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Friday 21 August 2015
Canadian Companies Fined $45 Million and Ordered to Forfeit an Additional $30 Million for Smuggling Misbranded Pharmaceuticals into the United StatesRead the Press Release
ALEXANDRIA, Va. – SB Medical Inc., and TC Medical Group, companies based in Toronto, Canada, and St. Michael, Barbados, were fined $45 million and required to forfeit another $30 million for orchestrating a multi-year conspiracy to smuggle misbranded prescription pharmaceuticals into the United States. During the conspiracy, SB Medical Inc. and TC Medical Group received over $33 million in proceeds from selling misbranded prescription pharmaceuticals to U.S. doctors and clinics.
SB Medical, Inc. and TC Medical Group pleaded guilty on May 7, 2015. According to court documents, from at least 2011 through 2014, the companies smuggled orthopedic injections, rheumatology infusions, cosmetic devices, optomology products, and oncology drugs into the United States. The non-FDA approved prescription pharmaceuticals were sourced from other foreign countries, including India, Turkey, France, Italy, and other countries. The pharmaceuticals included Lucentis, Mabthera, Botox, Dysport, Euflexxa, Remicade, Restylane, Synvisc, Prolia, Orencia, Orthovisc, and other products.
Members of the conspiracy working for SB Medical Inc. and TC Medical Group used false names to sell the pharmaceutical products throughout the United States. To smuggle pharmaceuticals across the U.S. border, large shipments were broken down into multiple small shipments. Those shipments were sent to addresses in Maryland, New Jersey, Florida, and other locations under different false names over several days. Customs forms falsely stated the contents and value of the shipments. Drop shippers in the United States received these packages, removed indicia that they were from abroad, and re-shipped them to doctors and clinics in the United States so that packages would have a United States-based return address. These drop shippers stored the drugs and medical devices in the basements of their private residences, often in violation of safety regulations requiring the pharmaceuticals to be stored at cool temperatures.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; George M. Karavetsos, Director, FDA Office of Criminal Investigations; Clark E. Settles, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Washington; and David G. Bowers, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service, made the announcement after the sentence was imposed by U.S. District Judge Anthony J. Trenga.
This case was investigated by the FDA’s Office of Criminal Investigations, ICE-HSI, and the U.S. Postal Inspection Service. Assistant U.S. Attorneys Kellen S. Dwyer and Jay V. Prabhu are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:14-cr-397.
California Man Pleads Guilty to the Sale of Horns from a Black RhinocerosRead the Press Release
Lumsden W. Quan, 47, an art dealer from San Francisco, California, pleaded guilty today to conspiracy to violate the Lacey and Endangered Species Act and to a violation of the Lacey Act for knowingly selling black rhinoceros horns to an undercover agent from the U.S. Fish and Wildlife Service (USFWS). His co-defendant, Edward N. Levine, charged in the indictment remains scheduled for trial on Oct. 19, 2015, in Las Vegas, Nevada.
The guilty plea was announced by Assistant Attorney General John C. Cruden for the Department of Justice’s Environment and Natural Resources Division, U.S. Attorney Daniel G. Bogden for the District of Nevada and Director Dan Ashe for USFWS.
Quan pleaded guilty before the Honorable Chief Judge Gloria M. Navarro in U.S. District Court in Las Vegas, Nevada, to all charges in the indictment. He is scheduled to be sentenced on Dec. 3, 2015. Quan was identified as part of “Operation Crash,” a nationwide effort led by the USFWS and the Justice Department to investigate and prosecute those involved in the black market trade of rhinoceros horns and other protected species.
Quan admitted in federal court to conspiring with co-defendant Levine to sell two black rhinoceros horns to an undercover agent posing as a Colorado wildlife collector. Quan stated that he and Levine arranged to have the horns transported to Las Vegas, where on March 19, 2014, Quan sold them to the agent for $55,000. Quan faces a maximum sentence of five-years imprisonment.
The black rhinoceros is an herbivore species of prehistoric origin and one of the largest remaining mega-fauna on earth. They have no known predators other than humans. All species of rhinoceros are protected under U.S. and international law, including the Endangered Species Act. Since 1976, trade in rhinoceros horn has been regulated under the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), a treaty signed by over 170 countries around the world to protect fish, wildlife and plants that are or may become imperiled due to the demands of international markets.
The investigation is continuing and is being handled by the USFWS’s Office of Law Enforcement, the U.S. Attorney’s Office for the District of Nevada and the Justice Department’s Environmental Crimes Section. The government is represented by Trial Attorneys Jennifer Blackwell and Ryan Connors, Assistant U.S. Attorney Kathryn Newman, and paralegal Amanda Backer.
Businessman charged for trying to bribe East Cleveland councilmanRead the Press Release
An East Cleveland businessman was charged for attempting to bribe a councilman in that city in exchange for support in getting a liquor license, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the Cleveland Office of the Federal Bureau of Investigation.
Mukundkumar Patel, 52, was charged in a criminal information with one count of bribery concerning programs receiving federal funds.
“This councilman acted as we expect all public officials would and immediately reported a bribe offer to the FBI, who did great work following up,” Dettelbach said. “The lesson of this case is simple: ‘briber beware.’”
“We will not tolerate individuals believing they can circumvent the law by bribing a public official,” Anthony said. “The FBI commends the public official involved for adhering to his ethical principles by not accepting the bribe made by this business owner.”
Patel began renovating the former bar area of McCalls into a Convenient Food Mart which would sell beer and wine. Doing so would require a liquor license, which requires a written application endorsed by the city of East Cleveland, according to the information.
Patel submitted a liquor license application. City officials told Patel they were not inclined to endorse his application but would consider his request after speaking with community stakeholders, according to the information.
On October 15, 2014, Patel met with an East Cleveland councilman, identified in the charges only as Public Official 1, and offered to pay $2,000 if the councilman would sign the application. The councilman refused and Patel raised his offer to $3,000. The councilman again refused and Patel told the councilman to name his price, according to the information.
Unbeknownst to Patel, the councilman contacted the FBI to report the bribe solicitation. On Oct. 23, 2014, Patel again met with the councilman, who was acting at the FBI’s direction. Patel offered the councilman $4,000 up front and $1,000 later in return for signing Patel’s beer and wine application, according to the information.
The next day, Patel and the councilman met again and Patel paid him $4,000 in cash. The councilman turned the money over to the FBI, according to the information.
This case is being prosecuted by Assistant U.S. Attorney Antoinette T. Bacon following an investigation by the FBI.
If convicted, the defendant’s sentence will be determined by the court after a review of the federal sentencing guidelines and factors unique to the case, including the defendant’s prior criminal record (if any), the defendant’s role in the offense and the characteristics of the violation.
A charge 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.
Broward Man Charged in Federal Court for Using a Means of Interstate Commerce to Attempt to Entice a Mother and Her Minor Daughters to Engage in IncestRead the Press Release
Broward man charged in federal court for using a means of interstate commerce to attempt to entice a mother and her minor daughters to engage in incest
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Dave Aronberg, State Attorney, Palm Beach County, George Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office and Rick Bradsaw, Sheriff, Palm Beach County Sheriff’s Office (PBSO), made the announcement.
Aaron J. Fink, 44, of Deerfield Beach, has been charged by a criminal complaint with using the internet to attempt to entice a mother and her two minor children to engage in illegal sexual activity. Fink is presently in state custody at the Palm Beach County jail and is expected to appear for Initial Appearance in two weeks before a United States Magistrate Judge upon which the government will seek his detention. If convicted, the defendant faces a 10 year mandatory term of imprisonment and a maximum term of life.
Between June 29, 2015, and August 13, 2015, Fink sent numerous sexually explicit messages via a public website, e-mail and text messages to an undercover officer who posed as the single mother of two minor daughters, 8 and 12 years old. As alleged in the criminal complaint, Fink discussed his desire to have sexual intercourse with the mother and both children as part of an incestuous relationship. Fink’s desires culminated on August 13, 2015, when he drove to West Palm Beach in an attempt to meet the mother and her children to engage in illegal sexual activity. PBSO intercepted Fink and he was arrested. Fink later confessed to sending sexually explicit messages to the mother, whom he did not know was an undercover officer. Fink also admitted that he traveled to West Palm Beach to meet the mother and minor children to “possibly” engage in sexual activity with them.
This case was adopted from state prosecution in cooperation with the Palm Beach County State Attorney’s Office and the South Florida ICAC. This case was also brought into federal court as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Project Safe Childhood was launched in May 2006 by the Department of Justice and is led by United States Attorney’s Offices and the Criminal Division’ Child Exploitation and Obscenity Section (CEOS). Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The case is being prosecuted by Assistant U.S. Attorney Adam McMichael and Special Assistant U.S. Attorney Gregory Schiller from the Palm Beach State Attorney’s Office.
A complaint is only an accusation and a defendant is presumed innocent unless and until proven guilty.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Thursday 20 August 2015
Wasilla Man Indicted for Child Exploitation CrimeRead the Press Release
Anchorage, Alaska – United States Attorney Karen L. Loeffler announced today that a federal grand jury returned a two-count indictment against Justin Raymond Nekeferoff, 27, of Wasilla, Alaska, charging him with attempted sexual exploitation of a child – coercion and enticement of a minor.
According to court documents, between June 8, 2015, and July 22, 2015, Nekeferoff, using a facility and means of interstate and foreign commerce, did knowingly attempt to persuade, induce, entice, and coerce an individual who he believed had not attained the age of 18 years, to engage in any sexual activity for which any person can be charged with a criminal offense, to wit: Sexual Abuse of a Minor in the First Degree, in violation of Alaska Statute 11.41.434(a)(1).
The case was the product of an investigation by the Federal Bureau of Investigation. Assistant U.S. Attorney Audrey J. Renschen is prosecuting the case.
If convicted of attempted sexual exploitation of a child – coercion and enticement of a minor, Nekeferoff faces a statutory penalty of not less than 10 years and up to life imprisonment. The count also carries a fine of up to $250,000, as well as the possibility of a life time period of supervised release following any sentence of imprisonment. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
This prosecution is part of the Department of Justice’s ongoing Project Safe Childhood initiative which was launched to increase federal prosecutions of sexual predators of children, and to reduce the number of Internet crimes against children including child pornography trafficking. As a part of PSC, the United States Attorney’s Office has teamed with state and local agencies and organizations to increase law enforcement presence on the Internet, and to educate the public about safe Internet use, thereby reducing the risk that children might fall prey to online sexual predators. For additional information on the PSC initiative, please go to www.projectsafechildhood.gov or call the United States Attorney’s Office for the District of Alaska.
Washington Resident Sentenced to 10 Years for Drug Trafficking, Possession of A Firearm in Furtherance of A Drug Trafficking Crime, and Being A Felon in Possession of A FirearmRead the Press Release
Anchorage, Alaska B U.S. Attorney Karen L. Loeffler announced today that a former Washington resident was sentenced to 120 months of imprisonment for drug trafficking, possession of a firearm in furtherance of a drug trafficking crime, and being a felon in possession of a firearm.
Layten Scott Banchero, 29, a resident of Seattle, Washington, was sentenced Monday by U.S. District Court Judge Timothy M. Burgess in Juneau to 120 months of imprisonment followed by a five year term of supervised release. On April 6, 2015, Banchero pled guilty to a drug trafficking conspiracy, possession of a firearm in furtherance of a drug trafficking crime, and being a felon in possession of a firearm.
According to Assistant U.S. Attorney Jack Schmidt, who prosecuted the case, on or about May 11, 2014, Banchero entered into a drug trafficking conspiracy with other co-conspirators to bring methamphetamine and heroin from the lower 48 to Ketchikan, Alaska using various transportation methods. On June 13, 2014, Ketchikan Police were investigating another individual for a drug offense which subsequently led them to Banchero, who was residing in a local hotel room. During that contact, officers obtained a search warrant for Banchero’s room. Banchero was found to be in possession of 83.71 grams of actual methamphetamine and 30.1 grams of heroin, drug ledgers, a large amount of U.S. currency, and a loaded .357 magnum pistol. Banchero has a number of felony convictions from Washington and is prohibited from possessing firearms. During the investigation, it was discovered that Banchero had secured a local storage locker and law enforcement executed several warrants at that location. Officer’s discovered a number of other firearms and $24,000 in U.S. currency. Law enforcement seized a total of $38,533 in U.S. currency that was obtained from the sale of drugs and was forfeited as part of Banchero’s plea, along with the firearms seized from his storage locker and his room.
In sentencing Banchero, Judge Burgess noted the seriousness of the crime, the extensive criminal history of the defendant, deterrence of the defendant and others, and a need to protect the public as the reasons for sentence he imposed.
Ms. Loeffler commended the Drug Enforcement Administration, Ketchikan Police Department, and the Alaska State Troopers who conducted the investigation leading to the successful prosecution in this case.
Violent Drug Dealer Sentenced to Life ImprisonmentRead the Press Release
BATON ROUGE, LA - United States Attorney Walt Green announced that United States District Court Judge Shelly D. Dick sentenced JEFFREY D. PERRY, age 32, of Baton Rouge, Louisiana, yesterday to serve life imprisonment, followed by a prison term of fifteen years. Judge Dick also ordered PERRY to forfeit drug trafficking related proceeds of up to $10,505,205.
Following a multi-week jury trial in September 2014, PERRY was convicted of conspiring to distribute cocaine and “crack” cocaine, distributing cocaine and “crack” cocaine, car-jacking, possessing firearms in furtherance of crimes of violence and drug trafficking crimes, and possessing firearms while a convicted felon.
During yesterday’s sentencing, the Court found that PERRY made his living trafficking drugs and that he did whatever it took to protect his drug trafficking enterprise. As an example of his danger to the community, the Court noted that reliable evidence suggested that PERRY had hired an individual and two young men to set an elderly man’s house on fire. These two young men died later that day as a result of burns they sustained from the arson they had committed. During sentencing, the Court noted PERRY’s cold-blooded and callous statements about one of the arsonists, as he lay dying in his backyard, seeking medical assistance for the injuries he sustained from the fire PERRY had hired him to set.
Evidence at trial showed that, from August 2006 until September 2011, PERRY led a drug-trafficking endeavor within Baton Rouge operating largely on Evergreen Street, Louisiana Street, and Delphine Street, which distributed kilogram and multi-ounce amounts of cocaine and “crack” cocaine. Customers used cash, stolen equipment, firearms, and food stamps to purchase in those locations varying amounts of cocaine and “crack” cocaine from PERRY. He used “crack” addicts to test the quality of the “crack” he cooked before selling it to others.
As the Court found, PERRY often used violence. As another example, evidence at trial showed that PERRY solicited the assistance of Mark Allen to rob another individual who had been supplying him with kilogram amounts of cocaine. A few days after this robbery, PERRY enlisted Allen’s assistance to rob one of his customers of approximately $80,000. During this robbery, Allen shot and wounded the customer and car-jacked him. After Allen met PERRY and handed the cash he had taken during the armed robbery over to PERRY, the latter rewarded Allen, whom he then knew to be a convicted felon, with an ounce of “crack” cocaine and a Taurus .40 caliber semi-automatic pistol to protect himself against any reprisals the victim or his friends might take as a result of the robbery Allen had committed.
