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Tuesday 21 April 2015
Michagan Man Sentenced for Role in Access Device FraudRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051
BUFFALO, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that Deantuan Wiley, 26, of Southfield, MI., who was convicted of possessing more than 15 counterfeit access devices with intent to defraud, was sentenced to 30 months in prison by U.S. District Judge Richard J. Arcara. In addition, Judge Arcara ordered the defendant to make restitution to several victim banks totaling $6,406.Assistant U.S. Attorney John E. Rogowski, who handled the case, stated that Wiley and three companions were found to be in possession of 110 counterfeit access devices when the defendants were subjected to a customs inspection at the Lewiston Bridge on July 3, 2013. The fraudulent devices included Visa and MasterCard credit cards and gift cards that were purchased with counterfeit credit cards. The defendant, along with co-defendants George Brown, Rodney Gilliam, and Raina Johnson, used several counterfeit access devices to make, and attempt to make, purchases of gift cards and merchandise in several stores in Connecticut, Rhode Island, Pennsylvania and New York. After finding the counterfeit access devices in the car driven by Wiley, Department of Homeland Security agents obtained store security films which captured all four defendants making numerous purchases with counterfeit access devices.
Brown and Gilliam have also been convicted. Charges are pending against Johnson. The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
The sentencing is the culmination of an investigation by of Special Agents of Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Acting Special Agent in Charge J. Michael Kennedy.Miami-Dade Resident Charged for Threatening to Destroy a Local IRS BuildingRead the Press Release
A Miami-Dade County resident was charged for threatening to destroy the Internal Revenue Service (IRS) building by fire or a bomb.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Melissa Chedotal, Special Agent in Charge, Treasury Inspector General for Tax Administration (TIGTA), Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), and members of the South Florida Joint Terrorism Task Force (JTTF), made the announcement.
Morris R. Whitehead, 53, of Miami, was charged by complaint, with willfully making a threat through the use of a telephone concerning an attempt to be made to unlawfully damage or destroy a building by means of fire or an explosive, in violation of Title 18, United States Code, Section 844(e). The charge is punishable by a maximum sentence of ten years in prison.
According to allegations contained in the affidavit in support of a criminal complaint, Whitehead called the FBI’s Miami Field Office on April 20, 2015, and indicated that the IRS Building in Miami, Florida should be evacuated within two hours because it was going to go up in smoke. Whitehead was arrested later that same day and allegedly admitted to law enforcement officers that he had placed the threatening call.
“Threats to federal buildings are taken extremely seriously and we will continue to prosecute to the fullest extent of the law any attempts to disrupt the proper functioning of government and endanger the community,” stated United States Attorney Wifredo A. Ferrer.
Whitehead is scheduled to be arraigned on May 5, 2015.
Mr. Ferrer commends the outstanding investigative efforts of the South Florida Joint Terrorism Task Force, including the FBI, TIGTA, IRS-CI, U.S. Secret Service, Bureau of Alcohol, Tobacco, Firearms and Explosives, Federal Protective Services, and City of Miami Police Department. The case is being prosecuted by Assistant United States Attorney Adam Fels.
A complaint is only an accusation and a defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Miami-Dade County Resident Pleads Guilty in Identity Theft Fraud Scheme Involving $322,000 in Cashed Tax Refund ChecksRead the Press Release
A Miami-Dade County resident pled guilty for his participation in an identity theft fraud scheme involving $322,000 in cashed tax refund checks.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), and Paula A. Reid, Special Agent in Charge, U.S. Secret Service (USSS), Miami Field Office, made the announcement.
Eldridge Nichols, 41, of Miami, pled guilty to one count of theft of government money. As part of his plea agreement, Nichols agreed to pay restitution in the amount of approximately $322,000.
According to court documents, from February 2011 to January 2012, Nichols had access to and control over a bank account in the name of Eldridge Nichols LLC in Miami, Florida. Nichols caused fraudulent tax refund checks to be deposited into this account. Approximately forty-three U.S. Treasury tax refund checks, totaling approximately $322,000, were cashed through this bank account. Nichols used the proceeds from the fraudulent tax refund checks for travel, clothing, entertainment, and other personal purposes.
Law enforcement contacted a sample of individuals who had a tax refund check in their name cashed in this account. All of the individuals advised that they did not know of the defendant, that they did not authorize Nichols to have possession of a tax refund check in their name, and that they did not personally receive any of the proceeds from this unauthorized tax refund.
Nichols is scheduled to be sentenced before U.S. District Court Judge Cecilia M. Altonaga on June 29, 2015 at 9:30 a.m. At sentencing, Nichols faces a maximum of ten years in prison.
Mr. Ferrer commended the investigative efforts of IRS-CI and the USSS. This case is being prosecuted by Assistant U.S. Attorney Michael N. Berger.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Miami-Dade County Man Sentenced for Identity Theft Tax Fraud Scheme Involving the Unauthorized Use of Debit CardsRead the Press Release
A Miami-Dade County man was sentenced to 24 months in prison, followed by 3 years of supervised release, and was ordered to pay $5,855 in restitution, for his participation in a stolen identity tax fraud scheme.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), and Paula A. Reid, Special Agent in Charge, U.S. Secret Service (USSS), Miami Field Office, made the announcement.
Duniel Gongora, 28, previously pled guilty to one count of using unauthorized access devices and one count of aggravated identity theft.
According to court documents, from February 24, 2014 through March 4, 2014, Gongora knowingly used two debit cards that belonged to other people with the intent to defraud. Gongora knew that both debit cards were funded with fraudulent tax refunds. Gongora used the debit cards at various ATMs in Miami-Dade County and withdrew funds totaling over $1,000. Gongora knew that the debit card numbers belonged to real people and that the victims did not authorize him to possess their personal information or to use debit cards in their names.
Mr. Ferrer commended the investigative efforts of FBI, IRS-CI, and USSS. This case was prosecuted by Assistant U.S. Attorney Vanessa Snyder.
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.
Meraux Man Pleads Guilty to Conspiracy Related to Falsifying Records for Gun PurchaseRead the Press Release
U.S. Attorney Kenneth A. Polite announced that RICKEY COLEMAN, age 26, of Meraux, pled guilty yesterday to one count of conspiring to falsify ATF records related to the purchase of a firearm.
According to the factual basis filed in open court, COLEMAN enlisted the help of two other individuals to aid in the purchase of a firearm from Academy Sports in Elmwood on June 9, 2013. COLEMAN was a previously convicted felon and prohibited from buying a firearm. The female who purchased the firearm falsified an ATF form regarding the true ownership of the firearm.
COLEMAN faces a sentence of up to five years in prison, followed by up to three years of supervised release, and up to $250,000 in fines. U.S. District Judge Sarah S. Vance set sentencing for August 5, 2015.
U.S. Attorney Polite praised the work of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) in investigating this matter along with the assistance of the St. Bernard Sheriff’s Office. Assistant United States Attorney Edward J. Rivera is in charge of the prosecution.
Rickey Coleman Factual Basis
Member of Drug Trafficking Organization Admits Conspiring to Sell Heroin in New JerseyRead the Press Release
TRENTON, N.J. – A South Jersey woman who was a member of a large-scale drug trafficking organization today admitted distributing more than 100 grams of heroin, U.S. Attorney Paul J. Fishman announced.
Dawn Rosser, 34, of Lakewood, New Jersey, pleaded guilty before U.S. District Judge Peter G. Sheridan in Trenton federal court to an information charging her with one count of conspiring to distribute heroin.
In March 2014, 20 other alleged members of the drug trafficking organization of which Rosser was a member were charged by criminal complaint with conspiring to distribute heroin. The complaint referred to the drug trafficking organization as the “Britt-Young DTO,” after its leaders, Robert Britt, a/k/a “True,” and Rufus Young, a/k/a “Equan,” a/k/a “E-Money,” a/k/a “Kintock.” Of those individuals, nine have pleaded guilty.
According to documents filed in this case and statements made in court:
Between February 2013 and March 2014, Rosser conspired with others to distribute heroin in Ocean and Monmouth counties. Rosser admitted distributing between 100 and 400 grams of heroin.
The narcotics conspiracy charge to which Rosser pleaded guilty carries a maximum penalty of 20 years in prison and $1 million fine. Sentencing is scheduled for June 5, 2015.
U.S. Attorney Fishman credited special agents of the FBI, Red Bank Resident Office, under the direction of Special Agent in Charge Richard M. Frankel, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Nicholas Grippo of the U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel: Joseph Accardi Esq., Elizabeth, New Jersey
rosser_dawn_information.pdf
Member of Drug Trafficking Organization Admits Conspiring to Sell HeroinRead the Press Release
TRENTON, N.J. – A Toms River, New Jersey, man today admitted distributing heroin and cocaine as part of a large-scale drug trafficking organization that operated in Monmouth, Ocean, and Middlesex counties, U.S. Attorney Paul J. Fishman announced.
Delovi R. Canales, a/k/a “Butter,” 48, pleaded guilty before U.S. District Judge Anne E. Thompson in Trenton federal court to an information charging him with one count of conspiring to distribute heroin.
In October 2014, 20 other alleged members of the drug trafficking organization of which Canales was a member were charged by criminal complaint with conspiring to distribute heroin. The complaint referred to the drug trafficking organization as the “Cadet DTO,” after one of its leaders, Herve Cadet, a/k/a “Gotti,” a/k/a “Bro,” 29, of Neptune and Sayreville, New Jersey.
According to documents filed in this case and statements made in court:
From November 2013 through October 2014, Cadet, Eric Smith, a/k/a “EV,” a/k/a “E,” 42, of Manchester, New Jersey, and the other members of Cadet DTO, including Canales, conspired to sell illegal drugs – chiefly heroin – in Monmouth, Ocean and Middlesex counties. Through the use of confidential informants, authorized interception of cell phone calls and other means, law enforcement learned Cadet and Smith were responsible for identifying sources of heroin supply and oversaw distributors and other conspirators who sold, packaged and stored the drugs. Members used stash houses, spoke in code and used Haitian Creole to avoid detection by law enforcement.
The narcotics conspiracy charge to which Canales pleaded guilty carries a maximum penalty of 20 years in prison and $1 million fine. Sentencing is scheduled for June 27, 2015.
U.S. Attorney Fishman credited special agents of the DEA, Newark Division, under the direction of Special Agent in Charge Carl J. Kotowski and officers of the Monmouth County Prosecutor’s Office, under the direction of Acting Prosecutor Christopher J. Gramiccioni with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Fabiana Pierre-Louis of the U.S. Attorney’s Office Criminal Division in Trenton.
Defense Counsel: David R. Oakley Esq., Princeton, New Jersey
Major Cocaine and Heroin Trafficker Pleads Guilty, Agrees to Forfeit Love and Hip Hop Income and Other AssetsRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051
ROCHESTER, N.Y.- U.S. Attorney William J. Hochul, Jr. announced today that Mendeecees Harris, 36, of the Bronx, NY, pleaded guilty before U.S. District Judge Frank P. Geraci, Jr. to conspiracy to distribute and possess with intent to distribute 100 grams or more of heroin and 500 grams or more of cocaine. The charges carry a mandatory minimum penalty of five years in prison, a maximum 40 years, a fine of $5,000,000.00, or both. The defendant also agreed to the forfeiture of assets totaling at least $100,000 which represents proceeds from the drug trafficking conspiracy.Assistant U.S. Attorney Frank H. Sherman, who is handling the case, stated that the defendant participated in a conspiracy to distribute heroin and cocaine from 2005 until August 2012. Harris admitted that, from at least 2006 through 2008, in New York City, he participated in the distribution of quantities of heroin and cocaine with others to individuals who were transporting the drugs to Rochester and distributing them. At least 40 kilograms of cocaine and a kilogram of heroin were involved in this conduct.
The defendant, who has been appearing recently as a cast member of the VH-1 television show, Love and Hip Hop, New York, agreed to forfeit all of his income from that show and personal appearances while he is awaiting sentencing in this case. Harris agreed to forfeit all of that income, amounting to at least $100,000 cash, as well as a 2011 Audi R8 vehicle, as substitute assets representing proceeds of his illegal activities.
The plea is the culmination of an investigation on the part of Special Agents of the Drug Enforcement Administration, under the direction of Special Agent in Charge James J. Hunt, New York Field Division, investigators with the Rochester Police Department, under the direction of Chief Michael Ciminelli, and Special Agents of the Internal Revenue Service, Criminal Investigation Division, under the direction of Shantelle P. Kitchen, Special Agent in Charge, New York Field Office.
Sentencing is scheduled for August 31, 2015, at 3:00 p.m. before Judge Geraci.
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051
ROCHESTER, N.Y.- U.S. Attorney William J. Hochul, Jr. announced today that Mendeecees Harris, 36, of the Bronx, NY, pleaded guilty before U.S. District Judge Frank P. Geraci, Jr. to conspiracy to distribute and possess with intent to distribute 100 grams or more of heroin and 500 grams or more of cocaine. The charges carry a mandatory minimum penalty of five years in prison, a maximum 40 years, a fine of $5,000,000.00, or both. The defendant also agreed to the forfeiture of assets totaling at least $100,000 which represents proceeds from the drug trafficking conspiracy.Assistant U.S. Attorney Frank H. Sherman, who is handling the case, stated that the defendant participated in a conspiracy to distribute heroin and cocaine from 2005 until August 2012. Harris admitted that, from at least 2006 through 2008, in New York City, he participated in the distribution of quantities of heroin and cocaine with others to individuals who were transporting the drugs to Rochester and distributing them. At least 40 kilograms of cocaine and a kilogram of heroin were involved in this conduct.
The defendant, who has been appearing recently as a cast member of the VH-1 television show, Love and Hip Hop, New York, agreed to forfeit all of his income from that show and personal appearances while he is awaiting sentencing in this case. Harris agreed to forfeit all of that income, amounting to at least $100,000 cash, as well as a 2011 Audi R8 vehicle, as substitute assets representing proceeds of his illegal activities.
