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Tuesday 6 January 2015
Convicted Dallas Lawyer Pleads Guilty to Additional Mail Fraud ChargeRead the Press Release
DALLAS — Andrew Lee Siegel, a Dallas attorney, appeared this morning before U.S. Magistrate Judge Irma C. Ramirez and pleaded guilty to Count Two of a Superseding Information charging mail fraud, announced John Parker, Acting U.S. Attorney for the Northern District of Texas.
In July 2014, Siegel pleaded guilty to one count of felony criminal infringement of a copyright – Count One of the Superseding Information.
Siegel, 54, faces a maximum statutory penalty of 20 years in federal prison and a $250,000 fine, or twice any pecuniary gain to the defendant or loss to the victim, on the mail fraud conviction and five years and a $250,000 fine on the criminal infringement conviction. Restitution may be ordered. Siegel remains on bond pending sentencing, which is set for April 22, 2015, before U.S. District Judge Ed Kinkeade.
In fall 2010, Siegel established Dynasty Spirits, LLC, and later Dynasty Spirits, Inc. and Speak Easy Distillers, LLC, to facilitate the production and bottling of “Nue Vodka.” In February 2012, Siegel created a private placement memorandum for Dynasty Spirits, Inc. (Dynasty) authorizing the sale of up to $2 million of common stock shares by Dynasty. In June 2013, Siegel became the registered agent and manager of Vanguard Spirits, LLC, which was established for the purpose of distilling, branding and marketing “Vanguard Vodka.”
From September 2011 through July 2012, Siegel collected approximately $1,595,000 from 35 investors for the sale of Dynasty stock certificates. Siegel concealed from Dynasty owners that he unlawfully used up to $410,000 of that amount for his personal benefit, which he had collected from no more than six of the 35 investors.
In November 2012, Dynasty owners suspected Siegel had unlawfully used investor funds, and when confronted, Siegel falsely stated that he had attempted to wire $185,000 in investor funds to Dynasty but the transfer was misrouted. The following month, Siegel created fraudulent and fictitious emails to Dynasty owners representing he attempted to wire transfer $185,000 from his bank account to the Dynasty owners’ bank account. Some of the fraudulent emails Siegel created contained copyrighted writings and the logo of The Northern Trust Company.
Later that month, Siegel created another fraudulent email to Dynasty owners that contained copyrighted writings, letterhead and logos of the Federal Reserve Bank Services. In fact, Siegel used several fraudulent and fictitious emails that falsely represented to Dynasty owners that he was in contact with The Northern Trust Company and the Federal Reserve Bank Services in connection with his “attempted” $185,000 wire transfer to the Dynasty owners. Siegel engaged in this fraudulent conduct to deceive the owners of Dynasty and convince them that he was making a good faith effort to transfer investor funds to the investors of Dynasty.
On June 24, 2013, Siegel fraudulently disbursed $210,000 from a client’s (EP) escrow account to use as part of a legal settlement payment to owners of Dynasty Spirits. Those owners were the victims in Siegel’s infringement conviction. Siegel continued to fraudulently disburse funds from EP’s escrow account through November 2014.
On May 21, 2014, Siegel reimbursed EP by fraudulently and secretly disbursing $285,310 of Vanguard Spirits investor funds. Siegel concealed this fraudulent disbursement of Vanguard investor funds from Vanguard investors and management.
When Siegel pleaded guilty to Count One in July 2014, he made no admission or reference to his fraudulent disbursement of funds from both EP’s escrow account and from Vanguard Spirits’ investor funds.
The FBI is investigating, and Assistant U.S. Attorney David L. Jarvis is in charge of the prosecution.
Columbus Man Sentenced to more than 17 years in Prison for Conspiracy to Distribute MethamphetamineRead the Press Release
United States Attorney Deborah R. Gilg announced that Matthew D. Renner, 35, of Columbus, Nebraska, was sentenced on January 5, 2015, to 212 months in prison by United States District Judge Laurie Smith Camp. Renner had previously pled guilty for his involvement in distributing methamphetamine in the Columbus area dating back to the summer of 2013.
The investigation began after Renner’s federal probation officer received information from law enforcement that Renner was involved in distributing methamphetamine in early 2014. On April 11, 2014, a search of Renner’s residence revealed approximately $1,930 in his dresser drawer, and approximately 15 grams of methamphetamine in a shed. At the time Renner was serving a Term of Supervised Release for a previous drug conviction. As a result, his sentence of imprisonment for the instant case was increased by two years.
This case was the result of an investigation by the Columbus Police Department and the United States Probation Office.Christopher Cook Charged with Violating Federal Firearms LawsRead the Press Release
ALBUQUERQUE – Christopher Cook, 36, of Albuquerque, N.M., has been charged with violating the federal firearms laws in a criminal complaint filed by the Bureau of Alcohol, Tobacco, Firearms and Explosives earlier today.
The criminal complaint charges Cook with being a felon in possession of a firearm. It alleges that Cook unlawfully possessed a firearm and ammunition on Jan. 3, 2015. According to the criminal complaint, Cook was prohibited from possessing either firearms or ammunition because he previously has been convicted of multiple felony offenses.
Cook was arrested earlier today on related state charges and currently is in state custody. He will be transferred to federal custody to answer to the federal charge in the criminal complaint.
If convicted of the charge in the criminal complaint, Cook faces up to ten years in federal prison. If the court determines that Cook is an armed career criminal, Cook faces an enhanced sentence of a mandatory minimum of 15 years in prison to a maximum of life imprisonment.
Charges in criminal complaints are mere accusations. Defendants are presumed innocent unless found guilty in a court of law.
This case was investigated by the Albuquerque Office of the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Albuquerque Police Department, the U.S. Marshals Service, the Albuquerque office of the FBI, the Bernalillo County Sheriff’s Office and the New Mexico State Police. Assistant U.S. Attorney David M. Walsh is prosecuting the case.
This case is being prosecuted as part of a federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders for federal prosecution with the goal of removing repeat offenders from communities in New Mexico for as long as possible.
Christopher Cook Federal Criminal Complaint
Cedar Rapids Man Pleads Guilty to Being A Felon in Possession of A FirearmRead the Press Release
Contact: Steve Young
A man who purchased a handgun and more than 100 rounds of ammunition pled guilty yesterday in federal court in Cedar Rapids.
Montarrance Wilson, age 27, from Chicago, Illinois, was convicted of one count of being a felon in possession of a firearm and ammunition.
In a plea agreement, Wilson admitted that, on July 16, 2013, he purchased a handgun and more than 100 rounds of ammunition from a Marion, Iowa, man who had pawned the firearm. In exchange for $700, the man retrieved the firearm from the Marion pawnshop and sold it, and the ammunition, to Wilson. Later that same day, probation officers made an unannounced home visit to another felon’s apartment. Wilson fled when the officers knocked on the door. Inside, the officers found a bag belonging to Wilson containing the firearm and ammunition. Wilson was arrested in Illinois on these charges in November 2014, and was removed to this district to answer charges. Wilson was prohibited from possessing a firearm because he is a felon, having been convicted in 2007 of Deliver of Cocaine in Cook County, Illinois.
Sentencing before United States District Court Chief Judge Linda R. Reade will be set after a presentence report is prepared. Wilson will remain in the custody of the United States Marshal pending sentencing. Wilson faces a possible maximum sentence of ten years’ imprisonment, a $250,000 fine, $100 in special assessments, and three years of supervised release following any imprisonment.
The case is being prosecuted by Assistant United States Attorney C.J. Williams and was investigated by the Federal Bureau of Investigation and the Cedar Rapids Police Department as part of the FBI’s Safe Street’s Task Force. Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 13-cr-84.
Cairo Man Sentenced for Firearm OffenseRead the Press Release
Follow @SDILNewsDeldrick L. Spence, 28, from Cairo, Illinois, was sentenced on January 5, 2015, in United States District Court in East St. Louis, Illinois, on one count of unlawful possession of a firearm by a previously convicted felon, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
Spence was sentenced to 57 months in prison, two years of supervised release, fined $200 and ordered to pay $100 special assessment, following his plea of guilty on September 22, 2014. The charges stem from a traffic stop conducted by the Clair County Sheriff’s Department that occurred on December 21, 2013, in Belleville, Illinois, when Spence, a passenger in the vehicle, admitted to owning a .9mm pistol uncovered during a search of the car, found inside the passenger seat side pocket. Spence also agreed to forfeiture of the firearm.
The investigation was conducted by the St. Clair County Sheriff’s Department and prosecuted by Special Assistant United States Attorney Jonathan S. Drucker.
Boise Man Sentenced for Bankruptcy Fraud for Concealing Interest in BusinessRead the Press Release
BOISE –Steven Gregory, 66, of Boise, was sentenced today to 30 months in prison and three years of supervised release for one count of bankruptcy fraud by asset concealment, U.S. Attorney Wendy J. Olson announced. Chief U.S. District Judge B. Lynn Winmill also ordered Gregory to pay $165,343 in restitution. Gregory pleaded guilty to the charge on October 21, 2014.
According to the plea agreement, Gregory filed bankruptcy in 2010 and during that bankruptcy proceeding, knowingly and fraudulently concealed a five percent ownership interest in a company. During the pendency of the bankruptcy case, Gregory demanded, and received, a payout of that interest in the amount of $330,464.19. However, Gregory failed to disclose both the ownership interest and the payment in his filed bankruptcy schedules and statements. Gregory intentionally and fraudulently concealed the interest and the payment from the Bankruptcy Court, the trustee, and his creditors.
The case was investigated by the Internal Revenue Service.
Bloomfield Township Theater Agrees to Improve Access for People with DisabilitiesRead the Press Release
The Maple Theater in Bloomfield Township has agreed to improve physical accessibility for people with disabilities at the theater, U.S. Attorney Barbara L. McQuade announced today.
The settlement agreement resolves an investigation under the Americans with Disabilities Act, alleging that the theater’s 2012 renovations allowed insufficient room for wheelchair seating. The complaint was filed by a Bloomfield Hills moviegoer with a mobility disability.
Under the agreement, the Maple Theater agreed to construct a new accessible unisex bathroom, relocate some of the existing accessible seating, ensure that the theater has accessible aisle seating and handrails in each auditorium, and make the bar area more accessible. Construction on some of the modifications is scheduled to begin this month, and the entire project should be completed within six months. Today’s agreement was reached under Title III of the ADA, which prohibits discrimination against individuals with disabilities by public accommodations.
“The law ensures that people with disabilities have the same access to public accommodations as all other Americans,” McQuade said. “This case is a reminder to businesses considering renovations that the Americans with Disabilities Act requires that building alterations comply with design standards.”
For more information on the ADA or today’s agreement with the Maple Theater, visit www.ada.gov or call the United States Justice Department’s toll-free ADA Information line at (800) 514-0301 or (800) 514-0383 (TTY) or the U.S. Attorney’s Civil Rights hotline at (313) 226-9151.
Bloomfield Man Sentenced to Forty-Six Months for Involuntary Manslaughter ConvictionRead the Press Release
Defendant Prosecuted as Part of Federal Initiative to Address
the Epidemic Incidence of Violence Against Native WomenALBUQUERQUE – Jasper Fernandez, 40, an enrolled member of the Navajo Nation who resides in Bloomfield, N.M., was sentenced this morning in federal court in Santa Fe, N.M., to 46 months in federal prison for his involuntary manslaughter conviction. Fernandez will be on supervised release for three years after completing his prison sentence. Fernandez also was ordered to pay $1,324.16 in restitution to cover funeral expenses for the victim.
Fernandez was arrested on Feb. 22, 2012, on a criminal complaint charging him with the Nov. 4, 2011, murder of a 36-year-old Navajo woman on the Navajo Indian Reservation. Fernandez entered a guilty plea on Dec. 22, 2014 to a felony information charging him with involuntary manslaughter. During the plea hearing, Fernandez admitted that he killed the victim while defending himself from a physical assault by the victim.According to court filings, Fernandez and the victim were both intoxicated when the victim began kicking and punching Fernandez because he criticized her. Fernandez, who lost a tooth as a result of the assault, pushed the victim away too hard and caused her to hit her head against the door pillar of a vehicle and die. In his plea agreement, Fernandez acknowledged that instead of seeking medical attention for the victim or contacting the police, he attempted to conceal his crime by burying the victim’s remains.
The case was investigated by the Albuquerque and Farmington offices of the FBI, the Navajo Nation Department of Public Safety and San Juan County Sheriff’s Office. Assistant U.S. Attorney Paul H. Spiers prosecuted the case.
