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1 July 2015
Louisiana Motel Owner Pleads Guilty in Sex Trafficking CaseRead the Press Release
WASHINGTON – Today, a motel owner pleaded guilty to financially benefiting from a sex trafficking scheme operated out of the Riviera Motel in New Orleans in which multiple adult women were compelled to engage in prostitution, announced head of the Civil Rights Division Principal Deputy Assistant Attorney General Vanita Gupta and U.S. Attorney Kenneth Allen Polite Jr. of the Eastern District of Louisiana. Kanubhai Patel, also known as Mr. Kenny and Pop, 74, of Kenner, Louisiana, pleaded guilty to one count of benefitting financially from trafficking in persons.
“The Department of Justice will not tolerate those who traffic in human beings or who benefit financially from human trafficking,” said Principal Deputy Assistant Attorney General Gupta. “We will continue in our steadfast determination to bring to justice not only those who use force and coercion to exploit other human beings—but also those entities or individuals who knowingly profit from these depraved acts.”
“This defendant callously profited from a sex trafficking venture that used force, fraud and coercion to compel women to engage in commercial sex acts,” said U.S. Attorney Polite. “These crimes often pass without detection because victims live in fear from physical abuse, threats and other forms of coercion. My office is committed to prosecuting individuals and organizations that profit from this illegal conduct.”
“This investigation and prosecution should serve as a clear reminder to all those individuals engaged in sex trafficking and those who profit from this heinous crime, that the full force of federal law enforcement, across geographical boundaries, will bring them to swift justice,” said Special Agent in Charge Michael Anderson of the FBI’s New Orleans Office.
“Human trafficking is a form of modern-day slavery that Homeland Security Investigations fights as one of its highest priorities via a coordinated global effort with the FBI and our state and local law enforcement partners,” said Acting Special Agent in Charge Cindy M. Johnson of Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI) New Orleans. “The results speak for themselves; over the past two years HSI has doubled its number of human trafficking arrests. HSI will continue to investigate and seek prosecution of these criminals while also ensuring the victims of this terrible crime are rescued and get the care they need.”
According to evidence presented in court and documents filed in connection with the case, Patel acknowledged that, in his role as the former owner of the Riviera Motel, he regularly rented rooms to individuals who are charged as sex trafficking co-conspirators in connection with this case, knowing they were pimps who forced and coerced women to engage in prostitution. Patel admitted that although he never personally recruited, groomed or coerced any of the victims, he benefited financially from the sex trafficking operation.
Evidence presented at the plea hearing and court documents establish that Patel would charge the pimps and sex trafficking co-conspirators higher rates than other motel guests, and would open the motel’s gate to allow the women to bring customers back to the hotel. Patel learned that members of the sex trafficking conspiracy physically assaulted women they prostituted, including one instance in which a co-conspirator brutally beat one woman with a large piece of wood while she screamed for help, leaving her with multiple lacerations and what appeared to be a broken arm. Patel also saw the damage that a co-conspirator caused to a motel room during a beating, including a broken toilet, a damaged sink and blood on the walls. Patel agreed not to call the police after the co-conspirator paid him for the damage to the room. Patel also knew that, in furtherance of the sex trafficking scheme, members of the sex trafficking conspiracy would take the women’s identification cards from them. Patel saw the sex trafficking co-conspirators possessing the women’s identification cards and using them to rent hotels. Patel did not report them to police as long as they paid their rent.
At sentencing, Patel faces a statutory maximum sentence of five years in prison for benefiting financially from participating in a trafficking scheme involving control of victims’ identification documents.
Five other defendants have pleaded guilty in connection with the case. On June 25, 2014, Zacchaeus Taylor, 22, pleaded guilty to sex trafficking conspiracy and to transportation for purposes of prostitution. Laquentin Brown, 33, and Anthony Ellis, 26, subsequently pleaded guilty to the same charges on March 4, 2015, and April 20, 2015, respectively. All of these defendants are from Memphis, Tennessee, and each faces a statutory maximum sentence of five years in prison for conspiracy and a statutory maximum sentence of 10 years in prison for transportation for prostitution.
On April 20, 2015, Duane Phillips, 29, and Christopher Williams, 30, also of Memphis, each pleaded guilty to sex trafficking conspiracy. They each face a statutory maximum sentence of life in prison.
Patel was charged in a second superseding indictment returned on Oct. 3, 2014, along with Brown, Ellis, Philips, Williams and Granville Robinson, 26, also of Memphis. Taylor was charged separately on March 28, 2014. Of the seven defendants charged in connection with the case, six have entered guilty pleas and Robinson is awaiting trial. An indictment is merely an accusation and the defendants are innocent until proven guilty.
This case was investigated jointly by agents from the New Orleans Field Offices of the FBI and Department of Homeland Security, with assistance from the FBI’s Memphis Field Office. This case is being prosecuted by Special Litigation Counsel John Cotton Richmond and Trial Attorney Christine M. Siscaretti of the Civil Right Division’s Human Trafficking Prosecution Unit, and Assistant U.S. Attorney Julia K. Evans of the Eastern District of Louisiana.
Kanubhai Patel Factual Basis (36.06 KB)
Louisiana Motel Owner Pleads Guilty in Sex Trafficking CaseRead the Press Release
Sex Trafficking Scheme Used Threats, Violence and Coercion to Compel Women into Prostitution in New Orleans and Elsewhere
Today, a motel owner pleaded guilty to financially benefiting from a sex trafficking scheme operated out of the Riviera Motel in New Orleans in which multiple adult women were compelled to engage in prostitution, announced head of the Civil Rights Division Principal Deputy Assistant Attorney General Vanita Gupta and U.S. Attorney Kenneth Allen Polite Jr. of the Eastern District of Louisiana. Kanubhai Patel, also known as Mr. Kenny and Pop, 74, of Kenner, Louisiana, pleaded guilty to one count of benefitting financially from trafficking in persons.
“The Department of Justice will not tolerate those who traffic in human beings or who benefit financially from human trafficking,” said Principal Deputy Assistant Attorney General Gupta. “We will continue in our steadfast determination to bring to justice not only those who use force and coercion to exploit other human beings—but also those entities or individuals who knowingly profit from these depraved acts.”
“This defendant callously profited from a sex trafficking venture that used force, fraud and coercion to compel women to engage in commercial sex acts,” said U.S. Attorney Polite. “These crimes often pass without detection because victims live in fear from physical abuse, threats and other forms of coercion. My office is committed to prosecuting individuals and organizations that profit from this illegal conduct.”
“This investigation and prosecution should serve as a clear reminder to all those individuals engaged in sex trafficking and those who profit from this heinous crime, that the full force of federal law enforcement, across geographical boundaries, will bring them to swift justice,” said Special Agent in Charge Michael Anderson of the FBI’s New Orleans Office.
“Human trafficking is a form of modern-day slavery that Homeland Security Investigations fights as one of its highest priorities via a coordinated global effort with the FBI and our state and local law enforcement partners,” said Acting Special Agent in Charge Cindy M. Johnson of Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI) New Orleans. “The results speak for themselves; over the past two years HSI has doubled its number of human trafficking arrests. HSI will continue to investigate and seek prosecution of these criminals while also ensuring the victims of this terrible crime are rescued and get the care they need.”
According to evidence presented in court and documents filed in connection with the case, Patel acknowledged that, in his role as the former owner of the Riviera Motel, he regularly rented rooms to individuals who are charged as sex trafficking co-conspirators in connection with this case, knowing they were pimps who forced and coerced women to engage in prostitution. Patel admitted that although he never personally recruited, groomed or coerced any of the victims, he benefited financially from the sex trafficking operation.
Evidence presented at the plea hearing and court documents establish that Patel would charge the pimps and sex trafficking co-conspirators higher rates than other motel guests, and would open the motel’s gate to allow the women to bring customers back to the hotel. Patel learned that members of the sex trafficking conspiracy physically assaulted women they prostituted, including one instance in which a co-conspirator brutally beat one woman with a large piece of wood while she screamed for help, leaving her with multiple lacerations and what appeared to be a broken arm. Patel also saw the damage that a co-conspirator caused to a motel room during a beating, including a broken toilet, a damaged sink and blood on the walls. Patel agreed not to call the police after the co-conspirator paid him for the damage to the room. Patel also knew that, in furtherance of the sex trafficking scheme, members of the sex trafficking conspiracy would take the women’s identification cards from them. Patel saw the sex trafficking co-conspirators possessing the women’s identification cards and using them to rent hotels. Patel did not report them to police as long as they paid their rent.
At sentencing, Patel faces a statutory maximum sentence of five years in prison for benefiting financially from participating in a trafficking scheme involving control of victims’ identification documents.
Five other defendants have pleaded guilty in connection with the case. On June 25, 2014, Zacchaeus Taylor, 22, pleaded guilty to sex trafficking conspiracy and to transportation for purposes of prostitution. Laquentin Brown, 33, and Anthony Ellis, 26, subsequently pleaded guilty to the same charges on March 4, 2015, and April 20, 2015, respectively. All of these defendants are from Memphis, Tennessee, and each faces a statutory maximum sentence of five years in prison for conspiracy and a statutory maximum sentence of 10 years in prison for transportation for prostitution.
On April 20, 2015, Duane Phillips, 29, and Christopher Williams, 30, also of Memphis, each pleaded guilty to sex trafficking conspiracy. They each face a statutory maximum sentence of life in prison.
Patel was charged in a second superseding indictment returned on Oct. 3, 2014, along with Brown, Ellis, Philips, Williams and Granville Robinson, 26, also of Memphis. Taylor was charged separately on March 28, 2014. Of the seven defendants charged in connection with the case, six have entered guilty pleas and Robinson is awaiting trial. An indictment is merely an accusation and the defendants are innocent until proven guilty.
This case was investigated jointly by agents from the New Orleans Field Offices of the FBI and Department of Homeland Security, with assistance from the FBI’s Memphis Field Office. This case is being prosecuted by Special Litigation Counsel John Cotton Richmond and Trial Attorney Christine M. Siscaretti of the Civil Right Division’s Human Trafficking Prosecution Unit, and Assistant U.S. Attorney Julia K. Evans of the Eastern District of Louisiana.
KC Man Sentenced for Possessing Thousands of Images of Child PornRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Kansas City, Mo., man was sentenced in federal court today for having thousands of images of child pornography on his computer.
Duane E. Elliott, 57, of Kansas City, was sentenced by U.S. District Judge Dean Whipple to seven years in federal prison without parole. Elliott has also paid $3,000 in restitution to one of the victims whose images of child sexual abuse were included in his collection of child pornography.
On Oct. 28, 2014, Elliott pleaded guilty to two counts of receiving child pornography over the Internet.
A detective with the Independence, Mo., Police Department identified Elliott’s computer as sharing child pornography over the Internet. Elliott used a peer-to-peer file-sharing program to make approximately 20 movies of child pornography available for distribution over the Internet on multiple occasions.
Law enforcement officers executed a search warrant at Elliott’s residence and seized multiple computers and electronic storage media, which contained thousands of images of child pornography. Investigators found more than 1,000 movies and more than 2,500 images of child pornography. Some of the movies depicted sexually explicit conduct with children under the age of 12, and some depicted children in bondage or subjected to other sadistic or violent sexual abuse. Among the videos were two instructional videos, one titled, “How to Molest Juveniles.”
According to court documents, Elliott had more child pornography stored on an encrypted hard drive that could not be examined.
This case was prosecuted by Assistant U.S. Attorney Teresa Moore. It was investigated by the Independence, Mo., Police Department and the FBI Cyber Crimes Task Force.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
KC Man Sentenced for Child PornRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Kansas City, Mo., man was sentenced in federal court today for possessing child pornography and attempting to distribute child pornography over the Internet.
Craig E. Williams, Jr., 28, of Kansas City, was sentenced by U.S. District Judge Gary A. Fenner to seven years in federal prison without parole. Williams must also pay restitution of $5,000 apiece to two of the victims, or $3,000 apiece if he pays within 30 days of the sentencing date.
On Dec. 2, 2014, Williams pleaded guilty to for possessing child pornography and attempting to distribute child pornography over the Internet.
Kansas City, Mo., police officers arrested Williams at his residence on May 16, 2013, on a felony warrant for an unrelated state case. They seized various electronic media from his residence. Forensic investigators discovered 413 videos of child pornography and more than 200 images of child pornography on a computer and three hard drives. The victims were primarily prepubescent children, including some toddlers. Some of the images depicted bestiality and child bondage.
Williams told officers that he used a peer-to-peer file-sharing program to download child pornography over the Internet. According to court documents, by the time Williams was caught he had been viewing and sharing child pornography for five years.
Williams was also being investigated by the Nixa, Mo., Police Department and the Western Missouri Cyber Crime Task Force, which were conducting separate undercover child pornography investigations and had identified Williams’s computer as sharing child pornography over the Internet. Investigators downloaded child pornography being made available by Williams on five separate occasions.
This case was prosecuted by Assistant U.S. Attorney Catherine A. Connelly. It was investigated by the Kansas City, Mo., Police Department, the FBI, the Nixa, Mo., Police Department and the Western Missouri Cyber Crime Task Force.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Justice Department Files Antitrust Lawsuit to Stop Electrolux from Buying General Electric's Appliance BusinessRead the Press Release
The Department of Justice filed a civil antitrust lawsuit today seeking to block the acquisition of General Electric Company’s appliance business by AB Electrolux and Electrolux North America Inc., whose brands include Frigidaire. The department said that the $3.3 billion acquisition would combine two of the leading manufacturers of ranges, cooktops and wall ovens sold in the United States, eliminating competition that has benefited American consumers through lower prices and more options. According to the department’s complaint, purchasers in the United States spent over $4 billion on these major cooking appliances in 2014.
“Electrolux’s proposed acquisition of General Electric’s appliance business would leave millions of Americans vulnerable to price increases for ranges, cooktops and wall ovens, products that serve an important role in family life and represent large purchases for many households,” said Deputy Assistant Attorney General Leslie C. Overton of the Justice Department’s Antitrust Division. “This lawsuit also seeks to prevent a duopoly in the sale of these major cooking appliances to builders and other commercial purchasers, who often pass on price increases to home buyers or renters.”
The Antitrust Division’s lawsuit, which seeks to prevent the companies from merging and to preserve their existing head-to-head competition, was filed in the U.S. District Court for the District of Columbia.
Electrolux North America Inc. is an Ohio corporation headquartered in Charlotte, North Carolina. Electrolux North America Inc. makes and sells major appliances, including those under the brand names Frigidaire, Tappan and Electrolux. Electrolux’s annual major-appliance sales in the United States total approximately $2.6 billion. Electrolux North America Inc. is a wholly owned subsidiary of defendant AB Electrolux.
General Electric Company is a New York corporation headquartered in Fairfield, Connecticut. General Electric’s appliance business is based in Louisville, Kentucky. It makes and sells major appliances, including those under the brand names GE Monogram, GE Café, GE Profile, GE, GE Artistry and Hotpoint. In the United States, General Electric’s annual major appliance sales total approximately $3.4 billion.
Jury Finds Bakersfield Man Guilty of Laser Strikes on Kern County Sheriff’s HelicopterRead the Press Release
FRESNO, Calif. — After a two-day trial, Barry Lee Bowser Jr., 52, of Bakersfield, was found guilty today of one count of aiming the beam of a laser pointer at an aircraft, United States Attorney Benjamin B. Wagner announced.
According to court documents, on September 12, 2014, Bowser aimed the beam of a green laser at Air-1, a Kern County Sheriff’s helicopter while it was providing support to ground units responding to a man armed with a gun. The helicopter was struck two times by a powerful green laser from a distance of about 1/8 mile. The beam of the laser appeared to track the helicopter, which was flying at about 400 to 500 feet above the ground. The helicopter’s mission was diverted near the approach to Meadows Field Airport because of the laser strike. The pilot experienced flash blindness and eye discomfort and pain that lasted several hours.
According to evidence presented at trial, the officers pinpointed the source of the laser to a commercial property and motorhome surrounded by a chain link fence on Sillect Avenue in Bakersfield. Bowser, who was residing in the motorhome, admitted to the officers that he had just placed new batteries in the laser and was testing its capabilities.
This case is the product of an investigation by the FBI, Kern County Sheriff’s Office, and the Bakersfield Police Department. Assistant U.S. Attorney Karen A. Escobar and Special Assistant U.S. Attorney Bayleigh Pettigrew are prosecuting the case.
Bowser is scheduled to be sentence by United States District Judge Lawrence J. O’Neil on September 28, 2015. Bowser faces a maximum penalty of five years in prison and a $250,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
Reports of laser attacks have increased dramatically in recent years as powerful laser devices have become more affordable and widely available to the public. In 2014, the Federal Aviation Administration (FAA) received 3,894 reports of incidents involving laser strikes on aircraft. In the Eastern District of California, which encompasses 34 counties in the eastern portion of California, there were 150 reported laser incidents, with Bakersfield and Fresno leading in the number of reported incidents. Lasers can completely incapacitate pilots who are trying to fly safely to their destination, endangering their crew members, passengers and people on the ground.
