Latest Records
Newest first across public DOJ and U.S. Attorney press releases.
30 October 2015
South American Man who Illegally Trafficked in Protected Orchids on Layover at LAX Pleads Guilty to Federal Wildlife ChargeRead the Press Release
LOS ANGELES – A Peruvian national who possessed orchids in violation of an international wildlife treaty has pleaded guilty to a federal offense of illegal trade in a protected species.
Victor Manuel Arias Cucho, 46, of Lima, Peru, pleaded guilty to the offense Wednesday in United States District Court.
This case is the result of U.S. authorities discovering more than 200 protected orchids in Cucho’s luggage at Los Angeles International Airport. Cucho was flying from Australia to Peru on September 24, when he had a layover at LAX after attending an orchid trade show in Sydney.
The orchids are protected under the Convention on International Trade In Endangered Species of Wild Fauna and Flora (CITES), and Cucho was aware that he could not bring the CITES-protected orchids into the United States or Peru without having proper documentation. Knowing that he did not have the CITES-required documentation, Cucho concealed the orchids in various parts of his luggage in order avoid detection by customs authorities. Upon arriving at LAX, Cucho submitted a Customs declaration in which he denied that he was carrying any plants, and he was sent by customs authorities for a secondary agricultural inspection.
After pleading guilty on Wednesday, Cucho was sentenced by United States Magistrate Judge Karen L. Stevenson to two years of probation and was ordered to pay a $7,500 fine.
The case against Cucho is the product of an investigation by the U.S. Fish & Wildlife Service. U.S. Customs and Border Protection first discovered the orchids in Cucho’s luggage. The United States Department of Agriculture, Animal and Plant Health Inspection Service, Plant Protection and Quarantine Program provided assistance.
Shreveport resident pleads guilty to receiving child pornographyRead the Press Release
SHREVEPORT, La. – United States Attorney Stephanie A. Finley announced that a Shreveport resident pleaded guilty Thursday to receiving child pornography.
Byron Morris, 57, of Shreveport, pleaded guilty before U.S. District Judge S. Maurice Hicks Jr. to one count of receiving child pornography. According to evidence presented at the guilty plea, law enforcement officers detected someone downloading and sharing child pornography in August of 2014 in Shreveport on a computer. After further investigation, officers were led to Morris’ residence, which was searched, and pornography was found on computers and other electronic storage media he owned.
Morris faces five to 20 years in prison, not less than five years of supervised release, a $250,000 fine, mandatory registration as a sex offender and forfeiture of property seized during the investigation. A sentencing date of February 17, 2016 was set.
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 combines 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.
The U.S. Department of Homeland Security/Homeland Security Investigations/Immigration & Customs Enforcement (ICE) also encourages 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 by visiting their website at www.ice.gov/exec/forms/hsi-tips/tips.asp or through the Operation Predator smartphone application (http://www.ice.gov/predator/smartphone-app). Tips also may be submitted anonymously.
Homeland Security Investigations and Louisiana State Police conducted the investigation. Assistant U.S. Attorney Brandon B. Brown is prosecuting the case.
Shooter of Off-Duty MPD Officer Indicted on Federal ChargesRead the Press Release
Memphis, TN – A man responsible for fatally shooting an off-duty Memphis Police officer has been indicted federally, along with his wife. Edward L. Stanton III, U.S. Attorney for the Western District of Tennessee, announced the indictment today.
According to the indictment, Lorenzo Clark, 36, of Memphis, unlawfully possessed a Glock 9mm pistol on Sunday, October 11, 2015. The firearm was reportedly used by the defendant in the fatal shooting of 31-year-old Terence Olridge, an officer with the Memphis Police Department (MPD). Olridge was off duty at the time of the shooting.
According to the federal complaint, MPD officers responded to a shooting call at Lorenzo Clark’s Cordova residence. Officers later recovered the Glock 9mm alleged to be used in the shooting from the defendant. Lorenzo Clark gave a post-Miranda statement admitting to possession of the Glock 9mm prior to and during the shooting with Olridge. After searching Clark’s home, law enforcement recovered two additional firearms – a Colt 5.56mm rifle and an Escort 12 gauge shotgun.
Lorenzo Clark’s wife, Natalie Clark, 37, of Memphis, has also been charged in the indictment. Between February 2012 and October 2015, Natalie Clark provided three firearms — a Glock 9mm, Escort 12 gauge and Colt 5.56mm rifle — to her husband despite knowing he had been convicted of a felony, according to the indictment.
Lorenzo Clark has been charged with three counts of felony possession of a firearm. He faces up to 10 years imprisonment and a fine of up to $250,000 on each count.
Natalie Clark has been charged with three counts of disposing of a firearm to a felon. She faces up to 10 years imprisonment and a fine of up to $250,000 on each count.
The case is being investigated by the MPD and Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).
Assistant U.S. Attorney Marques Young is prosecuting the case on the government’s behalf.
The charges and allegations contained in the indictment are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Sentencing for October 23, 2015Read the Press Release
Jeffrey Dale Harrison, 28, of Rock Springs, Wyoming, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on October 23, 2015, for being an unlawful user of a controlled substance in possession of a firearm and possession of a firearm by a prohibited person subject to domestic violence protective order. Harrison was arrested in Sweetwater County, Wyoming. He received 42 months imprisonment, to be followed by three years of supervised release, and was ordered to pay a $400.00 fine and a $100.00 special assessment. This case was investigated by the Rock Springs Police Department, the Sweetwater County Sheriff’s Office and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Robert Schueller Sentenced to Five Years in Prison for Sending Threatening CommunicationRead the Press Release
United States Attorney Andrew M. Luger today announced the sentencing of ROBERT JAMES SCHUELLER, 30, to five years in prison. SCHUELLER was charged by Information and pleaded guilty on May 26, 2015, to devising a plot to harm his former paramour’s fiancé. He was sentenced today by U.S. District Judge Richard H. Kyle in United States District Court in St. Paul, Minn.
According to the defendant’s guilty plea and documents filed in court, SCHUELLER, then vice-president of Nomad Pipeline (Nomad) and married to then president M.S., had an extra-marital affair with an employee of Nomad’s sister company. Approximately three months after R.T. ended the relationship with SCHUELLER, SCHUELLER learned that R.T. was in a relationship with C.A. Therefore, SCHUELLER began attempting to win back R.T.’s affections. When the defendant was unable to win back R.T., he began pursuing various schemes to get C.A. out of the picture and away from R.T.
According to the defendant’s guilty plea and documents filed in court, on February 6, 2014, SCHUELLER called W.E., another Nomad employee, and asked if W.E. stayed in contact with any of his prison contacts because SCHUELLER had a guy that needed to “go away.” Over the course of several months, SCHUELLER and W.E. communicated back and forth concerning the defendant’s desire to find someone willing to harm C.A. Once W.E. provided SCHUELLER a specific name as a possible person who could injure C.A., SCHUELLER sent W.E. a package containing $10,000 in cash and a business card, on which C.A.’s name was written. On May 2, 2014, W.E. informed SCHUELLER that he was unable to find someone to carry out the plot to injure C.A. and then returned the $10,000 to SCHUELLER. After this conversation, SCHUELLER texted W.E. and instructed him to burn the business card.
According to the defendant’s guilty plea and documents filed in court, SCHUELLER admitted to attempting to contact several other Nomad employees seeking their assistance in causing bodily injury to C.A. SCHUELLER further admitted to plotting various seduction schemes in an attempt to break-up C.A. and R.T. For example, in January 2014, SCHUELLER paid his sister-in-law $500 to seduce C.A.; and in May 2014, SCHUELLER posted a Craigslist ad titled “Girls – 1 time $5,000 cash offer” that sought a “pretty girl” to “break up a couple by any means necessary” and offered payment for such services.
This case was the result of an investigation conducted by the Federal Bureau of Investigation and the Stearns County Sheriff’s Office.
This case was prosecuted by Assistant United States Attorneys Julie E. Allyn and Steven L. Schleicher of the Special Prosecutions Section of the U.S. Attorney’s Office.
Defendant Information:
ROBERT JAMES SCHUELLER, 30
Farming Township, Minn.
Convicted:
-
Threats Transmitted by Interstate Communication, 1 count
Sentenced:
-
Five years in prison
###
Additional news available on our website.
Follow us on Twitter and Facebook.
United States Attorney’s Office, District of Minnesota: (612) 664-5600
-
Richmond County Defendants Sentenced in Methamphetamine ConspiracyRead the Press Release
GREENSBORO, N.C. – Nine of the fifteen defendants convicted in the Phillip McGee methamphetamine conspiracy were sentenced on October 29-30, 2015, in federal court in Greensboro by the Honorable Catherine C. Eagles, United States District Judge. The group, which operated in Richmond County between 2012 and 2015, was responsible for the manufacture and distribution of large amounts of methamphetamine during this time period.
Phillip Allen McGee was sentenced to 234 months in the Federal Bureau of Prisons, followed by a three year term of supervised release.
Thomas Leslie Snead, Jr., was sentenced to 160 months in the Federal Bureau of Prisons, followed by a three year term of supervised release.
Thomas Brantley Jenkins, II, was sentenced to 150 months in the Federal Bureau of Prisons, followed by a three year term of supervised release.
Christopher Jared Jenkins was sentenced to 69 months in the Federal Bureau of Prisons, followed by a three year term of supervised release.
Tracy Alan McDonald was sentenced to 59 months in the Federal Bureau of Prisons, followed by a three year term of supervised release.
Jason Franklin Jacobs was sentenced to 69 months in the Federal Bureau of Prisons, followed by a three year term of supervised release.
Nickolas Craig Smith was sentenced to 70 months in the Federal Bureau of Prisons, followed by a three year term of supervised release.
Cayce Leigh Honeycutt was sentenced to 41months in the Federal Bureau of Prisons, followed by a three year term of supervised release.
Taylor Dawn Loftus was sentenced to 24 months in the Federal Bureau of Prisons, followed by a three year term of supervised release.
Remaining defendants in this case are scheduled for sentencing on November 12, 2015, November 19, 2015, and December 1, 2015.
In a related case, on October 23, 2015, John David McCuiston was sentenced by the Honorable Loretta C. Biggs, United States District Judge, to a term of 135 months in the Federal Bureau of Prisons, followed by a three year term of supervised release. McCuiston had earlier pleaded guilty to conspiracy to possess pseudoephedrine knowing or having reasonable cause to believe it would be used to manufacture methamphetamine.
In another related case, on September 30, 2015, Sandra Martin Leviner was sentenced by the Honorable James A. Beaty, Jr., United States District Judge, to a term of 24 months in the Federal Bureau of Prisons, followed by a three year term of supervised release. Leviner had earlier pleaded guilty to possession of pseudoephedrine knowing or having reasonable cause to believe it would be used to manufacture methamphetamine.
These cases were investigated by the North Carolina State Bureau of Investigation, the Richmond County Sheriff’s Office, and the Rockingham Police Department.
###
President of New Jersey-Based Textile Company Sentenced to Three Years in Prison for Defrauding Investors Out of $4 MillionRead the Press Release
NEWARK, N.J. – A Mahwah, New Jersey, woman was sentenced today to 36 months in prison for pretending to be an employee of the United States in order to defraud investors out of $4 million, U.S. Attorney Paul J. Fishman announced.
Sara Rong Liu, 54, previously pleaded guilty before U.S. District Judge Susan D. Wigenton to an information charging her with one count of falsely assuming or pretending to be an employee of the United States and obtaining money as a result of her impersonation. Judge Wigenton imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
Liu was the president of Westone Inc., a company purportedly involved in the wholesale distribution of textiles as well as interior design. Liu falsely represented to prospective victim investors, among other things, that Westone had been awarded a lucrative $156.6 million contract by the New York City Department of Design and Construction Fund (NYC DDC).
The NYC DDC never awarded the defendant or her company any such contract.
Liu falsely represented to the victim investors that there was a problem with the fictitious contract that required Westone to pay certain fees before the NYC DDC would release contract payments to the defendant and her company.
To support her false claims, Liu created, or caused to be created, a number of fictitious documents, including documents purportedly from, among others: the NYC DDC, which stated she had been awarded the contract to provide ADesign, Construction, and Construction Support Services for the Design, Manufacture, and Supply of Good Quality Home & Office Interior Textile Products and Finishing” in and around the New York metropolitan area; the Federal Reserve Bank of New York; the U.S. Department of Treasury; the FBI; and the U.S. Attorney=s Office for the Southern District of New York, among others. Liu emailed a number of these documents to the victim investors from whom she solicited funds. She characterized the funds as short-term loans, which would be repaid immediately upon the release of the first contract payment of $52.2 million from the NYC DDC.
In all, the defendant obtained more than approximately $4 million in illegitimate proceeds from victim investors.
In addition to the prison term, Judge Wigenton sentenced Liu to serve one year of supervised release and pay $4,220,185 in restitution.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Richard M. Frankel in Newark, and the U.S. Treasury Department, Office of the Treasury Inspector General for Tax Administration, under the direction of Special Agent in Charge Rodney Davis, Washington Field Division, with the investigation leading to today’s sentencing.
The government is represented by Chief Gurbir Grewal and Assistant U.S. Attorney Lakshmi Srinivasan Herman of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.stopfraud.gov.
Defense counsel: Assistant Federal Public Defender Lisa Mack Esq., Newark
Port Orchard Man Sentenced to Four Years in Prison for Wire Fraud and Tax Evasion Scheme that Cheated State Out of Millions in Tobacco TaxesRead the Press Release
The owner and manager of a tobacco wholesaling company, CP Trading Company, was sentenced today in U.S. District Court in Tacoma to 48 months in prison for wire fraud and tax evasion, announced U.S. Attorney Annette L. Hayes. HYUN SEUNG KIM, 45, was ordered to pay nearly $2.5 million in restitution to the state of Washington for tobacco taxes owed and $294,922 to the U.S. Treasury for taxes he failed to pay on unreported income between 2009 and 2013. At sentencing U.S. District Judge Ronald B. Leighton told him “you knew it was wrong because you went to such extremes to manipulate the system, always deflecting attention from yourself to others.”