This case was brought pursuant to the Tribal Special Assistant U.S. Attorney (Tribal SAUSA) Pilot Project in the District of New Mexico which is sponsored by the Justice Department’s Office on Violence Against Women under a grant administered by the Pueblo of Laguna. The Tribal SAUSA Pilot Project seeks to train tribal prosecutors in federal law, procedure and investigative techniques to increase the likelihood that every viable violent offense against Native women is prosecuted in either federal court or tribal court, or both. The Tribal SAUSA Pilot Project was largely driven by input gathered from annual tribal consultations on violence against women, and is another step in the Justice Department's on-going efforts to increase engagement, coordination and action on public safety in tribal communities.
Bergen County, N.J. Man Sentenced to 18 Months in Prison for Tax EvasionRead the Press Release
NEWARK, N.J. – A Bergen County, New Jersey, man was sentenced today to 18 months in prison for tax evasion, U.S. Attorney Paul J. Fishman announced.
Mikhail Goldman, 63, of Fort Lee, New Jersey, previously pleaded guilty before U.S. Magistrate Judge Michael A. Hammer to a one-count information charging him with tax evasion for failing to report a total of $600,000 in income that he received between 2007 and 2011. Goldman was sentenced to 18 months in prison by United States District Judge Faith S. Hochberg.
According to documents filed in this case and statements made in court:
Goldman received $12 million in checks written to various companies controlled by him, which he cashed for a fee of 5 percent of the face amount of each check. Goldman then failed to disclose those retained fees of $600,000 on his income tax returns to avoid paying the taxes he owed.In addition to the prison term, Judge Hochberg sentenced Goldman to three years of supervised release and ordered Goldman to pay over $120,000 in restitution to the United States.
U.S. Attorney Fishman credited special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen, for the investigation leading to today’s sentence.
The government is represented by Senior Litigation Counsel Andrew Leven of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark.
14-003
Defense counsel: George Farkas Esq., Brooklyn, New York
Baltimore, MD man convicted of selling crack cocaineRead the Press Release
1125 Chapline Street, Federal Building, Suite 3000 ● Wheeling, WV 26003
(304) 234-0100 ● Contact: Tara Tighe, Public Affairs SpecialistCLARKSBURG, WEST VIRGINIA – Justin Troy Clark, 24, of Baltimore, Maryland, was convicted in federal court for selling crack cocaine, United States Attorney William J. Ihlenfeld, II, announced today.
An investigation by the Eastern Panhandle Drug and Violent Crimes Task Force revealed that Clark sold crack cocaine in October 2013 in Martinsburg, West Virginia.Clark pleded guilty to one count of “Distribution of Cocaine Base.” He faces up to 20 years in prison and a fine of up to $1,000,000.00. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Paul Camilletti is prosecuting the cases on behalf of the government.
U.S. Magistrate Robert W. Trumble presided.
Baltimore Heroin Dealer Exiled to over 10 Years in PrisonRead the Press Release
Baltimore, Maryland – U.S. District Judge William D. Quarles, Jr., sentenced Davon Taylor, age 25, of Baltimore, today to 130 months in prison followed by three years of supervised release for conspiracy to distribute and possess with intent to distribute heroin.The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Assistant Special Agent in Charge Gary Tuggle of the Drug Enforcement Administration, Baltimore District Office; and Commissioner Anthony W. Batts of the Baltimore Police Department.
According to his plea agreement, from July through November 2012, Taylor conspired with Shawn Jackson and others to obtain and distribute heroin in and around the Park Heights and Belvedere neighborhoods of Baltimore. During the conspiracy Taylor and others operated a street level drug distribution shop in those areas, dispensing street level and wholesale quantities of heroin to customers, some of who traveled from Pennsylvania to acquire the heroin. In September 2012, the DEA obtained a court-ordered wiretap on Shawn Jackson’s cell phones. Based on these intercepted conversations, law enforcement determined that Taylor was working as a “street hitter” for the organization. On several occasions, DEA intercepted conversations between Jackson and customers in Pennsylvania, who were traveling to obtain heroin. Jackson would direct Taylor, or another “hitter” to serve the Pennsylvania customer the requested quantity of heroin
As a result of his participation in the drug conspiracy, Taylor was responsible for the distribution of between one and three kilograms of heroin.
Shawn Jackson, age 25, of Baltimore, previously pleaded guilty to his role in the conspiracy and was sentenced to five years in prison.
United States Attorney Rod J. Rosenstein commended the DEA and Baltimore Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys James T. Wallner and Scott A. Lemmon, who prosecuted the case.
Atlanta Man Sentenced for Theft of Government FundsRead the Press Release
ATLANTA - Rupert Morgan has been sentenced to two years, and three months in federal prison for theft of VA and Social Security funds paid to a beneficiary who died in 1997.
“Morgan stole more than $400,000 to which he was not entitled,” said United States Attorney Sally Quillian Yates. “This case is particularly troubling because he had a successful and lucrative career in the legal profession during the entire time period that he was committing this fraud on the United States government.”
Special Agent in Charge Monty Stokes, U.S. Department of Veterans Affairs Office of Inspector General (VA OIG) – Southeast Field Office, said “this sentencing is a testament to the excellent interagency cooperation with VA OIG, Social Security Administration, and the Department of Justice. We are committed to aggressively pursuing those who commit fraud against our nation’s veterans, the Department of Veterans Affairs and its programs.”
“The Social Security Office of the Inspector General is committed to pursuing those who violate the public’s trust by failing to report Social Security beneficiary deaths and continuing to receive the deceased’s benefits, sometimes for many years. We are working closely with Social Security and the Department of Justice to identify and prosecute these people and recover stolen funds, as one of our many efforts to protect the integrity of Social Security’s programs for those who rely on them now and into the future,” said Thomas Caul, Special Agent-in-Charge of the SSA OIG’s Atlanta Field Division.
According to United States Attorney Yates, the charges and other information presented in court: In December 1996, Morgan was a paralegal who has been employed by various law firms in the Atlanta area, and R.V., a VA disability and Social Security Administration (SSA) retirement beneficiary, was a patient at a personal care home owned and operated by Morgan’s now ex-wife. Morgan and R.V. opened a joint SunTrust bank account into which R.V.’s benefits were deposited. R.V. died in November 1997. After R.V.’s death, the defendant kept the joint bank account open while VA and SSA benefits continued to be deposited into the account.
In 2007, ten years after R.V.’s death, the defendant opened a second joint bank account in both his and R.V.’s names. He then frequently transferred money from the original joint account to the second joint account. Morgan often let large sums of money accumulate in the accounts before he spent it. When the SSA discovered the fraud, it was able to reclaim over $101,000 that was sitting in the defendant’s and R.V.’s joint bank account. In total, the defendant stole $258,045.00 from the VA and $142,372.00 from the SSA.
Morgan, 53, of Atlanta, Ga., has been sentenced to two years, three months in prison to be followed by three years of supervised release, and ordered to pay restitution in the amount of $299,164.75. Morgan was convicted of these charges on September 26, 2014, after he pleaded guilty.
This case was investigated by the Social Security Administration, Office of the Inspector General and Department of Veterans Affairs, Office of Inspector General.
Special Assistant United States Attorney Diane C. Schulman prosecuted the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao/gan/.
Armed Career Offender Sentenced to 192 Months in Prison for Possessing Multiple Stolen FirearmsRead the Press Release
SHREVEPORT, La. – United States Attorney Stephanie A. Finley announced today that a Bossier Parish man was sentenced to 192 months in prison for illegally possessing multiple firearms.
Donald W. “Duck” Reyenga, 49, of Bossier City, La., was sentenced by U.S. District Judge S. Maurice Hicks Jr. on one count of possession of a firearm by a person previously convicted of a felony. He was also sentenced to five years of supervised release after he completes his prison term. According to evidence presented at the August 6, 2014 guilty plea, members of the Bossier Combined Narcotics Task Force learned that Reyenga was attempting to sell stolen firearms. On April 17, 2014, agents scheduled a controlled purchase at a Bossier City hotel. There, Reyenga sold a Hi-Standard, model Double 9, .22 caliber revolver, a Savage model 93 .22LR caliber rifle, and ammunition. His sale of the stolen firearms was recorded and he was arrested. Agents later recovered another stolen rifle that Reyenga had sold that morning along with other items stolen from residences in Red River Parish.
During the guilty plea hearing, Reyenga admitted he was an Armed Career Offender as defined by the Armed Career Criminal Act (ACCA). The ACCA increases the mandatory minimum sentence to 15 years for a defendant if he has three previous convictions for either a violent felony or a serious drug offense. Reyenga has numerous previous felony convictions in Bossier and Caddo parishes including attempted manslaughter, burglary, attempted aggravated burglary, distribution of marijuana, possession of cocaine and illegal possession of stolen things.
“This sentence is a reminder that it is illegal for felons to sell or possess firearms,” Finley stated. “Those with felony records must comply with firearms laws. We will vigorously prosecute dangerous and persistent felons in order to protect the public”
The ATF and the Bossier Combined Narcotics Task Force conducted the investigation. Assistant U.S. Attorney Robert W. Gillespie Jr. prosecuted the case as part the Department of Justice Project Safe Neighborhoods initiative. This initiative is designed to reduce firearm crimes by using federal statutes to remove dangerous and persistent felons from the community.
$18 Million Seized from Owners of New England Compounding CenterRead the Press Release
BOSTON – More than $18,000,000 was seized from accounts connected to the owners of New England Compounding Center (NECC). The funds were seized from 13 different financial institutions, pursuant to 26 seizure warrants issued by the federal court in Boston. The seizure warrants were unsealed today.
Approximately $1,500,000 was seized from three accounts held by Barry J. Cadden, a shareholder and the head pharmacist of NECC. Cadden was recently charged in a 131-count criminal indictment along with 13 other individuals, in connection with the 2012 fungal meningitis outbreak caused by contaminated medications made by NECC. Among the charges that Cadden faces are 25 acts of second degree murder as well as mail fraud, conspiracy and violations of the Food, Drug and Cosmetic Act.
In addition, approximately $16,800,000 was frozen in accounts held by or connected to Carla Conigliaro, 51, and Douglas A. Conigliaro, 53, of Dedham, Mass. Carla Conigliaro is the majority shareholder of NECC, and Douglas A. Conigliaro is her husband. Both were recently charged with transferring assets following the 2012 fungal meningitis outbreak.
According to the allegations in the application for the seizure warrants unsealed today, the Conigliaros transferred millions the same month that NECC surrendered its pharmacy license and shortly before NECC’s petition for bankruptcy. Carla and Douglas A. Conigliaro also allegedly transferred millions more after the bankruptcy court issued two orders prohibiting them from transferring any assets.
United States Attorney Carmen M. Ortiz; Jeffrey Ebersol, Special Agent in Charge of the Food and Drug Administration, Office of Criminal Investigations; and Shelly Binkowski, Postal Inspector in Charge of the U.S. Postal Inspection Service, Boston Division, made the announcement today. The asset forfeiture seizures are being handled by Assistant U.S. Attorney Veronica M. Lei of Ortiz’s Asset Forfeiture Unit. The case is being prosecuted by Assistant U.S. Attorneys George P. Varghese and Amanda P.M. Strachan of the Health Care Fraud Unit for the U.S. Attorney’s Office in the District of Massachusetts, and Trial Attorney John W.M. Claud of the Civil Division’s Consumer Protection Branch.
Monday 5 January 2015
Warren, Ohio, Man Sentenced to Prison for Role in Ohio to Western PA Cocaine Trafficking PipelineRead the Press Release
PITTSBURGH - A resident of Warren, Ohio, has been sentenced in federal court to 21 months imprisonment followed by 3 years supervised release on his conviction of violating federal drug trafficking laws, United States Attorney David J. Hickton announced today.
Senior United States District Judge Terence F. McVerry imposed the sentence on Allan Williams, 40.
According to information presented to the court, from in and around January 2011 and continuing thereafter to in and around June 2012, Williams conspired with others to distribute and possess with intent to distribute cocaine.
The prosecution of Williams was the result of a long-term investigation that involved wiretaps on cell phones utilized by several members of the conspiracy. At the conclusion of the investigation, twenty defendants (including Williams) were charged in a large-scale cocaine conspiracy that operated between Warren, Ohio, and Washington, Pennsylvania. All twenty defendants have since pleaded guilty. The same investigation also resulted in the prosecution of ten defendants charged in a large-scale heroin conspiracy that operated between Detroit, Michigan, and Washington, Pennsylvania. All ten defendants have likewise pleaded guilty.
Assistant United States Attorneys Charles A. Eberle and Barbara K. Doolittle prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Federal Bureau of Investigation and the Pennsylvania State Police for the investigation leading to the successful prosecution of Williams.
