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14 July 2015
Tampa Man Sentenced to 29 Years for Armed RobberyRead the Press Release
Tampa, Florida – Senior U.S. District Judge U.S. District Court Judge Susan C. Bucklew today sentenced Shamorcus Brandan Nesbitt (28, Tampa) to 29 years in federal prison for conspiracy to interfere with commerce by robbery, interference with commerce by robbery, carrying a firearm in furtherance of a crime of violence, and being a felon in possession of firearm and ammunition. Nesbitt was found guilty by a federal jury on February 12, 2015.
According to evidence presented at trial, law enforcement identified Nesbitt and England Alexander Wilson as suspects in several commercial armed robberies in the Tampa Bay area. On May 20, 2014, Nesbitt and Wilson robbed a Little Caesar’s Pizza in Tampa, Florida. After tracking Nesbitt and Wilson’s movements, investigators recovered items used in the robbery, including clothing, gloves, and the firearm. Ultimately, both Nesbitt’s and Wilson’s DNA was found on gloves used in the robbery.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Federal Bureau of Investigation, the Hernando County Sheriff’s Office, the Hillsborough County Sheriff’s Office, the Citrus County Sheriff’s Office, the Pasco County Sheriff’s Office, and the Tampa Police Department. It is being prosecuted by Assistant United States Attorney Carlton C. Gammons and Josephine W. Thomas.
This is another case prosecuted as a part of the Department of Justice’s “Project Safe Neighborhoods” Program - a nationwide, gun-violence reduction strategy. United States Attorney A. Lee Bentley, III, along with Regina Lombardo, Special Agent in Charge, ATF, is coordinating the Project Safe Neighborhoods effort here in the Middle District of Florida in cooperation with federal, state, and local law enforcement officials. It is also a part of ATF’s Frontline strategy to combat gun violence in communities.
TDCJ Parole Officer and Boyfriend Charged with Production of Child PornographyRead the Press Release
VICTORIA, Texas – Saralyn Ann Proschko, 46, of Victoria, and David Ray McGee, 47, of Wallis, have been charged in a criminal complaint with production of child pornography, announced U.S. Attorney Kenneth Magidson.
Both are currently in custody. Proschko will make her initial appearance before U.S. Magistrate Judge B. Janice Ellington at 2:00 p.m. today, at which time the government expects to request her continued detention pending further criminal proceedings. McGee is in state custody on related charges and is expected to be transferred to federal authorities and make an initial appearance before a U.S. magistrate judge in Houston in the near future.
According to the allegations, authorities with the Victoria Police Department (VPD) responded to the Texas Department of Criminal Justice (TDCJ) - District Parole Office in Victoria in reference to allegations of possession of child pornography. Officers met with Proschko and discovered an electronic video on her cellular telephone of a juvenile female engaged in a sexual act, according to the complaint. Further investigation led to the discovery and charging of Proschko’s boyfriend - McGee - in relation to the allegations.
If convicted, both face a minimum of 15 and up to 30 years in federal prison as well as a possible $250,00 fine.
The charges are the result of the investigative efforts of Homeland Security Investigations, Texas Attorney General’s Office - ICAC (Internet Crimes Against Children), Houston-Metro ICAC Task Force and the Victoria Police Department.
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."
Sheepsprings, N.M., Man Sentenced to Probation for Federal Misdemeanor Assault ChargeRead the Press Release
ALBUQUERQUE – Jeremiah Ray Johnson, 39, an enrolled member of the Navajo Nation who resides in Sheepsprings, N.M., was sentenced this morning in federal court in Albuquerque, N.M., to two years of probation for his misdemeanor assault conviction.
Johnson was indicted on Aug. 12, 2014, and charged with assault resulting in serious bodily injury. The indictment alleged that Johnson assaulted the victim in San Juan County, N.M, on April 3, 2013.
On Feb. 18, 2015, Johnson pled guilty to an information charging him with a misdemeanor assault charge. Johnson admitted that on April 3, 2013, while at a residence in Sheepsprings, N.M., he punched and stabbed a Navajo man with a knife during a fight. The victim required hospitalization as a result of his injuries.
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. Attorney Jacob Wishard is prosecuting this case.
Scranton Man Charged in Sex Trafficking ConspiracyRead the Press Release
HARRISBURG- The United States Attorney’s Office for the Middle District of Pennsylvania, announced the filing of a criminal information late yesterday charging a Scranton man with participating in a conspiracy to have a minor engage in prostitution.
According to United States Attorney Peter Smith, the information alleges that Justin Strait, age 26, conspired with others to use a minor female to engage in prostitution at various motels in Lackawanna and Luzerne Counties during February through August 2014.
The charge against Strait resulted from an investigation by Homeland Security Investigations and the Pennsylvania State Police.
The information alleges that Strait and/or his co-conspirators recruited the minor to engage in prostitution, rented motel rooms for purposes of prostitution, provided condoms to the minor, photographed the minor and posted advertisements for “escort services” on a website, provided illegal drugs to the minor, and acted as security during prostitution activities.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Assistant U.S. Attorney Francis P. Sempa is prosecuting the case.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law is life imprisonment, a term of supervised release following imprisonment, and a fine. There is also a mandatory minimum sentence of 10 years in prison. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Public Outreach Initiative Aimed at Reducing the Number of Firearms Found at Tulsa Airport Security CheckpointRead the Press Release
TULSA, Okla.—United States Attorney Danny C. Williams Sr. of the Northern District of Oklahoma and Federal Security Director Stephen Cortright for Oklahoma, announced today that they have begun a public outreach initiative to remind passengers that firearms and other dangerous items are prohibited at airport security checkpoints.
“Whenever TSA discovers a firearm at a security checkpoint, we alert law enforcement, and they make decisions about any criminal penalties,” said Director Cortright. “TSA also has the ability to assess a civil penalty, which can be as much as $11,000.”
In 2014, TSA officers intercepted 23 firearms at the security checkpoint at TUL. So far this year, TSA has discovered 19 firearms at TUL. United States Attorney Williams says, “We want to emphasize that possessing any type of firearm at the airport or attempting to carry such items on board aircraft, without following proper procedures, will not be tolerated in the Northern District of Oklahoma.”
Federal and state laws prohibit people from carrying guns into the sterile area of airports or onto planes, though passengers can legally travel with a firearm in a checked bag. The firearm must be unloaded, properly packed in a hard-sided, locked case, and declared to the airline at the ticket counter. Ammunition, firearm parts—including firearm frames, receivers, clips and magazines—are also prohibited in carry-on bags, but can be packed in checked bags.
Cases involving such violations can be prosecuted by either the Tulsa County District Attorney’s Office or the United States Attorney’s Office. Cases prosecuted federally as felonies, carry imprisonment up to 10 years and fines of up to $250,000.00. Cases may also be filed as a misdemeanor offense by either state or federal prosecutors.
For more information about how to properly pack a firearm in a checked bag, go to: http://www.tsa.gov/traveler-information/firearms-and-ammunition
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Prior Felon from Albuquerque Sentenced to Prison for Unlawful Possession of Firearms and AmmunitionRead the Press Release
ALBUQUERQUE – Stephen Tyler Dawe, 38, of Albuquerque, N.M., was sentenced today in federal court to 60 months in prison followed by three years of supervised release for being a felon in possession of firearms and ammunition.
Dawe was arrested in Oct. 2014, on a criminal complaint alleging that he unlawfully possessed an unregistered firearm and ammunition on Sept. 28, 2014, in Bernalillo County, N.M. Dawe subsequently was indicted on Oct. 7, 2014, and charged with unlawfully possessing a single shot 12 gauge weapon made from a shotgun and multiple rounds of ammunition. At the time, Dawe was prohibited from possessing firearms or ammunition because he previously had been convicted of shooting at or from a motor vehicle, receiving or transferring a stolen motor vehicle, and being a felon in possession of a firearm.
On Nov. 24, 2014, Dawe pled guilty to the indictment and admitted that on Sept. 28, 2014, he was a passenger in a vehicle and was in possession of the firearm which was located at his feet in the rear passenger floorboard where he was seated. Dawe also admitted that the firearm was loaded with ammunition and that he was carrying additional ammunition.
This case was investigated by the Albuquerque office of the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Albuquerque Police Department. Assistant U.S. Attorney Paul Mysliwiec prosecuted the case.
Philadelphia Man Charged with Tipping Tax Preparer to InvestigationRead the Press Release
PHILADELPHIA - Marcos Cruz-Diaz, 34, of Philadelphia, PA, was charged today by indictment with obstruction of justice for allegedly tipping off the target of an Internal Revenue Investigation, announced United States Attorney Zane David Memeger.
According to the indictment, Cruz-Diaz was a paid informant for several federal government agencies. In his capacity as an informant, Cruz-Diaz became aware of the Internal Revenue Service’s ongoing investigation of tax return preparers and employees of a tax preparation business with offices located in Philadelphia, Pennsylvania, and their intent to execute search warrants at the offices of the tax preparation business and to engage in an undercover operation.Cruz-Diaz knew someone who was involved in an intimate relationship with a tax return preparer associated with the targeted business and allegedly informed that person of the Internal Revenue Service’s plans.Cruz-Diaz subsequently met with that tax return preparer and allegedly demanded $2,000 for providing the tip. He allegedly offered to provide the tax return preparer with a list of 25 client files that were in the tax return preparer’s possession, that contained incriminating information, and to prepare a video that the tax return preparer could use as a defense, in exchange for an additional $25,000.
If convicted, Cruz-Dias faces a maximum statutory sentence of 25 years in prison, five years of supervised release, a $500,000 fine, and a $200 special assessment.
The case was investigated by the Internal Revenue Service-Criminal Investigation Division and is being prosecuted by Assistant United States Attorney Anita Eve.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Pennsylvania Man Sentenced to Federal Prison for Drug TraffickingRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Matthew R. Brown, a 34-year-old Scotland, Pennsylvania resident was sentenced by U.S. District Court Judge Yvette Kane to 84 months’ imprisonment for distribution of crack cocaine.
According to United States Attorney Peter Smith, Matthew Brown pleaded guilty in March 2015 to buying crack cocaine from suppliers in York, Pennsylvania and then distributing those drugs in Franklin County.
Brown was indicted by a federal grand jury in April 2014, following an investigation by the Pennsylvania State Police, the Franklin County Drug Task Force and the Federal Bureau of Investigation.
The case is being prosecuted by Assistant U.S. Attorney Meredith A. Taylor.
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Pennslyvania Corporation Pleads Guilty and Forfeits $1 Million for Harboring of Illegal AliensRead the Press Release
U.S. Attorney Kenneth A. Polite announced that M.D. BASCIANI AND SONS, INC., a corporation domiciled in Pennsylvania, pled guilty today to a one-count Bill of Information charging the company with harboring illegal aliens at the Red Hill Mushroom Farm in Independence, Louisiana.
U.S. District Judge Jay C. Zainey sentenced M.D. BASCIANI AND SONS, INC. to three years of probation and ordered that the company forfeit over $1 million in illegal proceeds that it obtained as a result of employing the illegal workers. The company was also ordered to comply with future immigration inspections and to provide training to its managers and employees with hiring authority about compliance with United States immigration laws.
According to court documents, M.D. BASCIANI AND SONS, INC. rehired several of the same workers under different names after an immigration inspection revealed that they were unauthorized to work in the United States. The company’s records showed that the illegal alien workers had been fired, but in reality, they continued to pick and grow mushrooms at the farm. The farm’s manager and another of its supervisory employees have already pled guilty to a pattern and practice of employing illegal aliens at the farm.
“It is important to ensure that all businesses are competing on a level playing field, and using illegal labor to increase profits will not be tolerated,” stated U.S. Attorney Polite. “We will insist that every dollar in illegal proceeds is forfeited so that this illegal conduct does not pay.”
"Companies that violate federal law by employing workers illegally 'under the table' gain an unfair advantage over businesses that play by the rules," said Cindy M. Johnson., acting special agent in charge of HSI New Orleans. "HSI is committed to investigating and seeking prosecution of illegal employment practices to protect the legitimate workers and businesses that support our nation’s economy."
U.S. Attorney Polite praised the work of the Homeland Security Investigations in investigating this matter. Assistant United States Attorney David Haller was in charge of the prosecution.
M.D. Basciani and Sons, Inc. Factual Basis.pdf (271.84 KB)
Peaks Island Woman Sentenced to 3 Years for Heroin Trafficking ConspiracyRead the Press Release
Contact: Daniel J. Perry
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced that Ashley Gross, 26, of Peaks Island, Maine, was sentenced today in U.S. District Court by Judge Nancy Torresen to 3 years in prison and 3 years of supervised release for conspiring to distribute and possess with intent to distribute heroin. Gross pleaded guilty on March 11, 2015.
According to court records, from at least March 2013 through November 2013, Gross was part of a drug trafficking organization that distributed heroin and cocaine base, also known as crack cocaine, from several residences in the Portland area. Conspirators brought heroin and crack cocaine from out-of-state suppliers to the residences. Conspirators fielded telephone calls from drug customers for the drugs. The drugs were delivered to customers by runners, including Gross, who met with customers and exchanged the drugs for money. Runners brought the drug proceeds back to the residence and they were thereafter sent to the out-of-state suppliers.This case results from a joint investigation conducted by U.S. Drug Enforcement Administration, the Maine Drug Enforcement Agency, and the Portland Police Department.
