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13 July 2015
Brooklyn Man Pleads Guilty in Manhattan Federal Court to Securities Fraud in Connection with Multimillion-Dollar Fraudulent Investment SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today that MARCELLO TREBITSCH pled guilty in Manhattan federal court to an Information charging him with one count of securities fraud in connection with his operation of a Ponzi scheme that defrauded investors of nearly $6 million over the course of seven years. Among other things, TREBITSCH admitted that he lied to investors by telling them that he would invest their money through an investment fund he controlled that would generate double-digit returns with very low risk. To that end, TREBITSCH provided investors with phony account statements and federal tax forms that reflected significant gains, when, in reality, TREBITSCH invested only a portion of the investors’ money and suffered enormous trading losses, and used the remainder of the investors’ money for his own personal benefit and to pay back other investors. TREBITSCH was arrested on April 13, 2015, and pled guilty today before United States District Judge Vernon S. Broderick.
U.S. Attorney Preet Bharara said: “As Marcello Trebitsch admitted in court today, he ran a multimillion-dollar Ponzi scheme, defrauding investors who put their faith in him and entrusted him with their hard-earned savings. He returned their faith with deceit and self-dealing, lying about his trading losses and using investor money on himself. I want to thank the FBI for their outstanding investigative work on this case.”
According to the Complaint, the Information that was filed today in Manhattan federal court, and other statements made in open court:
From 2007 through 2014, TREBITSCH engaged in a multimillion-dollar fraudulent investment scheme, during which he solicited money from investors based on materially false and misleading representations. Specifically, TREBITSCH told the investors that he, through an investment fund he created called Allese Capital LLC, would (a) create and perfect public shell companies to sell to private companies; (b) execute specific trades at the direction of an investor; and (c) purchase and sell stocks on a daily basis, with little or no funds remaining invested in the market at the end of each trading day. In some cases, TREBITSCH told the investors that they would receive double digit returns with minimal risk of loss. In fact, TREBITSCH did not invest the money as he said he would, and instead principally used the investors’ money for his own personal benefit, including to repay other investors.
With respect to the portion of investor funds that he did use to purchase securities, TREBITSCH suffered net trading losses, which he did not disclose to the investors. Rather, TREBITSCH sent the investors false and misleading monthly account statements and tax forms, which purported to show positive annual returns.
During the course of the fraudulent scheme, TREBITSCH solicited more than $8 million from four investors.
* * *
TREBITSCH, 37, of Brooklyn, New York, pled guilty to one count of securities fraud, which carries a maximum sentence of 20 years in prison, a maximum fine of $5 million, or twice the gross gain or loss from the offense. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. As part of the plea agreement, TREBITSCH agreed to pay forfeiture and restitution to the victims of the offense in the amount of $5,905,949. TREBITSCH is scheduled to be sentenced by Judge Broderick on November 2, 2015, at 10:00 a.m.
Mr. Bharara praised the work of the Federal Bureau of Investigation.
The charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Daniel S. Goldman and Amy Lester are in charge of the prosecution.
Brentwood Man Pleads Guilty to Bankruptcy FraudRead the Press Release
Michael Ross Smith, 44, of Brentwood, Tenn., pleaded guilty today to making a false material statement under oath in a bankruptcy case, announced David Rivera, U.S. Attorney for the Middle District of Tennessee.
During the plea hearing, Smith acknowledged that he filed for bankruptcy and then committed bankruptcy fraud by providing false testimony, under oath, during an examination conducted by the U.S. Trustee. Smith falsely testified that he was no longer employed by a Nashville business at the time of the examination. Subsequently, the United States Trustee discovered that Smith continued to be employed by the business as the President of Sales, earning an annual base salary of $150,000.
Bankruptcy fraud carries a maximum penalty of 5 years in prison and a $250,000 fine. Smith will be sentenced on August 5, 2015.
The U.S. Trustee Program is the component of the Department of Justice that protects the integrity of the bankruptcy system by overseeing case administration and litigation to enforce the Bankruptcy Code.
This investigation was conducted by the FBI with assistance from the U.S. Trustee. The government is represented by Assistant U.S. Attorney Stephanie N. Toussaint and Special Asst. U.S. Attorney Lloyd E. Mueller.
Bay Area Man Sentenced to Prison for Coercion of Minors for ProstitutionRead the Press Release
SAN FRANCISCO – Omar Ahmad was sentenced to 63 months in prison for coercing and enticing two underage boys to engage in prostitution, announced United States Attorney Melinda Haag and FBI Special Agent in Charge David J. Johnson.
Ahmad, 29, of San Jose, pleaded guilty on April 2, 2015 to a superseding information charging him with one count of coercion and enticement of two male minors to travel interstate for commercial sexual activities. According to the plea agreement, Ahmad admitted that between October 2011 and September 2012, he traveled from California, to Las Vegas, Nevada, on two or three occasions in connection with the crime. On at least one occasion before leaving for Las Vegas, he attempted to knowingly persuade, entice, and induce the two male victims to travel from San Jose, California, to Las Vegas for the purpose of engaging in prostitution. Ahmad attempted to entice the minors by telling them of the amenities and opportunities available in Las Vegas. Ahmad also admitted the government could prove that both male victims were under the age of 18 at the time he attempted to persuade them to travel for prostitution.
Ahmad, was indicted by a federal grand jury on June 12, 2013. Initially, he was charged with two counts of sex trafficking of a minor, in violation of 18 U.S.C. § 1591; two counts of production of child pornography, in violation of 18 U.S.C.§ 2251, and one count of distribution of child pornography, in violation of 18 U.S.C. § 2252. The superseding information charging Ahmad with one count of coercion and enticement of travel for prostitution, in violation of 18 U.S.C. § 2422(a), was filed April 2, 2015. Ahmed has been in custody since his arrest in August 2013.
The sentence was handed down by the Honorable James Donato, U.S. District Judge, following Ahmad’s plea of guilty to the charge in the superseding information. Judge Donato also sentenced the defendant to a seven-year period of supervised release following his prison term, the first 12 months of which must be served under house arrest; to pay restitution to each of his victims in the amount of $2000 a piece (for a total restitution of $4000); and to register as a sex offender. The defendant will begin serving the sentence immediately.
Assistant U.S. Attorney Amie Rooney is prosecuting the case with the assistance of Laurie Worthen and Nina Burney. The prosecution is the result of an investigation by the FBI and the San Jose Police Department Human Trafficking Task Force.
Anyone who suspects instances of human trafficking are encouraged to call the FBI or the Human Trafficking Hotline at 1-888-373-7888. Anonymous calls are welcome.
In addition, suspected child sexual exploitation or missing children may be reported to the National Center for Missing & Exploited Children, via its toll-free 24-hour hotline, 1-800-843-5678.
Alien Deported Multiple Times Sentenced to Time Served for Illegally Returning to U.S.Read the Press Release
PITTSBURGH - An alien found in Armstrong County, Pennsylvania, has been sentenced in Pittsburgh to time served on his conviction of illegal re-entry after deportation, United States Attorney David J. Hickton announced today.
United States District Judge Cathy Bissoon imposed the sentenced on Ivan Villegas-Estrella, 26, of Mexico.
According to the information presented to the court, Ivan Villegas-Estrella, an alien, was formally removed from the United States by United States Immigration and Customs Enforcement on or about Sept. 21, 2008, March 19, 2009, Nov. 16, 2013, April 11, 2014, and April 24, 2014. Ivan Villegas-Estrella was found to be illegally present in Freeport, Pa., on May 12, 2015.
Assistant United States Attorney Paul E. Hull prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the U.S. Department of Homeland Security, Immigration and Customs Enforcement for the successful prosecution of Ivan Villegas-Estrella.
Albuquerque Man Arrested on Federal Child Pornography ChargesRead the Press Release
ALBUQUERQUE – Patrick M. Lopez, 47, of Albuquerque, N.M., was arrested on July 10, 2015, on federal child pornography charges. Lopez made his initial appearance in federal court earlier today. He remains in custody pending a preliminary hearing and detention hearing, both of which currently are scheduled for tomorrow morning.
The criminal complaint charges Lopez with possession of visual depictions of minors engaged in sexually explicit conduct. The charges against Lopez arise from an investigation by the FBI and the Bernalillo County Sheriff’s Office (BCSO). On July 10, 2015, the FBI and BCSO executed a federal search warrant at Lopez’s residence. During the search, forensic examiners found videos consistent with child pornography that had been downloaded onto a laptop computer.
If convicted on the charges in the criminal complaint, Lopez faces a federal prison term of up to ten years. Lopez also would be required to register as a sex offender. Charges in criminal complaints are merely accusations and criminal defendants are presumed innocent unless found guilty beyond a reasonable doubt.
This case was investigated by the Albuquerque office of the FBI and the BCSO, both members of the New Mexico Internet Crimes Against Children (ICAC) Task Force. The case is being prosecuted by Assistant U.S. Attorneys Shammara H. Henderson and Sarah Mease as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice (DOJ) to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and DOJ’s Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
The case also was brought as a part of the New Mexico ICAC Task Force’s mission, which is to locate, track, and capture Internet child sexual predators and Internet child pornographers in New Mexico. There are 82 federal, state and local law enforcement agencies associated with the New Mexico ICAC Task Force, which is funded by a grant administered by the NMAGO. Anyone with information relating to suspected child predators and suspected child abuse is encouraged to contact federal or local law enforcement.
Alabama Man Pleads Guilty to Involvement in Stolen Identity Refund Fraud SchemeRead the Press Release
A Montgomery County, Alabama, resident pleaded guilty to one count of mail fraud and one count of aggravated identity theft for his involvement in a stolen identity refund fraud (SIRF) scheme, Acting Assistant Attorney Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney George L. Beck Jr. of the Middle District of Alabama announced today.
According to court documents, Jerome Marcel Newton obtained the personal identifying information of others in various ways, including by paying other individuals to collect multiple identities or by recruiting people to provide their identities to him. Although Newton resided in Alabama, a number of the identities were of people living in Pittsburgh. Newton also obtained the identity information of prison inmates from jail records. In 2011, Newton used the identities he obtained to file false tax returns, directing the Internal Revenue Service (IRS) to deposit the fraudulent refunds claimed on those returns into bank accounts that he controlled or onto prepaid debit cards. Some of the prepaid debit cards were then mailed to addresses within the Middle District of Alabama.
Newton’s sentencing hearing has not yet been scheduled. At sentencing, Newton faces a statutory maximum sentence of 20 years in prison and a $250,000 fine for the mail fraud count and a mandatory two-year minimum sentence and a $250,000 fine for the aggravated identity theft count. Newton will also be subject to mandatory restitution.
Acting Assistant Attorney General Ciraolo and U.S. Attorney Beck commended special agents of the IRS – Criminal Investigation and officers of the Sheriff’s Office for Douglas County, Georgia, who investigated the case, as well as Trial Attorneys Jason H. Poole and Michael C. Boteler of the Tax Division and Assistant U.S. Attorney Jonathan S. Ross of the Middile District of Alabama, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts can be found on the division’s website.
Alabama Man Pleads Guilty to Involvement in Stolen Identity Refund Fraud SchemeRead the Press Release
WASHINGTON – A Montgomery County, Alabama, resident pleaded guilty to one count of mail fraud and one count of aggravated identity theft for his involvement in a stolen identity refund fraud (SIRF) scheme, U.S. Attorney George L. Beck, Jr., of the Middle District of Alabama and acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division announced today.
According to court documents, Jerome Marcel Newton obtained the personal identifying information of others in various ways, including by paying other individuals to collect multiple identities or by recruiting people to provide their identities to him. Although Newton resided in Alabama, a number of the identities were of people living in Pittsburgh, Pennsylvania. Newton also obtained the identity information of prison inmates from jail records. In 2011, Newton used the identities he obtained to file false tax returns, directing the Internal Revenue Service (IRS) to deposit the fraudulent refunds claimed on those returns into bank accounts that he controlled or onto prepaid debit cards. Some of the prepaid debit cards were then mailed to addresses within the Middle District of Alabama.
Newton’s sentencing hearing has not yet been scheduled. At sentencing, Newton faces a statutory maximum sentence of 20 years in prison and a $250,000 fine for the mail fraud count and a mandatory two-year minimum sentence and a $250,000 fine for the aggravated identity theft count. Newton will also be subject to mandatory restitution.
U.S. Attorney Beck and acting Assistant Attorney General Ciraolo commended special agents of the IRS – Criminal Investigation and officers of the Sheriff’s Office for Douglas County, Georgia, who investigated the case, as well as Trial Attorneys Jason H. Poole and Michael C. Boteler of the Tax Division and Assistant U.S. Attorney Jonathan S. Ross, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts can be found on the division’s website.
AIREKO Construction Company Indicted for Violations of the Clean Air ActRead the Press Release
SAN JUAN, Puerto Rico – Rosa Emilia Rodríguez-Vélez, United States Attorney for the District of Puerto Rico, announced today that a the grand jury in San Juan returned a six count indictment against AIREKO Construction Co. The charges are the result of the illegal removal of asbestos during the renovation of the 9th floor of the Minillas North Tower in May 2012.
The grand jury charged AIREKO with five counts of failing to comply with the National Emission Standards for Hazardous Air Pollutants (NESHAP) by failing: (1) to adequately wet the asbestos during the removal; (2) to have a properly trained supervisor on site during the removal; (3) to properly place the asbestos in leak tight bags; (4) failing to properly label the asbestos containing waste material; (5) to properly dispose of the asbestos containing material at an authorized land fill. Count Six charges the defendant with failing to notify immediately the appropriate government agency of the release of a reportable quantity of a hazard substance-asbestos.
The indictment alleges that between Saturday 12 and Sunday May 13, 2012, subcontractors, working within the scope of their employment and at least in part for the benefit AIREKO, removed ceiling materials containing > 1% asbestos and placed the asbestos containing materials in the trash area in back of the Minillas North Tower. The failure to notify charge focuses on conduct of corporate officials who discovered the release of asbestos on Monday May 14, and failed to make the appropriate notifications.
The illegal removal of the asbestos containing ceiling material and transporting it down to the trash area without following the NESHA work practice requirements resulted in the contamination of the entire office building. The building was ordered closed by the Public Building Authority on May 20, 2015. Clean-up required almost one year to complete.
In a related matter, the U.S. Attorney also filed a one count Information charging Edgardo Albino with failing to notify immediately the appropriate government agency of the release of a reportable quantity of a hazard substance-asbestos. Mr. Albino 60, of Caguas, Puerto Rico, is the Vice-President of Operations and Executive Owner of AIREKO. He was the senior AIREKO employee responsible for supervising the ninth floor renovation.
The case was investigated by the U. S. Environmental Protection Agency Region II Criminal Investigation Division. The case is being prosecuted by Howard P. Stewart, Senior Litigation Counsel, Environmental Crimes Section of the Department of Justice Washington, D.C., and Assistant United States Attorney Mariana E. Bauzá-Almonte with assistance from Carolina Jordan-García, EPA Region II Criminal Enforcement Counsel.
ACPD Sergeant Charged with Structuring and Making False Statements to the FBIRead the Press Release
CAMDEN, N.J. – An Atlantic City Police Department Sergeant was arrested by special agents of the FBI this morning for allegedly structuring financial transactions to avoid the filing of currency transaction reports and making false statements to federal agents, U.S. Attorney Paul J. Fishman announced.
