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Tuesday 1 September 2015
Belleville Woman Sentenced to Prison for Scheme to Defraud Survivors Benefit Fund and Backstoppers, Inc.Read the Press Release
Pamela Denise Robtoy, 55, from Belleville, Illinois, was sentenced to a year and a day in federal prison as a result of her convictions for Mail Fraud and Wire Fraud in a Scheme to Defraud and Embezzle from the U.S. Marshals Survivors Benefit Fund and The BackStoppers, Inc. the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today. Following her release from prison, Robtoy was ordered to serve three years supervised release and pay restitution in the amount of $18,293.83.
Evidence revealed in Court showed that Robtoy embezzled funds from the 3rd Annual John Perry Golf Benefit held in October of 2013. The proceeds from the charitable event were to benefit the U.S. Marshals Survivors Benefit Fund and The BackStoppers, Inc. The Annual John Perry Golf Benefit Tournament was a charitable benefit held annually to remember Deputy U.S. Marshal John Brookman Perry, who was killed in the line of duty on Tuesday, March 8, 2011. The wire fraud count charged that Pamela Denise Robtoy sent an email to a Deputy United States Marshal falsely indicating that the checks to the U.S. Marshals Survivors Benefit Fund and The BackStoppers, Inc. had been reissued in an effort to avoid detection of her scheme.
The investigation was conducted by the Postal Inspection Service with the assistance of the Internal Revenue Service/Criminal Investigation and the U.S. Marshal's Service. The case was prosecuted by Assistant United States Attorney Norman R. Smith.
Belleville Woman Sentenced for Theft of Government FundsRead the Press Release
The United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today that Roshanda J. Story a/k/a Roshanda J. Guyton, 34, of Belleville, Illinois, was sentenced on the charge of Theft of Government Funds to a total of eight months in federal prison, to be followed by three years of supervised release. The court also ordered her to pay restitution of $2,379.25 to the Illinois Department of Human Services - Bureau of Child Care and Development, and a special assessment of $100.
Story admitted that from 2012 through May of 2013, she falsified documents in order to receive child care benefits from the Illinois Department of Human Services, which receives funds from the U.S. Department of Health and Human Services. In those documents Story fraudulently claimed that she was a single parent caring for a child and was in need of federally funded resources, when in fact she was at the time living with, and receiving assistance from, the father of the child.
The case was investigated by the U.S. Probation and Pretrial Services Office for the Southern District of Illinois with the assistance of the Illinois Department of Healthcare and Family Services, Office of Inspector General, Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorney William E. Coonan.
Bearded Bandit Sentenced to 70 MonthsRead the Press Release
Special Assistant U.S. Attorney Renee Green (619) 546-6775
NEWS RELEASE SUMMARY – September 1, 2015
SAN DIEGO – Christopher Andrew Gibson, dubbed the “Bearded Bandit,” was sentenced yesterday to 70 months in prison in connection with a string of bank robberies in the San Diego area in late 2014.
United States District Judge Marilyn L. Huff also ordered Gibson to pay restitution to the victim banks. During the sentencing hearing, prosecutors urged the judge to impose a significant sentence in part because of a bank teller’s continued emotional distress due to Gibson’s threats during one of the robberies.
In the course of the investigation, the Federal Bureau of Investigation learned that Gibson committed the first bank robbery within hours of being released from the George Bailey Detention Facility, where he was held on unrelated charges. Gibson was dubbed the “Bearded Bandit” because of the shaggy facial hair he had in the first two robberies.
According to his plea agreement, Gibson entered Wells Fargo Bank, located at 685 Saturn Boulevard, San Diego, on October 7, 2014, and presented a bank employee with a note that was paraphrased as follows: “I know your training. No dye packs. No GPS devices. I want $4,567. Hurry cause I'm not waiting all day.” Gibson then took approximately $1,419.00 from the employee and fled the bank.
Gibson admitted in his plea agreement that he followed up with a robbery a week later in Vista at a Chase Bank, located at 1641 South Melrose Drive, on October 15, 2014. During the robbery, Gibson presented a bank employee with a note, which in effect said, “I know your training. I want $4,788 in 15 seconds. No dye packs or GPS devices.” Gibson took approximately $2,240.00 from the employee and fled the bank.
Gibson’s final robbery occurred at a second Chase Bank, located at 985 Vista Way in Vista, on November 6, 2014. During the robbery, Gibson presented a bank employee with a note, reading to the effect, “Don't be stupid and press any buttons. I know your training so just cooperate. I want $4,000 and no GPS devices or dye packs. No fake bills. I'm counting to 30.” Gibson took approximately $4,000.00 from the employee and fled the bank. The demand notes were not recovered.
Gibson has been in custody since his arrest on November 10, 2014.
DEFENDANT
Christopher Andrew Gibson Age: 27 Vista, California
SUMMARY OF CHARGES
Counts 1-3: Bank Robbery – Title 18, U.S.C., Section 2113(a)
Maximum penalty: 20 years’ imprisonment and $250,000 fine
AGENCY
FBI
Area Tax Preparer and Client Indicted on Tax ChargesRead the Press Release
St. Louis, MO – RICKER BROOKS and ZONDRA JONES have been charged for their alleged preparation of false tax returns by overstating business expenses for the tax years 2009 and 2010. Brooks owns Brooks Accounting Service, providing accounting and tax preparation services. Jones owns Alliance In-Home Care Services, which provides home health care services to individuals.
The indictment alleges that after Jones reviewed the tax returns that Brooks prepared for her, she thought that the contract labor expense for her business was overstated. Although there was discussion between the two of them regarding the overstatement, Jones and Brooks agreed to file the tax returns with the overstatement. After the IRS began to investigate the returns, Brooks prepared false 1099 forms and check schedules, which falsely represented payments made by Alliance In-Home Care Services to contract employees. Jones provided these false documents to the IRS.
Brooks, St. Louis County, Missouri, was indicted by a federal grand jury on one felony count of conspiracy to defraud the US, and two felony counts of aiding and assisting in the preparation of a false income tax return; Jones, Florissant, Missouri, was indicted on one felony count of conspiracy and two felony counts of income tax evasion. The indictment was returned August 19, but remained sealed until the arrest of Mr. Brooks earlier today.
If convicted, each count of conspiracy and income tax evasion carries a maximum penalty of five years in prison and or fines up to $250,000; aiding in the preparation of a false income tax return carries a maximum penalty of three years prison and/or fines up to $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by IRS Criminal Investigation. Assistant United States Attorney Steven Muchnick is handling the case for the U.S. Attorney's Office.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
Another Guilty Plea in Norteno InvestigationRead the Press Release
BOISE – Richard Lobato, 51, of Nampa, Idaho, pleaded guilty today in United States District Court to distributing methamphetamine, U.S. Attorney Wendy J. Olson announced. Lobato was indicted by a federal grand jury on October 15, 2014.
According to the plea agreement, Lobato admitted that he distributed methamphetamine to a confidential informant on two occasions. On October 9, 2013, Lobato and another person sold approximately one-quarter of an ounce of methamphetamine to the informant. On October 23, 2013, Lobato sold another one-quarter of an ounce of methamphetamine to the informant.
The charge of distributing methamphetamine is punishable by a minimum term of imprisonment of five years and up to forty years, a maximum fine of $5 million, and a minimum term of four years supervised release. Lobato is scheduled to be sentenced on November 19, 2015, by Chief U.S. District Judge B. Lynn Winmill at the federal courthouse in Boise.
Lobato was charged as a result of an investigation by the Treasure Valley Metro Violent Crimes Task Force, which focused on the “Norteno” Northside gang that is active in Nampa and other parts of the Treasure Valley. Fourteen individuals were indicted on drug and gun charges as a result of the investigation. To date, seven defendants have been sentenced. Michael David Bradshaw, 31, of Nampa, was sentenced on August 6, 2015, to 66 months in prison for distributing methamphetamine. Guadalupe Serrano, 35, of Caldwell, was sentenced on April 21, 2015, to 75 months in prison for possession of methamphetamine with intent to distribute and for possessing firearms in furtherance of the drug trafficking crime. Nicole Danelle Nieto, 31, of Nampa, was sentenced on May 26, 2015, to 41 months in prison for distributing methamphetamine. Jose Manuel Menchaca, 35, of Nampa, was sentenced May 28, 2015, to 60 months in prison for distributing methamphetamine. On June 17, 2015, Brandi Larrea, 31, of Nampa, was sentenced to 48 months in prison for distributing methamphetamine and Tara Noelle Rivera, 30, of Nampa, was sentenced to 24 months in prison for distributing methamphetamine. Johnny Lee Martinez, 33, of Nampa, was sentenced on July 20, 2015, to 57 months in prison for distributing methamphetamine. Two others have pleaded guilty and are awaiting sentencing. Kenny P. Breedlove, 35, of California, is scheduled to be sentenced on October 15, 2015, and Guillermo Farias Jr., 29, of Nampa, is scheduled to be sentenced on September 15, 2015. Lobato was the tenth defendant to plead guilty. Two others are scheduled for trial including Jose Enrique Olvera Jr., 51, of Nampa, and Isaac Bright, 21, of Caldwell. Two defendants have outstanding warrants, including Ruben Rodriguez, 36, and Veronica Cantu, 26, both of Nampa.
These cases are the result of a joint investigation by the Treasure Valley Metro Violent Crime Task Force and the Organized Crime and Drug Enforcement Task Force (OCDETF). The Treasure Valley Metro Violent Crime Task Force is comprised of federal, state and local agencies, including the Federal Bureau of Investigation; Bureau of Alcohol, Tobacco, Firearms and Explosives; Boise Police Department; Ada County Sheriff’s Office; Caldwell Police Department; Nampa Police Department; Meridian Police Department; Canyon County Sheriff’s Office; and Idaho Department of Probation and Parole. The Organized Crime and Drug Enforcement Task Force (OCDETF), includes the cooperative law enforcement efforts of the Federal Bureau of Investigation; Drug Enforcement Administration; Bureau of Alcohol, Tobacco, Firearms and Explosives; U. S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Internal Revenue Service-Criminal Investigation; and U.S. Marshals Service. The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations.
These cases are being prosecuted by the Special Assistant U.S. Attorney hired by the Treasure Valley Partnership and the State of Idaho to address gang crimes. The Treasure Valley Partnership is comprised of a group of elected officials in southwest Idaho dedicated to regional coordination, cooperation, and collaboration on creating coherent regional growth. For more information, visit treasurevalleypartners.org.
Anderson Woman Sentenced to 105 Months for Fraud Involving Tax Refund ChecksRead the Press Release
Contact Person: Beth Drake (803) 929-3000
Columbia, South Carolina ---- United States Attorney Bill Nettles stated today that Helen Jean Anderson, age 57, of Anderson, South Carolina, was sentenced to 105 months for conspiracy to commit mail fraud, a violation of Title 18, United States Code, Section 1349. Senior United States District Henry M. Herlong, Jr. of Greenville imposed the sentence and ordered Anderson to pay $407,336.86 in restitution.
The evidence at the change of plea hearing established that Anderson and six co-conspirators, all of whom have been sentenced, would obtain the means of identification of other individuals and then file fraudulent tax returns. Anderson was the leader of the conspiracy. Once the treasury checks arrived, Anderson sought ways to negotiate them and recruited check passers in Anderson and Greenwood counties. The owner of a convenience store in the upstate told law enforcement that Helen Anderson had recently been in the store and claimed to have 200 Treasury checks to cash and said that she would pay the store’s owner $500 per check to cash them. The owner refused and contacted the police.
On August 6, 2013, a confidential informant working with United States Postal Inspectors met with Helen Anderson and was wired for audio and video. Anderson gave the informant multiple Treasury checks to cash. Anderson instructed the informant to bring her the money from the cashing of the checks within two days. She told the informant that she might have more Treasury checks available to cash once the informant returned the money to her.
In order to hide her ties to the Treasury checks, Anderson paid co-conspirators to allow her to use their addresses so checks and other tax documents would be sent to those addresses and would not obviously be associated with Anderson.
Law enforcement estimates that Anderson and her co-conspirators negotiated $483,294.40 in Treasury checks derived from fraudulent returns.
According to Special Agent in Charge Thomas J. Holloman III: “The Internal Revenue Service, Criminal Investigation is committed to protecting the honest taxpayers’ hard-earned money from ID thieves who endeavor to use those funds for their personal aggrandizement.”
Regarding identity theft, Mr. Nettles said the following: “The loss and pain caused by identity theft is enormous. The financial loss in the United States is in the billions of dollars. Victims spend untold hours trying to undo the damage caused by the offenders. Preventing and punishing identity thieves is, and will remain, a priority for the U.S. Attorney’s Office.”
The case was investigated by agents of the Internal Revenue Service, the United States Postal Inspection Service, and the Anderson County Sheriff’s Office. Assistant United States Attorney Bill Watkins of the Greenville office handled the case.
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Albuquerque Man Sentenced to Prison for Laundering Money for Major Narcotics Trafficking OrganizationRead the Press Release
ALBUQUERQUE – Jerome Eckstein, 39, of Albuquerque, N.M., was sentenced today in federal court to 15 months in prison followed by three years of supervised release for his money laundering conviction. Eckstein also was fined $46,100.55, reflecting the cost associated with his incarceration and term of supervised release.
Eckstein was one of 19 defendants charged in Dec. 2012, with drug trafficking and money laundering charges in a 60-count indictment. The indictment was superseded twice; first in Feb. 2014, to add a 20th defendant and a witness tampering charge, and again in Sept. 2014, to add another witness tampering charge and a heroin trafficking charge.
The charges filed in the case were the result of a 16-month multi-agency investigation into a drug trafficking organization headed by Christopher Roybal, 35, also of Albuquerque, which was led by the FBI, IRS and Albuquerque Police Department with assistance from the DEA, the HIDTA Region I Narcotic Task Force and the Bernalillo County Sheriff’s Office. The investigation, code-named “Operation Rain Check,” was designated as part of the Organized Crime Drug Enforcement Task Force (“OCDETF”) program. OCDETF is a nationwide Department of Justice program that combines the resources and unique expertise of federal agencies, along with their local counterparts, in a coordinated effort to disrupt and dismantle major drug trafficking organizations.
The original indictment charged Christopher Roybal and ten others, with conspiracy to distribute large quantities of cocaine in New Mexico between Aug. 2011 and Dec. 2012. It also charged Christopher Roybal and nine others with conspiracy to distribute marijuana between Oct. 2011 and Dec. 2012. Additionally, the indictment included three separate money laundering conspiracies, 22 money laundering offenses, and 18 “telephone counts,” offenses alleging the use of a communications device to facilitate a drug trafficking offense. The indictment was superseded in May 2014, to add a new charge against George Roybal, 53, of Albuquerque, alleging that he threatened an FBI informant to prevent the informant from testifying at the trial of this case which was then scheduled to begin on May 19, 2014. It was superseded again in Sept. 2014, to add two new charges alleging another defendant attempted to murder an FBI informant to prevent that informant from testifying at the trial of this case which was then scheduled to begin on Nov. 10, 2014, and with distributing heroin in Bernalillo County, N.M., in May 2014.
