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Monday 28 September 2015
Alleged Members of the Gangster Disciples Indicted for Roles in Attempted Murder of Five TeensRead the Press Release
Memphis, TN – Several alleged members of the Gangster Disciples have been indicted federally for their roles in the attempted murder of five teenagers in South Memphis.
U.S. Attorney Edward L. Stanton III; Shelby County District Attorney General Amy Weirich; Memphis Police Director Toney Armstrong; Shelby County Sheriff Bill Oldham; Special Agent in Charge for the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Steven Gerido; and Federal Bureau of Investigation (FBI) Special Agent in Charge Todd McCall announced the superseding indictment today.
According to the superseding indictment, Ranito Allen, aka Nito, 35; Florence Anthony, aka Nikki, 36; Edwin Carvin, aka Ren, 38; Brandon Milton, aka Lil Folk, 30; and Erik Reese, aka E, 35, all of Memphis, were charged with five counts of attempted murder in aid of racketeering, among other offenses. Candies Wesley, 29, also of Memphis, was charged with being an accessory after the fact of attempted murder in aid of racketeering.
Alleged gang member Robert Mallory, aka Rambo, 33, was previously charged in this case. He remains charged in the superseding indictment.
As the superseding indictment alleges, all seven defendants are members of the Gangster Disciples, which is a nationally-known organized street gang that originated in the Chicago area and spread to other regions of the United States, including Memphis and surrounding areas. The Gangster Disciples are responsible for committing multiple acts of violence, including murder, attempted murder, and aggravated assault. The gang is also responsible for distributing large quantities of narcotics and trafficking firearms.
In June 2014, the defendants allegedly participated in the attempted murder of five teenagers in South Memphis for the purpose of gaining entrance to, maintaining or increasing their position in the Gangster Disciples.
Six of the defendants – Ranito Allen; Florence Anthony; Edwin Carvin; Brandon Milton; Robert Mallory; and Erik Reese – were charged with five counts of attempted murder. They each were also charged with five counts of using and carrying a firearm during and in relation to a crime of violence, aiding and abetting.
Mallory, Allen, and Carvin have all also been charged with being felons in possession of firearms.
This case is being investigated by the FBI, which is a part of the Multi-Agency Gang Unit (MGU). MGU is also comprised of the Memphis Police Department; Shelby County Sheriff’s Office; U.S. Attorney’s Office; and the Shelby County District Attorney General’s Office.
The case is being prosecuted by Assistant U.S. Attorneys Jerry Kitchen and Sam Stringfellow and David N. Karpel of the Criminal Division’s Organized Crime and Gang Section, in cooperation with the Shelby County District Attorney General’s Office.
The charges contained in the superseding indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Alleged Members of Gangster Disciples Indicted for Roles in Five Attempted MurdersRead the Press Release
Six alleged members of the violent Gangster Disciples Gang have been indicted by a federal grand jury for their roles in the attempted murders of five teenagers in South Memphis, Tennessee. Three alleged gang members previously had been charged in this case.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Edward L. Stanton III of the Western District of Tennessee made the announcement.
Ranito Allen, aka Nito, 35; Florence Anthony, aka Nikki, 36; Edwin Carvin, aka Ren, 38; Brandon Milton, aka Lil Folk, 30; and Erik Reese, aka E, 35, all of Memphis, Tennessee, were charged in a superseding indictment unsealed today with five counts of attempted murder in aid of racketeering and related firearms offenses. In addition, Candice Wesley, 29, of Memphis, was charged with being an accessory after the fact.
According to the superseding indictment, the defendants are members of the Gangster Disciples, which is a nationally-known organized street gang that originated in the Chicago area and spread to other regions of the United States, including the greater Memphis area. The superseding indictment alleges that members and associates of the Gangster Disciples engaged in acts of violence, including murder, attempted murder and aggravated assault, as well as narcotics distribution and other criminal activities.
Specifically, the superseding indictment charges the defendants with participating in the attempted murders of five teenagers in South Memphis on or about June 21, 2014. According to the superseding indictment, the defendants did so for the purpose of gaining entrance to, or maintaining or increasing their positions in, the Gangster Disciples.
Tony Coburn, aka Blue, 26; Robert Mallory, aka Rambo, 33; and Almeda Burgess, aka Big Heavy, 28, previously were charged in this case. Mallory remains charged in the superseding indictment. Coburn pleaded guilty on July 28, 2015, to his role in the shootings, and Burgess pleaded guilty on Sept. 9, 2015, to being an accessory after the fact.
The charges and allegations in the superseding indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
This case is being investigated by a multi-agency task force consisting of the FBI; the Bureau of Alcohol, Tobacco, Firearms and Explosives’ Memphis Multi-Agency Gang Unit; the Memphis Police Department; the Shelby County, Tennessee, Sheriff’s Office and the Atascosa County, Tennessee, District Attorney’s Office.
The case is being prosecuted by David N. Karpel of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorneys Jerry Kitchen and Sam Stringfellow of the Western District of Tennessee. The Shelby County District Attorney’s Office has provided substantial assistance.
Mallory et al Superseding Indictment
4 Involved in Inland Empire Loan Modification Scam that Targeted Financially Distressed Homeowners Sentenced to Federal PrisonRead the Press Release
RIVERSIDE, California – Four people who worked at a Rancho Cucamonga business that offered bogus loan modification programs to thousands of financially distressed homeowners – victims who lost more than $7 million when they paid for services that were never provided – were sentenced today to federal prison, with one of the leaders of the scheme being ordered to spend 20 years in custody.
The Southland residents sentenced today were convicted of federal fraud charges for their roles in a telemarketing operation known under a series of names – including 21st Century Legal Services, Inc. – that bilked more than 4,000 homeowners across the nation, many of whom lost their homes to foreclosure.
The defendants sentenced today by United States District Judge Virginia A. Phillips were:
• Christopher Paul George, 45, of Rancho Cucamonga, a co-owner of 21st Century, who was sentenced to 20 years in federal prison;
• Crystal Taiwana Buck, 40, of Long Beach, a sales “closer” who persuaded numerous victims to pay fees to 21st Century, who received a sentence of five years;
• Albert DiRoberto, 62, of Fullerton, who handled both sales and marketing – which included making a commercial for 21st Century and preparing talking points to respond to negative publicity – was sentenced to five years in prison; and
• Yadira Garcia Padilla, 38, of Rancho Cucamonga – who handled client complaints and refund requests, and who posted bogus positive reviews about 21st Century on the Internet – was sentenced to four years in prison.
George, Buck and DiRoberto were sentenced after being found guilty by a federal jury in June on various fraud charges. Padilla pleaded guilty in 2013.
In addition to the prison term, Judge Phillips today ordered George to pay $7,065,117 in restitution to victims of the scam. Buck, DiRoberto and Padilla were ordered to return to court next month for restitution hearings.
A total of 11 defendants linked to 21st Century have been convicted of federal fraud charges as a result of an investigation conducted by the Federal Bureau of Investigation; IRS - Criminal Investigation; the United States Postal Inspection Service; the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP); and the Federal Housing Finance Agency, Office of Inspector General.
During a 15-month period that began in the middle of 2008, a Rancho Cucamonga woman – Andrea Ramirez, 47, who previously pleaded guilty to fraud charges and is scheduled to be sentenced by Judge Phillips of November 15 – operated 21st Century, which defrauded financially distressed homeowners by making false promises and guarantees regarding 21st Century’s ability to negotiate loan modifications for homeowners. Employees of 21st Century made numerous misrepresentations to victims during the course of the scheme, including falsely telling victims that 21st Century was operating a loan modification program sponsored by the United States government. Victims were generally instructed to stop communicating with their mortgage lenders and to cease making their mortgage payments.
In addition to being a co-owner of 21st Century, George acted as a sales manager, and he ran his own sales office there for several months. George instructed 21st Century employees to make misrepresentations to distressed homeowners, including guaranteeing that 21st Century would obtain loan modifications and telling homeowners that payments made to 21st Century would go towards homeowners’ mortgages.
21st Century employees contacted distressed homeowners through cold calls, newspaper ads and mailings, and the company controlled websites that advertised loan modification services. Once they contacted the distressed homeowners, 21st Century employees often falsely told clients that the company was operating through a federal government program, that they would be able to obtain new mortgages with specific interest rates and reduced payments, and that attorneys would negotiate loan modifications with their lenders. 21st Century employees regularly instructed financially distressed homeowners to cease making mortgage payments to their lenders and to cut off all contact with their lenders because they were being represented by 21st Century. On some occasions, 21st Century employees told homeowners that 21st Century was using the fees paid by the homeowner to make mortgage payments, when Ramirez, George and their co-defendants simply were pocketing the homeowners’ money.
In addition to Ramirez and the four sentenced today, six other defendants previously pleaded guilty. They are:
• Michael Bruce Bates, of Moreno Valley, who is scheduled to be sentenced on October 19;
• Michael Lewis Parker, of Pomona, who is scheduled to be sentenced on November 19;
• Catalina Deleon, of Glendora, who is scheduled to be sentenced on December 14;
• Hamid Reza Shalviri, of Montebello, who is scheduled to be sentenced on December 7;
• Mindy Sue Holt, of San Bernardino, who is scheduled to be sentenced on October 26; and
• Iris Melissa Pelayo, of Upland, who has been sentenced to four years in federal prison.
$2.6 Million Recovered Through Settlement of False Claims Act Allegations Against American Access CareRead the Press Release
PROVIDENCE, R.I. - United States Attorney Peter F. Neronha and Phillip Coyne, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), New England Region, announced today that American Access Care Holdings, LLC, (AAC) which handled billings and claims submitted by a vascular access center formerly operated by AAC in Providence, R.I., has agreed to pay $2.6 million dollars to resolve allegations that it violated the False Claims Act as a result of conduct at its Providence access center.
Among other services, access care facilities address complications with dialysis access for patients with kidney disease. In this case, the Government alleged that AAC violated the False Claims Act through its knowing submission of three types of claims: (1) billing Medicare for percutaneous transluminal angioplasties (PTAs) that were medically unnecessary under Medicare guidance; (2) billing for more PTAs per patient encounter than permitted; and (3) billing for medically unnecessary procedures during follow-up visits.
“Doctors and companies that choose to collect federal healthcare dollars must do so with a clear understanding that those dollars come with responsibilities – first and foremost, that all care is billed because it’s necessary for the patient, not the bottom line,” announced U.S. Attorney Neronha. “Today’s settlement is a reminder that we will continue to vigorously police compliance with program standards to ensure that taxpayer dollars are spent only in the appropriate manner.”
“Health care providers will not be permitted to provide unnecessary medical procedures – in this case, invasive procedures -- on patients and then pocket the improper payments they receive as a result," said Special Agent in Charge Philip Coyne of the U.S. Department of Health and Human Services Office of Inspector General. “Our agency is dedicated to investigating health care fraud schemes that divert scarce taxpayer funds meant to provide for legitimate patient care.”
The government’s case was resolved under the federal False Claims Act, which allows the United States to recover federal funds that are paid out as a result of knowingly false or fraudulent claims, along with multiple damages. The Rhode Island settlement is concluded simultaneously with the resolution of claims against AAC by the United States Attorney for the District of Connecticut, and follows a third settlement against this company in the Southern District of Florida, in the case United States ex rel. Souza v. American Access Care of Miami, LLC (S.D. Fla.).
Former AAC facilities, including the one in Providence, are now operated by Fresenius Vascular Care, Inc. The conduct addressed by the settlement agreement took place prior to the merger between the two entities.
The investigation of this matter is the result of a coordinated effort between the U.S. Attorney’s Office for the District of Rhode Island and HHS-OIG.
The matter was litigated by Assistant U.S. Attorneys Zachary A. Cunha and Mary E. Rogers.
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Contact:
Jim Martin (401) 709-5357
email: [email protected]
on Twitter @USAO_RI
Saturday 26 September 2015
U.S. Attorney’s Office Joins DEA for 10th National Prescription Drug Take-BackRead the Press Release
Memphis, TN – This Saturday, the U.S. Attorney’s Office will join the Drug Enforcement Administration (DEA) for its 10th National Prescription Drug Take-Back. Edward L. Stanton III, U.S. Attorney for the Western District of Tennessee, and Michael Stanfill, Assistant Special Agent in Charge of the DEA’s Atlanta Field Division – Memphis Resident Office, announced the collaboration today.
"Prescription drug abuse constitutes one of the greatest public safety and public health epidemics of our time, inflicting devastating, long-term effects on individuals – and destroying families, neighborhoods, and entire communities. Join our fight against this issue by ridding your medicine cabinets of any unneeded prescription drugs."
The Prescription Drug Take-Back will take place in West Tennessee and nationwide Saturday, September 26th, from 10 a.m. to 2 p.m. Collection sites will be set up throughout local communities for residents to safely dispose their unused, unwanted, and/or expired prescription drugs. Residents can visit
www.dea.gov to view the sites for every local community. New take-back locations will be added to the website on a continuous basis.
The nine Take-Backs that have occurred over the last four years have produced substantial results: More than 4.8 million pounds (2,411 tons) of prescription drugs have been collected by law enforcement. The last Take-Back event in September 2014 garnered 617,150 pounds (309 tons) of unwanted medicine across the country. In Tennessee, there were 11,510 pounds of prescription drugs disposed of by residents during last year’s take-back.
"Prescription drug abuse is a huge problem, and this is a great opportunity for folks around the country to help reduce the threat," Stanfill said. "Please clean out your medicine cabinet and make your home safe from drug theft and abuse."
Prescription drug abuse has grown into a nationwide epidemic over recent years. It's the fastest-growing illicit drug issue in the country, according to the DEA's "National Drug Threat Assessment." Two and a half times more Americans currently abuse prescription drugs than those using cocaine, heroin, hallucinogens, and inhalants combined. Furthermore, a significant amount of people suffer accidental poisonings and overdoses due to overconsumption of prescription drugs.
Launched in 2010, the Prescription Drug Take-Backs are a way to spread awareness of, and help suppress, pharmaceutical-controlled substance abuse, distribution, and theft across the country. Studies have revealed that many of those who abuse prescription drugs obtain them from family and friends. Furthermore, many Americans do not know how to properly dispose of their unused medicine, often flushing them down the toilet or throwing them away – both potential safety and health hazards.
In addition to dea.gov, other websites adults and children can visit to educate themselves on the dangers of legal and illegal drugs are
www.justhinktwice.com and www.GetSmartAboutDrugs.com.
Friday 25 September 2015
Yakima Man Sentenced to 15 Years Imprisonment for CarjackingRead the Press Release
Spokane – Today, Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that Samuel Luis Gutierrez, age 33, was sentenced to 15 years imprisonment for brandishing a firearm during a crime of violence.
According to information disclosed during court proceedings, on November 10, 2014, at approximately 5:34 p.m., a female parked her vehicle at the Harmon Senior Center located in Yakima, Washington. The female subsequently exited the vehicle. Gutierrez observed the female in the parking lot. He approached the victim from behind and demanded the keys to the vehicle. The victim turned around and observed that Gutierrez was brandishing a firearm. He again demanded the keys to the vehicle. Gutierrez stole the vehicle and several personal items belonging to the victim. The incident was immediately reported to the Yakima Police Department. Officers quickly responded to the area and observed the vehicle. As the events unfolded, Gutierrez exited the stolen vehicle and attempted run away. Officers later found Gutierrez outside of a residence. Personal property belonging to the victim was found on his person.
As the investigation proceeded, it was determined that Gutierrez had previously been convicted of Third Degree Rape of a Child, Failure to Register as a Sex Offender, Delivery/Manufacture of Marijuana, and Assault with Intent to Cause Injury. Due to the nature of the offense as well as Gutierrez’s lengthy criminal history, the Yakima Police Department contacted the Bureau of Alcohol, Tobacco, Firearms, and Explosives.
On June 4, 2015, Gutierrez pled guilty to Brandishing of a Firearm During a Crime of Violence. Today, Senior United States District Court Judge Lonny R. Suko sentenced Gutierrez to 15 years imprisonment to be followed by 5 years of court supervision.
Michael C. Ormsby said, “The United States Attorney’s Office prosecutes aggressively those who engage in violent criminal behavior. The Yakima Police Department and the Bureau of Alcohol, Tobacco, Firearms, and Explosives worked together to successfully build a strong case. The hard work of the investigating officers/agents resulted in Gutierrez being removed from our community for the next 15 years.”
This investigation was conducted by the Yakima Police Department and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. The case was prosecuted by Tom Hanlon, an Assistant United States Attorney for the Eastern District of Washington.
Westlake cardiologist convicted of overbilling for $7 million worth of unnecessary proceduresRead the Press Release
A Westlake cardiologist was convicted of performing unnecessary catheterizations, tests, stent insertions and causing unnecessary coronary artery bypass surgeries as part of a scheme to overbill Medicare and other insurers by $7.2 million, law enforcement officials said.
