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Thursday 29 January 2015
Former Executives of Marketing Agency Plead Guilty in Manhattan Federal Court to Filing False Tax ReturnsRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that MICHAEL J. MITROW, Jr., pled guilty today to conspiracy to commit wire fraud for defrauding his former employer, a New Jersey-based pharmaceutical marketing agency (the “Marketing Agency”), and co-defendant MATTHEW J. MITROW pled guilty on Monday to filing a false tax return that failed to report more than $90,000 in income. MICHAEL MITROW submitted false invoices to the Marketing Agency and used the proceeds to pay for more than $600,000 in private jet travel. MICHAEL MITROW also pled guilty to tax evasion for failing to report those proceeds to the IRS, as well as approximately $1 million of additional income he received from a co-defendant. Co-defendant MATTHEW MITROW failed to report to the IRS payments received from Creative Press that he used for home renovations, private jet travel, and other personal expenses. Both defendants pled guilty before U.S. District Judge Paul A. Engelmayer.
According to the Indictment and Superseding Information previously filed in Manhattan federal court, as well as statements made at plea proceedings Monday and today and in other court proceedings:
MICHAEL J. MITROW, Jr., was the former CEO and President of the Marketing Agency from 1998 through approximately 2009. From 2008 through 2009, MICHAEL MITROW defrauded the Marketing Agency by submitting fraudulent invoices for consulting services that were purportedly provided to the Marketing Agency. In truth, however, no such consulting services had been provided. Instead, MICHAEL MITROW used the proceeds from those invoices to fund more than $600,000 in private jet travel.
MICHAEL MITROW also failed to report more than $1.6 million in income he received during the 2008 tax year, including payments he received from two companies owned by Robert Madison, as well as personal purchases MICHAEL MITROW made with his corporate credit card that he fraudulently coded as business expenses of the Marketing Agency.
MATTHEW J. MITROW was the Executive Vice-President of the Marketing Agency. During the 2008 tax year, MATTHEW MITROW received approximately $91,000 in payments from Creative Press, a printing and direct mail marketing company located in Phoenix, Arizona, that provided printing and direct mailing services to the “Marketing Agency”. The payments MATTHEW MITROW received from Madison and Creative Press included approximately $39,000 in home renovations, $30,000 in payments to MATTHEW MITROW’s personal credit cards, and more than $21,000 for private jet travel. MATTHEW MITROW willfully failed to include those payments as income on his 2008 tax return. In 2009, Creative Press also paid a $19,000 debt at a New York City “Gentlemen’s Club,” which he also failed to report on his tax returns.
MICHAEL J. MITROW, Jr., 47, of Whitehouse Station, New Jersey, pled guilty today to one count of conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison, and one count of tax evasion, which carries a maximum sentence of five years in prison. MICHAEL MITROW also agreed to pay restitution in an amount to be determined by the Court. MICHAEL MITROW’s sentencing is scheduled for June 25, 2015, at 9:30 a.m., before Judge Engelmayer.
MATTHEW J. MITROW, 40, of Westfield, New Jersey, pled guilty on Monday, January 26, 2015, to one count of filing a false tax return, which carries a maximum sentence of five years in prison. MATTHEW MITROW’s sentencing is scheduled for June 4, 2015, at 11:00 a.m., before Judge Engelmayer.
The maximum sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencings of the defendants will be determined by the Judge.
Mr. Bharara thanked the Internal Revenue Service, Criminal Investigations, and the United States Postal Inspection Service for their outstanding investigative work in this case. Mr. Bharara also thanked the U.S. Department of Justice’s Tax Division for its assistance.
This case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Special Assistant United States Attorney Andrew Young and Department of Justice Tax Division Senior Litigation Counsel Nanette L. Davis are in charge of the prosecution.
Former Controller of Greenwich Hedge Fund Admits Embezzling More Than $9 MillionRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, and Patricia M. Ferrick, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, announced that LAWRENCE J. HERZING, 45, of Greenwich, pleaded guilty today before U.S. District Judge Jeffrey Alker Meyer in Bridgeport to one count of wire fraud stemming from his theft of more than $9 million from the hedge fund where he was employed.
According to court documents and statements made in court, HERZING was recently employed as the controller of Greenwich-based Contrarian Capital Management, L.L.C. On 32 occasions between 2004 and 2013, HERZING used his position to wire $9,202,417.54 from his employer to accounts that he controlled.
HERZING was arrested on October 29, 2014, and currently is released on a $5.6 million bond.
Judge Meyer scheduled sentencing for April 24, 2015, at which time HERZING faces a maximum term of imprisonment of 20 years, a fine and an order of restitution. HERZING also has agreed to forfeit his residence and approximately $1.8 million.
This matter is being investigated by the Federal Bureau of Investigation, with the assistance of the Greenwich Police Department. The case is being prosecuted by Assistant U.S. Attorneys Jonathan Francis and Heather Cherry.
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[email protected]Foreign National Pleads Guilty to Firearm Offense, Growing Marijuana in Mendocino National Forest, and Destruction of National Lands and ResourcesRead the Press Release
SACRAMENTO, Calif. — Ivan Espinoza Villafana, 25, a Mexican national, pleaded guilty today to possession of a firearm by an illegal alien, cultivation of marijuana, and depredation of public lands and resources, United States Attorney Benjamin B. Wagner announced.
According to court documents, on August 19, 2014, law enforcement officers entered a marijuana cultivation site near Ice Springs in the Mendocino National Forest in Glenn County where 732 marijuana plants were growing. Villafana was arrested at the site and had a Smith & Wesson revolver in his possession. Officers also found a rifle in the camp area of the site. Significant natural resource damage was observed at the site. Vegetation and trees had been cut and removed to improve growing conditions for the marijuana plants, water was diverted from a nearby stream to water the plants, and fertilizers and pesticides were found at the site which, based on the terrain, would likely have drained into waterways in the National Forest. It is estimated that repairing and rehabilitating the marijuana cultivation site at Ice Springs would cost at least $14,400.
This case is the product of an investigation by the United States Forest Service, Glenn County Sheriff’s Office, and California Department of Fish and Wildlife. Assistant United States Attorney Christiaan Highsmith is prosecuting the case.
Villafana is in custody and is scheduled to be sentenced by United States District Judge Troy L. Nunley on April 16, 2015. Villafana faces a maximum statutory penalty of 20 years in prison and a $1 million fine for the marijuana cultivation charge; 10 years in prison and a $250,000 fine for the possession of a firearm by an illegal alien charge; and 10 years in prison and a $250,000 fine for the depredation of public lands and resources charge. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
Five Defendants Sentenced for Their Role in Federal Racketeering ConspiracyRead the Press Release
Defendants among 91 Charged in Operation Wax House
CHARLOTTE, N.C. – Matthew Newland, 41, of Iowa, was sentenced on Tuesday, January 27, 2015, by Senior U.S. District Judge Graham C. Mullen to serve 13 months in prison followed by one year of supervised release on federal racketeering charges, announced the U.S. Attorney’s Office for the Western District of North Carolina. Four other defendants were sentenced earlier this month.
The U.S. Attorney’s Office is joined in making today’s announcement by John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, Thomas J. Holloman III, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division (IRS-CI).
These convictions are the latest in Operation Wax House, an investigation which began in 2007. Of the 91 individuals charged, eighty-nine defendants have either pleaded guilty or have been convicted following trial. The two remaining defendants are international fugitives.
According to court records and Tuesday’s sentencing hearing, Newland operated as a promoter in the conspiracy and received more than $400,000 in kickbacks for his role. Newland also served as a seller in one transaction, letting approximately $240,000 in kickbacks be paid out of the loan proceeds to his co-conspirators. Newland pled guilty to RICO conspiracy to commit bank fraud in June 2013.
The other five defendants sentenced this month are:
• On January 27, 2015, Lorie Dooley, 50, of Charlotte, N.C., was sentenced to 46 months in prison, followed by three years of supervised release. Dooley was also a promoter in the enterprise’s mortgage fraud operations and received approximately $25,000 in kickbacks for her role. In addition to the mortgage fraud, Dooley engaged in a bank bribery scheme, in which she received $63,000 from a co-conspirator and paid a bank employee $55,000 to provide a bogus letter of credit. Also, when Dooley learned that the bank employee had pleaded guilty, Dooley obstructed justice, attempting to threaten and intimidate that employee. Dooley pleaded guilty to RICO conspiracy to commit bank fraud, wire fraud, and money laundering conspiracy in January 2014. She has been in custody since her arrest on these charges in May 2013.
• On January 20, 2015, Travis Bumpers, 38, of Charlotte, was sentenced to 66 months in prison and three years of supervised release. Bumpers was a promoter in both the enterprise’s mortgage fraud and investment fraud operations. Bumpers engaged in multiple mortgage fraud transactions, arranging for a straw buyer, providing down payment money, and receiving more than $800,000 in kickback money through a sham corporation. Bumpers also engaged in extensive investment fraud, defrauding approximately 70 victims out of more than $4.6 million. Bumpers pleaded guilty to RICO conspiracy to commit securities fraud, bank fraud, wire fraud and money laundering conspiracy in March 2013. He has been in custody since his arrest on these charges in November 2012.
• On January 8, 2015, Ralph Johnson, 37, of Charlotte, was sentenced to 27 months in prison and two years of supervised release. Johnson was a promoter in the enterprise’s mortgage fraud operations, helping arrange multiple fraudulent transactions and provide straw buyers in exchange for approximately $360,000 in kickbacks. Johnson pleaded guilty to RICO conspiracy to commit bank fraud, wire fraud, and money laundering conspiracy in June 2013. He has been in custody since his arrest on these charges in April 2013.
• Also on January 8, 2015, Benjamin Clarke, 41, of Atlanta, Ga. was sentenced to an eight month split sentence, followed by two years of supervised release. Clarke served the enterprise as a buyer for two properties purchased as part of its mortgage fraud operations and received approximately $200,000 in kickbacks. Clarke pleaded guilty to bank fraud in June 2013. Of the 26 six defendants charged in this indictment, 18 await sentencing, including three of the scheme’s leaders. The fourth leader, Ramin Amini, 46, last known address Tehran, Iran, is one of two international fugitives. Operation Wax House in the Western District of North Carolina is being handled by the Charlotte Division of the FBI and the Criminal Division of the IRS for the Financial Fraud Enforcement Task Force, along with the Securities Division of the North Carolina Secretary of State with respect to a separate prosecution. The Operation Wax House prosecution is being handled for the government by Assistant United States Attorney Maria K. Vento.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Since the inception of FFETF in November 2009, the Justice Department has filed more than 12,841 financial fraud cases against nearly 18,737 defendants including nearly 3,500 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
The names and case numbers of the all the defendants charged to date in Operation Wax House are listed below, organized by their alleged role in the scheme.
Final Two Defendants Plead Guilty to Theft from Federally Licensed Firearms DealerRead the Press Release
The Defendants Stole 26 Firearms from U.S. Lumber Company in Battle Creek
GRAND RAPIDS, MICHIGAN – Matthew Cameron Day Bolden, 24, and William Henry Watson, 22, both of Battle Creek, Michigan, pled guilty on January 28 in the U.S. District Court for the Western District of Michigan to one count of theft of firearms from a federally licensed dealer as detailed in an indictment returned on October 16, 2014, U.S. Attorney Patrick Miles announced today. James Maurice Lucas, 19, also of Battle Creek, previously pled guilty to the theft on November 14, 2014.
Late in the evening on September 6, 2014, the three men, armed with two semiautomatic pistols, broke into U.S. Lumber Company in Battle Creek, which was closed for the day. They shattered display cases containing semiautomatic pistols and revolvers, and fled the store with 26 firearms. Officers from the Battle Creek Police Department, responding to an alarm, apprehended Bolden and Watson at the scene. Lucas was arrested at a later date. Twenty-four of the firearms have been recovered.
“Stealing firearms from a federally licensed dealer is not only a dangerous crime in and of itself, but those stolen firearms can later pose a deadly threat to the public,” said U.S. Attorney Miles. “This office continues to protect the public by enforcing federal firearms law.”
“Anytime guns are stolen, the community is placed at risk,” said ATF Special Agent in Charge Steven Bogdalek. “Theft of firearms from a federally licensed firearms dealer is one of the most serious federal crimes as the guns typically end up in the hands of violent criminals. ATF, along with our local, state and federal partners remain committed to aggressively investigating these crimes.”
Chief of Police Jim Blocker of the Battle Creek Police Department said, “This incident once again validates the importance of open and joint investigations with our Federal and State law enforcement agencies. The Battle Creek Police Department has retained a long-time position on the ATF Task Force, and this case demonstrates why this remains so vital to our mission. As a local department, we naturally operate with limited resources, and we remain grateful that our Federal and State partners are so willing to assist the Battle Creek Police Department.”
Bolden and Watson will be sentenced in June and Lucas will be sentenced in March. Each faces up to 10 years’ imprisonment and a fine of up to $250,000.00.
The Bureau of Alcohol, Tobacco, Firearms, and Explosives (“ATF”) conducted the investigation along with the Battle Creek Police Department. Assistant U.S. Attorney Justin M. Presant is prosecuting the case. The prosecution was coordinated with the Calhoun County Prosecuting Attorney.
Final Two Defendants Plead Guilty to Theft from Federally Licensed Firearms DealerRead the Press Release
The Defendants Stole 26 Firearms from U.S. Lumber Company in Battle Creek
GRAND RAPIDS, MICHIGAN – Matthew Cameron Day Bolden, 24, and William Henry Watson, 22, both of Battle Creek, Michigan, pled guilty on January 28 in the U.S. District Court for the Western District of Michigan to one count of theft of firearms from a federally licensed dealer as detailed in an indictment returned on October 16, 2014, U.S. Attorney Patrick Miles announced today. James Maurice Lucas, 19, also of Battle Creek, previously pled guilty to the theft on November 14, 2014.
Late in the evening on September 6, 2014, the three men, armed with two semiautomatic pistols, broke into U.S. Lumber Company in Battle Creek, which was closed for the day. They shattered display cases containing semiautomatic pistols and revolvers, and fled the store with 26 firearms. Officers from the Battle Creek Police Department, responding to an alarm, apprehended Bolden and Watson at the scene. Lucas was arrested at a later date. Twenty-four of the firearms have been recovered.
