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14 September 2015
St. Thomas Man Pleads Guilty to Possession of Firearm by Convicted FelonRead the Press Release
St. Thomas, USVI – On Monday, September 14, 2015, Lued Browne, 44, pleaded guilty in District Court on St. Thomas to Possession of a Firearm by a Convicted Felon, United States Attorney Ronald W. Sharpe announced. Sentencing is scheduled for January 4, 2016.
According to the plea agreement filed with the court, on May 22, 2015, Virgin Islands Police Department officers responded to a report that a vehicle was blocking the exit at Antilles School. Upon arrival at the scene, officers observed Browne, the sole occupant of the vehicle, sitting in the driver’s seat of the vehicle. The officers also observed a firearm between the driver’s seat and center console of the vehicle, which they immediately confiscated. Further investigation revealed that Browne has a prior felony conviction and could not legally possess a firearm in the Virgin Islands. Browne faces a maximum sentence of 10 years in prison and a $250,000 fine.
This case is the result of a joint investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Virgin Islands Police Department. It is being prosecuted by Assistant United States Attorney Sigrid M. Tejo-Sprotte.
St. Thomas Man Pleads Guilty to Firearm Conspiracy ChargeRead the Press Release
St. Thomas, USVI – On Monday, September 14, 2015, Ja’moi Khadeem Corraspe, 22, pleaded guilty in District Court on St. Thomas to Conspiracy to Ship Firearms with Obliterated Serial Numbers, United States Attorney Ronald W. Sharpe announced. Sentencing is scheduled for January 4, 2016.
According to the plea agreement filed with the court, between August 6, 2013 and October 7, 2013, Corraspe conspired with other individuals to unlawfully mail firearms with obliterated serial numbers from Jacksonville, Florida to St. Thomas. He directed the shipping of two firearms from Jacksonville to St. Thomas: a Smith and Wesson, Model SD40VE, .40 caliber pistol and a Glock, Model 20, 10mm pistol, both with obliterated serial numbers. Corraspe is not a federal licensed firearms dealer and is not authorized to possess the two firearms in the District of the Virgin Islands. He faces a maximum sentence of five years in prison and a $250,000 fine.
This case is the result of a joint investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the U.S. Postal Inspection Service. It is being prosecuted by Assistant United States Attorney Sigrid M. Tejo-Sprotte.
Springfield Man Pleads Guilty to $1.1 Million Investment Fraud SchemeRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Springfield, Mo., man pleaded guilty in federal court today to a more than $1.1 million investment fraud scheme.
Christopher Hanson, 53, of Springfield, waived his right to a grand jury and pleaded guilty before U.S. Magistrate Judge David P. Rush to a two-count information that charges him with wire fraud and money laundering. Hanson is the owner of Hanson Holdings, LLC.
By pleading guilty today, Hanson admitted that he was responsible for losses that totaled $1,134,500 for three victims of his investment fraud scheme.
Hanson offered the three victims what he described as “an investment opportunity.” Hanson told two of the victims that he would take their investment monies and purchase a collateralized mortgage obligation (CMO). Hanson claimed that a line of credit would be obtained against the CMO and both victim investors would receive their original investment plus a substantial dividend within months. Hanson told the third victim that he would purchase bonds and securities with his $100,000 investment. Hanson claimed this investment would generate a 250 percent return and that the victim investor would receive double his original investment within 40 weeks.
According to today’s plea agreement, financial records revealed that none of the monies obtained by Hanson or Hanson Holdings from these three investors were used to purchase securities or a CMO as Hanson had promised. Agents determined that Hanson authorized the release of the investors’ monies from his Scottrade Account, ETrade Account, or StockCross Account, into his personal bank accounts. The monies were then used to either pay other investors or pay expenses that were completely unrelated.
Under federal statutes, Hanson is subject to a sentence of up to 30 years in federal prison without parole, plus a fine up to $500,000 and an order of restitution. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Patrick Carney. It was investigated by the FBI and IRS-Criminal Investigation.
Sarasota Man Sentenced to Prison for Investment FraudRead the Press Release
Tampa, FL –U.S. District Judge Elizabeth A. Kovachevich has sentenced Gaeton Della Penna (62, Sarasota) to five years and ten months in federal prison for mail and wire fraud related to an investment scheme. As part of his sentence, the court ordered restitution for his victims and entered a money judgment of more than $2.8 million, representing the proceeds of fraud. Della Penna pleaded guilty on May 5, 2015.
According to court documents, Della Penna enticed investors to invest in his “investment funds” by guaranteeing them at least 5% yearly interest on their investment, with the principal to be returned at the end of an 18-month period, minus a nominal management/organizational fee paid to Della Penna, plus any trading profits. These representations were false. Rather than making profitable trades and protecting investors’ principal, Della Penna used a portion of the investors’ money for trading, lost money in his trades, and misappropriated the rest of the investors’ money by using it to repay other investors’ principal. False statements and “quarterly” interest checks were sent to the investors to entice them to invest more money. Della Penna also paid personal expenditures with the investors’ money, including mortgage payments on his waterfront residence.
This case was investigated by the United States Secret Service and the Sarasota Police Department. It was prosecuted by Assistant United States Attorney Kelley Howard-Allen.
Rhode Island Man Sentenced to Five Years in Prison for Masterminding Bank Fraud Conspiracy, Identity Theft, Passing Counterfeit MoneyRead the Press Release
PROVIDENCE, R.I. – David Alcantara, 33, of Warwick, has been sentenced to 60 months in federal prison for masterminding an elaborate conspiracy to defraud two Rhode Island banks of nearly $600,000, by using stolen personal identifying information of several unsuspecting individuals, announced United States Attorney Peter F. Neronha and Ted A. Arruda, Resident Agent in Charge of the Providence Office of the U.S. Secret Service.
A federal court jury convicted Alcantara on May 1, 2015, of leading the conspiracy to defraud the banks and for leading a conspiracy to convert counterfeit $100 bills into real American dollars by making small retail purchases with bogus $100 bills and receiving cash back in Rhode Island, Massachusetts and Connecticut.
The jury convicted Alcantara of conspiracy to commit bank fraud, eight counts of aggravated identity theft and conspiracy to pass counterfeit money.
According to the government’s evidence presented at trial, in December 2009 and January 2010, Alcantara’s schemes resulted in the transfer of over $600,000 from bank accounts of legitimate bank customers into accounts fraudulently created with the use of several individuals’ stolen identities. Money was then withdrawn from the fraudulent accounts in the form of cashier’s checks.
In one scheme, Alcantara was responsible for the use of stolen identifying information belonging to a small business owner in Harrisburg, Pennsylvania, to affect in Rhode Island the transfer of $250,000 from the company’s business account into a newly opened fraudulent bank account. The account was opened using stolen identifying information of an individual who is deceased.
In a second scheme, Alcantara provided others with stolen identifying information of unsuspecting individuals and instructed them on how to use the information to establish fraudulent bank accounts at several branch offices of the same bank. Alcantara also provided them with stolen identifying information of legitimate owners of existing accounts at the same bank and instructed them to transfer funds from the legitimate accounts into the fraudulent accounts.
According to the government’s evidence, at the same time that Alcantara was affecting the bank fraud schemes, he reached out to an individual he thought could assist him in obtaining fraudulent Massachusetts drivers’ licenses. The individual he reached out to was in fact an undercover DEA agent. The DEA agent, working in conjunction with U.S. Secret Service Agents who were investigating Alcantara and the bank fraud schemes and the passing of bogus $100 bills, recorded several conversations he had with Alcantara as he attempted to secure the fraudulent IDs.
Alcantara has been detained since the date of his conviction.
The case was prosecuted by Assistant U.S. Attorneys Sandra R. Hebert and Lee H. Vilker.
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Contact:
Jim Martin (401) 709-5357
email: [email protected]
on Twitter @USAO_RI
Retired Sheriff’s Deputy Guilty of Firearm ChargeRead the Press Release
RICHMOND, Va. – Melvin Hinson, 56, of Kinsale, pleaded guilty today to the charge of possession of firearms with obliterated, removed, or altered serial numbers.
In a statement of facts filed with the plea agreement, Hinson, a retired Westmoreland County Sheriff’s deputy, admitted that starting before March 2014, and continuing through and including March 19, 2014, he received firearms from law enforcement agencies for the purpose of destroying the firearms for the agencies. But instead of destroying the firearms, Hinson removed the serial numbers from the firearms and sold or traded them. According to the statement of facts, there were eight firearms involved, including a sawed-off shotgun and a sawed-off rifle. All eight of the firearms entrusted to Hinson for destruction have been recovered by law enforcement.
Hinson, who was indicted by a federal grand jury on May 5, 2015, faces a maximum penalty of five years in prison when sentenced on Dec. 18, 2015. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and J.D. Durastanti, Assistant Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), made the announcement after the plea was accepted by U.S. District Judge John A. Gibney. Assistant U.S. Attorney Olivia L. Norman is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:15-cr-081.
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Pawtucket, R.I., Man Detained on Federal Firearm, Drug Trafficking ChargesRead the Press Release
PROVIDENCE, R.I. – Jose Gomez, 26, of Pawtucket, has been ordered detained in federal custody following an investigation into Gomez’s alleged trafficking of crack cocaine, including the alleged trading of firearms for crack cocaine, announced United States Attorney Peter F. Neronha and Daniel J. Kumor, Special Agent in Charge of the Boston Field Division of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).
The investigation included three undercover purchases of crack cocaine allegedly from Gomez and a court authorized search of Gomez’s residence. Inside Gomez’s residence, law enforcement located a one-year-old child and a two-year-old child unattended in a bedroom where they also allegedly discovered approximately four grams of crack cocaine on a window sill.
Gomez is detained on a criminal complaint charging him with three counts of distribution of crack cocaine, one count of possession with the intent to distribute crack cocaine, one count of being a felon in possession of a firearm and one count of possession of a firearm in furtherance of a drug trafficking crime.
According to court documents and information presented to the court, it is alleged that on two occasions between August 31 and September 3, 2015, Gomez sold nearly three grams of crack cocaine for $200 in cash to an undercover ATF agent. Both transactions alleged occurred outside of Gomez’s Pawtucket residence.
According to court documents and information presented to the court, on September 8, 2015, the ATF undercover agent allegedly arranged with Gomez to trade two firearms for $200 in cash and a quantity of crack cocaine. The two met outside of Gomez’s residence two days later, and moments after Gomez allegedly exchanged $200 in cash and a plastic bag containing crack cocaine for the two firearms, a .380 caliber handgun and a 9mm handgun, agents detained Gomez.
According to information presented to the court, a court authorized search of Gomez’s residence moments after Gomez was detained allegedly resulted in the discovery of approximately four grams of crack cocaine on a digital scale stored on a window sill inside a bedroom where two unattended children, aged one and two, were located. The bedroom doorway was blocked to prevent the unattended children from leaving the room.
A criminal complaint is merely an allegation 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.
ATF was assisted in the investigation of this matter by Pawtucket Police, Central Falls Police and the Special Investigations Unit of the Adult Correctional Institutions.
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Contact:
Jim Martin (401) 709-5357
email: [email protected]
on Twitter @USAO_RI
Pastor Sentenced for Filing False Tax ReturnsRead the Press Release
BOSTON – A former Worcester tax preparer was sentenced today for filing false tax returns with the IRS.
Nydia Elicier, 56, owner of Cox Elicier Tax, was sentenced by U.S. District Court Judge Timothy Hillman to two years of probation, the first three months of which she is restricted by location monitoring, and 100 hours of community service. Elicier is also prohibited from working as a tax preparer. In April 2015, Elicier was convicted following a four-day jury trial of four counts of aiding or assisting in the preparation of false tax returns.
In 2008, Elicier, who also served as a pastor in a Worcester congregation, inflated client refunds by falsifying deductions in filings with the IRS. Specifically, Elicier generated illegal refunds for clients by claiming deductions typically reserved for educators, false gifts to charity, overinflated medical expenses, and fraudulent unreimbursed employee expenses.
United States Attorney Carmen M. Ortiz and William P. Offord, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Jordi de Llano of Ortiz’s Major Crimes Unit.
Nixa Woman Sentenced to 20 Years for Sexual Exploitation of Two ChildrenRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Nixa, Mo., woman was sentenced in federal court today for sexually exploiting two children to produce child pornography, which she distributed over the Internet.
Meagan Nell Bowman, 26, of Nixa, was sentenced by U.S. Chief District Judge Greg Kays to 20 years in federal prison without parole. The court also sentenced Bowman to supervised release for the rest of her life following incarceration.
On Dec. 11, 2014, Bowman pleaded guilty to all four counts of a federal indictment that charge her with two counts of sexually exploiting a minor and two counts of receiving and distributing child pornography.
Bowman’s estranged husband discovered photographs in her e-mail account of her sexual abuse of a 3-year-old child and a 2-year-old child. Bowman admitted that she was communicating over the Internet with two unknown men whom she met after posting an advertisement on Craigslist. She then used her cell phone to take photos of herself sexually abusing the 3-year-old child and sent them to the two men. She also admitted that 32 images of child pornography found on her cell phone were created by herself or received from the men she was interacting with over the Internet.
