Latest Records
Newest first across public DOJ and U.S. Attorney press releases.
Thursday 2 April 2015
New Orleans Man Pleads Guilty to Selling Counterfeit Movie DVDs and Music CDsRead the Press Release
U.S. Attorney Kenneth A. Polite announced that DARNELL REED, age 40, of New Orleans, pled guilty today to two counts of criminal copyright infringement.
According to court documents, Special Agents from the United States Homeland Security Investigations, Investigators from the Louisiana Department of Justice/Attorney General Investigations Division (LDOJ/AG) and an investigator from the Recording Industry Association of America, Inc. (RIAA) and the Motion Picture Association of America (MPAA) conducted a controlled buy from REED, who was in a parking lot in the 1100 block of Elysian Fields Avenue. The investigator approached REED and inquired about a purchase of a movie DVD and music CDs. The DVDs and CDs were displayed in the rear of REED’s vehicle, which also hung a handwritten sign showing “3 FOR $10” and “7 FOR $20.” The investigator purchased one music CD and two movie DVDs from REED for the sum of $10. The investigator examined the DVDs and CD and determined that they were counterfeit. Law enforcement agents seized approximately 7,187 counterfeit DVDs and 7,315 counterfeit CDs from REED’s vehicle.
On each count, REED faces a maximum term of imprisonment of five years, a fine of $250,000 and three years of supervised release following any term of imprisonment. U.S. District Judge Carl J. Barbier set sentencing July 9, 2015.
U.S. Attorney Polite praised the work of the United States Department of Homeland Security, Homeland Security Investigations and Investigators from the Louisiana Department of Justice, Attorney General in investigating this matter. Assistant United States Attorney Loan "Mimi" Nguyen is in charge of the prosecution.
Darnell Reed Factual Basis
New Orleans Man Pleads Guilty to Selling Counterfeit Movie DVDs and Music CDsRead the Press Release
U.S. Attorney Kenneth A. Polite announced that DARNELL REED, age 40, of New Orleans, pled guilty today to two counts of criminal copyright infringement.
According to court documents, Special Agents from the United States Homeland Security Investigations, Investigators from the Louisiana Department of Justice/Attorney General Investigations Division (LDOJ/AG) and an investigator from the Recording Industry Association of America, Inc. (RIAA) and the Motion Picture Association of America (MPAA) conducted a controlled buy from REED, who was in a parking lot in the 1100 block of Elysian Fields Avenue. The investigator approached REED and inquired about a purchase of a movie DVD and music CDs. The DVDs and CDs were displayed in the rear of REED’s vehicle, which also hung a handwritten sign showing “3 FOR $10” and “7 FOR $20.” The investigator purchased one music CD and two movie DVDs from REED for the sum of $10. The investigator examined the DVDs and CD and determined that they were counterfeit. Law enforcement agents seized approximately 7,187 counterfeit DVDs and 7,315 counterfeit CDs from REED’s vehicle.
On each count, REED faces a maximum term of imprisonment of five years, a fine of $250,000 and three years of supervised release following any term of imprisonment. U.S. District Judge Carl J. Barbier set sentencing July 9, 2015.
U.S. Attorney Polite praised the work of the United States Department of Homeland Security, Homeland Security Investigations and Investigators from the Louisiana Department of Justice, Attorney General in investigating this matter. Assistant United States Attorney Loan "Mimi" Nguyen is in charge of the prosecution.
New Jersey Doctor Sentenced to over Three Years in Prison for Taking Bribes in Test-Referrals Scheme Involving New Jersey Clinical LabRead the Press Release
NEWARK, N.J. – A doctor with an office in North Arlington, New Jersey, was sentenced today to 37 months in prison for accepting bribes in exchange for test referrals as part of a long-running scheme operated by Biodiagnostic Laboratory Services LLC (BLS), of Parsippany, New Jersey, its president, and numerous associates, U.S. Attorney Paul J. Fishman announced.
Angelo Calabrese, 57, of Pine Brook, New Jersey, previously pleaded guilty before U.S. District Judge Stanley R. Chesler to an information charging him with one count of accepting bribes. Judge Chesler imposed the sentence today in Newark federal court.
Including Calabrese, 37 people – 25 of them physicians – have pleaded guilty in connection with the bribery scheme, which its organizers have admitted involved millions of dollars in bribes and resulted in more than $100 million in payments to BLS from Medicare and various private insurance companies. The investigation has to date recovered more than $10.5 million through forfeiture.
According to documents filed in this and other cases and statements made in court:
Calabrese admitted accepting more than $130,000 in bribes to refer at least $600,000 in lab business to BLS. From 2010 through 2013, Calabrese received over $4,500 per month from BLS through sham consulting and rental agreements.
In addition to the prison term, Judge Chesler sentenced Calabrese to serve one year of supervised release and ordered him to pay a fine of $5,000. As part of his guilty plea, Calabrese must forfeit $334,000.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Richard M. Frankel; the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert; IRS–Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen; and inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge Maria L. Kelokates, with the ongoing investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Joseph N. Minish, Senior Litigation Counsel Andrew Leven, and Jacob T. Elberg, Chief of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark, as well as Assistant U.S. Attorney Barbara Ward of the office’s Asset Forfeiture and Money Laundering Unit.
U.S. Attorney Paul J. Fishman reorganized the health care fraud practice at the New Jersey U.S. Attorney’s Office shortly after taking office, including creating a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since 2010, the office has recovered more than $635 million in health care fraud and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Food, Drug and Cosmetic Act and other statutes.
Defense counsel: Julian Wilsey Esq., Livingston, New Jersey
Nigerian National Extradited on Mississippi Federal Fraud ChargesRead the Press Release
Gulfport, Miss – Following an arrest in May, 2014 of fifteen individuals in South Africa, Canada, California, Wisconsin, and Indiana, ADEKUNLE ADEFILA, a Nigerian living in Canada, has been extradited to face charges in the Southern District of Mississippi, announced U.S. Attorney Gregory K. Davis and Raymond Parmer, Jr., Special Agent in Charge of Immigration Customs Enforcement (ICE), Homeland Security Investigations (HSI) in New Orleans.
The indictment alleges a West African transnational organized crime enterprise was involved in numerous complex financial fraud schemes over the internet. This mass marketing fraud includes romance scams, re-shipping scams, fraudulent check scams and work-at-home scams, along with bank, financial and credit card account take-overs.
The investigation was initiated in October, 2011, by HSI agents in Gulfport after U.S. law enforcement officers were contacted by a female in Mississippi who was the victim of a sweetheart scam. The victim received a package in the mail requesting that she reship the merchandise to an address in Pretoria, South Africa. The investigation later revealed that the merchandise was purchased using stolen personal identity information and fraudulent credit card information of persons in the United States. Investigators have identified hundreds of victims of this scam in the United States, resulting in the loss of millions of U.S. dollars.
The case is prosecuted by Assistant U.S. Attorneys Annette Williams and Scott Gilbert and Robert S. Tully of the Organized Crime Gang Section.
An indictment is a formal charge against a defendant. Under the law, an indictment is merely an accusation and a defendant is presumed innocent until proven guilty.
Montpelier Woman and New York City Man Indicted for Heroin ConspiracyRead the Press Release
The Office of the United States Attorney for the District of Vermont stated that Chris Ross, 51, of New York City, and Kimberly Kuncz, 45, of Montpelier were arraigned today before United States Magistrate Judge John M. Conroy in connection with an Indictment returned by the Federal Grand Jury charging Ross and Kuncz with conspiracy to distribute heroin.
According to Court papers, Ross and Kuncz were arrested during the evening of March 19, 2015, after members of the Vermont Drug Task Force, working in cooperation with the Montpelier Police Department and Vermont State Police, observed Kuncz meet Ross as he arrived in Montpelier by train. Court papers indicate that law enforcement was aware that Kuncz was involved in heroin distribution and that she expected to be resupplied that evening. During a search of Ross, Vermont State Police discovered within his pants approximately 1700 individual dosage unit bags of a substance that tested positive for heroin. Ross denied knowledge of the items found within his pants.
At their arraignment, both Kuncz and Ross entered pleas of not guilty. The Indictment is an accusation only, and Kuncz and Ross are presumed innocent unless and until they are proven guilty beyond a reasonable doubt. If convicted, Kuncz and Ross face a maximum possible penalty of 20 years in prison and a fine up to $1,000,000.
Following the arraignment, Kuncz was ordered released but remains subject to supervision by the United States Probation Office. Ross remains in the custody of the United States Marshals Service.
This matter is being investigated by the Vermont Drug Task force, working in cooperation with the Montpelier Police Department. The case is being prosecuted by Assistant United States Attorney Michael Drescher. Ross is represented by Steven Barth, Esq. Kuncz is represented by Doug Kallen, Esq.
Monroe business owner pleads guilty to SNAP/WIC benefits fraudRead the Press Release
MONROE, La. – United States Attorney Stephanie A. Finley announced today that a Monroe grocery store owner pleaded guilty to conspiracy to provide cash and ineligible items to SNAP and WIC recipients in exchange for their benefits.
Allen Woods, 60, of Monroe, pleaded guilty to one count of criminal conspiracy and one count of theft of government property before U.S. Magistrate Judge Karen L. Hayes. The plea will become final when accepted by U.S. District Judge Robert G. James.
According to evidence presented at the guilty plea hearing, Woods operated two businesses illegally at the same location on Old Sterlington Road in Monroe from December 2010 until March 2014. After his other business, Big Al’s grocery store, located on Sherrouse Street in Monroe, was permanently disqualified from the Supplemental Nutrition Assistance Program (SNAP) in March of 2010, he opened Honey’s Grocery Store on Old Sterlington Road with another Monroe resident in 2010. They were cleared to participate in the SNAP program in December of 2010. As the owner of Honey’s, Woods and others permitted SNAP and WIC recipients to exchange their benefits for ineligible items.
After Honey’s closed its operations in August 2012, Woods and Marshall Brown opened Brown’s Grocery Store in the same building as Honey’s in September of 2010. Brown’s name was used to qualify the business as a SNAP retailer. Woods, Brown, and others allowed SNAP benefits to be used to purchase ineligible items such as alcohol and tobacco from September 2012 until March 2014. Woods, Brown, and others also exchanged cash for SNAP benefits and fraudulently acquired at least $5 million from illegally trafficking SNAP and WIC benefits while operating Honey’s and Brown’s grocery stores.
Woods faces up to five years in prison for the conspiracy count and up to 10 years in prison for the theft count. He also faces forfeiture of money and property connected with the charges. A sentencing date of August 30, 2015 was set. Brown pleaded guilty March 6, 2015 to the conspiracy count. A sentencing date of July 6, 2015 was set for Brown. They also both face up to three years of supervised release and a $250,000 fine.
The U.S. Department of Agriculture, Office of Inspector General, conducted the investigation. Assistant U.S. Attorney Earl M. Campbell is prosecuting the case.
Mississippi Woman Sentenced to 40 Months in Prison for Defrauding Local BusinessRead the Press Release
U.S. Attorney Kenneth A. Polite announced that KIM PARISH, age 51, a resident of Picayune, Mississippi, was sentenced yesterday after previously pleading guilty to a two-count Bill of Information charging her with wire fraud and bank fraud.
U.S. District Judge Sarah S. Vance sentenced PARISH to 40 months imprisonment, followed by three years of supervised release, and full restitution in the amount of $540,201.
According to court documents, for approximately four years, PARISH, in her position as an accountant for a local information technology service business, defrauded the business through two schemes. The first scheme involved PARISH issuing more than 200 checks to herself and to “petty cash” by forging the signature of the business’s owner. The second scheme involved PARISH improperly crediting herself with bonus pay through the business’s payroll system. PARISH took a variety of steps to conceal the schemes and defrauded the business of approximately $540,201.
U.S. Attorney Polite praised the work of the Defense Criminal Investigative Service, the Naval Criminal Investigative Service, and the U.S. Marshals Service. Assistant United States Attorney Chandra Menon was in charge of the prosecution.
Miami-Dade Police Department Officer Indicted on Fraud ChargesRead the Press Release
A Miami-Dade Police Department Officer was arrested for participating in a 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, and J.D. Patterson, Director, Miami-Dade Police Department (MDPD), made the announcement.
Rafael Duran, 43, of Miami, made his initial appearance before U.S. Magistrate Jonathan Goodman. Duran’s arraignment is scheduled for April 16, 2015.
Duran is charged, by indictment, with conspiracy to commit wire fraud and wire fraud offenses, punishable by up to twenty years in prison.
According to allegations contained in the indictment, Duran participated in a scheme to provide false police reports to individuals operating credit repair businesses. A co-conspirator would provide Duran with the personal identifying information of credit business customers. Duran would create false police reports, using the customers’ personal identifying information. The police reports would falsely represent that the customers had reported to the Miami-Dade Police Department facts consistent with having been victims of identity theft. Duran would cause the false police reports to become official records of the Miami-Dade Police Department. A member of the conspiracy, associated with the credit businesses, would cause the false police reports created by Duran to be transmitted to credit reporting agencies in order to induce the removal of negative items from the credit histories of the alleged victims identified in the false police reports. Duran created the false police reports in order to promote the success of the credit businesses and in return would receive payment and other things of value from his co-conspirators, including credit repair services.
Mr. Ferrer thanked the FBI Miami Area Corruption Task Force and MDPD Professional Compliance Bureau. This case is being prosecuted by Assistant U.S. Attorney Michael Davis.
An indictment is only an accusation and a defendant is presumed innocent unless and until proven guilty.
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.
Mercer County man sentenced to six years in federal prison for child pornographyRead the Press Release
Bluefield, W.Va. - A 19-year old Mercer County man, Joshua Dwayne Poff, was sentenced today to six years in federal prison, followed by 15 years of supervised release for possession of child pornography, U.S. Attorney Booth Goodwin announced. Today’s sentence was handed down by Senior United States District Judge David A. Faber in Bluefield.
Poff previously admitted that on January 10, 2014, he possessed pictures of prepubescent minors engaged in sexual acts. The images were located on his personal computer located in his residence. Poff also admitted to trading video files containing child pornography via the Internet to another person who had a Google email account. U.S. Attorney Booth Goodwin said, “We are committed to the fight against criminals like Joshua Dwayne Poff who contribute to the exploitation and abuse of children. We will use every available tool to track them down and prosecute them to the fullest extent allowed by law.”
The West Virginia Internet Crimes Against Children Task Force, the West Virginia State Police, the Mercer County Sheriff’s Department, and the United States Immigration and Customs Enforcement conducted the investigation. Assistant United States Attorney Lisa G. Johnston is in charge of the prosecution.
This case is being brought as part of U.S. Attorney Goodwin’s ongoing initiative to combat child sexual exploitation and abuse in the Southern District of West Virginia.
Mercer County man sentenced to more than six years in federal prison for child pornographyRead the Press Release
BLUEFIELD, W.Va. – United States Attorney Booth Goodwin announced that a 50-year old Mercer County man, Charles Edward Lawrence, was sentenced today to six and half years in federal prison followed by ten years of supervised release for possessing child pornography, U.S. Attorney Booth Goodwin announced. Today’s sentence was handed down by Senior United States District Judge David A. Faber in Bluefield.
Lawrence previously admitted that on October 10, 2013, he possessed videos depicting prepubescent minors having sex or performing sexual acts. The investigation revealed that Lawrence kept the videos of the children on a USB flash drive discovered during the execution of a search warrant at his home.