On March 5, 2015, Eckstein pled guilty to a money laundering charge in the second superseding indictment. In entering his guilty plea, Eckstein admitted that between Nov. 2011 and Dec. 2012, he received a large sum of cash from an undercover agent as part of a sting operation. Eckstein further admitted that he should have known that the undercover agent was holding himself out to be a drug dealer and that the cash he provided to Eckstein were drug proceeds. Eckstein admitted paying money back to the undercover agent with checks made payable to fictitious companies for work that was never performed.
With the exception of one defendant who is participating in a pretrial diversion program under the supervision of the U.S. Probation Office, all 18 defendants have entered guilty pleas.
This case was investigated by the Albuquerque office of the FBI, IRS Criminal Investigation and the Albuquerque Police Department, with assistance from the DEA, the HIDTA Region I Narcotics Task Force and the Bernalillo County Sheriff’s Office. Assistant U.S. Attorneys Joel R. Meyers and Shana B. Long are prosecuting the case. Assistant U.S. Attorney Stephen R. Kotz is responsible for litigating the related civil asset forfeiture actions.
The HIDTA Region I Narcotics Task Force is comprised of the Albuquerque Police Department, Albuquerque office of the DEA, Pojoaque Tribal Police Department, Rio Rancho Police Department, Sandoval County Sheriff’s Office and the Valencia County Sheriff’s Office. The High Intensity Drug Trafficking Areas (HIDTA) program was created by Congress with the Anti-Drug Abuse Act of 1988. HIDTA is a program of the White House Office of National Drug Control Policy (ONDCP) which provides assistance to federal, state, local and tribal law enforcement agencies operating in areas determined to be critical drug-trafficking regions of the United States and seeks to reduce drug trafficking and production by facilitating coordinated law enforcement activities and information sharing.
Alabama Woman Sentenced for Involvement in $2.5 Million Stolen Identity Tax Refund Fraud RingRead the Press Release
A Phenix City, Alabama, woman was sentenced to prison today in U.S. District Court for the Middle District of Alabama for her involvement in a stolen identity tax fraud scheme, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department's Tax Division and U.S. Attorney George L. Beck Jr. of the Middle District of Alabama announced today.
Lasondra Miles Davis, 37, pleaded guilty earlier this year to one count of aggravated identity theft. Chief U.S. District Judge W. Keith Watkins of the Middle District of Alabama sentenced Davis to serve 24 months in prison to be followed by one year of supervised release and ordered her to pay $1,941 in restitution to the Internal Revenue Service (IRS). Davis’ mother, Teresa Floyd, pleaded guilty earlier this year to one count of conspiracy to defraud the United States and one count of aggravated identity theft. Floyd will be sentenced on Oct. 15.
According to court documents, between March 2011 and May 2014, Davis and Floyd operated several tax preparation businesses in the Phenix City area, including T & L Tax Service. Davis obtained stolen identities which, according to allegations in the superseding indictment, Floyd then used to file more than 900 false federal income tax returns that claimed more than $2.5 million in tax refunds. Davis, Floyd and others caused the fraudulently obtained refund checks to be cashed at several businesses in Alabama and Georgia.
Acting Assistant Attorney General Ciraolo and U.S. Attorney Beck Jr. commended special agents of IRS-Criminal Investigation, who investigated the case, and Trial Attorneys Michael C. Boteler and Michael P. Hatzimichalis of the Tax Division and Assistant U.S. Attorney Jonathan Ross of the Middle District of Alabama, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Akron man indicted for selling fentanyl that caused fatal overdoseRead the Press Release
An Akron man was indicted for selling fentanyl he obtained from China that resulted in a fatal overdose earlier this year, law enforcement officials said.
Leroy Shuarod Steele, 35, was indicted on two counts: conspiracy to possess with intent to distribute fentanyl and distribution of fentanyl. Count two specifies that the fentanyl Steele distributed resulted in the fatal overdose of a person identified only as T.R. on March 21, 2015 in Akron.
Also named in the indictment are Sabrina M. Robinson, 34, and Ryan Sumlin, 26, both of Akron.
Steele, Robinson and Sumlin conspired together between March and April of this year to possess and distribute fentanyl. They obtained fentanyl from suppliers in China and then distributed the drug to people in Akron, Fairlawn and elsewhere, according to the indictment.
Sumlin faces an additional charge of distribution of fentanyl.
“A human life was snuffed out because of the poison this defendant brought to Akron,” said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio. “This tragedy underscores the danger of using heroin or fentanyl. Making the mistake of using this drug even once might be the last mistake a person ever makes.”
The investigation is ongoing.
This case is being prosecuted by Assistant U.S. Attorney Linda H. Barr following an investigation by the Drug Enforcement Agency, the Akron Police Department and the Fairlawn Police Department.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Acting Associate Attorney General Stuart F. Delery Delivers Remarks at A Servicemembers Town Hall at Fort StewartRead the Press Release
FORT STEWART, GEORGIA
Thank you, Ed, for the kind introduction and thank you to everyone in your office who helped put together this visit. And thank you to the 3rd Infantry Division and the entire Fort Stewart community for inviting me and for providing me with such a warm welcome. It is a great honor to be here. Seeing firsthand your dedication and commitment to serving our country in the Armed Forces is inspiring and motivating.
Through the lens of my responsibilities at the Department of Justice, I have had the privilege and the duty to learn about the work that you do. I am fortunate that my work has touched on a remarkable range of interesting issues, from defending court challenges to the health care law and to environmental regulations to investigating and prosecuting hate crimes to protecting the safety of the medicines we take and the food we eat. But throughout my time at the department, the Attorney General has identified “combating terrorism and other national security threats at home and abroad” – using every available and appropriate tool to keep the American people safe – as the department’s highest priority.
As the department has defended the legality of terrorism watch lists or represented current and former military officers when they are sued for things they have done in service to the country, I have opened a small window into the military world – a world that, as the Supreme Court has said, is, “by necessity, a specialized society separate from civilian society,” that has, “by necessity, developed laws and traditions of its own during its long history.” I have seen the scope and difficulty of the essential work of the military and of the intelligence community, and the essential contributions that individual servicemembers make.
One lesson I have taken from these experiences is how important it is for those of us on the civilian side of the government who interact with the military to do more to understand its culture and traditions, its unique needs and pressures. To perform the role we play in defending the actions of the Department of Defense and other national security agencies, we at the Justice Department need to bridge any divide between ourselves and our clients. That is one of the reasons why I am grateful for the chance to be here today.
But the connection between the Justice Department and the military is not limited to defending national security programs when they are challenged in court. We also have a responsibility to protect your rights and interests, as servicemembers and, later, as veterans. It is that responsibility I want to focus on in my remarks to you today.
It is a sad reality that servicemembers face many obstacles and challenges both during and after military service. You should not have to worry that the equipment you use in the course of protecting and securing our country is unsafe or defective. You should not have to worry while you are overseas that your car will be repossessed or that your home will be subject to an illegal foreclosure without your knowledge. You should not have to worry that you will be targeted by a financial scam that could threaten your hard-earned savings or, should you later join the Reserves, that you will lose your civilian job when you report for duty.
And yet, far too often, we see these things happen. We see unscrupulous businesses attempt to take advantage of the stresses a servicemember faces while preparing for a deployment or of the added difficulties your families face when you are deployed. It is vital that we hold those people accountable – that we at the Justice Department do our jobs in enforcing the criminal and civil laws designed to protect servicemembers, veterans and their families so that you can focus on your invaluable work protecting our nation.
That is why I was honored earlier this year to announce the Attorney General’s creation of the Justice Department’s Servicemembers and Veterans Initiative – a coordinated effort to ensure that the legal protections relating to servicemembers’ rights and interests are made real for men and women in uniform across the country.
I want to talk today about three ways in which the department’s enforcement efforts are working – by helping to ensure you have the right equipment and support to do your job safely abroad; by protecting your financial and voting rights while you are serving your country; and by providing you all of the support you are entitled to by law when you transition back to civilian life.
As members of the Armed Forces, you sacrifice so much. You are asked to leave your friends and family and travel to distant locations, where you may have to put yourself in harm’s way in order to secure our nation. The government should provide you with the tools you need to do that job. The Department of Justice helps ensure that you only are given equipment that meets performance standards by aggressively pursuing lawsuits against defense contractors who have provided defective, unsafe, or counterfeit devices to the military.
For example, imagine serving in a unit engaged in nighttime combat in Iraq. In covert or search-and-rescue operations, you rely on high-powered flares for illumination – three-foot-long tubes filled with propellant that burn in excess of 3,000 degrees Fahrenheit. Your safety depends on those flares working the way they are supposed to, providing the light you need and not creating an additional hazard when you already have too many to worry about.
And yet, several years ago, a whistleblower alerted the government that a company making many of the flares used in Iraq and Afghanistan had knowingly been selling defective ones. An investigation found that the flares the company had delivered could not withstand a ten foot drop without exploding or igniting – and that the company was aware of this defect.
Confronted with these facts, the company agreed to pay the federal government $21 million. More importantly, under the settlement the company also spent an additional $16 million to retrofit the 76,000 unsafe flares remaining in the military’s inventory – that is, to make sure the soldiers in the field would have safe flares going forward.
The Justice Department’s efforts to ensure that contractors live up to their obligations to provide safe, reliable products to the military also extend to bringing criminal charges where appropriate. Take the case of a contractor that provided defective wing pins to the Department of Defense. You may know that wing pins secure the wings of F-15 fighter aircraft. The contractor promised that it would make the pins using a certain type of hardened steel and subject them to a rigorous safety inspection process. But it didn’t: some of the wing pins were made with the wrong type of steel and many were not subjected to proper safety testing. When the former owner of the contractor was questioned about the defective parts, he provided forged documents falsely claiming that a third-party testing company had conducted the necessary safety tests. He was recently sentenced to six months in prison.
Ensuring that the equipment you use meets critical safety and performance standards is an important priority for our government. But our country’s obligation to you does not end on the battlefield. We also have an obligation to ensure that the rights you and your family have are protected at home while you serve overseas. The Department of Justice works to meet this obligation by enforcing laws that protect your financial and voting rights while you serve on active duty, allowing you to focus on your critical jobs.
One such law is the Servicemembers Civil Relief Act (SCRA) which provides protections for servicemembers who are entering active duty by postponing or suspending certain obligations associated with rental agreements, automobile leases, mortgage foreclosures, evictions, security deposits, installment contracts, student loan payments and more. It also eases financial burdens by providing relief from some credit obligations and court proceedings while you are on active duty. This law is intended to allow servicemembers to focus on deployment and to reduce the stress placed on family members while their loved ones are away. It was also created in recognition of the fact that servicemembers frequently have your lives disrupted with little advance notice, which may have serious financial implications for you and your families.
Many of you have probably heard stories of servicemembers who have lost homes, cars, or belongings while they were deployed. Some of you may have been the victims of fraud yourselves. The Department of Justice is committed taking action in these cases. We have used the SCRA to obtain $60 million dollars in compensation to nearly 78,000 servicemembers who were charged excess interest on their student loans by Navient Corporation, the student loan servicer that was formerly part of Sallie Mae. We are in the process of obtaining relief for hundreds of servicemembers who were subjected to wrongful mortgage foreclosures or interest rate violations by five of the country’s largest mortgage lenders; already, 952 servicemembers and their co-borrowers have received over $123 million from four banks and mortgage lenders who improperly foreclosed on the servicemembers’ homes without going to court. The banks also committed to repairing any negative credit reporting that occurred as a result of these wrongful foreclosures.
Many of the cases the Justice Department brings address improper foreclosures or repossessions on a large scale. For example, earlier this year the department settled allegations that a motor vehicle lender, Santander Consumer USA, had improperly repossessed or collected fees from the repossession of over a thousand vehicles belonging to servicemembers. But these cases often begin not with thousands of complaints, but with one complaint. The investigation of Santander started when a single soldier, Army Specialist Joshua Davis, contacted Army Legal Assistance after his car was repossessed in the middle of the night while he was at basic training. Army Specialist Davis’s complaint made its way to the Justice Department and the resulting investigation revealed evidence not only that that the repossession of Army Specialist Davis’s car was illegal, but that hundreds of other servicemembers had suffered similar illegal repossessions at the hands of the same lender. The SCRA requires a court to review and approve of any repossession if the servicemember took out a loan and made a payment before entering military service. By failing to obtain court orders before repossessing these automobiles, Santander prevented the court from reviewing whether these repossessions should be delayed or adjusted in light of the owners’ military service. Santander wound up paying at least $9.35 million to over 1,000 servicemembers, the largest settlement for illegal automobile repossessions ever obtained by the United States. And it all started with a single servicemember calling attention to conduct that was affecting many of his peers too.
Another obstacle servicemembers and their families can face is difficulty voting while overseas. The Department of Justice enforces the Uniformed and Overseas Citizens Absentee Voting Act, which requires states and territories to allow servicemembers to register and vote absentee in federal elections, as well as in some state and local elections. The Department of Justice recently filed suit in Illinois to ensure that military and overseas citizens of Illinois have sufficient time to vote in special elections for filling vacancies in the U.S. House of Representatives. And in another recent case, the state of West Virginia was ordered by a court to count ballots submitted by military and overseas voters that may have been received after Election Day due to the state’s failure to send ballots to these voters in a timely fashion.
Of course, the challenges faced by servicemembers are not limited to times of active duty. These challenges are often compounded by new issues stemming from military service, such as post-traumatic stress disorder, traumatic brain injuries, substance abuse and other issues that affect reentry to civilian life. That is why we provided grants to support Veterans’ Treatment Courts, which link veterans to programs, benefits and services that may assist in their recovery. We also use our grants to support the efforts of other courts, organizations and law enforcement that provide assistance to servicemembers and veterans who become involved in the criminal justice system and to support mentoring programs and services for youth with a parent in the military.
New challenges also come for servicemembers who join the Reserves, when your military obligations can lead to unfair treatment by civilian employers. Consider the case of Sergeant Timothy Stoner, an Army National Guardsman and college campus police officer who was denied two promotions due to his military duties. Sergeant Stoner is a Sergeant First Class in the Army National Guard with 21 years of military service, including active duty deployments in Afghanistan and Iraq. He has been a campus police officer at Pima Community College in Arizona since 2001, but was repeatedly denied promotions.
It became clear to him that the reason was that the police chief did not approve of his service in the Guard. Sergeant Stoner first applied for the promotion while deployed in Afghanistan and the police chief reportedly called him “selfish” for seeking promotion while he was “volunteering,” as the chief put it, for active military duty. On another occasion, the police chief said that military servicemembers are so used to taking orders that they cannot think for themselves and do not do well in stressful situations. And yet another time, during one of his interviews for the promotion, the police chief questioned whether Sergeant Stoner would retire from military service and became upset when he said that he did not plan to retire.
The Justice Department obtained relief for Sergeant Stoner under the Uniformed Services Employment and Reemployment Rights Act (USERRA) which is a statute created to protect servicemembers who have experienced discrimination in their civilian employment based on their military service or status. USERRA ensures that servicemembers are not disadvantaged in their civilian jobs and are promptly reemployed in these jobs upon returning from duty. This means that employers cannot deny servicemembers promotions they would have reasonably obtained if not for their military service. This also means that employers cannot deny servicemembers their seniority, status and rate of pay they would have received if not for their military service. It means that employers cannot deny applicants a position or withdraw employment offers based on their military service.
