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1 May 2015
Mississippi man pleads guilty to assault at Fort PolkRead the Press Release
LAKE CHARLES, La. – United States Attorney Stephanie A. Finley announced that a man from Mississippi pleaded guilty to striking a man in the head with a baseball bat at the Fort Polk military base.
Justin Corey Thurston, 23, of McLain, Miss., entered a conditional guilty plea on Thursday before U.S. Magistrate Judge Kathleen Kay, to one count of assault with a dangerous weapon. The plea will become final when accepted by U.S. District Judge Patricia Minaldi. According to evidence presented at the guilty plea, Thurston visited the home of his estranged wife on September 6, 2014, at the Fort Polk military base. While at his wife’s residence, Thurston and his wife were involved in a physical altercation after she refused to give him her cell phone. Thurston then exited the house and struck a man in the head with the baseball bat.
Thurston faces up to 10 years in prison, three years supervised release and a $250,000 fine.
The U.S. Army Criminal Investigation Command and the FBI conducted the investigation. Assistant U.S. Attorneys David C. Joseph and Joseph T. Mickel are prosecuting the case.
Milwaukee Man Convicted in Federal Court for Hampton Service Center RobberyRead the Press Release
United States Attorney James L. Santelle announced today that Michael A. Anglin of Milwaukee (age: 24) was convicted in federal court following a four-day trial of: (1) interference with commerce by threats of violence also known as the Hobbs Act, in violation of 18 U.S.C. §1951; (2) discharge of a firearm in furtherance of a crime of violence in violation of 18 U.S.C. §924(c)(1)(A)(iii); (3) conspiracy in violation of 18 U.S.C. §1951; (4) felon in possession of a firearm in violation of 18 U.S.C. §922(g)(1); and (5) felon in possession of ammunition in violation of 18 U.S.C. §922(g)(1).
Anglin’s convictions are based on the December 9, 2013 robbery of Hampton Service Center, an auto repair shop. Two employees were in the store at the time of the robbery. During the course of the trial, one of the employee-victims testified that he was pistol whipped, shot in the abdomen, and the bullet severed his spine. The employee’s injuries resulted in him being hospitalized for two months, and at one point he feared that he would be paralyzed.
Anglin is facing a minimum of ten years’ incarceration based on his 18 U.S.C. 924(c)(1)(A)(iii) conviction. Anglin also faces a maximum of twenty years for the Hobbs Act conviction, twenty year maximum sentence for conspiracy, ten years maximum for felon in possession of a firearm, and a ten year maximum for felon in possession of ammunition. Under federal law, no term of imprisonment can run concurrently to Anglin’s conviction for 18 U.S.C. 924(c)(1)(A)(iii).
The Hobbs Act, passed by Congress in 1946, provides federal jurisdiction for cases involving violent, habitual criminals who commit armed robbery of businesses involved in interstate commerce.
This case was prosecuted by Assistant United States Attorneys Kelly B. Watzka and Jonathan H. Koenig. The investigation was conducted by the Milwaukee Police Department, U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Federal Bureau of Investigation.
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Members of Norteño Gang Vsp Sentenced for Racketeering Conspiracy, Accessory to Murder, Threats Against Witnesses, and RobberyRead the Press Release
SAN FRANCISCO – Three members and one associate of the Varrio South Park (VSP), a Norteño gang in Santa Rosa, Calif., were sentenced yesterday to federal prison for their participation in a racketeering conspiracy to commit violent crimes, announced United States Attorney Melinda Haag and Federal Bureau of Investigation Special Agent in Charge David J. Johnson.
Ruben Quiroz, 29, Samuel Tewolde, 32, and Cesar Castellanos, 31, were each sentenced to 10 years in prison. VSP leader David Martinez, 34, was sentenced to an 18-year prison term. These defendants, all Santa Rosa residents, were the last four out of the eight total defendants charged and sentenced in the case.
The case stems from a seventeen-count indictment returned by a federal grand jury on December 10, 2013. In the indictment, six members and an associate of the VSP were charged with conspiracy to commit violent crimes, including murder and assault with a dangerous weapon, in aid of racketeering; use of firearms in furtherance of crimes of violence; robbery affecting interstate commerce; narcotics trafficking; and witness tampering. According to the indictment, VSP members and associates agreed to conduct the affairs of the enterprise through, among other crimes, narcotics trafficking, witness intimidation, robbery, and murder. Also in the indictment are allegations that Andrew Hill-Piccola, not alleged to be a gang member or associate, violated federal laws prohibiting felons from possessing firearms.
All of the defendants charged in the racketeering conspiracy — Martinez, a/k/a “Oso,” a/k/a “Fat Boy,” a/k/a “Big Homie”; Quiroz; Castellanos, a/k/a “Cheese”; Tewolde; Kalin Carrel; Lucio Mendoza; and Edmund Deneiliom — pleaded guilty to conspiring to conduct the affairs of VSP through a pattern of racketeering, in violation of 18 U.S.C. § 1962(d). They also pleaded guilty to using firearms in furtherance of crimes of violence, in violation of 18 U.S.C. § 924(c). Martinez and Quiroz also pleaded guilty to conspiracy to commit a robbery affecting interstate commerce, in violation of 18 U.S.C. § 1951(a). Martinez also pleaded guilty to trafficking methamphetamine, in violation of 21 U.S.C. §§ 846, 841(a)(1) and (b)(1)(A). Defendants Tewolde and Castellanos pleaded guilty to separate counts of attempted murder in aid of racketeering, in violation of 18 U.S.C. § 1959(a)(5).
The acts upon which these convictions were based are wide-ranging. According to the indictment and plea agreements, on August 19, 2013, Martinez and Quiroz committed a robbery that resulted in a high-speed car chase during which they threatened victims with a firearm. On September 5, 2013, Tewolde fired shots in the parking lot of a restaurant in downtown Santa Rosa at a person whom he believed to have “snitched” against other members of VSP. On October 9, 2012, Castellanos shot at a fellow gang member whom Castellanos believed had challenged his status and authority within the gang. In addition, Castellanos pleaded guilty to a count of witness tampering related to his September 14, 2013, threat to kill a witness he believed would testify against Tewolde.
Defendants Deneiliom, Mendoza, and Carrell each pleaded guilty in prior proceedings to conspiring to conduct the affairs of VSP through a pattern of racketeering, in violation of 18 U.S.C. § 1962(d), and to using firearms in furtherance of crimes of violence, in violation of 18 U.S.C. § 924(c). Andrew Hill-Piccola, not charged with racketeering, pleaded guilty in a prior proceeding on charges he was a felon in possession of a firearm.
In sum, the punishments received by the defendants are as follows:
- David Martinez – 18 years
- Edmund Deneiliom – 11 years and 3 months
- Ruben Quiroz – 10 years
- Cesar Castellanos – 10 years
- Lucio Mendoza – 6 years and 6 months
- Samuel Tewolde – 10 years
- Kalin Carell – 6 years and 6 months
- Andrew Hill-Piccola – 3 years and 1 month.
The sentences were handed down by the Honorable William H. Alsup, U.S. District Judge. Judge Alsup also sentenced the defendants to five-year periods of supervised release each. Due to their association with Norteños, Judge Alsup also ordered the defendants not to associate with Norteño gang members or any other gang members during the period of their supervised release. All the defendants are currently in custody.
Assistant U.S. Attorneys Damali A. Taylor and Marc Price Wolf prosecuted the case with the assistance of Kurt Kosek, Kevin Costello, and Daniel Charlier-Smith. The prosecution is the result of an investigation by the Federal Bureau of Investigation’s North Bay Regional Gang Task Force, with the assistance of the Santa Rosa Police Department and the Sonoma County District Attorney’s Office.
Member of ‘Dirty Block’ Atlantic City, New Jersey, Gang Sentenced to 20 Years in Prison for Drug Conspiracy and Weapons ChargesRead the Press Release
CAMDEN, N.J. – An Atlantic City, New Jersey, man was sentenced today to 241 months in prison for his role in a criminal street gang that used threats, intimidation and violence to maintain control of the illegal drug trade in Atlantic City, U.S. Attorney Paul J. Fishman announced.
Kareem Bailey, 21 was previously convicted by a federal jury of conspiracy to distribute one kilogram or more of heroin, possession of firearms in furtherance of a drug trafficking crime, brandishing and discharging firearms in furtherance of the conspiracy and using a cellular telephone in furtherance of the conspiracy. Bailey, Terry Davis, 26, Lamar Macon, 26, and Dominique Venable, 25, all of Atlantic City, were each convicted following a six-week trial before U.S. District Judge Joseph E. Irenas, who imposed Bailey’s sentence today in Camden federal court.
According to documents filed in this case and the evidence presented at trial:
The four men were members of a gang known as “Dirty Block,” a/k/a “Crime Fam,” “3.6.6.12,” or “3.6,” which operated in a geographic area of Atlantic City that includes the public housing apartment complexes of Stanley Holmes Village and Schoolhouse Apartments.
The defendants participated in a violent street-level drug trafficking organization that controlled heroin sales through the possession of firearms and the use of gun violence, including at least one homicide and several non-fatal, drug-related shootings.
In addition to the prison term, Judge Irenas ordered Bailey to serve 10 years of supervised release. Davis, Macon, and Venable still await sentencing.
U.S. Attorney Fishman credited special agents of the FBI’s Newark Division, Atlantic City Resident Agency, under the direction of Special Agent in Charge Richard M. Frankel; the Atlantic County Prosecutor’s Office, under the direction of Prosecutor James P. McClain; the Atlantic City Police Department, under the direction of Chief Henry White; and the South Jersey Safe Streets Violent Incident and Gang (Safe Streets) Task Force, with the investigation leading to today’s sentence.
He also thanked the N.J. State Police; the Atlantic County Sheriff’s Office; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Northfield Police Department; the Vineland Police Department; the Brigantine Police Department; the Millville Police Department; the Mullica Township Police Department; the South Jersey Transportation Authority; and the U.S. Secret Service for their contributions.
The government is represented by Assistant U.S. Attorneys Patrick Askin and Justin Danilewitz of the U.S. Attorney’s Office in Camden and Special Assistant U.S. Attorney Edmund Burgos of the Atlantic County Prosecutor’s Office.
Defense Counsel: John Holliday Esq., Hamilton, New Jersey
Masterminds of International Sports Gambling Ring Find There's No Safe Bet, Plead GuiltyRead the Press Release
SAN DIEGO - Two leaders and one major bookmaker for an international gambling ring pleaded guilty today to a racketeering conspiracy that took millions of dollars in illegal sports wagers over the last decade in the San Diego and Los Angeles areas. Brothers Jan Harald Portocarrero and Erik Portocarrero admitted operating for years an internet and telephone gambling enterprise called “Macho Sports,” which engaged in illegal activities on nearly a daily basis from its headquarters in Lima, Peru, and throughout Southern California. Joseph Barrios, a bookmaker for Macho Sports, also pleaded guilty today and admitted that he recruited and managed various sub-bookies for the racketeering enterprise, directing the payment of winnings and collection of gambling debts – oftentimes using threats of force. The defendants also agreed to forfeit nearly $12 million in cash, real property and other assets seized from the illegal enterprise.
According to court documents, the FBI investigation of Macho Sports began in 2011, and employed wiretaps and undercover agents to infiltrate the organization and uncover the defendants’ illegal gambling and extortionate debt collection activities. Nearly two years ago, in coordinated law enforcement actions in Norway, Los Angeles, and San Diego, FBI agents and Norwegian police arrested 18 members of Macho Sports, and seized nearly $12 million in illegal assets. Macho Sports’ leaders, Jan Harald Portocarrero and Erik Portocarrero, were both arrested in June 2013, although they were half a world apart – Jan Portocarrero surrendered to authorities in Los Angeles, California, and Erik Portocarrero was arrested in Oslo, Norway. For the next 22 months Erik Portocarrero fought his extradition from Norway, but that legal battle ended on Wednesday when the Kingdom of Norway extradited him to the United States. Today, the Portocarreros and Barrios pleaded guilty before U.S. District Judge Janis L. Sammartino, who set sentencing hearings for Jan and Erik Portcarrero on August 7, 2015, and for Joseph Barrios on September 11, 2015. Erik Portcarrero also appeared today before Magistrate Judge Ruben B. Brooks, who denied his request for bond.
According to the superseding indictment and admissions in court, Jan Portocarrero and Erik Portocarrero started their illegal gambling business shortly after the 1995 Super Bowl. Although originally from California, the Portocarrero brothers set up Macho Sports in Peru after being investigated for gambling crimes in the Los Angeles area. Using the Internet and toll-free telephone lines, Macho Sports accepted high-stakes sports bets from customers throughout California. The organization ensured the prompt payment of gambling debts through, among other means, intimidation and a violent reputation as to its treatment of delinquent customers. The co¬ conspirators avoided detection by laundering their illegal proceeds and maintaining a company headquarters and physical platform outside the United States. The Portocarreros employed managers in Peru to oversee the enterprise’s telephone and internet operations, resolve disputes and adjust customers’ lines of credit. The organization also used teams of bookies—such as Amir Mokayef of La Jolla, California (who operated primarily in the San Diego area) and Joseph Barrios (who operated primarily in the Los Angeles area)—to recruit customers, pay off winning bets, and collect losing bets. Mokayef and Barrios, in turn, managed their own network of “sub-bookies” to recruit customers and collect payments. The enterprise also used “runners,” who dealt directly with customers and maintained thousands (and sometimes millions) of dollars in cash to handle customer payments and collections. Millions of dollars from these “banks” – which the conspirators kept in their homes and safe deposit boxes – were seized by authorities as part of the investigation.
The United States continues to pursue charges and forfeitures against Macho Sports International Corporation – the Panamanian entity allegedly used by the enterprise to conduct and legitimize its illegal gambling operation.
United States Attorney Duffy commented, “Although technology has made internet gambling more accessible, it is a mistake for criminals to believe that they can hide behind computer terminals in foreign countries. The United States and our international partners will use all means necessary to combat and disrupt such crimes, which too often are characterized by organized criminals, shady bookies, and actual acts of violence.
FBI Special Agent in Charge Eric S. Birnbaum commented, “Today’s convictions mark the end of a sophisticated international gambling criminal enterprise that preyed upon the gambling addiction of its customers. It also reaffirms the FBI’s commitment to working with our domestic and international law enforcement partners, integrating intelligence into our criminal investigations and dismantling sophisticated criminal enterprises such as Macho Sports.”
DEFENDANTS Case Number: 13CR2196-JLS Jan Harald Portocarrero (1) Age: 42 Los Angeles, California Erik Portocarrero (2) Age: 44 Oslo, Norway Joseph Barrios (4) Age: 49 Marina Del Rey, California CHARGESCount 1: Conspiracy to Conduct Racketeering Enterprise (RICO Conspiracy), in violation of Title 18, United States Code, Section 1962(d).
Maximum penalties: 20 years in prison, 3 years’ supervised release, $250,000 fine, and forfeiture of all proceeds generated from operating the racketeering enterprise.
INVESTIGATING AGENCIESFederal Bureau of Investigation
Manhattan U.S. Attorney Announces $60 Million Civil Fraud Settlement with Accredo Health Group over Kickback Scheme Involving Prescription DrugRead the Press Release
Accredo Admits to Conduct Regarding Its Distribution of Exjade
Preet Bharara, the United States Attorney for the Southern District of New York, Diego Rodriguez, the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and Scott J. Lampert, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General's New York Regional Office (“HHS-OIG”) announced yesterday a $60 million settlement of a civil fraud lawsuit against ACCREDO HEALTH GROUP (“ACCREDO”) concerning a kickback scheme with NOVARTIS PHARMACEUTICALS CORP. (“NOVARTIS”) involving the prescription drug Exjade. In addition to filing a Notice of Intervention against and Stipulation and Order of Settlement and Dismissal with ACCREDO, the Government has elected to intervene against NOVARTIS over the same conduct previously filed by a whistleblower. As alleged in the lawsuit, NOVARTIS provided kickbacks, in the form of patient referrals and related benefits, to ACCREDO in exchange for ACCREDO’s recommending refills to Exjade patients. In connection with the scheme, the defendants understated the serious and potentially life-threatening side effects of Exjade when promoting the drug’s benefits to patients.
Simultaneous with the filing of the Notice of Intervention against ACCREDO, U.S. District Judge Colleen McMahon approved a settlement to resolve the United States’ claims against ACCREDO. Under that settlement, ACCREDO (i) agrees to pay $45,060,598.87 to the United States; (ii) admits numerous facts concerning its relationship with NOVARTIS; and (iii) agrees to cooperate with the United States in the prosecution of the claims against NOVARTIS. ACCREDO has also agreed in principle to pay $14,939,401.13 to a group of states to settle the states’ claims based on the same alleged conduct. In January 2014, the Government entered into a multimillion dollar settlement with another codefendant, Bioscrip Pharmacy, for similar conduct.