Other Defendants
- On August 31, 2011, following trial, a jury convicted Donald Frank of conspiracy to distribute cocaine for conduct arising from his drug trafficking endeavors, on behalf of PERRY. On March 6, 2012, he was sentenced to serve a time of life imprisonment by United States District Judge James J. Brady.
- On June 16, 2015, Judge Dick sentenced Jermaine Chapman who, along with PERRY, had also been convicted of drug trafficking and firearm related violations at trial, to a forty-five year term of imprisonment.
- On June 18, 2015, Judge Dick sentenced Charles Boyer who, along with PERRY and Chapman, had also been convicted at trial of conspiracy to commit drug trafficking, to a ten year term of imprisonment.
U.S. Attorney Green stated: “Justice has been served and a community has been freed from a violent menace. The defendant has brutalized and victimized neighborhoods for years while growing a drug trafficking empire responsible for the distribution of over $10 million worth of cocaine into our community. His culture of violence and drugs undermined all those struggling to raise children without those influences. Given the defendant’s past and present misconduct, I believe Judge Dick’s sentence of life imprisonment is entirely appropriate. I am extremely proud and grateful of the prosecutors and agents whose dedication and hard work have made our community safer.”
DEA Assistant Special Agent-in-Charge Joseph W. Shepherd stated, “Perry and his cohorts, through violence, intimidation, and domestic drug trafficking attempted to hold this community hostage. This life sentence is a resounding statement to the citizens of the Greater Baton Rouge area from DEA and the rest of our law enforcement partners that enough is enough. For those contemplating a life of crime and drug dealing in our community, let this be a warning to you.”
This matter was prosecuted by Assistant United States Attorney Robert W. Piedrahita, who serves as Litigation Counsel within the United States Attorney’s Office, and Assistant United States Attorney Chris Dippel, who serves as a Deputy Criminal Chief. This matter was investigated by the Drug Enforcement Administration (DEA) and the Baton Rouge City Police, with valuable assistance from the Louisiana State Police, the Louisiana State Police Crime Lab, and the Jefferson County (Texas) Sheriff’s Office.
Veterans Affairs Official Pleads Guilty to Accepting Gifts in Relation to His Job DutiesRead the Press Release
SACRAMENTO, Calif. —Anthony Castaneda, 45, resident of Oakdale, pled guilty today before Judge Morrison C. England Jr. to Receipt of a Gratuity by a Public Official, United States Attorney Benjamin B. Wagner announced.
According to court documents, while working as a contracting official at the Department of Veterans Affairs, Castaneda was in a position to influence the award of construction contracts at VA facilities, including the VA hospital at the former Mather Field in Sacramento. In 2010, a construction contractor provided Castaneda with a prepaid vacation package at a theme park worth approximately $2,243.56. Castaneda and his family traveled to the theme park for five days in October 2010. At the time that he accepted that gift, Castaneda was in a position to influence the award of construction contracts by making recommendations about which contractors should be given VA business. Court records also show that Castaneda received a second vacation package from the same contractor, worth approximately $1,439, in 2008.
The contractor in question has been charged separately in federal court in San Jose: United States v. Herrera, case number 5:14-cr-219.
This case was the product of an investigation by the Veterans Affairs Office of Inspector General and the Federal Bureau of Investigation. Assistant United States Attorney Matthew G. Morris is prosecuting the case.
Castaneda faces a maximum statutory penalty of two years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. A conviction can also result in Castaneda being debarred from being awarded government procurement contracts in the future for up to five years.
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United States Files Complaint Seeking Receivership, Injunction and Money Judgment Against Venture Capital CompanyRead the Press Release
PHILADELPHIA - A civil complaint and consent decree were filed yesterday on behalf of the U.S. Small Business Administration (SBA) against Murex Investments I, L.P., a limited partnership in Philadelphia, PA, announced United States Attorney Zane David Memeger. The complaint alleges that Murex entered into an agreement with the SBA, wherein the SBA provided Leverage to Murex through the guarantee of debentures with a face value of $8.25 million. Under the terms of that agreement, Murex was prohibited from exceeding a certain level of Capital Impairment and the complaint alleges that Murex has violated that level. At the time of the violation, $3.4 million of the debentures remained outstanding.
The consent decree provides for the appointment of the SBA as Receiver of Murex for the purpose of marshaling and liquidating Murex’s assets and satisfying the claims of its creditors. It also provides for a money judgment in the amount of $2,588,850.54 plus interest from the date of the entry of judgment.
The case was referred by SBA counsel Arlene M. Embrey and is being handled by Assistant United States Attorney Richard M. Bernstein.
U.S. Attorney Pamela Cothran Marsh Announces ResignationRead the Press Release
TALLAHASSEE, FLORIDA – Pamela Cothran Marsh announced her resignation today as United States Attorney for the Northern District of Florida, effective September 4, 2015. Since 2010, U.S. Attorney Marsh has served as the leading federal prosecutor for Florida’s 23 panhandle counties, from Alachua to Escambia, overseeing offices in Gainesville, Tallahassee, Panama City, and Pensacola.
“For more than five years as United States Attorney for the Northern District of Florida, Pamela Cothran Marsh has worked tirelessly to protect and empower the people of her community,” said Attorney General Loretta Lynch. “The skills, integrity, and passion that Pam has brought to the job each and every day have advanced the cause of justice on a variety of important fronts, from human trafficking to public corruption to law enforcement officer safety. Pam’s remarkable record of service reflects her immense talent as an advocate, her consummate professionalism as a leader, and her unwavering commitment to the pursuit of justice. From our earliest days together on the Attorney General’s Advisory Committee, I have always admired Pam’s dedication to the mission of this Department, to the high ideals of public service, and to the timeless principles that make our nation exceptional. I thank her for her extraordinary work as United States Attorney, and I look forward to all that she will continue to achieve in the next phase of her already distinguished career.”
“It was a tremendous honor to be appointed by President Barack Obama as United States Attorney, and it has been my great privilege to lead this office for the last five and a half years,” said U.S. Attorney Marsh. “I have loved working for Justice since my first day on the job. The lawyers and staff are incredibly talented and work hard every day in the name of justice, fairness, and equality. I would like to express my deep thanks to the President, the two wonderful Attorneys General with whom I worked – Eric H. Holder, Jr., and Loretta Lynch – and to Senators Nelson and Rubio for the confidence they placed in me. I will be forever grateful for the opportunities I have had as United States Attorney to protect our communities in the Northern District of Florida.”
On June 25, 2010, following President Obama’s nomination and the U.S. Senate’s confirmation, U.S. Attorney Marsh became the district’s 40th U.S. Attorney, and the first woman to serve in this position for the Northern District of Florida
Over the past five years, the Northern District of Florida has prosecuted a variety of cases related to tax and BP oil spill fraud, drug trafficking, sexual exploitation of minors, health care fraud, mortgage fraud, and civil rights violations, including:
- In 2012, seven individuals were sentenced in Tallahassee for conspiring to file more than 350 fraudulent income tax returns, seeking more than $2.4 million in tax refunds.
- In 2012 and 2013, as part of “Operation See Change”, nine individuals were sentenced in Tallahassee after a six-month undercover investigation targeting street-level drug distribution along Tallahassee’s Alabama Street corridor.
- In 2013, as part of the Project Safe Childhood initiative, a Georgia man was sentenced in Gainesville to 235 months in prison for attempted sexual exploitation of a minor via the Internet.
- In 2014, nine individuals were sentenced in Pensacola for filing fraudulent BP oil spill claims.
- In 2014, a California woman was sentenced to seven years in federal prison for her role in a $16 million mortgage fraud scheme involving properties in Navarre, Santa Rosa Beach, and Panama City. She was ordered to pay over $10 million in restitution to the victims of the fraud.
- In 2014, a Freeport physician was sentenced to 30 years in prison on charges that included health care fraud violations and illegally distributing controlled substances.
- In 2015, a former Gadsden County Deputy Sheriff’s Captain was sentenced in Tallahassee to 30 months in prison for violating the civil rights of an arrestee.
During her tenure, in addition to criminal prosecution, U.S. Attorney Marsh’s priorities have included outreach in human trafficking, reentry, violent crime prevention, and law enforcement officer safety.
U.S. Attorney Marsh created and chaired the Big Bend Coalition Against Human Trafficking, which has contributed to an increase in both human trafficking awareness and prosecutions. In a 2014 Panama City case, a human trafficker received life in prison for kidnapping and transporting a victim to Mississippi for prostitution.
Through the Big Bend After Reentry Coalition, U.S. Attorney Marsh’s office has joined other government agencies and non-profit groups in North Florida to assist offenders upon their release from incarceration, by providing support during their transitions into our communities.
U.S. Attorney Marsh has hosted law enforcement training sessions and recently co-produced an officer safety training video for officers responding to violent encounters.
Also, in a unique case, U.S. Attorney Marsh personally led a successful civil case to return a renaissance painting taken from the rightful owners, a Jewish family living in France, during World War II. The painting, known as the Cristo Portacroce by Romanino, was seized from an exhibit of paintings on loan from the Italian state museum in Milan, Italy.
After U.S. Attorney Marsh’s departure, First Assistant U.S. Attorney Christopher P. Canova will serve as Acting U.S. Attorney for the Northern District of Florida.
The United States Attorney's Office for the Northern District of Florida is one of 94 offices that serve as the nation’s principal litigators under the direction of the Attorney General. The office strives to protect and serve the citizens of the Northern District of Florida through the ethical, vigorous, and impartial enforcement of the laws of the United States, to defend the national security, to improve the safety and quality of life in our communities through the protection of civil rights, and to protect the public funds and financial assets of the United States. To access public court documents online, please visit the U.S. District Court for the Northern District of Florida website. For more information about the United States Attorney’s Office, Northern District of Florida, visit http://www.justice.gov/usao/fln/index.html.
For more information, contact:
Amy Alexander, Public Information Officer
(850) 216-3854, [email protected]
Two Swiss Banks Reach Resolutions under Justice Department's Swiss Bank ProgramRead the Press Release
The Department of Justice announced today that bank zweiplus ag (Bank Zweiplus) and Banca dello Stato del Cantone Ticino (Banca Stato) have reached resolutions under the department’s Swiss Bank Program.
“Swiss banks continue to accept responsibility for their involvement in the concealment of foreign assets and the evasion of tax by U.S. accountholders,” said Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division. “The banks are paying penalties, making necessary reforms and providing information and cooperation that are enabling the department to hold accountable those individuals that facilitated this misconduct.”
The Swiss Bank Program, which was announced on Aug. 29, 2013, provides a path for Swiss banks to resolve potential criminal liabilities in the United States. Swiss banks eligible to enter the program were required to advise the department by Dec. 31, 2013, that they had reason to believe that they had committed tax-related criminal offenses in connection with undeclared U.S.-related accounts. Banks already under criminal investigation related to their Swiss-banking activities and all individuals were expressly excluded from the program.
Under the program, banks are required to:
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Make a complete disclosure of their cross-border activities;
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Provide detailed information on an account-by-account basis for accounts in which U.S. taxpayers have a direct or indirect interest;
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Cooperate in treaty requests for account information;
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Provide detailed information as to other banks that transferred funds into secret accounts or that accepted funds when secret accounts were closed;
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Agree to close accounts of accountholders who fail to come into compliance with U.S. reporting obligations; and
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Pay appropriate penalties.
Swiss banks meeting all of the above requirements are eligible for a non-prosecution agreement.
According to the terms of the non-prosecution agreements signed today, each bank agrees to cooperate in any related criminal or civil proceedings, demonstrate its implementation of controls to stop misconduct involving undeclared U.S. accounts and pay penalties in return for the department’s agreement not to prosecute these banks for tax-related criminal offenses.
Bank Zweiplus was founded in July 2008 as a retail bank based in Zurich. Offices located in Geneva and Basel, Switzerland, were closed in 2008 and 2012, respectively. Since Aug. 1, 2008, Bank Zweiplus maintained and serviced 44 U.S.-related accounts with an aggregate value of approximately $12.1 million.
Bank Zweiplus was aware that U.S. taxpayers have a legal duty to report to the Internal Revenue Service (IRS) their ownership of bank accounts outside the United States and to pay taxes on income earned in such accounts. Nevertheless, in disregard of U.S. laws, the bank provided a variety of traditional Swiss banking services that assisted some U.S. taxpayers in concealing their undeclared accounts. For example, Bank Zweiplus maintained numbered accounts and accounts held in the name of structures which were effectively owned or controlled by U.S. persons, including structures in the British Virgin Islands and the Bahamas.
Bank Zweiplus cooperated with the department during its participation in the Swiss Bank Program and encouraged its U.S. clients to enter the IRS Offshore Voluntary Disclosure Program. Bank Zweiplus will pay a penalty of $1.089 million.
Banca Stato was established in 1915 and is headquartered in Bellinzona, Switzerland. Banca Stato was aware that U.S. taxpayers had a legal duty to report to the IRS and pay taxes on the basis of all of their income, including income earned in accounts that the U.S. taxpayers maintained at the bank. Despite this, the bank opened and serviced accounts for U.S. clients who the bank knew or had reason to know were not complying with their U.S. income tax obligations.
In 2001, Banca Stato entered into a Qualified Intermediary Agreement with the IRS. In 2001, the bank issued an internal directive prohibiting U.S. persons without a Form W-9 on file with the bank from buying U.S. securities. However, prior to 2011, Banca Stato’s relationship managers were not instructed to, and did not, evaluate or screen incoming U.S. clients for U.S. tax compliance status. At that time, more than 70 percent of the assets under management were related to U.S. accountholders who had not provided a Form W-9 to the bank.
In 2011, Banca Stato implemented a project that it called “Colombo” to change the manner in which it handled U.S. clients. The bank recognized both risks and rewards of handling U.S. clients. As to the former, the bank recognized that “[w]e can no longer have clients who are U.S. Persons who have not signed the W-9 form.” But the bank also recognized an opportunity to attract new U.S. clients because many Swiss banks declined to service U.S. persons from Ticino, Switzerland, and the bank perceived “a huge demand from fully tax-compliant U.S. Persons . . . attracted by the brand BancaStato (especially because we have no branches in the US).”
Banca Stato entered into a relationship with a Lugano-based U.S. Securities and Exchange-registered investment advisory firm to partner in attracting U.S. persons living and working in the Ticino region who could not open or maintain accounts at other institutions. The bank paid the firm a one-time finder’s fee of 0.5 percent on the incoming funds. Despite the bank’s decision to refuse to open new accounts of U.S. persons without a Form W-9, it did not always adhere to this policy.
Banca Stato offered a variety of traditional Swiss banking services that it knew would and in certain instances did assist U.S. clients in concealing assets and income from the IRS, including hold mail and code name or numbered accounts. In addition, the bank employed a variety of other means or conduct that it knew or should have known would assist U.S. taxpayers in concealing their Banca Stato accounts, including opening accounts for U.S. taxpayers who left other banks being investigated by the department and allowing U.S. clients to direct repeated wire transfers between $9,000 and $9,900 in an effort to conceal their Swiss bank accounts from U.S. authorities.
During the applicable period, Banca Stato maintained and serviced 187 U.S.-related accounts with an aggregate maximum balance of approximately $137 million. Banca Stato will pay a penalty of $3.393 million.