Two Defendants Charged for their Role in an Attempted Coup in the GambiaRead the Press Release
Defendants Charged with Conspiracy to Violate the Neutrality Act and Conspiracy to Possess Firearms in Furtherance of a Crime of Violence
United States Attorney General Eric Holder, Assistant Attorney General for National Security John P. Carlin, United States Attorney Andrew M. Luger for the District of Minnesota, and Federal Bureau of Investigation Special Agent in Charge Richard T. Thornton of the Minneapolis Division today announced a criminal complaint charging Cherno Njie, 57, and Papa Faal, 46, for their role in a recent attempted coup in The Gambia. Both men are in custody and are expected to have initial appearances in court today. Njie will appear in United States District Court in Baltimore, Maryland. Faal will appear in U.S. District Court in Minneapolis, Minnesota. Both defendants are charged with conspiring to violate the Neutrality Act by making an expedition against a friendly nation from the United States and conspiring to possess firearms in furtherance of a crime of violence.
On Dec. 30, 2014, there was an unsuccessful attempted coup against the government of The Gambia. The Gambia is a country in West Africa bordered by Senegal and the Atlantic Ocean.
“These defendants stand accused of conspiring to carry out the violent overthrow of a foreign government, in violation of U.S. law,” said Attorney General Eric Holder. “The United States strongly condemns such conspiracies. With these serious charges, the United States is committed to holding them fully responsible for their actions.”
According to the criminal complaint and documents filed in court, in December 2014, Cherno Njie and Papa Faal separately traveled from the United States to The Gambia for the purpose of overthrowing the Gambian government. Faal is a dual U.S./Gambian citizen and a resident of Brooklyn Center, Minnesota. Njie, a U.S. citizen of Gambian descent and a resident of Austin, Texas, is a businessman who served as financier and leader of the conspiracy. Njie and his co-conspirators expected that Njie would have served as the interim leader of The Gambia had the coup attempt succeeded.
According to the criminal complaint, approximately 10-12 members of the conspiracy entered The Gambia to carry out the coup attempt, with the expectation that others in the country would join and assist them. Prior to departing for The Gambia, between August and October 2014, Faal and other co-conspirators purchased multiple firearms, including M4 semi-automatic rifles, and shipped them to The Gambia for use in the coup attempt. Members of the conspiracy also acquired night-vision goggles, body armor, ammunition, black military style uniform pants, boots, and other personal equipment.
According to the criminal complaint, on Dec. 30, 2014, a number of the co-conspirators, including Faal, met in the woods near the State House in Banjul, which is the home of the Gambian president, and split into two assault teams. Njie was not present at that meeting, instead waiting in a safe place until the assault teams took control of the facility. However, when one of the assault teams approached the State House and fired a shot into the air, the team began taking heavy fire from the guard towers. Although numerous conspirators on the assault teams were killed or injured during the failed attempt to take control of the government building, Faal was able to flee the scene and he ultimately returned to the U.S. Njie also returned to the U.S. Both men have since been arrested.
This investigation is being led by the Federal Bureau of Investigation and its partners on Joint Terrorism Task Forces in multiple field offices.
Assistant U.S. Attorney Charles Kovats of the United States Attorney’s Office for the District of Minnesota is prosecuting this case, with assistance from Richard Scott, a Deputy Chief in the Counterespionage Section of the Justice Department's National Security Division. A number of other U.S. Attorney’s Offices, including those in the District of Maryland and the Western District of Texas provided critical support during the investigation.
Defendant Information:
CHERNO NJIE, 57
Austin, Texas.
Charges:
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Conspiracy to violate the Neutrality Act, 1 count
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Conspiracy to possess a firearm in furtherance of a crime of violence, 1 count
PAPA FAAL, 46
Brooklyn Center, Minnesota.
Charges:
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Conspiracy to violate the Neutrality Act, 1 count
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Conspiracy to possess a firearm in furtherance of a crime of violence, 1 count
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Two Defendants Charged for Their Role in an Attempted Coup in the GambiaRead the Press Release
Defendants Charged with Conspiracy to Violate the Neutrality Act and Conspiracy to Possess Firearms in Furtherance of a Crime of Violence
United States Attorney General Eric Holder, United States Attorney for the District of Minnesota Andrew M. Luger, Assistant Attorney General for National Security John P. Carlin, and Federal Bureau of Investigation Special Agent in Charge of the Minneapolis Division Richard T. Thornton today announced a criminal complaint charging CHERNO NJIE, 57, and PAPA FAAL, 46, for their role in a recent attempted coup in The Gambia. Both men are in custody and are expected to have initial appearances in court today. NJIE will appear in United States District Court in Baltimore, Maryland. FAAL will appear in U.S. District Court in Minneapolis, Minnesota. Both defendants are charged with conspiring to violate the Neutrality Act by making an expedition against a friendly nation from the United States and conspiring to possess firearms in furtherance of a crime of violence. 1
On December 30, 2014, there was an unsuccessful attempted coup against the government of The Gambia. The Gambia is a country in West Africa bordered by Senegal and the Atlantic Ocean.
“These defendants stand accused of conspiring to carry out the violent overthrow of a foreign government, in violation of U.S. law,” said Attorney General Eric Holder. “The United States strongly condemns such conspiracies. With these serious charges, the United States is committed to holding them fully responsible for their actions.”
United States Attorney for the District of Minnesota Andrew M. Luger said: “This case would not be possible without the dedication of prosecutors around the country and FBI agents around the world, who worked non-stop to uncover evidence of the plot to overthrow the Gambian government. My office will continue to work cooperatively with our law enforcement partners here and abroad to bring these defendants to justice.”
FBI Special Agent in Charge for the Minneapolis Division Richard T. Thornton said: “This investigation reinforces the continued success of the FBI's Joint Terrorism Task Force in Minneapolis. The FBI, along with its many task force partners, remains committed to disrupting and preventing political violence no matter what form it takes.”
According to the criminal complaint and documents filed in court, in December 2014, CHERNO NJIE and PAPA FAAL separately traveled from the United States to The Gambia for the purpose of overthrowing the Gambian government. FAAL is a dual U.S./Gambian citizen and a resident of Minnesota. NJIE, a U.S. citizen of Gambian descent and a resident of Texas, is a businessman who served as financier and leader of the conspiracy. NJIE and his co-conspirators expected that NJIE would have served as the interim leader of the Gambia had the coup attempt succeeded.
According to the criminal complaint, approximately 10-12 members of the conspiracy entered The Gambia to carry out the coup attempt, with the expectation that others in the country would join and assist them. Prior to departing for The Gambia, between August and October 2014, FAAL and other co-conspirators purchased multiple firearms, including M4 semi-automatic rifles, and shipped them to The Gambia for use in the coup attempt. Members of the conspiracy also acquired night-vision goggles, body armor, ammunition, black military style uniform pants, boots, and other personal equipment.
According to the criminal complaint, on December 30, 2014, a number of the co-conspirators, including FAAL, met in the woods near the State House in Banjul, which is the home of the Gambian President, and split into two assault teams. NJIE was not present at that meeting, instead waiting in a safe place until the assault teams took control of the facility. However, when one of the assault teams approached the State House and fired a shot into the air, the team began taking heavy fire from the guard towers. Although numerous conspirators on the assault teams were killed or injured during the failed attempt to take control of the government building, FAAL was able to flee the scene and he ultimately returned to the U.S. NJIE also returned to the U.S. Both men have since been arrested.
The criminal complaint (including the affidavit) is attached as a pdf document.
This investigation is being led by the Federal Bureau of Investigation and its partners on Joint Terrorism Task Forces in multiple field offices. U.S. Attorney Luger commended the many agents, analysts, and prosecutors in multiple offices who are responsible for this ongoing investigation.
Assistant U.S. Attorney Charles Kovats of the United States Attorney’s Office for the District of Minnesota is prosecuting this case, with assistance from Richard Scott, a Deputy Chief in the Counterespionage Section of the Justice Department's National Security Division. A number of other U.S. Attorney’s Offices, including those in the District of Maryland and the Western District of Texas provided critical support during the investigation.
Defendant Information:
CHERNO NJIE, 57
Austin, Tex.
Charges:
• Conspiracy to violate the Neutrality Act, 1 count
• Conspiracy to possess a firearm in furtherance of a crime of violence, 1 count
PAPA FAAL, 46
Brooklyn Center, Minn.
Charges:
• Conspiracy to violate the Neutrality Act, 1 count
• Conspiracy to possess a firearm in furtherance of a crime of violence, 1 countComplaint and Affidavit
1 The charges contained in the criminal complaint are merely allegations, and the defendants are presumed innocent unless and until proven guilty.
The charges are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Topeka Woman Sentenced for Aiding Robbery, Unlawful Access to State RecordsRead the Press Release
TOPEKA, KAN. - A Topeka woman was sentenced Monday to three years in federal prison for aiding and abetting an armed robbery at a Red Robin restaurant, U.S. Attorney Barry Grissom. The sentence also includes a $1,000 fine in connection with her plea in a separate count to unlawfully accessing state motor vehicle records while she worked for the Kansas Department of Revenue.
Johanna Ross, 23, Topeka, Kan., pleaded guilty to one count of aiding and abetting an armed robbery and one count of unlawfully accessing a state database. In her plea, she admitted she assisted co-defendants Derick Renee Crawford and Travis Jeremy Coffman during an armed robbery Aug. 18, 2013, at the Red Robin restaurant at 6230 S.W. 6th in Topeka.
Crawford, who was armed with a handgun, and Coffman, who was armed with a can of mace, robbed the restaurant. During the robbery, they held employees at gunpoint and threatened to kill them.
In her plea, Ross admitted she was present in the parking lot when Crawford and Coffman planned the robbery and she drove Crawford away after the robbery. She also admitted retrieving the firearm used by Crawford, the pink can of mace used by Coffman and a shirt used by Crawford during the robbery.
In a separate count not related to the robbery, Ross admitted that while she worked for the Kansas Department of Revenue she used her access to a database of motor vehicle records to retrieve the address of an individual and pass that information on to a third party for payment, all in violation of federal law.
Co-defendants included:
Derick Renee Crawford, who was sentenced to 84 months in federal prison.
Travis Jeremy Coffman, who was sentenced to 49 months in federal prison.
Grissom commended the Topeka Police Department, the FBI, the Shawnee County District Attorney’s Office and Assistant U.S. Attorney Jared for their work on the case.
SoCal Doctor Who Distributed Addictive Painkiller Hydrocodone and Laundered More Than $1 Million in Illegal Proceeds Sentenced to over 5 Years in Federal PrisonRead the Press Release
LOS ANGELES – A Los Angeles-area doctor who was convicted last summer of narcotics trafficking for illegally distributing the powerful painkiller best known by the brand names Vicodin and Norco was sentenced today to 63 months in federal prison.
Dr. Andrew Sun, 79, of La Mirada, was sentenced this afternoon by United States District Judge Manual Real.
A federal jury in August found Sun guilty of 14 counts of narcotics distribution after determining that he illegally issued prescriptions for hydrocodone and alprazolam – the drug best known as Xanax – in exchange for cash payments from “patients.” According to a sentencing memo filed by federal prosecutors, “When prescribed together, these drugs form an especially potent and deadly cocktail for which there is no legitimate medical purpose.”
The evidence at trial showed that Sun issued more than 24,000 prescriptions over a three-year period and generated more than $1.1 million in cash through what prosecutors called “a cash-and-carry narcotics store.”
Sun was also found guilty of three counts of money laundering.
“The jury convicted defendant of using his pedigree as a doctor to endanger his patients’ lives and to profit from their addiction,” prosecutors said in court papers. “Consistent with the guilty verdicts, defendant acted with no legitimate medical purpose and defendant sought to cover his tracks through systematic fraud and deception, including his attempt to conceal the hundreds of thousands of dollars of illegal proceeds.”
Sun, who operated medical clinics in San Gabriel and East Los Angeles, issued prescriptions to a dozen “patients” – in reality, undercover law enforcement officers – who made cash payments. Two medical experts retained by the government to review Sun’s interaction with the undercover operatives (UCs) concluded that “that there was no medical legitimacy to defendant’s meetings with the UCs, and that his conduct was an extreme departure from the accepted standard of care.”
Sun’s conviction last year in United States District Court was the second time he was found culpable for illegally writing prescriptions. In 2007, the Medical Board of California placed Sun on probation for four years and required him to complete special training and to generate special reports on his activities. But in 2010, the Medical Board found that he submitted false statements to the regulatory agency and extended his probation for another four years, which included a ban on prescribing certain medications, including the highly addictive drug best known under the brand name OxyContin.
The investigation into Sun was conducted by the Drug Enforcement Administration, IRS - Criminal Investigation, the Medical Board of California, the California Department of Health Care Services and the Monterey Park Police Department.
