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3 December 2015
Ten Individuals Indicted for Conspiracy to Commit Federal Programs Bribery, Honest Services Wire Fraud and ExtortionRead the Press Release
SAN JUAN, Puerto Rico– Ten Puerto Rico businessmen and government officials have been indicted for their alleged participation in several schemes to corruptly give things of value to public officials within the government of the Commonwealth of Puerto Rico in exchange for favorable treatment and awarding of government contracts to various corporations. The 25-count indictment includes charges of conspiracy to commit federal programs bribery and honest services wire fraud, wire fraud, federal program bribery, extortion through fear of economic harm, money laundering, false declarations before a grand jury, and obstruction of justice, announced U.S. Attorney Rosa Emilia Rodríguez-Vélez of the District of Puerto Rico. The Federal Bureau of Investigation is in charge of the investigation.
The indictment, returned on December 2, 2015, by a federal grand jury in the District of Puerto Rico, includes twenty-five charges against the following individuals:
- Anaudi Hernández Pérez, businessman and political fund raiser. Although not named in official corporate records, he exercised de facto control over numerous companies doing business with agencies and public corporations of the Commonwealth of Puerto Rico.
- Sally López Martínez, Administrator of the Commonwealth of Puerto Rico’s “Administración de Desarrollo Laboral” (Workforce Development Administration) (hereinafter “ADL”).
- Sonia M. Barreto Colón, Purchasing Director of the Commonwealth of Puerto Rico’s “Autoridad de Acueductos y Alcantarillados” (Puerto Rico Aqueduct and Sewer Authority) (hereinafter “AAA”).
- Ivonne M. Falcón Nieves, Vice President of AAA.Prior to her position as Vice President, Ivonne M. Falcón Nieves served as Treasurer of AAA.
- Javier A. Muñiz Álvarez, businessman. Utilized the Company JM Profesional (sic) & Training Group, Inc. to secure contracts from the Commonwealth of Puerto Rico.
- Carlos F. Luna Cruz, businessman. Worked for JM Profesional (sic) & Training Group, Inc.
- Xavier González Calderón, Administrator for the House of Representatives of the Commonwealth of Puerto Rico.
- Victor R. Burgos Cotto, Director of Technology for the House of Representatives.
- Marielis Falcón Nieves, sister of Ivonne M. Falcón Nieves.
- Glenn O. Rivera Pizarro, Special Assistant for Administration at the House of Representatives of Puerto Rico.
According to the indictment, Hernández Pérez utilized his political and personal connections with high ranking members of the current government in order to have “his people” appointed in critical government positions within the new administration which took over after the November 2012 elections. He also provided those individuals with things of value in exchange for government contracts, benefits and preferential treatment for several of his corporations. The indictment focuses on benefits Hernández Pérez, his co-conspirators, and corporate entities, obtained from the Commonwealth of Puerto Rico’s “Administración de Desarrollo Laboral” (Workforce Development Administration) (hereinafter “ADL”), the Commonwealth of Puerto Rico’s “Autoridad de Acueductos y Alcantarillados” (Puerto Rico Aqueduct and Sewer Authority) (hereinafter “AAA”), and the Puerto Rico House of Representatives. The three schemes detailed in the indictment essentially followed the same modus operandi.
The indictment alleges that beginning in or about late 2012, and continuing in or about early 2013, Hernández Pérez and several unindicted co-conspirators formalized their plans to obtain government contracts with numerous governmental entities. Hernández Pérez utilized his personal friendship with Person B (brother of the Governor of Puerto Rico, identified as Person A in the Indictment), and the good will generated by his substantial fundraising activities during the 2012 election cycle, to position himself to successfully make recommendations on behalf of individuals seeking government appointments and employment after the election.
Hernández Pérez received numerous emails and resumes from individuals seeking his assistance in obtaining positions within the newly elected government. Hernández Pérez, in turn, forwarded many of those emails to government officials, and to the governor’s brother, Person B. Many of these individuals ultimately received government employment. Hernández Pérez and his co-conspirators then set out to form and make alliances with various corporations and limited liability companies that would be used to obtain government contracts, proposals and purchase orders. These companies included: 3 Comm Global, Inc., Links Group, LLC, EKO Technologies, LLC, JM Profesional (sic) & Training Group, Inc., and Waffler Avenue, LLC. Some of these corporations were formed immediately prior to, or after, the general elections of November 2012.
Hernández Pérez and his co-conspirators were careful to ensure that his name did not appear on any official documentation regarding the formation of the corporations, or on any formal request for government contracts, proposals, or purchase orders. Hernández Pérez, however, was present in numerous meetings where the proposals were discussed, was included in internal electronic and oral communications regarding these matters, and received payment from the contracts into corporate bank accounts and other suspicious transactions.
Many of the individuals recommended by Hernández Pérez whom obtained the jobs, ultimately had the authority to approve or authorize contracts, purchase orders, and other financial obligations on behalf of their respective agencies, departments or public corporations, and in return for the recommendations for employment, and/or other things of value, authorized contracts, purchase orders, proposals and payments on behalf of the co-conspirators and their corporations.
Hernández Pérez and his co-conspirators offered and gave, and the public officials solicited and accepted from Hernández Pérez and his co-conspirators, things of value, including expensive meals, personal gifts, expensive fountain pens, purses, bags, concert tickets, and the payment of certain accrued debts. Hernandez Perez allegedly kept written electronic records regarding the purpose of his government related business meetings, and the things of value provided to each of these individuals.
Hernández Pérez and his co-conspirators utilized their government influence to receive an unfair competitive advantage over their competitors, in that they: a) received preferred opportunities on certain government “request for proposals” (“RFPs”); b) received guidance from agency employees on the proper format and content of proposals and bids for government contracts; c) had access to speak and meet with critical employees in decision making positions within the agencies, departments and government corporations; d) received guidance on how to structure bids and proposals in order to avoid the formal bidding process required by law; e) demanded and were provided with explanations from agency employees when their proposals or bids were not selected.
Once awarded the government contracts, Hernández Pérez and his co-conspirators would utilize, often without proper contractual authority, subcontractors who would perform the work defined in the contracts. On many occasions, Hernández Pérez and his co-conspirators provided substandard work on their contractual obligations in that they: a) failed to make the required payments to suppliers, subcontractors and creditors; b) failed to abide by the terms of the contract regarding performance results/follow up as required under the contract; c) failed to competently provide the services they were contracted to perform.
Hernández Pérez is also charged, along with defendants Ivonne Falcón and Marielis Falcón, with Hobbs Act extortion under fear of economic harm. Hernández Pérez and unindicted co-conspirators would utilize their contacts and influence within at least one government dependency (the AAA) to secure, for a fee, the release of legitimate payments due to other corporations, which lacked the current connections within the government. In particular, Hernández Pérez and his associates, obtained property not due to them, specifically, $100,000.00 from Contractor A, in exchange for utilizing his connections within AAA in order to secure a portion of the money owed (approximately $1,000,000) to Contractor A, with Contractor A’s consent, induced through the wrongful use of a fear of economic loss. Moreover, the Falcón sisters, aided and abetted each other to commit extortion. Defendant Ivonne M. Falcón Nieves utilized her position at AAA in order to enable her sister, defendant Marielis Falcón Nieves, to obtain property not due to her, specifically, cash payments, check payments, payments to contractors, and the performance of residential tree trimming, from Contractor A, with Contractor A’s consent, induced through the wrongful use of a fear of economic loss.
The 25 counts detailed in the Indictment are as follows:
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Count 1: 18 U.S.C. § 371, Conspiracy to Commit Federal Programs Fraud and Honest Services Wire Fraud regarding contracts with ADL and AAA.
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Count 2: 18 U.S.C. § 1349, Conspiracy to Commit Honest Services Wire Fraud for scheme with ADL.
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Counts 3-5: 18 U.S.C. § 343, substantive Wire Fraud counts for emails related to the scheme with ADL.
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Count 6: 18 U.S.C. § 1349, Conspiracy to Commit Honest Services Wire Fraud for the scheme with AAA.
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Counts 7-9: 18 U.S.C. § 1343, substantive Wire Fraud counts for emails related to the scheme with AAA.
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Count 10: 18 U.S.C. § 666(a)(2), paying a bribe to an agent of an organization receiving federal funds for the scheme with ADL (Sally López Martínez).
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Count 11: 18 U.S.C. § 666(a)(1)(B), receipt of a bribe by an agent of an organization receiving federal funds for the scheme with ADL.
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Count 12: 18 U.S.C. § 666(a)(2), paying a bribe to an agent of an organization receiving federal funds for the scheme with AAA (Ivonne Falcón).
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Count 13: 18 U.S.C. § 666(a)(1)(B), receipt of a bribe by an agent of an organization receiving federal funds for the scheme with AAA (Ivonne Falcón).
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Count 14: 18 U.S.C. § 666(a)(2), paying a bribe to an agent of an organization receiving federal funds for the scheme with AAA (Sonia Barreto).
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Count 15: 18 U.S.C. § 666(a)(1)(B), receipt of a bribe by an agent of an organization receiving federal funds for the scheme with AAA (Sonia Barreto).
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Count 16: 18 U.S.C.§ 1951(a), Extortion Through Fear of Economic Harm (Hernandez Perez).
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Count 17: 18 U.S.C.§ 1951(a), Extortion Through Fear of Economic Harm (Ivonne & Marielis Falcón Nieves).
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Count 18: 18 U.S.C. § 1956(h), Conspiracy to Commit Money Laundering (Hernandez Perez and Muñiz Alvarez).
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Count 19: 18 U.S.C. § 1623(a), False Declarations Before Grand Jury (Carlos F. Luna Cruz).
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Count 20: 18 U.S.C. § 1623(a), False Declarations Before Grand Jury (Carlos F.Luna Cruz).
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Count 21: 18 U.S.C. § 1512(c)(2), Obstruction of Justice (Carlos F.Luna Cruz).
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Count 22: 18 U.S.C. § 1512(c)(2), Obstruction of Justice (Carlos F.Luna Cruz).
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Count 23: 18 U.S.C. § 1512(c)(2), Obstruction of Justice (Carlos F.Luna Cruz and Javier A. Muñiz Álvarez (computer)).
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Count 24: 18 U.S.C. § 1346, Conspiracy to Commit Wire Fraud (money and property) for scheme with PR House of Representatives.
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Count 25: 18 U.S.C. § 666(a)(1)(A), Intentional misapplication of funds by an agent of an organization receiving federal funds for the scheme with House of Representatives (González Calderón, Burgos Cotto and Rivera Pizarro).
“For decades now, political cronyism, favoritism, and corruption have robbed the people of Puerto Rico of the right to decent services and unbiased representation, including legally awarded government contracts. The people of Puerto Rico foot the bill for the underhanded dealings detailed in the indictment. The time for government cronyism that allows some to line their pockets with ill-gotten contracts at the expense of the many, is over. The time for public servants who trade their duty to represent the people of Puerto Rico in exchange for political appointments and gifts, is also over. The people of Puerto Rico deserve the honest services of, not only those in their government, but those who choose to do business with the government. Their violations of the public trust will be prosecuted to the full extent of the law,” stated Rosa Emilia Rodríguez Vélez, US Attorney for the District of Puerto Rico.
“Unfortunately, this is one more case of graft, greed, and corruption that over the last 20 years have contributed to the Government of Puerto Rico’s fragile financial condition and on the brink of bankruptcy. It is the responsibility of the leaders of the Government of Puerto Rico to ensure this type of reprehensible and corrupt behavior does not occur. The FBI along with the United States Attorney’s Office, District of Puerto Rico will always remain vigilant and attack the corruption threat with undeniable and fervent passion. Let there be no doubt this is only the beginning and the investigation will continue. There will be no stone left unturned,” said Carlos Cases, Special Agent in Charge of the FBI, San Juan Division.
The case is being investigated by the FBI’s San Juan Division. The case is being prosecuted by First Assistant U.S. Attorney Timothy Henwood and José Capó Iriarte, Deputy Chief of the Financial Fraud and Corruption Unit. If found guilty, the defendants are facing possible sentences of up to five years for the conspiracy to commit federal programs fraud and wire fraud, up to 10 years for honest services fraud, up to 20 years for money laundering, Hobbs act, obstruction of justice, and conspiracy to commit honest services fraud.
The charges contained in the indictment are merely accusations. The defendants are presumed innocent unless and until proven guilty.
Stony Creek Bank Robber Sentenced to More Than 12 Years in PrisonRead the Press Release
RICHMOND, Va. – Troy A. Clanton, Jr., 24, of Petersburg, was sentenced today to 147 months in prison for the robbery of the Bank of Southside Virginia (BSV) located in Stony Creek. Clanton was ordered by the Court to pay $20,278.29 to the victims of the crime.
Clanton plead guilty on May 18, 2015, to bank robbery and to brandishing a firearm in furtherance of a crime of violence. According to court documents, Clanton and an accomplice robbed the BSV on Dec. 29, 2014, entering the bank wearing a mask and armed with two handguns. Clanton and his co-conspirator stole $22,514 from BSV and fled from the scene. While making his getaway, Clanton dropped multiple personal documents with his name, date of birth, and phone number on the ground outside the bank. On Jan. 7, 2015, Clanton was arrested by police after a vehicular pursuit. At the time of arrest, Clanton was in possession of currency stolen from the BSV and the two handguns used in the robbery.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Adam S. Lee, Special Agent in Charge of the FBI’s Richmond Field Office, made the announcement after sentencing by U.S. District Judge Robert E. Payne. Assistant U.S. Attorney Erik S. Siebert prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:15-cr-61.
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Steroid Dealer SentencedRead the Press Release
Contact Person: Bill Day (803) 929-3000
Columbia, South Carolina---- United States Attorney Bill Nettles stated that Christopher Brit Beebe, has been sentenced in federal court in Columbia, South Carolina, for, Conspiracy to Distribute Steroids and Possession of a Firearm in Relation to a Drug Trafficking Crime, a violation of 21 U.S.C. § 846 and 18 U.S.C. 924. United States District Judge Cameron McGowan Currie sentenced Beebe to 97 months imprisonment; 5 years supervised release and a $200.00 special assessment.
Evidence presented at the change of plea hearing established that Beebe and others manufactured and then distributed steroids from 2004 to 2015 throughout the United States using the internet. The conspiracy was discovered when Kershaw County Sheriff Deputies responded to a report that Beebe’s girlfriend, Candace Altman, had been killed by a gunshot to the head at Beebe’s residence in Bethune, S.C. On arrival, officers discovered a large amount of steroids. The case was investigated by the Kershaw County Sheriff’s Office and agents of DEA Diversion. Assistant United States Attorney William E. Day, II, of the Columbia office prosecuted the case.
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Statesboro City Councilman Indicted for Attempted ExtortionRead the Press Release
STATESBORO, GA – Gary Lavon Lewis, 65, a City Councilman for the past 17 years in Statesboro, Georgia, was indicted today by a federal grand jury on a charge of attempted extortion. According to the Indictment, Lewis attempted to obtain $2,500 in cash from a local businessman in return for official acts, specifically, the passage of a local ordinance permitting drive-through alcohol sales.
Lewis faces a maximum sentence of 20 years in prison, a $250,000 fine, and three years of supervised release. The indictment is only an accusation and is not evidence of guilt. Lewis is entitled to a fair trial, during which it will be the Government’s burden to prove his guilt of the charge in the Indictment beyond a reasonable doubt.
The case was investigated by the Statesboro office of the FBI. Assistant United States Attorney R. Brian Tanner is prosecuting the case on behalf of the United States. Any questions should be directed to First Assistant United States Attorney James D. Durham at (912) 201-2547.
Spartanburg Man Sentenced to 60 Months on Child Porn ChargesRead the Press Release
Contact Person: Bill Watkins (864) 282-2100
Columbia, South Carolina ---- United States Attorney Bill Nettles stated today that Robert L. Bullard IIII, age 61, of Spartanburg, was sentenced today in federal court in Anderson, for possession of child pornography, a violation of Title 18, United States Code, Section 2255A. United States District Judge Timothy M. Cain of Anderson sentenced Bullard to 60 months imprisonment and ordered that he be on supervised release for life.
Evidence presented at the change of plea hearing established that in late 2012, an undercover law enforcement officer was conducting an investigation into individuals using file sharing software to trade child porn. The officer downloaded 39 child pornography files from an account that was later traced to Bullard.
Federal agents obtained a search warrant for Bullard’s home. When confronted with the search warrant, Defendant told agents they would find child pornography on this computer. He admitted that he downloaded child porn to his computer and that he searched for incest and hardcore pre-teen images and videos.
A forensic exam of the computers seized revealed 1035 videos and 4058 still images of children under the age of 18, some of whom were prepubescent minors, engaged in sexual acts and the lascivious display of the genitals.
The case was investigated by agents of the Department of Homeland Security, Office of Investigations. Assistant United States Attorney Bill Watkins of the Greenville office handled the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the United States Attorneys Offices, 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 identify and rescue victims. For more information, please visit www.projectsafechildhood.gov.
####Sixteen Additional FIFA Officials Indicted for Racketeering Conspiracy and CorruptionRead the Press Release
The New Defendants Include Five Current or Former FIFA Executive Committee Members and the Current Presidents of CONCACAF and CONMEBOL; Guilty Pleas for Eight Others, Including Jeffrey Webb and the Former Presidents of the Colombian and Chilean Soccer Federations, also Announced
A 92-count superseding indictment was unsealed earlier today in federal court in Brooklyn, New York, charging an additional 16 defendants with racketeering, wire fraud and money laundering conspiracies, among other offenses, in connection with their participation in a 24-year scheme to enrich themselves through the corruption of international soccer. The superseding indictment also includes additional charges for seven of the defendants still pending extradition following the return of the original indictment last May. The guilty pleas of eight defendants – including Jeffrey Webb, Alejandro Burzaco and José Margulies, three of the defendants indicted last May – were also announced today.
The new defendants charged in the superseding indictment include high-ranking officials of FIFA, the organization responsible for the regulation and promotion of soccer worldwide, as well as high-ranking officials of other soccer governing bodies that operate under the FIFA umbrella. The defendants Alfredo Hawit and Juan Ángel Napout – the current presidents of CONCACAF and CONMEBOL, respectively, as well as current FIFA vice presidents and Executive Committee members – are among the 16 additional soccer officials charged with racketeering and bribery offenses. CONCACAF and CONMEBOL are two of FIFA’s six continental confederations. The new defendants also include Marco Polo del Nero and Ricardo Teixeira, the current and former presidents of the Brazilian soccer federation, both of whom are also former members of the FIFA Executive Committee, as well as José Luís Meiszner and Eduardo Deluca, the current and former general secretaries of CONMEBOL. Within UNCAF, the Central American regional soccer union operating within CONCACAF, the charges in the superseding indictment name the current and/or former presidents of nearly every country in the region: Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama. Taken together, the 27 defendants in the superseding indictment are alleged to have engaged in a number of schemes all designed to solicit and receive well over $200 million in bribes and kickbacks to sell lucrative media and marketing rights to international soccer tournaments and matches, among other valuable rights and properties.
The charges were announced by Attorney General Loretta E. Lynch, FBI Director James B. Comey, U.S. Attorney Robert L. Capers of the Eastern District of New York, Assistant Director in Charge Diego G. Rodriguez of the FBI’s New York Field Office, Chief Richard Weber of Internal Revenue Service-Criminal Investigation (IRS-CI) and Special Agent in Charge Erick Martinez of the IRS-CI Los Angeles Field Office.
Early this morning, Swiss authorities in Zurich arrested two of the defendants charged in the superseding indictment – Hawit and Napout – at the request of the United States. Also this morning, a search warrant was executed at Media World, a sports marketing company based in Miami.
The new charges unsealed today bring the total number of individuals and entities charged to date to 41. Of those, 12 individuals and two sports marketing companies have already been convicted as a result of the ongoing investigation. The convicted defendants have agreed to pay more than $190 million in forfeiture. In addition, more than $100 million has been restrained in the United States and abroad in connection with the alleged criminal activity. The United States has issued mutual legal assistance requests seeking the restraint of assets located in 13 countries around the world.
“The Department of Justice is committed to ending the rampant corruption we have alleged amidst the leadership of international soccer – not only because of the scale of the schemes, or the brazenness and breadth of the operation required to sustain such corruption, but also because of the affront to international principles that this behavior represents,” said Attorney General Lynch. “The message from this announcement should be clear to every culpable individual who remains in the shadows, hoping to evade our investigation: You will not wait us out. You will not escape our focus.” Attorney General Lynch extended her grateful appreciation to the authorities of the government of Switzerland for their continuing outstanding assistance and collaboration in this investigation, and to the authorities in a number of other countries, including Brazil and Colombia, for their assistance as well.