Sergeant Stoner is one of the thousands of servicemembers for whom the Department of Justice has sought relief under USERRA. But our goal in bringing these cases extends beyond helping deserving men and women vindicate their rights in the civilian workforce. It is about changing the culture of businesses that would discriminate against servicemembers. As part of the resolution of Sergeant Stoner’s case, for example, the Justice Department required his employer to change its personnel policies to advise all of its employees of their rights and obligations under USERRA.
Before concluding, I want to briefly circle back to the Justice Department’s Servicemembers and Veterans Initiative, which I mentioned towards the beginning of my remarks. One goal of the Initiative is to better coordinate and expand our enforcement efforts – to work closely with federal, state and local enforcement agencies, and with the Departments of Defense and Veterans Affairs, to ensure that we are identifying and addressing the areas in which we can best assist the military community. We will continue to raise awareness of these issues in our discussions with military leadership, as well as with the JAG Corps, which provides legal counseling on base. But we also encourage victims of to come forward and complain. Too often a violation of the rights of servicemembers – particularly financial fraud -- goes unreported because victims feel embarrassed or foolish, or because they think that nothing will happen. But only when you complain is it possible for you to get the help you need. And only when we know there is a problem can we work to stop it.
We also want to make sure that we are doing all we can to ensure that you are aware of the legal protections available to you, and of how to take advantage of these protections if you encounter illegal practices. And because we can’t prosecute our way out of every problem, we are engaging in and supporting consumer education where possible to prevent veterans and servicemembers like you from becoming victims of financial fraud and other illegal activity in the first place.
Our efforts in this Initiative are led by three career Department of Justice attorneys with strong ties to the military community, including Director Silas Darden, a Major in the Air Force Reserves, who is here today. These attorneys serve as a central point of contact on issues affecting servicemembers and veterans so that we may ensure that all available tools are used to address each problem or concern. We want to make sure that all of you and your colleagues across the country, know that this resource is there and how to tap into it.
Going forward, we hope to further strengthen our comprehensive legal support and protection network for servicemembers, veterans and families so that you may focus on your important service to our country.
Thank you again for the invitation to be here today. I look forward to meeting many more of you and to hearing your input on how the Department of Justice can better help you and your families live securely in this country that you protect and defend. Thank you for your time and thank you for your service.
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Monday 31 August 2015
Woman Sentenced for Conspiracy in Kickbacks on Glock FirearmsRead the Press Release
TOPEKA, KAN. – A Georgia woman was sentenced to 12 months and a day in federal prison for helping conceal bribes an executive of the company that makes Glock firearms received from a Kansas firearms distributor for preferential treatment, U.S. Attorney Barry Grissom said.
Lisa Delaine Dutton, 43, Acworth, Ga., pleaded guilty to one count of conspiracy.
In her plea, she admitted she assisted her husband, co-defendant James “Craig” Dutton, 43, Acworth, Ga., who was the Assistant National Sales Manager for Glock, to receive bribes from co-defendant John Sullivan Ralph, III, 41, Olathe, Kan. Ralph was owner of Global Guns & Hunting Inc. of Olathe, Kan., doing business as OMB Guns.
Lisa Dutton created a company called Supreme Solutions LLC and used it to receive payments from Ralph to James Dutton. The bribes were to pay James Dutton for helping Ralph to receive preferential treatment over other distributors of firearms, including directing customers to OMB Guns, giving it priority relative to the allocation of limited products, steering government contracts and sales to government agencies of firearms and accessories to OMB , as well as providing confidential Glock information to Ralph and OMB Guns.
Co-defendants include:
John Sullivan Ralph, II, who is set for sentencing Sept. 28.
James Craig Dutton, who is set for sentencing Sept. 22.
Welcome D. “Bo” Wood, Jr., who is set for sentencing Nov. 16.
Paula Ann Wood, who is set for sentencing Nov. 16.
Grissom commended the FBI and Assistant U.S. Attorney Richard Hathaway for their work on the case.
United States Extradites Suspect in Quadruple Murder to the Czech RepublicRead the Press Release
The U.S. government extradited U.S. citizen Kevin Dahlgren to the Czech Republic today to stand trial on murder charges in that country.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Dana J. Boente of the Eastern District of Virginia and Assistant Director in Charge Andrew G. McCabe of the FBI’s Washington Field Office made the announcement.
Dahlgren, 23, formerly of Sacramento, California, is wanted for the brutal murders of four of his extended family members, on or about May 21, 2013, at their home in Brno, Czech Republic. According to court documents, Dahlgren was visiting those family members and left that country immediately after the murders. On May 23, 2013, U.S. law enforcement authorities arrested Dahlgren upon his arrival in the United States at Dulles International Airport, Virginia, based upon a provisional arrest request by the government of the Czech Republic pursuant to its extradition treaty with the United States.
After hearings in 2013 before the U.S. District Court for the Eastern District of Virginia, Dahlgren’s extradition was certified. Thereafter, Dahlgren’s further appeals were denied. Dahlgren has been detained throughout his extradition proceedings and appeals.
The FBI, including personnel from the Legal Attache’s office in Prague, the Washington Field Office and the International Operations Division at FBI headquarters, coordinated U.S. law enforcement efforts with Czech authorities and transported the fugitive to the Czech Republic. The U.S. Attorney’s Office for the Eastern District of Virginia and the Criminal Division’s Office of International Affairs and Appellate Section represented the interests of the Czech Republic in proceedings before the U.S. courts.
Dahlgren Extradition Complaint
U.S. Attorney’s Office participates in duffle bag drive benefitting foster childrenRead the Press Release
LAFAYETTE, La. – The U.S. Attorney’s Office, joined by U.S. Courts in Lafayette and Shreveport, donated 45 bags last week as part of the “Duffle Bag Drive” for children in foster care hosted by the Department of Children and Family Services and Townsquare Media.
The duffle bags, sports bags, backpacks and suitcases collected during the drive will give foster children something to carry their belongings in when moving from one home to another. There are more than 400 children in foster care in our area. Of the 45 bags donated, four were suitcases, 20 were duffle bags, 10 were backpacks and 11 were other assorted bags. The bags were delivered to the Department of Children and Family Services office in Lafayette last week.
“I’m grateful to the members of our staff and members of the U.S. Courts who participated in this drive,” Finley stated. “This donation will make a foster child’s life a little easier when transitioning to a new home, which also assists the Department of Children and Family Services with their mission.”
According to the Louisiana Department of Children and Family Services, Foster care is a protective service intended to provide temporary care for children who must live apart from their parents because of child abuse, neglect or special family circumstances requiring the need for out-of-home care. The first goal of foster care is to reunite the child with his or her biological family; however, adoption of the child may be the outcome. To find out more about becoming a foster parent, visit www.dcfs.la.gov/foster or call 1-888-524-3578.
The U.S. Attorney’s Office is active with community outreach, to include educating youth in middle schools and high schools on social media and cyberbullying, mentoring high school and college students during back-to-school and career day events, supporting law enforcement during National Night Out events, serving meals during Thanksgiving at St. Joseph Diner, participating in events such as the Alzheimers’ Walk and Susan G. Komen Race for the Cure, and hosting annual drives for Coats for Kids, Dress for Success and Feds Feed Families.
Finley is the first female U.S. Attorney to serve in Louisiana. She was selected by President Barack Obama in January of 2010, after being recommended by U.S. Senator Mary Landrieu, and confirmed by the U.S. Senate in June of 2010. United States Attorney Finley was sworn into office on June 2, 2010, to serve as the Western District of Louisiana’s chief law enforcement officer for 42 of the 64 parishes in the state. In addition to her duties as the U.S. Attorney, Finley is a Lieutenant Colonel in the U.S. Air Force and currently serves as Co-Chair of the U.S. Attorney’s Office of Management and Budget Committee.
Two plead guilty to federal oxymorphone chargesRead the Press Release
Huntington, W.Va. – United States Attorney Booth Goodwin announced today that Karson Williams, 21, of Charleston, entered a guilty plea today to aiding and abetting the distribution of oxymporphone. During his plea hearing, Williams admitted that on January 14, 2014, he sold a confidential informant working with law enforcement a 40 mg oxymorphone pill, which is commonly known as “Opana”, in exchange for $80.00. The drug deal took place at 21A Balies Drive in Nitro, West Virginia. Williams admitted that he aided and abetted Bridgette Kelly in the drug sale.
Bridgette Kelly previously entered a guilty plea to conspiracy to distribute oxymorphone and is schedule to be sentenced on September 14, 2015.
Williams faces up to 20 years imprisonment when he is sentenced on December 7, 2015, by Chief United States District Court Judge Robert C. Chambers.
Jennifer Russell, who leased the residence at 21A Bailes Drive, also entered a guilty plea in federal court today, to one count of knowingly maintaining a residence for the purpose of distributing oxymorphone and faces up to 20 years imprisonment. Russell is set to be sentenced on December 7, 2015.
These cases were investigated by the Metropolitan Drug Enforcement Network Team and the prosecution is being handled by Assistant United States Attorney Monica D. Coleman. These cases are being prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and heroin. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
Two men plead guilty in Detroit to Huntington heroin conspiracyRead the Press Release
HUNTINGTON, W.Va. – Two men who participated in a heroin conspiracy between 2012 and 2014 pleaded guilty today to federal drug charges, announced U.S. Attorney Booth Goodwin. Kenneth E. Baxter, 25, of Detroit entered a guilty plea to distributing heroin. Coty S. Richardson, 24, of South Point, entered a guilty plea to attempting to possess with intent to distribute 100 grams or more of heroin. Both hearings were held in federal court in Huntington before Chief United States District Judge Robert C. Chambers.
From at least November of 2012 to December 8, 2014, Baxter led a conspiracy that involved the transportation of heroin from Detroit to Huntington for distribution. Once in Huntington, Baxter provided heroin to others, including Richardson, for distribution from multiple residences in the Huntington area. Baxter was also personally engaged in the distribution and sold heroin to confidential informants on four separate occasions between April and December 2014.
One of the residences secured by the group was at 403 Homestead Place in Huntington. Richardson arranged for the lease of the residence and the residence was used to prepare and distribute heroin. On December 6, 2014, a postal inspector with the United States Postal Inspection Service intercepted a package addressed for the residence containing approximately 230 grams of heroin. Agents delivered the package that day and executed a search warrant at the residence after the package was accepted. When agents entered the residence, Richardson was observed throwing the package from a second floor window. When Richardson was arrested, agents seized heroin, paraphernalia used to package and distribute heroin, and firearms from the residence.
Multiple others have been convicted for their respective roles in the conspiracy including Paul A. Roberts, who pleaded guilty to maintaining a residence for the distribution of heroin in March 2015, Ramone L. Wells, who pleaded guilty to conspiracy to distribute heroin in June 2015, Pricilla Lee Dylan, who pleaded guilty to maintaining a residence for the distribution of heroin in August 2015, and Dustin S. Barton, who pleaded guilty to distributing heroin in August 2015.
Baxter faces up to 20 years in federal prison, and is scheduled to be sentenced on November 30, 2015. Richardson faces up to 40 years in federal prison when he is sentenced on November 30, 2015.
The Huntington FBI Drug Task Force, United States Postal Service, West Virginia State Police and Huntington Police Department conducted the investigation. Assistant United States Attorney Joseph F. Adams is in charge of 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 U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
Two Perry County Residents Sentenced for Methamphetamine OffenseRead the Press Release
On August 27, 2015, and August 31, 2015, Joseph E. Soldan, Sr., 45, of Tamaroa, and Donald K. Brown, Jr., 32, of DuQuoin, were sentenced for their involvement in a methamphetamine conspiracy, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
Both Soldan and Brown had previously pled guilty to a one-count indictment charging them and four others with conspiracy to manufacture methamphetamine. Soldan was sentenced to 151 months in federal prison, to be followed by 3 years’ supervised release, and fined $850.00. Soldan was given 17 months’ credit for time served on related state case for a total prison sentence of 134 months. Brown was sentenced to 100 months in federal prison, to be followed by 3 years’ supervised release, and fined $725.00. The offense occurred between 2012 and September 2014, in Perry, Jackson, Randolph, Williamson, and Franklin Counties. Evidence at the plea and sentencing hearings established that Soldan and Brown were involved with each other and with others in the manufacture of methamphetamine. At sentencing, the district court found Soldan responsible for 55.2 grams of pseudoephedrine, which was possessed for the purpose of manufacturing methamphetamine. Brown was found responsible for 165.36 grams of pseudoephedrine. Three co-defendants have previously been sentenced for their roles in the methamphetamine conspiracy. One co-defendant has pled guilty and is awaiting sentencing.
The ongoing investigation is being conducted by the Jackson County Sheriff’s Office, Perry County Sheriff’s Office, Perry County Drug Task Force, Murphysboro Police Department, and DuQuoin Police Department. The Pinckneyville Police Department and Illinois State Police Methamphetamine Response Team assisted in the investigation.
The case is assigned to Assistant United States Attorney Amanda A. Robertson for prosecution.
Tohono O’odham Receives Nearly $215,000 in Federal Grant Money to Support Sex Offender Registration and Notification Act (SORNA)Read the Press Release
PHOENIX – Today, U.S. Attorney John S. Leonardo announced that $214,481 in additional grant funds will be made available to the Tohono O’odham Nation to support, maintain, and refine jurisdiction-wide SORNA programs and functions. These funds will assist in improving victim notification services and in increasing service capacity by hiring a SORNA specialist. The grant funds were awarded by the Bureau of Justice Assistance (“BJA”), which is a component of the Department of Justice’s Office of Justice Programs (“OJP”).
“We are committed to protecting the public from convicted sex offenders and offenders against children,” said U.S. Attorney Leonardo. “We encourage all agencies to be proactive and apply for future grant funding through our Office of Justice Programs.”
Additional information about BJA and its programs is available at: https://www.bja.gov/Default.aspx
Information about OJP and its programs can be found at:http://www.ojp.usdoj.gov.
RELEASE NUMBER: 2015-065_TOHONO O GRANT (2015-AW-BX-0011)
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For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.
Russian Nuclear Energy Official Pleads Guilty to Money Laundering Conspiracy Involving Violations of the Foreign Corrupt Practices ActRead the Press Release
U.S. Conspirators Paid Over $2 Million to Influence Russian Nuclear Energy Official and to Secure Business with State-Owned Russian Nuclear Energy Company
A Russian official residing in Maryland pleaded guilty today to conspiracy to commit money laundering in connection with his role in arranging over $2 million in corrupt payments to influence the awarding of contracts with the Russian state-owned nuclear energy corporation.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Rod J. Rosenstein of the District of Maryland, Deputy Inspector General John R. Hartman of the U.S. Department of Energy-Office of Inspector General (DOE-OIG) and Assistant Director in Charge Andrew G. McCabe of the FBI’s Washington, D.C., Field Office made the announcement.
Vadim Mikerin, 56, of Chevy Chase, Maryland, pleaded guilty before U.S. District Judge Theodore D. Chuang of the District of Maryland. Sentencing is scheduled before Judge Chuang on Dec. 8, 2015.
According to court documents, Mikerin was the president of TENAM Corporation and a director of the Pan American Department of JSC Techsnabexport (TENEX). TENAM, based in Bethesda, Maryland, is a wholly-owned subsidiary and the official representative of TENEX in the United States. TENEX, based in Moscow, acts as the sole supplier and exporter of Russian Federation uranium and uranium enrichment services to nuclear power companies worldwide. TENEX is a subsidiary of Russia’s State Atomic Energy Corporation.
