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30 June 2015
Westlake police officer indicted for excessive force, obstructionRead the Press Release
A Westlake police officer was indicted in federal court for excessive use of force on an arrested suspect and subsequently attempting to cover up the incident, law enforcement officials said.
Robert Toth, 48, of North Olmsted, was indicted on one count of excessive use of force and two counts of obstruction.
Count 1 charges Toth, in his capacity as a police officer, with causing bodily injury to someone identified as T.A. on or about April 24, 2014. In doing so, Toth deprived T.A. of his Constitutional right to be free from the unreasonable use of force by a law enforcement officer.
Count 2 charges that between April 25, 2014, and May 1, 2014, Toth knowingly falsified a document – specifically an official report concerning the arrest of T.A. – with the intent to impede, obstruct and influence the investigation and proper administration of that matter.
Count 3 charges that on May 3, 2014, Toth impeded an investigation by providing false information to a federal law enforcement officer surrounding the encounter with and arrest of T.A.
“The vast majority of police officers do their jobs with courage and honor,” U.S. Attorney Steven M. Dettelbach said. “However, when we believe that the evidence demonstrates that an officer has intentionally crossed the line into criminal conduct, we will not hesitate to take appropriate action. I want to compliment the FBI on their thorough and professional investigation into this matter.”
This case is being prosecuted by Assistant U.S. Attorneys Bridget M. Brennan and Chelsea Rice following an investigation by the Federal Bureau of Investigation’s Cleveland office.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant's role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Wasi Syed and Shahab Mir Plead Guilty in Stolen Polysilicon CaseRead the Press Release
United States Attorney Kenyen R. Brown of the Southern District of Alabama announces that Wasi Ismail Syed, age 38, of McKinney, Texas, and his brother-in-law Shahab Uddin Mir, age 35, of Frisco, Texas, have each pled guilty to two conspiracy charges related to a scheme to buy and sell stolen polysilicon and to launder the proceeds from these transactions. William Short of Loxley, Alabama, George Welford of Gautier, Mississippi, and Darlene Row of Dallas, Texas, have all previously pled guilty to their roles in these conspiracies.
William Short and George Welford are former employees of the Mitsubishi Polysilicon manufacturing plant located in Theodore, Alabama. The plant produces exceptionally high-grade polysilicon, which is a material used in the manufacturing of computer chips that control high-tech devices from super computers, to hospital equipment, avionics, and weapons systems. The polysilicon produced at the Theodore plant is ultra-pure. There are only four plants in the United States, and approximately a dozen worldwide, that produce this type of high-grade polysilicon.
In late 2008, Short and Welford began stealing polysilicon rods from the Mitsubishi plant. Using reinforced backpacks and lunch pails, Short and Welford walked several rods per day out of the plant and into their vehicles. Before long, Short and Welford had stolen so much polysilicon that they needed a storage unit, and ultimately a warehouse to house the stolen material. Since the rods were stolen very shortly after coming out of the reactors, they were not etched or vacuum-sealed in a clean room like the finished rods coming out of the plant. Consequently, the rods lacked the normal specification sheets that are attached to the packaging.
Soon after they started stealing the polysilicon rods, Short and Welford began looking for a purchaser. Using the aliases William Smith (Short) and Butch Cassidy (Welford), the pair found Horizon Silicon online. The Dallas, Texas-based company was owned and operated by brothers-in-law Wasi Syed and Shahab Mir, and Darlene Row worked as a secretary.
Short and Welford negotiated with Syed and Row for the price and amount of polysilicon to be sold. During the course of negotiations, Syed flew to Pensacola, Florida, to see the polysilicon for himself. This meeting, in which Syed tested the polysilicon with a resistivity meter to check its purity level, occurred at night in a Krystal’s parking lot.
After testing the buckets of polysilicon, Syed agreed to buy the polysilicon from Short and Welford for a price well below the market value. One condition of the deal was that payments were to be made in cash and in person.
Between February 2009 and Marcy 2014, Short and Welford stole, and then subsequently sold, approximately 50 metric tons of Mitsubishi polysilicon rods to Horizon Silicon. Typically, Syed would find a buyer for the polysilicon he was purchasing from Short and Welford. Then Row would arrange for the polysilicon to be picked up and delivered to a port city on the west coast. Finally, Mir would fly or drive to Mobile, Alabama, and other locations along the Gulf Coast, with either backpacks or suitcases full of cash to pay Short and Welford.
The stolen polysilicon, which was valued at over $2.5 million, was exported from the United States after being sold by Syed to other buyers. While the final destination for all of the stolen polysilicon rods is not clear, at least some of the material ended up in the People’s Republic of China.
In early 2014, Short and Welford were caught by Mitsubishi. Syed, Mir, and Row were subsequently arrested in Texas in May 2014. In February 2015, Short and Welford each pled guilty to one count of conspiracy to possess, transport, buy, and sell stolen material in interstate commerce and to one count of conspiracy to commit money laundering. Row pled guilty to the same charges in March 2015, as did Syed and Mir on June 29, 2015.
This matter was investigated by Homeland Security Investigations and IRS-Criminal Investigations in Mobile, Alabama, with assistance from the Dallas, Texas office of these agencies. The case was prosecuted by Donna B. Dobbins and Christopher J. Bodnar, Assistant United States Attorneys with the U.S. Attorney’s Office for the Southern District of Alabama.
Volo, Illinois Woman Indicted for the Robbery and Attempted Robbery of Three Chase Bank BranchesRead the Press Release
ROCKFORD — A Lake County woman was indicted today in federal court and charged with two counts of bank robbery and one count of attempted bank robbery. TERESA M. KNOWLES, 39, of Volo, Ill., was charged with the robbery of Chase Bank, in Crystal Lake, Ill. on March 21, 2015, and Chase Bank, in Grayslake, Ill. on March 24, 2015, as well as the attempted robbery of Chase Bank in Johnsburg, Illinois, on March 24, 2015.
Knowles is scheduled to appear before U. S. Magistrate Judge Iain D. Johnson for an initial appearance on Thursday, July 2, 2015, at 11:00 a.m. in federal court in Rockford. Each count of bank robbery and attempted bank robbery carries a maximum potential penalty of up to 20 years in prison, up to 3 years of supervised release following imprisonment, a fine of up to $250,000, and full restitution. If convicted, the court must impose a reasonable sentence under federal sentencing statutes and the advisory United States Sentencing Guidelines.
The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
The indictment was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois, and Robert J. Holley, Special Agent-in-Charge of the Chicago Office of Federal Bureau of Investigation. The Johnsburg Police Department, McHenry Police Department, Grayslake Police Department, and Crystal Lake Police Department assisted in the investigation.
The government is represented by Assistant U.S. Attorney Michael D. Love.
Indictment
VMware and Carahsoft Agree to Pay $75.5 Million to Settle Claims that they Concealed Commercial Pricing and Overcharged the GovernmentRead the Press Release
ALEXANDRIA, Va. – VMware Inc. and Carahsoft Technology Corporation have agreed to pay $75.5 million to resolve allegations that they violated the False Claims Act by misrepresenting their commercial pricing practices and overcharging the government on VMware software products and related services.
VMware is a Delaware corporation that specializes in computer virtualization software and has its principal place of business in Palo Alto, California. Carahsoft is a privately held Maryland corporation that distributes information technology products to federal, state and local governments and has its principal place of business in Reston, Virginia.
“Transparency by contractors in the disclosure of their discounts and prices offered to commercial customers is critical in the award of GSA Multiple Award Schedule contracts and the prices charged to government agency purchasers,” said U.S. Attorney Dana J. Boente of the Eastern District of Virginia.
“Today’s settlement demonstrates our continuing vigilance to ensure that those doing business with the government give the taxpayers a fair deal,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Department of Justice’s Civil Division. “Government contractors who seek to profit improperly at the expense of taxpayers face serious consequences.”
“We will continue to look into all allegations of false claims in GSA contracts,” said Acting Inspector General Robert C. Erickson of the U.S. General Services Administration (GSA). “I appreciate the hard work of our auditors, our agents and the attorneys on this complex case that has resulted in a large amount of money being returned to the United States.”
Under the Multiple Award Schedule (MAS) Program, prospective vendors agree to disclose commercial pricing policies and practices to the GSA in exchange for the opportunity to gain access to the broad federal marketplace and the ease of administration that comes from selling to any government purchaser under one central contract. GSA regulations require that, during contract negotiations with GSA, prospective vendors seeking an MAS contract make “current, accurate and complete” disclosures of the standard and non-standard discounts they offer to commercial customers. The GSA relies on the accuracy of these disclosures in order to negotiate fair pricing for government purchasers. Additionally, after the MAS contract is awarded, regulations require that MAS Program vendors disclose to the GSA changes in their commercial pricing practices, including improved discounts that are offered to commercial customers, after the MAS contract is in place.
The settlement resolves allegations that VMware and Carahsoft made false statements to the government in connection with the sale of VMware products and services under Carahsoft’s MAS contract. These false statements allegedly concealed the companies’ commercial pricing practices and enabled the companies to overcharge the government for VMware’s products and services from 2007 through 2013.
The civil settlement resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and obtain a portion of the government’s recovery. The civil lawsuit was filed in the Eastern District of Virginia by Dane Smith, who is a former vice president of the Americas at VMware Inc. Mr. Smith’s share of the recovery has not been determined.
The settlement was the result of a coordinated effort by the U.S. Attorney’s Office of the Eastern District of Virginia, the Civil Division’s Commercial Litigation Branch, and the GSA’s Office of Inspector General, with assistance from the Defense Criminal Investigative Service Mid-Atlantic Field Office. This matter was investigated by Assistant U.S. Attorney Steve Gordon and Benjamin Wei of the Department of Justice.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 10-CV-769.
The claims resolved by the settlement are allegations only; there has been no determination of liability.
ALEXANDRIA, Va. – VMware Inc. and Carahsoft Technology Corporation have agreed to pay $75.5 million to resolve allegations that they violated the False Claims Act by misrepresenting their commercial pricing practices and overcharging the government on VMware software products and related services.
VMware is a Delaware corporation that specializes in computer virtualization software and has its principal place of business in Palo Alto, California. Carahsoft is a privately held Maryland corporation that distributes information technology products to federal, state and local governments and has its principal place of business in Reston, Virginia.
“Transparency by contractors in the disclosure of their discounts and prices offered to commercial customers is critical in the award of GSA Multiple Award Schedule contracts and the prices charged to government agency purchasers,” said U.S. Attorney Dana J. Boente of the Eastern District of Virginia.
“Today’s settlement demonstrates our continuing vigilance to ensure that those doing business with the government give the taxpayers a fair deal,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Department of Justice’s Civil Division. “Government contractors who seek to profit improperly at the expense of taxpayers face serious consequences.”
“We will continue to look into all allegations of false claims in GSA contracts,” said Acting Inspector General Robert C. Erickson of the U.S. General Services Administration (GSA). “I appreciate the hard work of our auditors, our agents and the attorneys on this complex case that has resulted in a large amount of money being returned to the United States.”
Under the Multiple Award Schedule (MAS) Program, prospective vendors agree to disclose commercial pricing policies and practices to the GSA in exchange for the opportunity to gain access to the broad federal marketplace and the ease of administration that comes from selling to any government purchaser under one central contract. GSA regulations require that, during contract negotiations with GSA, prospective vendors seeking an MAS contract make “current, accurate and complete” disclosures of the standard and non-standard discounts they offer to commercial customers. The GSA relies on the accuracy of these disclosures in order to negotiate fair pricing for government purchasers. Additionally, after the MAS contract is awarded, regulations require that MAS Program vendors disclose to the GSA changes in their commercial pricing practices, including improved discounts that are offered to commercial customers, after the MAS contract is in place.
The settlement resolves allegations that VMware and Carahsoft made false statements to the government in connection with the sale of VMware products and services under Carahsoft’s MAS contract. These false statements allegedly concealed the companies’ commercial pricing practices and enabled the companies to overcharge the government for VMware’s products and services from 2007 through 2013.
The civil settlement resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and obtain a portion of the government’s recovery. The civil lawsuit was filed in the Eastern District of Virginia by Dane Smith, who is a former vice president of the Americas at VMware Inc. Mr. Smith’s share of the recovery has not been determined.
The settlement was the result of a coordinated effort by the U.S. Attorney’s Office of the Eastern District of Virginia, the Civil Division’s Commercial Litigation Branch, and the GSA’s Office of Inspector General, with assistance from the Defense Criminal Investigative Service Mid-Atlantic Field Office. This matter was investigated by Assistant U.S. Attorney Steve Gordon and Benjamin Wei of the Department of Justice.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 10-CV-769.
The claims resolved by the settlement are allegations only; there has been no determination of liability.
VMWare and Carahsoft Agree to Pay $75.5 Million to Settle Claims that they Concealed Commercial Pricing and Overcharged the GovernmentRead the Press Release
VMware Inc. and Carahsoft Technology Corporation have agreed to pay $75.5 million to resolve allegations that they violated the False Claims Act by misrepresenting their commercial pricing practices and overcharging the government on VMware software products and related services, the Department of Justice announced today. VMware is a Delaware corporation that specializes in computer virtualization software and has its principal place of business in Palo Alto, California. Carahsoft is a privately held Maryland corporation that distributes information technology products to federal, state and local governments and has its principal place of business in Reston, Virginia.
“Today’s settlement demonstrates our continuing vigilance to ensure that those doing business with the government give the taxpayers a fair deal,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Department of Justice’s Civil Division. “Government contractors who seek to profit improperly at the expense of taxpayers face serious consequences.”
“Transparency by contractors in the disclosure of their discounts and prices offered to commercial customers is critical in the award of GSA Multiple Award Schedule contracts and the prices charged to government agency purchasers,” said U.S. Attorney Dana J. Boente of the Eastern District of Virginia.
“We will continue to look into all allegations of false claims in GSA contracts,” said Acting Inspector General Robert C. Erickson of the U.S. General Services Administration (GSA). “I appreciate the hard work of our auditors, our agents and the attorneys on this complex case that has resulted in a large amount of money being returned to the United States.” Under the Multiple Award Schedule (MAS) Program, prospective vendors agree to disclose commercial pricing policies and practices to the GSA in exchange for the opportunity to gain access to the broad federal marketplace and the ease of administration that comes from selling to any government purchaser under one central contract. GSA regulations require that, during contract negotiations with GSA, prospective vendors seeking an MAS contract make “current, accurate and complete” disclosures of the standard and non-standard discounts they offer to commercial customers. The GSA relies on the accuracy of these disclosures in order to negotiate fair pricing for government purchasers. Additionally, after the MAS contract is awarded, regulations require that MAS Program vendors disclose to the GSA changes in their commercial pricing practices, including improved discounts that are offered to commercial customers, after the MAS contract is in place.