Release No. 15-001
Sequim Drug Trafficker Pleads Guilty to Meth Distribution ConspiracyRead the Press Release
The former owner of ‘Sellin Style’ car dealership in Sequim, Washington pleaded guilty last week to conspiracy to distribute methamphetamine and possession of methamphetamine with intent to distribute, announced Acting U.S. Attorney Annette L. Hayes. TIMOTHY P. SMITH, 30, was arrested in February 2014, following a high speed chase that ended after two sets of spike strips were placed on the highway. All of SMITH’s charged co-conspirators, Kelsey J. Davis, Tammy R. Coburn, Holli A. Bell, Jacob E. Davis, and Charles D. Aslin, have also pleaded guilty in the case. SMITH faces a mandatory minimum ten years in prison, and up to life imprisonment, when sentenced by U.S. District Judge Robert J. Bryan on March 27, 2015.
According to records in the case, SMITH and his cohorts were under investigation by federal law enforcement since 2011. Some of the federally indicted offenses, investigated by local law enforcement, went back even further. In particular, SMITH sold methamphetamine to a person working with law enforcement on multiple occasions in June, July and August 2013 at his ‘Sellin Style’ car dealership on Old Blyn Highway near Sequim.
In conjunction with a separate investigation and take-down of a larger drug ring, which was supplying methamphetamine to SMITH and others, law enforcement arrested SMITH as he traveled back to Sequim from Kitsap County on Sunday evening, February 23, 2014. Shortly after SMITH’s vehicle crossed the Hood Canal Bridge, the Washington State Patrol pulled the car over. After initially stopping, SMITH sped away, traveling at speeds nearing 100 mph and weaving into the lane for oncoming traffic. Troopers noticed white bags tossed from the car; inside was 1.6 pounds of methamphetamine. The car hit one set of spike strips and continued on. After hitting a second set of spike strips the car came to a halt and SMITH and his girlfriend, Kelsey Davis, were taken into custody. Davis also had $4,000 in cash on her person, which she revealed in a monitored jail call to have been given to her by SMITH during the police chase.
The case was investigated by the FBI, ATF, and Olympic Peninsula Narcotics Enforcement Team (OPNET), a task force containing officers from Clallam County Sheriff’s Office, Jefferson County Sheriff’s Office, Port Angeles Police Department, Sequim Police Department, Neah Bay Department of Public Safety, Elwha Klallam Police, LaPush Police, the U.S. Coast Guard, U.S. Border Patrol, the Washington Department of Corrections, Washington State Patrol and the West Sound Narcotics Enforcement Team (WestNet).
The case is being prosecuted by Assistant United States Attorney Gregory A. Gruber.
Riverside County Man Pleads Guilty to Conspiracy to Grow Marijuana and Setting Fires in National ForestRead the Press Release
FRESNO, Calif. — Edgardo Fournier, aka Edgardo Fournier-Nigaglioni, 46, of Perris, pleaded guilty today to conspiring to manufacture, distribute and possess with intent to distribute marijuana, and setting timber afire in the Sequoia National Forest, U.S. Attorney Benjamin B. Wagner announced.
According to the guilty plea, from about April 1, 2014 to July 12, 2014, Fournier helped water and tend 2,090 marijuana plants at a grow site in the Smith Canyon area of the Sequoia National Forest in Kern County. He admitted that on July 11 and 12, he lit fires in the vicinity of the grow site within the boundaries of the federally designated Kiavah Wilderness Area. The fires converged and became known as the Nicolls Fire. The Nicolls Fire destroyed about 1,680 acres of public land causing over $6.5 million of damage. The fire did not damage the marijuana cultivation site, which also caused significant damage to the land and natural resources of the forest.
Fournier is scheduled for sentencing on March 30, 2015. He faces a prison term of between five and 40 years for the drug conspiracy and up to a $5 million fine. The arson charge carries a maximum penalty of five years in prison and $250,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory sentencing factors and the Federal Sentencing Guidelines, which take into account a number of variables.
This case is the product of an investigation by the U.S. Forest Service, the U.S. Bureau of Land Management, and the Kern County Sheriff’s Office. Assistant United States Attorney Karen A. Escobar is prosecuting the case.
Portsmouth Man Sentenced to Eleven Years for Receiving Child PornographyRead the Press Release
NORFOLK, Va. – Justin Carter, 31, of Portsmouth, was sentenced today to 132 months in prison, followed by a life term of supervised release for receipt of child pornography.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia and Clark E. Settles, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations Washington, D.C., made the announcement after sentencing by U.S. District Judge Mark S. Davis.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:14cr116.
Carter pleaded guilty on August 27, 2014. According to court documents, Carter was engaged in the soliciting, receiving, and sharing of images of child pornography via the Internet using a computer at a friend’s home. A forensic examination of the computer showed that Carter exchanged numerous emails with other individuals in which they attached pictures of children engaged in various forms of sexually explicit conduct. The images included prepubescent girls performing sexual acts with adults. Some of the children depicted were of toddler age. The computer contained approximately 547 images of child pornography on the hard drive.
This case was investigated by Homeland Security Investigations. Assistant U.S. Attorney Randy Stoker is prosecuting the case on behalf of the United States.Tweet
Portsmouth Man Sentenced to Eleven Years for Receiving Child PornographyRead the Press Release
NORFOLK, Va. – Justin Carter, 31, of Portsmouth, was sentenced today to 132 months in prison, followed by a life term of supervised release for receipt of child pornography.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia and Clark E. Settles, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations Washington, D.C., made the announcement after sentencing by U.S. District Judge Mark S. Davis.
Carter pleaded guilty on August 27, 2014. According to court documents, Carter was engaged in the soliciting, receiving, and sharing of images of child pornography via the Internet using a computer at a friend’s home. A forensic examination of the computer showed that Carter exchanged numerous emails with other individuals in which they attached pictures of children engaged in various forms of sexually explicit conduct. The images included prepubescent girls performing sexual acts with adults. Some of the children depicted were of toddler age. The computer contained approximately 547 images of child pornography on the hard drive.
This case was investigated by Homeland Security Investigations. Assistant U.S. Attorney Randy Stoker is prosecuting the case on behalf of the United States.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:14cr116.Tweet
North Jersey Doctor Sentenced to One Year of House Arrest and Three Years' ProbationRead the Press Release
Admitted Accepting Bribes for Test Referrals to Clinical Laboratory
NEWARK, N.J. – A doctor with a practice in Paterson, New Jersey, was sentenced today to three years’ probation, which includes one year of house arrest with electronic monitoring, for accepting more than $200,000 in bribes from Parsippany, New Jersey-based Biodiagnostic Laboratory Services LLC (BLS) as part of a long-running scheme operated by the lab, its president, and numerous associates, U.S. Attorney Paul J. Fishman announced.
Claudio Dicovsky, 52, of Fort Lee, 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 Chesler imposed the sentence today in Newark federal court.
Including Dicovsky, 33 people – 22 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 this and other cases and statements made in court:
Dicovsky admitted he agreed with BLS president David Nicoll, 40, of Mountain Lakes, New Jersey, to accept bribes in exchange for his referral of blood specimens. To disguise those bribes, Dicovsky and BLS entered into a sham lease agreement and a sham service agreement in which the monthly bribe payments of more than $5,000 were characterized as “lease” and “service” payments. While the lease agreement purported to be for 1,000 square feet of space, little or no space was allocated to BLS in Dicovsky’s medical office in Paterson. Between November 2006 and August 2009, Dicovsky received more than $224,000 in bribe payments from BLS, and BLS made more than $800,000 through testing on blood specimens referred by Dicovsky.
In addition to probation and house arrest, Judge Chesler fined Dicovsky $75,000 and sentenced him to 1,500 hours of community service. He must also forfeit more than $222,000.
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 Thomas O’Donnell; IRS– Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen; 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 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 $620 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.
15-002
Defense counsel: Gerald Miller Esq., Jersey City, N.J.
Lexington Woman Sentenced to 18 Months for Immigration and Labor ViolationsRead the Press Release
Defendant Harbored Undocumented Mexican Migrant for Labor on Tobacco Farm
The Department of Justice announced today that Pedra Perez-Gumeta, 52, of Lexington, Kentucky, was sentenced to serve 18 months in federal prison by United States Senior District Court Judge Joseph M. Hood for harboring an undocumented Mexican migrant for labor at a tobacco farm, illegally re-entering the United States after deportation and failing to pay a minimum wage to the undocumented Mexican migrant. Judge Hood also ordered Perez-Gumeta to pay restitution to the Mexican migrant in the amount of $1,311 and mandatory special assessments totaling $210.
Perez-Gumeta previously admitted that she had brought a woman to Lexington from Mexico to provide the woman with a job. Perez-Gumeta also admitted that she knew the woman was from Mexico and not legally within the United States, nor was the woman able to work legally in the United States. Perez-Gumeta also admitted that she had been previously deported from the United States and that she had re-entered the United States illegally. Perez-Gumeta further admitted that she did not pay the woman for all of the labor the woman performed, instead keeping a portion of the woman’s wages for herself. Perez-Gumeta pleaded guilty to the charges in September of 2014. In sentencing Perez-Gumeta, the court found that the defendant used coercion in the course of harboring the undocumented Mexican woman for financial gain.
Under federal law, Perez-Gumeta must serve 85 percent of her prison sentence, and, upon release, will be under the supervision of the United States Probation Office for one year, unless she is deported.
Kerry B. Harvey, United States Attorney for the Eastern District of Kentucky, Steven L. Igyarto, Resident Agent in Charge, Homeland Security Investigations (HSI), Department of Homeland Security (DHS), Rodney Brewer, Commissioner, Kentucky State Police (KSP), and Mark Barnard, Chief, Lexington-Fayette Urban County Government Division of Police, jointly made the announcement today after the sentencing.
The investigation was conducted by the DHS-HSI, the KSP, and the Lexington Police Department. The United States was represented by Trial Attorney Victor Boutros of the Civil Rights Division’s Human Trafficking Prosecution Unit and Assistant United States Attorneys Hydee R. Hawkins and David A. Marye.
Lexington Woman Sentenced to 18 Months for Immigration and Labor ViolationsRead the Press Release
Defendant Harbored Undocumented Mexican Migrant for Labor on Tobacco Farm
WASHINGTON, DC - The Department of Justice announced today that Pedra Perez-Gumeta, 52, of Lexington, Kentucky, was sentenced to serve 18 months in federal prison by United States Senior District Court Judge Joseph M. Hood for harboring an undocumented Mexican migrant for labor at a tobacco farm, illegally re-entering the United States after deportation and failing to pay a minimum wage to the undocumented Mexican migrant. Judge Hood also ordered Perez-Gumeta to pay restitution to the Mexican migrant in the amount of $1,311 and mandatory special assessments totaling $210.
Perez-Gumeta previously admitted that she had brought a woman to Lexington from Mexico to provide the woman with a job. Perez-Gumeta also admitted that she knew the woman was from Mexico and not legally within the United States, nor was the woman able to work legally in the United States. Perez-Gumeta also admitted that she had been previously deported from the United States and that she had re-entered the United States illegally. Perez-Gumeta further admitted that she did not pay the woman for all of the labor the woman performed, instead keeping a portion of the woman’s wages for herself. Perez-Gumeta pleaded guilty to the charges in September of 2014. In sentencing Perez-Gumeta, the court found that the defendant used coercion in the course of harboring the undocumented Mexican woman for financial gain.
Under federal law, Perez-Gumeta must serve 85 percent of her prison sentence, and, upon release, will be under the supervision of the United States Probation Office for one year, unless she is deported.
Kerry B. Harvey, United States Attorney for the Eastern District of Kentucky, Steven L. Igyarto, Resident Agent in Charge, Homeland Security Investigations (HSI), Department of Homeland Security (DHS), Rodney Brewer, Commissioner, Kentucky State Police (KSP), and Mark Barnard, Chief, Lexington-Fayette Urban County Government Division of Police, jointly made the announcement today after the sentencing.
The investigation was conducted by the DHS-HSI, the KSP, and the Lexington Police Department. The United States was represented by Trial Attorney Victor Boutros of the Civil Rights Division’s Human Trafficking Prosecution Unit and Assistant United States Attorneys Hydee R. Hawkins and David A. Marye.
Las Vegas Man who Earned over $7 Million during 2007 Sentenced to 10 Months in Prison for Failing to File a Tax ReturnRead the Press Release
LAS VEGAS, Nev. – A Las Vegas man who earned over $7 million during 2007 and failed to file a 2008 federal tax return with the IRS, was sentenced today to 10 months in prison, one year of supervised release, and ordered to pay approximately $2.5 million in restitution to the IRS, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.
“We work with the IRS to enforce the nation's tax laws,” said U.S. Attorney Bogden. “We will do this fully, fairly, and consistently, through both criminal and civil litigation, in order to promote voluntary compliance with the tax laws and to maintain public confidence in the integrity of the tax system.”
Shawn Lampman, 49, was sentenced by U.S. District Judge James C. Mahan. Lampman was originally charged in April 2013 and pleaded guilty on April 14, 2014, to one count of failure to file an individual tax return. He must report to federal prison by April 6, 2015.