Owner of Mortgage Company Pleads Guilty to $64 Million Mortgage Fraud SchemeRead the Press Release
Co-Developer and Underwriter Also Plead Guilty
A Miami-area real estate developer and owner of a mortgage company, his business partner and a senior mortgage underwriter each pleaded guilty to a mortgage fraud scheme involving federally insured mortgages that caused losses of $64 million to the Federal Housing Administration (FHA). Including these defendants, 25 individuals have pleaded guilty to offenses related to this scheme to date.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer for the Southern District of Florida and Special Agent in Charge Nadine Gurley of the U.S. Department of Housing and Urban Development Office of Inspector General (HUD-OIG) made the announcement.
Hector Hernandez, 57, of Miami; Aleida Fontao, 62, of Miami; and Olga Hernandez, 58, of Lake Mary, Florida, each pleaded guilty to conspiracy to commit wire fraud affecting a financial institution. Hector and Olga Hernandez both pleaded guilty late yesterday, while Fontao pleaded guilty on July 7, 2015. As part of his plea, Hector Hernandez also agreed to forfeit $8 million, which amounts to his profits from the scheme.
Hector Hernandez’s mortgage company, Great Country Mortgage Bankers, specialized in mortgage loans that were insured by the FHA, a division of HUD, as part of a program designed to make homeownership more accessible to first-time buyers and borrowers with lower income and imperfect credit history. To qualify for these federally-insured mortgages, potential borrowers must meet certain income and other financial requirements. Under the program, HUD relies on lenders like Great Country to review and approve only those borrowers who meet the employment, income and other financial requirements needed to qualify for an FHA mortgage.
According to admissions made in connection with the guilty pleas, although most of Great Country’s potential borrowers did not qualify for the FHA-insured loans, Hector Hernandez and his business partner, Aleida Fontao, directed Great Country employees, including underwriter Olga Hernandez, to falsify important documents in the potential borrowers’ loan applications to make them appear qualified. In particular, Hector Hernandez and Fontao admitted to pressuring their employees to approve and close loans using earnings statements and verification of employment forms that made it appear as if the borrowers had higher incomes and more favorable work histories than they actually did, and documents falsely improving or explaining borrowers’ credit histories. As an underwriter responsible for reviewing and approving loan applications, Olga Hernandez admitted that she provided her coworkers with false information and that she endorsed the applications knowing that the borrowers did not actually qualify for the loans.
After Great Country closed the fraudulent loans, the company sold the loans to financial institutions for profit. In connection with their guilty pleas, the defendants admitted that they offered kickbacks to the borrowers in the form of cash back after closing, which payments were not disclosed during the loan application process in order to hide the payments both from HUD and from the financial institutions that purchased the loans from Great Country.
The vast majority of the borrowers on these fraudulent loans failed to meet their monthly mortgage obligations and defaulted on their loans. When these loans went into foreclosure, HUD, which had insured the loans, was required to pay the outstanding loan balances to the financial institution investors, resulting in substantial losses to the FHA of at least $64 million.
This case was investigated by HUD-OIG’s Miami Field Office. This is being prosecuted by Senior Litigation Counsel David A. Bybee and Trial Attorneys Michael T. O’Neill and William E. Johnston of the Criminal Division’s Fraud Section.
Owner of Mortgage Company Pleads Guilty to $64 Million Mortgage Fraud SchemeRead the Press Release
A Miami-area real estate developer and owner of a mortgage company, his business partner and a senior mortgage underwriter each pleaded guilty to a mortgage fraud scheme involving federally insured mortgages that caused losses of $64 million to the Federal Housing Administration (FHA). Including these defendants, 25 individuals have pleaded guilty to offenses related to this scheme to date.
U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, and Special Agent in Charge Nadine Gurley of the U.S. Department of Housing and Urban Development Office of Inspector General (HUD-OIG) made the announcement.
Hector Hernandez, 57, of Miami; Aleida Fontao, 62, of Miami; and Olga Hernandez, 58, of Lake Mary, Florida, each pleaded guilty to conspiracy to commit wire fraud affecting a financial institution. Hector and Olga Hernandez both pleaded guilty late yesterday, while Fontao pleaded guilty on July 7, 2015. As part of his plea, Hector Hernandez also agreed to forfeit $8 million, which amounts to his profits from the scheme.
Hector Hernandez’s mortgage company, Great Country Mortgage Bankers, specialized in mortgage loans that were insured by the FHA, a division of HUD, as part of a program designed to make homeownership more accessible to first-time buyers and borrowers with lower income and imperfect credit history. To qualify for these federally-insured mortgages, potential borrowers must meet certain income and other financial requirements. Under the program, HUD relies on lenders like Great Country to review and approve only those borrowers who meet the employment, income and other financial requirements needed to qualify for an FHA mortgage.
According to admissions made in connection with the guilty pleas, although most of Great Country’s potential borrowers did not qualify for the FHA-insured loans, Hector Hernandez and his business partner, Aleida Fontao, directed Great Country employees, including underwriter Olga Hernandez, to falsify important documents in the potential borrowers’ loan applications to make them appear qualified. In particular, Hector Hernandez and Fontao admitted to pressuring their employees to approve and close loans using earnings statements and verification of employment forms that made it appear as if the borrowers had higher incomes and more favorable work histories than they actually did, and documents falsely improving or explaining borrowers’ credit histories. As an underwriter responsible for reviewing and approving loan applications, Olga Hernandez admitted that she provided her coworkers with false information and that she endorsed the applications knowing that the borrowers did not actually qualify for the loans.
After Great Country closed the fraudulent loans, the company sold the loans to financial institutions for profit. In connection with their guilty pleas, the defendants admitted that they offered kickbacks to the borrowers in the form of cash back after closing, which payments were not disclosed during the loan application process in order to hide the payments both from HUD and from the financial institutions that purchased the loans from Great Country.
The vast majority of the borrowers on these fraudulent loans failed to meet their monthly mortgage obligations and defaulted on their loans. When these loans went into foreclosure, HUD, which had insured the loans, was required to pay the outstanding loan balances to the financial institution investors, resulting in substantial losses to the FHA of at least $64 million.
This case was investigated by HUD-OIG’s Miami Field Office. This is being prosecuted by Senior Litigation Counsel David A. Bybee and Trial Attorneys Michael T. O’Neill and William E. Johnston of the Criminal Division’s Fraud Section.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Nine Defendants Charged in International Stock Fraud ScamsRead the Press Release
ALEXANDRIA, Va. – An indictment was unsealed today charging nine defendants with offenses based on their roles in complex, international stock manipulation and money laundering schemes generating approximately $6.5 million in illicit proceeds.
Harold Bailey Gallison II, 57, of Valley Center, California; Anna Hiskey, 42, of Costa Rica; Michael Randles, 47, of Costa Rica; Roger Coleman, 79, of Las Vegas; Carl Kruse Sr., 75, of Miami; Carl Kruse Jr., 50, of Miami; Frank Zangara, 52, of Locust Valley, New York; Mark Dresner, 59, of Dix Hills, New York; and Charles Moeller, 46, of Sea Cliff, New York; were charged in an indictment filed June 24, 2015, and unsealed today in the Eastern District of Virginia.
The indictment charges Gallison, Hiskey, Kruse Jr. and Kruse Sr. with one count of conspiracy to commit wire fraud and one count of securities fraud in connection with a “pump-and-dump” securities manipulation scheme involving the common stock of Warrior Girl Corp., which was quoted on the Over-the-Counter (OTC) market under the ticker symbol WRGL. The indictment also charges Gallison, Hiskey, Zangara, Moeller and Dresner with one count of conspiracy to commit wire fraud and one count of securities fraud in connection with a pump-and-dump securities manipulation scheme involving the common stock of Everock Inc., which was quoted on the OTC market under the ticker symbol EVRN. In addition, the indictment charges Gallison, Randles, Hiskey and Coleman with one count of conspiracy to commit money laundering.
According to the indictment, the defendants artificially “pumped” or inflated the trading volume and price of the securities by touting business activities and deceptive revenue forecasts, and by engaging in coordinated trading activity to create the appearance of increasing market demand. The defendants then allegedly “dumped” or sold the securities at the inflated prices and laundered the proceeds from their scheme through bank accounts in the United States and overseas.
According to the allegations in the indictment, the scheme was facilitated through an offshore brokerage and money laundering platform controlled by Gallison that went by various names, including Sandias Azucaradas, Moneyline Brokers and Trinity Asset Services (collectively, Moneyline). The defendants allegedly used Moneyline to create nominee accounts in the names of shell companies, and used those accounts to conceal both the true source and ownership of the securities and the flow of funds.
The conspirators also allegedly took elaborate steps to hide their illegal conduct from law enforcement, including the use of proprietary internal chat and telephone systems. In a recorded call from 2010, Gallison told Randles that Moneyline maintained a private internal telephone system that did not go through a U.S. server on which he and Randles could hold “private conversation[s] that the Fed cannot get a wiretap on.” In another conversation with Randles, Gallison noted that Moneyline’s proprietary internal chat system, which did not retain records of chats, was better than an internet service provider because “if the Fed came in with a search warrant, they’d take your computer and it’d have your last ninety days’ worth of Yahoo messengers and Skype chats.”
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Leslie Caldwell, Assistant Attorney General of the Justice Department’s Criminal Division; and Andrew G. McCabe, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement.
This case was investigated by FBI’s Washington Field Office. The Securities and Exchange Commission, the Financial Industry Regulatory Authority and the Criminal Division’s Office of International Affairs also provided significant assistance. The case is being prosecuted by Assistant U.S. Attorneys James P. Gillis and Zachary Terwilliger of the Eastern District of Virginia, and Senior Trial Attorney N. Nathan Dimock of the Criminal Division’s Fraud Section.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:15-cr-178.
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.
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Nine Defendants Charged in International Stock Fraud ScamRead the Press Release
An indictment was unsealed today charging nine defendants with offenses based on their roles in complex, international stock manipulation and money laundering schemes generating approximately $6.5 million in illicit proceeds.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Dana J. Boente of the Eastern District of Virginia and Assistant Director in Charge Andrew G. McCabe of the FBI’s Washington D.C. Field Office made the announcement.
Harold Bailey Gallison II, 57, of Valley Center, California; Anna Hiskey, 42, of Costa Rica; Michael Randles, 47, of Costa Rica; Roger Coleman, 79, of Las Vegas; Carl Kruse Sr., 75, of Miami; Carl Kruse Jr., 50, of Miami; Frank Zangara, 52, of Locust Valley, New York; Mark Dresner, 59, of Dix Hills, New York; and Charles Moeller, 46, of Sea Cliff, New York; were charged in an indictment filed June 24, 2015, and unsealed today in the Eastern District of Virginia.
The indictment charges Gallison, Hiskey, Kruse Jr. and Kruse Sr. with one count of conspiracy to commit wire fraud and one count of securities fraud in connection with a “pump-and-dump” securities manipulation scheme involving the common stock of Warrior Girl Corp., which was quoted on the Over-the-Counter (OTC) market under the ticker symbol WRGL. The indictment also charges Gallison, Hiskey, Zangara, Moeller and Dresner with one count of conspiracy to commit wire fraud and one count of securities fraud in connection with a pump-and-dump securities manipulation scheme involving the common stock of Everock Inc., which was quoted on the OTC market under the ticker symbol EVRN. In addition, the indictment charges Gallison, Randles, Hiskey and Coleman with one count of conspiracy to commit money laundering.
The indictment alleges that the defendants artificially “pumped” or inflated the trading volume and price of the securities by touting business activities and deceptive revenue forecasts, and by engaging in coordinated trading activity to create the appearance of increasing market demand. The defendants then allegedly “dumped” or sold the securities at the inflated prices and laundered the proceeds from their scheme through bank accounts in the United States and overseas.
According to the allegations in the indictment, the scheme was facilitated through an offshore brokerage and money laundering platform controlled by Gallison that went by various names, including Sandias Azucaradas, Moneyline Brokers and Trinity Asset Services (collectively, Moneyline). The defendants allegedly used Moneyline to create nominee accounts in the names of shell companies, and used those accounts to conceal both the true source and ownership of the securities and the flow of funds.
The conspirators also allegedly took elaborate steps to hide their illegal conduct from law enforcement, including the use of proprietary internal chat and telephone systems. In a recorded call from 2010, Gallison told Randles that Moneyline maintained a private internal telephone system that did not go through a U.S. server on which he and Randles could hold “private conversation[s] that the Fed cannot get a wiretap on.” In another conversation with Randles, Gallison noted that Moneyline’s proprietary internal chat system, which did not retain records of chats, was better than an internet service provider because “if the Fed came in with a search warrant, they’d take your computer and it’d have your last ninety days’ worth of Yahoo messengers and Skype chats.”
The charges and allegations contained in the 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. The Securities and Exchange Commission, the Financial Industry Regulatory Authority and the Criminal Division’s Office of International Affairs also provided significant assistance. The case is being prosecuted by Senior Trial Attorney N. Nathan Dimock of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys James P. Gillis and Zachary Terwilliger of the Eastern District of Virginia.
Moneyline Indictment
Monroe County Man Sentenced to Eight Years in Prison for Multi-County Drug Trafficking ConspiracyRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that a 32-year-old Effort resident was sentenced by U.S. District Court Judge Robert D. Mariani to 96 months’ imprisonment for participating in a drug conspiracy that was responsible for distributing large quantities of heroin, cocaine and other drugs during a four-year time period in Monroe, Montgomery, and Berks Counties.
According to United States Attorney Peter Smith, Ramon Baez pleaded guilty in April 2015 to his involvement in regularly obtaining drugs from suppliers in Reading and New York, and distributing those drugs to other dealers in Reading and the Monroe County area.
