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24 September 2015
Twelve Charged in Scheme that Allowed Georgia Inmates to Sell Drugs and Defraud Consumers from Inside PrisonRead the Press Release
ATLANTA – Two former Georgia Department of Corrections (GDOC) employees, four current Georgia state inmates, three recently paroled inmates, and three others have been charged federally with drug trafficking, extortion, wire fraud conspiracies, wire fraud, and identity theft offenses, as detailed in two indictments unsealed today. Much of the criminal conduct allegedly was committed inside Georgia state prisons.
“Prisons serve to punish and rehabilitate convicted offenders and deter crime—not enable it,” said U.S. Attorney John Horn. “These indictments allege that, after being placed in prison to protect society from their criminal behavior, these inmates capitalized on their ready access to cell phones and other contraband to further victimize citizens outside the prisons. Prisons should be a place where we have confidence that inmates are not operating identity theft schemes and drug distribution rings.”
“The federal indictments and arrests of these individuals represent not only the larger problems posed by contraband such as cell phones in prisons, but also the joint law enforcement effort to address it,” said J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office. “The FBI will continue to work with its state partners, to include the Georgia Department of Corrections, in addressing the many unique challenges facing correctional facilities and those that work within them”.
“Criminals who are able to operate inside correctional facilities and conduct this level of criminal activity are a direct threat to the safety of the public. The GBI is fully committed to working with the Georgia Department of Corrections and the Federal Bureau of Investigation to address this type of crime,” said Vernon Keenan, Director, Georgia Bureau of Investigation.
According to U.S. Attorney Horn, the charges and other information presented in court: As alleged in the indictments, the wide-ranging conspiracy involved GDOC employees at Phillips and Valdosta State Prisons who helped smuggle cell phones and other contraband to inmates in exchange for bribe payments. These cell phones were often equipped with touch screens and internet access that enabled the prisoners to coordinate drug transactions, commit identity theft and credit card fraud, and even post on social media and buy products online.
According to the indictment, the charged GDOC employees allegedly helped smuggle methamphetamine, prescription pain medication, marijuana, liquor, tobacco, and take-out food into the prisons. At times, the inmates even bragged about watching streaming movies while in solitary confinement. In one instance, an inmate allegedly used his contraband cell phone to arrange a “hit” on another inmate whom he suspected of cooperating with law enforcement.
The following individuals were arrested today, and most of the defendants made their initial appearances before United States Magistrate Judge Janet F. King:
Former GDOC employees who were charged are:
- Anekra Artina Williams, 20, of Nashville, Georgia, was a GDOC guard at Valdosta State Prison, in Valdosta, Georgia. Williams has been charged with one count of conspiring to distribute at least 50 grams of methamphetamine; one count of distributing methamphetamine; and one count of conspiring to interfere with commerce by extortion.
- Charonda Edwards, a/k/a “John,” 29, of Decatur, Georgia, was a kitchen worker at Phillips State Prison, in Buford, Georgia. Edwards has been charged with one count of conspiring to distribute methamphetamine and marijuana; and one count of interfering with commerce by extortion.
The current GDOC inmates who were charged are:
- Donald Howard Hinley, 51, was an inmate at Valdosta State Prison prior to his arrest, has been charged with one count of conspiring to distribute at least 50 grams of methamphetamine; one count of distributing at least 50 grams of methamphetamine; and three counts of distributing methamphetamine.
- Mims Morris, 24, who was an inmate at Phillips State Prison prior to his arrest, has been charged with one count of conspiring to distribute methamphetamine and marijuana; two counts of conspiring to commit wire fraud; two counts of committing wire fraud; and two counts of aggravated identity theft.
- Johnathan Silvers, a/k/a “Turtle,” 28, who was an inmate at Phillips State Prison prior to his arrest, has been charged with one count of conspiring to distribute methamphetamine and marijuana.
- Adam Smith, 30, who was an inmate at Phillips State Prison prior to his arrest, has been charged with one count of conspiring to distribute methamphetamine and marijuana.
The paroled GDOC inmates who were charged are:
- Ruben Ruiz, a/k/a “Flaco” and “Scrappy,” 34, of Gainesville, Georgia, has been charged with one count of conspiring to distribute at least 50 grams of methamphetamine. Ruiz was paroled in March 2014 from GDOC custody after serving a 10-year sentence.
- William A. Matthews, a/k/a “Two Young,” 30, of Union City, Georgia, has been charged with one count of conspiring to distribute at least 50 grams of methamphetamine; and one count of distributing methamphetamine. Matthews was paroled in August 2014 from GDOC custody after serving a 10-year sentence.
- Kansas Bertollini, a/k/a “Guido,” 35, of Kathleen, Georgia, has been charged with one count of conspiring to distribute at least 50 grams of methamphetamine; and one count of distributing at least 50 grams methamphetamine. Bertollini was paroled in June 2014 from GDOC custody after serving an 11-year sentence.
The other individuals who were charged are:
- Tiffany Allen, 27, of Cleveland, Georgia, has been charged with two counts of conspiring to commit wire fraud; and two counts of aggravated identity theft.
- Monique Kinney, a/k/a Monique Reed, 26, of Augusta, Georgia. Kinney was charged with one count of conspiring to commit wire fraud; and one count of aggravated identity theft.
- Opal Marie Hayden, 58, of Acworth, Georgia, has been charged with one count of conspiring to distribute at least 50 grams of methamphetamine; and three counts of distributing methamphetamine.
Valdosta State Prison
The GDOC is an agency of the State of Georgia and responsible for overseeing the operations of state prisons. Over 55,000 inmates are incarcerated in Georgia state prisons. According to the indictment, GDOC inmates increasingly obtain and use cellular telephones to further their criminal activities while incarcerated. Among other things, cellular telephones are used to traffic drugs, commit fraud schemes, and organize criminal activity both inside and outside of prison. Inmates regularly buy and sell cellular telephones inside of prison, many of which are the latest models.
The first of two indictments focuses on Valdosta State Prison (VSP), which is located in Valdosta, Georgia, and houses adult male inmates. Donald Hinley was an inmate at VSP.
The Smuggling Scheme
The indictment alleges that inmates typically relied on prison employees to smuggle cellular telephones and other contraband into VSP. In 2014 and 2015, Hinley routinely arranged to have telephones, cigarettes, liquor, prescription pain medication, and illegal drugs smuggled into the prison by prison employees. Anekra Williams was a GDOC corrections officer who allegedly smuggled contraband into VSP in exchange for bribe payments. The indictment alleges that Williams smuggled drugs, tobacco and other items requested by inmates into VSP. On one such occasion, Williams allegedly smuggled methamphetamine and prescription pain medication into the prison for Hinley in exchange for $500. In order to assist with the smuggling scheme, Hinley allegedly arranged to have the contraband packaged in a manner to avoid detection by other prison security officers.
Drug Trafficking from Inside Prison
The indictment alleges that while an inmate at VSP, Hinley coordinated a network of illegal drug suppliers and couriers, from August 2014 through April 2015 that included, among others, Opal Marie Hayden, Ruben Ruiz, William Matthews, Kansas Bertollini, and Williams. With their assistance, Hinley allegedly brokered a number of significant drug transactions in Atlanta and in other areas of Georgia. On multiple occasions, Hinley coordinated the purchase and sale of illegal narcotics by cell phone. In recorded telephone calls, Hinley allegedly bragged “We have good prices and good product.”
The indictment also alleges that in one encounter, Hinley used his contraband cell telephone to call an inmate he knew at Telfair State Prison (TSP) and instructed his associate to kill another TSP prisoner after Hinley confirmed that the inmate was “a snitch” and was likely a prosecution witness against Hinley’s girlfriend. At the time, Hinley’s girlfriend worked as a drug courier in Hinley’s drug organization and was a defendant in a state narcotics case. Hinley allegedly ordered his associate to “shoot every one” of the witness’ family members. Immediately after law enforcement learned of Hinley’s plan, the cooperating inmate was placed in protective custody.
Phillips State Prison
The second indictment focuses on Phillips State Prison (PSP), which is located in Buford, Georgia, and houses adult male inmates. Mims Morris (Morris), Johnathan Silvers (Silvers), and Adam Smith (Smith) were inmates at PSP and were members of the Ghostface Gang. The indictment alleges that while they were inmates at PSP, both Morris and Silvers allegedly obtained cellular telephones and used them to traffic drugs and commit fraud. Morris and Silvers even obtained cellular telephones while they were in segregated custody, charging the devices using the light fixtures in their cells. Silvers allegedly bragged that his cellmate was watching a movie on his cellular telephone while they were in the “hole” together. In a recorded telephone call, Morris talked about posting on Facebook and buying shoes on the Internet. Morris boasted that the guards all knew he had a cellular telephone in segregated confinement.
The indictment also alleges that Tiffany Allen (Allen) and Monique Kinney (Kinney) assisted Morris by using stolen identities to commit fraud. Allen and Kinney communicated with Morris by cellular telephone while he was an inmate at PSP.
The Smuggling Scheme
The indictment alleges that, like VSP, inmates relied on prison employees to bring in cellular telephones and other contraband to PSP. Charonda Edwards (Edwards) was a GDOC contract employee who worked in the kitchen at the prison. Edwards allegedly obtained drugs, tobacco, and other items requested by Silvers in exchange for payment. Edwards then smuggled the items into prison and hid them so the inmates could pick up the contraband. Edwards also allegedly provided valuable information to Silvers in the process such as when the prison would be “locked down.”
Morris, Silvers, and Edwards allegedly relied on prison orderlies and other inmates inside PSP to move drugs, cellular telephones and other items throughout the prison. Morris and Silvers sold the smuggled drugs and contraband to other inmates. In one recorded call, Silvers said that, even though they were in the “hole,” he had food, cigarettes and marijuana, and even expected to get methamphetamine in the near future. Silvers paid Edwards using reloadable prepaid credit cards.
Fraud and Theft from Inside Prison
The indictment alleges that from June 2014 to September 2014, Morris allegedly used his contraband cellular telephone to perpetuate various fraud schemes from inside prison with the assistance of associates on the outside, including Kinney and Allen. The targeted victims were credit card companies and their customers, and job-seekers responding to online advertisements for work.
The Credit Card Scheme
The indictment alleges that on August 26, 2014, Morris called victim “B.T.,” pretending to be a Discover Card representative, working in the “Fraudulent Specialist Department.” He informed B.T. that there were fraudulent charges on her credit card and he needed her credit card number to verify her identity. At his urging, B.T. eventually provided her credit card number to Morris.
While pretending to be B.T., Morris allegedly called a Discover Card representative and was able to access her Discover card account. During the call, Morris used B.T.’s Social Security number and credit card number to authorize a $2,200 transfer to another credit card Morris controlled. Later, Morris allegedly pretended he was B.T. and asked the representative to change the telephone number on the account because he was going to be out of town for several weeks. The Discover representative changed the telephone number to Morris’s prison cell phone. On September 3, 2014, Morris allegedly used B.T.’s information to apply for additional credit cards. With the help of Kinney, Morris was approved for a Capital One Platinum Card using B.T.’s personal information.
The Fake Employment Scheme
On August 31, 2014, Morris texted Allen, telling her he wanted to act as though he was hiring people. Morris allegedly explained that he would obtain personal information from people seeking work and then would order debit cards in their names, using their personal information. Morris commented to Allen that it was “easy as pie” to get someone’s personal information.
The indictment alleges Morris directed Allen to post a fraudulent advertisement on Craigslist.com for job applicants for non-existent construction and roofing jobs. Morris provided a fake company name and an address in Sacramento, California, and even provided his cellular telephone in prison as the telephone number for the fake company so the victims would call him directly and provide their personal information. Allen allegedly attempted to post this information on Craigslist for Morris.
Prison Investigation Also Uncovers Illegal Machinegun Sales
During the federal investigation, FBI agents learned that a woman, later identified as Tiffany Goodson, 34, of Toccoa, Georgia, telephoned an inmate at Jenkins Correctional Center, a privately owned state prison in Millen, Georgia. The inmate received Goodson’s telephone call on a contraband prison cell phone. During that call, Goodson, a convicted felon, allegedly informed the inmate that she knew a man who was willing to build and sell fully automatic machineguns. This inmate later cooperated with federal authorities.
When that information reached the FBI, federal agents identified Goodson and used an undercover agent to purchase two machineguns from her. The agents also identified Goodson’s gun supplier as Robert Burns, 30, of Wahalla, South Carolina. On February 15, 2015, during an undercover operation arranged by the FBI, Mr. Burns drove from South Carolina to Stephens County, Georgia, where he sold Goodson a fully automatic rifle with an obliterated serial number for $2,500.
On July 7, 2015, Goodson and Burns were indicted by a federal grand jury for their roles in a conspiracy to sell illegal machineguns. Earlier today, Mr. Burns pleaded guilty before Senior U.S. District Court Judge Orinda D. Evans. During his plea hearing, Mr. Burns admitted to making and supplying machineguns and to possessing an illegal machinegun with an obliterated serial number. Ms. Goodson’s charges are pending.
Members of the public are reminded that the indictments only contains charges. The defendants are presumed innocent of the charges and it will be the government’s burden to prove the defendants’ guilt beyond a reasonable doubt at trial.
These cases are being investigated by the Federal Bureau of Investigation the Georgia Bureau of Investigation, and the Georgia Department of Corrections Office of Professional Standards.
First Assistant United States Attorney Kurt R. Erskine, Assistant United States Attorneys Brent Alan Gray and John S. Ghose, and Special Assistant United States Attorneys Erin E. Sanders and Trevor Wilmot are prosecuting these cases.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Three Sutter County Residents Sentenced to Prison for Roles in Decades Long Unemployment and Disability Benefits Fraud SchemeRead the Press Release
SACRAMENTO, Calif. — Four residents of Sutter County, California were sentenced to prison today for their roles in a $14 million unemployment and disability benefits fraud scheme based out of Yuba City and Live Oak, California, United States Attorney Benjamin B. Wagner announced.
United States District Judge Morrison C. England Jr. sentenced Mohammad Adnan Khan, 35, of Live Oak, to nine years in prison; Iqila Begum Khan, 32, of Live Oak, to five years in prison; and Mohammad Shahbaz Khan, 50, of Yuba City, to seven years and three months in prison and a $50,000 fine. Each was also ordered to serve a term of three years of supervised release following the service of their prison terms. A hearing will be held November 5, 2015 to determine the amount of restitution owed to the California Employment Development Department. Parole has been abolished in the federal system, and each defendant will be required to serve at least 85 percent of the prison time imposed. A fourth defendant, Mohammad Nawaz Khan, 60, is scheduled to be sentenced on October 1, 2015.