“Stealing firearms from a federally licensed dealer is not only a dangerous crime in and of itself, but those stolen firearms can later pose a deadly threat to the public,” said U.S. Attorney Miles. “This office continues to protect the public by enforcing federal firearms law.”
“Anytime guns are stolen, the community is placed at risk,” said ATF Special Agent in Charge Steven Bogdalek. “Theft of firearms from a federally licensed firearms dealer is one of the most serious federal crimes as the guns typically end up in the hands of violent criminals. ATF, along with our local, state and federal partners remain committed to aggressively investigating these crimes.”
Chief of Police Jim Blocker of the Battle Creek Police Department said, “This incident once again validates the importance of open and joint investigations with our Federal and State law enforcement agencies. The Battle Creek Police Department has retained a long-time position on the ATF Task Force, and this case demonstrates why this remains so vital to our mission. As a local department, we naturally operate with limited resources, and we remain grateful that our Federal and State partners are so willing to assist the Battle Creek Police Department.”
Bolden and Watson will be sentenced in June and Lucas will be sentenced in March. Each faces up to 10 years’ imprisonment and a fine of up to $250,000.00.
The Bureau of Alcohol, Tobacco, Firearms, and Explosives (“ATF”) conducted the investigation along with the Battle Creek Police Department. Assistant U.S. Attorney Justin M. Presant is prosecuting the case. The prosecution was coordinated with the Calhoun County Prosecuting Attorney.
Final Defendant Sentenced in Odessa Credit Union ATM Theft CaseRead the Press Release
In Midland today, U.S. District Judge Robert A. Junell sentenced 25–year-old Jordan Reese Brashear of Odessa, to 33 months in federal prison for robbing a local credit union ATM announced Acting United States Attorney Richard L. Durbin, Jr., and Federal Bureau of Investigation (FBI) Special Agent in Charge Douglas E. Lindquist, El Paso Division.
In addition to the prison term, Judge Junell ordered that Brashear pay, jointly and severally with co-defendants, $30,262.60 restitution and be placed on supervised release for a period of three years after completing his prison term. Brashear’s co-defendants, 35-year-old Kelly Lee Harjo and 48–year-old Steven Lee Holstead, received two-year federal prison terms for their roles in the ATM theft. All three pleaded guilty to a charge of theft of credit union property.
According to court records, the three defendants used a forklift to steal an ATM from the Complex Community Credit Union on March 5, 2014. The defendants managed to steal over $30,000 from inside the ATM.
This case was investigated by the Federal Bureau of Investigation (FBI) together with the Odessa Police Department. Assistant United States Attorney John Klassen prosecuted this case on behalf of the Government.
Federal and State Authorities Arrest 23 Individuals Today in Relation to Cocaine and Methamphetamine Distribution Operations in Permian BasinRead the Press Release
In Midland and Odessa this morning, authorities arrested 23 individuals on federal drug and firearms charges announced Acting United States Attorney Richard L. Durbin, Jr., Drug Enforcement Administration Special Agent in Charge Will Glaspy, El Paso Division, and Midland Police Chief Price Robinson.
Federal grand jury indictments returned yesterday charge 21 of those arrested, as well as five other individuals who were already in custody prior to today and seven who are still at large, for alleged drug trafficking offenses or federal firearms violations stemming from two separate investigations. Two arrested today were charged by federal criminal complaints filed this morning. A complete list of defendants is below.
In the Cortez investigation, authorities arrested 14 individuals, including 30–year-old ringleader Andrew Cortez of Midland. Cortez is a partial owner and operator of a family business called “Alfredo’s Paleteria” with stores in Midland, Odessa, San Angelo and Fort Stockton. Authorities allege that Cortez, along with his 32-year-old brother, Albert Cortez, used the business operation as fronts for cocaine distribution. According to court records, the defendants allegedly conspired since February 2014 to possess with intent to distribute more than five kilograms of cocaine.
In the Derington investigation, authorities arrested a total of nine individuals on federal drug charges, including ringleader 33-year-old Brandon Derington of Midland. Authorities allege that Derington and the other defendants conspired since February 2014 to possess methamphetamine with intent to distribute it throughout the Permian Basin area. Ruben Long, a 35-year-old Midland resident who was also arrested today, is charged by federal indictment with being a convicted felon in possession of a firearm. Tiffany Thetford, age 26 of Odessa, and Michael Johnson, age 58 of Odessa were two non-indicted individuals arrested this morning in connection with the Derington investigation. Both have been charged by federal criminal complaints following their arrests. Thetford is charged with being a felon in possession of a firearm; Johnson, possession with intent to distribute methamphetamine.
During these investigations, authorities have seized 1.5 kilograms of cocaine, 1.5 kilograms of methamphetamine, 12 firearms, approximately $127,000 in U.S. Currency as well as two additional money seizures of unknown quantity.
“Today’s enforcement operations dismantled two separate but significant drug trafficking organizations involved in the distribution and trafficking of cocaine and methamphetamine in the Permian Basin. Jointly, through the hard work and dedication of our agents along with our federal, state and local law enforcement partners, these criminal organizations will now face west Texas justice,” stated DEA Special Agent in Charge Will Glaspy, El Paso Division.
Upon conviction, the defendants face sentences of between ten years and life in federal prison; between five and 40 years in federal prison; or, up to 20 years in federal prison depending on the amount of controlled substances involved. Thetford and Long each face ten years in federal prison upon conviction of the felon in possession charge. All of the defendants remain in federal custody. Detention hearings are scheduled for February 3, 2015, and February 9, 2015, in Midland before United States Magistrate Judge David Counts.
These federal charges and arrests resulted from investigations conducted by the Drug Enforcement Administration (DEA), Midland Police Department and the Ector County Sheriff’s Office together with the Federal Bureau of Investigation (FBI), Homeland Security Investigations (HSI) and the Midland County Sheriff’s Office. The United States Marshals Service and the Texas Department of Public Safety (DPS) Air Support Unit assisted in making today’s arrests. These matters are being prosecuted by Assistant United States Attorney Brandi Young.
An indictment is merely a charge and should not be considered as evidence of guilt. The defendants are presumed innocent until proven guilty in a court of law.
Cortez investigation defendants
Name Age Residence Charge Exposure
*Andrew Cortez 30 Odessa Conspiracy to PWITD Cocaine 10 years to life
*Jose Dominguez 37 Midland Conspiracy to PWITD Cocaine 5 to 40 years
*Daniel Yearicks 32 Midland Conspiracy to PWITD Cocaine up to 20 years
*Guillermo Borunda 19 Midland Conspiracy to PWITD Cocaine up to 20 years
*Manuel Valensuela 43 Odessa Conspiracy to PWITD Cocaine up to 20 years
*Albert Cortez 32 Odessa Conspiracy to PWITD Cocaine up to 20 years
*Fidel Segura 23 Midland Conspiracy to PWITD Cocaine up to 20 years
*Benito Sanchez 44 Midland Conspiracy to PWITD Cocaine up to 20 years
*Ramiro Castillo 56 Midland Conspiracy to PWITD Cocaine up to 20 years
*Jose Valenzuela 39 Odessa Conspiracy to PWITD Cocaine up to 20 years
*Curtis White 28 Midland Conspiracy to PWITD Cocaine up to 20 years
*Raul Saldana 22 Odessa Conspiracy to PWITD Cocaine 10 years to life
*Jose Gardea 25 Odessa Conspiracy to PWITD Cocaine 10 years to life
*Miriam Saenz 30 Odessa Conspiracy to PWITD Cocaine up to 20 years
**Avelardo Castillo 25 Stanton, TX Conspiracy to PWITD Cocaine up to 20 years
***Alejandro Esquivel 40 Odessa Conspiracy to PWITD Cocaine 10 years to life
***Gabriel Miller 30 Denver City Conspiracy to PWITD Cocaine 5 to 40 years
***Paul Hicks 34 Midland Conspiracy to PWITD Cocaine 10 years to lifeDerington investigation defendants
Name Age Residence Charge Exposure
*Brandon Derington 33 Odessa Conspiracy to PWITD Meth 10 years to life
*Chris Wayne Grimes 41 Odessa Conspiracy to PWITD Meth 10 years to life
*Steven Egge 45 Odessa Possess w/Intent To Distribute Meth up to 20 years
*John Steven Renfro 48 Big Spring, TX Conspiracy to PWITD Meth up to 20 years
*Jeffrey Lynn Lane 52 Odessa Conspiracy to PWITD Meth up to 20 years
*Lacy Brooks 32 Odessa Conspiracy to PWITD Meth up to 20 years
*Ruben Long 35 Odessa Felon in possession of firearm 10 years
*Michael Johnson 58 Odessa Possess w/Intent To Distribute Meth up to 20 years
*Tiffany Thetford 26 Odessa Felon in possession of firearm 10 years
**Sherry Ledford 44 Midland Conspiracy to PWITD Meth up to 20 years
**Olivia Ramon 18 Odessa Conspiracy to PWITD Meth 10 years to life
**Juan Martin Arteaga 44 Odessa Conspiracy to PWITD Meth 10 years to life
**Eddie Herbert Alviso 62 Riverside, CA Conspiracy to PWITD Meth 10 years to life
***Bryant Douglas Black 50 California Conspiracy to PWITD Meth 10 years to life
***Danny Ray Blakely 28 Odessa Conspiracy to PWITD Meth up to 20 years
***Wesley Williford 41 Odessa Conspiracy to PWITD Meth up to 20 years
***Ruben Mancha 53 Andrews, TX Possess w/Intent To Distribute Meth up to 20 years* Arrested today
** Already in custody prior to today
*** FugitiveFederal Jury Convicts Former Finance Manager of the Rocky Boy Health ClinicRead the Press Release
GREAT FALLS – The former Finance Manager of the Rocky Boy Health Board Clinic in Box Elder, Theodora Ann Morsette, 60, was convicted of three felony counts of embezzlement and theft for taking over $156,000 in federal monies provided to the tribe for the operation and services of the Clinic. Judge Brian Morris of Great Falls set sentencing for April 20, 2015.
Morsette had worked in the Finance Office of the Clinic since 1994. The prosecution presented evidence that between 2010 and 2013, Morsette regularly accessed tribal coffers for payments over and above her $90,000 per year salary and authorized supplemental compensation package with the Chippewa Cree Tribe. Morsette received a base pay of $82,000 per year plus a retirement benefit of 11.5% plus a negotiated supplemental pay stipend from the tribe. Over the four year period reviewed by investigators, Morsette obtained an additional $156,493 in unauthorized overtime, double pay, severance pay [although she never severed her government service], unauthorized supplemental pay, and retirement advances. Morsette testified that she believed that she was entitled to the additional payments because she worked hard and the over-payments had been approved by her supervisor, Clinic CEO Fawn Tadios.
Tadios was indicted and convicted of embezzling tribal funds in June of 2014. Judge Morris sentenced Tadios to a year in prison on October 22, 2014. She has appealed her conviction and was released pending appeal by the Ninth Circuit Court of Appeals. Morsette has been released pending sentencing.
Prior to working at the Health Clinic’s Finance Office, Morsette had been a Bureau of Indian Affairs loan officer. She was indicted and convicted of embezzling $6,453 in 1994 and given a three year sentence of probation.
The guilty verdict is the latest in a series of prosecutions and convictions relating to public corruption, fraud, and theft in federal grants, contracts and programs in Indian Country brought by the investigators and prosecutors of the U.S. Attorney’s Guardians Project, an anti-corruption strike force created in 2011. The primary investigators in the Morsette case were the agents of the Department of Health and Human Services’ Office of Inspector General (HHS OIG), aided and supported by the HHS OIG’s Office of Audit Services, and agents of the Offices of Inspector General for Interior and the Environmental Protection Agency.
Special Agent in Charge Gerald T. Roy, U.S. Department of Health and Human Services, Office of Inspector General, Office of Investigations, Kansas City Regional Office, stated “Our office will continue to bring those individuals to justice who defraud our programs for personal benefit and at the expense of those in need of assistance.”
Fairfield Man Who Possessed Assault Weapon on Unh Campus Is SentencedRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that WILLIAM DONG, 23, of Fairfield, was sentenced today by U.S. District Judge Robert N. Chatigny in Hartford to five years of probation for transporting an assault weapon into Connecticut in violation of federal law.
According to court documents and statements made in court, in September 2013, DONG traveled to Pennsylvania, purchased a Bushmaster model XM-15-E2S, .223 caliber semi-automatic rifle and transported the rifle back to Connecticut. This firearm is considered a prohibited assault weapon under Connecticut state law.On December 3, 2013, West Haven Police arrested DONG in the vicinity of the University of New Haven (UNH) after he was found in possession of two handguns on his person, and the Bushmaster rifle, which was seized from his nearby car. DONG, a UNH student, told police that he had purchased the rifle from a seller in Pennsylvania in September 2013 through an advertisement placed on www.armslist.com.
Although it is not unlawful under federal law for an individual, who is not a prohibited person, to possess this Bushmaster firearm, it is a federal violation for an individual to purchase this firearm outside of Connecticut and travel into the state with it, since it is a prohibited firearm under Connecticut state law.
DONG has been detained since his arrest. He has stated that he possessed the firearms out of concern for his safety and the safety of his fellow UNH students.
DONG pleaded guilty to the federal charge on November 6, 2014. He also previously pleaded guilty in Milford Superior Court to state firearms offenses related to the December 2013 incident in West Haven, and has been sentenced to eight years of incarceration, execution suspended after two years, and five years of probation.
In the federal case, DONG faced a sentencing guideline range of six to 12 months of imprisonment. Instead of imposing a sentence of incarceration, and which would be followed by a term of supervised of up to three years, Judge Chatigny imposed a five-year term of probation, the maximum allowed under the law. Judge Chatigny agreed with the government’s position that DONG’s state term of incarceration is sufficient, but that a longer period of federal supervision is necessary to insure the safety of the community.
