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9 February 2015
Head of Newman drug ring gets 10 years in federal prisonRead the Press Release
HUNTINGTON, W.Va. – United States Attorney Booth Goodwin announced today that Kenneth Dewitt Newman, 32, of Huntington, was sentenced to 10 years in federal prison.
In May 2014, Newman, also known as “K-Kutta,” pleaded guilty to possession of controlled substances with intent to distribute. He also pleaded guilty in October 2014 to possession of a firearm in furtherance of drug trafficking. On Jan. 20, 2014, Drug Enforcement Administration agents conducted a search of Newman’s residence in the 1800 block of Artisan Ave. in Huntington. During the search, agents located and seized cocaine, oxycodone, heroin, MDMA and marijuana, which Newman admitted he intended to sell. He further admitted that from 2010 to 2014, he, with the aid of others, sold drugs from his home, and that he possessed a firearm to help facilitate their distribution.
Newman received five years in federal prison for each charge to which he pleaded guilty, to run consecutively for a total of 10 years.
Newman, his brother George Antonio Newman, their mother Darlene Newman and 12 others were indicted for their various roles in the drug distribution conspiracy. The charges against Newman and his associates arose out of a long-term investigation led by the DEA, Huntington Police Department and Metropolitan Drug Enforcement Network Team.
Chief United States District Judge Robert C. Chambers imposed the sentence.
The Drug Enforcement Administration and Huntington Police Department were in charge of the investigation. Assistant United States Attorney Greg McVey was in charge of the prosecution.
This case is being prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and heroin. The U.S. Attorney’s Office, joined by federal, state and local law enforcement, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
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Harnett County Man Found Guilty of Kidnapping, Use of A Firearm in A Crime of Violence, and Felon in Possession of A FirearmRead the Press Release
WILMINGTON – United States Attorney Thomas G. Walker announced today that a jury convicted BRADLEY CAMPBELL, 23of Harnett County, North Carolina, of kidnapping, use and carrying of a firearm during a crime of violence, and of being a felon in possession of a firearm. The jury returned its verdict following a trial in federal court before United States District Judge James C. Fox.
Following a domestic dispute which had occurred previously in the day, CAMPBELL, in the early morning hours of January 17, 2014, entered the home in Spring Lake, NC he shared with a woman. At the time, the home was occupied by 17-year old and 18 year old males, the woman, her oldest child, and two younger children of both CAMPBELL and the woman. The 18 year old victim was shot by CAMPBELL and held captive; the 17 year old male escaped; and the mother with an infant escaped approximately one hour later. CAMPBELL, after repeated demands to law enforcement that they bring him marijuana, released the shooting victim approximately 5 hours after the violence began. The two additional children were released approximately 2 hours following that. At sentencing, CAMPBELL faces a minimum of ten years and up to life imprisonment.
The events and scene were handled by the Harnett County Sheriff’s Office, and further investigation completed by the Harnett County Sheriff’s Office and the United States Bureau of Alcohol, Tobacco, Firearms, and Explosives. The Cumberland County Sheriff’s Office provided forensic assistance.
Government Intends to Seek Dealth Penalty for Leader of Violent Newark Street GangRead the Press Release
South Side Cartel Leader Charged with Six Murders in Racketeering Indictment
NEWARK, N.J. – U.S. Attorney General Eric Holder has authorized and directed that the death penalty be sought against the leader of a violent Newark street gang charged with six murders, U.S. Attorney Paul J. Fishman announced today.Formal notice of intent to seek the death penalty was presented in court today to Farad Roland, 30, leader of the South Side Cartel gang in Newark. Roland and two-codefendants were previously arraigned on a 24-count superseding indictment charging them with violations of the Racketeer Influenced Corrupt Organizations Act (RICO), murder, kidnapping, robbery, carjacking, drug conspiracy and other violent acts in aid of racketeering and related charges.
Five of the six murders charged in the superseding indictment are death-eligible offenses. Attorney General Holder authorized the U.S. Attorney to seek the death penalty on Jan.12, 2015. The criminal case against Roland and his codefendants is pending before U.S. District Judge Esther Salas, who has scheduled the trial for Jan. 11, 2016. The formal notice was given to Roland today before Judge Salas in Newark federal court.
If convicted of any of the death penalty eligible murders, a separate penalty phase would follow. If the jury found that the death penalty should not be imposed, Farad Roland would be sentenced to life without the possibility of parole. The case would be the second capital case tried in the history of the District of New Jersey, and the first since 2007.Attorney General Holder also authorized and directed the U.S. Attorney not to seek the death penalty against Roland’s codefendants, Mark Williams, 32, and Malik Lowery, 33, who are each charged with one death penalty eligible murder. The defendants were indicted by a federal grand jury and arraigned on Dec. 20, 2012. They are detained without bail.
According to documents filed in this case:
The South Side Cartel, a sub-set of the Bloods street gang, operated primarily on Hawthorne Avenue in Newark since 2002. Originally a neighborhood-based gang whose main activities were selling drugs and committing violent acts to aid the drug trafficking business, many of the gang's members were officially brought into the Bloods gang in 2002 and 2003. As early as 2005, the gang was officially named “The South Side Cartel.” The gang’s center of activities were apartments located inside buildings dubbed “the Twin Towers,” located at 496-500 Hawthorne Avenue, the location of repeated narcotics and gun arrests by local law enforcement between 2002 and 2010. Many of the South Side Cartel members had tattoos showing these buildings and the logo of “SSC” representing the gang’s initials.
At its peak, the South Side Cartel had about 20 members or associates, many of whom have since been killed in gang-related murders or who are serving prison sentences in state and federal prisons for gang-related crimes. These defendants represent the last of the leadership of the gang. Co-founded by Amin and Farad Roland, between 2003 and 2010 the South Side Cartel was generally known among law enforcement and the FBI as the most violent street gang operating in Newark, committing numerous murders, shootings, robberies and other violent acts in furtherance of the enterprise.
The superseding indictment charges the defendants with their participation in a host of racketeering acts to further the South Side Cartel's goals, including: 1) the Dec. 4, 2003, murder of a rival gang member in a drive-by shooting; 2) the Feb. 23, 2005, murder of a fellow South Side Cartel member who was about to be arrested, in order to keep him from cooperating with law enforcement and implicating Farad Roland in a robbery/murder which took place a few days earlier; 3) the Oct. 20, 2007, murder of a fellow South Side Cartel member who had fallen into disfavor with the gang; and 4) the retaliation murders of two people on March 27, 2008, outside the Oasis Bar located on Lyons Avenue in Newark All the victims were shot to death.
The superseding indictment also charges the defendants with carjacking, assault with dangerous weapons in furtherance of racketeering for shootings of rival gang members and a conspiracy to distribute heroin and crack cocaine, among other charges.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Acting Special Agent in Charge Eric Welling; the Newark Police Department, under the direction of Police Director Eugene Venable and Police Chief Anthony Campos; and Acting Essex County Prosecutor Carolyn Murray, with the investigation leading to the charges in this case.The government is represented by Assistant U.S. Attorneys Robert Frazer and Andrew Bruck of the Organized Crime/Gangs Unit in Newark.
15-051
Defense counsel: Farad Roland: Donna Newman, Esq. and Richard Jasper Esq.
Mark Williams: James Patton Esq., and Carl Herman Esq.
Malik Lowery: John Azzarello Esq. and Anthony Ricco, Esq.Four Members of Meth Conspiracy Sentenced to Federal PrisonRead the Press Release
Contact: Steve Young
Three men and one woman who conspired to distribute methamphetamine were sentenced to federal prison.
Three members of the conspiracy from Fort Dodge, Iowa - Robert Ackerman, 36; Shawn Owen, 37; Deidre Schlachter, 45; and Donald Smith, 42, from Huntington Beach, California, all plead guilty to conspiracy to distribute methamphetamine.
At their respective guilty plea hearings, each admitted their involvement in the conspiracy from about January 2009 and continuing through about December 2013 that distributed more than 500 grams of methamphetamine in the Fort Dodge, Iowa, area. Smith made arrangements to ship (mail) methamphetamine from California to Iowa to Owen, Schlachter, and Ackerman in exchange for cash being shipped (mailed) by Owens, Schlachter, and Ackerman to Smith in California. On April 25, 2013, law enforcement seized a Fed-Ex overnight envelope (in transit) from Smith to Schlachter. The Fed-Ex package contained 10.44 grams of 100% pure methamphetamine.
The defendants were sentenced in Sioux City by United States District Court Judge Mark W. Bennett. Ackerman was sentenced to 35 months’ imprisonment; Owen was sentenced to 48 months’ imprisonment; Schlachter was sentenced to 33 months’ imprisonment; and Smith was sentenced to 120 months’ imprisonment. Each must pay a special assessment of $100. Each must also serve a five-year term of supervised release after the prison term. There is no parole in the federal system.
All defendants are being held in the United States Marshal’s custody until they can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Shawn S. Wehde and investigated by the Iowa Department of Narcotics Enforcement, Iowa Division of Criminal Investigation, Fort Dodge Police Department, Webster City Police Department, Webster County Sheriff’s Office, Hamilton County Sheriff’s Office, Hardin County Sheriff’s Office, and Iowa Falls Police Department.
Court file information is available at https://ecf.iand.uscourts.gov. The case file number is 13-3055.
Follow us on Twitter @USAO_NDIA.
Former Salem, Virginia, Police Officer Sentenced to 30 Months in Prison for Soliciting Sexual Favors in Exchange for Potential Lenient TreatmentRead the Press Release
A former police officer employed by the City of Salem, Virginia, and assigned to a U.S. Drug Enforcement Administration (DEA) task force, was sentenced today to 30 months in prison for soliciting and receiving sexual favors from a cooperating defendant in exchange for agreeing to recommend a favorable sentence to a federal prosecutor on the defendant’s behalf.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Special Agent in Charge Adam S. Lee of the FBI’s Richmond Division and Special Agent in Charge Michael Tompkins of the Department of Justice, Office of the Inspector General’s Washington Field Office made the announcement after the sentence was imposed by Chief U.S. District Judge Glen E. Conrad of the Western District of Virginia.
Kevin C. Moore, 42, of Roanoke, Virginia, pleaded guilty on Dec. 16, 2014, to one count of bribery.
According to his plea agreement and accompanying statement of facts, between June and September 2014, while Moore was serving as a DEA task force officer, Moore informed a female cooperating defendant that he was in a position to help her with her pending federal methamphetamine trafficking case. In August 2014, for example, in a series of text messages with the cooperating defendant, Moore made clear that he could recommend a favorable sentence to a prosecutor on the cooperating defendant’s behalf in exchange for sexual favors. Moore then convinced the cooperating defendant to go for a ride in his official vehicle where she performed a sexual act with Moore.
As part of his guilty plea, Moore also admitted to engaging in similar conduct with two other female cooperating witnesses in federal drug investigations dating back to 2009. According to the statement of facts, Moore falsely informed these witnesses that he had convinced federal prosecutors not to charge them with federal criminal offenses that would carry significant prison sentences. Moore then solicited and received sexual favors from the witnesses in exchange for his purported assistance.
Moore was arrested on Oct. 10, 2014, without incident, and was suspended from the police department and DEA task force the same day. Moore was terminated from his employment with the City of Salem Police Department after pleading guilty in this case.
This case was investigated by the FBI and the Justice Department’s Office of the Inspector General, and was prosecuted by Trial Attorneys Charles R. Walsh and Robert J. Heberle of the Criminal Division’s Public Integrity Section.
Former Court Officer for the 36th District CourtCharged with Extortion, Fraud and TheftRead the Press Release
An indictment was unsealed today charging a former court officer for the 36th District Court in Detroit with extortion, mail fraud and theft, announced U.S. Attorney Barbara L. McQuade.
Joining in the announcement was Michigan Attorney General Bill Schuette and Paul M. Abbate, Special Agent in Charge of the Detroit, Michigan office of the Federal Bureau of Investigation.
Marlon Cleveland, 33, of Westland, was charged with misusing his position as a Court Officer for the 36th District Court to steal and extort thousands of dollars from defendants in civil cases over the course of more than a year. The crimes are alleged to have occurred in 2013 and 2014.
McQuade stated, “Anyone who abuses a position of trust to steal from our courts or to extort money from members of the public should expect to face serious penalties under the law.”
