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Friday 20 February 2015
Store Owner Sentenced to Prison and Forfeiture of Funds for Federal Food Program FraudRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that an Anchorage store owner was sentenced by U.S. District Court Judge Timothy M. Burgess to 18 months imprisonment, along with forfeiture of over $42,000 in criminal proceeds in connection with a United States Department of Agriculture food aid program fraud scheme which he operated out of his Anchorage store.
In late 2013, Africa and Middle East Market store owner Ayub Yusuf Eprahin, 45, was charged by the federal grand jury with 15 counts of wire fraud and 11 counts of U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) food aid fraud in connection with the illegal use of food aid debit cards. Eprahin, who plead guilty in 2014, to two counts of wire fraud, contested the overall loss amount of the scheme, claiming it amounted to only $42,000. In day-long and contentious sentencing hearing, Judge Burgess found that Eprahin had defrauded the United States Department of Agriculture of more than $335,000 over a period of 19 months. As part of that finding, Judge Burgess imposed a sentence of 18 months imprisonment, forfeited to the United States more than $42,000 in funds seized from Eprahin, and imposed a term of three years of supervised release.
According to Assistant U.S. Attorney Steve Skrocki, in November, 2012, Eprahin was the owner of the Africa and Middle East Market and a participant in the Supplemental Nutrition Assistance Program (SNAP), formerly known as the “Food Stamp Program” administered by the United States Department of Agriculture’s Food and Nutritional Service. The program is designed to provide authorized nutritional foods to low-income families. The federal government pays the full cost of the SNAP benefits and also shares with the states some of the administrative costs. Under the SNAP program, authorized recipients are issued a certain amount of benefits each month, which they may use to purchase eligible food items. SNAP recipients typically receive their benefits in the form of a credit on their personal electronic benefit transfer card. The rules of the program prohibit the purchase of items other than food, and the card benefits cannot be redeemed for cash. As a participant in the program, Eprahin received computer issued payments based on unauthorized purchases made by participants from his store.
As part of the scheme Eprahin permitted non-food items and cash to be redeemed from participants in the program on a large scale. In so doing, Eprahin represented to the SNAP program that the benefits were being redeemed to purchase eligible food items when they in fact were not. Instead, Judge Burgess found that the cards were being used like ATM cards with amounts being debited for cash instead of food items required by the program and with some of that cash being wired overseas. Judge Burgess noted that Eprahin’s actions negatively impacted the community, other small businesses and the integrity of a government program designed to help and feed people in need, finding the offense, “very, very serious as hundreds of thousands were misused by not being provided to those it was supposed to help.”
Ms. Loeffler commends the Federal Bureau of Investigation, and United States Department of Agriculture, Office of Inspector General, who administers the SNAP program, for their investigation of this case.
St. Louis Man Sentenced for Drug and Money Laundering ConspiraciesRead the Press Release
A St. Louis man, convicted of Conspiracy to Distribute Methamphetamine and Conspiracy to Commit Money Laundering, was sentenced to 144 months in federal prison on February 20, 2015, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today. Zachary Weil, 36, of St. Louis, MO, received a 144 month sentence for offenses which occurred in St. Clair County, IL and in St. Louis, Mo. Weil had previously pled guilty to those offenses. Following release from imprisonment, Weil will serve a 5 year term of supervised release. Weil was also ordered to pay a $400 fine and a $200 special assessment.
Evidence in support of this prosecution was obtained in an investigation which was conducted under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF). The OCDETF initiative is designed to bring federal, state, and local law enforcement agencies and resources together to identify, target and dismantle large national and international drug trafficking organizations. Agencies participating in this case include the Drug Enforcement Administration, Internal Revenue Service, Criminal Investigations, Federal Bureau of Investigation, Bureau of Alcohol, Tobacco, Firearms, and Explosives, and United States Marshals Service. This case was prosecuted by Assistant United States Attorney Donald S. Boyce.
St. Charles, Missouri Man Sentenced on Firearm ChargeRead the Press Release
The United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today that Steven L. Carson, 27, of St. Charles, Missouri, was sentenced on Friday, February 20, 2015, to 30 months in federal prison for being a Felon in Possession of a Firearm.
Carson pled guilty to the federal charge on October 15, 2014 in U.S. District Court in East St. Louis, Illinois.
At his change of plea hearing in October, Carson admitted that he had possessed a .40 caliber semi-automatic pistol on May 6, 2012, in Brooklyn, Illinois. Carson was arrested as he was leaving the Pink Slip Topless Club in Brooklyn. Carson also admitted that he had been previously convicted of the felony offense of 1st Degree Burglary in 2005, in state court in St. Louis County, Missouri.
The investigation which resulted in Carson’s arrest and conviction was conducted by special agents of the Federal Bureau of Alcohol, Tobacco and Firearms (ATF).
The case was prosecuted by Assistant United States Attorneys Daniel T. Kapsak and Robert L. Garrison.
Secretary General Presents on Foreign Terrorist Fighters at White House, Visits Interpol WashingtonRead the Press Release
WASHINGTON, DC – On February 19, 2015, newly elected Interpol Secretary General Jürgen Stock visited the Interpol Washington office. While at the agency, Dr. Stock addressed Interpol Washington staff, highlighting the role effective information sharing can play via the world police body’s tools and resources and underscoring that the key to the organization’s strength lies in collaboration with Interpol’s 189 other member countries. Dr. Stock also emphasized the importance of defining Interpol’s core capabilities. After his remarks, the Secretary General toured the office, visiting with analysts in Interpol Washington’s 24/7 Interpol Operations and Command Center (IOCC) and meeting with Interpol Washington’s senior staff.
Prior to his visit at Interpol Washington, the Secretary General presented at a ministerial session during the White House Summit on Countering Violent Extremism. The meeting was organized by the U.S. Department of State and attended by Secretary of State John Kerry, Attorney General Eric Holder and Assistant Attorney General John Carlin. In his address, Dr. Stock underlined the effectiveness of Interpol’s Foreign Terrorist Fighter program to deter the movements of foreign fighters. The program represents the third pillar of President Barack Obama’s National Security Strategy and was lauded as a critical component in the fight against transnational crime in the United Nations’ Security Council Resolution 2178. The program has over 40 participating countries which share information on more than 1,500 suspected and confirmed fighters linked to Syria and Iraq. Foreign fighters may seek to travel with revoked passports, stolen or lost passports, or simply their own valid travel documents. In the first two cases, Interpol’s Stolen and Lost Travel Document database can make this information available at the frontlines. In cases where the individual’s valid passport information has been shared, Interpol global tools will generate hit alarms.
For more information on Secretary General Stock’s trip to Washington, DC, read Interpol’s press release at http://www.interpol.int/News-and-media/News/2015/N2015-015.
Seattle Man who Advertised Illegal Arsenal from Magnolia Apartment Sentenced to PrisonRead the Press Release
A man who sold guns and heroin from the basement apartment of a home in Seattle’s Magnolia neighborhood, was sentenced today in U.S. District Court in Seattle to six years in prison and three years of supervised release, announced Acting United States Attorney Annette L. Hayes. JORGE CARLOS CAMPS, 34, was arrested in May 2014, when law enforcement seized a dozen weapons including a Mac-11 submachine gun and silencer. The home was just a few blocks from a busy playground in a neighborhood park. CAMPS pleaded guilty in November 2014. At sentencing U.S. District Judge Richard A. Jones said CAMPS was dealing in “a dangerous combination of firearms and drugs.”
“This defendant played Russian Roulette with public safety by offering to put high powered firearms into the hands of anyone ready to pay,” said Acting U. S. Attorney Annette L. Hayes. “By ignoring the regulatory requirements that licensed dealers must comply with, Camps became part of the black market that regularly provides guns to convicted felons who often go on to use them to commit further crimes. Our communities should not have to deal with additional murders, assaults and armed robberies because of this defendant’s wrong doing.”
According to records in the case, on April 28, 2014, CAMPS sold heroin and a firearm to a person working with law enforcement. CAMPS sent pictures of various weapons via text message, along with a price list for the guns. He was selling assault rifles, tactical ballistic body armor, military grade ammunition, silencers, and a variety of tactical accessories. CAMPS also possessed, and was willing to sell, various badges and patches from area police departments. CAMPS has a prior felony conviction for violating a domestic violence court order and is prohibited from possessing firearms.
A second defendant, Roger Lee Hiddleston, 44, of Seattle, pleaded guilty in November 2014 and was sentenced to six years in prison for possessing a firearm and supplying heroin to CAMPS. Police stopped Hiddleston’s car after he left the Magnolia home. Inside they found heroin, methamphetamine, drug distribution materials, and $2,225 in currency. In the trunk they recovered a Sig Sauer Model P230 9mm Kurz semi-automatic pistol. Hiddleston is also prohibited from possessing firearms due to a domestic violence order.
The case was investigated by the Seattle Police Department, the Drug Enforcement Administration (DEA) and the Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF).
The case was prosecuted by Assistant United States Attorney Todd Greenberg.
Seal Beach Woman Sentenced to Nearly Three Years in Federal Prison for Operating Real Estate Scheme in Orange CountyRead the Press Release
SANTA ANA, California – A Seal Beach woman was sentenced today to 35 months in federal prison for operating a $1.4 million fraud scheme that bilked clients who paid money in response to false promises of ownership in commercial real estate.
Karen Hanover, 48, was sentenced by United States District Judge Josephine Staton, who scheduled a May 8 hearing to determine how much restitution should be paid to approximately 45 victims.
Hanover pleaded guilty last year to one count of mail fraud related to the scheme she ran out of two Long Beach companies – Commercial Investment Education LLC and Kharmic Life Strategies Inc. Hanover pitched her “Fast Track” investment program to investors who attended seminars in Southern California, Dallas and Las Vegas, Nevada.
Victims were induced to invest between $19,000 and $29,000 in the real estate scam. In her pitches, Hanover “falsely represented to the ‘Fast Trackers’ that she would partner with them in real estate deals, they would receive 100 percent returns on their investments, and she would provide a 100 percent refund if they did not obtain a commercial property within a year,” according to court documents that noted these promises were false.
In sentencing papers filed with the court, prosecutors described how some victims invested borrowed money or all of their savings based on Hanover’s purported “guarantees.” When victims demanded the return of their money, Hanover engaged in “bullying and intimidation” – tactics that Judge Staton noted during today’s hearing when she said Hanover caused substantial harm, which was aggravated by threatening victims with jail time if they reported her.
Previously in this investigation, Hanover was found guilty at trial in October 2011 of impersonating an FBI agent for contacting the victims of her fraud scheme, using a telephone number designed to appear to be associated with the FBI and threatening them with arrest if they told others about her fraudulent conduct (for background see: http://www.fbi.gov/losangeles/press-releases/2011/la021011.htm). As a result of this separate case, Hanover was sentenced to six months in prison and ordered to pay a $5,000 fine.
This investigation was conducted by the FBI.
Release No. 15-016
Schuyler Man Charged with Distributing Methamphetamine Facing up to 40 years in PrisonRead the Press Release
United States Attorney Deborah R. Gilg announced the unsealing of a 3 count Indictment charging Jose J. Nevarez, age 43, of Schuyler, Nebraska, with distributing methamphetamine. The maximum possible penalty for the offenses includes not less than 5 years and up to 40 imprisonment, a fine of up to $5 million, a term of supervised release of at least 4 years, and a $100 special assessment.
The Indictment alleges that on 3 separate dates, Nevarez distributed more than 5 grams of actual methamphetamine in Schuyler, Nebraska. Nevares is scheduled for his initial appearance in Federal District Court in Omaha on Monday February 23, 2015.
This case was the result of an investigation by the Nebraska State Patrol.
Rothstein Associate Sentenced in Connection with Rothstein CaseRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), and George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, announce that Frank Preve, 71, of Coral Springs, was sentenced today in Ft. Lauderdale by United States District Judge James I. Cohn to 42 months in prison, to be followed by two years of supervised release. On August 19, 2014, Preve pled guilty to conspiracy to commit wire fraud in connection with the operation of the former Fort Lauderdale law firm of Rothstein, Rosenfeldt and Adler, P.A. (RRA).
