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Friday 8 May 2015
Madison County Man Pleads Guilty to Robbing Pontoon Beach Gas StationRead the Press Release
Shawn Bequette, 23, a resident of Madison County, Illinois, pled guilty on May 7, 2015, to Hobbs Act Robbery, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today. Bequette was ordered held without bond pending a sentencing hearing scheduled for September 24, 2015, before the Honorable Michael J. Reagan, Chief Judge of the United States District Court for the Southern District of Illinois.
The investigation revealed that in the early morning hours of October 6, 2014, Bequette robbed a gas station in Pontoon Beach, Illinois. Witnesses to the crime chased Bequette as he left the gas station, subdued him, and called the police. The charges in this case include a maximum term of 20 years in prison, a fine of up to $250,000, and up to 3 years of supervised release.
The case was investigated by the Federal Bureau of Investigation and the Pontoon Beach Police Department, and is being prosecuted by Special Assistant United States Attorney Shane B. Kelbley.
Lynn Tax Preparer Arrested on Tax Fraud ChargesRead the Press Release
BOSTON – A Lynn tax preparer was arrested today for filing fraudulent personal federal tax returns and attempting to obstruct the Internal Revenue Service.
Arismendy Ramos, a/k/a Arismendi Ramos, a/k/a Aris Almonte, was charged in a criminal complaint with four counts of filing false tax returns and two counts of obstructing the IRS. U.S. District Court Magistrate Judge Marianne B. Bowler ordered Ramos detained pending a further hearing.
According to allegations in the complaint, Ramos owned and operated Almonte Tax, a tax preparation service in Lynn, and prepared tax returns for numerous clients. Ramos allegedly filed false forms with the IRS claiming that he paid the clients to work for him when, in fact, they had never been employed by him. Ramos then allegedly claimed the bogus wages as business expenses on his own personal tax returns, thereby illegally reducing his own tax liabilities. The obstruction charges allege that Ramos instructed two clients that they should lie if they were asked about the false wages.
The charging statutes provide for a sentence of no greater than three years in prison, one year of supervised release, and a fine of $250,000 for each count. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based on the U.S. Sentencing Guidelines and a number of sentencing factors.
United States Attorney Carmen M. Ortiz and William P. Offord, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Victor A. Wild of Ortiz’s Economic Crimes Unit.
The details contained in the complaint are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Lubbock County Man Sentenced to 108 Months in Federal Prison for Possessing Prepubescent Child PornographyRead the Press Release
LUBBOCK, Texas — A 27-year-old Shallowater, Texas, man, Michael Wayne Brown, was sentenced today by U.S. District Judge Sam R. Cummings to 108 months in federal prison and a 20-year term of supervised release, following his guilty plea in December 2014 to one count of possession of prepubescent child pornography. Acting U.S. Attorney John Parker of the Northern District of Texas made the announcement today.
According to documents filed in the case, Brown owned various telephones and electronic devices, and he stored pornographic images on some of them, including an 8GB Sandisk memory card. On that memory card, Brown stored numerous images of child pornography, some of which involved prepubescent minors.
The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. 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 sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about Internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
The Lubbock Police Department’s Internet Crimes Against Children (ICAC) Task Force and the FBI investigated. Assistant U.S. Attorney Steven M. Sucsy prosecuted.
Kinmundy Man Pleads Guilty to Possession of A Firearm by A Convicted FelonRead the Press Release
Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today that James Conrad Riley, 44, of Kinmundy, Illinois, pled guilty on May 6, 2015, to an Indictment charging him with Possession of a Firearm by a Convicted Felon. The prior felony alleged in the Indictment was Retail Theft, for which Riley was convicted in Ogle County, Illinois, on or about October 13, 2004.
The charges relate to an incident that occurred in April, 2009, when Riley sold four firearms to an individual in Mt. Vernon, Illinois. The transaction did not come to the attention of the Government until late 2013; Riley was charged in March, 2014, shortly before his anticipated release from a halfway house, following incarceration on separate federal charges for Sale of Stolen Motor Vehicles, for which he had been sentenced on November 7, 2011.
Riley also has prior convictions for Burglary of Vehicle, Aggravated Battery, Unlawful Possession of a Motor Vehicle, Driving While License Revoked, and Criminal Trespass.
Sentencing has been set for September 16, 2015, at 10 a.m. in federal district court in East St. Louis. The maximum penalties that can be imposed are ten years in prison, followed by 3 years’ supervised release, a $100 special assessment, and a fine of $250,000.
The case was investigated by members of the Illinois Secretary of State Police and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. The case was prosecuted by Assistant U.S. Attorney Stephen B. Clark.
Justice Department Settles Immigration-Related Discrimination Claim Against the Data Entry Company Inc.Read the Press Release
The Justice Department announced today that it reached a settlement with The Data Entry Company Inc., a government subcontractor headquartered in Bethesda, Maryland. The settlement resolves a charge filed with the Office of Special Counsel for Immigration-Related Unfair Employment Practices (OSC), claiming that the company engaged in hiring discrimination in violation of the Immigration and Nationality Act (INA).
The department’s investigation found that on two occasions The Data Entry Company Inc., removed a U.S. citizen from its pool of applicants because she is a dual citizen, in violation of the INA. The INA’s anti-discrimination provision prohibits employers from engaging in hiring discrimination on the basis of citizenship.
“The Justice Department is committed to identifying and tearing down illegal barriers that prevent authorized workers from working,” said Principal Deputy Assistant Attorney General Vanita Gupta of the Civil Rights Division. “The department commends The Data Entry Company Inc., for working to rectify this situation in a cooperative manner.”
Under the settlement agreement, The Data Entry Company Inc. will pay $7,007.75 in back pay to the charging party and will also pay a civil penalty to the United States. The company also will undergo training on the anti-discrimination provision of the INA.
OSC is responsible for enforcing the anti-discrimination provision of the INA. Among other things, the statute prohibits citizenship status and national origin discrimination in hiring, firing or recruitment or referral for a fee; unfair documentary practices; retaliation; and intimidation. Trial Attorney Silvia Dominguez-Reese investigated this charge.
For more information about protections against employment discrimination under immigration laws, call OSC’s worker hotline at 1-800-255-7688 (1-800-237-2515, TTY for hearing impaired); call OSC’s employer hotline at 1-800-255-8155 (1-800-237-2515, TTY for hearing impaired); sign up for a free webinar at www.justice.gov/crt/about/osc/webinars.php, email [email protected]; or visit OSC’s website at www.justice.gov/crt/about/osc.
Justice Department Opens Pattern or Practice Investigation into the Baltimore Police DepartmentRead the Press Release
Attorney General Loretta E. Lynch announced today that the Justice Department has opened a civil pattern or practice investigation into Baltimore Police Department (BPD), pursuant to the Violent Crime Control and Law Enforcement Act of 1994. The department’s investigation of BPD will seek to determine whether there are systemic violations of the Constitution or federal law by officers of BPD. The investigation will focus on BPD’s use of force, including deadly force, and its stops, searches and arrests, as well as whether there is a pattern or practice of discriminatory policing.
While the pattern or practice investigation is ongoing, the department’s Office of Community Oriented Policing will continue to work with BPD and the collaborative reform process that was started in October 2014 will convert to the provision of technical assistance to the BPD allowing for changes and improvements even as the pattern or practice investigation is underway.
“Our goal is to work with the community, public officials and law enforcement alike to create a stronger, better Baltimore,” said Attorney General Loretta Lynch. “The Department of Justice’s Civil Rights Division has conducted dozens of these pattern or practice investigations, and we have seen from our work in jurisdictions across the country that communities that have gone through this process are experiencing improved policing practices and increased trust between the police and the community. In fact, I encourage other cities to study our past recommendations and see whether they can be applied in their own communities. Ultimately, this process is meant to ensure that officers are being provided with the tools they need – including training, policy guidance and equipment – to be more effective, to partner with civilians and to strengthen public safety.”
During the course of the investigation, the Justice Department will consider all relevant information, particularly the efforts that BPD has undertaken to ensure compliance with federal law, and the experiences and views of the community. The Justice Department has taken similar steps involving a variety of state and local law enforcement agencies, both large and small, in jurisdictions throughout the United States. These investigations have in many instances resulted in comprehensive, court-overseen agreements to fundamentally change the law enforcement agency’s police practices.
In addition to gathering information directly from community members, pattern or practice investigations involve interviewing police officers and local officials; gathering information from other criminal justice stake holders, such as public defenders and prosecutors; observing officer activities through ride-alongs and other means; and reviewing documents and specific incidents that are relevant to our investigation.
Pattern or practice investigations of police departments do not assess individual cases for potential criminal violations. The investigation into BPD is separate from the department’s concurrent criminal civil rights investigation related to the death of Freddie Gray.
This matter is being investigated by attorneys and staff from the Justice Department’s Civil Rights Division. They will be assisted by experienced law enforcement experts. The department welcomes the views of anyone wishing to provide relevant information. Individuals who wish to share information related to the investigation are encouraged to contact the department at 1-844-401-3733 or via email at [email protected].
Police Reform and Accountability Fact Sheet
How P&P Investigations Work
CRI Fact Sheet
Jefferson County Man Indicted on Child Exploitation ChargesRead the Press Release
BEAUMONT, Texas — A 57-year-old Beaumont, Texas man has been indicted on child exploitation charges in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Gary Allen George was indicted by a federal grand jury on May 6, 2015 and charged with receiving child pornography, distributing child pornography and possession of child pornography.
According to the indictment, an investigation revealed that from Aug. 6, 2014 to Sep. 18, 2014, George is alleged to have received, distributed and possessed files containing images or videos of child pornography on his computer. At least one of the images involved a minor under the age of 12-years-old engaging in sexually explicit conduct.
George faces a minimum of 5 years, and up to 20 years, in federal prison if convicted.
This case is being prosecuted as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case is being investigated by Homeland Security Investigations (HSI) and the Beaumont Police Department and prosecuted by Assistant U.S. Attorney Randall L. Fluke.
It is important to note that an indictment should not be considered as evidence of guilt and that all persons charged with a crime are presumed innocent until proven guilty beyond a reasonable doubt.
Immigrant Sentenced to 44 Months in Prison for Illegal ReentryRead the Press Release
St. Thomas, USVI – On Thursday May 7, 2015, District Court Judge Curtis V. Gomez sentenced Terrance L. Hanley a/k/a Robert A. Jenkins, 45, a national of St. Kitts, to 44 months in prison and three years of supervised release for illegal reentry into the United States, United States Attorney Ronald W. Sharpe announced.
Hanley was arrested on November 16, 2014 by agents of the Department of Homeland Security Homeland Security Investigations at the Cyril E. King Airport on St. Thomas after he attempted to board a flight to the mainland United States using the name Robert A. Jenkins. On January 15, 2015, he pleaded guilty to illegal reentry into the United States.
Court records show that in December 2003, Hanley was arrested in New York for conspiracy to import cocaine and heroin, and was deported to St. Kitts in June 2014. He has not obtained permission to reenter the United States.
This case was investigated by the Department of Homeland Security Homeland Security Investigations and was prosecuted by Assistant United States Attorney Everard E. Potter.
Houston Woman Indicted for PerjuryRead the Press Release
HOUSTON – Federal charges have been filed against Amy Fisher, 36, of Houston, alleging she committed perjury during a civil deposition and trial, announced U.S. Attorney Kenneth Magidson.
The indictment was returned under seal April 29, 2015, and unsealed yesterday upon her arrest. She is expected to make her initial appearance before U.S. Magistrate Judge Frances Stacey at 10:00 a.m. today.
“The integrity of the judicial system requires truthfulness from all witnesses in legal matters in order for justice to prevail,” said Magidson. “When perjury allegations are referred to us, we work closely with investigators to determine whether to seek federal criminal charges. We do not take allegations of perjury lightly in any proceeding - civil or criminal - and will pursue those that attempt to undermine the reliability of our legal processes.”
According to the allegations in the indictment, Fisher committed perjury on Nov. 17, 2014, during her deposition and trial testimony related to the civil trial of Lipinski et. al. v. Meritage Co., Civil Action No. H-10-CV-605.
The Meritage case was a Fair Labor Standards Act (FLSA) case that went to trial in Houston in November 2014. One of the primary issues during trial was whether or not Meritage Corporation had properly classified its sales people as “outside salesmen” who are exempt from the FLSA’s overtime and a minimum wage requirements. Plaintiffs, who were all employed as sales associates for Meritage Corporation, argued the company misclassified them as “outside salesmen” to avoid paying minimum wage and overtime pay.
One of the key issues during the civil trial was determining how much time Meritage sales associates spent in sales activity outside of the sales office. Fisher was the only Meritage sales associate who testified on behalf of the corporation. The deposition and trial, which both occurred on Nov. 17, 2014, focused on what activities Fisher performed outside of her sales office.
The indictment alleges that during those proceedings, Fisher was questioned regarding her sales activity that occurred on Nov. 16, 2014, the preceding work day. Fisher is charged with committing perjury by falsely testifying as to her specific actions on that day.
If convicted, Fisher faces up to five years in federal prison and a possible $250,000 fine.
This case is being investigated by the FBI. Assistant U.S. Attorney Julie Searle is prosecuting the case.
Gray, Louisiana Man Indicted for Receipt and Distribution of Child PornographyRead the Press Release
U.S. Attorney Kenneth A. Polite announced that DARION VEAL, age 20, of Gray, Louisiana, was indicted today for crimes involving the sexual exploitation of children.
VEAL was indicted as a result of a child exploitation investigation conducted by the U.S. Department of Homeland Security-Homeland Security Investigations (“HSI”) and the Louisiana Attorney General’s Office, High Tech Crime Unit (“LAGO”). According to court records, on January 7, 2015, HSI and LAGO agents executed a search warrant at VEAL’s residence after determining he received and distributed images depicting the sexual victimization of children. On March 3, 2015, VEAL was taken into federal custody pursuant to a federal criminal complaint.
If convicted, VEAL faces a mandatory minimum penalty of five years and a maximum penalty of twenty years, followed by up to a lifetime term of supervised release, and a $250,000 fine per count. In addition, VEAL will be required to register as a sex offender.