According to court documents, the Khans sold fake paystubs to other people in the community and used the companies they controlled to report false wages for the individuals who purchased those paystubs. At times the Khans instructed the purchasers how to use the fake paystubs to fraudulently claim unemployment and disability benefits. The Khans set up a storefront in Yuba City and sold the fraudulent paystubs on a walk-in basis. Purchasers found out about the opportunity to commit fraud with the Khans in a number of ways. Some purchasers approached the Khans looking for work and were told to commit fraud instead. Others learned of the fraud at public places in the community, like the grocery store.
Over the course of the conspiracy, the defendants reported wages for over 400 separate individuals that resulted in more than 2,000 fraudulent claims for unemployment and disability benefits. The loss in this case is more than $14 million. To date, 28 individuals have been charged and 24 have pleaded guilty to various offenses connected to the scheme.
U.S. Attorney Wagner stated: “The defendants sentenced today committed a massive and brazen fraud that corrupted many members of their community. Collectively, their conduct occurred over the course of decades and involved hundreds of individuals who, but for the defendants’ conspiracy, would likely never have become involved in criminal conduct.”
“The scheme which led to these sentences involved more than bending a rule or exaggerating a claim,” stated Monica Miller, Special Agent in Charge of the Sacramento FBI Field Office. “It was the systematic fabrication of employment histories on a massive scale. I am proud of the work the FBI and our partners on this investigation. By working together, we all put a stop to the scheme which stole money intended for people who earned support from the state in a time of need.”
“This week’s sentencings send a powerful message that combating unemployment insurance fraud remains a high priority for the Office of Inspector General. We will continue to work with our law enforcement partners to safeguard unemployment insurance benefits from illicit enrichment schemes and conspiracies carried out against Department of Labor programs” stated Abel Salinas, Special Agent-in-Charge, U.S. Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations in Los Angeles.
“To defraud vital programs that serve as a lifeline for unemployed and disabled workers is unconscionable,” said EDD Director Patrick W. Henning, Jr. “Today’s sentencing highlights the commitment of EDD investigators, the U.S. Attorney’s Office, and our law enforcement partners to safeguard these programs.”
Of the 28 individuals, charged in this investigation, three remain pending trial. A trial date is set for Mohammad Riaz Khan, Mohammad Shahbaz Khan, and Harjit Johal on November 10, 2015, at 9:00 a.m. before United States District Judge Garland E. Burrell Jr. The charges against those individuals are only allegations; they are presumed innocent until and unless proven guilty beyond a reasonable doubt.
This case is the product of an investigation by the Federal Bureau of Investigation; the U.S. Department of Labor, Office of Inspector General; and the California Employment Development Department, Investigations Division. Assistant United States Attorneys Jared C. Dolan and Sherry D. Haus are prosecuting the case.
Texas Company Sentenced for Mislabeling Mexican Shrimp as Caught in United States WatersRead the Press Release
U.S. Attorney Kenneth A. Polite announced that GARCIA SHRIMP CO., LLC, a Texas Limited Liability Company headquartered in Brownsville, was sentenced today after previously pleading guilty to a one-count Bill of Information for violating the federal Lacey Act.
U.S. District Judge Nannette Jolivette Brown, pursuant to a plea agreement with the Government, sentenced GARCIA SHRIMP to pay a criminal fine of $150,000. GARCIA SHRIMP also sentenced to a three year term of probation with conditions that subject the company to increased labeling, recordkeeping, and auditing requirements. The 35,000 pounds of shrimp previously seized was later sold in a forfeiture auction for $120,800.
According to court documents, in early October 2012, GARCIA SHRIMP purchased 35,000 pounds of Mexican shrimp from Mexican businessmen. The shrimp was packaged in plastic crates typically used by Mexican supermarket wholesalers. After taking receipt of the shrimp, company personnel removed “Product of Mexico” labels from the packages containing the shrimp and attached new tags indicating that the shrimp was caught in U.S. waters. Company personnel also conducted an offloading ruse, whereby the shrimp was trucked down to GARCIA SHRIMP’s dock facility and then re-weighed and wrapped to make it appear as if the shrimp was caught by a local U.S. flagged fishing vessel. Then company personnel created false documents and bills of lading that falsely read, “Product of U.S.A., Wild Caught Gulf Shrimp.” On or about October 12, 2012, GARCIA SHRIMP sold the shrimp to a New Orleans based seafood distributor.
U.S. Attorney Polite praised the work of the U.S Department of Commerce NOAA Office of Law Enforcement, and the Louisiana Department of Wildlife and Fisheries in investigating this matter. The case was prosecuted with the support of the Federal Interagency Seafood Fraud Task Force. Eastern District of Louisiana Assistant U. S. Attorney Spiro G. Latsis and Department of Justice Trial Attorney Christopher L. Hale with the Environmental Crimes Section in Washington D.C. were in charge of the prosecution.
Teamster Sentenced for Stealing Unemployment BenefitsRead the Press Release
BOSTON – A member of the Boston Teamsters Local 82 was sentenced today in U.S. District Court in Boston in connection with stealing unemployment insurance benefits.
Thomas Flaherty, 52, of Braintree, was sentenced by U.S. District Court Judge Denise J. Casper to two years of probation, a fine of $1,000, and restitution of $21,011. In July 2015, Flaherty pleaded guilty to three counts of mail fraud for defrauding the Massachusetts Department of Workforce Development, Division of Unemployment Assistance of unemployment insurance benefits.
From March 2010 to December 2011, while working for Local 82, Flaherty’s gross earnings were $49,890; however, Flaherty made several misrepresentations so that he could collect unemployment insurance benefits. Specifically, Flaherty falsely reported to the Department of Unemployment Insurance that during the same time period he earned only $10,102. Flaherty failed to report his weekly earnings or significantly under-reported his earnings so that it appeared to the Department of Unemployment Insurance that he was eligible to receive full or at least partial unemployment insurance when, in fact, he was employed nearly full time and was not eligible. In total, Flaherty collected $21,093 in unemployment insurance benefits.
United States Attorney Carmen M. Ortiz; Scott S. Dahl, Inspector General of the U.S. Department of Labor, Office of Inspector General; Jonathan Russo, District Director of the U.S. Department of Labor, Office of Labor-Management Standards; Susan A. Hensley, Regional Director of the U.S. Department of Labor, Employee Benefits Security Administration; and Boston Police Commissioner William Evans, made the announcement. The case is being prosecuted by Assistant U.S. Attorneys Laura J. Kaplan of Ortiz’s Organized Crime and Gang Unit and Susan G. Winkler of Ortiz’s Narcotics and Money Laundering Unit.
Swanton woman charged with wire fraudRead the Press Release
A Swanton woman was charged with one count of wire fraud, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio.
Cynthia M. Brinkman, 50, worked at Hank's Plumbing and Heating, Inc.. where she was authorized to write checks from the company's account. Between 2007 and 2015, Brinkman wrote and deposited checks totalling $180,000 to herself on the company's account that were not authorized, according to the information.
If convicted, the defendant’s sentence will be determined by the court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, and the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum. The investigating agency in this case is the Federal Bureau of Investigation. The case is being handled by Assistant U.S. Attorney Tracey Ballard Tangeman.
An information is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Streetsboro man sentenced to nine years in prison for child pornography crimesRead the Press Release
A Streetsboro man was sentenced to nine years in prison for child pornography crimes, law enforcement officials said.
Ronald Flick, 47, was previously found guilty of one count of receiving and distributing visual depictions of minors engaged in sexually explicit conduct and one count of possessing computers, hard drives and compact discs containing child pornography.
The case is being prosecuted by Assistant United States Attorney Michael Sullivan following an investigation by the Federal Bureau of Investigation, the Ohio Bureau of Criminal Investigation and the Streetsboro Police Department.
Spencer Chiropractor to Pay $62,349 to Resolve False Claims Act AllegationsRead the Press Release
Elizabeth Kressin, D.C., from Spencer, Iowa, has agreed to pay $62,349 to resolve allegations she violated the False Claims Act by improperly billing the Medicaid system for medically unnecessary chiropractic procedures and for the treatment of conditions for which payment is not allowed, including bed wetting, colic and ear infections. The government alleged that Kressin caused the submission of the improper claims from January 1, 2008, through June 30, 2015. The claims settled by the agreement are allegations only; there has been no admission or judicial determination of liability.
“The civil False Claims Act was created to serve as a tool for combating fraud, waste and abuse in federally funded programs,” emphasized Kevin W. Techau, United States Attorney for the Northern District of Iowa. Techau noted that this case puts providers on notice, indicating “This recovery sends the message that health care providers must comply with all applicable state and federal regulations when billing the United States Government for services, or they will face consequences.”
The allegations resolved by the settlement arose from an investigation led by the Department of Health and Human Resources and initiated by the State of Iowa’s Medicaid Program Integrity Unit. False Claims Act cases also arise under the qui tam, or whistleblower provision of the Act. Under those provisions, a private party may file suit on behalf of the United States for false claims and share in any recovery.
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Smithfield Woman Sentenced for Embezzling More Than $274,000 from Her EmployerRead the Press Release
PROVIDENCE, R.I. – Christi Romano, aka Christi Machala, 36, of Smithfield, R.I., was sentenced today to four years probation, the first six months to be served in home confinement, for embezzling more than $274,000 from Christa Creations, a toy manufacturer and distributor in Smithfield where she was employed, and for lying to FBI agents during the investigation into the theft, announced United States Attorney Peter F. Neronha and Joseph R. Bonavolonta, Acting Special Agent in Charge of the Boston Field Office of the FBI.
At sentencing, U.S. District Court Judge John J. McConnell, Jr., also ordered Romano to pay restitution in the amount of $274,751.06. Romano pleaded guilty on May 27, 2015, as charged by way of a federal indictment returned in October 2014, to charges of wire fraud and making false statements.
At the time of her guilty plea, Romano admitted to the court that between February 16, 2010, and March 26, 2012, she made 126 unauthorized wire transfers totaling $274,751.06 from a bank account belonging to Christa Creations. Romano admitted to the court that she used the funds to pay her personal credit card debt.
At the time of her guilty plea, Romano also admitted to the court that during the investigation she made false statements to FBI agents when she told the agents that she did not steal or misapply funds belonging to Christa Creations.
The case was prosecuted by Assistant U.S. Attorney Richard W. Rose.
The matter was investigated by the FBI, with the assistance of the Internal Revenue Service Criminal Investigation.
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Contact:
Jim Martin (401) 709-5357
email: [email protected]
on Twitter @USAO_RI
Sentencings for September 14 - September 24, 2015Read the Press Release
Marshall Glenn McGinty, 44, was sentenced by Federal District Court Judge Alan B. Johnson on September 24, 2015, for being a felon in possession of a firearm; carjacking; and using and carrying a firearm during a crime of violence. McGinty was arrested in Casper, Wyoming. He received 204 months imprisonment, to be followed by five years of supervised release, and was ordered to pay a $300.00 special assessment and restitution in the amount of $5,338.87. This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Jason Roger Moore, 36, of Laramie, Wyoming, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on September 22, 2015, for being a felon in possession of a firearm. Moore was arrested in Laramie, Wyoming. He received 36 months imprisonment, to be followed by three years of supervised release, and was ordered to pay a $150.00 fine and a $100.00 special assessment. This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Shelly Lynn McElroy, 46, of Salt Lake City, Utah, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on September 14, 2015, for conspiracy to distribute at least 50 grams of a mixture or substance containing a detectable amount of methamphetamine. McElroy was arrested in Utah. She received 110 months imprisonment, to be followed by four years of supervised release, and was ordered to pay a $500.00 fine and a $100.00 special assessment. This case results from an ongoing Organized Crime Drug Enforcement Task Forces (OCDETF) joint investigation conducted by the Wyoming Division of Criminal Investigation, the U.S. Drug Enforcement Administration and the Internal Revenue Service, Criminal Investigation Office. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
Second Texas Man Pleads Guilty to Federal Hate Crime Against Gay African-American ManRead the Press Release
CORPUS CHRISTI, Texas - A second Texas man has pleaded guilty to hate crime offenses for his role in a Mar. 8, 2012, assault of a gay African-American man in Corpus Christi, announced U.S. Attorney Kenneth Magidson and Principal Deputy Assistant Attorney General Vanita Gupta, head of the Department of Justice’s Civil Rights Division.
Jimmy Garza, 33, pleaded guilty in federal court in Corpus Christi today to one count of conspiracy to commit hate crimes and one count of a hate crime violation based on the victim’s sexual orientation.
During the plea hearing, Garza admitted that he and others conspired to assault a gay African-American man because of his race and sexual orientation. Garza admitted that during the assault, he and his co-conspirators punched and kicked the man, and assaulted him with various weapons, including a frying pan, a mug, a sock filled with batteries, a broom and a belt.
Garza admitted that when the victim began to bleed, the conspirators forced him to remove all of his clothing and clean up the blood throughout the apartment. After the victim was completely naked, Garza held a gun to the victim’s head, while a co-conspirator sodomized the victim with a broom handle. During the assault, Garza poured bleach onto the victim’s face and eyes, and struck him with a handgun. The conspirators also whipped the victim on the back with a belt.
Garza acknowledged that throughout the assault, the conspirators repeatedly called the victim racial and homophobic slurs and made other anti-black and anti-gay statements.
Garza will be sentenced on Dec. 9, 2015, and faces a maximum sentence of 15 years in prison. He will remain in custody pending that hearing. Co-defendant Ramiro Serrata Jr. pleaded guilty to the same hate crime charges in connection with this offense on Sept.15, 2015. He is also set for sentencing on Dec. 9, 2015.
“The gruesome evidence heard in today's plea of guilty underscores the importance of prosecuting hate crimes under our authority to protect the civil rights of all our citizens,” said Magidson. “These cases will continue to be a high priority of our office.”
“The federal hate crime to which Jimmy Garza Jr. and Ramiro Serrata Jr. pleaded guilty to was as shocking as it was reprehensible,” said Gupta. “The Department of Justice will continue to use every tool at its disposal to vindicate the rights of victims of violent crime.”
This case was investigated by the FBI’s Corpus Christi Resident Agency with assistance from the Corpus Christi Police Department. It is being prosecuted by Assistant U.S. Attorney Ruben Perez and Trial Attorneys Jared Fishman and Nicholas Durham of the Civil Rights Division.