As special conditions of probation, Judge Chatigny ordered that DONG cannot possess any firearms or ammunition, associate with individuals in possession of firearms or go to any shooting ranges. He also must submit to mental health counseling.
“A sentence of five years of probation with mental health counseling is an appropriate resolution to this case, as it will provide Mr. Dong with needed federal supervision,” stated U.S. Attorney Daly. “We want to thank the conscientious citizen who first alerted law enforcement that an individual was in possession of a powerful and potentially dangerous firearm. We also want to acknowledge the rapid response of the West Haven Police and University of New Haven Police, which quickly resolved this unsettling situation.”
This matter was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, West Haven Police Department, University of New Haven Police Department and Connecticut State Police. The case was prosecuted by Assistant U.S. Attorney Robert M. Spector.
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[email protected]El Salvador National Pleads Guilty and Sentenced for Illegally ReentryRead the Press Release
U.S. Attorney Kenneth A. Polite announced that LISANDRO HUMBERTO BAIRES-GOMEZ, age 20, a citizen of El Salvador, pled guilty on Tuesday, January 27, 2015, to a one-count Indictment for illegal reentry of removed alien.
According to the Indictment, on or about November 17, 2014, BAIRES-GOMEZ was found in the United States after having been officially deported and removed on or about June 13, 2013.
After accepting his guilty plea, U.S. District Judge Jay C. Zainey sentenced BAIRES-GOMEZ to time served, ordered him to serve one year of supervised release, and pay a special assessment of $100. BAIRES-GOMEZ will be surrendered to the custody of the U.S. Immigration & Customs Enforcement for removal proceedings.
U.S. Attorney Polite praised the work of the United States Department of Homeland Security, U.S. Border Patrol in investigating this matter. Assistant United States Attorney Spiro G. Latsis was in charge of the prosecution.
Eagle Butte Man Sentenced for Possession of A Firearm by Prohibited PersonRead the Press Release
United States Attorney Brendan V. Johnson announced that an Eagle Butte, South Dakota, man convicted of Possession of a Firearm by a Prohibited Person was sentenced on January 26, 2015, by U.S. District Judge Roberto A. Lange.
Philip Nordvold, age 36, was sentenced to 16 months in custody, 2 years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Nordvold was indicted for Possession of a Firearm by a Prohibited Person by a federal grand jury on August 19, 2014. He pled guilty to the charge on October 21, 2014.
The conviction arose from an incident in February 2014, when Cheyenne River Sioux Tribe law enforcement officers found Nordvold asleep in a parked vehicle. The officers knocked on the window of the vehicle to awaken Nordvold, and one of the officers observed a handgun on the seat by Nordvold’s hand. The vehicle was then searched and a 9mm semi-automatic pistol was located under the driver’s seat. Nordvold had previously been convicted of a crime punishable by imprisonment for more than one year, and was therefore a person prohibited from possessing a firearm.
This case was investigated by the Cheyenne River Sioux Tribe Law Enforcement Division and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney Mikal Hanson prosecuted the case.
Nordvold was immediately turned over to the custody of the U.S. Marshals Service to begin serving his sentence.
D’iberville Man Sentenced to Prison for Oil Spill Fraud ConspiracyRead the Press Release
Gulfport, Miss. – Jason Richard Woodcock, 34, of D’Iberville, was sentenced on January 26, 2015 by U.S. District Judge Sul Ozerden to 120 months in federal prison followed by three years of supervised release for conspiracy to commit mail and wire fraud, U.S. Attorney Gregory K. Davis announced. Woodcock was also ordered to pay restitution to the Gulf Coast Claims Facility (GCCF) in the amount of $105,383.76 and to the Mississippi Department of Employment Security (MDES) in the amount of $17,092.00.
The investigation revealed that Woodcock and co-conspirators filed fraudulent oil spill claims with the GCCF in support of Woodcock and other individuals’ fraudulent claims scheme for alleged lost earnings and profits as a result of the oil spill in the Gulf of Mexico on or about April 20, 2010. Woodcock alleged loss of employment as a marketing representative at JW Consulting LLC in Gulfport and he conspired to submit other oil spill claims for other individuals from another non-existent company known as "Gulf South Seafood". Through mailings and wire transactions, the conspiracy resulted in the actual loss of $105,383.76, with the total intended loss to the GCCF being $420,816.88.
This case was investigated by special agents of the United States Secret Service and the United States Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations. It was prosecuted by Assistant U.S. Attorney Andrea Jones.
This case was also brought as part of this District’s partnership with the National Center for Disaster Fraud (NCDF), a nationwide initiative to protect available funds and assistance for those victims of both natural and man-made disasters such as hurricanes, floods, tornadoes and the recent Gulf oil spill. If you have knowledge of fraud, waste, abuse, or allegations of mismanagement involving disaster relief operations, you can contact the NCDF by either calling the hotline at
(866) 720-5721, faxing (225) 334-4707, emailing at [email protected] or in writing to National Center for Disaster Fraud, Baton Rouge, LA 70821-4909.
Doctor Sentenced to 16 Months in Prison for Taking Bribes in Test-Referral Scheme with New Jersey Clinical LabRead the Press Release
NEWARK, N.J. – An internist with a practice in Montclair, New Jersey, was sentenced today to 16 months in prison for accepting bribes in exchange for test referrals as part of a long-running scheme operated by Biodiagnostic Laboratory Services LLC (BLS), of Parsippany, New Jersey, its president and numerous associates, U.S. Attorney Paul J. Fishman announced.
Charles Goldberg, 61, of West Orange, New Jersey, previously pleaded guilty before U.S. District Judge Stanley R. Chesler to an information charging him with one count of accepting bribes. Judge Goldberg imposed the sentence today in in Newark federal court.
Including Goldberg, 34 people – 23 of them physicians– have pleaded guilty in connection with the bribery scheme, which its organizers have admitted involved millions of dollars in bribes and resulted in more than $100 million in payments to BLS from Medicare and various private insurance companies.According to documents filed in these and related cases and statements made in court:
Goldberg admitted accepting bribes of $1,800 per month through a sham lease agreement with BLS, which identified the waiting room, bathroom and one examination room in Goldberg’s office as being leased.In addition to the prison term, Judge Chesler sentenced Goldberg to one year of supervised release and fined him $50,000. As part of his guilty plea, Goldberg must forfeit $58,000, representing the bribes he received from BLS.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford; U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert; IRS – Criminal Investigation, under the direction of Acting Special Agent in Charge Jonathan D. Larsen; and inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge Maria L. Kelokates, with the ongoing investigation leading to today’s sentencing.
The government is represented by Senior Litigation Counsel Andrew Leven, Assistant U.S. Attorney Joseph Minish, and Jacob T. Elberg, Chief of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark, as well as Assistant U.S. Attorney Barbara Ward of the office’s Asset Forfeiture and Money Laundering Unit.
U.S. Attorney Paul J. Fishman reorganized the health care fraud practice at the New Jersey U.S. Attorney’s Office shortly after taking office, including creating a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since 2010, the office has recovered more than $635 million in health care fraud and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Food, Drug and Cosmetic Act and other statutes.
Defense counsel: A. Ross Pearlson Esq., West Orange
15-036Doctor Admits Taking Bribes in Test-Referral Scheme New Jersey Clinical LabRead the Press Release
NEWARK, N.J. – A Monmouth County doctor with practices in Colts Neck, New Jersey, and Staten Island, New York, today admitted accepting bribes in exchange for test referrals as part of a long-running and elaborate scheme operated by Biodiagnostic Laboratory Services LLC (BLS), of Parsippany, New Jersey, its president and numerous associates, U.S. Attorney Paul J. Fishman announced.
Ralph Messo, 53, of Colts Neck, New Jersey, pleaded guilty before U.S. District Judge Stanley R. Chesler in Newark federal court to an information charging him with one count of accepting bribes.
Including Messo, 34 people – 23 of them doctors – have pleaded guilty in connection with the bribery scheme, which its organizers have admitted involved millions of dollars in bribes and resulted in more than $100 million in payments to BLS from Medicare and various private insurance companies. The investigation has so far recovered more than $10.5 million to date through forfeiture.According to documents filed in this and related cases and statements made in court:
Messo admitted he accepted bribes in return for referring patient blood specimens to BLS and was paid approximately $3,000 per month. Messo’s referrals generated at least $828,000 in lab business for BLS.
On April 9, 2013, federal agents arrested David Nicoll, 40, of Mountain Lakes, New Jersey, Scott Nicoll, 33, of Wayne, New Jersey, a senior BLS employee and David Nicoll’s brother, and Craig Nordman, 35, of Whippany, New Jersey, a BLS employee and the CEO of Advantech Sales LLC – one of several entities used by BLS to make illegal payments. They were charged by federal complaint with the bribery conspiracy, along with the BLS company and Frank Santangelo, 44, of Boonton, New Jersey. In June 2013, David and Scott Nicoll, Nordman and four other associates of BLS pleaded guilty to charges related to their involvement. Santangelo, a doctor, pleaded guilty in August 2013 to charges relating to his role in the scheme
The bribery count to which Messo pleaded guilty carries a maximum potential penalty of five years in prison and a $250,000 fine. Sentencing is scheduled for May 12, 2015. As part of his guilty plea, Messo must forfeit $82,500, representing the total bribe monies received from BLS.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford; U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert; IRS– Criminal Investigation, under the direction of Acting Special Agent in Charge Jonathan D. Larsen; and inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge Maria L. Kelokates, with the ongoing investigation leading to today’s guilty pleas.
The government is represented by Assistant U.S. Attorney Joseph Minish, Senior Litigation Counsel Andrew Leven, and Jacob T. Elberg, Chief of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark, as well as Assistant U.S. Attorney Barbara Ward of the office’s Asset Forfeiture and Money Laundering Unit.
U.S. Attorney Paul J. Fishman reorganized the health care fraud practice at the New Jersey U.S. Attorney’s Office shortly after taking office, including creating a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since 2010, the office has recovered more than $635 million in health care fraud and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Food, Drug and Cosmetic Act and other statutes.
15-038Defense counsel: Joseph R. Benfante Esq., New York
Couple Sentenced for Stealing Mail in Roanoke, Southlake, and Keller, TexasRead the Press Release
DALLAS — A couple who admitted stealing mail from residential mailboxes in and around Roanoke, Southlake, and Keller, Texas, were sentenced this week, announced John Parker, Acting U.S. Attorney for the Northern District of Texas.
William Lee Maglicco, 28, was sentenced by U.S. District Judge Reed C. O’Connor to 30 months in federal prison. Erica Michele Gibson, 26, was sentenced to 41 months in federal prison. Each pleaded guilty in October 2014 to an indictment charging one count of possession of stolen mail. Each has been in custody since their arrest in August 2014 on charges outlined in a related criminal complaint.
According to documents filed in the case, in early 2014, individuals from Roanoke, Southlake, and Keller complained that mail was stolen from their residential mailboxes. One of the victims stated that an American Express card was mailed to him/her at his/her Southlake address, but it was never received. U.S. Postal Inspectors investigated and discovered that Maglicco and Gibson used this individual’s credit card at a Walmart store in Grapevine, Texas, in March 2014.
On April 11, 2014, law enforcement executed a search warrant at Maglicco’s residence in Watauga, Texas, and discovered hundreds of pieces of stolen mail, including credit/debit cards, bank statements, passports and tax information. Law enforcement also found mail at the location addressed to the above-reference victim.
Both Maglicco and Gibson confessed to stealing mail from residential mailboxes in and around Roanoke, Southlake, and Keller, and using the stolen credit/debit cards to purchase items. According to the affidavit filed with the complaint, Maglicco admitted he stole mail approximately two to three times per week with his girlfriend, Gibson. He stated he stole mail to fuel his and Gibson’s drug habit.
The U.S. Postal Inspection Service and the Roanoke, Southlake, and Keller Police Departments investigated. Assistant U.S. Attorney Chris Wolfe prosecuted.
Corporation and Two Owners Sentenced for Scheme to Illegally Dispose of Industrial WastewaterRead the Press Release
BATON ROUGE, LA - United States Attorney Walt Green announced today that Senior U.S. District Judge James J. Brady has sentenced RAM ENVIRONMENTAL SERVICES, LLC, RAYMOND MARCEL, JR., and CYRIL D. ROBICHEAUX, for their roles in a criminal scheme to violate the federal environmental laws.
In June 2013, the three defendants pled guilty to bills of information charging them with a conspiracy to defraud the U.S. Environmental Protection Agency and to violate the Safe Drinking Water Act. In connection with their convictions, the defendants had admitted that, in 2011 and 2012, they conspired with themselves and others to illegally discharge industrial wastewater at locations in Belle River, Louisiana, and Baton Rouge, Louisiana, and to otherwise obstruct the enforcement of the federal environmental laws through kickbacks, the creation and use of false documents, and other fraudulent means.
RAM ENVIRONMENTAL SERVICES, LLC, an entity incorporated in the State of Louisiana and doing business in Morgan City, Louisiana, was sentenced today to make restitution in the amount of $114,969.13 to FAS Environmental Services (“FAS”), based in Belle River, Louisiana, a transportation and disposal company that is primarily in the business of transporting industrial wastewater using a fleet of tanker trucks. RAM was also sentenced to pay a $50,000 fine and a $400 special assessment. RAM was also placed on federal probation for a term of two (2) years.
MARCEL, age 62, of Berwick, Louisiana, was sentenced to a 2-year term of probation, a $1,500 fine, restitution in the amount of $114,969.13 to FAS, and a $100 special assessment. ROBICHEAUX, age 53, of Morgan City, Louisiana, was also sentenced to a 2-year term of probation, a $5,000 fine, full restitution to FAS, and a special assessment.
Today’s sentencing hearings were preceded by the sentencing of Michael J. Vaughn, who was sentenced in October 2013 to twelve (12) months of incarceration at a federal half-way house, a 5-year term of probation, forfeiture of approximately $23,000, and restitution to FAS. In a related case, Roger J. Dies of Zachary, Louisiana is awaiting sentencing as a result of his convictions for failing to report third party wastewater discharges in violation of the Clean Water Act, and obstruction of justice.