U. S. Attorney Polite reiterated that the Indictment is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
U.S. Attorney praised the work of the U.S. Department of Homeland Security-HSI and the Louisiana Attorney General’s Office, High Tech Crime Unit in investigating this matter. Project Safe Childhood Coordinator and Fraud Unit Chief, Assistant U.S. Attorney Brian M. Klebba is in charge of the prosecution.
Darion Veal Indictment.pdf (176.78 KB)
Fugitive Chinese National Sentenced to Prison for Illegal Firearms ExportsRead the Press Release
A Chinese citizen illegally in the United States was sentenced today in U.S. District Court in Seattle to three years in prison for smuggling firearms, firearms parts and ammunition out of the United States without the proper export control licenses, announced U.S. Attorney Annette L. Hayes. YONG GUO, 45, pleaded guilty in February 2015, admitting that between August 2012 and June 2014, he illegally purchased firearms, firearms parts and ammunition and sold and shipped them to people in Hong Kong and China. GUO shipped about 80 packages using false names and addresses from various post offices in King and Pierce Counties. At sentencing Chief Judge Marsha J. Pechman said “This was a particularly egregious offense… It was not a single act but an ongoing, calculating plan to engage in criminal activity.”
“Illicit firearms trafficking fuels crime and conflicts around the world,” said United States Attorney Annette L. Hayes. “I commend the work of Homeland Security Investigations, with the cooperation of our international partners, to uncover this kind of wrongdoing and ensure dangerous weapons do not end up in the wrong hands.”
In two instances described in the plea agreement, in May 2014, GUO shipped ten .22 caliber rifle bolt assemblies to a contact in Hong Kong. A few weeks later, GUO shipped numerous other parts for .22 caliber rifles. Both packages had been labeled to contain fictitious items such as “steel blocks,” “toy parts,” and a “canvas bag.” Both packages were seized by law enforcement.
“Exporting restricted items, such firearms components and ammunition, without the permission of the U.S. government, is a crime.” said Brad Bench, special agent in charge of Homeland Security Investigations in Seattle. “Mr. Guo knew this and made attempts to evade detection by falsifying export documents, nonetheless his scheme was detected by law enforcement. Stemming the illicit export of firearms, arms components and other sensitive military technology is a high priority for HSI.”
This case was investigated by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) with the assistance of the U.S. Postal Inspection Service, U.S. Customs and Border Protection’s National Targeting Center, the Hong Kong Police Force, and the Hong Kong Customs and Excise Department.
The case was prosecuted by Assistant United States Attorney Todd Greenberg.
Ft. Wright Man Sentenced to 106 Months for Drug and Weapons OffensesRead the Press Release
COVINGTON – A Ft. Wright, Ky., man has been sentenced to 106 months in federal prison for heroin, cocaine and weapons offenses.
On Tuesday, U.S. District Judge David L. Bunning sentenced 27 year-old Michael Daniels, for possession with intent to distribute heroin and crack cocaine and possessing a firearm in furtherance of a drug trafficking crime. Under federal law, Daniels must serve at least 85 percent of his prison sentence; and following his release, he will be under the supervision of the U.S. Probation Office for eight years.
Daniels pleaded guilty on December 1, 2014 and admitted that he had been selling heroin and crack cocaine, while staying at a hotel in Ft. Wright, in June 2014. Agents investigated a complaint about drug activity in Daniels’ hotel room and located 36 grams of heroin, 22 grams of crack cocaine, money, a digital scale, and a loaded 9mm handgun.
Kerry B. Harvey, U.S. Attorney for the Eastern District of Kentucky; Howard S. Marshall, Special Agent in Charge, Federal Bureau of Investigation, and Daniel Kreinest, Chief of the Ft. Wright Police Department, jointly made the announcement today.
The investigation was conducted by the FBI’s Safe Streets Task Force and the Ft. Wright Police Department. Assistant U.S. Attorney Tony Bracke prosecuted this case on behalf of the federal government.
Ft. Thompson Man Sentenced for Failure to Register as A Sex OffenderRead the Press Release
Acting United States Attorney Randolph J. Seiler announced that a Ft. Thompson, South Dakota, man convicted of Failure to Register as a Sex Offender was sentenced on May 5, 2015, by U.S. District Judge Roberto A. Lange.
Wylie Wind, age 28, was sentenced to 18 months in custody, 5 years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Wind was indicted by a federal grand jury on February 11, 2015, and pled guilty to Failure to Register as a Sex Offender on March 10, 2015.
The conviction arose from Wind’s failure to register and update his sex offender registration between December 15, 2014, and February 6, 2015. Wind was required to register as a sex offender due to a prior federal conviction. Wind knowingly failed to register and update his address as required by federal law.
The investigation was conducted by the U.S. Marshals Service. The case was prosecuted by Assistant U.S. Attorney Meghan Dilges.
Wind was remanded to the custody of the U.S. Marshals Service to begin serving his sentence.
Former West Hartford Attorney Sentenced to Prison for Role in Mortgage Fraud SchemeRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that GABRIEL SERRANO, 49, of West Hartford, was sentenced today by Judge Alvin W. Thompson to 12 months and one day of imprisonment, followed five years of supervised release, for his role in an extensive mortgage fraud scheme.
SERRANO, a former attorney, was a partner at the law firm of Serrano & Serrano, LLC in West Hartford until December 2013 when he was suspended from the bar.
According to court documents and statements made in court, from approximately June 2005 to at least November 2008, SERRANO was involved in a mortgage fraud conspiracy with co-defendants Filippos Milios, Malgorzata Karas-Golka, Carmelinda Marotta, Daniel Monteiro, and others that involved the use of straw borrowers, false mortgage applications, false HUD-1 forms, fraudulent down payments, and false verification forms for the purchase of over 50 houses in Hartford, New Haven, and Middlesex counties. SERRANO served as the closing attorney on at least two dozen fraudulent transactions.
SERRANO often served as the closing attorney when Milios purchased properties with financing from private lenders. Later, when Milios sold many of the properties to a buyer, SERRANO usually represented the buyer. In connection with many of the transactions where Milios sold properties, SERRANO knew that Milios, and not the borrower, had provided the required down payment checks on behalf of the borrower. SERRANO often released the seller’s proceeds checks to Milios before receiving a down payment, and he knew that Milios would use the seller’s proceeds checks to obtain the down payment check for the same transaction. In this way, contrary to what SERRANO led the mortgage lenders to believe, the borrowers were purchasing the properties with no down payment funds of their own.
In addition, some of the borrowers purchased multiple properties from Milios and represented to the mortgage lenders that they were purchasing each of the properties as primary residences. SERRANO knew that the borrowers did not intend to use the properties as primary residences.
In the course of many of the fraudulent closings involving Milios’s sale to borrowers, SERRANO received mortgage proceeds from banks and mortgage lenders. SERRANO would frequently disburse some of those proceeds to private lenders who had loaned Milios money to purchase those properties.
The loss attributable to SERRANO’s conduct is this scheme is approximately $3.5 million. The court will hold a subsequent hearing to determine restitution.
On August 6, 2013, SERRANO pleaded guilty to one count of conspiracy to commit mail and bank fraud, and one count of conspiracy to commit money laundering.
Milios, Karas-Golka, Marotta and Monteiro also pleaded guilty and were sentenced to prison terms of 97 months, 30 months, 30 months and 13 months, respectively.
This matter was investigated by the U.S. Department of Housing and Urban Development – Office of Inspector General, the Internal Revenue Service – Criminal Investigation Division, the U.S. Postal Inspection Service and the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorneys David T. Huang and William J. Nardini.
Former U.S. Nuclear Regulatory Commission Employee Charged with Attempted Spear-Phishing Cyber-Attack on Department of Energy ComputersRead the Press Release
Defendant Arrested in the Philippines
An indictment has been unsealed charging Charles Harvey Eccleston, a former employee of the U.S. Department of Energy and the U.S. Nuclear Regulatory Commission (NRC), in connection with an attempted email “spear-phishing” attack in January 2015, targeting dozens of Department of Energy employee e-mail accounts.
The indictment was announced today by Assistant Attorney General for National Security John P. Carlin, Acting U.S. Attorney Vincent H. Cohen Jr. of the District of Columbia and Assistant Director in Charge Andrew G. McCabe of the FBI’s Washington Field Office.
The indictment was unsealed, along with an earlier-filed complaint and affidavit, following Eccleston’s first appearance this afternoon in the U.S. District Court of the District of Columbia. The court ordered that he remain detained pending a hearing set for May 20, 2015.
According to the affidavit, the goal of the attack was to cause damage to the computer network of the Department of Energy through a computer virus that Eccleston believed was being delivered to particular department employees through emails, and to extract sensitive, nuclear weapons-related government information that Eccleston believed would be collected by a foreign country.
An email spear-phishing attack involves crafting a convincing email for selected recipients that appears to be from a trusted source and that, when opened, infects the recipient’s computer with a virus. Attackers may gather personal information about their target to increase their probability of success.
“Combating cyber-based threats to our national assets is one of our highest priorities,” said Assistant Attorney General Carlin. “As alleged in the indictment, Eccleston sought to compromise, exploit and damage U.S. government computer systems that contained sensitive nuclear weapon-related information with the intent to allow foreign nations to gain access to that material. We must continue to evolve our efforts and capabilities to confront cyber enabled threats and aggressively detect, disrupt and deter them. We are grateful for the tireless efforts of law enforcement in this case.”
“This former federal employee is charged with trying to launch a cyber-attack to steal sensitive information from the Department of Energy,” said Acting U.S. Attorney Cohen. “Thanks to an innovative operation by the FBI, no malicious code was actually transmitted to government computers. This prosecution demonstrates federal law enforcement’s vigorous efforts to neutralize cyber threats that put consumers, our economy, and our national security at risk.”
“Computer intrusions are among the greatest cyber threats to our national security,” said Assistant Director in Charge McCabe. “Cyber actors have become increasingly adept at exploiting our computer networks in order to exfiltrate our nation’s secrets and valuable research. As threats to the U.S. government become increasingly complex, the FBI will continue to evolve in order to counter these threats.”
Eccleston, 62, a U.S. citizen who had been living in Davos City in the Philippines since 2011, was terminated from his employment at the U.S. Nuclear Regulatory Commission in 2010. The attack targeted computers at the Department of Energy. Eccleston was detained by Philippine authorities in Manila on March 27, 2015, and deported to the United States to face U.S. criminal charges.
According to the affidavit, Eccleston initially came to the attention of the FBI after he entered a foreign embassy and offered to provide classified information, which he claimed had been taken from the U.S. government. Thereafter, Eccleston met with FBI undercover employees who were posing as representatives of the foreign country, and in exchange for a promised future payment, offered to design and send spear-phishing e-mails that could be used to damage the computer systems used by his former employer and to extract sensitive information from them.
The affidavit alleges that Eccleston sent those emails to over 80 Department of Energy computers in January 2015. The FBI was able to ensure that no computer virus or malicious code was actually transmitted to the government computers.
The indictment charges Eccleston with a total of four felony offenses. These include three counts of crimes involving unauthorized access of computers. Each of the crimes, as charged, is a felony punishable by a fine or imprisonment for various terms, the longest of which is ten years. The indictment also charges Eccleston with wire fraud. Such a violation is a felony punishable by a fine or imprisonment for not more than 20 years, or both. Eccleston is charged with attempted violations of the statutes because the FBI ensured that no computer virus was actually embedded in the spear-phishing emails.
Charges contained in an indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
The investigation was conducted by the FBI’s Washington Field Office with assistance from the Nuclear Regulatory Commission and Department of Energy. The prosecution is being handled by Assistant U.S. Attorney Thomas A. Gillice of the District of Columbia. Trial Attorneys Scott Ferber and Julie A. Edelstein of the Justice Department’s National Security Division assisted in this matter.
The Department of Justice expressed appreciation to the Government of the Philippines for its assistance.
Eccleston Indictment
Former U.S. Nuclear Regulatory Commission Employee Charged with Attempted Spear-Phishing Cyber-Attack on Department of Energy ComputersRead the Press Release
WASHINGTON – An indictment has been unsealed charging Charles Harvey Eccleston, a former employee of the U.S. Department of Energy and the U.S. Nuclear Regulatory Commission (NRC), in connection with an attempted e-mail “spear-phishing” attack in January 2015, targeting dozens of Department of Energy employee e-mail accounts.
The indictment was announced today by Acting U.S. Attorney Vincent H. Cohen, Jr. of the District of Columbia; Assistant Attorney General for National Security John P. Carlin, and Assistant Director in Charge Andrew G. McCabe of the FBI’s Washington Field Office.
The indictment was unsealed, along with an earlier-filed complaint and affidavit, following Eccleston’s first appearance this afternoon in the U.S. District Court for the District of Columbia. The Court ordered that he remain detained pending a hearing set for May 20, 2015.
According to the affidavit, the goal of the attack was to cause damage to the computer network of the Department of Energy through a computer virus that Eccleston believed was being delivered to particular department employees through e-mails, and to extract sensitive, nuclear weapons-related government information that Eccleston believed would be collected by a foreign country.
An e-mail spear-phishing attack involves crafting a convincing e-mail for selected recipients that appears to be from a trusted source and that, when opened, infects the recipient’s computer with a virus. Attackers may gather personal information about their target to increase their probability of success.
“This former federal employee is charged with trying to launch a cyber-attack to steal sensitive information from the Department of Energy,” said Acting U.S. Attorney Cohen. “Thanks to an innovative operation by the FBI, no malicious code was actually transmitted to government computers. This prosecution demonstrates federal law enforcement’s vigorous efforts to neutralize cyber threats that put consumers, our economy, and our national security at risk.”
“Combating cyber-based threats to our national assets is one of our highest priorities,” said Assistant Attorney General Carlin. “As alleged in the indictment, Eccleston sought to compromise, exploit and damage U.S. government computer systems that contained sensitive nuclear weapon-related information with the intent to allow foreign nations to gain access to that material. We must continue to evolve our efforts and capabilities to confront cyber enabled threats and aggressively detect, disrupt and deter them. We are grateful for the tireless efforts of law enforcement in this case.”
