, a virtual currency once used by cybercriminals around the world to launder the proceeds of their illegal activity, pleaded guilty today to running a massive money laundering enterprise, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Preet Bharara of the Southern District of New York.
Arthur Budovsky, 42, pleaded guilty to one count of conspiring to commit money laundering before U.S. District Judge Denise L. Cote of the Southern District of New York. He is scheduled to be sentenced on May 6, 2016.
“After a prior conviction for operating an unlicensed money transmitting business, Budovsky developed Liberty Reserve, which quickly became a premier service used by criminals around the world to launder their criminal proceeds,” said Assistant Attorney General Caldwell. “As a result of this global investigation, however, Budovsky was returned to the United States to face justice once again.”
“Arthur Budovsky founded and operated Liberty Reserve, an underworld cyber-banking system that laundered hundreds of millions of dollars in illicit proceeds for criminals around the world,” said U.S. Attorney Bharara. “The only liberty that Budovsky and Liberty Reserve promoted was the freedom to commit and profit from crime. Thanks to this truly global investigation that included cooperation from 17 countries, Liberty Reserve has been shut down, and its founder Arthur Budovsky stands convicted in an American court of law, facing the loss of his own liberty.”
According to the indictment filed against Liberty Reserve, Budovsky and six co-defendants and Budovsky’s admissions at today’s hearing:
Budovsky specifically designed Liberty Reserve, which billed itself as the Internet’s “largest payment processor and money transfer system,” to help users conduct anonymous and untraceable illegal transactions and launder the proceeds of their crimes. From its inception in or about 2006, Budovsky directed and supervised Liberty Reserve’s operations, finances and business strategy. To grow the business and evade the scrutiny and reach of U.S. law enforcement, Budovsky emigrated to Costa Rica, where he and other defendants began operating Liberty Reserve, and in 2011, Budovsky renounced his U.S. citizenship and became a Costa Rican citizen. Budovsky told U.S. immigration authorities that his company was developing a software that “might open him up to liability in the U.S.”
Liberty Reserve became one of the principal money-transmitting services used by cybercriminals around the world to amass, distribute, store and launder the proceeds of their illegal activity, including proceeds of investment fraud, credit card fraud, identity theft and computer hacking. Before the U.S. government shut down Liberty Reserve in May 2013, it had more than 5 million user accounts worldwide, including more than 600,000 accounts associated with users in the United States, and had processed millions of transactions. Budovsky admitted in his plea agreement to laundering more than $250 million in criminal proceeds.
* * *
Four co-defendants, Vladimir Kats, Azzeddine El Amine, Mark Marmilev and Maxim Chukharev, have already pleaded guilty. Marmilev and Chukharev were sentenced to five years and three years in prison, respectively. Kats and El Amine await sentencing before Judge Cote. Charges remain pending against Liberty Reserve and two individual defendants who are fugitives.
The U.S. Secret Service, the Internal Revenue Service-Criminal Investigation and the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations worked together in this case as part of the Global Illicit Financial Team. The U.S. Secret Service’s New York Electronic Crimes Task Force assisted with the investigation. The Judicial Investigation Organization in Costa Rica, Interpol, the National High Tech Crime Unit in the Netherlands, the Spanish National Police, Financial and Economic Crime Unit, the Cyber Crime Unit at the Swedish National Bureau of Investigation and the Swiss Federal Prosecutor’s Office also provided assistance.
Trial Attorney Kevin Mosley of the Criminal Division’s Asset Forfeiture and Money Laundering Section and Assistant U.S. Attorneys Serrin Turner, Christine Magdo, Christian Everdell and Andrew Goldstein of the Southern District of New York are prosecuting the case. The Criminal Division’s Office of International Affairs and Computer Crime and Intellectual Property Section provided substantial assistance.
Founder of Liberty Reserve Arthur Budovsky Pleads Guilty in Manhattan Federal Court to Laundering Hundreds of Millions of Dollars Through His Global Digital Currency BusinessRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and Leslie R. Caldwell, Assistant Attorney General for the Justice Department’s Criminal Division, announced today that ARTHUR BUDOVSKY pled guilty to running a massive money laundering enterprise in connection with his operation of Liberty Reserve, a virtual currency once used by cybercriminals around the world to launder the proceeds of their illegal activity. BUDOVSKY pled guilty to one count of conspiring to commit money laundering before U.S. District Judge Denise L. Cote.
Manhattan U.S. Attorney Preet Bharara stated: “Arthur Budovsky founded and operated Liberty Reserve, an underworld cyber-banking system that laundered hundreds of millions of dollars in illicit proceeds for criminals around the world. The only liberty that Budovsky and Liberty Reserve promoted was the freedom to commit and profit from crime. Thanks to this truly global investigation that included cooperation from 17 countries, Liberty Reserve has been shut down, and its founder Arthur Budovsky stands convicted in an American court of law, facing the loss of his own liberty.”
Assistant Attorney General Leslie R. Caldwell stated: “After a prior conviction for operating an unlicensed money transmitting business, Budovsky developed Liberty Reserve, which quickly became a premier service used by criminals around the world to launder their criminal proceeds. As a result of this global investigation, however, Budovsky was returned to the United States to face justice once again.”
According to allegations contained in the Indictment filed against Liberty Reserve, BUDOVSKY, and six other individual defendants, and statements made in related court filings and proceedings:
Liberty Reserve billed itself as the Internet’s “largest payment processor and money transfer system.” At all relevant times, BUDOVSKY directed and supervised Liberty Reserve’s operations, finances, and business strategy. Liberty Reserve was specifically designed by Budovsky to help users conduct illegal transactions anonymously and launder the proceeds of their crimes. BUDOVSKY devoted himself to building and expanding Liberty Reserve so that the company could profit from attracting criminal customers, all while seeking to evade the scrutiny and reach of U.S. law enforcement authorities.
Liberty Reserve was born out of BUDOVSKY’s unsuccessful experience running a third-party exchange service, called GoldAge, Inc., for another digital currency, called E-Gold. In or about 2006, BUDOVSKY was convicted in New York State of operating GoldAge as an unlicensed money transmitting business. In 2007, the operators of E-Gold were also charged with criminal offenses, including money laundering and operating an unlicensed money transmitting business, and subsequently ceased doing business. In the wake of his own criminal conviction, BUDOVSKY set about building a digital currency that would succeed in eluding law enforcement where E-Gold had failed, by, among other things, locating the business outside the United States. Accordingly, BUDOVSKY emigrated to Costa Rica, where he and other defendants began operating Liberty Reserve. BUDOVSKY was so committed to evading U.S. law enforcement that he formally renounced his U.S. citizenship in 2011 and became a Costa Rican citizen, telling U.S. immigration authorities that he was concerned that the “software” his “company” was developing “might open him up to liability in the U.S.”
Liberty Reserve subsequently emerged as one of the principal money transmitting services used by cybercriminals around the world to amass, distribute, store, and launder the proceeds of their illegal activity. Liberty Reserve functioned as a financial hub for the online underworld, favored for the ease with which it enabled cybercriminals to conduct anonymous and untraceable financial transactions. Before being shut down by the U.S. government in May 2013, Liberty Reserve had more than five million user accounts worldwide, including more than 600,000 accounts associated with users in the United States, and processed tens of millions of transactions through its system. These funds encompassed proceeds of investment fraud, credit card fraud, identity theft, and computer hacking, among other crimes. As part of his plea agreement, BUDOVSKY admitted to laundering more than $250 million in criminal proceeds through his operation of Liberty Reserve.
* * *
BUDOVSKY, 42, faces a maximum sentence of 20 years in prison for conspiring to commit money laundering. This statutory maximum sentence is prescribed by Congress and is provided here for informational purposes only, as any sentence imposed on the defendant will be determined by the judge.
BUDOVSKY’s sentencing is scheduled for May 6, 2016.
Four co-defendants – Vladimir Kats, Azzeddine El Amine, Mark Marmilev, and Maxim Chukharev – have already pled guilty. Marmilev and Chukharev have both been sentenced, to five and three years in prison, respectively. Kats and el Amine await sentencing before U.S. District Judge Denise L. Cote. Charges against Liberty Reserve and two individual defendants who have not been apprehended remain pending.