In accordance with the terms of the Swiss Bank Program, each bank mitigated its penalty by encouraging U.S. accountholders to come into compliance with their U.S. tax and disclosure obligations. While U.S. accountholders at these banks who have not yet declared their accounts to the IRS may still be eligible to participate in the IRS Offshore Voluntary Disclosure Program, the price of such disclosure has increased.
Most U.S. taxpayers who enter the IRS Offshore Voluntary Disclosure Program to resolve undeclared offshore accounts will pay a penalty equal to 27.5 percent of the high value of the accounts. On Aug. 4, 2014, the IRS increased the penalty to 50 percent if, at the time the taxpayer initiated their disclosure, either a foreign financial institution at which the taxpayer had an account or a facilitator who helped the taxpayer establish or maintain an offshore arrangement had been publicly identified as being under investigation, the recipient of a John Doe summons or cooperating with a government investigation, including the execution of a deferred prosecution agreement or non-prosecution agreement. With today’s announcement of these non-prosecution agreements, noncompliant U.S. accountholders at these banks must now pay that 50 percent penalty to the IRS if they wish to enter the IRS Offshore Voluntary Disclosure Program.
“The vigorous pursuit of unreported income in hidden offshore accounts is one of our top priorities,” said Chief Richard Weber of IRS-Criminal Investigation (CI). “Through our coordinated efforts with the Department of Justice, we now have significantly more information about the institutions and individuals involved in offshore tax evasion. The public should be on notice that we will continue to use all tools at our disposal to stop this abuse and protect the American taxpayer.”
Acting Assistant Attorney General Ciraolo thanked the IRS, and in particular, IRS-CI and the IRS Large Business and International Division for their substantial assistance. Ciraolo also thanked John E. Sullivan, Thomas G. Voracek and Mark Kotila, who served as counsel on these matters, as well as Senior Counsel for International Tax Matters and Coordinator of the Swiss Bank Program Thomas J. Sawyer and Senior Litigation Counsel Nanette L. Davis of the Tax Division.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
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Two Sentenced in Methamphetamine Trafficking ConspiracyRead the Press Release
ABILENE, Texas — Two defendants, Ceddrick Lamont Johnson, a/k/a “Bunny Cool,” of Abilene, Texas, and Stephanie McQueen, of Sweetwater, Texas, who pleaded guilty to their roles in a methamphetamine trafficking conspiracy have been sentenced, announced U.S. Attorney John Parker of the Northern District of Texas.
Today, McQueen, 25, was sentenced by U.S. District Judge Jorge A. Solis to 60 months in federal prison. Yesterday, Judge Solis sentenced Johnson, 38, as a career offender to 240 months in federal prison. Each pleaded guilty in April 2015 to one count of conspiracy to distribute and to possess with the intent to distribute 50 grams or more of methamphetamine.
According to the factual resumes filed in the case, special agents with the FBI and investigators with the Nolan County District Attorney’s Office began an investigation in 2013 into the distribution of methamphetamine in the Sweetwater, Texas, area. McQueen was identified as a distributor. When McQueen was stopped for traffic violations in August 2014, officers located a small quantity of methamphetamine in the vehicle. In a subsequent interview, she identified a person she knew as “Bunny Cool,” (Johnson) as one of her supply sources for the methamphetamine she distributed in Sweetwater. She indicated she was introduced to Johnson in 2013 and that he fronted her methamphetamine for approximately nine months. She purchased one ounce of methamphetamine every other day.
On September 25, 2014, McQueen texted Johnson and negotiated the purchase of methamphetamine. Johnson subsequently distributed 4.3 grams of methamphetamine to McQueeen. He was arrested on September 26, 2014, and text messages from his phone showed a pattern of drug trafficking. On October 3, 2014, law enforcement agents purchased methamphetamine from McQueen and another person in Sweetwater.
The FBI and the Nolan County District Attorney’s Office investigated. Assistant U.S. Attorney Juanita Fielden prosecuted.
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Two Anakyuvuk Pass Women Indicted for Theft of Postal Funds and PropertyRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that two women from Anaktuvuk Pass were separately indicted by a federal grand jury in Anchorage for multiple counts of Misappropriation of Postal Funds.
According to Assistant U.S. Attorney Bryan Schroder, Dorothy Gordon was indicted on 23 counts related to theft of deposits from the Anaktuvuk Pass Post Office, as well as theft of cash on delivery (COD) funds. The total amount of theft charged for Gordon is over $70,000. Bernice Hart was charged in a separate indictment on 45 counts related to theft of deposits, theft of COD funds, and theft of money orders. The total amount of theft charged for Hart is over $40,000.
The charge of Misappropriation of Postal Funds carries a maximum sentence of five years imprisonment, or a fine of $250,000, or both. Under the federal sentencing statutes, the actual sentence imposed will be based upon the seriousness of the offense(s) and the prior criminal history, if any, of the defendant.
Ms. Loeffler commends the U.S. Postal Service, Office of Inspector General for the investigation of this case. According to Joanne Yarbrough, Special Agent in Charge for the Western Area Field Office of the United States Postal Service Office of Inspector General, the vast majority of Postal Service employees are hardworking professional individuals dedicated to the furtherance of Postal Service operations. However, when employees violate the public trust, as alleged in this case, OIG agents will investigate those individuals aggressively and seek prosecution to the fullest extent of the law.
An indictment is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
Suitland Woman Pleads Guilty to Stealing over $115,000 in Social Security Retirement BenefitsRead the Press Release
Greenbelt, Maryland – Theresa Darlene Snead, age 56, of Suitland, Maryland pleaded guilty today to theft of government property in connection with a scheme to steal over $115,000 in social security benefits.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Michael McGill of the Social Security Administration - Office of Inspector General, Philadelphia Field Division.
According to Snead’s plea agreement, between May 1986 and her death on January 10, 2003, Individual A received monthly retirement benefits from the Social Security Administration (SSA). At the time of her death, Individual A was living with Snead. Individual A’s death was not reported to SSA. Between January 2003 and March 2014, when the benefits were terminated, SSA continued to mail Individual A’s monthly benefits check to Snead’s address in Suitland.
Snead admitted that after Individual A’s death she cashed the SSA checks at a local liquor store, using an identification card bearing Individual A’s name, but Snead’s photograph. Snead signed the back of each check in Individual A’s name. SSA paid a total of $115,388 in retirement benefits after Individual A’s death. Snead admitted that she knew she was not entitled to these benefits.
Snead and the government have agreed that if the Court accepts the plea agreement Snead will be sentenced to 18 months in prison. U.S. District Judge Deborah K. Chasanow has scheduled sentencing for November 10, 2015 at 2:30 p.m.
United States Attorney Rod J. Rosenstein commended the SSA Office of Inspector General for its work in the investigation. Mr. Rosenstein thanked Special Assistant U.S. Attorney Lauren Perry and Assistant U. S. Attorney Lindsay Eyler Kaplan, who are prosecuting the case.
Springfield Man Indicted on Federal Firearms and Drug ChargesRead the Press Release
BOSTON – Robert Crichlow, 37, was indicted in U.S. District Court in Springfield on one count of being a convicted felon in possession of a firearm and ammunition and one count of possession with intent to distribute crack cocaine.
The indictment alleges that, on June 4, 2015, Crichlow possessed a Taurus Model PT 145 .45 caliber pistol and seven rounds of .45 caliber ammunition. He also possessed eight rocks of crack cocaine packaged for sale.
For those who qualify as armed career criminals, the charge of being a felon in possession of a firearm provides a mandatory minimum sentence of 15 years and a maximum of a lifetime in prison, five years of supervised release, and a fine of $250,000. The charge of possessing crack cocaine with intent to distribute provides a sentence of no greater than 20 years in prison, up to life of supervised release, and a fine of $1 million. 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 Daniel J. Kumor, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms & Explosives, Boston Field Division, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Katharine A. Wagner of Ortiz’s Springfield Branch Office.
The details contained in the indictment are allegations. The defendant is presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Smuggling Boss and Two Others Head to Prison in Alien Smuggling ConspiracyRead the Press Release
CORPUS CHRISTI, Texas – A total of three people have been ordered to federal prison for their roles related to a conspiracy to harbor and transport illegal aliens, announced U.S. Attorney Kenneth Magidson.
Homero Gonzalez-Carranza, 30, a citizen of Mexico who resided in Houston, pleaded guilty to being a boss in the conspiracy which existed from January 2007 until January 2015. Eduardo Luis Pompa, 26, also of Houston, was convicted June 11, 2015, following a two-day trial and only 45 minutes of deliberations. Also sentenced today was co-conspirator Lisa Quintanilla, 46, of Premont, who had previously pleaded guilty.
Today, Senior U.S. District Judge Hayden Head handed Gonzalez-Carranza a 151-month sentence. Not a U.S. citizen, he is expected to face deportation proceedings upon his release from federal prison. Pompa received a sentence of 63 months, while Quintanilla was sentenced to 34 months.
Gonzalez-Carranza oversaw the transportation of illegal aliens from the Rio Grande Valley to Houston. Illegal aliens would be harbored at stash houses in Houston until ultimately being transported to their final destinations within the United States. During the conspiracy, illegal aliens suffered injuries during transport, such as during high speed chases and vehicles crashes.
In one instance, 115 illegal aliens were discovered in a house in Houston on March 19, 2014. They were held against their will at the stash house which was about 1400 square feet with boarded up windows and doors.
During Pompa’s trial, which involved the testimony of 15 government witnesses, evidence established that Pompa served as a scout for the alien smuggling organization. In that role, he would drive ahead of or behind vehicles transporting illegal aliens to look for law enforcement. Pompa served in this capacity from early 2014 until July 14, 2014, when he was arrested with nine other conspirators transporting 57 aliens to Houston.
Quintanilla also served as a scout for the alien smuggling organization and did so from January 2014 to June 2014. Lucia Mendez, 35, of Pasadena, who previously pleaded guilty, also worked for the alien smuggling organization. She provided vehicles that were used by other members of the organization to transport illegal aliens and served in this role during 2014. Mendez is scheduled to be sentenced Sept. 29, 2015. Mendez, Pompa, and Quintanilla worked for Gonzalez-Carranza.
Additionally, evidence also established that this criminal organization transported multiple loads of illegal aliens on a weekly and even daily basis. On one occasion - April 23, 2014 - a load driver for the organization was arrested transporting five illegal aliens near Premont. That driver attempted to flee, traveling in excess of 100 miles per hour and finally crashing into a tree, causing serious bodily injuries to the aliens. Quintanilla served as a scout for this particular load. The evidence also established that Pompa was working as a scout that same day, but for another load of transported aliens.
It is estimated that thousands of illegal aliens were transported and harbored during this conspiracy.
Gonzalez-Carranza and Pompa will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future. Quintanilla will remain on bond pending her designation to a U.S. Bureau of Prisons facility, also to be determined in the near future.
The case was investigated by Homeland Security Investigations and Border Patrol as part of the South Texas Campaign. Assistant U.S. Attorney Chad W. Cowan is prosecuting the case.
Schickell Best Sentenced to 51 Months ImprisonmentRead the Press Release
HAMMOND – United States Attorney for the Northern District of Indiana, David Capp, announced today that Schickell Best, 27, of Gary, Indiana was sentenced to 51 months imprisonment and 2 years of supervised release by District Court Judge James Moody after pleading guilty to being a felon in possession of a firearm.
According to documents filed in this case, on September 28, 2013, Best was arrested by law enforcement at the a bar in Gary, Indiana after being observed standing outside the bar as it was closing in possession of a loaded Norinco model SKS semi-automatic rifle. Best had prior felony convictions including one for Battery on Law Enforcement.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives with assistance from the Gary Police Department. The case was prosecuted by Assistant United States Attorney Thomas M. McGrath.
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San Antonio Man Sentenced to Federal Prison on Child Pornography ChargesRead the Press Release
In San Antonio today, 40-year-old Gabriel Espinoza of San Antonio, TX, was sentenced to the statutory maximum of 30 years in federal prison for production of child pornography announced United States Attorney Richard L. Durbin, Jr., and Homeland Security Investigations (HSI) Special Agent in Charge James Spero, San Antonio Division.
In addition to the prison term, United States District Judge Orlando Garcia ordered that Espinoza be placed on supervised release for 40 years after completing his prison term.
On February 3, 2015, Espinoza pleaded guilty to one count of production of child pornography. By pleading guilty, Espinoza admitted that on or about May 2011 he coerced a minor to engage in sexually explicit conduct for the purpose of producing a visual depiction. Espinoza then distributed images of the victim through the internet.
“The heavy sentence imposed on Espinoza sends a clear message that there are serious consequences for those who exploit children in anyway,” stated Special Agent in Charge, James Spero, HSI San Antonio. “Targeting crimes of this nature is a high priority for HSI. We will continue to dedicate HSI resources nationwide to identify and bring to justice these individuals."
This case was investigated by HSI. Assistant United States Attorney Tracy Thompson prosecuted this case on behalf of the Government.
Sacramento Man Sentenced to More Than Eleven Years in Prison for Child Pornography OffenseRead the Press Release
SACRAMENTO, Calif. —Robert M. Schaefer, 68, of Sacramento, was sentenced today by Chief United States District Judge Morrison C. England Jr. to eleven years and four months in prison for two counts of possession of child pornography, United States Attorney Benjamin B. Wagner announced.
According to court documents, from 2001 to 2010, Schaefer uploaded thousands of images of children being sexually exploited, including children under 10, to various file‑sharing websites. He would surf the Internet looking for people seeking particular types of photos, which he would then supply from his extensive collection. His computers were seized once by the Sacramento Police Department in 2006, but Schaefer rebuilt his pornography collection and began collecting and sharing the materials again. The FBI seized his computers again on 2010 after the German Federal Police provided a tip that Schaefer had recently been uploading child pornography to a file-sharing site in Germany.
In sentencing the defendant, Chief Judge England noted that the volume of the defendant’s collection of child pornography was “astronomical” and that he had served as a niche supplier of child pornography to people seeking particular types of images from all over the world. Because of these facts, Chief Judge England ordered that the defendant serve ten years, the maximum allowable under the law, for his offense of possessing child pornography in 2010, to be followed consecutively by 16 additional months for his offense of possessing child pornography in 2006, for a total sentence of 136 months in prison. Upon release from prison, the defendant will be required to spend the remainder of his life under the supervision of a United States probation officer, and will be required to register as a sex offender.
This case is the product of an investigation by the Federal Bureau of Investigation, the Sacramento Internet Crimes against Children Task Force, and the Sacramento Police Department. Assistant United States Attorneys Matthew G. Morris and Brian A. Fogerty are prosecuting the case.
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 those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about Internet safety education.
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Ringleader in Check and Credit Card Fraud Schemes Sentenced to over 5 Years in Federal PrisonRead the Press Release
Baltimore, Maryland – U.S. District Judge Richard D. Bennett sentenced Egwolo Wilfred Otete, age 31, of formerly of Jacksonville, Florida and Beltsville, Maryland today, to 61 months in federal prison, followed by two years of supervised release, for check and credit card fraud schemes with over 250 victims and losses of more than $468,000. Otete has already served nearly 41 months in Florida state prison in connection with the schemes. Judge Bennett also ordered Otete to pay restitution of $468,534.42, the amount of the victims’ actual losses. Otete was ordered to be surrendered to immigration authorities for deportation after the service of his federal sentence.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Brian Murphy of the United States Secret Service - Baltimore Field Office; Chief J. Thomas Manger of the Montgomery County Police Department; and Chief James W. Johnson of the Baltimore County Police Department.
