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7 May 2015
Muskogee Man Sentenced to 35 Months for Cocaine DistributionRead the Press Release
MUSKOGEE, OKLAHOMA - The United States Attorney’s Office for the Eastern District of Oklahoma, announced today that RALPH TYRONE CARUTHERS, age 49, of Muskogee, Oklahoma, was sentenced to 35 months imprisonment, followed by 2 years of supervised release for Possession with Intent to Distribute Cocaine, in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(C).
Charges arose from an investigation by the Muskogee Police Department and the Oklahoma Bureau of Narcotics. The defendant was indicted in August, 2014 and pled guilty in January, 2015.
The Information alleged that on or about July 8, 2014, within the Eastern District of Oklahoma, the defendant, RALPH TYRONE CARUTHERS, did knowingly and intentionally possess with intent to distribute a mixture or substance containing a detectable amount of cocaine, a Schedule II Controlled Substance.
The Honorable James H. Payne, District Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, presided over the hearing. The defendant will remain in the custody of the United States Marshal Service pending transportation to the designated federal prison at which he will serve his nonparolable sentence.
Assistant United States Attorney Shannon Henson represented the United States.
Monroeville Resident Arrested on Federal Jury Tampering ChargeRead the Press Release
United States Attorney Kenyen R. Brown of the Southern District of Alabama announces that Jonathan Lawrence Oneal, 42, of Monroeville, Alabama was arrested today by federal authorities for jury tampering. According to a criminal complaint filed in U.S. District Court for the Southern District of Alabama, Oneal was arrested for corruptly seeking to influence a prospective juror in connection with a federal criminal trial of John Hastie in Mobile, Alabama. According to the complaint’s affidavit, Oneal is a Cooper Marine & Timberlands employee who works under John Hastie, the spouse of defendant Kimberly Hastie and a co-defendant in a trial in which the couple is charged with conspiring to commit tax fraud. The affidavit alleges that Oneal, acting at John Hastie’s direction, reached out to the wife of a prospective juror before and during jury selection and conveyed messages to her for the purpose of influencing her husband’s views regarding the Hastie case. Jury tampering is a violation of 18 U.S.C. § 1503 and carries a term of up to 10 years in prison.
United States Attorney Kenyen R. Brown states: “The public has a vital interest in preserving the integrity of the judicial process. Jury tampering is a serious threat to the proper functioning of our justice system. The United States will work closely with our law enforcement partners to aggressively pursue all jury tampering allegations and ensure that those involved are held accountable.”
The Federal Bureau of Investigation is leading the investigation. The case is being prosecuted by Assistant United States Attorney Sean P. Costello.
A criminal complaint is a written statement of the essential facts of the offense charged. A defendant is presumed innocent until and unless he or she is proven guilty at trial.
If any member of the public has information regarding any acts of jury tampering, please contact the Federal Bureau of Investigation, Mobile Division, at 251-438-3674.
Middlesex County, New Jersey, Member of Drug Trafficking Organization Sentenced to Five Years in Prison for Conspiring to Sell HeroinRead the Press Release
TRENTON, N.J. – A Perth Amboy, New Jersey, man was sentenced today to 60 months in prison for conspiring to distribute hundreds of grams of heroin throughout Monmouth and Ocean counties, U.S. Attorney Paul J. Fishman announced.
Rashawn Ramos, 38, previously pleaded guilty before U.S. District Judge Peter G. Sheridan to an information charging him with one count of conspiring to distribute 100 grams or more of heroin and 500 grams or more of cocaine. Judge Sheridan imposed the sentence today in Trenton federal court.
In March 2014, 21 alleged members of the “Britt-Young DTO,” a drug trafficking organization named after its leaders Robert Britt and Rufus Young, were charged by criminal complaint with conspiring to distribute heroin. Of those 21 individuals, 12 have pleaded guilty.
According to documents filed in this case and statements made in court:
Ramos admitted that from November 2013 through March 2014, he received numerous packages of heroin and cocaine at his residence in Perth Amboy. The packages were sent from California via the U.S. Mail. Ramos later transferred the packages to another conspirator, who distributed the narcotics to others in New Jersey, including members of the Britt-Young DTO. Altogether, Ramos received at least 1,000 grams of heroin and 1,500 grams of cocaine.
In addition to the prison term, Judge Sheridan sentenced Ramos to serve four years of supervised release.
U.S. Attorney Fishman credited special agents of the FBI, Red Bank Resident Office, under the direction of Special Agent in Charge Richard M. Frankel, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Nicholas Grippo of the U.S. Attorney’s Office Criminal Division in Newark.
Defense Counsel: Ramos: Anthony Simonetti Esq., Hightstown, New Jersey
Medicare Beneficiary Pleads Guilty in Ambulance Fraud SchemeRead the Press Release
PHILADELPHIA – Keisha Regusters, 38, of Philadelphia, PA, pleaded guilty today to a fraud scheme involving kickbacks from an ambulance company. U.S. District Court Judge William H. Yohn, Jr. scheduled a sentencing hearing for August 11, 2015. Regusters faces a possible advisory sentencing guideline range of six to 12 months in prison, up to three years of supervised release, restitution, a fine of up to $500,000, and a $200 special assessment.
In July 2010, Feda Kuran, charged elsewhere, began operating Brotherly Love Ambulance, Inc. with a co-schemer. In approximately October 2010, Keisha Regusters began being transported to dialysis by Brotherly Love, even though she could walk and could have been transported safely by means other than ambulance and was, therefore, not eligible for ambulance service under Medicare requirements. Kuran billed Medicare for those ambulance services as if they were medically necessary when she knew that they were not. Regusters accepted monthly kickback payments to induce her to continue to ride with Brotherly Love, and she solicited payments to induce her to continue to ride with Brotherly Love.
As a result of the defendant’s actions and those of Brotherly Love, the Medicare program paid more than $52,000 in inappropriate bills. As a result of the overall scheme at Brotherly Love, the Medicare program was billed for more than $4.9 million and paid more than $2 million in inappropriate bills. In November 2014, Feda Kuran was sentenced to 64 months in prison.
The case was investigated by the U.S. Department of Health and Human Services Office of the Inspector General, the Federal Bureau of Investigation, and the U.S. Department of Labor Office of the Inspector General. It is being prosecuted by Assistant United States Attorneys Mary E. Crawley and Paul W. Kaufman.
McGuffy man charged with failing to register as sex offenderRead the Press Release
An indictment was filed charging Terry Joe Higdon, 47, of McGuffy, Ohio, with failing to register under the Sex Offender Registration and Notification Act, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio.
If convicted, the defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, and the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The investigating agency in this case is the U.S. Marshal Service. The case is being handled by Assistant United States Attorney Tracey Ballard Tangeman.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Massachusetts Defense Subcontractor to Resolve False Claims Concerning “Made-In-America” Contract RequirementsRead the Press Release
BOSTON – A Massachusetts company, Trendware Marketing, LLC, a supplier of components for military boots, has entered into an agreement with the United States to resolve allegations that it violated the False Claims Act when it did not comply with the Department of Defense’s (DOD) made-in-America requirements.
Trendware will pay $600,000 to resolve the government’s claim that it violated the Berry Amendment in connection with DOD contracts for military combat boots. The Berry Amendment requires that certain items purchased by the DOD, including military boots and boot hardware, be wholly of United States origin. The government alleges that, although Trendware certified that it was in compliance with the Berry Amendment, the footwear components provided by the company for military boots were not manufactured within the United States. Trendware’s certifications of compliance were false and misleading. This resolution seeks to strip Trendware of its unfair price advantage in competing for military contracts by using non-American-made products and undercutting its competitors.
“Trendware falsely claimed that all of its products were made in America, and thereby ensured that it won government contracts worth hundreds of thousands of dollars,” said United States Attorney Carmen M. Ortiz. “These false claims not only deprived the United States military of the products it required, but deprived other honest businesspeople of a fair shot at this government contract.”
“Second only to our servicemen and women in the defense of this great nation is the vital importance of our technology and equipment,” said Frank Robey, Director of the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit. “Whether it’s a main battle tank or the boots that go on the feet of our troops, we have to be absolutely certain that we are getting what we pay for—there can be no doubt or room for error when lives are literally at risk on the battlefield. We owe nothing less than that to our servicemembers, and our CID special agents are fully committed to ensuring that the government and the Army get what they pay for.”
“Ensuring our servicemen and women are outfitted with the proper equipment procured through a fair and honest acquisition process is essential,” said Craig W. Rupert, Special Agent in Charge of the Northeast Field Office, Defense Criminal Investigative Service, Department of Defense, Office of the Inspector General. “DCIS continues working with our law enforcement partners to shield America’s investment in national defense from the manipulation of the procurement process by unscrupulous contractors.”
This matter was handled by Assistant U.S. Attorney Sonya A. Rao of Ortiz’s Civil Division.
Mason County Man Sentenced to 87 Months for CocaineRead the Press Release
A Maysville, Ky., man, who led a conspiracy that distributed cocaine in Mason County, has been sentenced to 87 months in federal prison.
U.S. District Judge David L. Bunning sentenced 37 year-old Gerald Gibbs for conspiracy to distribute cocaine. Under federal law, Gibbs must serve at least 85 percent of his prison sentence, and following his release, he will be under the supervision of the U.S. Probation Office for 3 years.
During the sentencing hearing, the government established that, over the course of several years, Gibbs conspired with others to obtain cocaine that was ultimately distributed in Maysville in both powder and crack forms. The Court ultimately determined that Gibbs was responsible for distributing between two and three kilograms of cocaine.
William Slater and Randy Kirk, co-defendants of Gibbs, previously received prison sentences of 150 months and 63 months, respectively, for their roles in the conspiracy.
Kerry B. Harvey, United States Attorney for the Eastern District of Kentucky; Ron Rice, Chief of Police, Maysville Police Department; Joseph Reagan, Special Agent in Charge, Drug Enforcement Administration, Detroit Field Division; and Christopher A. Henry, Special Agent in Charge, Internal Revenue Service, jointly announced the sentence.
The investigation was conducted by the Maysville Police Department, DEA, and IRS. Assistant U.S. Attorney Elaine K. Leonhard prosecuted this case on behalf of the federal government.
Maryland Man Charged with Defrauding Women Through On-Line Dating SitesRead the Press Release
PITTSBURGH - A Maryland resident has been indicted in Pittsburgh by a federal grand jury on charges of wire fraud, money laundering and aggravated identity theft, United States Attorney David J. Hickton announced today.
The 17-count indictment, returned on May 5, named Sigismond Senyo Segbefia, 28, of Silver Spring, Md., as the sole defendant.
According to the indictment, Segbefia engaged in an online “Romance Scheme,” in which he defrauded victims out of money by posing as other persons on popular online dating websites ChristianMingle.com and Match.com. He also is accused of wiring illicit funds to Ghana.
The law provides for a total sentence of 322 years in prison, a fine of $4,500,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the criminal history, if any, of the defendant.
Assistant United States Attorney Gregory C. Melucci is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Manchester Man Sentenced on Bank Robbery ChargeRead the Press Release
CONCORD, N.H. – Roger Hicks, 51, of Manchester, appeared in United States District Court for the District of New Hampshire and was sentenced to 37 months in prison for robbing the Members First Credit Union in Manchester on October 3, 2014, announced Acting United States Attorney Donald Feith.
The defendant, who was identified by bank personnel and through surveillance video, entered the Members First Credit Union on Bridge Street and made several attempts to withdraw funds using cash-advance debit/credit cards. After being informed there were insufficient funds to satisfy the withdrawal, Hicks passed a demand note to the teller which stated he had a gun. The defendant was subsequently arrested in Manchester and indicted by a Federal Grand in January of this year.
This case was investigated by the Manchester Police Department and was prosecuted by Assistant United States Attorney Helen White Fitzgibbon with the assistance of the Federal Bureau of Investigation.
Manager in Counterfeit Credit Card Ring Pleads GuiltyRead the Press Release
Baltimore, Maryland –Navee Diaz, a/k/a India, age 40, of Owings Mills, Maryland pleaded guilty today to bank fraud conspiracy and aggravated identity theft, arising from a scheme to use of stolen credit and debit card information to manufacture counterfeit credit cards used to buy merchandise and services.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Brian Murphy of the United States Secret Service - Baltimore Field Office; Chief Gary Gardner of the Howard County Police Department; Commissioner Anthony W. Batts of the Baltimore Police Department; Chief James W. Johnson of the Baltimore County Police Department; Chief Ross C. Buzzuro of the Ocean City Police Department; Acting Special Agent in Charge Ivan Arvelo of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Newport News Police Chief Richard W. Myers; and Colonel William M. Pallozzi, Superintendent of the Maryland State Police.
According to her plea agreement, starting before January 1, 2011 and continuing through June 2014, Diaz conspired with co-defendants William Downey, Michael Crew and others to manufacture counterfeit debit and credit cards bearing stolen and unauthorized credit and debit card account numbers, then use the counterfeit cards to purchase goods and services. Diaz initially became involved in the scheme when her friend, Downey, introduced her to Crew, with whom she became romantically involved. Crew had an embossing machine, and made credit cards using altered gift cards and the credit card and debit card numbers stolen from others. The stolen credit card account numbers were obtained from a variety of sources. Once a valid number was obtained, Diaz and other co-conspirators would use an algorithm to derive other valid numbers, which they would confirm by calling customer service for the issuing financial institution. These numbers were used to manufacture counterfeit access devices bearing the stolen credit and debit card account numbers.