U.S. Attorney Green stated, “We will continue to pursue those who commit criminal violations of the federal environmental laws and devote the necessary resources to successfully handle such complex matters. Violators in this district should expect to become convicted felons facing stiff penalties.”
“The defendants admitted they conspired to illegally dispose of huge quantities of industrial wastewaters,” said Daniel Pflaster, Assistant Special Agent-in-Charge of EPA’s criminal enforcement program in Louisiana. “Today’s sentence shows that when businesses and their owners break environmental laws and defraud honest businesses who pay to have their wastes disposed of legally, they will be prosecuted.”
“The sentencing today is a testament to the hard work and dedication amongst our agency and our federal, state and local law enforcement partners, who work together to bring violators to justice,” said DEQ Secretary Peggy Hatch. “The legal handling, treatment and disposal of wastewater are very serious matters, as violations have a negative, direct impact to our health and environment. We will continue to aggressively prosecute individuals and businesses found to be in violation of environmental laws through illegal disposal methods. Anyone with information on illegal activity is asked to contact DEQ and local law enforcement so that we may initiate an investigation as soon as possible.”
U.S. Attorney Green emphasized that FAS ownership was unaware of the defendants’ scheme. FAS terminated the employment of Vaughn, its former operations manager, upon learning of the scheme and cooperated fully.
The matter is being conducted by the United States Attorney’s Office, the Criminal Investigation Division of the U.S. Environmental Protection Agency, and the Criminal Investigation Division of the Louisiana Department of Environmental Quality. The matter is being prosecuted by First Assistant U.S. Attorney Corey R. Amundson, who serves as Chief of the Criminal Division, and Assistant U.S. Attorney Alan A. Stevens, who serves as a Deputy Chief.
Connecticut Hedge Fund Adviser Sentenced to 13 Years in Federal Prison for Running Massive Ponzi SchemeRead the Press Release
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FRANCISCO ILLARRAMENDI, 45, formerly of New Canaan, was sentenced today by U.S. District Judge Stefan R. Underhill in Bridgeport to 156 months of imprisonment, followed by three years of supervised release, for orchestrating a Ponzi scheme that defrauded investors and creditors of hedge funds he managed out of hundreds of millions of dollars, and for obstructing the ensuing investigation of his conduct.
“For more than five years, Francisco Illarramendi’s severely misguided attempt to conceal an initial loss of $5 million ballooned into an elaborate fraud scheme that caused investors and creditors to lose hundreds of millions of dollars,” stated First Assistant U.S. Attorney Michael J. Gustafson. “Through it all, he still managed to live well, receiving more than $20 million in personal benefits. I want to thank our partners at the FBI and SEC for unravelling this complex scheme, and acknowledge the efforts of the court-appointed receiver who has recovered more than $300 million that will be distributed to the victims.”
“Mr. Illarramendi violated his fiduciary duties by swindling millions from investors,” stated Patricia M. Ferrick, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation. “This case sends a clear message that no one is above the law, least of all those in the securities industry.”
On March 7, 2011, ILLARRAMENDI pleaded guilty to two counts of wire fraud, one count of securities fraud, one count of investment advisor fraud, and one count of conspiracy to obstruct justice, to obstruct an official proceeding and to defraud the U.S. Securities and Exchange Commission (SEC).
According to court documents and statements made in court, in 2005, ILLARRAMENDI founded and became a partner in Highview Point Partners (“HVP”) and began acting as an investment adviser to certain hedge funds. HVP was registered with the SEC as an investment advisor and eventually relocated from New York City to Stamford. In 2006, ILLARRAMENDI founded, and became a partner in, Michael Kenwood (“MK”), which was also located in Stamford, but was not registered with the SEC. In late 2005, one hedge fund he advised lost approximately $5 million of the money he was charged with investing. Rather than disclose to his investors the truth about the losses incurred, ILLARRAMENDI concealed this information by engaging in a scheme to defraud and mislead his investors and creditors. As a result of the scheme, the hedge funds and related entities managed and advised by ILLARRAMENDI had outstanding liabilities that greatly exceed the true value of their assets, causing the funds’ investors, creditors and service providers to lose more than $700 million.
As part of the scheme to defraud investors, creditors and, ultimately, the SEC, ILLARRAMENDI created fraudulent documents, including a bogus debt instrument and a phony letter purporting to have been issued by an investment bank, as well as a fictitious asset verification letter falsely representing that one of the hedge funds, the Short Term Liquidity Fund (“STLF”), had at least $275 million in credits as a result of outstanding loans, when ILLARRAMENDI and others knew it did not have any such credits. In addition, ILLARRAMENDI misled investors, creditors and the SEC about the true performance of the funds, the assets under management by the funds and the transactions being conducted by the funds and related entities. At times, ILLARRAMENDI used money provided by new investors to the funds to pay out the returns he promised to earlier investors, made false representations to his investors and creditors in an effort to obtain new investments from them and to prevent them from seeking to liquidate their investments, improperly commingled the investments in each individual hedge fund with investments in the other hedge funds, and engaged in transactions that were not in the best interests of the funds.
In order to keep his fraud hidden, and to secure an investment of approximately $100 million, ILLARRAMENDI paid $3.4 million in bribes to two officials of the Venezuelan state-owned oil company, Petroleos de Venezuela, S.A. (“PDVSA”). ILLARRAMENDI also paid a Venezuelan accountant, Juan Carlos Guillen Zerpa, and a purported Florida businessman, Juan Carlos Horna Napolitano, $1.25 million to assist him in the creation of the fictitious asset verification letter that falsely represented that STLF had at least $275 million in credits as a result of outstanding loans. ILLARRAMENDI used the letter in an attempt to mislead and deceive the SEC regarding whether there was sufficient capital and credit to protect the investors of STLF.
ILLARRMENDI personally obtained more than $20 million during the course of the scheme, and used approximately $5 million of the funds to construct a home in New Canaan.
On January 14, 2011, the SEC filed a civil action seeking, among other things, to enjoin ILLARRAMENDI and MK-related entities from violating the federal securities laws and to submit an accounting of investor funds. Subsequent to the filing of the SEC civil action, U.S. District Judge Janet Bond Arterton appointed, and sought input from, business advisers and a court-appointed receiver to ascertain the assets and liabilities of the hedge funds affiliated with MK, among other tasks.
To date, the court-appointed receiver has recovered more than $300 million of the funds that were lost, including the vast majority of the bribe payments. The receiver also has sold ILLARRAMENDI’s New Canaan residence for approximately $3 million.
Judge Underhill will issue a restitution order after further court proceedings.
ILLARRAMENDI has been detained since January 25, 2013, after his bond was revoked, in part because he had failed to disclose to the Court that he had received and spent a Connecticut state tax refund of more than $630,000 while he was awaiting sentencing.
Guillen and Horna both pleaded guilty to conspiring to obstruct an SEC proceeding, received prison terms of 14 months and forfeited the $1.25 million they received from ILLARRAMENDI.
This matter was investigated by the Federal Bureau of Investigation with the assistance of the U.S. Securities and Exchange Commission, Boston Regional Office, and Internal Revenue Service – Criminal Investigation Division.
The case was prosecuted by Senior Litigation Counsel Richard J. Schechter and Assistant U.S. Attorney Paul A. Murphy, with the assistance of the U.S. Attorney’s Office for the District of Massachusetts.
Citizens are encouraged to report any financial fraud schemes by calling, toll free, 855-236-9740, or by sending an email to [email protected].
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Columbian National Pleads Guilty to Illegally ReentryRead the Press Release
U.S. Attorney Kenneth A. Polite announced that ANTONIO CAICEO-VALENCIA, age 42, a citizen of Columbia, pled guilty yesterday to a one-count Indictment for illegal reentry of removed alien.
According to the Indictment, on or about November 20, 2014, CAICEO-VALENCIA was found in the United States after having been officially deported and removed on or about December 27, 2010.
CAICEO-VALENCIA faces an enhanced maximum term of imprisonment of twenty years, a fine of $250,000, three years supervised release after imprisonment, and a $100 special assessment. U.S. District Judge Helen G. Berrigan set sentencing for May 6, 2015.
U.S. Attorney Polite praised the work of the United States Department of Homeland Security, Immigration and Customs Enforcement and Removal Operations in investigating this matter. Assistant United States Attorney Spiro G. Latsis is in charge of the prosecution.
Columbia Woman Sentenced for $576,000 Mortgage Fraud, Embezzlement SchemesRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that the former branch manager of a Fulton, Mo., company has abeen sentenced in federal court for a $576,000 mortgage fraud and embezzlement scheme at the title company where she was employed.
Terri Lynn Johnson, 50, of Columbia, was sentenced by U.S. District Judge Brian C. Wimes on Wednesday, Jan. 28, 2015, to two years and six months in federal prison without parole. The court also ordered Johnson to pay $405,653 in restitution.
Johnson was hired for a clerical position with Guaranty Land Title Company in 2001, and was eventually promoted to become the branch manager of the Fulton, office after the company was acquired by Landchoice Company, LLC. She remained in that position until her termination on Dec. 4, 2008.
On July 11, 2013, Johnson pleaded guilty to bank fraud and money laundering. Johnson admitted that she engaged in a $300,000 mortgage fraud scheme while she was employed as the Fulton branch manager. Johnson refinanced the mortgage on her residence twice. As a result of the false and fraudulent information provided by Johnson, two banks approved mortgage loans for $175,000 in 2007 and for $125,000 in 2008. The combination of those two loans clearly exceeded the appraised value of Johnson’s residence, which was used to secure both loans.
Johnson also admitted that she embezzled $276,173 from Landchoice. Johnson diverted income checks from Landchoice into a bank account that had been opened for Guaranty Land Title Company and which her employer didn’t know existed. She also diverted escrow funds which had been obtained by Landchoice for loan closings into that account.
Johnson then wrote checks to herself which she deposited into her personal checking account. Johnson wrote checks totaling approximately $59,465 payable to herself or to cash. Johnson also wrote checks to Johnson Gardens (her personal business) totaling approximately $12,500. Johnson also wrote checks believed to be for her personal use totaling approximately $19,916. In addition, Johnson utilized a debit card issued for the account, which she used to access $184,292 from that account for her personal benefit. The total personal benefit realized by Johnson from this embezzlement scheme is estimated to be approximately $276,173.
This case was prosecuted by Supervisory Assistant U.S. Attorney Lawrence E. Miller. It was investigated by the FBI, IRS-Criminal Investigation, the Fulton, Mo., Police Department, the Missouri State Highway Patrol and the Missouri Department of Insurance.
Cleveland Man Indicted for EscapeRead the Press Release
A grand jury returned a one-count indictment charging Kison Robertson, 23, of Cleveland, with escape from Oriana Halfway House, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
If convicted, the defendant’s sentence will be determined by the Court after a review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The case is being prosecuted by Assistant U.S. Attorney Brian M. McDonough following an investigation by agents of the United States Marshals Service.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.
Cleveland Man Charged with Aggravated Identity TheftRead the Press Release
An indictment was filed today charging Najee Muhammad, aka Paul Cook, age 50, of Cleveland, with three counts of aggravated identity theft, and one count of access device fraud, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment charges that Muhammad stole and used the identities of three separate individuals in 2013 and 2014. The indictment further charges that Muhammad knowingly and with the intent to defraud, traffic in and use one or more unauthorized access devices, obtained approximately $31,762 by fraudulently charging merchandise and services on various credit accounts, including Capital One, Dell, Galls Police Equipment, AT&T, CitiBank, Target, Safe Home Security, and Dish Network.If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to the case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The case is being prosecuted by Assistant United States Attorneys Chelsea Rice and Adam Hollingsworth after an investigation by the Federal Bureau of Investigation.An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Chicago Woman Pleads Guilty to Making Hoax Distress Call, Causing U.S. Coast Guard to Launch $13,000 Rescue EffortRead the Press Release
CHICAGO — A Chicago woman pleaded guilty today to a federal crime for making a false report two years ago that a person had fallen into Lake Michigan and was in distress, causing the United States Coast Guard and other first responders to launch a dangerous search and rescue operation that cost the Coast Guard $13,613.
LEONA CHEWNING, 24, was charged earlier this month with one count of communicating a false distress message to the Coast Guard. She pleaded guilty today at her arraignment before U.S. District Judge Charles Norgle in Federal Court in Chicago.
In pleading guilty, Chewning admitted that she knowingly and willfully communicated a false distress message to the Coast Guard resulting in a life-saving attempt when no help was needed.
“Hoax rescue calls are costly and risky for the responding agencies and personnel who put their own lives on the line in an effort to save others,” said Zachary T. Fardon, United States Attorney for the Northern District of Illinois. “We will prosecute those who needlessly make false rescue reports and hold them accountable for their crime,” Mr. Fardon said.
“False distress calls like this one tie up valuable assets and put our crews at risk since we take every distress call seriously,” said Capt. Nicholas Bartolotta, chief of response for the Ninth Coast Guard District. “They impede the ability of first responders like the Coast Guard and our partners to respond to real distress where lives may be on the line. We want to make sure people know the dangers and consequences of knowingly making a hoax call.”
According to Chewning’s plea agreement, about 9:10 p.m. on Feb. 4, 2013, she made an emergency 911 call and reported a person was in distress in the lake near Roger’s Park Beach. The 911 call center transferred the call to the Coast Guard at Calumet Harbor. Chewning related her claim and provided a description of the person whom she reported fell into Lake Michigan. Chewning admitted that at the time she made the call, she knew her report was false.
In response to her call, the Coast Guard and federal and state law enforcement officers responded to Roger’s Park Beach. The Coast Guard initiated a search and rescue team, including launching a government vehicle with an ice and rescue team from the Wilmette Harbor station and a helicopter from the Traverse City, Mich., air station. A diver with the Chicago Fire Department entered the water, near where Chewning claimed a person fell in, to locate the alleged victim, but did not locate any person in the water.
Chewning is free on her own recognizance while awaiting sentencing, which was scheduled for 11:30 a.m. on April 22. She faces a maximum sentence of six years in prison and a $250,000 fine, as well as a civil penalty of $5,000 and mandatory restitution of $13,613. Her plea agreement anticipates an advisory United States Sentencing Guidelines range of 4 to 10 months’ incarceration, and the Court must impose a reasonable sentence.