According to the guilty plea agreement, during 2007, Lampman earned income in excess of $7 million and willfully failed to make and file an individual tax return with the IRS on or before April 15, 2008.
The case was investigated by IRS Criminal Investigation and prosecuted by First Assistant U.S. Attorney Steven W. Myhre.
Las Vegas Man Sentenced to 15 Months in Prison for Tax EvasionRead the Press Release
LAS VEGAS, Nev. – A Las Vegas man who formerly operated a well-known local adult entertainment club and owned an escort service business, was sentenced today by U.S. District Judge Phillip M. Pro to 15 months in prison for his guilty plea to tax evasion, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.
Emannouil “Manny” Varagiannis, 44, was also ordered to pay $230,651 in restitution and to forfeit two homes in Las Vegas. Varagiannis was originally charged in September 2012, and pleaded guilty on April 9, 2014, to one count of tax evasion. He must report to federal prison by April 3, 2015.
“We work with the IRS to enforce the nation's tax laws,” said U.S. Attorney Bogden. “We will do this fully, fairly, and consistently, through both criminal and civil litigation, in order to promote voluntary compliance with the tax laws and to maintain public confidence in the integrity of the tax system.”
According to the guilty plea agreement and court records, IRS Criminal Investigation began investigating Varagiannis in 2012 as a result of him conducting unusual banking activities. At that time, Varagiannis was the owner of Midnight Entertainers, an adult escort service in Las Vegas. The investigation revealed that Varagiannis was structuring deposits into two financial institution accounts in order to avoid reporting the money to the IRS. Specifically, between Jan. 6, 2009, and Aug. 16, 2012, Varagiannis made 182 deposits totaling approximately $1.5 million. Further investigation revealed that Varagiannis and his wife used the funds from the two accounts to purchase two separate homes for cash. Further investigation also revealed that Varagiannis failed to declare federal taxes he owed for the years 2009 through 2011, totaling $230,651, and that he willfully took affirmative steps to evade or defeat payment of the taxes, including conducting transactions to avoid financial institution reporting requirements to the IRS.
The case was investigated by IRS Criminal Investigation and the Las Vegas Metropolitan Police Department, and prosecuted by Assistant U.S. Attorney Cristina D. Silva.Kentucky Woman Sentenced for Production of Child PornographyRead the Press Release
NORFOLK, Va. – Rebecca Mae Gibbs, age 24, of Lewisport, KY, was sentenced today to 17 ½ years in prison, followed by a life term of supervised release for production of child pornography.
Dana J. Boente, United States Attorney for the Eastern District of Virginia and Susan E. Triesch,Special Agent-in-Charge of the Naval Criminal Investigative Service Norfolk Field Office, made the announcement after sentencing by United States District Judge Mark S. Davis.
Gibbs pled guilty to the charge on September 30, 2014. According to court documents, Gibbs’s co-defendant, Douglas Lawrence True, 23, of Clarksville, Indiana, asked her to produce images and videos of child pornography, and facilitate visits wherein True could sexually abuse the minor victim, who had not reached one year of age. Gibbs performed a sexual act on the victim, recorded it on video, and sent it via cellular phone to True, located in the Eastern District of Virginia. True pled guilty to receipt of child pornography on November 10, 2014 and is scheduled to be sentenced on February 20, 2015. True is facing a maximum of 20 years in prison.
This case was investigated by the Naval Criminal Investigative Service, with the assistance of the Kentucky State Police. Assistant United States Attorney Joseph Kosky is prosecuting the case on behalf of the United States.A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:14-cr-97.
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Kankakee Man Sentenced to More Than 22 Yearsin Prison for Armed Robbery of Credit UnionRead the Press Release
Springfield, Ill. – Today, U.S. District Judge Sue E. Myerscough sentenced Brandon J. Thomas, 34, of Kankakee, Ill., to prison for the August 2012 armed robbery of the SDC Employees Credit Union in Kankakee. Thomas was ordered to serve a total of 272 months (22 years, eight months) in the federal Bureau of Prisons. Thomas has remained in law enforcement custody since his arrest in August 2012.
Thomas pled guilty on Sept. 2, 2014, to one count each of armed bank robbery, felon in possession of a firearm, and brandishing a firearm during a crime of violence for the August 13, 2012 robbery of the SDC Employees Credit Union. According to court documents, Thomas entered the credit union, located at 296 West Jeffery Street, at approximately 12:17 p.m., pointed a chrome revolver at employees and demanded money. After employees placed money into the bag held by Thomas, he fled on foot. A short time later, law enforcement officers arrested Thomas at a residence approximately two blocks north of the credit union.
Thomas was ordered to serve 15 years and 8 months for the armed bank robbery, plus a consecutive seven-year sentence for brandishing a firearm during a crime of violence.
The Kankakee Area Project Safe Neighborhoods Task Force, which includes the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Kankakee Police Department, conducted the case investigation. The FBI also provided assistance in the investigation. Assistant U.S. Attorney Elly M. Peirson prosecuted the case.\Heroin Trafficker Sentenced to 36 Months in Federal PrisonRead the Press Release
PROVIDENCE, R.I. – Pedro Mercado, 32, of Providence, was sentenced today to 36 months in federal prison for possession of heroin with the intent to distribute. Mercado was arrested by Providence Police in February 2014, during an on-going investigation into heroin trafficking in the City of Providence.
At sentencing, U.S. District Court Chief Judge William E. Smith also ordered Mercado to serve 4 years supervised release upon completion of his prison term. Mercado pleaded guilty on May 23, 2014, to possession of heroin with the intent to distribute.
Mercado’s sentence is announced by United States Attorney Peter F. Neronha and Providence Police Chief Colonel Hugh T. Clements, Jr.
According to court documents and information presented to the court, in January and February 2014, Providence Police detectives developed information regarding the drug trafficking activities of Mercado during an investigation into the distribution of heroin in the City of Providence. The investigation included several controlled purchases of heroin from the defendant.
On February 27, 2014, law enforcement executed court authorized search warrants for the defendant’s residence and two vehicles with ties to Mercado. In total, law enforcement seized 154 grams of heroin, $9,660 in cash, assorted items used in the packaging and distribution of heroin, and two firearms.
Receipts seized by law enforcement indicated that the firearms were legally purchased by the defendant.
The case was prosecuted by Assistant U.S. Attorney Pamela E. Chin.
Providence Police were assisted by the Rhode Island DEA Drug Task Force and the Bureau of Alcohol, Tobacco, Firearms and Explosives.###
To assist the media and the public, a glossary of federal judicial terms and procedures is available at http://www.justice.gov/usao/justice101/
Contact: 401-709-5357
[email protected]Government Intervenes in Lawsuit Against Florida Cardiologist Alleging Unnecessary Peripheral Artery Interventions and Payment of KickbacksRead the Press Release
The government has intervened in two lawsuits against a Florida cardiologist, Dr. Asad Qamar, and his physician group, the Institute for Cardiovascular Excellence PLLC (ICE), alleging that Qamar and ICE billed Medicare for medically unnecessary peripheral artery interventions and paid kickbacks to patients by waiving Medicare copayments irrespective of financial hardship, the Justice Department announced today.
“Performing medically unnecessary procedures puts patients at risk and contributes to the soaring costs of health care,” said Acting Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division. “Today’s action evidences the Department of Justice’s efforts both to safeguard federal health care program beneficiaries and to protect public funds.”
The lawsuits allege that Qamar and ICE performed excessive and medically unnecessary peripheral artery interventional services and affiliated procedures on Medicare patients. One of the lawsuits further alleges that Qamar induced patients to undergo those unnecessary procedures by routinely waiving the 20 percent Medicare copayment, regardless of the patients’ financial need.
“Physicians should make medical decisions on the basis of their patients’ needs,” said U.S. Attorney A. Lee Bentley III for the Middle District of Florida. “Performing medically unnecessary procedures solely to line a physician’s pockets strains our nation’s health care system, and can also jeopardize the health and safety of patients. Fighting Medicare and other health care fraud is one of our office’s most important priorities.”
The lawsuits were filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government when they discover evidence that defendants have submitted false claims for government funds and to receive a share of any recovery. The False Claims Act also permits the government to intervene in such lawsuits, as it has done in these cases. The cases are captioned United States ex rel. Doe v. Institute of Cardiovasular Excellence, PLLC, ICE Holdings, PLLC, Dr. Asad Qamar, & Dr. Humera Qamar, Case No. 5:11-CV-406-OC-KRS (M.D. Fla.) and United States ex rel. Taylor & the State of Florida v. Institute of Cardiovascular Excellence & Dr. Asad Qamar, Case No. 8:14-CV-1454-T-35-EAS (M.D. Fla.)
“Physicians who try to enrich themselves and their practices by performing medically unnecessary, invasive procedures can cause patients very serious health issues, waste millions in taxpayer dollars each year, and undercut the public’s trust in the medical profession,” said Special Agent in Charge Derrick L. Jackson of the U.S. Department of Health and Human Services-Office of Inspector General (HHS-OIG). “We will continue to work with our law enforcement partners to protect beneficiaries and hold health care providers accountable for such outrageous fraud schemes.”
This matter illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $23.3 billion through False Claims Act cases, with more than $14.9 billion of that amount recovered in cases involving fraud against federal health care programs.
The investigation was conducted by HHS-OIG, the Civil Division’s Commercial Litigation Branch and the U.S. Attorney’s Office for the Middle District of Florida. The claims asserted by the government are allegations only and there has been no determination of liability.
Four defendants appear in Bluefield federal court on drug chargesRead the Press Release
Two sentenced, two plead guilty
Bluefield, W.Va. – United States Attorney Booth Goodwin announced today that four defendants appeared before Senior United States District Judge David A. Faber in federal court in Bluefield on drug charges.
David Eldon Williams, 56, of Lewisburg, West Virginia, was sentenced to 18 months in prison for using a communication device to facilitate a felony. Williams pleaded guilty in August 2014, admitting that on April 25, 2014, he used a telephone in Lewisburg to communicate with a confidential informant to set up the purchase of several hundred oxycodone pills. Williams and his co-defendant, Roger Lee Deem, were arrested the next day in Princeton, West Virginia, after meeting with the informant to complete the transaction. Deem was previously sentenced to 18 months for his role in the crime.
The case was investigated by the Greenbrier Valley Drug and Violent Crime Task Force as part of the Greenbrier Valley Heroin and Pill Initiative. Assisting in the investigation was the Southern Regional Drug and Violent Crime Task Force.
Tashaey Mitchell Jones, 25, of Hickory, North Carolina, was sentenced to 16 months in prison for aiding and abetting the distribution of hydromorphone. Jones pleaded guilty in October 2014, and admitted that on May 7, 2013, she helped to distribute five hydromorphone pills to an informant in Bluefield.
The case was investigated by the Southern Regional Drug and Violent Crime Task Force as part of the Bluefield Pill Initiative.
Julie Walters, 36, of Bluefield, pleaded guilty to distribution of a quantity of hydromorphone. Walters admitted that on May 29, 2014, she distributed a hydromorphone pill to a confidential informant in Brushfork in Mercer County, West Virginia. She also admitted that she had sold approximately 13 hydromorphone pills over a period of time.
Walters faces up to 20 years in prison and a $1,000,000 fine when she is sentenced on May 14, 2015.
The case was investigated by the Southern Regional Drug and Violent Crime Task Force as part of the Bluefield Pill Initiative.
Regina Conley, 33, of Princeton, pled guilty to distribution of oxycodone, admitting that on August 27, 2014, she distributed six 30 mg oxycodone pills to a confidential informant in Princeton. She also admitted that she either sold or possessed for sale a total of about 55 oxycodone pills.
Conley faces up to 20 years in prison and a $1,000,000 fine when she is sentenced on May 14, 2015.
The case was investigated by the Greenbrier Valley Drug and Violent Crime Task Force, assisted by the Southern Regional Drug and Violent Crime Task Force. It was prosecuted as part of the Greenbrier Valley Heroin and Pill and Initiative.
Assistant United States Attorney John File handled the prosecution of these cases.
The cases are 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. The U.S. 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 in communities across the Southern District.
Former Rockaway Township School Superintendent Pleads Guilty to Attempted Witness TamperingRead the Press Release
NEWARK, N.J. – The former Rockaway Township superintendent of schools today admitted instructing a witness to lie to the FBI about $4,000 that the witness had previously given to him, U.S. Attorney Paul J. Fishman announced.
Gary Vitta, 63, of Denville, New Jersey, pleaded guilty before U.S. District Judge Stanley R. Chesler to an information charging him with one count of attempted witness tampering.
According to the documents filed in this case and statements made in court:
Vitta was the superintendent of the Rockaway Township School District from 2006 to 2011. He dealt with brokers who provided insurance brokerage services to the district and were paid a commission for the insurance contracts they negotiated. At a Vitta family event, Vitta accepted approximately $4,000 in cash from three of the brokers who had provided insurance brokerage services. Shortly after accepting the $4,000, Vitta returned the $4,000 to one of the insurance brokers. Then, in December 2013, Vitta again accepted the $4,000 from the same insurance broker to whom he had returned it.