Second Texas Man Pleads Guilty to Federal Hate Crime Against Gay African-American ManRead the Press Release
A second Texas man has pleaded guilty to hate crime offenses for his role in a Mar. 8, 2012, assault of a gay African American man in Corpus Christi, Texas, announced Principal Deputy Assistant Attorney General Vanita Gupta, head of the Department of Civil Rights Division, and U.S. Attorney Kenneth Magidson of the Southern District of Texas.
Jimmy Garza, 33, pleaded guilty in federal court in Corpus Christi to one count of conspiracy to commit hate crimes and one count of a hate crime violation based on the victim’s sexual orientation.
During the plea hearing, Garza admitted that he and others conspired to assault a gay African-American man because of his race and sexual orientation. Garza admitted that during the assault, he and his co-conspirators punched and kicked the man, and assaulted him with various weapons, including a frying pan, a mug, a sock filled with batteries, a broom and a belt.
Garza admitted that when the victim began to bleed, the conspirators forced him to remove all of his clothing and clean up the blood throughout the apartment. After the victim was completely naked, Garza held a gun to the victim’s head, while a co-conspirator sodomized the victim with a broom handle. During the assault, Garza poured bleach onto the victim’s face and eyes, and struck him with a handgun. The conspirators also whipped the victim on the back with a belt.
Garza acknowledged that throughout the assault, the conspirators repeatedly called the victim racial and homophobic slurs, and made other anti-black and anti-gay statements.
Garza will be sentenced on Dec. 9, 2015, and faces a maximum sentence of fifteen years in prison. Garza is incarcerated pending sentencing.
On Sept.15, 2015, Ramiro Serrata Jr. pleaded guilty to the same hate crime charges in connection with this offense. Serrata is scheduled for sentencing on Dec. 9, 2015. Serrata also faces a maximum sentence of fifteen years in prison.
“The federal hate crime to which Jimmy Garza Jr. and Ramiro Serrata Jr. pleaded guilty to was as shocking as it was reprehensible,” said Principal Deputy Assistant Attorney General Gupta. “The Department of Justice will continue to use every tool at its disposal to vindicate the rights of victims of violent crime.”
“The gruesome evidence heard in today's plea of guilty underscores the importance of prosecuting hate crimes under our authority to protect the civil rights of all our citizens,” said U.S. Attorney Kenneth Magidson of the Southern District of Texas. "These cases will continue to be a high priority of our office."
This case was investigated by the FBI’s Corpus Christi Resident Agency with assistance from the Corpus Christi Police Department. It is being prosecuted by Trial Attorneys Jared Fishman and Nicholas Durham of the Civil Rights Division and Assistant U.S. Attorney Ruben Perez of the Southern District of Texas.
Romanian Native in Large-Scale Atm Skimming Scheme Extradited to the United States to Face ChargesRead the Press Release
NEWARK, N.J. – A native of Romania who was arrested in Spain will make his initial court appearance and be arraigned tomorrow following his extradition to face charges that he participated in a large-scale lucrative ATM skimming scheme targeting New Jersey bank customers, U.S. Attorney Paul J. Fishman announced.
Alin Dumitru Carabus, 41, will appear tomorrow afternoon before U.S. Magistrate Judge Leda D. Wettre in Newark federal court. He is charged by indictment with conspiracy to commit bank fraud, aggravated identity theft, conspiracy to possess 15 or more counterfeit access devices, and possession of 15 or more counterfeit access devices. One of the other individuals charged in the indictment, Robert Mate, was previously apprehended in Spain and extradited to the United States. The third individual charged in the indictment, Ionut Vasile Ciurba-Stana, has been apprehended in Spain, and a request for extradition is pending.
According to documents filed in this and other cases and statements made in court:
Carabus participated in an extensive scheme to steal bank customer account information, commonly referred to as “ATM skimming,” by installing secret card-reading devices on ATMs throughout New Jersey, New York, Connecticut, Florida, and elsewhere. The scheme was organized by Marius Vintila, 33, who previously pleaded guilty to bank fraud conspiracy and aggravated identity theft charges. The scheme defrauded Citibank, TD Bank, Wells Fargo, and multiple other financial institutions out of at least $5 million and affected thousands of bank customers.
Vintila and Bogdan Radu designed and constructed sophisticated card-reader devices and pinhole camera panels capable of reading and storing customers’ bank account information and personal identification numbers. Carabus and others then secretly installed the card-reader devices and the pinhole cameras panels onto bank ATMs, and removed them a few days later after they had recorded customer bank account information as customers performed routine bank transactions at ATMs. After the account information was stolen, the stolen data was used to create thousands of false and fraudulent ATM cards, which Carabus and others used to withdraw millions of dollars from customers’ bank accounts.
The ATM skimming operation in which Carabus participated is one of the largest ever uncovered by law enforcement. To date, 16 individuals have been charged in connection with this scheme. Twelve have pleaded guilty, and one individual, Dinu Horvat, was convicted after a week-long trial.
Carabus is charged with four counts, as described below, which carry the following maximum penalties and fines:
Count
Offense
Maximum Penalty
Maximum Fine
1
Conspiracy to commit bank fraud
Thirty years in prison
$1 million
2
Aggravated identity theft
Mandatory, consecutive penalty of two years in prison
$250,000, or twice the gross pecuniary gain or loss from the offense
5
Conspiracy to possess 15 or more counterfeit access devices
Five years in prison
$250,000, or twice the gross pecuniary gain or loss from the offense
6
Possession of 15 or more counterfeit access devices
Ten years in prison
$250,000, or twice the gross pecuniary gain or loss from the offense
U.S. Attorney Fishman credited special agents of the U.S. Secret Service, Newark Field Office, under the direction of Special Agent in Charge Carl Agnelli, along with special agents of U.S. Immigration and Customs Enforcement’s (ICE), Homeland Security Investigations (HSI) in Newark, under the direction of Acting Special Agent in Charge Kevin Kelly, with the investigation leading to the charges.The government is represented by Assistant U.S. Attorneys Rahul Agarwal and David M. Eskew of the Criminal Division in Newark.
Defense counsel: Christopher Patella Esq., Bayonne, New Jersey
Rochester Men Charged with Sex Trafficking MinorsRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051ROCHESTER, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that Andre L. Barnes, 39, and Christopher N. Johnson, Jr., 29, both of Rochester, NY, were arrested charged by a criminal complaint with conspiracy to sex traffic minors and sex trafficking of minors. The charges carry a mandatory minimum sentence of 10 years in prison, a maximum of life, and a $1,000,000 fine.
Assistant U.S. Attorney Melissa Marangola, who is handling the case the case, stated that the according the complaint, Barnes and Johnson began working together in 2010 to sex traffic minors. Their conspiracy continued until July 2013 at which time Barnes went to prison for assaulting one of the prostitutes that he is charged with trafficking in this case. The complaint alleges that Johnson has continued to sex traffic minors and adults by posting advertisements on Backpage.com.
The defendants made an initial appearance this afternoon before U.S. Magistrate Judge Jonathan W. Feldman. Barnes, who is currently serving a prison term on a state conviction, is due in court on September 25, 2015 at 3:00 p.m. to determine where he will be detained while the charges are pending. Johnson was detained and will return to court on September 29, 2015 at 4:30 p.m. for a detention hearing.
The arrest was the culmination of an investigation on the part of the Federal Bureau of Investigation Child Exploitation Task Force which includes the Monroe County Sheriff’s Office, the Rochester Police Department, and U.S. Immigration and Customs Enforcement-Homeland Security Investigations.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
Prison Terms Don’t Change for Former Haysville Doctor and WifeRead the Press Release
WICHITA, KAN. - A federal judge Thursday resentenced a former Haysville physician and his wife without changing the amount of time they must spend in prison for illegally distributing prescription pain killers to patients who overdosed on them, U.S. Attorney Barry Grissom said.
Stephen J. Schneider, 62, currently in federal custody, was sentenced Thursday to 30 years in federal prison. His wife, Linda K. Schneider, 57, also in federal custody, was sentenced Thursday to 33 years in federal prison.
U.S. District Judge Monti Belot originally sentenced the Schneiders in October 2010 after they were convicted in an eight-week jury trial on charges including conspiracy, unlawful distribution of controlled substances, health care fraud and money laundering. Belot set the case for resentencing after a Supreme Court ruling last year that a victim’s drug use must be the actual cause of death – not just a contributing factor – to impose the harshest penalties under the federal Controlled Substances Act. The judge threw out some of the original sentences.
During trial, the government=s case centered on the years from 2002 to 2008, when Stephen Schneider saw patients and Linda Schneider, a licensed practical nurse, managed the business of Schneider Medical Clinic at 7030 S. Broadway in Haysville. Prosecutors presented evidence that the Schneiders billed more than $4 million to Medicaid and other health insurance providers while they operated the clinic unlawfully, distributing controlled substances without a legitimate medical purpose, falsifying insurance claims, and engaging in unlawful financial transactions with the proceeds of the crimes.
Grissom commended the following agencies and individuals who worked on the case: The Department of Health and Human Services, the Drug Enforcement Administration, the Kansas Attorney General=s Medicaid Fraud and Abuse Division, the Federal Bureau of Investigation, U.S. Postal Inspection Service, the Kansas Bureau of Investigation, and Assistant U.S. Attorneys Tanya Treadway, Jon Fleenor, and Jabari Wamble, who prosecuted the case.
Plymouth Resident Pleads Guilty to Mail Fraud and Aggravated Identity TheftRead the Press Release
A Plymouth man who impersonated a West Point graduate pleaded guilty today to mail fraud and aggravated identity theft, U.S. Attorney Barbara L. McQuade announced today. McQuade was joined in the announcement by Acting Special Agent in Charge John Shoup, Federal Bureau of Investigation, Detroit Division. William Douglas Street, 64, pleaded guilty before U.S. District Judge Gershwin Drain. Street pleaded guilty to devising and executing a scheme to impersonate a United States Military Academy and Duke University graduate. Street requested transcripts and diplomas in the victim’s name from both institutions using the United States mail. In order to complete these requests, he used identifying information, including the victim’s social security number, date of birth and place of birth. He signed the victim’s name to the request forms. As a result of Street’s actions, the United States Military Academy and Duke University sent the defendant the victim’s transcripts and diplomas. Street created an email account using the victim’s name. He also set up a profile on Career Builder and applied for jobs using a resume he created in the victim’s name. In February 2015, law enforcement officers recovered transcripts, diplomas and various other items in the victim’s name at Street’s residence in Plymouth, Michigan. Street entered into a plea agreement that calls for a sentence of 28-34 months in prison. A sentencing hearing was set for January 28, 2015 at 2:00 pm. This case was investigated by special agents of the Federal Bureau of Investigation and the Plymouth Township Police Department and prosecuted by Assistant U.S. Attorney April Russo.Pennsylvania sex offender sentenced for failure to update registrationRead the Press Release
WHEELING, WEST VIRGINIA – Weirton, West Virginia resident Henry Lee Cutler, 24, originally of Clearfield, Pennsylvania, was sentenced today to 27 months in prison for failing to update his sex offender registration, United States Attorney William J. Ihlenfeld, II, announced.
In 2010, Cutler was convicted of “Indecent Assault” in Clearfield County, Pennsylvania. As a result of that conviction, he is required to register as a sex offender. In late 2014 or early 2015, Cutler relocated across state lines from Pennsylvania to the Weirton, West Virginia area. He failed to update his sex offender registration to reflect his new residence in West Virginia. He pled guilty in June 2015 to one count of “Failure to Register as a Sex Offender.”
Assistant U.S. Attorney Jarod Douglas prosecuted the case on behalf of the government. The United States Marshals Service investigated.
U.S. District Judge John Preston Bailey presided.
Page County, Iowa, Resident Sentenced for Conspiracy to Distribute MethamphetamineRead the Press Release
Council Bluffs, IA- On September 23, 2015, James Jayson Davis, 41, of Shenandoah, Iowa, was sentenced by Senior United States District Court Judge James E. Gritzner to 183 months in prison for conspiracy to distribute methamphetamine, announced United States Attorney Nicholas Klinefeldt. Davis’ term of imprisonment is to be followed by five years of supervised release.
Davis entered a guilty plea on February 5, 2015, to conspiracy to distribute methamphetamine from September 2013 up to July of 2014. The plea of guilty resulted from a year-long investigation into drug trafficking in Southwestern Iowa by a group that included Davis and his cousin, James Paul Davis. James Paul Davis was sentenced to 192 months in prison on July 27, 2015, by Judge Gritzner. The investigation showed that methamphetamine was being transported to Southwestern Iowa from the border region in Texas in pound quantities for distribution from Page County, across Southwestern Iowa and into Eastern Nebraska.
The investigation was conducted by the Iowa Division of Narcotics Enforcement, Page County Sheriff’s Office, Shenandoah, Iowa Police Department, Mills County Sheriff’s Office, Southwest Iowa Narcotics Task Force, Omaha, Nebraska Police Department, Metro Area Fugitive Task Force, and the United States Marshal’s Service for the Southern District of Iowa.
The case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
Owner of Reisterstown Auto Detailing Service Indicted for Submitting False Invoices Overbilling a Customer More Than $515,000Read the Press Release
Baltimore, Maryland – A federal grand jury today indicted Lawrence Coleman, age 46, of Reisterstown, Maryland, on charges arising from a scheme to defraud a customer by submitting false invoices, overbilling more than $515,000.
The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation.
According to the indictment, Coleman owned and operated Perfection Plus Auto Detailing, located in Reisterstown, Maryland. Prior to starting his business, Coleman was an employee of Avis, a rental car company. Beginning in 2007, Perfection Plus contracted with Avis to provide vehicle prepping services at Baltimore/Washington Thurgood Marshall Airport (“BWI”) in Hanover, Maryland. These services were performed on new vehicles prior to being offered for rent (infleeting), as well as for vehicles that were being removed from service (defleeting). According to the indictment, after a rental vehicle underwent Perfection Plus’ infleeting or defleeting service at the BWI site, the service manager for Perfection Plus sent Coleman a vehicle worksheet that included a checklist of the work that was performed on each car. Based upon the submitted worksheets, Coleman prepared invoices listing the identification numbers of the cars serviced, and then sent those invoices to Avis, billing Avis approximately $14.75 per vehicle for the prep service.
The indictment alleges that from August 2007 through November 2010, Coleman submitted false invoices to Avis for prepping services that were not performed on thousands of rental vehicles purportedly serviced by Perfection Plus, sometimes submitting more than twenty invoices for the same vehicle. To conceal the scheme, Coleman submitted new invoices that contained both the identification numbers of rental vehicles for which payment was legitimately due and those for which payment had already been made. Coleman allegedly used his knowledge as a former Avis employee to avoid closer scrutiny of his billing practices by submitting individual invoices that were less than $1,000, a threshold amount not requiring a second level of approval under Avis’ internal accounting procedures.
