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Thursday 26 February 2015
Charlestown Career Criminal Pleads Guilty to Possessing AmmunitionRead the Press Release
BOSTON – Joseph J. Kennedy, 27, of Charlestown, pleaded guilty to being a previously convicted felon in possession of ammunition. U.S. District Court Judge Douglas P. Woodlock scheduled sentencing for June 1, 2015.
On May 7, 2014, Kennedy, who was the subject of an outstanding arrest warrant, was observed driving a vehicle in Charlestown.Kennedy was apprehended and the arresting officers discovered a stolen safe in his vehicle which contained multiple rounds of ammunition.
As an armed career criminal, the defendant is subject to a mandatory minimum sentence of 15 years in prison and no greater than life, five years of supervised release, and a $250,000 fine. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz; Daniel J. Kumor, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms, and Explosives; John Gibbons, U.S. Marshal of the U.S. Marshals Service, District of Massachusetts; and Boston Police Chief William Evans, made the announcement today. The case is being prosecuted by Assistant U.S. Attorneys Kenneth G. Shine and Mary B. Murrane of Ortiz’s Major Crimes Unit.
Charleston man sentenced for distributing heroinRead the Press Release
CHARLESTON, W.Va. – United States Attorney Booth Goodwin announced today that Kennele Groom, 36, of Charleston, was sentenced to 58 months in federal prison.
In May 2014, Groom pleaded guilty to distributing heroin in Charleston. On Jan. 14, 2014, officers searched Groom’s residence in the 1200 block of Griffith Drive in Charleston, finding more than $20,000 cash and more than 12 grams of heroin. Another $1,979 cash was found on Groom when he was arrested. Groom admitted that he traveled to Cincinnati to purchase heroin to sell in the Charleston area.
Groom sold heroin to a confidential informant on three separate occasions in Charleston prior to his arrest.
United States District Judge Thomas E. Johnston imposed the sentence.
The case was investigated by Charleston Police Department. Assistant United States Attorney Steven I. Loew handled the prosecution.
The case was prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and heroin. The U.S. Attorney’s Office, joined by federal, state and local law enforcement, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
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Carlsbad Woman Pleads Guilty to Violating Federal Firearms LawsRead the Press Release
ALBUQUERQUE – Deloris Lozuaway, 61, of Carlsbad, N.M., pleaded guilty yesterday afternoon in federal court in Las Cruces, N.M., to being a felon in possession of firearms. The guilty plea was entered without the benefit of a plea agreement.
Lozuaway was arrested on Aug. 11, 2014, in Denver, Colo., by the Bureau of Alcohol, Tobacco, Firearms and Explosives and transferred to New Mexico to face the charges in an indictment alleging that she unlawfully possessed a firearm on Feb. 15, 2013 and on March 7, 2013, in Eddy County, N.M. According to court filings, Lozuaway was prohibited from possessing firearms or ammunition because she previously had been convicted of false pretenses and armed robbery.
Lozuaway entered a guilty plea to two counts of being a felon in possession of a firearm and admitted possessing rifles in Feb. 2013 and March 2013. Lozuaway also acknowledged that she was prohibited from possessing firearms because she was a convicted felon.
Lozuaway has been in federal custody since her arrest and remains detained pending her sentencing hearing, which has yet to be scheduled. At sentencing, Lozuaway faces a statutory maximum sentence of ten years in federal prison.
This case was investigated by the Las Cruces office of the Bureau of Alcohol, Tobacco, Firearms and Explosives and is being prosecuted by Assistant U.S. Attorney Luis A. Martinez of the U.S. Attorney’s Las Cruces Branch Office.
Californian Sentenced to 41 Months in Prison for Failing to Update his Sex Offender RegistrationRead the Press Release
ALEXANDRIA, La. – United States Attorney Stephanie A. Finley announced today that a California man was sentenced to 41 months in prison for failing to register as a sex offender after traveling to Alexandria.
Tyrone Bradshaw, 47, of Los Angeles, Calif., was sentenced by U.S. District Judge Dee D. Drell for one count of failure to register as a sex offender. He was also sentenced to 17 years of supervised release. He will begin serving the sentence after serving the remainder of a 32-month prison term in California for a previous failure to register charge. According to evidence presented at the November 25, 2014 guilty plea, Bradshaw traveled by bus to Alexandria on August 1, 2012. He obtained a state identification card on August 3, 2012 and listed his address as Lake Charles, La. He did not include his sex offender status on the identification as required by Louisiana state law. Alexandria police later arrested Bradshaw. The defendant previously pleaded guilty in November of 1985 to state charges in California for kidnapping, forcible rape, and robbery of a female. He was released in 1994.
The U.S. Marshals Service and the Alexandria Police Department conducted the investigation. Assistant U.S. Attorney F. Michael O’Mara prosecuted the case.
California Financier Charged in Alleged Ponzi SchemeRead the Press Release
Former CEO and Corporate Counsel of Financial Services Marketing Company Previously Pleaded Guilty
A California man and purported billionaire financier was taken into federal custody today for his role in an alleged Ponzi scheme in which investors lost $2.5 million, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and Inspector in Charge Gary Barksdale of the U.S. Postal Inspection Service’s Criminal Investigations Group.
Kenneth Brewington, 50, of Corona, California, was indicted on Feb. 24, 2015, by a federal grand jury in the District of Colorado for conspiracy to commit wire and mail fraud, mail fraud and six counts of wire fraud.
According to allegations in the indictment, from September 2009 until 2011, Brewington and his co-conspirators sold promissory notes to investors through a financial services marketing company based in Denver called Compass Financial Solutions (CFS). The indictment alleges that Brewington and his co-conspirators falsely represented to investors that Brewington held millions of Euros in overseas bank accounts, and that the proceeds raised from investors would be used to obtain the release of his overseas funds. To conceal the scheme, Brewington and his co-conspirators allegedly had investors wire their funds to an attorney trust account. The funds from that account, however, were then allegedly sent to Brewington and his co-conspirators. Brewington and his co-conspirators allegedly used the investors’ money for their own personal benefit.
The former corporate counsel for CFS, William E. Dawn, 77, of Denver, and the former CEO of CFS, Brian G. Elrod, 58, of Lakewood, Colorado, previously pleaded guilty for their roles in the scheme. Sentencing hearings are scheduled for May 29, 2015, and May 22, 2015, respectively.
The charges contained in an indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
The case was investigated by the U.S. Postal Inspection Service, and is being prosecuted by Trial Attorneys Henry P. Van Dyck and Jennifer G. Ballantyne of the Criminal Division’s Fraud Section. The Securities and Exchange Commission has provided substantial assistance in this matter.
Brockport Man Pleads Guilty to Mail Fraud and Forging Treasury ChecksRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
ROCHESTER, N.Y. - U.S. Attorney William J. Hochul, Jr. announced today that Steven Ray, 49 of Brockport, NY, pleaded guilty to one count of mail fraud and one count of forging treasury checks before U.S. Magistrate Judge Marian W. Payson. The mail fraud charge carries a maximum penalty of 20 years in prison, a fine of up to $250,000, or both. Forging treasury checks carries a maximum penalty of 10 years in prison, a fine of up to $250,000, or both.Assistant U.S. Attorney Craig R. Gestring, who is handling the case, stated that Ray admitted to cashing more than 120 forged United States Treasury Checks worth more than $400,000. The checks were stolen from the New York City Area as well as from other parts of the United States. Ray would get the stolen checks mailed to him via the United States Postal Service at his Brockport home.
A review of United States Postal Service records confirmed that between March 2013 and August 2013, at least 20 Express Mail pieces addressed from Lithonia, GA had been delivered to Ray's Brockport residence. The defendant told investigators that he had the packages addressed to his adult daughter, claiming that someone needed to sign for them during the day, however, Postal records showed that none of the Express Mail pieces involved actually required a signature for delivery.
During the investigation, federal agents identified at least 13 area bank accounts controlled by the defendant under various names. The defendant would take the stolen Treasury Checks he received by mail and then deposit them across these accounts. Many of the checks belonged to people who received Social Security payments, tax refunds, and other money drawn from the United States Treasury to help the intended recipients.
One stolen $33,000 check, deposited by Ray in May 2013, was meant as a retirement disbursement for a woman in California. When questioned by investigators, the defendant claimed that he got the check as a down payment for the sale of some local property to a woman he had never met who came into his store one day. Ray told the bank a different story for why he was depositing this check, and claimed that he was friends with the woman named on the check and claimed it was for the purchase of a different piece of property than that which he told investigators. However, when investigators tracked the victim down and interviewed her, she denied knowing the defendant or any of his related businesses. She told law enforcement that she never received her check, never endorsed her check, never deposited her check into the defendant’s account, and never authorized anyone else to do so. She did not buy any property from the defendant or anyone else in Western New York.
As a result of the defendant’s scheme to defraud, Ray obtained more than $405,000 to which he was not otherwise entitled. During the investigation, federal agents were able to recover almost $100,000 in stolen funds, which was returned to the rightful recipients.
The plea is the culmination of an investigation on the part of Inspectors from the United States Postal Inspection Service, under the direction of Shelly Binkowski, Inspector In Charge of the Boston Division, and Special Agents of the Internal Revenue Service, Criminal Investigation Division, under the Direction of Special Agent in Charge of the New York Field Office, Shantelle P. Kitchen.
Sentencing is scheduled for May 26, 2015 at 10:00 a.m. before U.S. District Court Judge David G. Larimer.
Bridgeport Man Sentenced to 17 Years in Federal Prison for Heading Drug Trafficking RingRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that RONELL HANKS, also known as “Biz” and “Ace,” 25, of Bridgeport, was sentenced today by Chief U.S. District Judge Janet C. Hall in New Haven to 204 months of imprisonment, followed by five years of supervised release, for heading a large Bridgeport-based narcotics trafficking ring.
According to court documents and statements made in court, in January 2012, the FBI Bridgeport Safe Streets Task Force, Bridgeport Police Department and Connecticut State Police Statewide Narcotics Task Force began an investigation into narcotics trafficking and violent criminal activity in and around the Trumbull Gardens housing complex in Bridgeport. The investigation revealed that HANKS headed an organization that sold heroin, cocaine and crack cocaine 24-hours a day, seven days a week.
During the course of the investigation, investigators seized approximately one kilogram of heroin, one-half kilogram of crack cocaine, approximately $100,000 in cash, three vehicles, jewelry, nine firearms, and more than 200 rounds of ammunition.
Investigators seized a firearm, which had been reported stolen, from HANKS’ residence, and also a KelTec EC372 assault-style firearm and ammunition that HANKS had provided to another individual for safe keeping on his behalf.
On December 18, 2013, a grand jury in Bridgeport returned an indictment charging HANKS and 13 other individuals with narcotics and firearms trafficking offenses.
HANKS has been detained since his arrest on December 5, 2013. On August 21, 2014, he pleaded guilty to one count of conspiracy to distribute and to possess with intent to distribute 100 grams or more of heroin and 500 grams or more of cocaine.
HANKS was ordered to forfeit three vehicles, approximately $80,000 in jewelry and $72,000 in cash.
HANKS’ criminal history includes multiple felony convictions.This matter is being investigated by the FBI’s Bridgeport Safe Streets Task Force, in coordination with the Bridgeport Police Department, the Trumbull Police Department and the Connecticut State Police Statewide Narcotics Task Force. The Bureau of Alcohol, Tobacco, Firearms and Explosives, and the State’s Attorney for the Judicial District of Fairfield are assisting this investigation and prosecution. The case is being prosecuted by Assistant U.S. Attorneys Tracy Lee Dayton and Rahul Kale.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Branson EMT, Joplin Couple Among Those Indicted for Child Sexual ExploitationRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Branson, Mo., EMT and a Joplin, Mo., couple are among five persons indicted by a federal grand jury yesterday in four separate and unrelated cases related to the sexual exploitation of children.
“Protecting the most vulnerable members of our society is a top priority of the Department of Justice,” Dickinson said. “We are committed to protecting our children from sexual predators and bringing their abusers to justice. Exploiting and abusing a child to produce pornography – as charged in each of these indictments – carries a tough mandatory minimum sentence of 15 years in federal prison without parole.”
USA v. Dickerson
Nicholas James Dickerson, 30, of Branson, Mo., was charged in an indictment returned by a federal grand jury in Springfield, Mo. Dickerson is employed by the Western Taney County Fire Protection District as an EMT and volunteer firefighter. Dickerson was residing in living quarters at a Branson fire station at the time of the alleged offense.
The federal indictment alleges that Dickerson used a minor to produce child pornography on Feb. 7, 2015. The indictment replaces a federal criminal complaint that was filed against Dickerson on Feb. 19, 2015.
According to an affidavit filed in support of the original criminal complaint, Dickerson sold his iPhone to a Nixa, Mo., business on Feb. 9, 2015. An employee of the business noticed Dickerson deleting images or files from the phone while standing at the counter, the affidavit says, and after the transaction was complete the employee noticed that the “deleted pictures folder” was still present on the screen. The employee saw an image that appeared to be child pornography and alerted the store owner, who contacted law enforcement.
Investigators identified the nine-year-old victim in the image. Dickerson told investigators that he took the photo while sexually abusing the child victim in his living quarters at the fire station, the affidavit says, and that he sexually abused the victim on multiple occasions. Dickerson also told investigators he had shown pornography to the child victim.
This case is being prosecuted by Assistant U.S. Attorney Ami Harshad Miller. It was investigated by the FBI.
USA v. Britten
Ernest Britten, 36, of Joplin, Mo., and his ex-wife, Kendra Britten, 33, of Miami, Okla., formerly of Joplin, were charged in a two-count indictment returned by a federal grand jury in Springfield, Mo.
The federal indictment alleges that Ernest and Kendra Britten used a minor to produce child pornography from June 23, 2005, to July 2, 2012. The indictment also charges Ernest and Kendra Britten with receiving child pornography over the Internet from Dec. 27, 2010, to Nov. 10, 2011.