According to his plea agreement, from September 3, 2010 through March 1, 2011, Otete conspired with co-defendants Jimoh Babatunde Aderomilehin, Olaniyi Olalekan Akintuyi, Moyosore Fakeye, Obinna Stanley Okpala, and others, to execute a scheme to defraud financial institutions by depositing counterfeit checks into accounts at financial institutions and withdrawing the funds before the checks were returned as fraudulent.
Shortly after Otete arrived in the United States to attend college, he met Oluwaseun Sanya at a nightclub. Soon, Otete became deeply involved in both the check fraud scheme and a counterfeit credit card scheme, and moved in with Sanya. Their apartment became a central point where counterfeit checks and credit cards were produced and distributed, and fraud proceeds delivered.
In the counterfeit check scheme, Otete and others recruited students and others to allow the group to use their bank accounts to deposit counterfeit checks. Otete also recruited bank employees to obtain account and personal information about bank customers, which he and Sanya used to create the counterfeit checks to be deposited into the students’ compromised accounts. Once counterfeit checks were deposited, funds were withdrawn before the counterfeit checks could be identified as fraudulent and the deposits reversed. Otete also conducted transactions himself. Finally, Otete and Sanya received a substantial share of the proceeds after paying the students, the corrupt bank employees, and the costs of producing the checks.
In addition to the check fraud scheme, from October 2010 through November 2012, Otete conspired with co-defendants Aderomilehin, Fakeye, Akintuyi, Okpala, Hannah Moekay Konteh and others to execute a second scheme by obtaining stolen credit card numbers from individuals who worked in local businesses and “skimmed” credit cards. The skimmed numbers were used to re-encode credit cards the defendants already had. Otete and Sanya both had equipment to re-encode the credit cards and did so regularly. Sometimes they were paid for the cards, and sometimes they received a percentage of the funds which were obtained by using the re-encoded cards. Sometimes Otete directed co-defendants as to what to purchase. In some cases, Otete, Sanya, or others involved in the conspiracy identified complicit tellers or cashiers to use for transactions. Individuals traveled to North Carolina, Pennsylvania, Georgia and other locations to conduct transactions. Eventually, Otete taught others, such as Fakeye and Aderomilehin, how to manufacture the counterfeit credit cards and they obtained their own equipment.
In March 2011, Otete was arrested. A search warrant was subsequently executed at the apartment shared by Otete and Sanya. Sanya had disposed of his own equipment, but had left Otete’s equipment to be discovered. When he was released, Otete went to live with a friend of Sanya’s in Florida, and resumed credit card fraud as a way to pay his expenses. On several occasions he arranged for co-defendant Hannah Konteh to visit him and assist by conducting fraudulent transactions. Within months, Otete was arrested and detained for this conduct. He was subsequently convicted and served a sentence of nearly 41 months for the Florida conduct. Upon his release, he was transferred to Maryland for this case.
Otete and his co-conspirators attempted to obtain between $400,000 and $1 million as a result of the two fraud conspiracies, using the identities of more than 250 victims.
Oluwaseun Sanya, age 28, of Beltsville, Maryland; Jimoh Babatunde Aderomilehin, age 24, of Randallstown, Maryland;; Olaniyi Olalekan Akintuyi, age 25, of Baltimore; Moyosore Fakeye, age 27, of Baltimore; Obinna Stanley Okpala, age 24, of Baltimore; and Hannah Moekay Konteh, age 26, of Clinton, Maryland; Brianna Janet Turner, age 25, of Upper Marlboro, Maryland; Brittnee Ashanya Bellamy Handon, age 24, of Baltimore; and Nazrat Zaman, age 24, of Baltimore, previously pleaded guilty and were sentenced. Sanya was sentenced to 212 months in prison; Turner was sentenced to 65 months in prison; Konteh and Handon were each sentenced to four years in prison; Aderomilehin, Akintuyi, Fakeye, and Okpala were each sentenced to three years in prison; and Zaman was sentenced to six months.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
United States Attorney Rod J. Rosenstein thanked the U.S. Secret Service and the Montgomery County and Baltimore County Police Departments for their work in the investigation. Mr. Rosenstein praised Assistant U.S. Attorney Tamara L. Fine, who prosecuted the case.
Rapper Young Buck Pleads Guilty and Sentenced for Violating Terms of Supervised ReleaseRead the Press Release
David Darnell Brown aka “Young Buck,” 34, of Murfreesboro, Tenn., pleaded guilty today to knowingly and willfully falsifying, concealing, and covering up by trick, scheme, and device, material facts regarding his possession and use of marijuana, by providing a false urine sample and lying to a U.S. Probation Officer, announced David Rivera, U.S. Attorney for the Middle District of Tennessee. Brown was sentenced by U.S. District Judge Todd J. Campbell to serve 18 months’ probation, pay a $7,500 fine; perform 100 hours of community service; and submit to mandatory drug testing and treatment.
In July 2013 Brown was convicted of two felonies in U.S. District Court; being a convicted felon in unlawful possession of a firearm and being a convicted felon in unlawful possession of ammunition. Brown was sentenced to 18 months in prison and to a 3-year term of supervised release for these offenses. He completed his prison sentence and began his term of supervised release in November 2013.
Among other conditions of his supervised release, Brown was not to use or possess any controlled substances, including marijuana, and was required to submit to random drug testing during the period of supervised release.
On May 13, 2015, Brown was subjected to a random urinalysis to determine his compliance with the Court’s order against using controlled substances. Before providing a urine sample, Brown was asked by a U.S. Probation Officer if he had used or possessed any controlled substances and he replied that he had not. Brown then proceeded to supply a urine sample, at which time the probation officer noticed that he was providing the sample from a device designed to provide urine from another person, consisting mainly of a plastic bag concealed under his clothing and an attached tube designed to deliver a stream of urine. Brown used this device in an attempt to conceal his illegal use of marijuana.
In sentencing Brown, Judge Campbell commented that the defendant’s conduct “goes to the integrity of the system.”
This case was referred by the U.S. Probation Office and prosecuted by Assistant U.S. Attorney Sunny A.M. Koshy.
Prison Escapee Who Was Arrested in Kansas Sentenced on Firearm ChargeRead the Press Release
WICHITA KAN. – An escapee from an Oklahoma prison who was arrested with a gun in Kansas was sentenced Thursday to 53 months in federal prison, U.S. Attorney Barry Grissom said. The sentence will be served consecutively to his prison term in Oklahoma.
Lance D. Colbert, 40, who was an inmate at the Mack Alford Correctional Center in Stringtown, Okla., pleaded guilty to one count of unlawful possession of a firearm following a felony conviction.
On March 11, 2015, two days after escaping from the Oklahoma prison, Colbert was arrested in Spivey, Kan. (Kingman County). He had a .38 caliber Smith and Wesson revolver in his pants pocket.
Grissom commended the Bureau of Alcohol, Tobacco, Firearms and Explosives, the U.S. Marshals Service, the Kansas Highway Patrol and Assistant U.S. Attorney Lanny Welch for their work on the case.
PoleZero Corporation Agrees to Pay $2.8 Million to Resolve False Claims Act AllegationsRead the Press Release
Baltimore, Maryland – Department of Defense contractor PoleZero Corporation, owned by Dover Corporation since 2007, has agreed to pay the United States $2,800,000 to resolve allegations under the False Claims Act that the company caused false claims to be submitted to the Department of Air Force for communications equipment.
The settlement was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Robert Craig of the Defense Criminal Investigative Service (DCIS) - Mid-Atlantic Field Office; Brigadier General Keith M. Givens, Commander of the Air Force Office of Special Investigations; Special Agent in Charge Darrell Gilliard of the Naval Criminal Investigative Service (NCIS), Washington Field Office.
Pole Zero is a subcontractor that provided radiofrequency filters (RF filters) and integrated co-site equipment (ICE) to the United States Air Force for use in its E-3 AWACS Aircraft program. The settlement agreement resolves allegations that from 2004-2013 Pole Zero knowingly provided RF filters and ICE equipment that failed to meet contractual specifications. PoleZero denies the allegations.
“Defense contractors are expected to ensure that the equipment they provide meets the expectations of the contract. The military needs to be able to depend on the quality of the products it purchases," said United States Attorney for the District of Maryland Rod J. Rosenstein.
“Getting what you pay for is something we all should expect,” said Robert Craig, Special Agent in Charge for the DCIS, Mid-Atlantic Field Office. “DCIS and its law enforcement partners remain steadfast in expecting contractors to adhere to agreements made with the government when providing products and services.”
The civil settlement resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and obtain a portion of the government's recovery. The civil lawsuit was filed in the District of Maryland (United States ex rel. Stoneham v. PoleZero Corporation, PoleZero Acquisition, Inc. and Dover Corporation, WDQ 12-392). As part of today’s resolution, the Relator will receive $504,000 from the settlement.
The settlement was a result of an investigation by the U.S. Attorney's Office for the District of Maryland, U.S. Department of Justice, DCIS, Air Force Office of Special Investigations, and NCIS. Mr. Rosenstein commended the Defense Contract Audit Agency for their assistance in the investigation. The investigation was handled by Assistant U.S. Attorneys Thomas H. Barnard and Thomas F. Corcoran and Senior Trial Counsel Dan Spiro from the Department of Justice.
Pittston Man Sentenced to 63 Months in Prison for Conspiracy to Distribute Bath SaltsRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Alan Folweiler, age 22, of Pittston, Pennsylvania, was sentenced to 63 months’ imprisonment by United States District Court Judge Malachy E. Mannion for participating in a conspiracy to distribute alpha-pvp, commonly known as “bath salts.”
According to United States Attorney Peter Smith, Folweiler pleaded guilty in April 2015 to his involvement in the conspiracy which was responsible for distributing large quantities of alpha-pvp, a controlled substance analogue, to others during 2011 through 2013.
Folweiler was indicted by a federal grand jury in August 2014, following an investigation by Department of Homeland Security agents, the Pennsylvania State Police, and West Pittston Police.
Judge Mannion also ordered Folweiler to serve three years on supervised release following his prison sentence, and to pay a special assessment of $100.
The case was prosecuted by Assistant U.S. Attorney Francis P. Sempa.
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Orlando Men Sentenced to More Than Thirteen Years for String of Armed RobberiesRead the Press Release
Orlando, FL – U.S. District Judge G. Kendall Sharp has sentenced three Orlando residents for robbery and using a firearm in furtherance of a crime of violence. Malcolm Jamal Ward (23), Stanley Valentin (20), and Javier Tyson Farrar (21) were each sentenced to 13 years and 6 months in federal prison. The Court also ordered them to pay $5,637.42 in restitution. Valentin and Farrar pleaded guilty on April 28, 2015. Ward pleaded guilty on May 4, 2015.
According to court documents, over the course of two weeks in October 2014, Ward, Valentin, and Farrar committed six armed robberies. One of the robberies occurred at a Red Lobster restaurant in Orlando as the employees were closing for the night. The five other robberies involved drugstores throughout Orange, Volusia, Osceola, and Polk Counties. In addition, Ward committed an additional armed robbery of a drugstore by himself during that same period.
This case was investigated by the Federal Bureau of Investigation, the Orange County Sheriff’s Office, the Osceola County Sheriff’s Office, the Volusia County Sheriff’s Office, and the Polk County Sheriff’s Office. It was prosecuted by Assistant United States Attorney Vincent S. Chiu.
Navajo Woman Pleads Guilty to Federal Involuntary Manslaughter ChargeRead the Press Release
ALBUQUERQUE – Clara Beth Joe, 26, an enrolled member of the Navajo Nation who resides in Gallup, N.M., pleaded guilty this morning in Albuquerque, N.M., to an involuntary manslaughter charge.
Joe was arrested on Aug. 27, 2014, on an indictment filed Aug. 12, 2014, charging her with involuntary manslaughter on Jan. 30, 2014, in San Juan County, N.M.
During today’s proceedings, Joe pled guilty to the indictment and admitted that on Jan. 31, 2014, she was found by law enforcement in Crystal, N.M., on the Navajo Indian Reservation, near a creek, heavily intoxicated and suffering from hypothermia. Joe admitted that her cousin also arrived at the scene and asked where Joe’s 13-month-old son was, and after a search by law enforcement, the boy was found drowned near where Joe had been found. Joe further admitted that her level of intoxication was a negligent act and was an important contributing factor in her son’s death.
At sentencing, Joe faces a statutory maximum penalty of eight years in federal prison followed by up to three years of supervised release. A sentencing hearing has yet to be scheduled.
This case was investigated by the Gallup office of the FBI and the Navajo Nation Division of Public Safety. Assistant U.S. Attorney Paul H. Spiers is prosecuting the case.
Navajo Man from Beclabito Sentenced to Federal Prison for Arson ConvictionRead the Press Release
ALBUQUERQUE – Benjamin Joe Begay, Jr., 45, an enrolled member of the Navajo Nation who resides in Beclabito, N.M., was sentenced this afternoon in federal court in Albuquerque, N.M., to a year and a day in prison followed by three years of supervised release for his arson conviction.
Begay was arrested on Aug. 19, 2014, on a criminal complaint charging him with arson, and was indicted on that same charge on Aug. 26, 2014. According to court filings, Begay set fire to the residence he shared with his wife and children on July 31, 2014, following an argument with his family. The residence, its contents and a grey truck were a total loss to the fire.
On March 31, 2015, Begay pled guilty and admitted willfully and maliciously setting fire to the home he shared with his wife and family on July 31, 2014, on the Navajo Indian Reservation in San Juan County, N.M.
This case was investigated by the Shiprock office of the Navajo Nation Division of Public Safety and the Farmington office of the FBI. The case was prosecuted by Assistant U.S. Attorney Paul H. Spiers.
This case was brought as part of the Tribal Special Assistant U.S. Attorney (Tribal SAUSA) Pilot Project in the District of New Mexico which is sponsored by the Justice Department’s Office on Violence Against Women under a grant administered by the Pueblo of Laguna. The Tribal SAUSA Pilot Project seeks to train tribal prosecutors in federal law, procedure and investigative techniques to increase the likelihood that every viable violent offense against Native women is prosecuted in either federal court or tribal court, or both. The Tribal SAUSA Pilot Project was largely driven by input gathered from annual tribal consultations on violence against women, and is another step in the Justice Department's on-going efforts to increase engagement, coordination and action on public safety in tribal communities.
Muskogee Man Sentenced to 57 Months for Firearm PossessionRead the Press Release
MUSKOGEE, OKLAHOMA - The United States Attorney’s Office for the Eastern District of Oklahoma, announced today that JORDAN WAYNE PARKS, age 24, of Muskogee, Oklahoma, was sentenced to 57 months imprisonment, followed by 3 years of supervised release for Felon in Possession of a Firearm, in violation of Title 18, United States Code, Section 922(g)(1).