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Jicarilla Apache Man Pleads Guilty to Federal Child Sexual Abuse ChargeRead the Press Release
ALBUQUERQUE – Raylon Castillo, 19, an enrolled member of the Jicarilla Apache Nation who resides in Dulce, N.M., pled guilty this afternoon in federal court in Las Cruces, N.M., to an indictment charging him with sexual abuse of a child.
Castillo was arrested on Dec. 18, 2014, on a criminal complaint alleging that he raped the victim, a Native American female, who was at least 12 years old but not yet 16 years of age, on July 25, 2014, on the Mescalero Apache Indian Reservation in Otero County, N.M. The complaint alleged that Castillo forced the victim to have sexual intercourse with him. Castillo was arrested on tribal charges on July 25, 2014, and remained in tribal custody until his arrest on the federal complaint.
Castillo was indicted on May 20, 2015, and charged with sexual abuse of a child who was between the ages of 12 and 16 on July 25, 2014, in Otero County. During today’s proceedings, Castillo pled guilty to the indictment.
At sentencing, Castillo faces a statutory maximum penalty of 15 years in prison followed by up to three years of supervised release. Castillo will be required to register as a sex offender after completing his term of incarceration. He remains in custody pending a sentencing hearing which has yet to be scheduled.
This case was investigated by the Las Cruces office of the FBI and the Mescalero Agency of the BIA’s Office of Justice Services. The case is being prosecuted by Assistant U.S. Attorney Aaron O. Jordan of the U.S. Attorney’s Las Cruces Branch Office 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/.
Inver Grove Heights Man Sentenced to 37 Months in Prison for Conspiring to Traffic Counterfeit JerseysRead the Press Release
United States Attorney Andrew M. Luger today announced the sentence of BRIAN TODD GORE a/k/a “Sammy Walker,” 46, to 37 months in federal prison for conspiring to traffic counterfeit Major League Baseball, National Basketball Association, National Football League, National Hockey League and National Collegiate Athletic Association jerseys. GORE was indicted on July 9, 2014, and pleaded guilty on December 9, 2014. He was sentenced today before United States District Court Judge Patrick Schiltz.
According to the defendant’s guilty plea and documents filed in court, from November 2009 through September 2012, GORE ordered counterfeit jerseys from suppliers in China and sold them to various buyers in Minnesota and elsewhere. One such buyer was a co-conspirator, R.M., the owner of AME Sports in Roseville, Minnesota. According to R.M., Gore was R.M.’s primary supplier of counterfeit jerseys, which R.M. sold at his store.
According to the defendant’s guilty plea and documents filed in court, in February 2010, GORE and others from Minnesota traveled to Miami, Fla., to sell fake NFL jerseys at Super Bowl XLIV. They were encountered as part of a law enforcement operation in which GORE and his co-conspirators tried to sell the counterfeit apparel to undercover officers. At the time, officers seized 383 jerseys from GORE, as well as international shipping receipts showing packages sent from China.
GORE was caught again two years later in Minnesota while in possession of more than 2,000 counterfeit jerseys and hats, some of which retailed in authentic form for as much as $300 each. The total potential retail value of the goods GORE counterfeited was at least $320,000.
This case is the result of an investigation conducted by Homeland Security Investigations.
This case was prosecuted by Assistant U.S. Attorney Sarah E. Hudleston.
Defendant Information:
BRIAN TODD GORE, 46
Inver Grove Heights, Minn.
Convicted:
- Conspiracy to traffic in counterfeit goods, 1 count
Sentenced:
- 37 months in prison
- 3 years supervised release
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Honduran National Sentenced for Illegal Re-EntryRead the Press Release
U.S. Attorney Kenneth A. Polite announced that TONY AXELL ROMERO-MONTOYA, age 28, a citizen of Honduras, was sentenced today after previously pleading guilty to a one-count Indictment charging him with illegal reentry of a removed alien.
U.S. District Judge Sarah R. Vance sentenced ROMERO-MONTOYA to time served, followed by one year of supervised release. ROMERO-MONTOYA will be surrendered to the custody of the U.S. Immigration & Customs Enforcement for removal proceedings.
According to the court documents, on February 25, 2015, ROMERO-MONTOYA was found in the United States after having been deported previously on September 17, 2012.
U.S. Attorney Polite praised the work of the Department of Homeland Security in investigating this matter. The case was prosecuted by Assistant United States Attorney Emily K. Greenfield.
Homestead Man Charged with Two Counts of Sex Trafficking of A ChildRead the Press Release
PITTSBURGH - An Allegheny County resident has been indicted by a federal grand jury in Pittsburgh on charges of sex trafficking of a child, United States Attorney David J. Hickton announced today.
The two-count indictment, returned on June 25, and sealed today, named Mario Grisom, 34, of Homestead, Pa., as the sole defendant.
According to the indictment, in and around April 2015, Grisom knowingly recruited, enticed, harbored, transported, provided and obtained a female minor, Minor A, to engage in commercial sex acts. The indictment further charges that from in and around July 2012, to in and around August 2012, Grisom knowingly attempted to recruit, entice, harbor, transport, provide and obtain a female minor, Minor B, to engage in commercial sex acts.
The law provides for a maximum total sentence of life imprisonment, a fine of $500,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Jessica Lieber Smolar is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation and the City of Pittsburgh Bureau of Police conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Hartford Man Sentenced to 5 Years in Federal Prison for Role in Crack Cocaine Distribution RingRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that MORRIS CARTER, JR., also known as “Chilly Mo” and “Mo,” 46, of Hartford, was sentenced today by U.S. District Judge Alvin W. Thompson in Hartford to 60 months of imprisonment, followed by seven years of supervised release, for distributing crack cocaine.
This matter stems from “Operation Vinefield,” a joint law enforcement investigation headed by the FBI’s Northern Connecticut Violent Crimes Task Force targeting narcotics trafficking and gang violence in Hartford’s North End. As a result of the nine-month investigation, 38 individuals were charged with various offenses related to the distribution of crack cocaine and the unlawful possession and dealing of firearms in and around Hartford.
According to court documents and statements made in court, the investigation revealed that Joshua Easterling, also known as “Skeet,” “Squash” and “SQ,” controlled the distribution of crack cocaine in Hartford’s lower Vine Street area. Easterling distributed crack to other street-level dealers, and also sold the drug directly to customers. In addition, Easterling utilized individuals, including CARTER, as “pagers” or “runners” who would bring customers to Easterling, deliver small quantities of narcotics and provide information on police activity.
CARTER’s criminal history includes multiple several felony convictions, including a conviction for manslaughter in the first degree in 1990.
CARTER has been detained since his arrest on January 9, 2012. On February 28, 2013, a jury found him guilty of one count of conspiracy to possess with intent to distribute 28 grams or more of cocaine base (“crack cocaine”), and one count of use of a telephone to facilitate a narcotics trafficking felony.
Easterling pleaded guilty and, on May 18, 2015, was sentenced to 120 months of imprisonment.
This matter was investigated by the FBI’s Northern Connecticut Violent Crimes Task Force, the Connecticut State Police, the Hartford Police Department, and the Connecticut Department of Correction. The case was prosecuted by Assistant U.S. Attorney Brian P. Leaming.
Georgia Man Sentenced for Fraudulently Obtaining Title Ii Child Insurance BenefitsRead 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 Donald Hargrave, 62, of Douglasville, GA, who was convicted of unlawfully receiving Title II Child Insurance Benefits, was sentenced to two years probation by Senior U.S. District Judge William M. Skretny. The defendant was also ordered to pay $39,124 in restitution.Assistant U.S. Attorney Scott S. Allen, Jr., who handled the case, stated that between May 2012 and July 2013, while living in Buffalo, the defendant received Title II Child Insurance Benefits from the Social Security Administration but did not use the benefits to support his son. Hargrave received a total of $39,124 to which he was not entitled.
The sentencing is the result of an investigation by the Office of the Inspector General of the Social Security Administration, under the direction of Special Agent in Charge Edward J. Ryan.
Four Steroid Distributors SentencedRead the Press Release
ATLANTA – Four steroid distributors have been sentenced for trafficking in illegal anabolic steroids. The defendants were importing raw materials from China and selling the finished product online.
"The use of illegal anabolic steroids is far from a harmless pursuit. They pose significant health risks,” said Acting U.S. Attorney John Horn. “Users of steroids could suffer kidney failure, liver damage, and younger users can even suffer heart attacks. Thankfully, USPIS and DEA agents put these distributors, who sent their illicit product across the country, out of business.”
“The sentencing’s for the suspects involved in Operation Eliteanabolx should serve as a warning to those who intend to misuse the U.S. Mail for shipping illicit drugs. The U.S. Postal Inspection Service would like to recognize and commend the efforts of our state and local counterparts who diligently investigated this case as well as the U.S. Attorney's Office of the Northern District of Georgia for their dedication and assistance in a successful resolution. The U.S. Postal Inspection Service remains vigilant in protecting the nation's mail system from all criminal activity to ensure the public's trust in a safe and secure mail system,” said Thomas L. Noyes II, Inspector in Charge, Charlotte Division.
“Steroids pose a significant health risk to users seeking to artificially enhance their athletic abilities,” said Daniel R. Salter, the Special Agent in Charge of the DEA Atlanta Field Division commented on the sentencings. “The mission of DEA is unwavering--we relentlessly pursue drug traffickers who distribute dangerous drugs that cause immeasurable damage to our communities.”
According to Acting U.S. Attorney Horn, the charges and other information presented in court: In 2013, Brandon Keith Franklin and Jay Michael Reger began producing and selling anabolic steroids under the name Performance Formulations. They received raw materials for the steroids from China and sold the finished product online. Franklin and Reger were partners in the operation: Franklin managed the website and Reger mixed the raw materials to create the finished product. They hired Austin Britt Shirley and Andrew Chrismer to fill the orders. Shirley packed the orders and Chrismer mailed them. Franklin used the proceeds from his illegal steroid business to fund a lavish lifestyle, purchasing a number of luxury vehicles.
Shirley and Chrismer were arrested on May 28, 2014, when law enforcement agents with the United States Postal Inspection Service and the Drug Enforcement Administration seized tens of thousands of units of steroids from the organization. Franklin was arrested on December 3, 2014. Even after the seizures and arrests, Reger continued to manufacture steroids from his home in Woodstock, Georgia, until he was arrested on December 10, 2014.
The defendants in this case have been sentenced as follows:
- Brandon Keith Franklin, 41, of Canton, Georgia, was sentenced to two years, six months in prison to be followed by three years of supervised release. Franklin was convicted on December 16, 2014, after he pleaded guilty. His luxury vehicles were also forfeited.
- Jay Michael Reger, 30, of Woodstock, Georgia, was sentenced to two years in prison to be followed by three years of supervised release. Reger was convicted on December 16, 2014, after he pleaded guilty.
- Andrew Chrismer, 25, of Atlanta, Georgia, was sentenced to one year in prison to be followed by two years of supervised release. Chrismer was convicted on June 25, 2014, after he pleaded guilty.
- Austin Britt Shirley, 25, of Acworth, Georgia, was sentenced to two years of probation. Shirley was convicted on September 25, 2014 after he pleaded guilty.
All four defendants were all sentenced by U.S. District Judge Timothy C. Batten, Sr.
This case was investigated by the United States Postal Inspection Service and Drug Enforcement Administration.
Assistant United States Attorney Vivek Kothari prosecuted the case.
The U.S. Attorney’s Office in Atlanta recommends parents and children learn about the dangers of drugs at the following web site: www.justthinktwice.com.
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 Atlanta Division is http://www.justice.gov/usao-ndga.
Four Individuals Charged for Importing and Trafficking Counterfeit Apple and Sony Technology into the United StatesRead the Press Release
Four individuals were arraigned today in Newark, New Jersey, based on charges for allegedly smuggling counterfeit Sony Camcorders, Apple iPhones, iPads and iPods, from China for sale in the United States, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Paul Fishman of the District of New Jersey, Acting Special Agent in Charge Kevin Kelly of U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI) in Newark and Bergen County Prosecutor John Molinelli.
Andreina Becerra, 30, a Venezuelan national, and Roberto Volpe, 33, an Italian national, both residing in Miami; Jianhua Li, 40, a Chinese national and resident of Guangzhou, China; and Rosario La Marca, 52, an Italian national and resident of Italy, are charged in an eight-count indictment with importing and trafficking fake iPhones, iPads and iPods bearing counterfeit Apple trademarks and fake Camcorders bearing counterfeit Sony trademarks, as well as smuggling, structuring and international money laundering.
The defendants were arrested last week in a coordinated multi-district effort by HSI in Los Angeles, Miami and Newark. The defendants were arraigned this afternoon before U.S. District Judge Kevin McNulty of the District of New Jersey.
According to the allegations in the indictment, from July 2009 through February 2014, the defendants conspired to smuggle into the United States from China over 40,000 electronic devices and accessories, including fake iPads, iPhones and iPods, along with labels and packaging, most bearing counterfeit Apple trademarks. The indictment alleges that the estimated manufacturers’ suggested retail prices for an equivalent number of genuine items would have exceeded $15 million.
The indictment alleges that, to avoid detection by U.S. Customs officials, the devices often were shipped separately from the labels bearing counterfeit trademarks, and then were labeled and packaged after they passed through U.S. Customs and Border Protection. According to the indictment, the defendants then re-shipped the devices throughout the United States to co-conspirators. According to the indictment, proceeds from the sales of the devices were funneled back to the defendants’ accounts in Florida and New Jersey via structured cash deposits – broken into multiple deposits of less than $10,000 each to avoid bank reporting requirements. The indictment further alleges that a portion of the proceeds was then transferred to co-conspirators in Italy, further disguising the source of the funds. According to the indictment, the defendants made more than 100 illegal wire transfers totaling over $1.1 million to Li’s Hong Kong accounts to facilitate their criminal activity.
The charges and allegations contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
This case was investigated by the HSI Newark Seaport Investigations Group and the Bergen County Prosecutor’s Office White Collar Crimes Squad, with significant assistance from Europol and Italian law enforcement authorities. The case is being prosecuted by Senior Counsel Evan Williams and Rudy Orjales of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorneys Leslie Schwartz and Sarah Devlin of the District of New Jersey.
The enforcement action announced today is one of many efforts being undertaken by the Department of Justice Task Force on Intellectual Property (IP Task Force). The IP Task Force supports prosecution priorities, promotes innovation through heightened civil enforcement, enhances coordination among federal, state, and local law enforcement partners, and focuses on international enforcement efforts, including reinforcing relationships with key foreign partners and U.S. industry leaders. To learn more about the IP Task Force, go to www.justice.gov/dag/iptaskforce/.
Becerra et al Indictment
Four Individuals Charged for Importing and Trafficking Counterfeit Apple and Sony Technology into the United StatesRead the Press Release
NEWARK, N.J. – Four people were charged today for allegedly smuggling counterfeit Apple iPhones, iPads and iPods, and Sony camcorders, from China for sale in the United States, U.S. Attorney Paul Fishman of the District of New Jersey, Assistant Attorney General Leslie Caldwell of the Justice Department’s Criminal Division, Special Agent in Charge Kevin Kelly of Homeland Security Investigations (HSI) in Newark and Bergen County Prosecutor John Molinelli announced.
The eight-count indictment charges Andreina Becerra, 30, a Venezuelan national, and Roberto Volpe, 33, an Italian national, both of Miami; Jianhua Li, 40, a Chinese national and resident of Guangzhou, China; and Rosario La Marca, 52, an Italian national and resident of Naples, Italy, with importing and trafficking fake iPhones, iPads and iPods bearing counterfeit Apple trademarks, and fake camcorders bearing counterfeit Sony trademarks, as well as smuggling, structuring and international money laundering.
The defendants were arrested last week in a coordinated, multi-district effort by HSI in Los Angeles, Miami and Newark. The defendants were arraigned this afternoon before U.S. District Court Judge Kevin McNulty Newark federal court.
According to the indictment:
From July 2009 through February 2014 the defendants allegedly conspired to smuggle into the United States from China more than 40,000 electronic devices and accessories. The estimated manufacturer’s suggested retail prices for an equivalent number of genuine items would have exceeded $15 million. The devices were often shipped separately from the labels bearing counterfeit trademarks in order avoid detection by Customs and Border Protection. The devices were then labeled and packaged after they passed through customs.
The defendants then allegedly re-shipped the devices to conspirators all over the United States. Proceeds from the sales of the devices were funneled back to the defendants’ accounts in Florida and New Jersey via structured cash deposits – broken into multiple deposits of less than $10,000 each to avoid bank reporting requirements – and a portion of the proceeds was then transferred to conspirators in Italy, further disguising the source of the funds.
According to the indictment, the defendants made more than 100 illegal wire transfers totaling more than $1.1 million to Li’s Hong Kong accounts to facilitate their criminal activity.
This case was jointly investigated by the HSI Newark Seaport Investigations Group and the Bergen County Prosecutor’s Office White Collar Crimes Squad, with significant assistance from Europol and Italy’s Guardia di Finanza.
The government is represented by Assistant U.S. Attorneys Leslie Schwartz and Sarah Devlin of the District of New Jersey, Senior Counsel Evan Williams and Rudy Orjales of the Criminal Division’s Computer Crime and Intellectual Property Section.