This case is being prosecuted by Assistant U.S. Attorney Ami Harshad Miller. It was investigated by the Southwest Missouri Cyber Crime Task Force and the Missouri State Highway Patrol.
USA v. Peterson
Michael Douglas Peterson, 32, of Morristown, Tenn., formerly of Barry County, Mo., was charged in a two-count indictment returned by a federal grand jury in Springfield, Mo. Today’s indictment replaces a federal criminal complaint that was filed against Peterson on Jan. 23, 2015.
The federal indictment alleges that Peterson used a minor victim to produce child pornography from March 1, 2014, to Jan. 21, 2015. Peterson is also charged with using his cell phone during that time to entice the minor, who was younger than 17, to engage in illicit sexual behavior.
According to an affidavit filed in support of the original criminal complaint, Peterson was exchanging nude photos via cell phone and engaging in sexual activity with the 15-year-old victim in Cassville, Mo. A state arrest warrant was issued for Peterson, but he could not be located.
The victim’s mother took her to live in Tennessee. Federal agents later located Peterson in Morristown, Tenn., where he was living with the child victim and her mother. Peterson was arrested and remains in federal custody.
Peterson told federal agents the child victim’s mother allowed him to move into their home and was aware that he and the child victim engaged in sexual intercourse. The child victim, the affidavit says, is pregnant with Peterson’s child. She was taken into protective custody and placed in foster care.
This case is being prosecuted by Assistant U.S. Attorney Ami Harshad Miller. It was investigated by the Southwest Missouri Cyber Crime Task Force, Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) and the FBI.
USA v. Hall
Michael Roger Hall, 19, of Kenton, Ohio, was charged in a two-count indictment returned by a federal grand jury in Springfield, Mo. Today’s indictment replaces a federal criminal complaint that was filed against Hall on Friday, Feb. 20, 2015.
The federal indictment alleges that Hall used a minor to produce child pornography from Dec. 7 to 9, 2014. The indictment also alleges that Hall communicated via the Internet to entice a minor victim to engage in illicit sexual behavior.
According to an affidavit filed in support of the original criminal complaint, Hall was exchanging nude images over the Internet with a 9-year-old victim in Ava, Mo. Hall and the child victim, who began communicating through an application on her Kindle Fire, allegedly discussed meeting for sexual contact.
A law enforcement officer, portraying the identity of the child victim, began communicating with Hall. Hall was arrested on Friday, Feb. 20, 2015, and remains in federal custody.
This case is being prosecuted by Assistant U.S. Attorney Ami Harshad Miller. It was investigated by the Ava, Mo., Police Department, the Southwest Missouri Cyber Crime Task Force and the FBI.
Dickinson cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Bookkeeper Sentenced to 18 Months in Federal Prison for Theft of $541,500 from Local Hunting and Fishing ClubRead the Press Release
Memphis, Tenn. – Edward L. Stanton III, U.S. Attorney for the Western District of Tennessee, announced today that Hazel Cathy Wadley, of Memphis, Tennessee, was sentenced this morning by U.S. District Judge John T. Fowlkes, Jr. to serve 18 months in federal prison in connection with a wire fraud scheme to defraud Menasha Hunting and Fishing Club of approximately $541,500. There is no parole in the federal prison system.
Wadley pled guilty in November, 2014, to a one-count criminal information charging her with wire fraud. According to the criminal information, Wadley was employed at Jim Keras Nissan and also performed bookkeeping duties for the Menasha Hunting and Fishing Club. At her guilty plea hearing Wadley admitted that between October 2007 and August 2013, she stole funds from Menasha by using funds in Menasha’s bank account at Suntrust Bank to make online payments of her personal debts and expenses.
In addition to the prison sentence, U.S. District Judge Fowlkes ordered Wadley to serve three years of supervised release and to pay restitution in the amount of $301,000 to Menasha Hunting and Fishing Club and $237,000 to Zurich Insurance Group (Menasha’s insurance company), for a total of $538,000.
This investigation was conducted by the United States Secret Service. Assistant U.S. Attorney Carroll L. Andre III represented the government.
Spanish Version
Arizona Executive Arrested in Foreign Currency Trading ScamRead the Press Release
BOSTON – An Arizona man was charged in an indictment unsealed today with defrauding numerous victims who invested in his foreign currency trading company.
David Prescott, 44, formerly of Boston, was charged with 16 counts of wire fraud. Prescott, who previously went by the name of David Weeks, was arrested today in Arizona.
According to the indictment, David Prescott was the owner and President of Cambridge Currency Partners, LLC (CCP), which was purportedly engaged in the business of buying and selling foreign currency. Prescott falsely represented to investors that their funds would be invested in CCP and used for business purposes, and that the investors would receive a monthly return. In fact, Prescott used the majority of the funds on personal expenses and repayments to other investors.
As part of the scheme, Prescott allegedly solicited investors by promising monthly returns ranging from one to six percent with little to no risk to the underlying principal. The indictment alleges that Prescott made false representations to the investors regarding the balances in their accounts and made payments to them that purported to be interest, but that, in fact, simply consisted of money from other investors. As a result, Prescott was allegedly able to secure multiple investments from the same investors. On one occasion, Prescott allegedly emailed an investor and promised to increase the interest paid on her previous investments if she were willing to invest additional funds, even though Prescott had already spent the majority of her previous investments on personal expenses and repayments to other investors.
The charging statute provides a maximum sentence of 20 years in prison, three years of supervised release, a fine of $250,000 or twice the gain or loss, and restitution. Actual sentences for federal crimes are typically less than the maximum penalties Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz and Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Alexander H. Berlin of Ortiz’s Economic Crimes Unit.
The details contained in the indictment are allegations. The defendant is presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.
Allentown Man Sentenced to Prison for Federal Cocaine TraffickingRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that Jose Torres, age 25, of Allentown, Lehigh County was sentenced today, in federal court in Scranton by Senior United States District Judge Edwin M. Kosik, to serve 78 months in prison on the charge of conspiracy to distribute cocaine.
According to United States Attorney Peter Smith, Torres previously pleaded guilty to distributing crack cocaine and powder cocaine in the Carbon County area between January 2011 and December 2012.
In addition to the prison term, Senior Judge Kosik also ordered that Torres be supervised by a probation officer for four years following his release from prison.
Torres was indicted by a federal grand jury on October 30, 2012, after an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Nesquehoning and Lansford Police Departments in Carbon County.
Torres is the seventh and final defendant to be sentenced in connection with the investigation. Previously, the following defendants, all from Carbon Country, were sentenced:
- Bonnie Vosburgh, age 22, of Nesquehoning, sentenced to 60 months in prison on the charge of
conspiracy to distribute cocaine;
- Victoria Ann Argott, age 34, of Lansford, sentenced to 40 months in prison on the charge of
conspiracy to distribute cocaine;
- Alexander “Butch” Sommers, age 37, of Summit Hill, sentenced to 37 months in prison on the
charge of aiding and abetting the distribution of cocaine;
- Jordan Bachert, age 29, of Lansford, sentenced to 30 months in prison on the charge of being an
unlawful user of controlled substances in possession of firearms;
- Joseph Revell, age 21, of Nesquehoning, sentenced to 30 months in prison on the charge of
distributing cocaine; and
- Ceres Lozada, age 27, of Nesquehoning, sentenced to 21 months in prison on the charge of
conspiracy to distribute cocaine.The cases were prosecuted by Assistant United States Attorney Robert J. O’Hara.
Wednesday 25 February 2015
Youngstown Man Charged with Identity TheftRead the Press Release
Aa federal grand returned a two-count indictment charging Ricardo Garcia-Baltazar, aka Richard Molina, 37, of Youngstown, with representing himself as a U.S. citizen when he is not and with aggravated identity theft, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Count 1 of the indictment alleges that on or about January 17, 2013, Garcia-Baltazar, a citizen of Mexico and an alien in the United States, falsely represented himself to be a citizen of the United States.
Count 2 of the indictment alleges that between on or about January 17, 2013 and March 8, 2013, Garcia-Baltazar transferred, possessed and used, without lawful authority, identification of another person, knowing that the identification belonged to another person.
If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
The investigation preceding the indictment was conducted by the Department of Homeland Security, U.S. Immigration and Customs Enforcement, Homeland Security Investigations. The matter is being prosecuted by Assistant United States Attorney Jason M. Katz.
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.
Woman Pleads Guilty to Bankruptcy Fraud, Bank FraudRead the Press Release
United States Attorney Kenyen R. Brown of the Southern District of Alabama announces today that Edwige Caroline Angono-Ndongo, 42, of Mobile, Alabama pleaded guilty to two federal fraud charges. Angono-Ndongo falsified the bankruptcy Schedules of Assets and Liabilities she filed in 2010 in her bankruptcy case in U.S. Bankruptcy Court for the Southern District of Alabama by failing to disclose some of her property, including bank and securities accounts. She also engaged in a credit card bankruptcy "bust out" scheme. Ndongo defrauded Bank of America with an electronic "check–kiting" scheme, using electronic transfers supported by insufficient funds, similar to "rubber checks", from her credit union to make it appear that she was making payments on her credit card accounts at the bank. By making bogus payments to the bank, she caused the bank to allow her to charge thousands of dollars in purchases. She then filed bankruptcy and discharged the debts to the bank. Angono-Ndongo faces a maximum penalty of 20 years in prison for the bankruptcy fraud charge and 30 years in prison for the bank fraud charge. Her sentencing is scheduled for June 8, 2015 before U.S. District Court Judge Callie V.S. Granade.
The case was investigated by the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorneys Charles Baer, Gregory Bordenkircher, and Sinan Kalayoglu. United States Attorney Kenyen R. Brown stated that the prosecution shows that the Department of Justice understands its duty to work to keep the bankruptcy system clean and to protect the banking system from fraud.
West Virginia couple sentenced for defrauding elderly victim to purchase beach houseRead the Press Release
WHEELING, WEST VIRGINIA – A Wetzel County couple was sentenced in federal court today after they stole nearly $400,000.00 from a 90-year-old victim to purchase a vacation home in the Outer Banks, United States Attorney William J. Ihlenfeld, II, announced.
In October 2014, a jury found Timothy Summers, 67, and Lea Ann Summers, 52, of Proctor, West Virginia, guilty of one count of “Conspiracy to Commit Mail Fraud” and one count of “Securities Fraud.” The jury further found Lea Ann Summers guilty of four counts of “Mail Fraud.” The jury further found Timothy Summers guilty of one count of “Interstate Transportation of Stolen Property.” Timothy and Lea Ann Summers were each sentenced today to 24 months in prison.
Evidence presented at trial showed that the couple collaborated to liquidate a significant portion of the victim’s investment holdings in PPG Industries stock. In late 2013, Lea Ann Summers called the stock holding company, Computershare, impersonating the victim, and sold 2,175 shares of PPG Industries stock.
Mrs. Summers then arranged for the proceeds of the sale, approximately $397,030.15, to be sent to herself rather than the victim. Timothy Summers deposited the proceeds and transferred the money into a bank account which he shared only with his wife. The couple then travelled to North Carolina and purchased a beach house in the Outer Banks for $243,173.61. As part of today’s sentence, the couple was also ordered to pay restitution in the amount of $397,030.15.
Assistant U.S. Attorneys David Perri and Michael Stein prosecuted the case on behalf of the government. The Federal Bureau of Investigation led the investigation.
Chief U.S. District Judge John Preston Bailey presided.
United States Recovers One Million Dollars in Connection with False Claims Act Allegations Relating to Skilled Therapy Services and Durable Medical EquipmentRead the Press Release
GRAND RAPIDS, MICHIGAN – U.S. Attorney Patrick Miles announced today that Agility Health, LLC (“Agility Health”) and Oceana County Medical Care Facility (“OCMCF”) have entered into agreements to pay the federal government a total of $1,000,000 to resolve allegations that they submitted false claims to Medicare, or caused false claims to be submitted to Medicare, in violation of the federal False Claims Act. Agility Health, a Grand Rapids-based company that manages or provides health care services at inpatient and outpatient sites in twenty states, will pay a settlement amount of $850,000. OCMCF, a county-owned facility that provides inpatient and outpatient rehabilitation services in Hart, Michigan, will pay a settlement amount of $150,000. Neither Agility Health nor OCMCF admitted liability as part of their settlements.
Beginning in 2008, Agility Health managed OCMCF’s therapy department, provided therapy staffing services at OCMCF, and assisted OCMCF in preparing insurance claims for therapy services. The settlements announced today resolve allegations that between January 1, 2009 and December 31, 2013, Agility Health knowingly caused false claims to be submitted to Medicare, and OCMCF knowingly submitted false claims to Medicare, for inpatient skilled therapy services that were not provided, that were upcoded, and that were medically unnecessary. According to the United States, Agility Health and OCMCF billed Medicare or caused Medicare to be billed for, among other things, services that were purportedly rendered to patients who were mentally and physically unable to participate in therapy programs.
The settlement with Agility Health also resolves allegations that during its tenure at OCMCF, Agility Health caused false claims for durable medical equipment to be submitted to Medicare. According to the United States, an Agility Health employee at OCMCF improperly disclosed protected health information to an outside vendor in 2011 in violation of the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”). The vendor used that information to bill Medicare for unnecessary medical equipment that some patients never received.
This case resulted from a civil lawsuit filed by three whistleblowers who worked at OCMCF. The lawsuit, known as a qui tam action, was filed under the False Claims Act, which allows private whistleblowers to bring lawsuits on behalf of the United States and receive a share of any recoveries. In this case, the Government intervened in the whistleblowers’ lawsuit. The whistleblowers will collectively receive over $200,000 of the settlement proceeds, as well as additional amounts for attorney’s fees and costs. The qui tam case is docketed as United States, et al., ex rel. Jahn, et al. v. Agility Health, Inc., et al., No. 1:12-cv-449 (W.D. Mich.).
“Patients in skilled nursing facilities should receive therapy based on their clinical needs, not the financial incentives of the companies and facilities that provide their care,” said U.S. Attorney Miles. “Patients also trust providers to protect their sensitive personal information as required by law. My office will use all available options to hold providers accountable when they improperly disclose protected health information.”