The plea is the culmination of an investigation on the part of Special Agents of the Drug Enforcement Administration, under the direction of Special Agent in Charge James J. Hunt, New York Field Division, investigators with the Rochester Police Department, under the direction of Chief Michael Ciminelli, and Special Agents of the Internal Revenue Service, Criminal Investigation Division, under the direction of Shantelle P. Kitchen, Special Agent in Charge, New York Field Office.
Sentencing is scheduled for August 31, 2015, at 3:00 p.m. before Judge Geraci.
Last of 20 Defendants Sentenced in Large-Scale Meth Distribution RingRead the Press Release
BOISE – David Echevarria, 51, of Boise, Idaho, was sentenced today to 110 months in prison followed by five years of supervised release for possession with intent to distribute methamphetamine, U.S. Attorney Wendy J. Olson announced. U.S. District Judge Edward J. Lodge also ordered the defendant to pay a $2,500 fine. Echevarria pleaded guilty on January 30, 2015.
The distribution ring involved two distribution cells in the Treasure Valley: one led by Jason Holmberg now serving a prison term of 180 months, the other by Andrew Polney now in federal prison on a 130-month sentence. Co-defendant, Kenneth Jones, in Sacramento, California, supplied multi-pound shipments of methamphetamine, which was transported to the Treasure Valley for distribution. Jones is serving a prison term of 130 months. The group operated from about June 2012, through the time of the various arrests on April 18, 2013, and May 23, 2013. On April 9, 2013, Echevarria was stopped with approximately 55 grams of methamphetamine which he had obtained from Polney.
“Investigation and prosecution of large distribution organizations such as this are very demanding, but the effort is essential for keeping our communities safe and reducing this destructive substance in our area,” said Olson. “For many of these defendants, facing prosecution, accepting responsibility, admitting guilt, and being sentenced has been very beneficial in helping them to return to a productive life free of destructive drugs.”
The case is the result of a joint investigation of the Organized Crime and Drug Enforcement Task Force (OCDETF), which included the cooperative law enforcement efforts of the Drug Enforcement Administration (DEA), U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), Internal Revenue Service-Criminal Investigation (IRS-CI), Boise Police Department, Meridian Police Department, Ada County Sheriff’s Office, Canyon County Sheriff’s Office, and Nampa Police Department. Other federal agencies participating in the OCEDTF program include the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Federal Bureau of Investigation (FBI), and U.S. Marshals Service.
The OCDETF program is a federal, multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations.
Laredo Co-Conspirators Receive Significant Sentences for Selling Drugs and Guns in A School ZoneRead the Press Release
LAREDO, Texas – Luis Macias-Molinas, 32, Ricardo Rosas Jr., 27, and Manuel Aguilar, aka Chino, 25, all of Laredo, have been ordered to federal prison following their convictions for drug trafficking and gun related charges, announced U.S. Attorney Kenneth Magidson. Macias and Rosas pleaded guilty Oct. 17, 2013, while Aguilar was convicted Sept. 10, 2013.
Today, U.S. District Judge Marina Garcia Marmolejo ordered Macias to serve 156 months for conspiracy to sell methamphetamine within a school zone as well as felon in possession of firearm charges. Rosas was also convicted of the school zone methamphetamine charges and will serve a 151-sentence. Both were further ordered to serve five years of supervised release following completion of their sentences. Aguilar received a 40-month sentence for being a felon in possession of a firearm to be followed by three years of supervised release. At the hearing today, Macias and Rosas admitted to organizing a methamphetamine trafficking organization within Laredo. In handing down this sentence, Judge Marmolejo stated she was doing taxpayers a favor by imposing lengthy prison terms and keeping the community safe.
These individuals were involved in a large drug and firearm trafficking Investigation in Laredo and San Antonio. Between May 24, 2013, and June 28, 2013, Macias and Rosas sold more than 600 grams of methamphetamine to undercover federal agents, including multiple sales within a school zone. On June 28, 2013, Macias attempted to sell 118.5 grams of methamphetamine for six semi-automatic firearms. He purchased the firearms from federal agents and intended to sell the weapons to Aguilar. Macias and Rosas were arrested before Aguilar received the weapons. Subsequently, agents searched their respective residences and discovered a variety of drugs and guns within the premises.
Rosas admitted to employing Macias, who then distributed the narcotics throughout the community.
The case was investigated by the Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Laredo Police Department. Assistant U.S. Attorneys Sanjeev Bhasker and Homero Ramirez prosecuted the case.
Kuna Man Sentenced for False Statement Involving Social Security BenefitsRead the Press Release
BOISE - Del E. Weech, 59, of Kuna, Idaho, was sentenced today in United States District Court to six months in prison followed by three years of supervised release for making false statements involving social security benefits, U.S. Attorney Wendy J. Olson announced. U.S. District Judge Edward J. Lodge also ordered Weech to pay $13,004 in restitution. Weech pleaded guilty to the charge on February 9, 2015.
According to the plea agreement, Weech admitted that he signed a statement, under penalty of perjury, that his stepdaughter had not received her $14,929 benefits check from the Social Security Administration (SSA), causing the SSA to issue a partial payment in the amount of $9,838. In fact, Weech had already cashed the check. On two other occasions, Weech lied to the SSA, stating that he had not received his own monthly social security benefits, causing repayments to be generated. Weech then cashed his original checks and collected the repayments. In total, Weech stole $13,004 from the SSA.
The case was investigated by the Social Security Administration Office of Inspector General. The case was prosecuted by a Special Assistant U.S. Attorney as part of a partnership venture between the Social Security Administration Office of General Counsel and the United States Attorney’s Office to prosecute social security fraud.
Kingdom City Man Sentenced for Robbing Postal EmployeeRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Kingdom City, Mo., man was sentenced in federal court today for robbing an employee at the Kingdom City post office.
Lucas Wayne Branstetter, 39, of Kingdom City, was sentenced by U.S. District Judge Stephen R. Bough to seven years in federal prison without parole. Branstetter was sentenced as a career offender due to his prior felony convictions.
On Sept. 18, 2014, Branstetter pleaded guilty to robbing a postal employee. Branstetter entered a postal facility in Kingdom City on July 19, 2014, and presented a note to a postal employee that stated, “This is a robbery.” The postal employee placed $310 from the cash drawer into Branstetter’s backpack and he drove away from the post office on a motorcycle.
According to court documents, Branstetter was identified by a confidential source on July 21, 2014. On the same day, Branstetter was arrested for possessing stolen property after Laclede County, Mo., Sheriff’s Department deputies responded to a call regarding a suspicious person sleeping behind a local church. A stolen motorcycle was also parked behind the church. Branstetter had an active arrest warrant for forgery from the Blue Springs, Mo., Police Department.
Branstetter has been convicted of at least 12 felonies, including four prior felony convictions for burglary and a prior felony conviction for robbery, as well as numerous misdemeanors.
This case was prosecuted by Assistant U.S. Attorney Jim Lynn. It was investigated by the U.S. Postal Inspection Service, the Callaway County, Mo., Sheriff’s Department and the Laclede County, Mo., Sheriff’s Department.
Justice Department announces Ville Platte Police Department, Evangeline Sheriff’s Office investigationRead the Press Release
WASHINGTON – The Justice Department announced today that it has opened pattern or practice investigations into the use of investigative holds by the Ville Platte Police Department (VPPD) and the Evangeline Parish Sheriff’s Office (EPSO).
The investigations will focus on allegations that VPPD and EPSO officers use “investigative holds” to detain individuals without proper cause, and on the adequacy of VPPD and EPSO’s training, supervision and accountability mechanisms to prevent unlawful seizures. The Justice Department’s investigations will determine whether VPPD and EPSO officers engage in a pattern or practice of using investigative holds in violation of the Constitution and federal law.
“No individual should be detained without proper cause or arrested in violation of his or her civil rights,” said Attorney General Eric Holder. “As these investigations move forward, the Department of Justice will work to ensure that the actions of the Ville Platte Police Department and the Evangeline Parish Sheriff’s Office are in service of our shared mission, consistent with our common values, and in accordance with the Constitution that we are sworn to uphold.”
The Justice Department has contacted officials at VPPD, EPSO, the city of Ville Platte and Evangeline Parish, and will continue to work closely with these law enforcement agencies and municipalities as the investigations progress.
“Police officers across the country are called upon regularly to use their law enforcement authority to protect and safeguard members of their communities by investigating criminal activity,” said Principal Deputy Assistant Attorney General Vanita Gupta of the Civil Rights Division. “It is imperative that officers use their authority within the boundaries of the law and the Constitution. We are eager to work together with the Ville Platte Police Department, Evangline Parish Sheriff’s Office and the local municipalities to help ensure that their officers are engaged in law enforcement practices that are consistent with the Constitution.”
“All of us who work in law enforcement should be focused on due process every day,” said U.S. Attorney Stephanie A. Finley of the Western District of Louisiana. “Each citizen deserves to be treated with respect and in accordance with the Constitution. We will continue to work with all of our local partners to ensure that arrests and detentions are proper and legal, with the goal of having safeguards in place to make sure that similar violations do not occur in the future.”
The Violent Crime Control and Law Enforcement Act of 1994 prohibits state and local governments from engaging in a pattern or practice of misconduct by law enforcement officers that deprives individuals of federally-protected rights. The act also allows the Justice Department to remedy such misconduct through civil litigation. The Justice Department has conducted similar investigations and has obtained important reforms in police departments and law enforcement agencies across the country.
The Special Litigation Section of the Justice Department’s Civil Rights Division in Washington, D.C., is conducting the investigations. Individuals with relevant information are encouraged to contact the Justice Department by phone at 1-877-218-5228.
Additional information about the Civil Rights Division is available on its website at www.justice.gov/crt.
Click here for the Special Litigation Section’s police accomplishments fact sheet
Justice Department Honors Federal Team That Identified More Than 60,000 Victims and $100 Million in Financial FraudRead the Press Release
The Department of Justice will honor a federal team with the Crime Victims Financial Restoration Award for identifying 60,000 financial fraud victims and more than $100 million in financial losses, during the National Crime Victims’ Rights Service Awards ceremony Tuesday, April 21, in Washington, D.C.
From 2004 to 2009, the company MoneyGram International (MGI) processed a myriad of transactions associated with international marketing schemes, on behalf of scammers who conned victims out of thousands of dollars. The U.S. Attorney’s Office for the Middle District of Pennsylvania, the U.S. Department of Justice Asset Forfeiture Money Laundering Section and the U.S. Postal Inspection Service in Harrisburg worked together to investigate and prosecute MGI on behalf of the victims of these mass marketing fraud schemes.
MGI executives ignored victim complaints when first confronted by internal fraud investigators and federal law enforcement. By collaborating with the Better Business Bureau, the Federal Trade Commission and the media, who informed victims of their right to file claims to recover financial losses, this team returned $62.2 million to 22,377 victims or their families as of March 2015. Cross-border fraud investigations continue, resulting in the indictment, arrest and prosecution of more than 25 MGI agents and associates.
At the April 21 ceremony the Justice Department will also recognize 11 other individuals and programs for their outstanding efforts on behalf of crime victims. Descriptions of the honorees are available at the Office for Victims of Crime’s Gallery: https://ovcncvrw.ncjrs.gov/Awards/AwardGallery/gallerysearch.html.
The Department’s Office for Victims of Crime leads communities across the country in observing National Crime Victims’ Rights Week and hosts an award ceremony each year to bring greater awareness and sensitivity to the rights and needs of victims. President Reagan proclaimed the first Victims’ Rights Week in 1981, calling for greater sensitivity to the rights and needs of victims. This year’s observance takes place April 19-25, with the theme Engaging Communities. Empowering Victims.
About the Office of Justice Programs (OJP)
The Office of Justice Programs (OJP), headed by Assistant Attorney General Karol V. Mason, provides federal leadership in developing the nation’s capacity to prevent and control crime, administer justice and assist victims. OJP has six components: the Bureau of Justice Assistance; the Bureau of Justice Statistics; the National Institute of Justice; the Office of Juvenile Justice and Delinquency Prevention; the Office for Victims of Crime and the Office of Sex Offender Sentencing, Monitoring, Apprehending, Registering and Tracking. More information about OJP can be found at www.ojp.gov.
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The Assistant U.S. Attorneys from the Middle District of Pennsylvania honored today are Kim Daniel and Christy Fawcett, who have prosecuted cases against international marketing fraud schemes that use financial services network for the past 10 years. As a result of these efforts approximately 35 individuals have been successfully prosecuted; including extraditions to the United States from foreign countries; other defendants have been corrupt agents of financial services businesses. In 2013 MoneyGram International, a major provider of financial services in the U.S. and around the world, entered into a settlement agreement that resulted in a $100 million being set up to make restitution to victims. (see the link to a 2014 MoneyGram settlement announcement).
The investigation of such schemes by the U.S. Postal Inspection Service and the U.S. Attorney’s Office is continuing.
Justice Department Honors 12 Individuals and Teams for Advancing Rights and Services for Crime VictimsRead the Press Release
Attorney General Eric Holder will preside over the National Crime Victims’ Rights Service Awards ceremony at 2:00 p.m. on Tuesday, April 21. The event honors 12 individuals and programs for their extraordinary actions to bring positive and lasting changes in the lives of crime victims.
“The Department of Justice is proud to recognize the tremendous contributions of dedicated colleagues, passionate advocates and extraordinary partners in the field of victim services,” said Attorney General Eric Holder. “From safeguarding survivors of sexual violence to assisting victims of mass marketing fraud, the recipients of today’s awards have been instrumental in our nationwide effort to protect the most vulnerable among us, to prevent and combat crime, and to help victims find hope and seek justice.”
The department’s Office for Victims of Crime leads communities across the country in observing National Crime Victims’ Rights Week and hosts an award ceremony each year. President Reagan proclaimed the first Victims’ Rights Week in 1981, calling for greater sensitivity to the rights and needs of victims. For 2015, the week is observed from April 19 through 25, with the theme Engaging Communities. Empowering Victims.