This case was prosecuted by Assistant U.S. Attorney Patrick Carney. It was investigated by the FBI and the Nixa, Mo., Police Department.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Nigerian Man Sentenced to 12.5 Years in Prison for Operating Sophisticated $13 Million Internet Fraud SchemeRead the Press Release
PHOENIX – Today, Alex Sualim, 44, of Toronto, Canada, was sentenced by U.S. District Judge Susan R. Bolton to 12.5 years (150 months) in prison and ordered to pay over $13 million in restitution. Sualim previously pleaded guilty to conspiracy to commit wire fraud.
“We want to thank our law enforcement partners for their diligence during this multi-year investigation, which resulted in the successful identification, arrest, and prosecution of a foreign national who was using advanced technological tools to prey on American victims,” stated U.S. Attorney John S. Leonardo. “We remain committed to aggressively prosecuting those who would engage in fraud and cyber-crime.”
“The defendant operated a sophisticated, international fraud scheme that spanned four continents and swindled millions of dollars from more than a dozen victims. The lengthy prison sentence reflects the severity of his egregious crimes. IRS-CI will continue to work with its international law enforcement partners to investigate transnational organized crime,” stated IRS-Criminal Investigation (IRS-CI) Special Agent in Charge Ismael Nevarez Jr.
“The defendant wrongly believed being outside the United States gave him the freedom to carry out his criminal activities. The FBI remains committed to pursue these criminals wherever they may hide. This case is a fine example of the partnership the FBI has with our international law enforcement partners through our legal attaches, as well as with domestic law enforcement agencies-all working together to bring justice on behalf of our citizens.” stated FBI Special Agent in Charge Douglas Price.
Between 2009 and 2013, Sualim helped operate a fraud scheme that spanned four continents and duped more than a dozen victims out of more than $13 million. The scheme’s details were unusually sophisticated. First, Sualim would create a website for a Canadian company that purported to manufacture semiconductor chips. Next, Sualim would create passports, email accounts, and toll-free phone numbers for the Canadian company’s supposed employees. And next, Sualim would send millions of solicitation emails—on behalf of the supposed Canadian employees—to Americans whose email addresses he’d purchased from a spam vendor. These emails would explain that the Canadian company needed a product called “silicon germanium” to manufacture its semiconductor chips, that the company wished to enlist an American distributor to obtain the product from China, and that the Canadian company would cover the entire upfront cost of the product. If a victim expressed interest in this seemingly risk-free arrangement, he would be sent a series of additional emails accompanied by professional-looking purchase orders, proposed contracts, and other documents designed to give the transaction a veneer of legitimacy. Finally, on the eve of the first shipment from China, the victim would be told that the Canadian company’s financing had unexpectedly fallen through and that the American distributor needed to supply some of the upfront cost, after all.
If a victim agreed to this new arrangement, he’d be told how to wire his portion to an overseas bank account (typically located in Cyprus, Greece, Hong Kong, or China). Next, Sualim would arrange for a supposed employee of the Chinese manufacturer (who, in reality, was one of Sualim’s co-conspirators) to call or email the victim and explain that his company had just been purchased by a new parent company that required a larger minimum order. These victims were told they needed to wire more money to the overseas bank account in order to complete the first order. Many victims fell for this ruse and sent more money (sometimes several times). Finally, in the last iteration of the scheme, Sualim would arrange for large packages to be shipped to victims, who were told the packages contained the silicon germanium but were cautioned not to open the packages because silicon germanium is a highly-unstable material that can only be handled in a sterile laboratory environment. In fact, the packages were filled with worthless filler material. Nevertheless, some victims fell for the ruse, believed they were receiving the contracted-for product, and kept wiring more money to the designated overseas bank account in the hope of obtaining more shipments. Once victims discovered they were being scammed and demanded answers, their supposed Chinese and Canadian counterparts would simply stop responding to emails and phone calls.
During the operation of the scheme, Sualim—a college-educated electrical engineer who hails from Nigeria—lived in a multi-million dollar waterfront home in Toronto and had a fleet of luxury vehicles, including a Porsche, a Mercedes, and a Tesla that cost more than $100,000. Under his plea agreement, Sualim agreed to liquidate, for the benefit of victims, more than $2 million of Canadian assets.
The investigation in this case was conducted by the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation, with assistance from the Royal Canadian Mounted Police. The prosecution was handled by Dominic Lanza and Peter Sexton, Assistant U.S. Attorneys, District of Arizona, Phoenix.
CASE NUMBER: CR-13-1515-PHX-SRB
RELEASE NUMBER: 2015-070_Sualim
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For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.
New York Man Sentenced for Possession of Fraudulent Credit Cards and Aggravated Identity TheftRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced that U.S. District Court Judge Robert D. Mariani sentenced Robert Cagle, age 50, Bronx, New York on Friday, September 11, 2015 to 48 months imprisonment. Cagle pled guilty in April 2015 to possession of fraudulent credit cards and aggravated identity theft.
According to U.S. Attorney Peter Smith, a Criminal Information was filed in March 2015 charging Cagle with access device fraud and aggravated identity theft. Allegedly, in April 2014, Pennsylvania State Police conducted a search of a disabled vehicle on Interstate 81. Cagle, a passenger in the vehicle, was found to be in possession of 71 fraudulent credit/debit cards, as well as equipment intended to be used for the manufacture of the counterfeit devices.
In addition to the prison term, Judge Mariani also ordered that Cagle be supervised by a probation officer for three years following his release from prison.
The case was investigated by the U.S. Secret Service and the Pennsylvania State Police and prosecuted by Assistant United States Attorney Michelle L. Olshefski.
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Navajo Man from Yatahey, N.M., Pleads Guilty to Federal Child Sexual Abuse ChargesRead the Press Release
ALBUQUERQUE – David Castillo, 38, an enrolled member of the Navajo Nation who resides in Yatahey, N.M., pleaded guilty this morning in federal court in Albuquerque, N.M., to a felony information charging him with two counts of aggravated sexual abuse of a child. Under the terms of his plea agreement, Castillo will be sentenced to 20 years in federal prison followed by a term of supervised release to be determined by the court. Castillo also will be required to register as a sex offender.
Castillo was arrested May 17, 2015, on a two-count indictment charging him with aggravated sexual abuse of a child under the age of 12 on a date between May 1, 2006 and Sept. 4, 2006, and again on a date between Dec. 20, 2006 and Jan. 8, 2007, in Indian Country in McKinley County, N.M.
During today’s change of plea hearing, Castillo pled guilty to a two-count felony information charging him with aggravated sexual abuse. In entering his guilty plea, Castillo admitted sexually assaulting the victim in the summer of 2006, when the victim was eight years old. He also admitted sexually assaulting the victim over the Christmas holiday in 2006, when the victim was nine years old. According to the plea agreement, Castillo sexually assaulted the victim five times during the periods of time and that the he committed the crimes on the Navajo Indian Reservation.
Castillo has been in federal custody since his arrest and remains detained pending his sentencing hearing which has yet to be scheduled.
This case was investigated by the Gallup office of the FBI and the New Mexico State Police and is being prosecuted by Assistant U.S. Attorney Sarah Mease.
The case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice (DOJ) to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and DOJ’s Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
Milwaukee Man Sentenced on Federal Gun Charge as an Armed Career CriminalRead the Press Release
Gregory J. Haanstad, Acting U.S. Attorney for the Eastern District of Wisconsin, announced that Justin King Nalls (age: 27) of Milwaukee, Wisconsin, appeared in federal court in Green Bay and was sentenced to 180 months in federal prison for being a felon in possession of a firearm. Based on his criminal record of violent felonies, Nalls qualified as an Armed Career Criminal under federal law which required that he be sentenced to not less than 15 years and up to a lifetime in prison. He was convicted in state court of two armed robberies in 2005 and a burglary in 2009.
Nalls was arrested in October of 2014 for his role in the armed robbery of a Kewaunee County tavern. Further investigation linked Nalls to an additional armed robbery in Sheboygan County and a violent robbery in the City of Milwaukee. Nalls and a female associate placed ads offering prostitution services online, and then robbed at gunpoint those who responded to the advertisements. A search of Nalls’ residence and vehicle yielded a loaded .44 revolver and ammunition for a .357 caliber firearm, both of which are illegal for Nalls or any felon to possess.
In pronouncing sentence, Chief U.S. District Court Judge William C. Griesbach noted the need to protect the community from future criminal acts, the need to send a strong message of deterrence to others, as well as the substantial penalties that the U.S. Congress ascribes to individuals like Nalls with violent felony convictions in their past.
The case was investigated by the Kewaunee County Sheriff’s Department, the City of Kewaunee Police Department, the Kewaunee County District Attorney’s Office, the Wisconsin Department of Justice - Division of Criminal Investigation, and the U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF). It was prosecuted by Assistant United States Attorney Daniel R. Humble.
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Michigan Man Sentenced for Production of Child Pornographyand CyberstalkingRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051BUFFALO, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that James S. Allen, 38, of New Baltimore, MI, who was convicted of production of child pornography and cyberstalking, was sentenced to 262 months in prison and 10 years supervised release by U.S. District Judge Richard J. Arcara.
"This shocking case demonstrates how technology can make our children more vulnerable than ever to predators", said U.S. Attorney Hochul. "Parents, children, and in fact any who use internet-based media, need to know how to protect themselves from those inhabiting this virtual world."
Assistant U.S. Attorneys Aaron J. Mango and Scott S. Allen, who handled the case, stated that between April and August of 2012, the defendant utilized the internet and text messages to stalk, communicate with, and threaten 18 female victims in the Western District of New York, many of them minors, in an effort to obtain pornographic pictures of the minors. Allen contacted the victims and told them that he found naked pictures of them on the internet. The defendant then directed the victims to a specific website to view the pictures. In reality, the website was a front or a phishing site by which the defendant sought to surreptitiously obtain the victim’s private e-mail address and password.
Once the targeted victim input the requested information, the victim’s personal e-mail addresses and passwords went straight to the defendant via the internet. Allen then seized control of the victim’s e-mail accounts, contacted the victims, and threatened that if they did not engage in a Skype video chat with him, he would distribute naked photos of the victims over the internet. Once a victim and the defendant logged onto Skype (the defendant utilized the screen name “shhh.shhh,” Allen further demanded that the victims take their clothes off and engage in sexual conduct, with the additional threat that naked pictures of them would be sent out to all of Western New York if the girl did not comply. As a result of the defendant's repeated and sustained harassment of the victims, many victims suffered substantial emotional distress.
The sentencing is the culmination of an investigation by on the part of Special Agents of the Federal Bureau of Investigation’s Child Exploitation Task force which includes the Buffalo Police Department, the Cheektowaga Police Department, and the Niagara County Sheriff’s Office, and the Kenmore Police Department, under the direction of Chief Peter Breitnauer. Additional assistance was also provided by the FBI Forensic Laboratory in Quantico, Virginia, and the Western New York Regional Computer Forensic Laboratory.
Miami Resident Sentenced in Stolen Identity Tax Refund Fraud SchemeRead the Press Release
Kiesha Adderly Mitchell, 36, of Miami, was sentenced by U.S. District Court Judge Darrin P. Gayles to 48 months in prison, to be followed by three years of supervised release, for her participation in a stolen identity tax refund fraud scheme. Mitchell was also ordered to pay restitution in the amount of $219,721.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), made the announcement.
The same sentence was imposed upon Mitchell’s co-defendant, Melissa Pearl Davis, 32, on August 20, 2015.
Defendants Mitchell and Davis each previously pled guilty to one count of conspiracy to defraud the government with respect to claims, in violation of Title 18, United States Code, Section 286, and one count of aggravated identity theft, in violation of Title 18, United States Code, Sections 1028A(a)(1) and 2. As part of their pleas, each defendant agreed to pay restitution in the amount of $219,721.
According to court documents, in 2009, the defendants applied to the Internal Revenue Service (“IRS”) for Electronic Filing Identification Numbers (“EFINs”) in the name of corporate or fictitious entities they controlled, including K. Mitch Services, Inc. and Pebbles Tax & Notary Services. The defendants used those EFINs to submit false and fraudulent federal income tax returns to the IRS, using the names and Social Security numbers of other individuals, without the taxpayers’ authority. After the tax returns were received by the IRS, various financial institutions would authorize the defendants to load onto debit cards refund anticipation loans in the names of tax payers whose names and Social Security numbers were used to file the false and fraudulent tax returns. The defendants then withdrew the unlawfully obtained tax proceeds from the debit cards for their personal use and enrichment. The total intended loss from the defendants’ false and fraudulent filings of unauthorized income tax returns was over $400,000.
Mr. Ferrer commended the investigative efforts of the South Florida Identity Theft Tax Fraud Strike Force, with special commendation to the FBI and IRS-CI. This case is being prosecuted by Assistant U.S. Attorney Maurice A. Johnson.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Maple Heights man sentenced to 15 years in prison for firearms convictionRead the Press Release
A Maple Heights man was sentenced to more than 15 years in prison for illegally possessing firearms and counterfeit currency, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio, and Donald Soranno, Special Agent in Charge of ATF's Columbus Field Division.
Daunte Byrd, 29, was sentenced to 182 months in prison after previously being found guilty of being a felon in possession of a firearm and possession of counterfeit currency.