Manhattan U.S. Attorney Preet Bharara said: “This is the second substantial settlement with an alleged co-conspirator of Novartis in connection with a scheme that used the lure of kickbacks to co-opt a healthcare provider’s independence. As alleged in our intervention papers, Novartis used Accredo to promote refills under the guise of purported ‘counseling’ and ‘education,’ and in doing so, Novartis caused patients to receive one-sided advice that did not discuss Exjade’s serious, potentially life-threatening, side effects. This settlement with Accredo restores to the public fisc tens of millions of dollars paid out for kickback-tainted drugs.”
FBI Assistant Director-in-Charge Diego Rodriguez said: “Drug companies are required by law to provide safe and effective medications for the sole purpose of healing the ailments of their patients. Likewise, pharmaceutical companies are prohibited from employing tactics that could improperly influence a provider’s decisions. Through its relationship with Novartis, Accredo Health Group acted in its own best interest. It set aside the needs of its patients and intentionally adjusted its practices in order to conceal information from consumers. This scheme also placed a hefty price tag on our Medicare and Medicaid programs, causing more than tens of millions of dollars to be spent on Exjade shipments. Today’s settlement demonstrates the government’s commitment to protect our citizens from this type of fraud and ensure everyone receives the quality medical care they need.”
HHS-OIG Special Agent in Charge Scott J. Lampert said: “The conduct displayed by Accredo compromised patient care and undermined the integrity of our nation's health care programs. This settlement should serve as a warning to all providers that choose to let financial inducements cloud their medical judgment.”
As alleged in the Government’s second amended Complaint and in the relator’s third amended Complaint, NOVARTIS markets and manufactures Exjade, an iron chelation drug approved for use by patients who have iron overload resulting from blood transfusions. For approximately five years until 2012, NOVARTIS orchestrated a scheme whereby it offered kickbacks, in the form of patient referrals and other benefits to certain specialty pharmacies, including ACCREDO and Bioscrip, in exchange for increasing their Exjade refills through biased recommendations to patients. ACCREDO and Bioscrip were part of a NOVARTIS-created exclusive distribution network for Exjade called the Exjade Patient Assistance and Support Services (“EPASS”), and through this network NOVARTIS was able to refer Exjade patients to particular pharmacies within the network.
In particular, the Government has elected to intervene in the relator’s third amended Complaint with respect to its allegations concerning NOVARTIS and ACCREDO’s participation in an Exjade patient referral allocation scheme through which NOVARTIS gave ACCREDO additional patient referrals and related benefits in return for ACCREDO achieving the highest refill percentage for Exjade patients as compared to the refill percentages among Exjade patients at the other two pharmacies in the closed distribution network that NOVARTIS had established for Exjade.
As part of its settlement with the United States, ACCREDO made extensive factual admissions, including that:
- ACCREDO was one of three specialty pharmacies permitted to dispense Exjade as part of EPASS, NOVARTIS’s distribution network for Exjade.
- NOVARTIS controlled how many of the patient prescriptions received by EPASS were distributed among ACCREDO and the other two EPASS pharmacies.
- In June 2007, NOVARTIS began issuing monthly “Exjade Scorecards” to the EPASS pharmacies that measured, among other things, the pharmacies’ “adherence” scores. Based on discussions with NOVARTIS, ACCREDO knew that the “adherence” scores in the Exjade Scorecards were designed to show how long ACCREDO’s Exjade patients continued to order refills. ACCREDO also knew that, in calculating the adherence scores, NOVARTIS did not exclude patients who stopped ordering refills due to side effects or patients who were directed to stop therapy by their physicians.
- In late 2007 and early 2008, NOVARTIS indicated to ACCREDO that NOVARTIS was dissatisfied with ACCREDO’s performance in terms of its “adherence” scores in the Exjade Scorecards. NOVARTIS executives asked ACCREDO executives to implement an Exjade adherence improvement plan that involved additional nurse intervention. NOVARTIS executives also told ACCREDO that ACCREDO could lose undesignated patient referrals from EPASS if it continued to lag behind other EPASS pharmacies in the Exjade Scorecards.
- At a meeting in March 2008 with ACCREDO, a NOVARTIS executive made statements emphasizing the importance to NOVARTIS of ACCREDO’s adherence performance. Later that month, NOVARTIS told ACCREDO that NOVARTIS was formulating a plan to allocate undesignated patient referrals to the EPASS pharmacies based on their rankings in the Exjade Scorecards. Specifically, the EPASS pharmacy with the top adherence score in the Exjade Scorecards would receive a larger share of the undesignated patient referrals as compared to the other EPASS pharmacies. In addition, between April and June 2008, NOVARTIS managers told ACCREDO that ACCREDO’s performance in the Exjade Scorecards was below NOVARTIS’s expectation and this affected NOVARTIS’s ability to meet its sales targets for Exjade.
- In July 2008, NOVARTIS executives reiterated in statements to ACCREDO that NOVARTIS was dissatisfied with ACCREDO’s performance in relation to Exjade. Later that month, ACCREDO hired a new nurse for Exjade and assigned that nurse to make a sequence of calls to each Exjade patient.
- In making calls to Exjade patients, the nurse at ACCREDO was supposed to follow a set of call protocols that ACCREDO had developed. ACCREDO’s 2008 call protocols directed the nurse to tell patients that compliance with Exjade therapy regimen is extremely important and that, if untreated, iron overload could result in arthritis, liver or heart problems, high blood sugar, persistent abdominal pain, severe fatigue, and skin discoloration. With regard to adverse reactions, ACCREDO’s 2008 Exjade call protocols directed the nurse to advise patients about Exjade’s common adverse reactions, including diarrhea, abdominal pain, fever, and rash, but not the less common, but more severe, adverse reactions like renal or hepatic impairment.
- In October 2008, NOVARTIS informed ACCREDO about, and ACCREDO agreed to, a new patient referral allocation plan that NOVARTIS had formulated. Under that plan, NOVARTIS would allocate 60 percent of all undesignated patient referrals to the EPASS pharmacy with the top “adherence” scores in the Exjade Scorecards and allocate 20 percent of the undesignated patient referrals to each of the other two EPASS pharmacies.
- In February 2009, an Exjade executive from NOVARTIS visited ACCREDO and met with the Exjade nurse at ACCREDO. During that meeting with the NOVARTIS executive, the Exjade nurse at ACCREDO described how she handled calls with Exjade patients.
- In January 2010, the FDA required NOVARTIS to add a “black box warning” to the Exjade label to highlight that Exjade may cause renal impairment (including renal failure), hepatic impairment (including hepatic failure), and gastrointestinal hemorrhage. The FDA-mandated warning also stated that these reactions were fatal in some reported cases.
- After January 2010, no representative of NOVARTIS asked or suggested to ACCREDO that its Exjade call protocols should be revised to require the Exjade nurses to discuss the serious risks listed in Exjade’s “black box warning” when they called patients to discuss Exjade therapy.
- In February 2010, ACCREDO updated its Exjade call protocols. In terms of the adverse reactions for Exjade, the February 2010 ACCREDO Exjade call protocols continued to direct the Exjade nurses to advise patients about the common adverse reactions, such as diarrhea and rash, but not the less common, but more severe, adverse reactions discussed in the “black box warning,” such as renal or hepatic failure. As revised, the February 2010 Exjade call protocols directed the nurses to tell Exjade patients that “compliance with Exjade is very important in order to prevent the following complications that result from untreated iron overload: arthritis, high blood sugar, persistent abdominal pain, severe fatigue, skin discoloration, stroke, or death.”
- In early 2010, NOVARTIS notified ACCREDO that, under the plan they agreed on in 2008, ACCREDO would receive additional undesignated patients because ACCREDO had obtained the top adherence score in the Exjade Scorecards in the fourth quarter of 2009. Specifically, based on communications with NOVARTIS, it was ACCREDO’s understanding that it was entitled to receive 60 percent of all undesignated patients in the second, third, and fourth quarters in 2010, and for all four quarters in 2011.
- In late March 2012, NOVARTIS notified ACCREDO that, starting in April 2012, it would stop allocating additional Exjade patient referrals to the EPASS pharmacy with the highest Exjade Scorecard ranking, as NOVARTIS and ACCREDO had agreed to in October 2008.
- One month later, in April 2012, ACCREDO stopped assigning nurses to call Exjade patients to discuss their Exjade therapy.
The Government seeks treble damages and penalties under the False Claims Act for the tens of millions of dollars in reimbursements that Medicare and Medicaid paid for Exjade shipments that resulted from the kickback scheme involving NOVARTIS and ACCREDO.
The allegations of fraud stated in the Complaint were first brought to the attention of federal law enforcement by David Kester, the whistle-blower who filed a lawsuit under the False Claims Act. The False Claims Act permits the Government to recover up to three times the amount of damages incurred by the United States, plus civil penalties ranging from $5,500 to $11,000 per violation. Private parties who have knowledge of fraud committed against the Government may file suit on behalf of the Government and share in any recovery. The United States may then intervene and file its own lawsuit for treble damages and penalties, as it did in this case.
Mr. Bharara praised the investigative work of the, HHS-OIG, and the Medicaid Fraud Control Units for New York, Washington, California, and Ohio. He also thanked the Commercial Litigation Branch of the U.S. Department of Justice’s Civil Division in Washington, D.C., for its assistance in this case.
The case is being handled by the Office’s Civil Frauds Unit. Mr. Bharara established the Civil Frauds Unit in March 2010 to bring renewed focus and additional resources to combating healthcare and other types of frauds. Assistant U.S. Attorneys Li Yu, Rebecca C. Martin, David J. Kennedy, Jeffrey K. Powell, and Peter Aronoff are in charge of the case.
Macon Drug Dealer Sentenced for Possession of Cocaine with Intent to DistributeRead the Press Release
Michael J. Moore, United States Attorney for the Middle District of Georgia, announced that, Victor Burnett, aged 33, of Macon, Georgia, was sentenced on April 28, 2015 to serve 7 years (84 months) in federal prison for possession with intent to distribute cocaine. The sentence was handed down by U.S. District Court Judge Marc T. Treadwell in Macon, Georgia.
Mr. Burnett pled guilty to the charge on January 21, 2015. As part of his plea, he admitted that he had a cocaine supplier in Atlanta, Georgia who supplied him with kilogram quantities of cocaine. Once obtained, Mr. Burnett transported the cocaine to Macon, Georgia for sale and distribution. On July 4, 2012, surveillance officers observed Mr. Burnett as he traveled to Hartsfield International Airport in Atlanta and took delivery of 1718 grams of powder cocaine which he then transported to Macon, Georgia with the intent to distribute it. A search of the vehicle revealed over $18,000 in currency in addition to the cocaine.
“Cocaine is not a problem of the past. It continues to pollute our streets because of drug dealers like Mr. Burnett. We are committed to doing whatever it takes to get these drugs off the streets, even if that means that we lock up the dealers one at a time,” said U.S. Attorney Michael Moore.
U.S. Postal Inspector in Charge Thomas L. Noyes II stated, “The U.S. Postal Inspection Service aggressively investigates cases involving the misuse of the U.S. mail system by criminals who traffic illegal contraband such as narcotics and financial proceeds. This case demonstrates the success of State and Federal agencies collaborating to bring offenders to justice.”
Mr. Burnett’s arrest was the result of a joint investigation conducted by agents with the Georgia Bureau of Investigation (GBI), Drug Enforcement Administration (DEA) and U.S. Postal Inspection Service (USPIS). Assistant United States Attorney Charles Calhoun prosecuted the case for the Government.
Questions concerning this case should be directed to Pamela Lightsey, Public Information Officer, United States Attorney’s Office, at (478) 621-2603.
Lincoln Man Sentenced for Distribution of MethamphetamineRead the Press Release
United States Attorney Deborah R. Gilg announced that on May 1, 2015, Gabriel Alonso Ruelas-Lugo, 30, of Lincoln, was sentenced to 70 months in prison for distribution of 50 grams or more of methamphetamine. He was ordered to serve four years on supervised release following the prison term.
On September 11, 2014, Ruelas-Lugo sold 56.83 grams (approximately two ounces) of methamphetamine to an undercover officer working with the Lincoln/Lancaster County Drug Task Force in Lincoln. The officer asked Ruelas-Lugo if the officer could obtain an additional two ounces of methamphetamine, and Ruelas-Lugo agreed, telling the officer to meet with him again in approximately half an hour. At the second meeting, Ruelas-Lugo delivered an additional 56.24 grams of methamphetamine to the undercover officer. Testing indicated that the methamphetamine was over 95% pure. Ruelas-Lugo had made eight prior deliveries to the undercover officer between December of 2013 and August of 2014. Each of those sales involved approximately one ounce of a substance which tested positive for methamphetamine.
This case was investigated by the Lincoln/Lancaster County Drug Task Force.
Lexington Man Pleads Guilty to Money Laundering Charge Using BitcoinRead the Press Release
Contact Person: DeWayne Pearson (803) 929-3000
Columbia, South Carolina ---- United States Attorney Bill Nettles stated today that Joseph Patrick Gelli age 23 of Lexington has entered a plea of guilty to conspiracy to commit money laundering in violation of Title 18, United States Code, Section 1956. According to facts presented during the guilty plea hearing, Gelli was involved in trafficking illegal drugs through the use of Bitcoin, an internet based money system. Gelli used bitcoins to purchase marijuana and psychotropic mushrooms from illegal websites located on “the deep web”, a section of the internet not accessible through common search engines like Google or Yahoo. Gelli had the illegal drugs delivered to his home and then he would distribute the illegal drugs to his customers. A search of Gelli’s home revealed a variety of illicit drugs and $38,000 in cash. Sentencing in the case has not yet been scheduled, but Gelli faces a maximum penalty of twenty years of imprisonment and a fine of $500,000.
Thomas J. Holloman, III Special Agent in Charge, IRS Criminal Investigation said, "Mr. Gelli’s criminal activities involved the laundering of specified unlawful activity using Bitcoin, a virtual currency that can be used in a wide variety of crimes involving tax fraud, money laundering, and other financial crimes. IRS-CI will continue to focus on financial crimes that involve virtual currency by collaborating with FinCEN, its internal business units and other federal law enforcement agencies to identify the movement of illegal monies utilizing virtual currency.”
The case was investigated by Special Agents with the Internal Revenue Service and the Lexington County Sheriff’s Department. The case was prosecuted by Assistant United States Attorney T. DeWayne Pearson of the Columbia office.
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Lawrence Man Sanctioned for Failing to Appear for Tsarnaev Jury Selection ProcessRead the Press Release
BOSTON – A Lawrence man was first lambasted by the Court and then sanctioned yesterday for his failure to appear for the final rounds of jury selection in the United States v. Tsarnaev matter.
After an evidentiary hearing on Thursday afternoon, U.S. District Court Judge William G. Young found that prospective juror Jose Gutierrez intentionally violated his obligation to serve as a juror under federal law. In particular, the court found that Gutierrez intentionally skipped jury service on March 3, 2015, in order to go to work. The Court also found that Gutierrez had proper and timely notice that he was to appear for jury duty that morning. His unexcused absence caused significant disruption to the jury selection process in a criminal trial that day. The Court concluded that Gutierrez’s conduct violated federal law relating to compliance with jury service responsibilities.
In discussing the appropriate sanction, Judge Young reminded Gutierrez that jurors, like judges, serve as “constitutional officers” during their term of service, and that serving on a jury is not only an obligation but a constitutional right. Citing the more than 1300 other persons who complied with their obligation to appear in the Tsarnaev matter, Judge Young told Gutierrez that he should “be ashamed” of his decision not to appear, particularly because Gutierrez was the only one to fail to appear as called without providing advance notice and a valid reason. Judge Young then imposed a fine of $400 and ordered Gutierrez to participate in 40 hours of community service.
“Juries are the cornerstone of our criminal justice system,” said United States Attorney Carmen M. Ortiz. “Jury service is both a right and an obligation of every citizen. When called, we must serve.”
U.S. Attorney Ortiz made the announcement today. The matter was handled by Assistant U.S. Attorneys Giselle J. Joffre and Justin D. O’Connell of Ortiz’s Civil Division.
Las Vegas Man Sentenced to 40 Years in Prison for Sex TraffickingRead the Press Release
Prostituted Two Teenage Girls in Virginia, Utah, and California
ALEXANDRIA, Va. – Lenny Paul Haskins, 34, also known as “2 Much,” of Las Vegas, Nevada, and Richmond, California, was sentenced today to 40 years in prison, followed by a life term of supervised release, for sex trafficking of a child. The court also ordered Haskins to pay $538,250 in restitution to the victims and to forfeit $738,250 to the United States.
Haskins pleaded guilty on January 8, 2015. According to court documents, since at least 2005, Haskins has been a pimp and has derived his income primarily from prostituting women and girls in numerous cities and states. By 2012, Haskins was regularly prostituting victims in northern Virginia. The United States discovered 17 women and girls who were prostituted by Haskins in the past few years. Two of the victims were less than 18 years old, and one was only 15 years old. When recruiting women and girls to prostitute, Haskins frequently would fail to mention that he would take all or nearly all of the money that these women would earn from prostitution. Haskins typically made false promises to the women and girls whom he prostituted.
