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Friday 20 March 2015
Manhattan U.S. Attorney Announces Conviction of Mikhail Zemlyansky on Racketeering, Securities Fraud, Mail Fraud, and Wire Fraud ChargesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that MIKHAIL ZEMLYANSKY was found guilty yesterday on racketeering conspiracy, securities fraud, mail fraud, and wire fraud charges following a four-week jury trial before United States District Judge J. Paul Oetken. The jury convicted ZEMLYANSKY of racketeering stemming from the largest single no-fault automobile insurance fraud scheme ever charged, and his two investment fraud schemes, Lyons Ward & Associates and the Rockford Group.
U.S. Attorney Preet Bharara said: “Mikhail Zemlyansky now stands convicted of spearheading three fraud schemes: one in which the defendant and his co-conspirators billed insurance companies for over $100 million in fraudulent medical treatments, and two that swindled investors out of over $18 million. Worse yet, Zemlyansky laundered the fruits of his crimes through check-cashing entities and shell companies, and invested his criminal proceeds on luxury items. Today’s verdict ensures that he will be punished for the vortex of fraud he orchestrated.”
According to the allegations in the Superseding Indictment and evidence admitted at trial:
From 2007 through 2012, ZEMLYANSKY was a leader of an enterprise engaged in a pattern of racketeering that included a massive scheme to defraud automobile insurance companies under New York’s no-fault insurance law, multiple securities fraud schemes, money laundering, and the operation of illegal gambling businesses.
Under New York State Law, every vehicle registered in the State is required to have no-fault automobile insurance, which enables the driver and passengers of a registered and insured vehicle to obtain benefits of up to $50,000 per person for injuries sustained in an automobile accident, regardless of fault (the “No-Fault Law”). The No-Fault Law requires prompt payment for medical treatment, thereby obviating the need for claimants to file personal injury lawsuits in order to be reimbursed. Under the No-Fault Law, patients can assign their right to reimbursement from an insurance company to others, including medical clinics that provide treatment for their injuries. New York State law also requires that all medical clinics in the state be incorporated, owned, operated, and/or controlled by a licensed medical practitioner in order to be eligible for reimbursement under the No-Fault Law. Insurance companies will not honor claims for medical treatments from a medical clinic that is not actually owned, operated, and controlled by a licensed medical professional.
From 2007 through 2012, ZEMLYANSKY’S organization defrauded automobile insurance companies of more than $100 million by, among other things, creating and operating medical clinics that provided unnecessary and excessive medical treatments in order to take advantage of the No-Fault Law. In addition, ZEMLYANSKY’S organization fraudulently owned and controlled more than a dozen medical professional corporations (“PCs”) – including no-fault clinics, MRI offices, and acupuncture and chiropractic PCs – by paying licensed medical professionals to use their licenses to incorporate the professional corporations. ZEMLYANSKY and his co-conspirators paid kickbacks of thousands of dollars to runners to recruit patients to receive the same battery of tests and treatments, and received kickbacks from other co-conspirators for referring patients for additional unnecessary treatments. All told, ZEMLYANSKY’S organization billed insurance companies for more than $100 million in fraudulent medical treatments. Furthermore, ZEMLYANSKY and his co-conspirators further laundered the proceeds of the fraud through check-cashing entities and shell companies, and used the money to pay for luxury cars, watches and vacations.
In addition to the no-fault insurance fraud, ZEMLYANSKY was convicted for operating two investment fraud schemes that swindled innocent victims out of nearly $18 million. Both fraudulent entities – Lyons Ward & Associates and the Rockford Group – purported to be settlement claims funding companies that invested in lawsuits in return for a portion of future settlements. As part of these schemes, ZEMLYANSKY and his co-conspirators created bogus documents and account statements used by cold-callers working in boiler rooms to solicit victims through false representations. In reality, there was no investment fund at all; instead, ZEMLYANSKY and his co-conspirators simply stole the money invested by victims and laundered the proceeds by wiring them overseas to shell companies in Eastern Europe, which were then turned into cash in the United States.
Finally, ZEMLYANSKY’S organization operated high-stakes illegal poker games in Mill Basin, Brooklyn, that netted profits of tens of thousands of dollars per game.
ZEMLYANSKY was convicted of one count of conspiracy to commit racketeering, which carries a maximum sentence of 20 years in prison. In addition, ZEMLYANSKY was convicted of one count of conspiracy to commit securities fraud, which carries a maximum sentence of five years; mail fraud and wire fraud, which carries a maximum sentence of 20 years; as well as substantive counts of securities fraud, mail fraud and wire fraud, each carrying a maximum of 20 years. ZEMLYANSKY is scheduled to be sentenced on July 15, 2015, at 3:00 p.m., before Judge Oetken. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
ZEMLYANSKY, 37, of Hewlett, New York, was initially arrested on February 29, 2012, and is the 34th defendant convicted in this case. ZEMLYANSKY was remanded pending sentencing following his conviction.
At ZEMLYANSKY’S first trial in the fall of 2013, a mistrial was declared on Count One – which also charged ZEMLYANSKY with racketeering conspiracy – after the jury failed to reach a unanimous verdict. At that trial, ZEMLYANSKY was acquitted of eight counts of charges related to the no-fault insurance fraud scheme and money laundering.
U.S. Attorney Preet Bharara thanked the Federal Bureau of Investigation and the New York City Police Department for their continued outstanding work in this investigation. Mr. Bharara also thanked the National Insurance Crime Bureau, the investigative units of the insurance companies, the Manhattan District Attorney’s Office, and the Alabama Securities Commission for their valuable assistance with the investigation.
The case is being prosecuted by the Office’s Violent & Organized Crime Unit. Assistant U.S. Attorneys Daniel S. Goldman, Daniel S. Noble, and Joshua A. Naftalis are in charge of the prosecution. Assistant U.S. Attorney Carolina Fornos of the Office’s Money Laundering & Asset Forfeiture Unit is responsible for the forfeiture aspects of the case.
Man Sentenced to Prison for Maintaining A Drug HouseRead the Press Release
Larry Watson, 58, of East St. Louis, was sentenced to a total of 60 months in prison on an indictment charging him with Maintaining Drug-Involved Premises, as well as revocation of his supervised release, Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today. Following his prison sentence, Watson was ordered to be on federal supervised release for 3 years and to perform 200 hours of community service during those 3 years of supervised release. Watson was also ordered to pay a fine of $350, as well as a $100 special assessment.
Facts showed that on December 3, 2014, Watson pled guilty to an Indictment which charged maintaining drug-involved premises. Because Watson was on supervised release, that release was revoked and a concurrent sentence was given for the revocation.
This case was investigated by the Illinois State Police, Metropolitan Enforcement Group of Southwestern Illinois and the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorney Deirdre A. Durborow.
Man Charge in Post Office SchemeRead the Press Release
CHARLOTTE, N.C. – A federal grand jury returned a criminal indictment today against Jimmy Lee Williams, 47, charging him with 29 felony charges in connection with a fraudulent check fraud scheme that allegedly netted more than $650,000 in postage stamps and other merchandise, announced Jill Westmoreland Rose, Acting U.S. Attorney for the Western District of North Carolina. Williams is also known by several aliases including Jimmy Williamson.
Thomas L. Noyes, Inspector in Charge of the Charlotte Division of the U.S. Postal Inspection Service; John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division; and B.W. Collier, Acting Director of the North Carolina State Bureau of Investigation join Acting U.S. Attorney Rose in making todays’ announcement.
According to allegations contained in the indictment, in two separate time periods between November 2010 to present, Williams used two different networks of conspirators to defraud U.S. Post Offices and other businesses in the Southeast region. According to the indictment, Williams provided counterfeit checks and fake identification to his 16 accomplices, who used them to buy postage stamps, gift cards and other merchandise from U.S. Post Offices, retail stores and warehouses throughout North and South Carolina, Virginia, Maryland and the District of Columbia.
According to the indictment, Williams and/or his accomplices purchased postage stamps and other goods with a total face value of more than $650,000 using counterfeit or fraudulent checks. In the first scheme, Williams used counterfeit checks manufactured by Ronald Carr, who was charged last year in a related case with bank fraud and defrauding the United States. In the second scheme, Williams used checks drawn on his own closed accounts and the bank accounts of accomplices he met in prison and through youth football leagues in the Concord, North Carolina area. One such accomplice, Javorick Moore, was convicted in a related case in 2014 in the Eastern District of Virginia of defrauding the post office and other offenses. In both schemes, Williams’ accomplices gave the stamps they obtained to Williams, who then sold them to an Internet company in California as well as a North Carolina pawn shop, typically for 50%-70% of the face value. Williams carried out the first scheme while released on bond for a violation of a condition of supervised release arising from a previous federal conviction.
Williams has been charged with two counts of conspiracy which each carry a maximum prison term of five years and a $250,000 fine; five counts of making & counterfeit securities which carry a maximum of 10 years in prison and a $250,000 fine per count; five counts of theft of government property which carry a maximum of 10 years in prison and a $250,000 fine per count; five counts of receiving stolen government property which carry a maximum of 10 years in prison and a $250,000 fine per count; five counts of scheme to obtain bank property which carry a maximum of 30 years in prison and a $1 million fine per count; three counts of interstate transportation of stolen property which carry a maximum of 10 years in prison and a $250,000 fine per count; and one count of concealment money laundering which carries a maximum of 20 years in prison and a $500,000 fine.
Williams is currently in federal custody. He will be ordered to appear in court on the charges in the coming days.
The charges contained in the indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
USPIS, the FBI, and NC SBI investigated the case. Assistant U.S. Attorney Michael Savage, of the U.S. Attorney’s Office in Charlotte, is prosecuting the case.
Mississippi Man Sentenced to 37 Months in Prison for Tax FraudRead the Press Release
Jackson, Miss. – Flowers Curtis, a.k.a. Jim Curtis, 57, of Hermanville, Mississippi, was sentenced on Thursday, March 19, 2015 by Senior U.S. District Judge David C. Bramlette to 37 months in federal prison followed by three years of supervised release for committing tax fraud, U.S. Attorney Gregory K. Davis announced. Curtis was also ordered to pay restitution in the amount of $185,176.00.
Following an August, 2014 jury trial before Senior U.S. District Judge David C. Bramlette III in Natchez, Curtis was convicted of seven counts of knowingly representing a false claim to the IRS. According to court documents, from on or about Jan. 17, 2009, to on or about Feb. 15, 2012, in Claiborne County and Franklin County, Mississippi, Curtis filed income tax returns for tax years 2008 through 2011 requesting payment of refunds which he knew to be fraudulent in nature. Curtis made the claims by preparing and causing to be prepared, U.S. Individual Income Tax Returns, Form 1040, which were then presented to the Internal Revenue Service for payment.
This case was investigated by the IRS Criminal Investigation and prosecuted by First Assistant U.S. Attorney Harold Brittain.
Lewis County, WV man convicted of oxycodone traffickingRead the Press Release
CLARKSBURG, WEST VIRGINIA – Isaac Tyler Waugh, 20, of Crawford, West Virginia, was convicted in federal court today of prescription painkiller trafficking, United States Attorney William J. Ihlenfeld, II, announced.
An investigation by the Lewis County Sheriff’s Office revealed that Waugh sold oxycodone in Lewis County, West Virginia in May 2014.
Waugh pled guilty today to two counts of “Distribution of Oxycodone.” He faces up to 20 years in prison and a fine of up to $1,000,000.00 on each count. 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 Stephen Warner is prosecuting the case on behalf of the government.
U.S. Magistrate Judge John S. Kaull presided.
Kodiak Man Indicted for AssaultRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that a Kodiak man was indicted by a federal grand jury in Anchorage, Alaska for Assault.
Michael Ensley, 55, of Kodiak, Alaska was charged with one count of assault causing serious bodily injury, and one count of unlawfully entering U.S. Coast Guard property, Coast Guard base Kodiak, to conduct the assault.
Assistant U.S. Attorney Bryan Schroder, who presented the case to the grand jury, indicated that Ensley faces a maximum sentence of 10 years in prison, and a $250,000 dollar fine. Under the U.S. Sentencing Guidelines, the actual sentence imposed will be based on a number of factors, including the seriousness of the offense and any prior criminal history of the defendant.
The U.S. Coast Guard Investigative Service and the Alaska State Troopers conducted the investigation leading to the indictment in this case.
An indictment is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
Jury Convicts Man of Filing 26 False Tax Claims and Obstructing IRSRead the Press Release
HOUSTON – Kenneth Robert Bruce has been convicted on all counts as charged, to include 26 counts of willfully filing a false claim against the U.S. and for obstructing the Internal Revenue Service (IRS), announced U.S. Attorney Kenneth Magidson. The verdict was returned late yesterday after a five-day trial and approximately 2 ½ hours of deliberation.
During trial, the jury heard that Bruce prepared 26 false income tax returns or amended income tax returns claiming a total of more than $9 million in false income tax refunds. One return was for himself and 25 were for other taxpayers.
Bruce attached false IRS forms 1099-OID (Original Issue Discount) to the tax returns, falsely reporting the taxpayers had received huge amounts of income from OID and had all or nearly all of the false amounts of income withheld for federal income taxes. The huge, false amounts of withholdings formed the bases for the claims for false claims for tax refunds.
The jury also convicted Bruce on one count of corruptly endeavoring to obstruct and impede the administration of the Internal Revenue Code.
U.S. District Judge Nancy Atlas presided over trial and has set sentencing for June 9, 2015. At that time Bruce faces up to five years on each count of filing a false claim and up to three years for the obstruction. Each conviction also carries as possible punishment a $250,000 fine.
The convictions were the result of an investigation by IRS - Criminal Investigation and the Treasury Inspector General for Tax Administration. Assistant U.S. Attorneys Charles J. Escher and Jim McAlister are prosecuting the case.
Judge Sentences Eastern Pennsylvania Man to 20 Years in Prison for Heroin Trafficking SchemeRead the Press Release
PITTSBURGH - A resident of Nazareth, Pa., has been sentenced in federal court to 20 years imprisonment followed by 10 years supervised release on his conviction of violating federal narcotics laws, United States Attorney David J. Hickton announced today.
Chief United States District Judge Joy Flowers Conti imposed the sentence on Keith Eutsey, age 39.