“Computer intrusions are among the greatest cyber threats to our national security,” said Assistant Director in Charge McCabe. “Cyber actors have become increasingly adept at exploiting our computer networks in order to exfiltrate our nation’s secrets and valuable research. As threats to the U.S. government become increasingly complex, the FBI will continue to evolve in order to counter these threats.”
Eccleston, 62, a U.S. citizen who had been living in Davao City in the Philippines since 2011, was terminated from his employment at the U.S. Nuclear Regulatory Commission in 2010. The attack targeted computers at the Department of Energy. Eccleston was detained by Philippine authorities in Manila on March 27, 2015, and deported to the United States to face U.S. criminal charges.
According to the affidavit, Eccleston initially came to the attention of the FBI after he entered a foreign embassy and offered to provide classified information, which he claimed had been taken from the U.S. government. Thereafter, Eccleston met with FBI undercover employees who were posing as representatives of the foreign country, and in exchange for a promised future payment, offered to design and send spear-phishing e-mails that could be used to damage the computer systems used by his former employer and to extract sensitive information from them.
The affidavit alleges that Eccleston sent those emails to over 80 Department of Energy computers in January 2015. The FBI was able to ensure that no computer virus or malicious code was actually transmitted to the government computers.
The indictment charges Eccleston with a total of four felony offenses. These include three counts of crimes involving unauthorized access of computers. Each of the crimes, as charged, is a felony punishable by a fine or imprisonment for various terms, the longest of which is ten years. The indictment also charges Eccleston with wire fraud. Such a violation is a felony punishable by a fine or imprisonment for not more than 20 years, or both. Eccleston is charged with attempted violations of the statutes because the FBI ensured that no computer virus was actually embedded in the spear-phishing emails.
Charges contained in an indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
The investigation was conducted by the FBI’s Washington Field Office with assistance from the Nuclear Regulatory Commission and Department of Energy. The prosecution is being handled by Assistant U.S. Attorney Thomas A. Gillice of the District of Columbia. Trial Attorneys Scott Ferber and Julie A. Edelstein of the Justice Department’s National Security Division assisted in this matter.
The Department of Justice expressed appreciation to the Government of the Philippines for its assistance.
Former PPG Employee Charged with Theft of Trade SecretsRead the Press Release
A former PPG Industries, Inc. employee has been arrested and charged in federal court in Pittsburgh with theft of trade secrets, U.S. Attorney David J. Hickton for the Western District of Pennsylvania announced today.
The criminal complaint names Thomas Rukavina, 62, of Plum Borough, Pennsylvania.
“Theft, whether hands-on or through cyber intrusions, diminishes our competitive edge in technology and product development and deprives our citizens of economic opportunities,” stated U.S. Attorney Hickton. “We will aggressively pursue intellectual property theft regardless of who commits the crime.”
The criminal complaint alleges that Rukavina retired from PPG in July of 2012. As early as June 2014, Rukavina passed proprietary and confidential information to J.T.M.G. Co., a glass company based in Jiangsu, China, that specializes in automotive and other specialty glass. The trade secret information he passed included PPG’s manufacturing specifications for windows, which are made of synthetic plastics and used for high-speed transportation, including airplanes.
The defendant was arrested yesterday and made an initial appearance today before federal magistrate Judge Cynthia Reed Eddy. He was ordered detained pending a formal detention hearing scheduled for Monday, May 11, 2015.
The law provides for a maximum total sentence of up to ten years in prison, a fine of $250,000, or both. Under the federal sentencing guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
A criminal complaint is only a charge and is not evidence of guilt. A defendant may not be prosecuted unless, within 30 days, a grand jury has found probable cause to believe that he is guilty of an offense.
Assistant U.S. Attorney James T. Kitchen is prosecuting this case. The Federal Bureau of Investigation conducted the investigation that led to the complaint charging Rukavina.
Former PPG Employee Charged with Theft of Trade SecretsRead the Press Release
PITTSBURGH – A former PPG Industries, Inc., employee has been arrested and charged in federal court in Pittsburgh with theft of trade secrets, United States Attorney David J. Hickton announced today.
The criminal complaint names Thomas Rukavina, 62, of Plum Borough, Penn.
“Theft, whether hands-on or through cyber intrusions, diminishes our competitive edge in technology and product development, and deprives our citizens of economic opportunities,” stated U.S. Attorney Hickton. “We will aggressively pursue intellectual property theft regardless of who commits the crime.”
The criminal complaint alleges that Rukavina retired from PPG in July of 2012. As early as June 2014, Rukavina passed proprietary and confidential information to J.T.M.G. Co., a glass company based in Jiangsu, China, that specializes in automotive and other specialty glass. The trade secret information he passed included PPG’s manufacturing specifications for windows, which are made of synthetic plastics and used for high-speed transportation, including airplanes.
The defendant was arrested yesterday and made an initial appearance today before Federal Magistrate Judge Cynthia Reed Eddy. He was ordered detained pending a formal detention hearing scheduled for Monday, May 11, 2015.
The law provides for a maximum total sentence of up to 10 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
A criminal complaint is only a charge and is not evidence of guilt. A defendant may not be prosecuted unless, within 30 days, a grand jury has found probable cause to believe that he is guilty of an offense.
Assistant United States Attorney James T. Kitchen is prosecuting this case. The Federal Bureau of Investigation conducted the investigation that led to the complaint charging Rukavina.
Former Officer Sentenced in Absentia to Federal Prison in Connection with Fraudulent U.S. Army Contracts SchemeRead the Press Release
Though she failed to appear in federal court in San Antonio today, 52-year-old former U.S. Army officer Heidi Webster of Manhattan, KS, was sentenced to six years in federal prison for defrauding the United States in connection with U.S. Army contracts worth millions of dollars for medical equipment and personnel announced Acting United States Attorney Richard L. Durbin, Jr.
In addition to the prison term, Chief United States District Judge Fred Biery ordered that Webster pay $613,828 restitution and be placed on supervised release for a period of three years after completing her prison term. A warrant has been issued for Webster’s arrest.
On January 9, 2014, Webster and her co-defendant, Lawrence Fenti, a former non-commissioned officer in charge of Base Realignment and Closure issues for Brooks Army Medical Center (BAMC) radiology, pleaded guilty to one count of conspiracy and one count of bribery. Criminal acts involved in the conspiracy included intent to defraud the U.S., violate the Government conflict of interest law; commit bribery; commit wire fraud; make false claims against the United States; make false statements to federal authorities; and, commit money laundering.
By pleading guilty, the defendants admitted to conspiring together since 2007 to fraudulently secure multiple Army contracts and sub-contracts for radiology equipment and services by using Fenti’s position of influence, taking advantage of a prime contractor’s non-competitive bidding status, making false statements and fraudulent claims, as well as bribing Army personnel and Army contractors. Those contracts included a $2 million BAMC magnetic resonance imaging (MRI) contract in June 2008, a $4.9 million BAMC MRI contract in July 2008, a $633,406.69 BAMC staffing contract in September 2008, and a $336,600 MRI contract in September 2009 for Womack Army Medical Center at Fort Bragg, NC. Webster also admitted to paying Fenti thousands of dollars for his role in the overall scheme.
In September 2014, Fenti was sentenced to four years in federal prison followed by three years of supervised release for his role in the scheme.
A third defendant in this case, 43-year-old John Walter Hoffman, owner/operator of Hoffman Surgical Devices, Inc. in San Antonio, is awaiting trial on charges of conspiracy to commit wire fraud, money laundering, wire fraud and making false statements to U.S. Army authorities. Jury selection is scheduled for June 8, 2015.
This investigation was conducted by the U.S. Army Criminal Investigations Division (Army CID), the Internal Revenue Service--Criminal Investigation (IRS-CI), Defense Criminal Investigative Service (DCIS) and the Federal Bureau of Investigation (FBI). Assistant United States Attorney James Blankinship is prosecuting this case on behalf of the Government.
Former Louis Berger Group Inc. Chairman, CEO, and President Sentenced to One Year of Home Confinement, Fined $4.5 Million, for 20-Year Conspiracy to Defraud Federal GovernmentRead the Press Release
Scheme Involved International Environmental Consulting Contracts, Including Reconstruction Contracts in Afghanistan and Iraq
TRENTON, N.J. – The former president, chief executive officer, and chairman of the board of a New Jersey-based international engineering consulting company was sentenced today to 12 months of home confinement and fined $4.5 million for conspiring to defraud the U.S. Agency for International Development (USAID) with respect to billions of dollars in contracts over a nearly 20-year period, U.S. Attorney Paul J. Fishman announced.
Derish Wolff, 79, of Bernardsville, New Jersey, previously pleaded guilty before U.S. District Judge Anne E. Thompson to a superseding information charging conspiracy to defraud the government with respect to claims. Judge Thompson imposed the sentence today in Trenton federal court.
According to documents filed in this case and statements made in court:
Wolff, the former president and CEO of Morristown, New Jersey-based Louis Berger Group Inc. (LBG), and the former chairman of LBG’s parent company, Berger Group Holdings Inc. (BGH), led a conspiracy to defraud USAID by billing the agency on so-called “cost-reimbursable” contracts – including hundreds of millions of dollars of contracts for reconstructive work in Iraq and Afghanistan – for LBG’s overhead and other indirect costs at falsely inflated rates.
USAID, an independent federal government agency that advances U.S. foreign policy by supporting economic growth, agriculture, trade, global health, democracy, and humanitarian assistance in developing countries, including countries destabilized by violent conflict, awarded LBG hundreds of millions of dollars in reconstruction contracts in Iraq and Afghanistan as well as in other nations. LBG calculated certain overhead rates and charged USAID and other federal agencies these rates on cost-reimbursable contracts, which enabled LBG to pass on their overhead costs to the agency in general proportion to how much labor LBG devoted to the government contracts.
From at least 1990 through July 2009, LBG, through Wolff and other former executives, intentionally overbilled USAID in connection with these cost-reimbursable contracts. The scheme to defraud the government was carried out by numerous LBG employees at the direction of Wolff.
Wolff targeted a particular overhead rate, irrespective of what the actual rate was, and ordered his subordinates to achieve that target rate through a variety of fraudulent means. From at least as early as 1990 through 2000, Wolff ordered LBG’s assistant controller to instruct the accounting department to pad its time sheets with hours ostensibly devoted to federal government projects when it had not actually worked on such projects.
At an LBG annual meeting in September 2001, Salvatore Pepe, who was then the controller and eventually became chief financial officer (CFO), presented a USAID overhead rate that was significantly below Wolff’s target. In response, Wolff denounced Pepe, called him an “assassin” of the overhead rate and ordered him to target a rate above 140 percent, meaning that for every dollar of labor devoted to a USAID contract, LBG would receive an additional $1.40 in overhead expenses supposedly incurred by LBG.
In response, Pepe and former controller Precy Pellettieri, with Wolff’s supervision, hatched a fraudulent scheme from 2003 through 2007 to systematically reclassify the work hours of LBG’s corporate employees, including high-ranking executives and employees in the general accounting division, to make it appear as if those employees worked on federal projects when they did not. At his plea hearing on Dec. 12, 2014, Wolff admitted that Pepe and Pellettieri, at Wolff’s direction, reclassified these hours without the employees’ knowledge and without investigating whether the employees had correctly accounted for their time, and at times did so over an employee’s objection.
In addition to padding employees’ work hours with fake hours supposedly devoted to USAID work, Wolff instructed his subordinates to charge all commonly shared overhead expenses, such as rent, at LBG’s Washington, D.C., office to an account created to capture USAID-related expenses, even though the D.C. office supported many projects unrelated to USAID or other federal government agencies.
On Nov. 5, 2010, Pepe and Pellettieri both pleaded guilty before then-U.S. Magistrate Judge Patty Shwartz to separate informations charging them with conspiring to defraud the government with respect to claims. Also on that date, LBG resolved criminal and civil fraud charges related to Wolff’s and others’ conduct. The components of the settlement included:
• a Deferred Prosecution Agreement (DPA), pursuant to which the U.S. Attorney’s Office in New Jersey suspended prosecution of a criminal complaint charging LBG with a violation of the Major Fraud Statute; in exchange, LBG agreed, among other things, to pay $18.7 million in related criminal penalties; make full restitution to USAID; adopt effective standards of conduct, internal controls systems, and ethics training programs for employees; and employ an independent monitor who would evaluate and oversee the company’s compliance with the DPA for a two‑year period;
• a civil settlement that required the company to pay the government $50.6 million to resolve allegations that LBG violated the False Claims Act by charging inflated overhead rates that were used for invoicing on government contracts; and
• an administrative agreement between LBG and USAID, which was the primary victim of the fraudulent scheme.
In the settlement, the government took into consideration LBG’s cooperation with the investigation and the fact that those responsible for the wrongdoing were no longer associated with the company.
U.S. Attorney Fishman credited special agents of USAID-Office of Inspector General, under the direction of Special Agent in Charge Daniel Altman; the FBI, under the direction of Special Agent in Richard M. Frankel; the U.S. Department of Defense, Defense Criminal Investigative Service, under the direction of Special Agent in Charge Craig W. Rupert; and the former Office of the Special Inspector General for Iraq Reconstruction, under the direction of former Special Inspector General Stuart W. Bowen Jr., for the investigation leading to today’s sentencing. He also thanked the U.S. Attorney’s Office, District of Maryland, and the U.S. Department of Justice Civil Division for their roles in the case.
The government is represented by Assistant U.S. Attorneys Scott B. McBride, Deputy Chief of the U.S. Attorney’s Office’s Economic Crimes Unit, and Joyce M. Malliet of the U.S. Attorney’s Office National Security Unit.
Defense counsel: Herbert J. Stern Esq.; Mark W. Rufolo Esq.; Jeffrey Speiser Esq.; Florham Park, New Jersey
Former La Vernia Restaurant Operator and Accomplice Sentenced to Federal Prison for Immigration Document Fraud SchemeRead the Press Release
In San Antonio today, 49–year-old Yolanda Hernandez de Arteaga, the former operator of the Los Compadres Restaurant in LaVernia, TX, was sentenced to 30 months in federal prison followed by three years of supervised release for fraudulently benefiting from a financial scheme which targeted individuals seeking legitimate immigration documents announced Acting United States Attorney Richard L. Durbin, Jr. and Federal Bureau of Investigation Special Agent in Charge Christopher Combs, San Antonio Division.