The indictment alleges that Coleman overbilled Avis approximately $515,149, and the indictment seeks forfeiture in that amount.
Coleman faces a sentence of 20 years in prison for wire fraud. Coleman’s initial appearance has not been scheduled.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
United States Attorney Rod J. Rosenstein commended the FBI for its work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Martin J. Clarke, who is prosecuting the case.
Owner of Florida Mortgage Company Sentenced to over 11 Years in Prison for Orchestrating $64 Million Fraud SchemeRead the Press Release
Two Associates Also Sentenced for their Roles in the Conspiracy
The owner of a Florida mortgage company was sentenced today to serve 135 months in prison for orchestrating a $64 million mortgage fraud scheme.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida and Special Agent in Charge Nadine Gurley of the U.S. Department of Housing and Urban Development Office of Inspector General (HUD-OIG) Atlanta Region made the announcement.
Hector Hernandez, 57, of Miami, Florida, the owner and operator of Great Country Mortgage Bankers (Great Country), a mortgage lender in Miami, was sentenced for conspiracy to commit wire fraud affecting a financial institution. He was also ordered to pay $64,508,141 in restitution and to forfeit $8,000,000 in illicit profits.
In the same case, a real estate developer for Great Country, Aleida Fontao, 62, of Miami, was sentenced today to serve 41 months in prison, and ordered to pay $7,131,952 in restitution and $400,000 in forfeiture. An underwriter for Great Country, Olga Hernandez, 59, of Lake Mary, Florida, was sentenced yesterday to serve 51 months in prison and ordered to pay $24,512,755 in restitution. Hector and Olga Hernandez both pleaded guilty on July 13, 2015, while Fontao pleaded guilty on July 7, 2015. Hector Hernandez was the last defendant to be sentenced in the case. All 24 defendants charged in this case, which included loan officers, loan processors and underwriters, were convicted of participating in the scheme.
According to admissions made in connection with the guilty pleas, from at least 2006 and continuing through at least September 2008, Hector Hernandez was the owner and operator of Great Country which specialized in approving Federal Housing Administration (FHA) loans. The loans were primarily for buyers of condominiums at complexes where Hector Hernandez was a part owner – however, the buyers were unqualified borrowers, due to insufficient income, high levels of debts, and outstanding collections. Hector Hernandez admitted that his company employed loan officers, loan processors and underwriters, including Olga Hernandez and Fontao, whom he knew approved and submitted false and fraudulent FHA mortgage loan applications and accompanying documents to HUD on behalf of the unqualified borrowers. These documents included false pay stubs, false verification of employment forms, and fictitious letters from the borrowers.
According to admissions made in connection with the guilty pleas, closing costs were paid on behalf of the unqualified borrowers through an interstate wire transfer of funds. The borrowers were also paid to purchase the condominium units as an unreported inducement to purchase. After the loans closed, the loans were sold to financial institutions. When the unqualified borrowers failed to meet their monthly mortgage obligations, they defaulted on the loans causing losses both to the financial institutions and to HUD which insured the loans. Hector Hernandez admitted that the loss from the fraudulent conduct was at least $64 million.
This case was investigated by HUD-OIG as participants in the Miami Mortgage Fraud Strike Force. The case was prosecuted by Senior Litigation Counsel David A. Bybee and Trial Attorneys Mike O’Neill and William Johnston of the Criminal Division’s Fraud Section.
Owings Mills Man Admits to Jewelry Store Heist that Included a Home Invasion Robbery, Carjacking and KidnappingRead the Press Release
Baltimore, Maryland – Grigoriy (Greg) Zilberman, age 24, of Owings Mills, pleaded guilty today to a robbery conspiracy in connection with the robbery of a jewelry store, including a home invasion robbery, and a carjacking and kidnapping.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation; Chief James W. Johnson of the Baltimore County Police Department; and Baltimore County State’s Attorney Scott Shellenberger.
According to his plea agreement, Zilberman was part of a conspiracy to rob a Pikesville jewelry store. In the course of the conspiracy, Zilberman admitted that he also participated in a home invasion robbery in order to obtain firearms, which were subsequently used in the jewelry store robbery.
Specifically, on July 22, 2012, Zilberman and other conspirators robbed a home in Reisterstown, Maryland. Zilberman was familiar with the layout of the home, having been there as a guest on a number of occasions. Zilberman knew that the residents of the home owned firearms and he had handled and fired some of the weapons. After conducting surveillance of the home for several days prior to the robbery, at 2:30 a.m. on July 22, 2012, Zilberman and his co-conspirators traveled to the home in Reisterstown. Dressed all in black and wearing ski masks and latex gloves, Zilberman and his co-conspirators entered the home through the unlocked garage door. One of the conspirators was armed with a handgun when they entered the residence. Zilberman and two other conspirators grabbed long guns and carried them throughout the home. A resident of the home was asleep when the four robbers entered his bedroom and woke him up, pointing guns at him and shining flashlights in his eyes. One of the robbers beat the resident when he tried to resist and the resident was bound with a belt and a cord. For approximately one hour the robbers ransacked the home looking for firearms and other valuables. After the robbers left, the resident was able to free himself and call police. The resident was taken to the hospital for treatment of his injuries. Among the items stolen from the house were 10 long guns (rifles and shotguns), a crossbow, a laptop computer and jewelry. Numerous electronic devices including computers and televisions were destroyed during the robbery. The value of the items stolen was approximately $10,000.
According to the plea agreement, in the fall of 2012, a co-conspirator devised a plan to commit an armed robbery of a jewelry store, known to be owned and operated by members of the Russian community of Northwest Baltimore. The co-conspirator recruited Zilberman and others to participate in the robbery. Prior to the robbery, the conspirators gathered intelligence, including conducting surveillance and attaching a GPS device to the car of an employee of the jewelry store in order to learn the employee’s travel routine and habits. Zilberman also exploited his friendship with the employee to obtain information about the operation of the jewelry store and the habits of the employee.
According to his plea agreement, on January 15, Zilberman enticed the employee to visit his home, aware that after the employee left Zilberman’s home, the co-conspirators planned to abduct him at gunpoint to obtain keys and other information from him in order to rob the jewelry store. Early in the morning on January 16, 2013, as the employee was driving from Zilberman’s home, four co-conspirators used a law enforcement-type light bar and a loudspeaker to impersonate a police officer and pull over the employee. Brandishing firearms, the co-conspirators removed the employee from his car, bound and blindfolded the employee, put him into the trunk of his own car, and drove him to a predetermined location. According to the plea agreement, once at the location, Zilberman’s co-conspirators continued to brandish firearms and threatened to kill the employee’s family if he did not comply with their demands or if he reported the incident to police. The employee complied and at approximately 3:52 a.m., two co-conspirators drove the employee’s vehicle from the remote location to the jewelry store, while other co-conspirators stayed with the employee. Additional co-conspirators were stationed near the jewelry store to act as “look-outs.” The two co-conspirators entered the jewelry store and stole jewelry, stones, and watches, valued at about $500,000.
On the evening of January 16, 2013, the employee returned to Zilberman’s home and told him of his abduction and the robbery, including the fact that he and his family were threatened if he reported the incident to the police.
On January 18, 2013, one of the conspirators sold a portion of the stolen jewelry for approximately $29,000 to an FBI informant. On January 19, 2013, the conspirator traveled to Brooklyn, New York to sell some of the jewelry and stones taken during the robbery, receiving over $100,000. On January 21, 2013, the conspirator returned to Maryland and divided the cash proceeds among the members of the conspiracy and others. Zilberman received $5,000 cash for his role in the crimes.
Zilberman faces a maximum sentence of 20 years in prison for the robbery conspiracy. U.S. District Judge J. Frederick Motz has scheduled sentencing for December 18, 2015.
United States Attorney Rod J. Rosenstein praised the FBI, Baltimore County Police Department, and Baltimore County State’s Attorney’s Office for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorney Paul E. Budlow and Aaron S. J. Zelinsky, who are prosecuting the case.
Norwalk Man Admits Running Ponzi SchemeRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that JAMES E. NEILSEN, 55, of Norwalk, waived his right to indictment and pleaded guilty today in Hartford federal court to one count of wire fraud stemming from his operation of a Ponzi scheme that defrauded investors of more than $1.6 million.
According to court documents and statement made in court, NEILSEN was a certified public accountant until he became inactive in approximately 2012. Since at least 2006, NEILSEN solicited and received more than $1 million dollars from numerous individuals to invest with Ulysses Partners, LLC, an entity in which NEILSEN was a partner and chief financial officer, or Neilsen Financial Services, an entity that NEILSEN owned and controlled. NEILSEN promised investors a guaranteed rate of return of 9 to 10.5 percent on their investment. NEILSEN told investors that Ulysses Partners or Neilsen Financial Services would invest their money in businesses or business ventures. Instead, NEILSEN used much of that money to pay back earlier victim investors and to make various personal expenditures.
As part of the scheme, NEILSEN submitted fabricated account statements to his victims, and also sent lulling emails to multiple victims.
Through this scheme, NEILSEN defrauded victim investors of $1,663,641.83. NEILSEN’s victims include his accounting clients, clients of his tax preparation business, friends and members of his family, including his 93-year-old great aunt. His victims also include minor children beneficiaries of a trust established after their father’s untimely death and whose trust monies NEILSEN had authorized access to.
NEILSEN was arrested on June 18, 2015, and is released on a $250,000 bond. He is scheduled to be sentenced by U.S. District Judge Robert N. Chatigny on December 22, 2015, at which time he faces a maximum term of imprisonment of 20 years. He also has agreed to pay restitution in the amount of $6,273,841.95, which includes additional monies owed to investors.
This matter is being investigated by the Federal Bureau of Investigation, the Greenwich Police Department and the Connecticut Department of Banking. The case is being prosecuted by Assistant U.S. Attorney David T. Huang.
Northern West Virginia law enforcement, pharmacies to participate in national drug take-back dayRead the Press Release
WHEELING, WEST VIRGINIA – Law enforcement and community leaders from across the Northern District of West Virginia will participate in the Drug Enforcement Administration’s National Prescription Drug Take-Back event scheduled for Saturday, September 26 2015, United States Attorney William J. Ihlenfeld, II, announced.
From 10:00AM until 2:00PM local time, law enforcement agencies, pharmacies, and community organizations across the country will establish and staff a variety of locations where local residents can return unwanted, unneeded, or expired prescription drugs for safe disposal.
“West Virginia has the third highest number of narcotic painkiller prescriptions per person in the nation,” noted U.S. Attorney Ihlenfeld. “These medications are easily diverted and can be extremely dangerous when not used as directed by a medical professional. The national prescription take-back event is an important step to ensure that unused medications are disposed of properly.”
Between 2010 and 2014, the Drug Enforcement Administration sponsored nine national prescription drug take-back events and collected 4,823,251 pounds, or 2,411 tons, of prescription medications.
Individuals interested in finding local participating locations or obtaining additional information regarding the Drug Enforcement Administration’s Prescription Drug Take-Back initiative are encouraged to visit www.dea.gov, call 1-800-882-9539, or contact your local law enforcement agency.
Nine people indicted for marijuana distribution and money laundering conspiracyRead the Press Release
Nine people were charged in a superseding indictment for their roles in a conspiracy to ship marijuana from California to Ohio, then launder the drug proceeds and send the money back to California, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio.
Indicted are: James Sorgi, 33, of McKinleyville, Calif.; Robert Serina, 35, of Cleveland; Stuart Pflaum, 34, of Hudson; Craig Kavak, 26, of Parma; Allyson Love, 27, of McKinleyville, Calif.; Dino Silvestri, 32, of Parma; Dustin Allred, 34, of Parma; Madelaine Davidson, 21, of McKinleyville, Calif., and Daniel Linton, 27, of McKinleyville, Calif.
Sorgi operated a drug trafficking organization that shipped marijuana from California to Cleveland. He grew the marijuana in California and also obtained marijuana from other growers. Sorgi then worked with Serina and Pflaum to direct others to receive multi-pound shipments of marijuana in Ohio and sell it there, according to the indictment.
Sorgi, working with Serina, Pflaum and others, then directed people to collect the drug proceeds and make cash deposits into various bank accounts. Sorgi, through Pflaum and Serina, then directed people to convert the cash into money orders and send the money to California, according to the indictment.
This took place between June 2013 and Februay 2015, according to the indictment.
Prosecutors are seeking to forfeit at least $86,000 from the organization.
“The laundering of illegal drug profits is as important and essential to drug traffickers as the very distribution of their illegal drugs,” said Kathy A. Enstrom, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office. “Without these ill-gotten gains, the traffickers could not finance their organizations. IRS Criminal Investigation is committed with taking the profit away from the drug traffickers and ensuring the major players of these operations are held accountable.”
This case is being prosecuted by Assistant U.S. Attorneys Michelle Baeppler and Margaret Sweeney following an investigation by the Northern Ohio Law Enforcement Task Force. The NOLETF is a task force comprised of investigators from the Federal Bureau of Investigation, Cleveland Division of Police, Cuyahoga Metropolitan Housing Authority, Drug Enforcement Administration, Internal Revenue Service, Cuyahoga County Sheriff’s Office, Ohio Bureau of Criminal Investigation and the police departments of Cleveland Heights, Euclid, Lakewood, the Regional Transit Authority, Westlake and Shaker Heights. The NOLETF is also one of the initial Ohio High Intensity Drug Trafficking Area initiatives, which supports and helps coordinate numerous Ohio drug task forces in their efforts to eliminate or reduce drug trafficking in Ohio.
If convicted, the defendants’ sentences 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.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
New Orleans Woman Charged with Violating the Federal Controlled Substances ActRead the Press Release
U.S. Attorney Kenneth A. Polite announced that VIRGINIA BROWN, age 22, of New Orleans, was charged today in a one-count Bill of Information with violating the Federal Controlled Substances Act.
According to the Bill of Information, on or about August 10, 2015, BROWN distributed a quantity of heroin. The Government is seeking to forfeit any proceeds from BROWN’s drug dealing.
If convicted, BROWN faces a term of imprisonment of up to twenty years, a fine of up to $1,000,000, and at least three years of supervised release following any term of imprisonment.
