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Wednesday 11 March 2015
Menominee County Man Indicted for Sex Offender Registry ViolationRead the Press Release
United States Attorney James L. Santelle for the Eastern District of Wisconsin, announced that on March 10, 2015, a federal grand jury returned a single count indictment against William A. Julius (age: 53) of Menominee County, Wisconsin, charging him with failure to update his registration as a sex offender pursuant to Title 18, United States Code, §2250(a). If convicted of this offense, the defendant faces a sentence of up to 10 years imprisonment, a two hundred and fifty thousand dollar fine, and between five years and a lifetime of supervised release.
According to the indictment, Julius failed to comply with the requirements of the Sex Offender Registration and Notification Act which requires registered sex offenders to maintain information as to their current place of residency.
The case was investigated by the United States Marshal’s Service. The case is being prosecuted by Assistant United States Attorney Daniel R. Humble.
An indictment is only a charge and not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
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Mechanicsburg Man Sentenced for Illegal Sports Gambling OperationRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a 40-year old Mechanicsburg man was sentenced today before Senior U.S. District Court Judge William C. Caldwell to 5 months in federal prison followed by 5 month’s house arrest. Sheely is to report for service of his sentence on April 7, 2015.
Steven Sheely, Jr., pled guilty on December 4, 2014, to being involved with his father, Steven Sheely, Sr., and seven other named individuals, in a conspiracy to run an illegal sports gambling operation.
According United States Attorney Peter Smith, Sheely, Sr. and the others took in millions of dollars in illegal bets on all manners of sporting events. The bookmaking activity took place mainly in the central Pennsylvania area where the participants in the organization lived. The organization was dismantled primarily through the use of a court authorized wiretap and the arrest of the participants on May 22, 2014.
The prosecution stemmed from an investigation conducted by the Federal Bureau of Investigation, the Commonwealth of Pennsylvania’s Department of Agriculture’s Racing Commission, and the Pennsylvania State Police. Assistant United States Attorney William A. Behe was assigned to handle the investigation and prosecution of the case.
Maryland Man Sentenced to 56 Months in Prison for Assaulting Transgender Girl on Metrorail Train Defendant Threatened, Harassed and Stabbed 15-Year-Old VictimRead the Press Release
WASHINGTON – Reginald Klaiber, 25, of Greenbelt, Md., was sentenced today to 56 months in prison for stabbing a transgender girl while she was on board a Metrorail train, U.S. Attorney Ronald C. Machen Jr. announced.
Klaiber, also known as Reginald Kaliber, pled guilty in January 2015, in the Superior Court of the District of Columbia, to a charge of assault with a dangerous weapon, with a hate crime enhancement. He was sentenced by the Honorable Juliet McKenna, who described the assault as “brutal.”
“Hate crimes against transgender people occur with troubling frequency and demand a forceful response,” said U.S. Attorney Machen. “Reginald Klaiber stabbed a 15-year-old girl on the Metro solely because of who she is. This prison sentence should make clear that we will not tolerate hate-fueled violence in the District of Columbia.”
According to the government’s evidence, Klaiber confronted the 15-year-old victim on July 30, 2014, at about 4:30 p.m., while both were on a Green Line train approaching the Fort Totten Metro station in Northeast Washington. The victim, who was dressed in women’s clothing, was with two of her friends on the train. Klaiber attempted to engage her in conversation and she asked him to leave her alone. Klaiber began harassing her, saying, among other things, “Are you a boy, you are a boy, right?” and “Why you be looking like a woman?”
The victim again asked Klaiber to leave her alone and to get away. As the train pulled into the Fort Totten station, she stood up. Klaiber stood up as well, pulled out a knife, grabbed the victim in a bear hug and stabbed her in the back. One of the victim’s friends sprayed Klaiber in the face with Mace or pepper spray. Klaiber released the victim, and she and her friends fled through interior train doors into a different Metro car. Klaiber continued to follow them until the exterior doors opened. The victim and her friends then ran into the Metro station, with Klaiber making threatening and harassing statements as he kept following them.
One of the friends pointed out the defendant to Metro Transit Police officers, who apprehended him just outside the station. Police recovered a black folding knife with a three-inch, partially serrated blade in a search of the defendant.
The victim, who later identified Klaiber as her assailant, required medical treatment for her injuries.
Klaiber has been in custody since his arrest.
When he committed the crime, Klaiber was on probation in two other Superior Court cases before the Honorable Patricia A. Broderick for attempted robbery and possession of a prohibited weapon, a knife. As a result of the defendant’s plea in this case, Judge Broderick revoked Klaiber’s probation and sentenced him to 20 months on the attempted robbery charge and five months on the weapon charge. Those sentences will run consecutive to the sentences in the new case. In total, Klaiber was sentenced to nearly seven years in prison.
In announcing the sentence, U.S. Attorney Machen commended the work of the Metro Transit Police. He also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Supervisory Victim/Witness Advocate Jennifer Clark and Assistant U.S. Attorney Christopher Bruckmann, who prosecuted the case.
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Media AdvisoryRead the Press Release
CHARLESTON, W.Va. – Effective immediately, Michael Shane Arrington, former Public Affairs Specialist for United States Attorney Booth Goodwin’s office, is no longer employed with the office. Please forward all press inquiries to www.justice.gov/usao/wvs or to Robin Justice at (304)345-2200.
Lone Ranger Bandit Sentenced to 40 Years in Federal Prison for Series of Armed Bank RobberiesRead the Press Release
In Waco today, a federal judge sentenced 38-year-old Richard Wayne Swicegood (aka “Lone Ranger Bandit”) of Waxahachie, TX, to 40 years in federal prison for committing 13 armed bank robberies in Texas and Arkansas announced Acting United States Attorney Richard L. Durbin, Jr. and Special Agent in Charge Christopher Combs of the FBI’s San Antonio Division.
In addition to the prison term, U.S. District Judge Walter S. Smith, Jr. ordered that Swicegood pay $119,815.00 restitution to the financial institutions and be placed on supervised release for a period of five years after completing his prison term.
On January 15, 2015, Swicegood pleaded guilty to 13 counts of bank robbery. By pleading guilty, Swicegood admitted that he committed the following robberies:
- Temple Santa Fe Community Credit Union in Temple, TX, on October 4, 2011; March 30, 2012; and July 12, 2013, stealing a total of approximately $72,330.
- Union State Bank in Round Rock, TX, on January 4, 2012, and June 5, 2014, stealing a total of approximately $10,780.
- First State Bank in Salado, TX, on July 9, 2012, stealing approximately $5,075.
- Extraco Bank in Lampasas, TX, on November 8, 2013, stealing approximately $2,450.
- Select Federal Credit Union in San Antonio, TX, on March 6, 2014, stealing approximately $9,500.
- Citibank in Wichita Falls, TX, on July 21, 2011, stealing approximately $8,640.
- Altra Federal Credit Union in Tyler, TX, on August 31, 2011, stealing approximately $5,290.
- BBVA Compass Bank in Tyler, TX, on May 17, 2012, stealing approximately $2,750.
- Summit Bank in Benton, AR, on June 30, 2011, and July 1, 2014, stealing a total of approximately $16,220.
On July 1, 2014, following the Summit Bank robbery, an Arkansas state trooper near Benton initiated a stop on the purported bank robbery suspect’s vehicle. Swicegood was arrested after the trooper located a fake firearm and the stolen money inside Swicegood’s vehicle.
This case was investigated by the Federal Bureau of Investigation (FBI) with assistance from the Texas Rangers; San Antonio, Temple, Round Rock, Wichita Falls, Tyler, Lampasas, and Salado Police Departments in Texas; Benton (AR) Police Department; and, the Arkansas State Police. Assistant United States Attorney Greg Gloff prosecuted this case on behalf of the Government.
Licensed Clinical Social Worker Sentenced to Prison for Health Care FraudRead the Press Release
BATON ROUGE, LA –United States Attorney Walt Green announced that CARLA CLARK, age 50, of Pineville, Louisiana, was sentenced yesterday by Chief U.S. District Judge Brian A. Jackson to 21 months imprisonment, 2 years of supervised release following imprisonment, and ordered to pay $413,109 in restitution for her role in a health care fraud scheme involving two Louisiana companies.
The sentencing stems from a health care fraud scheme involving two companies known as Fusion Services, L.L.C. (“Fusion”), and Grace Social Services, L.L.C. (“Grace”), which operated in Alexandria, Louisiana and the surrounding areas. CLARK was a Licensed Clinical Social Worker who worked with Sonya Williams, the owner of Fusion and Grace. CLARK participated in creating false and misleading medical records for Fusion indicating that Medicare beneficiaries had received individual, face-to-face psychotherapy when, in fact, no such services had been provided. Williams then prepared false claims for the purported psychotherapy services to elderly patients and submitted them to Medicare for reimbursement. Medicare paid Fusion and Grace approximately $349,715 as a result of the billings, much of the profits were deposited into Williams’ personal accounts.
In addition to the term of imprisonment, Judge Jackson ordered CLARK to pay restitution in the amount of $413,109 to the Department of Health and Human Services/Centers for Medicare and Medicaid Services for her role in the fraudulent conduct involving Fusion and Grace, as well as other health care entities.
U.S. Attorney Green stated, “This sentencing is part of the continuing effort by my office and our federal, state, and local partners to combat the scourge of health care fraud. Corrupt medical professionals, like the defendant in this case, do an incredible disservice to the vast majority of medical professionals who are honest and committed to quality patient care. Together with the help and cooperation of those honest professionals, we will continue our pursuit of fraudsters in the medical community.”
“Any time false claims are submitted for payment, the nation's health insurance programs suffer,” said Special Agent-in-Charge Mike Fields of the HHS Office of the Inspector General’s (OIG) Dallas Regional Office. “Our HHS OIG investigators will continue to work closely with our law enforcement partners to identify providers who deliberately manipulate the system to obtain crucial Medicare or Medicaid dollars.”
The investigation was conducted by the U.S. Department of Health and Human Services’ Office of Inspector General (HHS-OIG) and the Federal Bureau of Investigation (FBI), with the assistance of AdvanceMed, the Medicare Program Safeguard Contractor which assists with health care fraud investigations. The case was prosecuted by Assistant United States Attorney Catherine M. Maraist.
Leavenworth Man Pleads Guilty to Theft of Government FundsRead the Press Release
KANSAS CITY, KAN. - A Leavenworth man pleaded guilty Wednesday to fraudulently collecting more than $46,000 in government benefits, U.S. Attorney Barry Grissom said.
Michael James Munsterman, 42, Leavenworth, Kan., pleaded guilty to one count of theft of government funds. In his plea, he admitted he received Supplemental Security Income, food stamps and Medicaid even though he did not qualify for those benefits. In April 2011 he applied for SSI benefits claiming that he had a drug-induced heart condition that prevented him from working. He did not reveal to the government that he owned and operated a heating and cooling company and received substantial income from the business while he was receiving benefits. He also admitted that he concealed from the federal government his financial resources that far exceeded the eligibility criteria of the aforementioned needs-based programs.
He fraudulently received a total of approximately $46,367 in government funds.
Sentencing is set for June 16, 2015. He faces a maximum penalty of 10 years in federal prison and a fine up to $250,000. Pursuant to the plea agreement, Munsterman must also pay restitution to the victim-agencies. Grissom commended the Social Security Administration’s Office of Inspector General and Special Assistant U.S. Attorney Trey Alford for their work on the case.
Leader of Counterfeit Credit Card Ring Sentenced to 9 Years in PrisonRead the Press Release
Baltimore, Maryland – U.S. District Judge William D. Quarles, Jr. sentenced Michael Crew, age 54, of Owings Mills, Maryland, today to nine years in prison followed by three years of supervised release, after Crew pleaded guilty to bank fraud conspiracy and aggravated identity theft, arising from his use of stolen credit and debit cards to manufacture counterfeit credit cards used to buy merchandise and services. Judge Quarles also entered an order that Crew pay restitution of $126,318.99, the amount of the actual loss to victims.
The plea and sentence were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Brian Murphy of the United States Secret Service - Baltimore Field Office; Chief Gary Gardner of the Howard County Police Department; Commissioner Anthony W. Batts of the Baltimore Police Department; Chief James W. Johnson of the Baltimore County Police Department; Chief Ross C. Buzzuro of the Ocean City Police Department; Special Agent in Charge William Winter of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Newport News Police Chief Richard W. Myers; and Colonel William M. Pallozzi, Acting Superintendent of the Maryland State Police.
According to his plea agreement, Crew had an embossing machine, and made credit cards using altered gift cards and the credit card and debit card numbers stolen from others. The stolen credit card account numbers were obtained from a variety of sources. Once a valid number was obtained, co-defendants would use an algorithm to derive other valid numbers, which they would confirm by calling customer service for the issuing financial institution. These numbers were used to manufacture counterfeit access devices bearing the stolen credit and debit card account numbers. The counterfeit access devices were then used to make unauthorized purchases of goods and services.
Generally the gift cards used to manufacture the counterfeit credit cards were shoplifted from stores. For example, on June 13, 2012, Crew was arrested when he attempted to shoplift gift cards at the Shoppers Food Warehouse in Howard County. Crew received a citation and was released.
Crew generally did not use the counterfeit credit cards himself, but either sold them or had others use them. Sometimes he told them what to purchase, such as gift cards, electronics and luxury linens which he resold.
On March 12, 2013, a search warrant was executed at Crew’s residence. Dozens of counterfeit gift cards were recovered bearing stolen credit card numbers and, in some cases, the names of co-defendants; numerous receipts from items purchased with counterfeit cards, 122 blank plastic cards, computers, cell phones, notes with credit card account information, and a notebook containing credit card numbers.
During the conspiracy, which continued through the arrest of the final defendants on June 7, 2014, Crew and his co-conspirators accessed or attempted to access credit card accounts with credit limits of between $400,000 and $1 million, using the financial account numbers of real people. More than 250 individuals and institutions were defrauded by the scheme.
To date, five other defendants have pleaded guilty to their participation in the scheme and await sentencing.
The Maryland Identity Theft Working Group has been working since 2006 to foster cooperation among local, state, federal, and institutional fraud investigators and to promote effective prosecution of identity theft schemes by both state and federal prosecutors. This case, as well as other cases brought by members of the Working Group, demonstrates the commitment of law enforcement agencies to work with financial institutions and businesses to address identity fraud, identify those who compromise personal identity information, and protect citizens from identity theft.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Since the inception of FFETF in November 2009, the Justice Department has filed more than 12,841 financial fraud cases against nearly 18,737 defendants including nearly 3,500 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
United States Attorney Rod J. Rosenstein commended the U.S. Secret Service; Howard County, Baltimore City, Baltimore County, Howard County, Ocean City and Newport News Police Departments, HSI Baltimore and Maryland State Police for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Tamera L. Fine, who prosecuted the case.
Lawrence Woman Sentenced for EmbezzlementRead the Press Release
TOPEKA, KAN. - A Lawrence woman was sentenced Wednesday to 24 months in federal prison for embezzlement and ordered to pay $837,000 in restitution to her former employer, U.S. Attorney Barry Grissom said.
Sharon Ann Holladay, 58, Lawrence, Kan., pleaded guilty to one count of embezzlement. In her plea, she admitted the crime occurred while she worked as an officer manager for Westheffer Company, a Lawrence business that manufactures and sells agricultural chemical spray equipment.