Baez was indicted by a federal grand jury in March 2014, following an investigation by the Drug Enforcement Administration (DEA), Homeland Security Investigations, the Pennsylvania State Police, the Pennsylvania Attorney General’s Office, Berks County Detectives and Montgomery County Detectives.
Judge Mariani ordered Baez to be placed on three years of supervised release following his prison sentence. Baez must also pay a special assessment of $100.
The case was prosecuted by Assistant U.S. Attorney Francis P. Sempa.
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Michael Scott Ponce Charged with Violating Federal Firearms LawsRead the Press Release
ALBUQUERQUE – Michael Scott Ponce, 38, of Albuquerque, N.M., made his initial appearance in federal court this morning on a criminal complaint charging him with being a felon in possession of a firearm and ammunition. Ponce waived his right to a detention hearing and will be detained pending trial.
The federal charge against Ponce was announced by U.S. Attorney Damon P. Martinez, 2nd Judicial District Attorney Kari E. Brandenburg, Special Agent in Charge Thomas G. Atteberry of the Phoenix Field Division of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), and Chief Gorden Eden, Jr., of the Albuquerque Police Department (APD).
U.S. Attorney Damon P. Martinez said that this case is being prosecuted as part of a federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders for federal prosecution with the goal of removing repeat offenders from communities in New Mexico for as long as possible. Because New Mexico’s violent crime rates, on a per capita basis, are amongst the highest in the nation, New Mexico’s law enforcement community is collaborating to target repeat offenders from counties with the highest violent crime rates, including Bernalillo County, under this initiative.
“Taking armed felons off our streets is our primary mission,” said ATF Special Agent in Charge Thomas G. Atteberry. “I want to recognize the bravery of our agents and the officers of the Albuquerque Police Department for their commitment to pursuing dangerous armed felons.”
“The assistance of our federal law enforcement partners and the willingness of U.S. Attorney’s Office to pursue federal charges against repeat offenders are having a dramatic, positive impact in our city,” Albuquerque Police Chief Gorden Eden said. “Working together, we are sending a message to repeat offenders that violent crime will not be tolerated.”
The criminal complaint alleges that Ponce unlawfully possessed a firearm and ammunition on June 27, 2015, in Bernalillo County, N.M. According to the criminal complaint, on June 27, 2015, APD officers who responded to reports of a shooting in downtown Albuquerque observed a vehicle driven by Ponce as it struck another vehicle as Ponce allegedly attempted to flee from the area. APD officers pursued Ponce into a residential neighborhood where they took him into custody. As they were arresting Ponce, the officers allegedly observed a firearm cartridge in Ponce’s vehicle. Before they arrested Ponce, the APD officers observed Ponce throw an item from his vehicle, and later found a semiautomatic pistol in the area where they had observed Ponce throw the object.
According to court records, on June 27, 2015, Ponce was prohibited from possessing firearms or ammunition because he previously had been convicted of two counts of aggravated assaults with a deadly weapon, aggravated battery with a deadly weapon causing great bodily harm, and trafficking a controlled substance in the Second Judicial Court for the State of New Mexico in Bernalillo County. Ponce also had a prior federal conviction on a cocaine trafficking charge. At the time of his arrest on June 27, 2015, Ponce was on supervised release after having served a sentence of incarceration on the federal conviction.
Ponce was arrested on June 27, 2015, on related state charges and remained in state custody until July 13, 2015, when he was transferred to federal custody. The state charges against Ponce will be dismissed in favor of federal prosecution.
If convicted of the charge in the criminal complaint, Ponce faces a statutory maximum penalty of ten years in federal prison. If the court determines that Ponce is an armed career criminal, he faces an enhanced sentence of a mandatory minimum of 15 years in prison to a maximum of life imprisonment. Charges in criminal complaints are mere accusations. Defendants are presumed innocent unless found guilty in a court of law.
This case was investigated by the ATF office in Albuquerque and APD with assistance from the Bernalillo County Sheriff’s Office and the Second Judicial District Attorney’s Office. Assistant U.S. Attorney Paul Mysliwiec is prosecuting the case.
Members of a Major Portsmouth Heroin Trafficking Organization Arrested in Simultaneous Execution of WarrantsRead the Press Release
NORFOLK, Va. – Alonzo Outten, 35; Jerald Outten, 26; Jermaine Jones, 38; and Deyonta Hinton, 31, all from Portsmouth, Virginia, and Garnett Brown, 34, from Chesapeake, Virginia, were arrested today on federal conspiracy charges of manufacturing, distributing, and possession with intent to distribute heroin.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Mark R. Herring, Attorney General of Virginia; and John S. Adams, Special Agent in Charge of the FBI’s Norfolk Field Office, made the announcement after five federally charged individuals were arrested.
The Outten organization was indicted by a grand jury on July 8, 2015. In the early morning hours of July 14, 2015, search warrants were executed simultaneously on 14 properties in Portsmouth, Chesapeake, and Suffolk, Virginia, by more than 250 law enforcement officials from three states and the District of Columbia.
This case was investigated by the FBI’s Norfolk Field Office and the Chesapeake Police Department with the assistance of the Portsmouth Police Department, the Virginia State Police, and the Naval Criminal Investigative Service. Virginia Assistant Attorney General and Special Assistant U.S. Attorney John F. Butler, and Assistant U.S. Attorneys Joseph E. DePadilla and Andrew C. Bosse 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. 2:15-cr-80.
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McMechen roofing contractor sentenced for fraudRead the Press Release
WHEELING, WEST VIRGINIA – Roofing and general contractor Stephen J. Gretchen, 45, of McMechen, West Virginia, was sentenced today to 12 months and 1 day in prison for failing to report cash payments to his employees and fraudulently collecting insurance benefits for staged damage to his vehicle, United States Attorney William J. Ihlenfeld, II, announced.
Gretchen knowingly underreported the wages, tips, and other compensation that he paid to his employees. He paid certain employees in cash “off the books.” He filed quarterly tax returns which failed to report these cash payments and failed to withhold certain tax amounts on behalf of his employees. In the second quarter of 2011, Gretchen reported that he paid no wages, tips, or other compensation to his employees. In fact, he had paid approximately $22,880.00 to his employees.
Gretchen owned a 2011 Coachman Freedom Express camping trailer. An investigation revealed that he paid one of his employees to deliberately and repeatedly crash a dump truck into the trailer, causing damage that totally destroyed the camping trailer for insurance purposes. Gretchen filed a claim with his insurance company, but falsely reported that the damage was caused by a hit-and-run accident. The insurance company sent Gretchen a check for $27,776.85 via FedEx in June 2012.
Gretchen pled guilty in January 2015 to one count of “Filing a False Form 941, Employees’ Quarterly Federal Tax Return,” and one count of “Mail Fraud.”
Assistant U.S. Attorney Robert McWilliams prosecuted the case on behalf of the government. The Internal Revenue Service-Criminal Investigation, the United States Postal Inspection Service, and the West Virginia Offices of the Insurance Commissioner, Fraud Investigation Unit investigated.
U.S. District Judge John Preston Bailey presided.
Massachusetts Man Sentenced to over Seven Years in Prison for Interstate Transportation of Stolen PropertyRead the Press Release
U.S. Attorney Thomas E. Delahanty II of the District of Maine announced today that Lawrence Estrella, 65, of Worcester, Massachusetts, was sentenced today in U.S. District Court by Judge George Z. Singal of the District of Maine to 92 months in prison to be followed by three years of supervised release for interstate transportation of stolen property. Estrella pleaded guilty on Feb. 20, 2015.
According to court records and information from the sentencing hearing, in May 2013, six N.C. Wyeth paintings were stolen from a residence in Portland, Maine. In November 2014, Estrella transported four of the six stolen paintings to California in an effort to sell them. Law enforcement officers in California located his vehicle in the parking lot of a hotel in North Hollywood, California. Estrella’s room at the hotel was searched and a firearm was located, but no paintings were found.
On Dec. 19, 2014, law enforcement officers recovered the four stolen paintings from a pawn shop in Beverly Hills, California. The four recovered paintings are titled, “At a touch from Michael’s knife,” “The Unwrit Dogma,” “The Duel” and “John Brimblecombe.” The four recovered paintings are worth more than $1 million. Oscar Roberts, the man who used the stolen paintings to secure a loan from the Beverly Hills pawn shop, was prosecuted in the U.S. District Court of the Central District of California and was sentenced to 28 months in prison.
The remaining two stolen paintings, “The Encounter on Freshwater Cliff” and “Go, Dutton, and that right speedily,” have not yet been recovered.
This case results from a joint investigation conducted by the FBI’s Portland and Los Angeles offices, the Portland Police Department and the Los Angeles Police Department.
Massachusetts Man Sentenced to over Seven Years for Interstate Transportation of Stolen PropertyRead the Press Release
Contact: David B. Joyce
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced today that Lawrence Estrella, 65, of Worcester, Massachusetts, was sentenced today in U.S. District Court by Judge George Z. Singal to 92 months in prison to be followed by 3 years of supervised release for interstate transportation of stolen property. Estrella pleaded guilty on February 20, 2015.
According to court records and information from the sentencing hearing, in May 2013, six N.C. Wyeth paintings were stolen from a residence in Portland. In November 2014, Estrella transported four of the six stolen paintings to California in an effort to sell them. Law enforcement officers in California located his vehicle in the parking lot of a hotel in North Hollywood. Estrella’s room at the hotel was searched and a firearm was located, but no paintings were found.
On December 19, 2014, law enforcement officers recovered the four stolen paintings from a pawn shop in Beverly Hills, California. The four recovered paintings are titled: “At a touch from Michael’s knife,” “The Unwrit Dogma,” “The Duel,” and “John Brimblecombe.” The four recovered paintings are worth more than $1 million. Oscar Roberts, the man who used the stolen paintings to secure a loan from the Beverly Hills pawn shop, was prosecuted in the U.S. District Court for the Central District of California and was sentenced to 28 months in prison.The remaining two stolen paintings -- “The Encounter on Freshwater Cliff” and “Go, Dutton, and that right speedily” -- have not yet been recovered.
This case results from a joint investigation conducted by the Portland, Maine, and Los Angeles, California, offices of the Federal Bureau of Investigation; the Portland Police Department; and the Los Angeles Police Department.Man Sentenced to Eight Years in Prison for Conspiring with Former U.S. Consulate Official in Visa SchemeRead the Press Release
WASHINGTON – Binh Tang Vo, 41, an American citizen who had been living in Vietnam, was sentenced today to eight years in prison on charges of conspiracy to commit bribery and visa fraud, bribery of a public official, and conspiracy to commit money laundering, announced Acting U.S. Attorney Vincent H. Cohen, Jr. and Bill A. Miller, Director of the U.S. Department of State’s Diplomatic Security Service (DSS).
Vo pled guilty to the charges in March 2015 in the U.S. District Court for the District of Columbia. The plea agreement, which was contingent upon the Court’s approval, called for a prison sentence between six and eight years, as well as forfeiture of nearly $5.1 million. The Honorable Emmet G. Sullivan accepted the plea agreement and sentenced Vo accordingly today.
Vo was arrested on Sept. 24, 2013, at Washington Dulles International Airport and has been held without bond ever since.
According to a statement of facts in support of his guilty plea, Vo conspired with co-defendant Michael Sestak and others to obtain visas to the United States for Vietnamese citizens. Sestak was the Non-Immigrant Visa Chief in the Consular Section of the U.S. Consulate in Ho Chi Minh City, Vietnam from August 2010 to September 2012.
As outlined in the statement of facts, Vo and Sestak conspired with other U.S. citizens and Vietnamese citizens to advertise the scheme and recruit customers. Co-conspirators reached out to people in Vietnam and the United States and advertised the scheme by creating a website and by spreading the word through emails and telephone calls. The conspirators told potential customers that once the customers obtained a visa from the scheme, they could disappear, get married or return to Vietnam and be assured of receiving visas in the future.
Vo and his co-conspirators received biographical information and photographs from customers and assisted them with their visa applications. Upon submitting an application, the applicant would receive an appointment at the Consulate, be interviewed by Sestak, and approved for a visa. Applicants or their families generally paid between $30,000 and $60,000 per visa. Nearly 500 fraudulent visas were issued as a result of the conspiracy.
Applicants paid for their visas in Vietnam, or by routing money to co-conspirators in the United States. Vo admitted to receiving millions of dollars for arranging for Sestak to approve the visas. He ultimately moved some of the money out of Vietnam by using money launderers to move funds through off-shore banks. Co-conspirators also had money laundered through off-shore banks to bank accounts in the United States.
“Binh Vo conspired with a corrupt U.S. Consulate Official to collect bribes in exchange for issuing visas that allowed nearly 500 Vietnamese nationals to enter the United States,” said Acting U.S. Attorney Cohen. “Binh Vo and his family members recruited bribe-paying customers by telling them that once in the United States they could disappear or get married. He collected millions of dollars in bribes by undermining the integrity of the process used to screen foreign visitors to our country. This prison sentence demonstrates our commitment to preserving the integrity of a process that is critical to our national security.”
“The U.S. visa is one of the most coveted travel documents in the world. Foreign nationals who acquire visas fraudulently to enter the United States could do so in order to carry out any number of criminal activities, including terrorism,” said Director Miller. “This case demonstrates Diplomatic Security’s unwavering commitment to investigating visa fraud and ensuring that those who commit this crime are brought to justice.”
Sestak, 44, pled guilty in November 2013 to one count each of conspiracy to commit bribery and visa fraud and to defraud the United States, bribery of a public official, and conspiracy to engage in monetary transactions in property derived from illegal activity. He is scheduled to be sentenced July 1, 2015.