“For decades, these defendants used their power as the leaders of soccer federations throughout the world to create a web of corruption and greed that compromises the integrity of the beautiful game,” said Director Comey. “I want to thank all the agencies for their hard work and for showing the world that we do not tolerate this criminal activity.”
“The charges unsealed today send a clear message to those who corrupted a sport beloved by millions to satisfy their own greed: We are determined to put a stop to bribery and corruption in international soccer and to make room for a new era of integrity and reform,” said U.S. Attorney Capers. “This indictment is the latest step in that effort, but our work is not done. While our investigation continues at home, we also look forward to continuing our collaboration with our international partners, including in particular the Swiss authorities, because there is so much yet to be done.” Mr. Capers extended his thanks to the agents, analysts and other investigative personnel with the FBI New York Eurasian Joint Organized Crime Squad and the IRS-CI Los Angeles Field Office, as well as their colleagues in the United States and abroad, for their continuing tremendous effort in this case. Mr. Capers also thanked the U.S. Marshals Service for its continuing assistance.
“The brazenness with which the individuals indicted today breached the integrity of the U.S. financial system to promote and conceal their criminal schemes is quite alarming,” said Chief Weber. “While it is one of the most complex worldwide financial investigations ever conducted, it is also an eye opener to everyone that such greed and corruption could be hiding in plain sight within the world’s most popular sport. By conspiring to enrich themselves through bribery and kickback schemes relating to media and marketing rights, the defendants undermined the process of fair and open competition, corrupting the beautiful game for their own personal gain.”
The charges in the superseding indictment are merely allegations, and the defendants are presumed innocent unless and until proven guilty.
Overview of the Superseding Indictment
As alleged in the superseding indictment, FIFA and its six continental confederations – including CONCACAF, headquartered in the United States, and CONMEBOL, the confederation headquartered in South America – together with affiliated regional federations, national member associations and sports marketing companies, constitute an enterprise of legal entities associated in fact for purposes of violating the federal racketeering laws. The principal – and entirely legitimate – purpose of the enterprise is to regulate and promote the sport of soccer worldwide.
Like the original indictment, the superseding indictment alleges that between 1991 and the present, the defendants and their co-conspirators corrupted the enterprise by engaging in various criminal activities, including fraud, bribery and money laundering. Two generations of soccer officials abused their positions of trust for personal gain, frequently through an alliance with unscrupulous sports marketing executives who shut out competitors and kept highly lucrative contracts for themselves through the systematic payment of bribes and kickbacks. All told, the soccer officials are charged with conspiring to solicit and receive more than $200 million in bribes and kickbacks in exchange for their official support of the sports marketing executives who agreed to make the unlawful payments.
The schemes alleged in the original indictment related to the solicitation and receipt of bribes and kickbacks by soccer officials from sports marketing executives in connection with the commercialization of the media and marketing rights associated with various soccer matches and tournaments, as well as schemes related to the payment and receipt of bribes and kickbacks in connection with the sponsorship of the Brazilian soccer federation by a major U.S. sportswear company, the selection of the host country for the 2010 World Cup and the 2011 FIFA presidential election.
The new allegations in the superseding indictment relate to a series of bribery schemes in connection with multiple cycles of FIFA World Cup qualifiers and international friendly matches involving six Central American member associations within UNCAF; a bribery scheme implicating many top CONMEBOL officials relating to the sale of broadcasting rights to the CONMEBOL Copa Libertadores over an extended period; and a scheme by an Argentinian sports marketing company to obtain various rights properties from CONCACAF by paying bribes to three Central American soccer officials to cause them to exert their influence in favor of the company.
The 16 New Defendants
As set forth in the superseding indictment, the 16 newly-indicted defendants are all current or former soccer officials who acted at various times in a fiduciary capacity within FIFA and one or more of its constituent organizations:
CONCACAF Region Officials
- Alfredo Hawit: Current FIFA vice president and Executive Committee member and CONCACAF president. Former CONCACAF vice president and Honduran soccer federation president.
- Ariel Alvarado: Current member of the FIFA Disciplinary Committee. Former CONCACAF Executive Committee member and Panamanian soccer federation president.
- Rafael Callejas: Current member of the FIFA Television and Marketing Committee. Former Honduran soccer federation president and former president of the Republic of Honduras.
- Brayan Jiménez: Current Guatemalan soccer federation president and member of the FIFA Committee for Fair Play and Social Responsibility.
- Rafael Salguero: Former FIFA Executive Committee member and Guatemalan soccer federation president.
- Héctor Trujillo: Current Guatemalan soccer federation general secretary and judge on the Constitutional Court of Guatemala.
- Reynaldo Vasquez: Former Salvadoran soccer federation president.
CONMEBOL Region Officials
- Juan Ángel Napout: Current FIFA vice president and Executive Committee member and CONMEBOL president. Former Paraguayan soccer federation president.
- Manuel Burga: Current member of the FIFA Development Committee. Former Peruvian soccer federation president.
- Carlos Chávez: Current CONMEBOL treasurer. Former Bolivian soccer federation president.
- Luís Chiriboga: Current Ecuadorian soccer federation president and member of the CONMEBOL Executive Committee.
- Marco Polo del Nero: Current president of the Brazilian soccer federation. Announced resignation from FIFA Executive Committee on Nov. 26, 2015.
- Eduardo Deluca: Former CONMEBOL general secretary.
- José Luis Meiszner: Current CONMEBOL general secretary.
- Romer Osuna: Current member of the FIFA Audit and Compliance Committee. Former CONMEBOL treasurer.
- Ricardo Teixeira: Former Brazilian soccer federation president and FIFA Executive Committee member.
The Convicted Defendants
The following defendants previously pleaded guilty under seal and agreed to forfeit more than $40 million:
On May 26, 2015, Zorana Danis, the co-founder and owner of International Soccer Marketing Inc., a New Jersey-based sports marketing company, waived indictment and pleaded guilty to a two-count information charging her with wire fraud conspiracy and filing false tax returns. As part of her plea, Danis agreed to forfeit $2 million.
On Nov. 9, 2015, Fabio Tordin, the former CEO of Traffic Sports USA Inc. and currently an executive with Media World LLC, a Miami-based sports marketing company, waived indictment and pleaded guilty to a four-count information charging him with three counts of wire fraud conspiracy and one count of tax evasion. As part of his plea, Tordin agreed to forfeit more than $600,000.
On Nov. 12, 2015, Luis Bedoya, a member of the FIFA Executive Committee, a CONMEBOL vice president and, until last month, the president of the Federación Colombiana de Fútbol, the Colombian soccer federation, waived indictment and pleaded guilty to a two-count information charging him with racketeering conspiracy and wire fraud conspiracy. As part of his plea, Bedoya agreed to forfeit all funds on deposit in his Swiss bank account, among other funds.
On Nov. 16, 2015, Alejandro Burzaco, the former general manager and chairman of the board of Torneos y Competencias S.A., an Argentinian sports marketing company, pleaded guilty to racketeering conspiracy, wire fraud conspiracy and money laundering conspiracy. As part of his plea, Burzaco agreed to forfeit more than $21.6 million.
On Nov. 17, 2015, Roger Huguet, the CEO of Media World and its parent company, waived indictment and pleaded guilty to a three-count information charging him with two counts of wire fraud conspiracy and one count of money laundering conspiracy. As part of his plea, Huguet agreed to forfeit more than $600,000.
On Nov. 23, 2015, Jeffrey Webb, a former FIFA vice president and Executive Committee member, CONCACAF president, Caribbean Football Union Executive Committee member and Cayman Islands Football Association president, pleaded guilty to racketeering conspiracy, three counts of wire fraud conspiracy and three counts of money laundering conspiracy. As part of his plea, Webb agreed to forfeit more than $6.7 million.
On Nov. 23, 2015, Sergio Jadue, a vice president of CONMEBOL and, until last month, the president of the Asociación Nacional de Fútbol Profesional de Chile, the Chilean soccer federation, waived indictment and pleaded guilty to a two-count information charging him with racketeering conspiracy and wire fraud conspiracy. As part of his plea, Jadue agreed to forfeit all funds on deposit in his U.S. bank account, among other funds.
On Nov. 25, 2015, José Margulies, the controlling principal of Valente Corp. and Somerton Ltd, who served as an intermediary who facilitated illicit payments between sports marketing executives and soccer officials, pleaded guilty to racketeering conspiracy, wire fraud conspiracy, and two counts of money laundering conspiracy. As part of his plea, Margulies agreed to forfeit more than $9.2 million.
As previously announced last May, all money forfeited by the defendants is being held in reserve to ensure its availability to satisfy any order of restitution entered at sentencing for the benefit of any individuals or entities that qualify as victims of the defendants’ crimes under federal law.
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The indicted and convicted defendants face maximum terms of incarceration of 20 years for the Racketeer Influenced and Corrupt Organizations Act (RICO) conspiracy, wire fraud conspiracy, wire fraud, money laundering conspiracy, money laundering and obstruction of justice charges. In addition, Tordin and Danis face maximum terms of five and three years in prison, respectively, for the tax charges. Each defendant also faces mandatory restitution, forfeiture and a fine.
The superseding indictment and guilty pleas unsealed today are assigned to the U.S. District Judge Raymond J. Dearie of the Eastern District of New York.
The government’s investigation is ongoing.
The charges and guilty pleas announced today are part of an investigation into corruption in international soccer being led by the U.S. Attorney’s Office of the Eastern District of New York, the FBI’s New York Field Office and the IRS-CI Los Angeles Field Office. The work in the U.S. Attorney’s Office involves prosecutors from the National Security and Cybercrime Section, the Organized Crime and Gang Section, the Business and Securities Fraud Section and the Public Integrity Section. The prosecutors in Brooklyn are receiving considerable assistance from attorneys in various parts of the Justice Department’s Criminal Division in Washington, D.C., including the Office of International Affairs, the Organized Crime and Gang Section, the Asset Forfeiture and Money Laundering Section and the Fraud Section, as well as from INTERPOL Washington.
The charges and guilty pleas announced today are being prosecuted by Assistant U.S. Attorneys Evan M. Norris, Amanda Hector, Darren A. LaVerne, Samuel P. Nitze, M. Kristin Mace, Paul Tuchmann, Keith D. Edelman, Tanya Hajjar and Brian D. Morris of the Eastern District of New York.
The Newly-Indicted Defendants:
ARIEL ALVARADO
Age: 56
Nationality: Panama
MANUEL BURGA
Age: 58
Nationality: Peru
RAFAEL CALLEJAS
Age: 72
Nationality: Honduras
CARLOS CHÁVEZ
Age: 57
Nationality: Bolivia
LUÍS CHIRIBOGA
Age: 69
Nationality: Ecuador
MARCO POLO DEL NERO
Age: 74
Nationality: Brazil
EDUARDO DELUCA
Age: 75
Nationality: ARGENTINA
ALFREDO HAWIT
Age: 64
Nationality: Honduras
BRAYAN JIMÉNEZ
Age: 61
Nationality: Guatemala
JOSÉ LUÍS MEISZNER
Age: 69
Nationality: Argentina
JUAN ÁNGEL NAPOUT
Age: 57
Nationality: Paraguay
ROMER OSUNA
Age: 72
Nationality: Bolivia
RAFAEL SALGUERO
Age: 70
Nationality: Guatemala
RICARDO TEIXEIRA
Age: 68
Nationality: Brazil
HÉCTOR TRUJILLO
Age: 62
Nationality: Guatemala
REYNALDO VASQUEZ
Age: 59
Nationality: El Salvador
The Convicted Defendants:
LUIS BEDOYA
Age: 56
Nationality: Colombia
ALEJANDRO BURZACO
Age: 51
Nationality: Argentina
ZORANA DANIS
Age: 52
Nationality: Belgium
ROGER HUGUET
Age: 52
Nationality: USA, Spain
SERGIO JADUE
Age: 36
Nationality: Chile
JOSÉ MARGULIES
Age: 76
Nationality: Brazil
FABIO TORDIN
Age: 50
Nationality: Brazil
JEFFREY WEBB
Age: 51
Nationality: Cayman Islands
E.D.N.Y. Docket Numbers:
United States v. Zorana Danis, 15 Cr. 240 (RJD)
United States v. Jeffrey Webb et al., 15 Cr. 252 (RJD)
United States v. Fabio Tordin, 15 Cr. 564 (RJD)
United States v. Luis Bedoya, 15 Cr. 569 (RJD)
United States v. Sergio Jadue, 15 Cr. 570 (RJD)
United States v. Roger Huguet, 15 Cr. 585 (RJD)
Sixteen Additional FIFA Officials Indicted for Racketeering Conspiracy and CorruptionRead the Press Release
Guilty Pleas for Eight Others, Including Jeffrey Webb and the Former Presidents of the Colombian and Chilean Soccer Federations, also Announced
A 92-count superseding indictment was unsealed earlier today in federal court in Brooklyn, New York, charging an additional 16 defendants with racketeering, wire fraud and money laundering conspiracies, among other offenses, in connection with their participation in a 24-year scheme to enrich themselves through the corruption of international soccer. The superseding indictment also includes additional charges for seven of the defendants still pending extradition following the return of the original indictment last May. The guilty pleas of eight defendants – including Jeffrey Webb, Alejandro Burzaco and José Margulies, three of the defendants indicted last May – were also announced today.
The new defendants charged in the superseding indictment include high-ranking officials of FIFA, the organization responsible for the regulation and promotion of soccer worldwide, as well as high-ranking officials of other soccer governing bodies that operate under the FIFA umbrella. The defendants Alfredo Hawit and Juan Ángel Napout – the current presidents of CONCACAF and CONMEBOL, respectively, as well as current FIFA vice presidents and Executive Committee members – are among the 16 additional soccer officials charged with racketeering and bribery offenses. CONCACAF and CONMEBOL are two of FIFA’s six continental confederations. The new defendants also include Marco Polo del Nero and Ricardo Teixeira, the current and former presidents of the Brazilian soccer federation, both of whom are also former members of the FIFA Executive Committee, as well as José Luís Meiszner and Eduardo Deluca, the current and former general secretaries of CONMEBOL. Within UNCAF, the Central American regional soccer union operating within CONCACAF, the charges in the superseding indictment name the current and/or former presidents of nearly every country in the region: Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama. Taken together, the 27 defendants in the superseding indictment are alleged to have engaged in a number of schemes all designed to solicit and receive well over $200 million in bribes and kickbacks to sell lucrative media and marketing rights to international soccer tournaments and matches, among other valuable rights and properties.
The charges were announced by Attorney General Loretta E. Lynch, FBI Director James B. Comey, U.S. Attorney Robert L. Capers of the Eastern District of New York, Assistant Director in Charge Diego G. Rodriguez of the FBI’s New York Field Office, Chief Richard Weber of Internal Revenue Service-Criminal Investigation (IRS-CI) and Special Agent in Charge Erick Martinez of the IRS-CI Los Angeles Field Office.
Early this morning, Swiss authorities in Zurich arrested two of the defendants charged in the superseding indictment – Hawit and Napout – at the request of the United States. Also this morning, a search warrant was executed at Media World, a sports marketing company based in Miami.
The new charges unsealed today bring the total number of individuals and entities charged to date to 41. Of those, 12 individuals and two sports marketing companies have already been convicted as a result of the ongoing investigation. The convicted defendants have agreed to pay more than $190 million in forfeiture. In addition, more than $100 million has been restrained in the United States and abroad in connection with the alleged criminal activity. The United States has issued mutual legal assistance requests seeking the restraint of assets located in 13 countries around the world.
“The Department of Justice is committed to ending the rampant corruption we have alleged amidst the leadership of international soccer – not only because of the scale of the schemes, or the brazenness and breadth of the operation required to sustain such corruption, but also because of the affront to international principles that this behavior represents,” said Attorney General Lynch. “The message from this announcement should be clear to every culpable individual who remains in the shadows, hoping to evade our investigation: You will not wait us out. You will not escape our focus.” Attorney General Lynch extended her grateful appreciation to the authorities of the government of Switzerland for their continuing outstanding assistance and collaboration in this investigation, and to the authorities in a number of other countries, including Brazil and Colombia, for their assistance as well.
“For decades, these defendants used their power as the leaders of soccer federations throughout the world to create a web of corruption and greed that compromises the integrity of the beautiful game,” said Director Comey. “I want to thank all the agencies for their hard work and for showing the world that we do not tolerate this criminal activity.”
“The charges unsealed today send a clear message to those who corrupted a sport beloved by millions to satisfy their own greed: We are determined to put a stop to bribery and corruption in international soccer and to make room for a new era of integrity and reform,” said U.S. Attorney Capers. “This indictment is the latest step in that effort, but our work is not done. While our investigation continues at home, we also look forward to continuing our collaboration with our international partners, including in particular the Swiss authorities, because there is so much yet to be done.” Mr. Capers extended his thanks to the agents, analysts and other investigative personnel with the FBI New York Eurasian Joint Organized Crime Squad and the IRS-CI Los Angeles Field Office, as well as their colleagues in the United States and abroad, for their continuing tremendous effort in this case. Mr. Capers also thanked the U.S. Marshals Service for its continuing assistance.
“The brazenness with which the individuals indicted today breached the integrity of the U.S. financial system to promote and conceal their criminal schemes is quite alarming,” said Chief Weber. “While it is one of the most complex worldwide financial investigations ever conducted, it is also an eye opener to everyone that such greed and corruption could be hiding in plain sight within the world’s most popular sport. By conspiring to enrich themselves through bribery and kickback schemes relating to media and marketing rights, the defendants undermined the process of fair and open competition, corrupting the beautiful game for their own personal gain.”
The charges in the superseding indictment are merely allegations, and the defendants are presumed innocent unless and until proven guilty.
Overview of the Superseding Indictment
As alleged in the superseding indictment, FIFA and its six continental confederations – including CONCACAF, headquartered in the United States, and CONMEBOL, the confederation headquartered in South America – together with affiliated regional federations, national member associations and sports marketing companies, constitute an enterprise of legal entities associated in fact for purposes of violating the federal racketeering laws. The principal – and entirely legitimate – purpose of the enterprise is to regulate and promote the sport of soccer worldwide.
Like the original indictment, the superseding indictment alleges that between 1991 and the present, the defendants and their co-conspirators corrupted the enterprise by engaging in various criminal activities, including fraud, bribery and money laundering. Two generations of soccer officials abused their positions of trust for personal gain, frequently through an alliance with unscrupulous sports marketing executives who shut out competitors and kept highly lucrative contracts for themselves through the systematic payment of bribes and kickbacks. All told, the soccer officials are charged with conspiring to solicit and receive more than $200 million in bribes and kickbacks in exchange for their official support of the sports marketing executives who agreed to make the unlawful payments.
The schemes alleged in the original indictment related to the solicitation and receipt of bribes and kickbacks by soccer officials from sports marketing executives in connection with the commercialization of the media and marketing rights associated with various soccer matches and tournaments, as well as schemes related to the payment and receipt of bribes and kickbacks in connection with the sponsorship of the Brazilian soccer federation by a major U.S. sportswear company, the selection of the host country for the 2010 World Cup and the 2011 FIFA presidential election.
The new allegations in the superseding indictment relate to a series of bribery schemes in connection with multiple cycles of FIFA World Cup qualifiers and international friendly matches involving six Central American member associations within UNCAF; a bribery scheme implicating many top CONMEBOL officials relating to the sale of broadcasting rights to the CONMEBOL Copa Libertadores over an extended period; and a scheme by an Argentinian sports marketing company to obtain various rights properties from CONCACAF by paying bribes to three Central American soccer officials to cause them to exert their influence in favor of the company.
The 16 New Defendants
As set forth in the superseding indictment, the 16 newly-indicted defendants are all current or former soccer officials who acted at various times in a fiduciary capacity within FIFA and one or more of its constituent organizations:
CONCACAF Region Officials
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Alfredo Hawit: Current FIFA vice president and Executive Committee member and CONCACAF president. Former CONCACAF vice president and Honduran soccer federation president.
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Ariel Alvarado: Current member of the FIFA Disciplinary Committee. Former CONCACAF Executive Committee member and Panamanian soccer federation president.
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Rafael Callejas: Current member of the FIFA Television and Marketing Committee. Former Honduran soccer federation president and former president of the Republic of Honduras.
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Brayan Jiménez: Current Guatemalan soccer federation president and member of the FIFA Committee for Fair Play and Social Responsibility.
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Rafael Salguero: Former FIFA Executive Committee member and Guatemalan soccer federation president.
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Héctor Trujillo: Current Guatemalan soccer federation general secretary and judge on the Constitutional Court of Guatemala.
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Reynaldo Vasquez: Former Salvadoran soccer federation president.