Kiyia M. Harris, 39, of Egg Harbor Township, is charged by complaint with one count of structuring and one count of making false statements to FBI agents during two interviews in December 2014. She is scheduled to make her initial appearance later today before U.S. Magistrate Judge Karen M. Williams in Camden federal court.
According to documents filed in this case and statements made in court:
Harris was engaged in a personal relationship with a convicted drug dealer, D.W., who was on federal probation. In June 2012, Harris purchased a 1969 Camaro for D.W. in her name and structured the payments for the car in such a manner as to avoid the filing of a Currency Transaction Report (CTR) by the car dealership, and also to obscure D.W.’s involvement in the purchase. Harris caused $17,825 in cash to be deposited in amounts less than $10,000. On June 8, 2012, Harris paid $9,999 to the dealership. By check dated June 11, 2012, which was drawn on one of her personal accounts at TD Bank, Harris paid the balance due on the Camaro.
Some of the monies Harris used to pay for the Camaro were deposited into that same TD bank account on two separate dates at two different TD Bank branches. On June 11, 2012, Harris deposited at the TD Bank branch in Atlantic City $9,926: $3,926 in cash and a $6,000 check dated June 10, 2012 bearing the notation “loan for auto” from J.E., a friend of D.W. who loaned D.W. some of the monies to purchase the Camaro. The following day Harris deposited an additional $3,900 in cash into the same TD Bank account at the bank branch in English Creek, New Jersey.
CTR forms require disclosure of the identity of the individual who conducted the transaction and the individual or organization for whom the transaction was completed. Many individuals involved in illegal activities are aware of these reporting requirements and take active steps to cause financial institutions, including car dealerships, not to file CTRs in order to avoid detection of the movement of large amounts of U.S. currency or currency obtained from illegal activities, including drug trafficking. These steps are referred to as “structuring” and involve making multiple cash payments, deposits or withdrawals in amounts of $10,000 or less on the same day or consecutive days in order to avoid CTR filings.
Harris was interviewed by special agents from the FBI on two occasions in December 2014 about her relationship with D.W. and suspicious financial transactions. Harris made false statements to agents which were material to an ongoing federal drug trafficking and money laundering investigation. She falsely told FBI agents that she had never deposited cash into her bank accounts when, in actuality, from January 8, 2007 through November 26, 2014, Harris had deposited more than $120,000 in cash into her accounts. Harris repeatedly denied having engaged in financial transactions with D.W., when in actuality, Harris had conducted numerous transactions with D.W., including helping him with the purchase of the 1969 Camaro and also paying a $6,500 deposit on a 2012 Harley Davidson motorcycle for D.W. by a check drawn on one of Harris’ personal accounts at T.D. Bank.
Both charges carry a maximum potential penalty of five years in prison and a $250,000 fine on each count.
U.S. Attorney Fishman credited special agents of the FBI’s Newark Division, Atlantic City Resident Agency, under the direction of Special Agent in Charge Richard M. Frankel; the DEA’s Newark Division, under the direction of Special Agent in Charge Carl J. Kotowski; the Atlantic County Prosecutor’s Office, under the direction of Prosecutor James P. McClain; and the Atlantic City Police Department, under the direction of Police Chief Henry White, with the investigation leading to today’s arrest.
He also thanked the N.J. State Police; the Atlantic County Sheriff’s Office; the Bureau of Alcohol, Tobacco and Firearms; U.S. Immigration and Customs Enforcement (ICE)-Homeland Security Investigation (HSI); Cumberland County Sheriff’s Office and the Ventnor, Northfield and Millville police departments for their assistance.
The government is represented by Assistant U.S. Attorney Diana V. Carrig of the U.S. Attorney’s Office Criminal Division in Camden.
The charges and allegations contained in the complaint are merely accusations, and the defendant is considered innocent unless and until proven guilty.
Defense counsel:. James J. Leonard Jr. Esq. of Atlantic City
12 July 2015
Attorney General Lynch Statement on Escape of Joaquin Guzman Loera "Chapo" from Mexican PrisonRead the Press Release
Attorney General Loretta E. Lynch provided the following statement on the escape of Joaquin Guzman Loera "Chapo" from a Mexican prison:
“We share the government of Mexico's concern regarding the escape of Joaquin Guzman Loera ‘Chapo’ from a Mexican prison. In addition to his crimes in Mexico, he faces multiple drug trafficking and organized crime charges in the United States.
“The U.S. government stands ready to work with our Mexican partners to provide any assistance that may help support his swift recapture.”
10 July 2015
Watertown Man Pleads Guilty to Marriage FraudRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
BUFFALO, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that Jasvir Kumar, 45, of Watertown, NY, pleaded guilty to conspiracy to commit marriage fraud, before U.S. District Judge Arcara. The defendant was also sentenced to time served (seven months) in prison.Assistant U.S. Attorney Carol G. Bridge, who handled the case, stated that Kumar, a native and citizen of India, came to the United States on a non-immigrant tourist visa on March 27, 2008. After overstaying his visa and remaining in the U.S. illegally, the defendant conspired with Suhkvinder Chhokar, a naturalized U.S. Citizen, also of Watertown, to marry a U.S. Citizen. This would allow Kumar to apply for lawful permanent resident status. Kumar and Chhokar paid the citizen $10,000.00 to get married and file the paperwork with U.S. Immigration Citizenship and Immigration Services (USCIS).
The defendant submitted staged photos and false affidavits to support his fraudulent marriage claim. When Kumar appeared with his “wife” in the Buffalo USCIS office on December 3, 2014 for a green card interview, his “wife” admitted to the fraudulent marriage. The defendant was immediately arrested and detained. Kumar was ordered deported from the U.S. at an immigration hearing on February 24, 2015.
Charges are pending against co-defendant Suhkvinder Chhokar. The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
The plea is the result of an investigation by U.S. Citizenship and Immigration Services, Fraud Detection and National Security Unit, under the direction of District Director Edward Newman and Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Acting Special Agent in Charge J. Michael Kennedy.Washington State Construction Company Settles Allegations of False Claims in Disadvantaged Business Enterprise ProgramRead the Press Release
Tri-State Construction, a privately-owned Washington State construction company, today agreed to pay more than $140,000 to settle allegations it submitted false records to the Washington State Department of Transportation related to the federally-funded I-5 HOV lane project between Port of Tacoma Road and the Pierce/King County line, announced U.S. Attorney Annette L. Hayes. The settlement involves Tri-State’s claims from 2010 to 2014 that it was renting a specialized machine from a certified Disadvantaged Business Enterprise (DBE). In fact, the machine was not owned by DBE – OMA Construction. The machine was actually owned by Tri-State, which attempted to use a lease/purchase agreement to make it appear, consistent with DBE set-aside requirements for federally-funded highway projects, that OMA owned the machine.
“Disadvantaged Business Enterprise fraud harms the integrity of the DBE program and law-abiding contractors by defeating efforts to ensure a level playing field in which all firms can compete fairly for contracts,” said William Swallow, Regional Special Agent-in-Charge of the U.S. Department of Transportation Office of Inspector General. “Our agents will continue to work with the Secretary of Transportation and other Federal, State, and local law enforcement and prosecutorial colleagues to expose and shut down DBE fraud schemes that adversely affect public trust and DOT-assisted highway programs.”
In all Tri-State will pay $142,440 to the U.S. Department of Transportation to settle the allegations. The company does not admit any misconduct. The machine at issue is a “chitosan” – used to process and clean wastewater generated by construction projects. The adequacy of Tri-State’s work on the I-5 project is not disputed.
The case was investigated by the U.S. Department of Transportation Office of Inspector General and the FBI. The case was handled by Assistant United States Attorneys Kayla Stahman and Priscilla Chan.
Washington D.C. Man Sentenced on Drug Trafficking and Firearm ChargesRead the Press Release
ALEXANDRIA, Va. – Keith Pyndell, 34, of Washington, D.C., was sentenced today to 186 months in prison, followed by five years of supervised release for conspiracy to distribute 280 grams or more of cocaine base, aka crack cocaine, and for possession of a firearm in furtherance of a drug trafficking crime. In connection with this conviction, Pyndell forfeited $47,200 in cash that was seized from his residence by the DEA.
Pyndell pleaded guilty on March 16, 2015. According to court documents, Pyndell ran an organization that distributed over 280 grams of cocaine base to customers in Northern Virginia, Maryland, and Washington D.C. Through his organization, Pyndell employed individuals as runners to deliver drugs to his customers and to return cash to him. One of those individuals, Angela Lemons, previously pleaded guilty to conspiring to distribute cocaine base and was sentenced to serve 40 months in prison followed by three years of supervised release. Pyndell admitted that a handgun with an obliterated serial number that was seized from his residence was used for protection in connection with his drug trafficking.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Karl C. Colder, Special Agent in Charge for DEA’s Washington Field Division, made the announcement after sentencing by U.S. District Judge Anthony J. Trenga. Assistant U.S. Attorney Whitney Dougherty Russell is prosecuting the case.
The case was investigated by the DEA’s Washington Office as part of the Organized Crime Drug Enforcement Task Force (OCDETF). The OCDETF program is a federal, multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations. 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.
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-24.
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United States Files Enforcement Action against Iowa Dietary Supplement Company and Principals to Stop Distribution of Adulterated and Misbranded Dietary SupplementsRead the Press Release
The United States filed a civil complaint today in federal court against Iowa Select Herbs LLC, of Cedar Rapids, Iowa, its president and CEO, Gordon L. Freeman, and a partial owner, Lois A. Dotterweich, to prevent the distribution of adulterated and misbranded dietary supplements, announced Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division.
Iowa Select Herbs LLC manufactures and distributes a variety of dietary supplements, consisting primarily of extracts from various plants, including papaya leaf, echinacea, elderberry and nettle leaf. The firm also produces a product called “Cold BeGone,” which purports to be a complex of natural ingredients. The complaint alleges that the company’s dietary supplements are manufactured under conditions that are inadequate to ensure the safety of its products and also make unlawful claims to treat or prevent diseases. The department filed the injunction action in the Northern District of Iowa on behalf of the U.S. Food and Drug Administration (FDA).
“The Department of Justice is committed to ensuring that dietary supplements are manufactured and distributed in compliance with the law,” said Principal Deputy Assistant Attorney General Mizer. “We will pursue actions against manufacturers who do not manufacture their products under proper conditions or who make unlawful claims about them.”
According to the complaint, an FDA inspection performed in August 2014 revealed that the company’s dietary supplements are adulterated within the meaning of the federal Food, Drug and Cosmetic Act because they are manufactured, prepared, packed or held in a manner that does not conform to Dietary Supplement Current Good Manufacturing Practices. The complaint alleges, for example, that the company repeatedly failed to test its dietary ingredients, in order to verify their identity, before using them. The complaint also alleges that the firm’s dietary supplements qualify as unapproved and misbranded drugs, in that they claim to treat or prevent a variety of diseases, including cancer, malaria and heart disease, but have never been submitted to the FDA for approval, and have never been found safe and effective for those purposes.
The government is represented by Trial Attorney Heide L. Herrmann of the Civil Division’s Consumer Protection Branch, with the assistance of Associate Chief Counsel for Enforcement Laura Akowuah of the Department of Health and Human Services’ Office of General Counsel – Food and Drug Division.
A complaint is merely a set of allegations that, if the case were to proceed to trial, the government would need to prove by a preponderance of the evidence.
U.S. Attorney Wendy J. Olson Issues Statement on Building Resilient CommunitiesRead the Press Release
U.S. Attorney Wendy J. Olson today announced the beginning steps of a grass roots effort to form a community and law enforcement coalition to build stronger, safer communities.
“Strong communities are safe communities,” said Olson. “We need to make our community resilient against threats posed by violent crime, violent extremism and on-line predators. When law enforcement, community groups, faith community leaders, business leaders and government officials work together, we more effectively prevent and reduce crime and make Idaho a better place to live.”
Olson said that on July 8, representatives from the refugee community, refugee support agencies, Muslim community, Boise Police Department, FBI, Intermountain Fair Housing Council, ACLU, and Stand Up America met with representatives from her office and discussed community responses to recent incidents in Idaho and across the country. “We are at a critical time in our nation and in our own community – from the shooting at the Emanuel AME Church in Charleston, to anti-refugee and anti-Muslim sentiments expressed by groups and individuals in Idaho, to defiance in parts of some states to the Supreme Court’s decision to legalize same sex marriage in Obergefell v. Hodges,” said Olson. “There are many currents that seek to divide communities. Instead, we have to come together. We need to stand up and form strategies against those who espouse extremist ideologies and recruit others to engage in violent acts in our communities on their behalf. We want to mentor our young people, educate parents, identify solutions, and form closer relationships between refugees and Idahoans who have been here for generations.”
Olson said that an immediate objective of the July 8 meeting was to reassure members of the refugee community and Muslim community that with the federal terrorism trial in United States v. Kurbanov scheduled to begin July 13, law enforcement officers will be vigilant to protecting them against bias crimes.
“To be certain, international terrorism and the conduct of those who are inspired by international terrorist groups to engage in violent conduct pose a serious threat to every community in this nation,” said Olson. “Law enforcement agencies and my office will be deliberate and thorough in pursuing such criminal cases. But we also take great care to ensure that individuals are investigated and prosecuted based on specific illegal acts, not based on how they appear, or how they worship or where they are from. Nor should investigation and prosecution of one person provide inspiration for others to act out against refugees or Muslims or to act out in support of extremism inspired by Al Qaeda or ISIL or other terrorist groups.”
Olson said that attendees at the July 8 meeting supported efforts for further outreach and education to build a resilient community. “There is clear support that a broader coalition would provide safer communities in two ways. First, it would provide tools for early awareness of a person being radicalized to commit a violent act, regardless of the ideology promoting the violence. Second, it would empower community members and allow us to stand together as a community in support of those who are targeted as victims, just as the white community in Charleston stood with the Emanuel AME congregation.”
Olson said that plans are being made for future building resilient communities sessions and invited interested participants to contact her office.
Two Florida Men Indicted on Federal Charges Stemming from Health Care Fraud SchemeRead the Press Release
WASHINGTON – Russell J. Sveda, 69, and Richard V. Schachter, 55, of Lauderdale-By-the-Sea, Fla., have been indicted for conspiracy, health care fraud, and related charges stemming from a scheme to submit false claims for non-existent medical reimbursements through the U.S. Office of Personnel Management’s Foreign Service Benefit Plan.
The indictment, which was returned in the U.S. District Court for the District of Columbia, was announced today by Acting U.S. Attorney Vincent H. Cohen, Jr.; Patrick E. McFarland, Inspector General for the Office of Personnel Management (OPM); Andrew G. McCabe, Assistant Director in Charge of the FBI’s Washington Field Office, and David M. McGinnis, Acting Inspector in Charge of the U.S. Postal Inspection Service’s (USPIS) Washington, D.C., Division.
Sveda and Schachter were arrested today in Florida and they made their first court appearances this afternoon in the U.S. District Court for the Southern District of Florida. Both were named in a 24-count indictment, unsealed today, that charges them with conspiracy, health care fraud, mail fraud, false claims, false statements, and theft. The indictment also includes forfeiture allegations seeking all proceeds that can be traced to the scheme. The defendants are scheduled to appear in the U.S. District Court for the District of Columbia on July 23, 2015.