Following is a list of the award recipients, who were nominated by their colleagues in the field and selected by the Attorney General:
The Allied Professional Award recognizes an individual or organization outside the victim assistance field for services or contributions to the victims’ field. Recipients: Mary Kay Inc. of Addison, Texas, and Assistant District Attorney Norman A. Gahnof the Milwaukee County District Attorney’s Office.
The Crime Victims Financial Restoration Award recognizes individuals, programs, organizations or teams that developed innovative ways of funding services for crime victims or instituted innovative approaches for securing financial restoration for crime victims. Recipient: A team of representatives from the U.S. Attorney’s Office of the Middle District of Pennsylvania, the department’s Asset Forfeiture Money Laundering Section and U.S. Postal Inspection Service for Harrisburg, Pennsylvania.
The National Crime Victim Service Award honors extraordinary efforts in direct service to crime victims. Recipients: Karen Kalergis, a victim advocate from Austin, Texas, and Executive Director Alecia “Lisa” Thompson-Heth of Wiconia Wawokiya Inc., of the Crow Creek Sioux Indian Reservation, Fort Thompson, South Dakota.
The Crime Victims’ Rights Award honors those whose efforts to advance or enforce crime victims’ rights have benefited crime victims at the state, tribal or national level. Recipient: Laurel Wemhoff, a survivor and advocate from Washington, D.C.
The Ronald Wilson Reagan Public Policy Award honors leadership, innovation and vision that leads to noteworthy changes in public policy that benefit crime victims. Recipients: Dr. Marcus Smith and attorney Matthew Smith, of Little Rock, Arkansas, and Director of Victim Services Suzanne Breedlove of the District Attorneys Council in Oklahoma City.
The Professional Innovation in Victim Service Award recognizes a program, organization or individual who has helped to expand the reach of victims’ rights and services. Recipient: Judge Paul M. Herbert of the Franklin County Municipal Court in Columbus, Ohio.
The Special Courage Award recognizes extraordinary bravery in the aftermath of a crime or courageous act on behalf of a victim or potential victim. Recipients: Ronald Cotton and Jennifer Thompson, of Chapel Hill, North Carolina.
The Vision 21 Crime Victims Research Award recognizes individual researchers or research teams that make a significant contribution to the nation’s understanding of crime victims’ issues. Recipient: Rebecca Campbell, of Michigan State University in East Lansing, Michigan.
The Volunteer for Victims Award honors individuals for their extraordinary and selfless efforts resulting in positive and lasting changes in the lives of crime victims. Recipient: LaWanda Hawkins, of San Pedro, California.
Descriptive narratives and videos of the contributions of recipients are available at Office for Victims of Crime’s Gallery.
About the Office of Justice Programs (OJP)
OJP, headed by Assistant Attorney General Karol V. Mason, provides federal leadership in developing the nation’s capacity to prevent and control crime, administer justice and assist victims. OJP has six components: the Bureau of Justice Assistance, the Bureau of Justice Statistics, the National Institute of Justice, the Office of Juvenile Justice and Delinquency Prevention, the Office for Victims of Crime and the Office of Sex Offender Sentencing, Monitoring, Apprehending, Registering and Tracking. More information about OJP can be found at www.ojp.gov.
Justice Department Announces Investigations of the Ville Platte, Louisiana, Police Department and the Evangeline Parish Sheriff's OfficeRead the Press Release
The Justice Department announced today that it has opened pattern or practice investigations into the use of investigative holds by the Ville Platte Police Department (VPPD) and the Evangeline Parish Sheriff’s Office (EPSO). The investigations will focus on allegations that VPPD and EPSO officers use “investigative holds” to detain individuals without proper cause, and on the adequacy of VPPD and EPSO’s training, supervision and accountability mechanisms to prevent unlawful seizures. The Justice Department’s investigations will determine whether VPPD and EPSO officers engage in a pattern or practice of using investigative holds in violation of the Constitution and federal law.
“No individual should be detained without proper cause or arrested in violation of his or her civil rights,” said Attorney General Eric Holder.” As these investigations move forward, the Department of Justice will work to ensure that the actions of the Ville Platte Police Department and the Evangeline Parish Sheriff's Office are in service of our shared mission, consistent with our common values, and in accordance with the Constitution that we are sworn to uphold.”
The Justice Department has contacted officials at VPPD, EPSO, the city of Ville Platte and Evangeline Parish, and will continue to work closely with these law enforcement agencies and municipalities as the investigations progress.
“Police officers across the country are called upon regularly to use their law enforcement authority to protect and safeguard members of their communities by investigating criminal activity,” said Principal Deputy Assistant Attorney General Vanita Gupta of the Civil Rights Division. “It is imperative that officers use their authority within the boundaries of the law and the Constitution. We are eager to work together with the Ville Platte Police Department, Evangeline Parish Sheriff’s Office and the local municipalities to help ensure that their officers are engaged in law enforcement practices that are consistent with the Constitution.”
“All of us who work in law enforcement should be focused on due process every day,” said U.S. Attorney Stephanie A. Finley of the Western District of Louisiana. “Each citizen deserves to be treated with respect and in accordance with the Constitution. We will continue to work with all of our local partners to ensure that arrests and detentions are proper and legal, with the goal of having safeguards in place to make sure that similar violations do not occur in the future.”
The Violent Crime Control and Law Enforcement Act of 1994 prohibits state and local governments from engaging in a pattern or practice of misconduct by law enforcement officers that deprives individuals of federally-protected rights. The act also allows the Justice Department to remedy such misconduct through civil litigation. The Justice Department has conducted similar investigations and has obtained important reforms in police departments and law enforcement agencies across the country.
The Special Litigation Section of the Justice Department’s Civil Rights Division in Washington, D.C. is conducting the investigations. Individuals with relevant information are encouraged to contact the Justice Department by phone at 1-877-218-5228.
Additional information about the Civil Rights Division is available on its website at www.justice.gov/crt.
Jury Finds Man Guilty of Motor Home Theft Conspiracy and Related ChargesRead the Press Release
GRAND RAPIDS, MICHIGAN –United States Attorney Patrick Miles announced today that a federal jury returned guilty verdicts on all counts against Ronald Bruce Myers, 56, a Nevada resident charged with conspiring with others to steal, transport, and sell motor homes throughout the United States, including the theft of three motor homes from businesses in Western Michigan. The jury also convicted him of transporting the stolen motor homes out of Michigan. Myers stole a Country Coach motor home from Holland Bus and Motor Homes on March 28, 2012. Myers returned to Michigan in early May 2012, at which time he stole two more motor homes from Midway RV Center of Kentwood. He faces up to 35 years in prison for the conspiracy and theft of the motor homes. Myers also stole two motor homes in Alabama, one in Missouri, one in North Carolina, and one in Florida.
The jury also convicted Myers of three counts related to money laundering. The evidence at trial showed that Myers used a series of aliases to obtain false title documents, open bank accounts and to forward mail as part of his criminal scheme. He moved hundreds of thousands of dollars through the bank accounts opened under false names and/or using purported corporations. IRS records showed that Myers and his corporations did not file tax returns from 2008 to 2012. He faces up to an additional sixty years in prison for the money laundering convictions. Myers had already been convicted in four previous federal prosecutions involving stolen vehicles.
Myers remains in custody pending his sentencing, which has been set for August 21, 2015 before the Honorable Robert Holmes Bell, United States District Court Judge.
ENDJasper County Man Sentenced for Distributing CocaineRead the Press Release
BEAUMONT, Texas – A 28-year-old Jasper, Texas man has been sentenced to federal prison for drug violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Shane Dwayne Hadnot pleaded guilty on Dec. 10, 2014, to possession with intent to distribute cocaine and was sentenced to 87 months in federal prison today by U.S. District Judge Marcia Crone.
According to information presented in court, on Nov. 7, 2013, Alfred Wright, of Jasper, Texas, was reported missing by his family after his truck broke down in rural Sabine County, Texas. Articles of Wright’s clothing were found on private land, approximately a mile from where Wright was last seen. After searchers initially failed to locate Wright, his body was found on Nov. 25, 2013 in brush near where his clothing had been found. An investigation into the cause of Wright’s disappearance and death revealed his involvement with Shane Hadnot. Phone records, witness statements, and drug evidence located during the search of Shane Hadnot’s car, indicated that Hadnot was selling cocaine to Alfred Wright.
During the two-day period before Wright’s death, Hadnot and Wright exchanged 20 text messages. The indictment alleges that on Nov. 7, 2013, Wright sent a text message to Hadnot at 12:36 pm requesting to purchase cocaine and other illegal narcotics from Hadnot. Wright went missing approximately five hours later. An autopsy was performed on Wright’s body and toxicology testing revealed that Wright’s blood contained cocaine, methamphetamine and Xanax. The final autopsy report, and other experts in the fields of pathology, toxicology, and anthropology concluded that Wright’s cause of death was an accident due to combined drug intoxication. Hadnot was indicted by a federal grand jury on Aug. 6, 2014 and charged with drug trafficking violations.
This case was investigated by the Texas Rangers, the Federal Bureau of Investigation, and the U.S. Drug Enforcement Administration. This case was prosecuted by Assistant U.S. Attorneys Brit Featherston and John B. Ross.
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Jamaican national charged with illegally reentering the countryRead the Press Release
Andrew Parker, 40, a Jamaican national living in Cleveland, was indicted by a federal grand jury for illegally reentering the United States after having been deported, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio.
The indictment alleges that the defendant was found in the Akron area after having been deported from the United States in 1997 and without having received permission to reenter the United States.
The United States Immigration and Customs Service conducted the investigation. The case is being prosecuted by Assistant United States Attorney Miranda E. Dugi.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial, in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Houston Man Arrested Following Social Media PostsRead the Press Release
HOUSTON – Frederick Ramon Robinson, 45, a Houston resident and convicted felon, has been arrested and is set to make his initial appearance on charges of unlawfully possessing a firearm, announced U.S. Attorney Kenneth Magidson.
Robinson was arrested today and is set to make his initial appearance before U.S. Magistrate Judge Frances H. Stacy at 2:00 p.m.
The criminal complaint alleges that authorities initiated an investigation into Robinson after he publicly posted several messages on various social media sites such as Twitter. Those alleged posts claimed such comments as “if white people hate ISIS so much, then I like ISIS. The enemy of my enemy is my friend. #chopthemheadsoff Amerikkka is the Black Man’s Foe.” The complaint further alleges he tweeted such statements as “I say, don’t hesitate – start shooting in their cars. empty whole clips. find them at home and fire bomb it. anything., do something.”
According to the charges, Robinson posted pictures of firearms he owned and allegedly demonstrated how to load firearms in videos he posted online.
As a convicted felon, he is prohibited from possessing firearms per federal law. If convicted, he faces up to 10 years in prison.
The charges are the result of investigation conducted by a joint State and federal task force that includes the Bureau of Alcohol Tobacco, Firearms and Explosives and the FBI. Assistant U.S. Attorney Alamdar S. Hamdani is prosecuting the case.
A criminal complaint is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.Guatemalan Man SentencedRead 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 Josue Joel Castaneda-Cuyuch, 31, a citizen of Guatemala, who was convicted of illegal reentry after having been previously deported and removed from the United States, was sentenced to time served (seven months) by U.S. District Judge Richard J. Arcara.
Assistant U.S. Attorney Marie P. Grisanti, who handled the case, stated that on September 11, 2014, the defendant, an alien who had previously been deported and removed from the United States on August 20, 2010, was found in the United States without having obtained the consent of the Attorney General of the United States.
The sentencing is the result of an investigation by the United States Border Patrol, under the direction Steven J. Oldman, Patrol Agent in Charge.
Government Sues Skilled Nursing Chain HCR Manorcare for Allegedly Providing Medically Unnecessary TherapyRead the Press Release
The government has intervened in three False Claims Act lawsuits and filed a consolidated complaint against HCR ManorCare alleging that ManorCare knowingly and routinely submitted false claims to Medicare and Tricare for rehabilitation therapy services that were not medically reasonable and necessary, the Department of Justice announced today. ManorCare is one of the nation’s largest healthcare providers, operating approximately 281 skilled nursing facilities (SNFs) in 30 states.
“The Department of Justice is committed to ensuring that healthcare providers who pressure their employees to provide medically unnecessary services to Medicare beneficiaries and Tricare recipients solely to increase their own profits are held accountable,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division. “We will not relent in our efforts to stop these false billing schemes and recover funds for federal healthcare programs.”
The government’s complaint alleges that ManorCare, which is owned by The Carlyle Group, exerted pressure on SNF administrators and rehabilitation therapists to meet unrealistic financial goals that resulted in the provision of medically unreasonable and unnecessary services to Medicare and Tricare patients. ManorCare allegedly set prospective billing goals designed to significantly increase revenues without regard to patients’ actual clinical needs and threatened to terminate SNF managers and therapists if they did not administer the additional treatments necessary to qualify for the highest Medicare payments. ManorCare also allegedly increased its Medicare payments by keeping patients in its facilities even though they were medically ready to be discharged.
“We strive for a system whereby health care providers provide reasonable and necessary services without overbilling Medicare for unreasonable and unnecessary services” said U.S. Attorney Dana J. Boente of the Eastern District of Virginia. “We will continue our robust investigations of the companies operating in this important sector of our economy.”
“We want to ensure that taxpayer dollars are used to pay for health care for Americans that need it, not to unjustly enrich health care companies,” said U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan. “Medical providers will be held accountable when they exploit patients for profit by subjecting them to therapies they don’t need and then billing Medicare for reimbursement.”
“Today’s action is the result of a robust investigation into alleged false billings submitted to Medicare and Tricare for rehabilitation therapy services that were not necessary for patients,” said Assistant Director in Charge Andrew G. McCabe of the FBI’s Washington, D.C., Field Office. “Healthcare fraud is a top priority for the FBI and we will continue to work closely with federal, state and local law enforcement partners to address vulnerabilities, fraud and abuse in the healthcare industry.”
