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6 August 2015
Four Charged in Armed Robberies of Check Cashing BusinessesRead the Press Release
PHILADELPHIA - Nysare Alston, 25, Christopher Corley, 27, Hassan Corley, 27, and Kenneth Thomas, 24, all of Philadelphia, Pennsylvania, were charged by indictment, unsealed today, in an alleged robbery spree involving Philadelphia check cashing businesses, announced United States Attorney Zane David Memeger. The defendants are charged with Hobbs Act robbery and related weapons offenses.
According to the indictment, the defendants committed the following armed robberies: on February 15, 2014, the America’s Cash Express, located at 5045 Wayne Avenue, of more than $49,000; on July 12, 2014, the Diamond Check Cashing, located at 4261 Frankford Avenue, of approximately $34,000; on July 25, 2014, the Ace Check Cashing, located at 2557 W. Sterner Street, of approximately $10,000; on September 10, 2014, Don’s Check Cashing, located at 1202 E. Hunting Park Avenue, of approximately $31,000; and the attempted armed robbery, on August 2, 2014, of Ace Check Cashing, located at 4244 N. Broad Street.
If convicted of all charges, Alston and Thomas each face a mandatory minimum sentence of 82 years in prison; C. Corley faces a mandatory minimum sentence of 32 years in prison; H. Corley faces a mandatory minimum term of seven years in prison; plus fines, supervised release, and special assessments.
The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Yvonne Osirim.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Former U.S. Army Lieutenant Colonel Sentenced to Three Years in Federal Prison for Accepting GratuitiesRead the Press Release
In San Antonio today, a federal judge sentenced 49-year-old Mark L. Moss of Cibolo, TX, to three years in federal prison for accepting gratuities from businessmen while serving as a military unit commander in Kuwait. In addition to the prison term, U. S. District Judge Orlando Garcia ordered that Moss pay $253,000 restitution and be placed on supervised release for a period of three years after completing his prison term.
That announcement was made today by United States Attorney Richard L. Durbin, Jr.; Special Agent in Charge Janice M. Flores, Defense Criminal Investigative Service’s Southwest Field Office; Special Agent in Charge Scott Wilk, U.S. Army Criminal Investigation Command Southwestern Fraud Field Office; Special Agent in Charge Christopher Combs, Federal Bureau of Investigation; and, Special Agent in Charge William Cotter, Internal Revenue Service-Criminal Investigation.
“Mr. Moss corrupted the military procurement process for personal gain. While service members in a conflict zone made great sacrifices, Mr. Moss used his position to line his pockets with a quarter million dollars,” stated United States Attorney Richard L. Durbin, Jr.
In September 2014, Moss pleaded guilty to one count of acts affecting a personal financial interest. By pleading guilty, Moss admitted to accepting $253,000 from two business owners and their respective agents while he served as a designated unit commander for the Area Support Group in Camp Arifjan, Kuwait. Those Kuwait-based businesses included Al-Pacific LTD Est. for Electronics (Al-Pacific), an electronics communications and services company which primarily provided the access, installation, maintenance of cable and satellite television as well as internet connectivity to the base; and, Makhpiya Project Management (MPM), a general contractor specializing in engineering, construction and communications.
According to court records, from November 2007 until June 2010, Moss accepted and received the funds in exchange for favoring Al-Pacific and MPM during the Army contract award selection process; recommending MPM as a subcontractor to other companies that were awarded contracts; and, expediting Al-Pacific and MPM’s request for security badges allowing both companies more efficient access to the base.
“Misusing his position of trust as a Lieutenant Colonel in the U.S. Army, Mr. Moss accepted at least $253,000 in money and gratuities from several companies seeking contracts with the U.S. Government. Today's sentencing demonstrates the severe criminal penalties that result when Government officials, motivated purely by greed, betray their oath to this great country and its citizens for their own personal benefit. IRS Criminal Investigation, along with our law enforcement partners and the United States Attorney's Office, remain vigilant in identifying, investigating and prosecuting those who seek to willfully defraud the U.S Government and its taxpayers,” stated IRS-Criminal Investigation Special Agent in Charge William Cotter.
The case resulted from an investigation by the Defense Criminal Investigative Service (DCIS), U.S. Army Criminal Investigation Command (CIDC) Southwestern Fraud Field Office, Internal Revenue Service-Criminal Investigation and the Federal Bureau of Investigation. Assistant United States Attorney Tom Moore prosecuted this case on behalf of the Government.
Former Director of Virgin Islands Public Finance Authority and Others Charged with Conspiracy and BriberyRead the Press Release
Three Virgin Islands men were charged in an indictment unsealed today with various offenses based on their participation in a bribery scheme involving over $17 million in construction contracts awarded by the Virgin Islands Public Finance Authority (VIPFA).
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Ronald W. Sharpe of the District of the Virgin Islands, Special Agent in Charge Carlos Cases of the FBI’s San Juan, Puerto Rico, Division, Virgin Islands Inspector General Steven Van Beverhoudt and Special Agent in Charge Kelly R. Jackson of the Internal Revenue Service-Criminal Investigation (IRS-CI) made the announcement.
Julito Francis, 53, former Director of Finance and Administration for the VIPFA, is charged with 11 counts of conspiracy, bribery, extortion under color of official right, honest services wire fraud and perjury. Gerard Castor, 69, president and owner of Balbo Construction Corporation, is charged with 10 counts of conspiracy, bribery and honest services wire fraud. John Woods, 59, co-principal of an architectural company that worked on behalf of the VIPFA, is charged with three counts of conspiracy, bribery and extortion under color of official right.
Francis, Castor and Woods were arrested earlier today and appeared before U.S. Magistrate Judge Ruth Miller of the District of the Virgin Islands. The defendants were released pending an August 12 arraignment.
According to the indictment, Castor provided more than $400,000 in improvements to Francis’ personal residence, and over $10,000 in improvements to Woods’ personal property. In return, Francis and Woods used their official positions to ensure that Balbo Construction was awarded construction contracts by the VIPFA that were worth over $17 million, including a multi-million contract, and supplements thereto, to build the St. Thomas Regional Library. The indictment further alleges that the defendants attempted to conceal the bribery scheme by creating false documents that suggested Francis and Woods intended to pay Castor for the work performed.
The charges and allegations contained in an indictment are merely accusations. The defendants are presumed innocent unless and until proven guilty.
This case is being investigated by the FBI’s San Juan Division, St. Thomas Resident Agency, the Virgin Islands Office of the Inspector General and IRS-CI. This case is being prosecuted by Trial Attorneys Laura Fulton and Justin D. Weitz of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Nelson Jones of the District of the Virgin Islands. Deputy Chief Tracee Plowell of the Criminal Division’s Office of Enforcement Operations and Trial Attorney Jennifer Blackwell of the Environment and Natural Resources Division’s Environmental Crimes Section participated in the investigation when they were assigned to the Public Integrity Section.
Francis et al Indictment
Former Construction Boss Sentenced to More Than 15 Years for Role in $58 Million Scheme to Fraudulently Control Homeowners’ AssociationsRead the Press Release
A former construction boss from Las Vegas was sentenced today to 188 months in prison for his role in a $58,141,275 million scheme to fraudulently gain control of condominium homeowners’ associations (HOAs) in the Las Vegas area to secure construction and other contracts for himself and others. Forty-two individuals have been convicted of crimes in connection with the scheme.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Special Agent in Charge Laura A. Bucheit of the FBI’s Las Vegas Office, Sheriff Joseph Lombardo of the Las Vegas Metropolitan Police Department and Chief Richard Weber of the Internal Revenue Service-Criminal Investigation (IRS-CI) made the announcement.
Leon Benzer, 48, pleaded guilty on Jan. 23, 2015, to one count of conspiracy to commit mail and wire fraud, 14 counts of wire fraud, two counts of mail fraud and two counts of tax evasion. In addition to imposing the prison term, U.S. District Judge James C. Mahan of the District of Nevada ordered Benzer to pay restitution in the amount of $13,294,100.
“Leon Benzer recruited and paid off puppets to serve on homeowners’ boards so that they would steer lucrative contracts to his company and cronies,” said Assistant Attorney General Caldwell. “Far from enjoying their corrupt proceeds, however, Benzer and his co-conspirators will serve years behind prison bars.”
“This sentence serves as a reminder of the FBI's dedication and commitment to investigate, apprehend and prosecute criminals that prey on innocent and unsuspecting consumers,” said Special Agent in Charge Bucheit.
“When Leon Benzer named his company, Silver Lining Construction, he probably wasn’t aware of the IRS Criminal Investigation Division and the expertise of our special agents when it comes to putting pieces of a puzzle together to build a picture of fraudulent activity,” said Chief Weber. “Benzer manipulated and bribed HOA boards in order to enrich himself and his co-conspirators at the expense of American taxpayers. Not only did he try to hide the proceeds of his crimes in order to evade paying taxes, but he failed to pay his employment taxes. Today, justice was served and the “silver lining” that Benzer anticipated was not realized thanks to the work of IRS-CI and our law enforcement partners.”
In connection with his guilty plea, Benzer admitted that, from approximately August 2003 through February 2009, he and an attorney developed a scheme to control the boards of directors of HOAs in the Las Vegas area. According to plea documents, Benzer and his co-conspirators recruited straw buyers to purchase condominiums and secure positions on HOAs’ boards of directors. Benzer admitted that he paid the board members to take actions favorable to his interests, including hiring his co-conspirator’s law firm to handle construction-related litigation and awarding remedial construction contracts to Benzer’s company, Silver Lining Construction.
The case was investigated by the FBI, IRS-CI and the Las Vegas Metropolitan Police Department’s Criminal Intelligence Section. The case was prosecuted by Deputy Chief Charles La Bella and Trial Attorneys Thomas B.W. Hall and Alison Anderson of the Criminal Division’s Fraud Section.
Federal Court Sentences Davenport Man for Felon in Possession of A Firearm ChargeRead the Press Release
DAVENPORT, IA - On July 29, 2015, Keelyn Stokes, age 21, of Davenport, Iowa, was sentenced by United States District Court Judge John A. Jarvey to 85 months in prison, after Stokes pleaded guilty to the charge of felon in possession of a firearm, announced United States Attorney Nicholas A. Klinefeldt. Stokes was also ordered to serve three years of supervised release following the period of incarceration, and to pay $100 towards the Crime Victims Fund.
On April 16, 2014, Davenport Police officers responded to a disturbance and saw several individuals exiting and running from a stolen vehicle. As officers gave chase, Stokes was seen throwing down a gun while running. The firearm, which was later recovered by the officers, was identified as a Bryco .25 caliber handgun with a loaded magazine. Stokes had been convicted of a felony prior to April 2014.
This case was investigated by the Bureau of Alcohol, Tobacco and Firearms and the Davenport Police Department, and the case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa as part of the Project Safe Neighborhood initiative.
Former Director of Virgin Islands Public Finance Authority and Others Charged with Conspiracy and BriberyRead the Press Release
WASHINGTON – Three Virgin Islands men were charged in an indictment unsealed today with various offenses based on their participation in a bribery scheme involving over $17 million in construction contracts awarded by the Virgin Islands Public Finance Authority (VIPFA).
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Ronald W. Sharpe of the District of the Virgin Islands, Special Agent in Charge Carlos Cases of the FBI’s San Juan, Puerto Rico, Division, Virgin Islands Inspector General Steven Van Beverhoudt and Special Agent in Charge Kelly R. Jackson of the Internal Revenue Service-Criminal Investigation (IRS-CI) made the announcement.
Julito Francis, 53, former Director of Finance and Administration for the VIPFA, is charged with 11 counts of conspiracy, bribery, extortion under color of official right, honest services wire fraud and perjury. Gerard Castor, 69, president and owner of Balbo Construction Corporation, is charged with 10 counts of conspiracy, bribery and honest services wire fraud. John Woods, 59, co-principal of an architectural company that worked on behalf of the VIPFA, is charged with three counts of conspiracy, bribery and extortion under color of official right.
Francis, Castor and Woods were arrested earlier today and appeared before U.S. Magistrate Judge Ruth Miller of the District of the Virgin Islands. The defendants were released pending an August 12 arraignment.
According to the indictment, Castor provided more than $400,000 in improvements to Francis’ personal residence, and over $10,000 in improvements to Woods’ personal property. In return, Francis and Woods used their official positions to ensure that Balbo Construction was awarded construction contracts by the VIPFA that were worth over $17 million, including a multi-million contract, and supplements thereto, to build the St.Thomas Regional Library. The indictment further alleges that the defendants attempted to conceal the bribery scheme by creating false documents that suggested Francis and Woods intended to pay Castor for the work performed.
The charges and allegations contained in an indictment are merely accusations. The defendants are presumed innocent unless and until proven guilty.
This case is being investigated by the FBI’s San Juan Division, St. Thomas Resident Agency, the Virgin Islands Office of the Inspector General and IRS-CI. This case is being prosecuted by Trial Attorneys Laura Fulton and Justin D. Weitz of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Nelson Jones of the District of the Virgin Islands. Deputy Chief Tracee Plowell of the Criminal Division’s Office of Enforcement Operations and Trial Attorney Jennifer Blackwell of the Environment and Natural Resources Division’s Environmental Crimes Section participated in the investigation when they were assigned to the Public Integrity Section.
Essex County, New Jersey, Man Sentenced to 92 Months in Prison for Unlawful Possession of A Loaded Semiautomatic HandgunRead the Press Release
NEWARK, N.J. – A previously convicted felon from Irvington, New Jersey, was sentenced today to 92 months in prison for unlawfully possessing a loaded semiautomatic handgun, U.S. Attorney Paul J. Fishman announced.
Terrell Haywood, 26, previously pleaded guilty before U.S. District Judge William J. Martini to an indictment charging him with being a felon in possession of a firearm. Judge Martini imposed the sentence today in Newark federal court.
According to documents filed in the case and statements made in court:
On April 26, 2014, in Newark, Haywood knowingly possessed a loaded Springfield Armory Ultra Compact Semi-Automatic .45 caliber handgun that was loaded with nine rounds of ammunition. As law enforcement officers from the Essex County Prosecutor’s Office observed Haywood crossing a street, they observed a bulge in his jacket pocket that was consistent with the presence of a handgun. Haywood was searched and found with the handgun, as well as various drugs, including marijuana and prescription pills.
In addition to the prison term, Judge Martini sentenced Haywood to three years of supervised release.
U.S. Attorney Fishman credited the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Carolyn A. Murray, with the investigation leading to today’s sentencing. He also thanked the FBI, under the direction of Special Agent in Charge Richard M. Frankel in Newark, for their role in the investigation.