The settlement resolves allegations that VMware and Carahsoft made false statements to the government in connection with the sale of VMware products and services under Carahsoft’s MAS contract. These false statements allegedly concealed the companies’ commercial pricing practices and enabled the companies to overcharge the government for VMware’s products and services from 2007 through 2013.
The civil settlement resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and obtain a portion of the government’s recovery. The civil lawsuit was filed in the Eastern District of Virginia by Dane Smith, who is a former vice president of the Americas at VMware Inc. Mr. Smith’s share of the recovery has not been determined.
The settlement was the result of a coordinated effort by the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office of the Eastern District of Virginia and the GSA’s Office of Inspector General, with assistance from the Defense Criminal Investigative Service Mid-Atlantic Field Office. The case is captioned United States ex rel. Smith v. VMware, Inc., et al., Case No. 10-CV-769 (E.D. Va.). The claims resolved by the settlement are allegations only; there has been no determination of liability.
United States Reaches Civil Settlement with Doctor and His Clinic for False Claims Submitted to Medicare and TRICARERead the Press Release
St. Louis, MO: The United States has reached a civil settlement with MOHAMMAD AKHTAR CHOUDHARY, M.D., and his company, ROLLA NEUROLOGY PAIN & SLEEP CENTER, LLC.
According to the allegations of the United States, Dr. Choudhary and his company, located in Rolla, Missouri, violated the False Claims Act by submitting false claims to Medicare and TRICARE by upcoding claims for payment by not accurately stating the level of services that was provided for evaluation and management of patients and for nerve conduction studies. As part of the civil settlement, the Defendants will pay the United States $861,571.
This settlement is part of ongoing efforts by the Department of Justice, the Department of Health and Human Services and the Defense Health Agency to recover funds diverted from Medicare and TRICARE. Assistant United States Attorney Suzanne Moore handled the case for the U.S. Attorney’s Office.
United States Attorney's Office recovers over twenty million dollars in case against Community Health NetworkRead the Press Release
Josh J. Minkler, United States Attorney, announced today a $20,324,902.22 civil settlement with Community Health Network (ACHN), a non-profit health system with more than 200 sites of care and affiliates throughout the State of Indiana. The settlement will resolve allegations that CHN submitted false claims to the Medicare and Medicaid programs.
"The civil False Claims Act was created to serve as a tool for combating fraud, waste and abuse in federally funded programs," Minkler stated. "This recovery sends the message that health care providers must comply with all applicable state and federal regulations when billing the United States Government for services, or they will face consequences." Under the False Claims Act, the Government may collect three times the loss it incurred, plus a fine of $5,500 to $11,000 for each false bill submitted.
This settlement is the result of an investigation conducted by the Department of Health and Human Services – Office of the Inspector General (“HHS-OIG”); the Federal Bureau of Investigation; and the State of Indiana Attorney General’s Office Medicaid Fraud Control Unit in coordination with the United States Attorney's Office and the United States Department of Justice in Washington, D.C.
Specifically, the United States alleges that since the late 1990s through October 2009, CHN had contracts with free-standing ambulatory surgery centers or “ASCs” not owned by CHN. Through these contracts, the ASCs would provide out-patient surgical services to CHN patients. CHN would then bill Medicare and Medicaid for the surgical services through the billing departments of its hospitals. When CHN presented the bill to the Medicare and Medicaid contractors, however, the billing information represented that the surgery was performed in the out-patient department of one of CHN’s hospitals, rather than in an ASC. Because the Medicare and Medicaid billing rates for surgeries performed in an ASC are generally lower than the billing rates for out-patient surgeries performed in a hospital, CHN received higher reimbursement from the Medicare and Medicaid programs than it was entitled. According to the United States, medical providers were specifically placed on notice by the Centers for Medicare and Medicaid Services (“CMS”) in late November 2007 that services provided in an ASC should only be billed at ASC rates, but CHN continued this practice until October 1, 2009.
According to Assistant United States Attorney Shelese Woods, who handled the case for the United States, CHN has also agreed to enter into a Corporate Integrity Agreement with HHS-OIG. “Our agency will continue to hold health care providers accountable for overbilling the Medicare and Medicaid programs,” said Special Agent in Charge Lamont Pugh III, U.S. Department of Health & Human Services, Office of Inspector General. “Our Corporate Integrity Agreement with CHN requires board of directors oversight as well as compliance mechanisms that are designed to help ensure that CHN submits appropriate claims to federal health care programs moving forward.”
The claims resolved by this settlement are allegations only and there has been no determination of liability. In investigating the case, HHS-OIG did not uncover any evidence of physical injury or harm to patients as a result of the alleged conduct.
Two Sentenced for Aiding Series of Bank and Business RobberiesRead the Press Release
SCRANTON – The United States Attorney's Office for the Middle District of Pennsylvania announced that Cindy Conden, age 29, of Hanover Township was sentenced today by U.S. District Court Senior Judge Richard P. Conaboy to 46 months’ imprisonment for aiding in the commission of multiple robberies.
Conden’s father, Charles Conden, age 48, also of Hanover Township, was sentenced by Judge Conaboy on June 23, 2015 to 84 months’ imprisonment. Both Cindy and Charles Conden pleaded guilty to the charges pursuant to plea agreements that were filed in February 2015.
According to United States Attorney Peter Smith, Jeffrey Townsley, age 43, Kingston, engaged in an 18-day crime spree beginning on December 24, 2013 and ending on January 10, 2014. The crimes included two bank robberies and seven robberies of local businesses. Townsley was arrested on January 10, 2014. He is currently serving a federal sentence of 151 months’ imprisonment imposed by Judge Conaboy on April 15, 2015.
Charles Conden aided Townsley in the robberies at Aldi’s Market in Kingston on January 7, 2014, Thomas’ Market in Larksville on January 8, 2014, and the Family Dollar in Ashley on January 10, 2014. Cindy Conden and James Hughes also aided Townsley in the commission of the Aldi’s robbery.
James Hughes, age 26, of Nanticoke, is scheduled to be sentenced on August 15, 2015. Hughes pleaded guilty pursuant to a plea agreement in May 2015 to aiding in the multiple robberies.
The investigation was conducted by the Federal Bureau of Investigation with the assistance of police departments of Kingston, Kingston Township, Larksville, Hanover Township, Wilkes-Barre, Plains, and Ashley, and the Luzerne County District Attorney Detectives. Prosecution is assigned to Assistant United States Attorney Michelle Olshefski.
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Two Memphis Men Sentenced to a Total of 260 Months for Robbing Whitehaven Dollar GeneralRead the Press Release
Memphis, TN – Two convicted felons responsible for robbing a Dollar General in Whitehaven have been collectively sentenced to 260 months in prison.
According to facts presented in court, on the evening of November 9, 2013, Johnnie Trenell, 31, and Maurice Harris, 22, entered the Dollar General located at 3909 Elvis Presley Blvd. armed with a Taurus 9mm pistol. Trenell jumped the counter and pointed the silver and black firearm at the cashier and demanded that the employee get on the floor. While Trenell occupied the cashier, Harris demanded another Dollar General employee to open the safe. Unable to do so, the second employee was then ordered to open the cash registers, remove the money in them and place it in a Dollar General bag.
After receiving a robbery in progress call at the Dollar General, Memphis Police Department officers arrived on the scene, according to court statements. Trenell and Harris fled to the back of the store after realizing law enforcement officers were outside the establishment. Shortly after entering the store, officers arrested both defendants and recovered the 9mm pistol they used, as well as $619 in a Dollar General bag. Officers were able to locate Harris’ vehicle, and recovered Harris’ fingerprints from items on the counter. One of the robbery victims also identified Trenell as the gunman.
On May 19th, District Court Judge S. Thomas Anderson sentenced Harris to 120 months in federal prison and three years of supervised release. Harris pled guilty to the Hobbs Act, a law that makes it a federal crime to commit a robbery that interferes with interstate commerce. Harris also pled guilty to being a felon in possession of a firearm.
Today, Trenell was sentenced to 140 months in federal prison and three years of supervised release by Judge Anderson. He also pled guilty to the Hobbs Act and being a felon in possession of a firearm.
This case was investigated by the FBI’s Memphis Safe Streets Task Force. Assistant U.S. Attorney Brian Coleman prosecuted the case on the government’s behalf.
Two Area Men Charged in Separate Federal Child Pornography IndictmentsRead the Press Release
ROCKFORD — Two area men were charged by a federal grand jury in separate cases on child pornography charges. ZACHARY RODRIGUEZ, 24, of Loves Park, Ill., was indicted on June 16, 2015, on one count of using a minor to engage in sexually explicit conduct in November 2014. Rodriguez appeared in federal court on June 23, 2015, and pled not guilty.
ADRIAN C. PETERS, 22, of South Beloit, Ill., was charged today with 12 counts of using a minor to engage in sexually explicit conduct for the purpose of transmitting a live visual depiction that would be transmitted and transported by a means or facility of interstate and foreign commerce, during the period of October 2012 to December 2014. Peters is scheduled to appear today at 3:00 p.m. before Magistrate Judge Iain D. Johnston.
Each count of sexual exploitation of a minor carries a potential penalty of a minimum of 15 years and a maximum of up to 30 years in prison, up to five years of supervised release following imprisonment, a fine of up to $250,000, and full restitution. If convicted, the court must impose a reasonable sentence under federal sentencing statutes and the advisory United States Sentencing Guidelines.
The public is reminded that an indictment contains only charges and is not evidence of guilt. Each defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
The indictments were announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois, and Robert J. Holley, Special Agent-in-Charge of the Chicago Office of Federal Bureau of Investigation. The Winnebago County Sheriff’s Office assisted in the investigations, along with the South Beloit Police Department in the charges against Peters, and the Loves Park Police Department in the charge against Rodriguez.
The government is represented by Assistant U.S. Attorney Michael D. Love.
Rodriguez Indictment
Peters IndictmentThree People Charged in Conspiracy to Sell Counterfeit Hair Care ProductsRead the Press Release
PHILADELPHIA – Three people were charged by information, filed or unsealed today, in a conspiracy to import and sell counterfeit goods, announced United States Attorney Zane David Memeger. Stephen Voudouris, Sr., 59, of Newtown Square, PA, Yung Chung, 31, of West Chester, PA, and Jaimmy Chun, 30, of Philadelphia, PA, are charged with conspiracy, trafficking in counterfeit goods and wire fraud. Voudouris, Sr. is also charged with smuggling counterfeit goods into the United States.
Stephen Voudouris, Sr. and Yung Chung were partners and owners of Misikko.com, headquartered in Newtown Square, Pennsylvania, an online retailer of luxury hair care appliances, including flat irons and blow dryers. Misikko.com was not an authorized dealer of brands such as CHI, T3 and Babyliss. According to the charging documents, in an effort to maximize profits, Voudouris, Sr., Chung and an employee, Chun, sought out Chinese manufacturing companies from which they could purchase cheap goods bearing counterfeit trademarks of CHI, T3 and Babyliss. It is further alleged that the defendants then resold the counterfeit goods as authentic, for top dollar, to the American public.
Allegedly at the direction of Voudouris, Sr., in a scheme to drive consumers to their website and maximize profits, Misikko.com also purported to sell "Breast Cancer Awareness" products. The Misikko.com website was designed to make consumers believe that breast cancer charities would benefit from the purchase of certain pink products. For some products, Misikko.com represented that $25 from every purchase would benefit a prominent breast cancer foundation. It is alleged, however, that no donations were ever made to a breast cancer charity.
If convicted of all charges, Stephen Voudouris, Sr. faces a potential advisory guideline sentencing range of 33 to 41 months in prison, a three-year period of supervised release, a fine of up to $1 million, and a $400 special assessment; Yung Chung and Jaimmy Chun each face a potential advisory sentencing guideline range of 24 to 30 months in prison, a three-year period of supervised release, a fine of up to $750,000, and a $300 special assessment. Each defendant is also responsible jointly and severally for full restitution of approximately $150,346.
The case was investigated by Homeland Security Investigations with the assistance of the Federal Reserve Board Office of the Inspector General. It is being prosecuted by Assistant United States Attorneys Alicia M. Freind and Mary E. Crawley.
An Information is an accusation. A defendant is presumed innocent unless and until proven guilty.
Thirty Year-Old Man Found Guilty of Transportation of an 8-10 Year-Old Minor with the Intent to Engage in Criminal Sexual ConductRead the Press Release
SAN JUAN, P.R. – After a four-day jury trial, Randy Charriez-Rolón was found guilty of two counts of transportation of a minor with intent to engage in Criminal Sexual Conduct and one count of possession of child pornography, announced United States Attorney Rosa Emilia Rodríguez-Vélez. Chief United States District Court Judge Aida Delgado-Colón presided over the trial.
According to the Superseding Indictment, the defendant transported a minor, identified as “John Doe,” to, among other places, a park near his school and to the parking lot of public swimming pool, both located in Toa Alta, Puerto Rico, where he sexually abused the minor inside his heavily tinted car.
During trial, the government presented evidence that Charriez-Rolón purchased numerous gifts for John Doe as an enticement for engaging in the illicit sexual conduct and also threatened to harm John Doe and his parents if he did not agree to continue engaging in such conduct.
“This case revealed the disturbing truth that some adults will go to great lengths to sexually exploit minors. The conviction of this predator showed the commitment of our state and federal law enforcement agencies to apprehend and prosecute criminals that victimize our children,” said United States Attorney for the District of Puerto Rico, Rosa Emilia Rodríguez-Vélez. “The U.S. Attorney’s Office for the District of Puerto Rico will continue to prosecute sexual predators in order to protect the vulnerable victims of these crimes, our children.”
The case was prosecuted by Assistant United States Attorney Marshal Morgan and Special Assistant United States Attorney Cristina Caraballo. The now convicted defendant faces a maximum penalty of up to life imprisonment. The sentencing is scheduled for October, 2015, and the defendant was remanded to the custody of the U.S. Marshals.