Crew sold the counterfeit credit cards and recruited others, including Diaz, to go out and make purchases on Crew’s instructions. Ultimately, Diaz began to provide cards to others and to take and fulfill orders for items purchased with the counterfeit cards. Diaz recruited others into the scheme, obtained cards as needed from Crew and co-defendant Jason Evans, and even manufactured cards herself. She exchanged dozens of text messages each day taking orders, arranging for cards and workers, and conducting other business of the conspiracy. Diaz went out shopping with the cards on a daily basis, with and without other workers in the scheme.
During her participation in the conspiracy, Diaz and her co-conspirators obtained or attempted to obtain extensions of credit from financial institutions of between $200,000 and $400,000, using the financial account numbers of real people. More than 250 individuals and institutions were defrauded by the scheme.
Diaz and the government have agreed that if the Court accepts the plea agreement Diaz will be sentenced to 76 months in prison. U.S. District Judge William D. Quarles, Jr. has scheduled sentencing for July 14, 2015 at 10:00 a.m. At the time of her sentencing, Diaz will also be required to pay restitution in the full amount of the victims’ actual losses, currently computed to be $126,318.99.
Michael Crew, age 55, of Owings Mills, previously pleaded guilty to the same charges and was sentenced to nine years in prison and ordered to pay restitution of $126,318.99. William Downey, age 43, of Gwynn Oak, Maryland, his brother, Stanley Downey, age 49, formerly of New York, and Jason Evans, age 32, of Millsboro, Delaware, also pleaded guilty to their roles in the conspiracy and are scheduled to be sentenced on July 30, 2015, June 23, 2015, and May 20, 2015, respectively, all at 1:00 p.m. Diaz and the Downey brothers remain detained pending sentencing.
The Maryland Identity Theft Working Group has been working since 2006 to foster cooperation among local, state, federal, and institutional fraud investigators and to promote effective prosecution of identity theft schemes by both state and federal prosecutors. This case, as well as other cases brought by members of the Working Group, demonstrates the commitment of law enforcement agencies to work with financial institutions and businesses to address identity fraud, identify those who compromise personal identity information, and protect citizens from identity theft.
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. Secret Service; Howard County, Baltimore City, Baltimore County, Howard County, Ocean City and Newport News Police Departments, HSI Baltimore and Maryland State Police for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Tamera L. Fine, who prosecuted the case.
Man Pleads Guilty to Possession of Prison ContrabandRead the Press Release
St. Croix, USVI – Shevron Percival, 25, pleaded guilty today in District Court on St. Croix to one count of Possession of Prison Contraband, United States Attorney Ronald W. Sharpe announced.
As part of his plea, Percival admitted that on October 26, 2012, while he was an inmate at the Golden Grove Adult Correctional Facility, Virgin Islands Bureau of Corrections (BOC) officers discovered a cellular telephone tied up in the waist string of the basketball shorts he was wearing. Cellular telephones are prohibited contraband in correctional facilities because they are known to be used by prisoners to intimidate witnesses, orchestrate narcotics transactions, and to facilitate other criminal activity, including murders.
Possession of prison contraband carries a maximum sentence of one year in prison and a $100,000 fine. Sentencing is scheduled for September 9, 2015.
The case was investigated by BOC and the United States Drug Enforcement Administration. It is being prosecuted by Assistant U.S. Attorney Rami S. Badawy.
Lodi Woman Sentenced to 7½ Years in Prison for Distributing MethamphetamineRead the Press Release
SACRAMENTO, Calif. — Peggy Babb, 55, of Lodi, was sentenced today by United States District Judge Troy L. Nunley to seven years and eight months in prison for distribution of methamphetamine and violating the terms of her supervised release, United States Attorney Benjamin B. Wagner announced.
According to court documents, on November 6, 2014, Babb sold approximately 118 grams of crystal methamphetamine to an individual working with law enforcement. She was arrested soon thereafter. At the time of her arrest, Babb was serving a term of supervised release following a nearly 10-year prison term for a federal drug trafficking felony she committed in 2003.
Judge Nunley sentenced Babb to 65 months in prison for methamphetamine distribution and 27 months in prison for violating the terms of her supervised release, which prohibited Babb from engaging in illegal conduct while under Court supervision. Babb has been in custody since her arrest.
This case was the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and the Lodi Police Department. Assistant United States Attorney Christiaan Highsmith prosecuted the case.
Lafayette man pleads guilty to possessing 8 stolen firearms in homeRead the Press Release
LAFAYETTE, La. – United States Attorney Stephanie A. Finley announced today that a Lafayette man pleaded guilty to possessing eight stolen firearms.
Rico D. King, 39, of Lafayette, pleaded guilty before U.S. District Judge Richard T. Haik to one count of possession of stolen firearms. According to evidence presented at the guilty plea, during an investigation into Lafayette burglaries and after developing leads as to the location of the stolen firearms, agents executed a search warrant in September of 2014 at a residence in Lafayette where King was an occupant. During the search, agents found King in possession of the stolen firearms including a .26-06 caliber rifle, two .25-06 caliber rifles, a .410 gauge shotgun, two .12 gauge shotguns, a .22 caliber semi-automatic rifle and a .270 caliber rifle. Victims of the burglaries reported all eight firearms as stolen.
King faces up to 10 years in prison, three years of supervised release and a $250,000 fine. A sentencing date was not set.
Multiple agencies including the ATF, FBI, Lafayette Parish Sheriff’s Office and Lafayette Metro Narcotics Task Force conducted the investigation. Assistant U.S. Attorneys Robert C. Abendroth and Kelly P. Uebinger are prosecuting the case as part of Project Safe Neighborhoods. Project Safe Neighborhoods is a nationwide program designed to reduce violence by aggressively enforcing existing federal firearms laws.
Killeen Business Owner Pleads Guilty to Selling Synthetic MarijuanaRead the Press Release
The owner of the Cove Smoke Shack in Killeen, TX, faces up to 20 years in federal prison after admitting to selling synthetic marijuana announced Acting United States Attorney Richard L. Durbin, Jr., Special Agent in Charge Joseph M. Arabit of the Drug Enforcement Administration’s Houston Division, and Killeen Police Chief Dennis Baldwin.
Appearing before United States District Judge Walter S. Smith, Jr. this afternoon in Waco, 42-year-old Richard Young Bruce pleaded guilty to one count of possession with intent to distribute a controlled substance. Subsequent to multiple undercover purchases of synthetic marijuana, authorities executed a federal search warrant at the business location on November 3, 2014. During the search warrant, authorities seized over 150 packets of pre-packaged synthetic cannabinoids along with approximately $20,000 cash representing the proceeds of the illegal distribution of controlled substances.
Bruce, who remains on bond, is scheduled for sentencing on July 1, 2015.
This case resulted from an investigation by the Drug Enforcement Administration and the Killeen Police Department. This case is being prosecuted by Assistant United States Attorney Chris Blanton.
Justice Department Reaches Settlement with Evergreen Bank Group to Resolve Allegations of Discriminatory Motorcycle LendingRead the Press Release
Settlement Compensates Affected Borrowers and Allows Bank to Continue Motorcycle Lending Using Revised Dealer Compensation Policies
Evergreen Bank Group of Oak Brook, Illinois, will eliminate or limit the discretion it gives to motorcycle dealers to increase interest rates as part of a settlement of a federal lawsuit alleging a pattern or practice of national origin and race discrimination in motorcycle lending, the Justice Department announced today. In addition to the elimination of dealer discretion, which is consistent with a policy that Evergreen voluntarily adopted in March 2014, the settlement will provide $395,000 in compensation for victims of Evergreen’s past discrimination.
The settlement, which remains subject to court approval, was filed today with the department’s complaint in the U.S. District Court of the Northern District of Illinois. The complaint alleges that Evergreen violated the Equal Credit Opportunity Act (ECOA), by charging approximately 2,200 Hispanic and African-American borrowers higher interest rates than non-Hispanic white borrowers between January 2011 and March 2014. The complaint alleges that Evergreen’s FreedomRoad Financial motorcycle lending unit charged borrowers higher interest rates because of their national origin or race, and not because of the borrowers’ creditworthiness or other objective criteria related to borrower risk. This discriminatory charge would result in the average victim paying about $200 to $250 extra during the term of the loan.
“The department, in cooperation with our partner agencies, continues to closely examine the motor vehicle lending market for potential discrimination,” said Principal Deputy Assistant Attorney General Vanita Gupta of the Civil Rights Division. “We thank Evergreen for recognizing the risk of discrimination caused by discretionary dealer markups, and adopting new dealer compensation policies that substantially reduce that risk.”
Rather than taking applications directly from consumers, Evergreen makes most of its motorcycle loans through roughly 400 motorcycle dealers nationwide who help their customers pay for their new or used motorcycle by submitting their loan applications to Evergreen.
Until March 2014, Evergreen’s business practice, like many other motor vehicle lenders, allowed motorcycle dealers subjective and unguided discretion to vary a loan’s interest rate from the price Evergreen initially set. The initial price set by Evergreen reflected the borrower’s objective credit-related factors. Dealers received greater payments from Evergreen on loans that included a higher interest rate markup. The department’s December 2013 lawsuit against Ally Financial Inc. and Ally Bank, which resulted in a settlement providing $80 million in borrower compensation, involved a similar compensation system.
In March 2014, Evergreen eliminated motorcycle dealers’ discretion to increase interest rates. Instead, Evergreen adopted a policy of always compensating dealers based on a percentage of the loan principal amount that does not vary based on the loan’s interest rate. No discrimination was observed when the United States analyzed loans made under the new policy. The settlement allows Evergreen to continue using the revised compensation policy it adopted in March 2014.
The lawsuit originated from a March 2013 referral by the Federal Deposit Insurance Corporation (FDIC) to the Justice Department’s Civil Rights Division. Evergreen is regulated by the FDIC.
The Justice Department’s enforcement of fair lending laws is conducted by the Fair Lending Unit of the Housing and Civil Enforcement Section in the Civil Right Division. Since the Fair Lending Unit was established in February 2010, it has filed or resolved 38 lending matters under the Fair Housing Act, the Equal Credit Opportunity Act, and the Servicemembers Civil Relief Act. The settlements in these matters provide over $1.2 billion in monetary relief for impacted communities and individual borrowers. The Attorney General’s annual reports to Congress on ECOA highlight the department’s accomplishments in fair lending and are available at www.justice.gov/crt/publications.
The Civil Rights Division, the U.S. Attorney’s Office for the Northern District of Illinois, and the FDIC are members of the Financial Fraud Enforcement Task Force. President Obama established this task force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information on the task force, visit www.StopFraud.gov.
The settlement provides for an independent administrator to locate victims and distribute payments of compensation at no cost to borrowers whom the department identifies as victims of Evergreen’s discrimination. The department will make a public announcement and post information on its website once more details about the compensation process become available. Borrowers who are eligible for compensation from the settlement will be contacted by the administrator, and do not need to contact the department at this time. Individuals who believe that they may have been victims of lending discrimination by Evergreen and have questions about the settlement may contact the department at 202-514-4713.
A copy of the complaint and proposed settlement order, as well as additional information about fair lending enforcement by the United States Department of Justice, can be obtained from the United States Department of Justice website at www.justice.gov/fairhousing.
Justice Department Files Civil Complaint Against Healthcare Commons Inc. for Failure to Re-employ Returning Service MemberRead the Press Release
Alleges Violation of Employment Rights of Sergeant in Army National Guard
The Department of Justice announced today it has filed a civil complaint against a South Jersey company for failing to re-employ a former employee when she returned from a National Guard deployment, a violation of federal law.
The civil lawsuit, filed in Camden federal court, alleges that Healthcare Commons Inc., of Carneys Point, New Jersey, willfully violated the Uniformed Services Employment and Re-employment Rights Act of 1994 (USERRA). USERRA protects the rights of uniformed service members to retain their civilian employment following absences due to military service obligations and provides that they shall not be discriminated against because of their military obligations.
Megan Toliver, 32, of New Castle, Delaware, is a former employee of Healthcare Commons. She joined the U.S. Army National Guard in September 2004 and, most recently, had served as a sergeant, with honorable service as a mental health specialist. According to the complaint, when Toliver returned from her military deployment in May 2014, Healthcare Commons willfully violated USERRA by not re-employing her as a mental health screener or in another comparable position.
“No person should lose their job for serving our country, but according to our complaint that’s exactly what happened to a National Guard member here,” said Acting Associate General Stuart F. Delery. “Today’s filing is one more example of the Department of Justice’s commitment to protecting the men and women who serve in our Armed Forces from discrimination and unlawful actions.”
“The filing of this case reinforces the commitment of the Department of Justice to the vigorously enforce the prohibition of employment discrimination based on military service,” said Principal Deputy Assistant Attorney General Vanita Gupta of the Civil Rights Division. “I want to thank the Department of Labor for referring this case to the Department of Justice. I’m hopeful that through the department’s newly created Servicemembers and Veterans Initiative, we will continue to build on our strong ties with federal partners and continue using every tool at our disposal to protect the rights of the men and women who serve in our Armed Forces.”