According to information presented to the court, from on or about March 1, 2014 and continuing thereafter to on or about April 3, 2014, Eutsey conspired with others to distribute and possess with intent to distribute 1 kilogram or more of heroin, a Schedule I controlled substance.
Assistant United States Attorneys Amy L. Johnston and Cindy K. Chung prosecuted this case on behalf of the government.
A federally administered Organized Crime and Drug Enforcement Task Force (OCDETF) conducted the investigation leading to successful prosecution of Eutsey. The task force is headed by the Federal Bureau of Investigation and is comprised of members drawn from the FBI Greater Pittsburgh Safe Street Task Force including Wilkinsburg Police Department, Allegheny County Sheriff’s Office, Pennsylvania Office of the Attorney General, Munhall Police Department, Duquesne Police Department, Monroeville Police Department, Allegheny County Police Department, West Mifflin Police Department, and the Pittsburgh Police Department. The OCDETF program supplies critical federal funding and coordination that allows federal and state agencies to work together to successfully identify, investigate, and prosecute major interstate and international drug trafficking organizations and other criminal enterprises.
Jamestown Man Indicted on Drug and Gun ChargesRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
BUFFALO, N.Y.–U.S. Attorney William J. Hochul, Jr. announced today that a federal grand jury has returned an indictment charging Ismael Burgos, 53, Jamestown, NY, with attempted possession with intent to distribute cocaine. The charge carries a maximum of 20 years in prison.
Assistant U.S. Attorney Caleb J. Petzoldt, who is handling the case, stated that according to the indictment, on January 27, 2015, the defendant attempted to receive a package which investigators determined contained a quantity of cocaine.
The indictment is the culmination of an investigation on the part of the United States Postal Inspection Service, under the direction of Shelly Binkowski, Inspector in Charge, Boston Division, and the Drug Enforcement Administration, under the direction of Special Agent in Charge James J. Hunt, New York Field Office.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
Jacksonville Man Charged with Advertising for Child PornographyRead the Press Release
Jacksonville, Florida – United States Attorney A. Lee Bentley, III announces the return of an indictment charging Chad Jason Lansford (29, Jacksonville) with advertising for child pornography. If convicted, he faces a mandatory minimum penalty of 15 years, up to 30 years, in federal prison, and a potential life term of supervision. During his initial court appearance, Lansford was ordered detained pending his arraignment and detention hearing scheduled for March 24, 2015.
An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent until, and unless, proven guilty.
This case was investigated by the Federal Bureau of Investigation and the Jacksonville Sheriff’s Office. 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.
Indictment: Money Laundering Scheme Delivered $13 Million in Wages to Undocumented WorkersRead the Press Release
KANSAS CITY, KAN. – A Lawrence contractor and five other people have been charged with money laundering, bank fraud and harboring undocumented workers, said U.S. Attorney Barry Grissom. A federal indictment unsealed today alleges they were part of a scheme to convert more than $13 million in payroll checks into cash to pay crews of undocumented workers installing drywall in the Kansas City metro area.
“The indictment alleges the money flowed through an illegal pipeline,” said U.S. Attorney Barry Grissom. “At one end were contractors who wanted cheap labor. At the other end were undocumented workers who needed a job.”
Charged in the case are:
- Keith L. Countess, 55, Lawrence, Kan., owner of Plaster Masters, L.C., a drywall subcontractor for commercial and residential construction projects. The company is located at 619 N. 2nd in Lawrence.
- Marcos Lane Stubbs, 44, who is alleged to have devised the scheme to enable drywall subcontractors to use undocumented workers.
- Luis Felipe Guerrero-Guerrero, 26, who is alleged to have managed crews of workers installing drywall.
- Jose Felipe Hernandez-Calvillo, 39, who is alleged to have managed a crew of workers installing drywall.
- Mauro Papalotzi, 34, who is alleged to have managed crews of workers installing drywall.
- Isaac Gallegos, 35, who is alleged to have allowed the scheme to be operated out of his Boost Mobile telephone store. It was located in the 1300 block of Santa Fe in Olathe, Kan.
The indictment alleges the scheme revolved around another man – Jose R. Torres, 51 – who was charged and convicted in a separate case. Torres pleaded guilty to one count of harboring undocumented workers and one count of operating an unlicensed money transmitting business. He is awaiting sentencing.
The indictment alleges Gallegos and Stubbs first explained to Torres how the scheme would work and how he could make money by becoming a financial intermediary between drywall subcontractors and drywall construction crews made up primarily of undocumented workers. They told Torres that in order to pay undocumented workers someone had to serve as a financial conduit between the subcontractors and the workers. The subcontractors would contract directly with drywall crews but would use Torres as a financial intermediary.
The scheme involved Torres holding himself out as a drywall subcontractor while in fact his role was merely to receive checks from drywall construction crews, deposit the checks into his own accounts, withdraw cash from his accounts and pay the crew leaders, who in turn paid themselves and the members of the crews. Torres kept 5 percent as his fee.
To get the venture started, Torres borrowed $1,400 from Gallegos, who allowed him to work out of Gallego’s Boost Mobile store in Olathe. Drywall crews were paid weekly. The subcontractor made checks payable to “Jose R. Torres Drywall.” The checks were taken to Torres, usually at the Boost Mobile store. He would deposit the checks. Later, usually on Saturday mornings, he would withdraw cash from his accounts. He would put the cash into envelopes with the crew leaders’ names on them. The crew leaders would pick them up, usually at the Boost Mobile store.
Between October 2012 and June 2014, checks totaling about $13.2 million were deposited into Torres’ accounts at Bank of America and Wells Fargo.
Upon conviction, the crimes carry the following penalties:
- Conspiracy to harbor undocumented workers: A maximum penalty of five years and a fine up to $250,000.
- Harboring undocumented workers: A maximum penalty of five years and a fine up to $250,000 on each count.
- Conspiracy to commit money laundering: A maximum penalty of five years and a fine up to $250,000 on each count.
- Money laundering: A maximum penalty of 20 years and a fine up to $500,000 on each count.
- Conspiracy to commit bank fraud: A maximum penalty of five years and a fine up to $250,000 on each count.
- Bank fraud: A maximum penalty of 30 years and a fine up to $1 million on each count.
Homeland Security Investigations (HSI) and the Internal Revenue Service – Criminal Investigation investigated. Assistant U.S. Attorney Jabari Wamble and Assistant U.S. Attorney Brent Anderson are prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
Indictment: Kansas City, Kan., Woman Prepared False Tax ReturnsRead the Press Release
KANSAS CITY, KAN. – A Kansas City, Kan., woman has been indicted on charges of preparing false federal income tax returns, U.S. Attorney Barry Grissom said today.
Prayshana Washington, 27, Kansas City, Kan., was indicted Thursday in U.S. District Court in Kansas City, Kan., on 21 counts of aiding and assisting in the preparation of federal income tax returns containing false information.
The indictment cites tax returns filed for 15 individuals for tax years 2011 and 2012 containing false information on wages, dependents, and education credits and American Opportunity Credits that help pay college expenses. The Internal Revenue Service – Criminal Investigation investigated. Assistant U.S. Attorney Scott Rask and Matthew Kluge, Trial Attorney with the U.S. Department of Justice, Tax Division, are prosecuting.
OTHER INDICTMENTS
Charles Leonhardt Haupt, 31, La Cygne, Kan., was indicted Thursday on one count of conspiracy to distribute methamphetamine, one count of unlawful possession of a firearm in furtherance of drug trafficking, and two counts of unlawful possession of a firearm following a felony conviction. The crimes are alleged to have occurred in February and March 2015 in Linn County, Kan.
If convicted, he faces a penalty of not less than 10 years in federal prison and a fine up to $10 million on the methamphetamine charge, not less than five years (consecutive to other sentences) and a fine up to $250,000 on the charge of possessing a firearm in furtherance of drug trafficking, and a maximum penalty of 10 years and a fine up to $250,000 on each of the other two counts. The Kansas Bureau of Investigation and the FBI investigated. Assistant U.S. Attorney Sheri McCracken is prosecuting.
Jonathan Luis Martin, 30, of Franklin County, Kan., and Charles Bradley Grissom, 26, of Franklin County, Kan., are charged in a superseding indictment with one count of unlawful possession of a pipe bomb. In addition, Martin is charged with one count of unlawful possession of a sawed off shotgun and one count of unlawful possession of a firearm following a felony conviction. In addition, Grissom is charged with one additional count of unlawfully making a pipe bomb and one count of unlawful possession of a destructive device (pipe bomb) after a felony conviction. The crimes are alleged to have occurred in August and December 2014 in Franklin County, Kan.
If convicted, they face a maximum penalty of 10 years in federal prison and a fine up to $250,000 on each count. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Sheri McCracken is prosecuting.
In a separate superseding indictment, Charles Bradley Grissom, 26, of Franklin County, Kan., is charged with one count of distributing methamphetamine, one count of unlawfully possessing firearms in furtherance of drug trafficking, one count of unlawfully possessing a firearm while he was a user on methamphetamine, and one count of unlawful possession of a firearm following a felony conviction. The crimes are alleged to have occurred in May and August 2014 in Franklin County, Kan.
If convicted, he faces a maximum penalty of 20 years in federal prison and a fine up to $1 million on the methamphetamine charge, not less than five years and a fine up to $250,000 on the charge of unlawful possession of firearms in furtherance of drug trafficking, and a maximum penalty of 10 years and a fine up to $250,000 on each of the other counts. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Sheri McCracken is prosecuting.
Petsami Phommaseng, 34, Lawrence, Kan., is charged in a superseding indictment with two counts of unlawful possession of a firearm in furtherance of drug trafficking and two counts of unlawful possession of a firearm by a user of methamphetamine. Co-defendant Susan Khampannha, Lawrence, Kan., is charged with unlawfully allowing a residence in the 2500 block of Ousdahl Road in Lawrence to be used for distributing methamphetamine. The crimes are alleged to have occurred in 2014 and 2015 in Lawrence.
Upon conviction, the crimes carry the following penalties:
Unlawful possession of a firearm in furtherance of drug trafficking: Not less than five years in federal prison and a fine up to $250,000.
Unlawful possession of a firearm by a user of methamphetamine: A maximum penalty of 10 years and a fine up to $250,000.
Maintaining a residence in furtherance of drug trafficking: A maximum penalty of 20 years and a fine up to $250,000.
The Kansas Bureau of Investigation investigated. Assistant U.S. Attorney Sheri McCracken is prosecuting.
Adam Davis, 39, Parsons, Kan., is charged with one count of unlawful possession of a firearm following a felony conviction. The crime is alleged to have occurred July 24, 2014, in Parsons, Kan.
If convicted, he faces a maximum penalty of 10 years in federal prison and a fine up to $250,000. The U.S. Marshals Service investigated. Assistant U.S. Attorney Scott Rask is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
Indianapolis tax preparer indicted for fraudulent returnsRead the Press Release
INDIANAPOLIS – United States Attorney Josh J. Minkler announced the indictment of a former Indianapolis resident for preparing and assisting in filing fraudulent tax returns. Doris Brown, 48, was indicted before a federal grand jury this week.
Brown operated a business called “Get Money Taxes” on the Eastside of Indianapolis where she prepared and filed clients’ tax returns, something she had been doing for over 20 years. The indictment alleges that in 2010, she prepared and filed a false federal income tax return that artificially inflated her client’s refund – causing the IRS to refund the taxpayer more than what she was actually owed. Brown is alleged to have accomplished this by exploiting the Earned Income Tax Credit, a federal tax credit designed to assist working low-to-middle income families. To inflate her client’s refund, Brown is alleged to have included false “business income” and “dependent” information on her client’s return.
Specifically, the indictment alleges that Brown purchased a child’s information from someone in the community, including name and Social Security number, for use as a “dependent” on a tax return. Brown then allegedly used the child’s information in preparing and filing the client’s tax return in 2010, knowing that the client had no relation to the child and could not claim the child as a dependent.
Additionally, the indictment alleges that Brown used the same child as a “dependent” on her own taxes that she filed in 2011, knowing that she had no relation to the child and could not claim the child as a dependent.
The IRS Criminal Investigation Division is committed to ensuring that all taxpayers pay their fair share,” said Stephen Boyd, Acting Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago. “We are aggressively serving the American people by investigating criminal violations of the Internal Revenue Code. Tax fraud does not know a season – IRS Special Agents pursue criminals year round, not only at tax time. Taxpayers who might be thinking about cheating with the filing deadline looming should think twice or they will risk the consequences.”
According to Assistant United States Attorney Nicholas Linder, who is prosecuting the case, Brown could face up to six years if convicted on all counts.
An indictment is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
Hanover Postal Carrier Pleads Guilty to Destruction of MailRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that Stacie Ann Stevens, age 41, of Hanover, Pennsylvania was charged with destruction of mail in a criminal information filed in U.S. District Court in Harrisburg and pled guilty before Senior United States District Court Judge William C. Caldwell on March 19, 2015.
According to U.S. Attorney Peter Smith, between July and October, 2014, Stevens, a postal carrier, began opening greeting cards and other mail and stealing the cash and gift cards contained inside. The theft was discovered after residents complained about missing or torn mail. In October 2014, Stevens was caught on surveillance video using one of the stolen gift cards at a local store. If convicted, Stevens faces one year imprisonment and a fine of up to $100,000.
Stevens has resigned from the Postal Service. The Government has filed a plea agreement with the defendant which is subject to approval of the court. As part of the agreement, Stevens agreed to pay restitution to the victims.
This case is being investigated by the United States Postal Service, Office of Inspector General and the Carroll Valley Borough Police Department and is being prosecuted by Assistant United States Attorney Daryl F. Bloom.
Anyone who believes they may be a victim or who has further information should contact Special Agent Michael Brennan, United States Postal Service, Office of Inspector General at 717-395-9515.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
Greenbrier Village Settles Lawsuit Alleging Unlawful Discrimination Against Families with Children in Violation of Fair Housing ActRead the Press Release
The Department of Justice today announced a settlement agreement between the United States, the Greenbrier Village Homeowner’s Association Inc. (Greenbrier), Gassen Company Inc. (Gassen) and an individual Gassen employee to resolve a lawsuit filed on Nov. 25, 2013. The lawsuit alleged that Greenbrier and Gassen unlawfully discriminated against residents with children by issuing and enforcing rules regarding the use of common areas at the Condominiums of Greenbrier Village. The settlement includes a commitment from Greenbrier to establish a new non-discrimination policy in accordance with the Fair Housing Act, pay a $10,000 penalty to the United States and pay $100,000 to six families that suffered as a result of the discrimination.