Mr. Bharara praised the outstanding work of the United States Secret Service, the Internal Revenue Service-Criminal Investigation, and the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, which worked together in this case as part of the Global Illicit Financial Team. Mr. Bharara also thanked the United States Secret Service’s New York Electronic Crimes Task Force for its extraordinary assistance with the investigation. Additionally, Mr. Bharara specially thanked all the international law enforcement agencies that assisted in the investigation, in particular, the Judicial Investigation Organization in Costa Rica, Interpol, the National High Tech Crime Unit in the Netherlands, the Spanish National Police, Financial and Economic Crime Unit, the Cyber Crime Unit at the Swedish National Bureau of Investigation, and the Swiss Federal Prosecutor’s Office.
This case is being prosecuted jointly with the Department of Justice’s Asset Forfeiture and Money Laundering Section (“AFMLS”), which is overseen by Assistant Attorney General Leslie R. Caldwell. Mr. Bharara thanked AFMLS for its partnership and also thanked the Department of Justice’s Office of International Affairs and Computer Crime and Intellectual Property Section for their support.
The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit and Money Laundering and Asset Forfeiture Unit. Assistant United States Attorneys Serrin Turner, Christine Magdo, Christian Everdell, and Andrew Goldstein of the Southern District of New York and Trial Attorney Kevin Mosley of AFMLS are in charge of the prosecution.
The charges contained in the Indictment against the remaining defendants remain pending and are merely accusations. Those defendants are presumed innocent unless and until proven guilty.
Fort Pierce Resident Ordered to Pay $5,000 Fine for Violation of the Manatee Zone RestrictionsRead the Press Release
A Fort Pierce resident was sentenced today to one year of probation and ordered to pay a $5,000.00 fine by Chief United States Magistrate Judge Frank J. Lynch. Jr., for violating manatee zone speed restrictions.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Jason Riley, Deputy Resident Agent in Charge, U.S. Fish and Wildlife Service (FWS), made the announcement.
Christopher Michael McManus, 37, of Fort Pierce, previously pled guilty to one count of engaging in a waterborne activity contrary to law, in violation of Title 16, United States Code, Section 1583(a)(1)(G). McManus’s court ordered fine will be forwarded to the Lacey Act Reward Account to support wildlife conservation activities.
According to court documents and information disclosed during the court proceedings, on July 3, 2015, McManus was observed at the west shoreline of the Indian River, in the Intracoastal Waterway, in St. Lucie County, operating his boat within the clearly posted slow speed minimum wake manatee protection zone. McManus was operating his boat on plane and creating an excessive wake. McManus had numerous prior convictions for violating fish and wildlife regulations.
Mr. Ferrer commended the investigative efforts of the U.S. Fish and Wildlife Service. This case was prosecuted by Assistant United States Attorney Daniel E. Funk.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Fort Myers Urologist Agrees to Pay More Than $1 MillionRead the Press Release
Fort Myers, FL – United States Attorney A. Lee Bentley, III announces that David Spellberg, M.D., has agreed to pay $1,050,000 to the government to resolve allegations that he violated the False Claims Act by causing claims to be submitted to federal health care programs for laboratory tests that were not medically necessary.
During the relevant time period, Spellberg was a board certified urologist practicing as part of Naples Urology Associates, which was a division of 21st Century Oncology, LLC. 21st Century is a nationwide provider of integrated cancer care services that is headquartered in Fort Myers. As part of its business, 21st Century employs and affiliates with physicians in specialty fields such as radiation oncology, medical oncology, and urology.
The settlement announced today resolves allegations that Spellberg submitted claims to Medicare and Tricare for fluorescence in situ hybridization, or “FISH,” tests that were not medically necessary. FISH tests are laboratory tests performed on urine that can detect genetic abnormalities associated with bladder cancer. Medicare does not consider a FISH test reasonable or necessary unless it’s used to monitor for tumor reoccurrence in a patient previously diagnosed with bladder cancer or unless, after performing a full urologic workup, the physician has reason to suspect that a patient with hematuria (i.e., blood in the urine) may have bladder cancer.
In January 2010, Spellberg became an employee of 21st Century and began referring all of the FISH testing ordered by him to a laboratory owned and operated by 21st Century. He was paid bonuses by the company based, in part, on the number of FISH tests he referred to the 21st Century laboratory.
The allegations that Spellberg was ordering unnecessary FISH tests were originally brought in a lawsuit filed by a whistleblower under the qui tam provisions of the False Claims Act, which allow private parties to bring suit on behalf of the government and to share in any recovery. The whistleblower, a former medical assistant who worked directly for Dr. Spellberg, will receive $199,500 as her share of this recovery. This amount is in addition to a $3.2 million share she will receive as the result of the $19.75 million settlement previously reached with 21st Century Oncology.
“We intend to hold those accountable who intentionally use fraudulent practices to make a profit at others’ expense,” said U.S. Attorney A. Lee Bentley, III. “False claims such as these impact the solvency of our public healthcare programs and erode the confidence of those being serviced by that care.”
"This settlement demonstrates the commitment of the Defense Criminal Investigative Service (DCIS) and its law enforcement partners to protect the integrity of the U.S. military health care program (TRICARE) against fraudulent claims submitted by both corporate and individual medical services providers," said Special Agent in Charge John F. Khin, Southeast Field Office.
The investigation was handled by Trial Attorney Arthur Di Dio from the Civil Division’s Commercial Litigation Branch and Assistant U.S. Attorney Kyle S. Cohen from the Fort Myers Division of the U.S. Attorney’s Office for the Middle District of Florida, with assistance from DCIS, FBI, and the Department of Health and Human Services Office of Inspector General.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $26.7 billion through False Claims Act cases, with more than $16.8 billion of that amount recovered in cases involving fraud against federal health care programs.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
The lawsuit is captioned United States, State of Florida, ex rel. Mariela Barnes v. Dr. David Spellberg, 21st Century Oncology and Naples Urology Associates, Civil Action No. 2:13-cv-228-FtM-38DNF (M.D. Fla.).
Former Owner of Malden Chiropractic Practice Sentenced for Federal Tax FraudRead the Press Release
BOSTON – A former owner of a Malden chiropractic practice was sentenced in U.S. District Court in Boston today to filing fraudulent personal federal tax returns and attempting to obstruct the IRS.
Paul E. Jondle, 61, of Salem, N.H., was sentenced by U.S. District Court Judge Nathaniel M. Gorton to one year and one day in prison, two years of supervised release, and ordered to pay $202,270 in restitution. In October 2015, Jondle pleaded guilty to three counts of tax evasion and one count of obstructing the IRS.
Jondle operated a Malden chiropractic practice called Future Health. Jondle, who was barred from working as a chiropractor, used the names and tax identification numbers of licensed chiropractors working at Future Health for billing purposes, causing the insurance company payors to report the payments to the Internal Revenue Service as income to Jondle’s subcontractors. In fact, the payments, mailed to Jondle and deposited into bank accounts that he controlled, were income to Jondle. From 2003 through 2007, Jondle deposited approximately $3 million into his bank accounts, yet he reported no taxable income for those years, and paid no federal income taxes. During those years, Jondle spent hundreds of thousands of dollars on personal expenses including mortgage payments on his home, landscaping, tuition payments and pet spas.
United States Attorney Carmen M. Ortiz and Kristina O’Connell, Acting Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston, made the announcement today. Assistance was provided by the Massachusetts Insurance Fraud Bureau, U.S. Postal Inspection Service and the U.S. Social Security Administration, Office of the Inspector General. The case is being prosecuted by Assistant U.S. Attorneys Lori J. Holik and Rachel Y. Hemani of Ortiz’s Major Crimes Unit and Trial Attorney Jason M. Scheff of the Department of Justice’s Tax Division.
Former Owner and Operator of California Medical Equipment Supply Company Sentenced for Their Roles in $1.5 Million Medicare Fraud SchemeRead the Press Release
The former owner and the former operator of a durable medical equipment supply company based in Long Beach, California, were sentenced today for their roles in a $1.5 million Medicare fraud scheme.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Eileen M. Decker of the Central District of California, Special Agent in Charge Chris Schrank of the U.S. Department of Health and Human Services Office of the Inspector General (HHS-OIG) Los Angeles Region, Assistant Director in Charge David Bowdich of the FBI’s Los Angeles Division and Special Agent in Charge Joseph Fendrick of the California Department of Justice’s Bureau of Medi-Cal Fraud and Elder Abuse made the announcement.