Haskins frequently provided drugs to the women and girls whom he prostituted and some of the women and girls prostituted by Haskins were or became addicted to drugs.
Haskins instructed the women and girls whom he prostituted to call him “daddy.” Some of the women prostituted by Haskins were tattooed with Haskins’s moniker: “2 Much.” Haskins sometimes isolated women and girls whom he prostituted from their families and from each other as a means of preventing them from leaving Haskins.Haskins obtained sex customers for the women and girls he prostituted by posting advertisements on Internet sites such as Backpage.com, Eros.com, Cityvibe.com, and MyRedBook.com. Thousands of customers called the listed telephone numbers to arrange to perform commercial sex acts with the women and girls prostituted by Haskins.
Haskins set a monetary quota that the victims whom he prostituted were required to meet each day. For example, in some places, Haskins required these women and girls to earn $1,000 per day from prostitution, and provide him with these proceeds. When Haskins was incarcerated, he continued to run his prostitution business from jail.
Around June 2014, two minor victims encountered Haskins at a hotel around Sacramento, California, where they were prostituting. Both were runaways from foster care. Haskins provided marijuana to them and eventually recruited them to work for him. Haskins prostituted them in California, Utah, and Virginia.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Andrew G. McCabe, Assistant Director in Charge of the FBI’s Washington Field Office; and Colonel Edwin C. Roessler, Jr., Chief of the Fairfax County Police Department, made the announcement after sentencing by U.S. District Judge Claude M. Hilton.
This case was investigated by the FBI’s Washington Field Office and the Fairfax County Police Department. Assistant U.S. Attorney Michael J. Frank is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:14-CR-432.
Ken Nangauta Sentenced to 12 Months PrisonRead the Press Release
ALICIA A.G. LIMTIACO, United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that KEN NANGAUTA, age 51, of Merizo, was sentenced today before Senior Judge Alex R. Munson, in the District Court of Guam, to 37 months imprisonment with credit for time served, three years supervised release and 200 hours community service.
Defendant NANGAUTA pled guilty on June 2, 2014, to Conspiracy to Distribute Methamphetamine. NANGAUTA received two packages containing ice from Las Vegas, Nevada, with the combined weight of 151 grams. He also sent money to Eder Cortez-Zelaya in Las Vegas, Nevada, to pay for the ice on behalf of his co-defendant David Quinata.
U.S. Attorney Limtiaco stated, “Our community is not immune from the poison of methamphetamine. This case illustrates the hard work our partners in law enforcement do every day to stop the distribution of methamphetamine into Guam. This conviction resulted from the concerted efforts of law enforcement partners in the OCDETF investigation, a focused multi- agency, multi-jurisdictional task force investigating and prosecuting the most significant drug trafficking organizations throughout the United States by leveraging the combined expertise of federal, state and local law enforcement agencies.”
This OCDETF investigation involved federal agents and local law enforcement officers of the U.S. Postal Inspection Service (USPIS), Drug Enforcement Administration (DEA), U.S. Department of Homeland Security Investigations (HSI), Guam Police Department (GPD), Guam Customs and Quarantine Agency (GCQA), Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF), U.S. National Oceanic Atmosphere Administration (NOAA), and U.S. Coast Guard Criminal Investigative Service (CGIS). The case was prosecuted by Assistant U.S. Attorney Clyde Lemons, Jr.
Justice Department Announces $20 Million in Funding to Support Body-Worn Camera Pilot ProgramRead the Press Release
The Department of Justice today announced a $20 million Body-Worn Camera (BWC) Pilot Partnership Program to respond to the immediate needs of local and tribal law enforcement organizations. The investment includes $17 million in competitive grants for the purchase of body-worn cameras, $2 million for training and technical assistance and $1 million for the development of evaluation tools to study best practices. The pilot program is part of President Obama’s proposal to invest $75 million over three years to purchase 50,000 body-worn cameras for law enforcement agencies.
“This body-worn camera pilot program is a vital part of the Justice Department’s comprehensive efforts to equip law enforcement agencies throughout the country with the tools, support, and training they need to tackle the 21st century challenges we face,” said Attorney General Loretta E. Lynch. “Body-worn cameras hold tremendous promise for enhancing transparency, promoting accountability, and advancing public safety for law enforcement officers and the communities they serve.”
Administered by the Bureau of Justice Assistance (BJA) under the Justice Department’s Office of Justice Programs (OJP), the BWC pilot program will provide support to help law enforcement agencies develop, implement and evaluate body-worn camera programs across the United States.
“Body-worn camera technology is a valuable tool for improving police-citizen relationships,” said Director Denise O’Donnell of the Bureau of Justice Assistance. “BJA is committed to helping law enforcement agencies identify the safest and most effective methods for deploying this technology and addressing factors such as privacy, archiving and legal regulations surrounding its use. BJA stands by to guide agencies through what can be a complex process toward more successful adoption of the technology.”
The Justice Department expects to provide 50 awards to law enforcement agencies, with about one-third of the grants directed toward smaller law enforcement agencies. The grants, which require a 50/50 in-kind or cash match, can be used to purchase equipment but applicants must establish a strong plan for implementation of body-worn cameras and a robust training policy before purchasing cameras. The long term costs associated with storing this information will be the financial responsibility of each local agency.
Another $2 million will fund a national BWC Training and Technical Assistance provider through a competitive process, to assist agencies developing and enhancing their BWC programs. This training and technical assistance will provide support to law enforcement agencies to support successful implementation of their body-worn camera programs.
OJP’s Bureau of Justice Statistics (BJS) will receive $1 million of the funds to collect data on body-worn camera usage through surveys of law enforcement agencies. BJS will also design data collection forms that can be used in future surveys of prosecutors and public defenders to measure how body-worn camera footage is being used by the courts in criminal cases.
BJA will launch a BWC Implementation Toolkit in May, designed as an online resource for stakeholders. The toolkit will focus on implementation requirements, retention issues, policy concerns, interests of prosecutors, victim and privacy advocates’ concerns, along with community engagement and funding considerations.
For additional information about the BWC Pilot Implementation Program, visit this website: http://go.usa.gov/3BtMW.
Body-Worn Camera Fact Sheet
Jury Convicts Businessmen of International Fraud SchemeRead the Press Release
Jacksonville, Florida – United States Attorney A. Lee Bentley, III announces that a federal jury has found Mitchell Holland (52, San Diego, CA), Warren Rosenfeld (60, Plano, TX), and Rondell Scott Hedrick (50, Lexington, NC) guilty of multiple counts of wire fraud. Holland was convicted on nine counts, Rosenfeld was convicted on four counts, and Hedrick was convicted on three counts. Each faces up to 20 years in prison on each count.
According to evidence presented during the 12-day trial, beginning in mid-2009, when bank lending was very limited due to the economy, Rosenfeld, Holland, Hedrick, and others promoted themselves as specialists in securing and using alternative financing. During that time, individuals throughout the country contacted Holland concerning his ability to arrange for alternative capital financing through his company, Vital Funds, Inc. Holland claimed that he could arrange for a New Zealand Finance Company (Unistate Investments Savings and Loan Limited) to fund a leased Certificate of Deposit at a branch of Chase Manhattan Bank in the British West Indies. Such a bank did not exist.
The individuals seeking financing were then referred to Hendrick, who would offer to assist in liquidating the leased Certificate of Deposit. In one instance, Hedrick offered a victim in Jacksonville the opportunity to purchase a banking passport that would permit oversees banking with fewer restrictions. Hedrick had no such ability to obtain the banking passport, and simply stole the individual’s $29,000.
Rosenfeld, via his corporation, Aster Capital, Inc., represented himself as an individual who reviewed contract documents for Holland and Vital Funds in a quasi-attorney role. Rosenfeld later removed his company’s label from various contract documents and Holland and Vital Funds became the main point of contact for the clients seeking alternative financing (Leased Certificates of Deposit, Standby Letters of Credit, Proof of Funds Accounts, and Verifications of Deposit). Rosenfeld prohibited the brokers from allowing the clients to contact him.
Rosenfeld (Aster Capital), Holland (Vital Funds), and Unistate representatives split the initial account arrangement fees provided to an escrow company by the clients. These fees ranged from $300,000 to $625,500. None of the deals ultimately closed, and the clients failed to receive funding or real access to any funded account.
During the scheme, clients lost approximately $9.2 million. Holland and Rosenfeld profited in excess of $1.2 million. The remainder of the money was spread among Unistate representatives, and other brokers/participants.
Unistate Director Juan Hernandez has been charged for his role in this case, but remains a fugitive. Unistate representative Christopher Jaijairam (55, Yonkers, NY), and Glen Elliott Smith (40, New Orleans, LA) previously pleaded guilty for their roles in this scheme. Sentencing hearings for the defendants in this case have not yet been set.
The case was investigated by the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorney A. Tysen Duva.
Joe Davy Benavente, Jr. Sentenced TodayRead the Press Release
ALICIA A.G. LIMTIACO, United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that JOE DAVY BENAVENTE, JR., age 30, of Merizo, was sentenced today before Senior Judge Alex R. Munson, in the District Court of Guam, to six months home confinement with credit for time served, four years supervised release, 200 hours community service and a drug rehabilitation program approved by the U.S. Probation Office.
Defendant BENAVENTE was charged with and pled guilty to conspiracy to distribute more than 5 grams of methamphetamine (ice). BENAVENTE sent money on behalf of co-defendant David Quinata to Eder-Cortez Zelaya in Las Vegas to pay for ice.
U.S. Attorney Limtiaco stated, “Our community is not immune from the poison of methamphetamine. This case illustrates the hard work our partners in law enforcement do every day to stop the distribution of methamphetamine into Guam. This conviction resulted from the concerted efforts of law enforcement partners in the OCDETF investigation, a focused multi- agency, multi-jurisdictional task force investigating and prosecuting the most significant drug trafficking organizations throughout the United States by leveraging the combined expertise of federal, state and local law enforcement agencies.”
This OCDETF investigation involved federal agents and local law enforcement officers of the U.S. Postal Inspection Service (USPIS), Drug Enforcement Administration (DEA), U.S. Department of Homeland Security Investigations (HSI), Guam Police Department (GPD), Guam Customs and Quarantine Agency (GCQA), Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF), U.S. National Oceanic Atmosphere Administration (NOAA), and U.S. Coast Guard Criminal Investigative Service (CGIS). The case was prosecuted by Assistant U.S. Attorney Clyde Lemons, Jr.
Iowa Couple Pleads Guilty to Sex Trafficking by Force, Fraud, or CoercionRead the Press Release
Defendants admit to torturing and prostituting a woman
RICHMOND, Va. – Aldair Hodza, 36, and Laura Sorensen, 31, of Clive, Iowa, pleaded guilty today to charges of Sex Trafficking by Force, Fraud, or Coercion, and Interstate Transportation of a Person for Prostitution.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Adam S. Lee, Special Agent in Charge of the FBI’s Richmond Division, made the announcement after the plea was accepted by U.S. District Judge Henry Hudson.
Hodza and Sorensen, who were indicted by a federal grand jury on March 3, 2015, face a mandatory-minimum term of 15 years in prison and a maximum of life in prison when they are sentenced on August 14, 2015. As set forth in the plea agreement, the United States and the defendants have agreed to recommend a sentence of 35 years imprisonment on Count One and 10 years on Count Two to run concurrently. This recommendation is not binding on the court. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
In a statement of facts filed with the plea agreement, the defendants admitted that on December 19, 2014, they convinced the victim to join them in their recreational vehicle (“RV”) using a ruse. When the victim arrived, the defendants took her phone, forced her to consume alcohol and marijuana, and sexually assaulted her. The defendants then told the victim that she was not free to leave and forced her to prostitute for the next several days. Sorensen and Hodza worked together to post advertisements on Craigslist soliciting the victim for sexual acts and arrange meetings for the victim to perform sexual acts for money. Sorensen collected all of the money paid for these sexual acts for use by Sorensen and Hodza.
On December 24, 2014, the defendants began their trip to Virginia to visit Hodza’s minor daughter, forcing the victim to come with them. The defendants attempted to prostitute the victim along the trip at various truck stops. Upon arriving in Virginia several days later, they went to campgrounds in Virginia and North Carolina, where they continued to force the victim to engage in prostitution. During this time, the defendants engaged in a pattern of torture and sexual abuse toward the victim, including burning the victim on her back and abdomen with a key and scissors that had been heated on the stove, putting cigarettes out on the victim’s body, whipping the victim with a rope, driving nails into the victim’s feet, and spraying bleach into the victim’s wound.
On January 6, 2015, New Kent County Sheriff’s Deputies and Virginia State Police troopers responded to a call at a gas station in Providence Forge, Virginia after a call by a concerned truck driver who observed suspicious behavior at the RV. Upon arriving, the officers entered the RV and observed the victim displaying signs of fright and malnourishment and removed her from the RV to speak with her alone. The victim then told them that she was being held against her will and abused by the defendants.
This case was investigated by the Federal Bureau of Investigation. Assistant U.S. Attorneys Heather L. Hart, Dominick S. Gerace, and Angela Mastandrea-Miller are prosecuting the case on behalf of the United States.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:15-cr-032.
International Competition Network Adopts Guidance on Investigative Process to Enhance Procedural Fairness in Competition Cases and Cooperation in International Merger EnforcementRead the Press Release
At its annual meeting, the International Competition Network (ICN) adopted guidance on investigative process in competition cases and approved new work on international merger enforcement cooperation, legal theories in tying and bundling investigations and interaction with government procurement agencies, the Department of Justice’s Antitrust Division announced today.
The 14th annual ICN conference, hosted by the Australian Competition and Consumer Commission (ACCC), was held from April 28-May 1, 2015, in Sydney, Australia. Over 500 delegates participated, representing more than 70 antitrust agencies from around the world, and included competition experts from international organizations and the legal, business, consumer and academic communities. Assistant Attorney General Bill Baer of the Department of Justice’s Antitrust Division and Federal Trade Commission Chairwoman Edith Ramirez led the U.S. delegation. The conference showcased the achievements of ICN working groups on cartels, competition agency effectiveness, unilateral conduct, mergers and competition advocacy.
“ICN is an important forum for collaboration with our counterpart agencies around the world,” said Assistant Attorney General Baer. “Cooperation with other jurisdictions makes our own enforcement stronger, particularly in a globalized economy where the number of companies operating in multiple jurisdictions continues to rise and there is a greater risk that anticompetitive transactions or conduct in one jurisdiction will harm consumers in other parts of the world.”
Assistant Attorney General Baer spoke on a panel about international cooperation in cartel enforcement. The Cartel Working Group, co-chaired by the Antitrust Division, showcased new work on cooperation with procurement agencies and how to build constructive relationships to ensure free and fair competition in public bidding procedures.
“The ICN’s guidance on investigative process is an important step as agencies strive to be effective in promoting competition and protecting consumers,” said Chairwoman Ramirez. “Good investigative process leads to better agency decision making, protects the procedural rights of parties and bolsters the legitimacy of competition enforcement.”
The Agency Effectiveness Working Group, co-chaired by the FTC, addresses competition agency strategy, operations and investigative procedures. The working group developed ICN guidance on investigative process to promote fair and informed enforcement across all institutional frameworks and all competition enforcement areas. The guidance is based on a broad consensus among ICN members regarding the importance of transparency, engagement between agencies and parties and the protection of confidential information during investigations. It represents the most comprehensive agency-led effort to articulate guidance on investigative principles and practices that promote procedural fairness and effective enforcement. The working group also presented new on-line training modules on effective interviewing during the course of a competition investigation.
Chairwoman Ramirez participated in the Unilateral Conduct Working Group’s plenary discussion of unilateral conduct in the new economy and optimal enforcement to promote innovation. The working group promotes convergence and sound enforcement of laws governing conduct by firms with substantial market power. This year, it presented a new workbook chapter on tying and bundling as part of a practical guide to the investigation of various types of unilateral conduct.
The Merger Working Group presented a practical guide to international enforcement cooperation. It is intended to promote interagency cooperation, including for parties and third parties that seek to facilitate cooperation. The guide identifies the benefits and basic principles of enforcement cooperation such as consistent outcomes, efficient investigations, flexibility and independent agency decision making. It then highlights cooperation practices on timing alignment, information sharing, analysis and remedies. This initiative furthers the working group’s mission to promote the adoption of best practices in the design and operation of merger review laws.
To promote implementation of the ICN Recommended Practices on Competition Assessment adopted at the 2014 ICN Annual Conference, the Advocacy Working Group presented a framework of examples of the roles that competition agencies play in evaluating the effects on competition of a proposed or existing law or regulation. The working group also presented a report on developing an effective competition culture.
In 2014-2015, the ACCC led a special project devoted to the treatment of on-line vertical restraints under competition law and produced a comparative report, based on responses to a survey from 47 ICN member agencies. The report was presented in a plenary session and discussed at the conference.