According to the indictment, Sveda, a retired U.S. Department of State employee, was enrolled in the Foreign Service Benefit Plan, as his health care benefit program, with Coventry as the insurance administrator. Between January 2007 and January 2013, the indictment alleges, Sveda and Schachter attempted to obtain from Coventry approximately $599,000 in reimbursements for overseas pharmacy purchases and $637,000 in reimbursements for overseas medical care, for an approximate total of $1.2 million. The indictment charges that Sveda and Schachter submitted materially false and fraudulent claims and invoices, with most of the claims being submitted under the name of Sveda, in the care of Schachter. The indictment further charges that claims were false in that they represented that Sveda had purchased and paid for prescription medications and other pharmaceutical items from the Stadt-Apotheke Fussen, a pharmacy in Fussen, Germany, and that he had received and paid for health care items and medical services from doctors, hospitals, clinics, and other medical providers in the German cities/towns of Fussen, Bad Liebenstein, Bad Salzungen, Bad Ems, Baden, Schweina, and other locations in Germany.
Finally, the indictment states that after obtaining funds as reimbursements for medical expenses supposedly incurred, Sveda and Schachter used these funds, in part, to help finance joint travel around Europe and to pay for other joint expenditures wholly unrelated to medical services.
An indictment is merely a formal charge that a defendant has committed a violation of criminal laws and every defendant is presumed innocent until, and unless, proven guilty.
In announcing the charges, Acting U.S. Attorney Cohen, Inspector General McFarland, Assistant Director in Charge McCabe, and Acting Inspector in Charge McGinnis expressed appreciation for the work performed by Special Agents and analysts from OPM’s Office of Inspector General and the FBI, and Postal Inspectors and analysts with the U.S. Postal Inspection Service. They also expressed appreciation for the assistance provided by the Office of the Inspector General for the Social Security Administration. In addition, they acknowledged the efforts of those who are working on the case from the U.S. Attorney’s Office, including Paralegal Specialists Donna Galindo, Kristy Penny, John Lowell, Jessica Mundi, and Corinne Kleinman, Assistant U.S. Attorneys Ted Radway and Diane Lucas, and Assistant U.S. Attorney Virginia Cheatham, who is prosecuting the case.
Twenty people indicted for conspiracy that brought heroin and cocaine to Akron from New YorkRead the Press Release
Twenty people were indicted for their roles in a conspiracy in which kilogram-quantities of heroin and cocaine went from New York to Akron and then were throughout Northeast Ohio by drug dealers, law enforcement officials said.
Named in the 51-count indictment are: Emery Lee, 60, of Akron; Angel Pichardo-Martinez, 30, of the Bronx, N.Y.; Lesley Pichardo Feliz, 29, of the Bronx, N.Y.; Antoine Dortch, 25, of Akron; Ailyson Clipper, 29, of Akron; Leardrus Burris, 31, of Cuyahoga Falls; Ronnie Johnson, Jr., 44, of Mentor; Larry Smoot, 34, of Akron; Kyle Ballard, 30, of Akron; Collie Brooks, 51, of Akron; George Locke, Jr., 58, of Akron; Demond Baker, 39, of Akron; Tyrone Allen, 54, of Akron; Rhonda Collins, 46, of Akron; Sharae Ramsey, 25, of Akron; David Robinson, 38, of Akron; Divine Daniels, 24, of Akron; Orlando Reed, 43, of Akron; Reginald Blair, 44, of Akron; and Larry Dixon, 57, of Akron.
The charges include conspiracy to possess with the intent to distribute and distribution of cocaine and heroin in Count 1, and with use of a telecommunication facility to facilitate a drug trafficking offense in Counts 15-51. Blair is charged with possession with the intent to distribute heroin in Counts 2 and 3, possession with the intent to distribute cocaine in Count 5 and being a felon in possession of a firearm and ammunition in Count 12.
Lee is charged with possession with the intent to distribute heroin in Counts 4 and 8, possession with the intent to distribute cocaine in Counts 6, 7, and 9, and being a felon in possession of a firearm and ammunition in Count 13. Burris is charged possession with the intent to distribute heroin in Count 10 and being a felon in possession of a firearm and ammunition in Count 11. Collins is charged with being a felon in possession of a firearm and ammunition in Count 14.
Lee obtained heroin and cocaine from Pichardo-Martinez, Pichardo Feliz and others. Lee then provided the drugs to others named in the indictment for distribution. This took place dating back to 2010, according to the indictment.
The investigation was conducted by members of the Akron/Summit County HIDTA Initiative, and included assistance by the Summit County Sheriff’s Office, Akron Police Department, Barberton Police Department, Copley Police Department, Cuyahoga Falls Police Department, New Franklin Police Department, Ohio State Highway Patrol, Reminderville Police Department, Springfield Twp. Police Department, Stow Police Department, Summit County Prosecutor’s Office, Tallmadge Police Department, University of Akron Police Department, Drug Enforcement Administration, and Federal Bureau of Investigation.
The case is being prosecuted by Assistant United States Attorney Teresa L. Riley.
This investigation has resulted in the recovery of six firearms, a Kevlar vest, ammunition, cocaine, crack cocaine, heroin, and U.S. currency.
If convicted, the defendants’ sentences will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Three Sentenced to Prison This Week in Montana Meth ConspiracyRead the Press Release
MISSOULA – A federal judge sentenced three defendants this week for a methamphetamine conspiracy in Montana. Robert Anthony Vaughn, 37, of Bozeman, Montana, was sentenced today to 46 months in federal prison, followed by three years of supervised release, for conspiracy to possess meth with the intent to distribute. Two other defendants in the conspiracy were also sentenced this week for the offense. Zachary Ryan Mills, 34, and Tracy Ann Hohenstatt, 45, both from Phoenix, Arizona, were each sentenced to five years in prison, followed by five years of supervised release. An additional defendant, Janet Jorgenson Card, was sentenced to five years in prison followed by three years of supervised release. Chief U.S. District Court Judge Dana Christensen presided over the proceedings.
In an Offer of Proof filed by Assistant U.S. Attorney Paulette Stewart, the government stated that if the case had proceeded to trial, the government would have proven that from summer 2012 until roughly Fall 2013, Card received methamphetamine from Mills and Hohenstatt. Mills and Hohenstatt would drive the meth from the Phoenix, Arizona, area to Three Forks, Montana. Card then distributed the methamphetamine to others in the area, including Vaughn. Card estimated that she received 3600 grams from Mills and Hohenstatt. Law enforcement interviewed Vaughn, who stated that he purchased methamphetamine from Card for approximately nine months at her Three Forks residence for a total of 350 grams. Law enforcement seized additional meth and two loaded firearms from Mills and Hohenstatt.
Assistant U.S. Attorney Paulette Stewart prosecuted the cases. The crimes were investigated by the FBI, DEA and the Missouri River Drug Task Force. The defendants will have to serve at least 85% of their sentences before being released from federal prison.
Three Men Indicted in $1.7 Million Mortgage Fraud Scheme Involving Baltimore City PropertiesRead the Press Release
Baltimore, Maryland – A federal grand jury indicted three defendants on charges arising from the fraudulent purchase of seven properties in Baltimore, using fraudulent loan documentation and straw purchasers, resulting in losses of over $1.7 million:
Cecil Sylvester Chester, age 68, of Mitchellville, Maryland;
Michael Gerard Camphor, age 59, of Baltimore; and
Christopher Andy Kwegan, age 58, of Randallstown, Maryland.
The indictment was returned on June 24, 2015 and unsealed today upon the arrests of the defendants.
The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Special Agent in Charge Cary A. Rubenstein of the U.S. Department of Housing and Urban Development Office of Inspector General; and Special Agent in Charge Brian Murphy of the United States Secret Service - Baltimore Field Office.
“Mortgage fraud perpetrators steal from lenders that are induced to make loans that will never be repaid and damage neighborhoods when the resulting foreclosures drive down property values,” stated U.S. Attorney Rod J. Rosenstein.
Chester worked as an accountant from an office located on New Hampshire Avenue in Hyattsville, Maryland. Camphor had worked as a real estate agent for a company and also operated a real estate consulting business called Ron Gerard LLC, a/k/a Ron Gerard & Associates. Kwegan worked as a real estate agent for another company and also bought and sold residential properties on his own.
According to the 23 count indictment, from February 2008 to July 2009, the defendants identified houses in Baltimore that were for sale, many of which had been purchased and renovated by co-conspirator Andreas Tamaris. Tamaris owned and operated a company that purchased and renovated row homes in the Highlandtown neighborhood of Baltimore City. The three defendants set the purchase price for the properties to exceed their actual fair market value, thereby generating excess proceeds from the transactions from which they could profit.
Chester and Camphor persuaded individuals who were inexperienced with residential real estate transactions to allow them to use their names, identifying information and credit histories to purchase Baltimore row houses owned by Tamaris or otherwise located by the conspirators. The indictment alleges that Chester and Camphor advised these “straw purchasers” that they didn’t need to contribute funds for the down payment or closing costs to buy these properties. Chester and Camphor also advised that they would place tenants in the properties whose rent payments would cover the monthly mortgage payments after the transactions closed, and that Chester and Camphor would collect the rent, manage the tenants and make the mortgage payments.
Chester and Camphor are alleged to have provided false information about the straw purchasers’ employment, income and financial assets, as well as false and fraudulent supporting documentation to the mortgage loan brokers to enable the straw purchasers to qualify for home mortgage loans. Chester and Camphor falsely indicated to the mortgage loan brokers that the straw purchasers each intended to use the property as their primary residence following the purchase. Tamaris and other individuals, including Kwegan, supplied the funds needed for the down payment and closing costs on each of the transactions, and were in turn reimbursed from the loan proceeds at settlement.
The indictment alleges that following the settlement on each transaction in which they participated, the three defendants received substantial payments drawn from the proceeds of the loan. Few, if any, payments were made towards the mortgages, and each of the seven properties went into foreclosure, resulting in a loss of at least $1.7 million.
The indictment seeks forfeiture of at least $1,571,631 from Chester, $962,274 from Camphor and $242,500 from Kwegan.
All three defendants face a maximum sentence of 30 years in prison and a $250,000 fine for conspiring to commit wire and mail fraud and for wire fraud. Chester and Camphor also face a maximum sentence of 30 years in prison and a $250,000 fine for mail fraud. An initial appearance was held for Kwegan yesterday, and Camphor’s initial appearance is scheduled for 3:00 p.m. today, in U.S. District Court in Baltimore. Chester is expected to have his initial appearance in federal court in New York today.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
In a related proceeding involving two of the properties at issue in the instant case, co-conspirator Andreas E. Tamaris, age 44, of Bel Air, Maryland, previously pleaded guilty to one count of conspiracy to commit mail and wire fraud, and awaits sentencing.
The Maryland Mortgage Fraud Task Force was established to unify the agencies that regulate and investigate mortgage fraud and promote the early detection, identification, prevention and prosecution of mortgage fraud schemes. This case, as well as other cases brought by members of the Task Force, demonstrates the commitment of law enforcement agencies to protect consumers from fraud and promote the integrity of the credit markets. Information about mortgage fraud prosecutions is available http://www.justice.gov/usao/md/priorities_financialfraud.html.
Today’s announcement is part of the efforts undertaken in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.
United States Attorney Rod J. Rosenstein commended the FBI , HUD OIG - Office of Investigations and the U.S. Secret Service for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Jefferson M. Gray, who is prosecuting the case.
Three Members of Matusiewicz Family Convicted of Federal Stalking Crimes Resulting in the Murder of Christine BelfordRead the Press Release
WILMINGTON, Del. – A federal jury has convicted David T. Matusiewicz, his mother, Lenore Matusiewicz, and his sister, Amy Gonzalez, of interstate stalking and cyberstalking, in violation of federal law. The jury also found all three defendants criminally responsible for the death of Christine Belford, who was murdered in the lobby of the New Castle County Courthouse by co-conspirator Thomas Matusiewicz on February 11, 2013.
The defendants, who will be sentenced by United States District Judge Gerald Austin McHugh on October 15, 2015, face a maximum sentence of life in prison. Following the completion of any prison term, the defendants face a maximum of three years of supervised release.
The jury’s verdict follows the August 2013 indictment charging David T. Matusiewicz, Lenore Matusiewicz, and Amy Gonzalez with one count of conspiring to commit interstate stalking and cyberstalking, in violation of Title 18, United States Code, Sections 371 and 2261A(1)-(2); two counts of interstate stalking, in violation of Title 18, United States Code, Section 2261A(1); and one count of cyberstalking, in violation of Title 18, United States Code, Section 2261A(2). This appears to be the first federal conviction of any defendant for cyberstalking resulting in death, in violation of the Violence Against Women Act.
According to the indictment and court documents filed in this case and in prior cases, David T. Matusiewicz and Christine Belford were engaged in divorce and child custody proceedings in the Family Court of Delaware in 2007. In August 2007, David T. Matusiewicz and his mother, Lenore Matusiewicz, kidnapped the three young children born of his marriage to Christine Belford and fled to South America. In March 2009, David and Lenore Matusiewicz and the young children were found living in a motor home in Nicaragua. David and Lenore Matusiewicz were arrested and prosecuted in Delaware, and the children were returned to the care of their mother, Christine Belford.
In September 2009, David and Lenore Matusiewicz both pled guilty to crimes relating to their kidnapping of the children. In December 2009, David T. Matusiewicz was sentenced to 48 months in prison to be followed by 5 years of supervision by the United States Probation Office.
In the days following his December 2009 sentencing, David T. Matusiewicz and Lenore Matusiewicz began to orchestrate, from their prison cells, a course of conduct designed to stalk, harass, and intimidate Christine Belford and her children. They enlisted Thomas Matusiewicz, Amy Gonzalez and various other persons in this effort, which stretched from December 2009 to February 2013.
The Matusiewicz family began their stalking campaign by broadly disseminating -- by mail, email, websites, Internet postings, and other means -- false allegations that Christine Belford had, among other things, abused her children, suffered from mental illness and attempted to harm Lenore Matusiewicz. They used a website, posted YouTube videos, and sent letters to Christine Belford’s church, her children’s schools, the family’s neighbors, friends and relatives repeating their false and defamatory allegations. Christine Belford and her children were placed in fear and suffered substantial emotional distress as a result of the Matusiewicz family’s widespread, public dissemination of this false and defamatory information.
In August 2011, the Family Court of the State of Delaware terminated David T. Matusiewicz’s parental rights as to his children with Christine Belford following a multi-day trial. In doing so, the Family Court rejected David T. Matusiewicz’s assertion that Christine Belford was abusing the children, referring to those allegations as “baseless” and “made up.” Following the completion of the Family Court termination of parental rights trial, the Matusiewicz family recruited and used a variety of people to conduct physical and online surveillance of Christine Belford and her children.
After his release from federal custody, David T. Matusiewicz resided in southern Texas, first with Amy Gonzalez and then with Lenore and Thomas Matusiewicz. Between September and November 2012, the United States Probation Office twice denied David T. Matusiewicz’s requests for permission to travel from Texas to New Jersey. On November 9, 2012, David T. Matusiewicz filed a petition to reduce the monthly child support arrearage payments he owed Christine Belford in the Family Court of the State of Delaware. That petition ultimately resulted in the scheduling of the February 11, 2013 court hearing. Christine Belford was ordered to attend that hearing in the New Castle County Courthouse.
On January 8, 2013, David T. Matusiewicz sought and received permission from the United States Probation Office in Texas to travel to Delaware to attend the child support arrearage hearing scheduled for February 11, 2013. David T. Matusiewicz never informed the probation officer that he intended to travel to Delaware with Thomas and Lenore Matusiewicz.