“We will not tolerate child exploitation in our communities. Folks who engage in this kind of deviant behavior are on notice that we will use every available law enforcement tool to identify and prosecute them,” Goodwin said.
The West Virginia Internet Crimes Against Children Task Force and the Mercer County Sheriff’s Department conducted the investigation. Assistant United States Attorney Lisa G. Johnston was in charge of the prosecution.
This case is being brought as part of U.S. Attorney Goodwin’s ongoing initiative to combat child sexual exploitation and abuse in the Southern District of West Virginia.
Medtronic to Pay $4.41 Million to Resolve Allegations that it Unlawfully Sold Medical Devices Manufactured OverseasRead the Press Release
The Justice Department announced today that Medtronic plc and affiliated Medtronic companies, Medtronic Inc., Medtronic USA Inc., and Medtronic Sofamor Danek USA Inc., have agreed to pay $4.41 million to the United States to resolve allegations that they violated the False Claims Act by making false statements to the U.S. Department of Veterans Affairs (VA) and the U.S. Department of Defense (DoD) regarding the country of origin of certain Medtronic products sold to the United States.
“Today’s settlement demonstrates our commitment to ensure that our service members and our veterans receive medical products that are manufactured in the United States and other countries that trade fairly with us,” said Acting Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division. “The Justice Department will take action to hold medical device companies to the terms of their government contracts.”
“Domestic manufacture is a required component of many military and Veterans Administration contracts,” said U.S. Attorney Andrew M. Luger of the District of Minnesota. “Congress has mandated that the United States use its purchasing power to buy goods made in the United States or in designated countries. We take that mandate seriously and will not hesitate to take appropriate legal action to ensure compliance.”
According to the settlement agreement, between 2007 and 2014, Medtronic sold to the VA and DoD products it certified would be made in the United States or other designated countries. The Trade Agreements Act of 1979 (TAA) generally requires companies selling products to the United States to manufacture them in the United States or in another designated country. The United States alleged that Medtronic sold to the United States products manufactured in China and Malaysia, which are prohibited countries under the TAA.
The specific Medtronic products at issue included anchoring sleeves sold with cardiac leads and used to secure the leads to patients, certain instruments and devices used in spine surgeries, and a handheld patient assistant used with a wireless cardiac device. The agreement covers the period from Jan. 1, 2007, to Dec. 31, 2013, and for one device (the handheld patient assistant), the period from Jan. 1, 2014, to Sept. 30, 2014.
The settlement resolves allegations originally brought in a lawsuit filed by three whistleblowers under the qui tam provisions of the False Claims Act, which allow private parties to bring suit on behalf of the government and share in any recovery. The relators will receive a total of $749,700 of the recovered funds.
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 $23.9 billion through False Claims Act cases, with more than $15.2 billion of that amount recovered in cases involving fraud against federal health care programs.
The case was handled by the U.S. Attorney’s Office of the District of Minnesota with assistance from the Civil Division, DoD, Defense Logistics Agency and Defense Criminal Investigative Service and the VA’s Office of General Counsel.
The underlying case is United States of America ex rel. Samuel Adam Cox, III, Meayna Phanthavong, and Sonia Adams v. Medtronic, Inc., Medtronic USA, Inc., and Medtronic Sofamor Danek USA, Inc., Civil No. 12-cv-2562 (PAM/JSM).
The claims resolved by the settlement are allegations only; there has been no determination of liability.
Medtronic to Pay $4.41 Million to Resolve Allegations That It Unlawfully Sold Medical Devices Manufactured OverseasRead the Press Release
United States Attorney Andrew M. Luger today announced that Medtronic, plc and affiliated Medtronic companies, Medtronic, Inc., Medtronic USA, Inc., and Medtronic Sofamor Danek USA, Inc., have agreed to pay $4.41 million to the United States to resolve allegations that they violated the False Claims Act by making false statements to the United States Department of Veterans Affairs (VA) and the United States Department of Defense (DoD) regarding the country of origin of certain Medtronic products sold to the United States.
“Domestic manufacture is a required component of many military and Veterans Administration contracts,” said U.S. Attorney Luger. “Congress has mandated that the United States use its purchasing power to buy goods made in the United States or in designated countries. We take that mandate seriously and will not hesitate to take appropriate legal action to ensure compliance.”
“Today’s settlement demonstrates our commitment to ensure that our service members and our veterans receive medical products that are manufactured in the United States and other countries that trade fairly with us,” said Acting Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division. “The Justice Department will take action to hold medical device companies to the terms of their government contracts.”
According to the settlement agreement, between 2007 and 2014, Medtronic sold to the VA and DoD products it certified would be made in the United States or other designated countries. The Trade Agreements Act of 1979 (TAA), generally requires companies selling products to the United States to manufacture them in the United States or in a designated country. The United States alleged that Medtronic sold the United States products manufactured in China and Malaysia, prohibited countries under the TAA.
The specific Medtronic products at issue included anchoring sleeves sold with cardiac leads and used to secure the leads to patients, certain instruments and devices used in spine surgeries, and a handheld patient assistant used with a wireless cardiac device. The agreement covers the period from January 1, 2007 to December 31, 2013, and for one device (the handheld patient assistant), the period from January 1, 2014 to September 30, 2014.
The settlement resolves allegations originally brought in a lawsuit filed by three whistleblowers under the qui tam provisions of the False Claims Act, which allow private parties to bring suit on behalf of the government and share in any recovery.
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 $23.9 billion through False Claims Act cases, with more than $15.2 billion of that amount recovered in cases involving fraud against federal health care programs.
The case was handled by the U.S. Attorney’s Office for the District of Minnesota with assistance from the Justice Department’s Civil Division, the United States Department of Defense, Defense Logistics Agency and Defense Criminal Investigative Service, and the United States Department of Veterans Affairs, Office of General Counsel.
The underlying case is United States of America ex rel. Samuel Adam Cox, III, Meayna Phanthavong, and Sonia Adams v. Medtronic, Inc., Medtronic USA, Inc., and Medtronic Sofamor Danek USA, Inc., Civil No. 12-cv-2562 (PAM/JSM).Final Medtronic Agreement
The claims resolved by the settlement are allegations only; there has been no determination of liability.
Lowell Felon Sentenced for Illegal Firearms SalesRead the Press Release
BOSTON – A previously convicted felon was sentenced today in connection with the sale of multiple firearms, including handguns with obliterated serial numbers.
Shayne Sullivan, 25, formerly of Lowell, was sentenced by U.S. District Court Judge Richard G. Stearns to four years in prison and three years of supervised release. In January 2015, Sullivan pleaded guilty to two counts of being a felon in possession of firearms and ammunition.
On March 5, 2014, Sullivan sold a .357 caliber revolver with an obliterated serial number as well as ammunition to an undercover agent for $600. Eleven days later, Sullivan arranged for another defendant, Eric Texeira, to sell several other firearms, including two revolvers with obliterated serial numbers and a rifle, to another criminal for $1,300. Sullivan’s prior convictions include, among other offenses, armed robbery with a gun and assault and battery on a disabled person over the age of 65.
In February 2015, Texeira was sentenced to 42 months in prison after he pleaded guilty to being a felon in possession of firearms and ammunition.
United States Attorney Carmen M. Ortiz; Daniel J. Kumor, Special Agent in Charge of Bureau of Alcohol, Tobacco, Firearms and Explosives, Boston Field Division; and Lowell Police Superintendent William Taylor, made the announcement. The case is being prosecuted by Assistant U.S. Attorney Suzanne Sullivan Jacobus of Ortiz's Major Crimes Unit.
Local Man Indicted in Loan Fraud and Money Laundering SchemeRead the Press Release
COLUMBUS – A federal grand jury has charged Jason L. Gunsorek, 39, of Blacklick, Ohio, with making false statements to a federally insured financial institution in connection with loans to limited liability companies he created and controlled.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, Kathy Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation (IRS), and Christy Romero, Special Inspector General for the Troubled Asset Relief Program (SIGTARP), announced the superseding indictment returned March 31, 2015 against Gunsorek, which charges him with two counts of money laundering and with two counts of loan fraud.
According to the superseding indictment, in March 2009 Gunsorek made at least one false statement in securing a loan from CF Bank, a federally insured bank, to Fair and Fourth LLC, a limited liability company he controlled, in order to secure funds for the purpose of rehabilitating and making improvements to properties in the Columbus, Ohio area. The superseding indictment further alleges Gunsorek used 98 North High Partners, LLC, another limited liability company he organized and controlled, to make at least one other false statement in connection with another loan tied to the original loan, in which Gunsorek had a straw buyer secure a loan from CF Bank in order to purchase a parking lot located at 98 North High Street, Columbus, from a third limited liability company Gunsorek controlled, and this loan defeated the regulatory legal lending limits on CF Bank as to Gunsorek, and allowed CF Bank to disburse to Fair and Fourth LLC the proceeds of the original loan in the amount of $762,000.
The superseding indictment further alleges that once Gunsorek and Fair and Fourth LLC obtained the proceeds of the $762,000 loan from CF Bank, for the express and only purpose of rehabilitating and for making improvements to properties located at 1407-1415 North Fourth Street, 1309 Fair Avenue, and 1319 Fair Avenue, all of which are located in Columbus, Ohio, he used all those monies for other purposes at other companies he controlled, including Central Park ARC, LLC and Anchor Management Group, Inc.
In June 2009 Gunsorek allegedly committed money laundering by writing two checks from the bank account held at CF Bank in the name of Fair and Fourth LLC, one in the amount of $20,000 that was deposited in a bank account in the name of Central Park ARC, LLC and one in the amount of $295,000 that was deposited in a bank account in the name of Anchor Management Group, Inc.
Making false statements to obtain loans from a federally insured bank is punishable by up to 30 years imprisonment, and money laundering is punishable by up to 10 years imprisonment.
U.S. Attorney Stewart commended the cooperative law enforcement investigation, as well as Assistant United States Attorney Dale E. Williams, Jr., who is prosecuting the case.
An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.
Leader of Bloods Street Gang Sentenced to Life in Prison for Racketeering MurdersRead the Press Release
Earlier today, Bloods street gang leader Ronald Herron, also known as “Ra Diggs,” was sentenced to 12 terms of life in prison plus 105 years. Herron was convicted on June 26, 2014, following a month-long jury trial, of all counts, including racketeering, murder in aid of racketeering, narcotics trafficking conspiracies, robbery, and firearms offenses. The charges arose from Herron’s leadership of a violent set of the Bloods Street Gang that operated in and around the Gowanus and Wyckoff Gardens housing developments in Brooklyn.
The sentence was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, Diego G. Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office, and William J. Bratton, Commissioner, New York City Police Department.
“For years, Ronald Herron unleashed brutal, unrelenting violence on his community while glorifying his criminal lifestyle as a crack-dealing gangster. Today’s sentence put an end to all of that, for good,” stated United States Attorney Lynch. “Herron styled himself a rap artist, but the evidence proved that he was a murderous thug who sought power through violence, fear, and intimidation. Let today’s sentence send a message to other gang members who terrorize their own communities: we and our federal and city law enforcement partners will not tolerate such heinous criminal conduct.” Ms. Lynch expressed her thanks to the agents and investigators from the FBI and NYPD who worked relentlessly to dismantle this violent gang and bring Herron to justice.
At trial, the government proved that Herron committed numerous crimes of violence in support of his drug trafficking operation around two New York City public housing communities located in the Boerum Hill section of Brooklyn. In 2001, Herron murdered Frederick Brooks. Herron was acquitted of that murder in state court after witnesses refused to testify because they were threatened by Herron and his associates. After being released from state custody and consolidating his control over the drug trade in Gowanus and Wyckoff Gardens, Herron murdered Richard Russo in 2008 and Victor Zapata in 2009.
Herron boasted about his exploits in songs and videos in which he identified himself as the leader of the “Murderous Mad Dogs” set of the Bloods Street Gang and claimed that he had previously “beat a body.” Presented with overwhelming evidence of Herron’s criminal conduct, including testimony from more than 50 witnesses, the jury rejected Herron’s claim that he was merely an aspiring rap artist and not a murderer.
Herron’s conviction followed dozens of successful prosecutions over the past decade conducted by the U.S. Attorney’s Office, along with the FBI and NYPD, of violent gang members and drug dealers from the Gowanus and Wyckoff Gardens housing developments.
The sentence was imposed by United States District Judge Nicholas G. Garaufis.
The government’s case is being handled by the Office’s Organized Crime & Gangs Section. Assistant United States Attorneys Shreve Ariail, Sam Nitze, and Rena Paul are in charge of the prosecution.
The Defendant:
RONALD HERRON, also known as “Ra Diggs”
Age: 33
E.D.N.Y. Docket No. 10 CR 615 (NGG)
Late-Night Business Owner Pleads Guilty to Bribing DeKalb County Zoning Board of Appeals MemberRead the Press Release
ATLANTA – Ismail Sirdah has pleaded guilty to bribing a member of the DeKalb County Zoning Board of Appeals to secure a variance for his late-night billiard hall, Lulu Billiards in Tucker, Georgia.
“Zoning rules exist to protect neighborhoods from businesses and establishments that might disrupt the residential aspect of our communities,” said Acting U.S. Attorney John Horn. “This case illustrates how greed and cash payments can sell out the legitimate interests of our citizens.”
J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office, stated: “While the FBI’s focus in public corruption matters is primarily with that of the public official, it can readily shift to those individuals who attempt to corrupt those officials. That was seen in this case involving Mr. Sirdah, an area business owner, who purchased the vote of a DeKalb County Zoning Board member in a county action that impacted his business. This guilty plea of Mr. Sirdah for those criminal actions should serve as a reminder that the FBI will not tolerate efforts to unduly and illegally influence government officials in this manner.”
According to Acting U.S. Attorney Horn, the charges, and other information presented in court: In November 2008, the DeKalb County, Georgia, Board of Commissioners passed a zoning ordinance that regulated the operation of late-night establishments and nightclubs. As a general matter, the ordinance required that new businesses must obtain a Special Land Use Permit if they wanted to operate either as a late-night establishment or as a nightclub. The zoning ordinance provided an exception to the new rule for pre-existing late-night establishments and nightclubs, which allowed those businesses to be grandfathered in under the 2008 zoning ordinance change.
Ismail Sirdah is the owner and Chief Executive Officer of 2841 Investments, Inc., which does business as LuLu Billiards. LuLu Billiards is a pool hall and bar located in Tucker, DeKalb County, Georgia.
Based on the new zoning ordinance, in November 2011, the DeKalb County Department of Planning and Sustainability informed LuLu Billiards in writing that it was grandfathered in only as a late-night business – and thus could neither operate as a nightclub nor have a dance floor. Notwithstanding the notice, Lulu Billiards operated as a nightclub and possessed a dance floor.
In September 2012, the Department of Planning and Sustainability issued a warning to Sirdah through LuLu Billiards for operating as a nightclub with a dance floor. In the warning, Sirdah was again advised that under the new zoning ordinance, LuLu Billiards could not operate as a nightclub or have a dance floor without a Special Land Use Permit.
Sirdah responded that LuLu Billiards had operated as a nightclub prior to the 2008 zoning ordinance – and as a result, should be grandfathered in as a nightclub under the new zoning rule.
Sirdah appealed not being able to operate LuLu Billiards as a nightclub to the Zoning Board of Appeals. The Zoning Board of Appeals hears and decides zoning appeals when a property owner alleges that a county official committed a zoning error.