The ICN was created in October 2001, when the Department of Justice and the FTC joined antitrust agencies from 13 other jurisdictions to increase understanding of competition policy and promote convergence toward best practices around the world. The ICN now comprises 132 member agencies from 119 jurisdictions.
More resources are available on the ICN website (link is external).
Information: Federal Court ArraignmentsRead the Press Release
The United States Attorney’s Office announced that those persons listed below were arraigned before the U.S. Magistrate and the indictments handed down by the Grand Jury unsealed.
Appearing before U.S. Magistrate Judge Ostby in Billings on April 30, 2015, and entering pleas of Not Guilty were:
- CAROLANN CHAVIS, a 26-year-old resident of Lodge Grass, appeared on charges of assault resulting in substantial bodily injury. If convicted of the most serious charges contained in the indictment, CHAVIS faces 5 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the Federal Bureau of Investigation. PACER Case Reference. 15-40
- TOMAS ALEXANDER DELAO, a 31-year-old resident of Billings, appeared on charges of possession with intent to distribute methamphetamine. If convicted of the charge contained in the indictment, DELAO faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by the Federal Bureau of Investigation, Big Sky Safe Streets Task Force and Eastern Montana HIDTA. PACER Case Reference. 15-42
Appearing before U.S. Magistrate Judge Ostby in Billings on April 29, 2015, and entering pleas of Not Guilty were:
- ZACHARY KYLE AMERICAN HORSE, a 20-year-old resident of Lame Deer, appeared on charges of assault resulting in serious bodily injury and assault with a dangerous weapon. If convicted of the most serious charge contained in the indictment, AMERICAN HORSE faces 10 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the Bureau of Indian Affairs and the Federal Bureau of Investigation. PACER Case reference. 15-23
Appearing before U.S. Magistrate Judge Johnston in Great Falls on April 28, 2015, and entering pleas of Not Guilty were:
- CHERYL LYNN HEAVY RUNNER, a 52-year-old resident of Browning, appeared on charges of theft of federally provided welfare benefits by fraud and federal welfare assistance fraud. If convicted of the most serious charge contained in the indictment, HEAVY RUNNER faces10 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by U.S. Department of Health and Human Services Office of Inspector General. PACER Case Reference. 15-24
- MARCELLE HELENE PEPION, a 58-year-old resident of Browning, appeared on charges of theft of federal provided welfare benefits by fraud and federal welfare assistance fraud. If convicted of the most serious charge contained in the indictment, PEPION faces 10 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by U.S. Department of Health and Human Services Office of Inspector General. PACER Case Reference. 15-25
- TYLER JAY REINMUTH, a 30-year-old resident of Havre, appeared on charges of conspiracy to possess with intent to distribute and to distribute methamphetamine and possession with intent to distribute methamphetamine. If convicted of the most serious charge contained in the indictment, REINMUTH faces 40 years in prison, $5,000,000 in fines and 4 years supervised release. The case was investigated by the Drug Enforcement Administration, Russell Country Drug Task Force and Havre Police Department. PACER Case Reference. 15-29
Appearing before U.S. Magistrate Judge Ostby in Billings on April 28, 2015, and entering pleas of Not Guilty were:
- GARRET JAY COSTA, JR, A 23-year-old resident of Crow Agency, appeared on charges of assault with a dangerous weapon and assault resulting in serious bodily injury. If convicted of the most serious charge contained in the indictment, COSTA faces 10 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the Federal Bureau of Investigation. PACER Case Reference: 15-41
Appearing before U.S. Magistrate Judge Lynch in Missoula on April 28, 2015, and entering pleas of Not Guilty were:
- STEPHON ELIJAH COAKLEY, a 19-year-old resident of Spokane, Washington, appeared on charges of conspiracy to possess with intent to distribute controlled substances and possession with intent to distribute methamphetamine and heroin. If convicted of the most serious charge contained in the indictment, COAKLEY faces 40 years in prison, $5,000,000 in fines and 4 years supervised release. The case was investigated by the Montana Regional Violent Crime Task Force, Federal Bureau of Investigation, Missoula Street Crimes Unit, Missoula County Sheriff’s Office Missoula Police Department and the Drug Enforcement Administration. PACER Case Reference. 15-06
- FREDERICK GLEN JOHNSON, a 47-year-old resident of Spokane, Washington, appeared on charges of conspiracy to possess with intent to distribute and to distribute controlled substances, possession with intent to distribute methamphetamine and heroin, possess and brandish a firearm in furtherance of a drug trafficking crime, felon in possession of firearm/armed career criminal, transportation of a person with intent to engage in criminal sexual activity, and interstate travel in aid of racketeering. The case was investigated by the Montana Regional Violent Crime Task Force, Federal Bureau of Investigation, Missoula Street Crimes Unit, Missoula County Sheriff’s Office Missoula Police Department and the Drug Enforcement Administration. PACER Case Reference. 15-06
Appearing before U.S. Magistrate Judge Ostby in Billings on April 27, 2015, and entering pleas of Not Guilty were:
- HARRY EDWARD ALLEN, Jr., a 33-year-old resident of Tulare, California, appeared on charges of conspiracy to possess with intent to distribute methamphetamine and possession with intent to distribute methamphetamine. If convicted of the most serious charge contained in the indictment, ALLEN faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by the Federal Bureau of Investigation. PACER Case Reference. 14-115
- HOPIE DANIELLE ALVAREZ, a 41-year-old resident of Billings, appeared on charges of conspiracy to distribute methamphetamine and distribution of methamphetamine. If convicted of the most serious charge contained in the indictment, ALVAREZ faces life in prison, $5,000,000 in fines and 4 years supervised release. The case was investigated by the FBI Task Force. PACER Case Reference. 15-27
- HOPIE DANIELLE ALVAREZ, a 41-year-old resident of Billings, appeared on charges of conspiracy to possess with intent to distribute methamphetamine, possession with intent to distribute methamphetamine and conspiracy to commit money laundering. If convicted of the most serious charges contained in the indictment, ALVAREZ faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by the FBI Task Force. PACER Case Reference. 15-29
- LUKE MICHAEL DOVEL, a 20-year-old resident of Billings, appeared on charges of receipt of a firearm and ammunition by person under indictment and possession of a stolen firearm. If convicted of the most serious charge contained in the indictment, DOVEL faces 10 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, Billings Police Department and Yellowstone County Sheriff’s Office. PACER Case Reference. 15-33
- JUAN CARLOS LOPEZ-FIGUEROA, a 40-year-old resident of Billings, appeared on charges of conspiracy to possess with intent to distribute methamphetamine, possession with intent to distribute methamphetamine and conspiracy to commit money laundering. If convicted of the most serious charges contained in the indictment, LOPEZ-FIGUEROA faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by the FBI Task Force. PACER Case Reference. 15-29
Appearing before U.S. Magistrate Judge Ostby in Billings on April 22, 2015, and entering pleas of Not Guilty were:
- LETHA JEWELL BIXBY, a 31-year-old resident of Lame Deer, appeared on charges of felony child abuse. If convicted of the most serious charges contained in the indictment, BIXBY faces 10 years in prison, $50,000 in fines and 3 years supervised release. The case was investigated by the Bureau of Indian Affairs. PACER Case Reference. 15-38
- VIRGINIA MARTINEZ, a 49-year-old resident of Hardin, appeared on charges of conspiracy to distribute methamphetamine and distribution of methamphetamine. If convicted of the most serious charges contained in the indictment, MARTINEZ faces 20 years in prison, $1,000,000 in fines and 3 years supervised release. The case was investigated by the Bureau of Indian Affairs. PACER Case Reference. 15-45
- CAROL EDITH PRETTY ON TOP, a 32-year-old resident of Lame Deer, appeared on charges of assault resulting in serious bodily injury and assault with a dangerous weapon. If convicted of the most serious charge contained in the indictment, PRETTY ON TOP faces 10 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the Bureau of Indian Affairs. PACER Case Reference. 15-47
Appearing before U.S. Magistrate Judge Johnston in Great Falls on April 21, 2015, and entering pleas of Not Guilty were:
- KEITH MOREHOUSE, a 30-year-old resident of Glasgow, appeared on charges of unlawful taking of a golden eagle. If convicted of the charge contained in the information, MOREHOUSE faces 1 year in prison and $100,000 in fines. The case was investigated by the United States Fish and Wildlife Service. PACER Case Reference: 15-26
If any of the above cases are of interest to your media organization and the community it serves, we encourage you to monitor the progress of the case regularly through the U.S. District Court calendar and the PACER system so that you stay current and not miss any important developments in the case.
To establish a PACER account, which will allow you to review documents filed in the case, please go to, http://www.pacer.gov/register.html. To access the district court’s calendar, please go to https://ecf.mtd.uscourts.gov/cgi-bin/PublicCalendar.pl.
Harrisburg Man Sentenced to 7 Years for Armed Bank RobberyRead the Press Release
HARRISBURG-The United States Attorney’s Office for the Middle District of Pennsylvania announced that U.S. District Court Judge Yvette Kane sentenced Tashan Lantiqua Layton, age 24, of Harrisburg, yesterday to 84 months in prison for bank robbery.
During the sentencing hearing, Assistant U.S. Attorney Joseph Terz stated that on March 30, 2013, Layton entered the Sovereign Bank branch at 519 South 29th Street, Harrisburg, Pennsylvania, pointed a gun at a bank manager, and demanded money. Layton admitted to the Court that the gun he pointed at the bank employee was loaded. Customers were present in the bank at the time of the incident.
The 84-month sentence Layton received represents the high end of the guidelines range he faced. The Court rejected defense counsel's request for a downward variance.
The investigation was conducted by the Harrisburg Police Department and the FBI.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law is 20 years of imprisonment, a term of supervised release following imprisonment, and a 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.
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Guatemalan Native Charged with Illegal ReentryRead the Press Release
Cesar Augusto Perez, a/k/a “Erick Alberto Perez,” 41, of Philadelphia, PA, was charged on April 30th by indictment with illegal reentry after deportation, announced United States Attorney Zane David Memeger. The indictment alleges that on or about March 26, 2015, Perez, an alien, and native and citizen of Guatemala, was found in the United States after having been deported from the United States on or about July 9, 1999 and April 6, 2006.
If convicted the defendant faces a maximum possible sentence of ten years.
The case was investigated by Immigration and Customs Enforcement, Enforcement and Removal Operations (“ERO”), and is being prosecuted by Special Assistant United States Attorney Jordan Strauss.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Guatemalan National Charged with Illegal ReentryRead the Press Release
U.S. Attorney Kenneth A. Polite announced that SERGIO TULIO VARGAS-VARGAS, age 25, a citizen of Guatemala, was charged today in a one-count Indictment with illegal reentry of a removed alien.
According to the Indictment, VARGAS-VARGAS reentered the United States after having been previously deported on October 25, 2012. If convicted, VARGAS-VARGAS faces a maximum term of imprisonment of two years, a maximum fine of $250,000, a maximum term of supervised release of one year, and a mandatory $100 special assessment.
U. S. Attorney Polite reiterated that an Indictment is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
U.S. Attorney Polite praised the work of the United States Immigration and Customs Enforcement Agency in investigating this matter. Assistant U.S. Attorney Spiro G. Latsis is in charge of the prosecution.
Sergio Tulio Vargas-Vargas Indictment
Government Moves to Dismiss Rim Fire IndictmentRead the Press Release
FRESNO, Calif. — The government has moved to dismiss the federal indictment against Keith Matthew Emerald, 33, of Columbia, California, United States Attorney Benjamin B. Wagner announced. The indictment alleged that Emerald had caused the Rim Fire, which burned approximately 250,000 acres of land, and that he had made a false statement to federal investigators regarding the origin of that fire.
In its motion to dismiss, filed today, the government advised the United States District Court that two witnesses had unexpectedly died in recent months, since the filing of the indictment last August. The government’s motion characterized one witness as critical to the case and stated that he had been expected to provide trial testimony regarding his discussions with Emerald shortly after Emerald had been rescued from the vicinity of the Rim Fire’s origin. That witness died in a workplace accident in February. The second witness was the helicopter pilot who first responded to the Rim Fire. That witness had been expected to testify about the initial response to the Rim Fire and the rescue of the defendant very close to the Rim Fire’s point of origin. That witness died in March of cardiac arrest. These witnesses’ prior statements are inadmissible hearsay and cannot be used as evidence at trial.
In its motion, the government stated that it had reassessed the case in light of the loss of this anticipated trial testimony and determined that without that testimony it was unlikely to prove the charges in the case beyond a reasonable doubt to the unanimous satisfaction of a trial jury. Accordingly, it was in the interests of justice to dismiss the case.
United States Attorney Wagner stated, “I appreciate the hard work done by the US Forest Service in investigating this case, and I understand that the government’s motion to dismiss will be frustrating to some. However, when circumstances change after indictment, and our judgment is that a case is no longer likely to be proven beyond a reasonable doubt, it is our obligation to the defendant and to the Court to dismiss that case.”
The United States Attorney also noted that the indictment contained only allegations; a defendant is always presumed innocent until and unless proven guilty beyond a reasonable doubt.
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Georgia Man Pleads Guilty in Stolen Identify Refund Fraud SchemeRead the Press Release
PITTSBURGH - An individual from the State of Georgia pleaded guilty in federal court to charges of wire fraud conspiracy and aggravated identity theft, United States Attorney David J. Hickton announced today.
Mark Williams, a/k/a Frank White, 45, of Summerville, Ga., pleaded guilty to two counts before United States District Judge Nora Barry Fischer.
In connection with the guilty plea, Williams, along with other co-conspirators, conspired to steal identities of other persons that were used to file false electronic federal tax returns between 2011 and 2015 which requested federal income tax refunds into bank accounts in Pittsburgh and in Georgia.
Judge Fischer scheduled the sentencing for Sept. 3, 2015. The law provides for a maximum total sentence of not more than 44 years in prison, a fine of $500,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Gregory C. Melucci is prosecuting this case on behalf of the government.
The Internal Revenue Service-Criminal Investigation conducted the investigation that led to the prosecution of Mark Williams.
Gang Member Sentenced to Life for South San Francisco Murders, Attempted Murder of Federal Agents and Racketeering ConspiracyRead the Press Release
Victor Flores, 23, of Petaluma, California, a member of the 500 Block/C Street Gang of South San Francisco, was sentenced to life in prison, announced U.S. Attorney Melinda Haag, Acting Special Agent in Charge Tatum King of Homeland Security Investigations and Special Agent in Charge David J. Johnson of FBI.
Flores was convicted after a three-month trial spanning from April through July of 2014 before the Honorable U.S. District Judge Susan Illston. According to the evidence presented at trial, during the evening of Dec. 22, 2010, Flores, along with fellow 500 Block/C Street gang member Joseph Ortiz, shot at seven victims who they perceived to be members of the rival Cypress Park Locos gang as the victims walked down Eighth Lane in South San Francisco. Gonzalo Avalos, Omar Cortez and Hector Flores were killed while three of the others were wounded. In addition, on May 3, 2012, when special agents of the Los Angeles Special Response Team of Homeland Security Investigations tried to arrest Flores at his home in Petaluma, Flores shot at the agents with an AK-47-style assault rifle, emptying two full magazines of ammunition and wounding three agents before eventually surrendering to law enforcement.
The jury convicted Flores of racketeering murders of Avalos, Cortez, and Flores; racketeering attempted murders of the other four victims on Eighth Lane; attempted murders of three federal agents; using a firearm in furtherance of the December 22, 2010, and May 3, 2012, murders and attempted murders; conspiring to conduct the affairs of the 500 Block/C Street Gang through a pattern of racketeering; conspiring to commit murder in aid of racketeering; and conspiring to commit assault with a dangerous weapon in aid of racketeering.
“Nothing can erase the pain and sorrow caused by Flores’ vicious, unrepentant, criminal behavior,” said U.S. Attorney Haag. “I hope that the life sentence imposed against him brings some measure of relief to Flores’ victims and their families and that they will at least feel a sense of justice. I am extraordinarily proud of the professionalism and bravery demonstrated by the men and women of law enforcement in this case. They are true heroes and we are especially thankful for their service and commitment to the pursuit of justice.”
“Today’s sentence assures that no one else will risk being killed or maimed by an individual who has shown no regard for our laws or human life,” said Acting Special Agent in Charge King. “As we said when this defendant was arrested, ‘justice is patient and justice is resolute.’ Well today, justice was served. We owe a profound debt of gratitude to the prosecutors in this case, the FBI and the investigators with the police departments in South San Francisco and Daly City, all of whom worked tirelessly in collaboration with HSI to bring this outcome about.”