Charges arose from an investigation by the Muskogee Police Department and the Federal Bureau of Investigation. The defendant was indicted in March, 2015 and pled guilty in April, 2015.
The Indictment alleged that on or about June 17, 2014, within the Eastern District of Oklahoma, the defendant, having been convicted of a crime punishable by imprisonment for a term exceeding one year, did knowingly possess in and affecting commerce, a firearm, which had been shipped and transported in interstate commerce.
The Honorable Ronald A. White, District Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, presided over the hearing. The defendant will remain in the custody of the United States Marshal Service pending transportation to the designated federal prison at which he will serve his nonparolable sentence.
Assistant United States Attorney Dean Burris represented the United States.
Middlesex County, New Jersey, Man Sentenced to Five Years in Prison for Distributing Child Sex Abuse ImagesRead the Press Release
NEWARK, N.J. - An East Brunswick, New Jersey, man was sentenced today to 60 months in prison for sharing images of child sexual abuse from his home computer, U.S. Attorney Paul J. Fishman announced.
Armia Alber, 29, previously pleaded guilty before U.S. District Judge Stanley R. Chesler to an indictment charging him with distributing images of child pornography over the Internet. Judge Chesler imposed the sentence today in Newark federal court.
According to documents filed in the case and statements made in court:
Alber admitted that between March and July 2013, he was a member of an online peer-to-peer file sharing network and had more than 600 images or videos of children being sexually abused. Alber also admitted he made images and videos of child pornography available for other members to download from his “shared” folder. During this period, a law enforcement agent successfully downloaded multiple images and videos of child sexual abuse from Alber’s computer.
On July 25, 2013, federal law enforcement agents executed a search warrant at Alber’s residence. The agents recovered two computer hard drives, both of which contained numerous images and videos of child pornography.
As part of his guilty plea, Alber agreed to forfeit the computers and computer accessories he used to commit the offense. He is also required to register as a sex offender.
In addition to the prison term, Judge Chesler sentenced Alber to serve five years of supervised release.
U.S. Attorney Fishman credited special agents of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), under the direction of Acting Special Agent in Charge Kevin Kelly, with the investigation leading to the sentencing. He also thanked the Middlesex County Prosecutor’s Office and the East Brunswick Police Department for their roles in the search and arrest.
The government is represented by Assistant U.S. Attorney Josh Hafetz of the U.S. Attorney’s Office General Crimes Unit in Newark.
Defense counsel: Assistant Federal Public Defender Carol Gillen Esq., Newark
Miami Resident Sentenced in Stolen Identity Tax Refund Fraud SchemeRead the Press Release
A Miami resident was sentenced by U.S. District Court Judge Darrin P. Gayles for her participation in a stolen identity tax refund fraud scheme. Melissa Pearl Davis (“Davis,”) 32, was sentenced to 48 months in prison, followed by three years of supervised release, and was ordered to pay restitution in the amount of $219,721.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (“FBI”), Miami Field Office, and Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (“IRS-CI”), made the announcement.
Davis and her co-defendant, Kiesha Adderly Mitchell (“Mitchell,”) 36, each previously pled guilty to one count of conspiracy to defraud the government with respect to claims, in violation of Title 18, United States Code, Section 286, and one count of aggravated identity theft, in violation of Title 18, United States Code, Sections 1028A(a)(1) and 2. As part of their plea agreements, each defendant agreed to restitution in the amount of $219,721.
According to court documents, in 2009, the defendants applied to the Internal Revenue Service (“IRS”) for Electronic Filing Identification Numbers (“EFINs”) in the name of corporate or fictitious entities they controlled, including K. Mitch Services, Inc. and Pebbles Tax & Notary Services. The defendants used those EFINs to submit false and fraudulent federal income tax returns to the IRS, using the names and Social Security numbers of other individuals, without the taxpayers’ authority. After the tax returns were received by the IRS, various financial institutions would authorize the defendants to load onto debit cards refund anticipation loans in the names of tax payers whose names and Social Security numbers were used to file the false and fraudulent tax returns. The defendants then withdrew the unlawfully obtained tax proceeds from the debit cards for their personal use and enrichment. The total intended loss from the defendants’ false and fraudulent filings of unauthorized income tax returns was over $400,000.
A sentencing date has not been set for Mitchell.
Mr. Ferrer commended the investigative efforts of the South Florida Identity Theft Tax Fraud Strike Force, with special commendation to the FBI and IRS-CI. This case is being prosecuted by Assistant U.S. Attorney Maurice A. Johnson.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Mexican National Sentenced for Federal Heroin Trafficking Conviction in New MexicoRead the Press Release
ALBUQUERQUE – Yareli Jasmin Bustamante-Conchas, 29, a Mexican citizen illegally residing in Albuquerque, N.M., was sentenced this afternoon in federal court to 60 months in prison for her federal heroin trafficking conviction. She will be deported after completing her prison sentence. Bustamante-Conchas also was ordered to forfeit $42,818.47 which were proceeds of her drug trafficking activities.
Bustamante-Conchas was arrested on a criminal complaint on Aug. 29, 2014, in Bernalillo County, N.M., after DEA agents seized approximately 745.4 grams of heroin, drug packaging materials and $42,818.47 in U.S. currency from Bustamante-Conchas’ residence during a consensual search.
Bustamante-Conchas was subsequently indicted on Sept. 23, 2014, and charged with possession of heroin with intent to distribute. The indictment included forfeiture provisions seeking an order requiring Bustamante-Conchas to forfeit $102,000.00 representing drug proceeds in addition to the $42,818.47 seized from her home on Aug. 29, 2014.
On March 24, 2015, Bustamante-Conchas pled guilty to the indictment and admitted that on Aug. 28, 2014, DEA agents seized 745.4 grams of heroin, $42,818.47 in cash and drug packaging materials from her home. Bustamante-Conchas also admitted that she was illegally present in the United States and had been making approximately $3,000.00 a week by distributing heroin since Dec. 2013.
This case was investigated by the Albuquerque office of the DEA and was prosecuted by Assistant U.S. Attorney Nicholas Jon Ganjei.
This case was prosecuted pursuant to the New Mexico Heroin and Opioid Prevention and Education (HOPE) Initiative. The HOPE Initiative is a collaborative effort between the U.S. Attorney’s Office and the University of New Mexico Health Sciences Center that is partnering with the Bernalillo County Opioid Accountability Initiative with the overriding goal of reducing the number of opioid-related deaths in the District of New Mexico. The HOPE Initiative comprised of five components: (1) prevention and education; (2) treatment; (3) law enforcement; (4) reentry; and (5) strategic planning. The law enforcement component of the HOPE Initiative is led by the Organized Crime Section of the U.S. Attorney’s Office and the DEA in conjunction with their federal, state, local and tribal law enforcement partners. Targeting members of major heroin trafficking organizations for investigation and prosecution is a priority of the HOPE Initiative.
Man Indicted for Kidnapping in FairbanksRead the Press Release
Anchorage, Alaska – United States Attorney Karen L. Loeffler announced today that a federal grand jury returned a two-count indictment against Michael Dewayne Bowen, Jr., 40, charging him with kidnapping two girls in North Pole, Alaska.
According to the Indictment, on August 1, 2015, Bowen willfully and unlawfully seized, confined, inveigled, decoyed, kidnapped, abducted, and carried away the two girls, ages 6 and 9 years old, using any means, facility and instrumentality of interstate and foreign commerce and transported them within the special jurisdiction of the United States.
The case was the product of an investigation by the Federal Bureau of Investigation and the North Pole Police Department. Assistant U.S. Attorney Audrey J. Renschen and U.S. Department of Justice Trial Attorney Jeffrey Zeeman are prosecuting the case.
If convicted of kidnapping, Bowen faces a minimum statutory penalty of 20 years, and up to life imprisonment, as to each count. Both counts also carry fines of up to $250,000, as well as the possibility of a life time period of supervised release following any sentence of imprisonment. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
This prosecution is part of the Department of Justice’s ongoing Project Safe Childhood initiative which was launched to protect children from exploitation.
Kanawha County man sentenced to 97 months in prison for possessing child pornographyRead the Press Release
Charleston, W.Va. – A 58-year old Kanawha County man, Ronnie Eugene Naylor, was sentenced to 97 months in federal prison followed by 15 years of supervised release for possessing child pornography, United States Attorney Booth Goodwin announced. The sentence was handed down by United States District Judge John T. Copenhaver, Jr.
Naylor previously admitted that on April 10, 2014, he possessed over 600 images and videos of prepubescent minors engaged in sexual acts. The videos were stored on his personal computer located at his Elkview home. The investigation revealed that Naylor was using two peer-to-peer file sharing programs to share child pornography via the Internet. Some of the videos possessed by Mr. Naylor depict a prepubescent minor engaged in sadistic or masochistic conduct or other depictions of violence. “We will make every effort to ensure that our children are not the victims of such depravity” said Goodwin. “The sentence in this case reflects the seriousness of the offense, and society’s intolerance of victimizing children.”
The West Virginia State Police and the West Virginia Internet Crimes Against Children Task Force conducted the investigation. Assistant United States Attorney Lisa G. Johnston was in charge of the prosecution.
This case is being brought as part of U.S. Attorney Goodwin’s ongoing initiative to combat child sexual exploitation and abuse in the Southern District of West Virginia.
Kalamazoo Man, Jesus Emmanuel Lopez-Garcia, Sentenced for His Role in Counterfeit Identification Document RingRead the Press Release
The ring operated throughout Kent and Kalamazoo counties
GRAND RAPIDS, MICHIGAN — Jesus Emmanuel Lopez-Garcia, age 31, a citizen of Mexico who most recently resided illegally in Kalamazoo, Michigan, was sentenced to 36 months’ imprisonment today for his role in a counterfeit identification document ring. U.S. District Judge Robert Holmes Bell noted that the offense “undermined the authority of the United States” in imposing a sentence above the sentencing guidelines.
Between September, 2013, and March, 2015, Lopez-Garcia conspired with Jaime Velasco-Jimenez and Victor Hugo Quesada-Pacheco (also citizens of Mexico residing illegally in Kalamazoo), to produce and distribute counterfeit identification documents. Lopez-Garcia and Quesada-Pacheco solicited business from illegal aliens residing in Kent and Kalamazoo counties in need of counterfeit identification documents. Lopez-Garcia and Quesada-Pacheco provided the names, false social security account numbers, and other false biographical information for their customers to Velasco-Jimenez who then produced counterfeit driver’s licenses, state identification documents, social security account number cards, lawful permanent resident cards, and other false identification documents at his apartment in Kalamazoo. Lopez-Garcia and Quesada-Pacheco then delivered the counterfeit identification documents to their customers and collected a fee that was shared with Velasco-Jimenez. The ring produced well in excess of 100 sets of counterfeit identification documents during its operation.
“The U.S. is a nation where the rule of law governs,” said U.S. Attorney Patrick Miles. “Producing counterfeit identification documents for profit under the seal and purported authority of state and federal agencies is blatantly illegal and will be prosecuted to the fullest extent of the law.”
“Document fraud directly threatens national security and undermines the integrity of our nation’s immigration system,” said Marlon Miller, special agent in charge of HSI Detroit. “HSI will continue to aggressively target and dismantle criminal organizations as well as individuals who perpetrate these schemes.”
Lopez-Garcia now faces proceedings regarding his deportation from the United States and recently forfeited numerous electronic devices and $17,488.00 related to his crime. Velasco-Jimenez will be sentenced in federal court on September 11, 2015, and Quesada-Pacheco on September 17, 2015.
Assistant United States Attorney Ronald M. Stella is prosecuting the case. The investigation is being handled by the Department of Homeland Security, U.S. Immigration and Customs Enforcement, Homeland Security Investigations division in Grand Rapids.END
Jefferson City Man, El Paso Woman Plead Guilty to Marriage Fraud ConspiracyRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a Ukrainian national in Jefferson City, Mo., and an El Paso, Texas, woman have pleaded guilty in federal court to their roles in a marriage fraud conspiracy so that he could remain in the United States.
Oleksandr Nikolayevich Druzenko, also known as “Alex,” 35, of Jefferson City, pleaded guilty today before U.S. Magistrate Judge Matt J. Whitworth. Co-defendant Patricia Anne Ewalt, 63, of El Paso, pleaded guilty to the same charge on Aug. 5, 2015.
Druzenko and Ewalt were married on June 22, 2007, in Jefferson City. Druzenko is a Ukrainian national who entered the United States on a student visa in August 2004 and attended college in Missouri and elsewhere. He was employed at the Missouri Office of Administration in Jefferson City at the time of the Oct. 3, 2012, indictment.
In 2007, Druzenko’s student visa was expiring and he would soon have to leave the United States. After two failed attempts to persuade U.S. citizens to marry him so that he could remain in the country, Ewalt agreed to marry him.
Druzenko and Ewalt, along with co-defendants James Douglas Barding, 62, of Jefferson City, and Darya Chernova, 40, a citizen of Ukraine who currently resides in Chandler, Ariz., entered an agreement to unlawfully deceive the U.S. Citizenship and Immigration Service in matters regarding immigration and naturalization. According to today’s plea agreement, they conspired to arrange a fraudulent marriage between Druzenko and Ewalt so that he could remain in the United States in violation of the law.
Druzenko and Ewalt falsely claimed that they resided together, when, in fact, Druzenko and Ewalt did not live with each other. Druzenko and Ewalt each admitted that they knowingly submitted documents that were materially false and would serve to deceive the U.S. Citizenship and Immigration Service into believing Druzenko’s marriage to Ewalt was genuine. They also admitted that they submitted fraudulent documents so that Druzenko could achieve resident status in the United States.
Barding and Chernova have pleaded guilty to their roles in a marriage fraud conspiracy aimed at enabling Chernova, with whom Barding had a long-running affair, to remain in the United States and seek citizenship.
As a result of his fraudulent marriage to Ewalt, and the submission of false material statements to U.S. Citizenship and Immigration Service, Druzenko was allowed to remain in the United States and gained permanent resident status when in fact he should not have been allowed to remain in the country and did not lawfully qualify for any adjustment to status.
Under federal statutes, Druzenko and Ewalt are each subject to a sentence of up to five years in federal prison without parole, plus a fine up to $250,000. Sentencing hearings will be scheduled after the completion of presentence investigations by the United States Probation Office.
Today’s guilty plea may have consequences with respect to Druzenko’s immigration status because this is considered a removable offense. Removal and other immigration consequences are the subject of a separate proceeding; however, because Druzenko is pleading guilty to conspiracy to commit offenses against the United States, removal is presumptively mandatory.
This case is being prosecuted by Assistant U.S. Attorney Anthony P. Gonzalez. It was investigated by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI), the U.S. Citizenship and Immigration Services and the Jefferson City, Mo., Police Department.
Investment Advisor Indicted for Defrauding Investors of More Than $1.2 MillionRead the Press Release
The United States Attorney’s Office for the District of Minnesota announced the indictment of DAVID BLAINE WELLIVER, 55, for defrauding investors in the Dblaine Fund, a mutual fund for which WELLIVER acted as investment adviser, of at least $1.2 million. The defendant is scheduled to make an initial appearance on September 3, 2015, in U.S. District Court in St. Paul, Minn.
