Latest Records
Newest first across public DOJ and U.S. Attorney press releases.
9 September 2015
Boston Woman Sentenced to Federal Prison for Role in New Hampshire Credit Card FraudRead the Press Release
CONCORD, N.H. – Acting United States Attorney Donald Feith announced that today Laura A. Minot was sentenced to twenty-five months in federal prison after she had pleaded guilty to one count of Conspiracy to Commit Access Device (Credit Card) Fraud and one count of Aggravated Identity Theft. Minot’s guilty pleas arose from her role in a fraudulent credit card scheme. Minot, age 52, resides in the Mattapan neighborhood of Boston, Massachusetts.
During her prior plea hearing, Minot admitted that on April 16, 2014, she conspired with others to purchase gift cards and high value merchandise at retail box stores in New Hampshire and Massachusetts using retail credit card accounts and lines of credit that she and/or co-conspirators opened in the names of other actual persons without their authorization or knowledge. Minot further admitted that she and co-conspirators opened the credit card accounts and lines of credit using misappropriated personal identifying information and false identification cards. Minot also admitted to wearing a disguise to facilitate some of the illegal transactions.
United States District Judge Paul J. Barbadoro sentenced Minot to twenty-four months incarceration on the Aggravated Identity Theft count and one consecutive month on the Conspiracy to Commit Access Device (Credit Card) Fraud. In addition to the terms of imprisonment, Judge Barbadoro sentenced Minot to a term of supervised release of three years and ordered her to pay restitution to the victims of her fraud. While on supervised release, Minot will have to abide by rules established by the court, including paying restitution. If she fails to do so, she could be required to serve more time in prison.
The investigation of Minot’s offenses was conducted and coordinated by the Boston office of the U.S. Secret Service and the Medway (Mass.) and Cambridge (Mass.) Police Departments. The Massachusetts State Police and local police departments in Acton, Ayer, Bedford, Boston, Brookline, Cohasset, Dover, Groton, Lincoln, Littleton, Medfield, Medford, Norton, Plymouth, Reading, Sudbury, Sutton, Tewksbury, Tyngsboro, Watertown, Wayland, Wellesley, Weston and Westwood, Massachusetts, and Hollis, New Hampshire, also assisted in the investigation. The case was prosecuted by Assistant U.S. Attorney Bill Morse.
Birmingham Woman Sentenced for Stealing Grandmother's Social Security Benefits for 21 YearsRead the Press Release
BIRMINGHAM -- A federal judge today sentenced a Birmingham woman to six months in prison and six months home detention for stealing Social Security benefits intended for her grandmother for more than 21 years after her grandmother died, announced U.S. Attorney Joyce White Vance and Social Security Administration Office of Inspector General Resident Agent in Charge Marvin Mauldin.
U.S. District Judge Sharon Lovelace Blackburn ordered WENDI D. BALDWIN, 47, to forfeit $30,934 to the government as proceeds of illegal activity and to pay that same amount in restitution to the Social Security Administration. Baldwin stole more than $155,000 in benefits, but the statute of limitations on the theft charge restricted the government to recovering only five years' worth of benefits. Baldwin pleaded guilty in February to one count of theft of government property.
According to Baldwin's plea agreement with the government, she stole the SS Retirement, Survivors and Disability Insurance benefits between January 1992 and July 2013, following her grandmother's death in December 1991. The benefits were being deposited directly into a bank account Baldwin held jointly with her grandmother. Baldwin failed to notify the Social Security Administration when her grandmother died and converted the benefits to her personal use, according to Baldwin's plea.
The SSA discovered the theft of funds in 2013 after several failed attempts to contact Baldwin's grandmother.
The SSA-OIG investigated the case, which Assistant U.S. Attorney Xavier O. Carter Sr. is prosecuting.
Bergen County, New Jersey, Man Admits He Conspired to Provide Material Support to ISILRead the Press Release
NEWARK, N.J. – A Bergen County, New Jersey, man admitted today that he conspired to provide material support to the Islamic State of Iraq and the Levant (ISIL), a designated foreign terrorist organization, U.S. Attorney Paul J. Fishman, Assistant Attorney General for National Security John P. Carlin, and Special Agent in Charge Richard M. Frankel of the FBI’s Newark Division announced.
Samuel Rahamin Topaz, 21, of Fort Lee, New Jersey, pleaded guilty before U.S. District Judge Susan D. Wigenton in Newark federal court to an information charging him with one count of conspiring with others to provide services and personnel to ISIL. He remains detained without bail.
“The crimes Samuel Topaz admitted today threatened the safety of Americans here and abroad,” U.S. Attorney Fishman said. “Our efforts to cut off the flow of fighters and resources to known terrorist organizations will not stop with his guilty plea. We have charges pending against his conspirators and remain vigilant against these terrorist operations.”
“Samuel Rahamin Topaz conspired to provide material support to ISIL and sought to travel overseas with others to fight on behalf of the designated foreign terrorist organization,” Assistant Attorney General Carlin said. “Counterterrorism is the National Security Division’s highest priority, and we remain committed to stemming the flow of foreign fighters abroad and bringing to justice those who attempt to provide material support to terrorists.”
“Samuel Topaz admitted to conspiring to provide material support to the Islamic State of Iraq and the Levant (ISIL) today in the U.S. District Court of New Jersey,” Special Agent in Charge Frankel said. “Now Topaz will face up to 20 years in prison rather than take up arms overseas. Disrupting recruitment efforts by terrorist organizations and preventing acts of terror remains the FBI’s number one priority, and due to the unflagging efforts of the Newark FBI’s Joint Terrorism Task Force this threat was eliminated. I ask the citizens of New Jersey to remain vigilant and contact the FBI if they see or hear something suspicious.”
According to documents filed in this and related cases and statements made in court:
Topaz admitted that prior to his arrest by the FBI Joint Terrorism Task Force on June 17, 2015, he planned to travel overseas to join ISIL and had saved up money for that purpose. Topaz discussed plans to join ISIL with Nader Saadeh, Alaa Saadeh, and Munther Omar Saleh, and admitted that at various times each of them indicated that they wanted to join ISIL. Topaz also admitted they all watched ISIL-related videos, some of which depicted the execution of non-Muslims and individuals regarded as apostates from Islam.
On May 5, 2015, Nader Saadeh departed the United States with plans to travel overseas to join ISIL as part of the conspiracy, according to Topaz’s statements in court today. Topaz further admitted that he and others planned to travel overseas separately, meet up with Nader Saadeh, and then travel together to join ISIL. After Nader Saadeh left the United States, Topaz met with Munther Omar Saleh and contacted Alaa Saadeh to discuss those plans.
Topaz admitted knowing that ISIL was a designated terrorist organization and was taking over territory overseas, expelling non-Muslims from their homes, and executing individuals who did not obey ISIL’s commands.
The count of conspiracy to provide material support to a designated foreign terrorist organization carries a maximum potential penalty of 20 years in prison and a fine of $250,000. Sentencing is scheduled for Nov. 18, 2015.
Topaz’ alleged conspirators are being prosecuted and are currently in federal custody. Nader Saadeh and Alaa Saadeh have been charged in separate criminal complaints brought by the U.S. Attorney’s Office for the District of New Jersey with conspiring to provide material support to ISIL, among other charges. Munther Omar Saleh has been indicted on terrorism-related charges brought by the U.S. Attorney’s Office for the Eastern District of New York. The charges and allegations against them are merely accusations, and they are presumed innocent unless and until proven guilty.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Frankel in Newark, and the JTTF, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorneys L. Judson Welle, Dennis C. Carletta, and Francisco J. Navarro of the U.S. Attorney’s Office National Security Unit in Newark, with assistance the assistance of Trial Attorney Robert Sander of the National Security Division’s Counterterrorism Section.
Defense counsel: Ian J. Hirsch Esq., Hackensack, New Jersey
Bend Area Plumber Pleads Guilty to Filing False Federal Tax Returns and Omitting $1.6 Million in IncomeRead the Press Release
EUGENE, Ore. –Yesterday, Gary L. Ford, 55, of Bend, Oregon, pled guilty to willfully filing a false federal income tax return. As part of his plea agreement, Ford, the owner and operator of Summit Plumbing in Bend, Oregon, admitted that he failed to report more than $1.6 million of income on his federal tax returns for tax years 2006 through 2009. Ford also admitted that he was responsible for all of his plumbing business’s and his personal financial record keeping, including accounting, sales, and invoicing, and that he prepared the federal income tax returns and related schedules.
Sentencing is set for January 5, 2016, at 10 a.m. before Chief U.S. District Judge Ann Aiken. The maximum penalty for filing a false return is three years in prison and a $100,000 fine.
This case was investigated by IRS Criminal Investigations and is being prosecuted by Assistant U.S. Attorney Scott E. Bradford.
Baltimore Man Guilty of Child Exploitation Charges in East TexasRead the Press Release
BEAUMONT, Texas — A 36-year-old Baltimore, MD man has pleaded guilty to child exploitation charges in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Ian Christian Anderson pleaded guilty to enticement of a minor today before U.S. Magistrate Judge Zack Hawthorne.
According to information presented in court, in January 2015, Anderson began an on-line relationship with a 14-year-old girl in the Eastern District of Texas. After several weeks of communicating with the victim, Anderson traveled from his home near Baltimore, Md., to the victim's hometown in Texas, on two separate occasions in February and March 2015. On both trips Anderson engaged in sexual relations with the 14-year-old that constituted felony sexual assault under the laws of the State of Texas. Anderson also used his cellular telephone to send sexually explicit text messages to the victim in which he attempted to persuade her to engage in future similar sexual relations. Anderson was indicted by a federal grand jury on May 7, 2015.
Anderson faces a minimum of 10 years and up to life in federal prison at sentencing. A sentencing date has not been set.
This case is being prosecuted as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case is being investigated by the Federal Bureau of Investigation, the Lumberton Police Department and the Hardin County Sheriff’s Office. This case is being prosecuted by Assistant U.S. Attorney Joseph R. Batte.
Arkansas Man Pleads Guilty to Armed Robberies of Bank, 11 Other Businesses in Five StatesRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Bella Vista, Ark., man pleaded guilty in federal court today to a series of a dozen armed robberies at a Missouri bank and 11 other businesses across five states during the summer of 2013.
Timothy Patrick Hoyt, 45, of Bella Vista, pleaded guilty before U.S. Magistrate Judge Matt J. Whitworth to the charges contained in a federal indictment in the Western District of Missouri, as well as the charges contained in four separate cases in four different federal districts in Kansas, South Dakota, Nebraska and Oklahoma, all of which have been transferred to the Western District of Missouri.
By pleading guilty today, Hoyt admitted that he used what appeared to be a handgun (but which later was identified as a .177-caliber pellet or BB gun) to rob a bank in Missouri and 10 other businesses, including eight fast food restaurants, across five states between June 26 and Aug. 6, 2013.
Hoyt pleaded guilty to all four counts of the indictment filed in the Western District of Missouri. Hoyt stole $5,123 from Alliant Bank, 118 Main St., Blackwater, Mo., on June 26, 2013, with what appeared to be a handgun. Hoyt also used what appeared to be a handgun to rob the Subway restaurant at 330 N. Massey Blvd., Nixa, Mo., on July 12, 2013; the Subway restaurant at 1820 W. 32nd St., Joplin, Mo., on July 14, 2013; and the Sally Beauty Supply Store at 2007-C W. Foxwood Dr., Raymore, Mo., on Aug. 6, 2013.
Hoyt also pleaded guilty to using what appeared to be a handgun to rob the Subway restaurant at 715 N. G Street, Wellington, Kan., on July 17, 2013; the Domino’s Pizza Restaurant at 1108 S. Minnesota Ave., Sioux Falls, S. D., on July 19, 2013; the Subway restaurant at 1116 E. 10th St., Sioux Falls on July 20, 2013; the Godfather’s Pizza restaurant at 15234 W. Maple Rd., Omaha, Neb., on July 23, 2013; and the Arby’s restaurant at 6919 S. Lewis Ave., Tulsa, Okla., on July 27, 2013.
In addition to those robberies with which Hoyt has been charged, he also admitted that he used what appeared to be a handgun to rob the Papa Murphy’s Pizza restaurant at 302 W. 28th St., Sioux City, Iowa, on July 21, 2013; the Payless ShoeSource store at 7714 State Ave., Kansas City, Kan., on July 26, 2013; and the Papa Murphy’s Pizza restaurant at 3418 8th St. S.W., Altoona, Iowa, on Aug. 7, 2013.
Hoyt was arrested after robbing the Papa Murphy’s Pizza restaurant in Altoona. According to today’s plea agreement, he told law enforcement officers that he shoplifted the pellet gun from a Walmart store near Blackwater before using it to rob Alliant Bank.
Under federal statutes, Hoyt is subject to a sentence of up to 20 years in federal prison without parole, plus a fine up to $250,000 and an order of restitution for each of the robberies. 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 Lawrence E. Miller. It was investigated by FBI; the Cooper County, Mo., Sheriff’s Department; the Altoona, Iowa, Police Department; the Nixa, Mo., Police Department; the Joplin, Mo., Police Department; the Raymore, Mo., Police Department; the Wellington, Kan., Police Department; the Sioux Falls, S.D., Police Department; the Sioux City, Iowa, Police Department; the Omaha, Neb., Police Department; the Kansas City, Kan., Police Department; and the Tulsa, Okla., Police Department.
Ambulance Company Owner Charged in Medicare Fraud SchemeRead the Press Release
PHILADELPHIA – Zahar Tkach, also known as Alex Tkach, of Bensalem, PA, was charged by indictment, unsealed today, in a scheme to defraud Medicare of approximately $1.25 million by charging for unnecessary ambulance services, announced by United States Attorney Zane David Memeger. Tkach is charged with health care fraud, obstruction of a federal audit and laundering criminal proceeds.