The government is represented by Assistant U.S. Attorney Jonathan W. Romankow of the U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel: Martin Goldman Esq., West Caldwell, New Jersey
Drug Operation Convicts 13 Defendants of Montana Drug Trafficking Operation Run from a California PrisonRead the Press Release
BILLINGS – The United States Attorney’s Office announces today the completion of a Montana operation that convicted thirteen defendants for methamphetamine, firearm, and money laundering charges, involving an estimated $300,000 worth of meth in Montana. Operation Pale Mule joined numerous law enforcement agencies in Montana and California and involved a conspiracy to distribute approximately 10 pounds of methamphetamine in Montana, much of which was orchestrated by defendant Jason Neel, 31, from inside a California prison while serving a sentence for second degree murder. Neel was sentenced to 50 years in prison by U.S. District Court Judge Susan P. Watters. The final defendant, Mario Albert Villegas, 32, of Los Angeles, CA, was sentenced today to 30 years in prison and 10 years of supervised release. Villegas distributed a total of six pounds of meth.
“This operation put an end to an organization that was delivering dangerous drugs straight into our Montana communities,” said Mike Cotter, U.S. Attorney for the District of Montana. “Methamphetamine has a devastating ripple effect—it ruins lives, families and communities. I am proud of the hard work and long hours the members of this operation invested in these cases. Our state is a safer place as a result.”
"In safeguarding our communities today, there is literally nothing we do alone,” said Eric Barnhart, Special Agent in Charge of the FBI Salt Lake City Division. “This case represents the epitome of collaboration between law enforcement agencies throughout Montana, as well as our partners in California and South Dakota, in targeting and dismantling a violent drug trafficking organization.”
The investigation joined more than 70 law enforcement officers working across eastern Montana and in California, and involved nearly 60 warrants to obtain information about the drug trafficking conspiracy. The conspiracy was responsible for bringing roughly 5 kilograms of meth into Montana, valued at approximately $300,000. Law enforcement also uncovered a funnel bank account, where drug distributors would deposit their proceeds at a Montana bank and another defendant in California would take the money out to pay the sources of drugs. Law enforcement was able to determine that $42,000 was laundered through one bank account, with an additional $5,000 through other money transfers. Law enforcement also seized $6,639 and a 2007 BMW vehicle, which were linked to the drug trafficking crimes.
All members of the drug trafficking organization have either pleaded guilty or been convicted of federal charges ranging from conspiracy to possess with intent to distribute and distribute meth, possession with intent to distribute meth, distribution of meth, possession of a firearm in furtherance of a drug trafficking crime, and conspiracy to commit money laundering.
Investigation of the drug trafficking organization began in September of 2013, when law enforcement agents with the FBI and Eastern Montana High Intensity Drug Trafficking Area Task Force (HIDTA) began investigating a drug trafficking organization responsible for shipping methamphetamine from Southern California to Billings and Roundup, Montana. Agents introduced an undercover agent into the organization, and the undercover agent purchased methamphetamine from one of the leaders of the organization, Casey Fleming, as well as local distributors. Agents soon learned that Fleming was working with Jason Robert Neel an inmate at California State Prison (Corcoran Unit) who was serving a sentence of 44 years to life for second-degree murder. Neel was able to have a prison employee smuggle cell phones into the prison so that he could effectively run the organization.
As part of the investigation, law enforcement agents were granted a Title III wiretap for two cell phones used by Casey Fleming as well as Neel’s prison cell phone and Neel’s girlfriend, Desiree Jimenez. Wiretaps are granted through a rigorous legal process and allow law enforcement to listen to telephone communications for a specified duration. Agents learned that Fleming was first obtaining methamphetamine from Mario Villegas, a resident of Los Angeles, California, and later from David Delcarmen, also a residence of the Los Angeles area. Fleming utilized a network of subordinates to ship the methamphetamine from California to Montana. Local dealers in Montana would then distribute the methamphetamine in Eastern Montana once it arrived.
During the wiretap investigation, agents were able to determine that the packages of meth were being shipped to residences in Roundup and Billings, Montana, and they intercepted those packages. All of the methamphetamine seized in this investigation was highly pure, ranging from purity levels from 90% to 100% pure methamphetamine. In total, agents estimate that the organization transported five kilograms of methamphetamine from Southern California to Montana during the course of the conspiracy.
A Montana grand jury ultimately indicted 13 defendants responsible for the drug trafficking organization. Twelve of the defendants pleaded guilty and one, Mario Villegas, was convicted following a jury trial. The case was prosecuted by Assistant U.S. Attorneys Joe Thaggard, Tara Elliott, Brendan McCarthy and John Sullivan. This investigation involved the cooperation of many law enforcement agencies in Montana and California, including the Federal Bureau of Investigation, the FBI Big Sky Safe Streets Task Force, and the Eastern Montana HIDTA, which includes representation from the Billings Police Department, Yellowstone County Sheriff’s Office, Homeland Security Investigations, U.S. Customs and Border Patrol, DEA and IRS. Both task forces collaborated with law enforcement partners at the Montana Division of Criminal Investigation, U.S. Marshals Services, Montana National Guard, U.S. Postal Service, FBI offices in California, California Highway Patrol, as well as the Billings and FBI SWAT teams.
Department of Justice and the National Institute of Standards and Technology Name Six Experts as New Members of National Commission on Forensic ScienceRead the Press Release
The Department of Justice and the Department of Commerce’s National Institute of Standards and Technology (NIST) today announced six appointments to the National Commission on Forensic Science.
The commission, created in 2013, develops forward-looking policy recommendations for the Attorney General to enhance the practice and improve the reliability of forensic science.
The commission is co-chaired by Deputy Attorney General Sally Quillian Yates and Under Secretary of Commerce for Standards and Technology and NIST Director Dr. Willie E. May. Deputy Assistant Administrator Nelson Santos of the Drug Enforcement Administration’s Office of Forensic Sciences and Special Assistant John M. Butler to the NIST Director for Forensic Science serve as vice-chairs.
“For nearly two years, the commission has been hard at work developing recommendations to strengthen the field of forensic science and the six new commissioners will bring valuable new insights to this process,” said Deputy Attorney General Yates. “Their work is vital to ensuring the fairness of our criminal justice system.”
“Confidence in the collection, review and analysis of evidence by law enforcement and in the ability of the courts to fairly judge the strength of that evidence is the bedrock of any civil society,” said Under Secretary May. “The new commissioners represent a diverse range of skills and training and we look forward to their contributions as we continue our efforts to ensure that the forensic evidence used in our criminal justice system is supported by rigorous science, measurements and analysis.”
The commission includes federal, state and local forensic science service providers; research scientists and academics; law enforcement officials; prosecutors, defense attorneys and judges; and other stakeholders from across the country. This breadth of experience and expertise reflects the many different entities that contribute to forensic science practice in the United States and will ensure that these broad perspectives are represented on the commission and in its work.
The commission was established in 2013 and re-chartered for another two-year period in April 2015. The new members announced today are replacing individuals whose tenures with the commission recently ended. Because the re-charter includes a provision for digital evidence, an additional commissioner has been added to provide perspective in this important area of forensic science.
The new commissioners are:
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Thomas D. Albright, Ph.D., Professor and Conrad T. Prebys Chair at The Salk Institute for Biological Studies in La Jolla, California;
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Arturo Casadevall, M.D., Ph.D., Bloomberg Distinguished Professor and Alfred and Jill Summer Professor and Chair of Molecular Microbiology and Immunology at the Johns Hopkins University Bloomberg School of Public Health in Baltimore;
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Gregory C. Champagne, Sheriff of St. Charles Parish, Louisiana;
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William N. Crane, Associate Professor and Director of the Champlain College Graduate Digital Forensic Program in Burlington, Vermont;
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Deirdre M. Daly, U.S. Attorney of the District of Connecticut; and
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Sunita Sah, M.D., Ph.D., Assistant Professor of Management and Organizations at the Cornell University Johnson Graduate School of Management in Ithaca, New York.
The commission’s next meeting will be held from August 10 to 11, 2015, at the House of Sweden, 2900 K Street, Washington, D.C. More information about the commission can be found at http://www.justice.gov/ncfs.
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Defendant from Operation “Wild Wild East” Pleads GuiltyRead the Press Release
U.S. Attorney Kenneth A. Polite announced that New Orleans resident BETH MARIE NGUYEN, age 38, pled guilty today to conspiracy to distribute and conspiracy to possess with intent to distribute over one kilogram of heroin.
U.S. District Judge Carl J. Barbier will sentence NGUYEN on November 12, 2015. NGUYEN is facing 10 years and a maximum of life imprisonment, as well as a possible fine of up to $10,000,000.
NGUYEN was one of twelve defendants charged in a 23-count indictment on July 25, 2014. According to court documents, this indictment sprung from an investigation into a heroin-trafficking organization operating in New Orleans East. This organization was responsible for distributing at least 15 kilograms of heroin in the New Orleans area. As part of the arrests in this case, federal agents have seized from the twelve defendants approximately $1,200,000 in assets (a combination of vehicles, currency, jewelry, and real property) as proceeds made from the sale of heroin.
U.S. Attorney Polite praised the work of the Drug Enforcement Administration in investigating this matter. Assistant United States Attorney Brandon S. Long is in charge of the prosecution.
DeQuincy man sentenced to 12 months in prison for printing $100 bills in casino hotel roomRead the Press Release
LAKE CHARLES, La. – United States Attorney Stephanie A. Finley announced today that a DeQuincy man was sentenced to 12 months and one day in prison for making $100 counterfeit bills at a casino hotel.
Deldrick Shykil Fowler, 22, of DeQuincy, La., was sentenced by U.S. District Judge Patricia Minaldi on one count of counterfeiting obligations to the United States. He was also sentenced to three years of supervised release. According to evidence presented at the April 30, 2015 guilty plea, surveillance equipment was used to observe Fowler on August 12, 2014 at the Isle of Capri Casino in Lake Charles producing counterfeit $100 bills in a hotel room. Agents seized two counterfeit $100 bills, 16 uncut sheets of $100 bills, and 10 uncut sheets of $100 bills printed on only one side.
The U.S. Secret Service conducted the investigation. Assistant U.S. Attorneys Robert C. Abendroth and Howard C. Parker prosecuted the case.
Dallas Man Admits to Using Social Media to Obtain Sexually Explicit PhotosRead the Press Release
CORPUS CHRISTI, Texas – A 42-year-old Dallas man has entered a guilty plea to sexual exploitation of a child, otherwise known as production of child pornography, announced U.S. Attorney Kenneth Magidson. Daniel Fredrick Heidemann admitted to posing as a young male in order to elicit sexually explicit photos from a juvenile female.
The court heard today that in August 2014, authorities learned that a juvenile female had been communicating via cellular telephone text messages and several social media websites with an individual she believed was a juvenile male from Dallas. Heidemann was identified as the perpetrator and admitted to posing as a juvenile male and enticing the victim into sending him sexually explicit photographs of herself.
“While technology in this era is a wonderful tool for connecting with others, it can also a very dangerous place, especially for children,” said Magidson. “Adults, parents, older siblings and caregivers need to be vigilant in their efforts to protect our children online. We need to teach them about these dangers, with whom they could be communicating and what information should and should not be shared.”
Authorities executed a search warrant at Heidemann’s residence in Dallas and seized several electronic media storage devices. Forensic examination led to the discovery of several photographs of the juvenile female that were sexually explicit in nature.
U.S District Judge Nelva Gonzales Ramos accepted the guilty plea today and set sentencing for Nov. 20, 2015. At that time, Heidemann faces up a minimum of 15 and up to 30 years in federal prison as well as possible $250,000 fine. Upon completion of any prison term imposed, Heidemann also faces a maximum of life on supervised release during which time the court can impose a number of special conditions designed to protect and prohibit the use of the Internet.
Heidemann was arrested on the federal charges in March 2015 and has been in custody since that time where he will remain pending his sentencing hearing.
The charges are the result of an investigation by Homeland Security Investigations with the assistance of the Corpus Christi Police Department-Internet Crimes Against Children Task Force.
This case, prosecuted by Assistant U.S. Attorney Hugo R. Martinez, 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."
Convictions in Life Sentences for Valentino Bagola Upheld by the Eighth Circuit Court of AppealsRead the Press Release
FARGO - Acting U. S. Attorney Christopher C. Myers has announced that on August 6, 2015, the Eighth Circuit Court of Appeals affirmed the conviction and sentence of Valentino Bagola, 22, of St. Michael, ND. The grand jury indicted Bagola in July 2012, charging him with the deaths of 9-year-old Destiny Shaw and 6-year-old Travis Dubois, Jr., on the Spirit Lake Reservation. After a three-week trial, the jury found Bagola guilty of First-Degree Murder and U. S. District Judge Ralph R. Erickson sentenced Bagola to two life sentences, to be served concurrently. In its ruling, the Eighth Circuit Court of Appeals rejected every legal challenge raised by Bagola and determined that federal prosecutors had presented more than sufficient evidence establishing Bagola’s guilt.
Acting U.S Attorney Chris Myers said: "We are very pleased that the two life sentences given to Valentino Bagola for these horrible crimes were affirmed today by the Eighth Circuit Court of Appeals. The Court’s opinion provides some measure of justice for Destiny and baby Travis, their family, and the Spirit Lake community. Our continued commitment to public safety in Indian country is unwavering. Our skilled appellate team, led by AUSA Nick Chase, expertly drafted the appellate brief and navigated the oral argument with skill and professionalism – both critical to the positive result in this case."
Assistant U. S. Attorneys Clare Hochhalter, Janice Morley, Scott Schneider, and Acting United States Attorney Christopher Myers prosecuted the case; Assistant U. S. Attorney Nicholas Chase presented the appeal argument to the Eighth Circuit.
Company and Two Men Sentenced for Clean Water Act CrimesRead the Press Release
BINGHAMTON, NEW YORK – Mark Pullyblank, 54, of Caledonia, New York and William Clements, 54, of Victor, New York were sentenced yesterday for criminal violations of the Clean Water Act in federal court in Binghamton, New York, said United States Attorney Richard S. Hartunian and Vernesa Jones-Allen, Special Agent in Charge of U.S. Environmental Protection Agency’s criminal enforcement program in New York. Mark Pullyblank was sentenced to a 3 year term of probation, a $10,000 fine and 120 hours of community service. William Clements was sentenced to a 1year term of probation and a $2000 fine. Both men were employees of Crane-Hogan Structural Systems, Inc., Spencerport, New York, which also entered a corporate plea of guilty and was sentenced to pay a criminal fine of Five Hundred Thousand Dollars ($500,000) and was placed on a term of probation for 5 years. A condition of probation requires the company to develop, fund and implement a comprehensive Environmental Compliance Plan ("ECP") to prevent future violations.
As part of its guilty plea Crane-Hogan Structural Systems, Inc. admitted that in December 2008 and January 2009 during a hydro-demolition project at the Binghamton Governmental Center Parking Garage, in Binghamton, New York, it discharged concrete slurry into the Susquehanna River without a permit. Hydro-demolition results in the need to dispose of large quantities of waste concrete, concrete residue, and concrete slurry (concrete and water containing concrete sediments and/or high pH related thereto) William Clement was a project manager employed by Crane-Hogan Structural Systems, Inc. who supervised the negligent discharge of concrete slurry from hydro-demolition conducted within the Wilson Hospital Parking Garage, Johnson City, New York from May through July 2009, into a manhole that led to the Binghamton-Johnson City POTW.