Hong Vo, 29, an American citizen, and Truc Thanh Huynh, 31, a Vietnamese citizen, also pled guilty to conspiring with Sestak and Binh Vo. Hong Vo is Binh Vo’s sister, and Truc Thanh Huynh is Binh Vo’s cousin. Hong Vo was sentenced in March 2014 to seven months in prison and three months of home detention. Truc Tranh Huynh was sentenced in February 2014 to 16 months of incarceration.
According to the statement of facts, fraudulent visas granted by Sestak were connected to an Internet Protocol (“IP”) address controlled by Hong Vo. Huynh allegedly participated in the visa scheme by obtaining documents necessary for the visa applications, collecting money and providing model questions and answers for visa applicants. Sestak also allegedly approved a visa for Huynh to the United States, the application for which was submitted by the IP address controlled by Hong Vo.
The case was investigated and prosecuted by the U.S. Department of State Diplomatic Security Service and Assistant U.S. Attorneys Brenda J. Johnson, Alessio D. Evangelista of the National Security Section, and Catherine K. Connelly and Jennifer Ambuehl of the Asset Forfeiture and Money Laundering Section, as well former Assistant U.S Attorneys Christopher Kavanaugh, and Mona N. Sahaf.
Lewiston Man Sentenced to over 10 Years for Drug Trafficking and Firearms OffensesRead the Press Release
Contact: David B. Joyce
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced that Paul Robinson, 33, of Lewiston, Maine, was sentenced today in U.S. District Court by Judge George Z. Singal to 121 months in prison to be followed by five years of supervised release for distributing cocaine base, also known as crack cocaine, conspiring to distribute crack cocaine, and possessing a firearm during and in relation to a drug trafficking crime. Robinson pleaded guilty on September 4, 2014.
Court records reveal that between early 2011 and September 2013, Robinson and others obtained crack cocaine in Massachusetts for distribution in the Lewiston area. On April 11, 2013, after Robinson distributed about an ounce of crack cocaine, law enforcement officers executed a search warrant at Robinson’s apartment in Lewiston. Among the items seized were crack cocaine, about $4,500 in cash, two firearms, video monitors attached to surveillance cameras facing the front of the building, and EBT cards in the names of five other people. In total, Robinson was held responsible for 2.73 kilograms of crack cocaine.
This case results from a joint investigation conducted by the Maine Drug Enforcement Agency, the U.S. Drug Enforcement Administration, the Maine State Police, the Lewiston and Auburn Police Departments, and the Androscoggin County Sheriff’s Office. This investigation is part of the ongoing effort of the Organized Crime Drug Enforcement Task Forces (OCDETF), a partnership between federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.Lawrence Heroin Ring ChargedRead the Press Release
BOSTON – Ten individuals in three states were charged in federal court yesterday with conspiracy to distribute heroin, in connection with a Lawrence-based heroin operation. The ten were charged in two related criminal complaints.
In the late night hours on Sunday, July 12, 2015, Juan Gonzalez-Arias, 31, Jerri Martinez-Tejeda, 31, Yoelly Carmenatty, 27, Michael Bate, 33, and Gilberto Alicea, 32, were arrested for conspiracy to distribute heroin. Another charged defendant, Lily Y. Solis, 28, is in custody in Oklahoma. One defendant, Alejandro Mendez, 31, is in state custody in Massachusetts. Three other defendants, Joel Jahamal Rougeau, 41, Saul Torres, and Hillsaydee Guzman, 31, remain fugitives.
These charges came after a lengthy investigation that culminated in the execution of two search warrants, one for the residence of Gonzalez-Arias, and another for the residence of Martinez-Tejeda and his wife, Carmenatty, in the late evening and early morning hours of July 12-13.
In the Martinez-Tejeda/Carmenatty residence, agents found over $500,000 in cash that was in the process of being counted and packaged. Federal agents also recovered two handguns, various items for the processing and packaging of narcotics, and approximately one kilogram of what is believed to be “cut,” a substance used to dilute the purity of heroin prior to sale. Additionally, agents recovered ledgers appearing to be part of the drug trafficking operation.
In the Gonzalez-Arias residence, agents recovered a firearm, 1.5 kilograms of suspected heroin and an additional $30,088 in cash.
The maximum sentence under the statute is life in prison, followed by supervised release for up to life, a $10,000,000 fine, and a $100 special assessment. Depending on the total amount of drugs recovered and whether a defendant is held responsible for all or a portion of those drugs, the applicable statute also provides a ten year mandatory minimum period of incarceration as well as a mandatory five year period of supervised release. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz; and Michael J. Ferguson, DEA Special Agent in Charge, made the announcement today. The case is being prosecuted by Thomas E. Kanwit of Ortiz’s Narcotics and Money Laundering Unit.
The details contained in the criminal complaints are allegations. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Laguna Pueblo Man Sentenced to Probation for Federal Misdemeanor Assault ChargeRead the Press Release
ALBUQUERQUE – Lawrence Lockwood, 32, a member and resident of Laguna Pueblo, N.M., was sentenced today in federal court in Albuquerque, N.M., to two years of probation for his misdemeanor assault conviction.
Lockwood was arrested on Feb. 11, 2015, on a criminal complaint alleging that Lockwood assaulted his intimate partner on Jan. 5, 2015, during a domestic dispute by shoving her onto a bed and restricting her movement.
On April 22, 2015, Lockwood pled guilty to a misdemeanor information charging him with simple assault. In entering his guilty plea, Lockwood admitted that on Jan. 5, 2015, he forcefully pushed the victim at a location within the Pueblo of Laguna in Cibola County, N.M.
This case was investigated by the Laguna Agency of the BIA’s Office of Justice Services and the Pueblo of Laguna Tribal Police Department and was prosecuted by Assistant U.S. Attorneys Novaline D. Wilson and David Adams.
It 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.
Kings Mountain Man Sentenced to Nine Years for Armed Robbery of Fast Food Chain Restaurant in CharlotteRead the Press Release
CHARLOTTE, N.C. – U.S. District Judge Max O. Cogburn, Jr. sentenced today James William Lewis, Jr., 32, of Kings Mountain, N.C. to 108 months in prison for the armed robbery of a Charlotte-area fast food restaurant, announced Jill Westmoreland Rose, Acting U.S. Attorney for the Western District of North Carolina. Judge Cogburn also ordered Lewis to serve five years of supervised release and to pay $841 as restitution.
Acting U.S. Attorney Jill Westmoreland Rose is joined in making today’s announcement by John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Chief Kerr Putney, of the Charlotte-Mecklenburg Police Department.
According to filed court documents and today’s sentencing hearing, on December 12, 2013, Lewis robbed a Jack-in-the-Box restaurant, located at 7725 Pineville Matthews Road, in Charlotte.Court documents show that Lewis entered the restaurant and demanded that the manager give him money and threatened to shoot.According to court records, Lewis, who is a former employee of the Jack in the Box restaurant, took the manager back into the office and made him open the safe.Court records indicate that while the manager was opening the safe, Lewis removed a hand gun from under his jacket and proceeded to display and point the hand gun.Lewis then took the cash from the manager and fled the scene, court records show.
In May 2014, Lewis pleaded guilty to one count of Hobbes Act Robbery and one count of use and carry of a firearm in furtherance of a crime of violence, and the possession and brandishing of the firearm
Lewis, who is currently in federal custody, will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility.All federal sentences are served without the possibility of parole.
The investigation was handled by the FBI and CMPD. Assistant U.S. Attorney Robert Gleason, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.
Kennewick Man Sentenced to Thirty Years Imprisonment for Production of Child PornographyRead the Press Release
Spokane–Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that Sean Michael Challe, age 29, of Kennewick, Washington, was sentenced today for three counts of Production of Child Pornography. United States District Court Judge Salvador Mendoza, Jr. sentenced Sean Michael Challe to a thirty year term of imprisonment, to be followed by a lifetime of court supervision after he is released from federal prison. Challe will also be required to register as a sex offender.
According to information disclosed during the court proceedings, on September 20, 2014, in Richland, Washington, Challe was socializing with friends on a balcony when he went into their home, where their four year old daughter was sleeping. The father of the minor entered the home to find Challe standing over the minor whose pajamas were pulled town to expose her naked body. Law enforcement was called at that time.
Officers executed search warrants for Challe’s digital devices. Challe’s cellular phone contained photos and videos of the sleeping minor he had taken on September 20, 2014, which constituted child pornography. Challe also maintained photos and video of him molesting and performing oral sodomy on the same minor in June of 2014.
Also found on Challe’s devices were videos of him molesting a two year old male and an approximately nine month old female. Challe was also found to have recorded young boys urinating in two different public restrooms. Additionally, Challe possessed over 20,000 images of other child pornography, and he was found to have been actively trading child pornography via the internet.
Michael C. Ormsby stated, “Prosecuting those who would produce pornographic images of vulnerable minors is a priority of the United States Attorney’s Office for the Eastern District of Washington. Mr. Challe is a dangerous individual who preyed on very young, and thus, very vulnerable children.” He further stated, “This joint federal, state and local agency investigation demonstrates the dedication of the officers and the willingness to utilize resources at every level of law enforcement to bring those who would victimize children to justice.”
This case was pursued as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
This investigation was conducted by the Richland Police Department with assistance from the Federal Bureau of Investigation. The case was prosecuted by Laurel Holland, Deputy Prosecuting Attorney for Benton County and Alison L. Gregoire, an Assistant United States Attorney for the Eastern District of Washington.
Justice Department and Consumer Financial Protection Bureau Reach Groundbreaking Settlement to Resolve Allegations of Auto Lending Discrimination by HondaRead the Press Release
The Department of Justice and the Consumer Financial Protection Bureau (CFPB) announced today a groundbreaking settlement to resolve allegations that American Honda Finance Corporation (Honda) engaged in a pattern or practice of discrimination against African-American, Hispanic and Asian/Pacific Islander borrowers in auto lending. Honda is based in Torrance, California.
The settlement is especially noteworthy because of the company’s commitment to significantly limit the discretion of car dealers to charge interest rate markups on Honda loans. Specifically, Honda has agreed to change the way it prices its loans by limiting dealer markup to 125 basis points (or 1.25 percentage points) for loans of 60 months or less, and to 100 basis points (or 1 percentage point) for loans greater than 60 months. The settlement also provides $24 million in compensation for alleged victims of past discrimination by the nation’s ninth largest auto lender.
“We commend Honda for its leadership in agreeing to impose lower caps on discretionary markups and for its commitment to treating all of its customers fairly without regard to race or national origin,” said Vanita Gupta, head of the Civil Rights Division. “We recognize that dealerships perform a valuable service in connecting customers with lenders and that they should be fairly compensated for that service. We believe that Honda’s new compensation system balances fair compensation for dealers and fair lending for consumers. We hope that Honda’s leadership will spur the rest of the industry to constrain dealer markup to address discriminatory pricing.”
The coordinated investigations by the department and the CFPB that preceded today’s settlement determined this system of subjective and unguided pricing discretion directly results in Honda’s qualified African-American, Hispanic and Asian/Pacific Islander borrowers paying more than qualified non-Hispanic white borrowers. The department and CFPB anticipate that Honda’s new caps on discretionary markups will substantially reduce or eliminate these disparities.
Honda is known as an “indirect” auto lender because, rather than taking applications directly from consumers, the company makes most of its loans through car dealers nationwide who help their customers pay for their new or used car by submitting their loan application to Honda. Honda’s business practice, like most other major auto lenders, allows car dealers discretion to vary a loan’s interest rate from the price Honda initially sets based on the borrower’s objective credit-related factors. Dealers receive greater payments from Honda on loans that include a higher interest rate markup.
The settlement resolves claims by the department and the CFPB that Honda discriminated by charging thousands of African-American, Hispanic and Asian/Pacific Islander borrowers higher interest rates than non-Hispanic white borrowers. The agencies claim that Honda charged borrowers higher interest rates because of their race or national origin, and not because of the borrowers’ creditworthiness or other objective criteria related to borrower risk. The United States’ complaint alleges that the average African-American victim was obligated to pay over $250 more during the term of the loan because of discrimination, the average Hispanic victim was obligated to pay over $200 more during the term of the loan because of discrimination and the average Asian/Pacific Islander victim was obligated to pay over $150 more during the term of the loan because of discrimination. The Equal Credit Opportunity Act (ECOA) prohibits such discrimination in all forms of lending, including auto lending. Honda’s settlement with the Justice Department, which is subject to court approval, was filed today in the U.S. District Court of the Central District of California in conjunction with the Justice Department’s complaint. Honda resolved the CFPB’s claims by entering into a public administrative settlement.
“The CFPB is committed to creating a fair marketplace for all consumers, and other auto lenders should take note of today’s action,” said Director Richard Cordray of the Consumer Financial Protection Bureau. “Honda’s proactive decision to move to a new pricing and compensation system demonstrates industry leadership and represents a significant step towards protecting consumers from discrimination.”
“Honda’s financing practices that allowed dealerships to mark up individual loans resulted in illegal discrimination, with minority car buyers paying more for their loans than non-minority buyers with similar credit histories,” said U.S. Attorney Eileen M. Decker of the Central District of California. “This settlement provides for Honda to contribute $24 million to a settlement fund to provide redress for thousands of minority borrowers, not only in this district, where Honda’s United States operations are based, but throughout the country. It sends the clear message that discrimination of any kind is intolerable, and that other auto companies should follow Honda’s lead in taking steps to ensure that their sale and financing practices do not result in discrimination.”
In addition to the $24 million in payments for its past conduct, under the Justice Department consent order, Honda will also pay $1 million to fund a consumer financial education program focused on consumer auto finance that is designed to benefit African-American, Hispanic and Asian/Pacific Islander populations.