The three consolidated lawsuits were filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government for false claims for government funds and to receive a share of any recovery. The False Claims Act permits the government to intervene in such lawsuits, as it has done in these cases. A defendant that violates the False Claims Act is liable for three times the government’s losses plus civil penalties.
The government’s intervention in these matters illustrates its emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $24 billion through False Claims Act cases, with more than $15.3 billion of that amount recovered in cases involving fraud against federal health care programs. Tips and complaints from all sources about potential fraud, waste, abuse and mismanagement, including the conduct described in the United States’ complaint, can be reported to the Department of Health and Human Services, at 800-HHS-TIPS (800-447-8477).
These matters were investigated by the Civil Division’s Commercial Litigation Branch; the U.S. Attorney’s Offices for the Northern and Southern Districts of Iowa, Eastern and Western Districts of Michigan, Northern and Southern Districts of Ohio, Eastern District of Pennsylvania and Eastern District of Virginia; the Department of Health and Human Services’ Office of Inspector General; the Department of Defense’s Office of Inspector General; the Defense Health Agency; the Medicaid Fraud Control Units of the California Attorney General’s Office, Delaware Department of Justice, the Florida Attorney General’s Office, Illinois State Police, Iowa Department of Inspections and Appeals, the Maryland Attorney General’s Office, the Michigan Attorney General’s Office, the Ohio Attorney General’s Office and the Virginia Attorney General’s Office; the National Association of Medicaid Fraud Control Units; and the FBI.
The cases are captioned United States ex rel. Ribik v. ManorCare, Inc., et al., Case No. 1:09cv13-CMH-HCB (E.D. Va.); United States ex rel. Slough v. HCR ManorCare, et al., Case No. 1:14cv1228 (E.D. Va.); and United States ex rel. Carson v. HCR ManorCare, et al., Case No. 1:11cv1054 (E.D. Va.).
The claims asserted against ManorCare are allegations only, and there has been no determination of liability.
Government Sues Skilled Nursing Chain HCR Manorcare for Allegedly Providing Medically Unnecessary TherapyRead the Press Release
WASHINGTON – The government has intervened in three False Claims Act lawsuits and filed a consolidated complaint against HCR ManorCare alleging that ManorCare knowingly and routinely submitted false claims to Medicare and Tricare for rehabilitation therapy services that were not medically reasonable and necessary, the Department of Justice announced today. ManorCare is one of the nation’s largest healthcare providers, operating approximately 281 skilled nursing facilities (SNFs) in 30 states.
“The Department of Justice is committed to ensuring that healthcare providers who pressure their employees to provide medically unnecessary services to Medicare beneficiaries and Tricare recipients, solely to increase their own profits, are held accountable,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division. “We will not relent in our efforts to stop these false billing schemes and recover funds for federal healthcare programs.”
The government’s complaint alleges that ManorCare, which is owned by The Carlyle Group, exerted pressure on SNF administrators and rehabilitation therapists to meet unrealistic financial goals that resulted in the provision of medically unreasonable and unnecessary services to Medicare and Tricare patients. ManorCare allegedly set prospective billing goals designed to significantly increase revenues without regard to patients’ actual clinical needs and threatened to terminate SNF managers and therapists if they did not administer the additional treatments necessary to qualify for the highest Medicare payments. ManorCare also allegedly increased its Medicare payments by keeping patients in its facilities even though they were medically ready to be discharged.
“We strive for a system whereby health care providers provide reasonable and necessary services without overbilling Medicare for unreasonable and unnecessary services” said U.S. Attorney Dana Boente of the Eastern District of Virginia. “We will continue our robust investigations of the companies operating in this important sector of our economy.”
“We want to ensure that taxpayer dollars are used to pay for health care for Americans that need it, not to unjustly enrich health care companies,” said U.S. Attorney Barbara McQuade of the Eastern District of Michigan. “Medical providers will be held accountable when they exploit patients for profit by subjecting them to therapies they don’t need and then billing Medicare for reimbursement.”
“Today’s action is the result of a robust investigation into alleged false billings submitted to Medicare and Tricare for rehabilitation therapy services that were not necessary for patients,” said Assistant Director in Charge Andrew G. McCabe of the FBI’s Washington, D.C., Field Office. “Healthcare fraud is a top priority for the FBI and we will continue to work closely with federal, state and local law enforcement partners to address vulnerabilities, fraud and abuse in the healthcare industry.”
The three consolidated lawsuits were filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government for false claims for government funds and to receive a share of any recovery. The False Claims Act permits the government to intervene in such lawsuits, as it has done in these cases. A defendant that violates the False Claims Act is liable for three times the government’s losses plus civil penalties.
The government’s intervention in these matters illustrates its emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $24 billion through False Claims Act cases, with more than $15.3 billion of that amount recovered in cases involving fraud against federal health care programs. Tips and complaints from all sources about potential fraud, waste, abuse and mismanagement, including the conduct described in the United States’ complaint, can be reported to the Department of Health and Human Services, at 800-HHS-TIPS (800-447-8477).
These matters were investigated by the Civil Division’s Commercial Litigation Branch; the U.S. Attorney’s Offices for the Northern and Southern Districts of Iowa, Eastern and Western Districts of Michigan, Northern and Southern Districts of Ohio, Eastern District of Pennsylvania, and Eastern District of Virginia; the Department of Health and Human Services’ Office of Inspector General; the Department of Defense’s Office of Inspector General; the Defense Health Agency; the Medicaid Fraud Control Units of the California Attorney General’s Office, Delaware Department of Justice, the Florida Attorney General’s Office, Illinois State Police, Iowa Department of Inspections and Appeals, the Maryland Attorney General’s Office, the Michigan Attorney General’s Office, the Ohio Attorney General’s Office, and the Virginia Attorney General’s Office; the National Association of Medicaid Fraud Control Units; and the FBI.
The cases are captioned United States ex rel. Ribik v. ManorCare, Inc., et al., Case No. 1:09cv13-CMH-HCB (E.D. Va.); United States ex rel. Slough v. HCR ManorCare, et al., Case No. 1:14cv1228 (E.D. Va.); and United States ex rel. Carson v. HCR ManorCare, et al., Case No. 1:11cv1054 (E.D. Va.).
The claims asserted against ManorCare are allegations only, and there has been no determination of liability.
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Government Sues Skilled Nursing Chain HCR ManorCare for Allegedly Providing Medically Unnecessary TherapyRead the Press Release
ALEXANDRIA, Va. – The government has intervened in three False Claims Act lawsuits and filed a consolidated complaint against HCR ManorCare alleging that ManorCare knowingly and routinely submitted false claims to Medicare and Tricare for rehabilitation therapy services that were not medically reasonable and necessary, the Department of Justice announced today. ManorCare is one of the nation’s largest healthcare providers, operating approximately 281 skilled nursing facilities (SNFs) in 30 states.
“The Department of Justice is committed to ensuring that healthcare providers who pressure their employees to provide medically unnecessary services to Medicare beneficiaries and Tricare recipients, solely to increase their own profits, are held accountable,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division. “We will not relent in our efforts to stop these false billing schemes and recover funds for federal healthcare programs.”
The government’s complaint alleges that ManorCare, which is owned by The Carlyle Group, exerted pressure on SNF administrators and rehabilitation therapists to meet unrealistic financial goals that resulted in the provision of medically unreasonable and unnecessary services to Medicare and Tricare patients. ManorCare allegedly set prospective billing goals designed to significantly increase revenues without regard to patients’ actual clinical needs and threatened to terminate SNF managers and therapists if they did not administer the additional treatments necessary to qualify for the highest Medicare payments. ManorCare also allegedly increased its Medicare payments by keeping patients in its facilities even though they were medically ready to be discharged.
“We strive for a system whereby health care providers provide reasonable and necessary services without overbilling Medicare for unreasonable and unnecessary services” said U.S. Attorney Dana Boente of the Eastern District of Virginia. “We will continue our robust investigations of the companies operating in this important sector of our economy.”
“We want to ensure that taxpayer dollars are used to pay for health care for Americans that need it, not to unjustly enrich health care companies,” said U.S. Attorney Barbara McQuade of the Eastern District of Michigan. “Medical providers will be held accountable when they exploit patients for profit by subjecting them to therapies they don’t need and then billing Medicare for reimbursement.”
“Today’s action is the result of a robust investigation into alleged false billings submitted to Medicare and Tricare for rehabilitation therapy services that were not necessary for patients,” said Assistant Director in Charge Andrew G. McCabe of the FBI’s Washington, D.C., Field Office. “Healthcare fraud is a top priority for the FBI and we will continue to work closely with federal, state and local law enforcement partners to address vulnerabilities, fraud and abuse in the healthcare industry.”
The three consolidated lawsuits were filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government for false claims for government funds and to receive a share of any recovery. The False Claims Act permits the government to intervene in such lawsuits, as it has done in these cases. A defendant that violates the False Claims Act is liable for three times the government’s losses plus civil penalties.
The government’s intervention in these matters illustrates its emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $24 billion through False Claims Act cases, with more than $15.3 billion of that amount recovered in cases involving fraud against federal health care programs. Tips and complaints from all sources about potential fraud, waste, abuse and mismanagement, including the conduct described in the United States’ complaint, can be reported to the Department of Health and Human Services, at 800-HHS-TIPS (800-447-8477).
These matters were investigated by the Civil Division’s Commercial Litigation Branch; the U.S. Attorney’s Office for the Eastern District of Virginia, the Northern and Southern Districts of Iowa, Eastern and Western Districts of Michigan, Northern and Southern Districts of Ohio, and the Eastern District of Pennsylvania; the Department of Health and Human Services’ Office of Inspector General; the Department of Defense’s Office of Inspector General; the Defense Health Agency; the Medicaid Fraud Control Units of the California Attorney General’s Office, Delaware Department of Justice, the Florida Attorney General’s Office, Illinois State Police, Iowa Department of Inspections and Appeals, the Maryland Attorney General’s Office, the Michigan Attorney General’s Office, the Ohio Attorney General’s Office, and the Virginia Attorney General’s Office; the National Association of Medicaid Fraud Control Units; and the FBI.
The cases are captioned United States ex rel. Ribik v. ManorCare, Inc., et al., Case No. 1:09cv13-CMH-HCB (E.D. Va.); United States ex rel. Slough v. HCR ManorCare, et al., Case No. 1:14cv1228 (E.D. Va.); and United States ex rel. Carson v. HCR ManorCare, et al., Case No. 1:11cv1054 (E.D. Va.).
The claims asserted against ManorCare are allegations only, and there has been no determination of liability.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia.
Futures Trader Charged with Illegally Manipulating Stock Market, Contributing to the May 2010 Market ‘Flash Crash’Read the Press Release
A futures trader was arrested in the United Kingdom today on U.S. wire fraud and commodities fraud and manipulation charges in connection with his alleged role in the May 2010 “Flash Crash,” when the Dow Jones Industrial Average plunged 600 points in five minutes, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and Special Agent in Charge Robert J. Holley of the FBI’s Chicago Division.
Navinder Singh Sarao, 36, of Hounslow, United Kingdom, was arrested today in the United Kingdom, and the United States is requesting his extradition. Sarao was charged in a federal criminal complaint in the Northern District of Illinois on Feb. 11, 2015, with one count of wire fraud, 10 counts of commodities fraud, 10 counts of commodities manipulation, and one count of “spoofing,” a practice of bidding or offering with the intent to cancel the bid or offer before execution.
According to allegations in the complaint, which was unsealed today, Sarao allegedly used an automated trading program to manipulate the market for E-Mini S&P 500 futures contracts (E-Minis) on the Chicago Mercantile Exchange (CME). E-Minis are stock market index futures contracts based on the Standard & Poor’s 500 Index. Sarao’s alleged manipulation earned him significant profits and contributed to a major drop in the U.S. stock market on May 6, 2010, that came to be known as the “Flash Crash.” On that date, the Dow Jones Industrial Average fell by approximately 600 points in a five-minute span, following a drop in the price of E-Minis.
According to the complaint, Sarao allegedly employed a “dynamic layering” scheme to affect the price of E-Minis. By allegedly placing multiple, simultaneous, large-volume sell orders at different price points—a technique known as “layering”—Sarao created the appearance of substantial supply in the market. As part of the scheme, Sarao allegedly modified these orders frequently so that they remained close to the market price, and typically canceled the orders without executing them. When prices fell as a result of this activity, Sarao allegedly sold futures contracts only to buy them back at a lower price. Conversely, when the market moved back upward as the market activity ceased, Sarao allegedly bought contracts only to sell them at a higher price.
The charges contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
This case is being investigated by the FBI’s Chicago Division. The case is being prosecuted by Assistant Chief Brent S. Wible and Trial Attorney Michael T. O’Neill of the Criminal Division’s Fraud Section, with assistance provided by the U.S. Attorney’s Office for the Northern District of Illinois, the Criminal Division’s Office of International Affairs and the International Assistance Unit of the Metropolitan Police Service of London, United Kingdom. The Department of Justice appreciates the substantial assistance of the Commodity Futures Trading Commission’s Division of Enforcement, which referred this matter to the department.
Sarao Criminal Complaint
Four Men Arrested in Scheme to Sell Stolen Material from Fort CarsonRead the Press Release
DENVER – Four individuals, including two active duty members of the U.S. Army, have been arrested based on Criminal Complaints, charging each with one count of conspiracy to commit theft of government property. If convicted of this crime, each defendant faces not more than 5 years in federal prison, and up to a $250,000 fine. All four defendants (listed below), are scheduled to appear before U.S. Magistrate Judge Michael J. Watanabe today, Tuesday, April 21, 2015 at 10:00 a.m. for detention hearings.