“The South San Francisco Police Department is very pleased with today’s sentencing of Victor Flores,” said Chief of Police Jeff Azzoparti. “Our ultimate goal as a police department is to provide a safe community for our residents to live in. Flores is an extremely violent criminal and today’s sentence removes Flores from our streets and brings us closer to a safer community. Our thoughts are with the victim’s families and while today’s sentence will not bring back their loved ones, hopefully it helps bring closure to the case knowing justice has been served. The South San Francisco Police Department is determined to rid our community of violent gang members and we will continue to utilize any and all resources available to us to meet that end. We would like to thank the Department of Homeland Security and the U.S. Attorney’s Office for their steadfast contributions in this case, which ultimately brought it to a successful resolution.”
“The conviction of Victor Flores for murder and for his attempted murder of three Department of Homeland Security agents represents a significant victory for the rule of law and for the agents and officers who put their lives on the line every day to enforce those laws,” said Special Agent in Charge Johnson. “The severity of the sentencing demonstrates that our court system will not tolerate violent behavior towards law enforcement agents and those who engage daily in the pursuit of justice.”
Assistant U.S. Attorneys Acadia L. Senese, Stephen Meyer and Benjamin Tolkoff are prosecuting this case, with the assistance of paralegal Kevin Costello and legal technician Daniel Charlier-Smith. The sentence imposed on Flores is the culmination of a lengthy investigation initiated by the South San Francisco and Daly City Police Departments more than four years ago. In 2011, Homeland Security Investigations joined the investigation and the FBI investigated the attempted murder of the Homeland Security Investigations agents. In all, more than 19 defendants were charged and convicted in crimes related to the 500 Block/C Street Gang activity.
Gang Member Sentenced to Life for South San Francisco Murders, Attempted Murder of Federal Agents, and Racketeering ConspiracyRead the Press Release
SAN FRANCISCO – Victor Flores, a member of the 500 Block/C Street Gang of South San Francisco, was sentenced to life in prison announced United States Attorney Melinda Haag, Homeland Security Investigations Special Agent in Charge Tatum King, and FBI Special Agent in Charge, David J. Johnson.
Flores, 23, of Petaluma, Calif., was convicted after a three-month trial spanning from April through July of 2014 before the Honorable Susan Illston, U.S. District Judge. According to the evidence presented at trial, during the evening of December 22, 2010, Flores, along with fellow 500 Block/C Street gang member Joseph Ortiz, shot at seven victims who they perceived to be members of the rival Cypress Park Locos gang as the victims walked down Eighth Lane in South San Francisco. Gonzalo Avalos, Omar Cortez, and Hector Flores were killed while three of the others were wounded. In addition, on May 3, 2012, when special agents of the Los Angeles Special Response Team of Homeland Security Investigations tried to arrest Flores at his home in Petaluma, Flores shot at the agents with an AK-47-style assault rifle, emptying two full magazines of ammunition and wounding three agents before eventually surrendering to law enforcement.
The jury convicted Flores of: (1) the December 22, 2010, racketeering murders of Avalos, Cortez, and Flores; (2) the December 22, 2010, racketeering attempted murders of the other four victims on Eighth Lane; (3) the May 3, 2012, attempted murders of three federal agents; (4) using a firearm in furtherance of the December 22, 2010, and May 3, 2012, murders and attempted murders; (5) conspiring to conduct the affairs of the 500 Block/C Street Gang through a pattern of racketeering; (6) conspiring to commit murder in aid of racketeering; and (7) conspiring to commit assault with a dangerous weapon in aid of racketeering.
“Nothing can erase the pain and sorrow caused by Flores’ vicious, unrepentant, criminal behavior. I hope that the life sentence imposed against him brings some measure of relief to Flores’ victims and their families, and that they will at least feel a sense of justice,” U.S. Attorney Haag said. “I am extraordinarily proud of the professionalism and bravery demonstrated by the men and women of law enforcement in this case. They are true heroes and we are especially thankful for their service and commitment to the pursuit of justice.”
“Today’s sentence assures that no one else will risk being killed or maimed by an individual who has shown no regard for our laws or human life,” said Tatum King, Acting Special Agent in Charge for Homeland Security Investigations (HSI) San Francisco. “As we said when this defendant was arrested, ‘justice is patient and justice is resolute.’ Well today, justice was served. We owe a profound debt of gratitude to the prosecutors in this case, the FBI, and the investigators with the police departments in South San Francisco and Daly City, all of whom worked tirelessly in collaboration with HSI to bring this outcome about.”
“The South San Francisco Police Department is very pleased with today’s sentencing of Victor Flores,” said Chief of Police Jeff Azzoparti. “Our ultimate goal as a police department is to provide a safe community for our residents to live in. Flores is an extremely violent criminal and today’s sentence removes Flores from our streets and brings us closer to a safer community. Our thoughts are with the victim’s families, and while today’s sentence will not bring back their loved ones, hopefully it helps bring closure to the case knowing justice has been served. The South San Francisco Police Department is determined to rid our community of violent gang members and we will continue to utilize any and all resources available to us to meet that end. We would like to thank the Department of Homeland Security and the United States Attorney’s Office for their steadfast contributions in this case, which ultimately brought it to a successful resolution.”
“The conviction of Victor Flores for murder, and for his attempted murder of three Department of Homeland Security agents represents a significant victory for the rule of law and for the agents and officers who put their lives on the line every day to enforce those laws,” said David J. Johnson, FBI Special Agent in Charge of the San Francisco Field Office. “The severity of the sentencing demonstrates that our court system will not tolerate violent behavior towards law enforcement agents and those who engage daily in the pursuit of justice.”
Assistant United States Attorneys Acadia L. Senese, Stephen Meyer, and Benjamin Tolkoff are prosecuting this case, with the assistance of paralegal Kevin Costello and legal technician Daniel Charlier-Smith. The sentence imposed on Flores is the culmination of a lengthy investigation initiated by the South San Francisco and Daly City Police Departments more than four years ago. In 2011, Homeland Security Investigations joined the investigation and the Federal Bureau of Investigations investigated the attempted murder of the Homeland Security Investigations agents. In all, more than 19 defendants were charged and convicted in crimes related to the 500 Block/C Street Gang activity.
Former center township official sentencedRead the Press Release
INDIANAPOLIS - United States Attorney, Josh J. Minkler, announced today the sentencing of the former chief financial officer for Center Township in Indianapolis. Alan Mizen 59, Zionsville, was sentenced to 18 months imprisonment by U. S. District Judge Sarah Evans Barker after his conviction for theft of federal program funds.
"The citizens of Marion County deserve better from their public officials,” said Minkler. “I hope this sends a loud and strong message to anyone who abuses the public trust in Indiana. The U. S. Attorney’s Office will you hold you strictly accountable.”
Mizen served as the chief financial officer for Center Township. In June 2010, he set up an account with PNC Bank and deposited a check in the amount of $343,541.08 that was drawn from public funds. Mizen then used the computerized accounting system at the Center Township Trustee’s Office to create a false invoice indicating that he had written the check to the “Treasurer of State.”
Mizen then transferred the funds to various personal accounts that he maintained. From these personal accounts, Mizen used over $200,000 towards the purchase of a residence in Zionsville, the purchase of a Toyota Tacoma pickup truck, the funding of his child’s college education, personal vacations, the purchase a diamond necklace and diamond ring for $8,900 during a trip to the Cayman Islands and made other consumer purchases. Mizen used embezzled taxpayer funds to finance these personal expenditures from June 10, 2010, through July 2012.
Minkler stated that this case was the result of outstanding law enforcement work by the
Federal Bureau of Investigation and Indiana State Board of Accounts with the assistance of the Internal Revenue Service. All three agencies are partners in the U.S. Attorney=s Public Integrity Working Group, which was launched in April 2012, with the stated purpose of aggressively investigating allegations of public fraud, waste and abuse by public officials in Indiana.
We are glad that the citizens of Center Township are getting the funds that were taken from them by Mr. Mizen,” said Indiana State Board of Accounts State Examiner, Paul Joyce. “We all have the right to expect honest representation from our elected and/or appointed officials at all levels of government. I hope that those few public servants that decide to violate this trust will see that we, in conjunction with our state and federal partners, are prosecuting these officials and realize that this is not acceptable and we will hold them accountable.”
According to Senior Litigation Counsel Bradley A. Blackington, who prosecuted the case for the government, Mizen was ordered to pay $343,000 in restitution. This restitution will be paid in full from funds in the accounts maintained by Mizen that were frozen by the government as part of the investigation.
Former University Administrative Assistant Pleads Guilty to Embezzling over $300,000 from EmoryRead the Press Release
ATLANTA - Brenda Michael, who embezzled more than $300,000 from Emory University by using a fake PayPal account, has pleaded guilty to wire fraud.
“Michael brazenly abused her position with Emory University by misdirecting student payments to a personal account for more than a year,” said Acting U. S. Attorney John Horn. “Those funds were owed to the school, paid by students working on their college education.”
According to Acting U.S. Attorney Horn, the charges and other information presented in court: Brenda Michael was employed as an administrative assistant with Emory University from 2007 through 2014. From 2012 to 2014, while enrolling students for certain classes and programs, she began directing students to make tuition and fee payments which were due to Emory University to a PayPal account. Unbeknownst to the students, the PayPal account where they sent funds was the defendant’s own personal account. She then spent the funds on personal expenses. In total, she fraudulently received more than $317,000 from her scheme.
Sentencing for Michael, 53, of Atlanta, Georgia, is scheduled for July 8th, 2015 at 10:00 a.m. before United States District Judge Willis B. Hunt.
This case is being investigated by the Federal Bureau of Investigation. Emory University has fully cooperated in this investigation.
Assistant United States Attorney Jamie L. Mickelson is prosecuting the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao-ndga.
Former Puerto Rico Police Officers Sentenced for Civil Rights and Obstruction of Justice Violations Related to Fatal BeatingRead the Press Release
Former Puerto Rico Police Officers Jimmy Rodriguez Vega and David Colon Martinez were sentenced today for civil rights and obstruction of justice violations related to the fatal beating of Jose Luis Irizarry Perez, 19, announced Principal Deputy Assistant Attorney General Vanita Gupta of the Civil Rights Division, U.S. Attorney Rosa Emilia Rodriguez-Velez of the District of Puerto Rico and Special Agent in Charge Carlos Cases of the FBI San Juan Field Office. Rodriguez Vega was sentenced to serve 33 months months in prison for violating Irizarry Perez’s civil rights by striking him with a police baton during the incident, and Colon Martinez was sentenced to serve 24 months for making false statements to a Special Agent of the Federal Bureau of Investigation (FBI) and to the federal grand jury during the federal civil rights investigation.
With the issuance of today’s sentences, all six former Puerto Rico police officers who pled guilty for their roles in the beating and obstruction of the subsequent civil rights investigation have been sentenced. According to documents filed in connection with the underlying guilty pleas, Rodriguez Vega and former Puerto Rico Police Sergeant Erick Rivera Nazario violated the constitutional rights of Irizarry Perez by striking him with their police batons while Colon Martinez physically restrained Irizarry Perez during an election evening celebration at the Las Colinas housing development in Yauco, Puerto Rico, on Nov. 5, 2008. As part of his guilty plea, Rodriguez Vega admitted that after Rivera Nazario struck Irizarry Perez, while he was restrained and not posing a threat to any officer, Rodriguez Vega swung his own police baton as if it were a baseball bat into the victim’s forehead. In conjunction with his guilty plea, Colon Martinez admitted that he falsely told the FBI and the grand jury that he did not see anyone else hit Irizarry Perez, whereas in truth he observed Rodriguez Vega and Rivera Nazario swing their batons into Irizarry Perez’s head and upper body, after which the victim collapsed to the ground.
U.S. District Court Judge Juan M. Perez Gimenez issued the sentence, which will be followed by three years of supervised release. During the three-year term, the defendants will be under federal supervision, and risk additional prison time should they violate any terms of their supervised release.
“The former police officers convicted for their roles in the fatal beating and obstruction of the subsequent investigation violated their sworn oaths to the young victim, his family, and the public at large,” said Principal Deputy Assistant Attorney General Gupta. “Unfortunately, egregious civil rights violations by a few individuals, such as in this case, damage the public’s trust in law enforcement. That’s why the department will steadfastly continue to investigate and prosecute these matters, but also work with law enforcement to rebuild that trust and ensure all individuals’ civil rights are protected under the law.”
“Today’s sentencing brings a measure of justice to the family of Jose Luis Irizarry Perez,” said U.S. Attorney Rodriguez-Vélez. “The U.S. Attorney’s Office reaffirms its commitment to vigorously prosecute those who abuse their power and official positions at the expense of constitutionally guaranteed civil rights.”
This case was investigated by the FBI’s San Juan Division and is being prosecuted by Senior Litigation Counsel Gerard Hogan and Trial Attorneys Shan Patel and Olimpia E. Michel of the Civil Rights Division and Assistant U.S. Attorney Jose A. Contreras of the District of Puerto Rico.
Former Mayor of Manalapan, New Jersey, Sentenced to Five Years in Prison for Mortgage Fraud, Identity Theft and Obstruction of JusticeRead the Press Release
TRENTON, N.J. – The former mayor of Manalapan, New Jersey, was sentenced today to 60 months in prison for defrauding an investment client of $250,000 and submitting a falsified loan application in order to purchase farmland in Monmouth County, New Jersey, U.S. Attorney Paul J. Fishman announced.
Andrew Lucas, 37, was previously convicted by a federal jury on all 11 counts of an indictment charging him with wire fraud, an illegal monetary transaction, loan application fraud, false statements to the IRS, aggravated identity theft, obstruction of a grand jury investigation and falsification of records in a federal investigation. Lucas was convicted following a two-week trial before U.S. District Judge Freda L. Wolfson, who imposed the sentence today in Trenton federal court.
According to documents filed in this case and the evidence at trial:
On Dec.15, 2009, Lucas submitted a loan application to a New Jersey bank requesting $525,000 to finance his purchase of the Burke Farm property in Manalapan. Lucas provided the bank with falsified versions of his 2007 and 2008 tax returns, as well as a falsified version of a 2007 tax return for a relative whose name was also on the loan application. Lucas also falsely reported that he had a total of $210,000 in cash.
Lucas owned and operated Lucas Capital Advisors LLC (Lucas Capital), through which he served as an investment advisor and manager to multiple individuals. To obtain the $250,000 down payment for the property, Lucas approached Bobby Janowski, who was a client of Lucas Capital, to pitch an investment in an entity called VLM Investments LLC (VLM). On Feb. 15, 2010, Lucas presented a written note to Janowski, which stated that the $250,000 investment was to be secured by “…interest in the equipment, fixtures, inventory and accounts receivable” of VLM. However, Lucas failed to inform Janowski that at the time the note was signed, VLM did not exist. Lucas also failed to disclose to Janowski that Lucas intended to make personal use of the funds. It was not until three days later, on Feb. 18, 2010, that Lucas created VLM by registering it with the State of New Jersey and the IRS, using the name and Social Security number of Lucas’ out-of-state relative, Thomas Littlefield, without his knowledge or permission.
On Feb. 22, 2010, Lucas authorized the wiring of $250,000 from Janowski’s Lucas Capital investment account to a VLM bank account that had Lucas as the only authorized signer. On March 1, 2010, Lucas withdrew this money in the form of a bank check, which he provided the next day to the closing attorney for the purchase of the Burke Farm property.
Lucas also filed tax returns for VLM for tax years 2011 and 2012, both times listing Littlefield’s name and Social Security number without Littlefield’s knowledge or permission.
Federal investigators served Lucas with subpoenas on Feb. 7, 2013, for the records of VLM and Lucas Capital Advisors. In response, Lucas provided federal authorities with a fabricated and back-dated letter purporting to be from Littlefield concerning a transaction for the purchase of the Burke Farm property.
In addition to the prison term, Judge Wolfson sentenced Lucas to serve three years of supervised release and forfeit Burke Farm.
U.S. Attorney Fishman credited special agents of the FBI Red Bank Office, under the direction of Special Agent in Charge Richard M. Frankel; special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen; and investigators with the U.S. Attorney’s Office, for the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorneys Matthew Skahill in Camden and Rahul Agarwal in Newark, both of the U.S. Attorney’s Special Prosecutions Division.
Defense counsel: Mario F. Gallucci Esq., and Michael DeSantis Esq., of Staten Island, New York
Former Manatee County Probation Officer Convicted of Stolen Identity Tax Refund FraudRead the Press Release
Tampa, Florida – United States Attorney A. Lee Bentley, III announces that a federal jury today found Marcus Lowe guilty of conspiracy to commit wire fraud, theft of government funds, and aggravated identity theft; wire fraud; theft of government funds; and aggravated identity theft. He faces a maximum penalty of 5 years for the conspiracy count, 20 years for the wire fraud count, 10 years on each of the two theft counts, to be followed by a mandatory consecutive term of at least two years in federal prison for the aggravated identity theft counts. His sentencing hearing has not yet been scheduled. Lowe was indicted on December 4, 2014.
According to evidence presented at trial, Lowe worked as a Manatee County Probation Officer at the Manatee County Jail in 2012. As a result of that job, he had access to the personal identifying information of numerous inmates. He provided that information to other co-conspirators who, in turn, used those identities to file false and fraudulent income tax returns with the IRS. The attempted loss to the government from the fraudulent tax returns charged in the indictment exceeded $74,000.