In connection with the scheme, Daren Condrey, 50, of Glenwood, Maryland, pleaded guilty on June 17, 2015, to conspiring to violate the Foreign Corrupt Practices Act (FCPA) and conspiring to commit wire fraud, and will be sentenced on Nov. 2, 2015. Boris Rubizhevsky, 64, of Closter, New Jersey, pleaded guilty on June 15, 2015, to conspiracy to commit money laundering and will be sentenced on Oct. 19, 2015.
According to court documents, between 2004 and October 2014, Mikerin conspired with Condrey, Rubizhevsky and others to transmit funds from Maryland and elsewhere in the United States to offshore shell company bank accounts located in Cyprus, Latvia and Switzerland. Mikerin admitted the funds were transmitted with the intent to promote a corrupt payment scheme that violated the FCPA. Specifically, he admitted that the corrupt payments were made by conspirators to influence Mikerin and to secure improper business advantages for U.S. companies that did business with TENEX. Mikerin further admitted that he and others used consulting agreements and code words such as “lucky figure,” “LF,” “cake” and “remuneration” to disguise the corrupt payments.
According to court documents, over the course of the scheme, Mikerin conspired with Condrey, Rubizhevsky and others to transfer approximately $2,126,622 from the United States to offshore shell company bank accounts. As part of his plea agreement, Mikerin has agreed to the entry of a forfeiture money judgment in that amount.
The case was investigated by DOE-OIG and the FBI. The case is being prosecuted by Trial Attorneys Christopher Cestaro, Ephraim Wernick and Derek Ettinger of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys David I. Salem and Michael T. Packard of the District of Maryland.
Mikerin Plea Agreement
Russian Nuclear Energy Official Pleads Guilty to Money Laundering Conspiracy Involving Violations of the Federal Corrupt Practices ActRead the Press Release
Greenbelt, Maryland - Vadim Mikerin, age 56, a Russian official residing in Chevy Chase, Maryland, pleaded guilty today to conspiracy to commit money laundering in connection with his role in arranging over $2 million in corrupt payments to influence the awarding of contracts with the Russian state-owned nuclear energy corporation.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Assistant Attorney General Leslie R. Caldwell of the U.S. Department of Justice Criminal Division; John R. Hartman, Deputy Inspector General for Investigations, Office of Inspector General at the U.S. Department of Energy; and Assistant Director in Charge Andrew G. McCabe of the Federal Bureau of Investigation - Washington Field Office.
According to court documents, Mikerin was the president of TENAM Corporation and a director of the Pan American Department of JSC Techsnabexport (TENEX). TENAM, based in Bethesda, Maryland, is a wholly-owned subsidiary and the official representative of TENEX in the United States. TENEX, based in Moscow, acts as the sole supplier and exporter of Russian Federation uranium and uranium enrichment services to nuclear power companies worldwide. TENEX is a subsidiary of Russia’s State Atomic Energy Corporation.
In connection with the scheme, Daren Condrey, 50, of Glenwood, Maryland, pleaded guilty on June 17, 2015, to conspiring to violate the Foreign Corrupt Practices Act (FCPA) and conspiring to commit wire fraud, and will be sentenced on Nov. 2, 2015. Boris Rubizhevsky, 64, of Closter, New Jersey, pleaded guilty on June 15, 2015, to conspiracy to commit money laundering and will be sentenced on Oct. 19, 2015.
According to court documents, between 2004 and October 2014, Mikerin conspired with Condrey, Rubizhevsky and others to transmit funds from Maryland and elsewhere in the United States to offshore shell company bank accounts located in Cyprus, Latvia and Switzerland. Mikerin admitted the funds were transmitted with the intent to promote a corrupt payment scheme that violated the FCPA. Specifically, he admitted that the corrupt payments were made by conspirators to influence Mikerin and to secure improper business advantages for U.S. companies that did business with TENEX. Mikerin further admitted that he and others used consulting agreements and code words such as “lucky figure,” “LF,” “cake” and “remuneration” to disguise the corrupt payments.
According to court documents, over the course of the scheme, Mikerin conspired with Condrey, Rubizhevsky and others to transfer approximately $2,126,622 from the United States to offshore shell company bank accounts. As part of his plea agreement, Mikerin has agreed to the entry of a forfeiture money judgment in that amount.
U.S. District Judge Theodore D. Chuang has scheduled sentencing for Mikerin on Dec. 8, 2015, at10:00 a.m. EDT.
United States Attorney Rod J. Rosenstein praised the DOE-OIG and FBI for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys David I. Salem and Michael T. Packard, and Trial Attorneys Christopher Cestaro, Ephraim Wernick, and Derek Ettinger of the U.S. Department of Justice Fraud Section, who are prosecuting the case.
Rochester Man Pleads Guilty to Drug ChargeRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
ROCHESTER, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that Edward Mighty, 38, of Rochester, NY, pleaded guilty before Chief U.S. District Judge Frank P. Geraci, Jr. to conspiracy to possess with intent to distribute and to distribute five kilograms or more of cocaine and 280 grams or more of crack cocaine, and possession of firearms in furtherance of a drug trafficking crime. The charges carry a mandatory minimum penalty of 25 years in prison, a maximum of life, a fine of $20,250,000 or both. The defendant will also forfeit over $3,000 in cash seized at 54 Strong Street in connection with the investigation.“As we have said before, this Office stands ready to use federal tools and resources to assist local law enforcement when appropriate,” said U.S. Attorney Hochul. “The proven ability of our Office to eliminate an entire criminal organization, combined with the substantial sentences facing the members, are just two of the reasons for the public to embrace this approach.”
Mighty was arrested in February 2015 along with Seymour Brown, Andre Taylor a/k/a Stamma, Ricardo Bailey a/k/a Diji, Robert Wilson a/k/a Bose, and Kenneth Harper a/k/a Frenchy a/k/a Pudge, Desmond Bice a/k/a Dez, and Christopher Samuels a/k/a Cutty, all of Rochester. In addition, Winifredo Gonzales, of Brooklyn, NY, was charged by criminal complaint on February 11, 2015 with conspiracy to possess with intent to distribute five kilograms or more of cocaine and possession of firearms in furtherance of a drug trafficking crime.
Assistant U.S. Attorney Robert A. Marangola, who is handling the case, stated that Mighty is one of the leaders of a Rochester-based drug trafficking organization. The defendant obtained kilogram quantities cocaine from Winifredo Gonzales in Brooklyn that were transported to Rochester. The powder cocaine was processed, re-packaged, and distributed in various quantities of both powder and crack cocaine through multiple sellers in the greater Rochester area. Mighty had several members of his drug trafficking organization utilize their cell phones to conduct the drug business. These individuals include Andre Taylor, Seymour Brown, and Ricardo Bailey. The defendant’s organization supplied numerous upper and mid-level cocaine distributors, including Robert Wilson and Wilson’s partner Kenneth Harper. Wilson further supplied, among other individuals, Desmond Bice. Christopher Samuels worked with Bice in further distributing the cocaine.
On February 10, 2015, law enforcement monitored a vehicle utilized by the organization to transport kilograms of cocaine from Brooklyn to Rochester. Shortly before 2:30 pm, surveillance officers observed the vehicle arrive at 126 New Jersey Avenue in Brooklyn and depart about 15 minutes later. As agents executed a search warrant and arrested Gonzales at 126 New Jersey Avenue, other agents monitored the vehicle as it traveled to Rochester. Inside the Brooklyn residence, law enforcement officers found 17 kilograms of cocaine in a hydraulic secret compartment behind a wall with two handguns, including an UZI 9mm pistol. Agents also seized approximately $70,000 in U.S. currency wrapped in black tape and plastic wrap from a safe.
The vehicle was monitored as it traveled from Brooklyn to 54 Strong Street in Rochester, the center of the Rochester drug distribution activities. The trap car arrived at 54 Strong Street shortly after 10:00 pm. A few minutes later, officers executed search warrants on 54 Strong Street, the trap car, and 319 Alphonso Street. At 54 Strong Street, Mighty was taken into custody along with Bailey, who was the driver of the trap car in which officers later found one kilogram of cocaine in a hydraulic compartment behind the front center vent. Andre Taylor fled on foot running through the snow-covered backyards, and was taken into custody in the vicinity of 93 Tyler Street, a short distance away. Inside 54 Strong Street, a Glock .40 caliber semi-automatic handgun loaded with 11 rounds of live ammunition, 13 rounds of live .357 caliber ammunition, Western Union receipts, multiple cell phones, drug distribution paraphernalia, and $3,941 in U.S. currency were seized.
Brown was arrested at his residence at 319 Alphonso Drive in Rochester. During the search of that location, officers seized multiple cell phones, a loaded .357 caliber handgun, and $3,147 in U.S. currency.
To date, four defendants have pleaded guilty to drug trafficking and firearms charges.The plea is the culmination of a joint federal and state wiretap investigation on the part of the Organized Crime Drug Enforcement Task Force, the Rochester Police Department, under the direction of Chief Michael Ciminelli, the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Delano A. Reid, New York Field Division, and the Monroe County District Attorney's Office, under the direction of Sandra Doorley.
Reading Man Sentenced for Exploiting ChildrenRead the Press Release
Danny Ray Evans, Jr., 26, of Reading, PA, was sentenced today to 225 months in prison for production of child pornography. Evans, who pleaded guilty to the charges, engaged in a series of “Skype” webcam discussions with at least three different 12 and 13-year old girls during which he threatened and coerced them into engaging in sexually explicit conduct on camera. Evans saved “Screen shots” of these sessions with the minors and also shared the photographs with his father who lives in Georgia.
In addition to the prison term, U.S. District Court Judge James Knoll Gardner ordered five years of supervised release and a $200 special assessment. The defendant must also register as a sex offender.
The case was investigated by the Federal Bureau of Investigation, the Berks County Detectives, and the Berks County District Attorney's Office. It was prosecuted by Assistant United States Attorney Michelle Morgan.
Putnam County man pleads guilty to federal drug chargesRead the Press Release
CHARLESTON, W.Va. – A Putnam County man pleaded guilty today to five federal drug charges, announced U.S. Attorney Booth Goodwin. Christian Garrett Thornton, 29, of Bancroft, pleaded guilty in federal court in Charleston to four counts of distributing oxymorphone and one count of possessing oxymorphone with the intent to distribute it. Thornton admitted that on four occasions between February 24 and March 23, 2015, he sold Opana pills in Kanawha and Putnam Counties to a cooperating individual working with law enforcement. Thornton further admitted to possessing additional Opana pills on March 25, 2015, that he intended to distribute.
Thornton faces up to twenty years of imprisonment on each count when he is sentenced on January 13, 2016.
The investigation was conducted by the Metropolitan Drug Enforcement Network Team. Assistant United States Attorney Jennifer Rada Herrald is in charge of the prosecution.
This case is part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and heroin. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of pills and heroin in communities across the Southern District.
Pittsburgh Man Pleads Guilty in Bank Fraud SchemeRead the Press Release
PITTSBURGH, PA - A resident of Allegheny County, Pennsylvania, has pleaded guilty in federal court in Pittsburgh on a charge of conspiracy, United States Attorney David J. Hickton announced today.
Eric Tyrone Bates, Jr., 29, of Pittsburgh, PA, pleaded guilty to one count before United States District Judge Mark Hornak.
According to the information presented to the court, beginning in 2013, Bates and another person conspired together to steal bank account information belonging to an account holder at Citizens Bank in Pittsburgh, which information they used to make create accounts at other banks which they controlled to make multiple withdrawals of cash.
Judge Hornak scheduled sentencing for Jan. 7, 2016 at 11 a.m. The law provides for a maximum total sentence of not more than five years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Gregory C. Melucci is prosecuting this case on behalf of the government.
The Western Pennsylvania Financial Crimes Task Force (WPFCTF), conducted the investigation that led to the successful prosecution of Bates. The WPFCTF was established as a collaborative, multi-agency effort to effectively combat financial crimes, including identity fraud, in Western Pennsylvania. Partnering in this effort are the United States Attorney's Office for the Western District of Pennsylvania, the United States Secret Service, the United States Postal Inspection Service, the Department of Homeland Security, the Allegheny County District Attorney's Office, the Allegheny County Police Department, the City of Pittsburgh Bureau of Police and the Pennsylvania State Police.
Oviedo Man Sentenced to Ten Years for Receiving Child PornographyRead the Press Release
Orlando, Florida – U.S. District Judge John Antoon, II has sentenced Stephen Longest (27, Oviedo) to 10 years in federal prison for receiving child pornography. He was also ordered to pay $5,500 in restitution to a victim of the offense, and to forfeit the computers and electronic devices he had used to commit the crime. Longest pleaded guilty on April 2, 2015.
According to court documents, for at least four years, Longest used a file-sharing program to receive thousands of images depicting the sexual abuse of infants and young children. Law enforcement agents executed a search warrant at his home and located hundreds of child pornography images on his smart phone and computers.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
This case was investigated by Federal Bureau of Investigation. It was prosecuted by Assistant United States Attorney Karen L. Gable.
Niagara Falls Man Arrested, Charged by Complaint with Gun ChargeRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
BUFFALO, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that Philip Vincent, 37, of Niagara Falls, NY, was arrested and charged by criminal complaint with being a felon in possession of a firearm. The charge carries a maximum penalty of 10 years and a $250,000 fine.Assistant U.S. Attorney George C. Burgasser, who is handling the case, stated that according to the complaint, on December 2, 2014, the U.S. Marshals Violent Felony Fugitive Task Force encountered the defendant while looking for a fugitive defendant. Officers searched Vincent’s 20th Street residence and discovered a .38 caliber revolver. As a prior felon, the defendant was prohibited from legally possessing a gun.
Vincent made an initial appearance today before U.S. Magistrate Judge H. Kenneth Schroeder and was released on home detention. The defendant is due back in court on September 3, 2015 at 10:00 a.m. before U.S. Magistrate Judge Hugh B. Scott.
The complaint is the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Delano A. Reid, New York Field Division, the U.S. Marshals Service, under the direction of Charles Salina, and the Niagara Falls Police Department, under the direction of Chief Bryan DalPorto.
New York Woman Convicted of Mortgage Office Burglary and Fraud SchemeRead the Press Release
NEWPORT NEWS, Va. – Anika N. Greene, 42, of Bronx, New York, was convicted today by a federal jury on charges of conspiracy to commit bank and wire fraud, bank fraud, wire fraud, access device fraud and three counts of aggravated identity theft.
Green was charged in a superseding indicted on July 15, 2014. According to court records and evidence presented at trial, Greene and three other individuals, Jeffrey Washington, Alice Howard, and Catya J. Craig, burglarized Wells Fargo mortgage offices throughout New York, New Jersey, Connecticut and Maryland in 2012 and 2013. The defendants stole over 1,800 mortgage files that were then used in a variety of bank customer impersonation and retail credit fraud schemes, targeting various banks and retailers. Washington recruited individuals to go into banks, impersonate customers and remove funds via setting up business accounts and transferring funds from the accounts of bank customers. Washington and other defendants, including Greene, traveled from New York to the Eastern District of Virginia on multiple occasions throughout 2012 and 2013.