Tkach owned NovaCare Ambulance Services, Inc. (also called “Novocare Ambulance”) and Cardiac Care Ambulance, Inc. (“Cardiac Care”), operating primarily in Philadelphia and the surrounding counties. According to the indictment, between June 2008 and April 2012, Tkach recruited and transported dialysis patients who needed treatments three times per week, thereby allowing him to bill Medicare extensively for those patients, when the ambulance services were not medically necessary for those patients. When Medicare audited the 2011 billings of Novocare and Cardiac Care, the defendant is alleged to have obstructed the audits by altering, and directed employees to alter, ambulance transport records and he falsified medical authorization forms, all of which he submitted to the Medicare auditors to support the fraudulent billings.
According to the indictment, the two ambulance companies shared resources, including employees and patients. Tkach managed both companies’ operations, finances and billings. The defendant also is alleged to have laundered the fraud proceeds in financial transactions of $10,000 or more.
Tkach was charged with 15 counts of health care fraud, two counts of obstructing a federal audit, and two counts of laundering monetary transactions over $10,000. If convicted, he faces up to 10 years in prison for each count of health care fraud; up to five years in prison for each count of obstruction of a federal audit; and 10 years in prison for money laundering. The defendant also faces a possible fine of $250,000 per count.
This case was investigated by the FBI and the Department of Health and Human Services-Office of the Inspector General. It is being prosecuted by Assistant U.S. Attorney Andrea Foulkes.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Albuquerque Man Sentenced to 133 Months in Prison for Federal Drug Trafficking and Firearms ChargesRead the Press Release
ALBUQUERQUE – Jean Claud Mills, 32, of Albuquerque, N.M., was sentenced today in federal court to 133 months in prison followed by three years of supervised release for his conviction on methamphetamine trafficking and firearms charges.
Mills was arrested on May 16, 2014, on a criminal complaint charging him with possession of methamphetamine with intent to distribute and using and carrying a firearm in furtherance of a drug trafficking crime. Mills subsequently was indicted on June 11, 2014, and charged with (1) possession of methamphetamine with intent to distribute, (2) being a felon in possession of firearms and ammunition, and (3) using and carrying a firearm in relation to a drug trafficking crime. Court records reflect that in May 2014, Mills was prohibited from possessing firearms and ammunition because he previously had been convicted of felony offenses including possession of narcotics with intent to distribute and conspiracy to tamper with evidence.
According to the criminal complaint, on May 15, 2014, Mills attempted to sell a pound of methamphetamine to undercover detectives of the Albuquerque Police Department (APD) for $13,000.00. The APD detectives recovered a handgun and two magazines of ammunition from an open glove compartment in Mills’ vehicle.
On March 31, 2015, Mills pled guilty to Counts 1 and 2 of the indictment. Mills admitted that on May 15, 2014, he sold a pound of methamphetamine to two men for $13,000.00, and was arrested by law enforcement officers before he got into his vehicle to leave. Mills further admitted that on that day he possessed a firearm even though he was a convicted felon and was on probation.
This case was investigated by the Border Enforcement Security Task Force of the Albuquerque office of Homeland Security Investigations (HSI) and APD. Assistant U.S. Attorney Presiliano Torrez prosecuted the case.
8 September 2015
Zuni Pueblo Man Sentenced for Sexually Abusing a ChildRead the Press Release
ALBUQUERQUE – Vernon Niiha, 54, a member of Zuni Pueblo who resides in Blackrock, N.M., was sentenced this morning in Albuquerque, N.M., to 36 months in prison followed by three years of supervised release for his abusive sexual contact conviction. Niiha will also be required to register as a sex offender.
Niiha was arrested in Aug. 2013, on an indictment charging him with sexually abusing a child under the age of 12 years. According to the indictment, Niiha committed the crime at some time between March 2002 and March 2003, in Zuni Pueblo in McKinley County, N.M.
On Feb. 25, 2015, Niiha entered a guilty plea to a felony information charging him with abusive sexual contact, and admitted sexually abusing the victim.
This case was investigated by the Albuquerque office of the FBI and Zuni Pueblo Tribal Police Department, and was prosecuted by Assistant U.S. Attorney Kyle T. Nayback.
The case was filed 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/.
West Suburban Doctor Pleads Guilty to Causing $4 Million Loss to Medicare by Falsely Approving Unnecessary TreatmentRead the Press Release
CHICAGO — A west suburban physician pleaded guilty in federal court today to a charge that he fraudulently certified Medicare patients as confined to the home, allowing healthcare agencies to bill Medicare for unnecessary in-home treatment.
As an employee and part-owner of Bloomingdale-based Home Care Physicians Inc., DR. ARTHUR DAVIDA received referrals from home-health agencies asking him to certify the patients as confined to the home. Although he knew that at least 20 percent of the patients were not confined to the home, Davida nonetheless provided the certification – allowing the agencies to bill Medicare for treatment that Davida knew was not medically necessary, according to a written plea agreement. Davida provided the certifications because he feared that, if he didn’t, the home-health agencies would stop sending him the referrals, the plea agreement states.
Davida, 62, of Bloomingdale, pleaded guilty to a health care fraud charge contained in a criminal information. He faces a maximum sentence of ten years in prison when U.S. District Judge John J. Tharp Jr. sentences him on December 16, 2015, at 1:30 p.m.
Per Medicare’s rules, patients need to be certified as confined to the home before Medicare will pay for the specialized nursing care available to such individuals. A physician’s certification is provided on a patient’s plan of care, which is typically prepared by the home-health agencies that perform the service. According to the plea agreement, Davida began working at Home Care Physicians in 2009, and started conducting in-home visits in 2010. From 2010 and continuing through August 2013, Davida certified numerous patients as confined to the home and needing skilled nursing services, when, in fact, they were able to leave their homes and did not need such services, according to the plea agreement.
The certifications caused the home-health agencies to submit claims to Medicare for payment of bills pertaining to medically unnecessary services, the plea agreement states. Home-health agencies were paid more than $20 million by Medicare based on orders signed by Davida. Given his admission that 20 percent of these patients were not confined to the home, Davida acknowledged in the plea agreement that he caused losses of at least $4 million to the Medicare program.
The guilty plea was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; John A. Brown, Acting Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation; and Lamont Pugh III, Special Agent-in-Charge of the Chicago Region of the U.S. Department of Health and Human Services Office of Inspector General.
The investigation was carried out by the Medicare Fraud Strike Force, which consists of agents from the Federal Bureau of Investigation and the U.S. Department of Health and Human Services, and prosecutors from the U.S. Attorney’s Office and the Justice Department’s Fraud Section. The strike force is part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative between the Department of Justice and HHS to prevent fraud and to enforce anti-fraud laws around the country.
The government is represented by Assistant United States Attorney Stephen Chahn Lee.
To report health care fraud or to learn more about the Health Care Fraud Prevention & Enforcement Action Team (HEAT), logon to: StopMedicareFraud.gov.
Plea Agreement
Watertown Man to Serve Prison Time for Role in Bank Fraud SchemeRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that JASON CALABRESE, 44, of Watertown, was sentenced today by U.S. District Judge Janet Bond Arterton in New Haven to six months of imprisonment, followed by three months of home confinement and two years of supervised release, for his involvement in a series of fraudulent mortgage loan applications. CALABRESE also was ordered to pay a $3,000 fine and $400,585 in restitution.
According to court documents and statements made in court, in November 2005, CALABRESE’s co-conspirator, Thomas Provenzano, obtained a $923,200 loan to purchase a lakefront home located at 27 Palmer Road in Morris for more than $1.1 million, despite lacking the income to pay off the mortgage. The 27 Palmer Road property was owned by an entity controlled by Ryan Geddes, another co-conspirator. To finance the purchase, Provenzano applied for a mortgage through CALABRESE, who was a mortgage broker. The mortgage loan application contained statements that CALABRESE knew were false, namely, that Provenzano had worked for the past four years as the “General Manager” for a Geddes-owned construction company, and that Provenzano’s income from the listed job was $20,000 per month, or $240,000 per year. In fact, Provenzano’s income was substantially less than that amount. CALABRESE submitted the false loan application to a lender, which issued a $923,000 mortgage. At the closing, CALABRESE’s mortgage company was paid a $32,312 broker’s fee.
In November 2006, Provenzano applied for a new mortgage through CALABRESE to refinance the November 2005 mortgage for the 27 Palmer Road property. The mortgage refinancing application also contained statements that CALABRESE knew were false, namely, that Provenzano had worked for the past five years at Geddes’s construction company, and that Provenzano’s income from the listed job was $28,000 per month, or $336,000 per year. CALABRESE submitted the false loan application to a federally-insured lender, which issued a $936,000 mortgage. At the closing, CALABRESE’s mortgage company was paid an $18,720 broker’s fee.
The 2005 loan application had stated that Provenzano would reside in the 27 Palmer Road property as an owner-occupant. In fact, Geddes and his family continued to reside in the property. For a few years, Geddes paid Provenzano “rent,” which Provenzano used to cover the mortgage payments. But when Geddes moved out of the 27 Palmer Road property, he stopped forwarding payments to Provenzano, who stopped paying the mortgage. Accordingly the 27 Palmer Road property went into foreclosure.
On May 5, 2015, CALABRESE pleaded guilty to one count of conspiracy to commit bank fraud.
Provenzano and Geddes previously pleaded guilty. On December 1, 2014, Provenzano was sentenced to 18 months of imprisonment. Geddes awaits sentencing.
This matter is being investigated by the Federal Bureau of Investigation and the Internal Revenue Service – Criminal Investigation Division. The case is being prosecuted by Assistant U.S. Attorneys Henry Kopel and Michael Gustafson.
Virginia Man Charged with Traveling to PA for Sex with a MinorRead the Press Release
ERIE, Pa. - A former resident of Ashland, Virginia, has been indicted by a federal grand jury in Erie on charges of violating federal laws relating to the sexual exploitation of children, United States Attorney David J. Hickton announced today.
The three-count indictment named Kerry Eccles, 60, as the sole defendant.
According to the indictment presented to the court, Eccles traveled to Erie from Virginia for the purpose of engaging in sexual conduct with a minor. While in Erie, Eccles took sexually explicit photos of a ten year old victim.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
The law provides for a maximum total sentence of 90 years in prison, a fine of $750,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Christian A. Trabold is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation, the Pennsylvania State Police and the Erie County Detectives conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Utah Man Sentenced for Fraudulently Concealing and Transferring Assets in BankruptcyRead the Press Release
BOISE – Farrell Larson, 67, of Meadow, Utah, was sentenced today to five years of probation and 100 hours of community service for fraudulent transfer and concealment of assets in a bankruptcy, U.S. Attorney Wendy J. Olson announced. Senior U.S. District Judge Edward J. Lodge also ordered Larson to pay restitution in the amount of $47,000.
According to the plea agreement, Larson was the president and co-owner of Select Onion and Larson Land Company, LLC, which operated an onion farm and onion processing plant in Ontario, Oregon. Larson Land Company merged with Select Onion and filed Chapter 11 bankruptcy in the District of Idaho in 2012, with Larson signing as debtor. On April 19, 2012, the Honorable Terry L. Myers, Chief Bankruptcy Judge for the District of Idaho, held that Larson could not utilize cash collateral of Larson Land Company or Select Onion. In his plea agreement, Larson admitted that on April 20 and 23, 2012, he caused a total of $56,000 in cash to be withdrawn from Select Onion bank accounts. The cash represented assets obtained by Select Onion after the filing of bankruptcy. The withdrawals and subsequent transfer of the money was done without the knowledge or authorization of the bankruptcy court or trustee. In his plea agreement, Larson admitted to knowingly concealing assets from the trustee, his creditors, and the bankruptcy court with the intent to defraud.
The case was investigated by the Special Inspector General for the Troubled Asset Relief Program, the Internal Revenue Service, the Office of Inspector General for the Federal Deposit Insurance Corporation, and the Federal Bureau of Investigation.
Two convicted of cocaine traffickingRead the Press Release
ELKINS, WEST VIRGINIA – Eulogio Rodriguez-Fernandez, 58, of Martinsburg, West Virginia, and Santos Macedoni Barragan, 31, of Moorefield, West Virginia, were convicted of cocaine trafficking today in federal court, United States Attorney William J. Ihlenfeld, II, announced.
Barragan sold cocaine near an elementary and secondary school in Hardy County, West Virginia. He pled guilty today to one count of “Distribution of Cocaine within 1,000 Feet of a School.” He faces between one and forty years in prison and a fine of up to $2,000,000.
Rodriguez-Fernandez was discovered in possession of cocaine in Hardy County, West Virginia. He pled guilty today to one count of “Possession with Intent to Distribute Cocaine.” 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 defendants.
Assistant U.S. Attorney Stephen Warner prosecuted the case on behalf of the government. The Eastern Panhandle Drug and Violent Crime Task Force, a HIDTA-funded initiative, investigated.
U.S. Magistrate Judge John S. Kaull presided.
Two Florida Residents Sentenced to Prison for Posession of Counterfeit Access Devices with Intent to DefraudRead the Press Release
Jackson, Miss – Fedric Amos Remy, 28, and Geovanni Corrado Davis, 30, both of Kissimmee, Florida, were sentenced today by U.S. District Judge William H. Barbour, Jr., to 21 months in prison followed by three years of supervised release for knowingly possessing 15 or more counterfeit access devices with the intent to defraud, announced U.S. Attorney Gregory Davis.
As the result of an investigation pursuant to a traffic stop conducted by Madison Police Department on January 28, 2015, Remy and Davis were found to be in possession of more than 30 counterfeit credit cards and multiple forms of false identification. Remy and Davis were indicted by a federal grand jury and pled guilty on June 30, 2015.
This case was investigated by the U.S. Secret Service and the Madison Police Department. It was prosecuted by Assistant U.S. Attorney Chris Wansley.
Tax Charges Filed Against Former Traffic Court JudgeRead the Press Release
PHILADELPHIA - Michael Sullivan, 51, of Philadelphia, was charged in a criminal information, filed today, with one count of failure to report and pay payroll taxes, announced United States Attorney Zane David Memeger. The charges relate to Sullivan’s failure to report and pay payroll taxes for employees of the Fireside Tavern, South Marshall Street, Philadelphia. Sullivan was an owner and operator of the Tavern. Sullivan was a judge for the former Philadelphia Traffic Court.