“The Fair Housing Act prohibits housing providers from discriminating against families with children,” said Acting Assistant Attorney General Vanita Gupta of the Civil Rights Division. “This means more than just allowing those families to live at the property. It means giving these families fair access to the common areas and amenities.”
“Housing discrimination has no place in Minnesota,” said U.S. Attorney Andrew M. Luger of the District of Minnesota. “This case reaffirms the long-held principle of our civil rights laws that families come in all shapes and sizes. Arbitrary rules that restrict the rights of children to enjoy the places where they live are not acceptable.”
“Families with children have the right to live in condos that don’t meet federal requirements to qualify as housing for older persons,” said HUD Assistant Secretary Gustavo Velasquez for Fair Housing and Equal Opportunity. “HUD is sending a clear message to homeowners associations and management companies that they must comply with the Fair Housing Act.”
According to the settlement agreement and documents filed in court, Greenbrier and Gassen allegedly engaged in a pattern of discrimination by creating and enforcing rules in a manner that prevented children from equal enjoyment of common areas and making statements that indicated a preference against families with children. The United States alleged that the defendants required children to be supervised at all times when in a common area, prohibited or unreasonably restricted children from using the common areas and selectively enforced the common area rules by issuing warnings and violation notices to residents with children, but not to adult residents engaging in the same activities.
According to the settlement agreement, at least six families suffered as a result of Greenbrier and Gassen’s alleged discrimination. Greenbrier agreed to a financial settlement with each of the families, totaling $100,000. Greenbrier will also adopt and implement a new anti-discrimination policy, its board members and staff will undergo training on the Fair Housing Act, with a specific emphasis on discrimination on the basis of familial status, and Greenbrier will pay a civil penalty to the United States.
Attorneys from the Civil Rights Division and Assistant U.S. Attorneys Bahram Samie and Ana Voss of the District of Minnesota handled this matter for the United States.
U.S. Attorney Luger thanked HUD’s Office of Fair Housing and Equal Opportunity for assisting in the investigation.
Greenbrier Village Settles Law Suit Alleging Unlawful Discrimination Against Families with Children in Violation of Fair Housing ActRead the Press Release
United States Attorney Andrew M. Luger today announced a settlement agreement between the United States, the Greenbrier Village Homeowner’s Association, Inc. (Greenbrier), and Gassen Company, Inc. (Gassen) and an individual Gassen employee to resolve a lawsuit filed on November 25, 2013. The lawsuit alleged that Greenbrier and Gassen unlawfully discriminated against residents with children by issuing and enforcing rules regarding the use of common areas at the Condominiums of Greenbrier Village. The settlement includes a commitment from Greenbrier to establish a new non-discrimination policy in accordance with the Fair Housing Act, pay a $10,000 penalty to the United States and pay $100,000 to six families that suffered as a result of the discrimination.
“Housing discrimination has no place in Minnesota,” said United States Attorney Andrew M. Luger. “This case reaffirms the long-held principle of our civil rights laws that families come in all shapes and sizes. Arbitrary rules that restrict the rights of children to enjoy the places where they live are not acceptable.”
“The Fair Housing Act prohibits housing providers from discriminating against families with children. This means more than just allowing those families to live at the property. It means giving these families fair access to the common areas and amenities,” said Acting Assistant Attorney General Vanita Gupta of the Civil Rights Division.
“Families with children have the right to live in condos that don’t meet federal requirements to qualify as housing for older persons,” said Gustavo Velasquez, HUD Assistant Secretary for Fair Housing and Equal Opportunity. “HUD is sending a clear message to homeowners associations and management companies that they must comply with the Fair Housing Act.”
According to the settlement agreement and documents filed in court, Greenbrier and Gassen allegedly engaged in a pattern of discrimination by creating and enforcing rules in a manner that prevented children from equal enjoyment of common areas and making statements that indicated a preference against families with children. The United States alleged that the defendants required children to be supervised at all times when in a common area, prohibited or unreasonably restricted children from using the common areas and selectively enforced the common area rules by issuing warnings and violation notices to residents with children, but not to adult residents engaging in the same activities.
According to the settlement agreement, at least six families suffered as a result of Greenbrier and Gassen’s alleged discrimination. Greenbrier agreed to a financial settlement with each of the families, totaling $100,000. Greenbrier will also adopt and implement a new anti-discrimination policy, its board members and staff will undergo training on the Fair Housing Act, with a specific emphasis on discrimination on the basis of familial status, and Greenbrier will pay a civil penalty to the United States.
Assistant U.S. Attorneys Bahram Samie and Ana Voss and attorneys from the Department of Justice Civil Rights Division handled this matter for the United States.
U.S. Attorney Luger thanked the Office of Fair Housing and Equal Opportunity at the United States Department of Housing and Urban Development for assisting in the investigation.Greenbrier Consent Order
Garland Man Sentenced to 96 Months in Federal Prison on Child Pornography ConvictionRead the Press Release
DALLAS — A Garland, Texas, man, Jonathan Ramirez, 26, was sentenced this week by U.S. District Judge Ed Kinkeade to 96 months in federal prison, following his guilty plea in November 2014 to one count of receipt of child pornography, announced John Parker, Acting U.S. Attorney for the Northern District of Texas.
According to documents filed in the case, in June 2014, a Task Force Officer with the FBI, working online in an undercover capacity investigating the distribution of child pornography and the sexual exploitation of children, learned that a specific IP address, later linked to Ramirez, had made 78 files of child pornography available for sharing. Based in part on that discovery, the following month, law enforcement with the FBI Dallas Child Exploitation Task Force and the Garland Police Department executed a federal search warrant at Ramirez’s home. Agents seized an external hard drive and other media belonging to Ramirez. A review of the evidence revealed that the hard drive contained several child pornography videos.
Ramirez admitting using ARES P2P file sharing network to view and download images and videos of child pornography that he would then move to an external hard drive. He admitted that he had more than 175 videos and 50 images of child pornography on his computer and external hard drive.
The matter was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
The FBI’s Dallas Child Exploitation Task Force and the Garland Police Department investigated. Assistant U.S. Attorney Camille Sparks prosecuted.
Gang Leader Sentenced to 151 Months in Prison for Selling HeroinRead the Press Release
CAMDEN, N.J. – An admitted leader of the “Fruit Town Brims” set of the Bloods street gang was sentenced today to 151 months in prison for dealing heroin, U.S. Attorney Paul J. Fishman announced.
Tyrone Tyson Sr., 40, of Camden, pleaded guilty in October 2014 before U.S. District Judge Joseph E. Irenas to an information charging him with distributing and possession with intent to distribute 100 grams or more of heroin. Judge Irenas imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
Tyson controlled the activities of the “Fruit Town Brims” set of the Bloods in Camden. He was released in August 2013 from a 21-year state prison term for first-degree aggravated manslaughter and second-degree aggravated assault for shooting two people seated inside of a car and killing one of them. He began selling heroin in the area of North 32nd Street in Camden and sold heroin to an undercover agent twice in September 2013, just one month after being released from prison. Tyson’s criminal history also includes convictions for possession of controlled dangerous substances, second-degree aggravated assault, third-degree aggravated assault, conspiracy to distribute controlled dangerous substances, and possessing an electronic communication device in a correctional facility.
In late July 2013, members of the Camden High Intensity Drug Trafficking Area (HIDTA) Task Force conducted an investigation into Tyson’s drug trafficking activities, using surveillance, undercover officers, confidential informants, audio recordings and controlled drug purchases. The investigation revealed Tyson was selling heroin in the area of North 32nd Street in Camden and, in fact, sold heroin to an undercover law enforcement agent on two occasions.
In addition to the prison term, Judge Irenas sentenced Tyson to five years of supervised release.
U.S. Attorney Fishman credited special agents of the N.J. Drug Enforcement Administration, under the direction of Special Agent in Charge Carl J. Kotowski; Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Acting Special Agent in Charge Kevin Kelly; the Camden County Prosecutor’s Office, under the direction of Prosecutor Mary Eva Colalillo; the Gloucester County Prosecutor’s Office, under the direction of Prosecutor Sean F. Dalton; and the Burlington County Prosecutor’s Office, under the direction of Prosecutor Robert D. Bernardi, with the investigation leading to today’s sentencing.He also thanked officers of the Camden County Sheriff’s Department, the Delaware River Port Authority Police, the Gloucester City Police Department, the Westampton New Jersey Police Department, the Monroe Township Police Department and the Washington Township Police Department for taking part in the investigation.
The government is represented by Special Assistant U.S. Attorney Erin M. Fay of the Camden office.This case was developed through the work of the Camden Collaborative Crime Commission (C-4). Every federal, state and local law enforcement agency and prosecutor’s office responsible for combating drug trafficking, gang activity and violent crime in Camden has come together in one location to share intelligence, develop investigative strategies and support the investigative and prosecutorial efforts of its partners. C-4 has merged the individual missions of the various law enforcement agencies into a single strategic attack on drug trafficking and drug-related violent crime. Such intense coordination greatly enhances the law enforcement community’s ability to correctly identify and successfully prosecute the most dangerous criminals in one of our nation’s most dangerous cities.
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Defense Counsel: Scott Cohen Esq., Cherry Hill, N.J.
Four sentenced on drug trafficking chargesRead the Press Release
CLARKSBURG, WEST VIRGINIA – Four individuals were sentenced in federal court in Clarksburg today on drug trafficking charges, United States Attorney William J. Ihlenfeld, II, announced.
Natasha Nicole Selmon, 34, of Shinnston, West Virginia, Jessica Earnest, 32, of Mount Clare, West Virginia, and Stephanie Michelle Furner, 35, of Salem, West Virginia, were each involved in the distribution of bath salts known as “Power X Energy Soak.” The bath salts contained a controlled substance known as “α-Pyrrolidinovalerophenone” or “α-PVP.”
Selmon and Earnest each pled guilty in November 2014 to one count of “Possession with Intent to Distribute Controlled Substance Analogue – Aiding and Abetting” Selmon was sentenced today to 18 months in prison with credit for time served since February 2015. Earnest was sentenced today to 6 months in prison.
Furner pled guilty in November 2014 to one count of “Distribution of Controlled Substance Analogue – Aiding and Abetting.” She was sentenced today to 5 months in prison.
Eric Holt, 44, of Lumberport, West Virginia, was sentenced today to three years of probation for selling crack cocaine in Harrison County, West Virginia. He pled guilty in November 2014 to one count of “Distribution of Cocaine Base - Aiding and Abetting.” Holt will serve the first four months of his probation on home detention.
Assistant U.S. Attorney Shawn Morgan prosecuted the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Greater Harrison County Drug and Violent Crime Task Force, a HIDTA-funded initiative, investigated.
U.S. District Judge Irene M. Keeley presided.
Four Shelby County Jailers Indicted for Attempting to Smuggle Narcotics into the Shelby County JailRead the Press Release
Memphis, TN – Four Shelby County jailers were arrested late yesterday and early this morning on federal charges of attempting to smuggle OxyContin into the Shelby County Jail to provide to inmates.
The four defendants are named in federal indictments returned yesterday. The indictments allege attempted possession with the intent to distribute OxyContin, a schedule II controlled substance.
“As the indictments allege, these defendants participated in a scheme to accept bribes from inmates in exchange for violating the very laws they swore to uphold,” stated United States Attorney Edward Stanton III. “These individuals falsely believed that they were above the law, and now they are facing prison time behind the bars they once were responsible for guarding.”
Those named in the indictments are:
Anthony Thomas, 27, of Memphis, TN;
Marcus Green, 33, of Covington, TN;
Brian Grammer, 35, of Memphis, TN; and
Torriano Vaughn, 28, of Cordova, TN.The indictments allege that the defendants devised a scheme to smuggle OxyContin, a schedule II controlled substance, into the Shelby County Jail located at 201 Poplar, Memphis, TN. The defendants would allegedly contact inmates and offer to smuggle illegal drugs into the Shelby County Jail for a predetermined amount of money. The defendants would then meet a third party affiliated with the inmate at a location within the Memphis metropolitan area. The third party would give the defendants what they believed was OxyContin and the defendants would accept the money in return. The contraband would then be smuggled into the Shelby County Jail and given to inmates.
“Over a year ago we began a long term investigation regarding drugs being smuggled into our jail,” said Shelby County Sheriff Bill Oldham. “I want to thank the Tarnished Badge Task Force for their hard work. Special Agent Todd McCall for his support, U.S. Attorney Edward Stanton and in particular Assistant U.S. Attorney Brian Coleman for his guidance and counsel with this investigation. Also, Attorney General Amy Weirich for her assistance in this investigation as well. This activity will not be tolerated. The Sheriff’s Office will attack this with all of the resources available to us. Finally, to the other employees willing to violate their oath and put jailers at risk we will get you and prosecute you to the fullest extent of the law.”
“Public corruption is the number one criminal priority of the FBI, and we will always work tirelessly with our law enforcement partners to root out those in a position of public trust who violate the law to line their own pockets,” said A. Todd McCall, Special Agent in Charge of the Memphis Division of the Federal Bureau of Investigation. “These indictments send the message that the bad acts of a small few will not be allowed to continue and impugn the reputation of those who honorably serve the public day-in and day-out.”
The four defendants’ initial appearances will be held today. If they are convicted, they each would face a statutory maximum sentence of 20 years in federal prison.
This case was investigated by the Tarnished Badge Task Force, which is comprised of investigators from the Shelby County Sheriff’s Office, Memphis Police Department and Federal Bureau of Investigation. The government’s case is being prosecuted by Assistant U.S. Attorney Brian K. Coleman.
The charges and allegations contained in indictments are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Four Convicted in $1.6 Million Luxury Automobile Loan Fraud SchemeRead the Press Release
CHICAGO — Three Chicago-area defendants, and a fourth defendant from Decatur, Ga., were convicted of federal bank fraud charges for engaging in a scheme to fraudulently obtain 51 luxury automobile loans totaling approximately $1.6 million without ever intending that the borrowers would purchase the high-end cars that they claimed to be buying. As a result, various credit union lenders, including Credit Union 1, Great Lakes Credit Union, Navy Federal Credit Union, Pentagon Federal Credit Union, and Sherwin-Williams Credit Union, incurred losses totaling at least $853,000. Two of the four charged defendants were convicted today by a jury in U.S. District Court Andrea R. Wood’s courtroom. Two additional defendants involved in the scheme pled guilty before trial.