Mark Pullyblank was a Project Manager employed by Crane-Hogan Structural Systems, Inc. who supervised the intentional discharge of concrete slurry from a hydro-demolition project at the Binghamton Governmental Center (BGC) Parking Garage, in Binghamton, New York in August and September 2009 into a BGC sub-basement sump that discharged to the storm sewer system and to the Susquehanna River.
"The illegal discharge of pollutants into the nation’s waters is a crime that has wide-ranging effects on the magnificent environment that is our shared legacy and violators will be held accountable under the law," said United States Attorney Richard S. Hartunian.
"America’s communities deserve clean water, free from pollutants in illegal wastewater discharges," said Vernesa Jones-Allen, Special Agent in Charge of EPA’s criminal enforcement program in New York. "For months, the defendants discharged contaminated wastewater in violation of the Clean Water Act. Protecting communities means holding violators accountable, both for illegal discharges and for failure to report them. It is appropriate that the company will be required to develop, fund, and implement an environmental compliance plan to ensure this type of illegal action doesn’t happen again."
The criminal investigation was conducted by the U.S. Environmental Protection Agency (EPA), Criminal Investigation Division and the New York State Department of Environmental Conservation, Bureau of Environmental Crimes Investigation.
Colombian Crime Syndicate Leader Sentenced to Prison for Role in Mediating Drug Money DisputesRead the Press Release
BOSTON – A leader of a criminal syndicate based in Medellín, Colombia, was sentenced today in U.S. District Court in Boston in connection with his role in a conspiracy to invest the proceeds from the sale of hundreds of kilograms of cocaine.
Fredy Alonzo Mira Perez, a/k/a Fredy Colas 49, of Medellín, Colombia, was sentenced by U.S. District Court Judge Douglas P. Woodlock to seven years in prison, three years of supervised release, a $25,000 fine, and forfeiture of $4 million. Mira Perez surrendered to U.S. law enforcement officials in Bogotá, Colombia in March 2015, and pleaded guilty to conspiracy to invest illicit drug profits in April 2015.
From approximately 2001 to September 2014, Mira Perez was a high-ranking member of La Oficina de Envigado (Oficina) a Colombia-based organized crime syndicate involved in the distribution of thousands of kilograms of cocaine from Colombia to locations worldwide, including the United States. Among other things, the organization served as a debt-collection agency for narcotics traffickers; controlled the flow of narcotics through Medellín and its surroundings; and invested in shipments of narcotics to the United States and elsewhere around the world. Members of Oficina have been known to employ kidnapping, violence, and extortion to achieve these ends.
As one of the leaders of Oficina, Mira Perez conspired with others to import cocaine into the United States and to invest the proceeds from those sales. For years, including from 2012 to 2014, Mira Perez’s served as Oficina’s principal debt collector. Mira Perez also was responsible for the collection of debts on behalf of other drug-trafficking organizations in Mexico and Colombia. These organizations contracted with Oficina to recoup missing drugs and drug proceeds. Among other things, Mira Perez adjudicated disputes regarding any drugs or drug money that was lost, stolen, or seized by law enforcement, and he conducted investigations to determine which parties would bear responsibility for the missing drugs and drug money. Mira Perez then set a repayment schedule. Mira Perez typically charged a forty-percent commission on behalf of Oficina for all recovered drug money, and he invested the commissions to fund the ongoing operations of Oficina.
This case is the result of an international undercover operation that was launched in Boston in 2011. The U.S. Drug Enforcement Administration (DEA) ultimately coordinated numerous undercover operations across the world and transferred millions of dollars, sometimes using the Black Market Peso Exchange in Colombia, in order to identify and prosecute criminal organizations like those led by Mira Perez.
According to the DEA, the larger investigation has led to seizure of approximately $15.2 million in illicit drug proceeds and the seizure in the United States and Colombia of approximately 3,970 kilograms of cocaine, 32,000 doses of MDMA (i.e., ecstasy), nine kilograms of methamphetamine, and 1,180 kilograms of marijuana, and the arrest of more than 60 Colombian nationals by Colombian law enforcement.
The investigation also resulted in the designation of multiple individuals and entities to the Specially Designated Nationals (SDN) list maintained by the Office of Foreign Assets Control (OFAC) within the U.S. Treasury Department. OFAC administers and enforces economic and trade sanctions against international narcotics traffickers. Many of the sanctions are based on United Nations and other international mandates, are multilateral in scope, and involve close cooperation with allied governments.
United States Attorney Carmen M. Ortiz; Michael J. Ferguson, Special Agent in Charge of the Drug Enforcement Administration, New England Field Division; William P. Offord, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; and John Smith, Director of the U.S. Treasury Department, Office of Foreign Assets Control, made the announcement today. The case was prosecuted by Assistant U.S. Attorney David J. D’Addio of Ortiz’s Narcotics and Money Laundering Unit.
Career Offender Sentenced to More than 12 Years in Prison for Trafficking Crack CocaineRead the Press Release
PROVIDENCE, R.I. – Richard Palmisano, 41, formerly of Central Falls, a career offender with a criminal history dating back more than twenty years, including convictions on drug trafficking, firearms and assault charges, was sentenced today to 150 months in federal prison for trafficking more than 90 grams of crack cocaine, announced United States Attorney Peter F. Neronha; Daniel J. Kumor, Special Agent in Charge of the Boston Field Division of ATF; and Central Falls Police Chief Colonel James J. Mendonca.
At sentencing, U.S. District Court Judge Mary M. Lisi also ordered Palmisano to serve five years supervised release upon completion of his prison term. Palmisano pleaded guilty on February 19, 2015, as charged in a six-count indictment to six counts of distribution of crack cocaine. No plea agreement was filed in this matter.
According to court records and information presented to the court, a joint investigation in the spring and summer of 2014 by ATF agents and Central Falls Police into Palmisano’s drug trafficking activities included five purchases of crack cocaine from Palmisano by an ATF undercover agent between April 24 and July 18. The purchases were of between 7.45 grams and more than 31grams for between $400 and $1,700.
Additionally, a court-authorized search of Palmisano’s residence, with the assistance of Rhode Island State Police and Providence Police, resulted in the seizure of 31 grams of crack cocaine which the undercover ATF agent had previously arranged to purchase from Palmisano.
Palmisano has been detained in federal custody since his arrest by ATF agents and Central Falls Police on August 7, 2014.
The case was prosecuted by Assistant U.S. Attorney Milind M. Shah.
Contact:
Jim Martin (401) 709-5357
email: [email protected]
on Twitter @USAO_RI
Canadian Marijuana Traffickers Convicted After TrialRead the Press Release
SYRACUSE, NEW YORK – On Wednesday, August 05, 2015, Canadian citizens Michael C. Woods and Gaetan Dinelle were convicted of multiple federal felony drug charges following a six day jury trial, announced United States Attorney Richard S. Hartunian. The defendants were found guilty of membership in three separate but related conspiracies, each involving 1,000 kilograms or more of marijuana destined for the United States. The jury also found both defendants guilty of being leaders of a continuing criminal enterprise (CCE), an ongoing, structured organization distributing marijuana over a period of years generating substantial income.
As a result of the CCE convictions, both Woods and Dinelle face the possibility of mandatory life imprisonment. Sentencing is scheduled for December 8, 2015, in Syracuse.
The evidence at trial showed that Woods, assisted by Dinelle, ran a vast international marijuana operation from Cornwall, Ontario, Canada, that operated from at least 2005 until 2008. During the trial, witnesses testified that Woods procured large quantities of marijuana from his sources in Canada and with Dinelle arranged for it to be smuggled across the border into the United States, where it was temporarily stored at various locations in Northern New York on the Akwasasne Mohawk Indian Reservation. From there the marijuana was driven by couriers who were selected and supervised by Woods and Dinelle to buyers throughout the Eastern United States.
Between 2006 and February 2008, law enforcement seized approximately $2,000,000 in currency that was marijuana proceeds and approximately 400 kilograms of marijuana from couriers working for Woods and Dinelle. Evidence during the trial included law enforcement estimates that the Woods organization distributed over 22,000 pounds of high-grade marijuana with gross wholesale receipts of $47,300,000 during the life of the conspiracy.
This prosecution in the United States followed the extradition of 15 individuals from Canada, including Woods and Dinelle, in the largest use of the extradition treaty between the two countries in a single case.
The trial witnesses included employees of the U.S. Drug Enforcement Administration (DEA) and DEA Northeast Regional Laboratory; the U.S. Department of Homeland Security, U.S. Border Patrol, Immigration and Customs Enforcement; the New York State Police and New York State
Police Forensic Investigation Center; the Massachusetts State Police and Massachusetts State Laboratory, the Warren County (New York) Sheriff’s Office, and the New Hampshire State Police Laboratory. The Royal Canadian Mounted Police also provided assistance throughout the investigation. The case was prosecuted by Assistant U.S. Attorney Carl G. Eurenius.
CEO of Chicago-Based Health Care Company Charged with Billing Medicare for Phony and Non-Existent Treatment of the Elderly in $1.2 Million SchemeRead the Press Release
CHICAGO — The chief executive officer of Chicago-based Home Physician Services LLC was arrested Thursday on charges that he billed Medicare for up to $1.2 million in fraudulent or non-existent services purportedly provided to the elderly and homebound.
HENRY SMILIE, 54, of Lake Zurich, was taken into custody Thursday morning. At the same time, federal agents executed search warrants at the Chicago and Schaumburg offices of Home Physician Services, where Smilie serves as chief executive officer. He was charged with Medicare fraud in a federal criminal complaint that was unsealed after his arrest.
The charges against Smilie are part of an ongoing investigation into a scheme to fraudulently increase Medicare bills for doctors of home health patients for care that did not qualify for reimbursement or simply wasn’t performed at all. According to a federal affidavit filed with the complaint, doctors employed by Smilie billed Medicare for treatment provided to elderly patients who were supposedly confined to their homes, enabling his company to claim physician fees for in-home treatment. In reality, the patients were not confined to their homes and thus were not qualified to receive the in-home services, according to the affidavit. From February 2012 to July 2014, Medicare paid Home Physician Services $1.2 million for Care Plan Oversight, the billing code for doctor supervision of treatment of a home-health patient, the affidavit states.
Smilie is scheduled to make an initial appearance at 2:00 p.m. this afternoon before U.S. Magistrate Judge Daniel G. Martin. The Medicare fraud count carries a maximum penalty of 10 years in prison, a $250,000 fine and mandatory restitution. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines.
The arrest and charges were announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Robert J. Holley, 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.
“Home health care fraud carries a very high price tag in our communities,” Mr. Fardon said. “Our partners at the federal, state and local level are committed to rooting out and combatting fraud, waste and abuse in the home health care system.”
According to the affidavit, Home Physician Services, whose principal office is located at 6002 N. Keating Ave. in Chicago, arranges in-home visits for elderly and homebound patients, and contracts with doctors who perform house calls and oversee the patients’ treatment plans. The physicians assign their bill-collecting rights to Home Physician Services, in return for being paid directly by the company. As part of the scheme, Smilie reported to Medicare that his physicians had performed services for the patients, when, in fact, little or no such treatment was rendered, the affidavit states.
According to the affidavit, federal agents have interviewed several current and former employees of Home Physician Services, including some who claimed to have reported fraudulent billing practices to Smilie before they were contacted by federal agents. One former employee, identified in the affidavit as “Individual F,” reported to agents that Smilie instructed him on how to complete the Care Plan Oversight paperwork so that the company could bill the maximum amount to Medicare – even if the treatment was not fully performed, the affidavit states. Another former employee of Home Physician Services – identified in the affidavit as “Individual H” – said the company performed a routine swab of each patient and then billed $1,000 to Medicare for each swab, according to the affidavit.
Individual F told agents Smilie stressed to employees that the minimum duration of the purported treatment needed to add up to 30 minutes, which is the barometer for triggering maximum payment by Medicare for certain Care Plan Oversight service, according to the affidavit. “Individual F told agents that Smilie instructed him to find whatever he could in the patient file to use to document the CPO, and if he did not find enough events to total 30 minutes, to just ‘make it up,’” the affidavit states.
The affidavit goes on to state that Individual F told agents that home-health agency workers from outside entities, such as nurses and therapists, called Smilie to get signed physician orders for treatment. Individuals F and H said they saw Smilie using rubber stamps of physicians’ signatures to create those orders, according to the affidavit. Individual F said that when he notified Smilie that the rubber stamping of physicians’ signatures may be illegal, Smilie “laughed and said that Home Physician Services’ CPO activities were also illegal,” the affidavit states.
As part of the investigation, a confidential source posed undercover as a 71-year-old Medicare recipient, according to the affidavit. Although able-bodied and not confined to his home, the confidential source was certified as homebound by Home Physician Services, the affidavit states. During secretly recorded visits by physicians from Home Physician Services, the confidential source is seen walking outside of his home to tend to his dogs, and explaining to the doctors that he enjoys gardening and visiting friends outside the home, the affidavit states. The confidential source received several house calls from doctors at Home Physician Services, who continued to certify him as homebound in bills submitted to Medicare.
The Medicare Fraud Strike Force began operating in Chicago in February 2011, and consists of agents from the FBI and HHS-OIG, working together with 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 announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. Defendants have been charged locally in health care fraud cases since the strike force began operating in Chicago.
The public is reminded that a complaint is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
The government is being represented by Assistant U.S. Attorney Renato Mariotti.
To report health care fraud or to learn more about the Health Care Fraud Prevention & Enforcement Action Team (HEAT), logon to: StopMedicareFraud.gov.
Complaint
Bradford Resident Pleads Guilty to Drug and Gun ChargesRead the Press Release
Contact: Joel B. Casey
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Harold Peters, III, 37, of Bradford, Maine pleaded guilty today in U.S. District Court to conspiring to distribute and possess with the intent to distribute bath salts and being a felon in possession of firearms.
According to court records, the defendant joined a conspiracy that distributed the “bath salt” Alpha-PVP in Penobscot County between January 2012 and March 2014. The defendant helped acquire Alpha-PVP from China; got distribution size quantities of it from other conspirators; distributed it to dealers and users in the Bangor area; collected drug proceeds from customers and delivered it to his suppliers; and used cellular telephones to coordinate the criminal activity.
In March 2014, the defendant illegally possessed two Winchester rifles that he purchased from another conspirator in exchange for Alpha-PVP. The defendant was prohibited from possessing firearms because he had previously been convicted of three felony offenses (unlawful sexual contact, trafficking in prison contraband, and failure to comply with sex offender registry act). The firearms were recovered from a family member’s residence where the defendant stored them.