Chief United States District Judge Fred Biery also sentenced Hernandez de Arteaga’s co-defendant--57–year-old Maria de Lourdes Montano-Vicencio, an undocumented alien living in Houston, to 46 months in federal prison for her role in the scheme. In addition to the prison terms, Chief Judge Biery ordered that the defendants pay $144,063 restitution to their victims.
“Hernandez de Arteaga and Montano-Vicencio twice victimized these immigrants. They first stole their money with the promise of legal papers. Then they extorted their silence with the threat of reporting them to immigration authorities,” stated Acting United States Attorney Richard L. Durbin, Jr.
According to court records, from October 2010 through December 2012, Hernandez de Arteaga and Montano-Vicencio initiated a series of financial fraud schemes including numerous incidents of wire fraud whereby they would induce vulnerable immigrants in the LaVernia area into giving them money in exchange for securing legal immigration status documents. In the schemes, the defendants claimed to have personal contacts with immigration authorities who could provide each victim with items such as a social security card, a resident alien car and a work permit in about six months-time. It was part of the scheme that the defendants did not provide any documents to the undocumented aliens. During the time of the conspiracy, the defendants collected over $100,000 from more than 60 immigrants desperate for legal immigration status documents. When the victim-immigrants became angry because they never received any documents or refunds, the defendants threatened to notify immigration authorities and facilitate the deportation of the immigrants if the victims made trouble. During the scheme, Hernandez de Arteaga wired proceeds from the scheme from LaVernia to Montano-Vicencio in Houston via Western Union or MoneyGram.
In December 2014, Hernandez de Arteaga pleaded guilty to one count of conspiracy to commit wire fraud and five substantive counts of wire fraud. In February 2013, Montano-Vicencio pleaded guilty to four counts of wire fraud.
“The defendants preyed on vulnerable victims and exploited them for profit,” said Special Agent in Charge Christopher Combs, FBI San Antonio. Detecting and bringing to justice those who perpetrate these insidious fraud schemes will always be a top priority for the FBI. ”
This case resulted from an investigation conducted by FBI agents with assistance from Homeland Security Investigations (HSI), U.S. Border Patrol and the LaVernia Police Department. Assistant United States Attorney Bettina Richardson prosecuted this case on behalf of the Government.
Former Georgia National Guard Employee Pleads Guilty to CorruptionRead the Press Release
ATLANTA - Raytosha Elliott, a former contracting official with the Georgia National Guard, has pleaded guilty to awarding contracts in exchange for illegal kickbacks. Elliott used her position to award numerous contracts under $5,000 to vendor companies created by her friends and associates.
“Ms. Elliott abused her position with the Georgia National Guard by awarding no-bid contracts to her friends in exchange for illegal kickbacks,” said Acting U.S. Attorney John Horn. “She and one friend alone pocketed nearly $75,000 in funds that were intended to maintain facilities supporting those who serve this country.”
“This guilty plea should send a message that there is a price to pay for such a betrayal of trust as seen in this case. This case also represents the FBI’s commitment to those investigations that protect the integrity of government funds and assets,” said J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office.
“The Government relies on the honesty and integrity of its officials engaged in contracting and procurement," stated John F. Khin, Special Agent in Charge, Southeast Field Office, Defense Criminal Investigative Service. “This guilty plea by a corrupt National Guard employee who misused her position was the result of DCIS' joint efforts with our Federal and State law enforcement partners to investigate corruption within the contracting process.”
“IRS Criminal Investigation will continue to provide its investigative resources and expertise in exposing fraud schemes like the one Elliott orchestrated,” said Veronica F. Hyman-Pillot, Special Agent in Charge, IRS Criminal Investigation.
“We hope this case serves as a deterrent to those who desire to pilfer the State and Federal governments’ coffers. We also believe this case exemplifies how multiple agencies can work together to achieve a common goal: to serve the public who depends on us to defend the integrity of government programs,” said Deb Wallace, State Inspector General, Georgia Office of the Inspector General.
According to Acting U.S. Attorney Horn, the charges and other information presented in court: From May 2007 through April 2012, Elliott worked for the Georgia Department of Defense, the state agency charged with coordinating and supervising all agencies and functions of the Georgia National Guard. Elliott worked as an Engineering Operations Manager out of the Clay National Guard Center, located at Dobbins Air Reserve Base, in Marietta, Georgia.
In that position, Elliott worked with engineering firms to develop bid-ready construction projects, prepared bid documents, and oversaw no-bid purchase orders. Under the rules governing the contracting process that Elliott oversaw, projects that cost less than $5,000 did not need to go through a competitive bidding process, allowing Elliott to award the contracts. She certified that the work had been completed for those projects, and facilitated payment to the vendors who allegedly completed such projects.
In that position, Elliott awarded numerous contracts under $5,000 to vendor companies created by her friends and associates, including co-defendant Lakeysha Ellis. In return, Ellis paid Elliott kickbacks, equal to 50% of the value of the contracts, for steering the contracts to Ellis’ vendor company, Total Source Solution, LLC. Elliott falsely certified that work had been completed when, in fact, it had not.
Elliott awarded Total Source Solution 17 contracts with a total value of approximately $75,000. Those contracts were for a variety of services supposedly to be performed by Total Source Solution, including electrical work, landscaping, and HVAC work. But the work was never done. Instead, the defendants split the money awarded under these contracts and spent it on personal items, including travel, meals, merchandise, and even liposuction treatment for Ellis. As part of the scheme, Elliott owned a company named Tech Group Investments, LLC. Ellis took money she had obtained from the Georgia National Guard contracts, and paid kickbacks to Elliott through this company.
Elliott and Ellis conducted a similar fraud scheme from January 2009, through May 2011, when Ellis was an accountant at Baumueller-Nuermont Corporation, an industrial equipment company with offices in Atlanta. Her job responsibilities included payroll and paying vendors. While employed as Baumueller-Nuermont’s accountant, Ellis fraudulently funneled money to the defendants’ two sham companies, Total Source Solution and Tech Group Investments. Ellis wrote corporate checks to Total Source Solution, signed her name on the checks, and forged the signature of the Vice President on the checks, to ensure that the checks could be negotiated. Ellis recorded these payments in the check registry to reflect falsely that the checks had been issued to true vendors (such as American Express) when in fact they went to Ellis’ company.
As part of the scheme, Ellis also falsified employee records in the corporation’s payroll system to disguise payments to the defendants’ two companies. Ellis created at least two phantom employees by altering the names of real employees (by switching their first and last names) and slightly changing their Social Security numbers. She then caused the payroll system to make fraudulent salary payments to Total Source Solution and Tech Group Investments for these new, non-existent employees.
Baumueller-Nuermont lost about $85,000 from this scheme.
Elliott, 35, of Atlanta, Georgia, pleaded guilty to two counts of conspiracy today. As part of her plea agreement, Elliott has also agreed to pay restitution to WebBank based on a fraudulent loan application she submitted to the bank in September 2013. In that application, Elliott falsely inflated Tech Group Investments’ sales and gross receipts, and provided a fraudulent federal tax return in support of those figures, to obtain the loan.
On March 27, 2014, Ellis, 37, of Atlanta, Georgia, pleaded guilty to two counts of conspiring with Elliott, to commit fraud against the Georgia National Guard and Baumueller-Nuermont. The indictment also charges a third defendant, Angela Thicklin (f/k/a Angela Stanback Kinlaw), 44, of Atlanta, Georgia, of conspiring with Elliott and bribing a public official. In her position at the Georgia National Guard, Elliott awarded contracts to 3M Construction LLC, which was a company owned by Thicklin. The case against Thicklin is pending trial.
Sentencing for Elliott is scheduled for August 13, 2015, at 10:30 a.m., before United States District Judge Amy Totenberg. Sentencing for Ellis has not yet been scheduled.
This case is being investigated by Special Agents of the Federal Bureau of Investigation; the Georgia Bureau of Investigation; the U.S. Department of Defense, Office of Inspector General, Defense Criminal Investigative Service; Internal Revenue Service Criminal Investigation; the U.S. Army Criminal Investigation Command; and Deputy Inspectors General of the State of Georgia Office of the Inspector General.
Assistant United States Attorney Stephen H. McClain is prosecuting the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao-ndga.
Former FCI-Greenville Inmate Sentenced for Possession of Contraband by A Federal InmateRead the Press Release
Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today that on May 7, 2015, Rodney George Plenty Hawk, Jr., 36, formerly an inmate at the Federal Correctional Institution in Greenville, IL ("FCI-Greenville"), was sentenced for Possession of Contraband by a Federal Inmate. Plenty Hawk received 18 months in federal prison, which must run consecutive (in addition) to the remainder of his current sentence, to be followed by 3 years of supervised release, and ordered to pay a $100 special assessment. Plenty Hawk has been detained since his arraignment on the Indictment on December 5, 2014.
The charge occurred on November 5, 2014, when a correctional officer at FCI-Greenville received information that Plenty Hawk might be under the influence of alcohol. Based on this information, Plenty Hawk was escorted to an area for a visual search of his person and so that he could provide a urine sample. Before the search began, Plenty Hawk told the correctional officers that he had a "shank" on his person which he subsequently turned over to the officers. The "shank" was a white plastic rod, approximately 9½ inches long, sharpened to a point at one end with a braided cord at the other end. Federal inmates are prohibited from possessing "shanks" or any type of home-made weapon, and these items are considered contraband within FCI-Greenville.
The case was investigated by the Bureau of Prison’s Special Investigations Section. The case was assigned to Assistant United States Attorney Angela Scott.
Former Columbia Resident Pleads Guilty to Receipt of Child Pornography and Possession of Prepubescent Child PornographyRead the Press Release
Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today that on May 7, 2015, Dan Stephen Daniels, 59, formerly of Columbia, IL, pled guilty to a two-count Indictment charging him, in Count 1, with Receipt of Child Pornography, and, in Count 2, Possession of Prepubescent Child Pornography. On Count 1, Daniels faces a term in federal prison of not less than five years but not more than twenty years, a fine up to $250,000, and a term of supervised release of five years to life. On Count 2, Daniels faces a prison term of not more than twenty years, a fine up to $250,000, and a term of supervised release of five years to life. Daniels’ sentencing is scheduled for October 2, 2015, in East St. Louis, Illinois. Daniels has been detained (held without bond) since his arraignment on the Indictment on February 20, 2015.
Facts revealed in Court showed that the charges arose after an undercover Internet investigation by the FBI’s Springfield Child Exploitation Task Force downloaded approximately fourteen images of child pornography between February 9, and August 5, 2014, from a computer in Illinois that was offering the images to share. An investigation traced the computer to the Daniels’ residence in Columbia, Illinois. A federal search warrant executed at the Daniels’ residence on October 17, 2014, produced an eMachines desktop computer, an Apple MacBook Pro laptop computer, and a SanDisk 4 GB thumb drive. A forensic examination of these devices revealed that these devices contained images and/or videos of child pornography, many of which involved prepubescent minors or minors who had not attained 12 years of age. The examination also revealed that, on or about October 12, 2014, Daniels downloaded and received two images of child pornography, one of a prepubescent male engaged in sexual intercourse with an adult female and the other of a prepubescent female in the lascivious display of her genitals.
During the search of his home, Daniels provided a voluntary statement to law enforcement officers in which he admitted using peer to peer programs to download and view child pornography, and provided the name of the current program that he was using. Daniels said that he had used the program as recently as October 13, 2014, to obtain child pornography. Daniels said that he would save the image and/or video files of child pornography either in a separate folder with an innocuous name such as "empty," "hard drive," or "other files," or he would save the child pornography to a thumb drive. He said that he would view the child pornography once or twice and then delete it. Daniels told the agents that he gravitated towards image and video files of children between the ages of 10 and 17, and that he used search terms commonly associated with child pornography in order to find child pornography involving younger girls.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
The case was investigated by the Columbia Police Department and the Federal Bureau of Investigation's Springfield Child Exploitation Task Force. The case is assigned to Assistant United States Attorney Angela Scott.
Former Alton Resident Sentenced for Failure to Register as A Sex OffenderRead the Press Release
Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today that on May 8, 2015, Joshua D. Kenshalo, 29, formerly of Alton, IL, was sentenced for Failure to Register as a Sex Offender. Kenshalo received 33 months in federal prison, to be followed by 10 years of supervised release, fined $250, and ordered to pay a $100 special assessment. Kenshalo has been detained since his arraignment on December 16, 2014.
Facts underlying this case were that on June 3, 2002, Kenshalo was convicted of Criminal Sexual Assault of a Family Member in Madison County. As a result of that conviction, he was required to register as a sex offender under Illinois law and the Sex Offender Registration and Notification Act. On February 26, 2014, Kenshalo was living in a halfway house in Missouri while on probation for Larceny. Because of the 2002 conviction listed above, Kenshalo was also required to register as a sex offender in Missouri.
Investigation revealed that Kenshalo had been living in Alton from February 27, 2014, when he absconded from the halfway house in Missouri, until June 10, 2014, when he was arrested. During this time period, Kenshalo never registered as a sex offender in Illinois or updated his registration information in Illinois. Kenshalo said that he did not register because he knew that he had outstanding warrants for his arrest.
The case was investigated by the Alton Police Department and the United States Marshals Service. The case was assigned to Assistant United States Attorney Angela Scott.
FBI Arrests Two Men in Murder-for-Hire PlotRead the Press Release
ATLANTA - Jorge Maturano and Cesar Santos have been arraigned on federal charges of murder-for-hire. They were arrested May 6, 2015, on a criminal complaint. Both defendants were allegedly hired to kill a member of a rival drug trafficking organization.
“These arrests demonstrate how law enforcement, working together with concerned citizens, can not only hold criminals accountable for their actions but prevent violence from occurring in our community,” said Acting U.S. Attorney John Horn.
“Our agents responded quickly to end this alleged murder plot. This case reflects the ever present potential for violence that drug trafficking organizations bring to our community and the FBI will continue to play a role in addressing them,” stated J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office.