The two men convicted at trial yesterday were PRECIOUS W. HOUSE, 47, of Chicago, the president of Rolling Auto, Inc. of Plymouth, Ind., and XPress Automotives of Chicago, two wholesale auto dealerships that purported to be selling many of the autos. HOUSE was convicted of five counts of bank fraud. Also convicted at trial was BRIAN K. HUGHES, 41, of Homewood, the president of Hughes Corporate Consulting. HUGHES was convicted of four counts of bank fraud and one count of making false statements on a loan application. The defendants’ sentencings were set for June 2015.
Two remaining defendants pled guilty: KEITH B. FOSTER, 46, of Harvey, pled in October 2014 to one count of making false statements on a loan application. FOSTER was sentenced to 12 months imprisonment and has been ordered to surrender April 6, 2015. CRYSTAL WILLIAMS, 31, of Decatur, Georgia, pled guilty in September 2014 to one count of bank fraud and will be sentenced at a later date.
According to court records, between February and November 2013, defendants HOUSE and HUGHES recruited individuals seeking loans and agreed to find loans for them in exchange for a fee of 20 to 30 percent of the loan. The defendants obtained at least 36 automobile loans of the 51 total sought on behalf of the applicants, and the defendants fraudulently obtained approximately $1.12 million of the total $1.6 million for which they applied.
In order to obtain the loans, the defendants made, and caused the loan applicants to make, false representations in documents such as loan applications, vehicle purchase orders, and verifications of employment. The false statements concerned the applicants’ income, employment, credit history, intent to use the loan proceeds to purchase automobiles, and the existence of contracts obligating the borrowers to purchase vehicles from defendant HOUSE and his companies, Rolling Auto and XPress Automotives. The purchase orders falsely represented that the loan applicants had contracts to purchase from HOUSE’s dealership various luxury autos made by BMW, Chevrolet, Jaguar, Lexus, Mercedes-Benz, Nissan, and Porsche. If the individual applicants refused to cash checks obtained as part of the scheme, defendant HUGHES threatened them with civil lawsuits and criminal prosecutions. Defendant HOUSE then deposited the loan proceeds into bank accounts he controlled in Illinois, California, and Georgia.
The indictment was previously announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois, and Robert J. Holley, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.
The Government was represented by Assistant U.S. Attorneys Christopher R. McFadden and Sunil Harjani.
Each count of bank fraud and making false statements on loan applications carries a maximum penalty of 30 years in prison and a $1 million fine, and restitution is mandatory. The Court may impose an alternate fine totaling twice the loss to any victim or twice the gain to the defendant, whichever is greater. The Court must impose a reasonable sentence under federal sentencing statutes and the advisory United States Sentencing Guidelines.
Former U.K. Rabobank Trader Appears in U.S. Court to Face LIBOR Interest Rate Manipulation ChargesRead the Press Release
The former global head of liquidity and finance for Coöperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank) has waived extradition and appeared in U.S. federal court today for an arraignment on charges related to his alleged role in a scheme to manipulate the U.S. Dollar (USD) and Yen London InterBank Offered Rate (LIBOR), a benchmark interest rate.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Assistant Attorney General Bill Baer of the Justice Department’s Antitrust Division and Assistant Director in Charge Andrew G. McCabe of the FBI’s Washington Field Office made the announcement.
Anthony Allen, 43, of Hertsfordshire, England, appeared in the Southern District of New York and pleaded not guilty to a superseding indictment charging him with conspiracy to commit wire and bank fraud and substantive counts of wire fraud. The court released Allen on a $500,000 bond and set a trial date for Oct. 5, 2015.
According to the superseding indictment, at the time relevant to the charges, LIBOR was an average interest rate, calculated based on submissions from leading banks around the world, reflecting the rates those banks believed they would be charged if borrowing from other banks. It serves as the primary benchmark for short-term interest rates globally and is used as a reference rate for many interest rate contracts, mortgages, credit cards, student loans and other consumer lending products. LIBOR was published by the British Bankers’ Association (BBA), a trade association based in London. LIBOR was calculated for 10 currencies at 15 borrowing periods, known as maturities, ranging from overnight to one year. The published LIBOR “fix” for U.S. Dollar and Yen currency for a specific maturity was the result of a calculation based upon submissions from a panel of 16 banks, including Rabobank.
According to allegations in the superseding indictment, Allen, who was Rabobank’s Global Head of Liquidity & Finance and the manager of the company’s money market desk in London, put in place a system in which Rabobank employees who traded in derivative products linked to USD and Yen LIBOR regularly communicated their trading positions to Rabobank’s LIBOR submitters, who submitted Rabobank’s LIBOR contributions to the BBA. Rabobank traders entered into derivative contracts containing USD or Yen LIBOR as a price component and they allegedly asked others at Rabobank to submit LIBOR contributions consistent with the traders’ or the bank’s financial interests, to benefit the traders’ or the banks’ trading positions.
The charges in the superseding indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
The investigation is being conducted by special agents, forensic accountants and intelligence analysts in the FBI’s Washington Field Office. The prosecution is being handled by the Criminal Division’s Fraud Section and the Antitrust Division. The Criminal Division’s Office of International Affairs has provided assistance in this matter.
The Justice Department expresses its appreciation for the assistance provided by various enforcement agencies in the United States and abroad. The Commodity Futures Trading Commission’s Division of Enforcement referred this matter to the department and, along with the U.K. Financial Conduct Authority, has played a major role in the investigation. The Securities and Exchange Commission also has played a significant role in the LIBOR series of investigations, and the department expresses its appreciation to the United Kingdom’s Serious Fraud Office for its assistance and ongoing cooperation. The department has worked closely with the Dutch Public Prosecution Service and the Dutch Central Bank in the investigation of conduct at Rabobank. Various agencies and enforcement authorities from other nations are also participating in different aspects of the broader investigation relating to LIBOR and other benchmark rates, and the department is grateful for their cooperation and assistance.
Former SSA Employee Sentenced to 21 Months in Federal Prison for Role in Conspiracy to Defraud the SSARead the Press Release
DALLAS — A former employee of the Social Security Administration (SSA) was sentenced this morning for his role in a conspiracy to defraud the SSA, announced John Parker, Acting U.S. Attorney for the Northern District of Texas.
Carwin Shaw, 33, of Arlington, Texas, was sentenced to 21 months in federal prison and ordered to pay $78,165 in restitution. He pleaded guilty in December 2014 to one count of conspiracy to commit theft of government funds. He must surrender to the Bureau of Prisons on April 28, 2015.
Shaw, along with co-defendants Amanda Johnson, 35, April Harvey, 36, and Lanusha Lemmons, 25, all of Arlington, were each indicted in May 2014 on one count of conspiracy to defraud the U.S. and one count of theft of government funds. Lemmons pleaded guilty to her role and was sentenced earlier this month to a two-year term of probation. A trial date of April 27, 2015, is set for defendants Johnson and Harvey.
According to documents filed in the case, Shaw, who worked as a Service Representative in the SSA’s Mid-Cities Field Office, located in Grand Prairie, Texas, had access to the SSA’s electronic databases. He admitted that he made agreements with co-conspirators to illegally obtain SSA funds by manipulating SSA’s electronic databases to achieve multiple objectives.
In some instances, for example, he manipulated the verified income attributed to Supplemental Security Income beneficiaries that resulted in the issuance of larger payments than authorized, the issuance of payments when none were due, and the removal of legitimate overpayments posted to beneficiary’s record. Shaw further admitted using the SSA’s electronic systems that interface with the U.S. Treasury Department to issue duplicate checks to beneficiaries when only one check was due. Shaw would cut additional checks to the co-conspirators by alleging their initial check had been lost or stolen, split the second check with the co-conspirator and then access the system and waive the overpayment so that it would not be recovered from any future benefits. Each co-conspirator was the representative payee for one minor or otherwise incompetent Social Security beneficiary.
The loss to the SSA as a result of all of Shaw’s relevant conduct is approximately $78,165.
The case was investigated by the SSA’s Office of the Inspector General. The case is being prosecuted by Special Assistant U.S. Attorney Nicole Dana.
Former Lafayette County Treasurer/tax Collector Sentenced to 24 Months for Embezzlement of Public FundsRead the Press Release
Texarkana, Arkansas - Conner Eldridge, United States Attorney for the Western District of Arkansas, announced that Keesha Rose, age 37, of Lewisville, Arkansas, was sentenced today to 24 months in prison followed by three years of supervised release on one count of Theft Concerning Programs Receiving Federal Funds. Rose served as the County Treasurer and Tax Collector for Lafayette County. She was also ordered to pay restitution in the amount of $282,036.97. The Honorable Harry F. Barnes presided over the sentencing hearing in the United States District Court in Texarkana.
U. S. Attorney Eldridge stated, “The conduct by this public official is shameful and a disgrace to all other public officials who are dedicated to the service to which they have been elected; such an abuse of public trust is offensive to other honest elected officers that are loyal to their positions. We remain committed to investigating and prosecuting those who embezzle public funds throughout the Western District of Arkansas.”
“Arkansas deserves and is blessed with so many public servants who do the right things for the right reasons. However, corrupt public officials erode the trust necessary for our democracy to function,” stated Special Agent in Charge David T. Resch with the Little Rock FBI, “We appreciate our partnership with the United States Attorney’s Office and the Arkansas State Police as we continue to confront public corruption as a top priority in Arkansas.”
According to court records, Keesha Rose was elected as Treasurer and Tax Collector for Lafayette County, Arkansas in November, 2010 and was responsible for collection and administration of all funds collected and disbursed on behalf of Lafayette County. Lafayette County received benefits in excess of $10,000 under a Federal program for the both 2011 and 2012. On May 31, 2013, The Arkansas Division of Legislative Audit reported that a comparison of cash receipts to cash bank deposits revealed that $162,275.00 was not deposited in the county’s bank accounts by Rose for a period of January 1, 2011 through September 20, 2012. The auditors noted numerous issues with accounting processes and recordkeeping that were consistent with the embezzlement of funds. In addition to the $162,275.00, auditors determined that for the time period between September 20, 2012 and November 7, 2013, an additional $81,618 in public funds was embezzled by Rose, bringing the total amount known prior Ms. Rose’s change of plea to $243,893.00. Rose pleaded guilty to the charge on October 29, 2014. Subsequent to Ms. Rose’s change of plea, auditors determined that for the time period between November 7, 2013 and April 30, 2014, and additional $38,143.97 in public funds was also embezzled, bringing the total amount of embezzled funds to $282,036.97.
This case was investigated by the Federal Bureau of Investigation and the Arkansas State Police. Assistant U. S. Attorney Jonathan Ross prosecuted the case for the United States.
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Related court documents may be found on Public Access to Electronic Records [email protected]
Former HPD Officer Ordered to Prison for Drug Conspiracy ConvictionRead the Press Release
HOUSTON - Former Houston Police Department (HPD) officer Marcos E. Carrion has been ordered to federal prison for his role in a drug conspiracy, announced U.S. Attorney Kenneth Magidson. Carrion entered a guilty plea to the charge Thursday, Oct. 9, 2014.
Today, U.S. District Judge Sim Lake, who accepted the plea, handed Carrion a total sentence of 70 months in federal prison to be immediately followed by five years of supervised release. In handing down the sentence, Judge Lake noted that Carrion violated a position of trust by agreeing to escort cocaine loads in the city.
On April 16, 2014, a Houston grand jury returned a sealed indictment charging Carrion with conspiring with others to possess with the intent to distribute five or more kilograms of cocaine from mid-2013 through April 2014. Carrion, 37, a five-year HPD veteran, had been assigned to the Southwest Patrol Division prior to resigning from his position.
As part of his plea agreement, Carrion admitted to providing security for a narcotics transaction which involved 10 kilograms of cocaine. During negotiations, Carrion stated he was an HPD officer and that he “had a lot to lose,” but ultimately agreed to providing security in exchange for $2,500. After being paid, Carrion falsely claimed another officer was present and demanded another $2,500.
Carrion also agreed to provide security for future transactions which were to involve 20-30 kilogram loads of cocaine. He claimed he could arrange for additional uniformed officers to assist whom he would pay and instruct to just show up, not ask questions and do what he said.
Carrion was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.The Drug Enforcement Administration, Houston Police Department and FBI investigated. Assistant U.S. Attorneys Mark E. Donnelly and Shelley J. Hicks are prosecuting the case.
Former FBI Agent Charged with Obstructing Justice, Falsifying Records and Possessing HeroinRead the Press Release
A Maryland man was charged today in the District of Columbia with crimes arising out of his tampering with substantial quantities of drug evidence while working as a Special Agent with the Federal Bureau of Investigation (FBI), announced U.S. Attorney Zane David Memeger of the Eastern District of Pennsylvania. The 64-count information charges Matthew Lowry with 20 counts of obstruction of justice, 18 counts of falsification of records, 13 counts of conversion of property, and 13 counts of possession of heroin.
Matthew Lowry, 33, of Upper Marlboro, Maryland, was assigned to the Washington, D.C. Field Office (WFO), and was a member of the Cross-Border Task Force (CBTF). As a member of the CBTF, the defendant participated in several large-scale investigations that resulted in numerous seizures of significant quantities of narcotics, including heroin. According to the information, in 2013 and 2014, the defendant tampered with heroin evidence seized during several of his investigations. As those investigations occurred within the District of Columbia and the districts surrounding it, those offices have been recused by the Department of Justice, and the prosecution is being conducted by the U.S. Attorney’s Office of the Eastern District of Pennsylvania.
In several instances, it is alleged that the defendant went to the WFO’s Evidence Control Center (ECC) and removed seized heroin from evidence, writing on a chain of custody record a false explanation for his taking of the evidence. The information alleges that over a period of several weeks or months, the defendant kept the heroin in his car and periodically ingested it. Before returning the heroin to the ECC or bringing it to a laboratory for testing, the defendant allegedly added to the heroin a measured amount of a cutting agent, either the supplement Creatine or the laxative Purelax, in order to account for the weight discrepancy resulting from his illegal usage; placed the altered heroin into a new evidence bag, on which he placed a new sticker signifying that the evidence bag had been sealed; copied the content written on the original sealing sticker to the new sealing sticker, forging the names or signatures of FBI agents who purportedly witnessed his sealing of the evidence; peeled off a barcode sticker from the original evidence bag and applied it to the new bag; and disposed of the original evidence bag and sealing sticker.