Byrd was arrested in October 2014 and found to have $5,850 in counterfeit currency and a loaded 9 mm handgun. Byrd was prohibited from having firearms or ammunition because of multiple felony convictions, including several convictions involving violence and a firearm.
Byrd was convicted as part of Operation Samson II, an enhanced enforcement initiative targeting the criminal possession, use and sale of firearms in Greater Cleveland. The summer-long initiative organized around three operational groups. The first used undercover operations to investigate people known to criminally possess, use and sell firearms, as well as people possessing firearms while conducting drug activities. The second group used firearms trace data and ballistics information from the National Ballistics Information Network to pursue leads related to firearms that have been diverted from legal commerce to criminal use. The third group involved ATF Industry Operations conducting inspections at Cleveland-area federal firearms licensees to ensure that dealers are selling firearms in accordance with federal law and regulations.
Byrd told a confidential information in August 2014 that he could obtain and sell firearms, as well as grenades. Byrd also expressed interest in the robbery of a drug stash house. He also discussed selling fraudulent heroin and counterfeit currency, according to court documents.
This case is being prosecuted by Assistant U.S. Attorney Kelly L. Galvin following an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Cleveland Division of Police.
Mansfield Man Charged in Armed Robbery of Grandview BankRead the Press Release
DALLAS — A Mansfield, Texas, man has been charged in a federal criminal complaint with committing the takeover-style, armed robbery last week of the Grandview Bank in Grandview, Texas, announced U.S. Attorney John Parker of the Northern District of Texas.
Michael Dwayne Bailey, 41, made his initial appearance this afternoon before U.S. Magistrate Judge David L. Horan, who ordered that he remain in custody pending a detention hearing set for Friday, September 18, 2015, at 2:00 p.m.
According to the complaint, on Thursday, September 10, 2015, at approximately noon, a man wearing a Texas Longhorns baseball cap, sunglasses, black leather jacket, dark glasses, and subsequently identified as the alleged robber, entered the Grandview Bank located at 105 East Criner Street. He approached a teller, who noticed he was wearing a dark bandana over the lower half of his face, pointed a handgun at the teller, and demanded money.
In fear for her life, the teller froze. The robber climbed on the counter and through the teller window and pointed the handgun directly at the teller’s face, and repeated his demand. Again, fearing for her life, the teller began withdrawing cash from her cash drawer, and the robber reached into the drawer and began grabbing money. The teller handed the money to the robber who took all of it and ran out of the bank. By this time, other bank employees had called 911. An observer saw the robber run to a red, two-door coupe with disabled veteran plates and notified law enforcement.
Acting on the tip, an officer with the Alvarado Police Officer caught up with the robber and activated his red and blue lights and siren, signaling the robber to stop, but the robber did not pull over. Instead, a high-speed pursuit ensued, and officers from several police agencies joined the Alvarado Police Department. They pursued the robber to the city of Mansfield, Texas, and during the pursuit, the robber drove on the wrong side of the road on I-35 and onto the shoulder before ultimately blowing a tire. Speeds even reached 150 miles per hour during the pursuit. The robber and a female passenger were both arrested.
At the time of his arrest, Bailey was wearing a Texas Longhorns ball cap, sunglasses, a black leather jacket and dark pants. The police also recovered the dark-colored bandanna. Knowing the robber was armed, officers searched the car and located a Smith & Wesson 9 millimeter handgun loaded with hollow-point ammunition.
The female passenger was identified as Bailey’s 19-year-old daughter. Officers located the exact amount of cash stolen in the robbery in her purse.
A federal complaint is a written statement of the essential facts of the offenses charged, and must be made under oath before a magistrate judge. A defendant is entitled to the presumption of innocence until proven guilty. If convicted of this offense, however, Bailey faces up to 25 years in federal prison and a $250,000 fine. The U.S. Attorney’s office has 30 days to present the matter to a grand jury for indictment.
The FBI, Alvarado Police Department and Mansfield Police Department are investigating. Deputy Criminal Chief Assistant U.S. Attorney Gary Tromblay is prosecuting.
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Manhattan U.S. Attorney Announces Charges Against Florida Man for Attempting to Gain Unauthorized Access to the Computer Network of A Global Charitable OrganizationRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York and Robert J. Sica, the Special Agent in Charge of the New York Office of the United States Secret Service (“USSS”), announced today the filing of a criminal complaint against TIMOTHY SEDLAK for attempting to gain unauthorized access to the computer network of a global charitable organization based in New York, New York (the “Organization”). SEDLAK was arrested in Ocoee, Florida in the evening of September 11, 2015. He will be presented later today in federal court in Orlando, Florida before United States Magistrate Judge Gregory J. Kelly.
According to the Complaint filed today in Manhattan federal court[1]:
From in or about June 2015, up to and including in or about July 2015, computers associated with two particular internet protocol addresses (the “IP Addresses”) made nearly four hundred thousand attempts to gain unauthorized access to the Organization’s computer network. As a result, numerous Organization employees experienced difficulty accessing their Organization email accounts, and were disrupted in their ability to conduct regular business functions. Both of the IP Addresses were subscribed to SEDLAK at SEDLAK’s residence in Florida (the “Sedlak Residence”)
In particular, between June 22, 2015 and July 8, 2015, from one of the IP Addresses, there were approximately 195,000 attempts to log into approximately twenty email accounts of the Organization. Between July 8, 2015 and July 10, 2015, from the other IP Address, there were an additional approximately 195,000 attempts to log into approximately six email accounts of the Organization. SEDLAK has never been employed by the Organization, and was not authorized to access any email accounts of the Organization.
On or about September 11, 2015, USSS agents executed a search warrant at the Sedlak Residence, from which they seized, among other things, (i) approximately 30 computers connected to the same internal network, which enabled each computer to communicate with the others (the “Sedlak Computers”); (ii) notes pertaining to the Organization, an executive of the Organization (“Individual-1”) and an individual who has been publicly affiliated with the Organization (“Individual-2”), including e-mail addresses, registrant information for certain website domain names, and certain IP address information associated with the Organization, Individual-1 and/or Individual-2; and (iii) lists of e-mail addresses and e-mail servers, many of which included the word “jihad.” The Sedlak Computers contained, among other things, a list of certain Organization employees’ email account usernames, and a “brute force” password-cracking tool. Such a tool is designed to launch a relentless barrage of potential passwords at an email account in an attempt to guess the account’s password.
On or about September 11, 2015, USSS agents interviewed SEDLAK, who claimed to be using the Sedlak Computers to conduct “research” into charitable organizations in the course of his work as a private investigator. In particular, SEDLAK claimed to be trying to determine if such organizations are unintentionally financing jihadist groups by sending, to charitable organizations in the Middle East, funds which are then seized by jihadist groups. When asked about notes pertaining to Individual-1 and Individual-2 found at the Sedlak Residence, SEDLAK claimed that he came across such information in his “research” into the financing of jihadist groups. SEDLAK claimed that he hoped to sell the information he found.
* * *
SEDLAK, 42, of Ocoee, Florida, is charged with one count of attempted unauthorized access to a computer, which carries a maximum sentence of five years. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Bharara praised the outstanding investigative work of the U.S. Secret Service. Mr. Bharara also noted that the investigation remains ongoing.
The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorney Kristy J. Greenberg is in charge of the prosecution.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein, constitute only allegations, and every fact described should be treated as an allegation.
Manager of IBEW Credit Union in Paducah, Guilty of Embezzling More Than $600,000Read the Press Release
Stolen money used to benefit herself and her friends and family
PADUCAH, Ky. – Debra C. Pyfrom, the former manager of the International Brotherhood of Electrical Workers (IBEW) Local 816 Federal Credit Union, pleaded guilty today in U.S. District Court, before Senior Judge Thomas B. Russell to a single charge of bank fraud, and she agreed to pay restitution in the amount of $600,520.16, announced U.S. Attorney John E. Kuhn, Jr.
“Bank fraud is a serious crime with a cost to all of us,” stated U.S. Attorney John Kuhn. “This defendant was entrusted with the hard-earned money and savings of IBEW credit union members, but she stole that money to spend on herself, her family and friends. This institution was insured, but the cost of the loss will be passed along to the rest of us. For that reason, my Office vigorously investigates and prosecutes fraud against financial institutions.”
Debra C. Pyfrom pleaded guilty to executing a scheme for an unknown period of time, up until she was arrested and terminated by her employer in July 2014. During that time, Pyfrom admitted to embezzling and stealing money from IBEW and its members for an approximate total loss exceeding $600,000. Pyfrom admitted to using the money for her personal benefit and for the benefit of her daughter, her boyfriend, friends, and family.
Pyfrom admitted to embezzling and stealing money through manipulation of the credit union accounts, false loan payments, misappropriation of cash, and from loans taken out in members names without their knowledge.
Pyfrom admitted to stealing money from IBEW credit union members’ accounts to cover her personal bills and those of her daughter, boyfriend and others, who had personal deposit accounts at the credit union. Pyfrom would cover these withdrawals with false, computer entry only deposits.
Further Pyfrom admitted to issuing loans to herself and to her daughter and posting false payments to conceal the fraud and make payments appear current on IBEW’s books.
Lastly, Pyfrom further admitted to taking out loans in the names of other IBEW account holders without their knowledge and using that loan money for her own benefit. Again, the balances on these loans were never repaid; rather the defendant would manipulate the entries in the IBEW books in order to falsely show that the loan payments were current.
If convicted of the charge at trial, Pyform could have been sentenced to 30 years in prison, a five year term of supervised release and fined a maximum of $1,000,000.
This case is being prosecuted by Assistant United States Attorney Nute A. Bonner and is being investigated by the McCracken County Sheriff’s Office and the Federal Bureau of Investigation.
Lawsuit Settled Against Heathcare Commons Inc. to Enforce Employment Rights of National Guard SergeantRead the Press Release
CAMDEN, N.J. – A settlement was reached today with Healthcare Commons Inc., resolving claims that the South Jersey company failed to re-employ a Delaware woman when she returned from her deployment with the National Guard, New Jersey U.S. Attorney Paul J. Fishman and Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division, announced.
The civil lawsuit, filed in Camden federal court, alleged that Healthcare Commons, of Carneys Point, New Jersey, willfully violated the Uniformed Services Employment and Re-employment Rights Act of 1994 (USERRA), which protects the rights of uniformed service members to retain their civilian employment following absences due to military service obligations, and provides that service members shall not be discriminated against because of their military obligations.
“Cases like this one not only provide financial relief to soldiers returning from overseas but also ensure that employers fully understand their employment obligations to servicemembers,” Acting Associate Attorney General Stuart F. Delery said. “Through the Servicemembers and Veterans Initiative, the Department of Justice will continue using every tool at our disposal to protect the men and women who serve in our Armed Forces from unjust actions and illegal burdens.”
“The men and women who wear our nation’s uniform need to know that they will be protected from the types of injustice experienced by Ms. Tolliver,” Principal Deputy Assistant Attorney General Vanita Gupta of the Civil Rights Division said. “The Department of Justice, through its enforcement of USERRA, strongly supports the right of service members to retain their rightful positions in the workforce both while they serve and after they complete their military service to our country.”
According to the complaint:
Megan Toliver, 32, of New Castle, Delaware, is a former employee of Healthcare Commons. She joined the U.S. Army National Guard in September 2004 and, most recently, had served as a sergeant, with honorable service as a mental health specialist. When Toliver returned from her military deployment in May 2014, she notified Healthcare Commons that she was seeking re-employment. Healthcare Commons willfully violated USERRA by not re-employing her as a mental health screener or in another comparable position.
Under the terms of a consent decree, which was filed today in federal court, Healthcare Commons agreed to pay $18,500 as back pay and liquidated damages to Toliver. HCI also agreed to adopt a new personnel policy that informs employees of their rights and obligations under USERRA and to provide USERRA training to all supervisory staff.
The case was referred by U.S. Department of Labor following an investigation by the department’s Veterans’ Employment and Training Service.
The plaintiff is represented by Assistant U.S. Attorney Michael E. Campion, U.S. Attorney’s Office, District of New Jersey, and Special Litigation Counsel Andrew Braniff, U.S. Department of Justice, Civil Rights Division, Employment Law Section.
In March 2015, the Attorney General created of the Service Members and Veterans Initiative, which is led by three dedicated career Justice Department attorneys with strong ties to the military community. They will further the Department’s existing efforts by coordinating and expanding enforcement, outreach, and training efforts on behalf of service members, veterans, and their families. The initiative will address the unique challenges that service members face while on active duty, that veterans face upon returning home, and that families face when a loved one is deployed.
Additional information about USERRA can be found on the U.S. Attorney’s Office website at www.justice.gov/usao-nj and the Justice Department’s websites at www.usdoj.gov/crt/emp and www.servicemembers.gov, as well as on the Labor Department’s website at www.dol.gov/vets/programs/userra/main.htm.
Lawsuit Settled Against Healthcare Commons to Enforce Employment Rights of National Guard SergeantRead the Press Release
The Department of Justice has reached a settlement today with Healthcare Commons Inc., resolving claims that the South Jersey company failed to re-employ a Delaware woman when she returned from her deployment with the National Guard, announced Principal Deputy Assistant Attorney General Vanita Gupta, head of the Department of Justice’s Civil Rights Division, and U.S. Attorney Paul J. Fishman of the District of New Jersey.