The government is being represented by Assistant U.S. Attorney Timothy J. Storino.
Plea Agreement
Businessman Sentenced in El Paso for Small Business Administration Contract Fraud SchemeRead the Press Release
In El Paso today, U.S. District Judge Philip R. Martinez sentenced Thomas Gregory Harris of Friendswood, TX, to two years in federal prison for his scheme to defraud the Small Business Administration (SBA) with respect to “Section 8(a) program” contracts announced Acting United States Attorney Richard L. Durbin, Jr., and Federal Bureau of Investigation (FBI) Special Agent in Charge Douglas E. Lindquist, El Paso Division.
In addition to the prison term, Judge Martinez ordered that the former Sr. Vice President for Luster National Inc., pay a $25,000 fine and a $1,600 special assessment. Judge Martinez also ordered that Harris be placed on supervised release for a period of three years after completing his prison term. Harris must surrender by March 3, 2015, to begin serving his prison term.
The SBA administers a program pursuant to the Small Business Act called the “Section 8(a) program” that is intended to promote the business development of companies owned and operated by “socially and economically disadvantaged individuals.” In that program, certain government contracts are sometimes set aside for performance by so-called “8(a) concerns,” that is, business entities whose owners/operators the SBA has determined meet the criteria for being "socially and economically disadvantaged."
In July 2010, the SBA approved a joint venture, called Tropical Luster Joint Venture ("TLJV"), between two business entities: Tropical Contracting, LLC ("Tropical"), which is based in San Antonio, and Luster National, Inc. ("Luster"), which has offices in Houston and California. The SBA had approved Tropical as an 8(a) concern in 2009. Luster was not a qualifying 8(a) concern.
Evidence presented during trial revealed that in 2010 and 2011, Harris, unbeknownst to the SBA, used Tropical’s qualifying 8(a) status to obtain three restricted contracts awarded by the SBA.
In 2011, the SBA awarded Harris and TLJV the “Net Zero contract” at Fort Bliss in El Paso to design and implement a written plan to reduce energy consumption at the base. In January 2012, the U.S. Army paid TLJV approximately $492,000 as compensation for work on the Net Zero contract.
In 2010 and 2011, the SBA awarded Harris and TLJV two separate contracts with the U.S. Army Corps of Engineers (USACE) in Galveston, TX for project management duties as assigned by USACE. From 2010 to 2012, USACE paid TLJV approximately $895,000 as compensation for work on USACE projects.
In all three matters, Tropical, the 8(a) concern, did not manage and control TLJV's performance of the contracts as required by law. In fact, personnel associated with Tropical did no work whatsoever on the contracts. Harris managed and controlled TLJV's entire performance of the contracts. Luster personnel, or subcontractors Luster retained, did all of the work. Had the SBA known that Tropical was not managing and controlling TLJV's work on any of the contracts, it would have disqualified TLJV as an approved 8(a) joint venture, which would have rendered it ineligible for the contracts to perform the work at Fort Bliss or USACE in Galveston.
On September 17, 2014, a federal jury in El Paso convicted Harris of 16 counts of wire fraud.
“Today’s sentencing of Mr. Harris demonstrates the FBI’s dedication and unwavering commitment to investigate and bring to justice those individuals involved in corruption within our community. The FBI will continue to hold accountable vendors and public servants who illegally and unfairly obtain public contracts for their own interests, depriving their constituents of honest services,” stated FBI Special Agent in Charge Douglas E. Lindquist.
This case was investigated by the Federal Bureau of Investigation (FBI) together with the United States Army Criminal Investigation Command, Major Procurement Fraud Unit. Assistant United States Attorneys John Klassen and Gregory McDonald prosecuted this case on behalf of the Government.
Burlington, WV sex offender convicted of failure to update registrationRead the Press Release
MARTINSBURG, WEST VIRGINIA – Donald W. Patterson, 41, of Burlington, West Virginia, was convicted in federal court today of failing to update his sex offender registration when he moved from West Virginia to Maryland, United States Attorney William J. Ihlenfeld, II, announced.In 1993, Patterson was convicted of “Statutory Rape” in Tennessee. As a result of that conviction, Patterson is required to register as a sex offender. An investigation by the United States Marshals Service and the West Virginia State Police revealed that in the fall of 2013, Patterson moved across state lines to Maryland without updating his sex offender registration status.
He pled guilty today to one count of “Failure to Register and Update Registration as a Sex Offender – SORNA.” He faces up to 10 years in prison and a fine of up to $250,000.00. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Stephen Vogrin is prosecuting the case on behalf of the government.
U.S. Magistrate Judge Robert W. Trumble presided.
Burlington County, New Jersey, Man Sentenced to Nine Years in Prison for Downloading Images of Child Sexual AbuseRead the Press Release
CAMDEN, N.J. – A Palmyra, New Jersey, man was sentenced today to 108 months in prison for using a computer in his home to distribute images of child sexual abuse, U.S. Attorney Paul J. Fishman announced.
Donald Kivel, 38, previously pleaded guilty before U.S. District Judge Joseph H. Rodriguez to an information charging him with one count of receiving child pornography. Judge Rodriguez imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
Kivel admitted downloading images of child pornography that were available for distribution using peer-to-peer sharing software using a computer in his residence in June and July 2011. He also admitted to possessing more than 600 images of child pornography on his computer, which was seized from his residence July 15, 2011. Kivel acknowledged that among the images he possessed and distributed were images which depicted minors posing in a sexually explicit manner, images of child pornography involving children under the age of 12, and images that portrayed sadistic and/or masochistic conduct or other images of violence.
In addition to the prison term, Judge Rodriguez sentenced Kivel to serve 10 years of supervised release and ordered him to pay restitution of $19,980.
U.S. Attorney Fishman credited special agents of the FBI’s Newark Division, under the direction of Special Agent in Charge Aaron T. Ford, with the investigation leading to today’s sentencing.The government is represented by Attorney in Charge R. Stephen Stigall of the U.S. Attorney’s Office Criminal Division in Camden.
15-035
Defense counsel: Maggie Moy Esq., Assistant Federal Public Defender, Camden
Brothers Plead Guilty to Conspiracy to Distribute over $6.6 Million in Contraband CigarettesRead the Press Release
Baltimore, Maryland - Elmar Rakhamimov, a/k/a “Eric Rakhamimov,” age 42, of Owings Mills, Maryland, and his brother, Salim Yusufov, age 43, of Reisterstown, Maryland, pleaded guilty today to a conspiracy to traffic over $6.6 million in contraband cigarettes. Rakhamimov also pleaded guilty to trafficking in contraband cigarettes and distribution of oxycodone. Yusufov also pleaded guilty to health care fraud and to receipt and delivery of misbranded drugs.
The guilty pleas were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Chief James W. Johnson of the Baltimore County Police Department; Special Agent in Charge Antoinette V. Henry of the U.S. Food & Drug Administration, Office of Criminal Investigations; and Special Agent in Charge Nicholas DiGiulio, Office of Investigations, Office of Inspector General of the Department of Health and Human Services.
According to their guilty pleas, Elmar Rakhamimov, and his brother, Salim Yusufov, conspired with other family members and associates to receive, possess, sell and distribute contraband cigarettes, that is, cigarettes on which the applicable state taxes have not been paid. Rakhamimov, who was the leader and organizer of the scheme, purchased contraband cigarettes on 18 occasions between December of 2011 and November of 2013 from an undercover FBI agent operating in the Baltimore County, Maryland area. Salim Yusufov, who owned Health Way Pharmacy, received more than $81,000 in kickbacks for brokering the contraband cigarette transactions with the undercover FBI agent. These transactions included thousands of cartons of contraband cigarettes. The cigarettes were sold and distributed in quantities of 10,000 cigarettes or more, and bore no evidence of the payment of applicable state sales taxes. At the time of the indictment the cigarette tax in Maryland was $2.00 per package of cigarettes ($20 per carton of cigarettes) and the cigarette tax in New York was $4.35 per package of cigarettes ($43.50 per carton of cigarettes). The total tax evaded was more than $1 million.
As part of the criminal scheme, Rakhamimov also distributed pills containing oxycodone, with a total weight of 96.45 grams. The oxycodone and other drugs were distributed to the undercover FBI agent as partial payment for contraband cigarettes and in exchange for cash. During the drug transactions, Rakhamimov received $356,123 in cash in exchange for the various drugs.
According to his plea agreement, Rakhamimov and a co-conspirator laundered the proceeds of the contraband cigarette sales through an international money laundering operation that wired funds from banks located in Latvia, Cyprus, and Estonia, to a bank in New York, disguising the money as legitimate business payments for medical equipment or supplies. From December 27, 2012 through September 5, 2013, Rakhamimov and his co-conspirator wired a total of $681,450 through 12 such transactions. Rakhamimov and his co-conspirator received a fee of approximately 8% for the money laundering transactions.
Rakhamimov used his residence and his restaurant, Europe, to conduct the illegal transactions of contraband cigarettes and drugs, and the money laundering.
According to his plea agreement, Adam Azerman transported contraband cigarettes from Maryland to Brooklyn, using a van registered in his name. Azerman picked up the cigarettes from Rakhamimov’s residence and other locations, then drove his van to Brooklyn, New York, where he met Shamil Novakhov and provided him with the keys to the van. Novakhov admitted that he would take the van and return a few hours later, after he unloaded the contraband cigarettes into a nearby warehouse. Novakhov’s nephew, Ruslan Ykiew, admitted that he would also travel from New York to Maryland to obtain contraband cigarettes and transport them to his uncle in New York. Ykiew initially stored the cigarettes in a restaurant he owned. At Novakhov’s request, in 2012 Ykiew rented a warehouse for the storage of the contraband cigarettes.
Salim Yusufov also admitted that he illegally provided unapproved prescription drugs from Germany and Eastern Europe and sold them to customers. Corvalol, also referred to Corvalolum, and Valocordin, is not approved by the FDA for distribution in the United States, although it is sold in Eastern European countries, where it is used to treat elevated blood pressure and as a tranquilizer and sedative. Valocordin and Corvalol contain large amounts of phenobarbital, a prescription drug regulated by the FDA. According to his plea agreement, from July 23, 2010 through July 14, 2011, Yusufov , who is not a licensed pharmacist, imported and distributed Valocordin, dispensing the drug without a prescription.
In addition, Yusufov admitted to defrauding Medicare and Medicaid by causing Health Way Pharmacy to bill for prescriptions and/or prescription refills that the pharmacy did not provide to customers. One of the ways Yusafov did this was by intentionally failing to reverse claims for payment submitted to Medicare when customers did not pick up or otherwise receive refills. A second way that Yusufov defrauded Medicare and Medicaid was by providing drugs other than those prescribed, while still invoicing Medicare or Medicaid for the prescribed medication.
Rakhamimov and Yusufov face a maximum sentence of five years in prison for conspiracy to traffic in contraband cigarettes. Elmar Rakhamimov also faces a maximum of 20 years in prison for distribution of oxycodone, and five years in prison for trafficking in contraband cigarettes. Salim Yusufov also faces a maximum of 10 years in prison for health care fraud, and one year in prison for receipt and delivery of misbranded drugs. U.S. District Judge William D. Quarles, Jr. has scheduled sentencing for Rakhamimov and Yusufov for April 28 and April 30, 2015, respectively, each at 1:00 p.m.
Adam Azerman, age 59, of Pikesville, Maryland, and Shamil Novakhov, age 58, and Ruslan Ykiew, age 39, both of Brooklyn, New York, previously pleaded guilty today to conspiracy to traffic in contraband cigarettes and are awaiting sentencing.
United States Attorney Rod J. Rosenstein praised the FBI, Baltimore County Police Department, U.S. Food & Drug Administration, Office of Criminal Investigations and Office of Inspector General of the Department of Health and Human Services – Office of Investigations for their work in the investigation and the Medicaid Fraud Control Unit of the Maryland Attorney General’s Office for its assistance in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys Paul E. Budlow and John W. Sippel, Jr., who are prosecuting the case.
Beckley area man pleads guilty to oxycodone distributionRead the Press Release
BECKLEY, W.Va. – United States Attorney Booth Goodwin announced today that Boyd Wendell Clark, 31, of Daniels, West Virginia, pleaded guilty in federal court to distribution of oxycodone.
Clark admitted that on Oct. 1, 2014, he sold oxycodone to a confidential informant at Pine Grove Circle in Daniels.
Clark faces up to 20 years in federal prison, and a $1 million fine. He is scheduled to be sentenced May 13, 2015.
United States District Judge Irene C. Berger presided over the hearing.
The case is being investigated by the Beckley/Raleigh County Drug and Violent Crime Unit.
This case is being prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and opiates. The United States Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
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Bay Area CEO and Company Indicted for Import Wire Fraud SchemeRead the Press Release
OAKLAND – A federal grand jury in Oakland has indicted David Tung and Concord Farms, Inc. for conspiracy to commit wire fraud and wire fraud, announced United States Attorney Melinda Haag and U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Acting Special Agent in Charge Tatum King.
According to the indictment, Tung, then of Hillsborough, CA, through his operation of Concord Farms as the Chief Executive Officer, is alleged to have engaged in a scheme to defraud the United States out of duties owed on imported items, namely produce items such as gourmet mushrooms. Concord Farms claimed to be one of the largest importers and growers of gourmet mushrooms in the United States, with multiple business locations including operations in California and New York.
Duties are taxes assessed on the value of imported items. The duties accrue when the items arrive at a United States port of entry. According to the indictment, Tung carried out his scheme by creating fraudulent invoices that undervalued Concord Farms’ imports and then caused those fraudulent invoices to be transmitted to the U.S. Customs and Border Protection (CBP), who relied on the invoices in assessing the amount of import duties owed by the defendants. Tung and others used computer file templates and photocopy machines to create some of the fraudulent undervalued invoices that were transmitted to CBP. Through the scheme, Tung and Concord Farms were able to avoid the full payment of duties actually owed on the imported items.