U. S. Attorney Polite reiterated that the Bill of Information is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
U.S. Attorney Polite praised the work of the Drug Enforcement Administration and the New Orleans Police Department in investigating this matter. Assistant United States Attorney David Haller is in charge of the prosecution.
Nassau County Nurse Pleads Guilty to Receiving Child Pornography over the InternetRead the Press Release
Jacksonville, Florida – United States Attorney A. Lee Bentley, III announces today that Ronald Eugene Mabrey, Jr. (34, Callahan) has pleaded guilty to receiving child pornography over the Internet. He faces a mandatory minimum penalty of 5 years, up to 20 years, in federal prison. A sentencing hearing has not yet been set. Mabrey has been in custody since his arrest.
According to court documents, on July 28, 2015, FBI agents and other law enforcement officers executed a federal search warrant at Mabrey’s residence. During an interview, Mabrey admitted that he had searched for, downloaded, and viewed “all types” of child pornography, and he stated that his addiction to child pornography had started about four years ago. A subsequent forensic examination of Mabrey’s laptop and a thumb drive revealed more than 190 videos and at least 4,000 images depicting child pornography.
This case was investigated by the Federal Bureau of Investigation, the Nassau County Sheriff’s Office, the Florida Department of Law Enforcement, and the Jacksonville Sheriff’s Office. It is being prosecuted by Assistant United States Attorney D. Rodney Brown.
This is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
NY Woman Federally Indicted for Credit Card Fraud in Central Pennsylvania StoresRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced that a New York state woman was indicted late yesterday by a federal grand jury in Harrisburg for allegedly using fraudulently obtained credit cards in June 2014 to make thousands of dollars of purchases from stores in Cumberland County and Luzerne County.
According to United States Attorney Peter Smith, Zeni Ortiz-Reyes, age 31, of Middletown, New York was charged in an indictment with making purchases with an unauthorized access device card. Ortiz-Reyes allegedly made purchases at the Best Buy store and in Mechanicsburg and at a Lowes store in West Hazelton in June 2014. Ortiz-Reyes purchased gift cards and merchandise using credit cards she applied for in someone else’s name without that person’s knowledge or permission. The gift cards and merchandise amount to approximately $18,000.
The investigation was conducted by the United States Secret Service, the Hampden Township and Silver Spring Township Police Departments, and the security personnel for the retail stores. The case has been assigned to Assistant U.S. Attorney William A. Behe.
Indictments are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law for each count is 15 years of imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Muskogee Man Pleads Guilty to Possession of Material Involving Sexual Exploitation of MinorsRead the Press Release
MUSKOGEE, OKLAHOMA - The United States Attorney’s Office for the Eastern District of Oklahoma, announced that PAUL BENJAMIN STONE, age 34, of Muskogee, Oklahoma, pled guilty to POSSESSION OF CERTAIN MATERIAL INVOLVING THE SEXUAL EXPLOITATION OF MINORS, in violation of Title 18, United States Code, Sections 2252(a)(4)(B) and 2252(b)(2), punishable by up to 10 years imprisonment, up to a $250,000.00 fine or both.
The Indictment alleged that between on or about August 1, 2013, and on or about April 16, 2014, in the Eastern District of Oklahoma, the defendant, PAUL BENJAMIN STONE, did knowingly possess and attempt to possess matters which contained visual depictions and the production of said visual depictions involved the use of minors engaging in sexually explicit conduct and had been transported in interstate commerce by computer.
The charges arose from an investigation by the Federal Bureau of Investigation.
The Honorable Kimberly E. West, Magistrate Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, accepted the guilty plea and ordered the completion of a presentence report. Sentencing will be scheduled following its completion.
Assistant United States Attorney Edward Snow represented the United States.
Mount Carmel Woman Charged with Health Care FraudRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced that a Mount Carmel woman was indicted yesterday by a grand jury in Harrisburg on charges related to health care fraud.
According to United States Attorney Peter Smith, Joan Cicchiello, age 64, of Mount Carmel, Northumberland County, Pennsylvania, the owner and operator of Twilight Beginnings, a psychiatric and counseling practice, was charged with one count of health care fraud and 14 counts of making false written statements and writings to obtain Medicare payments.
According to the indictment, between May 2010 and the present, Cicchiello’s business contracted with skilled nursing facilities in Adams, Dauphin, York, Franklin, Schuylkill, Lancaster and Northumberland Counties to provide mental health services to residents.
The indictment alleges that Cicchiello, a certified registered nurse practitioner, employed at least four individuals who did not meet Medicare licensing requirements for the provision of mental health services. Services were allegedly provided by the individuals but false claims for payment were submitted to Medicare indicating that Cicchiello had provided the services and were paid on that basis.
Cicchiello fraudulently obtained on-line certification in pastoral counseling for workers, falsely stated on applications for renewal of her license that she had never been convicted of any felony and misdemeanor offenses, and submitted false claims to Medicare stating she had provided medical or counseling services on dates when she was on vacation or actually traveling outside the United States.
The indictment also contains an allegation by the government seeking forfeiture of property derived from the offenses.
The case was investigated by the Department of Health and Human Services Office of Inspector General and the Federal Bureau of Investigation. Assistant U.S. Attorney Christy H. Fawcett is the assigned prosecutor.
An indictment is only an allegation. The person charged in the indictment is presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum sentence for the offense of health care fraud is 20 years’ imprisonment, three years’ supervised release, and a $250,000 fine. Each count of making false writings and statements in connection with a health care matter carries a maximum term of imprisonment of five years in prison, a $250,000 fine, and a three-year term of supervised release. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Monitor Finds Seattle Police in Initial Compliance with Requirements Relating to Reporting, Investigating and Analyzing Uses of ForceRead the Press Release
WASHINGTON – The Department of Justice announced today that formal assessments of Seattle Police Department (SPD) reforms relating to documenting, investigating and analyzing uses of force by officers have found SPD to be in initial compliance with specific provisions of the court-ordered agreement with the Department of Justice. Federal monitor Merrick Bobb filed the first four of 15 systemic assessments with the U.S. District Court and concluded that, in three of the four areas reviewed thus far—out of 15 total assessments—SPD is in initial compliance with specific requirements of the consent decree.
This first round of assessments, following the July 2012 consent decree and overseen by an independent and jointly selected monitor, analyzed how effectively SPD is tracking uses of force by officers at all levels of reportable force. Specifically, the monitoring team and the Department of Justice and its policing experts, reviewed use of force reports and investigations from incidents occurring from July 1, 2014, through Dec. 31, 2014, to conduct four separate assessments relating to:
- Reporting of low-level uses of force (Type I reporting);
- Reporting of intermediate and high-level uses of force (Type II and III reporting);
- Chain of command investigations for Type I and II incidents; and
- Force Investigation Team (FIT) investigations for Type III incidents.
Of the first four assessments, the monitor and Department of Justice found that SPD is in initial compliance with Type I reporting, Type II and III reporting and FIT investigations for Type III uses of force.
“I commend Seattle’s leaders for their commitment to enhancing law enforcement through transparency and accountability,” said Attorney General Loretta E. Lynch. “Today’s assessments show that real progress is possible when we engage with one another, when we summon our goodwill and good faith, and when we work collaboratively as partners with a mutual and shared interest in ensuring the safety and security of the communities we call home. I look forward to seeing even more progress in the days and months ahead.”
“The Seattle Police Department has made tremendous strides in implementing reforms, and we congratulate them on this progress,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division. “This achievement is possible because of the collaborative work of the many stakeholders in this process. Although work remains, these assessments show the change that is possible, here and across the country.”
“I commend the Seattle Police Department for this important first step towards full consent decree compliance,” said U.S. Attorney Annette L. Hayes of the Western District of Washington. “Effective force reporting and review is essential to addressing the problems that the Department of Justice found in 2011. What this proves is that with strong leadership from the Chief of Police and City leaders, and continued engagement by rank and file officers, Seattle is heading down the road to becoming true leaders in modern police practices.”
As the monitor indicated in the court filing today, SPD officers are “documenting force whenever it is used, sergeants have responded to the scene in such a way that permits a thorough investigation and the FIT investigations are consistently excellent.” However, while chain of command investigations of Type I uses of force were adequate, those for Type II were not found to be in initial compliance. More work will need to be done in that area, and the Department of Justice and the monitor have begun discussions with the city on how to reach compliance in that area as well.
A key requirement of the consent decree is that uses of force by SPD officers are uniformly and accurately reported by officers and thoroughly reviewed by their supervisors, including the chain of command for lower-level uses of force and the FIT for more serious uses of force. The Justice Department’s investigation found that in areas relating to use of force reporting and supervision, there was cursory reporting, inadequate on-scene supervisory investigation of force, insufficient analysis of use of force incidents and too little meaningful oversight and review of force investigations.
The new use of force policy – including a tiered reporting system that requires increased supervision and review of more significant uses of force and new and clearer lines of responsibility for supervisory oversight (including the creation of FIT) – went into effect on Jan. 1, 2014.
Additional assessments, including the quality of Office of Professional Accountability investigations, SPD supervision, stops and detentions, crisis intervention and officer use of force generally will be filed over the next six months. Collectively, these assessments cover every area of the consent decree and will evaluate “whether [SPD] has the systems, policies, structures and culture in place” that the consent decree requires.
Mississippi Woman Pleads Guilty to Making False Statements to New Orleans Immigration CourtRead the Press Release
U.S. Attorney Kenneth A. Polite, Jr. announced that MARINA ARNEDO ROJAS-ZAYED, age 34, a resident of Ocean Springs, Mississippi, pled guilty in federal court today to one count of making false statements to an agency of the United States.
According to court records, from on or about July 2012 until on or about August 2013, ROJAS-ZAYED represented before the New Orleans Immigration Court, that she was a licensed attorney in the state of Alabama, when in truth she knew she was not a licensed attorney. During hearings before the New Orleans Immigration Court, she appeared and assumed the role of attorney for aliens, albeit fraudulently. When Immigration Judges referred to ROJAS-ZAYED as “counsel,” she did not inform the judges that she was not in fact, a licensed attorney. Additionally, ROJAS-ZAYED entered her notice of appearance on behalf of aliens in approximately 42 immigration cases before at least five different Immigration Courts in the United States. Specifically, she submitted numerous documents to the Immigration Courts indicating she was a licensed attorney although she is not.
ROJAS-ZAYED faces a possible maximum term of imprisonment of five years, a $250,000 fine and three years of supervised release following imprisonment. U.S. District Judge Jane Triche Milazzo set sentencing for January 7, 2016.
U.S. Attorney Polite praised the work of the Homeland Security Investigations (HSI). Assistant U.S. Attorney Julia K. Evans is in charge of this prosecution.
Mississippi Man Sentenced for Firearms OffensesRead the Press Release
U.S. Attorney Kenneth A. Polite announced that ALEX BRASINGTON, age 23, a resident of Carriere, Mississippi, was sentenced today after having previously pled guilty to conspiracy to possess and transport stolen firearms in interstate commerce and transportation of stolen firearms in interstate commerce.
U.S. District Judge Jane Triche Milazzo sentenced BRASINGTON to 33 months of incarceration, to be followed by 3 years of supervised release.
According to court documents, in January and February 2013, BRASINGTON, BAUER and PARSONS, transported nine stolen firearms in interstate commerce, from Alabama to Louisiana. The investigation revealed that the firearms had been stolen during residence burglaries in Huntsville, Alabama. On February 14, 2013, agents conducted a search of BAUER’s New Orleans apartment and found five stolen firearms and approximately 1700 rounds of ammunition. Court documents reflect that agents also recovered four stolen firearms and ammunition that BRASINGTON, BAUER and PARSONS sold to individuals in New Orleans. BRASINGTON had previously been found in possession of a stolen firearm on January 31, 2013. BAUER and PARSONS previously pled guilty and are awaiting sentencing.
U.S. Attorney Polite praised the work of the ATF New Orleans Division Office, New Orleans Police Department, Pearl River (LA) Police Department, Pearl River County (MS) Sheriff’s Office, and Huntsville Police Department in investigating this matter. Assistant United States Attorney Nolan D. Paige is in charge of the prosecution.
Minnesota Man Convicted by Federal Jury of Producing Pornographic Images of Two MinorsRead the Press Release
United States Attorney Andrew M. Luger today announced the conviction of SEAN GERALD PENONCELLO, 41, for the production of child pornography involving two minor victims. On June 9, 2015, PENONCELLO was charged by superseding indictment with two counts of producing child pornography and one count of possessing child pornography. Following a three-day trial before Judge Patrick J. Schiltz, a jury found PENONCELLO guilty of all counts. A sentencing date has not yet been set.
Assistant U.S. Attorney Laura Provinzino said: “These are among the most difficult but important cases to prosecute. The jury's verdict ensures that a man who is an opportunist and who has repeatedly sexually exploited children cannot do it again.”
Sergeant John Backman of the St. Louis County Sheriff’s Office said: “This conviction will protect other children from the predatory behavior of Mr. Penoncello. In addition, the conviction sends a message to others involved in this underground activity that they will be pursued, located, and brought to justice.”
As proven at trial, on April 3, 2014, a series of nude images of an unidentified five-year-old minor were submitted to the National Center for Missing and Exploited Children (NCMEC) that were traced back to PENONCELLO’s residence in Cherry, Minn. On March 27, 2015, law enforcement executed a search warrant of PENONCELLO’s residence and recovered two hidden thumb drives and a surreptitious recording device taken from PENONCELLO’s truck.
As proven at trial, the evidence contained on the two thumb drives revealed sexually explicit images and videos of a second minor victim, produced when the victim was 14-years-old. The thumb drives also contained numerous pornographic images and videos of other known NCMEC-identified minor victims.
If you know of any child who may have been a victim of exploitation, please call the National Center for Missing or Exploited Children (NCMEC) at 1-800-THE-LOST (1-800-843-5678) or visit NCMEC’s web site at www.missingkids.com.
This case is the result of an investigation conducted by the Federal Bureau of Investigation and the St. Louis County Sheriff’s Office, with assistance from the St. Louis County Attorney’s Office, Virginia Police Department and Eveleth Police Department.
This case is being prosecuted by Assistant U.S. Attorneys Laura M. Provinzino and Benjamin F. Langner.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, 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.
Defendant Information:
SEAN GERALD PENONCELLO, 41
Iron, Minn.