This case was investigated by the U.S. Attorney’s Office for the Western District of Michigan. Assistant U.S. Attorney Adam B. Townshend represented the United States.
END
Uniontown Man Indicted on Child Pornography Production and Possession ChargesRead the Press Release
PITTSBURGH - A resident of Fayette County has been indicted by a federal grand jury in Pittsburgh on charges of production and possession of material depicting the sexual exploitation of a minor, United States Attorney David J. Hickton announced today.
The four-count indictment named David Kinteay Carson, 37, as the sole defendant.
According to the indictment, on or about Sept. 26, 2014, Oct. 18, 2014, and Dec. 13, 2014, Carson produced visual depictions of the sexual exploitation of two minors. The indictment further alleges that on or about Dec. 18, 2014, Carson knowingly possessed images in computer graphic or digital files, the production of which involved the use of minors engaging in sexually explicit conduct.
The law provides for a mandatory minimum of 15 years imprisonment for each count of production of child pornography, a maximum sentence of 10 years imprisonment for possessing child pornography, and a fine of $750,000. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Jessica Lieber Smolar is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation and the Uniontown City Police Department conducted the investigation leading to the Indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
U.S. Magistrate Judge Orders Colorado Springs Bombing Suspect to Be Held Without BondRead the Press Release
DENVER – U.S. Magistrate Judge Michael J. Watanabe today ordered Thaddeus Cheyenne Murphy, age 44, of Colorado Springs, Colorado, to be held in custody without bond pending a resolution of his case. The U.S. Magistrate Judge ordered Murphy to be held because he was deemed both a danger to the community and a risk of flight. The U.S. District Court will next schedule a serious of hearing dates, that should be available later in the week.
Two Men Plead Guilty to Offenses Involving the Theft, Sale, and Interstate Transportation of Semi-Conductor Grade Polysilicon from A Local PlantRead the Press Release
Kenyen R. Brown, United States Attorney for the Southern District of Alabama announced that Willie Richard Short, age 62, a resident of Loxley, Alabama, and George J. Welford, age 61, a resident of Gautier, Mississippi, entered guilty pleas today before United States District Judge Kristi K. Dubose to two federal offenses: conspiracy to transport stolen goods in interstate and foreign commerce, and conspiracy to launder the proceeds from the sale of the stolen polysilicon.
Short and Welford admitted in open court that in early-2009 they began stealing high-purity, semi-conductor grade polysilicon from their employer, a manufacturing plant located in Theodore, Alabama, and continued doing so until January 2014. Short and Welford hid the stolen polysilicon in their lunch boxes, back packs, and lockers, and transported the stolen goods in their personal vehicles.
Short and Welford searched the internet for a buyer for the stolen goods, and used the fake names "William Smith" and "Butch Cassidy" to communicate with the buyer. Short and Welford agreed to sell the stolen polysilicon to this buyer on the condition that all payments for the loads of polysilicon had to be made in cash and in person. The rendezvous sites for the
delivery of the cash payments were located in Mobile, Alabama, Pensacola, Florida, Shreveport, Louisiana, and elsewhere.
Short admitted that he conspired to steal, sell, and transport in interstate commerce at least 42,000 kilograms (42 metric tons) of polysilicon, and Welford admitted that he conspired to steal, sell, and transport in interstate commerce at least 29,000 kilograms (29 metric tons) of polysilicon. The total amount of stolen polysilicon had a market value of approximately $2.6 million.
This case was investigated by the Department of Homeland Security and the Criminal Investigation Division of the Internal Revenue Service, and is being prosecuted by Donna B. Dobbins and Christopher J. Bodnar, Assistant United States Attorneys in the United States Attorney=s Office for the Southern District of Alabama.
Two Connecticut Men Plead Guilty to Defrauding EmployersRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that JASON TORRANCE, 43, of East Haddam, and ADAM MEYERS, 43, of Southbury, pleaded guilty on February 23 in Bridgeport federal court to engaging in a fraud scheme against their respective employers.
According to court documents and statements made in court, between approximately March 2008 and August 2012, TORRANCE and MEYERS devised a scheme to defraud their employers by arranging for payment on goods that never shipped and instead diverting those payments to themselves. TORRANCE worked out of the New Haven branch of a New Jersey-based electrical and industrial supply company (“Distributor-1”), and MEYERS was a project manager for a New Britain-based electrical subcontractor (“Contractor”) that frequently purchased supplies from Distributor-1. A co-conspirator (“CC-2”) operated a smaller distributor (“Distributor-2”) based in Cheshire.
As part of the scheme, MEYERS identified to TORRANCE projects on which he believed the profit margin for Contractor would permit them to divert excess profits to themselves without Contractor becoming aware. MEYERS would submit a purchase order for materials to TORRANCE. TORRANCE then submitted a purchase order to CC-2 for the goods listed on the purchase order sent by MEYERS. CC-2 then submitted an invoice to Distributor-1 for the materials listed on the purchase order, and Distributor-1 paid the invoice by mailing a check to Distributor-2. Distributor-1 then invoiced Contractor for the goods that were on the purchase order and Contractor issued a check to Distributor-1. CC-2 then hand-delivered a business check to TORRANCE for approximately 90 percent of the money that had been paid by Distributor-1 to Distributor-2, and CC-2 retained the remaining 10 percent as his share of the proceeds from the scheme. TORRANCE then paid out a portion of the proceeds of the scheme to MEYERS.
At no time did any product on the purchase orders actually ship to the customer.
The victim companies lost more than $600,000 as a result of this scheme.
TORRANCE and MEYERS each pleaded guilty to one count of conspiracy to commit mail fraud, which carries a maximum term of imprisonment of 20 years. They are scheduled to be sentenced by U.S. District Judge Stefan R. Underhill on May 18, 2015.
This matter is being investigated by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney David E. Novick.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Tulsa Man Sentenced to over 17 Years in Prison for Distributing Child PornographyRead the Press Release
TULSA, Okla.—Kenneth R. Morain, 63, of Tulsa, was sentenced by United States District Court Judge James H. Payne to 210 months in prison, to be followed by lifetime supervised release, for possessing, receiving, and distributing more than 33,000 image and video files of child pornography, announced United States Attorney Danny C. Williams Sr., for the Northern District of Oklahoma. Morain was also ordered to pay $33,000 in restitution to the victims. He was charged by a grand jury on February 3, 2014, and he pleaded guilty on July 17, 2014.
“Exploiting and abusing the most vulnerable in our community is a heinous crime,” said U.S. Attorney Williams. “We will work with our law enforcement partners to track down those who exploit and abuse children and prosecute those criminals to the fullest extent of the law. The defendant will now face the consequences of his crimes behind bars.”
Morain used free Wi-Fi internet services at various businesses across Tulsa to access and share child pornography via the Peer-to-Peer (P2P) file sharing network called ARES. He would view and download child pornography while seated in his vehicle parked in a business’s parking lot. During the investigation more than 33,000 images and video files of child pornography were discovered on Morain’s seized computer and removable flash drives.
The case was a joint investigation by the FBI and the Tulsa Police Department; prosecution was handled by Assistant United States Attorney Jeffrey A. Gallant.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
(U.S. vs. Kenneth R. Morain)
Trivillian's Pharmacy, owner plead guilty to federal health care and drug crimesRead the Press Release
CHARLESTON, W.Va. – United States Attorney Booth Goodwin announced today that Paula Butterfield, owner and pharmacist-in-charge of Trivillian’s Pharmacy, a long-standing Kanawha City retail and compounding pharmacy, pleaded guilty to making a false statement in a healthcare matter. Butterfield also pleaded guilty on behalf of Trivillian’s to one count of health care fraud and one count of misbranding drugs.
Butterfield admitted that Trivillian’s defrauded Medicare and Medicaid by dispensing less expensive compounded drugs while billing for more expensive brand name drugs, dispensing generic drugs while billing for more expensive brand name drugs, billing for drugs that were never dispensed or were expired and dispensing drugs that were compounded outside of a safe and clean environment. The pharmacy also admitted to dispensing compounded drugs under labels and identification numbers associated with brand name drugs.
Butterfield, a Medicare beneficiary, pleaded guilty to submitting false information claims to Medicare on her own behalf, seeking payment for drugs that were never dispensed to her.
Trivillian’s faces a fine of up to $1 million or twice the gross financial gain or twice the gross financial loss resulting from the pharmacy’s conduct, whichever is greater; not less than two years nor more than 10 years of probation; a mandatory special assessment of $800; and an order of restitution.
Butterfield faces up to five years in federal prison; a fine of $250,000, or twice the gross financial gain or twice the gross financial loss resulting from her conduct, whichever is greater; three years of supervised release; a mandatory special assessment of $100; and an order of restitution.
Trivillian’s and Butterfield are scheduled to be sentenced on May 28, 2015.
Goodwin also announced that his office reached a civil settlement with Trivillian’s and Butterfield, recovering $1.1. million on behalf of Medicare and West Virginia Medicaid. The settlement represents more than three times the loss suffered by Medicare and Medicaid.
“Cheating Medicare and Medicaid is really cheating the American taxpayer,” Goodwin said. “Thanks to these prosecutions and this settlement, money that was taken from the taxpayers by fraud can now be used to provide health care to the many people who depend on these programs.”
The investigation is being conducted by United States Health and Human Services, the United States Food and Drug Administration Office of Criminal Investigation, West Virginia State Police, West Virginia Medicaid Fraud Control Unit and Drug Enforcement Administration. Assistant United States Attorney Eumi Choi is handling the prosecution.
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Towson Man Sentenced to 42 Months in Prison for Possessing Child PornographyRead the Press Release
Baltimore, Maryland – U.S. District Judge William D. Quarles, Jr. sentenced Nicholas Haxall Johnson, age 24, of Towson, Maryland, today to 42 months in prison followed by 20 years of supervised release for possessing child pornography. Judge Quarles ordered that upon his release from prison, Johnson must register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Chief James W. Johnson of the Baltimore County Police Department; Special Agent in Charge William Winter of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); and Baltimore County State’s Attorney Scott Shellenberger.
According to his plea agreement, in September 2013, a Baltimore County Police detective who was using a computer observed that Johnson had files containing child pornography available for download on the internet. The investigator downloaded approximately 150 image files, many of which contained child pornography.
On October 4, 2013, law enforcement officers executed a search warrant at Johnson’s residence. They seized Johnson’s laptop and external hard drive which contained more than 250,000 images, the majority of which depicted minors engaged in sexually explicit conduct. Hundreds of prescription pills, including Adderall and Ritalin pills, were recovered from a safe, along with a glass pipe, plastic baggies, drugs and three grinders.
Further investigation of Johnson’s computer revealed that he created an online persona of a 15-year old male which he used to communicate with 13 and 14-year old girls. Johnson discussed sexual topics with the young girls and encouraged them to send him nude photos of themselves.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc. For more information about internet safety education, please visit www.justice.gov/psc and click on the "resources" tab on the left of the page.
United States Attorney Rod J. Rosenstein commended the FBI, HSI Baltimore, Baltimore County Police Department and Baltimore County State’s Attorney’s Office for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Paul E. Budlow, who prosecuted the case.
Three convicted of oxycodone traffickingRead the Press Release
CLARKSBURG, WEST VIRGINIA – Timothy Charles Burnette, 45, Erik Jones, 27, both of Morgantown, West Virginia, and Terri Shuttlesworth, 24, of Fairmont, West Virginia were convicted in federal court today for their role in a Pennsylvania to West Virginia prescription painkiller distribution operation, United States Attorney William J. Ihlenfeld, II, announced.
An investigation by the West Virginia State Police Bureau of Criminal Investigation revealed that each of the three defendants participated in a drug distribution operation in which prescription painkillers were transported across state lines from Philadelphia, Pennsylvania to Morgantown, West Virginia for redistribution and sale.
Jones and Shuttlesworth admitted that they sold oxycodone in Monongalia County, West Virginia in late 2013 and early 2014. They each pled guilty today to one count of “Distribution of Oxycodone.” They each face up to 20 years in prison and a fine of up to $1,000,000.00.
Burnette admitted that in June 2014, he utilized a telephone system to make arrangements to purchase a quantity of oxycodone pills. He pled guilty today to one count of “Use of a Telephone to Facilitate the Distribution of Oxycodone.” He faces up to four years in prison and a fine of up to $250,000.00.
Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendants.
Assistant U.S. Attorney Zelda Wesley is prosecuting the case on behalf of the government.
U.S. Magistrate Judge John S. Kaull presided.Three Brooklyn, New York, Residents Charged with Attempt and Conspiracy to Provide Material Support to ISILRead the Press Release
Two Defendants Allegedly Planned to Travel to Syria in Order to Join ISIL;
One Defendant Arrested While Boarding a Flight to Turkey
Earlier today, a criminal complaint was unsealed in federal court in Brooklyn charging Abdurasul Hasanovich Juraboev, Akhror Saidakhmetov, and Abror Habibov with attempt and conspiracy to provide material support to the Islamic State of Iraq and the Levant (ISIL), a foreign terrorist organization. The initial appearances of Juraboev and Saidakhmetov are scheduled for later today before United States Magistrate Judge Lois Bloom at the U.S. Courthouse, 225 Cadman Plaza East, Brooklyn, New York. Habibov’s initial appearance will be held later today at the U.S. Courthouse, 300 North Hogan Street, Jacksonville, Florida.
The charges were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York; John P. Carlin, Assistant Attorney General for National Security; Diego G. Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation (FBI), New York Field Office; and William J. Bratton, Commissioner, New York City Police Department (NYPD).
As alleged in the complaint, Juraboev first came to the attention of law enforcement in August 2014 after he made a posting on an Uzbek-language website that propagates ISIL’s ideology. The investigation subsequently revealed that Juraboev and Saidakhmetov devised a plan to travel to Turkey and then to Syria for the purpose of waging jihad on behalf of ISIL. Saidakhmetov, a resident of Brooklyn and a citizen of Kazakhstan, was arrested early this morning at John F. Kennedy International Airport, where he was attempting to board a flight to Istanbul, Turkey. Juraboev, a resident of Brooklyn and a citizen of Uzbekistan, had previously purchased a plane ticket to travel from New York to Istanbul and was scheduled to leave the United States next month. Habibov, a resident of Brooklyn and a citizen of Uzbekistan, helped fund Saidakhmetov’s efforts to join ISIL.