Those arrested:
Daniel Francis, age 50, of Colorado Springs
Staff Sergeant Benjamin Thomas Cardwell, age 41, of Fort Carson
Sergeant Johnny Dominic Herrera, age 29, of Fort Carson
Todd Crow, age 34, of Colorado Springs“Dedicated investigative work by a team of federal law enforcement agents led to the identification of a ring of thieves who are alleged to have stolen government property, selling it through a co-conspirator,” said U.S. Attorney John Walsh. “The stolen goods covered the gamut, from batteries, to MREs, to sensitive technology, and was mostly sold on eBay. This investigation is ongoing as we seek to track what was taken, where it went, and what was sold, and then follow the money.”
“The FBI and our partners will thoroughly investigate the misappropriation of U.S. government resources,” said FBI Denver Special Agent in Charge Thomas Ravenelle. “Such conduct undermines the intended use of taxpayer dollars, and we encourage anyone who suspects this type of activity to immediately report their information to law enforcement.”
"This is a prime example of our special agents working shoulder to shoulder with unit commanders and our fellow law enforcement agencies to root out crime affecting the U.S. Army and helping to bring those responsible to justice," said Chris Grey, spokesman for the U.S. Army Criminal Investigation Command.
“Fort Carson is unable to comment on the specifics of the ongoing investigation. Fort Carson is collaborate fully with all involved agencies,” said Lt. Colonel Armando Hernandez,” Fort Carson Spokesperson.
This case was investigated by the FBI, the Army Criminal Investigative Division (CID) and Naval Criminal Investigative Service (NCIS), with support from U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI), the U.S. Postal Inspection Service (USPIS), and the Colorado Springs Police Department.
A Criminal Complaint is a probable cause charging document. Anyone accused of committing a felony violation of federal law has a Constitutional right to be indicted by a grand jury.
The charges contained in the four individual Criminal Complaints are allegations, and the defendants are presumed innocent unless and until proven guilty.
This case is being prosecuted by Assistant U.S. Attorney Beth Gibson.
Four Arrested on Federal Drug ChargesRead the Press Release
JOHNSTOWN, Pa. – Three Altoona men and a Johnstown resident have been arrested and charged in federal court with violating the federal drugs laws, United States Attorney David J. Hickton announced today.
The criminal complaint charges Shavoun Berry, aka Anthony, 39, of Altoona, Pa.; Terrance Sitton, 42 of Johnstown, Pa.; Darrin Canaan, aka Dirt, 35, of Altoona, Pa.; and Matthew Fee, 32, of Altoona, Pa., with conspiracy to distribute and possess with the intent to distribute 500 grams or more of cocaine and conspiracy to distribute and possess with the intent to distribute 100 grams or more of heroin.
“With the arrest of these individuals, we have disrupted a significant drug trafficking organization that has been distributing significant quantities of illegal substances in Blair and Cambria counties over the last several months,” stated U.S. Attorney Hickton. “In fact, this case involves the largest seizure of packaged heroin in this part of Western Pennsylvania.”
“This case demonstrates the continued successful partnership of federal, state and local law enforcement in Western Pennsylvania,” said Special Agent in Charge Scott S. Smith of the FBI’s Pittsburgh Field Office. “Like our partners, the Pittsburgh Division of the FBI is committed to stopping the flow of heroin and improving the quality of life in the communities we serve.”
According to USA Hickton, the complaint alleges that, between January 2015 and April 17, investigating agents intercepted dozens of drug-related telephone calls and text messages on phones used by the defendants, conducted physical surveillance and employed other investigative tools. Agents determined that Berry is the leader of a large-scale illegal drug distribution operation in the Cambria and Blair Counties, and elsewhere, and conspired with Sitton, Canaan and Fee to distribute large quantities of illegal drugs in the Western District of Pennsylvania.
According to the complaint, in the past few days, Berry arranged for Sitton to travel to Berry’s supplier in New York and retrieve a large quantity of illegal drugs. On April 17, at approximately 5:40 a.m., Sitton traveled from Western Pennsylvania to New York to retrieve what was believed to be a large quantity of cocaine. During the search of the suspect vehicle pursuant to the search warrant, an extremely well-concealed false compartment, or “trap,” was located in the rear portion of the Jeep. Upon entry into the trap, in excess of 300 bricks of heroin (more than 15,000 stamp bags) were located.
Berry was previously convicted in the United States District Court for the Western District of Pennsylvania on drug trafficking charges. He is currently on federal supervised release.
The defendants will appear in federal court in Johnstown on Wednesday for detention hearings before Federal Magistrate Judge Keith A. Pesto.
The law provides for a maximum total sentence at each count of at least five years and up to 40 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 Stephanie Haines is prosecuting this case. Special agents of the FBI, and member of the Pennsylvania Attorney General’s Office, the Cambria County Drug Task Force, the Altoona Police Department and the Cambria County District Attorney’s Office, conducted the investigation that led to the complaint against these individuals.
Former U.S. Border Patrol Agent Sentenced to Prison for Child Pornography ConvictionRead the Press Release
ALBUQUERQUE – Abel Michael Quiroz, 27, a former U.S. Border Patrol Agent who resides in Las Cruces, N.M., Quiroz was sentenced yesterday afternoon in federal court to 30 months in prison for his child pornography conviction. Quiroz will be on supervised release for five years after completing his prison sentence. He also will be required to register as a sex offender.
Quiroz was arrested on April 29, 2014, on a criminal complaint charging him with receiving and possessing visual depictions of minors engaged in sexually explicit conduct. According to the criminal complaint, Homeland Security Investigations (HSI) initiated an investigation into Quiroz after receiving information that an adult male, later confirmed to be Quiroz, was having inappropriate communications with a 15-year-old child (victim).
The complaint asserted that execution of a search warrant for the contents of an email address belonging to Quiroz revealed numerous sexually explicit communications between Quiroz and the victim as well as nude and sexually explicit photographs of the victim. On April 29, 2014, HSI special agents executed a federal search warrant at Quiroz’s residence where they seized digital media and arrested Quiroz. There was no evidence suggesting that Quiroz’s criminal activities were conducted with government-owned equipment or technology.
On Sept. 3, 2014, Quiroz entered a guilty plea to a felony information charging him with possession of child pornography. In entering his guilty plea, Quiroz admitted that from Feb. 2013 through Oct. 2013, he communicated with the victim, whom he knew to be a minor residing in a state other than New Mexico, through online chats, mail, email, telephone conversations and text messages. Quiroz also admitted receiving sexually explicit photographs of the victim via email and unlawfully possessing the photographs in his email account.
This case was investigated by the Child Exploitation Unit of HSI’s office in Las Cruces pursuant to Project iGuardian, an HSI initiative designed to reach children, parents and teachers and share information about the dangers of online environments, how to stay safe online and how to report abuse and suspicious activity. The Las Cruces Police Department assisted in the investigation of this case.
The case is being prosecuted by Assistant U.S. Attorney Alexander Shapiro of the U.S. Attorney’s Las Cruces Branch Office as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice (DOJ) to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and DOJ’s Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
The Operation also was brought as a part of the New Mexico Internet Crimes Against Children (ICAC) Task Force’s mission, which is to locate, track, and capture Internet child sexual predators and Internet child pornographers in New Mexico. There are 74 federal, state and local law enforcement agencies associated with the New Mexico ICAC Task Force, which is funded by a grant administered by the NMAGO. Anyone with information relating to suspected child predators and suspected child abuse is encouraged to contact federal or local law enforcement.
Former North Chicago School Board Member Sentenced to 30 Months in Federal Prison for Bus Contracts Fraud SchemeRead the Press Release
CHICAGO ― A former North Chicago school board member, and the last defendant of five, was sentenced today to 30 months in federal prison for receiving at least $566,000 in kickbacks from three co-defendants who controlled several different transportation companies that received more than $21 million in student bus contracts over nearly a decade.
The defendant, ALICE SHERROD, 63, of North Chicago, pleaded guilty in September 2013 to one count each of wire fraud and filing a false federal income tax return. Sherrod admitted that between 2001 and 2010 she schemed to deprive the approximately 4,000-student North Chicago Community Unit School District 187 (NCSD) of her honest services. Sherrod, who was the school district’s Director of Transportation, participated in the fraud scheme with four co-defendants, including Gloria Harper, who was the former President of the North Chicago school board. The three co-defendants funneled kickbacks totaling at least $800,000 to Harper and Sherrod and made more than $9.6 million in profits.
“Unlike three of her co-defendants, she was in a position of public trust that affected poor children. She did not think about who she was hurting. And this went on for more than five years.” U.S. District Judge Sharon Johnson Coleman said in imposing the sentence today. Judge Coleman ordered Sherrod to serve her sentence beginning August 31, 2015. The judge also ordered Sherrod to pay approximately $7.2 million in restitution.
“The North Chicago School District has one of the highest low-income populations in the state. But rather than looking out for the interests of the district’s taxpayers and the children who depended on the schools for education, Sherrod selfishly used her position to enrich herself, and then filed false tax returns,” Assistant U.S. Attorney Matthew Getter argued in the government’s sentencing memorandum.
All five defendants pled guilty last year and have been sentenced. In addition to Sherrod’s sentence of 30 months imposed today, Gloria Harper, 64, of Berwyn and formerly of Gurnee, received a 10 year sentence, Tommie Boddie, 69, of Harvest, Ala., and formerly of Wadsworth received a one-day term of imprisonment followed by a three year term of supervised release including nine months’ home confinement; Derrick Eubanks, 50, of Lake Villa received six months’ imprisonment; and Barrett White, 55, of Matteson, received a one day term of imprisonment followed by a one year term of supervised release during which White will spend the first six months of supervised release serving weekend imprisonment.
Sherrod, who was District 187's transportation director from 2001 to July 2010, used her position, along with Harper, to enrich themselves secretly by soliciting and accepting gifts and cash from their three co-defendants in exchange for favorable official action regarding student transportation contracts. Initially, Harper and Sherrod received kickbacks of approximately $4,000 to $5,000 a month but, by 2003, they were collecting approximately $20,000 a month.
From the late 1990s until mid-2003, the NCSD contracted with various companies to provide student transportation, including T&M Transportation, which was owned in part and controlled by Boddie, and Eubanks Transportation, which was owned in part and controlled by Eubanks. In 2001, Harper and Sherrod met with Boddie and agreed they would arrange for the NCSD to increase the number of students that T&M transported in exchange for kickback payments.
In May 2003, Harper suggested to Boddie and Eubanks that they join together to form one company ― Safety First Transportation, Inc., which won the NCSD’s transportation contract in 2003, and Harper, Sherrod, Boddie, and Eubanks agreed that they would split the profits from the contract. After an IRS audit of Safety First in 2006-2007, White, who had been acting as the “bagman” for the kickbacks, began receiving funds from Safety First as both an employee and a contractor, even though he provided little service other than being the bagman.
In April 2008, the defendants agreed to set up a new company, Quality Trans, LLC, to replace Safety First and to assume its contracts with the school district. All five agreed to continue splitting profits from Quality Trans, and Boddie, Eubanks and White continued making cash payments to Harper and Sherrod.
The sentence was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Robert J. Holley, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation; and Stephen Boyd, Special Agent-in-Charge of the Internal Revenue Service Criminal Investigation Division in Chicago. The North Chicago School District cooperated with the investigation.
Former Executive of Nuclear Power Company Pleads GuiltyRead the Press Release
BOISE - Jennifer R. Ransom, 40, of Meridian, Idaho, pleaded guilty today to one count of securities fraud, U.S. Attorney Wendy J. Olson announced. Her guilty plea was to Count Five of the pending indictment. The grand jury returned the indictment against Ms. Ransom on November 14, 2014.
According to the plea agreement, Ransom was the Senior Vice President of Administration of Alternate Energy Holdings, Inc. (“AEHI”). AEHI was a development stage company headquartered in Eagle, Idaho that planned to construct and operate a nuclear power plant in Payette County, Idaho.
According to the plea agreement, Ransom joined AEHI in late 2007. Prior to joining AEHI, Ransom took and passed the Series 63 examination, one of the tests required to become a licensed Securities Agent, and knew it was wrongful and unlawful to engage in conduct that was designed to defraud or deceive investors by artificially controlling or fraudulently affecting the price of securities. Notwithstanding, she agreed with her co-defendant, Donald L. Gillispie, the former President and CEO of AEHI, and other “nominees” to a scheme to defraud or deceive AEHI investors.
According to the plea agreement, the scheme involved Gillispie and Ransom recruiting nominees to make purchases of AEHI stock on the market for the express purpose of artificially inflating the market price of AEHI stock. Ransom personally helped recruit one of the nominees. Without investors’ knowledge, Gillispie and Ransom provided AEHI funds, obtained almost exclusively from investors, to two of the nominees to fund their market purchases of AEHI stock.
According to the plea agreement, investors who purchased AEHI stock directly from AEHI, through Private Placement Memoranda (PPM), were offered a price discounted from the market price that nominees were attempting to inflate. However, PPM investors could only purchase restricted AEHI stock, which they could not sell for six months to one year. On September 9, 2009 through September 11, 2009, Ransom assisted a nominee in making purchases of AEHI stock on the market. The purpose of these purchases was to artificially increase the market price of AEHI stock, which was trading above the PPM price. During the next two months, private investors bought approximately $516,885 worth of AEHI restricted stock at the lower PPM price.
According to the plea agreement, Ransom received shares of AEHI stock as executive compensation. From June of 2010, through September of 2010, a period during which attempts were being made to artificially inflate the market price of AEHI stock, Ransom sold approximately 1,000,000 of her shares and received approximately $675,326 in return, of which approximately $580,780 was the proceeds of securities fraud.
As part of the plea agreement, Ransom agreed to forfeit $580,780, the proceeds of the securities fraud offense she pleaded guilty to, and to pay restitution.
The charge of securities fraud is punishable by up to five years in prison, a maximum fine of $250,000, and up to three years of supervised release.
Sentencing is set for July 27, 2015, before U.S. District Judge Edward J. Lodge at the federal courthouse in Boise.