Tung made his initial appearance today in Oakland. Tung was released on a bond in the amount of $250,000. Tung’s next scheduled appearance is at 9:30 a.m. on March 6, 2015 before the Honorable Jon S. Tigar, U.S. District Court Judge.
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, the Tung faces a maximum sentence of 20 years in prison, and a fine of $250,000, plus restitution for the alleged violation of 18 U.S.C. § 1349 (conspiracy to commit wire fraud) and for each alleged violation of 18 U.S.C. § 1343 (wire fraud). Concord Farms faces a fine of $500,000 and five years of probation for each alleged violation. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Wade M. Rhyne is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Janice Pagsanjan and Noble Hughes. The prosecution is the result of an investigation by the Department of Homeland Security, Homeland Security Investigations.
Baltimore Bank Robber Exiled to over 9 Years in PrisonRead the Press Release
Baltimore, Maryland – U.S. District Judge Ellen L. Hollander, sentenced Tony Derrell Bunch, age 32, of Baltimore, today to 110 months in prison followed by three years of supervised release for bank robbery.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Commissioner Anthony W. Batts of the Baltimore Police Department; Anne Arundel County Police Chief Tim Altomare; Chief Gary Gardner of the Howard County Police Department; and Baltimore City State’s Attorney Marilyn J. Mosby.
According to Bunch’s plea agreement, between late March and mid-April 2014, Bunch engaged in a string of bank robberies in the Baltimore area. In each robbery, Bunch presented the teller with a note stating that he had a gun and threatening to shoot if the teller did not comply with his demands for money.
Specifically, Bunch admitted that he robbed: the Wells Fargo Bank in the 6300 Block of York Road in Baltimore, on March 25, 2014, stealing $4,029.01; the Bay Bank in the 2600 block of Annapolis Road in Hanover, Maryland, on April 4, 2014, stealing $2,000; and the Wells Fargo Bank in the 4800 block of Eastern Avenue in Baltimore, on April 14, 2014, stealing $3,333.
After the robbery on April 4, 2014, Bunch left the demand note at the bank and forensic examiners were able to obtain a fingerprint. The forensic examiners were able to match the print obtained from the note with a known print of Bunch.
United States Attorney Rod J. Rosenstein commended the FBI, Baltimore Police Department, Anne Arundel County Police Department; Howard County Police Department and Baltimore City State’s Attorney’s Office for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorney P. Michael Cunningham, who prosecuted the case.
Armed Home Invader/Carjacker Sentenced to 15 Years in Federal PrisonRead the Press Release
DALLAS — A Dallas man who admitted to his role in an armed home invasion and carjacking conspiracy was sentenced today, announced John Parker, Acting U.S. Attorney for the Northern District of Texas.
Michael Wafer, 26, was sentenced this afternoon by U.S. District Judge Jane J. Boyle to serve a total of 15 years in federal prison. Wafer pleaded guilty in May 2013 to an indictment charging one count each of conspiracy to commit carjacking; using, carrying, and brandishing a firearm during and in relation to a crime of violence; and carjacking.
Wafer’s four co-conspirators, Blake Robertson, 22; Jeremiah Walker, 22; Christopher Staton, 20; and Ladavid Sims, 20; have each pleaded guilty to the same offenses as Wafer and are scheduled to be sentenced by Judge Boyle within the next few months. Statutorily, the conspiracy count carries a maximum penalty of five years in federal prison; the firearm offense carries a penalty of not less than seven and up to life in federal prison; and the carjacking offense carries a maximum penalty of 15 years in federal prison. Each count also carries a maximum statutory fine of $250,000.
On December 30, 2013, the five defendants discussed, planned, and agreed to rob an individual, “M.J.,” who was an acquaintance of Walker’s, at M.J.’s house in Dallas, and then steal his vehicle. Officers with the Dallas Police Department identified these five defendants as suspects in the armed home invasion and carjacking of M.J. during the early morning hours of December 31, 2013. Just prior to that, they had attempted another armed robbery in North Dallas, during which the victim was shot.
When the five conspirators entered M.J’s house, they were carrying firearms and were willing to inflict serious injury upon M.J. if he failed to comply with their demands. The conspirators demanded money and jewelry from M.J., at gunpoint, and M.J. was struck in the head several times with a weapon. The conspirators also took the keys to M.J.’s vehicle and all five conspirators fled in that vehicle.
The Dallas Police Department and the FBI investigated. Assistant U.S. Attorney Lisa J. Miller is prosecuting.
Allentown Man Sentenced to 10 Years for Drug Trafficking SchemeRead the Press Release
ALLENTOWN – Melvin Aviles, 34, of Allentown, PA, was sentenced today to 10 years in prison for running a cocaine trafficking operation. Aviles pleaded guilty on April 8, 2014 to conspiracy to distribute 500 grams or more of cocaine, four counts of distributing and aiding and abetting the distribution of cocaine, one count of distributing and aiding and abetting the distribution of cocaine within 1,000 feet of a public school, five counts of distribution of cocaine, and one count of attempted possession with intent to distribute.
Between October 2012 and April 2013, Aviles operated a cocaine trafficking business, obtaining cocaine from sources in Puerto Rico and other locations for resale in the Allentown area. Aviles arranged to have parcels shipped via the United States Postal Service from Puerto Rico to various addresses in Allentown. Once the cocaine was delivered, Aviles would transport the cocaine to his Allentown residence, weigh it, and repackage it for further distribution in and around the Allentown area. Some of the cocaine sales were conducted within 1,000 feet of schools.
In addition to the prison term, U.S. District Court Judge James Knoll Gardner ordered 12 years of supervised release and a $1,100 special assessment.
“The successful result of this prosecution is due, in large part, to the outstanding collaboration of local, state, and federal law enforcement,” said Memeger. “The tireless efforts and diligent work of the officers and agents investigating this case, made it possible to get this drug trafficker off the streets of Allentown.”
“This case represents just the most recent success derived from the close working relationship that exists between the Pennsylvania State Police and our federal and local law enforcement partners,” said Pennsylvania State Police Captain Brian Tobin. “We will continue to put forth our combined resources in order to protect the citizens of this Commonwealth and ensure those who choose to commit crimes are brought to justice.”
The case was investigated by the Federal Bureau of Investigation, the Pennsylvania State Police, and the Allentown Police Department with assistance by the Office of the Lehigh County District Attorney. It was prosecuted by Assistant United States Attorney Sherri A. Stephan.
Air Force Contractor Pays $380,000 to Settle Allegations of False ClaimsRead the Press Release
Oklahoma City, Oklahoma -- Sanford C. Coats, United States Attorney for the Western District of Oklahoma, announces that Computer Sciences Corporation (“CSC”), a government contractor, has agreed to pay $380,000 to settle civil claims stemming from allegations that it violated the False Claims Act by submitting false claims to the United States Air Force.
CSC contracted with the Air Force to provide aircraft maintenance services at Vance Air Force Base, Oklahoma. As part of the contract, CSC agreed to perform maintenance on hydraulic actuators in Air Force aircraft. Hydraulic actuators power various systems and functions in the aircraft such as the landing gear, vertical/horizontal stabilizers and flaps.
The United States contends that CSC submitted false claims for payment to the Air Force during the period from February 1, 2008 through January 31, 2013. More specifically, the false claims for payment were for painting, non-destructive inspections and pressure tests of hydraulic actuators in T-38 aircraft that were not performed. In order to resolve the allegations brought by the United States, CSC agreed to pay $380,000.
In reaching this settlement, CSC did not admit liability and the government did not make any concessions regarding the legitimacy of the claims. The agreement allows the parties to avoid the delay, expense, inconvenience, and uncertainty involved in litigating the case.
This case was investigated by the Air Force Office of Special Investigations. The case was prosecuted by Assistant United States Attorney Ronald R. Gallegos.
Acoma Pueblo Man Sentenced to Prison for Federal Assault ConvictionRead the Press Release
ALBUQUERQUE – Robert Lucero, 45, a member and resident of Acoma Pueblo, N.M., was sentenced this morning in federal court in Santa Fe, N.M., to 24 months in federal prison followed by two years of supervised release for his assault conviction.
Lucero was arrested on May 21, 2014, on a criminal complaint charging him with assault with a dangerous weapon and assault resulting in serious bodily injury. Lucero subsequently was charged in a two-count indictment with assault with a dangerous weapon and assault resulting in serious bodily injury. According to court filings, Lucero assaulted the victim, also an Acoma Pueblo man, with a wooden bat or stick on May 1, 2014 within the boundaries of the Pueblo of Acoma Reservation.
On Sept. 29, 2014, Lucero entered a guilty plea to Count 2 of the indictment, and admitted assaulting the victim with a wooden axe handle on May 1, 2014. Court filings reflect that the victim sustained several lacerations to the head that required medical stapling and stitching.
This case was investigated by the Albuquerque office of the FBI and Acoma Pueblo Tribal Police Department and was prosecuted by Assistant U.S. Attorney Novaline D. Wilson.
Wednesday 28 January 2015
Woman Charged in A Multi-state Bank Fraud and Identity Theft SchemeRead the Press Release
The United States Attorney for the Middle District of Pennsylvania announced today that an indictment was returned by a grand jury charging a New York woman with bank fraud and aggravated identity theft.
Njeri Bowen, age 26, a resident of New York, defrauded a PNC Bank in State College and more than 25 PNC Bank customers of approximately $138,000.
According to United States Attorney Peter Smith, Bowen and her co-conspirators operated out of New York City and as part of the scheme, Bowen obtained PNC Bank customer names and account numbers. Bowen traveled to PNC Bank branches located in several states, including Pennsylvania, Ohio, Kentucky, North Carolina, Georgia, West Virginia, and Alabama, where she impersonated bank account holders and made cash withdrawals from the customers' accounts. In each fraudulent withdrawal, Bowen withdrew between $4,500.00 to $6,500.00 in cash.
The investigation was conducted by the Federal Bureau of Investigation, the Pennsylvania State Police, and the Maryland State Police. The case is being prosecuted by Assistant U.S. Attorney Joseph J. Terz.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court. A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
In this case, the maximum penalty under the federal bank fraud statute is 30 years' imprisonment, a term of supervised release following imprisonment, and a fine. The maximum penalty under the federal aggravated identity theft statute is a mandatory two-year term of imprisonment. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
Waxahachie Man Sentenced to Federal Prison for Illegally Disbursing Funds in Bankruptcy CaseRead the Press Release
DALLAS — A Waxahachie, Texas, man, James Derek Howard, was sentenced today by U.S. District Judge Ed Kinkeade to serve one year and one day in federal prison, following his guilty plea last year to a bankruptcy fraud offense. In addition, Judge Kinkeade ordered that Howard pay $13,283 in restitution to Southwest Securities, FSB. The announcement was made today by John Parker, Acting U.S. Attorney for the Northern District of Texas.
Howard, 39, pleaded guilty on October 14, 2014, to one count of fraudulent transfer of property of the bankruptcy estate. He has been in federal custody since October 1, 2014, when a U.S. Magistrate Judge revoked his pretrial release based on a government motion to revoke his bond.
According to documents filed in the case, Howard filed a Chapter 11 bankruptcy petition for Waxahachie Heritage Partners, LLC in October 2011. Waxahachie was the named corporate debtor listed in the bankruptcy petition, and Howard signed the petition in his capacity as a member of Waxahachie Heritage Partners, LLC.
Howard was on the signature card of the Debtor in Possession (DIP) account and had access to all the funds in the account. Pursuant to Court order, Howard could only disburse funds from the DIP account with the Court’s prior authorization. From March 2011 through March 2012, the Bankruptcy Court conducted several hearings and issued several orders in an attempt to compel Howard to provide a full accounting to the Court for all funds in the DIP account. Howard admitted that in January 2012, without Court authorization, he knowingly fraudulently transferred $10,000 from the DIP account by writing a $10,000 check to himself.
This case is one of several felony prosecutions of bankruptcy-related crimes generated by the recent Bankruptcy Fraud Initiative within the Northern District of Texas. From May 2013 to the present, nine debtors have been charged with various felony offenses. To date, five of these defendants have entered guilty pleas and have been sentenced, three defendants are set for trial and one charged defendant remains in fugitive status with an outstanding arrest warrant.
The U.S. Postal Inspection Service investigated. Assistant U.S. Attorney David Jarvis prosecuted.
Walsenburg Police Officer Sentence to Federal Prison for Aiding and Abetting the Possession with Intent to Distribute HeroinRead the Press Release
DENVER – Gloria Evangeline Suazo, age 32, of Pueblo, was sentenced last week by U.S. District Court Judge Raymond P. Moore to serve 60 months (5 years) in federal prison for aiding and abetting the possession with intent to distribute a controlled substance, namely heroin, U.S. Attorney John Walsh and ATF Denver Division Special Agent in Charge Luke Franey announced. Following her prison term, Suazo, a Walsenburg Police Officer at the time of her crime, was ordered to serve 3 years on supervised release. As a convicted felon, she will never be legally allowed to possess a firearm or ammunition. Suazo’s ex-husband, Jeromy Ray Suazo, age 33, also of Pueblo, was a codefendant in the case. He pled guilty to being a felon in possession of a firearm and for conspiracy to distribute and possession of a controlled substance with intent to distribute, and was sentenced by Judge Moore to 120 months (10 years) in federal prison followed by 3 years of supervised release.
Gloria and Jeromy Suazo were indicted by a federal grand jury on June 3, 2014. Jeromy Suazo pled guilty on September 23, 2014 and was sentenced on December 16, 2014. Gloria Suazo pled guilty on October 29, 2014 and was sentenced on January 23, 2015.
According to court documents, Jeromy Suazo was contacted while leaving a Pueblo area bar. During that contact law enforcement noticed a Glock firearm. As the defendant was a felon he was taken into custody for being a felon in possession of a firearm. After his arrest, he called Gloria Suazo, his ex-wife, who happened to be a Walsenburg Police Officer, from the Pueblo County Jail, asking her to retrieve a large amount of cash and heroin which he had hidden in his apartment. Suazo went to the apartment, and while there Jeromy called again and described the exact location and appearance of the heroin so she could recover it along with the cash. Law enforcement officers, who were monitoring the jail house call, arrived at Jeromy’s apartment too late to catch Gloria Suazo in the act. They later obtained consent to search Gloria Suazo’s home, and located and seized the cash and heroin. She was arrested soon after.