The civil lawsuit, filed in Camden federal court, alleged that Healthcare Commons, of Carneys Point, New Jersey, willfully violated the Uniformed Services Employment and Re-employment Rights Act of 1994 (USERRA), which protects the rights of uniformed service members to retain their civilian employment following absences due to military service obligations, and provides that service members shall not be discriminated against because of their military obligations.
“Cases like this one not only provide financial relief to soldiers returning from overseas but also ensure that employers fully understand their employment obligations to servicemembers,” said Acting Associate Attorney General Stuart F. Delery. “Through the Servicemembers and Veterans Initiative, the Department of Justice will continue using every tool at our disposal to protect the men and women who serve in our Armed Forces from unjust actions and illegal burdens.”
“The men and women who wear our nation’s uniform need to know that they will be protected from the types of injustice experienced by Ms. Tolliver,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division. “The Department of Justice, through its enforcement of USERRA, strongly supports the right of service members to retain their rightful positions in the workforce both while they serve and after they complete their military service to our country.”
According to the complaint, Megan Toliver, 32, of New Castle, Delaware, is a former employee of Healthcare Commons. She joined the U.S. Army National Guard in September 2004 and, most recently, had served as a sergeant, with honorable service as a mental health specialist. When Toliver returned from her military deployment in May 2014, she notified Healthcare Commons that she was seeking re-employment. Healthcare Commons willfully violated USERRA by not re-employing her as a mental health screener or in another comparable position.
Under the terms of a consent decree, which was filed today in federal court, Healthcare Commons agreed to pay $18,500 as back pay and liquidated damages to Toliver. Healthcare Commons also agreed to adopt a new personnel policy that informs employees of their rights and obligations under USERRA and to provide USERRA training to all supervisory staff.
The case was referred by the U.S. Department of Labor following an investigation by the department’s Veterans’ Employment and Training Service.
The plaintiff is represented by Special Litigation Counsel Andrew Braniff of the Department of Justice’s Civil Rights Division and Assistant U.S. Attorney Michael E. Campion of the District of New Jersey.
In March 2015, the Attorney General created the Servicemembers and Veterans Initiative, which is led by three dedicated career Justice Department attorneys with strong ties to the military community. They will further the department’s existing efforts by coordinating and expanding enforcement, outreach and training efforts on behalf of service members, veterans and their families. The initiative will address the unique challenges that service members face while on active duty, that veterans face upon returning home, and that families face when a loved one is deployed.
Additional information about USERRA can be found on the Justice Department’s websites at www.usdoj.gov/crt/emp and www.servicemembers.gov, as well as the U.S. Attorney’s Office website at www.justice.gov/usao-nj and on the Labor Department’s website at www.dol.gov/vets/programs/userra/main.htm.
Lamesa, Texas, Insurance Agent Sentenced to 15 Months in Federal Prison for Making False Statements to USDA Federal Crop Insurance Corp.Read the Press Release
LUBBOCK, Texas — A Lamesa, Texas, man, Joel Thomas Napper, who did business as Agwest Insurance Agency, was sentenced on Friday by U.S. District Judge Sam R. Cummings to serve 15 months in federal prison, fined $4,000, and ordered to pay $124,246 in restitution to the U.S. Department of Agriculture (USDA) Federal Crop Insurance Corporation (FCIC). The announcement was made today by U.S. Attorney John Parker of the Northern District of Texas.
Napper pleaded guilty in June 2015 to one count of making false statements to the USDA’s FCIC and Aiding and Abetting. He must surrender to the Bureau of Prisons on October 16, 2015.
According to documents filed in the case, Napper admitted that from approximately July 23, 2013, to August 26, 2013, he submitted false Acreage Reports (AR) on behalf of his policy holder clients, falsely representing that policy holders had timely signed the ARs enabling them to qualify for the FCIC program and receive federal crop insurance coverage, when, as Napper well know, the ARs were not timely signed and Napper forged them on behalf of his policyholder clients.
The investigation began in May 2014 after the USDA received information that Napper had made false statements by backdating ARs in order to provide multi-peril crop insurance coverage for his policyholders who were making claims on their 2013 cotton insurance policies. Napper admitted that he had forged signatures and backdated ARs for at least 10 policyholders. By transmitting the false statements, Napper caused a $124,246.00 sales commission paid to Agwest Insurance Agency.
The investigation was conducted by the USDA, Office of Inspector General and prosecuted by Assistant U.S. Attorney Paulina Jacobo.
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Kennebec County Men Plead Guilty to Pharmacy Robbery ChargesRead the Press Release
Contact: F. Todd Lowell
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Steven C. Chaput, 39, of Mount Vernon, Maine pleaded guilty today in U.S. District Court to pharmacy robberies charges. Rudger S. Ellis, 22, of Gardiner, Maine pleaded guilty to the same charges on August 12, 2015.
On February 7, 2015, Ellis entered the Rite Aid Pharmacy located on North Belfast Avenue in Augusta, Maine, wearing a hooded gray sweatshirt, blue and white athletic pants, and gloves and covering his face with a plaid cloth. Ellis approached the counter and demanded that the pharmacist give him oxycodone, oxycontin, and Ritalin. He told the pharmacy employees to hurry up. Ellis absconded with six bottles containing oxycodone.
On February 18, 2015, Ellis robbed the Rite Aid Pharmacy located on Spring Street in Gardiner, again wearing a hooded sweatshirt and gloves and covering his face with a plaid cloth. He approached the pharmacy counter and demanded oxycodone 30 milligram pills. He repeatedly told pharmacy employees to “hurry” and several times commanded: “now, now, now!” Ellis absconded with 11 bottles of oxycodone.
Chaput and Ellis had planned the pharmacy robberies together. Chaput was the getaway driver for both robberies, parking near each pharmacy and waiting as Ellis robbed them.
The defendants face up to 20 years in prison, a $250,000 fine and restitution. They will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
The investigation was conducted by the Augusta and Gardiner Police Departments and the Federal Bureau of Investigation.
KCMO Man Sentenced for Internet Child PornRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Kansas City, Mo., man was sentenced in federal court today for distributing child pornography over the Internet.
Christopher Michael Donovan, 39, of Kansas City, was sentenced by U.S. District Judge Beth Phillips to six years in federal prison without parole.
On Oct. 15, 2014, Donovan pleaded guilty to distributing child pornography over the Internet.
On April 19, 2012, Donovan contacted an undercover FBI task force officer in an Internet chat room and sent images and movies of child pornography to the officer. Two of the images involved toddlers and one of the videos involved a drugged boy of approximately six years of age being molested.
Kansas City, Mo., law enforcement officers searched Donovan’s apartment and recovered a USB storage device that contained 40 movies of child pornography and 13 images of child pornography. These included videos of toddlers and other prepubescent boys. When interviewed by law enforcement officers, Donovan admitted to viewing and sharing child pornography over the Internet for several years. Donovan explained to officers that he downloaded child pornography from his computer onto the thumb drive; he no longer had his computer because it had been confiscated by drug dealers.
Donovan will be subject to federal and state sex offender registration requirements, which may apply throughout his life. Donovan must keep his registration current and notify the state sex offender registration agency of any changes to his name, place of residence, employment or student status, or other relevant information.
This case was prosecuted by Assistant U.S. Attorney David Luna. It was investigated by the Kansas City, Mo., Police Department and the FBI.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Jackson County Resident Sentenced on Methamphetamine OffenseRead the Press Release
On September 11, 2015, Amye L. Sandidge, 29, of Murphysboro, IL, was sentenced for her involvement in a methamphetamine conspiracy, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
Sandidge, who had previously pled guilty to the one-count indictment charging conspiracy to manufacture methamphetamine, was sentenced to 84 months in federal prison, 3 years’ supervised release and fined $200. The offense occurred between 2010 and May 2014, in Jackson, Williamson, Union, and Franklin Counties. Evidence at the plea and sentencing hearings established that Sandidge was involved with others in the manufacture of methamphetamine. Sandidge purchased pseudoephedrine for her use in the manufacture of methamphetamine and also obtained pseudoephedrine from others. During the execution of a June 6, 2014, search warrant at Sandidge’s Murphysboro residence, agents located a methamphetamine lab. Sandidge was present at the residence along with a 17 year-old juvenile. In addition to the 17 year-old, evidence also established that a 15 year-old juvenile was involved with Sandidge in the manufacture and distribution of methamphetamine. At the sentencing hearing, the district court found that Sandidge was responsible for the illegal possession of 211 grams of pseudoephedrine. Sandidge also received a sentencing enhancement based on her use of juveniles in the offense. Eleven co-defendants have previously been sentenced for their involvement in the methamphetamine conspiracy. Two co-defendants have pled guilty and are awaiting sentencing.
The ongoing investigation is being conducted by the Jackson County Sheriff’s Office, Murphysboro Police Department, Carbondale Police Department, Illinois State Police/Southern Illinois Drug Task Force, and Drug Enforcement Administration.
The case is assigned to Assistant United States Attorney Amanda A. Robertson for prosecution.
Hunting Show Host, Two Production Companies, Nine Others Charged in Noatak National Preserve Poaching InvestigationRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that a cable TV hunting show host and nine other individuals were charged in Fairbanks U.S. District Court and other states for their participation in a multi-year poaching operation on the Noatak National Preserve. According to the charging documents, dozens of big game animals, including grizzly bear, moose, caribou and Dall sheep were illegally hunted and killed with some of the illegal kills ending up on a cable television show. Two production companies and another individual charged with filming and airing footage without a permit have also been cited by the National Park Service in connection with this investigation.
Charged in separate cases are Clark W. Dixon, 41, of Hazelhurst, Mississippi; Charles W. Dixon, 70, of Brookhaven; Mississippi, Randolph Goza, 48, of Wasilla, Alaska; Terry Goza, 71, of Hazelhurst, Mississipi; Clarence Michael Osborne, 53, of Madison, Mississippi; Shannon Dale Hooks, 54, of Mendenhall, Mississippi; Lance David Walker, 37, of Baton Rouge, Louisiana; Fulton Josef Wold, 41, of Nashville, Tennessee, and Robert Scott Viner, 40, of Ridgeland, Mississippi.
According to the charging documents, Clark W. Dixon, a featured host on the cable TV hunting show “The Syndicate,” was charged with two felony violations of the federal Lacey Act for his role in the illegal take of big game. The first charge against Clark W. Dixon alleges that in 2010 Dixon and Clarence Michael (“Mike”) Osborne, who is charged separately, illegally took a grizzly bear, for a fee, same-day airborne, and without Clark Dixon being a licensed and registered Alaska big game guide. In the second charge, Clark W. Dixon is charged with conducting an illegal outfitting operation on the Noatak National Preserve from 2009 to the present. Assisting Clark Dixon in the operation, as alleged, were Randolph Goza and Charles W. Dixon, both of whom are pilots.
The investigation as charged alleges that, at the time the violations were committed, Clark W. Dixon falsely claimed Alaska residency status while being a resident of the state of Mississippi. The charges against Dixon reflect that he lied about his residency status in order to take advantage of Alaska resident hunting privileges.
Charles W. Dixon, who is Clark W. Dixon’s father, is charged with two counts of violating the Lacey Act and one count of criminal forfeiture which seeks forfeiture of a STOLQuest SQ-4 aircraft. As a basis for forfeiture of the aircraft it is alleged that Charles W. Dixon used the aircraft in the illegal outfitting, guiding and transporting operation, in addition to using the aircraft to transport unlawfully taken game taken by Clark W. Dixon and others.
Randall (“Randy”) Goza, Terry Goza, Michael Osborne, Shannon Hooks, Lance Walker, and Fulton Wold are separately charged with the illegal take of various Alaska big game species, with all, except Mr. Hooks, hunting out of Clark Dixon’s illegal hunting camp within the Noatak National Preserve. Unlawfully taken species of game as alleged include grizzly bear, moose, caribou and Dall sheep, with all of those species charged as being taken through illegal hunting methods such as same-day airborne (Randy Goza, Terry Goza, Osborne) unpermitted and untagged takes, (Hooks, Wold, Walker, Osborne) and taking grizzly bear without a guide or tag, while permitting Clark Dixon or Charles Dixon to unlawfully claim the bear kills as their own (Osborne, Hooks, Walker). Robert Viner has been cited in Mississippi, through this investigation, for the illegal transport of an unlawfully taken brown bear. Mr. Viner has admitted guilt in connection with the charges, and has paid a $3250 fine.
It is further alleged that Clark Dixon used and broadcasted video footage from these illegal hunts on the Noatak National Preserve for use on the hunting show, “The Syndicate,” without obtaining a permit from the Noatak Preserve for conducting a commercial operation. Citations from the National Park Service for conducting filming operations on the Noatak Preserve without a permit have been issued to The Outdoor Syndicate, LLC, Reno, Nevada, its owner, Michael P. Dianda, and an editing studio, Zap Lab, Ltd, Reno, Nevada. The citations were issued because Clark W. Dixon and another professional videographer acquired footage for, and used the footage on The Syndicate, without obtaining a permit to commercially film on the Preserve.
All individuals in the Syndicate investigation charged today have been charged in separate cases. The following is an identification key referencing the uncharged individuals referred to in each case.