Holladay used her access to the company’s financial system to transfer money from the operations account to a petty cash fund she controlled. She also used her access to the payroll system to give herself unauthorized bonuses and commissions. In addition, she made unauthorized purchases on the company’s credit card.
Grissom commended the Lawrence Police Department, the FBI and Assistant U.S. Attorney Rich Hathaway for their work on the case.
Laurel Man Admits to Robbery, Abduction and Sexual Assault of ProstitutesRead the Press Release
Greenbelt, Maryland – Ajibola Erogbogbo, age 19, of Laurel, Maryland, pleaded guilty today to robbery.
The plea agreement 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; Anne Arundel County Police Chief Tim Altomare; Chief Richard McLaughlin of the Laurel Police Department; Anne Arundel County State’s Attorney Wes Adams; Chief Mark A. Magaw of the Prince George’s County Police Department; and Prince George’s County State’s Attorney Angela D. Alsobrooks.
According to his plea agreement, Erogbogbo was a security guard at Six Flags amusement park in Largo, Maryland, and a student at Anne Arundel Community College.
On January 9, 2014, a prostitute posted an ad for sex on the internet and Erogbogbo arranged a “date” at a hotel in Linthicum Heights, Maryland. Erogbogbo arrived wearing a vest that read “POLICE,” and had a metallic badge in one hand and a gun in the other. He told the prostitute that she was under arrest and instructed her to write her name and personal information on a yellow notepad he brought with him. Erogbogbo then handcuffed the woman, took her driver’s license and asked about her involvement in prostitution. Erogbogbo removed the handcuffs and demanded money. The woman responded that she did not have any cash. While Erogbogbo searched her belongings and the hotel room, the woman secretly sent a text message to another prostitute working in the same hotel, who knocked on the hotel door.
Erogbogbo answered the door, took out his gun and pointed it at the second prostitute. He handcuffed both women. When he couldn’t find any money, Erogbogbo ordered the second prostitute to write down her phone number and leave the hotel, leaving the initial prostitute with him.
Erogbogbo took the prostitute out to the side entrance of the hotel, telling her that she was going to jail. As they headed towards his parked vehicle, the prostitute broke free and ran back to the front desk yelling for help. The front desk attendant called 911. Erogbogbo fled in his vehicle. Anne Arundel County Police responded and recovered surveillance video footage from the hotel showing Erogbogbo arriving at the hotel, entering the lobby wearing a vest and attempting to take the prostitute away from the hotel.
On January 11, 2014, Erogbogbo again phoned the prostitute after she posted a new commercial sex ad and attempted to arrange another “date.” Based on the information provided by the prostitute, members of the Maryland Child Exploitation Task Force (MCETF) arrived in the area of the hotel and set up surveillance. Erogbogbo, however, never appeared.
A third prostitute told MCETF members that she had arranged a “date” with Erogbogbo who called her after she had posted an online prostitution ad. A fourth prostitute hid in the closet as a precaution. When Erogbogbo arrived in the hotel room, he identified himself as a police officer and placed the prostitute in handcuffs. Erogbogbo was wearing a vest that read “POLICE”, a law enforcement belt, a holstered gun on the right side and a second gun in a left-side drop holster. Erogbogbo also showed her a metallic badge. When the fourth prostitute emerged from the closet, Erogbogbo demanded that they give him their prostitution money. The prostitutes gave Erogbogbo a total of $1,400. Erogbogbo returned $600 to the fourth prostitute and took $800 from the third prostitute. Erogbogbo wrote a phone number on a piece of yellow paper, told the victims to call him if they needed future assistance from the police, removed the handcuffs and left.
On February 19, 2014, MCETF personnel met another prostitute who said that she too had been recently robbed by Erogbogbo. Erogbogbo had made a “date” with this fifth prostitute from her online post. When he arrived at her hotel room, he said that he was a police officer in the “Human Trafficking Unit.” He showed a badge, and wore a ballistic vest with a “POLICE” patch, and carried a radio that he periodically spoke into. He also carried a handcuff pouch, handcuffs and a gun in a leather holster. After asking the woman several questions regarding her involvement in prostitution, Erogbogbo said that the “only way” to avoid arrest was to have sex with him. The woman at first refused. When she would not take off her clothing, Erogbogbo threatened to put handcuffs on her. He began having sex with her, but stopped when she became unresponsive.
The next day, the prostitute posted a new online prostitution ad under the direction of MCETF. Erogbogbo contacted her to make a “date.” Although she had not told Erogbogbo her exact location, Erogbogbo soon walked into the hotel lobby en route to the “date.” When Erogbogbo encountered the Laurel City Police in the lobby, he attempted to flee. He was stopped by the police as he was attempting to re-enter his vehicle parked outside of the hotel. Erogbogbo was wearing a gold Six Flags Loss Prevention badge and a Smith and Wesson replica BB gun, holstered on his belt.
Police searched Erogbogbo’s residence and vehicle and recovered handcuffs, radios, pepper spray, badge holders and a yellow notepad that contained names, driver’s license numbers, phone numbers and addresses of women, including the prostitutes previously described.
Erogbogbo faces a maximum sentence of 20 years in prison and $250,000 fine. U.S. District Judge Theodore D. Chuang scheduled sentencing for June 19, 2015 at 2:00 p.m.
United States Attorney Rod J. Rosenstein commended the FBI, Anne Arundel County and Prince George’s County Police Departments, Laurel Police Department, Anne Arundel County and Prince George’s County State’s Attorney’s Offices and Maryland Child Exploitation Task Force for their work in the investigation and prosecution. Mr. Rosenstein thanked Assistant United States Attorneys Daniel C. Gardner and James A. Crowell IV, who are prosecuting the case.
Laurel Couple Sentenced to Federal Prison for Role in Rocky Boy's Corruption ProbeRead the Press Release
GREAT FALLS – A husband and wife linked to corruption on the Rocky Boy’s Indian Reservation were both given two-year federal prison sentences today in Great Falls. Mark Craig Leischner,48, and Tammy Kay Leischner,43, of Laurel were sentenced by U.S. District Judge Brian Morris following their guilty pleas to multiple felonies. Mark Leischner, who plead guilty to embezzlement of over $200,000 in funds from the Chippewa Cree Tribe Rodeo Association, federal student financial aid fraud, and obstruction of justice, was sentenced to 24 months in prison. Tammy Leischner, who plead guilty to aiding the embezzlement of $311,000 in federal funds, bankruptcy fraud, federal student financial aid fraud, and blackmail, was also sentenced to 24 months in prison. Following their incarceration, both will be on federal supervised release for three years. Mark Leischner was ordered to pay $281,313 in restitution, and Tammy Leischner was ordered to pay $375,092 in restitution.
Theft of Federal Funds
Tammy Leischner plead guilty to assisting and participating in the embezzlement of hundreds of thousands of dollars in American Recovery and Reinvestment Act (ARRA) funds provided by the Bureau of Reclamation for the Rocky Boy’s water project.
Prosecutors presented evidence that Tony Belcourt, then the Chief Executive Officer of the Chippewa Cree Construction Corporation, in anticipation of receiving $20 million in ARRA funds in September 2009, solicited bids for the supply and delivery of the pipe needed for the Tiber Reservoir water project. At some point prior to a telephone meeting on January 27, 2010, RPK Transport of Joliet, Montana, was selected as the shipper for the pipe. RPK did in fact provide all of the shipping for the pipe, invoiced the cost, and was paid $348,950, by Tammy Leischner and James Howard Eastlick, Sr. doing business as T. Leischner Consulting.
Although a contract for the supply and delivery (shipping) of pipe was in place with Northwest Pipe, the pipe manufacturer, and a shipper—RPK Transport—had been selected to haul the pipe from Colorado to Montana, Belcourt awarded a separate shipping contract to T. Leischner Consulting on January 28, 2010, for $495,000.
In February 2010, Belcourt approved an advance payment of $165,000 (one-third of the contract price) in ARRA funds to the newly created business entity, T. Leischner Consulting. On March 1, 2010, James Howard Eastlick wire transferred $101,000 of the $165,000 deposit, to the bank account of MT Waterworks, a retail sales pipe supply company, at Yellowstone Bank in Billings. Like the T. Leischner account, the MT Waterworks account was newly created; created only two weeks earlier, on February 19, 2010, by Tony Belcourt and two business partners. The $101,000 wired from T. Leischner Consulting purchased a controlling financial interest in the enterprise for Belcourt, and the company relied on a “minority owned” status for preferential treatment in federal construction projects based on Belcourt’s tribal enrollment with the Chippewa Cree Tribe.
An invoice for services was created by T. Leischner Consulting and dated March 25, 2010, in the full amount of $495,000—even though it had already received a full one-third of the contract amount in February. Leischner presented this invoice to Northwest Pipe through the project’s procurement agent. Between March 26 and April 23, 2010, in a series of financial transactions, $495,000 in ARRA funds were provided to Leischner.
Shortly after the $495,000 was deposited on April 26 into Leischner’s account, James Eastlick Sr. wired $200,000 to the Chippewa Cree Rodeo Association account in Havre. One month later two checks were issued from the Rodeo account to Mark Leischner which totaled $133,000. That money was deposited into the Leischner’s personal account at Stockman Bank. Ten days after that deposit, on July 2, Tammy Leischner bought a $62,000 cashier’s check from Stockman Bank made payable to Hill County Title. That cashier’s check was used by Hailey Belcourt on July 7 to buy a residence in Box Elder, which the Belcourt’s used as a rental property.
Embezzlement from the Rodeo Account and Obstruction of a Grand Jury investigation
Mark Leischner plead guilty to assisting John Chance Houle, a tribal official and the President of the Chippewa Cree Rodeo Association (CCRA) embezzle funds from the rodeo association accounts by serving as a nominee vendor and then kicking money back to Houle and his brother-in-law, James Eastlick, Jr. and obstructing a Grand Jury investigation.
Beginning in 2009, Houle and Eastlick devised a scheme whereby they could embezzle funds from the rodeo association account using nominee vendors willing to kick-back a portion of the proceeds to Houle and Eastlick. In 2009, Mark Leischner received $135,000 in checks from Houle, and kicked-back to Eastlick approximately $53,000. Of the $135,000, according to the forensic investigation of Leischner’s bank accounts by case agents, only $33,750 was actually spent on saddles to be used for rodeo prizes. In June 2010, Houle wrote two rodeo association checks to Mark Leischner totaling $133,000. Of the $133,000, the investigation determined that approximately $16,000 was spent on rodeo prizes (i.e., saddles and belt buckles) and $62,000 was kicked-back to Belcourt for the purchase of a residence in Box Elder.
On March 19, 2013, a Grand Jury subpoena was issued ordering Mark Leischner to appear before the Grand Jury on April 3, 2013, and to produce certain documents relating to his contracts with the CCRA in 2009 and 2010. Between January and June of 2013, Houle, Eastlick, and the Leischners met between three and five times to discuss the manufacture of, and create, “back-up” documents that would satisfy investigators, and the Grand Jury, that the transactions were legitimate rodeo contract payments. On July 25, 2013, documents were provided by Leischner to the Grand Jury. Most were determined to be fabricated documents manufactured between January and June of 2013.
Bankruptcy Fraud and Federal Student Financial Aid Fraud
Brenden Leischner, son of Mark and Tammy Leischner, applied for admission and was accepted to the University of Great Falls (UGF) in the Fall of 2009 as a Criminal Justice major. As part of that process, the Leischners completed the first of several Free Application for Federal Student Aid (FAFSA) forms to qualify Brenden for federal student aid. Both Brenden and his parents provided information, on-line, in the completion and submission of the FAFSA. The Leischners received in excess of $1.1 million dollars into their accounts during the period of Brenden Leischner’s enrollment at UGF that was not declared on any application for federal student assistance. Mark and Tammy Leischner were sentenced for their guilty pleas to defrauding the U.S. Department of Education. Brenden Leischner was sentenced in December of 2014 to six months in custody and 5 years of probation for his role in the fraud.
On October 2, 2012, the Leischners filed for bankruptcy in U.S. Bankruptcy Court, Case No. 12-61597-RBK. On October 19 they filed their schedules in support of the petition. The Leischners did not reveal then, or at any time subsequent, the $165,000 from CCCC, the $495,000 from Northwest Pipe, or the $133,000 from the Rodeo Association. They also did not disclose the existence of the Stockman Bank account, which had been opened in May of 2010, or the Altana FCU account of T Consulting, through which the pipe-shipping contract payments, totaling $660,000, passed.
Tammy Leischner was sentenced on her plea of guilty to bankruptcy fraud.
Blackmail
On October 17, 2014, a letter from Tammy Leischner was delivered to Jim Eastlick Jr.s home addressed to his wife, which read, in part that “To the issue of the criminal charges, I have a handwriting expert highly accredited in state and federal courts, ........, who is prepared to write a report and testify to the fact the signatures on the contracts, are not James Eastlick Jrs' and are in fact [his wife’s]… As a direct result of your actions I am requesting damages of $ 595,000.00 dollars. If payment is received by November 7, 2014 I will wave my right to pursue a civil action, the criminal charges, and informing the federal judge. …If I am not successful trying to mitigate this by November 7, 2014 I will promptly file criminal charges with Joe Waller, inform Honorable Brian Morris, ….” Subsequent investigation verified that Tammy Leischner had sent the threatening letter.
Tammy Leischner plead guilty to a charge of blackmail and was sentenced today for that offense.
Because there is no parole in the federal system, the “truth in sentencing” guidelines mandate that the Leischners will likely serve all of the time imposed by the court. In the federal system, defendants do have the opportunity to earn a limited reduction in time served for “good behavior,” a reduction for good conduct while incarcerated will not exceed 15% of the overall sentence.
Laguna Pueblo Man Pleads Guilty to Assaulting his Intimate Partner by Strangulation and Attempted ManslaughterRead the Press Release
ALBUQUERQUE – Duane Day, 25, a member and resident of Laguna Pueblo, N.M., pleaded guilty in federal court in Albuquerque, N.M., this morning to an assault and attempted manslaughter charges arising out of the strangulation of his intimate partner.
Day was arrested on May 22, 2014, on a criminal complaint charging him with attempt to commit manslaughter, assault of an intimate partner by strangling, and child abuse. According to the complaint, on May 12, 2014, in Laguna Pueblo within Cibola County N.M., Day assaulted the victim, a Laguna Pueblo woman, by strangling her and causing her to lose consciousness. It further alleges that Day fled the scene of the assault with the victim’s two young children, an 11-month-old and a two-year-old, to a nearby mesa. The complaint further alleges that the victim suffered a severe stroke as a result of the strangulation which required her to undergo emergency brain surgery to relieve swelling and bleeding in the brain.
Day subsequently was indicted on June 11, 2014, and charged in with assaulting an intimate partner by strangling and suffocating; attempted manslaughter; and endangering the lives and health of two children.
During today’s proceedings, Day pled guilty to Counts 1 and 2 of the indictment. In entering his plea agreement, Day admitted that on May 12, 2014, he assaulted the victim by placing his knee on her neck and placing his hand over her mouth causing her to suffocate. Day acknowledged that he attempted to kill the victim by impeding the victim’s breathing to the point of her losing consciousness.
At sentencing Day faces a statutory maximum penalty of ten years in federal prison on the assault by strangulation charge and seven years in prison on the attempted manslaughter charge. Day remains detained pending a sentencing hearing which has yet to be scheduled.
This case was investigated by the Albuquerque office of the FBI, the Laguna/Acoma Agency of the BIA’s Office of Justice Services, and the Pueblo of Laguna Tribal Police Department. Assistant U.S. Attorney David Adams is prosecuting this case.