According to the indictment, throughout most of 2010, the Dblaine Fund had only a small number of individual investors. In March 2010, in order to increase the Dblaine Fund’s net assets, WELLIVER entered into an agreement in which, in exchange for a payment of approximately $100,000 to another investment adviser, the Dblaine Fund would acquire the assets of two other mutual funds, the Bryce Capital Growth Fund and the Bryce Capital Value Fund (Bryce Funds).
According to the indictment, because WELLIVER’s investment advisory business had never generated substantial revenues, it lacked the capital to finance the merger between the Dblaine Fund and the Bryce Funds. As of June 30, 2010, WELLIVER’s investment advisory company, Dblaine Capital, had less than $200 in liquid assets. During the same time period, WELLIVER had less than $2,000 in his personal bank accounts, and WELLIVER personally owed millions of dollars in civil judgments, federal income taxes, and other debts. Through his company Dblaine Capital, WELLIVER borrowed money from Lazy Deuce Capital Company, LLC (Lazy Deuce), a limited liability company based in Burnsville, Minn., to finance the merger between the Dblaine Fund and the Bryce Funds. On or about December 8, 2010, WELLIVER used funds borrowed from Lazy Deuce to make a $95,000 payment to the Bryce Funds’ investment adviser, and thereafter the merger was completed. As a result of the merger, the Dblaine Fund’s assets under management increased from approximately $500,000 to over $9 million.
According to the indictment, as part of the scheme to defraud investors in the Dblaine Fund, WELLIVER, in 27 separate transactions between October 2010 and May 2011, borrowed a total of $4 million from Lazy Deuce. Aside from the $95,000 payment to acquire the assets of the Bryce Funds, WELLIVER did not use any of the other proceeds of the Lazy Deuce loans to acquire mutual funds as he had represented to Lazy Deuce. Instead, WELLIVER diverted over $500,000 in proceeds from the Lazy Deuce loans to his own personal use, including for landscaping and interior decorating at his personal residence, to purchase land adjacent to his personal residence, to buy a personal vehicle, and to pay for his son’s college tuition.
According to the indictment, in exchange for Lazy Deuce’s agreement to lend funds to Dblaine Capital, WELLIVER agreed to use his position as investment adviser to the Dblaine Fund to cause Dblaine Fund investors’ money to be invested back into Lazy Deuce. In exchange for Lazy Deuce’s agreement to lend funds to Dblaine Capital, WELLIVER agreed to invest money from the Dblaine Fund back in Lazy Deuce. However, in order to conceal the nature of this transaction from the Dblaine Fund’s investors, its Board of Trustees, and its other service providers, WELLIVER made these investments into a shell company formed by several Lazy Deuce principals, called Semita Partners LLC (Semita).
According to the indictment and documents filed in court, between December 16, 2010, and April 15, 2011, WELLIVER caused $1.725 million in Dblaine Fund investors’ money to be invested in Semita. At the time WELLIVER made the investments in Semita, he knew that Semita was a shell company formed by principals of Lazy Deuce – the same company from which Dblaine Capital had borrowed money – and that Semita had no operations. On December 31, 2010, in order to meet a series of redemptions in the Dblaine Fund, Welliver liquidated nearly all of the stocks held by the Dblaine Fund. Following this liquidation, the Dblaine Fund’s only holdings consisted of worthless Semita shares and cash held in a money market account.
This case is the result of an investigation conducted by the United States Postal Inspection Service, the Federal Bureau of Investigation, and the Internal Revenue Service – Criminal Investigation.
This case is being prosecuted by Assistant United States Attorneys Kimberly A. Svendsen and Benjamin F. Langner.
Defendant Information:
DAVID BLAINE WELLIVER, 55
Buffalo, Minn.
Charges:
- Wire fraud, 5 counts
- Mail fraud, 4 counts
- Money laundering, 5 counts
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
The charges are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Indictment Charges Six Defendants in Connection with 86 Stolen GunsRead the Press Release
LITTLE ROCK - Christopher R. Thyer, United States Attorney for the Eastern District of Arkansas and Grover Crossland, Resident Agent in Charge for the Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF), announced today the unsealing of a two-count Indictment charging multiple defendants with the possession of firearms stolen from the Hunter’s Refuge sporting goods store in White Hall, Arkansas. An investigation into a series of burglaries at the shop resulted Thursday in the early-morning arrests of five defendants by the ATF along with the assistance of the Pine Bluff and White Hall police departments. Another defendant named in the Indictment remains in state custody on unrelated charges.
On Friday, August 21, 2015, at 2 p.m., five defendants will be arraigned by United States Magistrate Judge Joe J. Volpe. The remaining defendant will be arraigned on August 27, 2015. The case number is 4:15-cr-204-JM.
The ATF investigation revealed that a group of individuals forced entry into Hunter’s Refuge on December, 18, 2014, broke into a number of locked glass display cases, and stole 24 handguns. On January 8, 2015, a group of individuals again forced entry into Hunter’s Refuge and stole 62 more guns, including eight assault rifles. A number of the stolen guns have since been recovered.
The Indictment, returned by a Federal Grand Jury on August 5th, 2015, charges six defendants with two separate counts of possession of stolen firearms. Count One charges Sir Arthur Carrington-Fields, 19, with possession of one or more of the 24 firearms stolen from Hunter’s Refuge on December 18, 2015. Count Two charges Jakheeno Stewart, 19; Charles Moore Jr., 19; Rodderick Goins, 19; Raheem Wise, 19; Martel Donaldson, 19; and Carrington-Fields with possession of one or more of the 62 firearms stolen from Hunter’s Refuge on January 8, 2015. All defendants are residents of Pine Bluff, Arkansas. Possession of a stolen firearm is punishable by no more than 10 years of incarceration in the Bureau of Prisons, with a possible fine of up to $250,000, and not more than 3 years supervised release.
The investigation was conducted by the ATF, with assistance from several law enforcement agencies including the Pine Bluff Police Department and White Hall Police Department. The case is being prosecuted by Assistant United States Attorney Hunter Bridges.
An indictment contains only allegations. A defendant is presumed innocent unless and until proven guilty.
Grand Jury Returns Indictment Charging Pair with Fraud, Money Laundering in Connection with Alleged Investment Fraud SchemeRead the Press Release
SALT LAKE CITY – A federal grand jury returned a 48-count indictment late Wednesday afternoon charging Wayne LeMar Palmer, age 60, and Julieann Martin, age 47, both of West Jordan, with wire fraud, mail fraud and money laundering in connection with an alleged investment fraud scheme that raised more than $140 million from more than 600 investors.
According to the indictment, Palmer established National Note of Utah (NNU) about Dec. 30, 1992. NNU was located in West Jordan. Palmer owned and operated NNU and made all business decisions, including decisions regarding the use of investor funds. Martin began working at NNU in about 1993. Among other duties, she functioned as a client relations manager, which allowed her to interact with many of NNU’s investors and gave her access to information about investors’ investments with NNU, the indictment alleges.
The indictment alleges NNU solicited and sold investments, generally in the form of fixed rate promissory notes at a rate of 12 percent per year. NNU purported to be in the business of purchasing existing real estate loans and funding new real estate loans. NNU supposedly used investor funds to purchase discounted mortgage notes and deeds of trust and to originate real estate loans at above-market rates. NNU engaged in a variety of other business activities during its existence in an effort to generate revenue, the indictment says, including acquiring and operating rental properties, developing properties it obtained through foreclosures, purchasing real estate for development, buying and operating a mint, and seeking to extract precious metals from previously processed mine tailings.
The indictment alleges Palmer and Martin recruited and retained investors using fraudulent and misleading statements. According to the indictment, Palmer traveled around the country to recruit individuals and entities to invest in NNU. Martin also had contact with potential and existing investors over the phone, in person, and by email communications. For some investors, Martin was their only contact with NNU.
The indictment alleges Palmer and Martin solicited investors with false and fraudulent statements, which included among others, that the investments were safe and guaranteed; NNU was profitable and generated sufficient income from its business operations to pay investors a 12 percent annual return; NNU’s business activities were generating 18 percent or more per year; investments in NNU were secured by real estate assets which exceeded NNU’s investor liabilities; and that NNU had a perfect payment record and had never been late on a single investor payment.
According to the indictment, Palmer and Martin did not tell investors that new investor funds were being used to make payments to older investors and to pay NNU operating expenses. They also were used to pay Palmer’s personal expenses, the indictment alleges.
They also did not tell investors that the vast majority of NNU investments were with affiliated entities Palmer controlled, rather than arms-length investments with third parties. They also did not disclose, among other things, that beginning around 2007, NNU and its affiliates had, on aggregate, reported net losses and negative equity every year and that NNU had insufficient operating revenues to pay investors and operating expenses.
Between 1995 and 2012, according to the indictment, Palmer and Martin raised more than $140 million from more than 600 investors. Many investors, the indictment alleges, lost all or part of their money invested in NNU. Some of the investors utilized self-directed retirement funds to make their investments. When investors complained about late or missing payments, Palmer and Martin typically did not disclose the true state of affairs at NNU but told investors to be patient and payments would be forthcoming.
The indictment includes 14 counts of wire fraud. Palmer is charged in each of the 14 counts and Martin is charged in 11 counts. Palmer is charged in all 17 counts of mail fraud included in the indictment and Martin is charged in nine counts. They are both charged in 17 counts of money laundering in the indictment.
The defendants will receive a summons to appear in federal court for an initial appearance on the charges. The potential maximum penalty for each count of wire and mail fraud is 20 years in prison. The money laundering counts in the indictment carry potential maximum sentences of 10 years in prison.
An indictment is not a finding of guilty. Individuals charged in indictments are presumed innocent unless or until proven guilty in a court.
The case is being prosecuted by the U.S. Attorney’s Office in Utah. Special agents of the FBI and IRS Criminal Investigation are investigating the case. The U.S. Department of Labor, Employee Benefits Security Administration has also contributed to the investigation.
Fourteen Individuals Charged with Conspiracy to Commit Marriage Fraud and Related Immigration Fraud ChargesRead the Press Release
Fourteen individuals have been charged by federal indictment with conspiracy to commit marriage fraud and related immigration fraud charges.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Alysa D. Erichs, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), and Linda M. Swacina, District Director, U.S. Citizenship and Immigration Services (USCIS) made the announcement.
Odalys Marrero, 51, of Kendall, Rolando Mulet, 62, of Kendall, Katiusca Elena Aguilar Navarro, 28, of Doral, Carlos Alberto Mederos Paule, 46, of Miami, Manuel Andres Gomez, 46, of Wilton Manors, Virginia De La Caridad Mederos Paule, 57, of Miami, Elisabet Kerese Alvarez, 38, of Aventura, Osvaldo Lastre Duran, 48, of Sweetwater, Natacha Perera, 44, of North Miami, Javier Manejias, 51, of Antioch, TN, Marianelly Auxiliado Rodriguez, 48, of Doral, Rafael Abreu Gonzalez, 46, of Hialeah, Okyvi Olmar Yoll Mesa, 35, of Doral, and Salvador L Cabanas, 44, of Kendall, have been charged by federal indictment with conspiracy to commit marriage fraud and related immigration fraud charges.
According to the indictment, between December 2009 and July 2014, organizers, Marrero and Mulet recruited Cuban citizens eligible for lawful permanent residence under the Cuban Adjustment Act to enter into fraudulent marriages with aliens for the purpose of evading the immigration laws of the United States. Marrero and Mulet charged the aliens a fee to arrange the fraudulent marriages, notarized the fraudulent marriage licenses, completed the necessary immigration paperwork, and prepared the co-conspirators for their interviews with United States Citizenship and Immigration Services. Aliens Aguilar Navarro, Andres Gomez, Kerese Alvarez, Perera, Auxiliado Rodriguez, and Yoll Mesa, all paid a fee to enter into fraudulent marriages with Alberto Mederos Paule, Virginia De la Caridad Mederos Paule, Lastre Duran, Manejias, Abreu Gonzalez, and Cabanas. These fraudulent marriages took place in the Southern District of Florida.
U.S. Attorney Ferrer stated, “Immigration fraud is a serious crime that undermines our nation’s immigration system and can pose a risk to our security. Our Office will continue to work with our law enforcement partners to investigate these crimes and prosecute those individuals who seek to perpetrate fraudulent immigration schemes.”
"These arrests serve as a reminder that America's legal immigration system is not for sale," said Alysa D. Erichs, special agent in charge of ICE-HSI in Miami. "HSI will not tolerate the exploitation of our country's immigration system. We will work aggressively to investigate and bring to justice those who seek to compromise the integrity of that system for personal profit or to evade immigration laws."
“USCIS has no tolerance for immigration fraud,” said Linda Swacina, Director for the USCIS Miami District. “Anyone tempted to take advantage of America’s hospitality needs to understand that USCIS is committed to ensuring the integrity of our nation’s immigration system and along with our law enforcement partners will prosecute those committing fraud to the fullest extent of the law.”
Mr. Ferrer commended the investigative efforts of ICE-HSI and USCIS, who provided significant and valuable support to this investigation.
The case is being prosecuted by Assistant United States Attorney Robert Emery.
An indictment is only an accusation, and the defendants are presumed innocent until proven guilty.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Four Former Shelby County Jailers Plead Guilty to Attempted Possession of a Controlled SubstanceRead the Press Release
Memphis, TN – Four former Shelby County Corrections Deputies have all pled guilty to attempting to smuggle and distribute OxyContin inside a correctional facility. The pleas were announced by Edward L. Stanton III, U.S. Attorney for the Western District of Tennessee.
According to the indictments, the four defendants – Torriano Vaughn, Brian Grammer, Anthony Thomas, and Marcus Green – all participated in a scheme to smuggle what they thought were OxyContin pills inside of the Shelby County Jail on multiple occasions between May and December 2014.
After inmates informed law enforcement officers of the defendants’ illicit conduct, an undercover investigation was initiated. The investigation involved law enforcement agents posing as associates of cooperating inmates. These inmates would make arrangements with the jailers to have various amounts of OxyContin pills smuggled into jail in exchange for hundreds of dollars.
The undercover agents posing as associates of the inmates met with each jailer at various locations in the city. Three undercover transactions were conducted with each defendant. During these transactions, the agents provided the defendants with several hundred dollars and varying amounts of pills, which were presumed to be OxyContin. In actuality, the pills were "placebos," a pill or substance that has no therapeutic effect. After each transaction, the defendants would smuggle the presumed OxyContin pills into the jail and provide them to cooperating inmates. All of the placebos provided to the jailers were ultimately recovered by law enforcement agents.
All four defendants have pled guilty to attempted possession of a controlled substance with the intent to distribute.
They each face up to 20 years imprisonment when convicted. Each defendant also faces up to a $1 million fine.
Thomas is scheduled to be sentenced on Friday, October 9th at 9:30 a.m. by Judge John T. Fowlkes Jr.
Green is scheduled to be sentenced on Friday, October 23rd at 11 a.m. by Judge Jon Phipps McCalla.
Grammer is scheduled to be sentenced on Tuesday, November 3rd at 9:30 a.m. by Judge Jon Phipps McCalla.