“The men and women who serve in our armed forces here and abroad do so at great personal sacrifice,” said U.S. Attorney Paul Fishman of the District of New Jersey. “Because of that sacrifice, federal law guarantees that they have the opportunity to resume their careers when they’ve completed their service. When companies seek to skirt their obligations to re-employ our returning veterans, we will hold them accountable.”
The case was referred by U.S. Department of Labor following an investigation by the department’s Veterans’ Employment and Training Service.
The plaintiff is represented by Special Litigation Counsel Andrew Braniff of the Civil Rights Division and Assistant U.S. Attorney Michael E. Campion of the District of New Jersey.
In March 2015, the Attorney General created the Servicemembers and Veterans Initiative, which is led by three dedicated career Justice Department attorneys with strong ties to the military community. They will further the department’s existing efforts by coordinating and expanding enforcement, outreach, and training efforts on behalf of service members, veterans and their families. The initiative will address the unique challenges that service members face while on active duty, that veterans face upon returning home, and that families face when a loved one is deployed.
Additional information about USERRA can be found on the Justice Department’s websites at www.usdoj.gov/crt/emp and www.servicemembers.gov, the U.S. Attorney’s Office website at www.justice.gov/usao-nj and the Labor Department’s website at www.dol.gov/vets/programs/userra/main.htm.
Jamaican Lottery Fraud Defendant Sanjay Williams Found Guilty of Conspiracy to Commit Fraud and Other ChargesRead the Press Release
BISMARCK – Sanjay Ashani Williams, of Montego Bay, Jamaica, was found guilty on charges of Conspiracy to Commit Wire Fraud or Mail Fraud, Conspiracy to Commit International Money Laundering, and thirty-five counts of Wire Fraud, after a six-and-a-half-day jury trial in federal court, announced Acting U.S. Attorney Christopher C. Myers.
Williams sold "lead lists" to Jamaican Lottery Fraud scammers, providing the scammers with the names, telephone numbers, and personal information of potential victims. Williams’ co-conspirators then contacted victims by telephone or mail and falsely told the victims they had won a large sweepstakes prize, such as $3.5 million and a new Mercedes-Benz automobile. Callers repeatedly instructed victims that in order to claim the prize, the victims had to send money, sometimes thousands of dollars, to the scammers to pay non-existent taxes, fees, insurance, and the like. Williams and other scammers deliberately targeted victims over the age of 55. After the "fees" were paid, the victims were required to send more and more money; however, the victims did not receive the promised prize.
The scammers frequently impersonated trusted institutions such as the Federal Bureau of Investigation, Bank of America, the Internal Revenue Service, and state government agencies. They sometimes mailed official-looking, but fake, documents on letterhead to victims. Scammers also used official-looking email addresses, telephone numbers, and sent bogus checks to victims in order to make the scam more convincing.
Williams is the first person prosecuted and convicted, in either the United States or Jamaica, for selling lead lists to be used in the Jamaican Lottery Fraud. In this case alone, over seventy victims were identified, with reported losses totaling over $5,000,000. Individual victims lost as little as $300 and as much as $800,000 to the scam. Williams was one of the first Jamaican national defendants implicated in the Jamaican Lottery Fraud to have been tried and convicted in the United States. Prior to Williams’ trial, 11 indicted defendants from Jamaica and the United States were arrested and pleaded guilty in this case, and 14 indicted defendants are awaiting arrest and extradition from Jamaica. Three additional co-conspirators were charged in a separate Indictment.
Acting United States Attorney Christopher Myers said, "This case should send the message to fraudsters around the world, ‘If you victimize North Dakota citizens, we can and will find you and bring you to justice.’ It is our hope that this groundbreaking prosecution will open doors for other jurisdictions to prosecute these cases and that the lessons we’ve learned can be used across the country."
Corporal Kevin Watson of the Major Organised Crime and Anti-Corruption Agency (MOCA), Lottery Scam Task Force, in Jamaica, testified at the trial as an expert witness. An official from MOCA in Jamaica emphasized the willingness of Jamaican law enforcement officials to continue to work in partnership with their United States counterparts to fight the ongoing scourge of the lottery fraud, and to assist in the efforts to bring the remaining indicted Jamaican defendants to trial in North Dakota.
Williams faces up to 40 years in prison and millions of dollars in fines, restitution, and criminal forfeiture. The Honorable Daniel L. Hovland has set a sentencing hearing for Williams on August 6, 2015, in United States District Court, Bismarck, ND.
The case was investigated by the North Dakota office of the Federal Bureau of Investigation (FBI) and the United States Postal Inspection Service (USPIS) in Florida, with assistance from many other federal and state law enforcement agencies, as well as Jamaican law enforcement agencies.
Assistant U.S. Attorney Clare Hochhalter, Assistant U. S. Attorney Nick Chase, Assistant U.S. Attorney James Patrick Thomas, and Department of Justice Trial Attorney Lorinda Laryea prosecuted the case.
Jamaican Lottery Fraud Defendant Found Guilty of Conspiracy to Commit Fraud and Other ChargesRead the Press Release
Sanjay Ashani Williams, of Montego Bay, Jamaica, was found guilty on charges of one count of conspiracy to commit wire fraud or mail fraud, one count of conspiracy to commit international money laundering and 45 counts of wire fraud (counts two through 44), after a six-and-a-half-day-jury trial in federal court, announced Acting U.S. Attorney Christopher C. Myers for the District of North Dakota.
Williams sold “lead lists” to Jamaican lottery fraud scammers, providing the scammers with the names, telephone numbers and personal information of potential victims. Williams’ co-conspirators then contacted victims by telephone or mail and falsely told the victims they had won a large sweepstakes prize, such as $3.5 million and a new Mercedes Benz automobile. Callers repeatedly instructed victims that in order to claim the prize, the victims had to send money, sometimes thousands of dollars, to the scammers to pay non-existent taxes, fees, insurance and the like. Williams and other scammers deliberately targeted victims over the age of 55. After the “fees” were paid, the victims were required to send more and more money, however, the prize was fake and the victims did not receive the promised prize.
The scammers frequently impersonated trusted institutions such as the Federal Bureau of Investigation (FBI), Bank of America, the Internal Revenue Service (IRS) and state government agencies. They sometimes mailed official-looking, but fake, documents on letterhead to victims. Scammers also used official-looking email addresses, telephone numbers and sent bogus checks to victims in order to make the scam more convincing.
Williams is the first person prosecuted and convicted, in either the United States or Jamaica, for selling lead lists to be used in the Jamaican lottery fraud. In this case alone, over 70 victims were identified, with reported losses totaling over $5 million. Individual victims lost as much as $800,000 to the scam. Williams was one of the first Jamaican national defendants implicated in the Jamaican lottery fraud to have been tried and convicted in the United States. Prior to Williams’ trial, 11 indicted defendants from Jamaica and the United States were arrested and pleaded guilty in this case and 14 indicted defendants are awaiting arrest and extradition from Jamaica. Three additional co-conspirators were charged in a separate indictment.
“This case should send the message to fraudsters around the world, if you victimize North Dakota citizens, we can and will find you and bring you to justice,” said Acting U.S. Attorney Myers said. “It is our hope that this groundbreaking prosecution will open doors for other jurisdictions to prosecute these cases and that the lessons we’ve learned can be used across the country.”
Williams faces up to 40 years in prison and millions of dollars in fines, restitution and criminal forfeiture. The honorable Daniel L. Hovland has set a sentencing hearing and forfeiture hearings for Williams on Aug. 6, 2015, in U.S. District Court in Bismarck, North Dakota.
The case was investigated by the North Dakota office of the FBI and the U.S. Postal Inspection Service (USPIS) in Florida, with assistance from many other federal and state law enforcement agencies. Corporal Kevin Watson of the Major Organised Crime and Anti-Corruption Agency (MOCA), Lottery Scam Task Force in Jamaica, testified as an expert witness.
Assistant U.S. Attorneys Clare Hochhalter, Nick Chase and Patrick Thomas and Trial Attorney Lorinda Laryea for the Department of Justice prosecuted the case.
International Money Launderer Pleads Guilty to His Role in Defrauding Law Firms and Other ScamsRead the Press Release
Tampa, Florida – United States Attorney A. Lee Bentley, III announces that Muhammad Naji (34, Tampa) has pleaded guilty to conspiracy to commit money laundering. He faces a maximum penalty of 20 years in federal prison. A sentencing date has not yet been set.
According to the plea agreement, beginning in January 2014, Naji conspired with others to launder money that had been obtained as the result of fraud. In one of the fraudulent schemes, the conspirators sent “phishing” emails to law firms around the country soliciting legal representation in a fictitious contract dispute. After convincing a firm to tentatively agree to the representation, the conspirators would email fictitious documentation demonstrating their claim. They would also request that the law firm issue a demand letter for the full amount owed on the contract. The conspirators would then mail a forged certified bank check to the law firm as payment to resolve the dispute. The “client” would contact the firm and instruct them to wire the funds, minus the retainer fee, to a specific bank account. If the conspirators were successful in their scam, the law firm would authorize the wiring of the funds before the check cleared.
During the execution of the wire fraud schemes, Naji opened multiple bank accounts, or had others open them for him. Once the fraud proceeds were successfully wired into his accounts, Naji would quickly wire the funds to other bank accounts controlled by conspirators, many of which were outside of the United States, including China, Hong Kong, and Canada. From January 2014, through and including the present, Naji opened more than 35 fraudulent accounts with an estimated loss exposure of more than $2.5 million.
This case was investigated by the FBI. It is being prosecuted by Assistant United States Attorney Matthew Jackson.
Indiana couple charged with transporting and coercing minor to engage in illicit conductRead the Press Release
An Indiana couple was indicted for transporting a minor over state lines to engage in illicit sexual conduct, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio.
Nicholas Lawler, 25, and Brittany Lawler, 23, both of Anderson, Indiana, were indicted on one count of transportation of a minor and one count of coercion and enticement of a minor to engage in unlawful sexual activity between January 1, 2015 and April 3, 2015.
If convicted, the defendants sentences will be determined by the Court after reviewing factors unique to this case, including each defendant’s prior criminal record, if any, and each defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case was investigated by the Ohio Bureau of Criminal Identification and Investigation, the Tiffin Police Department and the Anderson (Indiana) Police Department. The case is being prosecuted by Assistant U.S. Attorney Tracey Ballard Tangeman.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
IT Software Services Contractor and its President Agree to Pay $9 million to Settle Civil False Claims Act AllegationsRead the Press Release
ALEXANDRIA, Va. – Global Computer Enterprises, Inc. (GCE), of Reston, Virginia, along with its president and sole owner, Raed Muslimani, 53, of Sterling, Virginia, have agreed to pay $9 million to settle civil claims stemming from allegations that GCE concealed its utilization of prohibited engineers and employees on software services contracts with the federal government.
GCE, a cloud-based “software as a service” provider, provided the U.S. Department of Labor (DOL) and the Equal Employment Opportunity Commission (EEOC) with financial management software services pursuant to competitively awarded federal contracts. During the competitions for those contracts and after award, GCE allegedly misrepresented and/or concealed that it was utilizing engineers and other employees who were expressly prohibited from working on the contracts due to their citizenship/immigration statuses.
GCE was additionally awarded software development services contracts with the General Services Administration (GSA), the United States Secret Service, and the United States Coast Guard (USCG). In those contracts as well, it is alleged that GCE repeatedly misrepresented and/or concealed its use of engineers and employees expressly prohibited from working on those contracts due to their security clearance statuses, labor qualifications, or overseas locations.
To resolve the allegations under the civil False Claims Act and other related statutory and common law remedies, GCE and Muslimani agreed to pay the United States $9 million, to be paid out of GCE’s Chapter 11 proceeding. The Bankruptcy Court approved the settlement on April 22, 2015. GCE filed its Chapter 11 bankruptcy petition on September 4, 2014, and the United States filed a proof of claim on February 27, 2015.
The civil claims settled by GCE, Muslimani, and the United States are allegations only; there has been no determination of civil liability.
The settlement obtained in this matter was the result of a coordinated effort by the U.S. Attorney’s Office for the Eastern District of Virginia and the Financial Litigation Section and Fraud Section of the Commercial Litigation Branch of the Civil Division of the Department of Justice. The matter was investigated by Assistant U.S. Attorney Peter S. Hyun and Special Assistant U.S. Attorney Josh Cavinato. John T. McConkie of the Financial Litigation Section of the Commercial Branch of the Civil Division of the Department of Justice is handling the bankruptcy matter on behalf of the United States.
The case was investigated by the GSA Office of Inspector General (OIG), the FBI’s Washington Field Office, the DOL-OIG, the EEOC-OIG, with assistance from the USCG Investigative Service and the United States Secret Service.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the Bankruptcy Court for the Eastern District of Virginia or on PACER by searching for Case No. 14-13290-RGM.
Hyattsville Man Pleads Guilty to Charges Related to Two Carjacking AbductionsRead the Press Release
ALEXANDRIA, Va. –Darian Robinson, 42, of Hyattsville, Maryland, pleaded guilty today to charges of using, carrying, and brandishing a firearm during and in relation to a crime of violence and being a felon in possession of a firearm.