The case was brought pursuant to the Tribal Special Assistant U.S. Attorney (Tribal SAUSA) Pilot Project in the District of New Mexico which is sponsored by the Justice Department’s Office on Violence Against Women under a grant administered by the Pueblo of Laguna. The Tribal SAUSA Pilot Project seeks to train tribal prosecutors in federal law, procedure and investigative techniques to increase the likelihood that every viable violent offense against Native women is prosecuted in either federal court or tribal court, or both. The Tribal SAUSA Pilot Project was largely driven by input gathered from annual tribal consultations on violence against women, and is another step in the Justice Department's on-going efforts to increase engagement, coordination and action on public safety in tribal communities.
Knoxville Woman and Others Indicted for Operating “Pill Mills" in Knox and Adjacent CountiesRead the Press Release
KNOXVILLE, Tenn. - A federal grand jury in Knoxville has returned indictments charging multiple individuals for their roles in the proliferation of several “pill mills” in Knox and adjacent counties over the past few years. The primary defendant in the investigation, Sylvia Hoffstetter, 51, of Knoxville, is charged with conspiring with other pain clinic operators or sponsors of pill shopping organizations to distribute oxycodone, and to launder the proceeds generated by those clinics.
Hoffstetter, who was arraigned on Mar. 10, 2015, before U. S. Magistrate Judge C. Clifford Shirley, Jr., is accused of being responsible for the distribution of a quantity of oxycodone sufficient to generate clinic revenue of at least $17.5M between April 2011 and March 2015. She was ordered to be jailed upon the government’s motion until a detention hearing is conducted on Friday, Mar. 13, 2015. Several others were arrested on Tuesday and made their initial appearances before the court. Other arrests are pending.
If convicted as charged, each defendant faces up to 20 years in prison and a fine of up to $1M on the drug trafficking charge and up to another 20 years and a fine of up to $500,000 on the money laundering charges. There is no parole in the federal system.
U.S. Attorney William C. Killian and FBI Special Agent in Charge (SAC) Edward Reinhold announced that this indictment is the result of an investigation by the FBI High Intensity Drug Trafficking Area (HIDTA). The FBI HIDTA is composed of FBI special agents and investigators assigned to the task force by Blount County Sheriff James Berrong, Clinton Police Chief Rick Scarborough, Harriman Police Chief Randy Heidle, Knox County Sheriff Jimmy “J. J.” Jones, Knoxville Police Chief David Rausch, Loudon County Sheriff Tim Guider, and Roane County Sheriff Jack Stockton. SAC Reinhold also expressed his appreciation to Jefferson County Sheriff Bud McCoig and Kingston Police Chief Jim Washam for providing assistance in the arrests of some of these defendants.
Assistant U.S. Attorneys Tracy L. Stone and Anne-Marie Svolto will represent the United States in the prosecution of these cases.
Members of the public are reminded that an indictment constitutes only charges and that every person is presumed innocent until his or her guilt has been proven beyond a reasonable doubt.
The HIDTA program enhances and coordinates drug control efforts among local, state, and federal law enforcement agencies. The program provides agencies with coordination, equipment, technology, and additional resources to combat drug trafficking and its harmful consequences in critical regions of the United States. In the Eastern District of Tennessee, HIDTA funds DEA and FBI led drug task forces in Johnson City, Knoxville, and Chattanooga, as well other initiatives to reduce drug crime in the HIDTA. For more information please visit www.whitehouse.gov/ondcp/high-intensity-drug-trafficking-areas-program .
The investigation is also part of the Department of Justice’s Organized Crime and Drug Enforcement Task Force (“OCDETF”) program, the centerpiece of the Department of Justice’s drug supply reduction strategy. OCDETF was established in 1982 to conduct comprehensive, multi-level attacks on major drug trafficking and money laundering organizations. Today, OCDETF combines the resources and expertise of its member federal agencies in cooperation with state and local law enforcement. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking and money laundering organizations and those primarily responsible for the nation’s drug supply.
Joint Statement from the Justice Department and the Office of the Director of National Intelligence on the Declassification of Renewal of Collection Under Section 501 of the Foreign Intelligence Surveillance ActRead the Press Release
On Feb. 27, 2015, the Director of National Intelligence declassified and disclosed publicly that the U.S. government had filed an application with the Foreign Intelligence Surveillance Court seeking renewal of the authority to collect telephony metadata in bulk, and that the FISC renewed that authority.
The FISC's Feb. 26, 2015, Primary Order renewing the collection expires on June 1, 2015. The DNI also announced that the Administration was undertaking a declassification review of the Feb. 26, 2015, Primary Order. Following this review by the Executive Branch, the ODNI has released in redacted form the Feb. 26, 2015, Primary Order, signed by Judge James E. Boasberg.
This order is now publicly available at the ODNI website, dni.gov, and the ODNI's public website dedicated to fostering greater public visibility into the intelligence activities of the Government, www.icontherecord.tumblr.com.
Primary Order Renewing Collection
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 Johnston in Great Falls on March 10, 2015, and entering pleas of Not Guilty were:
- WYATT CAMERON MONTCLAIR, a 20-year-old resident of Poplar, appeared on charges of involuntary manslaughter. If convicted of the charge contained in the indictment, MONTCLAIR faces 8 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the Federal Bureau of Investigation and the Fort Peck Tribes Department of Law and Justice. PACER Case Reference: 15-21
- BRANDON LEE ROMERO, a 20-year-old resident of Poplar, appeared on charges of burglary and assault resulting in serious bodily injury. If convicted of the most serious charge contained in the indictment, ROMERO faces 20 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the Fort Peck Tribes Department of Law and Justice. PACER Case Reference: 15-19
- JENNIFER RAE SALAZAR, a 28-year-old resident of Washington, 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, SALAZAR 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: 14-39
Appearing before U.S. Magistrate Judge Ostby in Billings on March 9, 2015, and entering pleas of Not Guilty were:
- DANNY LEWIS FROST, a 61-year-old resident of Billings, 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, FROST faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by the Drug Enforcement Administration and the Montana Division of Criminal Investigation. PACER Case Reference: 15-18
- PATRICK CLEARY HECK, a 54-year-old resident of Sidney, appeared on charges of failure to register as a sexual offender. If convicted of the charge contained in the indictment, HECK faces 10 years in prison, $250,000 in fines and lifetime supervised release. The case was investigated by the United States Marshals Service. PACER Case Reference: 15-18
Appearing before U.S. Magistrate Judge Lynch in Missoula on March 5, 2015, and entering pleas of Not Guilty were:
- SPENCER ROBERT RICE, a 28-year-old resident of Belgrade, appeared on charges of receipt of child pornography. If convicted of the most serious charge contained in the indictment, RICE faces 20 years in prison, $250,000 in fines and lifetime supervised release. The case was investigated by the Internet Crimes Against Children Task Force and the Bozeman Police Department. PACER Case Reference: 15-15
Appearing before U.S. Magistrate Judge Johnston in Great Falls on March 5, 2015, and entering pleas of Not Guilty were:
- MELISSA ANN BOUTWELL, a 31-year-old resident of Great Falls, appeared on charges of false statement in connection with purchase of a firearm and false declaration before grand jury. If convicted of the most serious charge contained in the indictment, BOUTWELL faces 10 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the United States Marshals Service. PACER Case Reference: 15-18
Appearing before U.S. Magistrate Judge Johnston in Great Falls on March 3, 2015, and entering pleas of Not Guilty were:
- DONELLE PARKER, a 43-year-old resident of Wolf Point, appeared on charges of robbery. If convicted of the charge contained in the indictment, PARKER faces 20 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by Fort Peck Tribes Department of Law and Justice. PACER Case Reference: 15-02
- OLYN PAYNE, a 35-year-old resident of Wolf Point, appeared on charges of robbery. If convicted of the charge contained in the indictment, PAYNE faces 20 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by Fort Peck Tribes Department of Law and Justice. PACER Case Reference: 15-02
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.
Indictment: Three Defendants Kidnapped and Killed Junction WomanRead the Press Release
TOPEKA, KAN. – Three people were indicted Wednesday on federal charges of kidnapping and killing a Junction City woman, U.S. Attorney Barry Grissom said. Grissom said his office is prosecuting the case jointly with the Geary County Attorney in federal court.
The body of Amanda Clemons, 24, of Junction City, was found in February 2014 in Geary County, Kan.
Charged with one count of kidnapping resulting in death are:
Larry L. Anderson, 26, who is being held in the Geary County Jail.
Marryssa M. Middleton, 23, who is being held in the Geary County Jail.
Drexel A. Woody, 24, who is being held in the Geary County Jail.
The indictment alleges that on Feb. 7, 2014, the defendants kidnapped the victim and held her on the Fort Riley military installation. While they were holding her they killed her.
If convicted, they face a maximum penalty of life in federal prison without parole. The Junction City Police Department, the Grandview Plaza Police Department, the Geary County Sheriff’s Office, the Riley County Police Department, the Fort Riley Criminal Investigation Division and the FBI investigated. Assistant U.S. Attorney Jared Maag, Assistant U.S. Attorney Tony Mattivi and Geary County Attorney Steven Opat are prosecuting.
OTHER INDICTMENTS
Frederick L. Sanders, 43, Topeka, Kan., is charged with one count of unlawful possession of a firearm following a felony conviction. The crime is alleged to have occurred Jan. 30, 2015, in Shawnee County, Kan.
If convicted, he faces a maximum penalty of 10 years in federal prison and a fine up to $250,000. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Tony Mattivi is prosecuting.
Luis Guadalupe Leon-Aceves, 44, Cavroca, Mexico, is charged with one count of possession with intent to distribute methamphetamine. The crime is alleged to have occurred March 8, 2015, in Sedgwick County, Kan.
If convicted, he faces a penalty of not less than 10 years in federal prison and a fine up to $10 million. The Drug Enforcement Administration investigated. Special Assistant U.S. Attorney Michelle Jacobs is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
Honduran Man Charged with Illegal ReentryRead the Press Release
A federal grand jury returned an indictment charging Selvis Velazquez-Villanueva, a 28 year-old Honduran citizen, for entering the United States illegally after previously being deported.
Velazquez-Villanueva, who entered the United States through Mexico after being deported in 2007, was found in Lorain, Ohio, during a traffic stop, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment alleges that Velazquez-Villanueva had unlawfully reentered the United States after being previously deported on May 16, 2007.
Assistant United States Attorney Karrie D. Howard is prosecuting the case, following an investigation by the United States Border Patrol, Department of Homeland Security.
If convicted, the Court will determine the defendant’s sentence after a review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum. In most cases, it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.
Gretna Man Pleads Guilty to Conspiracy to Commit Bank FraudRead the Press Release
U.S. Attorney Kenneth A. Polite announced that DAVID DELANEY, age 57, of Gretna, pled guilty today to conspiracy to commit bank fraud.
According to court documents, DELANEY, who worked as a technician for A & H Armature Works, Inc., embezzled from the company’s bank account at First American Bank. DELANEY conspired with another to steal from A & H Armature Works, Inc. by using PayPal and American Express accounts to transfer the funds.
DELANEY faces a maximum term of imprisonment of five years, a fine of $250,000 and three years of supervised release following any term of imprisonment. U.S. District Judge Helen G. Berrigan set sentencing for June 17, 2015.
U.S. Attorney Polite praised the work of the United States Secret Service, New Orleans Field Division in investigating this matter. Assistant United States Attorney Loan "Mimi" Nguyen is in charge of the prosecution.
Glenview Real Estate Broker Sentenced to 40 Months in Federal Prison for $4.2 Million Investor FraudRead the Press Release
CHICAGO — A former managing director of Panorama Global Partners, LLC, a company that falsely purported to trade in certain financial instruments, was sentenced today to 40 months in federal prison for fraudulently obtaining approximately $4.2 million in investor funds and for misappropriating approximately $3.9 million of those funds.
The defendant, RICHARD DEMARIA, 45, of Glenview, was also ordered to pay $3.9 million in restitution by U.S. District Judge Robert W. Gettleman. DeMaria, who pleaded guilty in December 2013, was ordered to surrender to begin serving his sentence on May 19.
Before imposing the sentence, Judge Gettleman stated that the sentence he imposed sent a message that “there will be a price to pay for” investor fraud.
DeMaria admitted that between approximately August 2008 and January 2009, he and a business associate fraudulently obtained approximately $4.2 million from victim investors, by falsely telling victim investors that their money would be used to lease and trade certain financial instruments DeMaria did not plan to, and did not use most of the investor money for the promised purpose, but rather misappropriated the money. In addition, as DeMaria soon learned, neither he nor his business associate had the ability to lease or trade these instruments. DeMaria used at least $3.9 million of investor money for other purposes, including $90,000 on an Aston Martin for a business associate and $600,000 on an Indiana home for another business associate. DeMaria also used approximately $70,000 of investor funds for construction on his ex-wife’s Evanston home and almost $2 million on business expenses related to DeMaria’s struggling real estate development business.
DeMaria entered into so-called “Subscription Agreements” with victim investors, on behalf of Panorama Global Partners, LLC, in which he promised to use their funds to purchase financial instruments. When victim investors asked for a return of their investment, DeMaria lied to them, saying that he had invested the money, when in fact he had misappropriated it.
The sentence was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois, and Robert J. Holley, Special Agent-in-Charge of the Federal Bureau of Investigation in Chicago. The government was assisted by the Securities and Exchange Commission.
The government was represented by Assistant United States Attorney Shoshana Gillers.
Ghent, NY Man Pleads Guilty to Money Laundering ConspiracyRead the Press Release
ALBANY, NEW YORK – Michael Elcox, 43, of Ghent, New York, entered a plea of guilty today to conspiracy to launder money before United States District Judge Thomas J. McAvoy, announced United States Attorney Richard S. Hartunian and James J. Hunt, Special Agent in Charge of the Drug Enforcement Administration (DEA), New York Division.
Elcox admitted that he was involved in the illegal distribution of marijuana and conspired to launder the proceeds of that illegal marijuana distribution by routing money through bank accounts held by a co-conspirator and moving cash from New York to Florida. Federal agents seized more than $300,000 in cash, representing proceeds of Elcox’s illegal marijuana distribution, from locations in New York and Florida.
Sentencing is scheduled for July 13, 2015 in Albany. Elcox faces a maximum sentence of up to twenty years in prison, a fine of up to $500,000, and three years of supervised release following his release from prison.
The case was investigated by Special Agents of the DEA Albany District Office, New York Division, DEA Gainesville Resident Office, Miami Field Division and Internal Revenue Service–Criminal Investigations, New York Field Office, as well as the Columbia County Sherriff’s Department, as part of the DEA’s High Intensity Drug Trafficking Area Program. The case is being prosecuted by Assistant United States Attorney Wayne A. Myers.
Gaithersburg Man Sentenced to over 4 Years in Prison in Bank Fraud SchemeRead the Press Release
Baltimore, Maryland – U.S. District Judge William D. Quarles, Jr. sentenced Phong Dinh Tran, a/k/a Randy Tran, age 40, of Gaithersburg, Maryland, today to 51 months in prison followed by three years of supervised release for conspiring to commit bank fraud arising from a scheme to use a straw purchaser to buy a liquor store. Judge Quarles also ordered Tran to pay restitution of $950,000.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Small Business Administration Inspector General Peggy E. Gustafson; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; and Acting Postal Inspector in Charge David M. McGinnis of the U.S. Postal Inspection Service - Washington Division.