Dr. Harold Persaud, 56, was convicted of one count of health care fraud, 13 counts of making false statements and one count of engaging in monetary transactions in property derived from criminal activity. He was acquitted on one count of making a false statement.
“The evidence presented at this trial was troubling,” said U.S. Attorney Steven M. Dettelbach. “Inflating Medicare billings alone would be bad enough. Falsifying cardiac care records, making an unnecessary referral for open heart surgery and performing needless and sometimes invasive heart tests and procedures is inconsistent with not only federal law but a doctor’s basic duty to his patients.”
“This doctor violated the sacred trust between doctor and patient by ordering unnecessary tests, procedures and surgeries to line his pockets,” said Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland Office. “He ripped off taxpayers and put patients’ lives at risk.”
“Medical providers have a duty and obligation to provide only those services that are medically necessary and are in the best interests of the patients under their care,” said Lamont Pugh III, Special Agent in Charge, U.S. Department of Health & Human Services, Office of Inspector General – Chicago Region. “This conduct shows a disregard for patient needs in exchange for financial gain at taxpayer expense. The OIG will continue to work with our law enforcement and prosecutorial partners to identify fraudulent health care schemes and hold individuals accountable for their actions.”
Persaud had a private medical practice at 29099 Health Campus Drive in Westlake and had hospital privileges at Fairview Hospital, St. John’s Medical Center and Southwest General Hospital, according to court documents and trial testimony.
Persaud devised a scheme to defraud and obtain money from Medicare and other insurers. The scheme took place between Feb. 16, 2006, through June 28, 2012. According to according to court documents and trial testimony, his activities in furtherance of the scheme included:
- Persaud selected the billing code for each customer submitted to Medicare and private insurers, and used codes that reflected a service that was more costly than that which was actually performed;
- Persaud performed nuclear stress tests on patients that were not medically necessary;
- He knowingly recorded false results of patients’ nuclear stress tests to justify cardiac catheterization procedures that were not medically necessary;
- Persaud performed cardiac catheterizations on patients at the hospitals and falsely recorded the existence and extent of lesions (blockage) observed during the procedures;
- He recorded false symptoms in patient records to justify testing and procedures on patients;
- Persaud inserted cardiac stents in patients who did not have 70 percent or more blockage in the vessel that he stented and who did not have symptoms of blockage;
- He placed a stent in a stenosed artery that already had a functioning bypass, thus providing no medical benefit and increasing the risk of harm to the patient;
- He improperly referred patients for coronary artery bypass surgery when there was no medical necessity for such surgery, which benefitted Persaud by increasing the amount of follow-up testing he could perform and bill to Medicare and private insurers;
- Persaud performed medically unnecessary stent procedures, aortograms, renal angiograms and other procedures and tests.
As a result of this scheme, Persaud overbilled and caused the overbilling of Medicare and private insurers in the amount of approximately $7.2 million, of which Medicare and the private insurers paid approximately $1.5 million, according to the indictment.
This case is being prosecuted by Assistant U.S. Attorneys Michael L. Collyer and Chelsea Rice following an investigation by the Federal Bureau of Investigation and the U.S. Department of Health and Human Services – Office of Inspector General
Wellpinit Man, the Last of Three Individuals Involved in a Violent Assault, Sentenced to PrisonRead the Press Release
Spokane – Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that that the last of three individuals involved in a drug-related violent assault was sentenced on September 22, 2015. Darryl Russell Flett (aka Darryl Carden), age 21, of Wellpinit, Washington, was sentenced after having previously pleaded guilty on April 13, 2015 to one count of Assault with a Dangerous Weapon in Indian Country. United States District Judge Salvador Mendoza sentenced Flett to a 24-month term of imprisonment, to be followed by three years of court supervision after he is released from Federal prison.
According to information disclosed during the court proceedings, in August 2012, Melissa Suszka solicited others to assault a victim to whom she had previously provided prescription pills. Suszka had inadvertently given the victim more pills than she intended, and the victim refused to return them when Suszka confronted him. Suszka then solicited the assault. Flett was one of several individuals that actually carried out the assault.
This case follows the previous sentencing’s of Richard Peone, who was sentenced to 39 months in 2014, and Melissa E. Suszka, who was sentenced to 37 months in August, 2015, for their participation in the assault.
Michael C. Ormsby stated, “The United States Attorney’s Office for the Eastern District of Washington is, and will continue to be, committed to prosecute aggressively violent assaults that occur within federal jurisdiction, including the Indian reservations in this District. I cannot be more clear -- drug-related violence will not be tolerated.”
This investigation was conducted by FBI and the Spokane Tribal Police Department. The case was prosecuted by Rudy J. Verschoor, an Assistant United States Attorney for the Eastern District of Washington.
Waldorf Man Pleads Guilty to Distribution of Child PornographyRead the Press Release
Greenbelt, Maryland – Richard Spivey, age 52, of Waldorf, Maryland, pleaded guilty today to distribution of child pornography. After Spivey’s guilty plea, U.S. District Judge George J. Hazel ordered that he be immediately detained and Spivey was taken into custody.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation.
According to Spivey’s plea agreement, between January 29 and 30, 2014, Spivey used a file sharing program to distribute over 2,000 files depicting children engaged in sexually explicit conduct. A search warrant was executed at Spivey’s residence on June 18, 2014, and law enforcement seized numerous electronic devices, including a desktop computer, a laptop computer and two external hard drives. A forensic review of the electronic devices found thousands of image files and hundreds of movie files containing child pornography. Some of the files portrayed sadistic and masochistic conduct and other depictions of violence, as well as images of infants and toddlers.
In addition, law enforcement found videos on Spivey’s electronic devices that he produced, depicting a prepubescent female in different stages of undress. Spivey admitted that he surreptitiously recorded the child while she was undressing, using a hidden camera. These videos constitute child pornography. Finally, Spivey also admitted surreptitiously producing videos of an adult female, while that person was in the bathroom in various stages of undress.
As part of his plea agreement, Spivey must register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).
Spivey and the government have agreed that if the Court accepts the plea agreement Spivey will be sentenced to between 150 and 240 months in prison, followed by a lifetime of supervised release. U.S. District Judge George J. Hazel has scheduled sentencing for January 25, 2016 at 2:00 p.m.
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.justice.gov/psc. For more information about internet safety education, please visit www.justice.gov/psc and click on the "resources" tab on the left of the page.
United States Attorney Rod J. Rosenstein commended the FBI, for its work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Nicolas A. Mitchell and Kristi A. O’Malley, who are prosecuting the case.
Ville Platte man sentenced to 70 months in prison for possessing, receiving child pornographyRead the Press Release
LAFAYETTE, La. – United States Attorney Stephanie A. Finley announced that a Ville Platte man was sentenced Thursday to 70 months in prison for possessing and receiving more than a thousand images of child pornography using an internet file sharing program.
Bradley Smith, 60, of Ville Platte, La., was sentenced by U.S. District Judge Elizabeth E. Foote on two counts of possession of child pornography and three counts of receiving child pornography. He was also sentenced to 10 years of supervised release and ordered to register as a sex offender. A federal jury found Smith guilty after deliberating for 40 minutes after a two-day trial that ended on July 14, 2015. Evidence admitted at trial revealed that in September of 2012, law enforcement detected Smith using an internet file sharing program to download child pornography. The software is used to trade files on the internet among its members. Law enforcement searched Smith’s residence on September 24, 2012 and seized his computer and computer hard drives. After a forensic examination of the hardware, a total of 40 videos and 1,100 images of child pornography were found.
The FBI and Louisiana State Police conducted the investigation. Assistant U.S. Attorneys John Luke Walker and Robert C. Abendroth prosecuted the case.
This case is part of Project Safe Childhood, a U.S. Department of Justice nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Those concerned may also leave tips with the FBI at tips.fbi.gov. Tips may be submitted anonymously. The Lafayette FBI office number is (337) 232-2164.
U.S. Attorney’s office urges public to participate in Drug Take-Back DriveRead the Press Release
SHREVEPORT, LAFAYETTE, MONROE, ALEXANDRIA, LAKE CHARLES, La. – United States Attorney Stephanie A. Finley urges the public to get out this weekend and throw out unused prescription drugs.
The Drug Enforcement Administration (DEA) and more than 4,200 national, tribal and community law enforcement partners nationwide promote National Prescription Drug Take-Back Day with events all across the nation this weekend. The National Prescription Drug Take-Back Day aims to provide a safe, convenient and responsible means of disposing of prescription drugs, while also educating the general public about the potential for abuse of medications. Unused medications in homes create a public health and safety concern because they are highly susceptible to accidental ingestion, theft, misuse and abuse. The DEA reports that almost twice as many Americans (6.8 million) currently abuse prescription drugs than the number of those using cocaine, hallucinogens, heroin and inhalants combined, according to the 2012 National Survey on Drug Use and Health. More Americans died in 2010 from overdoses of prescription medications (22,134, including 16,651 from narcotic painkillers) than from motor vehicle accidents, says the Centers for Disease Control and Prevention. Studies show that the majority of abused prescription drugs are obtained from family and friends, including from the home medicine cabinet.
“Rates of prescription drug abuse in the United States are alarmingly high,” Finley stated. “The DEA reported that last April that Americans turned in 2,411 tons of prescription drugs, and since the DEA’s first National Drug Take-Back event in September of 2010, consumers have disposed of more than 4.8 million pounds of unwanted medication.”
The DEA will have collection sites across the country on Saturday, September 26th, for those who are interested in bringing their unused or expired prescription drugs for proper disposal. Only pills and other solids, like patches, can be brought to the collection sites – liquids and needles or other sharp objects will not be accepted. The service is free and anonymous, no questions asked.
Prescription drugs can be dropped off from 10 a.m. to 2 p.m., Saturday, at the following sites:
Shreveport
- Caddo Parish Sheriff’s Office, 8910 Jewella Avenue,
Bossier City
- Bossier Parish Sheriff’s Office Viking Drive Substation, 2510 Viking Drive,
- Louisiana State Police Troop G office, 5300 Industrial Drive, Extended,
Monroe
- Monroe Police Department, 700 Wood St.,
- Louisiana State Police Troop F office, 1240 Highway 594,
Alexandria
- Louisiana State Police Troop E office, 1710 Odom St.,
Broussard
- Broussard Police Department at Walgreen’s Parking Lot, 105 St. Nazaire,
Lake Charles
- Lake Charles Police Department at the Lake Charles Civic Center Parking Lot, 900 Lakeshore Drive,
- Louisiana State Police Troop D office, 805 Main St.,
The public can also find a nearby collection site by visiting www.dea.gov, clicking on the “Got Drugs?” icon, and following the links to a database where they enter their zip code or they can call 800-882-9539.
U.S. Attorney urges Western District residents to register to voteRead the Press Release
SHREVEPORT, LAFAYETTE, MONROE, ALEXANDRIA, LAKE CHARLES, La. – United States Attorney Stephanie A. Finley urged residents of the Western District of Louisiana to register to vote in observance of National Voter Registration Day.
National Voter Registration Day (NVRD) is dedicated to ensuring every American is registered to vote at their current address in time for the next election. National Voter Registration Day is celebrated on the fourth Tuesday of every September by thousands of volunteers, celebrities, organizations, businesses and elected officials from all over the country. More than 600 voter registration events were hosted nationwide as part of this year’s NVRD. To find out more about NVRD, visit nationalvoterregistrationday.org.
In Louisiana, registering can be done in person, by mail or online and is open throughout the year. Registration to be eligible to vote in the October 24th election has ended, but registration to be eligible to vote in the November 21st election is open until October 22nd. Eligibility to register to vote in an election ends 30 days before that election. To find out more, call the Louisiana Secretary of State’s Office at 225-922-0900.
Upcoming elections for Louisiana are October 24th for the primary and November 21st for general. Early voting is October 10th to October 17th (except Sunday) from 8:30 a.m. to 6 p.m. for the October 24th primary election, and November 7th to November 14th (except Sunday) from 8:30 a.m. to 6 p.m. for the November 21st general election. Residents should contact their local Registrar of Voters’ Office to determine their voting location. Download a sample ballot or obtain other election information by visiting the Louisiana Secretary of State’s web page at www.sos.la.gov/ElectionsAndVoting.
“The right to vote is essential to maintaining our system of democracy,” Finley stated. “One of the Department of Justice’s most sacred responsibilities is ensuring access to the ballot box for every eligible American in the Western District of Louisiana.”
Federal law protects against such crimes as intimidating or bribing voters, buying and selling votes, altering vote tallies, stuffing ballot boxes and marking ballots for voters against their wishes or without their input.
Complaints of election fraud or voting rights violations should be directed to the FBI, who will have special agents available in each field office and resident agency throughout the country to receive allegations. The local FBI field offices can be reached by the public at the following telephone numbers: Shreveport at 318-861-1890, Lafayette at 337-233-2164, Monroe at (318) 387-0773, Alexandria at (318) 443-5097 and Lake Charles at (337) 433-6353. For a complete list of FBI field offices in Louisiana visit www.fbi.gov/neworleans/contact-us/territory-jurisdiction. The U.S. Attorney’s Office can be reached by the public at 318-676-3600 (Shreveport) or 337-262-6618 (Lafayette).
Complaints about ballot access problems or discrimination can also be made directly to the Civil Rights Division=s Voting Section in Washington, D.C., at 1-800-253-3931 or 202-307-2767. The division’s email address is [email protected], and voter complaints also can be filed online at www.justice.gov/crt/complaint/votintake.
The Civil Rights Division=s Voting Section enforces six federal statutes. They are the Civil Rights Act, the Voting Rights Act of 1965, the Voting Accessibility for the Elderly and Handicapped Act of 1984, the Uniformed and Overseas Citizens Absentee Voting Act of 1986, the National Voter Registration Act of 1993, and the Help America Vote Act of 2002. For more information on the acts that the division enforces, visit www.justice.gov/crt/about/vot/overview.php.
U.S. Attorney Promotes National Prescription Drug Take-Back DayRead the Press Release
SYRACUSE, NEW YORK – The United States Drug Enforcement Administration (DEA) will sponsor drop off sites where unused and unneeded prescription drugs can be disposed of by the public at locations all over the United States on Saturday September 26, 2015 from 10 am to 2 pm as part of National Prescription Drugs Take-Back Day, announced United States Attorney Richard S. Hartunian and DEA Resident Agent In Charge James Burns. Unused prescription drugs will be accepted at locations across the nation.
"This is a safe and convenient way to dispose of unneeded prescription drugs," said United States Attorney Hartunian.
This is the tenth DEA prescription drug take back. The last time the DEA accepted unused prescription drugs in November 2014, the public dropped off over 309 tons of unused pharmaceuticals.
Locations where unused prescription can be dropped off may be found at:
http://www.deadiversion.usdoj.gov/drug_disposal/index.html
U.S. Attorney and Dea Announce Take-Back Initiative to Safely Remove Prescription Pills from Local HomesRead the Press Release
Fifty-five locations this Saturday where Kentuckiana residents can safely and anonymously rid their homes of unwanted and expired medications
LOUISVILLE, Ky. – Kentuckiana residents have an opportunity this Saturday to safely and anonymously rid their homes of unused, unwanted, unneeded, or expired prescription medications, today announced U.S. Attorney John E. Kuhn, Jr. and U.S. Drug Enforcement Administration (DEA) Assistant Special Agent in Charge, Thomas J. Gorman. The 10th National Prescription Take-Back Day, held during the past five years, will take place this Saturday, September 26, 2015 at 55 locations across Kentuckiana. During this one-day event, federal and local law enforcement will once again partner to increase awareness of prescription drug abuse and provide an opportunity to reduce the availability of prescription pain medications in local homes.
U.S. Attorney Kuhn and ASAC Gorman are encouraging families to clean out medicine cabinets and safely rid their homes of unwanted and expired prescription medications. Many Americans are not aware that medicines that languish in home cabinets are highly susceptible to diversion, misuse, abuse and theft. Studies show that two-thirds of all teenagers who abuse prescription narcotics first obtain the drugs from family and friends; often from their home medicine cabinet.
Further, many Americans are unsure of how to properly dispose of their unused medications and often flush them down the toilet or throw them away. This poses safety and environmental hazards.
USA Kuhn and ASAC Gorman also stated that the Take-Back is a great opportunity to begin a dialogue with children to educate them on the dangers of obtaining pharmaceuticals for illicit use.
Prior DEA Prescription Take-Backs have been extremely successful. Last year, Kentuckiana residents dramatically reduced the risk of pain pill and other medication abuses by ridding their homes of 80,073 pounds of unused prescription medications. Kentucky remains among the nation’s most medicated states.