According to the statement of facts filed with the plea agreement, on Nov. 7, 2014, Robinson approached a woman outside of a Walgreens in Fairfax County, Virginia. He then brandished a firearm, ordered her into her car, and forced her to drive to various ATMs to withdraw cash from her bank account. He then forced the victim to drive to a drive-thru liquor store in Maryland to purchase alcohol for him before having her drop him off at the New Carrollton Metro station. Then, on Nov. 12, 2014, Robinson followed a second woman as she exited the Vienna Metro Station. After she was inside her car, Robinson tapped on the window with a gun. He then forced her to drive to Washington, D.C. and then Maryland. Once there, Robinson forced her to drive to various ATMs in attempts to withdraw money which were unsuccessful. Thereafter, Robinson forced this victim to drive to drive-thru liquor stores before dropping him off at the New Carrollton Metro station. During both incidents, Robinson threatened to shoot his victims.
Robinson was indicted by a federal grand jury on March 11, 2015. Robinson faces a maximum penalty of life in prison when he is sentenced on Aug. 21, 2015. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Ronald A. Pavlik, Jr., Chief of Metro Transit Police, Colonel Edwin C. Roessler, Jr., Fairfax County Chief of Police, and Andrew G. McCabe, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after the plea was accepted by U.S. District Judge Liam O’Grady.
This case was investigated by Metro Transit Police Department, Fairfax County Police Department, and the FBI’s Washington Field Office with assistance from the United States Secret Service and the Baltimore County Police Department. Assistant U.S. Attorneys Patricia Giles and Tyler McGaughey are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:15-cr-78.
Husband and Wife Sentenced for Manufacturing Child PornographyRead the Press Release
NEW BERN – United States Attorney Thomas G. Walker announced that in federal court today, BAILEY JOE MILLS, 34and his wife, ELIZABETH MILLS, 35, both of Lillington, North Carolina, were sentenced before United States District Judge Louise W. Flanagan. BAILEY JOE MILLS received 45 years imprisonment followed by a lifetime term of supervised release. ELIZABETH MILLS received 16 years imprisonment followed by 10 year supervised release. Both are required to register as sex offenders.
On June 12, 2014, a Criminal Information was filed charging BAILEY JOE MILLS with manufacturing child pornography, in violation of Title 18, United States Code, Sections 2251(a) and (d). ELIZABETH MILLS was charged by Criminal Complaint on October 20, 2014, with aiding and abetting the manufacturing of child pornography. Both pled guilty to their charges on August 12, 2014, and November 12, 2014, respectively.
According to the investigation, in January, 2014, an investigation was initiated relating to the sexual abuse of a 12-year-old. Law enforcement learned that BAILEY JOE MILLS had also sexually abused at least 10 other minors and that he had paid several of the minors to have sex with himself and other men.
As the investigation continued, a search warrant was executed on the MILLS’ residence in Harnett County, where multiple computers, cellular phones and media storage devices were seized. Forensic examination of the cellular phones and computers revealed a multiple of still images and videos depicting the minors engaged in prohibited sexual conduct produced by BAILEY JOE MILLS with the assistance of his wife, ELIZABETH MILLS.
Investigation of this case was conducted by the Harnett County Sheriff’s Office and the Department of Homeland Security/Homeland Security Investigations. Assistant United States Attorney Ethan Ontjes prosecuted the case for the United States.
This case was part of the Project Safe Childhood initiative, a national program aimed at ensuring that criminals exploiting children are effectively prosecuted by making full use of all available law enforcement resources at every level. For more information about this important national project, Project Safe Childhood, go to www.projectsafechildhood.gov.
Houston Man Sent to Prison for Producing Child PornographyRead the Press Release
HOUSTON – Luis M. Gonzalez, 53, has been ordered to federal prison for nearly 27 years following his conviction of production of child pornography, announced United States Attorney Kenneth Magidson. Gonzalez pleaded guilty Jan. 12, 2015.
Late yesterday, U.S. District Judge Lee H. Rosenthal ordered he serve a total of 320 months in federal prison. Following his prison term, he will be on supervised release for the rest of his life and must register as a sex offender. In handing down the sentence, Judge Rosenthal considered evidence that Gonzalez had sexually assaulted two minor girls.
The investigation began in January 2014 when FBI agents downloaded videos containing child pornography from a computer later identified and located at the residence of Gonzalez in Houston.
On Feb. 28, 2014, a federal search warrant was executed, at which time Gonzalez admitted to using a peer-to-peer file sharing program to download child pornography and told the agents they would find images and videos of child pornography on his computer equipment. Gonzalez also admitted he produced pictures of child pornography involving an underage girl.
A forensic exam was conducted which resulted in the discovery of images of child pornography on two hard drives. Agents found approximately 69 videos of child pornography, some of which depicted the penetration of a minor under the age of five and bondage. Agents also discovered approximately 66 images of child pornography that Gonzalez had produced. The camera used to produce these images was also found during the search.
The charges against Gonzalez were the result of an investigation conducted by the Houston office of the FBI. Gonzalez was arrested on the federal charges in February 2014. He has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
The case is being prosecuted by Assistant U.S. Attorneys Sherri Zack and Robert Stabe.
Honduran National Sentenced for Illegal Use of a Social Security NumberRead the Press Release
U.S. Attorney Kenneth A. Polite announced that RONY RIVERA-GONZALES, age 23, a citizen of Honduras and residing in Hammond, was sentenced after previously pleading guilty to a one-count Indictment for illegal use of a Social Security Number.
U.S. District Judge Marry Lemmon sentenced GONZALES to time served followed by one year of supervised release, and a $100 special assessment. GONZALES will be surrendered to the custody of the U.S. Immigration and Customs Enforcement for removal proceedings.
According to court documents, on or about August 20, 2014, GONZALES submitted a social security number which did not belong to him to a Louisiana Department of Motor Vehicles Office in order to obtain a Louisiana Identification Card. Based on that false submission, an employee with the Department of Motor Vehicles issued GONZALES a Louisiana Identification Card.
U.S. Attorney Polite praised the work of the Homeland Security Investigations and the Louisiana State Police in investigating this matter. Assistant United States Attorney Spiro G. Latsis was in charge of the prosecution.
Hedge Fund CFO Sentenced to Prison for Fraud SchemeRead the Press Release
RICHARD PEREIRA, 43, the former chief financial officer of New Stream Capital, LLC, a Ridgefield-based hedge fund, was sentenced today by Chief U.S. District Judge Janet C. Hall in New Haven to 12 months and one day of imprisonment, followed by three years of supervised release, for engaging in a scheme to deceive investors in order to obtain and maintain investments.
According to court documents and statements made in court, in November 2007, New Stream Capital, LLC (“New Stream”) launched new feeder funds, one based in the United States (“U.S. Fund”) and a series of funds based in the Cayman Islands (“Cayman Fund”). New Stream also announced that its existing Bermuda Fund would be closing, and all foreign investors would have to move their investments into the Cayman Fund. Rather than transfer into the new structure, New Stream’s largest investor placed a redemption on its whole investment in the Bermuda Fund in March 2008. At risk of losing their largest investor, PEREIRA and New Stream managing partners David Bryson and Bart Gutekunst set in motion a scheme to secretly keep the Bermuda Fund open and give priority to Bermuda Fund investors in an effort to reverse the redemption.
As part of the scheme, PEREIRA, Bryson and Gutekunst had New Stream staff secretly execute documents to effectuate the Bermuda Fund’s special priority. New Stream failed to inform investors who had transferred from the Bermuda Fund into the Cayman Fund that the Bermuda Fund was remaining open or that it was being given priority over the Cayman Fund. Moreover, New Stream continued to market to investors by concealing from them the magnitude of the actual pending redemptions and by using deceptive marketing materials that failed to disclose the existence of New Stream’s Bermuda Fund.
Through this scheme, New Stream investors were defrauded out of more than $46 million.
From April 2008 to December 2010, Bryson and Gutekunst each collected more than $5 million in management fees and profit sharing while participating in this fraud scheme. In late 2008, PEREIRA received a $700,000 bonus from New Stream.
On May 21, 2014, PEREIRA, Bryson and Gutekunst each pleaded guilty to one count of conspiracy to commit wire fraud.
On May 5, 2015, Bryson was sentenced to 33 months of imprisonment and, on May 6, 2015, Gutekunst was sentenced to 30 months of imprisonment.
This matter was investigated by the Federal Bureau of Investigation and the U.S. Department of Labor, Office of Inspector General, with the assistance of the Securities and Exchange Commission. The case was prosecuted by Assistant U.S. Attorneys Liam Brennan and Michael S. McGarry, and Special Assistant U.S. Attorney Sheldon L. Pollock.
Harrison County man convicted of unlawful possession of thirteen firearmsRead the Press Release
CLARKSBURG, WEST VIRGINIA – Wade Highland, 45, of Lost Creek, West Virginia, was convicted in federal court today of unlawful possession of multiple firearms, United States Attorney William J. Ihlenfeld, II, announced.
Highland was previously convicted in February 2009 of “Grand Larceny” in the Circuit Court of Harrison County, West Virginia. As a result of the conviction, he is prohibited from possessing firearms. In August 2014, Highland was discovered in unlawful possession of thirteen firearms.
Highland pled guilty today to one count of “Felon in Possession of a Firearm.” He faces up to 10 years in prison and a fine of up to $250,000.00. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Zelda Wesley prosecuted the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated.
U.S. Magistrate Judge John S. Kaull presided.
Hamden Man Sentenced to 5 Years in Federal Prison for Selling CrackRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that JEROME MOYE, 32, of Hamden, was sentenced yesterday by U.S. District Judge Vanessa L. Bryant in Hartford to 60 months imprisonment, followed by three years of supervised release, for distributing crack cocaine.
According to court documents and statements made in court, on six occasions between February and April 2014, MOYE sold crack cocaine to an individual working with law enforcement.
MOYE has been detained since his arrest on August 27, 2014. On February 24, 2015, he pleaded guilty to one count of possession with intent to distribute, and distribution of, cocaine base (“crack”).
MOYE’s criminal history includes multiple felony convictions, including a sexual assault conviction, and numerous violations of probation. He previously served a state prison term of more than three years for a narcotics distribution offense.
This matter was investigated by the Federal Bureau of Investigation and the New Haven Police Department. The case was prosecuted by Assistant U.S. Attorney Peter D. Markle.
Four Defendants Charged in Brooklyn and Sixteen Charged in Italy for Their Participation in A Transnational Cocaine Trafficking OperationRead the Press Release
Queens Defendants Also Charged with Possessing Illegal Firearms
A six-count superseding indictment was unsealed yesterday in Brooklyn federal court charging husband and wife defendants Gregorio and Eleonora Gigliotti, their son Angelo Gigliotti, and a relative who is an Italian citizen, Franco Fazio, with conspiracy to import cocaine, conspiracy to possess with intent to distribute cocaine, importation of cocaine, and attempted possession of cocaine. In addition, the Gigliotti defendants were charged with unlawful use and possession of firearms. The charges arise from the defendants’ participation in an international narcotics-trafficking operation between July 1, 2014 and March 11, 2015.
The charges were announced by Kelly T. Currie, Acting United States Attorney for the Eastern District of New York; Raymond R. Parmer, Special Agent-in-Charge, U.S. Immigration and Customs Enforcement, Homeland Security Investigations (HSI), New York; and Diego Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI).
The unsealing of the superseding indictment coincides with the arrest of thirteen defendants in Italy today on related drug-trafficking charges resulting from the collaboration between the United States and Italian law enforcement agencies. Among those arrested by the Italian authorities was Franco Fazio, who will face charges in Italy before the United States seeks his extradition to face the charges contained in the Brooklyn superseding indictment. The Gigliotti defendants, who remain in custody in the United States, were also charged with narcotics-trafficking offenses by the Italian authorities.
“This case is a powerful example of the impact of international cooperation in combatting criminal organizations whose activities transcend national borders,” stated Acting United States Attorney Currie. Mr. Currie extended his grateful appreciation to Homeland Security Investigations and the Federal Bureau of Investigation, and thanked our law enforcement partners in Italy, including the Prosecutor of the Republic of Reggio Calabria; the Italian National Police (INP), and in particular, the Squadra Mobile of Reggio Calabria and the Servizio Centrale Operativo; the Direzione Centrale per i Servizi Antidroga; and the Direzione Nazionale Antimafia. Mr. Currie also expressed his gratitude to the U.S. Department of Justice Attaché and the Offices of the HSI and FBI Legal Attaché at the U.S. Embassy in Rome, who coordinated extensive evidence-sharing and coordinated operations.
“The arrests in New York and Italy dismantle a global network of alleged drug smugglers believed responsible for importing more than 50 kilograms of cocaine into the U.S.,” said HSI New York Special Agent-in-Charge Parmer. “This investigation is another example of the collective efforts of our federal and international law enforcement partners to bring down those responsible for the proliferation of illegal drugs in our communities, no matter where in the world they hide.”
“Using their family’s businesses in New York as a front for a narcotics trafficking operation, the defendants, as alleged, sought to establish a global cocaine ring. We also used a global team to take on this case, working closely with our partners in Italy,” said FBI Assistant Director-in-Charge Rodriguez. “As today’s arrests show, we are committed to working together to disrupt and dismantle organized criminal enterprises.”