Between February 4 and 7, 2013, David, Lenore and Thomas Matusiewicz traveled from Texas to the Delaware Valley in two vehicles – a Honda Civic and Honda CRV – later found to contain numerous weapons, ammunition, restraints, an electric shock device, several gas cans, a shovel, and numerous pictures of Christine Belford’s children and residence.
On the morning of February 11, 2013, David and Thomas Matusiewicz drove to a parking garage near the New Castle County Courthouse in the Honda CRV, which contained ammunition, a military style knife, three sets of restraints of progressively smaller sizes, a bullet proof vest, an electric shock device, binoculars, and photographs of Christine Belford’s children and residence. After entering the courthouse lobby at approximately 7:30 a.m., David T. Matusiewicz entered and stayed in the security screening line, while Thomas Matusiewicz moved around the lobby, occasionally approaching and talking to David T. Matusiewicz.
Shortly before 8:00 a.m., David T. Matusiewicz passed through courthouse security screening and walked to another floor of the building. Thomas Matusiewicz remained in the lobby, where he shot Christine Belford multiple times as she entered the courthouse lobby, killing her. He then shot Laura Mulford multiple times as she attempted to flee. After a shootout during which he shot and injured two Capitol Police officers, Thomas Matusiewicz died on the sidewalk of the courthouse of a self-inflicted gunshot wound.
On February 15, 2013, Amy Gonzalez filed a petition for custody of Christine Belford’s three children in the New Castle County Courthouse, which houses the Family Court of the State of Delaware. The check written to pay the filing fee to the Family Court was dated February 12, 2013 – the day after the Courthouse murders.
This case was investigated by the Federal Bureau of Investigation and the Delaware State Police, and is being prosecuted by Assistant United States Attorneys Jamie M. McCall, Edward J. McAndrew, and Shawn A. Weede.
Three Bronx Gang Members Sentenced to Life in Prison in Manhattan Federal Court for Racketeering, Murder, Conspiracy to Murder, Attempted Murder, Narcotics, and Firearms ChargesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that CARLOS LOPEZ, 27, was sentenced on July 7, 2015, and FELIX LOPEZ-CABRERA, 25, and LUIS BELTRAN, 27, were sentenced on Wednesday, July 8, 2015, for racketeering, murder, conspiracy to murder, attempted murder, narcotics, and firearms charges. LOPEZ and LOPEZ-CABRERA were each sentenced to life in prison plus 35 consecutive years. BELTRAN was sentenced to life in prison. LOPEZ, LOPEZ-CABRERA, and BELTRAN were sentenced for charges arising out of their involvement, from 2003 through 2012, in the criminal activities of the Bronx Trinitarios Gang (“BTG”), a violent street and prison gang that engaged in drug trafficking and multiple acts of violence, including murder and attempted murder, throughout the New York region. All three were convicted after a 12-week jury trial before U.S. District Judge Paul A. Engelmayer, who imposed the sentences.
In imposing sentence, Judge Engelmayer stated that “it doesn’t get more serious than premeditated murder, murder in cold blood,” and that the murders in this case had left a “permanent hole” in the lives of surviving family members of the murder victims, several of whom spoke at the sentencing hearings about the impact the defendants’ crimes have had on their lives and their families.
According to the Superseding Indictment and evidence admitted at trial:
The BTG operated primarily in the Bronx, New York. It started in the prison system in the late 1980’s and subsequently spread to the streets. LOPEZ-CABRERA was a member, and a leader, of the BTG who directed other members to carry out illegal and other activities as part of the racketeering conspiracy. As part of their membership and participation in that enterprise, LOPEZ-CABRERA and LOPEZ murdered Raffy Tavares and Irving Cruz, both 19, in the vicinity of 81 East 181st Street, Bronx, New York, on May 23, 2010. BELTRAN and LOPEZ-CABRERA murdered Raymond Casul, 23, in the vicinity of 271 West Kingsbridge Road, Bronx, New York, on March 31, 2009. LOPEZ-CABRERA was also involved in the September 4, 2009, murder of David Avila-Gomez, 23, in the vicinity of 15 Mount Carmel Place, Yonkers, New York. CARLOS LOPEZ was also involved in the November 20, 2010, murder of Freddy Polanco, 19, in the vicinity of 75 West 190th Street, Bronx, New York. LOPEZ-CABRERA, LOPEZ, and BELTRAN also carried out multiple assaults and attempted murders of individuals believed to be members of rival gangs, including the Latin Kings, Dominicans Don’t Play, and the Bloods. LOPEZ-CABRERA and LOPEZ also participated in a more than decade-long conspiracy to distribute kilograms of marijuana and crack cocaine in the Bronx. The evidence at trial also showed that LOPEZ-CABRERA, LOPEZ, BELTRAN, and other members of the BTG possessed, brandished, and discharged a number of firearms in connection with their drug trafficking and racketeering activities with the Trinitarios gang.
FELIX LOPEZ-CABRERA was convicted of one count of racketeering; one count of racketeering conspiracy; two counts of conspiracy to murder in aid of racketeering; four counts of murder in aid of racketeering; two counts of assault and attempted murder in aid of racketeering; one count of conspiracy to distribute or possess with intent to distribute 100 kilograms and more of marijuana, 28 grams and more of crack cocaine, quantities of cocaine and oxycodone; two counts of discharging a firearm in furtherance of a crime of violence or a drug-trafficking crime; and four counts of discharging a firearm in connection with the murders of Raymond Casul, Raffy Taveras, Irving Cruz, and David Avila-Gomez.
CARLOS LOPEZ was convicted of one count of racketeering; one count of racketeering conspiracy; two counts of conspiracy to murder in aid of racketeering; three counts of murder in aid of racketeering; one count of assault and attempted murder in aid of racketeering; one count of conspiracy to distribute or possess with intent to distribute 100 kilograms and more of marijuana, 28 grams and more of crack cocaine, quantities of cocaine and oxycodone; two counts of discharging a firearm in furtherance of a crime of violence or a drug-trafficking crime; and three counts of discharging a firearm in connection with the murders of Raffy Taveras, Irving Cruz, and Freddy Polanco.
LUIS BELTRAN was convicted of one count of racketeering conspiracy; one count of conspiracy to murder in aid of racketeering; one count of murder in aid of racketeering; and one count of discharging a firearm in connection with the murder of Raymond Casul.
* * *
In addition to the prison sentences, LOPEZ, LOPEZ-CABRERA, and BELTRAN were sentenced to five years of supervised release.
Since 2009, as part of “Operation Patria” and “Operation Green Haze,” this Office has charged at least 147 members and associates of the Trinitarios Gang.
Mr. Bharara praised the work of the New York City Police Department’s Bronx Gang Squad, the Bureau of Alcohol, Tobacco, Firearms, and Explosives’ Joint Firearms Task Force, the Drug Enforcement Administration, and Immigration and Customs Enforcement’s Homeland Security Investigations.
The case is being handled by the Office’s Violent and Organized Crime Unit. Assistant U.S. Attorneys Jessica Ortiz, Rachel Maimin, Micah W. J. Smith, Nola B. Heller, Sarah Krissoff, and Matthew Laroche are in charge of the prosecution.
Thornton resident sentenced to 97 months in federal prison for pssession of child pornographyRead the Press Release
DENVER – Kevin Dale Harlow, age 55, of Thornton, Colorado, was sentenced earlier this week by U.S. District Court Judge Wiley Y. Daniel to serve 97 months (just over 8 years) in federal prison for possession of child pornography. Following his prison sentence, Harlow was ordered to serve 10 years on supervised release and register as a sex offender. Further, he was ordered to pay $22,000 in restitution to several victims of his crime (children who were pictured in the child pornography). Harlow, a member of a Lutheran Church leading a 6th grade boys confirmation class, possessed 3,257 unique child pornography images and 316 unique child pornography videos.
The sentence was announced by U.S. Attorney John Walsh and U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Denver Special Agent in Charge David Thompson. Harlow was indicted by a federal grand jury in Denver on November 4, 2014. He pled guilty before Judge Daniel on April 23, 2015. He was sentenced on July 7, 2015.
According to the stipulated facts contained in the plea agreement, an ICE HSI special agent, working in an official capacity conducting online undercover investigations, was able to access a specific peer-to-peer file-sharing network. The special agent was able to obtain a list of files reportedly being shared, including 36 files with names indicative of child pornography. Approximately 15 files depicting child pornography were downloaded through the peer-to-peer file-sharing network by the undercover special agent on that date.
During the investigation it was determined that the files were being shared from a residence in Thornton, Colorado. In March 2013, the same undercover agent was able to download an additional 26 files of child pornography that were being made available from the same residence. While the investigation continued, an ICE HSI agent learned that a Sergeant from the Johnstown Police Department had also initiated an investigation related to the specific address targeted by ICE HSI. The Johnstown Sergeant was also using a law enforcement computer to conduct online undercover activities. The Sergeant was able to download over 80 image files and more than 15 video files all consistent with child pornography.
Based on this information, a federal search warrant was obtained and executed at the Thornton residence of Kevin Harlow. It was determined that Harlow was a member of a Lutheran Church and was a leader for the 6th grade boys confirmation class. When the search warrant was executed, Harlow was in the process of downloading child pornography. Numerous computers and digital media were seized during the search warrant execution. The investigation also revealed that the search terms Harlow used included: teens, preteens, girls, boys, and ages such as 7, 9, and 12. Investigators learned he had a preference for images of children between 10 and 14 years old.
The forensic examination of the computers and digital media seized from Harlow reflected that child pornography was possessed on more than 10 of the devices recovered. These devices contained 3,257 unique child pornography images and 316 unique child pornography videos. The National Center for Missing and Exploited Children (NCMEC) reported that 554 of the image files possessed by Harlow depict minor victims previously identified to law enforcement. Some of the material portrayed sadistic or masochistic conduct or other depictions of violence.
“Children are victimized in the production of child pornography, and people who possess child pornography fuel that victimization,” said U.S. Attorney John Walsh. “The tough sentence handed down by the court in this case is further supported by the fact that this defendant was working closely with children and young people at the same time he was engaged in the collection of child pornography.”
“This significant prison sentence represents the serious criminal nature of child pornography, and the resulting permanent trauma inflicted on its young and helpless victims,” said David A. Thompson, special agent in charge of HSI Denver. “Our HSI special agents are specially trained to identify, locate and pursue prosecution against these child predators, and rescue their victims.”
This case was investigated by HSI along with the Johnstown Police Department.
Harlow was prosecuted by Assistant U.S. Attorney Alecia Riewerts, the Project Safe Childhood Coordinator for the District of Colorado.
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 United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Syracuse Man Indicted for Social Security FraudRead the Press Release
SYRACUSE, NEW YORK – Blair A. Taylor, 50 of Syracuse, New York, was arraigned in federal court on July 9, 2015, on various charges related to a scheme to defraud the Social Security Administration (SSA) of more than $87,000, announced United States Attorney Richard S. Hartunian and Edward J. Ryan, Special Agent in Charge, Social Security Administration, Office of Inspector General.
The three-count indictment charges Taylor with theft of government money, making a false statement in an application for Social Security Disability Insurance Benefits (DIB) and concealing employment income while also receiving DIB payments.
The indictment alleges that Taylor applied for DIB in April 2006, claiming he was totally disabled. Between April 2006 and January 2015, SSA paid Taylor approximately $87,138.90. The indictment alleges that Taylor received income from various jobs using a second Social Security number which would have affected his eligibility for benefits. The indictment also alleges that in September 2010 Taylor filed an additional disability claim under the second Social Security number. This included an allegedly false report that he had not previously applied for benefits from SSA.
If convicted, Taylor faces up to ten years in prison on the theft of government money charge, up to five years in prison on the Social Security fraud charges, a forfeiture money judgment of up to $87,138.90, and a fine of up to $250,000.00 for each count.
The charges and allegations in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
This case is being investigated by the Social Security Administration, Office of Inspector General, and is being prosecuted by Assistant United States Attorney Michael F. Perry.
Sunrise Man Sentenced to 20 Years in Prison for Payroll Tax Fraud SchemeRead the Press Release
Sonny Austin Ramdeo, 35, of Sunrise, was sentenced today to 240 months in prison, followed by 3 years of supervised release in connection with a $20 million federal payroll tax fraud scheme. Ramdeo was also ordered to pay restitution in the amount of $21,442,173.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), and Shimon R. Richmond, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), made the announcement.
Ramdeo previously pled guilty to two counts of wire fraud and money laundering, in violation of Title 18, United States Code, Sections 1343 and 1956(a)(1)(B)(i).
According to statements made in court and court records, from as early as 2005, defendant Ramdeo was employed as the payroll supervisor at Promise Healthcare, Inc. (Promise Healthcare) and Success Healthcare Group (Success Healthcare), both of which owned and operated hospital facilities throughout the United States. As payroll supervisor for these two companies, Ramdeo was responsible for overseeing the payment of bi-weekly wages and related payroll taxes for approximately 4,000 employees. While employed as a payroll supervisor, Ramdeo facilitated a $20 million dollar federal payroll tax fraud scheme. To execute this scheme, Ramdeo incorporated PayServ Tax Inc., and thereafter represented to officers and employees of Promise Healthcare and Success Healthcare that his company would handle the transfer of local, state and federal payroll taxes to the proper agencies. Instead of forwarding all of the monies due to the taxing authorities for employee payroll taxes, Ramdeo stole and embezzled the funds resulting in a $21 million dollar underpayment. By stealing the payroll tax money, Ramdeo caused hospitals to lay off employees, adversely impacted the maintenance and operations of seventeen acute care hospitals, jeopardized services provided to patients, challenged investors’ security, and reduced the amount of money the taxing authorities actually collected.
Court records indicate that Ramdeo kept the taxes paid by Promise and Success Healthcare to PayServ for his own personal use. These stolen monies included employee and company wages. Ramdeo used the proceeds from this fraudulent scheme in order to finance a now defunct charter airline company.
U.S. Attorney Ferrer stated, “Sonny Ramdeo abused the trust bestowed upon him as a payroll supervisor. By stealing payroll taxes for his own personal gain, Ramdeo adversely impacted private citizens and companies. His selfish acts were rightly punished with the imposition of a significant federal sentence.”
“Sonny Austin Ramdeo portrayed himself as a business man who promised his clients that he would file and remit payroll taxes to the proper agencies. He didn’t,’ said Michael A. D’Alonzo, Assistant Special Agent in Charge, FBI Miami. “Instead, he was blinded by greed and apparently unconcerned about the plight of the thousands of people he bilked to the tune of $20 million in losses.”
Kelly R. Jackson, Special Agent in Charge, IRS Criminal Investigation, stated, “Sonny Austin Ramdeo was responsible for paying local, state and federal payroll taxes to the proper agencies on behalf of thousands of employees, but instead selfishly stole the money for his own personal use. As seen in this case, the failure to pay over withheld payroll taxes is a serious offense that can have severe consequences for both employers and the employees of the affected businesses. Let Ramdeo’s actions and lengthy sentence serve as a warning to those who are considering similar conduct.”
Mr. Ferrer commended the investigative efforts of the FBI, IRS-CI, and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney Ellen L. Cohen.
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.
Statement from U.S. Attorney Dana Boente on the McDonnell OpinionRead the Press Release
RICHMOND, Va. – Dana J. Boente, U.S. Attorney for the Eastern District of Virginia, provided the below statement regarding today’s opinion issued by the U.S. Court of Appeals for the Fourth Circuit:
“We are pleased with today’s ruling affirming the conviction of former Virginia governor Robert F. McDonnell. I would like to thank the appellate team for their efforts on this very challenging case: Assistant U.S. Attorneys Richard D. Cooke, Michael S. Dry, Jessica D. Aber, Ryan S. Faulconer, and Deputy Chief David V. Harbach II of the Criminal Division’s Public Integrity Section. I would also like to thank special agents with the FBI’s Richmond Division, the Virginia State Police, and IRS-Criminal Investigations for their hard work and commitment to this case.”