The enforcement action announced today is one of many efforts being undertaken by the Department of Justice Task Force on Intellectual Property (IP Task Force). The IP Task Force was created to combat the growing number of domestic and international intellectual property crimes, protect the health and safety of American consumers, and safeguard the nation’s economic security against those who seek to profit illegally from American creativity, innovation, and hard work. The IP Task Force seeks to strengthen intellectual property rights protection through heightened criminal and civil enforcement, greater coordination among federal, state, and local law enforcement partners, and increased focus on international enforcement efforts, including reinforcing relationships with key foreign partners and U.S. industry leaders. To learn more about the IP Task Force, go to: www.justice.gov/dag/iptaskforce/.
The charges and allegations contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Four Baltimore Area Drug Dealers Sentenced in Conspiracy to Distribute Cocaine and HeroinRead the Press Release
Baltimore, Maryland – Four defendants were sentenced to at least 10 years in prison in connection with a conspiracy to distribute cocaine and/or heroin, for attempting to possess with intent to distribute cocaine and/or heroin, and committing these crimes while on supervised release from previous federal convictions. All four defendants were convicted on March 20, 2015, after a nine day trial. Five other defendants previously pleaded guilty to their roles in the conspiracy.
U.S. District Judge Richard D Bennett sentenced Cornell Dion Brown, a/k/a “Nelly,” age 29, of Baltimore on June 30, 2015, to 12 years in prison, followed by five years of supervised release, for conspiracy to distribute cocaine and heroin, and for attempting to possess with intent to distribute cocaine.
On June 29, 2015, Judge Bennett sentenced Germaine Cannady, a/k/a “Jermaine Cannady,” and “Main,” age 39, to a total of 18 years in prison: 16 years in prison, followed by six years of supervised release, for the drug conviction; and two years in prison, consecutive to the sentence for the drug conviction, for violating his supervised release from two previous federal convictions. On June 26, 2015, Judge Bennett sentenced Dominic William Parker, a/k/a “Nick,” age 30, of Baltimore, to a total of 151 months in prison; 121 months in prison, followed by five years of supervised release, for the drug conviction; and an additional 30 months in prison for violating his supervised release from a previous federal conviction.
On June 25, 2015, Judge Bennett sentenced co-defendant Ronald Timothy Sampson, a/k/a “Little Ronald,” age 35, of Windsor Mills, Maryland, to a total of 13 years in prison: eight years in prison, followed by eight years of supervised release, for his role in the drug conspiracy; and five years in prison, consecutive to the sentence imposed for the drug conspiracy, for violating his supervised release from a previous federal conviction.
The sentences were 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; Acting Assistant Special Agent in Charge Shawn Ellerman of the Drug Enforcement Administration, Baltimore District Office; and Commissioner Anthony W. Batts of the Baltimore Police Department.
At the nine-day trial, the government argued that on August 11, 2014, each of the defendants agreed to purchase kilogram amounts of cocaine and/or heroin from a cooperating individual (CI). Law enforcement had previously seized 25 kilograms of cocaine and six kilograms of heroin from a concealed compartment in a motor home that the CI used to transport the drugs from California to Maryland. The defendants agreed to meet the CI in the parking lot of a Baltimore area mall to complete the drug transaction. The telephone calls with the defendants arranging the transactions were recorded.
Witnesses testified that Brown and co-defendant Tavon Hopkins were arrested after they arrived to pick up the four kilograms of cocaine Brown had agreed to purchase from the CI. At the time of their arrest, law enforcement recovered $157,000 in cash from a bag in their vehicle. Cannady and Parker were also arrested when they arrived at the meeting location to pick up the cocaine and heroin requested by Cannady. No cash was recovered from Cannady and Parker, although the CI explained that they were usually provided with heroin and cocaine without payment up front. Cannady and Parker had in their possession multiple cell phones and a police scanner.
According to evidence presented at trial, Sampson indicated that he wished to purchase cocaine and heroin. Sampson told the CI that he was calling up his buyers to get as much money as possible to give to the CI for the purchase of the cocaine and heroin. When Sampson met the CI to complete the drug transaction, he was also arrested. Law enforcement seized $10,500 after a search of Sampson and his vehicle.
According to court documents and their plea agreements, on August 11, 2014, Guy Agnant, Jr., Donte Taylor, and Antoine Washington were contacted by a cooperating individual (CI) concerning their desire to obtain drugs. As a result of the call from the CI, Agnant indicated to the CI that he wanted to purchase five kilograms of cocaine and Taylor indicated a desire to purchase cocaine and heroin. Agnant and Taylor went to meet the CI and were arrested. Washington traveled with co-defendant Vincent Cooper to meet the CI in order to purchase five kilograms of cocaine and one kilogram of heroin. Law enforcement saw Washington and Cooper arrive at the arranged meeting place and they were arrested. Between Washington and Cooper they had with them more than $223,000 to purchase the drugs.
Guy Bordes Agnant, Jr., age 38, of Laurel, Maryland was sentenced to 10 years in prison, for attempted possession with intent to distribute cocaine. Judge Bennett sentenced Antoine DeMarr Washington, age 42, of Washington, D.C. and Donte Eugene Taylor, age 39, of Baltimore, to 12 years in prison and five years in prison, respectively. Washington and Taylor had previously pleaded guilty to attempted possession with the intent to distribute cocaine and heroin. Vincent Cooper, age 47, of Washington, D.C., was sentenced to 11 years in prison, for his participation in the drug conspiracy and Tavon Alexander Louis Hopkins, age 38, of Baltimore also pleaded guilty and was sentenced to three years in prison.
United States Attorney Rod J. Rosenstein commended the FBI, DEA and Baltimore Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Christopher J. Romano and Seema Mittal, who prosecuted the case.
Former teacher pleads guilty to purchasing a firearm for a known felonRead the Press Release
CHARLESTON, W.Va. – United States Attorney Booth Goodwin announced that Jennifer Napier, 39, of East Bank, West Virginia pleaded guilty today in federal court in Charleston to straw purchasing a firearm for a person she knew to be a convicted felon. In October of 2011, Napier purchased a firearm from the Trading Post, a federally licensed firearms dealer, in Marmet, West Virginia, and she filled out a Department of Justice form required for anyone who purchases a firearm from a federally licensed dealer. On that form, Napier falsely stated that she was the transferee/buyer of the firearm, when she knew that the true transferee of the firearm was a different person who was prohibited from purchasing or possessing firearms because he was a convicted felon. As part of her plea agreement, Napier agreed to voluntarily surrender her permanent professional teaching certificate and not reapply to get her certificate back until her federal sentence, including any term of supervision, has expired. Napier faces up to five years’ imprisonment when she is sentenced on October 14, 2015.
This case was investigated by the Kanawha County Sheriff’s Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. The case is part of Project Safe Neighborhoods. Project Safe Neighborhoods is a nationwide commitment to reduce gun crime in the United States by networking existing local programs targeting gun crime.
Former Top GSA Official Sentenced to Three Months Imprisonment and Three Months Home DetentionRead the Press Release
SAN FRANCISCO- Jeffrey Neely, the former Acting Regional Administrator of the U.S. General Services Administration (GSA), was sentenced to three months imprisonment, to be followed by three months of home confinement, in connection with his guilty plea for making a false claim to the United States, announced United States Attorney Melinda Haag and GSA Office of Inspector General, Special Agent in Charge David House.
From June 2003 to May 2012, Neely, 59, of Gardnerville, NV, was the Regional Commissioner for the Public Buildings Service for GSA’s Pacific Rim Region, which includes California, Arizona, Hawaii, Nevada, American Samoa, the Northern Mariana Islands, Guam, and Saipan, as well as certain properties in Japan, Korea, Singapore, and elsewhere. Between March 30, 2009, and July 31, 2011, Neely was also Acting Regional Administrator, making him the top GSA official for the region.
Neely was indicted on September 25, 2014, on three counts of making false claims under 18 U.S.C. § 287, and two counts of making false statements and using false documents, under 18 U.S.C. § 1001. He pleaded guilty to one false claim count on March 31, 2015, admitting that he submitted a false reimbursement claim for lodging expenses at M Resort Spa Casino Las Vegas that he had not incurred for official business. Neely also admitted that he submitted and caused GSA to pay additional false claims during his tenure, that he improperly failed to claim annual leave on certain dates, that these acts constitute an abuse of his position of trust with GSA, and that he obstructed justice during GSA’s investigation.
“Mr. Neely has acknowledged he violated the special trust that was placed in him as a public servant,” said U.S. Attorney Melinda Haag. “His position with the government required that he be a good steward of government funds. Instead, he has admitted he abused his position and obstructed the investigation into his wrongdoing. He is being held accountable for his decision to violate the law.”
The sentence imposed by U.S. District Judge Richard Seeborg also included payment of $8,000 in restitution, a $2,000 fine, and a two year period of supervised release. Neely is scheduled to surrender and begin serving his sentence on August 14, 2015.
Assistant U.S. Attorney Hartley M.K. West prosecuted the case with the assistance of Rosario Calderon and Trina Khadoo. The prosecution was the result of an investigation by the GSA’s Office of Inspector General.
Former Systems Administrator Charged with Intentionally Damaging ComputersRead the Press Release
BATON ROUGE, LA – United States Attorney Walt Green announced that former Georgia-Pacific IT specialist and systems administrator BRIAN P. JOHNSON, age 43, of Baton Rouge, Louisiana, was arrested this morning after his indictment last week by a federal grand jury for intentionally damaging protected computers. The indictment charges that, from February 14, 2014 through February 27, 2014, JOHNSON intentionally damaged protected computers and thereby caused more than $5000 in losses to Georgia-Pacific entities.
In an affidavit filed in support of an application for a warrant to search JOHNSON’s home, FBI Special Agent David B. Clarke alleged that, a few hours after JOHNSON’s employment was terminated by Georgia-Pacific on February 14, 2014, Georgia-Pacific computer systems were attacked from a computer address assigned to JOHNSON. Over the next several days, according to Special Agent Clarke, Georgia-Pacific experienced multiple system failures as a result of continued attacks believed to have been instigated by JOHNSON.
If JOHNSON is convicted of the charged offense, he faces a term of imprisonment of up to ten years and a fine of up to $250,000 or twice the amount of loss suffered by Georgia-Pacific.
United States Attorney Green stated, “Cyber crime is one of the highest priorities of the Department of Justice. Attacks on computer systems threaten our security, our economy, and our privacy. Our office is committed to pursuing cyber criminals and to seeking justice and restitution for the companies and individuals they victimize.”
This matter is being investigated by the United States Attorney’s Office for the Middle District of Louisiana and the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorneys M. Patricia Jones and Ryan R. Crosswell.
NOTE: An indictment is an accusation by the Grand Jury. A defendant is presumed innocent until and unless he is adjudicated guilty at trial or through a guilty plea.
Former State Senator Leland Yee and Three Others Plead Guilty to RacketeeringRead the Press Release
SAN FRANCISCO – Former State Senator Leland Yee, Brandon Jackson, Keith Jackson, and Marlon Sullivan all pleaded guilty in federal court in San Francisco today to charges that they engaged in racketeering activity announced United States Attorney Melinda Haag and Federal Bureau of Investigation Special Agent in Charge David J. Johnson. By changing their pleas from “not guilty” to “guilty” the four codefendants now each have acknowledged they have participated in the affairs of an enterprise through a pattern of racketeering activity. Each defendant, all residents of San Francisco, has acknowledged guilt with respect to separate facts.
For his part, Yee, 66, acknowledged that he participated in two criminal enterprises, the Leland Yee for Mayor Campaign 2011 and the Leland Yee for Secretary of State campaign. In connection with these campaigns, Yee admitted he (1) accepted $10,000 in exchange for using his influence as a state senator to assist in the process of obtaining a grant from the California Department of Public Health, (2) conspired to extort money from individuals by suggesting he would cast favorable votes for specific legislation only if the money were paid, (3) accepted a $11,000 bribe in exchange for arranging a meeting with another state senator to discuss specific legislation, (4) conspired with others to purchase weapons in the Philippines and import them illegally into the United States, and (5) provided more than $6,000 in cash to a campaign aide knowing the aide would launder the money by arranging to convert the cash into checks made payable to Yee’s Secretary of State campaign. On January 29, 2015, a federal grand jury indicted Yee under a second superseding indictment with conspiracy to conduct the affairs of an enterprise through a pattern of racketeering activity, in violation of 18 U.S.C. § 1962(d); conspiracy to obtain property under color of official right, in violation of 18 U.S.C. § 1951(a); honest services conspiracy, in violation of 18 U.S.C. § 1349; scheme to defraud citizens of honest services and wire fraud, in violation of 18 U.S.C. §§ 1343 and 1346; conspiracy to traffic in firearms without a license and to illegally import firearms, in violation of 18 U.S.C. §§ 371, 922(a)(1), and 922(l); and conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(h). According to his plea agreement, Yee pleaded guilty to the racketeering charge and the remaining charges will be dismissed.
“Mr. Yee must now live with the consequences of betraying the trust that was placed in him when he became a public servant,” said U.S. Attorney Melinda Haag. “It is particularly disappointing and troubling when our elected officials violate their obligation to fairly represent their constituents. This office will continue to devote the resources necessary to ensure that our elected officials govern within the law.”
"Senator Yee's admission of guilt today brings some measure of justice to the true victims of his crimes: the people of the state of California," said David J. Johnson, FBI Special Agent in Charge of the San Francisco Field Office." When a public official uses his office for personal gain and as a platform for illegal activity, he not only betrays the people who elected him to office, but undermines the core principles of our system of government."
Keith Jackson, 50, was Yee’s political consultant and also pleaded guilty to a single charge of racketeering with respect to the same criminal enterprises: the Leland Yee for Mayor Campaign 2011 and the Leland Yee for Secretary of State campaign. In his plea agreement, Jackson admitted he (1) conspired with Yee to accept payments in exchange for providing official services from Yee in his capacity as a state senator, (2) conspired to extort money from individuals by suggesting he would cast favorable votes for specific legislation only if the money were paid, (3) received bribes on Yee’s behalf, (4) conspired with Yee to purchase weapons in the Philippines and import them illegally into the United States, and (5) reimbursed an individual with $3,000 in cash in exchange for two checks made payable to the Leland Yee for Secretary of State campaign knowing that the transaction constituted money laundering and was in furtherance of a weapons trafficking deal. Jackson was charged with 24 counts in the second superseding indictment (as compared to the 9 charges against Yee). The charges included use of interstate commerce facilities in the commission of murder for hire and conspiracy to distribute and possess with intent to distribute cocaine.
According to Sullivan’s plea agreement, he engaged in a separate criminal enterprise, the Chee Kung Tong (CKT). The plea agreement describes CKT as a predominantly Chinese American association, based in Chinatown in San Francisco, formed primarily for civic purposes to benefit the communities of Chinese immigrants and Chinese Americans. According to the plea agreement, CKT developed both positive legal community functions and criminal functions; “[s]ome members of the CKT were strictly involved the CKT’s legal functions and activities while other] members were also involved in illegal functions and activities.” Sullivan, 30, admitted he conspired with Keith Jackson and Brandon Jackson to purchase cocaine and to complete a murder-for-hire transaction. Sullivan further acknowledged being arrested just as he attempted to complete the cocaine transaction. With respect to the murder-for-hire transaction, Sullivan did not discover until after he agreed to perform the murder that both the person requesting the murder and the target were federal agents. Sullivan told one of the agents he could “‘pull it off’ because nobody would suspect me of being capable of murder, based on the fact that he was a licensed sports agent. Sullivan was referring to the fact that he was a sports agent licensed to represent players of, among other associations, the National Football League. Sullivan agreed to accept $10,000 in exchange for completing the murder. In addition, Sullivan admitted participating with Keith Jackson and Brandon Jackson in a scheme to illegally sell multiple firearms. Here again, Sullivan was unaware he was selling the arms to undercover federal agents. Sullivan was charged in the second superseding indictment with conspiracy to conduct the affairs of an enterprise through a pattern of racketeering activity, in violation of 18 U.S.C. § 1962(d); conspiracy to distribute and possess with intent to distribute cocaine, in violation of 21 U.S.C. § 846, 841(a)(1) and (b)(1)(A); three counts of dealing firearms without a license, in violation of 18 U.S.C. § 922(a)(1); and use of interstate commerce facilities in the commission of murder for hire, in violation of 18 U.S.C. § 1958.
According to Brandon Jackson’s plea agreement, he too participated in illegal activities through CKT. Jackson, 29, admitted that CKT was engaged in narcotics distribution, assault, robbery, extortion, collection of unlawful debt, murder for hire, money laundering, trafficking in stolen goods, illegal firearm possession, and obstruction of justice. Jackson admitted he tried to arrange for the purchase of 10 kilograms of cocaine from a Colombian supplier. The supplier turned out to be a non-existent person created by a federal agent. Jackson was arrested in Hartford, Connecticut, after flying there to complete the transaction. With respect to the murder-for-hire scheme, Jackson agreed to gather intelligence on the intended target including the target’s “daily routine.” Further, Jackson participated with Keith Jackson and Sullivan in the selling of multiple firearms. Brandon Jackson was charged in the second superseding indictment with conspiracy to conduct the affairs of an enterprise through a pattern of racketeering activity, in violation of 18 U.S.C. § 1962(d); conspiracy to distribute and possess with intent to distribute cocaine, in violation of 21 U.S.C. § 846, 841(a)(1) and (b)(1)(A); six counts of dealing firearms without a license, in violation of 18 U.S.C. § 922(a)(1); and use of interstate commerce facilities in the commission of murder for hire, in violation of 18 U.S.C. § 1958.