“We must weed out corruption at all levels of government to ensure the public is served,” said Michigan Attorney General Bill Schuette. “Nobody will get a free pass when they break the law.”
“Preventing the abuse of power to conduct criminal activity remains among the highest priorities of the FBI,” stated Paul M. Abbate, Special Agent in Charge of the FBI Detroit Field Office. “FBI Detroit, in concert with the Michigan Attorney General’s Public Integrity Unit and the U.S. Attorney's Office, will continue to investigate these types of crimes and bring to justice those who abuse the public’s trust.”
This case was investigated by the Federal Bureau of Investigation in collaboration with the Michigan Attorney General's Public Integrity Unit.
An indictment is only a charge and is not evidence of guilt. Every defendant is entitled to a fair trial in which it will be the government's burden to prove guilty beyond a reasonable doubt.
Florida Women Sentenced to 24 Months in Prison for LSU Health Sciences Center Bribery SchemeRead the Press Release
SHREVEPORT, La. – United States Attorney Stephanie A. Finley announced today that a Florida woman was sentenced to 24 months in prison for mail fraud in connection with a bribery scheme involving a former staff member at Louisiana State University Health Sciences Center (LSUHSC).
Rita M. Myler, 53, of Miramar Beach, Fla., was sentenced by U.S. District Judge S. Maurice Hicks Jr. on one count of mail fraud. She was also sentenced to three years of supervised release and ordered to pay $531,976.90 in restitution. According to the October 6, 2014, guilty plea, Myler paid kickbacks to LSUHSC’s Human Leukocyte Antigen (HLA) Laboratory Assistant Director Anthony Roggero so that he would continue buying products from her company, Sangre Biologicals. The kickbacks were mailed to Roggero’s house from July 2001 to July 2008. Sangre Biologicals received more than $500,000 from LSUHSC during the course of the scheme. The HLA laboratory played a critical support role for solid organ and bone marrow transplants.
Roggero, of Shreveport, pleaded guilty on October 31, 2012, to one count of mail fraud for his role in the scheme. He was sentenced on November 10, 2014, to 18 months in prison, three years of supervised release, and was ordered to pay $200,000 restitution.
The FBI conducted the investigation. Assistant U.S. Attorney Cytheria D. Jernigan prosecuted the case.
Florida Man Sentenced to 5 Years Imprisonment for Structuring More Than $2.5 Million in Proceeds of Drug TraffickingRead the Press Release
FRESNO, Calif. — Chad Allen Riffle, 22, resident of Citrus Springs, Florida, was sentenced today by United States District Judge Lawrence J. O'Neill to 5 years in prison for structuring cash transactions, United States Attorney Benjamin B. Wagner announced.
According to court documents, Riffle and seven co-defendants opened and maintained bank accounts for the purpose of funneling cash proceeds of drug trafficking from Florida and other states back to California. Riffle made more than $2.5 million in cash deposits in amounts designed to avoid triggering financial institution reporting requirements.
This case is being brought as part of Operation Footprint, a nationwide law enforcement initiative led by the U.S. Attorney’s Offices, the Internal Revenue Service- Criminal Investigation, the Drug Enforcement Administration, and the United States Postal Inspection Service. Operation Footprint targets large drug trafficking organizations by identifying the transfer of drug proceeds through financial institutions, bulk cash smuggling and other forms of money transfers. Operation Footprint is focused on bringing criminal charges based on Bank Secrecy Act violations in addition to violations of the Controlled Substances Act and the Money Laundering Control Act.
This case is also the product of the Organized Crime Drug Enforcement Task Force (OCDETF), a focused multi-agency, multi-jurisdictional task force investigating and prosecuting the most significant drug trafficking organizations throughout the United States by leveraging the combined expertise of federal, state and local law enforcement agencies. Assistant U.S. Attorneys Grant B. Rabenn, Patrick R. Delahunty, and Jeffrey Spivak are prosecuting the case.
Federal Correctional Officer Sentenced on Bribery ChargesRead the Press Release
Contact Person: A. Bradley Parham (843) 727-4381
Columbia, South Carolina ---- United States Attorney Bill Nettles stated today that Charlotte McLaughlin was sentenced in federal court in Florence, South Carolina, for Bribery, a violation of 18 U.S.C. § 201(b)(2)(C). United States District Judge R. Bryan Harwell of Florence sentenced McLaughlin to 13 months imprisonment and 3 years supervised release.
Evidence presented at the guilty plea hearing established that in 2012 and 2013, McLaughlin, who was a Federal Correctional Officer at the time, accepted bribes from inmates and their associates in exchange for which she brought contraband, tobacco and cellphones, to inmates at the Federal Correctional Institution in Bennettsville.
The case was investigated by agents of the Department of Justice, Office of Inspector General. Assistant United States Attorney A. Bradley Parham of the Florence office prosecuted the case.Detroit man pleads guilty to heroin crimeRead the Press Release
HUNTINGTON, W.Va. – United States Attorney Booth Goodwin announced today that Darius Jerome Perry, 31, of Detroit, pleaded guilty to aiding and abetting possession of heroin with intent to distribute.
On Aug. 21, 2013, Huntington Violent Crimes and Drug Task Force agents executed a search warrant at a residence in the 200 block of 8th Ave. in Huntington. Perry admitted to utilizing the residence to distribute heroin. During the search, agents seized 134.8 grams of heroin and $10,431.76. Perry stated he jointly possessed the heroin with another man.
On Aug. 22, 2013, agents executed a second search warrant at the same residence, where they located and seized $3,000 concealed in a television. Perry stated the money seized during both searches was proceeds from heroin distributions.
Perry faces up to 40 years in federal prison and a $5 million fine. He is scheduled to be sentenced on May 11, 2015.
Chief United States District Judge Robert C. Chambers presided over the plea hearing.
The case is being investigated by the Huntington Violent Crimes and Drug Task Force. Assistant United States Attorney Joseph Adams is in charge of the prosecution.
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Crack Cocaine Dealer Sentenced on Drug ChargesRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051ROCHESTER, N.Y.—U.S. Attorney William J. Hochul, Jr. announced today that Sekou Howard, a/k/a Kou, 41, of Rochester, NY, who was convicted of conspiracy to possess with intent to distribute and distribution of 28 grams or more of crack cocaine, was sentenced to 147 months in prison by U.S. District Judge Frank P. Geraci, Jr. Howard was also ordered to forfeit two rounds of ammunition seized during the investigation.
Assistant U.S. Attorney Robert A. Marangola, who handled the case, stated that Howard and his cousin James Hardaway, a/k/a Jabber, and others purchased large quantities of powder cocaine which was processed into crack cocaine, packaged, and resold in various quantities in Rochester. The defendant and Hardaway were arrested on January 16, 2014 following the execution of search warrants at 80 Ambrose Street and 153 Parkway in Rochester. During the searches, officers seized crack cocaine packaged for street sale, paraphernalia for weighing, processing and packaging narcotics, U.S. currency, and rounds of .38 caliber handgun ammunition.
Hardaway has been convicted and will be sentenced on March 9, 2015.
The sentencing is the culmination of an investigation on the part of the Rochester Police Department, under the direction of Chief Michael Ciminelli and the Federal Bureau of Investigation.
Construction Worker Sentenced to Federal Prison for Cocaine DeliveryRead the Press Release
Follow @SDILNewsA St. Charles, Missouri, resident was sentenced to federal prison for unlawful distribution of a controlled substance on February 6, 2015, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today. Charles Sweeny, 56, was sentenced to 57 months in federal prison, a $7,500 fine, a $100 special assessment, and three years of supervised release.
Sweeny was indicted on January 23, 2014, and pleaded guilty on August 28, 2014. The evidence established that Charles Sweeny worked as a construction worker for a man named David Ray, 55, of Fieldon, Illinois. Ray owned various construction businesses in the area and an investigation revealed that Sweeny was supplying Ray with cocaine. Agents arranged for two controlled purchases of cocaine to be made. The first resulted in the seizure of 126.5 grams of cocaine on March 9, 2012, when Sweeny personally delivered cocaine to an address in Jersey County, Illinois. The second controlled delivery was interrupted and Sweeny was caught while he was in the process of delivering cocaine to a Jersey County, Illinois, address. This second incident resulted in a seizure of 301.2 grams of cocaine, on April 17, 2012. During the investigation, agents also seized an additional 229.9 grams of cocaine that Sweeny had supplied to Ray. Sweeny was arrested after the second controlled delivery on April 17, 2012.
David Ray was separately prosecuted for unlawfully possessing firearms while being a user of cocaine. In addition, his various businesses were investigated and he was convicted for tax evasion for using his businesses to pay personal expenses, by vesting ownership of personal assets in the name of his businesses, and by filing false tax returns with the IRS or refusing to file a US Individual Tax Return all together. In tax years 2005-2010, Ray concealed income from the IRS for the purpose of limiting his tax liability resulting in him avoiding $1,272,904.83 in federal income taxes that he otherwise would have been required to pay. On December 22, 2014, David Ray was sentenced to 37 months in prison, a $7,500 fine, $1,272,904.83 in restitution, a $200 special assessment, and three years of supervised release. Ray also forfeited a gun collection valued between $75,000-$100,000.
The investigation was conducted by agents from the Internal Revenue Service / Criminal Investigations, the Jersey County Sheriff’s Department, the Bureau of Alcohol Tobacco, Firearms and Explosives, the Drug Enforcement Administration, and the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorney Steven D. Weinhoeft.
Community leaders collaborate to tackle drug abuse in North Central West VirginiaRead the Press Release
MORGANTOWN, WEST VIRGINIA – Community leaders in Monongalia, Marion, and Harrison Counties announced the formation of a working group to address drug addiction and overdoses in the region.
United States Attorney William J. Ihlenfeld, II, made the announcement along with officials from a variety of professions, including education, law enforcement, healthcare, treatment, and the news media. Ihlenfeld will serve as co-chair of the group, which will present an addiction action plan to the community in the spring.
“Addiction has grabbed ahold of communities in North Central West Virginia and we’re committed to pursuing innovative and tangible ways to loosen that grip,” stated Ihlenfeld. “The number of heroin overdose deaths in West Virginia continues to rise and this has become more than just a law enforcement problem – it’s a true public health crisis.”
The working group is part of the United States Attorney’s Addiction Action Plan, a program designed to target drug abuse by capitalizing on synergies created by bringing together leaders from fields relevant to the issue. The goals of the group include decreasing heroin use, promoting increased access to quality substance abuse treatment, choking off the supply of heroin to the region, and making North Central West Virginia stronger, safer, and healthier.
The subcommittees that comprise the Addiction Action Plan will be led by a diverse group of leaders from North Central West Virginia, including:
• Dr. Carl “Rolly” Sullivan, MD • Director, Addictions Program, WVU School of Medicine
• Dr. James Berry, MD • Director, Inpatient Addiction Services, WVU Health Sciences Center
• Dr. Patrick Ryan • Director of Behavioral Medicine, Fairmont General Hospital
• Dr. Frank Devono • Superintendent, Monongalia County Schools
• Aaron Williams • News Director, WBOY-TV
• John Miller • Executive Editor, The Clarksburg Exponent Telegram
• Barbara Evans Fleischauer • Representative, W.Va. House of Delegates
• Edward Preston • Chief, Morgantown Police Department
• Kelley Moran • Chief, Fairmont Police Department
• Louis Ortenzio • Senior Ministry Leader, Celebrate Recovery
• Jo Anne McNemar • Harrison County Prevention Partnership
• Ted Offutt • Marion County Day Report Center Director
“Public comments at the recent town hall meeting at Bridgeport High School in Harrison County made it very clear that now is the time for swift action,” said Ihlenfeld. “I’m confident that the working group that we’ve formed will develop an inventive and comprehensive approach to combat addiction in the region.”Individuals interested in obtaining additional information on the Addiction Action Plan are encouraged to contact the United States Attorney’s Office for the Northern District of West Virginia at (304) 234-0100. Regular updates on the progress of the Addiction Action Plan will be available via the official Twitter feed of the U.S. Attorney’s Office, @NDWVnews.