Third Individual Pleads Guilty to Investment FraudRead the Press Release
Ocala, Florida – United States Attorney A. Lee Bentley, III announces that Jenifer E. Hoffman (38, Clermont) has pleaded guilty to conspiracy to commit wire fraud and to making a false tax return. She faces up to 20 years in federal prison for the conspiracy charge and up to 3 years in federal prison for the false tax return charge. Hoffman has also agreed to pay more than $11.6 million in restitution to her victims. A sentencing date has not yet been set.
According to court documents, Hoffman and her two conspirators, John C. Boschert (43, Apopka) and Bryan T. Zuzga (37, Coldwater, Michigan), defrauded over 100 victims out of more than $11 million through investments offered in connection with a company called Assured Capital Consultants. As part of their solicitations, the conspirators represented to investors that money would be placed in a Performing Private Placement Investment, and that Boschert had connections to the trading program being used. Investors were told that their investments would be safe and that none of their money would leave the attorney escrow account that belonged to Zuzga, who was represented as being an attorney licensed in Florida. Investors were further advised that their funds would be used as collateral for a line of credit, which would then be used in trading.
None of those representations were true. Zuzga was not an attorney licensed in Florida or any other state, and the funds were not deposited into any escrow account controlled by him. Instead, the three operated a scheme in which money from later investors was paid to earlier investors. They also used some of the money from the scheme for themselves, including purchasing residences for Hoffman and Zuzga.
In a prior civil proceeding, the United States forfeited two residences belonging to Hoffman and Zuzga, which had been purchased with proceeds from the scheme. The United States obtained more than $850,000 from the sale of the properties. The proceeds from those sales were distributed to the victims of the scheme.
Boschert and Zuzga previously pleaded guilty to conspiracy to commit wire fraud. On June 23, 2015, Boschert was sentenced to nine years in federal prison. Zuzga’s sentencing date has not yet been set.
This case was investigated by the Internal Revenue Service – Criminal Investigation, the United States Secret Service, and the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorneys Roger B. Handberg, James Mandolfo, and Nicole M. Andrejko.
Texas Man Pleads Guilty to Federal Hate Crime for Assaulting an Elderly African-American ManRead the Press Release
A man from Katy, Texas, has entered a guilty plea to a federal hate crime related to the racially-motivated assault of an 81-year-old African-American man, announced Vanita Gupta, head of the Civil Rights Division, and U.S. Attorney Kenneth Magidson of the Southern District of Texas.
Conrad Alvin Barrett, 29, was charged with violating the Matthew Shepard and James Byrd Jr. Hate Crimes Prevention Act. On Nov. 24, 2013, he attacked the elderly African-American man because of the man’s race and color in what Barrett called a “knockout.”
At the hearing today, evidence revealed that Barrett recorded himself on his cell phone attacking the African-American man. In the recording, Barrett questions whether there would be national attention if he attacked a person of color. Barrett also claimed he would not hit “defenseless people” just moments before punching the elderly man in the face and with such force that the victim immediately fell to the ground. Barrett then laughed and said “knockout,” as he ran to his vehicle and fled. The victim suffered two jaw fractures and was hospitalized for several days as a result of the attack.
“This was a senseless and heinous act of violence that was committed simply because the victim was African American,” said Principal Deputy Assistant Attorney General Gupta. “The Department of Justice will continue to use every tool in our arsenal to vindicate the rights of victims of violent crimes.”
“The defendant’s admissions today resolve any question as to his guilt and are consistent with what we had planned to present at trial,” said U.S. Attorney Magidson. “We do not take criminal civil rights violations lightly and are now prepared to move forward at sentencing to fully advocate for the appropriate punishment in this case.”
The Matthew Shepard and James Byrd Jr. Hate Crimes Prevention Act was passed on Oct. 22, 2009, and signed into law by President Barack Obama six days later. Shepard was a gay student who was tortured and murdered in 1998 near Laramie, Wyoming. Byrd was an African-American man who was tied to a truck by two white supremacists, dragged behind it and decapitated in Jasper, Texas, in 1998.
U.S. District Judge Gray Miller of the Southern District of Texas accepted Barrett’s plea today and has set sentencing for September 18, 2015. At that time, he faces up to 10 years in federal prison and a $250,000 fine.
The charges are the result of an investigation conducted by the FBI in cooperation with the Fulshear, Texas, and Katy Police Departments as well as the Drug Enforcement Administration. Civil Rights Division Trial Attorneys Saeed Mody and Olimpia Michel are prosecuting the case along with Assistant U.S. Attorneys Ruben R. Perez and Joe Magliolo of the Southern District of Texas, in cooperation with District Attorney John Healey of Ft. Bend County, Texas.
Telemarketer Pleads Guilty Role in Multi-Million Dollar ScamRead the Press Release
Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today that Patrick A. Nosack, 34, of Henderson, Nevada, pled guilty in federal court this morning to conspiracy to commit mail and wire fraud in connection with telemarketing. Nosack faces maximum penalties of 25 years in federal prison, a $250,000 fine, five years of supervised release, and a $100 special assessment. Nosack is being held without bond pending his sentencing, which is set for Thursday, September 17, 2015.
The charge arose out of a telemarketing scam which operated in Las Vegas, Nevada, which bilked over 3,000 victims of approximately 10 million dollars. Consumers were victimized in all fifty states, the District of Columbia and Puerto Rico, all ten Canadian provinces and the Northwest Territory of Canada, as well as Australia, Israel and the United Kingdom. There were at least twelve victims in nine of the thirty-eight counties comprising the Southern District of Illinois. The scheme operated from December 5, 2006, until January 24, 2012.
Nosack was a telemarketer at a telemarketing company, called Vacation Max, which operated a timeshare resale scam. The company purported to be a Georgia corporation located in Delaware, but actually operated in Las Vegas, Nevada. The company falsely represented that they had found corporate buyers interested in acquiring blocks of timeshare units including the consumer's timeshare unit for purported business and tax purposes. The company solicited fees of up to several thousand dollars from each timeshare owner in purported pre-paid closing costs and related expenses. Like all such scams, none of the purported sales occurred and Vacation Max did not successfully sell any consumer’s timeshare interest except a relatively small number at fire sale prices.
This prosecution is one of nearly 100 timeshare resale fraud prosecutions brought in the Southern District of Illinois over the past four years. The case is part of an ongoing investigation by the St. Louis Field Office of the Chicago Division of the United States Postal Inspection Service. The prosecution of this case is being handled by Assistant United States Attorneys William E. Coonan and Michael Hallock.
Statement of U.S. Attorney Damon P. Martinez on Gaming at Pueblo of PojoaqueRead the Press Release
ALBUQUERQUE – U.S. Attorney Damon P. Martinez released the following statement on the expiration of the gaming compact between the Pueblo of Pojoaque and the State of New Mexico:
“The gaming compact between the Pueblo of Pojoaque and the State of New Mexico expires today, June 30, 2015. The inability of the Pueblo and the State to reach an agreement on terms for a new compact has resulted in a lawsuit, New Mexico v. U.S. Department of the Interior, et al., which is now pending in the U.S. Court of Appeals for the Tenth Circuit. The failure of the Pueblo and State to reach an agreement has also resulted in uncertainty as to what will happen to the Pueblo’s gaming facilities after today.
“I believe that the public interest is best served by maintaining the status quo while the appeal in the Tenth Circuit litigation is pending. I therefore have advised the Pueblo and the State that I will exercise my discretion not to bring an enforcement action against the Pueblo during the pendency of the appeal so long as the Pueblo continues to operate its gaming facilities in accord with the terms of its expiring compact to the extent feasible. The Pueblo has given its commitment to me that it will comply with this condition, and I have warned the Pueblo that any failure by the Pueblo to live up to this commitment during the pendency of the appeal may result in an enforcement action to shut down the Pueblo’s casino-style gambling operations. To ensure that I can meaningfully assess whether the Pueblo is complying with the terms of the expiring compact, the Pueblo has agreed to regularly provide me with detailed information that allows me to do so on a timely basis.
“Through the Tenth Circuit litigation, the State, the U.S. Department of the Interior and the Pueblo are each seeking to determine their respective rights and their authority to enter into lawful gaming compacts. I believe it is important to permit the parties to that litigation to receive the benefit of the Tenth Circuit’s ruling on the appeal, without the process being short-circuited by premature closure of the Pueblo’s casino gambling activities. My decision will (i) maintain the status quo to the extent feasible, (ii) protect the interests of all residents of the Pojoaque Valley, (iii) shield the other gaming tribes of New Mexico from unfair competitive disadvantage, and (iv) safeguard funds that would have gone to the State of New Mexico as revenue sharing had the current compact been extended.
“In making this decision, I am mindful of my responsibilities as the chief federal law enforcement official in New Mexico, which includes enforcement of federal Indian gaming laws. The Indian Gaming Regulatory Act, which is the principal law at issue, prohibits tribes from conducting casino-style gambling in the absence of a duly authorized compact. I recognize the effects that uncompacted gaming by the Pueblo could have on the State and on other tribes, both gaming and non-gaming. All other gaming tribes are making revenue sharing payments to the State, the size of which vary according to each tribe’s compact and the dollar amount of their ‘net win.’ Uncompacted gaming by Pojoaque Pueblo without continued revenue sharing to the State would put other gaming tribes at an unfair competitive disadvantage. On the other hand, I also recognize that premature cessation of Pojoaque Pueblo gaming could have detrimental impacts on state tourism, and on employment and services for the people of the Pojoaque Valley.
“Under the terms of the expiring compact, Pojoaque Pueblo was obliged to pay eight percent of its ‘net win’ as revenue sharing to the State of New Mexico. The 2015 form compact approved by the New Mexico legislature that has been accepted by several other gaming tribes provides for this rate to rise as high as ten percent in 2018. Representatives of the State have advised me that they cannot accept payment of revenue sharing funds from Pojoaque Pueblo on gaming proceeds obtained after June 30 in the absence of a valid compact. In keeping with my decision to maintain the status quo during the pendency of the appeal to the extent feasible, the competitive disadvantage at which other gaming tribes would be placed if Pojoaque Pueblo were to conduct casino-style gaming without making revenue sharing payments will be mitigated by the Pueblo’s commitment to set aside the funds that would have gone to revenue sharing for eventual distribution pursuant to a negotiated compact or other appropriate court action after resolution of the appeal. The funds will be deposited into an account overseen by an independent trustee. Here too, the Pueblo has committed to regularly providing me with detailed information that will allow me to verify that the Pueblo is complying with its promise to safeguard the revenue sharing funds that would have gone to the State.
“Among the safeguards that were written into the expiring compact between the Pueblo and the State were requirements that the Pueblo maintain a tribal gaming agency to provide for the physical safety of patrons and of personnel of gaming enterprises; to provide for protection of property of patrons and the gaming enterprise from illegal activity; and to detain persons who may be involved in illegal acts for the purpose of notifying law enforcement authorities. The Pueblo has committed to continued compliance with these terms during the pendency of the Tenth Circuit appeal. Likewise, the Pueblo has committed to continued compliance with the other terms of the expiring compact, including but not limited to prohibition on casino-style gambling by persons under the age of 21, and prohibition on employment of gaming employees who are under the age of 21 or who are not licensed in accordance with federal and tribal law. The Pueblo has also committed to continued compliance with the terms of the expiring compact pertaining to fair gaming practices, including but not limited to posting the odds of a winning outcome on each machine; ensuring minimum payouts of at least 80 percent; maintaining current limitations on alcohol sales; and prohibiting acceptance of IOUs from patrons.
“I have advised the Pueblo that it is up to me to determine whether or not the Pueblo has complied with its commitments, and that I reserve the right to seek closure of the Pueblo’s casino gambling operations in the event of any noncompliance. Moreover, my decision not to bring an immediate enforcement action upon expiration of Pojoaque Pueblo’s current compact only extends to the limited period of time until the Tenth Circuit Court of Appeals rules on the pending litigation.”
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South Sioux City Man Sentenced to 235 months in Prison on Methamphetamine and Firearm ChargesRead the Press Release
United States Attorney Deborah R. Gilg announced that Jacob W. Deng, 33, was sentenced on June 29, 2015, to 235 months in prison after a jury trial resulted in guilty verdicts on charges of Conspiracy to Distribute Methamphetamine, Distribution of Methamphetamine, Possession with Intent to Distribute Methamphetamine and Marijuana, and Felon in Possession of a Firearm. On April 3, 2015, Deng was found guilty of all charges after a two and a half day jury trial before the Honorable Laurie Smith Camp, United States District Judge.
The evidence presented at trial revealed that on April 17, 2014, South Sioux City DEA Task Force Officers executed a search warrant on Deng’s South Sioux City apartment and discovered approximately two ounces of crystal methamphetamine, multiple ounces of marijuana, drug packaging materials, over $7,000 in cash, and two firearms. Prior to the execution of the search warrant, Deng delivered methamphetamine to a cooperating witness while inside his apartment. At the time of the delivery Deng had a prior felony conviction for delivery of a controlled substance.
This case was the result of an investigation by the South Sioux City Police Department and DEA Tri-State Drug Task Force.
Serial Bank Robber Pleads GuiltyRead the Press Release
MEDFORD, Ore. - On Monday, June 29, 2015, Bradley William Monical pled guilty to bank robbery and weapons charges related to a string of armed bank robberies he committed in 2010. Monical pled guilty to three armed bank robberies that occurred in Medford, Klamath Falls and Redmond, Oregon. He also pled guilty to using a firearm in connection with a violent crime based on his use of a handgun in the Medford and Klamath Falls robberies. Monical also pled guilty to three armed bank robberies that occurred in Washington and an additional bank robbery that occurred in Idaho.
Monical was in custody on pending bank robbery charges when he escaped from the Jackson County Jail on November 19, 2012. Monical was later found in Oregon City and was arrested by the United States Marshals. At the time of his arrest, he was found with his girlfriend, Carolyn Gibson. Gibson pled guilty to concealing a person from arrest for providing money and a vehicle for Monical after his escape. Gibson was sentenced to probation on February 2, 2015.
Monical is scheduled to be sentenced on September 23, 2015, before the Honorable Michael McShane.
This case was investigated by the Medford Police Department, the Jackson County Sheriff’s Office, the FBI, and the United States Marshals Service, and was prosecuted by Assistant U.S. Attorney Judith R. Harper.