The defendant also participated in many undercover, controlled purchases of heroin from targets in his investigations. Following several of these transactions, the defendant, rather than check the heroin into evidence as required, is alleged to have kept the heroin in his car for a period of several weeks or months, during which he periodically ingested it. Before checking the heroin into the ECC, it is alleged that the defendant added a cutting agent to account for the weight discrepancy resulting from his ingesting the heroin; placed sealing stickers on evidence bags and filled out all requested information except for the seizure and sealing dates, which he left blank; requested that another agent, who had no knowledge of the defendant’s improper motives, sign as the witnessing official the undated sealing stickers; and wrote on the sealing stickers the accurate date on which the drugs were seized but falsely indicated that the evidence was sealed that same day.
Additionally, on one occasion, the defendant participated in an undercover, controlled purchase of heroin from a target, and in lieu of turning the heroin into evidence and documenting its seizure, the defendant allegedly ingested the heroin and never turned it into evidence.
The FBI referred this matter to the Department of Justice Office of the Inspector General (DOJ-OIG), which initiated the investigation. The investigation has not identified any criminal conduct by other agents
If convicted, the defendant faces at least 87 months in prison under the advisory guideline range calculated by the government, three years of supervised release, a fine of up to $16 million, and a $6,400 special assessment.
The case was investigated by the DOJ-OIG, with assistance from the FBI as requested by the DOJ-OIG. The case is being prosecuted by Assistant U.S. Attorneys Kevin R. Brenner and Maureen McCartney.
An information is an accusation. A defendant is presumed innocent unless and until proven guilty.
Lowry Information
Former Employee Charged with Embezzling over $2.5 Million from Marietta, Ga., Hair Products CompanyRead the Press Release
ATLANTA - Veria Fields, a former employee of Bronner Bros., Inc., has been arraigned on nine counts of mail fraud relating to theft from her former employer. Fields was indicted by a federal grand jury on March 4, 2015.
“Small businesses depend on their finance and accounting personnel to safeguard the financial health of the company and its employees,” said Acting U.S. Attorney John Horn. “This defendant is charged with violating this trust and helped herself to millions of the company’s dollars over several years.”
J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office, stated: “The loss amount in this case is significant and, with the federal indictment and arrest of Ms. Fields, the former Accounts Receivable Manager at the victim company, this matter will have its day in court.”
According to Acting U.S. Attorney Horn, the charges and other information presented in court: Fields was the Accounts Receivable Manager for Bronner Bros. Inc., a wholesaler of African American hair care products headquartered in Marietta, Georgia, Fields also informally performed customer service functions for the company. From 2006 through 2010, Fields allegedly embezzled over $2.5 million from Bronner Bros. by offering customers unauthorized discounts of five to ten percent in exchange for cash payments made directly to her. Thereafter, customers continued to submit orders with the expectation that they would receive the cash discounts promised by the defendant. To conceal the unauthorized discounts and her theft from Bronner Bros, Fields allegedly used her position as Accounts Receivable Manager to create false and fraudulent accounting entries.
Fields, 54, of Atlanta, Georgia, was arraigned on March 19, 2015, before U.S. Chief Magistrate Judge Janet F. King.Members of the public are reminded that the indictment contains only charges. The defendant is presumed innocent of the charges and it will be the government's burden to prove the defendant's guilt beyond a reasonable doubt at trial.
This case is being investigated by the Federal Bureau of Investigation.
Assistant United States Attorney Bernita B. Malloy is prosecuting the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao/gan/.
Former Defense Contractor Pleads Guilty to Paying Bribes in IraqRead the Press Release
Tampa, FL – United States Attorney A. Lee Bentley, III announces that Ankana Pecault Stovall (47, Riverview) has pleaded guilty to an indictment charging her with conspiracy to pay gratuities and supplement the salary of members of the U.S. military in order to gain favorable contracting treatment in Iraq. She faces a maximum penalty of five years in federal prison. A sentencing date has not yet been set. The indictment also notifies Stovall that the United States is seeking a money judgment in the amount of $19,500.
Two co-conspirators, U.S. Army Master Gunnery Sergeant Timothy Lerone Benton (Virginia) and U.S. Army First Sergeant Richard Allen Smith (Delaware), previously pleaded guilty in federal court in Tampa to accepting gratuities from Stovall during their time in Iraq in exchange for preferential contracting treatment for Stovall and her associated contracting companies.
According to court documents, between June 2007 and October 2009, Stovall was working for a defense contractor in Iraq and operating her own Riverview-based contracting company, Logistics Support and Services Company (“LSS”), which were both doing business with the U.S. military on Camp Liberty in Baghdad. Stovall was involved in a personal and financial relationship with Benton, who used his official position in Iraq to benefit Stovall, LSS, and Stovall’s employer by escorting trucks loaded with furniture, gravel, and other supplies through Camp Liberty to circumvent the required security procedures on the base. For his assistance, Stovall would pay Benton cash. Benton also assisted Stovall and LSS in receiving cash purchase orders for supplies through his unit at Camp Liberty, including two 47-inch LCD televisions for $6,400 and 100 digital cables for $5,500. After Benton returned from Iraq, Stovall used LSS funds to pay for a vacation to the Bahamas for her and Benton. Later that year, she gave Benton a $5,000, no-interest loan. In early 2010, Benton used his official position at the Pentagon to draft two official memoranda sponsoring and endorsing Stovall and LSS to conduct business on Camp Liberty.
In addition to the payments to Benton, Stovall regularly made cash payments in the amount of $3,000 to Smith on behalf of her employer. Smith was the U.S. government employee in charge of the motor pool on Camp Liberty and was responsible for assigning military vehicle maintenance work to contractors. On multiple occasions, Stovall made cash payments to Smith to ensure that her employer would receive favorable treatment and contracts to perform work at the motor pool.
This case was investigated by the Defense Criminal Investigative Service, the United States Army – Criminal Investigation Command, and the Naval Criminal Investigative Service. It is being prosecuted by Assistant United States Attorney Josephine W. Thomas.
Former DeKalb County Commissioner Sentenced for Stealing County FundsRead the Press Release
ATLANTA – Elaine Boyer, former Commissioner of District 1 in DeKalb County, Georgia, has been sentenced for embezzling county funds and misusing her government credit card.
“Elaine Boyer helped herself to over $75,000 in taxpayer funds which were intended to benefit and improve DeKalb County,” said Acting U.S. Attorney John A. Horn. “Instead, she used the money for things like her personal travel and for purchases at high-end department stores. The citizens of DeKalb County deserve to be represented by honest elected officials who put the interests of the public first.”
J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office, stated: “The sentencing of former Dekalb County Commissioner Boyer concludes a lengthy career serving the people of Dekalb County. In spite of her otherwise admirable service to her community, Ms. Boyer lost her way and crossed the line of the law, resulting in the end of her public service career and time in federal prison to reflect on it all.”
According to Acting U.S. Attorney Horn, the charges, and other information presented in court: In DeKalb County, Georgia, the Board of Commissioners (“BOC”) serves as the legislative branch of the DeKalb County Government. The BOC is comprised of seven part-time commissioners, who are elected to serve four-year terms. Each of the seven Commissioners is responsible for the management of their respective offices, which includes controlling the offices’ budget and hiring staff members, contractors, and consultants. In recent years, the operating budget for a Commissioner’s office has been approximately $250,000 per year. The Commissioners may use their budget only for county-related business.
In 1992, Ms. Boyer began serving as the Commissioner of District 1, which served citizens in north DeKalb County, including in Brookhaven, Dunwoody, Tucker, and Smoke Rise, Georgia. Among other responsibilities, Ms. Boyer sat on the BOC’s Finance, Budget, and Audit Committee and was the Chairwoman of the Employee Relations and Community Services Committee. Although Boyer’s term of office did not expire until 2016, she resigned on August 25, 2014, the day before she was charged in this case.
In September 2009, as the Commissioner of District 1, Ms. Boyer retained an individual (“Advisor”) supposedly to assist her with government consulting and advisory duties on issues that affected her constituents. From September 2009 to November 2011, false invoices were submitted to Ms. Boyer’s office for consulting services purportedly rendered by the Advisor. In fact, the Advisor performed no services for Ms. Boyer, District 1 constituents, or DeKalb County. Ms. Boyer used the false invoices as a basis to authorize payments to the Advisor. Based on requisition requests from Ms. Boyer, DeKalb County issued approximately 35 checks to the Advisor for consulting services that were never performed. In total, DeKalb County paid the Advisor approximately $80,000, believing that legitimate services had been performed for the county.
After being paid by DeKalb County, the Advisor funneled approximately 75% of the money received from DeKalb County into Ms. Boyer’s personal bank account. Between September 2009 and November 2011, the Advisor deposited approximately $60,000 in DeKalb County funds into Ms. Boyer’s personal bank account (while retaining the remainder of the money). In turn, Ms. Boyer used the money deposited into her account to pay personal expenses, including purchases at hotels and high-end department stores.
Additionally, in her capacity as a Commissioner, DeKalb County issued Ms. Boyer a Visa Purchasing Card (“P-Card”) to make county-related purchases. On January 14, 2010, she signed a Cardholder Users’ Agreement stating she would not use the P-Card to make personal purchases.
From October 2010 to February 2014, Ms. Boyer made more than 50 personal purchases on her P-Card, including purchasing airline tickets and hotel rooms for herself and her family for personal travel. In total, she made over $15,000 worth of purchases on her P-Card for personal goods and services.
On September 3, 2014, Elaine Boyer, 58, of Stone Mountain, Georgia, pleaded guilty to one count of conspiring to commit mail fraud and one count of wire fraud. Today, Boyer was sentenced to one year, two months in prison to be followed by three years of supervised release, and ordered to pay restitution in the amount of $87,350.
On February 20, 2015, Elaine Boyer’s husband, John Boyer, 62, of Stone Mountain, Georgia, also pleaded guilty to one count of conspiring to commit mail fraud. Mr. Boyer is scheduled to be sentenced on May 6, 2015, at 2:00 p.m., before the Honorable Orinda D. Evans.
This case is being investigated by Federal Bureau of Investigation.
Assistant United States Attorneys Jeffrey W. Davis and Kurt R. Erskine are prosecuting the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao/gan/.
Former D.C. Goverment Employee Pleads Guilty to Using Government-Issued Credit Cards for Personal PurposesRead the Press Release
WASHINGTON – Terrell McCray, 31, a former employee of the District of Columbia Department of Fire and Emergency Medical Services (DCFEMS), pled guilty today to using government-issued credit cards to make purchases over $4,000 in gasoline for personal vehicles, announced U.S. Attorney Ronald C. Machen Jr. and Robert C. Erickson, Deputy Inspector General of the U.S. General Services Administration (GSA).
McCray was arrested in January 2015, following an investigation by the Office of the Inspector General for the U.S. General Services Administration (GSA). He had been a ticket writer in the DCFEMS Fleet Division.
McCray, of Washington, D.C., pled guilty in the Superior Court of the District of Columbia to a charge of first-degree misdemeanor fraud. The Honorable Neal E. Kravitz scheduled sentencing for May 20, 2015. The charge carries a statutory maximum of 180 days in jail and/or financial penalties. The plea agreement calls for McCray to make full restitution.
In a related investigation, Kimberley Pinkney, 45, of Washington, D.C., pled guilty on March 9, 2015 to second-degree felony fraud. Pinkney, a former inspector with DCFEMS, admitted using her government-issued credit card to purchase over $11,000 in gasoline for her personal vehicle. She is to be sentenced on May 5, 2015. She also agreed to make full restitution.
According to a proffer of facts submitted at today’s plea hearing, GSA administers the leases of over 150,000 government vehicles, including 41 to DCFEMS. Each vehicle is assigned a credit card to be used to purchase fuel and pay for other normal vehicle-related expenses, such as car washes and routine maintenance. GSA pays charges on the cards with federal funds.
McCray’s actions came to light in the fall of 2014 during a proactive review of purchases associated with the government credit cards. Investigators flagged suspicious activity. McCray was interviewed by GSA investigators in December 2014 after he was observed that month selling gas to fuel two Mercedes Benz sedans with Maryland license plates. The investigation also determined he fueled his own Jaguar and other persons’ vehicles on multiple occasions.
McCray acknowledged to investigators that he used government cards for personal use, and stated that he also sold gas at discounts to friends and acquaintances. A review of purchases made between Aug. 16, 2014 and Dec. 12, 2014, showed that the total fraud generated by his use of these cards as $4,170.
In announcing the plea, U.S. Attorney Machen and Deputy Inspector General Erickson commended those who investigated the case, including the team led by Special Agent in Charge Gerald Garren. They also expressed appreciation for the assistance provided by the Internal Affairs Unit and the command staff of the D.C. Department of Fire and Emergency Medical Services. Finally, they acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialist Kristy Penny and Assistant U.S. Attorney Stephanie G. Miller, who is prosecuting the case.
Former Contract Employee of Radford Army Ammunition Plant Charged with Sexual AssaultRead the Press Release
ROANOKE, VIRGINIA – A former contract employee at the Radford Army Ammunition Plant has been indicted by a federal grand jury sitting in the Western District of Virginia in Roanoke on sexual assault charges.
Joshua Linkous, 39, of Dublin, Va., has been charged with one count of aggravated sexual abuse by force, three counts of abusive sexual contact and five counts of attempted aggravated sexual abuse by force.
According to the indictment, Linkous is alleged to have sexually assaulted AV1 [Adult Victim #1] on July 27, 2014 through the penetration of the genital opening by hand or finger. Linkous is also accused of attempting to sexually assault AV1 in March or April of 2014 and again in early 2013. All of these actions took place within the boundaries of the Radford Army Ammunition Plant.
In addition, Linkous is charged with attempting to sexually assault AV2 [Adult Victim #2] in or around May 2014 and again in or around June 2014. Linkous is also charged with abusive sexual contact against AV2 for the June 2014 incident. All of these actions took place within the boundaries of the Radford Army Ammunition Plant.