Clark Dixon case – Individuals: A: Clarence Osborne, B: Charles Dixon, C: Randolph Goza
Charles Dixon case – Individuals A: Clarence Osborne, B: Clark Dixon C: Randolph Goza
Randy Goza case—Individuals A: Clark Dixon, B: Clarence Osborne, C: Charles Dixon,
D: Terry Goza
Terry Goza case – Individuals A: Randolph Goza, B: Clark Dixon
Michael Osborne case – Individuals A: Clark Dixon, B: Randolph Goza, C: Charles Dixon
Shannon Hooks case – Individuals A: Clark Dixon, Uncharged B: Charles Dixon
Lance Walker case – Individuals A: Clark Dixon, B: Charles Dixon
Fulton Wold case – Individual A: Clark Dixon
Arraignment dates have not been set. The multi-state investigation continues.
Ms. Loeffler commends the work of the U.S. Fish and Wildlife Service, Division of Law Enforcement, and the National Park Service who jointly investigated this case in Alaska and elsewhere.
Harrold Man Sentenced for Attempted Murder of a Federal EmployeeRead the Press Release
Acting United States Attorney Randolph J. Seiler announced that a Harrold, South Dakota, man convicted of Attempted Murder of a Federal Employee was sentenced on September 14, 2015, by U.S. District Judge Roberto A. Lange.
Brian Iron Boulder, a/k/a Brian Ironboulder, age 51, was sentenced to 216 months in custody, followed by 3 years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Iron Boulder was indicted by a federal grand jury on April 8, 2015. He pled guilty on June 23, 2015.
“The attempted murder of this federal employee in his own workplace was a disturbing crime, and the 18-year sentence handed down today demonstrates that justice was served,” said Seiler. “Everyone has a right to feel safe in their work environment, and when that is jeopardized by an act of violence, the consequences of the crime must send a strong message. That was accomplished in this case.”
The conviction stems from an incident on March 25, 2015, when Iron Boulder went to the Bureau of Indian Affairs (BIA) building in Fort Thompson to speak with Patrick Duffy, Superintendent of the Crow Creek Agency. Iron Boulder normally does not carry weapons with him, however on this day, he intentionally brought with him a pocket knife, with a four-inch blade. Iron Boulder purposely had the blade extended on the knife when he entered the building to speak with Superintendent Duffy, who was in a meeting, but agreed to speak with Iron Boulder. The two began to walk down the hallway, with Duffy in front, and Iron Boulder a few steps behind him. At this time, Iron Boulder took the knife out of his pocket, intentionally stabbed Duffy in the center of the back with the knife, and then fled the building. Iron Boulder admitted that he knowingly and intentionally stabbed Duffy in the back because of his role as the Superintendent of the Crow Creek agency.
Co-workers summoned law enforcement and an ambulance. Duffy was taken by ambulance, with the knife protruding from his back, to Mid-Dakota Hospital in Chamberlain. The stab wound penetrated the chest wall, with blood in the plural cavity, which required a chest tube after the knife was removed. Due to the extent of his injuries, Duffy was airlifted to Sanford Hospital in Sioux Falls and hospitalized until March 31, 2015. He continued to receive follow-up care and on April 14, 2015, Duffy was again taken to Sanford Hospital in Sioux Falls. He had a collapsed lung and required a second surgery. As a result of the attempted murder, Duffy received life-threatening injuries. He has since returned to work.
This case was investigated by the BIA, Crow Creek Agency. Assistant U.S. Attorney Meghan N. Dilges prosecuted the case.
Iron Boulder was immediately turned over to the custody of the U.S. Marshals Service.
Grape Street Crips Member Admits Conspiring to Sell HeroinRead the Press Release
NEWARK, N.J. – A member of the Grape Street Crips street gang today admitted conspiring to distribute heroin in and around Newark, U.S. Attorney Paul J. Fishman announced.
Sharod Brown, 30, of Newark, pleaded guilty today before U.S. District Judge Esther Salas in Newark federal court an information charging him with one count of conspiring to distribute heroin.
According to documents filed in this case and statements made in court:
In May 2015, 50 alleged members and associates of the Grape Street Crips were charged over a three-week period in criminal complaints that alleged drug-trafficking, physical assaults, and witness intimidation. In addition to controlling drug-trafficking across large swaths of Newark, the Grape Street Crips allegedly engaged in acts of violence — including murder, shootings, aggravated assaults, and witness intimidation. Over the course of the entire investigation, 71 defendants have been charged with federal and state charges.
Brown admitted that, between November 2014 and May 2015, he conspired with others to distribute 10 bricks of heroin in and around the Pennington Court public-housing complex, located on Pennington Street in Newark, New Jersey.
The count of conspiring to distribute heroin to which Brown pleaded guilty is punishable by a maximum potential penalty of 20 years in prison. Sentencing is scheduled for Dec. 21, 2015.
U.S. Attorney Fishman credited special agents of the DEA, under the direction of Special Agent in Charge Carl J. Kotowski; and special agents of the FBI, under the direction of Special Agent in Charge Richard M. Frankel, for the investigation leading to today’s guilty plea. He also thanked prosecutors and detectives of the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Carolyn A. Murray; police officers and detectives of the Newark Police Department, under the direction of Director Eugene Venable and Chief Anthony Campos; and the Essex County Sheriff’s Office under the direction of Armando B. Fontoura, for their work on the investigation.
The government is represented by Assistant U.S. Attorneys Osmar J. Benvenuto, Elizabeth M. Harris, and Barry Kamar of the Criminal Division in Newark.
This case was conducted under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF) and the FBI’s Safe Streets Task Force, a partnership between federal, state and local law enforcement agencies. 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.
The charges and allegations contained in the federal criminal complaints and indictment against the remaining defendants are merely accusations, and they are presumed innocent unless and until proven guilty.
Defense counsel: Jason F. Orlando Esq., Jersey City, New Jersey
Franklin County Resident Pleads Guilty to Methamphetamine OffenseRead the Press Release
On September 11, 2015, Russell A. Stokes, 24, of Benton, pled guilty to one-count of conspiracy to manufacture methamphetamine, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
Evidence at the plea hearing established that between 2013 and January 2015, Stokes was involved with co-defendants Michael Boyt, Jr., Jonathan Haslett, and others in the manufacture of methamphetamine. Stokes provided pseudoephedrine to multiple other persons to use to manufacture methamphetamine. The offense occurred in Perry, Randolph, Williamson, Jackson, and Franklin Counties. Stokes is currently being held without bond pending a December 29, 2015, sentencing hearing. The methamphetamine offense carries a maximum penalty of up to 20 years’ imprisonment, to be followed by 3 years’ supervised release, and a $1,000,000 fine.
The ongoing investigation is being conducted by the Randolph County Sheriff’s Office, Jackson County Sheriff’s Office, Steeleville Police Department, Coulterville Police Department, Sparta Police Department, Perry County Drug Task Force, and Illinois State Police Methamphetamine Response Team. The Randolph County State’s Attorney’s Office also assisted in the investigation.
The case is assigned to Assistant United States Attorney Amanda A. Robertson for prosecution.
Former Somerville and Cambridge Teacher Sentenced for Child PornographyRead the Press Release
BOSTON – Josh Wairi, 28, of Somerville, was sentenced today by U.S. District Court Judge William G. Young to 12 years in prison and eight years of supervised release. In May 2015, Wairi was convicted following a jury trial of transportation of child pornography and possession of child pornography. When released from prison, Wairi will be required to register as a sex offender.
Wairi, a former fifth and sixth grade teacher in the Somerville and the Cambridge Public Schools, used his email account to trade and receive images and videos of child pornography, and also uploaded images and videos of children being sexually exploited. Wairi possessed more than 27,000 images and over 530 videos of children engaged in sexually explicit conduct. Wairi admitted to viewing the images for sexual self-gratification.
United States Attorney Carmen M. Ortiz; Shelly Binkowski, Inspector in Charge of the U.S. Postal Inspection Service; Colonel Richard D. McKeon, Superintendent of the Massachusetts State Police; Somerville Police Chief David Fallon; and Cambridge Police Commissioner Robert Haas, made the announcement today. The case was prosecuted by Assistant U.S. Attorneys Suzanne Sullivan Jacobus and Seth B. Orkand of Ortiz’s Major Crimes Unit.
The case is brought as part of Project Safe Childhood. In 2006, the Department of Justice created Project Safe Childhood, a nationwide initiative designed to protect children from exploitation and abuse. Led by the U.S. Attorneys’ Offices and the DOJ’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov/.
Members of the public who have questions, concerns, or information regarding this case should call (617) 748-3274.
Former Marshall University football running back pleads guilty to cyberstalkingRead the Press Release
HUNTINGTON, W.Va. – A 23-year old former Marshall University running back from Hollywood, Florida pleaded guilty today in federal court in Huntington to cyberstalking, announced United States Attorney Booth Goodwin. Kevin LaShawn Grooms, Jr. entered a guilty plea before Chief United States District Court Judge Robert C. Chambers.
Grooms admitted to using a cell phone beginning on March 24, 2015, and continuing to the early hours of the next day to send threatening messages to his ex-girlfriend. Grooms sent the threatening messages via Instagram and text. Grooms’ conduct placed his ex-girlfriend in reasonable fear of death or serious bodily injury, and caused her to suffer substantial emotional distress. An investigation conducted by the Federal of Bureau of Investigation, revealed that Grooms sent 158 messages to his ex-girlfriend within 8 hours of being released from the Western Regional Jail on March 24, 2015. Grooms was under a Domestic Violence Protection Order at the time he sent the threatening messages. The messages sent by Grooms consisted of photographs and attached messages that mocked the strength of domestic restraining orders, threatened his ex-girlfriend, and claiming his no-fear readiness to die.
Grooms met his ex-girlfriend in September of 2012, when they were both enrolled at Marshall University. Grooms admitted to engaging in a pattern of activity including stalking, threatening the use of a deadly weapon, harassing and assaulting his ex-girlfriend throughout their relationship.
The court scheduled a sentencing hearing for Grooms on December 14, 2015. He faces a prison sentence of two years, followed by three years of supervised release, and a maximum fine of $250,000.
U.S. Attorney Booth Goodwin stated, “We are committed to working closely with our law enforcement partners to identify and prosecute those who use modern technology to stalk, threaten, and harass. Technology is wonderful but we will not allow it to be used as a dangerous weapon.”
The Federal Bureau of Investigation and the Huntington Police Department conducted the investigation. Assistant United States Attorney Lisa Johnston handled the prosecution.
Former Humana Inc. Employees Sentenced for Taking Kickbacks Totaling $2 Million Dollars in an Insurance Sales Bribery SchemeRead the Press Release
Judge orders forfeiture and restitution totaling $1 million each
Both defendants sentenced to serve one year in prison
LOUISVILLE, Ky. – Former Humana Inc. regional sales director, Glen Allan Fine and former Humana Inc. sales manager, James E. Wenger, were sentenced September 10, 2015, by Senior Judge Charles R. Simpson III, in United States District Court, to one year and one day in prison, and ordered to pay $100,000 each in restitution and forfeit $900,000 each, for their roles in a racketeering and bribery scheme, connected with their former position, announced United States Attorney John E. Kuhn, Jr.
“Fine and Wenger unlawfully diverted millions of dollars in a kickback scheme that took advantage of their positions of trust and authority at Humana,” stated U.S. Attorney John Kuhn. “We simply cannot allow the integrity and efficiency of the health insurance market to be compromised by underhanded, back-door deals. The prison sentence and restitution order is a just outcome.”
“As this sentencing shows, it is increasingly important for all of us to remain vigilant against corporate fraud. As corporate insiders, Wenger and Fine abused their positions to obtain approximately $2,000,000 each in unlawful kickbacks. The FBI, and its law enforcement partners, will continue to work together to hold those who abuse their positions of trust accountable,” stated Howard Marshall, Special Agent in Charge, FBI Louisville.
“These individuals used their positions at a Medicare contractor to demand kickbacks from insurance agents who wanted to market Medicare plans,” said Derrick L. Jackson, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General in Atlanta. “This type of crime harms the integrity of the program and will not be tolerated.”
“The U.S. Postal Inspection Service will continue to strongly pursue its mission of investigating Mail Fraud crimes and protecting the US Postal Service and its customers,” stated Inspector in Charge, Dugan Wong, Pittsburg Division, U.S. Postal Inspection Service.
Co-defendants Fine, age 56, and Wenger, age 50, both of Louisville, previously pleaded guilty, in 2013, to a single count federal information charging them with taking kickbacks totaling over four million dollars while employed as part of Humana’s sales and marketing division known as the MarketPoint Organization.
According to their plea agreements, Fine admitted that in 2005, he, along with Wenger and others, met at a hotel in Florida to discuss sending insurance agents to Shep Cutler, one of the larger Managing General Agencies (MGA) and Dan McNerney, one of his business partners, and also a MGA. Fine and co-defendant Wenger, agreed to send insurance agents, who wanted to sell Humana Medicare Advantage and Prescription Drug Plan products, to Cutler and McNerney in exchange for Cutler sending payments to Fine and Wenger. The four agreed to split the override fees, and each would receive payments of 25%. Fine and Wenger agreed to set up fictitious business accounts in their wives' names. Fine and Wenger admitted to sending agents to Cutler and McNerney's MGAs, and acknowledged their wives did not provide any service in exchange for the money received from Cutler. Fine and Wenger were not authorized by Humana to enter into a kickback relationship with Cutler and McNerney. Both Fine and Wenger received approximately $2,000,000 each for their participation in the scheme. As a result of this kickback arrangement, Humana suffered a loss to its business, and had to pay legal and other investigative costs.