Green faces a maximum penalty of 30 years in prison for the conspiracy to commit bank and wire fraud, and bank fraud convictions; 20 years on the wire fraud conviction; 10 years on the access device fraud conviction; and 24 months consecutive to all other counts on each of the aggravated identity convictions. Green will be sentenced on December 3, 2015. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Washington pleaded guilty to conspiracy to commit bank fraud and aggravated identity theft for which he was sentenced to 176 months in prison. Craig pleaded guilty to conspiracy to commit bank fraud and was sentenced to 21 months in prison. Howard pleaded guilty to conspiracy to commit bank fraud and aggravated identity theft and was sentenced to 65 months in prison.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Kathy A. Michalko, Special Agent in Charge of the U.S. Secret Service’s Washington Field Office; David G. Bowers, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service; and Richard W. Myers, Chief of Newport News Police, made the announcement after the verdict was accepted by U.S. District Judge Arenda L. Wright Allen. Assistant U.S. Attorneys Brian J. Samuels and Kaitlin C. Gratton 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. 4:14-cr-32.
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Mexican Man Gets Max for Delivering Grenades to Undercover AgentsRead the Press Release
McALLEN, Texas – Mario Alberto Garcia-Balderas, 45, of Mexico, has been ordered to prison following his convictions related to unlawful possession of firearms, announced U.S. Attorney Kenneth Magidson.
A federal jury convicted Garcia-Balderas Feb. 23, 2015, following a four-day trial of both counts as charged – being an alien illegally and unlawfully in the United States in possession of a firearm and for being a felon in possession of a firearm. Today, Chief U.S. District Judge Ricardo Hinojosa, who presided over trial, ordered Garcia-Balderas serve the statutory maximum of 10 years in federal prison.
The court also sentenced Garcia-Balderas in a separate case which charged him with the immigration offense of re-entry after deportation to which he had previously pleaded guilty. The court sentenced him to 96 months in federal prison, 30 months of which was ordered to be served consecutively to the sentence in the firearms case.
In handing down the sentence, Judge Hinojosa noted that he had sentenced Garcia-Balderas twice before in federal cases and yet he still illegally re-entered the country and committed this very serious crime involving grenades. As an illegal alien, Garcia-Balderas is again expected to face deportation proceedings following his release from prison.
“Today's sentencing sends a clear message to individuals who purchase, transport or facilitate the attempted smuggling of weapons, ammunition and other related items, said Special Agent in Charge James Spero of Homeland Security Investigations (HSI) in San Antonio. “Preventing these items from being acquired from or delivered to the wrong hands is a top priority for HSI. We will continue working with our domestic and international law enforcement partners in this effort.”
The investigation began in September 2009 after federal agents received information that an individual or individuals were offering grenades for sale in the United States. Testimony at trial indicated Garcia-Balderas delivered improvised explosive device grenades to undercover agents on three occasions – Sept. 17, Sept. 21, and Sept. 28, 2009. Prior to the delivery of the grenades on Sept. 21, Garcia-Balderas received payment for the grenades in currency totaling $24,960.
Garcia-Balderas stipulated to the fact that he is a citizen of Mexico and that he had no status to be in the United States legally during 2009. He also agreed that prior to September 2009, he was previously convicted of a crime punishable by imprisonment for a term exceeding one year.
As an illegal alien and a convicted felon, he is prohibited by federal law of possessing firearms or ammunition.
Garcia-Balderas will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The charges are the result of an investigation by HSI and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney Toni Trevino is prosecuting the case.
Medway Man Pleads Guilty to Extortion ActivitiesRead the Press Release
BOSTON – Baljit Singh Rehal, a/k/a Joel Rehal, pleaded guilty today in U.S. District Court in Worcester to an extortion charge.
Rehal, 31, pleaded guilty to one count of collection of extension of credit by extortionate means. In October 2014, Rehal and another man were arrested after the issuance of a criminal complaint against them on the same charges. Sentencing is scheduled for Nov. 20, 2015.
Between Dec. 21, 2012 and Jan. 10, 2014, Rehal and others perpetrated a scheme whereby they convinced a victim that he owed money to the FBI for an alleged whistleblower investigation, and proceeded to collect $180,000 from the victim for payment of this alleged investigation. When the victim could not come up with the money, Rehal and others would purportedly loan the victim money and have him sign promissory notes to repay the money to them.
The maximum sentence under the statute is 20 years in prison, followed by 3 years of supervised release and a $250,000 fine, or twice the amount of the 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.
United States Attorney Carmen M. Ortiz and Joseph R. Bonavolonta, Acting Special Agent in Charge of the Federal Bureau of Investigation. Boston Field Division, made the announcement today. The case is being prosecuted by Michelle L. Dineen Jerrett of Ortiz’s Worcester Branch Office.
Marijuana Grow Site Eradicated on Routt National ForestRead the Press Release
DENVER – Two Mexican Nationals in the country illegally were arrested based on a Criminal Complaint when law enforcement found a large marijuana grow in the Routt National Forest, the U.S. Attorney’s Office, the U.S. Forest Service, Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and the Routt County Sheriff’s Office announced. The two arrested, Alfonso Rodriguez-Vazquez and Nestor Fabian Sinaloa-Sinaloa, made their initial appearance before a U.S. Magistrate Judge in Denver this afternoon. Both are due back in court on Thursday, September 3, 2015 at 10:00 a.m. for a detention hearing and a preliminary hearing. Both are currently in custody.
The 3/4-acre illegal grow site was located in the Buffalo Pass area, northeast of Steamboat Springs, Colorado. The eradication team collected approximately 1,000 plants and removed camping gear from the site. Additional site clean-up of trash and other items will be ongoing by the U.S. Forest Service.
The grow was found after suspicious activity was reported to the U.S. Forest Service by a citizen, leading to the discovery of the grow site by law enforcement.
The defendants were each charged with the manufacture of marijuana. If convicted, the defendants face not less than 5 years, and not more than 40 years in federal prison. They also each face up to a $5,000,000 fine.
“Abusing the lands that belong to all citizens in order to make drug money is going to get you prosecuted,” said U.S. Attorney John Walsh. “Special thanks to the Forest Service, Homeland Security Investigations and the Routt County Sheriff for putting an end to this abuse in the Routt Forest.”
“Under federal law, marijuana possession, use, or cultivation remains illegal on national forest lands” said U.S. Forest Service Special Agent in Charge, Laura Mark. “The Forest Service remains committed to providing safety to forest visitors and employees and protecting the natural resources.” “This includes taking enforcement action for possession, use and cultivation of marijuana on national forest lands.”
“This now-dismantled extensive marijuana grow operation on federal lands in Colorado shows all the signs of a sophisticated drug trafficking organization,” said David A. Thompson, special agent in charge of HSI Denver. “HSI is working together with our other law enforcement partners to investigate this case to identify all those associated with this operation.”
According to the Forest Service, illegal marijuana cultivation poses a public safety risk and also directly harms the environment. The illegal use of pesticides can cause extensive long-term damage to natural resources. For example, the supply of public drinking water for hundreds of miles may be impacted because of one marijuana growing site. Overall, the negative impact of marijuana sites on natural resources is severe. Human waste, trash and the use of pesticides are widespread, contamination from sites affects fish and wildlife habitats, and soil erosion is common. In addition, water usage is extreme because each marijuana plant is estimated to require a gallon of water per day – water that is critical to native vegetation, wildlife and public drinking water sources.
This matter was investigated by the U.S. Forest Service, Homeland Security Investigations, and the Routt County Sheriff’s Office.
The defendants are being prosecuted by Special Assistant U.S. Attorney Geoffrey Rieman.
The charges contained in the Criminal Complaint are allegations, and the defendants are presumed innocent until proven guilty.
A Criminal Complaint is a probable cause charging document. Anyone accused of committing of felony violation of federal law is entitled to be indicted by a grand jury.
Forest visitors are urged to be observant while recreating in secluded areas and to back out and contact the U.S. Forest Service Law Enforcement at (303) 275-5266, or your local law enforcement agency if they come across suspicious activities.
Man Sentenced for Filing False Tax ReturnsRead the Press Release
United States Attorney Deborah R. Gilg announced that on August 28, 2015, United States District Judge John M. Gerrard sentenced Joshua Miles, to five years’ probation with conditions that he serve 12 consecutive weekends in jail. Mr. Miles was also ordered to pay $56,508 in restitution, jointly and severally with co-defendant Magalita Gelin. A similar sentenced was previously imposed on Gelin on May 11, 2015.
From February, 2009, until August, 2010, Magalita Gelin and Joshua Miles electronically filed fraudulent tax returns for a number of people and received refunds from these bogus returns. People who were generally not previously known to Miles and Gelin went to the Miles-Gelin residence in Bellevue, Nebraska, and had the bogus tax returns prepared and filed. Some individuals in whose names returns were filed were jail inmates where Miles worked. The bogus tax returns were false in a number of respects, including: (1) the returns claimed the taxpayer had worked, typically at Wendy’s, Burger King, Walmart, or Omaha Steaks, when no such employment occurred, and the corresponding W2 reflected income and taxes withheld, figures which were similarly false; and (2) sometimes there was a claim of exemption for non-existent dependents.
A total of approximately 31 false tax returns were filed claiming refunds totaling approximately $111,444.00, which in turn caused the Internal Revenue Service to make tax refund payments to Gelin and Miles totaling approximately $56,508.00.
“Manipulating our nation’s tax system victimizes all honest law-abiding citizens,” said Sybil A. Smith, IRS Criminal Investigation Special Agent in Charge, St. Louis Field Office.
This case was investigated by IRS Criminal Investigation.
Man Sentenced to 3 Years in Prison for Syracuse Credit Union RobberyRead the Press Release
SYRACUSE, NEW YORK – Ronald Reid, 52, of Rochester, New York, was sentenced on August 27, 2015 to three years in prison for robbery of a credit union in Syracuse, New York, announced United States Attorney Richard S. Hartunian, Federal Bureau of Investigation Special Agent in Charge Andrew Vale, and Syracuse Police Chief Frank Fowler. United States District Judge David N. Hurd also sentenced Reid to three years of supervised release following his jail term and restitution.
The charge stemmed from the robbery of the Summit Federal Credit Union, 1400 Erie Boulevard East, Syracuse, New York, on January 26, 2015. On that day, Reid walked into the credit union and presented a note which read, "Give me the money." After the teller complied, Reid left with $240.00 before Syracuse police arrived. He was arrested the following day in Utica, New York.
This case was investigated by the Syracuse Police Department and the Federal Bureau of Investigation, with assistance from the Utica Police Department, and was prosecuted by Assistant United States Attorney Michael F. Perry.
Los Lunas Man Arraigned on Federal Production of Child Pornography OffensesRead the Press Release
ALBUQUERQUE – Martin Perea, 35, of Los Lunas, N.M., was arraigned this morning in federal court in Albuquerque, N.M., on an indictment charging him with nine counts of production of visual depictions of minors engaged in sexually explicit conduct.
The nine-count indictment, which was filed by a federal grand jury on Aug. 25, 2015, alleges that Perea induced and coerced a minor to engage in sexually explicit conduct for the purpose of producing child pornography on nine separate occasions between Oct. 2014 and March 2015. The indictment further alleges that Perea committed these crimes in Valencia County, N.M.
Perea was arrested on Aug. 4, 2015, by the FBI on a criminal complaint charging him with production and possession of child pornography, and made his first appearance in federal court the following day. He has been in custody since that time and remains detained pending trial, which has yet to be scheduled.
According to the criminal complaint filed in this case, the FBI began an investigation into Perea on July 24, 2015, when the Valencia County Sheriff’s Office reported receiving information from the Spokane (Washington) Police Department alleging that Perea sexually abused an eight-year-old child and produced child pornography.
The complaint alleges that on July 1, 2015, the victim’s mother discovered pornographic images and videos of Perea and the victim on a memory card she took from Perea’s cellular telephone. The mother allegedly confronted Perea about the pornographic photographs and videos later that day. Two days later, the mother fled with the victim to Spokane, Wash., after Perea allegedly threatened to burn her and her home if she did not return the memory card to him. Once in Spokane, the mother contacted local law enforcement authorities to file a complaint against Perea.
After the memory card was transferred from the Spokane Police Department to the Valencia County Sheriff’s Office, the FBI obtained a federal search warrant for the card. On July 28, 2015, the search warrant was executed at the New Mexico Regional Computer Forensic Laboratory where the contents of the memory card were downloaded. The complaint alleges that the memory card contained approximately 111 video files and more than 980 image files, including multiple videos and images which allegedly contained child pornography.
If convicted on the production of child pornography charge, Perea faces a prison sentence of not less than 15 years and not more than 30 years in federal prison. Perea also would be required to register as a sex offender. Charges in criminal complaints and indictments are merely accusations and criminal defendants are presumed innocent unless found guilty beyond a reasonable doubt.
This case was investigated by the Albuquerque office of the FBI, the Valencia County Sheriff’s Office and the New Mexico Computer Forensic Laboratory with assistance from the Spokane Police Department.
The case is being prosecuted by Assistant U.S. Attorney Shammara H. Henderson as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice (DOJ) to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and DOJ’s Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
The case also was brought as a part of the New Mexico Internet Crimes Against Children (ICAC) Task Force’s mission, which is to locate, track, and capture Internet child sexual predators and Internet child pornographers in New Mexico. There are 82 federal, state and local law enforcement agencies associated with the New Mexico ICAC Task Force, which is funded by a grant administered by the NMAGO. Anyone with information relating to suspected child predators and suspected child abuse is encouraged to contact federal or local law enforcement.
Lincoln Man Sentenced for Conspiracy to Distribute MethamphetamineRead the Press Release
United States Attorney Deborah R. Gilg announced that on August 28, 2015, William Nathan Chandler, 39, of Lincoln was sentenced to 10 years (120 months) in prison for conspiracy to distribute and possess with the intent to distribute 500 grams or more of a mixture or substance containing methamphetamine between about January 1, 2012, and April 4, 2014. Following the prison term, Chandler will serve five years on supervised release.
Information provided to law enforcement indicated that Chandler was responsible for the distribution of at least 500 grams (approximately 18 ounces) of methamphetamine. In April of 2014, a search warrant was executed at Chandler’s residence. During the search, officers found slightly less than ¼ ounce of methamphetamine. Chandler waived his rights and admitted that he had sold approximately ½ ounce of methamphetamine on that day prior to the officers’ arrival. He said he had been using and selling methamphetamine for about six years and estimated he had sold a total of a pound in the year prior to the search.
This case was investigated by the Lincoln/Lancaster County Drug Task Force.
Leader of Philadelphia to Morgantown heroin, oxycodone trafficking scheme sentencedRead the Press Release
CLARKSBURG, WEST VIRGINIA – Juwan Robert Woods, 32, of Philadelphia, Pennsylvania, was sentenced to 87 months in prison for his leadership role in a multi-state heroin and oxycodone trafficking operation, United States Attorney William J. Ihlenfeld, II, announced.
Woods was among 21 individuals charged in a 65-count federal indictment in November 2014. The indictment disrupted an extensive drug trafficking operation in which heroin and oxycodone were transported across state lines from Philadelphia, Pennsylvania to Morgantown, West Virginia for redistribution and sale throughout the region.
Woods pled guilty in April 2015 to a criminal Information charging him with one count of “Aiding and Abetting the Distribution of Oxycodone within 1000’ of Protected Location.” Specifically, Woods admitted that he distributed oxycodone near Wiles Hill playground in Monongalia County, West Virginia in May 2014.