The indictment also alleges that between August 2010 and December 2011, Linkous attempted to sexually assault AV3 [Adult Victim #3]. The defendant is also charged with abusive sexual contact for the incident between August 2010 and December 2011.
If convicted, Linkous faces a maximum possible penalty of life in prison.
The investigation of the case was conducted by the United States Army’s Criminal Investigation Division, the Federal Bureau of Investigation, and the Defense Criminal Investigative Service. Assistant United States Attorneys Erin Kulpa and Laura Rottenborn will prosecute the case for the United States.
A Grand Jury Indictment is only a charge and not evidence of guilt. The defendant is entitled to a fair trial with the burden on the government to prove guilt beyond a reasonable doubt.
Former Bradenton Housing Authority Project Director Pleads Guilty to Theft of Government FundsRead the Press Release
Tampa, Florida – United States Attorney A. Lee Bentley, III announces that Stephany West (51, Bradenton) today pleaded guilty to theft of federal funds. She faces a maximum penalty of 10 years in federal prison. A sentencing date has not yet been set.
According to the plea agreement, from June 2, 2008, until September 19, 2013, West, a/k/a “Stephany Shaw,” was employed as the Project Director of the Bradenton Housing Authority (“BHA”). The BHA is a local housing authority agency of the City of Bradenton and received $10,000 or more in federal funds from the United States Department of Housing and Urban Development.
Between September 2010 and September 2013, West was routinely absent from the BHA and engaged in non-BHA activities during work hours. She failed to take annual or sick leave for these absences, and accepted her regular salary for work. From September 2010 through September 2012, West was absent and engaged in non-BHA activities at least 25 percent of the time. Between September 2012 and September 19, 2013, West was absent and engaged in non-BHA activities approximately 50 percent of the time. In total, West stole and knowingly converted to her own use approximately $73,783. from the BHA by taking salary, benefits, and bonuses that she had not earned and to which she was not entitled. She stole another $30,767.60 by cashing out unused annual and sick leave, which she should have otherwise used while spending work hours attending to personal affairs. Thus, West’s actions caused a total loss to the BHA of approximately $104,550.
This case was investigated by the U.S. Department of Housing and Urban Development - Office of Inspector General, the Federal Bureau of Investigation, the Florida Department of Law Enforcement, and the Bradenton Police Department. It is being prosecuted by Assistant United States Attorney Jennifer L. Peresie.
First of Eight Defendants Pleads Guilty in Tax Fraud and Identity Theft Scheme in El Dorado & Crossett, ArkansasRead the Press Release
Texarkana, AR – Conner Eldridge, United States Attorney for the Western District of Arkansas, announced that Erica R. Browning, age 35, of El Dorado, pleaded guilty today to one count of Conspiracy to Defraud the United States with Respect to Claims, one count of Theft of Public Money, and one count of Aggravated Identity Theft. Ms. Browning was one of eight defendants indicted on June 24, 2014 by a Federal Grand Jury on multiple counts of aggravated identity theft and one count of conspiracy to defraud the government. Additionally, some of the defendants were charged with theft of public money, possession of unauthorized access devices, wire fraud, and making and presenting a false claim. The change of plea was accepted by The Honorable Harry F. Barnes in the U.S. District Court in Texarkana.
U.S. Attorney Eldridge stated, “This case involves a scheme in which the defendants fraudulently used the identity of others in order to steal money from the United States Treasury for their own personal gain. Fraud and identity theft are serious crimes that have lasting effects on the victims and are an insult to hard-working, law abiding citizens and taxpayers. Our office remains committed to prosecuting these crimes on behalf of the state and our country.”
"Today's announcement exemplifies IRS Special Agents' intense focus on the rigorous pursuit of identity theft and refund fraud," said Special Agent in Charge Christopher A. Henry, IRS Criminal Investigation. "These unscrupulous defendants perpetuated an elaborate scheme driven by insatiable greed and a blatant disregard for the tremendous damage inflicted on innocent victims. Be assured that IRS Criminal Investigation, together with our law enforcement partners and the United States Attorney's Office, will hold those who engage in similar behavior fully accountable."
Additional defendants involved in this case who have pending charges are as follows:
• Gregory A. Taylor, age 50 of Clanton, Alabama (formerly from Crossett, Arkansas)
• Venus M. Ford, age 34 of El Dorado
• Shawn D. Carey, age 34 of El Dorado
• Clarrise R. Carey, age 33 of El Dorado
• Whitney M. Charles, age 25 of El Dorado
• Ecko Scott, age 35 of North Little Rock
• Sanjuana N. Aaron, age 34 of El Dorado
The Superseding Indictment revealed that, from 2009 until approximately December 2011, the defendants unlawfully obtained the names and social security numbers belonging to others, including prison inmates and homeless individuals. The defendants unlawfully used the names and social security numbers to prepare and electronically file false 2009 and 2010 tax returns that claimed fraudulent refunds from the IRS. In many cases, the individuals were not aware the defendants had obtained their personal identifying information or that a tax return was filed using their name and social security number. The defendants received tax refunds via refund checks, direct deposits to bank accounts, and prepaid debit cards and often split the refunds amongst themselves and others.
The defendants were originally charged in a thirty-five count indictment on September 18, 2013 and were subsequently arrested. The Superseding Indictment added thirteen additional counts against Gregory A. Taylor, a paid tax return preparer from Crossett, Arkansas, for charges including aggravated identity theft, wire fraud, and a fraudulent claim for refund on his personal 2009 tax return.
Ms. Browning will be sentenced at a later date. Her 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 violations. The sentence will not exceed the statutory maximum for each count in this case, and in most cases will be less than the maximum. In addition to prison time each count carries a mandatory period of supervised release and a maximum fine of $250,000.
The investigation was conducted by IRS Criminal Investigation, U.S. Secret Service, El Dorado Police Department, and Crossett Police Department. Assistant U.S. Attorney Jonathan Ross is prosecuting the cases for the United States.
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Related court documents may be found on Public Access to Electronic Records Website @www.Pacer.gov
Federal Jury Convicts Four Baltimore Area Drug Dealers in Conspiracy to Distribute Kilograms of Cocaine and HeroinRead the Press Release
Baltimore, Maryland – A federal jury today convicted Jermaine Cannady, a/k/a “Main,” age 39; Cornell Dion Brown, a/k/a “Nelly,” age 29; Dominic William Parker, a/k/a “Nick,” age 30, all of Baltimore; and Ronald Timothy Sampson, a/k/a “Little Ronald,” age 35, of Windsor Mills, Maryland for conspiracy to distribute kilograms of cocaine and/or heroin, and for attempting to possess with intent to distribute cocaine and/or heroin.
The guilty verdicts were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Assistant Special Agent in Charge Gary Tuggle of the Drug Enforcement Administration, Baltimore District Office; and Commissioner Anthony W. Batts of the Baltimore Police Department.
According to evidence presented at the nine day trial, on August 11, 2014, each of the defendants agreed to purchase kilogram amounts of cocaine and/or heroin from a cooperating individual (CI). Law enforcement had previously seized 25 kilograms of cocaine and six kilograms of heroin from a concealed compartment in a motor home that the CI used to transport the drugs from California to Maryland. The defendants agreed to meet the CI in the parking lot of a Baltimore area mall to complete the drug transaction. The telephone calls with the defendants arranging the transactions were recorded.
Witnesses testified that Brown and co-defendant Tavon Hopkins were arrested after they arrived to pick up the four kilograms of cocaine they had agreed to purchase from the CI. At the time of their arrest, law enforcement recovered $157,000 in cash from a bag in their vehicle. Cannady and Parker were also arrested when they arrived at the meeting location to pick up the cocaine and heroin requested by Cannady. No cash was recovered from Cannady and Parker, although the CI explained that they were usually provided with heroin and cocaine without payment up front. Cannady and Parker had in their possession multiple cell phones and a police scanner.
According to evidence presented at trial, Sampson indicated that he wished to purchase a kilogram each of cocaine and heroin. Sampson told the CI that he was calling up his buyers to get as much money as possible to give to the CI for the purchase of the cocaine and heroin. When Sampson met the CI to complete the drug transaction, he was also arrested. Law enforcement seized $10,500 after a search of Sampson and his vehicle.
The defendants each face a mandatory minimum sentence of 10 years in prison and up to life in prison for conspiring to distribute and possess with intent to distribute cocaine and/or heroin, and for attempted possession with intent to distribute cocaine and/or heroin. U.S. District Judge Richard D. Bennett has scheduled sentencing for Sampson, Parker, Cannady and Brown on June 24, June 26, June 29, and June 30, 2015, respectively.
Four co-defendants previously pleaded guilty to their participation in the scheme to distribute five or more kilograms of cocaine: Antoine DeMarr Washington, age 42, of Washington, D.C.; Guy Bordes Agnant, Jr., age 38, of Laurel, Maryland; Tavon Alexander Louis Hopkins, age 38, of Baltimore; and Vincent Cooper, age 47, of Washington, D.C. Donte Eugene Taylor, age 39, of Baltimore also pleaded guilty to his role in the scheme. All are awaiting sentencing.
United States Attorney Rod J. Rosenstein commended the FBI, DEA and Baltimore Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Christopher J. Romano and Seema Mittal, who are prosecuting the case.
Escapee from Nashville Captured Near AtlantaRead the Press Release
James Inman Taylor III, 29, of Nashville, Tenn., was captured today near an Atlanta motel after being sought since his escape from Metro Nashville detectives on February 5, 2015, announced David Rivera, U.S. Attorney for the Middle District of Tennessee.
Taylor was apprehended by FBI agents after a brief chase and struggle, after he was seen leaving a motel near Atlanta. Prior to his escape in February, Taylor had been charged with federal crimes including 2 Hobbs Act Robberies and 2 counts of using a firearm during a crime of violence. He is accused of taking part in the robberies of two Nashville Piggly Wiggly grocery stores on January 9, 2015.
Metro Nashville Police, along with the FBI, TBI and U.S. Marshals had been searching for Taylor since his escape in February. Taylor is currently being held in federal custody in Atlanta.District Man Sentenced to a Year in Prison for Burglary of Office ComplexRead the Press Release
WASHINGTON – David Pitts, 38, of Washington, D.C., was sentenced today to a year and a day in prison on charges stemming from an incident in which he broke into an office building in Northwest Washington after setting a series of fires, U.S. Attorney Ronald C. Machen Jr. announced.
Pitts pled guilty in January 2015, in the Superior Court of the District of Columbia, to charges of second-degree burglary and first-degree identity theft. He was sentenced by the Honorable Zoe Bush. Judge Bush sentenced Pitts to a total of two years in prison on the charges, but suspended all but a year and a day of the time. Following completion of his prison term, he will be placed on three years of supervised release.
According to a proffer of facts Pitts agreed to at the plea hearing, on Sept. 4, 2014, at about 12:50 a.m., Pitts set a chair and bottles on fire near the parking attendant booth of the parking garage at an office complex in the 3300 block of New Mexico Avenue NW. The fire destroyed the chair and caused damage to the attendant booth. He then walked to another part of the complex and twice lit some newspapers on fire on the ground; this caused no damage.
Minutes later, Pitts walked to a wooded area near the adjacent Embassy Park complex and set another small fire. This fire grew, and had to be extinguished by the District of Columbia Fire and Emergency Medical Services Department.
After setting the fires, Pitts entered the office building on New Mexico Avenue, which houses doctors’ offices and a pharmacy, with the intent to steal prescription medications, controlled substances, and prescription pads. He was arrested at the scene. A subsequent search of the defendant’s apartment led to the recovery of over 5,300 pills, blank prescription pads from at least nine different doctors’ offices, and other items. Many of the blank prescription pads were for doctors who had offices in the complex. Additional blank prescription pads were found in a search of the defendant’s office.
Pitts also faces multiple charges of second-degree burglary, theft and destruction of property in Montgomery County, Md.
In announcing the sentence, U.S. Attorney Machen commended the work of those who investigated the case from the Metropolitan Police Department, the Montgomery County, Md. Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the District of Columbia Fire and Emergency Medical Services Department. He also expressed appreciation for the work of former Assistant U.S. Attorney Brittain Shaw, who investigated the case, and Assistant U.S. Attorney Christopher Bruckmann, who prosecuted the matter.
Dallas Woman Sentenced to 27 Months in Federal Prison for Committing Financial Aid FraudRead the Press Release
DALLAS — A Dallas woman who was convicted following a bench trial last year on all six counts of an indictment charging financial aid fraud, was sentenced today, announced John Parker, Acting U.S. Attorney for the Northern District of Texas.
Sussette Sheree Timmons, 42, was sentenced by U.S. District Judge Barbara M. G. Lynn to 27 months in federal prison and ordered to pay $20,000 in restitution to the U.S. Department of Education.
“It’s bad enough to lie about your identity or income to obtain financial aid”, said Acting U.S. Attorney Parker, “but Ms. Timmons’ fraud is particularly egregious because she never even intended to attend school. Abuses like this of the federal student aid system must not be tolerated for the sake of the many individuals who truly need aid for education, and for the sake of taxpayers. I commend the investigative efforts of the Department of Education’s Office of Inspector General in identifying this fraud.”
The government presented evidence at trial that Timmons applied for admission to, and received financial aid from several universities/colleges, e.g., New Mexico State University, Western New Mexico University, Ashford University, Northern New Mexico College, Coconino Community College, and Pima County Community College, to fund her education at the institutions.
As part of her scheme to defraud these institutions and the U.S. Department of Education, Timmons never intended to use the disbursed funds for education, but instead intended to embezzle, misapply, steal and use the funds for her own personal use. Timmons also failed or refused to refund the financial aid funds when required to do so.
In total, the amount of funds that Timmons embezzled, misapplied, stole or obtained by fraud, false statement or forgery, or failed to refund, was $64,115.
The U.S. Department of Education Office of Inspector General investigated. Assistant U.S. Attorney P.J. Meitl prosecuted.