According to Acting U.S. Attorney Horn, the complaint, and other information presented in court: Maturano and Santos were allegedly hired out of Chicago, Illinois, by a drug trafficking organization to travel to the metro Atlanta area and kill a member of a rival drug trafficking organization who was living in Clayton County, Georgia.
Jorge Maturano, 46, and Cesar Santos, 29, both of Mexico, were arrested on May 6, 2015, and both made initial appearances before United States Magistrate Judge Justin S. Anand on May 7, 2015.
Members of the public are reminded that the criminal complaint in this matter only contains charges. The defendant is presumed innocent of the charges and it will be the government’s burden to prove the defendant’s guilt beyond a reasonable doubt at trial.
This case is being investigated by the Federal Bureau of Investigation.
In that this remains an ongoing investigation, anyone with information regarding this matter should contact the FBI Atlanta Field Office at (404) 679-9000
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao-ndga.
Evansville man sentenced for possession of child pornographyRead the Press Release
PRESS RELEASE
Evansville – Josh J. Minkler, United States Attorney, announced today that Gregory R. Baumberger, 46, Evansville, was sentenced to 41 months in prison by U.S. District Chief Judge Richard L. Young following his guilty plea to possession of child pornography. This case was the result of an investigation by the Federal Bureau of Investigation Violent Crimes Task Force and the Evansville Police Department.
Law enforcement executed a search warrant at Baumberger’s Northside residence in October 2103, and confiscated two laptop computers. A forensic computer examination was performed and investigators discovered videos and images depicting sexually explicit conduct involving minors under the age of 12. Baumberger was found guilty in January of this year and sentenced today.
According to Assistant U.S. Attorney Todd S. Shellenbarger, who prosecuted the case for the government, Judge Young imposed 5 years of supervised release following Baumberger’s prison term. Baumberger must register as a sex offender, must not have unsupervised contact with minors and also must participate in a sex offender treatment program while on supervision.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006, by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorney’s Office and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals, who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resource.”
District Man Sentenced to Five Years in Prison for Events Leading to Shooting That Wounded Eight-Year-Old GirlRead the Press Release
WASHINGTON – Nathaniel Patten, 22, of Washington, D.C., was sentenced today to five years in prison for his role in events leading to a shooting that seriously wounded an eight-year-old girl, Acting U.S. Attorney Vincent H. Cohen, Jr. announced.
Patten pled guilty in November 2014, in the Superior Court of the District of Columbia, to charges of assault with intent to commit robbery while armed and unlawful possession of a firearm by a convicted felon. He was sentenced by the Honorable Rhonda Reid Winston. Following his prison term, Patten will be placed on three years of supervised release.
A co-defendant, the gunman, Karie Brown, 20, pled guilty in October 2014 to charges of aggravated assault while armed; assault with intent to rob while armed, and unlawful possession of a firearm by a convicted felon. He was sentenced in December 2014 to 16 years in prison.
According to the government’s evidence, Brown and Patten decided on the afternoon of Friday, Feb. 14, 2014 to rob an individual they believed sold marijuana. The men were armed with a .22-caliber Ruger semi-automatic pistol, which Brown was carrying. The men headed to the 1200 block of Valley Avenue SE, an area they knew that the individual had frequented.
Brown and Patten pretended to be waiting to gain access to a locked apartment building on the block. The eight-year-old girl – who was going outside to play in the snow - held the door open for them. Brown and Patten then followed the individual who they were targeting into the building as he went upstairs. They then attempted to rob him and gain access to an apartment that he was about to enter. The individual escaped and ran downstairs. Brown shot once at the individual while inside the building and then fired multiple shots at him outside.
The shots missed the individual, but hit the girl in the torso. The bullet struck inches from her heart. It caused severe bleeding, and she was rushed to an emergency room and placed in critical care. She required immediate surgery and could have died but for the timely intervention of medical assistance.
According to the government’s evidence, Brown and Patten fled together, not stopping to provide any assistance to their young victim, and Brown discarded the firearm, which was found by the Metropolitan Police Department (MPD). The defendants were both found and arrested soon after the shooting in the 3500 block of Wheeler Road SE.
In announcing the sentence, Acting U.S. Attorney Cohen commended the work of those who investigated the case from the Metropolitan Police Department. He also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Assistant U.S. Attorney Muyiwa Bamiduro; Paralegal Specialist Theresa Nelson; Victim/Witness Advocate Jennifer Clark, and Victim/Witness Security Specialist Tanya Via. Finally, he expressed appreciation for the work of Assistant U.S. Attorneys Tejpal S. Chawla and Kendra Briggs, who investigated and prosecuted the case.
District Man Sentenced to Five Years in Prison for Attempting to Buy Cocaine from Undercover Police OfficerRead the Press Release
WASHINGTON - Robert Walker, 31, of Washington, D.C., was sentenced today to five years in prison on a felony charge stemming from his attempt to buy cocaine from an undercover police officer, Acting U.S. Attorney Vincent H. Cohen, Jr. announced.
Walker pled guilty in February 2015, in the U.S. District Court for the District of Columbia, to a charge of unlawful possession with intent to distribute 500 grams or more of cocaine. He was sentenced by the Honorable Colleen Kollar-Kotelly. Upon completion of his prison term, Walker will be placed on four years of supervised release.
According to the government’s evidence, on several occasions in 2014, Walker had conversations in person and on the phone with a person who was an undercover officer from the Metropolitan Police Department (MPD) to discuss the purchase of a kilogram of cocaine. He ultimately agreed to purchase the kilogram, and on July 18, 2014, at about 7:10 p.m., he met the undercover officer in the 6000 block of Kansas Avenue NW. Walker stated that he would pay $15,000 immediately for the kilogram and pay the remaining $15,000 owed in three days.
Walker further stated that he needed until 8:30 p.m., to obtain the money. He left the area to retrieve the money. At about 8:45, he returned, showing the undercover officer a large amount of U.S. currency that he said totaled $17,000; it actually was $16,967. He gave the money to the undercover officer and was subsequently arrested. In a search of the defendant’s person, officers recovered a quantity of marijuana and crack cocaine, along with another $847 in U.S. currency. The money was seized by law enforcement.
In announcing the sentence, Acting U.S. Attorney Cohen commended the work of the officers from the Metropolitan Police Department who worked on the case. He also expressed appreciation for the assistance provided by the FBI’s Washington Field Office. Finally, he acknowledged the efforts of Assistant U.S. Attorney Emory V. Cole, who investigated and prosecuted the case.
District Man Sentenced to 28 1/2 Years in Prison for 2013 Slaying of Howard University StudentRead the Press Release
WASHINGTON – Rasdavid Lagarde, 28, of Washington, D.C., was sentenced today to a 28 ½-year prison term for a botched attempted armed robbery of two Howard University students in which one victim was killed, Acting U.S. Attorney Vincent H. Cohen, Jr. announced.
Lagarde pled guilty in February 2015, in the Superior Court of the District of Columbia, to second-degree murder while armed for the death of 22-year-old Omar Sykes and attempted armed robbery and possession of a firearm during a crime of violence for the attack on the surviving victim. He was sentenced by the Honorable Lynn Leibovitz. Upon completion of his prison term, Lagarde will be placed on five years of supervised release.
“Omar Sykes was a rising senior at Howard with a passion for serving others and a world of promise,” said Acting U.S. Attorney Cohen. “His murder impoverishes our entire community. This prison sentence ensures that Omar Sykes’s killer will spend decades behind bars for his embrace of senseless violence. This case should serve as a warning to all the young men in our city who are tempted to get something for nothing through armed robberies.”
According to the government’s evidence, on July 4, 2013, at about 11:20 p.m., Lagarde and an accomplice were in the 700 block of Fairmont Street NW. Mr. Sykes and another Howard University student were also on the block, walking ahead of them.
Lagarde’s accomplice pulled out a gun. He ran towards the student who was with Mr. Sykes, and ordered him to the ground. He struck the student in the head multiple times with the gun, hit him in the ribs, and kicked him. He then ordered the student multiple times not to look at him or Lagarde. At one point during the assault, Lagarde told the accomplice that he thought the student was looking at him. The accomplice then hit the student yet again.
During this attack, Lagarde pulled out a gun and approached Mr. Sykes to assist in the robbery. Lagarde’s accomplice ordered Mr. Sykes to the ground and tried to force him to the ground next to the other victim. As Lagarde attempted to pistol-whip Mr. Sykes, Lagarde fired his gun at Mr. Sykes. Mr. Sykes was shot by a single gunshot that traversed through his arm and into his chest. Lagarde and the accomplice then fled from Fairmont Street.
Mr. Sykes died from the gunshot wound. The other student suffered lacerations to his head, including a huge gash to his forehead that required multiple stitches to treat. He also suffered several bruised ribs.
Lagarde was arrested by the Metropolitan Police Department (MPD) on Oct. 15, 2013 for the murder of Mr. Sykes. He told detectives that the accomplice initiated the robbery. However, once the attempted robbery began, Lagarde helped with it. Lagarde admitted that he was armed with a .380 firearm, which he used during the robbery attempt. Lagarde stated that he did not intend for the gun to fire, but it did fire during a tussle with Mr. Sykes when he tried to force Mr. Sykes to the ground. No other arrests have been made in the case.
In announcing the sentence, Acting U.S. Attorney Cohen commended the work of the detectives of the Criminal Investigations Division Homicide Branch, crime scene officers, and the Third Police District of the Metropolitan Police Department, as well as Jacob Kunkle of the FBI’s Cellular Analysis Survey Team. He also expressed appreciation to those who worked on the case from the U.S. Attorney’s Office, including Marcia Rinker, James Brennan, M. Laverne Forrest, Debra Cannon, Lesley Slade, and Michael Hailey, all of the Victim/Witness Assistance Unit; Paralegal Specialist Vanessa Trent-Valentine; former Paralegal Specialists Fern Rhedrick and Marian Russell; Investigative Analyst Zachary McMenamin, Litigation Technology Specialist Jeanie Latimore-Brown, and Intern Abhi Mehta. He also praised the efforts of Assistant U.S. Attorneys Shana Fulton and Veronica Sanchez, who investigated, indicted and prosecuted the case.
Defendant Arrested Pursuant to Grand Jury IndictmentRead the Press Release
U.S. Attorney Kenneth A. Polite announced the arrest of TARAY BUTLER following his Indictment for being a felon in possession of a firearm. BUTLER was arrested on Wednesday, May 6, 2015, with assistance of the United States Marshals Service.
The Indictment charges that on October 14, 2014, BUTLER was arrested by the New Orleans Police Department and found to be in possession of a firearm with an extended magazine. BUTLER has a prior felony conviction from Orleans Parish Criminal District Court. If convicted, BUTLER faces a maximum ten years in the Bureau of Prisons, a $250,000 fine, three years of supervised release, and a $100.00 special assessment fee.
U. S. Attorney Polite reiterated that the Indictment is merely a charge and that the guilt of the defendants must be proven beyond a reasonable doubt.
U.S. Attorney Polite praised the work of the Bureau of Alcohol, Tobacco, Firearms and Explosives and the New Orleans Police Department for their work in investigating this case. Assistant United States Attorney Myles Ranier is in charge of the prosecution.
Taray Butler Indictment.pdf (1.62 MB)
Dallas Physician and His Employee Arrested for Alleged $5.2 Million Medicare Fraud SchemeRead the Press Release
A physician who ran a medical house call service business in Dallas, and an employee of that business were arrested this morning on charges related to their alleged participation in a $5.2 million health care fraud scheme.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Acting U.S. Attorney John R. Parker of the Northern District of Texas, Special Agent in Charge Mike Fields of the Department of Health and Human Services’ Office of the Inspector General’s (HHS-OIG) Dallas Regional Office, the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU), Special Agent in Charge Thomas M. Class, Sr. of the FBI’s Dallas Division and Special Agent in Charge Max Eamiguel of the U.S. Postal Service’s Office of the Inspector General’s (USPS-OIG) Southern Area Field Office made the announcement.
Hector Molina, M.D., 51, of Irving, Texas, and Blanca Mata, 46, of Forney, Texas, were charged with one count of conspiracy to commit health care fraud. In addition, Molina was charged with eight counts of health care fraud, and Mata was charged with four counts of health care fraud. Both defendants made their initial appearances before U.S. Magistrate Judge Renée Harris Toliver of the Northern District of Texas earlier today and were released on bond.
According to allegations in the indictment, Molina owned and operated Molina Medical Housecall Services in Dallas, and Mata was an employee of that business. The indictment alleges that from approximately June 2012 through January 2015, Molina and Mata conspired to defraud Medicare by billing for home visits performed by Mata, who was not a physician, as if Molina had performed the home visits. Additionally, the indictment alleges that Molina billed for home visits performed in the Dallas area while he was out of the country.
An indictment is merely an allegation and defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
This case is being investigated by HHS-OIG, the Texas Attorney General’s MFCU, the FBI and USPS-OIG, and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Northern District of Texas. The case is being prosecuted by Trial Attorney Jason Knutson of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,100 defendants who have collectively billed the Medicare program for more than $6.5 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Team (HEAT), go to: www.stopmedicarefraud.gov.
Dallas Physician and His Employee Arrested for Alleged $5.2 Million Medicare Fraud SchemeRead the Press Release
WASHINGTON – A physician who ran a medical house call service business in Dallas, and an employee of that business were arrested this morning on charges related to their alleged participation in a $5.2 million health care fraud scheme.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Acting U.S. Attorney John R. Parker of the Northern District of Texas, Special Agent in Charge Mike Fields of the Department of Health and Human Services’ Office of Inspector General’s (HHS-OIG) Dallas Regional Office, the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU), Special Agent in Charge Thomas M. Class, Sr. of the FBI’s Dallas Division and Special Agent in Charge Max Eamiguel of the U.S. Postal Service’s Office of the Inspector General’s (USPS-OIG) Southern Area Field Office made the announcement.
Hector Molina, M.D., 51, of Irving, Texas, and Blanca Mata, 46, of Forney, Texas, were charged with one count of conspiracy to commit health care fraud. In addition, Molina was charged with eight counts of health care fraud, and Mata was charged with four counts of health care fraud. Both defendants made their initial appearances before U.S. Magistrate Judge Renée Harris Toliver of the Northern District of Texas earlier today and were released on bond.