In 2009, it was discovered that RRA was being utilized by its Chairman and Chief Executive Officer, Scott W. Rothstein, to commit a massive Ponzi scheme stemming from the sale of fictitious confidential settlements. In a written factual stipulation filed in connection with his guilty plea, Preve admitted that he worked for a number of companies, referred to as “the Banyon Group,” which solicited lenders and investors into the confidential settlement business being offered by Rothstein. The defendant further admitted that, from on or about July 9, 2009 through October 31, 2009, he defrauded investors by not disclosing that Rothstein had failed to make payments that were due to the Banyon Group, that Rothstein had frozen certain bank accounts that were holding investor funds, that certain paperwork was not being prepared, and that verification of the investments was not taking place, all in violation of a private placement memorandum which had been circulated to potential investors by the Banyon Group. The defendant further admitted that, through these material misrepresentations and omissions, Preve caused more than $20 million to be paid by investors to the Banyon Group.
Mr. Ferrer commended the investigative efforts of the IRS-CI and the FBI. This case was prosecuted by Assistant U.S. Attorneys Lawrence D. LaVecchio, Paul F. Schwartz, and Jeffrey N. Kaplan.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Roseville Man Sentenced to 84 Months for Possession of Child PornographyRead the Press Release
SACRAMENTO, Calif. — Daniel Harrison McGrath, 60, resident of Roseville, California, was sentenced today by United States District Judge Garland E. Burrell, Jr. to 7 years in prison for possession of child pornography, United States Attorney Benjamin B. Wagner announced.
According to court documents, during an unrelated investigation, McGrath told investigating officers that he had images of child pornography on his computer. A subsequent search identified more than 3,000 images and videos of child pornography on McGrath’s computer and on multiple CDs created by McGrath. Some of the images showed prepubescent children, sadistic and masochistic conduct, and infants.
This case was the product of an investigation by the City of Roseville Police Department, the Sacramento County Sheriff’s Department, and the Federal Bureau of Investigation. Assistant United States Attorneys Todd A. Pickles and Kyle Reardon prosecuted the case.
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 those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about Internet safety education.
Rochester, New York - Man was Indicted by a Northern District of New York Grand Jury on One Count of Bank Robbery.Read the Press Release
Robbery of Summit Federal Credit Union in Syracuse Took Place in Broad Daylight
SYRACUSE, NEW YORK
RONALD REID (52) of Rochester, New York, was indicted by a Northern District of New York Grand Jury on one count of bank robbery, announces United States Attorney Richard S. Hartunian.
According to the Indictment, the defendant robbed the Summit Federal Credit Union on Erie Boulevard East in Syracuse on January 26, 2015, by demanding money from a teller. The crime allegedly occurred just before 1:00 pm. If convicted of bank robbery, Reid faces up to twenty years in prison.
The charges and allegations in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
This case is being investigated by the Federal Bureau of Investigation and the Syracuse Police Department. The case is being prosecuted by Assistant United States Attorney Michael F. Perry. Please direct press inquiries to Executive Assistant U.S. Attorney John Duncan at 315-448-0672.
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Perry County Resident Pleads Guilty to Methamphetamine OffenseRead the Press Release
On February 19, 2015, Stephanie A. Ellis, 36, DuQuoin, Ill., pled guilty to a one-count indictment, charging conspiracy to manufacture methamphetamine, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
The indictment alleges that the offense occurred between 2012 and September 2014, in Perry, Jackson, Randolph, Williamson, and Franklin Counties. Evidence at the plea hearing established that Ellis was involved with others in the manufacture of methamphetamine. Four co-defendants have previously pled guilty to their role in the methamphetamine conspiracy and are awaiting sentencing. Two co-defendants have pled not guilty and are awaiting jury trial. Ellis is currently being held without bond pending a June 18, 2015, sentencing hearing.
The offense carries a possible prison term of up to 20 years, to be followed by 3 years’supervised release, and a $1,000,000 fine.
The ongoing investigation is being conducted by the Jackson County Sheriff’s Office, Perry County Sheriff’s Office, Perry County Drug Task Force, Murphysboro Police Department, and DuQuoin Police Department. The Pinckneyville Police Department and Illinois State Police Methamphetamine Response Team assisted in the investigation.
The case is assigned to Assistant United States Attorney Amanda A. Robertson for prosecution.
Perry County Resident Charged with Methamphetamine ConspiracyRead the Press Release
Jamie M. Trzinski, 28, of DuQuoin, was indicted on February 3, 2015, in a one-count indictment, charging conspiracy to manufacture methamphetamine, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
The indictment alleges that the offense occurred between 2012 and December 2014, in Perry, Jackson, and Randolph Franklin Counties. Trzinski made her initial appearance in federal court in Benton on February 19, 2015. At a February 20, 2015, bond hearing, Trzinski was ordered held without bond pending an April 20, 2015, jury trial.
An indictment is a formal charge against a defendant. Under the law, a defendant is presumed to be innocent of a charge until proved guilty beyond a reasonable doubt to the satisfaction of a jury.
The methamphetamine offense carries a maximum penalty of up to 20 years in prison, to be followed by 3 years’ supervised release, and a $1,000,000 fine.
The ongoing investigation is being conducted by the Perry County Sheriff’s Office, Jackson County Sheriff’s Office, Perry County Drug Task Force, Murphysboro Police Department, and DuQuoin Police Department. The Pinckneyville Police Department and Illinois State Police Methamphetamine Response Team assisted in the investigation.
The case is assigned to Assistant United States Attorney Amanda A. Robertson for prosecution.
Olin Man Pleads Guilty to Mail Fraud and Using Fire to Commit A Federal FelonyRead the Press Release
A man who submitted a fraudulent insurance claim after deliberately setting fire to his vacant home pled guilty today in federal court in Cedar Rapids.
James Marvin Plower, age 50, from Olin, Iowa, was convicted of one count of mail fraud and one count of using fire to commit a federal felony.
At the plea hearing, Plower admitted that, between about July 2013 and August 2014, he made upon a scheme to defraud his insurance company. Plower admitted that, as part of the scheme, he deliberately set fire to his vacant home in Martelle, Iowa, and then submitted an insurance claim in which he falsely claimed the fire was accidental. Plower also admitted that, as part of the scheme, he caused the insurance company to mail him a check for $66,497.46.
Sentencing before United States District Court Chief Judge Linda R. Reade will be set after a presentence report is prepared. Plower was released on bond pending sentencing. Plower faces a mandatory minimum sentence of 10 years’ imprisonment and a possible maximum sentence of 30 years’ imprisonment, a $250,000 fine, $200 in special assessments, and up to 6 years of supervised release following any imprisonment.
The case is being prosecuted by Assistant United States Attorney Peter Deegan and was investigated by Iowa Division of Criminal Investigation, United States Postal Inspection Service, Iowa State Fire Marshal Division, and the Jones County Sheriff’s Department.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 15-CR-12-LRR.
Follow us on Twitter @USAO_NDIA.
Notice of SentencingRead the Press Release
Contact Person: Beth Drake (803) 929-3000
Columbia, South Carolina ---- United States Attorney Bill Nettles announced today that there will be a sentencing hearing Monday (February 23, 2015) in United States v. Warren Dominique McDaniel. The hearing will be held at 2:30 pm on Monday, February 23, 2015, before United States District Judge Michelle Childs (Courtroom # 2) at the Matthew J. Perry Federal Courthouse in Columbia, South Carolina.
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North Texas Man Indicted for False Statements While Under OathRead the Press Release
Department of Justice
Office of Public AffairsTYLER, Texas – U.S. Attorney John M. Bales announced today that a former executive has been indicted for making false declarations before court in a civil trade secrets case in the Eastern District of Texas.
Albert Davis, 54, formerly of Richardson, Texas, was arrested on Feb. 19, 2015 in Lewisville, Texas on a federal arrest warrant issued by the Eastern District of Texas and the Western District of Missouri. Davis was recently charged in Missouri for his role in a fraud scheme in which a Dallas-area hospital paid more than $1 million to purchase an MRI machine from Davis and co-conspirators who impersonated representatives of Kansas City-based Cerner Corporation. Davis will have a detention hearing on Feb. 25, 2015.
Davis was indicted on Feb. 19, 2015 in Tyler on three counts of false declaration before court. The indictment alleges that on May 5, 2014, Davis, while under oath as a witness in a case being tried before the U.S. District Court for the Eastern District of Texas entitled, LBDS Holding Company, LLC vs. ISOL Technology, Inc. et al., Docket No. 6:11-CV-428, knowingly made false material declarations.
If convicted, Davis faces up to five years in federal prison for each count.
The investigation leading to the charges was conducted by agents from the Federal Bureau of Investigation and the U.S. Attorney's Office for the Western District of Missouri. Assistant U.S. Attorney Nathaniel C. Kummerfeld is prosecuting this case.
It is important to note that a grand jury indictment is not evidence of guilt.
New Ulm Felon Sentenced to 25 Years in Prison for Illegal Possession of Firearms and AmmunitionRead the Press Release
United States Attorney Andrew M. Luger announced the sentencing of BUCK OTTO WHITE a/k/a “TIMOTHY JOSEPH HOFFMAN,” 50, to 300 months in federal prison for illegally possessing stolen firearms and ammunition. WHITE was charged on April 7, 2014, with two counts of possession of firearms and ammunition by a convicted felon and two counts of possession of stolen firearms and ammunition. On April 25, 2014, following a three-day trial, a federal jury found WHITE guilty on all counts. The defendant was sentenced on February 13, 2015, before Judge Joan N. Ericksen in U.S. District Court in Minneapolis, Minn.
“Buck White is a career felon,” said Assistant U.S. Attorney Bradley Endicott. “As a result of his prior convictions, Mr. White cannot legally possess firearms. He is now facing 25 years in prison for his repeated illegal activity. This conviction would not have been possible without the investigative efforts of the ATF and our local partners in the New Ulm Police Department and Nicollet County Sheriff’s Office.”
As proven at trial, WHITE illegally possessed numerous firearms at a storage unit in Courtland, Minn., which included two rifles and two shotguns, as well as 140 rounds of ammunition. All of the firearms and ammunition were stolen during the course of a residential burglary in a nearby town. WHITE also illegally had a rifle and various stolen ammunition at his home in New Ulm, Minn.
During the pendency of his court proceedings, WHITE was released to a treatment facility and ordered to wear a location monitoring bracelet. The defendant on July 22, 2013, removed the GPS monitoring bracelet, fled the facility, and remained a fugitive until the U.S. Marshals arrested him on January 15, 2014. During the arrest, WHITE attempted to flee, leading officers on a high-speed car chase in a densely populated area of Minneapolis, Minn.
This case resulted from an investigation conducted by the New Ulm Police Department, the Nicollet County Sheriff’s Office, and the United States Bureau of Alcohol, Tobacco, Firearms and Explosives.
This case was prosecuted by Assistant U.S. Attorneys Bradley M. Endicott and John R. Marti.
Defendant Information:
BUCK OTTO WHITE, a/k/a “TIMOTHY JOSEPH HOFFMAN,” 50
New Ulm, Minn.
Convicted:
• Armed Career Criminal in Possession of Firearm, 1 count
• Armed Career Criminal in Possession of Ammunition, 1 count
• Possession of Stolen Firearms, 1 count
• Possession of Stolen Ammunition, 1 count
Sentenced:
• 300 months in prison
• 5 years of supervised releaseNew Smyrna Man Sentenced to Federal Prison for Trafficking in FirearmsRead the Press Release
Orlando, Florida – U.S. District Judge Roy B. Dalton, Jr. yesterday sentenced Michael Alvin Carter (61, New Smyrna Beach) to 51 months in federal prison for knowingly selling firearms to a convicted felon and knowingly selling stolen firearms. The Court also ordered him to forfeit the firearms he had sold, specifically a Norinco SKS rifle, a Ruger Mini-14 rifle, a Mossberg 500A shotgun, a Yugo M58/66 7.62 caliber rifle, an H&R shotgun, a Magnum Research Desert Eagle .50 caliber handgun, a Ruger .357 SP101 revolver, and a Smith & Wesson Model 642-2 Lady Smith revolver.
Carter pleaded guilty on November 25, 2014.
According to court documents, in June 2012, Carter sold six firearms to a person that he knew was a convicted felon, but who, unbeknownst to Carter, was working with the FBI. A few weeks later, Carter sold two additional firearms that he knew had been stolen to an FBI undercover officer. During the sentencing hearing, the Court found that Carter had known that firearms he was selling would be used unlawfully by other persons.
This case was investigated by the Federal Bureau of Investigation. It was prosecuted by Assistant United States Attorney Bruce S. Ambrose.