On the drug charge, the defendant faces up to 20 years in prison, a $1,000,000 fine, and between three years and life of supervised release. On the gun charge, he faces up to 10 years in prison, a $250,000 fine and three years of supervised release. He will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
The case was investigated by the Maine Drug Enforcement Agency, the U.S. Postal Inspection Service, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the New Haven (Connecticut) Police Department.
Bossier City man sentenced to 10 months in prison for bankruptcy fraudRead the Press Release
SHREVEPORT, La. – United States Attorney Stephanie A. Finley announced today that a Bossier City man was sentenced to 10 months in prison for concealing his business assets during bankruptcy proceedings.
John M. Santoro, 43, of Bossier City, La., was sentenced by U.S. District Judge Elizabeth E. Foote on one count of concealment of assets in a bankruptcy proceeding. He was also sentenced to one year of supervised release. According to evidence presented at the April 7, 2015 guilty plea, Santoro filed for Chapter 7 bankruptcy protection on May 20, 2011, as the owner and for Santoro’s Catering Inc. After filing, Santoro had a third party sell a 2007 Dodge Ram 3500, which belonged to Santoro’s Catering Inc., and also sold some of the company’s catering equipment. Santoro failed to disclose the existence of the truck and the catering equipment to the bankruptcy trustee or list it on his bankruptcy petition. In bankruptcy proceedings, debtors are required to fully disclose all assets and liabilities.
The FBI conducted the investigation. Assistant U.S. Attorneys Brandon B. Brown and Cytheria D. Jernigan prosecuted the case.
Arizona Woman Sentenced to Six Years Jail in Identity Theft Tax Fraud CaseRead the Press Release
U.S. Attorney Richard S. Hartunian of the Northern District of New York and Acting Special Agent in Charge Thomas E. Bishop of the Internal Revenue Service-Criminal Investigations (IRS-CI) New York Field Office announced that Elaine Monique Zavalla-Charres, 34, of Winslow, Arizona, was sentenced yesterday in federal court in Utica, New York, in connection with her convictions for mail fraud and aggravated identity theft in a case involving false federal income tax returns that resulted in the theft of over $400,000 from the IRS. Zavala-Charres was sentenced to serve a total of 72 months in jail: 48 months for mail fraud and a consecutive term of 24 months for aggravated identity theft. She was also sentenced to serve three years of supervised release following her release from prison and ordered to pay restitution to the IRS in the amount of $411,309.
The fraud scheme occurred in 2011 through 2013. A co-defendant of Zavala-Charres, Lacey Hollinger, 27, of Massena, New York, contacted Massena-area residents via Facebook and other electronic media to tell them they were eligible for a tax refund, even though they were unemployed and had no income, as part of a U.S. government “stimulus program.” No such program existed. Several dozen responded, giving Hollinger their personal identification information (date of birth, social security number, etc.). Hollinger forwarded this information to Zavala-Charres, who used it to create false and fraudulent tax returns that, with others obtained from Arizona residents, generated over $400,000 in tax refunds. Zavala-Charres, Hollinger and others involved in the fraud scheme stole these funds after they were electronically deposited in bank accounts in Arizona.
The Massena-area residents never saw the tax returns, which falsely represented that they were self-employed and entitled to a refund. Some received pre-paid debit cards that Zavala-Charres directed to them through the U.S. mail. Many got nothing, with Zavala-Charres and Hollinger keeping most of the refund money. On May 22, 2013, IRS-CI special agents executed a search warrant at the former residence of Zavala-Charres in Phoenix resulting in the recovery of a computer used to create and file the fraudulent tax returns and numerous other documents used in the scheme.
Co-defendant Hollinger was sentenced on May 22, 2015, to serve a term of 36 months imprisonment, three years of supervised release and restitution.
“People who use identity theft to steal money by filing fake tax returns hurt honest taxpayers and cost the United States billions of dollars,” said U.S. Attorney Hartunian. “Cross-country crime connections cannot be allowed to evade the reach of the law. This was a serious crime warranting significant jail sentences and full restitution.”
“The Internal Revenue Service has made the investigation of individuals who orchestrate tax refund schemes using stolen identities a top priority,” said Acting Special Agent in Charge Bishop. “The sentence that Zavala-Charres received illustrates the consequences of committing this type of crime and how seriously the government is about prosecuting it. It will hopefully serve as a deterrent to others.”
The case was investigated by special agents of the IRS-CI Syracuse, New York, Field Office. The case was prosecuted by Assistant U.S. Attorney Richard Southwick of the Northern District of New York.
Arizona Woman Sentenced to Six Years Jail in Identity Theft Tax Fraud CaseRead the Press Release
SYRACUSE, NEW YORK –United States Attorney Richard S. Hartunian and IRS-Criminal Investigations, New York Field Office, Acting Special Agent in Charge Thomas E. Bishop announced that Elaine Monique Zavalla-Charres, 34, of Winslow, Arizona was sentenced yesterday in federal court in Utica, New York in connection with her convictions for mail fraud and aggravated identity theft in a case involving false federal income tax returns that resulted in the theft of over $400,000 from the IRS. Charres was sentenced to serve a total of seventy-two 72 months in jail: 48 months for mail fraud and a consecutive term of 24 months for aggravated identity theft. She was also sentenced to serve 3 years of supervised release following her release from prison and ordered to make restitution to the IRS of $411,309.
The fraud scheme which gave rise to the sentence occurred in 2011 through 2013. A co-defendant of Elaine Monique Zavalla-Charres, Lacey Hollinger, 27, of Massena, New York, contacted Massena area residents via Facebook and other electronic media to tell them they were eligible for a tax refund even though they were unemployed and had no income as part of a U.S. Government "stimulus program." No such program existed. Several dozen responded, giving Hollinger their personal identification information (date of birth, social security number, etc.). Hollinger forwarded this information to Charres, who used it to create false and fraudulent tax returns that, with others obtained from Arizona residents, generated over $400,000 in tax refunds. Charres, Hollinger, and others involved in the fraudulent scheme stole these funds after they were electronically deposited in bank accounts in Arizona.
The Massena area residents never saw the tax returns, which falsely represented that they were self-employed and entitled to a refund. Some received pre-paid debit cards that Elaine Monique Zavalla-Charres directed to them through the U.S. Mail. Many got nothing, with Charres and Hollinger keeping most of the refund money. On May 22, 2013, IRS-CI Special Agents executed a search warrant at the former residence of Charres in Phoenix, Arizona, resulting in the recovery of a computer used to create and file the fraudulent tax returns and numerous other documents used in the scheme.
Co-defendant Lacey Hollinger was sentenced on May 22, 2015 to serve a term of 36 months imprisonment, three years of supervised release and restitution.
United States Attorney Richard S. Hartunian stated, "People who use identity theft to steal money by filing fake tax returns hurt honest taxpayers and cost the United States billions of dollars. Cross-country crime connections cannot be allowed to evade the reach of the law. This was a serious crime warranting significant jail sentences and full restitution."
"The Internal Revenue Service has made the investigation of individuals who orchestrate tax refund schemes using stolen identities a top priority. The sentence that Ms. Zavala-Charres received illustrates the consequences of committing this type of crime and how seriously the government is about prosecuting it. It will hopefully serve as a deterrent to others," said IRS-Criminal Investigations in the New York Field Office, Acting Special Agent in Charge Thomas E. Bishop.
The case was investigated by Special Agents of the Internal Revenue Service, Criminal Investigations (Syracuse, New York Field Office). It was prosecuted by Assistant United States Attorney Richard Southwick.
Arch Coal Subsidaries to Make System-Wide Upgrades to Reduce Pollution Entering U.S. WatersRead the Press Release
The Department of Justice and Environmental Protection Agency (EPA) announced today that Arch Coal Inc., one of the nation’s largest coal companies, and 14 of its subsidiaries under the International Coal Group Inc. (ICG) have agreed to conduct comprehensive upgrades to their operations to ensure compliance with the Clean Water Act. The settlement resolves hundreds of Clean Water Act violations related to illegal discharges of pollutants at the companies’ coal mines in Kentucky, Pennsylvania, Maryland, Virginia and West Virginia. The states of West Virginia, Virginia and Pennsylvania are co-plaintiffs in today’s settlement. The companies will also pay a $2 million civil penalty.
“This joint enforcement effort, with three states, has resulted in a settlement that will require changes that will benefit the health and environment of Appalachian communities for many years to come,” said Assistant Attorney General John C. Cruden for the Environment and Natural Resources Division. “Under the terms of the agreement, Arch Coal and its subsidiaries will pay a significant penalty, improve their pollution control systems and provide for independent monitoring and data tracking that will make it a better company and a better neighbor to these communities.”
“Businesses have an obligation to ensure that their operations don’t threaten the communities they serve, especially those that are overburdened by or more vulnerable to pollution,” said Assistant Administrator Cynthia Giles for EPA’s Office of Enforcement and Compliance Assurance. “This settlement will prevent future environmental and public health risks by making sure these companies comply with federal and state clean water laws.”
“Today’s settlement is good news for water quality in the Appalachian region, especially people living in vulnerable and underserved communities,” said Regional Administrator Shawn M. Garvin for EPA. “It represents an important next step forward by requiring these companies to take necessary actions to reduce pollution from their mining operations.”
In addition to paying the penalty, under the proposed consent decree the companies must implement measures to ensure compliance and prevent future Clean Water Act violations, which will help protect communities overburdened by pollution, including:
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Developing and implementing a compliance management system.
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Periodic internal and third-party environmental compliance audits.
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Maintaining a data management system to track violations, water sampling data and compliance efforts.
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Providing training for environmental managers and others responsible for the consent decree.
Paying escalating stipulated penalties if violations continue to occur.
The government complaint filed concurrently with the settlement alleged that in the last six years, ICG operations have violated discharge limits for aluminum, manganese, iron and total suspended solids in their state-issued National Pollution Discharge Elimination System permits on more than 1,200 occasions, resulting in over 8,900 days of violations. Of those violations, 700 have been previously resolved by state enforcement actions in Kentucky and West Virginia.
EPA discovered the violations through inspections of ICG facilities and projects, reviewing various information provided by the companies and coordinating with the affected state governments.
The proposed consent decree, lodged in the U.S. District Court for the Southern District of West Virginia, is subject to a 30-day public comment period and approval by the federal court.
The proposed settlement will be available online at: http://www.justice.gov/enrd/consent-decrees
More information on Clean Water Act Enforcement: http://www.epa.gov/compliance/civil/cwa/index.html
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Albuquerque Man Pleads Guilty to Making Anti-Semitic Threats Against Businesswoman and is Sentenced to ProbationRead the Press Release
ALBUQUERQUE – An Albuquerque man entered a guilty plea to a misdemeanor hate crime arising out of anti-Semitic threats he made against a Jewish woman who owns and operates the Nosh Jewish Delicatessen and Bakery in Albuquerque. After Ng entered his guilty plea, he was sentenced to four years of probation.Ng was arrested by the FBI on March 7, 2014, on a criminal complaint charging him with interfering with the victim’s federally protected rights by threatening her and interfering with her business because of her religion and because she owned a Jewish restaurant.
Proceedings in the case were delayed during the pendency of competency proceedings. Ng remained in federal custody from the time of his arrest until the court found him competent in May 2015, at which time he was released on conditions that included supervision by the U.S. Pretrial Services Agency.According to the indictment filed on April 23, 2014, Ng posted threatening, anti-Semitic notes on the door of the victim’s business on Jan. 22, 2014, and Feb. 8, 2014. One of the notes read, “TO: The [racial slur] who should die.” Another read, “FROM: The one you scarred for life scumbags[;] TO: The [racial slur] who will die like rats.”
During today’s proceedings, Ng pled guilty to the second count of the indictment, and admitted posting anti-Semitic notes on the door of the victim’s business on Feb. 8, 2014. Ng acknowledged that he intentionally posted the notes knowing that or in reckless disregard of the fact that notes would be perceived as threatening. Ng also admitted that on Feb. 11, 2014, he told the FBI that he had a bad history with Jews and targeted the Nosh Jewish Delicatessen because he believed it was a good location to ensure that his message would reach as many Jews as possible.
This matter was investigated by the Albuquerque Division of the FBI and was prosecuted by Assistant U.S. Attorney Holland S. Kastrin of the U.S. Attorney’s Office for the District of New Mexico and Trial Attorney Angie Cha of the U.S. Department of Justice’s Civil Rights Division.
4 South Georgia Residents Indicted on Federal Drug Trafficking ChargesRead the Press Release
BRUNSWICK, GA – An Indictment returned by a federal grand jury sitting in Savannah in July and unsealed yesterday has charged 4 Georgia residents with conspiring to traffic cocaine and marijuana from 2014 to 2015 in the McIntosh, Glynn, Wayne, and Liberty County areas. The indicted defendants are:
Sterling Hunter “Tuffy” Bond, 53, from Townsend, Georgia,
Jeannette Bond, 48, from Townsend, Georgia,
Nik Kodros, 49, from Townsend, Georgia, and,
Lawrence Dewayne Floyd, 53, from Jesup, Georgia.
If convicted of the charged drug trafficking conspiracy charge, the defendants face a maximum of 20 years in prison and a $1 million fine.
Tuffy Bond, Jeanette Bond and Nik Kodros appeared in federal court in Brunswick yesterday for their initial appearances before U.S. Magistrate Judge R. Stan Baker. The Government asked that Tuffy Bond be detained pending trial; his detention hearing will be held on Monday in Brunswick. Kodros and Jeannette Bond were released yesterday on bond.
United States Attorney Edward Tarver emphasized that the indictments are only accusations and are not evidence of guilt. The defendants are entitled to a fair trial, during which it will be the Government’s burden to prove guilt beyond a reasonable doubt.
The charges resulted from a federal investigation by the FBI and the DEA, with assistance from the McIntosh County Sheriff’s Office and the Darien Police Department. Assistant United States Attorney Charlie Bourne is prosecuting the case on behalf of the United States. For additional information, please contact First Assistant United States Attorney James D. Durham at (912) 201-2547.
5 August 2015
Warren County, Kentucky Resident Guilty of Scheming with Others to File False Tax Returns to Obtain Fraudulent Tax RefundsRead the Press Release
Paid Mexican Nationals for Identification
Agreement includes $731,293.52 restitution
BOWLING GREEN, Ky. – A resident of Bowling Green, KY, pleaded guilty in U.S. District Court this week, before U.S. District Judge Greg N. Stivers, to charges of mail fraud and of entering into an agreement to defraud the Internal Revenue Service (IRS) by obtaining the payment of fraudulent claims, announced U.S. Attorney John E. Kuhn, Jr.