While out on bond on the federal indictment, and the day after she pled guilty in the federal case, Gloria was arrested in Pueblo for distributing cocaine. Her children were with her at the time she was selling the cocaine and when she was arrested. That case is pending in state court.
“When a government official abuses his or her position to provide cover for illegal conduct, we will hold that official responsible,” said U.S. Attorney John Walsh. “In this case a sworn law enforcement officer chose to help her ex-husband instead of following her legal law enforcement obligations, and for that she will now be incarcerated.”
“ATF and our partners from the Pueblo Police Department will continue to target those who possess firearms while distributing narcotics as well as anyone who assists them in the criminal activity,” said Denver ATF Special Agent in Charge Luke Franey. “This includes those who hold a position of trust with the public.”
This case was investigate by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the Pueblo Police Department.
The matter was prosecuted by Assistant U.S. Attorney Kurt Bohn.
WV man sentenced to two years for heroin traffickingRead the Press Release
MARTINSBURG, WEST VIRGINIA – Tony Calvin Collins, 20, of Maysville, West Virginia, was sentenced today to 24 months in prison for heroin trafficking, United States Attorney William J. Ihlenfeld, II, announced.
Collins was discovered in possession of heroin in January 2014 in Moorefield, West Virginia during an Eastern Panhandle Drug and Violent Crime Task Force investigation. The Task Force is a HIDTA-funded initiative. Collins pled guilty in November 2014 to one count of “Aiding and Abetting Possession with Intent to Distribute Heroin.”
Assistant U.S. Attorney Jarod Douglas prosecuted the cases on behalf of the government.
U.S. District Judge Gina M. Groh presided.
Virginia Man Faces Child Pornography ChargesRead the Press Release
A grand jury returned a three-count indictment charging David W. Vickers, 41, of Leesburg, Virginia, with receiving and distributing visual depictions of minors engaged in sexually explicit conduct, enticement, and travel with intent to engage in illicit sexual conduct, Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
If convicted, the defendant’s sentence will be determined by the Court after a review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The case is being prosecuted by Assistant U.S. Attorney Brian M. McDonough following an investigation by the Ohio Internet Crimes Against Children Task Force and the United States Secret Service.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.
Two Mexican Nationals Get Significant Sentences for Illegal Re-EntryRead the Press Release
LAREDO, Texas – Carlos Aragon-Carrillo, 30, and Juan Garcia-Rodriguez, 49, both of Mexico, have been handed lengthy sentences following their convictions of illegal re-entry after deportation or removal in separate cases, announced United States Attorney Kenneth Magidson. Aragon-Carrillo and Garcia-Rodriguez both entered guilty pleas May 13, 2014.
Today, U.S. District Judge Janis Graham Jack sentenced Aragon-Carrillo to 77 months in federal prison. In handing down the sentence, the court noted Aragon-Carrillo’s extensive criminal history. As he was on supervised release for another illegal re-entry conviction when committing this offense, the court also revoked that term and ordered he serve an additional 21 months to be served consecutively for a total of 98 month of imprisonment.
Judge Jack also sentenced Garcia-Rodriguez today, ordering him to serve 120 months in federal prison.
Following completion of their prison terms, both will once again be expected to face deportation proceedings.
On March 8, 2014, U.S. Border Patrol (BP) agents discovered Aragon-Carrillo in Laredo and soon determined he was a Mexican national and illegally present in the United States. Aragon-Carrillo has a long and extensive criminal history including four separate felony convictions involving firearm and fleeing from law enforcement. He had been deported to Mexico in 2011 following his release from prison for the prior illegal re-entry conviction.
In a separate, but similar case, Garcia-Rodriguez was arrested by BP after being found in Laredo on Feb. 16, 2014. Agents learned he had prior felony convictions for second degree murder, assault and assault on a peace officer and had been deported just five days prior to being found by law enforcement in the U.S.
HSI and BP investigated the cases. Assistant U.S. Attorney (AUSA) Sonah Lee prosecuted the case against Aragon-Carrillo, while AUSA Christopher A. dos Santos handed the case against Garcia-Rodriguez.
Two Checotah Men Plead Guilty to Methamphetamine DistributionRead the Press Release
Muskogee, Oklahoma - The United States Attorney’s Office for the Eastern District of Oklahoma, announced the guilty pleas of MICHAEL A. METZKER and MICHAEL W. METZKER. The two pled guilty to Conspiracy To Possess With Intent To Distribute And Distribute Five Hundred (500) Grams Or More Of Methamphetamine, in violation of Title 21, United States Code, Sections 846, 8411(a)(1) and 841(b)(1)(A).
MICHAEL A. METZKER, a/k/a Lurch, age 36, of Checotah, Oklahoma was indicted in June 2014, along with MICHAEL W. METZKER, a/k/a Chic, age 59, of Checotah, Oklahoma, LACEY RENEE PARK, age 29, of Checotah, Oklahoma, DEREK PARK, age 31, of Checotah, Oklahoma, MARGARET CASEY, age 45, of Checotah, Oklahoma, SHAWNA VANZANT, age 33, of Henryetta, Oklahoma, JACKIE DALE BRUMLEY, age 44, of Noble, Oklahoma, CORNELL TYLEIZ HARVEY, age 29, of Oklahoma City, Oklahoma, SCOTT WESLEY DUNCAN, age 38, of Oklahoma City, Oklahoma, SUNNY ANN MARTINEK, age 38, of Norman, Oklahoma and STEVEN D. CARR, age 43, formerly of Checotah, Oklahoma. All have previously pled guilty and are awaiting sentencing.
The Indictment alleged that from in or about April 2003 to on or about April 15, 2014, within the Eastern District of Oklahoma and elsewhere, the defendants, knowingly conspired to possess with the intent to distribute and to distribute 500 grams or more of a mixture or substance containing a detectable amount of Methamphetamine, a Schedule II Controlled Substance.
Michael A. Metzker, a member of the Universal Aryan Brotherhood (UAB), was incarcerated in the Oklahoma Department of Corrections from December 24, 2009, until January 8, 2014. Beginning in or before April 2013, up to an including January 8, 2014, Michael A. Metzker utilized cellular telephones, illegally smuggled into the prison, to coordinate the acquisition and distribution of methamphetamine in Eastern Oklahoma. Upon release from incarceration up to and including April 14, 2014, Michael A. Metzker and his co-conspirators continued to acquire and distribute methamphetamine within Eastern Oklahoma.
The charges arose from a joint investigation by the Drug Enforcement Administration, Bureau of Indian Affairs, McAlester Police Department, the Muskogee Police Department, the Checotah Police Department, the Eufaula Police Department, the Stigler Police Department, Districts 18, 23, and 25 District Attorney’s Drug Task Force, the Oklahoma Highway Patrol, the Okmulgee County Sheriff’s Office, the McIntosh County Sheriff’s Office, the Pittsburg County Sheriff’s Office, the Oklahoma Department of Corrections, United States Department of Homeland Security, and the United States Marshal Service. The investigation was coordinated by the Organized Crime Drug Enforcement Task Force (OCDETF) of the Eastern District of Oklahoma. OCDETF is an initiative led, and coordinated by, the Office of the United States Attorney.
The Honorable Steven P. Shreder, Magistrate Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, accepted the guilty pleas and ordered the completion of presentence reports. Sentencings will be scheduled following their completions. The defendants will remain in the custody of the United States Marshal Service pending sentencing.
The statutory range of punishment is not less than 10 years imprisonment and/or up to a $10,000,000.00 fine.
Assistant United States Attorney Shannon Henson represented the United States.
Traverse City Man Pleads Guilty to Willfully Failing to Timely File Income Tax ReturnRead the Press Release
GRAND RAPIDS, MICHIGAN – Scott Edward Carroll, 49, of Traverse City, Michigan, pled guilty on January 28, 2015, in United States District Court for the Western District of Michigan to a misdemeanor information filed on January 13, charging him with willfully failing to timely file an income tax return for the 2008 tax year, U.S. Attorney Patrick Miles announced today. Carroll will be sentenced on May 19, 2015, at which time he will face up to one year of imprisonment and a fine of up to $100,000.00. As part of his plea agreement, Carroll has agreed to pay restitution of $103,466.65, plus fraud penalties totaling an additional $44,241.00.
“In 2006 and 2007, Carroll underreported the gross sales from his business by over $180,000.00 on his federal tax returns, and then willfully failed to file tax returns in 2008, 2009 and 2010. This office will continue to vigorously prosecute those who willfully choose to cheat the tax system to avoid paying the same fair share of the tax burden dutifully paid by the taxpayers of this district,” said U.S. Attorney Miles.
From 2006 through 2010, Carroll operated a training and consulting business in Traverse City, Michigan. In 2006 and 2007, he substantially underreported his gross sales from that business on Schedule C of his federal tax returns, resulting in an underreporting of his tax liability in each year. Despite the fact that the Internal Revenue Service began an audit of his tax returns, Carroll willfully failed to timely file any personal tax returns for tax years 2008, 2009, and 2010, by the required deadlines. Instead, he did not file his income tax returns and pay his taxes for those years until 2012, long after the Internal Revenue Service informed him that it had commenced a criminal investigation of his conduct. As part of his guilty plea to the misdemeanor information for willfully failing to timely file his tax return for 2008, Carroll has
also agreed to pay his corrected tax liabilities ($65,666.00), along with fraud penalties ($44,241.00) and interest ($37,800.65), associated with tax years 2006 and 2007."IRS Criminal Investigation directs its efforts at the portion of taxpayers that willfully violate their known legal duty to timely file accurate income tax returns,” said Jarod J. Koopman, Special Agent in Charge, Internal Revenue Service Criminal Investigation. “Identifying and investigating these types of crimes is vital to maintaining public confidence in our tax system.”
The Internal Revenue Service-Criminal Investigation conducted the investigation, and Assistant United States Attorney Ronald M. Stella is the prosecutor.
Traverse City Man Pleads Guilty to Willfully Failing to Timely File Income Tax ReturnRead the Press Release
GRAND RAPIDS, MICHIGAN – Scott Edward Carroll, 49, of Traverse City, Michigan, pled guilty on January 28, 2015, in United States District Court for the Western District of Michigan to a misdemeanor information filed on January 13, charging him with willfully failing to timely file an income tax return for the 2008 tax year, U.S. Attorney Patrick Miles announced today. Carroll will be sentenced on May 19, 2015, at which time he will face up to one year of imprisonment and a fine of up to $100,000.00. As part of his plea agreement, Carroll has agreed to pay restitution of $103,466.65, plus fraud penalties totaling an additional $44,241.00.
“In 2006 and 2007, Carroll underreported the gross sales from his business by over $180,000.00 on his federal tax returns, and then willfully failed to file tax returns in 2008, 2009 and 2010. This office will continue to vigorously prosecute those who willfully choose to cheat the tax system to avoid paying the same fair share of the tax burden dutifully paid by the taxpayers of this district,” said U.S. Attorney Miles.
From 2006 through 2010, Carroll operated a training and consulting business in Traverse City, Michigan. In 2006 and 2007, he substantially underreported his gross sales from that business on Schedule C of his federal tax returns, resulting in an underreporting of his tax liability in each year. Despite the fact that the Internal Revenue Service began an audit of his tax returns, Carroll willfully failed to timely file any personal tax returns for tax years 2008, 2009, and 2010, by the required deadlines. Instead, he did not file his income tax returns and pay his taxes for those years until 2012, long after the Internal Revenue Service informed him that it had commenced a criminal investigation of his conduct. As part of his guilty plea to the misdemeanor information for willfully failing to timely file his tax return for 2008, Carroll has
also agreed to pay his corrected tax liabilities ($65,666.00), along with fraud penalties ($44,241.00) and interest ($37,800.65), associated with tax years 2006 and 2007."IRS Criminal Investigation directs its efforts at the portion of taxpayers that willfully violate their known legal duty to timely file accurate income tax returns,” said Jarod J. Koopman, Special Agent in Charge, Internal Revenue Service Criminal Investigation. “Identifying and investigating these types of crimes is vital to maintaining public confidence in our tax system.”
The Internal Revenue Service-Criminal Investigation conducted the investigation, and Assistant United States Attorney Ronald M. Stella is the prosecutor.
Three Defendants Sentenced to over 32 Years in Prison for Drug TraffickingRead the Press Release
Fayetteville, Arkansas - Conner Eldridge, United States Attorney for the Western District of Arkansas, announced that Leonel Padilla, Andres Diaz and Jonni Diaz were sentenced yesterday in Northwest Arkansas to a total of over 32 years in federal prison for drug trafficking offenses. Padilla, age 27, of Springdale, was sentenced to 87 months in prison followed by four years of supervised release for Distribution of Methamphetamine; Andres Diaz, age 49, of Barstow, California, was sentenced to 180 months in prison followed by three years of supervised release for Distribution of Methamphetamine; and Jonni Diaz, age 47, of Barstow, California, was sentenced to 120 months in prison followed by three years of supervised release for Aiding and Abetting the Distribution of Methamphetamine. The Honorable Timothy L. Brooks presided over the sentencing hearings in the United States District Court in Fayetteville.
United States Attorney Eldridge commented, “These sentences handed down represent significant prison time for those that brought methamphetamine onto our streets and into our communities. Drug trafficking and the violence it brings will not be tolerated in Northwest Arkansas, or anywhere across the Western District. We remain steadfast in our commitment to keeping our children and our communities safe from drugs and other illegal activities by assuring that those responsible for this type of criminal behavior will be brought to justice.”
“Methamphetamine brings turmoil into the lives of those who are addicted to or live around it,” stated David Downing, Assistant Special Agent in Charge of DEA’s Little Rock District Office. “The sentences imposed in this case should be a warning to anyone thinking of polluting our communities with this addictive substance. DEA, along with our law enforcement partners are committed to investigating illegal organizations that profit from the distribution of methamphetamine and other illegal and dangerous narcotics,” said Downing.