Robert F. McDonnell, 60, of Glen Allen, Virginia, was sentenced Jan. 6, 2015, to two years in prison, followed by two years of supervised release, for soliciting and obtaining payments, loans, gifts and other items from Star Scientific, a Virginia-based corporation, and Jonnie R. Williams Sr., Star Scientific’s then chief executive officer, in violation of federal public corruption laws.
A copy of this press release and others related to this case may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No.3:14cr12.
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South Portland Man Pleads Guilty to Gun ChargeRead 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 Sean Johnson a/k/a “Thomas Butler” a/k/a “Wayne Sunderland,” 32, of South Portland, Maine, pleaded guilty yesterday in U.S. District Court to being a felon in possession of a firearm.
According to court records, on May 23, 2015, Johnson pulled alongside another vehicle with two occupants stopped at a traffic light located at the intersection of Payne Road and the Maine Turnpike Approach/Connector Road in Scarborough. Johnson fired a shot into the vehicle missing both occupants and lodging in the driver side door. He fled down Payne Road. A passing motorist reported the incident by calling 9-1-1. Scarborough police officers responded and located Johnson’s vehicle parked in a driveway a short distance away. Johnson was found and arrested hiding in nearby woods. A police K-9 led officers to Johnson’s firearm, a Glock nine millimeter semi-automatic pistol that was buried under leaves near his vehicle. Johnson was prohibited from possessing firearms due to a 2013 felony drug trafficking conviction in Maine.
Johnson faces up to 10 years in prison, a $250,000 fine and three years of supervised release. He will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
This case was investigated by the Scarborough Police Department and the Southern Maine Gang Task Force, which is comprised of comprised of agents and officers from the Federal Bureau of Investigation; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the U.S. Drug Enforcement Administration; U.S. Immigration and Customs Enforcement’s Homeland Security Investigations; and the Portland and Biddeford Police Departments.
Rowlett Man Admits Mailing More Than 400 Hoax White Powder LettersRead the Press Release
DALLAS — A Rowlett, Texas, man, appeared today in federal court this morning before U.S. District Judge Sidney A. Fitzwater and pleaded guilty to an indictment charging several federal felony offenses stemming from the hundreds of white-powder hoax letters he mailed from North Texas, announced John Parker, Acting U.S. Attorney for the Northern District of Texas.
Hong Minh Truong, 67, pleaded guilty to five counts of false information and hoaxes. He faces a maximum statutory penalty of five years in federal prison and a $250,000 fine for each of the five counts. Truong, who has been in custody since July 28, 2014, is scheduled to be sentenced by Judge Fitzwater on October 23, 2015.
According to the factual resume filed in the case, since December 2008, Truong mailed more than 400 hoax letters from the North Texas area to cities across the U.S. and to U.S. Embassies abroad. The initial letters, sent out on December 4, 2008, had a “Dallas, Texas” postmark and contained a white-powder substance. More than 15 batches of hoax letters were sent from the Dallas area from December 2008 to the present. In all but two batches of letters, a white-powder substance was included in the envelope.
The substance contained in the more than 400 letters in this case did not contain Anthrax; however, substantial governmental resources were expended in the response and investigation. Although each response was unique, every response involved multiple agencies dispatching personnel and equipment.
Truong mailed some of the hoax letters to the Mi Escuelita Preschool Crossover, in Dallas; Lockheed Martin Aeronautics in Fort Worth, Texas; the Empire State Building, in New York City; Fenway High School in Boston, Massachusetts; and the Dallas Morning News in Plano, Texas.
The U.S. Postal Inspection Service and the FBI investigated. Assistant U.S. Attorney Errin Martin is in charge of the prosecution.
Richmond Heroin Dealer Sentenced to 23 Years in PrisonRead the Press Release
RICHMOND, Va. – Jerome Russell Lockhart, aka “Rome,” 36, of Chesterfield, Virginia, was sentenced today to a total of 276 months in prison, followed by four years of supervised release, for distributing 38.5 pounds (17.5 kilograms) of heroin, being a felon in possession of a firearm, and for violating the terms and conditions of his supervised release.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Karl C. Colder, Special Agent in Charge of the Drug Enforcement Administration’s (DEA) Washington Field Division; and Colonel Thierry G. Dupuis, Chief of Police for Chesterfield County Police Department, made the announcement after sentencing by U.S. District Judge Henry E. Hudson.
Lockhart pleaded guilty on April 15, 2015, to a criminal information charging him with possession with intent to distribute heroin, and with possession of a firearm by a convicted felon. According to the statement of facts filed with the court, Lockhart began distributing heroin shortly after he was released from federal prison on a prior drug trafficking offense. His sentence was later reduced as a result of the Fair Sentencing Act, and he was released from federal custody in 2010 to begin serving a four year term of supervised release. Lockhart admitted to having distributed 17.5 kilograms of heroin during the last 2 ½ years, which resulted in two known overdoses that did not result in death. Lockhart was sentenced to 240 months on the drug charges, and 120 months on the firearm charge. Those sentences will run concurrently. Lockhart was also sentenced to 36 months for violating the terms and conditions of his supervised release. The 36 months will run consecutive to the 20 years, bringing the total prison time to 23 years.
This case was investigated by the DEA’s Washington Field Division and the Chesterfield County Police Department. Assistant U.S. Attorney Angela Mastandrea-Miller prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:15-cr-0054-001-HEH.
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Prior Felon from Albuquerque Arrested for Violating the Federal Firearms LawsRead the Press Release
ALBUQUERQUE – Jason Blackwood, 42, of Albuquerque, N.M., made his initial appearance in federal court this morning on a criminal complaint charging him with violating the federal firearms laws. Blackwood remains in federal custody pending a detention hearing scheduled for July 13, 2015.
The federal charges against Blackwood were announced by U.S. Attorney Damon P. Martinez, Special Agent in Charge Thomas G. Atteberry of the Phoenix Field Division of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), and Bernalillo County Sheriff Manuel Gonzales III.
Blackwood was arrested this morning on a criminal complaint charging him with being a felon in possession of firearms and ammunition, possession of an unregistered saw-off shotgun, and using and carrying firearms in furtherance of a drug trafficking crime. Blackburn is prohibited from possessing firearms and ammunition because he previously was convicted on a robbery in a California state court.
The complaint alleges that on June 22, 2015, deputies of the Bernalillo County Sheriff’s Office (BCSO) executed a search warrant at Blackwood’s residence in the northeast heights of Albuquerque. During the search, the deputies seized five firearms, including a sawed off shotgun with no serial number, and hundreds of rounds of ammunition. They also seized approximately 41 grams of heroin, two grams of methamphetamine, and narcotics paraphernalia. Also on June 22, 2015, the BCSO also searched a storage unit allegedly used by Blackwood. From the storage unit, the deputies seized three more firearms.
If convicted for being a felon in possession of firearms and ammunition or possession of a sawed-off shotgun, Blackwood faces a statutory maximum penalty of ten years in prison. If convicted for using a firearm in furtherance of a drug trafficking crime, Blackwood faces a mandatory minimum penalty of five years in prison which must be served consecutive to the sentence imposed on other charges. 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 BCSO with assistance from the Second Judicial District Attorney’s Office. Assistant U.S. Attorney Shammara H. Henderson is prosecuting the case.
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.
Partners in Scotts Valley Investment Company Sentenced to Prison for Fraud SchemeRead the Press Release
SAN JOSE – Keith Rode was sentenced yesterday to 70 months in prison and ordered to pay $32,880,811.82 in restitution for his role in an investment fraud, announced United States Attorney Melinda Haag and Federal Bureau of Investigation Special Agent in Charge David J. Johnson. The sentence brings a close the last of the three cases against the partners of Geringer, Luck, and Rode LLC, a Scotts Valley investment company.
Rode, 47, of Los Angeles, along with his co-defendants, John Geringer, 50, of Santa Cruz and Christopher Luck, 58, of Scotts Valley, pleaded guilty in 2014. Each defendant has acknowledged playing a role in an investment fraud scheme: Rode pleaded guilty to one count of mail fraud while Geringer and Luck each pleaded guilty to one count of conspiracy to commit mail and wire fraud, one count of mail fraud, and one count of securities fraud. According to the plea agreements, Geringer, Luck, and Rode, each admitted they made false and misleading statements to induce people to make investments in a fund managed by the partnership. Specifically, at the end of April 2009, Geringer confessed to Rode and Luck that he had been falsifying the investment fund’s trading records for several years. Instead of terminating the fund or reporting Geringer to the authorities, Rode and Luck admitted they continued to recruit investors by making false and misleading statements to members of the public, including that the fund had a positive historical performance and that the fund made diversified equity trades.
In each of their guilty pleas, Geringer, Luck, and Rode acknowledged that these false and misleading statements were necessary to cause new investors to contribute to the fund and to induce existing investors to maintain their investments or furnish more money. The defendants also admitted that new investor money was critical to keeping the fund afloat and that if they were truthful with potential investors, new investors most certainly would have chosen not to invest. The defendants also admitted that this new investor money was used to pay the partners’ salary and bonus payments. In total, between 2003 and 2012, Geringer defrauded investors out of over $50 million. Between May 2009 and 2012, after Geringer confessed the fraud to Luck and Rode, investors were defrauded out of over $30 million.
Geringer, Luck and Rode were indicted by a federal grand jury on December 20, 2012. Each defendant was charged with conspiracy to commit mail and wire fraud, in violation of 18 U.S.C. § 1349; mail fraud, in violation of 18 U.S.C. § 1341; wire fraud, in violation of 18 U.S.C. § 1343; securities fraud, in violation of 15 U.S.C. §§ 78j(b) and 78ff and 17 C.F.R. §§ 240.10b-5 and 240.10b5-2; and money laundering, in violation of 18 U.S.C. § 1957. All the charges were related to the defendants’ conduct at Geringer, Luck, and Rode, LLC.
On January 15, 2015, Luck was sentenced to 130 months’ imprisonment. The sentence was handed down by the Honorable Edward J. Davila, U.S. District Judge, following Luck’s guilty plea to one count of conspiracy to commit mail and wire fraud, one count of mail fraud, and one count of wire fraud. Judge Davila also sentenced Luck to a three year period of supervised release, ordered the defendant to pay restitution in the amount of $32,880,811.82, and ordered him to forfeit $32,880,811.82 to the United States government. Luck began serving his prison term on April 9, 2015.
Geringer was sentenced to 145 months’ imprisonment on June 25, 2015. This sentence also was handed down by Judge Davila following Geringer’s plea of guilty to one count of conspiracy to commit mail and wire fraud, one count of mail fraud, and one count of wire fraud. Judge Davila also sentenced Geringer to a three year period of supervised release, ordered the defendant to pay restitution in the amount of $50,327,484.04, and ordered him to forfeit $50,327,484.04 to the United States government. Geringer will begin serving his prison term on August 20, 2015.
Yesterday, Judge Davila sentenced Rode to 70 months’ imprisonment following Rode’s guilty plea to one count of mail fraud. Judge Davila also sentenced Rode to a three year period of supervised release, ordered the defendant to pay restitution in the amount of $32,880,811.82, and to forfeit $32,880,811.82 to the United States government. Rode will begin serving his prison term on September 3, 2015.
Assistant U.S. Attorney Jeff Schenk is prosecuting the case with the assistance of Nina Williams and Laurie Worthen. The prosecution is the result of an investigation by the Federal Bureau of Investigation.
Owner of New Jersey Aircraft Parts Brokerage Company Indicted for Laundering Scrapped Jet Engine Parts, Filing False Tax ReturnsRead the Press Release
NEWARK, N.J. – A federal grand jury returned a 23-count indictment today against the owner of a Ridgefield, New Jersey, aircraft parts brokering company for his role in a 19-year conspiracy to launder scrapped jet engine parts and for avoiding taxes related to his aircraft parts business, U.S. Attorney Paul J. Fishman announced.
Gideon Vaisman, 75, of Edgewater, New Jersey, was charged with one count of conspiracy to commit mail and wire fraud, nine counts of mail fraud, four counts of wire fraud, one count of conspiracy to commit fraud involving aircraft parts and eight counts of filing false tax returns. Vaisman was previously arrested on May 13, 2013 and charged by complaint with one count of conspiracy to commit wire fraud.
According to the indictment:
Vaisman owned Integrated Technology Corp. from 1989 through 1998, and Tara Technology Corp. from 1998 onward. Both businesses were located in Ridgefield and bought and sold aircraft parts. From 1990 through 2009, Vaisman orchestrated a scheme to defraud Federal Aviation Administration (FAA) repair stations, aircraft parts brokers, aircraft parts end-users and others by using phony documents to resell jet engine parts obtained from scrap metal dealers.
Vaisman, on behalf of Integrated Technology, and later Tara Technology, directly and indirectly purchased vital jet engine parts called “blades” and “vanes” from scrap metal dealers. Afterwards, Vaisman instructed Tara Technology’s general manager, Carmine Coviello, 63, to use his Suffern, New York-based aircraft parts broker and seller company, Shelby Enterprises, to sand and file the parts in order to conceal that they had been scrapped and, on occasion, rejected for repair by an FAA repair station. FAA regulations mandate that only FAA-certified repair stations or certified airframe and power plant mechanics may perform such work on aircraft parts.
Vaisman, Coviello and others also conducted sham sales of the illegally altered blades and vanes to Integrated Technology and Tara Aviation Ltd., an aircraft parts broker and seller incorporated in Tortola, British Virgin Islands, and located in Guernsey, United Kingdom. Despite being listed under a different owner, Tara Aviation was in fact completely controlled and financed by Vaisman. The sole purpose of these sales, which occurred only on paper, was to generate fraudulent trace paperwork for the parts. Trace paperwork documents the history of an aircraft part and includes information such as the part’s manufacturer, the aircraft on which the part was used and how it was used. The paperwork is also employed in determining whether an aircraft or aircraft part has been subject to severe stress or heat as would occur during a major engine failure, accident or fire. Under Vaisman’s direction and without any knowledge of the history of the scrapped parts, Coviello prepared fraudulent trace paperwork certifying that the parts had not been subjected to excessive stress and heat or deemed unsuitable by an FAA repair station.
Vaisman, Coviello and another conspirator stored the blades and vanes in Tara Technology’s warehouse inventory, ultimately selling them to aircraft brokers, airlines and others on behalf of Tara Aviation using the fraudulent trace paperwork.
The indictment also alleges that although Tara Technology and Tara Aviation acted as a single entity and that Vaisman controlled all of Tara Aviation’s operations, provided financing and had complete authority over its inventory and cash flows, he failed to report $14,236,000 in net income from Tara Aviation on his personal tax returns and those of Tara Technology.
The mail and wire fraud conspiracy and substantive charges each carry a maximum term of 20 years in prison and $250,000 fine, or twice the loss caused by the offense. The conspiracy to commit fraud involving aircraft parts carries a maximum term of 15 years in prison and a $500,000 fine, or twice the gross gain or loss caused by the offense. The tax charges each carry a maximum term of three years in prison and a $250,000 fine or twice the loss caused by the offense.