Yee and Keith Jackson remain out of custody pending their sentencing hearings. Sullivan and Brandon Jackson are in custody pending their sentencing hearings. All defendants are scheduled to be sentenced on October 21, 2015, at 10:00 a.m., before the Honorable Charles Breyer, U.S. District Judge, in San Francisco. The maximum statutory penalty for participating in the affairs of an enterprise through a pattern of racketeering activity in violation of 18 U.S.C. § 1962(d) is a 20 years of imprisonment, a fine of $250,000, plus restitution. However, any sentence will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant U.S. Attorneys William Frentzen, Susan Badger, and S. Waqar Hasib are prosecuting the case with the assistance of Rosario Calderon, Kurk Kosek, Ana Guerra, Marina Ponomarchuk, Victoria Etterer, and Lance Libatique. The prosecution is the result of an investigation by Federal Bureau of Investigation; San Francisco Police Department Gang Task Force; Oakland Police Department; Internal Revenue Service, Criminal Investigation; New York Police Department; and the Mercer County New Jersey Sheriff's Office.
Former State Senate Leader Malcolm Smith and Former Queens GOP Leader Vincent Tabone Sentenced in White Plains Federal Court for Bribery and Fraud Charges Connected to 2013 New York City Mayor’s RaceRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that former New York State Senate leader MALCOLM SMITH was sentenced today to seven years in prison for bribing New York City Republican Party leaders, including Queens County Republican Party Vice Chairman VINCENT TABONE, as part of a scheme to allow SMITH, a Democrat, to run as a Republican candidate for New York City Mayor in 2013 and for his role in obtaining New York State funding for a real estate project in Spring Valley, New York, in exchange for cash bribes paid on his behalf to the New York City Republican Party officials. TABONE was sentenced to 42 months in prison for receiving bribes and witness tampering. Both were convicted after a three-and-a-half week jury trial before U.S. District Judge Kenneth M. Karas, who imposed today’s sentences.
Manhattan U.S. Attorney Preet Bharara said: “Bribes and kickbacks should never play a role in the selection of candidates for public office. By attempting to buy and sell a spot on New York City’s Mayoral ballot, Malcolm Smith and Vincent Tabone corrupted one of the most fundamental tenets of the democratic process, that candidates cannot bribe their way onto a ballot. Today’s sentences make clear that the cost of violating the public trust in this way will be measured in years in a federal prison.”
According to the Complaint and the Indictment filed in federal court and the evidence presented at trial:
The Bribery and Extortion Schemes
SMITH was first elected to the New York State Senate in November 2000, and represented a district within Queens, New York. He was chairman of the Independent Democratic Conference of the State Senate and, among other positions, has served as the State Senate’s minority leader, majority leader, and acting lieutenant governor. From about November 2012, through April 2, 2013, SMITH agreed with former New York City councilman Daniel Halloran, who was convicted in a separate trial, and an undercover FBI agent posing as a wealthy real estate developer (the “UC”), and a cooperating witness (“CW”) to bribe New York City Republican Party county leaders, including TABONE, in exchange for their authorization for SMITH to appear as a Republican candidate for New York City Mayor in 2013, even though SMITH is a registered Democrat.
SMITH participated in two overlapping criminal schemes that involved the payment of bribes to obtain official action. First, SMITH, a registered Democrat, authorized the payment of $110,000 in cash bribes to be paid to leaders of the New York City Republican Party, including TABONE, so that they would allow SMITH to run for mayor on the Republican Party’s ballot line. Second, SMITH agreed to use his influence to help steer at least $500,000 in New York State transportation funding to a real estate project the UC and CW had proposed to develop in Spring Valley, New York, in exchange for the UC and CW paying bribes on SMITH’s behalf to the New York City Republican Party Chairs.
In furtherance of the scheme, SMITH authorized the UC and the CW to meet TABONE, the Executive Vice Chairman of the Queens County Republican Party, Joseph Savino, the Chairman of the Bronx County Republican Party, and other party leaders. During a meeting with the UC, TABONE accepted a $25,000 cash bribe in a dimly lit SUV parked in front of a Manhattan restaurant and agreed to accept another $25,000 after his committee authorized SMITH to compete in the Republican primary. Savino similarly accepted a $15,000 cash bribe and agreed to accept another $15,000 after he voted to authorize SMITH to compete for the Republican ballot line. In return for his efforts in negotiating the bribes, Daniel Halloran accepted $15,500 as a down payment on a “broker’s” fee of at least $75,000 and expected to be appointed First Deputy Mayor if Smith was elected mayor.
Witness Tampering
Shortly before the start of a previously scheduled trial, the Government sought permission from the Court to take the deposition of Philip Ragusa, the former Chairman of the Queens County Republican Party. Ragusa, who was gravely ill at the time, was expected to testify favorably to the Government. Over TABONE’s objections, the Court ordered the deposition to take place. TABONE unexpectedly appeared at Ragusa’s home an hour before the scheduled start of the deposition and attempted to pressure Ragusa not to testify against him.
* * *
SMITH, 58, of Queens, was also sentenced to two years of supervised release. TABONE, 48, of Queens, was sentenced to one year supervised release and ordered to forfeit $25,000. SMITH was ordered to surrender to the Bureau of Prisons on September 21, 2015. TABONE was ordered to surrender October 1, 2015.
Mr. Bharara praised the outstanding investigative work of the Federal Bureau of Investigation and the Rockland County District Attorney’s Office.
This case is being handled by the Office’s White Plains Division and Public Corruption Unit. Assistant United States Attorneys Douglas B. Bloom, Justin Anderson and Perry Carbone are in charge of the prosecution.
Former Silk Road Task Force Agent Pleads Guilty to Extortion, Money Laundering and ObstructionRead the Press Release
Ex-DEA Agent Used Undercover Status to Fraudulently Obtain Digital Currency Worth Over $700,000
A former DEA agent pleaded guilty today to extortion, money laundering and obstruction of justice, which he committed while working as an undercover agent investigating Silk Road, an online marketplace used to facilitate the purchase and sale of illegal drugs and other contraband.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Melinda Haag of the Northern District of California, Chief Richard Weber of the IRS-Criminal Investigation (IRS-CI), Special Agent in Charge David J. Johnson of FBI’s San Francisco Division, Special Agent in Charge Michael P. Tompkins of the Department of Justice Office of the Inspector General’s Washington, D.C. Field Office and Special Agent in Charge Lori Hazenstab of the Department of Homeland Security’s Office of the Inspector General in Washington D.C. made the announcement.
“While investigating the Silk Road, former DEA Agent Carl Force crossed the line from enforcing the law to breaking it,” said Assistant Attorney General Caldwell. “Seduced by the perceived anonymity of virtual currency and the dark web, Force used invented online personas and encrypted messaging to fraudulently obtain bitcoin worth hundreds of thousands of dollars from the government and investigative targets alike. This guilty plea should send a strong message: neither the supposed anonymity of the dark web nor the use of virtual currency nor the misuse of a law enforcement badge will serve as a shield from the reach of the law.”
“Mr. Force has admitted using his position of authority to weave a complex veil of deception for personal profit,” said U.S. Attorney Haag. “Mr. Force’s actions put at risk other important investigations and betrayed the trust placed in him by his law enforcement partners and the public. We are grateful for the work done by our federal partners to assist in unraveling this crime.”
“Through following the money in the Silk Road investigation it became clear that the defendant was engaged in wire fraud, money laundering, and other related offenses,” said Chief Weber. “He used his position in the investigation to bring himself significant personal financial gain. This investigation sends a clear message -- no person, especially those entrusted with the public’s trust such as federal law enforcement, is above the law and IRS-CI will use their financial investigative skills to track you down.”
Carl M. Force, 46, of Baltimore, Maryland, pleaded guilty before U.S. District Judge Richard Seeborg of the Northern District of California to an information charging him with money laundering, obstruction of justice and extortion under color of official right. Force’s sentencing hearing is scheduled for Oct. 19, 2015.
Force was a Special Agent with the DEA for 15 years. Between 2012 and 2014, he was assigned to the Baltimore Silk Road Task Force, a multi-agency group investigating illegal activity on the Silk Road. Force was the lead undercover agent in communication with Ross Ulbricht, aka “Dread Pirate Roberts,” who ran the Silk Road.
In connection with his guilty plea, Force admitted that, while working in an undercover capacity using his DEA-sanctioned persona, “Nob,” in the summer of 2013, Force offered to sell Ulbricht fake drivers’ licenses and “inside” law enforcement information about the Silk Road investigation, which information Nob claimed to have accessed through a corrupt government employee. Force admitted that he attempted to conceal his communications with Ulbricht about the payments by directing Ulbricht to use encrypted messaging. Although Force understood these payments, which were made in bitcoin, to be government property, as they constituted evidence of a crime, he admitted that he falsified official reports and stole the funds, depositing the bitcoin into his own personal account and then converting them into dollars. Force admitted that, at the time, the value of the bitcoin he received from Ulbricht was in excess of approximately $100,000.
Force also admitted that he devised and participated in a scheme to fraudulently obtain additional funds from Ulbricht through another online persona, “French Maid,” of which his Task Force colleagues were not aware. Force admitted that, as French Maid, he solicited and received bitcoin payments from Ulbricht worth approximately $100,000 in exchange for information concerning the government’s investigation into the Silk Road.
In connection with his guilty plea, Force also admitted that, in late 2013, in his personal capacity, he invested $110,000 worth of bitcoin in CoinMKT, a digital currency exchange company. Although he did not receive permission from the DEA to do so, he served as CoinMKT’s Chief Compliance Officer. In this role, in February 2014, Force was alerted by CoinMKT to what the company initially believed to be suspicious activity in a particular account. Force admitted that, thereafter, in his capacity as a DEA agent, but without authority or a legal basis to do so, he directed CoinMKT to freeze $337,000 in cash and digital currency from the account and he subsequently transferred the approximately $300,000 of digital currency funds into a personal account that he controlled.
Force also admitted to entering into a $240,000 contract with 20th Century Fox Film Studios related to a film concerning the government’s investigation into the Silk Road. Force admitted that he did not secure the necessary approvals from the DEA to do so.
According to his plea agreement, Force admitted that he had obstructed justice both by soliciting and accepting bitcoin from Ulricht and by lying to federal prosecutors and agents who were investigating potential misconduct by Force and others.
The investigation is ongoing. To date, Force is one of two federal agents charged with crimes in connection to their roles in investigating the Silk Road. Shaun W. Bridges, 32, of Laurel, Maryland, a former Special Agent with the U.S. Secret Service, is charged in a two-count information with money laundering and obstruction of justice related to his diversion of over $800,000 in digital currency that he gained control over as part of the Silk Road investigation. The charges contained in an information are merely accusations, and a defendant is presumed innocent until and unless proven guilty.
The case was investigated by the FBI’s San Francisco Division, the IRS-CI’s San Francisco Division, the Department of Justice Office of the Inspector General and the Department of Homeland Security Office of the Inspector General in Washington, D.C. The following additional components assisted with the investigation: IRS-CI’s New York Field Office, HSI’s Chicago/O’Hare Division, the U.S. Attorney’s Office for the Southern District of New York, the Criminal Division’s Computer Crime and Intellectual Property Section, the Criminal Division’s Office of International Affairs, the U.S. Embassy in Slovenia and the FBI Legal Attaché Office in Tokyo.
The case is being prosecuted by Assistant U.S. Attorneys Kathryn Haun and William Frentzen of the Northern District of California and Trial Attorney Richard B. Evans of the Criminal Division’s Public Integrity Section, with assistance from Assistant U.S. Attorney Arvon Perteet.
Force Plea Agreement
Former Silk Road Task Force Agent Pleads Guilty to Extortion, Money Laundering, and ObstructionRead the Press Release
SAN FRANCISCO – Carl M. Force pleaded guilty today to extortion, money laundering, and obstruction of justice in connection with his position as an undercover agent with the Drug Enforcement Administration announced U.S. Attorney Melinda Haag, Assistant Attorney General Leslie R. Caldwell, Chief Richard Weber of the IRS-Criminal Investigation (IRS-CI), Special Agent in Charge David J. Johnson of FBI’s San Francisco Division, Special Agent in Charge Michael P. Tompkins of the Department of Justice Office of the Inspector General’s Washington, D.C. Field Office and Special Agent in Charge Lori Hazenstab of the Department of Homeland Security’s Office of the Inspector General in Washington D.C.
Force, 46, of Baltimore, had been a Special Agent with the DEA for 15 years. Between 2012 and 2014, he was assigned to the Baltimore Silk Road Task Force, a multi-agency group investigating illegal activity on the Silk Road. Force was the lead undercover agent in communication with Ross Ulbricht, a/k/a “Dread Pirate Roberts,” who ran the Silk Road from the Northern District of California.
In the plea agreement entered today, Force admitted to being on Ulbricht’s payroll in a variety of ways while assigned to investigate Ulbricht and the Silk Road. For example, Force used his official undercover persona, “Nob,” to get Ulbricht to send bitcoin payments in exchange for information, including “insider” law enforcement information; ironically, Force duped Ulbricht into making payments in part by claiming Nob had access to a corrupt government employee. Then, rather than disclose Ulbricht’s payments or turn them over to the government, Force lied on official reports and stole the funds. Force liquidated the digital currency into dollars and had the funds deposited into his own bank account in order to convert the funds to his own personal use. Further, Force also created other unofficial and fictitious personas that he used to extort payment from Ulbricht. For example, Force convinced Ulbricht he was “French Maid” named Carla Sophia who was willing to sell inside law enforcement information about the government’s investigation into the Silk Road in exchange for approximately $100,000 worth of bitcoin. Ulbricht ultimately made the payment and Force, again, stole the funds.
Ulbricht and the government were not the only targets of Force’s scheme: Force also admitted in the plea agreement that he extorted “R.P.,” a California resident. R.P. maintained a digital currency balance with CoinMKT, a California digital currency exchange. Force directed CoinMKT to seize R.P.’s funds despite there being no legal basis to do so. Force then pocketed those sums belonging to R.P., once again transferring them to his own personal digital currency exchange and subsequently converting them to dollars using his personal bank account.
Force also admitted to abusing his position by engaging in a wide array of outside activities without permission while he was a federal agent, all designed to enrich himself. For example, in March 2014, while still employed as a DEA agent, Force entered into a movie contract with Twentieth Century Fox Film Studios related to a movie deal concerning the government’s investigation into the Silk Road. The movie deal called for up to $240,000 in payments to Force. Further, Force also moonlighted as a de facto compliance officer for CoinMKT, the same digital currency exchange involved with Force’s attempt to extort R.P. Force offered to help CoinMKT investigate its customers by using his position as a federal agent and his access to government databases. In addition, Force sent an unauthorized but official Justice Department subpoena to Venmo, a mobile payments company, directing them to unfreeze his own personal account. When Venmo did not comply, Force wrote to another agent suggesting a criminal seizure directed at Venmo’s accounts.
With the proceeds of his criminal activities, Force engaged in a series of complicated transactions, using the bitcoin block chain and several different accounts, all designed to conceal the true source and nature of the proceeds. In today’s plea agreement, Force also admitted he obstructed justice by interfering both with the evidence in the Baltimore case against Ulbricht, and with the San Francisco case into his own illegal acts. For example, Force admitted lying to federal prosecutors and investigators when he, among other things, denied ever using the moniker, “French Maid.” In his agreement with the government, Force has agreed to ask the Judge to impose sentencing enhancements for this obstruction.
“Mr. Force has admitted using his position of authority to weave a complex veil of deception for personal profit,” said U.S. Attorney Haag. “Mr. Force’s actions put at risk other important investigations and betrayed the trust placed in him by his law enforcement partners and the public. We are grateful for the work done by our federal partners to assist in unraveling this crime.”
“While investigating the Silk Road, former DEA Agent Carl Force crossed the line from enforcing the law to breaking it,” said Assistant Attorney General Caldwell. “Seduced by the perceived anonymity of virtual currency and the dark web, Force used invented online personas and encrypted messaging to fraudulently obtain bitcoin worth hundreds of thousands of dollars from the government and investigative targets alike. This guilty plea should send a strong message: neither the supposed anonymity of the dark web nor the use of virtual currency nor the misuse of a law enforcement badge will serve as a shield from the reach of the law.”
“Through following the money in the Silk Road investigation it became clear that the defendant was engaged in wire fraud, money laundering, and other related offenses,” said Chief Weber. “He used his position in the investigation to bring himself significant personal financial gain. This investigation sends a clear message -- no person, especially those entrusted with the public’s trust such as federal law enforcement, is above the law and IRS-CI will use their financial investigative skills to track you down.”