Prior to the hearing on the appeal, Sirdah met with Jeremy “Jerry” Clark, who was a member from the Zoning Board of Appeals. During those meetings, Sirdah made it clear to Clark, that if the Zoning Board of Appeals approved Sirdah’s petition to operate as a nightclub, Clark would be rewarded.
In November 2012, the Zoning Board of Appeals approved Sirdah’s request to operate as a nightclub. Clark voted in favor of LuLu Billiards being able to operate as a nightclub. In return for the vote, Sirdah paid Clark approximately $2000 in cash and donated approximately $1,500 to a non-profit interest with which Clark was involved.
On February 19, 2015, Clark, 42, of Lithonia, Georgia, pleaded guilty to accepting a bribe from Sirdah. Clark is scheduled to be sentenced on April 30, 2015, at 10:00 a.m., before United States District Court Judge Leigh Martin May.
On March 25, 2015, Sirdah, 53, of Duluth, Georgia, was charged via a criminal information with one count of bribery. Sirdah pleaded guilty to that charge. The sentencing hearing for Sirdah is scheduled for June 15, 2015, at 11:00 a.m., also before Judge May.
This case is being investigated by the Federal Bureau of Investigation.
Assistant United States Attorney Jeffrey W. Davis is prosecuting the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao/gan/.
Kentucky man sentenced to 30 years in prison for engaging in illicit sexual conduct with 13-year-oldRead the Press Release
A Kentucky man was sentenced to 30 years in prison for taking a 13-year-old across state lines to engage in illicit sexual activity, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland office.
Shawn J. Bivens, 34, of Vanceburg, Kentucky, previously pleaded guilty to sexual exploitation of a child, transporting visual depictions of minors engaged in sexually explicit conduct, transportation of a minor to engage in illegal sexual activity and travel with intent to engage in illicit sexual conduct.
“Bivens’ actions were predatory and this sentenced is well deserved,” Dettelbach said.
"Bivens is a predator and his actions in this case were horrific,” Anthony said. “We are thankful that through coordinated efforts with the Lorain County Sheriff’s Office and Kentucky law enforcement, we were able to bring his victim home safely. "
From January 21, 2014, through on or about February 28, 2014, and again from on or about February 28, 2014, through on or about March 2, 2014, Bivens, used, persuaded, induced, enticed and coerced a minor—that is, a 13 year-old girl—to engage in sexually explicit conduct, for the purpose of producing a visual depiction of such conduct, and knowing and having reason to know that such visual depiction would be transported, using any means or facility of interstate and foreign commerce, and in and affecting interstate and foreign commerce, according to court documents.
From on or about February 28, 2014, through on or about March 2, 2014, Bivens knowingly traveled in interstate commerce, from Kentucky to Ohio, for the purpose of engaging in illicit sexual conduct with a 13-year-old girl. During the same period, he also knowingly transported, using any means of interstate and foreign commerce and in and affecting interstate and foreign commerce, numerous computer files, which files contained visual depictions of a real minor engaged in sexually explicit conduct, according to court documents.
From on or about May 3, 2014, through on or about May 8, 2014, Bivens knowingly transported an individual who had not attained the age of 18 years, that is a 13-year-old girl, in interstate commerce from the Ohio to Kentucky, with the intent that such 13-year-old girl engage in sexual activity for which Bivens could be charged with a criminal offense.
This case is being prosecuted by Assistant United States Attorney Michael A. Sullivan. The case was investigated by the Elyria Office of the Federal Bureau of Investigation and the Lewis County, Kentucky, Sheriff’s Department.
Kenner Tax Preparer Charged with Lying on Tax Returns by Failing to Declare More Than $450,000 in Income and Aggravated Identity TheftRead the Press Release
U.S. Attorney Kenneth A. Polite announced that CHRISTIE ROBINSON, 39, of LaPlace, was charged today in a four-count Indictment with filing false statements on tax returns and three counts of aggravated identity theft.
According to the Indictment, ROBINSON is the owner and operator of a tax return preparation business in Kenner called CRR Services, LLC. ROBINSON received fees charged for the preparation of these individuals' tax returns. ROBINSON failed to include all of the substantial fees she received for income tax return preparation. In 2007, she declared $80,000 in fees and failed to disclose $195,000. In 2009, she disclosed $100,000 but failed to include an additional $67,000. In 2010, she declared $71,000 but failed to declare $149,000. Finally, in 2011 she declared $170,000 but excluded $60,000. For the four tax years (2007, 2009, 2010, and 2011), ROBINSON failed to disclose a total of $471,000 in income.
In the final three counts of the Indictment, ROBINSON is charged with aggravated identity theft for electronically filing three tax returns using individuals’ names, dates of birth and social security numbers without their permission.
If convicted on the tax charges, ROBINSON faces a possible maximum sentence of three years imprisonment, on each count and/or a fine of $100,000 and up to three years of supervised release, as well as having to reimburse the United States for the cost of the investigation.
If convicted on the aggravated identity theft, ROBINSON faces two years incarceration per count consecutive to any sentence she would receive on the tax counts, $250,000 fine, restitution to the victims, and three years supervised release.
The U. S. Attorney’s Office reiterated that the Indictment is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
Jerome R. McDuffie, Acting Special Agent in Charge of Internal Revenue Service Criminal Investigation stated: “We are pleased with today's announcement regarding the indictment of Ms. Robinson. The tax system is built on the premise that taxpayers file accurate and timely tax returns. Our office will continue to work with the U.S. Attorney’s Office in the aggressive pursuit and prosecution of individuals who intentionally violate the nation's laws. Identity theft and the submission of false income tax returns are serious crimes that will be vigorously pursued by our agency."
U.S. Attorney Polite praised the work of the Internal Revenue Service, Criminal Investigation Division in investigating this matter. Assistant United States Attorney Carter K. D. Guice, Jr. of the Fraud Unit is in charge of the prosecution.
Christie Robinson Indictment
Justice Department Reaches Settlement with edX Inc., Provider of Massive Open Online Courses, to Make its Website, Online Platform and Mobile Applications Accessible Under the Americans with Disabilities ActRead the Press Release
Acting Assistant Attorney General Vanita Gupta of the Civil Rights Division and U.S. Attorney Carmen M. Ortiz of the District of Massachusetts announced today that the Justice Department has entered into a settlement agreement with edX Inc. (edX), to remedy alleged violations of the Americans with Disabilities Act (ADA). The agreement resolves the department’s allegations that edX’s website, www.edx.org, and its platform for providing massive open online courses (MOOCs), were not fully accessible to individuals with disabilities, including individuals who are blind or have low vision, individuals who are deaf or hard of hearing and individuals who have physical disabilities affecting manual dexterity, in violation of Title III of the ADA.
edX was created by the Massachusetts Institute of Technology (MIT) and Harvard University in 2012 as a nonprofit platform for select universities to offer MOOCs to the world. The consortium’s 36 charter members include Berkeley, Georgetown, Dartmouth, Caltech, the Sorbonne and Peking University, in addition to Harvard and MIT. Today, edX has approximately 60 university and institutional members providing over 450 courses to over 3,000,000 learners. The courses are offered largely for free in subject matters as varied as business, computer sciences, hard sciences, food and nutrition and social sciences.
Today’s agreement requires edX to make significant modifications to its website, platform and mobile applications to conform to the Web Content Accessibility Guidelines (WCAG) 2.0 AA, which are industry guidelines for making web content accessible to users with disabilities. Under the agreement edX will also provide guidance and authoring tools to the entities that create and post courses on www.edx.org, many of which are independently covered by the ADA, to assist them in creating accessible course content. Because edX makes its software code freely available, any modifications to that code under this agreement will enable other MOOC providers to enhance the accessibility of their online offerings.
The four-year agreement requires edX to:
- make the edX website, its mobile applications, and learning management system software, through which online courses are offered, fully accessible within 18 months;
- ensure that its content management system, called Studio, which edX makes available to entities creating online courses, is fully accessible and supports authoring and publishing of accessible content within an additional 18 months;
- provide guidance to course creators at its member universities and other institutions on best practices for making online courses fully accessible;
- appoint a Web Accessibility Coordinator;
- adopt a Web Accessibility Policy;
- solicit feedback from learners on the accessibility of the courses;
- conduct Web Accessibility Training for employees responsible for the website, platform, and mobile applications; and
- retain a consultant to evaluate conformance of the website, platform, and mobile applications.
“Massive open online courses have the potential to increase access to high-quality education for people facing income, distance, and other barriers, but only if they are truly open to everyone,” said Acting Assistant Attorney General Gupta. “This landmark agreement is far-reaching in ensuring that individuals with disabilities will have an equal opportunity to independently and conveniently access quality higher education online. edX is to be commended for working with the Justice Department to take such steps.”
“Critical portions of education are moving online, in tandem with the rest of our social experience,” said U.S. Attorney Ortiz. “This new, educational online world readily can, and should be, built from the outset in a way that does not discriminate against those with disabilities.”
Title III of the ADA prohibits discrimination on the basis of disability by public accommodations in the full and equal enjoyment of the goods, services, facilities, privileges, advantages and accommodations of places of public accommodations. Title III of the ADA also requires public accommodations to take necessary steps to ensure individuals with disabilities are not excluded, denied services, segregated or otherwise treated differently because of the absence of auxiliary aids and services, such as accurate captioning of audible materials and labeling of visual materials. The Justice Department has long considered Title III and its implementing regulation to apply to the online services and communications of public accommodations.
To find out more about federal disability rights laws, call the Justice Department’s toll-free ADA information line at 800-514-0301 or 800-514-0383 (TDD), or access its ADA website at www.ada.gov. ADA complaints, including those involving the inaccessibility of www.edx.org, may be filed by email to [email protected].
edX Settlement Agreement
Jury Convicts Pastor of Filing False Tax ReturnsRead the Press Release
BOSTON – A Worcester tax preparer was found guilty today by a federal jury of filing false tax returns with the IRS, following a four-day trial in U.S. District Court in Worcester.
Nydia Elicier, 56, owner of Cox Elicier Tax, was found guilty by a federal jury of four counts of aiding or assisting in the preparation of false tax returns. U.S. District Court Judge Timothy Hillman scheduled sentencing for July 13, 2015. .
In 2008, Elicier, who also served as a pastor in a Worcester congregation, inflated client refunds by falsifying deductions in filings with the IRS. Specifically, Elicier generated illegal refunds for clients by claiming deductions typically reserved for educators, false gifts to charity, overinflated medical expenses, and fraudulent unreimbursed employee expenses.
The charging statute provides a sentence of no greater than three years in prison, one year of supervised release, and a $100,000 fine. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz and William P. Offord, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Jordi de Llano of Ortiz’s Major Crimes Unit.
Jacksonville Man Sentenced to 60 Years for Producing Videos of Child PornographyRead the Press Release
Jacksonville, Florida – Senior United States District Judge Harvey E. Schlesinger has sentenced Charles Franklin Hudson, Jr. (39, Jacksonville) to 60 years in federal prison for using a minor child to produce videos depicting child pornography. In addition, the Court ordered him to serve a life term of supervised release, to register as a sex offender, and to forfeit his electronic media. Hudson was arrested on January 8, 2014. He pleaded guilty on July 16, 2014.
According to court documents, on January 6, 2014, an officer with the Jacksonville Sheriff’s Office (JSO) was dispatched to a residence in response to a call regarding allegations of sexual battery on a minor child. Subsequently, detectives from the JSO Sex Crimes Unit interviewed the child, who indicated that she had been sexually abused by Hudson. Two days later, detectives obtained a search warrant for Hudson’s residence. During the execution of the warrant, officers discovered numerous items of digital media, including several computers, cameras, SD cards, CDs, and DVDs. In the attic, officers recovered a backpack containing cameras, sex devices and restraints, and several pill bottles bearing Hudson’s name. Five SD cards were found inside one of the pill bottles.
Subsequent forensic analyses of the five SD cards revealed approximately 90 video and image files depicting sexually explicit conduct involving Hudson. At least two of these videos, which had been produced by Hudson, depicted him and a minor child engaged in sexually explicit conduct.
"This prison sentence sends a strong message of deterrence to predators who think they can sexually exploit innocent children and get away with it," said Susan L. McCormick, special agent in charge of HSI Tampa. "We cannot undo the trauma to these children, but with law enforcement partners like the Jacksonville Sheriff’s Office, we will do everything in our power to bring these criminals to justice."
This case was investigated by the Jacksonville Sheriff’s Office and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. It was prosecuted by Assistant United States Attorney D. Rodney Brown.
It is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Jackson County Man Sentenced for Methamphetamine OffenseRead the Press Release
On March 27, 2015, Jeffry M. Presutti, Jr., 37, of Pomona, Illinois, was sentenced on a methamphetamine offense, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
Presutti, who had previously pled guilty to a one-count indictment charging conspiracy to manufacture methamphetamine, was sentenced to 151 months in federal prison, to be followed by 3 years of supervised release, and fined $200.00. The offense occurred between April 2013 and October 2013, in Jackson County.
Evidence at the plea hearing established that Presutti was involved with others in the manufacture of methamphetamine. Presutti sometimes manufactured methamphetamine at his Pomona residence. In October 2013, police officers and DCFS workers went to Presutti’s residence to investigate complaints that Presutti was manufacturing methamphetamine inside the residence, when children were present. Officers recovered a methamphetamine lab and observed evidence of multiple burned areas inside the residence. Presutti suffered methamphetamine-related burns when he fled from the officers. At sentencing, the district judge found that Presutti was responsible for the possession of more than 166 grams of pseudoephedrine, which was used for the manufacture of methamphetamine. Presutti’s sentenced was enhanced because his conduct created a substantial risk of harm to minors.
The investigation was conducted by the Jackson County Sheriff’s Office, Murphysboro Police Department, Union County Sheriff’s Office, and Drug Enforcement Administration. The Illinois State Police Methamphetamine Response Team and Jackson County State’s Attorney’s Office assisted in the investigation.
The case was assigned to Assistant United States Attorney Amanda A. Robertson for prosecution.
Icon Telecom and Its Owner Sentenced for Money Laundering and Making False Statements in Connection with Federal Wireless Telephone Program SubsidiesRead the Press Release
Oklahoma City, Oklahoma – WES YUI CHEW, of Edmond, Oklahoma, and his company, ICON TELECOM, INC., also of Edmond, were sentenced today by United States District Judge Tim DeGiusti for money laundering and making a false statement to the Federal Communications Commission in connection with the federal Lifeline Program, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
Judge DeGiusti ordered that Chew serve 48 months in federal prison, followed by three years of supervised release, and pay a fine of $117,166.48 (which is the anticipated cost of his federal imprisonment). Chew’s company, Icon Telecom, was sentenced to three years of probation. Chew and Icon agreed not to contest the forfeiture of more than $27 million seized during the investigation.
The current Lifeline Program, which was created in 1985, furthers the FCC’s mission to provide all Americans with access to a basic level of telephone service. Since 2005, Lifeline has provided subsidies to participating telephone companies not only for landline service, but also for wireless service for qualifying low-income customers. The Universal Service Administrative Company (“USAC”) administers the Lifeline Program on behalf of the FCC and under detailed federal regulations. To pay for the program, USAC collects fees from telephone companies, which often pass the fees on to customers as “universal service charges” on monthly telephone bills.
Most participating wireless telephone companies receive a subsidy of $9.25 per month for each qualifying low-income customer. If a qualifying customer lives on “Tribal Lands,” however, the company receives $34.25 per customer. Much of Oklahoma includes Tribal Lands that qualify for the higher monthly subsidy.