This case was prosecuted by Assistant United States Attorney Lettricea Jefferson-Webb and was investigated by the Federal Bureau of Investigation (FBI), the Department of Health and Human Services, Office of Inspector General, and the United States Postal Inspection Service, with assistance from Humana Inc.
Former FBI Special Agent Sentenced to Five Years in Bribery SchemeRead the Press Release
A former FBI special agent was sentenced today to serve five years in prison, to be served consecutively with a 10 year federal sentence imposed on him previously in the District of Utah, for accepting and soliciting bribes in exchange for providing internal law enforcement documents and other confidential information about a prominent citizen of Bangladesh for use by a political rival.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Preet Bharara of the Southern District of New York and Inspector General Michael E. Horowitz of the Department of Justice made the announcement.
Robert Lustyik, 53, of Westchester County, New York, pleaded guilty on Dec. 23, 2014, to all five counts in the indictment against him, including conspiracy to engage in a bribery scheme, soliciting bribes by a public official, conspiracy to defraud the citizens of the United States and the FBI, theft of government property and unauthorized disclosure of a Suspicious Activity Report. Lustyik separately was sentenced on March 30, 2015, in the District of Utah to 10 years imprisonment for soliciting and accepting bribes in exchange for taking official actions in his capacity as an FBI special agent.
Lustyik was an FBI special agent who worked on the counterintelligence squad in the White Plains Resident Agency. Johannes Thaler was Lustyik’s friend and Rizve Ahmed, aka Caesar, was an acquaintance of Thaler. According to court records, from September 2011 through March 2012, Lustyik, Thaler and Ahmed engaged in a scheme in which Lustyik and Thaler solicited bribe payments from Ahmed in exchange for Lustyik’s agreement to provide confidential documents and information pertaining to a prominent citizen of Bangladesh whom Ahmed perceived to be a political rival, and whom Ahmed sought to locate and harm. Lustyik had access to the confidential documents and information through his position as an FBI special agent.
As part of the scheme, Lustyik and Thaler exchanged text messages, including messages about how to pressure Ahmed to pay them additional money in exchange for confidential information. For example, in late December 2011 and early January 2012, Lustyik texted Thaler, “we need to push [Ahmed] for this meeting and get that 40 gs quick . . . . I will talk us into getting the cash . . . . I will work my magic . . . . We r sooooooo close.” Thaler responded, “I know. It’s all right there in front of us. Pretty soon we’ll be having lunch in our oceanfront restaurant . . . .”
Thaler and Ahmed previously pleaded guilty to bribery and conspiracy to commit fraud and were sentenced on March 5, 2015, to serve 30 months and 42 months in prison, respectively.
The case was investigated by the Department of Justice’s Office of the Inspector General, and prosecuted by Trial Attorney Emily Rae Woods of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Benjamin Allee of the Southern District of New York.
Former FBI Special Agent Robert Lustyik Sentenced in White Plains Federal CourtRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that ROBERT LUSTYIK was sentenced today in White Plains federal court by U.S. District Judge Vincent Briccetti to 5 years in prison, to be served consecutively with a ten year federal sentence imposed on him previously in the District of Utah. LUSTYIK was sentenced for his convictions arising out of a bribery scheme during which he sold confidential law enforcement information in exchange for cash and the promise of additional cash.
U.S. Attorney Preet Bharara said: “Decades of honest, hard work by thousands of FBI Special Agents dedicated to the pursuit of justice have earned the FBI a well-deserved reputation for public service and integrity. Robert Lustyik’s criminal conduct, driven by greed and corruption, displayed a disdain for the integrity for which the FBI stands. Today, he was held accountable for putting his own greedy self-interest above the interests of the public he served.”
According to the Complaint, the Indictment, court hearings, and today’s proceedings:
LUSTYIK was a Special Agent with the Federal Bureau of Investigation (“FBI”) who worked on the counterintelligence squad in the White Plains Resident Agency. Johannes Thaler was LUSTYIK’s friend, and Rizve Ahmed was an acquaintance of Thaler. From in or about September 2011 through March 2012, LUSTYIK, Thaler, and Ahmed engaged in a bribery scheme. As part of the scheme, LUSTYIK and Thaler solicited payments of money from Ahmed, in exchange for LUSTYIK’s agreement to provide internal, confidential documents and other confidential information to which LUSTYIK had access by virtue of his position as an FBI Special Agent. The documents and information pertained to a prominent citizen of Bangladesh (“Individual 1”). Ahmed perceived himself on the opposite side of a political rivalry with Individual 1. Ahmed sought, among other things, to obtain information about Individual 1, to locate Individual 1, and to harm Individual 1 and others associated with Individual 1.
As part of the scheme, LUSTYIK and Thaler exchanged text messages, including messages about how to pressure Ahmed to pay them additional money in exchange for confidential information. For example, in text messages, LUSTYIK told Thaler, “we need to push [Ahmed] for this meeting and get that 40 gs quick . . . . I will talk us into getting the cash . . . . I will work my magic . . . . We r sooooooo close.” Thaler responded, “I know. It’s all right there in front of us. Pretty soon we’ll be having lunch in our oceanfront restaurant . . . .”
For another example, in or about late January 2012, LUSTYIK, upon learning that Ahmed was considering using a different source to obtain confidential information about Individual 1, texted Thaler, “I want to kill C . . . . I hung my ass out the window n we got nothing? . . . . Tell [Ahmed], I’ve got [Individual 1’s] number and I’m pissed. . . . I will put a wire on n get [Ahmed and his associates] to admit they want [a Bangladeshi political figure] offed n we sell it to Individual 1].” LUSTYIK further texted Thaler, “So bottom line. I need ten gs asap. We gotta squeeze C.”
* * *
LUSTYIK, 53, of Westchester County, pled guilty on December 23, 2014, to all five counts in the Indictment in which he is charged. LUSTYIK pled guilty to (1) conspiracy to engage in a bribery scheme; (2) soliciting bribes by a public official; (3) conspiracy to defraud the citizens of the United States and the FBI; (4) theft of government property; and (5) unauthorized disclosure of a Suspicious Activity Report. In addition to his prison term, LUSTYIK is also sentenced to two years supervised release.
Thaler, 51, of New Fairfield, Connecticut, and Ahmed, 35, of Danbury, Connecticut, were each sentenced for bribery and conspiracy to commit fraud, to which each previously pled guilty. Thaler was sentenced by Judge Briccetti to 30 months in prison, and Ahmed to 42 months in prison.
Mr. Bharara praised the efforts of the Department of Justice Office of the Inspector General, which conducted the investigation in this case.
The prosecution is being handled by the Office’s White Plains Division and by the Public Integrity Section of the U.S. Department of Justice. Assistant United States Attorney Benjamin Allee and Trial Attorney Emily Rae Woods are in charge of the prosecution.
Former Assemblyman William Scarborough Sentenced on Fraud and Theft ConvictionsRead the Press Release
ALBANY, NEW YORK – Former New York State Assemblyman William Scarborough, 69, of Queens, New York, was sentenced today to 13 months in prison and 2 years of supervised release after being convicted of wire fraud and theft from a program receiving federal funds, announced United States Attorney Richard S. Hartunian of the Northern District of New York, New York State Attorney General Eric T. Schneiderman, New York State Comptroller Thomas P. DiNapoli, and Special Agent in Charge Andrew W. Vale of the Federal Bureau of Investigation, Albany Division.
Senior United States District Judge Thomas J. McAvoy also ordered that Scarborough pay $54,355 in restitution to New York State and forfeit the same amount to the United States. Scarborough pleaded guilty on May 7, 2015 pursuant to a written plea agreement with the United States that required him to resign his position as a Member of the New York State Assembly.
Scarborough’s federal convictions relate to his wrongful receipt of per diem payments from New York State. Assembly members receive per diem payments when they spend time in, and travel to and from, Albany. Scarborough falsely claimed, and received, per diem payments for days that he was not in Albany or in transit to or from the city.
U.S. Attorney Richard S. Hartunian said: "It is a sad day when an elected official is sentenced to imprisonment, but it is a serious crime when such an official steals the state funds he is sworn to safeguard. Former Assemblyman Scarborough betrayed the people’s trust when he repeatedly lied about when he had been in Albany to line his pockets. We hope that this prosecution helps bring an end to abuses of the state legislature’s per diem system."
As a New York State Assemblyman, Scarborough was entitled to receive the following types of payments when he traveled to Albany for legislative business: an allowance for overnight stays in Albany (full per diem), which varied from $160 to $171 per day; an allowance for travel not requiring an overnight stay in Albany (partial per diem), which varied from $49 to $61 per day; and reimbursement for mileage incurred for travel between his home and Albany. To receive those payments, Scarborough was required to submit travel vouchers to the New York State Assembly Finance Department certifying his dates of travel to and from Albany; the number of miles he traveled to and from Albany; the purpose of his travel; the days he was in Albany; and his eligibility for payment for either full per diem or partial per diem on each of those days. He also had to certify that the claimed amount was "just, true and correct."
From January 2009 through December 2012, Scarborough submitted 174 fraudulent travel vouchers to the assembly’s Finance Department, causing the State of New York to pay him $54,355 that he was not entitled to receive. In the fraudulent vouchers, Scarborough falsely certified that he had been in Albany for legislative business on specific days when he had not been in Albany at all, had been in Albany for less time than he claimed on a voucher, or had not stayed in Albany overnight.
On May 7, 2015, in a related case investigated by the New York State Attorney General’s Office and the New York State Comptroller’s Office, Scarborough pleaded guilty in Albany County Court to grand larceny in the fourth degree concerning his misuse of over $40,000 from his Friends of Bill Scarborough campaign account and is expected to be sentenced today to one year of jail time.
"Today’s sentencing of Assemblymember Scarborough on public corruption charges sends a clear message that those who abuse the public trust will be held accountable," said State Attorney General Eric Schneiderman. "Assemblymember Scarborough’s jail sentence resolves one unfortunate chapter in New York State government, but crystalizes the need for comprehensive reform to clean up corruption in our state."
"Public service is a commitment, not a means for self-enrichment," said State Comptroller Thomas P. DiNapoli. "Mr. Scarborough betrayed his oath of office. This case serves as a reminder: we are on the job, we are working together, and we will hold you accountable. I thank U.S. Attorney Hartunian, the Federal Bureau of Investigation and Attorney General Schneiderman for their hard work on this case."
"Today’s sentencing is the culmination of a vigorous and multi-agency investigation," said Special Agent in Charge Andrew W. Vale. "No public official is exempt from law enforcement scrutiny; if they breach the public’s trust through stealing in the course of their official duties, they will be brought to justice."
The federal case was investigated by the Federal Bureau of Investigation, Albany Division, and was prosecuted by Assistant United States Attorney Jeffrey C. Coffman.
Prosecuting the state case is Assistant Attorney General Christopher Baynes of the Attorney General’s Public Integrity Bureau. The Public Integrity Bureau is led by Bureau Chief Daniel Cort and Deputy Bureau Chief Stacy Aronowitz. The state’s investigation was handled by Investigator Mark Spencer and Deputy Bureau Chief Antoine Karam of the Investigation Bureau. The Investigations Bureau is led by Dominick Zarrella. Forensic Auditor Jason Blair, Legal Analyst Sara Pogorzelski, and Supervising Investigator Edward Keegan provided additional assistance.
The New York State Comptroller’s Division of Investigations conducted the investigation for Comptroller DiNapoli's Office.
Florida man convicted of oxycodone traffickingRead the Press Release
CLARKSBIRG, WEST VIRGINIA – Nathaniel Walker, 33, of Miami, Florida, was convicted of oxycodone trafficking today in federal court, United States Attorney William J. Ihlenfeld, II, announced.
Walker was discovered in possession of oxycodone in Monongalia County, West Virginia. He pled guilty today to a criminal Information charging him with one count of “Possession with Intent to Distribute Oxycodone.” He faces up to 20 years in prison and a fine of up to $1,000,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Zelda Wesley prosecuted the case on behalf of the government. The West Virginia State Police Bureau of Criminal Investigation led the inquiry.
U.S. Magistrate Judge John S. Kaull presided.
Federal Judge Sentences Pittsburgh Drug Dealer to 30 Years in PrisonRead the Press Release
PITTSBURGH - A Pittsburgh drug dealer has been sentenced in federal court to 30 years in prison, followed by 10 years supervised release, on his conviction of violating federal drug laws, United States Attorney David J. Hickton announced today.
United States District Judge Terrence F. McVerry imposed the sentence on Kenyatta Robinson, 35.
According to information presented to the court at a non-jury trial on June 1, 2015, on Nov. 1, 2013, Robinson possessed with intent to distribute more than 280 grams of crack cocaine and less than 500 grams of powder cocaine. As noted by Judge McVerry, Robinson was “on the run from a half-way house” when he was arrested for this offense.