According to his plea agreement, Tran created R&K Real Estate Investment, Inc. to buy Potomac Wine & Spirits, a liquor store in Hagerstown, Maryland. Tran was the majority and controlling owner of R& K, and another individual owned a minority interest. In May 2006, Tran and the minority shareholder signed agreements to buy the liquor store for $899,000 and the real estate that the store occupied for $400,000.
Tran sought Joon Park, a principal of Jade Capital & Investments, to broker a loan for the store’s purchase. Tran and Park discussed obtaining a loan at PNC Bank that was guaranteed by the U.S. Small Business Administration (SBA). Because Tran had significant debt from the purchase of residential properties, Park advised that Tran would not likely be approved for an SBA guaranteed loan.
Tran disclosed to Park that he could use a straw buyer for the loan. Tran and Park agreed that they would falsely represent to PNC that the straw buyer would own and operate the liquor store. Tran asked the straw buyer to apply for the loan and promised that he, Tran, would pay all the bills for the store and make the loan payments. At the settlement for the sale of the liquor store on September 29, 2006, the straw purchaser falsely represented to PNC that he was the president of R&K. The funds needed to close the transaction were provided by Tran, not the straw purchaser. PNC funded a loan of $950,000.
After the closing, Tran ran the liquor store. On January 22, 2007 Tran sold a 50% stake in the store to another individual for $380,000. During the sale, Tran represented to the individual that he owned 100% of the store. In 2007, Tran stopped making loan payments to PNC and the loan went into default.
In a separate case, Joon Park, a/k/a “Joon Pak,” and “Joon Paik,” age 44, of Falls Church, Virginia, previously pleaded guilty to his role in a bank fraud conspiracy arising from a scheme to fraudulently obtain numerous business loans guaranteed by the SBA, with resulting losses of over $100 million. Park submitted false SBA loan applications on behalf of his clients from 2003 to 2011. Judge Quarles sentenced Park on June 20, 2013 to 15 years in prison and ordered Park to pay a money judgment of $91,449,700.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Since the inception of FFETF in November 2009, the Justice Department has filed more than 12,841 financial fraud cases against nearly 18,737 defendants including nearly 3,500 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
United States Attorney Rod J. Rosenstein commended the SBA-OIG, FBI and U.S. Postal Inspection Service for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Leo J. Wise and Sean Delaney, who prosecuted the case.
Franklin Man Sentenced to More Than 6 Years in Prison for Possessing Child PornographyRead the Press Release
LAFAYETTE, La. – United States Attorney Stephanie A. Finley announced today that a Franklin man was sentenced to 78 months in prison on charges that he downloaded and stored images of child pornography onto a hard drive.
Tommie Joseph Beason, 37, of Franklin, La., was sentenced by U.S. District Judge Richard T. Haik on one count of possession of child pornography. He was also sentenced to five years of supervised release. According to evidence presented at the October 27, 2014 guilty plea, law enforcement agents detected Beason downloading child pornography. Law enforcement agents then searched Beason’s residence on June 3, 2014, and found 230 images and 88 videos of hardcore child pornography on an external hard drive. The illegal files included prepubescent child pornography with very young children and sadistic material.
Homeland Security Investigations and the Louisiana State Police conducted the investigation. Assistant U.S. Attorney John Luke Walker prosecuted the case.
This case is part of Project Safe Childhood, a U.S. Department of Justice nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The U.S. Attorney’s Office and the U.S. Department of Homeland Security/Homeland Security Investigations/Immigration & Customs Enforcement (ICE) encourage the public to report suspected child predators and any suspicious activity through its toll-free hotline at (866) DHS-2ICE. Investigators are available at all hours to answer hotline calls. Tips or other information can also be submitted to ICE online at www.ice.gov/exec/forms/hsi-tips/tips.asp. Tips may be submitted anonymously.
Four Serra Nissan Employees Plead Guilty to Auto Loan Fraud ConspiracyRead the Press Release
BIRMINGHAM -- Four former Serra Nissan employees charged in connection with a conspiracy at the Birmingham car dealership to fraudulently boost loan approvals and car sales pleaded guilty today in federal court, announced U.S. Attorney Joyce White Vance, IRS Criminal Investigation Special Agent in Charge Veronica Hyman-Pillot and FBI Special Agent in Charge Roger C. Stanton.
D. SCOTT BURTON, 36, of Odenville, MICHAEL J. WILKINSON, 56, of Moody, TERRY W. HENDERSON, 39, of Pleasant Grove, and ROLAND W. RILEY, 28, of Birmingham, entered their pleas before U.S. District Judge Virginia Emerson Hopkins. All eight defendants charged in the conspiracy to defraud financial institutions, Nissan North America and Serra Nissan customers between August 2010 and October 2013 by fraudulently increasing vehicle sales in order to boost personal profits have now pleaded guilty.
DWIGHT A. PERRY, 44, of Birmingham, and ABDUL ISLAM MUGHAL, 48, of Trussville, pleaded guilty last year, and GERALD R. SHEPARD, 56, of Pinson, and JEFFREY R. GREEN, 33, of Porterdale, Ga., pleaded guilty earlier this year. The eight defendants are scheduled for sentencing between May and July.
"Predatory practices in providing auto loans to people with credit problems or insufficient income is akin to the fraud in mortgage lending," Vance said. "We are engaged in rooting out this fraudulent activity that threatens consumer safety."
Mughal, Shepard, and Burton were sales managers at Serra Nissan, Green and Wilkinson were finance managers, and Perry, Henderson and Riley were salesmen. All eight have pleaded guilty to the conspiracy. In addition, Mughal also pleaded guilty to bank fraud, Shepard to bank fraud and filing a false federal income tax return, and Green to failure to file an individual tax return.
According to court records, the Serra Nissan employees involved in the conspiracy used various means to carry out their fraud and obtain auto loans that, otherwise, would not have been approved. Those means included the following:
• Creating or altering documents to submit to financial institutions to show inflated income for prospective buyers.
• Directing finance managers and salesmen to submit fraudulent documents to financial institutions to misrepresent proof of a customer's residency.
• Listing accessories not actually included on a vehicle so a financial institution would increase its loan amount. The defendants and others had a financial incentive to increase a loan amount in order to increase commissions paid to certain employees.
• Presenting straw buyers, who could qualify for a loan, to financial institutions when the actual buyer could not qualify.The maximum penalty for the conspiracy count is five years in prison and a $250,000 fine. The maximum penalty for bank fraud is 30 years in prison and a $1 million fine. The minimum penalty for aggravated identity theft is two years in prison.
The IRS and the FBI investigated the case, which Assistant U.S. Attorneys Amanda S. Wick and Robin Beardsley Mark are prosecuting.
Four Charged with Trafficking Heroin and Heroin Laced with FentanylRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
BUFFALO, N.Y.—U.S. Attorney William J. Hochul, Jr. announced today that John Haak, 33, of Evans, NY, and Francis Tessina, 43, of Buffalo, NY, were arrested and charged by criminal complaint with distribution of heroin and conspiracy to distribute heroin. The charges carry a maximum penalty of 20 years in prison.
Assistant U.S. Attorney Frank T. Pimentel, who is handling the case, stated that according to the complaint, on February 28, 2015, law enforcement officers investigated the apparent heroin overdose of a man in Hamburg, NY. During the investigation, officers discovered a cellular telephone that belonged to the deceased individual. Text messages exchanged between the man and defendant Haak revealed that the man had received heroin from Haak shortly before his body was discovered.
Further investigation revealed that Haak delivered bags of heroin, purchased from defendant Tessina, to the deceased man late in the afternoon of February 28, 2015. The defendant also sent text messages to the man warning him to be careful with the heroin because Haak believed it contained fentanyl. The complaint also charges tessina alone of selling heroin on March 9, 2015.
The defendants made an initial appearance this morning before U.S. Magistrate Judge Jeremiah J. McCarthy. Defendant Haak was released on conditions and is due back in court on March 20, 2015 at 11:30 a.m. Defendant Tessina is being held pending a detention hearing on March 16, 2015 at 11:30 a.m.
The criminal complaint is the culmination of an investigation on the part of the Drug Enforcement Administration, under the direction of Special Agent in Charge James J. Hunt, New York Field Division, the Hamburg Police Department, under the direction of Chief Michael Williams, and the Evan Police Department, under the direction of Chief Ernest Masullo.
In a separate case, a federal grand jury has indicted Trent Adair Hamilton, 33, of Lockport, NY, and Michael Paul Mitchell, 33, of Niagara Falls, NY, on a charge of conspiracy to possess with intent to distribute and to distribute heroin. Hamilton is also charged with possession with intent to distribute and to distribute heroin. Mitchell is facing an additional charge of possession with intent to distribute and to distribute crack cocaine. The charges carry a mandatory minimum sentence of five years in prison, a maximum of 40 years, and a $5,000,000 fine.
Hamilton and Mitchell were arraigned on March 10, 2015 before U.S. Magistrate Judge Jeremiah J. McCarthy. The defendants are being held pending a detention hearing on March 13, 2015 at 11:00 a.m.
The indictment is the result of an investigation on the part of the Niagara County Sheriff’s Department, under the direction of Sheriff James Voutour, the Lockport Police Department, under the direction of Chief Larry Eggert, the Niagara Falls Police Department, under the direction of Chief Bryan DalPorto, the North Tonawanda Police Department, under the direction Chief Randy Szukala, the New York State Police, under the direction of Major Michael Cerretto, and the New York State Attorney General’s Office, under the direction of Eric Schneiderman.
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.
Former U.S. Air Force Captain Pleads Guilty to Violating Conflict of Interest Laws and Making a False StatementRead the Press Release
A former Captain in the U.S. Air Force (USAF) who served in 2010 as a U.S. military contracting officer in Afghanistan, pleaded guilty yesterday to violating restrictions on post-government employment and making a false statement to law enforcement agents, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Kevin W. Techau of the Northern District of Iowa.
Adam J.J. Pudenz, 35, of Carroll, Iowa, pleaded guilty to willfully violating federal conflict-of-interest laws stemming from his post-government employment with an Afghan company that contracted with the U.S. military and to making a false statement to federal law enforcement agents. The guilty plea was entered before U.S. Magistrate Judge Leonard T. Strand of the Northern District of Iowa. In addition to his guilty plea, Pudenz agreed in a separate civil action to surrender his Iowa residence, which he purchased with money received from his unlawful employment, to the United States.
According to his plea agreement, Pudenz served as a contracting official at Camp Eggers, near Kabul, Afghanistan, in 2010. In that capacity, Pudenz admitted that he administered at least three major U.S. government contracts, all held by the same Afghan company, for the purchase of clothing and footwear for Afghan National Security Forces (ANSF).
Pudenz admitted that prior to departing Afghanistan in December 2010, he began negotiating his future employment with the same Afghan company that held the contracts he administered, a fact that he later lied about during a subsequent law enforcement investigation. In his new position with the Afghan company, Pudenz admitted that he violated the conflict of interest laws by returning to Afghanistan and lobbying U.S. government officials on matters directly related to the same contracts he had previously administered.
This case is being and investigated by the FBI, the Defense Criminal Investigative Service, the Special Inspector General for Afghanistan Reconstruction and U.S. Army Criminal Investigation Command (CID). The case is being prosecuted by Trial Attorney Wade Weems of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Richard L. Murphy of the Northern District of Iowa.
Former U.S. Air Force Captain Pleads Guilty to Violating Conflict of Interest Laws and Making a False StatementRead the Press Release
SIOUX CITY – A former Captain in the U.S. Air Force (USAF) who served in 2010 as a U.S. military contracting officer in Afghanistan, pleaded guilty yesterday to violating restrictions on post-government employment and making a false statement to law enforcement agents, announced U.S. Attorney Kevin W. Techau of the Northern District of Iowa and Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division.
Adam J.J. Pudenz, 35, of Carroll, Iowa, pleaded guilty to willfully violating federal conflict-of-interest laws stemming from his post-government employment with an Afghan company that contracted with the U.S. military and to making a false statement to federal law enforcement agents. The guilty plea was entered before U.S. Magistrate Judge Leonard T. Strand of the Northern District of Iowa. In addition to his guilty plea, Pudenz agreed in a separate civil action to surrender his Iowa residence, which he purchased with money received from his unlawful employment, to the United States.
According to his plea agreement, Pudenz served as a contracting official at Camp Eggers, near Kabul, Afghanistan, in 2010. In that capacity, Pudenz admitted that he administered at least three major U.S. government contracts, all held by the same Afghan company, for the purchase of clothing and footwear for Afghan National Security Forces (ANSF).
Pudenz admitted that prior to departing Afghanistan in December 2010, he began negotiating his future employment with the same Afghan company that held the contracts he administered, a fact that he later lied about during a subsequent law enforcement investigation. In his new position with the Afghan company, Pudenz admitted that he violated the conflict of interest laws by returning to Afghanistan and lobbying U.S. government officials on matters directly related to the same contracts he had previously administered.
This case is being and investigated by the FBI, the Defense Criminal Investigative Service, the Special Inspector General for Afghanistan Reconstruction, and U.S. Army Criminal Investigation Command (CID). The case is being prosecuted by Trial Attorney Wade Weems of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Richard L. Murphy of the Northern District of Iowa.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 15-3008.
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Former Programmer Pleads Guilty to Stealing Software Code from Federal Reserve BankRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a former software programmer for the Federal Reserve Bank of Kansas City pleaded guilty in federal court today to stealing software code.
Hamid Reza Tahmasebi, 54, of Leawood, Kan., waived his right to a grand jury and pleaded guilty before U.S. District Judge Beth Phillips to a federal information that charges him with theft of government property.
Tahmasebi worked as a lead programmer for the Federal Reserve from Oct. 16, 2012, to Feb. 7, 2014. Tahmasebi admitted that, during his last week of employment, he e-mailed sensitive information to his personal e-mail accounts. Tahmasebi also admitted that he uploaded large amounts of sensitive information to his private Google Drive on-line storage account.
Tahmasebi admitted that he uploaded software code he was working on for the Federal Reserve to his Google Drive account. This software code was developed by the Federal Reserve as part of its role as the fiscal agent for the U.S. Treasury Department. The code taken by Tahmasebi was proprietary and owned by the Treasury Department.
The Federal Reserve, following Tahmasebi’s theft, launched an incident response and investigation along with an extensive code review to ensure its security. Tahmasebi acknowledged in today’s plea agreement that he owes restitution to the Federal Reserve to compensate for the cost of those actions, which the government believes totaled $246,433.
Under the terms of today’s plea agreement, Tahmasebi must pay restitution to the Federal Reserve Bank and a sentence of five years of probation is jointly recommended. A sentencing hearing is scheduled for July 2015.
This case is being prosecuted by Assistant U.S. Attorney Matthew P. Wolesky. It was investigated by the FBI.
Former Private School Coach Facing Indictment Returned to U.S. for ArraignmentRead the Press Release
The former cross country ski coach at a Seattle private school was returned to the U.S. today to appear for arraignment on his indictment on five child pornography related offenses, announced Acting U.S. Attorney Annette L. Hayes. JASON CHRISTOPHER PAUR, 44, of Seattle was arrested by the Royal Canadian Mounted Police in December 2013 at Silver Star ski area in British Columbia, Canada. The arrest came after female students on a school sponsored field trip discovered a video camera had been hidden in their bedroom. The camera had been positioned to video-tape the students while they got dressed after showering. PAUR was immediately removed from the field trip by the chaperones who notified police. PAUR was fired by the school, which has fully cooperated with law enforcement. PAUR is charged with two counts of Production and Transportation of Child Pornography, Production of Child Pornography with Intent to Transport, Possession of Child Pornography and Transportation of Minors with Intent to Engage in Criminal Sexual Activity. PAUR was turned over to U.S. authorities today and will make his initial appearance in U.S. District Court in Seattle tomorrow at 2:00.