The charges detailed in the Brooklyn indictment are the product of a lengthy investigation by HSI and the FBI that involved the use of court-authorized wiretaps and physical surveillance, and revealed that between October and December 2014 alone, the defendants imported over 55 kilograms of cocaine into the United States from Costa Rica, which was recovered by law enforcement.
As alleged, Gregorio and Eleonora Gigliotti owned and operated several businesses in New York City that were used to facilitate their narcotics-trafficking operation, including Cucino Amodo Mio, an Italian restaurant and pizzeria in Corona, Queens, and Fresh Farms Export Corp., an import/export company. In October 2014, law enforcement intercepted a shipment of cassava (a starchy root) that was shipped to the United States from Costa Rica and bound for Farm Fresh Export Corp. in New York. The shipment was found to contain approximately 40 kilograms of cocaine secreted inside cardboard boxes of cassava. Earlier, Eleonora Gigliotti allegedly traveled to Costa Rica with approximately $400,000 in cash that she delivered to the sources of supply. In September 2014, Franco Fazio allegedly traveled from Italy to New York and then to Costa Rica to deliver another $170,000 in cash to the sources of supply.
In December 2014, law enforcement intercepted a second shipment of cassava bound for Fresh Farms Export Corp. in New York that had also been shipped from Costa Rica and seized approximately 15 kilograms of cocaine secreted within the cardboard boxes of produce. Prior to the arrival of this shipment of cocaine, defendant Franco Fazio allegedly made two additional trips to Costa Rica to meet with the sources of supply.
The Gigliotti defendants were arrested on March 11, 2015, in New York. That same day, law enforcement searched Cucino Amodo Mio and Gregorio and Eleonora Gigliotti’s residence. In the restaurant they seized one 12 gauge shotgun; one loaded .357 magnum Trooper revolver; one loaded .22 caliber Colt pistol; one loaded .38 caliber Charter Arms revolver; one 9 mm Keltec pistol; one .762 Czech pistol; one .38 caliber Derringer that had a defaced serial number; ammunition magazines; loose ammunition; two handgun holsters; brass knuckles; and more than $100,000 in cash. In the Gigliotti residence agents recovered a loaded .45 caliber Llama handgun and more than $18,000 in cash.
The charges in Italy relate to the defendants’ narcotics trafficking distribution ring in that country – as a quantity of the cocaine imported into the United States was destined for exportation to and distribution in Italy. Based in part upon the U.S. investigation, Italian law enforcement disabled a narcotics distribution ring allegedly operating in Calabria on behalf of the U.S.-based defendants.
The charges in the superseding indictment are merely allegations, and the defendants are presumed innocent unless and until proven guilty. If convicted, they face a potential mandatory minimum sentence of 15 years’ imprisonment. The Brooklyn defendants will be arraigned at a later date before United States District Judge Raymond J. Dearie.
The government’s case is being prosecuted jointly by the Office’s Organized Crime & Gangs Section and the Long Island Criminal Section. Assistant United States Attorneys James Miskiewicz, Nicole M. Argentieri and Margaret E. Gandy are in charge of the prosecution.
The Defendants:
GREGORIO GIGLIOTTI
Age: 59
Malba, New York
ELEONORA GIGLIOTTI
Age: 54
Malba, New York
ANGELO GIGLIOTTI
Age: 34
Woodside, New York
FRANCO FAZIO
Age: 56
Calabria, Italy
E.D.N.Y. Docket No. 15-CR-204 (RJD)
Former Chief Finance Officer Sentenced to 51 Months in Prison for Stealing Approximately $4 Million from His EmployerRead the Press Release
CHARLOTTE, N.C. – On Wednesday, May 6, 2015, U.S. District Judge Robert J. Conrad, Jr. sentenced Nathan Thomas Mroz, 40, of Charlotte, to 51 months in prison and to two years of supervised release in connection with his scheme to steal money from his former employer, Andersen Heating & Cooling (Andersen), announced Jill Westmoreland Rose, Acting U.S. Attorney for the Western District of North Carolina. In April 2014, Mroz, the former Chief Finance Officer (CFO) for Andersen, a Mint Hill-based HVAC company, pleaded guilty to mail fraud in connection with his scheme. Judge Conrad also ordered Mroz to pay approximately $4,000,000 in restitution.
Acting U.S. Attorney Rose is joined in making today’s announcement by John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division.
According to filed court documents and court proceedings, from 2005 to 2013, Mroz was employed by Andersen as financial controller and later as CFO and had access to the company’s funds and books and records. Court records show that over the course of his employment, Mroz exploited his position to create fake accounts payable invoices and to generate corresponding payments, which Mroz directed to himself or mailed to various credit cards he maintained. According to court documents, to cover up his scheme, Mroz fraudulently categorized the bogus company payments as legitimate business expenses in the company’s books and records. Court records reflect that Mroz spent the stolen money on personal expenditures, including vacations to Disneyland and Europe, luxury vehicles, private school tuition, jewelry, and a $115,000 home for his nanny, among others. In all, court documents indicate that Morz stole approximately $4 million from Andersen.
In handing down the sentence, Judge Conrad noted that Mroz “abused his position of trust with respect to his controller and CFO functions” and that the execution of the scheme required “hundreds of acts of fraud and deceit” by Mroz. Judge Conrad stressed the “devastating harm to the company” as a result of Mroz’s greed and the “calamitous effect of Mroz’s scheme on innocent groups of people.”
Judge Conrad also ordered defendant to forfeit a Charlotte residence that he had used stolen money to purchase for use by his nanny, as well as diamond jewelry valued at approximately $40,000. The forfeiture was in addition to a payment in excess of $116,000 that defendant already made as restitution pursuant to his plea agreement.
Following the sentencing hearing Mroz was released on bond. He will be ordered to report to the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
Acting U.S. Attorney Rose credited the FBI for the investigation leading to today’s sentence. She also thanked the Mint Hill Police Department for their invaluable assistance throughout the investigation.
Assistant U.S. Attorney Mark T. Odulio of the U.S. Attorney’s Office in Charlotte prosecuted the case.
Former Bastrop Federal Prison Pharmacy Technician and Two Inmates Plead Guilty to Bribery ChargeRead the Press Release
In Austin, a former Bastrop federal prison pharmacy technician and two inmates pleaded guilty to their roles in a bribery scheme to smuggle contraband into the facility announced Acting United States Attorney Richard L. Durbin, Jr.
Appearing before United States Magistrate Judge Andrew Austin, 25-year-old Eric Renaldo Telles of Taylor, TX, pleaded guilty to one count of receipt of a bribe by a public official; FCI-Bastrop inmates 27-year-old Shanon E. Frank and 24–year-old Mattheu Ellis Jones each pleaded guilty to one count of conspiracy to bribe a public official. According to court records, Frank and Jones admitted to bribing Telles to smuggle contraband into FCI-Bastrop from June 2014 to February 2015. The smuggled contraband included Casio G-Shock watches, creatine, nutritional supplements and muscle shirts. Telles collected as much as $2,000 in bribes as a result of the scheme.
Frank and Jones, who remain in federal custody, face up to five years in federal prison. Telles, who faces up to 15 years in federal prison, remains on bond pending sentencing. Sentencing, before United States District Judge Sam Sparks in Austin, has yet to be scheduled.
The case resulted from an investigation by the Department of Justice Office of Inspector General. This case is being prosecuted by Assistant United States Attorney Matthew Devlin.
Former Assistant Band Director Charged in Identity Theft Tax Fraud Scheme Involving Former Broward County Students and Other Individuals’ Personal Identifying InformationRead the Press Release
A former assistant band director was charged for his participation in an identity theft tax fraud scheme involving former Broward County students and other individuals’ personal identifying information (PII).
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), and Paula Reid, Special Agent in Charge, United States Secret Service (USSS), Miami Field Office, made the announcement.
Delvis Demaine Rogers, 27, of Hollywood, Florida, was charged by indictment with one count of using one or more unauthorized access devices, in violation of Title 18, United States Code, Section 1029(a)(2), one count of possession of fifteen or more unauthorized access devices, in violation of Title 18, United States Code, Section 1029(a)(3), and four counts of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A(a)(1). The defendant faces a maximum statutory sentence of ten years in prison for each of the unauthorized access charges, and a mandatory term of two years in prison, consecutive to any other term of imprisonment, for the aggravated identity theft charge(s).
According to the criminal complaint filed on March 11, 2015, IRS-CI investigators noticed that 419 suspicious tax returns claiming refunds totaling $754,470 were filed from Rogers’ residential address from January 25, 2014 to April 20, 2014. Based on this information, a search warrant was executed at Rogers’ residence and agents discovered and seized papers, notes, and documents containing thousands of PII (including names, dates of birth, and social security numbers) including PII contained in records of more than a dozen Broward County School District students, some dating back to the late 1990s and others into the late 2000s. Agents also seized numerous printed 2013 tax returns.
Agents interviewed Rogers during the execution of the search warrant and he admitted to having prepared and filed hundreds of fraudulent tax returns without the permission of the people in whose names they were filed. Rogers further admitted that he electronically submitted the filings from his apartment. Rogers advised that he was employed as the band director at a school in Opa Locka, Florida, and that he previously was the assistant band director at a high school in Plantation, Florida.
Rogers pled not guilty at his arraignment today before United States Magistrate Judge Patrick M. Hunt.
Mr. Ferrer commended the investigative efforts of IRS-CI and the USSS. This case is being prosecuted by Assistant U.S. Attorneys Brooke C. Watson and Daya Nathan.
An indictment is only an accusation and a defendant is presumed innocent until proven guilty beyond a reasonable doubt.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Florida Man Found Guilty on Charges of Conspiring to Commit Mail and Wire Fraud, Obstruct Official ProceedingsRead the Press Release
Claimed over $1.6 million in fraudulent refunds
RICHMOND, Va. – Eddie Blanchard, 37, of Miami, Florida, was convicted yesterday by a federal jury on charges of Conspiracy to Commit Mail and Wire Fraud, Mail Fraud, Wire Fraud, Aggravated Identity Theft, Conspiracy to Obstruct Official Proceedings, and Obstruction of Official Proceedings.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Thomas J. Kelly, Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation; David M. McGinnis, Acting Inspector in Charge of the Washington Division of the United States Postal Inspection Service; and Douglas A. Middleton, Chief of Henrico Police Division made the announcement after the verdict was accepted by U.S. District Judge Henry E. Hudson.
Blanchard faces a maximum penalty of 20 years in prison on each of the two conspiracy counts, fourteen fraud counts and one obstruction count, and a mandatory consecutive 2 years on the aggravated identity theft count when sentenced on August 7, 2015. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Blanchard was indicted on October 7, 2014. According to evidence presented at trial, Blanchard participated in a Miami-based stolen identity refund fraud scheme. He and three confederates, Ramoth Jean, Junior Jean Merilia, and Jimmy Lord Calixte traveled repeatedly to Richmond in the early part of 2012 and used stolen personal identifying information to file hundreds of fraudulent tax returns, utilizing online tax preparation programs. Blanchard and his accomplices claimed significant refunds on those fraudulent returns, and requested that those refunds be placed on pre-paid debit cards, which were later mailed to Richmond addresses selected by the conspirators.
The scheme began to unravel when a Henrico County police officer encountered Jean removing a box containing stolen personal identifying information from a storage unit rented by the co-conspirators. Following Jean’s subsequent arrest on June 20, 2013, Blanchard convinced him to mislead federal investigators about the identity of his actual co-conspirators, going so far as to facilitate the creation of a fictional accomplice. Jean ultimately refused to testify before a federal grand jury about this matter.
On January 9, 2014, Jean was sentenced to 114 months’ imprisonment for his role in the fraud scheme. His sentencing on a separate contempt charge for his refusal to testify before the grand jury is scheduled for May 21, 2015. Merilia pled guilty to conspiracy to commit mail and wire fraud, aggravated identity theft, and obstruction of official proceedings. His sentencing is scheduled for June 19, 2015. Calixte is currently a fugitive.
This case was investigated by the Internal Revenue Service’s Criminal Investigation Division and the United States Postal Inspection Service, with assistance from the Henrico County Police Department as members of the Metro-Richmond Identity Theft Task Force. Other member agencies of the Task Force include: the United States Secret Service, the Bureau of Diplomatic Security, the U.S. Department of State, Richmond Police Department, and Chesterfield County Police Department. Prosecutions for the Task Force are handled by the United States Attorney’s Office and the Office of the Attorney General for the Commonwealth of Virginia. Assistant U.S. Attorneys Michael C. Moore and Thomas A. Garnett are prosecuting the case on behalf of the United States.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case Nos. 3:13cr136, 3:14cr73, 3:14cr139, and 3:15cr39.
First-Time Drug Trafficker Sentenced to over Five Years in PrisonRead the Press Release
TULSA, Okla.—Alejandro Cabrera Charre, 23, was sentenced on Wednesday to 63 months in prison for conspiring to distribute methamphetamine, announced Danny C. Williams Sr., United States Attorney for the Northern District of Oklahoma. United States District Court Chief Judge Gregory K. Frizzell also sentenced Alejandro Charre to three years of supervised release following his prison sentence.