Chelsea Woman Pleads Guilty to Being an Accessory After the Fact to a Pharmacy RobberyRead the Press Release
Contact: F. Todd Lowell
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Nicole A. Breton, 21, of Chelsea, Maine pleaded guilty today in U.S. District Court to being an accessory after the fact to a pharmacy robbery. An accessory after the fact is a person who, knowing that an offense against the United States has been committed, comforts or assists the offender in order to hinder or prevent his apprehension, trial or punishment.
Court records show that on September 2, 2014, Dominic J. Pomerleau robbed the Rite Aid Pharmacy located on Hospital Street in Augusta, Maine. He approached the pharmacy counter with a note that demanded oxycodone and absconded with three bottles of oxycodone. Breton was waiting for Pomerleau in a getaway car. She emptied the pills from the bottles and threw the empty bottles and caps out of the car window. Pomerleau, Breton, and the driver of the car fled to Breton’s residence where they spent the night consuming many of the stolen oxycodone pills. Pomerleau pled guilty to pharmacy robbery on January 23, 2015 and awaits sentencing.
Breton faces up to 10 years in prison, a $125,000 fine and restitution. She will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
The investigation was conducted by the Augusta Police Department and the Federal Bureau of Investigation.
Charlotte Man Sentenced to More Than Five Years in Prison for Defrauding Investor in Ponzi SchemeRead the Press Release
CHARLOTTE, N.C. – Today, U.S. District Judge Max O. Cogburn, Jr. sentenced John Reid Perkins, 45, of Charlotte, to serve 64 months in prison followed by three years of supervised release on securities fraud conspiracy charges and for violating the terms of his supervised release stemming from a previous federal conviction, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina. Perkins, who pleaded guilty in September 2013 to one count of securities fraud conspiracy, was also ordered to pay $805,150 as restitution.
Perkins’ conspirator, Terry Wayne Gandy, 51, or Myrtle Beach, S.C. was sentenced in December 2014 to 57 months in prison and three years of supervised release for his role in the conspiracy and was ordered to pay $3,076,411.34 in restitution to his victims.
John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, Thomas J. Holloman III, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division (IRS-CI) and B.W. Colier, Acting Director of the North Carolina State Bureau of Investigation (SBI) join U.S. Attorney Tompkins in making today’s announcement.
According to filed court documents and court proceedings, from 2006 to 2008 Perkins conspired with Gandy and others and tricked victims into investing in a fraudulent real estate investment scheme. Court records show that Perkins owned and operated “Master Home Solutions” (“MHS”), a company that purportedly purchased, remodeled, renovated and resold foreclosed homes. Based on court records, Perkins induced victims by falsely representing their money would be invested in real estate projects through MHS, when, in fact, very little of that money was ever invested. Instead of investing the investors’ money as promised, Perkins, Gandy and others used the funds to pay themselves and to support their lifestyles, including to pay bills, buy cars, and make large cash withdrawals.
According to court documents and court proceedings, the conspirators also used some of the victim’s money to pay purported “profits” to other investors, falsely characterizing them as “gains on investments.” Perkins and his conspirators also used new victims’ money to make payments to old victim-investors, commonly known as “Ponzi” payments. Court records indicate that Perkins and his conspirators further lied to victims, falsely telling them their money was tied up in investments with specific “maturity periods.” In some instances, the defendants advised victims that additional investment funds were needed in order to secure the return of the victims’ original investment, court records indicate.
In handing down the 64 month sentence, Judge Cogburn stressed the significant damage caused to victims by Perkins’ greed and noted that the lengthy sentence was needed to protect the public from futures crimes of the defendant.
In 2007, Perkins was convicted on federal conspiracy, identification document fraud, wire fraud and aggravated identity theft charges and served 33 months in prison. Perkins began a five-year period of supervised release in November 2010. Judge Cogburn revoked Perkins’ supervised release because Perkins violated several of his conditions by, among other things, engaging in unauthorized travel and defrauding a victim of approximately $125,000 in a sham tugboat sale. Perkins was remanded into federal custody following the sentencing hearing. He will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
The investigation was handled by the FBI, IRS and SBI. Assistant United States Attorney Mark T. Odulio of the U.S. Attorney’s Office in Charlotte prosecuted the case.
Buffalo Woman Sentenced for Conspiracy to Defraud the IrsRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5836
FAX: (716) 551-3051
BUFFALO, N.Y. – U.S. Attorney William J. Hochul, Jr. announced today that Keianna A. Jones, 29, of Buffalo, NY, who was convicted of conspiracy to defraud the Internal Revenue Service, was sentenced to time served, one year supervised release and ordered to pay restitution totaling $54,316.00 by Chief U.S. District Judge William M. Skretny.
Assistant U.S. Attorney Trini E. Ross, who handled the case, stated that the defendant conspired with others to submit false claims for income tax refunds. Blank W-2 forms were obtained from local business establishments for use in committing this fraud. Jones also had others obtain legitimate W-2 forms from actual employers and then altered the forms to create new W-2s by changing income and withholding information so as to maximize the refund to be obtained. In working with others, a portion of the refund received would go to the defendant.
Co-defendant Dominique Taylor, 29, of Buffalo, NY, was also convicted of conspiracy to defraud the Internal Revenue Service.
The sentencing is the result of an investigation on the part of Special Agents of the Internal Revenue Service, Criminal Investigation Division under the direction of Special Agent-In-Charge, Shantelle P. Kitchen.
Bakersfield Resident Sentenced to 5-year Prison Term for Growing Marijuana on Ecological ReserveRead the Press Release
FRESNO, Calif. — Cruz Soria, 29, of Bakersfield, California was sentenced today to 5 years in prison for conspiring to manufacture, distribute and possess with intent to distribute marijuana in the Fay Canyon area of the Canebrake Ecological Reserve, U.S. Attorney Benjamin B. Wagner announced. Soria was also ordered to pay $2,568.85 in restitution to the High Sierra Trail Volunteer Crew for the cost of cleaning up the grow site.
The Canebrake Ecological Reserve is located 10 miles east of Lake Isabella in northeastern Kern County. It was first inhabited in about 1000 B.C. by the Tubatulabel culture and is currently home to numerous rare and protected plants and animals, including the federally-protected golden and bald eagles and peregrine falcon, the federally-threatened California red-legged frog and Valley elderberry longhorn beetle, and the endangered Southwestern willow flycatcher.
Soria’s sentence follows his guilty plea last year. In pleading guilty, Soria acknowledged he was responsible for cultivating 454 marijuana plants in the ecological reserve. Law enforcement officers arrested Soria at the grow site and seized the plants, about twelve pounds of processed marijuana, and a firearm. The officers also found several highly toxic chemicals, including Fosfuro de Zinc or zinc phosphide, a rat poison illegal to use in the United States without a license, and Furadan, an insecticide banned by the EPA for usage on crops consumed by humans. Dead coyote, snakes and other animals were found at the grow site. Upon completion of his prison sentence, Soria will be supervised by the U.S. Probation Office for 4 more years.
This case is the product of an investigation by the U.S. Forest Service, U.S. Department of Homeland Security - Homeland Security Investigations (HSI), California Department of Fish and Game, and Kern County Sheriff’s Office. Assistant United States Attorney Karen Escobar prosecuted the case.BGF Leader Tavon White Sentenced to 12 Years in Prison in Baltimore Jail Racketeering ConspiracyRead the Press Release
Baltimore, Maryland - U.S. District Judge Ellen L. Hollander sentenced Tavon White, a/k/a Bulldog and Tay, age 37, of Baltimore, today to 12 years in prison followed by three years of supervised release for racketeering conspiracy arising from his running of operations of the Black Guerilla Family (BGF) gang inside the Baltimore City Detention Center (BCDC).
In connection with his federal guilty plea, White also pleaded guilty to a state charge of attempted murder, for which he received a sentence of 20 years in prison, served concurrent to his federal sentence.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Secretary Stephen T. Moyer of the Maryland Department of Public Safety and Correctional Services (DPSCS); Baltimore Police Commissioner Anthony W. Batts; and Baltimore City State’s Attorney Marilyn Mosby.
This case was developed as a result of the efforts of the Maryland Prison Task Force, formed in 2011 with the Maryland Department of Public Safety and Correctional Services, local, state and federal law enforcement agencies, and prosecutors. The Task Force has met regularly for over three years, generating recommendations to reform prison procedures and producing leads that have been pursued by state, local and federal criminal investigators. Investigations are continuing.
According to court documents, BGF has been the dominant gang at the Baltimore City Detention Center (BCDC), and in several connected facilities, including the Baltimore Central Booking Intake Center, the Women’s Detention Center, which houses many men, and in the Jail Industries Building.
According to his plea agreement, White has been a member of the BGF since 2000 and was in pretrial custody at BCDC from 2009 to 2013. He became the lieutenant commander of the BGF at BCDC and then the commander in 2011. Throughout his years at BCDC, White was involved with and often directed the smuggling of contraband into BCDC, including cell phones, tobacco and drugs, through the services of correctional officers (CO’s), who received payments, gifts or a share of the profits. Fellow BGF inmates and co-defendants also directed smuggling and often worked in concert with White.
White admitted that he was personally involved in sexual relationships with and impregnated four CO’s. Outside the prison facility, White and his closest BGF allies frequently used other people, including several co-defendants, to obtain contraband, hold it or deliver it to correctional officers for smuggling.
Forty of the 44 defendants charged in the racketeering conspiracy have been convicted, including 24 correctional officers. Thirty-five defendants pleaded guilty; eight defendants went to trial and one defendant has died.
U.S. Attorney Rosenstein recognized the efforts of the other members of the Maryland Prison Task Force, including: the Maryland State Police, Prince George’s County Police Department, United States Marshals Office, DEA, Washington-Baltimore High Intensity Drug Trafficking Area and Maryland Coordination and Analysis Center.
United States Attorney Rod J. Rosenstein praised the FBI, Maryland Department of Public Safety and Correctional Services, Baltimore Police Department, and Maryland Prison Task Force, for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys Robert R. Harding and Ayn B. Ducao, who prosecuted this Organized Crime Drug Enforcement Task Force case.
Attorney Pleads Guilty to Bank Fraud ChargeRead the Press Release
PITTSBURGH – An attorney has pleaded guilty in federal court to a charge of bank fraud, United States Attorney David J. Hickton announced today.
Erik Sobkiewicz, 51, of Pittsburgh, Pa., pleaded guilty to one count before United States District Judge David Cercone.
Assistant United States Attorney Brendan T. Conway is prosecuting this case on behalf of the government. Mr. Conway provided the following information to the Court at the time of the plea:
Sobkiewicz was an attorney involved in a number of interrelated schemes. The first scheme, involved Sobkiewicz embezzling funds from the law firm that employed him. He used the resources of the law firm to advance businesses that he, unbeknownst to the law firm, controlled. He had the law firm invoice those businesses, knowing that the businesses would not pay the bills. The billings lulled the law firm into believing that what the defendant was doing was legitimate. In addition, he diverted money from a real estate closing owed to the law firm to a personal account, and he diverted client funds held in the law firm’s escrow account to his personal account.
Sobkiewicz was also involved in several loan fraud schemes. He applied for a series of loans from Indiana First Savings Bank. For the last of the loans, which was for $350,000, Sobkiewicz used the securities account of an individual as collateral for the loan without that individual’s permission, and he falsely represented that Indiana First Savings Bank would be in first lien position with regard to the property serving as collateral for the loan when, in fact, Indiana First Savings Bank was not going to be in first lien position because of a previous loan Sobkiewicz obtained collateralized by that property.
Another loan fraud scheme involved Milestone Bank and a property in Philadelphia that Sobkiewicz claimed he was developing. As with Indiana First Savings Bank, Sobkiewicz falsely represented to Milestone Bank, the lender in the Philadelphia transaction, that Milestone Bank would sit in first lien position when, in fact, Milestone Bank was going to be in second lien position because of a previous loan obtained by Sobkiewicz and collateralized by this property. Sobkiewicz forged a mortgage satisfaction of the lender in first lien position to make it appear as though Milestone Bank would be in first lien position.
In addition, Milestone Bank wanted to see that Sobkiewicz had invested his own money into the Philadelphia property and that he had equity in the property. He was able to show them a $600,000 investment of purportedly his own money. In reality, however, the $600,000 was not Sobkiewicz’s money. He obtained that money by soliciting the investment of another individual using a series of misrepresentations, including that the investor would be in second lien position behind only Milestone Bank with regard to the Philadelphia property and in first lien position with regard to other properties owned by Sobkiewicz. In reality, the investor is in third lien position with regard to the Philadelphia property in the second lien position with regard to the other properties.