Another participant in the trafficking operation, Terri Shuttlesworth, 25, of Fairmont, West Virginia was sentenced to 10 months in prison for selling oxycodone in Monongalia County in late 2013 and early 2014. He pled guilty in February 2015 to one count of “Distribution of Oxycodone.”
Assistant U.S. Attorney Zelda Wesley prosecuted the case on behalf of the government. The West Virginia State Police Bureau of Criminal Investigation, the Federal Bureau of Investigation, and the Mon Valley Drug and Violent Crime Task Force investigated.
U.S. District Judge Irene M. Keeley presided.
Las Cruces Man Sentenced to Federal Prison for Robbing First Light Federal Credit Union in Las Cruces in July 2013Read the Press Release
ALBUQUERQUE – Dominic Tyrel Holland, 28, of Las Cruces, N.M., was sentenced this morning to 40 months in federal prison followed by two years of supervised release for his bank robbery conviction.
Holland was arrested on July 31, 2013, on a criminal complaint charging him with robbing the First Light Federal Credit Union in Las Cruces on that day. He subsequently was indicted on that same charge. According to the criminal complaint, Holland approached a bank teller and presented a note demanding money. After obtaining money from the bank teller, Holland left the bank on foot. After witnesses at the bank identified Holland as the bank robber, officers of the Las Cruces Police Department located Holland at an apartment complex and placed him under arrest.
Holland pled guilty to the indictment on Oct. 31, 2013, and admitted robbing the First Light Federal Credit Union in Las Cruces N.M., on July 31, 2013. He entered his guilty plea without the benefit of a plea agreement.
The case was prosecuted by Assistant U.S. Attorney Luis A. Martinez of the U.S. Attorney’s Las Cruces Branch Office. It was investigated by the Las Cruces office of the FBI and the Las Cruces Police Department.
Kansas Man Sentenced to 20 Years in Prison in Plot to Explode Car Bomb at AirportRead the Press Release
Airport Worker Intended to Use his Access to Secure Areas to Commit Terrorist Attack
A Wichita, Kansas, man working as an avionic technician for an aeronautics company and possessing restricted access to secure airport areas, was sentenced to 20 years in federal prison today for attempting to explode a car bomb at the airport in Wichita, Assistant Attorney General for National Security John P. Carlin and U.S. Attorney Barry R. Grissom of the District of Kansas announced.
Terry Lee Loewen, 60, pleaded guilty on June 8 to one count of attempting to use a weapon of mass destruction. Loewen was arrested in December 2013 when he tried to enter the grounds of the Wichita Mid-Continent Airport for the purpose of exploding a bomb. (The airport was recently renamed the Wichita Dwight D. Eisenhower National Airport).
“Terry Loewen abused his privileged airport access to attempt to perpetrate a terrorist attack in Wichita,” said Assistant Attorney General Carlin. “The National Security Division’s highest priority is protecting the United States against terrorist threats. We will continue to pursue justice against those who seek to carry out violent attacks against Americans, whether at home or abroad.”
“Here in the heartland, terrorism will never shake our faith in the things this country stands for – freedom, fairness and opportunity,” said U.S. Attorney Grissom. “We won’t give way to those who would inflict violence on their fellow citizens.”
In his plea, Loewen admitted he came to the attention of the FBI late in May 2013 when he became a Facebook friend of a person who was posting comments advocating violent jihad. The FBI began communicating with Loewen through an undercover employee. After Loewen expressed his desire to engage in violent jihad, the undercover employee offered to introduce him to someone who could help him do it.
Loewen told the undercover employee he was waiting for what he called “the green light” from Allah to carry out a violent attack on a civilian target. He said that he did not expect to live through any of the attacks he had in mind. Loewen also said that he was inspired by the teachings of Osama bin Laden and Anwar Al Awlaki, and that he had downloaded thousands of pages of information on jihad.
In September 2013, Loewen sent photos of airplanes on the tarmac at the Wichita airport. He commented that he could have “walked over there, shot both pilots … slapped some C4 on both fuel trucks and set them off before anyone even called TSA.”
In October 2013, Loewen met with a second undercover FBI employee who Loewen believed was a “brother” and would help him blow up a plane. Loewen said that he had scouted the airport to determine a time and place for an attack that would be sure to kill as many people as possible.
Loewen assisted the second FBI employee in the final assembly of an improvised explosive device. He was not aware that the explosive materials used in the device were inert. In the early hours of Dec. 13, 2013, the second FBI employee picked up Loewen at a Wichita hotel. They drove to where the bomb was stored and finished wiring the device. When they reached the airport, Loewen used his badge twice at a card reader to attempt to get onto the tarmac before he was arrested.
Loewen was sentenced by Senior U.S. District Judge Monti L. Belot of the District of Kansas.
Assistant Attorney General Carlin and U.S. Attorney Grissom commended the Wichita FBI Joint Terrorism Task Force, which includes members from the FBI, the Sedgwick County, Kansas, Sheriff’s Office and Kansas Highway Patrol. Assisting with the investigation were the FBI Kansas City, Missouri, Division, the Transportation Security Administration, the Wichita Airport Authority and the Wichita Police Department. Assistant Attorney General Carlin and U.S. Attorney Grissom also commended the prosecutors on the case, Assistant U.S. Attorneys David Smith and Tony Mattivi of the District of Kansas and Trial Attorney Erin Creegan of the National Security Division’s Counterterrorism Section.
Kansas Man Sentenced in Plot to Explode Car Bomb at AirportRead the Press Release
WICHITA – A Wichita, Kansas, man working as an avionic technician for an aeronautics company and possessing restricted access to secure airport areas, was sentenced to 20 years in federal prison today for attempting to explode a car bomb at the airport in Wichita, U.S. Attorney Barry R. Grissom and Assistant Attorney General for National Security John P. Carlin announced.
Terry Lee Loewen, 60, pleaded guilty on June 8 to one count of attempting to use a weapon of mass destruction. Loewen was arrested in December 2013 when he tried to enter the grounds of the Wichita Mid-Continent Airport for the purpose of explodig a bomb. (The airport was recently renamed the Wichita Dwight D. Eisenhower National Airport).
“Here in the heartland, terrorism will never shake our faith in the things this country stands for – freedom, fairness and opportunity,” said U.S. Attorney Grissom. “We won’t give way to those who would inflict violence on their fellow citizens.”
“Terry Loewen abused his privileged airport access to attempt to perpetrate a terrorist attack in Wichita,” said Assistant Attorney General Carlin. “The National Security Division’s highest priority is protecting the United States against terrorist threats – both international and domestic. We will continue to pursue justice against those who seek to carry out violent attacks against Americans, whether at home or abroad.
In his plea, Loewen admitted he came to the attention of the FBI late in May 2013 when he became a Facebook friend of a person who was posting comments advocating violent jihad. The FBI began communicating with Loewen through an undercover employee. After Loewen expressed his desire to engage in violent jihad, the undercover employee offered to introduce him to someone who could help him do it.
Loewen told the undercover employee he was waiting for what he called “the green light” from Allah to carry out a violent attack on a civilian target. He said that he did not expect to live through any of the attacks he had in mind. Loewen also said that he was inspired by the teachings of Osama bin Laden and Anwar Al Awlaki, and that he had downloaded thousands of pages of information on jihad.
In September 2013, Loewen sent photos of airplanes on the tarmac at the Wichita airport. He commented that he could have “walked over there, shot both pilots … slapped some C4 on both fuel trucks and set them off before anyone even called TSA.”
In October 2013, Loewen met with a second undercover FBI employee who Loewen believed was a “brother” and would help him blow up a plane. Loewen said that he had scouted the airport to determine a time and place for an attack that would be sure to kill as many people as possible.
Loewen assisted the second FBI employee in the final assembly of an improvised explosive device. He was not aware that the explosive materials used in the device were inert. In the early hours of Dec. 13, 2013, the second FBI employee picked up Loewen at a Wichita hotel. They drove to where the bomb was stored and finished wiring the device. When they reached the airport, Loewen used his badge twice at a card reader to attempt to get onto the tarmac before he was arrested.
Loewen was sentenced by Senior U.S. District Judge Monti L. Belot of the District of Kansas.
Assistant Attorney General Carlin and U.S. Attorney Grissom commended the Wichita FBI Joint Terrorism Task Force, which includes members from the FBI, the Sedgwick County, Kansas, Sheriff’s Office and Kansas Highway Patrol. Assisting with the investigation were the FBI Kansas City, Missouri, Division, the Transportation Security Administration, the Wichita Airport Authority and the Wichita Police Department. Assistant Attorney General Carlin and U.S. Attorney Grissom also commended the prosecutors on the case, Assistant U.S. Attorneys David Smith and Tony Mattivi of the District of Kansas and Trial Attorney Erin Creegan of the National Security Division’s Counterterrorism Section.
Kansas City Man Pleads Guilty to Armed Bank RobberyRead the Press Release
KANSAS CITY, KAN. – A Kansas City man who pointed a gun in the face of a bank employee during a robbery in Overland Park pleaded guilty in federal court Monday, U.S. Attorney Barry Grissom said.
Landein Craddock, 33, Kansas City, Mo., pleaded guilty to one count of armed bank robbery. In his plea, he admitted that on Jan. 20, 2015, he displayed a revolver when he and another man robbed the Bank of the West at 9400 Antioch in Overland Park, Kan. Both robbers wore masks and gloves. Craddock shouted at employees and customers to get on the ground and he pointed a gun in the face of one of the bank employees, while the other man jumped the counter and collected money from tellers.
Shortly after the robbery, police spotted Craddock and the other man in a black Honda and pursued them until the driver crashed his car in Kansas City, Mo. Craddock fled on foot and was arrested about a block from the scene of the accident.
Sentencing will be set for a later time. Both parties have agreed to recommend a sentence of 20 years or less. Co-defendant Jerome Davis, 32, Kansas City, Mo., is scheduled for jury trial Dec. 7.
Grissom commended the Overland Park Police Department, the FBI and Assistant U.S. Attorney Scott Rask.
Justice Department Settles Housing Discrimination Lawsuit Against Owners of Marion, Illinois, Mobile Home ParkRead the Press Release
The Justice Department announced today that the owners and operators of the Williams Trailer Court mobile home park in Marion, Illinois, had agreed to pay $75,000 to settle allegations that they discriminated against African Americans and families with children, in violation of the federal Fair Housing Act. The settlement was approved today by the U. S. District Court for the Southern District of Illinois.
The settlement agreement resolves a lawsuit alleging that the owners and operators of the park, located at 200 East Patrick Street in Marion, Illinois, violated the Fair Housing Act by refusing to rent mobile homes to African Americans and families with children. The lawsuit is based on the results of testing conducted by the department’s fair housing testing program. Testing is a simulation of a housing transaction that compares responses given by housing providers to different types of home-seekers to determine whether illegal discrimination is occurring. The testing conducted by the department revealed that the manager and part owner of the park, Lyle Williams, falsely told African Americans inquiring about renting mobile homes that no homes were available, while telling white home-seekers that such mobile homes were available. The testing also revealed that Williams unlawfully discouraged families with children from living there. In addition to Lyle Williams, the lawsuit also names as defendants the park’s other two owners, Kyle Williams and David Williams.
“The right of people to live in the housing of their choice regardless of their race or whether they have children is fundamental,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division. “The Justice Department will continue its vigorous enforcement of the Fair Housing Act, which seeks to protect that right.”
“It is both shocking and sad that in this day and age any person would try to discriminate against a fellow citizen on the basis of race,” said U.S. Attorney Stephen R. Wigginton of the Southern District of Illinois. “Neither the Department of Justice nor my office will tolerate such behavior. Opportunity and justice must remain equal for all.”
Under the terms of the settlement, defendants will establish a settlement fund in the amount of $45,000 to compensate victims of the discriminatory practices. Defendants also will pay $30,000 in civil penalties to the United States. In addition, the agreement requires defendants to implement a nondiscrimination policy, establish new nondiscriminatory application and rental procedures, and undergo training on the Fair Housing Act. Persons who believe they may have been discriminated against at Williams Trailer Court should contact the department at 1-800-896-7743, extension 3, or by email at [email protected].
The federal 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 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.
Justice Department Settles Discrimination Claim Against Louisiana Crane & ConstructionRead the Press Release
The Justice Department announced today that it reached a settlement with Louisiana Crane & Construction LLC (Louisiana Crane), a crane and construction company headquartered in Eunice, Louisiana, that provides services to oilfields. The settlement resolves a lawsuit filed on Aug. 29, 2014, by the Office of Special Counsel for Immigration-Related Unfair Employment Practices (OSC).
The lawsuit alleged that from at least Jan. 1, 2013, until at least Sept. 1, 2013, Louisiana Crane required workers who are not U.S. citizens to produce documents issued by the Department of Homeland Security as a condition of employment, but it did not make similar demands of U.S. citizens. The anti-discrimination provision of the Immigration and Nationality Act (INA) prohibits employers from placing additional documentary burdens on workers during the employment eligibility verification process based on the worker’s citizenship status.
Under the settlement agreement, Louisiana Crane will pay $165,000 in civil penalties to the United States, establish a $50,000 back pay fund to compensate workers who lost wages because of the company’s practices, undergo monitoring for two years and train its employees on the INA’s anti-discrimination provision.
People who were authorized to work in the United States but were denied a job at Louisiana Crane, whose hire date was delayed by Louisiana Crane or were fired by Louisiana Crane between 2011 and 2015 because they could not show the documents the company requested to prove their work authorization, should contact OSC at (202) 305-0144. Any unclaimed money from the $50,000 back pay fund will be donated to a non-profit organization in Texas or Louisiana.
“We see far too many cases of employers creating discriminatory barriers for immigrants who have permission to work in the United States,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division. “It is important that all employers examine their employment policies to make sure they are treating all workers fairly.”
OSC is responsible for enforcing the anti-discrimination provision of the INA. Among other things, the statute prohibits citizenship status and national origin discrimination in hiring, firing or recruitment or referral for a fee; unfair documentary practices; retaliation; and intimidation. Trial Attorneys Liza Zamd and Silvia Dominguez-Reese and Paralegal Isabel Otero of the Civil Rights Division worked on this case.
For more information about protections against employment discrimination under immigration laws, call OSC’s worker hotline at 1-800-255-7688 (1-800-237-2515, TTY for hearing impaired); call OSC’s employer hotline at 1-800-255-8155 (1-800-237-2515, TTY for hearing impaired); sign up for a free webinar at www.justice.gov/crt/about/osc/webinars.php, email [email protected]; or visit OSC’s website at www.justice.gov/crt/about/osc.
Applicants or employees who believe they were subjected to different documentary requirements based on their citizenship status, immigration status or national origin; or discrimination based on their citizenship status, immigration status or national origin in hiring, firing, or recruitment or referral for a fee should contact OSC’s worker hotline for assistance.
Justice Department Asks Federal Court to Shut Down Fraudulent Mississippi Tax Return PreparerRead the Press Release
The United States filed a complaint seeking to permanently bar a Durant, Mississippi, woman and the tax preparation business she operates from preparing federal tax returns for others, the Justice Department announced today.