If convicted, Sullivan faces a maximum possible sentence of one year imprisonment, one year supervised release, a $25,000 fine, and a $25 special assessment.
The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service is being prosecuted by Assistant United States Attorney Paul L. Gray.
An Information is an accusation. A defendant is presumed innocent unless and until proven guilty.
Second Marion man indicted for selling heroin and fentanyl that resulted in overdose deathRead the Press Release
Another Marion man was indicted for the sale of heroin and fentanyl that resulted in an overdose death, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio, and U.S. Drug Enforcement Administration’s Special Agent in Charge Joseph P. Reagan.
Rashawn D. Thomas was charged with the distribution of heroin and fentanyl that resulted in the death of Christopher Wolford.
Eric L. Creagh, 32, was previously indicted on multiple counts related to the distribution of drugs and Wolford’s death. Thomas and Creagh are accused of selling heroin and fentanyl on May 22 that resulted in the death of Christopher Wolford.
“This defendant is charged with selling the blue-drop heroin that caused so many overdoses, heartache and even death,” Dettelbach said. “The DEA is to be commended for working with the local police to protect the citizens of Marion. This case should serve as yet another reminder that heroin and fentanyl should be avoided. Trying heroin is not only a mistake -- it may be the last mistake a person ever makes.”
Reagan said: “We have made it a priority to investigate the distribution of narcotics that result in death. Today’s charges send a strong message to all narcotic traffickers that they will face real consequences, for the harm that they inflict on the user and society. The level of cooperation by all of the law enforcement agencies in this investigation has been extraordinary and serves as a model for the future.”
This case is being prosecuted by Assistant U.S. Attorneys Michael Freeman and Thomas Weldon following an investigation by the Drug Enforcement Administration, MARMET, the Marion Police Department, the Marion County Sheriff's Office and the Ohio Bureau of Criminal Investigation.
If convicted, the defendants’ sentences will be determined by the court after a review of the federal sentencing guidelines and factors unique to the case, including the defendant’s prior criminal record (if any), the defendant’s role in the offense and the characteristics of the violation.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Schuele Boys Gang Associate Pleads Guilty to Drug ChargeRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
BUFFALO, N.Y. — U.S. Attorney William J. Hochul, Jr. announced today that Tyrell Skipper, 25, of Buffalo, pleaded guilty to conspiracy to distribute cocaine before U.S. District Judge Richard J. Arcara. The charge carries a maximum penalty of 20 years in prison, and a $1,000,000 fine.
Assistant U.S. Attorney George C. Burgasser, who is handling the case, stated that between June 2013 and July 23, 2014, Skipper conspired with co-defendants Michael Robertson, Antwan Steward, and others to distribute cocaine in the City of Buffalo. In addition, the defendant maintained a premises at 2 Cleveland Drive in Buffalo for the purpose of distributing cocaine. During the course of the conspiracy, Skipper was in possession of a firearm.
The Schuele Boys Gang, which operated in the Schuele Street area of the East Side of Buffalo, is believed to be responsible for multiple acts of violence and the distribution of illegal narcotics including cocaine, crack cocaine and marijuana.
Skipper is one of 28 Schuele Boys Gang members and associates arrested in this case. To date, 12 of the defendants have been convicted.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
The plea is the culmination of an investigation on the part of the FBI's Safe Streets Task Force which includes representatives of the Amherst Police Department; the Buffalo Police Department; U.S. Border Patrol, the Bureau of Alcohol, Tobacco, Firearms, and Explosives; the Cheektowaga Police Department; the Erie County Sheriff’s Department; the Hamburg Police Department; the Lancaster Police Department; the Niagara Frontier Transportation Authority Police; the New York State Department of Correctional Services; the New York State Police; and U.S. Immigration and Customs Enforcement, Homeland Security Investigations. Additional assistance was provided by the Drug Enforcement Administration; U.S. Customs and Border Protection, the United States Marshal Service, the Lackawanna Police Department, and the Niagara County Sheriff’s Department.Skipper will be sentenced on December 18, 2015 at 1:00 p.m. before Judge Arcara.
Resident of Ireland Sentenced for Child ExploitationRead the Press Release
PHILADELPHIA - Peter Douglas McGarry, 50, a native of Ireland, was sentenced today to 47 months in prison for possession of child pornography and accessing child pornography on the internet with the intent to view child pornography. McGarry possessed child pornography on a Microsoft computer storage account on April 5, 2014, and was accessing internet sites with the intent to view child pornography on five dates between September 6, 2014 and October 25, 2014. McGarry was in Philadelphia when he committed the offenses.
McGarry pleaded guilty on April 14, 2015, admitting that on April 5, 2014, he possessed five images of prepubescent minors engaged in sexually explicit conduct, which were produced using minors engaged in such conduct. He agreed that he had kept these images on a Microsoft Skydrive account associated with his email address, and which was his account which he accessed with his cell phone. McGarry also admitted that he accessed sites on the internet which displayed images of prepubescent minors engaged in sexually explicit conduct, which were produced using minors engaged in such conduct, on specific dates in September and October of 2014. McGarry’s cell phone also contained an additional 61 images of minors engaged in sexually explicit conduct. In addition, records from Google concerning McGarry’s gmail account, associated with his computer, showed that he had accessed 25 child exploitation images on the internet between August and October of 2014.
In addition to the prison term, U.S. District Court Judge Wendy Beetlestone ordered five years of supervised release, a $1,000 fine, a $600 special assessment, forfeiture of his cell phone and his computer.
The case was investigated by Homeland Security Investigations and was prosecuted by Assistant United States Attorney Albert S. Glenn.
Puerto Rican Pleads Guilty to Participating in Interstate Drug Trafficking OrganizationRead the Press Release
PITTSBURGH – Adalberto Davila, a resident of Puerto Rico, pled guilty to conspiring to traffic kilograms of cocaine and heroin in Western Pennsylvania, United States Attorney David J. Hickton announced today.
Davila, 42, pled guilty to conspiring to distribute at least five kilograms of cocaine and at least one kilogram of heroin between 2011 and 2013 in the Pittsburgh area. Chief United States District Judge Joy Flowers Conti accepted the guilty plea and scheduled sentencing to occur on Dec. 16, 2015, at 3:30 p.m.
Davila was part of an interstate drug trafficking organization that operated in several locations throughout the United States. Davila was part of the multi-jurisdictional supply chain that resulted in the distribution of, among other things, numerous kilograms of cocaine and heroin in Western Pennsylvania between 2011 and 2013.
The law provides for a maximum total sentence of not less than 10 years and up to life in prison, a fine of $10,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorneys Katherine A. King and Craig W. Haller are prosecuting this case on behalf of the United States.
A task force led by the Drug Enforcement Administration conducted the investigation leading to the conviction in this case. The task force also included several other federal, state, and local agencies from multiple states, including the Internal Revenue Service Criminal Investigation Division, the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the United States Marshals Service, the Pennsylvania State Police, the Allegheny County District Attorney’s Office, the Pittsburgh Bureau of Police, the Allegheny County Police Department, the Penn Hills Police Department, the Monroeville Police Department, and the McKees Rocks Police Department.
Pitkin man pleads guilty to stealing from Fort Polk consumer goods storeRead the Press Release
LAKE CHARLES, La. – United States Attorney Stephanie A. Finley announced today that a Pitkin man pleaded guilty to stealing more than $13,000 from the Fort Polk Post Exchange.
Darian Chad Pottmeyer, 40, of Pitkin, La., pleaded guilty before U.S. District Judge Patricia Minaldi to one count of theft of government money. According to the guilty plea, Pottmeyer, who was a cashier at the Post Exchange store on the Fort Polk military base, stole more than $13,000 from January 2014 to November 2014. An investigation using surveillance video at the store showed Pottmeyer placing money into his register without logging the sale. Pottmeyer would then, at opportune times, steal the money from the register. After being confronted about the thefts, Pottmeyer admitted to stealing at least $60 per day during the scheme.
Pottmeyer faces up to 10 years in prison, three years supervised release, a $250,000 fine and restitution. A sentencing date of December 10, 2015 was set.
The U.S. Army Criminal Command investigated the case. Assistant U.S. Attorney David C. Joseph is prosecuting the case.
Peterborough Man Pleads Guilty to Failure to Register as A Sex OffenderRead the Press Release
CONCORD, NEW HAMPSHIRE - William Townley, 56, of Peterborough, New Hampshire, appeared in United States District Court today and entered a guilty plea to one count of failure to register as a sex offender in violation of federal law, announced Acting United States Attorney Donald Feith.
Townley was convicted of felonious sexual assault on a victim under thirteen in 1996 and is required to register for life under the Sex Offender Registration and Notification Act. In January, 2014, Townley left New Hampshire and traveled to New Jersey and Indiana. He remained in Indiana from March, 2014 through September, 2014 and knowingly failed to register as a sex offender in Indiana or any other state and knowingly failed to update his registration in New Hampshire. Townley faces a maximum sentence of ten years in prison and criminal fines of up to $250,000. Sentencing is presently scheduled for December 22, 2015.
This case was investigated by the Peterborough Police Department and the United States Marshals Service. The case is being prosecuted by Assistant United States Attorney Georgiana Konesky.
Owner of Freight Shipping Company Sentenced to 41 Months in Prison for Scheme to Defraud Pharmaceutical Company Out of $3 MillionRead the Press Release
NEWARK N.J. – The owner of a Morris County, New Jersey, freight shipping company was sentenced today to 41 months in prison for billing a medical devices and pharmaceutical company more than $3 million for services that were never provided, U.S. Attorney Paul J. Fishman announced.
Courtney P. Shorter, 48, of Roselle, New Jersey, and Memphis, Tennessee, previously pleaded guilty before U.S. District Judge William H. Walls in Newark federal court to an information charging him with one count of mail fraud.
According to the documents filed in this case and statements made in court:
Shorter owned Sam Shorter & Son Delivery Service LLC, a freight shipping and trucking company in Long Valley, New Jersey. Company B manufactured and supplied insulated containers to Company A, a medical devices, pharmaceutical and consumer packaged goods manufacturer headquartered in New Brunswick, New Jersey. Company C was a freight invoice processing company headquartered in Fort Myers, Florida, that Company A used to pay trucking companies.
From 2008 through April 2010, Shorter charged Company A for transporting shipments from Company B to Company A when, in fact, those shipments were never made. Shorter admitted that he and others sent Company C more than 1,725 fraudulent invoices for work that was never actually performed. As a result of the invoices, Shorter received $3,039,840 from Company C, which he later deposited into bank accounts he controlled and used for personal expenses, including more than $120,000 in jewelry.
In addition to the prison term, Judge Walls sentenced Shorter to two years of supervised release and ordered to pay $3,039,840 in restitution.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Richard M. Frankel, with the investigation leading to the today’s sentencing.
The government is represented by Assistant U.S. Attorney Lakshmi Srinivasan Herman of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
Defense Counsel: Randy P. Davenport Esq. and Steven Brister Esq., Union, New Jersey
New Jersey Transit Employee Sentenced to Three Years in Prison for Extorting Money from VendorsRead the Press Release
NEWARK, N.J. – A New Jersey Transit employee was sentenced today to 36 months in prison for obtaining money from New Jersey Transit vendors to use his official authority and influence to help them get work with New Jersey Transit, U.S. Attorney Paul J. Fishman announced.
William Talerico, 56, of Beachwood, New Jersey, previously pleaded guilty before U.S. District Judge William H. Walls to an information charging one count of affecting commerce by extortion under color of official right. Judge Walls imposed the sentence today in Newark federal court.
According to documents in this case and statements made in court:
From at least around January 2006 to April 2012, Talerico served as a supervisor of stations responsible for overseeing the maintenance and custodial functions for certain New Jersey Transit facilities, including stations on New Jersey Transit’s North Jersey Coast Line and Northeast Corridor.
During this time period, Talerico agreed to accept and accepted corrupt payments in cash from numerous New Jersey Transit vendors. In exchange, Talerico agreed to, and did, exercise official authority and influence to assist the New Jersey Transit vendors with securing work from New Jersey Transit. In addition, Talerico acted as an intermediary through which corrupt payments were given to a New Jersey Transit supervisor. Talerico received more than $70,000, for himself and the supervisor, in corrupt payments of cash and other items of value from these New Jersey Transit vendors.
In addition to the prison term, Judge Walls sentenced Talerico to three years of supervised release and ordered him to pay $54,600 in restitution.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Richard M. Frankel; and the N.J. State Police, under the direction of Col. Joseph R. Fuentes, for their work in the investigation leading to today’s sentencing. He also thanked the N.J. Attorney General’s Office, under the direction of Acting Attorney General John Hoffman and Elie Honig, Director of the N.J. Division of Criminal Justice, for their work in this investigation.
The government is represented by Assistant U.S. Attorney Mark McCarren of the U.S. Attorney’s Office Special Prosecutions Division in Newark, and Special Assistant U.S. Attorney Michael A. Monahan, the Chief of the Financial and Computer Crimes Bureau, Division of Criminal Justice, in the N.J. Attorney General’s Office.
Defense counsel: Peter R. Willis Esq., Jersey City, New Jersey
Nashville Woman Pleads Guilty to Witness Tampering ChargesRead the Press Release
Laquanda Boyce, age 33, of Nashville pleaded guilty on September 4, 2015, to conspiring with Michael Calloway aka Oso, 20, also of Nashville, to tamper with a witness, announced United States Attorney David Rivera. Boyce and Calloway were indicted in May of this year after trying to pay a witness to change his testimony.
“Witness tampering, whether by bribery as in this case, or through violence as in other cases, are very serious offenses,” said U.S. Attorney David Rivera. “These crimes strike at the heart of our criminal justice system, which depends upon truthful testimony of the witnesses.” As shown by this case, anyone who engages in such conduct can be subjected to substantially more prison time than the original offense.”