Amalya Cherniavsky, 41, and her husband, Vladislav Tcherniavsky, 46, both of Long Beach, were ordered to pay $614,418 in restitution. U.S. District Judge Terry J. Hatter Jr. of the Central District of California ordered Tcherniavsky to serve 51 months in prison. On Oct. 15, 2015, a federal jury convicted both defendants of one count of conspiracy to commit health care fraud and five counts of health care fraud.
The evidence at trial demonstrated that Cherniavsky owned JC Medical Supply, a purported durable medical equipment supply company that she co-operated with Tcherniavsky. Evidence further showed that the defendants paid illegal kickbacks to patient recruiters in exchange for patient referrals and paid kickbacks to physicians for fraudulent prescriptions—primarily for expensive, medically unnecessary power wheelchairs—which the defendants then used to support fraudulent bills to Medicare.
Between 2006 and 2013, the defendants submitted $1,520,727 in claims to Medicare and received $783,756 in reimbursement for those claims, according to evidence presented at trial.
The case was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office of the Central District of California. HHS-OIG’s Los Angeles Regional Office, the FBI and the California Department of Justice’s Bureau of Medi-Cal Fraud and Elder Abuse investigated the case. Attorneys Blanca Quintero and Kevin R. Gingras of the Criminal Division’s Fraud Section prosecuted the case.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 2,300 defendants who have collectively billed the Medicare program for more than $7 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.
Former Owner of Internet Sports Memorabilia Businesses Charged with $2.5 Million Fraud SchemeRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that a former owner of a group of internet sports memorabilia businesses has been charged in connection with a $2.5 million dollar fraud scheme.
According to United States Attorney Peter Smith, Joshua Aaron Shores, age 41, of Bel Air, Maryland and also of Ocean City, Maryland, is charged with Wire Fraud in a Criminal Information filed today in the United States District Court in Scranton.
The charge is based upon Shores’ alleged five-year scheme, between 2008 and 2013, to obtain money and property by dealing in counterfeit and fraudulent sports memorabilia. Shores allegedly created, owned, and operated internet businesses under the names of Dealakhan, LLC, Stadium Authentics, Autograph Showcase, Sunset Beach, End Game Sports, Authenticgraph, and others with facilities in York County, Pennsylvania and in Maryland, and used the businesses to traffic in counterfeit and fraudulent sports memorabilia.
Shores allegedly represented addresses of mailbox receiving services to customers as his business address, created and registered PayPal and Amazon.com accounts in his name and in the names of others to receive payments from customers, purchased counterfeit sports jerseys in bulk from China and affixed fraudulent autographs to them representing them to be authentic autographs of well-known athletes and sports figures, and also using fake certificates of authenticity. According to the Criminal Information, Shores unlawfully obtained approximately $2.5 million dollars from buyers of the fraudulent items.
The Criminal Information also seeks forfeiture of real property located in Ocean City, Maryland, U.S. currency in the approximate amount of $140,000, and an additional amount of $26,000 in proceeds related to a Harley-Davidson motorcycle and a sports utility vehicle. The government will also seek restitution for victims of the fraud scheme.
The Criminal Information was filed pursuant to a plea agreement entered into between the United States and Shores. The agreement, which is subject to the approval by the court, includes joint recommendations relating to loss amounts, forfeiture allegations, and an agreement to pay restitution as determined by the court.
The investigation was conducted by the Federal Bureau of Investigation and Homeland Security Investigations. The case is being prosecuted by Assistant United States Attorney Michelle Olshefski.
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 charge of Wire Fraud is punishable by up to 20 years of imprisonment, a term of supervised release following imprisonment, and a $250,000 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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Former Madbury, New Hampshire Resident Sentenced to 33 Months in Jail for Mail FraudRead the Press Release
CONCORD, N.H. – Nicholas Selby, age 31, of Snellville, Georgia and a former resident of Madbury, New Hampshire, was sentenced today to 33 months in prison after pleading guilty to a mail fraud scheme that involved the theft of $1,065,100 from his former employer, Planet Fitness Holdings, LLC, announced United States Attorney Emily Gray Rice.
Selby was employed as a systems manager for the company. As a systems manager, Selby did not have authority to make purchases on behalf of the company. Nevertheless, from November 2013 to March 2015, Selby purchased 2,190 iPads from four technology vendors with whom Planet Fitness maintained credit accounts. He also caused Planet Fitness to pay for the iPads by submitting fraudulent invoices to the company’s accounts payable department. As the iPads were delivered to the company’s corporate office in Newington, New Hampshire, Selby removed the iPads from the building and sold them for his personal benefit.
Selby’s scheme was uncovered when another Planet Fitness employee contacted a vendor about an iPad the employee had ordered. During a conversation with the vendor, the employee was made aware of significant iPad orders placed by Selby. A company investigation resulted in a call to the Newington Police Department and the FBI.
The case was investigated by the Newington Police Department and the Federal Bureau of Investigation. It was prosecuted by AUSA Robert Kinsella.
Former Kentucky Private Investigator and Legal Consultant Sentenced to Prison for Tax FraudRead the Press Release
Failed to File Tax Returns for Four Years and Lied to the IRS about His Financial Condition
A former Russell Springs, Kentucky investigator and legal consultant, was sentenced to three years in prison and three years of supervised release, following his June 2015 conviction for tax fraud, Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney Kerry B. Harvey for the Eastern District of Kentucky announced today.
James S. Faller II, 54, was convicted after a two-week jury trial of one count of corruptly endeavoring to obstruct the Internal Revenue Service (IRS), four counts of evading federal individual income taxes, one count of falsifying a document submitted to the IRS under penalties of perjury and four counts of failing to timely file his federal individual income tax returns. In addition to his prison sentence, the court ordered restitution to be determined at a later date.
According to the evidence admitted at trial, from 2006 through 2009, Faller received annual income of approximately $126,000 to $289,000 per year from his work as a private investigator and legal consultant. However, Faller did not timely file any individual income tax returns for that period. Instead, Faller took steps to conceal his income from the IRS in several ways, including arranging for his income to be made payable to a nominee and using nominee bank accounts. Faller owes additional federal income taxes of $112,065 for the 2006 through 2009 tax years.
“When individuals submit false information in an effort to obstruct the IRS and evade the payment of tax due and in doing so, steal from the American public, the Tax Division stands ready to prosecute,” said Acting Assistant Attorney General Ciraolo. “Today’s sentence sends a message that this conduct will not be tolerated, and those lying to the IRS and hiding their income to avoid paying their tax liabilities will pay a heavy price.”
In March 2010, Faller signed and submitted a false Form 433-A, Collection Information Statement for Wage Earners and Self-Employed Individuals, to an IRS revenue officer as part of the IRS’s efforts to collect his unpaid taxes. A Form 433-A is used by the IRS to obtain financial information from a taxpayer to determine his ability to pay an outstanding tax liability. On this form, which the taxpayer signs under penalties of perjury, the taxpayer must disclose information about his income and expenses. On the Form 433-A that Faller submitted to the IRS revenue officer, Faller falsely reported that he had no income even though he had earned $23,000 in the preceding month alone.
Acting Assistant Attorney General Ciraolo and U.S. Attorney Harvey thanked special agents of the IRS Criminal Investigation, who investigated the case, and Trial Attorney Thomas Voracek of the Tax Division and Assistant U.S Attorney Thomas Lee Gentry of the Eastern District of Kentucky, who prosecuted the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Former Husband and Wife Plead Guilty to Bankruptcy FraudRead the Press Release
POCATELLO - Benjamin Gunn, 46, of Rock Springs, Wyoming, and Melody Gunn, 45, of Idaho Falls, Idaho, pleaded guilty yesterday to bankruptcy fraud, U.S. Attorney Wendy J. Olson announced. The Gunns were charged by information on January 28, 2016.