This case was investigated by Internal Revenue Service - Criminal Investigation. It is being prosecuted by Assistant United States Attorney Jay L. Hoffer.
Former Hampshire County loan officer convicted of bank fraudRead the Press Release
MARTINSBURG, WEST VIRGINIA – Kimberly Haslacker, 39, of Romney, West Virginia, was convicted of bank fraud in federal court today after she admitted to using her position as a bank loan officer to obtain fraudulent loans, United States Attorney William J. Ihlenfeld, II, announced.
Haslacker was formerly employed as a loan officer at The Bank of Romney. She used her position to submit false and fraudulent loan applications in her own name and in the names of friends and relatives. Using this scheme, she obtained nearly $170,000.00 in unlawful loan proceeds.
Haslacker pled guilty today to a criminal Information charging her with one count of “Bank Fraud.” She faces up to 30 years in prison and a fine of up to $1,000,000.00. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Paul Camilletti prosecuted the case on behalf of the government. The Federal Bureau of Investigation led the inquiry.
U.S. Magistrate Judge Robert W. Trumble presided.
Former Deputy Executive Director of Port Authority and Former Deputy Chief of Staff in N.J. Governor’s Office IndictedRead the Press Release
Allegedly Misused Government Property to Punish Fort Lee Mayor for Not Endorsing Gov. Christie’s Re-election
Second Former Port Authority Official Pleads Guilty in Connection with His Role in Scheme
NEWARK, N.J. – A former top official of the Port Authority of New York and New Jersey and a former member of Gov. Christopher J. Christie’s senior staff have been charged with a scheme to misuse Port Authority resources to facilitate and conceal the causing of traffic problems in Fort Lee, New Jersey, to punish the borough’s mayor for not endorsing the Governor’s re-election.
The charges were announced today by U.S. Attorney Paul J. Fishman, along with Inspector General Michael Nestor of the Port Authority, Office of Inspector General, and FBI Special Agent in Charge Richard M. Frankel, Newark Division.
William E. Baroni Jr., former deputy executive director of the Port Authority, and Bridget Anne Kelly, former deputy chief of staff to Gov. Christie, were each charged by a federal grand jury in a nine-count indictment unsealed today. David Wildstein, the former director of Interstate Capital Projects at the Port Authority, pleaded guilty today before U.S. District Judge Susan D. Wigenton in Newark federal court to a separate information charging him with two counts of conspiracy for his role in the scheme.
“Public officials must use government resources for proper government purposes,” U.S. Attorney Fishman said. “The indictment alleges, and Wildstein admitted, that the three defendants used Port Authority resources to exact political retribution against a public official who would not endorse the Governor for re-election, and concocted and promoted a bogus cover story to execute their plan and to cover their tracks.”
“William Baroni, Bridget Anne Kelly, and David Wildstein were held to a high standard of conduct due to the power they were entrusted with by the public,” Special Agent in Charge Frankel said. “These individuals breached that trust and as a consequence should be held accountable.”
“These high level government officials misused the Port Authority, its employees, and their public positions for political purposes with total disregard of the negative consequences it would have on the public and Port Authority,” Inspector General Nestor said. “This case should serve as a wake-up call and warning to those public servants who might consider abusing their official positions for their personal benefit, or the benefit of others.”
Baroni and Kelly are each charged with conspiring to misuse, and actually misusing, property of an organization receiving federal benefits; conspiring to commit, and actually committing, wire fraud; conspiring to injure and oppress certain individuals’ civil rights, and acting under color of law to deprive certain individuals of their civil rights. All of the charges relate to the defendants’ alleged scheme to manufacture traffic problems in Fort Lee by, without public warning, reducing from three to one the number of local access lanes, located in Fort Lee, to the upper level of the George Washington Bridge, and the toll booths servicing those lanes. It is alleged this was done to punish Mayor Sokolich for not endorsing Gov. Christie’s re-election bid. Wildstein pleaded guilty to conspiring to misuse the property of an organization receiving federal benefits and conspiring to injure and oppress certain individuals’ civil rights in connection with his role in causing traffic problems to punish Mayor Sokolich.
According to documents filed in this case and statements made in court:
In August 2013, after Kelly confirmed that Mayor Sokolich would not be endorsing Gov. Christie for re-election in November 2013, Baroni, Kelly, and Wildstein decided to punish the mayor by deliberately causing significant traffic problems in Fort Lee under the false pretense of a traffic study.
From the morning of Sept. 9, 2013, to Sept. 13, 2013, the conspirators allegedly caused the local access lanes to be reduced so that only one toll booth, instead of the usual three, was accessible to the approach to the bridge for local traffic traveling through Fort Lee. To maximize the congestion and the punitive impact on Mayor Sokolich, the conspirators caused these lane and toll booth reductions to start on the first day of the school year without any advance notice to Mayor Sokolich, the Fort Lee chief of police or borough residents. The lane and toll booth reductions resulted in significant traffic in Fort Lee, for motorists intending to access the George Washington Bridge from local lanes and for residents, whose streets were choked with traffic.
The conspirators allegedly agreed to disregard any inquiries from Mayor Sokolich and other Fort Lee officials about the lane and toll booth reductions. They purposely ignored communications from Mayor Sokolich, including his pleas for help, requests for information, and repeated warnings about the increased risks to public safety. On Sept. 9, 2013, after Baroni received an email that Mayor Sokolich had called about an urgent matter of public safety, Wildstein sent an email to Baroni reiterating that Baroni should maintain “radio silence” toward the mayor. When Kelly was made aware of Mayor Sokolich’s communication regarding an urgent matter of public safety, she thanked Wildstein for confirming that Baroni had maintained “[r]adio silence” toward Mayor Sokolich. As alleged in the indictment, on Sept. 12, 2013, Baroni instructed a Port Authority employee through coded language that the employee should not contact Mayor Sokolich.
The conspirators concocted and promoted a sham story that the lane reductions were for a traffic study. They created and advanced this cover story so they could use Port Authority property, including the time and services of unwitting Port Authority personnel and other resources, to implement the lane and toll booth reductions and conceal their true punitive purpose.
On Nov. 25, 2013, with Kelly’s and Wildstein’s knowledge, Baroni provided false and misleading testimony about the lane and toll booth reductions to the N.J. Assembly Transportation, Public Works, and Independent Authorities Committee. Baroni knowingly and intentionally made misleading statements and false representations, including: (1) communications between members of the Port Authority Police Department and Wildstein triggered the lane and toll booth reductions; (2) the lane and toll booth reductions were part of a one-week traffic study; and (3) the failure to communicate with Fort Lee and the executive director of the Port Authority was simply the result of communication breakdowns at the Port Authority.
On the count of conspiracy to misuse property of an organization receiving federal benefits, the defendants and Wildstein each face a maximum potential penalty of five years in prison and a fine of $250,000. On the count of misusing property of an organization receiving federal benefits, the defendants each face a maximum potential penalty of 10 years in prison and a fine of $250,000. On each of the wire fraud conspiracy and wire fraud counts, the defendants face a maximum potential penalty of 20 years in prison and a fine of $250,000 per count. On the count of conspiring to injure and oppress certain individuals’ civil rights, the defendants and Wildstein each face a maximum potential penalty of 10 years in prison and a fine of $250,000. On the count of acting under color of law to deprive certain individuals of their civil rights, the defendants face a maximum potential penalty of one year in prison and a fine of $250,000.
U.S. Attorney Fishman credited criminal investigators of the Port Authority, Office of Inspector General, under the direction of Inspector General Nestor; special agents of the FBI, under the direction of Special Agent in Charge Frankel; and criminal investigators of the U.S. Attorney’s Office, for the investigation leading to today’s charges and guilty plea.
The government is represented by Assistant U.S. Attorneys Lee M. Cortes Jr., Vikas Khanna, and Senior Litigation Counsel J Fortier Imbert of the U.S. Attorney’s Office Special Prosecutions Division, and Assistant U.S. Attorneys Paul Murphy and David W. Feder of the Criminal Division.
The charges and allegations contained in the indictment are merely accusations and the defendants are considered innocent unless and until proven guilty.
Defense counsel:
William E. Baroni: Michael Baldassare Esq., Newark
Bridget Anne Kelly: Michael Critchley Sr. Esq., Roseland, New Jersey
David Wildstein: Alan L. Zegas Esq., Chatham, New Jersey
Former DISD Employee and Co-Conspirator Sentenced for Roles in Mail Fraud ConspiracyRead the Press Release
DALLAS — A former employee with the Dallas Independent School District (DISD) and her co-conspirator, who each pleaded guilty to one count of conspiracy to commit mail fraud, have been sentenced, announced John Parker, Acting U.S. Attorney for the Northern District of Texas.
Maricella Reed, 41, who was employed by the DISD as a data specialist in the worker’s compensation section of the district’s Risk Management Department, was sentenced in March by U.S. District Judge Sidney A. Fitzwater to 24 months in federal prison.
Today, Judge Fitzwater sentenced Reed’s co-conspirator, Adrian Bevelle, 32, to 39 months in federal prison. They were ordered to pay, jointly and severally, more than $161,000 in restitution. Reed is currently serving her sentence; Bevelle must surrender to the Bureau of Prisons on June 16, 2015.
According to documents filed in the case, from May 2009 to May 2011, Reed used her position to cause unauthorized payments be issued to Bevelle. Bevelle was not a DISD employee nor was he a worker’s compensation claimant; he was not entitled to any benefits from the DISD worker’s compensation program.
Reed altered information sent to Accounts Payable, substituting Bevelle’s name in place of legitimate claimants and adding Bevelle’s name and payment amounts to the list of legitimate claimants. Reed also created and submitted payment voucher forms for Bevelle in various amounts. Based on the information Reed provided, Accounts Payable issued checks to Bevelle and mailed the checks to him at various addresses in Dallas and Irving. Bevelle received, endorsed and cashed the checks at various locations.
The U.S. Postal Inspection Service investigated. Special Assistant U.S. Attorneys Dan Gividen and Michelle Allen-McCoy prosecuted.
Felon Impersonates Federal Agent while Armed with GunRead the Press Release
ATLANTA - Daniel M. Harbison has been arraigned on federal charges of being a felon in possession of a firearm while impersonating a DEA agent after he allegedly performed a traffic stop of an off-duty Doraville police officer.
“Posing as a federal agent creates a genuine safety risk for everyone involved, as well as bystanders, especially when a firearm is present,” said Acting U.S. Attorney John A. Horn. “The event is deeply unsettling to the victim and threatens to undermine legitimate police encounters that take place every day.”
Daniel R. Salter, the Special Agent in Charge of the Drug Enforcement Administration’s Atlanta Field Division said of the case, “When Mr. Harbison pretended to be a DEA agent, he undermined the hard work and dedication of all DEA agents and the other dedicated law enforcement officers who legitimately earned their badges. His actions were exposed because of the hard work conducted by the Doraville Police Department, the Federal Bureau of Investigation’s Atlanta office and DEA. This defendant will now have to pay the price for the crimes he committed.”
“Doraville Police's ability to rapidly react to the DEA impersonator landed him where he needs to be, behind bars. Had he not stopped our officer, who knows what damage he could have done to citizens? We are thankful for both the local and Federal cooperation that will insure Harbison's activity will be fully prosecuted. It is still unknown how many victims remain, but we can say there won't be more,” said John King, Chief of Police, Doraville Police Department.
According to Acting U.S. Attorney Horn, the charges, and other information presented in court: In the spring of 2015, Harbison began impersonating a Drug Enforcement Administration (“DEA”) officer. Specifically, on April 3, 2015, in Doraville, Georgia, Harbison conducted a traffic stop of a Chevrolet Suburban by activating light-emitting diode (“LED”) lights on his vehicle similar to those of a law-enforcement vehicle, except the lights were green and possibly white instead of blue and white. Unbeknownst to Harbison, the Chevrolet Suburban was being driven by an off-duty Corporal with the Doraville Police Department. During the unauthorized traffic stop, Harbison wore a T-shirt printed with the letters “DEA,” carried what appeared to be a .45 caliber handgun in a thigh holster, and possessed an identification card purportedly issued by the DEA. The Doraville Corporal also saw that Harbison possessed a realistic gold and blue badge embossed with the letters “US.”
The Doraville Corporal told Harbison that he was a Doraville Police Officer and asked Harbison why his LED lights were green and white. The indictment alleges that in response to the question, Harbison replied that his LED lights were green and white because he was a federal officer. The Doraville Corporal then stated that other police officers were in route to check the validity of Harbison’s law enforcement credentials – whereupon Harbison returned to his car and fled the scene.
Further investigation led Doraville and Dunwoody Police Officers to Harbison’s residence and ultimately, officers arrested him. From Harbison’s residence, police officers recovered several items, including: (a) a Springfield .45 caliber handgun, (b) a DEA T-shirt, (c) LED lights, (d) an identification card purportedly issued by the DEA, and (e) a gold and blue badge embossed with the letters “US.” Harbison has previously been convicted of a felony and as a result, could not legally possess the gun.
On April 23, 2015, a grand jury charged Harbison, 40, of Dunwoody, Georgia, with being a felon in possession of a firearm.
Members of the public are reminded that the indictment only contains charges. The defendant is presumed innocent of the charges and it will be the government’s burden to prove the defendant’s guilt beyond a reasonable doubt at trial.
This case is being investigated by the Federal Bureau of Investigation, Doraville Police Department, and Drug Enforcement Administration.
Assistant United States Attorney Jeffrey W. Davis and Special Assistant United States Attorney Erin E. Sanders 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/.
Federal Indictment Charges South Carolina Man with Sex Trafficking of A MinorRead the Press Release
CHARLOTTE, N.C. – A South Carolina man charged with sex trafficking of a minor was arrested yesterday in Columbia, S.C., announced Jill Westmoreland Rose, Acting U.S. Attorney for the Western District of North Carolina. On April 22, 2015, a federal grand jury returned the two-count criminal indictment against Martin Allen Meggett, 27, of West Columbia, S.C.
John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division and Sheriff Bruce Bryant of the York County Sheriff’s Office in South Carolina join Acting U.S. Attorney Rose in making today’s announcement.
The indictment alleges that on or about September 9, 2014 and September 10, 2014, in Mecklenburg County, Meggett knowingly harbored, transported, provided and obtained by any means a person he knew was under 18 for the purpose of engaging in a commercial sex act. The indictment also alleges that Meggett transported the minor across state lines for the purposes of prostitution.
Following his arrest, Meggett had his initial appearance in federal court in Columbia where he remains in federal custody. He will be transferred to the Western District of North Carolina to appear before a U.S. Magistrate Judge when the court schedules his arraignment and detention hearings.
The penalty for each count is a mandatory minimum of 10 years and a maximum of life in prison. 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.
The investigation of the case was jointly handled by the FBI and the York County Sheriff’s Office. The prosecution of the case is handled by Assistant U.S. Attorney Kimlani Ford, of the U.S. Attorney’s office in Charlotte.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Federal Court Sentences Former Elementary School After-School Coordinator on Charge of Production of Child PornographyRead the Press Release
DAVENPORT, IA- On May 1, 2015, Ian Dishon David Isabel, age 30, formerly of Davenport, Iowa, was sentenced by United States District Court Judge James E. Gritzner to 360 months in prison, after pleading guilty to production of child pornography, announced United States Attorney Nicholas A. Klinefeldt. Isabel was also ordered to serve 10 years of supervised release following his term of imprisonment, and to pay $100 towards the Crime Victims Fund. Isabel will also be required to register as a sex offender.
On April 2, 2014, a custodian at Hayes Elementary School discovered what was later determined to be a hidden camera in the girls’ bathroom. The school principal and the Davenport Police Department were notified of the discovery. Isabel was the coordinator of the Stepping Stones after-school program at Hayes Elementary, and was working during the time the custodian found the hidden device. A search by a Davenport police detective found additional hidden devices in the same bathroom. Isabel became aware of the investigation, and fled from the school, claiming illness. The United States Secret Service, Cyber-Crimes Unit, also became involved in the investigation. Items were seized from a subsequent search of Isabel’s residence and a storage unit. Isabel fled and was later arrested on April 11th at a state park in Adams County, Illinois. Additional items were seized from Isabel’s vehicle. A subsequent forensic examination of the computer equipment and storage devices seized found over 100 separate images of children from Hayes Elementary captured during a time period of December 29, 2013 to April 2, 2014. Images found also showed a subject identifiable as Isabel placing the hidden cameras in the bathrooms.
This case was investigated by the United States Secret Service Cyber-Crimes Task Force, the Davenport, Iowa, Police Department and the Adams County, Illinois Conservation Office. The case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
Entrepreneur Sentenced, Ordered to Forfeit $650,000 for Distributing Anabolic Steroids as Dietary SupplementsRead the Press Release
Memphis, TN – Joseph De Melo, Sr., a 59-year-old resident of New Orleans, LA, was sentenced yesterday to 15 months in federal prison for illicitly distributing anabolic steroids and intentionally misbranding a dietary supplement that secretly contained erectile dysfunction drugs.