“When this defendant sold untaxed tobacco products, he acted as though the rules did not apply to him,” said U.S. Attorney Annette L. Hayes. “In the process he undercut those who sold properly taxed tobacco products—many of whom are small business owners. He also failed to pay his fair share into state coffers – funds used to support education, health care and other important programs. I commend the criminal investigators for their work on this case.”
According to records filed in the case, between 2009 and 2015, KIM’s company purchased and distributed wholesale non-cigarette tobacco products to retailers in Pierce, Mason, Kitsap and Thurston Counties. Using cash, KIM would purchase substantial amounts of tobacco products from a smoke shop on the Puyallup Indian Reservation. KIM would purchase a small portion of the product using checks. KIM reported the purchases made by check to the state Department of Revenue and paid the tax on those purchases. He did not report the cash purchases. KIM’s company sold the products to various retail outlets – again failing to report the cash sales. KIM had various relatives open bank accounts so that he could deposit the cash in their names to hide it from regulators. By dealing in cash KIM avoided paying state taxes on the tobacco products and also avoided paying federal income taxes. For example, in 2013 KIM claimed his taxable income was $8,000 so that he owed tax of just $593. In fact KIM earned more than $200,000 from CP Trading Company and owed more than $50,000 in federal income tax.
“Tax evasion is nothing short of stealing; stealing from the US Treasury, but more significantly, stealing from all the honest taxpayers who are paying their fair share,” said Special Agent in Charge Teri Alexander of IRS Criminal Investigation. “The central mission of the IRS is to protect the integrity of our nation’s tax code, and we will diligently pursue those who shirk their civic duty by violating federal and state tax laws.”
The case was investigated by the Internal Revenue Service Criminal Investigation, the Washington State Department of Revenue and the Washington State Liquor and Cannabis Board. The case was prosecuted by Assistant United States Attorney Matthew Diggs.
Plymouth Man Sentenced in Child Exploitation ChargesRead the Press Release
BOSTON – A Plymouth man was sentenced today in U.S. District Court in Boston for possessing and distributing child pornography.
Brendan R. Kessler, 25, was sentenced by U.S. District Court Judge Nathaniel M. Gorton to 63 months in prison, five years of supervised release, and a $200 special assessment fee. In March 2015, he pleaded guilty to distribution and possession of child pornography.
On Sept. 2, 2014, after law enforcement became aware that Kessler had posted child pornography to a public file sharing program known as Lime Wire, federal agents executed a search warrant on Kessler’s residence in Plymouth and seized a computer and various digital storage devices containing multiple images and videos of child pornography. Federal agents also located multiple boxes of fireworks, detonator cords, remote firing switches, a hand-written journal titled “Mass Murder Book,” and lists of chemicals needed to create explosive powder. Additionally, in an upstairs bedroom, agents located 14 firearms (3 semi-automatic pistols, 3 shotguns, and 8 rifles) and multiple boxes of ammunition. Kessler was arrested following the execution of the search warrant and has been held in federal custody since.
United States Attorney Carmen M. Ortiz; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Colonel Richard D. McKeon, Superintendent of the Massachusetts State Police; and Plymouth Police Chief Michael E. Botieri, made the announcement today. The case is being prosecuted by Kenneth G. Shine of Ortiz’s Major Crimes Unit.
The case is brought as part of Project Safe Childhood. In 2006, the Department of Justice created Project Safe Childhood, a nationwide initiative designed to protect children from exploitation and abuse. Led by the U.S. Attorneys’ Offices and the DOJ’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, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Members of the public who have questions, concerns or information regarding this case should call 617-748-3274.
Pennsylvania man convicted of heroin traffickingRead the Press Release
CLARKSBURG, WEST VIRGINIA – Rholan D. Pryor, 25, of Pittsburgh, Pennsylvania, was convicted of heroin trafficking today in federal court, United States Attorney William J. Ihlenfeld, II, announced.
Pryor, also known as “G,” sold heroin in April 2014 in Harrison County, West Virginia. He pled guilty today to one count of “Distribution of Heroin – Aiding and Abetting.” He faces up to 20 years in prison and a fine of up to $1,000,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Andrew Cogar prosecuted the case on behalf of the government. The Greater Harrison County Drug and Violent Crime Task Force, a HIDTA-funded initiative, and the West Virginia State Police investigated.
U.S. Magistrate Judge Michael John Aloi presided.
Pennsylvania Man Pleads Guilty to Running Sex Trafficking Operation to Compel Multiple Women and One Minor into Prostitution in Pennsylvania, Maryland and ElsewhereRead the Press Release
Corderro Cody, 27, of Allentown, Pennsylvania, pleaded guilty today to charges arising from his operation of a sex trafficking enterprise that compelled multiple victims to prostitute for the defendant’s profit. Cody pleaded guilty to conspiracy to commit sex trafficking by force, fraud or coercion, conspiracy to transport individuals both intrastate and interstate for the purpose of prostitution, one count of sex trafficking of a minor and 12 counts of sex trafficking by force, fraud and coercion.
According to documents filed in the case and evidence presented in court during the plea hearing, from 2009 until the time of his arrest in 2014, the defendant, conspiring at various times with others, used false promises to recruit his victims into relationships with him, then used psychological manipulation, addictive drugs, sexual assaults and brutal violence to control and coerce them for purposes of prostituting them for his profit. Cody also denied a victim access to her child as another form of coercion and control.
As set forth in documents filed in the case, Cody recruited multiple women to prostitution, referring to his prostitution enterprise as the “program,” and advertised the women for commercial sex acts on Backpage.com. Cody transported them both within Pensnylvania and to other states to prostitute, and he controlled and retained virtually all of the prostitution proceeds. Cody also used physical force and violent beatings when the women did not adhere to the “program,” in order to maintain the women for continued commercial sexual acts at his direction.
“Human trafficking is a crime that deprives vulnerable individuals of their freedom and dignity,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division. “This defendant engaged in a concerted scheme of cruelty and brutality to compel and coerce his victims to sell their bodies for his profit. This disregard for their humanity is an affront to our values as a nation, and the Civil Rights Division is deeply committed to bringing traffickers to justice to vindicate the rights and dignity of survivors of human trafficking in all its forms.”
“A dozen victims of this sex trafficker have the opportunity to rebuild their lives and countless other potential victims will no longer fall prey to his abuse,” said Special Agent in Charge John Kelleghan of U.S Immigration and Customs Enforcement-Homeland Security Investigations (ICE-HSI) in Philadelphia. “This case is a result of the excellent relationship between HSI special agents and local police officers who continuously work together to root out this type of violent activity to keep communities safe."
U.S. District Court Judge Edward G. Smith of the Eastern District of Pennsylvania scheduled a sentencing hearing for Jan. 29, 2016. Cody faces a mandatory minimum prison term of 15 years and a maximum of life, a fine of up to $3.75 million, a mandatory minimum of five years of supervised release and up to a lifetime of supervised release and a $1,500 special assessment.
The case was investigated by ICE-HSI and the Allentown Police Department. The case is being prosecuted by Assistant U.S. Attorney Sherri A. Stephan of the Eastern District of Pennsylvania and Trial Attorney Anita Channapati of the Civil Rights Division’s Human Trafficking Prosecution Unit.
Ohio woman pleads guilty in Federal court to passing counterfeit moneyRead the Press Release
BECKLEY, W.Va. – United States Attorney Booth Goodwin announced that Paula K. Green, 42, of Columbus, Ohio, pleaded guilty today in federal court in Beckley to passing counterfeit $100 bills. Green admitted to passing the counterfeit money in Beckley and Charleston, West Virginia. In Beckley, Green passed the counterfeit bills at the Crossroads Mall and the K-Mart at the Plaza Mall located off Robert C. Byrd Drive. In Charleston, Green passed the bills at K-Mart on MacCorkle Avenue.
As a result of her plea to three felony counts, Green faces a penalty of up to 60 years in federal prison and a fine of $750,000. Sentencing has been scheduled for February 11, 2016 at the federal courthouse in Beckley.
In related cases, three other women, O’wynn Rogers, of Beckley, Kenyata Smith, of Beckley, and Nyteria Green, of Columbus, Ohio, previously pled guilty to passing counterfeit $100 bills. Smith was sentenced to two years of supervised probation on October 21, 2015. Rogers and Green are both scheduled to be sentenced on December 2, 2015, at the federal courthouse in Beckley.
The investigation in all of these matters was conducted by the United States Secret Service. Assistant United States Attorney Eric Bacaj is handling the prosecution.
- Follow us on Twitter: SDWVNews
North Ridgeville man sentenced to 15 years in prison for child pornography crimesRead the Press Release
A North Ridgeville man was sentenced to 15 years in prison related to distribution of child pornography, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the FBI's Cleveland office.
Sean M. Barnhill, 37, was previously convicted of distributing and possessing visual depictions of minors engaged in sexually explicit conduct.
Barnhill knowingly received and distributed, by computer, numerous computer files, which contained visual depictions of real minors engaged in sexually explicit conduct. This took place from August 1, 2014, through August 30, 2014. Barnhill accessed with intent to view images of child pornography on his computer between September 1, 2013 and January 8, 2015, according to court documents
This case is being prosecuted by Assistant United States Attorney Carol M. Skutnik. The case was investigated by the Federal Bureau of Investigation, Elyria Office.
North Carolina Man Sentenced for Transporting Women for ProstitutionRead the Press Release
NORFOLK, Va. – Dana O. Knight, 33, of Gates, North Carolina, was sentenced today to 240 months in prison and lifetime supervised release for transporting multiple women to Virginia for prostitution.
Knight pleaded guilty on July 15, 2015. Court documents reflect that, over the course of one year, Knight transported at least three women to Virginia and other locations for purposes of furthering his prostitution business. One victim was transported by Knight to locations in North Carolina, New York, Pennsylvania, Washington, D.C., and elsewhere before ultimately being brought to Virginia. Knight used various internet resources to advertise the services of the women who worked for him. Knight was physically violent towards his victims and beat one woman so badly that she was hospitalized on multiple occasions. In November 2014, Knight was arrested in Virginia Beach after one of his victims called 911 seeking emergency assistance. Prior to his arrest on these charges, Knight had been involved in the prostitution business for nearly nine years, making approximately $20,000 per month.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; John S. Adams, Special Agent in Charge of the FBI’s Norfolk Field Office; and James A. Cervera, Virginia Beach Chief of Police, made the announcement after sentencing by U.S. District Judge Arenda L. Wright Allen. Assistant U.S. Attorney V. Kathleen Dougherty and Elizabeth M. Yusi prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:15cr26.
###
Nine Charged in Interstate Human Trafficking ConspiracyRead the Press Release
PANAMA CITY, FLORIDA – A federal grand jury returned a 32-count indictment charging nine defendants, all residing in the United States illegally, in an interstate human trafficking case. The defendants were arrested yesterday in the Northern District of Florida and other locations. Their initial appearances in federal court took place yesterday and today. The indictment was announced by Christopher P. Canova, Acting United States Attorney for the Northern District of Florida.
The defendants are:
- Edegardo Osorno Rodriguez, 37, Santa Rosa Beach, Florida;
- Antonio Flores-Esparza, 31, Pensacola, Florida;
- Jose Juan Ruiz Prudencio, 40, Montgomery, Alabama;
- Jose Alvaro Trujillo-Santiz, 45, Panama City Beach, Florida;
- Rosa Mirtha Cruz Vidal, 34, Santa Rosa Beach, Florida;
- Mauro Gonzalez-Lira, 24, McComb, Mississippi;
- Romon Tobon, 45, Starkville, Mississippi;
- Lazaro Juarez-Juarez, 33, Atlanta, Georgia; and
- Emerson Corvera, 30, Montgomery, Alabama.
The indictment alleges that, between July 2014 and August 2015, the defendants engaged in a conspiracy to transport, harbor, and market female aliens for prostitution in Florida, Alabama, Mississippi, and Louisiana, and thereafter, wired the prostitution proceeds outside the United States. In addition to the conspiracy, the defendants are also charged with: 13 counts of enticing individuals to travel in interstate commerce to engage in prostitution; 4 counts of money laundering; 7 counts of transporting individuals in interstate commerce to engage in prostitution; 6 counts of harboring an alien for the purpose of prostitution; and illegal entry by a deported alien. The trial is scheduled for January 4, 2016, at 8:15 a.m.
As part of this investigation, federal agents executed six search warrants yesterday at the following locations: two in Pensacola, one in Santa Rosa Beach, one in Panama City Beach, one in Montgomery, Alabama, and one in Laurel, Mississippi.
This case resulted from a 15 month investigation into human trafficking activities in the Northern District of Florida by the Federal Bureau of Investigation and the United States Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI)-Panama City Resident Agent in Charge. It is a follow-up prosecution to a previous kidnapping case prosecuted in federal court in Panama City. The case is being prosecuted by Assistant United States Attorneys Stephen M. Kunz and Kathryn D. Risinger.
An indictment is merely an allegation by a grand jury that a defendant has committed a violation of federal criminal law and is not evidence of guilt. All defendants are presumed innocent and entitled to a fair trial, during which it will be the government’s burden to prove guilt beyond a reasonable doubt at trial.
The United States Attorney's Office for the Northern District of Florida is one of 94 offices that serve as the nation’s principal litigators under the direction of the Attorney General. The office strives to protect and serve the citizens of the Northern District of Florida through the ethical, vigorous, and impartial enforcement of the laws of the United States, to defend the national security, to improve the safety and quality of life in our communities through the protection of civil rights, and to protect the public funds and financial assets of the United States. To access public court documents online, please visit the U.S. District Court for the Northern District of Florida website. For more information about the United States Attorney’s Office, Northern District of Florida, visit http://www.justice.gov/usao/fln/index.html.