Before receiving reimbursement, participating telephone companies file forms with the FCC that report the number of Lifeline eligible customers they have served. Companies must also file annual reports to certify that customers who received Lifeline service at an earlier date remain eligible for the program.
Icon Telecom, owned exclusively by Chew, participated in the wireless Lifeline Program from July 2011 until September 2013. An information filed on June 3, 2014, alleged that in September 2011, Icon reported fewer than 2,200 wireless customers who qualified for the Lifeline program. By November 2012, that number had grown to 135,364. The information explains that although it had fewer than ten full-time employees, Icon received a total of $58,283,329 through the Lifeline Program during 2011, 2012, and 2013.
On June 12, 2014, Chew pled guilty to money laundering for his transfer of $20,455,829.10 on April 9, 2013, from an Icon account to a personal account. He admitted that when he made that transfer, he knew that Icon had tens of thousands fewer customers than it had reported to the FCC for the first three months of 2013.
Also on June 12, 2014, as the sole owner of Icon, Chew also entered a guilty to plea on behalf of the company to knowingly making a false statement to the FCC on May 13, 2013. Chew admitted that in response to a USAC audit request, Icon intentionally fabricated customer recertification forms, which included fictitious signatures.
As part of their plea, Chew and Icon agreed to the forfeiture of $20,542,740.73, which the United States seized on October 4, 2013, from a personal account at Ally Bank that belonged to Chew. They also agreed not to contest the forfeiture of $6,485,933.82 seized on October 7, 2013, from two Icon accounts at BancFirst.
Related Case
The case against Chew and Icon is related to a June 3, 2014, indictment against OSCAR ENRIQUE PEREZ-ZUMAETA, of Cancun, Mexico, alleging that Perez-Zumaeta owned and managed PSPS Sales LLC, a California entity that recruited low-income individuals to apply for Lifeline service through Icon. According to the indictment, Icon paid over one million dollars to PSPS Sales from December 2011 through April 2013. Perez-Zumaeta is charged with directing PSPS Sales workers to enroll fictitious customers for Icon by using phone book listings and forging Lifeline application forms. He also allegedly directed workers in Mexico to falsify approximately 40,000 Lifeline recertification forms for use in Icon’s fraudulent scheme.
On November 7, 2014, Perez-Zumaeta pled guilty to money laundering by depositing a $52,390.00 check from Icon into a bank account of PSPS Sales on December 7, 2012. He admitted that when he made that deposit, he knew that more than $10,000.00 of those funds was the result of criminal fraud against the FCC.
Perez-Zumaeta has been in federal custody since April 25, 2014, when he was arrested at the San Francisco airport. A federal magistrate judge ordered him detained based on a risk of flight. Perez-Zumaeta is awaiting sentencing where he faces up to ten years in prison, a fine of up to $250,000, and up to three years of supervised release.
These cases are the result of an investigation by the Office of Inspector General for the Federal Communications Commission; the Federal Bureau of Investigation; and the Internal Revenue Service Criminal Investigation. These cases are being prosecuted by Assistant U.S. Attorneys Chris M. Stephens and Scott E. Williams.
Reference is made to the information and other public filings for further information.
IRS Agents Arrest Former El Paso Businessowner and Three Employees in Connection with an Alleged Fraudulent Tax Return Preparation SchemeRead the Press Release
In El Paso this morning, IRS agents arrested 60–year-old Belia Mendoza, the owner of Mendez Tax Service, and three of her employees in connection with an alleged fraudulent tax return preparation scheme announced Acting United States Attorney Richard Durbin, Jr. and Internal Revenue Service-Criminal Investigation Special Agent in Charge William Cotter.
A 22-count federal grand jury indictment, filed last week and unsealed today, charges Mendoza, 36-year-old Margarita Hernandez, 46-year-old Denise Duchene and 47–year-old Anna Montez with one count of conspiracy to defraud the United States. The indictment also charges the defendants with multiple counts of aiding and assisting in the preparation of a false income tax return.
According to the indictment, from February 2009 until June 2011, Mendoza and the others conspired to prepare and submit to the IRS numerous fraudulent income tax returns for tax years 2008, 2009 and 2010. In order to obtain maximum refunds for their clients using the Earned Income Credit, the defendants would use false or inflated figures for unreimbursed employee business expenses (Schedules A and C), child and dependent care expenses (Form 2441), education credits (Form 8863), and false filing status. Authorities allege the total loss to the Government at as a result of this scheme is estimated to be $90,000.
“While most return preparers provide excellent service to their clients, a few unscrupulous tax preparers file false and fraudulent returns to defraud the government and their own clients. Our special agents use their investigative and financial expertise to identify and hold accountable abusive tax return preparers who knowingly prepare tax returns containing false tax credits and deductions that they are not entitled to receive. Today’s arrests should send a strong signal that we are putting those dishonest tax return preparers on notice that we are watching their activities closely to ensure compliance with the law,” stated Internal Revenue Service-Criminal Investigation Special Agent in Charge William Cotter.
Upon conviction, the defendants face up to five years in federal prison on the conspiracy charge and up to three years in federal prison for each false tax return preparation charge. Assistant United States Attorney Adrian Gallegos is prosecuting this case on behalf of the Government.
An indictment is merely a charge and should not be considered as evidence of guilt. The defendants are presumed innocent until proven guilty in a court of law.
Hyannis Man Charged with Bitcoin Purchase of Firearm and Silencer on “Darknet”Read the Press Release
BOSTON – A Hyannis man was charged today in federal court with purchasing a firearm and silencer on a “Darknet Market” website, which provides anonymity to users to buy and sell illegal goods.
Justin Moreira, 21, was arrested today and charged in a criminal complaint with one count of being a felon in possession of the firearm and silencer. According to court documents, Moreira has a previous felony conviction in Barnstable County in 2013 for possession of a controlled substance with intent to distribute.
As alleged in the criminal complaint, a Darknet Market website is an online market that operates outside the parameters of the traditional Internet, allowing individuals anonymity to buy and sell illegal items, such as firearms and drugs. Such transactions are often conducted for bitcoins. The complaint alleges that beginning in January 2015, Moreira engaged a federal undercover agent in a series of online messages during which Moreira inquired about the potential purchase of several different firearms. Ultimately, Moreira allegedly ordered a Walther PPK/S .380 caliber pistol and silencer from the agent for which he paid the equivalent of $2,500 in Bitcoins. Moreira instructed the agent to ship the package to a Post Office box in Hyannis. Federal agents monitoring the Post office box immediately arrested Moreira after he retrieved the package this morning.
The charging statute provides for a sentence of no greater than 10 years in prison, three years of supervised release, and a fine of $250,000. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz; Daniel J. Kumor, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms & Explosives, Boston Field Division; Shelly Binkowski, Inspector in Charge of the U.S. Postal Inspection Service; Bruce M. Foucart, Special Agent in Charge of Homeland Security Investigations in Boston; Colonel Timothy P. Alben, Superintendent of the Massachusetts State Police; and Barnstable Police Chief Paul MacDonald, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Mary B. Murrane of Ortiz’s Major Crimes Unit.
The details contained in the complaint are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Husband and Wife Indicted in $1.5 Million Fraud ConspiracyRead the Press Release
Baltimore, Maryland – A federal grand jury returned a superseding indictment charging Shaun Tucker, a/k/a “Shawn Turner,” and “Mark Tyler,” and his wife, Joanne Tucker, a/k/a “Joanne Krcma,” “Jill Swanson,” and “Jocelyn Turner,” both age 49, of Keymar, Maryland with stealing over $1.5 in employee benefits. The original indictment charged the defendants with embezzling from employee benefit plans and tax evasion. A superseding indictment was returned on March 24, 2015 and unsealed today, adding the charge of conspiracy to commit wire fraud.
The superseding indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Steven Anderson, of the Washington Regional Office, U.S. Department of Labor - Office of Inspector General, Office of Labor Racketeering and Fraud Investigations; Special Agent in Charge Thomas J. Kelly of the Internal Revenue Service - Criminal Investigation, Washington, D.C. Field Office; Marc I. Machiz, Director of the Philadelphia Regional Office of the Labor Department’s Employee Benefits Security Administration; and Special Agent in Charge Robert Craig of the Defense Criminal Investigative Service - Mid-Atlantic Field Office.
The Tuckers were controlling officers and majority shareholders of Quantell, Inc. and Intaset Technologies Corporation. Quantell and Intaset provided labor services, including environmental science, engineering and information technology services, to federal and state agencies and the private sector.
Quantell and Intaset entered into service contracts with the federal government that were only available to companies that certified that they would use a portion of the money paid on the contract to provide bona fide health and welfare benefits to their employees pursuant to the McNamara-O’Hara Service Contract Act (SCA). From 2005 to 2008, SCA money paid to Quantell and Intaset under federal contracts was deposited into qualified employee health and welfare plans subject to the Employee Retirement Income Security Act (ERISA). At this time, the ERISA plans had a third party administrator and trustees who were not associated with the Tuckers, Quantell, and Intaset.
According to the six count indictment, from 2008 to March 2012, the Tuckers stopped contributing SCA funds to the ERISA plans. Instead, the Tuckers diverted at least $1.2 million in SCA monies paid by the government to Quantell and Intaset under service contracts for their own personal benefit, instead of using the money for the benefit of the companies’ employees. The Tuckers used shell companies and companies that they were associated with to conceal the diversion of SCA funds to them. Shaun Tucker made false statements to the third party administrator and trustees for the ERISA plans, the Department of Labor (DOL) and the IRS concerning the health and welfare benefits provided to Quantell and Intaset employees, including falsely claiming that he was requesting plan to plan transfers of the remaining assets in the ERISA plans. The Tuckers falsely told employees that they would be receiving health and welfare benefits, when they knew in fact that the money was being diverted to buy luxury vehicles, make improvements on the Tuckers’ home in Carroll County and construct a 5,000 square foot residence in Swanton Maryland.
The Tuckers also served as the plan administrators of both companies’ employee health and welfare plans, and as representatives of the plan sponsors, Quantell and Intaset. The indictment re-alleges that from 2009 to April 2010, the Tuckers further embezzled $284,999 from employee benefit plans when they caused checks to be issued from the companies’ plan funds, which they used for their personal benefit. In 2010, Shaun Tucker falsely told representatives of DOL that there had been no transfers of any Quantell plan assets. On November 8, 2010, Shaun Tucker submitted a form to DOL falsely certifying that all of the remaining assets from the Quantell plan had been transferred to a Quantell employee plan, while knowing that the Tuckers had instead used the funds for their personal benefit, including the construction of the home in Swanton.
Finally, the indictment re-alleges that the Tuckers filed a joint tax return for 2009 in which they falsely reported income of $180,251, when in fact they knew that their income was far in excess of that amount, upon which taxes were owed.
The indictment seeks the forfeiture of at least $1.5 million, the amount of loss resulting from the fraud scheme. The indictment also seeks the forfeiture of the residence in Swanton and two vehicles.
The Tuckers face a maximum sentence of 20 years in prison and a $250,000 fine or twice the gain or loss for the wire fraud conspiracy, five years in prison and a fine of $250,000 for embezzling from an employee plan; and a maximum of five years in prison and a $100,000 fine for tax evasion.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Since the inception of FFETF in November 2009, the Justice Department has filed more than 12,841 financial fraud cases against nearly 18,737 defendants including nearly 3,500 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
United States Attorney Rod J. Rosenstein commended the U.S. Department of Labor –OIG/Office of Labor Racketeering and Fraud Investigations, IRS – Criminal Investigation, U.S. Department of Labor - Employee Benefits Security Administration and DCIS for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Harry Gruber and Judson Mihok, who are prosecuting the case.
Hilliard Man Pleads Guilty to Producing Images of Child PornographyRead the Press Release
COLUMBUS, Ohio – Jeremiah R. Malfroid, 33, of Hilliard, Ohio, pleaded guilty in U.S. District Court to production of child pornography.
Carter M. Stewart, U.S. Attorney for the Southern District of Ohio, Marlon V. Miller, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), and members of the Franklin County Internet Crimes Against Children Task Force announced the plea entered into today before U.S. District Judge Gregory L. Frost.
According to court documents, investigators with the Franklin County Internet Crimes Against Children (ICAC) task force connected files containing child pornography to the defendant’s computer. While executing a search warrant and forensic examination of Malfroid’s computer, investigators discovered 281 files of child pornography, 77 of which depicted children who have been identified by the National Center for Missing and Exploited Children (NCMEC).
Numerous additional images on Malfroid’s computer depicted Malfroid sexually abusing a female child. It was confirmed that Malfroid had access to the juvenile female between approximately 2007 and 2013, when the child was three to nine years old.
Malfroid was charged by criminal complaint in October 2014 and absconded during the investigation. He turned himself in to local authorities in California in December 2014, after being profiled on the U.S. Immigration and Customs Enforcement (ICE) Operation Predator smartphone app. A user-generated Facebook post indicating Malfroid’s fugitive status had been created the same month and shared nearly 200,000 times.
Production of child pornography is a crime punishable by up to 30 years in prison.
The Franklin County ICAC Task Force is a multi-agency effort dedicated to the fight against computer facilitated crimes against children. The following agencies are members:
Franklin County Sheriff’s OfficeUpper Arlington Police Department
Grove City Police Department
Columbus Police Department
Grandview Heights Police Department
Whitehall Police Department
Hilliard Police Department
Westerville Police Department
Homeland Security Investigations
U.S. Secret Service
Ohio ICAC
Franklin County Prosecutor's Office
This case is being brought as part of Project Safe Childhood, a nationwide initiative by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorney's Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children as well as to identify and rescue victims.
U.S. Attorney Stewart commended the cooperative investigation by HSI and the Franklin County ICAC Task Force, as well as Assistant United States Attorneys Heather A. Hill and Jessica H. Kim, who are representing the United States in this case.Hayward Man Sentenced to Three and A Half Year Term in Tax Fraud SchemeRead the Press Release
OAKLAND – Guadalupe Nieves, Jr. was sentenced today to 42 months in prison and ordered to pay restitution of $444,687 for his role in a false tax refund scheme, announced United States Attorney Melinda Haag and Internal Revenue Service, Criminal Investigation, Special Agent in Charge José M. Martinez.
Nieves, 53, of Hayward, pleaded guilty to wire fraud, in violation of 18 U.S.C. § 1343, on October 16, 2014. According to the plea agreement, Nieves admitted that he had a history of problems with substance abuse. To obtain the funds necessary to support his drug problem, Nieves intentionally devised a scheme to defraud the United States by filing false tax returns claiming tax refund payments for 2010, 2011 and 2012. Nieves obtained personal information from homeless and low income persons to submit fraudulent tax returns and fraudulently obtain tax credits and refunds.
Nieves further admitted using an identification information form, ID-Doc, to obtain detailed personal information of actual persons. Once completed, the ID-Doc gave Nieves access to the names, dates of birth, social security numbers, incomes, number of dependents, expenses and type of work of numerous persons. Nieves convinced people to complete the ID-Doc by telling them they were being screened for eligibility for an Obama Administration-sponsored stimulus program. He told the persons they could qualify for a refund even if they did not work at all during the year. Nieves admitted he intentionally sought out homeless and low-income persons to complete the ID-Doc, recruiting from various drug rehabilitation centers located throughout the San Francisco Bay Area, such as Hayward Fellowship and the East Oakland Recovery Center. Nieves also recruited persons while they were waiting in a food line outside of St. Vincent DePaul Church, located in Oakland. Nieves provided the completed ID-Docs to others for the purpose of preparing and electronically filing false federal individual income tax returns and claiming fraudulent tax credits and refunds.