As alleged in the complaint, Juraboev was also prepared to engage in an act of terrorism in the United States if ordered to do so by ISIL, and Saidakhmetov intended to commit such an act if unable to travel abroad to join ISIL. In the August 2014 posting on the website that propagates ISIL’s ideology, Juraboev offered to kill the President of the United States if ordered to do so by ISIL. More recently, Saidakhmetov expressed his intent to buy a machine gun and shoot police officers and FBI agents if thwarted in his plan to join ISIL in Syria.
“The flow of foreign fighters to Syria represents an evolving threat to our country and to our allies,” stated United States Attorney Lynch. “As alleged in the complaint, two of the defendants in this case sought to travel to Syria to join ISIL but were also prepared to wage violent jihad here in the United States. A third defendant allegedly provided financial assistance and encouragement. We will vigorously prosecute those who attempt to travel to Syria to wage violent jihad on behalf of ISIL and those who support them. Anyone who threatens our citizens and our allies, here or abroad, will face the full force of American justice.” Ms. Lynch extended her grateful appreciation to the FBI’s Joint Terrorism Task Force, which comprises a large number of federal, state, and local agencies from the region.
“The charges against Juraboev, Saidakhmetov and Habibov reflect our commitment to finding those who wish to provide material support to ISIL, as well as those committed to fighting on behalf of ISIL, either at home or abroad, and preventing them from doing so,” said Assistant Attorney General Carlin. “The National Security Division will continue to work to stem the flow of foreign fighters and financial resources to terrorist organizations operating in Iraq and Syria. I would like to commend all those whose tireless efforts helped bring these charges.”
“As alleged, the defendants looked to join the Islamic State of Iraq and the Levant by flying to Turkey in a vain attempt to evade detection. And one of the defendants was prepared to commit acts of terror here—in America—if he could not travel, to include killing FBI agents. The defendants violated the true tenets of their faith in pursuit of their radical, violent agenda. We rely on help from the community, the public, and religious leaders to be mindful of those who could be radicalized. We cannot do this alone,” said FBI Assistant Director-in-Charge Rodriguez.
“ISIL calls on its followers to come fight for the terrorist organization in Syria,” said Police Commissioner Bratton, “and in messages to followers outside Syria, ISIL has called on them to attack police, intelligence officers, or the military in their home countries including the United States. By pledging allegiance to ISIL, these defendants allegedly conspired to fight for a designated foreign terrorist organization, either in Syria or even New York.” Commissioner Bratton commended the work of the detectives and agents of the JTTF and the guidance of the U.S. Attorney for the Eastern District of New York throughout the investigation.
If convicted, each defendant faces a maximum sentence of 15 years in prison. The charges in the complaint are merely allegations, and the defendants are presumed innocent unless and until proven guilty.
The government’s case is being prosecuted by Assistant United States Attorneys Alexander Solomon, Douglas M. Pravda, and Amanda Hector, with assistance provided by Trial Attorney Danya Atiyeh of the Justice Department’s Counterterrorism Section and the United States Attorney’s Office for the Middle District of Florida.
The Defendants:
ABDURASUL HASANOVICH JURABOEV
Age: 24
Nationality: Uzbeki
AKHROR SAIDAKHMETOV
Age: 19
Nationality: Kazakh
ABROR HABIBOV
Age: 30
Nationality: Uzbeki
E.D.N.Y. Docket No. 15-M-0172
Three Brooklyn Residents Charged with Attempt and Conspiracy to Provide Material Support to ISILRead the Press Release
Earlier today, a criminal complaint was unsealed in federal court in Brooklyn charging Abdurasul Hasanovich Juraboev, Akhror Saidakhmetov, and Abror Habibov with attempt and conspiracy to provide material support to the Islamic State of Iraq and the Levant (ISIL), a foreign terrorist organization. The initial appearances of Juraboev and Saidakhmetov are scheduled for later today before United States Magistrate Judge Lois Bloom at the U.S. Courthouse, 225 Cadman Plaza East, Brooklyn, New York. Habibov’s initial appearance will be held later today at the U.S. Courthouse, 300 North Hogan Street, Jacksonville, Florida.
The charges were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York; John P. Carlin, Assistant Attorney General for National Security; Diego G. Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation (FBI), New York Field Office; and William J. Bratton, Commissioner, New York City Police Department (NYPD).
As alleged in the complaint, Juraboev first came to the attention of law enforcement in August 2014 after he made a posting on an Uzbek-language website that propagates ISIL’s ideology. The investigation subsequently revealed that Juraboev and Saidakhmetov devised a plan to travel to Turkey and then to Syria for the purpose of waging jihad on behalf of ISIL. Saidakhmetov, a resident of Brooklyn and a citizen of Kazakhstan, was arrested early this morning at John F. Kennedy International Airport, where he was attempting to board a flight to Istanbul, Turkey. Juraboev, a resident of Brooklyn and a citizen of Uzbekistan, had previously purchased a plane ticket to travel from New York to Istanbul and was scheduled to leave the United States next month. Habibov, a resident of Brooklyn and a citizen of Uzbekistan, helped fund Saidakhmetov’s efforts to join ISIL.
As alleged in the complaint, Juraboev was also prepared to engage in an act of terrorism in the United States if ordered to do so by ISIL, and Saidakhmetov intended to commit such an act if unable to travel abroad to join ISIL. In the August 2014 posting on the website that propagates ISIL’s ideology, Juraboev offered to kill the President of the United States if ordered to do so by ISIL. More recently, Saidakhmetov expressed his intent to buy a machine gun and shoot police officers and FBI agents if thwarted in his plan to join ISIL in Syria.
“The flow of foreign fighters to Syria represents an evolving threat to our country and to our allies,” stated United States Attorney Lynch. “As alleged in the complaint, two of the defendants in this case sought to travel to Syria to join ISIL but were also prepared to wage violent jihad here in the United States. A third defendant allegedly provided financial assistance and encouragement. We will vigorously prosecute those who attempt to travel to Syria to wage violent jihad on behalf of ISIL and those who support them. Anyone who threatens our citizens and our allies, here or abroad, will face the full force of American justice.” Ms. Lynch extended her grateful appreciation to the FBI’s Joint Terrorism Task Force, which comprises a large number of federal, state, and local agencies from the region.
“The charges against Juraboev, Saidakhmetov and Habibov reflect our commitment to finding those who wish to provide material support to ISIL, as well as those committed to fighting on behalf of ISIL, either at home or abroad, and preventing them from doing so,” said Assistant Attorney General Carlin. “The National Security Division will continue to work to stem the flow of foreign fighters and financial resources to terrorist organizations operating in Iraq and Syria. I would like to commend all those whose tireless efforts helped bring these charges.”
“As alleged, the defendants looked to join the Islamic State of Iraq and the Levant by flying to Turkey in a vain attempt to evade detection. And one of the defendants was prepared to commit acts of terror here—in America—if he could not travel, to include killing FBI agents. The defendants violated the true tenants of their faith in pursuit of their radical, violent agenda. We rely on help from the community, the public, and religious leaders to be mindful of those who could be radicalized. We cannot do this alone,” said FBI Assistant Director-in-Charge Rodriguez.
“ISIL calls on its followers to come fight for the terrorist organization in Syria,” said Police Commissioner Bratton, “and in messages to followers outside Syria, ISIL has called on them to attack police, intelligence officers, or the military in their home countries including the United States. By pledging allegiance to ISIL, these defendants allegedly conspired to fight for a designated foreign terrorist organization, either in Syria or even New York.” Commissioner Bratton commended the work of the detectives and agents of the JTTF and the guidance of the U.S. Attorney for the Eastern District of New York throughout the investigation.
If convicted, each defendant faces a maximum sentence of 15 years in prison. The charges in the complaint are merely allegations, and the defendants are presumed innocent unless and until proven guilty.
The government’s case is being prosecuted by Assistant United States Attorneys Alexander Solomon, Douglas M. Pravda, and Amanda Hector, with assistance provided by Trial Attorney Danya Atiyeh of the Justice Department’s Counterterrorism Section and the United States Attorney’s Office for the Middle District of Florida.
The Defendants:
ABDURASUL HASANOVICH JURABOEV
Age: 24
Nationality: Uzbeki
AKHROR SAIDAKHMETOV
Age: 19
Nationality: Kazakh
ABROR HABIBOV
Age: 30
Nationality: Uzbeki
E.D.N.Y. Docket No. 15-M-0172
Three Brandon, Mississippi, Men Sentenced for Their Roles in the Racially Motivated Assault and Murder of an African-American ManRead the Press Release
Victim Died After Being Run Over by Truck
The Justice Department announced today that William Kirk Montgomery, 25, of Puckett, Mississippi, Jonathan Kyle Gaskamp, 22, and Joseph Paul Dominick, 23, both of Brandon, Mississippi, were sentenced today in U.S. District Court in Jackson for their roles in a federal hate crime conspiracy involving multiple racially motivated assaults, culminating in the death of James Craig Anderson, an African-American man, in the summer of 2011. Montgomery was sentenced to 234 months; Gaskamp was sentenced to 48 months; and Dominick was sentenced to 48 months.
Montgomery had previously pleaded guilty to one count of conspiracy and one count of violating the Matthew Shepard and James Byrd Jr. Hate Crimes Prevention Act for his role in the death-resulting assault of Anderson, 47, of Jackson, Mississippi. Gaskamp previously pleaded guilty to one count of conspiracy and one count of violating the Matthew Shepard and James Byrd, Jr. Hate Crimes Prevention Act for his role in the conspiracy and in a violent assault of an unidentified African-American man near a golf course in the spring of 2011. Dominick pleaded guilty to one count of conspiracy for his role. A restitution hearing will be set for a later date.
“The Justice Department will always fight to hold accountable those who commit racially motivated assaults,” said Acting Assistant Attorney General Vanita Gupta of the Civil Rights Division. “We hope that the prosecution of those responsible for this horrific crime will help provide some closure to the victim’s family and to the larger community affected by this heinous crime.”
“Violence fueled by hate spreads fear and intimidation throughout our community,” said U.S. Attorney Gregory K. Davis of the Southern District of Mississippi. “The prison sentences today make clear that our community will not tolerate hate, and individuals who commit such despicable crimes will be brought to justice.”
“The guilty pleas and resulting sentences handed down today are the result of the tremendous efforts by men and women in law enforcement who worked on this case,” said Special Agent in Charge Donald Alway of the FBI in Mississippi. “The FBI takes very seriously its responsibility to protect the civil rights of all Americans, and remains committed to its pursuit of justice for anyone who is deprived of those rights."
In prior court hearings, the defendants had admitted that beginning in the spring of 2011, they and others conspired with one another to harass and assault African Americans in and around Jackson. On numerous occasions, the co-conspirators used dangerous weapons, including beer bottles, sling shots and motor vehicles, to cause, and attempt to cause, bodily injury to African Americans. They would specifically target African Americans they believed to be homeless or under the influence of alcohol because they believed that such individuals would be less likely to report an assault. The co-conspirators would often boast about these racially motivated assaults.
Montgomery admitted his presence and participation in numerous racially motivated assaults, including the beating and killing of James Craig Anderson. Specifically, Montgomery admitted that in the early morning hours of June 26, 2011, he and six other co-conspirators agreed to carry out their plan to find, harass and assault African Americans. At around 4:15 a.m., Montgomery and three co-conspirators drove to west Jackson in Montgomery’s white Jeep with the understanding that the other three co-conspirators would join them a short time later. Montgomery and the three other occupants of the Jeep then drove around west Jackson and threw beer bottles from the moving vehicle at African-American pedestrians they encountered.
At approximately 5:00 a.m., Montgomery and the three other two occupants of the Jeep spotted Anderson in a motel parking lot off Ellis Avenue. The occupants of the Jeep decided that Anderson would be a good target for an assault because he was African-American and appeared to be intoxicated. Two of the co-conspirators got out of the Jeep to distract Anderson while they waited for the other three co-conspirators to arrive. After the other three co-conspirators arrived in a Ford F250 truck, two of the co-conspirators physically assaulted Anderson. After the assault, Montgomery and three co-conspirators left the motel parking lot in the Jeep. The driver of the Ford F250 then deliberately used his truck to run over Anderson, causing injuries which resulted in Anderson’s death. After Anderson’s death, a number of the co-conspirators including Montgomery agreed to, and did, give false statements to law enforcement officials about the nature of their interactions with Anderson.
Gaskamp admitted to participating in an assault-filled evening during which he and five co-conspirators drove to Jackson armed with Gaskamp’s handgun, struck multiple victims with large glass beer bottles hurled from the moving vehicle. Gaskamp further admitted that they located a homeless African-American man near a golf course and that he and two of his co-defendants punched and kicked the man until he begged for his life. Dominick admitted to participating in different assault-filled evening during which he and four co-conspirators also struck multiple victims with large glass beer bottles thrown from their moving vehicle, and to shooting multiple victims with metal ball bearings fired from a slingshot.
Three other defendants in related cases, Deryl Paul Dedmon, 22, John Aaron Rice, 22, and Dylan Wade Butler, 23, all of Brandon, Mississippi, were previously sentenced to 600 months, 220 months, and 78 months, respectively for their roles in the conspiracy. Four other defendants involved in related cases, Sarah Adelia Graves, 21, of Crystal Springs, Mississippi, Shelby Brooke Richards, 21, of Pearl, Mississippi, John Louis Blalack, 20, and Robert Henry Rice, 24, both of Brandon, Mississippi, are awaiting sentencing.