Second Circuit Affirms Apple's Liability for per Se Unlawful E-Book Price-Fixing ConspiracyRead the Press Release
Assistant Attorney General Bill Baer of the Justice Department’s Antitrust Division released the following statement today after the U.S. Court of Appeals for the Second Circuit ruling in United States v. Apple Inc.:
“We are gratified by the court’s decision. The decision confirms that it is unlawful for a company to knowingly participate in a price-fixing conspiracy, whatever its specific role in the conspiracy or reason for joining it. Because Apple and the defendant publishers sought to eliminate price competition in the sale of e-books, consumers were forced to pay higher prices for many e-book titles.
“I am proud of the outstanding work done by the trial team who initially established Apple’s liability and by the lawyers who defended the district court’s decision in this appeal. The Antitrust Division will continue to vigorously protect competition and enforce the antitrust laws in this important business, and in other industries that affect the everyday lives of consumers.”
Background
On April 11, 2012, the department filed a civil antitrust lawsuit in the U.S. District Court for the Southern District of New York against Apple, Hachette Book Group (USA), HarperCollins Publishers L.L.C., Holtzbrinck Publishers LLC (which does business as Macmillan), Penguin Group (USA) Inc. and Simon & Schuster Inc. for conspiring to end e-book retailers’ freedom to compete on price by taking control of pricing from e-book retailers and substantially increasing the prices that consumers paid for e-books.
At the same time that it filed the lawsuit, which was consolidated with suits brought by 33 states and territories, the department reached settlements with three of the publishers – Hachette, HarperCollins and Simon & Schuster. Those settlements were approved by the court in September 2012. The department settled with Penguin on Dec. 18, 2012, and with Macmillan on Feb. 8, 2013. The Penguin settlement was approved by the court in May 2013 and the Macmillan settlement was approved in August 2013. Under the settlements, each publisher was required (a) to terminate agreements that prevented e-book retailers from lowering the prices at which they sell e-books to consumers and (b) to allow for retail price competition in renegotiated e-book distribution agreements.
The department’s trial against Apple, which was overseen by U.S. District Judge Denise L. Cote of the Southern District of New York, began on June 3, 2013. The trial lasted for three weeks, with closing arguments taking place on June 20, 2013. Judge Cote issued her opinion and order on July 10, 2013, finding Apple liable for knowingly participating in and facilitating a conspiracy with the publishers. On Sept. 5, 2013, Judge Cote entered a final judgment prohibiting Apple from immediately reestablishing e-book distribution agreements with the defendant publishers similar to the agreements that were established through the conspiracy and from entering e-book distribution agreements containing most-favored-nations provisions; requiring Apple to adopt a rigorous antitrust compliance program; and imposing an external compliance monitor to evaluate and recommend improvements to Apple’s antitrust compliance and training programs.
Salem Man Sentenced for Role in Methamphetamine CaseRead the Press Release
Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today that Walter James Henson, 38, of Salem, Illinois, was sentenced today to 151 months in federal prison, to be followed by 3 years’ supervised release, a $500 fine and a $200 special assessment. Sentencing followed Henson’s guilty plea in March 2014 to both charges against him in an indictment returned by a Federal Grand Jury in November 2014. The offenses relate to the manufacture of methamphetamine and both occurred in Marion County, Illinois, on March 5, 2014, at a time when Henson was a parole absconder from the Illinois Department of Corrections. Specifically, Henson was sentenced for Possession of Equipment, Chemicals, Products and Materials with Intent to Manufacture Methamphetamine (Count 1), and Possession of a Listed Chemical (Pseudoephedrine) Knowing It Would Be Used to Manufacture Methamphetamine (Count 2).
Information leading to the charges against Henson was obtained in an investigation conducted by the FBI, the Marion County Sheriff’s Office, and the Clinton County Sheriff’s Department, assisted by the Illinois State Police Methamphetamine Response Team. The case is being handled by Assistant United States Attorney Kit Morrissey.
Repeat Sex Offender who Preyed on Youth via Online Computer Games Sentenced to 15 Years in PrisonRead the Press Release
A 35-year-old Kirkland, Washington man was sentenced Monday, June 29, 2015 in U.S. District Court in Seattle to 15 years in prison for receipt and possession of child pornography, announced U.S. Attorney Annette L. Hayes. ANDREW MICHAEL HARTUNG was contacted by law enforcement after a parent in Colorado reported that someone his son had met through online games asked the teen for sexually explicit pictures. While playing the online games “League of Legends” and “Minecraft,” HARTUNG represented himself as a teen-ager. Further investigation revealed HARTUNG had convinced other young teens to send him sexually explicit photos. In 2002, HARTUNG was convicted of possession of child pornography while a student in Pullman, Washington. U.S. District Judge James L. Robart imposed the mandatory minimum 15-year sentence for offenders with a prior conviction for a child sex offense, and ordered HARTUNG to be on lifetime supervised release following the prison sentence.
“This convicted sex offender patronized online gaming sites predominately frequented by minors,” said U.S. Attorney Annette L. Hayes. “He spent years cultivating relationships with malleable young teens, grooming them and plying them with misinformation about his age, identity, and most importantly his intentions. This case serves as a reminder to parents to be engaged in their children’s online lives.”
According to records filed in the case, HARTUNG cultivated relationships with at least three teen-age boys online over years of playing video games. HARTUNG convinced the teens he was also a teen-ager and sent the teens gift cards, online game points and gifts. HARTUNG contacted the teens via text message, SKYPE, and FaceTime. In one instance HARTUNG traveled to the victim’s state (Arizona) to provide him with a laptop computer. Messages recovered from HARTUNG’s and the victim’s media devices reveal HARTUNG was trading gifts, game items and money for sexually explicit images of the victims. Before law enforcement executed a search warrant in April 2014, HARTUNG had been planning to travel to Colorado to contact the victims.
The case was investigated by the Arapahoe County Sheriff’s Office in Colorado, the Kirkland Police Department, and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI). The case was prosecuted by Special Assistant United States Attorney Cecelia Gregson. Ms. Gregson is a Senior Deputy Prosecuting Attorney for the King County Prosecutor’s Office specially designated to prosecute child exploitation cases in federal court.
Pennsylvania Contractors Sentenced for Roles in Employee Extortion Scheme, Vehicular Assault of A Site Manager and Paying Bribes to Get Federal ContractsRead the Press Release
CAMDEN, N.J. – Two principals of a Pennsylvania construction company working on a project at the Ft. Dix military base in Burlington County, New Jersey, were sentenced today for separate charges concerning employee extortion, the hired assault of a site manager and bribes to secure federally subsidized construction projects, U.S. Attorney Paul J. Fishman announced.
Leonard Santos, 68, of Yardley, Pennsylvania, owner of Sands Mechanical Inc. of Bristol, Pennsylvania, was sentenced to 85 months in prison. Santos previously pleaded guilty before U.S. District Judge Joseph H. Rodriguez to Count One of an indictment charging him with conspiracy to obtain kickbacks from public works employees and Count Three, charging him with causing persons to travel in interstate commerce to commit a crime of violence.
Alex Rabinovich, 59, of Richboro, Pennsylvania, Sands Mechanical’s general manager, was sentenced to three years’ probation, including four months of home confinement. Rabinovich previously pleaded guilty before Judge Rodriguez to Count Four of the indictment, which charged a conspiracy to make payoffs to a contractor’s representative for receiving favorable treatment when bidding on federal construction projects. Judge Rodriguez imposed both sentences today in Camden federal court.
According to documents filed in this case and statements made in court:
Between November 2009 and September 2010, Santos operated Sands Mechanical Inc. as a subcontractor on the restoration and rehabilitation of the Marine Corps Reserve Training Center at Joint Base-McGuire-Dix-Lakehurst in Burlington County. Sands provided HVAC and plumbing services. The general contractor was a company headquartered in Marriotsville, Maryland. In order to increase the profitability of the project, Santos, with the aid of his son-in-law Richard Cottone, 40, of Windsor, Pennsylvania, and Michael Featherston, 45, of Bridgeton, New Jersey, demanded that certain employees kickback a percentage of their weekly paychecks or face termination.
In February 2010, the U.S. Department of Labor’s Wage and Hour Division (WHD) was tipped off that the Sands employees were being forced to kickback portions of their salary and were not being paid the prevailing wage for Burlington County. Santos conceded that Sands failed to pay the proper prevailing wage to its employees and agreed to repay $80,000 to those deprived employees. Santos cut settlement checks to those employees who were owed back wages. However, Cottone and Featherston warned those employees not to cash their settlement checks. Instead, Cottone and Featherston took the employees to a nearby check cashing business, where they endorsed their checks over to Cottone, who cashed them and returned the funds to Santos.
In addition, the general contractor’s site manager was routinely critical of the work performance of Sands’ employees, which, at times, necessitated that work be done over. As a result, the site manager was targeted by Santos, Cottone and others by having his truck torched in front of his residence at 4 a.m. on May 17, 2010. This tactic failed to warn off the site manager. Santos admitted that he later condoned physically incapacitating the site manager so that he could no longer supervise the work site and offered $5,000 to whomever Cottone recruited to carry out the attack. On June 10, 2010, an assailant recruited by Cottone opted instead to hit the site manager with his car and called Cottone for permission to carry out the deed. After Cottone gave the “go-ahead” the assailant and two friends ran down the site manager while he was riding his bike. The victim sustained multiple serious injuries.
Also, from November 2009 through January 2013, Rabinovich and others paid a Philadelphia contractor’s representative to get “last looks” at other competitors’ bids for federally subsidized projects. This allowed Sands Mechanical to successfully underbid other subcontractors. A total of $46,200 in bribes/kickbacks was owed for 10 subcontracts awarded to Sands Mechanical. By the summer of 2012, approximately $15,000 was still outstanding for the last two contracts. On two occasions, in November and December 2012, Rabinovich was caught on videotape giving a total of $4,156 in cash to the contractor’s representative to pay down the amounts still due and owing.
In addition to the prison term, Judge Rodriguez ordered Santos to serve three years of supervised release and pay restitution of $10,000.
Cottone and Featherston have both pleaded guilty to their roles in the scheme and were sentenced to 33 months and 12 months in prison, respectively.
U.S. Attorney Fishman credited special agents of the U.S. Department of Labor Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, under the direction of Special Agent in Charge Cheryl Garcia; the Department of Labor-Wage and Hour Division, under the direction of Acting Regional Administrator Mark Watson Jr.; the Naval Criminal Investigative Service, under the direction of Special Agent in Charge Leo S. Lamont, Northeast field office; and the Air Force Office of Special Investigations, under the direction of Special Agent Seth Neville, detachment commander, Joint Base McGuire-Dix-Lakehurst.
The government is represented by Senior Litigation Counsel V. Grady O’Malley and Assistant U.S. Attorney Andrew Bruck of the U.S. Attorney’s Office Organized Crime-Gangs Unit in Newark.
Defense counsel: Guillermo R. Arango Jr. Esq., New Brunswick, New Jersey
Passadumkeag Man Sentenced to One Year for Receiving a Firearm While Under IndictmentRead the Press Release
Contact: Chris Ruge
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Winston Dale Cronkhite II, 32, of Passadumkeag, Maine, was sentenced today in U.S. District Court by Judge John A. Woodcock Jr. to one year and a day in prison and three years of supervised release for receiving a firearm while under indictment. Cronkhite pleaded guilty to the charge on March 6, 2015.
According to court records, on October 5, 2014, following a domestic dispute with his girlfriend, Cronkhite was pulled over by the Maine State Police. At the time he was stopped, Cronkhite had a 12-gauge shotgun and five shells on the passenger’s seat of his truck. The shotgun had been manufactured in March of 2014. Cronkhite was prohibited from receiving firearms because he was then under indictment in Indiana for felony battery resulting in serious bodily injury.
The investigation was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Maine State Police; and the Penobscot District Attorney’s Office.
Pair Sentenced in Counterfeit Spending Spree in Broward and Palm Beach CountiesRead the Press Release
Two Palm Beach County residents were sentenced today to possessing and using counterfeit currency.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, Neil Melofchik, Acting Special Agent in Charge, U.S. Secret Service (USSS), Miami Field Office, William R. Latchford, Chief, Seminole Police Department, and Stephen J. Stepp, Chief, Palm Beach Gardens Police Department, made the announcement.
Bernardo Lecaros, 35, of Delray Beach, was sentenced by U.S. District Judge Robin Rosenberg to 27 months imprisonment, to be followed by two years of supervised release upon release, and was also ordered to pay $5,400 in restitution. Co-defendant Mariana Cordova Ortiz, 23, of West Palm Beach, was sentenced to 8 months imprisonment, to be followed by a year of supervised release. Both Lecaros and Ortiz previously pled guilty to passing counterfeit currency, in violation of Title 18, United States Code, Section 472. Lecaros also pled guilty to conspiracy to pass and possess counterfeit currency, in violation of Title 18, United States Code, Section 371.
According to public records and information presented in court, on December 10, 2014 and December 14, 2014, Lecaros passed $5,400 in counterfeit currency at the Seminole Classic Casino in Hollywood, Florida. Lecaros also possessed an additional $37,800 in counterfeit currency. On December 20, 2014, Lecaros was arrested by the Seminole Police Department and the USSS in connection with his use of counterfeit money at the casino.
In a separate incident, according to public records and information presented in court, Lecaros and Ortiz were arrested on March 3, 2015 by the USSS and the Palm Beach Gardens Police Department after Lecaros used $300 in counterfeit currency to purchase merchandise at a luxury department store inside the Palm Beach Gardens Mall, and possessed an additional $31,500 in counterfeit currency that day. Lecaros and Ortiz had entered the mall together that day, and Ortiz used $700 in counterfeit currency to purchase luxury goods.
Mr. Ferrer commended the investigative efforts of the USSS, the Seminole Police Department and the Palm Beach Gardens Police Department. The case is being prosecuted by Assistant U.S. Attorneys Lauren Jorgensen and Randy Katz.
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.
Owners of Chinese Restaurants in Rio Rancho and Santa Fe Sentenced to Probation for Harboring Illegal Aliens and Violating Minimum and Overtime Wage LawsRead the Press Release
ALBUQUERQUE – Wen Ping Chen, 30, of Rio Rancho, N.M., and his brother Wen Qiu Chen, 31, of Santa Fe, N.M., were each sentenced this afternoon to two years of probation for harboring illegal aliens and violating the federal minimum and overtime wage laws. Ping Chen and Qui Chen were also ordered to forfeit a residence located on Aztec Court in Rio Rancho that was used to facilitate the Chens’ criminal conduct. Although the amount of restitution to be paid by the Chen brothers will be determined at a later date, the court noted that the restitution order would be no less than $120,000.