De Melo owned Rezultz Distribution LLC, a supplement retail store located in Carrollton, Texas. He used the establishment to sell purported dietary supplements throughout the United States, including the Western District of Tennessee.
In September 2012, De Melo began conspiring with individuals to distribute pills of products containing anabolic steroids, which are Schedule III controlled substances. By the time De Mello’s illegal endeavors ended in September 2013, approximately 40,000 pills had been distributed nationwide.
Over the aforementioned time period, De Melo also distributed a purported dietary supplement called "Vertical," which contained unlisted erectile dysfunction drugs; false and misleading ingredients were listed on the drug’s labeling.
De Melo managed to obtain over $650,000 in proceeds from his scheme, which he deposited into various financial accounts. In addition to his sentence, De Melo has agreed to forfeit the proceeds made from his illicit pill distribution.
De Melo was sentenced by U.S. District Judge S. Thomas Anderson. There is no parole offered in the federal prison system.
The case was investigated by the Food and Drug Administration Office of Criminal Investigation. Assistant U.S. Attorneys Tony R. Arvin, Christopher E. Cotten, and Damon K. Griffin represented the government in this case.
Eight Persons Charged with Robbing Metro Drug Dealers; One Charged with Murder of WitnessRead the Press Release
U.S. Attorney Kenneth A. Polite announced that GREGORY DENSON, 52, COREY DENSON, 31, CARL SINGLETON, 30, JOE LEE MILLER, 30, QUINCY JYNES, 27, BRIDGETT MILES, 44, ESCARLITA CARMOUCHE, 48, and ANNETTE ROBINSON, 37, all of New Orleans, were charged today in a fourteen-count Superseding Indictment. All defendants were charged with Conspiracy to violate the Hobbs Act, which prohibits interference with interstate commerce through violence. Defendants DENSON, COREY DENSON, MILLER, JYNES and SINGLETON are also charged with various robberies and weapons offenses. DENSON is charged with the murder of an individual to stop that individual from providing information to law enforcement authorities about his (DENSON’S) activities. MILLER and JYNES are charged with helping to dispose of the body.
COUNT
CHARGE
DEFENDANTS
PUNISHMENT RANGE
1
18 U.S.C.1951-Conspiracy to Commit Hobbs Act Robbery
All
NMT 20 Yrs, NMT $250,000 Fine, NMT 3Yrs Sup. Rel.
2
18 U.S.C.1951-Hobbs Act Robbery
Denson, Miller, Jynes
NMT 20 Yrs, NMT $250,000 Fine, NMT 3Yrs Sup. Rel.
3
18 U.S.C. 924(c)-Brandishing a Firearm during and in relation to a crime of violence
Denson, Miller, Jynes
NMT 7 Yrs Consecutive, NMT $250,000 Fine, NMT 2 Yrs Sup. Rel.
4
18 U.S.C. 922(g)(1)-Felon in Possession of a Firearm
Miller
NMT 10 Yrs, NMT $250,000 Fine, NMT 3Yrs Sup. Rel.
5
18 U.S.C. 922(g)(1)-Felon in Possession of a Firearm
Jynes
NMT 10 Yrs, NMT $250,000 Fine, NMT 3Yrs Sup. Rel.
6
18 U.S.C. 924(c)-Brandishing a Firearm during and in relation to a crime of violence
Denson, Corey, Denson
NMT 7 Yrs Consecutive, NMT $250,000 Fine, NMT 2 Yrs Sup. Rel. As to Deft Jynes, a second conviction results in a consecutive 25 yr sentence
7
18 U.S.C. 922(g)(1)-Felon in Possession of a Firearm
Corey, Denson
NMT 10 Years, NMT $250,000 Fine, NMT 3Yrs Sup. Rel.
8
18 U.S.C.1951-Hobbs Act Robbery
Denson, Miller, Jynes, Singleton, Corey, Denson
NMT 20 Yrs, NMT $250,000 Fine, NMT 3Yrs Sup. Rel.
9
18 U.S.C. 924(c)-Discharging a Firearm during and in relation to a crime of violence
Denson, Miller, Jynes, Corey, Denson, Singleton
NMT 10 Yrs Consecutive, NMT $250,000 Fine, NMT 3Yrs Sup. Rel. As to Defts Denson and Miller, a 2ndconviction results in a consecutive 25 yr sentence. As to Deft Jynes, a 3rd conviction results in a 2nd consecutive 25 yr sentence.
10
18 U.S.C. 922(g)(1)-Felon in Possession of a Firearm
Miller
NMT 10 Yrs, NMT $250,000 Fine, NMT 3Yrs Sup. Rel.
11
18 U.S.C. 922(g)(1)-Felon in Possession of a Firearm
Jynes
NMT 10 Yrs, NMT $250,000 Fine, NMT 3Yrs Sup. Rel.
12
18 U.S.C. 1512-Murder of a Federal Witness
Denson
NMT Life Imprisonment or Death, NMT $250,000 Fine, NMT 5 Years Sup. Rel.
13
18 U.S.C. 3-Accessory After the Fact
Jynes, Miller
NMT 15 Years, NMT $250,000 Fine, NMT 3 Yrs. Sup.Rel.
14
18 U.S.C. 1512(c)(2)-Obstructing an Investigation
Jynes, Miller
NMT 20 Yrs, NMT $250,000 Fine, NMT 3Yrs Sup. Rel.
U.S. Attorney Polite reiterated that the charges in the Indictment are merely charges, and that the guilt of the defendants must be proven beyond a reasonable doubt.
U.S. Attorney Polite praised the work of the Federal Bureau of Investigation and the New Orleans Police Department in investigating this matter. Assistant United States Attorneys Mark A. Miller and Michael M. Simpson are in charge of the prosecution.
Gregory Denson, et al Superseding Indictment
East Saint Louis Man Pleads Guilty to Firearm OffenseRead the Press Release
The United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today that Kasmiel Samuel Sumrall, 28, of East Saint Louis, pled guilty to the charge of Unlawful Possession of a Firearm by a Convicted Felon. The charge carries maximum penalties of ten years in prison, a $250,000 fine, and three years of supervised release. Sumrall is detained (held without bond) pending sentencing set for August 7, 2015.
Court records indicate that Sumrall admitted that on October 6, 2014, in East Saint Louis, he possessed a 9-mm., caliber Ruger semi-automatic pistol handgun, its magazine, and ten rounds of 9-mm., caliber ammunition, after he had previously been convicted on October 30, 2007, of the felony offense of Aggravated Fleeing or Attempting to Elude Police.
The case was investigated by the East Saint Louis Police Department and the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorney Liam Coonan.
Detroit man and Fairmont resident sentenced for drug traffickingRead the Press Release
CLARKSBURG, WEST VIRGINIA – Caraun Lynn-Montez Key, 23, of Detroit, Michigan, and Michael Coy Wollard, 29, of Fairmont, West Virginia, were each sentenced in federal court today for drug trafficking, United States Attorney William J. Ihlenfeld, II, announced.
Wollard was sentenced today to 41 months in prison after he was discovered in Taylor County, West Virginia in September 2014 in possession of a medication containing pseudoephedrine, an ingredient commonly used to manufacture methamphetamine. He pled guilty in January 2015 to one count of “Possession of Pseudoephedrine to be used in the Manufacture of Methamphetamine,” following a Three Rivers Drug Task Force investigation. He will receive credit for time served since October 2014.
Key was sentenced today to 30 months in prison after he was discovered in possession of a significant quantity of oxycodone in Monongalia County, West Virginia in September 2014. He pled guilty in January 2015 to one count of “Aiding and Abetting the Possession with Intent to Distribute Oxycodone,” following a Mon Valley Drug Task Force investigation. He will receive credit for time served since September 2014.
Assistant U.S. Attorney Zelda Wesley prosecuted the cases on behalf of the government.
U.S. District Judge Irene M. Keeley presided.
DeQuincy man pleads guilty to counterfeiting $100 billsRead the Press Release
LAKE CHARLES, La. – United States Attorney Stephanie A. Finley announced that a DeQuincy man pleaded guilty to making $100 counterfeit bills at a casino hotel.
Deldrick Shykil Fowler, 22, of DeQuincy, La., entered a conditional guilty plea on Thursday before U.S. Magistrate Judge Kathleen Kay, to one count of counterfeiting obligations to the United States. The plea will become final when accepted by U.S. District Judge Patricia Minaldi. According to evidence presented at the guilty plea, surveillance equipment was used to observe Fowler on August 12, 2014, at the Isle of Capri Casino in Lake Charles producing counterfeit $100 bills in a hotel room. Law enforcement seized two counterfeit $100 bills, 16 uncut sheets of $100 bills, and 10 uncut sheets of $100 bills printed on only one side.
Fowler faces up to 20 years in prison, five years of supervised release, and a $250,000 fine. A sentencing date of August 6, 2015 was set.
The U.S. Secret Service conducted the investigation. Assistant U.S. Attorneys Robert Abendroth and Howard Parker are prosecuting the case.
Dade City Gang Member Sentenced to 10 Years in Federal PrisonRead the Press Release
Tampa, FL – U.S. District Judge Elizabeth A. Kovachevich today sentenced Chanin Terrell Richardson (29, Dade City) to 10 years in federal prison for possessing with the intent to distribute more than 28 grams of cocaine base and possessing a firearm in furtherance of a drug trafficking crime. He pleaded guilty on August 7, 2014.
According to court documents, law enforcement officers executed a search warrant at Richardson’s Dade City residence after undercover officers had repeatedly purchased cocaine base from the home. Agents found Richardson in possession of more than 40 grams of cocaine base, powder cocaine, prescription pills, heroin, marijuana, a semi-automatic pistol, a short-barreled shotgun, and multiple rounds of ammunition. Richardson has previously been convicted of several felony offenses and is a documented member of the “Dade City Boys” criminal organization.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Federal Bureau of Investigation, and the Pasco Sheriff’s Office. It was prosecuted by Assistant United States Attorney Josephine W. Thomas.
Chalmette Man Indicted for Violations of the Federal Controlled Substances ActRead the Press Release
U.S. Attorney Kenneth A. Polite announced that DAMIEN WILSON, age 35, of Chalmette, was charged in a three-count Indictment for violations of the Federal Controlled Substances Act, which was recently unsealed.
According to the Indictment, WILSON conspired to possess with the intent to distribute and to distribute a kilogram or more of heroin and distributed heroin on two different occasions.
If convicted, WILSON faces a mandatory minimum sentence of ten years up to life imprisonment, followed by at least five years of supervised release, and a fine of up to $10,000,000.
U.S. Attorney Polite reiterated that the Indictment is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
U.S. Attorney Polite praised the work of the Drug Enforcement Administration in investigating this matter. Assistant United States Attorney David Haller is in charge of the prosecution.
Damien Wilson Indictment
CCTV America Interviews Deputy Director on Foreign Terrorist FightersRead the Press Release
On April 20th, CCTV America correspondent Jessica Stone interviewed Interpol Washington Deputy Director Geoff Shank on the U.S. National Central Bureau's efforts to interdict foreign terrorist fighters through Interpol's Foreign Terrorist Fighter (FTF) program. The program, announced in September 2014, leverages the unique resources Interpol utilizes to combat transnational crime, including its secure, encrypted communications system, its criminal and analytical databases and its system of advisory notices.
Watch the full interview at http://www.cctv-america.com/2015/04/20/international-police-work-to-stop-foreign-fighters for more details and success stories of the program and for an insider's look at the Interpol Washington office.
Buffalo Man Charged with Producing and Possessing 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 David Young, 28, of Buffalo, NY, was arrested and charged by criminal complaint with production and possession of child pornography. The production charge carries a minimum sentence of 15 years and a maximum of 30 years in prison and the possession charge carries a maximum penalty of 20 years in prison along with a $250,000 fine.
Assistant U.S. Attorney Michael DiGiacomo, who is handling the case, stated that a West Seneca Schools resource officer obtained information that the defendant had images of child pornography on cellular telephone. The resource officer notified Cheektowaga Police who began an investigation. The investigation resulted in law enforcement officers locating images of child pornography, some that were produced by the defendant.
Young is being held pending a detention hearing scheduled for May 4, 2015 at 3:00 p.m.
The criminal complaint is the result of an investigation by the Federal Bureau of Investigation, Cheektowaga Police Department, under the direction of Chief David Zack and the West Seneca Police Department, under the direction of Chief Daniel Denz.
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.
Buffalo Man Arrested for Drug PossessionRead 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 David Medina, 49, of Buffalo, NY, was arrested and charged by criminal complaint with possession with intent to distribute heroin. The charge carries a maximum penalty of 20 years and a $1,000,000 fine.
Assistant U.S. Attorney Mary Catherine Baumgarten, who is handling the case, stated that according to the complaint, David Medina was arrested in the City of Buffalo, and was in possession of approximately 100 grams of heroin that was to be distributed.
The defendant made an initial appearance this afternoon before U.S. Magistrate Judge H. Kenneth Schroeder, Jr. Medina is being held pending a status conference scheduled for May 13, 2015 at 10:00 a.m.
The criminal complaint is the culmination of an investigation by Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Acting Special Agent in Charge J. Michael Kennedy.
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.
Bookkeeper Pleads Guilty to Embezzling from Non-Profit OrganizationsRead the Press Release
Baltimore, Maryland - Sharon Harrison, age 48, of Rosedale, Maryland, pleaded guilty today to embezzling more than $1.3 million from four non-profit organizations for which she worked and which received federal funding.
The guilty plea 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; Special Agent in Charge Cary A. Rubenstein of the Housing and Urban Development Office of Inspector General; and Robert H. Pearre, Jr., Inspector General, City of Baltimore Office of Inspector General.
“Non-profit organizations that receive federal funds have a legal duty to use them for the intended purpose,” said U.S. Attorney Rod J. Rosenstein. “Sharon Harrison helped herself to federal funds intended to provide services for disadvantaged children and homeless families in Baltimore.”
According to her plea agreement Sharon Harrison was a bookkeeper or fiscal manager for the following non-profit groups, all of which received federal funds to assist in their mission:
Health, Education, Advocacy, Life Inc. (HEAL) from 2005 to March 2011; Between Friends, Inc. from September 2008 to November 2011; Jobs, Housing & Recovery, Inc. (JHR) from May 20, 2013 to February 12, 2014; and Reservoir Hill Improvement Council (RHIC) from December 2012 to February 2014.
HEAL and JHR provided services for the homeless in Baltimore City. Between Friends assisted disadvantaged children to find foster homes and provided services to the children and their foster families. RHIC assessed community needs, developed and implemented solutions on issues common to the Reservoir Hill Community in Baltimore.
Over the course of her employment at HEAL, RHIC, JHR and Between Friends, Harrison embezzled over $1.3 million. Specifically, Harrison admitted that she embezzled: $226,888.34 from HEAL; $784,781.17 from Between Friends; $161,750.14 from JHR; and $133,178.04 from RHIC. As part of her plea agreement, Sharon Harrison agreed to the entry of a restitution order for the full amount of the victim’s losses, $1,306,797.70.
Sharon Harrison faces a maximum sentence of 10 years in prison for federal program theft. U.S. District Judge J. Frederick Motz has scheduled sentencing for June 30, 2015, at 11:00 a.m.
United States Attorney Rod J. Rosenstein praised the FBI, HUD-OIG and Baltimore Office of Inspector General, for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorney Leo J. Wise, who is prosecuting the case.
BNP Paribas Sentenced for Conspiring to Violate the International Emergency Economic Powers Act and the Trading with the Enemy ActRead the Press Release
BNP Paribas S.A. (BNPP), a global financial institution headquartered in Paris, was sentenced today for conspiring to violate the International Emergency Economic Powers Act (IEEPA) and the Trading with the Enemy Act (TWEA) by processing billions of dollars of transactions through the U.S. financial system on behalf of Sudanese, Iranian and Cuban entities subject to U.S. economic sanctions. BNPP was sentenced to a five-year term of probation, and ordered to forfeit $8,833,600,000 to the United States and to pay a $140,000,000 fine. Today’s sentencing is the first time a financial institution has been convicted and sentenced for violations of U.S. economic sanctions, and the total financial penalty—including the forfeiture and criminal fine—is the largest financial penalty ever imposed in a criminal case.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Preet Bharara of the Southern District of New York, Assistant Director in Charge Diego Rodriguez of the FBI’s New York Field Office and Chief Richard Weber of the Internal Revenue Service-Criminal Investigation (IRS-CI) made the announcement. U.S. District Court Judge Lorna G. Schofield of the Southern District of New York imposed the sentence.