According to the plea agreements, the Gunns filed for bankruptcy in May 2011, and
falsely represented in the filed petitions, schedules, and statement of financial affairs the value and transfer of a 1968 Camaro. The Gunns’ electronic signatures verified the truthfulness of the filed documents under penalty of perjury. Within the documents, however, the Gunns represented the value of the Camaro as $5,000 and falsely claimed that they held another asset, a 2008 Artic Cat Prowler Utility Task Vehicle (UTV), as “property held for another person.” In truth, the Gunns had received the UTV, purchased in 2008, for $9,499, in addition to $2,500 cash and construction services, in exchange for the Camaro. The Camaro later sold at auction for $13,190. The Gunns admitted in court that they provided the false information with the intent to mislead and conceal assets from the chapter 7 trustee, in order to influence or prevent the trustee from seizing and selling the UTV in the course of the bankruptcy proceedings.
The charge of bankruptcy fraud is punishable by up to five years in prison, a maximum fine of $250,000, and up to three years of supervised release.
Sentencing is set for April 12, 2016, before Chief U.S. District Judge B. Lynn Winmill at the federal courthouse in Pocatello.
The case was investigated by Internal Revenue Service, Criminal Investigations (IRS-CI).
Today's announcement is part of efforts underway by President Obama's Financial Fraud Enforcement Task Force (FFETF), which was created in November 2009 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. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants.
Former Doral Public Service Aide and Two Tow Truck Drivers Arrested for Participating in Bribery SchemeRead the Press Release
A former Doral Police Department Public Service Aide and two tow truck drivers were arrested for participating in a bribery scheme.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Donald W. De Lucca, Chief, Doral Police Department (DPD), made the announcement.
Former DPD Pubic Service Aide (PSA) Leonardo Mayi, 36, and two tow truck operators Andreo Cambria, 51, and Roberto Dominguez, 31, were arrested pursuant to a federal criminal complaint charging each defendant with conspiracy and corruption charges related to their participation in a pirate towing scheme.
According to the allegations contained in court filings, Cambria offered to pay PSA Mayi cash in return for Mayi misusing his official position to corruptly steer business to Cambria and Dominguez. During the course of the corruption scheme, Mayi would permit Cambria and Dominguez to circumvent Doral’s rotational wrecker system and approach stranded drivers at accident scenes to illegally solicit their business. When Cambria or Dominguez was successful, they would tow the disabled vehicles to garages which would, in turn, pay cash kickbacks to Cambria and Dominguez. For his part, Mayi was paid approximately $100 per successfully towed vehicle. As a result of their participation in the scheme, between February 2013 and February 2014, the conspirators generated thousands of dollars of illicit business and Mayi himself received at least $5,000 in bribes.
PSA Mayi submitted his resignation with the Doral Police Department. Before resigning, Mayi had been with the department since 2008.
Each of the defendants are charged with conspiracy to commit an offense against the United States, that is, engaging in a wire fraud scheme resulting in the deprivation of Mayi’s honest services and accepting bribes in connection with Mayi’s duties with the DPD, an agency that receives federal funding, all in violation of Title 18, United States Code, Section 371. Each defendant is exposed to a maximum sentence of five years’ imprisonment, to be followed by three years supervised release, and up to a $250,000 fine.
Mr. Ferrer commended the investigative efforts of the FBI Miami Area Public Corruption Task Force and the Doral Police Department. This case is being prosecuted by Assistant United States Attorney Anthony W. Lacosta.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Former Director Pleads Guilty to Stealing from Domestic Violence ShelterRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that the former director of a domestic violence shelter in Lebanon, Mo., has pleaded guilty in federal court to embezzling more than $30,800 from the shelter.
Mary Young, 64, of Estes Park, Colo., waived her right to a grand jury and pleaded guilty before U.S. Magistrate Judge David P. Rush on Thursday, Jan. 28, 2016, to a federal information that charges her with credit card fraud.
Young was hired on Aug. 1, 2008, as the executive director of Creating Opportunities for Personal Empowerment (COPE), a domestic violence shelter located in Lebanon. Young resigned on June 10, 2014, and the fraud was detected following her resignation.
Young was given two credit cards, both issued to COPE, to facilitate the purchasing of goods and services needed to operate the shelter and to serve their clients. Young admitted that she fraudulently used both credit cards to make unauthorized personal purchases (i.e., gas for a vehicle, restaurant bills, clothing, travel, liquor and groceries). Young’s fraudulent purchases began on Sept. 16, 2008, shortly after being hired, and ended on May 19, 2014, shortly before she resigned.
Young admitted that she spent more than $25,000 for numerous personal purchases using one of the credit cards, and more than $5,800 using the second credit card.
Under federal statutes, Young is subject to a sentence of up to 10 years in federal prison without parole. 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 hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Patrick Carney. It was investigated by the FBI.
Former Cushing Resident Pleads Guilty to Making False Statements to the FAA and is Sentenced to Serve Five Years Probation and 180 Days Home ConfinementRead the Press Release
Oklahoma City, Oklahoma – At a combined change of plea and sentencing hearing Thursday, LARRY DALE MORGAN, 70, of Fort Worth, Texas, and formerly of Cushing, Oklahoma, pleaded guilty to knowingly making false statements to the Federal Aviation Administration ("FAA") and was sentenced to serve five years probation and 180 days of home confinement, announced Mark A. Yancey, Acting United States Attorney for the Western District of Oklahoma. In addition, Morgan was ordered to forfeit $42,000 to the United States and pay $43,000 in restitution to the victim of the offense.
As background, the FAA requires "traceability" of all aircraft and aircraft parts, requiring that any inspections, repairs, overhaul, maintenance, or changes in the physical condition of aircraft or aircraft parts be detailed in logbooks that accompany an aircraft throughout its use. The FAA and the aviation industry rely upon the accuracy of these records to determine the airworthiness, maintenance history, and value of an aircraft. In order to ensure aircraft safety, the FAA also requires that anyone wishing to perform a major aircraft or component modification receive FAA approval.
According to the Superseding Indictment filed on January 6, 2015, Morgan, formerly a pilot in Cushing, Oklahoma, responded to an advertisement in Fall of 2010 and traded his Beechcraft Bonanza aircraft for a Cessna aircraft owned by a person in upstate New York. As part of that transaction, it was alleged that Morgan made a series of false entries into the Beechcraft’s log books, submitted a fraudulent bill of sale falsely representing that he was the aircraft’s sole owner, and inflated the aircraft’s value. Following discovery of problems with the Beechcraft, making it inoperable, and falsified entries in its logbook entries, the FAA grounded the plane due to safety concerns. Morgan was charged with five counts of wire fraud, two counts of false statements involving aircraft parts, and making false statements to the FAA.
At the plea hearing, Morgan pleaded guilty to Count 8 and specifically admitted that he falsified an Aircraft Bill of Sale in which he listed himself as the sole owner of the Beechcraft Bonanza, well knowing that the aircraft was in fact co-owned by the Bank of Cushing.
This case is the result of an investigation by the United States Department of Transportation, Office of the Inspector General. It was prosecuted by Assistant U.S. Attorney Julia E. Barry.
Former Credit Union Employee Sentenced to 30 Months in Federal Prison and Ordered to Pay Nearly $800,000 in Restitution for Embezzling Funds from Pantex Federal Credit UnionRead the Press Release
AMARILLO, Texas — Dorothy Stegall Barnes, a/k/a “Dorothy Stegall Newman,” of Fritch, Texas, was sentenced this morning by U.S. District Judge Mary Lou Robinson to 30 months in federal prison following her guilty plea in September 2015 to one count of embezzlement from a federally insured credit union, announced U.S. Attorney John Parker of the Northern District of Texas.
Judge Robinson also ordered that Barnes, 57, pay $797,336 in restitution. She must surrender to the Bureau of Prisons by February 15, 2016.
According to documents filed in the case, Barnes, who worked as the Assistant Vice-President of Teller Operations of the Pantex Federal Credit Union (PFCU) in Borger, Texas, admitted embezzling approximately $826,000 from the credit union.