After accepting the $4,000, Vitta was interviewed by law enforcement agents with the FBI about any benefits that he may have received from insurance brokers who provided brokerage services to the school district. Vitta failed to mention the $4,000 that he had recently received from an insurance broker, or the $4,000 that he had previously received from three insurance brokers at a family event. Following the interview, Vitta contacted the insurance broker who had repaid him the $4,000 in December 2013. He met the insurance broker at a restaurant in Denville, New Jersey, where they first discussed whether the broker was wearing a wire. Vitta told broker that he had recently been approached by FBI agents. He handed the broker a note instructing the broker to lie to the FBI about the $4,000 that the broker had given to him in December 2013. He instructed the broker to lie about the $4,000 that Vitta had previously received at a family event. He also confirmed to this broker that one of the other insurance brokers who had paid him money at that family event also would lie to the FBI if questioned about that payment.
The witness tampering charge to which Vitta pleaded guilty carries a maximum potential penalty of 20 years in prison and a maximum fine of $250,000. Sentencing is scheduled for April 22, 2015.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorneys Rahul Agarwal and Lee M. Cortes Jr. of the U.S. Attorney’s Office Special Prosecutions Division in Newark.
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Defense counsel: Henry E. Klingeman Esq., NewarkFormer CFO Heads to Prison for Failing to Pay Employment TaxesRead the Press Release
HOUSTON – Lanny C. McCandles has been ordered to federal prison after pleading guilty to failing to pay employment taxes, announced U.S. Attorney Kenneth Magidson along with Lucy Cruz, special agent in charge of Internal Revenue Service-Criminal Investigation (IRS-CI).
Today, U.S. District Judge Kenneth Hoyt, who accepted the guilty plea, handed McCandles an 18-month sentence to be immediately followed by three years of supervised release. At the hearing, additional evidence/testimony was presented indicating McCandles had prepared tax returns for several people and had defrauded them by, among other things, taking their refunds. He was further ordered to pay $262,791.28 in restitution.
At the time of his plea Sept. 2, 2014, McCandles admitted that between 2008 and 2011, he embezzled funds withheld from employee paychecks rather than paying them to the IRS as required. He also admitted to attaching fabricated and false IRS W-2 forms to his individual income tax returns as well as returns he prepared and filed on behalf of his girlfriend.
McCandles became the Chief Financial Officer (CFO) of the medical supply company Complete Care Medical Inc. (CCMI) in January 2007. As CFO, he was tasked with keeping CCMI’s books, handling its payroll and preparing and filing its corporate tax returns.
CCMI withheld appropriate federal income, Medicare and Social Security taxes from the paychecks of its approximately 30 employees pursuant to federal law. McCandles was responsible for depositing the withheld taxes to the IRS and filing an Employer’s Quarterly Tax Return (Form 941), which sets forth the total amount of wages and compensation subject to withholding, the total amount of Medicare and Social Security taxes due and the total tax deposits.
Beginning with the quarter ending in March 2008 and continuing through March 2010, McCandles did not deposit these taxes with the IRS nor did he file CCMI’s quarterly tax returns. Instead, he admitted he embezzled the funds CCMI withheld from employee paychecks and used them to pay personal expenses. To carry out and conceal his scheme, McCandles prepared a bi-weekly spreadsheet listing employee payroll expenses for the head of CCMI who then transferred funds to McCandles to cover employee paychecks and withholding. McCandles also prepared the quarterly tax returns and presented them for the signature of CCMI’s head. However, he never filed them.
McCandles admitted he stole the funds earmarked for CCMI’s employment taxes and spent them personally.
Specifically, McCandles pleaded guilty to willfully failing to truthfully account for and pay the IRS approximately $13,624.86 in federal income and FICA taxes withheld from taxable wages of CCMI employees for the first quarter of 2008.
Furthermore, as part of the plea agreement, McCandles admitted he fabricated W-2 Forms and attached them to his personal income tax returns for tax years 2007, 2008 and 2009, resulting in the receipt of refunds to which he was not entitled. For tax years 2007 - 2010, he also admitted to fabricating W-2 Forms and attaching them to tax returns he prepared and filed on behalf of his girlfriend.
McCandles was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.
The charges are the result of an investigation by IRS-CI and the Treasury Inspector General for Tax Administration. Assistant U.S. Attorney Stephen L. Corso prosecuted the case.
Former Bellingham Financial Adviser Sentenced to Prison for Wire Fraud Involving Theft from Elderly ClientsRead the Press Release
A long-time tax and financial adviser in Bellingham, Washington was sentenced today to 51 months in prison, three years of supervised release and $251,892 in restitution for wire fraud, announced Acting U.S. Attorney Annette L. Hayes. JEFFREY M. KNUTSEN, 43, owned and operated Bellwether Financial Services dba Bellwether Wealth Management. In July 2005, KNUTSEN was barred by the Financial Industry Regulatory Authority (“FINRA”) from associating with any broker-dealer as a stock broker because of a customer complaint that KNUTSEN had embezzled from the client’s account. FINRA is an industry organization which regulates financial brokers and brokerage firms. Despite being barred, KNUTSEN continued to work with clients – many of them elderly – and now has been convicted of stealing more than $255,000 from 26 client accounts. At sentencing U.S. District Judge James L. Robart noted that KNUTSEN had continued a career of misappropriating money saying, “This is a crime of greed -- pure unadulterated greed – plain and simple.”
“This fraud damaged the elderly victims emotionally as well as financially,” said Acting U.S. Attorney Annette L. Hayes. “They trusted Jeffrey Knutsen to honestly invest their savings so they could enjoy a secure retirement. Now they are betrayed and wary as they try to safeguard any savings they have left.”
According to records filed in the case, after being barred by FINRA, KNUTSEN did not tell his clients that he had been barred, but instead told them he was moving to a different online brokerage to reduce the fees they would have to pay. He set up online accounts with TD Ameritrade and later E*Trade in his clients’ names and retained full access and control over the accounts, including check-writing privileges. He told the clients he would charge them a management fee of one percent or less per year to manage their accounts. However over seven and a half years he caused the online broker/dealers to issue more than 200 checks for more than $250,000 without the authorization or knowledge of his clients. KNUTSEN then deposited the checks in his account and used the money for his personal gain. Many of the victims were elderly and had little understanding of online brokerage accounts.
The Financial Industry Regulatory Authority (“FINRA”) has online resources to allow clients to check on their financial advisor’s disciplinary history here. The BrokerCheck website
is a free tool that FINRA has set up to help investors research the professional backgrounds of current and former FINRA-registered brokerage firms and brokers, as well as investment adviser firms and representatives.The case was investigated by the FBI and Bellingham Police Department. The case was prosecuted by Assistant United States Attorneys Steven Masada and Justin Arnold.
Former Banker in Great Bend Indicted on Embezzlement ChargesRead the Press Release
WICHITA, KAN. - A former banker from Great Bend appeared in federal court in Wichita Monday on charges including embezzlement, money laundering and making false entries in bank records, U.S. Attorney Barry Grissom said.
Brian W. Harrison, 55, Great Bend, Kan., is charged with three counts of making false entries in bank records, 16 counts of falsifying loan and credit applications, two counts of embezzlement, and two counts of money laundering.
The indictment, which was unsealed today, alleges the crimes occurred while Harrison was a vice president and loan officer at Farmers Bank & Trust in Great Bend. The indictment alleges Harrison made false statements to Farmers Bank to hide the poor performance of loans he made, approved and maintained. The false statements served to deflect questions from Farmers Bank about the performance of Harrison’s portfolio. The indictment alleges Harrison:
- Falsified credit and loan applications without authority of the borrower.
- Obtained loans based on false statements.
- Refinanced or consolidated loans to hide problems with loan repayments.
- Authorized loans in the name of a borrower without the borrower’s authority.
- Instructed a borrower to dispose of loan collateral in a way that damaged Farmers Bank.
According to the United States Treasury Department’s Troubled Asset Relief Program, on June 19, 2009, Farmers Enterprises, Inc., the holding company for Farmers Bank, received $12 million in TARP funding under the Capital Purchase Program. On Nov. 13, 2013, Farmers Enterprises, Inc., paid $11,439,252 to redeem the original funding of $12 million, resulting in a shortfall to the program of $560,748.
“Harrison’s purported scheme resulted in losses for Farmers Bank, and ultimately, federal taxpayers suffered a $560,000 loss on their TARP investment in the bank,” said Christy Romero, Special Inspector General for TARP (SIGTARP).
Upon conviction, the crimes carry the following penalties:
- Making false bank entries: A maximum penalty of 30 years on each count and a fine up to $1 million.
- Making false statements on loan and credit applications: A maximum penalty of 30 years on each count and a fine up to $1 million.
- Embezzlement: A maximum penalty of 30 years on each count and a fine up to $1 million.
- Money laundering: A maximum penalty of 20 years and a fine up to $500,000 on each count.
The FBI and the Special Inspector General for TARP (SIGTARP) investigated. Assistant U.S. Attorney Aaron Smith is prosecuting.
Former Acting HHS Cyber Security Director Sentenced to 25 Years in Prison for Engaging in Child Pornography EnterpriseRead the Press Release
Five Others Previously Sentenced to Substantial Prison Terms for Participation in the Same Tor-Network-Based Child Pornography Website
The former acting director of cyber security at the U.S. Department of Health and Human Services was sentenced to 25 years in federal prison today for engaging in a child exploitation enterprise and related charges in connection with his membership in a Tor-network-based child pornography website.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Deborah R. Gilg of the District of Nebraska and Special Agent in Charge Thomas R. Metz of the FBI’s Omaha Division made the announcement.
“Using the same technological expertise he employed as Acting Director of Cyber Security at HHS, DeFoggi attempted to sexually exploit children and traffic in child pornography through an anonymous computer network of child predators,” said Assistant Attorney General Caldwell. “But dangerous criminals cannot be allowed to operate on-line with impunity. Today’s sentence shows that the Department of Justice will bring criminals and child predators to justice, even when they employ anonymous networks like Tor.”
“Today's sentence and the others imposed earlier demonstrate that those who exploit children will be aggressively pursued and prosecuted to the full extent of the law,” said U.S. Attorney Gilg. “Those who think they are acting anonymously on the Internet will be found and held accountable.”
“The production and distribution of child pornography is one of the most saddening, tragic crimes the FBI investigates,” said Special Agent in Charge Metz. “Today’s sentencing sends a message to those who advertise, distribute, possess, and trade child pornography that the FBI will look for you, will find you and will make sure you are prosecuted to the fullest extent of the law.”
Timothy DeFoggi, 56, formerly of Germantown, Maryland, was convicted on Aug. 26, 2014, following a four-day jury trial before Chief U.S. District Judge Laurie Smith Camp in the District of Nebraska of engaging in a child exploitation enterprise, conspiracy to advertise and distribute child pornography and accessing a computer with intent to view child pornography.
According to evidence presented at trial, DeFoggi registered as a member of the Tor-network-based child pornography website on March 2, 2012, and maintained his membership and activity until Dec. 8, 2012, when the website was taken down by the FBI. The website’s users utilized advanced technological means in order to undermine law enforcement’s attempts to identify them. The website was accessible only through Tor, an Internet application specifically designed to facilitate anonymous communication. Acting under the cloak of anonymity, users advised others on best practices to prevent detection by law enforcement, including advice about the proper use of encryption software, techniques to hide or password-protect child pornography collections, and programs to remove data from a user’s computer.
Through the website, DeFoggi accessed child pornography, solicited child pornography from other members, and exchanged private messages with other members in which he expressed an interest in the violent rape and murder of children. DeFoggi suggested meeting one member in person to fulfill their mutual fantasies to violently rape and murder children.
DeFoggi was the sixth individual to be convicted as part of an ongoing investigation targeting three Tor-network-based child pornography websites. The websites were run by a single administrator, Aaron McGrath, who was previously convicted in the District of Nebraska of engaging in a child exploitation enterprise in connection with his administration of the websites. On Jan. 31, 2014, McGrath was sentenced to 20 years in prison by Senior U.S. District Judge Joseph F. Bataillon.
Four other members of the same website as DeFoggi were previously convicted and sentenced by Senior U.S. District Judge Bataillon in connection with their illegal activity on the site:
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Jason Flanary, then 42, formerly of Chicago, Illinois, the Philippines, and Guam, was sentenced to 20 years in prison on June 30, 2014.
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Wesley Cameron, then 22, formerly of Ashford, Alabama, was sentenced to 15 years in prison on Oct. 24, 2014.
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Zackary Austin, 28, formerly of Reno, Nevada, was sentenced to 16 years in prison on Nov. 6, 2014.