For more information, contact: Amy Alexander, Public Information Officer
(850) 216-3854, [email protected]Newton Investment Adviser Pleads Guilty to FraudRead the Press Release
BOSTON – A Newton investment adviser pleaded guilty today in U.S. District Court in Boston to defrauding clients out of more than $1.3 million.
Paul J. Jackson, 59, of Wellesley, pleaded guilty to an Information charging him with one count of investment adviser fraud and one count of wire fraud. United States District Court Judge F. Dennis Saylor, IV scheduled sentencing for Feb. 12, 2016.Jackson owned and operated Paul J. Jackson & Associates, LLC in Newton, through which he managed retirement funds for clients. Beginning in 2010, Jackson started offering clients, mostly friends and family members, what appeared to be attractive investment opportunities. The investments Jackson offered typically involved initial public offerings (IPOs) of high-profile companies, but Jackson did not invest the money as promised. Instead, he took over $1 million dollars of investor money for his own use. For example, Jackson took $175,000 from one investor to whom he had pitched a lucrative investment in Alibaba’s IPO. Instead of investing the money, Jackson took $112,000 for himself, and gave $60,000 to another investor who had given Jackson more than $450,000 and was demanding his money. When investors requested their money back, Jackson offered excuses and never told them that he had simply taken their money.
The charge of investment adviser fraud provides for a sentence of no greater than five years in prison, three years of supervised release and a fine of $250,00 or twice the gross gain or loss, whichever is greater. The charge of wire fraud provides for a sentence of no greater than 20 years in prison, three years of supervised release and a fine of $250,00 or twice the gross gain or loss, whichever is greater. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
The Massachusetts Securities Division previously filed a separate administrative action against Jackson, charging him with fraud and seeking to bar him from working in the securities industry.
United States Attorney Carmen M. Ortiz and Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division, made the announcement today. The United States Attorney’s Office received valuable assistance from the Securities & Exchange Commission during the investigation of this matter. The case is being prosecuted by Assistant U.S. Attorney Eric P. Christofferson of Ortiz’s Economic Crimes Unit.
New Jersey Woman and Her Parents Convicted in Multi-Million Dollar Mortgage FraudRead the Press Release
PHILADELPHIA – A federal jury, yesterday, returned guilty verdicts against a Cherry Hill, NJ woman and her parents for a mortgage fraud scheme that stripped the equity from the homes of desperate homeowners facing foreclosure. Silver Buckman, 37, of Cherry Hill, NJ, her parents, Vincent Foxworth, 70, and Cynthia Foxworth, 64, of Turnersville, NJ, were found guilty of bank fraud, wire fraud, and conspiracy to commit bank fraud and wire fraud. Their scheme caused losses to mortgage lenders of approximately $3.8 million. U.S. District Court Judge R. Barclay Surrick scheduled a sentencing hearing for January 29, 2016.
The defendants offered to help financially-vulnerable individuals save their homes from foreclosure or obtain money from the equity in their homes but, instead, defrauded the homeowners and mortgage lenders. Buckman owned and operated Fresh Start Financial Services (“FSFS”), in Mount Laurel, NJ and was an employee of American Home Lending as well as a mortgage broker for American One Mortgage (“AOM”). Her father is an experienced Realtor.
Between October 2006 and November 2009, Buckman and her co-defendants allegedly targeted financially vulnerable homeowners and represented to them that they could improve their credit, save their homes from foreclosure, or provide them with money through Buckman’s lease buyback program. The homeowners were told that “investors” would be used to temporarily refinance their homes and that they could repurchase the homes in one year, or once they regained their financial footing. The defendants also allegedly induced the homeowners into signing documents related to the sale and lease of their homes by their representations that the homeowners would remain on the title to their homes, that the equity from their homes would be placed into an individual escrow account in their names, and that new mortgages would be paid from the escrow accounts to establish their timely payment histories.
In order to carry out the scheme, Buckman recruited Vincent Foxworth and Cynthia Foxworth and others to be straw borrowers. Buckman submitted false financial and employment information about the straw borrowers to mortgage lenders. Once lenders agreed to fund the mortgage loans, Buckman prevented the homeowners from receiving the settlement proceeds and did not put money into escrow accounts for the homeowners. Instead, the defendants distributed the proceeds amongst themselves. Buckman used only a fraction of the homeowners’ monies toward the payment of the mortgages obtained by the straw borrowers for the homeowners’ homes and thereby caused the loans to go into default.
The defendants each face a potential advisory sentencing guideline range of approximately 87 to 108 months in prison plus restitution.
The case was investigated by the Federal Bureau of Investigation, the United States Postal Inspection Service and IRS Criminal Investigations. It is being prosecuted by Assistant United States Attorney Anita Eve.
Neptune Beach Man Sentenced to More Than Seven Years for Transporting and Receiving Child PornographyRead the Press Release
Jacksonville, Florida – United States District Judge Brian J. Davis yesterday sentenced Robert Earl Rice (48, Neptune Beach) to seven years and six months in federal prison for transporting and possessing child pornography, to be followed by 10 years of supervised release. Rice pleaded guilty on June 24, 2015.
According to court records, Rice used his email address to trade and receive videos of child pornography. He admitted to viewing and collecting child pornography from 2012 until April 2014, and he also admitted to using search terms to find child pornography on the Internet.
“Crimes against our children are deplorable and HSI special agents will not rest until these criminals are brought to justice,” said Susan L. McCormick, special agent in charge of HSI Tampa.
This case was investigated by the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. It is being prosecuted by Assistant United States Attorney Kelly S. Karase.
It is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Nearly 500 Hospitals Pay United States more than $250 Million to Resolve False Claims Act Allegations Related to Implantation of Cardiac DevicesRead the Press Release
WASHINGTON – The Department of Justice has reached 70 settlements involving 457 hospitals in 43 states for more than $250 million related to cardiac devices that were implanted in Medicare patients in violation of Medicare coverage requirements, the Department of Justice announced today.
“While recognizing and respecting physician judgment, the department will hold accountable hospitals and health systems for procedures performed by physicians at their facilities that fail to comply with Medicare billing rules,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “We are confident that the settlements announced today will lead to increased compliance and result in significant savings to the Medicare program while protecting patient health.”
An implantable cardioverter defibrillator, or ICD, is an electronic device that is implanted near and connected to the heart. It detects and treats chaotic, extremely fast, life-threatening heart rhythms, called fibrillations, by delivering a shock to the heart, restoring the heart’s normal rhythm. It is similar in function to an external defibrillator (often found in offices and other buildings) except that it is small enough to be implanted in a patient’s chest. Only patients with certain clinical characteristics and risk factors qualify for an ICD covered by Medicare.
Medicare coverage for the device, which costs approximately $25,000, is governed by a National Coverage Determination (NCD). The Centers for Medicare and Medicaid Services implemented the NCD based on clinical trials and the guidance and testimony of cardiologists and other health care providers, professional cardiology societies, cardiac device manufacturers and patient advocates. The NCD provides that ICDs generally should not be implanted in patients who have recently suffered a heart attack or recently had heart bypass surgery or angioplasty. The medical purpose of a waiting period -40 days for a heart attack and 90 days for bypass/angioplasty - is to give the heart an opportunity to improve function on its own to the point that an ICD may not be necessary. The NCD expressly prohibits implantation of ICDs during these waiting periods, with certain exceptions. The Department of Justice alleged that from 2003 to 2010, each of the settling hospitals implanted ICDs during the periods prohibited by the NCD.
“The settlements announced today demonstrate the Department of Justice’s commitment to protect Medicare dollars and federal health benefits,” said U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida. “Guided by a panel of leading cardiologists and the review of thousands of patients’ charts, the extensive investigation behind the settlements was heavily influenced by evidence-based medicine. In terms of the number of defendants, this is one of the largest whistleblower lawsuits in the United States and represents one of this office’s most significant recoveries to date. Our office will continue to vigilantly protect the Medicare program from potential false billing claims.”
“Working as a team with the Department of Justice to investigate and settle false billing claims of this magnitude has resulted in substantial recoveries to Medicare and the successful enforcement of Medicare’s coverage requirements for these procedures,” said Inspector General Daniel Levinson of the Department of Health and Human Services’ Office of Inspector General (HHS-OIG).
The 70 settlements, representing nearly 500 hospitals, are listed on the attached chart. Most of the settling defendants were named in a qui tam, or whistleblower, lawsuit brought under the False Claims Act, which permits private citizens to bring lawsuits on behalf of the United States and receive a portion of the proceeds of any settlement or judgment awarded against a defendant. The lawsuit was filed in federal district court in the Southern District of Florida by Leatrice Ford Richards, a cardiac nurse, and Thomas Schuhmann, a health care reimbursement consultant. The whistleblowers have received more than $38 million from the settlements. The Department of Justice is continuing to investigate additional hospitals and health systems.
The settlements were the result of a coordinated effort among the U.S. Attorney’s Office of the Southern District of Florida, the Civil Division’s Commercial Litigation Branch and HHS-OIG, Office of Investigations and Office of Counsel to the Inspector General.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $26.2 billion through False Claims Act cases, with more than $16.4 billion of that amount recovered in cases involving fraud against federal health care programs.
The claims resolved by these settlements are allegations only and there has been no determination of liability.
Nearly 500 Hospitals Pay United States More Than $250 Million to Resolve False Claims Act Allegations Related to Implantation of Cardiac DevicesRead the Press Release
The Department of Justice has reached 70 settlements involving 457 hospitals in 43 states for more than $250 million related to cardiac devices that were implanted in Medicare patients in violation of Medicare coverage requirements, the Department of Justice announced today.
“While recognizing and respecting physician judgment, the department will hold accountable hospitals and health systems for procedures performed by physicians at their facilities that fail to comply with Medicare billing rules,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “We are confident that the settlements announced today will lead to increased compliance and result in significant savings to the Medicare program while protecting patient health.”
An implantable cardioverter defibrillator, or ICD, is an electronic device that is implanted near and connected to the heart. It detects and treats chaotic, extremely fast, life-threatening heart rhythms, called fibrillations, by delivering a shock to the heart, restoring the heart’s normal rhythm. It is similar in function to an external defibrillator (often found in offices and other buildings) except that it is small enough to be implanted in a patient’s chest. Only patients with certain clinical characteristics and risk factors qualify for an ICD covered by Medicare.
Medicare coverage for the device, which costs approximately $25,000, is governed by a National Coverage Determination (NCD). The Centers for Medicare and Medicaid Services implemented the NCD based on clinical trials and the guidance and testimony of cardiologists and other health care providers, professional cardiology societies, cardiac device manufacturers and patient advocates. The NCD provides that ICDs generally should not be implanted in patients who have recently suffered a heart attack or recently had heart bypass surgery or angioplasty. The medical purpose of a waiting period -40 days for a heart attack and 90 days for bypass/angioplasty - is to give the heart an opportunity to improve function on its own to the point that an ICD may not be necessary. The NCD expressly prohibits implantation of ICDs during these waiting periods, with certain exceptions. The Department of Justice alleged that from 2003 to 2010, each of the settling hospitals implanted ICDs during the periods prohibited by the NCD.
“The settlements announced today demonstrate the Department of Justice’s commitment to protect Medicare dollars and federal health benefits,” said U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida. “Guided by a panel of leading cardiologists and the review of thousands of patients’ charts, the extensive investigation behind the settlements was heavily influenced by evidence-based medicine. In terms of the number of defendants, this is one of the largest whistleblower lawsuits in the United States and represents one of this office’s most significant recoveries to date. Our office will continue to vigilantly protect the Medicare program from potential false billing claims.”
“Working as a team with the Department of Justice to investigate and settle false billing claims of this magnitude has resulted in substantial recoveries to Medicare and the successful enforcement of Medicare’s coverage requirements for these procedures,” said Inspector General Daniel Levinson of the Department of Health and Human Services’ Office of Inspector General (HHS-OIG).
The 70 settlements, representing nearly 500 hospitals, are listed on the attached chart. Most of the settling defendants were named in a qui tam, or whistleblower, lawsuit brought under the False Claims Act, which permits private citizens to bring lawsuits on behalf of the United States and receive a portion of the proceeds of any settlement or judgment awarded against a defendant. The lawsuit was filed in federal district court in the Southern District of Florida by Leatrice Ford Richards, a cardiac nurse, and Thomas Schuhmann, a health care reimbursement consultant. The whistleblowers have received more than $38 million from the settlements. The Department of Justice is continuing to investigate additional hospitals and health systems.
The settlements were the result of a coordinated effort among the U.S. Attorney’s Office of the Southern District of Florida, the Civil Division’s Commercial Litigation Branch and HHS-OIG, Office of Investigations and Office of Counsel to the Inspector General.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $26.2 billion through False Claims Act cases, with more than $16.4 billion of that amount recovered in cases involving fraud against federal health care programs.
The claims resolved by these settlements are allegations only and there has been no determination of liability.
Nearly 500 Hospitals Pay United States More Than $250 Million to Resolve False Claims Act Allegations Related to Implantation of Cardiac DevicesRead the Press Release
The Department of Justice has reached 70 settlements involving 457 hospitals in 43 states for more than $250 million related to cardiac devices that were implanted in Medicare patients in violation of Medicare coverage requirements, the Department of Justice announced today.
“The settlements announced today demonstrate the Department of Justice’s commitment to protect Medicare dollars and federal health benefits,” said U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida. “Guided by a panel of leading cardiologists and the review of thousands of patients’ charts, the extensive investigation behind the settlements was heavily influenced by evidence-based medicine. In terms of the number of defendants, this is one of the largest whistleblower lawsuits in the United States and represents one of this office’s most significant recoveries to date. Our office will continue to vigilantly protect the Medicare program from potential false billing claims.”
“While recognizing and respecting physician judgment, the department will hold accountable hospitals and health systems for procedures performed by physicians at their facilities that fail to comply with Medicare billing rules,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “We are confident that the settlements announced today will lead to increased compliance and result in significant savings to the Medicare program while protecting patient health.”