In addition to improperly obtaining the information of real persons, Nieves also admitted adding false information to the forms. During the time Nieves recruited people for the tax refund scheme, Nieves was a manager at a halfway house, located in San Leandro. The halfway house address was listed as the primary residence address on the false tax returns prepared, even for taxpayers who never had lived there.
In the plea agreement, Nieves also admitted he opened a joint bank account with his partner for the sole purpose of receiving fraudulent tax refunds. Once the refunds were received in the mail or in the bank account, Nieves notified the people for whom the fraudulent forms were submitted and instructed them where to meet with him. He met a number of people in a Starbucks parking lot where he and his partner set up a table to pass out a portion of their fraudulently-obtained refund. Nieves also paid a person, with proceeds from fraudulent tax refunds, to provide security while he and his partner distributed the money in the Starbucks parking lot.
The sentence was handed down by the Honorable Yvonne Gonzalez Rogers, United States District Judge. In addition to the 42-month term of imprisonment, Judge Gonzalez Rogers also sentenced Nieves to a three-year term of supervised release and ordered him to pay a $100 special assessment. Nieves also was ordered to pay restitution in the amount of $444,687. Nieves is in federal custody and has begun serving his sentence.
Assistant U.S. Attorney Thomas Moore is prosecuting the case. The prosecution is the result of an investigation by the Internal Revenue Service, Criminal Investigation.
Four Evansville men indicted in interstate transportation of stolen vehicles schemeRead the Press Release
Large amount of construction equipment allegedly stolen and transported across state lines
PRESS RELEASE
Evansville – Josh J. Minkler, the United States Attorney, announced today that a Federal Grand Jury sitting in Evansville returned indictments against four Evansville men for their role in an interstate ring involving the theft of construction equipment and other vehicles. Those charged include:
Andrew R. Elpers, 37,
Thomas W. Elpers, 62,
Jordan T. Wedel, 30,
Jason H. Habermel, 43,
The indictment charges Andrew R. Elpers with 32 counts of interstate transportation of stolen motor vehicles and one count of money laundering. Thomas W. Elpers is charged with two counts of possession of stolen motor vehicles. Jordan T. Wedel is charged with one count of possession of stolen motor vehicles. Jason Habermel is charged with four counts of money laundering.
This matter was investigated by the FBI Safe Streets Task Force, Evansville Police Department and Vanderburgh County Sheriff’s Department.
The indictment alleges that between April 1, 2012, and December 29, 2014, Andrew Elpers unlawfully transported in interstate commerce thirty-two stolen motor vehicles, many of which were vehicles used for excavation and construction. The indictment also charges Andrew Elpers with money lauding in that he traded a stolen motor vehicle and used the proceeds for the purchase of another vehicle. The indictment alleges that Thomas W. Elpers received, possessed or had in his possession, nine motor vehicles that were stolen and that he aided and abetted others in doing so. The indictment further alleges that Jordan T. Wedel possessed five motor vehicles that were stolen and that he aided and abetted others in doing so. Finally, the indictment alleges that Jason H. Habermel engaged in money laundering by arranging for the sale and delivery of stolen vehicles to the Union County Kentucky Fiscal Court.
According to Assistant U.S. Attorney Todd Shellenbarger, who is prosecuting the case for the government, Andrew Elpers faces a term of imprisonment of up to 10 years for each count of interstate transport of stolen motor vehicles and up to 20 years for money laundering. Thomas W. Elpers, Wedel and Habermel each face up to 10 years if convicted.
An initial hearing will be held in Evansville, Indiana, before a U.S. Magistrate Judge, at a later date.
An indictment is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
###
Four Charged in International Uganda-Based Cyber Counterfeiting SchemeRead the Press Release
A federal grand jury in Pittsburgh, Pennsylvania, has indicted four people in connection with an international counterfeit currency operation headquartered in the African nation of Uganda, announced U.S. Attorney David J. Hickton for the Western District of Pennsylvania.
The indictment, returned on April 1, 2015, charges Ryan Andrew Gustafson, 27, aka “Jack Farrel” aka “Willy Clock,” a U.S. citizen currently incarcerated in Kampala, Uganda, Zackary L. Ruiz, 18, aka “Mr. Mouse,” of Las Vegas, Nevada, Jeremy J. Miller, 30, aka “Sinner,” of Seattle, Washington and Michael Q. Lin, 20, aka “Mlin” aka “Mr. Casino,” of Bethlehem, Pennsylvania, with conspiracy and counterfeiting acts committed within and outside of the U.S. from December 2013 until December 2014.
“Today we announce the dismantling of an international cyber conspiracy in which Ugandan-made counterfeit Federal Reserve Notes were being advertised, bought and sold through online criminal forums then passed in coffee shops and corner stores in neighborhoods across our country,” said U.S. Attorney Hickton. “Working cooperatively with law enforcement partners in the U.S. and abroad, we were able to quickly infiltrate and disrupt this counterfeit trafficking network and limit losses.”
“The early and aggressive application of traditional and cyber investigative expertise and the cooperation and assistance of numerous domestic and international law enforcement agencies in this case led to the quick and efficient identification of conspirators in a widespread cyber-based counterfeiting network,” said Special Agent in Charge Eric P. Zahren of the U.S. Secret Service Pittsburgh Field Office, “but as importantly, minimized financial losses in the U.S. and elsewhere, consistent with our charge to protect our currency, our commerce and, ultimately, our communities.”
According to the indictment, in late December 2013, Gustafson created his own dark web website called Community-X, which was dedicated to the manufacturing, selling, buying, distribution and passing of counterfeit Federal Reserve Notes (FRNs), which he claimed to have manufactured. The website contained forums where members discussed the counterfeit bills and shared tips on how best to pass, ship and distribute counterfeit FRNs.
In September 2014, Gustafson redesigned this website into two different sites, a Community-X HQ site, with controlled access and a Community-X Recruitment Center site, which was accessible to the public. Gustafson, Ruiz and Miller were active members of both sites. Lin was only a member of the Recruitment Site.
Gustafson and others allegedly sold these counterfeit FRNs to purchasers in the U.S. From December 2013 through February 2014, an associate of Gustafson sent DHL packages containing these counterfeit FRNs to individuals in the U.S. After February 2014, Gustafson had the counterfeit FRNs smuggled into the U.S. by hiding the counterfeit FRNs in glued together pages of fake charity pamphlets.
The indictment alleges that Ruiz, Miller and Lin had varied levels of roles and responsibilities as participants in the conspiracy. In particular, the indictment alleges that Ruiz and others unpacked the counterfeit FRNs, that Ruiz, Miller and others treated the counterfeit FRNs to prepare them for passing and used the U.S. Postal Service to mail the treated FRNs to re-shippers and to purchasers and that Lin was a purchaser of the FRNs, who offered a guide on how to pass the counterfeit notes through casinos.
The indictment alleges more than $1.4 million in counterfeit FRNs have been seized and passed worldwide, both overseas and in the U.S. as part of this scheme.
Gustafson was charged by Ugandan authorities on Dec. 16, 2014, with conspiracy, possession of counterfeit, selling/dealing in counterfeit and unlawful possession of ammunition. He is presently on trial in Uganda on their charges.
The law provides for a maximum total sentence of five years in prison, a fine of $250,000, or both, on the conspiracy count; a maximum total sentence of 20 years in prison, a fine of $250,000, or both, on the conspiracy to commit money laundering count; and a maximum total sentence of 20 years in prison, a fine of 250,000, or both, on each of the passing and receiving counterfeit money counts. 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.
U.S. Attorney Hickton commended numerous agencies and organizations for conducting the investigation leading to charges in this case, including the U.S. Secret Service in Pittsburgh, Los Angeles, California, Seattle, Washington, Las Vegas, Nevada, Philadelphia, Pennsylvania, Charlotte, North Carolina, Raleigh, North Carolina, Baltimore, Maryland, Minnesota, Miami, Florida, Washington, D.C., Cincinnati, Ohio, Denver, Colorado, Phoenix, Arizona, Rome, Italy, Pretoria, South Africa and the Criminal Investigative Division in Washington, D.C., the U.S. State Department, the U.S. Postal Inspection Service in Pittsburgh, Seattle, Las Vegas, Philadelphia and Charlotte, the Federal Bureau of Investigation – Pittsburgh Division, Homeland Security Investigations in Pittsburgh, Baltimore and Cincinnati, U.S. Customs and Border Protection and the National Cyber-Forensics & Training Alliance.
Assistant U.S. Attorney Shardul S. Desai is prosecuting this case on behalf of the government.
An indictment is an accusation. A defendant is presumed to be innocent until and unless proven guilty.
Four Charged in International Uganda-based Cyber Counterfeiting SchemeRead the Press Release
PITTSBURGH – A federal grand jury in Pittsburgh has indicted four people in connection with an international counterfeit currency operation headquartered in the African nation of Uganda, David J. Hickton, United States Attorney for the Western District of Pennsylvania, announced today.
The indictment, returned on April 1, charges Ryan Andrew Gustafson, aka Jack Farrel, aka Willy Clock, 27, a U.S. citizen currently incarcerated in Kampala, Uganda; Zackary L. Ruiz, aka Mr. Mouse, 18, of Las Vegas, Nevada; Jeremy J. Miller, aka Sinner, 30, of Seattle, Washington; and Michael Q. Lin, aka Mlin, aka Mr. Casino, 20, of Bethlehem, Pennsylvania, with conspiracy and counterfeiting acts committed within and outside of the United States from December 2013 until December 2014.
“Today we announce the dismantling of an international cyber conspiracy in which Ugandan-made counterfeit Federal Reserve Notes were being advertised, bought and sold through online criminal forums then passed in coffee shops and corner stores in neighborhoods across our country,” stated U.S. Attorney Hickton. “Working cooperatively with law enforcement partners in the United States and abroad, we were able to quickly infiltrate and disrupt this counterfeit trafficking network and limit losses.”
“The early and aggressive application of traditional and cyber investigative expertise and the cooperation and assistance of numerous domestic and international law enforcement agencies in this case led to the quick and efficient identification of conspirators in a widespread cyber-based counterfeiting network,” stated Eric P. Zahren, Special Agent in Charge, U.S. Secret Service Pittsburgh Field Office, “but as importantly, minimized financial losses in the United States and elsewhere, consistent with our charge to protect our currency, our commerce and, ultimately, our communities.”
According to the indictment, in late December 2013, Ryan Gustafson created his own Dark Web website called Community-X, which was dedicated to the manufacturing, selling, buying, distribution and passing of counterfeit Federal Reserve Notes (FRNs), which he claimed to have manufactured. The website contained forums where members discussed the counterfeit bills and shared tips on how best to pass, ship and distribute counterfeit FRNs.
In September 2014, Gustafson redesigned this website into two different sites, a Community-X HQ site, with controlled access, and a Community-X Recruitment Center site, which was accessible to the public. Gustafson, Ruiz and Miller were active members of both sites. Lin was only a member of the Recruitment Site.
Gustafson and others allegedly sold these counterfeit FRNs to purchasers in the United States. From December 2013 through February 2014, an associate of Gustafson sent DHL packages containing these counterfeit FRNs to individuals in the United States. After February 2014, Gustafson had the counterfeit FRNs smuggled into the United States by hiding the counterfeit FRNs in glued together pages of fake charity pamphlets.
The indictment alleges that Ruiz, Miller and Lin had varied levels of roles and responsibilities as participants in the conspiracy. In particular, the indictment alleges that Ruiz and others unpacked the counterfeit FRNs; that Ruiz, Miller and others treated the counterfeit FRNs to prepare them for passing and used the United States Postal Service to mail the treated FRNs to re-shippers and to purchasers; and that Lin was a purchaser of the FRNs, who offered a guide on how to pass the counterfeit notes through casinos.
The indictment alleges more than $1.4 million in counterfeit FRNs have been seized and passed worldwide, both overseas and in the U.S. as part of this scheme.
Gustafson was charged by Ugandan authorities on Dec. 16, 2014, with conspiracy, possession of counterfeit, selling/dealing in counterfeit, and unlawful possession of ammunition. He is presently on trial in Uganda on their charges.
The law provides for a maximum total sentence of five years in prison, a fine of $250,000, or both, on the conspiracy count; a maximum total sentence of 20 years in prison, a fine of $250,000, or both, on the conspiracy to commit money laundering count; and a maximum total sentence of 20 years in prison, a fine of 250,000, or both, on each of the passing and receiving counterfeit money counts. 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.
U.S. Attorney Hickton commended numerous agencies and organizations for conducting the investigation leading to charges in this case, including the U.S. Secret Service in Pittsburgh, Los Angeles, Calif., Seattle, Wash., Las Vegas, Nevada, Philadelphia, Pa., Denver, Colo., Charlotte, N.C., Raleigh, N.C., Phoenix, Ariz., Baltimore, Md., Minnesota, Miami, Fla., Washington, D.C., Cincinnati, Ohio, Rome, Italy, Pretoria, South Africa, and the Criminal Investigative Division in Washington, D.C.; the U.S. State Department; the U.S. Postal Inspection Service in Pittsburgh, Seattle, Las Vegas, Philadelphia, and Charlotte; the Federal Bureau of Investigation – Pittsburgh Division; Homeland Security Investigations in Pittsburgh, Baltimore and Cincinnati; U.S. Customs and Border Protection; and the National Cyber-Forensics & Training Alliance.
Assistant U.S. Attorney Shardul S. Desai is prosecuting this case on behalf of the government.
An indictment is an accusation. A defendant is presumed to be innocent until and unless proven guilty.
Former Waterville Valley Property Manager Pleads Guilty to Defrauding Condominium Associations, Interfering with the IRSRead the Press Release
CONCORD, NEW HAMPSHIRE – Courtney Stone, 38, of Newport, Rhode Island, pled guilty in United States District Court for the District of New Hampshire to five counts of wire fraud and one count of corruptly impeding the due administration of tax laws, announced United States Attorney John P. Kacavas.
The wire fraud counts arose from Stone’s scheme to defraud approximately twenty-seven largely vacation condominium associations in the Waterville Valley area to whom her employer provided property management services. The tax charge related to Stone’s counterfeiting Internal Revenue Service documents in an effort to convince third parties to release to her funds that the third parties were holding on behalf of Stone’s employer, which the IRS had levied to satisfy her employer’s tax debt.
Stone faces a maximum of 3 years on the tax related charge and 20 years on each of the five fraud counts. Each of the six total counts carries with it a maximum fine amount of $250,000. Sentencing is scheduled for July 28, 2015.
This case was investigated by the Bedford Field Office of the Federal Bureau of Investigation, the Treasury Inspector General for Tax Administration and the Waterville Valley (N.H.) Police Department. The case is being prosecuted by Assistant U.S. Attorney Bill Morse.
Former Principals of Vehicle Financing Company Indicted on Fraud ChargesRead the Press Release
BOSTON – The founders and principals of Inofin, Inc, a shuttered motor vehicle finance company based in Rockland, Mass., were charged in U.S. District Court in Boston today with fraud relating to their solicitation of investments that resulted in losses of over $11 million to investors.
Michael J. Cuomo, 52, of Plymouth, and Kevin J. Mann Sr., 64, of Marshfield, were indicted on one count of conspiracy to commit mail and wire fraud, three counts of mail fraud, and one count of wire fraud. Cuomo and Mann were arrested on Feb. 1, 2015.