Nebraska “Sovereign Citizen” Sentenced for Obstructing Internal Revenue Service and Filing False Property Liens Against Federal OfficialsRead the Press Release
A La Vista, Nebraska, woman was sentenced today in U.S. District Court for the District of Nebraska in Omaha to serve 36 months in prison and three years of supervised release for tax obstruction, filing a false claim and filing false retaliatory property liens, Principal Deputy Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division announced.
Donna Marie Kozak, a former college instructor, was convicted by a jury on Aug. 1, 2014, on all nine counts charged in the superseding indictment. At trial, the evidence showed that in 1997, Kozak stopped filing income tax returns, and from 1997 through 2012, she obstructed the Internal Revenue Service (IRS) by hiding assets, applying for tax-exempt status for a sham entity, filing a false claim for a tax refund, sending harassing correspondence to IRS agents, and filing false liens against an IRS-Criminal Investigation special agent and others.
In about 2009, Kozak joined the “Republic for the united States of America,” a sovereign citizen group, and was the group’s designated “governor of Nebraska.” In 2012 and 2013, Kozak and Georgia resident Randall Due conspired to file false liens in retaliation for the federal criminal tax prosecution and trial convictions of associates David and Bernita Kleensang. In furtherance of the conspiracy, Kozak and Due filed a false lien for $19 million on property located in Boyd County, Nebraska, that was owned by the federal U.S. District Court judge who presided over the Kleensang trial. After Kozak was indicted by a federal grand jury for the criminal tax charges and while on pre-trial release, she filed five more false liens on properties owned by another federal U.S. District Court judge, the U.S. Attorney for the District of Nebraska, two Assistant U.S. Attorneys and an IRS-Criminal Investigation special agent. Due was tried and convicted in the District of Nebraska on related charges on Sept. 4, 2014.
Principal Deputy Assistant Attorney General Ciraolo commended the special agents of the FBI and IRS-Criminal Investigation who investigated the case and Trial Attorneys Brian Bailey and Matthew Hoffman of the Tax Division, who prosecuted the case.
Navajo Man Pleads Guilty to Federal Involuntary Manslaughter ChargeRead the Press Release
ALBUQUERQUE – Berland Thomas, 44, an enrolled member of the Navajo Nation who resides in Mexican Springs, N.M., pled guilty this morning to a felony information charging him with involuntary manslaughter.
Thomas was arrested on June 9, 2014, on a criminal complaint charging him with murder. According to the complaint, Thomas allegedly killed a Navajo man by beating him with his fists during an alcohol-fueled fight. The fight occurred on June 6, 2014, on the Navajo Indian Reservation in McKinley County, N.M. Thomas was subsequently indicted on June 24, 2014, and charged with second degree murder.
During today’s change of plea hearing, Thomas pled guilty to an involuntary manslaughter charge and admitted assaulting the victim by striking, beating and wounding him. Thomas acknowledged that the victim died as a result of injuries suffered during the assault.
Under the terms of his plea agreement, Thomas will be sentenced to a term of imprisonment in the range of 18 to 24 months followed by a period of supervised release to be determined by the court. Thomas remains in custody pending his sentencing hearing, which has yet to be scheduled.
This case was investigated by the Gallup office of the FBI and the Crownpoint office of the Navajo Nation Division of Public Safety. Assistant U.S. Attorney Kyle T. Nayback is prosecuting the case.
Murphysboro Resident Sentenced for Methamphetamine and Crack Cocaine OffensesRead the Press Release
On February 19, 2015, Harold Lawayne Barron, a/k/a “Wayne,” 51, of Murphysboro, Ill., was sentenced for his involvement in a methamphetamine conspiracy and a crack cocaine conspiracy, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
Barron, who had previously pled guilty to the two-count indictment charging conspiracy to manufacture methamphetamine and conspiracy to distribute crack cocaine, was sentenced to 156 months in prison, 3 years’ supervised release, and was fined $400. Evidence at the plea and sentencing hearings established that Barron was involved with Jamie Kay Kelly, a/k/a “Jamie K.” and others in the manufacture of methamphetamine. The methamphetamine offense occurred between August 2012, and October 2013, in Jackson and Perry Counties. Barron was involved with Kelly and Maurice L. Robinson, a/k/a “Ray Ray,” and others in the distribution of crack cocaine. The crack cocaine offense occurred between May 2013, and September 2013, in Jackson County. At sentencing, the district court found that Barron’s offenses involved at least 177 grams of pseudoephedrine and 64 grams of crack cocaine. Kelly and Robinson were previously sentenced to imprisonment terms of 84 months and 87 months, respectively, for their roles in the drug offenses.
The ongoing investigation is being conducted by the Jackson County Sheriff’s Office, Southern Illinois Enforcement Group, Murphysboro Police Department, Illinois State Police, and the Drug Enforcement Administration. The Jackson County State’s Attorney’s Office assisted in the investigation.
The case was assigned to Assistant United States Attorney Amanda A. Robertson for prosecution.
Muncie man sentenced to 50 years for production of child pornographyRead the Press Release
Indianapolis – Josh J. Minkler, Acting United States Attorney, announced today that a Muncie man was sentenced in federal court for his role in the production and distribution of child pornography. Joel D. Hilton, 42, Muncie, was sentenced to 50 year by U.S. District Judge Tanya Walton Pratt.
“Protecting our innocent children from internet predators will remain a top priority of our office,” said Minkler. “Producing and distributing pornography re-victimizes our children every time it is passed from one person to another.”
In July 2014, agents from Homeland Security Investigations (HSI) and the Hamilton County Metro Child Exploitation Task Force (HCMCETF) received information a website that Hilton had access to, was being used to trade child pornography. Investigators examined the photographs and determined from the background, that many of the pictures were taken in Muncie, Indiana. Further investigation determined the victims were sisters, between seven and eight years old and Hilton had produced pornographic images by photographing the victims in sexually explicit activities. He would then post the images to a website to be traded with others in his networking group.
Investigators went to Hilton’s Muncie home to interview him and noticed a tattoo on his hand, similar to those depicted on internet pornographic photos. He was then placed under arrest. Law enforcement also confiscated several electronic devices used to produce and distribute the pornography.
Minkler praised the two investigative agencies, noting the arrest of Hilton was made less than six hours after authorities learned of his identity, saving many more potential victims.
This case was jointly investigated by Homeland Security Investigations and the Hamilton County Metropolitan Child Exploitation Task Force.
“The lengthy prison term in this case is well deserved," said Gary Hartwig, special agent in charge of HSI Chicago. "This individual manipulated and preyed upon vulnerable children for his own twisted sexual gratification. In doing so, he stole their innocence. HSI must and will do everything in our power to protect our children and bring those involved in these despicable crimes to justice.”
Andy Dietz, Director of the HCMCETF said, “This case underscores the value of having well trained investigators working together, and in cooperation across international boundaries focused on a single mission. The safety of our children is paramount and we will work with all of our local, state and federal partners to track down anyone who preys on the innocent.”
According to Senior Litigation Counsel Steven D. DeBrota, who prosecuted this case for the government, Hilton has multiple prior convictions for sex crimes and faces lifetime supervised release after serving his sentence.
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 http://www.justice.gov/publications/psc. For more information about internet safety education, please visit http://www.justice.gov/psc/resources.
Mt. Morris Man Sentenced in Child Pornography CaseRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051ROCHESTER, N.Y. – U.S. Attorney William J. Hochul, Jr. announced today that Patrick Welch, 59, of Mt. Morris, NY, who was convicted of possession of child pornography, receipt of child pornography and distribution of child pornography, was sentenced to 240 months in prison and 10 years supervised release by U.S. District Judge Charles J. Siragusa. Due to a prior conviction, the charges carry a mandatory minimum penalty of 15 years in prison, a maximum of 40 years and a fine of $250,000.
Assistant U.S. Attorney Tiffany H. Lee, who handled the case, stated that on May 13, 2013, the Livingston County Sheriff's Office received a lead from the Los Angeles County Sheriff's Office concerning a potential child exploitation case. A Los Angeles County Sheriff's investigator had received a cyber tip from the National Center for Missing and Exploited Children that two individuals appeared to be chatting about and trading child pornography on a certain internet site. Both individuals purported to be teenaged boys.
One of the individuals chatting used the screen name "David D." A search warrant was executed on the provided email account and images of child pornography were found. The internet protocol address for "David D" was registered to Welch's address on Scipio Road in Mt. Morris. After a search warrant was executed at the defendant's residence, a forensic review of one of Welch's computers was conducted and images of child pornography were found.
In 2003, the defendant was convicted in Livingston County of sexual conduct against a child and, following his conviction, he was required to register as a sex offender.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by 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 better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The sentencing is the culmination of an investigation on the part of Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent in Charge James C. Spero, the Livingston County Sheriff's Department, under the direction of Sheriff Thomas J. Dougherty, and the Los Angeles County Sheriff's Department, under the direction of John L. Scott.
Milledgeville Couple Found Guilty of Tax FraudRead the Press Release
ATLANTA - Kenneth Horner and his wife Kimberly Horner have been found guilty of tax fraud following a three-day jury trial for skimming more than $1.5 million in cash from their business without disclosing the income.
“This jury recognized the defendants’ handling of cash for what it really was: a ploy to avoid disclosing income and paying taxes,” said Acting U.S. Attorney John Horn.
“In willfully failing to report their total business income to the IRS, the Horners cheated the system and dodged the same basic responsibility that millions of other business owners comply with every year: fairly and honestly reporting their earnings,” said Principal Deputy Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division. “Today’s verdict establishes that those who engage in such criminal conduct will be held accountable. The Tax Division is committed to working with its law enforcement partners to identify, investigate and vigorously prosecute these offenders.”
“At this time of year, when hard-working citizens are sitting down to prepare their tax returns, it is especially disappointing to see the overt steps some individuals will take to hide their taxable funds from the government,” stated Veronica F. Hyman-Pillot, Special Agent in Charge, IRS Criminal Investigation. “Taxpayers deserve our vigilance in the investigation and prosecution of individuals who willfully underreport their income and evade the payment of their fair share of taxes.”
According to Acting United States Attorney Horn, the charges and other information presented in court: Kenneth and Kimberly Horner owned Topcat Towing and Recovery, Inc. (“Topcat Towing”), a towing business in Lithonia, Georgia. Between 2005 and 2008, Topcat Towing had an exclusive contract with DeKalb County, Georgia, for all county car tows needed from the south precinct of the county. Between 2005 and 2008, the defendants skimmed more than $1.5 million in cash receipts from their towing business and deposited those cash receipts into their personal bank account without disclosing the income to their tax return preparer or on corporate and personal tax returns filed with the IRS. The defendants tried to conceal their cash deposits from the government by “structuring” their deposits, which is the act of splitting up cash deposits that exceed $10,000 for the purpose of evading a Currency Transaction Report from being filed.
Most financial institutions, including banks, are generally required to file Currency Transaction Reports (CTRs) for cash transactions that exceed $10,000. CTRs are submitted to the U.S. Department of Treasury. In 2007 and 2008, the defendants used their unreported cash, in part, to build a custom home in Conyers that was appraised at more than $900,000. The defendants owe approximately $400,000 in taxes to the IRS for their unreported income.
The defendants were charged with filing false corporate and personal tax returns for the years 2007 and 2008. They were convicted of all four counts charged.
Sentencing for Kenneth Horner, 58, and Kimberly Horner, 53, both of Milledgeville, Georgia, is scheduled for May 6, 2015, at 10:00 a.m. before U.S. District Judge Timothy C. Batten Sr.
This case is being investigated by the Internal Revenue Service Criminal Investigation.
DOJ Criminal Tax Division Trial Attorney Christopher J. Maietta and Assistant U.S. Attorney Steven D. Grimberg are prosecuting the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao/gan/.
Miami Gardens Resident Convicted in Shooting of Miami Gardens Police OfficerRead the Press Release
On January 11, 2014, what began as a routine response to the scene of a fight at a Miami Gardens apartment complex ended in a dramatic firefight when Randy Thomas, 45, opened fire on a 25-year old police officer with Miami Gardens Police Department. Following a three-day trial, a federal jury convicted defendant Randy Thomas of being a felon in possession of a firearm.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Stephen E. Johnson, Chief, Miami Gardens Police Department, Hugo J. Barrera, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Miami Field Division, made the announcement.