Convicted:
- Production of Child Pornography, 2 counts
- Possession of Child Pornography, 1 count
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Mexican National Gets 40 Years in Prison for KidnappingRead the Press Release
McALLEN, Texas ‐ A 29-year-old resident of Camargo, Tamaulipas, Mexico, has been handed a significant sentence for his conviction of kidnapping, announced U.S. Attorney Kenneth Magidson along with Acting Special Agent in Charge Mark Dawson of Homeland Security Investigations (HSI) in San Antonio. Martin Margarito-Casimiro pleaded guilty to the charges May 27, 2015.
Today, U.S. District Judge Micaela Alvarez, who accepted the guilty plea, handed Margarito-Casimiro a 480-month sentence and ordered he pay a $25,000 fine. In handing down the sentence, Judge Alvarez noted that this kind of conduct goes on routinely in Mexico and unfortunately is seen more and more in Texas. Judge Alvarez hoped that this sentence would not only serve as a deterrent to Margarito himself, but also to anyone else seeking vengeance for a debt owed. Margarito-Casimiro is expected to face deportation proceedings following his release from prison.
“Today's sentencing exemplifies the high level of collaboration between HSI and its partners in identifying, arresting and prosecuting individuals involved in human smuggling,” said Dawson. “HSI will continue to utilize its broad authorities, in concert with its federal , state/local partners to disrupt and dismantle these criminal organizations.”
On Jan. 22, 2015, law enforcement responded to a man’s cry for help as he ran down the street with rope still tied around his arms and legs. That victim led law enforcement to the McAllen residence where he had been held. There, law enforcement found another victim with his arms and legs bound. At that time, law enforcement discovered Margarito-Casimiro and others who were attempting to flee.
At the time of his guilty plea, Margarito-Casimiro admitted he held at least one victim at gunpoint for ransom for an alleged lost load of marijuana and directed co-conspirators to tie the victim’s hands and feet. The victim was told he needed to pay in order to be released.
Margarito-Casimiro will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The investigation leading to the charges was conducted by Homeland Security Investigations and McAllen Police Department. Assistant U.S. Attorney Kristen Rees and Leo J. Leo prosecuted the case.
Manhattan U.S. Attorney Announces Charges Against Seven Individuals for Multimillion-Dollar Investment SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and Philip R. Bartlett, Inspector-in-Charge of the New York Office of the U.S. Postal Inspection Service (“USPIS”), announced today the unsealing of an indictment charging seven defendants with orchestrating multiple schemes to defraud investors of tens of millions of dollars.
Two of the defendants were arrested this morning in connection with today’s charges. JASON GALANIS was arrested in Manhattan and will be presented later today. JARED GALANIS was arrested in the District of Maryland and will be presented later today before a U.S. Magistrate Judge in Baltimore. DEREK GALANIS is expected to surrender today in the Northern District of California and will be presented before a U.S. Magistrate Judge in San Francisco. GAVIN HAMELS is expected to surrender on Monday in the Southern District of New York and will be presented at that time. JOHN GALANIS, a/k/a “Yanni,” GARY HIRST, and YMER SHAHINI remain at large.
Manhattan U.S. Attorney Preet Bharara said: “As alleged, Jason Galanis and his co-conspirators used their Wall Street credentials and the veneer of a legitimate-sounding financial firm to manipulate the market and fleece investors. Their alleged market manipulation brought them nearly $20 million in profits, but now also a federal indictment.”
USPIS Inspector-in-Charge Philip R. Bartlett said: “Galanis and his co-conspirators exemplified arrogance and contempt for financial regulations when they allegedly devised a scheme to defraud investors to fund a lavish lifestyle. Law enforcement will never tolerate this alleged egregious behavior and will bring those to justice who lie and do not play by the rules.”
According to the Indictment unsealed in Manhattan federal court[1], the defendants engaged in the following fraudulent schemes:
The Gerova Scheme
From 2009 to 2011, JASON GALANIS, JOHN GALANIS, JARED GALANIS, HIRST, DEREK GALANIS, SHAHINI, and HAMELS engaged in a scheme to defraud the shareholders of a publicly traded company called Gerova Financial Group, Ltd. (“Gerova”), and the investing public, by obtaining secret control over millions of shares of Gerova stock and then manipulating the market for the stock as the defendants caused their secretly held shares to be sold.As part of the scheme, the defendants fraudulently generated demand for Gerova stock by bribing investment advisers to purchase for client accounts the Gerova stock that was sold by the defendants, thereby enabling the defendants to cash out from the scheme and make millions in illegal profits.
As a part of the scheme to defraud, JASON GALANIS obtained such control over Gerova so as to be able to cause Gerova to enter into transactions of his design, and for his benefit, including the issuance of Gerova stock.JASON GALANIS obtained this control without identifying himself as an officer or director of Gerova to avoid the SEC-imposed bar that prohibited him from holding such positions at publicly traded companies.Among other means and methods, JASON GALANIS, with the assistance of GARY HIRST, caused more than five million shares of Gerova stock, which represented nearly half the company’s public float and which was intended for JASON GALANIS’s ultimate benefit, to be issued to and held in the name of YMER SHAHINI, who knowingly served as a foreign nominee for JASON GALANIS.JASON GALANIS, JOHN GALANIS, JARED GALANIS, DEREK GALANIS, HIRST, and SHAHINI understood that the purpose of the stock grant to SHAHINI was to disguise JASON GALANIS’s ownership interest in the stock, and to evade the SEC’s regulations for issuing unregistered shares of stock.
At the same time, and as a further part of the scheme to defraud, JOHN GALANIS, JARED GALANIS, and DEREK GALANIS, among others, with the knowledge and approval of JASON GALANIS, opened and managed brokerage accounts in the name of SHAHINI (the “SHAHINI Accounts”), effected the sale of Gerova stock from the SHAHINI Accounts, and received and concealed the proceeds, knowing that this activity was designed to conceal from the investing public JASON GALANIS’s ownership of and control over the Gerova stock.
JASON GALANIS and JARED GALANIS also fraudulently induced investment advisers, including GAVIN HAMELS and others, to purchase shares of Gerova stock in the investment advisers’ client accounts by offering compensation and/or other benefits to the respective investment adviser.By causing the purchase of Gerova stock at the time, quantity, and/or price of their choosing, JASON GALANIS and JARED GALANIS were able to, among other things, effectuate the sale of large quantities of Gerova stock from the SHAHINI Accounts that JASON GALANIS controlled while artificially maintaining the price of Gerova stock through coordinated match trading.Such coordinated trading served to manipulate the market for Gerova stock and deceive the investing public.As a result, JASON GALANIS and his co-conspirators reaped nearly $20 million in profits.
The Scheme to Defraud Clients of Investment Firm-2
From November 2007 to April 2010, JASON GALANIS and JARED GALANIS, along with an investment adviser identified in the Indictment as “CC-2,” participated in a scheme to defraud the clients of CC-2’s investment advisory firm, identified in the Indictment as “Investment Firm-2.”Oftentimes in exchange for compensation from JASON GALANIS and JARED GALANIS, CC-2 caused Investment Firm-2 clients to invest in notes issued by entities associated with JASON GALANIS and JARED GALANIS.
When obligations owed by entities associated with JASON GALANIS and JARED GALANIS became due, CC-2, with the knowledge of JASON GALANIS and JARED GALANIS, used client funds to purchase either notes issued by other entities associated with JASON GALANIS and JARED GALANIS, or publicly traded shares held by such entities.The funds generated were then used to pay the original obligations owed to other Investment Firm-2 clients.Through these securities trades, funds in client accounts of one set of Investment Firm-2 investors were used to pay obligations owed to a different set of Investment Firm-2 investors by entities associated with JASON GALANIS and JARED GALANIS.
* * *
Charts identifying each defendant, the charges, and the maximum penalties are attached to this release. The statutory maximum sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants would be determined by the judge. The case has been assigned to U.S. District Judge P. Kevin Castel.
Mr. Bharara praised the work of the United States Postal Inspection Service and the Federal Bureau of Investigation, and thanked the U.S. Securities and Exchange Commission for its assistance.He added that the investigation is continuing.
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.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Andrew Bauer, Brian Blais, and Dina McLeod are in charge of the prosecution.
The allegations contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
COUNT
CHARGE
DEFENDANTS
MAXIMUM PENALTIES
1
Conspiracy to Commit Securities Fraud (18 U.S.C. § 371)
JASON GALANIS
JOHN GALANIS, a/k/a “Yanni”
JARED GALANIS
GARY HIRST
DEREK GALANISYMER SHAHINI
GAVIN HAMELS
Five years in prison and a $250,000 fine or twice the gross gain or loss from the offense
2
Securities Fraud (15 U.S.C. §§ 78j(b) & 78ff; 17 C.F.R. § 240.10b-5; 18 U.S.C. § 2)
JASON GALANIS
JOHN GALANIS, a/k/a “Yanni”
JARED GALANIS
GARY HIRST
DEREK GALANISYMER SHAHINI
GAVIN HAMELS
20 years in prison and a $5,000,000 fine or twice the gross gain or loss from the offense
3
Conspiracy to Commit Wire Fraud (18 U.S.C. § 1349)
JASON GALANIS
JOHN GALANIS, a/k/a “Yanni”
JARED GALANIS
GARY HIRST
DEREK GALANISYMER SHAHINI
20 years in prison and a $250,000 fine or twice the gross gain or loss from the offense
4
Wire Fraud (18 U.S.C. §§ 1343 and 2)
JASON GALANIS
JOHN GALANIS, a/k/a “Yanni”
JARED GALANIS
GARY HIRST
DEREK GALANISYMER SHAHINI
20 years in prison and a $250,000 fine or twice the gross gain or loss from the offense
5
Investment Adviser Fraud (15 U.S.C. §§ 80b-6 & 80b-17; 18 U.S.C. § 2)
JASON GALANIS
JARED GALANIS
GAVIN HAMELS
Five years in prison and a fine of $10,000
6
Investment Adviser Fraud (15 U.S.C. §§ 80b-6 & 80b-17; 18 U.S.C. § 2)
JASON GALANIS
JARED GALANIS
Five years in prison and a fine of $10,000
7
Investment Adviser Fraud (15 U.S.C. §§ 80b-6 & 80b-17; 18 U.S.C. § 2)
JASON GALANIS
Five years in prison and a fine of $10,000
8
Conspiracy to Commit Securities Fraud (18 U.S.C. § 371)
JASON GALANIS
JARED GALANIS
Five years in prison and a $250,000 fine or twice the gross gain or loss from the offense
9
Securities Fraud (15 U.S.C. §§ 78j(b) & 78ff; 17 C.F.R. § 240.10b-5; 18 U.S.C. § 2)
JASON GALANIS
JARED GALANIS
20 years in prison and a $5,000,000 fine or twice the gross gain or loss from the offense
DEFENDANT
RESIDENCE
AGE
- Jason Galanis
Los Angeles, CA
45
- John Galanis, a/k/a “Yanni”
Oceanside, CA
72
- Jared Galanis
Baltimore, MD
36
- Gary Hirst
Lake Mary, FL
63
- Derek Galanis
Oceanside, CA
43
- Ymer Shahini
Kosovo
45
- Gavin Hamels
Encinitas, CA
39
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth below constitute only allegations, and every fact described should be treated as an allegation.
Man Sentenced to 200 Months in Prison for Drug Trafficking and Gun PossessionRead the Press Release
SYRACUSE, NEW YORK – Brock Yancy, 35, of Syracuse, New York, was sentenced yesterday to serve 200 months (16 years, 8 months) in prison for his convictions for conspiracy to possess with the intent to distribute 280 grams or more of cocaine base (crack cocaine); and possession of a firearm in furtherance of drug trafficking, announced United States Attorney Richard S. Hartunian, Drug Enforcement Administration (DEA) Assistant Special Agent in Charge James Burns, and Syracuse Police Chief Frank Fowler. Chief United States District Judge Glenn T. Suddaby also sentenced Yancy to five years of supervised release following his jail term.
The sentence yesterday stemmed from a joint DEA and Syracuse Police PD investigation begun in 2013 into Yancy’s drug trafficking activities with co-conspirator Dwayne Handy in the Syracuse area. The wiretap investigation culminated on April 15, 2014, when agents arrested Handy and Yancy as they traveled to a drug deal. A search warrant executed at Yancy’s residence resulted in the seizure of over $32,000.00 in drug proceeds. An additional search warrant at a "stash" location the defendants’ utilized on Butternut Street, Syracuse recovered 12 grams of cocaine, several boxes of ammunition and four (4) handguns
This case was investigated by the DEA and Syracuse Police Department, and was prosecuted by Assistant United States Attorney Carla Freedman.
Man Sentenced to 15 Years in Prison for Drug Trafficking and Gun PossessionRead the Press Release
SYRACUSE, NEW YORK – Dwayne Handy, 37, of Syracuse, New York, was sentenced yesterday to serve fifteen years in prison for his convictions for conspiracy to possess with the intent to distribute 280 grams or more of cocaine base (crack cocaine); possession with the intent to distribute over 280 grams or more of crack cocaine, 500 grams or more of cocaine, and heroin; and possession of firearms in furtherance of drug trafficking, announced United States Attorney Richard S. Hartunian, Drug Enforcement Administration (DEA) Assistant Special Agent in Charge James Burns, and Syracuse Police Chief Frank Fowler. Chief United States District Judge Glenn T. Suddaby also sentenced Handy to five years of supervised release following his jail term.
The sentence yesterday stemmed from a joint DEA and Syracuse Police investigation begun in 2013 into Handy’s drug trafficking activities in the Syracuse area. The wiretap investigation culminated on April 15, 2014, when agents arrested Handy and co-conspirator Brock Yancy while they were traveling to a drug deal. Search warrants were executed at their residences, as well as a "stash" location they utilized on Butternut Street, Syracuse, where law enforcement officers recovered over 500 grams (1/2 kilogram) of crack cocaine, 500 grams (1/2 kilogram) of powder cocaine, heroin, and over $10,000.00 in cash in a safe belonging to Handy. Also seized in the search were several boxes of ammunition and four (4) handguns.
This case was investigated by the DEA and Syracuse Police Department, and was prosecuted by Assistant United States Attorney Carla Freedman.
Kern County Residents Indicted for Marijuana Cultivation Operation in National ForestRead the Press Release
FRESNO, Calif. — A federal grand jury returned a seven-count indictment today against Juan Penaloza-Ramirez, aka Juan Penaloza-Herrera, aka Juan Penaloza (Penaloza), 44, of Michoacán, Mexico, residing in Taft, California, and Russell Lee Riggs, 67, of Weldon, charging them with conspiring to manufacture, distribute and possess with intent to distribute, manufacturing, and two counts of possessing with intent to distribute marijuana in connection with a large-scale cultivation operation in the Fay Creek drainage in Tulare and Kern Counties in the Sequoia National Forest, United States Attorney Benjamin B. Wagner announced. Penaloza was also charged with damaging public land and natural resources as a result of the marijuana cultivation activities and being an illegal alien in possession of a firearm. Riggs was charged separately with possessing an unregistered short-barreled shotgun.