Judge Cercone scheduled sentencing for May 21, 2015, at 10 am. The law provides for a total sentence of 50 years in prison, a fine of $1,250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
The Federal Bureau of Investigation and the Allegheny County District Attorney’s Office conducted the investigation that led to the prosecution of Sobkiewicz.
Ambulance Company Manager Sentenced to 78 Months in Prison for $5.5 Million Medicare Fraud SchemeRead the Press Release
The general manager of a Southern California ambulance company was sentenced today to 78 months in federal prison for his role in a $5.5 million scheme to defraud the Medicare program.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Acting U.S. Attorney Stephanie Yonekura of the Central District of California, Special Agent in Charge Glenn R. Ferry of the U.S. Department of Health and Human Services, Office of Inspector General’s (HHS-OIG) Los Angeles Region and Assistant Director in Charge Bill Lewis of the FBI’s Los Angeles Field Office made the announcement.
Wesley Harlan Kingsbury, 34, of Bloomington, California, pleaded guilty on Sept. 15, 2014, to one count of conspiracy to commit health care fraud, one count of conspiracy to obstruct a Medicare audit and one count of making materially false statements to federal law enforcement officers. In addition to the prison sentence, U.S. District Judge Dale S. Fischer of the Central District of California ordered Kingsbury to pay $1,338,413 in restitution.
According to admissions made in connection with his guilty plea, Kingsbury was the general manager of Alpha Ambulance Inc. (Alpha), which specialized in the provision of non-emergency ambulance transportation services to Medicare beneficiaries, primarily to and from dialysis treatments. Kingsbury admitted that between April 2010 and July 2012, he conspired with the owners of Alpha, Alex Kapri and Aleksey Muratov, and the training supervisor, Danielle Medina, to bill Medicare for ambulance transportation services for individuals that did not need to be transported by ambulance. In addition, as general manager, Kingsbury instructed emergency medical technicians employed by Alpha to conceal the true medical condition of patients they were transporting by altering paperwork and creating false justifications for the transportation services.
In early 2012, Medicare notified Alpha that they would be subject to a Medicare audit. In response, Kingsbury admitted that he and his co-conspirators altered patient documentation to falsely justify the ambulance transportation services. Specifically, Kingsbury admitted that he and others used light tracing tables to trace over original documents and create falsified patient documentation for submission to Medicare. They then shredded the original patient documents.
Kingsbury and his co-conspirators submitted $5,522,079 in fraudulent claims to Medicare, and Medicare paid $1,338,413 on those claims.
Further, according to admissions in connection with Kingsbury’s guilty plea, in April 2012, Kingsbury was approached by law enforcement officers and asked to assist with the investigation into Alpha. Kingsbury disclosed to the owners of Alpha the names of the law enforcement officers who were conducting the investigation and the questions they had asked. On May 1, 2012, Kingsbury falsely denied to the law enforcement agents that he had disclosed that information to the owners of Alpha.
Kapri, Muratov and Medina pleaded guilty to conspiracy to commit health care fraud on Oct. 28, 2013. They were sentenced to 75 months, 108 months, and 30 months in prison, respectively.
The case was investigated by the FBI and the Los Angeles Region of HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California. The case was prosecuted by Trial Attorneys Blanca Quintero and Alexander F. Porter, and Assistant Chief Ben Curtis of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 2,100 defendants who have collectively billed the Medicare program for more than $6.5 billion. In addition, HHS’s Centers for Medicare & Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
Accused Real Estate Fraudster Extradited from SpainRead the Press Release
HOUSTON - Robert Alan Berry, 60, is set to appear in federal court following his extradition from Spain on charges of wire fraud and money laundering in relation to an international real estate scam, announced U.S. Attorney Kenneth Magidson and Lucy Cruz, special agent in charge of Internal Revenue Service – Criminal Investigation (IRS-CI). Berry, a U.S. citizen formerly in Calistoga, Calif., is charged with two counts of wire fraud and two counts of money laundering.
The scam Berry allegedly executed affected residents of Houston as well as people in other cities in the U.S. and other countries around the world.
The four-count indictment charging Berry was returned Feb. 26, 2014. It alleges that in 1998, Berry co-founded Pelican Eyes Piedras y Olas S.A. (PEPO) as a hotel and resort in San Juan del Sur, Nicaragua. The resort grew over the next 10 years, but its financial health declined during that time, according to the allegations. Investors had provided approximately $31 million to PEPO and Berry built more than 60 units through two phases of development. However, the indictment alleges Berry ultimately sold more units to investors than he could afford to build.
In an attempt to keep the resort going, Berry allegedly turned to fraud. The charges indicate he lied to investors and lenders in order to obtain millions of dollars in investment funds and loans. Berry also would sell the same unit to more than one buyer, use already sold units as collateral for loans or sell units that he had already pledged as collateral, according to the allegations.
In October 2009, PEPO suffered a financial collapse, at which time Berry fled Nicaragua, eventually settling in Spain.
With the assistance of Interpol and Spanish authorities, Berry was arrested Oct. 24, 2014. He was eventually transported to the United States and arrived in Houston Feb. 6, 2015. He is set to make his initial appearance on the charges at 2:00 p.m. today before U.S. Magistrate Judge Stephen Smith.
If convicted, he faces up to 20 years on each count of wire fraud as well as a maximum of 10 years for each of the money laundering charges. Both convictions also carry a possible $250,000 fine.
The charges are the result of an investigation by IRS-CI. Assistant U.S. Attorney Robert S. Johnson is prosecuting the case.
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.Adams County Correctional Facility Inmate Pleads Guilty to Second Degree MurderRead the Press Release
Jackson, Miss - Jesus Beltran Rodriguez, 36, a federal inmate from Mexico, pled guilty today, before U.S. Senior District Judge David C. Bramlette III, to second degree murder, U.S. Attorney Gregory K. Davis announced.
The offense occurred on May 20, 2012 during a riot at the Adams County Correctional Center. Several correctional officers were assaulted and one Correctional Officer (CO) died as a result of injuries he received during the assaults. Other COs were taken captive and held hostage for several hours by participants in the riot. Total damage to ACCC was estimated to be $1,305,142.00.
Senior U.S. District Judge David C. Bramlette III will sentence Rodriguez on May 19, 2015. He faces a maximum sentence of life in prison and $250,000 fine.
This case was investigated by the Federal Bureau of Investigation, with assistance from the Adams County Sheriff’s Office. Assistant U.S. Attorneys Pat Lemon and Jerry Rushing are prosecuting the case.
6 February 2015
Zachary Man Indicted for Conspiracy to Commit Health Care Fraud and Wire FraudRead the Press Release
BATON ROUGE, LA - United States Attorney Walt Green announced today that a federal grand jury has returned a twenty-five count indictment against SEDRIC C. BLAKES, age 42, of Zachary, Louisiana. The Grand Jury charged BLAKES with conspiring with others to commit healthcare fraud and wire fraud, in violation of Title 18, United States Code, Section 1349, as well as with committing multiple counts of healthcare fraud and wire fraud, in violation of Title 18, United States Code, Sections 1347 and 1343. The Indictment also includes a forfeiture allegation which requires BLAKES to forfeit the proceeds of his fraud if convicted.
The Indictment alleges that, from approximately January 2008 and continuing through March 2013, BLAKES engaged in a scheme to defraud Medicaid while employed as the Chief Operating Officer of Extraordinary Care Network, Inc. (“Extraordinary Care”). The Indictment continues that Extraordinary Care was a Baton Rouge-area Medicaid attendant care service provider, which purportedly provided direct support and assistance, including feeding, bathing, and grooming, to the mentally impaired and financially needy, thereby allowing recipients to achieve or maintain increased independence, inclusion in the community, or simply to relieve recipients’ primary caregivers.
As alleged in the Indictment, BLAKES and his co-conspirators submitted fraudulent claims to Medicaid in which they claimed to have provided attendant care services, when BLAKES and his co-conspirators provided no such services. To support the fraudulent claims submitted to Medicaid, BLAKES falsified and/or direct a co-conspirator to falsify recipients’ records to make it appear as though BLAKES, his co-conspirators, or other unwitting Extraordinary Care employees had provided care to particular recipients. Among other instances, BLAKES fabricated and signed fictitious records indicating he had provided attendant care services to recipients in their homes, while the investigation revealed that BLAKES was out of town, gambling at a casino, or elsewhere, at the time of the purported service.
The Indictment alleges BLAKES executed this scheme from approximately January 2008 until March 2013, during which time Extraordinary Care submitted approximately $16,428,814 in claims to Medicaid and was paid approximately $14,796,631.
This ongoing matter is being investigated by the Federal Bureau of Investigation (FBI) and the Medicaid Fraud Control Unit of the Louisiana State Attorney General’s Office (MFCU), and is being brought as part of the Medicare Fraud Strike Force, under the supervision of the United States Attorney’s Office and the Fraud Section of the Criminal Division of the U.S. Department of Justice. This case is being prosecuted by Assistant U.S. Attorney Shubhra Shivpuri and DOJ Trial Attorney Dustin M. Davis.
NOTE: An indictment is an accusation by the Grand Jury. The defendant is presumed innocent until and unless adjudicated guilty at trial or through a guilty plea.
Week in Review – South BendRead the Press Release
South Bend, Indiana — The United States Attorney’s Office announced the following activity in Federal Court:
PLEAS
- Brandon Wright, 27, of Mishawaka, Indiana pled guilty to the felony offense of being a felon in possession of a firearm. The magistrate judge is recommending that the district court accept the tendered guilty plea. Parties have 14 days in which to object to the magistrate judge’s recommendation. This charge was filed as a result of an investigation by Bureau of Alcohol, Tobacco, Firearms and Explosives. Sentencing has been set for May 11, 2015. This case is being prosecuted by Assistant United States Attorney Donald Schmid.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
Week in Review – HammondRead the Press Release
Hammond, Indiana — The United States Attorney’s Office announced the following activity in Federal Court:
PLEAS
- Reggie Spencer, 27, of Dolton, Illinois pled guilty to the felony offense of distribution of cocaine base. The magistrate judge is recommending that the district court accept the tendered guilty plea. Parties have 14 days in which to object to the magistrate judge’s recommendation. This charge was filed as a result of an investigation by the Drug Enforcement Administration. This case is being prosecuted by Assistant United States Attorney Thomas McGrath.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
Unlicensed Detroit Doctor Convicted in $4.69 Million Medicare Fraud SchemeRead the Press Release
A federal jury in Detroit today convicted an unlicensed physician for his participation in a nearly $4.7 million Medicare fraud scheme, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan, Special Agent in Charge Paul M. Abbate of the FBI’s Detroit Field Office and Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Chicago Regional Office.
Wilfred Griffith, 64, of Detroit, a graduate of a foreign medical school with no medical license, was found guilty of one count of conspiracy to commit health care fraud and one count of conspiracy to solicit and receive health care kickbacks. A sentencing hearing is scheduled for July 8, 2015, before U.S. District Judge Sean F. Cox of the Eastern District of Michigan.
According to evidence presented at trial, Griffith worked as an unlicensed physician at Phoenix Visiting Physicians in 2010 and 2011. At that clinic, Griffith treated Medicare beneficiaries and used prescription pads pre-signed by Dr. Dwight Smith to prescribe medicine.
The evidence demonstrated that Griffith also referred Medicare beneficiaries to a Detroit-area home health company called Cherish Home Health Services Inc. (Cherish) in exchange for kickbacks. In ordering the home health services, Griffith used the names and signatures of Dr. Smith and two other Detroit-area physicians to certify that the beneficiaries were homebound and needed home health services, when they did not.
Evidence showed that based on the fraudulent referrals from Griffith and others, Cherish submitted false claims to Medicare for home health services that were never provided and were not medically necessary. Medicare beneficiaries pre-signed supporting medical paperwork that was then completed and signed by others at Cherish to falsely show that care was provided.
Between November 2009 and December 2013, Medicare paid Cherish nearly $4.7 million, which included more than $680,000 for home health services purportedly rendered to beneficiaries referred by Griffith using the names of Dr. Smith and the two other physicians.