The civil complaint against Teresa Chism and her business, Lady T. Taxes, was filed in the U.S. District Court for the Southern District of Mississippi. The complaint alleges that Chism prepares income tax returns for customers that fraudulently overstate the refunds due by falsely claiming refundable credits, including the Earned Income Tax Credit (EITC) and credits for education expenses. The complaint further alleges that Chism frequently prepares a fabricated Internal Revenue Service (IRS) Form W-2, Wage and Tax Statement, to submit with a tax return in order to maximize the amount of EITC a customer claims.
According to the complaint, since 2010, Chism has prepared more than 2,845 tax returns, and audits of 220 returns uncovered a total of more than $1 million in tax credits that Chism’s customers were not entitled to claim.
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams for 2015. The IRS has some tips on its website for choosing a tax return preparer, and has launched a free directory of federal tax return preparers. In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers and tax scheme promoters. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Jury finds Texas man guilty of attempting to make a sexually explicit video of a child and persuading mother to allow sexual exploitation of the childRead the Press Release
LAKE CHARLES, La. – United States Attorney Stephanie A. Finley announced that a federal jury found a Texas man guilty late Friday of attempting to use a child to make a sexually explicit video and of persuading and convincing the mother to allow sexual exploitation of the child.
The jury found Mark Anthony Thompson, 49, of Richmond, Texas, guilty of one count of attempting to use a child to produce a visual depiction or production of child pornography and one count of attempting to entice a minor to engage in criminal sexual activity. United States District Judge Patricia Minaldi presided over the trial, which started Monday, August 24th, and ended late Friday, August 28th; the jury deliberated for approximately one hour. Evidence admitted at trial revealed that Thompson persuaded a Louisiana mother to use her child to unknowingly produce a sexually explicit video and tried to further sexually exploit the child. In December of 2013, the victim and her father found disturbing messages, pictures and a video from the defendant on his wife’s phone, and the father reported the matter to the DeRidder Police Department.
“It took courage for any victim to come forward under these circumstances,” Finley stated. “This young girl and her father are to be commended for assisting law enforcement in stopping this abuser. I want to encourage all victims of sexual abuse to speak up and know that there is help. You are not alone, and you are not at fault. I want to thank the prosecutors and the state, local and federal law enforcement officers who worked diligently to ensure that justice was served in this case. ”
“Child sexual abuse is one of the most heinous crimes HSI investigates as it steals the innocence of children and leaves lasting scars on victims,” said Raymond R. Parmer Jr., special agent in charge of HSI New Orleans. “Criminals who prey on children will continue to be one of the agency’s highest priorities in order to protect the innocent from these terrible crimes.”
Homeland Security Investigations, the DeRidder Police Department, Louisiana State Police and the Louisiana Department of Social Services conducted the investigation. Assistant U.S. Attorneys Myers P. Namie and John Luke Walker are prosecuting the case.
This case is part of Project Safe Childhood, a U.S. Department of Justice nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The U.S. Attorney’s Office and the U.S. Department of Homeland Security/Homeland Security Investigations/Immigration & Customs Enforcement (ICE) encourage the public to report suspected child predators and any suspicious activity through its toll-free hotline at (866) 347-2423. Investigators are available at all hours to answer hotline calls. Tips or other information can also be submitted to ICE online at www.ice.gov/exec/forms/hsi-tips/tips.asp. Tips may be reported anonymously.
Jury Convicts Two Ozark Men, California Man of Meth ConspiracyRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that two Ozark, Mo., men and a Los Angeles, Calif., man have been convicted in federal court of their roles in a conspiracy to distribute large amounts of methamphetamine in southwest Missouri.
Philip Delgrosso, 63, and Jeffrey A. Cain, 40, both of Ozark, and Cesar Ramon Avila-Hernandez, 28, of Los Angeles, were found guilty on Friday, Aug. 28, 2015, of participating in a conspiracy to distribute methamphetamine in Greene County, Christian County and Webster County from Sept. 4, 2012, to June 5, 2013.
In addition to the conspiracy, Delgrosso and Cain were found guilty of participating in a money-laundering conspiracy related to their sales of multiple vehicles to co-conspirators, who purchased the vehicles from them at Missouri Auto Group Motors, LLC with drug-trafficking proceeds. Delgrosso and Cain also were found guilty of one count of engaging in money laundering together, and each found guilty of an additional separate count of money laundering. Delgrosso was also convicted of one count of failing to file a federal currency transaction report after receiving more than $10,000 in a transaction. Avila-Hernandez was also found guilty of possessing methamphetamine with the intent to distribute.
Evidence submitted during the trial indicated that the conspiracy was receiving multi-pound quantities of methamphetamine from sources in Arizona and California for distribution in southwest Missouri. Conspirators used the proceeds of the drug-trafficking conspiracy to purchase numerous vehicles from Delgrosso and Cain at Missouri Auto Group.
For example, on April 7, 2013, co-defendant Jerry Dean Wright, Jr., 39, of Ozark, brought approximately $47,848 in cash to Missouri Auto and gave it to Delgrosso for the purchase of a 2010 Dodge Challenger and a 2010 Chevrolet Camaro. The money used to purchase the Challenger and the Camaro was derived from Wrights’ distribution of methamphetamine. Other vehicles purchased at Missouri Auto Group from the proceeds of the drug-trafficking conspiracy included a 1998 Jaguar, two 2003 Harley Davidson motorcycles, a 2004 Chevrolet SSR, a 2005 Pontiac GTO, a 2006 Chrysler 300C, a 2007 Chevrolet Avalanche, a 2008 Chevrolet Avalanche, two 2010 Chevrolet Camaros, a 2010 Dodge Challenger and a 2012 Chevrolet Camaro.
In October 2012, several co-defendants drove to Arizona, where they picked up 25 pounds of methamphetamine then returned to Springfield and delivered the methamphetamine to Wright. Wright also arranged for at least three other multi-pound shipments of methamphetamine to be sent to Missouri in a VW Beetle that was equipped with a hidden compartment. On April 11, 2013, the Texas Department of Public Safety stopped a BMW X5 in Amarillo, Texas. The vehicle, which was connected to Wright, was carrying approximately nine pounds of methamphetamine in a hidden compartment.
On June 5, 2013, law enforcement officers saw Avila-Hernandez get into a Mercedes that they had learned had just been used to deliver a large quantity of methamphetamine to Springfield. A co-defendant had driven the vehicle from California to Springfield, and Avila-Hernandez flew from California to meet several co-defendants in Springfield and deliver the methamphetamine to Wright for distribution in southwest Missouri.
Avila-Hernandez met several other people in a hotel parking lot, and with Avila-Hernandez driving the Mercedes and the other persons in two other vehicles, they left Springfield eastbound on U.S. Highway 60. They were stopped by law enforcement officers between the cities of Rogersville and Seymour. Officers searched the Mercedes and found approximately 10 pounds of methamphetamine.
On the same day, law enforcement officers executed a search warrant at Missouri Auto Group. Cain told federal agents that he met Wright a few months earlier, when Wright bought a blue Volkswagen from the Missouri Auto Group. Wright began working for the Missouri Auto Group soon thereafter. Cain also told federal agents that Delgrosso was the de facto owner of the Missouri Auto Group, but had a criminal history that prevented him from being the actual owner. Cain said Wright had purchased several vehicles through the Missouri Auto Group; Wright had personally paid Cain in cash to help him purchase vehicles.
Wright was sentenced on Nov. 18, 2014, to 20 years in federal prison without parole after pleading guilty to his role in the drug-trafficking conspiracy and to money laundering. Wright is among 12 co-defendants who have pleaded guilty in this case.
Following the presentation of evidence, the jury in the U.S. District Court in Springfield, Mo., deliberated for about three and a half hours before returning the guilty verdict to U.S. District Judge Beth Phillips, ending a trial that began Monday, Aug. 24, 2015.
Under federal statutes, Delgrosso, Cain and Avila-Hernandez are each subject to a mandatory minimum sentence of 10 years in federal prison without parole. Avila-Hernandez must also forfeit to the government a Cadillac Escalade and $5,700 that was seized by law enforcement officers. Sentencing hearings will be scheduled after the completion of presentence investigations by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorneys Timothy A. Garrison and Randall D. Eggert. It was investigated by the Springfield, Mo., Police Department, the U.S. Drug Enforcement Administration, IRS-Criminal Investigation, the Missouri State Highway Patrol, the Webster County, Mo., Sheriff’s Department and the Ozark, Mo., Police Department.
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 Ostby in Billings on August 28, 2015, and entering pleas of Not Guilty were:
- DONALD JOHN CHERRY, a 58-year-old resident of Miles City, appeared on charges of felon in possession of a firearm. If convicted of the charge contained in the indictment, CHERRY faces 10 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 and the Drug Enforcement Administration. PACER Case Reference. 15-96
- ASHLEY LORAINE COTY, a 28-year-old resident of Miles City, appeared on charges of conspiracy to possess with intent to distribute and to distribute methamphetamine and possession with intent to distribute methamphetamine. If convicted of the most serious charge contained in the indictment, COTY faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by the HIDTA Task Force. PACER Case Reference. 15-97
- RICHARD LEE GILBERT, a 30-year-old resident of Miles City, appeared on charges of conspiracy to possess with intent to distribute and to distribute methamphetamine and possession with intent to distribute methamphetamine. If convicted of the most serious charge contained in the indictment, GILBERT faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by the HIDTA Task Force. PACER Case Reference. 15-97
- DENISE KELLY MALLAK, a 47-year-old resident of Billings, 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, MALLAK faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by the Federal Bureau of Investigation. PACER Case Reference. 15-100
- BURHAN A. MALLAK, a 63-year-old resident of Billings, 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, MALLAK faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by the Federal Bureau of Investigation. PACER Case Reference. 15-100
Appearing before U.S. Magistrate Lynch in Missoula on August 27, 2015, and entering pleas of Not Guilty were:
- JUAN DOMINGO CONDE ROCHA, a 34-year-old resident of Missoula, appeared on charges of illegal reentry of a deported alien. If convicted of the charge contained in the indictment, CONDE ROCHA faces 20 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the Department of Homeland Security. PACER Case Reference. 15-20
- RYAN SCOT FRANFORTER, a 38-year-old resident of Helena, appeared on charges of conspiracy to possess with intent to distribute and to distribution of methamphetamine. If convicted of the most serious charge contained in the indictment, FRANKFORTER faces 20 years in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by the Federal Bureau of Investigation and the Missouri River Drug Task Force. PACER Case Reference. 15-11
Appearing before U.S. Magistrate Ostby in Billings on August 26, 2015, and entering pleas of Not Guilty were:
- JONI LYNN ADAMS, a 28-year-old resident of Crow Agency, appeared on charges of assault on a federal officer. If convicted of the charge contained in the indictment, ADAMS faces 20 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the Federal Bureau of Investigation. PACER Case Reference. 15-74
- KRISTINA FERN CLEOELA SEELY, a 36-year-old resident of Hardin, appeared on charges of conspiracy to distribute methamphetamine and distribution of methamphetamine. If convicted of the most serious charge contained in the indictment, SEELY faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by the Bureau of Indian Affairs. PACER Case Reference. 15-103
Appearing before U.S. Magistrate Johnston in Great Falls on August 26, 2015, and entering pleas of Not Guilty were:
- DAVID QUINN GRAINGER, a 39-year-old resident of Poplar, appeared on charges of conspiracy to possess with intent to distribute methamphetamine, possession with intent to distribute methamphetamine, and distribution of methamphetamine. If convicted of the most serious charges contained in the indictment, GRAINGER faces 40 years in prison, $5,000,000 in fines and 5 years supervised release. The case was investigated by the Bureau of Indian Affairs and Fort Peck Tribes Department of Law and Justice. PACER Case Reference. 15-48
- LIONEL LEE WEEKS, a 50-year-old resident of Wolf Point, appeared on charges of conspiracy to distribute methamphetamine, possession with intent to distribute methamphetamine, and use of a communication facility in causing and facilitating the commission of felonies under the controlled substances act. If convicted of the most serious charges contained in the indictment, WEEKS faces life in prison, $250,000,000 in fines and 5 years supervised release. The case was investigated by the Bureau of Indian Affairs and Roosevelt County Sheriff’s Office. PACER Case Reference. 15-50
Appearing before U.S. Magistrate Johnston in Great Falls on August 25, 2015, and entering pleas of Not Guilty were:
- JAMES ANTONIO AMATO, a 50-year-old resident of Great Falls, appeared on charges of conspiracy to possess with intent to distribute and to distribute methamphetamine and possession with intent to distribute methamphetamine. If convicted of the most serious charge contained in the indictment, AMATO faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by the Drug Enforcement Administration. PACER Case Reference. 15-46
- 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 and possession with intent to distribute methamphetamine. If convicted of the most serious charge contained in the indictment, BUMMER faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by the Drug Enforcement Administration. PACER Case Reference. 15-46
- SHAD JAMES HUSTON, a 40-year-old resident of Havre, appeared on charges of false claims act conspiracy and false and fraudulent claims against a federally funded project. If convicted of the most serious charge contained in the indictment, HUSTON faces 10 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the U.S. Department of Interior Office of Inspector General, U.S. Department of Health and Human Services Office of Inspector General, Internal Revenue Service and the Federal Bureau of Investigation. PACER Case Reference. 15-42
- BILLI ANNE RAINING BIRD MORSETTE, a 39-year-old resident of Box Elder, appeared on charges of conspiracy to embezzle tribal funds and embezzlement from an Indian tribal organization. If convicted of the most serious charge contained in the indictment, MORSETTE faces 5 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the U.S. Department of Interior Office of Inspector General, U.S. Department of Health and Human Services Office of Inspector General, Internal Revenue Service and the Federal Bureau of Investigation. PACER Case Reference. 15-40
- NEAL PAUL ROSETTE, a 53-year-old resident of Box Elder, appeared on charges of conspiracy to embezzle tribal funds and embezzlement from an Indian tribal organization. If convicted of the most serious charge contained in the indictment, ROSETTE faces 5 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the U.S. Department of Interior Office of Inspector General, U.S. Department of Health and Human Services Office of Inspector General, Internal Revenue Service and the Federal Bureau of Investigation. PACER Case Reference. 15-40
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
Information Technology Manager Pleads Guilty to Sending Damaging Computer Code to Former Company’s ServersRead the Press Release
A former information technology manager pleaded guilty today to sending damaging computer code to servers at his former employer, a software company, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Thomas G. Walker of the Eastern District of North Carolina and Special Agent in Charge John A. Strong of the FBI’s Charlotte, North Carolina, Division.
Nikhil Nilesh Shah, 33, of Union, New Jersey, pleaded guilty before U.S. Magistrate Judge Robert T. Numbers II of the Eastern District of North Carolina, to one felony count of causing the transmission of computer code and, as a result, damaging computers and causing loss of at least $5,000 in value. Shah is scheduled to be sentenced in Dec. 8, 2015.
According to the indictment, from 2007 to March 2012, Shah was an information technology manager at Smart Online Inc., a company located in Durham, North Carolina, that developed platforms for the creation of mobile applications. Shah subsequently left Smart Online to work for another technology company. According to facts presented to the court in connection with his plea agreement, on June 28, 2012, Shah sent malicious computer code to Smart Online’s computer servers in Durham and Raleigh, North Carolina, causing at least $5,000 in damage and deleting much of Smart Online’s intellectual property.