On June 22, 2015, Force was charged in a three-count information with money laundering with predicates of wire fraud and theft of government property, in violation of 18 U.S.C. § 1956(a)(1)(A) and (B); obstruction of justice, in violation of 18 U.S.C. § 1512(c)(2); and extortion under color of official right, in violation of 18 U.S.C. § 1951. Force’s sentencing is scheduled for October 19, 2015, at 2:00 p.m., before the Honorable Richard Seeborg, United States District Judge in San Francisco. The Plea Agreement calls for several sentencing enhancements that the parties agree the Court should impose. The maximum penalty for each count in the information is 20 years and $250,000, but any sentence following conviction would be imposed after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence.
Force is one of two federal agents to be charged with illegal activity in connection with the investigation into the Silk Road. Shaun W. Bridges, 32, of Laurel, Maryland, was a Special Agent with the U.S. Secret Service who also was assigned to the Baltimore Silk Road Task Force. Bridges was charged in a two-count information on June 16, 2015 with money laundering with a predicate of wire fraud, in violation of 18 U.S.C. § 1957, and obstruction of justice, in violation of 18 U.S.C. § 1512(c)(2), related to his diversion of over $800,000 in digital currency to which he gained control as part of the Silk Road investigation. In his plea agreement scheduled to be entered before Judge Seeborg on August 31, 2015, Bridges has admitted to the conduct with which he was charged.
The case is being prosecuted by Assistant U.S. Attorneys Kathryn Haun and William Frentzen of the Northern District of California and Trial Attorney Richard B. Evans of the Criminal Division’s Public Integrity Section, with the assistance of San Francisco Legal Assistant Daniel Charlier-Smith, Christine Tian and Lance Libatique. Assistant U.S. Attorney Arvon Perteet assisted with Asset Forfeiture aspects of the case. The case was investigated by the FBI’s San Francisco Division, the IRS-CI’s San Francisco Division, the Department of Justice Office of the Inspector General and the Department of Homeland Security Office of the Inspector General in Washington D.C. The prosecution team is also thankful for the assistance of the following components for their support throughout the investigation of this case: IRS Criminal Investigation – New York Field Office, HSI’s Chicago/O’Hare Division, the U.S. Attorney’s Office for the Southern District of New York, the Department of Justice’s Computer Crime and Intellectual Property Section, the U.S. Embassy in Slovenia, and the FBI Legal Attaché Office in Tokyo, Japan.
Former Orleans Parish School Board Employee Pleads Guilty to Conspiracy to Commit Federal Bribery and Honest Services Wire FraudRead the Press Release
U.S. Attorney Kenneth A. Polite announced that ARMER BRIGHT, 51, a resident of Baton Rouge and former employee of the Orleans Parish School Board (“OPSB”), pled guilty today to charges of conspiracy to commit bribery and honest services wire fraud.
According to court documents, BRIGHT admitted that beginning in September 2013 and continuing until January 2015, he and others participated in a conspiracy to commit bribery and honest services wire fraud. BRIGHT admitted that he initiated a scheme to defraud Orleans Parish and its citizens of honest services through bribery and a kickback scheme, whereby IRA THOMAS, an Orleans Parish School Board member, used his public office and official capacity to provide favorable treatment, including attempting to facilitate the awarding of a contract, that was designed to benefit the business and financial interest of an individual who provided him with a bribe and kickback in the form of cash payment disguised as a campaign contribution.
“Today’s guilty plea is the most recent – but not the last – example of our commitment to fighting public corruption,” said U.S. Attorney Polite. “Our investigation in this matter continues.”
BRIGHT faces statutory penalties of up to five years in prison, a $250,000 fine and three years of supervised release. U.S. District Judge Susie Morgan set sentencing for September 23, 2015 at 2:00 pm.
U.S. Attorney Polite praised the work of the Federal Bureau of Investigation in investigating this matter. Assistant U.S. Attorney Sean Toomey is in charge of the prosecution.
Armer Bright Factual Basis.pdf (14.82 KB)
Former Iowa State Researcher Sentenced for Making False StatementsRead the Press Release
Dr. Dong Pyou Han Sentenced to 57 Months Imprisonment for Falsifying HIV/AIDS Research.
DES MOINES, IA – On July 1, 2015, Dr. Dong Pyou Han, age 58, appeared in United States District Court and was sentenced to 57 months in federal prison based on his earlier guilty pleas to two counts of making false statements to the National Institutes of Health. Sentence was imposed by United States Senior District Court Judge James E. Gritzner, announced United States Attorney Nicholas A. Klinefeldt. Judge Gritzner also ordered that Dr. Han serve three years of supervised release following his release from federal prison. Dr. Han will be required to pay $7,216,890.12 in restitution to the National Institutes of Health.
United States Attorney Nicholas A. Klinefeldt stated, "It is important that we stand up not just for punishing the fraud committed against the United States government, but for the research that should be legitimately taking place on this devastating disease."
According to the Indictment, while conducting research on behalf of Iowa State University, Dr. Han falsified scientific data to make it appear an experimental HIV/AIDS vaccine, gp41, neutralized, or controlled, the HIV/AIDS virus in rabbits, when in fact the vaccine did not. The Indictment further alleges that Dr. Han spiked sera samples from gp41-immunized rabbits with human sera containing HIV antibodies. The spiking of the rabbit samples made it appear that gp41 produced neutralizing antibodies against the HIV/AIDS virus. The false data was reported to the National Institutes of Health in a research grant application and funded grant progress reports.
In his plea agreement, Dr. Han admitted he provided false data reported in National Institutes of Health Grant Application, "Enhancing B cell immunity against HIV-1 using novel vaccine delivery platforms" and National Institutes of Health Progress Report, "Characterization of immunogenic and structural properties of HIV-1 envelope." Dr. Han also admitted that data derived from his spiking rabbit sera samples with human antibodies was reported to the National Institutes of Health.
"Taxpayers fund medical research with the hope that promising scientific breakthroughs will result in much-needed treatments and cures for patients. Because the money for medical research is limited and the need for scientific advances is great, funding decisions must be based on the best information available. When Dr. Han faked lab results -- collecting scarce government medical research funding under false presentences -- he recklessly betrayed the public’s trust," said Special Agent in Charge Gerald T. Roy, U.S. Department of Health and Human Services Office of Inspector General. "Researchers who lie about their work will face the consequences."
This case was investigated by the United States Department of Health and Human Services – Office of the Inspector General, the Federal Bureau of Investigation, and the case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
Former Healthcare Executive Convicted of Embezzling over $200,000 from Non-Profit OrganizationRead the Press Release
BATON ROUGE, LA - United States Attorney Walt Green announced the conviction of TRAVIS TEMPLET, age 36, of Gonzales, Louisiana, who pled guilty today before U.S. District Judge John W. DeGravelles to engaging in a wire fraud scheme to defraud a non-profit health care organization, in violation of Title 18, United States Code, Section 1343. The defendant faces imprisonment and substantial fines, restitution orders, and forfeiture orders. The sentencing date has not yet been set.
In 2008, the defendant began working as the controller for a non-profit organization headquartered in Baton Rouge that manages nursing homes throughout Louisiana and Arkansas. During today’s hearing, the defendant admitted to using his position as controller to steal more than $208,307 from the organization from 2011 through 2014. He admitted doing so by writing approximately 67 fraudulent checks to himself from the organization’s account. To conceal the fraud, the defendant admitted that he altered the organization’s accounting records and software. He ultimately deposited the proceeds of his fraud into one of his personal accounts.
U.S. Attorney Green stated, “Fraud schemes perpetrated by insiders, particularly those entrusted with an organization’s finances, pose a serious threat to all organizations and, by extension, their employees. Our office will continue to aggressively pursue such matters, along with our federal, state, and local partners. Once identified, these fraudsters must not be allowed to simply move to their next victim employer. Employers and law enforcement must work together to stop them. I applaud the victim organization for uncovering the fraud and assisting in this important matter.”
This matter is being handled by the U.S. Attorney’s Office for the Middle District of Louisiana, the Baton Rouge Office of the United States Secret Service, and the East Baton Rouge Parish Sheriff’s Office. It is being prosecuted by Assistant United States Attorney Jessica M.P. Thornhill.
Former Correctional Officer Sentenced to over 4 Years in Prison in Baltimore Jail Racketeering ConspiracyRead the Press Release
Baltimore, Maryland – U.S. District Judge J. Frederick Motz sentenced former correctional officer Ashley Newton, age 31, of Baltimore, today to 51 months in prison, followed by three years of supervised release, for participating in a racketeering conspiracy and drug conspiracy, involving the smuggling of drugs and contraband inside the Baltimore City Detention Center (BCDC), and for money laundering conspiracy. Newton was convicted on February 5, 2015, after a more than two month long jury trial.
The sentence 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; Secretary Stephen T. Moyer of the Maryland Department of Public Safety and Correctional Services (DPSCS); Baltimore Police Commissioner Anthony W. Batts; and Baltimore City State’s Attorney Marilyn Mosby.
“Correctional officers were in bed with inmates, in violation of the first principle of prison management,” said U.S. Attorney Rod J. Rosenstein.
“We remain committed to protecting the public, our employees, and the inmates by aggressively rooting out corruption. We applaud the work of the U.S. Attorney and all of our law enforcement partners in this ongoing effort,” said Secretary Stephen T. Moyer of the Maryland Department of Public Safety and Correctional Services.
According to trial testimony and court documents, BGF has been the dominant gang at the Baltimore City Detention Center (BCDC), and in several connected facilities, including the Baltimore Central Booking Intake Center, the Women’s Detention Center, which houses many men, and in the Jail Industries Building. Tavon White and other BGF leaders and members incarcerated at BCDC were involved with and often directed the smuggling of contraband into BCDC, including cell phones, tobacco and drugs, through the services of correctional officers (COs), who received payments, gifts, or a share of the profits.
According to evidence presented at trial, Newton was a correctional officer (CO) at the BCDC who smuggled contraband into the jail for distribution by BGF inmates. In return, Newton and other COs received payments, gifts or a share of the profits.
According to trial evidence and other court documents, Newton smuggled drugs and other contraband for a succession of BGF leaders starting as early as 2008. She had long-term sexual relationships with at least two BGF inmates, including Duron Young, a/k/a Pinky. Newton smuggled pills, marijuana and tobacco for Young, and during the conspiracy, Newton smuggled pills for Pinky almost daily. Newton also opened cells doors of inmates for BGF members. For example, on May 19, 2011, Newton opened a grill that allowed a large number of BGF inmates to attack and repeatedly stab an inmate. In 2012, Young became angry at another inmate, whose offense was that he was transporting a lot of contraband around the prison for people other than Young. Newton opened the door of the inmate’s section to permit Young to go in with another BGF gang member and beat up the inmate. Newton also warned the BGF of upcoming prison searches by correctional officers. Newton arranged for money to be sent to inmates and facilitated phone conversations between inmates, including calls from other prisons to BGF leader Tavon White.
This case was developed as a result of the efforts of the Maryland Prison Task Force, formed in 2011 with the Maryland Department of Public Safety and Correctional Services, local, state and federal law enforcement agencies, and prosecutors. The Task Force has met regularly for over three years, generating recommendations to reform prison procedures and producing leads that have been pursued by state, local and federal criminal investigators. Investigations are continuing.
Forty of the 44 defendants charged in the racketeering conspiracy have been convicted, including 24 correctional officers. Thirty-five defendants pleaded guilty and five defendants were convicted after trial. Three defendants were acquitted and one defendant died.
To date, 22 of the correctional officers, including Newton, have been sentenced to up to 51 months in prison.
BGF leader Tavon White, age 37, pleaded guilty to his participation in the racketeering conspiracy and testified at the trial and was sentenced to 12 years in prison. Inmates and leaders in the BGF gang, Russell Carrington, a/k/ Rutt, age 34, and Joseph Young, a/k/a Monster, age 33, both of Baltimore, were convicted after trial and sentenced to 210 months in prison and 15 years in prison, respectively.
U.S. Attorney Rosenstein recognized the efforts of the other members of the Maryland Prison Task Force, including: the Maryland State Police, Prince George’s County Police Department, United States Marshals Office, DEA, Washington-Baltimore High Intensity Drug Trafficking Area and Maryland Coordination and Analysis Center.
United States Attorney Rod J. Rosenstein praised the FBI, Maryland Department of Public Safety and Correctional Services, Baltimore Police Department, and Maryland Prison Task Force, for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys Robert R. Harding and Ayn B. Ducao, who are prosecuting this Organized Crime Drug Enforcement Task Force case.
Five Individuals Sentenced for Their Role in Medicare and Medicaid Fraud Scheme in Florida, Nicaragua and the Dominican RepublicRead the Press Release
Five residents of Miami-Dade County and one resident of Nicaragua were sentenced yesterday for their participation in a $25.2 million Medicare, Medicaid, and wire fraud scheme. Erendira V. Delgado, a/k/a “Eren Delgado,” 31, of Miami, Edgardo Rodriguez, 47, of Nicaragua, Rodney Montoya, 36, of Miami, Deborah Smith, 53, of Hialeah, and Augustin Abaga, 48, of Sunny Isles, were sentenced by U.S. District Court Judge Federico A. Moreno in Miami.
Delgado was sentenced to 40 months imprisonment. E. Rodriguez was sentenced to 42 months imprisonment. Montoya was sentenced to 48 months imprisonment. Smith was sentenced to 15 months imprisonment. Abaga was sentenced to 18 months imprisonment. Each defendant was sentenced to serve a three year term of supervised release upon completion of their incarceration and pay restitution to the Centers for Medicare and Medicaid Services.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Pam Bondi, Florida Attorney General, Shimon R. Richmond, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and David Brown, Acting Special Agent in Charge, U.S. Department of State, Diplomatic Security Service (DSS), made the announcement.
On October 30, 2014, a federal grand jury in Miami returned a 36-count indictment charging Pedro Hernandez, a/k/a “Peter Hernandez,” 51, of Miramar, Freddy Zeron, 52, of Miami and Nicaragua, Delgado, E. Rodriguez, R. Montoya, Santiago Bernabe Montoya, 72, of Miami, Jose Eloy Sanchez, a/k/a “Jose Eloy Sanchez Arguello,” 70, of Coral Gables and Nicaragua, Abram J. Rodriguez, a/k/a “Abe Rodriguez,” 31, of Miami, Mirna L Blanco, 49, of Hialeah, Smith and Abaga for allegedly participating in a scheme to defraud Medicare and Medicaid by submitting false and fraudulent enrollment applications which claimed that beneficiaries resided in Florida when, in fact, they resided in Nicaragua and the Dominican Republic. The defendants were charged with conspiracy to commit health care fraud and wire fraud, substantive counts of health care fraud, conspiracy to defraud the United States and make false statements related to health care matters and substantive counts of making false statements related to health care matters.
Beginning on November 19, 2014, ten of the eleven individuals charged in the Indictment were arrested. Sanchez remains at large and is believed to be in Nicaragua. All ten individuals arrested pleaded guilty in federal court. Hernandez and A. Rodriguez pleaded guilty on Friday, June 19, 2015. Zeron pleaded guilty on Tuesday, June 23, 2015. S. Montoya pleaded guilty on May 14, 2015. They are scheduled to be sentenced on August 27, 2015, at 9:30 a.m. before the U.S. District Court Judge Federico A. Moreno.
Previously, on May 5, 2015, Blanco was sentenced to 24 months imprisonment after pleading guilty to conspiracy to commit wire fraud and health care fraud.
As part of the indictment, a Temporary Restraining Order (TRO) was obtained against A. Rodriguez and Montoya. Pursuant to the TRO, various banks froze over $150,000 that were allegedly held in the defendants’ accounts, in order to enjoin the ongoing fraud and restrain the dissipation of fraudulent proceeds.
According to allegations contained in the indictment, Florida Healthcare Plus (“FHCP”) was authorized by the Centers for Medicare and Medicaid Services to offer Medicare Advantage HMO plans to Medicare beneficiaries residing in Miami-Dade County, among other counties in Florida. The defendants recruited individuals who resided in Nicaragua and the Dominican Republic to enroll in Medicare Advantage plans and Florida Medicaid by falsely and fraudulently representing in enrollment applications that they resided in Florida. In these enrollment applications, the defendants represented that the foreign residents resided in Florida by using non-residential addresses, the addresses of beneficiaries’ friends and relatives, and addresses associated with the defendants. The defendants induced the individuals residing in Nicaragua and the Dominican Republic to enroll in Medicare Advantage plans, including FHCP plans, by making false and fraudulent representations, including that Medicare benefits were available in Nicaragua and the Dominican Republic. As a result of the submission of these false and fraudulent enrollment applications, the defendants caused the Center for Medicare and Medicaid services to make monthly capitation payments to FHCP and other Medicare Advantage plans. The defendants also caused the Florida Medicaid program to pay Medicare premiums and deductibles for many beneficiaries who did not reside in Florida, a benefit for which non-Florida residents would not be entitled.