Two other individuals have pleaded guilty for their roles in this scheme. Zia Hassan, 48, the owner of Cherish, pleaded guilty on Jan. 16, 2015, and Nathan Miller, 53, a patient recruiter who referred beneficiaries to Hassan in exchange for cash kickbacks, pleaded guilty on Aug. 4, 2014. On May 7, 2012, Dr. Smith also pleaded guilty to one count of conspiracy to commit health care fraud, and on June 12, 2014, U.S. District Judge Gerald E. Rosen of the Eastern District of Michigan sentenced Dr. Smith to three years in prison.
The case was investigated by HHS-OIG and the FBI and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan. The case is being prosecuted by Trial Attorney Katharine A. Wagner and Special Trial Attorney Katie R. Fink of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Patrick J. Hurford of the Eastern District of Michigan.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,100 defendants who have collectively billed the Medicare program for more than $6.5 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
United States Settles False Claims Act Suit Against Good Shepherd Hospice Inc. and Related EntitiesRead the Press Release
Midwest Hospice Chain Allegedly Billed Medicare for Ineligible Patients
Today, Good Shepherd Hospice Inc., Good Shepherd Hospice of Mid America Inc., Good Shepherd Hospice, Wichita, L.L.C., Good Shepherd Hospice, Springfield, L.L.C., and Good Shepherd Hospice – Dallas L.L.C. (collectively Good Shepherd) agreed to pay $4 million to resolve allegations that Good Shepherd submitted false claims for hospice patients who were not terminally ill. Good Shepherd is a for-profit hospice headquartered in Oklahoma City which provides hospice services in Oklahoma, Missouri, Kansas and Texas.
“The Medicare hospice benefit is intended to provide comfort and care to patients nearing the end of life,” said Acting Assistant Attorney General Joyce R. Branda of the Justice Department’s Civil Division. “We will continue to aggressively pursue companies that abuse the hospice benefit to improperly inflate their profits.”
The Medicare hospice benefit is available for patients who elect palliative treatment (medical care focused on providing patients with relief from pain, symptoms or stress) for a terminal illness and have a life expectancy of six months or less if their illness runs its normal course. When a Medicare patient receives hospice services, that individual is no longer entitled to Medicare coverage for care designed to cure his or her illness.
The government alleged that Good Shepherd knowingly submitted or caused the submission of false claims for hospice care for patients who were not terminally ill. Specifically, the United States contended that Good Shepherd engaged in certain business practices that contributed to claims being submitted for patients who did not have a terminal prognosis of six months or less, by pressuring staff to meet admissions and census targets and paying bonuses to staff, including hospice marketers, admissions nurses and executive directors, based on the number of patients enrolled. The United States further alleged that Good Shepherd hired medical directors based on their ability to refer patients, focusing particularly on medical directors with ties to nursing homes, which were seen as an easy source of patient referrals. The United States also alleged that Good Shepherd failed to properly train staff on the hospice eligibility criteria.
“Health care fraud puts profits above patients, and steals from taxpayers,” said U.S. Attorney Tammy Dickinson of the Western District of Missouri. “In this case, company whistleblowers alleged that patients received unnecessary hospice care while Good Shepherd engaged in illicit business practices to enrich itself at the public’s expense. Today’s settlement fairly resolves those issues and puts measures in place to prevent similar conduct in the future.”
In addition, as part of the settlement, each Good Shepherd entity agreed to enter into a corporate integrity agreement with the U.S. Department of Health and Human Services-Office of the Inspector General (HHS-OIG), which will provide for procedures and reviews to be put into place to avoid and promptly detect conduct similar to that which gave rise to the settlement.
“Being a hospice provider in the Medicare program is a privilege, not a right,” said Special Agent in Charge Mike Fields of the HHS-OIG Dallas Region. “Hospice providers that seek to boost profits by providing hospice services to Medicare beneficiaries who are not terminally ill compromise both the health of its patients as well as the integrity of Medicare. Our agency will continue to hold such hospice providers accountable for their actions.”
The settlement resolves allegations filed by relators Kathi Cordingley and Tracy Jones, former employees of Good Shepherd, under the qui tam or whistleblower provisions of the False Claims Act, which authorize private parties to sue for fraud on behalf of the United States and share in the recovery. The relators will receive approximately $680,000.
This suit is part of 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 $23.5 billion through False Claims Act cases, with more than $15 billion of that amount recovered in cases involving fraud against federal health care programs.
This matter was investigated by the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the Western District of Missouri and HHS-OIG. The claims asserted against defendants are allegations only and there has been no determination of liability.
The lawsuit is captioned United States ex rel. Cordingley and Jones v. Good Shepherd Hospice, Mid America, Inc., No. 4:11-cv-1087 (W.D. Mo.).
U.S. Attorney Finley Keynote Speaker at Grambling State University's Annual Luncheon Recognizing Louisiana's LeadersRead the Press Release
GRAMBLING, La. – United States Attorney Stephanie A. Finley was the keynote speaker at Grambling State University’s Fourth Annual Martin Luther King Jr. Distinguished Leadership Awards Luncheon held Thursday.
“I am honored that Dr. Warrick asked me to address this group of outstanding citizens,” Finley said. “Their stories are incredible, and their commitment to our state is unwavering. These award recipients are an inspiration to me and everyone who hears their stories encouraging us to work harder to make our communities better. That’s what leadership is all about. It is not always glamorous and often the work is not easy, but it is rewarding when you make a difference.”
“United States Attorney Stephanie Finley’s motivating speech challenged the audience to lead and serve,” stated Grambling State University Interim President Dr. Cynthia Warrick. “She reminded us that it was just 50 years ago when justice advocates led and served through resistance; if they had not protested, we would not have the civil rights we experience today. It was an important message that inspired all in attendance and validated our honorees’ recognition.”
Grambling State University honored 10 recipients at the annual Martin Luther King Jr. Distinguished Leadership Awards Luncheon. Winners of the Fannie Lou Hamer Community Service and Leadership Award included: Mr. David Aubrey, the North Louisiana regional director of external affairs for AT&T Inc.; Ms. Janet Durden, president of United Way of Northeast Louisiana; Mr. Clarence W. Hawkins, Louisiana state director for U.S. Department of Agriculture Rural Development, Mrs. Hazel Hunter, a former manager with Louisiana Department of Social Services; Mr. Quentin Messer, assistant secretary for Louisiana Economic Development; Mr. Eldonta Osborne, chief professional officer of the Boys & Girls Club of North Louisiana; and Mr. Willie Washington, federal programs director (No Child Left Behind) at the Lincoln Parish School Board in Ruston, La.
Artist Frank Kelly Jr. was the recipient of the Alvin Ailey Arts and Letters Award, and John Belton, newly elected district attorney for the 3rd Judicial District Court for Lincoln and Union parishes, and his wife, Alana Belton, a former prosecutor, received the Thurgood Marshall Justice Award.
The Martin Luther King Jr. Distinguished Leadership Awards recognizes persons who, through their service to Grambling State University, the state, region and country, exemplify King’s character, leadership and selflessness. Each honoree must have been personally or corporately involved in making tangible, visible and meaningful contributions to the advancement of race relations and/or human rights causes in one or more of the following areas, including but not limited to, the arts, business, education, justice, politics, science and technology, religion and athletics. The awards are presented annually in February.
Grambling State University combines the academic strengths of a major university with the benefits of a small college, a combination that enables students to grow and learn in a serene and positive environment. It offers more than 800 courses and 68 degree programs in five colleges, including an honors college, two professional schools, a graduate school, and a Division of Continuing Education. To find out more about Grambling State University visit www.gram.edu.
Finley is the first female U.S. Attorney to serve in Louisiana. She was selected by President Barack Obama in January of 2010, after being recommended by U.S. Senator Mary Landrieu, and confirmed by the U.S. Senate in June of 2010. United States Attorney Finley was sworn into office on June 2, 2010 to serve the Western District of Louisiana as the chief law enforcement officer for 42 of the state’s 64 parishes. In addition to her duties as the U.S. Attorney, Finley is a Lieutenant Colonel in the U.S. Air Force, and currently serves as Chair of Attorney General Eric Holder’s Advisory Committee’s Office of Management and Budget Committee.
From left to right are: Frank Kelley Jr., Hazel Hunter, Quentin Messer Jr., Janet Durden, Eldonta’ Osborne, U. S. Attorney Finley, Dr. Cynthia Warrick, Clarence Hawkins, David Aubrey, Alana Belton, Honorable John Belton, and Freddie Washington (representing her husband, Willie Washington).
Tax Preparer Indicted for Tax Fraud and Identity Theft Scheme Involving over 200 Fraudulent Returns Seeking over $500,000Read the Press Release
BATON ROUGE, LA - United States Attorney Walt Green announced today that a federal grand jury has returned an indictment against TAMEKIA CECILIA HARTON, age 34, of Baton Rouge, Louisiana. The indictment charges the defendant with false claims against the government, in violation of Title 18, United States Code, Section 287, theft of government funds, Title 18, United States Code, Section 641, misuse of a social security number, in violation of Title 42, United States Code, Section 408(a)(8), forged endorsement on Treasury checks, Title 18, United States Code, Section 510(a)(1), and aggravated identity theft, in violation of Title 18, United States Code, Section 1028A(a)(1). The indictment also includes a forfeiture allegation which requires the defendant to forfeit the proceeds of his fraud if convicted. If convicted, the defendant faces a significant prison sentence, fine, and restitution order, as well as forfeiture.
The indictment alleges that the defendant filed 214 false and fraudulent tax returns between January 2011 and August 2012. The bogus tax returns falsely represented that individual taxpayers had worked for various companies, earned income, had income taxes withheld from their earnings, and were entitled to income tax refunds. The defendant allegedly misused the names and social security numbers of hundreds of taxpayers in order to carry out her scheme. The 214 tax returns requested refunds of approximately $505,709, of which about $346,321 was actually refunded and released. The proceeds of the fraud were allegedly used for the defendant’s personal enrichment.
U.S. Attorney Green stated: “My office will continue to devote the resources necessary to pursue fraudsters engaged in tax fraud and identity theft, and we look forward to continuing to work with our partners at IRS-CI and other agencies in the fight against such conduct.”
“We are pleased with the indictment returned today against Ms. Harton. The IRS will aggressively pursue individuals who use stolen Social Security numbers to file false tax returns,” said Jerome R. McDuffie, Acting Special Agent in Charge, IRS Criminal Investigation. “This case should serve as a strong warning to those who are considering similar conduct. Law enforcement will relentlessly pursue those who steal the identities of unsuspecting individuals; particularly those who are unable to protect themselves.”
This matter is being handled by the U.S. Attorney’s Office for the Middle District of Louisiana and was investigated by the Internal Revenue Service-Criminal Investigations. It is being prosecuted by Assistant United States Attorney Rene I. Salomon.
NOTE: An indictment is an accusation by the Grand Jury. The defendant is presumed innocent until and unless adjudicated guilty at trial or through a guilty plea.
Six Defendants Charged with Conspiracy and Providing Material Support to TerroristsRead the Press Release
Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Richard Callahan of the Eastern District of Missouri and Special Agent in Charge William P. Woods of the FBI’s St. Louis Division announced that a federal indictment was unsealed earlier today charging six individuals with terrorist related crimes. Charged in the indictment are: Ramiz Zijad Hodzic, 40, his wife Sedina Unkic Hodzic, 35, and Armin Harcevic, 37, all of St. Louis County, Missouri; Nihad Rosic, 26, of Utica, New York; Mediha Medy Salkicevic, 34 of Schiller Park, Illinois; and Jasminka Ramic, 42, of Rockford, Illinois. All defendants are charged with conspiring to provide material support and resources to terrorists, and with providing material support to terrorists. Ramiz Zijad Hodzic and Nihad Rosic are also charged with conspiring to kill and maim persons in a foreign country.
All six individuals are natives of Bosnia who immigrated to the United States. Three have become naturalized citizens of the United States and the remaining three have either refugee or legal resident status. Five of the defendants are in the United States and have been arrested. A sixth defendant is overseas.