The case was investigated by the FBI’s Raleigh, North Carolina, Field Office. The case is being prosecuted by Senior Trial Attorney Richard D. Green of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorneys Thomas B. Murphy and Adam Hulbig of the U.S. Attorney’s Office of the Eastern District of North Carolina.
Information Technology Manager Pleads Guilty to Sending Damaging Computer Code to Former Company’s ServersRead the Press Release
WASHINGTON – A former information technology manager pleaded guilty today to sending damaging computer code to servers at his former employer, a software company, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Thomas G. Walker of the Eastern District of North Carolina and Special Agent in Charge John A. Strong of the FBI’s Charlotte, North Carolina, Division.
Nikhil Nilesh Shah, 33, of Union, New Jersey, pleaded guilty before U.S. Magistrate Judge Robert T. Numbers II of the Eastern District of North Carolina, to one felony count of causing the transmission of computer code and, as a result, damaging computers and causing loss of at least $5,000 in value. Shah is scheduled to be sentenced on December 8, 2015.
According to the indictment, from 2007 to March 2012, Shah was an information technology manager at Smart Online Inc., a company located in Durham, North Carolina, that developed platforms for the creation of mobile applications. Shah subsequently left Smart Online to work for another technology company. According to facts presented to the court in connection with his plea agreement, on June 28, 2012, Shah sent malicious computer code to Smart Online’s computer servers in Durham and Raleigh, North Carolina, causing at least $5,000 in damage and deleting much of Smart Online’s intellectual property.
The case was investigated by the FBI’s Raleigh, North Carolina, Field Office. The case is being prosecuted by Senior Trial Attorney Richard D. Green of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorneys Thomas B. Murphy and Adam Hulbig of the U.S. Attorney’s Office of the Eastern District of North Carolina.
Idaho Falls/St. Anthony Woman Sentenced for Investment Fraud SchemeRead the Press Release
POCATELLO – Lois Davis, 60, of Idaho Falls, Idaho, and formerly of St. Anthony, Idaho, was sentenced today to 46 months in prison, followed by three years of supervised release for wire fraud, U.S. Attorney Wendy J. Olson announced. Senior U.S. District Judge Edward J. Lodge also ordered Davis so pay $2,000,500 in restitution and serve 100 hours of community service. Davis was indicted by a federal grand jury on October 15, 2014.
Davis owned and operated Rouge River Financial and Y4 Ranch, based primarily in St. Anthony, Idaho. Davis held herself out as a person engaged in the business of investing and investment products, and with access to investment transactions from which she would receive substantial commissions. From August 2007, to July 2010, Davis devised and orchestrated an investment scheme whereby she enticed investors to send money to her based upon Davis’ materially false representations that the investors would be entitled to a portion of a commission that Davis would earn on a financial transaction. Davis sometimes referred to these investment opportunities as a “comm-buy.” For most investors she provided, or caused to be provided, a Sales and Purchase Agreement, which falsely represented to investors that they would receive up to ten times their initial investment.
Davis willfully failed to disclose material facts relevant to potential investors, including: that during the time frame of the scheme she had not received a commission of the kind described in the Sales and Purchase Agreements; she had no legitimate basis to expect to receive a commission in the future; prior investors had not received the promised returns; and that investor funds would be used for Davis’ personal expenses. Additionally, Davis often represented or implied that she was connected to, licensed by, or working with government agencies, such as the “Fed,” “Federal Secretary of State,” and the “Treasury Department,” which was not true.
To at least one investor victim, Davis provided a fraudulent copy of her bank balance, showing assets of over $19 million, when in fact the accounts contained less than $100. She also emailed, or caused to be emailed, a fraudulent recommendation letter from a purported “Gary DuPont” falsely claiming that Davis had earned over $100 million in commissions and made 396 people millionaires.
During the time period described, Davis received from investors approximately $2.1 million, she refunded to investors approximately $330,000, and kept approximately $1.8 million in fraudulently obtained funds. During the time frame of the scheme, Davis did not earn a commission of the type described in the Sales and Purchase Agreements. Instead, she spent investors’ funds on personal items, such as vehicles, horses, and tack, and on gifts to her family and her church.
The case was investigated by the Federal Bureau of Investigation.
Huntington man pleads guilty to federal oxycodone chargeRead the Press Release
HUNTINGTON, W.Va. – A Huntington man who possessed and sold oxycodone in 2013 pleaded guilty today to a federal drug charge, announced U.S. Attorney Booth Goodwin. Tracey Lee Gibson, 36, entered a guilty plea in federal court in Huntington to possession with intent to distribute oxycodone.
On March 26, 2013, agents with the Drug Enforcement Administration executed a search warrant at Gibson’s residence at 1608 Madison Avenue in Huntington. During the search, agents recovered 43 oxycodone pills that Gibson intended to sell. Prior to the search, Gibson assisted in the sale of oxycodone to a DEA confidential informant on three occasions in February and March of 2013.
Gibson faces up to 20 years in federal prison, and is scheduled to be sentenced on November 30, 2015.
The Drug Enforcement Administration conducted the investigation. Assistant United States Attorney Joseph F. Adams is in charge of 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 U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
Former Silk Road Task Force Agent Pleads Guilty to Money Laundering and ObstructionRead the Press Release
Ex-Secret Service Agent Used Status to Pocket $820,000 Worth of Bitcoin
A former U.S. Secret Service special agent pleaded guilty today to money laundering and obstruction of justice in connection with his theft of digital currency during the federal investigation of Silk Road, an online marketplace used to facilitate the purchase and sale of illegal drugs and other contraband.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Melinda Haag of the Northern District of California, Chief Richard Weber of the IRS-Criminal Investigation (IRS-CI), Special Agent in Charge David J. Johnson of the FBI’s San Francisco Division, Special Agent in Charge Michael P. Tompkins of the Justice Department’s Office of the Inspector General’s Washington, D.C. Field Office, and Special Agent in Charge Lori Hazenstab of the Department of Homeland Security’s Office of the Inspector General in Washington D.C. made the announcement.
Shaun W. Bridges, 32, of Laurel, Maryland, had been a special agent with the U.S. Secret Service for approximately six years in the Baltimore Field Office and was assigned to the Electronic Crimes Task Force. He pleaded guilty before the U.S. District Judge Richard Seeborg of the Northern District of California and a sentencing hearing is scheduled for Dec. 7, 2015.
“There is a bright line between enforcing the law and breaking it,” said Assistant Attorney General Caldwell. “Law enforcement officers who cross that line not only harm their immediate victims but also betray the public trust. This case shows we will act quickly to hold wrongdoers accountable, no matter who they are.”
“Mr. Bridges has now admitted that he brazenly stole $820,000 worth of digital currency while working as a U.S. Secret Service special agent, a move that completely violated the public’s trust,” said U.S. Attorney Haag. “We depend on those in federal law enforcement having the highest integrity and unshakeable honor, and Mr. Bridges has demonstrated that he utterly lacks those qualities. We appreciate the hard work of our federal partners that went into bringing Mr. Bridges to justice.”
“Through a series of complex transactions, the defendant stole bitcoins worth hundreds of thousands of dollars,” said Chief Weber. “This case is an excellent example of the financial expertise of our special agents. Through the analysis of both the block chain and data from the Silk Road servers, we were able to trace the flow of funds, which eventually led to the defendant.”
Between 2012 and 2014, Bridges was assigned to the Baltimore Silk Road Task Force, a multi-agency group investigating illegal activity on Silk Road. Bridges’ responsibilities included, among other things, conducting forensic computer investigations in an effort to locate, identify and prosecute targets, including Ross Ulbricht, aka Dread Pirate Roberts, who ran Silk Road.
According to his plea agreement, Bridges admitted that in January 2013 he used an administrator account on the Silk Road website that belonged to another individual to fraudulently obtain access to that website, reset passwords of various accounts and to move bitcoin from those accounts into a bitcoin “wallet” that Bridges controlled. Bridges admitted that he moved and stole approximately 20,000 bitcoin, which at that time was worth approximately $350,000.
Bridges admitted that he moved the stolen bitcoin into an account at Mt. Gox, an online digital currency exchange based in Japan. According to his admissions, he liquidated the bitcoin into $820,000 of U.S. currency between March and May 2013, and had the funds transferred to personal investment accounts in the United States.
Bridges’ plea agreement also established that he obstructed the Baltimore federal grand jury’s investigations of Silk Road and Ulbricht in a number of ways, including by impeding the ability of the investigation to fully utilize a cooperator’s access to Silk Road. In addition, Bridges admitted that he made multiple false and misleading statements to investigators in connection with the San Francisco federal grand jury’s investigation into his own illegal acts, and that he encouraged another government employee to lie to investigators.
Bridges is one of two federal agents to plead guilty in connection with illegal activity during the investigation of Silk Road. Carl M. Force, 46, of Baltimore, was a special agent with the Drug Enforcement Administration and was also assigned to the Baltimore Silk Road Task Force. On July 1, 2015, Force pleaded guilty to a three-count information charging him with money laundering related to his theft of over $700,000 in digital currency while acting as an undercover agent on the Task Force. Force is scheduled to be sentenced by Judge Seeborg on Oct. 19, 2015.
The case was investigated by the FBI’s San Francisco Division, the IRS-CI’s San Francisco Division, the Justice Department’s Office of the Inspector General and the Department of Homeland Security’s Office of the Inspector General in Washington, D.C. The case is being prosecuted by Assistant U.S. Attorneys Kathryn Haun and William Frentzen of the Northern District of California and Trial Attorney Richard B. Evans of the Criminal Division’s Public Integrity Section, with assistance from Assistant U.S. Attorney Arvon Perteet.
Former Secret Service Agent Pleads Guilty to Money Laundering and ObstructionRead the Press Release
SAN FRANCISCO – Shaun W. Bridges pleaded guilty today to money laundering and obstruction of justice in connection with his position as an agent with the U.S. Secret Service announced U.S. Attorney Melinda Haag, Assistant Attorney General Leslie Caldwell, IRS Criminal Investigation Chief Richard Weber, FBI Special Agent in Charge David J. Johnson, IRS Criminal Investigation Special Agent in Charge José M. Martinez, Department of Justice Inspector General Special Agent in Charge Michael P. Tompkins and Department of Homeland Security Inspector General Special Agent in Charge Lori Hazenstab. The plea marks the end of a major portion of the investigation into the Silk Road, an underground black market that allowed vendors and buyers to conduct illegal transactions over the internet.
Bridges, 32, of Laurel, Maryland was a Special Agent with the U.S. Secret Service and was assigned to the Baltimore Silk Road Task Force, a multi-agency team investigating illegal activity on the Silk Road. Among the targets of the Task Force was Ross Ulbricht, a/k/a “Dread Pirate Roberts,” who was prosecuted for his involvement with the Silk Road.
In the plea agreement filed today, Bridges admitted he used an administrator account to reset passwords and pins of various accounts on the Silk Road. This enabled Bridges to move bitcoin into a “wallet” he controlled and which he used to fraudulently move and steal approximately 20,000 bitcoin from Silk Road accounts. At the time Bridges stole the bitcoin in January 2013, 20,000 bitcoin would have been worth approximately $350,000. Shortly after Bridges stole the bitcoin, he moved it into an account at Mt. Gox, an online digital currency exchange based in Japan. Between March and May of 2013, he liquidated the bitcoin into $820,000 of U.S. currency and had the funds transferred to the United States to a personal investment account at Fidelity. He owned the Fidelity account under the name of Quantum International Investments, LLC. Later, in June 2014, Bridges transferred money from the Quantum Fidelity account into a personal bank account that he shared with another person.
On June 16, 2015, Bridges was charged by information with money laundering, in violation of 18 U.S.C. § 1956, and obstruction of justice, in violation of 18 U.S.C. § 1512. In today’s plea agreement, Bridges pleaded guilty to both charges. In connection with his guilty plea, Bridges acknowledged his actions compromised a District of Maryland grand jury investigation into Ulbricht and the Silk Road. Bridges also acknowledged he made multiple false and misleading statements to both prosecutors and investigators in connection with an investigation being conducted by a San Francisco grand jury. In addition, Bridges tried to get other government employees to tell false stories to prosecutors and investigators. In his agreement with the government, Bridges agreed his sentence for money laundering will include enhancements for abuse of trust and obstruction of justice.
“Mr. Bridges has now admitted that he brazenly stole $820,000 worth of digital currency while working as a U.S. Secret Service special agent, a move that completely violated the public’s trust,” said U.S. Attorney Melinda Haag. “We depend on those in federal law enforcement having the highest integrity and unshakeable honor, and Mr. Bridges has demonstrated that he utterly lacks those qualities. We appreciate the hard work of our federal partners that went into bringing Mr. Bridges to justice.”
“There is a bright line between enforcing the law and breaking it,” said Assistant Attorney General Caldwell. “Law enforcement officers who cross that line not only harm their immediate victims but also betray the public trust. This case shows we will act quickly to hold wrongdoers accountable, no matter who they are.”
“Through a series of complex transactions, the defendant stole bitcoins worth hundreds of thousands of dollars," said Richard Weber, Chief, IRS-Criminal Investigation. "This case is an excellent example of the financial expertise of our special agents. Through the analysis of both the block chain and data from the Silk Road servers, we were able to trace the flow of funds, which eventually led to the defendant.”
Bridges’ sentencing is scheduled for December 7, 2015, before the Honorable Richard Seeborg, United States District Judge in San Francisco. The maximum penalty for each count in the information is 20 years and $250,000, but any sentence following conviction would be imposed after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence.
Bridges is one of two federal agents to be charged with illegal activity in connection with the investigation into the Silk Road. Carl M. Force, 46, of Baltimore, Maryland, was a Special Agent with the DEA who also was assigned to the Baltimore Silk Road Task Force. On July 1, 2015, Force pleaded guilty to a three-count information charging him with money laundering with predicates of wire fraud and theft of government property, in violation of 18 U.S.C. § 1956(a)(1)(A) and (B); obstruction of justice, in violation of 18 U.S.C. § 1512(c)(2); and extortion under color of official right, in violation of 18 U.S.C. § 1951, related to his theft and diversion of over $700,000 in digital currency to which he gained control as part of undercover role on the Baltimore Silk Road Task Force. Force is scheduled to be sentenced by Judge Seeborg on October 19, 2015.
The case is being prosecuted by Assistant U.S. Attorneys Kathryn Haun and William Frentzen of the Northern District of California and Trial Attorney Richard B. Evans of the Criminal Division’s Public Integrity Section. Assistant U.S. Attorney Arvon Perteet assisted with Asset Forfeiture aspects of the case. The attorneys were assisted by Daniel Charlier-Smith, Lance Libatique, and Christine Tian. The case was investigated by the FBI’s San Francisco Division, the IRS-CI’s San Francisco Division, the Department of Justice Office of the Inspector General, and the Department of Homeland Security Office of the Inspector General in Washington D.C. Additional assistance was provided by IRS Criminal Investigation – New York Field Office, HSI’s Chicago/O’Hare Division, the U.S. Attorney’s Office for the Southern District of New York, the Department of Justice’s Computer Crime and Intellectual Property Section, the U.S. Embassy in Slovenia, the Financial Crimes Enforcement Network, the International Organized Crime Center IOC-2, and the FBI Legal Attaché Office in Tokyo, Japan.