Additionally, the defendants caused individuals associated with Pharmovisa Inc., Axis Le Professional Medical Group, Inc. (“Axis Le”), and Rodney Montoya Corp. in Miami, where defendant Montoya was employed as a doctor, to be designated as the primary care physicians for the beneficiaries residing in Nicaragua and the Dominican Republic. The defendants paid for the beneficiaries to travel from the Dominican Republic so that they could be seen by a U.S. licensed physician. The physician would then provide diagnoses which were used to calculate the amount of money Florida Health Care Plus and other Medicare Advantage plans would receive from Medicare. As a result of these false and fraudulent enrollment applications, the defendants obtained approximately $25,247,413 from Medicare and Florida Medicaid.
According to the indictment, Hernandez was the chief operating officer of FHCP until May 8, 2013, A. Rodriguez was the marketing director until on or about April 21, 2014. E. Rodriguez, Smith and Abaga were insurance agents employed by FHCP during the time of the scheme occurred. Blanco was employed by FHCP, as well as, Axis Le and Rodney Montoya Corp.
U.S. Attorney Wifredo A. Ferrer stated, “Health care fraud cripples the American social service system by increasing health care costs, stealing taxpayer monies that support the Medicare and Medicaid programs, and robbing individuals of quality of life benefits. This case demonstrates that, with the assistance of law enforcement partners, the U.S. Attorney’s Office is able to successfully combat these fraud schemes even when the offenders move the crime outside our shores.”
“This elaborate $25 million Medicare and Medicaid fraud scheme essentially stole millions of taxpayer dollars, and thanks to my Medicaid Fraud Control Unit and our partnerships with federal authorities, these individuals will be held accountable for their brazen actions,” said Attorney General Pam Bondi.
“Greed does not respect the law, does not concern itself with patient welfare and is not limited by international borders. Medicare patients and American taxpayers deserve better,” said Shimon R. Richmond, Special Agent in Charge, Office of Inspector General of the U.S. Department of Health and Human Services. “Working closely with our partners we will meet this greed at every turn and bring these criminals to justice.”
“These fraudsters attempted to cheat Medicare and Medicaid by falsely claiming that beneficiaries resided in Florida when in fact they were living in Nicaragua and the Dominican Republic. A novel idea, but not enough to thwart the hard work and diligence of the agents investigating this matter,” said George L. Piro, Special Agent in Charge, FBI Miami. “A special thanks goes to the U.S. Embassy Managua for their close cooperation and support.”
“The worldwide presence and investigative capabilities of the Diplomatic Security Service places us in the unique position to identify criminals who would defraud the U.S. government,” said David Brown, Acting Special Agent in Charge of the Miami Field Office of the Diplomatic Security Service. “Regardless of where they hide, we are able to work with our law enforcement partners -- both domestically and around world -- to bring these criminals to justice.”
Mr. Ferrer commended HHS-OIG, FBI, the Florida Office of the Attorney General, Medicaid Fraud Control Unit, and DSS for their investigative efforts.
Mr. Ferrer also thanked U.S. Department of State, Diplomatic Security Service, Regional Security Office, at the U.S. Embassies in Managua and Santo Domingo for their assistance with this investigation.
This case, brought as part of the Medicare Fraud Strike Force, under the supervision of U.S. Attorney’s Office for the Southern District of Florida, is being prosecuted by Assistant U.S. Attorney Eric E. Morales and Special Assistant United States Attorney Hagerenesh Simmons.
Since their inception in March 2007, Medicare Fraud Strike Force operations in nine locations have charged more than 2,300 defendants who collectively have falsely billed the Medicare program for more than $7 billion. In addition, the Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
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.
Fitchburg Man Sentenced to Seven Years on Federal Drug and Gun ChargesRead the Press Release
BOSTON – A Fitchburg man was sentenced yesterday in U.S. District Court in Worcester for selling heroin to a cooperating witness and being a felon in possession of a firearm and ammunition.
Miguel Rivera, 31, was sentenced by U.S. District Court Judge Timothy S. Hillman to seven years in prison and four years of supervised release. In March 2015, Rivera pleaded guilty to conspiracy to distribute heroin, distribution of heroin, and being a felon in possession of a firearm and ammunition.
Between May 2012 and October 2013, Rivera conspired with another individual to sell one hundred grams of heroin to a cooperating witness, and on Sept. 5 and Oct. 4, 2013, Rivera sold heroin to the cooperating witness. In addition, on Nov. 13, 2012, Rivera, having previously been convicted of a felony, illegally possessed a firearm and ammunition.
The charge of conspiracy and distribution of heroin provides for a minimum mandatory sentence of five years and no greater than 40 years in prison, a minimum of four years and up to a lifetime of supervised release, and a fine of $5 million. The charge of being a felon in possession of a firearm and ammunition provides for a sentence of no greater than 10 years in prison, three years of supervised release, and a fine of $250,000.
United States Attorney Carmen M. Ortiz; Daniel J. Kumor, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms & Explosives, Boston Field Division; Michael J. Ferguson, Special Agent in Charge of the Drug Enforcement Administration, Boston Field Division; and Fitchburg Police Chief Ernest Martineau, made the announcement. The case is being prosecuted by Assistant U.S. Attorney Michelle Dineen Jerrett of Ortiz’s Worcester Branch Office.
Financial Advisor Charged with Fraud Scheme Totaling More Than $3 MillionRead the Press Release
PHILADELPHIA - An indictment was unsealed today charging Malcolm Segal, 69, of Langhorne, PA, with six counts of mail fraud, and three counts of wire fraud, announced United States Attorney Zane David Memeger. Segal was a financial advisor with Aegis Capital Corporation at the time of the alleged scheme to steal funds from individuals who thought they were investing their money in Certificates of Deposit, and from investors who held funds in brokerage accounts at Aegis.
According to the indictment, between July 2011 and July 2014, Segal told client B.P. that Mercantile Bank and Bear Stearns were offering Certificates of Deposit (CDs) that were paying an annual interest rate of up to 12% with a minimum two-year investment of $100,000. Segal allegedly told individuals that he could sell them these CDs through Aegis. The indictment alleges that Segal accepted at least $100,000 from each of six victims, represented that he had purchased CDs on their behalf when he had not, mailed fraudulent deposit confirmations from National CD Sales Inc. to the victims, and mailed the victims checks which he represented as interest payments. According to the indictment, Segal used his victims’ money to pay personal expenses and to pay off other investors instead of purchasing CDs on behalf of the victims as promised. Segal allegedly stole an aggregate total of approximately $1,885,067.10 from the victims, representing the purchase price of the CDs less the purported interest payments. The indictment also alleges that Segal stole approximately $1,218,183.60 from the brokerage accounts of three of his clients at Aegis by making unauthorized wire transfers of funds from those brokerage accounts to a bank account controlled by Segal.
If convicted of all charges, Segal faces a potential advisory guideline sentencing range of 57 to 71 months in prison with a statutory maximum sentence of 180 years in prison.
The case was investigated by FBI and the United States Postal Inspection Service, and is being prosecuted by Assistant United States Attorney Joel D. Goldstein.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Federal Jury Convicts Absarokee Man of Firearms ChargeRead the Press Release
BILLINGS – An Absarokee man, Christopher Michael Emter, 37, has been convicted of being a felon in possession of a firearm following a jury trial in Billings, Montana. Emter is being detained pending sentencing, which U.S. District Court Judge Susan Watters set for October 7, 2015.
On January 12, 2013, a Billings resident notified law enforcement that his vehicle had been broken into and that two firearms had been stolen. One of the weapons stolen was a Sig Sauer .40 caliber pistol. On February 8, 2013, the Stillwater County Sheriff’s Office conducted an investigation into nine vehicles, which had been broken into and had items stolen from them while parked at the Stillwater Mine in Absarokee, Montana. Subsequent investigation revealed that credit cards taken from the vehicles had been used in local gas stations. Videos from that time period were reviewed and helped investigators determine that Emter was the prime suspect.
A search warrant was issued and executed on February 14, 2013, for Christopher Emter’s residence. Many items stolen from the Stillwater Mine vehicles were recovered. Additionally, the Sig Sauer pistol stolen in Billings in January was found at the residence. Prior to the search of the bedroom, Emter was found digging around in the closet and not responding to officer’s commands to show his hands. Officers located the Sig Sauer pistol in a tote in the closet. After the pistol was found, Emter fled the residence but was detained shortly thereafter. Emter is prohibited from possessing a firearm because of a prior felony criminal endangerment conviction in Yellowstone County.
Assistant U.S. Attorney Mike Lahr prosecuted the case, which was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Stillwater County Sheriff’s Office.
Former V.i. Army National Guard Major Convicted by Jury for Wire FraudRead the Press Release
St. Thomas, USVI – After a three-day trial, a federal jury found former Virgin Islands National Guard Major Sherrymae Morales, 54, guilty of 21 counts of wire fraud, United States Attorney Ronald W. Sharpe announced today.
DistrictCourt Judge Curtis V. Gomez set the sentencing hearing for October 20, 2015. Morales was ordered to self-surrender to the United States Marshals Service on July 15, 2015, at 3 p.m.
According to evidence presented at trial, from 2010 until 2011, Morales was employed as a full-time employee with the Virgin Islands National Guard (VING) on St. Croix. At the same time she was employed as a full-time VING employee, Morales also held a full-time contract position with the Military Personnel Services Corporation (MPSC), which provides employee support services to members of the VING. Evidence presented at trial demonstrated that Morales submitted time sheets to both the MPSC and VING for the same 40-hour work weeks over a period of 14 months.
Morales faces a maximum sentence of 20 years imprisonment and fines of up to $250,000 on each count of conviction. The case was investigated by the United States Army Criminal Investigation Command-Major Procurement Fraud Unit, Defense Criminal Investigative Service and U.S. Immigration and Customs Enforcement's Homeland Security Investigations. The case is being prosecuted by Assistant United States Attorney Everard E. Potter.
Executives Sentenced in Multi-Million Dollar Loan Fraud SchemeRead the Press Release
BOSTON – Two executives of a purported financing company were sentenced yesterday in U.S. District Court in Boston in connection with a multi-year scheme to defraud loan applicants of millions of dollars.
Damien John Hess, 37, of Laguna Niguel, Calif., was sentenced by U.S. District Chief Judge Patti B. Saris to 51 months in prison, three years of supervised release, and ordered to pay restitution of $2,881,925 and forfeiture. In November 2014, Hess pleaded guilty to one count of conspiracy to commit wire fraud and seven counts of wire fraud.
Lucas Ford, 38, of Post Falls, Idaho, was sentenced by Chief Judge Saris to three years of probation, with 10 months to be served in a halfway house. In June 2014, Ford pleaded guilty to conspiracy to commit wire fraud.
Hess was the chief executive officer and Ford the chief operating officer of Quest Capital Finance, a purported financing company that was, in reality, a front used to steal millions of dollars from prospective borrowers. As part of the scheme, Hess and Ford and others at Quest told applicants that, in order to obtain the promised loans, the applicants first needed to pay several hundred thousand dollars into a third-party escrow account where the money would be held until all contingencies for the loans were resolved. From 2008 through 2011, Hess and Ford used this approach to persuade businesses and individuals to put millions of dollars into escrow as deposits towards future loans. Hess, Ford, and others at Quest promised the borrowers that the deposits would not be moved out of escrow until the loans were funded. Instead, Hess transferred much of the money to Quest or to his own personal accounts while never actually arranging any financing. Quest never refunded the deposits.
United States Attorney Carmen M. Ortiz; Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and Shelly Binkowski, Inspector in Charge of the U.S. Postal Inspection Service, made the announcement. The case was prosecuted by Assistant U.S. Attorneys Sara Miron Bloom of Ortiz’s Economic Crimes Unit, Patrick Callahan of the Civil Division, and Doreen Rachal of the Asset Forfeiture Unit.
Evelyn Jean Vickers Sentenced to 110 Months on A-PVP ChargesRead the Press Release
GREENEVILLE, Tenn. – Evelyn Jean Vickers, 39, of Kingsport, Tenn., was sentenced on June 30, 2015, by the Honorable R. Leon Jordan, U.S. District Court Judge, to a federal prison term of 110 months for her role in an extensive a-PVP (alpha-pyrrolidinopentiophenone) distribution conspiracy centered in and around the Sullivan County area and for being a convicted felon in possession of a firearm. A-PVP is a synthetic drug which is commonly referred to on the street as “gravel” or “flakka.”
Vickers’s federal sentence was ordered to run consecutively to her sentences and probation revocations in Sullivan County General Sessions Court as well as any sentence that may be imposed in Sullivan County Circuit Court.
According to the plea agreement on file with the U.S. District Court Clerk, Vickers admitted that she conspired to distribute and was accountable for a conservative estimate of 5,200 grams of a-PVP between March 2012 and March 2014. In December 2013, Vickers, who was already a convicted felon, was arrested while in possession of a .22 caliber pistol in a room at a hotel in Kingsport, Tenn. Vickers admitted that she was one of the primary a-PVP distributors for co-defendant, Richard Hillman, 54, of Kingsport, Tenn., and for portions of the conspiracy, she sold an ounce of a-PVP per day.
Hillman is currently scheduled to be sentenced on August 13, 2015. Others who have been previously sentenced in this a-PVP trafficking investigation include Austin Michael Stallard, Johnny Michael Stallard, Phillip Wayne Mullins and Johnny White, who were respectively sentenced to serve 121 months, 180 months, 151 months and 120 months in federal prison.
Law enforcement agencies participating in the investigation which led to the indictment and subsequent conviction of Vickers and her co-defendants include the Drug Enforcement Administration, Bureau of Alcohol, Tobacco, Firearms, and Explosives, Homeland Security Investigations, Sullivan County Sheriff’s Office, Kingsport Police Department, Hawkins County Sheriff’s Department, Johnson City Police Department, Greeneville Police Department, Hendersonville, North Carolina Police Department, and Scott County, Virginia Sheriff’s Office. Assistant U.S. Attorney Wayne Taylor represented the United States.
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Elyria man charged with theft of government fundsRead the Press Release
A criminal information was filed charging Edward Erickson, 68, of Elyria, with theft of government money and property, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Erickson is accused of illegally receiving low-income pension payments from the Department of Veterans Affairs in the amount of $57,024, according to the information.
If convicted, the defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, and the defendant’s role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The investigating agency in this case is the Department of Veterans Affairs, Office of Inspector General-Criminal Investigations Division, Cleveland Resident Agency. The case is being handled by Assistant United States Attorneys Noah P. Hood and Gene Crawford.
District Court Enters Permanent Injunction against New Jersey Drug Manufacturer and its President to Stop Distribution of Unapproved and Misbranded DrugsRead the Press Release
The U.S. District Court for the District of New Jersey entered a consent decree of permanent injunction against Acino Products LLC, of Hamilton, New Jersey, and its president, Ravi Deshpande, to prevent the distribution of unapproved and misbranded drugs, the Department of Justice announced today.
Acino manufactures and distributes hydrocortisone acetate suppositories under the brand names Rectacort-HC and GRx HiCort 25. Deshpande is Acino’s president and is responsible for, and has authority over, all operations at the firm.
The department filed a complaint in the U.S. District Court for the District of New Jersey at the request of the U.S. Food and Drug Administration (FDA), alleging that the company’s suppositories are not approved by the FDA and that they are misbranded because they do not bear adequate directions for use as required by law.
In conjunction with the filing of the complaint, the defendants agreed to settle the litigation and be bound by a consent decree of permanent injunction that prohibits them from committing violations of the federal Food, Drug and Cosmetic Act. The consent decree requires the drug manufacturer to cease all manufacture and distribution of the unapproved and misbranded suppositories, and to destroy any such suppositories already in existence.
“The department will not hesitate to bring enforcement actions against manufacturers who do not follow the necessary procedures to comply with our nation’s drug safety laws,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Department of Justice’s Civil Division.
“Companies that manufacture and distribute drugs must comply with FDA regulations,” said FDA Associate Commissioner Melinda Plaisier of Regulatory Affairs. “Acino repeatedly violated federal law through their actions. We must continue to oversee manufacturers to ensure that patients have access to safe and effective approved drugs.”
The FDA has conducted at least three inspections of the facility between Feb. 6, 2014, and March 5, 2014; Aug. 7, 2014, and 19, 2014; and Jan. 12, 2015, and 25, 2015.
According to the complaint, during the February/March 2014 inspection, FDA investigators documented the company’s manufacturing of hydrocortisone acetate suppositories on behalf of Ascend Laboratories LLC. The complaint alleges that at the conclusion of the inspection, Deshpande indicated that he was aware that the suppositories were being marketed by Ascend as prescription drugs without FDA approval.
In May 2014, the government conducted a seizure of certain unapproved and misbranded drugs that were being distributed by Ascend, including suppositories that Acino had manufactured for Ascend. The government notified Acino and Deshpande of the seizure by a letter dated May 15, 2014. According to the complaint, the letter made clear that the suppositories were unapproved and misbranded drugs, however, Acino and Deshpande continued to manufacture the products.
According to the complaint, at the conclusion of the August 2014 and January 2015 inspections, FDA investigators again discussed the unapproved status of the hydrocortisone acetate 25 mg suppositories with Deshpande, who indicated that he was aware of the need to pursue FDA approval for the drug. As alleged in the complaint, to date, Acino and Deshpande have not filed the necessary application with the FDA to gain approval for the unapproved drug products.