The settlement also requires Honda to improve its monitoring and compliance systems. The settlement allows the lender to experiment with different approaches toward lessening discrimination and requires it to regularly report to the department and the CFPB on the results of its efforts as well as discuss potential ways to improve results. The department commends Honda for working cooperatively to reach an appropriate resolution of this case.
The settlement provides for an administrator to locate victims and distribute payments of compensation at no cost to borrowers whom the department and the CFPB identify as victims of Honda’s discrimination. The department and the CFPB will make a public announcement and post information on their websites once more details about the compensation process become available. Borrowers who are eligible for compensation from the settlement will be contacted by the administrator, and do not need to contact the department or the CFPB at this time.
The Civil Rights Division, the U.S. Attorney’s Office of the Central District of California and the CFPB are members of the Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes. For more information on the task force, visit www.StopFraud.gov.
The department’s enforcement of fair lending laws is conducted by the Fair Lending Unit of the Housing and Civil Enforcement Section in the Civil Rights Division. Since the Fair Lending Unit was established in February 2010, it has filed or resolved 40 lending matters under the Fair Housing Act, ECOA and the Servicemembers Civil Relief Act. The settlements in these matters provide for a total of at least $1.2 billion in monetary relief for impacted communities. The Attorney General’s annual reports to Congress subject to ECOA highlight the department’s accomplishments in fair lending and are available at www.justice.gov/crt/publications.
Hudson County, New Jersey, Man Sentenced to 10 Years in Prison for Illegally Selling 33 FirearmsRead the Press Release
NEWARK, N.J. – A Jersey City, New Jersey, man was sentenced today to 120 months in prison for selling 33 firearms to a confidential informant, U.S. Attorney Paul J. Fishman announced.
Bernardo Guzman, 26, previously pleaded guilty before U.S. District Judge Madeline Cox Arleo to an information charging him with one count of possessing firearms while being a previously convicted felon. Judge Arleo imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
Guzman admitted that on Nov. 14, 2013, he met with an individual in the parking lot of a grocery store in Fort Lee, New Jersey, to illegally sell three handguns. Guzman also admitted that from June 2013 through February 2014, he sold approximately 33 firearms and hundreds of rounds of ammunition to a confidential informant. The firearms sold by Guzman consisted of semiautomatic weapons, sawed-off shotguns, assault-style rifles and firearms with high-capacity magazines. Some of the firearms had obliterated serial numbers. All of the weapons and ammunition are now in the custody of law enforcement.
In addition to the prison term, Judge Arleo sentenced Guzman to serve three years of supervised release.
The government is represented by Assistant U.S. Attorney Elizabeth M. Harris of the Organized Crime/Gangs Unit of the Criminal Division in Newark.
U.S. Attorney Fishman credited special agents of the Bureau of Alcohol, Tobacco, Firearms, and Explosives, under the direction of Special Agent in Charge George P. Belsky; special agents of Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), Newark Division, under the direction of Acting Special Agent in Charge Kevin Kelly; and the Jersey City Police Department with the investigation leading to today’s plea.
Defense counsel: Julian Wilsey Esq., Livingston, New Jersey
Hostage Taking Sends Three Men to Federal PrisonRead the Press Release
McALLEN, Texas ‐ Two Mexican nationals and a local resident have been handed significant sentences as a result of their convictions for conspiracy to commit hostage taking, announced U.S. Attorney Kenneth Magidson. Julio Vargas-Hernandez, 39, and Gustavo Morales-Manriquez, 32, pleaded guilty April 17, 2014, while Osiris Bulos-Gonzalez, 23, entered his plea on Oct. 29, 2014.
Today, U.S. District Judge Randy Crane sentenced all three men to a sentence of 262 months in federal prison. Bulos-Gonzalez will serve a three-year-term of supervised release following his sentence, while Vargas-Hernandez and Morales-Manriquez are expected to face deportation proceedings following completion of their prison terms. The sentences today were enhanced as the court took into consideration the fact that a firearm was used and a ransom demand was made. The court further found that the victims, who were citizens of Mexico, were particularly susceptible to this type of offense and took that into consideration when handing down the sentences.
On Feb. 9, 2014, law enforcement received a 911 call from an illegal alien claiming he and a group of other undocumented aliens were being held against their will at a stash house in Pharr. Upon their rescue, these individuals told law enforcement they were kidnapped at gunpoint from a stash house by the defendants and taken to the stash house where they were made to call their families and request money to be paid for their release. They were threatened with death if the money was not paid.
All three defendants have been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The investigation leading to the charges was conducted by Homeland Security Investigations, Border Patrol and Pharr Police Department. Former Assistant U.S. Attorney (AUSA) Juan Villescas prosecuted the case. AUSA Leo J. Leo III handled the sentencing hearing today.
Heber Springs Man Indicted on Multiple Counts of Sexual Exploitation of MinorsRead the Press Release
LITTLE ROCK – Christopher R. Thyer, United States Attorney for the Eastern District of Arkansas, and Cindy Johnson, acting special agent in charge of Homeland Security Investigations New Orleans, announced today the arrest of Spencer Goudy, 22, of Heber Springs, and the unsealing of an indictment against Goudy charging him with multiple counts related to the sexual exploitation of minors.
The seven-count indictment, returned by a Federal Grand Jury on July 7, 2015, charges Goudy with the sexual exploitation of five minors ranging in ages between 13 and 16 at the time of victimization. Goudy is charged with 4 counts of enticement of a minor to engage in a sex act, 2 counts of production of child pornography, and 1 count of possession of child pornography.
Homeland Security agents arrested Goudy on July 14, 2015. He is scheduled to appear before United States Magistrate Judge J. Thomas Ray on July 15, 2015. A trial date will be set at that time.
The investigation began in May 2014, when a 13-year-old female disclosed to the Arkansas State Police Crimes Against Children Division that she was having a sexual relationship with Spencer Goudy. Goudy was arrested and subsequently charged in Cleburne County with Rape of a Minor less than 14 years of age, a violation of Arkansas Code Annotated 5-14-103(a)(3)(A).
Upon Goudy’s arrest, a cellular telephone was seized and later searched pursuant to a federal search warrant. The search of Goudy’s cellular telephone revealed that Goudy was using his cellular telephone to entice multiple minor females to engage in sex acts. 425 West Capitol Avenue, Suite 500 (501) 340-2600 Post Office Box 1229 Little Rock, Arkansas 72203-1229 Further analysis of Goudy’s cellular telephone revealed multiple images of minors engaged in sexually explicit conduct.
“With the advancement of technology and social media, there are now countless ways children can be exploited,” Thyer said. “The arrest of Mr. Goudy today highlights that sad fact and should be another reminder to parents to keep an open dialogue with their children about their use of technology and social media. Our office will continue to prosecute individuals like Mr. Goudy who take advantage of and prey on the vulnerability of children.”
“Individuals who produce child pornography are directly responsible for what is, in plain language, the rape of children. These criminal acts steal the innocence of victims and destroy lives,” Johnson said. “Sexual abuse scars children for life, and HSI will continue to use all the tools in its arsenal to identify the perpetrators of these horrendous acts and seek justice on behalf of their victims.”
Goudy is also charged in White County with Rape of a Minor less than 14 years of age, a violation of Arkansas Code Annotated 5-14-103(a)(3)(A).
Enticement of a Minor to Engage in Sexual Activity, a violation of 18 U.S.C.§ 2422(b), carries a penalty of not less than 10 years to life imprisonment, not less than 5 years to life of supervised release, and a fine of up to $250,000.
Production of Child Pornography carries a penalty of not less than 15 years to life imprisonment, not less than 5 years to life of supervised release, and a fine of up to $250,000. Possession of Child Pornography carries a penalty of not more than 10 years imprisonment, not less than 5 years to life of supervised release, and a fine of up to $250,000.
This investigation was conducted by the Heber Springs Police Department, Arkansas State Police, and HSI. It is being prosecuted by Assistant United States Attorney Kristin Bryant.
An indictment contains only allegations. A defendant is presumed innocent unless and until proven guilty.
Hawaii Businessman Convicted of Federal Tax Crimes for Failing to Report Millions of Dollars in Income Disguised as Company ExpensesRead the Press Release
A Hawaii businessman was convicted yesterday following an 11-day jury trial in Honolulu of one count of corruptly endeavoring to obstruct the administration of the Internal Revenue Code and six counts of filing false individual income tax returns, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney Florence T. Nakakuni of the District of Hawaii.
The jury convicted Albert S.N. Hee, 61, of Kailua, Hawaii, of filing false income tax returns for tax years 2007 through 2012, and of obstructing the Internal Revenue Service (IRS) from 2002 through 2012. According to court documents and the evidence introduced at trial, Hee owned Waimana Enterprises Inc., a telecommunications holding company based in Honolulu. Over the course of a decade, Hee directed Waimana to pay millions of dollars in personal expenses on his behalf. He falsely deducted the payments from his corporate tax returns as if they were legitimate business expenses, and failed to report the payments as income on his individual returns.
“The jury’s verdict reflects the department’s unwavering commitment to U.S. taxpayers to aggressively pursue and prosecute individuals like Mr. Hee, who cheat the government to line their own pockets and finance their extravagant lifestyles,” said Acting Assistant Attorney General Ciraolo.
Hee’s lavish spending included paying more than $96,000 for personal massages; paying his wife and children full-time salaries with benefits packages, even though they performed little to no work for the company; and paying more than $736,900 in college tuition and housing for his three children. Hee also directed Waimana to pay various expenses on his personal credit card, including family trips to Walt Disney World, Tahiti, France, Switzerland, and a four-day vacation at the Mauna Lani resort on the Big Island of Hawaii, which Hee falsely characterized as a “stockholder’s meeting” and deducted as a business expense on the company’s tax return.
In 2008, Hee used company funds to purchase a home in Santa Clara, California, valued at $1.3 million. Hee told his accountants that the property would be used as an employee retreat in an attempt to disguise it as a legitimate business expense. However, Hee’s children testified at trial that from 2008 through 2012, they lived in the home while attending college in Santa Clara and did not pay rent to Waimana for their use of the property. Hee’s son testified that the house was walking distance from the college campus, and that he and his sister rented other rooms of the house to their college friends, but kept the rent that they collected from their roommates and did not give it to their father’s company.
At Hee’s scheduled Oct. 26 sentencing, he faces a statutory maximum sentence of three years in prison for each charge, a fine of up to $250,000 and restitution to the IRS.
Acting Assistant Attorney General Ciraolo and U.S. Attorney Nakakuni commended the special agents of IRS–Criminal Investigation, who investigated the case, and Trial Attorney Quinn P. Harrington of the Tax Division and Assistant U.S. Attorneys Les Osborne and Larry Tong of the District of Hawaii, who are prosecuting the case.
Harrisburg Man Charged with Four Additional Bank Robberies in Pennsylvania and New JerseyRead the Press Release
HARRISBURG - The United States Attorney's Office for the Middle District of Pennsylvania announced today that a Harrisburg man who pled guilty to the December 9, 2014 robbery of the Mid Penn Bank on North Front Street in Harrisburg has been charged with four additional bank robberies.
According to United States Attorney Peter Smith, Dylan Blum, age 22, has been charged in a four count Criminal Information that was filed in U.S. District Court in Harrisburg on Friday, July 10, 2015, charging him with the robberies of four banks in December of 2014 and January of 2015 in Northampton County, Pennsylvania and in New Jersey. Blum allegedly passed a threatening note to tellers at three of those robberies and attempted to rob another bank but was prevented by employees from entering that bank. Blum allegedly made off with a total of $5,788.00 from the three banks he was able to rob. Blum turned himself in to the Harrisburg Police department on January 3, 2015.
The government also filed a plea agreement in the case which is subject to the approval of the court. Blum is currently in custody.
The case was investigated by the Harrisburg Police Department and the Harrisburg Office of the Federal Bureau of Investigation. Assistant United States Attorney William A. Behe has been assigned to prosecute the case.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
For this case, the maximum penalty under federal law for each count is 20 years of imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Guilty Plea in Fraudulent Employment Visa SchemeRead the Press Release
CONCORD, N.H. – Jae Won Lee, 38, of Rockville, Maryland, pleaded guilty to two counts of causing others to make false statements on visa applications filed with the National Visa Center in Portsmouth, New Hampshire, reports Acting United States Attorney Donald Feith.
Lee worked with an emigration company in Seoul, South Korea, that helped South Koreans obtain employment-based visas to immigrate to the United States. From in and around March 2008, through in and around December 2014, Lee recruited various U.S. employers, including Wallace Enterprises, Inc. d/b/a The Cleaning Authority, a company in Falls Church, Virginia, to file various documents falsely representing to the United States government that they would hire certain visa applicants if the applicants received employment-based visas, when, in actuality, no positions were available for the applicants. Lee told some employers they were not required to hire the applicants and he paid or offered to pay some employers for filing false documents.
Lee also falsely informed visa applicants that Wallace or other employers would hire them if they were granted visas. That caused the applicants to unwittingly file Applications for Immigrant Visa and Alien Registration with the National Visa Center that contained materially false information identifying Wallace and other companies as the U.S. employers who would hire them if they were issued visas. Lee’s actions resulted in applicants receiving employment-based visas when there was no job waiting for them in the United States.
Lee is facing a maximum sentence of five years in prison and a maximum fine of $250,000. A sentencing hearing has been scheduled for November 3, 2015.
This case was investigated by the offices of the Inspectors General for the Department of State and the Department of Labor. It is being prosecuted by Assistant United States Attorney Mark S. Zuckerman.