This case was the result of a cooperative effort among the Justice Department’s Civil Rights Division, the U.S. Attorney’s Office for the Southern District of Mississippi and the Hinds County, Mississippi, District Attorney’s Office. This case was investigated by the Jackson Division of the FBI and the Jackson Police Department. It is being prosecuted by Trial Attorney Sheldon L. Beer and Deputy Chief Paige M. Fitzgerald of the Justice Department’s Civil Rights Division, and Glenda R. Haynes of the U.S. Attorney’s Office for the Southern District of Mississippi.
Ten Individuals Indicted in Stolen Identity Tax Refund SchemeRead the Press Release
GREENVILLE, Tenn. – Ten individuals were indicted on Feb. 10, 2015, for conspiracy to commit wire fraud, theft of public money and money laundering conspiracy, in a 10-count indictment handed down by a federal grand jury in Greenville, Tenn. Those indicted include:
Eugene Carl Kotelman, 39, of Burtchville, Mich.; Jamie Marie Lowery, 38, of Port Huron, Mich.; Brian Keith Elliott, 49, of Greenville, Tenn.; Bernard Erwin Goewey, 47, of Afton, Tenn.; Michelle Goewey, 44, of Afton, Tenn.; Timothy Ray Groh, 46, of Port Huron, Mich.; Jake Marshall McKelvey, 53, of Atlanta, Mich.; Gerald Kenneth Orshal, III, 56, of Crystal River, Fla.; Amy Rose Peters Thompson, 33, Port Huron, Mich.; and Terri Lynn Worley, 52, of Port Huron, Mich.
The indictment on file with the U.S. District Court alleges that between January 2008 and December 2012, these individuals conspired to obtain money from the Internal Revenue Service (IRS) by submitting fraudulent federal income tax returns that claimed false federal income tax refunds. As part of the scheme, they submitted, or caused to be submitted, a total of 150 federal income tax returns claiming false tax refunds of $1.2 million. The false returns were filed using stolen Personal Identification Information (PII) that was used without the individual’s authorization.
Eugene Kotelman is currently incarcerated with the Michigan Department of Corrections.
On Feb. 25, 2015, Jamie Lowery and Jake McKelvey were arrested in Charlotte, N.C.; Amy Peterson, Timothy Groh and Teri Worley were arrested in Detroit, Mich.; Gerald Orshal was arrested in Tampa, Fla.; and Brian Elliott, Michelle Goewey and Bernard Goewey were arrested in Greeneville, Tenn. They appeared in U.S. District Court before U.S. Magistrate Judge Dennis H. Inman in Greenville, Tenn., on Feb. 25, 2015.
The case was investigated by Special Agents with the IRS–Criminal Investigation. Assistant U.S. Attorney Helen Smith represents the United States.
Members of the public are reminded that an indictment constitutes only charges and that every person is presumed innocent until their guilt has been proven beyond a reasonable doubt.
Tangible Software, Inc. Agrees to Resolve False Claims Act AllegationsRead the Press Release
Baltimore, Maryland - Department of Defense contractor Tangible Software, Inc., owned and operated by Energy Management and Security Solutions, LLC since 2011, has agreed to pay the United States between $500,000 and $1.05 million to resolve allegations under the False Claims Act that the company submitted false claims to the Department of Defense under prior ownership from 2008 to 2011.
The settlement was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Robert Craig of the Defense Criminal Investigative Service (DCIS) - Mid-Atlantic Field Office; Acting Inspector General Jim Gribble of the Defense Information Systems Agency (DISA); and General Services Administration (GSA) Deputy Inspector General Robert C. Erickson.
This settlement resolves allegations that Tangible Software submitted claims for reimbursement of costs associated with contracts with the GSA and Defense Information Systems Agency involving information technology support and services, knowing that the requested reimbursements of costs exceeded what Tangible Software actually paid for the services. There has been no judicial finding of liability and Tangible Software denies liability.
“Defense contractors are required to bill for costs actually incurred, and to be truthful in the claims they submit to federal agencies," said United States Attorney for the District of Maryland Rod J. Rosenstein.
“This Tangible Software case is a prime example of how DISA IG works to detect and prevent fraud schemes within the Agency and recuperate funds for the U.S. government,” said DISA Acting Inspector General, Jim Gribble.
“GSA contracts need to be executed in the best interest of American taxpayers,” said GSA Deputy Inspector General Robert C. Erickson.
As part of the settlement, Tangible Software has agreed to make additional payments above a minimum settlement payment of $500,000, depending on the financial performance of the company over the next five years and the outcome of a shareholder lawsuit Tangible Software has initiated against its prior management that oversaw the period of misconduct. The investigation was aided by the new ownership disclosing alleged misconduct by the prior ownership.
The civil settlement resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and obtain a portion of the government's recovery. The civil lawsuit was filed in the District of Maryland and is captioned United States ex rel. Michael Bradle v. Tangible Software, Inc. As part of today’s resolution, Mr. Bradle will receive a minimum of $80,000 from the settlement.
The settlement was a result of an investigation by the U.S. Attorney's Office for the District of Maryland, DCIS, Defense Information Systems Agency - Inspector General's Office, and GSA - Inspector General's Office. Mr. Rosenstein commended the Defense Contract Audit Agency for their assistance in the investigation. The investigation was handled by Assistant U.S. Attorney Thomas Barnard.
Tallahassee Man Pleads Guilty to Production of Child PornographyRead the Press Release
TALLAHASSEE, FLORIDA – Jonathan Harry Lee Williams of Tallahassee, Florida, pled guilty today to using a minor to produce child pornography and to possessing child pornography. The plea was announced by Pamela C. Marsh, United States Attorney for the Northern District of Florida.
Williams, the former registrar at Ruediger Elementary School, was arrested on December 11, 2014, after FBI agents executed a search warrant at his home. During the search, law enforcement seized Williams’s smart phones, which contained child pornography.
Today in court, Williams admitted that he had used his smart phone to take sexually explicit photos of two children at his home between the summer and fall of 2014. Williams uploaded the images to a “photo hosting” website. Williams also admitted that he had been downloading nude photographs of children from the internet for the past ten years.
The case was investigated by the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorney Jason Beaton. Sentencing is scheduled for May 15, 2015, at 1:30 p.m. in Tallahassee before United States District Judge Mark E. Walker.
The United States Attorney's Office for the Northern District of Florida is one of 94 offices that serve as the nation’s principal litigators under the direction of the Attorney General. The office strives to protect and serve the citizens of the Northern District of Florida through the ethical, vigorous, and impartial enforcement of the laws of the United States, to defend the national security, to improve the safety and quality of life in our communities through the protection of civil rights, and to protect the public funds and financial assets of the United States. To access public court documents online, please visit the U.S. District Court for the Northern District of Florida website. For more information about the United States Attorney’s Office, Northern District of Florida, visit http://www.justice.gov/usao/fln/index.html.
St. Paul Woman Pleads Guilty to Filing over $200,000 in False Tax ReturnsRead the Press Release
United States Attorney Andrew M. Luger today announced the guilty plea of CINDY LEE LINEBAUGH, 48, to one count of False, Fictitious and Fraudulent Claims. LINEBAUGH was indicted on September 24, 2014, and pleaded guilty on February 24, 2015, before U.S. District Judge Susan Richard Nelson in St. Paul, Minn.
According to the defendant’s guilty plea, in February 2010, LINEBAUGH began a tax fraud scheme in which she knowingly prepared and filed false tax returns on behalf of herself and others. LINEBAUGH used fraudulent W-2s which falsely claimed that the individuals were employed by and earned wages from employers such as Northwest Airlines and the City of St. Paul.
According to court documents, during calendar years 2010 and 2011, LINEBAUGH prepared and filed approximately 73 false returns for tax years 2009 and 2010 using online tax- preparation software. The refunds were loaded onto a debit card and sent by the IRS directly to the individuals. LINEBAUGH charged individuals anywhere from $100 to $300 for her tax- preparation services. The total amount of the tax loss for all returns was approximately $287,561.
This case is the result of an investigation conducted by the Internal Revenue Service – Criminal Investigation Division.
This case is being prosecuted by Assistant U.S. Attorney John E. Kokkinen.
Defendant Information:
CINDY LEE LINEBAUGH, 48
St. Paul, Minn.
Convicted:
• False, Fictitious and Fraudulent Claims, 1 countSt. Joseph Man Sentenced for Attempted Murder of an InformantRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a St. Joseph, Mo., man was sentenced in federal court today for attempting to murder an informant in retaliation for providing information to law enforcement officers.
Justin M. Hill, 21, of St. Joseph, was sentenced by U.S. District Judge Howard F. Sachs to five years and 11 months in federal prison without parole.
On April 25, 2014, Hill pleaded guilty to the attempted murder of an informant. The informant had told federal agents with the Bureau of Alcohol, Tobacco, Firearms and Explosives that Hill was bringing powder cocaine from Kansas City, Mo., to St. Joseph. Missouri State Highway Patrol troopers attempted to stop Hill, who while fleeing from them tossed two ounces of cocaine out of his vehicle. Hill was stopped and arrested, but troopers could not find the tossed cocaine.
On multiple occasions following the stop, law enforcement officers saw Hill searching in that area. When asked what he was looking for, Hill told them he was looking for a lost ring. On Sept. 5, 2013, law enforcement officers found the cocaine in brush about seven or eight feet from the roadway.
After the traffic stop, Hill told the confidential source that he believed the source had informed law enforcement about the cocaine. On Aug. 30, 2013, Hill used a Chevy Suburban to ram the confidential informant’s vehicle. Hill got out of his vehicle and fired six shots at the confidential informant.
This case was prosecuted by Assistant U.S. Attorney Patrick C. Edwards. It was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Buchanan County, Mo., Sheriff’s Department and the Missouri State Highway Patrol.
Silver Spring Man Pleads Guilty to $1.6 Million SBA Fraud SchemeRead the Press Release
Baltimore, Maryland - Stewart Mark Twayne Harris, age 38, of Silver Spring, Maryland, pleaded guilty today to bank fraud, money laundering and aggravated identity theft.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Small Business Administration Inspector General Peggy E. Gustafson; and Special Agent in Charge Michael McGill of the Social Security Administration - Office of Inspector General, Philadelphia Field Division.
According to his plea, in April 2009, Harris applied for a $1,666,700 loan from a commercial lender for the purported purpose of using loan proceeds to purchase a commercial glass company. The loan was to be guaranteed by the Small Business Administration (SBA). To secure the business loan, Harris submitted a loan application and purported tax returns in which he falsely represented the social security number of another individual to be his own. He also submitted false bank statements in which he used the stolen identity of a second victim, and an equity statement which falsely represented the amount of paid receipts and other cash injection into the business he was to purchase.
Based on this false documentation, the SBA and the lender approved the loan, with the SBA guaranteeing 89.99% of the loan amount. On June 26, 2009, the lender disbursed $1,591,666 to Harris. From June to October, 2009, in order to conceal the loan proceeds, Harris deposited and withdrew the proceeds into different bank accounts he controlled. On October 1, 2009, Harris withdrew part of the funds to make a deposit and down payment on the purchase of a home in Brandywine, Maryland.
Harris defaulted on the loan on January 5, 2011. SBA paid the lender approximately $1,515,918.90 in satisfaction of its loan guarantee.
In April 2012, Harris filed a voluntary petition for bankruptcy. In his petition to the bankruptcy court, Harris failed to declare the commercial lender as a creditor, and failed to disclose that he was an officer or director, and owner of five percent or more, of the glass company.
Harris has agreed to pay restitution of at least $1,666,700, and forfeit the residential property located in Brandywine, Maryland.
Harris faces a maximum sentence of 30 years in prison for bank fraud, 20 years in prison for money laundering and a mandatory minimum of two years in prison consecutive to any other sentence imposed for aggravated identity theft. U.S. District Judge J. Frederick Motz scheduled his sentencing for June 12, 2015, at 10:00 a.m.
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 SBA- OIG and SSA – OIG for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Thomas P. Windom, who is prosecuting the case.
Seventh Defendant Pleads Guilty in Mortgage Fraud Conspiracy That Resulted in at Least $3.9 Million in FraudRead the Press Release
At least 35 Properties throughout Minnesota went into Foreclosure as a Result of SchemeThe United States Attorney’s Office for the District of Minnesota today announced the guilty plea of JUSTIN JOSEPH CHRISTENSON, 35, who admitted conspiring with THOMAS ROSENSTEEL, ROBERT SCOTT “ROD” ASLESEN, and at least four others to defraud mortgage lenders by falsifying loan applications and related documents. CHRISTENSON is the seventh co-conspirator to plead guilty to participating in the scheme. The defendant pleaded guilty today before Senior Judge David S. Doty in U.S. District Court in Minneapolis, Minn. Last week, ROSENSTEEL and ASLESEN also entered guilty pleas before Judge Doty.
“This was a classic case of criminals perpetrating sham real estate scams to steal money,” said Minnesota Department of Commerce Commissioner Mike Rothman. “Commerce investigators are working closely with our colleagues from the U.S. Attorney's Office, FBI, and the U.S. Postal Inspection Service to stop financial fraud in our state.”
According to the defendants’ guilty pleas and documents filed in court, ROSENSTEEL founded, owned, and was the President of Split Rock Realty, a Twin Cities-based real estate company. In 2006, ROSENSTEEL hired CHRISTENSON to be his Director of Developments. From the fall of 2006 through the fall of 2007, ROSENSTEEL, a licensed real estate salesperson, and CHRISTENSON participated in numerous real estate transactions on behalf of Split Rock to conceal payments from mortgage loan proceeds and divert them to buyers of real properties and other individuals through the use of fraudulent underwriting and closing documentation. Moreover, ROSENSTEEL and others fraudulently concealed that the buyers were given money for down payments and passed these funds off as the buyers’ own funds, thereby misleading mortgage loan lenders to believe that the buyers had a financial stake in the purchased residences and thus incentive to pay the loans.
“This scheme was pervasive and calculated,” said Assistant U.S. Attorney William J. Otteson. “Although the defendants used a variety of complex terms and methods to justify their conduct, what they were convicted of is quite simple: they were lying to mortgage lenders to get money.”