Chicago Area Man Convicted on Child Pornography ChargesRead the Press Release
CHICAGO ― A Chicago area man was convicted today for producing child pornography involving a minor whom he photographed in sexually explicit photos as a part of a fantasy world that the defendant created. The defendant, JOHN GABRIEL, 79, of Lockport, who has been in custody since he was arrested on federal charges in September 2013, was found guilty of one count of manufacturing child pornography. U.S. District Court Judge John J. Tharp has not yet set a sentencing date. According to court documents and witness testimony during the four day trial, defendant Gabriel enticed a 17 year old girl by creating a religious fantasy world in which he used the pseudonym “Sarah” to email the victim under the guise of being an angel who had selected the victim to participate in a “Program” run by the angels, in order to save young boys from Satan. In addition to instructing the minor victim about the Program, Sarah suggested that the victim should develop a closer relationship with defendant. For example, in one email, Gabriel wrote “listen closely to those things John [defendant] tells you. You can have a happy life and you can leave all the dirty nasty sinful things behind.”
Essentially, according to the emails received by the victim, the Program dictated that if participants had sex with troubled young boys, under the age of 18, then they were assisting in training the boys in better behavior, and to fight the devil. In addition, according to these emails, each time a participant had sex with a troubled boy; a wealthy benefactor would purchase guide dogs for the blind and fund children’s wings for hospitals. The defendant took sexually explicit photos of the victim and posted them on an Internet website, purportedly for the purpose of recruiting the troubled young boys to have sex with the victim.
Gabriel faces a minimum sentence of fifteen years in prison for manufacturing child pornography, and a $250,000 fine. The Court must impose a reasonable sentence under federal statues and the advisory United States Sentencing Guidelines.
The sentence was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois, and Robert J. Holley, Special Agent in Charge of the Chicago Office of the Federal Bureau of Investigation.
The case was prosecuted by Assistant United States Attorneys Barry Jonas and Shoba Pillay.
Carlisle Barracks Army Contractor Charged with Theft Involving Misuse of Credit CardsRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania, announced that, on March 18, a federal grand jury in Harrisburg indicted Scott J. Robinson, of Shippensburg, Pennsylvania, charging him with theft of government property.
According to the United States Attorney Peter Smith, the indictment alleges that Robinson was a civilian contractor performing landscaping and lawn care work at the U.S. Army Garrison (War College), Carlisle Barracks, in Cumberland County, Pennsylvania. Robinson was given access to four government credit cards, issued by the General Services Administration (GSA) to the U.S. Army to purchase fuel for government-owned vehicles used by the defendant to perform his responsibilities under the contract. Robinson allegedly used the credit cards to fuel his own personal vehicle. Between February and July, 2014, Robinson allegedly purchased fuel and other unauthorized items in the amount of approximately $3,602.
The case was investigated by the GSA Office of Inspector General. Assistant U.S. Attorney Gordon Zubrod has been assigned to prosecute the case.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
In this case, the maximum penalty under the federal statute is 15 years imprisonment, a term of supervised release following imprisonment, and a $250,000 fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
Bridgeport Man Sentenced to 4 Years in Federal Prison for KidnappingRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that PAUL WHITEHURST, also known as “Juice,” 25, of Bridgeport, was sentenced today by U.S. District Judge Stefan R. Underhill in Bridgeport to 48 months of imprisonment, followed by five years of supervised release, for kidnapping.
According to court documents and statements made in court, in January 2013 the Danbury Police Department began investigating a narcotics trafficking network that maintained a series of drug distribution locations, known as trap houses, in Danbury, out of which members of the organization sold crack and heroin. The organization also rented hotel rooms where they packaged and distributed narcotics. During the investigation, law enforcement learned that the individuals who headed the drug trafficking ring had organized and committed armed home invasion robberies of marijuana dealers.
WHITEHURST sold narcotics on behalf of the organization. He also oversaw two trap houses and rented hotel rooms for additional drug distribution.
In approximately May 2013, WHITEHURST and a co-defendant approached an individual who was walking in Danbury and directed the victim to get into their vehicle. At the time, the victim owed WHITEHURST a drug debt of approximately $100. In the car, WHITEHURST physically and verbally assaulted the victim as they drove to a nearby reservoir. At the reservoir, WHITEHURST pushed the victim into the water and then threw rocks at him. WHITEHURST and others then drove the victim to a liquor store and purchased a liter of vodka, which WHITEHUST forced the victim to drink in its entirety in approximately 15 minutes until the victim lost consciousness. The victim, still unconscious, was then driven to a trap house where he was locked in a bathroom overnight. The next day, WHITEHURST directed the victim to work off his drug debt by selling heroin to customers. After selling the drugs, the victim was released.
WHITEHURST has been detained since August 2013. On October 22, 2014, he pleaded guilty to one count of kidnapping.
This matter has been investigated by the Drug Enforcement Administration’s New Haven Task Force and the Danbury Police Department. The DEA Task Force includes personnel from the New Haven, Hamden, West Haven, North Haven, Branford, Ansonia and Meriden Police Departments. The case is being prosecuted by Assistant U.S. Attorneys Tracy Dayton and Vanessa Richards.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Bank Robber Sentenced to 15 Years in Federal PrisonRead the Press Release
Orlando, Florida – U.S. District Judge Paul G. Byron has sentenced William Demethris Bass (40, Oviedo) to 15 years in federal prison for bank robbery. He pleaded guilty on November 4, 2014.
According to court documents, Bass robbed three Orlando-area banks. He robbed a SunTrust Bank branch on June 10, 2014, and two different Fairwinds Credit Union branches on June 14, 2014. Bass continued his spree of robberies in Hinesville, Georgia, and he faces additional federal charges in the Southern District of Georgia.
This case was investigated by the Federal Bureau of Investigation and the Orange County Sheriff’s Office. It was prosecuted by Assistant United States Attorney Embry J. Kidd.
Baltimore Man Sentenced to Five Years in Prison for Receipt of Child PornographyRead the Press Release
Baltimore, Maryland – U.S. District Judge J. Frederick Motz sentenced Richard Ho Lee, age 33, of Baltimore, today to five years in prison, followed by 11 years of supervised release, for receipt of child pornography. Judge Motz also ordered that upon his release from prison, Lee must register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA). In addition, Judge Motz entered an order requiring that Lee to forfeit property that was used or intended to be used to commit or to promote the offenses to which Lee has pleaded guilty. The property to be forfeited includes Lee’s home in the 600 block of South Wolf Street in Baltimore, two laptop computers and an external hard drive.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Chief James W. Johnson of the Baltimore County Police Department; Commissioner Anthony W. Batts of the Baltimore Police Department; and Baltimore City State’s Attorney Marilyn J. Mosby.
According to Lee’s plea agreement, on five occasions in September and October of 2011, while Lee and the victim were in Baltimore, Lee purchased sex from T.F. At the time, T.F. was representing to patrons that she was 19 when, in fact, she was 16. On October 31, 2011, Lee paid for a bus ticket for T.F. to travel to Panama City, Florida, where Lee met her. Lee took the victim to a condo he had rented in Panama City. Upon arriving in Panama City, T.F. told Lee that she was only 16 years old. According to the statement of facts, Lee continued to have sex with T.F., and encouraged her to engage in prostitution. From about December 22, 2011 to January 4, 2012, Lee placed at least 15 advertisements for the victim in the “escorts” and “body rubs” sections of an adult website. Lee used his personal credit card to pay for the advertisements. Lee took provocative photographs of T.F. in lingerie and underwear that he had purchased for her and attached some of the photos to the advertisements. Lee rented a second condominium where T.F. had sex with customers and agreed to provide Lee with a percentage of her earnings.
On January 9, 2012, Lee purchased a bus ticket for T.F., which she used to travel from Florida back to Maryland. In January 2012, Lee produced a counterfeit North Dakota state driver’s license for T.F., which indicated that she was 22 years old. In May 2012, Lee took provocative photographs of T.F. inside his residence in Baltimore.
In June 2012, federal agents recovered Lee’s laptop computers and an external hard drive which contained over 600 images of child pornography, including images that depicted minors that are less than twelve years old and portrayed sadistic and masochistic conduct. Further, the laptop contained templates designed to be used for the production of counterfeit state driver’s licenses.
The case was investigated by the FBI-led Maryland Child Exploitation Task Force (MCETF), created in 2010 to combat child prostitution, with members from10 state and federal law enforcement agencies. The Task Force coordinates with the National Center for Missing and Exploited Children and the Maryland State Police Child Recovery Unit to identify missing children being advertised online for prostitution.
MCETF partners with the Maryland Human Trafficking Task Force, formed in 2007 to discover and rescue victims of human trafficking while identifying and prosecuting offenders. Members include federal, state and local law enforcement, as well as victim service providers and local community members. For more information about the Maryland Human Trafficking Task Force, please visit http://www.justice.gov/usao/md/priorities_human.html.
United States Attorney Rod J. Rosenstein commended the FBI, Baltimore County Police Department, Baltimore City Police Department and the Baltimore City State’s Attorney’s Office for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Rachel M. Yasser, who prosecuted the case.
Arcade Man Indicted on Drug and Gun ChargesRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
BUFFALO, N.Y.–U.S. Attorney William J. Hochul, Jr. announced today that a federal grand jury has returned a 10 count indictment charging Ryan Tojdowski, 31, of Arcade, NY, with manufacturing marijuana, possession with intent to distribute marijuana, oxycodone, morphine, alprazolam, hydrocodone, clonazepam, dihydrocodeine, maintaining a drug involved premises, and possession of a firearm in furtherance of a drug trafficking crime. The charges carry a mandatory minimum penalty of five years in prison, a maximum of 20 years and a $500,000 fine.
Assistant U.S. Attorney Caleb J. Petzoldt, who is handling the case, stated that according to the indictment, on December 17, 2014, during the course of an investigation, the Wyoming County Sheriff’s Department discovered the defendant to be in engaged in the manufacturing and distribution of marijuana. In addition, deputies found Tojdowski to be in possession of quantities of oxycodone, morphine, alprazolam, hydrocodone, clonazepam, dihydrocodeine as well as a .223 assault rifle.
The indictment is the culmination of an investigation on the part of the Wyoming County Sheriff’s Department, under the direction of Gregory J. Rudolph and the Drug Enforcement Administration, under the direction of Special Agent in Charge James J. Hunt, New York Field Office.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
Albert Torres Morales Sentenced to 84 Months on Firearms and Drug ChargesRead the Press Release
The Office of the United States Attorney for the District of Vermont stated that Albert Torres Morales, 30, of Richford, Vermont was sentenced today to 84 months imprisonment on charges that he carried a firearm in relation to a drug trafficking crime, and conspired to distribute heroin, cocaine base, and cocaine. Chief Judge Christina Reiss also ordered that Torres Morales serve a three-year period of supervised release following his term of imprisonment.
According to court records, the Vermont Drug Task Force conducted more than ten controlled purchases of heroin, cocaine base, and cocaine from Torres Morales in and around Richford between January and April 2014. According to sources cooperating with law enforcement, Torres Morales regularly possessed a firearm in connection with his drug dealing activity. During a controlled purchase of heroin on March 24, 2014, law enforcement captured audio and video footage of Torres Morales in possession of a handgun while he conducted a heroin transaction.
In the overnight hours of April 19, 2014, Larry Garrow, Jr. of Richford burglarized Rite-Way Sports in Hardwick of 32 handguns. Jaime Hoben then drove with Garrow to Richford, where Garrow traded some 20 of the handguns to Torres Morales for heroin and money. The firearms consisted of .380 and 9mm handguns. Those firearms have not been recovered. The remaining handguns were recovered when Larry Garrow, Sr. found a bag of guns in the bedroom of his son, Larry Garrow, Jr., and turned them in to the Vermont State Police.
On April 22, 2014, law enforcement executed a search warrant at Torres-Morales’s residence, the location of numerous controlled purchases of narcotics from Torres-Morales. Among other items, agents recovered a drug ledger and a safe containing $6,000 in cash. Torres-Morales was arrested the same day with heroin and over $1,000 in cash.
Also in connection with this case, Hoben was sentenced to six months imprisonment and three years of supervised release on a charge of possession of stolen firearms. On March 2, 2015, Garrow was sentenced to 30 months imprisonment and three years of supervised release after his conviction for possession of stolen firearms. As part of his plea agreement with the government, Garrow stipulated that he stole the firearms from Rite-Way Sports.
This matter was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Vermont State Police, with the assistance of the United States Border Patrol, and the Hardwick Police Department. The United States was represented by Assistant U.S. Attorney Kevin J. Doyle. Torres-Morales was represented by Michael L. Desautels, Esq. of the Federal Defender’s Office
Thursday 19 March 2015
“Gold Club” Owner Among Those Indicted for Using Business to Operate Elaborate Money Laundering SchemeRead the Press Release
SAN FRANCISCO – Seven persons -- Vladimir Handl, Michael Rose, Peter Scalise, David Gaither, Richard Leyland, Edwin Hetherton, and Paul Fink -- were arrested after being charged with racketeering, money-laundering, and drug trafficking related crimes, announced United States Attorney Melinda Haag and Federal Bureau of Investigation Special Agent in Charge David J. Johnson.
According to an indictment that was unsealed yesterday, Handl and Rose were businessmen in Myrtle Beach, South Carolina, whose interests included restaurants, nightclubs, and strip clubs in several states. Handl operated and controlled businesses such as VIP Group, LLC, International VH, LLC, and Heat Lounge, LLC, while Rose operated and controlled defendant PML Clubs, Inc., along with Explosive Clubs, Inc., Nightclub and Restaurant Services, LLC, Legacy Entertainment, East Coast Restaurant & Nightclubs, and Micro Management Group, LLC. Rose, through PML Clubs, Inc., operated several strip clubs in South Carolina, Delaware, and New Hampshire under the name “The Gold Club.” Rose, through PML Clubs, Inc., also licensed the use of the name “The Gold Club” to franchisees throughout the United States.
According to the indictment, Handl and Rose, along with their associates, Peter Scalise, and David Gaither, conspired to conduct the affairs of an enterprise through a pattern of racketeering involving money laundering, bank fraud, and drug trafficking. Between 2011 through the present, the defendants knowingly accepted more than $2.3 million that they believed either had been fraudulently diverted from a bankruptcy court proceeding or constituted proceeds from drug trafficking, and then laundered the money through their businesses, including Rose’s Gold Clubs. The indictment further alleges that as part of their laundering scheme, the defendants created fraudulent invoices, contracts, and other business records to make it appear that the money they received and “cleaned” was for legitimate business transactions. The defendants also sought to acquire cocaine to sell.