According to the plea agreement, Fernando Diaz Herrera conspired with others between June 23, 2010, and August 8, 2012 to defraud the IRS and U.S. Department of Treasury, by obtaining false claims. Specifically, Herrera paid Mexican Nationals, who lived outside the United States, for their means of identification, including birth certificates, immunization records and voter cards. The defendant and others then used these documents to obtain Individual Taxpayer Identification Numbers (ITIN). Herrera then used the ITINs to prepare and file fraudulent federal income tax returns – which caused federal income tax refunds to be dispersed. Herrera admits to cashing the fraudulent refund checks at financial institutions and businesses in Kentucky. Further, for the purposes of executing the scheme, Herrera admits to mail fraud when he caused a letter providing a falsely obtained ITIN to be sent from the IRS office in Austin, Texas, to an address in Bowling Green.
Herrera was charged by grand jury indictment, along with co-defendants Maria Chavez Salazar and Julio Ramos, on December 10, 2014.
If convicted at trial, Herrera could have been sentenced to a combined maximum term of 30 years in prison, fined $500,000 and served a three-year term of supervised release.
Sentencing is scheduled before Judge Stivers on November 23, 2015, in Bowling Green.
This case is being prosecuted by Assistant United States Attorney Amanda Gregory and is being investigated by the United States Secret Service.
U.S. Attorney General Loretta E. Lynch Meets with Attorneys General of All Central American NationsRead the Press Release
A Department of Justice official released the following background statement at the conclusion of Attorney General Loretta E. Lynch’s meeting with Attorneys General from all Central American nations:
“On Wednesday, Attorney General Lynch convened the first ever ‘Dialogue’ with the Attorneys General of all seven Central American nations: Belize, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama. The goal of the Dialogue is to strengthen law enforcement cooperation against the threats common to all our countries. The Attorneys General discussed enhanced coordination against transnational cartels, gangs and terrorists; the Dialogue also focused on the rapidly rising issue of cybercrime and the persistent problem of human trafficking and smuggling. Attorney General Lynch and her counterparts agreed that this meeting was only a first step and that these vital discussions would continue, so as to enhance citizen security both in Central America and the U.S.”
DELEGATION
Belize: Wilfred Peter Elrington, Attorney General and Minister of Foreign Affairs
Costa Rica: Jorge Chavarria Guzman, Attorney General
El Salvador: Luis Antonio Martinez Gonzalez, Attorney General
Guatemala: Thelma Aldana Hernandez, Attorney General
Honduras: Oscar Fernando Chinchilla Banegas, Attorney General
Nicaragua: Ana Julia Guido Ochoa, Attorney General
Panama: Kenia Porcell De Alvarado, Attorney General
U.S. Attorney Davis Announces Federal Indictments Resulting from Jackson Violent Crime InitiativeRead the Press Release
Jackson, Miss – Five individuals were indicted by a federal grand jury this week as part of a new Jackson Violent Crime Initiative aimed at reducing violent crime in the City of Jackson, announced U.S. Attorney Gregory K. Davis.
The following individuals were indicted by a federal grand jury on August 4, 2015:
Recardeo Harris, age 32, of Jackson, was charged with possessing a firearm on June 5, 2015, after having been previously convicted of a felony.
James Homan, age 33, of Jackson, was charged with possessing a firearm on June 22, 2015, after having been previously convicted of a felony.
Len Arthur Bracey, age 38, of Jackson was charged with possessing a firearm on December 29, 2013, after having been previously convicted of a felony.
Aarron Harris, age 29, of Byram, was charged with possessing a firearm on July 4, 2015, after having been previously convicted of a felony.
Maurice King, age 29, of Jackson, was charged with three counts of possessing a firearm on August 1, 2014, September 20, 2014, and March 2, 2015, after having been previously convicted of a felony.
The maximum penalty for possession of a firearm by a convicted felon is ten years in federal prison and a $250,000 fine on each count.
Additional defendants previously indicted as a result of the Jackson Violent Crime Initiative include:
Antonio Anderson, age 22, of Jackson, was indicted on May 20, 2015, for possession of a firearm by a convicted felon. He pled guilty on July 23, 2015, and will be sentenced on October 15, 2015. He faces a maximum penalty of ten years in prison and a $250,000 fine.
Jarvis Durr, age 22, of Crystal Springs, was indicted on May 20, 2015, for carjacking and brandishing a firearm during a crime of violence. He is currently scheduled for trial on November 3, 2015. If convicted, he faces a maximum penalty of fifteen years in prison for carjacking and a maximum of life in prison for brandishing a firearm during a crime of violence, and a maximum $250,000 fine on each charge.
Richard Barnes, age 29, of Byram, was indicted on June 23, 2015, for possessing a firearm on April 10, 2015, after having previously been convicted of a felony. He is currently scheduled for trial on September 1, 2015. If convicted, he faces a maximum penalty of ten years in prison and a $250,000 fine.
Ira McGruder, age 23, of Jackson, was indicted on June 23, 2015, for carjacking and brandishing a firearm during a crime of violence. He is scheduled for trial on September 1, 2015. If convicted, he faces a maximum penalty of fifteen years in prison for carjacking and a maximum of life in prison for brandishing a firearm during a crime of violence, and a maximum $250,000 fine on each charge.
Demario Webster, age 19, of Jackson, was indicted on June 23, 2015, for carjacking and brandishing a firearm during a crime of violence. He is scheduled for trial on September 1, 2015. If convicted, he faces a maximum penalty of fifteen years in prison for carjacking and a maximum of life in prison for brandishing a firearm during a crime of violence, and a maximum $250,000 fine on each charge.
The Jackson Violent Crime Initiative is a joint initiative between federal, state and local law enforcement agencies who are working together to reduce violent crime in the city of Jackson and to remove violent offenders from the streets of this community. The Initiative is an ongoing operation aimed at making the streets of Jackson and the surrounding communities safe for all citizens. Jackson Violent Crime Initiative partners include the Jackson Police Department, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Federal Bureau of Investigations (FBI), Drug Enforcement Administration (DEA), U.S. Marshals Service, Homeland Security Investigations, U.S. Postal Inspection Service, and U.S. Secret Service.
The public is reminded that an indictment is a formal charge that a defendant has committed a violation of the federal criminal laws. All defendants are presumed innocent unless and until proven guilty.
Two men sentenced in federal court for firearms chargesRead the Press Release
Evansville – Josh J. Minkler, the United States Attorney, announced today that two men were sentenced in federal court by U.S. District Chief Judge Richard L. Young for firearms charges.
“This office remains committed to keeping our neighborhoods safe by taking violent felons off our streets,” said Minkler. “Those individuals who choose to carry illegal firearms and live a life of crime should plan to spend a great deal of time in federal prison.”
Danyon Dowlen, 28, Clarksville, TN, was arrested in March 2013, on South Morton Street in Evansville on an outstanding warrant for murder from Clarksville, Tennessee. Federal, state and local law enforcement found Dowlen in a residence and when they knocked, he ran to the rear of the house. When the residence was cleared, officers found a fully loaded 9mm handgun in the house which belonged to Dowlen. He had multiple felony convictions from Montgomery County, Tennessee, which include aggravated assault, escape and several narcotics charges. Dowlen was sentenced to 10 years in prison.
Terronta Booker, 27, Evansville, was sentenced to 41 months after his conviction in May 2015, for being a felon in possession of a firearm. In September 2014, Booker was shot by an Evansville Police Officer after he was seen exchanging gunfire with another individual on South Kentucky Street. Booker threw a .380 caliber handgun down as officers pursued him. It was recovered a short time later. Booker has a felony conviction for armed robbery and criminal confinement from Vanderburgh County in 2010.
According to Assistant U.S. Attorney Lauren Wheatley who prosecuted this case for the government, Dowlen must serve five years of supervised release after serving their sentences; Booker must serve three.
Two Springfield Men Plead Guilty to Stealing Guns from Pawn ShopRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that two Springfield, Mo., men have pleaded guilty in federal court to stealing 23 firearms during a burglary at an Ozark, Mo., pawn shop.
Matthew James Oakley, 24, of Springfield, pleaded guilty today before U.S. District Judge M. Douglas Harpool to aiding and abetting in the theft of firearms from a licensed firearm dealer. Co-defendant Corey Lee Downard, 33, of Springfield, pleaded guilty to the same charge on Tuesday, Aug. 4, 2015.
Co-defendants Daryl Bradley Maples, 28, of Springfield, and Michael Cameron Heston, 26, of Republic, Mo., have pleaded guilty to the same charge. Maples was sentenced on April 16, 2015, to six years in federal prison without parole. The court also ordered Maples to pay $5,900 in restitution.
Oakley, Downard, Maples and Heston each admitted that they broke into Sutton Gun and Pawn, 3994 N. 20th St., Ozark, at 2:16 a.m. on Dec. 21, 2012. Maples admitted that he smashed out the glass from the front door. Then he, Maples and Downard went inside and took firearms from the display cases. Oakley admitted that he was the getaway driver during the robbery.
They stole 23 firearms and various amounts of ammunition. After the burglary, Oakley sped off with Maples, Heston and Downard to Maples’ residence, where they divided the spoils of the burglary and set up plans to exchange or barter the stolen firearms for cash or drugs. It was Oakley’s understanding that he would receive money from the sale of the guns for his role as the getaway driver.
When Maples was arrested on Dec. 26, 2012, he had in his possession two of the firearms that were stolen in the pawn shop burglary, an F.N. 9mm pistol and a Colt .38-caliber revolver, as well as assorted ammunition.
Under federal statutes, Oakley, Downard and Heston are each subject to a sentence of up to 10 years in federal prison without parole, plus a fine up to $250,000. 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 Bureau of Alcohol, Tobacco, Firearms and Explosives, the Ozark, Mo., Police Department and the Springfield, Mo., Police Department.
Two Men Sentenced and Another Pleads Guilty in Las Vegas for International Biofuels Fraud SchemeRead the Press Release
James Jariv, 64, of Las Vegas, Nevada, was sentenced in federal court in Las Vegas today to ten years in prison for his role in illegal schemes to generate fraudulent biodiesel credits and to export biodiesel without providing biodiesel credits to the United States. Jariv was also ordered to make restitution in the amount of $6,345,830.91 and to forfeit between $4 to $6 million in cash and other assets.
Jariv was the second defendant to be sentenced for the scheme. Nathan Stoliar, 64, of Australia, was sentenced to two years in prison in April for his role in the conspiracy and ordered to pay more than $1.4 million in restitution and to forfeit of $4 million in cash. In addition, in court papers unsealed last week, Alex Jariv, 28, also of Las Vegas, pleaded guilty in the scheme and his sentencing was scheduled for Aug. 18, 2015.
James Jariv and Stoliar both pleaded guilty to one count of conspiracy, one count of conspiracy to engage in money laundering, two counts of wire fraud and one count of making false statements under the Clean Air Act. Alex Jariv pleaded guilty to one count of conspiracy to commit wire fraud, make false statements and launder monetary instruments.
“This was an egregious scheme to defraud fuel suppliers, the United States, and a program designed to strengthen our nation’s petroleum independence and improve our air quality” said Assistant Attorney General John C. Cruden for the Justice Department’s Environment and Natural Resources Division. “We will not tolerate such fraud and will vigorously prosecute those who put their own enrichment above our nation’s interests.”
“Mr. Jariv and his co-defendant defrauded the United States government of millions of dollars through this biodiesel fraud scheme,” said U.S. Attorney Daniel Bogden for the District of Nevada. “They used a Las Vegas company and Las Vegas bank accounts to facilitate the scheme. Fortunately, in addition to convicting both defendants, we were able to seize and forfeit millions of dollars from numerous bank accounts, as well as real property in Nevada and California, jewelry and other assets.”
“EPA's criminal enforcement program goes after the most egregious offenders,” said Assistant Administrator Cynthia Giles for Enforcement and Compliance Assurance at EPA. “For his role in undermining the Renewable Fuel Standard, developed to reduce the nation’s impact on climate change and lessen our dependence on foreign oil, Mr. Jariv is going to prison. Let today’s sentence send a clear message to others who engage in biofuel fraud that EPA takes seriously its responsibility to bring violators of this important program to justice.”
The Energy Independence and Security Act of 2007 created a number of federally-funded programs that provided monetary incentives for the production and use of renewable fuels such as biodiesel in the United States. Biodiesel producers and importers can generate and attach credits known as renewable identification numbers (RINs) to the gallons of biodiesel they produce or import. Because certain companies (such as companies that sell transportation fuel in the United States) need RINs to comply with regulatory obligations, RINs have significant market value. They are routinely bought and sold in the marketplace. In addition, to ensure that RINs are generated for renewable fuel used only in the United States and in order to create an incentive for biodiesel in the United States to be used here, anyone who exports biodiesel is required to obtain these valuable RINs for all exported gallons and provide the RINs to EPA.
Beginning around September of 2009, James Jariv and Stoliar operated and controlled a company -- City Farm Biofuel in Vancouver, British Columbia, Canada -- that represented itself as a producer of biodiesel from “feedstocks” such as animal fat and vegetable oils. James Jariv and Stoliar also formed a company called Canada Feedstock Supply – that represented itself as City Farm’s supplier of feedstocks necessary to produce biodiesel. James Jariv operated and controlled a company based in Las Vegas called Global E Marketing (GEM).
Alex Jariv worked for and on behalf of these companies. Using these three and other closely-held companies, the three defendants claimed to produce biodiesel at the City Farm facility and to import and sell biodiesel to GEM and then generated and sold RINs based upon this claimed production, sale and importation. In reality, no biodiesel produced at City Farm was ever imported and sold to GEM as claimed. The Jarivs and Stoliar used GEM to claim to blend the biodiesel with petroleum diesel, allowing them to sell the RINs separately from any actual biodiesel. Using this scheme, the three men falsely claimed to import, purchase and blend more than 4.2 million gallons of biodiesel. They then sold the RINs, and fraudulently generated more than $7 million.
James Jariv and Stoliar also purchased and resold RIN-less B-99 biodiesel as B-100 biodiesel, which allowed them to charge substantially more for this product than if it has been accurately labeled. They exported significant amounts of the RIN-less B-99 they bought in the United States to Canada and Australia. They then sold the biodiesel in those countries and conspired to not acquire and provide RINs to the United States for these exports as they were required to do by law. In doing so, James Jariv and Stoliar failed to give to the United States RINs worth in excess of $34 million, keeping this money for themselves instead.
Finally, James and Alex Jariv and Stoliar conspired to launder the proceeds of their crimes, utilizing foreign banking institutions and complex financial transactions to promote their illegal schemes and distribute the proceeds of their crimes. Accounts were utilized in Canada, Nevada and Australia and transactions between the defendants’ closely-held companies were described as other legitimate transactions involving biodiesel, when in reality they were not.
The investigation into the Jarivs’ and Stoliar’s activities was the result of collaborative work by the EPA’s Criminal Investigation Division and the FBI, with assistance from the United States Secret Service, the Internal Revenue Service-Criminal Investigations, the Department of Homeland Security and the Royal Canadian Mounted Police.