Following a call to 911, two police officers with Miami Gardens Police Department responded to the scene of a fight between Thomas and two women at an apartment complex. While one officer diverted his attention to the females, the second officer attended to Thomas, who had begun walking away. The officer testified that he was unaware that Thomas was armed as he casually approached Thomas and asked him to stop. The officer then recounted how Thomas spun around with a pistol in his hand and pointed it at the officer who was just four feet away. The evidence at trial also included a surveillance video that showed Thomas abruptly turning with his arm extended and then chasing after the officer.
A bystander described in chilling detail how the officer stepped back in shock when Thomas pulled a gun from his waistband and began to chase and shoot at the officer. The officer sought safety while retrieving his own firearm. The officer fired several shots at Thomas in an attempt to disarm Thomas. Undeterred, Thomas chased down the officer, and fired several shots at him, striking the officer in the leg and causing him to collapse on the sidewalk. The second officer testified that he witnessed the entire altercation and discharged his own firearm when he saw Thomas chasing and shooting at the officer. Yet another officer, who arrived at the moment of the shooting, testified that she pulled up in a patrol car at the precise moment of the shooting, and saw Thomas standing with his arm extended and shooting at the fallen officer.
Forensic analysis helped link the firearm to Thomas. The officer, who sustained a bullet wound to the thigh and received medical treatment at Ryder Trauma, has since recovered fully from his injuries.
At sentencing, which is currently set for April 24, 2015, at 2:00 p.m., Thomas faces a minimum of 15 years imprisonment and a maximum of a life sentence for his conviction of the federal crime of being a felon in possession of firearm. He also faces prosecution in a state case in which he is charged with attempted murder of a law enforcement officer.
Mr. Ferrer commended the Miami Gardens Police Department for their efforts in the investigation of this case. Mr. Ferrer also thanked the Bureau of Alcohol Tobacco and Firearms for their assistance and cooperation in this matter. This case was prosecuted by Assistant U.S. Attorney Cristina Moreno and Francisco Maderal.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Merritt Island Man Sentenced to More Than Six Years for Possession and Receipt of Child PornographyRead the Press Release
Orlando, Florida – U.S. District Judge Roy B. Dalton, Jr. has sentenced James Otis Liptak (36, Merritt Island) to six years and six months in federal prison for receipt and possession of child pornography. The Court also ordered him to forfeit specific computers and hard drives on which the images of child pornography had been found. Liptak pleaded guilty on October 22, 2014.
According to court documents, on July 25, 2014, a Brevard County Deputy Sheriff and FBI Task Force Agent assigned to the Child Exploitation Task Force determined that someone using a computer with a specific Internet Protocol (IP) address was advertising suspected child pornography through a peer-to-peer file sharing program. Further investigation revealed that the computer was located at a residence in Merritt Island, Florida. Agents subsequently executed a federal search warrant at the house and found computers in Liptak’s bedroom. During an interview with agents, Liptak admitted that he had searched the Internet for the images and movies, and that he had stored them on his computer. A forensic examination of the computer’s hard drives revealed more than 5,000 images and 113 movies of child pornography.
This case was investigated by the Federal Bureau of Investigation and the Brevard County Sheriff’s Office Child Exploitation Task Force. It was prosecuted by Assistant United States Attorney Bruce S. Ambrose.
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.justice.gov/psc
Medical Drug Re-Packager and Company’s Senior Executives Indicted on Fraud Charges and Criminal Violations of the Food, Drug and Cosmetic ActRead the Press Release
Earlier today, a 37-count indictment was unsealed in Brooklyn federal court charging Med Prep Consulting, Inc. (“Med Prep”), a Tinton Falls, New Jersey, medical drug re-packager and processer, together with its president and owner Gerald Tighe and pharmacist-in- charge Stephen Kalinoski, with wire fraud and violations of the Federal Food, Drug and Cosmetic Act (“FDCA”) for introducing adulterated and misbranded drugs into interstate commerce with the intent to defraud and mislead the U.S. Food and Drug Administration (“FDA”) and Med Prep’s customers, who consisted of hospitals and other healthcare providers.1
The charges were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, and Margaret A. Hamburg, M.D., Commissioner of the FDA.
According to the indictment, Med Prep processed numerous drugs, including oncology and dialysis drugs, pain medications, anesthesia drugs, and operating room drugs, in purportedly sterile conditions. In an effort to gain market share, Med Prep repeatedly misrepresented to its healthcare provider customers that it adhered to, and in some areas exceeded, industry standards and laws applicable to sterile drug preparation. In fact, the defendants produced drugs in a facility that fell far short of basic industry standards of cleanliness, creating a risk to the health of already ill patients, and lied to healthcare providers about their failures to comply with basic sterility practices.
“As detailed in the indictment, Med Prep and its two most senior executives engaged in a disturbing pattern of dangerous practices in order to save money and line their pockets,” said U.S. Attorney Lynch. “Instead of working to extend and enhance human lives, the defendants illegally pursued corporate profits while putting at risk the health and safety of vulnerable patients suffering from disease. This indictment should send a strong message to those who would seek to put their bottom line before the health and safety of the public – those we entrust with preparing the medications that save lives must clean up their acts or face prosecution.” In announcing the indictment today, Ms. Lynch gratefully acknowledged the assistance and cooperation of the FDA’s Office of Criminal Investigations; the United States Department of Health and Human Services, Office of the Inspector General, Office of Investigations; the United States Office of Personnel Management, Office of the Inspector General; the Department of Justice, Civil Division, Consumer Protection Branch and Commercial Litigation Branch; the FDA’s Office of the Chief Counsel; the Office of the Attorney General of New Jersey; and the New Jersey Board of Pharmacy.
“The production of unsafe and contaminated drug products poses a serious threat to the health of the American public and cannot be tolerated,” said FDA Commissioner Hamburg. “We continue to use all our authorities and to work with the Department of Justice and the states to ensure such practices are quickly identified and stopped. Americans deserve nothing less.”
According to the indictment, Med Prep halted its production of drug products in the summer of 2013 following an incident in which it had distributed intravenous drugs containing visible mold to a Connecticut hospital. Soon after mold was discovered, the FDA inspected Med Prep’s facility and documented numerous incidents of microbiological contamination in the company’s finished drug products. Notably, the investigators found that the same species of mold present in drugs sent to the Connecticut hospital was also present in Med Prep’s warehouse, where an unsterilized cart was regularly wheeled into a purportedly sterile “cleanroom” in which drugs were prepared by Med Prep employees. FDA investigators also found that Med Prep shipped drug products to healthcare providers in some instances that were mislabeled with incorrect drug strengths and in other instances were labeled as the wrong drugs altogether.
Prior to 2013, the FDA had conducted several inspections of Med Prep’s facilities and repeatedly warned the defendants that their practices and the conditions in their facility were unacceptable. Tighe and Kalinoski both allegedly misrepresented to FDA investigators that Med Prep’s complied with industry standards designed to prevent harm to patients that could result from non-sterility, yet they continued to handle sterile drugs in conditions far below any acceptable industry standards. As early as May 2007, Kalinoski learned that a Med Prep employee responsible for repacking and processing drugs in Med Prep’s “cleanroom” failed to treat an eczema skin condition for approximately five to six months while working in that room. The defendants never disclosed the employee’s skin condition to the FDA, nor did they take steps to prevent the delivery to, or issue a recall from, healthcare providers of any of the drug products with which the employee had come into contact.
If convicted, the individual defendants face maximum prison sentences of 20 years on each wire fraud charge, five years on the charge of conspiracy to violate the FDCA, and three years on each charge of violations of the FDCA.
The government’s case is being prosecuted by Assistant U.S. Attorneys Justin D. Lerer, Ameet B. Kabrawala, and Erin E. Argo.
1 The charges in the indictment are merely allegations, and the defendants are presumed innocent unless and until proven guilty.
The Defendants:
MED PREP CONSULTING, INC.
Tinton Falls, New Jersey
GERALD TIGHE
Age: 57
West Long Branch, New Jersey
STEPHEN KALINOSKI
Age: 51
Middletown, New Jersey
Maryland Man Sentenced for Sexual Exploitation of a Child in TexasRead the Press Release
Department of Justice
Office of Public AffairsBEAUMONT, Texas – A 27-year-old California, Maryland man has been sentenced to federal prison for child exploitation violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Felix Alexandro Pinto, Jr., pleaded guilty on Oct. 10, 2014, to transporting a minor with intent to engage in criminal sexual activity and was sentenced to 144 months in federal prison today by U.S. District Judge Marcia A. Crone.
According to information presented in court, on May 25, 2011, Pinto was pulled over for a traffic violation in Harrison County, Mississippi. During the stop, the deputy noticed the passengers, a male and female, appeared extremely nervous. Pinto advised the deputy that he had driven from Maryland to Houston and was returning to Maryland. The vehicle had been rented by Pinto in Maryland at 8:00 am the day before, approximately 30 hours before the traffic stop. While interviewing the female passenger, the deputy learned she was a 14-year-old runaway from Liberty County, Texas. As she was being transported back to Texas, the girl reported that Pinto had sexually assaulted her. This was confirmed by a sexual assault nurse’s examination (SANE) in Beaumont, Texas. Further investigation revealed Pinto met the girl through a social media website. They communicated by the internet and cellular telephone networks for about two months before Pinto drove to Liberty County and picked the girl up from school on May 25, 2011. During this time, Pinto sent the girl sexually explicit photos of himself and asked her to send similar photos of herself to him. At one point the girl asked Pinto if her only being 14 years old would be a problem and he replied it would not. A forensic examination of the girl’s cell phone confirmed the conversations and photos.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by 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 better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case was investigated by the Federal Bureau of Investigation, Harrison County, Mississippi, Sheriff’s Office, and Liberty County, Texas, Sheriff’s Office and prosecuted by Assistant U.S. Attorney Randall L. Fluke.Manassas Man Pleads Guilty to Heroin TraffickingRead the Press Release
ALEXANDRIA, Va. – On the eve of trial, Bryan Christopher Samuel, 38, of Manassas, Virginia, pleaded guilty last night to conspiracy to distribute 700 grams or more of heroin and possession of a firearm in furtherance of a drug trafficking crime.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:14CR351.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia, and Andrew G. McCabe, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after the plea was accepted by U.S. District Judge T.S. Ellis, III.
Samuel was most recently indicted by a federal grand jury on December 16, 2014. He faces a mandatory minimum penalty of 15 years in prison and a maximum penalty of life in prison. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
According to the statement of facts filed along with the plea agreement, Samuel obtained distribution quantities of heroin from various sources of supply around the D.C. metro area as well as the I-95 corridor. Typically, Samuel and his co-conspirators would repackage the larger quantities of heroin purchased into individual user amounts, which they would then sell throughout Prince William County, Virginia. In addition, Samuel possessed a firearm, which he used for protection once he began buying and selling larger quantities of narcotics as well as during the robbery of a perceived rival drug dealer.
This case was investigated by the FBI’s Washington Field Office with assistance from the Manassas City Police Department. Special Assistant United States Attorneys John Taddei and Elizabeth Eriksen, and Assistant U.S. Attorney Zach Terwilliger are prosecuting the case.Man Responsible for Placing Explosive Type Device at Colorado Springs Building ArrestedRead the Press Release
Click here for a copy of the Criminal Complaint and Affidavit charging Thaddeus Murphy
DENVER – Thaddeus Cheyenne Murphy, age 44, of Colorado Springs, Colorado, was arrested late yesterday on charges of arson and being a felon in possession of firearms, the U.S. Attorney’s Office, the FBI, ATF and Colorado Springs Police Department announced. Murphy is believed responsible for placing a device at 603 South El Paso Street in Colorado Springs. Murphy is scheduled to appear before U.S. Magistrate Judge Michael E. Hegarty at 2:00 p.m. this afternoon in the Arraj Federal Courthouse, 901 19th Street, where he will be advised of his rights and the charges pending against him. A detention hearing and preliminary hearing will be scheduled for a date to be set next week.
According to an affidavit in support of a Criminal Complaint, on January 6, 2015 at 10:48 am the Colorado Springs Police department received reports of an explosion at a building located at 603 South El Paso Street in Colorado Springs. Police officers responded, as did their bomb squad. Further, soon thereafter federal agents from the FBI and the ATF jointly responded to the scene to work with the police department in conducting the investigation. The device was a road flare and pipe bomb near a container of gasoline. The device was lit, causing an explosion. The gasoline did not ignite. The building and sidewalk were charred as a result of this device.