Testimony at trial revealed that Alejandro Charre and his uncle, Juan Charre, traveled from Texas to Tulsa to deliver methamphetamine. On October 18, 2014, Tulsa Police Department officers discovered approximately four pounds of methamphetamine concealed in the Charres’ vehicle. The drugs had an estimated value of $46,000. On November 4, 2014, the Charres were indicted by a Grand Jury for drug trafficking offenses. Juan Charre pleaded guilty; however, Alejandro Charre pleaded not-guilty and was tried on January 26, 2015. On January 28, 2015, a jury found him guilty.
This case was investigated by the Tulsa Police Department’s Special Investigations Division and the Drug Enforcement Administration. Assistant United States Attorneys Neal C. Hong and Timothy L. Faerber prosecuted the case.
Federal Indictment: Army Private Stole Fellow Soldiers’ IdentitiesRead the Press Release
TOPEKA, KAN. – A former private in the U.S. Army stationed at Fort Riley has been indicted on charges of stealing his fellow soldiers’ identities, U.S. Attorney Barry Grissom said today.
Todd M. Newbrough was charged Wednesday with four counts of wire fraud, four counts of bank fraud, four counts of aggravated identity theft and one count of computer fraud. The crimes are alleged to have occurred at various times from 2011 to 2015 at Fort Riley, Kan.
The indictment alleges Newbrough used personal identifying information of fellow soldiers to obtain lines of credit and credit cards in their names. He got the information through his access to Leave and Earning Statements, Enlisted Record Brief and Alpha Roster records.
If convicted, he faces a maximum penalty of 30 years in federal prison and a fine up to $1 million on each wire fraud and each bank fraud count, a mandatory consecutive two years on the aggravated identity theft counts, and a maximum penalty of five years and a fine up to $250,000 on the computer fraud count. The Army Criminal Investigation Division investigated. Assistant U.S. Attorney Christine Kenney and Special Assistant U.S. Attorney Robin Graham are prosecuting.
“This is the culmination of a great deal of investigative work conducted by Special Agents from CCIU and our other law enforcement partners who were so critical to this investigation,” said Daniel Andrews, Director of the Computer Crime Investigative Unit (CCIU) for the U.S. Army
Criminal Investigation Command.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
Federal Court Issues Written Judgment Accepting Guilty Plea of Schlumberger Oilfield Holdings Ltd. for Violating U.S. Sanctions by Facilitating Trade with Iran and SudanRead the Press Release
Company Must Pay $232.7 Million Penalty
The U.S. District Court of the District of Columbia entered a formal judgment yesterday memorializing the sentence requiring Schlumberger Oilfield Holdings Ltd. (SOHL), a wholly-owned subsidiary of Schlumberger Ltd, to pay a $232,708,356 penalty to the United States for conspiring to violate the International Emergency Economic Powers Act (IEEPA) by willfully facilitating illegal transactions and engaging in trade with Iran and Sudan.
The judgment was announced by Assistant Attorney General for National Security John P. Carlin, Acting U.S. Attorney Vincent H. Cohen Jr. of the District of Columbia and Under Secretary Eric L. Hirschhorn of the U.S. Commerce Department’s Bureau of Industry and Security (BIS).
At a hearing on April 30, 2015, the District Judge John D. Bates of the District of Columbia accepted the company’s guilty plea and sentenced the company to the proposed sentence articulated in the plea agreement, which called for the fine and other terms of corporate probation. The court recognized the seriousness of SOHL’s criminal conduct, which posed a threat to our national security. In addition, the court noted that the scope of criminal conduct justified the large monetary penalty imposed. Finally, the court concluded that the terms of probation provided adequate deterrence to SOHL as well as other companies. Yesterday, the court entered the written judgment confirming the sentence imposed on April 30, 2015.
“The court’s judgment represents a milestone in the enforcement of U.S. sanctions laws,” said Assistant Attorney General Carlin. “This case marks the first conviction of a corporate entity for facilitating violations of the International Economic Emergency Powers Act and the highest criminal fine ever imposed in a sanctions prosecution. The Court’s imposition of this serious sentence should serve as a strong deterrent for multinational corporations doing any business in countries subject to U.S. economic sanctions.”
“This guilty plea and sentence hold this company accountable for violating trade laws by doing business with sanctioned countries and undermining the interests of the United States,” said Acting U.S. Attorney Cohen. “We hope that other companies tempted to break our export laws take note of the $232.7 million penalty that will be paid in this case.”
The criminal information and plea agreement were filed on March 25, 2015, in federal court in the District of Columbia, charging SOHL with one count of knowingly and willfully conspiring to violate IEEPA. The plea agreement that the court approved also requires SOHL to submit to a three-year period of corporate probation and agree to continue to cooperate with the government and not commit any additional felony violations of U.S. federal law. SOHL’s monetary penalty includes a $77,569,452 criminal forfeiture and an additional $155,138,904 criminal fine. The criminal fine represents the largest criminal fine in connection with an IEEPA prosecution. In addition to SOHL’s commitments, under the plea agreement SOHL’s parent company, Schlumberger Ltd., has also agreed to the following terms during the three-year term of probation, among others: maintaining its cessation of all operations in Iran and Sudan, reporting on the parent company’s compliance with sanctions, responding to requests to disclose information and materials related to the parent company’s compliance with U.S. sanctions laws when requested by U.S. authorities, and hiring an independent consultant to review the parent company’s internal sanctions policies and procedures and the parent company’s internal audits focused on sanctions compliance.
The court agreed that in addition to SOHL continuing its cooperation with U.S. authorities throughout the three-year period of probation and agreeing not to engage in any felony violation of U.S. federal law, SOHL’s parent company, Schlumberger Ltd., will also hire an independent consultant who will review the parent company’s internal sanctions policies, procedures and company-generated sanctions audit reports.
According to court documents, starting on or about early 2004 and continuing through June 2010, Drilling & Measurements (D&M), a United States-based Schlumberger business segment, provided oilfield services to Schlumberger customers in Iran and Sudan through non-U.S. subsidiaries of SOHL. Although SOHL, as a subsidiary of Schlumberger Ltd., had policies and procedures designed to ensure that D&M did not violate U.S. sanctions, SOHL failed to train its employees adequately to ensure that all U.S. persons, including non-U.S. citizens who resided in the United States while employed at D&M, complied with Schlumberger Ltd.’s sanctions policies and compliance procedures. As a result of D&M’s lack of adherence to U.S. sanctions combined with SOHL’s failure to train properly U.S. persons and to enforce fully its policies and procedures, D&M, through the acts of employees residing in the United States, violated U.S. sanctions against Iran and Sudan by: (1) approving and disguising the company’s capital expenditure requests from Iran and Sudan for the manufacture of new oilfield drilling tools and for the spending of money for certain company purchases; (2) making and implementing business decisions specifically concerning Iran and Sudan; and (3) providing certain technical services and expertise in order to troubleshoot mechanical failures and to sustain expensive drilling tools and related equipment in Iran and Sudan.
The investigation that commenced in 2009 was led by the Justice Department’s National Security Division, the U.S. Attorney’s Office of the District of Columbia and the U.S. Department of Commerce BIS’ Dallas Field Office. Assistant Attorney General Carlin is grateful to Special Agent Troy Shaffer from BIS’ Dallas Field Office for his excellent work. Assistant Attorney General Carlin also acknowledged the work of those who handled the case from the National Security Division and the U.S. Attorney’s Office, including former Trial Attorney Ryan Fayhee and former Assistant U.S. Attorneys John Borchert and Ann H. Petalas.
The case was prosecuted by Trial Attorney Casey Arrowood of the National Security Division, Assistant U.S. Attorney Maia L. Miller of the National Security Section and Assistant U.S. Attorney Zia Faruqui of the District of Columbia.
Federal Court Issues Judgment Memorializing Sentence of Schlumberger Oilfield Holdings Ltd. for Violating U.S. Sanctions by Facilitating Trade with Iran and SudanRead the Press Release
WASHINGTON – The U.S. District Court for the District of Columbia entered a formal judgment yesterday memorializing the sentence requiring Schlumberger Oilfield Holdings Ltd. (SOHL), a wholly-owned subsidiary of Schlumberger Ltd., to pay a $232,708,356 penalty to the United States for conspiring to violate the International Emergency Economic Powers Act (IEEPA) by willfully facilitating illegal transactions and engaging in trade with Iran and Sudan.
The judgment was announced by Acting U.S. Attorney Vincent H. Cohen, Jr. of the District of Columbia, Assistant Attorney General for National Security John P. Carlin, and Under Secretary Eric L. Hirschhorn of the U.S. Commerce Department’s Bureau of Industry and Security (BIS).
At a hearing on April 30, 2015, the Honorable John D. Bates accepted the company’s guilty plea and sentenced the company to the proposed sentence articulated in the plea agreement, which called for the fine and other terms of corporate probation. The court recognized the seriousness of SOHL’s criminal conduct, which posed a threat to our national security. In addition, the court noted that the scope of criminal conduct justified the large monetary penalty imposed. Finally, the court concluded that the terms of probation provided adequate deterrence to SOHL as well as other companies. Yesterday, the court entered the written judgment confirming the sentence imposed on April 30, 2015.
“This guilty plea and sentence hold this company accountable for violating trade laws by doing business with sanctioned countries and undermining the interests of the United States,” said Acting U.S. Attorney Cohen. “We hope that other companies tempted to break our export laws take note of the $232.7 million penalty that will be paid in this case.”
“The court’s judgment represents a milestone in the enforcement of U.S. sanctions laws,” said Assistant Attorney General Carlin. “This case marks the first conviction of a corporate entity for facilitating violations of the International Economic Emergency Powers Act and the highest criminal fine ever imposed in a sanctions prosecution. The Court’s imposition of this serious sentence should serve as a strong deterrent for multinational corporations doing any business in countries subject to U.S. economic sanctions.”
The criminal information and plea agreement were filed on March 25, 2015, in federal court in the District of Columbia, charging SOHL with one count of knowingly and willfully conspiring to violate IEEPA. The plea agreement that the court approved also requires SOHL to submit to a three-year period of corporate probation and agree to continue to cooperate with the government and not commit any additional felony violations of U.S. federal law. SOHL’s monetary penalty includes a $77,569,452 criminal forfeiture and an additional $155,138,904 criminal fine. The criminal fine represents the largest criminal fine in connection with an IEEPA prosecution. In addition to SOHL’s commitments, under the plea agreement SOHL’s parent company, Schlumberger Ltd., has also agreed to the following terms during the three-year term of probation, among others: maintaining its cessation of all operations in Iran and Sudan, reporting on the parent company’s compliance with sanctions, responding to requests to disclose information and materials related to the parent company’s compliance with U.S. sanctions laws when requested by U.S. authorities, and hiring an independent consultant to review the parent company’s internal sanctions policies and procedures and the parent company’s internal audits focused on sanctions compliance.
The court agreed that in addition to SOHL continuing its cooperation with U.S. authorities throughout the three-year period of probation and agreeing not to engage in any felony violation of U.S. federal law, SOHL’s parent company, Schlumberger Ltd., will also hire an independent consultant who will review the parent company’s internal sanctions policies, procedures and company-generated sanctions audit reports.
According to court documents, starting on or about early 2004 and continuing through June 2010, Drilling & Measurements (D&M), a United States-based Schlumberger business segment, provided oilfield services to Schlumberger customers in Iran and Sudan through non-U.S. subsidiaries of SOHL. Although SOHL, as a subsidiary of Schlumberger Ltd., had policies and procedures designed to ensure that D&M did not violate U.S. sanctions, SOHL failed to train its employees adequately to ensure that all U.S. persons, including non-U.S. citizens who resided in the United States while employed at D&M, complied with Schlumberger Ltd.’s sanctions policies and compliance procedures. As a result of D&M’s lack of adherence to U.S. sanctions combined with SOHL’s failure to train properly U.S. persons and to enforce fully its policies and procedures, D&M, through the acts of employees residing in the United States, violated U.S. sanctions against Iran and Sudan by: (1) approving and disguising the company’s capital expenditure requests from Iran and Sudan for the manufacture of new oilfield drilling tools and for the spending of money for certain company purchases; (2) making and implementing business decisions specifically concerning Iran and Sudan; and (3) providing certain technical services and expertise in order to troubleshoot mechanical failures and to sustain expensive drilling tools and related equipment in Iran and Sudan.
The investigation that commenced in 2009 was led by the Justice Department’s National Security Division, the U.S. Attorney’s Office of the District of Columbia and the U.S. Department of Commerce BIS’s Dallas Field Office. Acting U.S. Attorney Cohen and Assistant Attorney General Carlin are grateful to Special Agent Troy Shaffer from BIS’ Dallas Field Office for his excellent work. They also acknowledged the work of those who handled the case from the National Security Division and the U.S. Attorney’s Office, including former Trial Attorney Ryan Fayhee and former Assistant U.S. Attorneys John Borchert and Ann H. Petalas.
The case was prosecuted by Assistant U.S. Attorney Maia L. Miller of the National Security Section of the U.S. Attorney’s Office for the District of Columbia, Trial Attorney Casey Arrowood of the Justice Department’s National Security Division, and Assistant U.S. Attorney Zia Faruqui of the Asset Forfeiture and Money Laundering Section of the U.S. Attorney’s Office for the District of Columbia.