According to court documents, it is alleged that Penaloza and Riggs were supplying material, equipment, and personnel to a cultivation site at Fay Creek drainage, which consisted of over 3,000 marijuana plants, and were also responsible for transporting processed marijuana away from the grow site. It is further alleged that the marijuana cultivation operation caused extensive damage to the land and natural resources. Fay Creek supports a variety of ecosystems and resources, including riparian habitat supporting trout, wildflowers and grasses, and willow, alder and cottonwood trees. Fay Creek also serves as the primary drinking water source for many wildlife in the area. Springs were dammed and diverted to irrigate the marijuana plants and large amounts of trash were scattered throughout, including in a flowing stream.
This case is the product of an investigation by the U.S. Forest Service, the U.S. Drug Enforcement Administration, the Bureau of Land Management, the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the Bureau of Alcohol, Tobacco Firearms and Explosives, the Southern Tri-County High Intensity Drug Trafficking Area (HIDTA) task force, California Department of Justice’s Campaign Against Marijuana Planting (CAMP), and the Kern County Sheriff’s Office. Assistant United States Attorney Karen Escobar is prosecuting the case.
Penaloza and Riggs were ordered detained and are scheduled for arraignment on the indictment on September 28, 2015, in federal court in Fresno. If convicted of the most serious drug offenses as charged in counts one through three, Penaloza faces a mandatory minimum statutory penalty of 10 years and a maximum statutory penalty of life in prison and a $10 million fine, and Riggs faces a mandatory minimum statutory penalty of five years and a maximum statutory penalty of 40 years in prison and a $5 million fine. If convicted of the environmental crime, Penaloza faces a maximum statutory penalty of 10 years in prison and a $250,000 fine. If convicted of the firearms offenses, the defendants face a maximum statutory penalty of 10 years in prison. 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 defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
Justice Department and Consumer Financial Protection Bureau Reach Settlement with Hudson City Savings Bank to Resolve Allegations of Mortgage Lending DiscriminationRead the Press Release
Settlement Provides Over $27 Million to Ensure Equal Lending Services to Predominantly Black and Hispanic Communities
The Justice Department and Consumer Financial Protection Bureau (CFPB) filed a consent order today to resolve allegations that Hudson City Savings Bank (Hudson City) engaged in a pattern or practice of “redlining” predominantly Black and Hispanic neighborhoods in its residential mortgage lending practices. “Redlining” is the discriminatory practice by banks or other financial institutions to deny or avoid providing credit services to a consumer because of the racial demographics of the neighborhood in which the consumer lives. This resolution represents the Justice Department’s largest residential mortgage redlining settlement in its history.
The settlement, which is subject to court approval, was filed in conjunction with the agencies’ complaint in the U.S. District Court for the District of New Jersey. The complaint alleges that Hudson City violated the Fair Housing Act and Equal Credit Opportunity Act (ECOA), which prohibit financial institutions from discriminating on the basis of race, color or national origin in their mortgage lending practices. Specifically, the complaint alleges that from at least 2009 to 2013, Hudson City failed to serve the credit needs of majority-Black-and-Hispanic neighborhoods throughout its major market areas, including in New Jersey, New York City and its surrounding counties, and the Philadelphia and Bridgeport, Connecticut, metropolitan areas. Hudson City has agreed to settle this matter without contested litigation.
“This case should send a message to lenders throughout the country that the Justice Department will not tolerate racial discrimination in the extension of credit,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division. “A lending institution must treat all potential borrowers equally, regardless of their race or the racial composition of their neighborhood, when deciding to offer its loan services. We encourage all lenders to proactively identify responsible lending opportunities that exist in predominantly minority neighborhoods within their lending areas.”
“Hudson City Savings Bank structured its business operations to systemically avoid providing credit services in predominantly minority neighborhoods,” said U.S. Attorney Paul J. Fishman of the District of New Jersey. “There is no room for such behavior in our banking system. In addition to paying $25 million for a loan subsidy program, today’s settlement agreement will require the bank to take a number of concrete steps to ensure that they improve access to responsible and affordable credit to qualified borrowers in Black and Hispanic neighborhoods.”
“We allege that Hudson City's redlining practices illegally cut off opportunities for consumers in predominantly Black and Hispanic neighborhoods to get a mortgage and achieve the dream of homeownership,” said CFPB Director Richard Cordray. “Without access to affordable credit, neighborhoods deteriorate in the long shadow cast by unfair lending. Today's action seeks to remove the redline by bringing $27 million in mortgage subsidies and outreach programs, along with new bank branches to the communities who should have had access from the beginning.”
The lawsuit originated from a joint investigation with the CFPB that commenced in March 2015.
Under the terms of the proposed settlement, Hudson City will invest $25 million in a loan subsidy fund to increase the amount of credit the bank extends to majority-Black-and-Hispanic neighborhoods across its market areas. In order to make residential mortgage loans available to residents of minority neighborhoods that were not adequately served by Hudson City, the bank will further invest $2.25 million in advertising, outreach, financial education, and community partnership efforts and open two full-service branches in these neighborhoods. The settlement will require Hudson City to further develop robust internal controls to ensure compliance with fair lending obligations, provide fair lending training to its employees, senior management, and the Board of Directors, and create a comprehensive long-term plan to increase lending in previously redlined areas. Hudson City will further pay a civil monetary penalty of $5.5 million.
The Justice Department’s enforcement of fair lending laws and the Servicemembers Civil Relief Act is conducted by the Housing and Civil Enforcement Section in the Civil Rights Division. Since 2010, the Civil Rights Division has provided approximately $1.3 billion in monetary relief for individual borrowers and impacted communities through its enforcement of the Fair Housing Act, ECOA and the SCRA. The Attorney General’s annual reports to Congress on ECOA enforcement highlight the department’s accomplishments in fair lending and are available at www.justice.gov/crt/publications/.
The Civil Rights Division, the U.S. Attorney’s Office for the District of New Jersey, and the Consumer Financial Protection Bureau are members of the Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information on the task force, visit www.StopFraud.gov.
A copy of the complaint, as well as additional information about fair lending enforcement by the Justice Department, can be obtained from the Justice Department’s website at http://www.justice.gov/fairhousing.
Justice Department and Consumer Financial Protection Bureau Reach Settlement with Hudson City Savings Bank to Resolve Allegations of Mortgage Lending DiscriminationRead the Press Release
Settlement Provides Over $27 Million to Ensure Equal Lending Services to Predominantly Black and Hispanic Communities
NEWARK, N.J. – The U.S. Attorney’s Office for the District of New Jersey, the U.S. Department of Justice Civil Rights Division, and the Consumer Financial Protection Bureau (CFPB) filed a consent order today to resolve allegations that Hudson City Savings Bank (Hudson City) engaged in a pattern or practice of redlining predominantly Black and Hispanic neighborhoods throughout its major market areas with respect to the extension of residential mortgage credit. This resolution represents the Justice Department’s largest residential mortgage redlining settlement in its history.
The settlement, which is subject to court approval, was filed in conjunction with the agencies’ complaint in the U.S. District Court for the District of New Jersey. The complaint alleges that Hudson City violated the Fair Housing Act and Equal Credit Opportunity Act (ECOA), which prohibit financial institutions from discriminating on the basis of race, color, or national origin in their mortgage lending practices. The complaint alleges that from at least 2009 to 2013, Hudson City failed to serve the credit needs of majority-Black-and-Hispanic neighborhoods throughout its lending footprint, including in New Jersey, New York City and its surrounding counties, the Bridgeport, Connecticut, and Philadelphia, Pennsylvania, metropolitan areas, and the City of Camden. Hudson City has agreed to settle this matter without contested litigation.
“Hudson City Savings Bank structured its business operations to systemically avoid providing credit services in predominantly minority neighborhoods. There is no room for such behavior in our banking system,” U.S. Attorney Fishman said. “In addition to paying $25 million for a loan subsidy program, today’s settlement agreement will require the bank to take a number of concrete steps to ensure that they improve access to responsible and affordable credit to qualified borrowers in Black and Hispanic neighborhoods.”
“This case should send a message to lenders throughout the country that the Justice Department will not tolerate racial discrimination in the extension of credit,” Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division, said. “A lending institution must treat all potential borrowers equally, regardless of their race or the racial composition of their neighborhood, when deciding to offer its loan services. We encourage all lenders to proactively identify responsible lending opportunities that exist in predominantly minority neighborhoods within their lending areas.”
“We allege that Hudson City's redlining practices illegally cut off opportunities for consumers in predominantly Black and Hispanic neighborhoods to get a mortgage and achieve the dream of homeownership,’ CFPB Director Richard Cordray said. “Without access to affordable credit, neighborhoods deteriorate in the long shadow cast by unfair lending. Today’s action seeks to remove the redline by bringing $27 million in mortgage subsidies and outreach programs, along with new bank branches to the communities who should have had access from the beginning.”
The lawsuit originated from a joint investigation with the Consumer Financial Protection Bureau that commenced in March 2015.
Under the terms of the proposed settlement, Hudson City will invest $25 million into a loan subsidy fund to increase the amount of credit the bank extends to majority-Black-and-Hispanic areas across its market areas. To enable the bank to make residential mortgage loans available to residents of minority neighborhoods that were not adequately served by Hudson City, the bank will further invest $2.25 million into advertising, outreach, financial education, and community partnership efforts and open two full-service branches in these neighborhoods. The settlement will require Hudson City to develop robust internal controls to ensure compliance with fair lending obligations, provide fair lending training to employees, senior management, and the Board of Directors, and create a comprehensive long-term plan to increase lending in previously redlined areas. Hudson City will pay a civil monetary penalty of $5.5 million.
The Justice Department’s enforcement of fair lending laws and the Servicemembers Civil Relief Act is conducted by the Housing and Civil Enforcement Section in the Civil Rights Division. Since 2010, the Civil Rights Division has provided approximately $1.3 billion in monetary relief for individual borrowers and impacted communities through its enforcement of the Fair Housing Act, ECOA and the SCRA. The Attorney General’s annual reports to Congress on ECOA enforcement highlight the department’s accomplishments in fair lending and are available at www.justice.gov/crt/publications/.Individuals who believe they may have been victims of discrimination may file a complaint with the U.S Attorney’s Office at http://www.justice.gov/usao-nj/civil-rights-enforcement/complaint or call the U.S. Attorney’s Office’s Civil Rights Complaint Hotline at (855) 281-3339.
A copy of the complaint, as well as additional information about fair lending enforcement by the Justice Department, can be obtained from the Justice Department’s website at http://www.justice.gov/fairhousing.
The government is represented by Assistant U.S. Attorneys Michael E. Campion and Svetlana Eisenberg of the District of New Jersey, and Trial Attorney Ronald Lee, U.S. Department of Justice, Civil Rights Division, Housing and Civil Enforcement Section.
The Civil Rights Division, the U.S. Attorney’s Office for the District of New Jersey, and the Consumer Financial Protection Bureau are members of the Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information on the task force, visit www.StopFraud.gov
Jackson Police Officer Charged with ExtortionRead the Press Release
Jackson, Miss – A criminal complaint has been filed against Jackson Police Officer Bryan Jones, 44, of Jackson, charging him with extortion by use of his position as a police officer, announced U.S. Attorney Gregory K. Davis and FBI Special Agent in Charge Donald Alway.
The criminal complaint alleges that Jones used his position as a Jackson Police Officer to extort money. According to the affidavit filed in support of the criminal complaint, Jones assisted drug dealers by conducting illegal traffic stops, searches, and seizures on competitors or rival drug dealers. On April 15, 2015, Jones illegally stopped a vehicle and seized $5,000 from someone he believed to be a drug dealer coming into Jackson to purchase drugs. The affidavit further states that Jones conducted an illegal stop on June 23, 2014 and seized cash from someone he believed to be a drug dealer. The cash taken by Jones on both occasions was never recorded or submitted to the Jackson Police Department; instead the cash was divided between Jones and another person.
United States Attorney Gregory K. Davis praised the efforts of the Federal Bureau of Investigation and would like to thank Chief Lee Vance and the Jackson Police Department for their assistance in this matter.
Jones will appear in federal court for an initial appearance today at 2:00 p.m. before U.S. Magistrate Judge Linda R. Anderson. The offense charged in the complaint carries a maximum sentence of 20 years in prison, and up to a $250,000 fine.
This case will be prosecuted by Assistant U.S. Attorneys Mary Helen Wall and Erin Chalk.
A criminal complaint is not a finding of guilt. An individual charged by criminal complaint is presumed innocent unless and until proven guilty at some later criminal proceedings.
Imperial Business Owner Admits Trafficking in Millions of Dollars of Counterfeit Cell Phone PartsRead the Press Release
Assistant U.S. Attorneys Nicholas Pilchak (619) 546-9709 and Mark Pletcher (619) 546-9714
NEWS RELEASE SUMMARY – September 24, 2015
SAN DIEGO – Imperial Valley businessman Octavio Cesar Sana, a Spanish national with legal U.S. residency, pleaded guilty today to running a years-long conspiracy to traffic in millions of dollars of counterfeit Chinese cell phone parts.
Sana pleaded guilty before U.S. Magistrate Judge William Gallo to conspiring to traffic in counterfeit goods and related money laundering charges. According to the plea agreement, Sana sold at least $3.2 million worth of counterfeit Chinese cell phone parts through businesses he has operated since 2007—including through a website called “Flexqueen.com.”
Sana was arrested February 3, 2015 at the Imperial Valley Airport, along with Chinese national Hongwei Du. Du has also been charged with conspiracy to traffic in counterfeit goods.*
Sana admitted in his plea agreement that he and Du were attending meetings in the United States to set up further counterfeit trafficking ventures. The two were arrested in connection with a multi-year investigation spearheaded by Homeland Security Investigations (HSI) and the Internal Revenue Service, Criminal Investigations. HSI executed a series of searches nationwide coordinated with the arrest of Sana and Du, including Tampa, Florida; Brownsville, Texas; Boston, Massachusetts; Atlanta, Georgia; Pittsburgh, Pennsylvania; Nashville, Tennessee; and Orange, San Diego and Imperial counties in California. These searches resulted in the seizure of more than 55,000 counterfeit items, and additional criminal charges in several jurisdictions.