"This defendant personally gained by deceiving investors,” said Olson. “Her guilty plea both acknowledges the wrongfulness of her conduct and sends the clear message to others that the U.S. Department of Justice and its investigating partners will take strong actions to identify and prosecute those who manipulate securities markets for personal gain.”
The case was investigated by the Internal Revenue Service, Criminal Investigation Division, and the Federal Bureau of Investigation.
Former Agape Employees Convicted on All Counts by Jury in Massive Ponzi SchemeRead the Press Release
Earlier today, after four weeks of trial, a federal jury in Central Islip, New York, returned guilty verdicts against Diane Kaylor and Jason Keryc, former employees of Hauppauge-based Agape World, Inc. (Agape), on charges of securities fraud, conspiracy, mail fraud, and wire fraud. The charges arose out of the defendants’ participation in a huge Ponzi scheme. When sentenced by United States District Judge Denis R. Hurley, the defendants face a maximum sentence of 20 years’ imprisonment on each count. Keryc was remanded.
The verdicts were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, Diego Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Philip R. Bartlett, Inspector-in-Charge, United States Postal Inspection Service (USPIS).
“Kaylor and Keryc convinced thousands of hard-working, middle class Americans to invest their life savings, their children’s college funds, or their retirement money in Agape, knowing that Agape was a Ponzi scheme,” stated United States Attorney Lynch. “The defendants’ motive was simple and all too common today: greed. The more money the defendants pried out of investors’ pockets, the larger their commission checks. The defendants gained the trust of their investors and then betrayed that trust to feed their insatiable appetites for money.” Ms. Lynch expressed her grateful appreciation to the United States Securities and Exchange Commission for their assistance in the case.
“What was intended as a get-rich-quick scheme was, in fact, a cowardly plan. A plan that deceived unwitting investors and lured them into a false sense of security, while promising unrealistic returns on their investments. Unlike those convicted today, the FBI and our partners intend to keep the promises we make to those who invest their faith in us. Those who employ schemes to capitalize on the pain and suffering of others will most certainly be brought to justice,” stated FBI Assistant Director-in-Charge Rodriguez.
“The Postal Inspectors are committed to protecting the American Consumers from falling victims to these types of frauds. We have a robust program in fraud prevention and when warranted, as such as this case, prosecuting defendants through the efforts of the United States Attorney’s Office,” stated Postal Inspector-in-Charge Bartlett.
Nicholas Cosmo founded Agape in August 2000. Earlier, Cosmo spent 21 months in a federal prison for defrauding investors. Kaylor and Keryc were aware of Cosmo’s prior fraud conviction, but, not surprisingly, did not disclose this information to their investors. Between October 2005 and January 2009, the defendants, who worked as account representatives or brokers for Cosmo, played critical roles in the operation of the Ponzi scheme by soliciting and obtaining hundreds of millions of dollars from investors. To induce investments and discourage withdrawals, the defendants misled the investors by (1) assuring investors that their investments would only be used to fund specific, short-term secured bridge loans to commercial borrowers, or to make short-term loans to small businesses; (2) promising to pay investors unusually high rates of returns; and (3) representing that investing in Agape carried little or no risk of loss. The defendants raised significantly more money than was needed for the loans, and lied to the investors by assuring them that their money would specifically be used to fund only a particular loan. For their efforts, Kaylor and Keryc made approximately $3.4 million and $8.9 million, respectively.
Cosmo and the defendants paid returns to Agape investors, not from any profits earned on investments, but rather from existing investors’ deposits or money paid by new investors. The defendants and their coconspirators took more than $370 million from approximately 5,000 investors. Of that $370 million, only $22 million actually went to fund bridge loans. Unbeknownst to investors, approximately $113 million of their money was used to trade high risk futures and commodities.
As the fraudulent scheme began to unravel, Kaylor and Keryc continued to deceive investors about Agape’s financial health and the status of various Agape bridge loans. In the summer of 2008, Agape stopped paying commissions to the defendants and asked them not to cash checks for fear that the checks would bounce. On November 3, 2008, the defendants learned that all of Agape’s 2007 bridge loans were in default or on extension but once again did not disclose this information to existing or new investors. Rather, they actively continued to solicit money from investors, obtaining an additional $13 million. As a result of the Ponzi scheme, approximately 3,800 investors sustained actual losses totaling approximately $147 million.
On October 14, 2011, Cosmo was sentenced to a term of imprisonment of 25 years in United States v. Nicholas Cosmo, 09 CR 255 (DRH), for his role in the scheme. In addition to the convictions of Cosmo, Kaylor, and Keryc, the government’s investigation led to the conviction of six other defendants for their roles in this scheme, who are pending sentence before Judge Hurley.
The government’s case is being prosecuted by the Office’s Long Island Criminal and Civil Divisions. Assistant United States Attorneys Christopher C. Caffarone, Bradley T. King, Grace M. Cucchissi and Vincent Lipari are in charge of the prosecution.
The Defendants:
DIANE KAYLOR
Age: 39
Bethpage, New York
JASON KERYC
Age: 38
Wantagh, New York
E.D.N.Y. Docket No. 12-CR-357 (S-4)(DRH)
Federal Indictment Alleges Former Southwest Kansas Banker Conspired in Money LaunderingRead the Press Release
TOPEKA, KAN. – The former president of a bank in Plains, Kan., has been indicted along with two customers of the bank on federal money laundering charges, U.S. Attorney Barry Grissom said today. Two former bank employees also are charged in the case.
The Kansas case is part of a larger investigation that has resulted in more than 20 indictments with defendants in Indianapolis, Ind.; Seminole, Texas; Boston, Mass.; El Paso, Texas; Atlanta, Ga.; Oklahoma City, Okla.; Tulsa, Okla.; Denver, Colo.; and Mexico. The investigation in Kansas resulted in the seizure of more than 5,000 pounds of marijuana and more than $2 million in cash.
An indictment unsealed today in U.S. District Court alleges a couple from Meade funneled drug proceeds through their account at Plains State Bank while the former banker failed to report on the suspicious activity, even as millions of dollars flowed through the couple’s account. The bank is located at 411 Grand Ave. in Plains, Kan.
In a 37-count indictment, the following defendants are charged:
- George Enns, 69, and his wife, Agatha Enns, 67, both of Meade, Kan., co-owners of Southwest Windmill and Waterwell, Inc.: one count of money laundering conspiracy, 34 counts of money laundering and one count of attempted money laundering.
- James Kirk Friend, 52, Plains, Kan., who was appointed President of Plains State Bank in 2005, and replaced as president in 2013 when he was made senior vice president: one count of money laundering conspiracy, one count of failing to file a Suspicious Activity Report and 29 counts of money laundering.
- Matthew Thomas, 37, Plains, Kan., loan officer and officer of Plains State Bank until he left in 2014: one count of failing to file a Suspicious Activity Report.
- Kathey F. Shellman, 57, Plains, Kan., a cashier and IT officer at Plains State Bank until she left in 2014: one count of failing to file a Suspicious Activity Report.
The indictment alleges that:
- From 2011 to August 2014 deposits to the Enns’ account were more than $6.8 million, including more than $1.6 million in cash.
- The Enns also had an account at a Bank of America branch in El Paso, Texas. From 2011 to August 2014, more than $900,000 was transferred from the Enns’ account at Bank of America to their account at Plains State Bank.
- The activity in the Enns’ two accounts was not produced by Southwest Windmill and Waterwell, Inc. The monies flowing through these accounts was not reported to the Enns’ accountant or reported on their tax returns.
- From Jan. 11, 2012, to Aug. 12, 2014, the Enns crossed the U.S. border to and from Mexico at least 25 times. On at least four occasions they were stopped by customs officials and found to be in possession of large amounts of cash. For instance, on July 26, 2013, they were stopped at the Columbus, N.M., port of entry carrying $317,500 in a black trash bag.
- Defendant George Enns told law enforcement officers that the U.S. currency was to be used to buy seeds for his seed business in Mexico.
- Defendant Friend knew the Enns were bringing bulk currency from Mexico to the United States.
- Bank officials did not require the Enns to provide proof that any of the currency transported from the United States was declared at the border and did not look into the source of the currency. They did not fill a SAR report on any transactions conducted on the Enns’ account.
Upon conviction, the alleged crimes carry the following penalties:
Conspiracy to commit money laundering: A maximum penalty of 20 years and a fine up to $250,000.
Failing to file a report: A maximum penalty of five years and a fine up to $250,000.
Money laundering: A maximum penalty of 20 years and a fine up to $500,000 on each count.
The following agencies investigated: The Drug Enforcement Administration, the Federal Deposit Insurance Corporation and the Internal Revenue Service. Assistant U.S. Attorney Debra Barnett is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
Family Dermatology PcC Agrees to Pay United States More Than $3.2 Million to Settle Alleged False Claims Act ViolationsRead the Press Release
Family Dermatology P.C. which owns and operates a dermatopathology laboratory in Georgia and a number of dermatology practices throughout the Eastern United States, has agreed to pay the United States $3,247,835 plus interest to settle allegations that it violated the False Claims Act by engaging in improper financial relationships with a number of its employed physicians, the Justice Department announced today.
“The Department of Justice has had longstanding concerns about improper financial relationships between health care providers and their referral sources, because such relationships can alter a physician's judgment about the patient's true health care needs and drive up health care costs for everybody,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer of the Department’s Civil Division. “In addition to yielding a recovery for taxpayers, this settlement should deter similar conduct in the future and help make health care more affordable.”
The settlement announced today resolved allegations that financial relationships that Family Dermatology and its affiliates had with a number of their employed physicians violated the Stark Statute and the False Claims Act. The Stark Statute restricts the financial relationships that health care providers may have with doctors who refer patients to them. Family Dermatology employs a number of dermatologists as independent contractors and it has routinely required them to use Family Dermatology’s in-house pathology lab, which operated under the name Nelson Dermatopathology, for their pathology services. The government alleged that Family Dermatology’s financial relationships with a number of these physicians did not comply with the requirements of the Stark Statute, and that Family Dermatology improperly billed Medicare for dermatopathology analyses performed by Nelson Dermatopathology on specimens that were sent to the laboratory by these employed physicians.
“The defendants financed the expansion of their business across the Eastern United States with improper financial arrangements that resulted in illegal referrals and, ultimately, inflated payments from Medicare,” said Acting U.S. Attorney John Horn of the Northern District of Georgia. “We expect providers to follow the law and will pursue those who do not.”
“Physician self-referrals that violate the Stark Statute undermine medical decision making, jeopardize patient care and cost the taxpayers money,” said U.S. Attorney A. Lee Bentley III of the Middle District of Florida. “Patients need to have confidence that the advice they receive from their physicians is based on sound medical practice, not illegal financial relationships between providers. We will continue to investigate and pursue these types of violations in our district.”
“This settlement not only demonstrates the need for oversight involving such matters under the False Claims Act, but also the FBI’s commitment toward enforcing this as well as other health care fraud based violations,” said Special Agent in Charge J. Britt Johnson of the FBI’s Atlanta Field Office.
“Health care companies that make sweetheart deals with physicians to boost profits undercut both the financial integrity of Medicare and the public’s trust in the medical profession,” said Special Agent in Charge Derrick L. Jackson of the Department of Health and Human Services’ Office of Inspector General (HHS-OIG). “Our agency will continue to hold those who engage in such improper financial schemes accountable.”
The allegations settled today arose from three separate lawsuits filed by three whistleblowers, Scott M. Ross MD, Mark F. Baucom and Harold Milstein MD under the qui tam provisions of the False Claims Act. Under the act, private citizens can bring suit on behalf of the government for false claims and share in any recovery. The whistleblowers will collectively receive more than $584,000 from the recovery announced today.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $24 billion through False Claims Act cases, with more than $15.3 billion of that amount recovered in cases involving fraud against federal health care programs.
The cases, United States ex rel. Ross v. Family Dermatology of Pennsylvania, P.C., et al., Case No. 1:11-cv-2413 (N.D. Ga.); United States ex rel. Baucom v. Family Dermatology of Pennsylvania, P.C., et al., Case No. 1:11-cv-4260 (N.D. Ga.); and United States ex rel. Milstein v. Family Dermatology, P.C., et al., Case No. 1:13-cv-1027 (N.D. Ga.), were handled by the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Offices of the Northern District of Georgia and the Middle District of Florida, and HHS-OIG.
U.S. ex rel. Milstein was originally filed in the Middle District of Florida and subsequently transferred to the Northern District of Georgia. The claims settled by this agreement are allegations only, and there has been no determination of liability.
Family Dermatology Pc Agrees to Pay United States More Than $3.2 Million to Settle Alleged False Claims Act ViolationsRead the Press Release
Tampa, FL – Family Dermatology P.C. which owns and operates a dermatopathology laboratory in Georgia and a number of dermatology practices throughout the Eastern United States, has agreed to pay the United States $3,247,835 plus interest to settle allegations that it violated the False Claims Act by engaging in improper financial relationships with a number of its employed physicians, the Justice Department announced today.
“The Department of Justice has had longstanding concerns about improper financial relationships between health care providers and their referral sources, because such relationships can alter a physician's judgment about the patient's true health care needs and drive up health care costs for everybody,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer of the Department’s Civil Division. “In addition to yielding a recovery for taxpayers, this settlement should deter similar conduct in the future and help make health care more affordable.”
The settlement announced today resolved allegations that financial relationships that Family Dermatology and its affiliates had with a number of their employed physicians violated the Stark Statute and the False Claims Act. The Stark Statute restricts the financial relationships that health care providers may have with doctors who refer patients to them. Family Dermatology employs a number of dermatologists as independent contractors and it has routinely required them to use Family Dermatology’s in-house pathology lab, which operated under the name Nelson Dermatopathology, for their pathology services. The government alleged that Family Dermatology’s financial relationships with a number of these physicians did not comply with the requirements of the Stark Statute, and that Family Dermatology improperly billed Medicare for dermatopathology analyses performed by Nelson Dermatopathology on specimens that were sent to the laboratory by these employed physicians.