In October 2014, Barnes advised the credit union’s President that a teller had suddenly quit. At the President’s request, she counted the teller’s vault and advised him that the vault was short $380,000. The vault was recounted, and the shortage was determined not to be a clerical error. An audit was conducted, and during the auditing process, the auditor identified a transaction traced to Barnes in which she transferred $826,000 to her teller vault. Barnes admitted taking the $826,000 over a number of years, but denied any involvement in the missing $380,000. She admitted embezzling money from PFCU in different ways and said she avoided detection by making various transactions to make her teller vault balance. PFCU officials located copies of the PFCU checks Barnes issued to pay her bills and other expenses between approximately 1996 and November 2010.
The FBI and Borger Police Department investigated. Assistant U.S. Attorney Joshua Frausto prosecuted.
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Former Barksdale airman sentenced to 8 years in prison for receiving child pornographyRead the Press Release
SHREVEPORT, La. – United States Attorney Stephanie A. Finley announced today that a New Jersey man who was stationed at Barksdale Air Force Base was sentenced to 96 months in prison for receiving child pornography on his personal computer.
Kyle Daniel Reese, 21, of Sicklerville, N.J., was sentenced on one count of receiving child pornography by U.S. District Judge S. Maurice Hicks Jr. Reese was also sentenced to five years of supervised release and must register as a sex offender. According to evidence presented at the August 10, 2015 guilty plea, law enforcement agents detected a computer at Barksdale Air Force Base downloading child pornography. Agents obtained warrants and searched Reese’s domicile and work site on February 4, 2015. A forensic examination of the digital media found more than 600 images and more than five videos of child pornography on his personal computer. Before his sentencing, Reese was discharged from the Air Force.
This case was investigated by the U.S. Department of Homeland Security/Homeland Security Investigations, the Louisiana State Attorney General Jeff Landry’s Office Cyber Crime Unit, the Northwest Louisiana Internet Crimes Against Children Task Force, the Bossier City Marshal’s Office and the U.S. Air Force Office of Special Investigations. Assistant U.S. Attorney Robert W. Gillespie Jr. prosecuted the case.
This case is part of Project Safe Childhood, a U.S. Department of Justice nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, visit www.projectsafechildhood.gov.
The U.S. Attorney’s Office and the U.S. Department of Homeland Security/Homeland Security Investigations/Immigration & Customs Enforcement (ICE) encourage the public to report suspected child predators and any suspicious activity through its toll-free hotline at (866) DHS-2ICE. Investigators are available at all hours to answer hotline calls. Tips or other information can also be submitted to ICE online at www.ice.gov/exec/forms/hsi-tips/tips.asp. Tips may be submitted anonymously.
Fifty-Six Ms-13 Members IndictedRead the Press Release
BOSTON – Fifty-six alleged leaders, members, and associates of the criminal organization “La Mara Salvatrucha,” or “MS-13,” have been indicted on federal racketeering conspiracy charges, including charges related to murder, conspiracy to commit murder, attempted murder, and drug trafficking. Various defendants are also charged with drug trafficking, firearm violations, immigration offenses, and fraudulent document charges.
This morning, over 400 federal, state and local law enforcement officers carried out the arrests of the numerous MS-13 leaders, members, and associates in the Boston area, including in the cities of Chelsea, East Boston, Everett, Lynn, Revere and Somerville. Fifteen of the indicted defendants were already in custody on federal, state or immigration charges.
According to court documents, in 2012, MS-13 became the first, and remains the only, street gang to be designated by the United States government as a “transnational criminal organization.” Today, MS-13 is one of the largest criminal organizations in the United States, and is an international criminal organization with over 6,000 members in the United States, with a presence in at least forty-six states and the District of Columbia, as well as over 30,000 members internationally, mostly in El Salvador, Mexico, Honduras, and Guatemala. In Massachusetts, MS-13 is largely composed of immigrants and descendants of immigrants from El Salvador and has members operating throughout the Commonwealth, with higher concentrations in Chelsea, East Boston, Everett, Lynn, Revere, and Somerville.
Violence is a central tenet of MS-13, as evidenced by its core motto -- “mata, viola, controla,” translated as, “kill, rape, control.” During the course of this investigation, this violence was directed against rival gangs, particularly the 18th Street gang, and anyone who was perceived to have disrespected MS-13. The 18th Street gang, another criminal organization in Central America with members living in the United States, has been a longstanding rival of MS-13. MS-13 members and associates often commit murders and attempted murders using machetes, knives, and chains in order to intimidate rival gang members.
During the course of this investigation, it is alleged that MS-13 actively recruited prospective members, known as “paros,” inside local high schools from communities with significant immigrant populations from Central America, including Chelsea High School, East Boston High School and Everett High School. Prospective members were typically 14 or 15 years old. Under the strict rules of MS-13, as communicated to the local “cliques” by the leaders of MS-13 in El Salvador, these prospective members must engage in significant violent criminal activity on behalf of the criminal organization, usually the killing of a rival gang member, in order to become a full-fledged member of MS-13, known as a “homeboy.” The indictment alleges that several of the defendants are responsible for the murders of at least five people since 2014, in Chelsea and East Boston, as well as the attempted murder of at least 14 people.
The indictment further alleges that members of the MS-13 organization in Massachusetts sell cocaine, heroin, and marijuana, and commit robberies, in order to generate income to pay monthly dues to the incarcerated leadership of MS-13 in El Salvador. This money is allegedly used to pay for weapons, cell phones, shoes, food, and other supplies for MS-13 members in and out of jail in El Salvador.
The RICO conspiracy charge provides a maximum sentence of 20 years, or life if the violation is based on racketeering activity for which the maximum penalty includes life imprisonment; three years of supervised release; and a fine of $250,000. Depending on the drug quantity, the drug trafficking conspiracy and distribution charges provide a maximum sentence of 20 years, 40 years, or life; a minimum of three, four or five years of supervised release; and fines of $1 million, $5 million and $10 million. The charge of possession of a firearm in furtherance of a drug trafficking crime provides a maximum sentence of five or seven years on and after any other sentence depending on how the firearm was used. The charge of being an alien in possession of a firearm and ammunition provides a maximum sentence of 10 years, three years of supervised release, and a fine of $250,000. The charge of illegal re-entry of a deported alien provides a maximum sentence of 10 years, three years of supervised release, and a $250,000 fine. The transfer of false identification document charge provides a maximum sentence of 15 years, three years of supervised release, and a fine of $250,000. The purchase of a fraudulent social security card charge provides a maximum sentence of five years, three years of supervised release, and a fine of $250,000.
United States Attorney Carmen M. Ortiz; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Matthew Etre, Special Agent in Charge of Homeland Security Investigations in Boston; Colonel Richard D. McKeon, Superintendent of the Massachusetts State Police made the announcement today.
The U.S. Attorney’s Office would also like to acknowledge the FBI’s North Shore Gang Task Force and the assistance and cooperation of Daniel F. Conley, Suffolk County District Attorney; Marian T. Ryan, Middlesex County District Attorney; Jonathan Blodgett, Essex County District Attorney; Boston Police Commissioner William Evans; Chief Brian A. Kyes of the Chelsea Police Department; Chief Steven A. Mazzie of the Everett Police Department; Chief Kevin Coppinger of the Lynn Police Department; Chief Joseph Cafarelli of the Revere Police Department; Chief James Fitzpatrick of the Lawrence Police Department; Chief David Fallon of the Somerville Police Department; Commissioner Carol Higgins O’Brien of the Massachusetts Department of Corrections; Sheriff Frank G. Cousins, Jr. of the Essex County Sheriff’s Department; and Sheriff Steven W. Tompkins of the Suffolk County Sheriff’s Department.