Prior to imposing sentence, Judge McVerry noted Robinson's lengthy criminal history, which includes three prior felony drug convictions, as well as numerous incidents involving firearms and assaults. As a result, Robinson has been properly designated as a Career Offender under the federal sentencing guidelines. While imposing the lengthy sentence, Judge McVerry further stated that Robinson’s extensive and ongoing contact with the criminal justice system reveals that he has no interest in changing his “destructive” behavior.
Assistant United States Attorneys Amy L. Johnston and Troy Rivetti prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Federal Bureau of Investigation, Pittsburgh Bureau of Police, and the Western Pennsylvania Fugitive Task Force for the investigation leading to the successful prosecution of Kenyatta Robinson.
District Court Approves Transition Plan for Clinical and Housing Operations of Substance Abuse Provider Engaged in A Fraudulent Kickback SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and Scott Lampert, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General’s (“HHS-OIG”) New York Region, announced that a transition plan for NARCO FREEDOM, INC. (“NARCO FREEDOM”), a provider of outpatient chemical dependency clinics and short-term housing in residences known as “three-quarter houses,” has been approved in Manhattan Federal Court. In April 2015, NARCO FREEDOM was enjoined from engaging in a fraudulent kickback scheme and a temporary receiver was appointed to take over NARCO FREEDOM’s operations. On September 11, 2015, the Court approved the receiver’s plan to transition the substance abuse clinics and the housing operated by NARCO FREEDOM to other healthcare providers. This transition prevents the imminent disruption of clinical services and housing for NARCO FREEDOM residents. U.S. District Judge John G. Koeltl entered the order last Friday.
Manhattan U.S. Attorney Preet Bharara said: “As the Complaint in this case alleged, Narco Freedom defrauded the government and profited from the exploitation of people most in need of their help. Enjoining Narco Freedom from continuing to engage in the kickback scheme and transitioning its clinics and houses to other providers will provide this vulnerable population with the continuity of care and housing they sorely need.”
HHS-OIG Special Agent in Charge Scott Lampert said: “The conduct displayed by Narco Freedom is a clear example of the damage personal greed does to our nation’s healthcare system. The transition approved by the Court puts an end to Narco Freedom’s illegal practices and allows important substance abuse treatment to continue to be provided without interruption. HHS-OIG recognizes the importance of such treatment, and will continue to ensure that those who provide those services do so in an honest fashion that complies with the law.”
As set forth in the complaint filed on October 28, 2014, in Manhattan federal court:
Since in or about 2006, NARCO FREEDOM was engaged in a scheme to induce individuals who qualified for Medicaid and lacked stable housing to enroll in and attend NARCO FREEDOM’s outpatient clinics in exchange for short-term housing in residences known as “three-quarter houses,” which NARCO FREEDOM referred to as “Freedom Houses.” NARCO FREEDOM allowed individuals without housing, many of whom had been released on parole, to reside in the Freedom Houses for approximately six to nine months, but required all Freedom House residents to enroll in and attend its outpatient clinics, and evicted residents who did not comply. NARCO FREEDOM operated the Freedom Houses specifically in order to drive business to its outpatient clinics, and forced residents of its Freedom Houses who were already enrolled in other outpatient programs to transfer to NARCO FREEDOM’s outpatient programs, in violation of the Patients’ Rights provision of the New York State Code.
On October 29, 2014, U.S. District Judge Koeltl granted the Government’s motion for a restraining order which enjoined NARCO FREEDOM from evicting the residents of its Freedom Houses for refusing to engage in the kickback scheme. On April 2, 2015, Judge Koeltl granted the Government’s motion for a preliminary injunction, concluding that NARCO FREEDOM provided numeration to Medicaid recipients in the form of below-market housing. Judge Koeltl found that by “[p]roviding below-market housing to Medicaid recipients increases costs to the Medicaid program through over-and inappropriate utilization. For those who need housing, the prospect of nearly free housing creates a strong incentive to overuse Narco Freedom’s drug treatment programs.” On April 3, 2015, the Court granted the Government request for an appointment of a temporary receiver to take over and manage the operations of NARCO FREEDOM. On July 28, 2015, New York State Office of Alcohol and Substance Abuse Services issued temporary emergency operating certificates for certain of the three-quarter houses, which were now being operated by the temporary receiver, certifying them as chemical dependence supportive living services.
Friday, Judge Koeltl granted the temporary receiver’s application to transition NARCO FREEDOM’s substance abuse clinics and houses to two other providers who will ensure the continuity of operations, subject to the Court’s order. Specifically the Court ordered Narco Freedom to transition all of its clinics and houses to two different providers, Samaritan Village and Acacia Network, effective on September 22, 2015. Both organizations currently provide housing and substance abuse services in New York City.
* * *
Mr. Bharara thanked the Office of the Inspector General at HHS-OIG for its investigative efforts and support and assistance with the case, as well as the New York State Office of Alcohol and Substance Abuse Services and the New York City Human Resources Administration for their assistance and cooperation.
The case is being handled by the Office’s Civil Frauds Unit. Assistant U.S. Attorneys Kirti Vaidya Reddy and Cristine Irvin Phillips are in charge of the case.
Detroit man sentenced for federal heroin distributionRead the Press Release
Charleston, W.Va. – Dennis Pinckney, 23, of Detroit, Michigan, was sentenced today in federal court in Charleston to seven months in federal prison to be followed by three years of supervised release. Pinckney previously pled guilty in May of 2015 admitting that he had travelled with two other males from Detroit in June of 2014 to a residence in Rand, West Virginia with heroin that they intended to sell. During execution of a search warrant by agents of the Metropolitan Drug Enforcement Network Team (MDENT) at the Rand home, heroin was seized along with money that had been used by law enforcement to make undercover buys of heroin. Pinckney, who was in the house when agents arrived, was arrested. He admitted his involvement in transporting the heroin and serving as a “lookout” during drug deals.
This case is being prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of heroin and prescription drugs. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal heroin and pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers in communities across the Southern District.
Country Music Star Pleads Guilty to Obstructing the IRSRead the Press Release
CINCINNATI – David Allen Coe, 76, of Cincinnati, Ohio, pleaded guilty to one count of impeding and obstructing the due administration of the Internal Revenue laws. Coe faces a maximum of three years in prison and a fine of up to $250,000.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, Kathy A. Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation, Cincinnati Field Office announced the guilty plea entered today before U.S. District Judge Timothy S. Black.
According to court documents, David Allen Coe was a national recording artist in the country music industry. Coe performed at least 100 concerts yearly throughout the United States where he earned income, including during the 2008 through 2013 calendar years. During this same time period, Coe either failed to file his individual income tax returns with the IRS or when Coe did file his individual income tax returns with the IRS, he failed to pay the taxes due and owing. In addition, during this same time period, Coe also owed money to the IRS for prior years of taxes due and owing. Instead of paying his taxes in full, Coe spent the money earned from performing concerts on other debts and gambling.
As part of his entertainer contract, when a concert was booked, Coe required that the total concert fee be deposited upfront. The deposit was either paid by wire or by check made payable to the booking manager's account. The booking manager took his fee out of the deposit and then wired the remaining amount directly to Coe or to Coe’s road manager's business account.
In approximately May 2009, Coe stopped receiving these payments by wire into his personal bank account after receiving correspondence from the IRS as to his current outstanding tax liabilities. This action prevented the IRS from levying his bank account to pay his income taxes. The remaining balance of the concert fee was to be paid in cash only, by 3:00p.m.on the day of the concert, with no $50 dollar bills allowed as Coe believed they were bad luck and would not gamble with them. Coe’s road manager picked up the cash, which he used to pay himself and the other band members, and then provided the remaining cash to Coe either in person or through MoneyGram or Western Union. Additionally, Coe would sometimes receive cash bonuses from playing concerts. Coe’s arrangement to be paid primarily in cash was also in an effort to impede the ability of the IRS to collect on the taxes owed.
Despite earning income from his concerts, Coe willfully failed to pay the income taxes due and owing when he filed his 2009, 2011 and 2013 individual income tax returns. As a result, Coe now owes the IRS $388,190.94 for the 2009 income tax year, $35,640.10 for the 2011 income tax year and $42,733.82 for the 2013 income tax year, which includes the income taxes owed plus interest and penalties.
Coe also owes restitution to the IRS for the taxes due and owing as a result of his 2008 and 2010 tax returns, which said amount will be determined at the time of sentencing.
"All taxpayers, regardless of their profession, must comply with their federal tax obligations," said Kathy A. Enstrom, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office. “As is evident from Mr. Coe’s guilty plea, schemes to evade the payment of taxes are a violation of the Federal Tax laws and postpones the eventual need to comply at an even higher cost, including federal criminal prosecution and having to pay back taxes with interest and steep penalties."
This case was prosecuted by Assistant United States Attorney Jessica W. Knight and was investigated by special agents of IRS-Criminal Investigation.
Cleveland man sentenced to life in prison for trafficking heroin, robbing rival drug dealersRead the Press Release
The leader of a group that brought large shipments of heroin from Atlanta and Chicago and sold it around the East Side of Cleveland was sentenced to life in prison, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland Office.
Keith Ricks, 33, was convicted on nine counts following a jury trial earlier this year. The jury found that Ricks led a conspiracy that included scores of people, robbed rival drug dealers and used violence to control the sale of heroin in the neighborhood around St. Clair Avenue and East 117th Street.
“This defendant led a group responsible for thefts, violence and the distribution of dozens of pounds of heroin,” Dettelbach said. "He is a predator that needed to be taken out of the community."
“Mr. Ricks is a violent drug dealer that deserves to be behind bars for a long time,” Anthony said. “The Northern Ohio Law Enforcement Task Force works tirelessly to rid the streets of the most dangerous criminals and Keith Ricks definitely is one of them.”
Ricks and others obtained heroin from suppliers in Atlanta and transported the drugs to Cleveland by mail or car. He then distributed the heroin to other traffickers in Cleveland, according to court documents and trial testimony.
Ricks and others planned and committed burglaries and robberies from other drug dealers, customers, and each other. This was done to fund their drug trafficking, to obtain heroin and other drugs, and to collect drug debts. Ricks then sold the stolen heroin at discounted prices or used the stolen money to obtain heroin, according to court documents and trial testimony.
Ricks identified potential victims through a variety of ways, including targeting those who appeared to have expensive jewelry or cars or by using women to gather information about potential victims and report back to them. He sometimes used firearms or zipties to restrain victims, according to court documents and trial testimony.
“Ricks was the leader of a large and wide-ranging heroin conspiracy that involved dozens of people and distributed heroin to large parts of Cleveland,” Assistant U.S. Attorney Matthew W. Shepherd wrote in the sentencing memo. “In addition to distributing heroin, members of the conspiracy committed robberies, thefts and burglaries to obtain heroin or funds to obtain heroin in support of the conspiracy.”
Ricks was among 60 people indicted in federal court in 2013 for their roles in the drug conspiracy. To date, 58 have been found guilty.
This case is being prosecuted by Assistant U.S. Attorneys Matthew W. Shepherd, Daniel J. Riedl and Matthew B. Kall 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.
Chicago Resident Sentenced Forwilliamson County Drug ConspiracyRead the Press Release
On September 11, 2015, Antuan D. Perkins, a/k/a "Little Man," was sentenced for a federal drug violation, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
Perkins, who had previously pled guilty to a one-count indictment charging conspiracy to distribute crack cocaine and heroin, was sentenced to 63 months in federal prison, to be followed by 3 years supervised release, and fined $200.00. The district court awarded Perkins 3 months credit for time previously served on a related state case. The offense occurred between 2012 and May 2014, in Williamson County. Evidence at the plea and sentencing hearings, established that defendant was involved with co-defendant Ahamad Atkins, a/k/a "Omar," "O," and others in the distribution of crack cocaine and heroin in Colp, Illinois. On multiple occasions, defendant and Atkins sold crack cocaine and heroin to confidential sources working for law enforcement. At sentencing, the district court found that Perkins was responsible for the distribution of at least 127 grams of heroin and 45 grams of crack cocaine. Perkins received a sentencing enhancement because he possessed firearms during his drug dealing. Co-defendant Atkins was previously sentenced to 216 months in prison for his role in the crack cocaine and heroin offense.
The ongoing investigation is being conducted by the Southern Illinois Enforcement and Drug Enforcement Administration. The Williamson County State’s Attorney’s Office assisted in the investigation.
The case was assigned to Assistant United States Attorney Amanda A. Robertson for prosecution.
Charleston woman sentenced to more than three years for pill distribution conspiracyRead the Press Release
Huntington, W.Va. – United States Attorney Booth Goodwin announced today that Bridgette Kelly, 23, of Charleston, was sentenced to 37 months in prison for her role in an oxymorphone distribution conspiracy. Beginning in November of 2013 and continuing until January 30, 2014, Kelly conspired with Gregory Lindsey of Detroit, Michigan to distribute oxymorphone pills, commonly known as “Opana”, from a residence at 21A Bailes Drive in Nitro, West Virginia. Lindsey made bi-weekly trips to and from Detroit and brought approximately 100 Opana pills each time for distribution by Kelly and others. Kelly also made trips with Lindsey to Detroit to obtain Opana pills for distribution. On January 30, 2014, officers executed a search warrant at the Bailes Drive residence and located a bag containing 23 30 mg oxymorphone pills, 34 40 mg oxymorphone pills, and a firearm in Lindsey’s possession.