The indictment alleges that, from 1994 through February 2011, Cuomo and Mann owned and operated Inofin, which funded loans to purchasers of used cars who could not qualify for traditional financing. In order to fund Inofin’s operations, Cuomo and Mann raised capital by securing investments from dozens of individuals. In an effort to gain access to a source of investor monies that they would otherwise not have had access to, Cuomo and Mann falsely represented to investors that the investors could effect rollovers of monies held in retirement plans to Inofin, and that Inofin was an authorized custodian of retirement monies. In fact, at no point was Inofin an authorized custodian, or trustee, of retirement funds. As a result of these misrepresentations by Cuomo and Mann, Inofin investors transferred more than $11 million in retirement funds to Inofin, practically all of which was lost after Inofin entered into involuntary bankruptcy proceedings.
The charging statutes each provide a sentence of no greater than 20 years in prison, three years of supervised release, and a fine of $250,000 or twice the gross gain or loss, whichever is greater. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz; William P. Offord, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; and Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; made the announcement today. The U.S. Attorney’s Office also acknowledges the assistance it received from the U.S. Securities and Exchange Commission, Boston Regional Office. The case is being prosecuted by Assistant U.S. Attorney Vassili Thomadakis of Ortiz’s Economic Crimes Unit.
The details contained in the indictment are allegations. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Former Owner of Las Vegas Endoscopy Center, Dipak Desai, M.D., Pleads Guilty to Federal Health Care Fraud ChargesRead the Press Release
LAS VEGAS, Nev. – Dr. Dipak Desai, the former owner of a defunct Nevada endoscopy center, pleaded guilty today to conspiracy to defraud Medicare, Medicaid and other private health insurance companies by inflating and overcharging for anesthesia services it provided, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.
“Dr. Desai intentionally defrauded the federal health care system for his own personal enrichment,” said U.S. Attorney Bogden. “He has finally taken responsibility for his conduct. We are hopeful this closes a long and sordid chapter of harm caused to the people and businesses of Nevada.”
Desai, 65, of Las Vegas, pleaded guilty before U.S. District Judge Larry R. Hicks to one count of conspiracy to commit health care fraud, one count of health care fraud, and agreed to the forfeiture of property of up to approximately $2.2 million. Desai is scheduled to be sentenced on July 9, 2015, and faces a maximum of five years in prison on the conspiracy count, 10 years in prison on the health care fraud count, and maximum fines of $250,000 on each count.
Last July, Desai’s co-defendant and chief operating office of the endoscopy center, Tonya Rushing, pleaded guilty to one count of conspiracy to commit health care fraud, and is scheduled to be sentenced on May 4, 2015.
According to Desai’s guilty plea agreement, between about January 2005 and February 2008, Desai and Rushing conspired to overcharge Medicare, Medicaid, and other private health insurance companies at the Endoscopy Center of Southern Nevada by significantly overstating the amount of time the certified registered nurse anesthetists spent with patients on a given procedure. Desai and Rushing created a separate company, Healthcare Business Solutions, owned by Rushing, to handle the billing for the anesthesia services. This company received approximately nine percent of all money collected for anesthesia services rendered at the endoscopy center. Desai and Rushing imposed intense pressure on the endoscopy center employees to schedule and treat as many patients as possible in a day, and instructed the nurse anesthetists to overstate in their records the amount of time they spent on the anesthesia procedures. Desai and Rushing also instructed the office staff to rely on the false anesthesia records when preparing the claims for reimbursement which were sent to Medicare, Medicaid and the insurance companies. The plea agreement states that the parties agreed that the amount of loss to the victims is approximately $2.2 million.
This case was investigated by the FBI, Office of the Nevada Attorney General, Health and Human Services Office of Inspector General, Department of Labor Office of Inspector General, Food and Drug Administration Office of Criminal Investigations, and the United States Postal Inspection Service, and prosecuted by Assistant U.S. Attorney Crane M. Pomerantz and Mark N. Kemberling, who was designated as a Special Assistant U.S. Attorney on this case and is Chief Deputy Nevada Attorney General.
According to a recent report by the Inspector General for the U.S. Department of Health and Human Services, for every dollar the Departments of Justice and Health and Human Services have spent fighting health care fraud, they have returned an average of nearly eight dollars to the U.S. Treasury, the Medicare Trust Fund and others. To learn more or to report Medicare fraud, go to http://www.stopmedicarefraud.gov/
Former Nightclub Owner Convicted of Drug and Gun CrimesRead the Press Release
A 40-year-old Olympia, Washington man was convicted today of drug distribution and illegal firearms charges in U.S. District Court in Seattle, announced Acting United States Attorney Annette L. Hayes. STEVEN ASIR THOMAS, was convicted of Conspiracy to Distribute Controlled Substances, Money Laundering, Conspiracy to Possess Firearms in Furtherance of a Drug Trafficking Crime and being a Felon in Possession of a Firearm following a six day jury trial. The jury deliberated about one day before returning the guilty verdicts. THOMAS faces a mandatory minimum ten years in prison and up to life in prison when sentenced by U.S. District Judge John C. Coughenour on June 29, 2015.
According to records in the case and testimony at trial, THOMAS had owned various nightclubs in the Seattle area, and sought to open a new nightclub near the Seattle Center called “Ice Nightclub”. THOMAS discussed his plans with a person working with law enforcement as well as with an undercover agent. THOMAS claimed the club would be a cover to launder drug money, and would generate cash for additional drug purchases. In October 2013, THOMAS worked to set up a drug deal trading methamphetamine for assault rifles. On three other occasions, law enforcement seized drugs that were either delivered or ordered by THOMAS. In October 2013, THOMAS picked up a pound of methamphetamine from a source and then “sold” it to an undercover agent in Portland, Oregon. About a week later, another two pound load of methamphetamine was seized on a bus headed to Portland – the courier was bringing it to THOMAS. Finally, in March 2014, THOMAS arranged another one pound sale in Portland of highly pure methamphetamine to an undercover agent.
THOMAS used bank accounts set up in the name of ICE Nightclub to launder money he believed to be the proceeds of drug dealing. Some of the money was provided to THOMAS by undercover agents acting as drug dealers. The basic scheme was for purported drug dealers to give him cash disguised as an investment in the club. Then THOMAS would write a check from ICE Nightclub accounts to an entity connected to the purported drug dealers to make it appear that the ICE Nightclub was paying for services rendered. THOMAS collected a fee from the “drug dealers” for his conduct as well.
Finally, on March 27, 2014, law enforcement executed a search warrant at THOMAS’s residence. They found a loaded Glock 9 mm Model 19 firearm next to his bed. Also in the residence was evidence of drug dealing including cocaine, 14 cell phones, scales, currency bands and evidence of a previous marijuana grow. THOMAS is prohibited from possessing guns due to a felony drug conviction in 2006 in Arkansas.
This was an Organized Crime and Drug Enforcement Task Force (OCDETF) investigation, providing supplemental federal funding to the federal and state agencies involved. The case was investigated by U.S. Immigration and Custom Enforcement’s Homeland Security Investigations (HSI), the Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF) and the Seattle Police Department.
The case was prosecuted by Assistant United States Attorneys Jerrod Patterson, Lisca Borichewski and Nicholas Manheim.
Former DeKalb County and Georgia World Congress Center Official Pleads Guilty to Public Corruption ChargesRead the Press Release
ATLANTA - Patrick Jackson, a former janitorial services manager for the DeKalb County Government and Georgia World Congress Center (GWCC), has pleaded guilty to conspiracy to commit honest services fraud, admitting that he used his position as a public official to obtain benefits for himself.
“Jackson abused his position as a public official by accepting a bribe in exchange for helping a company attain and maintain government contracts at both the Georgia World Congress Center and DeKalb County,” said Acting U.S. Attorney John A. Horn. “This dishonest conduct threatens to undermine the integrity of the contracting system and the quality of the goods and services produced pursuant to those contracts. Today Jackson admitted his wrongdoing.”
J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office, stated: “The FBI will continue to make public corruption cases at all levels a priority matter and asks that anyone with information regarding such matters to contact their nearest FBI field office.”
According to Acting U.S. Attorney Horn, the charges, the plea agreement, and other information presented in court: From 2006 through 2012, Jackson simultaneously worked for two governmental entities: DeKalb County and GWCC. He served as the manager of janitorial services for both entities without the knowledge of either entity. In court, Jackson admitted to using his position as a public official to obtain favors from a company (identified in the Indictment as “Company A”) that provided janitorial services to both DeKalb County and GWCC. Jackson worked for “Company A” before he began working for DeKalb County and GWCC.
While employed by DeKalb County and GWCC, Jackson lived in a luxury apartment in Atlanta, Georgia, that “Company A” furnished and paid for. In exchange, Jackson used his position as a public official to benefit “Company A” in its business dealings with DeKalb County and GWCC. During that time, “Company A” obtained governmental contracts well in excess of one million dollars with the entities. Jackson did not disclose to either employer that “Company A” paid for his apartment. By accepting these bribes, Jackson deprived his employers of their right to his honest services.
Patrick Jackson, 56, of Loganville, Georgia, pleaded guilty before United States District Judge William Duffey. Jackson was indicted by a federal grand jury on September 9, 2014.
This case is being investigated by the Federal Bureau of Investigation and the Georgia Bureau of Investigation.
Assistant United States Attorneys Jamie L. Mickelson and Kamal Ghali are prosecuting the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao/gan/.
Former Convergex Global Markets Trader Pleads Guilty for Scheme to Falsify Books and RecordsRead the Press Release
A former trader at ConvergEx Global Markets Limited (CGM Limited) pleaded guilty this morning in federal court in New Jersey for his role in a scheme to falsify the books and records of a registered U.S. broker-dealer.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Paul J. Fishman of the District of New Jersey, Assistant Director in Charge Andrew G. McCabe of the FBI’s Washington Field Office and Inspector in Charge Philip R. Bartlett of the U.S. Postal Inspection Service (USPIS) made the announcement.
Michael Craig Marshall, 47, of Bermuda, pleaded guilty before U.S. District Judge Jose L. Linares of the District of New Jersey, to one count of conspiracy to falsify the books and records of a broker-dealer.
According to court documents, CGM Limited and G-Trade Services, LLC (G-Trade) were both wholly owned subsidiaries of ConvergEx Group LLC (ConvergEx Group). G-Trade was a registered U.S. broker-dealer. As part of his plea today, Marshall admitted that clients placed orders to buy or sell securities with G-Trade, and G-Trade then routed the orders to CGM Limited. Marshall further admitted that traders at CGM Limited regularly added a mark-up (an additional amount paid for the purchase of a security) or mark-down (a reduction of the amount received for the sale of a security) when executing the orders. Employees of CGM Limited, G-Trade and other ConvergEx Group entities referred to mark-ups and mark-downs as “spread,” “trading profits” or “TP.”
At his plea hearing today, Marshall admitted that he and the other coconspirators falsified G-Trade’s books and records. In particular, Marshall admitted that he reviewed falsified transaction reports for two trades executed in August 2009 to verify that the falsified data regarding the quantities, prices and times of the purchases reflected on the report matched actual trades that had been executed on the market on Aug. 7, 2009, by both G-Trade’s client and other market participants. The reports hid the fact that spread had been taken on the brokerage orders, Marshall admitted. These reports were later provided to G-Trade’s client.
On Dec. 18, 2013, Jonathan Daspin, the head trader at CGM Limited, Thomas Lekargeren, a sales trader at a different ConvergEx subsidiary, and CGM Limited each pleaded guilty to conspiracy to commit securities and wire fraud. On the same day, ConvergEx Group entered into a deferred prosecution agreement. Collectively, the two ConvergEx entities paid $43.8 million in criminal penalties and restitution.
The case is being investigated by the FBI’s Washington Field Office and the USPIS offices in Washington, D.C. and New York. The case is being prosecuted by Senior Trial Attorneys Jason Linder and Patrick Pericak of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Leslie Schwartz of the District of New Jersey. Fraud Section Assistant Chief Robert Zink and Trial Attorney Justin Goodyear also assisted with the investigation. The Department appreciates the substantial assistance of the Securities and Exchange Commission.
Federal Jury Finds Albuquerque Man Guilty of Violating the Hobbs Act by Robbing Businesses Engaged in Interstate CommerceRead the Press Release
ALBUQUERQUE – Last night a federal jury sitting in Santa Fe, N.M., returned a verdict finding David Savoy Thomas guilty of four counts of violating the Hobbs Act by robbing and attempting to rob commercial businesses involved in interstate commerce after a three-day trial. The guilty verdict was announced by U.S. Attorney Damon P. Martinez, Special Agent in Charge Carol K.O. Lee of the FBI’s Albuquerque Division, and Albuquerque Police Chief Gorden Eden, Jr.
Thomas, 55, of Albuquerque, N.M., was charged with four counts of violating the Hobbs Act by robbing and attempting to rob commercial businesses located in Bernalillo County, N.M., that were involved in interstate commerce, and one count of brandishing a firearm during and in relation to a crime of violence in a five-count indictment filed on Dec. 4, 2013. Thomas was arrested on Dec. 30, 2013, after he was transferred from state custody to federal custody to face the charges in the federal indictment. Trial of the case began on March 30, 2015, and concluded last night when the jury returned a verdict of guilty on the four Hobbs Act charges and was unable to reach a unanimous verdict on the firearms charge.
The evidence at trial established that Thomas robbed one business in May 2010 and three businesses in 2013. A store clerk employed by a McDonald’s Restaurant located on San Pedro NE in Albuquerque testified about being robbed on May 1, 2010, by a man who ran behind the counter, shoved him away from the register, and took money from his cash register. As the robber ran out of the restaurant, he placed his hands on the restaurant’s glass door, leaving his fingerprints behind.
A second store clerk, employed at a Family Dollar Store on Lomas NE in Albuquerque, testified that three years later, on Aug. 10, 2013, he was robbed by a man who held a large knife against his back, ordered him to open the cash register, and took cash from the cash register. Six days later, on Aug. 16, 2013, a man attempted unsuccessfully to rob the same Family Dollar Store. A third store clerk testified that the man threatened her with a knife before fleeing the store empty-handed after she resisted his efforts to rob the store.
A fourth store clerk at a Check and Go Store located on Lomas NE in Albuquerque testified that she was robbed by a man brandishing a firearm on Oct. 19, 2013. The clerk testified that she opened the store’s safe after the robber threatened her with a gun, and that the robber made off with a large amount of money.
APD officers testified that they responded to the scene of each of the four incidents and processed all available evidence, including fingerprints and surveillance videotape. After the fourth incident in Oct. 2013, an APD officer learned that a fingerprint expert had identified Thomas’s fingerprints on the glass door of the restaurant that was robbed in May 2010, and started an investigation into Thomas. After obtaining a photograph of Thomas and determining that Thomas matched the description of the man who robbed the Family Dollar and the Check and Go, the APD officer included Thomas’s photograph in a photo array of six men. The clerks from the two stores positively identified Thomas as the man who attempted to rob the Family Dollar on Aug. 16, 2013 and the Check and Go on Oct. 19, 2013.
The defense called two witnesses during its case. The first, a professor who testified as an expert, tried to call into question the reliability of eye witness testimony. The second, a former law enforcement officer, testified that he could not tell from surveillance videotape if the robber had brandished a real firearm during the Oct. 19, 2013, robbery.
Thomas has been in federal custody since his arrest and remains detained pending his sentencing hearing, which has yet to be scheduled. At sentencing, Thomas faces a statutory maximum penalty of 20 years in prison on each of the four Hobbs Act charges. If deemed to be a career criminal, Thomas faces a penalty of 30 years to life imprisonment on these charges.