The details contained in the indictments are allegations. The defendants are presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
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Addendum A
The following defendants are charged with one count of racketeering influenced corrupt organization (RICO) conspiracy:
1. Oscar Noe Recinos-Garcia, a/k/a “Psycho,” 22, of Somerville
2. Juilo Esau Avalos-Alvarado, a/k/a “Violento,” 23, of Chelsea
3. German Hernandez-Escobar, a/k/a “Terible,” 28, of Medford
4. Noe Salvador Perez-Vasquez, a/k/a “Crazy,” 25, of Somerville
5. Santos Portillo-Andrade, a/k/a “Flaco,” 31, of Everett
6. Herzzon Sandoval, a/k/a “Casper,” 34, of Cambridge
7. Edwin Guzman, a/k/a “Playa,” 30, of East Boston
8. Jose Hernandez-Miguel, a/k/a “Muerto,” 27, of East Boston
9. Edgar Pleitez, a/k/a “Cadejo,” 26, of East Boston
10. Christian Alvarado, a/k/a “Catracho,” 26, of Everett
11. Cesar Martinez, a/k/a “Cheche,” 35, of East Boston
13. Fnu Lnu, a/k/a “Caballo,” of Everett
14. Erick Argueta Larios, a/k/a “Lobo,” 31, of Cambridge
15. Luis Solis-Vasquez, a/k/a “Brujo,” 25, of Everett
16. Jose Miguel-Hernandez, a/k/a “Smiley,” a/k/a ”Danger,” 20, of Somerville (Deported)
17. Carlos Melara, a/k/a “Chuchito,” a/k/a “Criminal,”19, of East Boston
18. Joel Martinez, a/k/a “Animal,” 20, of East Boston
19. Jose Rene Andrade, a/k/a “Triste, a/k/a “Innocente,” 24, of Somerville
20. Hector Enamorado, a/k/a “Vida Loca,” 37, of Chelsea
21. Henry Santos-Gomez, a/k/a “Renegado,” a/k/a ”Pino,” 30, of Revere
22. Rafael Leoner-Aguirre, a/k/a “Tremendo,” 20, of Chelsea
23. Hector Ramires, a/k/a “Cuervo,” 22, of Chelsea
24. Daniel Menjivar, a/k/a “Rocoa,” a/k/a ”Sitiko,” 19, of Chelsea
25. Angel Pineda, a/k/a “Bravo,” a/k/a “Jose Lopez,” 20, of Chelsea
26. Jose Vasquez, a/k/a “Little Crazy,” 22, of Somerville
27. David Lopez, a/k/a “Cilindro,” a/k/a ”Villano,” of New Jersey
28. Bryan Galicia-Barillas, a/k/a “Chucky,” 18, of Chelsea
29. Domingo Tizol, a/k/a “Chapin,” 21, of Chelsea
30. Fnu Lnu, a/k/a “Violento,” of Arizona
31. Oscar Duran, a/k/a “Demente,” 24, of East Boston
32. Edwin Gonzalez, a/k/a “Sangriento,” 20, of East Boston
33. Henry Josue Parada Martinez, a/k/a “Street Danger,” 20, of East Boston
34. Josue Morales, a/k/a “Gallito,” 20, of Chelsea
35. Kevin Ayala, a/k/a “Blancito,” 22, of Chelsea
36. Mario Aguilar Ramos, 19, of Somerville
37. Rutilio Portillo, a/k/a “Pantera,” 32, of Everett
38. Edwin Diaz, a/k/a “Demente,” 18, of East Boston
39. Marvin Melgar, a/k/a “Ninja” 21, of Chelsea
40. Jairo Perez, a/k/a “Seco”, 24, of Chelsea
56. Jose Adan Martinez Castro, a/k/a “Chucky”, 26, of Richmond, VA
Addendum B
The following defendants are charged with drug trafficking conspiracy:
41. Ramiro Guerra, a/k/a “Camello,” 42, of East Boston
42. Manuel Martinez, a/k/a “Gordo,” 44, East Boston or Stoneham
43. Alex Alvarenga, 42, of Saugus
44. Manuel Flores, a/k/a “Manny”, 41, of East Boston
45. Heiner Yovani Gomez, a/k/a “Fiero,” 31, of Chelsea
46. FNU LNU, a/k/a “The Columbian”
47. Carlos Lovato, 32, of Chelsea
48. FNU LNU, a/k/a “Migue”
49. Luis Lnu
Addendum C
The following defendants have been charged with immigration violations and/or fraudulent document charges;
50. Jose Nelsin Reyes-Velasquez, a/k/a “Diablito”, 22, of Malden
51. Oscar Rivera, a/k/a “Jose”, 27, of Chelsea
52. Roberto A. Lopez, of Chelsea
53. Franklin Rodriguez, a/k/a “Hollywood”, 35, of Chelsea
54. Oscar Ramirez-Cornejo, a/k/a “Vago”,
55. Mauricio Sanchez, a/k/a “Tigre”
57. Elenilson Gustavo Gonzalez-Gonzalez, a/k/a “Siniestro”
Federal Jury Convicts Baton Rouge Businessman in Fraudulent U.S. Treasury Check SchemeRead the Press Release
BATON ROUGE, LA –United States Attorney Walt Green announced that a third defendant has been convicted in connection with Operation Checkmate, a federal criminal investigation into various check cashing businesses in Baton Rouge that cashed nearly $4 million in fraudulently-obtained U.S. Treasury checks.
This morning a federal jury convicted CARLOS L. LINARES, age 56, of Baton Rouge, Louisiana, for his role in defrauding the government out of more than $1.6 million following a week-long trial before Chief U.S. District Judge Brian A. Jackson. Specifically, LINARES was convicted on all counts of a superseding indictment which charged him with theft of government funds, in violation of Title 18, United States Code, Section 641, failure to maintain an effective anti-money laundering program, in violation of Title 31, United States Code, Sections 5318 and 5322, and two counts of obstruction of a federal proceeding, in violation of Title 18, United States Code, Section 1505. LINARIES was remanded into custody following his conviction. His sentencing is scheduled for 9:30 a.m. on May 19, 2016.
During the relevant period, LINARES operated a store on Florida Boulevard in Baton Rouge called “Latinos Supermarket, LLC” where he cashed checks for a fee. In just a fifteen-month time period spanning March of 2012 through May of 2013, LINARES cashed more than 250 U.S. Treasury checks with out-of-state addresses worth over $1.6 million. The checks had been obtained through fraud and misused other people’s identities, which LINARES knew. LINARES also knowingly failed to follow the requirements placed on him as a registered money service business and failed to prevent his store from being used to facilitate criminal activity and launder money. Finally, LINARES attempted to obstruct efforts by the Internal Service Revenue to determine whether LINARES was following the law.
U.S. Attorney Green stated: “Extensive fraud schemes often require a network of people willing to facilitate the fraud for their personal gain. My office will continue to aggressively pursue all those who facilitate such fraud schemes, including check cashers who knowingly cash fraudulent checks, ignore anti-money laundering requirements, and obstruct law enforcement efforts. I am proud of the dedicated efforts of the prosecutors and IRS-CI in connection with this important matter.”
Special Agent in Charge Jerome R. McDuffie of IRS Criminal Investigation stated: “We are pleased with the verdict returned today against Mr. Linares. We will continue to work closely with the U.S. Attorney’s Office to prosecute those involved in these types of fraudulent schemes. Mr. Linares intentionally participated in a scheme that involved the negotiation of fraudulently obtained tax refund checks and failed to comply with federal reporting requirements. Today’s verdict is a reminder that fraud involving identity theft, and the prosecution of all involved parties, remains one of our agencies’ top priorities."
Other defendants who have been convicted in Operation Checkmate include:
ALBELK REYES SERRATA, age 26, of Allentown, Pennsylvania, was convicted of conspiring to steal government funds, in violation of Title 18, United States Code, Section 371. He was sentenced to 37 months in federal prison, followed by three years of supervised release. He was also ordered to pay $2.2 million in restitution and to forfeit another $220,000.
ANYELINA REYES, age 36, of Baton Rouge, Louisiana, was convicted of conspiring to steal government funds, in violation of Title 18, United States Code, Section 371. She operated a store on Florida Boulevard called “A&R Elite Team, LLC” and facilitated the cashing of approximately 370 fraudulently-obtained U.S. Treasury checks worth $2.2 million. She was recently ordered to serve 6 months in federal prison, followed by a two year-term of supervised release. She has been ordered to pay $2.2 million in restitution and to forfeit the proceeds of her scheme.
This ongoing investigation is being handled by the Internal Revenue Service—Criminal Investigation Division, with assistance from the Louisiana Office of Financial Institutions. The matter is being prosecuted by Assistant United States Attorney Alan A. Stevens, who serves as a Deputy Chief of the Criminal Division, and Assistant U.S. Attorney Ryan Crosswell.