According to the statement of facts, on the morning of April 12, 2015, Boyce and Calloway were assaulting a woman at the J.C. Napier housing development when another person intervened. The witness tried to protect the woman as Boyce and Calloway continued the assault and cut hair from her head. Later in the afternoon, Boyce and Calloway were walking together through the housing development and Calloway was carrying a gun in his hand. Upon seeing the witness again, Calloway fired eight or nine shots at him, striking him once in the leg. The gunshot victim was treated at Vanderbilt Hospital and subsequently identified Calloway as the shooter.
Calloway was arrested the following day and learned that he would likely face federal firearms charges. He and Boyce then devised a scheme to pay the witness $1200 in exchange for his refusal to testify or for testifying that he had mistakenly identified Calloway as the person who had shot him. As part of the plan, Boyce coordinated with others to arrange the payments- $600 to be paid after providing the false testimony and $600 to be paid upon Calloway’s release from jail.
U.S. District Judge Todd Campbell scheduled Boyce’s sentencing for January 4, 2016.
The original charge against Calloway of being a felon in possession of ammunition carried a maximum penalty of ten years in prison. The additional witness tampering charges carry up to twenty years in prison for each charge. Calloway is set for trial on October 6, 2015, and is presumed innocent unless and until proven guilty in a court of law.
These cases were investigated by the Metropolitan Nashville Police Department Gang Unit and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. The case is being prosecuted by Assistant United States Attorney Sunny A.M. Koshy.
Moore County, Texas, Man Sentenced on Federal Obscenity ConvictionRead the Press Release
AMARILLO, Texas — Bassam Arif Al Zarkani, 33, of Dumas, Texas, was sentenced this morning by U.S. District Judge Mary Lou Robinson to 27 months in federal prison, following his guilty plea in July 2015 to one count of attempted transfer of obscene material to a minor, announced U.S. Attorney John Parker of the Northern District of Texas.
Al Zarkani has been in custody since his arrest in April 2015.
According to documents filed in the case, on approximately April 14, 2015, Al Zarkani sent a “friend request” to an undercover officer’s Facebook account, and the undercover officer accepted that friend request. Al Zarkani and the undercover officer exchanged messages and in response to Al Zarkani’s inquiry, the undercover officer responded, “single…no kids thank god…im 15.”
The conversation turned sexual in nature and Al Zarkani sent the undercover officer a sexually explicit photo of himself, and for almost two weeks, Al Zarkani and the undercover officer, whom Al Zarkani believed was a 15-year-old female, sent private messages to each other through Facebook. During the conversations, Al Zarkani warned the undercover officer to keep him a secret from her dad and not tell anyone about him until she is 18 years old. On April 28, 2015, a meeting site was established, and Al Zarkani traveled from Dumas to Amarillo, Texas, to meet the girl. He was arrested when he arrived at the meeting location.
The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the Amarillo Police Department and the Texas Department of Public Safety investigated. Assistant U.S. Attorney Joshua Frausto prosecuted.
# # #
Madera Man Sentenced to 8 Years in Prison for Distributing Child PornographyRead the Press Release
FRESNO, Calif. — Ernest Garza Reyes, 32, of Madera, was sentenced today by United States District Judge Anthony W. Ishii to eight years in prison for distributing child pornography, United States Attorney Benjamin B. Wagner announced.
According to court documents, from July 2, 2011, through December 1, 2011, Reyes sent and received over 200 email messages that contained over 2,800 images depicting minors engaged in sexually explicit conduct. The images also involved the portrayal of sadistic and masochistic violence, and included depictions of prepubescent minors. Reyes was charged with receiving or distributing child pornography on May 9, 2013, and pleaded guilty to this charge on September 8, 2014.
This case was the product of an investigation by the Central California Internet Crimes Against Children Task force, the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), and the Fresno County Sheriff’s Office. Assistant United States Attorney Brian W. Enos prosecuted the case.
“Today’s sentencing is another victory in the fight against the sexual exploitation of children,” said Ray Greenlee, assistant special agent in charge for HSI Sacramento. “Homeland Security Investigations works tirelessly with its law enforcement counterparts, including the Fresno County Sheriff’s Department, to identify those who prey on innocent children and hold them accountable for their actions.”
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about Internet safety education.
Lincoln County Man Sentenced to 10 Years in Prison for Possession of Child PornographyRead the Press Release
EUGENE, Ore. – Troy Wooley, 48, of Newport, Oregon, pled guilty to possession of child pornography and was sentenced today by Chief U. S. District Judge Ann Aiken to 120 months in prison, to be followed by a lifetime term of supervised release.
The federal charges were brought after the Newport Police Department received a tip that computer equipment belonging to Wooley contained child pornography. According to the prosecutor, Wooley had an extensive criminal history that included prior convictions for sex abuse and possession of child pornography. He was in possession of approximately 86 images of child pornography.
This case was investigated by the Newport Police Department, the Albany Police Department and the FBI. This case was prosecuted by Assistant U.S. Attorney Amy Potter.
Kingsville Couple Sentenced for $664,000 Bank Fraud for Lee's Summit Construction ProjectRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Kingsville, Mo., husband and wife were sentenced in federal court today for a $664,000 bank fraud scheme related to his work on a Lee’s Summit, Mo., subdivision.
Dennis R. Key, 52, and his wife, Michal Ann Key, 49, both originally of Kingsville, were sentenced by U.S. Chief District Judge Greg Kays. Dennis Key was sentenced to three years and five months in federal prison without parole. Michal Key was sentenced to 18 months in federal prison without parole. The court also ordered the Keys to pay $664,393 in restitution to their victim.
On Sept. 25, 2014, the Keys pleaded guilty to bank fraud. The Keys admitted that they engaged in a four-year-long bank fraud scheme from August 2006 to November 2009. They stole $664,393 from Dennis Key’s longtime friend by double-billing him for work building a house, and by concealing that double-billing through hidden fees, shell companies and bank accounts, and by signing false and fictitious names to checks.
Dennis Key was the owner of DM & Associates, LLC, a land surveying and engineering consulting business in the Kansas City area. Michal Key did administrative and clerical work for the business, including bookkeeping, paying bills and writing checks.
In January and February 2005, Dennis Key entered into two contracts with his friend, under which he would be paid for surveying and engineering in relation to developing part of a subdivision in Lee’s Summit, and for project management/general contracting in building a house for his friend in that subdivision.
In August 2006, Dennis Key arranged for JM Contractors to act as general contractor for the construction work and to subcontract work to be performed. He instructed JM Contractors to add an extra 15 percent to its fee, which would be paid to Dennis Key. Dennis Key also instructed JM Contractors to conceal the mark-up by hiding the fee in each line item on the bills. Through this contractor, Dennis Key received a $97,500 kickback.
Key also lied to his friend by telling him JM Contracting was a subcontractor, not a general contractor. His friend also lost the $203,361 that he paid JM Contracting for work he had already paid Dennis Key to do.
The Keys also created various shell companies with names similar to the subcontractors working on the house. When they received the real bills from the subcontractors, they prepared false inflated bills and invoices in the names of the shell companies and submitted those for payment. When they received payment, they deposited the funds into the bank accounts of their shell companies. They transferred the funds to their personal bank account, paid the actual subcontractors the amount owed and kept the difference.
This case was prosecuted by Assistant U.S. Attorney Kathleen D. Mahoney. It was investigated by the U.S. Secret Service and the Lee’s Summit, Mo., Police Department.
KC Man Sentenced for Transporting an Individual for ProstitutionRead 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 transporting an individual across states lines for prostitution.
Milton Charles Wilson, also known as “Barbwire,” 59, of Kansas City, was sentenced by U.S. District Judge Gary A. Fenner to 10 years in federal prison without parole.
On April 1, 2015, Wilson and co-defendant Kayla Pinkerton, also known as “Foxy,” 20, of Lee’s Summit, Mo., pleaded guilty to transporting an individual across state lines to engage in prostitution in Kansas in December 2013. Pinkerton was sentenced on July 27, 2015, to 16 months in prison.
Wilson admitted that he advertised the victim for prostitution on Backpage.com and paid for a hotel room at the American Inn in North Kansas City, Mo. Wilson transported Pinkerton and the victim to various locations in Missouri and Kansas, including at least two trips to Overland Park, Kan., for the purpose of prostitution.
This case was prosecuted by Assistant U.S. Attorney Patrick D. Daly. It was investigated by the Kansas City, Mo., Police Department, the FBI, U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Justice Department Requires General Electric to Divest Aftermarket Business in Order to Complete Alstom PurchaseRead the Press Release
The Department of Justice announced today that it will require General Electric Company (GE) to divest Alstom S.A.’s subsidiary Power Systems Mfg. LLC (PSM) in order for GE to proceed with its proposed approximately $13.8 billion acquisition of Alstom.
The Antitrust Division filed a civil antitrust lawsuit in the U.S. District Court of the District of Columbia to block the proposed transaction. At the same time, the department filed a proposed settlement that, if approved by the court, would resolve the department’s competitive concerns alleged in the lawsuit.
“The acquisition as originally proposed would have eliminated General Electric’s primary competitor in the supply of aftermarket parts and services for GE gas turbines in the United States,” said Principal Deputy Assistant Attorney General Renata B. Hesse of the Antitrust Division. “We appreciate the close cooperation of the European Commission, which greatly facilitated our investigation and helped formulate remedies that will preserve competition in the United States and internationally.”
The European Commission announced today that in order to address its competitive concerns with the acquisition, it will require GE to divest a package of Alstom assets relating to the development and manufacture of large gas turbines widely used in Europe, including PSM. The department’s Antitrust Division and the European Commission cooperated closely throughout the course of their respective investigations, with frequent contact between the agencies.
According to the department’s complaint, only three competitors, including GE and PSM, develop, manufacture and sell new aftermarket parts to repair and service GE 7FA gas turbines installed in the United States. PSM’s entry in 1998 into the aftermarket parts and service market led to widespread price decreases, including a drop of 60 to 70 percent in the price of replacement parts for GE 7FA gas turbines. In addition, PSM’s entry led to the development of many new parts that have improved the performance of GE 7FA gas turbines. The loss of PSM as an independent competitor would have harmed owners of GE turbines and ultimately U.S. consumers.
The proposed divestiture will remedy this loss of competition. Under the terms of the proposed consent decree, GE must divest Alstom’s PSM subsidiary to Ansaldo Energia S.P.A. (Ansaldo) or an alternative, independent buyer approved by the United States.
GE, based in Connecticut, is a global manufacturing, technology and services company. GE’s subsidiary, GE Power and Water, provides power generation, energy delivery and water process technologies in a number of areas in the energy industry. In 2014, GE’s revenues from aftermarket parts and service for GE 7FA gas turbines were approximately $730 million.
PSM, headquartered in Florida, is a wholly owned subsidiary of Alstom, a French corporation. PSM provides aftermarket parts and services for a variety of turbine engines, including the GE 7FA model. In 2014, PSM’s U.S. revenues for aftermarket parts and service for GE 7FA gas turbines were approximately $90 million.
As required by the Tunney Act, the proposed consent decree, along with the department’s competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement within 60 days of its publication to Maribeth Petrizzi, Chief, Litigation II Section, Antitrust Division, Department of Justice, 450 Fifth Street, N.W., Suite 8700, Washington, D.C. 20530. At the conclusion of the 60-day comment period, the court may enter the final judgment upon a finding that it serves the public interest.
GE Alstom Complaint (426.5 KB)
GE Alstom PFJ (1.52 MB)
GE Alstom CIS (1.01 MB)
Justice Department Reaches Proposed ADA Settlement Agreement on Oregon's Developmental Disabilities SystemRead the Press Release
The U.S. Justice Department announced today, along with private plaintiffs, that it has entered into a proposed settlement agreement with the state of Oregon that will resolve violations of the Americans with Disabilities Act (ADA) and will impact approximately 7,000 Oregonians with intellectual and developmental disabilities (I/DD) who can and want to work in typical employment settings in the community. The private plaintiffs were represented by the Center for Public Representation, Disability Rights Oregon and the law firms of Miller Nash Graham & Dunn LLP and Perkins Coie LLP. The proposed agreement resolves a class action lawsuit by private plaintiffs in which the department intervened. The parties’ proposed settlement agreement must still be approved by U.S. Magistrate Judge Janice Stewart of the District of Oregon, who is presiding over the lawsuit. The agreement will be filed with the court in the coming weeks.
The department alleged that Oregon’s employment services system unnecessarily placed people with I/DD in, or at risk of entering, sheltered workshops instead of in integrated jobs in the community, in violation of the ADA. As interpreted by the Supreme Court’s landmark decision in Olmstead v. L.C., the ADA affords individuals with disabilities the right to receive services in the most integrated setting appropriate to their needs. Sheltered workshops are segregated facilities that exclusively or primarily employ people with disabilities. They are usually large, institutional facilities in which people with disabilities have little or no contact with non-disabled persons besides paid staff. People with I/DD in sheltered workshops typically earn wages that are well below minimum wage, sometimes pennies per hour. By contrast, supported employment services assist people with I/DD to prepare for, gain and succeed in integrated employment at competitive wages. Approximately 450,000 people with I/DD across the country spend their days in segregated sheltered workshops and facility-based day programs. Approximately 1,900 Oregonians with disabilities currently receive services in sheltered workshops. Since the initiation of the lawsuit, approximately 3,900 Oregonians with disabilities have received services in sheltered workshops, and historically hundreds of students have transitioned each year from Oregon public schools to sheltered workshops.
As a result of the proposed settlement, over the next seven years, 1,115 working-age adults with I/DD who are currently being served in segregated sheltered workshops will have opportunities to work in real jobs at competitive wages. Additionally, at least 4,900 youth ages 14 to 24 years old will receive supported employment services designed to assist them to choose, prepare for, get and keep work in a typical work setting. Half of the youth who receive employment services will receive, at a minimum, an individual plan for employment through the state’s Office of Vocational Rehabilitation Services.