According to the defendants’ guilty pleas and documents filed in court, ROSENSTEEL was aware that fraudulent loan application documentation was provided to potential lenders for purposes of loan underwriting. Among other things, the documentation falsely overstated the true purchase prices to be paid for the properties, falsely overstated the incomes of buyers/borrowers, and concealed the fact that payments were going to be made from the loan proceeds to the buyer and other individuals, including the defendant. CHRISTENSON and others, working with ROSENSTEEL’s knowledge and approval, worked to improperly influence appraisers to ensure that property appraisals were sufficiently inflated to facilitate the cash-back scheme. This included manipulating MLS listings and creating comparable sales for use in appraisals that were themselves fraudulent.
According to the defendants’ guilty pleas and documents filed in court, other individuals, including ASLESEN, a licensed closing agent who owned Split Rock Title (not affiliated with Split Rock Realty), facilitated the fraudulent scheme by making concealed payments to the buyers and other third parties, including through a company ASLESEN created, Eastwind Construction Consulting, whose only real purpose was to facilitate the distribution of the fraudulent payments. ROSENSTEEL, ASLESEN, and CHRISTENSON admitted participating in at least 35 fraudulent real estate transactions as part of the scheme, resulting in nearly all of the properties going into foreclosure. The actual loss to the mortgage holders was more than $2.5 million.
The three recent guilty pleas bring to seven the number of individuals who have pleaded guilty since 2011 in connection with this scheme. The others include: DALE RUSSELL WURZINGER, a licensed real estate agent working for Split Rock Realty; AMRI ELSAFY, owner of The Mortgage Shop, a real estate loan brokerage company; JAMES BRYAN CROOK, owner of Compass Title Company; and GERALD EDWIN CARLSON, a loan officer employed by Cascade Mortgage.
This case resulted from an investigation conducted by the Minnesota Department of Commerce, Federal Bureau of Investigation, and the United States Postal Inspection Service.
This case was prosecuted by Assistant U.S. Attorneys William J. Otteson and Robert M. Lewis.
Defendant Information:
JUSTIN JOSEPH CHRISTENSON, 35
Forest Lake, Minn.
Convicted:
• Conspiracy to commit wire fraud, 1 count
THOMAS EDWARD ROSENSTEEL, II, 42
Excelsior, Minn.
Convicted:
• Conspiracy to commit wire fraud, 1 count
DALE RUSSELL WURZINGER, 58
Burnsville, Minn.
Convicted:
• Conspiracy to commit wire fraud, 1 count
ROBERT SCOTT ASLESEN, a/k/a “ROD” ASLESEN, 66
Little Canada, Minn.
Convicted:
• Conspiracy to commit wire fraud, 1 count
AMRI ELSAFY, 43
Golden Valley, Minn.
Convicted:
• Conspiracy to commit wire fraud, 1 count
JAMES BRYAN CROOK, 59
Staten Island, N.Y.
Convicted:
• Conspiracy to commit wire fraud, 1 count
GERALD EDWIN CARLSON, 67
Kennedy, Minn.
Convicted:
• Conspiracy to commit wire fraud, 1 countPriest Pleads Guilty to Transportation of Child PornographyRead the Press Release
Jesuit Priest Richard James Kurtz, 69, formerly of Clarkston, Michigan, pleaded guilty today to transportation of child pornography, United States Attorney Barbara L. McQuade announced today.
McQuade was joined in the announcement by Special Agent in Charge Paul M. Abbate, Federal Bureau of Investigation, Detroit Division.
Kurtz admitted that in 2011 he transported child pornography from his home in Clarkston, Michigan to a new residence in Chicago, Illinois. Just after his move to Chicago, Kurtz was arrested for “sexual assault on a child by one in a position of trust” based on an arrest warrant issued out of Douglas County, Colorado. After Kurtz’s arrest in Chicago, two Jesuit priests discovered evidence of child pornography crimes among Kurtz’s belongings in Chicago, as well at Kurtz’s former residence in Clarkston, Michigan. The Jesuits provided that evidence to the FBI. At the plea hearing today, Kurtz acknowledged that his collection of child pornography exceeded 2,300 images.
Beyond his transportation of child pornography, court records indicated that Kurtz surreptitiously videotaped UDJHS hockey players after games during the 1998-1999 hockey season. Kurtz was a teacher of chemistry at the UDJHS from 1970-1973, 1978-1983, and from September 1984-May 2001.
Kurtz entered into a plea agreement that calls for a sentence of between 10-14 years in custody. District Judge Mark A. Goldsmith accepted Kurtz’s guilty plea, and took the proposed plea agreement under advisement. Sentencing is set for July 14, 2015.
McQuade praised the work of the FBI agents for their professionalism and dedication in their thorough investigation of these cases.
Assistant United States Attorneys Kevin M. Mulcahy is prosecuting this case for the United States.
Poplar Bluff Brothers Sentenced for Illegally Dealing in FirearmsRead the Press Release
Cape Girardeau, MO - DAVID HILTON RUSH and JOHN LYN RUSH were sentenced Tuesday for illegally dealing in firearms. David Rush was sentenced to 36 months in prison and John Rush was sentenced to 36 months. Both men appeared before United States District Judge Stephen N. Limbaugh, Jr.At the jury trial last November, trial testimony established that between 2010 and 2014 both brothers actively engaged in the business of selling firearms. Agents conducted a series of buys from each defendant using informants and undercover agents. Records show that during this time, John Rush alone sold more than 1200 firearms. A search warrant at John Rush’s residence resulted in the recovery of 71 firearms which the Court ordered forfeited to the United States.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms & Explosives. Assistant United States Attorney Keith D. Sorrell and John N. Koester, Jr. handled the prosecution for the Government.
Physician’s Assistant Admits Taking more than $70,000 in Bribes in Test-Referral Scheme with New Jersey Clinical LabRead the Press Release
NEWARK, N.J. – A Staten Island, New York, physician’s assistant today admitted accepting bribes in exchange for test referrals as part of a long-running and elaborate scheme operated by Biodiagnostic Laboratory Services LLC (BLS), of Parsippany, New Jersey, its president and numerous associates, U.S. Attorney Paul J. Fishman announced.
Leonard Marchetta, 48, pleaded guilty before U.S. District Judge Stanley R. Chesler in Newark federal court to an information charging him with one count of accepting bribes.
Including Marchetta, 36 people – 24 of them doctors – have pleaded guilty in connection with the bribery scheme – which its organizers have admitted involved millions of dollars in bribes and resulted in more than $100 million in payments to BLS from Medicare and various private insurance companies. The investigation has so far recovered more than $10.5 million to date through forfeiture.According to documents filed in this and related cases and statements made in court:
Marchetta admitted he accepted bribes in return for referring patient blood specimens to BLS and was paid approximately $3,000 per month. Marchetta’s referrals generated approximately $660,000 in lab business for BLS.
On April 9, 2013, federal agents arrested David Nicoll, 40, of Mountain Lakes, New Jersey, Scott Nicoll, 34, of Wayne, New Jersey, a senior BLS employee and David Nicoll’s brother, and Craig Nordman, 36, of Whippany, New Jersey, a BLS employee and the CEO of Advantech Sales LLC – one of several entities used by BLS to make illegal payments. They were charged by federal complaint with the bribery conspiracy, along with the BLS company and Frank Santangelo, 45, of Boonton, New Jersey. In June 2013, David and Scott Nicoll, Nordman and four other associates of BLS pleaded guilty to charges related to their involvement. Santangelo, a doctor, pleaded guilty in August 2013 to charges relating to his role in the scheme
The bribery count to which Marchetta pleaded guilty carries a maximum potential penalty of five years in prison and a $250,000 fine. Sentencing is scheduled for June 17, 2015. As part of his guilty plea, Marchetta must forfeit $72,000, representing the total bribe monies received from BLS.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Richard M. Frankel; U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert; IRS– Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen; and inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge Maria L. Kelokates, with the ongoing investigation leading to today’s guilty pleas.
The government is represented by Assistant U.S. Attorney Joseph Minish, Senior Litigation Counsel Andrew Leven, and Jacob T. Elberg, Chief of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark, as well as Assistant U.S. Attorney Barbara Ward of the office’s Asset Forfeiture and Money Laundering Unit.
U.S. Attorney Paul J. Fishman reorganized the health care fraud practice at the New Jersey U.S. Attorney’s Office shortly after taking office, including creating a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since 2010, the office has recovered more than $635 million in health care fraud and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Food, Drug and Cosmetic Act and other statutes.
15-068Defense counsel: Leo Duval Esq., Staten Island
North Carolina Man Convicted of Tax EvasionRead the Press Release
United States Attorney Deborah R. Gilg announced that Chet Lee West, 59, of Nebo, North Carolina, was convicted on Tuesday, February 25, 2015, after a jury found him guilty of three counts of tax evasion relating to tax years 2007, 2008 and 2009. Chief Judge Laurie Smith Camp presided over the trial that was held in United States District Court. Sentencing has been set for May 18, 2015. Mr. West faces up to 5 years imprisonment for each count of conviction as well as a $250,000 fine. Mr. West represented himself during the trial. He was remanded to the custody of the United States Marshal after the return of the guilty verdicts.
From 2007 through 2009 West earned taxable income of approximately $272,224.00 while living and working in Omaha, Nebraska. Upon that income West had a tax due and owing of approximately $52,824.00. West willfully evaded his personal income taxes by failing to file Forms 1040, U.S. Individual Income Tax Returns for tax years 2007 through 2009. After being informed by the Internal Revenue Service that he was required to file U.S. Individual Income Tax Returns, West continued to submit information to his employer in an attempt to avoid withholding any employment taxes from his pay, including numerous letters and affidavits stating his position that he was not required to pay income taxes. From 2007 through 2009, West also deposited personal income into bank accounts opened in the names of companies he created in an effort to hide and conceal his income from the Internal Revenue Service. West had not filed federal individual income tax returns since at least the 2000 tax year.
The case was investigated by Internal Revenue Service, Criminal Investigations.
North Augusta Man Sentenced for Possession of Child PornographyRead the Press Release
Contact Person: Bill Day (803) 929-3000
Columbia, South Carolina---- United States Attorney Bill Nettles stated that James O'Neal Arthur, Jr., age 57, of North Augusta, South Carolina was sentenced in federal court in Columbia, South Carolina, for Possession of Child Pornography, a violation of 18 U.S.C. § 2252S(a)(5)(B). United States District Judge J. Michelle Childs of Columbia sentenced Arthur to 10 years imprisonment, Restitution of $66,000.00 to be paid to the victims, to be followed by Supervised Release for life during which time Arthur will be required to register as a sex offender.
Evidence presented at the change of plea hearing established that an internet audit by Authur’s employer on April 1, 2014 detected inappropriate activity. The audit revealed Arthur had been visiting inappropriate websites so Arthur was sent home while a review was conducted. While at home Arthur contacted co-employees in an effort to get them to hide laptop computers and hard drives he had in his office. A forensic examination of the material found in his office uncovered thousands of images of young females engaged in sexually suggestive/explicit conduct. Further investigation revealed that Arthur had been producing child pornography videos for years from pictures he had taken of pre-teens and teens.
The case was investigated by agents of the U.S. Department of Energy, Office of Inspector General, Office of Investigations. Assistant United States Attorney William E. Day II of the Columbia office prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the United States Attorney’s Offices, 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 identify and rescue victims. For more information, please visit www.projectsafechildhood.gov.#####
New Haven Man Sentenced to Life in Prison for Committing Arson That Killed Three in Fair HavenRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that HECTOR NATAL, also known as “Boom” and “Boom Boom,” 29, of New Haven, was sentenced today by U.S. District Judge Janet Bond Arterton in New Haven to life imprisonment. After a four-week trial, Natal was convicted of committing the March 2011 arson of a two-family house in the Fair Haven section of New Haven that caused the deaths of 41-year-old Wanda Roberson, her 8-year-old son Quayshaun Roberson and her 21-year-old niece Jaqueeta Roberson.
“Hector Natal set fire to his neighbors’ home knowing that two large families, which included older women and young children, were inside,” said U.S. Attorney Daly. “This reckless act took the lives of three innocents, Wanda Roberson, her young son Quayshaun and her niece Jaqueeta, and the sentence imposed today will protect society from this defendant. I want to thank our law enforcement partners, particularly the New Haven Fire and Police Departments, the FBI and the Connecticut State Police, who expertly investigated this tremendously difficult case. We thank them for ensuring justice for all of the victims of this horrible crime, none of whom will ever fully recover from such an unimaginable loss.”
“Mr. Natal gave no thought to the lives he was endangering when he deliberately set the fire which killed three members of the Roberson family,” said FBI Special Agent in Charge Patricia M. Ferrick. “While today’s sentencing cannot bring back those lives or lessen the pain of the Roberson loss, we hope that it will bring closure and healing for both the Roberson family and the Fair Haven community.”
On April 18, 2013, Natal and his father, Hector Morales were found guilty on all counts of an 11-count indictment. According to the evidence presented during trial, Natal was a New Haven drug dealer who sold cocaine, crack cocaine, pills and marijuana. Morales served as Natal’s driver, facilitating his sales of narcotics and collection of drug proceeds. Early on the morning of March 9, 2011, Natal set fire to 48-50 Wolcott Street in New Haven in retaliation for a customer’s failure to pay a small drug debt. Seventeen people, including three toddlers, two pregnant women and two grandmothers, were in the house at the time the fire was set. Natal and Morales lived close to the Wolcott house. After the fire was set, Morales drove Natal away from the scene in his blue van. Hearing reports that a blue van was seen leaving the scene, Morales painted his van black in an effort to obstruct the investigation of the fatal fire. Natal and Morales then schemed with other family members to testify falsely before the grand jury in an effort to prevent the grand jury from developing evidence regarding their complicity in the arson.
The evidence at trial also showed that, months before the fatal fire, Natal attempted to set a fire in the same Wolcott Street house.