“BNP Paribas flouted U.S. sanctions laws to an unprecedented extreme, concealed its tracks, and then chose not to fully cooperate with U.S. law enforcement, leading to a criminal guilty plea and nearly $9 billion penalty” said Assistant Attorney General Caldwell. “BNPP deliberately disregarded the law and provided rogue nations, and Sudan in particular, with vital access to the global financial system, helping that country’s lawless government to harbor and support terrorists and to persecute its own people. Today’s sentence demonstrates that financial institutions will be punished severely but appropriately for violating sanctions laws and risking our national security interests.”
“BNPP, the world's fourth largest bank, has now been sentenced to pay a record penalty of almost $9 billion for sanctions violations that unlawfully opened the U.S. financial markets to Sudan, Iran, and Cuba,” said U.S. Attorney Bharara. “BNPP provided access to billions of dollars to these sanctioned countries, and did so deliberately and secretly, in ways designed to evade detection by the U.S. authorities. The sentence imposed today is appropriate for BNPP’s years-long and wide-ranging criminal conduct.”
“The sentencing of BNP Paribas Bank and the $9 Billion monetary penalty should sound the alarm to international financial institutions thinking of perpetrating these crimes,” said Chief Weber. “The ability of IRS-CI and our partners to expose blatant violations of U.S. embargos and sanctions has changed the way financial matters are handled worldwide. We will continue to use our financial expertise to uncover these types of violations, as well as methodical and deliberate actions to conceal prohibited transactions from U.S. regulators and law enforcement.”
In connection with its guilty plea on July 9, 2014, BNPP admitted that from at least 2004 through 2012, it knowingly and willfully moved over $8.8 billion through the U.S. financial system on behalf of Sudanese, Iranian and Cuban sanctioned entities, in violation of U.S. economic sanctions. The majority of illegal payments were made on behalf of sanctioned entities in Sudan, which was subject to U.S. embargo based on the Sudanese government’s role in facilitating terrorism and committing human rights abuses. BNPP processed approximately $6.4 billion through the United States on behalf of Sudanese sanctioned entities from July 2006 through June 2007, including approximately $4 billion on behalf of a financial institution owned by the government of Sudan, even as internal emails showed BNPP employees expressing concern about the bank’s assisting the Sudanese government in light of its role in supporting international terrorism and committing human rights abuses during the same time period. Indeed, in March 2007, a senior compliance officer at BNPP wrote to other high-level BNPP compliance and legal employees reminding them that certain Sudanese banks with which BNPP dealt “play a pivotal part in the support of the Sudanese government which . . . has hosted Osama Bin Laden and refuses the United Nations intervention in Darfur.”
Similarly, from October 2004 through early 2010, BNPP knowingly and willfully processed approximately $1.74 billion on behalf of Cuban sanctioned entities. BNPP admitted that it continued to do U.S. dollar business with Cuba long after it was clear that such business was illegal. BNPP further admitted that its conduct with regard to the Cuban embargo was both “cavalier” and “criminal.”
BNPP also engaged in more than $650 million of transactions involving entities tied to Iran, and this conduct continued into 2012—nearly two years after the bank had commenced an internal investigation into its sanctions compliance and pledged to cooperate with the government. The illicit Iranian transactions included transactions for a petroleum company based in Dubai that was effectively a front for an Iranian petroleum company and an Iranian oil company.
In accepting BNPP’s guilty plea, Judge Schofield stated that BNPP’s actions “not only flouted U.S. foreign policy but also provided support to governments that threaten both our regional and national security and, in the case of Sudan, a government that has committed flagrant human rights abuses and has known links to terrorism.” Judge Schofield further stated that the forfeiture of over $8 billion will “surely have a deterrent effect on others that may be tempted to engage in similar conduct, all of whom should be aware that no financial institution is immune from the rule of law.”
The Justice Department is exploring ways to use the forfeited funds to compensate individuals who may have been harmed by the sanctioned regimes of Sudan, Iran and Cuba. As a preliminary step in this process, the Justice Department is inviting such individuals or their representatives to provide information describing the nature and value of the harm they suffered. Beginning today (May 1, 2015), interested persons can learn more about this process and submit their information at www.usvbnpp.com, or call 888-272-5632 (within North America) or 317-324-0382 (internationally).
In addition to its federal criminal conviction, BNPP pleaded guilty in New York State Supreme Court to falsifying business records and conspiring to falsify business records. BNPP also agreed to a cease and desist order and to pay a civil monetary penalty of $508 million to the Board of Governors of the Federal Reserve System. The New York State Department of Financial Services announced that BNPP agreed to, among other things, terminate or separate from the bank 13 employees, including the Group Chief Operating Officer and other senior executives; suspend U.S. dollar clearing operations through its New York Branch and other affiliates for one year for business lines on which the misconduct centered; extend for two years a monitorship put in place in 2013; and pay a monetary penalty of $2.24 billion. In satisfying its criminal forfeiture penalty, BNPP will receive credit for payments it made in connection with its resolution of these related state and regulatory matters. The Treasury Department’s Office of Foreign Assets Control also levied a fine of $963 million, which will be satisfied by payments made to the Justice Department.
This case was investigated by the IRS-CI’s Washington Field Office and FBI’s New York Field Office. This case was prosecuted by Deputy Chief Craig Timm and Trial Attorney Jennifer E. Ambuehl of the Criminal Division’s Asset Forfeiture and Money Laundering Section and Assistant U.S. Attorneys Andrew D. Goldstein, Martin S. Bell, Christine I. Magdo and Micah W.J. Smith of the Southern District of New York.
The New York County District Attorney’s Office conducted its own investigation alongside the Justice Department in this case. The Justice Department expressed its gratitude to the Board of Governors of the Federal Reserve, the Federal Reserve Bank of New York, the New York State Department of Financial Services and the Treasury Department’s Office of Foreign Assets Control for their assistance with this matter.
BNP Paribas Sentenced for Conspiring to Violate the International Emergency Economic Powers Act and the Trading with the Enemy ActRead the Press Release
Preet Bharara, United States Attorney for the Southern District of New York, and Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, announced that BNP Paribas S.A. (BNPP), a global financial institution headquartered in Paris, France was sentenced today for conspiring to violate the International Emergency Economic Powers Act (IEEPA) and the Trading with the Enemy Act (TWEA) by processing billions of dollars of transactions through the U.S. financial system on behalf of Sudanese, Iranian and Cuban entities subject to U.S. economic sanctions. BNP Paribas was sentenced to a five-year term of probation, and ordered to forfeit $8,833,600,000 to the United States and pay a fine of $140,000,000. Today’s sentencing is the first time a financial institution has been convicted and sentenced based on its violations of U.S. economic sanctions.
BNPP’s sentencing follows its plea of guilty on July 9, 2014, to conspiring to violate U.S. sanctions laws. As part of its plea, BNPP admitted to moving more than $8.8 billion through the U.S. financial system on behalf of sanctioned entities, including more than $4.3 billion in transactions involving entities that were specifically designated by the U.S. government as being cut off from the U.S. financial system. The total financial penalty imposed on BNPP – $8,973,600,000, including the forfeiture and criminal fine – is the largest financial penalty ever imposed in a criminal case.
U.S. Attorney Preet Bharara said: “BNPP, the world's fourth largest bank, has now been sentenced to pay a record penalty of almost $9 billion for sanctions violations that unlawfully opened the U.S. financial markets to Sudan, Iran, and Cuba. BNPP provided access to billions of dollars to these sanctioned countries, and did so deliberately and secretly, in ways designed to evade detection by the U.S. authorities. The sentence imposed today is appropriate for BNPP’s years-long and wide-ranging criminal conduct.”
Assistant Attorney General Leslie R. Caldwell said: “BNP Paribas flouted U.S. sanctions laws to an unprecedented extreme, concealed its tracks, and then chose not to fully cooperate with U.S. law enforcement, leading to a criminal guilty plea and nearly $9 billion penalty. BNPP deliberately disregarded the law and provided rogue nations, and Sudan in particular, with vital access to the global financial system, helping that country’s lawless government to harbor and support terrorists and to persecute its own people. Today’s sentence demonstrates that financial institutions will be punished severely but appropriately for violating sanctions laws and risking our national security interests.”
Today’s sentencing is part of a resolution announced in July 2014 in which the New York County District Attorney’s Office also announced that BNPP pleaded guilty in New York State Supreme Court to falsifying business records and conspiring to falsify business records. In addition, the Board of Governors of the Federal Reserve System announced that BNPP agreed to a cease and desist order, to take certain remedial steps to ensure its compliance with U.S. law in its ongoing operations and to pay a civil monetary penalty of $508 million. The New York State Department of Financial Services (DFS) announced that BNPP agreed to, among other things, terminate or separate from the bank 13 employees, including the Group Chief Operating Officer and other senior executives; suspend U.S. dollar clearing operations through its New York Branch and other affiliates for one year for business lines on which the misconduct centered; extend for two years the term of a monitorship put in place in 2013 and pay a monetary penalty to DFS of $2.24 billion. In satisfying its criminal forfeiture penalty, BNPP will receive credit for payments it made in connection with its resolution of these related state and regulatory matters. The Treasury Department’s Office of Foreign Assets Control also levied a fine of $963 million, which will be satisfied by payments made to the Department of Justice.
Based on today’s sentencing proceedings and prior filings in the case, BNPP has admitted and acknowledged that from at least 2004 through 2012, it knowingly and willfully moved over $8.8 billion through the U.S. financial system on behalf of Sudanese, Iranian and Cuban sanctioned entities, in violation of U.S. economic sanctions. The majority of illegal payments were made on behalf of sanctioned entities in Sudan, which was subject to U.S. embargo based on the Sudanese government’s role in facilitating terrorism and committing human rights abuses. BNPP processed approximately $6.4 billion through the United States on behalf of Sudanese sanctioned entities from July 2006 through June 2007, including approximately $4 billion on behalf of a financial institution owned by the government of Sudan, even as internal emails showed BNPP employees expressing concern about the bank’s assisting the Sudanese government in light of its role in supporting international terrorism and committing human rights abuses during the same time period. Indeed, in March 2007, a senior compliance officer at BNPP wrote to other high-level BNPP compliance and legal employees reminding them that certain Sudanese banks with which BNPP dealt “play a pivotal part in the support of the Sudanese government which . . . has hosted Osama Bin Laden and refuses the United Nations intervention in Darfur.”
One way in which BNPP processed illegal transactions on behalf of Sudanese sanctioned entities was through a sophisticated system of “satellite banks” set up to disguise both BNPP’s and the sanctioned entities’ roles in the payments to and from financial institutions in the United States. As early as August 2005, a senior compliance officer at BNPP warned several legal, business and compliance personnel at BNPP’s subsidiary in Geneva that the satellite bank system was being used to evade U.S. sanctions: “As I understand it, we have a number of Arab Banks (nine identified) on our books that only carry out clearing transactions for Sudanese banks in dollars… This practice effectively means that we are circumventing the US embargo on transactions in USD by Sudan.”
Similarly, BNPP provided Cuban sanctioned entities with access to the U.S. financial system by hiding the Cuban sanctioned entities’ involvement in payment messages. From October 2004 through early 2010, BNPP knowingly and willfully processed approximately $1.74 billion on behalf of Cuban sanctioned entities. In the statement of facts, BNPP admitted that it continued to do U.S. dollar business with Cuba long after it was clear that such business was illegal in order to preserve BNPP’s business relationships with Cuban entities. BNPP further admitted that its conduct with regard to the Cuban embargo was both “cavalier” and “criminal.” In 2006, after certain Cuban payments were blocked when they reached the United States, the bank decided to strip the wire messages for those payments of references to Cuban entities and resubmit them as a lump sum in order to conceal from U.S. regulators the bank’s longstanding, and illicit, Cuban business.
BNPP also engaged in more than $650 million of transactions involving entities tied to Iran, and this conduct continued into 2012 – nearly two years after the bank had commenced an internal investigation into its sanctions compliance and had pledged to cooperate with the government. The illicit Iranian transactions were done on behalf of BNPP clients, including a petroleum company based in Dubai that was effectively a front for an Iranian petroleum company and an Iranian oil company.
U.S. District Judge Schofield recognized, in her acceptance of BNPP’s guilty plea, that BNPP’s actions “not only flouted U.S. foreign policy but also provided support to governments that threaten both our regional and national security and, in the case of Sudan, a government that has committed flagrant human rights abuses and has known links to terrorism.” The forfeiture of over $8 billion will “surely have a deterrent effect on others that may be tempted to engage in similar conduct, all of whom should be aware that no financial institution is immune from the rule of law.”
The Justice Department is exploring ways to use the forfeited funds to compensate individuals harmed by the sanctioned regimes of Sudan, Iran, and Cuba. In an effort to better understand who may have been harmed by these regimes, the Justice Department is inviting individuals or their representatives to provide information describing the nature and value of the harm they suffered. Beginning today (May 1, 2015), interested persons can learn more about this process and submit their information at www.usvbnpp.com, or call 888-272-5632 (within North America) or 317-324-0382 (internationally).
In addition to its federal criminal conviction, BNPP pleaded guilty in New York State Supreme Court to falsifying business records and conspiring to falsify business records. BNPP also agreed to a cease and desist order and to pay a civil monetary penalty of $508 million to the Board of Governors of the Federal Reserve System. The New York State Department of Financial Services announced that BNPP agreed to, among other things, terminate or separate from the bank 13 employees, including the Group Chief Operating Officer and other senior executives; suspend U.S. dollar clearing operations through its New York Branch and other affiliates for one year for business lines on which the misconduct centered; extend for two years a monitorship put in place in 2013; and pay a monetary penalty of $2.24 billion. In satisfying its criminal forfeiture penalty, BNPP will receive credit for payments it made in connection with its resolution of these related state and regulatory matters. The Treasury Department’s Office of Foreign Assets Control also levied a fine of $963 million, which will be satisfied by payments made to the Justice Department.
This case is being prosecuted by the Money Laundering and Asset Forfeiture Unit of the U.S. Attorney’s Office for the Southern District of New York and the Money Laundering and Bank Integrity Unit of the Criminal Division’s Asset Forfeiture and Money Laundering Section (AFMLS). Assistant U.S. Attorneys Andrew D. Goldstein, Martin S. Bell, Christine I. Magdo, and Micah W.J. Smith of the Southern District of New York and Deputy Chief Craig Timm and Trial Attorney Jennifer E. Ambuehl of AFMLS are in charge of the prosecution.
The New York County District Attorney’s Office also conducted its own investigation alongside the Department of Justice on this investigation. Mr. Bharara and Ms. Caldwell expressed their gratitude to the Board of Governors of the Federal Reserve, the Federal Reserve Bank of New York, the New York State Department of Financial Services and the Treasury Department’s Office of Foreign Assets Control for their assistance with this matter. They also thanked the Federal Bureau of Investigation’s New York Field Office and the Internal Revenue Service-Criminal Investigation’s Washington Field Division for their work on the investigation.
Alleged Leader of the Lorenzana Drug Trafficking Organization Extradited to the United StatesRead the Press Release
An alleged leader of an international drug trafficking organization based in Guatemala was extradited to the United States yesterday to face international narcotics trafficking charges in the District of Columbia, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division.
Eliu Elixander Lorenzana-Cordon, 43, was arrested in Guatemala on Nov. 8, 2011, after being indicted for conspiracy to import cocaine into the United States, and has been detained since that time pending extradition. He arrived in the United States yesterday and was arraigned today before U.S. Magistrate Judge Alan Kay of the District of Columbia.
According to allegations contained in the indictment, Lorenzana-Cordon is a leader of an international drug trafficking organization that includes his father and several other family members. Between 1996 and 2012, the organization allegedly received and stored multi-ton quantities of cocaine from Colombia for later importation into Mexico and the United States.
These cocaine shipments, worth millions of dollars, were allegedly transported to El Salvador on “go-fast” boats, and then smuggled into Guatemala by land and air. The cocaine was then inventoried and stored for later export to Mexico and eventually the United States.
On April 27, 2010, the Department of Treasury’s Office of Foreign Asset Control designated Lorenzana-Cordon as a Specially Designated Narcotics Trafficker pursuant to the Foreign Narcotics Kingpin Designation Act due to his significant role in international narcotics trafficking and his ties to the Sinaloa Cartel.
The charges in the indictment are merely allegations, and the defendant is presumed innocent unless and until proven guilty.
Lorenzana-Cordon’s brother, Waldemar Lorenzana-Cordon, was extradited to the United States on Nov. 13, 2014, and is currently awaiting trial. Lorenzana-Cordon’s father, Waldemar Lorenzana-Lima, pleaded guilty on Aug. 18, 2014, to conspiracy to import over 450 kilograms of cocaine into the United States, and is currently awaiting sentencing. All three defendants were charged in the same indictment.
The investigation was led by the DEA’s 959/Bilateral Investigations Unit and Guatemala City Country Office, and was part of the Organized Crime Drug Enforcement Task Force. The case is being prosecuted by the Criminal Division’s Narcotic and Dangerous Drug Section. The Criminal Division’s Office of International Affairs provided significant assistance in the extradition. The department appreciates the assistance provided by the government of Guatemala.