According to records in the case and the indictment, the investigation revealed that PAUR had also secretly recorded students while on the annual field trip in 2011 and 2012. The camera seized in Canada contained images, taken in 2013, of students between the ages of 14 and 17 being secretly filmed while changing clothes or after exiting the shower. The indictment alleges PAUR used the pictures for his own sexual gratification, and transported the pictures from Canada to the U.S. The indictment further alleges that PAUR traveled with the juveniles to Canada with the intent to film them for his own sexual gratification.
The charges contained in the indictment are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
The case is being investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI). The case is being prosecuted by Assistant United States Attorney Kate Vaughan.
Former Owner and Employees of Brentwood Based Melanocorp, Inc. Plead Guilty to Federal ChargesRead the Press Release
Company Marketed and Sold Injectable Tanning Product Without FDA Approval
Edward Manookian, 63, of Hendersonville, Tenn., and former owner and President of Melanacorp, Inc., pleaded guilty today to one count of conspiring to defraud the U.S. Food and Drug Administration (“FDA”) and to one count of conspiring to smuggle goods from the United States in violation of the Food, Drug, and Cosmetic Act (“FDCA”), announced David Rivera, United States Attorney for the Middle District of Tennessee.
“The consuming public relies heavily on the FDA’s authority to require products to be properly manufactured, labeled and rendered safe for use,” said U.S. Attorney David Rivera. “The defendants in this case blatantly disregarded the FDA’s orders and direction and placed their desire for ill-gotten profits above the safety of the public. The U.S. Attorney’s Office will continue to work with our regulatory partners to ensure the safety of our citizens and to bring those to justice who circumvent the safety of the public for profit.”
In a plea hearing before U.S. District Judge Todd J. Campbell, Manookian admitted that Melanocorp sold Melanotan II (“MII”), a drug that had not been approved by the FDA. Melanocorp marketed and advertised MII as an injectable tanning product and claimed that MII could reduce skin cancer rates. In August 2007 the FDA warned Melanocorp that MII could not be distributed without FDA approval, however, despite the FDA warning and at Manookian’s direction, Melanocorp continued to sell MII both domestically and abroad until April 2009. Following receipt of the FDA warning letter, Melanocorp sold more than $929,000 worth of MII.Manookian also admitted that Melanocorp advertised its MII as being manufactured in the United States, despite the fact that Melanocorp sold MII that had been imported from China. Manookian also admitted that Melanocorp employees routinely mislabeled the contents of packages containing MII in an effort to avoid detection by U.S.Customs officials.
"When individuals, like the defendants in this case, defraud consumers by disguising the true nature of their products, they not only circumvent FDA’s regulatory authority, they also place consumers’ health in jeopardy," said George M. Karavetsos, Director, FDA Office of Criminal Investigations.“By willfully mislabeling products and knowingly selling unapproved drugs the defendants placed illegal profit over the health and safety of law-abiding citizens,” said Acting Special Agent in Charge of HSI New Orleans Cindy M. Johnson. “Counterfeit drugs and cosmetics are a particular danger to the public because of the potential to ingest harmful substances, and HSI will continue to work with its federal, state and local law enforcement partners to keep these potentially dangerous items off the street.” Johnson oversees a five-state area of responsibility including Tennessee, Arkansas, Alabama, Louisiana and Mississippi.
Manookian is scheduled to be sentenced by Judge Campbell on June 26, 2015. He faces up to five years in prison and a fine of up to $250,000 on each count.
In addition, two other former employees of Melanocorp pleaded guilty today in a hearing before Judge Campbell. Brian Manookian, 34, of Nashville, and Karen Manookian, 31, of New York City, each pleaded guilty to one count of violating the FDCA by distributing MII in interstate commerce. Brian and Karen Manookian are scheduled to be sentenced by Judge Campbell on June 19, 2015. Each faces up to one year in prison.
This case was investigated by the FDA- Office of Criminal Investigations and the Department of Homeland Security, Homeland Security Investigations. The case is being prosecuted by Assistant U.S. Attorney William F. Abely.
Former Oklahoma Jail Superintendent and Assistant Superintendent Sentenced for Excessive Force Against InmatesRead the Press Release
Raymond A. Barnes, 44, and Christopher A. Brown, 33, the former jail superintendent and assistant jail superintendent, respectively, of the Muskogee County Jail (MCJ) were sentenced in federal court today on multiple counts of civil rights offenses related to allegations of excessive force on inmates at MCJ on or between August 2009 and May 2011. Brown was also convicted of making material false statements to the FBI. Barnes was sentenced to one year and one day imprisonment followed by two years supervised release, and Brown was sentenced to six months imprisonment followed by three years supervised release.
On Feb. 25, 2014, a federal jury convicted both Barnes and Brown of conspiring to violate the rights of inmates housed at MCJ by assaulting inmates themselves or by directing other jailers employed by MCJ to do so. Specifically, the defendants did or caused the following to be done: unjustifiably strike, assault, harm and physically punish inmates at MCJ who were restrained, compliant and not posing a physical threat; organize “meet and greets,” whereby jailers would scare, punish and harm incoming inmates from neighboring counties by throwing and slamming the handcuffed inmates to the ground upon their arrival at MCJ; threaten to fire MCJ employees if they reported abusive behavior directly to the sheriff or to outside law enforcement authorities; require and encourage MCJ jailers to write incident reports that falsely justified uses of force and contained misleading or inaccurate accounts of what had occurred when force was used; and perpetuate an environment within MCJ that allowed unlawful beatings and assaults against inmates to continue indefinitely and without consequence.
Both defendants were also found guilty of violating the rights of an inmate identified as J.R. when both defendants slammed and threw J.R. head-first to the ground while he was handcuffed. Barnes was additionally convicted of violating the rights of a second inmate, G.T., for similar conduct. Brown was acquitted of violating the rights of G.T.
In addition, Brown was convicted of one count of making material false statements to the FBI. Brown falsely claimed that, during meet and greets, the incoming inmate was ordered out of the transport vehicle and then “gently placed” on the ground. But in fact, Brown knew at the time of his statement to the FBI that during these meet and greets the MCJ jailers routinely threw and slammed inmates to the ground even though the inmates were restrained and posed no physical threat.
“The Department of Justice will not hesitate to prosecute corrections officers who violate their oath and abuse those who are entrusted to their custody,” said Acting Assistant Attorney General Vanita Gupta of the Civil Rights Division. “The convictions and sentences in this case make clear that the department will vigorously enforce the civil rights laws.”
This case was investigated by the Muskogee Resident Agency of the Oklahoma City Division of the FBI and prosecuted by Trial Attorneys Fara Gold and Dana Mulhauser of the Civil Rights Division.
Former Minneapolis School Cook Sentenced to 30 Months in Prison for Acting as Straw Purchaser for Convicted FelonRead the Press Release
Angela Carter Purchased Two Handguns and Knowingly Lied on ATF FormsUnited States Attorney Andrew M. Luger today announced the sentencing of ANGELA CARTER, 33, to 30 months in federal prison for acting as a straw purchaser of two handguns. CARTER was indicted on May 12, 2014, and pleaded guilty on July 28, 2014, to one count of Causing a False Statement to be Maintained in the Records of a Federal Firearms Licensee. The defendant was sentenced on March 10, 2015, before Judge John R. Tunheim in U.S. District Court in Minneapolis, Minn.
According to the defendant’s guilty plea, documents filed in court and statements made on the record in court, on January 21, 2014, Carter bought a Ruger 9mm semi-automatic pistol for $355 from Bill’s Gun Shop in Robbinsdale, Minn. On February 7, 2014, Carter again went to Bill’s Gun Shop and bought a Glock .40 caliber semi-automatic pistol, a 15 round magazine, and 2 boxes of ammunition for $740. When purchasing both handguns, Carter listed an incorrect address on the Bureau of Alcohol, Tobacco, Firearms, and Explosives Form 4473. Carter had moved from that address several months earlier.
According to the defendant’s guilty plea, documents filed in court and statements made on the record in court, both guns, which were fully loaded, were seized on February 10, 2014, during a traffic stop of Carter’s car. At the time, police also seized a Glock 9mm semi-automatic pistol with a fully loaded 33 road magazine. Carter purchased both guns to give to a co-defendant, Keniko Bland, who was prohibited by law from possessing firearms because he had pending charges in Hennepin County for Terroristic Threats. Bland was previously sentenced on December 18, 2014, to 57 months in custody.
This case is the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Minneapolis Police Department.
This case was prosecuted by Assistant U.S. Attorney Carol Kayser.
Defendant Information:
ANGELA CARTER, 33
Minneapolis, Minn.
Convicted:
• Causing a False Statement to be Maintained in the Records of a Federal Firearms Licensee, 1 count
Sentenced:
• 30 months in prison
• 3 years supervised releaseFederal Judge Sentences Last of Four Crystal Methamphetamine Traffickers to PrisonRead the Press Release
ASHEVILLE, N.C. – On Tuesday, March 10, 2015, U.S. District Judge Martin Reidinger sentenced Joshua Warner Kamp to 33 months in prison for his role in a crystal methamphetamine trafficking ring, announced Jill Westmoreland Rose, Acting U.S. Attorney for the Western District of North Carolina. Kamp, 35, of Alexander, N.C. was also sentenced to four years of supervised release following his prison term. Kamp pleaded guilty in January 2015 to conspiracy to distribute and to possess with intent to distribute methamphetamine.
Kamp’s three codefendants were previously sentenced as follows: Mario Oliver Perez-Sanchez, 30, of Atlanta, Ga. was sentenced to 151 months in prison; Gerardo Moteil Diaz, 29, of Leicester, N.C. was sentenced to 87 months; and Debbie Ollis Webb, 58, of Leicester, N.C. was sentenced to 57 months in prison. They each pleaded guilty to one count of conspiracy to distribute and to possess with intent to distribute methamphetamine and were also ordered to five years of supervised release following their release from prison.
Wayne L. Dixie, Special Agent in Charge of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Charlotte Field Division; Sheriff Van Duncan of the Buncombe County Sheriff’s Office (BCSO); and Lt. John Elkins of the Buncombe County Anti-Crime Task Force (BCAT) join Acting U.S. Attorney Rose in making today’s announcement.
According to court documents and court proceedings, from in or about April 2013 through October 2013, Perez acted as an Atlanta, Ga. based methamphetamine source of supply, moving large quantities of methamphetamine between Georgia, South Carolina and North Carolina. Court records show that Diaz assisted Perez in his North Carolina narcotics trafficking. According to court records, Kamp and Webb bought the methamphetamine from Perez and Diaz, and then sold it in Buncombe County and elsewhere. Over the course of the investigation, law enforcement seized approximately 21 ounces of methamphetamine, $10,876 in U.S. currency and one firearm.
Kamp will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
ATF, BCSO and BCAT investigated the case. The prosecutions were handled by Assistant U.S. Attorney Thomas Kent of the U.S. Attorney’s Office in Asheville.
Federal Government Seizing Drug Properties in Rutland, VtRead the Press Release
The United States Attorney’s Office announced today that it had filed a forfeiture lawsuit against the real property at 24 and 24.5 Cottage Street in Rutland Vermont. The suit was brought pursuant to 21 U.S.C. § 881(a)(7), which provides that property which is used to commit or to facilitate the commission of felony drug offenses can be forfeited to the Government.
The property contains two buildings which are used as a single room occupancy hotel. Tenants each have use of a private room, but all bathrooms and kitchen spaces are shared among all tenants. Between them the two buildings have seventeen rooms plus a private apartment, which was occupied by Michael Petruccelli, the son of the owners, and his wife, Stacia Petruccelli.
The complaint and the accompanying affidavit of FBI agent Christopher Destito show that Michael Petruccelli was a crack cocaine addict who allowed drug dealers to stay at the property to sell drugs so long as they paid him in crack cocaine. The documents show Petruccelli also sold cocaine himself and helped some of the dealers sell their drugs, which included both heroin and crack cocaine. The documents also show that Michael Petruccelli went so far as to phone a dealer staying at the property to warn him that the police had entered the building and were heading for his room. The documents also show that law enforcement made seven buys of illegal narcotics at the property, including two buys of crack cocaine from Michael Petruccelli, and that he used a safe in the basement to store narcotics and assisted larger scale dealers to bag and sell their drugs.
The court documents show that the property is owned by a New York corporation owned by Francesca and Rudolph Petruccelli, parents of Michael Petruccelli. The owners have put the property in the control of Michael Petruccelli. The documents state that Mr. and Mrs. Petruccelli were informed by law enforcement of the drug dealing at the property, that they asked for assistance in stopping the illegal trade but that when they were informed that their son was dealing drugs there, they refused to take control of the property back from him. Michael Petruccelli was charged by federal indictment on February 4, 2015, with crack cocaine distribution. He is currently detained pending further proceedings in his criminal case.
The forfeiture proceedings against the Cottage Street properties and the criminal case against Michael Petruccelli are part of an on-going effort by the U.S. Attorney’s Office in conjunction with federal, state and local law enforcement agencies to address drug activity in Rutland. During the past year, the U.S. Attorney’s Office has charged approximately thirty individuals federally who have facilitated the drug trade in Rutland, Vermont.
The charged individuals have included out-of-state dealers responsible for bringing significant quantities of heroin and crack cocaine to Rutland; local residents who provided housing, transportation, and local distribution networks to these out-of-state dealers; and couriers who moved the drugs between other states (most frequently New York) and Vermont.
The United States Attorney’s Office stated that Troy Gibbs, 52, of Rutland, pled guilty on March 10, 2015 under the federal “crack-house statute,” 21 U.S.C. § 856(a)(2), which makes it a crime, subject to 20 years imprisonment, to knowingly allow drug dealers to stay at a residence to store, use or distribute their drugs. According to documents released in the case, Gibbs allowed out-of-state dealers to stay at his residence on Summer Street in Rutland in exchange for crack cocaine. Gibbs will be sentenced by Chief United States District Court Judge Christina Reiss on June 23, 2015.
The United States Attorney’s Office’s efforts to combat drug trafficking in Rutland have been supported by the work of the Vermont State Police Drug Task Force, the Drug Enforcement Agency, and the Federal Bureau of Investigation, and the Rutland Police Department. The United States Marshals Service will play a key role in the forfeiture of the Cottage Street properties. The criminal cases are being handled by AUSA Joe Perella. AUSA James Gelber is responsible for the property forfeitures.
Troy Gibbs is represented by Brooks McArthur, Esq. Michael Petruccelli is represented by Thomas Sherrer, Esq.
Fayette County Man Admits Threating the President, His FamilyRead the Press Release
PITTSBURGH -- A resident of the Uniontown, Pa., area, pleaded guilty in federal court to charges of threats against the President and the members of the immediate family of the President, United States Attorney David J. Hickton announced today.
Joseph H. Savage, 34, currently incarcerated for state convictions, pleaded guilty to two counts before Senior United States District Judge Maurice B. Cohill, Jr.