Natal was found guilty of three counts of arson resulting in death, and one count of attempted arson. Natal and Morales were both convicted of conspiring to distribute and to possess with intent to distribute narcotics, conspiring to tamper with witnesses and witness tampering. Morales was found guilty on three counts of being an accessory after the fact to the arson, and one count of destruction and concealment of evidence.
Natal has been detained since his arrest on June 14, 2011.
On January 8, 2015, Morales was sentenced to 174 months of imprisonment.
This matter was investigated by the Federal Bureau of Investigation, the New Haven Police Department, the Connecticut State Police Major Crimes Unit, Office of the State Fire Marshal, the New Haven Fire Department – Office of Fire Marshal, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the U.S. Department of Housing and Urban Development’s Office of Inspector General. The case was prosecuted by U.S. Attorney Deirdre M. Daly and First Assistant U.S. Attorney Michael J. Gustafson, with assistance and support from the New Haven State’s Attorney’s Office.
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Tom Carson
(203) 821-3722
[email protected]Nevada Woman Pleads Guilty to Access Device FraudRead the Press Release
BOISE – Elizabeth Carter, 21, of Reno, Nevada, pleaded guilty today in United States District Court to one count of access device fraud for using counterfeit credit cards, U.S. Attorney Wendy J. Olson announced. Sentencing is set for May 5, 2015, before Chief U.S. District Judge B. Lynn Winmill.
Carter, and co-defendant Rapphel Johnson, who already pleaded guilty, were indicted in September 2014, for access device fraud (credit card fraud) and identity theft. According to the plea agreement, Carter admitted that on September 1, 2014, she and Johnson knowingly used counterfeit credit cards containing the account numbers of real people to make a number of fraudulent purchases in Boise at stores including Rite Aid, Subway, T-Mobile, Finish Line, and Macy’s. In particular, Carter admitted using a counterfeit credit card, with another person’s account number, to purchase items at T-Mobile at the Boise Towne Square Mall. Additionally, Carter admitted that when she and Johnson were contacted by police, at a motel room rented with a counterfeit credit card, Johnson threw several counterfeit credit cards out the motel room window. The co-defendant, Johnson, is set for sentencing on March 16, 2015.
A violation of access device fraud is punishable by a maximum term of imprisonment of ten years, a term of supervised release of not more than three years, a maximum fine of $250,000, and a special assessment of $100.
The case was investigated by the United States Secret Service and the Boise Police Department.
Mt. Pleasant Postal Employee Charged with Theft of MailRead the Press Release
PITTSBURGH - A Westmoreland County resident has been indicted by a federal grand jury in Pittsburgh on a charge of theft of mail matter by postal service employee, United States Attorney David J. Hickton announced today.
The one-count indictment named Frank J. Rysz, 49, of Mt. Pleasant, Pa., as the sole defendant.
According to the information presented to the court, Rysz, an employee of the United States Postal Service, engaged in the theft of three first class letters and their valuable contents from the U.S. mails. Rysz also took one advertisement from the U.S. mails.
The law provides for a maximum total sentence of five years in prison, a fine of $250,000 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Paul E. Hull is prosecuting this case on behalf of the government.
The U.S. Postal Service-Office of Inspector General conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Moundsville, WV man convicted of cocaine traffickingRead the Press Release
WHEELING, WEST VIRGINIA – Kenneth L. Smith, 26, of Moundsville, West Virginia, was convicted in federal court today of selling crack cocaine, United States Attorney William J. Ihlenfeld, II, announced today.
An investigation by the Ohio Valley Drug and Violent Crime Task Force, a HIDTA-funded initiative, revealed that Smith sold crack cocaine in November 2013 in Ohio County, West Virginia.
Smith pled guilty today to one count of “Distribution of Cocaine Base.” 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.
Assistant U.S. Attorney David Perri is prosecuting the case on behalf of the government.
U.S. Magistrate Judge James E. Seibert presided.Minnesota Man Receives Prison Time for Firearms ChargesRead the Press Release
BILLINGS – A Minnesota man was sentenced to 7 years in prison after stealing firearms from The Fort store in Big Timer. Guy George Parenteau, 57, a convicted felon from the State of Minnesota, received 84 months in prison followed by 3 years supervised release in connection to his September 2014 guilty plea to being a felon in possession of firearms.
Assistant U.S. Attorney Paulette Stewart told the court that on September 14, 2013 Guy Parenteau burglarized and stole eight firearms from The Fort store, in Big Timber. Parenteau led law enforcement on an unrelated, high-speed chase in Park County within 12 hours of the burglary. A search of Parenteau’s vehicle led to the recovery of seven of the eight firearms. The eighth firearm was located near the railroad tracks and turned in law enforcement. All of the stolen firearms will be returned to The Fort store.
The investigation was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives, Sweet Grass County Sheriff’s Office, Park County Sheriff’s Office and the Montana Highway Patrol.
Metlife Home Loans Llc, Successor to Metlife Bank N.a., to Pay $123.5 Million to Resolve Alleged Federal Housing Administration Mortgage Lending ViolationsRead the Press Release
WASHINGTON – MetLife Home Loans LLC has agreed to pay the United States $123.5 million to resolve allegations that MetLife Bank N.A. (MetLife Bank) violated the False Claims Act by knowingly originating and underwriting mortgage loans insured by the U.S. Department of Housing and Urban Development’s (HUD) Federal Housing Administration (FHA) that did not meet applicable requirements, the Justice Department announced today.
MetLife Bank was a banking services company headquartered in Bridgewater, New Jersey. In June 2013, MetLife Bank merged into MetLife Home Loans LLC, a mortgage finance company headquartered in Irving, Texas. MetLife Bank was, and MetLife Home Loans LLC is, a wholly owned subsidiary of MetLife Inc., a holding company headquartered in New York City.
“MetLife Bank took advantage of the FHA insurance program by knowingly turning a blind eye to mortgage loans that did not meet basic underwriting requirements, and stuck the FHA and taxpayers with the bill when those mortgages defaulted,” said U.S. Attorney John Walsh of the District of Colorado. “This settlement is part of our systematic, national effort to hold lenders accountable for irresponsible lending practices that not only harmed FHA, but also contributed to a catastrophic wave of home foreclosures across the country.”
“MetLife Bank’s improper FHA lending practices not only wasted taxpayer funds, but also inflicted harm on homeowners and the housing market that lasts to this day,” said Acting Assistant Attorney General Joyce R. Branda of the Justice Department’s Civil Division. “As this settlement shows, we will continue to hold accountable financial institutions that elected to ignore the rules and to pursue their own financial interests at the expense of hardworking Americans.”
During the time period covered by the settlement, MetLife Bank participated as a Direct Endorsement Lender (DEL) in the FHA insurance program. A DEL has the authority to originate, underwrite and certify mortgages for FHA insurance. If a loan certified for FHA insurance later defaults, the holder of the loan may submit an insurance claim to the FHA for the losses resulting from the defaulted loan. Because the FHA does not review the underwriting of a loan before it is endorsed for FHA insurance, the FHA depends on a DEL to follow program rules to ensure that only eligible loans are submitted for FHA insurance.
As part of the settlement, MetLife Home Loans LLC admitted to the following facts: From September 2008 through March 2012, it repeatedly certified for FHA insurance mortgage loans that did not meet HUD underwriting requirements. MetLife Bank was aware that a substantial percentage of these loans were not eligible for FHA mortgage insurance due to its own internal quality control findings. According to these findings, between January 2009 and August 2010, the portion of MetLife Bank loans containing the most serious category of deficiencies, which MetLife Bank called “material/significant,” ranged from 25 percent to more than 60 percent. These quality control findings were routinely shared with MetLife Bank’s senior managers, including the chief executive officer and board of directors. While the overall “significant” error rate identified by MetLife Bank decreased in 2010 and 2011, during the same time period, MetLife Bank more frequently downgraded FHA loans from “significant” to “moderate.” In one instance, a quality control employee wrote in an email discussing MetLife Bank’s practice of downgrading its quality control findings: “Why say Significant when it feels so Good to say MODERATE.” Overall, between January 2009 and December 2011, MetLife Bank identified 1,097 FHA mortgage loans underwritten by MetLife Bank with a “significant” finding, but despite an obligation to self-report findings of material violations of FHA requirements, MetLife Bank only self-reported 321 mortgages to HUD. MetLife Bank’s conduct caused FHA to insure hundreds of loans that were not eligible for insurance and, as a result, FHA suffered substantial losses when it later paid insurance claims on those loans.
“The settlement announced today is the culmination of two years of work by HUD OIG and our continued efforts to identify and properly respond to instances of fraud against HUD’s mortgage insurance program,” said Inspector General David Montoya of HUD.
“We appreciate that MetLife Bank has accepted responsibility for its actions and is settling with the government,” said General Counsel Helen Kanovsky of HUD. “We want to thank the Department of Justice and HUD’s Office of Inspector General for all of their efforts in helping us make this settlement a reality. This settlement with MetLife Bank underscores our consistent message that HUD takes compliance with its requirements seriously.”
The settlement was the result of a joint investigation conducted by HUD, HUD OIG, the Civil Division and the U.S. Attorney’s Office for the District of Colorado.
Methuen Man Sentenced to 27 Months for Identity FraudRead the Press Release
BOSTON – A Dominican national living in Methuen was sentenced on Monday for using stolen identities to obtain official identification documents.
Delcin Belarminio Soto Baez, a/k/a Nelso Santos Ramos, was sentenced by U.S. District Court Judge F. Dennis Saylor, IV, to 27 months in prison and one year of supervised release. In July 2014, Baez pleaded guilty to passport fraud and false representation to the Social Security Administration.
In April 2004, Baez submitted an application for a U.S. passport at the U.S. Post Office in Lawrence, representing himself to be José Torres, an individual born in the Commonwealth of Puerto Rico and, therefore, a U.S. citizen. Almost eight years later, in January 2012, Baez submitted an application for a Social Security number replacement card at the Social Security Administration District Office in Lawrence, representing himself to be Hermer Maldonado, a U.S. citizen also born in the Commonwealth of Puerto Rico.
A subsequent investigation revealed that Baez assumed the identities of the true JosJ Torres and Hermer Maldonado, which he supported with government issued birth certificates and photo identification documents. Baez provided these identities, along with other aliases, to law enforcement officials at various times when arrested on separate and unrelated state narcotics charges. Baez is a citizen of the Dominican Republic with no legal status in the United States.
United States Attorney Carmen M. Ortiz; David W. Hall, Special Agent in Charge of the U.S. Department of States, Bureau of Diplomatic Security, Boston Field Office; and Scott Antolik, Special Agent in Charge of the U.S. Social Security Administration, Office of Inspector General, Office of Investigations, Boston Field Division, made the announcement. The case was prosecuted by Assistant U.S. Attorney Carlos A. López of Ortiz’s Drug Task Force Unit.
MetLife Home Loans LLC, Successor to MetLife Bank N.A., to Pay $123.5 Million to Resolve Alleged Federal Housing Administration Mortgage Lending ViolationsRead the Press Release
MetLife Home Loans LLC has agreed to pay the United States $123.5 million to resolve allegations that MetLife Bank N.A. (MetLife Bank) violated the False Claims Act by knowingly originating and underwriting mortgage loans insured by the U.S. Department of Housing and Urban Development’s (HUD) Federal Housing Administration (FHA) that did not meet applicable requirements, the Justice Department announced today.
MetLife Bank was a banking services company headquartered in Bridgewater, New Jersey. In June 2013, MetLife Bank merged into MetLife Home Loans LLC, a mortgage finance company headquartered in Irving, Texas. MetLife Bank was, and MetLife Home Loans LLC is, a wholly owned subsidiary of MetLife Inc., a holding company headquartered in New York City.
“MetLife Bank’s improper FHA lending practices not only wasted taxpayer funds, but also inflicted harm on homeowners and the housing market that lasts to this day,” said Acting Assistant Attorney General Joyce R. Branda of the Justice Department’s Civil Division. “As this settlement shows, we will continue to hold accountable financial institutions that elected to ignore the rules and to pursue their own financial interests at the expense of hardworking Americans.”
“MetLife Bank took advantage of the FHA insurance program by knowingly turning a blind eye to mortgage loans that did not meet basic underwriting requirements, and stuck the FHA and taxpayers with the bill when those mortgages defaulted,” said U.S. Attorney John Walsh of the District of Colorado. “This settlement is part of our systematic, national effort to hold lenders accountable for irresponsible lending practices that not only harmed FHA, but also contributed to a catastrophic wave of home foreclosures across the country.”
During the time period covered by the settlement, MetLife Bank participated as a Direct Endorsement Lender (DEL) in the FHA insurance program. A DEL has the authority to originate, underwrite and certify mortgages for FHA insurance. If a loan certified for FHA insurance later defaults, the holder of the loan may submit an insurance claim to the FHA for the losses resulting from the defaulted loan. Because the FHA does not review the underwriting of a loan before it is endorsed for FHA insurance, the FHA depends on a DEL to follow program rules to ensure that only eligible loans are submitted for FHA insurance.
As part of the settlement, MetLife Home Loans LLC admitted to the following facts: From September 2008 through March 2012, it repeatedly certified for FHA insurance mortgage loans that did not meet HUD underwriting requirements. MetLife Bank was aware that a substantial percentage of these loans were not eligible for FHA mortgage insurance due to its own internal quality control findings. According to these findings, between January 2009 and August 2010, the portion of MetLife Bank loans containing the most serious category of deficiencies, which MetLife Bank called “material/significant,” ranged from 25 percent to more than 60 percent. These quality control findings were routinely shared with MetLife Bank’s senior managers, including the chief executive officer and board of directors. While the overall “significant” error rate identified by MetLife Bank decreased in 2010 and 2011, during the same time period, MetLife Bank more frequently downgraded FHA loans from “significant” to “moderate.” In one instance, a quality control employee wrote in an email discussing MetLife Bank’s practice of downgrading its quality control findings: “Why say Significant when it feels so Good to say MODERATE.” Overall, between January 2009 and December 2011, MetLife Bank identified 1,097 FHA mortgage loans underwritten by MetLife Bank with a “significant” finding, but despite an obligation to self-report findings of material violations of FHA requirements, MetLife Bank only self-reported 321 mortgages to HUD. MetLife Bank’s conduct caused FHA to insure hundreds of loans that were not eligible for insurance and, as a result, FHA suffered substantial losses when it later paid insurance claims on those loans.