Ping Chen and Qiu Chen, both naturalized U.S. Citizens born in China, were arrested in Aug. 2013, following an investigation into allegations that they were harboring illegal aliens who worked at their restaurants, the Double Dragon Restaurant in Rio Rancho., which is owned and operated by Ping Chen, and the Double Dragon II, in Santa Fe, which is owned and operated by Qiu Chen. The brothers subsequently were charged in a seven-count superseding indictment alleging conspiracy, alien harboring, and failing to pay minimum and overtime wages.
According to court filings, in Oct. 2012, federal agents executed search warrants at the Double Dragon and a Rio Rancho residence owned by Ping Chen and Qiu Chen. The agents found three illegal aliens at the Double Dragon and another illegal alien at the residence, which served as the residence for all four aliens. All four illegal aliens worked for Ping Chen at the Double Dragon without authorization.
In May 2013, federal agents executed search warrants at the Double Dragon II and a Santa Fe residence owned by Qiu Chen, and found five illegal aliens at the Double Dragon II. The agents learned that all of the Double Dragon II employees resided in the Santa Fe residence owned by Qiu Chen. The five illegal aliens worked for Qiu Chen at the Double Dragon II without authorization.
On Dec. 12, 2014, Qui Chen pled guilty to Counts 5 and 7 of the superseding indictment charging him with harboring an illegal alien and failing to pay minimum and overtime wages. Ping Chen pled guilty to Counts 3 and 7 charging him with harboring an illegal aliens and failure to pay minimum and overtime wages.
This case was investigated by the Albuquerque office of HSI and the U.S. Department of Labor, and is being prosecuted by Assistant U.S. Attorneys Norman Cairns and Raquel Ruiz-Velez.
Owner of North Jersey High-End Car Dealership Charged with Fraudulently Obtaining $1.7 Million in LoansRead the Press Release
NEWARK, N.J. - A Newark federal grand jury returned an indictment today charging the owner of a Ramsey, New Jersey, car dealership with defrauding customers and banks out of $1.7 million, U.S. Attorney Paul Fishman announced.
Afzal Khan, a/k/a “Bobby Khan,” 32, of Egg Harbor Township, New Jersey, is charged with five counts of wire fraud. Khan, who was initially charged by complaint on Dec. 23, 2014, is still at large.
According to the indictment filed today:
From December 2013 through September 2014, Khan, through his car dealership,
Emporio Motor Group of Ramsey, engaged in a number of fraudulent transactions involving Rolls Royce, Lamborghini, Porsche and other vehicles. As part of his scheme, Khan obtained loans from the auto finance division of a large bank for cars that he never delivered, but for which the purchaser was still responsible. Khan also obtained loans for cars that neither he nor Emporio had the title. As a result, the purchasers of these cars were still liable for the loan, but could not register them. In addition, Khan offered to sell cars for individuals on consignment but thereafter did not return the cars or provide any money to the purchaser from the sale.
Altogether, Kahn fraudulently obtained 21 loans totaling more than $1.7 million.
Each count of wire fraud is punishable by a maximum potential penalty of 20 years in prison and a fine of $250,000, or twice the gross gain or loss from the offense.
U.S. Attorney Fishman credited law enforcement officers of the FBI under the direction of Special Agent in Charge Richard M. Frankel in Newark; the Bergen County Prosecutor’s Office under the direction of Prosecutor John L. Molinelli; and the Borough of Ramsey Police Department under the direction of Chief of Police Bryan H. Gurney, with the investigation leading to the charges.
The government is represented by Assistant U.S. Attorney Andrew Kogan of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
Owner of Long Island Advertising Business Pleads Guilty to Multi-Million Dollar Mail Fraud SchemeRead the Press Release
Earlier today, Matthew Rosencrans was arraigned on a felony information and pled guilty at the federal courthouse in Central Islip, New York, to committing a multi-million dollar mail fraud scheme in connection with his ownership and operation of Community Coupons, an advertising business located in Glen Cove, New York.
The charge and plea were announced by Kelly T. Currie, Acting United States Attorney for the Eastern District of New York, and Philip R. Bartlett, Postal Inspector in Charge, New York Division, U.S. Postal Inspection Service.
Community Coupons printed coupon booklets and flyers that advertised for a fee its customers’ special promotions and discounted services and mailed those materials through the United States Postal Service at a discounted bulk mail rate via a permit. From approximately July 2010 to August 2013, Rosencrans conducted a scheme to defraud the Postal Service by submitting over 15 million pieces of bulk mail for distribution throughout the New York metropolitan area, although he only paid for delivery of approximately 3.4 million pieces of bulk mail. The fraud deprived the Postal Service of over $2,000,000 in payments that should have been paid by Community Coupons.
“In these financially difficult times for the Postal Service, the defendant failed to pay millions of dollars owed for services rendered,” stated Acting United States Attorney Currie. “Although he was in the business of providing his customers’ discounted services to consumers, Rosencrans cannot discount the law for his own financial gain.” Postal Inspector in Charge Bartlett stated, “A theft from the Postal Service is a theft from the American Public. Postal Inspectors will vigorously pursue and bring to justice anyone who cheats the Postal Service of revenue.”
Today’s plea took place before United States District Judge Joanna Seybert. When sentenced, Rosencrans faces up to 20 years in prison, as well as criminal forfeiture and restitution payable to the United States Postal Service in the amount of $2,101,278.33.
The government’s case is being handled by the Office’s Long Island Criminal Division. Assistant United States Attorney Charles N. Rose is in charge of the prosecution.
The Defendant:
MATTHEW ROSENCRANS
Age: 50
Glen Cove, New York
E.D.N.Y. Docket No. 15-CR-315 (JS)
Oregon Resident Charged with Planting a Fake Bomb on AirplaneRead the Press Release
PORTLAND, Ore, – Sean Michael Davies, 22, a U.S. Citizen residing in Warrenton, Oregon, was arrested this morning after he surrendered to agents of the FBI in connection with charges involving the planting of a fake bomb on a Dutch airliner. Davies is charged in a two-count indictment with making a false report of a destructive device which could damage or destroy an aircraft, and conveying false information about a destructive device which could damage or destroy an aircraft. Both charges carry a maximum penalty of five years in prison and a $250,000 fine.
According to the indictment, on October 20, 2014, Davies was travelling on Flight 569 operated by KLM Royal Dutch Airlines between Amsterdam, Netherlands, and Kilimanjaro and Dar Es Salaam, Tanzania. Davies allegedly constructed what appeared to be a possible bomb or destructive device, hid it in the restroom of the aircraft, and then falsely reported to the flight crew that he had discovered the device, causing KLM Flight 569 to be diverted to Cairo, Egypt.
Davies appeared today before United States Magistrate John Acosta who set the trial on the charges for September 1, 2015, before United States District Judge Michael W. Mosman. Davies is charged in the District of Oregon, as he is a U.S. citizen and a resident of Oregon.
This case was investigated by the FBI with the assistance of authorities in the Netherlands. The prosecution is being handled by Assistant U.S. Attorney Charles F. Gorder, Jr. from the U.S. Attorney’s Office in the Portland, Oregon.
An indictment is only an allegation and not evidence of guilt. Davies is presumed innocent unless and until proven guilty in court.
Omaha Woman Sentenced to 15 Years in Prison for Conspiring to Distribute Methamphetamine while in Possession of a FirearmRead the Press Release
United States Attorney Deborah R. Gilg announced that Amber Alvord, 36, of Omaha, Nebraska, was sentenced on June 29, 2015, to 15 years in prison by United States District Judge Laurie Smith Camp. Alvord had previously pled guilty to Conspiracy to Distribute more than 50 grams of Methamphetamine and Possessing a firearm in Relation to a Drug Trafficking Crime. Alvord was arrested and indicted on the charges after Omaha police officers twice executed search warrants on the same South Omaha residence in April of 2014. In total, officers seized more than three ounces of methamphetamine, three handguns, over $4,000 in currency, and drug paraphernalia.
As a result of possessing more than 50 grams of actual methamphetamine along with a firearm, Alvord faced a mandatory minimum sentence of 15 years. After serving her sentence Alvord will be required to serve a Term of Supervised Release of 5 years.
This case was the result of an investigation by the Omaha Police Department and Sarpy County Sheriff’s Office.
New Hampshire Man Pleads Guilty to Three Counts of Robbery from November 2014 Crime SpreeRead the Press Release
CONCORD, NEW HAMPSHIRE: Donald Feith, Acting United States Attorney for the District of New Hampshire, announced that James Whinnem, 34, formerly of Manchester, pleaded guilty before United States District Judge Landya B. McCafferty in Concord to a three count information charging him with one count of robbery affecting interstate commerce in violation of Title 18, United States Code, Section 1951, and two counts of bank robbery in violation of Title 18, United States Code, Section 2113(a).
According to court documents and statements made in court, Whinnem robbed a gas station convenience store at knife point in Manchester, New Hampshire on November 16, 2014. Two days later, while apparently unarmed, Whinnem robbed a bank in Manchester by passing a demand note to the teller. Two days after that, he robbed another bank, this time in Dover, also while unarmed and by passing a demand note to the teller. Following the wide-spread publication of bank video surveillance footage on local New Hampshire news, authorities identified Whinnem from multiple sources. New Hampshire State Police located and arrested Whinnem on November 30, 2014 in the area of Claremont, NH. He has remained in custody on a New Hampshire state parole violation since that date.
Whinnem is scheduled to be sentenced by Judge McCafferty on October 6, 2015 at 2:00 p.m., at which time he faces a maximum term of imprisonment of twenty years on each count of conviction, up to three years’ supervised release, and an order of restitution.
This matter is being investigated by the Federal Bureau of Investigation, the Manchester Police Department, and the Dover Police Department. The case is being prosecuted by Assistant United States Attorney Charles L. Rombeau.
Nashville Man Pleads Guilty to Armed Bank RobberyRead the Press Release
Kershawn Globe, aka Memphis, 36, of Nashville, Tenn., pleaded guilty yesterday to armed bank robbery and use of a firearm during a federal crime of violence, announced David Rivera, United States Attorney for the Middle District of Tennessee. Globe robbed the 5/3 Bank on East Thompson Lane in Nashville, Tenn. on August 2, 2014.
According to the statement of facts, Globe robbed the bank of $6,511.00 at gunpoint, then escaped from police, carjacked a minivan, and eventually met up with his sister, who drove him away. Globe was captured on August 7, 2014, in Memphis, Tennessee.
Under the terms of his plea agreement with the government, Globe will serve 18 years for the bank robbery, followed by seven additional years for the firearm charge, for a combined total of 25 years in prison. There is no parole in the federal system.
Globe’s sentencing is set for October 30, 2015, before United States District Judge Kevin Sharp.
This case was investigated by the FBI Violent Crime Task Force and the Metropolitan Nashville Police Department. Assistant U.S. Attorney Lee Deneke prosecuted the case.
Monroe woman sentenced to 12 months in prison for stealing more than $135,000 in social security fundsRead the Press Release
MONROE, La. – United States Attorney Stephanie A. Finley announced that a Monroe woman was sentenced Monday to 12 months in prison for illegally taking more than $135,000 in Social Security payments that were for her mother who had died.
Rhonda Eiland, 51, of Monroe, was sentenced by U.S. District Judge Robert G. James on one count of theft of government property. She was also ordered to serve three years of supervised release and pay $135,740 restitution. According to the March 5, 2015 guilty plea, Eiland started receiving Social Security Administration payments on her mother’s behalf in 1999. Eiland’s mother died in March of 2002, and Eiland failed to notify the Social Security Administration. The payments continued until April of 2014. Additionally, Eiland completed Social Security paperwork stating that her mother was alive in order to continue receiving payments. She received $135,740 that she was not entitled to.
The Social Security Administration investigated the case. Assistant U.S. Attorney F. Michael O’Mara prosecuted the case.
Missouri and Arkansas Physician Convicted of Online Sexual Enticement of a ChildRead the Press Release
Fort Smith, Arkansas - Conner Eldridge, United States Attorney for the Western District of Arkansas, announced that Donald Wayne Lamoureaux, age 68, of Ash Flat, Arkansas, appeared today in The United States District Court in Fort Smith before The Honorable P.K. Holmes, III to enter a Change of Plea of Guilty to the charge of Coercion and Enticement of a Minor. Lamoureaux previously practiced family medicine in Horseshoe Bend, Arkansas and Dexter, Missouri and was also employed at the VA Medical facility in West Plains, Missouri.
U.S. Attorney Eldridge commented, “The conduct exposed in this case is reprehensible and shows that the threat of abuse to young and innocent children is serious, ever-present, and very real. Our office will continue to work with law enforcement to identify what these criminals do behind closed doors and then prosecute them and bring them to justice.”
According to court records, officers with the Fort Smith Police Department began an undercover online investigation on January 4, 2015 directed at individuals who were using the internet to target minors for purposes of engaging in illegal sexual activity. During the operation, an undercover officer entered an internet chat room posing as an adult mother offering her four year old daughter for sexual exploitation. The undercover officer then made contact with the Defendant, later identified as Donald Wayne Lamoureaux. During the online conversation, Lamoureaux stated that he was a family practice doctor living in Northeast Arkansas, and provided the undercover officer with a picture of himself. From the information and picture provided, the undercover officer was able to identify the individual as Donald W. Lamoureaux. Lamoureaux then expressed that he would like to meet the undercover officer and her four year old daughter for sexual purposes. Following more discussion, the undercover officer and Lamoureaux scheduled a meeting for February 6, 2015 at a hotel in West Plains, Missouri with the supposed and stated purpose for him to sexually abuse the child. On February 2, 2015, Lamoureaux asked the undercover officer to set up a bank account so he could deposit money for expenses associated with the transportation of the four-year-old child to meet with him. Lamoureaux made the deposit in the amount of $300.00 on February 4, 2015. He was arrested in West Plains, Missouri on Friday, February 6, 2015, when he arrived at the meeting location.
Sentencing will be held on a later date. The charge of Coercion and Enticement of a minor carries a mandatory minimum sentence of not less than 10 years imprisonment without the possibility of parole and up to a life sentence, not more than $250,000 fine, or both, and a term of supervised release of not less than five years which begins after release from prison.
This case was investigated by Homeland Security Investigations, the Fort Smith Police Department, the West Plains Police Department, and the Southwest Missouri Cyber Crimes Task Force. Assistant United States Attorney Dustin Roberts is prosecuting the case for the United States.