CONMEBOL Region Officials
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Juan Ángel Napout: Current FIFA vice president and Executive Committee member and CONMEBOL president. Former Paraguayan soccer federation president.
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Manuel Burga: Current member of the FIFA Development Committee. Former Peruvian soccer federation president.
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Carlos Chávez: Current CONMEBOL treasurer. Former Bolivian soccer federation president.
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Luís Chiriboga: Current Ecuadorian soccer federation president and member of the CONMEBOL Executive Committee.
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Marco Polo del Nero: Current president of the Brazilian soccer federation. Announced resignation from FIFA Executive Committee on Nov. 26, 2015.
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Eduardo Deluca: Former CONMEBOL general secretary.
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José Luis Meiszner: Current CONMEBOL general secretary.
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Romer Osuna: Current member of the FIFA Audit and Compliance Committee. Former CONMEBOL treasurer.
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Ricardo Teixeira: Former Brazilian soccer federation president and FIFA Executive Committee member.
The Convicted Defendants
The following defendants previously pleaded guilty under seal and agreed to forfeit more than $40 million:
On May 26, 2015, Zorana Danis, the co-founder and owner of International Soccer Marketing Inc., a New Jersey-based sports marketing company, waived indictment and pleaded guilty to a two-count information charging her with wire fraud conspiracy and filing false tax returns. As part of her plea, Danis agreed to forfeit $2 million.
On Nov. 9, 2015, Fabio Tordin, the former CEO of Traffic Sports USA Inc. and currently an executive with Media World LLC, a Miami-based sports marketing company, waived indictment and pleaded guilty to a four-count information charging him with three counts of wire fraud conspiracy and one count of tax evasion. As part of his plea, Tordin agreed to forfeit more than $600,000.
On Nov. 12, 2015, Luis Bedoya, a member of the FIFA Executive Committee, a CONMEBOL vice president and, until last month, the president of the Federación Colombiana de Fútbol, the Colombian soccer federation, waived indictment and pleaded guilty to a two-count information charging him with racketeering conspiracy and wire fraud conspiracy. As part of his plea, Bedoya agreed to forfeit all funds on deposit in his Swiss bank account, among other funds.
On Nov. 16, 2015, Alejandro Burzaco, the former general manager and chairman of the board of Torneos y Competencias S.A., an Argentinian sports marketing company, pleaded guilty to racketeering conspiracy, wire fraud conspiracy and money laundering conspiracy. As part of his plea, Burzaco agreed to forfeit more than $21.6 million.
On Nov. 17, 2015, Roger Huguet, the CEO of Media World and its parent company, waived indictment and pleaded guilty to a three-count information charging him with two counts of wire fraud conspiracy and one count of money laundering conspiracy. As part of his plea, Huguet agreed to forfeit more than $600,000.
On Nov. 23, 2015, Jeffrey Webb, a former FIFA vice president and Executive Committee member, CONCACAF president, Caribbean Football Union Executive Committee member and Cayman Islands Football Association president, pleaded guilty to racketeering conspiracy, three counts of wire fraud conspiracy and three counts of money laundering conspiracy. As part of his plea, Webb agreed to forfeit more than $6.7 million.
On Nov. 23, 2015, Sergio Jadue, a vice president of CONMEBOL and, until last month, the president of the Asociación Nacional de Fútbol Profesional de Chile, the Chilean soccer federation, waived indictment and pleaded guilty to a two-count information charging him with racketeering conspiracy and wire fraud conspiracy. As part of his plea, Jadue agreed to forfeit all funds on deposit in his U.S. bank account, among other funds.
On Nov. 25, 2015, José Margulies, the controlling principal of Valente Corp. and Somerton Ltd, who served as an intermediary who facilitated illicit payments between sports marketing executives and soccer officials, pleaded guilty to racketeering conspiracy, wire fraud conspiracy, and two counts of money laundering conspiracy. As part of his plea, Margulies agreed to forfeit more than $9.2 million.
As previously announced last May, all money forfeited by the defendants is being held in reserve to ensure its availability to satisfy any order of restitution entered at sentencing for the benefit of any individuals or entities that qualify as victims of the defendants’ crimes under federal law.
The indicted and convicted defendants face maximum terms of incarceration of 20 years for the Racketeer Influenced and Corrupt Organizations Act (RICO) conspiracy, wire fraud conspiracy, wire fraud, money laundering conspiracy, money laundering and obstruction of justice charges. In addition, Tordin and Danis face maximum terms of five and three years in prison, respectively, for the tax charges. Each defendant also faces mandatory restitution, forfeiture and a fine.
The superseding indictment and guilty pleas unsealed today are assigned to the U.S. District Judge Raymond J. Dearie of the Eastern District of New York.
The government’s investigation is ongoing.
The charges and guilty pleas announced today are part of an investigation into corruption in international soccer being led by the U.S. Attorney’s Office of the Eastern District of New York, the FBI’s New York Field Office and the IRS-CI Los Angeles Field Office. The work in the U.S. Attorney’s Office involves prosecutors from the National Security and Cybercrime Section, the Organized Crime and Gang Section, the Business and Securities Fraud Section and the Public Integrity Section. The prosecutors in Brooklyn are receiving considerable assistance from attorneys in various parts of the Justice Department’s Criminal Division in Washington, D.C., including the Office of International Affairs, the Organized Crime and Gang Section, the Asset Forfeiture and Money Laundering Section and the Fraud Section, as well as from INTERPOL Washington.
The charges and guilty pleas announced today are being prosecuted by Assistant U.S. Attorneys Evan M. Norris, Amanda Hector, Darren A. LaVerne, Samuel P. Nitze, M. Kristin Mace, Paul Tuchmann, Keith D. Edelman, Tanya Hajjar and Brian D. Morris of the Eastern District of New York.
The Newly-Indicted Defendants:
ARIEL ALVARADO
Age: 56
Nationality: PanamaMANUEL BURGA
Age: 58
Nationality: PeruRAFAEL CALLEJAS
Age: 72
Nationality: HondurasCARLOS CHÁVEZ
Age: 57
Nationality: BoliviaLUÍS CHIRIBOGA
Age: 69
Nationality: EcuadorMARCO POLO DEL NERO
Age: 74
Nationality: BrazilEDUARDO DELUCA
Age: 75
Nationality: ARGENTINAALFREDO HAWIT
Age: 64
Nationality: HondurasBRAYAN JIMÉNEZ
Age: 61
Nationality: GuatemalaJOSÉ LUÍS MEISZNER
Age: 69
Nationality: ArgentinaJUAN ÁNGEL NAPOUT
Age: 57
Nationality: ParaguayROMER OSUNA
Age: 72
Nationality: BoliviaRAFAEL SALGUERO
Age: 70
Nationality: GuatemalaRICARDO TEIXEIRA
Age: 68
Nationality: BrazilHÉCTOR TRUJILLO
Age: 62
Nationality: GuatemalaREYNALDO VASQUEZ
Age: 59
Nationality: El SalvadorThe Convicted Defendants:
LUIS BEDOYA
Age: 56
Nationality: ColombiaALEJANDRO BURZACO
Age: 51
Nationality: ArgentinaZORANA DANIS
Age: 52
Nationality: BelgiumROGER HUGUET
Age: 52
Nationality: USA, SpainSERGIO JADUE
Age: 36
Nationality: ChileJOSÉ MARGULIES
Age: 76
Nationality: BrazilFABIO TORDIN
Age: 50
Nationality: BrazilJEFFREY WEBB
Age: 51
Nationality: Cayman IslandsE.D.N.Y. Docket Numbers:
United States v. Zorana Danis, 15 Cr. 240 (RJD)
United States v. Jeffrey Webb et al., 15 Cr. 252 (RJD)
United States v. Fabio Tordin, 15 Cr. 564 (RJD)
United States v. Luis Bedoya, 15 Cr. 569 (RJD)
United States v. Sergio Jadue, 15 Cr. 570 (RJD)
United States v. Roger Huguet, 15 Cr. 585 (RJD)
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Shreveport man sentenced to 105 months in prison for possessing a rifle after being convicted of a felonyRead the Press Release
SHREVEPORT, La. – United States Attorney Stephanie A. Finley announced today that a Shreveport man was sentenced to 105 months in prison for possessing a firearm and ammunition after being convicted of a felony.
Daranski M. Wynder, 33, of Shreveport, was sentenced by U.S. District Judge S. Maurice Hicks Jr. on one count of possession of a firearm and ammunition by a convicted felon. He was also sentenced to three years of supervised release. According to the August 10, 2015 guilty plea, Shreveport police officers responded to a 911 call on January 6, 2015 reporting that there was a man standing outside his residence with a rifle. Wynder was found at this residence with rifle bullets in his pocket. Police also found a 7.62 by 39 mm rifle and ammunition in his residence. Wynder was convicted in the 26th Judicial District Court in Webster Parish for monetary instrument abuse in 2011. He was also convicted in the First Judicial District Court in Caddo Parish for attempted felon in possession of a firearm in 2005 and for simple burglary in 2001.
This case is part of Project Safe Neighborhoods, a Department of Justice initiative designed to reduce firearm crimes by removing dangerous and persistent felons from the community and promote firearm safety.
The ATF and the Shreveport Police Department conducted the investigation. Assistant U.S. Attorney Robert W. Gillespie Jr. prosecuted the case.
Serial Armed Robbers Known as “Bulls Cap Bandits” Plead Guilty to Federal ChargesRead the Press Release
DALLAS — Three Dallas men have pleaded guilty to their roles in committing several violent armed robberies in Dallas last year, announced U.S. Attorney John Parker of the Northern District of Texas.
Today, Cedric Ray Jones, 26, pleaded guilty, before U.S. District Judge Jane J. Boyle, to one count of conspiracy to interfere with commerce by robbery, two counts of using, carry, and brandishing a firearm during and in relation to, and possessing and brandishing a firearm in furtherance of, a crime of violence, and three counts of interference with commerce by robbery. Last week, his brother, Damien Antoine Jones, 31, pleaded guilty to the same offenses. In mid-November, Savalas Christopher Love, 30, pleaded guilty to the conspiracy count and one firearm count.
The FBI dubbed the robbers the “Bulls Cap Bandits,” as Cedric and Damien Jones wore Chicago Bulls caps during the robberies.
According to documents filed in the case, from approximately March 7, 2014, through June 17, 2014, the defendants conspired together to commit these armed robberies:
March 7, 2014 Cash Plus Pawn and 9103 East R.L. Thornton Freeway, Dallas
June 12, 2014May 28, 2014 AutoZone
10418 Garland Road, DallasJune 2, 2014 AutoZone
2842 South Buckner Blvd., DallasJune 17, 2014 AutoZone
9711 Plano Road, DallasDuring each of the robberies, Cedric and Damien Jones wore disguises and brandished firearms. In the March 7, 2014, robbery of Cash Plus Pawn, they stole cash and two semi-automatic rifles, and then fled on foot.
In the May 28, 2014, and June 2, 2014, AutoZone robberies, Cedric and Damien Jones entered the store, brandishing the semi-automatic rifles, while Love remained in the vehicle as the “getaway driver.” The three fled in Love’s vehicle.
On June 12, 2014, Cedric and Damien Jones, Love, and another individual traveled to the Cash Plus Pawn store on East R.L. Thornton Freeway in Dallas, in Love’s vehicle, with the specific intent to commit robbery. Upon arriving in the parking lot, Damien Jones and the other individual exited the vehicle and approached the store’s entrance with firearms, but abandoned the robbery when confronted by a store employee. They fled in Love’s vehicle.
In the June 17, 2014, AutoZone robbery, Cedric and Damien Jones traveled together in Love’s vehicle to the store with the intent to commit robbery. Love traveled separately to the location. Love “cased” the store and reported the absence of security personnel to Damien Jones. Cedric and Damien Jones then entered the store, brandishing semi-automatic rifles, and then fled the robbery in their vehicle. During a subsequent chase with law enforcement, Cedric Jones operated the vehicle in a manner to avoid apprehension and created a substantial risk to other motorists on the roads. During the pursuit, shots were fired in the direction of the pursuing officers to further avoid apprehension.
The conspiracy count and each of the interference with commerce by robbery counts carries a maximum statutory penalty of 20 years in federal prison and a $250,000 fine. The first firearm conviction carries a mandatory sentence of not less than seven years and up to life in federal prison, to be served consecutively to any other term of imprisonment. The subsequent firearm offense carries a mandatory term of not less than 25 years and up to life in federal prison, to be served consecutively to any other term of imprisonment. The defendants’ sentencing dates are scheduled in March 2016.
The case is being investigated by the FBI and the Dallas Police Department. Assistant U.S. Attorney Keith Robinson is in charge of the prosecution.
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Sentencings for December 1 - December 2, 2015Read the Press Release
Starr Dana Miller, 22, of Arapahoe, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on December 2, 2015, for being a felon in possession of a firearm. Miller was arrested on the Wind River Indian Reservation. He received 37 months imprisonment, to be followed by three years of supervised release, and was ordered to pay a $300.00 fine and a $100.00 special assessment. This case was investigated by the Federal Bureau of Investigation and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Stormie Forrester, 38, of Riverton, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on December 2, 2015, for distribution of methamphetamine. Forrester was arrested in Riverton, Wyoming. She received 147 days of imprisonment, to be followed by three years of supervised release, including five months of home confinement, and was ordered to pay a $100.00 special assessment. This case was investigated by the Wyoming Division of Criminal Investigation, the Federal Bureau of Investigation and the Bureau of Indian Affairs.
Matthew Charles Cook, 42, of Evanston, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on December 2, 2015, for distribution of methamphetamine. Cook was arrested in Evanston, Wyoming. He received 87 months imprisonment, to be followed by four years of supervised release, and was ordered to pay a $400.00 fine and a $100.00 special assessment. This case was investigated by the Wyoming Division of Criminal Investigation.
Oscar Calderon-Galeano, aka Jose Vasquez-Rodriguez, Jose Rodriguez-Vasquez and Jose Hernandez-Herrera, 33, of Mexico, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on December 1, 2015, for illegal re-entry of a previously deported alien into the United States. Calderon-Galeano was arrested in Casper, Wyoming. He received time served, plus ten days, was ordered to pay a $100.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Emilio Chavez-Alcantara, 35, of Mexico, was sentenced by Federal District Court Judge Alan B. Johnson on December 1, 2015, for illegal re-entry of a previously deported alien into the United States. Chavez-Alcantara was arrested in Lander, Wyoming. He received time served, plus ten days, was ordered to pay a $100.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Second Individual Charged in Ongoing New York Power Authority Procurement Fraud InvestigationRead the Press Release
Construction Company Owner Pleads Guilty to Tax Violation
Law enforcement agencies conducting a joint federal and state investigation into bid-rigging, fraud and tax-related offenses in the award of contracts by the New York Power Authority announced today that a construction company owner from Orangeburg, New York, has pleaded guilty to filing a false tax return. This is the second guilty plea in the investigation, which was initiated by the New York State Inspector General.
According to the one-count felony charge filed in the U.S. District Court for the Southern District of New York, in White Plains, New York, Peter Shine filed a Form 1040 for the tax year 2013 that substantially understated his taxable income. Shine pleaded guilty to subscribing to a false tax return, which carries a maximum penalty of three years in prison and a $250,000 fine.
“Business owners who willfully do not report their true income and expenses potentially expose themselves to criminal investigation and the ensuing consequences,” said Special Agent in Charge Shantelle P. Kitchen of the IRS Criminal Investigation’s New York Field Office. “IRS Criminal Investigation is committed to ensuring that everyone pays his or her fair share.”
“Shine essentially siphoned funds he was not entitled to and sidestepped his responsibility to pay taxes on underreported income,” said Assistant Director in Charge Diego G. Rodriguez of the FBI’s New York Field Office. “This guilty plea is proof of the FBI’s continued determination to work with our partners in rooting out those who engage in unlawful schemes for profit.”
“This guilty plea originates from a bid rigging investigation begun at the state level and clearly demonstrates the commitment of my office, and that of my federal law enforcement partners, to follow the evidence wherever it may lead,” said New York State Inspector General Catherine Leahy Scott.
“The division will continue to work with our law enforcement partners to ensure that any crimes uncovered during our investigations will be prosecuted,” said Assistant Attorney General Bill Baer of the Justice Department’s Antitrust Division.
The investigation is being conducted by the Antitrust Division’s New York Office with the assistance of the FBI, IRS Criminal Investigation and the New York State Office of the Inspector General. NYPA is cooperating with the investigation. Anyone with information on bid rigging or other anticompetitive conducted related to the award or performance of municipal and state contracts should contact the Antitrust Division’s Citizen Complaint Center at 888-647-3258 or visit http://www.justice.gov/atr/contact/newcase.html.
Ruston man sentenced to more than 12 years in prison for role in cocaine conspiracyRead the Press Release
SHREVEPORT, La. – U.S. Attorney Stephanie A. Finley announced that a Ruston man was sentenced Wednesday to 147 months in prison for his role in a cocaine conspiracy that stretched across north Louisiana and led to the seizure of more than $517,000 in cash and resulted in charges for seven defendants.
Shannon D’Lario Jenkins, 34, of Ruston, La., was sentenced by U.S. District Judge S. Maurice Hicks Jr. to 87 months in prison on one count of conspiracy to distribute and possess with intent to distribute cocaine and 60 months in prison for possession of a firearm in furtherance of drug trafficking for a total of 147 months. He was also sentenced to four years of supervised release. According to the December 4, 2014 guilty plea, from June 2012 to July 2014, Jenkins along with Quincy D. Hoover, 40, and Quwanda L. Forest, 35, both of Natchez, La.; Jesse C. Thomas, 31, of Haynesville, La.; Rodney J. Raymond, 36, of Natchitoches, La.; Carlos C. Jenkins, 37, of Ruston, and Quincy J. Hobbs, 33, of Grand Prairie, Texas, conspired to distribute cocaine throughout Lincoln, Claiborne, Natchitoches, Sabine, DeSoto, Bossier and Caddo parishes with the source cities for the cocaine being Houston and Dallas. Controlled purchases by law enforcement of cocaine powder and crack cocaine were made from several dealers during the investigation. Federal and local law enforcement officials arrested five of the defendants on July 1, 2014, in the northwest Louisiana area, where more than $517,000 in cash, firearms, 16 pounds of marijuana and other items were seized.
Raymond was sentenced on March 26, 2015, to 97 months in prison and five years of supervised release for conspiracy and possession of a firearm in furtherance of drug trafficking; Forest was sentenced on May 12, 2015, to 47 months in prison and three years of supervised release for conspiracy; and Carlos C. Jenkins was sentenced on June 2, 2015, to 30 months in prison and one year of supervised release for one count of unlawful use of a communication facility. Hobbs, Thomas and Hoover were sentenced on June 29, 2015. Hobbs was sentenced to 87 months in prison and four years of supervised release for conspiracy; Thomas was sentenced to 24 months in prison and three years of supervised release for conspiracy; and Hoover was sentenced to 108 months in prison and five years of supervised release for conspiracy and possession of a firearm in furtherance of drug trafficking.
“The U.S. Attorney's Office, along with our federal, state and local partners, is committed to keeping our communities safe,” Finley stated. “Breaking up this drug distribution ring was a huge step in countering the flow of illegal substances into the community. I want to thank all the agencies who partnered with us on this case and who continue to work to enforce both federal and state narcotics laws.”
The defendants were prosecuted as part of the Organized Crime Drug Enforcement Task Force (OCDETF) Operation Pit Stop. The DEA, U.S. Marshals Service, ICE, ATF, Louisiana State Police, Lincoln Parish Sheriff’s Office, Ruston Police Department, Claiborne Parish Sheriff’s Office, Natchitoches Parish Sheriff’s Office, Natchitoches Police Department, Sabine Parish Sheriff’s Office, DeSoto Parish Sheriff’s Office, Bossier Parish Sheriff’s Office, Bossier City Police Department, Shreveport Police Department, Caddo Parish Sheriff’s Office, all participated in this OCDETF operation. The OCDETF program is a joint federal, state and local cooperative approach to combat drug trafficking and is the nation’s primary tool for targeting national and regional level drug trafficking organizations, coordinating the necessary law enforcement entities and resources, and disrupting and dismantling of major drug trafficking organizations.
Assistant U.S. Attorneys James G. Cowles Jr. and Cytheria D. Jernigan prosecuted the case.
Russian Taliban Fighter Sentenced to Life in Prison in Terrorism CaseRead the Press Release
Led Attack on U.S. and Afghan Forces in Afghanistan in 2009Led Attack on U.S. and Afghan Forces in Afghanistan in 2009
Irek Ilgiz Hamidullin, 55, a Russian national and former Russian army tank commander, was sentenced today to life plus 30 years in prison for conspiring to shoot down American helicopters and to kill U.S. and Afghan soldiers, conspiring to use a weapon of mass destruction and several other charges relating to an attack that he led against U.S. and Afghan forces in Afghanistan in November 2009.
Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Dana J. Boente of the Eastern District of Virginia and Assistant Director in Charge Paul Abbate of the FBI’s Washington, D.C., Field Office made the announcement after sentencing by U.S. District Judge Henry E. Hudson of the Eastern District of Virginia.
“Irek Hamidullin has been sentenced to life in prison for his role in orchestrating and conducting a violent attack on Afghan and U.S. forces in Afghanistan in 2009, and conspiring to kill members of the U.S. military,” said Assistant Attorney General Carlin. “Hamidullin was captured and detained by the U.S. military in Afghanistan and brought to the United States for trial. This case once again demonstrates our resolve to find and bring to justice, using all available tools, those who target U.S. citizens and interests around the world.”
“Few crimes could be more serious than this one,” said U.S. Attorney Boente. “In a well-planned, deliberate, and premeditated attack, Hamidullin led an assault upon an Afghan outpost by a group of insurgents, many of whom he recruited and trained, with the intent to kill Afghan Border Police and responding American forces. Hamidullin is a charismatic proselytizer of the radical views that animate Islamist violence such as that perpetrated by the Taliban and the Haqqani Network upon Americans and Afghans – civilian and military targets alike – especially in 2009 when this attack took place. He not only has the will to do violence himself, but perhaps more dangerously, has the ability and the desire to enlist others to engage in violence. Today’s sentence of life in prison will fulfill our need to protect the public, and will hopefully serve as a deterrent to others contemplating engaging in such actions. I want to commend our trial team and investigating partners for their terrific work in this case.”
“The sentence imposed today on the defendant Hamidullin for masterminding an attack on U.S. military personnel in Afghanistan serves as a reminder of the global reach and determination of the FBI to exact justice through the American legal system,” said Assistant Director in Charge Abbate. “The FBI, together with our partners in the U.S. Attorney’s Office and the U.S. Department of Defense, will continue to relentlessly pursue any person who commits acts of terrorism or supports terrorist organizations targeting American troops, citizens, or interests.”
On Aug. 7, 2015, a federal jury convicted Hamidullin of all 15 counts of the second superseding indictment, which included charges of material support to terrorists, attempted murder of U.S. military personnel, conspiracy to use a weapon of mass destruction and possession of a firearm in connection with a crime of violence. According to court documents and evidence presented at trial, Hamidullin had contact with high-level Taliban and Haqqani Network personnel. On Nov. 28, 2009, Hamidullin led a group of fighters in an attack on a border outpost known as Camp Leyza, located in the Khost Province of Afghanistan, near the border with Pakistan. He had planned the attack for months; received approval from the Taliban and Haqqani Network; recruited other fighters; and acquired weapons for the attack, including IED’s, heavy machine guns and a shoulder-fired rocket, with the intent of shooting down U.S. helicopters responding to the attack.
According to evidence presented at trial, on the night of Nov. 28, 2009, Hamidullin and his fighters initiated their attack with an assault on Camp Leyza. Soon after the attack began, two U.S. Army helicopters responded to Camp Leyza, just as Hamidullin anticipated from his months of planning and reconnaissance. Military witnesses testified at trial that it was a common tactic for insurgents at the time to attack an Afghan position intending to draw in and ambush their real target, the responding U.S. forces.
Hamidullin positioned himself on a nearby hill, away from his fighters, where he had a clear view of the battlefield and could radio orders to his fighters. As the helicopters approached, he ordered his fighters to fire the anti-aircraft weapons he had strategically placed in the area. Both weapons malfunctioned and the helicopters were not fired upon. After the heavy weapons failed to fire, Hamidullin ordered his fighters to pack up their weapons and other gear and return to Pakistan. U.S. military helicopters in the area observed the insurgents “bounding back” in an organized military fashion. Thereafter, a U.S. aircraft spotted the insurgents attempting to set an ambush for the approaching U.S. and Afghan forces. Once the aircraft confirmed that the insurgents were carrying Kalashnikov machine guns and rocket propelled grenade launchers, the U.S. helicopters were given approval to engage the insurgents. U.S. forces ultimately identified and eliminated approximately 20 of Hamidullin’s fighters.
The next morning, as U.S. and Afghan forces were conducting a battle damage assessment, Hamidullin was found hiding on the battlefield. Hamidullin opened fire on the U.S. forces with a Kalashnikov machine gun, but was wounded and captured after a brief firefight. U.S. military personnel testified during the trial that the insurgents were remarkably well-equipped and in addition to the heavy weapons, they were also carrying, for example, GPS devices and $400 military-style watches. During the battle damage assessment, U.S. military personnel found, among other weapons carried by the insurgents, three 50 caliber anti-aircraft machine guns, 82 millimeter recoilless rifles and scores of smaller weapons and grenades. The insurgents were also carrying all the materials necessary to construct three different kinds of improvised explosive devices, which were all of the kind that had been used by insurgents against U.S. forces operating at that time in Khowst Province.
This case was investigated by the FBI’s Washington, D.C., Field Office. The case is being prosecuted by Assistant U.S. Attorney James P. Gillis and former U.S. Attorney Michael Gill of the Eastern District of Virginia and Trial Attorney Jennifer E. Levy of the National Security Division’s Counterterrorism Section.
Russian Taliban Fighter Sentenced to Life in PrisonRead the Press Release
RICHMOND, Va. – Irek Ilgiz Hamidullin, 55, a Russian national and former Russian army tank commander, was sentenced today to life plus 30 years in prison for conspiring to shoot down American helicopters and to kill U.S. and Afghan soldiers, conspiring to use a weapon of mass destruction, and several other charges relating to an attack he led on U.S. and Afghan forces in Afghanistan in November 2009.
“Few crimes could be more serious than this one,” said Dana J. Boente, U.S. Attorney for the Eastern District of Virginia. “In a well-planned, deliberate, and premeditated attack, Hamidullin led an assault upon an Afghan outpost by a group of insurgents, many of whom he recruited and trained, with the intent to kill Afghan Border Police and responding American forces. Hamidullin is a charismatic proselytizer of the radical views that animate Islamist violence such as that perpetrated by the Taliban and the Haqqani Network upon Americans and Afghans – civilian and military targets alike – especially in 2009 when this attack took place. He not only has the will to do violence himself, but perhaps more dangerously, has the ability and the desire to enlist others to engage in violence. Today’s sentence of life in prison will fulfill our need to protect the public, and will hopefully serve as a deterrent to others contemplating engaging in such actions. I want to commend our trial team and investigating partners for their terrific work in this case.”
"Irek Hamidullin has been sentenced to life in prison for his role in orchestrating and conducting a violent attack on Afghan and U.S. forces in Afghanistan in 2009, and conspiring to kill members of the U.S. military,” said Assistant Attorney General Carlin. “Hamidullin was captured and detained by the U.S. military in Afghanistan and brought to the United States for trial. This case once again demonstrates our resolve to find and bring to justice, using all available tools, those who target U.S. citizens and interests around the world."
“The sentence imposed today on the defendant Hamidullin for masterminding an attack on U.S. military personnel in Afghanistan serves as a reminder of the global reach and determination of the FBI to exact justice through the American legal system,” said Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office. “The FBI, together with our partners in the U.S. Attorney’s Office and the U.S. Department of Defense, will continue to relentlessly pursue any person who commits acts of terrorism or supports terrorist organizations targeting American troops, citizens, or interests.”
Hamidullin was convicted by a federal jury of all 15 counts of the second superseding indictment on Aug. 7, 2015, which included charges of material support to terrorists, attempted murder of U.S. military personnel, conspiracy to use a weapon of mass destruction and possession of a firearm in connection with a crime of violence. According to court documents and evidence presented at trial, Hamidullin had contact with high-level Taliban and Haqqani Network personnel. On Nov. 28, 2009, Hamidullin led a group of fighters in an attack on a border outpost known as Camp Leyza, located in the Khost Province of Afghanistan, near the border with Pakistan. He had planned the attack for months; received approval from the Taliban and Haqqani Network; recruited other fighters; and acquired weapons for the attack, including IED’s, heavy machine guns, and a shoulder-fired rocket with the intent of shooting down U.S. helicopters responding to the attack.
According to evidence presented at trial, on the night of Nov. 28, 2009, Hamidullin and his fighters initiated their attack with an assault on Camp Leyza. Soon after the attack began, two U.S. Army helicopters responded to Camp Leyza, just as Hamidullin anticipated from his months of planning and reconnaissance. Military witnesses testified at trial that it was a common tactic for insurgents at the time to attack an Afghan position intending to draw in and ambush their real target, the responding U.S. forces.
Hamidullin positioned himself on a nearby hill, away from his fighters, where he had a clear view of the battlefield and could radio orders to his fighters. As the helicopters approached, he ordered his fighters to fire the anti-aircraft weapons he had strategically placed in the area. Both weapons malfunctioned and the helicopters were not fired upon. After the heavy weapons failed to fir, Hamidullin ordered his fighters to pack up their weapons and other gear and return to Pakistan. U.S. military helicopters in the area observed the insurgents “bounding back” in an organized military fashion. Thereafter, U.S. aircraft spotted the insurgents attempting to set an ambush for the approaching U.S. and Afghan forces. Once the aircraft confirmed that the insurgents were carrying Kalashnikov machine guns and rocket propelled grenade launchers, the U.S. helicopters were given approval to engage the insurgents. U.S. forces ultimately identified and eliminated approximately 20 of Hamidullin’s fighters.
The next morning, as U.S. and Afghan forces were conducting a battle damage assessment, Hamidullin was found hiding on the battlefield. Hamidullin opened fire on the U.S. forces with a Kalashnikov machine gun, but was wounded and captured after a brief firefight. U.S. military personnel testified during the trial that the insurgents were remarkably well-equipped and in addition to the heavy weapons were carrying, for example, GPS devices and $400 military-style watches. During the battle damage assessment, U.S. military personnel found, among other weapons carried by the insurgents, three 50 caliber anti-aircraft machine guns, 82 millimeter recoilless rifles, and scores of smaller weapons and grenades. The insurgents were also carrying all the materials necessary to construct three different kinds of improvised explosive devices, which were all of the kind that had been used by insurgents against U.S. forces operating at that time in Khowst Province.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; John P. Carlin, Assistant Attorney General for National Security; and Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after sentencing by U.S. District Judge Henry E. Hudson.
This case was investigated by the FBI’s Washington Field Office. Assistant U.S. Attorney James P. Gillis, and former Assistant U.S. Attorney Michael Gill of the Eastern District of Virginia, and Trial Attorney Jennifer E. Levy of the National Security Division’s Counterterrorism Section prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:14-cr-00140.
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Romanian National Sentenced for Bank FraudRead the Press Release
U.S. Attorney Kenneth A. Polite announced that MARINICA MIREL COTOI, age 37, of Romania, was sentenced today after previously pleading guilty to one count of bank fraud.
U.S. District Judge Nannette Jolivette Brown sentenced COTOI to 8 months of incarceration, followed by two years of supervised release. Additionally, COTOI was ordered to pay restitution to the victim banks and is subject to deportation following completion of his incarceration.
According to court documents, in January 2015, the U.S. Secret Service and the Louisiana Financial Crimes Task Force began investigating the unauthorized collection of debit card numbers through the installation of “skimming devices” on various ATM machines and the subsequent illegal use of fake debit cards. In March of this year, COTOI and another man rented a hotel room in Covington. Shortly thereafter, COTOI was captured on surveillance video using fake debit cards to withdraw funds from three local bank accounts. COTOI later admitted that he illegally entered the United States.
U.S. Attorney Polite praised the work of the U.S. Secret Service and the Louisiana Financial Crimes Task Force with the assistance of the St. Tammany Parish Sheriff’s Office in investigating this matter. Assistant United States Attorneys Edward Rivera and Carter Guice were in charge of the prosecution.
Ride or Die Gang Members Sentenced on Firearm and Drug ViolationsRead the Press Release
U.S. Attorney Kenneth A. Polite announced that PERRY WILSON, a/k/a “Yummy,” age 24, and TYRONE BURTON, a/k/a “Man Man,” age 21, both of New Orleans, were sentenced today after having previously pled guilty to federal firearm and drug violations.
U.S. District Judge Susie Morgan sentenced WILSON and BURTON to 108 months of imprisonment and 60 months of imprisonment, respectively. Additionally, both defendants will serve four years of supervised release following imprisonment.
WILSON and BURTON were two of twelve defendants charged with conspiring to distribute cocaine base in the St. Roch neighborhood. In addition, all twelve defendants were charged with conspiring to possess firearms in furtherance of their drug trafficking crimes. Three defendants were also charged with conspiring to violate the Racketeer Influenced Corrupt Organization Act, as well as substantive acts of violence.
To date, nine defendants charged in this case have pled guilty to various charges. Co-defendant ANDREALIE LEWIS was previously sentenced to 48 months of incarceration; ERVIN SPOONER was previously sentenced to 108 months of incarceration; TRE CLEMENTS was previously sentenced to 96 months; ROMALIS PARKER was previously sentenced to 70 months; TYONE BURTON was previously sentenced to 121 months of incarceration; and NYSON JONES was previously sentenced to 87 months of incarceration. MORRIS SUMMERS, age 25, will be sentenced on December 16, 2015. Three defendants were convicted following trial and pending sentencing as well: DELOYD JONES, a/k/a “Puggy,” age 23; BYRON JONES, a/k/a/ “Big Baby,” age 25; and SIDNEY PATTERSON, a/k/a “Duda Man,” age 24.
According to court documents and evidence presented at trial, the defendants were members and associates of the “Ride or Die” gang, which they also referred to as “R.O.D.” The Ride or Die gang was initially formed in or about 2007 and continued to exist through in or about 2013. During the course of the federal investigation into the gang, agents learned that the defendants used a house, located at 1632 Mandeville Street, among other locations, as a base of operations to package, sell, and store narcotics, as well as store firearms.
U.S. Attorney Polite praised the work of the Bureau of Alcohol, Tobacco, Firearms and Explosives as part of the metro area’s Multi-Agency Gang Unit (MAG) in investigating this matter. As an integral component of NOLA FOR LIFE’s Group Violence Reduction Strategy, the
MAG Unit consists of a partnership with New Orleans Police Department (NOPD); Orleans Parish District Attorney’s Office (DA); Orleans Parish Sheriff’s Office (OPSO); Louisiana State Police (LSP); Parole Board of the Louisiana Department of Corrections; United States Attorney’s Office (USAO); Federal Bureau of Investigation (FBI); Drug Enforcement Administration (DEA); United States Marshal’s Service (USMS); and the United States Probation & Parole Office for the Eastern District of Louisiana. Assistant United States Attorneys Nolan D. Paige, Marquest Meeks and Special Assistant United States Attorney Brian Ebarb were in charge of the prosecution.
R.I. U.S. Attorney’s Office Collects More Than $6 Million in Civil and Criminal Actions for U.S. Taxpayers in Fiscal Year 2015Read the Press Release
PROVIDENCE - U.S. Attorney Peter F. Neronha announced today that the United States Attorney’s Office for the District of Rhode Island collected $6,130,353.07 in criminal and civil actions in Fiscal Year 2015. Of this amount, $2,626,122.75 was collected in criminal actions and $3,504,230.32 was collected in civil actions.
Additionally, Rhode Island worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $16,878,661.95 in cases pursued jointly with these offices. Of this amount $16,878,401.95 was collected in civil actions.
Attorney General Loretta E. Lynch announced today that the Justice Department collected $23.1 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2015. The more than $23.1 billion in collections in FY 2015 represents more than seven and a half times the approximately $2.93 billion of the Justice Department’s combined appropriations for the 93 U.S. Attorneys’ offices and the main litigating divisions in that same period.
“The Department of Justice is committed to upholding the rule of law, safeguarding taxpayer resources, and protecting the American people from exploitation and abuse,” said Attorney General Loretta Lynch. “The collections we are announcing today demonstrate not only the strength of that commitment, but also the significant return on public investment that our actions deliver. I want to thank the prosecutors and trial attorneys who made this achievement possible, and to reiterate our dedication to this ongoing work.”
United States Attorney Peter Neronha commented, “The mission of this Office is broad in scope, and includes a commitment to protect the public’s financial and other resources. Public or private, those who harm the environment, engage in financial fraud, or take financial advantage of victims or the public generally, will continue to receive the full attention of both this Office’s Civil and Criminal Divisions, as will those who pose a threat to national security, who violate the public trust, who commit crimes of violence, or who engage in sex trafficking, particularly of minors.”
In 2015, collections included $2,605,661 from American Access Care in settlement to resolve allegations of violations of the False Claims Act; $8,000,000 collected in cooperation with the Eastern District of Wisconsin from PharMerica Corporation in settlement of allegations of violations on the Controlled Substances Act; collection of $450,000 from CVS Health in settlement for allegations of violations of the Controlled Substances Act; and, $127,500 from Wal-Mart, Inc. in settlement of False Claims Act violations for claims submitted to Medicaid.
The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.
The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety or environmental laws. In addition, civil debts were collected on behalf of several federal agencies such as the Internal Revenue Service and Health and Human Services.
Additionally, the U.S. Attorney’s Office in Rhode Island, working with partner agencies and divisions, collected $8,261,533 in asset forfeiture actions in FY 2015. Forfeited assets deposited into the Department of Justice Assets Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes.
In the District of Rhode Island, the Financial Litigation Unit, working closely with the Asset Forfeiture Unit, collected a total of $2,389,896.28 through its Asset Forfeiture Restoration Program. Included in the above amount is $2,339,210.22 that the District collected from Rocco DeSimone, a former Rhode Island art dealer convicted of defrauding investors. DeSimone was sentenced to 16 years in prison in July 2011, on eight counts of money laundering and mail fraud. The assets that were either sold or returned directly to victims include a 2006 Ford GT sports car which sold at auction for $189,000, a painting by French impressionist Pierre-Auguste Renoir known as "Paysage a Cagnes," which sold at auction for $551,500, and an assortment of Japanese swords.
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Contact:
Jim Martin (401) 709-5357
email: [email protected]
on Twitter @USAO_RI
Psychiatrist and Counselor Indicted for Falsifying Medical Reports to Help Applicants for U.S. Citizenship Bypass Testing RequirementsRead the Press Release
CHICAGO — A psychiatrist and counselor in a Chicago medical practice were arrested today on charges they falsely diagnosed individuals as disabled in order to help them bypass certain tests for U.S. citizenship.
Dr. MAREK WALCZYK and KATARZYNA FERGEMANN fraudulently declared the applicants as suffering from a physical or mental impairment that purportedly rendered them unable to demonstrate the required knowledge of United States history and the English language, according to an indictment returned last month in U.S. District Court in Chicago. A medical certification of impairment allows individuals to seek an exemption from the civics and English-language tests required for naturalized U.S. citizenship.
Federal authorities arrested Walczyk and Fergemann this morning. During an arraignment later in the morning before U.S. Magistrate Judge Maria Valdez, Walczyk and Fergemann pleaded not guilty and were released on $15,000 unsecured appearance bonds. A status hearing was scheduled for Jan. 7, 2016, at 9:45 a.m., before U.S. District Judge Andrea R. Wood.
Walczyk, 59, of Norridge, and Fergemann, 38, of Chicago, are each charged with one count of conspiracy to defraud the United States, and two counts of attempted unlawful procurement of citizenship or naturalization. The conspiracy count is punishable by a maximum sentence of five years in prison, while the attempted unlawful procurement counts each carry a maximum sentence of ten years.
Walczyk is a licensed psychiatrist who operates a medical practice on the Northwest Side of Chicago. Fergemann is employed by the practice as a licensed counselor. According to the indictment, Fergemann prepared a written report stating that she administered diagnostic testing procedures on an individual seeking to apply for U.S. citizenship, and that the tests revealed the individual suffered from a social anxiety disorder, panic disorder and major depressive disorder, as well as a learning impairment resulting from those conditions. Fergemann issued the report knowing that the individual did not suffer from a physical or mental impairment, the indictment states.
Walczyk fraudulently certified Fergemann’s results as true and correct in U.S. Citizenship and Immigration Services Form N-648, titled “Medical Certification for Disability Exceptions,” the indictment states. The false certification allowed the individual to request a physical or mental impairment exception to the civics and English-language tests required for U.S. citizenship, according to the indictment.
The indictment was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; James Gibbons, Acting Special Agent-in-Charge of the Chicago Office of the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); and Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.
The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
The government is represented by Assistant United States Attorney Philip Fluhr.