Four Plead Guilty in Million Dollar Tax Refund Fraud SchemeRead the Press Release
Maria J. Rodriguez, 45, of Smyrna, Tenn.; Regulo Aldama-Olivares, 26, and Carlos Sanchez-Aldama, 30, both of Mexico; and Marcelino Lainez-Villalobos, 38, of Honduras; each admitted conspiring with one other, and with other persons between January 2011 and June 2014 to defraud the United States.
“Those who exploit the vulnerabilities in the federal tax system and steal from the taxpayers will continue to be pursued by the U.S. Attorney’s Office and our law enforcement partners,” said U.S. Attorney David Rivera.”
Each defendant admitted their participation in the scheme, including some who travelled to Tennessee to supply documents and identifications and prepare mail and retrieve the fraudulent tax returns. The defendants worked together to steal or help others to steal over $1 million of taxpayer money.
“Investigating refund fraud and identity theft continues to be a priority for IRS Criminal Investigation,” added Christopher A. Henry, IRS Special Agent in Charge. “Stealing identities and filing false tax returns is a serious crime that hurts innocent taxpayers. Law enforcement is serious about investigating these crimes and holding those who would defraud the government accountable.”
"Identifying financial crimes that threaten the health of our national economy and exposing criminals who attempt to steal from law-abiding taxpayers will continue to be a major investigative priority for HSI," said Cindy M. Johnson, Acting Special Agent in Charge of Homeland Security Investigations in New Orleans.
Each defendant faces 5 or more years in prison and those from Mexico and Honduras also face deportation.
Aldama-Olivares and Lainez-Villalobos are scheduled for sentencing October 30, 2015. Rodriguez and Sanchez-Aldama are scheduled for sentencing November 6, 2015.
This case was investigated by agents of the IRS- Criminal Investigation; Homeland Security Investigations; and the U.S. Postal Inspection Service. The case was prosecuted by Assistant U.S. Attorney Hilliard Hester.
Former Wheeling Island Casino employee sentenced for wire fraudRead the Press Release
WHEELING, WEST VIRGINIA – Mark E. Patterson, 47, of Wellsburg, West Virginia, was sentenced today to 12 months in prison for wire fraud. United States Attorney William J. Ihlenfeld, II, announced.
Patterson used his position as the main vault banker at Wheeling Island Hotel, Casino and Racetrack to steal more than $300,000 which he then deposited into various personal bank accounts. Patterson routinely underreported the daily cash proceeds earned on the casino floor. In turn, the casino they listed these false amounts on their financial reports which were sent to auditors and their parent company in New York. Patterson pled guilty in October 2014 to one count of “Wire Fraud.”
Assistant U.S. Attorney Robert McWilliams prosecuted the case on behalf of the government. The West Virginia State Police Bureau of Criminal Investigations led the inquiry.
U.S. District Judge John Preston Bailey presided.
Former St. Louis City Police Officer Sentenced to 24 Months on Weapons ChargesRead the Press Release
St. Louis, MO – United States District Court Judge Audrey G. Fleissig sentenced former St. Louis City Police Officer DON McGHEE to 24 months imprisonment this afternoon on charges of providing a firearm to known drug dealers to facilitate their distribution of crack cocaine and marijuana in the City of St. Louis.
According to court documents, McGhee was a St. Louis Metropolitan Police Officer assigned as a Patrolman in the Sixth District. Officer McGhee knew and associated with individuals who stored and distributed quantities of crack cocaine and marijuana in and from a house located on Cottage Avenue in the City of St. Louis. On March 2, 2014, Officer McGhee took a Mossberg 12-gauge pistol grip shotgun to the Cottage Avenue drug house and gave it to one of the drug dealers knowing, believing or having reason to believe that the drug dealer would use the shotgun in relation to and in furtherance of the drug trafficking. During the execution of a search warrant at the Cottage Avenue house several days later, law enforcement officers recovered the Mossberg pistol grip shotgun, fully loaded, along with several other firearms, ammunition, quantities of crack cocaine and marijuana and a large amount of cash.
McGhee, St. Louis City, pled guilty in April 2015 to one felony count of conspiracy to possess a firearm in relation to a drug trafficking crime.
United States Attorney Richard Callahan stated that this case again proved that the St. Louis City Police Department had the will and the integrity to investigate wrongdoing within its own Department. He noted that this investigation originated with the St. Louis City Police Department, which then sought the partnership of additional law enforcement agencies as its investigation expanded. In addition to the St. Louis City Police Department, the case was also investigated by the Federal Bureau of Investigation, the United States Drug Enforcement Administration and the St. Louis Circuit Attorney’s Office.
Former Navy Pilot and Top Gun Graduate Sentenced to 50 Years in Prison in Sextortion CaseRead the Press Release
NORFOLK, Va. – Daniel Chase Harris, 31, of Virginia Beach, Virginia, was sentenced yesterday to 600 months in prison, followed by lifetime supervised release for his crimes including production of child pornography, use of a facility of interstate commerce to entice a minor to engage in criminal sexual activity, receipt of child pornography, transportation of child pornography, possession of child pornography and obstruction of justice.
Harris was found guilty on 31 counts on March 9, 2015, after a 12-day trial. According to court records and the evidence at trial, Harris was a Lieutenant in the U.S. Navy and a Navy Top Gun graduate stationed at Naval Air Station Oceana. Harris was originally arrested by Bedford County Sheriff’s Office in November 2013. The investigation and evidence at trial revealed that Harris posed online as a teenage boy and would convince young teen girls between the ages of 12 and 17 to send him risqué pictures of themselves. He then extorted the girls to send him additional, sexually graphic and explicit images of themselves or he threatened them with posting the images online or sending the images to family or friends. Nine victims were involved in this case, three of whom are from Virginia. In pronouncing the sentence, District Judge Mark S. Davis stated Harris’ actions were “sadistic” and equated to “torture.”
Homeland Security Investigations and the Southern Virginia Internet Crimes Against Children Task Force (SOVA ICAC) led the investigation in this case. Assistant U.S. Attorney Elizabeth M. Yusi and Special Assistant U.S. Attorney Wes Nance, Deputy Commonwealth’s Attorney for Bedford County, 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. 2:14-cr-76.
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Former Mount Juliet Police Sergeant Charged with Federal Program Fraud and Wire FraudRead the Press Release
Jason Ezell, 40, of Lebanon, Tenn., was charged in a criminal information on July 10, 2015, with federal program fraud and wire fraud, announced David Rivera, U.S. Attorney for the Middle District of Tennessee.
Ezell was a sergeant with the Mount Juliet Police Department and supervised the Crime Suppression Unit. In that position, Ezell was responsible for preparing time cards and submitting overtime logs for officers working in support of and assisting in federal Organized Crime Drug Enforcement Task Force (OCDETF) investigations. The OCDETF Program is a federal program within the United States Department of Justice which aims to focus federal resources to combat the flow of illicit drugs and dismantle drug trafficking organizations.
During the period of January 2013 through April 2015, Ezell fraudulently submitted City of Mount Juliet Time Card Reports and OCDETF Authorized Overtime Logs for payment, representing that that he had worked more than 500 hours of overtime that he did not in fact work. Ezell was paid more than $12,000 for the overtime he claimed.
If convicted, Ezell faces up to 10 years in prison for federal program fraud and up to 20 years in prison for wire fraud and a $250,000 fine for each charge.
This case was investigated by the Tennessee Bureau of Investigation; the FBI; the District Attorney’s Office for the 19th Judicial District; and the DOJ-Office of Inspector General. Assistant U.S. Attorney Thomas J. Jaworski is prosecuting the case.
A criminal information is merely an accusation. The defendant is presumed innocent unless and until proven guilty in a court of law.
Former Boston Police Officer Pleads Guilty to Making False StatementsRead the Press Release
BOSTON – A former Boston Police officer and former treasurer of the Boston Police Patrolmen’s Association pleaded guilty today in U.S. District Court in Boston to making a false statement to the FBI in connection with his cash loans to a known criminal.
David Michael Fitzgerald, 49, who resides in Milton, pleaded guilty to a one count Information of making a false statement to the FBI. Fitzgerald was a Boston Police officer from 1996 until this June when he resigned as part of his plea agreement. He was the treasurer of the Boston Police Patrolmen’s Association (BPAA) from 2012 to 2014.
According to court documents, Fitzgerald developed a relationship with an individual who was a known street-level drug dealer and bookmaker. During the course of this relationship, Fitzgerald made cash loans to the individual, which were paid back in weekly installments. On April 27, 2015, Fitzgerald met the individual in Watertown in order to collect a $500 cash installment for one of the outstanding loans. Later that same day, when federal agents who were investigating the matter questioned Fitzgerald, he falsely stated that the purpose of his meeting with the individual was simply social in nature and that he had never loaned money to the individual. Not only were these statements untrue, but they were intended to interfere with an ongoing federal investigation.
The charging statute provides a sentence of no greater than five years in prison, three years of supervised release, and a fine of $250,000. In addition to his resignation, the plea agreement also contemplates a joint, non-binding recommendation to the Court for a sentence of one year probation. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors. Judge Nathaniel Gorton set sentencing for Oct. 20, 2015.
United States Attorney Carmen M. Ortiz; Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and Boston Police Commissioner William Evans, made the announcement today. The U.S. Attorney’s Office also wishes to acknowledge the cooperation of the Boston Police Department’s Anti-Corruption Division. The case is being prosecuted by Assistant U.S. Attorney Eugenia M. Carris and Robert A. Fisher of Ortiz’s Public Corruption & Special Prosecutions Unit.
Five Individuals Indicted in July 2015 Federal Grand JuryRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office announced today the results of the July 2015 Federal Grand Jury.
“The following named individuals have been charged with a federal crime or crimes by the return of an indictment by the Grand Jury. A grand jury Indictment does not constitute evidence of guilt. A grand jury Indictment is a method of bringing formal charges against the defendant. A defendant is presumed innocent of the charges and may not be found guilty unless evidence establishes guilt beyond a reasonable doubt. United States Sentencing Guidelines may be considered, upon conviction, by the sentencing court. Federal prison sentences are non-parolable.”
ERIC WAYNE LOCKHART, age 30, of Muldrow, Oklahoma
Use Of Telephone To Make Bomb Threat
The Indictment alleges that on or about June 15, 2015, in the Eastern District of Oklahoma, the defendant did, through use of a telephone, make a threat to kill, injure and intimidate an individual by means of an explosive, in and affecting interstate commerce. The charge arose from an investigation by the Sequoyah County Sheriff’s Department and the Bureau of Alcohol, Tobacco and Firearms.
The charges are in violation of Title 18, United States Code, Section 844(e), punishable by up to 10 years imprisonment, up to a $250,000.00 fine or both.
Assistant United States Attorney Chris Wilson
DERRICK CASEY FRY, age 35, of Nashoba, Oklahoma a/k/a DERREK CASEY FRY
Assault With A Dangerous Weapon
Assault Resulting In Serious Bodily InjuryThe Indictment alleges that on or about the 23rd day of June, 2015, in the Eastern District of Oklahoma, in Indian Country, within the special maritime and territorial jurisdiction of the United States, the defendant, an Indian, assaulted James Belvin with a dangerous weapon, with the intent to do bodily harm which resulted in serious bodily injury. The charges arose from an investigation by the Choctaw Nation Tribal Police and the Federal Bureau of Investigation.
The charges are in violation of Title 18, United States Code, Sections 1153, 1151 and 113(a)(3) and Title 18, United States Code, Sections 1153, 1151 and 113(a)(6), punishable by not more than 10 years imprisonment, up to a $250,000.00 fine or both.
Assistant United States Attorney Edward Snow
JAVONTE SHAWN ALEXANDER, age 23, of Brooklyn, New York
MALIK AIULU ANDREWS, age 19, of Oxnard, California
JAMES RODNEY SIMS, age 27, of Douglasville, Georgia
Possession Of Fifteen Or More Counterfeit Access Devices
The Indictment alleges that on or about April 24, 2015, within the Eastern District of Oklahoma, the Defendants, each aiding and abetting the other, knowingly possessed fifteen (15) or more access devices as defined in Title 18, United States Code, Sections 1029(e)(1), 1029(e)(2) or 1029(e)(3), which are counterfeit or unauthorized access devices, with said activity affecting interstate commerce.
The charges arose from an investigation by the Oklahoma Highway Patrol and the United States Secret Service. The charges are in violation of Title 18, United States Code, Sections 1029(a)(3) and 2, punishable by up to 10 years imprisonment, a fine of up to $250,00.00 or both.
Assistant United States Attorney Melody Nelson
Federal Welfare Fraud Conviction Results in Prison and Deportation of Muhammad DalalliRead the Press Release
Muhammad Dalalli Sentenced for Role in Welfare Fraud Scheme
GRAND RAPIDS, MICHIGAN — U.S. Attorney Patrick Miles announced today that Muhammad Dalalli, 41, of Grand Rapids, was sentenced by Chief U.S. District Judge Robert J. Jonker for his scheme to defraud the federal government in connection with subsistence benefits.
On November 4, 2013, Dalalli and his wife were charged with defrauding the federal government of numerous subsistence benefits after arriving in the United States from Iraq. The programs defrauded included the Women, Infants and Children ("WIC") program, Temporary Assistance to Needy Families ("TANF"), HUD, and Medicaid benefits. Dalalli and his wife defrauded these programs by failing to reveal their ownership of Lebanese bank accounts and other assets, and by concealing their living arrangements in connection with their receipt of HUD-subsidized housing. The fraud scheme resulted in losses totaling $126,739. Dalalli, a naturalized U.S. citizen, was additionally charged with making false statements in connection with his citizenship application.