The case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and their Criminal Division Child Exploitation and Obscenity Sections (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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Related court documents may be found on Public Access to Electronic Records Website @www.Pacer.gov
Mississippi man sentenced to four years in prison for bank fraudRead the Press Release
A Mississippi man was sentenced to more than four years in prison for a conspiracy in which he defrauded a Tennesse bank out of $1.2 million, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, adn Stephen D. Anthony, Special Agent in Charge of the FBI's Cleveland office.
Paul D. Allen, 53, of Oxford, Mississippi, previously pleaded guilty to one count of conspiriacy to commit bank fraud.
He was sentenced to 51 months in federal prison and ordered to pay more than $1.2 million in restitution.
Allen, a self-proclaimed entrepreneur and businessman, moved to the Northern District of Ohio in 1999. Prior to that, he lived in Tennessee, where he developed a relationship with Stephen Henry, an unindicted co-conspirator.
Allen and Henry executed a scheme to defraud Oakland Deposit Bank and obtain money and property from the bank by means of materially false and fraudulent representations. The bank was chartered and had offices in Tennessee. Henry served as president of the bank and also served as a loan officer, according to court documents.
Allen contacted several people in Ohio and recruited them to invest in various business projects he promoted, including B-Telecom Incorporated, a purported data-storage company. Allen promised investors they would receive a percentage ownership in the business in return for the investors obtaining loans from the Oakland Deposit Bank in their own names. Allen told the investors the loan proceeds would be used for operating the business, according to court documents.
Between 2003 and 2008, Allen had the investors complete loan documentation in support of the loans, and then submit the loan applications to Henry, or accompany the investors when they submitted the loan applications to Henry. Allen forged borrower signatures on loans for amounts ranging between $42,770 and $168,000. He sometimes took out additional loans in borrowers' names without their knowledge. He used the proceeds to pay personal expenses or to make interest payments on existing loans, according to court documents.
The case is being prosecuted by Assistant U.S. Attorney M. Kendra Klump following an investigation by the Federal Bureau of Investigation (Cleveland Division, Painesville Resident Agency) and with the assistance of the Geauga County Prosecutor’s Office.
Middle School Teacher Charged with Attempting to Purchase Live Video Sex Shows Involving Filipino ChildrenRead the Press Release
BOSTON – A Middle School teacher was charged today in U.S. District Court in Worcester with attempting to purchase live video sex shows involving Filipino children.
Scott Peeler, 53, who resides in Worcester, was charged in a criminal complaint with attempting to entice and coerce a minor to engage in sexual activity and receipt of child pornography.
According to court documents, between April 2013 and July 2014, Peeler used Internet-based instant messaging services with video streaming capabilities to communicate with individuals in the Philippines engaged in child sex trafficking and the sale of live streaming sex shows involving children. Utilizing Internet-based money transfer services, Peeler attempted on at least four occasions to arrange the purchase of live video sex shows involving children who ranged from four to fourteen years of age.
When confronted by officers at the time of his arrest, Peeler admitted that he was the user of the email and instant messaging account that had been used to solicit the streaming videos, but claimed that he had never actually purchased any videos. A preliminary forensic review during the execution of the search warrant revealed the presence of child pornography on Peeler’s computer.
The leaders of this child sex trafficking organization were identified as a result of tips provided to the National Center for Missing and Exploited Children. Filipino authorities, working in conjunction with Homeland Security Investigations and the FBI, have identified and arrested the members of the organization, and rescued the children being exploited. The operators of the child sex trafficking organization will face prosecution in the Philippines.
The charge of coercing and enticing a minor provides for a mandatory minimum sentence of 10 years and up to a lifetime in prison, a minimum of five years and up to a lifetime of supervised release, and a fine of $250,000. The charge of receipt of child pornography provides for a mandatory minimum sentence of five years and no greater than 20 years in prison, a minimum of five years and up to a lifetime of supervised release, and a fine of $250,000. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz; Worcester County District Attorney Joseph D. Early, Jr.; Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Michael Shea, Deputy Special Agent in Charge of Homeland Security Investigations in Boston; Colonel Timothy P. Alben, Superintendent of the Massachusetts State Police; and Worcester Police Chief Gary J. Gemme, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Mark Grady of Ortiz’s Worcester Branch Office.
The details contained in the charging documents are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The case is brought as part of Project Safe Childhood. In 2006, the Department of Justice created Project Safe Childhood, a nationwide initiative designed to protect children from exploitation and abuse. Led by the U.S. Attorneys’ Offices and the DOJ’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, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov/.
Members of the public who have questions, concerns or information regarding this case should call 617-748-3274.
Miami-Dade County Resident Sentenced for Identity Theft Fraud Scheme Involving $322,000 in Cashed Tax Refund ChecksRead the Press Release
A Miami-Dade County resident was sentenced to 37 months in prison, followed by three years of supervised release, and was ordered to pay restitution of $322,617.31, for his participation in an identity theft fraud scheme involving cashed tax refund checks.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), and Neil Melofchik, Acting Special Agent in Charge, U.S. Secret Service (USSS), Miami Field Office, made the announcement.
Eldridge Nichols, 41, of Miami, previously pled guilty to one count of theft of government money.
According to court documents, from February 2011 to January 2012, the defendant had access to and control over a bank account in the name of Eldridge Nichols LLC in Miami, Florida. Nichols caused fraudulent tax refund checks to be deposited into this account. Approximately forty-three U.S. Treasury tax refund checks, totaling approximately $322,000, were cashed through this bank account. Nichols used the proceeds from the fraudulent tax refund checks for travel, clothing, entertainment, and other personal purposes.
Law enforcement contacted a sample of individuals who had a tax refund check in their name cashed in this account. All of the individuals advised that they did not know of the defendant, that they did not authorize Nichols to have possession of a tax refund check in their name, and that they did not personally receive any of the proceeds from this unauthorized tax refund.
Mr. Ferrer commended the investigative efforts of IRS-CI and the USSS. This case is being prosecuted by Assistant U.S. Attorney Michael N. Berger.
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.
Miami-Dade County Man Sentenced to 151 Months for Receiving Child PornographyRead the Press Release
A Miami-Dade County resident was sentenced to a term of imprisonment of 151 months for receipt of child pornography.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Neil Melofchik, Acting Special Agent in Charge, United States Secret Service (USSS), Miami Field Office, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Alysa D. Erichs, Special Agent in Charge, United States Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), J.D. Patterson Jr., Director, Miami Dade Police Department (MDPD), Daniel J. Oates, Chief, Miami Beach Police Department (MBPD) and Leonard Burgess, Chief, North Miami Police Department (NMPD), made the announcement.
Jefferson Sanchez, 32, of Homestead, was sentenced yesterday to 151 months in prison, to be followed by a lifetime of supervised release. Sanchez was also ordered to register as a sex offender upon his release from prison. Sanchez previously pled guilty to receiving a visual depiction of a minor engaged in sexually explicit conduct, in violation of Title 18, United States Code, Section 2252(a)(2).
According to court documents and information provided in court, on January 29, 2015, law enforcement officers executed a search warrant at Sanchez’s home after receiving information that a computer user at the residence was downloading child pornography. While executing the search warrant, agents followed a trail of water from the bathroom to a closet, where they found Sanchez’s wet laptop inside a storage bin covered by clothes. A forensic examination of the computer revealed videos and images of child pornography and that the defendant had downloaded a child pornography video just before agents executed the search warrant.
Mr. Ferrer commended the investigative efforts of the USSS, FBI, ICE-HSI, MDPD, MBPD and NMPD. This case was prosecuted by Assistant U.S. Attorney Jonathan Kobrinski.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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.
Miami Resident Pleads Guilty in Identity Theft Tax Fraud Scheme Involving Thousands of Deceased and Other Individuals’ Personal Identifying InformationRead the Press Release
A Miami resident pled guilty for participating in an identity theft tax fraud scheme involving thousands of deceased and other individuals’ personal identifying information (PII).
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Neil Melofchik, Acting Special Agent in Charge, U.S. Secret Service (USSS), Miami Field Office, Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), and J. Scott Dennis, Chief, North Miami Beach Police Department (NMBPD), made the announcement.
Yovaris Pardo, 40, of Miami, pled guilty to one count of possessing a counterfeit access device, in violation of Title 18, United States Code, Section 1029(a)(1), one count of possessing fifteen or more unauthorized access devices with the intent to defraud, in violation of Title 18, United States Code, Section 1029(a)(3), and one count of aggravated identity theft, in violation of Title l8, United States Codes Section 1028A.
According to court documents, on April 22, 2013, Pardo knowingly used a counterfeit credit card to purchase tires at a Pep Boys Store in North Miami, Florida. Pardo knew that the credit card was counterfeit and acted with the intent to defraud. On July l0, 2013, law enforcement encountered Pardo and executed a search warrant for the contents of her vehicle in Miami-Dade County. In her vehicle, Pardo had numerous counterfeit credit cards, counterfeit driver's licenses, social security cards belonging to other individuals, debit cards also in the names of other individuals that contained fraudulent tax refunds, numerous tax documents, printouts of death record search results (containing names, dates of birth, and social security numbers for deceased people), and notebooks containing handwritten identities (names, dates of birth, social security numbers). Pardo knowingly possessed the approximately 1,320 unauthorized access devices (i.e. debit card numbers, credit card numbers, social security numbers) that were found in her vehicle. Pardo did not have permission or authority to possess or use the PII belonging to the other individuals.
In addition, a forensic examination of Pardo's laptop that was found in the trunk of her vehicle revealed approximately 4,095 death record search results (containing names, dates of birth, and social security numbers for deceased people) and 48 additional credit card numbers. The laptop also contained pictures of credit card skimmers, embossing machines, and credit card readers, as well as software to make fraudulent credit cards, and subscriptions to fraud programs.
Pardo is scheduled to be sentenced on September 10, 2015 at 10:30 a.m. before United States District Judge Robin L. Rosenberg. At sentencing, the defendant faces a maximum of fifteen years in prison for the counterfeit access device charge, ten years in prison for the access devices charge, and a mandatory term of two years’ imprisonment, consecutive to any other prison term, for the aggravated identity theft charge.
Mr. Ferrer commended the investigative efforts of the USSS, IRS-CI and NMBPD. This case is being prosecuted by Assistant U.S. Attorney Vanessa Snyder.
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.
Manchester Man Pleads Guilty to Bank RobberyRead the Press Release
CONCORD, NEW HAMPSHIRE: Matthew Ireland, 36, of Manchester, New Hampshire, appeared in United States District Court today and entered a guilty plea to one count of bank robbery announced Acting United States Attorney Donald Feith.
Ireland walked into a TD Bank in Manchester, New Hampshire, on January 31, 2015 wearing a black ski mask, a hood, sunglasses, and dark clothing. He demanded money from two tellers and made off with a quantity of stolen funds.
The defendant was apprehended the same day near the Manchester/Bedford town line. When Manchester and Bedford Police attempted to initiate a traffic stop of Ireland’s vehicle, he led them on a brief chase. After crashing his car into a median, he fled on foot but surrendered shortly thereafter, dropping to his knees, reaching into his pockets, and throwing a large sum of cash into the road. Manchester Police recovered most of the stolen money and found clothing consistent with that worn during the robbery in Ireland’s vehicle. Ireland – who faces a maximum sentence of twenty years in prison and criminal fines of up to $250,000 – will be detained pending sentencing, which is presently scheduled for October 7, 2015.
“The successful resolution of this bank robbery is due to the great investigative work of the Manchester Police and the Bedford Police and the assistance of the Federal Bureau of Investigation,” stated Acting United States Attorney Donald Feith. “Bank robbery, even an unarmed bank robbery, is an inherently dangerous crime that causes great turmoil to its victims. We will continue to work with our state and local partners to vigorously prosecute these dangerous crimes.”
This case was investigated by the Manchester Police Department, the Bedford Police Department, and the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorney Georgiana Konesky.
Last Defendant Charged in Stolen Identity & Tax Fraud Scheme Sentenced to over 7 Years in Federal PrisonRead the Press Release
STATESBORO, GA – Stacy Williams, 42, of Statesboro, Georgia, was sentenced last week by Chief United States District Court Judge Lisa Godbey Wood to 94 months in prison. On September 23, 2014, a jury convicted Williams of conspiracy, wire fraud, wrongful disclosure of individually identifiable health information, and aggravated identity theft. Williams was the last of 15 federal defendants charged in April 2014 for their roles in a large-scale identity theft and tax fraud scheme. With last week’s sentencing of Williams, all 15 defendants have now been convicted and sentenced. United States Attorney Edward Tarver said, “These convictions demonstrate the continuing commitment of the United States Department of Justice to prosecute those who steal the identities of American citizens in order to commit tax fraud. Federal law enforcement partners will continue to track down identity thieves and bring them to justice. This U. S. Attorney’s Office along with its federal and state law enforcement partners will not stop until the individuals running these identity theft and tax fraud rings within the Southern District of Georgia are found, prosecuted, and sent to federal prison.” IRS Criminal Investigation Special Agent in Charge Veronica Hyman-Pillot said, “IRS Criminal Investigation is sworn to protect the tax system and bring to justice those who steal from the Treasury. These defendants perpetuated an elaborate scheme driven by insatiable greed and a blatant disregard for the tremendous damage inflicted on innocent victims. The sentences in these cases demonstrate that stealing from the American people will not be ignored or go unpunished.” J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office, stated: “The sentencing of Williams brings to a conclusion an extensive scheme to not only defraud the U.S. Government but also to steal the very identities of numerous individuals and to use that information in furtherance of their fraudulent schemes. This case clearly represents a trending crime problem but also illustrates the combined law enforcement efforts in dealing with it.” In addition to Williams, the other participants convicted and sentenced as part of this prosecution included: AISHIA MILLS, 32, Statesboro, Georgia, 27 months in prison; ANGELLICA ROBERTS, 28, Claxton, Georgia, 126 months in prison; CANDACE HILLS, 24, Claxton, Georgia, 36 months in prison; CHRYSTAL HARLIE, 33, Statesboro, Georgia, 54 months in prison; DEONDRAY RICHARDSON, 40, Keysville, Georgia, five years of probation; KATRINA BEASLEY, 32, Claxton, Georgia, 104 months in prison; LATASHA CHARLES, 29, Statesboro, Georgia, 57 months in prison; MARQUITA WATSON, 31, Claxton, Georgia, 18 months in prison; MARTISHA HILL, 41, Augusta, Georgia, 42 months in prison; MARY MCDILDA, 64, Claxton, Georgia, five years of probation; MELISSA WHITFIELD, 34, Statesboro, Georgia, 40 months in prison; MONICA WHITFIELD, 33, Statesboro, Georgia, 42 months in prison; SANTANA LUNDY, 29, Statesboro, Georgia, 69 months in prison; and, TERRY GORDON, 33, Swainsboro, Georgia, 81 months in prison. FBI Special Agent Marcus Kirkland, IRS Special Agents Gwen Weston and Jason Dulin, and Sergeant James Winskey of the Statesboro Police Department, assisted by their agencies’ colleagues, conducted the investigation. Assistant United States Attorneys Lamont A. Belk and C. Troy Clark prosecuted these cases on behalf of the United States. For additional information, please contact First Assistant United States Attorney James D. Durham at (912) 201-2547.Kent County Man Sentenced to Incarceration for Drugs, Gun and Dog FightingRead the Press Release
WILMINGTON, Del. – Charles M. Oberly, III, United States Attorney for the District of Delaware, announced that Dawan Nelson, age 33, of Houston, Delaware, was sentenced today by United States District Court Judge Sue L. Robinson to 88 months incarceration. Nelson had pled guilty to possessing 33 kilograms of cocaine with intent to distribute, being a felon in possession of a firearm, and dog fighting.