Indictment
Pittsburgh-area Man Sentenced to 90 Months in Prison for Violating Federal Firearms LawsRead the Press Release
PITTSBURGH – A resident of Baldwin Borough, Pa., has been sentenced in federal court to 90 months imprisonment and three years supervised release on his conviction of violating federal firearms laws, United States Attorney David J. Hickton announced today.
United States District Judge Mark R. Hornak imposed the sentence on Eric Charles Smith, 38.
According to information presented to the court, on or about July 27, 2014, officers of the Baldwin Borough Police Department arrested Eric Smith at his residence in Baldwin for domestic violence assault against his girlfriend and their five-year-old child. Two days later, while Smith was still in jail on that charge, officers were called out to Smith’s residence by Smith’s girlfriend who indicated that she had obtained a Protection from Abuse Order against Smith and wanted his items removed from the residence, thereby giving officers consent to enter and seize items. Upon their entry, officers observed approximately 20 improvised explosive devices, explosive precursor chemicals, written calculations and recipes for explosives, bombmaking literature (such as the Anarchist Cookbook), remote detonating devices and various white supremacist and Nazi paraphernalia, including a podium and business cards which seemed to indicate that his residence was the meeting location for a group known as the “White Church Supremacists.” Among the devices was a six-inch-long fused cylinder device, which has been determined by the ATF to contain a perchlorate-based powder explosive containing aluminum and potassium perchlorate, as well as nails and other fragmentation taped to the outside of the cylinder. This device has been determined to be in operable condition and to fall within the legal definition of a “destructive device” by the ATF. In addition to being a convicted felon who is prohibited from possessing such a weapon, Smith has no items registered to him in the National Firearms Registration and Transfer Record.
Assistant United States Attorney James T. Kitchen prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Federal Bureau of Investigation and the Bureau of Alcohol, Tobacco, Firearms and Explosives for the investigation leading to the successful prosecution of Smith.
Pair from Galion charged for armed robbery in Ontario, OhioRead the Press Release
Stephen D. Anthony, Special Agent in Charge of the FBI, Cleveland Division, Northern District of Ohio, and Steven Dettelbach, United States Attorney for the Northern District of Ohio announce the arrest of Taylor Crisman and Chris Hill for the hostage-style armed robbery of KeyBank in Ontario, Ohio in early November.
On November 5, 2015, an unknown suspect held a KeyBank employee and his family hostage at gunpoint overnight in their home. On the morning of November 6, 2015, the suspect ordered the bank employee to travel to the bank, remove a large sum of money from the vault and return home. The suspect held the bank employee's wife and small children hostage until the employee returned home with the money. The bank employee complied with the demand. The suspect then notified an accomplice to pick him up from the residence.
A composite sketch of the unknown suspect was released to the public via the media on November 23, 2015. Various tips were received. Based on the composite sketch being shown by various media outlets, on November 28, 2015, a tip was provided indicating knowledge of the person that committed the KeyBank robbery. Investigators worked with the tipster to corroborate the information obtained over the next several days.
At approximately 12pm today agents from the Cleveland Division of the FBI, Mansfield and Canton resident offices, along with officers from the Ontario Police Department and Richland County Sheriff's Office conducted a traffic stop in Galion, Ohio and placed Crisman, 18, and Hill, 23, both of Galion, Ohio, into custody.
"The FBI commends the media and the public for helping to identify the individual who terrorized a KeyBank employee and his young family overnight," said SAC Anthony. "Crisman and Hill underestimated the collaborative efforts of law enforcement and the community."
"The one thing that these violent criminals did not count on was the incredible work of the FBI, the Ontario Police Department and the Richland County Sheriff's Office," said Dettelbach. "Now they will pay the price at the bar of justice for that oversight."
Crisman was placed into federal custody based on a federal arrest warrant obtained this week. Crisman was transported to Akron, Ohio this afternoon. Hill is currently being held on probable cause charges in the Richland County jail and will be federally charged tomorrow.
Evidence has been obtained at various locations where these two individuals have recently resided. Some items of evidence recovered include the fedora hat and bandana believed to be worn by Crisman during the time he held the family hostage in their home. Also, the .38 caliber handgun believed to be used by Crisman has been recovered.
Investigative activity continues to occur. Additional information will be released when appropriate.
A complaint is only a charge and is not evidence of guilt. The defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Any questions regarding this news release can be directed to SA Vicki D Anderson at the Cleveland Office of the FBI, 216-522-1400 or [email protected].
Owner of Arkansas Juvenile Mental Health Facilities Indicted on Bribery ChargesRead the Press Release
The owner of two Arkansas mental health companies that provide inpatient and outpatient mental health services to juveniles was indicted yesterday for engaging in a scheme to bribe a former deputy director of the Arkansas Department of Human Services (ADHS), announced Assistant Attorney General Leslie R. Caldwell of the Department of Justice’s Criminal Division.
A federal grand jury in the Eastern District of Arkansas returned the six-count indictment on Dec. 2, 2015, charging Theodore E. Suhl, 50, of Warm Springs, Arkansas, with conspiracy to commit bribery and honest services fraud, three counts of honest services fraud, one count federal funds bribery and one count of interstate travel in aid of bribery.
The indictment alleges that Suhl bribed Steven B. Jones, former deputy director of ADHS, to perform acts in his official capacity that benefitted Suhl and his mental health companies and to provide internal ADHS information to Suhl. Beginning in approximately April 2007, Suhl, Jones and Phillip W. Carter, a former probation officer in Crittenden County, Arkansas, and a West Memphis, Tennessee, councilmember, allegedly periodically met at restaurants in Memphis, Tennessee, and rural Arkansas in order for Suhl to request assistance from Jones. In exchange for Jones’ agreement to perform official acts, Suhl allegedly paid Jones by issuing checks made payable to the pastor of Carter’s church that Carter and the pastor then deposited and cashed in order to provide cash payments to Jones.
Jones previously pleaded guilty to federal funds bribery and conspiracy for his involvement in the scheme. Carter previously pleaded guilty to conspiracy to commit federal funds bribery and honest services wire fraud. Jones and Carter currently await sentencing.
The charges and allegations contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Trial Attorneys Lauren Bell, John D. Keller and Amanda R. Vaughn of the Criminal Division’s Public Integrity Section are prosecuting the case. The FBI’s Little Rock Field Office investigated the case.
Owner of Arkansas Juvenile Mental Health Facilities Indicted on Bribery ChargesRead the Press Release
WASHINGTON—The owner of two Arkansas mental health companies that provide inpatient and outpatient mental health services to juveniles was indicted yesterday for engaging in a scheme to bribe a former deputy director of the Arkansas Department of Human Services (ADHS), announced Assistant Attorney General Leslie R. Caldwell of the Department of Justice’s Criminal Division.
A federal grand jury in the Eastern District of Arkansas returned the six-count indictment on Dec. 2, 2015, charging Theodore E. Suhl, 50, of Warm Springs, Arkansas, with conspiracy to commit bribery and honest services fraud, three counts of honest services fraud, one count federal funds bribery and one count of interstate travel in aid of bribery.
The indictment alleges that Suhl bribed Steven B. Jones, former deputy director of ADHS, to perform acts in his official capacity that benefitted Suhl and his mental health companies and to provide internal ADHS information to Suhl. Beginning in approximately April 2007, Suhl, Jones and Phillip W. Carter, a former probation officer in Crittenden County, Arkansas, and a West Memphis, Tennessee, councilmember, allegedly periodically met at restaurants in Memphis, Tennessee, and rural Arkansas in order for Suhl to request assistance from Jones. In exchange for Jones’ agreement to perform official acts, Suhl allegedly paid Jones by issuing checks made payable to the pastor of Carter’s church that Carter and the pastor then deposited and cashed in order to provide cash payments to Jones.
Jones previously pleaded guilty to federal funds bribery and conspiracy for his involvement in the scheme. Carter previously pleaded guilty to conspiracy to commit federal funds bribery and honest services wire fraud. Jones and Carter currently await sentencing.
The charges and allegations contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Trial attorneys Lauren Bell, John D. Keller and Amanda R. Vaughn of the Criminal Division’s Public Integrity Section are prosecuting the case. The FBI’s Little Rock Field Office investigated the case.
Opelousas couple pleads guilty to identity theftRead the Press Release
LAFAYETTE, La. – United States Attorney Stephanie A. Finley announced that an employee of an Opelousas tax preparation business and her boyfriend pleaded guilty Wednesday to stealing customers’ identities in order to pocket income tax refunds.
Frances Owens, 36, and Kevin White, 33, both of Washington, La., pleaded guilty before U.S. District Judge Richard T. Haik to one count of identity theft. According to the guilty plea, Owens worked as a tax preparer at Dee’s Tax Service in Opelousas in 2013. While working at Dee’s Tax Service, Owens prepared false 2012 individual tax returns for at least two people that had not authorized her to do so. While preparing the false tax returns, Owens took steps to ensure that the victims’ tax refund checks were sent to Dee’s Tax Service instead of the victims’ residences. Owens and her boyfriend, White, then took possession of the checks, forged the victims’ signatures and obtained false identification cards in the names of the victims to cash the checks. Specifically, on April 10, 2013, Owens illegally used a false identification card with her picture on it to cash a $5,838 check, and on April 12, 2013, White used a false identification card with his picture on it to cash a $4,727 check.
The defendants face up to 15 years in prison, three years of supervised release, a $250,000 fine and restitution.
The IRS investigated the case. Assistant U.S. Attorney David C. Joseph is prosecuting the case.
Northern District of Texas U.S. Attorney's Office Collects Nearly $17 Million in Civil and Criminal Actions for U.S. Taxpayers in Fiscal Year 2015Read the Press Release
DALLAS — U.S. Attorney John Parker announced today that the Northern District of Texas collected $16,843,994 in criminal and civil actions in the fiscal year (FY) ending Sept. 30, 2015. Of this amount, $13,517,578 was collected in criminal actions and $3,326,415 was collected in civil actions.
Additionally, the Northern District of Texas worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $577,658 in cases pursued jointly with these offices. Of this amount, $152,634 was collected in criminal actions and $425,024 was collected in civil actions.
Attorney General Loretta E. Lynch also announced today that the Justice Department collected $23.1 billion in civil and criminal actions in FY 2015. The more than $23.1 billion in collections in FY 2015 represents more than seven and a half times the approximately $2.93 billion of the Justice Department’s combined appropriations for the 94 U.S. Attorneys’ offices and the main litigating divisions in that same period.
“The Department of Justice is committed to upholding the rule of law, safeguarding taxpayer resources, and protecting the American people from exploitation and abuse,” said Attorney General Lynch. “The collections we are announcing today demonstrate not only the strength of that commitment, but also the significant return on public investment that our actions deliver. I want to thank the prosecutors and trial attorneys who made this achievement possible, and to reiterate our dedication to this ongoing work.”
“These numbers illustrate that this office’s vigorous prosecutions, criminal and civil, do not end at sentencing or judgment, said U.S. Attorney Parker. “We have a continuing obligation to aggressively pursue the recovery of ill-gotten funds for both victims of crime and the federal treasury, and our efforts in this regard will remain robust.”
Substantial collections in the District in FY 2015 included:
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$1.77 million, almost 75% of the total funds embezzled by defendant returned to his former employer within 60 days of sentencing in U.S. v. Daniel Mangini;
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$1.54 million recovered through garnishment of multiple retirement accounts, life insurance policies, and payoff of lien on homestead in U.S. v. Michael Wolf, a workers’ compensation health care fraud case;
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$780,000 collected through the garnishment of multiple bank accounts, lease payments, and lawsuit settlement proceeds to enforce a $1.7 million civil judgment the U.S. Department of Labor obtained against the defendants on behalf of dozens of disabled men forced to work for years under deplorable conditions in U.S. v. Kenneth Henry and Hill Country Farms;
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$605,000 recovered through foreclosure of liens on real property and garnishment of multiple accounts in U.S. v. Glen McDonald, a counterfeiting and trafficking in contraband case;
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$383,000 in payments toward a $705,000 civil consent judgment in U.S. v. Wilma Aguilera, a False Claims Act case regarding a contract with the Department of Defense; and
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$226,000 recovered through foreclosure of lien on homestead to satisfy restitution imposed against husband and wife in U.S. v. Kenneth and Leah Brown, an insurance fraud conspiracy
The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.
The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education.
Additionally, the U.S. Attorney’s office in the Northern District of Texas, working with partner agencies and divisions, collected $12,544,766 in asset forfeiture actions in FY 2015. Forfeited assets deposited into the Department of Justice Assets Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes.
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North Carolina Man Sentenced for Possession of Stolen FirearmsRead the Press Release
NORFOLK, Va. – Robert James Gibson, 25, of Roxobel, North Carolina, was sentenced today to 72 months in prison for possession of stolen firearms. Gibson was ordered to pay $15,000 in restitution for the cost of the stolen firearms and the damage done to AWH Arms during the course of the burglary.
Gibson pleaded guilty on Sept. 3, 2015. According to court documents, Gibson and a co-conspirator broke into AWH Arms in Virginia Beach and stole 22 firearms which Gibson and the co-conspirator were selling to people on the streets. This case came to light when a drunken individual left a night club and started shooting a gun into the air. After responding to a call about the shooting, police recovered the firearm and discovered it was stolen from the break-in at AWH Arms. The drunken individual identified both Gibson and the co-conspirator who sold him the stolen firearm.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Charles E. Smith, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division, made the announcement after sentencing by U.S. District Judge Mark S. Davis. Assistant U.S. Attorney William D. Muhr prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:15-cr-69.
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North Andover Psychiatrist Settles Drug Diversion AllegationsRead the Press Release
BOSTON – The U.S. Attorney’s Office reached a $20,000 civil settlement today with Dr. Richard Heller, a psychiatrist in North Andover, Mass., in connection with his uncontrolled storage of patient medication in a self-storage unit and his related failure to maintain proper records.
In settlement documents, Dr. Heller admitted to failing to maintain readily retrievable records of controlled substances, failing to conduct required biennial inventories, and failing to maintain complete and accurate records of controlled substances at his office and self-storage unit. An investigation revealed that Dr. Heller was improperly taking back unused medications from his patients, leaving those medications in various unsecured locations within his office, and failing to keep records of those medications, as required by regulations. In addition, investigators learned in May 2015 that Dr. Heller had been maintaining a substantial amount of unused medications for which he did not have accurate records in a North Andover self-storage unit. That storage unit was not registered with the Drug Enforcement Administration (DEA), and the contents of the unit were subject to possible auction as a result of Dr. Heller’s failure to make timely rental payments.
“Ensuring the proper handling of prescription drugs is a critical part of our ongoing efforts to protect patient safety and prevent drug diversion,” said United States Attorney Carmen M. Ortiz. “We will continue to monitor those handling controlled substances, whether they are large pharmacy chains or solo physician practices, to insist that they adhere to these regulations in conducting business.”
“DEA registrants are responsible to handle controlled substances and ensure that complete and accurate records are being properly kept and accounted for in compliance with the Controlled Substance Act,” said Special Agent in Charge Michael J. Ferguson. “Our obligation is to improve public safety and public health, and we are committed to working with our law enforcement and regulatory partners to ensure that these rules and regulations are followed.
“The North Andover Police Department aggressively investigates all reports of potential drug diversion that could result in the misuse and abuse of pharmaceuticals,” said Chief Paul J. Gallagher of the North Andover Police Department. “To that end, we will continue to work with our federal, state, local and community partners to help mitigate the severe negative consequences of drug abuse and addiction present in Massachusetts and throughout the Northeast.”
Dr. Heller has agreed to pay $20,000 to settle these claims and to permit the DEA to perform four administrative inspections of his office over the course of the next two years without a warrant.
U.S. Attorney Ortiz, DEA SAC Ferguson and Chief Paul J. Gallagher of the North Andover Police Department, made the announcement today. The case was handled by Assistant U.S. Attorney Patrick Callahan.
North Alabama U.S. Attorney’s Office Collects $2.4 million in Civil and Criminal Actions for U.S. Taxpayers in Fiscal Year 2015Read the Press Release
BIRMINGHAM -- U.S. Attorney Joyce White Vance announced today that the Northern District of Alabama office collected $2.4 million in criminal and civil actions in Fiscal Year 2015. Of this amount, $1.9 million was collected in criminal actions and $483,146 in civil actions.
Additionally, the north Alabama office worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $36.7 million in cases pursued jointly with these offices. Those joint cases included a $13 million settlement with the for-profit education company, Education Affiliates, on allegations of fraud against the U.S. Department of Education.
Attorney General Loretta E. Lynch announced today that the Justice Department collected $23.1 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2015. That amount represents more than seven and a half times the approximately $2.93 billion that the Justice Department appropriated for the 93 U.S. Attorneys’ offices and the main litigating divisions for the 2015 fiscal year.
“The Department of Justice is committed to upholding the rule of law, safeguarding taxpayer resources and protecting the American people from exploitation and abuse,” said Attorney General Lynch. “The collections we are announcing today demonstrate not only the strength of that commitment, but also the significant return on public investment that our actions deliver. I want to thank the prosecutors and trial attorneys who made this achievement possible, and to reiterate our dedication to this ongoing work.”
"My office is committed to the primary goal of seeking justice and, to that end, we work every day to put criminals behind bars and ensure that money taken through wrongful action is returned to the federal government and the American taxpayer,” Vance said. “The $2.4 million our office recovered independently this past year, plus the $36.7 million we recovered working collaboratively with other offices, is more than three times the budget of this office," she said.
Among the civil collections made independently by the U.S. Attorney’s Office for north Alabama was $123,036 from Maurice Gant and the Center for Hearing in Huntsville, and $300,000 from Generics Bidco, a Huntsville pharmaceutical distribution facility. The Center for Hearing paid to settle allegations that it made a series of false claims to the government arising from the provision of audiology services to TVA employees and retirees. Generics Bidco paid penalties to settle allegations that it failed to maintain complete and accurate records and inventories of controlled substances.
The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.
The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education.
Additionally, the U.S. Attorney’s office for the Northern District of Alabama, working with partner agencies and divisions, collected $1.4 million in asset forfeiture actions in FY 2015. Forfeited assets deposited into the Department of Justice Assets Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes.
New York Plastic Surgeon to Pay $150,000 to Settle Allegations under the Controlled Substances ActRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that CHERYL KARCHER, M.D., 57, of Brookfield, Conn., and New York, N.Y., has entered into a civil settlement agreement with the government in which she will pay $150,000 to resolve allegations that she violated civil provisions of the Controlled Substances Act.
KARCHER is a plastic surgeon associated with Sadick Dermatology located at 911 Park Avenue in Manhattan. The allegations against her involve claims that she wrote at least 15 prescriptions for Percocet, a Schedule II Narcotic drug, outside the course of her normal medical practice. The 15 prescriptions, which were filled at pharmacies in Connecticut, were not dispensed to the individuals whose name was on the prescriptions.
“The improper diversion of potent pharmaceuticals risks the safety of those individuals that ultimately use these drugs,” said U.S. Attorney Daly. “This settlement sends a message to the medical community that there are real consequences for practicing medicine outside the proper course of medical practice.”
KARCHER was prosecuted by the Office of the Special Narcotics Prosecutor for the City of New York in a related criminal case. The case against her was dismissed after she completed a court-ordered drug treatment program.
The federal investigation was conducted by investigators from the Drug Enforcement Administration’s Office of Diversion Control in Rocky Hill, Conn. The prosecution was led by Assistant U.S. Attorney Alan M. Soloway.
New York Man Sentenced to 60 Month Federal Prison Term for Cocaine DistributionRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Wesley Jackson, age 52, New York, NY was sentenced to 60 months by Chief United States District Court Judge Christopher C. Conner in Harrisburg, for unlawful distribution of cocaine.
According to United States Attorney Peter Smith, Jackson pled guilty in August 2015 to unlawfully distributing approximately a half of kilogram of cocaine from September to November 2014.
Jackson was indicted by a federal grand jury in December 2015, as a result of an investigation by the Drug Enforcement Administration’s Harrisburg Resident Office and the Harrisburg Police Department. Prosecution of the case was assigned to Assistant United States Attorney William A. Behe.
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New Mexico U.S. Attorney’s Office Collects More Than $12 Million in Civil and Criminal Actions for U.S. Taxpayers in Fiscal Year 2015Read the Press Release
ALBUQUERQUE – U.S. Attorney Damon P. Martinez announced today that the District of New Mexico collected $12,080,100.80 in criminal and civil actions in Fiscal Year 2015. Of this amount, $2,489,785.93 was collected in criminal actions and $9,590,314.87 was collected in civil actions.
Additionally, the Office worked with other components of the Justice Department to collect an additional $78,200,000.00 in civil cases pursued jointly. The Office, working with partner agencies and divisions, also collected $2,039,813.00 in asset forfeiture actions.