An implantable cardioverter defibrillator, or ICD, is an electronic device that is implanted near and connected to the heart. It detects and treats chaotic, extremely fast, life-threatening heart rhythms, called fibrillations, by delivering a shock to the heart, restoring the heart’s normal rhythm. It is similar in function to an external defibrillator (often found in offices and other buildings) except that it is small enough to be implanted in a patient’s chest. Only patients with certain clinical characteristics and risk factors qualify for an ICD covered by Medicare.
Medicare coverage for the device, which costs approximately $25,000, is governed by a National Coverage Determination (NCD). The Centers for Medicare and Medicaid Services implemented the NCD based on clinical trials and the guidance and testimony of cardiologists and other health care providers, professional cardiology societies, cardiac device manufacturers and patient advocates. The NCD provides that ICDs generally should not be implanted in patients who have recently suffered a heart attack or recently had heart bypass surgery or angioplasty. The medical purpose of a waiting period -40 days for a heart attack and 90 days for bypass/angioplasty - is to give the heart an opportunity to improve function on its own to the point that an ICD may not be necessary. The NCD expressly prohibits implantation of ICDs during these waiting periods, with certain exceptions. The Department of Justice alleged that from 2003 to 2010, each of the settling hospitals implanted ICDs during the periods prohibited by the NCD.
“Working as a team with the Department of Justice to investigate and settle false billing claims of this magnitude has resulted in substantial recoveries to Medicare and the successful enforcement of Medicare’s coverage requirements for these procedures,” said Inspector General Daniel Levinson of the Department of Health and Human Services’ Office of Inspector General (HHS-OIG).
The 70 settlements, representing nearly 500 hospitals, are listed on the attached chart. Most of the settling defendants were named in a qui tam, or whistleblower, lawsuit brought under the False Claims Act, which permits private citizens to bring lawsuits on behalf of the United States and receive a portion of the proceeds of any settlement or judgment awarded against a defendant. The lawsuit was filed in federal district court in the Southern District of Florida by Leatrice Ford Richards, a cardiac nurse, and Thomas Schuhmann, a health care reimbursement consultant. The whistleblowers have received more than $38 million from the settlements. The Department of Justice is continuing to investigate additional hospitals and health systems.
The settlements were the result of a coordinated effort among the U.S. Attorney’s Office of the Southern District of Florida, the Civil Division’s Commercial Litigation Branch and HHS-OIG, Office of Investigations and Office of Counsel to the Inspector General.
This case was prosecuted by Jeffrey W. Dickstein of the United States Attorney's Office in Miami and Amy L. Easton of the Department of Justice in Washington, DC.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $26.2 billion through False Claims Act cases, with more than $16.4 billion of that amount recovered in cases involving fraud against federal health care programs.
The claims resolved by these settlements are allegations only and there has been no determination of liability.
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.
Attachment (66.31 KB)
Nearly 500 Hospitals Pay United States More Than $250 Million to Resolve False Claims Act Allegations Related to Implantation of Cardiac DevicesRead the Press Release
WASHINGTON – The Department of Justice has reached 70 settlements involving 457 hospitals in 43 states for more than $250 million related to cardiac devices that were implanted in Medicare patients in violation of Medicare coverage requirements, the Department of Justice announced today.
“While recognizing and respecting physician judgment, the department will hold accountable hospitals and health systems for procedures performed by physicians at their facilities that fail to comply with Medicare billing rules,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “We are confident that the settlements announced today will lead to increased compliance and result in significant savings to the Medicare program while protecting patient health.”
An implantable cardioverter defibrillator, or ICD, is an electronic device that is implanted near and connected to the heart. It detects and treats chaotic, extremely fast, life-threatening heart rhythms, called fibrillations, by delivering a shock to the heart, restoring the heart’s normal rhythm. It is similar in function to an external defibrillator (often found in offices and other buildings) except that it is small enough to be implanted in a patient’s chest. Only patients with certain clinical characteristics and risk factors qualify for an ICD covered by Medicare.
Medicare coverage for the device, which costs approximately $25,000, is governed by a National Coverage Determination (NCD). The Centers for Medicare and Medicaid Services implemented the NCD based on clinical trials and the guidance and testimony of cardiologists and other health care providers, professional cardiology societies, cardiac device manufacturers and patient advocates. The NCD provides that ICDs generally should not be implanted in patients who have recently suffered a heart attack or recently had heart bypass surgery or angioplasty. The medical purpose of a waiting period -40 days for a heart attack and 90 days for bypass/angioplasty - is to give the heart an opportunity to improve function on its own to the point that an ICD may not be necessary. The NCD expressly prohibits implantation of ICDs during these waiting periods, with certain exceptions. The Department of Justice alleged that from 2003 to 2010, each of the settling hospitals implanted ICDs during the periods prohibited by the NCD.
“The settlements announced today demonstrate the Department of Justice’s commitment to protect Medicare dollars and federal health benefits,” said U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida. “Guided by a panel of leading cardiologists and the review of thousands of patients’ charts, the extensive investigation behind the settlements was heavily influenced by evidence-based medicine. In terms of the number of defendants, this is one of the largest whistleblower lawsuits in the United States and represents one of this office’s most significant recoveries to date. Our office will continue to vigilantly protect the Medicare program from potential false billing claims.”
“Working as a team with the Department of Justice to investigate and settle false billing claims of this magnitude has resulted in substantial recoveries to Medicare and the successful enforcement of Medicare’s coverage requirements for these procedures,” said Inspector General Daniel Levinson of the Department of Health and Human Services’ Office of Inspector General (HHS-OIG).
The 70 settlements, representing nearly 500 hospitals, are listed on the attached chart. Most of the settling defendants were named in a qui tam, or whistleblower, lawsuit brought under the False Claims Act, which permits private citizens to bring lawsuits on behalf of the United States and receive a portion of the proceeds of any settlement or judgment awarded against a defendant. The lawsuit was filed in federal district court in the Southern District of Florida by Leatrice Ford Richards, a cardiac nurse, and Thomas Schuhmann, a health care reimbursement consultant. The whistleblowers have received more than $38 million from the settlements. The Department of Justice is continuing to investigate additional hospitals and health systems.
The settlements were the result of a coordinated effort among the U.S. Attorney’s Office of the Southern District of Florida, the Civil Division’s Commercial Litigation Branch and HHS-OIG, Office of Investigations and Office of Counsel to the Inspector General.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $26.2 billion through False Claims Act cases, with more than $16.4 billion of that amount recovered in cases involving fraud against federal health care programs.
The claims resolved by these settlements are allegations only and there has been no determination of liability.
Mt. Hope man pleads guilty to Federal drug chargeRead the Press Release
BECKLEY, W.Va. – United States Attorney Booth Goodwin announced that Ron Perdue, 54, of Mt. Hope, West Virginia, plead guilty today in federal court in Beckley to distributing oxycodone. Perdue admitted that on October 22, 2014, he sold oxycodone to a person who was cooperating with law enforcement authorities. The drug deal took place on Ewart Avenue in Beckley, West Virginia.
Perdue faces up to 20 years in prison and a $1,000,000 fine. United States Magistrate Judge R. Clarke VanDervort scheduled the sentencing for February 11, 2016.
The Beckley/Raleigh County Drug and Violent Crime Unit conducted the investigation.
This case was prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and opiates. The United States Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
- Follow us on Twitter: SDWVNews
Milford Man Pleads Guilty to Possessing Child PornographyRead the Press Release
Contact: Jody Mullis
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Anthony Parent, 22, of Milford, Maine, pled guilty today in U.S. District Court to possessing child pornography.
According to court records, from about October 31, 2013 to about July 17, 2014, Parent kept images and videos of child pornography on his personal computer, uploaded them to online accounts, and used electronic mail services to trade child pornography with others.
He faces up to 20 years in prison, a $250,000 fine and between five years and a lifetime of supervised release. He will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
The investigation was conducted by the Federal Bureau of Investigation.
Metairie Man Pleads Guilty to Trafficking in over $150,000 in Counterfeit GoodsRead the Press Release
U.S. Attorney Kenneth A. Polite announced that BOUBACAR DIALLO, age 35, of Metairie, pled guilty today to a one-count Bill of Information charging him with trafficking in counterfeit goods.
According to court documents, on March 12, 2015, investigators with the Office of the Attorney General Investigation Division and agents with the United States Department of Homeland Security – Homeland Security Investigations, acting on information that DIALLO was involved in the purchase and subsequent sale of large quantities of counterfeit merchandise, met DIALLO at his residence in Metairie. Law enforcement officials observed numerous cardboard boxes full of counterfeit merchandise. They subsequently verified as counterfeit 111 pairs of “True Religion” blue jeans; 166 “Michael Kors” purses; 67 “Michael Kors” pocketbooks; 87 “Michael Kors” watches; 6 pair of “Nike” tennis shoes; 9 pair of “Polo” pants; 8 pair of “Polo” shirts; and 693 counterfeit Michael Kors labels. The collective fair market value of all the counterfeit items and was approximately $158,049. DIALLO admitted that he knew the items he was selling were counterfeit and that he had purchased them from individuals in Atlanta and New York City. DIALLO also admitted to renting storage units to hide and store the counterfeit merchandise.
DIALLO faces a maximum term of imprisonment of not more than ten years, followed by up to three years of supervised release, and a $250,000 fine. U.S. District Judge Lance M. Africk set sentencing for February 4, 2016.
U.S. Attorney praised the work of the Louisiana Department of Justice / Office of the Attorney General Investigation Division and Immigration and Customs Enforcement, Homeland Security Investigations for investigating this matter. Assistant United States Attorney Jordan Ginsberg is in charge of the prosecution.
Men Involved in Fraud Scheme are SentencedRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that two men were sentenced today by U.S. District Judge Stefan R. Underhill in Bridgeport for engaging in a fraud scheme. ADAM MEYERS, 44, of Southbury, was sentenced to 18 months of imprisonment, followed by three years of supervised release, and DANIEL WALL, 59, of Bridgeport, was sentenced to three years of probation, the first 12 months of which he must serve in home confinement.
According to court documents and statements made in court, between approximately March 2008 and August 2012, MEYERS and Jason Torrance devised a scheme to defraud their employers by arranging for payment on goods that never shipped and instead diverting those payments to themselves. Torrance worked out of the New Haven branch of a New Jersey-based electrical and industrial supply company (“Distributor-1”), and MEYERS was a project manager for a New Britain-based electrical subcontractor (“Contractor”) that frequently purchased supplies from Distributor-1. WALL operated Bob Wall and Associates, a Cheshire-based distributor of electrical and other related equipment.
As part of the scheme, MEYERS identified to Torrance projects on which he believed the profit margin for Contractor would permit them to divert excess profits to themselves without Contractor becoming aware. MEYERS would submit a purchase order for materials to Torrance. Torrance then submitted a purchase order to WALL for the goods listed on the purchase order sent by MEYERS. WALL then submitted an invoice to Distributor-1 for the materials listed on the purchase order, and Distributor-1 paid the invoice by mailing a check to Bob Wall and Associates. Distributor-1 then invoiced Contractor for the goods that were on the purchase order and Contractor issued a check to Distributor-1. WALL then hand-delivered a business check to Torrance for approximately 90 percent of the money that had been paid by Distributor-1 to Bob Wall and Associates, and WALL retained the remaining 10 percent as his share of the proceeds from the scheme. Torrance then paid out a portion of the proceeds of the scheme to MEYERS.
At no time did any product on the purchase orders actually ship to the customer.
The victim companies lost more than $600,000 as a result of this scheme. Restitution will be determined after additional court proceedings.
On February 23, 2015, MEYERS and Torrance each pleaded guilty to one count of conspiracy to commit mail fraud. On July 15, 2015, WALL pleaded guilty to one count of misprision of a felony. Torrance awaits sentencing.
This matter has been investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant U.S. Attorneys David E. Novick and William J. Nardini.
Manchester Man Sentenced to Prison for Distributing HeroinRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that JOSE COLON, also known as “Uncle Benny,” 50, of Manchester, was sentenced today by U.S. District Judge Michael P. Shea in Hartford to 24 months of imprisonment, followed by three years of supervised release, for distributing heroin.
According to court documents and statements made in court, this matter stems from a joint law enforcement investigation headed by the Federal Bureau of Investigation’s Northern Connecticut Violent Crimes Task Force and the Hartford Police Department into gang-related narcotics trafficking in Hartford’s South End. The investigation specifically targeted a drug trafficking organization headed by Angel Rosa, aka “Little” and “Daddy,” who is a member of the Los Solidos street gang. Rosa’s cousin, Angel Rosa, aka “Mo Betta” and “Fab,” supervised the daily operations of the organization, which distributed heroin and other narcotics in the Zion Street area.
In April 2013, COLON was intercepted over a court-authorized wiretap and was identified as a source of heroin for the Rosa organization.
As a result of the investigation, 21 individuals were charged with various federal offenses, and law enforcement officers seized narcotics, one firearm, approximately $230,000 in cash, eight vehicles and jewelry.
COLON was arrested on April 25, 2013. On that date, FBI Task Force officers and Manchester Police executed a search warrant at his residence and seized a number of items that subsequently were forfeited, including $7,800 in cash, a watch valued at $46,850, two vehicles, two jet skis and two motorcycles.
On April 4, 2014, COLON pleaded guilty to one count of conspiracy to possess with intent to distribute, and to distribute, heroin.
Angel Rosa aka “Little” and Angel Rosa aka “Mo Betta” each pleaded guilty to one count of conspiracy to possess with intent to distribute, and to distribute, 100 grams or more of heroin. On May 15, 2014, “Little” was sentenced to 235 months of imprisonment and, on April 29, 2014, “Mo Betta” was sentenced to 165 months of imprisonment.