This case was investigated by the Albuquerque office of the FBI and the Albuquerque Police Department with assistance from the Second Judicial District Attorney’s Office. Assistant U.S. Attorneys Norman Cairns and Kimberly A. Brawley are prosecuting the case.
This case is being prosecuted as part of a federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders for federal prosecution with the goal of removing repeat offenders from communities in New Mexico for as long as possible.
Federal Jury Convicts Covington Man for Illegal Possession of Firearm and AmmunitionRead the Press Release
Memphis, TN – A Covington man was found guilty today for being a felon in possession of a .40 caliber Ruger and 50 rounds of ammunition.
Albert Dajaun White, 37, of Covington, TN, was convicted this morning by a federal jury on one count of being a felon in possession of a firearm and one count of being a felon in possession of ammunition.
The evidence presented during a three-day trial showed that on October 7, 2013, investigators with the Tipton County Sheriff’s Office executed a search warrant at White’s residence. During the search, the officers recovered a .40 caliber Ruger, 50 rounds of ammunition, a pound of marijuana, 23 pit bulls and $32,240 dollars. The officers also recovered a $100 bill that was used in an undercover drug purchase two days prior to the search. White was arrested and indicted by a federal grand jury on January 30, 2014.
"The jury’s verdict underscores our commitment to work with our law enforcement partners in combating violent crime in Western Tennessee," said United States Attorney Edward Stanton III. "We will continue to utilize every available resource to make our communities a safer place to live."
"This is yet another example of the continued partnership between my office and the United States Attorney’s Office fight to combat gun and drug crimes in the Western District of Tennessee," said District Attorney General Mike Dunavant.
As a result of today’s guilty verdict, White faces a sentence of up to 10 years in federal prison. White is scheduled to be sentenced by United States District Judge John T. Fowlkes on July 9, 2015.
This case was investigated by the Tipton County Sheriff’s Office; Bureau of Alcohol, Tobacco, Firearms and Explosives; and the Attorney General’s Office for the 25th Judicial District. The government’s case is being prosecuted by Special Assistant U.S. Attorney Sam Stringfellow and Assistant U.S. Attorney Daniel French.
Eight Defendants Plead Guilty in $20 Million Stolen Identity Refund Fraud RingRead the Press Release
Montgomery, Alabama – Alabama and Georgia residents pleaded guilty for their roles in a $20 million stolen identity refund fraud (SIRF) conspiracy, U.S. Attorney George L. Beck Jr. of the Middle District of Alabama and acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division announced today.
The defendants pleaded guilty on the following dates to the following charges:
- Talarius Paige, of Phenix City, Alabama, on March 31, to one count of conspiracy to file false claims and one count of aggravated identity theft;
- Tracy Mitchell, of Phenix City, Alabama, on March 30, to one count of conspiracy to file false claims, one count of wire fraud and one count of aggravated identity theft;
- Latasha Mitchell, of Phenix City, Alabama, on March 30, to one count of conspiracy to file false claims and one count of aggravated identity theft;
- Demeisha Mitchell, of Phenix City, Alabama, on March 26, to one count of conspiracy to file false claims and one count of aggravated identity theft;
- Keisha Lanier, of Seale, Alabama, on March 5, to one count of wire fraud and one count of aggravated identity theft;
- Sharondra Johnson, of Phenix City, Alabama, on Feb. 17, to one count of conspiracy to file false claims;
- Cynthia Johnson, of Phenix City, Alabama, on Dec. 17, 2014, to one count of conspiracy to file false claims; and
- Patrice Taylor, of Midland, Georgia, on July 18, 2014, to one count of conspiracy to file false claims.
The defendants are scheduled to be sentenced on June 30. Mequetta Snell-Quick, another co-conspirator from Phenix City, Alabama, is scheduled to appear in court on April 6. In a related case, on Oct. 2, 2014, Tamika Floyd, of Salem, Alabama, pleaded guilty to one count of conspiracy to file false claims and one count of aggravated identity theft and is scheduled to be sentenced on May 19. The defendants each face a statutory maximum sentence of 10 years in prison for each count of conspiracy to file false claims, a statutory maximum sentence of 20 years in prison for each wire fraud count, and a statutory mandatory minimum sentence of two years in prison for each aggravated identity theft count.
“The guilty pleas of the nine defendants who participated in this conspiracy send a clear message that the Tax Division, along with its law enforcement partners, will vigorously pursue and prosecute individuals involved at every level of these extensive criminal schemes,” stated Acting Assistant Attorney General Ciraolo. “The division will seek significant jail time and restitution from offenders who choose to victimize unsuspecting American taxpayers, including the dedicated men and women serving in the U.S. military, and steal from the U.S. Treasury.”
“Stealing a person’s identity is a horrendous crime,” said U.S. Attorney Beck. “It can take months or years for a victim of identity theft to correct the damage that these criminals reaped upon him or her. But these defendants stole identities from military men and women who have volunteered to protect our country. That is inexcusable and will not be tolerated.”
According to court documents, between January 2011 and December 2013, the defendants ran a large-scale identity theft ring in which they filed more than 7,000 false tax returns that included fraudulent claims for refunds in excess of $20 million. In order to file false returns, the defendants obtained stolen identities from various sources. Tracy Mitchell worked at a military hospital located at Fort Benning, Georgia, and as a hospital employee, she had access to the identification data of military personnel, including soldiers who were deployed to Afghanistan. Tracy Mitchell stole soldiers’ personal information and used that information to file false tax returns.
“This case is an excellent example of Army CID working shoulder-to-shoulder with our fellow law enforcement partners to protect the nation’s soldiers,” said Director Daniel Andrews of the U.S. Army Criminal Investigation Command’s (CID) Computer Crime Investigative Unit. “It demonstrates our vigilance against cybercrime and an unswerving commitment to dismantle criminal operations impacting the U.S. Army.”
Floyd stole personal information from two Alabama state agencies and provided those names to Lanier. Lanier provided those names to Tracy Mitchell, Latasha Mitchell, Paige and others for use in filing false tax returns. Lanier also obtained stolen identities from the Alabama Department of Corrections that were then used to file false tax returns. Also, Paige and Taylor worked in a call center for a Columbus, Georgia, company and stole identities from that company. Paige, in turn, used those identities to file false tax returns and filed some of the returns from Tracy Mitchell’s residence.
In order to file the false tax returns, Floyd applied for and obtained several Electronic Filing Numbers (EFINs) from the Internal Revenue Service (IRS) in the names of sham tax businesses. The tax refunds claimed on the false returns were paid via U.S. Treasury checks mailed to addresses under the control of participants in the scheme, prepaid debit cards issued by financial institutions, and deposits to financial institutions connected to the business EFINs so that the defendants could print refund checks.
The defendants cashed the tax refund checks at several businesses located in Alabama, Georgia and Kentucky. Sharondra Johnson worked at the Walmart money center in Columbus, Georgia, and as part of her employment, she cashed checks for customers of the money center. Demeisha Mitchell approached Sharondra Johnson about cashing tax refund checks issued in the names of other individuals. Sharondra Johnson agreed to cash these refund checks and was paid a fee for her role in the scheme.
“Taking advantage of innocent citizens, especially service members and their families, is disgraceful,” said Chief Richard Weber of IRS Criminal Investigation (CI). “IRS Criminal Investigation is committed to stopping those who would prey on others by stealing their identities. As criminals continue to become more sophisticated, we will continue to work with our law enforcement partners to bring them to justice.”
Acting Assistant Attorney General Ciraolo and U.S. Attorney Beck Jr. commended special agents of IRS - CI and the U.S. Army – CID, who investigated the case, and Trial Attorneys Michael C. Boteler and Gregory P. Bailey of the Tax Division and Assistant U.S. Attorney Todd A. Brown of the Middle District of Alabama, for prosecuting the case. Ciraolo and Beck Jr. also thanked the U.S. Attorney’s Office of the Middle District of Georgia for their assistance in the case.
Dubois Woman Submitted Fraudulent Insurance Claim After Cozy Acres Furniture Store FireRead the Press Release
JOHNSTOWN, Pa. - A resident of Clearfield County, Pennsylvania, pleaded guilty in federal court to a charge of conspiracy to commit fraud, United States Attorney David J. Hickton announced today.
Tara Finley, 40, of DuBois, Pa., pleaded guilty to one count before United States District Judge Kim Gibson.
In connection with the guilty plea, the court was advised that, on April 11, 2007, a fire destroyed the Cozy Acres furniture store, located at 2906 Oklahoma Salem Road in DuBois, Pa. Cozy Acres was owned and operated by Tara Finley and her husband, Keven Finley. In connection with the insurance claim filed with Westfield Insurance, Tara Finley misrepresented that she did not know who set the fire, when in fact she knew it was her husband. As a result of the fraudulent insurance claim, Westfield paid out more than $2 million.
Judge Gibson scheduled sentencing for Aug. 31, 2015, at 11 a.m. The law provides for a total sentence of 5 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Shaun E. Sweeney is prosecuting this case on behalf of the government.
The Bureau of Alcohol, Tobacco, Firearms and Explosives, along with the Pennsylvania State Police, conducted the investigation that led to the prosecution of Finley.
District Man Sentenced to 16 Years in Prison for First-Degree Sexual Abuse of GirlfriendRead the Press Release
WASHINGTON – Yusuf Omar Bush, 35, of Washington, D.C., was sentenced today to a 16-year prison term for sexually assaulting his girlfriend, Acting U.S. Attorney Vincent H. Cohen, Jr. announced.
Bush pled guilty in September 2014 to a charge of first-degree sexual abuse, midway through his jury trial in the Superior Court of the District of Columbia. He was sentenced by the Honorable Jennifer Anderson. Upon completion of his prison term, Bush will be placed on 30 years of supervised release. He will also be required to register as a sex offender for life.
According to the government’s evidence, Bush and the victim began a romantic relationship in late 2013. In the months that followed, Bush became increasingly jealous and domineering, falsely accusing his girlfriend of having an affair with Bush’s nephew. Bush coupled his accusations with mounting levels of physical abuse. His manipulative behavior toward the victim paralyzed her with fear.
On April 28, 2014, Bush, upset over bad news from the IRS and fueled by unfounded suspicions of infidelity, lashed out physically again at his victim while they were at his house in Southeast Washington. As the day progressed, he became increasingly volatile, trapping her in his room and choking her, striking her in the jaw and body, and ramming a gun into her mouth. He then sexually assaulted her.
Afterwards, he permitted the victim to get dressed, but then forced her to kneel before him as he urinated into her mouth. Finally, he hogtied the victim and began suffocating her. Fearing her life was over, the victim screamed, “He’s trying to kill me! He’s trying to kill me!” A witness heard the victim’s screams and came to her rescue.
The victim fled the house barefoot and immediately reported the attack to police. By contrast, the defendant sneaked out the back door and fled the area. He purchased a one-way bus ticket to California using a false name. He made it to St. Louis, where deputy U.S. Marshals arrested him on May 2, 2014. When stopped, Bush demanded to know, “Who snitched on me?”
At the time of the offense, Bush was on supervised release for a 2006 drug conviction.
In announcing the sentence, Acting U.S. Attorney Cohen commended the work of the detectives of the Metropolitan Police Department’s Sexual Assault Unit, who investigated the case, and the patrol officers who first responded to the scene. He also expressed appreciation for the work of the U.S. Marshals Service. In addition, he commended the efforts of those who worked on the case from the U.S. Attorney’s Office, including Lezlie Richardson of the Victim/Witness Assistance Unit; Paralegal Specialist Joyce Arthur; Information Technology Specialist Anisha Bhatia; and intern Cristina Stam. Finally, he commended the work of Assistant U.S. Attorneys John L. Hill and Rebekah Holman, who investigated and prosecuted the case.
Department of Justice and U.S. Attorney’s Office Mark the Fifth Anniversary of the Matthew Shepard and James Byrd Jr. Hate Crimes Prevention ActRead the Press Release
SACRAMENTO, Calif. — On Thursday, April 2, the United States Attorney’s Office, in partnership with the United States Department of Justice, the Matthew Shepard Foundation, the Napa Valley Criminal Justice Training Center, the Central California Intelligence Center, and the Sacramento State Pride Center participated in events commemorating the 5th anniversary of the passage of the landmark Matthew Shepard and James Byrd Jr. Hate Crimes Prevention Act.
In the morning, the U.S. Attorney’s Office hosted local law enforcement representatives at the Central California Intelligence Center (CCIC) in McClellan Park. The four-hour Hate Crimes Prevention Act training featured instruction on federal and state hate crimes statutes, with particular emphasis on the importance of accurate reporting of hate crimes. The program featured several special guest speakers, including Judy Shepard, mother of Matthew Shepard (after whom the statute was named), U.S. Attorney Benjamin Wagner, and representatives from the Civil Rights Division of the U.S. Department of Justice and the Federal Bureau of Investigation. The training is part of the Civil Rights Division’s nationwide effort to provide training on the Hate Crimes Prevention Act to local law enforcement entities.
Later this evening, Judy Shepard, U.S. Attorney Wagner and others will address members of the community at a commemoration of the Act’s anniversary held at California State University Sacramento. Among other things, the event will focus on the history of the Shepard Byrd Hate Crimes Prevention Act, and current federal, state and local enforcement efforts to combat hate crimes.
“The Matthew Shepard and James Byrd, Jr. Hate Crimes Prevention Act is a critical tool in our ongoing fight against invidious bias motivated violence. The Civil Rights Division is committed to working with our U.S. Attorney partners, local law enforcement, and community members to increase awareness about the Act and to continue our robust enforcement efforts. This training in Sacramento is the first of five regional trainings and community events that we will co-host around the country to mark the fifth anniversary of the Act's passage. Our hope is that these events will lead to greater collaboration between the community and law enforcement, more effective strategies to combat hate crimes, and enhanced public safety.”
“The five year anniversary of the Hate Crimes Prevention Act is an occasion to both celebrate the passage of this critical legislation and the significant enforcement actions that have already occurred, and to dedicate ourselves to the work necessary to enforce the Act even more effectively going forward,” said U.S. Attorney Wagner. “Our local law enforcement partners are dedicated to confronting this issue, and the training that my office is providing to them is part of a nationwide effort by the Department of Justice to increase our collective ability to investigate and prosecute hate crimes. We owe a great debt to the Shepard family for their unceasing efforts in support of this cause, and I am particularly grateful for their presence and participation in our efforts in Sacramento.”Mrs. Shepard, who will speak to the victim’s perspective on hate crimes, said: “On the long road to passing this law, Dennis and I always kept in mind the true purpose, which was to not only see that justice is done for hate crime victims and their loved ones, but more importantly to educate the public about the sheer size of this problem and the community about the exact ways it can protect them. Trainings like these are vital to ensure the Act delivers its full potential.”
The Matthew Shepard and James Byrd Jr. Hate Crimes Prevention Act enables the Justice Department to prosecute crimes motivated by race, color, religion and national origin without having to show that the victim was engaged in a federally protected activity. The Shepard-Byrd Act also empowers the department to prosecute crimes committed because of a person’s sexual orientation, gender identity, gender or disability as hate crimes.
In 1998, Matthew Shepard — a 21-year-old student at the University of Wyoming — was robbed, tortured, tied to a fence along a country road and left to die by two men who offered him a ride home from a local bar. The investigation into Matthew Shepard’s death found strong evidence that his attackers targeted him because he was gay.