The proposed settlement resolves the first class action lawsuit in the nation to challenge a state funded and administered employment service system, including sheltered workshops, as a violation of the ADA’s integration mandate. The class action, Lane v. Kitzhaber (since renamed Lane v. Brown), was filed in January 2012, by eight named individuals and United Cerebral Palsy of Oregon and Southwest Washington, on behalf of themselves and other individuals with I/DD who are in Oregon sheltered workshops or have been referred to sheltered workshops. In March 2013, the Department of Justice moved to intervene in the lawsuit, seeking to vindicate the rights of thousands of individuals with I/DD across Oregon. The department’s claims included that Oregon violated the ADA by unnecessarily segregating adults with I/DD in sheltered workshops and by placing Oregon youth with I/DD at unnecessary risk of segregation in sheltered workshops.
The proposed agreement recognizes that Oregon has made substantial progress in providing employment services to and improving employment outcomes for individuals with I/DD since the filing of the plaintiffs’ complaint and the department’s complaint-in-intervention. In 2013 and 2015, respectively, Oregon’s then Governor John Kitzhaber issued Oregon Executive Orders 13-04 and 15-01 and the state developed Integrated Employment Plans committing to implement strategies for the Oregon Department of Human Services and Oregon Department of Education to improve Oregon’s employment service system for individuals with I/DD. These plans call upon the state to reduce its reliance on segregated sheltered workshops and increase its investment in supported employment services.
“Work is a fundamental aspect of most people's lives,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division. “People with disabilities deserve opportunities to work alongside their friends, peers, and neighbors without disabilities and to earn fair wages. We are pleased that the state of Oregon has fully embraced integrated employment services for people with intellectual and developmental disabilities and we look forward to the new ways people with intellectual and developmental disabilities will be able to contribute to their communities as this proposed agreement is implemented.”
“This proposed agreement not only realizes the requirements of federal law, but just as importantly, it embraces policies and practices to support both youth and adult community members with disabilities to successfully interact and work alongside non-disabled Oregonians,” said Acting U.S. Attorney Billy J. Williams of the District of Oregon. “The implementation of the agreement will bring all of our communities together in recognizing the work capabilities of individuals with intellectual and developmental disabilities.”
The Civil Rights Division enforces the ADA, which authorizes the Attorney General to investigate whether a state is serving individuals in the most integrated settings appropriate to his or her needs. Please visit www.ada.gov/olmstead to learn more about the division’s ADA Olmstead enforcement efforts and www.justice.gov/crt to learn more about the other laws enforced by the Justice Department’s Civil Rights Division.
Indictment Charges 3 Former Nomura RMBS Traders with Multiple Fraud and Conspiracy OffensesRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, Christy Goldsmith Romero, the Special Inspector General for the Troubled Asset Relief Program, Patricia M. Ferrick, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, Scott S. Dahl, the Inspector General for the Department of Labor, Office of Inspector General, and Steven Perez, Special Agent in Charge of the Federal Housing Finance Agency Office of Inspector General today announced that a federal grand jury in New Haven has returned a 10-count indictment charging three former New York-based bond traders for Nomura Securities International, ROSS SHAPIRO, 41, MICHAEL GRAMINS, 33, and TYLER PETERS, 32, all of New York, New York, with conspiracy and fraud offenses.
The indictment was returned on September 3 and unsealed today. SHAPIRO, GRAMINS and PETERS are scheduled to be arraigned on September 10 at 10 a.m. before U.S. Magistrate Judge Donna F. Martinez in Hartford.
As alleged in the indictment, SHAPIRO, GRAMINS, and PETERS supervised the Residential Mortgage Backed Securities (“RMBS”) Desk at Nomura Securities International (“Nomura”) in New York. SHAPIRO was the Managing Director who oversaw all of Nomura’s trading in RMBS, GRAMINS was the Executive Director of the RMBS Desk and principally oversaw Nomura’s trading of bonds composed of sub-prime and option ARM loans, and PETERS was the senior-most Vice President of the RMBS Desk and focused primarily on Nomura’s trading of bonds composed of prime and alt-A loans.
The indictment alleges that SHAPIRO, GRAMINS and PETERS engaged in a conspiracy to defraud customers of Nomura by fraudulently inflating the purchase price at which Nomura could buy a RMBS bond to induce their victim-customers to pay a higher price for the bond, and by fraudulently deflating the price at which Nomura could sell a RMBS bond to induce their victim-customers to sell bonds at cheaper prices, causing Nomura and the three defendants to profit illegally.
According to the indictment, the three co-conspirators trained their subordinates to lie to customers, provided them with the language to use in deceiving customers, and encouraged them to engage in the practice. In one instance, one of the defendants’ subordinate traders told a salesperson that he “lied” about the price of bond and “marked up 2 pts,” to which the salesperson responded “haha sick . . . well played.”
The defendants are also alleged to have created fictitious third parties in an effort to increase their profits, and colluded with at least one outside client to deceptively broker trades on their behalf. In one instance, an investment advisor for another firm concocted a false story with SHAPIRO to tell to customers. According to the indictment, he wrote to SHAPIRO asking, “when did I buy [the bond] and at what price.”
The victims of this scheme include funds from around the world, retirement plan providers and a Trouble Asset Relief Program (TARP) fund manager.
“This indictment alleges that, for several years, these three defendants handsomely profited by repeatedly lying to Nomura’s customers in violation of federal law,” said U.S. Attorney Deirdre M. Daly. “The victims of this alleged conspiracy include numerous funds, retirement plan providers and taxpayer-provided bailout funds that helped our nation to recover from the 2008 financial crisis. Our investigation into corrupt practices in the RMBS and other financial markets continues. I commend SIGTARP, the FBI, the U.S. Department of Labor’s Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, and the Federal Housing Finance Agency Office of Inspector General for their outstanding investigative work in this area.”
“The Government bought residential mortgage backed securities through TARP’s Public-Private Investment Program (PPIP) to unlock frozen credit markets during the financial crisis, not to become a victim of this criminal scheme by these Nomura traders, and to overpay for securities,” said Special Inspector General for TARP (SIGTARP) Christy Goldsmith Romero “SIGTARP’s investigation with our law enforcement partners revealed what is charged today – that Nomura’s most senior and highly compensated traders on the RMBS trading desk, Ross Shapiro, Michael Gramins and Tyler Peters, all former Lehman Brothers employees, allegedly conspired to overcharge their customers, which included an investment firm who was managing the government’s bailout money in a PPIP fund. The defendants’ alleged scheme was simple: To drive up profits they lied to and deceived their victims. They are alleged to have overstated the price Nomura paid. They are also alleged to have created fictitious third-party sellers when the RMBS sat in Nomura’s inventory. And they are alleged to have bragged about it to each other. All those on Wall Street who engaged in criminal schemes related to TARP programs are warned that SIGTARP will work with our law enforcement partners to uncover and stop bailout-related crime, and that will lead to prosecution. I want to commend U.S. Attorney Deirdre Daly for her steadfast commitment to fighting TARP-related crime.”
“The indictment alleges that Shapiro, Gramins and Peters orchestrated a scheme of fraud and deceit to manipulate the bond market in their own favor resulting in losses that were passed on to investors,” said FBI Special Agent in Charge Patricia M. Ferrick. “Self-dealing and special treatment of insiders have no place in American financial markets. The special agents of the FBI and our law enforcement partners will continue their work to ensure that the U.S. securities markets remain a level playing field for all investors.”
“When investment professionals put profits before prudence and the law, it creates a dangerous environment for investors and threatens the integrity of our financial markets,” said Steven Perez, Special Agent in Charge of the Federal Housing Finance Agency Office of Inspector General. “Today’s announcement signals our ongoing commitment to working with our law enforcement partners to identify, investigate and prosecute corrupt practices in the Residential Mortgage Backed Securities arena and level the playing field for the investing public.”
The indictment charges SHAPIRO, GRAMINS and PETERS with one count of conspiracy, an offense that carries a maximum term of imprisonment of five years, two counts of securities fraud, an offense that carries a maximum term of imprisonment of 20 years on each count, and seven counts of wire fraud, an offense that carries a maximum term of imprisonment of 20 years on each count.
In a parallel action, the Securities and Exchange Commission today announced related civil fraud charges against SHAPIRO, GRAMINS and PETERS.
U.S. Attorney Daly stressed that an indictment is not evidence of guilt. Charges are only allegations, and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
The case has been assigned to U.S. District Judge Robert N. Chatigny in Hartford.
This matter is being investigated by the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), the Federal Bureau of Investigation, the U.S. Department of Labor’s Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, and the Federal Housing Finance Agency Office of Inspector General.
The case is being prosecuted by Assistant U.S. Attorneys Liam Brennan and Heather Cherry.
Today’s announcement is part of the ongoing efforts of President Obama’s Financial Fraud Enforcement Task Force’s Residential Mortgage-Backed Securities (RMBS) Working Group, a federal and state law enforcement effort focused on investigating fraud and abuse in the RMBS market that helped lead to the 2008 financial crisis and in the federal government’s bailout. The RMBS Working Group brings together attorneys, investigators, analysts and staff from dozens of state and federal agencies including the Department of Justice, U.S. Attorneys’ Offices, the FBI, the Securities and Exchange Commission (SEC), the Department of Housing and Urban Development (HUD), HUD’s Office of Inspector General, the FHFA-OIG, the Office of the Special Inspector General for the Troubled Asset Relief Program, the Federal Reserve Board’s Office of Inspector General, the Recovery Accountability and Transparency Board, the Financial Crimes Enforcement Network, and state Attorneys General offices around the country.
The RMBS Working Group is led by Associate Attorney General Stuart Delery, and co-chaired by Assistant Attorney General for the Criminal Division Leslie R. Caldwell, Principal Deputy Assistant Attorney General for the Civil Division Benjamin Mizer, U.S. Securities and Exchange Commission Director of Enforcement Andrew Ceresney, U.S. Attorney for the District of Colorado John Walsh and New York Attorney General Eric T. Schneiderman.
For more information about the RMBS Working Group and the Financial Fraud Enforcement Task Force, which is chaired by Attorney General Loretta Lynch, visit: www.stopfraud.gov.
Houston Woman Convicted of Producing and Distributing Animal Crush VideosRead the Press Release
HOUSTON – A 24-year-old woman from Houston has been convicted of creating and distributing videos depicting the torture and killing of puppies, chickens and kittens, announced United States Attorney Kenneth Magidson. Ashley Nicole Richards entered a guilty plea today, admitting she produced and distributed what is referred to as “animal crush videos.”
People For the Ethical Treatment of Animals (PETA) defines the “crush” fetish as a cruel and illegal genre of pornography in which women are videotaped or photographed mutilating small animals for the sexual gratification of viewers. In crush fetish materials, women are depicted, usually barefoot or in high heels, stepping on (or crushing), torturing and killing different species of animals, ranging from crawfish, crabs and insects to rodents, rabbits, kittens, puppies, cats, dogs and other mammals.
Under federal law, it is illegal to depict - via photograph, motion-picture film, video, digital recording or electronic image - actual conduct in which one or more living non-human mammals, birds, reptiles or amphibians is intentionally crushed, burned, drowned, suffocated, impaled or otherwise subjected to serious bodily injury, and is obscene.
This is the first known case to be indicted in federal court since the statute was amended in 2010.
Richards has admitted to creating and distributing videos that involve puppies, chickens and kittens being tortured and killed. The videos are titled “puppy1,” “puppy 2,” “whitechick1,” “whitechick2,” “whitechick3,” “blackluvsample,” “adammeetseve” and “adammeetseve2” and were created at varying times between February 2010 and August 2012. In the “puppy2” video, which is more than 13 minutes in length, Richards is seen torturing and killing a blue Pit Bull-mix puppy in a kitchen. The defenseless dog’s mouth is closed with duct tape and he struggles as Richards strikes the dog numerous times with a meat cleaver. In the video, Richards chops off one of the puppy’s paws, then hacks at his head and neck. Richards is later seen severing the dog’s head and urinating on its body. In another video, described in court today, Richards steps on a cat’s eye with heel of her shoe.
Previous court records also indicated that during the videos, Richards is often scantily clad and wearing a Mardi Gras-type mask. As she tortured the animals, she engaged in sexually charged dialogue meant to arouse the viewer.
Authorities were alerted to the videos following an inquiry from PETA.
Richards was originally arrested on state charges on Aug. 15, 2012. A federal grand jury returned an indictment Nov. 28, 2012, and she was transferred to federal custody. However, the crush video charges were later dismissed on what the court cited as constitutionality issues. The government appealed that decision to the 5th Circuit Court of Appeals in New Orleans which subsequently overturned the decision of the District Court. The defense then filed a petition for a writ of certiorari to the U.S. Supreme Court challenging the 5th Circuit’s ruling. The U.S. Supreme Court denied that petition and remanded the case back to the District Court for prosecution.
Today, Richards pleaded guilty to all five counts as charged - four counts of producing and one count of distribution of the animal crush videos which were obscene in nature. U.S. District Judge Sim Lake accepted the guilty pleas and has set sentencing for Dec. 10, 2015. At that time, Richards faces up to seven years in federal prison on each count of conviction as well as possible $250,000 fine.
Richards also pleaded guilty to three charges in state court stemming from the same conduct and was sentenced to 10 years in prison.
The Houston Police Department originally investigated the matter and worked in conjunction with the Houston Office of the FBI. Assistant U.S. Attorney Sherri L. Zack is prosecuting the case, while trial attorney John Pellettieri of the Department of Justice’s Criminal Division handled the appeal.Houston Woman Convicted of Producing and Distributing Animal Crush VideosRead the Press Release
Ashley Nicole Richards 24, of Houston, Texas, has been convicted of creating and distributing videos depicting the torture and killing of puppies, chickens and kittens, announced U.S. Attorney Kenneth Magidson for the Southern District of Texas. Richards entered a guilty plea today, admitting she produced and distributed what is referred to as “animal crush videos.”