Coviello previously pleaded guilty to an information charging him with conspiracy to commit wire fraud in relation to the scheme. His sentencing is scheduled for Sept.10, 2015.
U.S. Attorney Fishman credited special agents of the U.S. Department of Transportation, Office of Inspector General, under the direction of Special Agent in Charge Douglas Shoemaker, and IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen, with the investigation leading to today’s charges.
The case is being prosecuted by Deputy Chief Scott B. McBride of the U.S. Attorney’s Office’s Economic Crimes Unit in Newark.
The charge and allegations against Vaisman are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Defense counsel: Gerald Krovatin, Esq., Newark
Office Manager Sentenced to Federal Prison for Embezzling More Than $500,000 from Her EmployerRead the Press Release
ROME, Ga. - Judy Elaine Henry has been sentenced to serve three years and one month in federal prison for committing wire fraud in connection with a scheme to defraud Bec-Don, Inc., a company that supplies concrete reinforcing steel and related products to the construction industry.
“This defendant abused her employer’s trust by stealing money from the company account for nearly eight years,” said Acting U.S. Attorney John Horn. “Businesses have the right to expect honest services from their employees, but they should nonetheless be vigilant and adopt protocols to safeguard against internal fraud.”
“The sentencing of Ms. Henry in federal court holds her accountable for her eight years of theft from an employer who trusted her. The FBI, along with the Catoosa County Sheriff's Office, which assisted in the matter, fully understands how these types of thefts can adversely impact the bottom line of the victim company's financial stability,” said J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office.
According to Acting U.S. Attorney Horn, the charges and other information presented in court: Henry was the manager of Bec-Don’s office in Ringgold, Georgia, and was authorized to sign checks on Bec-Don’s account. From approximately 2006 through 2014, Henry embezzled more than $500,000 in company funds by writing checks payable to herself from Bec-Don’s account, and by making false entries in Bec-Don’s checkbook and accounting records to make it appear that the checks had been issued to pay legitimate company expenses. Henry deposited some of the fraudulent checks into her personal account and then used her debit card to spend the stolen money.
Judy Elaine Henry, 50, of Lafayette, Georgia, was sentenced to three years, one month in prison, to be followed by five years of supervised release, and ordered to pay restitution in the amount of $565,005.05. Henry was convicted on these charges on April 23, 2015, after she pleaded guilty.
This case was investigated by the Federal Bureau of Investigation, and the Catoosa County Sheriff’s Department.
Assistant United States Attorney J. Russell Phillips prosecuted the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Rome Division is http://www.justice.gov/usao-ndga.
North Hampton Man Pleads Guilty to Child Pornography PossessionRead the Press Release
CONCORD, NEW HAMPSHIRE: Jeffrey Leblanc, 28, of North Hampton, New Hampshire, pled guilty on Friday in United States District Court for the District of New Hampshire to possessing child pornography, announced Acting United States Attorney Donald Feith.
On August 26, 2014, a search warrant was executed at Leblanc’s residence in North Hampton, New Hampshire. A computer was seized, which was later found to contain approximately 30 videos of child pornography. During an on-scene interview, Leblanc admitted that he had downloaded child pornography to his personal computer.
Leblanc is scheduled for sentencing in October 2015, and faces a maximum prison term of 20 years, to be followed by no less than 5 years of supervised release, lifetime sex offender registration, and a fine of up to $250,000.
The case was investigated by the North Hampton Police Department, in conjunction with the Department of Homeland Security (Homeland Security Investigations), the New Hampshire Internet Crimes Against Children Task Force (NH ICAC), and the Salem Police Department. The case is being prosecuted by Assistant United States Attorney Nick Abramson.
In February 2006, the Department of Justice introduced Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the United States Attorneys Offices, Project Safe Childhood combines federal, state and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Non-Indian Man Charged with Murdering an Indian Man in Ohkay Owingeh PuebloRead the Press Release
ALBUQUERQUE – Jack R. Patterson, Jr., 66, a non-Indian, who resides in the Pueblo of Ohkay Owingeh, N.M., appeared in federal court in Albuquerque, N.M., this morning on a criminal complaint charging him with murder and violating the federal firearms laws. Patterson, who was arrested on July 8, 2015, was ordered detained pending trial.
Antonio Valdez, 24, is charged in a separate criminal complaint with aiding and abetting murder and being an accessory after the face. Valdez, also a non-Indian who resides in the Pueblo of Ohkay Owingeh, has yet to be apprehended and is considered a fugitive.
Patterson is charged with murdering an Indian of the Ohkay Owingeh Pueblo and Northern Cheyenne Tribe who is an enrolled member of the Northern Cheyenne Tribe on the night of May 25, 2015, in Chamita, N.M., which is located in Ohkay Owingeh Pueblo. He also is charged with being a felon in possession of a firearm. Valdez is charged with being an accessory after the fact for allegedly assisting Patterson conceal his crime by helping Patterson bury the victim’s remains in a shallow grave outside Patterson’s residence in Chamita.
The charges against Patterson and Valdez were announced by U.S. Attorney Damon P. Martinez, Special Agent in Charge William McClure of District IV of the Bureau of Indian Affairs (BIA) Office of Justice Services, Special Agent in Charge Carol K.O. Lee of the FBI’s Albuquerque Division, Chief Pete N. Kassetas of the New Mexico State Police and Chief Donovan Trujillo of the Ohkay Owingeh Tribal Police Department.
According to court filings, the charges against Patterson and Valdez are the result of an investigation initiated by the BIA on May 27, 2015, after learning that the Ohkay Owingeh Tribal Police Department received a missing person’s report about the victim. By late June 2015, the investigative team, which grew to include the FBI and New Mexico State Police, had learned that the victim had last been seen in the company of Patterson and Valdez. Witnesses reported hearing gunshots coming from the direction of Patterson’s residence on the night of May 25, 2015. Witnesses also reported hearing that Valdez allegedly killed the victim and that Valdez allegedly claimed to know where the victim was buried.
On July 7, 2015, the investigators executed a federal search warrant at Patterson’s residence. During the search, human remains were found in a grave on Patterson’s property. The remains were identified as those of the victim by tattoos. A rifle, which was loaded with ammunition, was also seized during the search of Patterson’s property. Patterson was prohibited from possessing either firearms or ammunition because of his status as a convicted felon.
If convicted, Patterson faces a maximum penalty of life imprisonment on the murder charge and a maximum penalty of ten years in prison for being a felon in possession of a firearm. If convicted, Valdez faces a maximum penalty of life imprisonment on the murder charge and a maximum penalty of 15 years in prison on the accessory after the fact charge.
Charges in criminal complaints are merely accusations and defendants are presumed innocent unless found guilty beyond a reasonable doubt.
A photograph of fugitive Antonio Valdez is attached to this press release. Anyone with information on the whereabouts of this fugitive is asked to contact the BIA at (505) 455-2295.
The charges against Patterson and Valdez are the result of investigation by the Northern Pueblos Agency of the BIA’s Office of Justice Services, the FBI, the Ohkay Owingeh Tribal Police Department, the FBI’s Evidence Response Team and the New Mexico State Police. Assistant U.S. Attorney Sarah Jane Mease is prosecuting the case.
valdez_photo.docx (42.55 KB)
Nogales Resident Sentenced to 78 Months for Fraudulent Tax Refund SchemeRead the Press Release
TUCSON, Ariz. – On July 8, 2015, Scott William Acorn, 43, of Nogales, Ariz., was sentenced by U.S. District Judge Cindy K. Jorgenson to a total of 78 months imprisonment and ordered to pay $415,000 in restitution. Acorn pleaded guilty on March 31, 2015, to conspiracy, filing false claim for refund, wire fraud, and aggravated identity theft.
Acorn and another individual together acquired the personal identification information (name, birthdate, and social security number) of approximately 1,117 individuals. Using this information, Acorn and his co-defendant electronically filed false tax returns for these individuals seeking refunds of approximately $1,000 on each return. The individuals whose information was used were unaware of the returns being filed in their name. For tax years 2010 and 2011, the conspirators sought over a million dollars in fraudulent refunds which resulted in a payout of $414,000 by the United States Treasury.
Acorn’s sentence was enhanced by his admission that he fled to Mexico while on pre-trial release in 2012 and continued to file false tax returns in much the same manner as before. In September of 2014, he was discovered and returned to the United States to face prosecution.
The investigation in this case was conducted by Internal Revenue Service, Criminal Investigation, Tucson. The prosecution was handled by the U.S Attorney’s Office for the District of Arizona, Tucson.
CASE NUMBER: CR-12-1293-CKJ-JR
RELEASE NUMBER: 2015-051_Acorn
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For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.
Miami-Dade County Resident Pled Guilty to Filing False Refund Claims with the IRSRead the Press Release
A Miami-Dade County resident pled guilty to filing false refund claims with the Internal Revenue Service.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), made the announcement.
Mavys Galvez, 32, of Miami, Florida, pled guilty to one count of making a false, fictitious, and fraudulent claim against the United States, in violation of Title 18, United States Code, Section 287.
According to court documents, Galvez filed false 2006, 2007, 2008 and 2009 amended federal income tax returns with the IRS claiming fraudulent refunds. In the returns, Galvez falsely asserted that she and her husband were owed millions of dollars in income from various entities, and that those entities had withheld the money as federal income tax paid to the IRS. In fact, the entities owed no such income to Galvez or her husband, and withheld no such taxes on their behalf. Specifically, Galvez filed a 2006 amended tax return with her husband claiming a tax refund of $1,049,270 based in large part on claimed income and $810,224 of tax withheld by a bank. The tax return also attached a Form 1099-OID purportedly from the bank reflecting those totals, as well as 1099-OID forms from other entities. The filed 1099-OID forms were false.
Court documents indicate that Galvez had previously filed legitimate tax returns for tax years 2006 through 2009, knew that she and her husband had not received the income from the various entities reported on the fraudulent returns, knew that the taxes claimed had not been withheld, and knew that the 1099-OID forms were false. The total amount of fraudulent refunds claimed by Galvez for tax years 2006 through 2009 is $3,424,834.
Mavys Galvez is scheduled to be sentenced on September 17, 2015 at 1:30 p.m. before United States District Judge William P. Dimitrouleas. At sentencing, the defendant faces a maximum of five years of imprisonment.
Mr. Ferrer commended the investigative efforts of IRS-CI. This case is being prosecuted by Assistant U.S. Attorney John P. Gonsoulin.
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.
Memphis Man Charged with Sex Trafficking of 2 Minors by using Threats, Violence, and Coercion to Compel Girls into Prostitution in New Orleans and ElsewhereRead the Press Release
U.S. Attorney Kenneth A. Polite announced that TIMOTHY JONES, a/k/a “Lucci,” “King Lucci,” “Lucci Loco,” age 25, of Memphis, was charged today in an eight-count Indictment for offenses related to his involvement in the sex trafficking of two minor into the New Orleans area for the purposes of those minors engaging in prostitution.
According to the Indictment, in early December 2013, JONES met and began recruiting Victim 1, a 17-year-old female from Baton Rouge, to work for him as a prostitute. For approximately three weeks, Victim 1 did so. In early January 2014, JONES met Victim 2, a sixteen-year-old female from Memphis and recruited her to work for him as a prostitute. JONES then arranged for Victim 2 to travel first to Louisville, Kentucky, and then to New Orleans, to work for him as a prostitute. JONES required Victim 1 and Victim 2 to give him all of the money they earned from engaging in prostitution. JONES advertised prostitution dates with Victim 1 and Victim 2 using an online classified website. JONES instructed Victim 1 and Victim 2 on how much to charge for sex, how to solicit “dates,” and how to avoid detection by law enforcement. He also instructed them to steal credit cards, wallets, cash, and other valuables from customers.
JONES also used a variety of means to control his victims. Among his techniques, JONES provided them with alcohol and illicit drugs to numb their senses, control their behavior, and encourage them to continue engaging in prostitution. To further coerce his victims, JONES beat them, punched them, and forced them to have sex with him. JONES also beat, punched, and choked others who worked for him as prostitutes in front of Victim 1 and Victim 2 as a means of threatening and intimidating them. When Victim 2 told JONES that she wanted to return to Memphis and stop working for him as a prostitute because she was ill and did not want him to beat her anymore, JONES told her that he would send her home once she earned enough “real” money.
If convicted, JONES faces a mandatory minimum term of imprisonment of fifteen years and a maximum of life, followed by up to a life term of supervised release, and a $250,000 fine. JONES may also be required to register as a sex offender.
“As alleged, Timothy Jones used violence, alcohol, and drugs to coerce underage women into prostitution,” stated U.S. Attorney Polite. “Today’s indictment continues our Office’s heightened efforts in combating human trafficking. Individuals and businesses that profit from these heinous crimes are now on notice.”
U.S. Attorney Polite reiterated that the Indictment is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
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.”
U.S. Attorney Polite praised the work of the New Orleans Field Offices of the Federal Bureau of Investigation and Homeland Security Investigations, with assistance from the Louisiana State Police, in investigating this matter. Assistant U.S. Attorney Jordan Ginsberg is in charge of the prosecution.
Timothy Jones Indictment.pdf (3.46 MB)
Man Charged with Armed Robbery of Shop ‘N Save Pleads GuiltyRead the Press Release
Devante J. Hodges, 22, of Cahokia, IL, plead guilty in the United States District Court to a three-count indictment charging him with Conspiracy to Interfere with Commerce by Robbery, Interference with Commerce by Robbery, and Use of a Firearm During a Crime of Violence, Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today. The Armed Robbery counts arise from the federal Hobbs Act, which makes it a crime to obstruct, delay or affect interstate commerce by robbery, and is used by United States Attorney Wigginton as a way to combat armed robbery in the Southern District of Illinois. Hodges has been in custody since he was charged on February 6, 2015.
Documents filed in the U.S. District Court establish that on January 11, 2015, Hodges, Lemarcus Jackson, Undray Webb, and Byron Holton entered the Shop ‘n Save, located at 1028 Camp Jackson Road in Cahokia, Illinois, masked, gloved and armed with a black handgun, a chrome semi-automatic handgun, a large frame revolver, and a long rifle with a high capacity magazine. Hodges, Jackson, Webb, and Holton pointed the firearms at employees and customers within the store and threatened to kill a customer if they were not given money from the store safe. Holton jumped the service counter and demanded the employees place money from the safe into a black book bag while Hodges, Jackson, and Webb stood guard at the door with their firearms. Hodges, Jackson, Webb and Holton then left the store and fled the area in a vehicle being driven by the getaway driver, Durand Harper.
Hodges was arrested and interviewed by law enforcement. During the interview, Hodges admitted to being one of the four gunmen who robbed the Shop ‘n Save and identified Byron Holton, Undray Webb and Lemarcus Jackson as the other three gunmen and Durand Harper as the getaway driver. Hodges stated he was the masked man with the large frame revolver. Hodges admitted that he receive approximately $1,000 in proceeds from the robbery.
Hodges faces a prison term of up to 20 years, a fine of up to $250,000, and a term of supervised release of up to 3 years on the Hobbs Act violations. On the count of Use of a Firearm During a Crime of Violence, Hodges faces a term of imprisonment of not less than 7 years up to a maximum term of Life, consecutive to, meaning in addition to, any term of imprisonment imposed on the Hobbs Act violations. Sentencing is scheduled for October 27, 2015, in East St. Louis, Illinois.
As to Lemarcus Jackson, Undray Webb, Byron Holton, and Durand Harper, their cases are still pending, thus they are presumed innocent of the charges unless or until proven guilty beyond a reasonable doubt.