Elyria man indicted for sending letter purporting to contain anthraxRead the Press Release
A federal grand jury returned a federal indictment charging Drew D. Manns, 31, of Elyria, with using the United States Postal Service to make threats with a white powdery substance, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio.
Manns sent Summit County Clerks and Prosecutor’s Office letters including a white powdery substance, and identified the substance as anthrax in the body of the accompanying letters, according to the indictment.
The Summit County Prosecutor’s Office conducted the investigation. The case is being prosecuted by Assistant United States Attorney Marisa T. Darden.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial, in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
El Departamento de Justicia llega a acuerdo conciliatorio con Evergreen Bank Group para resolver alegatos de discriminación en préstamos para motocicletasRead the Press Release
WASHINGTON – El Departamento de Justicia anunció hoy que Evergreen Bank Group de Oak Brook, Illinois eliminará o limitará la libertad de discreción que les da a los vendedores de motocicletas de incrementar las tasas de interés como parte de un acuerdo conciliatorio de una demanda federal que alega un patrón o una práctica de discriminación por origen nacional y raza en préstamos para motocicletas. Además de la eliminación de la libertad de discreción, lo que coincide con una política que Evergreen adoptó voluntariamente en marzo de 2014, el acuerdo conciliatorio ofrecerá 395,000 dólares en compensación a víctimas de actos de discriminación pasados de Evergreen.
El acuerdo conciliatorio, que sigue estando sujeto a la aprobación del tribunal, fue presentado hoy con la denuncia del departamento en el Tribunal Federal de Distrito del Distrito Norte de Illinois. La denuncia alega que Evergreen violó la Ley de Igualdad de Oportunidades de Crédito [Equal Credit Opportunity Act (ECOA)] al cobrar a alrededor de 2,200 prestatarios hispanos y afroestadounidenses mayores tasas de interés que a prestatarios blancos no hispanos entre enero de 2011 y marzo de 2014. La denuncia alega que la unidad de préstamos para motocicletas FreedomRoad Financial de Evergreen les cobró a los prestatarios mayores tasas de interés debido a su origen nacional o raza y no debido a su solvencia u otros criterios objetivos relacionados con el riesgo crediticio. Este cargo discriminatorio hacía que la víctima promedio pagara de 200 a 250 dólares adicionales aproximadamente durante el término del préstamo.
“El departamento, en cooperación con nuestras dependencias asociadas, sigue examinando detenidamente el mercado de préstamos para vehículos motorizados en busca de actos de discriminación potencial”, dijo la Secretaria de Justicia Auxiliar Adjunta Principal Vanita Gupta de la División de Derechos Civiles. “Agradecemos a Evergreen por reconocer el riesgo de discriminación provocado por sobreprecios discrecionales de los vendedores y por adoptar nuevas políticas de compensación a vendedores que reducen significativamente ese riesgo”.
En vez de recibir las solicitudes directamente de los clientes, Evergreen realiza la mayor parte de sus préstamos para motocicletas a través de aproximadamente 400 vendedores de motocicletas en todo el país que ayudan a sus clientes a pagar su motocicleta nueva o usada presentando sus solicitudes de préstamo a Evergreen.
Hasta marzo de 2014, la práctica comercial de Evergreen, como la de muchos prestamistas para vehículos motorizados, permitía que los vendedores de motocicletas variaran según su propia discreción subjetiva y sin orientación la tasa de interés de un préstamo respecto del precio determinado inicialmente por Evergreen. Los vendedores recibían mayores pagos de Evergreen por préstamos que incluían un mayor margen de ganancias por tasa de interés. La demanda de diciembre de 2013 del departamento contra Ally Financial Inc. y Ally Bank, que generó un acuerdo conciliatorio que establecía una compensación de 80 millones de dólares para los prestatarios, implicó un sistema de compensaciones parecido.
En marzo de 2014, Evergreen eliminó la libertad de discreción de los vendedores de motocicletas para incrementar las tasas de interés. En su lugar, Evergreen adoptó una política por la cual siempre se compensa a los vendedores con base en un porcentaje de la suma principal del préstamo que no varía según la tasa de interés del préstamo. No se observó discriminación cuando los Estados Unidos analizaron préstamos otorgados bajo la nueva política. El acuerdo conciliatorio permite que Evergreen siga utilizando la política revisada de compensación que adoptó en marzo de 2014.
La demanda se originó en una remisión de marzo de 2013 a la División de Derechos Civiles del Departamento de Justicia por parte de la Federal Deposit Insurance Corporation (FDIC). Evergreen está regulada por la FDIC.
La coacción asociada a las leyes de otorgamiento justo de préstamos por parte del Departamento de Justicia es llevada a cabo por la Unidad de Préstamos Justos de la Sección de Vivienda y Cumplimiento de la Ley Civil de la División de Derechos Civiles. Desde que se estableció la Unidad de Préstamos Justos en febrero de 2010, ésta entabló o resolvió 38 casos de préstamos bajo la Ley de Vivienda Justa (FHA), la ECOA y la Ley de Alivio Civil para los Miembros de las Fuerzas Armadas [Servicemembers Civil Relief Act]. Los acuerdos conciliatorios en estos casos proveen más de 1,200 millones de dólares en asistencia monetaria para comunidades impactadas y prestatarios individuales. Los informes anuales del Secretario de Justicia de EE.UU. al Congreso sobre la ECOA destacan los logros del Departamento en el otorgamiento de préstamos justos y están disponibles en www.justice.gov/crt/publications/.
La División de Derechos Civiles, la Fiscalía Federal para el Distrito Norte de Illinois y la FDIC son miembros de la Fuerza de Tarea de Coacción contra el Fraude Financiero. El Presidente Obama fundó esta fuerza de tarea para generar una iniciativa enérgica, coordinada y proactiva para investigar y enjuiciar los delitos financieros. La fuerza de tarea incluye a representantes de una amplia gama de agencias federales, autoridades regulatorias, inspectores generales y fuerzas del orden público estatales y locales quienes, trabajando juntos, implementan un conjunto poderoso de recursos de coacción penal y civil. La fuerza de tarea está trabajando para mejorar las iniciativas en todo el poder ejecutivo federal y, junto con asociados estatales y locales, investigar y enjuiciar delitos financieros importantes, garantizar un castigo justo y eficaz para quienes cometen delitos financieros, combatir la discriminación en los mercados financieros y de préstamos, y recuperar ganancias para las víctimas de delitos financieros. Para obtener más información sobre la fuerza de tarea, visitar www.StopFraud.gov.
El acuerdo conciliatorio estipula la existencia de un administrador independiente que ubique a las víctimas y distribuya los pagos sin costo para los prestatarios identificados por el departamento como víctimas de actos de discriminación de Evergreen. El departamento hará un anuncio público y publicará información en su portal de Internet cuando existan más detalles sobre el proceso de compensación. El administrador del acuerdo se comunicará con los prestatarios que sean elegibles para recibir compensación del acuerdo conciliatorio y no necesitan comunicarse con el departamento en este momento. Las personas que crean haber sido víctimas de actos de discriminación en préstamos por parte de Evergreen y tengan preguntas sobre el acuerdo conciliatorio pueden comunicarse con el departamento llamando al 202-514-4713.
Para obtener una copia de la demanda y de la orden de acuerdo conciliatorio propuesto, así como también información adicional sobre la labor del Departamento de Justicia de los Estados Unidos para hacer valer las leyes de otorgamiento justo de préstamos, visite el portal del Departamento de Justicia de los Estados Unidos en www.justice.gov/fairhousing.
Eagle Butte Woman Sentenced for Second Degree Murder of A ChildRead the Press Release
Acting United States Attorney Randolph J. Seiler announced that an Eagle Butte, South Dakota, woman convicted of Second Degree Murder was sentenced on May 4, 2015, by U.S. District Judge Roberto A. Lange.
Jordyn Blue Coat, a/k/a Jordyn Swan, age 21, was sentenced to 240 months in custody, 3 years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Blue Coat was indicted by a federal grand jury on October 21, 2014, for Child Abuse. On February 2, 2015, she pled guilty to a Superseding Information charging her with Second Degree Murder of a Child.
The conviction stems from an incident that occurred on October 17, 2014, when Blue Coat was the caretaker of a 20-month old child. According to Blue Coat, in the last two months of the child’s life, he frequently cried and was hard to console. The evening of October 17, the child had a messy diaper, which Blue Coat changed and temporarily left on the bedroom floor near the child, while she stepped out to use the restroom. When she returned, the child had gotten ahold of the dirty diaper and had feces all over his clothes and himself. At this time, Blue Coat became angry, lost control of her emotions and kicked the child in the head. The kick pushed the child’s head into a television stand in the bedroom. As a result, the child was unconscious and his head began to swell from the injury he received. After spending some time trying to awaken the child, Blue Coat took him to the emergency room at the Indian Health Services (IHS) Hospital in Eagle Butte.
Blue Coat told hospital medical providers that the child had “fallen two days ago in the park” and hit his head. She did not provide an accurate medical history. The child was unresponsive at the hospital. Additionally, there was swelling around the child’s left ear, eyes were swollen shut, and there was a large burn injury to the leg. The child also had multiple chronic and acute burn injuries throughout his body. Doctors at IHS immediately suspected the child had a closed head injury and air evacuated him to Rapid City Regional Hospital, where emergency medical personnel worked on him for four hours. The child died in the emergency room on October 18, 2014.
The autopsy report listed the cause of death as blunt force trauma to the head that caused acute subdural hemorrhaging, and led to bilateral cerebral brain failure. The autopsy also revealed multiple burns, contusions, abrasions, and injuries to the child’s head, face, and feet, along with old and recent bone fractures.
The investigation was conducted by the Federal Bureau of Investigation, the South Dakota Department of Social Services, and the Cheyenne River Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Mikal Hanson prosecuted the case.
Blue Coat was immediately turned over to the custody of the U.S. Marshals Service to begin serving her sentence.
Eagle Butte Man Sentenced for Misprision of A FelonyRead the Press Release
Acting United States Attorney Randolph J. Seiler announced that an Eagle Butte, South Dakota, man was convicted of Misprision of a Felony and was sentenced on May 4, 2015, by U.S. District Judge Roberto A. Lange.
Robert McLane, age 29, was sentenced to 1 month in custody, 12 months of supervised release, $925 in restitution, and a $100 special assessment to the Federal Crime Victims Fund.
McLane was indicted by a federal grand jury on July 15, 2014, for Possession and Sale of a Stolen Firearm. On February 24, 2015, McLane pled guilty to a Superseding Information charging him with Misprision of a Felony.
The conviction arose from an incident that occurred on October 4, 2013, at Eagle Butte, when McLane failed to report a serious crime, even though he was very aware that the federal crimes of burglary and larceny had been committed.
This case was investigated by the Cheyenne River Sioux Tribe Law Enforcement Division. Assistant U.S. Attorney Mikal Hanson prosecuted the case.
Eagle Butte Man Sentenced for Assault with A Dangerous WeaponRead the Press Release
Acting United States Attorney Randolph J. Seiler announced that an Eagle Butte, South Dakota, man convicted of Assault with a Dangerous Weapon was sentenced on May 4, 2015, by U.S. District Judge Roberto A. Lange.
Kenny Fiddler, age 34, was sentenced to 27 months in custody, 2 years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Fiddler was indicted by a federal grand jury on December 9, 2014, and pled guilty to Assault with a Dangerous Weapon on March 3, 2015.
The conviction arose from an August 23, 2014, incident in Eagle Butte, when Fiddler took a folding knife, put the blade to the back of the victim’s neck and threatened to do bodily harm to the victim, an adult male.
This case was investigated by the Cheyenne River Sioux Tribe Law Enforcement Division. Assistant U.S. Attorney Mikal Hanson prosecuted the case.
Douglas Man Pleads Guilty to Federal Child Exploitation ChargesRead the Press Release
BOSTON – A Douglas man pleaded guilty yesterday in U.S. District Court in Worcester to attempting to travel to New York to engage in illicit sexual conduct with an undercover federal agent posing as a teenage girl.
Scot Trudeau, 40, pleaded guilty to one count of attempting to travel to engage in illicit sexual conduct with a minor. U.S. District Court Judge Timothy S. Hillman scheduled sentencing for Aug. 18, 2015.
The investigation of Trudeau’s conduct began after federal law enforcement in New York received complaints from an internet watchdog that Trudeau was engaged in questionable online communications concerning minors. As a result, agents created a fictitious persona for a 13-year-old girl, “Casey,” and, via email, introduced “Casey” to Trudeau. From September 2013 to January 2014, Trudeau communicated with “Casey” in dozens of emails. In the course of these communications, Trudeau, who was in Massachusetts, proposed several times that the two meet near “Casey’s” supposed home in New York, and graphically described sexual acts that Trudeau wished to perform with her. Trudeau was arrested in February 2014, and subsequently confessed.
The charging statute provides for a sentence of no greater than 30 years in prison, a minimum term of five years and up to a lifetime of supervised release, and a fine of $250,000. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz and Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Mark J. Grady of Ortiz’s Worcester Branch Office.
The case is brought as part of Project Safe Childhood. In 2006, the Department of Justice created Project Safe Childhood, a nationwide initiative designed to protect children from exploitation and abuse. Led by the U.S. Attorneys’ Offices and the DOJ’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend, and prosecute individuals who exploit children, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov/.