Vaughn is scheduled to be sentenced on Friday, November 6th, at 9:30 a.m. by Judge Sheryl H. Lipman.
The case was investigated by the Tarnished Badge Task Force. The collective is comprised of: the Federal Bureau of Investigation, Shelby County Sheriff’s Department, and Memphis Police Department.
Assistant U.S. Attorney Brian K. Coleman is prosecuting the case on behalf of the government.
Fort Dodge Man to Federal Prison for Meth ConspiracyRead the Press Release
A man who conspired to distribute methamphetamine was sentenced August 19, 2015, to five years in federal prison.
Jeffery Wear, 51, from Fort Dodge, Iowa, received the prison term after a May 6, 2015, guilty plea to conspiracy to distribute methamphetamine.
At the guilty plea, Wear admitted that from about 2012 through December 2014, he conspired to distribute more than 150 grams of actual (pure) methamphetamine. On December 2, 2014, in Audubon County, Iowa, law enforcement conducted a traffic stop of a vehicle driven by Wear. Law enforcement officers seized approximately ½ pound of methamphetamine from Wear’s vehicle.
Wear was sentenced in Sioux City by United States District Court Judge Mark W. Bennett. Wear was sentenced to 60 months’ imprisonment. A special assessment of $100 was imposed. He must also serve a four-year term of supervised release after the prison term. There is no parole in the federal system. Wear is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Shawn S. Wehde and investigated by the Iowa Division of Narcotics Enforcement, Audubon County Sheriff’s Office, Fort Dodge Police Department, Webster County Sheriff’s Office, and the Iowa Division of Criminal Investigations.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 14-3067.
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Former Redflex CEO Pleads Guilty to Corruption in Awarding of City of Chicago’s Red-Light Camera ContractsRead the Press Release
CHICAGO — The former chief executive officer of Chicago’s first red-light camera vendor pleaded guilty to a federal bribery charge Thursday.
As the CEO of Redflex Traffic Systems Inc., KAREN FINLEY funneled cash and other personal financial benefits to a City of Chicago official and his friend, knowing that the payments would help persuade the city to award red-light camera contracts to Redflex, according to a plea agreement. The benefits included golf trips, hotels and meals, as well as hiring the city official’s friend as a highly compensated contractor for Redflex, according to the plea agreement.
The benefits flowed over a nine-year period, from 2003 to 2011, during which time the city expanded the Digital Automated Red Light Enforcement Program by awarding millions of dollars in contracts to Phoenix-based Redflex, the plea agreement states.
Finley, 55, of Cave Creek, Ariz., pleaded guilty to one count of conspiracy to commit bribery in a federal program. U.S. District Judge Virginia Kendall scheduled a sentencing hearing for Feb. 18, 2016. Finley faces a maximum sentence of 5 years in prison, a maximum fine of $250,000 or twice the gross gain or gross loss from the offense, and mandatory restitution.
The guilty plea was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; John A. Brown, Acting Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation; Joseph M. Ferguson, Inspector General for the City of Chicago; and Stephen Boyd, Acting Special Agent-in-Charge of the Internal Revenue Service Criminal Investigation Division in Chicago.
According to the plea agreement, Redflex first began competing for the Chicago contract in early 2003, while Finley was then Redflex’s vice president of operations. In the course of the competition, Finley learned that John Bills, who was then an assistant Chicago transportation commissioner in charge of the city’s red-light camera program, was championing Redflex by providing pointers and inside information to Redflex, the plea agreement states.
After Redflex was awarded its first Chicago contract in approximately late May 2003, Finley hired Bills’ friend Martin O’Malley as a contractor for Redflex, in an effort to ensure that Bills would continue to provide assistance to Redflex in future contract negotiations with the city. Finley admitted in the plea agreement that she knew O’Malley was a friend of Bills and that it was important to Bills that Redflex hire him. Finley personally signed O’Malley’s contract, which included provisions for lucrative increases in O’Malley’s compensation as new red-light cameras were added, according to the plea agreement.
After Finley became CEO of Redflex in 2007, O’Malley’s commissions escalated and Bills continued to assist the company, including having at least one red-light contract “sole-sourced” to Redflex, the plea agreement states. Finley states in the plea agreement that she knew Redflex was also paying personal expenses for Bills in order to buy his influence and expand Redflex’s business with the city. These expenses included meals, golf outings, rental cars, airline tickets to Phoenix, rooms at the Biltmore Hotel and other entertainment, according to the plea agreement.
Redflex’s technology uses cameras to automatically record and ticket drivers who run red lights. Between 2004 and 2008, the city paid Redflex approximately $25 million, according to the indictment against Finley, Bills and O’Malley. Bills was a voting member of the city’s Request For Proposal evaluation committee that recommended awarding the contracts to Redflex, the indictment states. In February 2008, the city awarded the “sole-sourced” contract to Redflex, paying the company approximately $33 million, according to the indictment. The city followed up that contract with another one the same month – agreeing to pay Redflex approximately $66 million for the installation of nearly 250 additional red-light cameras.
Bills, 54, of Chicago, was indicted on nine counts of mail fraud, three counts of wire fraud, three counts of federal program bribery, three counts of filing a false federal income tax return, and one count each of extortion and conspiracy to commit federal program bribery. He has pleaded not guilty and is scheduled to proceed to trial on Jan. 11, 2016, before Judge Kendall. Bills retired from the city in 2011.
O’Malley, 74, of Worth, pleaded guilty in December to one count of conspiracy to commit bribery in a federal program. No sentencing date has been set.
The government is represented by Assistant United States Attorney Laurie J. Barsella.
Plea Agreement
Former President of the Park Avenue Bank Sentenced to 30 Months in Prison for Role in Fraud of Government Relief Funds, Self-Dealing, Bank Bribery, Embezzlement of Bank Funds, and Fraud Involving an Insurance CompanyRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that CHARLES ANTONUCCI, SR., the former president and chief executive officer of The Park Avenue Bank, was sentenced today to 30 months in prison for his involvement in a massive fraud involving self-dealing, bank bribery, embezzlement of bank funds, attempting to fraudulently obtain more than $11 million worth of taxpayer rescue funds from the Troubled Asset Relief Program (“TARP”), and participating in a $37.5 million fraud scheme that left an Oklahoma insurance company in receivership. ANTONUCCI pled guilty pursuant to a cooperation agreement with the government in October 2010 before U.S. District Judge Naomi Reice Buchwald, who imposed today’s sentence. Yesterday, Judge Buchwald sentenced Matthew L. Morris, a former senior vice president of the Bank, who also pled guilty pursuant to a cooperation agreement, to one year and one day in prison.
ANTONUCCI was the first defendant convicted of fraud of TARP funds, a program whose purpose was to provide funds to viable financial institutions to stabilize and strengthen the nation’s financial system, and to enable those financial institutions to increase the flow of financing to U.S. businesses and consumers.
According to the Information, Complaint, sentencing submissions, and statements made during court proceedings:
Background
The Park Avenue Bank (the “Bank”) was a federally insured and state-chartered bank that was headquartered on Park Avenue, New York, New York. The Bank’s clients consisted primarily of small businesses, for which the Bank made loans, extended lines of credit, and maintained depository accounts. As of the end of 2009, the Bank had approximately $500 million on deposit, and over $520 million in assets. ANTONUCCI served as president and chief executive officer (“CEO”) of the Bank from June 2004 to October 2009, and also served on its Board of Directors. During this period, and as part of the fraudulent schemes for which he was convicted and sentenced, ANTONUCCI maintained a corrupt relationship with Wilber Anthony Huff, a Kentucky-based businessman, and Morris, the senior vice president of the Bank.
The Schemes
From 2006 through 2010, ANTONUCCI, Morris, and Huff engaged in a massive multifaceted conspiracy, in which they schemed to (i) receive and pay bank bribes, (ii) engage in self-dealing; (iii) defraud bank regulators and the board and shareholders of a publicly traded company, and (iv) fraudulently purchase an Oklahoma insurance company.
Bank Bribery
From 2007 to 2009, Huff paid ANTONUCCI and Morris at least $400,000 in exchange for which they: (i) provided Huff with fraudulent letters of credit obligating the Bank to pay an investor in one of Huff’s businesses $1.75 million if Huff failed to pay the investor back himself; (ii) allowed certain of Huff’s beneficially owned businesses to accrue $9 million in overdrafts; (iii) facilitated intra bank transfers in furtherance of certain of Huff’s other frauds; and (iv) fraudulently caused the Bank to issue at least $4.5 million in loans to Huff’s beneficially owned businesses.
In particular, ANTONUCCI and Morris accepted bribes from Huff, including but not limited to hundreds of thousands of dollars of cash bribes, free use of Huff’s airplane, and free use of another customer’s luxury automobile. On more than 10 occasions in 2008 and 2009, ANTONUCCI used a private plane owned by Huff to fly to, among other places, Florida, Panama, Arizona (so that ANTONUCCI could attend the Super Bowl), and Augusta, Georgia (so that ANTONUCCI could attend the Masters Golf Tournament).
Self-Dealing
ANTONUCCI also engaged in a pattern of self-dealing in connection with his position as President and CEO of the Bank. For example, ANTONUCCI, among other things, approved a $400,000 loan through the Bank to an entity he controlled called Easy Wealth, through which ANTONUCCI obtained tens of thousands of dollars in proceeds. ANTONUCCI also had the Bank pay rent to him for one or more properties that ANTONUCCI owned and which the Bank did not use, including a property in Fishkill, New York, and directed Bank employees to perform substantial work on non-Bank matters in which he had personal financial interests.
Fraud on Bank Regulators and a Publicly Traded Company
From 2008 to 2009, ANTONUCCI, Morris, and Huff engaged in a scheme to prevent the Bank from being designated as “undercapitalized” by regulators – a designation that would prohibit the Bank from engaging in certain types of banking transactions, and that would subject the Bank to a range of potential enforcement actions by regulators. Specifically, they engaged in a series of deceptive, “round-trip” financial transactions to make it appear that ANTONUCCI had infused the Bank with $6.5 million in new capital when, in actuality, the $6.5 million was part of the Bank’s pre-existing capital. ANTONUCCI, Morris, and Huff funneled the $6.5 million from the Bank through accounts controlled by Huff to ANTONUCCI. This was done to make it appear as though ANTONUCCI was helping to stabilize the Bank’s capitalization problem, so the Bank could continue engaging in certain banking transactions that it would otherwise have been prohibited from doing, and to put the Bank in a better posture to receive $11 million from the TARP. To conceal their unlawful financial maneuvering, Huff created, or directed the creation of, documents falsely suggesting that ANTONUCCI had earned the $6.5 million through a transaction involving another company ANTONUCCI owned. When the Bank’s regulators began investigating the source of the purported $6.5 million capital infusion, ANTONUCCI lied to them about the true nature of the transaction. ANTONUCCI, Morris, and Huff further concealed their scheme by stealing $2.3 million from General Employment Enterprises, Inc. (“GEE”), a publicly traded temporary staffing company, in order to pay the Bank back for monies used in connection with the $6.5 million transaction. In order to conceal this transaction, ANTONUCCI caused a counterfeit certificate of deposit (“CD”) to be created by the Bank, making it appear that GEE’s $2.3 million had been invested in a CD at the Bank.
Fraud on Insurance Regulators and the Investment Firm
From July 2008 to November 2009, ANTONUCCI, Morris, Huff, and Allen Reichman, an employee at an investment bank and financial services company headquartered in New York, New York (the “Investment Firm”), conspired to (i) defraud Oklahoma insurance regulators into allowing ANTONUCCI to purchase the assets of Providence P&C (the Oklahoma insurance company), and (ii) defraud the Investment Firm into providing a $30 million loan to finance the purchase. Specifically, ANTONUCCI and Huff devised a scheme in which ANTONUCCI would purchase Providence P&C’s assets by obtaining a $30 million loan from the Investment Firm, which used Providence P&C’s own assets as collateral for the loan. However, because Oklahoma insurance regulators had to approve any sale of Providence P&C, and because Oklahoma law forbade the use of Providence P&C’s assets as collateral for such a loan, ANTONUCCI, Morris, Huff, and Reichman made, and conspired to make, a number of material misstatements and material omissions to the Investment Firm and Oklahoma insurance regulators concerning the true nature of the financing for ANTONUCCI’s purchase of Providence P&C. Among other things, Reichman directed ANTONUCCI to sign a letter that provided false information regarding the collateral that would be used for the loan, and ANTONUCCI, Morris, and Huff conspired to falsely represent to Oklahoma insurance regulators that the Bank – not the Investment Firm – was funding the purchase of Providence P&C.
After deceiving Oklahoma regulators into approving the sale of Providence P&C, Huff took $4 million of the company’s assets. Ultimately, in November 2009, the insurance company became insolvent and was placed in receivership after ANTONUCCI, Morris, and Huff had pilfered its remaining assets.
* * *
In addition to the prison sentence, ANTONUCCI, 64, of Woodside, New York, was also ordered to forfeit $11.2 million to the United States and to provide more than $54 million in restitution to victims of his crimes, including, among others, the Federal Deposit Insurance Corporation (“FDIC”).
Huff, who pled guilty to his role in the above-described offense and other interrelated frauds in December 2014, was sentenced by Judge Buchwald on June 4, 2015, to 12 years in prison. Reichman, who pled guilty to his role in the Providence P&C scheme in February 2015, was sentenced by Judge Buchwald on July 15, 2015, to 21 months in prison.
Mr. Bharara praised the investigative work of the Special Inspector General for the Troubled Asset Relief Program, the Federal Bureau of Investigation, the IRS, the New York State Department of Financial Services, Immigration and Customs Enforcement’s Homeland Security Investigations, and the Office of Inspector General of the FDIC. Mr. Bharara also thanked the Department of Justice’s Tax Division and the United States Attorney’s Office for the Southern District of Florida for their assistance.
The charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.
The case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Janis Echenberg and Daniel Tehrani are in charge of the criminal case.
Former Oklahoma State Senator Pleads Guilty to Wire Fraud and Tax EvasionRead the Press Release
TULSA, Okla.—Former Oklahoma State Senator Ricky L. Brinkley pleaded guilty today to fraudulently obtaining over $1.2 million dollars from the Better Business Bureau (“BBB”) and subscribing to a false tax return.
United States Attorney Danny C. Williams Sr. of the Northern District of Oklahoma; FBI Special Agent in Charge Scott L. Cruse of the Oklahoma City Division; IRS-Criminal Investigation Acting Special Agent in Charge Madie Branch of the Dallas Field Office; and Director Stan Florence of the Oklahoma State Bureau of Investigation made the announcement.
Brinkley, 54, of Owasso, Oklahoma, pleaded guilty before U.S. District Court Judge Claire V. Eagan to five-counts of wire fraud and one-count of subscribing to a false tax return. Sentencing is scheduled on November 20, 2015. Brinkley represented the 34th District, including Owasso, Collinsville, Skiatook, Sperry, Turley, and Tulsa.
From August 2, 1999 to April 26, 2015, Brinkley served as the President and Chief Executive Officer and then the Chief Operations Officer of the Better Business Bureau (BBB). During his employment, Brinkley was responsible for the operation, accounting, and financial management including paying bills and signing checks on behalf of the BBB.