Multiple interviews were done by law enforcement of witnesses who noticed a specific type of truck and an individual fleeing the scene. Extensive investigation done by law enforcement eventually lead to the identification of a truck that closely matched the description of the truck fleeing the scene. Also, the person driving the truck generally resembled the sketch drawn by the Colorado Springs Police Department. After determining the individual’s identity, and developing probable cause that the owner of the truck, Thaddeus Murphy, was the likely person responsible for the device, federal agents working with the U.S. Attorney’s Office obtained a search warrant of the target’s home. While executing the warrant, agents and officers found seven firearms, and devices similar to the one used at the building. Murphy has prior felony convictions, which made it illegal for him to possess the firearms. Also during the search, Murphy was interviewed by federal law enforcement where he stated that the target of his criminal actions was not the NAACP, but that he had a different motive. The investigation continues regarding the motive for the attack. The residents of Colorado Springs, and the occupants of the building in question, can rest assured that the person who allegedly placed the device is now in custody.
Murphy is charged with one count of arson of a building. If convicted on that count, he faces not less than 5 years, and up to a $250,000 fine. He also faces one count of being a felon in possession of firearms. If convicted on that count, he faces not more than 10 years in federal prison, and up to a $250,000 fine.
This case is being jointly investigated by the FBI, ATF and the Colorado Springs Police Department with support from the El Paso County Sheriff’s Office.
The defendant is being prosecuted by Assistant U.S. Attorneys Gregory Holloway and Beth Gibson.
A Criminal Complaint is a probable cause charging document. Anyone accused of committing a felony violation of federal law has a Constitutional right to be indicted by a federal grand jury.
The charges in the Complaint are allegations, and the defendant is presumed innocent unless and until proven guilty.
Lummi Tribal Couple Sentenced to Prison for Dealing Heroin, Meth and Crack CocaineRead the Press Release
Two members of the Lummi Indian Tribe were sentenced today in U.S. District Court in Seattle to prison terms for conspiracy to distribute controlled substances, including heroin and methamphetamine, announced Acting U.S. Attorney Annette L. Hayes. TANYA JEFFERSON, 45, was sentenced to 18 months in prison, and her husband JOHN JEFFERSON, 37, was sentenced to 46 months in prison. Both were charged federally in August 2014, following an undercover investigation by the Lummi Police Department and the FBI. In November 2014, both entered guilty pleas admitting that on five different occasions in April 2013, the JEFFERSONs sold heroin or methamphetamine to a person working with law enforcement. At sentencing U.S. District Judge Richard A. Jones said, “Every time you sell drugs you impact someone’s life…. Anytime you introduce those drugs in your tribe, you don’t know what type of tailspin of addiction you have introduced.”
“Heroin and methamphetamine trafficking has no place in any of our communities, least of all on tribal lands,” said Acting U.S. Attorney Annette L. Hayes. “Heroin abuse is a growing problem in Western Washington and beyond, with an alarming increase in overdose deaths, especially among people under thirty. Last week I convened a heroin summit to focus community resources on battling what has become a growing epidemic of opioid abuse. I commend the work of our Tribal partners, the Lummi, to lead in the effort to prevent heroin use and overdose deaths.”
In partnership with Lummi public health agencies, Lummi Nation police officers are some of the first in Western Washington to be trained to recognize the symptoms of heroin or opioid prescription drug overdose and administer naloxone, an opioid blocker to help prevent needless overdose deaths in the community. In the first ten months of the program, officers have successfully administered naloxone in eleven overdose situations and saved lives that otherwise would have been lost.
JOHN JEFFERSON has a lengthy criminal history with 59 adult convictions for a range of offenses, including assault and battery, aggravated theft, violation of no-contact orders, and resisting arrest. His most recent conviction is for domestic violence against his wife, and in that case he attacked her to prevent her from calling the police. He also failed to complete his domestic violence treatment sessions. TANYA JEFFERSON has prior convictions for drug dealing and forgery. She is now barred by the tribe from the Lummi reservation because of her drug dealing.
The case was investigated by the Lummi Police Department and the FBI. The case was prosecuted by Assistant United States Attorney Jerrod Patterson.
Long Beach Man Who Ran Sex Trafficking Ring That Prostituted Young Women Sentenced to 20 Years in Federal PrisonRead the Press Release
LOS ANGELES – A Long Beach man was sentenced this morning to 20 years in federal prison for running a sex trafficking operation that victimized young women who he forced to work as prostitutes.
Roshaun Nakia Porter, 39, was sentenced today by U.S. District Judge Josephine L. Staton to a sentence of 240 months in prison, which will be followed by 10 years of supervised release.
In addition to the prison term, Judge Staton ordered Porter to pay $866,244 in restitution to 10 victims.
“Porter was the mastermind of a criminal enterprise who compelled numerous vulnerable women to surrender their bodies for considerable profit and personal sexual gratification,” federal prosecutors wrote in a sentencing memorandum filed with the court. “Porter’s callous and calculated conduct robbed his victims of their freedom, dignity and the proceeds of the illicit activities he compelled them to perform. For a period of almost two years, Porter engaged in calculated profiteering by enslaving and prostituting his victims.”
Porter pleaded guilty in July 2014 to conspiracy to engage in sex trafficking by force, fraud and coercion.
Porter’s co-defendant and protégé in the operation – Marquis Monte Horn, 40, also of Long Beach – was sentenced in October by Judge Staton to 78 months in prison after he pleaded guilty to conspiracy to engage in sex trafficking. Judge Staton also ordered Horn to pay $69,719 in restitution to one victim of the sex trafficking operation.
“Porter masterminded a reprehensible sex trafficking enterprise that caused extreme trauma and lasting injury to victims,” said Acting United States Attorney Stephanie Yonekura. “Over the course of nearly two years, Porter victimized young women with flagrant lies, bogus romantic overtures and acts of violence as he forced them to give up their bodies for his profit. This conduct is intolerable and warrants the lengthy sentence issued today by the court.”
David Bowdich, the Assistant Director in Charge of the FBI's Los Angeles Field Office, stated: “The defendant recruited unsuspecting victims as sex slaves through fraudulent promises of wealth and a better life. He then held them hostage by imposing physical beatings and issuing death threats while he cashed in on their suffering. The FBI is committed to protecting the civil rights of trafficking victims by identifying violent sexual offenders and pimps operating in our communities, and building federal cases to ensure they go to prison."
According to court documents and admissions in court, between 2010 and April 2012, Porter masterminded a scheme in which he exploited young women, including foreign nationals and U.S. citizens, by prostituting them in Orange County. Using various deceptive means – including false online personal advertisements posted on www.craigslist.com, www.modelmayhem.com and www.seekingarrangements.com – and fraudulent promises of legitimate employment, Porter reaped substantial illicit profits by luring his victims into personal relationships with him and, thereafter, compelling them to prostitute and provide him the proceeds from their commercial sex acts. To compel the victims into compliance, Porter used physical violence, psychological abuse, threats to harm the victims’ family members and other coercive means.
Horn admitted that between December 2010 and April 2012, he conspired to recruit and entice victims into Porter’s prostitution ring.
“The Department of Justice is steadfast in its commitment to prosecuting those who seek to profit from enslaving and exploiting others.” said Acting Assistant Attorney General Vanita Gupta of the Justice Department’s Civil Rights Division. “We will continue our unrelenting work to end the scourge of human trafficking and obtain justice on behalf of victims of these heinous crimes.”
Two other defendants pleaded guilty in connection with this case and are scheduled to be sentenced in the coming weeks.
This matter was investigated by the Federal Bureau of Investigation.
The case was prosecuted by the United States Attorney’s Office for the Central District of California and United States Department of Justice, Civil Rights Division, Human Trafficking Prosecution Unit.
Local Immigration Lawyer Arrested on Federal ChargesRead the Press Release
DALLAS — A Dallas attorney was arrested this morning on felony charges, outlined in a federal indictment returned by a grand jury earlier this week and unsealed today, stemming from her work in representing aliens, that is, non-U.S. citizens, before the U.S. Department of Homeland Security (DHS), U.S. Citizen and Immigration Service (USCIS), announced John Parker, Acting U.S. Attorney for the Northern District of Texas.
Sherin Thawer, 45, was arrested by special agents with U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) at her residence in Coppell, Texas. She made her initial appearance today before U.S. Magistrate Judge Stickney, who released her on conditions.
The seven-count indictment charges Thawer with one count of conspiracy to commit fraud in connection with immigration documents; one count of mail fraud; one count of transfer or use of the means of identification of another person; and four counts of aggravated identity theft.
According to the indictment, Thawer represented aliens before USCIS when they were applying for various types of visas to enter or remain in the U.S., including through obtaining U Nonimmigrant Status, also known as a U-Visa. To be eligible for a U-Visa, the alien must have been a victim of a certain crime, suffered mental or physical abuse as a result of the crime, and helped law enforcement in the investigation and/or prosecution of the crime. In addition to the U-Visa application, applicants are to submit a Law Enforcement Certification form completed and signed by the certifying official for the law enforcement agency that investigated and/or prosecuted the crime for which the alien was a victim.
The indictment alleges that beginning in approximately March 2012 and continuing until September 2014, Thawer submitted fraudulently completed and forged Law Enforcement Certification forms to USCIS to obtain U-Visas for the aliens she represented. These Law Enforcement Certification forms, containing the names and badge numbers of police officers, were completed without the knowledge or authorization of the police officers, and the signatures purporting to be those of the named officers were forged.
A federal indictment is an accusation by a grand jury. A defendant is entitled to the presumption of innocence unless proven guilty. If convicted, however, the statutory maximum penalty for the conspiracy charge is ten years in federal prison and a $250,000 fine. The statutory maximum for the transfer or use of the means of identification of another person charge is fifteen years in federal prison and a $250,000 fine, per count. The statutory maximum penalty for the mail fraud count is 20 years in federal prison and a $250,000 fine. Each of the aggravated identity theft counts carries a statutory penalty of a mandatory two years in federal prison and a $250,000 fine.
ICE HSI, the Irving Police Department, and USCIS are investigating. Special Assistant U.S. Attorney Dan Gividen and Assistant U.S. Attorney Aaron Wiley are prosecuting.
Little Rock Models Owner Indicted on Federal Enticement ChargesRead the Press Release
LITTLE ROCK – Christopher R. Thyer, United States Attorney for the Eastern District of Arkansas, and Special Agent in Charge Raymond R. Parmer, Jr., of the New Orleans Field Office for Homeland Security Investigations, announced that Seth Christian Ganahl, age 42, of Maumelle, Arkansas, was indicted on multiple counts related to the sexual exploitation of minors. The U. S. Attorney’s Office announced today that it has set-up a phone number, 501-340-2647, if you have any information on Seth Ganahl, also known as Christian Canon, or regarding Little Rock Models in this on-going investigation.
The indictment, handed down by a Grand Jury in the Eastern District of Arkansas on February 4, 2015, charges Ganahl with two counts of attempted enticement of a minor to engage in sexual activity, one count of enticement of a minor to engage in sexual activity, one count of transportation of a minor with the intent to engage in sexual activity, one count of attempted production of child pornography, and two counts of production of child pornography. Ganahl made his initial appearance before United States Magistrate Judge J. Thomas Ray on February 18, 2015. He entered a plea of not guilty and was ordered to remain detained. His trial is set for March 23, 2015 before United States District Judge Kristine G. Baker.
Electronic devices seized in a search pursuant to federal search warrants revealed that Ganahl was using the name Christian Canon, and his business, Little Rock Models, to entice minors to send him photographs and videos of the minors engaged in sexually explicit conduct. Ganahl would then pay the minors for the photographs and videos. The evidence presented to the Grand Jury also included testimony from two minors that they went to Ganahl’s residence for the purpose of taking sexually explicit photographs. One minor, while at Ganahl’s residence, engaged in sexually explicit conduct with Ganahl, which he recorded.
The charges in the Indictment are based on an investigation that began in August 2014, when a minor disclosed to her mother and the Maumelle Police Department that Ganahl had previously asked her to engage in illicit sexual activity on multiple occasions. After the minor’s disclosure, a second minor disclosed that Ganahl had also asked her to engage in illicit sexual activity.
Ganahl was arrested by the Maumelle Police Department on August 27, 2014. He is currently charged in Pulaski County Circuit Court with 2 counts of sexual indecency with a child and 2 counts of sexual assault in the 2nd degree.
The investigation was conducted by the Little Rock Office of Homeland Security Investigations, the Arkansas State Police Crimes Against Children Division, and the Maumelle Police Department.