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 Yen Hoang of the Department of Health and Human Services’ Office of General Counsel – Food and Drug Division, and Assistant U.S. Attorney Bernard J. Cooney of the District of New Jersey.
Dallas-Area Woman Sentenced for Conspiracy to Trafficking Minor into the New Orleans-AreaRead the Press Release
U.S. Attorney Kenneth A. Polite announced that ANDREA BIRDOW, age 24, from Sherman, Texas, was sentenced today after pleading guilty to conspiring with her boyfriend, TAUREAN JACKSON, to traffick a minor from the Dallas area into the New Orleans area for the purposes of that minor engaging in prostitution.
U.S. District Judge Susie Morgan sentenced BIRDOW to time served, followed by one year of supervised release.
According to court documents, BIRDOW met JACKSON, the creator and host of a Dallas-area radio program entitled, “Cheap Hoes Gotta Go,” in 2012, after JACKSON recruited her to join “Star City Vixens,” an entity he created to foster and promote prostitution. JACKSON became BIRDOW’s pimp and arranged for her to engage in sexual acts with others in exchange for money. JACKSON was responsible for advertising and scheduling prostitution calls with BIRDOW. JACKSON kept all, or most, of the proceeds from the prostitution calls. As a means of controlling BIRDOW’S behavior and ensuring her compliance, JACKSON beat and choked BIRDOW on multiple occasions, often in front of others. On several occasions, JACKSON burned BIRDOW with lit cigarettes to discipline her.
In mid-June 2013, JACKSON and BIRDOW met the victim, who was then 16-years-old, in the Dallas area and recruited her to begin working for JACKSON as a prostitute. Over the course of the next several weeks, JACKSON and BIRDOW drove the victim throughout Texas and Louisiana for the purpose of BIRDOW and the victim engaging in prostitution, which JACKSON advertised and arranged using an online classified advertisement. JACKSON arranged for the victim to watch BIRDOW engage in prostitution acts as a means of educating
her on the best way to perform sexual acts. To control the victim’s behavior, JACKSON beat BIRDOW in front of the victim, warning that he would do the same to the victim if she tried to leave him, and separately beat the victim with an extension cord. Ultimately, BIRDOW and the victim were arrested on July 10, 2013, in a Metairie hotel room by undercover law enforcement officers who responded to an online classified advertisement offering a prostitution date.
JACKSON pled guilty earlier this year and is scheduled to be sentenced on July 15, 2015.
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 Jefferson Parish Sheriff's Office for initiating the case, and the Federal Bureau of Investigation, with assistance from the FBI Dallas Child Exploitation Task Force, and the Dallas Police Department High Risk Victims Unit for investigating this case. Assistant United States Attorneys Jordan Ginsberg and Brandon Long are in charge of the prosecution.
Dallas Roommates Sentenced in Federal Firearms Offense CaseRead the Press Release
DALLAS — A convicted felon, who admitted conspiring with his roommates to have a federal jury acquit him at trial, was sentenced today, announced John Parker, Acting U.S. Attorney for the Northern District of Texas.
Chaddrick Darrion Ashley, 25, was sentenced today by U.S. District Judge Barbara M. G. Lynn to 180 months in federal prison. He pleaded guilty in March 2015 to one count of conspiracy to obstruct justice.
In April 2015, Ashley’s roommates, Daisy Emerson, 24, and Ofelia Nunez, 19, were each sentenced by Judge Lynn to 21 months in federal prison. Each pleaded guilty to one count of conspiracy to obstruct an official proceeding and one count of making a false declaration before a court.
According to documents filed in the case, Emerson and Nunez’s roommate, convicted felon Chaddrick Darrion Ashley, 25, was arrested on March 26, 2014, for possession of a firearm by a felon. Shortly after his arrest, Emerson conspired with Ashley and Nunez to come up with a strategy to exonerate Ashley. They agreed that Nunez would execute a false affidavit claiming she, not Ashley, owned the gun, and that Nunez had mistakenly left her gun in the car.
Nunez executed that false affidavit, and just days before Ashley’s trial on that offense in federal court, she executed a second affidavit affirming those facts. Both she and Emerson falsely testified in Ashley’s federal trial on the firearm offense in September 2014 to corruptly obstruct and influence those official proceedings. Nunez falsely testified as to several facts about events on the day of Ashley’s arrest, and Emerson falsely testified, denying any involvement in producing the false affidavit. The goal of their conspiracy was, through false affidavits and false testimony at trial, to have the jury acquit Ashley.
Ashley’s trial ended in a mistrial. Approximately one month later, however, a federal grand jury returned a superseding indictment charging him with one count of conspiracy to obstruct justice and one count of possession of a firearm by a convicted felon. He pleaded guilty to the conspiracy count, admitting he helped Emerson and Nunez execute a false affidavit and encouraged them to testify falsely at his trial.
The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated the case.
Convicted Felon Sentenced to 14.5 Years for Federal Firearm OffensesRead the Press Release
PENSACOLA, FLORIDA – Darius D. Williams, 24, of Pensacola, Florida, was sentenced to 14.5 years in prison late yesterday for possession of a firearm by a convicted felon and for possession of a stolen firearm. The sentence was announced by Pamela C. Marsh, United States Attorney for the Northern District of Florida.
During his guilty plea in February 2015, Williams admitted to knowingly possessing a stolen firearm, after prior convictions for felony offenses. In the early morning hours of September 14, 2014, a person was shot in the head outside a Pensacola bar. A responding law enforcement officer pursued a suspicious vehicle that was fleeing the scene of the shooting at a high rate of speed. When the vehicle stopped, Williams jumped from the rear seat, holding a .40 caliber Smith & Wesson pistol, and continued his flight on foot. Williams was ultimately apprehended, and the arresting officer recovered the firearm that Williams had discarded during his flight. Forensic tests revealed gunshot residue on Williams’s hands and clothes. Williams’s DNA was also found on the firearm. The victim of the shooting survived.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Drug Enforcement Administration, and the Escambia County Sheriff’s Office. It was prosecuted by Assistant United States Attorney David L. Goldberg.
The United States Attorney's Office for the Northern District of Florida is one of 94 offices that serve as the nation’s principal litigators under the direction of the Attorney General. The office strives to protect and serve the citizens of the Northern District of Florida through the ethical, vigorous, and impartial enforcement of the laws of the United States, to defend the national security, to improve the safety and quality of life in our communities through the protection of civil rights, and to protect the public funds and financial assets of the United States. To access public court documents online, please visit the U.S. District Court for the Northern District of Florida website. For more information about the United States Attorney’s Office, Northern District of Florida, visit http://www.justice.gov/usao/fln/index.html.
For more information, contact:
Amy Alexander, Public Information Officer
(850) 216-3854, [email protected]
Charleston man sentenced to more than three years in federal prison for illegal possession of a firearmRead the Press Release
Charleston, W.Va. – A Charleston man who illegally possessed a firearm was sentenced today in federal court in Charleston to 37 months in federal prison, United States Attorney Booth Goodwin announced. Travis Devon Woods, 26, previously pleaded guilty on March 12, 2015, to being a felon in possession of a firearm. On December 16, 2013, on the West Side of Charleston, members of law enforcement approached Woods to discuss an incident that had occurred nearby. When officers asked Woods to stop to speak with them, Woods fled on foot down a nearby alley. After a brief chase, law caught Woods and found a loaded Taurus .45 caliber semi-automatic pistol in the alley where Woods fled. The West Virginia State Police Forensic Library matched Woods’s DNA to DNA recovered from the weapon.
Woods had previously been convicted in Kanawha County, West Virginia, in 2009 of nighttime burglary and first degree robbery. The sentence imposed by the federal court will run consecutive to a state sentence that he is currently serving for parole violations.
The Charleston Police Department, with assistance from the Bureau of Alcohol, Tobacco, Firearms and Explosives, conducted the investigation. Assistant United States Attorney Jennifer Rada Herrald handled the prosecution.
This case was brought as part of Project Safe Neighborhoods. Project Safe Neighborhoods is a nationwide commitment to reduce gun crime in the United States by networking existing local programs targeting gun crime.
Buffalo Woman Sentenced on Drug Conspiracy ChargeRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
BUFFALO, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that Fannie Long, 53, of Buffalo, NY, who was convicted of conspiracy to distribute fentanyl, was sentenced to 96 months in prison by Senior U.S. District Judge William M. Skretny.Assistant U.S. Attorney Frank T. Pimentel, who handled the case, stated that between January 2009 and September 26, 2013, the defendant conspired with co-defendant Sherylrica Quisenberry to distribute controlled substances. Long obtained fentanyl prescriptions from medical professionals which were then filled and sold by the defendant. In addition, Long obtained fraudulent prescriptions which were not written by medical professionals. The prescriptions were made out in the names of individuals engaged by the defendant. These individuals would fill the fraudulent prescriptions and then turn the controlled substances over to Long for further distribution. The controlled substances included Lortab, Xanax and Soma.
Similar charges are pending against Sherylrica Quisenberry. 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 sentencing is the culmination of an investigation by the Drug Enforcement Administration, under the direction of Special Agent in Charge James J. Hunt, New York Field Office.
Authorities Arrest Six in Alleged Cocaine Trafficking RingRead the Press Release
HOUSTON – A total of six people have been taken into custody on allegations related to a cocaine conspiracy dating back to April 2011, announced U.S. Attorney Kenneth Magidson along with Special Agent in Charge Joseph M. Arabit of the Drug Enforcement Administration (DEA).
The charges are the result of a multi-year investigation and the return of a six-count sealed indictment April 29, 2015. The indictment was unsealed following the appearance of Isaac Heron, 37, and Douglas Ramirez, 32, both of Houston; and Leroy Greer, 51, of Missouri City, in federal court this morning. At that hearing, U.S. Magistrate Judge Mary Milloy ordered they remain temporarily in custody. They will appear in court again tomorrow at 2:00 p.m. for a counsel determination hearing.
Juan Banda, 42, Kevin Biggurs, 24, and Victor Oliva, 33, were also taken into custody today and are expected to make their initial appearances before Judge Milloy at 10:00 a.m. tomorrow.
Two more defendants - Eddie Bejar, 30, and Jean Lucio, 31, both also of Houston - are charged but not as yet in custody. They are considered fugitives and warrants remain outstanding for their arrests. Anyone with information about their whereabouts is asked to contact the DEA at 713-693-3000.
With the exception of Greer, all are charged with conspiracy to possess with the intent to distribute cocaine and aiding and abetting possession with intent to distribute cocaine. If convicted, they face a minimum of 10 years and up to life in federal prison as well as a possible $10 million fine. Greer is charged solely with two counts of structuring financial transactions and faces up to five years imprisonment and a possible $250,000 fine.
The case was result of an Organized Crime Drug Enforcement Task Force investigation led by the DEA with the assistance of Internal Revenue Service - Criminal Investigation and police departments in Pasadena and Houston. Assistant U.S. Attorney Mark E. Donnelly is prosecuting the case.
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.Armed Robber Pleads Guilty to Two Store RobberiesRead the Press Release
Baltimore, Maryland – Donte Maurice Johnson, age 30, of Baltimore, Maryland, pleaded guilty on June 30, 2015, to two commercial robberies and to using and brandishing a firearm during a crime of violence.
The guilty plea 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; Chief James W. Johnson of the Baltimore County Police Department; Commissioner Anthony W. Batts of the Baltimore Police Department; Baltimore County State’s Attorney Scott Shellenberger; and Baltimore City State’s Attorney Marilyn J. Mosby.
According to his plea agreement, on November 2, 2013, Johnson robbed a grocery on Claremont Avenue in Baltimore. Johnson held a shotgun to the store owner’s head and demanded money. A co-conspirator stood inside the door as a look-out. The robbers took between $600 and $700.
On November 25, 2013, Johnson and the co-conspirator robbed a convenience store, located on Philadelphia Road in Baltimore. Specifically, two employees were working at the counter area of the store and two men approached the counter. Donte Johnson pointed a shotgun at both employees and demanded that they open the registers. In fear for their lives, the clerks complied. Johnson reached over the counter and obtained money from one register. The co-conspirator walked behind the counter and retrieved money from another register. The total loss to the store was $153.
Donte Johnson continued to rob the store’s customers. As this was happening, a customer was able to leave the store and get into his vehicle, which was parked in the store’s parking lot. He called 911 and waited for the robbers to exit. The customer saw the robbers run across Philadelphia Road to the parking lot of a bar across the street, and enter a dark green Honda Civic. The customer followed Johnson and the co-conspirator so he would be able to give directions to the police. Once the robbers turned onto Square Ridge Road, the car stopped, and Donte Johnson fired one round from a shotgun at the customer in his vehicle.
Baltimore County Police detectives were able to locate the shotgun used in the convenience store robbery. The shotgun had two unfired shotgun shells lying on the ground next to it and one fired shotgun shell casing loaded in the action of the gun.
Johnson and the government have agreed that if the Court accepts the plea agreement Johnson will be sentenced to between 183 and 198 months in prison. U.S. District Judge Ellen L. Hollander has scheduled sentencing for September 2, 2015 at 2:15 p.m. Johnson remains detained.
United States Attorney Rod J. Rosenstein commended the FBI, Baltimore County Police Department, Baltimore City Police Department and the Baltimore County and Baltimore City State’s Attorney’s Offices for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorney Bonnie S. Greenberg, who prosecuted the case.
Area Man Sentenced for Failure to AppearRead the Press Release
St. Louis, MO – DARIUS ISOM, St. Louis, Missouri, was sentenced to an additional six months in prison for failing to appear to federal prison to serve his sentence.
According to court documents, on October 15, 2014, Isom was sentenced to 24 months of imprisonment upon his conviction for aggravated identity theft. He requested the Court to allow him to voluntarily surrender for service of his sentence instead of immediately being taken into custody. The Court granted Isom’s request and ordered him to surrender at the institution designated by the Bureau of Prisons when he was notified by United States Marshals. After being granted one extension, he was scheduled to surrender December 30, 2014, but failed to report as scheduled. When he was contacted by federal authorities, he advised them that he was in Atlanta, Georgia, and would report at the earliest, on January 6, 2015. He was directed to immediately surrender to a local U.S. Marshal’s Office to avoid the issuance of a warrant for his arrest. Isom refused, stating, “I’ve got to do what I’ve got do, and you’ve got to do what you’ve got to do.”
Isom appeared for sentencing today before United States District Judge Rodney W. Sippel.
This case was investigated by the United States Marshal’s Service. Assistant United States Attorney Anthony Franks handled the case for the U.S. Attorney’s Office.
Alice Man Sentenced for Possession of Child PornographyRead the Press Release
CORPUS CHRISTI, Texas – Jon Michael Charles, 26, of Alice, has been ordered to federal prison following his conviction of possessing child pornography, announced U.S. Attorney Kenneth Magidson.
Today, U.S. District Judge Nelva Gonzales Ramos sentenced Charles to 60 months in federal prison. Charles was further ordered to serve 10 years of supervised release following completion of his prison term and must register as a sex offender.
At the time of his plea, the court heard that FBI agents in Corpus Christi office received a cyber-tip from the National Center for Missing and Exploited Children about an individual using an email address to upload several images of child pornography to a file storage service provided by Google.
Agents learned the email address was associated with Charles and in July 2014, executed a search warrant at his residence, at which time they seized various electronic devices. Forensic analysis on those devices revealed more than 300 images and 10 videos of child pornography.
Charles has remained in custody since his arrest and will remain there pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future. The charges against him were the result of an investigation conducted by the FBI and the Corpus Christi Police Department’s Internet Crimes Against Children Task Force.
This case, prosecuted by Assistant U.S. Attorney Hugo R. Martinez, was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Albuquerque Resident Pleads Guilty to Federal Charges Arising Out of January 2015 Pharmacy Robbery and March 2015 Traffic StopRead the Press Release
ALBUQUERQUE – Victor Hurtado, 20, of Albuquerque, N.M., pleaded guilty today in federal court to felony charges arising out of a pharmacy robbery in Jan. 2015, and a traffic stop in March 2015. Under the terms of his plea agreement, Hurtado will be sentenced within the range of ten to 18 years in federal prison followed by a term of supervised release to be determined by the court. Hurtado also will be required to pay restitution to the pharmacy.
The guilty plea was announced by U.S. Attorney Damon P. Martinez, 2nd Judicial District Attorney Kari E. Brandenburg, Special Agent in Charge Carol K.O. Lee of the FBI’s Albuquerque Division, Special Agent in Charge Will R. Glaspy of the DEA’s El Paso Division, Chief Gorden Eden, Jr., of the Albuquerque Police Department, Chief Pete N. Kassetas of the New Mexico State Police.