The Prescription Drug Take-Back is part of a nationwide effort sponsored by the DEA. Containers where unwanted and expired prescription medications may be safely disposed will be at 55 locations across Kentucky, on Saturday, from 10 a.m. to 2:00 p.m. A complete list of locations and the assisting law enforcement agency may be found in the attachment, at www.dea.gov or by calling 800-882-9539.
More information on how to properly dispose of unused medicines can be found on the Food & Drug Administration website:
http://www.fda.gov/Drugs/ResourcesForYou/Consumers/BuyingUsingMedicineSafely/EnsuringSafeUseofMedicine/SafeDisposalofMedicines/ucm186187.htm
Two Texas Men Sentenced to Prison in Stolen Polysilicon CaseRead the Press Release
United States Attorney Kenyen R. Brown of the Southern District of Alabama announces that Judge Kristi K. DuBose sentenced Wasi Ismail Syed, age 38, of McKinney, Texas, to serve 24 months in prison, and sentenced Syed’s brother-in-law Shahab Uddin Mir, age 35, of Frisco, Texas, to serve 3 months in prison, and ordered them to make restitution, for their respective roles in criminal offenses involving a scheme to buy and sell stolen polysilicon and to launder the proceeds from these transactions.
Co-defendants William Short of Loxley, Alabama, George Welford of Gautier, Mississippi, and Darlene Row of Dallas, Texas, will be sentenced on October 9, 2015.
William Short and George Welford are former employees of the Mitsubishi Polysilicon manufacturing plant located in Theodore, Alabama. The plant produces exceptionally high-grade polysilicon, which is a material used in the manufacturing of computer chips that control high-tech devices from supercomputers, to hospital equipment, avionics, and weapons systems. The polysilicon produced at the Theodore plant is ultra-pure. There are only four plants in the United States, and approximately a dozen worldwide, that produce this type of high-grade polysilicon.
In late 2008, Short and Welford began stealing polysilicon rods from the Mitsubishi plant. Using reinforced backpacks and lunch pails, Short and Welford walked several rods per day out of the plant and into their vehicles. Before long, Short and Welford had stolen so much polysilicon that they needed a storage unit, and ultimately a warehouse to house the stolen material. Since the rods were stolen very shortly after coming out of the reactors, they were not etched or vacuum-sealed in a clean room like the finished rods coming out of the plant. Consequently, the rods lacked the normal specification sheets that are attached to the packaging.
Soon after they started stealing the polysilicon rods, Short and Welford began looking for a purchaser. Using the aliases William Smith (Short) and Butch Cassidy (Welford), the pair found Horizon Silicon online. The Dallas, Texas-based company was owned and operated by brothers-in-law Wasi Syed and Shahab Mir, and Darlene Row worked as a secretary.
Short and Welford negotiated with Syed and Row for the price and amount of polysilicon to be sold. During the course of the initial negotiations, Syed flew to Pensacola, Florida, to see the polysilicon for himself. This meeting, in which Syed tested the polysilicon with a resistivity meter to check its purity level, occurred at night in a Krystal’s parking lot.
After testing the buckets of polysilicon, Syed agreed to buy the polysilicon from Short and Welford for a price well below the market value. One condition of the deal was that payments were to be made in cash and in person.
Between February 2009 and March 2014, Short and Welford stole, and then subsequently sold, approximately 40 metric tons of Mitsubishi polysilicon rods to Syed. Typically, Syed would find a buyer for the polysilicon he was purchasing from Short and Welford, then Row would arrange for the polysilicon to be picked up and delivered to a port city on the west coast. Finally, Mir would fly or drive to Mobile, Alabama, and other locations along the Gulf Coast, with either backpacks or suitcases full of cash to pay Short and Welford.
The stolen polysilicon, valued at approximately $2.4 million, was exported from the United States after Syed sold the polysilicon to other buyers. While the final destination for all of the stolen polysilicon rods is not clear, at least some of the material ended up in the People’s Republic of China.
In early 2014, Short and Welford were caught by Mitsubishi. Syed, Mir, and Row were subsequently arrested in Texas in May 2014.
This matter was investigated by Homeland Security Investigations and IRS-Criminal Investigations in Mobile, Alabama, with assistance from the Dallas, Texas office of these agencies. The case was prosecuted by Donna B. Dobbins and Christopher J. Bodnar, Assistant United States Attorneys with the U.S. Attorney’s Office for the Southern District of Alabama.
Two Postal Service Contract Employees Sentenced for Mail TheftsRead the Press Release
Jacksonville, Florida – U.S. District Judge Timothy J. Corrigan today sentenced Jacksonville residents Victor Antinio Burks (28) and Yamil Sanchez (33) for stealing mail from a U.S. Postal Service contract facility. Burks was sentenced to 79 days’ imprisonment, to be followed by two years of supervised release and 100 hours of community service. Sanchez was sentenced to two years’ probation, a $500 fine, and 100 hours of community service. Both individuals pleaded guilty in June 2015.
According to court documents, Burks and Sanchez worked at a Jacksonville mail distribution facility operated by a contractor for the U.S. Postal Service. Between March and November 2014, Burks stole numerous items from the mail including 7 televisions, a tablet computer, 15-20 cellphones, 20-25 purses, and a videogame console. He admitted to agents that he had pawned the televisions and the tablet, and sold the rest of the items, estimating that he had made about $2,500 to $3,000.
Sanchez stole items from the mail for about two years, ending in the summer of 2014. He admitted that he had stolen a laptop computer, a compound bow, and a set of golf clubs, all of which he pawned. Sanchez also admitted to stealing a television that he later sold at a flea market.
This case was investigated by the U.S. Postal Service Office of Inspector General. It is being prosecuted by Assistant United States Attorney Arnold B. Corsmeier.
Three Members of Violent Minneapolis-Based Gangs Indicted on Federal Firearms ChargesRead the Press Release
United States Attorney Andrew M. Luger today announced a federal indictment charging three members of the Minneapolis-based Taliban gang and the Young N’ Thuggin’ (YNT) gang. All three defendants were charged with conspiracy to possess firearms and ammunition, ROBERT WINFIELD ANDERSON, a/k/a “Rob Moe,” 26, and ROBERT LEVELLE FRELIX, a/k/a “Lil Rob,” 24, were charged with possession of firearms and ammunition by a felon, and SHANE JAMAL JACKSON, a/k/a “Sunny,” 23, was charged with possession of firearms by a felon. All three defendants made their initial appearances yesterday before U.S. Magistrate Judge Steven E. Rau. Detention hearings are set for Monday morning.
According to the indictment and documents filed in court, from at least June 2011 through at least June 2015, the defendants participated in the activities of two closely associated street gangs, the Taliban and the YNT (“Taliban/YNT”). The Taliban/YNT are organized for the purpose of making money for the gang members by trafficking in illegal drugs, armed robberies and thefts. In addition to making money through criminal activity, the purpose of the Taliban/YNT is to obtain and use firearms. All three defendants have prior felony offenses that make them ineligible to possess firearms.
According to the indictment and documents filed in court, an ongoing gang war between the Taliban/YNT and their rivals, the 1-9 Dipset and Stick Up Boys gangs, has resulted in the shooting deaths of numerous gang members on both sides of the conflict. Due to the ongoing gang war, and the need for weapons to conduct other illegal activity, the three defendants and other members of the Taliban/YNT conspired to illegally obtain and jointly possess firearms. As an example, on September 21, 2014, FRELIX, JACKSON and another gang member engaged in a gun battle with rival gang members near 24th Street and Aldrich Avenue in North Minneapolis. Following the shootout, law enforcement recovered one Glock .40 caliber pistol and two Glock 9mm pistols from the scene.
This indictment is the result of an investigation conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives, Minneapolis Police Department, Hennepin County Sheriff’s Office and the Safe Streets Task Force.
This case is being prosecuted by Assistant U.S. Attorney David P. Steinkamp.
Defendant Information:
ROBERT WINFIELD ANDERSON, a/k/a “Rob Moe,” 26
Minneapolis, MN
Charges:
- Conspiracy – Felon in Possession of Firearms and Ammunition, 1 count
- Felon in Possession of a Firearm, 3 counts
- Felon in Possession of Ammunition, 1 count
ROBERT LEVELLE FRELIX, a/k/a “Lil Rob,” 24
Minneapolis, MN
Charges:
- Conspiracy – Felon in Possession of Firearms and Ammunition, 1 count
- Felon in Possession of a Firearm, 3 counts
- Felon in Possession of Ammunition, 1 count
SHANE JAMAL JACKSON, a/k/a “Sunny,” 23
Unknown
Charges:
- Conspiracy – Felon in Possession of Firearms and Ammunition, 1 count
- Felon in Possession of a Firearm, 1 count
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
The charges contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Thomas Keith of Bennington Sentenced to 41 Months on Heroin and Cocaine ChargesRead the Press Release
The Office of the United States Attorney for the District of Vermont stated that Thomas Keith, 42, of Bennington, Vermont, was sentenced on September 24, 2015 in United States District Court in Rutland to 41 months in prison and three years of supervised release. Keith also forfeited $1,084 in connection with his drug distribution activities. This sentence followed Keith’s conviction on one count of conspiracy to possess with intent to distribute heroin and cocaine, and one count of possession with intent to distribute heroin. U.S. District Judge Geoffrey W. Crawford also ordered Keith to pay a $200 special assessment. In March 2011, law enforcement intercepted a package addressed to Keith that contained approximately 367 grams of cocaine and 80 grams of heroin. Subsequently, as part of a Vermont Drug Task Force investigation, law enforcement conducted three controlled purchases of heroin from Keith in April and May 2014. Law enforcement executed a search warrant at Keith’s Bennington residence on May 16, 2014, finding 75 bags of heroin, drug paraphernalia, and $1,084 in cash. This matter was investigated by the Vermont Drug Task Force, with the assistance of the U.S. Drug Enforcement Administration, Homeland Security Investigations, the Bennington Police Department, the Bennington County Sheriff’s Department, the Vermont Department of Liquor Control, and the Vermont Department of Motor Vehicles. Assistant U.S. Attorney Kevin J. Doyle handled the prosecution in this matter. Keith was represented by Assistant Federal Defender Elizabeth K. Quinn.Third Person Sentenced in Las Vegas for International Biofuel Fraud ConspiracyRead the Press Release
Alex Jariv, 28, of Las Vegas, Nevada, was sentenced today in federal court to 30 months in prison and three years of supervised release for his role in illegal schemes to generate and sell fraudulent biodiesel credits, marking the culmination of nearly four years of investigations and prosecutions for this complex international fraud scheme. Alex Jariv pleaded guilty to one count of conspiracy to commit wire fraud, make false statements and launder monetary instruments. Jariv was ordered to forfeit $491,061 in previously seized cash, an SUV, real estate and the contents of several bank accounts in the United States and abroad that were some of his proceeds of the conspiracy.
Alex Jariv is the third person to be sentenced for their role in the scheme. James Jariv, 64, of Las Vegas, Nevada, was sentenced in August to ten years in prison for his role in the illegal schemes to generate fraudulent biodiesel credits and for his role in exporting biodiesel without providing biodiesel credits to the United States. James Jariv was also ordered to make restitution in the amount of $6,345,830 and to forfeit between $4 to $6 million in cash and other assets.
Nathan Stoliar, 64, of Australia, was sentenced to two years in prison in April for his role in both conspiracies and ordered to pay more than $1.4 million in restitution and to forfeit of $4 million in cash. James Jariv and Stoliar both pleaded guilty to one count of conspiracy, one count of conspiracy to engage in money laundering, two counts of wire fraud and one count of making false statements under the Clean Air Act.
“We simply will not tolerate and will vigorously prosecute schemes like this one, that defraud a program designed to strengthen our nation’s petroleum independence and improve our air quality,” said Assistant Attorney General John C. Cruden for the Justice Department’s Environment and Natural Resources Division.
“Mr. Jariv is the third defendant sentenced to prison in this complex and egregious scheme to defraud fuel suppliers and the United States,” said U.S. Attorney Daniel Bogden for the District of Nevada. “Through the tenacious work of our investigators and prosecutors, we also were able to seize and forfeit millions of dollars from numerous bank accounts, as well as real property in Nevada and California, jewelry and other assets.”
“The Renewable Fuel Standard helps reduce the nation’s impact on climate change and lessens our dependence on foreign oil and this case shows that EPA takes seriously its responsibility to bring violators of this important program to justice,” said Special Agent Jay Green, Special Agent in Charge of EPA’s criminal enforcement program in Nevada. “In order to ensure a level playing field, it’s vital that companies following the law don’t have to compete with those that break it.”
The Energy Independence and Security Act of 2007 created a number of federally-funded programs that provided monetary incentives for the production and use of renewable fuels such as biodiesel in the United States. Biodiesel producers and importers can generate and attach credits known as renewable identification numbers (RINs) to the gallons of biodiesel they produce or import. Because certain companies, such as companies that sell transportation fuel in the United States, need RINs to comply with regulatory obligations, RINs have significant market value. They are routinely bought and sold in the marketplace.
Beginning around September of 2009, James Jariv and Stoliar operated and controlled a company – City Farm Biofuel in Vancouver, British Columbia, Canada – that represented itself as a producer of biodiesel from “feedstocks” such as animal fat and vegetable oils. James Jariv and Stoliar also formed a company called Canada Feedstock Supply – that represented itself as City Farm’s supplier of feedstocks necessary to produce biodiesel. James Jariv operated and controlled a company based in Las Vegas called Global E Marketing (GEM).
Alex Jariv worked for and on behalf of these companies. Using these three and other closely-held companies, the three defendants claimed to produce biodiesel at the City Farm facility and to import and sell biodiesel to GEM and then generated and sold RINs based upon this claimed production, sale and importation. In reality, no biodiesel produced at City Farm was ever imported and sold to GEM as claimed. The Jarivs and Stoliar used GEM to claim to blend the biodiesel with petroleum diesel, allowing them to sell the RINs separately from any actual biodiesel. Using this scheme, the three men falsely claimed to import, purchase and blend more than 4.2 million gallons of biodiesel. They then sold the RINs, and fraudulently generated more than $7 million.
James Jariv and Stoliar also purchased and resold RIN-less B-99 biodiesel as B-100 biodiesel, which allowed them to charge substantially more for this product than if it has been accurately labeled. They exported significant amounts of the RIN-less B-99 they bought in the United States to Canada and Australia. They then sold the biodiesel in those countries and conspired to not acquire and provide RINs to the United States for these exports as they were required to do by law. In doing so, James Jariv and Stoliar failed to give to the United States RINs worth in excess of $34 million, keeping this money for themselves instead.
Finally, James and Alex Jariv and Stoliar conspired to launder the proceeds of their crimes, utilizing foreign banking institutions and complex financial transactions to promote their illegal schemes and distribute the proceeds of their crimes. Accounts were utilized in Canada, Nevada and Australia and transactions between the defendants’ closely-held companies were described as other legitimate transactions involving biodiesel, when in reality they were not.
The investigation into the Jarivs’ and Stoliar’s activities was the result of collaborative work by the EPA’s Criminal Investigation Division and the FBI, with assistance from the United States Secret Service, the Internal Revenue Service-Criminal Investigations, the Department of Homeland Security and the Royal Canadian Mounted Police.
The case was prosecuted by Wayne D. Hettenbach of the Environmental Crimes Section, U.S. Department of Justice, Assistant U.S. Attorneys Crane M. Pomerantz and Daniel D. Hollingsworth of the U.S. Attorney’s Office in Nevada and Assistant Deputy Chief Darrin L. McCullough of the Justice Department’s Criminal Division, Asset Forfeiture and Money Laundering Section, with the assistance of the Justice Department’s Office of International Affairs and the U.S. Attorney’s Office for the Southern District of Texas.
Third Person Sentenced in Las Vegas for International Biofuel Fraud ConspiracyRead the Press Release
WASHINGTON – Alex Jariv, 28, of Las Vegas, Nevada, was sentenced today in federal court to 30 months in prison and three years of supervised release for his role in illegal schemes to generate and sell fraudulent biodiesel credits, marking the culmination of nearly four years of investigations and prosecutions for this complex international fraud scheme. Alex Jariv pleaded guilty to one count of conspiracy to commit wire fraud, make false statements and launder monetary instruments. Jariv was ordered to forfeit $491,061 in previously seized cash, an SUV, real estate and the contents of several bank accounts in the United States and abroad that were some of his proceeds of the conspiracy.
Alex Jariv is the third person to be sentenced for their role in the scheme. James Jariv, 64, of Las Vegas, Nevada, was sentenced in August to ten years in prison for his role in the illegal schemes to generate fraudulent biodiesel credits and for his role in exporting biodiesel without providing biodiesel credits to the United States. James Jariv was also ordered to make restitution in the amount of $6,345,830 and to forfeit between $4 to $6 million in cash and other assets.