“The defendants financed the expansion of their business across the Eastern United States with improper financial arrangements that resulted in illegal referrals and, ultimately, inflated payments from Medicare,” said Acting U.S. Attorney John Horn of the Northern District of Georgia. “We expect providers to follow the law and will pursue those who do not.”
“Physician self-referrals that violate the Stark Statute undermine medical decision making, jeopardize patient care and cost the taxpayers money,” said U.S. Attorney A. Lee Bentley III of the Middle District of Florida. “Patients need to have confidence that the advice they receive from their physicians is based on sound medical practice, not illegal financial relationships between providers. We will continue to investigate and pursue these types of violations in our district.”
“This settlement not only demonstrates the need for oversight involving such matters under the False Claims Act, but also the FBI’s commitment toward enforcing this as well as other health care fraud based violations,” said Special Agent in Charge J. Britt Johnson of the FBI’s Atlanta Field Office.
“Health care companies that make sweetheart deals with physicians to boost profits undercut both the financial integrity of Medicare and the public’s trust in the medical profession,” said Special Agent in Charge Derrick L. Jackson of the Department of Health and Human Services’ Office of Inspector General (HHS-OIG). “Our agency will continue to hold those who engage in such improper financial schemes accountable.”
The allegations settled today arose from three separate lawsuits filed by three whistleblowers, Scott M. Ross MD, Mark F. Baucom and Harold Milstein MD under the qui tam provisions of the False Claims Act. Under the act, private citizens can bring suit on behalf of the government for false claims and share in any recovery. The whistleblowers will collectively receive more than $584,000 from the recovery announced today.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $24 billion through False Claims Act cases, with more than $15.3 billion of that amount recovered in cases involving fraud against federal health care programs.
The cases, United States ex rel. Ross v. Family Dermatology of Pennsylvania, P.C., et al., Case No. 1:11-cv-2413 (N.D. Ga.); United States ex rel. Baucom v. Family Dermatology of Pennsylvania, P.C., et al., Case No. 1:11-cv-4260 (N.D. Ga.); and United States ex rel. Milstein v. Family Dermatology, P.C., et al., Case No. 1:13-cv-1027 (N.D. Ga.), were handled by the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Offices of the Northern District of Georgia and the Middle District of Florida, and HHS-OIG.
U.S. ex rel. Milstein was originally filed in the Middle District of Florida and subsequently transferred to the Northern District of Georgia. The claims settled by this agreement are allegations only, and there has been no determination of liability.
East Tennessee Moonshiners SentencedRead the Press Release
GREENEVILLE, Tenn. – Jack Mayfield, Jr., 49, of Newport, Tenn., and James Carrol Hickman, 41, of Dandridge, Tenn., have each been convicted and sentenced for aiding and abetting in the illegal production of distilled spirits by a person who was not an authorized distiller (illegal production of “moonshine”).
In October 2014, Mayfield pleaded guilty to the moonshining charge and two counts of possessing a machine gun. On April 2, 2015, he was sentenced to serve 33 months in federal prison, to be followed by three years of supervised release.
Hickman was convicted in December 2014 following a two-day jury trial. On Apr. 21, 2015, Hickman was sentenced to serve 33 months in federal prison, to be followed by three years of supervised release. There is no parole in the federal system.
According to evidence presented at Hickman’s trial and during Mayfield’s sentencing hearing, Mayfield owned and operated a large-scale illegal moonshine production operation in the Carson Springs area of Cocke County. The operation included over fifteen, 400-gallon moonshine stills housed in two separate buildings, and a separate proofing room where the moonshine was processed into a finished product and packaged for sale. Mayfield employed numerous people to work at the operation, including co-defendants Hickman and Michael Steve Reece. In his plea agreement, Mayfield admitted that he had produced illegal moonshine at the site from at least January 2003 until a search warrant was executed at the property in April 2013.
Reece, who was also charged in this case, pleaded guilty in November 7, 2013. His sentencing is scheduled for May 19, 2015.
This investigation was the result of the collaborative efforts of the Tennessee Bureau of Investigation, Tennessee Alcoholic Beverage Commission, Tennessee Highway Patrol, and Cocke County Sheriff’s Department. Assistant U.S. Attorneys Suzanne Kerney-Quillen and J. Christian Lampe represented the United States.
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East Grand Forks Construction Company Pays $1.85 Million to Resolve False Claims AllegationsRead the Press Release
United States Attorney Andrew M. Luger today announced that R.J. Zavoral & Sons, Inc., John Zavoral, Peter Zavoral and Craig Pietruszewski have agreed to pay $1.85 million to resolve allegations that they violated the False Claims Act and the Financial Institutions Reform, Recovery, and Enforcement Act by making false statements to the Small Business Administration (SBA) and the U.S. Army Corps of Engineers. The allegations related to the Heartsville Coulee Diversion construction contract for flood control work in and around East Grand Forks, Minnesota, mainly performed between 2004 and 2008.
“Congress created the SBA’s 8(a) program to give meaningful opportunities to deserving disadvantaged small businesses across the country,” said Assistant U.S. Attorney David W. Fuller. “We will continue to work with our agency partners to identify and pursue instances where companies attempt to take advantage of the 8(a) program and others like it.”
According to the allegations, the U.S. Army Corps of Engineers had set aside the contract for the Heartsville construction project for a qualified Section 8(a) business concern under the SBA’s Section 8(a) Business Development Program. For the purpose of qualifying for the contract award, R.J. Zavoral & Sons entered into a joint venture with a qualified Section 8(a) business. The United States alleged that the Defendants made numerous false statements to both the SBA and the Corps of Engineers in order to be awarded the Heartsville Coulee Diversion Section 8(a) contract, to retain the contract, and to claim and receive payments of federal monies made under the contract. The actions of Defendants resulted in harm to the Section 8(a) business concern and caused the United States to pay significant amounts of money to the Joint Venture with little or no benefit to the Section 8(a) Business Development Program.
“The purpose of the 8(a) Program is to promote the business development of eligible small business concerns owned and controlled by socially and economically disadvantaged individuals so that such concerns can compete on an equal basis in the American economy,” said Melvin F. Williams Jr., SBA’s General Counsel. “This settlement sends a clear message that the United States Attorney’s Office will aggressively pursue allegations of fraud against the SBA Section 8(a) Program, which is so vitally important to the nation’s economy and to the many disadvantaged small businesses that participate in the program. This settlement protects the integrity of this critical program.”
This case is the result of a cooperative investigation conducted by the Small Business Administration, the Department of Defense Office of the Inspector General, and the Defense Contract Audit Agency.
The underlying case is United States v. R.J. Zavoral & Sons, Inc.; John T. Zavoral; Peter M. Zavoral; and Craig A Pietruszewski, Civil No. 12-cv-00668 (MJD/LIB).District Man Pleads Guilty to Sexually Assaulting 17-Year-Old Victim in Broad Daylight Attack in Northeast WashingtonRead the Press Release
WASHINGTON - Gerald Canty, 24, of Washington, D.C., pled guilty today to sexually assaulting a 17-year-old woman in a mid-morning attack that took place in December 2013 in Northeast Washington, Acting U.S. Attorney Vincent H. Cohen, Jr. announced.
Canty pled guilty in the Superior Court of the District of Columbia to one count of attempted first-degree sexual abuse. The plea, which is contingent upon the Court’s approval, calls for a 10-year prison sentence to be served consecutively to a 21-year prison term Canty already is serving. The Honorable Lynn Leibovitz scheduled sentencing for June 19, 2015.
Canty earlier pled guilty in May 2014 to sexually assaulting an 18-year-old woman and attempting to kidnap three additional young women in a series of other incidents that took place between February and March of 2014, near the Minnesota Avenue Metro Station. In those matters, he pled guilty to one count of first-degree sexual abuse, one count of attempted kidnapping while armed, and two counts of attempted kidnapping. He was sentenced in July 2014 by the Honorable Jennifer Anderson to 21 years in prison, and lifetime sex offender registration. Following his prison term, Judge Anderson ordered that Canty be placed on supervised release for the rest of his life.
Today’s plea involved an attack that took place on Dec. 17, 2013. According to the government's evidence, at approximately 9:20 a.m. that day, the 17-year-old victim was walking alone in the 4600 block of Nannie Helen Burroughs Avenue NE. Canty approached her, brandished an object that she believed was a gun, and said, “Hey! Don’t move.” He demanded the victim’s property, reached his hand into her pocket and removed $3. Canty then told the victim to follow him, and walked her under a footbridge a short distance away. Under the footbridge, Canty demanded that the young woman perform a sexual act on him. She initially refused, but ultimately submitted to the defendant’s demand.
After the assault, the victim made an immediate report to the Metropolitan Police Department (MPD). Officers and detectives with MPD’s Sixth District, Youth Investigations Division, and Mobile Crime Division, responded immediately. The victim was taken to Washington Hospital Center, where she received a Sexual Assault Nurse Examination. DNA later linked Canty to the attack.
In announcing the plea, Acting U.S. Attorney Cohen commended the work of the Metropolitan Police Department, including officers and detectives from the Youth Division and the Sixth District, as well as mobile crime scene officers and technicians. He also expressed appreciation for the work of MPD’s Sexual Assault Unit, which investigated the crimes that led to Canty’s earlier plea. He acknowledged the work of the District of Columbia Department of Forensic Sciences. Finally, he praised the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialists Jason Manuel and Erica Vample; Victim/Witness Advocate Tracey Hawkins, and Assistant U.S. Attorney Amy H. Zubrensky, who investigated and prosecuted the case.
Corey Bruce Patrick Charged with Second Degree Murder Resulting from an Automobile Crash in the Great Smoky Mountains National ParkRead the Press Release
KNOXVILLE, Tenn. – On Apr. 21, 2015, Corey Bruce Patrick, 34, of Hurricane Mills, Tenn., pleaded guilty in U.S. District Court in Knoxville, to second degree murder resulting from an automobile crash involving alcohol and high-speed in the Great Smoky Mountains National Park. Patrick agreed to waive indictment and plead guilty to an information charging him with this offense.
The penalty for second degree murder is up to life in prison, a fine of up $250,000, a term of supervised release of up to five years, and a $100 special assessment. Patrick’s sentencing hearing is scheduled for 2:00 p.m., Thursday, Aug. 20, 2015, in U.S. District Court in Knoxville.
If the plea agreement is accepted by the court, Patrick and United States have agreed that he will be sentenced to serve 180 months in prison. The court will determine any fine amount, supervised release term, and restitution at the sentencing hearing.
According to facts contained in the plea agreement on file with U.S. District Court, in October 2014, Patrick drove the victim’s car at a high-rate of speed within the Great Smoky Mountain National Park, after drinking alcohol at the Ole Smoky Tennessee Moonshine distillery in Gatlinburg. In a text message sent from the victim’s cell phone at approximately 2:03 a.m., one-minute before the crash, the victim described Patrick’s driving as “hes driving fast and crazy.” At 2:04 a.m., witnesses to the crash called 911 and reported that Patrick hit a tree head-on. While attempting to remove him from the car, Patrick told rescue personnel that he had been drinking before the crash. The victim suffered multiple blunt force injuries from the crash which resulted in her death at the crash scene.
This investigation was handled by the National Park Service, Tennessee Highway Patrol, and Tennessee Bureau of Investigation. Assistant U.S. Attorney Brooklyn Sawyers represented the United States.
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Convicted Bank Robber, Drug Dealer and Two Others Sentenced to Prison for $1 Million Stolen Identity Tax Refund Fraud SchemeRead the Press Release
Four Portland, Oregon, residents were sentenced today in the U.S. District Court in Portland for a multi-year stolen identity tax refund scheme to defraud the United States of more than $1 million in tax refunds, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and Acting U.S. Attorney Billy J. Williams of the District of Oregon.
Jheraun Dunlap, Ernest Bagsby, Jermaine Moore and Brandi McCall were collectively sentenced to serve more than 14 years in prison by U.S. District Judge Robert E. Jones. Dunlap, 32, who was previously convicted of bank robbery, was sentenced to serve five years and five months in prison. Bagsby, 37, who was previously convicted of delivery of heroin in Clackamas County, Oregon, was sentenced to serve four years and three months in prison. Moore, 34, was sentenced to serve three years and nine months in prison, and McCall, 27, was sentenced to serve 12 months and one day in prison. All four defendants were ordered to pay restitution to the Internal Revenue Service (IRS) in the amount of $427,896.
According to the plea agreements and court documents, the scheme involved the filing of 208 false federal income tax returns that included fraudulent claims for tax refunds between $3,000 and $9,000 per return. Dunlap electronically filed the false tax returns using stolen identities or identities obtained by Bagsby and Moore. McCall opened stored-value debit cards in her own name to receive the refunds. The defendants directed the IRS to deposit the tax refunds onto stored-value debit cards and then the proceeds were shared among the participants in the scheme. In total, as part of the scheme, the defendants requested more than $1 million in tax refunds.
All four defendants were captured on ATM footage withdrawing cash from stored-value debit cards that held the tax refund proceeds. As part of the investigation, a search warrant was executed on the Facebook accounts of multiple co-conspirators, from which federal agents obtained photographs of stacks of cash, among other things. The United States seized and forfeited assets traced to proceeds of the scheme, including a two-carat diamond engagement ring, a Mercedes Benz 500 and a 1971 Pontiac Firebird, both of which were purchased with $20 bills.
Acting Assistant Attorney General Ciraolo and Acting U.S. Attorney Williams commended the special agents of IRS-Criminal Investigation, who investigated the case as part of the Stolen Identity Refund Fraud Task Force, and Trial Attorneys Leslie A. Goemaat and Lori A. Hendrickson of the Tax Division, who are prosecuting the case. Ciraolo also thanked the U.S. Attorney’s Office in the District of Oregon for their substantial assistance.
Convicted Bank Robber, Drug Dealer and Two Others Sentenced to Prison for $1 Million Stolen Identity Tax Refund Fraud SchemeRead the Press Release
PORTLAND, Ore. – Four Portland, Oregon, residents were sentenced today in the U.S. District Court in Portland for a multi-year stolen identity tax refund scheme to defraud the United States of more than $1 million in tax refunds, announced Acting U.S. Attorney Billy J. Williams, and Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division.