This matter was investigated by the Federal Bureau of Investigation’s Northern Connecticut Violent Crimes Task Force, which includes members of the Connecticut State Police, Hartford Police Department, East Hartford Police Department, Connecticut Department of Correction and Connecticut National Guard. The Connecticut State Police’s Emergency Services Unit, Hartford Police Department’s Emergency Response Team, Capital Region Emergency Response Team, Drug Enforcement Administration, Homeland Security Investigations and the New Britain, East Hartford, Wethersfield and Manchester Police Departments have provided valuable assistance to the investigation.
The case is being prosecuted by Assistant U.S. Attorneys Brian Leaming and Patrick Caruso.
Long Island Registered Sex Offender Pleads Guilty to Downloading Child PornographyRead the Press Release
Earlier today, William D. Gulick, Jr., a registered sex offender from Commack, Long Island, pled guilty at the federal courthouse in Central Islip, New York, to receiving child pornography in interstate commerce. The proceeding took place before United States Magistrate Judge Steven I. Locke. At sentencing, Gulick faces a mandatory minimum sentence of 15 years in prison and a maximum of 40 years in prison.
The guilty plea was announced by Robert L. Capers, United States Attorney for the Eastern District of New York.
“Registered Sex Offenders such as the defendant are on notice that we are committed to protecting children and will vigorously prosecute those who victimize them,” stated United States Attorney Capers. “The penalties for repeated child exploitation offenses under federal law are deservedly severe.” Mr. Capers thanked the U.S. Immigrations Customs Enforcement’s (ICE), Homeland Security Investigations (HSI) and the Suffolk County Police Department (SCPD) for their assistance in the investigation.
As detailed in the indictment and court filings, in the fall of 2014, HSI agents, as part of an ongoing effort to locate individuals sharing child pornography, traced child pornography observed via peer-to-peer online trading software back to the defendant’s Commack residence. The images and videos he downloaded involved the rape of children as young as toddlers. During execution of a search warrant on the residence, SCPD Emergency Services officers were forced to use a Taser device to disarm and apprehend the defendant.
Gulick, Jr. is a registered sex offender based upon a prior child abuse conviction in Suffolk County in 1998 for Sexual Abuse in the 1st Degree and a 2013 conviction for Possessing a Sexual Performance of a Child under 16. At the time of his arrest in this case, the defendant was on probation for the 2013 conviction and had recently been released from custody.
The government’s case is being handled by the Office’s Long Island Criminal Division. Assistant United States Attorney Allen Bode is in charge of the prosecution.
The Defendant:
William D. Gulick, Jr.
Age: 36
Commack, New YorkE.D.N.Y. Docket No. 14 CR 608 (ADS)
Local officials prepared to transition inmates back into Northern West Virginia communitiesRead the Press Release
WHEELING, WEST VIRGINIA – Beginning November 2, 44 federal inmates will return to the Northern District of West Virginia pursuant to the United States Sentencing Commission’s decision to modify the sentencing guidelines for certain federal drug offenses, United States Attorney William J. Ihlenfeld, II, and Chief U.S. Probation Officer Terry L. Huffman announced.
In 2014, after receiving nearly 80,000 public comments and holding two public hearings, the United States Sentencing Commission voted unanimously to modify the sentences of certain federal drug offenders. Congress then considered the Sentencing Commission’s recommendation and did not vote to disapprove the sentencing change. The change became effective November 1, 2014. The Commission allotted one calendar year for courts and the Bureau of Prisons to prepare for the releases.
“Some current Bureau of Prisons inmates are scheduled for an early release beginning November 2. As we always do, we have notified area law enforcement agencies about the release of these individuals. We have also entered their names into a national database to ensure that law enforcement everywhere will know that these individuals are under supervised release,” noted Huffman. “While the number of inmates returning nationwide is large, here in the Northern District of West Virginia the number of releases is very manageable. This has been an issue where we have had adequate notice. We have had over a year to prepare for these inmates being released, and we are prepared to monitor them once they are released.”
Approximately 68% of inmates returning to Northern West Virginia have already been placed under supervision in halfway houses (43%) or home confinement (25%). Approximately 26% of inmates returning to Northern West Virginia will be released from prison. Additional inmates currently incarcerated within the Northern District of West Virginia may be released to other districts or to U.S. Immigration and Customs Enforcement for potential deportation. The Bureau of Prisons and United States Probation and Pretrial Services have collaborated to ensure that all released inmates receive proper supervision and reentry services.
“The Bureau of Prisons has extensive experience in successfully transitioning inmates back into society,” noted Ihlenfeld. “We are confident the upcoming release will have a minimal impact upon the communities in Northern West Virginia. We are not anticipating a large influx of prisoners released into our district and those inmates that are released will be closely supervised as they transition back into our neighborhoods. ”
The sentencing reductions are not automatic. Federal judges must carefully consider public safety and have the discretion to approve or deny the reduction of a particular inmate’s sentence. As of July 2015, judges had denied approximately 25% of petitions received across the country. Many of the federal drug offenders will serve substantial prison sentences before they are eligible for release.
The United States Sentencing Commission is an independent agency in the judicial branch composed of seven voting and two non-voting members. Its principal purpose is to establish sentencing policies and practices for the federal criminal justice system that will assure the ends of justice by promulgating detailed guidelines prescribing the appropriate sentences for offenders convicted of federal crimes.
Local Law Enforcement Officers Honored for Commitment to Drug Abuse PreventionRead the Press Release
CEDAR RAPIDS - Three local police officers were honored today by the United States Attorney’s Office for the Northern District of Iowa and the Drug Enforcement Administration (DEA) for their commitment to reducing drug abuse in their communities. The recipients of the 2015 Enrique S. Camarena Award are Detective Jerry Blomgren and Officer David Schwindt of the Iowa City Police Department, and Sergeant David Dostal of the Cedar Rapids Police Department.
The award is named after Enrique “Kiki” Camarena, who was an 11 year veteran agent of the DEA before being kidnapped, brutally tortured and then murdered in Mexico in 1985 while working undercover gathering information and evidence about drug lords. This award is presented each year to local law enforcement officers who best exemplify the qualities and principles for which Agent Camarena gave his life—specifically, making their communities a safer place to live through outstanding drug prevention and enforcement efforts.
Kevin W. Techau, United States Attorney for the Northern District of Iowa commented on this year’s award recipients, stating, “The communities these officers serve are safer because of their hard work and dedication. They richly deserve the honor of being this year’s award recipients.”
This year’s award recipients have gone above and beyond the call of duty in pursuit of a drug-free community:
- Recognizing the harm that synthetic drugs were having on the Iowa City area, Detective Jerry Blomgren and Officer David Schwindt worked with several law enforcement entities and utilized a variety of investigative techniques to remove over 100 pounds of synthetic drugs from the street. They also participated in numerous community meetings providing education regarding the hazards of synthetic drugs.Through their efforts, synthetic drugs are now virtually non-existent in the Iowa City area.
- As the supervisor of the Narcotics Division with the Cedar Rapids Police Department, Sgt. David Dostal has taken a leadership role in tackling the heroin problem that has plagued the Cedar Rapids community. In addition to presenting at schools, community groups, and youth academies regarding the dangers of heroin and other illicit drugs, Sgt. Dostal took the lead in a high-profile heroin case that resulted in two federal indictments and which seriously disrupted the heroin drug trade in the Cedar Rapids area.
Michael J. Sanders, the Assistant Special Agent in Charge for the DEA commented on this year’s award, stating “It is an honor to be a part of such a well-deserved, distinguished award, presented in memory of fallen DEA Special Agent Enrique S. Camarena, who spent his career fighting against the powerful drug cartels in Mexico. This eminent award exemplifies the outstanding investigative efforts of these three dedicated law enforcement officers in disrupting the illegal activities of these drug trafficking organizations and preventing the further distribution of these highly addictive, deadly drugs, in and around the Iowa City and Cedar Rapids communities.”
The Enrique S. Camarena Award is presented each year during Red Ribbon Week. Red Ribbon Week is an alcohol, tobacco, and drug prevention awareness campaign observed annually in the United States. This year, Red Ribbon Week runs from October 23 through October 31.
Follow us on Twitter @USAO_NDIA.
Lincoln county nurse sentenced in Federal court for obtaining drugs by fraudRead the Press Release
CHARLESTON, W.Va. – United States Attorney Booth Goodwin announced that Betty Jo Tudor, 35, of Alkol, West Virginia, was sentenced today in federal court in Charleston to five years of probation for obtaining hydrocodone by fraud. Tudor, a former nurse at Sweetbriar Assisted Living in Dunbar, West Virginia, previously pled guilty and admitted that in June of 2013 she stole hydrocodone intended for patients for her own personal use and falsified records to cover up the theft.
The case was investigated by the Drug Enforcement Administration and the United States Department of Health and Human Services. Assistant United States Attorney Jennifer Rada Herrald handled the prosecution.
This case is being prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and heroin. The United States Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
- Follow us on Twitter: SDWVNews
Large Scale Miami Drug Supplier Pleads Guilty in Nationwide Prescription Drug Diversion SchemeRead the Press Release
The Department of Justice announced that a South Florida man pleaded guilty in U.S. District Court in Cincinnati, Ohio, in connection with the prosecution of a nationwide prescription drug diversion scheme.
Ricardo Alfredo Jurado, 59, of Miami Beach, pleaded guilty before U.S. District Court Judge Timothy S. Black to one count of conspiracy to commit mail and wire fraud.
Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division; U.S. Attorney Carter M. Stewart of the Southern District of Ohio; Special Agent in Charge Antoinette V. Henry of the U.S. Food and Drug Administration’s Office of Criminal Investigations (FDA-OCI), Metro Washington Field Office and Assistant Inspector in Charge Christopher White of the U.S. Postal Inspection Service (USPIS), Cincinnati Field Office, announced the guilty plea.
“Prescription drug diversion compromises the integrity of America’s drug supply chain,” said Principal Deputy Assistant Attorney General Mizer. “This Miami-based supplier sold tens of millions of dollars of illegally diverted drugs, which ended up on the shelves of pharmacies and in the medicine cabinets of American consumers.”
“The drug diversion activities charged in this case create unacceptable public health risks,” said U.S. Attorney Stewart. “Patients purchased what they believed were FDA-approved prescription drugs that had remained in regulated distribution channels intended to protect against misbranded, adulterated, sub-potent, improperly handled, counterfeit and stolen products. Instead, these customers received drugs of unknown quality and origin.”
Jurado sold illegally diverted prescription drugs to David Miller and his company, Minnesota Independent Cooperative (MIC). On May 6, Miller and MIC, along with Artur Stepanyan and Mihran Stepanyan, were indicted in the Southern District of Ohio and charged with one count of conspiracy to commit mail and wire fraud, ten counts of mail fraud and one count of conspiracy to make false statements and to distribute prescription drugs without a wholesale license. Those charges are still pending. Jurado is the eighth co-conspirator who pleaded guilty for participating in the drug diversion scheme involving Miller and MIC.
Miller and MIC sold the prescription drugs obtained through Jurado – along with multiple other illegal sources – to wholesale and retail customers throughout the United States, including in the Southern District of Ohio. Miller and MIC are alleged to have created fraudulent pedigree documents falsely stating that they had purchased the drugs from B&Y Wholesale, a company in Puerto Rico. These false pedigrees covered up the illegitimate sources of the drugs – various illicit suppliers, including Jurado – and falsely stated that B&Y was an authorized distributor of the prescription drugs.
According to court documents, from July 2007 through April 2014, Jurado facilitated the sale of tens of millions of dollars of illegally diverted prescription drugs to Miller and MIC. Jurado obtained the drugs from other illicit, unlicensed sources in South Florida. To hide Jurado’s involvement in the sale of these drugs, Jurado and Miller used a middleman, Fernando Galan. On Oct. 14, Galan pleaded guilty for his role in the conspiracy. Neither Jurado nor Galan was licensed to engage in the wholesale distribution of prescription drugs.
In connection with the sale of the diverted drugs, Jurado sent bank wiring instructions, frequently through his middleman Galan, directing Miller to send payments for the drugs. During the course of the entire conspiracy, Jurado and his co-conspirators directed payments to more than 25 different bank accounts at banks in Mexico, Nicaragua, Canada, Florida and other locations. During the course of the conspiracy, Miller and MIC wired more than $40 million to the bank accounts specified by Jurado.
This matter is being investigated by FDA-OCI and the USPIS. Assistant U.S. Attorneys Anne L. Porter and Christy Muncy of Southern District of Ohio and Trial Attorney John W. Burke of the Civil Division’s Consumer Protection Branch are representing the United States in this case.
Large Scale Miami Drug Supplier Pleads Guilty in Nationwide Prescription Drug Diversion SchemeRead the Press Release
WASHINGTON – The Department of Justice announced that a South Florida man pleaded guilty in U.S. District Court in Cincinnati, Ohio, in connection with the prosecution of a nationwide prescription drug diversion scheme.
Ricardo Alfredo Jurado, 59, of Miami Beach, pleaded guilty before U.S. District Court Judge Timothy S. Black to one count of conspiracy to commit mail and wire fraud.
Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division; U.S. Attorney Carter M. Stewart of the Southern District of Ohio; Special Agent in Charge Antoinette V. Henry of the U.S. Food and Drug Administration’s Office of Criminal Investigations (FDA-OCI), Metro Washington Field Office and Assistant Inspector in Charge Christopher White of the U.S. Postal Inspection Service (USPIS), Cincinnati Field Office, announced the guilty plea.
“Prescription drug diversion compromises the integrity of America’s drug supply chain,” said Principal Deputy Assistant Attorney General Mizer. “This Miami-based supplier sold tens of millions of dollars of illegally diverted drugs, which ended up on the shelves of pharmacies and in the medicine cabinets of American consumers.”
“The drug diversion activities charged in this case create unacceptable public health risks,” said U.S. Attorney Stewart. “Patients purchased what they believed were FDA-approved prescription drugs that had remained in regulated distribution channels intended to protect against misbranded, adulterated, sub-potent, improperly handled, counterfeit and stolen products. Instead, these customers received drugs of unknown quality and origin.”