People for the Ethical Treatment of Animals (PETA) defines the “crush” fetish as a cruel and illegal genre of pornography in which women are videotaped or photographed mutilating small animals for the sexual gratification of viewers. In crush fetish materials, women are depicted, usually barefoot or in high heels, stepping on (or crushing), torturing and killing different species of animals, ranging from crawfish, crabs and insects to rodents, rabbits, kittens, puppies, cats, dogs and other mammals.
Under federal law it is illegal to depict - via photograph, motion-picture film, video, digital recording or electronic image - actual conduct in which one or more living non-human mammals, birds, reptiles or amphibians is intentionally crushed, burned, drowned, suffocated, impaled or otherwise subjected to serious bodily injury, and is obscene.
This is the first known case to be indicted in federal court since the statute was amended in 2010.
Richards has admitted to creating and distributing videos that involve puppies, chickens and kittens being tortured and killed. The videos are titled “puppy1,” “puppy 2,” “whitechick1,” “whitechick2,” “whitechick3,” “blackluvsample,” “adammeetseve” and “adammeetseve2” and were created at varying times between February 2010 and August 2012. In the “puppy2” video, which is more than 13 minutes in length, Richards is seen torturing and killing a blue Pit Bull-mix puppy in a kitchen. The defenseless dog’s mouth is closed with duct tape and he struggles as Richards strikes the dog numerous times with a meat cleaver. In the video, Richards chops off one of the puppy’s paws, then hacks at his head and neck. Richards is later seen severing the dog’s head and urinating on its body. In another video, described in court today, Richards steps on a cat’s eye with heel of her shoe.
Previous court records also indicated that during the videos, Richards is often scantily clad and wearing a Mardi Gras-type mask. As she tortured the animals, she engaged in sexually charged dialogue meant to arouse the viewer.
Authorities were alerted to the videos following an inquiry from PETA.
Richards was originally arrested on state charges on Aug. 15, 2012. A federal grand jury returned an indictment Nov. 28, 2012, and she was transferred to federal custody. However, the crush video charges were later dismissed on what the court cited as constitutionality issues. The government appealed that decision to the 5th Circuit Court of Appeals in New Orleans which subsequently overturned the decision of the District Court. The defense then filed a petition for a writ of certiorari to the U.S. Supreme Court challenging the 5th Circuit’s ruling. The Supreme Court denied that petition and remanded the case back to the District Court for prosecution.
Today, Richards pleaded guilty to all five counts as charged, four counts of producing and one count of distribution of the animal crush videos which were obscene in nature. U.S. District Judge Sim Lake accepted the guilty pleas and has set sentencing for December 10. At that time, Richards faces up to seven years in federal prison on each count of conviction as well as possible $250,000 fine.
Richards also pleaded guilty to three charges in state court stemming from the same conduct and was sentenced to ten years in prison.
The Houston Police Department originally investigated the matter and worked in conjunction with the Houston Office of the FBI. Assistant U.S. Attorney Sherri L. Zack is prosecuting the case, while trial attorney John Pellettieri of the Department of Justice’s Criminal Division handled the appeal.
Hazleton Man Sentenced to Prison in Stolen Identity Refund Fraud CaseRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Rafael Sanchez, age 51 of Hazleton, Pennsylvania, was sentenced today in federal court in Scranton, by United States District Judge James M. Munley, to serve 94 months in prison after pleading guilty in April of this year to conspiracy to submit false claims and aggravated identity theft.
Sanchez was also ordered to serve an additional 3 years under court supervision upon his release from prison and to pay $694,237 in restitution to the Internal Revenue Service.
According to U.S. Attorney Peter Smith, Sanchez owned and operated Sanchez Multi Service, a check-cashing, tax preparation and money transfer business in Hazleton. An Indictment returned by a federal grand jury last year alleged Sanchez and others used the identities of unknowing third parties to prepare and file fraudulent federal income tax returns. The Indictment also alleged that Sanchez deposited and cashed fraudulently obtained federal tax refund checks totaling hundreds of thousands of dollars.
Akeia Conner, Special Agent in Charge, Philadelphia Field Office stated, “The severity of today’s sentence sends a clear message to identity thieves who think they can defraud the United States Treasury. The Internal Revenue Service, Criminal Investigation, along with the United States Attorney’s Office and our fellow law enforcement partners, will work diligently to pursue those who seek to enrich themselves at the expense of the American taxpayer. The impact of identity theft on our taxpayers and our tax system is long lasting. The sentence imposed today tells identity thieves that the ramifications for their crime will also be long lasting.”
The investigation was conducted by the Scranton Office of the Internal Revenue Service, Criminal Investigation. The IRS received assistance in the investigation from the Department of Homeland Security, Homeland Security Investigations (HSI) and the Hazleton City Police Department. The case was prosecuted by Assistant United States Attorney William S. Houser.
# # #
Greenville Man Sentenced to 121 Months for RobberyRead the Press Release
GREENVILLE – United States Attorney Thomas G. Walker announced that today in federal court, Senior United States District Judge Malcolm J. Howard sentenced Markeith DEVON WILSON, 27, of Greenville, North Carolina, to 121 months imprisonment, followed by 5 years of supervised release and restitution.
WILSON was named in an Indictment filed on November 12, 2014, charging him with possession of a firearm by a felon, robbery affecting interstate commerce, and brandishing a firearm during the robbery. On January 6, 2015, WILSON pled guilty to the robbery and brandishing a firearm charges.
According to the investigation, on January 31, 2014, WILSON robbed employees of Popeye’s Chicken in Greenville, North Carolina. WILSON, armed with a shotgun, approached an employee taking the trash out of the business. As the employee re-entered the store, WILSON forced his way in and pointed the shotgun at the manager. WILSON pulled the trigger but the shotgun failed to discharge. WILSON stole $400 in cash from the business. When law enforcement arrived, the manager advised officers that the suspect had recently been in the business. The manager recognized the suspect, who was missing a front tooth and had a distinctive stutter. WILSON was subsequently identified in a line-up
Investigation of this case was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Greenville Police Department. Assistant United States Attorney Rudy E. Renfer represented the government.
Former Employee of U.S. Contractor in Afghanistan Pleads Guilty to Bribery and Structuring ConspiracyRead the Press Release
A former employee with International Relief and Development Inc. (IRD) pleaded guilty today to charges of bribery in connection with a federal program and conspiracy to structure financial transactions to avoid currency transaction reporting requirements, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division.
George E. Green, 57, of Carrollton Texas, pleaded guilty before U.S. Magistrate Judge Don D. Bush of the Eastern District of Texas. Sentencing will be scheduled at a later date before U.S. District Judge Marcia A. Crone of the Eastern District of Texas. The parties agreed to a stipulated sentence of 46 months in prison and a forfeiture of $51,000.
In connection with a cooperative agreement between the U.S. Agency for International Development (USAID) and IRD to strengthen economic stabilization and promote long-term agricultural development in specific areas in Afghanistan, Green served as IRD’s director of contracts, procurement and grants. According to admissions made in connection with his guilty plea, in March and April 2012, Green solicited and received a $51,000 bribe from a representative of an Afghan company that provided agriculture-related products and that sought subcontracts from IRD. Green also admitted that between May and August 2012, after he returned to Texas, he attempted to conceal the bribe proceeds by conspiring with others to make deposits of less than $10,000 each into his bank and credit card accounts to circumvent the financial institutions’ mandatory cash reporting requirements.
The case is being investigated by Special Inspector General for Afghanistan Reconstruction, the FBI and the USAID Office of Inspector General. This case is being prosecuted by Special Trial Attorney Mark H. Dubester and Trial Attorney Michael T. O’Neill of the Criminal Division’s Fraud Section.
Former Economic Development Employee Pleads Guilty to Receiving Child PornRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a former employee of the South Central Ozarks Council of Governments pleaded guilty in federal court today to receiving child pornography on his worksite computer.
Steven Gregary Reed, 37, of West Plains, Mo., pleaded guilty before U.S. District Judge M. Douglas Harpool to the charge contained in a Dec. 10, 2014, federal indictment.
At the time of the offense, Reed was employed as the coordinator of solid waste management with the South Central Ozarks Council of Governments, an economic development organization for seven counties in the south central region of Missouri (Douglas, Howell, Oregon, Ozark, Shannon, Texas, and Wright Counties), which is headquartered in Pomona, Mo.
A law enforcement officer with the Southwest Missouri Cyber Crime Task Force was investigating unlawful Internet usage and noticed that a certain computer had over 100 files of suspected child pornography. The officer continued to monitor the computer for several months and noticed the computer to be on a peer-to-peer file-sharing network on a regular basis, searching for child pornography. The computer was assigned to the South Central Ozarks Council of Governments.
On Oct. 29, 2014, law enforcement officers executed a search warrant at the office and determined that the desktop computer used by Reed was the computer identified in their investigation. Reed admitted to officers that he had watched child pornography the night before the execution of the search warrant. Reed viewed child pornography on a regular basis at work and home. Reed stated that he never downloaded child pornography at home but he did at work. He admitted to placing downloaded child pornography on a flash drive that he kept in his car. He added that he looked at child pornography on his work computer and often downloaded child pornography on his work computer.
Reed had approximately 131 movies and 126 graphic images of child pornography on his work computer.
Under federal statutes, Reed is subject to a mandatory minimum sentence of five years in federal prison without parole, up to a sentence of 20 years in federal prison without parole, plus a fine up to $250,000. Reed must forfeit to the government a laptop computer, a desktop computer and two flash drives that were used to commit the offense. Reed will be required under the federal Sex Offender Registration and Notification Act (SORNA) to register as a sex offender and keep the registration current in each of the jurisdictions where he resides, is employed and is a student. 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 Abram McGull, II. It was investigated by the Southwest Missouri Cyber Crimes Task Force, the FBI, the Missouri State Highway Patrol and the Howell County, Mo., Sheriff’s 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."
Former Contract Worker at National Records Center Pleads Guilty to Mutilating and Destroying Public RecordsRead the Press Release
St. Louis, MO – PETER PANOUZIS pled guilty to charges of mutilating and destroying United States Selective Service records of 50 or more individuals. The records are part of the National Archives deposited and held at the National Personnel Records Center in St. Louis.
Through a partnership with Ancestry.com, the National Personnel Records Center is in the process of digitizing World War II era Selective Service records, including Draft Registration Cards and their attachments. According to court documents, Panouzis was a contract worker hired by Ancestry.com as part of the National Archives’ Digitization Project Plan. As such, Panouzis had access to original World War II era Draft Registration Cards and original attachments to those Draft Registration Cards, archived at the National Personnel Records Center.
Instead of scanning and digitizing all of the attachments to individual Draft Registration Cards, Panouzis mutilated and destroyed some of the attachments. Specifically, on March 9 and March 11, 2015, Panouzis tore up the attachments rather than digitizing them. He then stuffed the torn pieces into his work gloves and discarded the gloves in bins and trash cans in his work area. On March 12, 2015, Panouzis made an off-site call to a National Archives and Records Administration (NARA) archives technician who was working at the facility, and asked the technician to do him a “favor” and discard a glove on his desk, empty a bin on his desk and empty a trash can near his work area. The glove, the bin and the trash can each contained archived records that the defendant had previously mutilated and destroyed. Upon finding the archived records mutilated and destroyed by Panouzis, the technician immediately contacted a NARA supervisor.
Panouzis, East Alton, Illinois, pled guilty to one count of destruction of public records before United States District Judge Carol E. Jackson. Sentencing has been set for December 10, 2015.
This charge carries a maximum penalty of three years in prison and/or fines up to $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the National Archives and Records Administration (NARA)-Office of Inspector General, Office of Investigations. Assistant United States Attorney Charles Birmingham is handling the case for the U.S. Attorney’s Office.
Former Chairman and CEO of Technology Start-Up Company KIT Digital, and Its Former Chief Financial Officer, Charged in Manhattan Federal CourtRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Diego Rodriguez, the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), and Philip R. Bartlett, Inspector-in-Charge of the New York Office of the U.S. Postal Inspection Service (“USPIS”), announced today the arrests of KALEIL ISAZA TUZMAN and ROBIN SMYTH. TUZMAN, the former chairman of the board of directors and chief executive officer of the technology start-up company KIT digital, was arrested yesterday in Colombia on market manipulation and accounting fraud charges. TUZMAN is being held in Colombia pending extradition proceedings. SMYTH, the former chief financial officer (“CFO”) of KIT digital, a publicly traded company that was based in New York, New York, and Prague, Czech Republic, was arrested today in Australia on accounting fraud charges. SMYTH is being held in Australia pending extradition proceedings.
Manhattan U.S. Attorney Preet Bharara said: “As alleged, Kaleil Isaza Tuzman and Robin Smyth engaged in an elaborate conspiracy to mislead investors and regulators about the financial health of the publicly traded company they oversaw. I want to thank the FBI and the Postal Inspection Service for helping to bring these two alleged fraudsters to justice.”
FBI Assistant Director Diego Rodriguez said: “As alleged, Tuzman and Smyth conspired to personally profit through market manipulation and accounting fraud in the tens of millions of dollars. Despite being as far away as Australia and Colombia, we seek to bring them to justice in the United States to face their accusers and alleged victims. The FBI will continue to work with U.S. Postal Inspection Service and our other partners in an effort at ensuring that our financial markets are legal, fair, and equitable.”
USPIS Inspector-in-Charge Philip R. Bartlett said: “These individuals took extraordinary steps to conceal their deceit from auditors and clients, creating instability in investor portfolios. Their actions highlight their arrogance and disregard for rules and regulations.”