Nathan Stoliar, 64, of Australia, was sentenced to two years in prison in April for his role in both conspiracies and ordered to pay more than $1.4 million in restitution and to forfeit of $4 million in cash. James Jariv and Stoliar both pleaded guilty to one count of conspiracy, one count of conspiracy to engage in money laundering, two counts of wire fraud and one count of making false statements under the Clean Air Act.
“We simply will not tolerate and will vigorously prosecute schemes like this one, that defraud a program designed to strengthen our nation’s petroleum independence and improve our air quality,” said Assistant Attorney General John C. Cruden for the Justice Department’s Environment and Natural Resources Division.
“Mr. Jariv is the third defendant sentenced to prison in this complex and egregious scheme to defraud fuel suppliers and the United States,” said U.S. Attorney Daniel Bogden for the District of Nevada. “Through the tenacious work of our investigators and prosecutors, we also were able to seize and forfeit millions of dollars from numerous bank accounts, as well as real property in Nevada and California, jewelry and other assets.”
“The Renewable Fuel Standard helps reduce the nation’s impact on climate change and lessens our dependence on foreign oil and this case shows that EPA takes seriously its responsibility to bring violators of this important program to justice,” said Special Agent Jay Green, Special Agent in Charge of EPA’s criminal enforcement program in Nevada. “In order to ensure a level playing field, it’s vital that companies following the law don’t have to compete with those that break it.”
The Energy Independence and Security Act of 2007 created a number of federally-funded programs that provided monetary incentives for the production and use of renewable fuels such as biodiesel in the United States. Biodiesel producers and importers can generate and attach credits known as renewable identification numbers (RINs) to the gallons of biodiesel they produce or import. Because certain companies, such as companies that sell transportation fuel in the United States, need RINs to comply with regulatory obligations, RINs have significant market value. They are routinely bought and sold in the marketplace.
Beginning around September of 2009, James Jariv and Stoliar operated and controlled a company – City Farm Biofuel in Vancouver, British Columbia, Canada – that represented itself as a producer of biodiesel from “feedstocks” such as animal fat and vegetable oils. James Jariv and Stoliar also formed a company called Canada Feedstock Supply – that represented itself as City Farm’s supplier of feedstocks necessary to produce biodiesel. James Jariv operated and controlled a company based in Las Vegas called Global E Marketing (GEM).
Alex Jariv worked for and on behalf of these companies. Using these three and other closely-held companies, the three defendants claimed to produce biodiesel at the City Farm facility and to import and sell biodiesel to GEM and then generated and sold RINs based upon this claimed production, sale and importation. In reality, no biodiesel produced at City Farm was ever imported and sold to GEM as claimed. The Jarivs and Stoliar used GEM to claim to blend the biodiesel with petroleum diesel, allowing them to sell the RINs separately from any actual biodiesel. Using this scheme, the three men falsely claimed to import, purchase and blend more than 4.2 million gallons of biodiesel. They then sold the RINs, and fraudulently generated more than $7 million.
James Jariv and Stoliar also purchased and resold RIN-less B-99 biodiesel as B-100 biodiesel, which allowed them to charge substantially more for this product than if it has been accurately labeled. They exported significant amounts of the RIN-less B-99 they bought in the United States to Canada and Australia. They then sold the biodiesel in those countries and conspired to not acquire and provide RINs to the United States for these exports as they were required to do by law. In doing so, James Jariv and Stoliar failed to give to the United States RINs worth in excess of $34 million, keeping this money for themselves instead.
Finally, James and Alex Jariv and Stoliar conspired to launder the proceeds of their crimes, utilizing foreign banking institutions and complex financial transactions to promote their illegal schemes and distribute the proceeds of their crimes. Accounts were utilized in Canada, Nevada and Australia and transactions between the defendants’ closely-held companies were described as other legitimate transactions involving biodiesel, when in reality they were not.
The investigation into the Jarivs’ and Stoliar’s activities was the result of collaborative work by the EPA’s Criminal Investigation Division and the FBI, with assistance from the United States Secret Service, the Internal Revenue Service-Criminal Investigations, the Department of Homeland Security and the Royal Canadian Mounted Police.
The case was prosecuted by Wayne D. Hettenbach of the Environmental Crimes Section, U.S. Department of Justice, Assistant U.S. Attorneys Crane M. Pomerantz and Daniel D. Hollingsworth of the U.S. Attorney’s Office in Nevada and Assistant Deputy Chief Darrin L. McCullough of the Justice Department’s Criminal Division, Asset Forfeiture and Money Laundering Section, with the assistance of the Justice Department’s Office of International Affairs and the U.S. Attorney’s Office for the Southern District of Texas.
Texas Man Sentenced to 10 Years in Prison for Attempting to Provide Material Support to TerroristsRead the Press Release
Rahatul Ashikim Khan, 24, of Round Rock, Texas, was sentenced to 10 years in prison followed by 10 years of supervised release for attempting to provide material support and resources to terrorists.
Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Richard L. Durbin Jr. of the Western District of Texas and Special Agent in Charge Christopher H. Combs of the FBI’s San Antonio Division made the announcement.
On July 2, 2014, Khan pleaded guilty to conspiracy to provide material support to terrorists. The conspiracy occurred between March 2011 and January 2012. During this time frame, Khan identified an individual in an Internet chatroom and began assessing that individual for overseas violent jihadist travel. That individual was actually an FBI confidential source. After Khan screened the confidential source, he made arrangements to insert him into an al-Shabaab pipeline controlled by Gufran Ahmed Kauser Mohammed and Mohamed Hussen Said. Mohammed and Said both pleaded guilty to material support offenses in the Southern District of Florida and have been sentenced to terms of 15 years’ imprisonment respectively.
According to court records, Khan also led a group of individuals in the Austin, Texas, area who pledged loyalty to the now-deceased Taliban and terrorist leader, Mullah Omar. Michael Todd Wolfe, 24, was a part of Khan’s group. Wolfe was arrested by FBI agents on June 17, 2014 in Houston, as he was about to board a plane as a first step towards his goal of joining and fighting with the Islamic State of Iraq and the Levant (ISIL). Wolfe was sentenced to 82 months in prison for attempting to provide material support to ISIL.
“Rahatul Khan conspired to provide material support to terrorists by screening and recruiting potential foreign fighters located in the United States to wage violent jihad in various locations overseas, including Somalia,” said Assistant Attorney General Carlin. “The National Security Division’s highest priority is counterterrorism and we will continue to pursue justice against those who seek to provide material support to designated foreign terrorist organizations.”
“I would like to thank the men and women serving on the Central Texas Joint Terrorism Task Force, who conducted an exceptional investigation in this case, and continue to work tirelessly, 365 days a year, to keep our community safe,” said Special Agent in Charge Combs.
This case resulted from a Central Texas Joint Terrorism Task Force investigation. The case was prosecuted by Assistant U.S. Attorneys Gregg N. Sofer and Michael Galdo of the Western District of Texas and Trial Attorneys Josh Parecki and Michael Dittoe of the National Security Division’s Counterterrorism Section.
Round Rock Man Sentenced to 10 Years in Federal Prison for Attempting to Provide Material Support to TerroristsRead the Press Release
In Austin this afternoon, 24-year-old self-proclaimed “jihadi” Rahatul Ashikim Khan (a.k.a. “Rahat Khan,” “Authentic Tauheed 19,” and “AT19”) was sentenced to ten years in federal prison followed by ten years of supervised release for attempting to provide material support and resources to terrorists, announced John Carlin, Assistant Attorney General for National Security, Richard L. Durbin, Jr., United States Attorney for the Western District of Texas, and Christopher Combs, Federal Bureau of Investigation Special Agent in Charge of the San Antonio Division.
On July 2, 2014, Khan pleaded guilty to conspiracy to provide material support to terrorists. The conspiracy occurred between March 2011 and January 2012. During this time frame, Khan identified an individual in an Internet chatroom and began assessing that individual for overseas violent jihadist travel. That individual was actually an FBI confidential source. After Khan screened the confidential source, he made arrangements to insert him into an al-Shabaab pipeline controlled by Gufran Ahmed Kauser Mohammed and Mohamed Hussen Said. Mohammed and Said both pleaded guilty to material support offenses in the Southern District of Florida and have been sentenced to terms of 180 months’ imprisonment respectively.
According to court records, Khan also led a group of individuals in the Austin area who pledged loyalty to the now-deceased Taliban and terrorist leader, Mullah Omar. Michael Todd Wolfe, 24, was a part of Khan’s group. Wolfe was arrested by FBI agents on June 17, 2014, in Houston, as he was about to board a plane as a first step towards his goal of joining and fighting with the Islamic State of Iraq and the Levant (ISIL). Wolfe was sentenced to 82 months in prison for attempting to provide material support to ISIL.
“Rahatul Khan conspired to provide material support to terrorists by screening and recruiting potential foreign fighters located in the United States to wage violent jihad in various locations overseas, including Somalia,” said Assistant Attorney General Carlin. “The National Security Division’s highest priority is counterterrorism and we will continue to pursue justice against those who seek to provide material support to designated foreign terrorist organizations.”
This case resulted from a Central Texas Joint Terrorism Task Force investigation conducted by the Federal Bureau of Investigation together with the Internal Revenue Service-Criminal Investigations, United States Citizenship and Immigration Services, United States Army Intelligence, Austin Police Department, Round Rock Police Department, Killeen Police Department, University of Texas Police Department, Travis County Sheriff’s Office, Texas Department of Public Safety, Office of the Texas Attorney General and the Texas Alcoholic Beverage Commission.
“I would like to thank the men and women serving on the Central Texas Joint Terrorism Task Force, who conducted an exceptional investigation in this case, and continue to work tirelessly, 365 days a year, to keep our community safe,” stated FBI Special Agent in Charge Christopher Combs.
Assistant United States Attorneys Gregg N. Sofer and Michael Galdo, together with Department of Justice National Security Division’s Counterterrorism Section trial attorneys Josh Parecki and Michael Dittoe, prosecuted this case on behalf of the government.
Rockwall Man Admits Producing, Transporting and Possessing Child PornographyRead the Press Release
DALLAS — Christian C. Winchel, 49, of Rockwall, Texas, appeared today before U.S. District Judge Sidney A. Fitzwater and pleaded guilty to multiple child pornography offenses involving prepubescent child pornography, announced U.S. Attorney John Parker of the Northern District of Texas.
Specifically, Winchel pleaded guilty to one count of production of child pornography; one count of transporting and shipping child pornography; and one count of possession of prepubescent child pornography. He faces a maximum statutory penalty of 70 years in federal prison and a $750,000 fine. Winchel has been in custody since his arrest on a related federal criminal complaint in early February 2015. Sentencing is set for January 15, 2016, before Judge Fitzwater.
Winchell admitted he has downloaded child pornography since approximately 1994. He thought he would be able to trade child pornography with others if he produced his own material. He had access to an 18-month-old child, and took sexually explicit photos of himself with the child. He also admitted using a spy cam to capture minor girls using the bathroom when they were in his home and a nanny cam to capture minor girls in various stages of undress in his home.
Winchell moved to Rockwall from Indiana in 2013, transporting the videos he had recorded of minor girls from Indiana to Texas. He admitted that when children visited for sleepovers at his home in Rockwall, he filmed himself engaging in sexually explicit activity while in proximity of the minor children who were asleep.
Law enforcement executed a search warrant at his home in February 2015 and seized several media items. The investigation revealed that as of August 20, 2015, there were 2700 images and videos of child pornography contained on the media examined. Through this forensic analysis, law enforcement has determined that some of the images and a video, involving an eight-year-old minor victim, were produced just over one year ago, in late July 2014. Law enforcement has found evidence that Winchel produced child pornography and images and videos of five minor victims.
Anyone who knows of someone who may have been victimized in this case is asked to contact the FBI at 972-559-5000.
The FBI’s Dallas Child Exploitation Task Force is conducting the investigation. Assistant U.S. Attorney Camille Sparks is in charge of the prosecution.
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Ringleader of $24 Million Stolen Identity Tax Refund Fraud Ring Sentenced to 15 Years in PrisonRead the Press Release
9,000 Identities Stolen from the U.S. Army, Alabama State Agencies and Georgia Companies
A resident of Newnan, Georgia, was sentenced today to prison for her role as the ringleader of a $24 million stolen identity tax refund fraud (SIRF) conspiracy, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney George L. Beck Jr. of the Middle District of Alabama.
Keisha Lanier was sentenced by U.S. District Court Judge Kristi K. DuBose of the Southern District of Alabama to serve 15 years in prison to be followed by three years of supervised release and ordered to forfeit $5,811,406. She was also detained following the sentencing hearing. On May 19, Tamika Floyd, a defendant in a related case, was sentenced to serve 87 months in prison. On June 25, Tamaica Hoskins, a co-defendant charged in the same indictment, was sentenced to serve 145 months in prison. And on Aug. 7, the following sentences were imposed on Lanier’s other co-defendants:
- Tracy Mitchell, of Phenix City, Alabama, was sentenced to serve 159 months in prison to be followed by three years of supervised release and ordered to forfeit $329,242, which was seized in cash from her residence;
- Talarius Paige, of Phenix City, was sentenced to serve 60 months in prison to be followed by three years of supervised release and ordered to pay $762,512 in restitution to the Internal Revenue Service (IRS);
- Mequetta Snell-Quick, of Columbus, Georgia, was sentenced to serve 24 months and one day in prison to be followed by two years of supervised release and ordered to pay $199,471 in restitution to the IRS;
- Latasha Mitchell, of Phenix City, was sentenced to serve 36 months in prison to be followed by two years of supervised release and ordered to pay $513,821 in restitution to the IRS;
- Dameisha Mitchell, of Phenix City, was sentenced to serve 65 months in prison to be followed by three years of supervised release and ordered to pay $440,176 in restitution to the IRS;
- Sharonda Johnson, of Phenix City, was sentenced to serve 24 months in prison to be followed by two years of supervised release and ordered to pay $440,176 in restitution to the IRS;
- Patrice Taylor, of Midland, Georgia, was sentenced to serve 12 months and one day in prison to be followed by two years of supervised release and ordered to pay $28,783 in restitution to the IRS; and
- Cynthia Johnson, of Phenix City, was sentenced to two years of probation and ordered to pay $5,047 in restitution to the IRS.
“Today’s sentence brings to a close an extensive criminal network led by Keisha Lanier and designed to victimize U.S. citizens and defraud the U.S. Treasury of over $20 million in fraudulent refund claims,” said Acting Assistant Attorney General Ciraolo. “The substantial sentences imposed on Ms. Lanier and her co-defendants send a clear message that those who chose to engage in such criminal conduct will pay a very heavy price.”
According to information in court documents and at the sentencing hearings, between January 2011 and December 2013, Lanier and Tracy Mitchell led a large-scale identity theft ring in which Lanier, Tracy Mitchell and their co-defendants filed more than 9,000 false individual federal income tax returns that claimed more than $24 million in fraudulent claims for tax refunds. The IRS paid out close to $10 million in refunds on these fraudulent claims. The defendants obtained the stolen identities from various sources, including from the U.S. Army, several Alabama state agencies, a Georgia call center and employee records from a Georgia company. Mitchell worked at the hospital located at Fort Benning, Georgia, where she had access to the identification data of military personnel, including soldiers who were deployed to Afghanistan. She stole the personal information of soldiers and used that information to file false tax returns.
“Today’s sentencing of Keisha Lanier, who conspired with others to use the identities of American service members and hospital patients to enrich themselves by stealing tax refunds, demonstrates the depths of how far criminals will stoop and the extent to which IRS-CI will go to fight identity theft,” said Chief Richard Weber of IRS-Criminal Investigation (IRS-CI). “We will use every available resource in collaboration with our law enforcement partners to combat these serious crimes.”
“This sentencing demonstrates our firm commitment to hold accountable those who commit fraud or otherwise steal from our government,” said Director Daniel Andrews of the U.S. Army Criminal Investigation Command’s (CID) Computer Crime Investigative Unit. “Special agents from our Computer Crime Investigative Unit, along with our federal law enforcement counterparts, are unwavering in our commitment to seek out and hold responsible all those who conduct criminal activity against the United States Army and the American taxpayer.”
Floyd stole personal information from two Alabama state agencies and provided those names to Lanier. Lanier provided those names to Tracy Mitchell, Latasha Mitchell, Paige and others to file false tax returns. Lanier also obtained stolen identities from the Alabama Department of Corrections. Paige and Taylor worked in a call center for a payment-processing company in Columbus and stole identities. Paige, in turn, used those identities to file false tax returns, some of which he filed from Tracy Mitchell’s residence. Tracy and Latasha Mitchell also obtained employee files from a Columbus company and used those identities to file false tax returns.