According to allegations in the indictment, Molina owned and operated Molina Medical Housecall Services in Dallas, and Mata was an employee of that business. The indictment alleges that from approximately June 2012 through January 2015, Molina and Mata conspired to defraud Medicare by billing for home visits performed by Mata, who was not a physician, as if Molina had performed the home visits. Additionally, the indictment alleges that Molina billed for home visits performed in the Dallas area while he was out of the country.
An indictment is merely an allegation and defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
This case is being investigated by HHS-OIG, the Texas Attorney General’s MFCU, the FBI and USPS-OIG, and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Northern District of Texas. The case is being prosecuted by Trial Attorney Jason Knutson of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,100 defendants who have collectively billed the Medicare program for more than $6.5 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Team (HEAT), go to: www.stopmedicarefraud.gov.
Dallas Home Builder Sentenced to 24 Months in Federal Prison and Ordered to Pay More Than $250,000 in Restitution for Defrauding Insurance CompaniesRead the Press Release
DALLAS — A residential homebuilder, who operated under the name of Park Cities Development, Inc., was sentenced yesterday by U.S. District Judge Barbara M. G. Lynn, announced Acting U.S. Attorney John Parker of the Northern District of Texas.
Edward Adrian Abraham, 56, most recently of Dallas, was sentenced to 24 months in federal prison and ordered to pay $252,078 in restitution. He pleaded guilty in April 2014 to one count of wire fraud, and he has been in custody since his arrest on related charges outlined in a federal indictment returned by a grand jury in Dallas in January 2014.
According to documents filed in the case, from February 2009 through at least July 2009, Abraham devised and executed a scheme to defraud insurance companies in connection with fraudulent insurance claims based on false claims of building materials allegedly stolen from two residential job sites in Dallas - one on Amherst Avenue and one on Drane Drive.
As part of his scheme, Abraham filed false police reports to support the fraudulent insurance claims, and he caused false and fraudulent invoices to be fabricated and faxed to insurance companies to support the claims. Abraham admitted that no building materials were stolen from either location. Because of the false and fraudulent invoices, he received $247,078 in proceeds from the insurance companies.
The FBI investigated the case. Assistant U.S. Attorney J. Nicholas Bunch prosecuted.
Certified Environmental Services, Inc. Pleads Guilty to Negligent EndangermentRead the Press Release
UTICA, NEW YORK – Certified Environmental Services, Inc. ("CES") pled guilty on May 5th to a one count misdemeanor Information charging CES with negligently releasing asbestos into the ambient air, thereby placing other persons in imminent danger of death or serious bodily injury, announced United States Attorney Richard S. Hartunian. Sentencing is scheduled for 1:00 p.m. on September 10, 2015, before U.S. District Judge David N. Hurd in Utica. CES faces maximum penalties that include probation for 5 years, restitution, and a $200,000 fine, as well as a special assessment of $125.
The admissions by CES in connection with pleading guilty included the following:
During the period of 1999 – 2007, CES was engaged in the business of, among other things, conducting air monitoring and sampling and performing laboratory analysis before, during, and at the conclusion of asbestos abatement (removal) projects. CES provided air sampling and laboratory analysis for asbestos abatements by AAPEX Environmental Services, Inc., and Paragon Environmental Services, Inc., which had performed illegal "rip and run" removals in which asbestos was stripped and removed dry, scattered and left behind in various locations throughout the work area, and was permitted to, and did, migrate outside of the facility and into the ambient air.
Asbestos is a hazardous air pollutant, and severely toxic. Medical science has not established any minimum level of exposure to asbestos fibers which is considered to be safe. Before asbestos abatement, containment structures known as isolation barriers must be constructed around the abatement area by the contractor and negative air pressure maintained to ensure that contaminated air in the abatement area does not filter back to an uncontaminated area. The containment and negative air pressure must be maintained continuously from the start of the abatement work through the cleanup operations and clearance air monitoring.
The negligence by CES that was a cause of the release of the hazardous air pollutant asbestos and the resulting imminent danger to persons involved: 1) CES employees failing in certain cases to: perform visual inspections for asbestos debris and pools of water; observe required waiting periods before sampling; record accurate sampling starting and stopping times; calibrate pumps before and after sampling; conduct aggressive air sampling (by agitating the air inside the work area to ensure that present asbestos fibers are rendered airborne for collection and measurement); and decontaminate air samplers and their equipment before leaving the asbestos work area, or sign in and out of containment; and 2) CES employees, in certain cases, conducting air sampling without entering work areas; letting contractors collect air samples themselves; and overstating sampling times.
CES thereby negligently released asbestos into the ambient air and negligently placed persons in imminent danger of death or serious bodily injury from exposure to asbestos fibers.
In 2010, a fifteen count superseding indictment charged CES and others with environmental offenses and mail fraud and a jury trial concluded with the conviction of CES (and three co-defendants) as charged. However, in 2014, the Court of Appeals reversed the convictions and remanded for a new trial. The guilty plea May 5th resolves the pending charges against CES and two co-defendants. Two other co-defendants face re-sentencing.
The case was investigated by the U.S. Environmental Protection Agency Criminal Investigation Division, New York Regional Office and Syracuse Resident Office, whose diligence and dedication U.S. Attorney Hartunian commended. It is being prosecuted by First Assistant U.S. Attorney Grant C. Jaquith.
Cattaraugus Man Convicted of Drug and Gun ChargesRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that a federal jury has found Joseph Tigano, III, 51, guilty of manufacturing in excess of 1000 marijuana plants; possession with intent to distribute marijuana; maintaining a premises for the manufacturing of marijuana; conspiracy to manufacture and possess marijuana and maintain a premises for the manufacturing of marijuana; and being a felon in possession of a firearms. The charges carry a mandatory minimum of 20 years in prison, a maximum of life and a $10,000,000 fine.
Assistant U.S. Attorney Thomas S. Duszkiewicz, who handled the prosecution of the case, stated that on July 8, 2008, law enforcement officers executed a search warrant at the defendant’s Mill St. factory. During the search, officers discovered an active hydroponic marijuana grow operation which included 1414 plants. In addition, officers seized 100 pounds of harvested and processed marijuana packaged for sale. The estimated value of the processed marijuana is between $300,000 and $500,000.
Officers also seized three firearms, United States currency, money orders, and savings bonds. Also seized were a 2007 Cadillac Escalade, a 2005 Jeep Cherokee Limited, and a 2007 Haulmark Trailer.
Tigano was arrested on July 8, 2008 along with his father, Joseph Tigano, Sr., who has also been convicted and is awaiting sentencing.
The verdict is the culmination of an investigation by the Drug Enforcement Administration, under the direction of James J. Hunt, Special Agent in Charge, New York Field Division, with the assistance of the Cattaraugus County Sherriff’s Department, under the direction of Sheriff Timothy Whitcomb, and the Southern Tier Regional Task Force, under the direction of Cattaraugus County Sheriff’s Sergeant Ronald Lott, the Federal Bureau of Investigation, the Internal Revenue Service, Criminal Investigation Division, under the direction of Shantelle P. Kitchen, Special Agent in Charge, New York Field Office, and the Erie County Sheriff’s Department Aviation Unit, under the direction of Timothy Howard.Sentencing is scheduled for August 13, 2015 at 3:00 p.m. before U.S District Judge Elizabeth A. Wolford, who presided over the trial of the case.
Broward County Tax Preparer Convicted of Preparing False Tax ReturnsRead the Press Release
After a four-day trial, yesterday a federal jury convicted Hugo Jean Joseph, 60, of Coral Springs, of eleven counts of preparing false tax returns for his clients.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, and Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), made the announcement.
As shown at trial and in court documents, Jean Joseph and co-defendant Guencia Piard a/k/a Guencia Toussaint operated Lakay Multi Services (LMS), a tax return service with locations in Pompano Beach, Naples and Fort Myers, Florida. Jean Joseph and Piard prepared and filed fraudulent tax returns on behalf of their customers during the 2006 to 2008 tax years by using false Schedule A deductions (such as those for medical and unreimbursed employee business expenses), false Schedule C expenses, false education expenses, and false credits for federal fuel tax without their clients’ knowledge or consent. By inflating their clients' deductions, expenses, education credits, and fuel tax credits, Jean Joseph and Piard attained higher tax refunds for their clients which attracted a greater volume of clients. Jean Joseph and Piard kept a portion of the fraudulently inflated tax refunds as payment for their services.
Jean Joseph and Piard prepared at least 76 false tax returns for twenty-one sets of clients for tax years 2006, 2007, and 2008. Sometimes, Jean Joseph and Piard provided clients with copies of their respective tax returns which were different from the tax returns filed with the IRS. At least 21 of the 76 tax returns filed with the IRS reported a higher tax refund than the copy of the tax return provided to the client.
The total tax loss to the IRS was $283,834.
At sentencing, which is currently set for July 22, 2015 at 1:30 pm, before U.S. District Judge Jose E. Martinez, Jean Joseph faces a maximum term of 33 years in prison.
Co-defendant Piard was sentenced on August 7, 2014 to 24 months in prison, followed by three years of supervised release, and was ordered to pay restitution of $283,834. Piard pled guilty to one count of conspiracy to defraud the United States, in violation of Title 18, United States Code, Section 371.
Mr. Ferrer commended the investigative efforts of IRS-CI. The case is being prosecuted by Assistant U.S. Attorney Laurence M. Bardfeld.
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.
British Man Sentenced to 20 Years for O'Fallon High School Student’s Overdose DeathRead the Press Release
The United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today that Richard J. Klemis, 41, a British citizen, has been sentenced to 20 years in federal prison for selling the heroin which killed 19-year-old Tyler McKinney on February 23, 2011.
Klemis was sentenced on Friday, May 8, 2015 in U.S. District Court in East St. Louis, Illinois by Judge David R. Herndon. Klemis had earlier been found guilty of nine federal charges on February 4, 2015, following an 8-day jury trial.
At Klemis’ sentence hearing, Judge Herndon described Klemis as "evil and diabolical" and called him "a one-man drug store for high school kids at a party."
Judge Herndon also noted that Klemis was "a drug predator who preyed on children who were not yet capable of making reasoned choices."
In addition to providing the heroin which killed Tyler McKinney, Klemis was also sentenced for nearly killing a second man; selling heroin to four other O’Fallon High School students; and employing a 16-year-old to assist him in distributing heroin.
"Given all the facts in this case, we were extremely pleased by this result. Klemis got far more consideration from the British Courts than he ever gave his victims. Judge Herndon’s sentence was both wise and appropriate in this case." noted United States Attorney Wigginton.
"For five years now, my office has made the prosecution of heroin dealers who ‘accidentally’ kill someone a top priority. We are in the midst of a heroin abuse epidemic, and the victims are disproportionately teenagers. I’m proud to have played a part in removing a predator like Richard Klemis from our community."
At Klemis’ sentence hearing on Friday, Tyler McKinney’s mother and stepfather each addressed Judge Herndon before he imposed sentence on Klemis. McKinney’s mother noted that at trial, many witnesses testified that Klemis often referred to Tyler McKinney as "my boy Tyler." Addressing the Court, Mrs. McKinney said, "He was my boy, your Honor. Not Richard Klemis’ ‘boy.’ I will never get to see him married. I will never see the grandchildren he might have had. Instead I had to bury him."
The investigation which resulted in Klemis’ arrest and conviction was conducted by the O’Fallon, Illinois, Police Department, the Millstadt, Illinois, Police Department, and by the Drug Enforcement Administration.
The case was tried by Assistant United States Attorney Robert L. Garrison and Special Assistant United States Attorney Jonathan S. Drucker.
Bribery Charge Brought Against Miami Building Owner/Manager in Connection with Fire Code ViolationsRead the Press Release
The owner and manager of the Miami Office Center, which leases office space and manages property at a location known as the Flagler Building Downtown, was charged today with one count of bribery.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, FBI, Miami Field Office, and Rodolfo Llanes, Chief, City of Miami Police Department (MPD), made the announcement.
Dvir Derhy, 46, of Miami, was charged by information with bribery, in violation of Title 18, United States Code, Section 666(a)(2). Derhy faces a maximum possible sentence of ten years in prison for this offense.
According to the information, the Flagler Building Downtown, located at 223 East Flagler Street, was cited for violations of the City of Miami fire code for blocking egress from the building. Derhy owned and managed the Flagler Building Downtown. Between July 18, 2014 and July 21, 2014, Derhy corruptly gave, offered, and agreed to give cash payments to another person, with the intent to influence and reward an agent or employee of the City of Miami Fire Department, in connection with the removal of these citations.
Mr. Ferrer commended the investigative efforts of the FBI Miami Area Corruption Task Force and the City of Miami Police Department Internal Affairs Section. The case is being prosecuted by Assistant U.S. Attorney Harry C. Wallace, Jr.
An information is only an accusation and the defendant is presumed innocent unless and until proven guilty in a court of law.
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.
Baltimore Man Indicted on Child Exploitation Charges in East TexasRead the Press Release
BEAUMONT, Texas — A 35-year-old Baltimore, MD man has been indicted on child exploitation charges in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Ian Christian Anderson was indicted by a federal grand jury on May 7, 2015 and charged with two counts of enticement of a minor and two counts of traveling with intent to engage in illicit sexual conduct.
According to the indictment, on Feb. 15, 2015 and Mar. 16, 2015, Anderson is alleged to have traveled from Maryland to Lumberton, Texas to engage in sexual conduct with a person he knew to be under the age of 18.
Nelson faces a minimum of 10 years in federal prison if convicted of any of the charges.
This case is being prosecuted as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case is being investigated by the Federal Bureau of Investigation the Lumberton Police Department, and the Hardin County Sheriff’s Office. This case is being prosecuted by Assistant U.S. Attorneys Joseph R. Batte and Christopher T. Tortorice.
It is important to note that an indictment should not be considered as evidence of guilt and that all persons charged with a crime are presumed innocent until proven guilty beyond a reasonable doubt.
12 Lrgp Gang Members and Associates Indicted; Charged with Narcotics TraffickingRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that a federal grand jury has indicted 12 members and associates of the LRGP Gang and charged them with possession with intent to distribute, and to distribute, 280 grams or more of crack cocaine. The charge carries a mandatory minimum of 10 years in prison, a mandatory of life, and a $10,000,000 fine.