That same year, James Byrd Jr. — a 49-year-old African-American man living in Jasper, Texas — accepted a ride home from three men. They drove him to the remote edge of town where they beat him severely, tied him by the ankles to the back of a pickup truck, and dragged him to his death. The three men responsible for his killing were well-known white supremacists.
While the men responsible for the Shepard and Byrd killings were ultimately convicted of murder, none of them was prosecuted for committing a hate crime. At the time these murders were committed, neither Wyoming nor Texas had a hate crimes law, and existing federal hate crimes protections did not include violent acts based on the victim’s sexual orientation and only covered racial violence against those engaged in a federally protected activity, such as voting or attending school.
Defendant Found Guilty in Manhattan Federal Court in Connection with 1994 Murder of 16 Year-Old GirlRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Delano A. Reid, Special Agent in Charge of the New York Division of the United States Bureau of Alcohol, Tobacco, Firearms and Explosives (“ATF”), and William J. Bratton, the Police Commissioner of the City of New York (“NYPD”), announced that JOHNNY CEDEÑO was found guilty Monday of conspiracy to commit murder-for-hire, murder-for-hire, and murder in connection with a narcotics conspiracy for his role in the murder of a 16-year-old girl. CEDEÑO was convicted after a six-day jury trial before U.S. District Judge Robert W. Sweet. CEDEÑO is the 20th defendant connected to the “Solid Gold” drug crew to be convicted for acts of violence and/or drug dealing in the Bronx in the 1990’s.
Manhattan U.S. Attorney Preet Bharara said: “Thanks to the efforts of the dedicated agents, detectives, and prosecutors who relentlessly pursued justice in this and related investigations, eight previously unsolved cold-case murders, including the tragic murder of an innocent 16-year-old girl, have now been solved and prosecuted. We hope seeing justice done is some balm to Carmen Diaz’s family, who lost her way too soon.”
ATF Special-Agent-in-Charge Delano A. Reid said: “It's nearly impossible for me to convey how gratified I am to see this long and complicated case come to a close. It was only through the dogged determination and dedication of the assigned investigators and prosecutors that we can now realize the extent of the complexities and obstacles this investigation presented. Cedeno's conviction was a long time coming but the victim's family can finally derive closure from the swift conviction and hopefully can find solace in the fact that once law enforcement has you identified and targeted, your days of freedom are surely numbered.”
NYPD Commissioner William J. Bratton said: “It is our hope that this conviction brings some comfort to the victim’s family who senselessly lost a loved one to gun violence. We thank our federal law enforcement partners who worked tirelessly to see this individual brought to justice”
According to the evidence introduced at trial, other proceedings in this case, and documents previously filed in Manhattan federal court:
JOHNNY CEDEÑO was a drug dealer who sold large quantities of crack cocaine on Bathgate Avenue in the early 90’s. He pled guilty to a firearms charge in the summer of 1994 and, while serving his sentence in connection with that charge, hired members of a drug crew that called itself “Solid Gold” to murder a rival drug dealer from Bathgate Avenue. While attempting to carry out CEDEÑO’s orders, the shooter shot and killed Carmen Diaz, a 16-year-old girl, who was sitting on the front stoop of her apartment building. Carmen Diaz sustained 11 gunshot wounds and died in the hospital three weeks later. The drug rival who was the original target of the shooting sustained injuries but did not die.
In addition to selling enormous quantities of crack cocaine, CEDEÑO and his criminal associates in Solid Gold committed numerous acts of violence, including murder, in the early 1990’s, in the areas of Bathgate Avenue and 178th/179th Streets, and 173rd Street and Boston Road, in the Bronx. Many of those crimes remained unsolved for almost 20 years. After a series of prosecutions in the Southern District of New York, culminating in this trial, 20 members and associates of Solid Gold have now been convicted for their involvement in the organization’s drug dealing activities and a total of eight murders.
JOHNNY CEDEÑO, 58, of the Bronx, faces a mandatory minimum sentence of life in prison. The maximum potential sentence is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. Judge Sweet has not yet set a sentencing date.
Mr. Bharara praised the investigative work of the ATF and the NYPD.
This case is being prosecuted by the Office’s Violent Crimes Unit. Assistant United States Attorneys Laurie A. Korenbaum and Brooke E. Cucinella are in charge of the prosecution.
Dayton Man Sentenced to Prison InRead the Press Release
ROOFING INSURANCE FRAUD SCHEME
DAYTON – Jim Honious, 45, of Dayton was sentenced here today to 12 months in prison for his role in submitting fraudulent insurance claims for roofing repairs. Honious was a salesman for the now-defunct Williams Brothers Roofing and Siding company.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, Marlon V. Miller, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), and Kathy A. Enstrom, Special Agent in Charge, Internal Revenue Service (IRS), Criminal Investigation, Cincinnati Field Office, announced the sentenced imposed today by United States District Judge Walter H. Rice.
Honious pleaded guilty in December 2013 after being charged in a one-count bill of information with conspiring with Williams Brothers’ owner, Gregory Oldiges, to defraud insurance providers using false billing practices. As an incentive to secure more customers, Williams Brothers offered to cover their customers’ insurance deductibles, but those deductibles were fraudulently passed to their insurance providers using “dummy” invoices which had been inflated over and above the deductible amounts.
Honious would have two invoices prepared for a job, with the “real invoice” being submitted to the customer for the amount actually charged for the particular roofing job and the “dummy” invoice being submitted to the insurance company at a higher amount to cover the deductibles. In some cases, the dummy invoice was inflated by more than just the customer’s deductible (inflated by $11,000 in one instance), in an effort to “cover” the customer’s repairs that were uncovered by insurance and to otherwise secure the customer’s business.
Honious was personally responsible for submitting at least 43 fraudulent “dummy” invoices between November 2010 and December 2012, with the difference between the real invoice amounts and the “dummy” invoice amounts totaling more than $75,000.Honious was ordered to serve three years on supervised release following his prison term and must pay restitution in excess of $75,000 to the defrauded insurance companies. He must also complete 100 hours of community service.
Oldiges also pled guilty for his role in the insurance fraud conspiracy (and for other crimes). He died in 2014 prior to his sentencing.
U.S. Attorney Stewart commended the investigation of this case by HSI and IRS, and Assistant United States Attorneys Vipal Patel, Alex Sistla, and Pamela Stanek, who prosecuted the case.
Dayton Couple Indicted on Marijuana, Money Laundering ChargesRead the Press Release
DAYTON – A federal grand jury has charged Dennis S. Hunter, 51, and Sivan D. Hunter, 45, both of Dayton, with conspiracy to distribute marijuana and money laundering in an indictment returned in Dayton.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, Joseph P. Reagan, Special Agent in Charge, Drug Enforcement Administration (DEA) and Kathy A. Enstrom, Special Agent in Charge, Internal Revenue Service (IRS), Criminal Investigation, Cincinnati Field Office, announced the indictment that was unsealed yesterday.
The indictment alleges that the Dennis Hunter conspired to distribute and possessed with intent to distribute more than 1,000 kilograms of marijuana in the Southern District of Ohio.
The couple allegedly laundered the illegal drug proceeds by acquiring various real estate properties, including multiple residential properties in the Dayton metropolitan area. Dennis Hunter allegedly used these properties to store and sell the marijuana. The Hunters also allegedly used the drug trafficking activities to purchase vehicles in cash, including a Volvo XC90 and Mercedes Benz R350.
Dennis Hunter allegedly used the drug proceeds for various repairs and improvements at one of his homes, including the purchase of granite countertops, windows, furniture and an 80-inch television. It is also alleged that he attempted to disguise his illegal profits by converting cash into money orders, which he then deposited into various bank accounts under his control.
Dennis Hunter remains in custody. Sivan Hunter has been released on her own recognizance.
Conspiracy to distribute marijuana is a crime punishable by up to by at least 10 years and up to a lifetime of imprisonment years in prison and money laundering carries a maximum sentence of 20 years imprisonment.
U.S. Attorney Stewart commended the investigation of this case by the DEA and IRS, and Assistant United States Attorney Brent Tabacchi, who is prosecuting the case.
An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.
Dallas County Man Sentenced to 46 Months in Federal Prison for Role in Hydrocodone and Alprazolam Distribution Conspiracy That Operated in Abilene, Lubbock and DallasRead the Press Release
LUBBOCK, Texas — A Balch Springs, Texas, man who, along with his three co-defendants, pleaded guilty to their roles in a hydrocodone and alprazolam distribution conspiracy, was sentenced today, announced John Parker, Acting U.S. Attorney for the Northern District of Texas.
John Conte Smith, a/k/a “Leo,” 35, of Balch Springs, Texas, was sentenced today by U.S. District Judge Sam R. Cummings to 46 months in federal prison. Smith, who has been in custody since his arrest, along with Dallas residents, Crystal Nicole Burks, 30; Keith Deon Noel, 36; and Lee Santrell Boston, 35; each pleaded guilty, in November 2014 to one count of conspiracy to distribute and possess with intent to distribute hydrocodone and alprazolam.
According to plea documents filed in the case, from approximately February 2014 to July 2014, in the Abilene, Lubbock, and Dallas Divisions of the Northern District of Texas, Smith, Burks, Noel, and Boston conspired together, and with others, to distribute and possess with intent to distribute hydrocodone, a Schedule III, and alprazolam, a Schedule IV, controlled substance.
Smith provided others in the conspiracy prescriptions on genuine prescription forms from medical facilities with the names of actual physicians at those facilities, but with fictitious patient names. Other co-conspirators then took the prescriptions to pharmacies to have them filled, eventually taking the controlled substances back to Smith who kept some for himself and sold the remainder.
On February 2, 2014, Burks’ boyfriend was arrested for passing forged prescriptions for her. After his arrest, Burks began passing the forged prescriptions, or using others to pass them, for Smith in the Dallas area. In May 2014, Smith directed Burks to pass forged prescriptions in the Lubbock and Abilene areas, and Burks had her brother-in-law, Noel, drive her on the trip. Before they left Dallas, Burks and Noel went to a location near downtown Dallas and recruited a homeless person, Boston, to go with them. The three left Dallas and drove to Lubbock on May 20, 2014.
The next day, Burks and Noel drove Boston to several pharmacies in Lubbock where he passed forged prescriptions that Burks had given him and paid for the prescriptions with money she had given him. Boston turned over the filled prescriptions and the change to Burks.
Burks, Noel and Boston drove to Abilene the next day, May 22, 2014, where, after passing forged prescriptions, they were arrested by officers with the Abilene Police Department.
A search warrant was executed at Smith’s home on July 2, 2014, and law enforcement located filled prescriptions for hydrocodone and alprazolam for persons other than Smith, as well as prepared prescription forms in other people’s names that had not yet been passed. Officers also found a 9mm semiautomatic pistol and ammunition in the nightstand by Smith’s bed.
Burks and Noel are scheduled to be sentenced on April 17, 2015. Boston is scheduled to be sentenced on May 15, 2015.
The FBI and the Abilene Police Department investigated. Deputy Criminal Chief Assistant U.S. Attorney Denise Williams prosecuted.
Columbia Man Added to Heroin Trafficking ConspiracyRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Columbia, Mo., man was charged in a federal indictment today for his role in a conspiracy to distribute heroin.
James Delarosa Borden, also known as “Jimmy White,” “Detroit,” and “D,” 40, of Columbia, was charged in a nine-count indictment returned by a federal grand jury in Jefferson City, Mo. Today’s second superseding indictment replaces an earlier indictment and adds Borden as a defendant. His cousin, James Delvico Borden, 38, along with Matthew Alec Ell, 20, Angelic Melanie Polston, 20, and Javis Deonn Wideman, 37, all of Columbia, were previously charged.
Today’s indictment alleges that all five defendants participated in a conspiracy to distribute 100 grams or more of heroin in Boone County, Mo., from July to October 2014.
In addition to the conspiracy, James Delarosa Borden is charged with one count of distributing heroin, Ell is charged with five counts of distributing heroin, Ell and Polston are charged together in one count of distributing heroin, and Wideman and James Delvico Borden are charged together in one count of distributing heroin.
Dickinson cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Special Assistant U.S. Attorney Stuart J. Zander. It was investigated by the Drug Enforcement Administration, the Columbia, Mo., Police Department, the Jefferson City, Mo., Police Department and MUSTANG (the Mid-Missouri Unified Strike Team and Narcotics Group).
Cleveland Doctor Sentenced for Defrauding MedicareRead the Press Release
CHATTANOOGA, Tenn. – On Apr. 2, 2015, Dr. Raymond Sean Brown, 44, of McDonald, Tenn., was sentenced serve 28 months in prison by the Honorable Curtis L. Collier. In November 2014, Brown pleaded guilty to an information charging him with the use of misbranded drugs with the intent to defraud.
Brown was also ordered to forfeit $6.765 million U.S. currency seized from his bank accounts in December 2012 and pay an additional $717,000. Upon his release from prison, he will serve one year of supervised release.
The plea agreement on file with the U.S. District Court states that from May 2008 until December 2012, Brown fraudulently billed Medicare for Botox injections he did not give. During that time period, he received $7,482,968 in reimbursement from Medicare for Botox injections. According to the plea agreement, between 2008 and 2012, Brown did not purchase any FDA approved Botox and only 254 vials of non-FDA approved Botox, but billed Medicare for 17,766 vials. By pleading guilty, Brown admitted that he received the Botox in interstate commerce for delivery for pay which was misbranded and that he acted with intent to defraud or mislead.
“For medical care, patients rely on the honesty and integrity of their doctor. This defendant not only did not inject the drugs needed by the patients, but also fraudulently billed the Medicare system, which is funded by the taxpayers. This sentence and the additional financial penalties will deter other medical providers from actions such as were exhibited in this case,” said U.S. Attorney Bill Killian.
This investigation was conducted by agents with the U.S. Food and Drug Administration- Office of Criminal Investigation and U.S. Department of Health and Human Services- Office of Inspector General. Assistant U.S. Attorney Terra L. Bay represented the United States.
###
Cambria County Man Sentenced on Narcotics and Firearms ViolationsRead the Press Release
Prosecution Is Part Of Project Safe Neighborhoods Initiative
JOHNSTOWN, Pa. – A local resident has been sentenced in federal court to 36 months in prison and three years’ supervised release on his conviction of violating federal narcotics and firearms laws, United States Attorney David J. Hickton announced today.
United States District Judge Kim R. Gibson imposed the sentence on Eugene Albert Harris, Jr., 38, of Johnstown, Pa.
According to information presented to the court, on May 31, 2013, Harris distributed less than 100 grams of heroin, and he was found in possession of a NOR, Model SKS, 7.62 x 39 caliber rifle, and a Jennings Bryco Arms, Model 59, 9 mm caliber pistol. On Apr. 25, 2003, Harris was convicted in Indiana Co., Pa., of drug trafficking, which is a crime punishable by imprisonment for a term exceeding one year. Federal law prohibits persons who have been convicted of a crime punishable by a term of imprisonment exceeding one year from possessing firearms.
Assistant United States Attorney Stephanie L. Haines prosecuted this case on behalf of the government.
Mr. Hickton commended the Laurel Highlands Resident Agency of the Federal Bureau of Investigation and the Cambria County Drug Task Force for the investigation leading to the successful prosecution of Harris.
According to Mr. Hickton, this case was prosecuted as part of Project Safe Neighborhoods initiative, a collaborative effort by federal, state and local law enforcement agencies, prosecutors and communities to prevent, deter and prosecute gun crime.