In connection with the guilty plea, the court was advised that on or about Oct. 26, 2012, while incarcerated and awaiting disposition on state charges, Savage wrote a graphic letter to the White House threatening to kill the President and the President’s family.
Judge Cohill scheduled sentencing for June 17, 2015 at 4 p.m. The law provides for a total sentence of 10 years in prison, a fine of $500,000.00, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Shardul S. Desai is prosecuting this case on behalf of the government.
The United States Secret Service conducted the investigation that led to the prosecution of Savage.
Ex-Marine Indicted in Sexual Assault of Another Marine on Camp PendletonRead the Press Release
SAN DIEGO – A former Marine is charged in an indictment unsealed today with sexually assaulting an active-duty Marine in November 2014 on Camp Pendleton.
Pedro Javier Orellana, 23, was indicted by a federal grand jury and surrendered himself for arrest in Laurel, Maryland on Wednesday. He made his first federal court appearance today in Greenbelt, Maryland. A detention hearing will be held on Thursday to determine if Orellana should be detained pending transfer back to San Diego.
According to the indictment, Orellana sexually assaulted his victim on the Marine base while she was “incapable of appraising the nature of the conduct or was physically incapable of declining participation in the sex act.”
DEFENDANT Case Number: 15CR0597 Pedro Javier Orellana Age: 23 Laurel, Maryland CHARGES18 U.S.C. § 2242(2) – Sexual Abuse- Incapacitated Victim (Maximum Life Sentence)
INVESTIGATING AGENCIESNaval Criminal Investigative Service
Marine Corps Criminal Investigation Division*The charges and allegations contained in an indictment are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Ex-Casino Owner, Nevada Businessman and Former NFL Player Sentenced to Prison in Massive Tax Fraud SchemeRead the Press Release
Court Orders More than $35 Million in Restitution
A former casino owner from Henderson, Nevada, a former businessman from Las Vegas and a former NFL punter from Upland, California, were sentenced yesterday in U.S. District Court in Las Vegas to serve prison time and ordered to pay more than $35 million in restitution for conspiracy and fraud related to their promotion of a fraudulent tax product through the now-defunct National Audit Defense Network (NADN), announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division.
Alan Rodrigues, NADN’s former general manager and executive vice president, was sentenced to serve 72 months in prison to be followed by three years of supervised release and to pay a $2,000 special assessment by U.S. District Court Judge Miranda Du of the District of Nevada. Rodrigues was ordered to pay restitution of more than $35 million to customers of NADN who purchased the fraudulent tax product. Weston Coolidge, a businessman who previously served as NADN’s president, was sentenced by Judge Du to serve 70 months in prison followed by three years of supervised release, and to pay a $2,000 special assessment for his part in the fraud. Coolidge was also ordered to pay restitution of more than $35 million to victims of the fraud. Joseph Prokop, who previously served as the National Marketing Director for Oryan Management and Financial Services, a company affiliated with NADN, was sentenced to serve 18 months in prison to be followed by 30 months home confinement and three years of supervised release. Prokop was also ordered to pay a $1,800 special assessment and restitution to victims of more than $35 million. At sentencing, Judge Du found that the defendants were responsible for fraud losses of more than $36 million and an intended tax loss of more than $60 million.
On May 27, 2014, after a six-week jury trial, the three defendants were convicted of one count of conspiracy to defraud the United States, 13 counts of aiding and assisting in the preparation of false income tax returns and four counts of mail fraud. Rodrigues and Coolidge were each convicted of an additional two counts of aiding and assisting in the preparation of false income tax returns.
“Business professionals who design, market and sell fraudulent tax products by criminally exploiting select provisions of the tax code will be prosecuted to the full extent of the law,” said Acting Assistant Attorney General Ciraolo. “The prison sentences handed down yesterday against the defendants demonstrate that the Department of Justice is committed to holding individuals responsible for their criminal conduct.”
The evidence at trial established that through NADN, the defendants promoted and sold a product called Tax Break 2000 to customers throughout the United States. NADN began to promote and sell Tax Break 2000 in early 2001. Tax Break 2000 purported to be an online shopping website. The defendants falsely and fraudulently told customers that buying the product would allow them to claim legitimate income tax credits and deductions under the Americans with Disabilities Act (ADA) by modifying the website each customer was provided to make it accessible to the disabled. NADN charged $10,475 for the product to maximize the fraudulent income tax credits and deductions that individuals would claim on their tax returns. Although the price of the product that was claimed on the tax returns was $10,475, the customers only paid between $2,000 and $2,695 out-of-pocket. The remainder of the cost was covered by a promissory note that customers were not expected to repay.
The defendants knew that the websites provided to customers made little, if any, money from sales commissions and that they did not entitle the purchaser to either a tax credit or any deductions. The defendants nonetheless taught and directed the tax return preparers working for NADN to prepare thousands of tax returns for customers that claimed the fraudulent tax credit and deductions. When special agents of the Internal Revenue Service (IRS) began to investigate Tax Break 2000 and NADN, the evidence showed that the defendants sought to cover up the fraud by creating false IRS Forms 1099 that reported fictitious income to make it appear that the websites were in fact earning money.
From 2001 through approximately May 2004, NADN sold the Tax Break 2000 product more than 18,000 times to thousands of customers located throughout the United States. As a result of the defendants’ fraud, thousands of NADN customers were audited by the IRS. On April 13, 2004, the Tax Division filed a civil complaint seeking to enjoin, among others, NADN, Rodrigues, Coolidge and Prokop from selling fraudulent tax schemes, including Tax Break 2000. NADN ceased operations in May 2004.
“We view schemes like Tax Break 2000 as organized tax evasion” said Special Agent in Charge John Collins of IRS Criminal-Investigation (IRS-CI). “It is a top priority for the IRS to stop promoters of these harmful schemes. The public should remember the old saying ‘if it sounds too good to be true, it probably is.’ Instead of being a tax break this fraudulent product cost the victims much more in the end with interest and penalties.”
Acting Assistant Attorney General Ciraolo commended the special agents of IRS-CI who investigated the case. She also commended the substantial efforts of former Trial Attorneys Timothy J. Stockwell and Katherine L. Wong, and Paralegal Larry Garland of the Tax Division, who prosecuted the case, and Trial Attorney Mark L. Williams of the Tax Division, who assisted with sentencing. Acting Assistant Attorney General Ciraolo thanked the U.S. Attorney’s Office of the District of Nevada in Las Vegas for their substantial assistance.
Eugene Gang Member Sentenced to 10 Years for Possessing a Firearm as a FelonRead the Press Release
EUGENE, Ore. – On March 11, 2015, Gary Lee Walls, 39 years old, of Eugene, Oregon, was sentenced by U.S. District Judge Michael McShane to 10 years in federal prison for unlawful possession of a firearm. Upon his release from prison, Walls will be on supervised release for three years.
On August 29, 2013, Eugene Police Department officers arrested Walls for an outstanding parole violation and found him carrying a loaded handgun, knife, and methamphetamine. Walls is a member of the gang called the Insane Peckerwood Syndicate and has a lengthy criminal history, including prior felony convictions for robbery and kidnapping.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Eugene Police Department, and was prosecuted by Assistant U.S. Attorney Nathan J. Lichvarcik.
Ernest Dailey of Wilmington Sentenced for Possession with Intent to Distribute More Than 28 Grams of Cocaine Base and Firearms Violation 924(c)Read the Press Release
RALEIGH – United States Attorney Thomas G. Walker announced that today in federal court, Senior United States District Judge James C. Fox sentenced, ERNEST DAILEY, 48, of Wilmington, to 262 months of imprisonment followed by 5 years of supervised release.
DAILEY was named in an Indictment filed on August 27, 2014. On December 1, 2014, the Defendant pled guilty to Possession with the Intent to Distribute more than 28 grams of Cocaine Base and Possession of a Firearm During and In Relation to a Drug Trafficking Crime. According to the investigation and information presented in open court during the sentencing, on March 26, 2014, officers with the Wilmington Police Department executed a search warrant at DAILEY’S residence. During the search officers found over 44 grams of cocaine base, which is crack, approximately 6 grams of cocaine hydrochloride, $8,800 in US Currency, various drug paraphernalia and a 9 mm semi-automatic firearm. DAILEY admitted that he had been selling drugs and admitted taking the firearm in a form of payment for drugs. Due to DAILEY’S extensive criminal history, having approximately 12 prior drug convictions, he was designated as a Career Offender.
Investigation of this case was conducted by the Wilmington Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Special Assistant United States Attorney Charity Wilson prosecuted the case. Ms. Wilson is a prosecutor with the District 5 District Attorney’s Office encompassing New Hanover and Pender Counties. District Attorney Ben David has assigned her to the United States Attorney’s Office to prosecute violent crime, firearm related cases, and narcotic crimes.
Eleven Individuals Charged with Stealing and Fraudulently Using Personal Information of Blue Cross Blue Shield SubscribersRead the Press Release
Eleven individuals from metro-Detroit have been charged with running identity theft and credit card fraud schemes, U.S. Attorney Barbara L. McQuade announced today.
McQuade was joined in the announcement by Marlon Miller, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Jeffrey Frost, Special Agent in Charge of the U.S. Secret Service, Detroit Field Office and Chief Michael Patton, West Bloomfield Police Department, Southeast Michigan Financial Crimes Task Force.
Indicted for multiple counts of identity theft-related crimes were:
- Angela Denise Patton, 47, Belleville, MI
- Sam Oscar Patton, 47, Dearborn, MI
- Dontez Patton, 23, Woodhaven, MI
- Johnathon Weston, 24, Detroit, MI
- Charlie Smith, 47, Detroit, MI
- Thomas Turner, Sr., 47, Detroit, MI
- Aramona Coleman, 56, Southfield, MI
- Tynekwa Hill, 26, Pontiac, MI
- Jeffrey Morton, 41, Oak Park, MI
- Verdell Kennedy, 45, Detroit, MI
- Raymond Thomas, 40, Oak Park, MI
According to the indictment, Angela Patton, who worked for Blue Cross Blue Shield of Michigan (BCBSM), printed screen shots containing subscribers’ profiles, including Personal Identifying Information (PII), and gave them to other individuals who used that information to apply for credit in other people’s names and purchase merchandise in stores across the country. Co-conspirators were arrested in Texas, Ohio and Michigan in possession of BCBSM screen shots coming from Angela Patton’s work computer as well as counterfeit identification cards and credit cards in the names of individual subscribers whose personal information was included in those screen shots.
Agents recovered additional screen shots that included personal information belonging to thousands of BCBSM and Blue Care Network subscribers while executing search warrants at co-conspirators’ homes in metropolitan Detroit. The information included individuals’ names, dates of birth and Social Security numbers. Counterfeit and re-encoded credit cards and gifts cards were also recovered. The indictment alleges that three of the co-conspirators who used counterfeit credit cards at different major stores and warehouses fraudulently obtained more than $742,000 worth of merchandise from Sam’s Club alone.
United States Attorney McQuade, stated, "Criminals should know that while technology has made it easier than ever for them to commit identify fraud, technology is also making it easier for law enforcement to catch them. We are making enforcement of identity theft a high priority because this crime has become so pervasive and can be so damaging to victims.”
“An individual’s personal information has significant value on the black market, which is why the threat of data breaches and identity theft remain at an all-time high,” said Marlon Miller, HSI special agent in charge. “Over the last decade, we’ve seen a steady increase in crimes like this which is why HSI continues to prioritize and increase the quality and complexity of our investigative efforts to combat them.”
“As reflected by the indictments, United States Secret Service in Detroit—along with our federal, state and local partners—remains dedicated to the pursuit and apprehension of those responsible for these serious identity theft cases,” stated Jeff Frost, Special Agent in Charge of the Secret Service Detroit Field Office. “The continued, multi-jurisdictional collaboration between law enforcement resulted in the indictment of these individuals for their involvement in these crimes, and we will maintain our resolve as we continue to thoroughly investigate this case.”
"The entire West Bloomfield community is grateful for the great law enforcement partnership that has led to the continuing federal indictments related to these very serious crimes. As the investigation continues, this partnership remains devoted to bringing everyone that played a role in these incidents to justice," said Chief Michael Patton.
“Our company is determined to thoroughly investigate alleged fraud, and work hands-on with law enforcement to bring perpetrators of fraud and identity theft to justice,” said Gregory W. Anderson, vice president for Corporate and Financial investigations at Blue Cross Blue Shield of Michigan. “We salute the task force for these arrests, and for their diligent efforts to help Blue Cross protect our members’ personal information and privacy.”
If policy holders notice any inappropriate activity on their Explanation of Benefits statements, BCBSM and BCN ask members to contact the companies’ Anti-Fraud Hotline at 800-482-3787, between 8:30 a.m. and 4:30 p.m. Monday through Friday.
The case was investigated by the Southeast Michigan Financial and Cyber Crimes Task Force, which is based at the Novi Police Department and includes U.S. Secret Service, Homeland Security Investigations, the U.S. Postal Inspection Service, and IRS Criminal Investigations agents, as well as state and local law enforcement officers from the West Bloomfield, Novi, Royal Oak, Southfield, and Troy Police Departments.
The case is being prosecuted by Assistant U.S. Attorney Abed Hammoud with the United States Attorney’s Office for the Eastern District of Michigan in Detroit.
An indictment is only a charge and is not evidence of guilt. Every defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.El Dorado Hills Man Indicted for Embezzling More Than $400,000 from Former EmployerRead the Press Release
SACRAMENTO, Calif. — A federal grand jury returned a three-count indictment today against Jeffrey Lamson, 51, of El Dorado Hills, charging him with wire fraud, United States Attorney Benjamin B. Wagner announced.
According to court documents, from at least 2009 through 2011, Lamson embezzled over $400,000 from a company located in Placer and Sacramento Counties while he served that company as controller. Lamson used company funds to make unauthorized payments to himself and others and made payments to a fictitious vendor, controlled by Lamson, for services that were never performed.
This case is the product of an investigation by the Internal Revenue Service‑Criminal Investigation. Assistant United States Attorneys Shelley D. Weger and Jean M. Hobler are prosecuting the case.
If convicted, Lamson faces a maximum statutory penalty of 20 years in prison and a fine of $250,000 or twice the gain or loss caused by the fraud. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Eighteen Miami-Dade County Residents Charged for their Alleged Participation in Private Insurance Health Care Fraud SchemeRead the Press Release
Fourteen individuals were arrested today for their alleged participation in a scheme to defraud privately insured health care plans located in Miami-Dade County, including Cigna, Blue Cross Blue Shield (BCBS), United Health Care (UHC), Miami-Dade County Public Schools, City of Miami, Pepsi Co., BJ’s Wholesale Club, Inc., Lincoln Property Company, Macy’s Inc., Nextera Energy Inc., Radioshack Corporation, Sodexo, Inc., Southeast Frozen Foods Company LP, and other self-insured employers which offered Administrative Services Only (ASO) insurance plans to their employees.
ASO insurance plans reimbursed Cigna, BCBS, and UHS for the money paid out by the insurance companies for health benefits for their respective employees. Therefore, the employers acted in a self-insured role; making them financially responsible for any claim payments to their employees.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, FBI, Miami Field Office, Alysa D. Erichs, Special Agent in Charge, United States Immigration and Customs Enforcement, Homeland Security Investigations (ICE-HSI), J.D. Patterson, Director, Miami-Dade Police Department (MDPD), Ian A. Moffett, Chief, Miami-Dade Schools Police Department, Rodolfo Llanes, Chief, Miami Police Department (MPD), and Sergio Velazquez, Chief, Hialeah Police Department, made the announcement.