To file the false tax returns, the defendants obtained several IRS Electronic Filing Numbers in the names of sham tax businesses. On behalf of those sham tax businesses, the defendants applied for bank products from various financial institutions. Under the guise of a legitimate business account, the institutions mailed blank check stock to the defendants’ homes. The defendants directed the IRS to pay anticipated tax refunds to prepaid debit cards, in U.S. Treasury checks and to financial institutions, which in turn issued the tax refunds via prepaid debit cards or checks. When the refunds were sent through the financial institutions, the defendants simply printed out the refund checks from the check stock that had been sent to their homes.
After a period of time, the financial institutions stopped permitting the defendants to print out the tax refund checks. To continue the scheme, Tracy Mitchell and members of her family recruited U.S. Postal Service employees. The corrupt postal employees specified addresses along their postal routes to have the U.S. Treasury checks mailed, then obtained those checks and turned them over to the defendants for a fee.
The scheme also involved a complex money laundering operation. Nearly $10 million in fraudulent tax refund checks were cashed at several businesses located in Alabama, Georgia and Kentucky. To coordinate this massive check cashing scheme, the defendants communicated using text messages and maintained detailed records. For instance, Sharondra Johnson worked at the Walmart money center in Columbus, where she cashed checks for customers as part of her job. Dameisha Mitchell recruited Sharondra Johnson to cash tax refund checks that were fraudulently issued in the names of other individuals. Sharondra Johnson agreed to cash the checks and communicated with Dameisha and Tracy Mitchell via text messages. In an attempt to conceal the crime from Walmart, the defendants had multiple individuals deliver the tax refund checks to Johnson for her to cash them.
At sentencing, the government offered victim impact statements from several individuals whose identities were stolen, from family members, and from companies and governmental agencies where the identity theft breaches occurred. One agency representative noted that the identity theft was not only devastating financially, but that it also impaired the agency’s ability to serve the residents of this state. The mother of a U.S. Army soldier whose identity was stolen submitted a statement describing the consequences of the fraud on her and her family:
While [my son] was fighting for our country and all back home[,] I received a very disturbing phone call from [an] Agent [] from the IRS that my son[,] while at Ft. Benning training to defend our country[,] the land of the free[,] had his identity stolen and fraudulent tax returns were filed with his social security number. This news was devastating to think that my [] 19-year-old son[,] who was defending the very freedom this country stands [for] [,] was wronged by one of those people [he] was willing to die for. My whole family could not believe what was happening. We now had to worry about this terrible act by one of our own. As I tried my best to keep composed and handle all of the gruesome mounds of paperwork to get this straightened out with the IRS, [my son] was then denied his tax refund. This created a financial hardship on [him]. We were too afraid to tell [him] while he was deployed because we did not want to worry him and we wanted him to focus only on getting home alive and not have to worry about such an atrocious act by someone who did not even know [him].
“No sentence is too strong for those who prey on our fighting men and women,” said U.S. Attorney Beck Jr. “War is hell on the home front, too, and the family left behind holding things together must be strongly protected.”
Acting Assistant Attorney General Ciraolo and U.S. Attorney Beck Jr. commended special agents of the IRS-Criminal Investigation and the U.S. Army-CID, who investigated the case, and Trial Attorneys Michael C. Boteler and Gregory P. Bailey of the Tax Division and Assistant U.S. Attorneys Todd A. Brown, Jonathan S. Ross and Kevin P. Davidson of the Middle District of Alabama, who prosecuted the case. Ciraolo and Beck Jr. also thanked the U.S. Attorney’s Office of the Middle District of Georgia for their assistance in the case.
Private Investigator Williamson sentenced to 78 months in prison on charges in bribery caseRead the Press Release
LAFAYETTE, La. – United States Attorney Stephanie A. Finley announced today that private investigator Robert Williamson was sentenced to 78 months in prison on charges related to his role in a pay-for-plea scheme that garnered favorable treatment for defendants charged with OWI and various state crimes.
Williamson, 67, of Lafayette, was sentenced by U.S. District Judge Elizabeth E. Foote on one count of conspiracy, one count of bribery and one count of Social Security fraud. He was also sentenced to three years of supervised release and ordered to pay $77,677.20 in restitution. According to the June 8, 2015 guilty plea, Williamson, who is not licensed to practice law, was part of a conspiracy from March 2008 to February 2012 that solicited thousands of dollars from individuals with pending criminal charges in the 15th Judicial District. Williamson promised favorable resolutions to pending felony and misdemeanor cases, the majority of which were OWI cases.
Williamson paid bribes in cash and other things of value to personnel within the District Attorney=s Office for the 15th Judicial District and employees with other organizations associated with the OWI program, including Acadiana Outreach. Williamson also obtained false and fraudulent certifications from Acadiana Outreach, which certified that his clients completed court-ordered community service, when in fact the individuals had not. Williamson would obtain fraudulent driver safety training certificates showing that Williamson=s Aclients@ completed court-mandated driver improvement programs when they had not. Some of those monies were for fines, penalties and other expenses. During the course of the scheme, Williamson also received approximately $77,677.20 from the Social Security Administration that he was not entitled to receive.
“The public good was circumvented by the greed and lies perpetrated by Williamson and his associates,” Finley stated. “People who should have been dissuaded from drunk driving by receiving jail time and other penalties were instead given a pass to endanger lives again and again. The damage that this conspiracy has wrought cannot be quantified. We hope that this sentence brings an end to this type of practice and serves as a warning to anyone who would try to conduct a similar scam and circumvent the legal process.”
Co-defendants Barna D. Haynes, 61; Greg Williams, 47; and Sandra Degeyter, 64, all of Lafayette, were sentenced July 10, 2015 by U.S. District Judge Elizabeth E. Foote on one count of conspiracy to commit bribery. Co-defendants Denease Curry, 49, of Broussard, and Elaine Crump, 62, of Lafayette, were also sentenced by Foote July 10, 2015 on one count of misprision of a felony for failure to report bribes offered and received by employees of the 15th Judicial District Attorney’s Office. Haynes received 18 months in prison and a $5,000 fine. Williams, Degeyter, Curry and Crump received two years of probation. Additionally, Williams and Degeyter were sentenced to six months of home confinement. Hanyes, Williams and Curry are former employees of the District Attorney’s Office. Degeyter and Crump are former employees of Acadiana Outreach.
The FBI and the Social Security Administration – Office of Inspector General conducted the investigation. Assistant U.S. Attorneys John Luke Walker and Robert C. Abendroth prosecuted the case.
Pontoon Beach Gas Station Robber Sentenced to More Than 7 Years in PrisonRead the Press Release
Hero citizens gave chase and subdued robber until police arrived on scene
Shawn M. Bequette, 23, of Pontoon Beach, Illinois, was sentenced on September 24, 2015, in the United States District Court for the Southern District of Illinois, to a term of 92 months in federal prison, followed by 3 years of supervised release, for the October 6, 2014 robbery of a Conoco Phillips gas station in Pontoon Beach, Illinois, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
Evidence showed that in the early morning hours of October 6, 2014, Bequette robbed the Pontoon Beach gas station with a BB gun that resembled a real firearm, threatening the store clerk and demanding money from the cash register, along with the clerk’s wallet. As Bequette fled the scene, two witnesses to the crime – who had arrived as the robbery was in progress – chased Bequette down and pinned him to the ground until Pontoon Beach police arrived to arrest him.
The case was investigated by the Federal Bureau of Investigation and the Pontoon Beach Police Department, and prosecuted by Special Assistant United States Attorney Shane B. Kelbley.
Owner of Florida Mortgage Company Sentenced to over 11 Years in Prison for Orchestrating $64 Million Fraud SchemeRead the Press Release
The owner of a Florida mortgage company was sentenced today to serve 135 months in prison for orchestrating a $64 million mortgage fraud scheme.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida and Special Agent in Charge Nadine Gurley of the U.S. Department of Housing and Urban Development Office of Inspector General (HUD-OIG) Atlanta Region made the announcement.
Hector Hernandez, 57, of Miami, Florida, the owner and operator of Great Country Mortgage Bankers (Great Country), a mortgage lender in Miami, was sentenced for conspiracy to commit wire fraud affecting a financial institution. He was also ordered to pay $64,508,141 in restitution and to forfeit $8,000,000 in illicit profits.
In the same case, a real estate developer for Great Country, Aleida Fontao, 62, of Miami, was sentenced today to serve 41 months in prison, and ordered to pay $7,131,952 in restitution and $400,000 in forfeiture. An underwriter for Great Country, Olga Hernandez, 59, of Lake Mary, Florida, was sentenced yesterday to serve 51 months in prison and ordered to pay $24,512,755 in restitution. Hector and Olga Hernandez both pleaded guilty on July 13, 2015, while Fontao pleaded guilty on July 7, 2015. Hector Hernandez was the last defendant to be sentenced in the case. All 24 defendants charged in this case, which included loan officers, loan processors and underwriters, were convicted of participating in the scheme.
According to admissions made in connection with the guilty pleas, from at least 2006 and continuing through at least September 2008, Hector Hernandez was the owner and operator of Great Country which specialized in approving Federal Housing Administration (FHA) loans. The loans were primarily for buyers of condominiums at complexes where Hector Hernandez was a part owner – however, the buyers were unqualified borrowers, due to insufficient income, high levels of debts, and outstanding collections. Hector Hernandez admitted that his company employed loan officers, loan processors and underwriters, including Olga Hernandez and Fontao, whom he knew approved and submitted false and fraudulent FHA mortgage loan applications and accompanying documents to HUD on behalf of the unqualified borrowers. These documents included false pay stubs, false verification of employment forms, and fictitious letters from the borrowers.
According to admissions made in connection with the guilty pleas, closing costs were paid on behalf of the unqualified borrowers through an interstate wire transfer of funds. The borrowers were also paid to purchase the condominium units as an unreported inducement to purchase. After the loans closed, the loans were sold to financial institutions. When the unqualified borrowers failed to meet their monthly mortgage obligations, they defaulted on the loans causing losses both to the financial institutions and to HUD which insured the loans. Hector Hernandez admitted that the loss from the fraudulent conduct was at least $64 million.
This case was investigated by HUD-OIG as participants in the Miami Mortgage Fraud Strike Force. The case was prosecuted by Senior Litigation Counsel David A. Bybee and Trial Attorneys Mike O’Neill and William Johnston of the Criminal Division’s Fraud Section.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Office Manager Indicted for Stealing More Than $980,000 from Birmingham Surgical PracticeRead the Press Release
BIRMINGHAM -- A federal grand jury on Thursday indicted the office manager of a Birmingham surgical practice on charges related to the theft of more than $987,375 from her employer, announced U.S. Attorney Joyce White Vance, FBI Special Agent in Charge Roger C. Stanton and Internal Revenue Service and Internal Revenue Service, Criminal Investigation, Special Agent in Charge Veronica Hyman-Pillot.
A nine-count indictment filed in U.S. District Court charges ANNTWINE MOSS, 49, of Bessemer, with five counts of wire fraud and four counts of tax evasion for stealing more than $987,375 from Thoracic and Cardiovascular Surgery of Alabama between 2006 and 2013.
According to the indictment, Moss executed a scheme to defraud the surgical practice by using her authority as office manager to write unauthorized checks to herself, make unauthorized direct deposits into her account, and use the company's credit cards for unauthorized personal purchases. As office manager, Moss had authority over several key functions including payroll, accounting, bookkeeping and managing the office's budget. The indictment also charges that she falsified her personal tax returns for several years by failing to report to the IRS the illicit income she stole from TCVSA.
The maximum penalty for each wire fraud count is 20 years in prison and a $250,000 fine, while the tax evasion count carries a maximum penalty of 20 years in prison and a $1 million fine.
The FBI and IRS investigated the case, which Assistant U.S. Attorney Xavier O. Carter Sr. is prosecuting.
An indictment contains only charges. A defendant is presumed innocent unless and until proven guilty.
Northern Minnesota Man Found Guilty of Sexually Abusing Two Women on the Red Lake Indian ReservationRead the Press Release
United States Attorney Andrew M. Luger today announced the conviction of WILLIAM ANDREW CLARK, 66, of Blackduck, Minn., for sexually abusing two women on the Red Lake Indian Reservation. On May 12, 2015, CLARK was indicted on one count of Aggravated Sexual Abuse and one count of Sexual Abuse involving these two women. On September 24, 2015, following a two-day trial, United States District Court Judge Donovan W. Frank found CLARK guilty on all counts.
As proven at trial, in the fall of 2013, CLARK sexually assaulted a woman on the Red Lake Indian Reservation. The woman was intoxicated and unconscious when CLARK raped her. On September 11, 2014, CLARK forcibly sexually assaulted another woman, having driven the victim to a remote part of the Red Lake Indian Reservation and raping her.
U.S. District Judge Donovan W. Frank will sentence CLARK at a later date, yet to be scheduled.
This case is the result of an investigation by the Federal Bureau of Investigation and the Red Lake Police Department.
Assistant U.S. Attorney Clifford B. Wardlaw is prosecuting this case.
Defendant Information:
WILLIAM ANDREW CLARK, 66
Blackduck, Minn.
Convicted:
- Aggravated Sexual Abuse, 1 count
- Sexual Abuse, 1 count
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Northern District of Indiana Grand Jury Returns A 36 Count Superseding IndictmentRead the Press Release
HAMMOND- United States Attorney David Capp announced today that a federal grand jury returned a 36 count superseding indictment charging Jack Weichman, 63, of Dyer, Indiana; Ari Weichman, 35, of Schererville, Indiana; James Schaefer, 65, of Lowell, Indiana; and William Bercaw, 68, of Munster, Indiana with participation in several schemes in violation of federal law. The previous indictment charged nine counts of bank fraud, fourteen counts of bankruptcy fraud, two counts of money laundering, four counts of wire fraud, and five counts of filing false federal income tax returns. The new indictment adds a count of conspiracy to conceal assets in a bankruptcy proceeding, and an additional count of concealment of assets. The new indictment also adds three additional defendants. It charges Ari Weichman, son of defendant Jack Weichman, and James Schafer, Accounting/Tax Manager for the Weichman and Associates accounting firm, in the concealment of assets conspiracy. It also adds William Bercaw, a CPA employed at Weichman and Associates, as a defendant in the wire fraud counts.
The new charge of conspiracy to conceal assets alleges that Jack Weichman conspired with Ari Weichman and James Schafer to conceal assets from the bankruptcy court in an effort to hide Jack Weichman’s true financial condition. The indictment alleges James Schafer filed monthly reports with the bankruptcy court that disguised assets, in the amount of $790,000.00, as business expenses in the form of payments to Ari Weichman as an employee of Weichman and Associates and of MMDS, another Jack Weichman owned and operated medical billing company, when in fact Ari Weichman never worked for either company.
This case was investigated by the Internal Revenue Service-Criminal Investigation Division, the Federal Deposit Insurance Corporation-Office of Inspector General, and the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorneys Diane L. Berkowitz and David Nozick.
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.
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New Haven Man Charged with Illegal Gun PossessionRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that a federal grand jury in New Haven returned an indictment yesterday charging JAMES DOUGLAS, also known as “Sucky,” 23, of New Haven, with unlawful possession of a firearm by a felon.
As alleged in the indictment, on May 26, 2015, DOUGLAS possessed a .32 caliber Smith & Wesson revolver. Prior to that date, DOUGLAS had sustained felony convictions, including second degree burglary, third degree larceny and carrying a pistol without a permit.
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.
If convicted, DOUGLAS faces a maximum term of imprisonment of 10 years and a fine of up to $250,000.
DOUGLAS has been detained in state custody since his arrest on May 26, 2015.
U.S. Attorney Daly stressed that an indictment is not evidence of guilt. Charges are only allegations, and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This matter is being investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the New Haven Police Department. This case is being prosecuted by Assistant United States Attorney Jennifer Laraia.
New Britain Bakery Operator Sentenced for Tax FraudRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that MARIAN KOBRYN, 63, of Farmington, was sentenced today by Senior U.S. District Judge Warren W. Eginton in Bridgeport to one day of imprisonment, time already served, and one year of supervised release, for filing false tax returns. KOBRYN also was ordered to pay a $10,000 fine and more than $425,000 in back taxes, interest, and penalties.
According to court documents and statements made in court, KOBRYN and his wife own and operate Kasia’s Bakery in New Britain. Until recently, Kasia’s Bakery routinely operated on a “cash only” basis. During the 2010 through 2013 tax years, KOBRYN diverted $730,860 in cash that the business received, deposited the money into his and his wife’s personal bank accounts, and failed to pay $242,889 in federal taxes on the income.
The investigation revealed that KOBRYN attempted to conceal the diverted cash proceeds by regularly traveling to several branches of Farmington Bank to make cash deposits in amounts under $10,000 in order to evade the bank’s currency transaction reporting requirements.