If convicted, the crimes of conspiring to provide material support and providing material support carry penalties ranging up to 15 years imprisonment for each count and/or fines up to $250,000. The crime of conspiring to kill and maim persons in a foreign country carries a penalty of up to life in prison. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
“Today’s charges and arrests underscore our resolve to identify, thwart, and hold accountable individuals within the United States who seek to provide material support to terrorists and terrorist organizations operating in Syria and Iraq,” said Assistant Attorney General Carlin. “Preventing the provision of supplies, money, and personnel to foreign terrorist organizations like ISIL remains a top priority of the National Security Division and our partners in the law enforcement and intelligence communities. I want to thank the many agents, analysts and prosecutors responsible for this case.”
“The indictment unsealed today epitomizes the FBI's commitment to disrupting and holding accountable those who seek to provide material support to terrorists and terrorist organizations,” said Special Agent in Charge Woods. “This case underscores the clear need for continued vigilance in rooting out those who seek to join or aid terrorist groups that threaten our national security.”
This case was investigated by the St. Louis FBI’s Joint Terrorism Task Force, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), U.S. Postal Inspection Service, St. Louis Metropolitan and St. Louis County Police Departments, with assistance from multiple law enforcement agencies. The case is being prosecuted by Assistant U.S. Attorneys Matthew Drake, Howard Marcus and Kenneth Tihen of the Eastern District of Missouri and Mara Kohn, a Trial Attorney in the Counterterrorism Section of the Department of Justice.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
Indictment
Six Bosnian Natives Charged with Providing Material Support to TerroristsRead the Press Release
St. Louis, MO – The United States Attorney’s Office for the Eastern District of Missouri announced that a federal indictment was unsealed earlier today charging six individuals with terrorist related crimes. Charged in the indictment are: RAMIZ ZIJAD HODZIC, his wife SEDINA UNKIC HODZI and ARMIN HARCEVIC, all of St. Louis County, Missouri; NIHAD ROSIC of Utica, New York; MEDIHA MEDY SALKICEVIC of Schiller Park, Illinois; and JASMINKA RAMIC of Rockford, Illinois. All defendants are charged with conspiring to provide material support and resources to terrorists, and with providing material support to terrorists. Ramiz Zijad Hodzic and Nihad Rosic are also charged with conspiring to kill and maim persons in a foreign country.
All six individuals are natives of Bosnia who immigrated to the United States. Three had become naturalized citizens of the United States and the remaining three have either refugee or legal resident status. Five of the defendants are in the United States and have been arrested. A sixth defendant is overseas. Defendants Ramiz Hodzic and Sedina Hodzic made their initial appearance before a federal magistrate in St. Louis early this evening.
If convicted, the crimes of conspiring to provide material support carry penalties ranging up to 15 years imprisonment for each count and/or fines up to $250,000. The crime of conspiring to kill and maim persons in a foreign country carries a penalty of up to life in prison. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
"The indictment unsealed today epitomizes the FBI's commitment to disrupting and holding accountable those who seek to provide material support to terrorists and terrorist organizations," said Special Agent in Charge Woods. "This case underscores the clear need for continued vigilance in rooting out those who seek to join or aid terrorist groups that threaten our national security."
This case was investigated by the St. Louis FBI’s Joint Terrorism Task Force, U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), U. S. Postal Inspection Service, St. Louis Metropolitan and St. Louis County Police Departments, with assistance from multiple law enforcement agencies. The case is being prosecuted by Assistant U.S. Attorneys Matthew Drake, Howard Marcus and Kenneth Tihen of the Eastern District of Missouri and Mara Kohn, a Trial Attorney in the Counterterrorism Section of the Department of Justice.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
INDICTMENT
Second Ocean Shipping Executive Pleads Guilty to Price Fixing on Ocean Shipping Services for Cars and TrucksRead the Press Release
A former executive of Japan-based Kawasaki Kisen Kaisha Ltd. (K-Line) pleaded guilty today and was sentenced to 14 months in a U.S. prison for his involvement in a conspiracy to fix prices, allocate customers and rig bids of international ocean shipping services for roll-on, roll-off cargo, such as cars and trucks, to and from the United States and elsewhere, the Department of Justice announced today.
According to the one-count felony charge filed in U.S. District Court for the District of Maryland in Baltimore on Dec. 29, 2014, Takashi Yamaguchi, who was a general manager and executive officer in K-Line’s car carrier division, conspired to allocate customers and routes, rig bids and fix prices for the sale of international ocean shipments of roll-on, roll-off cargo to and from the United States and elsewhere, including the Port of Baltimore. Yamaguchi participated in the conspiracy from at least as early as July 2006 until at least April 2010.
Roll-on, roll-off cargo is non-containerized cargo that can be both rolled onto and off of an ocean-going vessel. Examples of this cargo include new and used cars and trucks and construction and agricultural equipment.
“Today’s sentencing is another step in our efforts to hold executives accountable for raising the cost of shipping cars, trucks and other equipment to and from the United States,” said Bill Baer, Assistant Attorney General for the Antitrust Division. “We will continue to pursue the corporations and executives whose illegal agreements have harmed American consumers.”
Pursuant to the plea agreement, which was accepted by the court today, Yamaguchi was sentenced to serve a 14-month prison term and pay a $20,000 criminal fine for his participation in the conspiracy. In addition, Yamaguchi has agreed to assist the department in its ongoing investigation into the ocean shipping industry.
Yamaguchi was charged with a violation of the Sherman Act, which carries a maximum sentence of 10 years in prison and a $1 million criminal fine for an individual. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
Today’s sentence is the second imposed against an individual in the division’s ocean shipping investigation. Previously, three corporations have agreed to plead guilty and to pay criminal fines totaling more than $136 million, including Yamaguchi’s employer K-Line, which was sentenced to pay a criminal fine of $67.7 million in November 2014. Another K-Line executive was sentenced one week ago by the court in Baltimore.
Today’s plea agreement is the result of an ongoing federal antitrust investigation into price fixing, bid rigging and other anticompetitive conduct in the international roll-on, roll-off ocean shipping industry, which is being conducted by the Antitrust Division’s Washington Criminal I Section and the FBI’s Baltimore Field Office, along with assistance from the U.S. Customs and Border Protection Office of Internal Affairs, Washington Field Office/Special Investigations Unit. Anyone with information in connection with this investigation is urged to call the Antitrust Division’s Washington Criminal I Section at 202-307-6694, visit www.justice.gov/atr/contact/newcase.html or call the FBI’s Baltimore Field Office at 410-265-8080.
Renewal Escapee Sentenced to 18 More Months in PrisonRead the Press Release
PITTSBURGH - A local man has been sentenced in federal court to 18 months imprisonment to be served consecutive to the defendant’s other federal sentence, and followed by three years supervised release, on his conviction of escape, United States Attorney David J. Hickton announced today.
United States District Judge Terrence F. McVerry imposed the sentence on Termaine R. Washington, 25, of Pittsburgh, Pa.
According to information presented to the court, Washington was charged with escape on April 8, 2014. Washington had been transferred to the Renewal, Inc. Residential Re-entry Center located in Pittsburgh, PA. On April 8, 2014, Washington left Renewal, Inc. and did not return.
Assistant United States Attorney Shardul S. Desai prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the United States Marshals Service for the investigation leading to the successful prosecution of Washington.
Randallstown Man Sentenced to 11 Years in Prison in Baltimore Heroin Distribution ConspiracyRead the Press Release
Baltimore, Maryland – Chief U.S. District Judge Catherine C. Blake sentenced Sean Wilson, age 46, of Randallstown, Maryland today to 11 years in prison followed by five years of supervised release for conspiracy to distribute and possess with the 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; Commissioner Anthony W. Batts of the Baltimore Police Department; Chief James W. Johnson of the Baltimore County Police Department; and Baltimore City State’s Attorney Marilyn J. Mosby.
“The sentence today of Sean Wilson emphasizes the proactive work that the Drug Enforcement Administration and our law enforcement partners undertake every day to stop the flow of drugs from entering the Baltimore metropolitan area,” stated Gary Tuggle, Assistant Special Agent in Charge of the Drug Enforcement Administration, Baltimore District Office. “This case was a multi-jurisdictional operation which targeted a large scale Drug Trafficking Organization (DTO) with direct ties from Mexico to Baltimore. The tentacles of this DTO spread near and far. DEA’s investigation of this DTO was a long-term, highly complex effort that could not have been accomplished without the assistance of our local partners.”
According to his plea agreement, from at least September 2013 to June 30, 2014, Wilson conspired with Fred Brooks and others to distribute heroin in Baltimore. DEA investigators in New Orleans, Louisiana and Baltimore identified Wilson as a heroin distributor in Baltimore supplied by Brooks.
Wilson coordinated with Brooks to obtain heroin from a Mexican source of supply. Wislon distributed the heroin to co-conspirators in Maryland by way of Chicago, Illinois. The heroin arrived in the Chicago area in car batteries containing approximately four to five kilograms of heroin. Maryland-based members of the conspiracy traveled to the Chicago area to retrieve the heroin. Chicago-based members of the conspiracy traveled to Maryland to deliver the heroin and retrieve money for prior heroin deals. Some of these transactions were coordinated by Brooks and Wilson.
Law enforcement intercepted phone calls and text messages in which Wilson discussed payment for drugs and arranged drug transactions with co-conspirators. After learning that a money transaction would be occurring on June 30, 2014, law enforcement located a stash location in Pikesville, Maryland that was used by the conspirators. Investigators saw Wilson enter the stash location and leave a short time later. Later that day, law enforcement executed search warrants and seized 10 kilograms of heroin, a money counter, and $464,283 from the stash location; and $74,980 and a hydraulic press used to package heroin from Wilson’s residence
During the course of the conspiracy, Wilson was responsible for the distribution of at least 30 kilograms of heroin.
Fred Douglas Brooks, age 47, of Houston, Texas, is facing federal drug charges in New Orleans.
United States Attorney Rod J. Rosenstein praised the DEA, Baltimore Police Department; Baltimore County Police Department and Baltimore City State’s Attorney’s Office for their work in the investigation. Mr. Rosenstein thanked Special Assistant U.S. Attorney Christopher Flagg, a cross-designated Baltimore City Assistant State’s Attorney assigned as part of the Baltimore initiative to combat violent crime, and Assistant U.S. Attorney A. David Copperthite, who prosecuted this Organized Crime Drug Enforcement Task Force case.
Pike County Man Pleads Guilty to Receiving and Distributing Child PornographyRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a Dingman’s Ferry man pleaded guilty today before U.S. District Court Judge Malachy E. Mannion in Scranton, to receiving and distributing child pornography.
According to United States Attorney Peter Smith, the defendant, Daniel Decker, age 29, admitted that he used a computer between January 2, 2015 and January 20, 2015, to obtain and distribute images of young children engaged in sexually explicit conduct.
Decker was charged in an Information filed by the United States Attorney on February 2, 2015. The charge resulted from an investigation by the Federal Bureau of Investigation and the Lackawanna County District Attorney’s Office.
Decker faces a mandatory minimum sentence of five years in prison and a potential maximum sentence of 20 years in prison. A sentencing date will be scheduled after the completion of a pre-sentence investigation report.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Assistant U.S. Attorney Francis P. Sempa is prosecuting the case.
Owners of Tax Preparation Business Convicted on All CountsRead the Press Release
The owners of a tax preparation business that filed fraudulent tax returns on behalf of inmates at various New Jersey prisons were convicted at trial today of conspiracy, mail fraud and making false claims to the United States for payment of fraudulent tax refunds, U.S. Attorney Paul J. Fishman of the District of New Jersey and Principal Deputy Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division announced.
Kamal J. James, aka Bro Messiah Aziz El, of Seaford, Delaware, and Crystal G. Hawkins, aka Sis. Crystal Gabri El, of Laurel, Delaware, had each been charged in a superseding indictment with one count of conspiracy, 16 counts of making false claims for income tax refunds and three counts of mail fraud. They were convicted on all counts following a one-week trial before U.S. District Judge Peter G. Sheridan in federal court in Trenton, New Jersey. The jury deliberated one hour before returning the guilty verdicts.
According to the superseding indictment and the evidence at trial:
Between October 2011 and October 2013, defendants James and Hawkins operated Release Refunds, a purported tax preparation business – previously based in Brick, New Jersey, and in Seaford, Delaware – through which they solicited current and former New Jersey prison inmates as clients and then filed fraudulent tax returns on their behalf.