Today’s sentence was imposed by Chief United States District Court Judge Robert C. Chambers.
Lindsey previously plead guilty to possession with intent to distribute oxymorphone and was sentenced to 57 months imprisonment.
The home owner, Jenifer Russell, has entered a guilty plea to maintaining a residence for the purpose of distribution and faces up to 20 years imprisonment when she is sentenced on December 7, 2015.
Karson Williams entered a guilty plea to aiding and abetting the distribution of oxymorphone relating to a controlled buy from the Bailes Drive residence in January of 2014. Williams is also schedule to be sentenced on December 7, 2015.
The case was investigated by the Metropolitan Drug Enforcement Network Team (MDENT). The prosecution is being handled by Assistant United States Attorney Monica D. Coleman.
Chairman of Boston-Based Biomedical Company Arrested in Stock-Fraud SchemeRead the Press Release
BOSTON – The chairman of a Boston-based biomedical company was arrested this morning on charges arising out of his participation in a scheme to defraud the market for the publicly traded stock of the company.
Edward Withrow, III, 51, of Malibu, Calif., was charged in U.S. District Court in Boston with one count of conspiracy, one count of securities fraud, two counts of wire fraud, and two counts of making false statements. Withrow’s co-conspirator, Marco Babini, 54, was charged with one count of conspiracy, one count of securities fraud, and two counts of wire fraud. Babini, who is believed to reside in Vancouver, Canada, remains at large.
In a parallel action, the Securities and Exchange Commission (SEC) announced securities fraud charges today against Withrow, Babini, and a third individual, Samuel Brown, in connection with the scheme. In addition, the SEC charged Withrow with failing to disclose his stock holdings in accordance with federal rules and regulations.
According to the indictment, in November 2012, Withrow became the chairman of Endeavor Power Corporation (Endeavor), a Boston-based biomedical company focused on infectious diseases, and became a significant owner of Endeavor’s stock. Around that time, Withrow, Babini and at least one other individual, allegedly orchestrated a promotional campaign and engaged in manipulative trading designed to inflate investor interest in Endeavor’s publicly traded stock. At that time, Withrow and Babini concealed their significant control over Endeavor’s publicly traded stock from potential investors. In March 2013, the SEC suspended trading in the securities of Endeavor, which stopped the scheme in progress. Thereafter, when Withrow was questioned under oath by SEC attorneys about the Endeavor scheme, he lied about his and others’ involvement.
The charges follow a multi-year investigation focusing on preventing fraud in the microcap stock markets. Microcap companies are small publicly traded companies whose stock often trades at pennies per share. Fraud in the microcap markets is of increasing concern to regulators as such markets have proven to be fertile grounds for fraud and abuse. This is, in part, because accurate information about microcap stocks may be difficult for the average investor to find, since many microcap companies do not file financial reports with the SEC.
Today’s charges follow a series of cases filed by the SEC and the U.S. Attorney for the District of Massachusetts in which more than 20 individuals have been criminally charged and convicted for using kickbacks and other schemes to trigger investment in, or manipulate the stock of, thinly-traded stocks.
The charge of conspiracy and securities fraud provides a sentence of no greater than 25 years in prison, three years of supervised release, and a fine of $250,000, or twice the gross gain or loss. The charge of wire fraud provides a sentence of no greater than 20 years in prison, three years of supervised release, and a fine of $250,000, or twice the gross gain or loss. The charge of making false statements provides a sentence of no greater than five years in prison, three years of supervised release, and a fine of $250,000, or twice the gross gain or loss. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
U.S. Attorney Ortiz and Acting SAC Bonavolonta made the announcement today. The criminal case is being prosecuted by Assistant U.S. Attorney Eric Christofferson of Ortiz’s Economic Crimes Unit and SEC Attorney Eric A. Forni, who was appointed as a Special Assistant U.S. Attorney.
The details contained in the indictment are allegations. The defendants are presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
This case was brought in coordination with President Barack Obama’s 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.
Centralia Woman Sentenced on Federal Drug ChargesRead the Press Release
Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today that Jayme Lee Barnes, 36, of Centralia, Illinois, was sentenced today to 60 months in federal prison, to be followed by 4 years of supervised release, a $200 fine and a $200 special assessment. There is no parole in the federal system.
Court records showed that on June 9, 2015, Barnes entered a guilty plea to an indictment charging her and others with Conspiracy to Manufacture and Distribute Methamphetamine, and Possession of a Listed Chemical (Pseudoephedrine) Knowing It Would Be Used to Manufacture a Controlled Substance. The conspiracy is alleged to have existed from February 28 through October 1, 2014, in Marion and Clinton Counties.
Information leading to the conviction of Barnes was obtained in an investigation conducted by the FBI, the Marion County Sheriff’s Office, and the Clinton County Sheriff’s Department, assisted by the Illinois State Police Methamphetamine Response Team, and the Centralia Police Department. The case is being handled by Assistant United States Attorney Kit Morrissey.
California Army National Guard Member Pleads Guilty to Charges of Recruiting FraudRead the Press Release
FRESNO, Calif. — Nicholas Huerta, 33, of Fresno, pleaded guilty today to one count of wire fraud for a fraud scheme involving military recruiting bonuses, United States Attorney Benjamin B. Wagner announced.
According to court documents, the United States Army contracted with Document and Packaging Broker Inc. (DOCUPAK) to administer the Guard Recruiting Assistance Program (G-RAP). Under G-RAP, members of the California National Guard served as Recruiting Assistants. If a Recruiting Assistant referred a potential Guard member to a recruiting office and that person ultimately enlisted, the Recruiting Assistant was eligible to receive monetary compensation disbursed by DOCUPAK.
Huerta served in the California National Guard as a recruiter. In that position, he had access to names of recruits who had not been referred by any Recruiting Assistant. Huerta pleaded guilty to taking part in a scheme that caused DOCUPAK to issue compensation that was not earned by claiming that various enlistees had been referred by Recruiting Assistants when, in fact, they had not.
This case is the product of an ongoing investigation by the Army Criminal Investigative Command Major Procurement Fraud Unit, the Defense Criminal Investigative Service, and the Federal Bureau of Investigation. Assistant United States Attorney Michael G. Tierney is prosecuting the case.
“As today's guilty plea shows, the Defense Criminal Investigative Service and its law enforcement partners will continue to identify and investigate those individuals who seek to defraud the U.S. taxpayer,” said Special Agent In Charge Chris D. Hendrickson, Defense Criminal Investigative Service, Western Field Office. “Any individual, regardless of position, who attempts to prosper at the expense of the American taxpayer, will be brought to justice.”
“The California National Guard has fully cooperated with the U.S. Attorney's Office and the U.S. Army Criminal Investigation Command regarding these matters, and will continue to do so moving forward, as we expect any who contradict the California National Guard's core values to be held accountable,” said Capt. Will Martin, Public Affairs Officer for the California Military Department.
Huerta is scheduled to be sentenced by United States District Court Judge Lawrence J. O’Neill on December 7, 2015. Huerta faces a maximum statutory penalty of 20 years in prison and a $250,000 fine. The actual sentence, however, will 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.
Seven other National Guard members have been charged in six separate indictments for their roles in similar recruiting‑fraud scheme in Fresno and Sacramento. Brian Kaps, 40, of Chico, pleaded guilty on November 21, 2014, to one count of wire fraud; Sarah Nattress, 27, of Paradise, pleaded guilty on October 23, 2014, to one count of wire fraud, and Leonardo Pesta, 47, of Mountain View, pleaded guilty on July 27, 2015, to one count of wire fraud. The pending charges against the remaining four defendants are only allegations; they are presumed innocent until and unless proven guilty beyond a reasonable doubt.
Boston Man Pleads Guilty to Bronx Murder Arising Out of Dispute over Criminal Prostitution BusinessRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that SAMUEL L. WHITESIDE pled guilty on September 10, 2015, in Manhattan federal court to traveling interstate to commit murder to further his prostitution business, and to persuading, inducing, enticing, and coercing women to travel interstate to engage in prostitution. He pled guilty before U.S. District Judge Paul A. Crotty.
Manhattan U.S. Attorney Preet Bharara said: “Samuel Whiteside has now admitted that he traveled from Boston to New York to murder a rival with whom he had a dispute over his prostitution business. Violence that is so often associated with the prostitution business led to a murder here. Thanks to the work of the FBI and the New York City Police Department, the murderer here has been brought to justice.”
According to the Superseding Indictment, other documents filed in Manhattan federal court, and statements made at various proceedings in this case, including yesterday’s guilty plea:
In the early morning hours of June 5, 2012, WHITESIDE murdered Anthony Martino (the “Victim”) by stabbing him to death in a motel room at the Metro Motel, in the Bronx, New York. WHITESIDE attacked Martino because of a dispute between Whiteside and Martino relating to their respective prostitution businesses.
Specifically, WHITESIDE and the Victim had a dispute about a woman who had worked for WHITESIDE as a prostitute. WHITESIDE believed that the Victim owed WHITESIDE money related to that woman, who had been traded and sold between WHITESIDE and the Victim. In the weeks leading up to Martino’s murder, WHITESIDE searched for Martino in order to confront him about the money he believed Martino owed to him for that prostitute.
On the evening of June 4, 2012, and continuing through the early morning hours of June 5, 2012, WHITESIDE was in telephone contact with Martino and learned that Martino was at the Metro Motel. During the course of that night, WHITESIDE traveled from New England to the Metro Motel. When he arrived, WHITESIDE forced his way into Martino’s room and attacked and stabbed the Victim with a knife three times, which resulted in the Victim’s death.
In addition, between at least January 2012 and February 2013, WHITESIDE operated a prostitution business in which he marketed the sexual services of women to male customers in exchange for money. WHITESIDE took the women to various locations in Massachusetts, Rhode Island, New York, New Jersey, North Carolina, and Illinois to engage in prostitution.
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WHITESIDE, 31, of Dorchester, Massachusetts, faces a maximum of life in prison and eight years of supervised release. The statutory maximum sentence is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. WHITESIDE is scheduled to be sentenced by Judge Crotty on December 8, 2015.
Mr. Bharara praised the investigative work of the Federal Bureau of Investigation and New York City Police Department.
The case is being prosecuted by the Office’s Violent and Organized Crime Unit. Assistant U.S. Attorneys Kan M. Nawaday and Kristy J. Greenberg are in charge of the prosecution.
Bossier City resident pleads guilty to selling firearms to out-of-state resident at gun showRead the Press Release
SHREVEPORT, La. – United States Attorney Stephanie A. Finley announced today that a Louisiana resident pleaded guilty to selling firearms to an out-of-state resident.
Thomas Cleve Veillon, 68, of Bossier City, La., pleaded guilty before U.S. District Judge S. Maurice Hicks Jr. to one count of sale of a firearm to an out-of-state resident. According to evidence presented at the guilty plea, Veillon had numerous firearms for sale at a June 27, 2015 gun show in Shreveport. He was not a federally licensed firearms dealer. Veillon sold a .270 caliber rifle and a Glock .45 caliber pistol to a resident of Arkansas, knowing that the buyer resided out-of-state.
Veillon faces up to five years in prison, one to three years of supervised release and a $250,000 fine. A sentencing date of January 4, 2016 was set.
This investigation and prosecution is part of Project Safe Neighborhoods, which is a Department of Justice initiative to reduce firearm crimes by preventing the possession and use of firearms by dangerous and persistent felons and others not authorized to possess a firearm and to promote firearm safety.
The ATF conducted the investigation. Assistant U.S. Attorney Robert W. Gillespie Jr. is prosecuting the case.
Arizona man sentenced for cocaine traffickingRead the Press Release
CLARKSBURG, WEST VIRGINIA – Kwane Baker, 39, of Buckeye, Arizona, was sentenced today to 37 months in prison for cocaine trafficking, United States Attorney William J. Ihlenfeld, II, announced.
An investigation by the Mon Metro Drug and Violent Crime Task Force revealed that Baker sold crack cocaine in Monongalia County, West Virginia in July 2014. He pled guilty in May 2015 to one count of “Distribution of Cocaine Base.”
Assistant U.S. Attorney Zelda Wesley prosecuted the case on behalf of the government.
U.S. District Judge Irene M. Keeley presided.
Altamont Man Pleads Guilty to Identity Theft, Extortion, and Child Pornography OffensesRead the Press Release
On September 14, 2015, Stephen B. Mislich, 24, of Bowling Green, Ohio, formerly of Altamont, Illinois, pled guilty to identity theft, extortion, and child pornography offenses, United States Attorney for the Southern District of Illinois Stephen R. Wigginton, announced today.
Evidence at the plea hearing established that Mislich stole the online identity of a victim from Effingham County, Illinois, and then used that identity to extort and attempt to extort nude images and videos form several other victims in the area. One of the victims was 16 years old at the time of the offense and the images Mislich forced her to produce constituted child pornography under federal law.
The offenses carry a maximum penalty of 63 years in federal prison, $2,000,000 in fines, and a lifetime of supervised release. Sentencing is currently scheduled to occur on December 29, 2015, at 10:00 a.m. Mislich continues to be held without bond pending sentencing. The investigation was conducted by the Federal Bureau of Investigation and the Effingham Police Department. The case is assigned to Assistant United States Attorney Thomas E. Leggans.