To date, KOBRYN has paid the $242,889 tax due, as well as $50,000 toward the interest and penalties. Judge Eginton ordered KOBRYN to pay the remaining interest and penalties before the expiration of KOBYRN’s term of supervised release.
Judge Eginton stated that he sentenced KOBRYN to time served in lieu of a longer term of incarceration based in part on KOBRYN’s serious health issues.
On June 2, 2015, KOBRYN pleaded guilty to one count of making a false statement on a federal tax return.
This matter was investigated by the Internal Revenue Service – Criminal Investigation Division and was prosecuted by Assistant U.S. Attorney David J. Sheldon.
Nebraska Man to Federal Prison for Meth ConspiracyRead the Press Release
A man who conspired to distribute methamphetamine was sentenced September 24, 2015, to six years in federal prison.
Jose William Orellana, 42, from South Sioux City, Nebraska, received the prison term after a May 22, 2015, jury verdict finding him guilty of conspiracy to distribute methamphetamine.
Evidence at trial showed Orellana participated in a conspiracy that distributed methamphetamine in Sioux City, Iowa and South Sioux City, Nebraska. Law enforcement officers gathered incriminating evidence through surveillance, and a series of covert drug buy operations from September 2013 through May 13, 2014.
Orellana was sentenced in Sioux City by United States District Court Judge Mark W. Bennett. Orellana was sentenced to 72 months’ imprisonment. A special assessment of $100 was imposed. He must also serve a four-year term of supervised release after the prison term. There is no parole in the federal system.
Orellana is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Shawn S. Wehde and investigated by the Tri-State Drug Task Force based in Sioux City, Iowa, that consists of law enforcement personnel from the Drug Enforcement Administration; Sioux City, Iowa, Police Department; Homeland Security Investigations; Woodbury County Sheriff’s Office; South Sioux City, Nebraska, Police Department; Nebraska State Patrol; Iowa National Guard; Iowa Division of Narcotics Enforcement; United States Marshals Service; South Dakota Division of Criminal Investigation; and Woodbury County Attorney’s Office.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 14-4046.
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Mortgage Loan Originator Pleads Guilty, Unlicensed Appraiser Charged in Ongoing Mortgage Fraud InvestigationRead the Press Release
PROVIDENCE, R.I. – An ongoing federal and state law enforcement investigation into alleged mortgage fraud in Rhode Island has resulted to date in a former mortgage originator pleading guilty in federal court to conspiracy to commit bank fraud, and an unlicensed real estate appraiser being charged with allegedly stealing the identity of other appraisers when performing and submitting real estate appraisals to banks as documentation for mortgage loan applications.
Franchesco Franco, 34, of Providence, a former mortgage loan originator, pleaded guilty in federal court to conspiracy to commit bank fraud for his participation with a local real estate attorney and others in a scheme to defraud Flagstar Bank, by filing a fraudulent mortgage loan application and supporting documentation in the name of a person known to him who had recently died, in order to secure a loan in the amount of $157,102 for the purchase of a residence at 63 Wendell Street in Providence.
According to court documents, after the mortgage was issued, Franco filed fraudulent documents in the deceased person’s name in order to have his own name added to the deed for the property. Loan payments were never made to Flagstar Bank, an FHA-insured lender, by Franco or anyone else. As a result, the U.S. Department of Housing and Urban Development (HUD) paid an insurance claim to Flagstar Bank for the unpaid balance of the loan in the amount of $165,062. According to court documents, a corporation formed by the real estate attorney, an alleged co-conspirator in this matter, later purchased the note for $35,000.
In a separate matter discovered during the investigation into mortgage fraud in Rhode Island which resulted in the charges being brought against Franco, it is alleged that Dylan T. Kelly, 40, whose real estate appraiser’s license expired in September 2008, has continued to conduct and issue real estate appraisals using the identity, license and insurance certificate of licensed appraisers without the licensed appraisers’ permission or knowledge. Kelly has been charged in federal court with conspiracy to commit bank fraud, false statements in loan applications and aggravated identity theft.
Franchesco Franco’s guilty plea and charges brought against Dylan T. Kelly are announced by United States Attorney Peter F. Neronha; Christina D. Scaringi, Special Agent in Charge of the Northeast Region of the U.S. Department of Housing and Urban Development Office of Inspector General; Ted A. Arruda, Resident Agent in Charge of the Providence Office of the U.S. Secret Service; and Colonel Steven G. O’Donnell, Superintendent of the Rhode Island State Police.
Appearing before U.S. District Court Judge John J. McConnell, Jr., Franco admitted to the court that beginning in January 2010, he participated in a conspiracy in which he made false statements on a mortgage loan application and provided false documentation, including fraudulent tax returns, pay stubs, verification letters and bank statements, all in the name of a deceased person known to Franco, in order to secure a federally insured mortgage from Flagstar Bank in the amount of $157,102. Franco also provided copies of the deceased person’s social security card and driver’s license.
According to court documents, as part of the scheme, on April 15, 2010, more than three weeks after the death of the individual known to Franco, Franco filed a tax return for tax year 2009 in the deceased person’s name. In the filing, Franco provided the IRS his own personal bank account number, purporting that the bank account number belonged to the deceased individual and was to be used for direct deposit of a tax refund. The tax form was later provided by Franco to Flagstar Bank as supporting documentation for the mortgage loan application in the deceased person’s name.
According to court documents, in September 2010, one month after Flagstar issued the mortgage and a closing took place for purchase of the Wendell Street property, Franco forged or caused to be forged documents and the deceased person’s signature in order to have his name added to the deed for the property. No payments were ever made on the mortgage loan by Franco or anyone else. As a result, in July 2011, HUD paid an insurance claim to Flagstar Bank in the amount $165,062, which represented the balance of the mortgage loan. In March 2012, the real estate attorney allegedly involved in the conspiracy bought the note, which was in the deceased person’s name, for $35,000.
In a separate matter discovered by federal and state law enforcement and prosecutors from the U.S. Attorney’s Office during the ongoing investigation into mortgage fraud in Rhode Island, it is alleged that on at least four occasions Dylan Kelly, whose real estate appraiser’s license expired in September 2008, continued to conduct and issue real estate appraisals using the identity, license and insurance certificate of licensed appraisers without the licensed appraisers’ permission or knowledge. It is alleged that between February 19, 2014, and December 2, 2014, Kelley fabricated and submitted appraisals in support of mortgage loans being sought on at least four properties in Providence and Pawtucket.
This matter, which is being investigated by the U.S. Department of Housing and Urban Development Office of Inspector General, U.S. Secret Service, Rhode Island State Police and the United States Attorney’s Office, is being prosecuted by Assistant U.S. Attorney’s Sandra R. Hebert and William J. Ferland.
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Jim Martin (401) 709-5357
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Missouri Man Sentenced for Wildlife TraffickingRead the Press Release
The United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today that Rex Dale Rains II, 54, of Maryland Heights, Missouri, was sentenced on two counts of Wildlife Trafficking and two counts of False Labelling under the Lacey Act. For each of these misdemeanors, the United States District Court in East Saint Louis sentenced Rains to serve 24 months of probation. The district court ordered Rains to pay a $500 fine and a $100 special assessment. The district court also ordered Rains to pay restitution of $3,000 each to the U.S. Fish and Wildlife Service’s Lacey Act Reward Account and the Illinois Department of Natural Resources, Conservation Police Operations Assistance Fund, totaling $6,000. Rains must also pay $3,120 for the Collateral Forfeiture of the tilapia and he will forfeit the payment he received for the illegal transaction of $1,325. In all, Rains will owe $11,040 for committing the offenses.
Court records indicate that on June 12, 2012, and June 22, 2013, Rains illegally transported and sold blue tilapia which he obtained from out of Illinois. He also falsely labelled the blue tilapia as blue gill.
Tilapia, a non-native fish from tropical and subtropical Africa and the Middle East, have caused significant damage to the native ecosystems in which they have been released. The blue tilapia is considered a competitor with native species for spawning areas, food and space. In water in which the species is abundant, there has been a significant loss of vegetation and nearly all native fishes.
The case was investigated by the Special Agents from the U.S. Fish and Wildlife Service, Office of Law Enforcement, and the Illinois Department of Natural Resources, Conservation Police. The case is being prosecuted by Assistant U.S. Attorney William E. Coonan.
Michigan Man Sentenced to Federal Prison Term for Investment FraudRead the Press Release
Ocala, Florida – Senior U.S. District Judge Wm. Terrell Hodges has sentenced Bryan T. Zuzga (39, Coldwater, Michigan) to 6 years in federal prison for conspiracy to commit wire fraud. He was also ordered to pay more than $10.7 million in restitution. Zuzga pleaded guilty on June 17, 2015.
According to court documents, Zuzga and his two conspirators, Jenifer E. Hoffman (38, Clermont) and John C. Boschert (43, Apopka), defrauded over $11 million from more than 100 victims through investments offered in connection with a company called Assured Capital Consultants. As part of their solicitations, the conspirators represented to investors that money would be placed in a Performing Private Placement Investment, and that Boschert had connections to the trading program being used. Investors were told that their investments would be safe and that none of their money would leave the attorney escrow account that belonged to Zuzga, who was represented as being an attorney licensed in Florida. Investors were further advised that their funds would be used as collateral for a line of credit, which would then be used in trading.
None of those representations were true. Zuzga was not an attorney licensed in Florida or any other state, and the funds were not deposited into any escrow account controlled by him. Instead, the three operated a scheme in which money from later investors was paid to earlier investors. The three also used some of the money from the scheme for themselves, including purchasing residences for Hoffman and Zuzga.
In a prior civil proceeding, the United States forfeited two residences belonging to Hoffman and Zuzga, which had been purchased with proceeds from the scheme. The government obtained more than $850,000 from the sale of the properties. The proceeds from those sales were distributed to the victims of the scheme.
Boschert previously pleaded guilty for his role in this case, and was sentenced to nine years in federal prison on June 23, 2015. Hoffman has pleaded guilty to one count of conspiracy to commit wire fraud and one count of making a false tax return. Her sentencing hearing is scheduled for October 22, 2015.
This case was investigated by the Internal Revenue Service – Criminal Investigation, the United States Secret Service, and the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorneys Roger B. Handberg, James Mandolfo, and Nicole M. Andrejko.
Miami Gardens Resident Pleads Guilty to Stolen Identity Tax Refund Fraud SchemeRead the Press Release
A Miami Gardens resident pled guilty to a stolen identity tax refund fraud scheme.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), made the announcement.
Rosheem Oneil Williams, 19, pled guilty to one count of possession of fifteen or more unauthorized access devices, in violation of Title 18, United States Code, Section 1029(a)(3), and one count of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A(a)(1). At sentencing, Williams faces a maximum statutory sentence of ten years in prison for the access device charge, and a mandatory term of two years in prison, consecutive to any other term of imprisonment, for the aggravated identity theft charge.
According to court documents, IRS-CI investigators noticed that, from January 17, 2015 through June 6, 2015, 187 tax returns claiming refunds totaling $363,457 were filed from Williams’ residence. A search warrant was executed at the residence on June 19, 2015, and law enforcement found and seized numerous items containing personal identification information (PII) (including names, dates of birth, and social security numbers). Specifically, agents found computer-generated lists and an Apple iPad containing hundreds of individuals’ PII.
Agents interviewed Williams, and he admitted that he possessed the PII found in the residence on June 19, 2015, and that he prepared and filed at least 180 tax returns without the permission of the individuals in whose names the returns were filed.
Williams is scheduled to be sentenced on December 2, 2015 at 2:00 p.m. United States District Judge Marcia G. Cooke.
Mr. Ferrer commended the investigative efforts of IRS-CI. This case is being prosecuted by Assistant U.S. Attorney Daya Nathan.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Mexican National Sentenced to 97 Months for Trafficking Methamphetamine in New MexicoRead the Press Release
ALBUQUERQUE – Jorge Luis Garcia-Valenzuela, 22, a Mexican national illegally residing in Lakeside, Ariz., was sentenced this afternoon in federal court in Albuquerque, N.M., to 97 months in prison for conspiring to distribute methamphetamine in Socorro and Catron Counties, N.M. Garcia-Valenzuela will be deported following his term of incarceration.
Garcia-Valenzuela and his co-defendant Emery Lee Begay, 32, of Lakeside, Ariz., were arrested on Oct. 25, 2014, after they traveled to Quemado, N.M., with the intention of selling methamphetamine and marijuana to undercover officers. According to court records, on Aug. 19, 2013, Begay delivered 22.6 grams of methamphetamine and approximately three kilograms of marijuana to the undercover officers in Socorro, after Garcia-Valenzuela negotiated the drug deal with the officers. On Oct. 25, 2014, Garcia-Valenzuela and Begay traveled to Quemado where they intended to consummate a drug deal with undercover officers and were arrested. The officers seized 800 grams of methamphetamine and more than eight kilograms of marijuana when they arrested the two men.
Begay and Garcia-Valenzuela were indicted on Nov. 19, 2014, and charged with conspiracy to distribute methamphetamine and marijuana, distribution of methamphetamine and marijuana, and possession of methamphetamine and marijuana with intent to distribute. According to the indictment, the offenses were committed between Aug. 19, 2014 and Oct. 25, 2014, in Socorro and Catron Counties.
Garcia-Valenzuela entered a guilty plea on June 19, 2015, to a felony information charging him with conspiracy to distribute and possess methamphetamine.
On May 21, 2015, Begay pled guilty to a felony information charging him with participation in a methamphetamine trafficking conspiracy. Begay was sentenced on Aug. 20, 2015, to 60 months in prison followed by three years of supervised release.
This case was investigated by the Albuquerque and Gallup offices of the FBI, the Southern Pueblos Agency of the BIA’s Office of Justice Services and the Ramah Navajo Tribal Police Department. It was prosecuted by Assistant U.S. Attorney Elaine Y. Ramirez.
Meth Dealer Sentenced in Federal CourtRead the Press Release
United States Attorney Kenyen R. Brown of the Southern District of Alabama announced that Calvin James Monceaux, 38, of Daphne, was sentenced today in federal court. Monceaux pled guilty to conspiracy to possess with intent to distribute methamphetamine in May of 2015.
United States District Court Judge Callie V. S. Granade ordered that Monceaux serve a sentence of 122 months imprisonment, which will be followed by a five-year term of supervised release, which will commence when he is released from prison. As a special condition of his supervision, Monceaux will undergo drug testing and treatment. Judge Granade ordered that Monceaux pay $100 in special mandatory assessments, but she did not impose a fine.
The case was investigated by the the Mobile County Sheriff’s Office and the Department of Homeland Security Investigations. It was prosecuted in the United States Attorney’s Office by Assistant United States Attorney Gloria Bedwell.
Massachusetts Probation Officer Charged with Making False StatementsRead the Press Release
BOSTON – A Massachusetts Department of Probation officer was charged today with making a false statement to the FBI in connection with a public corruption investigation.
Lawrence Plumer, 46, of Brockton, was charged in an Information with one count of making a false statement to the FBI. Plumer has been a Massachusetts probation officer since 2000.
The charging statute provides a sentence of no greater than five years in prison, three years of supervised release, and a fine of $250,000. The plea agreement also filed today states that Plumer has agreed to resign his position as a probation officer. 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; Joseph R. Bonavolonta, Acting Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division, made the announcement today. The U.S. Attorney’s Office also acknowledges the cooperation of the Massachusetts Attorney General’s Office. The case is being prosecuted by Assistant U.S. Attorney Robert A. Fisher of Ortiz’s Public Corruption Unit and Special Prosecutions Unit.
The details contained in the Information are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Massachusetts Probation Officer Charged with Making False StatementRead the Press Release
BOSTON – A Massachusetts Department of Probation officer was charged today with making a false statement to the FBI in connection with a public corruption investigation.
Lawrence Plumer, 46, of Brockton, was charged in an Information with one count of making a false statement to the FBI. Plumer has been a Massachusetts probation officer since 2000.
The charging statute provides a sentence of no greater than five years in prison, three years of supervised release, and a fine of $250,000. The plea agreement also filed today states that Plumer has agreed to resign his position as a probation officer. 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; Joseph R. Bonavolonta, Acting Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division, made the announcement today. The U.S. Attorney’s Office also acknowledges the cooperation of the Massachusetts Attorney General’s Office. The case is being prosecuted by Assistant U.S. Attorney Robert A. Fisher of Ortiz’s Public Corruption Unit and Special Prosecutions Unit.
The details contained in the Information are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Lee County Man Convicted of Bank Robbery with A Dangerous WeaponRead the Press Release
Fort Myers, Florida – United States Attorney A. Lee Bentley, III announces that a federal jury has found Jose Benitez, Jr. (46, Cape Coral) guilty of bank robbery with a dangerous weapon. He faces a maximum penalty of 20 years in federal prison. His sentencing hearing is scheduled for January 4, 2016. Benitez was indicted on October 29, 2014.