According to statements made at the sentencing hearing and documents filed in court, Delaware State Police and Delaware Animal Care and Control officers searched Nelson’s home in Houston, Delaware, on January 8, 2013, and found 33 kilograms of cocaine, two loaded semi-automatic pistols, and 67 American Terrier Pit Bulls. Many of the pit bulls bore scars from dog fighting. During the search, officers also found disposable skin staplers, a gallon bottle of iodine, weighted collars, weighted sleds, breaking sticks and spring poles. The investigation showed that dogs that lost matches sometimes were disposed of by being shot or suffocated.
Following the sentencing, Charles M. Oberly, III, United States Attorney for the District of Delaware, stated, “Depravity associated with dog-fighting, including the torture and execution of dogs, deserves punishment associated with such cruelty.”
This successful prosecution at the federal level sends a message that dog fighting is illegal and will not be tolerated in Delaware,” said Capt. Sherri Warburton, Delaware Animal Care and Control.
This case was investigated by the Delaware State Police, the Drug Enforcement Administration, Delaware Animal Care and Control, and the U.S. Department of Agriculture. The case was prosecuted by Assistant United States Attorney Edmond Falgowski.
Katy Man Convicted of Federal Hate Crime for Assaulting Elderly African-American ManRead the Press Release
HOUSTON – A man from Katy has entered a guilty plea to a federal hate crime related to the racially-motivated assault of an 81-year-old African-American man, announced U.S. Attorney Kenneth Magidson and Principal Deputy Assistant Attorney General Vanita Gupta of the Civil Rights Division.
Conrad Alvin Barrett, 29, was charged with violating the Matthew Shepard and James Byrd Jr. Hate Crimes Prevention Act. On Nov. 24, 2013, he attacked the elderly African-American man because of the man’s race and color in what Barrett called a “knockout.”
“The defendant’s admissions today resolve any question as to his guilt and are consistent with what we had planned to present at trial,” said Magidson. “We do not take criminal civil rights violations lightly and are now prepared to move forward at sentencing to fully advocate for the appropriate punishment in this case.”
At the hearing today, evidence revealed that Barrett recorded himself on his cell phone attacking the African-American man. In the recording, Barrett questions whether there would be national attention if he attacked a person of color. Barrett also claimed he would not hit “defenseless people” just moments before punching the elderly man in the face and with such force that the victim immediately fell to the ground. Barrett then laughed and said “knockout” as he ran to his vehicle and fled. The victim suffered two jaw fractures and was hospitalized for several days as a result of the attack.
“This was a senseless and heinous act of violence that was committed simply because the victim was African American,” said Gupta. “The Department of Justice will continue to use every tool in our arsenal to vindicate the rights of victims of violent crimes.”
The Matthew Shepard and James Byrd Jr. Hate Crimes Prevention Act was passed on Oct. 22, 2009, and signed into law by President Barack Obama six days later. Shepard was a gay student who was tortured and murdered in 1998 near Laramie, Wyoming. Byrd was an African American man who was tied to a truck by two white supremacists, dragged behind it and decapitated in Jasper in 1998.
U.S. District Judge Gray Miller accepted Barrett’s plea today and has set sentencing for Sept. 18, 2015. At that time, he faces up to 10 years in federal prison and a $250,000 fine.
The charges are the result of an investigation conducted by the FBI in cooperation with the Fulshear and Katy Police Departments as well as the Drug Enforcement Administration. Assistant U.S. Attorneys Ruben R. Perez and Joe Magliolo are prosecuting the case along with Civil Rights Division Trial Attorneys Saeed Mody and Olimpia Michel in cooperation with Ft. Bend County District Attorney John Healey.
Kansas Woman Sentenced to 22 Years for Stealing $731,000 from Two EmployersRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Bucyrus, Kan., woman was sentenced in federal court today for a bank fraud scheme in which she embezzled more than $543,000 from one employer, and admitted that she also stole more than $188,000 from a subsequent employer.
Susan Elise Prophet, 46, of Bucyrus, was sentenced by U.S. Chief District Judge Greg Kays to 22 years in federal prison without parole. The court also ordered Prophet to pay $668,889 in restitution to her former employers; this is in addition to a 2013 Dodge Ram 1500 Sport, a 2013 Harley Davidson FLTRX Road Glide motorcycle, a 2008 Ford Focus, a 2005 Chevrolet Tahoe and a 2003 Chevrolet Trailblazer, all of which were purchased with proceeds of the fraud scheme and have already been acquired by her former employer to recuperate some of the loss.
On Aug. 13, 2014, Prophet pleaded guilty to one count of bank fraud and one count of aggravated identity theft. Prophet admitted that she embezzled $543,034 from Dorfman Plumbing Supply Company in Kansas City, Mo., by forging her employer’s signature on 104 checks, 99 of which were written to herself. After her theft was discovered and she was fired by Dorfman, Prophet was hired as a bookkeeper at a Paoloa, Kan., nursing center. Prophet admitted that she also embezzled at least $188,460 from this employer. According to court documents, Prophet defrauded several other employers as well.
Prophet worked as a bookkeeper for Dorfman from December 2012 until she was fired eight months later in August 2013. (The company has since been sold to Ferguson Enterprises, Inc., a national distributor of residential and commercial plumbing supplies.) Prophet was known to her employer as “Susan Morriss.” She touted that she was the wife of a federal law enforcement agent, which was true at or close to the time she was hired. In a separate and unrelated case, former ICE-Homeland Security Investigations agent Jeffrey Morriss was convicted of making false statements to FBI agents in regard to a more than $800,000 mortgage fraud scheme.
Prophet used the funds for her personal enrichment, purchasing trucks, a car, a motorcycle, travel, furniture, electronics, a gym membership, tattoos and other items. Prophet spent at least $130,424 on vehicle-related purchases, including a 2013 Dodge Ram 1500 Sport; a 2013 Harley Davidson FLTRX Road Glide motorcycle; a 2008 Ford Focus; a 2005 Chevrolet Tahoe; and a 2003 Chevrolet Trailblazer. Prophet withdrew at least $86,000 from her accounts and wrote nearly $21,000 in checks to herself or to cash. She used the embezzled funds to pay her rent and pay down her debts, and spent at least $15,096 at restaurants, $12,743 on travel, $6,703 on electronics, and $9,221 at Nebraska Furniture Mart.
Prophet took steps to conceal her scheme, such as altering the company’s financial records to show that vendors had been paid when, in fact, they had not been paid. When vendors attempted to collect, Prophet answered the calls and hid the claims from her employer. As vendors began to freeze the company’s accounts, Prophet created new checks and forged her employer’s name on the checks to pay the most critical invoices.
When Prophet was hired by Dorfman in November 2012 she did not disclose her criminal history or that she was prohibited by her supervision conditions from working as a bookkeeper. She did not inform her parole officer of her new employment. Prophet began embezzling from the company the very next month.
On Aug. 7, 2013, company owner Charles Dorfman met with Scott Rayburn, a representative of Ferguson Enterprises, regarding the company’s sale to Ferguson. Prior to the meeting, Rayburn sent an e-mail to Dorfman containing a list of all the outstanding invoices that needed to be satisfied before the completion of the sale. During the negotiation process, Rayburn thanked Dorfman for paying the outstanding invoices to Ferguson via an electronic funds transfer of $10,000. Dorfman had neither ordered nor authorized the transfer. The electronic authorization form had been filled out by Prophet (who signed Dorfman’s name). At the conclusion of the meeting, Dorfman contacted bank officials regarding the known forgeries committed by Prophet and she was fired.
According to court documents, Prophet defrauded several other employers prior to being hired by Dorfman, and defrauded another employer after being fired from Dorfman.
In August 2012, Prophet apparently committed felony theft with respect to Mainstreet Credit Union, causing an apparent loss of $6,264. The same month, Covenant Network of Presbyterian Churches hired Prophet as a temporary administrative assistant and bookkeeper. From Aug. 30, 2012, through Sept. 11, 2012, Prophet stole checks from the church and wrote checks to herself by putting her name, or variations of her name, as the payee, and forged the executive director’s signature. She endorsed and deposited several checks into her bank account. The church’s loss was $10,997. On Oct. 1, 2012, a Liberty attorney hired Prophet as his part-time secretary for $10 per hour. She forged approximately $12,300 in checks on his firm’s account, and she opened or attempted to open six credit cards in his name.
A few months after being fired from Dorfman, on or about Oct. 10, 2013, Prophet obtained another bookkeeping job at North Point Skilled Nursing in Paola, Kan. She did not disclose her criminal history or that she was prohibited by her supervision conditions from working as a bookkeeper. She did not inform her parole officer of her new employment. Following her Feb. 28, 2014, arrest on the federal indictment, North Point discovered that Prophet had been embezzling from North Point as well, also by writing numerous checks to herself and altering the ledgers to conceal where the money actually went. The loss from this embezzlement was at least $188,460.
Prophet had worked as a bookkeeper for multiple companies beginning in Tennessee at least in 2002, and she sustained a felony conviction or convictions related to those positions. Upon her release from prison, Prophet applied to transfer her supervision from Tennessee to Kansas in 2009. Her release conditions prohibited her from any employment where she would have access to cash, checks or any account information of her employer. She was required to keep her parole officer continuously informed of her residence and employment, and to notify her employer of her felony convictions.
This case was prosecuted by Assistant U.S. Attorney Daniel M. Nelson. It was investigated by the FBI and the Kansas City, Mo., Police Department.
Justice Department Settles Discrimination Lawsuit Against Texas-Based Kung Fu Saloon Restaurant and BarRead the Press Release
The Justice Department announced today that it has reached a settlement resolving allegations of race, color and national origin discrimination with the owners and operators of Kung Fu Saloon, a bar and restaurant with locations in Dallas, Houston and Austin, Texas. The Justice Department alleged that Kung Fu Saloon discriminated against African-American and Asian-American patrons by denying them admission at its area locations. The settlement requires Kung Fu Saloon to implement changes to policies and practices in order to prevent such discrimination.
The Justice Department’s complaint alleges that the defendants – Routh Guys LLC doing business as Kung Fu Saloon; Washington Guys LLC doing business as Kung Fu Saloon; and Grand Guys LLC doing business as Kung Fu Saloon – violated Title II of the Civil Rights Act of 1964 by engaging in a pattern or practice of discrimination against African-American and Asian-American patrons because of their race, color and national origin. Specifically, the suit alleges that in dozens of instances, the defendants denied African-American patrons entry into Kung Fu Saloon locations based on a dress code when similarly dressed white patrons were permitted to enter. The complaint also alleged that the defendants engaged in other practices to limit the number of African-American and Asian-American patrons at Kung Fu Saloon’s locations.
The consent decree submitted to the court today will resolve this matter. The terms of the decree require the defendants to comply with federal law by not discriminating against patrons on the basis of race, color or national origin; to post and enforce a non-discriminatory dress code policy; to implement a system for receiving and investigating complaints of discrimination; and to conduct monitoring to ensure that Kung Fu Saloon’s employees are acting in a non-discriminatory manner consistent with federal law.
“Places of public accommodations, such as bars and restaurants like Kung Fu Saloon, should be open to all persons, regardless of race or national origin,” said Principal Deputy Assistant Attorney General Vanita Gupta of the Justice Department’s Civil Rights Division. “The Justice Department will continue to work vigorously to protect the rights of persons of all races and national origins to be free from discrimination in public accommodations across the country.”
“This settlement resolves serious allegations of racial and national origin discrimination at Kung Fu Saloon locations in Texas, and it should make clear that any illegal discrimination in places of public accommodations will not be tolerated,” said Acting U.S. Attorney John R. Parker of the Northern District of Texas.
Title II of the Civil Rights Act of 1964 prohibits discrimination on the basis of race, color, religion or national origin in places of public accommodation, such as restaurants, hotels, movie theaters, nightclubs, stadiums and other places of exhibition or entertainment. Under Title II, the Civil Rights Division can obtain injunctive relief that changes policies and practices to remedy customer discrimination. Title II does not authorize the division to obtain specific relief, such as monetary damages, for individual customers who are victims of discrimination.
More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt. Persons who believe they have experienced or witnessed unlawful discrimination in public accommodations may contact the Housing and Civil Enforcement Section at (202) 514-4713.
Joint Statement by the Department of Justice and the Office of the Director of National Intelligence on the Declassification of the Resumption of Collection Under Section 215 of the USA Patriot Act as Amended by the USA Freedom ActRead the Press Release
Yesterday, the Foreign Intelligence Surveillance Court (FISC) issued an opinion and primary order approving the government’s application to renew the Section 215 bulk telephony program. The USA FREEDOM Act of 2015 banned bulk collection under Section 215 of the USA PATRIOT Act, but provided a new mechanism to allow the government to obtain data held by the providers. To ensure an orderly transition to this new mechanism, the USA FREEDOM Act provides for a 180-day transition period during which the existing National Security Agency (NSA) bulk telephony metadata program may continue. After considering the views of amici, the court held that the continuation of the NSA’s bulk telephony metadata program during the transition period remains consistent with both the statute and the Fourth Amendment.