Detroit Residents Sentenced for Defrauding Internal Revenue Service with Identities of Deceased IndividualsRead the Press Release
Two Detroit residents were sentenced after pleading guilty to charges of wire fraud and aiding and abetting in the use of false identification, Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division, U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan and Special Agent in Charge Jarod Koopman of Internal Revenue Service-Criminal Investigation (IRS-CI) announced today.
McAllen Knight and Renita Adams were each sentenced to serve 18 months in prison by U.S. District Court Judge Avern Cohn of the Eastern District of Michigan. Knight’s mother, sister and stepfather also pleaded guilty to wire fraud and aiding and abetting in the use of false identification. Brenda Knight, Knight’s mother, and Adreann Turnage, Knight’s sister, were sentenced on April 14 to serve 24 and 18 months in prison, respectively. Willie Watkins, Knight’s stepfather, was sentenced on April 29, 2014, to serve 30 months in prison. All five defendants were ordered to pay $410,949 in restitution.
According to court records, Adams and McAllen Knight participated in a scheme with Watkins, Brenda Knight and Adreann Turnage to defraud the United States by using the names and social security numbers of recently deceased individuals to prepare fraudulent tax returns. They filed hundreds of fraudulent 2010 tax returns. The returns sought refunds by making false claims for the Earned Income Credit, Education Credits and the Making Work Pay Credit. The returns were transmitted electronically, utilizing public access Internet connections from local hotels and coffee shops. An Internet account registered to Adams was used to transmit 306 fraudulent returns. The refunds were directed to bank accounts that were established for the sole purpose of receiving the fraudulent refunds. McAllen Knight caused some of these bank accounts to be opened by others to receive the deposits of the false tax refunds. Adams helped distribute the proceeds of the fraudulently obtained tax refunds at the direction of her fellow participants and retained a portion of the proceeds for her own benefit.
The investigation of this case was conducted by special agents of IRS-CI and prosecuted by Assistant U.S. Attorney Ross I. MacKenzie of the Eastern District of Michigan and Trial Attorney Kenneth Vert of the Tax Division.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Corning Man Pleads Guilty to Theft from Health Care FundRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051ROCHESTER, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that Brandon Wilson, 26, of Corning, NY, pleaded guilty to theft from a health care benefit program, before U.S. Magistrate Judge Marian W. Payson. The charge carries a maximum penalty of one year in prison and a $5,000 fine.
Assistant U.S. Attorney John J. Field, who is handling the case, stated that Wilson, a member of the Plumbers & Steamfitters Local 267, participated in a scheme devised by Paul Harnas, Jr. to submit fraudulent dental claims for reimbursement from the Local 267 health fund. The defendant sought fraudulent payments totaling $6,358. In aggregate, Harnas, Wilson and others involved in the scheme submitted false claims to the Local 267 health fund totaling more than $65,000.
Harnas has been convicted and is awaiting sentencing.
The plea is the culmination of an investigation by Special Agents of the United States Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, under the direction of Special Agent in Charge Cheryl Garcia of the New York Regional Office, and the New York State Department of Financial Services, Frauds Bureau, under the direction of Superintendent Benjamin Lawsky.
Sentencing is scheduled for July 24, 2015 at 10:00 a.m. before Judge Payson.
Corinth Man Sentenced to Four Years for Possession of Child PornographyRead the Press Release
Contact: Andrew McCormack
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that David Livingston Brown, 41, of Corinth, Maine, was sentenced today in U.S. District Court by Judge George Z. Singal to four years in prison to be followed by eight years of supervised release for possession of child pornography. Brown pleaded guilty to the charge on July 28, 2014.
According to court records, in April 2013, Brown emailed a video containing child pornography to an undercover federal agent. On July 18, 2013, a search warrant was executed at the defendant’s residence in Corinth. The defendant admitted sending and receiving images of child pornography by email and collecting hundreds of images and videos of child pornography over several years. A forensic examination of computers and computer storage devices seized from the residence revealed hundreds of images and videos of child pornography.
The investigation was conducted jointly by the Federal Bureau of Investigation and the Maine State Police Computer Crimes Unit. This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Convicted California Sex Offender Pleads Guilty to Failure to Register as A Sex OffenderRead the Press Release
Jacksonville, Florida – United States Attorney A. Lee Bentley, III announces that David Eric Crews (54, Sacramento, CA) has pleaded guilty to a federal charge of failing to register as sex offender after traveling to Florida from California. He faces up to 10 years in federal prison. A sentencing date has not yet been set. Crews has been in custody since his arrest on March 30, 2015.
According to court documents, in March 1993, Crews was convicted of rape and sexual battery in Sacramento. Subsequent to his conviction, he traveled from California to Florida in December 2014. He failed to update his registration in California, and he did not register as a sex offender in Florida, as required by the Sex Offender Registration and Notification Act.
In March 2015, Deputy U.S. Marshals went to a campground in Bunnell, Florida and observed Crews setting up musical equipment on a stage at an outdoor venue. He and other members of his band had been playing at the park nightly. Crews had been living in a motor home at the campground since December 22, 2014.
The Sex Offender Registration and Notification Act is part of the Adam Walsh Child Protection and Safety Act of 2006. The Adam Walsh Act provides for the use of federal law enforcement resources, including the United States Marshals Service, to assist state and local authorities in locating and apprehending non-compliant sex offenders. This case was investigated by the United States Marshals Service and the Florida Department of Law Enforcement. It is being 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.
Cincinnati-Area Man Charged with Attempting to Provide Material Support to ISILRead the Press Release
A federal grand jury has brought an additional charge against Christopher Lee Cornell, 21, of Green Township, Ohio. In a superseding indictment returned in Cincinnati, he is now also charged with attempting to provide material support to a designated foreign terrorist organization.
The charge is in addition to the original Jan. 21, 2015, indictment that charged Cornell with attempting to kill officers and employees of the United States, solicitation to commit a crime of violence and possession of a firearm in furtherance of a crime of violence. Cornell was charged for his alleged participation in a plot to attack the U.S. Capitol Building and kill government officials.
The superseding indictment, which was returned today, was announced by Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Carter M. Stewart of the Southern District of Ohio and Special Agent in Charge Angela L. Byers of the FBI’s Cincinnati Field Division.
The four-count superseding indictment alleges that on or about August 2014 through January 2015, Cornell allegedly plotted, planned and attempted to attack the U.S. Capitol.
The defendant is also alleged to have attempted to provide material support and resources to a foreign terrorist organization, specifically the Islamic State of Iraq and the Levant (ISIL), knowing that the organization was a designated foreign terrorist organization and that the organization had engaged in and was continuing to engage in terrorist activity. Material support and resources consisted of personnel in the form of the defendant himself by plotting and attempting to execute an attack on the U.S. Capitol.
Cornell allegedly attempted to kill officers and employees of the United States during their official duties, specifically by attempting to attack the U.S. Capitol Building. During that same time, the defendant allegedly attempted to persuade others to kill officers and employees of the United States. Cornell also allegedly possessed two semi-automatic rifles and approximately 600 rounds of ammunition.
Providing material support to a designated foreign terrorist organization carries a potential maximum sentence of 15 years in prison. Attempted murder of government employees and officials is a crime punishable by up to 20 years in prison. Solicitation to commit an attempted murder is a crime punishable by 20 years in prison. Possession of a firearm in furtherance of an attempted crime of violence is a crime punishable by a mandatory sentence of five years in prison.
Cornell was arrested on Jan. 14, 2015, by the FBI’s Joint Terrorism Task Force (JTTF). The JTTF is made up of officers and agents from the Cincinnati Police Department; Colerain, Ohio, Police Department; Dayton, Ohio, Police Department; Ohio State Highway Patrol; U.S. Immigrations and Customs Enforcement; U.S. Secret Service; and West Chester, Ohio, Police Department.
Assistant Attorney General Carlin and U.S. Attorney Stewart commended the investigation of this case by the JTTF. The case is being prosecuted by Trial Attorney Michael Dittoe of the Justice Department’s National Security Division and Assistant U.S. Attorney Tim Mangan of the Southern District of Ohio.
An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.
Cornell Superseding Indictment
Cincinnati-Area Man Charged with Attempting to Provide Material Support to ISILRead the Press Release
WASHINGTON – A federal grand jury has brought additional charge against Christopher Lee Cornell, 21, of Green Township, Ohio. In a superseding indictment returned in Cincinnati, he is now also charged with attempting to provide material support to a designated foreign terrorist organization.
The charge is in addition to the original Jan. 21, 2015, indictment that charged Cornell with attempting to kill officers and employees of the United States, solicitation to commit a crime of violence and possession of a firearm in furtherance of a crime of violence. Cornell was charged for his alleged participation in a plot to attack the U.S. Capitol Building and kill government officials.
The superseding indictment, which was returned today, was announced by Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Carter M. Stewart of the Southern District of Ohio, Special Agent in Charge Angela L. Byers of the FBI’s Cincinnati Field Division and Special Agent in Charge Mark Porter of the U.S. Secret Service.
The four-count superseding indictment alleges that on or about August 2014 through January 2015, Cornell allegedly plotted, planned and attempted to attack the U.S. Capitol.
The defendant is also alleged to have attempted to provide material support and resources to a foreign terrorist organization, specifically the Islamic State of Iraq and the Levant (ISIL), knowing that the organization was a designated foreign terrorist organization and that the organization had engaged in and was continuing to engage in terrorist activity. Material support and resources consisted of personnel in the form of the defendant himself by plotting and attempting to execute an attack on the U.S. Capitol.
Cornell allegedly attempted to kill officers and employees of the United States during their official duties, specifically by attempting to attack the U.S. Capitol Building. During that same time, the defendant allegedly attempted to persuade others to kill officers and employees of the United States. Cornell also allegedly possessed two semi-automatic rifles and approximately 600 rounds of ammunition.Providing material support to a designated foreign terrorist organization carries a potential maximum sentence of 15 years in prison. Attempted murder of government employees and officials is a crime punishable by up to 20 years in prison. Solicitation to commit an attempted murder is a crime punishable by 20 years in prison. Possession of a firearm in furtherance of an attempted crime of violence is a crime punishable by a mandatory sentence of five years in prison.
Cornell was arrested on Jan. 14, 2015, by the FBI’s Joint Terrorism Task Force (JTTF). The JTTF is made up of officers and agents from the Cincinnati Police Department; Colerain, Ohio, Police Department; Dayton, Ohio, Police Department; Ohio State Highway Patrol; U.S. Immigrations and Customs Enforcement; U.S. Secret Service; and West Chester, Ohio, Police Department.
Assistant Attorney General Carlin and U.S. Attorney Stewart commended the investigation of this case by the JTTF. The case is being prosecuted by Trial Attorney Michael Dittoe of the Justice Department’s National Security Division and Assistant U.S. Attorney Tim Mangan of the Southern District of Ohio.
An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.
Chicago Man Sentenced for Criminal TrespassRead the Press Release
Acting United States Attorney Randolph J. Seiler announced that a Chicago, Illinois, man charged with Criminal Trespass pled guilty to and was sentenced on April 28, 2015, by U.S. Magistrate Judge Mark A. Moreno.
Steven Nichols, age 44, was sentenced to 12 months in custody, 1 year of supervised release, a $25 assessment to the Federal Crime Victims Fund, and ordered to not re-enter the lands of Todd County and the Rosebud Sioux Indian Reservation.
In the summer of 2011, the Rosebud Sioux Tribe’s Attorney General petitioned the tribal court to bar Nichols, a non-Indian, from entering the lands of the Rosebud Sioux Indian Reservation. On June 10, 2011, he was served with notice of the proceedings. On September 22, 2011, the Rosebud Sioux Tribal Court entered an Emergency Writ of Exclusion barring him from entering the lands of the Rosebud reservation, and the Rosebud Sioux Tribal Council voted to exclude the Defendant from the reservation. On September 23, 2011, a tribal law enforcement officer served him with the exclusionary order and escorted him off of the reservation.
Tribal law enforcement officers later learned that Nichols had re-entered the reservation. On September 9, 2012, officers apprehended him and again transported him off of the reservation. On January 30, 2013, officers learned Nichols was staying at a residence within the reservation, and upon searching the residence, found him hiding in a crawl space. He was arrested on federal criminal trespass charges and transported off of the reservation and into federal custody.
On March 14, 2014, Nichols was in a car near Two Strike, when a tribal patrol officer encountered him driving towards St. Francis, located within the Rosebud reservation. By being on the reservation, the Defendant defied orders to leave that were previously communicated to him. Nichols was convicted of criminal trespass and sentenced to nine months custody on September 30, 2014.
Nichols was placed at the Work Release Program in Winner on December 11, 2014. On January 16, 2015, Nichols was on a furlough and trespassed onto the Rosebud reservation. Nichols went to a home in St. Francis, and the occupant of the home called the police and Nichols was detained by law enforcement.
Nichols has repeatedly trespassed on the Rosebud Sioux Indian Reservation and, since 2013, this is his fourth conviction or Criminal Trespass in federal court. This conviction resulted in the statutory maximum of 12 months in custody.
The investigation was conducted by the Rosebud Sioux Tribe Law Enforcement Services and the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorney Tim Maher.
Nichols was remanded to the custody of the U.S. Marshals Service to complete his sentence.