According to court records, investigators with the Drug Enforcement Administration (DEA) were conducting an ongoing narcotics investigation known as “West End Gambler” into an organization that was involved in distributing large quantities of methamphetamine in Northwest Arkansas when they determined Leonel Padilla to be a suspect. During the investigation, DEA agents arranged a controlled purchase of approximately one ounce of methamphetamine on August 9, 2013 in Siloam Springs, Arkansas from Padilla in exchange for $1,500.00. DEA agents recovered the methamphetamine and sent it to the DEA Crime Laboratory where testing confirmed the substance contained actual methamphetamine. Padilla entered a plea of guilty to one count of Distribution of Methamphetamine on April 7, 2014.
Agents from the Drug Enforcement Administration began another investigation in March of 2014 after learning that large quantities of methamphetamine were being distributed out of the Springdale, Arkansas area by an individual named Andres Diaz. DEA agents utilized a confidential informant to conduct a recorded conversation with Diaz on March 11, 2014, where Diaz agreed to meet with the informant’s friend who was looking to obtain large quantities of methamphetamine. As a result, a Task Force Officer with the DEA, acting in an undercover capacity, placed several phone calls and exchanged text messages with Diaz where Diaz agreed to meet with the undercover officer and provide him or her with an ounce of methamphetamine in exchange for $1,400.00. A few days later, agents with the DEA watched and listened as the undercover officer met with Diaz at a local business in Springdale, Arkansas where Diaz provided the undercover officer with approximately one ounce of methamphetamine in exchange for $1,400.00. Diaz then provided an additional two ounces of methamphetamine to the undercover officer with the agreement that the undercover officer would pay Diaz at a later date. The methamphetamine was sent to the DEA Crime Laboratory where it was determined that the substance sold did contain actual methamphetamine. Andres Diaz was arrested on April 18, 2014, and at that time agreed to provide a statement to officers regarding his drug trafficking activities. During the interview, Andres Diaz admitted to the distribution of methamphetamine in Springdale, Arkansas. Andres Diaz pleaded guilty to one charge of Distribution of Methamphetamine on September 22, 2014.
While investigating Andres Diaz, and as a result of the same recorded conversation that took place on March 11, 2014, a Task Force Officer with the DEA, acting in an undercover capacity, placed several phone calls and exchanged text messages with Andres Diaz. Through the text messages, Diaz agreed to meet with the undercover officer on March 26, 2014, and provide him or her with two ounces of methamphetamine in exchange for $2,400.00. On March 26, 2014, other agents with the DEA watched and listened as the undercover officer went to a local business in Springdale, Arkansas to meet with Andres Diaz. Once there, the officer noticed Diaz’s vehicle in the parking lot. Andres Diaz was driving the vehicle and Jonni Diaz was sitting in the front passenger seat. During the transaction, Andres Diaz placed two ounces of methamphetamine onto Jonni Diaz’s purse, which was sitting in her lap. Jonni Diaz then picked up the methamphetamine and handed it to the undercover officer. The undercover officer then paid Andres Diaz for the methamphetamine. The substance was sent to the DEA Crime Laboratory where it was determined the substance did contain actual methamphetamine. Jonni Diaz was arrested on April 18, 2014, and agreed to provide a statement regarding her drug trafficking activities. During the interview, Jonni Diaz then admitted to aiding and abetting in the distribution of methamphetamine. Jonni Diaz pleaded guilty to one charge of Aiding and Abetting the Distribution of Methamphetamine on July 31, 2014.
These cases were investigated by the Drug Enforcement Administration, the Benton County Sheriff’s Office, the Washington County Sheriff’s Office, the Springdale Police Department, and the Fayetteville Police Department. Assistant United States Attorney Clay Fowlkes prosecuted the cases for the United States.
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Related court documents may be found on the Public Access to Electronic Records website @ www.pacer.gov
Second Defendant Sentenced for Laundering over $400,000 in Currency from Purported Narcotics TransactionsRead the Press Release
A Miami Dade County resident was sentenced today to 51 months in prison, to be followed by one year of supervised release, for conspiring with another defendant to launder money from purported narcotics transactions.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), made the announcement.
On November 20, 2014, Pavel Sosa Medina, 46, of Miami, pled guilty to a one-count information charging him with conspiracy to commit an offense against the United States.
According to court documents, from January 2014 through August 2014, Sosa Medina conspired with defendant Amado Vazquez to launder money from purported narcotics transactions. In January 2014, Vazquez met with an IRS undercover agent (UCA). The UCA said he was in the business of laundering money for Mexican drug dealers from the sale of cocaine. The UCA advised Vazquez that he needed help moving $15,000 to $20,000 in cash a day, and Vazquez indicated that he could assist with the laundering of these proceeds.
On several occasions, according to court documents, from March 2014 through July 2014, the UCA provided Vazquez with over $400,000 in currency that represented purported narcotics transactions proceeds. Vazquez provided the UCA with checks to various shell companies or returned the money to the UCA via wires to the bank accounts of shell corporations.
Court documents further explain that on August 21, 2014, Vazquez admitted his involvement in the scheme and explained that he and Sosa Medina split a 15% fee for laundering this money. On that same day, Vazquez contacted Sosa Medina and advised in code that Vazquez had several hundred thousand dollars in cash. Sosa Medina arrived at Vazquez’s residence where he was arrested by law enforcement. ln Sosa Medina’s car, law enforcement found approximately twenty to thirty thousand dollars in cash and a large number of blank checks from a construction company.
On November 6, 2014, Vazquez pled guilty to the one-count information charging him with conspiracy to commit an offense against the United States. On January 14, 2015, Vazquez was sentenced to 34 months in prison, followed by one year of supervised release.
Mr. Ferrer commended the investigative efforts of the IRS-CI. This case was prosecuted by Assistant United States Attorney Michael N. Berger.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. 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.
Rogers Man Sentenced to 60 Months in Prison for Child Pornography OffenseRead the Press Release
Fayetteville - Conner Eldridge, United States Attorney for the Western District of Arkansas, announced that Craig Goettsch, 53, of Rogers, Arkansas was sentenced today to 60 months in prison followed by five years of supervised release for Possession of Child Pornography. The sentencing took place before the Honorable Timothy L. Brooks in the United States District Court in Fayetteville.
U. S. Attorney Eldridge commented, “Today’s sentence is a reminder that we will not rest in our efforts to identify, investigate, and prosecute those who commit crimes against our children. Every time a video or image involving sexual abuse of children is downloaded or viewed, those children are re-victimized. We appreciate the hard work of law enforcement to bring these sexual predators to justice.”
According to court records, in May 2013, members of the Northwest Arkansas Internet Crimes Against Children taskforce identified a computer that was engaging in the distribution of child pornography via an internet file sharing program. A subsequent investigation revealed that the subscriber information related to the suspect internet user account returned to a residence in Rogers, Arkansas, and a subscriber name of Craig Goettsch. In response, law enforcement obtained a search warrant for the Goettsch’s residence. The warrant was executed in January of 2014, at which time law enforcement seized numerous computers and other digital storage devices. Goettsch was later interviewed and admitted to using the internet to download and view child pornography. A subsequent forensic examination of the confiscated items revealed thousands of images of child pornography. On October 2, 2014, Goettsch pleaded guilty in Federal Court to possessing child pornography. At sentencing, the Government presented the Court with evidence that some of the minors depicted in the images were as young as 8 years old.
This case was investigated by Homeland Security Investigations and Internet Crimes Against Children Task Force. Assistant United States Attorney Dustin Roberts prosecuted the case for the United States.
The case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and their Criminal Division Child Exploitation and Obscenity Sections (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.
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Related court documents may be found on Public Access to Electronic Records Website @www.Pacer.gov
Rochester Man Pleads Guilty to Bank Fraud and Identity TheftRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
ROCHESTER, N.Y.—U.S. Attorney William J. Hochul, Jr. announced today that Michael Debardlabon, 32, of Rochester, NY, pleaded guilty conspiracy to commit bank fraud and aggravated identity theft, before U.S. District Judge Elizabeth A. Wolford. Conspiracy to commit bank fraud carries a maximum penalty of 30 years in prison and a $1,000,000 fine. Aggravated identity theft carries a mandatory term of two years in prison to be served consecutively to any penalty imposed for bank fraud conspiracy.Assistant U.S. Attorney Tiffany H. Lee, who is handling the case, stated that between November 2012 and September 2013, Debardlabon and a co-conspirator, using the name, social security numbers and dates of birth of two different Florida residents, obtained financing to purchase used automobiles (including an Infinity, a Lexus and a BMW) through financial institutions to include ESL and Ally Financial. The Florida residents never authorized the financial transactions to occur. In addition, on one occasion, the personal information of a third Florida resident was used to open an American Express card. Charges to the card included air fare for Debardlabon.
Charges are pending against co-conspirator Maria English. The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
The plea is the culmination of an investigation on the part of the United States Postal Inspection Service under the direction of Shelly Binkowski, Inspector in Charge, Boston Division and the Rochester Police Department, under the direction of Chief Michael Ciminelli.
Repeat Alien Trafficker Sentenced to Prison After Failed EscapeRead the Press Release
LAREDO, Texas – Daniel Mata, 28, of Rio Bravo, has been ordered to federal prison for transporting illegal aliens for profit, announced U.S. Attorney Kenneth Magidson. Mata pleaded guilty Feb. 28, 2014.
Today, U.S. Senior District Judge George Kazen ordered he serve a total of 60 months in federal prison to be immediately followed by three years of supervised release. At the hearing, the court noted his previous convictions for similar conduct and admonished Mata, stating that “you’ve packed a lot crime into a short amount of time…you’re not a career criminal, but a career and a half criminal!” Mata apologized to BP agents and their families.
On Feb. 28, 2014, U.S. Border Patrol (BP) agents learned of illegal aliens that had entered the United States via a resident’s backyard in Rio Bravo. Agents responded and noticed a suspicious Grand Marquis vehicle in the area and followed it to a local convenience store.
Mata was the driver of the vehicle. He then exited the car and entered the store. Agents continued surveillance of the vehicle and determined the four passengers were Mexican nationals that were illegally within the United States. The aliens admitted paying $5,000 as a transfer fee and identified Mata as their driver.
Agents entered the store in search of Mata. Inside, Mata engaged in a physical confrontation with law enforcement and fled the scene. He ran outside of the store and was pursued by BP agents on foot and through air surveillance by the National Guard Air Unit. After an exhaustive pursuit, he was eventually apprehended.
He will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The charges were the result of an investigation by BP, the National Guard Air Unit, Homeland Security Investigations and the FBI. Assistant U.S. Attorney Sanjeev Bhasker is prosecuting the case.
Reading Man Sentenced to 66 Months in Prison for Role in Monroe County-Based Drug ConspiracyRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a 30-year-old Reading, Pennsylvania man was sentenced to 66 months in prison yesterday by U.S. District Court Judge Robert D. Mariani in Scranton, for participating in a conspiracy to distribute heroin, cocaine, and other drugs in the Monroe-Berks County area of Pennsylvania.According to United States Attorney Peter Smith, the defendant, Luis Linarez , previously pleaded guilty to conspiring with others between 2010 and 2013, to distribute more than 500 grams of cocaine, more than 100 grams of heroin, and Oxycontin (oxycodone).
Linarez was indicted by a federal grand jury in June 2013, as a result of an investigation by the Drug Enforcement Administration, investigators from the Department of Homeland Security, the Pennsylvania State Police, the Pennsylvania Attorney General’s Office, and Berks County Detectives.
Judge Mariani also ordered Linarez to serve four years on supervised release following his prison sentence. Linarez must also pay a $100 special assessment.
The case was prosecuted by Assistant U.S. Attorney Francis P. Sempa.
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Prior Sex Offender from Albuquerque Pleads Guilty to Federal Child Pornography ChargeRead the Press Release
ALBUQUERQUE – Kyle Morrow, 30, of Albuquerque, N.M., pled guilty this morning to possession of a visual depiction of a minor engaged in sexually explicit conduct. Morrow’s plea agreement requires that he be sentenced to 120 months in prison because of his prior child pornography conviction.
Morrow was arrested on federal child pornography charges on Mar. 7, 2014, based on a criminal complaint alleging possession of child pornography. At the time of his arrest, Morrow was residing in a half-way house in Albuquerque as he was transiting from a federal prison for a child pornography conviction. According to the criminal complaint, FBI initiated an investigation into Morrow after staff at the half-way house found child pornography on his cellular phone and confiscated it. The FBI seized Morrow’s phone in Feb. 2014 pursuant to a search warrant and submitted the phone for forensic examination by the New Mexico Regional Forensic Laboratory. A forensic examination revealed that Morrow’s phone contained more than 1000 images consistent with child pornography.
Today Morrow entered a guilty plea to a federal information charging him with possession of a visual depiction of a minor engaged in sexually explicit conduct. In his plea agreement, Morrow admitted that on Feb. 4, 2014, he possessed visual depictions of child pornography while residing in a halfway house and while still in the custody of the Bureau of Prisons completing a 37-month sentence for a prior child pornography conviction. More specifically, Morrow admitted possessing child pornography images on his cellular phone.
Morrow has been in federal custody since his arrest and remains detained pending a sentencing hearing which has yet to be scheduled. Under the terms of his plea agreement, Morrow will be sentenced to 120 months in federal prison followed by a term of supervised release to be determined by the court. As part of the conditions of release Morrow will be required to register as a sex offender after completing his prison sentence.
This case was investigated by the Albuquerque office of the FBI and the New Mexico Regional Forensic Laboratory, and is being prosecuted by Assistant U.S. Attorney Jacob A. Wishard.
The case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice (DOJ) to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and DOJ’s Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
The case also was brought as a part of the New Mexico Internet Crimes Against Children (ICAC) Task Force’s mission, which is to locate, track, and capture Internet child sexual predators and Internet child pornographers in New Mexico. There are 74 federal, state and local law enforcement agencies associated with the New Mexico ICAC Task Force, which is funded by a grant administered by the New Mexico Attorney General’s Office. Anyone with information relating to suspected child predators and suspected child abuse is encouraged to contact federal or local law enforcement.