The case was prosecuted by Wayne D. Hettenbach of the Environmental Crimes Section, U.S. Department of Justice, Assistant U.S. Attorneys Crane M. Pomerantz and Daniel D. Hollingsworth of the U.S. Attorney’s Office in Nevada and Assistant Deputy Chief Darrin L. McCullough of the Justice Department’s Criminal Division, Asset Forfeiture and Money Laundering Section, with the assistance of the Justice Department’s Office of International Affairs and the U.S. Attorney’s Office for the Southern District of Texas.
Two Men Sentenced and Another Pleads Guilty in Las Vegas for International Biofuels Fraud SchemeRead the Press Release
WASHINGTON – James Jariv, 64, of Las Vegas, Nevada, was sentenced in federal court in Las Vegas today to ten years in prison for his role in illegal schemes to generate fraudulent biodiesel credits and to export biodiesel without providing biodiesel credits to the United States. Jariv was also ordered to make restitution in the amount of $6,345,830.91 and to forfeit between $4 to $6 million in cash and other assets.
Jariv was the second defendant to be sentenced for the scheme. Nathan Stoliar, 64, of Australia, was sentenced to two years in prison in April for his role in the conspiracy and ordered to pay more than $1.4 million in restitution and to forfeit of $4 million in cash. In addition, in court papers unsealed last week, Alex Jariv, 28, also of Las Vegas, pleaded guilty in the scheme and his sentencing was scheduled for Aug. 18, 2015.
James Jariv and Stoliar both pleaded guilty to one count of conspiracy, one count of conspiracy to engage in money laundering, two counts of wire fraud and one count of making false statements under the Clean Air Act. Alex Jariv pleaded guilty to one count of conspiracy to commit wire fraud, make false statements and launder monetary instruments.
“This was an egregious scheme to defraud fuel suppliers, the United States, and a program designed to strengthen our nation’s petroleum independence and improve our air quality” said Assistant Attorney General John C. Cruden for the Justice Department’s Environment and Natural Resources Division. “We will not tolerate such fraud and will vigorously prosecute those who put their own enrichment above our nation’s interests.”
“Mr. Jariv and his co-defendant defrauded the United States government of millions of dollars through this biodiesel fraud scheme,” said U.S. Attorney Daniel Bogden for the District of Nevada. “They used a Las Vegas company and Las Vegas bank accounts to facilitate the scheme. Fortunately, in addition to convicting both defendants, we were able to seize and forfeit millions of dollars from numerous bank accounts, as well as real property in Nevada and California, jewelry and other assets.”
“EPA's criminal enforcement program goes after the most egregious offenders,” said Assistant Administrator Cynthia Giles for Enforcement and Compliance Assurance at EPA. “For his role in undermining the Renewable Fuel Standard, developed to reduce the nation’s impact on climate change and lessen our dependence on foreign oil, Mr. Jariv is going to prison. Let today’s sentence send a clear message to others who engage in biofuel fraud that EPA takes seriously its responsibility to bring violators of this important program to justice.”
The Energy Independence and Security Act of 2007 created a number of federally-funded programs that provided monetary incentives for the production and use of renewable fuels such as biodiesel in the United States. Biodiesel producers and importers can generate and attach credits known as renewable identification numbers (RINs) to the gallons of biodiesel they produce or import. Because certain companies (such as companies that sell transportation fuel in the United States) need RINs to comply with regulatory obligations, RINs have significant market value. They are routinely bought and sold in the marketplace. In addition, to ensure that RINs are generated for renewable fuel used only in the United States and in order to create an incentive for biodiesel in the United States to be used here, anyone who exports biodiesel is required to obtain these valuable RINs for all exported gallons and provide the RINs to EPA.
Beginning around September of 2009, James Jariv and Stoliar operated and controlled a company -- City Farm Biofuel in Vancouver, British Columbia, Canada -- that represented itself as a producer of biodiesel from “feedstocks” such as animal fat and vegetable oils. James Jariv and Stoliar also formed a company called Canada Feedstock Supply – that represented itself as City Farm’s supplier of feedstocks necessary to produce biodiesel. James Jariv operated and controlled a company based in Las Vegas called Global E Marketing (GEM).
Alex Jariv worked for and on behalf of these companies. Using these three and other closely-held companies, the three defendants claimed to produce biodiesel at the City Farm facility and to import and sell biodiesel to GEM and then generated and sold RINs based upon this claimed production, sale and importation. In reality, no biodiesel produced at City Farm was ever imported and sold to GEM as claimed. The Jarivs and Stoliar used GEM to claim to blend the biodiesel with petroleum diesel, allowing them to sell the RINs separately from any actual biodiesel. Using this scheme, the three men falsely claimed to import, purchase and blend more than 4.2 million gallons of biodiesel. They then sold the RINs, and fraudulently generated more than $7 million.
James Jariv and Stoliar also purchased and resold RIN-less B-99 biodiesel as B-100 biodiesel, which allowed them to charge substantially more for this product than if it has been accurately labeled. They exported significant amounts of the RIN-less B-99 they bought in the United States to Canada and Australia. They then sold the biodiesel in those countries and conspired to not acquire and provide RINs to the United States for these exports as they were required to do by law. In doing so, James Jariv and Stoliar failed to give to the United States RINs worth in excess of $34 million, keeping this money for themselves instead.
Finally, James and Alex Jariv and Stoliar conspired to launder the proceeds of their crimes, utilizing foreign banking institutions and complex financial transactions to promote their illegal schemes and distribute the proceeds of their crimes. Accounts were utilized in Canada, Nevada and Australia and transactions between the defendants’ closely-held companies were described as other legitimate transactions involving biodiesel, when in reality they were not.
The investigation into the Jarivs’ and Stoliar’s activities was the result of collaborative work by the EPA’s Criminal Investigation Division and the FBI, with assistance from the United States Secret Service, the Internal Revenue Service-Criminal Investigations, the Department of Homeland Security and the Royal Canadian Mounted Police.
The case was prosecuted by Wayne D. Hettenbach of the Environmental Crimes Section, U.S. Department of Justice, Assistant U.S. Attorneys Crane M. Pomerantz and Daniel D. Hollingsworth of the U.S. Attorney’s Office in Nevada and Assistant Deputy Chief Darrin L. McCullough of the Justice Department’s Criminal Division, Asset Forfeiture and Money Laundering Section, with the assistance of the Justice Department’s Office of International Affairs and the U.S. Attorney’s Office for the Southern District of Texas.
Three Tax Return Preparers Charged with Conspiracy and Preparing False Tax Returns at Tax Preparation Business with Multiple Locations in VirginiaRead the Press Release
Three tax return preparers were indicted today by a federal grand jury in Richmond, Virginia, on charges of conspiracy to defraud the United States and aiding and assisting in the preparation of false federal income tax returns, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney Dana J. Boente of the Eastern District of Virginia.
According to the allegations in the indictment, from around December 2011 to spring 2012, Erik Pittman, 35, Jeremy Blanchard, 35, and Corey Taylor, 25, operated three locations of a tax return preparation business known as Mo Money Taxes. The indictment alleges that the three men, along with others, created and inflated fictitious and fraudulent tax credits, including the Earned Income Credit and the American Opportunity Credit, to claim tax refunds that customers were not entitled to receive. All three defendants are charged with conspiracy to defraud the United States. Pittman is charged with six counts of assisting in the preparation of false federal income tax returns, Blanchard is charged with eight counts of assisting in the preparation of false federal income tax returns and Taylor is charged with five counts assisting in the preparation of false federal income tax returns.
If convicted, each defendant faces a statutory maximum sentence of five years in prison and a fine of $250,000 for the conspiracy count and a statutory maximum sentence of three years in prison and a $250,000 fine for each count of preparing false tax returns.
Acting Assistant Attorney General Ciraolo and U.S. Attorney Boente commended the special agents of IRS–Criminal Investigation, the FBI and the U.S. Postal Inspection Service, who investigated the case, as well as Assistant U.S. Attorney Stephen W. Miller of the Eastern District of Virginia and Trial Attorneys Todd P. Kostyshak and Kevin F. Sweeney of the Tax Division, who are prosecuting the case.
An indictment merely alleges that a crime has been committed, and the defendants are presumed innocent until proven guilty beyond a reasonable doubt.
Three Members of 2012 Presidential Campaign Staff Charged with Concealing Payments Made to State SenatorRead the Press Release
Three members of a 2012 presidential campaign committee were charged with offenses relating to the concealment of payments made to a former Iowa State Senator.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and Special Agent in Charge David J. LeValley of the FBI’s Washington, D.C., Field Office’s Criminal Division made the announcement.
“Federal campaign finance laws are intended to ensure the integrity and transparency of the federal election process,” said Assistant Attorney General Caldwell. “When political operatives make under-the-table payments to buy an elected official’s political support, it undermines public confidence in our entire political system.”
“Violating campaign finance laws by concealing payments to an elected official undermines our electoral system and deceives the public,” said Special Agent in Charge LeValley. “The FBI will aggressively investigate those who corrupt the integrity of our democratic process.”
Jesse R. Benton, 37, of Louisville, Kentucky; John M. Tate, 53, of Warrenton, Virginia; and Dimitrios N. Kesari, 49, of Leesburg, Virginia, are charged by indictment with conspiracy, causing false records to obstruct a contemplated investigation, causing the submission of false campaign expenditure reports to the Federal Election Commission (FEC) and engaging in a scheme to make false statements to the FEC. Benton is additionally charged with making false statements to the FBI, and Kesari is also charged with obstruction of justice.
Kesari appeared in the U.S. District Court for the Southern District of Iowa today. Benton and Tate are scheduled to appear on Sept. 3, 2015.
The defendants were members of a campaign for a candidate in the 2012 presidential election. According to allegations in the indictment, former Iowa State Senator Kent Sorenson initially supported one candidate in the 2012 presidential election, but between October and December 2011, secretly negotiated with the defendants to switch his support to their candidate in exchange for money. On Dec. 28, 2011, at a political event in Des Moines, Iowa, Sorenson publicly announced his switch of support.
The payments to Sorenson were allegedly made in monthly installments of approximately $8,000 each and ultimately amounted to over $70,000. The indictment alleges that the defendants concealed the payments by causing them to be recorded – both in campaign accounting records and in FEC filings – as campaign-related audio-visual expenditures, and by causing them to be transmitted to a film production company and then to a second company that was controlled by Sorenson. According to the indictment, the conspirators concealed their campaign’s payments to Sorenson from their candidate and also from the FEC, the FBI and the public.
The indictment further alleges that, in response to criticism of Sorenson’s change of support from one candidate to the other, the conspirators arranged for Sorenson to issue public statements denying allegations that he was offered money for his endorsement and noting that the campaign committee’s FEC filings would show that it made no payments to Sorenson.
On Aug. 27, 2014, Sorenson pleaded guilty to causing a campaign committee to falsely report its expenditures to the FEC and to obstruction of justice. He has not yet been sentenced.
The charges and allegations contained in an indictment are merely accusations. The defendants are presumed innocent until and unless proven guilty.
The case is being investigated by the FBI’s Washington, D.C., Field Office, with assistance from the Omaha, Nebraska, Field Office and the Des Moines Resident Agency. The case is being prosecuted by Director Richard C. Pilger of the Criminal Division’s Public Integrity Section’s Election Crimes Branch and Trial Attorney Jonathan I. Kravis of the Public Integrity Section.
Benton et al Indictment
Three Defendants Sentenced in Heroin ConspiracyRead the Press Release
U.S. Attorney Kenneth A. Polite announced that ARTHUR MCKINNIS, age 25, NARCISSE TROTTER, age 44, and AARONISHA LEWIS, age 26, all of New Orleans, were sentenced today for their roles in a heroin conspiracy. MCKINNIS pled guilty in March to conspiring to distribute at least one kilogram of heroin in the New Orleans area, and TROTTER and LEWIS pled to charges of using cell phones in furtherance of the heroin trafficking conspiracy.
U.S. District Judge Kurt D. Engelhardt sentenced MCKINNIS to 172 months in prison, to be followed by five years of supervised release, and a $100 special assessment. The Court sentenced TROTTER to 42 months in prison, to be followed by one year of supervised release, and a $200 special assessment. LEWIS was sentenced to 24 months in prison, to be followed by one year of supervised release, and a $100 special assessment.
On June 24, 2015, U.S. District Judge Engelhardt sentenced BOLDEN to 300 months in prison for heroin distribution and distribution of heroin resulting in an overdose death. NOEL JONES received a sentenced of 162 months in prison for distribution of heroin. TAYLOR, PERCY DEPRON, ERNEST DIAZ, and MELVIN SMITH are awaiting sentencing. THEODORE GRIFFIN and TREY MITCHELL are scheduled for trial on September 14, 2015.
According to court documents, the investigation of this trafficking organization included multiple court-authorized wiretaps by the Drug Enforcement Administration New Orleans Police Department High-Intensity Drug Trafficking Area group, including taps of cell phones used by dealers to communicate with suppliers, other co-conspirators, and customers. DEA worked together with agents of the Federal Bureau of Investigation to conduct numerous undercover purchases of heroin, surveillance operations, searches, witness debriefings, records analyses, and other investigative techniques to uncover and dismantle the heroin trafficking activities of the group.
The investigation showed that the defendants had been using a residence in New Orleans East as a base of operations to meet with heroin suppliers, maintain a heroin stash, and provide heroin to other dealers.
Numerous daily heroin customers also called the ‘dope’ phones used by these defendants every day to order heroin. Typically one of the dealers would answer these calls, ask the caller how much heroin he or she wanted to buy, and direct the caller to drive to a gas station or other commercial location in the New Orleans East neighborhood. Through subsequent calls and then visual contact between the customer and dealer, the dealer would direct the customer to rendezvous in a parking lot or on a side street near the commercial location to conduct the heroin sale.
According to the record, in July 2013, a court-authorized wiretap of the ‘dope’ phone used by defendant TERENCE TAYLOR intercepted a series of calls relating to the sale of heroin to a person who had recently been through treatment for heroin addiction, and who died later that day as a result of a heroin overdose. Intercepted calls helped to demonstrate that TAYLOR negotiated this particular sale of heroin and that defendant MALCOLM BOLDEN subsequently met with the decedent to complete the sale.
U.S. Attorney Polite praised the work of the DEA New Orleans Police Department High-Intensity Drug Trafficking Area group, the FBI, and the ATF, with the assistance of the St. Tammany Sheriff’s Office, the St. Bernard Sheriff’s Office, and the Louisiana State Police in investigating this matter. Assistant United States Attorneys Michael B. Redmann and Mark A. Miller are in charge of the prosecution.
Texas man sentenced to more than 15 years in prison for traveling to Ohio to have sex with 13-year-old girlRead the Press Release
A Texas man was sentenced to more than 15 years in prison for traveling to Ohio in an attempt to have sex with what he believed to be a 13-year-old girl, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio.