“The settlement announced today is the culmination of two years of work by HUD OIG and our continued efforts to identify and properly respond to instances of fraud against HUD’s mortgage insurance program,” said Inspector General David Montoya of HUD.
“We appreciate that MetLife Bank has accepted responsibility for its actions and is settling with the government,” said General Counsel Helen Kanovsky of HUD. “We want to thank the Department of Justice and HUD’s Office of Inspector General for all of their efforts in helping us make this settlement a reality. This settlement with MetLife Bank underscores our consistent message that HUD takes compliance with its requirements seriously.”
The settlement was the result of a joint investigation conducted by HUD, HUD OIG, the Civil Division and the U.S. Attorney’s Office for the District of Colorado.
Members of Violent Drug Trafficking Ring ConvictedRead the Press Release
United States Attorney Karen L. Loeffler announced today the conclusion of two trials in the past two months, bringing to an end an 18-month investigation into a drug trafficking ring that not only distributed heroin, cocaine, crack, and methamphetamine, but also conducted home invasions, drive-by shootings, committed kidnappings and sexual assaults, and used firearms in furtherance of those crimes.
In November 2013, a grand jury indicted Stuart T. Seugasala, a.k.a. "Tone," age 40, Phosavan Khamnivong, a.k.a. “P.K.,” age 35, Timothy Miller, a.k.a. "Lil Tone," age 26, Anoai Sialofi, a.k.a. "A-Loc", age 26, and Laura Khamnivong (Phosavan’s wife), age 33, for drug trafficking conspiracy. Kidnapping and firearms charges were brought against Seugasala, Khamnivong, Miller, and Sialofi. Seugasala and Stacy Laulu, age 33, were also charged with violations of the Health Information Portability and Accountability Act (HIPAA). Miller, Sialofi, and Laura Khamnivong pled guilty before trial. All of the defendants were from Anchorage, Alaska.
The January 5, 2015, first trial involved the charges against Stuart T. Seugasala and Stacy Laulu. Prior to that, Miller and Sialofi had pleaded guilty to the two kidnapping charges. Laura Khamnivong had pleaded guilty to the drug trafficking conspiracy charge. Seugasala was charged with orchestrating a violent drug trafficking ring that both imported drugs and engaged in home invasions to obtain money and drugs. The jury heard evidence that Seugasala sexually assaulted his victims, including two victims that were raped with a hot curling iron on March 13, 2013. The reason for the brutal assault on the two victims was that one of them had owed Phosavan Khamnivong a drug debt that Seugasala believed had also been owed to him. After the hospitalization of one of the sexual assault victims, Seugasala sought and obtained that victim’s private health information from Stacy Laulu, then an employee of Providence Hospital. The information concerned the extent of the victim’s injuries, and whether the victim was cooperating with police. Seugasala also sought and obtained from Laulu the health information of another victim, whom Seugasala shot on March 15, 2013. Laulu likewise violated the privacy rights of that victim when she disclosed the victim’s personal health information to Seugasala.
On January 16, 2015, a federal jury convicted Seugasala of Drug Conspiracy, two counts of Kidnapping, and two counts of using firearms in furtherance of those crimes. The jury also convicted Seugasala and Laulu with two felony counts of HIPAA violations. Seugasala faces mandatory life imprisonment on the drug conspiracy conviction, two maximum life sentences on the kidnapping and firearms convictions. Seugasala had previously been convicted of two federal drug conspiracy charges in 2000 and served over ten years in federal prison. Both he and Laulu face a maximum of ten years imprisonment on each of the HIPAA convictions.
On February 24, 2015, a separate federal jury convicted Khamnivong of Drug Conspiracy, two counts of Kidnapping, and two counts of using firearms in furtherance of those crimes. During this trial, Khamnivong was identified as the financier for the conspiracy, as well as the person to whom Victim A owed a prior drug debt. At trial, Khamnivong was identified as the man who held Victim A down while Seugasala sexually assaulted Victim A. Khamnivong now faces the possibility of three federal life sentences without the possibility of parole for the drug conspiracy and two kidnappings, to be followed by additional time for the firearms convictions.
Khamnivong also faces eight years in state prison for violating his probation and parole. He was convicted in 1998 of murder in the second degree and was sentenced in that case to serve 25 years with 10 years suspended and was placed on probation for 10 years.
While Assistant United States Attorneys Frank V. Russo and Stephan A. Collins were prosecuting the Khamnivong trial, the DEA arrested Jason McAnulty for attempting to tamper with a witness who was scheduled to testify at the trial. According to an affidavit filed in support of a criminal complaint, McAnulty is alleged to have contacted Victim A and conveyed a message from Khamnivong. The message was that if Victim A did not testify against Khamnivong at trial, Victim A would receive a classic automobile that belonged to Khamnivong. The DEA recorded conversations between McAnulty and Victim A to confirm this attempted bribe. McAnulty was arrested and charged with attempted witness tampering. Magistrate Judge Deborah Smith found probable cause to detain McAnulty pending presentation of the case to the Grand Jury.
The trial evidence at both trials included the graphic and cruel nature of the drug conspiracy. Seugasala would imprison drug users and others in his apartment, located at 1046 W. 26th Avenue, as well as his video gaming business, "Friendly Fire" in Anchorage. He sometimes tortured individuals who owed him money or disrespected him or others in his organization. Seugasala and his accomplices burned people with cigarettes, sexually assaulted them, used firearms on them, and assaulted them in other ways.
In February, 2013, Seugasala, P. Khamnivong, and Miller conspired to mail over five pounds of methamphetamine from California to Alaska. The United States Postal Service intercepted the drugs before they were delivered. The evidence at both trials established that the men lost another pound of methamphetamine during the same time period. On March 13, 2013, the men attempted to collect a drug debt owed by Victim A to P. Khamnivong. Seugasala lured Victim A, as well as another victim, to Miller's apartment at 1046 W. 26th Avenue. When the victims entered, Khamnivong, Miller, and Sialofi drew guns on the victims, duct taped them, beat them, and tortured them for approximately three hours. Seugasala raped the victims with a hot curling iron while telling Victim A that this is “what happens to [people] who don’t pay.” P. Khamnivong stepped Victim A’s head down while Seugasala raped him. Seugasala instructed Miller to videotape the rape of Victim A, which Miller did. Seugasala later showed the video to others to intimidate them and to show them what would happen if they didn't repay their drug debts. .
Seugasala and Khamnivong then put guns to both victims' heads, going so far as handing the gun to the second victim and telling him that he had to kill Victim A, or they both would die. The men were held for approximately three hours, then forced to go to a strip club with the men, where Victim A agreed to pay Khamnivong $50,000 within 30 days. On those conditions, both men were released. Victim A went to Providence Hospital, where he was admitted for his injuries. At the time, Stacy Laulu was a financial counselor of Providence Hospital. The testimony at trial was that Laulu's husband was a close associate of Seugasala, and that Seugasala and Miller continued to deliver drug money to Laulu and Laulu's husband, who was in jail on unrelated murder charges. Seugasala communicated by text message to Laulu and requested information on Victim A's medical condition and whether he was cooperating with authorities investigating the sexual assault. Laulu accessed Victim A's medical records and provided Seugasala with the information. Seugasala also asked Laulu about the condition of another individual, who was treated for a gunshot wound at Providence Hospital on March 15. Testimony at trial indicated that Seugasala shot the man's vehicle as it drove south on the Seward Highway. Apparently the man had insulted Seugasala's companion at a restaurant in the early morning hours of March 15. The bullet disfigured the man's pinky, as well as grazed his neck.
On April 23, 2013, the Valdez Police Department arrested Devon Totemoff and Timothy Miller, after they had arrived in Valdez to sell drugs supplied by Seugasala and Khamnivong. Valdez Police seized Miller's telephone and got a search warrant for it. The Alaska State Troopers executed the search warrant on the phone and ultimately found the sexual assault video from March 13.
In the meantime, the Anchorage Police Department, the Drug Enforcement Administration, and the FBI Safe Streets Task force were investigating Seugasala and Khamnivong. They observed the two men meet on May 16, and Anchorage Police pulled over Khamnivong's vehicle. When the police officer notified Khamnivong that he planned to search Khamnivong’s vehicle, Khamnivong smashed his car into two patrol vehicles and fled the scene, ultimately escaping. A citizen found a discarded pistol near Stellar High School, which was along the route that Khamnivong's vehicle followed while escaping. Anchorage Police and FBI Safe Streets Task Force members then followed the defendant's wife's vehicle to where she stopped in a parking lot; an officer saw her put a plastic bag in another vehicle. APD obtained a search warrant and found two guns, a small amount of methamphetamine, and drug paraphernalia in the bag.
On May 20, 2013, the DEA conducted surveillance of Seugasala, and saw him visit a number of locations around Anchorage. He was stopped by the Anchorage Police Department, who contacted the United States Probation Office. The United States Probation Office directed that the Anchorage Police search the defendant and his vehicle. The police seized nearly $8,000 and Seugasala's cellular telephone. The DEA executed a search warrant on the phone and found the text exchanges between Laulu and Seugasala, as well as text messages with Miller on March 13 to arrange the kidnappings.
Seugasala was arrested by the United States Probation Office on June 12, 2013, the day after the defendant was identified in the sexual assault video. Additional money and cellular telephones were found, including a cellular telephone used by Miller to communicate with both Seugasala and Khamnivong when he was in California obtaining drugs in February.
After he fled on May 16, 2013, Khamnivong remained in hiding until December 4, 2013, when he was arrested by members of the U.S. Marshals Fugitive Task Force. Agents seized more drugs, guns, money, and drug paraphernalia in the apartment where Khamnivong was hiding.
United States Chief District Court Judge Ralph R. Beistline, who presided over the trials, scheduled sentencing hearings for the various defendants in late April through early May, 2015.
United States Attorney Karen L. Loeffler noted: “This case was the result of hard work, perseverance and dedication by a myriad of federal, state and local agencies focused on protecting the public safety of our community. The convicted defendants were and are dangerous, violent individuals. We are blessed in Alaska to have such a strong working relationship between and among our law enforcement agencies and partners and we will remain committed to the arrest and conviction of these violent individuals and organizations.”
The case was investigated by the Drug Enforcement Administration, with assistance from the FBI's Safe Streets Task Force and its Cellular Assistance Survey Team, as well as Bureau of Alcohol Tobacco, Firearms and Explosives, the Anchorage Police Department, the Valdez Police Department, the Alaska State Troopers Technical Crimes Unit and State Crime Laboratory, the United States Postal Inspection Service, the Department of Homeland Security, Providence Hospital, the United States Marshals, and the United States’ Probation Office. The prosecution of the defendants was coordinated with the State of Alaska Attorney General's Office.
Medicare Beneficiary Pleads Guilty in Kickback Scheme Involving Ambulance Transport ServicesRead the Press Release
PHILADELPHIA – William Conner, 61, of Philadelphia, PA, pleaded guilty today to receiving kickbacks and making false statements to law enforcement officials in connection with unnecessary ambulance transportation services. Conner faces a maximum possible sentence of 20 years in prison, three years of supervised release, a $1 million fine, a $400 special assessment, and an order of restitution. U.S. District Court Judge William H. Yohn, Jr. scheduled a sentencing hearing for May 28, 2015.
In July 2010, Feda Kuran, charged elsewhere, began operating Brotherly Love Ambulance, Inc. with a co-schemer. Even though he could have been transported safely by other means and was, therefore, not eligible for ambulance service under Medicare and Medicaid requirements, Conner began using Brotherly Love for transportation to dialysis treatments. Conner accepted monthly payments from Kuran and others to induce him to continue to ride with Brotherly Love and, as a result of his actions and those of Brotherly Love, the Medicare program paid more than $55,000 in inappropriate bills. As a result of the overall scheme at Brotherly Love, the Medicare program paid more than $2 million in inappropriate bills. When interviewed by federal law enforcement officers about receiving payments, Conner lied, denying that he had received cash from Brotherly Love. Kuran was sentenced in November 2014 to 64 months in prison.
The case was investigated by the U.S. Department of Health and Human Services Office of the Inspector General, the Federal Bureau of Investigation, and the U.S. Department of Labor Office of the Inspector General. It is being prosecuted by Assistant United States Attorneys Matthew J.D. Hogan and Paul W. Kaufman.
Mansfield Woman Accused of Stealing from Social SecurityRead the Press Release
A federal grand jury today returned an indictment in U.S. District Court charging Helen Love, 62, of Mansfield, Ohio, with theft of public money, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The alleged theft of Social Security funds, occurring between 2009 and 2013, totaled approximately $34,204.
The United States Social Security Administration Office of the Inspector General conducted the investigation. The case is being prosecuted by Assistant United States Attorney Justin Seabury Gould.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
A criminal 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.
Mansfield Trio Charged for Bank RobberiesRead the Press Release
A federal grand jury returned a four-count indictment charging Kyle A. Tesca, age 21, Caleb A. Lambert, age 21, and Kollin J. Tesca, age 19, all of Mansfield, Ohio, with armed bank robbery and brandishing firearms during the bank robberies, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment alleges in Count 1 that on December 15, Kyle A. Tesca, Caleb A. Lambert, and Kollin J. Tesca robbed the Richland Bank located at 460 West Cook Road, Mansfield, Ohio. Count 3 alleges that on January 15, 2015, they robbed the Chase Bank located at 1094 Lexington Avenue, Mansfield, Ohio.
The indictment further alleges in Counts 2 and 4 that Kyle A. Tesca and Caleb A. Lambert brandished firearms during each of the bank robberies.
If convicted, a defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal records, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The investigation preceding the indictment was conducted by the Federal Bureau of Investigation’s Mansfield Office. The case is being prosecuted by Assistant United States Attorney Linda H. Barr.
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.