As background, early last year in a speech at the Department of Justice, President Obama announced a transition that would end the Section 215 bulk telephony metadata program as it previously existed. The President directed the intelligence community and the Attorney General to develop options for a new approach to match the capabilities and fill gaps that the Section 215 program was designed to address without the government holding this metadata. After carefully considering the available options, the President announced in March 2014 that the best path forward is that the government should not hold this data in bulk, and that the data should remain at the telephone companies with a legal mechanism in place that would allow the government to obtain data pursuant to individual orders from the FISC approving the use of specific numbers for such queries.
President Obama also noted that legislation would be required to implement this option and he called on Congress to enact this important change. The administration subsequently worked closely with members of Congress to enact the president’s proposal. On June 2, 2015, Congress passed and President Obama signed the USA FREEDOM Act of 2015, which reauthorized several important national security authorities; banned bulk collection under Section 215 of the USA PATRIOT Act, under the pen register and trap and trace provisions found in Title IV of FISA, and pursuant to National Security Letters; and adopted the new legal mechanism proposed by the President.
As in past primary orders in effect since February 2014, and consistent with the president’s direction, the court’s new primary order requires that during the transition period, absent a true emergency, telephony metadata can only be queried after a judicial finding that there is a reasonable, articulable suspicion that the selection term is associated with an approved international terrorist organization. In addition, the query results must be limited to metadata within two hops of the selection term instead of three.
In addition to the release of the court’s opinion, the administration is undertaking a declassification review of this most recent primary order, and when complete, the Office of the Director of National Intelligence will post the document to its website and icontherecord.tumblr.com.
FISC Opinion and Order
Jersey City, New Jersey, Man Admits Trafficking Threatened TurtlesRead the Press Release
NEWARK, N.J. – A Jersey City, New Jersey, man today admitted conspiring to traffic turtle species designated as threatened under New Jersey state law, U.S. Attorney Paul J. Fishman announced.
Patrick Elfers, 48, pleaded guilty before U.S. District Judge Stanley R. Chesler in Newark federal court to an information charging him with one count of conspiracy to violate the Lacey Act, which prohibits the interstate sale of wildlife with a market value of more $350 that has been taken or possessed in violation of any state law or regulation. He was released on $50,000 unsecured bond.
According to documents filed in this case and statements made in court:
New Jersey’s Endangered and Nongame Species Act prohibits the taking, possession, transportation, exportation or sale of spotted turtles, North American wood turtles and Eastern box turtles, among other species. New Jersey has designated the North American wood turtle as threatened because it is a vulnerable species that could become endangered. The spotted turtle and Eastern box turtle are listed as species of special concern.
Elfers admitted that, from December 2011 through March 2014, he possessed various turtle species, including spotted turtles, North American wood turtles, and Eastern box turtles, at his home in Jersey City without the required permits under New Jersey State law. He advertised the turtles on wildlife trade websites to prospective purchasers in New Jersey and elsewhere. Elfers also shipped turtles to purchasers in New York State by tying them in tube socks to restrict their movement and packing them in boxes that were neither designed nor appropriate for the shipment of live animals.
The charge to which Elfers pleaded guilty carries a maximum potential penalty of five years in prison and a $250,000 fine. Sentencing is scheduled for Sept. 29, 2015.
As part of his plea agreement, Elfers must forfeit more than 40 turtles and pay a fine of $30,450 to the U.S. Fish and Wildlife Service Lacey Act Reward Fund. He must also relinquish 10 Eastern box turtles and any additional turtles or tortoises in his possession, including three Gulf Coast box turtles, one African spur thigh tortoise, and one elongated tortoise.
U.S. Attorney Fishman credited special agents of the U.S. Fish and Wildlife Service, Office of Law Enforcement, under the direction Resident Special Agent in Charge Preston Fant, with the investigation leading to today’s plea.
The Government is represented by Assistant United States Attorney Kathleen P. O'Leary of the U.S. Attorney's Office Health Care and Government Fraud Unit in Newark.
Defense counsel: James R. Lisa Esq., Newark
Jersey City Contractor Admits Conspiring to Rig Contractor Selection Process for Union City Community Development Agency ProjectsRead the Press Release
NEWARK, N.J. – A Hudson County, New Jersey, contractor today admitted conspiring to rig the process for the selection of contractors for projects run by the Union City Community Development Agency, causing losses of at least $40,000, U.S. Attorney Paul J. Fishman announced.
Stanley Parzych, 62, of Jersey City, New Jersey, pleaded guilty to an information charging him with one count of conspiring with agents of a local government agency to obtain by fraud funds provided by Union City. Parzych entered his guilty plea before U.S. District Judge William H. Walls in Newark federal court.
According to documents in this case and statements made in court:
Between June 2007 and November 2010, Parzych owned American Construction, a company located in Jersey City. During that same time period, there was another contractor named Joseph Lado (Lado) who owned a construction company in Union City called Lado Construction LLC. There was also an individual who was an inspector (Inspector 1) at the Union City Community Development Agency (UCCDA), which was a government agency that received funds from the U.S. Department of Housing and Urban Development (HUD) under a federal block grant that provided funding for, among other things, home improvement projects and sidewalk replacement projects.
Parzych conspired with Lado and Inspector 1 to rig the competitive process to perform sidewalk replacement projects and residential rehabilitation projects in favor of certain contractors, including Lado Construction, by submitting false and materially misleading proposals. On many occasions Parzych provided Lado with phony proposals from American Construction that were higher than Lado’s proposals. Sometimes he provided Lado with blank proposal forms from American Construction, which Lado later completed listing amounts that were higher than Lado Construction’s proposals for the same work. Under both of those scenarios, Lado would then submit American Construction’s phony higher-priced proposals and Lado’s own proposals to the UCCDA in order to obtain projects, and ultimately, HUD grant funds, from the UCCDA for the completion of the projects.
The conspiracy charge to which Parzych pleaded guilty carries a maximum potential penalty of five years in prison and a $250,000 fine. Parzych is scheduled to be sentenced on Oct. 7, 2015.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Richard M. Frankel; and special agents of the U.S. Department of Housing and Urban Development, Office of Inspector General, under the direction of Special Agent In Charge Christina Scaringi, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Barbara R. Llanes of the U.S. Attorney’s Office Special Prosecutions Division in Newark.
Defense counsel: Daniel J. Welsh, Jersey City, New Jersey
Jeffersonville man sentenced for making and passing counterfeit U.S. CurrencyRead the Press Release
PRESS RELEASE
New Albany – United States Attorney Josh J. Minkler announced today that Jonathon Alan Frantz, 23, of Jeffersonville, Indiana, was sentenced to 30 months in prison by U.S. District Judge Sarah Evans Barker following his guilty plea to six counts of possessing and passing counterfeit United States Currency and one count of making counterfeit United States Currency. This case was the result of an investigation by the United States Secret Service, the Jeffersonville Police Department and the Clarksville Police Department.
Frantz plead guilty immediately before he was sentenced on June 29, 2015. At the time of his guilty plea, Frantz admitted that he used counterfeit currency to conduct numerous transactions with businesses in Southern Indiana and Northern Kentucky in order to acquire debit cards and genuine currency. Frantz further admitted that he produced the counterfeit United States Currency using on a color printer that was recovered by the Secret Service during the investigation. The total amount counterfeit currency recovered was more than $6,500.
“This case, yet again, demonstrates the Secret Service’s commitment to protect our nation’s monetary system,” said Craig Hutzell, Acting Special Agent in Charge of the Secret Service in Louisville. “The Secret Service was created 150 years ago for this mission, and in partnership with the Jeffersonville and Clarksville Police Departments, we continue to lock up those who take advantage of our merchants and neighbors in these schemes. The determination and skill of agents and detectives, coupled with the partnerships we have created with law enforcement colleagues in Indiana and Kentucky, should send a strong message to would be counterfeiters that these crimes will not go unpunished.”
According to Assistant U.S. Attorney Todd S. Shellenbarger, who prosecuted the case for the government, Judge Barker imposed 3 years of supervised release following Frantz’s release from prison. Frantz must participate in a drug abuse prevention program and submit to drug testing while on supervision. Frantz was ordered to pay restitution in the amount of $7,000.00
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Independence, KC Men Sentenced for $1.2 Million Arson, Insurance Fraud ConspiracyRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that an Independence, Mo., man and a Kansas City, Mo., man were sentenced in federal court today for their roles in a $1.2 million arson and insurance fraud conspiracy.
Joshua Stamps, 28, of Independence, Mo., was sentenced by U.S. District Judge Dean Whipple to 12 years and one month in federal prison without parole. Co-defendant John S. Wayne, 31, of Kansas City, was sentenced to five years in federal prison without parole. The court also ordered Stamps to pay $429,991 in restitution and Wayne to pay $198,824 in restituiton, for which they are jointly and severally liable.
On June 12, 2014, Stamps pleaded guilty to leading the arson and insurance fraud conspiracy and to using fire to commit a federal crime (mail fraud). Stamps, Wayne and four other co-conspirators – all of whom have pleaded guilty and were sentenced today – bought, over-insured and burned five houses, all in Kansas City, Mo. The total actual loss to insurance companies in the scheme was $434,938, while the total intended loss was $1,196,840.
Beginning in July 2007, Stamps bought houses costing from $6,500 to $15,000. Stamps used co-conspirators Michael Smith, 27, and his mother, Randy Stamps, 57, both of Kansas City, Mo., as straw owners for three of the houses. Other co-conspirators acted as tenants so the properties could be classified as rentals.
In the conspiracy that lasted until 2013, Stamps and his co-conspirators insured the houses for much more than the purchase price, in amounts from $88,000 to $307,000. Stamps, Wayne and co-defendant Roy Richard, 34, of Wichita, Kan., burned the houses. The listed owner of the house that burned would then claim a total loss with the applicable insurance company and would falsely claim they had no knowledge of, or involvement in, the fire. Stamps and his co-conspirators made false statements on the insurance applications, such as that the houses were rented and/or occupied, that there were valuable contents in the houses, and that the houses had been renovated.
Wayne pleaded guilty to one count of conspiracy to commit arson, use of a fire to commit a federal crime, mail fraud and wire fraud. In addition to the conspiracy, Wayne also pleaded guilty to one count of arson.
Wayne was injured while setting a house on fire and forced to shed his burning pants in the street. On April 23, 2011, the house at 4901 Agnes partially burned, and the fire was determined to be arson. Two days later, on April 25, 2011, Wayne and Stamps burned the house in another arson fire. This time the house was a total loss.
A witness saw Wayne running from the house with his pants on fire. Wayne took his pants off and left them in the street. Kansas City police detectives recovered burned sweatpants and boots from the street; DNA recovered from the pants confirmed that Wayne wore the burned pants discarded in the street. A chemical analysis established that the pants and boots had evaporated gasoline on them.
Wayne was admitted to Research Medical Center with severe burns to his legs later that day. Wayne told investigators that Stamps, who was driving, refused to take him to a hospital and instead took him home and bought him some burn cream. Wayne said the burn cream wasn’t going to work so he went to the hospital.
Smith, Randy Stamps and Richard each received probationary sentences today. Co-defendant Luis Esquivel, 50, a citizen of Costa Rica residing in Kansas City, Mo., was sentenced to time served (approximately 13 months).
This case was prosecuted by Assistant U.S. Attorney Kathleen D. Mahoney. It was investigated by the Kansas City, Mo., Police Department.
Houston Mother and Son Sent to Prison for Smuggling of MethamphetamineRead the Press Release
HOUSTON – Larry Maurice Favorite, 33, and Juanita Eva Velasquez, 63, both of Houston, have been ordered to federal prison for possession with intent to distribute nearly nine kilograms of a mixture or substance containing methamphetamine and conspiracy to do the same, announced U.S. Attorney Kenneth Magidson. Favorite was convicted by a federal jury Feb. 10, 2015, following a two-day trial, while his mother had entered a guilty plea to her role in the methamphetamine trafficking conspiracy the week prior.
Today, U.S. District Judge Gray Miller handed Velasquez a sentence of 262 months in federal prison to be immediately followed by 10 years of supervised release. Even though she had pleaded guilty to the charge, at the hearing today, Velasquez alternatively claimed she was forced to traffic the drugs against her will and that she did not know she was trafficking drugs. As a result of her claims today, Judge Miller denied a potential reduction in her sentence for accepting responsibility for her criminal conduct. In handing down the sentence, the court also noted her criminal history to include a prior 120-month federal sentence for trafficking cocaine.
On May 21, 2015, Judge Miller handed Favorite a total sentence of 210 months in federal prison. He will also serve five years of supervised release following completion of the prison term.
At trial, the jury heard that on June 22, 2012, Favorite drove a Honda minivan from Laredo to the Border Patrol immigration checkpoint on Highway 59, approximately 16 miles west of Freer. His mother was riding as a front seat passenger. A law enforcement canine alerted to the van in primary inspection, at which time agents sent the van and occupants to secondary inspection. A search was conducted which revealed three unmarked glass bottles in a bag located near the front passenger seat of the van. The bottles contained a brown liquid that appeared to be thicker than water.
Agents then found six more identical looking bottles behind the center console area. The nine bottles held a total of approximately nine liters of liquid, which agents field tested positive for methamphetamine.
Velasquez and Favorite were immediately arrested and agents with the Drug Enforcement Administration (DEA) conducted further investigation. Favorite initially told agents he did not know there were any bottles in the van and that he and his mother had driven down from Houston.
However, when agents asked if the bottles belonged to his mother, Favorite then claimed they were only his. He stated he received them previously from a Hispanic male, but would not elaborate.
The bottles were sent to the DEA laboratory for more thorough testing. The laboratory confirmed the liquid contained methamphetamine having a net weight of 8.966 kilograms with a purity level of 48.4%. The total amount of actual methamphetamine in the bottles was 4.339 kilograms and it had been imported from Mexico.
At the time of Velasquez’s plea, she admitted to having driven from Houston with her son to pick up the bottles containing the drugs and driving them back to Houston for an expected payment of $600 per bottle. She admitted she knew the bottles contained drugs and that she was in fact taking them to Houston for financial compensation.
Previously released on bond, Velasquez was taken into custody following the sentencing today where she will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future. Favorite has been and will remain in custody.
The investigation leading to the charges in this case was conducted by DEA and Border Patrol. Assistant U.S. Attorneys Arthur R. Jones and Anibal Alaniz prosecuted the case.