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Charles MacMillan, 29, formerly of Rockville, Maryland, was sentenced to 12 years in prison on Nov. 7, 2014.
These cases were brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case is a result of investigative efforts led by the FBI’s Omaha Field Office and the FBI’s Violent Crimes against Children Section, Major Case Coordination Unit, and Digital Analysis and Research Center. The FBI was assisted in its investigation by Europol, the European Union’s law enforcement agency, as well as members of the FBI’s Violent Crimes Against Children International Task Force. This case was prosecuted by Trial Attorneys Keith Becker and Sarah Chang of CEOS and Assistant U.S. Attorney Michael P. Norris of the District of Nebraska.
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For-Profit College Kaplan to Refund Federal Financial Aid Under Settlement with United StatesRead the Press Release
Over $1 Million will be paid in the form of tuition refunds for 289 students
Kaplan Higher Education (“Kaplan”), a leading for-profit education company with campuses located throughout the country, will pay roughly $1.3 million under a civil settlement with the United States Department of Justice. The settlement resolves whistleblower allegations that the company employed unqualified instructors at its campuses in Texas, Acting U.S. Attorney Richard L. Durbin, Jr. announced today.
Kaplan operates for-profit colleges on several campuses in Texas, including Kaplan College – San Antonio (San Pedro) and Kaplan College – San Antonio (Ingram). These campuses offer a mix of degree and diploma programs, such as a Medical Assistant Diploma program designed to train students for entry-level positions in the health care field. Many of Kaplan’s students receive financial assistance under federal programs that help eligible students obtain higher education. These federal programs, authorized under Title IV of the Higher Education Act of 1965 (“Title IV”), include the Federal Pell Grant Program, Federal Direct Loan Program, and Federal Family Education Loan Program, among others.
The Department of Justice began investigating Kaplan after a whistleblower, Leslie Coleman, filed a qui tam lawsuit under the False Claims Act accusing Kaplan of employing unqualified instructors to teach Medical Assistant courses at its San Antonio campuses. The suit alleged that Kaplan knowingly requested, received, and retained federal tuition funds for courses taught by individuals who did not meet the minimum requirements established by Texas law. Following the United States’ investigation, the parties negotiated a settlement pursuant to which Kaplan will pay $1,329,753.25 to resolve the whistleblower claims. The majority of the settlement – roughly $1,077,000 – will be paid in the form of tuition refunds. These refunds will benefit 289 students, whose student loan debt will decrease as a result of the settlement.
Kaplan fully cooperated with the government’s investigation and negotiated the settlement in good faith, stated Acting U.S. Attorney Durbin. The settlement is not an admission of liability by Kaplan or its affiliates.
The Department of Education Office of Inspector General (DOE-OIG) and the U.S. Attorney’s Office for the Western District of Texas investigated the allegations raised in the whistleblower suit captioned United States ex rel. Leslie Coleman v. Kaplan, Inc., The Washington Post Company, Kaplan Higher Education Corporation, Kaplan College – San Antonio (San Pedro) and Kaplan College – San Antonio (Ingram), no. SA:12-cv-0459-FB (W.D. Tex.) DOE-OIG Special Agent Edd Cole, Assistant U.S. Attorney John J. LoCurto, and ACE Auditor Jamie Cole, CPA handled the investigation for the Government.
Individuals who suspect Title IV fraud, waste, or abuse are encouraged to report their information to the Department of Education by calling the Inspector General’s fraud hotline at 1-800-MIS-USED.
Federal Correctional Officer Sentenced for Accepting Bribes and Providing Contraband to InmatesRead the Press Release
ABINGDON, VIRGINIA – Acting United States Attorney Anthony P. Giorno announced today that Scottie Austin was sentenced in the United States District Court for the Western District of Virginia in Abingdon on charges of receiving bribes.
Scottie Austin, 44, of Kingsport, Tenn., who at the time of his offenses worked as a correctional officer at United States Penitentiary Lee County, previously pled guilty to a one count Information charging him with accepting a bribe as a public official. Today in District Court, Austin was sentenced to 12 months and one day of federal incarceration.
“Mr. Austin betrayed the trust placed in him by the Department of Corrections through his illegal and potentially dangerous activity,” Acting United States Attorney Anthony P. Giorno said today. “The investigation and prosecution of this case shows that our office and our investigative partners will pursue justice no matter the position of the individual who breaks federal law.”
According to evidence presented at the guilty plea and sentencing hearings by Assistant United States Attorney Zachary T. Lee, Austin was employed as a correctional officer for the United States Bureau of Prisons at United States Penitentiary Lee County, Virginia, in Jonesville, Va. Between April 2013 and April 2014, Austin received multiple monetary payments, totaling at least $10,000, from family members of an inmate at the penitentiary in return for Austin smuggling tobacco products and cellular telephones into the penitentiary. These items were then provided to the inmate in violation of Bureau of Prisons regulations.
The investigation of this case was conducted by the Federal Bureau of Investigation, United States Bureau of Prisons Special Investigative Service at United States Penitentiary Lee County, and the United States Department of Justice Office of the Inspector General. Assistant United States Attorney Zachary T. Lee prosecuted the case for the United States.
District Man Sentenced to 36 Years in Prison for Shooting That Killed Two Victims, Injured AnotherDefendant Shot Victims Inside Car Off North Capitol StreetRead the Press Release
WASHINGTON – Jimmie Fleming, 36, of Washington, D.C., was sentenced today to 36 years in prison on charges stemming from a shooting in which two people were killed and another was wounded, U.S. Attorney Ronald C. Machen Jr. announced.
Fleming pled guilty in September 2014, in the Superior Court of the District of Columbia, to two counts of voluntary manslaughter while armed for the deaths of Donchell Thomas and Derek Price, and one count of aggravated assault while armed, for the shooting of the third victim. The plea, which was contingent upon the Court’s approval, called for a prison term of 36 years. The Honorable Robert E. Morin accepted the plea and sentenced Fleming accordingly. Upon completion of his prison term, Fleming is to be placed on five years of supervised release.
According to the government’s evidence, on July 13, 2014, at about 1 a.m., Fleming and a juvenile approached a blue Honda Accord near North Capitol and T Streets NW. Mr. Price, 20, was the driver of the car, and Mr. Thomas, 21, was in the back seat. A second passenger was in the front seat. Mr. Price agreed to drive Fleming and the juvenile down the street.
Fleming and the juvenile entered the back seat, joining Mr. Thomas. As Mr. Price drove the car, Fleming pulled out a gun and fired it at all of the occupants inside the car. This shooting was unprovoked and without any warning. Mr. Price and Mr. Thomas were both shot in the head and died from their respective injuries. The front seat passenger, who survived the incident, was shot multiple times in his torso and arm. The juvenile was not hit by the gunfire.
Due to the shooting, the car crashed at the intersection of North Capitol and T Streets. Fleming fled from the car on foot and ultimately ran to a nearby house, where he was arrested by the Metropolitan Police Department. A search of the home was conducted later that morning. Among other things, the police found a bag of ammunition in the defendant’s room.
In announcing the sentence, U.S. Attorney Machen commended the work of the detectives of the Criminal Investigations Division, crime scene officers, and the Fifth Police District of the Metropolitan Police Department. He also expressed appreciation to those who worked on the case from the U.S. Attorney’s Office, including Victim/Witness Advocate Veronica Vaughn and Paralegal Specialist Fern Rhedrick. He also praised the efforts of Assistant U.S. Attorney Shana L. Fulton, who prosecuted the case.
15-002District Man Pleads Guilty to Possession of Child PornographyOver 3,000 Images and 267 Videos Seized in Search of Defendant’s ResidenceRead the Press Release
WASHINGTON – Michael Centanni, 48, of Washington, D.C., pled guilty today to a federal charge of possession of child pornography, announced U.S. Attorney Ronald C. Machen Jr. and Clark E. Settles, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), Washington, D.C.
Centanni entered the plea in the U.S. District Court for the District of Columbia. He is to be sentenced on April 9, 2015 by the Honorable Senior Judge Thomas F. Hogan. The charge carries a statutory maximum of 20 years in prison and potential financial penalties. He also will be required to register as a sex offender for a minimum period of 15 years.
Centanni was arrested on Oct. 30, 2014 following an investigation by HSI. According to a statement of offense signed by the defendant as well as the government, the investigation determined that Centanni had been using the Internet to obtain child pornography files.
Law enforcement searched Centanni’s residence on Oct. 14, 2014 and seized hard drives and other electronic media. A subsequent examination identified more than 3,000 images and 267 videos depicting child pornography. Centanni has been in custody since his arrest. In an interview with law enforcement, he admitted obtaining images and videos depicting child pornography and storing it on the electronic devices seized during the search.
In announcing the plea, U.S. Attorney Machen and Special Agent in Charge Settles commended the work of the HSI Special Agents who investigated the case and expressed appreciation for the assistance of the Metropolitan Police Department (MPD). They also expressed appreciation for the efforts of Assistant U.S. Attorney Cassidy Kesler Pinegar, who prosecuted the case, and Assistant U.S. Attorney Ari Redbord, who assisted in the investigation.
15-003Dickinson County Man Ordered to Pay Back Stolen Railroad Union FundsRead the Press Release
TOPEKA, KAN. - A former secretary-treasurer of a railroad union was sentenced Monday to time served and two years on supervised release for embezzling union funds, U.S. Attorney Barry Grissom said. He also was ordered to pay more than $17,000 in restitution to the union.
Dale T. Hull, 63, Herington, Kan., pleaded guilty to one count of embezzling union funds. In his plea, Hull admitted the crime occurred while he was secretary-treasurer of the Brotherhood of Locomotive Engineers and Trainmen, Division 261, which represented employees of the Union Pacific Railroad who work in the Herington, Kan., terminal and the Salina, Kan., hub.
Starting in 2008, Hull made unauthorized and illegal account transfers from the union’s account to his personal checking account totaling more than $17,000. He also filed false reports to the U.S. Department of Labor in which he understated his earnings as secretary-treasurer of the union.
Grissom commended the U.S. Department of Labor – Office of Inspector General and Assistant U.S. Attorney Richard Hathaway for their work on the case.
College Park Tax Preparer Sentenced to 5 Years in Prison for Scheme to Obtain Fraudulent Refunds for Temporary WorkersRead the Press Release
Also Used the Personal Information of Former Clients to Falsely Claim Them as Dependents on Current Clients’ Returns
Greenbelt, Maryland – U.S. District Judge Paul W. Grimm sentenced Julius Valentine Williams, age 61, of College Park, Maryland today to five years in prison, followed by three years of supervised release, for aiding and assisting in filing false tax returns, filing false tax returns, wire fraud and aggravated identity theft. Judge Grimm entered an order requiring Williams to pay restitution of $1 million.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Thomas J. Kelly of the Internal Revenue Service - Criminal Investigation, Washington, D.C. Field Office.“In preparing tax returns for his clients, Julius Valentine Williams added false deductions, expenses and credits to wipe out their tax liabilities and in many cases to claim fraudulent tax credits, so the IRS paid out tax revenue instead of collecting it,” said U.S. Attorney Rod J. Rosenstein. “Mr. Williams also filed fraudulent tax returns in his own name in his scheme to rip off the taxpayers.”
“While most tax return preparers provide excellent service to their clients, a few dishonest return preparers give the industry a black eye. IRS-CI works year round to investigate dishonest return preparers and protect the American taxpayer’s money,” said Thomas J. Kelly, Special Agent in Charge, IRS Criminal Investigation, Washington D.C. Field Office. “Return preparers must comply with the same tax obligations as the clients that they serve. No one is above the law.”
According to his plea agreement, Williams was a tax return preparer who owned and operated Julius Williams Tax Service out of his home in College Park. During tax years 2007 through 2010, William prepared and submitted to the IRS more than 5,000 client individual tax returns. Many of Williams’ clients were from Jamaica and resided in the United States under a temporary worker program. At the end of their employment, they were required to return to their home countries. Williams admitted that when preparing tax returns for these clients, he added false items, such as false Schedule C businesses, false deductions, false Earned Income tax credits, and false education credits, in order to fraudulently increase the size of the refund to the client.
In addition, Williams kept detailed lists of identification information of former clients who had returned to their home countries, including names, social security numbers and dates of birth. Williams then used that identification information, without the former clients’ knowledge or permission, to claim them as dependents on the income tax returns of current clients, in order to fraudulently increase the refunds on those returns.
Williams also filed false personal tax returns for tax years 2007 through 2010, in which Williams underreported his income from his tax business by a total of more than $1 million. As a result, the tax loss to the government was approximately $411,056, for those years. Williams also used the personal identification information of his former clients to fraudulently claim them as dependents on his personal income tax returns, which increased his refund and resulted in additional the taxes owed to the government.