Jurado sold illegally diverted prescription drugs to David Miller and his company, Minnesota Independent Cooperative (MIC). On May 6, Miller and MIC, along with Artur Stepanyan and Mihran Stepanyan, were indicted in the Southern District of Ohio and charged with one count of conspiracy to commit mail and wire fraud, ten counts of mail fraud and one count of conspiracy to make false statements and to distribute prescription drugs without a wholesale license. Those charges are still pending. Jurado is the eighth co-conspirator who pleaded guilty for participating in the drug diversion scheme involving Miller and MIC.
Miller and MIC sold the prescription drugs obtained through Jurado – along with multiple other illegal sources – to wholesale and retail customers throughout the United States, including in the Southern District of Ohio. Miller and MIC are alleged to have created fraudulent pedigree documents falsely stating that they had purchased the drugs from B&Y Wholesale, a company in Puerto Rico. These false pedigrees covered up the illegitimate sources of the drugs – various illicit suppliers, including Jurado – and falsely stated that B&Y was an authorized distributor of the prescription drugs.
According to court documents, from July 2007 through April 2014, Jurado facilitated the sale of tens of millions of dollars of illegally diverted prescription drugs to Miller and MIC. Jurado obtained the drugs from other illicit, unlicensed sources in South Florida. To hide Jurado’s involvement in the sale of these drugs, Jurado and Miller used a middleman, Fernando Galan. On Oct. 14, Galan pleaded guilty for his role in the conspiracy. Neither Jurado nor Galan was licensed to engage in the wholesale distribution of prescription drugs.
In connection with the sale of the diverted drugs, Jurado sent bank wiring instructions, frequently through his middleman Galan, directing Miller to send payments for the drugs. During the course of the entire conspiracy, Jurado and his co-conspirators directed payments to more than 25 different bank accounts at banks in Mexico, Nicaragua, Canada, Florida and other locations. During the course of the conspiracy, Miller and MIC wired more than $40 million to the bank accounts specified by Jurado.
This matter is being investigated by FDA-OCI and the USPIS. Assistant U.S. Attorneys Anne L. Porter and Christy Muncy of Southern District of Ohio and Trial Attorney John W. Burke of the Civil Division’s Consumer Protection Branch are representing the United States in this case.
Justice Department Settles with Housing Authority of Baltimore City for Failure to Provide Accessible Housing to Persons with DisabilitiesRead the Press Release
The Justice Department announced today that a federal district court has approved a supplemental consent decree between the United States, the Maryland Disability Law Center and the Housing Authority of Baltimore City (HABC). The original consent decree contained remedies for HABC’s failure to provide accessible housing to persons with disabilities. The supplemental consent decree, which was approved today by U.S. District Judge J. Frederick Motz of the District of Maryland, continues and amends certain terms in the original consent order in United States v. HABC, and Bailey v. HABC, entered on Dec. 20, 2004.
“We are pleased with the significant progress made by the Housing Authority of Baltimore City to implement the terms of the original decree,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division. “We look forward to working with the Housing Authority to create new accessible housing opportunities for persons with disabilities and enhancing their quality of life.”
The original consent decree mandates that HABC create 756 units to comply with federal accessibility standards. As of Aug. 31, 2015, HABC had developed all but 54 of such units. Under the supplemental decree, these remaining units will be completed by Dec. 31, 2016. HABC’s plan requires two and three bedroom single family homes that are fully accessible to families with a household member who has physical disabilities.
The original consent decree also mandates that HABC create 500 units for non-elderly persons with disabilities. As of Aug. 31, 2015, HABC had created 411 such units. Under the supplemental decree, the remaining units will be completed by Dec. 31, 2016. Further, the original consent decree mandates that HABC create 100 new housing opportunities for non-elderly persons with disabilities called “Long Term Affordable” units. HABC has until Dec. 31, 2017, to develop the remaining balance of these units from certain specified developments.
HABC is participating in the Rental Assistance Demonstration Program. Under this program, HABC will be transferring certain public housing properties to private ownership. Under the supplemental decree, the new owners are required to preserve the accessibility of the units and implement the policies and practices that protect the rights of tenants with disabilities.
The Fair Housing Act prohibits discrimination in housing on the basis of race, color, religion, sex, familial status, national origin and disability. More information about the Civil Rights Division and the laws it enforces is available at www.usdoj.gov/crt. Individuals who believe that they have been victims of housing discrimination can call the division’s Housing Discrimination Tip Line at 1-800-896-7743, e-mail the Justice Department at [email protected] or contact HUD at 1-800-669-9777.
HABC Supplemental Consent Decree
Jury Convicts Springfield Sex Offender for Production of Child PornographyRead the Press Release
Springfield, Ill. — A jury deliberated for approximately three and one-half hours this afternoon before returning verdicts of guilty against Marcus B. Fifer, 44, for production of child pornography. Fifer, of Springfield, was convicted on 17 counts of sexual exploitation of a minor to produce child pornography and one count of committing a felony offense with a minor while being required to register as a sex offender. The jury returned not guilty verdicts on six counts of sexual exploitation of a minor. U.S. District Judge Sue E. Myerscough presided over the trial which began on Tuesday, Oct. 27. Judge Myerscough scheduled sentencing for Fifer on Feb. 29, 2016.
At sentencing, Fifer faces mandatory life in prison for each count of sexual exploitation of a minor in the production of child pornography. Fifer was remanded to the custody of the U.S. Marshals Service. Fifer has remained detained in the Marshals’ custody since his arrest in February 2014.
At trial, the government presented evidence that from April 1, 2013 through Nov. 18, 2013, Fifer used a cell phone, tablet and laptop computer to take images of a minor. Further evidence from the government established that Fifer previously pled guilty in 2008, in Champaign County, Ill., to aggravated criminal sexual abuse, and at the time of the offenses for which Fifer was convicted today, he was required to register as a sex offender.
The charges are the result of an investigation by U.S. Immigration and Customs Enforcement Homeland Security Investigations in cooperation with the Springfield Police Department. Assistant U.S. Attorneys John E. Childress and Matthew Z. Weir are prosecuting the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Jury Convicts Orlando Women of Conspiring to Pass and Possess Counterfeit CurrencyRead the Press Release
Orlando, Florida – United States Attorney A. Lee Bentley, III announces that a federal jury has found Sandra Milena Nieves (41) and Eileen Santos (50), both of Orlando, guilty of conspiring to pass and possess counterfeit currency. The jury also convicted Nieves on substantive counts of passing and possessing counterfeit currency and Santos on a substantive count of possessing counterfeit currency. Nieves and Santos each face a maximum penalty of 45 and 25 years in federal prison, respectively. They were indicted on June 2, 2015. Their sentencing hearing is scheduled for January 21, 2016.
According to testimony and evidence presented at trial, between December 2011 and January 2012, Nieves, Santos, along with co-conspirators Jorge Ortiz-Pulgarin, Ramon Rodriguez, Carlos Fuentes, and others, traveled from central Florida up the east coast of the United States with approximately $40,000 in counterfeit currency. The group stopped at more than 30 locations to make small purchases. They used counterfeit $100 bills and received genuine U.S. currency as change. During the road trip, in December 2011, conspirators attempted to pass a counterfeit bill at a mall in Melbourne, Florida. The serial number on the bill matched the number of other counterfeit bills that were subsequently seized from co-conspirators.
In January 2012, Jorge Ortiz-Pulgarin was arrested with $6,500 in counterfeit currency. Shortly thereafter, another member of the conspiracy, Fabian Ortiz, was arrested with more than $200,000 in counterfeit currency. Ortiz-Pulgarin and Ortiz were each federally charged, convicted, and sentenced for their roles in the conspiracy. Ramon Rodriguez and Carlos Fuentes have pleaded guilty for their roles in this conspiracy and are scheduled to be sentenced on November 5, 2015.
This case was investigated by the United States Secret Service. It is being prosecuted by Assistant United States Attorneys Embry J. Kidd and Shawn P. Napier.
Inland Empire Man Convicted of Threatening to Kill Federal OfficerRead the Press Release
LOS ANGELES – A man who threatened to kill a United States Forest Service Law Enforcement Officer who came to the man’s home to ask about trash dumped in the San Bernardino National Forest has been convicted by a federal jury.
Richard Latka, 56, of Hemet, was convicted yesterday afternoon in United States District Court of threatening a federal officer.
According to the evidence presented at the trial, the Forest Service Officer went to a residence in Hemet in October 2014 to investigate trash that had recently been dumped in the nearby national forest. The officer encountered Latka in the front yard of the residence, and Latka reacted angrily when the officer said he wished to speak to “Mr. Morales” without telling Latka why. Latka then ran toward the officer with clenched fists. Believing that Latka intended to hit him, the officer drew his Taser gun. Latka stopped running but continued screaming at the officer. The officer tried to remove himself from the situation by getting into his car, but Latka continued to scream at the officer and pounded on the window of the marked law enforcement vehicle with his fist. The officer drove away, but Latka followed in his own car, yelling “next time you’re dead.” Witnesses reported that Latka later said that he would “get” the officer and that he was going to kill him.
“Threatening the lives of law enforcement officers will not be tolerated,” said United States Attorney Eileen M. Decker. “The officer in this case took many steps to de-escalate the situation and prevent it from getting worse. If not for the officer’s professionalism and calm, the defendant’s conduct could have become more violent and dangerous.”
United States District Judge Dale S. Fischer, who presided over the trial, set sentencing for January 25, 2016, at which time Latka will face a statutory maximum penalty of 10 years in federal prison, a three-year period of supervised release, and a fine of $250,000.
The case against Latka is the product of an investigation by the United States Forest Service.
Information: Federal Court ArraignmentsRead the Press Release
The United States Attorney’s Office announced that those persons listed below were arraigned before the U.S. Magistrate and the indictments handed down by the Grand Jury unsealed.
Appearing before U.S. Magistrate Anderson in Billings, on October 28, 2015 and entering pleas of Not Guilty were:
- BRETT WADE CLOUSE, a 36-year-old resident of Absarokee, appeared on charges of conspiracy to possess with intent to distribute methamphetamine, possession with intent to distribute methamphetamine, conspiracy to commit money laundering, and possession of a firearm in furtherance of a drug trafficking crime. If convicted of the most serious charges contained in the indictment, CLOUSE faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by the Drug Enforcement Administration and the Federal Bureau of Investigation. PACER Case Reference. 15-127
- MAYNARD PAUL CROOKED ARM, a 51-year-old resident of Crow Agency, appeared on charges of conspiracy to distribute methamphetamine and distribution of methamphetamine. If convicted of the most serious charges contained in the indictment, CROOKED ARM faces 20 years in prison, $1,000,000 in fines and 3 years supervised release. The case was investigated by the Bureau of Indian Affairs. PACER Case Reference. 15-128
- RINDA LEE MORGAN, a 42-year-old resident of Helena, appeared on charges of conspiracy to possess with intent to distribute methamphetamine, and possession with intent to distribute methamphetamine. If convicted of the most serious charge contained in the indictment, MORGAN faces 40 years in prison, $5,000,000 in fines and 4 years supervised release. The case was investigated by the Drug Enforcement Administration and the Federal Bureau of Investigation. PACER Case Reference. 15-127
- JESSE DALE VANHOOK, a 32-year-old resident of Missoula, appeared on charges of felon in possession of a firearm. If convicted of the charge contained in the indictment, VANHOOK faces 10 years in prison, $250,000,000 in fines and 3 years supervised release. The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives. PACER Case Reference. 15-23
Appearing before U.S. Magistrate Johnston in Great Falls, on October 28, 2015 and entering pleas of Not Guilty were:
- SCOTT MITCHELL BUMMER, a 51-year-old resident of Helena, appeared on charges of conspiracy to possess with intent to distribute and to distribute methamphetamine, possession with intent to distribute methamphetamine, and possession of firearms in furtherance of a drug trafficking crime. If convicted of the most serious charges contained in the superseding indictment, BUMMER faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by the Russell Country Drug Task Force. PACER Case Reference. 15-46
- ULYSSES GARCIA, a 26-year-old resident of Salem, Oregon, appeared on charges of possession with intent to distribute methamphetamine. If convicted of the charge contained in the indictment, GARCIA faces 40 years in prison, $5,000,000 in fines and 4 years supervised release. The case was investigated by the Bureau of Indian Affairs. PACER Case Reference. 15-74
- LLOYD THOMAS RIDER, III, a 28year-old resident of Great Falls, appeared on charges of felon in possession of a firearm. If convicted of the charge contained in the indictment, RIDER faces 10 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the Bureau of Indian Affairs. PACER Case Reference. 15-68
- PETER MICHAEL RUSSETTE, a 37-year-old resident of Great Falls, appeared on charges of felon in possession of a firearm and obstruction of justice – witness tampering. If convicted of the most serious charge contained in the indictment, RUSSETTE faces 20 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives. PACER Case Reference. 15-67
Appearing before U.S. Magistrate Johnston in Great Falls, on October 27, 2015 and entering pleas of Not Guilty were:
- KALVIN JOSEPH GOBERT, a 29-year-old resident of Browning, appeared on charges of sexual abuse of a minor. If convicted of the charge contained in the indictment, GOBERT faces 15 years in prison, $250,000 in fines and lifetime supervised release. The case was investigated by the Bureau of Indian Affairs. PACER Case Reference. 15-75
If any of the above cases are of interest to your media organization and the community it serves, we encourage you to monitor the progress of the case regularly through the U.S. District Court calendar and the PACER system so that you stay current and not miss any important developments in the case.
To establish a PACER account, which will allow you to review documents filed in the case, please go to, http://www.pacer.gov/register.html. To access the district court’s calendar, please go to https://ecf.mtd.uscourts.gov/cgi-bin/PublicCalendar.pl.
Honduran National Sentenced for Illegally ReentryRead the Press Release
U.S. Attorney Kenneth A. Polite announced that JUAN VASQUEZ-ALVARADO, age 47, a citizen of Honduras, was sentenced today after previously pleading guilty to a one-count Indictment for illegal reentry of a removed alien.