Handl, Rose, Scalise, Gaither, and PML Clubs, Inc., are all charged with racketeering conspiracy, in violation of 18 U.S.C. § 1962(d), while Handl, Rose, Scalise, and PML Clubs, Inc., are also charged with substantive racketeering, in violation of 18 U.S.C. § 1962(c). In addition, Handl, Rose, Scalise, and PML Clubs, Inc., are charged with conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(h). Furthermore, Handl and Scalise are each charged with 118 counts of substantive money laundering, in violation of 18 U.S.C. § 1956(a)(3), while Rose and PML Clubs, Inc., are each charged with 105 counts of substantive money laundering.
Richard Leyland and Edwin Hetherton, in turn, are charged with a money laundering conspiracy of their own. In addition to the conspiracy change, Leyland is charged with four counts of substantive money laundering and Hetherton is changed with three counts of substantive money laundering. Both Leyland and Hetherton also are charged with theft of United States property.
Handl and Paul Fink are also charged with conspiring to possess cocaine with intent to distribute, in violation of 21 U.S.C. § 846.
All seven defendants were taken into custody today in arrests coordinated throughout the country. Rose and Scalise were arrested in the vicinity of Myrtle Beach, South Carolina. Handl and Gaither were arrested in the vicinity of Florence, South Carolina. Fink was arrested in the vicinity of Chico, California; Hetherton was arrested in the vicinity of Sacramento, California; and Leyland was arrested in the vicinity of Fort Washington, Pennsylvania. They all are expected eventually to make appearances in San Francisco in connection with the indictment filed in the federal district court in the Northern District of California.
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, the corporate defendant PML Clubs, Inc., could face a maximum fine of $250,000 for each of the two racketeering-related counts, and $500,000 for each count of the 106 money laundering-related counts. Additional special assessments may apply.
The individual defendants face a maximum 20-year term of imprisonment for each racketeering-related count and each money laundering-related count. Further, the individual defendants face a maximum 10-year term of imprisonment for each theft of United States property count, and a maximum 20-year term of imprisonment for the conspiracy to possess cocaine with intent to distribute. Each defendant’s maximum terms of imprisonment are as follows:
- Handl: 2,440 years’ imprisonment
- Rose: 2,160 years’ imprisonment
- Scalise: 2,420 years’ imprisonment
- Gaither: 40 years’ imprisonment
- Leyland: 110 years’ imprisonment
- Hetherton: 90 years’ imprisonment
- Fink: 20 years’ imprisonment
Additional periods of supervised release, fines, and special assessments also could be imposed. Any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant United States Attorneys David Countryman and W.S. Wilson Leung are prosecuting the case with the assistance of Lance Libatique and Carolyn Jusay. The prosecution is the result of an investigation by the Federal Bureau of Investigation.
“Caught on Video”: Final Defendant Sentenced in Federal Drug Conspiracy TrialRead the Press Release
Contact Person: A. Lance Crick (864) 282-2100
COLUMBIA, South Carolina ----- United States Attorney Bill Nettles stated today that Daniel Rodriguez, age 26, of Lilburn, Georgia, was sentenced to 155 months in federal prison earlier this afternoon in federal court in Greenville. Rodriguez, along with co-defendant, Jesus Buruca-Martinez, age 22, of Lawrenceville, Georgia, were found guilty after a federal trial in September 2014 of conspiracy to distribute 500 grams or more of methamphetamine, a violation of Title 21, United States Code, Section 846. Rodriguez was also found guilty of two counts of using a communication device (telephone) to facilitate the commission of a drug felony, a violation of Title 21, United States Code, Section 843(b). United States District Judge J. Michelle Childs presided over the trial and sentenced Rodriguez. Last month, Judge Childs sentenced Buruca-Martinez to a ten-year federal prison sentence.
Evidence presented at trial established that, beginning in early 2012, agents and task force officers with the DEA in Greenville, began investigating an upstate-based methamphetamine distribution network that was being sourced with pounds of methamphetamine from individuals in the Atlanta-area. Ultimately, over a two-year investigation and some seven superseding indictments, twenty-seven defendants were indicted in the conspiracy, with twenty-five entering guilty pleas. The investigation revealed that two members of this conspiracy, Dustin Tiller and Nicanor Perez-Rodriguez, both inmates in the South Carolina Department of Corrections at the time, contacted members of their families on the outside to arrange for methamphetamine to be transported from Georgia into South Carolina for further distribution.
After identifying Daniel Rodriguez as a Georgia-based member of the conspiracy who was making frequent trips to South Carolina to bring methamphetamine as well as collect drug proceeds, members of the Anderson County Sheriff’s Office and Anderson City Police Department were able to establish surveillance on Rodriguez, on Sunday, August 5, 2012, as Rodriguez met with other members of this conspiracy, to include Jesus Buruca-Martinez, in the parking lot of a restaurant, located off of Exit 19, Interstate 85, in Anderson County.
Agents then maintained surveillance on Rodriguez and Buruca-Martinez as they traveled in tandem, both driving separate vehicles, to a residence in Belton, South Carolina. Maintaining surveillance on the Belton residence, agents observed Buruca-Martinez leave the residence, followed by Rodriguez’s departure some twenty minutes later. Traffic stops were conducted on both vehicles and law enforcement seized $20,240 in cash from Buruca-Martinez.
Following the execution of a federal search warrant at the Belton residence and the arrest of Rodriguez, Buruca-Martinez, and others, that evening, agents reviewed a home surveillance system seized in the search. The surveillance system had an operational camera imaging the living room of the residence, attached to a digital video recording (DVR) system. In reviewing the images on the DVR, which dated back some two weeks from the incident date, agents observed Rodriguez arriving at the residence on two previous occasions in July 2012.
Regarding the activity inside the residence on August 5, 2012, a review of the video revealed Rodriguez, Buruca-Martinez, and third co-conspirator, who rode with Rodriguez that day from Georgia, counting, for several minutes, over $20,000 in cash. Witnesses testified that this cash was partial payment applied to the overall drug debt owed to Rodriguez and others for pounds of methamphetamine previously provided on consignment. As the money count concluded, the video showed Buruca-Martinez bundling two cash parcels, placing one in each cargo short pocket, and exiting the residence, ultimately heading south on Interstate 85 before he was stopped by law enforcement.
Nettles stated that the case was investigated and prosecuted by members of the Organized Crime and Drug Enforcement Task Force (OCDETF), a taskforce coordinated by the United States Attorney’s Office. Members of the task force involved in this investigation included the Anderson County Sheriff’s Office, the Anderson City Police Department, the South Carolina Highway Patrol, the Department of Homeland Security, and the Drug Enforcement Administration. Assistant United States Attorneys Andy Moorman and Lance Crick of the Greenville office handled the prosecution.####
Women’s History Month CommemoratedRead the Press Release
Today the United States Attorney’s Office for the Northern District of Iowa recognized Women’s History Month 2015 by hosting a program commemorating the 40th anniversary of the landmark Iowa Civil Rights Commission decision, Cedar Rapids Community School District v. Parr. United States Attorney Kevin Techau welcomed speakers and guests noting that this month, “We celebrate countless pioneering women and the legal victories they have won.”
Featured program speakers included Des Moines attorney Roxanne Conlin and Reverend Bill Cotton. They recounted how their professional careers crossed in the early-1970s when they fought against the injustice of gender discrimination facing two Cedar Rapids school teachers.
Over 50 attendees heard the speakers tell the story of how two pregnant school teachers were forced to leave their teaching positions in the Cedar Rapids School District beginning the fifth month of their pregnancy. One teacher, Joan Parr, was not tenured and the policy as it related to her called for a forced termination. Reverend Cotton, the first Director of the Cedar Rapids Civil Rights Commission, challenged this discriminatory practice. As the litigation commenced, Reverend Cotton connected with then Assistant Attorney General Roxanne Conlin, who successfully prosecuted the case all the way to the Iowa Supreme Court. In 1975, the High Court ruled that this practice discriminated against women and violated the Iowa Civil Rights Act. This case is considered a landmark ruling in Iowa jurisprudence.
One year after this ruling the US Supreme Court rejected a claim that an employer’s policy excluding pregnancy from its disability benefits plan did not violate Title VII of the 1964 Civil Rights Act’s prohibition on sex discrimination. Two years later Congress passed the 1978 Pregnancy Discrimination Act which overruled this decision. http://go.usa.gov/3CefA These facts highlight not only the bravery of two Iowa teachers pioneering women’s rights but the forward thinking of Iowa’s judiciary.
Both speakers closed their presentations by noting that Iowa courts have a long history of furthering the rights of citizens in many cases well before the United States Congress or the US Supreme Court conferred them. Speaker Conlin shared that, “This is something we as Iowans should have great pride in.”
US Attorney Techau echoed the Presidential Proclamation proclaiming March 2015 as Women’s History Month by stating, “We know that when women succeed, America succeeds.”
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West Seneca Man Pleads Guilty to Possession of Child PornographyRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051BUFFALO, N.Y.–U.S. Attorney William J. Hochul, Jr. announced today that Ryan Arcara, 25, of West Seneca, NY, pleaded guilty before Senior U.S. District Court Judge William M. Skretny, to possession of child pornography. The charge carries a maximum sentence of 10 years in prison, a $250,000 fine, or both.
Assistant U.S. Attorney Marie P. Grisanti, who is handling the case, stated that the defendant possessed eight image files and 59 video files containing child pornography stored on a computer and hard drive. Some of the images depicted prepubescent minors or minors under 12 years old.
The plea is the culmination of an investigation on the part of Special Agents of Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent in Charge James C. Spero.
Sentencing is scheduled for July 8, 2015, at 10:00 a.m. Judge Skretny.
Utah-Based Washakie Renewable Energy LLC Settles Renewable Fuel Standard ViolationsRead the Press Release
The Department of Justice today filed a stipulation of settlement resolving civil claims against Washakie Renewable Energy LLC (Washakie) for violations of the Renewable Fuel Program under the Clean Air Act. The stipulation of settlement was filed in the U.S. District Court of the District of Columbia. A complaint stating the government’s claims was filed at the same time, announced Assistant Attorney General John C. Cruden of the Justice Department’s Environment and Natural Resources Division and Assistant Administrator Cynthia Giles for the Environmental Protection Agency’s (EPA) Office of Enforcement and Compliance Assurance.
From January to October of 2010, Washakie generated more than 7.2 million renewable identification numbers (RINs) based upon its production of biodiesel at its Plymouth, Utah, facility. During that time period, however, Washakie did not produce any biodiesel - at the Plymouth facility or anywhere else. The biodiesel associated with the 7.2 million RINs would have accounted for a reduction of emissions equivalent to more than 30,000 metric tons of carbon dioxide.
The stipulation of settlement requires Washakie to pay a civil penalty of $3 million. In addition to the penalty, Washakie has already retired more than 7.2 million RINs by purchasing RINs from other parties. By doing this, Washakie tried to correct the problem it created by putting invalid RINs on the market. In order to protect the program's integrity and maintain a level playing field for regulated companies, EPA is pursuing enforcement actions against renewable fuel producers and importers that generated invalid RINs.
“The defendant made quite a profit by failing to adhere to the requirements of the Renewable Fuel Program regulations,” said Assistant Attorney General Cruden. “The penalty here sends the message that renewable fuel producers will be held accountable for meeting all legal requirements. The Department of Justice remains committed to taking the profit out of illegal activity.”
“This case is another example of the EPA’s commitment to maintain the integrity of the Renewable Fuel Standard program,” said Assistant Administrator Giles. “Making sure producers are supporting their claims with production of actual renewable fuels is critical to reducing greenhouse gas emissions that are fueling climate change.”
The Energy Independence and Security Act of 2007 expanded and strengthened the Renewable Fuel Program to encourage the blending of renewable fuels into the motor vehicle fuel supply of the U.S. and thereby reduce the nation’s dependence on foreign oil, help grow the renewable energy industry in the United States, and achieve significant greenhouse gas reductions. Authorized renewable fuels producers and importers could generate and attach credits – known as “renewable identification numbers” or “RINs” – to renewable fuels, such as biodiesel, that they produced or imported. Fossil fuel refiners and importers are obligated to obtain RINs each year according to the volume of fossil fuels that they put on the market. These “obligated parties” must purchase RINs or produce them themselves and they are responsible for the acquisition of valid RINs to meet their renewable fuel quotas. If transferred RINs are invalid, the transferees are liable for failing to satisfy their obligations. Because certain companies need RINs to comply with regulatory obligations, RINs have market value. A RIN is invalid if it incorrectly identifies, among other things, the production facility, or the type of fuel produced, or the volume of fuel produced and the regulations prohibit the transfer of invalid RINs.
Washakie registered with the EPA as a renewable fuel producer under the Renewable Fuel Regulations and identified its facility in Plymouth as a renewable fuel production facility. EPA initially discovered these violations during an inspection of Washakie’s Plymouth facility in 2010. EPA uncovered additional information concerning the violations in Washakie’s response to information requests and further investigation. There is no evidence that Washakie produced any biodiesel anywhere during the period covered by the complaint.
To read the settlement, or for more information about the case, visit: http://www2.epa.gov/enforcement/washakie-renewable-energy-llc-clean-air-act-settlement
For more information on the Renewable Fuel Standards, visit: http://www2.epa.gov/enforcement/civil-enforcement-renewable-fuel-standard-program
Two FCI Hazelton inmates sentenced for trafficking heroin into prisonRead the Press Release
CLARKSBURG, WEST VIRGINIA – Marcus Brown, 27, and Samuel Bynum, 24, both inmates at the Federal Correctional Institution at Hazelton, were convicted and sentenced in federal court today for their role in facilitating the shipment of quantities of heroin into the prison, United States Attorney William J. Ihlenfeld, II, announced.
An investigation by the Federal Bureau of Prisons and the FCI Hazelton Special Investigative Services Unit revealed that the defendants utilized telephone calls and emails to coordinate with another individual to use letters to ship quantities of heroin into the prison.
The defendants each pled guilty today to one count of “Use of Communication Facility to Commit, Cause & Facilitate Commission of a Drug Felony – Aiding and Abetting.” They were each sentenced to an additional six months in prison.
Assistant U.S. Attorney Shawn Morgan prosecuted the cases on behalf of the government.
U.S. District Judge Irene M. Keeley presided.