Dalalli’s trial commenced on January 13, 2015. After the first day of trial he entered a guilty plea to all counts. Shortly thereafter, he requested that his guilty pleas be set aside, claiming that he had been coerced into pleading guilty by his defense attorney. This request was denied by Judge Jonker, who noted that the court had inquired at length with Dalalli concerning his decision to plead guilty, and Dalalli had assured the court that his decision to plead guilty was voluntary.
On July 14, 2015, Judge Jonker sentenced Dalalli to serve a prison term of 27 months, followed by supervised release of 36 months. The sentence included restitution of $126,739. Dalalli was also stripped of his U.S. citizenship and ordered deported following the completion of his sentence. Dalalli’s wife, Rima Alame, will be sentenced on August 31, 2015.
This case was investigated by the Department of Agriculture, Office of Inspector General, the Federal Bureau of Investigation, and the Michigan Department of Health and Human Services, Office of Inspector General. The case was prosecuted by Assistant U.S. Attorney Timothy VerHey.
Federal Grand Jury Indictment(s)Read the Press Release
Contact Person: Beth Drake (803) 929-3000
United States Attorney Bill Nettles stated today that a Federal Grand Jury in Greenville, South Carolina, returned Indictment(s) against the following:
Gaffney Man Indicted for Food Stamp Fraud
Mickey Dean Allison, Jr., age 39, owner of Original Allison’s Produce, from Gaffney, South Carolina, was charged in a two-count indictment. Allison was charged with Food Stamp Fraud, a violation of Title 7, United States Code, Section 2024, and Defrauding the United States Government, a violation of Title 18, United States Code, Section 641. The maximum penalty Allison could receive is 20 years imprisonment and a maximum fine of $250,000. The case was investigated by agents of the Office of Inspector General for the USDA and Cherokee County Sheriff's Office and is assigned to Assistant United States Attorney Jamie Lea Schoen of the Greenville office for prosecution.The United States Attorney stated that all charges in these Indictments are merely accusations and that all defendants are presumed innocent until and unless proven guilty.
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Entercom Required to Divest Three Denver Radio Stations as Part of Lincoln AcquisitionRead the Press Release
Settlement Preserves Competition That Benefits Radio Advertisers
Entercom Communications Corp. (Entercom) will be required to divest three radio stations in Denver, in order to proceed with its acquisition of Lincoln Financial Media Company (Lincoln). Without these divestitures, the transaction would have resulted in higher prices and a reduced quality of service to purchasers of English-language radio advertising in Denver.
“Entercom and Lincoln own some of the most highly rated radio stations in Denver, and advertisers targeting radio listeners in Denver have benefitted from competition between them,” said Assistant Attorney General Bill Baer of the Justice Department’s Antitrust Division. “These divestures will preserve that competitive dynamic.”
The Antitrust Division filed a civil antitrust lawsuit today in the U.S. District Court of the District of Columbia to block the proposed acquisition. At the same time, the department filed a proposed settlement that, if approved by the court, would resolve the competitive harm alleged in the lawsuit. According to the complaint, the proposed merger would have eliminated the head-to-head competition that currently exists between Entercom’s and Lincoln’s radio stations for the business of local and national companies that advertise to English-language listeners on radio stations in Denver. Under the terms of the proposed settlement, Entercom has agreed to divest three stations in Denver to a department-approved buyer.
Entercom is incorporated in Pennsylvania and headquartered in Bala Cynwyd, Pennsylvania. Lincoln is an indirect, wholly owned subsidiary of Lincoln National Corp. Lincoln is organized under the laws of North Carolina, and headquartered in Atlanta. Both Entercom and Lincoln operate broadcast radio stations in various metropolitan areas throughout the United States.
As required by the Tunney Act, the proposed settlement, along with the department’s competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement during a 60-day comment period to David Kully, Chief, Litigation III Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street, N.W., Fourth Floor, Washington, D.C. 20530. At the conclusion of the 60-day comment period, the court may enter the final judgment upon a finding that it serves the public interest.
Entercom Complaint
Entercom Explanation
Entercom Hold Separate Stipulation and Order
Entercom Proposed Final Judgment
Entercom Competitive Impact Statement
El Departamento de Justicia y la Oficina para la Protección Financiera del Consumidor Realizan Acuerdo Conciliatorio Innovador en Resolución de Alegatos de Discriminación en Créditos para Automoviles por parte de HondaRead the Press Release
WASHINGTON – El Departamento de Justicia [Department of Justice (DOJ)] y la Oficina para la Protección Financiera del Consumidor [Consumer Financial Protection Bureau (CFPB)] anunciaron hoy un acuerdo conciliatorio innovador para resolver alegatos de que American Honda Finance Corporation (Honda) mantuvo un patrón o práctica de discriminación contra prestatarios afroestadounidenses, hispanos y asiáticos/isleños del Pacífico en préstamos automóviles. Honda tiene sede en Torrance, California.
El acuerdo conciliatorio es especialmente destacable debido al compromiso de la compañía de limitar significativamente la libertad de criterio de los concesionarios de automóviles para cobrar sobreprecios en las tasas de interés en préstamos de Honda. Específicamente, Honda aceptó cambiar la manera en que establece el precio de sus préstamos limitando los márgenes de ganancias de los vendedores a 125 puntos base (o 1.25%) para préstamos de 60 meses o menos y a 100 puntos base (o 1%) para préstamos de más de 60 meses. El acuerdo conciliatorio también establece 24 millones de dólares en compensación para supuestas víctimas de discriminación pasada por parte del noveno mayor prestamista automotor del país.
“Felicitamos a Honda por su liderazgo en aceptar imponer límites inferiores a los márgenes de ganancias discrecionales y por su compromiso de tratar de manera justa a todos sus clientes sin importar su raza u origen nacional”, dijo la Secretaria de Justicia Auxiliar Adjunta Principal Vanita Gupta de la División de Derechos Civiles. “Reconocemos que los concesionarios brindan un servicio valioso al conectar a los clientes con los prestamistas, y que deben ser compensados de manera justa por ese servicio. Creemos que el nuevo sistema de compensación de Honda logra el equilibrio entre una compensación justa para los vendedores y préstamos justos para los consumidores. Esperamos que el liderazgo de Honda incentive al resto de la industria a restringir los márgenes de ganancias de los vendedores para abordar el tema de la fijación de precios discriminatorios”.
Las investigaciones coordinadas por parte del departamento y la CFPB que precedieron al acuerdo conciliatorio de hoy establecieron que este sistema de determinación subjetiva y libre de los precios hace que prestatarios calificados afroestadounidenses, hispanos y asiáticos/isleños del Pacífico de Honda terminen pagando más que los prestatarios blancos no hispanos calificados. El Departamento y la CFPB preveen que los nuevos límites de Honda respecto a los márgenes de ganancias discresionales reducirán o eliminarán substancialmente estas disparidades.
Honda es conocida como prestamista automotriz “indirecta” porque, en vez de recibir solicitudes directamente de los consumidores, la compañía realiza la mayoría de sus préstamos a través de concesionarios de todo el país que ayudan a sus clientes a pagar por su automóvil nuevo o usado presentando su solicitud de préstamo a Honda. La práctica comercial de Honda, como la de la mayoría de las grandes sociedades de préstamo automotores, permite que los concesionarios varíen la tasa de interés de un préstamo respecto de la tasa inicialmente establecida por Honda según factores crediticios objetivos del prestatario. Los concesionarios reciben pagos más altos de Honda por préstamos que incluyan una tasa de interés más alta.
El acuerdo conciliatorio resuelve alegatos del Departamento y la CFPB de que Honda discriminó por cobrar a miles de prestatarios afoestadounidenses, hispanos y asiáticos/isleños del Pacífico mayores tasas de interés que a prestatarios blancos no hispanos. Las agencias alegan que Honda les cobraba mayores tasas de interés a los prestatarios debido a su raza u origen nacional, y no debido a su solvencia u otros criterios objetivos relacionados con el riesgo crediticio. La demanda de los Estados Unidos alega que la víctima afroestadounidense promedio fue obligada a pagar más de 250 dólares más durante el préstamo por discriminación, la víctima hispana promedio fue obligada a pagar más de 200 dólares más durante el préstamo por discriminación y la víctima asiática/isleña del Pacífico promedio fue obligada a pagar más de 150 dólares más durante el préstamo por discriminación. La Ley de Igualdad de Oportunidades de Crédito [Equal Credit Opportunity Act (ECOA)] prohibe esta clase de discriminación en todos los tipos de préstamos, entre ellos los préstamos automotores. El acuerdo conciliatorio de Honda con el DOJ, que está sujeto a la aprobación del tribunal, fue presentado hoy en el Tribunal Federal de Distrito del Distrito Central de California junto con la demanda del DOJ. Honda resolvió los alegatos de la CFPB firmando un acuerdo conciliatorio administrativo público.
“El CFPB está comprometido a crear un mercado justo para todos los consumidores, y otros prestamistas automotores deberían tener en cuenta la acción de hoy”, dijo el Director Richard Cordray de la CFPB. “El nuevo sistema de fijación de precios y compensación de Honda demuestra liderazgo en la industria y representa un paso significativo en la protección de los consumidores contra la discriminación”.
“Las prácticas de financiamiento de Honda que permitían a los concesionarios poner sobreprecios en préstamos individuales trajeron como resultado discriminación ilegal, ya que compradores de autos minoritarios pagaron más por sus préstamos que compradores no pertenecientes a minorías con historiales crediticios similares”, dijo la Fiscal Federal Eileen M. Decker del Distrito Central de California. “Este acuerdo conciliatorio establece que Honda aportará 24 millones de dólares a un fondo del acuerdo conciliatorio para ofrecer un desagravio a miles de prestatarios minoritarios, no solo en este distrito, donde tienen sede las operaciones en Estados Unidos de Honda, sino en todo el país. Esto envía un mensaje claro de que no se tolerará ningún tipo de discriminación, y de que las demás empresas automotrices deberían seguir el camino de Honda y tomar medidas para asegurarse de que sus prácticas de venta y financiación no traigan como resultado actos de discrminación”.
Además de los 24 millones de dólares en pagos por su conducta en el pasado, bajo la orden por consentimiento del DOJ, Honda también deberá pagar 1 millón de dólares para financiar un programa de educación financiera al consumidor enfocado en la financiación automotriz para clientes que está diseñado para beneficiar a poblaciones afroestadounidenses, hispanas y asiáticas/isleñas del Pacífico.
El acuerdo conciliatorio también exige que Honda mejore sus sistemas de monitoreo y cumplimiento. El acuerdo conciliatorio permite que el prestamista experimente con diferentes enfoques para reducir la discriminación y requiere que informe periódicamente al departamento y la CFPB sobre los resultados de sus iniciativas, así como también comente maneras potenciales de mejorar los resultados. El departamento felicita a Honda por trabajar de manera cooperativa para llegar a una resolución adecuada de este caso.
El acuerdo conciliatorio establece la existencia de un administrador para ubicar a las víctimas y distribuir los pagos de compensación sin costo para los prestatarios a los que el departamento y la CFPB identifiquen como víctimas de discriminación de Honda. El departamento y la CFPB realizarán un anuncio público y publicarán información en sus portales una vez que existan más detalles sobre el proceso de compensación. El administrador del acuerdo se comunicará con los prestatarios que son elegibles para recibir compensación bajo el acuerdo conciliatorio y no es necesario que se comuniquen con el departamento o la CFPB por el momento.
La División de Derechos Civiles, la Fiscalía Federal para el Distrito Central de California y la CFPB son miembros de la Fuerza de Tarea de Coacción contra el Fraude Financiero. El Presidente Obama fundó la Fuerza de Tarea de Coacción contra el Fraude Financiero para generar una iniciativa enérgica, coordinada y proactiva para investigar y enjuiciar los delitos financieros. La fuerza de tarea incluye a representantes de una amplia gama de agencias federales, autoridades regulatorias, inspectores generales y fuerzas del orden público estatales y locales quienes, trabajando juntos, implementan un conjunto poderoso de recursos de coacción penal y civil. La fuerza de tarea está trabajando para mejorar las iniciativas en todo el poder ejecutivo federal y, junto con asociados estatales y locales, investigar y enjuiciar delitos financieros importantes, garantizar un castigo justo y eficaz para quienes cometen delitos financieros, combatir la discriminación en los mercados de préstamos y financieros, y recuperar ganancias para las víctimas de delitos financieros.
La coacción asociada a las leyes de otorgamiento justo de préstamos por parte del departamento es llevada a cabo por la Unidad de Préstamos Justos de la Sección de Vivienda y Cumplimiento de la Ley Civil de la División de Derechos Civiles. Desde que se estableció la Unidad de Préstamos Justos en febrero de 2010, entabló o resolvió 40 casos de préstamos bajo la Ley de Vivienda Justa, la ECOA y la Ley de Alivio Civil para los Miembros de las Fuerzas Armadas [Servicemembers Civil Relief Act]. Los acuerdos en estos casos proveen un total de al menos 1,200 millones de dólares en asistencia monetaria para comunidades afectadas. Los informes anuales del Secretario de Justicia de EE.UU. al Congreso sujetos a ECOA destacan los logros del Departamento en el otorgamiento de préstamos justos y están disponibles en www.justice.gov/crt/publications.
Easton Police Commissioner Charged in Federal Steroid and Prescription Narcotic Distribution InvestigationRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that RAYMOND J. MARTIN, 48, of Easton, was arrested today in connection with a federal steroid and prescription narcotic distribution investigation.
MARTIN, who is a member of the Easton Police Commission, appeared before U.S. Magistrate Judge Sarah A. L. Merriam in New Haven and was released on bond.