Jheraun Dunlap, Ernest Bagsby, Jermaine Moore and Brandi McCall were collectively sentenced to serve more than 14 years in prison by U.S. District Judge Robert E. Jones. Dunlap, 32, who was previously convicted of bank robbery, was sentenced to serve five years and five months in prison. Bagsby, 37, who was previously convicted of delivery of heroin in Clackamas County, Oregon, was sentenced to serve four years and three months in prison. Moore, 34, was sentenced to serve three years and nine months in prison, and McCall, 27, was sentenced to serve 12 months and one day in prison. All four defendants were ordered to pay restitution to the Internal Revenue Service (IRS) in the amount of $427,896.
According to the plea agreements and court documents, the scheme involved the filing of 208 false federal income tax returns that included fraudulent claims for tax refunds between $3,000 and $9,000 per return. Dunlap electronically filed the false tax returns using stolen identities or identities obtained by Bagsby and Moore. McCall opened stored-value debit cards in her own name to receive the refunds. The defendants directed the IRS to deposit the tax refunds onto stored-value debit cards and then the proceeds were shared among the participants in the scheme. In total, as part of the scheme, the defendants requested more than $1 million in tax refunds.
All four defendants were captured on ATM footage withdrawing cash from stored-value debit cards that held the tax refund proceeds. As part of the investigation, a search warrant was executed on the Facebook accounts of multiple co-conspirators, from which federal agents obtained photographs of stacks of cash, among other things. The United States seized and forfeited assets traced to proceeds of the scheme, including a two-carat diamond engagement ring, a Mercedes Benz 500 and a 1971 Pontiac Firebird, both of which were purchased with $20 bills.
Acting U.S. Attorney Williams and Acting Assistant Attorney General Ciraolo commended the special agents of IRS-Criminal Investigation, who investigated the case as part of the Stolen Identity Refund Fraud Task Force, and Trial Attorneys Leslie A. Goemaat and Lori A. Hendrickson of the Tax Division, who are prosecuting the case.
Photo seized from Bagsby’s Facebook account with caption: “So I was unable to rubber band up do to the fact that it just keeps pouring in . . . .”
Mercedes Benz 500 purchased with $20 bills and seized from Bagsby.
Pontiac Firebird purchased with $20 bills and seized from Dunlap.
Colfax County Man Sentenced to Prison for Violating Federal Firearms LawsRead the Press Release
ALBUQUERQUE – Tommy Acevedo, 37, of Raton, N.M., was sentenced this morning in federal court in Santa Fe, N.M., to 55 months in federal prison followed by three years of supervised release for being a felon in possession of a firearm and ammunition.
The sentence was announced by U.S. Attorney Damon P. Martinez, 8th Judicial District Attorney Donald A. Gallegos, Special Agent in Charge Thomas G. Atteberry of the Phoenix Field Division of the Bureau of Alcohol, Tobacco, Firearms and Explosives, and Chief John Garcia of the Raton Police Department.
Acevedo was arrested on Dec. 17, 2013, on an indictment charging him with violating the federal firearms laws by unlawfully possessing a firearm and ammunition and unlawfully possessing an unregistered short-barreled shotgun in Colfax County, N.M., on June 19, 2013. At the time, Acevedo was prohibited from possessing firearms or ammunition because he previously had been convicted of two counts of forgery in the 8th Judicial District Court for the State of New Mexico and of robbery in the 5th Judicial District Court for the State of New Mexico.
On Aug. 13, 2014, pled guilty to Count 1 of the indictment and admitted possessing a 20 gauge sawed-off shotgun with obliterated serial number and eight rounds of ammunition on June 29, 2013, in Raton. Acevedo also admitted that he was prohibited from possessing firearms or ammunition because of his status as a convicted felon.
This case was investigated by the Albuquerque office of the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Raton Police Department, with assistance from the 8th Judicial District Attorney’s Office. Assistant U.S. Attorney Louis E. Valencia prosecuted the case.
This case was prosecuted as part of a federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders for federal prosecution with the goal of removing repeat offenders from communities in New Mexico for as long as possible.
Cleveland man sentenced to 17 1/2 years in prison for firearms traffickingRead the Press Release
A Cleveland man was sentenced to 17 1/2 years in prison for firearms trafficking, said U.S. Attorney Steven M. Dettelbach and Donald Soranno, Special Agent in Charge of ATF’s Columbus Field Division.
Moises Perez, 45, previously pleaded guilty to one count of being a felon in possession of firearms. U.S. District Judge Patricia A. Gaughan determined Perez should be classified as an armed career criminal and sentenced him to 210 months in federal prison.
Perez sold a Ruger 9 mm pistol, an H&R .22-caliber revolver and 94 rounds of ammunition to an undercover agent in August 2014. Perez was forbidden from possessing firearm or ammunition because of nearly two-dozen convictions, including felony convictions for burglary, attempted felonious assault, unlawful sexual conduct with a minor, attempted felonious assault with a firearm, attempted intimidation, drug trafficking, robbery and being a felon in possession of a firearm, according to court documents.
“Cleveland is a safer city because this defendant is off the street,” Dettelbach said. “He has a history of violent crime going back 30 years. This operation is the result of tremendous work by the ATF, Cleveland police and all our law-enforcement partners.”
“This case represents one more step to create a ripple effect to stifle violent crime,” Soranno said. “Individuals who are illegally possessing firearms and specifically engaging in illegally trafficking firearms are at the epicenter of violence in our communities. By attacking the tools of the trade and removing illegal firearms from the streets, we all help make our streets safer for everyone.”
This case was prosecuted by Assistant U.S. Attorneys Brian M. McDonough and Kelly L. Galvin. It was part of “Operation Samson II,” an enhanced-enforcement initiative targeting the criminal possession, use and sale of firearms in Greater Cleveland. The operation resulted in 60 people being indicted and 110 firearms seized.
This initiative was a cooperative effort between the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Cleveland Division of Police, the Ohio Adult Parole Authority, the U.S. Marshals Service, the U.S. Attorney’s Office and the Cuyahoga County Prosecutor’s Office.
Cleveland man indicted for cashing $175,000 worth of dead mother's Social Security checksRead the Press Release
A federal grand jury indicted Marion Sobkowiak, 66, of Cleveland, for theft of government funds, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio.
The indictment alleges that Sobkowiak fraudulently cashed his deceased mother’s Social Security widow’s benefits checks from January 1998 until April 2014, taking a total of $175,477 in benefits to which he was not entitled.
The Social Security Administration Office of Inspector General conducted the investigation. The case is being prosecuted by Assistant United States Attorney Miranda E. Dugi and Special Assistant United States Attorney Lisa J. Sanniti.
If convicted, the court will determine the defendant’s sentence after a review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum. In most cases, it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.
Cleveland man charged with robbing Public Square bankRead the Press Release
A grand jury returned a one-count indictment charging Richard Gruly, 67, of Cleveland, with one count of bank robbery, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio.
The indictment alleges that Gruly robbed the US Bank, 200 Public Square, in Cleveland, a federally insured financial institution, on May 15, 2013.
If convicted, the sentence in this case will be determined by the court after consideration of the federal sentencing guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The case is being prosecuted by Assistant U.S. Attorney Brian M. McDonough following an investigation by the Federal Bureau of Investigation's Cleveland Division.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.
Cleveland man charged with bank fraudRead the Press Release
A federal grand jury returned a nine-count indictment charging Kenneth L. Jefferson, 60, of Cleveland, with unlawful possession of a postal key and eight counts of bank fraud, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio.
The indictment alleges Jefferson defrauded Key Bank, Charter One Bank and U.S. Bank through misrepresentations relating to numerous checks.
If convicted, the defendant’s sentence will be determined by the court after consideration of the federal sentencing guidelines that includes a review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
Assistant United States Attorney Matthew J. Cronin is prosecuting the case following an investigation by the United States Postal Inspection Service.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial where it is the government's burden to prove guilt beyond a reasonable doubt.
Clearwater Man Pleads Guilty to Theft of Government FundsRead the Press Release
Tampa, FL – United States Attorney A. Lee Bentley, III announces that Elliot Kahana (68, Clearwater) has pleaded guilty to theft of government funds. He faces a maximum penalty of 10 years in federal prison. A sentencing date has not yet been set.
According to court documents, Kahana’s mother, Anne Kahana, was a recipient of Veterans Administration (VA) benefits. She died on April 28, 2009, and all rights to benefits ceased upon her death. The VA did not receive notice of her death and, until January 2011, monthly benefit payments of $1,400 continued to be directly deposited into a bank account that she had shared with her son. The total amount paid out after the death was approximately $29,400.
This case was investigated by the Veterans Administration, with assistance from the U.S. Secret Service. It is being prosecuted by Assistant United States Attorney Amanda Kaiser.
Claremore Woman Pleads Guilty to Embezzlement and Theft from Indian Tribal OrganizationRead the Press Release
MUSKOGEE, OKLAHOMA - The United States Attorney’s Office for the Eastern District of Oklahoma, announced today that LANA CAROLE KELLEY, age 38, of Claremore, Oklahoma, pled guilty to EMBEZZLEMENT AND THEFT FROM INDIAN TRIBAL ORGANIZATION, in violation of Title 18, United States Code, Section 1163.
Charges arose from an investigation by the Choctaw Nation Tribal Police and the Federal Bureau of Investigation. The defendant was indicted in March, 2015.
The Indictment alleged that between on or about March 10, 2010 and on or about May 21, 2012, in the Eastern District of Oklahoma, the defendant, LANA CAROLE KELLEY, did embezzle, steal, knowingly and willfully convert to her own use or the use of another and willfully misapply in excess of $1,000.00 of moneys, funds and credits which was then intrusted to the custody and care of an employee of Choctaw Nation Healthcare, an Indian tribal organization.
The Honorable Steven P. Shreder, Magistrate Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, accepted the guilty plea and ordered a presentence report to be completed.
Assistant United States Attorney Dean Burris represented the United States.
Charleston man pleads guilty to federal heroin chargeRead the Press Release
Charleston, W.Va. – United States Attorney Booth Goodwin announced today that Joshua Matthews, age 32, of Charleston, plead guilty today in federal court to distribution of heroin. Matthews admitted that on August 19, 2014, he sold heroin to a confidential informant working with the Charleston Police Department’s Special Enforcement Unit in exchange for $105.00. The drug deal took place on Capitol Street in downtown Charleston. Matthews faces up to 20 years imprisonment and a $1,000,000.00 fine when he is sentenced on July 29, 2015.
This case is being prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of heroin and prescription drugs. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal heroin and pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
The case was investigated by the Charleston Police Department’s Special Enforcement Unit. The prosecution is being handled by Assistant United States Attorney John Frail.
Calvert County Man Admits to Selling Heroin That Resulted in DeathRead the Press Release
Greenbelt, Maryland - Russell Edward Johnson, age 23, of Lusby, Maryland, pleaded guilty today to distributing heroin to a person who died as a result of ingesting the heroin.
The plea agreement was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Karl C. Colder of the Drug Enforcement Administration - Washington Field Division; Calvert County Sheriff Mike Evans; and Calvert County State’s Attorney Laura Martin.
According to his plea agreement, on July 18, 2013 in St. Leonard, Maryland, Johnson sold heroin to an individual who ingested the heroin. A few hours later, Johnson again sold heroin to the individual. The individual ingested the additional heroin, and died shortly thereafter. The victim’s cause of death was determined to be heroin intoxication.
Johnson and the government have agreed that if the Court accepts the plea agreement, Johnson will be sentenced to between 10 and 12 years in prison. U.S. District Judge Paul W. Grimm has scheduled sentencing for June 18, 2015, at 1:00 p.m.
United States Attorney Rod J. Rosenstein praised the DEA, Calvert County Sheriff’s Office, and Assistant State’s Attorney Lisa Ridge of the Calvert County State’s Attorney’s Office, for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys Arun G. Rao and Daniel C. Gardner, who are prosecuting the case.
Broward Resident Pleads Guilty to Using Counterfeit Money in Broward and Palm Beach CountiesRead the Press Release
A Broward County resident used counterfeit currency to unlawfully purchase items and gamble in Broward and Palm Beach Counties.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, Paula A. Reid, Special Agent in Charge, U.S. Secret Service (USSS), Miami Field Office, William R. Latchford, Chief of Police, Seminole Police Department, and Stephen J. Stepp, Chief, Palm Beach Gardens Police Department, made the announcement.
Bernardo Lecaros, 35, of Pompano Beach, pled guilty to possessing and passing counterfeit currency and conspiracy to possess and pass counterfeit currency.
According to court documents, Lecaros used counterfeit money to pay for items he purchased and to gamble. On December 10, 2014 and again on December 14, 2014, Lecaros unlawfully used $5,400 in counterfeit currency in order to gamble at the Seminole Classic Casino in Hollywood, Florida. During the course of the investigation, Lecaros was also found to have possessed an additional $37,800 in counterfeit currency.
On March 3, 2015, Lecaros used $300 in counterfeit currency to make additional unlawful purchases at a luxury department store located inside the Palm Beach Gardens Mall in Palm Beach Gardens, Florida. Lecaros was also found to be in possession of an additional $31,500 in counterfeit currency.
Lecaros is scheduled to be sentenced on June 29, 2015 at 9:00 a.m., by U.S. District Judge Robin Rosenberg, in West Palm Beach.
At sentencing, Lecaros faces up to twenty years in prison for each count of possessing and passing counterfeit currency, and up to five years in prison for the conspiracy to possess and pass counterfeit currency charge.
Mr. Ferrer commended the investigative efforts of the USSS, the Seminole Police Department and the Palm Beach Gardens Police Department. The case is being prosecuted by Assistant U.S. Attorney’s Randy Katz and Lauren Jorgensen.
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