James and Hawkins sent Release Refunds “promotional” flyers to inmates at various New Jersey prisons and halfway houses offering tax return preparation services. The pair asked inmates interested in Release Refunds’ services to provide basic identification information and to sign income tax returns and other Internal Revenue Service (IRS) documents, but not to include any information about their income or withholdings. James and Hawkins then filled in the missing income information on the return forms, fabricating the inmates’ earnings to trigger fraudulent and inflated refunds.
During the course of the investigation, an undercover IRS-Criminal Investigation agent posing as an inmate in a New Jersey prison submitted a completed Release Refunds form and sent it to James and Hawkins. They then sent the “inmate” blank income tax forms and other IRS documents and instructions to sign the documents. James and Hawkins did not request any financial information from the undercover agent before preparing three fraudulent tax returns – including false income information that James and Hawkins provided – to be filed on behalf of the agent for tax years 2010 through 2012. The fraudulent returns resulted in several thousand dollars in refunds and a $1,485 fee claimed by the defendants.
The conspiracy count carries a statutory maximum sentence of 10 years in prison. The fraudulent claims counts each carry a statutory maximum sentence of five years in prison and the mail fraud counts each carry a statutory maximum sentence of 20 years in prison. The defendants also face a fine of $250,000, or twice the amount of the gain or loss from the offense, for each count of conviction. Sentencing is scheduled for May 11.
U.S. Attorney Fishman and Principal Deputy Assistant Attorney General Ciraolo credited special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Jonathan D. Larsen, with the investigation leading to today’s charges. They also thanked the U.S. Postal Inspection Service, under the direction of Postal Inspector in Charge Maria L. Kelokates, and the New Jersey Department of Corrections, under the direction of Commissioner Gary M. Lanigan, for their roles in the case.
The government is represented by Assistant U.S. Attorney Nicholas P. Grippo of the U.S. Attorney’s Office Criminal Division in Trenton and Trial Attorney Thomas Jaworski of the Tax Division.
Owners of Tax Preparation Business Convicted on All CountsRead the Press Release
TRENTON, N.J. – The owners of a tax preparation business that filed fraudulent tax returns on behalf of inmates at various New Jersey prisons were convicted at trial today of conspiracy, mail fraud and making false claims to the United States for payment of fraudulent tax refunds, U.S. Attorney Paul J. Fishman and Principal Deputy Assistant Attorney General Caroline D. Ciraolo announced.
Kamal J. James, aka “Bro Messiah Aziz El,” of Seaford, Delaware, and Crystal G. Hawkins, aka “Sis. Crystal Gabri El,” of Laurel, Delaware, had each been charged in a superseding indictment with one count of conspiracy, 16 counts of false claims and three counts of mail fraud. They were convicted on all counts following a one-week trial before U.S. District Judge Peter G. Sheridan in Trenton federal court. The jury deliberated one hour before returning the guilty verdicts.
According to the superseding indictment and the evidence at trial:
Between October 2011 and October 2013, defendants James and Hawkins operated Release Refunds, a purported tax preparation business – previously based in Brick, New Jersey, and in Seaford, Delaware – through which they solicited current and former New Jersey prison inmates as clients and then filed fraudulent tax returns on their behalf. The company is no longer in business.
James and Hawkins sent Release Refunds “promotional” flyers to inmates at various New Jersey prisons and halfway houses offering tax return preparation services. The pair asked inmates interested in Release Refunds’ services to provide basic identification information and to sign income tax returns and other IRS documents, but not to include any information about their income or withholdings. James and Hawkins then filled in the missing income information on the return forms, fabricating the inmates’ earnings to trigger fraudulent and inflated refunds.
During the course of the investigation, an undercover IRS-Criminal Investigation agent posing as an inmate in a New Jersey prison submitted a completed Release Refunds form and sent it to James and Hawkins. They then sent the “inmate” blank income tax forms and other IRS documents and instructions to sign the documents. James and Hawkins did not request any financial information from the undercover agent before preparing three fraudulent tax returns – including false income information that James and Hawkins provided – to be filed on behalf of the agent for tax years 2010 through 2012. The fraudulent returns resulted in several thousand dollars in refunds and a $1,485 fee for the defendants.
The conspiracy count carries a maximum potential penalty of 10 years in prison. The fraudulent claims counts each carry a maximum potential penalty of five years in prison and the mail fraud counts each carry a maximum potential penalty of 20 years in prison. The defendants also face a fine of $250,000 or twice the amount of the gain or loss from the offense for each count of conviction. Sentencing is scheduled for May 11, 2015.
U.S. Attorney Fishman and Principal Deputy Assistant Attorney General Ciraolo credited special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Jonathan D. Larsen, with the investigation leading to today’s charges. They also thanked the U.S. Postal Inspection Service, under the direction of Postal Inspector in Charge Maria L. Kelokates; and the N.J. Department of Corrections, under the direction of Commissioner Gary M. Lanigan, for their roles in the case.
The government is represented by Assistant U.S. Attorney Nicholas P. Grippo of the U.S. Attorney’s Office Criminal Division in Trenton and Trial Attorney Thomas Jaworski of the Justice Department’s Tax Division.
15-050Defense counsel: James: Pro se; (Bruce Throckmorton Esq., Trenton, standby counsel)
Hawkins: Pro se; (Andrea Bergman Esq. Assistant Federal Public Defender, Trenton, standby counsel)
Owner of Food Product and Supply Business Sentenced for Failing to Pay More Than $200,000 in Employment TaxesRead the Press Release
United States Attorney Andrew M. Luger today announced the sentencing of PEGGY EISCHENS, 45, to one year and one day in federal prison for failing to pay more than $200,000 in employment taxes. EISCHENS pleaded guilty on October 14, 2014, to one count of Willful Failure to Pay Over Taxes. She was sentenced on February 4, 2015, before Judge Michael J. Davis in U.S. District Court in Minneapolis, Minn.
According to the defendant’s guilty plea and documents filed in court, from 2002 through 2011, EISCHENS was a co-owner and employee of R.D. Hanson Associates, Inc. (“RDHA”), which conducted business under the names Kernel Pops of Minnesota and Kernel Concession Supply. During her employment, EISCHENS was responsible for handling payroll and accounting for RDHA, which included the preparation of employee paychecks and the preparation and filing of Form 941 quarterly tax returns with the IRS.
According to her guilty plea and documents filed in court, from 2003 through December 2011, EISCHENS willfully failed to pay over to the IRS federal income taxes and Federal Insurance Contribution Act (“FICA”) taxes, meaning Social Security and Medicare taxes, deducted and collected from the wages of RDHA employees. In total, EISCHENS failed to pay over approximately $201,285 of withheld federal income taxes, withheld FICA taxes, and the employer’s share of FICA taxes.
This case is the result of an investigation conducted by the Internal Revenue Service-Criminal Investigations.
Assistant U.S. Attorney Joseph H. Thompson prosecuted the case.
Defendant Information: PEGGY EISCHENS, 45
LeSueur, Minn.
Convicted: • Willful Failure to Pay Over Taxes, 1 count
Sentenced: • 1 year and 1 day in prison
• 3 years supervised releaseOwner and Director of Eden Prairie Daycare Center Pleads Guilty to Theft of Public MoneyRead the Press Release
United States Attorney Andrew M. Luger today announced the guilty plea of KHADRA ABDISAFAD HIRSI, 47, for stealing money in the form of child care subsidies from the U.S. Department of Health and Human Services and the State of Minnesota. The defendant pleaded guilty on February 4, 2015, before Judge Donovan W. Frank in U.S. District Court in St. Paul, Minn., to one count of Theft of Public Money.
According to her guilty plea and documents filed in court, HIRSI was the director and co-owner of Ace DayCare Center, Inc. (Ace DayCare) located in Eden Prairie, Minn. Many of the families for whom Ace DayCare provided childcare services participated in the Child Care Assistance Program, which provides low-income families with childcare assistance. HIRSI was responsible for submitting truthful and accurate billing forms for childcare services provided by Ace DayCare to families participating in the Child Care Assistance Program. Under the Child Care Assistance Program, child-daycare providers submit billing forms for reimbursement directly to the counties where qualifying families reside.
According to her guilty plea and documents filed in court, in February and March of 2013, HIRSI knowingly submitted Child Care Assistance Program billing forms that falsely inflated the number of children who received childcare services provided by Ace DayCare. As a result, HIRSI fraudulently obtained approximately $20,000 from the U.S. Department of Health and Human Services and the State of Minnesota for childcare services that were not actually provided.
"With our partners, we are aggressively targeting child care providers who try to collect payments from public programs for services they don't provide," said Minnesota Department of Human Services Inspector General Jerry Kerber, whose office oversees fraud prevention and detection efforts for state public assistance programs. "The seriousness of this crime is underscored by the fact that more than 6,100 Minnesota families are waiting to receive child care assistance."
This case is the result of an investigation conducted by the Federal Bureau of Investigation and the U.S. Department of Health and Human Services – Office of Inspector General.
U.S. Attorney Luger thanked the Minnesota Department of Human Services for their assistance.
Assistant U.S. Attorney John E. Kokkinen is prosecuting the case.
Defendant Information: KHADRA ABDISAFAD HIRSI, 47
Eden Prairie, Minn.
Convicted: • Theft of Public Money, 1 countNotice of HearingRead the Press Release
Contact Person: Beth Drake (803) 929-3000
Charleston, South Carolina ---- A plea and sentencing hearing has been scheduled in connection with United States v. Dorothy Barnett, a case involving International Parental Kidnapping and False Statements in a Passport Application. United States District Court Judge Richard M. Gergel will preside over the proceedings as indicated below.Northampton County, Pennsylvania, Man Charged with Downloading Images of Child Sexual AbuseRead the Press Release
NEWARK, N.J. – A Northampton County, Pennsylvania, man was arrested at his home this morning for allegedly downloading multiple images and videos of child sexual abuse, U.S. Attorney Paul J. Fishman announced.
Derrick Baer, 32, of Bath, Pennsylvania, and formerly of Pohatcong, New Jersey, is charged by complaint with one count of receiving child pornography and one count of possessing child pornography. He is scheduled to make his initial court appearance later today before U.S. Magistrate Judge Cathy L. Waldor in Newark federal court.
According to documents filed in this case and statements made in court:
In May 2010, in connection with an investigation into a suspicious death at Baer’s residence, law enforcement obtained Baer’s consent to seize computer equipment in his residence. A subsequent forensic review of that equipment made pursuant to a search warrant revealed 368 images and 29 video files of child pornography. Law enforcement later determined that Baer used a file sharing program to download multiple files in January and February 2009.
The receipt of child pornography count with which Baer is charged is punishable by a maximum potential penalty of 20 years in prison, a minimum penalty of five years in prison, and a fine of $250,000. The possession count is punishable by a maximum potential sentence of 10 years in prison.
U.S. Attorney Fishman credited special agents of the FBI’s Child Exploitation Task Force, under the direction of Acting Special Agent in Charge Eric Welling in Newark; the Pohatcong Township Police Department, under the direction of Chief Jeffrey S. Greenemeir; and the Warren County Prosecutor’s Office, under the direction of Prosecutor Richard T. Burke, with the investigation leading to today’s arrest.
The government is represented by Assistant U.S. Attorney David W. Feder of the U.S. Attorney’s Office Criminal Division in Newark.
The charges and allegations contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
15-049
Nigerian National Pleads Guilty to Fraud Charges in International Conspiracy CaseRead the Press Release
Gulfport, Miss – Teslim Olarewaju Kiriji, 30, a Nigerian national and one of eighteen defendants indicted in a nine-count federal indictment filed in the Southern District of Mississippi, entered a guilty plea today before U.S. District Judge Sul Ozerden to conspiracy to commit laundering of monetary instruments, announced U.S. Attorney Gregory K. Davis.
Kiriji faces a maximum penalty of twenty years in federal prison and a $500,000 fine or twice the value of the property involved. Kiriji admitted to being part of an international organization involved in multiple on-line fraud schemes which included the use of victims’ personal identification, banking and credit information.
The indictment alleges that a West African transnational organized criminal enterprise was involved in numerous complex financial fraud schemes over the internet. This mass marketing fraud included romance scams, reshipping scams, fraudulent check scams, and work-at-home scams along with bank, financial and credit card account take-overs.