Statutory Penalties
18 U.S.C. 2422(b): Enticement of a Minor and Attempted Enticement of a Minor to Engage in Sexual Activity carries a penalty of NLT 10 years to life imprisonment, NLT 5 years to Life of supervised release, and a fine of up to $250,000.
18 USC 2423(a): Transportation of a Minor with intent to engage in criminal sexual activity carries a penalty of NLT 10 years to life imprisonment, NLT 5 years to Life of supervised release, and a fine of up to $250,000.
18 USC 2251(a): Production and Attempted of Child Pornography carries a penalty of NLT 15 years to life imprisonment, NLT 5 years to Life of supervised release, and a fine of up to $250,000.
Lincoln Man Sentenced for Distributing Child PornographyRead the Press Release
United States Attorney Deborah R. Gilg announced that Charles LeRoy Walker, 54, formerly of Lincoln, Nebraska, was sentenced today in Lincoln, Nebraska, to 70 months in prison by United States District Judge John M. Gerrard, for receiving and distributing child pornography. Walker will also be required to be on supervised release for five years after being released from prison and register as a sex offender.
In February of 2014, investigators with the Lincoln Police Department became aware of a computer that was sharing files that had been classified as containing child pornography. Further investigation identified the IP address, service provider and the address of Walker. A search warrant was served and Walker was taken into custody. After forensic examination of the computer equipment removed from Walker’s residence, more than 20,000 files affiliated with child sexual exploitation were located, along with several hundred videos.
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."
This case was investigated by the Lincoln Police Department.
Kodiak Man Indicted for Possession with Intent to Distribute MethamphetamineRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that a Kodiak man was indicted by a federal grand jury in Anchorage, Alaska on drug charges.
Teodoro Berdan, 55, of Kodiak, Alaska was charged with one count of possession with intent to distribute over 50 grams of a mixture or substance containing a detectable amount of methamphetamine. Berdan was arrested on February 7, 2015, in Kodiak after taking possession of a U.S. Postal Service parcel containing 122 grams of a substance that field tested positive for methamphetamine.
Assistant U.S. Attorney Bryan Schroder, who presented the case to the grand jury, indicated that Berdan faces a maximum sentence of 40 years in prison, and a $5,000,000 fine. Under the U.S. Sentencing Guidelines, the actual sentence imposed will be based on a number of factors, including the seriousness of the offense and any prior criminal history of the defendant.
The U.S. Postal Inspection Service conducted the investigation leading to the indictment in this case, with assistance from the FBI and the Kodiak Police Department.
An indictment is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
Jury Convicts Lebanese-Born Man on Charges of Making False Statement to a Federal Agent and an Unlawful Attempt at NaturalizationRead the Press Release
This afternoon in San Antonio, a federal jury convicted 45-year-old Lebanese-born Wissam "Sam" Allouche of knowingly lying to federal authorities, announced Assistant Attorney General for National Security John Carlin, Acting United States Attorney Richard Durbin, Jr., and FBI Special Agent in Charge Christopher Combs, San Antonio Division.
Following a two-week trial, jurors convicted Allouche of making a false statement to the Department of Defense and unlawfully attempt to procure and obtain naturalization and citizenship. Evidence presented during trial revealed that Allouche, who migrated to the United States after marrying a U.S. Army soldier, lied to U.S. immigration authorities about whether he was still living with his spouse during the naturalization process in order to obtain United States citizenship. In addition, while seeking a contract linguist position with the U.S. Department of Defense that required a security clearance, evidence revealed that Allouche failed to disclose that he was a member of the Amal militia. Allouche was acquitted of one count of unlawfully obtaining citizenship by lying about his association with Amal and Hezbollah, both terrorist organizations at the time. Former relatives testified Allouche made statements that he killed an Israeli pilot captured by Hezbollah in retaliation for his imprisonment.
Allouche remains in federal custody pending sentencing scheduled for April 27, 2015. He faces up to ten years in federal prison.
The case was investigated by the FBI and the San Antonio Joint Terrorism Task Force. The case was prosecuted by Assistant U.S. Attorneys Mark Roomberg and Jay Hulings for the Western District of Texas.
Jackson County Resident Sentenced for Heroin OffenseRead the Press Release
On February 20, 2015, Frank R. Johnson, a/k/a “Mo,” 45, of Elkville, Ill., was sentenced for his involvement in a heroin conspiracy the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
Johnson, who had previously pled guilty to a one-count indictment charging conspiracy to distribute heroin, was sentenced to 108 months in prison, to be followed by 3 years’ supervised release. Johnson was fined $400.00. Evidence at the plea and sentencing hearings established that Johnson was transporting ounce amounts of heroin from northern Illinois to Elkville for distribution. On numerous occasions, Johnson sold heroin to a confidential source working for law enforcement and to an undercover agent. When agents executed a search warrant at Johnson’s residence, they recovered heroin, digital scales, drug packaging materials, and a large amount of U.S. currency. At sentencing, the district court determined that Johnson was responsible for the distribution of approximately 825 grams of heroin. Johnson received an enhanced sentence based on the district court’s finding that Johnson had a leadership role in the criminal offense. The offense occurred between 2012 and January 2014, in Jackson and Franklin Counties.
The ongoing investigation is being conducted by the Southern Illinois Enforcement and Drug Enforcement Administration. The Jackson County Sheriff’s Office, West Frankfort Police Department, and Jackson County State’s Attorney’s Office assisted in the investigation.
The case is assigned to Assistant United States Attorney Amanda A. Robertson for prosecution.
Investment Executive Pleads Guilty in Manhattan Federal Court to Participating in $30 Million Insurance Fraud SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that ALLEN REICHMAN, a former Executive Director of Investments at a New York investment firm, pled guilty today in Manhattan federal court to participating in a massive scheme to defraud his employer and insurance regulators in connection with the fraudulent purchase of an Oklahoma insurance company. REICHMAN pled guilty today before U.S. Magistrate Judge Henry B. Pitman.
Manhattan U.S. Attorney Preet Bharara said: “As Allen Reichman has now admitted, he deceived his employer to enable the illegal purchase of an insurance company. His associates looted the assets of the company, leaving it unable to pay policyholders, and Reichman pocketed over $200,000 in commissions on the fraudulent $30 million loan. He now awaits sentencing for his deceit and self-dealing.”
According to the information, plea agreement, and statements made during court proceedings:
During the relevant time period, REICHMAN was an executive at an investment bank and financial services company headquartered in New York, New York (the “Investment Firm”). From July 2008 to November 2009, REICHMAN conspired with Charles J. Antonucci, Sr. and Matthew L. Morris, the President and Senior Vice President, respectively, of Park Avenue Bank, a New York bank, and Wilbur Anthony Huff, a Kentucky businessman who controlled numerous entities located throughout the United States, to defraud the Investment Firm and Oklahoma insurance regulators regarding Antonucci’s purchase of Providence Property and Casualty Insurance Company (“Providence P&C”), an Oklahoma insurance company that was owed $5 million by a company Huff controlled. Providence P&C was licensed to operate by the Oklahoma Insurance Department (“OID”), which regulated various practices of Oklahoma insurance companies. Under the OID’s regulations and applicable Oklahoma law, Providence P&C was required to maintain a certain amount of assets to ensure that adequate funds were on hand to pay policyholders’ claims and anticipated claims.
REICHMAN and his co-conspirators schemed to defraud the Investment Firm into providing a $30 million loan to finance Antonucci’s purchase of Providence P&C and to defraud Oklahoma insurance regulators into approving the purchase. The $30 million loan from the Investment Firm to purchase Providence P&C was secured by Providence P&C’s own assets, including the reserve assets. Because Oklahoma insurance regulators had to approve any sale of Providence P&C, and because Oklahoma law forbade the use of Providence P&C’s assets as collateral for such a loan, REICHMAN, Huff, Morris, and Antonucci, made, and conspired to make, a number of material misstatements and material omissions to the Investment Firm and Oklahoma insurance regulators concerning the true nature of the financing for the purchase. Specifically, Investment Firm executives and others warned REICHMAN on several occasions that using Providence P&C’s assets as collateral for the loan was illegal and that he should not cause the loan to be issued. REICHMAN ignored these warnings and instead provided misleading information to various individuals at the Investment Firm and elsewhere regarding the loan, including directing Antonucci to sign a letter that provided false information regarding the collateral that would be used for the loan. Despite the warnings from Investment Firm executives and others, and REICHMAN’s knowledge that the loan was in fact illegal, on or about January 30, 2009, REICHMAN caused the Investment Firm to issue the illegal $30 million loan, which was secured by the very assets that were supposed to be unencumbered and maintained in reserve to pay Providence P&C’s policyholder claims.
After deceiving the Investment Firm into issuing the $30 million loan, REICHMAN received at least $200,000 in commissions from the Investment Firm as a result of the illegal loan. Ultimately, in November 2009, Providence P&C became insolvent and was placed in receivership because its surplus was encumbered by the $30 million loan, and therefore unavailable to pay policyholder claims, and because Huff, Morris, and Antonucci had pilfered Providence P&C’s remaining assets.
REICHMAN, 54, of of Irvington, New York, pled guilty to one count of conspiracy to commit wire fraud, which carries a maximum penalty of five years in prison. He will be sentenced by U.S. District Court Judge Naomi Reice Buchwald on a date to be determined. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. As part of his plea, REICHMAN also agreed to forfeit $200,000 to the United States and to provide restitution of $10 million to the Investment Firm.
Charles Antonucci, who was charged separately, pled guilty for his role in the scheme on October 8, 2010. Matthew L. Morris and Wilbur Anthony Huff pled guilty in connection with the case on October 17, 2014, and December 24, 2014, respectively.
Mr. Bharara praised the investigative work of the Special Inspector General for the Troubled Asset Relief Program, the Federal Bureau of Investigation, the IRS, the New York State Department of Financial Services, Immigration and Customs Enforcement’s Homeland Security Investigations, and the Office of Inspector General of the FDIC. Mr. Bharara also thanked the Department of Justice’s Tax Division and the United States Attorney’s Office for the Southern District of Florida for their assistance.
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 is 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.
The case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Janis Echenberg and Daniel B. Tehrani are in charge of the prosecution.
Huntsville Pharmaceutical Distribution Facility Agrees to Pay $300,000 PenaltyRead the Press Release
HUNTSVILLE -- A Huntsville pharmaceutical distribution facility has agreed to pay the federal government $300,000 to settle allegations that it failed to maintain complete and accurate records and inventories of controlled substances, including opioid painkillers, announced U.S. Attorney Joyce White Vance and Drug Enforcement Administration Special Agent in Charge Clay A. Morris.
Generics Bidco and the U.S. Attorney for the Northern District of Alabama finalized the settlement agreement this week. The settlement was reached without any filings in U.S. District Court. With the payment of the penalty, the government agrees to release Generics from all civil liability for violations of records keeping under the Controlled Substances Act.
"The $300,000 penalty in this matter represents the largest penalty collected in Alabama in a DEA compliance investigation," Vance said. "It is imperative that pharmaceutical companies, and all facilities registered with DEA to handle controlled substances, keep clear and current records on receipt and distribution of those narcotics so that they can be tracked and not at risk of being diverted for illegal use in our communities," she said. "I applaud the DEA for its diligent work to ensure all facilities registered with the agency comply with the strict record-keeping and control mechanisms of the Controlled Substances Act."
DEA conducted an accountability audit of Generics for Dec. 12, 2012, through July 14, 2014, and raised allegations that the business violated record-keeping provisions of the Controlled Substances Act by not keeping separate bi-annual inventories of Schedule II controlled substances and the less restricted Schedule III-V substances. DEA also charged that Generics did not keep records readily available, and that the audit showed substantial error in the accounting of the Schedule II and III drugs hydrocodone, carisoprodol, oxycodone and Meperitab.
Generics, as part of the settlement agreement, denies any intentional violation of regulations, but states it has updated several record-keeping procedures and has taken other voluntary measures to assist with compliance. The company cooperated fully in the DEA audit and follow-up proceedings.
Honduran National Pleads Guilty to Illegal Reentry into the United StatesRead the Press Release
U.S. Attorney Kenneth A. Polite announced that JUAN RAMON ALVAREZ-MARTINEZ, a/k/a Juan Ramon-Alvarez, age 37, from Honduras, pled guilty yesterday to a one-count Indictment charging illegal reentry of removed alien.