The LRGP gang, which operates primarily in the area of Lathrop, Rother, Playter and Gibson Streets in the City of Buffalo, is alleged to be an organization engaged in violent criminal activity, including the distribution of cocaine and crack cocaine and the use of firearms.
Named in the indictment are:
• Nathaniel Myers
• Anthony Newbern
• Augustus Kidd
• Brandon Miller
• Damien Carmichael
• Erika Gray
• Judy Berry
• Ka’ron McDuffie
• Marcus Edwards
• Matthew Johnson
• Vaughn Owens
• Willielee JerniganDefendants Nathaniel Myers, Damien Carmichael and Matthew Johnson are also charged with maintaining a premises at 41 Houghton Avenue, Buffalo, NY, for the purpose of manufacturing, distributing and using crack cocaine. The charge carries a maximum penalty of 20 years in prison and a $500,000 fine.
The indictment is the culmination of an investigation by Federal Bureau of Investigation’s Safe Streets Task Force which included the Amherst Police Department; Buffalo Police Department; Bureau of Alcohol, Tobacco, Firearms, and Explosives; Cheektowaga Police Department; Erie County Sheriff’s Office; Hamburg Police Department; Lancaster Police Department; Niagara Frontier Transportation Authority; New York State Department of Correctional Services; New York State Police; U.S. Border Patrol; and U.S. Immigration and Customs Enforcement–Homeland Security Investigations.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
10th St Gang Member Sentenced on Racketeering ChargesRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that Jimmy Sessions, 28, of Buffalo, NY, who was convicted of Racketeering Influenced Corrupt Organizations (RICO) Conspiracy, was sentenced to 70 months in prison by U.S. District Judge Richard J. Arcara.
Assistant U.S. Attorneys Joseph M. Tripi and John M. Alsup, who handled the case, stated that from 2000 to 2010, the defendant was a member of the 10th Street Gang, a criminal enterprise engaged in racketeering activity. As a part of his involvement in the 10th Street Gang, Sessions, along with other members and associates of the gang, sold cocaine, crack cocaine, and other controlled substances on the West Side of Buffalo. The defendant possessed firearms with other 10th Street Gang members and conspired to distribute over five kilograms of cocaine and over 280 grams of crack cocaine as a part of the affairs of the 10th Street Gang.
All 44 defendants in this case have been convicted.
The sentencing is the culmination of an investigation on the part of Special Agents of the Federal Bureau of Investigation Safe Streets Task Force, the New York State Police, under the direction of Major Michael Cerretto, the Buffalo Police Department under the direction of Commissioner Daniel Derenda and the Bureau of Alcohol, Tobacco, Firearms, and Explosives, under the direction of Special Agent in Charge Delano A. Reid, New York Field Division.
Thursday 7 May 2015
Waterbury Man Sentenced to More Than 5 Years in Federal Prison for Distributing MethRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, and Michael J. Ferguson, Special Agent in Charge of the Drug Enforcement Administration for New England, announced that KEVIN WALLIN, 63, last residing in Waterbury, was sentenced today by Senior U.S. District Judge Alfred V. Covello in Hartford to 65 months of imprisonment, followed by five years of supervised release, for trafficking methamphetamine (“meth”).
“Meth is a highly-addictive drug that consumes its user and has ravaged other parts of the country,” stated U.S. Attorney Daly. “Federal, state and local law enforcement continue to work hard to thwart meth distribution and abuse here in Connecticut. The DEA and Connecticut State Police should be commended for disrupting this coast to coast meth trafficking operation.”
“DEA and our law enforcement partners are committed to investigating individuals and organizations that distribute methamphetamine in our communities,” said DEA Special Agent in Charge Ferguson. “Methamphetamine is an insidious drug that wreaks havoc in our communities and destroys lives.”
According to court documents and statements made in court, this matter stems from a joint investigation by the Drug Enforcement Administration and the Connecticut State Police’s Statewide Narcotics Task Force. The investigation, which included the use of court-authorized wiretaps, controlled purchases of meth, physical surveillance and the use of an undercover officer, revealed that Chad McCluskey and his girlfriend, Kristen Laschober, of California, sent shipments of meth to WALLIN over the course of approximately four years. After receiving the shipments, WALLIN distributed the drug to other dealers and also sold it to his own customers. Some of the shipments were sent on consignment with the understanding that WALLIN would pay McCluskey and Laschober with proceeds generated from his distribution of the drug.
For a time during the conspiracy, WALLIN received between one and three pounds of meth from McCluskey and Laschober on a monthly basis. On six occasions between September 2012 and January 2013, WALLIN sold meth to the undercover officer.
WALLIN has been detained since his arrest on January 3, 2013. A court-authorized search of WALLIN’s residence on that date revealed meth, drug paraphernalia and drug packaging materials.
On April 2, 2013, WALLIN pleaded guilty to one count of conspiracy to distribute 500 grams or more of a mixture and substance containing methamphetamine (“meth”).
McCluskey and Laschober pleaded guilty to the same charge and were sentenced to prison terms of 65 months and 60 months, respectively.
This matter was prosecuted by Assistant U.S. Attorneys Patrick Caruso and H. Gordon Hall.
Wakefield Woman Sentenced for Misprision of a FelonyRead the Press Release
U.S. Attorney Kenneth A. Polite announced today that LINDSEY DOOLEY, age 25, a resident of Wakefield, Louisiana, was sentenced after having previously pled guilty to misprision of a felony.
U.S. District Judge Jane Triche Milazzo sentenced DOOLEY to 3.5 years probation.
According to court documents, on May 8, 2013, while conducting a related heroin investigation, Jefferson Parish Sheriff’s Office detectives searched co-defendant STEPHEN FARRELL and DOOLEY’S residence in Metairie. During the search, detectives found a loaded Taurus International .380 caliber firearm and drug paraphernalia. FARRELL was convicted in federal court for possession of a firearm by a convicted felon, and was sentenced by Judge Milazzo to 68 months in federal prison. Court records reveal that DOOLEY concealed FARRELL’S heroin distribution activities by providing a place for FARRELL to store and package heroin.
U.S. Attorney Polite praised the work of the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Jefferson Parish Sheriff’s Office in investigating this matter. Assistant United States Attorney Nolan D. Paige was in charge of the prosecution.
Virginia-Based Defense Contractor to Pay $400,000 to Resolve False Claims Act Allegations Under Civil Settlement with United StatesRead the Press Release
The Informatics Applications Group, Inc. (TIAG) a Defense contractor based in Reston, VA, will pay $400,000 under a civil settlement with the United States Department of Justice, announced Acting United States Attorney Richard L. Durbin, Jr. The settlement resolves allegations that TIAG submitted false claims to the government in violation of the False Claims Act, 31 U.S.C. §§ 3729-3733, as well as certain other claims.
The claims submitted by TIAG were for services rendered under an Army contract for information technology services at the United States Army Medical Information Technology Center, Joint Base San Antonio – Fort Sam Houston. Pursuant to the contract, TIAG employees were provided access to USAMITC, its network, computers and other resources solely for purposes of performing work on USAMITC Information Technology systems.
The United States contends that, beginning in June 2012 and continuing through September 2012, during its performance of the USAMITC contract, certain TIAG employees utilized the USAMITC network for prohibited purposes, including to access information that they deemed to be useful to TIAG’s efforts to obtain other government contracts. The TIAG employees searched for and obtained multiple documents from the USAMITC network, including documents restricted to those with Privileged Access. The United States contends that these documents were sought for, and were used in, preparing TIAG proposals for three government Requests for Proposals, however, TIAG did not win any of those contracts. The United States contends that TIAG’s conduct placed it in default under the contract, yet it knowingly submitted false claims for payment under the contract.
The settlement agreement is not an admission of liability by TIAG.
Acting United States Attorney Durbin commended the efforts of the United States Army Criminal Investigation Division -- Major Procurement Fraud Unit which investigated the case. Assistant United States Attorney Susan Strawn handled the investigation for the Government.
U.S. Attorney’s Office Files Civil Complaint Against Heathcare Commons Inc. for Failure Re-Employ Returning ServicememberRead the Press Release
Alleges Violation of Employment Rights of Sergeant in Army National Guard
CAMDEN, N.J. – The U.S. Attorney’s Office announced today it has filed a civil complaint against a South Jersey company for failing to re-employ a former employee when she returned from a National Guard deployment, U.S. Attorney for New Jersey Paul J. Fishman announced.
The civil lawsuit, filed in Camden federal court, alleges that Healthcare Commons Inc., of Carneys Point, New Jersey, willfully violated the Uniformed Services Employment and Re-employment Rights Act of 1994 (USERRA). USERRA protects the rights of uniformed servicemembers to retain their civilian employment following absences due to military service obligations and provides that they shall not be discriminated against because of their military obligations.
“The men and women who serve in our armed forces here and abroad do so at great personal sacrifice,” U.S. Attorney Fishman said. “Because of that sacrifice, federal law guarantees that they have the opportunity to resume their careers when they’ve completed their service. When companies seek to skirt their obligations to re-employ our returning veterans, we will hold them accountable.”
“No person should lose their job for serving our country, but according to our complaint that’s exactly what happened to a National Guard member here,” Acting Associate General Stuart F. Delery said. “Today’s filing is one more example of the Department of Justice’s commitment to protecting the men and women who serve in our Armed Forces from discrimination and unlawful actions.”
“The filing of this case reinforces the commitment of the Department of Justice to the vigorously enforce the prohibition of employment discrimination based on military service,” Principal Deputy Assistant Attorney General Vanita Gupta of the Civil Rights Division, said. “I want to thank the Department of Labor for referring this case to the Department of Justice. I’m hopeful that through the department’s newly created Servicemembers and Veterans Initiative, we will continue to build on our strong ties with federal partners and continue using every tool at our disposal to protect the rights of the men and women who serve in our Armed Forces.”
According to the complaint:
Megan Toliver, 32, of New Castle, Delaware, is a former employee of Healthcare Commons. She joined the U.S. Army National Guard in September 2004 and, most recently, had served as a sergeant, with honorable service as a mental health specialist. When Toliver returned from her military deployment in May 2014, Healthcare Commons willfully violated USERRA by not re-employing her as a mental health screener or in another comparable position.
The case was referred by U.S. Department of Labor following an investigation by the department’s Veterans’ Employment and Training Service.
The plaintiff is represented by Assistant U.S. Attorney Michael E. Campion, U.S. Attorney’s Office, District of New Jersey, and Special Litigation Counsel Andrew Braniff, U.S. Department of Justice, Civil Rights Division, Employment Law Section.
In March 2015, the Attorney General created of the Service Members and Veterans Initiative, which is led by three dedicated career Justice Department attorneys with strong ties to the military community. They will further the Department’s existing efforts by coordinating and expanding enforcement, outreach, and training efforts on behalf of service members, veterans, and their families. The initiative will address the unique challenges that service members face while on active duty, that veterans face upon returning home, and that families face when a loved one is deployed.
Additional information about USERRA can be found on the U.S. Attorney’s Office website at www.justice.gov/usao-nj and the Justice Department’s websites at www.usdoj.gov/crt/emp and www.servicemembers.gov, as well as on the Labor Department’s website at www.dol.gov/vets/programs/userra/main.htm.
U.S. Attorney Hartunian, New York Attorney General Schneiderman & Comptroller DiNapoli Announce Guilty Pleas on State and Federal Charges by Former AssemblymemberRead the Press Release
Former New York State Assemblymember William Scarborough, 69, of Queens, New York, has agreed to plead guilty on federal and state charges stemming from public corruption investigations, announced U.S. Attorney Richard S. Hartunian of the Northern District of New York, Attorney General Eric T. Schneiderman of the State of New York, State Comptroller Thomas P. DiNapoli of New York and Special Agent in Charge Andrew W. Vale of the FBI’s Albany Division.
Scarborough pleaded guilty this morning to federal charges and is scheduled to plead guilty to state charges at 12:30 p.m. in Albany, New York, County Court.
Appearing in federal court before Senior U.S. District Judge Thomas J. McAvoy of the Northern District of New York, Scarborough pleaded guilty to wire fraud and theft concerning a program receiving federal funds. Scarborough is scheduled to be sentenced on Monday, Sept. 14, 2015, at 11:30 a.m., in Albany. He faces up to 20 years in prison on the wire fraud count, 10 years in prison on the count charging theft concerning a program receiving federal funds and fines of up to $250,000 on each count. As part of the plea agreement, Scarborough also agreed to resign his position as a member of the New York State Assembly, pay $54,355 in restitution to the State of New York and forfeit that amount to the United States.
This afternoon, Scarborough will appear before Judge Stephen W. Herrick of the Albany County Court to plead guilty to a public corruption charge related to the misuse of over $40,000 from his Friends of Bill Scarborough campaign account. As part of the plea agreement, Scarborough will plead guilty to grand larceny in the fourth degree and is expected to be sentenced to one year of jail time, will resign his position in the State Assembly and will donate all funds remaining in his campaign account to charity.
The federal charges and guilty plea arose from an investigation into travel voucher fraud. As a New York State Assemblymember, Scarborough was entitled to receive the following types of payments when he traveled to Albany for legislative business: an allowance for overnight stays in Albany (full per diem), which varied from $160 to $171 per day, an allowance for travel not requiring an overnight stay in Albany (partial per diem), which varied from $49 to $61 per day and reimbursement for mileage actually incurred for travel between his home and Albany. To receive those payments, Scarborough was required to submit travel vouchers to the New York State Assembly Finance Department certifying his dates of travel to and from Albany, the number of miles he traveled to and from Albany, the purpose of his travel, the days he was in Albany and his eligibility for payment for either full per diem or partial per diem on each of those days. He also had to certify that the claimed amount was “just, true and correct.”
As part of his federal plea, Scarborough admitted that from January 2009 through December 2012 he submitted 174 fraudulent New York State Assembly travel vouchers to the assembly’s Finance Department causing the State of New York to pay him $54,355 that he was not entitled to receive. In the fraudulent vouchers, Scarborough falsely certified that he had been in Albany for legislative business on specific days when he had not been in Albany at all, had been in Albany, for less time than he claimed on a voucher, or had not stayed overnight.