U.S. District Judge Carl J. Barbier sentenced VASQUEZ-ALVARADO to time served and a $100 special assessment. VASQUEZ-ALVARADO will be surrendered to the custody of the U.S. Immigration & Customs Enforcement for removal proceedings.
According to court documents, VASQUEZ-ALVARADO was found in the United States on July 2, 2015, after having been officially deported and removed on or about September 2, 2002.
U.S. Attorney Polite praised the work of the United States Department of Homeland Security in investigating this matter. Assistant United States Attorney Spiro G. Latsis is in charge of the prosecution.
Honduran National Charged with Illegal ReentryRead the Press Release
U.S. Attorney Kenneth A. Polite announced that JIMY NAHUN NUÑEZ-IZAGUIRRE, age 31, a citizen of Honduras, was charged today in a one-count Bill of Information with illegal reentry of a removed alien.
According to the Bill of Information, NUÑEZ-IZAGUIRRE reentered the United States on or about October 1, 2015, after having been previously removed therefrom on or about July 25, 2008.
If convicted, NUÑEZ-IZAGUIRRE faces a maximum term of imprisonment of two years, a fine of up to $250,000.00, one year supervised release after imprisonment, and a $100 special assessment.
U.S. Attorney Polite reiterated that a Bill of Information is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
U.S. Attorney Polite praised the work of the United States Department of Homeland Security, Immigration and Customs Enforcement in investigating this matter. Assistant United States Attorney Irene González is in charge of the prosecution.
Godfather of Portsmouth Bloods Gang Sentenced to Life in PrisonRead the Press Release
NORFOLK, Va. – Christopher Smith, aka Killa, 32, of Portsmouth, was sentenced today to life in prison for conspiring to manufacture, distribute, and possess with intent to distribute over one kilogram of heroin and for possessing a firearm in furtherance of that conspiracy.
Also sentenced today were co-conspirators Howard Foust (223 months), Dwayne Banks (135 months), and Ricky Jackson (280 months).
Smith, the former “Godfather” of the Portsmouth-based Imperial Gangsta Bloods, a set affiliated with the United Blood Nation, pleaded guilty on July 28, 2015. According to court documents, from early 2014 until September 2014, Smith and others working at his direction traveled to New York City, where they bought bulk quantities of heroin from Imperial Gangsta Bloods member Jackson, aka Sosa. The heroin was transported from New York City back to the Hampton Roads area where it was cut and prepared for street-level distribution by other members of the gang, including high-ranking members Junious Whitaker, aka “Redd,” and Foust, aka “Lil’ Howard” (Case details on Jackson, Whitaker, Foust and Jermarrieo Stigger are in the table presented below).
In August 2014, Smith and other members of the gang were involved a series of violent altercations with twin brothers Jason and Jeremy Saunders, who ran a separate heroin trafficking organization in Portsmouth. On Aug. 18, 2014, a member of the Imperial Gangsta Bloods shot Jeremy Saunders multiple times. Saunders survived the shooting. Days later, Smith, Whitaker and another IGB gang member were involved in a separate shooting incident with the Saunders brothers (both of whom were later convicted in a separate federal drug prosecution). Several weeks after the second August shooting, Smith, Foust and two other individuals were stopped on the Eastern Shore of Virginia on their way back from New York City, where they had purchased approximately 275 grams of heroin.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and John S. Adams, Special Agent in Charge of the FBI’s Norfolk Field Office, made the announcement after sentencing by U.S. District Judge John A. Gibney, Jr. Assistant U.S. Attorneys Andrew Bosse and Joseph DePadilla prosecuted the case.
This case was investigated by the FBI’s Norfolk field office in conjunction with the ATF, the Portsmouth, Virginia Beach, and Norfolk Police Departments, and the Virginia State Police. This investigation was part of the Organized Crime Drug Enforcement Task Force (OCDETF). The OCDETF program is a federal, multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:15-cr-7.
Name
Age, Hometown
Charges
Status
Christopher Smith
32, Portsmouth
Conspiring to manufacture, distribute, and possess with intent to distribute over one kilogram of heroin; Possession of Firearms in Furtherance of a Drug Trafficking Crime
Pleaded guilty July 28. Sentenced to life in prison today.
Ricky Jackson
37, Hempstead, New York
Conspiracy to Distribute Narcotics
Pleaded guilty May 28, 2015. Sentenced to 280 months in prison today.
Junious Whitaker
28, Portsmouth
Conspiracy to Distribute Narcotics; Possession of Firearms in Furtherance of a Drug Trafficking Crime
Pleaded guilty March 18, 2015. Sentenced June 23, 2015 to 300 months in prison.
Howard Foust
31, Portsmouth
Conspiracy to Distribute Narcotics
Pleaded guilty Feb. 2, 2015. Sentenced to 223 months in prison today.
Jermarrieo Stigger
30, Virginia Beach
Conspiracy to Distribute Narcotics; Possession of Firearms in Furtherance of a Drug Trafficking Crime
Pleaded guilty on June 15. Sentenced Sept. 24, 2015 to 420 months in prison.
Dwayne Banks
XX, Portsmouth
Conspiracy to Distribute Narcotics
Pleaded guilty on July 30. Sentenced to 135 months in prison today.
####
Four Defendants Sentenced in Private Insurance Health Care Fraud SchemesRead the Press Release
Four defendants sentenced for their participation in various private health care fraud schemes.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Robert C. Hutchinson, Acting Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), Miami Field Office, J.D. Patterson, Director, Miami-Dade Police Department (MDPD), Ian A. Moffett, Chief, Miami-Dade Schools Police Department, Rodolfo Llanes, Chief, Miami Police Department (MPD), and Sergio Velazquez, Chief, Hialeah Police Department, made the announcement.
Hendris Castillo Morales, 33, of Miami, Maite Garcia, 40, of Hialeah, Osvaldo Marin Medina, 48, of Hialeah, and Alejandro Biart, 40, of Miami, were sentenced following their respective guilty pleas for their participation in schemes to defraud privately insured health care plans located in Miami-Dade County, including Cigna, Blue Cross Blue Shield (BCBS), United Health Care (UHC), Miami-Dade County Public Schools, City of Miami, Pepsi Co., BJ’s Wholesale Club, Inc., Lincoln Property Company, Macy’s Inc., Nextera Energy Inc., Radioshack Corporation, Sodexo, Inc., Southeast Frozen Foods Company LP, and other self-insured employers which offered Administrative Services Only (ASO) insurance plans to their employees. ASO insurance plans reimbursed Cigna, BCBS, and UHS for the money paid out by the insurance companies for health benefits for their respective employees. Therefore, the employers acted in a self-insured role, making them financially responsible for any claim payments to their employees.
The Honorable Robert N. Scola, Jr., United States District Judge, sentenced Hendris Castillo Morales to a term of 121 months’ incarceration, followed by a three-year term of supervised release and ordered restitution in the amount of $13,853,392. Judge Scola sentenced Maite Garcia to a term of 48 months’ incarceration, followed by a three-year term of supervised release and ordered restitution in the amount of $13,853,392.
The Honorable Ursula Ungaro United States District Judge, sentenced Osvaldo Medina to a term of 41 months’ incarceration, followed by a three-year term of supervised release. Judge Ungaro sentenced Alejandro Biart to a term of 41 months’ incarceration, followed by a three-year term of supervised release.
These four defendants are among fifteen individuals who have pled guilty to federal health care fraud conspiracy charges in two cases, United States v. Reynaldo Castillo, et al., Case No. 15-20144-Cr-Scola, and United States v. Ernesto Castillo, et al., Case No. 15-20177-Cr-Ungaro.
As alleged in the indictment in Case No. 15-20144-Cr-Scola, Reynaldo Castillo, Hendris Castillo Morales, Lisbet Castillo Batista, and Maite Garcia owned and controlled 30 companies based in Miami, Hialeah, Hialeah Lakes, and Doral, Florida. These individuals used medical director staffing companies to obtain and misappropriate the names and licensing information for numerous physicians. This information was then used to submit false and fraudulent claims to the private insurance plans.
The indictment further alleges that Alejandro Biart accepted kickbacks from co-conspirators in return for referring Cigna, BCBS, and UHC beneficiaries to the medical clinics controlled by Reynaldo Castillo, Hendris Castillo Morales, Lisbet Castillo Batista, and Maite Garcia. These beneficiaries signed documents falsely and fraudulently representing that they had received medical services when, in fact, they had not received medical services.
The indictment additionally charges Maite Garcia for her role in paying kickbacks and bribes to certain beneficiaries in order to reimburse the beneficiaries for their monthly premium payments to Cigna.
According to the indictment, Osvaldo Marin Medina, Humberto Martinez Rodriguez, Alejandro Jesus Cura, Dania Chavez, Ezequiel Severo Casas, Jose Gerardo Gonzalez, Julio Suarez, Nelson Ramos, Reinaldo Cinta Gonzalez, Rudy N. Dominguez and Duilys Martinez agreed, in exchange for a fee, to have companies be placed in their names, to open bank accounts and check cashing accounts in the names of the companies, and to cash and deposit checks received from Cigna, BCBS, and UHC.
The indictment alleges that as a result of this scheme, Reynaldo Castillo together with his co-conspirators, submitted and caused to be the submitted false and fraudulent claims to private insurance plans, including Cigna, BCBS, UHC, and ASO insurance plans managed by Cigna, BCBS, and UHC, on behalf of the medical clinics seeking approximately $125,676,324.00, as reimbursement for injection treatments, physical therapy treatments, and other medical items and services which were neither ordered by a physician nor provided to a beneficiary as claimed. Based on these false and fraudulent claims, Cigna, BCBS, and UHC, as well as, ASO insurance plans managed by Cigna, BCBS, and UHC, paid the medical clinics approximately $13,853,392.00.
The indictment further alleges that Reynaldo Castillo, Lisbet Castillo Batista, and Hendris Castillo incorporated Investors Group of Florida Corp. to receive proceeds from the medical clinics and utilized those proceeds to purchase real estate properties. Investors Group of Florida Corp. was listed as owner of the purchased real estate properties and acted as the leasing agent. Reynaldo Castillo was the president and registered agent of Investors Group of Florida Corp. The real properties are subject to criminal forfeiture as specified in the indictment.
Osvaldo Marin Medina and Alejandro Biart were also charged in United States v. Ernesto Castillo, et al., Case No. 15-20017-Cr-Ungaro, together with Ernesto Castillo, 43, of Hialeah, and Danny Jacomino Bordon, 50, of Miami, for Conspiracy to Commit Health Care Fraud and Health Care Fraud.
The indictment in Case No. 15-20017-Cr-Ungaro alleges that Ernesto Castillo, Osvaldo Marin Medina, Alejandro Biart, Danny Jacomino Bordon, and their co-conspirators submitted and caused Amazing Medical Services Inc. (Amazing) to submit claims to Cigna seeking reimbursement in the amount of approximately $1,111,183.00, which claims falsely and fraudulently represented that medical services were prescribed by a doctor and provided to Cigna beneficiaries by Amazing. As a result of such false and fraudulent claims, Cigna made payments to Amazing in the approximate amount of $86,035.00.
The indictment further alleges that Ernesto Castillo, Osvaldo Marin Medina, Alejandro Biart caused Serenity Rehabilitation Center, Inc. (Serenity) to submit fraudulent claims to Cigna seeking reimbursement in approximately $1,806,800.00, which resulted in reimbursement payments to Serenity in the approximate amount of $252,259.00. The defendants also caused World of Rehabilitation Therapy, Inc. (World Rehab) to submit fraudulent claims to Cigna seeking reimbursement in the amount of approximately $2,245,300.00, which resulted in payments to World of Rehab from Cigna in the approximate amount of $889,151.00.
The indictment also alleges that defendant Alejandro Biart accepted kickbacks from co-conspirators in return for referring Cigna beneficiaries to Amazing, Serenity, and World of Rehab.
Mr. Ferrer thanked the FBI, ICE-HSI, MDPD, Miami-Dade Schools Police Department, MPD, and the Hialeah Police Department for their investigative efforts. This case is being prosecuted by Assistant U.S. Attorney Christopher J. Clark.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Former Senate Staffer Sentenced to 38 Months for Defrauding Three WomenRead the Press Release
A former staff member of the U.S. Senate Committee on Commerce, Science and Transportation was sentenced today to 38 months in prison for a wire fraud scheme, announced Assistant Attorney General Leslie R. Caldwell of the Criminal Division, U.S. Attorney Dana J. Boente of the Eastern District of Virginia and Assistant Director in Charge Paul M. Abbate of the FBI’s Washington Field Office.
Robert Lee Foster, 65, formerly of Falls Church, Virginia, was also ordered to forfeit $499,622.54 and pay $503,003.37 in restitution as part of his sentence, which was imposed by Senior U.S. District Judge T.S. Ellis III of the Eastern District of Virginia. Foster pleaded guilty on July 31, 2015.
According to admissions made in connection with his guilty plea, between 2008 and May 2015, Foster devised a scheme to fraudulently obtain approximately $500,000 from three women in their 60s and 70s. Foster admitted that, to perpetuate the scheme, he gained the victims’ trust and confidence, after which he made various false statements to the victims to convince them to send him money. Among other things, Foster admitted that he told his victims he needed to borrow money to pay for litigation costs and business expenses that did not exist and for foreign travel that did not occur. Foster also admitted that he promised to repay the victims from large sums of money he claimed he was about to receive, which was another lie.
This case was investigated by the FBI’s Washington Field Office. Trial Attorneys Peter Halpern and Kevin Driscoll of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorneys Jamar Walker and Ryan Faulconer of the Eastern District of Virginia prosecuted the case.