According to evidence presented at trial, on October 8, 2014, Benitez robbed the Iberia Bank located at 812 Del Prado Boulevard South in Cape Coral. During the commission of the robbery, he walked into the bank dressed all in black with his face covered. He pointed a weapon at various bank employees, putting them in fear of their lives. He also threatened the employees, and forced them to get on the ground. Benitez fled the bank after the robbery, but left his glasses behind. A fingerprint recovered from the glasses was traced to Benitez.
This case was investigated by the Federal Bureau of Investigation and the Cape Coral Police Department. It was prosecuted by Assistant United States Attorney Michael C. Baggé-Hernández.
Lake Charles man sentenced to more than 17 years in prison for receiving child pornography on computerRead the Press Release
LAKE CHARLES, La. – United States Attorney Stephanie A. Finley announced that a Lake Charles man was sentenced Thursday to 210 months in prison for receiving child pornography on his home computer.
Ricky Joseph Guidry, 31, of Lake Charles, was sentenced by U.S. District Judge Patricia Minaldi on one count of receiving child pornography. He was also sentenced to serve a lifetime of supervised release and must register as a sex offender. According to evidence presented at the March 14, 2015 guilty plea, a witness told law enforcement agents there was child pornography on Guidry’s computer. After conducting an examination of the computer, it was determined that the defendant downloaded child pornography on October 2nd and 3rd of 2014. The images included prepubescent child pornography that was sadistic in nature.
Homeland Security Investigations and the Calcasieu Parish Sheriff’s Office investigated the case. Assistant U.S. Attorney John Luke Walker prosecuted the case.
“The internet is no longer a safe haven for child predators to view illegal images and encourage child abuse,” Finley stated. “This office will prosecute those who download, view and distribute child pornography. Law enforcement officers and prosecutors will continue in their work to bring these abusers to justice.”
“Criminals who trade in child pornography steal the innocence of children and contribute to the destruction of innocent lives,” said HSI New Orleans Special Agent in Charge Raymond R. Parmer Jr. “HSI special agents are actively working to identity and arrest those who abuse children as well as those who further exploit them by recording the abuse.”
This case is part of Project Safe Childhood, a U.S. Department of Justice nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, visit www.projectsafechildhood.gov.
The U.S. Attorney’s Office and the U.S. Department of Homeland Security/Homeland Security Investigations/Immigration & Customs Enforcement (ICE) encourage the public to report suspected child predators and any suspicious activity through its toll-free hotline at (866) DHS-2ICE. Investigators are available at all hours to answer hotline calls. Tips or other information can also be submitted to ICE online at www.ice.gov/exec/forms/hsi-tips/tips.asp or through the Operation Predator smartphone app (http://www.ice.gov/predator/smartphone-app). Tips may be submitted anonymously.
La Jolla Bank Manager Conspired with Senior Bank Officials to Issue Hundreds of Millions of Dollars in Bad LoansRead the Press Release
Assistant U.S. Attorney Emily W. Allen (619) 546-9738
NEWS RELEASE SUMMARY – September 25, 2015
SAN DIEGO – Amalia Martinez, the head of Small Business Administration (“SBA”) lending at the now- defunct La Jolla Bank, pleaded guilty today to conspiracy to misapply bank funds, admitting that she and other senior bank executives accepted cash bribes and kickbacks from borrowers in return for issuing hundreds of millions of dollars in loans to borrowers they knew were unqualified and unlikely to repay. The mismanagement contributed to the bank’s collapse in February 2010, when the Federal Deposit Insurance Corporation (“FDIC”) took over and absorbed its outstanding debt of more than $1 billion. That $1 billion tab was ultimately passed on to the taxpayers.
Beginning in 2004, Martinez and senior bank officers agreed to issue loans under favorable terms to high-volume borrowers they referred to as “Friends of the Bank,” or “FOBs.” They accepted fraudulent loan applications from the FOBs, and overlooked negative information about the borrowers’ creditworthiness. When the FOBs defaulted on their repayment obligations, the bank executives would issue more loans, so that the borrowers could use bank funds to make payments on their existing loans. In this way, the executives covered up the bank’s true poor performance, and allowed the bad loans to inflate their performance measures—which, in turn, increased their compensation from the bank.
Several of the FOBs participated in the conspiracy by making large cash payments in return for loans. In late 2007, one construction borrower handed $100,000 in cash to a senior bank official, who went on to share that money with Martinez and others. Another borrower, who received $75 million in loans, met with the same bank official in Las Vegas in 2008, where he hand-delivered $250,000 in cash. In 2006, a restaurant owner paid $50,000 in cash in return for loans; later, when the borrower struggled to repay his debts, Martinez arranged to issue another $150,000 loan, to be used to make payments on existing debts.
The conspirators also took efforts to cover up the scheme. In 2009, as the bank was failing, regulators began to investigate La Jolla Bank’s poor performance. In order to conceal the mismanagement and self-dealing from the regulators, senior bank officials directed Martinez and other co-conspirators to destroy fraudulent financial statements and “FOB” designations contained within the bank’s files, according to Martinez’s plea agreement.
Martinez admitted that she arranged to lend more than $55 million in SBA-backed loans as part of the conspiracy, and lost nearly $20 million in bank funds when those loans defaulted. The bank’s conventional lending portfolio was much larger, resulting in hundreds of millions of dollars in loans issued as part of the conspiracy.
To date, three other defendants have been charged in this case. SBA borrower Annand Sluman pled guilty and admitted paying cash bribes to Martinez in return for several SBA loans he was issued between 2006 and 2008. By 2008, Sliuman was not qualified to borrow, and he submitted fraudulent documents as part of his loan application that made his businesses appear to be qualified. Sliuman’s assistant, Laura Ortuondo, assisted in creating the fraudulent loan documents. She pled guilty to making false statements to investigators about her involvement in the case; as part of her plea, she also admitted that she destroyed evidence and instructed her then-husband to testify falsely on her behalf to help cover up the crime.
In August 2015, La Jolla Bank loan broker Jocelyn Brown was indicted for paying bribes to Martinez and others, in return for their help arranging loans for Brown’s borrowers. According to the indictment, Brown kicked back a portion of her broker commission to ensure that loans she referred to the bank were approved, regardless of the soundness of the loans and their benefit to the bank. Brown was arrested on August 7, 2015, and her case is pending before United States District Judge Anthony J. Battaglia. No trial date has yet been set.
“By accepting bribes in exchange for lending out the bank’s money, corrupt officials at La Jolla Bank exposed the bank to a substantial risk and, ultimately, ran the bank into the ground. Their greed cost the taxpayers, who had to step in and repay its depositors,” said U.S. Attorney Laura E. Duffy. “Attacking corruption at financial institutions is one important tool we have to protect taxpayers and reduce the likelihood that our country will have to ‘bail out’ another bank.” U.S. Attorney Duffy noted that the investigation of La Jolla Bank continues, and anyone with information is encouraged to call the Federal Bureau of Investigation at 858-320-1800.
“The Treasury Inspector General for Tax Administration is committed to investigating and prosecuting individuals to the fullest extent of the law when they choose to commit acts of bribery,” said Special Agent in Charge Rod Ammari. “Bribery will never be tolerated and TIGTA is committed to rooting out such illegal activity, especially when the millions of dollars that are lost from bribery are passed on to the hard working American taxpayer.”
“The Federal Deposit Insurance Corporation Office of Inspector General is pleased to join our law enforcement colleagues in announcing today’s guilty plea,” said Wade V. Walters, Special Agent in Charge of the FDIC’s Office of Inspector General. “We are proud to have played a role in uncovering a complex conspiracy that contributed to substantial losses to the Deposit Insurance Fund. We are committed to continuing investigative efforts to protect the viability of the fund and ensure integrity in our nation’s banks.”
“Ms. Martinez abused her position of trust to unjustly enrich herself at the expense of American taxpayers," stated FBI Special Agent in Charge, Eric S. Birnbaum. "The FBI is committed to using our investigative and intelligence capabilities to identify, disrupt and dismantle corrupt business practices within our financial industry.”
“When individuals defraud a bank they are in effect defrauding the community as well,” said Special Agent in Charge Leslie P. DeMarco of the Federal Housing Finance Agency’s Office of Inspector General. “It is particularly egregious when the individuals engaging in the fraud are the very individuals entrusted by the bank to serve the community. These individuals caused great harm to the bank, the community, and ultimately the taxpayers. We are committed to holding all bad actors accountable for their actions.”
Martinez’s guilty plea was taken before U.S. Magistrate Judge Bernard G. Skomal. She is scheduled to be sentenced by Judge Battaglia on November 30, 2015 at 9:00 a.m. On September 12, 2014, Judge Battaglia sentenced Laura Ortuondo to three years’ probation including 12 months of home detention, and ordered her to pay a $3,000 fine. Annand Sliuman is scheduled to be sentenced by Judge Battaglia on December 14, 2015, at 9:00 am.
DEFENDANTS AND CHARGES:
Amalia Martinez, 15CR2471-AJB Age 51 San Diego, CA
Conspiracy to misapply bank funds, in violation of 18 U.S.C. § 371
Maximum Penalties: 5 years’ imprisonment, $250,000 fine or twice the pecuniary loss or gain, three years supervised release, $100 special assessment, restitution.
Jocelyn J. Brown, 15CR2049-AJB Age: 59 San Diego, CA
Conspiracy to commit bank bribery, in violation of 18 U.S.C. § 371
Maximum Penalties: 5 years’ imprisonment, $250,000 fine or twice the pecuniary loss or gain, three years supervised release, $100 special assessment, restitution.
Bank bribery, in violation of 18 U.S.C. § 215
Maximum Penalties: 30 years’ imprisonment, $1,000,000 fine or three times the value of the thing given, offered, or promised, five years’ supervised release, $100 special assessment, restitution.
Making a false statement to a federal agent, in violation of 18 U.S.C. § 1001
Maximum Penalties: 5 years’ imprisonment, $250,000 fine, $100 special assessment, restitution.
Annand Sliuman, 13CR3673-AJB Age 34 Spring Valley, CA
Bank bribery, in violation of 18 U.S.C. § 215
Maximum Penalties: 30 years’ imprisonment, $1,000,000 fine or three times the value of the thing given, offered, or promised, five years’ supervised release, $100 special assessment, restitution.
Laura Ortuondo, 13CR3879-AJB Age 34 Cupertino, CA
Making a false statement to a federal agent, in violation of 18 U.S.C. § 1001
Maximum Penalties: 5 years’ imprisonment, $250,000 fine, $100 special assessment, restitution.
AGENCIES
Federal Bureau of Investigation
U.S. Small Business Administration – Office of Inspector General
Treasury Inspector General for Tax Administration
Federal Deposit Insurance Corporation – Office of Inspector General
Department of the Treasury – Office of Inspector General
Federal Housing Finance Agency – Office of Inspector General
*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Justice Department Announces Two Banks Reach Resolutions under Swiss Bank ProgramRead the Press Release
The Department of Justice announced today that Migros Bank AG (Migros) and Graubündner Kantonalbank (Graubündner) have reached resolutions under the department’s Swiss Bank Program. These banks will collectively pay penalties totaling more than $18 million.
“It is abundantly clear from the agreements reached to date that for decades, many foreign financial institutions engaged in a pattern of conduct designed to facilitate the concealment of accounts owned by U.S. taxpayers, and to profit from these relationships,” said Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division. “With each agreement reached under the Swiss Bank Program, and each U.S. accountholder who initiates and completes a voluntary disclosure to the Internal Revenue Service, we move a step closer to eliminating secret undisclosed accounts.”
The Swiss Bank Program, which was announced on Aug. 29, 2013, provides a path for Swiss banks to resolve potential criminal liabilities in the United States. Swiss banks eligible to enter the program were required to advise the department by Dec. 31, 2013, that they had reason to believe that they had committed tax-related criminal offenses in connection with undeclared U.S.-related accounts. Banks already under criminal investigation related to their Swiss-banking activities and all individuals were expressly excluded from the program.
Under the program, banks are required to:
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Make a complete disclosure of their cross-border activities;
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Provide detailed information on an account-by-account basis for accounts in which U.S. taxpayers have a direct or indirect interest;
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Cooperate in treaty requests for account information;
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Provide detailed information as to other banks that transferred funds into secret accounts or that accepted funds when secret accounts were closed;
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Agree to close accounts of accountholders who fail to come into compliance with U.S. reporting obligations; and
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Pay appropriate penalties.
Swiss banks meeting all of the above requirements are eligible for a non-prosecution agreement.
According to the terms of the non-prosecution agreements signed today, each bank agrees to cooperate in any related criminal or civil proceedings, demonstrate its implementation of controls to stop misconduct involving undeclared U.S. accounts and pay penalties in return for the department’s agreement not to prosecute these banks for tax-related criminal offenses.
Migros was founded in 1957 and is headquartered in Zurich. As of Dec. 31, 2014, Migros Bank had 66 offices (all in Switzerland) and more than 1,300 employees. In January 2001, Migros Bank entered into a Qualified Intermediary (QI) Agreement with the Internal Revenue Service (IRS). The QI regime provided a comprehensive framework for U.S. information reporting and tax withholding by a non-U.S. financial institution regarding U.S. securities. Migros Bank issued several directives to its employees concerning the QI Agreement. An October 2000 directive stated that persons subject to U.S. taxes who did not want to be disclosed to the “U.S. tax authority” would not be authorized to hold or purchase U.S. securities in their accounts beginning on Jan. 1, 2001. The directive further stated that persons subject to U.S. taxes who disclosed their identities to the U.S. tax authority via an IRS Form W-9 could purchase and sell U.S. securities without restriction.
Migros Bank also created a handbook regarding the QI Agreement, which was first issued to its employees in 2003. The handbook recognized that “the U.S. retains the right to full taxation of its citizens,” but also that a “U.S. person has the option not to disclose to U.S. tax authorities.” The handbook instructed Migros Bank employees that “[i]f a U.S. person does not wish to disclose to U.S. tax authorities, it is sufficient if the W-9 form is not filled out for Migros Bank,” and that the customer could sign a waiver to forego investing in U.S. securities. The handbook further instructed Migros Bank employees that clients residing in the United States “who would like to refrain from disclosure” could be “tended to” by, among other things, retaining their mail in Switzerland through hold-mail agreements, not making regular fund transfers to the United States and not sending payment orders from the United States.
From 2001 until 2005, Migros Bank accepted referrals of U.S. persons as new clients from an external asset manager based in Switzerland. The external asset manager brought a total of 165 U.S.-related accounts to Migros Bank during that period, and most of those accountholders were U.S. residents. The maximum value of these accounts during that period was approximately $62 million. The external asset manager had full control of his clients’ accounts, and Migros Bank’s relationship managers usually interacted with him rather than with his clients. In 2005, Migros Bank decided to terminate its relationship with the external asset manager, but it did not end the relationship until the end of 2006 in order to provide the external relationship manager with additional time to contact his clients and possibly move their funds to other depositary banks. Alternatively, his clients could elect to stay at Migros Bank and give the external asset manager powers of attorney to continue managing their accounts.
In December 2008, Migros Bank’s executive board established a working group of bank officials to study the situation of U.S.-domiciled clients, whom Migros Bank considered to be the riskiest U.S. persons from a U.S. tax-enforcement perspective, identify any related risks to Migros Bank and propose measures to limit such risks. The working group assessed the risk of U.S. tax authorities taking actions against additional Swiss banks as moderate and the risk of Migros Bank’s website and e-banking services causing it to fall under U.S. bank supervision as low. They also assessed the risk of relationship managers’ insufficient legal and linguistic knowledge causing erroneous advice to U.S.-domiciled clients as moderate.
The working group considered discontinuing business with all U.S.-domiciled clients to be a “low priority” because that business generated earnings with hardly any additional expenditure and had “further potential as various banks are discontinuing the provision of advisory services.” Instead, the working group considered the creation of a U.S. desk to be a top priority. The working group presented a business case for this option that envisioned obtaining an additional one percent share of the total U.S.-domiciled clients with more than 1 million Swiss francs in assets then being served by all Swiss banks. The working group estimated that there were more than 2,500 UBS clients alone in that category. The business case also envisioned potentially obtaining an additional two percent share of all other U.S.-domiciled clients, “depending on the strategy.” The working group estimated that this course of action would result in Migros Bank having 250 million Swiss francs under management from U.S.-domiciled clients.