Reynaldo Castillo, 46, of Hialeah, Hendris Castillo Morales, 33, of Miami, Lisbet Castillo, 23, of Hialeah, Maite Garcia, 40, of Hialeah, Osvaldo Marin Medina, 48, of Hialeah, Alejandro Biart, 40, of Miami, Alejandro Jesus Cura, 47, of Miami, Dania Chavez, 43, of Miami, Ezequiel Severo Casas, 28, of Hialeah, Humberto Martinez Rodriguez, 43, of Hialeah, Jose Gerardo Gonzalez, 23, of Miami, Julio Suarez, 47, of Miami, Nelson Ramos, 56, of Miami, Reinaldo Cinta Gonzalez, 46, of Miami, Rudy N. Dominguez, 25, of Hialeah, and Diulys Martinez, 39, of Miami, were charged with Conspiracy to commit Health Care Fraud and Health Care Fraud in United States v. Reynaldo Castillo, et al., Case No. 15-20144-Cr-Scola. In addition, Maite Garcia was charged with Conspiracy to Pay Health Care Kickbacks and Payment of Kickbacks in Connection with a Federal Health Care Program.
As alleged in the indictment, Reynaldo Castillo, Hendris Castillo Morales, Lisbet Castillo Batista, and Maite Garcia owned and controlled 30 companies based in Miami, Hialeah, Hialeah Lakes, and Doral, Florida. These individuals utilized medical director staffing companies to obtain and misappropriate the names and licensing information for numerous physicians. This information was then used to submit false and fraudulent claims to the private insurance plans.
The indictment further alleges that Alejandro Biart accepted kickbacks from co-conspirators in return for referring Cigna, BCBS, and UHC beneficiaries to the medical clinics controlled by Reynaldo Castillo, Hendris Castillo Morales, Lisbet Castillo Batista, and Maite Garcia. These beneficiaries signed documents falsely and fraudulently representing that they had received medical services when, in fact, they had not received medical services.
The indictment additionally charges Maite Garcia for her role in paying kickbacks and bribes to certain beneficiaries in order to reimburse the beneficiaries for their monthly premium payments to Cigna.
According to the indictment, Osvaldo Marin Medina, Humberto Martinez Rodriguez, Alejandro Jesus Cura, Dania Chavez, Ezequiel Severo Casas, Jose Gerardo Gonzalez, Julio Suarez, Nelson Ramos, Reinaldo Cinta Gonzalez, Rudy N. Dominguez and Duilys Martinez agreed, in exchange for a fee, to have companies be placed in their names, to open bank accounts and check cashing accounts in the names of the companies, and to cash and deposit checks received from Cigna, BCBS, and UHC.
The indictment alleges that as a result of this scheme, Reynaldo Castillo together with his co-conspirators, submitted and caused to be the submitted false and fraudulent claims to private insurance plans, including Cigna, BCBS, UHC, and ASO insurance plans managed by Cigna, BCBS, and UHC, on behalf of the medical clinics seeking approximately $125,676,324.00, as reimbursement for injection treatments, physical therapy treatments, and other medical items and services which were neither ordered by a physician nor provided to a beneficiary as claimed. Based on these false and fraudulent claims, Cigna, BCBS, and UHC, as well as, ASO insurance plans managed by Cigna, BCBS, and UHC, paid the medical clinics approximately $13,853,392.00.
The indictment further alleges that Reynaldo Castillo, Lisbet Castillo Batista, and Hendris Castillo incorporated Investors Group of Florida Corp. to receive proceeds from the medical clinics and utilized those proceeds to purchase real estate properties. Investors Group of Florida Corp. was listed as owner of the purchased real estate properties and acted as the leasing agent. Reynaldo Castillo was the president and registered agent of Investors Group of Florida Corp. The real properties are subject to criminal forfeiture as specified in the indictment.
Osvaldo Marin Medina and Alejandro Biart were also charged in United States v. Ernesto Castillo, et al., Case No. 15-20017-Cr-Ungaro, together with Ernesto Castillo, 43, of Hialeah, and Danny Jacomino Bordon, 50, of Miami, for Conspiracy to Commit Health Care Fraud and Health Care Fraud.
The indictment alleges that Ernesto Castillo, Osvaldo Marin Medina, Alejandro Biart, Danny Jacomino Bordon, and their co-conspirators submitted and caused Amazing Medical Services Inc. (Amazing) to submit claims to Cigna seeking reimbursement in the amount of approximately $1,111,183.00, which claims falsely and fraudulently represented that medical services were prescribed by a doctor and provided to Cigna beneficiaries by Amazing. As a result of such false and fraudulent claims, Cigna made payments to Amazing in the approximate amount of $86,035.00.
The indictment further alleges that Ernesto Castillo, Osvaldo Marin Medina, Alejandro Biart caused Serenity Rehabilitation Center, Inc. (Serenity) to submit fraudulent claims to Cigna seeking reimbursement in approximately $1,806,800.00, which resulted in reimbursement payments to Serenity in the approximate amount of $252,259.00. The defendants also caused World of Rehabilitation Therapy, Inc. (World Rehab) to submit fraudulent claims to Cigna seeking reimbursement in the amount of approximately $2,245,300.00, which resulted in payments to World of Rehab from Cigna in the approximate amount of $889,151.00.
The indictment alleges that defendant Alejandro Biart accepted kickbacks from co-conspirators in return for referring Cigna beneficiaries to Amazing, Serenity, and World of Rehab.
Jose Gerardo Gonzalez, Reynaldo Castillo, Ezequiel Severo Casas, and Danny Jacomino Bordon remain at large.
Mr. Ferrer thanked the FBI, ICE-HIS, MDPD, Miami-Dade Schools Police Department, MPD, and the Hialeah Police Department for their investigative efforts. This case is being prosecuted by Assistant U.S. Attorney Christopher J. Clark.
An indictment is only an accusation and the defendants are presumed innocent until proven guilty.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Eight Alleged Members and Suppliers of Heroin Trafficking Organization ChargedRead the Press Release
NEWARK, N.J. – Eight people were charged today in connection with their roles in a drug trafficking organization that obtained heroin from Essex County, New Jersey, and supplied it to Central Jersey, U.S. Attorney Paul J. Fishman announced.
The defendants (see chart below) were each charged by complaint with one count of conspiracy to distribute 100 grams or more of heroin. Five of the eight defendants were arrested this morning as part of a coordinated takedown by federal, state and local law enforcement authorities and are scheduled to appear this afternoon before U.S. Magistrate Judge Mark Falk in Newark federal court.
According to the complaint:
The joint investigation by the Middlesex County Prosecutor’s Office and the Organized Crime and Drug Enforcement Task Force relied upon intercepted communications, physical surveillance, controlled heroin purchases, information from confidential sources and other investigative techniques. Law enforcement officers uncovered the operational structure and inner workings of the drug trafficking organization, which enriched a local street gang, the “Bounty Hunter Bloods.”
From October 2014 through March 2015, the defendants took part in a scheme to distribute heroin in an area known as “Parkside,” which straddles Franklin Township in Somerset County and New Brunswick in Middlesex County. Members of the drug trafficking organization transported the “raw,” or unpackaged, form of heroin from Essex County to Middlesex and Somerset counties and used stash houses and other temporary locations to package, store and distribute heroin. They attempted to avoid detection by using code to disguise the nature of their discussions and used prepaid cellular phones for short periods of time.
The defendants are:
Name
Age
Residence
40
Newark
Daniel Newsom, a/k/a “Spree,”
35
Franklin Township
David Miller
38
Franklin Township
Bruce Williams*
37
Newark
Juan Peralta
40
Newark
Anthony McBride*
57
New Brunswick
Tamir Styles*
37
Franklin Township
Myisha Wilson
36
Newark
(*remains at large)
Webb supplied heroin to Newsom, Miller, and Styles, all of whom lived in and around the Parkside neighborhood. He typically obtained the raw heroin suppliers, including Williams and Peralta. In some cases, Webb drove from Newark to Parkside to deliver the heroin; in other cases, Newsom, Miller, and others traveled to Newark to pick up the drugs from Webb.
The conspiracy count with which each of the defendants is charged carries a minimum potential penalty of five years in prison, a maximum of 40 years in prison, and a $5 million fine.
U.S. Attorney Fishman credited special agents of the Drug Enforcement Administration, under the direction of Special Agent in Charge Carl J. Kotowski; special agents of the Bureau of Alcohol, Tobacco, Firearms, and Explosives, under the direction of Special Agent in Charge George Belsky; detectives of the N.J. State Police, under the direction of Col. Rick Fuentes; officers of the Middlesex County Prosecutor’s Office, under the direction of Prosecutor Andrew C. Carey; and officers of the Somerset County Prosecutor’s Office, under the direction of Prosecutor Geoffrey D. Sorianno, with the joint investigation leading to today’s charges. He also thanked the North Brunswick, New Brunswick and Franklin Township police departments for their roles in the investigation.
The government is represented by Assistant U.S. Attorneys Andrew Bruck and Jonathan W. Romankow of the office’s Organized Crime/Gangs Unit in Newark.
The charge and allegations contained in the complaint are merely accusations and the defendants are presumed innocent unless and until proven guilty.
14-087
District Court Enters Permanent Injunction Against Texas Pharmacy and Senior Executives to Prevent Distribution of Adulterated and Misbranded DrugsRead the Press Release
The U.S. District Court for the Western District of Texas entered a consent decree of permanent injunction against Specialty Compounding LLC, Raymond L. Solano III and William L. Swail to prevent the distribution of adulterated and misbranded drugs, the Department of Justice announced today.
The department filed a complaint in the U.S. District Court for the Western District of Texas on Feb. 23, at the request of the U.S. Food and Drug Administration (FDA). According to the complaint, Specialty Compounding manufactured both sterile and non-sterile drugs at a facility in Cedar Park, Texas, and distributed the company’s drugs to hospitals, surgery centers and health clinics in Texas and throughout the United States. As noted in the complaint, Solano is Specialty Compounding’s pharmacist-in-charge and co-owner, and Swail is Specialty Compounding’s Managing Partner and co-owner.
The complaint alleges that Specialty Compounding manufactured a sterile injectable drug product that tested positive for bacterial growth. In addition, according to the complaint, in August 2013, FDA received reports from two Texas hospitals that 17 patients had developed bacterial infections caused by Rhodococcus equi after receiving infusions of calcium gluconate manufactured by Specialty Compounding. Specialty Compounding ceased sterile drug manufacturing operations in August 2013, and recalled all lots of its unexpired sterile drug products distributed since Feb. 1, 2013.
“Specialty Compounding’s manufacturing practices posed a serious risk to the public health,” said Acting Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division. “The American public needs to have the confidence that pharmaceutical drugs on the market are safe and effective.”
In conjunction with the filing of the complaint, the defendants agreed to settle the litigation and be bound by a permanent injunction. As part of the settlement, the company and its owners have committed to implementing corrective actions before resuming production of sterile drugs. Specifically, the injunction prohibits Specialty Compounding and its owners from manufacturing, holding or distributing sterile drugs until they comply with the federal Food, Drug, and Cosmetic Act and its regulations. The permanent injunction also provides the defendants cannot resume distribution of sterile drug products until they receive written approval from the FDA that they are in compliance with the remedial provisions of the permanent injunction.
As described in the complaint, the FDA inspected Specialty Compounding’s Cedar Park facility in August and September 2013, and found insanitary conditions and numerous violations of the current good manufacturing practice requirements for drug products. Among other observations, the FDA found that the company was distributing some of their drugs without receiving a valid prescription for an identified individual patient and was introducing into interstate commerce unapproved new drugs and misbranded drugs. In addition, as alleged in the complaint, analyses of samples of a drug product collected by the FDA found bacterial contamination in one of the company’s drugs. The company initiated a recall of all injectable drugs on Aug. 9, 2013.
The government is represented by Trial Attorney Jessica Gunder of the Civil Division’s Consumer Protection Branch, with the assistance of Associate Chief Counsel Melissa Mendoza of the Department of Health and Human Services’ Office of General Counsel’s Food and Drug Division.
Detroit man sentenced to 4+ years in federal pill caseRead the Press Release
Defendant caught with more than 300 pills hidden in detergent box
HUNTINGTON, W.Va. – Kendall Lamar Spears, 35, of Detroit, Michigan, was sentenced to 51 months in federal prison after a December 2014 jury conviction on possession with intent to distribute oxymorphone, U.S. Attorney Booth Goodwin announced today. In late October 2012, Spears paid a Huntington couple to drive him to Detroit under the pretense of allowing him to visit family. After they arrived in Detroit, Spears left the couple for approximately an hour and returned with several bags from a Family Dollar store. He then went into a back room of the apartment in which the couple was waiting, where, according to trial testimony, Spears remained for approximately one hour before notifying the couple that he was ready to return to Huntington.
While in Detroit, the female who was driving Spears called her mother and told her that she was concerned that Spears was bringing heroin back to Huntington for resale. The woman’s parents relayed the information to members of the Huntington Police Department, who, along with agents from the Huntington Violent Crime and Drug Task Force, set up surveillance in anticipation of the group’s return. When law enforcement saw the van traveling back into Huntington, they stopped it and, with the owner’s permission, searched it. During the search, agents seized 302 oxymorphone pills inside a box of detergent located inside a Family Dollar bag in the seat where Spears had been riding.
Following the discovery of the pills, the couple informed law enforcement that they were unaware of what the package contained.
Chief United States District Judge Robert C. Chambers presided over the two-day jury trial and the sentencing hearing.
Detroit man convicted of selling oxycodone near MorgantownRead the Press Release
CLARKSBURG, WEST VIRGINIA – Terrell Moore, 35, of Detroit, Michigan, was convicted in federal court today of oxycodone trafficking, United States Attorney William J. Ihlenfeld, II, announced today.
An investigation by the Greater Harrison County Drug and Violent Crime Task Force, a HIDTA-funded initiative, revealed that Moore sold oxycodone in January 2015 in Monongalia County, West Virginia. He pled guilty today to a criminal Information charging him with one count of “Distribution of Oxycodone.” He faces up to 20 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.
As part of the plea agreement, Moore also agreed to forfeit his interest in a 2010 Ford Fusion vehicle.
Assistant U.S. Attorney Shawn Morgan is prosecuting the case on behalf of the government.
U.S. Magistrate Judge John S. Kaull presided.
Canton Couple Sent to Prison for $2.3 Million Student Loan FraudRead the Press Release
A Canton couple was sentenced to prison for defrauding the United State Department of Education out of more than $2.3 million by obtaining fake high school diplomas for prospective students, fraudulently applying for financial aid on their behalf by representing that the students had the necessary educational credentials, and then enrolling them in the college that the couple operated, law enforcement officials said.
John “Richard” Ceroni, 65, was sentenced to 69 months in prison. Adale “Marie” Cernoni, 63, was sentenced to 55 months in prison. They were ordered to pay more than $2.3 million in restitution.
The Ceronis pleaded guilty to conspiracy to commit mail fraud and conspiracy to launder money. Richard Ceroni also pleaded guilty to obstruction.
The Ceronis were co-founders Carnegie Career College. From at least 2003, Carnegie College held itself out to the public as a private not-for-profit college that offered a select number of associate degrees, as well as various “certificate” programs in areas such as blood drawing.