The state charges arose from an ongoing effort between Schneiderman and DiNapoli known as “Operation Integrity” and conducted with the FBI’s Public Corruption Task Force. In his state plea agreement, Scarborough will admit that between January 2007 and March 2014, he stole from the Friends of Bill Scarborough campaign committee by making over $38,000 in unauthorized cash withdrawals and transfers from his campaign account for his own personal use and taking checks totaling $3,450 which were intended as donations to the Friends of Bill Scarborough campaign and instead depositing them directly into his personal bank. In furtherance of this scheme, Scarborough will admit that, over the seven year period, he caused his campaign committee to file 21 false reports to the New York State Board of Elections that failed to reflect these larcenies.
“My office is committed to rooting out corruption in the state legislature, without regard to party, position, power or popularity,” said U.S. Attorney Hartunian. “There is no delight in the downfall of a duly elected representative, but Mr. Scarborough chose personal gain over the public trust. Complaints of financial distress – something many people experience – provide a poor excuse for Mr. Scarborough’s misconduct, which involved a four year scheme to defraud by abusing the New York State Assembly’s travel voucher system. He falsely obtained $54,355, and now must face the consequences of his actions. I commend the Federal Bureau of Investigation, the Office of New York State Attorney General Eric Schneiderman and the Office of New York State Comptroller Thomas DiNapoli for their outstanding work and collaborative efforts here. This case is the result of interagency cooperation at its best.”
“Today Assemblymember Scarborough pleaded guilty to crimes that betrayed his constituents and the taxpayers of the State of New York – crimes that will send him to jail under this plea agreement,” said Attorney General Schneiderman. “While he will pay the price for his individual crimes, we need to channel public outrage at the ongoing corruption scandals into a movement for comprehensive reform. We have done this before in New York, and we can do it again.”
The Attorney General’s Office thanked the FBI and the U.S. Attorney’s Office of the Northern District of New York for their collaboration on this case.
“Public service means just that: serving the public,” said Comptroller DiNapoli. “Mr. Scarborough abused his public office for personal gain and now faces the consequences of his actions. I commend Attorney General Schneiderman, U.S. Attorney Hartunian and the Federal Bureau of Investigation for their commitment and for our continued partnership in rooting out corruption and protecting public funds.”
“American taxpayers deserve honesty from public officials,” said Special Agent in Charge Vale. “Those involved in acts of corruption and blatant greed will be held accountable for their actions and we will continue to pursue those like Mr. Scarborough who sell their integrity at the public’s expense.”
The federal case was investigated by the FBI’s Albany Division and is being prosecuted by Assistant U.S. Attorney Jeffrey C. Coffman of the Northern District of New York.
Prosecuting the state case is Assistant Attorney General Christopher Baynes of the Attorney General’s Public Integrity Bureau. The state’s investigation was handled by Investigator Mark Spencer and Deputy Bureau Chief Antoine Karam of the Investigation Bureau. Forensic Auditor Jason Blair and Legal Analyst Sara Pogorzelski provided additional assistance.
The New York State Comptroller’s Division of Investigations conducted the investigation for Comptroller DiNapoli's Office.
U.S. Attorney Hartunian, New York A.G. Schneiderman & Comptroller Dinapoli Announce Guilty Pleas on State and Federal Charges by Former Assembly Member William ScarboroughRead the Press Release
ALBANY, NEW YORK – United States Attorney Richard S. Hartunian, New York State Attorney General Eric T. Schneiderman, State Comptroller Thomas P. DiNapoli, and Andrew W. Vale, Special Agent in Charge of the Albany Division of the Federal Bureau of Investigation, today announced that former New York State Assemblymember WILLIAM SCARBOROUGH, age 69, of Queens, New York, has agreed to enter guilty pleas on federal and state public charges stemming from public corruption investigations.
SCARBOROUGH pled guilty this morning to federal charges and is scheduled to plead guilty to state charges at 12:30 p.m. in Albany County Court.
Appearing in federal court before Senior United States District Judge Thomas J. McAvoy, SCARBOROUGH pled guilty to wire fraud and theft concerning a program receiving federal funds. SCARBOROUGH is scheduled to be sentenced on Monday, September 14, 2015, at 11:30 a.m., in Albany, New York. He faces up to 20 years in prison on the wire fraud count, 10 years in prison on the count charging theft concerning a program receiving federal funds, and fines of up to $250,000 on each count. As part of the plea agreement, SCARBOROUGH also agreed to resign his position as a Member of the New York State Assembly, pay $54,355 restitution to New York State, and forfeit that amount to the United States.
This afternoon, SCARBOROUGH will appear before Albany County Court Judge Stephen W. Herrick to plead guilty to a public corruption charge related to the misuse of over $40,000 from his Friends of Bill Scarborough campaign account. As part of a plea agreement, SCARBOROUGH will plead guilty to Grand Larceny in the 4th Degree and is expected to be sentenced to one year of jail time, will resign his position in the State Assembly, and will donate all funds remaining in his campaign account to charity.
The federal charges and guilty plea arose from an investigation into travel voucher fraud. As a New York State Assembly Member, SCARBOROUGH was entitled to receive the following types of payments when he traveled to Albany for legislative business: (a) an allowance for overnight stays in Albany ("full per diem"), which varied from $160 to $171 per day; (b) an allowance for travel not requiring an overnight stay in Albany ("partial per diem"), which varied from $49 to $61 per day; and (c) reimbursement for mileage actually incurred for travel between his home and Albany. To receive those payments, SCARBOROUGH was required to submit travel vouchers to the New York State Assembly Finance Department certifying his dates of travel to and from Albany; the number of miles he traveled to and from Albany; the purpose of his travel; the days he was in Albany; and his eligibility for payment for either full per diem or partial per diem on each of those days. He also had to certify that the claimed amount was "just, true, and correct."
As part of his federal plea, SCARBOROUGH admitted that from January 2009 through December 2012 he submitted 174 fraudulent New York State Assembly Travel Vouchers to the Assembly Finance Department causing New York State to pay him $54,355 that he was not entitled to receive. In the fraudulent vouchers, SCARBOROUGH falsely certified that he had been in Albany for legislative business on specific days when he had not been in Albany at all, had been in Albany for less time than he claimed on a voucher, or had not stayed overnight.
The state charges arose from an ongoing effort between Schneiderman and DiNapoli known as "Operation Integrity" and conducted with the FBI Public Corruption Task Force. In his state plea agreement, SCARBOROUGH will admit that between January of 2007 and March of 2014, he stole from the "Friends of Bill Scarborough" campaign committee by making over $38,000 in unauthorized cash withdrawals and transfers from his campaign account for his own personal use, and taking checks totaling $3,450 which were intended as donations to "Friends of Bill Scarborough" and instead depositing them directly into his personal bank. In furtherance of this scheme, SCARBOROUGH will admit that, over the seven year period, he caused his campaign committee to file twenty-one false reports to the New York State Board of Elections that failed to reflect these larcenies.
U.S. Attorney Richard S. Hartunian said, "My office is committed to rooting out corruption in the state legislature, without regard to party, position, power, or popularity. There is no delight in the downfall of a duly elected representative, but Mr. Scarborough chose personal gain over the public trust. Complaints of financial distress -- something many people experience -- provide a poor excuse for Mr. Scarborough’s misconduct, which involved a four year scheme to defraud by abusing the New York State Assembly’s travel voucher system. He falsely obtained $54,355, and now must face the consequences of his actions. I commend the Federal Bureau of Investigation, the Office of New York State Attorney General Eric Schneiderman, and the Office of New York State Comptroller Thomas DiNapoli for their outstanding work and collaborative efforts here. This case is the result of interagency cooperation at its best."
"Today Assemblymember Scarborough pleaded guilty to crimes that betrayed his constituents and the taxpayers of the State of New York--crimes that will send him to jail under this plea agreement," said Attorney General Eric T. Schneiderman. "While he will pay the price for his individual crimes, we need to channel public outrage at the ongoing corruption scandals into a movement for comprehensive reform. We have done this before in New York, and we can do it again." The Attorney General’s Office thanked the Federal Bureau of Investigation and the United States Attorney’s Office for the Northern District of New York for their collaboration on this case.
"Public service means just that: serving the public. Mr. Scarborough abused his public office for personal gain and now faces the consequences of his actions," said Comptroller Thomas P. DiNapoli. "I commend Attorney General Schneiderman, U.S. Attorney Hartunian, and the Federal Bureau of Investigation for their commitment and for our continued partnership in rooting out corruption and protecting public funds."
"American taxpayers deserve honesty from public officials," said Special Agent in Charge Andrew W. Vale. "Those involved in acts of corruption and blatant greed will be held accountable for their actions, and we will continue to pursue those like Mr. Scarborough who sell their integrity at the public’s expense."
The federal case was investigated by the Federal Bureau of Investigation, Albany Division, and is being prosecuted by Assistant United States Attorney Jeffrey C. Coffman.
Prosecuting the state case is Assistant Attorney General Christopher Baynes of the Attorney General’s Public Integrity Bureau, which is led by Deputy Bureau Chief Stacy Aronowitz and Bureau Chief Daniel Cort. Kelly Donovan is the Executive Deputy Attorney General for Criminal Justice. The state’s investigation was handled by Investigator Mark Spencer and Deputy Bureau Chief Antoine Karam of the Investigation Bureau, which is led by Chief Dominick Zarrella. Forensic auditor Jason Blair and legal analyst Sara Pogorzelski provided additional assistance.
The State Comptroller’s Division of Investigations conducted the investigation for Comptroller DiNapoli's Office.
Two Plead Guilty to Sex Trafficking of a MinorRead the Press Release
FRESNO, Calif. — Fresno residents Michael Anthony Andrade, 34, and Javier Solis, 29, pleaded guilty today to sex trafficking of a minor, United States Attorney Benjamin B. Wagner announced.
According to court documents, Andrade and Solis forced two girls, ages 15 and 17, to prostitute themselves first in Fresno and then in San Luis Obispo. In addition, the 15‑year-old girl was taken to a tattoo parlor in Fresno where the defendants’ nicknames were tattooed on her, one name on each shoulder.
Court documents further reflect the 17-year-old, a runaway, spoke with Fresno Police officers on October 24, 2013, after her mother brought her home from San Luis Obispo. While being interviewed, she told officers about the 15-year-old who was still in San Luis Obispo under the control of the defendants as well as the motel where she was staying. In response, the San Luis Obispo Police Department was contacted, and officers were able to successfully remove her from that location.
Solis is scheduled to be sentenced on August 10, 2015, and Andrade is scheduled to be sentenced on August 17, 2015. Each faces a sentence of 10 years to life in prison and a $250,000 fine. The actual sentences, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
This case is the product of an investigation by the Federal Bureau of Investigation, the Fresno Police Department, the San Luis Obispo Police Department and the San Luis Obispo District Attorney’s Office. Assistant United States Attorneys Michael Frye and Mia Giacomazzi are prosecuting the case.
Two Men Sentenced to Prison for Fraudulent Loan SchemeRead the Press Release
CHARLOTTE, N.C. – On Wednesday, May 6, 2015, U.S. District Judge Robert J. Conrad, Jr. sentenced to prison two men for their role in a scheme involving more than $1 million in fraudulent automobile and personal loans, announced Jill Westmoreland Rose, Acting U.S. Attorney for the Western District of North Carolina.
Shawn Davis, 44, of Huntersville, N.C. and Darren Eugene Littles, 47, of Charlotte, were sentenced to 30 months and 27 months in prison, respectively, followed by a three years of supervised release. Judge Conrad also ordered Littles to pay $394,784.50 and Davis $45,284.04 as restitution. Davis and Littles each pleaded guilty to one count of bank fraud conspiracy and one count of financial institution fraud.
Acting U.S. Attorney Rose is joined in making today’s announcement by Russell F. Nelson, Special Agent in Charge of the United States Secret Service, Charlotte Field Division.
Two additional defendants charged in connection with the scheme were sentenced on March 30, 2015.Kimberly Arnell Cureton, 45, of Rock Hill, S.C. was sentenced to 24 months in prison and one year of supervised release.She pleaded guilty to aggravated identity theft.Kevin Lamone Desmore, 43, of Durham, N.C., was sentenced to 15 months in prison and three years of supervised release.Desmore pleaded guilty to bank fraud conspiracy and making a false statement on a loan application.
According to filed court documents and yesterday’s court proceedings, the defendants conspired with each other and obtained automobile and personal loans from financial institutions by lying on the loan applications and submitting false or forged information and documentation to support the fraudulent loan packages.Court records indicate that, at times, the loan packages contained inflated prices for the automobiles to be purchased and, in many instances, the loan applicants failed to make the required loan payments but attempted to keep the funds obtained as a result of the fraudulent loan applications.
According to court records, Littles was the primary facilitator of the conspiracy.Littles recruited individuals to submit fraudulent loan applications, contacted financial institutions and submitted the fraudulent loan packages and, at times, used stolen identities of individuals or impersonated other people to facilitate the fraud.Littles received a commission based on the fraudulent auto loans deals.Court records indicate that Davis’ role in the conspiracy was to create fraudulent tax documents to support the loan applications, including fake W2s, tax returns and tax earning statements, among other things.Court records show that Davis has a previous federal conviction in connection with a 2000 investigation into bank fraud.
According to court records, Cureton served as a “credit scrubber,” who helped improve applicants’ negative credit scores, and Desmore worked as a recruiter of individuals whose information was used to fill out the fraudulent applications.On some occasions, Desmore even created fake residential leases to support the loan applications.According to court records, between 2008 and 2011 the conspirators obtained and attempted to obtain more than $1 million dollars in automobile and personal loans as a result of the conspiracy.
In handing down the two sentences, Judge Conrad noted that Davis had continued to engage in fraudulent conduct, and that Littles was “a leader in the conspiracy who facilitated the obtaining of fraudulent loans.”
The defendants were released on bond following the sentencing hearing.They will be ordered to report to the Federal Bureau of Prisons upon designation of a federal facility, to begin serving their sentences.All federal sentences are served without the possibility of parole.
The U.S. Secret Service investigated the case.Assistant U.S. Attorney Kenneth Smith was in charge of the prosecution.