The case was investigated by the Cahokia Police Department, the Sauget Police Department and the Federal Bureau of Investigation. The case is assigned to Assistant United States Attorney Ali Summers for prosecution.
Local Insurance Salesman Sentenced on Fraud and Tax ChargesRead the Press Release
St. Louis, MO – PAUL PARKER was sentenced to 36 months in prison involving a scheme to defraud four clients by using their investment funds to pay his expenses and gamble. He also failed to file tax returns during the scheme, in part to avoid reporting his income from the fraud.
According to court documents, Parker held an account in the name of American Investors, Inc. for the purported purpose of receiving funds from clients to purchase life insurance annuities. Rather than purchase annuities on his clients’ behalf, however, Parker spent their money on personal expenses and gambling. In the course of the scheme, Parker also used monies contributed by later clients to fund repayments to prior clients. In total, Parker took in approximately $259,168 through false and fraudulent pretenses, resulting in a loss to investors of approximately $209,168. Parker also admitted to failing to file federal income tax returns for three years from 2010 to 2012.
Parker, St. Louis, Missouri, pled guilty in April to one felony count of mail fraud and three counts of failure to file a tax return. He appeared today for sentencing before United States District Judge Rodney W. Sippel. Parker was also ordered to pay $72,805 to the IRS and the Missouri Department of Revenue for the taxes he failed to pay.
This was investigated by Internal Revenue Service-Criminal Investigation and the Federal Bureau of Investigation. Assistant United States Attorney Richard Finneran handled the case for the U.S. Attorney’s Office.
Lafayette man sentenced to 20 years in prison for child pornography distributionRead the Press Release
LAFAYETTE, La. – United States Attorney Stephanie A. Finley announced today that a Lafayette man was sentenced to 240 months in prison for distributing child pornography to a 16-year-old.
Thomas Dessoye, 54, of Lafayette, was sentenced by U.S. District Judge Elizabeth E. Foote on one count of distribution of child pornography. He was also sentenced to serve 10 years of supervised release and ordered to pay $5,095 in restitution. According to evidence presented at the March 11, 2015 guilty plea, Dessoye began communicating via the internet with a 16-year-old who lived in Minnesota. On October 20, 2012, Dessoye sent the 16-year-old a link to Dessoye’s Dropbox account. Dropbox is an internet site that allows account holders to store images and videos as well as other digital files. The Dropbox account holder can send others a link so they can view material the account holder has stored on the Dropbox account. When Dessoye shared his Dropbox account with the 16-year-old, Dessoye had uploaded videos of child pornography to the Dropbox account. These videos depicted children engaging in sex acts with other children as well as videos depicting adults engaging in sexual acts with children.
According to an affidavit filed in support of the criminal complaint, after distributing child pornography to the 16-year-old, Dessoye traveled from Louisiana to Minnesota without the knowledge or consent of the minor’s parents. He picked up the 16-year-old and transported him back to Louisiana. Shortly after that, the parents of the 16-year-old reported their child missing. The Sherburne County Sheriff’s Office in Minnesota working with the Lafayette Parish Sheriff’s Office used information provided by a cell phone provider to locate the missing child at Dessoye’s residence in Lafayette. The child was then returned to the parents.
“Combating abuse of children is a top priority of this office,” Finley stated. “My office, along with our law enforcement partners, will use every tool available to prosecute these cases to the fullest extent of the law and put child predators behind bars. Our goal is to keep children safe.”
The FBI, Lafayette Parish Sheriff’s Office, and the Sherburne County Sheriff’s Office of Elk River, Minn., investigated the case. Assistant U.S. Attorney Robert C. Abendroth prosecuted the case.
This case is part of Project Safe Childhood, a U.S. Department of Justice nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Those concerned may also leave tips with the FBI at tips.fbi.gov. Tips may be submitted anonymously. The Lafayette FBI office number is (337) 232-2164.
Justice Department Sues Nevada Housing Provider for Discriminating Against Families with ChildrenRead the Press Release
The Justice Department today filed a lawsuit against the owners of rental properties in Carson City, Nevada, alleging violations of the Fair Housing Act. The lawsuit, filed in the U.S. District Court for the District of Nevada, charges that Betty Brinson and Hughston Brinson, the owners of a single-family rental home, discriminated against families with children by placing a series of advertisements in the local newspaper indicating a preference for adult tenants, and by refusing to rent the home to a family with three children because they did not want children living at the property. The suit also alleges that Ms. Brinson placed discriminatory advertisements for another property she owns – a 36-unit apartment complex – indicating a preference for adult tenants.
The lawsuit arose as a result of a complaint filed with the Department of Housing and Urban Development (HUD) by the family who alleged they were refused the opportunity to rent the single-family home because they were a family with children. After HUD investigated the complaint, it issued a charge of discrimination and the matter was referred to the Justice Department.
The lawsuit seeks an order prohibiting the defendants from engaging in future unlawful discrimination. It also seeks the payment of a civil penalty and monetary damages for individuals who were refused the opportunity to rent because their children would be living with them.
“The Fair Housing Act includes important protections for families with children,” said Vanita Gupta, the head of the Civil Rights Division. “The Justice Department will continue its vigorous enforcement of the Fair Housing Act to ensure that families with children do not face discrimination in the housing market and have equal access to housing opportunities.”
“For more than 25 years, the Fair Housing Act has made it illegal for families to be denied housing based on policies that discriminate against children,” said Gustavo Velasquez, Assistant Secretary for HUD’s Fair Housing and Equal Opportunity Office. “HUD will continue to work with the Justice Department to vigorously enforce fair housing laws that protect the right of families with children to live where they choose.”
Fighting illegal housing discrimination is a top priority of the Justice Department. The Federal Fair Housing Act prohibits discrimination in housing on the basis of race, color, religion, sex, familial status, national origin and disability. Visit www.usdoj.gov/crt for more information about the Civil Rights Division and the laws it enforces. Additional information about the Fair Housing Act is available at www.HUD.gov.
Justice Department Announces University of Montana Police Department Has Fully Implemented Agreement to Improve Response to Reports of Sexual AssaultsRead the Press Release
MISSOULA – The Department of Justice announced today that the University of Montana Police Department (UMPD) has fully implemented the requirements of its agreement with the department to improve the UMPD’s response to reports of sexual assault. The agreement, which was entered into in May 2013, resolved part of the department’s comprehensive investigation of the response by the Missoula, Montana, criminal justice system and the University of Montana to sexual assault. Thomas R. Tremblay, the independent reviewer who assesses whether the terms of the agreement have been met, has determined – and the department has agreed – that the UMPD has met all of its obligations under the agreement and achieved the overall purpose of the agreement.
The purpose of the agreement between the department and the UMPD was to better protect and vindicate the rights of sexual assault victims by transforming the UMPD’s response to reports of sexual assault. To do this, the agreement required significant changes to the UMPD’s policies, practices and supervision. These changes promote more reliable sexual assault investigations, and effective, nondiscriminatory law enforcement and community support for victims, the police department and its officers. The UMPD’s implementation of the agreement has resulted in a host of historic advances in the Missoula response to sexual assault, including the following:
- development and institution of model policies and protocols for the UMPD’s response to reports of sexual assault, and for its communication and cooperation with its university and local law enforcement partners;
- extensive specialized training for first responders and detectives in the response to sexual assault;
- cooperation with the development and institution of an External Review Panel – one of the first of its kind – to review closed sexual assault cases for investigative comprehensiveness and indications of gender bias;
- completion of an audit of the community-wide response to sexual assault – one of the first community audits to focus exclusively on sexual assault – including all of the key law enforcement agencies, advocacy organizations and medical service providers serving victims of sexual assault in Missoula County; and
- community advocates and students reporting better communication and coordination with UMPD officers than ever before.
“Our agreement with the University of Montana Police Department following our investigation into the handling of sexual assault complaints made by women in Missoula has been a catalyst for powerful changes in the law enforcement, the university, and the community’s coordinated response to sexual assault,” said Vanita Gupta, the head of the Civil Rights Division. “We are grateful for the efforts of the University of Montana, the UMPD and the entire Missoula community because, as a result of these reforms, the women of Missoula are safer, more trusting of the criminal justice system and subject to more fair and respectful treatment by campus police. The University of Montana and the UMPD had the courage and leadership to acknowledge and address these problems on its campus, and as a result, they are poised to become a model for institutions of higher education and campus police departments grappling with these issues around the country.”
“Today signals a true accomplishment by the University of Montana and its police department,” said U.S. Attorney Michael Cotter of the District of Montana. “They have worked tirelessly toward changes that are substantial, sustainable, and will benefit the community for generations to come. Thanks to this community effort, today the university is safer and is a place where students can learn and thrive.”
The full implementation of the department’s agreement with the UMPD marks the second completion of the four agreements stemming from the department’s multi-pronged investigation, launched in May 2012, regarding the handling of sexual assault complaints made by women in Missoula. The investigation, conducted under the Violent Crime and Law Enforcement act of 1994, the Safe Streets Act, Title VI of the Civil Rights Act of 1964 and Title IX of the Education Amendments of 1972, evaluated the response to sexual assault at the University of Montana at Missoula, the UMPD, the Missoula Police Department (MPD) and the Missoula County Attorney’s Office. The department entered into agreements with the university, the UMPD and the MPD in May 2013, to resolve findings related to those parties and address deficiencies in their response to sexual assaults. The department, together with the Montana Attorney General’s Office, entered into an agreement with the Missoula County Attorney’s Office the following year, in June 2014. The implementation of those agreements has already improved these parties’ response to sexual assaults.
These agreements, as well as a description of the Department of Justice’s work regarding sexual assault in Missoula are available at: http://www.justice.gov/crt/about/spl/. The independent reviewer’s final compliance report, describing in detail his determination that the UMPD has successfully achieved full compliance with the Justice Department agreement, is forthcoming, and will be available on the Justice Department’s website upon its release.
Justice Department Announces University of Montana Police Department Has Fully Implemented Agreement to Improve Response to Reports of Sexual AssaultRead the Press Release
The Department of Justice announced today that the University of Montana Police Department (UMPD) has fully implemented the requirements of its agreement with the department to improve the UMPD’s response to reports of sexual assault. The agreement, which was entered into in May 2013, resolved part of the department’s comprehensive investigation of the response by the Missoula, Montana, criminal justice system and the University of Montana to sexual assault. Thomas R. Tremblay, the independent reviewer who assesses whether the terms of the agreement have been met, has determined – and the department has agreed – that the UMPD has met all of its obligations under the agreement and achieved the overall purpose of the agreement.
The purpose of the agreement between the department and the UMPD was to better protect and vindicate the rights of sexual assault victims by transforming the UMPD’s response to reports of sexual assault. To do this, the agreement required significant changes to the UMPD’s policies, practices and supervision. These changes promote more reliable sexual assault investigations, and effective, nondiscriminatory law enforcement and community support for victims, the police department and its officers. The UMPD’s implementation of the agreement has resulted in a host of historic advances in the Missoula response to sexual assault, including the following:
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development and institution of model policies and protocols for the UMPD’s response to reports of sexual assault, and for its communication and cooperation with its university and local law enforcement partners;
-
extensive specialized training for first responders and detectives in the response to sexual assault;
-
cooperation with the development and institution of an External Review Panel – one of the first of its kind – to review closed sexual assault cases for investigative comprehensiveness and indications of gender bias;
-
completion of an audit of the community-wide response to sexual assault – one of the first community audits to focus exclusively on sexual assault – including all of the key law enforcement agencies, advocacy organizations and medical service providers serving victims of sexual assault in Missoula County; and
-
community advocates and students reporting better communication and coordination with UMPD officers than ever before.
“Our agreement with the University of Montana Police Department following our investigation into the handling of sexual assault complaints made by women in Missoula has been a catalyst for powerful changes in the law enforcement, the university, and the community’s coordinated response to sexual assault,” said Vanita Gupta, the head of the Civil Rights Division. “We are grateful for the efforts of the University of Montana, the UMPD and the entire Missoula community because, as a result of these reforms, the women of Missoula are safer, more trusting of the criminal justice system and subject to more fair and respectful treatment by campus police. The University of Montana and the UMPD had the courage and leadership to acknowledge and address these problems on its campus, and as a result, they are poised to become a model for institutions of higher education and campus police departments grappling with these issues around the country.”
“Today signals a true accomplishment by the University of Montana and its police department,” said U.S. Attorney Michael Cotter of the District of Montana. “They have worked tirelessly toward changes that are substantial, sustainable, and will benefit the community for generations to come. Thanks to this community effort, today the university is safer and is a place where students can learn and thrive.”
The full implementation of the department’s agreement with the UMPD marks the second completion of the four agreements stemming from the department’s multi-pronged investigation, launched in May 2012, regarding the handling of sexual assault complaints made by women in Missoula. The investigation, conducted under the Violent Crime and Law Enforcement act of 1994, the Safe Streets Act, Title VI of the Civil Rights Act of 1964 and Title IX of the Education Amendments of 1972, evaluated the response to sexual assault at the University of Montana at Missoula, the UMPD, the Missoula Police Department (MPD) and the Missoula County Attorney’s Office. The department entered into agreements with the university, the UMPD and the MPD in May 2013, to resolve findings related to those parties and address deficiencies in their response to sexual assaults. The department, together with the Montana Attorney General’s Office, entered into an agreement with the Missoula County Attorney’s Office the following year, in June 2014. The implementation of those agreements has already improved these parties’ response to sexual assaults.
These agreements, as well as a description of the Department of Justice’s work regarding sexual assault in Missoula are available at: http://www.justice.gov/crt/about/spl/. The independent reviewer’s final compliance report, describing in detail his determination that the UMPD has successfully achieved full compliance with the Justice Department agreement, is forthcoming, and will be available on the Justice Department’s website upon its release.
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Jury Finds California Man Guilty of Attempted Methamphetamine Trafficking on KauaiRead the Press Release
HONOLULU – A federal jury found Roman Gabriel Contreras, 44, of Ontario, California, guilty on Monday, July 6, after a three day trial in United States District Court in Honolulu. Contreras was found guilty of attempted possession with intent to distribute of more than 500 grams of a substance containing methamphetamine on Kauai on March 24, 2015.
Florence T. Nakakuni, United States Attorney for the District of Hawaii, said that evidence presented at trial showed that Contreras, utilizing a false name, flew to Lihue airport from Los Angeles International airport on March 24, 2015 with three plastic containers hidden in baggage checked under the fictitious name. Evidence also established that the three containers which held almost three pounds of pure methamphetamine, were discovered after Drug Enforcement Administration (DEA) agents executed a search warrant on March 25th on Contreras’ bags. Evidence also showed that Contreras attempted to avoid a DEA agent and Kauai Police Department Officers after he deplaned the California flight at Lihue airport.
Contreras, who has a prior state felony drug conviction for promoting methamphetamine, faces up to life in prison, with a mandatory minimum 20-year term of imprisonment when he is sentenced by District Judge Derrick K. Watson on October 21, 2015.
The investigation which resulted in the charge in the case was conducted by DEA and the Kauai Police Department. The prosecution was handled by Assistant U.S. Attorney Thomas Muehleck.
Jackson County Man Pleads Guilty to EscapeRead the Press Release
On July 9, 2015, Kenneth D. Harris, Jr., 47, of Elkville, IL, pled guilty to a one-count indictment charging escape, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
Evidence at the plea hearing established that Harris is serving a 63 month sentence for conspiracy to manufacture methamphetamine. In December 2014, the Bureau of Prisons transferred Harris’ custody from Greenville-FCI to Centerstone Residential Reentry Center in Marion. On March 25, 2015, Harris failed to return to Centerstone after being on work-release. Harris did not return to Centerstone and was located and arrested by the United States Marshals Service in Elkville on April 1, 2015.