According to the plea agreement, since 2007, Sana’s businesses have sold approximately $6.5 million of cell phone parts and accessories to businesses and consumers throughout the United States. Sana admitted, however, that roughly half of those parts were counterfeits, sourced almost exclusively from China.
Sana also admitted in his plea agreement that he and his co-conspirators used extensive methods to frustrate the ability of U.S. Customs and Border Protection to detect, inspect and intercept their imported counterfeit goods. An example of such deception included shipping merchandise with “protective stickers” strategically placed to obscure the products’ infringing trademarks. The plea agreement also explains that Sana and Du utilized a dedicated shipping channel for branded goods to avoid attention from Chinese customs officials.
In the United States, Sana admitted that he supervised at least four other individuals who worked at his businesses distributing counterfeit merchandise, including Angela Vela, who also pleaded guilty to separate charges in federal court in El Centro today before Judge Peter Lewis. Sana admitted wiring more than $3.1 million to a bank account in Hong Kong to pay for that merchandise and other items, and acknowledged that at least $3.2 million of merchandise sold by his business since 2007 was fake.
Sentencing for both defendants is scheduled for January 4, 2016 at 8:30 a.m. before U.S. District Judge M. James Lorenz.
As part of his plea agreement, Sana has agreed to forfeit $3.2 million, along with 18 cell phones, 13 computers, and 2 hard drives seized the day of his arrest, and the two website domain names used by his businesses to sell the counterfeits.
“Trafficking in counterfeit goods threatens the integrity of the marketplace,” said U.S. Attorney, Laura E. Duffy. “Consumers who purchase sophisticated electronics equipment bearing a brand name trademark shouldn’t have to run the risk of being fleeced by a counterfeit.” U.S. Attorney Duffy observed that trafficking in counterfeit goods is a profitable and growing criminal industry; U.S. Customs and Border Protection (CBP) reported that in 2014 alone, it intercepted an estimated $1.2 billion of counterfeit goods in more than 23,000 seizures.
Duffy commended the close coordination between the investigating agencies—the Department of Homeland Security, Homeland Security Investigations; the Internal Revenue Service, Criminal Investigations; and the U.S. Postal Inspection Service—during the lengthy investigation of this case. The Department of Justice’s Office of International Affairs also provided invaluable assistance.
“The sale of counterfeit goods not only robs legitimate companies of billions in revenue every year, it also hurts the men and women who depend on those businesses for their livelihoods,” said David Shaw, Special Agent in Charge for HSI San Diego. “Beyond that, intellectual property theft poses a very real public safety threat, by generating proceeds for organized crime and introducing substandard, often dangerous goods into the commerce chain.”
“IRS Criminal Investigation will continue to focus on keeping illicit proceeds out of U.S. banks,” said Special Agent in Charge Erick Martinez. “Today's plea demonstrates the federal government is committed to maintaining the integrity of our financial system.”
Du, the remaining defendant, is next scheduled to appear in court on November 2, 2015.
DEFENDANT Case No. 15-cr-2316-L
Octavio Cesar Sana 42 years old El Centro, CA
CHARGES
Conspiracy to Traffic in Counterfeit Goods - 18 U.S.C. § 371
Maximum penalty: 5 years’ imprisonment and $250,000 fine
Money Laundering Conspiracy – 18 U.S.C. § 1956(h)
Maximum penalty: 20 years’ imprisonment and $500,000 fine
RELATED DEFENDANTS
Case No. 15-cr-526-L
Hongwei “Nick” Du 31 years old Shenzhen, China
Case No. 15-cr-612-L
Angela Rose Vela 36 years old El Centro, CA
AGENCIES
Homeland Security Investigations
Internal Revenue Service – Criminal Investigations
U.S. Postal Inspection Service
*An indictment or complaint is not evidence that the defendants committed the crimes charged. The defendants are presumed innocent until the Government meets its burden in court of proving guilt beyond a reasonable doubt.
Honduran National Sentenced for Illegal Reentry into the United StatesRead the Press Release
U.S. Attorney Kenneth A. Polite announced that JAROL DAVID SOSA-PALMA, age 34, a citizen of Honduras, was sentenced today after pleading guilty to a one-count Indictment for illegal reentry of a removed alien.
U.S. District Judge Nannette Jolivette Brown sentenced SOSA-PALMA to six months in prison followed by one year of supervised release, and a $100 special assessment. Following his incarceration, SOSA-PALMA will be surrendered to the custody of the U.S. Immigration & Customs Enforcement for removal proceedings.
According to the Indictment, on or about May 30, 2015, SOSA-PALMA was found in the United States after having been officially deported and removed on or about June 21, 2013.
U.S. Attorney Polite praised the work of the United States Immigration and Customs Enforcement Agency in investigating this matter. Assistant United States Attorney Spiro G. Latsis was in charge of the prosecution.
Hancock County, WV man sentenced for possessing stolen firearmRead the Press Release
WHEELING, WEST VIRGINIA – Timothy J. Jackson, 56, of Newell, West Virginia, was sentenced today twelve months and one day in prison for possession of a stolen firearm. United States Attorney William J. Ihlenfeld, II, announced.
Jackson was discovered in Hancock County, West Virginia in December 2014 in possession of a stolen .25 caliber semi-automatic pistol. He pled guilty in August 2015 to one count of “Possession of a Stolen Firearm.”
Assistant U.S. Attorney Stephen Vogrin prosecuted the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Hancock, Brooke, Weirton Drug and Violent Crime Task Force, a HIDTA-funded initiative, investigated.
U.S. District Judge John Preston Bailey presided.Glassport Man Charged with Fraud for Purchasing Game Tickets without PayingRead the Press Release
PITTSBURGH – An Allegheny County resident has been indicted by a federal grand jury on charges of wire fraud, United States Attorney David J. Hickton announced today.
The 12-count indictment, returned on Sept. 22, named William B. Rusnock, 35, Glassport, PA, as the sole defendant.
According to the indictment, Rusnock made fraudulent purchases of sporting event tickets on StubHub! without paying for them, defrauding StubHub!, PayPal and Huntington Bank.
The law provides for a total sentence of 20 years in prison, a fine of $250,000, or both for each count of conviction. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the criminal history, if any, of the defendant.
Assistant United States Attorney Gregory C. Melucci is prosecuting this case on behalf of the government.
The United States Secret Service conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Four Men and One Woman Federally Indicted for Robbery of West Bend Jewelry StoreRead the Press Release
Acting United States Attorney Gregory J. Haanstad announced today that five Detroit-area individuals were indicted for the December 29, 2014 robbery of the Husar’s House of Fine Diamonds in West Bend, Wisconsin. Trayvon Shelton (age 24) Charles Leroy Hall (age 28) Gawain Mandeville-Nelson II (age 23) Deangelo Hayes (age 23) and Aliya Rahman (age 21) were charged with one count of Hobbs Act robbery.
The criminal complaints filed against Shelton, Hall, and Mandeville-Nelson II provide a detailed account of the allegations against the defendants. According to the complaints, in the days leading up to the robbery, the defendants traveled from Detroit, Michigan to Wisconsin. On December 29, 2014, the defendants entered the jewelry store armed with sledgehammers and stole a number of Rolex watches. If convicted, each defendant faces up to 20 years in prison on the Hobbs Act robbery count.
Shelton, Hall, and Mandeville-Nelson are currently in federal custody. Hayes and Rahman remain at large.
This matter is being investigated by the FBI’s Milwaukee Area Violent Crimes Task Force and the West Bend Police Department, with assistance from the FBI – Detroit Division and the Eastern District of Michigan United States Attorney’s Office. This case is being prosecuted by Assistant United States Attorney Margaret B. Honrath.
The public is cautioned that an indictment is merely a charge and the defendants are presumed innocent until proven guilty.
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Former mayor of Pratt pleads guilty to selling oxycodoneRead the Press Release
CHARLESTON, W.Va. – Gary Fields, 68, the former mayor of Pratt, West Virginia, admitted to selling the powerful prescription painkiller oxycodone. Fields pleaded guilty today in federal court in Charleston to distribution of oxycodone, announced U.S. Attorney Booth Goodwin.
As part of the plea, Fields admitted that he sold six 15 mg oxycodone pills to a confidential informant on April 23, 2015. Fields is scheduled to be sentenced on January 21, 2016.
The investigation was conducted by the Kanawha County Sherriff’s Department. Assistant United States Attorney Haley Bunn is handling the prosecution.
The prosecution is part of an ongoing effort by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and heroin. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
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Former mayor of Pratt pleads guilty to selling oxycodoneRead the Press Release
CHARLESTON, W.Va. – Gary Fields, 68, the former mayor of Pratt, West Virginia, admitted to selling the powerful prescription painkiller oxycodone. Fields pleaded guilty today in federal court in Charleston to distribution of oxycodone, announced U.S. Attorney Booth Goodwin.
As part of the plea, Fields admitted that he sold six 15 mg oxycodone pills to a confidential informant on April 23, 2015. Fields is scheduled to be sentenced on January 21, 2015.
The investigation was conducted by the Kanawha County Sherriff’s Department. Assistant United States Attorney Haley Bunn is handling the prosecution.
The prosecution is part of an ongoing effort by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and heroin. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
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Former Seminole County High School Teacher Pleads Guilty to Enticement of A Minor and Production of Child PornographyRead the Press Release
Orlando, Florida – United States Attorney A. Lee Bentley, III announces that Gregory A. Vaughn (58, Seminole County) has pleaded guilty to enticement of a minor, and production and receipt of child pornography. He faces 10 years, up to life, in prison, for the enticement charge; a minimum mandatory penalty of 15 years, up to 30 years, for the production charge; and 5 years, up to 20 years, in federal prison for the receipt charge. His sentencing hearing has been set for December 11, 2015.
According to court documents, during a span of two years, Vaughn groomed and persuaded a minor to produce and send him images depicting child pornography. He informed the girl that he wanted to pay for the pictures, and he structured a pay chart for the types of photographs she should take and send to him. Vaughn mailed the girl money, books, candy, clothes, underwear, and makeup in exchange for the pictures she had sent him.
Vaughn’s cellphone and computer were searched pursuant to a state search warrant and agents were able to recover images of the victim and other children from his computer. Agents also interviewed another victim, who also had been groomed and enticed into producing child pornography by Vaughn.
This case was investigated by the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorney Ilianys Rivera Miranda.
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 (CEOS), Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Former Schuylkill County Employee Charged with Embezzling $452,186Read the Press Release
HARRISBURG – The United States Attorney’s Office for the Middle District of Pennsylvania announced today that a former Schuylkill County employee, Virginia G. Kunigonis, age 54, of Pottsville, Pennsylvania, has been charged with embezzling $452,186 from the Schuylkill County Conservation District between 2007 and 2014.
According to U.S. Attorney Peter Smith, an Information filed with United States District Court today in Harrisburg, Kunigonis was charged with one count of Theft From Programs Receiving Federal Funds. The Information alleges Kunigonis forged 437 Conservation District checks totaling $410,435 between October of 2007 and May of 2014. The Information also alleges Kunigonis used a Conservation District credit card to pay an additional $41,751 in personal expenses during that same time period. The Information alleges the Schuylkill County Conservation District received in excess of $10,000 in federal grant monies each year between 2007 and 2014.
The Information was filed pursuant to a plea agreement that was also filed with the Court. In the plea agreement Kunigonis agreed to plead guilty to the one count Information, to cooperate with the government, to make restitution as ordered by the court, and to forfeit the sum of $452,186, all of her interests in her Pottsville, PA residence, and all of her interests in her Schuylkill County retirement account, net of taxes, to the government.
According to the Information, Virginia Kunigonis began working as an administrative assistant for the Schuylkill County Conservation District in approximately 2002. Prior to that she worked in various capacities for Schuylkill County since 1986. No date has yet been scheduled for the entry of Kunigonis’ guilty plea.
The case was investigated by the Scranton Office of the FBI in conjunction with the Pennsylvania State Police and is being prosecuted by Assistant U.S. Attorney Kim Douglas Daniel.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty for Health Care Fraud is 10 years of imprisonment, a term of supervised release following imprisonment, and a fine. The maximum term of imprisonment for False Statements in Health Care Matters is 5 years imprisonment. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Former Miami Springs Police Department Sergeant Sentenced to Nine Years in PrisonRead the Press Release
Former Miami Springs Police Department (MSPD) Sergeant Andres Quintanilla was sentenced today to nine years in prison by U.S. District Court Chief Judge Michael K. Moore. Quintanilla had previously pleaded guilty to receiving bribes from an undercover FBI confidential source, who Quintanilla believed was a narcotics trafficker.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida and George L. Piro, Special Agent in Charge, FBI, Miami Field Office made the announcement.
Andres Quintanilla, 34, had previously pleaded guilty to attempting to affect commerce by extortion under color of official right, in violation of Title 18, United States Code, Section 1951(a). Quintanilla was sentenced to 108 months in prison, to be followed by a year of supervised release. He was also ordered to pay a $5,000 fine and to forfeit an additional $3,700 that had been paid to him by the confidential source.
According to court documents, in October 2014, a FBI confidential source (CS) informed Quintanilla that he (the CS) was a drug trafficker. Rather than arrest the CS, or open an investigation, Quintanilla offered to help the CS’s drug trafficking business. During a series of recorded meetings, Quintanilla offered advice on how the CS should run his drug trafficking business, provided the location of an unmarked Miami-Dade Police Department narcotics office, provided the names of three Miami-Dade Police Department officers, and promised to provide photographs of officers in the future. In addition, Quintanilla ran the name of a purported drug dealer in a law enforcement database when asked to do so by CS.
By December 2014, Quintanilla had agreed to act as an escort during a purported 10 kilogram cocaine deal. Under FBI direction, the CS told Quintanilla that the CS needed a safe location in Miami Springs where the CS could exchange 10 kilograms of cocaine for $250,000. Quintanilla chose a location for the transaction to take place and, on the date of the transaction, the FBI filmed and recorded Quintanilla meeting with the CS and viewing the cocaine. After the purported deal took place with second undercover CS acting as a drug dealer, Quintanilla then followed the CS’s vehicle to an express package service center, where Quintanilla believed that the CS would ship the $250,000 of drug proceeds to New York. Quintanilla participated in the transaction in uniform, while driving his MSPD marked vehicle. In exchange for his assistance, Quintanilla accepted $3,500 in bribe payments.
Mr. Ferrer commended the investigative efforts of the FBI Miami Area Corruption Task Force. This case is being prosecuted by Assistant U.S. Attorney Anthony Lacosta.
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.