Samuel E. Condo, Jr., 32, of Arlington, Texas, was sentenced to 188 months in prison by U.S. District Judge Benita Pearson. He pleaded guilty earlier this year to four counts: enticement, receipt and distribution of minors engaged in sexually explicit conduct, transportation of visual depictions of minors engaged in sexually explicit conduct and travel to engage in sexually explicit conduct.
From on or about October 20, 2014, through on or about October 24, 2014, in the Northern District of Ohio, Eastern Division, and elsewhere, Condo knowingly used facilities and means of interstate and foreign commerce, that is, a cell phone and a computer connected to the Internet, to attempt to persuade, induce, entice and coerce an individual who had not attained the age of 18 years, that is, a 13-year-old girl to engage in illegal sexual activity with him. He also knowingly distributed numerous computer files which files contained visual depictions of real minors engaged in sexually explicit conduct, according to court documents.
On October 24, 2014, in the Northern District of Ohio, Eastern Division, and elsewhere, Condo knowingly transported numerous computer files, which files contained visual depictions of real minors engaged in sexually explicit conduct. He also knowingly traveled in interstate commerce, from Texas to Ohio, for the purpose of engaging in illicit sexual conduct with another person, that is, a 13-year-old girl, according to court documents.
This case is being prosecuted by Assistant United States Attorney Michael A. Sullivan. The case was investigated by the Ohio Internet Crimes Against Children Task Force and the United States Secret Service.
Tax Defier Sentenced to Two Years in Prison for Failing to Pay Federal Taxes for More Than Seven YearsRead the Press Release
United States Attorney Andrew M. Luger today announced the sentencing of TAMI MAE MAY, 56, to two years in federal prison for failing to pay federal taxes for more than seven years. MAY pleaded guilty on June 9, 2014, to one count of obstruction of due administration of Internal Revenue laws. MAY was sentenced on August 4, 2015, before Senior Judge David S. Doty in U.S. District Court in Minneapolis, Minn.
According to the defendant’s guilty plea and documents filed in court, from 1998 through 2004, MAY failed to file any income tax returns for the excavating business she ran with her husband, despite that fact that the business earned substantial income during that time. When notified by the IRS in April 2005 that the business owed tax debt, penalties and interest, MAY embarked on an eight-year campaign of frivolous filings, in an effort to obstruct the administration of Internal Revenue laws.
According to the defendant’s guilty plea and documents filed in court, MAY filed a host of fake documents with the IRS, including a “zero income” tax return, Forms 1099-OID falsely claiming that her husband had made payments to various IRS Revenue Officers, falsely claiming that the Mays or their business had received “original issue discounts” and had “federal tax withheld” by various banks and credit card companies, and forms claiming that the Mays were not United States Citizens, but instead were permanent residents of the “Kingdom of Heaven.”
According to the defendant’s guilty plea and documents filed in court, MAY also made nonsensical tax-defier-scheme-related statements to the IRS, including that her social security number was her “corporate fiction’s” social security number, that her family’s business was a foreign trust of which she was the trustee, and that there is no such thing as money.
This case is the result of an investigation conducted by the Internal Revenue Service-Criminal Investigations.
Assistant U.S. Attorney Kimberly A. Svendsen prosecuted the case.
Defendant Information:
TAMI MAE MAY, 56
Anoka, Minn.
Convicted:
- Obstruction of due administration of Internal Revenue laws, 1 count
Sentenced:
- 2 years in prison
- 1 year supervised release
- $192,495 in restitution
###
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Seven Indicted for Unlawfully Obtaining Unemployment BenefitsRead the Press Release
St Louis, MO – Federal indictments were returned today against seven defendants who are accused of unlawfully obtaining unemployment benefits through the Missouri Division of Employment Security. In each case, the indictments allege that the defendants applied for and received unemployment benefits which they were ineligible to receive. In some cases, the defendants allegedly underreported their income in order to appear eligible for benefits to which they were not in fact entitled. In other cases, the defendants allegedly claimed they were available to work when they were incarcerated at the time they applied for benefits. In two cases, the defendants are alleged to have conspired with others in order to carry out their crimes. The fraudulent benefits obtained by the defendants are said to range from as little as $3,840 to as much as $24,821.
The defendants named in today’s indictments are identified as ROCKSANN COFFMAN, of St. Louis, Missouri; BELINDA GRIFFIN, of Florissant, Missouri; MARK DAVID McKAY, of St. Louis, Missouri; KIRA McLAUGHLIN, of St. Louis, Missouri; KELLI PRIOR, of Wright City, Missouri; KRISTOPHER PRIOR, of Wright City, Missouri; and BRYANT HENRY WATKINS, of Dallas, Texas.
If convicted, each count of theft of government property carries a maximum penalty of 10 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.
he cases are being investigated by the Missouri Division of Employment Services, and in some cases the U.S. Department of Labor and U.S. Postal Service-Office of Inspector General. Assistant United States Attorney Richard E. Finneran is handling the cases for the U.S. Attorney’s Office.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
Real Estate Investment Firm Owner Pleads Guilty to FraudRead the Press Release
PHILADELPHIA - Michael Goldner, 44, of Glen Mills, PA, pleaded guilty today to a wire fraud and tax evasion after bilking would-be investors. U.S. District Court Judge Gerald A. McHugh scheduled a sentencing hearing for November 16, 2015.
Goldner was an accountant who owned a real estate investment firm, Arcadia Capital Group, Inc., which he started in 2003 with three other people. Arcadia ceased operations in the 4th quarter of 2009 and was out of business since the first quarter of 2009. Prior to 2007 and continuing into 2009, Goldner solicited individuals to invest in various real estate investments. Goldner promised a promissory note to at least one victim which, he said, would provide for regular payments and “occasional payments on the side.” One victim invested $25,000 on July 25, 2008, via a wire from his self-directed IRA. That victim then received a promissory note. At the time of that investment, the Arcadia bank account was overdrawn. Immediately following that investment, Goldner repaid three earlier investors and made one payment to LG Financial, which held a mortgage on a property Goldner part owned. Records from the Arcadia bank account show that from 2007 until Goldner closed the account in 2009, nearly $10 million was withdrawn from the account with less than $1 million going toward possible real estate deals. The remaining funds went to Goldner, his associates, and prior investors.
Goldner also owned an interest in Settlement Funds, LLC, and handled the day to day business of the company. Records from the Settlement Funds LLC bank account, which Goldner used after closing the Arcadia account, through April 2010 show that Goldner used the majority of the funds in the account on himself, his associates, and prior investors.
Goldner also had three tax clients from whom he stole funds the clients gave him to forward to the IRS. The clients gave Goldner funds to pay their tax obligations to the IRS but, instead, Goldner used the funds for his personal and business expenses.
Goldner faces a maximum possible sentence of 25 years in prison, possible restitution to the victims of more than $6 million, a $200 special assessment, and up to three years of supervised release.
The case was investigated by Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation. It is being prosecuted by Assistant United States Attorney David J. Ignall.
Reading City Council President Admits Taking Bribe to Repeal Ethics LawRead the Press Release
PHILADELPHIA - Francisco Acosta, 39, of Reading, PA, pleaded guilty today to an information charging him with conspiracy to commit bribery offenses, announced United States Attorney Zane David Memeger. At the time of the offense and until this morning, Acosta was the President of Reading City Council.
Certain anti-corruption statutes were enacted in Reading, PA, to limit the influence of money on political candidates and public officials. Section 1012 of Reading’s Code of Ethics establishes limits on campaign contributions to candidates seeking public office in Reading and Section 1006(H) of the Code prohibits the awarding of “no-bid contracts” to donors who have given campaign contributions in excess of those limits. During the guilty plea hearing, Acosta admitted the following:
In the spring of 2015, Acosta conspired with a person identified as “Public Official #1” to repeal these restrictions before the May 19, 2015 primary election through a bribery scheme, in violation of federal criminal law. Public Official #1 was a Reading public official who had the power to sign into law ordinances that had been passed by City Council. Public Official #1 was also a candidate in the Democratic Party’s primary election, scheduled for May 19, 2015. Public Official #1 decided to offer Acosta an $1,800 “loan” to the campaign committee of Acosta’s ally ( “Public Official #2”), which would be “forgiven” upon Acosta successfully orchestrating a repeal of Sections 1012 and 1006(H). Acosta accepted the payment on April 10, 2015 and then, three days later, introduced legislation to eliminate certain restrictions in the Code of Ethics in accordance with Public Official #1’s wishes (“the repeal bill”). As agreed to by Public Official #1 and Acosta, the repeal bill would have repealed Section 1012 in its entirety, thereby eliminating the restrictions on campaign contributions and nullifying Section 1006(H)’s prohibition on awarding “no-bid contracts” to certain donors.
To conceal his participation in the scheme, Public Official #1 sought to finance any campaign contributions to Public Official #2 with funding from third parties. Public Official #1 also sought to offer Acosta additional funding for the campaign committee of Public Official #2 as a reward for Acosta successfully orchestrating the passage of the repeal bill, although only a single payment – an $1,800 check payable to the campaign of Public Official #2 (“the bribe check”) – was ever provided to Acosta. When Acosta took possession of the bribe check, he agreed that, in order to avoid scrutiny of his agreement with Public Official #1, neither Acosta nor Public Official #2 would deposit the bribe check until a later date.
Acosta attempted to persuade other members of City Council to pass the repeal bill before the primary election by falsely asserting that he was motivated solely by the best financial interests of Reading and by concealing that he had received the bribe check. Then, on April 21, 2015, Acosta made materially false statements to FBI agents who were investigating the bribery scheme. Acosta falsely denied that he had accepted a bribery offer from Public Official #1 and that he had ever possessed or received the bribe check. In fact, as Acosta well knew, he had previously agreed to Public Official #1’s bribery offer and still had possession of the bribe check at the time of his false statements to the agents.
Within 24 hours of his interview with FBI agents on April 21, 2015, Acosta took affirmative steps to withdraw from the conspiracy, all without alerting other members of the conspiracy of the FBI’s inquiry into this matter. Acosta then met with the government at his earliest opportunity in order to accept responsibility for his wrongdoing. Acosta subsequently absented himself from the vote on the repeal bill, which was defeated unanimously by the remaining members of Reading City Council.
“Elected officials have an obligation to provide their constituents with honest services,” said Memeger. “When officials sell their services, particularly to repeal anti-corruption legislation, as Acosta admitted here, they do tremendous damage to the integrity of our governmental system. This office remains committed to investigating and prosecuting public corruption at all levels of government.”
“When government officials agree to sell their services, they betray their constituents who rightfully expect high ethical standards,” said FBI Special Agent-in-Charge William F. Sweeney. “The FBI will continue to aggressively investigate allegations of public corruption, and work with our partners to ensure that those who violate their obligation to the public are held accountable.”
After accepting Acosta’s guilty plea, U.S. District Court Judge Juan R. Sanchez scheduled a sentencing hearing for November 18, 2015. Acosta faces a maximum possible sentence of five years in prison, a fine of up to $250,000, three years of supervised release, and a $100 special assessment.
This case is being investigated by the Federal Bureau of Investigation and the Internal Revenue Service Criminal Investigation. It is being prosecuted by Assistant United States Attorneys Joe Khan and Nancy Beam Winter.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Pitt County Behavioral Health Businessman Pleads Guilty to Defrauding Medicaid After Threatening to Kill WitnessRead the Press Release
WILMINGTON - United States Attorney Thomas G. Walker announced that yesterday in federal court, TERRY LAMONT SPELLER, 37, of Winterville, North Carolina, pleaded guilty to Health Care Fraud and Engaging in Monetary Transactions Involving Criminally Derived Property.
“Illegal schemes like this one waste tax dollars and divert funds that are supposed to go toward needed medical care. Our investigators and attorneys will continue to work closely with federal officials to fight health care fraud and recover the public’s money,” said North Carolina Attorney General Roy Cooper.
“Criminals such as Speller, who engage in healthcare fraud, are among the worst, enriching themselves at the expense of others,” said Thomas J. Holloman, Special Agent in Charge of Internal Revenue Service, Criminal Investigation. “IRS Criminal Investigation remains steadfast in our commitment to bring those that would engage in this type of criminal activity to justice.”
"Fraudulently billing for behavioral health services costs the Medicaid program millions of dollars each year and diverts precious resources from those who need it most," said Derrick Jackson, Special Agent in Charge of the U.S. Department of Health and Human Services Office of Inspector General in Atlanta. "The OIG and our law enforcement partners will continue to aggressively pursue these thieves to ensure they are held accountable."
The Criminal Information to which SPELLER pleaded guilty provides that between 2010 and 2015, TERRY LAMONT SPELLER was an individual doing business through various Outpatient Behavioral Health and Outpatient Health Service providers in Pitt County and surrounding areas. Through these providers, SPELLER recruited hundreds of Medicaid beneficiaries, mostly children, from various communities in Eastern North Carolina to receive alleged services compensable by Medicaid.
In 2010, North Carolina’s Division of Medical Assistance (DMA), which administers the Medicaid program in this state, began an investigation of one of SPELLER’s companies based upon allegations that the company was billing for services that were not actually rendered. When requested, SPELLER failed to provide records to support the services that were billed. As such, the company was suspended from further participation in Medicaid programs.
Although excluded from the Medicaid program, over the next several years SPELLER concocted various schemes to continue getting paid. The schemes included getting various other providers to bill the Medicaid program on his behalf and submitting a forged document to Medicaid in order for payments to be wired into a bank account controlled by SPELLER.
In total, SPELLER fraudulently caused in excess of $4 Million to be billed to Medicaid using another provider’s number for service not provided and caused the proceeds to be deposited into an account controlled by SPELLER. SPELLER used the proceeds of the false and fraudulent claims to fund various purchases, including a $20,000 check to purchase a Shelby Cobra automobile.
Prior to pleading guilty, SPELLER was arrested and detained for threatening to kill a witness if she spoke to law enforcement. SPELLER will remain detained until the time of his sentencing, which will occur later in 2015.
At sentencing, SPELLER faces up to 20 years in prison. The maximum term of imprisonment for Health Care Fraud is 10 years. The maximum term of imprisonment for Engaging in Transactions Using Fraudulent Proceeds is 10 years. SPELLER also faces up to 3 years of supervised release, $500,000 in fines, and an order of restitution for the full amount of the fraud.
The investigation of this case was conducted by agents of the North Carolina State Bureau of Investigation assigned to the Medicaid Investigations Division of the North Carolina Attorney General’s Office; The Internal Revenue Service - Criminal Investigation; and the United States Department of Health and Human Services Office of the Inspector General. The investigation and prosecution of this matter is being handled in a partnership between the United States Attorney’s Office for the Eastern District of North Carolina and the Medicaid Investigations Division of the North Carolina Attorney General’s Office.
Assistant United States Attorney William M. Gilmore of the Economic Crimes Division, and Special Assistant United States Attorney Daniel Spillman of the Medicaid Investigations Division of the North Carolina Attorney General’s Office, represent the United States.