Attorney General Loretta E. Lynch announced that the Justice Department collected $23.1 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2015. The more than $23.1 billion in collections in Fiscal Year 2015 represents more than seven and a half times the approximately $2.93 billion of the Justice Department’s combined appropriations for the 94 U.S. Attorneys’ Offices and the main litigating divisions in that same period.
“The Department of Justice is committed to upholding the rule of law, safeguarding taxpayer resources, and protecting the American people from exploitation and abuse,” said Attorney General Loretta Lynch. “The collections we are announcing today demonstrate not only the strength of that commitment, but also the significant return on public investment that our actions deliver. I want to thank the prosecutors and trial attorneys who made this achievement possible, and to reiterate our dedication to this ongoing work.”
“The U.S. Attorney’s Office is dedicated to protecting the public by recovering funds wrongfully taken from the taxpayers and obtaining restitution for victims of federal crimes,” said U.S. Attorney Damon P. Martinez. “By holding accountable those who defraud the taxpayers and criminals who seek to profit from their illegal activities, we seek not only to ensure that justice is served but also deliver a valuable return to the people of New Mexico.”
U.S. Attorney Martinez commended Assistant U.S. Attorneys Howard R. Thomas, Ruth F. Keegan, Stephen R. Kotz and Brock Taylor and staff members Julie Chappell, Lois Agnes, Feather Astor, Lois Golden, Melinda Quick and Roxanne Castillo for their combined efforts in recovering funds on behalf of the United States. He also commended U.S. Marshal Conrad E. Candelaria and the U.S. Marshals Service for facilitating the collection of funds from the criminal and civil forfeiture actions.
The U.S. Attorneys’ Offices, along with the Justice Department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the United States and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid to the victim, criminal fines and felony assessments are paid to the Department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.
The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government moneys lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education. Forfeited assets deposited into the Department of Justice Asset Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes.
New London Man Pleads Guilty to Federal Gun ChargeRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that ELIJAH GRIFFIN, 25, of New London, pleaded guilty yesterday in Hartford federal court to being a felon in possession of firearms.
According to court documents and statements made in court, on April 30, 2015, members of the New London Police Department and the Connecticut State Police executed a state search and seizure warrant at GRIFFIN’s apartment on West Street in New London. Inside a closet in GRIFFIN’s room, officers located and seized a loaded .38 caliber revolver and a loaded .45 caliber pistol.
GRIFFIN has a prior state felony conviction for sale of narcotics. It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.
GRIFFIN has been detained since his arrest on April 30. He is scheduled to be sentenced by Senior U.S. District Judge Alfred V. Covello on February 24, 2016, at which time he faces a maximum term of imprisonment of 10 years.
This matter is being investigated by the New London Police Department with the assistance of the Connecticut State Police and the Norwich Police Department. The case is being prosecuted by Assistant U.S. Attorney Sarah P. Karwan.
New Hampshire Company Pleads Guilty to Hacking into A Competitor’s Computer System for Commercial AdvantageRead the Press Release
CONCORD, N.H. – Acting United States Attorney Donald Feith, and FBI Special Agent in Charge, Harold H. Shaw, announced today that General Linen Services, LLC of Somersworth, New Hampshire, formerly known as General Linen Service Co., Inc. (General Linen Somersworth) pled guilty to violating computer hacking in violation of Title 18, United States Code, Sections 1030(a)(2)(C) & (c)(2)(B)(i). Earlier this month, charges were filed alleging that between September 2009 and April 8, 2010 the company “intentionally accesses a computer without authorization, and thereby obtained information from a protected computer,” a computer used in interstate commerce, “and the offense was committed for purposes of commercial advantage and private financial gain … .”
Today General Linen Somersworth appeared before United States District Judge Steven J. McAuliffe and entered a guilty plea on the company’s behalf. The facts to which the company has agreed in its plea include that in September 2009 its former information technology (IT) director, accessed, without authority, the computer server of a competitor with a similar name, General Linen Services Co. Inc. of Newburyport, Massachusetts. The IT director then shared the login information with others at the company, who then repeatedly accessed the competitor’s computer system, downloading approximately 1,100 of their competitor’s invoices for use in sales efforts directed at the competitor’s customers. The FBI’s examination of the victim’s computer system proved that between September 2009 and April 8, 2010 there were 157 instances of unauthorized access to the victim company’s computer system and that the majority of those intrusions originated at the office of the defendant, General Linen Somersworth.
“Small businesses often rely on relatively small profit margins in their day-to-day business,” stated Acting United States Attorney Donald Feith. “These tight profit margins can be harmed, and the survival of a small business can be compromised, when competitors engage in criminal activity to gain a marketing advantage. This case demonstrates that a relatively small New Hampshire company hacked into the computer system of one of its competitors and stole over 1,000 invoices in an effort to steal customers from its competitor. This case should stand as an example to all business in New Hampshire that the FBI and the U.S. Attorney’s Office do not limit their investigations of computer hacking to Fortune 500 companies. All businesses are entitled to the safe and secure use of their computers and the Internet, and when hacking is suspected investigations and prosecutions will take place.”
The defendant is scheduled to be sentenced on March 26, 2016 and faces a maximum sentence of five years’ probation, up to a $500,000 fine, and may be ordered to pay restitution to the victim of its crime, General Linen Newburyport.
This case was investigated by the Federal Bureau of Investigation, Boston Field Office, and is being prosecuted by Assistant United States Attorney Arnold H. Huftalen.
New Charges Brought against Tobacco WholesalerRead the Press Release
BOSTON – Additional charges were handed down yesterday by a federal grand jury in Springfield against a Middletown, Conn. man in connection with his scheme to defraud Massachusetts and Connecticut of substantial tobacco tax revenue.
Syed I. Bokhari, 51, was charged in a 35-count superseding indictment with one count of racketeering conspiracy, 10 counts of wire fraud, five counts of trafficking in contraband smokeless tobacco, one count of conspiracy to commit money laundering, nine counts of concealment money laundering, five counts of money laundering and five counts of violation of the Prevent All Cigarette Trafficking (PACT) Act. Bokhari was initially charged in a 32-count indictment in October 2014.
The superseding indictment alleges that Bokhari was the head of a sprawling enterprise which included tobacco wholesale businesses, gas stations and convenience stores, real estate, and hotels in Massachusetts, Connecticut and Pennsylvania. Between 2000 and 2012, Bokhari allegedly defrauded Massachusetts and Connecticut by failing to pay excise taxes on smokeless tobacco and cigars. It is alleged that he transferred smokeless tobacco to those states without reporting them to the appropriate state tax authorities, as required under the PACT Act. The superseding indictment also alleges that Bokhari accepted payments for tobacco products in cash amounts of more than $10,000, yet did not file the required federal financial reporting form. He did this to disguise the true volume of the tobacco products being sent to Massachusetts and Connecticut and the source of the cash payments. Bokhari also allegedly provided fake invoices and caused the filing of false excise tax returns to the Massachusetts and Connecticut tax authorities. Lastly, Bokhari allegedly used his non-tobacco businesses to launder the proceeds of the tobacco tax fraud.
The charges of racketeering conspiracy and wire fraud provide for a sentence of no greater than 20 years in prison, three years of supervised release and a fine of $250,000 or twice the gross gain or loss for each count. The change of trafficking in contraband smokeless tobacco provides for a sentence of no greater than five years in prison, three years of supervised release and a fine of $250,000 or twice the gross gain or loss for each count. The charge of conspiracy to commit money laundering provides for a sentence of no greater than 10 years in prison, three years of supervised release and a fine of $250,000 or twice the value of the property involved in the transaction for each count. The charge of concealment money laundering provides for a sentence of no greater than 20 years in prison, three years of supervised release and a fine of $500,000 or twice the value of the property involved in the transaction for each count. The charge of money laundering provides for a sentence of no greater than 10 years in prison, three years of supervised release and a fine of $250,000 or twice the gain or loss for each count. The charge of violation of the PACT Act provides for a sentence of no greater no three years in prison, one year of supervised release and a fine of $250,000 for each count. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based on the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz; Daniel J. Kumor, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms & Explosives, Boston Field Division; William P. Offord, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; Matthew Etre, Special Agent in Charge of Homeland Security Investigations in Boston; Commissioner Mark Nunnelly of the Massachusetts Department of Revenue; and Commissioner Kevin B. Sullivan of the Connecticut Department of Revenue Services, made the announcement today. The case is being prosecuted by Assistant U.S. Attorneys Alex J. Grant and Katharine Wagner of Ortiz’s Springfield Branch Office.
The details contained in the charging document are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Nevada U. S. Attorney’s Office Collects $22.5 Million for U.S. Taxpayers in 2015Read the Press Release
LAS VEGAS, Nev. – U.S. Attorney Daniel G. Bogden announced today that the Nevada U.S. Attorney’s Office collected approximately $22.5 million in Fiscal Year (FY) 2015 related to criminal, civil and asset forfeiture actions. Of this amount, approximately $5 million was collected in criminal actions, $2.5 million was collected in civil actions, and $15 million was collected in asset forfeiture actions in FY 2015.
The District of Nevada also worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $2.7 million in cases pursued jointly with these offices.
“Our office has been aggressive in enforcing and collecting civil and criminal debts owed to the United States and criminal debts owed to federal crime victims,” said U.S. Attorney Bogden. “These collections are used to help crime victims and for a variety of other law enforcement purposes,” said U.S. Attorney Bogden. “Our FY 2015 collections substantially exceeded the total appropriated budget for our office for the entire year.”
U.S. Attorney General Loretta E. Lynch also announced today that the Justice Department collected $23.1 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2015. The $23.1 billion in collections in FY 2015 represents more than seven and a half times the approximately $2.93 billion of the Justice Department’s combined appropriations for the 94 U.S. Attorneys’ offices and the main litigating divisions in that same period.
Below are summaries of two cases in which the U.S. Attorney’s Office for the District of Nevada collected significant amounts of money during FY 2015.
In December 2014, Concierge Compounding Pharmaceuticals (CCP) paid $273,500 to the U.S. Attorney’s Office for Nevada and the U.S. Department of Justice to settle claims on behalf of the Drug Enforcement Administration and the Defense Health Agency alleging that CCP had shipped compounded pharmaceuticals, many of them controlled substances, outside Nevada without being licensed as a pharmacy in the states where the drugs were received.
In FY 2015, we collected over $7.5 million from defendants Nathan Stoliar and James Jariv, who pleaded guilty in 2015 to conspiracy to defraud the United States, money laundering, and wire fraud, and were sentenced to prison. The money was collected through the seizure and criminal forfeiture of assets, such as bank accounts, jewelry, and real property, which were the proceeds of their complex fraud scheme involving renewable energy credits.
The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs. Forfeited assets deposited into the Department of Justice Assets Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes.
The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education.
Nevada City Woman Sentenced to over Five Years in Prison for Marijuana Cultivation and Structuring Currency TransactionsRead the Press Release
SACRAMENTO, Calif. — Patricia Jane Albright, 64, of Nevada City, was sentenced by United States District Judge Troy L. Nunley to five years and five months in prison for conspiring to manufacture marijuana, manufacturing marijuana, and structuring currency transactions to evade federal reporting requirements, United States Attorney Benjamin B. Wagner announced.
On July 21, 2015, Albright pleaded guilty to the charges. Albright’s son and co‑conspirator, Jordan Wirtz, 29, previously pleaded guilty to possession of a firearm in furtherance of a drug trafficking crime, for possessing a loaded Northern England 12 gauge shotgun and ammunition in his residence at the grow site. On February 26, 2015, Judge Nunley sentenced him to five years in prison.
According to court documents, between 2008 and September 2010, Albright and others manufactured marijuana on two properties she owned near Nevada City and Georgetown. Marijuana from Albright’s operation was regularly shipped out of state under fake names and addresses. At the time of her arrest on September 28, 2010, investigators found marijuana plants, cash, processed marijuana, and two firearms.
When Albright purchased the property near Georgetown in 2008 for growing marijuana, she structured 21 cash transactions at six different financial institutions over three days so she could avoid federal reporting requirements related to cash deposits.
This case was the product of an investigation by the Internal Revenue Service, Criminal Investigation; the U.S. Drug Enforcement Administration; the California Department of Justice; the Grass Valley Police Department, and the sheriff’s offices of Nevada County, Placer County, and El Dorado County. Assistant United States Attorneys Michael M. Beckwith and Justin Lee prosecuted the case.
During the course of the investigation which involved the execution of 16 search warrants in three different counties, law enforcement seized over 4,100 marijuana plants, over 200 pounds of processed marijuana, and numerous firearms. A number of the defendants were armed at the time of their arrest, and several of the defendants had prior felony convictions for narcotics offenses. One defendant was arrested in a marijuana grow with a firearm while on pretrial release from an earlier arrest. He was facing charges for manufacturing marijuana in Southern California in 2009. Documents and items found at a number of the search locations show hundreds of thousands of dollars in financial transactions, and the interstate shipment of cash and narcotics.
Nampa Man Sentenced for Selling MethamphetamineRead the Press Release
BOISE – Richard Lobato, 51, of Nampa, Idaho, was sentenced today in United States District Court to 60 months for distributing methamphetamine, U.S. Attorney Wendy J. Olson announced. Chief U.S. District Judge B. Lynn Winmill also ordered Lobato to serve four years of supervised release following his prison term. Lobato was indicted by a federal grand jury on October 15, 2014, and entered a guilty plea on September 1, 2015.
According to the plea agreement, Lobato admitted that he distributed methamphetamine to a confidential informant on two occasions. On October 9, 2013, Lobato and co-conspirator Michael Bradshaw sold approximately one-quarter of an ounce of methamphetamine to the informant. On October 23, 2013, Lobato sold another one-quarter of an ounce of methamphetamine to the informant.
This case and other related cases are the result of an investigation by the Treasure Valley Metro Violent Crimes Task Force, which focused on the “Norteno” Northside gang that is active in Nampa and other parts of the Treasure Valley. Fourteen individuals were indicted on drug and gun charges as a result of the investigation. In addition to Lobato, nine other defendants have been sentenced. Guadalupe Serrano, 35, of Caldwell, was sentenced on April 21, 2015, to 75 months in prison for possession of methamphetamine with intent to distribute and for possessing firearms in furtherance of the drug trafficking crime. Nicole Danelle Nieto, 31, of Nampa, was sentenced on May 26, 2015, to 41 months in prison for distributing methamphetamine. Jose Manuel Menchaca, 35, of Nampa, was sentenced May 28, 2015, to 60 months in prison for distributing methamphetamine. On June 17, 2015, Brandi Larrea, 31, of Nampa, was sentenced to 48 months in prison for distributing methamphetamine and Tara Noelle Rivera, 30, of Nampa, was sentenced to 24 months in prison for distributing methamphetamine. Johnny Lee Martinez, 33, of Nampa, was sentenced on July 20, 2015, to 57 months in prison for distributing methamphetamine. Michael Bradshaw, 31, of Nampa, was sentenced on August 6, 2015, to 66 months in prison for distributing methamphetamine. Kenny P. Breedlove, 35, from California, was sentenced on October 15, 2015, to 110 months in prison. Guillermo Farias Jr., 29, from Nampa, was sentenced on October 26, 2015, to three years of supervised probation. Two other defendants, Jose Enrique Olvera Jr., 51, from Nampa, and Isaac Bright, 21 from Caldwell, are scheduled for sentencing on January 20, 2016. Veronica Cantu, 26, of Nampa, was arrested in Michigan last week and has an initial appearance scheduled for December 10, 2015. One defendant, Ruben Rodriguez, 36, of Nampa, has an outstanding warrant.
These cases are the result of a joint investigation by the Treasure Valley Metro Violent Crime Task Force and the Organized Crime and Drug Enforcement Task Force (OCDETF). The Treasure Valley Metro Violent Crime Task Force is comprised of federal, state and local agencies, including the Federal Bureau of Investigation; Bureau of Alcohol, Tobacco, Firearms and Explosives; Boise Police Department; Ada County Sheriff’s Office; Caldwell Police Department; Nampa Police Department; Meridian Police Department; Canyon County Sheriff’s Office; and Idaho Department of Probation and Parole. The Organized Crime and Drug Enforcement Task Force (OCDETF), includes the cooperative law enforcement efforts of the Federal Bureau of Investigation; Drug Enforcement Administration; Bureau of Alcohol, Tobacco, Firearms and Explosives; U. S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Internal Revenue Service-Criminal Investigation; and U.S. Marshals Service. The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations.
These cases are being prosecuted by the Special Assistant U.S. Attorney hired by the Treasure Valley Partnership, the Canyon County Prosecuting Attorney’s Office, and the State of Idaho to address gang crimes. The Treasure Valley Partnership is comprised of a group of elected officials in southwest Idaho dedicated to regional coordination, cooperation, and collaboration on creating coherent regional growth. For more information, visit treasurevalleypartners.org.
Michigan Woman Charged in Fraud SchemeRead the Press Release
PHILADELPHIA - Alyson Cesarz, 43, of Allen Park, Michigan, was charged by information, filed December 1, 2015, with five counts of wire fraud, announced United States Attorney Zane David Memeger. As the owner of Parklane Commercial Lending, Cesarz told clients that she would seek financing for their commercial projects in amounts ranging from fifteen million dollars to almost one billion dollars. She required the clients to pay a large, allegedly refundable deposit, of over $100,000, and for one client over $500,000. Cesarz did not obtain financing for the clients or return the refundable deposits. Four victims were defrauded of at least $1,148,000.
If convicted, the defendant faces a maximum possible sentence of 100 years of imprisonment, three years of supervised release, a fine, and a $500 special assessment.
The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Laurie Magid.
An information is an accusation. A defendant is presumed innocent unless and until proven guilty.
Mexican National Charged with Illegal Possession of a FirearmRead the Press Release
U.S. Attorney Kenneth A. Polite announced that ERIC de JESUS MENDOZA-MARTINEZ, age 19, from Honduras, was charged today in a one-count Indictment with being an illegal alien in possession of a firearm.
According to the Indictment, MENDOZA-MARTINEZ, an alien illegally and unlawfully present in the United States, was encountered by Department of Homeland Security/Homeland Security Investigations agents and found to be in possession of a .380 semi-automatic pistol.
If convicted, MENDOZA-MARTINEZ faces a maximum term of imprisonment of ten years, a fine of $250,000 and three years of supervised release following any term of imprisonment.
U. S. Attorney Polite reiterated that an Indictment is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
U.S. Attorney Polite praised the work of the U.S. Department of Homeland Security/Homeland Security Investigations in investigating this matter. Assistant U.S. Attorney Spiro G. Latsis is in charge of the prosecution.
McKinney Texas Man Pleads Guilty to Money Laundering ConspiracyRead the Press Release
MUSKOGEE, OKLAHOMA - The United States Attorney’s Office for the Eastern District of Oklahoma, announced today that NATHAN PHILLIP WEBSTER, age 40, of McKinney, Texas, pled guilty to MONEY LAUNDERING CONSPIRACY, in violation of Title 18, United States Code, Section 1956(h), punishable by not more than 20 years imprisonment, up to a $500,000 fine or both.
Charges arose from an investigation by the Drug Enforcement Administration. The defendant was indicted in April, 2015.
The Indictment alleged that beginning in or about August of 2011, the exact date being unknown and continuing until in or about January 2013, the defendant did willfully and knowingly combine, conspire, confederate, and agree together with others known and unknown, to knowingly conduct and attempt to conduct a financial transaction affecting interstate and foreign commerce, by purchasing a Green, 2001, Ford F150, truck, with proceeds from the distribution and sale of methamphetamine, with the intent to acquire, possess and distribute methamphetamine.
The charge further alleges that the defendant deposited large sums of United States Currency into bank accounts in Dallas, Texas, knowing that the transactions were designed in whole or in part to conceal and disguise the nature, location, source, ownership, and control of the proceeds from the distribution of methamphetamine.
The Honorable Kimberly E. West, Magistrate Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, accepted the guilty plea and ordered the completion of a presentence report. Sentencing will be scheduled following its completion. The defendant will remain in the custody of the United States Marshal Service pending sentencing.
Assistant United States Attorney Rob Wallace represented the United States.
Maryland U. S. Attorney’s Office Collects over $155 Million in Civil and Criminal Actions for U.S. Taxpayers in FY 2015Read the Press Release
Baltimore, Maryland – U.S. Attorney Rod J. Rosenstein announced that financial collections in criminal and civil actions in Fiscal Year (FY) 2015 in the District of Maryland reached $155,566,462.75. The U.S. Department of Justice keeps statistics on a fiscal year basis, closing the books each September 30.