According to admissions made in connection with his guilty plea, from November 2005 to February 2015, Brinkley diverted in excess of $1.2 million dollars from the BBB through the creation of fraudulent invoices for services not rendered, and improperly represented these invoices as reimbursement for legitimate BBB expenses. He also admitted that he fraudulently signed checks, transferred, used, and disbursed BBB funds to pay personal expenses and debts including mortgage payments, expenses for pool cleaning services at his home, and his personal American Express, Discover, and Visa cards. Brinkley further admitted that he used BBB’s credit card to make cash withdrawals at automated teller machines located within casinos to support his gambling habit and that he would also create and process for payment false invoices using BBB’s funds for payment. The United States believes the loss amount is closer to $1.8 million. Final loss and restitution amounts will be determined prior to sentencing.
In addition to the fraudulent diversion of funds from the BBB, Brinkley admitted that he failed to report the monies and funds on his federal tax return and that he subscribed a false tax return for tax year 2013 by failing to report approximately $148,390 in income.
United States Attorney Williams stated that, “non-profit organizations such as the BBB provide the community with resources to make informed decisions in the marketplace. The BBB’s vision is ‘an ethical marketplace where buyers and sellers trust each other.’ Brinkley has abused the trust of the BBB board, its business members, marketplace consumers, and the trust the public has placed in him. BBB has worked with federal and state agencies by identifying the diverted funds. I hope this investigation and conviction is a step towards strengthening the trust of BBB members and consumers, and will allow BBB to continue to provide valuable services to the community.”
FBI Special Agent in Charge Cruse stated that, “criminal investigations against those holding positions of public trust are never easy, but they are among some of the most important cases that we do in the FBI. That is because we hold our public servants to a higher standard. Our citizens expect their public servants to uphold the law in all aspects of their lives, whether it be in connection with their public responsibilities or in their personal endeavors. The FBI, along with our law enforcement partners, will continue to aggressively target those entrusted by organizations to manage their funds who choose to exploit this trust for their personal gain.”
IRS-CI Acting Special Agent in Charge Branch stated that, “although the BBB emphasizes high ethical standards, honesty, and legal compliance for themselves and their business partners, Mr. Brinkley chose to violate each of these tenets by conducting himself in a financially irresponsible manner. Filing a false income tax return is totally unfair to those American citizens who file accurate tax returns, and is inconsistent with his background as a public servant. However, the public can be confident in the fact that IRS-Criminal Investigation pursues justice on their behalf in seeking prosecution of anyone, regardless of status, who violates the tax laws.”
"Late last year, OSBI developed information indicating potential crimes were committed from within the Tulsa BBB. Once OSBI opened a criminal investigation at the request of Tulsa County D.A. Steve Kunzweiler, it became apparent federal laws may also have been broken. OSBI appreciates the FBI and IRS's willingness to work with OSBI agents to ensure justice, both on the federal and state levels, is served," OSBI Director Stan Florence said.
Brinkley faces a maximum penalty of 20 years in prison and a $250,000 fine, or twice the pecuniary gain/loss caused by the defendant’s acts for the wire fraud charges; and the maximum penalty is three years in prison and a $250,000 fine for the filing of a false tax return. Brinkley has also agreed to the forfeiture of funds in the amount of $1,829,033.86 representing proceeds of the wire fraud scheme.
The case was investigated by the Federal Bureau of Investigation, the Internal Revenue Service-Criminal Investigation, and the Oklahoma State Bureau of Investigation. This case is being prosecuted by Assistant United States Attorneys Clinton J. Johnson, Clemon Ashley, Shannon Cozzoni, and Catherine Depew.
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Former Florida Highway Patrol Trooper Sentenced for Taking BribesRead the Press Release
Kirk Chambers, a former Trooper with the Florida Highway Patrol (FHP), was sentenced today before U.S. District Court Judge Cecilia Altonaga for his participation in a bribery scheme.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida and George L. Piro, Special Agent in Charge, Federal Bureau of Investigation, (FBI), Miami Field Office, made the announcement.
On August 20, 2015, U.S. District Court Judge Cecilia Altonaga sentenced former FHP Trooper Kirk Chambers to 51 months’ imprisonment. Chambers had previously pleaded guilty to violation of 18 U.S.C. § 1951(a), that is, participating in a conspiracy to affect commerce through extortion under color of law. Chambers’ co-conspirator in the offense, Guillermo “Tony” Sepulveda was previously sentenced by Judge Altonaga to 37 months imprisonment on August 4, 2015.
According to the facts set forth in court documents, Chambers was employed as a sworn FHP Trooper between 2006 and 2015. In 2013, the FBI and local law enforcement agencies opened an investigation into allegations that South Florida law enforcement personnel were being paid bribes by local wrecker operators to illegally solicit business from stranded drivers at accident scenes. Chambers was one of the officers identified as taking bribes.
In 2014, an FBI confidential source (CHS) approached Guillermo “Tony” Sepulveda, the owner and operator of a local Miami based towing company. Under FBI direction, the CHS told Sepulveda that he had a corrupt “chiropractor” that was interested in purchasing confidential accident information from law enforcement in order to permit the chiropractor to illegally solicit business from the accident victims. Sepulveda agreed to participate and introduced the CHS to Trooper Chambers.
Between September and November 2014, Chambers used his position to download the personal information of approximately 100 accident victims from FHP servers. Chambers provided that information to the CHS in return for $5,000, during a series of transactions. For his part in the conspiracy, Sepulveda was paid $1,200.
On January 22, 2015, Chambers was interviewed by the FBI and admitted participating in the bribery scheme. Chambers also admitted being paid thousands of dollars in bribes by various tow truck operators for a number of years.
Mr. Ferrer commended the investigative efforts of the FBI Miami Area Corruption Task Force, Florida Division of Insurance Fraud and the Florida Highway Patrol. This case is being prosecuted by Assistant U.S. Attorney Anthony Lacosta.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Florida Man Sentenced to 84 Months for Role in Conspiracy to Distribute HeroinRead the Press Release
LEXINGTON - A Florida man, who supplied a network of drug traffickers in Mt. Sterling, Ky., with heroin, has been sentenced to 84 months in federal prison.
On Wednesday, U.S. District Judge Danny C. Reeves sentenced 33 year-old Alvin Jason Givens for conspiracy to distribute at least 100 grams of heroin. Under federal law, Givens must serve at least 85 percent of his prison sentence. Givens is the last of 11 defendants involved in the conspiracy to be sentenced. The leader of the Mt. Sterling drug trafficking organization, Jeffrey Wingate, was sentenced earlier this year to 150 months in federal prison.
According to Givens’ plea agreement, from September 2013 until June 2014, Givens supplied Wingate with heroin, as well as oxycodone pills, to bring back to Kentucky and distribute. During the conspiracy, Wingate made several trips to Florida to acquire both oxycodone pills and heroin. In addition to the heroin, Givens was also responsible for the illegal distribution of 20,000 oxycodone pills, which was considered in determining his sentence.
Kerry B. Harvey, U.S. Attorney for the Eastern District of Kentucky; Howard S. Marshall, Special Agent in Charge, FBI; Rodney C. Brewer, Commissioner, Kentucky State Police; David Charles, Chief, Mt. Sterling Police Department; and Fred Shortridge, Montgomery County Sheriff, jointly made the announcement today.
The investigation was conducted by the FBI, Kentucky State Police, the Mt. Sterling Police Department and the Montgomery County Sheriff’s Office. Assistant U.S. Attorney Robert M. Duncan Jr. prosecuted this case on behalf of the federal government.
Five North Shore Individuals Charged with Oxycodone DistributionRead the Press Release
BOSTON – Five individuals were charged in U.S. District Court in Boston with distributing oxycodone throughout the North Shore.
Joseph Romano, 38, of Peabody; Anthony Panarese, 35 of Peabody; Paul Williams, 51, of Malden; David Turner, Sr., 55, of Peabody; and Ashley Turner, 26, of Peabody, where arrested this morning and charged with one count of conspiracy to possess with intent to distribute and distribution of oxycodone, a highly-addictive controlled substance used to treat severe pain.
According to the criminal complaint, since March 2014, the defendants conspired to distribute oxycodone. Physical and court-authorized electronic surveillance (i.e., wiretaps and GPS tracking devices) were used to establish that Panarese and Williams were supplying Romano with oxycodone nearly every week. David Turner, Sr. and Ashley Turner were oxycodone pill customers of Romano who also redistributed oxycodone pills supplied by Romano or one of Ramono’s suppliers, such as Williams, to “street” oxycodone users. During the investigation, law enforcement officers completed controlled purchases and seized approximately 950 oxycodone pills from the defendants.
The charging statute provides for a sentence of no greater than 20 years in prison, a lifetime of supervised release, and a fine of $1 million. 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; Michael J. Ferguson, Special Agent in Charge of the Drug Enforcement Administration, Boston Field Office; Colonel Richard D. McKeon, Superintendent of the Massachusetts State Police; Peabody Police Chief Thomas M. Griffin; and Danvers Police Chief Patrick Ambrose, made the announcement today. The case is being prosecuted by Assistant U.S. Attorneys Carlos A. López and James E. Arnold of Ortiz’s Narcotics and Money Laundering Unit.
The details contained in the charging document are allegations. The defendants are presumed to be innocent unless and until proven guilty beyond a reasonable doubt in the court of law.
Felon in Possession of Firearm Receives Prison TermRead the Press Release
A man who unlawfully possessed a firearm was sentenced August 19, 2015, to nearly four years in federal prison.
Dustin Dimmick, 26, from Tucson, Arizona, received the prison term after an April 23, 2015, guilty plea to felon in possession of a firearm. Dimmick was previously convicted of possession of a controlled substance, a felony, in the Fall River County District Court for South Dakota, on or about April 20, 2012.
At the guilty plea, Dimmick admitted that in 2013, he and others traded and/or bought/sold guns with other persons. On or about December 11, 2013, in Swea City (Kossuth County), Iowa, Dimmick and other persons participated in the burglary of a residence. During this burglary, or shortly thereafter, Dimmick took possession of at least two firearms, two mini dirt bikes and several pool cues. Sometime shortly after December 11, 2013, in Rolfe (Palo Alto County) Iowa, Dimmick sold and/or traded several items of property to another person, including one of the stolen mini bikes, and two stolen firearms, namely, a JGA .22 caliber rifle, Model Karabiner, serial number 520404; and a 9mm Browning handgun, Model Herstal Belgique, serial number 51905.
Dimmick was sentenced in Sioux City by United States District Court Judge Mark W. Bennett. Dimmick was sentenced to 46 months’ imprisonment. A special assessment of $100 was imposed. He must also serve a 3-year term of supervised release after the prison term. There is no parole in the federal system. Dimmick is being held in the United States Marshal’s custody until he can be transported to a federal prison.
This case is being prosecuted as part of Project Safe Neighborhoods, a cooperative local, state and federal program aimed at the enhanced prosecution of gun crimes. The case was prosecuted by Assistant United States Attorney Shawn S. Wehde and investigated by the Kossuth County Sheriff’s Office, the Palo Alto County Sheriff’s Office, and the Bureau of Alcohol, Tobacco and Firearms (ATF).
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 15-3041.
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Eight Area People Sentenced on Fraud Charges Involving Motor Vehicle TitlesRead the Press Release
St. Louis, MO – RANDALL HINTON was the leader of a scheme to alter and counterfeit documents in order to obtain state issued motor vehicle titles for himself and others, and to obtain loans secured by motor vehicle titles. Hinton, of St. Louis, Missouri, was sentenced on August 11 to 136 months in prison; co-defendant JUSTIN CARTER, also of St. Louis, Missouri, was sentenced yesterday afternoon to 60 months in prison. Six other co-defendants have been sentenced earlier this summer to sentences ranging from five years of probation to 37 months in prison.
According to court documents, the schemes involving the defendants resulted in financial losses to the State of Missouri, financial institutions, title loan companies and individuals. As the documents were often altered to decrease the value of the vehicles or to change the state of residence of the vehicle owners to addresses in Illinois, the owners of the vehicles were able to evade paying the appropriate taxes and license fees to the Department of Revenue for the State of Missouri. When Hinton removed the names of financial institutions which had financed the purchases of the vehicles from legitimate titles, Hinton and others were able to sell the vehicles to innocent purchasers, who were then unable to register the vehicles due to existing liens.
The final aspect of the scheme enabled individuals to use the altered documents to obtain motor vehicle title loans from companies located throughout the United States. As a result of existing liens or the fact that the value of the vehicles was less than the defendants represented, the title loan companies experienced large financial losses. Due to the removal of the names of the true lienholders for the documents, government analysts were only able to identify actual losses, which exceeded $311,000. However, due to the number of vehicles that the government was able to identify as being used in the fraudulent scheme, the loss estimate was as high as $1,000,000.
This case was investigated by the United States Postal Inspection Service, the State of Missouri Department of Revenue, the State of Illinois Secretary of State and the St. Louis Metropolitan Police Department. Assistant United States Attorney Tracy Berry is handling the case for the U.S. Attorney's Office.
Defendants Sentenced for Roles in Marijuana Distribution ConspiracyRead the Press Release
ABILENE, Texas — All six defendants who were convicted for their respective roles in a marijuana distribution conspiracy have been sentenced, announced U.S. Attorney John Parker of the Northern District of Texas.
Today, Fabricio Abelardo Perez, 43, of Abilene, Texas, was sentenced by Chief U.S. District Judge Jorge A. Solis to 156 months in federal prison. Earlier this week, Judge Solis sentenced Daniel Longoria, 49, also of Abilene, to 360 months in federal prison. Perez pleaded guilty to his role in the conspiracy and Longoria was convicted at trial in February 2015.
In June 2015, Judge Solis sentenced Abilene residents Jose Cavazos, 52, to 108 months in federal prison; Travis Kyndall Longoria, 23, to 120 months in federal prison; and David Rodriguez, 26, to 30 months in federal prison. Brandon Johnson, 36, of Sweetwater, Texas, was sentenced to 90 months in federal prison.
Daniel Longoria, Cavazos, and Travis Longoria were each convicted at trial on an indictment charging one count of conspiracy to distribute and possess with intent to distribute 100 kilograms or more of marijuana. Rodriguez was found guilty at trial of the lesser charge of conspiracy to distribute and possess with intent to distribute less than 50 kilograms of marijuana. In January 2015, Perez and Johnson each pleaded guilty to the indictment.
According to evidence presented at trial and filed court documents, the investigation into the Daniel Longoria Drug Trafficking Organization (DTO) began when the Abilene Police Department learned that, since 2004, Daniel Longoria had been distributing marijuana from his business, Abilene Automotive and Performance. Daniel Longoria concealed marijuana in speaker boxes, and placed the speakers in vehicles so that the marijuana could be distributed throughout Abilene. Daniel Longoria also used vehicles that had been left at his business to conceal and transport large sums of bulk cash back to the DTO’s supply source in Mexico. All six defendants conspired together and worked together to transport and distribute large quantities of marijuana in Abilene.
The Abilene Police Department, the Texas Department of Public Safety and U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) investigated. Assistant U.S. Attorney Juanita Fielden and Deputy Criminal Chief Assistant U.S. Attorney Denise Williams prosecuted.
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