Panama City Man Sentenced for Possessing Firearm as a Convicted FelonRead the Press Release
PANAMA CITY, FLORIDA –Sammie Lee Underwood III, 22, of Panama City, was sentenced to 120 months in prison for being a felon in possession of a loaded .380 caliber pistol. The sentence was announced by Pamela C. Marsh, United States Attorney for the Northern District of Florida.
At trial, the government presented evidence that, in May 2014, Panama City police officers were on patrol in the Glenwood neighborhood when Underwood, driving a white Chevrolet Tahoe, ran a stop sign. He then led the officers on a chase through the neighborhood. As officers finally approached Underwood’s still-moving vehicle, he jumped out and fled on foot. The driverless vehicle then collided with a residence on East 13th Court. Under the Tahoe’s driver seat, officers found the loaded firearm and baggies of crack cocaine, bath salts, and marijuana. Testimony from Florida Department of Law Enforcement Crime Laboratory analysts showed that DNA recovered from the firearm matched Underwood. Underwood was convicted in March 2015.
The case was investigated by the Panama City Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Florida Department of Law Enforcement. It was prosecuted by Assistant United States Attorneys Gayle E. Littleton and Katy D. Risinger.
The United States Attorney's Office for the Northern District of Florida is one of 94 offices that serve as the nation’s principal litigators under the direction of the Attorney General. The office strives to protect and serve the citizens of the Northern District of Florida through the ethical, vigorous, and impartial enforcement of the laws of the United States, to defend the national security, to improve the safety and quality of life in our communities through the protection of civil rights, and to protect the public funds and financial assets of the United States. To access available public court documents online, please visit the U.S. District Court for the Northern District of Florida website. For more information about the United States Attorney’s Office, Northern District of Florida, visit http://www.justice.gov/usao/fln/index.html.
For more information, contact: Amy Alexander, Public Information Officer
(850) 216-3854, [email protected]Pair of Philadelphians Charged with Counterfeiting SEPTA TransPassesRead the Press Release
PHILADELPHIA – Mark Cooper, 35, of Philadelphia, PA, was charged by indictment, unsealed today, in a conspiracy involving more than 2,000 counterfeit monthly passes for Southeastern Pennsylvania Transportation Authority (SEPTA), announced United States Attorney Zane David Memeger. Cooper is charged with conspiracy to commit access device fraud and possession of access device making equipment. Kimberly Adams, 35, of Philadelphia, PA, is charged by separate information, also unsealed today.
According to the indictment, between August 2013 and June 2015, Cooper conspired with Adams to produce and sell counterfeit SEPTA monthly TransPasses, which allow passengers to board SEPTA buses, trolleys and subway trains. Once Cooper created the counterfeit passes, he gave them to Adams who then met customers, predominately City of Philadelphia employees, inside and outside of City Hall and elsewhere, and sold the counterfeit passes, which normally sell for $91, for approximately $50. Cooper and Adams then split the proceeds. It is alleged that between August 2013 and June 2015, the defendants counterfeited and sold in excess of 2,000 monthly passes.
“This office will not tolerate fraud involving valuable government property,” said Memeger. “Those who counterfeit SEPTA passes, as the defendant allegedly did here, will be prosecuted and face serious criminal penalties.”
“We’re not going to let city employees siphon money away from one of the region’s public agencies—especially not in City Hall of all places,” said Philadelphia Inspector General Kurland. “Our administrative investigation into other employees who were involved in this conspiracy is ongoing.”
If convicted of all charges, the defendants each face a statutory maximum possible sentence of 20 years in prison, a fine of up to $500,000, four years of supervised release, and a $200 special assessment.
The case was initiated by the City of Philadelphia Office of the Inspector General, jointly investigated with the FBI and the SEPTA Office of the Inspector General. It is being prosecuted by Assistant United States Attorney Karen Marston.
An indictment or information is an accusation. A defendant is presumed innocent unless and until proven guilty.
Office on Violence Against Women Announces Online Resource Center for Institutions of Higher EducationRead the Press Release
The U.S. Department of Justice’s Office on Violence Against Women (OVW) today announced the launch of The Center for Changing Our Campus Culture (www.changingourcampus.org), a new comprehensive online clearinghouse on sexual assault, domestic violence, dating violence, and stalking on campus. This new website provides the latest information, materials and resources for campus administrators, faculty and staff, as well as campus and community law enforcement, victim service providers, students, parents and other key stakeholders to use to improve campus safety.
“The launch of this website reaffirms the department’s commitment to providing campuses with tools to develop and implement effective responses to sexual and dating violence on campus,” said Deputy Attorney General Sally Quillian Yates. “The department commends campus leaders for championing these issues and for their dedication to bringing about lasting changes on their campuses.”
Since the release of Not Alone: The First Report of the White House Task Force to Protect Students from Sexual Assault on Jan. 22, 2014, the Justice Department, in partnership with the Department of Education, has strengthened federal enforcement efforts and provided institutions of higher education with tools to help combat sexual assault and domestic violence on campus.
“Colleges and universities across the country are looking for resources to improve their response to sexual assault, domestic violence, dating violence and stalking on campus," said Principal Deputy Director Bea Hanson of the Office on Violence Against Women. "Visitors to the website will have access to cutting-edge tools, including sample policies, protocols, and best practices, that can be adapted and replicated on colleges and universities across the county."
Content for The Center for Changing Our Campus Culture website was provided by OVW and its Grants to Reduce Sexual Assault, Domestic Violence, Dating Violence and Stalking on Campus Program technical assistance providers, in partnership with the U.S. Department of Education, the U.S. Department of Health and Human Services and the Centers for Disease Control and Prevention.
The center will continue to work collaboratively to update and maintain the website and will seek guidance and input from campus-based experts, campus communities, and grassroots groups committed to ending sexual assault, domestic violence, dating violence and stalking.
Office on Violence Against Women Announces Online Resource Center for Institutions of Higher EducationRead the Press Release
WASHINGTON – The U.S. Department of Justice’s Office on Violence Against Women (OVW) today announced the launch of The Center for Changing Our Campus Culture (www.changingourcampus.org), a new comprehensive online clearinghouse on sexual assault, domestic violence, dating violence, and stalking on campus. This new website provides the latest information, materials and resources for campus administrators, faculty and staff, as well as campus and community law enforcement, victim service providers, students, parents and other key stakeholders to use to improve campus safety.
“The launch of this website reaffirms the department’s commitment to providing campuses with tools to develop and implement effective responses to sexual and dating violence on campus,” said Deputy Attorney General Sally Quillian Yates. “The department commends campus leaders for championing these issues and for their dedication to bringing about lasting changes on their campuses.”
Since the release of Not Alone: The First Report of the White House Task Force to Protect Students from Sexual Assault on Jan. 22, 2014, the Justice Department, in partnership with the Department of Education, has strengthened federal enforcement efforts and provided institutions of higher education with tools to help combat sexual assault and domestic violence on campus.
“Colleges and universities across the country are looking for resources to improve their response to sexual assault, domestic violence, dating violence and stalking on campus," said Principal Deputy Director Bea Hanson of the Office on Violence Against Women. "Visitors to the website will have access to cutting-edge tools, including sample policies, protocols, and best practices, that can be adapted and replicated on colleges and universities across the county."
Content for The Center for Changing Our Campus Culture website was provided by OVW and its Grants to Reduce Sexual Assault, Domestic Violence, Dating Violence and Stalking on Campus Program technical assistance providers, in partnership with the U.S. Department of Education, the U.S. Department of Health and Human Services and the Centers for Disease Control and Prevention.
The center will continue to work collaboratively to update and maintain the website and will seek guidance and input from campus-based experts, campus communities, and grassroots groups committed to ending sexual assault, domestic violence, dating violence and stalking.
New Orleans Man Sentenced for Maliciously Conveying False InformationRead the Press Release
U.S. Attorney Kenneth A. Polite announced that JAHVAR HOOKS, age 31, of New Orleans, was sentenced today after previously pleading guilty a one-count superseding Indictment charging him with maliciously conveying false information in violation of Title 18, United States Code, Section 844(e).
U.S. District Judge Lance Africk sentenced HOOKS to time served and a three-year term of supervised release. HOOKS has been in federal custody since his arrest on August 20, 2013. According to court records, from August 12, 2013 through August 19, 2013, HOOKS made in excess of forty telephonic bomb threats. Victims of these threatening phone calls include the Orleans Parish Criminal District Court and the New Orleans Municipal/Traffic Court along with schools, hotels, casinos, and other government buildings. In an interview with officers of the New Orleans Police Department, HOOKS admitted to making the telephone calls.
U.S. Attorney Polite praised the work of the Federal Bureau of Investigation in investigating this matter. Assistant United States Attorney Gregory M. Kennedy was in charge of the prosecution.
New Iberia man sentenced to 30 years in prison for producing child pornographyRead the Press Release
LAFAYETTE, La. – United States Attorney Stephanie A. Finley announced today that a New Iberia man was sentenced to 360 months in prison for videoing boys over the internet engaging in sexual activity.
Raymond F. Doyle III, 41, of New Iberia, La., was sentenced by U.S. District Judge Richard T. Haik on one count of producing child pornography. He was also sentenced to a lifetime of supervised release and ordered to pay $735.95 restitution. According to evidence presented at the April 16, 2015 guilty plea, Doyle began communicating with numerous boys in the summer of 2011 using the internet and the video streaming internet service Skype. Doyle caused one of the boys to engage in sex acts while being videoed using Skype. A search of Doyle’s home computer revealed evidence that Doyle had contact with more than 60 boys. In most cases, Doyle pretended to be a female in order to encourage the boys to communicate with him.
“This case shows that exploitation of children has severe consequences for those who engage in these depraved activities,” Finley stated. “This sentence will help keep this defendant from harming more children. I also want to thank the prosecutor and law enforcement agencies for their help in securing this prosecution. Protecting children from predators requires cooperation among law enforcement agencies.”
The U.S. Postal Inspection Service investigated the case. Assistant U.S. Attorney John Luke Walker prosecuted the case.
This case is part of Project Safe Childhood, a U.S. Department of Justice nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, visit www.projectsafechildhood.gov.
New Haven Man Sentenced to 37 Months in Federal Prison for Illegally Possessing Semi-Automatic RifleRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that ANTHONY REID, 26, of New Haven, was sentenced yesterday by Senior U.S. District Judge Warren W. Eginton in Bridgeport to 37 months of imprisonment, followed by three years of supervised release, for illegally possessing a firearm.
According to court documents and statements made in court, on October 20, 2014, REID was arrested on state narcotics warrants. On that date, New Haven Police officers searched a residence where REID had stayed the prior night and seized a Global Machine and Tool, model M70AB2 7.62 x 39 millimeter semi-automatic rifle. The firearm was loaded with 35 rounds of ammunition. The search also revealed approximately 147 grams of suspected marijuana.
REID has admitted that he possessed the firearm for approximately three weeks.
REID’s criminal history includes felony convictions for stealing a firearm and possession with intent to distribute a controlled substance. It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.
REID has been detained since his arrest. On April 30, 2015, he pleaded guilty to one count of possession of a firearm by a convicted felon.
This matter was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the New Haven Police Department. This case was prosecuted by Assistant U.S. Attorneys Jennifer Laraia and David Nelson.
Navajo Man Pleads Guilty to Discharging Firearm While Assaulting Four Indian Women and Two ChildrenRead the Press Release
ALBUQUERQUE – Jeffrey J. Franklin, 31, an enrolled member of the Navajo Nation who resides in Shiprock, N.M., pleaded guilty today in Albuquerque, N.M., to violating the federal firearms laws by discharging a firearm during an act of violence. Under the terms of his plea agreement, Franklin will be sentenced to ten years in federal prison.
Franklin was arrested in Aug. 2014, on a criminal complaint charging him with assault with a dangerous weapon and abusing a child by placing the child in a situation that could endanger the child’s life. The complaint alleged that Franklin committed these crimes on Aug. 9, 2014, on the Navajo Indian Reservation in San Juan County, N.M. According to the complaint, on Aug. 9, 2014, Franklin assaulted four Indian women and two Indian children by firing shots while inside the residence of one of the victims and by firing shots at the victims’ vehicles. Two children were inside one of the vehicles when Franklin shot at the vehicle.
Franklin was subsequently indicted on Nov. 19, 2014, and charged with four counts of assault with a dangerous weapon with intent to do bodily harm, negligently placing minors in a situation that endangered the children’s health, and two counts of using and discharging a firearm during and in relation to a crime of violence.
During today’s proceedings, Franklin pled guilty to one count of using and discharging a firearm during and in relation to a crime of violence.
This case was investigated by the Farmington office of the FBI and the Shiprock office of the Navajo Nation Division of Public Safety. Assistant U.S. Attorneys Novaline D. Wilson and Kyle T. Nayback are prosecuting the case.
The case was brought pursuant to the Tribal Special Assistant U.S. Attorney (Tribal SAUSA) Pilot Project in the District of New Mexico which is sponsored by the Justice Department’s Office on Violence Against Women under a grant administered by the Pueblo of Laguna. The Tribal SAUSA Pilot Project seeks to train tribal prosecutors in federal law, procedure and investigative techniques to increase the likelihood that every viable violent offense against Native women is prosecuted in either federal court or tribal court, or both. The Tribal SAUSA Pilot Project was largely driven by input gathered from annual tribal consultations on violence against women, and is another step in the Justice Department's on-going efforts to increase engagement, coordination and action on public safety in tribal communities.
Mo’ Money Tax Preparers Charged in Tax Return SchemeRead the Press Release
RICHMOND, Va. – Erik Pittman and Jeremy Blanchard, both 35 and from Memphis, Tennessee, and Corey Taylor, 25, of Richmond, were indicted by a federal grand jury today on charges of conspiracy to defraud the United States and aiding in the preparation of 19 false and fraudulent U.S. individual tax returns.
According to the indictment, Pittman, Blanchard and Taylor held themselves out as tax preparers for tax year 2011, operating three locations of a business known as Mo’ Money Taxes. The indictment alleges that the three men, along with others, created and inflated fictitious and fraudulent tax credits, including the Earned Income Credit and the American Opportunity credit, to claim tax refunds that customers were not entitled to receive.
If convicted, Pittman faces a maximum penalty of 23 years in prison; Blanchard 29 years; and Taylor 20 years. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Caroline Ciraolo, Acting Assistant Attorney General for the Department of Justice Tax Division; Thomas Jankowski, Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation (IRS-CI); Adam S. Lee, Special Agent in Charge of the FBI’S Richmond Field Office; and David G. Bowers, Acting Inspector in Charge of the U.S. Postal Inspection Service (USPIS), made the announcement after the indictment was returned by the grand jury.
This case was investigated by IRS-CI, the FBI’s Richmond Field Office, and the USPIS. Assistant U.S. Attorney Stephen W. Miller, and Department of Justice Attorneys Todd Kostyshak and Kevin Sweeney are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:15-cr-196.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.