Attorney General Loretta Lynch announced today that the Justice Department collected $23.1 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2015. The more than $23 billion in collections in FY 2015 represents nearly seven and a half times the appropriated $2.93 billion budget for the 94 U.S. Attorney’s offices and the main litigating divisions in that same period.
“The Department of Justice is committed to upholding the rule of law, safeguarding taxpayer resources, and protecting the American people from exploitation and abuse,” said Attorney General Loretta Lynch. “The collections we are announcing today demonstrate not only the strength of that commitment, but also the significant return on public investment that our actions deliver. I want to thank the prosecutors and trial attorneys who made this achievement possible, and to reiterate our dedication to this ongoing work.”
“Thanks to the hard work and dedication of employees of the U.S. Attorney’s Office and our partner agencies, funds recovered far exceed the cost of operating the office,” said Maryland U.S. Attorney Rod J. Rosenstein. “We will continue to hold accountable anyone who seeks to profit from illegal activities.”
According to statistics from the Department of Justice, the U.S. Attorney’s Office for the District of Maryland in FY 2015 collected $136,419,084.26 in criminal debts owed to the U.S. government and to federal crime victims, including restitution, criminal fines and felony assessments.
The statistics show that the $19,147,378.49 collected in civil actions in Maryland, include affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected penalties imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws, and debts collected on behalf of several federal agencies, including the U.S. Department of Education, Housing and Urban Development, Health and Human Services, Internal Revenue Service, and Small Business Administration.
Additionally, the District of Maryland worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $14,429,540.47 in cases pursued jointly with these offices. Of this amount $429,088.54 was collected in criminal actions and $14,000,451.93 was collected in civil actions, including cases resolved under the False Claims Act on behalf of victim agencies such as the Department of Health and Human Services, Department of Defense and the Department of Education. These cases include the successful resolution of United States ex rel. Roman v. Education Affiliates, Inc., United States ex rel Stoneham v. Pole Zero, Inc. and investigations of DRS Technical Services, Inc. and Foundation Health Services, Inc. Additionally, the District of Maryland collected civil penalties under the Controlled Substances Act on behalf of the Drug Enforcement Administration from its investigation of Value Drug, Inc.
The U.S. Attorneys’ offices, along with the Department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the United States and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid directly to the victim, criminal fines and felony assessments are paid to the Department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.
The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, labor and controlled substance laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education.
In addition, the U.S. Attorney’s Office for the District of Maryland, working with partner agencies and divisions, collected $16,708,177 in asset forfeiture actions in FY 2015. Forfeited assets deposited into the Department of Justice Assets Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes.
For more information, the Department’s Annual Statistical Reports on prior fiscal years can be found on the internet at: http://www.justice.gov/usao/reading_room/foiamanuals.html.
Man Sentenced to 5 Years’ Probation and Community Confinement for Aiming Laser at California Highway Patrol HelicopterRead the Press Release
OAKLAND – Christian Palomino was sentenced today to five years of probation, including 6 months of community confinement at a halfway house, for aiming a laser at a California Highway Patrol (CHP) Helicopter, announced Acting United States Attorney Brian J. Stretch and Federal Bureau of Investigation Special Agent in Charge David J. Johnson.
In pleading guilty, Palomino, 19, of Oakland, admitted that on June 7, 2014, he knowingly aimed the beam of a laser pointer at a CHP Helicopter. The lasing incident was captured by Palomino in a “selfie” video on his phone. In the videos, Palomino can be heard yelling at the helicopter pilot, “Look at this laser!” In addition, a woman can be heard in the background admonishing Palomino, “Don’t do that! You know you could blind . . . You[’re] going to go to jail if you do that. Don’t do that!”
At the time of the lasing incident, the CHP helicopter was assisting the Oakland Police Department in its efforts to locate a domestic violence suspect. Palomino was indicted by a federal grand jury on August 28, 2014, for aiming a laser pointer at an aircraft, in violation of 18 U.S.C. § 39A.
The sentence was handed down late yesterday by the Honorable Phyllis J. Hamilton, U.S. District Judge. Judge Hamilton also imposed conditions of probation requiring Palomino to refrain from possessing a laser pointer and to perform 200 hours of community service, including educating people about the consequences of aiming laser pointers at aircrafts. Palomino was ordered to self-surrender to the halfway house on January 4, 2016.
Assistant U.S. Attorney Brian C. Lewis prosecuted this case with the assistance of Janice Pagsanjan and Melissa Dorton. This prosecution is the result of an investigation by the FBI and the CHP.
MS-13 Member Pleads Guilty in Violent Racketeering ConspiracyRead the Press Release
Defendant Admitted his Participation in MS-13 and Witness Retaliation Murder Conspiracy
A North Plainfield, New Jersey, man pleaded guilty today to conspiracy to commit murder in furtherance of a racketeering enterprise known as La Mara Salvatrucha, or MS-13, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Paul J. Fishman of the District of New Jersey and Acting Special Agent in Charge Richard M. Frankel of the FBI’s Newark, New Jersey, Division.
Jose Romero-Aguirre, aka Conejo, 29, pleaded guilty before U.S. District Judge Stanley R. Chesler of the District of New Jersey, who scheduled sentencing for March 16, 2016. Romero-Aguirre remains detained pending sentencing.
According to court documents, MS-13 is a national and international gang with branches or “cliques” operating throughout the United States, including in Plainfield, New Jersey. In connection with his plea, Romero-Aguirre admitted that he was a member of the Plainfield Locos Salvatrucha (PLS) Clique of MS-13 for a period of time continuing through at least August 2011. Romero-Aguirre admitted that in or around July 2011, MS-13 members began investigating the arrest of several members of the PLS Clique to identify those who had provided police with information on the arrestees, contrary to PLS rules. Romero-Aguirre admitted that he participated in phone calls with other incarcerated MS-13 members discussing the need to find and kill the witnesses and that he agreed to relay the murder instructions from the incarcerated members to the other MS-13 members.
Twelve other members and associates of the PLS Clique are scheduled for trial in front of Judge Chesler on Feb. 9, 2016. The charges include several counts of murder, attempted murder, robbery, extortion, witness retaliation and sexual assault.
FBI’s Newark Division, U.S. Immigration and Customs Enforcement-Homeland Security Investigations’ Newark Field Office, the Plainfield Police Department and the Union County, New Jersey, Prosecutor’s Office investigated the case. Assistant U.S. Attorneys James Donnelly and Jamari Buxton of the District of New Jersey and Trial Attorney Kevin L. Rosenberg of the Criminal Division’s Organized Crime and Gang Section are prosecuting this case.
Leader of Mail Theft Conspiracy Sentenced to 60 MonthsRead the Press Release
Contact Person: Bill Watkins (864) 282-2100
Columbia, South Carolina ---- United States Attorney Bill Nettles stated today that Tonya M. Reid, age 38, of Anderson, was sentenced today in federal court in Anderson, for conspiracy to commit fraud, a violation of Title 18, United States Code, Section 371. United States District Judge Timothy M. Cain of Anderson sentenced Reid to 60 months imprisonment, ordered that she pay $21,272.97 in restitution, and placed her on three years of supervised release.
Evidence presented at the change of plea hearing established that the United States Postal Inspection Service, the Anderson County Sheriff’s Office, the Anderson City Police Department, and other local agencies had undertaken a long-term investigation into the theft of mail in and around Anderson County. It was discovered that an organization existed that regularly stole mail from residential boxes, sorted the stolen mail for checks and person identifying information, created altered or counterfeit checks, and created false identification documents. Multiple counterfeit and altered checks were passed throughout the upstate. Most of the fraud was conducted in an effort to obtain funds to purchase methamphetamine.
Reid was a leader of an organization of more than 20 individuals. She served as a clearing house for stolen mail and aided other co-conspirators in creating and cashing counterfeit checks. Her co-conspirators are awaiting sentencing or trial.
The case was investigated by agents of United States Postal Inspection Service, the Anderson County Sheriff’s Office, the Anderson City Police Department, and other local law enforcement agencies. Assistant United States Attorney Bill Watkins of the Greenville office handled the case.
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Lawrence Man Arrested for Receiving $146,000 in Stolen Tax Refund ChecksRead the Press Release
BOSTON – A Lawrence man was arrested today on charges that he received stolen U.S. Treasury checks.
Rolfi Espinal, 49, was indicted on 24 counts of receipt of stolen public money and two counts of making false statements.
The indictment alleges that from approximately September to December 2011, Espinal accepted fraudulent U.S. Treasury checks totaling $146,698. In January 2013, Espinal falsely told federal agents that he received the checks as payment for used cars that he had sold to an individual, when, in fact, the individual did not exist and Espinal knew that the checks were obtained fraudulently. Furthermore, Espinal allegedly told the agents that he paid taxes on the income although he only paid taxes on $34,000 in gross receipts.
The charge of receipt of stolen public moneys provides for a sentence of no more than 10 years in prison, three years of supervised release and a fine of $250,000. The charge of making false statements provides for a sentence of no more than five years in prison, two years of supervised release and a fine of $250,000. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz; William P. Offord, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations Boston; and Lisa A. Quinn, Special Agent in Charge of the U.S. Secret Service, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Seth B. Kosto of Ortiz’s Cybercrime Unit.
The details contained in charging document are allegations. Defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt.
Latin King and Two Six Nation Gangs IndictedRead the Press Release
HAMMOND – United States Attorney David Capp announced two additional indictments in the ongoing effort against criminal street gangs in Northwest Indiana. In one indictment, seventeen members or associates of the Latin Kings, all Indiana based, were charged with racketeering and other offenses. In a separate indictment, two additional members of the Two Six Nation were indicted for murder in aid of racketeering.
U.S. Attorney Capp stated, “We have repeatedly announced that if you are a member of a violent street gang we are coming after you. Today’s indictments are the latest in our ongoing enforcement effort to eliminate these criminal organizations from Northwest Indiana. It does not matter how old you are or when your criminal conduct occurred, you are next.”
The Latin King indictment charges 17 members and associates with a criminal conspiracy that spanned a time period from 2003 until November 2015. It alleges that the following individuals were participants in a racketeering conspiracy that involved murder, attempted murder, aggravated battery, kidnapping, sex trafficking and narcotics distribution:
Anton Lamont James aka “Ghost,” 19, of Hammond;
Jason Christopher Brown aka “Midnight,” 21, of Merrillville;
Javier Castillo, 19, of Hammond;
Rodolfo Carlos Flores aka “Big Head,” 29, of Hammond;
Francisco Gamez aka “Frank Nitti,” 30, of Portage;
Alexis Santos, 20, of Hammond;
Joseph Uvalle aka “Little Foot,” 33, of Crown Point;
Pierre Java Forest aka “Joker,” 21, of Harvey, IL;
Keith Trevor Manuel aka “Smiley,” 26, of Gary;
Aldon Perez aka “Spooky,” 20, of Hammond;
Jose Antonio Sanchez aka “Sly,” 26, of Hammond;
Julian Robert Rebeles aka “King Porky,” 24, of Hammond;
Mario Resendiz aka “Spank,” “Rio”, 23, of East Chicago;
Alberto Tirado aka “B Murda,” 25, of East Chicago;
Raymond Fazekas aka “Pirate,” 26, of Lake Station.
The indictment alleges that these defendants were members of various Latin Kings factions in Hammond, East Chicago and Gary. The indictment also alleges a conspiracy to possess and distribute five kilograms of cocaine and 100 kilograms of marijuana against all of these same individuals, in addition to Sean Yancey aka “Demon,” 21 of Gary.
In addition Melinda Milton, 35, of East Chicago and Joseph Uvalle were charged with various counts of sex trafficking by fraud or coercion and interstate transportation for prostitution.
A previous Latin King indictment had charged Anton James, 19, of Hammond, with murder in aid of racketeering and murder resulting from the use of a firearm during a crime of violence for his alleged role in the murder of Martin Hurtado Sr. The indictment alleges that, on Oct. 28, 2014, James shot and killed Hurtado Sr. believing that he was Martin Hurtado Jr., whom James believed was a rival gang member. This count carries over unchanged from the first indictment.
Also, when James was arrested, Dalia Guerrero, 39, of Merrillville, mother of James, used threat of physical force against a witness in order to influence, delay and prevent testimony of a witness in an official proceeding. A week after that incident, Jasmine McMichael, 22, of East Chicago was arrested and charged for her participation in the same confrontation. Guerreo and McMichael were each charged with obstruction of justice under a separate indictment. They have pled guilty to that count, and are awaiting sentencing.
In a separate indictment involving the Two Six Nation criminal organization, Anthony Laviena, 35, of Staten Island, New York, and Deaundra L. Joshua aka “D Ruff,” 45, of Gary, Indiana, were charged with murder in aid of racketeering and use of a firearm in connection with a crime of violence. This is for their alleged roles in the killing of Albert “Greeny” Guzman. The indictment alleges that, on or about October 6, 1999, Laviena and Joshua shot and killed Guzman for the purpose of maintaining and enhancing their positions within the gang.
In addition, the Two Six Nation indictment alleges two more homicides committed by Two Six members in furtherance of this criminal organization. On January 5, 1991, Jesus Fuentes, who recently plead guilty in federal court to racketeering, and others shot an killed Miguel Fernandez, a Latin King member, in East Chicago during an attempted robbery. Also, on October 30, 1997, Fuentes directed Julio Cartagena, now deceased, of Hammond, to kill Edwardo Miranda in Gary as Miranda was believed to have stolen weapons from the Two Six.
The Two Six Nation indictment is being worked in conjunction with the United States Department of Justice, Criminal Division, Organized Crime and Gang Section.
The United States Attorney's Office emphasized that an Indictment is merely an allegation and that all persons charged are presumed innocent until, and unless, proven guilty in court.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
These cases are the result of the investigative efforts of; the Bureau of Alcohol, Tobacco, Firearms and Explosives, the East Chicago Police Department, the Federal Bureau of Investigation, the Gary Police Department, the Hammond Police Department, the Lake County, Indiana, Sheriff’s Department and Lake County High Intensity Drug Trafficking Area officers and agents. The Lake County Prosecutor’s Office also has provided assistance. The Latin King case is being prosecuted by Assistant U.S. Attorneys David J. Nozick, Dean Lanter and Abizer Zanzi of the Northern District of Indiana. The Two-Six case is being prosecuted by Assistant U.S. Attorney David J. Nozick and Thomas M. McGrath of the Northern District of Indiana and Trial Attorney Andrew Creighton of the Criminal Division’s Organized Crime and Gang Section.
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Kuna Man Sentenced for Possession and Distribution of Meth and Unlawful Possession of a FirearmRead the Press Release
BOISE – Brenon Lawrence, 28, of Kuna, Idaho, was sentenced today to 77 months in prison for possession and distribution of methamphetamine, and possession of a firearm in furtherance of drug trafficking, U.S. Attorney Wendy J. Olson announced. Chief U.S. District Judge B. Lynn Winmill also ordered Lawrence to pay a $500 fine and serve five years of supervised release following his incarceration. Lawrence pleaded guilty on July 21, 2015.
According to court proceedings, Lawrence was arrested in Boise, Idaho, on December 9, 2014. Boise police officers went to the Boise residence where Lawrence was then residing to arrest him on a state parole warrant. As he and a female friend left the residence to get into a vehicle, the officers approached him. Lawrence dropped a backpack as he ran back toward the residence. Inside the backpack officers found a loaded 9 mm semi-automatic pistol, a folding knife, an expandable baton, small plastic baggies containing 14.5 grams of meth. Lawrence admitted he had he been “jocky-boxing” in Boise the night before and had stolen the gun from a car to get money.
The case was investigated by the Boise Police Department and the Bureau of Alcohol, Tobacco and Firearms.
KC Man Charged with Producing Child PornRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Kansas City, Mo., man was charged in federal court today with using a two-year-old victim to produce child pornography.
Conner Michael Webb, 27, of Kansas City, was charged in a federal criminal complaint filed in the U.S. District Court in Kansas City, Mo., with one count of producing child pornography.
According to an affidavit filed in support of the complaint, Webb sent a pornographic video of the victim, taken with his cell phone, to the subject of an ongoing federal investigation who was recently arrested in the District of Kansas. That person, identified in court documents as “Subject 1,” allowed federal agents to search his computer and cell phone. Investigators found numerous chat conversations on Subject 1’s cell phone between him and an individual with the username “kinkyconman” and profile name “Kinky PedoBoy,” later identified as Webb.
On Oct. 15, 2015, Webb asked Subject 1 to send him something to “get me in the mood” before he picked up the 2-year-old victim, identified in court documents as “Jane Doe.” Subject 1 sent Webb several images and videos of child pornography on his cell phone. On the afternoon of the same day, Webb sent a pornographic video he had just taken of Jane Doe to Subject 1’s cell phone.
A federal search warrant was executed today to search Webb’s residence, and to seize and search Webb’s computers, phones, and computer media. Webb, who was at home during the search, was transported to FBI headquarters and interviewed. Webb was arrested and remains in federal custody pending a detention hearing.
Dickinson cautioned that the charge contained in this complaint is simply an accusation, and not evidence of guilt. Evidence supporting the charge must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Teresa Moore. It was investigated by the FBI.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Justice Department Recovers over $3.5 Billion from False Claims Act Cases in Fiscal Year 2015Read the Press Release
Recoveries Exceed $3.5 Billion for Fourth Consecutive Year
The Department of Justice obtained more than $3.5 billion in settlements and judgments from civil cases involving fraud and false claims against the government in the fiscal year ending Sept. 30, Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division, announced today. This is the fourth year in a row that the department has exceeded $3.5 billion in cases under the False Claims Act, and brings total recoveries from January 2009 to the end of the fiscal year to $26.4 billion.
“The False Claims Act has again proven to be the government’s most effective civil tool to ferret out fraud and return billions to taxpayer-funded programs,” said Mizer. “The recoveries announced today help preserve the integrity of vital government programs that provide health care to the elderly and low income families, ensure our national security and defense, and enable countless Americans to purchase homes.”
Of the $3.5 billion recovered last year, $1.9 billion came from companies and individuals in the health care industry for allegedly providing unnecessary or inadequate care, paying kickbacks to health care providers to induce the use of certain goods and services, or overcharging for goods and services paid for by Medicare, Medicaid, and other federal health care programs. The $1.9 billion reflects federal losses only. In many of these cases, the department was instrumental in recovering additional millions of dollars for consumers and state Medicaid programs.
The next largest recoveries were made in connection with government contracts. The government depends on contractors to feed, clothe, and equip our troops for combat; for the military aircraft, ships, and weapons systems that keep our nation secure; as well as to provide everything that is needed to fund myriad programs at home. Settlements and judgments in cases alleging false claims for payment under government contracts totaled $1.1 billion in fiscal year 2015.
The False Claims Act is the government’s primary civil remedy to redress false claims for government funds and property under government contracts, including national security and defense contracts, as well as under government programs as varied as Medicare, veterans’ benefits, federally insured loans and mortgages, highway funds, research grants, agricultural supports, school lunches, and disaster assistance. In 1986, Congress strengthened the Act by amending it to increase incentives for whistleblowers to file lawsuits on behalf of the government.
Most false claims actions are filed under the Act’s whistleblower, or qui tam, provisions that allow individuals to file lawsuits alleging false claims on behalf of the government. If the government prevails in the action, the whistleblower, also known as the relator, receives up to 30 percent of the recovery. Whistleblowers filed 638 qui tam suits in fiscal year 2015 and the department recovered $2.8 billion in these and earlier filed suits this past year. Whistleblower awards during the same period totaled $597 million.
Health Care Fraud
Including this past year’s $1.9 billion, the department has recovered nearly $16.5 billion in health care fraud since January 2009 to the end of fiscal year 2015 – more than half the health care fraud dollars recovered since the 1986 amendments to the False Claims Act. These recoveries restore valuable assets to federally funded programs such as Medicare, Medicaid, and TRICARE – the health care program for the military. But just as important, the department’s vigorous pursuit of health care fraud prevents billions more in losses by deterring others who might otherwise try to cheat the system for their own gain. The department’s success is a direct result of the high priority the Obama Administration has placed on fighting health care fraud. In 2009, the Attorney General and the Secretary of the Department of Health and Human Services, the department that administers Medicare and Medicaid, announced the creation of an interagency task force called the Health Care Fraud Prevention and Enforcement Action Team (HEAT), to increase coordination and optimize criminal and civil enforcement. Additional information on the government’s efforts in this area is available at StopMedicareFraud.gov, a webpage jointly established by the Departments of Justice and Health and Human Services.