Hurtado and his co-defendant, Joseph Montano, 22, also of Albuquerque, were two of six defendants charged in four indictments with robbing retail pharmacies in Albuquerque. The indictment against Hurtado and Montano alleged that the two men (1) violated the Hobbs Act by interfering with interstate commerce by robbery and violence; (2) brandished a firearm during a crime of violence; (3) violated the Controlled Substance Registrant Act by robbery involving controlled substance; (4) violated the Safe Doses Act by theft of medical products; and (5) possessed Oxycodone with intent to distribute. The charges against Hurtado and Montano arose from the Jan. 6, 2015, armed robbery of the Smith’s Pharmacy located at 4016 Louisiana Blvd. NE in Albuquerque.
During today’s proceedings, Hurtado pled guilty to Count 1, 2 and 5 of the indictment, charging him with robbing a commercial business engaged in interstate commerce; brandishing a firearm during a crime of violence, and possession of Oxycodone with intent to distribute. In entering the guilty plea, Hurtado admitted that on Jan. 6, 2015, he entered the Smith’s Pharmacy, jumped over the counter while brandishing a firearm, and ordered the pharmacist to open the safe where controlled substances were kept. He also admitted pointing the firearm at the pharmacy employees to gain their compliance, and that he stole bottles of Oxycodone from the pharmacy’s inventory.
Hurtado also pled guilty to a one-count felony information charging him with possession of methamphetamine with intent to distribute. Hurtado admitted that he was arrested on state charges on March 5, 2015, after an officer of the New Mexico State Police found approximately 54 grams of heroin and 133 grams of methamphetamine in the vehicle Hurtado was driving. Hurtado admitted that he and another person intended to distribute the drugs seized by the New Mexico State Police.
Hurtado has been in federal custody since his arrest on April 29, 2015, and remains detained pending his sentencing hearing, which has yet to be scheduled.
Montano has entered a not guilty plea to the indictment. He remains in federal custody pending trial. Charges in indictments are merely accusations and defendants are presumed innocent unless found guilty in a court of law.
This case was investigated by the Albuquerque office of the FBI, the Tactical Diversion Squad of the DEA in Albuquerque, the Albuquerque Police Department and the New Mexico State Police, with assistance from the 2nd Judicial District Attorney’s Office in Bernalillo County. The case is being prosecuted by Assistant U.S. Attorneys Joel R. Meyers and Shaheen P. Torgoley.
DEA’s Tactical Diversion Squads combine DEA resources with those of federal, state and local law enforcement agencies in an innovative effort to investigate, disrupt and dismantle those suspected of violating the Controlled Substances Act or other appropriate federal, state or local statutes pertaining to the diversion of licit pharmaceutical controlled substances or listed chemicals.
These cases are being prosecuted pursuant to 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.
The cases also are being prosecuted pursuant to the New Mexico Heroin and Opioid Prevention and Education (HOPE) Initiative. The HOPE Initiative is a collaborative effort between the U.S. Attorney’s Office and the University of New Mexico Health Sciences Center that is partnering with the Bernalillo County Opioid Accountability Initiative with the overriding goal of reducing the number of opioid-related deaths in the District of New Mexico. The HOPE Initiative comprised of five components: (1) prevention and education; (2) treatment; (3) law enforcement; (4) reentry; and (5) strategic planning. The law enforcement component of the HOPE Initiative is led by the Organized Crime Section of the U.S. Attorney’s Office and the DEA in conjunction with their federal, state, local and tribal law enforcement partners. Targeting members of major heroin and opioid trafficking organizations for investigation and prosecution is a priority of the HOPE Initiative.
Alamogordo Man Pleads Guilty to Violating the Federal Firearms LawsRead the Press Release
ALBUQUERQUE – Kenneth Colby Miller, 31, of Alamogordo, N.M., pleaded guilty today in federal court in Las Cruces, N.M., to violating the federal firearms laws by possessing an unregistered firearm. Under the terms of his plea agreement, Miller will be sentenced to 30 months in prison followed by more than three years of supervised release.
Miller was arrested on April 30, 2015, on a criminal complaint charging him with possession of an unregistered firearm. According to the complaint, on Dec. 3, 2014, in Chaves County, N.M., an officer with the Roswell Police Department conducted a routine traffic stop on Miller’s vehicle, and after a consensual search, the officer recovered a single shot “sawed-off” shotgun with no visible serial number or manufacturers markings. After further investigation, Miller’s background also revealed that he had been convicted twice of unlawful taking of a motor vehicle and reckless driving.
During today’s proceedings, Miller pled guilty to a felony information charging him with possession of an unregistered firearm. In entering the guilty plea, Miller admitted that on Dec. 3, 2014, he possessed a sawed off 20 gauge shotgun which did not have a serial number and was not registered to him in the National Firearms Registration and Transfer Record.
Miller has been in custody since his arrest and remains detained pending a sentencing hearing which has yet to be scheduled.
This case was investigated by the Las Cruces office of the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Roswell Police Department. Assistant U.S. Attorney Luis A. Martinez of the U.S. Attorney’s Las Cruces Branch Office is prosecuting this case.
30 June 2015
Woman in Prison for BP Oil Spill Fraud Now Charged with Food Stamp Fraud and Tax EvasionRead the Press Release
BIRMINGHAM -- Federal prosecutors have charged a McCalla woman, already serving time for attempting to defraud the Gulf Coast oil spill claims fund, with food stamp fraud and evading income taxes, announced U.S. Attorney Joyce White Vance, Internal Revenue Service, Criminal Investigation, Special Agent in Charge Veronica Hyman-Pillot, and U.S. Department of Agriculture Office of Inspector General, Investigations, Special Agent in Charge Karen Citizen-Wilcox.
The U.S. Attorney's Office last week charged SHERICA LACEY LEE, 33, with one count of tax evasion and one count of wire fraud through an information filed in U.S. District Court. The information also seeks to have Lee forfeit $23,757 to the government as proceeds of illegal activity. The government also filed a plea agreement with Lee in which she agrees to plead guilty to the charges and to pay restitution of $134,448 to the IRS for taxes not paid in 2008 through 2010, plus $23,757 to the Department of Agriculture for food stamp benefits she was not eligible to receive between July 2009 and June 2013. Lee also consents, additionally, to forfeit the $23,757 sought in the information.
"This defendant is in prison for trying to steal money intended for the victims of the massive BP oil spill in the Gulf of Mexico, and now she must face the charges that she stole from U.S. taxpayers and from money intended to feed poor families," Vance said. "Fraud seemed to be this defendant's default mode, but government agencies and this office hit the kill switch."
"Sherica Lacey Lee attempted to evade her tax obligation by not reporting all of her income to the Internal Revenue Service,” Hyman-Pillot said. "Tax evasion undermines the integrity of our nation’s tax system, which is built on voluntary compliance. IRS Criminal Investigation will continue to enforce the nation’s tax laws and recommend prosecution on individuals who choose to violate our tax system.”
The information charges Lee evaded income taxes for 2008 by preparing and submitting a personal tax return that falsely reported she had no taxable income, when she had $229,147 in taxable income that year. Lee ran a tax preparation business, Lacey's Income Tax Service, with several locations in the Birmingham area. Between 2008 and 2010, according her plea agreement, Lee's company filed more than 2,000 tax returns and generated about $2.5 million in receipts.
The information also charges Lee with wire fraud as part of a scheme to obtain federal benefits from the USDA Supplemental Nutrition Assistance Program. USDA administered SNAP, formerly known as the Federal Food Stamp Program, in conjunction with the Alabama Department of Human Resources.
Although Lee had income in excess of $200,000 in 2009, she applied for SNAP benefits by falsely stating on her application to DHR that she had no household income, cash on hand, or money in the bank, according to her plea agreement. Lee submitted additional false application forms in 2010, 2011 and 2012. Her applications caused the $23,757 in SNAP benefits to be wired to an account established in her name and loaded monthly onto an Electronic Benefit Transfer card, which could be used as a debit card to purchase food.
Lee was sentenced in June 2014 to one year and a day in prison for attempting to defraud the Gulf Coast Claims Facility. As part of Lee's plea agreement in the current case, she and the government agree to a prison sentence of 24 months, unless the low end of the U.S. Sentencing Guideline range is more than 24 months. In that case, the government would recommend the low end of the guideline range. The government also would recommend that Lee's sentence run concurrently with the sentence she is now serving.
IRS, Criminal Investigation, and USDA-OIG investigated the case, which Assistant U.S. Attorney Pat Meadows is prosecuting.
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Wisconsin Man, Edward Joseph Peterson, Sentenced to Seven Years for Repeated Child Sexual Abuse on Indian Land Near PetoskeyRead the Press Release
GRAND RAPIDS, MICHIGAN – Edward Joseph Peterson, 61, of the Lac Du Flambeau Band of the Lake Superior Chippewa tribe in Wisconsin, received a seven-year sentence in federal prison for child sexual abuse on June 29, 2015. A grand jury charged Peterson with seven counts of abusive sexual contact with four different children under 12 years old from 2009 to 2011. Peterson pled guilty to one count, and the judge ordered him to pay $100,000 in restitution to the victims for counseling.
In 2009, two young girls in the Little Traverse Bay Band of Odawa Indians reported that Peterson touched them on their breasts and buttocks while they were visiting his house on tribal land in Emmet County, near Petoskey. In 2011, two more girls reported that Peterson touched their genitals and buttocks, also on tribal land. A fifth girl later reported that Peterson also sexually abused her. In 2012, the FBI interviewed Peterson about the allegations, which he denied. Following the interview, while the investigation continued, Peterson sexually abused another young girl in Wisconsin. As a result, Peterson pled guilty in Wisconsin state court in 2014 to First Degree Child Sexual Assault and is currently serving a four-year sentence. U.S. District Judge Robert Holmes Bell ordered the federal sentence to be served consecutively to the state sentence, totaling a combined sentence of 11 years. Peterson will be subject to a 10-year period of federal supervised release after prison and will be required to register as a sex offender.
At the sentencing hearing, U.S. District Judge Bell read aloud from a number of statements written by the victims and their parents. All the statements discussed both an intense sense of betrayal and anger, as well as the need for ongoing counseling on the girls’ road towards recovery. In delivering the sentence, Judge Bell stated that Peterson has "no respect for the law, or even for people." He noted the importance of protecting the public from Peterson, especially given that Peterson abused yet another child after being notified by the FBI of the investigation into child sexual abuse in Michigan.
In announcing the sentence, U.S. Attorney Patrick Miles stated, "I applaud the children in this case for having the bravery to report what happened to them rather than suffering in silence. The fact that all the children described the same type of abuse over time shows a disturbing pattern of pedophilia and conveys the danger that Peterson presents to communities everywhere."
"The defendant in this case sexually abused a number of children, displaying an utter disregard for human decency and the law," stated Paul M. Abbate, Special Agent in Charge of the FBI Detroit Field Office. "Those same children demonstrated remarkable courage, bravely reporting the crimes in the face of their abuser and helping to bring an end to the perpetrator’s abusive actions. The FBI and its tribal law enforcement partners continue working to protect our communities and combat sexual predators who commit such depraved criminal acts."
Leaders from the Little Traverse Bay Band of Odawa Indians, where the offenses took place, attended the sentencing. The tribe’s Chairperson and the Chief of Police stated, "Fortunately, we do not have a large number of criminal cases arising from our tribe, but when a crime like this occurs, we are glad to see tribal and federal law enforcement working together for justice and are committed to providing whatever services the victims might need as they heal."
The federal investigation was conducted by the FBI in collaboration with tribal law enforcement. Assistant U.S. Attorneys Jeff J. Davis and Tessa K. Hessmiller prosecuted the case.
This case is part of Project Safe Childhood, a nationwide initiative designed to protect children from exploitation and abuse. The U.S. Attorney’s Office; county prosecutor’s offices; and federal, state, and local law enforcement are working closely together to locate, apprehend, and prosecute individuals who exploit children. Individuals with information or concerns about possible child exploitation should contact local law enforcement. For more information about Project Safe Childhood in West Michigan, including resources for children and parents, visit: http://www.justice.gov/usao/miw/programs/psc.html.
Wife of Department of Defense Employee and Subcontractor Conspire to Fraudulently Obtain over $750,000 from Contracts with Aberdeen Proving GroundRead the Press Release
Baltimore, Maryland – Sandra Nixon, a/k/a “Lisa Hart,” age 52, of Silver Spring, and Kenneth Dawson, age 52, of Niceville, Florida, pleaded guilty today to conspiring to defraud the United States.
The guilty pleas were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Frank Robey, Director of the U.S. Army Criminal Investigation Command's Major Procurement Fraud Unit; Special Agent in Charge Robert Craig of the Defense Criminal Investigative Service - Mid-Atlantic Field Office; and Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation.
"Ms. Nixon and Mr. Dawson unlawfully manipulated the federal contracting process, a system the public expects to be fair and transparent, and that the Defense Department relies upon to support our men and women in uniform," said Robert Craig, Special Agent in Charge for the DCIS, Mid-Atlantic Field Office. "The Defense Criminal Investigative Service, its law enforcement partners, and the U.S. Attorney's Office are committed to maintaining the integrity of the contracting process through the identification and investigation of those alleged to have abused it."
Sandra Nixon was married to co-defendant Mark Nixon. Mark Nixon was a civilian employee of the Department of Defense, and worked at the U.S. Army Research Laboratories (ARL) in Hampton, Virginia, and Aberdeen, Maryland. From 2008 to December 2010, Nixon was the director of the Vehicle Technology Directorate with ARL at Aberdeen Proving Ground. Kenneth Dawson was a longtime friend of the Nixons.
Sandra and Mark Nixon also had a financial interest and management role in the operation of the following companies: Motile Robotics, Inc. (MRI), located in Joppa, Maryland; Atlantic Capital Enterprises (ACE); and Arrow Technical Incorporated (ATI).
Sandra and Mark Nixon reached an agreement with Kenneth Dawson to create and operate MRI. Dawson had full time employment with two different defense contractors that required him to report to work at Eglin Air Force Base in Florida, where he lived. In 2007, Dawson used his personal credit cards to pay for startup costs associated with MRI, and the Nixons reimbursed Dawson for these expenses. Although Dawson was the supposed president of MRI, in reality, Sandra and Mark Nixon created MRI, provided significant input regarding its operation, and were in effect a silent and undisclosed partner, owner and co-president. They helped operate MRI using the aliases “Lisa Hart” and "Paul Martin" in order to conceal their financial interest.
According to their plea agreements, in 2008, Mark Nixon determined that microsystem controls research was needed, including the fabrication of a small open-jet wind tunnel. Mark Nixon created and approved government documents that caused ARL to fund this research, and became the designated team leader for ARL on the research project.
In January 2009, the United States awarded a large defense contractor a task order to construct the open flow wind tunnel from February 2008 to 2011, worth approximately $3.6 million. Mark Nixon persuaded the defense contractor to use MRI as a subcontractor. Mark Nixon also played an important role in the government awarding the defense contractor another task order to construct a closed circuit wind tunnel from January 2009 to 2011, for approximately $3.5 million, under which MRI was a subcontractor. Mark Nixon provided the contracting officer with a technical evaluation of the contract and its cost, and acted as the government official overseeing and managing this work on a routine basis.
Pursuant to the conspiracy, the United States was billed for more than $35,000 in false labor charges by a relative of Sandra Nixon, who was characterized as an aerospace engineer. In reality, the relative was a retired school employee. Although Mark Nixon knew that he had a prohibited financial interest in MRI, he conducted a technical evaluation of MRI’s capabilities as a subcontractor, and approved the false invoices.
MRI received more than $5 million in federal funds under these task orders. Mark Nixon caused MRI to pay money to ATI, and ATI to pay ACE. The three defendants personally benefited from over $750,000 sent to these companies. The Nixons personally received more than $400,000 as a result of the task orders awarded to MRI.
Sandra Nixon and the government have agreed that if the Court accepts her plea agreement, Nixon will be sentenced to six months in prison followed by three years of supervised release. Kenneth Dawson faces a maximum sentence of five years in prison. Sandra Nixon and Dawson also agree to pay restitution of at least $750,000. U.S. District Judge Marvin J. Garbis has scheduled sentencing for Sandra Nixon on October 2, 2015 at 9:30 a.m. and for Kenneth Dawson on October 30, 2015 at 10:00 a.m.
Mark Nixon, age 54, of Silver Spring, Maryland, pleaded guilty on June 15, 2015 to the conspiracy and to acts affecting a personal financial interest. Mark Nixon and the government have agreed that if the Court accepts his plea agreement, Nixon will be sentenced to 42 months in prison followed by three years of supervised release. Mark Nixon also agrees to forfeit and pay restitution of at least $750,000. Mark Nixon is scheduled to be sentenced on September 18, 2015 at 9:30 a.m.
The National Procurement Fraud Task Force was formed in October 2006 to promote the early detection, identification, prevention and prosecution of procurement fraud associated with the increase in government contracting activity for national security and other government programs. The Procurement Fraud Task Force includes the United States Attorneys’ Offices, the FBI, the U.S. Inspectors General community and a number of other federal law enforcement agencies. This case, as well as other cases brought by members of the Task Force, demonstrate the Department of Justice’s commitment to helping ensure the integrity of the government procurement process.
United States Attorney Rod J. Rosenstein commended the U.S. Army Criminal Investigation Command's Major Procurement Fraud Unit, DCIS and FBI for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Harry M. Gruber and P. Michael Cunningham, who are prosecuting the case.