As a result of the fraudulent tax returns prepared by Williams for his clients, and his own fraudulent returns, the total tax loss to the government is at least $1 million.
United States Attorney Rod J. Rosenstein praised the IRS-CI for its work in the investigation and thanked Assistant U.S. Attorneys Kelly O. Hayes and Sean R. Delaney, who prosecuted the case.Chiropractor Sentenced in Health Care Fraud CaseRead the Press Release
FORT WORTH, Texas — A local chiropractor, who was convicted at trial on felony offenses stemming from his involvement in a health care fraud case, was sentenced this morning, announced John R. Parker, Acting U.S. Attorney for the Northern District of Texas.
Dr. Abbas Zahedi, 49, of Carrollton, Texas, was sentenced by U.S. District Judge Reed C. O’Connor to serve 145 months in federal prison and ordered to pay approximately $2.4 million in restitution. He was convicted at trial in June 2014 on all counts of a superseding indictment charging one count of conspiracy to commit health care fraud, five counts of health care fraud and four counts of aggravated identity theft. Dr. Zahedi, who has been in custody since his conviction, owned and operated DFW Rehab & Diagnostics.
Five other defendants convicted in the case have also been sentenced.
Reginald Guy, 44, of Arlington, Texas, was sentenced to serve 156 months in federal prison and ordered to pay approximately $2.4 million in restitution. He was convicted at trial on the same offenses as Dr. Zahedi. Guy was a factory worker in Arlington, and from approximately 2003 until November 2009, when his employment was terminated, he served as a union representative.
Guy used that union position to recruit and refer his co-workers to DFW Rehab & Diagnostics, which was operated from the office of Metroplex DFW Sports Rehab Center in Arlington, and then later from a stand-alone location in Grand Prairie, Texas. In exchange for monthly kickbacks, work excuse notes and a variety of prizes, the workers agreed to allow their insurance companies to be billed for services they did not receive.
From 2009 to 2012, Dr. Zahedi, Guy, and their four codefendants conspired to submit health insurance claims to Blue Cross Blue Shield of Texas (BCBS) and other insurers for services not rendered. These four coconspirators, James Sterns, Tina Perkins, Donna Harris and Gregory Wattron, cooperated with the government in the investigation and testified against Zahedi and Guy at their trial.
Sterns, 50, of DeSoto, Texas, was sentenced to 10 months in federal prison and ordered to pay approximately $2.2 million in restitution. Sterns owned and operated Metroplex. In early 2010, Sterns hired Guy to be the office manager of Metroplex, where he worked in that position to mid-2011, shortly before the clinic closed. In March or April 2011, Dr. Zahedi hired Guy to work as a consultant at the clinic’s Grand Prairie location. After Guy began working for Dr. Zahedi, Guy helped transfer patients and patient information to Dr. Zahedi, and the fraudulent referral and billing scheme continued.
Perkins, 43, of Dallas, was sentenced to 10 months in federal prison and was ordered to pay approximately $2.4 million in restitution. Perkins worked as the biller and office consultant for Dr. Zahedi and was responsible for submitting claims to insurance companies.
Perkins’ sister-in-law, Donna Harris, 43 of Haltom City, Texas, was sentenced to eight months in federal prison and was ordered to pay approximately $2 million in restitution. Harris permitted the clinic, in exchange for cash payments, to submit claims to BCBS for services purportedly performed by Dr. Zahedi and Wattron, when in fact she received no treatment. Then, in early 2011, Dr. Zahedi hired Harris to be the office manager at the Grand Prairie location. There, she continued to allow Dr. Zahedi to submit claims under her name to BCBS for services that were not performed. Harris also permitted Dr. Zahedi to submit claims to BCBS for Harris’ immediate and extended family members for services they did not receive.
Wattron, 56, of Grapevine, Texas, was sentenced to six months in federal prison and was ordered to pay approximately $1.3 million in restitution. He worked as an occupational therapist at the clinic from approximately 2008 until August 2011. Wattron agreed to allow Sterns and Dr. Zahedi bill insurance companies for occupational therapy that he did not perform.
The FBI and the Office of Personnel Management - Office of Inspector General investigated. Assistant U.S. Attorney Nancy Larson and Special Assistant U.S. Attorney Douglas Brasher prosecuted the case.
Chiropractor Sentenced in Health Care Fraud CaseRead the Press Release
FORT WORTH, Texas — A local chiropractor, who was convicted at trial on felony offenses stemming from his involvement in a health care fraud case, was sentenced this morning, announced John R. Parker, Acting U.S. Attorney for the Northern District of Texas.
Dr. Abbas Zahedi, 49, of Carrollton, Texas, was sentenced by U.S. District Judge Reed C. O’Connor to serve 145 months in federal prison and ordered to pay approximately $2.4 million in restitution. He was convicted at trial in June 2014 on all counts of a superseding indictment charging one count of conspiracy to commit health care fraud, five counts of health care fraud and four counts of aggravated identity theft. Dr. Zahedi, who has been in custody since his conviction, owned and operated DFW Rehab & Diagnostics.
Five other defendants convicted in the case have also been sentenced.
Reginald Guy, 44, of Arlington, Texas, was sentenced to serve 156 months in federal prison and ordered to pay approximately $2.4 million in restitution. He was convicted at trial on the same offenses as Dr. Zahedi. Guy was a factory worker in Arlington, and from approximately 2003 until November 2009, when his employment was terminated, he served as a union representative.
Guy used that union position to recruit and refer his co-workers to DFW Rehab & Diagnostics, which was operated from the office of Metroplex DFW Sports Rehab Center in Arlington, and then later from a stand-alone location in Grand Prairie, Texas. In exchange for monthly kickbacks, work excuse notes and a variety of prizes, the workers agreed to allow their insurance companies to be billed for services they did not receive.
From 2009 to 2012, Dr. Zahedi, Guy, and their four codefendants conspired to submit health insurance claims to Blue Cross Blue Shield of Texas (BCBS) and other insurers for services not rendered. These four coconspirators, James Sterns, Tina Perkins, Donna Harris and Gregory Wattron, cooperated with the government in the investigation and testified against Zahedi and Guy at their trial.
Sterns, 50, of DeSoto, Texas, was sentenced to 10 months in federal prison and ordered to pay approximately $2.2 million in restitution. Sterns owned and operated Metroplex. In early 2010, Sterns hired Guy to be the office manager of Metroplex, where he worked in that position to mid-2011, shortly before the clinic closed. In March or April 2011, Dr. Zahedi hired Guy to work as a consultant at the clinic’s Grand Prairie location. After Guy began working for Dr. Zahedi, Guy helped transfer patients and patient information to Dr. Zahedi, and the fraudulent referral and billing scheme continued.
Perkins, 43, of Dallas, was sentenced to 10 months in federal prison and was ordered to pay approximately $2.4 million in restitution. Perkins worked as the biller and office consultant for Dr. Zahedi and was responsible for submitting claims to insurance companies.
Perkins’ sister-in-law, Donna Harris, 43 of Haltom City, Texas, was sentenced to eight months in federal prison and was ordered to pay approximately $2 million in restitution. Harris permitted the clinic, in exchange for cash payments, to submit claims to BCBS for services purportedly performed by Dr. Zahedi and Wattron, when in fact she received no treatment. Then, in early 2011, Dr. Zahedi hired Harris to be the office manager at the Grand Prairie location. There, she continued to allow Dr. Zahedi to submit claims under her name to BCBS for services that were not performed. Harris also permitted Dr. Zahedi to submit claims to BCBS for Harris’ immediate and extended family members for services they did not receive.
Wattron, 56, of Grapevine, Texas, was sentenced to six months in federal prison and was ordered to pay approximately $1.3 million in restitution. He worked as an occupational therapist at the clinic from approximately 2008 until August 2011. Wattron agreed to allow Sterns and Dr. Zahedi bill insurance companies for occupational therapy that he did not perform.
The FBI and the Office of Personnel Management - Office of Inspector General investigated. Assistant U.S. Attorney Nancy Larson and Special Assistant U.S. Attorney Douglas Brasher prosecuted the case.
Cedar Rapids Man Sentenced to Five Years for Being A Felon in Possession of A Handgun Stolen During BurglaryRead the Press Release
Contact: Steve Young
A man who stole a firearm during the burglary was sentenced today to five years in federal prison. Tanner Williams, age 25, from Cedar Rapids, Iowa, received the prison term after a guilty plea to one count of being a felon in possession of a firearm.
In a plea agreement, Williams admitted he is a felon, having been convicted on April 7, 2014, of Theft 2nd Degree. On May 18, 2014, a Cedar Rapids home was burglarized. Among the property stolen during the burglary was a .22 caliber handgun. Williams pawned the firearm at a Cedar Rapids pawn shop two days after the burglary. Williams later admitted lying to police when he falsely denied committing the burglary and claimed that another person had asked him to pawn the handgun. At the sentencing hearing, the court refused to reduce the sentence for acceptance of responsibility, and further increased the sentence beyond the advisory guidelines range, because of his conduct while on release pending trial. The court had released Williams after his arrest subject to certain conditions. The court found Williams violated those conditions by repeatedly using marijuana and heroin, possessing ammunition as a felon, lying to the probation officers and police, and by possessing a stolen purse.
Williams was sentenced in Cedar Rapids by United States District Court Chief Judge Linda R. Reade. Williams was sentenced to 60 months’ imprisonment. A special assessment of $100 was imposed. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system. Williams is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney C.J. Williams and investigated by the Federal Bureau of Investigation’s Safe Streets Task Force and the Cedar Rapids Police Department.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 14-cr-71.
Buffalo Man Pleads Guilty to Drug ChargeRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
BUFFALO, N.Y.—U.S. Attorney William J. Hochul, Jr. announced today that Anthony Anastasia, 48, of Buffalo, NY, pleaded guilty to possession with intent to distribute cocaine before Chief U.S. District Judge William M. Skretny. The charge carries a maximum penalty of 20 years in prison, a fine of $1,000,000 or both.Assistant U.S Attorney Mary Catherine Baumgarten, who is handling the case, stated that on November 16, 2011, Anastasia was arrested after he admitted that he was selling cocaine. The defendant also admitted to having approximately three ounces of cocaine at his residence at 32 Lovering in Buffalo. As part of the investigation, the cocaine was seized by law enforcement.
The plea is the result of an investigation by Drug Enforcement Administration, under the direction of Special Agent in Charge James J. Hunt, New York Field Office.
Sentencing is scheduled for May 6, 2015 at 9:00 a.m. before Judge Skretny.
Bastrop Tax Preparer Sentenced to 39 Months in Prison for Preparing False Returns, Wire Fraud and Identity TheftRead the Press Release
MONROE, La. – United States Attorney Stephanie A. Finley announced today that a Bastrop tax preparer was sentenced to 39 months in prison for filing fraudulent income tax returns using stolen identities and false information.
Claudia Marie Mays, 41, of Bastrop, La., was sentenced by U.S. District Judge Robert G. James for one count of aiding and assisting in making and subscribing a false tax return, two counts of wire fraud, and two counts of identity theft. She was also ordered to pay $94,043.15 restitution and was sentenced to three years of supervised release. According to evidence presented at the June 17, 2014 guilty plea, Mays prepared fraudulent income tax returns and filed 15 fraudulent tax returns using stolen identities and false information from January 2011 to April 2011. The IRS issued $94,043.15 in fraudulent refunds because of the scheme.
Co-conspirator Carla Inzina, 53, also of Bastrop, assisted Mays in filing one of the fraudulent returns by obtaining another person’s personal information and using it to file a false return without the person’s permission. Inzina was sentenced to three years of probation for one count of aiding and assisting in making and subscribing a false return.
The IRS Criminal Investigation-Shreveport Division conducted the investigation. Assistant U.S. Attorney Seth D. Reeg prosecuted the case.
Saturday 3 January 2015
St. Paul Felon Sentenced for Possessing A .357-revolverRead the Press Release
MINNEAPOLIS—Earlier today in federal court in St. Paul, a 29-year-old St. Paul felon was sentenced for possessing a .357-caliber revolver. United States District Court Judge Susan Richard Nelson sentenced Richard Alonzo Woods to 77 months in prison on one count of being a felon in possession of a firearm. Woods was indicted on May 15, 2012, and pleaded guilty on July 27, 2012.
In his plea agreement, Woods admitted that on November 16, 2011, he possessed the Smith & Wesson revolver. Because he is a felon, Woods is prohibited under federal law from possessing a firearm at any time. His prior convictions – all in Ramsey County-- include third-degree sale of controlled substances (2002 and 2003), check forgery (2003), fifth-degree possession of controlled substances (2006), and possession of a firearm by an ineligible person (2006).
This case was the result of an investigation by the St. Paul Police Department and the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives. It was prosecuted by Assistant U.S. Attorneys Julie E. Allyn and Surya Saxena.