Former Senate Staffer Sentenced to 3 Years for Defrauding Three WomenRead the Press Release
ALEXANDRIA, Va. – Robert Lee Foster, a former staff member of the U.S. Senate Committee on Commerce, Science, and Transportation, was sentenced today to 38 months in prison for a wire fraud scheme in which he defrauded three women of approximately $500,000. Foster was also ordered to forfeit $499,622.54 and pay $503,003.37 in restitution as part of his sentence.
Foster, 65, formerly of Falls Church, pleaded guilty on July 31, 2015. According to court documents, between 2008 and May 2015, Foster devised a scheme to fraudulently obtain approximately $500,000 from three women, whom he targeted because of their age, health, marital or family status, and other circumstances. To perpetuate the scheme, Foster gained the victims’ trust and confidence, after which he made various false statements to the victims to convince them to send him money. Among other things, Foster told his victims he needed to borrow money to pay for litigation costs, business expenses, and foreign travel, and that he would repay them from large sums of money he claimed he was about to receive. Foster’s statements were lies: he had no such costs or expenses, he did not even have a valid passport for much of the relevant period, and he was never “about” to receive any large sum of money. Foster spent the money he obtained from the three women for his own personal use and benefit, including more than $44,000 on golf-related expenses and tens of thousands in dining and clothing expenses. Foster received at least 10 separate wire transfers totaling $9,446.02 from Person A, a 61 year-old woman; 159 separate wire transfers totaling $461,676.52 from Person B, a 75 year-old woman; and 19 separate wire transfers totaling $28,500 from Person C, a 77 year-old woman.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Assistant Attorney General Leslie Caldwell of the Justice Department’s Criminal Division; and Paul M. Abbate, Assistant Director in Charge of the FBI’S Washington Field Office, made the announcement after sentencing by U.S. District Judge T. S. Ellis, III. Assistant U.S. Attorneys Jamar Walker and Ryan Faulconer, and Trial Attorneys Peter Halpern and Kevin Driscoll of the Public Integrity Section in the Justice Department’s Criminal Division prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:15-cr-148.
###
Former Immigration Officer Pleads Guilty to Concealing Relationship with Foreign National During Security Clearance InvestigationRead the Press Release
Jacksonville, Florida. – United States Attorney A. Lee Bentley, III announces that Paul Reynolds Friel, Jr. (47, Orange Park) pleaded guilty today to concealing material facts during an interview with a government agent. He faces a maximum sentence of five years in federal prison. His co-defendant, Marisol Del Carmen Rodriguez Chavarria (40, Orange Park), also pleaded guilty today, to possessing a visa that had been obtained by means of a false statement. She faces a maximum penalty of 10 years in federal prison. The sentencing dates have not yet been set.
According to court documents, Rodriguez entered the United States from Nicaragua on December 10, 2010, on an immigrant visa issued by the State Department. Her visa was granted based on the false representation that she intended to permanently reside with her American spouse, Luis Aguilar, at his residence. Court records indicate that Friel knew Rodriguez from previous trips to Nicaragua and that he had made the reservations and paid for her airfare to the United States. In March 2011, Rodriguez divorced her spouse and moved into an apartment with Friel. Thereafter, she and Friel lived together in a romantic relationship. In March 2012, they were married and later had a child together.
Friel was an immigration officer with U.S. Citizenship and Immigration Services. In December 2011, during a background investigation for a national security clearance, Friel failed to disclose his relationship with Rodriguez, a foreign national.
Rodriguez’s former spouse, Luis Aguilar, previously pleaded guilty to conspiracy to commit visa fraud, and is awaiting sentencing.
This case was investigated by the U.S. Department of Homeland Security, Office of Inspector General, and the Jacksonville office of the Federal Bureau of Investigation. It is being be prosecuted by Assistant United States Attorney Dale Campion.
Former Gates Mills postmaster sentenced to prison for theftRead the Press Release
The former postmaster of the Gates Mills Post Office was sentenced to 10 months in prison and ordered to repay approximately $57,000 that she stole, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Monica Weyler, Special Agent in Charge of the U.S. Postal Service -- Office of Inspector General, Eastern Area Field Office.
Ann Apana, 66, of Maple Heights, Ohio, was previously found on one count of theft of property used by the U.S. Postal Service.
From at least June 12, 2009 until June 15, 2014, as part of a continuing course of conduct, Apana stole approximately $38,741.42 in money and merchandise from the Postal Service and made approximately $18,341.08 in unauthorized purchases of postage using customers’ credit card information.
"The vast majority of the Postal Service's 600,000 employees are hardworking, dedicated individuals worthy of the American public's trust,” Weyler said. “Unfortunately, a small few decide to take advantage of that trust and steal from their employer and customers. Today's sentence shows that special agents with the U.S. Postal Service Office of Inspector General work diligently to identify those few individuals, and seek their prosecution and removal from employment. The message is clear -- if you steal from the Postal Service, you will go to jail and lose your job."
This case is being prosecuted by Assistant U.S. Attorney Miranda E. Dugi following an investigation by special agents of the U.S. Postal Service Office of Inspector General.
Former Bookkeeper Pleads Guilty to Embezzling from Tacoma Charity Thrift StoresRead the Press Release
The former bookkeeper for the St. Vincent de Paul Society Stores of Tacoma, Washington, pleaded guilty today in U.S. District Court in Tacoma to wire fraud and aggravated identity theft, announced United States Attorney Annette L. Hayes. ANGELA TONEY SAUCIDO, 44, moved from the Tacoma area to Phoenix in 2007, but continued to work for the charity as its bookkeeper through March 2013. As part of her plea agreement SAUCIDO will pay more than $543,000 in restitution to St. Vincent de Paul Society stores. Sentencing is scheduled in front of U.S. District Judge Benjamin H. Settle on January 25, 2016.
According to records in the case, the embezzlement scheme involved a variety of frauds. SAUCIDO would transfer funds from the St. Vincent de Paul Society Stores bank accounts to her own bank accounts and falsify entries making it appear the transfers were for legitimate purposes. SAUCIDO forged signatures on checks and made electronic fund transfers to benefit her and her family. SAUCIDO made purchases for her personal use on the St. Vincent de Paul Society Stores Home Depot credit account, and then used the charity’s funds to pay for the purchases. Finally, SAUCIDO used the identities of other employees to make it appear they had received additional pay when in fact she had deposited the money into bank accounts she and her husband controlled.
Wire fraud is punishable by up to 20 years in prison and a $250,000 fine. Aggravated Identity Theft is punishable by a mandatory two years of prison that must follow any term imposed on the wire fraud counts.
The case was investigated by the FBI and is being prosecuted by Assistant United States Attorney Matthew Hampton.
Former Area Controller Sentenced on Fraud & Money Laundering ChargesRead the Press Release
St. Louis, MO – KELLEY BARATTA was sentenced to 30 months in prison involving her scheme to embezzle money from her employer while she was controller of the company. Barrata was also ordered to pay more than $1.2 million in restitution to her former employer.
According to court documents, between 2007 and March 2012, Baratta was employed as controller of Media Management, Inc. (MMI) of Chesterfield, Missouri. She was responsible for payroll, accounts payable and receivable, and certain human resource matters. She initially performed these duties at the offices in Chesterfield, until she relocated to New York State, but continued to work as controller for MMI. After being terminated, MMI discovered that Barrata had embezzled from MMI between 2009 and 2012 by falsifying her salary in computer-based payroll system to cause the system to pay her an inflated salary. Additionally, Baratta was found to have transferred company funds directly to her bank account. In all, Baratta was found to have stolen $1,209,249 over the three-year period.
"The IRS enforces the nation's tax laws, but also takes particular interest in cases where someone, for their own personal benefit, has taken what belonged to others," said Andrew Thornton, Acting Special Agent in Charge of IRS Criminal Investigation.
Baratta, Auburn, NY, formerly of St. Louis County, pled guilty earlier this year to two felony counts of wire fraud and one felony count of money laundering. She appeared today for sentencing before United States District Judge Rodney Sippel.
This case was investigated by the Internal Revenue Service Criminal Investigation. Assistant United States Attorney Tom Albus handled the case for the U.S. Attorney’s Office.
Final Defendant Sentenced in State Department Contracting Fraud Scheme and Contractor Cover-UpRead the Press Release
ALEXANDRIA, Va. – Marvin Hulsey, 52, of Stafford, was sentenced today to one year and one day in prison, and two years of supervised release for conspiracy to commit wire fraud.
According to court documents, Hulsey, who was employed as a program manager for a government contractor, admitted to conspiring with Tony Chandler, 69, of Severn, Maryland, an employee of the State Department, to submit false invoices to the State Department in order to conceal unallowable costs for nutritional supplements purchased by employees under Hulsey’s supervision. As part of the scheme, Hulsey caused the employees to be reimbursed by his employer for the nutritional supplement purchases, and then caused false invoices to be made and submitted to the State Department for the cost of the nutritional supplements. Chandler, as an authorized distributor of the nutritional supplements for a multi-level marketing company, earned commissions in excess of $25,000 from the purchases made by Hulsey’s employees. Despite knowing that he was personally profiting from the sales of the nutritional supplements, Chandler, in his official capacity as an employee of the State Department, approved the majority of the false invoices. The false invoices submitted to the State Department as part of the scheme totaled more than $170,000.
In a related case, Curtis L. Wrenn, Jr., 60, of Triangle, pleaded guilty to making a false statement to the State Department by concealing that an internal investigation conducted by the contractor discovered credible information of fraud involving Chandler and Hulsey. Wrenn as president of the State Department contractor employing Hulsey, learned of Hulsey’s submission of false invoices to the State Department and of Chandler’s role in the scheme. Wrenn knew that he had a responsibility under the Federal Acquisition Regulation to timely disclose to the government credible evidence of fraud, but instead omitted facts related to the fraud from the final letter delivered to the State Department. After submitting the altered letter, Wrenn met with Chandler and told him he had “saved his bacon.” Wrenn later wrote in an email that he told Chandler “to get this resolved with minimal questions or we throw him under the bus.”
Hulsey pleaded guilty on July 24, 2015. In court documents filed on Oct. 5, 2015, Hulsey admitted that he engaged in a second fraud scheme in which he submitted false and inflated claims to the State Department related to a business owned by his wife. This second fraud scheme caused an additional loss of approximately $140,000.
Chandler and Wrenn both pleaded guilty on June 12, 2015, and were both sentenced on Sept. 18, 2015. Chandler was sentenced to six months in prison, while Wrenn was sentenced to one year of probation.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Steve A. Linick, Inspector General for the U.S. Department of State and Broadcasting Board of Governors; and Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after sentencing by U.S. District Judge Claud M. Hilton. Special Assistant U.S. Attorney Brian D. Harrison and Assistant U.S. Attorney Grace L. Hill prosecuted the case.
This case was investigated by the U.S. Department of State, Office of Inspector General (DOS-OIG) and the FBI’s Washington Field Office. Substantial assistance was provided by the Criminal Analysis Branch of the DOS-OIG
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:15-cr-137.
###
Federal Way Man Sentenced to Prison for Drug Conspiracy Involving Hash Oil BlastRead the Press Release
A Federal Way man who led an illegal marijuana “medibles” manufacturing operation was sentenced today in U.S. District Court in Tacoma to six years in prison and three years’ supervised release, announced U.S. Attorney Annette L. Hayes. KEVIN WEEKS 25, directed others to use highly flammable butane gas to make hash oil. On May 20, 2014 one operation at a Puyallup residence exploded and caught fire. The evidence showed that after the explosion, WEEKS threatened an associate to keep him working and to attempt to hide WEEKS’ own involvement. WEEKS pleaded guilty in April 2015 to Endangering Human Life While Manufacturing Controlled Substances, Maintaining a Drug Involved Premises and Manufacturing Hash Oil & Marijuana.
At sentencing U.S. District Judge Ronald B. Leighton said “What disturbs the court about this case is the disregard for human life. The process of manufacturing marijuana into hash oil is dangerous and stupid. Threatening other people to do your bidding makes it a perfect storm.”
“No one signed off on the use of dangerous manufacturing methods in residential neighborhoods when they voted to legalize marijuana,” said U.S. Attorney Annette L. Hayes. “Not only did the hash oil manufacturing process that this defendant used risk explosions, the final marijuana product was packaged to appeal to kids using an iconic logo from a children’s breakfast cereal. We will continue to investigate and prosecute these types of cases in coordination with our state and local partners.”
The hash oil manufacturing operation first came to the attention of law enforcement on May 20, 2014 when a large explosion shook a Puyallup residential neighborhood. WEEKS’ co-defendant Seth M. Cleek was working for WEEKS when he manufactured hash oil in the yard at the home and the explosive gas ignited. Butane canisters were hurled in every direction – putting those living near the scene, and first responders at risk. One canister was driven through a plastic planter – demonstrating the force of the explosion. Fortunately Cleek’s family, including an 18-month-old child, was not injured in the blast.
According to records filed in the case, WEEKS was paying Cleek $10 for each “tube” of marijuana he turned into butane honey oil (BHO). The process, which involves forcing butane gas through marijuana clippings packed in a tube, and then boiling off the solvent, can prove highly explosive. The fire resulting from the May 20, 2015 explosion melted the siding on the Puyallup home, damaged a parked car, and destroyed a plastic basketball backboard.
The investigation revealed that WEEKS was the operator of the marijuana “medible” company ‘Cap’n Cosmics. The company had no state license to make marijuana products, and used marketing that mimics the look of the children’s cereal, “Cap’n Crunch.” Even after the explosion at the Puyallup residence, WEEKS continued his hash oil manufacturing at a different location. WEEKS opened the BHO manufacturing operation in an industrial area using a method that could have resulted in a much greater and even more damaging explosion. In all some 1800 pounds of marijuana and marijuana laced food products were seized in the investigation.
The case was investigated by the Puyallup Police Department, Pierce County Sheriff’s Department, the Drug Enforcement Administration (DEA) and the Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF). The Pierce County Prosecutors Office assisted with the case. The case was prosecuted by Assistant United States Attorneys Vince Lombardi and Todd Greenberg.