According to the Indictment unsealed in Manhattan federal court[1], TUZMAN and SMYTH engaged in the following fraudulent schemes during their tenures as KIT digital’s Chairman and CEO, and CFO, respectively:
The Market Manipulation Scheme
Between in or about December 2008 and in or about September 2011, TUZMAN and a co-conspirator (“CC-1”), who operated a hedge fund (the “Hedge Fund”), engaged in a scheme to artificially inflate the share price and trading volume of KIT digital’s shares.Specifically, at various times when KIT digital’s shares traded on the OTC Bulletin Board and later on the NASDAQ, TUZMAN directed a scheme in which KIT digital shares were purchased and sold through the Hedge Fund, at times for the purpose of manipulating the stock price and at times for the purpose of creating the illusion of greater volume in the trading of KIT digital shares.TUZMAN personally invested his own money into the Hedge Fund and also arranged for KIT digital to invest money in the Hedge Fund, thereby using the Hedge Fund as a vehicle by which KIT digital, at TUZMAN’s direction, invested in itself without disclosing that fact, or the fact of the manipulation, to the investing public.
Specifically, CC-1, with TUZMAN’s knowledge and approval, frequently engaged in match trading in which CC-1 caused an account under CC-1’s control to buy or sell KIT digital stock, and on the same day caused an account under CC-1’s control to take the opposite position.TUZMAN also directed CC-1 to make timely purchases of KIT digital stock in an effort to manipulate the price of KIT digital shares at certain critical moments, including, for instance, when KIT digital was seeking to raise additional capital and in the weeks before KIT digital’s stock began trading on the NASDAQ.At times, CC-1 was responsible for nearly all of the day’s trading activity in KIT digital stock.
Between 2009 and 2010, TUZMAN caused KIT digital to invest approximately $1,150,000 in company cash in the Hedge Fund but failed to disclose to KIT digital shareholders that these investments with the Hedge Fund were not part of an arms-length relationship.Instead, TUZMAN portrayed these investments as efforts to safely invest assets of KIT digital. In reality, TUZMAN caused KIT digital to make these investments in order to help fund CC-1’s purchases of KIT digital shares, as part of the effort to manipulate the market described above.And, on one occasion, TUZMAN caused KIT digital to invest $250,000 in the Hedge Fund so that CC-1 could reimburse TUZMAN for a prior, personal investment that TUZMAN made with the Hedge Fund, thereby using KIT digital as his personal bank.
The Accounting Fraud Scheme
From at least in or about 2010 through in or about 2012, TUZMAN and SMYTH, with others, engaged in an illegal scheme to deceive KIT digital shareholders, members of the investing public, KIT digital’s independent auditors, and others concerning KIT digital’s true operating performance and financial results.
TUZMAN, working with others, including SMYTH, devised and executed a scheme to inflate KIT digital’s revenue falsely.This scheme involved two principal methods: (a) the improper recognition of revenue from so-called “perpetual license” contracts for KIT digital software (contracts that gave the purchasing customer the right to use the licensed software indefinitely), and (b) the execution of fraudulent “round-trip” transactions which had the effect of using KIT digital’s own cash, rather than payments received from customers, to pay off bills, known as accounts receivable, that were due and owed to KIT digital from those customers, rather than disclose to KIT digital’s auditors and the investing public the fact that the bills were uncollectible.
With regard to the first method, TUZMAN and SMYTH knew that KIT digital had sold perpetual licenses for software that, at the time of sale, was not complete and required substantial future development.But instead of booking revenue ratably as KIT digital reached interim development milestones or recognizing revenue in full once software development was complete, TUZMAN and SMYTH caused KIT digital to recognize the entirety of the revenue from certain contracts at the time of sale despite the fact that KIT digital had not delivered a product to KIT digital’s customers.This premature revenue recognition violated relevant software accounting principles and was contrary to KIT digital’s statements to the investing public and its independent auditors, among others.Because of TUZMAN’s and SMYTH’s actions, KIT digital recognized approximately $6,000,000 in revenue that should not have been in its quarterly and annual reports submitted to the SEC, thus misleading the investing public and others about KIT digital’s true financial health.
With regard to the second method, TUZMAN and SMYTH, on at least one occasion, caused KIT digital to use company money, ostensibly escrowed in connection with a KIT digital corporate acquisition, to pay off suspicious or uncollectible receivables by year-end.Specifically, TUZMAN and SMYTH caused KIT digital to add an artificial $7,850,000 “restructuring fee” to the purchase price of a company that KIT digital sought to acquire. Once the purchase price was raised, TUZMAN and SMYTH established an escrow account that was funded with $7,850,000 in KIT digital cash which purported to represent the so-called restructuring fee. The use of the escrowed KIT digital money was governed by a “side letter” between KIT digital and the acquired company that SMYTH created but both defendants intentionally hid from KIT digital’s auditors and the investing public. The side letter dictated that escrowed funds could be used only to cover the costs KIT digital expected to incur from integrating the acquired company into KIT digital. However, TUZMAN and SMYTH used the escrowed money in a round-trip transaction that resulted in KIT digital using its own cash to pay down approximately $4,400,000 in suspicious or uncollectable accounts receivables. TUZMAN’s and SMYTH’s actions caused KIT digital’s 2011 annual financial report to overstate the company’s assets by $7,850,000 and to understate the company’s pre-tax, year-end losses by approximately $4,400,000.
TUZMAN, 43, is charged in eight counts.For the market manipulation scheme, TUZMAN is charged with one count of conspiracy to commit securities fraud, one count of securities fraud, one count of conspiracy to commit wire fraud, and one count of wire fraud.For the accounting fraud scheme, TUZMAN is charged with one count of conspiracy to commit securities fraud, make false statements in annual and quarterly SEC reports, and make false statements to auditors, one count of securities fraud, and two counts of making false statements in annual and quarterly SEC reports.
SMYTH, 61, is charged with one count of conspiracy to commit securities fraud, make false statements in annual and quarterly SEC reports, and make false statements to auditors, one count of securities fraud, and three counts of making false statements in annual and quarterly SEC reports.
The securities fraud and wire fraud counts each carry a maximum sentence of 20 years in prison and a maximum fine of $5,000,000, or twice the gross gain or loss from the offense.Each of the counts for conspiracy to commit securities fraud, make false statements in annual and quarterly SEC reports, and make false statements to auditors carries a maximum sentence of five years in prison. Each count for making false statements in annual and quarterly SEC reports carries a maximum sentence of 20 years in prison.
The statutory maximum sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencings of the defendants would be determined by the judge.
Mr. Bharara praised the work of the Federal Bureau of Investigation and the United States Postal Inspection Service.He also thanked the SEC – which filed charges against TUZMAN and SMYTH today in a parallel civil case – for its assistance.He also thanked the Colombian government for its help in apprehending TUZMAN and thanked the Australian government for its assistance in apprehending SMYTH. He added that the investigation is continuing.
The charges were brought in connection with the President’s Financial Fraud Enforcement Task Force.The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud.Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations.Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants.For more information on the task force, please visit www.StopFraud.gov.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Edward Y. Kim, Sarah E. McCallum, and Damian Williams are in charge of the prosecution.
The allegations contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth below constitute only allegations, and every fact described should be treated as an allegation.
Ferriday woman pleads guilty to stealing Veterans Affairs benefitsRead the Press Release
ALEXANDRIA, La. – United States Attorney Stephanie A. Finley announced today that a Ferriday woman pleaded guilty to stealing more than $100,000 of her deceased aunt’s Veterans Affairs benefits.
Linda Sue Bourgeois, 45, of Ferriday, La., pleaded guilty before U.S. District Judge Dee D. Drell to one count of theft of government property or funds. According to the guilty plea, even though Bourgeois’ aunt died in July of 2007, Bourgeois did not inform Veterans Affairs of the death and took the benefits from a shared bank account until March 2015 when the payments terminated. Bourgeois stole $107,452.33 during the scheme.
Bourgeois faces up to 10 years in prison, three years supervised release, a $250,000 fine and restitution. A sentencing date of December 17, 2015 was set.
Veterans Affairs, Office of Inspector General, conducted the investigation. Assistant U.S. Attorney F. Michael O’Mara is prosecuting the case.
Felon and Domestic Abuser Pleads Guilty to Unlawfully Possessing a FirearmRead the Press Release
A man who unlawfully possessed a loaded handgun in April pled guilty on September 4, 2015, in federal court in Cedar Rapids.
Darius Devon Flowers, age 26, from Cedar Rapids, was convicted of being a felon and domestic abuser in possession of a firearm and ammunition.
At the plea hearing, Flowers admitted that prior to possessing the loaded handgun in April 2015, he had previously been convicted of two felony offenses and two misdemeanor domestic abuse offenses. Public filings allege that on April 22, 2015, Cedar Rapids police were dispatched to a call of a male in possession of a firearm at a residence. A witness at the scene reported Flowers, who appeared to be intoxicated, arrived at her door, showed her the firearm, and told her to call him if she needed him for anything or needed him to “handle anything.” The female called the Cedar Rapids Police Department and provided a description of the vehicle in which Flowers was a passenger. Cedar Rapids Police found the vehicle shortly thereafter, and found the loaded handgun underneath Flowers’s seat.
Sentencing before United States District Court Chief Judge Linda R. Reade will be set after a presentence report is prepared. Flowers remains in custody of the United States Marshal pending sentencing. Flowers faces a possible maximum sentence of 10 years’ imprisonment, a $250,000 fine, $100 in special assessments, and 3 years of supervised release following any imprisonment.
The case was investigated by the Cedar Rapids Safe Street Task Force. The task force is composed of representatives from the Federal Bureau of Investigation; Drug Enforcement Administration; Bureau of Alcohol, Tobacco, Firearms, and Explosives; U.S. Immigration and Customs Enforcement; United States Marshals Service; Iowa Division of Criminal Investigation; Cedar Rapids Police Department; Marion Police Department; Sixth Judicial District Department of Correctional Services; Linn County Sheriff’s Office; and Iowa Department of Inspections and Appeals. The case is being prosecuted by Assistant United States Attorney Dan Chatham.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file numbers are 15-CR-0068-LRR and 15-MJ-00189.
Follow us on Twitter @USAO_NDIA.
Federal Jury Convicts Dallas Man on Drug and Firearm ChargesRead the Press Release
DALLAS — Following a five-day trial, a federal jury has convicted Thomas Earl Wright, 33, of Dallas, on all counts of a superseding indictment charging drug trafficking and firearm offenses, announced U.S. Attorney John Parker of the Northern District of Texas and U.S. Attorney John M. Bales of the Eastern District of Texas.
Specifically, Wright was convicted on one count of possession with intent to distribute five kilograms or more of cocaine, one count of possession with intent to distribute marijuana, one count of possessing a firearm in furtherance of a drug trafficking crime, and one count of being a felon in possession of a firearm.
For the possession with intent to distribute cocaine conviction, a statutory maximum penalty of not less than 10 years and up to life in federal prison and a $1 million fine may be imposed. For the possession with intent to distribute marijuana conviction, a statutory maximum of five years in federal prison and a $250,000 fine may be imposed. The firearm possession conviction carries a statutory penalty of at least five years and not more than life in federal prison and a $250,000 fine. The felon in possession conviction carries a maximum statutory penalty of 10 years in federal prison and a $250,000 fine. Wright is scheduled to be sentenced on January 7, 2016, by U.S. District Judge Jane J. Boyle.
According to documents filed in the case and evidence presented at trial, officers with the Dallas Police Department responded to a welfare complaint about a children coming and going from a narcotics stash house on Packard Street in Dallas. When officers arrived at the residence, they encountered Wright leaving the residence, through its back door, with bundles of cash stuffed in his pockets. Wright’s co-defendant, Eric Tyrone Harris, opened the front door to the residence when officers knocked, and officers noted a strong odor of marijuana emitting from the residence through the front door. A juvenile was at the front door with Harris, and officers removed the child from the residence and released him to a parent.
Law enforcement secured a search warrant and found multiple kilograms of cocaine located in a suitcase in a utility room, more than 100 pounds of marijuana in a bedroom closet, and approximately $30,000 in cash — $3,000 in Wright’s pockets and $27,000 in cash beneath a mattress. In addition, they located three firearms in the residence.
Harris pleaded guilty in April 2015 to one count of possession with intent to distribute cocaine and is scheduled to be sentenced on October 1, 2015.
The Dallas Police Department, U.S. Secret Service, Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Plano Police Department investigated. Assistant U.S. Attorney Errin Martin of the Northern District of Texas and Assistant U.S. Attorney Heather Rattan of the Eastern District of Texas are prosecuting the case.
# # #
Father and Son Sentenced for Defrauding the United StatesRead 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 Gregory Magness, 67, of Polk, Pennsylvania, who was convicted of felony charges of conspiracy to smuggle merchandise into the United States and conspiracy to launder money, and his son Justin Magness, 39, of Clymer, NY, who was convicted of a misdemeanor charge of aiding and abetting in the presenting of false documents to United States Customs, were sentenced by Senior U.S. District Judge William M. Skretny.
Gregory Magness was sentenced to 18 months in prison and ordered to pay $6,246,605 in restitution to the United States. Justin Magness was sentenced to one year probation and ordered to pay $4,500 in restitution to the United States.
Assistant U.S. Attorney Michael DiGiacomo, who handled the case, stated that Gregory and Justin Magness owned and operated a metal powders business. During the course of the operation, they became involved with supplying magnesium used to produce countermeasure flares for the United States Department of Defense. Since the defendants could not produce the magnesium domestically, they imported it from China. However, the United States had a 305% anti-dumping duty in place with respect to magnesium imported from China. In order to avoid paying the 305% duty, the defendants falsely labeled it as a magnesium product only subject to a 5% duty thereby defrauding the United States out of lawful duties.
The sentencings are the culmination of an investigation on the part of the Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of J. Michael Kennedy, Acting Special Agent in Charge, the Internal Revenue Service, Criminal Investigation Division, under the direction of Shantelle P. Kitchen, Special Agent in Charge, and the Department of Defense Criminal Investigative Service, under the direction of Craig W. Rupert, Special Agent in Charge, Northeast Field Office.