Federal Court Preliminarily Orders Florida Man to Close Tax Preparation Business and Bars Him from Preparing Federal Tax Returns for OthersRead the Press Release
Court Orders Nation Tax Services to Shut Down Immediately Based on a “Pattern of False Tax Returns”
A federal court in Orlando, Florida has preliminarily barred Jason Stinson from preparing federal tax returns for others and from operating a tax return preparation business, the Justice Department announced today. The civil order, signed by Judge Anne C. Conway of the U.S. District Court for the Middle District of Florida, requires Stinson to “immediately close all tax return preparation stores that he currently owns.”
According to the court’s order, Stinson owns a company that operates return preparer storefronts under the name “Nation Tax Services.” According to the United States’ complaint, Stinson’s stores are in Alabama, Florida, Georgia and North Carolina.
The United States filed its civil injunction complaint against Stinson in September 2014. The complaint alleged that return preparers in Stinson’s businesses targeted primarily low-income customers with deceptive and misleading advertisements, prepared and filed fraudulent tax returns to fraudulently increase their customers’ refunds and profited through unconscionable, exorbitant and often undisclosed fees—all at the expense of their customers and the United States Treasury.
Trial in this case is scheduled for October. To prevent the alleged fraud from continuing this tax filing season, the United States filed a motion for preliminary injunction to bar Stinson from operating his stores pending resolution of this case after trial. Following a hearing on the motion, the court today found that the United States “presented enough evidence to show a pattern of false tax returns sufficient to prove it is likely to succeed on the merits” at trial. The pattern of false returns alleged by the United States includes:
- Falsely claiming the Earned Income Tax Credit;
- Fabricating businesses and related business income and expenses;
- Fabricating Schedule A deductions for unreimbursed employee expenses, charitable deductions and medical and dental expenses; and
- Claiming false education credits.
The court found that the “falsely reported numbers are not merely oversight, or a computational error, because the errors are repeated and the amounts are significant.” The court added that it was “most troubled that Stinson’s conduct has continued even after the commencement of this lawsuit in 2014.”
The court also held that the “Government and Stinson’s customers will suffer irreparable harm if an injunction is not granted.” The court emphasized “the harm that Stinson’s business causes his customers”:
Stinson’s customers are relying on his business to properly handle their taxes. In return, Stinson’s business exposes these primarily low-income customers to individual tax liability. Both the Government and Stinson’s customers will suffer irreparable harm if an injunction is not granted. Moreover, it is in the public’s best interest to protect vulnerable customers from the inaccurate preparation of their taxes, not to deplete Government resources, and to maintain the public trust in the tax system.
Return preparer fraud is one of the Internal Revenue Service’s (IRS) Dirty Dozen Tax Scams. The IRS has some tips on their website for choosing a tax preparer and has launched a free directory of federal tax preparers. In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Egyptian Citizen Charged with Visa FraudRead the Press Release
PHILADELPHIA - Mahmoud Ramadan Moussa Ayoub Moussa, 25, of Alexandria, Egypt, was charged today by Information with possessing a U.S. visa procured by fraud, announced United States Attorney Zane David Memeger.
If convicted, the defendant faces a maximum possible sentence of 10 years in prison and a $250,000 fine.
The case was investigated by the FBI’s Joint Terrorism Task Force, including law enforcement officers and agents from Homeland Security Investigations, Pennsylvania State Police, and the Philadelphia Police Department. It is being prosecuted by Assistant United States Attorney Jennifer Arbittier Williams.
An Information is an accusation. A defendant is presumed innocent unless and until proven guilty.
Eagle Butte Man Charged with Possession of a FirearmRead the Press Release
United States Attorney Randolph J. Seiler announced that an Eagle Butte, South Dakota, man has been indicted by a federal grand jury for Possession of a Firearm by a Prohibited Person.
Nelson Red Bird, age 26, was indicted on January 21, 2016. He appeared before United States Magistrate Mark A. Moreno on January 28, 2016, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in custody and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on or about August 25, 2015, at Eagle Butte, Red Bird knowingly possessed a firearm and was a prohibited person, including having a prior felony.
The charges are merely an accusation and Red Bird is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Cheyenne River Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Jay Miller is prosecuting the case.
Red Bird was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
District Man Sentenced to 10 Years in Prison for Fatally Shooting Man Following Argument About Victim's DogRead the Press Release
WASHINGTON – Rickey Jones, also known as Heritage Rickey Jones, 22, of Washington, D.C., was sentenced today to 10 years in prison for the shooting death of a man last year in Southeast Washington, U.S. Attorney Channing D. Phillips announced.
Jones pled guilty in October 2015, in the Superior Court of the District of Columbia to charges of voluntary manslaughter and carrying a pistol without a license. The plea, which was contingent on the Court’s approval, called for a sentence of 10 years in prison. The Honorable Robert E. Morin accepted the plea today and sentenced Jones accordingly. Upon completion of his prison term, Jones will be placed on five years of supervised release.
According to the government’s evidence, on Sunday, Nov. 30, 2014, Jones and the victim, Kirk Perry, 50, got into verbal arguments in the 2400 block of Elvans Road SE over Mr. Perry’s dog. During those arguments, Jones said, “I got a 4-5 with an extended clip for your dog.” Mr. Perry and a family member left the area and went to a nearby laundromat.
About three hours after the argument, Mr. Perry returned to his apartment complex. While bringing laundry into the apartment, he again saw Jones outside. After a mutual associate approached Mr. Perry and suggested that he speak with Jones, Mr. Perry returned outside in hopes of settling their dispute. At approximately 12:35 a.m., on Dec. 1, 2014, Mr. Perry had a conversation with Jones that occurred in between two parked cars in a parking lot of the apartment complex on Elvans Road where they both resided. At the time of that conversation, Mr. Perry had a firearm tucked into his waistband.
Jones, armed with a pistol, fired at Mr. Perry and Mr. Perry was struck multiple times. When Mr. Perry fell to the ground face down, Jones continued firing his weapon. Mr. Perry suffered 13 gunshot wounds, including two in his back. When medical and law enforcement personnel arrived, they transported Mr. Perry to a nearby medical facility where Mr. Perry was pronounced dead.
In announcing the sentence, U.S. Attorney Phillips commended the work of the detectives of the Criminal Investigations Division Homicide Branch, crime scene officers, and the Seventh Police District of the Metropolitan Police Department. He also expressed appreciation for the work of the D.C. Department of Fire and Emergency Medical Services and the D.C. Office of the Chief Medical Examiner. He acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Victim/Witness Advocate Jennifer Clark; Victim/Witness Security Specialist Tanya Via; Paralegal Specialists Zekiah Wright and Debra Joyner; Investigative Analyst Zachary McMenamin, and Assistant U.S. Attorney Natalia Medina. Finally, he praised the work of Assistant U.S. Attorney Robert Eckert, who investigated and prosecuted the case.
Director/Treasurer of Non-Profits Sentenced for Stealing over $2 MillionRead the Press Release
Greenbelt, Maryland – U.S. District Judge Peter J. Messitte sentenced Michael Parry, age 59, of Windermere, Florida today to four years in prison, followed by two years of supervised release and 150 hours of community service, for wire fraud and money laundering.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation, Baltimore Field Office; and Frank Robey, Director of the U.S. Army Criminal Investigation Command's Major Procurement Fraud Unit.
According to his plea agreement, in 1998 Parry was hired by the American Registry of Pathology (ARP) as its director of operations, and was promoted to executive director in 2014, a role he had been acting in since October 2011. The ARP is a non-profit organization that supports pathology services in the armed forces, and also engages in non-governmental work, including the funding of fellowships and research studies in pathology. ARP has administrative offices in Rockville, Maryland and Camden, Delaware.
The International Registry of Pathology (IRP) is a non-profit organization that promotes the study of pathology on an international scale, by supporting pathologists and pathology students in less-developed countries. Parry served as treasurer of IRP. By October 2011, Parry was in control of IRP bank accounts.
From February 17, 2010 to April 21, 2014, Parry directed the payment of money from an ARP account to an IRP account by wire transfers. Parry falsely described the wire transfers as related to medical studies, research grants or other activities normally funded by ARP. Parry fabricated documents including: falsified invoices from a legitimate ARP vendor related to medical research studies; emails from himself to others purporting to memorialize conversations in which Parry sought and was granted approval for funding fictional research fellowships; and wire transfer documents purportedly showing that payments were made directly from ARP’s accounts to legitimate ARP vendors or educational institutions.