According to the Indictment, ALVAREZ-MARTINEZ was found by Border Patrol agents in the Eastern District of Louisiana after records showed he had been previously deported from the United States to Honduras on March 7, 2005.
ALVAREZ-MARTINEZ faces a maximum term of imprisonment of two years, a maximum fine of $250,000, a maximum term of supervised release of one year, and a mandatory $100 special assessment. U.S. District Judge Lance M. Africk set sentencing for April 2, 2015.
U.S. Attorney Polite praised the work of the U.S. Border Patrol in investigating this matter. Assistant U.S. Attorney Gregory M. Kennedy is in charge of the prosecution.
Gun Dealers Sentenced for Federal Firearms ViolationsRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that BRIAN VANACORE, 49, of North Branford, GREG BODYTKO, 55, of Northford, were sentenced yesterday Bridgeport federal court for violating federal firearms laws. U.S. Magistrate Judge William I. Garfinkel ordered VANACORE and BODYTKO to serve, one year of probation, pay a $500 fine and perform 100 hours of community service.
According to court documents and statements made in court, VANACORE and BODYTKO were the owners of BMG LLC (BMC), which operated a gun store at 2585 Berlin Turnpike in Newington. VANACORE and BMG had three separate federal firearms licenses to deal firearms in Connecticut, and BODYTKO was a 50 percent partner in the business with VANACORE.
In the summer of 2013, the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) conducted a routine inspection of BMG’s Newington store. During the inspection, ATF inspectors found several firearms, including machine guns and silencers, which are required to be registered under the National Firearms Act. BMG records revealed that BMG had purchased these firearms, but had not changed the registration information in the National Firearms Registration and Transfer Record. As a result, each of the firearms remained registered to the individual who sold them to BMG. In total, BMG possessed 15 firearms that it should have registered under the National Firearms Registration and Transfer Record.
BMG, VANACORE and BODYTKO also failed, on numerous occasions, to report the sale of multiple handguns to the same individual, and failed to record in their Acquisition and Disposition records the acquisition and/or disposition of hundreds of firearms. On numerous occasions, the defendants failed to fill out properly, or failed to fill out at all, ATF Form 4473, a form that must be completed by individuals who purchase firearms from federally-licensed firearms dealers. They also failed to conduct necessary background checks on at least 10 separate occasions.
“Federally-licensed firearms dealers are our first line of defense in making certain that firearms don’t wind up in the hands of the wrong people,” stated U.S. Attorney Daly. Gun dealers who don’t comply with the rules and violate federal law will be prosecuted.
On March 5, 2014, VANACORE and BODYTKO each pleaded guilty to one count of failing to keep a complete and accurate written record in its acquisition and disposition records for firearms, and one count of failing to report the multiple sale of handguns. VANACORE also entered a guilty plea on behalf of BMG to one count of making false entries in dealer’s records.
BMG was previously sentenced to five years’ probation, and the store is no longer in operation.
VANACORE and BODYTKO were ordered to surrender their Federal Firearm Licenses (FFL) and they not permitted to reapply for an FFL for five years.
This matter was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives. The case was prosecuted by Assistant U.S. Attorney Robert M. Spector.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Greece Man Found Guilty of Receiving and Possessing Child Pornography Following Non-Jury TrialRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
BUFFALO, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that Nicholas M. Skvarla, of Greece, NY, was found guilty of receipt and possession of child pornography by U.S. District Judge Richard J. Arcara following a non-jury trial. The charges carry a mandatory minimum penalty of five years in prison and a maximum of 20 years and a $250,000 fine.Assistant U.S. Attorneys Aaron J. Mango and Bradley E. Tyler, who are handling the case, stated that in March 2008, the Monroe County Sheriff’s Department conducted an undercover peer to peer internet file sharing investigation. A deputy found numerous image and video files available for download from a particular Internet Protocol (IP) address. Further investigation determined the IP address belonged to the defendant.
The investigator downloaded images and videos over five dates in April, May and July of 2008. Of the 24 images and videos downloaded, at least 10 appeared to depict children under the age of 17 and depict minors engaged in sexually explicit conduct. On September 11, 2008, investigators conducted a search warrant at Skvarla’s Forgham Road residence at which time the defendant was arrested.
Several items seized from the defendant’s residence were turned over the Western New York Regional Computer Forensics Laboratory. A forensic examination determined that Skvarla’s computer and hard drive contained 139 images and 112 videos of suspected child pornography. A total of 32 known children were identified in the images.
The verdict is the culmination of an investigation on the part of the Monroe County Sheriff’s Department, under the direction of Sheriff Patrick O’Flynn, the Federal Bureau of Investigation Cyber Crime Task Force, Immigration and Customs Enforcement, Homeland Security Investigation, under the direction of Special Agent in Charge James C. Spero, and the Western New York Regional Computer Forensics Laboratory.
Sentencing is scheduled for May 26, 2015 at 12:30 p.m. before Judge Arcara.
Gibson City Man Sentenced to Eight Years in Federal Prison for Mail Fraud, Tax EvasionRead the Press Release
Peoria, Ill. – A Gibson City, Ill., man, Carl Kieser, has been sentenced to eight years in prison for mail fraud, tax evasion, and illegal application of a pesticide inconsistent with its labeling. Yesterday, Chief U.S. District Judge James E. Shadid ordered that Kieser, 63, serve 97 months (8 years, 1 month) in federal prison, and three years of supervised release following his release from prison. Kieser was ordered to report on May 5, 2015, to the federal Bureau of Prisons to begin serving his sentence. Kieser was also ordered to pay restitution in the total amount of $75,862; $71,411 to the IRS and $4,451 to victims he defrauded.
On Oct. 31, 2014, a jury convicted Kieser of three counts of mail fraud and illegal application of a pesticide inconsistent with its labeling. On July 8, 2014, Kieser had entered open pleas of guilty to four counts of tax evasion.
Kieser owned and operated Aquatic Control of Illinois, at his Gibson City Fishing and Camping Club, south of Gibson City on Route 47. At trial, the government presented evidence that Kieser manufactured, advertised, sold, and distributed a product he called Pond Clear Plus. Kieser produced Pond Clear Plus by mixing Diuron 80DF with other ingredients, including a blue pond dye. Diuron 80DF is a pesticide registered with the U.S. Environmental Protection Agency for the control of land-based weeds; the EPA-approved labeling for the pesticide warns that the chemical should not be applied directly to water due to its toxicity to fish and other aquatic wildlife.
Kieser’s advertisements for Pond Clear Plus in newspapers and magazines falsely and fraudulently represented that Pond Clear Plus could control lake weeds and algae “Mother Nature’s Way,” with “No Chemicals,” using a “biological method with live bacteria that dissolves plant nutrients, black muck, and rotten egg odor.” Kieser also falsely and fraudulently represented to customers that Pond Clear Plus contained no chemicals. In fact, as Kieser knew full well, Pond Clear Plus contained the chemical pesticide Diuron 80DF, which was prohibited by its EPA-approved labeling from being applied directly to water.As a result of his false advertising and representations, Kieser sold and distributed Pond Clear Plus to customers from approximately July 2007 to September 2012. Kieser obtained more than $400,000 in proceeds from customers from the sale of Pond Clear Plus, but failed to pay any federal income tax on his profits from 2008 to 2011.
Kieser provided Pond Clear Plus to his customers via Federal Express or some other means in 2.5 gallon jugs without any labels, including any labels informing customers that Pond Clear Plus contained Diuron 80DF and should not be applied directly to water. To the contrary, Kieser advised customers that Pond Clear Plus contained no chemicals and should be applied by pouring it directly into the customer’s pond or lake. Moreover, Kieser himself on occasion directly applied Pond Clear Plus to lakes or ponds for his customers. As a result, Diuron 80DF was directly applied to ponds and lakes throughout the U.S. in direct contravention of its EPA-approved labeling, and multiple customers experienced fish kills following the application of Pond Clear Plus to their ponds and lakes.
“Mail fraud is a crime that can have wide-ranging impacts, sometimes leading to serious public health threats,” said Randall Ashe, Special Agent in Charge of EPA’s criminal enforcement program in Illinois. “EPA’s mission of protecting public health and the environment is undermined when violators misuse and illegally market potentially harmful chemicals. This sentencing sends a strong message that violators who skirt the law to line their own pockets will pay the price.”
The case was prosecuted by Assistant U.S. Attorney Eugene L. Miller. The charges were investigated by the U.S. Environmental Protection Agency, Criminal Investigation Division, and the Internal Revenue Service Criminal Investigation Division, with the assistance of the Illinois Department of Natural Resources, the Illinois Environmental Protection Agency, and the Illinois Department of Agriculture.Georgia Couple Found Guilty of Tax FraudRead the Press Release
A Milledgeville, Georgia, couple were found guilty of tax fraud following a three-day jury trial for skimming more than $1.5 million in cash from their business without disclosing the income, the Department of Justice announced.
Kenneth Horner, 58, and Kimberly Horner, 53, were charged with filing false corporate and personal tax returns for the years 2007 and 2008. They were convicted of all four counts charged. Their sentencing is scheduled for May 6 at 10:00 a.m. before U.S. District Judge Timothy C. Batten Sr.
“This jury recognized the defendants’ handling of cash for what it really was: a ploy to avoid disclosing income and paying taxes,” said Acting U.S. Attorney John Horn of the Northern District of Georgia.
“In willfully failing to report their total business income to the IRS, the Horners cheated the system and dodged the same basic responsibility that millions of other business owners comply with every year: fairly and honestly reporting their earnings,” said Principal Deputy Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division. “Today’s verdict establishes that those who engage in such criminal conduct will be held accountable. The Tax Division is committed to working with its law enforcement partners to identify, investigate and vigorously prosecute these offenders.”
“At this time of year, when hard-working citizens are sitting down to prepare their tax returns, it is especially disappointing to see the overt steps some individuals will take to hide their taxable funds from the government,” said Special Agent in Charge Veronica F. Hyman-Pillot of the Internal Revenue Service (IRS)-Criminal Investigation. “Taxpayers deserve our vigilance in the investigation and prosecution of individuals who willfully underreport their income and evade the payment of their fair share of taxes.”
According to Acting U.S. Attorney Horn, the charges and other information presented in court: Kenneth and Kimberly Horner owned Topcat Towing and Recovery Inc. (Topcat Towing), a towing business in Lithonia, Georgia. Between 2005 and 2008, Topcat Towing had an exclusive contract with DeKalb County, Georgia, for all county car tows needed from the south precinct of the county. Between 2005 and 2008, the defendants skimmed more than $1.5 million in cash receipts from their towing business and deposited those cash receipts into their personal bank account without disclosing the income to their tax return preparer or on corporate and personal tax returns filed with the IRS. The defendants tried to conceal their cash deposits from the government by “structuring” their deposits, which is the act of splitting up cash deposits that exceed $10,000 for the purpose of evading a Currency Transaction Report (CTR) from being filed.
Most financial institutions, including banks, are generally required to file CTRs for cash transactions that exceed $10,000. CTRs are submitted to the U.S. Department of Treasury. In 2007 and 2008, the defendants used their unreported cash, in part, to build a custom home in Conyers, Georgia, that was appraised at more than $900,000. The defendants owe approximately $400,000 in taxes to the IRS for their unreported income.
This case is being investigated by the IRS-Criminal Investigation. Trial Attorney Christopher J. Maietta of the Tax Division and Assistant U.S. Attorney Steven D. Grimberg of the Northern District of Georgia are prosecuting the case.
Former Plymouth Finance Director Pleads Guilty to Federal Theft and Tax ChargesRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that DAVID J. BERTNAGEL, 41, of Thomaston, waived his right to indictment and pleaded guilty today in Bridgeport federal court to theft and tax charges stemming from his embezzlement of more than $800,000 from the Town of Plymouth.
According to court documents and statements made in court, from October 2011 through October 2014, BERTNAGEL was employed as the Finance Director for the Town of Plymouth. During that time period, BERTNAGEL issued 207 checks totaling approximately $808,030 from the Town’s payroll account to himself. BERTNAGEL used the embezzled funds to make mortgage payments, pay credit card bills, fund home improvement projects and purchase more than $100,000 in coins, stamps and other collectibles. He also converted more than $182,000 of the stolen funds by way of cashed checks, ATM withdrawals and money orders.
In addition, BERTNAGEL’s federal tax returns for the 2012 and 2013 tax years failed to report any of his embezzled income, resulting in a tax loss to the government of $145,564 for those two years. BERTNAGEL also did not file a tax return with the IRS for the 2011 tax year.