This matter stems from a long term investigation led by the Federal Bureau of Investigation, Drug Enforcement Administration and Homeland Security Investigations into individuals who were receiving shipments of steroid ingredients from China and manufacturing and distributing wholesale quantities of steroids. The investigation also revealed that certain individuals were distributing prescription pills, including oxycodone.
As alleged in the criminal complaint, a court-authorized wiretap intercepted MARTIN engaging in text communications with other members of the conspiracy discussing the distribution of anabolic steroids and oxycodone.
The complaint charges MARTIN with conspiracy to possess oxycodone with intent to distribute, an offense that carries a maximum term of imprisonment of 20 years.
Eleven other individuals have been charged as a result of the investigation. During the course of the investigation, law enforcement officers seized hundreds of vials of steroids, approximately 600 grams of raw testosterone powder, more than 1,000 oxycodone pills, approximately 350 grams of powder cocaine and four long guns.
This matter is being investigated by the Federal Bureau of Investigation, Drug Enforcement Administration and Homeland Security Investigations, with the assistance of the U.S. Marshals Service.
This case is being prosecuted by Assistant U.S. Attorneys Rahul Kale and Robert M. Spector.
U.S. Attorney Daly stressed that a federal complaint is not evidence of guilt. Charges are only allegations and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
East Haven Resident Admits Operating $2 Million Investment SchemeRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that JOHN D’AURIA, 41, of East Haven, waived his right to indictment and pleaded guilty yesterday before U.S. District Judge Michael P. Shea in Hartford to one count of wire fraud stemming from his operation of an investment scheme that defrauded investors of approximately $2.4 million.
According to court documents and statements made in court, D’AURIA conducted an investment business using the name Fifth Street Capital. D’AURIA was a licensed and registered investment adviser but lost his license in approximately 2011. From approximately 2010 to 2014, D’AURIA engaged in a scheme to defraud investors who had provided him with investment funds by failing to invest the funds as represented and by using the majority of the funds for his personal use.
As part of his scheme, D’AURIA made false statements and misrepresentations to his investors regarding the purported returns generated by their investments. He also represented to investors that their funds were fully invested in separate accounts. In truth, D’AURIA did not fully invest the investors’ funds but rather commingled the funds in his own personal bank accounts and his own trading account.
As a result of D’AURIA’s scheme to defraud, approximately eight investors lost a total of approximately $2.4 million of the funds they provided to D’AURIA.
Judge Shea scheduled sentencing for October 6, 2015, at which time D’AURIA faces a maximum term of imprisonment of 20 years, a maximum fine of more than $4.8 million and an order of restitution.
D’AURIA is released on a $100,000 bond.
This matter is being investigated by the Federal Bureau of Investigation and is being prosecuted by Senior Litigation Counsel Richard J. Schechter.
Drug Dealer Sentenced to 120 Months in PrisonRead the Press Release
PORTLAND, Ore. – Tyson Gregory Fortner, 36, of Portland, Oregon, was sentenced by U.S. District Judge Marco A. Hernandez to 120 months in prison following his federal conviction for possession with the intent to distribute methamphetamine. When the defendant is released from prison, he will serve five years of supervised release.
On June 26, 2013, investigators from the Clackamas County Interagency Task Force received information from a confidential informant (CI) that the defendant was a methamphetamine dealer operating in the Portland, Oregon area. Surveillance teams set up on the defendant’s residence in Portland, Oregon and, after he was observed driving away from the residence, they conducted a traffic stop on his car. The defendant was found to be driving without a license. A subsequent search of the defendant’s car found 89 grams of methamphetamine, 38 grams of heroin, a digital scale, and $8,100 in cash. When the officers searched the defendant they found a drug record ledger and $655 in cash. A subsequent search of the defendant’s residence resulted in the discovery of an additional 572 grams of methamphetamine, 123 grams of heroin, 4 grams of psilocybin mushrooms, 14 grams of cocaine, drug packaging material, a digital scale, a .45 caliber Smith and Wesson handgun, a .45 caliber Colt handgun, brass knuckles, and $49,850 in cash. The officers’ investigation revealed that the defendant possessed the drugs with the intent to distribute them and that over the previous eight months he had conservatively distributed at least 84 kilograms of methamphetamine and 567 grams of heroin. The defendant was arrested and indicted on federal charges on July 9, 2013.
“Methamphetamine has been identified as the region’s most serious drug threat, and heroin is a close second,” stated Acting U.S. Attorney Billy Williams. “Our office will continue to work with law enforcement to prosecute these significant drug dealers who are spreading destruction throughout the community for their own personal profit.”
According to the Oregon High Intensity Drug Trafficking Area (HIDTA) Program:
Methamphetamine in the form of crystal methamphetamine, or “ice,” continues to be readily available and widely used throughout the Oregon HIDTA and represents the region’s most serious drug threat. Methamphetamine is a highly addictive central nervous system stimulant that is abused for its euphoric and stimulant effects. Chronic methamphetamine abusers exhibit violent behavior, confusion, insomnia and psychotic characteristics such as hallucinations and paranoia. Methamphetamine-related crime, such as identity theft, abused and neglected children, and other serious person and property crimes, continues to occur at a palpable rate and is prevalent throughout the HIDTA region.
Oregon and Idaho law enforcement officers surveyed in 2015 indicated methamphetamine remains a significant threat due to its level of use and availability; nexus to other crimes such as violent activity and property crime; societal impact; and connection to drug trafficking organizations, primarily MNDTOs [multi-national drug trafficking organizations]. Of law enforcement agencies surveyed, 62 percent reported methamphetamine as the greatest Oregon HIDTA Program drug threat to their area, with the majority indicating methamphetamine as the drug that contributes most to violent crime (88%) and property crime (69%). Furthermore, over 60 percent of officers ranked methamphetamine as the drug that serves as the primary funding source for major criminal activity.
Threat Assessment and Counter-Drug Strategy, Program Year 2016, Oregon HIDTA Program, at 12-13 (June 2015).
The HIDTA report also noted that “heroin availability and its use has reached a critical level and represents a close second to methamphetamine as the region’s most serious drug threat” and that “[n]early a quarter (24%) of law enforcement officers surveyed in Oregon and Idaho in 2015 indicated that heroin was the principal threat to their area due to the substantial rise in availability and the increase in the number of new and younger users and associated overdoses.” Id. at 20.
This case was part of an Organized Crime Drug Enforcement Task Force (OCDETF) joint investigation involving the Clackamas County Interagency Task Force, the Drug Enforcement Administration, Department of Homeland Security Investigations, the Portland Police Bureau and the U.S. Attorney’s Office. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking organizations and those primarily responsible for the nation’s illegal drug supply. The case was prosecuted by Assistant U. S. Attorney Scott Kerin.
Charlotte Man Sentenced to More Than 15 Years in Prison for Sex Trafficking of A MinorRead the Press Release
CHARLOTTE, N.C. – Today, U.S. District Judge Max O. Cogburn, Jr. sentenced Tony Lee Drum, 32, of Charlotte, to 188 months in prison for two counts of sex trafficking of minors and two counts of transporting minors across states lines for purposes of prostitution, announced Jill Westmoreland Rose, Acting U.S. Attorney for the Western District of North Carolina. Judge Cogburn also sentenced Drum to a lifetime of supervised release upon completion of his prison term.
Ryan L. Spradlin, Special Agent in Charge of ICE/Homeland Security Investigations (HSI) in Georgia and the Carolinas and Chief Kerr Putney, of the Charlotte-Mecklenburg Police Department (CMPD) join Acting U.S. Attorney Rose in making today’s announcement.
According to filed court documents and statements made in court, between August 2013 and October 2013, Drum knowingly recruited, enticed, and harbored two minor females, identified in court documents as “D.W.” and “A.C.,” for the purpose of engaging in commercial sex acts. Court records show that Drum met D.W. on a telephone chat service and A.C. on social media, and he knew both girls were minors. On two occasions, court records indicate that Drum drove across state lines to pick up the minors and transport them to Charlotte to engage in prostitution. According to court documents, an alert CMPD officer encountered D.W. while patrolling an area in Charlotte in September, 2013, and later identified her as a missing teen. Law enforcement found A.C. sleeping in Drum’s car in October, 2013, while serving an arrest warrant on Drum for trafficking D.W.
“Drum preyed upon young, vulnerable victims, and with the promise of food, shelter and security, he lured them to Charlotte with the intention of exploiting them for his financial benefit. Fortunately, a well-trained law enforcement officer observed one of the victims and the immediate circumstance and as a result, two young women were rescued from a life on the streets. My office is committed to prosecuting sex trafficking cases and continuing to work with our law enforcement partners to identify those who engage in this illegal, dehumanizing business,” said Acting U.S. Attorney Rose.
“Unfortunately, child predators have become increasingly adept at using social media and other modern communication tools to identify and manipulate their victims,” said Special Agent in Charge Ryan L. Spradlin, ICE Homeland Security Investigations Atlanta. “Whenever HSI and our law enforcement partners encounter children for sale, we won’t rest until we’ve identified and arrested the predators seeking to pimp them out and have rescued their victims from a life of exploitation and abuse.”
Drum will remain in federal custody until he is transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
The investigation of the case was handled by the HSI and CMPD. Assistant U.S. Attorney Kimlani Ford, of the U.S. Attorney’s office in Charlotte, prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Cedar Rapids Felon Sent to Prison for the Maximum Ten Years for Possessing a Firearm and AmmunitionRead the Press Release
A convicted felon who possessed a firearm and ammunition on the streets of Cedar Rapids last October was sentenced today to ten years in federal prison, the statutory maximum sentence possible for his crime.
Bernard James Butler II, age 24, from Cedar Rapids, Iowa, received the prison term after a March 30, 2015, guilty plea to one count of possessing a firearm and ammunition as a felon.
At the guilty plea hearing, Butler admitted that he knowingly possessed a Fabrique Nationale FNX-40 .40 caliber pistol on October 29, 2014, and ammunition. At the plea hearing, Butler also admitted to prior felony convictions in state court for going armed with intent; intimidation with a dangerous weapon; burglary in the second degree; and possession of a controlled substance with intent to deliver.
Butler was sentenced in Cedar Rapids by United States District Court Chief Judge Linda R. Reade to 120 months’ imprisonment. A special assessment of $100 was imposed. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system.
Butler is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Tim Vavricek and investigated by the FBI’s Safe Streets Task Force.
Court file information available: https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 15-CR-001.
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Canadian Man Admits Role in Microcap Stock Manipulation SchemeRead the Press Release
Newark, N.J. – A Canadian stock promoter today admitted his role in a scheme to artificially inflate the stock price of a publicly traded company through manipulative trading and other fraudulent means, U.S. Attorney Paul J. Fishman announced.
Mitchell G. Adam, 47, of Vancouver, Canada, pleaded guilty before U.S. District Judge Jose Linares to an information charging him with conspiracy to commit securities and mail fraud. Adam was initially charged by criminal complaint and arrested on May 20, 2015 at the George Bush Intercontinental Airport in Houston.
According to documents filed in this case and statements made in court:
Between July 2013 and November 2013, Adam conspired with Adam S. Gottbetter, 26, of New York, Kenneth David Stevenson, 55, of Vancouver, and others to manipulate the stock of HBP Energy Corp. (HBPE), a developmental stage company based in Houston. Adam and his conspirators obtained and concealed control of a significant portion of free-trading shares of HBPE stock and agreed to fraudulently inflate the price and trading volume of the stocks through a variety of means, including disseminating false or misleading promotional materials to the investing public and engaging in manipulative trading of the stocks to create the appearance of market interest. Afterwards, they planned to sell the stocks at the fraudulently inflated prices or use the fraudulently inflated value of the companies to solicit private investments, thereby profiting at the expense of the investing public.
Adam and the other conspirators recruited a stock promoter and trader who owned a broker-dealer in New York and who claimed to have experience in various manipulative and fraudulent trading strategies. Unbeknownst to Adam and his co-conspirators, however, this individual was cooperating with law enforcement (the “CW”).
During the scheme, the CW informed Adam, Gottbetter and Stevenson that he had developed an algorithmic trading system, or black box, for the purpose of manipulating the price of stocks. The CW explained that he controlled approximately 32 online brokerage accounts that were opened in the names of foreign nominees and that a computer program that he created could trade between those accounts to create the appearance of massive volume in any stock. Adam, Gottbetter and Stevenson directed the CW to use the black box in connection with the HBPE scheme. In addition to using the CW to manipulate HBPE’s stock, Adam, Gottbetter and Stevenson planned an elaborate promotional campaign that would take place after HBPE’s stock was manipulated to a certain level, including international “call rooms,” listing HBPE’s stock on foreign exchanges, a “road show” and other activities. Law enforcement intervened before the HBPE promotion could take place.
The conspiracy count to which Adam pleaded guilty carries a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gain or loss from the offense. Sentencing is scheduled for Oct. 27, 2015.
Gottbetter and Stevenson both pleaded guilty for their roles in the scheme. Gottbetter was sentenced to 18 months in prison on May 26, 2015. Stevenson was sentenced to one year of probation on May 28, 2015.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Richard M. Frankel in Newark, for the investigation leading to today’s plea. He also thanked the U.S. Securities and Exchange Commission’s New York Regional Office under the direction of Andrew Calamari.
The government is represented by Gurbir S. Grewal, Chief of the U.S. Attorney’s Office Economic Crimes Unit and Assistant U.S. Attorney Nicholas P. Grippo of the Economic Crimes Unit.
Defense Counsel: Frank A. Rubino, Esq. Coral Gables, Florida