Parry then transferred funds from the IRP account to a personal account he controlled. The total loss to ARP as a result of the fraud scheme was $2,199,504.09. Parry has paid restitution in full.
United States Attorney Rod J. Rosenstein commended the FBI and Army CID for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Joseph R. Baldwin and David L. Salem, who prosecuted the case.
Denver man is found guilty of Conspiracy to Defraud the IRS and False StatementsRead the Press Release
DENVER – Austin Ray, age 48, of Denver, Colorado, who owned and operated Cheapertaxes LLC in Denver, CO, was convicted by a jury late Wednesday night in U.S. District of Colorado on one count of conspiracy to defraud the United States, two counts of assisting in the preparation of false income tax returns, and two counts of signing and submitting his own false tax returns, announced U.S. Attorney John Walsh and IRS Criminal Investigation Special Agent in Charge Stephen Boyd.
Ray and his co-conspirator Anne Rasamee, were Indicted by a federal grand jury in Denver on April 10, 2014 followed by a superseding Indictment on December 2, 2014 and a 2nd superseding Indictment of January 6, 2015. Rasamee pled guilty on January 20, 2015 to one count of conspiracy to defraud the United States.
Ray and Rasamee owned and operated Cheapertaxes LLC, a tax preparation business in Colorado. Beginning in March 2006 through April 2010, they conspired to defraud the IRS by preparing fraudulent income tax returns containing false income and deductions, for the purpose of obtaining inflated tax refunds for their clients. They falsified itemized deductions on Schedule A, business losses on Schedule C and personal exemptions.
They used ProSeries tax software to prepare their clients' returns. The software included a function that summarized the tax due and the amount of the refund as the preparer entered information in to the tax return. This summary continuously updated as information was added or deleted. Rasamee and Ray watched this summary as they entered information on the tax return, inflating and/or fabricating taxpayers' expenses and deductions in order to maximize the refund and minimize the tax due and owing. In short, they "played with the numbers" until they had entered enough deductions and expenses that as much of the tax due and owing as possible was converted into a refund.
They usually charged their clients a flat fee of $200 to $250 for the return preparation. If clients could not pay the fee at the time of the return preparation, they would take the fee out of the taxpayer's refund. To do so, they caused the refund to be deposited into the Cheapertaxes bank account. To further conceal the scheme, they would list a third party who had not prepared the fraudulent tax return as the return preparer on the client’s return.
Ray and Rasamee shared the proceeds from their business and spent the funds on living expenses for their family as well as luxury items. For example, in 2009, Rasamee and Ray purchased a used Bentley and a used Maserati for $140,000 cash.
Conspiracy to defraud the United States carries a penalty of not more than 5 years in federal prison, and a fine of up to $250,000. A false statement to the IRS carries a penalty of not more than 3 years in federal prison, and a fine of up to $250,000.
“The defendant thought he could become wealthy on the back of U.S. taxpayers," said U.S. Attorney John Walsh. "Thanks to the hard work of the jury, the presentation by the two Assistant U.S. Attorneys, and the investigation conducted by the IRS CI, this tax cheat will be held accountable for his crimes."
"This is a prime example of a return preparer you want to avoid. As we approach filing season, choose carefully when hiring a tax preparer and avoid tax preparers who claim they can obtain larger refunds than other preparers," said Stephen Boyd, Special Agent in Charge for IRS Criminal Investigation, Denver Field Office.
For tips on Choosing a Tax Professional go to www.irs.gov.
This case was investigated by Internal Revenue Service – Criminal Investigation with assistance from the Special Enforcement Program of the Internal Revenue Service and prosecuted by Assistant U.S. Attorneys Anna Edgar and Tim Neff.
Dance Instructor Sentenced for Traveling Interstate to Engage in Illicit Sexual ConductRead the Press Release
PROVIDENCE, R.I. – Keith Sampson, 37, of South Easton, Mass., a former dance instructor in Rhode Island, was sentenced today to 60 months in federal prison for traveling interstate to engage in illicit sexual conduct with a 15-year-old female he instructed at a Rhode Island dance studio. Sampson recently completed a seven-and-one-half year state prison term in Massachusetts in this and other criminal matters.
At sentencing, U.S. District Court Chief Judge William E. Smith also ordered Sampson to serve 10 years supervised release upon completion of his federal prison term, during which time he will be prohibited from being in the company without supervision of anyone under the age of 18. Additionally, Sampson must register as a sex offender.
Sampson pleaded guilty on November 10, 2015, to traveling interstate to engage in illicit sexual conduct.
Sampson’s federal sentence is announced by United States Attorney Peter F. Neronha and Harold H. Shaw, Special Agent in Charge of the Boston Field Office of the FBI.
At the time of his guilty plea in federal court, Sampson admitted to the court that on December 29, 2007, the 15-year-old victim had been left in his care by her mother, on the pretense that the teenager would be spending the night at Sampson's Providence residence in the company of his wife and child. Instead, Sampson admitted that he drove the victim to the home of a relative in Easton, Mass., where he provided the victim with alcohol and then sexually assaulted her.
According to court documents and information presented to the court, the assault occurred while Sampson was awaiting trial in Massachusetts state court in an unrelated matter on two counts of statutory rape of a child. In that case, on January 10, 2008, a jury convicted Sampson of one count of statutory rape. He was sentenced to serve not less than four and not more than seven years imprisonment in Massachusetts state prison.
Additionally, based on the December 29, 2007, assault of his dance studio student, Sampson was indicted and charged in Massachusetts state court with rape of a child with force and providing liquor to a person under 21. He pleaded guilty on November 14, 2011, and was sentenced to not less than two-and-a-half and not more than three years imprisonment, to be served consecutive to the sentence he received as a result of his January 2008 conviction.
This case was prosecuted in federal court by Assistant U.S. Attorneys Zachary A. Cunha and Richard W. Rose.
The matter was investigated by the FBI, with the assistance of the Warwick, Rhode Island, and Easton, Massachusetts, Police Departments.
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email: [email protected]
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Crossville Man Pleads Guilty to Kidnapping Woman and Other Violent Acts During Two-Day Crime OrdealRead the Press Release
Douglas M. Davis, 45, of Crossville, Tenn., pleaded guilty yesterday in U.S. District Court to kidnapping; transportation of a stolen vehicle in interstate commerce; being a convicted felon in possession of a firearm and using a firearm during a crime of violence, announced David Rivera, U.S. Attorney for the Middle District of Tennessee.
During a hearing before Chief U.S. District Judge Kevin H. Sharp, Davis admitted that on October 2, 2014, he was visiting two friends at a house in Crossville, Tenn., when he produced a semi-automatic handgun and forced the female friend to restrain the male friend with duct tape. After securing the man’s hands and feet, Davis forced the woman to help drag the man into the bathroom, where he was left bound and secured. Davis admitted that he then forced the woman to engage in various sex acts and beat and raped her.
After raping the woman, Davis admitted that he took $50 from the man’s wallet and assaulted him and left him duct taped in the bathroom. Davis then forced the woman into the man’s car and subsequently drove to a remote location in Hardin County, Kentucky, where he abandoned the stolen car. Davis then forced the victim into a wooded area and raped her repeatedly. Davis raped the victim again in Bullitt County, Kentucky and again at an unknown location.
On October 4, 2014, law enforcement officers located Davis and the female victim hiding behind a trash dumpster at a Pilot gas station in Lebanon Junction, Kentucky. At the time of his arrest, Davis was in possession of a loaded .25 caliber semi-automatic handgun. Davis told law enforcement officers that he had been in love with the victim since he first met her and that he had planned on releasing her and committing suicide.
Davis had previously been convicted of felony burglary in the State of Florida. He will be sentenced on April 25, 2016, and faces a maximum sentence of life in prison.
This case was investigated by the FBI; the Cumberland County Sheriff’s Department; the Kentucky State Police; the Hardin County, Kentucky Sheriff’s Department; and the Bullitt County, Kentucky Sheriff’s Department. Assistant United States Attorney Lynne T. Ingram prosecuted the case.