Since 2011, Plymouth has received approximately $450,000 in grant awards from the U.S. Department of Health and Human Services.
BERTNAGEL was arrested on January 20, 2015.
BERTNAGEL pleaded guilty to one count of theft from a local government receiving federal funds, which carries a maximum term of imprisonment of 10 years, and one count making and subscribing a false tax return, which carries a maximum term of imprisonment of three years. He is scheduled to be sentenced by U.S. District Judge Jeffrey Alker Meyer on May 15, 2015.
As part of his plea agreement, BERTNAGEL agreed to make restitution in the amount of $808,029.94 to the Town of Plymouth, and he must cooperate with the IRS to pay all outstanding taxes, penalties and interest. BERTNAGEL also has agreed to forfeit more than $45,000 that he held in bank accounts, and assorted jewelry, stamps, coins and other collectibles that were seized on the date of his arrest.
This matter is being investigated by the Connecticut Public Corruption Task Force, which includes the Federal Bureau of Investigation, Internal Revenue Service – Criminal Investigation Division, U.S. Postal Inspection Service, U.S. Department of Housing and Urban Development – Office of Inspector General and U.S. Department of Health and Human Services – Office of Inspector General. The case is being prosecuted by Assistant U.S. Attorney Christopher M. Mattei.
Citizens are encouraged to report corrupt activity to the Connecticut Public Corruption Task Force by calling 1-800-CALL-FBI (1-800-225-5324).
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Former Military Contractor Pleads Guilty for Paying Bribe to Army Officer During Iraq WarRead the Press Release
A former military contractor who ran two Kuwaiti companies during the Iraq War pleaded guilty today for paying a $15,000 bribe to an Army National Guard officer in exchange for the award of a contract to provide buses to the United States Army, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Zane David Memeger of the Eastern District of Pennsylvania.
George H. Lee, 71, of Philadelphia, pleaded guilty today before U.S. District Judge Joel H. Slomsky in the Eastern District of Pennsylvania to one count of bribery of a public official. Sentencing has been scheduled for July 7, 2015.
During his guilty plea, Lee admitted that as the president and chief executive officer of American Logistics Services (ALS), a Kuwaiti company providing supplies to the U.S. military in Iraq, he paid a $15,000 bribe to Lieutenant Markus E. McClain in exchange for McClain’s agreement to award an extension of a lucrative bus contract to ALS. Specifically, Lee admitted that in August 2004 several of his employees met with McClain at Camp Arifjan, Kuwait and offered McClain $15,000 and a Rolex watch in exchange for McClain’s agreement to award the contract extension to ALS. Lieutenant McClain initially declined, but one month later Lee renewed the offer, and McClain accepted $15,000 to use his official position to award the contract extension to ALS.
McClain previously pleaded guilty to one count of accepting a gratuity and is awaiting sentencing.
The case is being investigated by the U.S. Army Criminal Investigation Command, the Defense Criminal Investigative Service and the U.S. Department of Homeland Security – Immigration and Customs Enforcement, and was previously investigated by the Office of the Special Inspector General for Iraq Reconstruction. The case is being prosecuted by Trial Attorneys John Keller and Richard Evans of the Criminal Division’s Public Integrity Section.
Former Maverick County Justice of the Peace Cesar Iracheta Indicted by Federal Grand Jury for "Pay-To-Play" Bribery Scheme Involving County ContractsRead the Press Release
This morning, FBI agents arrested 56-year-old former Maverick County Justice of the Peace and Eagle Pass businessman Cesar Iracheta on federal bribery charges in a "pay-to-play" scheme involving County construction contracts announced Acting United States Attorney Richard Durbin, Jr., and FBI Special Agent in Charge Christopher Combs, San Antonio Division.
A federal grand jury indictment, returned on Wednesday and unsealed today, charges Iracheta with two counts of paying bribes. The indictment alleges that in 2010, Iracheta, doing business as C&A Construction, paid a bribe to a Maverick County commissioner in order to secure two Precinct 2 County construction contracts worth approximately $49,000. The indictment also alleges that in 2011, Iracheta paid a bribe to another Maverick County commissioner in order to secure a Precinct One County construction contract worth $22,500.
According to the indictment, Iracheta submitted inflated bids to Maverick County in order for there to be sufficient funds to perform the construction work, make a profit, and pay bribes to the County commissioners.
Upon conviction, Iracheta faces up to ten years in federal prison for each bribery charge.
This ongoing investigation is being conducted by the FBI and the Texas Department of Public Safety Criminal Investigative Division together with the Customs and Border Protection Office of Internal Affairs. Individuals who have first-hand information about corruption, fraud, or bribery related to Maverick County are urged to contact the FBI at (210) 225-6741.
Assistant United States Attorney Katherine Griffin and Bryan Reeves are prosecuting this case on behalf of the Government.
An indictment is merely a charge and should not be considered as evidence of guilt. The defendant is presumed innocent until proven guilty in a court of law.
Former IRS Employee and Three Others Indicted for Conspiracy to Commit Mail FraudRead the Press Release
FORMER IRS EMPLOYEE AND THREE OTHERS
INDICTED FOR CONSPIRACY TO COMMIT MAIL FRAUD
PENSACOLA, FLORIDA – Four Pensacola residents, including a former IRS tax examiner, have been indicted for conspiring to file false claims for payment in connection with the 2010 BP oil spill. The indictment was announced today by Pamela C. Marsh, United States Attorney for the Northern District of Florida.
Rosa M. Bonner, 52, Ariyanna S. Lampley, 33, Jimmie A. McCorvey, 41, and Marcia D. McCorvey, 42, all of Pensacola, are charged with conspiracy to commit mail fraud for filing false claims with the Gulf Coast Claims Facility (“GCCF”) alleging lost income as a result of the 2010 BP oil spill in the Gulf of Mexico. The indictment alleges that between 2010 and 2012, the defendants agreed to have Jimmie McCorvey file false GCCF claims in their names. Lampley is also alleged to have provided Jimmie McCorvey with additional identities for filing false GCCF claims. The indictment alleges that as a result of these false claims, GCCF paid $95,200 to the defendants.
Jimmie McCorvey, who was an IRS employee at the time, is also charged with conspiring to file false tax returns. The indictment alleges that between 2009 and 2011, Jimmie McCorvey prepared and filed approximately 25 fraudulent federal income tax returns, resulting in the issuance of more than $62,000 in tax refund checks. The indictment further charges Jimmie McCorvey with aggravated identity theft for fraudulently using other people’s identities in both schemes.
Trial in this case is currently set for April 6, 2015, before Senior United States District Court Judge Roger Vinson. This case resulted from investigations by the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation and is being prosecuted by Assistant United States Attorney Alicia Kim.
An indictment is merely an allegation by a grand jury that a defendant has committed a violation of federal criminal law and is not evidence of guilt. All defendants are presumed innocent and entitled to a fair trial, during which it will be the government’s burden to prove guilt beyond a reasonable doubt at trial.
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.
Former First Lady of Virginia Sentenced to PrisonRead the Press Release
RICHMOND, Va. – The former First Lady of Virginia, Maureen G. McDonnell, 60, of Glen Allen, Virginia, was sentenced today to one year and one day in prison, for soliciting and obtaining payments, loans, gifts and other items from Star Scientific, a Virginia-based corporation, and Jonnie R. Williams Sr., Star Scientific’s then chief executive officer, in violation of federal public corruption laws.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:14cr12.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Leslie R. Caldwell, Assistant Attorney General of the Justice Department’s Criminal Division; Adam S. Lee, Special Agent in Charge of the FBI’s Richmond Field Office; Richard Weber, Chief, IRS Criminal Investigation (IRS-CI); and Colonel W. Steven Flaherty, Virginia State Police Superintendent, made the announcement after sentencing by Senior U.S. District Judge James R. Spencer.
Former Virginia Governor Robert McDonnell and his wife, Maureen McDonnell, were convicted on Sept. 4, 2014, following a jury trial of one count of conspiracy to commit honest-services wire fraud and one count of conspiracy to obtain property under color of official right. Maureen McDonnell also was convicted of two counts of honest-services wire fraud and four counts of obtaining property under color of official right, while Robert McDonnell was convicted of three counts of honest-services wire fraud and six counts of obtaining property under color of official right. In total, Maureen McDonnell was convicted of eight of 13 counts and Robert McDonnell was convicted of 11 of 13 counts.
According to the evidence presented at trial, from April 2011 through March 2013, the McDonnell’s participated in a scheme to use the former governor’s official position to enrich themselves and their family members by soliciting and obtaining payments, loans, gifts and other things of value from Star Scientific and Jonnie R. Williams Sr. The McDonnell’s obtained these items in exchange for the former governor performing official actions to legitimize, promote and obtain research studies for Star’s products, including the dietary supplement Anatabloc.
According to evidence presented at trial, the McDonnell’s obtained from Williams more than $170,000 in direct payments as gifts and loans, thousands of dollars in golf outings, and numerous items. As part of the scheme, Robert McDonnell arranged meetings for Williams with Virginia government officials, hosted and attended events at the Governor’s Mansion designed to encourage Virginia university researchers to initiate studies of Star’s products and to promote Star’s products to doctors, contacted other Virginia government officials to encourage Virginia state research universities to initiate studies of Star’s products, and promoted Star’s products and facilitated its relationships with Virginia government officials.
The evidence further showed that the McDonnell’s attempted to conceal the things of value received from Williams and Star to hide the nature and scope of their dealings with Williams from the citizens of Virginia by, for example, routing gifts and loans through family members and corporate entities controlled by the former governor to avoid annual disclosure requirements.
The case is being prosecuted by Assistant U.S. Attorneys Michael S. Dry, Jessica D. Aber, and Ryan S. Faulconer of the U.S. Attorney’s Office for the Eastern District of Virginia, and Deputy Chief David V. Harbach II of the Criminal Division’s Public Integrity Section. The case is being investigated by the FBI’s Richmond Division, IRS-CI, and the Virginia State Police.Former Arizona Army National Guard Sergeant Sentenced to 52 Months in Prison for Participating in Scheme to Protect Purported Drug TraffickersRead the Press Release
Fifty-Seven Individuals Previously Convicted and Sentenced as Part of This Investigation
A former member of the Arizona Army National Guard was sentenced today to 52 months in prison for his role in a scheme to accept bribes from purported drug traffickers in exchange for using his military position to protect shipments of cocaine during transportation, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division.
Raul Portillo, 42, of Phoenix, Arizona, pleaded guilty on Nov. 21, 2014, to one count of conspiracy to commit bribery and interfere with commerce by attempted extortion. U.S. District Judge James A. Soto of the District of Arizona imposed the sentence.
According to admissions made in connection with his guilty plea, Portillo, a sergeant in the Arizona Army National Guard, conspired with others from the Arizona Army National Guard to accept cash bribes to protect narcotics traffickers who were purportedly transporting and distributing cocaine from Arizona to other locations in the southwestern United States. Unbeknownst to Portillo and the other co-conspirators, however, the supposed narcotics traffickers were actually undercover FBI agents.
Specifically, Portillo admitted that he wore his official uniform, carried official forms of identification, used official vehicles and used his official authority, where necessary, to prevent police stops and searches as he drove cocaine shipments through checkpoints manned by the U.S. Border Patrol, the Arizona Department of Public Safety, and Nevada law enforcement officers. Portillo admitted that he took bribe payments totaling $12,000 for transporting cocaine on two separate occasions. Portillo also admitted that he accepted a $2,000 cash payment in exchange for recruiting an Immigration and Customs Enforcement inspector into the conspiracy.
In 2006, an arrest warrant was issued for Portillo, and Portillo was arrested in May 2011, arraigned and released on personal recognizance. Portillo admitted that in or around July 2011, he fled to avoid prosecution.
To date, 58 defendants have been convicted and sentenced for charges stemming from this investigation.
This case is part of a joint investigation conducted by the Southern Arizona Corruption Task Force (SACTF), which is comprised of the FBI, the Drug Enforcement Administration, the Bureau of Immigration and Customs Enforcement, and the Tucson Police Department. Though not part of the SACTF, the Arizona National Guard, Air Force Office of Special Investigations, Defense Criminal Investigative Service and Internal Revenue Service’s Criminal Investigation Division also participated in the investigation. The case is being prosecuted by Trial Attorneys Monique T. Abrishami and Peter N. Halpern of the Criminal Division’s Public Integrity Section.