Two of the largest health care recoveries this past year were from DaVita Healthcare Partners, Inc., the leading provider of dialysis services in the United States. DaVita paid $450 million to resolve allegations that it knowingly generated unnecessary waste in administering the drugs Zemplar and Venofer to dialysis patients, and then billed the government for costs that could have been avoided. DaVita paid an additional $350 million to resolve claims that it violated the False Claims Act by paying kickbacks to physicians to induce patient referrals to its clinics. DaVita is headquartered in Denver, Colorado, and has dialysis clinics in 46 states and the District of Columbia.
Hospitals were involved in nearly $330 million in settlements and judgments this past year. A cardiac nurse and a health care reimbursement consultant filed a qui tam suit against hundreds of hospitals that were allegedly implanting cardiac devices in Medicare patients contrary to criteria established by the Centers for Medicare and Medicaid Services in consultation with cardiologists, professional cardiology societies, cardiac device manufacturers, and patient advocates. The department settled with nearly 500 of these hospitals for a total of $250 million, including $216 million recovered in the past fiscal year. For details, see 500 Hospitals.
Several settlements involved violations of the Stark Law. The Stark Statute prohibits certain financial relationships between hospitals and doctors that could improperly influence patient referrals. Services provided in violation of the Stark Statute are not reimbursable by Medicare or Medicaid. Hospitals settling false claims involving Stark violations include Adventist Health System for $115 million, an organization that operates hospitals and other health care facilities in 10 states; North Broward Hospital District for $69.5 million, a special taxing district of Florida that operates hospitals and other health care facilities in Broward County, Florida; and Georgia hospital system Columbus Regional Healthcare System and Dr. Andrew Pippas for $25 million plus contingent payments up to an additional $10 million. The Adventist settlement also involved allegations of miscoding claims to obtain higher reimbursements for services than allowed by Medicare and Medicaid.
Claims involving the pharmaceutical industry accounted for $96 million in settlements and judgments. Daiichi Sankyo Inc., a global pharmaceutical company with its U.S. headquarters in New Jersey, paid $39 million to resolve allegations of false claims against the United States and state Medicaid programs. Daiichi allegedly paid kickbacks to physicians to induce them to prescribe Daiichi drugs, including Azor, Benicar, Tribenzor and Welchol. Medicare and Medicaid prohibit reimbursement for drugs involved in kickback schemes. AstraZeneca LP and Cephalon Inc. paid the United States $26.7 million and $4.3 million, respectively, in separate settlements for allegedly underpaying rebates owed under the Medicaid Drug Rebate Program. As part of those settlements, the two drug manufacturers agreed to pay an additional $23 million to state Medicaid programs for their losses. And in another settlement, PharMerica Corp., the nation’s second largest nursing home pharmacy, agreed to pay the United States $9.25 million to resolve allegations that it solicited and received kickbacks from pharmaceutical manufacturer Abbott Laboratories in exchange for promoting the drug Depakote for nursing home patients. PharMerica is headquartered in Louisville, Kentucky.
Skilled nursing homes and rehabilitation facilities have also been fertile ground for civil fraud and false claims actions. In the largest failure of care settlement with a skilled nursing home chain in the department’s history, Extendicare Health Services Inc. and its subsidiary, Progressive Step Corporation, agreed to pay the United States $32.3 million to resolve allegations that Extendicare billed Medicare and Medicaid for deficient nursing services and billed Medicare for medically unreasonable and unnecessary rehabilitation therapy services. Extendicare and Pro-Step paid an additional $5.7 million to eight states for their Medicaid losses. The department has ongoing litigation against additional nursing home chains and rehabilitation centers based on similar allegations of false claims for medically unreasonable or unnecessary rehabilitation therapy. For example, see HCR ManorCare.
Housing and Mortgage Fraud
The department has recovered over $5 billion in housing and mortgage fraud from January 2009 to the end of fiscal year 2015, including this past year’s recoveries of $365 million. Notable recoveries this past year include a $212.5 million settlement with First Tennessee Bank N.A. First Tennessee admitted that from 2006 to 2008, through its subsidiary, First Horizon Home Loans Corporation, it originated and endorsed mortgages for federal insurance by the Federal Housing Administration (FHA) that did not meet eligibility requirements. First Tennessee also admitted failing to report such deficiencies to the authorities as required under the program despite widespread knowledge by its senior managers by early 2008. In August 2008, First Tennessee sold First Horizon to MetLife Bank N.A., a wholly-owned subsidiary of MetLife Inc. Metlife admitted similar misconduct regarding the loans it originated and endorsed from September 2008 to March 2012. MetLife paid the United States $123.5 million to resolve liability under the False Claims Act arising from its misconduct in endorsing mortgagees for FHA insurance.
The department also settled claims against Walter Investment Management Corp. for $29.63 million. The government alleged that the company, through subsidiaries Reverse Mortgage Solution Inc., REO Management Solutions LLC, and RMS Asset Management Solutions LLC, caused false claims for fees and other costs in servicing reverse mortgages under the Department of Housing and Urban Development’s (HUD’s) Home Equity Conversion Mortgages (HECM) program. Reverse mortgage loans allow elderly people to access the equity in their homes. The loans provide monthly payments that enable the elderly to meet their day-to-day living expenses while remaining in their homes. To encourage these loans, HUD insures banks and other institutions that service the mortgages against loss, providing the institution complies with requirements to ensure the quality of such loans. Walter Investment allegedly failed to comply with these requirements.
These recoveries are part of the broader enforcement efforts by President Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency task force in 2009, to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information about the task force, visit www.stopfraud.gov.
Government Contracts
Government contracts and federal procurement accounted for $1.1 billion in fraud settlements and judgments in fiscal year 2015, bringing procurement fraud totals to nearly $4 billion from January 2009 to the end of the fiscal year. Significant cases include a $146 million settlement with Supreme Group B.V. and several of its subsidiaries for alleged false claims to the Department of Defense (DoD) for food, water, fuel, and transportation of cargo for American soldiers in Afghanistan. Supreme Group is based in Dubai, United Arab Emirates (UAE). In addition, Supreme Group affiliates Supreme Foodservice GmbH, a privately held Swiss company, and Supreme Foodservice FZE, a privately-held UAE company, pleaded guilty to related criminal violations and paid more than $288 million in criminal fines.
In two other defense contract settlements, Lockheed Martin Integrated Systems, a subsidiary of aerospace giant Lockheed Martin Inc., paid $27.5 million and DRS Technical Services Inc. paid $13.7 million to resolve allegations that their employees lacked required job qualifications while the companies charged for the higher level, qualified employees required under contracts with U.S. Army Communication and Electronics Command (CECOM). The CECOM contracts were designed to give the Army rapid access to products and services for operations in Iraq and Afghanistan.
In a pair of cases involving contracts with the General Services Administration, VMware Inc. and Carahsoft Technology Corporation paid the United States $75.5 million and Iron Mountain Companies paid $44.5 million to settle their respective liability under the False Claims Act. The government alleged that California-based VMware and Virginia-based Carahsoft misrepresented their commercial sales practices, which resulted in overcharging government agencies for their software products and services sold through GSA’s Multiple Award Schedule. Similarly, Iron Mountain, a records storage company headquartered in Massachusetts, misrepresented its commercial sales practices to GSA and failed to give certain discounts given to its commercial customers, as required to gain access to the vast federal marketplace available to contractors through the Multiple Award Schedule.
The department settled allegations that private contractor U.S. Investigations Services Inc. (USIS) violated the False Claims Act in performing a contract with the Office of Personnel Management (OPM) to perform background investigations of federal employees and those applying for federal service. The government alleged that USIS took shortcuts that compromised its contractually-required quality review and that, had the government known, it would not have paid for the services. USIS agreed to forego at least $30 million in payments legitimately owed to the company to settle the government’s allegations.
Other Fraud Recoveries and Actions
Although health care, mortgage, and government contract fraud dominated fiscal year 2015 recoveries, the department has aggressively pursued fraud wherever it is found in federal programs. For example, the department recovered $44 million from Fireman’s Fund Insurance Company for alleged fraud under the U.S. Department of Agriculture’s federal crop insurance program. The United States alleged that Fireman’s Fund knowingly issued federally reinsured crop insurance policies that were ineligible for federal reinsurance. Specifically, Fireman’s Fund allegedly backdated policies, forged farmers’ signatures, accepted late and altered documents, whited-out dates and signatures, and signed documents after relevant deadlines. The policies were issued by Fireman’s Fund offices in California, Kansas, Mississippi, North Dakota, Texas, and Washington.
The department also recovered $13 million from Education Affiliates, a for-profit education company based in White Marsh, Maryland, for alleged false claims to the Department of Education for student aid for students whose qualifications for admission were falsified to get them enrolled so they could receive aid which would be paid to the school. Education Affiliates operates 50 campuses throughout the United States under various trade names.
In other actions, the department filed lawsuits to recover funds disbursed under the Troubled Asset Relief Program (TARP) and payments made under contracts awarded to benefit disadvantaged populations identified under the Small Business Administration’s set-aside programs. In one action, the department sued the estate and trusts of the late Layton P. Stuart, former owner and president of One Financial Corporation, and its operating subsidiary, One Bank & Trust N.A., both based in Arkansas, alleging that Stuart made misrepresentations to induce the Department of the Treasury to invest TARP funds in One Financial as part of Treasury’s Capital Purchase Program. The department recently settled with the Stuart estate and trusts for $4 million, but claims remain pending against One Financial Corporation.
In a second action, the department filed suit against Florida-based Air Ideal Inc. and its owner, Kim Amkraut. The government alleged that Air Ideal and Amkraut falsely certified that the company qualified for preferences given to small businesses located in a Historically Underutilized Business Zone (HUBZone) when Air Ideal’s HUBZone location was no more than a virtual office and its principal place of business was in a non-HUBZone location. The government further alleged that Air Ideal used its fraudulently-procured HUBZone certification to obtain contracts from the Coast Guard, Army, Army Corps of Engineers, and Department of the Interior that were worth millions of dollars. The department settled with Air Ideal and Amkraut for $250,000 plus five percent of Air Ideal’s gross revenues for five years.
These suits and settlements illustrate the diversity of cases pursued by the department and the department’s quest to root out fraud and false claims against the government wherever it may be found.
Holding Individuals Accountable
On Sept. 9, Deputy Attorney General Sally Quillian Yates issued a memorandum on individual accountability for corporate wrongdoing. This memorandum reinforced the department’s commitment to use the False Claims Act and other civil enforcement tools to deter and redress fraud by individuals as well as corporations.
In addition to those suits involving individuals described above, the department settled or filed suit against individuals in an array of cases. For example, Two Florida couples agreed to pay the United States $1.137 million collectively, to resolve allegations that they accepted kickbacks in exchange for home health care referrals to A Plus Home Health Care Inc. The United States previously settled with A Plus, its owner Tracy Nemerofsky, and five other couples that allegedly accepted payments from A Plus. Dr. Charles Denham, of Laguna Beach, California, paid the United States $1 million to settle allegations that he solicited and accepted kickbacks from CareFusion in return for promoting a CareFusion product and influencing recommendations by the National Quality Forum. Denham was a patient safety consultant who co-chaired a National Quality Forum Committee. After settling with two cardiovascular testing laboratories for $48.5 million - Health Diagnostics Laboratory Inc. (HDL) and Singulex Inc., the department intervened in three qui tam suits against another laboratory, Berkeley HeartLab Inc., a marketing company, BlueWave Healthcare Consultants Inc. and three individuals – BlueWave’s owners, Floyd Calhoun Dent III and Robert Bradley Johnson and HDL’s co-founder and former chief executive officer, LaTonya Mallory. The department also intervened in two qui tam suits against Florida cardiologist Dr. Asad Qamar and his practice, the Institute for Cardiovascular Excellence PLLC, alleging that Qamar and his practice billed Medicare for medically unnecessary peripheral artery procedures and interventions and paid kickbacks to patients by waiving Medicare copayments irrespective of financial hardship. The department also filed a complaint against H. Ted Cain, Julie Cain, Corporate Management Inc. and Stone County Hospital Inc. for false claims for Medicare reimbursement. The government alleged that Ted and Julie Cain, the hospital and hospital management company owned and controlled by Ted Cain, claimed reimbursement for the hospital’s costs at inflated rates and for ineligible expenses. These matters are ongoing.
Outside the health care arena, EDF Resource Capital Inc. agreed to transfer assets worth $5.8 million to the United States, and its chief executive officer, Frank Dinsmore, agreed to pay $200,000 to the United States, to settle allegations that they violated the False Claims Act in failing to remit payments to the Small Business Administration under the 504 loan program. The 504 loan program provides growing businesses with long-term, fixed-rate financing for major fixed assets, such as land and buildings. The program operates through local lenders like EDF, who reap benefits from the program in return for shouldering certain financial obligations which Dinsmore and EDF allegedly ignored. The department also entered settlements with two individuals for evasion of Customs duties owed on imports of aluminum extrusions from the People’s Republic of China (PRC). Robert Wingfield, the U.S. sales representative of a Chinese manufacturer, and Bill Ma, owner of an ostensible importer, allegedly misrepresented the country of origin of goods to avoid steep antidumping and countervailing duties imposed by the Department of Commerce and collected by U.S. Customs and Border Protection on imports of aluminum extrusions from the PRC to protect domestic manufacturers from unfair foreign pricing practices. The government previously settled related allegations with four importers, bringing total settlements in the case to $4.6 million, including the $435,000 from Wingfield and Ma.
Recoveries in Whistleblower Suits
Of the $3.5 billion the government recovered in fiscal year 2015, more than $2.8 billion related to lawsuits filed under the qui tam provisions of the False Claims Act. During the same period, the government paid out $597 million to the individuals who exposed fraud and false claims by filing a qui tam complaint, often at great risk to their careers.
The number of lawsuits filed under the qui tam provisions of the Act has grown significantly since 1986, with 638 qui tam suits filed this past year. The growing number of qui tam lawsuits, particularly since 2009, has led to increased recoveries. From January 2009 to the end of fiscal year 2015, the government recovered $19.4 billion in settlements and judgments related to qui tam suits and paid whistleblower awards of $3 billion during the same period.
“Many of the recoveries obtained under the False Claims Act result from courageous men and women who come forward to blow the whistle on fraud they are often uniquely positioned to expose,” said Principal Deputy Assistant Attorney General Mizer.
In 1986, Senator Charles Grassley and Representative Howard Berman led successful efforts in Congress to amend the False Claims Act to, among other things, encourage whistleblowers to come forward with allegations of fraud. In 2009, Senator Patrick J. Leahy, along with Senator Grassley and Representative Berman, championed the Fraud Enforcement and Recovery Act of 2009, which made additional improvements to the False Claims Act and other fraud statutes. And in 2010, the passage of the Affordable Care Act provided additional inducements and protections for whistleblowers and strengthened the provisions of the federal health care Anti-Kickback Statute.
Principal Deputy Assistant Attorney General Mizer also expressed his deep appreciation for the many dedicated public servants who investigated and pursued these cases – the attorneys, investigators, auditors and other agency personnel throughout the Department of Justice’s Civil Division and the U.S. Attorneys’ Offices, as well as the agency Offices of Inspector General and the many federal and state agencies that contributed to the department’s recoveries this past fiscal year.
“The department’s lawyers and staff, together with our law enforcement partners in federal and state governments, work tirelessly and often overcome daunting challenges to achieve these successes on behalf of the taxpayers,” said Principal Deputy Assistant Attorney General Mizer.
The government’s claims in the matters described above are allegations only; except where indicated, there has been no determination of liability.
Justice Department Files Lawsuit Against Lubbock, Texas, Alleging National Origin and Sex Discrimination in Hiring of Police OfficersRead the Press Release
The Justice Department yesterday filed a lawsuit against the city of Lubbock, Texas, alleging that the city’s police department engaged in a pattern or practice of employment discrimination against Hispanics and women in violation of Title VII of the Civil Rights Act of 1964.
The lawsuit, filed in the U.S. District Court for the Northern District of Texas, alleges that the Lubbock Police Department’s (LPD) written and physical fitness examinations had the effect of excluding Hispanic and female applicants from consideration for hire as entry-level police officers without a showing that these tests screened candidates for skills that are required for the job.
“We share with Lubbock the goal of hiring qualified applicants to perform critical public safety functions,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division. “Federal law prohibits employers from using discriminatory employment practices that do not meaningfully evaluate one’s ability to perform a given job. The Department of Justice will ensure that the city eliminates the use of these unlawful tests and we hope to work cooperatively with the city to create new selection procedures that do not unlawfully discriminate.”
This lawsuit seeks a court order requiring LPD to stop using the challenged examinations, develop selection procedures for entry-level police officer positions at LPD that comply with Title VII and provide make-whole relief including, where appropriate, offers of hire, back pay and retroactive seniority, to qualified Hispanics and women who have been or will be harmed as a result of LPD’s use of the challenged examinations.
The enforcement of federal employment discrimination laws is a top priority for the Justice Department. Additional information about Title VII and other federal employment laws is available on the Civil Rights Division’s website at http://www.justice.gov/crt/.
Lubbock Complaint
Justice Department Collects More Than $23 Billion in Civil and Criminal Cases in Fiscal Year 2015Read the Press Release
Attorney General Loretta E. Lynch announced today that the Justice Department collected $23.1 billion in civil and criminal actions in the fiscal year (FY) ending Sept. 30, 2015. Collections in FY 2015 represent more than seven and a half times the approximately $2.93 billion of the Justice Department’s combined appropriations for the 94 U.S. Attorneys’ offices and the main litigating divisions in that same period.
“The Department of Justice is committed to upholding the rule of law, safeguarding taxpayer resources and protecting the American people from exploitation and abuse,” said Attorney General Lynch. “The collections we are announcing today demonstrate not only the strength of that commitment, but also the significant return on public investment that our actions deliver. I want to thank the prosecutors and trial attorneys who made this achievement possible, and to reiterate our dedication to this ongoing work.”
The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal financial, health, safety, civil rights and environmental laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education.
The total includes all monies collected as a result of Justice Department-led enforcement actions and negotiated civil settlements. It includes more than $16.2 billion in payments made directly to the Justice Department and more than $6.8 billion in indirect payments made to other federal agencies, states and other designated recipients.
In measuring collections recovered in FY 2015, this figure necessarily includes some cases that were resolved in previous years but the proceeds of which were collected in FY 2015.
Among the top 20 debt collections, the largest came from financial institutions whose risky practices led up to the 2008 financial crisis and collapse of the U.S. housing market, including $8.2 billion of the settlement in August 2014 with Bank of America Corporation, which included $5 billion in penalties for claims under the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) – the largest FIRREA penalty ever – and $687 million from the February 2015 settlement with McGraw Hill Financial Inc. and Standard & Poor’s Financial Services LLC.
The department continued to make polluters pay to safeguard the environment and the taxpayer, collecting $1.8 billion of the total $5.1 billion settlement of the Tronox Inc. bankruptcy in January 2015, the majority of which is being used for cleanups of Kerr-McGee sites, including on tribal lands and in low-income communities across the United States. From the November 2014 settlement with Hyundai and Kia, the automakers paid $93.6 million to the United States, of a $100 million civil penalty owed to the United States and the California Air Resources Board, to resolve violations concerning the testing and certification of vehicles sold in America.
As in previous years, recoveries for health care fraud were among the largest, including $807 million from DaVita Healthcare Partners to settle two False Claims Act cases which involved kickback schemes and fraudulent billing of the federal government.
Growing out of the international scheme to manipulate the London Interbank Offer Rate (LIBOR), the department obtained resolutions from several banks. Notably, Deutsche Bank entered into a deferred prosecution agreement in which it admitted its role in fraud and price-fixing conspiracies by rigging Yen LIBOR contributions with other banks and paid $625 million in penalties, in addition to regulatory penalties and disgorgements imposed by other agencies. A Deutsche Bank subsidiary in the United Kingdom also pleaded guilty for its role in the rate manipulation.
Additionally, in March, Commerzbank AG, agreed to pay a $79 million fine to the department, in addition to a $563 million forfeiture, as part of a global settlement of charges for violating the International Emergency Economic Powers Act and the Bank Secrecy Act. For six years Commerzbank knowingly and willfully moved approximately $263 million through the U.S. financial system on behalf of sanctioned entities in Iran and Sudan.
The Swiss Bank Program yielded more than $350 million in penalties from dozens of Swiss banks that reached non-prosecution agreements with the department in FY 2015.
The department collected hundreds of millions of dollars in criminal fines and penalties from companies involved in conspiracies to subvert competitive markets. Over the last year, the department collected fines greater than $10 million from nine companies involved in price-fixing conspiracies, including more than $200 million from auto parts suppliers and over $100 million from ocean freight companies. The department has also brought civil suits to stop anticompetitive behavior and collected civil penalties and disgorgement that deprived companies of the proceeds of illegal pre-merger coordination.