The plea is the culmination of an investigation on the part of the FBI's Safe Streets Task Force which includes representatives of the Amherst Police Department; the Buffalo Police Department; U.S. Border Patrol, the Bureau of Alcohol, Tobacco, Firearms, and Explosives; the Cheektowaga Police Department; the Erie County Sheriff’s Department; the Hamburg Police Department; the Lancaster Police Department; the Niagara Frontier Transportation Authority Police; the New York State Department of Correctional Services; the New York State Police; and U.S. Immigration and Customs Enforcement, Homeland Security Investigations. Additional assistance was provided by the Drug Enforcement Administration; U.S. Customs and Border Protection, the United States Marshal Service, the Lackawanna Police Department, and the Niagara County Sheriff’s Department.Skipper will be sentenced on December 18, 2015 at 1:00 p.m. before Judge Arcara.
Evansville man sentenced for possession of child pornographyRead the Press Release
Evansville – United States Attorney Josh Minkler announced today that Richard Brandon Payne, 35, of Evansville, Indiana, was sentenced to 63 months (over five years) in federal prison by U.S. District Chief Judge Richard L. Young following his guilty plea to possession of child pornography. This case was the result of an investigation by the Federal Bureau of Investigation Violent Crimes Task Force and the Evansville Police Department.
On July 7, 2015, at the time of his guilty plea, Payne admitted opening a Google Drive account using his e-mail address and uploading child pornography images into his account. He used a software application to search for and save images of child pornography by using search terms including “kids” and “preteen.” Payne saved some of the sexually explicit images to his Google Drive data storage account.
According to Assistant U.S. Attorney Todd S. Shellenbarger, who prosecuted the case for the government, Judge Young imposed 10 years of supervised release following Payne’s release from prison. Payne must register as a sex offender, must not have unsupervised contact with minors, and also must participate in a sex offender treatment program while on supervision.
This case was brought as a part of Project Safe Childhood. The Department of Justice launched Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the United States Attorney’s Offices, Project Safe Childhood uses federal, state and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as identify and rescue victims. For more information about Project Safe Childhood, please see www.projectsafechildhood.gov/.
Detroit man sentenced to federal prison for leading Huntington heroin conspiracyRead the Press Release
HUNTINGTON, W.Va. – A Detroit man who led a heroin conspiracy that funneled substantial amounts of heroin into the Huntington area between 2012 and 2014 was sentenced today to 11 years and six months in federal prison, announced United States Attorney Booth Goodwin. Christopher Jermaine Taylor, 30, previously pleaded guilty in federal court in Huntington in February of 2015 to conspiring to distribute 100 grams or more of heroin.
Taylor admitted that between the summer of 2012 to February of 2014, he conspired with others to distribute heroin in the Huntington area. During the conspiracy, shipments of heroin were frequently delivered from Michigan to Huntington at Taylor’s direction. Taylor and his co-conspirators then utilized multiple residences in Huntington as locations from which they prepared, stored and distributed heroin.
At Taylor’s sentencing hearing, the Court imposed enhanced penalties based on Taylor’s leadership role in the conspiracy, his maintenance of a dwelling for the purpose of distributing heroin, and his possession of a firearm during the conspiracy. The Court also found that the organization was responsible for the distribution of over 2 kilograms of heroin in the Huntington area.
Others convicted for their roles in the conspiracy include Bryant Donavan Taylor of Detroit who received 78 months in federal prison, Kenneth D. Bowden of Detroit who received 97 months in federal prison, Robert Lamar Payne of Detroit who received 87 months in federal prison, Derrick Wayne Goodwin of Detroit who received 74 months in federal prison, and Lakeisha Sherrell Williams of Detroit who received 37 months in federal prison. Darius Jerome Perry of Detroit is scheduled to be sentenced on September 28, 2015.
The Huntington FBI Drug Task Force conducted the investigation. Assistant United States Attorney Joseph F. Adams handled the prosecution.
This case was prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and heroin. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
Detroit man pleads guilty in federal court to conspiracy to distribute heroinRead the Press Release
HUNTINGTON, W.Va. – A Detroit man who participated in a heroin distribution conspiracy between 2013 and 2015 pleaded guilty today to a federal drug charge, announced U.S. Attorney Booth Goodwin. Sean L. Gist, 21, entered a guilty plea in federal court in Huntington to conspiring to distribute 100 grams or more of heroin.
From at least December of 2013 to January of 2015, Gist participated in a conspiracy that transported heroin from Detroit to Huntington for distribution. Once in Huntington, Gist provided heroin to others for distribution from multiple residences in Huntington. Gist also distributed heroin himself and arranged the sale of heroin to a confidential informant on January 28, 2015. Gist admitted during the plea hearing that he possessed a firearm in connection with the conspiracy.
Multiple others have been convicted for their respective roles in the conspiracy including Paul A. Roberts, who pleaded guilty to maintaining a residence for the distribution of heroin in March 2015, Ramone L. Wells, who pleaded guilty to conspiracy to distribute heroin in June 2015, Pricilla Lee Dylan, who pleaded guilty to maintaining a residence for the distribution of heroin in August 2015, Dustin S. Barton, who pleaded guilty to distributing heroin in August 2015, Kenneth E. Baxter, who pleaded guilty to distributing heroin in August 2015, and Coty S. Richardson, who pleaded guilty to attempting to possess with intent to distribute 100 grams or more of heroin in August 2015,
Gist faces up to 20 years in federal prison, and is scheduled to be sentenced on December 14, 2015.
The Huntington FBI Drug Task Force, United States Postal Service, West Virginia State Police and Huntington Police Department conducted the investigation. Assistant United States Attorney Joseph F. Adams is in charge of the prosecution.
This case is being prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and heroin. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
Detroit Gang Leader Sentenced to 35 Years for Violent Racketeering-Related CrimesRead the Press Release
The National President of the Phantom Outlaw Motorcycle Club and “Three-Star General” of the Vice Lords street gang in Michigan was sentenced today to serve 35 years in prison for violent racketeering-related crimes. To date, 12 other defendants have been convicted of federal offenses related to their roles in this violent conspiracy.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan, Special Agent in Charge Robin Shoemaker of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and Special Agent in Charge Paul M. Abbate of the FBI’s Detroit Division made the announcement.
The arrests and convictions in this case are, in part, the result of the Detroit One Initiative, a collaborative effort between law enforcement and the community to reduce homicide and other violent crime in Detroit. Through the lead efforts of the Comprehensive Violence Reduction Partnership Task Force, which consists of representatives of the ATF, Detroit Police Department, Michigan State Police, Michigan Department of Corrections and the FBI, law enforcement authorities linked various acts of violence in Detroit to the Phantom Outlaw Motorcycle Club and the Vice Lords street gang, and identified the leaders and key members of these gangs, who now have been held accountable.
Antonio Johnson, aka Mister Tony, MT or Big Bro, 39, of Detroit, was convicted on March 16, 2015, after a multi-week trial, of engaging in a racketeering conspiracy, conspiracy to commit murder in aid of racketeering, assault with a dangerous weapon in aid of racketeering, conspiracy to assault with a dangerous weapon in aid of racketeering, use and carry of a firearm during and in relation to a crime of violence, and being a felon in possession of firearms. U.S. District Judge Paul D. Borman of the Eastern District of Michigan presided over the trial and imposed today’s sentence.
“Through his leadership positions in two gangs, Johnson spread violence in Detroit and beyond,” said Assistant Attorney General Caldwell. “Here, through the Detroit One initiative, the collective efforts of federal agents, state and local police, and private citizens helped thwart a mass murder plot and ensure the convictions and lengthy prison sentences of Johnson and his fellow gang members. This case is emblematic of law and order at its best: a true partnership between law enforcement authorities and the community they serve.”
“Gang wars fuel violence in our community, and the resulting drive-by shootings create unacceptable risk to innocent lives,” said U.S. Attorney McQuade. “The Detroit One partners are systematically dismantling violent street and motorcycle gangs that are destroying the peace in our neighborhoods.”
“This significant sentence is the result of our on-going state and federal effort to combat gun violence in our communities,” said Special Agent in Charge Shoemaker. “This investigation and resulting convictions is proof again that the Detroit One initiative and the CVRP are making a significant difference in our communities, there is a lot of work to do, but ATF is committed in the fight against violent crime.”
At trial, evidence showed that the Phantom Outlaw Motorcycle Club, which is headquartered in northwest Detroit, and its members were involved in a range of criminal activity including conspiracy to commit murder, shootings, robbery, extortion and the possession and sale of stolen vehicles and motorcycles. The evidence also demonstrated that the leadership of the Phantoms was heavily involved in the Vice Lords, a well-known street gang originating from Chicago, and that Johnson was both the National President of the Phantoms and a leader of the Vice Lords in Michigan. The evidence showed that Johnson used the Vice Lords to assist the Phantoms in various criminal endeavors, including to search for and violently attack rivals of the Phantoms.
Specifically, according to the evidence presented at trial, on Sept. 8 2013, Johnson ordered numerous Phantoms to forcibly steal the “rags,” or motorcycle vests, of members of the rival Satan Sidekick Motorcycle Club. The evidence showed that, during Phantoms’ attempt to do so, a Satan Sidekick member was shot in the face and a Phantom member was stabbed.
According to the evidence presented at trial, a few weeks later, Johnson and his fellow Phantoms plotted the murder of three members of the rival Hell Lovers Motorcycle Club whom the Phantoms believed were responsible for a shooting death of a member of their club. According to the evidence presented at trial, the plot involved killing the three men and then, during the anticipated subsequent wake at the Hell Lovers’ clubhouse, shooting all Hell Lovers in attendance. ATF and FBI agents intervened before the Phantoms carried out the plot.
In addition to Johnson, the following defendants have been convicted and sentenced:
-
Marvin Nicholson, 46, of Detroit, was convicted of RICO conspiracy, conspiracy to commit murder in aid of racketeering, assault with a dangerous weapon in aid of racketeering, conspiracy to assault with a dangerous weapon in aid of racketeering, use and carry of firearms during and in relation to a crime of violence, assault of federal officers and felon in possession of firearms.He was sentenced to serve 40 years in prison.
-
Brian Sorrell, 28, of Detroit, was convicted of RICO conspiracy, conspiracy to commit murder in aid of racketeering, assault with a dangerous weapon in aid of racketeering, conspiracy to assault with a dangerous weapon in aid of racketeering, and use and carry of firearms during and in relation to a crime of violence.He was sentenced to serve 21 years in prison.
-
Matthew Schamante, 33, of Waterford, was convicted of RICO conspiracy, and was sentenced to serve 102 months in prison.
-
Brian Jackson, 48, of Detroit, was convicted of conspiracy to commit murder in aid of racketeering, and was sentenced to serve 96 months in prison.
-
Sherman Brown, 44, of Detroit, was convicted of conspiracy to commit murder in aid of racketeering, and was sentenced to serve 100 months in prison.
-
Brandon Paige, 21, of Detroit, was convicted of conspiracy to commit murder in aid of racketeering, and was sentenced to serve 90 months in prison.
-
Roger Valdes, 30, of Pontiac, Michigan, was convicted of assault with a dangerous weapon in aid of racketeering and use and carry of firearms during and in relation to a crime of violence, and was sentenced to serve 49 months in prison.
The following defendants also have been convicted, but have not yet been sentenced:
-
Raynard Brown, 39, of Detroit, was convicted of RICO conspiracy.
-
Vicente Phillips, 51, of Pontiac, was convicted of RICO conspiracy.
-
Maurice Williams, 34, of Detroit, was convicted of RICO conspiracy.
-
Christopher Odum, 30, of Detroit, was convicted of conspiracy to commit murder in aid of racketeering.
-
William Frazier, 37, of Auburn Hills, Michigan, was convicted of assault with a dangerous weapon in aid of racketeering and use and carry of firearms during and in relation to a crime of violence.
The case was investigated by the ATF and the FBI. The case was prosecuted by Trial Attorney Joseph Wheatley of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorneys Christopher Graveline and Louis Gabel of the Eastern District of Michigan.
Through the Detroit One initiative, local, state, and federal law enforcement authorities are maximizing their abilities to identify and arrest those responsible for violence in Detroit. Since 2013, this collective effort has had led to significant indictments, convictions, and sentences against a number of street gang members responsible for much of the violent crime in Detroit. These collaboration also has contributed to a decrease in the homicide rate from 386 in 2012 to 300 in 2014, and in the overall violent crime rate.
-
Department of Justice and Federal Trade Commission Sign Antitrust Memorandum of Understanding with Korea Fair Trade CommissionRead the Press Release
The Department of Justice and the Federal Trade Commission signed an antitrust memorandum of understanding (MOU) with the Korea Fair Trade Commission (KFTC) today to promote increased cooperation and communication among the competition agencies in both countries. The MOU was signed in Washington, D.C. by Assistant Attorney General Bill Baer of the Justice Department’s Antitrust Division, Chairwoman Edith Ramirez of the FTC and Chairman Jeong Jae-chan of the KFTC, and went into effect upon signature.
“This memorandum of understanding recognizes the day-to-day working relationship we already enjoy with the KFTC and expresses our interest in continuing and strengthening that relationship in the years to come,” said Assistant Attorney General Baer. “Enforcement cooperation – including candid and constructive dialogue – is critical to maintaining competitive markets in the United States, Korea and around the world."
“This MOU marks an important point in our relationship with the KFTC, providing an opportunity to further strengthen our agencies’ interactions and solidify our cooperative efforts throughout Asia,” said Chairwoman Ramirez. “It will help us to work even more closely to promote convergence around sound competition policy and procedures.”
Highlights of the new agreement include the following:
-
mutual acknowledgment of the importance of antitrust cooperation, including an intention to coordinate when pursuing enforcement activities on matters under common review;
-
articulating the framework for communications between the U.S. antitrust agencies and the KFTC; and
-
committing to maintain the confidentiality of any information provided by the other party and honoring prohibitions on sharing information when not permitted by law.
The U.S. antitrust agencies and the KFTC have developed an increasingly close working relationship since Korea adopted its competition law in 1981, which includes exchanging views on policy and, as appropriate, cooperating on investigations. Today’s MOU is intended to further promote these relations.
The MOU with the KFTC is the U.S. antitrust agencies’ third antitrust cooperation arrangement in East Asia, following those reached with Japan in 1999 and the Chinese competition agencies in 2011.
-