Around 2002, Richard Ceroni applied with the Department of Education to participate in the federal student financial aid (SFA) program. That application was approved in December 2003, according to court documents.
Richard Ceroni was dean and director of education at Carnegie College, while Marie Ceroni was the director of Carnegie and was responsible for financial matters at the school. Richard Ceroni was also founder of Historical Chapel Ministries (HCM), which was registered as a tax-exempt charitable organization. It had offices in the same building as Carnegie College in Suffield, Ohio. Both Ceronis held themselves out as ministers of HCM, but it did not have regular services or congregants, according to court documents.
In February 2007, Carnegie College opened a branch “campus” that operated in a single-family home in Canton. In 2010, Carnegie moved its branch campus to a commercial building in North Canton, which also hosted a variety of other Ceroni ventures, including a driving school and a massage service, according to the indictment.
From June 2007 through May 2012, the Ceronis fraudulently obtained approximately $2.3 million from the Department of Education by submitting applications for SFA funds that stated students at Carnegie College had obtained valid high school diplomas; they also falsely told prospective students they would earn a valid high school diploma at the same time they attended Carnegie College and that such a diploma would be paid for by a “scholarship from a church” in order to increase enrollment and access to SFA funds, according to court documents.
The Ceronis recruited students who had not earned high school diplomas or G.E.D. certificates, and thus were not eligible for SFA funds, and submitted fraudulent financial aid documents to the Department of Education. They used online high schools, including Australia-based Adison High School, to purchase fake high school diplomas and coursework transcripts for students who were not required to attend any classes or complete any coursework, according to court documents.
Marie Ceroni paid Adison High School, which provided diplomas using the graduation date on which the student would have graduated from high school had they completed high school in the normal course. Sometimes those dates predated general public access to the Internet, according to court documents.
The Ceronis comingled fraudulently obtained money in several accounts and used that money to fund personal expenditures and expand Carnegie College. Between February 2011 and February 2012, for example, Marie Ceroni made more than $475,000 in large cash withdrawals from two accounts that operated under the Historical Chapel Ministries name. Money from those accounts was used to make under-the-table cash payments to the defendants and other Carnegie College employees who the Ceronis claimed were unpaid volunteers, according to court documents.
There were also payments using comingled funds from a several accounts, including: on July 8, 2010, Marie Ceroni wrote a check for $100,038 to pay off a personal line of credit; on Dec. 17, 2010, Marie Ceroni wrote a check for $119,230 to pay off a personal line of credit that was used, among other things, to purchase two Jeep vehicles; in 2012, the Ceronis wrote check to pay credit card balances that included charges for fake Adison High School diplomas and transcripts; in 2010, Marie Ceroni made and caused to be made electronic fund transfers to pay for credit cards that included charges of more than $4,300 from Royal Caribbean Cruises and more than $800 from Airtran; in 2011, similar electronic transfers were made to pay off credit card charges from stores including Victoria’s Secret, Wine & Spirits, Simply Tans and the University of Akron bookstore; on July 11, 2011, Marie Ceroni wrote a check for $15,650 to Jared Jewelers; on Nov. 22, 2011, she wrote a check for $24,808 to Zale’s to pay for wedding bands for the couple’s daughter; on Jan. 12, 2012, she wrote a check for $3,806 to Jared Jewelers and nine days later wrote another check to Jared Jewelers for $9,782, according to court documents.
This case is being prosecuted by Assistant U.S. Attorneys Rebecca Lutzko and Robert Patton following an investigation by the United States Department of Education – Office of Inspector General, the Federal Bureau of Investigation and the Internal Revenue Service – Criminal Investigation Division.
California Man Sentenced for Federal Heroin Trafficking Conviction in New MexicoRead the Press Release
ALBUQUERQUE – Curtis Wallace Pack, Jr., 31, of San Diego, Calif., was sentenced this morning in federal court in Santa Fe, N.M., to 60 months in prison followed by four years of supervised release for his heroin trafficking conviction.
Pack was arrested on Sept. 12, 2013, at the Greyhound Bus Station in Albuquerque, N.M., after a consensual search by DEA agents revealed that Pack had concealed bundles containing approximately .95 kilograms of heroin inside a gift-wrapped package. Pack subsequently was indicted on Oct. 9, 2013, and charged with possession of heroin with intent to distribute.
Pack entered a guilty plea to the indictment on March 14, 2014, and admitted possessing the heroin with the intent to distribute in Bernalillo County, N.M.
This case was investigated by the Interdiction Unit of the DEA’s Albuquerque office, which focuses on disrupting the flow of narcotics, weapons, and the proceeds of illegal activities as they are smuggled into or through New Mexico in passenger buses, passenger trains, commercial vehicles and automobiles. Assistant U.S. Attorney Paul Mysliwiec prosecuted the case.
This case was prosecuted pursuant to the New Mexico Heroin and Opioid Prevention and Education (HOPE) Initiative. The HOPE Initiative is a collaborative effort between the U.S. Attorney’s Office and the University of New Mexico Health Sciences Center that is partnering with the Bernalillo County Opioid Accountability Initiative with the overriding goal of reducing the number of opioid-related deaths in the District of New Mexico. The HOPE Initiative comprised of five components: (1) prevention and education; (2) treatment; (3) law enforcement; (4) reentry; and (5) strategic planning. The law enforcement component of the HOPE Initiative is led by the Organized Crime Section of the U.S. Attorney’s Office and the DEA in conjunction with their federal, state, local and tribal law enforcement partners. Targeting members of major heroin trafficking organizations for investigation and prosecution is a priority of the HOPE Initiative.
Buffalo Man Pleads Guilty to Gun Charges Involving Two MurdersRead 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 Brandon Jonas, 29, of Buffalo, NY, pleaded guilty to two counts of discharge of a firearm in furtherance of a crime of violence before U.S. District Judge Richard J. Arcara. The charges carry a mandatory minimum penalty of 35 years in prison, a maximum of life, a $250,000 fine or both.
Assistant U.S. Attorneys Joseph M. Tripi and Wei Xiang, who are handling the case, stated that on November 11, 2004, the defendant shot and killed Nelson and Miguel Camacho, who were brothers, inside a residence on Niagara Street on Buffalo’s West Side.
The defendant, along with co-defendants Efrain Hidalgo and Misael Montalvo, received information that the brothers might have large amounts of money or drugs and would be good targets to rob. On November 11, 2004, defendant Montalvo drove Jonas and Hildalgo to the vicinity of the Niagara Street residence. Jonas was armed with an AK-47 style rifle and Hidalgo had a baseball bat. After surveilling the residence, Jonas and Hildalgo forced their way into the residence in an attempt to rob money and drugs from the brothers. During the robbery attempt, Jonas shot and killed the Camachos.
Josue Ortiz served 10 years in state prison for the murders of Nelson and Miguel Camacho. His conviction was recently vacated by an Erie County Court judge based on the findings of this federal investigation.
Efrain Hildalgo was convicted and is scheduled to be sentenced on June 17, 2015 at 1:00 p.m. Charges are still pending against Misael Montalvo. The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
The plea is the culmination of an investigation on the part of Special Agents of the Federal Bureau of Investigation Safe Streets Task Force, the New York State Police, under the direction of Major Michael Cerretto, the Buffalo Police Department, under the direction of Commissioner Daniel Derenda, and the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Delano A. Reid.
Sentencing is scheduled for June 29, 2015 at 1:00 p.m. before Judge Arcara.
Boone County man sentenced to federal prison in meth caseRead the Press Release
CHARLESTON, W.Va. – Chris Curry, 37, of Nellis, Boone County, West Virginia, was sentenced to six months in federal prison and three years’ supervised release, U.S. Attorney Booth Goodwin announced today. Curry previously pleaded guilty in December 2014, admitting that he had agreed to receive a package containing methamphetamine for another person. Curry further admitted that he was to have received a small amount of the methamphetamine in exchange for accepting delivery of the package to his residence.
United States District Judge Thomas E. Johnston imposed today’s sentence.
The successful prosecution of Curry was the result of an investigation by agents of the Drug Enforcement Administration and the West Virginia State Police.
61 Individuals Indicted for Drug TraffickingRead the Press Release
SAN JUAN, Puerto Rico – On March 4, a federal grand jury in the District of Puerto Rico returned an indictment against 61 defendants charged with conspiracy to possess with intent to distribute controlled substances in the municipalities of Manatí, Barceloneta, and Florida, PR, announced Rosa Emilia Rodríguez-Vélez, United States Attorney for the District of Puerto Rico. Immigration and Customs Enforcement, Homeland Security Investigations (ICE-HSI) is in charge of the investigation, with the collaboration of the Puerto Rico Police Department, specially the Arecibo Strike Force, and the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).
The indictment alleges that beginning in 2000, the organization distributed crack, heroin, cocaine, marihuana, Oxycodone (commonly known as “Percocet”), and Alprazolam (commonly known as “Xanax”) within 1,000 feet of a real property comprising a housing facility owned by a public housing authority. The object of the conspiracy was to distribute controlled substances at the Enrique Zorilla Public Housing Project, the Los Murales Public Housing Project, the Cortes Ward, the San José Ward and the Acueducto Ward, all located in the Municipality of Manatí, PR. The conspiracy also distributed controlled substances at V & B Public Housing Project in the Municipality of Barceloneta, and the Villas de Florida Public Housing Project, located in the Municipality of Florida; all for financial gain and profit.
The 61 co-conspirators had many roles in order to further the goals of the conspiracy. According to the indictment this organization had up to 12 leaders/drug point owners/enforcers, two narcotics suppliers, at least 11 runners, six drug processors, 24 sellers, three look-outs/facilitators. Eighteen of the individuals are facing one count of possessing firearms in furtherance of a drug trafficking crime.
The 61 defendants are: Carlos Gotay Guzmàn, a.k.a. “Moro;” Javier Gonzàlez Pérez, a.k.a. “Javier Tornillo;” Reinaldo Colón Oliveras, a.k.a. “Tito Capao; Roberto Maldonado Rodríguez, a.k.a. “Robert El Calvo;” Carlos Vàzquez Otero, a.k.a. “Carlos Misquin;” Julio Alberto Rivera-Rodríguez, a.k.a. “Ito;” Eric O. Rosa Ramos, a.k.a. “El Indio;” Jorge L. Alicia Pagàn, a.k.a. “Bebo Conejo;” Alfredo Virella Laureano, a.k.a. “Keko;” Christian Rodríguez Rivera, a.k.a. “Cuso;” José M. Rivera Molina, a.k.a. “Bolillo;” Jonathan Ortiz Salgado, a.k.a. “Cochi;” Juan Ramiro Fonseca-Otero, a.k.a. “Burro;” Héctor Moreno Rivera, a.k.a. “Mickey Bay;” Aníbal García Quiñones, a.k.a. “Junior El Manco;” Luis Daniel Rosa-Santiago, a.k.a. “Luisda;” José Resto-Laureano, a.k.a. “Piti;” Jaime Freytes Maldonado, a.k.a. “Micro;” Alexander Avilés Santiago, a.k.a. “Pipo;” Héctor Colón Romero, a.k.a. “Coscu;” Ulises Soto Soto; Jose Luis Ortiz Vega, a.k.a. “Bebo Chino;” Christian Pantoja-Sànchez, a.k.a. “Wolf;” Ernie Vega Cruz, a.k.a. “Ernie Perla;” Jonathan Figueroa Hernàndez, a.k.a. “Jonathan Mickey Mouse;” Roberto R. Valle Cordero, a.k.a. “Robert de Niro;” Ramón J. Figueroa Colón, a.k.a. “Bengay;” Josué Salgado Pagàn, a.k.a. “Tony Monaco;” Héctor Earl Montilla-Battice, a.k.a. “Cacho;” Christian Torres Moràn, a.k.a. “Palomita;” Jessie Vega Quiñones; Alex José Babilonia-Torres, a.k.a. “Alex Moña;” Luis Ernesto Gonzàlez Moreno, a.k.a. “Poeta;” Luis M. Cortés Class, a.k.a. “Luis El Loco;” Héctor M. Rodríguez Soto, a.k.a. “Buddhita;” Omar E. Mendoza Vidal, a.k.a. “Cuajo;” Edwin Montijo Gonzàlez, a.k.a. “Joel Sandwich;” Luis Centeno Ortiz; Edwin Mendoza Vargas, a.k.a. “Pito Chuli Mami;” Rubén de Jesús-Ortiz, a.k.a. “Rubencito;” José Rivera Medina, a.k.a. “Pito Llaga;” Jovanny Reyes Sànchez, a.k.a. “Jovanny El Lento;” Elizabeth Gerena Santiago, a.k.a. “Eli La Mona;” Kelvin Xavier Nieves-De Jesús, a.k.a. “Kelvin Blue;” Ruben Larregui López, a.k.a. “Cusito;” Fernando J. Muñíz Vega, a.k.a. “Joel Vega;” Emmanuel Salgado Gonzàlez, a.k.a. “Mejico;” Danny Salgado Gonzàlez, a.k.a. “Danny;” Luis A. Serrano Aponte, a.k.a. “Cachi;” Luis Ángel Siragusa Soto, a.k.a. “El Gordo Siragusa;” Carlos José Siragusa Soto, a.k.a. “Bebe Siragusa;” Christian O. Rodríguez Morales, a.k.a. “Christian El Lento;” Dennis Colón Laureano, a.k.a. “Buho;” Shaquille E. Rivera de Jesús; Ruth Emily Hernaiz Rojas, a.k.a. “Ruty;” Luis Antonio Ibañez-Bello, a.k.a. “Gordo Ibanez;” José Antonio Acevedo Nazario, a.k.a. “Sindicato;” Beatriz de Los Angeles Ortiz-Sànchez, a.k.a. “Bea;” José O. Padilla Flores, a.k.a. “Landi;” Jorge Rivera Sànchez; and Delgado Díaz.
Defendants José Antonio Acevedo-Nazario, aka “Sindicato;” José O. Padilla-Flores, aka “Landi;” Reinaldo Colón-Oliveras, aka “Tito Capao;” Jorge Rivera-Sànchez; and Leslie Delgado-Díaz are each facing one count of conspiracy to commit money laundering. Defendant Josué Salgado-Pagàn, aka “Tony Monaco” is facing two counts of money laundering.
“This is the second arrest operation against a gang in Manatí in the last three weeks. These arrests will keep the law-abiding citizens in these areas safer from the inevitable violence that drug trafficking brings,” said U.S. Attorney Rodríguez-Vélez. “These arrests are a clear indication of the success of the OCDETF program in the fight against drug trafficking.”
“This case exemplifies that those involved in the distribution of narcotics and other contraband will be vigorously investigated and prosecuted,” said Ángel M. Meléndez, Special Agent in Charge of HSI San Juan. “HSI thanks our local, state and federal law enforcement partners for their significant cooperation in dismantling this drug trafficking organization.”“ATF continues to be in the forefront in fighting against firearms trafficking and firearms related violence. The area of Manatí, PR wakes up a safer place thanks to the Federal, State and Local law enforcement partnership,” said Hugo Barrera, ATF Special Agent in Charge.
The defendants were the targets of a long-term Organized Crime Drug Enforcement Task Force (OCDEFT) investigation. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
Assistant U.S. Attorney Edward Veronda is in charge of the prosecution of the case. If convicted the defendants face a minimum sentence of 10 years up to life in prison. Indictments contain only charges and are not evidence of guilt. Defendants are presumed to be innocent until and unless proven guilty.
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