The executive board ultimately decided, starting in 2009, to create a U.S. desk by re-assigning all U.S.-domiciled clients, whether in premium or retail banking, to a group of premium-banking relationship managers who spoke English and had received specialized regulatory training. The head of the premium-banking department had ultimate responsibility over this team, which eventually included nine relationship managers. In May 2009, Migros Bank issued a directive requiring that the head of the premium-banking department approve all new U.S.-domiciled clients, prohibiting Migros Bank employees from sending correspondence to the United States or accepting orders received by telephone, fax or mail from the United States, and prohibiting U.S.-domiciled clients from initiating transactions through the e-banking system. After issuing the directive, Migros Bank accepted 37 new U.S.-related accounts in the remainder of 2009. Of these, 17 were funded by transfers from banks with operations already under investigation by the department, or Category 1 banks.
Since Aug. 1, 2008, Migros Bank provided banking services for 898 U.S.-related accounts, with more than $273 million in assets. Migros Bank will pay a penalty of $15.037 million.
Graubündner was founded in 1870. It is headquartered in Chur, Switzerland, and has 63 branches, all located within the Canton of Graubünden.
With respect to its U.S.-related accounts, Graubündner offered a variety of traditional Swiss banking services that, though available to all of its clients, were used by some U.S. taxpayers to conceal their undeclared assets and income. These services included code word or numbered accounts and assisting U.S. clients in executing forms that directed Graubündner not to disclose their names to the IRS. For approximately 76 U.S-related accounts, Graubündner provided hold mail services, through which Graubündner held bank statements and other mail in Switzerland rather than sending the documents to the United States. In a few cases, Graubündner processed substantial cash withdrawals in connection with U.S. clients’ closure of their accounts. For example, at an account closing in December 2009, the bank permitted a U.S. taxpayer to withdraw approximately $112,000 in cash. Graubündner also closed a U.S.-related account held by a U.S. citizen and resident by transferring the account funds to another Graubündner account held in the name of the U.S. client’s parents, who lived in Switzerland.
Graubündner opened and maintained accounts for seven U.S. taxpayers in the names of offshore structures where the U.S taxpayer’s interest in the account was not reported to the IRS. Five U.S. citizens were the beneficial owners of accounts held in the names of nominee entities, including four Liechtenstein foundations and a British Virgin Islands company. Two of these accounts had traded in U.S. securities, but Graubündner did not report account earnings or transmit withholding taxes to the IRS as required. Graubündner also opened and maintained two accounts in the names of Swiss companies, one for a Swiss citizen and one for a German citizen, both of whom resided in the United States.
In December 2008, Graubündner required that all new and existing U.S. clients, irrespective of domicile, submit a handwritten declaration of compliance with their U.S. tax obligations, waive Swiss banking secrecy and provide a Form W-9. Graubündner also prohibited the opening of new accounts for entities with a U.S. beneficial owner, even with a Form W-9 and confirmation of tax compliance. New U.S. clients who failed to submit the requested documents were not supposed to be accepted, though initially some relationship managers continued to accept U.S. customers without securing a Form W-9. Existing clients who failed to meet these requirements were to be exited by June 2010. In July 2009, Graubündner stopped accepting any new U.S. clients, with the exception of U.S. nationals residing in Switzerland or Swiss nationals temporarily residing in the United States.
Graubündner has fully cooperated with the department, providing all relevant and requested information and documents as part of its participation in the Swiss Bank Program. Further evidencing Graubündner’s cooperation is the fact that its employees and members of the board of directors have not objected to the disclosure of their names and functions at Graubündner to the department. In compliance with Swiss privacy laws, Graubündner has sought and obtained bank secrecy waivers from many of its U.S. customers, whose names were then provided to the U.S. government.
Since Aug. 1, 2008, Graubündner had 364 U.S.-related accounts with an aggregate maximum balance of approximately $105.5 million. Graubündner will pay a penalty of $3.616 million.
In accordance with the terms of the Swiss Bank Program, each bank mitigated its penalty by encouraging U.S. accountholders to come into compliance with their U.S. tax and disclosure obligations. While U.S. accountholders at these banks who have not yet declared their accounts to the IRS may still be eligible to participate in the IRS Offshore Voluntary Disclosure Program, the price of such disclosure has increased.
Most U.S. taxpayers who enter the IRS Offshore Voluntary Disclosure Program to resolve undeclared offshore accounts will pay a penalty equal to 27.5 percent of the high value of the accounts. On Aug. 4, 2014, the IRS increased the penalty to 50 percent if, at the time the taxpayer initiated their disclosure, either a foreign financial institution at which the taxpayer had an account or a facilitator who helped the taxpayer establish or maintain an offshore arrangement had been publicly identified as being under investigation, the recipient of a John Doe summons or cooperating with a government investigation, including the execution of a deferred prosecution agreement or non-prosecution agreement. With today’s announcement of these non-prosecution agreements, noncompliant U.S. accountholders at these banks must now pay that 50 percent penalty to the IRS if they wish to enter the IRS Offshore Voluntary Disclosure Program.
“Today’s resolution with Migros Bank AG and Graubündner Kantonalbank continues the progress of DOJ’s Swiss Bank Program,” said acting Deputy Commissioner International David Horton of the IRS Large Business & International Division. “This settlement aids our efforts to make sure U.S. taxpayers report their foreign accounts and pay taxes on the income earned on those accounts. Working with DOJ, we continue to make progress fighting offshore tax evasion and those who aid such illegal activity.”
“The Swiss Bank Program continues to pay dividends due to the strength of our partnership with the Department of Justice,” said Chief Richard Weber of IRS-Criminal Investigation (CI). “A significant element of this program has been the influx of highly-detailed account data along with information about the variety of schemes used to hide assets overseas. This information will continue to be used on both an individual and global basis to combat international tax evasion.”
Acting Assistant Attorney General Ciraolo thanked the IRS, and in particular, IRS-CI and the IRS Large Business & International Division for their substantial assistance. Ciraolo also thanked Gregory E. Van Hoey, Michael R. Pahl, John E. Sullivan and Thomas G. Voracek, who served as counsel on these matters, as well as Senior Counsel for International Tax Matters and Coordinator of the Swiss Bank Program Thomas J. Sawyer and Senior Litigation Counsel Nanette L. Davis of the Tax Division.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
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Jury Finds Springdale Man Guilty of Drug Conspiracy and Firearm ChargesRead the Press Release
Fayetteville, Arkansas – Kenneth Elser, Acting United States Attorney for the Western District of Arkansas, announced that Gilberto Ray Ramos, age 41, of Springdale, was found guilty on one count of Conspiracy to Distribute Methamphetamine, three counts of Distribution of Methamphetamine, one count of Possession with Intent to Distribute Methamphetamine and one count of Felon in Possession of a Firearm following a two day jury trial. The Honorable Timothy L. Brooks presided over the trial in the United States District Court in Fayetteville.
According to evidence presented to the jury, during the course of an ongoing operation, investigators learned that Ramos was distributing suspected methamphetamine from his residence in Springdale. Detectives then obtained and executed a search warrant at the defendant’s residence. During the execution of the search warrant, methamphetamine, digital scales, plastic baggies, a large amount of U.S. currency, and a Kimber .45 caliber handgun were discovered. In a separate DEA investigation agents learned that Ramos was conspiring with others to distribute methamphetamine in the Northwest Arkansas area.
Ramos will be sentenced at a later date. The maximum sentence for Conspiracy to Distribute Methamphetamine and Distribution of Methamphetamine are not more than 30 years imprisonment, not more than $2,000,000 fine, or both. The maximum sentence for felon in possession of a firearm is not more than 10 years imprisonment, not more than $250,000 fine, or both. The sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, the defendant’s role in the offense, and the characteristics of the violations.
This case was investigated by the 4th Judicial Drug Task Force, the DEA and the ATF. Assistant United States Attorneys David Harris and Denis Dean prosecuted the case for the United States.
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Related court documents may be found on the Public Access to Electronic Records website @ www.pacer.gov
Joint Statement by Attorney General Loretta E. Lynch and Secretary of Homeland Security Jeh JohnsonRead the Press Release
We welcome recent progress made with the People’s Republic of China on cyber issues of concern to both the United States and China. Through the efforts of President Obama and President Xi Jinping, as well as officials from both sides, we have made several key commitments focused on concrete actions and arrangements to address our differences on cyber issues. These include:
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The United States and China committed that both sides should increase law enforcement communications regarding malicious cyber activities, including breaches of sensitive information, and provide timely responses to requests for information and assistance concerning those activities. Further, both sides agreed to provide updates to the other side on the status and results of those investigations and to take action, as appropriate.
- The United States and China committed that neither country’s government will conduct or knowingly support cyber-enabled theft of intellectual property, including trade secrets or other confidential business information, with the intent of providing competitive advantages to companies or commercial sectors.
As a means of ensuring that these commitments are upheld and responses are provided in a timely and comprehensive manner, the United States and China committed to establish a high-level joint dialogue mechanism on cybercrime and related issues. We will co-chair the dialogue for the United States, with participation from representatives of the FBI, the U.S. Intelligence Community and other agencies. China will designate an official at the Ministerial level to lead representatives from the Ministry of Public Security, Ministry of State Security, Ministry of Justice and the State Internet and Information Office. This dialogue will enable both sides to periodically assess our progress; address any issues related to investigative cooperation or information exchanges; and outline means for relevant agencies on both sides to enhance cooperation. Further, the two countries will establish a hotline to address urgent issues or difficulties that have not otherwise been successfully resolved. We look forward to scheduling the first session of this dialogue before the end of the calendar year.
We intend to remain personally engaged on these issues to ensure that both sides take concrete and reciprocal steps to advance progress made thus far. These commitments do not resolve all our challenges with China on cyber issues. However, they do represent a step forward in our efforts to address one of the sharpest areas of disagreement in the U.S.-China bilateral relationship. The United States is prepared to fulfill our commitments and make reciprocal efforts. We expect China to do the same and have been clear with the Chinese government that their words must be matched by actions.
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Iowa Man to Federal Prison for Firearm and Meth ConvictionsRead the Press Release
A man who conspired to distribute methamphetamine and illegally possessed a firearm was sentenced September 15, 2015, to ten years in federal prison.
William Dean Rees, 27, from Fort Dodge, Iowa, received the prison term after a May 5, 2015, guilty plea to one count of conspiracy to distribute methamphetamine and one count of possession of a firearm by a felon.
At the guilty plea, Rees admitted his involvement in a conspiracy from May 2014 through August 2014 that distributed more than 150 grams of actual (pure) methamphetamine. On August 18, 2014, law enforcement executed a search warrant at Rees’ residence and seized a number of items, including over 53 grams of actual (pure) methamphetamine, 9mm handgun, ammunition, digital scales, over $4,000, and other drug paraphernalia. Rees further admitted he had Jacob Jamison purchase two Hi-Point 9mm handguns for him as Rees was unable to purchase or possess firearms since he was a felon.
Rees was sentenced in Sioux City by United States District Court Judge Mark W. Bennett. Rees was sentenced to 120 months’ imprisonment. A special assessment of $200 was imposed. He must also serve a five-year term of supervised release after the prison term. There is no parole in the federal system. Rees is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Shawn S. Wehde and investigated by the Iowa Division of Narcotics Enforcement, Iowa Division of Criminal Investigation, Fort Dodge Police Department, Webster County Sheriff’s Office, Pocahontas Police Department, Pocahontas Sheriff’s Office, and Calhoun County Sheriff’s Office.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 14-3045.
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Indictment Charges 9 Individuals with Obtaining Oxycodone in Fraudulent Prescription SchemeRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, and Michael J. Ferguson, Special Agent in Charge of the Drug Enforcement Administration for New England, today announced that nine individuals have be charged by indictment with participating in a drug trafficking ring that obtained more than 80,000 oxycodone pills by way of fraudulent prescriptions.
“The diversion and trafficking of prescription narcotics is a serious threat to public health, and disrupting criminal organizations involved in this activity and prosecuting those involved is a priority of the U.S. Attorney’s Office,” said U.S. Attorney Daly. “I commend the DEA and all the members of the Tactical Diversion Squad for their efforts in this long-running investigation.”
“The DEA is committed to investigating and bringing to justice those who illicitly distribute oxycodone,” said DEA Special Agent in Charge Ferguson. “Opiate abuse is a major problem in Connecticut and throughout New England. The diversion of prescription pain killers, in this case oxycodone, contributes to the widespread abuse of opiates, is the gateway to heroin addiction, and is devastating our communities. This investigation demonstrates the strength of collaborative law enforcement efforts in Connecticut and our strong partnership with the U.S. Attorney’s Office to aggressively pursue any group that traffics these drugs.”
According to court documents and statements made in court, in 2012, members of the Drug Enforcement Administration’s New Haven Tactical Diversion Squad began an investigation into a drug trafficking organization that manufactured fraudulent prescriptions for oxycodone and distributed the drug in the greater New Haven area. As part of the conspiracy, members of organization obtained the personal identifying information of medical practitioners and used the information to create fraudulent prescriptions. Conspiracy members also purchased legitimate prescriptions for oxycodone from individuals. The organization then used individuals, or “runners,” to fill the fraudulent prescriptions at pharmacies throughout Connecticut. Once a runner provided his or her personal information to a member of the organization, the runner’s information was kept on file and used to create other fraudulent prescriptions.
Since February 2013, the organization has stolen the personal identifying information of more than 50 doctors and medical professionals and fraudulently obtained more than 80,000 oxycodone pills.
On September 22, 2015, a federal grand jury in New Haven returned a six-count indictment charging the following individuals:
JULIAN CINTRON, a.k.a. “Papi” and Jay,” 36, of New Haven
DAVID THOMPSON, a.k.a. “Super Dave,” 41, of New Haven
ALEJANDRINO DeJESUS, a.k.a. “Baby Boo,” 37, of New Haven
ANGEL MATEO, a.k.a., “Chickyding,” 36, of New Haven
ROBERT WILLIAMS, a.k.a., “Bo,” “Positive” and “Shawn,” 35, of Meriden
LARISSA ARABOLOS, 25, of East Haven
MATTHEW GIGLIETTI, 35, of East Haven
CHRISTOPHER LEVIX, a.k.a. “Scarface,” 33 of New Haven
ANTHONY PALMIERI, a.k.a. “Ant” and “Turtle,” 38, of New HavenAs alleged in court documents, CINTRON and THOMPSON have been leaders of the conspiracy since 2013. CINTRON, THOMPSON and ARABOLOS manufactured fraudulent oxycodone prescriptions for the organization, and DeJESUS, MATEO, WILLIAMS, GIGLIETTI and LEVIX recruited and transported runners. PALMIERI transported runners, and also distributed oxycodone obtained by CINTRON and THOMPSON.
The indictment charges each of the defendants with one count of conspiracy to distribute and to possess with intent to distribute oxycodone, an offense the carries a maximum term of imprisonment of 20 years, and one count of conspiracy to acquire oxycodone by fraud and forgery, an offense that carries a maximum term of imprisonment of four years.
The indictment also charges THOMPSON with two counts of possession with intent to distribute and distribution of oxycodone, and DeJESUS with one count of possession with intent to distribute and distribution of heroin and cocaine, and one count of possession with intent to distribute and distribution of heroin. Each of these charges carries a maximum term of imprisonment of 20 years.
CINTRON, THOMPSON, WILLIAMS, ARABOLOS, GIGLIETTI, LEVIX and PALMIERI were arrested on federal criminal complaints on September 10, 2015, and DeJESUS was arrested on a federal criminal complaint on September 11, 2015. MATEO currently is in state custody.
The indictment also seeks the forfeiture of $10,207.39 that was seized from PALMIERI’s residence on September 10, 2015, and five vehicles owned by several of the defendants.
U.S. Attorney Daly stressed that an indictment is not evidence of guilt. Charges are only allegations, and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
The DEA Tactical Diversion Squad includes members from the Greenwich, Shelton, Hamden, Vernon, West Hartford, Bristol and Willimantic Police Departments.
This case is being prosecuted by Assistant U.S. Attorneys Amy C. Brown and Robert M. Spector.
Health Care Plan Supervisor Submitted False Statements, Netted $184K in PaymentsRead the Press Release
PITTSBURGH – An Armstrong County resident pleaded guilty in federal court to charges of mail fraud and health care fraud, United States Attorney David J. Hickton announced today.
Francine Ann Priestas, 48, of Rural Valley, Pennsylvania, pleaded guilty to 11 counts before Senior United States District Judge Terrence F. McVerry.
In connection with the guilty plea, the court was advised that Priestas was employed as a supervisor in the UPMC Health Plan Claims Department. Priestas generated billing statements which falsely represented that she and others received medical services. She submitted 156 false statements on the UPMC system and received payments totaling $184,835.
Judge McVerry scheduled sentencing for Jan. 8, 2016 at 9:30 a.m. The law provides for a total sentence of 210 years in prison, a fine of $2,750,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Pending sentencing, the court continued Priestas on bond.
Assistant United States Attorney Robert S. Cessar is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation conducted the investigation that led to the prosecution of Priestas.