The offense carries a penalty of up to an additional 5 years of time in federal prison, to be followed by 3 years’ supervised release, and a fine of up to $250,000. Harris is currently being held without bond pending a November 3, 2015, sentencing hearing.
The investigation was conducted by the United States Marshals Service. The case is assigned to Assistant United States Attorney Amanda A. Robertson for prosecution.
Happy's Pizza Founder and Co-Conspirators Sentenced to Prison for Multi-Million Dollar Income and Employment Tax Fraud SchemeRead the Press Release
A Detroit-area businessman and other co-conspirators were sentenced to prison this week for income and employment tax fraud in the U.S. District Court for the Eastern District of Michigan, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division.
“Fraudulent business owners who underreport their income and employment taxes cheat not only the IRS and U.S. taxpayers, but also other businesses that comply with their tax obligations and seek to compete on a level playing field,” said Acting Assistant Attorney General Ciraolo. “Today’s sentencing of Happy Asker and the sentences imposed on his co-conspirators demonstrate that there is a heavy price for this conduct, and for obstructing and misleading IRS agents in the course of their investigation.”
Happy Asker, 38, of West Bloomfield, Michigan, was sentenced today to serve 50 months in prison, three years of supervised release and ordered to pay $2.5 million in restitution to the Internal Revenue Service (IRS) and a special assessment of $3,300 by U.S. District Court Chief Judge Denise Paige Hood. According to court documents and statements made during a 10-day jury trial in November 2014, Happy Asker was the president, founder and public face of the Happy’s Pizza franchise, a pizza chain based in Farmington Hills, Michigan, that operated restaurants throughout Michigan, Ohio and Illinois. Asker was convicted of three counts of filing false income tax returns for the years 2006 through 2008, 28 counts of aiding and assisting in the filing of false income and payroll tax returns for several of Happy’s Pizza franchise restaurants for the years 2006 through 2009, and corruptly endeavoring to obstruct and impede the administration of the Internal Revenue Code.
Asker’s co-conspirators and other individuals involved in the tax scheme, Maher Bashi, 47, Tom Yaldo, 42, and Tagrid Bashi, 47, all of West Bloomfield; and Arkan Summa, 42, of Walled Lake, Michigan, all pleaded guilty for their roles prior to Asker’s trial. On Oct. 23, 2014, Maher Bashi and Yaldo pleaded guilty to conspiracy to defraud the United States. On July 15, 2014, Summa pleaded guilty to obstruction of the IRS and Tagrid Bashi pleaded guilty to willfully delivering false documents to the IRS.
Maher Bashi, who served as Happy's Pizza's corporate chief operating officer, and Yaldo, an owner of numerous Happy's Pizza franchises, were also sentenced this week. On July 7, Bashi was sentenced to serve two years in prison, three years of supervised release and ordered to pay $620,297 in restitution to the IRS. Yaldo was sentenced to serve 18 months in prison, three years of supervised release and ordered to pay $314,078 in restitution to the IRS.
On April 1, Summa, an owner of numerous Happy’s Pizza franchises, was sentenced to serve 18 months in prison and ordered to pay $199,847 in restitution to the IRS. Tagrid Bashi, a nominee Happy’s Pizza franchise owner, was sentenced to three years of supervised probation.
“The license to run a business is not a license to avoid paying taxes,” said Chief Richard Weber of IRS-Criminal Investigation. “Mr. Asker and his co-defendants chose greed over legal business practices. As business owners, they had a responsibility to withhold income taxes for their employees and then remit those taxes to the Internal Revenue Service, as well as file timely individual and corporate tax returns. Time and again, our special agents untangle the web of financial transactions to bring to justice those that would try to cheat the government and the American taxpayer.”
Evidence at trial established that from 2004 through 2011, Asker, along with certain franchise owners and employees, executed a systematic and pervasive tax fraud scheme to defraud the IRS. Gross sales and payroll amounts were substantially underreported on numerous corporate income tax returns and payroll tax returns filed for nearly all 60 Happy’s Pizza franchise locations. From 2008 to 2010, Asker and his co-conspirators diverted for personal use more than $6.1 million in cash gross receipts from approximately 35 different Happy’s Pizza stores in the Detroit area, Illinois and Ohio. In total, Asker and certain employees and franchise owners failed to report approximately $3.84 million of gross income and approximately $2.39 million in payroll taxes from the various Happy’s Pizza franchises to the IRS. A portion of the unreported income was shared among most of the franchise owners, including Asker, in a weekly cash “profit split.” As a result of the scheme, the IRS is owed more than $6.2 million in income and employment taxes. The evidence also established that Asker intentionally misled IRS-Criminal Investigation special agents during voluntary interviews conducted with him in 2010.
Acting Assistant Attorney General Ciraolo commended special agents of IRS-Criminal Investigation, the Drug Enforcement Administration and the FBI, who investigated the case, and Senior Litigation Counsel Corey Smith and Trial Attorney Mark McDonald of the Tax Division, who prosecuted the case. Ciraolo also thanked the U.S. Attorney’s Office of the Eastern District of Michigan for their substantial assistance.
Gastonia Woman Pleads Guilty to Embezzling More Than $500,000 from EmployerRead the Press Release
CHARLOTTE, N.C. – A Gaston County woman appeared before U.S. Magistrate Judge David S. Cayer today and pleaded guilty to stealing more than $500,000 from her employer, announced Jill Westmoreland Rose, Acting U.S. Attorney for the Western District of North Carolina. Jennifer Ann Champagne, 39, of Gastonia, N.C. pleaded guilty making and possessing forged and counterfeit securities, wire fraud and access device fraud.
Acting U.S. Attorney Rose is joined in making today’s announcement by Felica R. Rude, Acting Special Agent in Charge of the U.S. Secret Service in Charlotte.
According to charging documents and today’s court proceedings, from 2006 to 2013, Champagne was employed by a Charlotte-based company specializing in the construction and repair of tennis courts and running tracks. Champagne was the company’s office manager and bookkeeper, and had access to the company’s safe, computer accounting programs, online bank accounts, security passwords and other confidential information. According to court records, Champagne did not have access to and was not authorized to sign company checks, or use the company’s bank accounts or credit card accounts outside of the normal course of business.
Court records show that Champagne exploited her position as office manager and embezzled money from her employer by signing the company’s President’s name on forged checks and then altered the company’s books and records to hide the theft. For example, according to court records, Champagne embezzled more than $260,000 by forging 100 company checks in her name and her husband’s landscaping business. Champagne also used the company’s credit card to make more than 400 unauthorized charges totaling over $40,000. Court records indicate that Champagne also made authorized bank transfers from the company’s bank accounts to her bank accounts, and issued a company credit in her name, which she used to make 170 unauthorized charges. Overall, court records show that Champagne’s scheme caused the company a loss of over $540,000.
Champagne was released on bond after her plea hearing. The making and possessing forged and counterfeit securities charge carries a maximum prison term of 10 years and a $250,000 fine. The wire fraud charge carries a maximum prison term of 20 years and a $250,000 fine. The access device fraud charge carries a maximum prison term of 15 years and a $250 fine. As part of her plea agreement, Champagne has agreed to pay restitution, the amount of which will be determined by the Court at sentencing. A sentencing date for the defendant has not been set yet.
The investigation was handled by the U.S. Secret Service. The prosecution for the government is being handled by Assistant U.S. Attorney Kenneth Smith of the U.S. Attorney’s Office in Charlotte.
Fourteen Plead Guilty in Mail Theft ConspiracyRead the Press Release
Contact Person: Bill Watkins (864) 282-2100
Columbia, South Carolina ---- United States Attorney Bill Nettles stated today that Wendy B. Sisk, age 44, Crystal D. Hudson, age 33, both of Honea Path, Jason Tomsha, age 46, of Greenville, Shannon D. Ashworth, age 33, Tonya M. Reid, age 38, John T. Eskew, age 28, Casey Hembree, age 20, Justin D. Powers, age 24, Whitney Strickland, age 27, Danny C. Buford, age 47, Ashley N. Burdette, age 29, James M. Day, age 44, Andrew C. Keaton, age 23, and Bonnie Reid, age 57, all of Anderson, pled guilty yesterday in federal court in Anderson, to conspiracy to steal United States mail, a violation of Title 18, United States Code, Section 371. United States District Timothy M. Cain, of Anderson accepted the pleas and will impose sentence after he has reviewed the presentence report which will be prepared by the U.S. Probation Office.
Evidence presented at the change of plea hearing established that the United States Postal Inspection Service, the Anderson County Sheriff’s Office, the Anderson City Police Department, and other local agencies had undertaken a long-term investigation into the theft of mail in and around Anderson County. It was discovered that an organization existed that regularly stole mail from residential boxes, sorted the stolen mail for checks and personal identifying information, created altered or counterfeit checks, and created false identification documents. Multiple counterfeit and altered checks were passed throughout the upstate. Law enforcement estimates that the losses from the activities of the conspiracy exceed $160,000. Most of the fraud was conducted in an effort to obtain funds to purchase methamphetamine. Since the arrest of the Defendants in April 2015, Postal Inspectors report that complaints of mail theft in Anderson County have markedly dropped.
Mr. Nettles stated the maximum penalty the Defendants can receive is a fine of $250,000 and/or imprisonment for 5 years, plus a special assessment of $100.
The case was investigated by agents of United States Postal Inspection Service, the Anderson County Sheriff’s Office, the Anderson City Police Department, and other local law enforcement agencies. Assistant United States Attorney Bill Watkins of the Greenville office handled the case.
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Founders of Film School for Wounded Veterans Found Guilty of Conspiracy, Fraud, and EmbezzlementRead the Press Release
SAN DIEGO – A federal jury returned guilty verdicts this afternoon against Judith Paixao and Kevin Lombard, a husband and wife who embezzled federal funds that were intended to provide job training, benefits and equipment for injured Marines returning from Iraq and Afghanistan.
Instead, the jury found, the couple used some of the funds to pay for a variety of personal expenses, including a vacation in Bermuda, cell phone bills for their family members, and the costs of a New Year’s Day sailing trip around San Diego Bay.
“Any fraud against our federal agencies is a serious matter,” said U.S. Attorney Laura Duffy. “But the fraud committed by these defendants -who used money set aside to help wounded veterans and spent it on themselves - is particularly offensive. These defendants capitalized on the misfortune of wounded marines in their time of vulnerability and took advantage of the VA’s commitment to serving wounded veterans to defraud the VA and enrich themselves.”
“Today, the jury’s guilty verdicts of Kevin Lombard and Judith Paixao send a clear message that fraud against our veterans will not be tolerated. These veterans endured many sacrifices to protect our country from harm. IRS-Criminal Investigation is committed to working with our partners to protect America’s veterans from tax evaders and fraudsters.”
From 2007-2009, Paixao and Lombard were directors of the Wounded Marine Careers Foundation (“the Foundation”), a tax-exempt entity that trained injured veterans for careers in the film industry. Evidence presented at trial showed that the defendants conspired to defraud the Department of Veterans Affairs (“VA”) and submitted false claims to the VA to get funds for training and equipment they never provided. In addition, the defendants were convicted on several felony counts related to embezzling funds from the Foundation. Finally, Defendant Paixao was convicted on one count of mail fraud for her role in a scheme to defraud another charity out of scholarship funds.
Evidence presented at trial showed that the defendants made numerous false and misleading statements to the VA in order to obtain funds for training and equipment, and then did not provide the training or equipment to the veterans. Although the defendants claimed to have donated over $200,000 to start the Foundation, they ended up taking over $400,000 from the Foundation’s accounts over the course of two years.
Rather than paying the Foundation’s creditors (some of whom were board members), the defendants transferred funds to their own personal credit cards and bank accounts. Although some of this money went to repay expenses they had fronted to the Foundation, the defendants ended up taking over $100,000 for themselves. The defendants then used these funds to pay for a variety of personal expenses, including a vacation in Bermuda, cell phone bills for their family members, and the costs of a New Year’s Day sailing trip around San Diego Bay.
The defendants routinely commingled the finances of the Foundation with their personal finances, thereby obstructing the ability of the Internal Revenue Service to monitor the Foundation’s tax-exempt status and determine the defendants’ personal income tax liability.
Among the witnesses who testified at trial were three of the injured veterans who used their vocational rehabilitation benefits to participate in the first training class: Gunnery Sergeant Nick Popaditch and Lance Corporal Joshua Frey. Lance Corporal Frey, who had previously been quoted in a favorable New York Times article, testified at trial that after the article was published the defendants did not give him all the equipment he was promised, and failed to provide him with certain training and job placement.
Evidence at trial also showed that Defendant Paixao defrauded the Bob Woodruff Foundation in connection with a restricted grant of almost $100,000 by concealing the fact that one of the intended recipients – a Marine who had been injured in Fallujah – had left the program. Instead of notifying the Bob Woodruff Foundation and asking for a reallocation of the funds, Ms. Paixao took the grant money and used it for other purposes.
Both defendants remain on bond and were ordered to return to court on October 19, 2015 for a sentencing hearing.
DEFENDANTS Case Number: 13cr3788-JM Judith Ann Paixao Age: 61 Brunswick, Georgia Kevin Lombard Age: 64 Brunswick, Georgia CHARGESCount 1: Conspiracy to defraud the United States and commit the offenses (18 U.S.C. § 371).
Guilty as to both defendantsCounts 2-9: Theft from an organization receiving federal funds (18 U.S.C. § 666(a)(1)).
Defendant Paixao: Guilty as to all counts
Defendant Lombard: Guilty on counts 2-4, 6-10; not guilty on count 5.Counts 10-12: False claims (18 U.S.C. § 287)
Guilty as to all counts for both defendantsCount 13: Mail fraud (18 U.S.C. § 1341)
INVESTIGATING AGENCIES
Defendant Paixao: Guilty
Defendant Lombard: Not GuiltyDepartment of Veterans Affairs, Office of Inspector General
Internal Revenue Service, Criminal InvestigationFormer Rochester Tax Preparer Pleads Guilty to Preparing False ReturnsRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
ROCHESTER, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that Jason R. Pastore, 34, formerly of Rochester, NY, pleaded guilty to preparing false tax returns, before U.S. District Judge Elizabeth A. Wolford. The charge carries a maximum penalty of three years in prison and a $250,000 fine.Assistant U.S. Attorney Richard A. Resnick, who is handling the case, stated the defendant operated a tax return business known as JRP Tax Consultants in Rochester. Pastore, without the knowledge of clients, prepared fraudulent federal income tax returns. Specifically, the defendant reported false charitable contributions and un-reimbursed employee expenses on Schedule A, and false business deductions on Schedule C. As a result, clients received tax refunds to which they were not entitled.
For the tax years, 2008, 2009, and 2010, Pastore prepared approximately 234 fraudulent returns which resulted in the Internal Revenue Service paying more than $400,000 in tax refunds to which the clients were not entitled. The defendant also prepared and filed fraudulent tax returns for himself during the same time period.
The plea is the result of an investigation by Special Agents of the Internal Revenue Service, Criminal Investigation Division, under the direction of Shantelle P. Kitchen, Special Agent in Charge, New York Field Office.
Sentencing is scheduled for November 9, 2015, at 10:30 a.m. before Judge Wolford.