The investigation was initiated in October, 2011, by Homeland Security Investigations ("HSI") agents in Gulfport after U.S. law enforcement officers were contacted by a female victim in Mississippi who was the victim of a sweetheart scam. The victim received a package in the mail requesting that she reship the merchandise to an address in Pretoria, South Africa. The investigation later revealed that the merchandise was purchased using stolen personal identity information and fraudulent credit card information of persons in the United States. Investigators have identified thousands of victims of this scam in the United States, resulting in the loss of millions of U.S. dollars.
The indictment in this case is the result of an investigation led by the HSI Gulfport office in partnership with the U.S. Postal Inspection Service, South African Police Service, Toronto
Police, HSI Cyber Crimes Center, Treasury Executive Office of Asset Forfeiture, HSI Ontario, HSI Charleston, Interpol South Africa, HSI Pretoria and HSI Atlanta.
The case in Mississippi is prosecuted by Assistant U.S. Attorneys Annette Williams and Scott Gilbert along with Robert Tully of the Organized Crime Gang Section of the Department of Justice.
Mortgage Fraud Ringleader, Mortgage Broker, and Title Agent Sentenced in Multi-Million Dollar Fraud SchemeRead the Press Release
Orlando, Florida – United States District Court Judge John A. Jarvey today sentenced James Fidel Sotolongo (49, Port Orange), Stephanie Musselwhite (52, Daytona Beach), and Christopher Mencis (53, Longwood) for their respective roles in a mortgage fraud scheme. Sotolongo was sentenced to eight years and four months in federal prison, Musselwhite received a sentence of five years’ imprisonment, and Mencis was sentenced to two years and four months in prison. They were also ordered to pay restitution, joint and severally, totaling $12,543,246 to JP Morgan Chase ($9,350,932), Wells Fargo ($1,640,467), and Bank of America ($1,551,847).
Sotolongo, Musselwhite, and Mencis were indicted on April 24, 2013. On February 4, 2014, Mencis, a mortgage broker, pleaded guilty to making false statements to a federally insured financial institution. A federal jury found Sotolongo and Musselwhite guilty on April 29, 2014. Sotolongo was convicted of one count of conspiracy and eleven counts of bank fraud. Musselwhite, a title agent in Orlando, was found guilty of one count of conspiracy, nine counts of bank fraud, and one count of making false statements to a federally insured financial institution.
According to evidence presented at trial, Sotolongo and Musselwhite were part of a scheme that recruited straw buyers with high credit scores to apply for and obtain 11 mortgages (first and second mortgages were obtained) totaling more than $12 million. The purpose of the scheme was to obtain the properties with no money down and no money at closings, rent the properties, and then sell them for a profit. To carry out the plan, Sotolongo enlisted the straw buyers and told them that they did not need to bring a deposit or cash to the closing, and that they only needed to be involved in the loan application process. The straw buyers testified that the loan applications submitted in their names contained false information, including the use of the property as a primary residence, their income, their assets, and their liabilities. Other false information included grossly inflated checking and savings account balances.
Mencis prepared the loan applications and submitted them through his brokerage company, Real Estate Mortgage Professionals (REMP). REMP has since gone out of business. He also used a former bank branch manager at SunTrust bank, at the direction of Sotolongo, to falsely verify the incomes and assets for the straw buyers. The loan applications were then sent off to several lenders, all of whom testified that they would not have funded the loans had they known that the information contained in the loan applications was false or grossly inflated.
After the loans were approved, Musselwhite prepared settlement statements listing closing costs and payments to a company called American Signature Homes, which was partly owned by Sotolongo. Musselwhite, who owned Orlando Title and Abstract of Florida, Inc., would wire lender money to American Signature Homes, and Sotolongo would use a portion of the lender money to finance the deposit and closing costs that Musselwhite would collect after the closings. The banks did not know that they were actually funding 100% of the loans on the multi-million dollar homes.
This case was investigated by the Federal Bureau of Investigation, the Florida Department of Financial Services, and the City of Daytona Beach Shores Department of Public Safety. It was prosecuted by Assistant United States Attorney Shawn P. Napier.
Mission Man Sentenced for Assault by Striking, Beating and WoundingRead the Press Release
United States Attorney Brendan V. Johnson announced that a Mission, South Dakota, man convicted of Assault by Striking, Beating, and Wounding was sentenced on February 5, 2015, by U.S. Magistrate Judge Mark A. Moreno.
Joseph Lambert, age 27, was sentenced to 12 months of probation and a special assessment of $25 to the Federal Crime Victims Fund.
Lambert was indicted by a federal grand jury on May 13, 2014. He pled guilty on December 5, 2014.
The conviction stems from an incident on April 23, 2014, when Lambert had an argument with his girlfriend and the mother of his two children. While arguing, the victim threw a cup at Lambert and Lambert grabbed the victim from behind, wrapped his arms around her upper body, and assaulted her. The victim bit his arm, he released her and she fled the residence.
This case was investigated by the Rosebud Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Tim Maher prosecuted the case.
Mission Man Sentenced for Assault by Striking, Beating and WoundingRead the Press Release
United States Attorney Brendan V. Johnson announced that a Mission, South Dakota, man convicted of Assault by Striking, Beating, and Wounding was sentenced on February 5, 2015, by U.S. Magistrate Judge Mark A. Moreno.
Joseph Lambert, age 27, was sentenced to 12 months of probation and a special assessment of $25 to the Federal Crime Victims Fund.
Lambert was indicted by a federal grand jury on May 13, 2014. He pled guilty on December 5, 2014.
The conviction stems from an incident on April 23, 2014, when Lambert had an argument with his girlfriend and the mother of his two children. While arguing, the victim threw a cup at Lambert and Lambert grabbed the victim from behind, wrapped his arms around her upper body, and assaulted her. The victim bit his arm, he released her and she fled the residence.
This case was investigated by the Rosebud Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Tim Maher prosecuted the case.
Mexican National Indicted for Illegal ReentryRead the Press Release
U.S. Attorney Kenneth A. Polite announced that NAZARIO HERNANDEZ-MALDONADO, age 53, from Mexico, was charged today in a one-count Indictment with illegal reentry into the United States after having been previously deported.
According to the indictment, on January 23, 2015, Immigration and Customs Enforcement agents encountered HERNANDEZ-MALDONADO in Lafourche. Records showed he had been previously deported from the United States to Mexico on both August 8, 1998, and July 1, 2000.
If convicted, HERNANDEZ-MALDONADO faces a maximum term of two years imprisonment, a maximum fine of $250,000, a maximum term of supervised release of one year, and a mandatory $100 special assessment.
U. S. Attorney Polite reiterated that an Indictment is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
U.S. Attorney Polite praised the work of the Immigration and Customs Enforcement and the Lafourche Parish Sheriff’s Department in investigating this matter. Assistant U.S. Attorney Rick Veters is in charge of the prosecution.
Merritt Island Man Sentenced to Life in Federal Prison for Child Exploitation OffensesRead the Press Release
Orlando, Florida – Senior United States District Judge John Antoon, II today sentenced Michael Glenn Glascock (39, Merritt Island) to life in federal prison for attempted online sexual enticement of a minor. He was also sentenced to a concurrent term of 30 years for sexual exploitation of a minor for the purpose of producing child pornography. Glascock pleaded guilty on August 18, 2014.
According to court documents, from October 11, 2012, through October 11, 2013, Glascock used a three-year-old victim to produce visual depictions of the child engaging in sexually explicit conduct. In the fall of 2013, an undercover agent with the Brevard County Sheriff’s Office responded to an online advertisement that Glascock had posted on Craigslist. The agent communicated with Glascock over the Internet and by cell phone. During these conversations, Glascock described his sexual abuse of the minor victim and expressed an interest in meeting the agent and the agent’s fictitious minor daughter. Glascock further expressed a desire to meet and engage in illegal sexual activity with the fictitious child, and he offered to allow the agent to engage in sexual activity with the minor victim. After finalizing plans to meet, agents went to Glascock’s home, where they met him and located the minor victim. The victim was taken to a medical facility and examined for sexual assault. Subsequent laboratory tests revealed the presence of Glascock’s semen on the child’s body, as well as in the child’s diaper.
During an interview with agents, Glascock admitted to producing pornographic images of the minor victim, to sexually abusing the minor as depicted in some of the images, and to distributing and receiving images of child pornography over the Internet. Agents executed a search warrant at Glascock’s home and recovered his cell phones, SD cards, and the digital camera that he had used to produce some of the explicit images involving the minor victim. A forensic examination of these devices revealed that there were 24 images depicting explicit sexual conduct involving the minor victim on one of the SD cards.
Agents also searched Glascock’s email accounts and discovered explicit images of the minor victim that Glascock had sent to another individual. In these and other emails, Glascock had numerous discussions about his sexual abuse of the minor victim. In a series of emails discovered by agents, Glascock, and an individual identified to be Jonathan Tyler Prive, discussed an incident where Prive sexually abused the minor victim at Glascock’s home, as Glascock watched the abuse. A subsequent investigation led to Prive’s arrest. He pleaded guilty to attempted enticement of a minor on August 27, 2014, and is scheduled to be sentenced on February 27, 2015.
“This sadistic criminal has preyed on the most vulnerable members of our society, our children, and this sentencing underscores the serious consequences of those crimes,” said Susan L. McCormick, special agent in charge of HSI Tampa. “HSI, and our law enforcement partners, like the Brevard County Sheriff’s Office, will not rest in our efforts to protect our youth and communities from predators like this.”
This case was investigated by the Brevard County Sheriff’s Office and U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). It was prosecuted by Assistant United States Attorney Andrew C. Searle.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.jutice.gov/psc.
Medtronic Inc. to Pay $2.8 Million to Resolve False Claims Act Allegations Related to "SubQ Stimulation" ProceduresRead the Press Release
Medical device manufacturer Medtronic Inc. has agreed to pay the United States $2.8 million to resolve allegations under the False Claims Act that Medtronic caused certain physicians to submit false claims to federal health care programs for a medical procedure known as “SubQ stimulation,” the Justice Department announced today. Medtronic Inc. is a medical technology company based in Minnesota.
“Today’s settlement demonstrates our commitment to ensure that beneficiaries of federal health care plans, including Medicare recipients and military families, receive medical treatments that have been proven safe and effective,” said Acting Assistant Attorney General Joyce R. Branda of the Justice Department’s Civil Division. “Targeting chronic pain patients with a medical procedure that lacks evidence of clinical efficacy wastes the country’s health care resources.”
The United States alleged that from 2007 through 2011, Medtronic knowingly caused dozens of physicians located throughout more than 20 states to submit claims to Medicare and TRICARE for investigational medical procedures known as SubQ stimulation that were not reimbursable. In these procedures, Medtronic’s spinal cord stimulation devices were placed just beneath the skin near an area of pain, most often in the lower back, where the devices could provide electrical impulses to create a “tingling” sensation intended to alleviate chronic pain. The United States alleged that even though the safety and efficacy of SubQ stimulation had not been established as required by the Food and Drug Administration (FDA), the company promoted this procedure by, among other strategies, arranging to have physician-customers attend Medtronic-sponsored “on-site training programs” regarding the use of Medtronic spinal cord stimulation devices for SubQ stimulation.
“Patients should be able to trust that their health care providers only use – and bill Medicare for – medical procedures that have been shown to be safe and effective,” said Special Agent in Charge Scott J. Lampert of the Department of Health and Human Services’ Office of Inspector General (HHS–OIG). “Our agency will continue to pursue medical device makers that ignore requirements designed to protect patient health and federal health care programs.”
The civil settlement resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and obtain a portion of the government’s recovery. The lawsuit was filed by Jason Nickell, who formerly worked as a Medtronic sales representative. Nickell will receive $602,000.
This settlement 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 $23.5 billion through False Claims Act cases, with more than $15 billion of that amount recovered in cases involving fraud against federal health care programs.
The settlement with Medtronic was the result of a coordinated effort among the U.S. Attorney’s Office for the Western District of New York, the Civil Division’s Commercial Litigation Branch, HHS–OIG, the Defense Health Agency, the FDA’s Office of Chief Counsel and the FDA’s Office of Criminal Investigations.
The claims resolved by this settlement are allegations only and there has been no determination of liability. The lawsuit is captioned United States ex rel. Nickel v. Medtronic, Inc. Civ. No. 09 - CV - 0203-S (W.D.N.Y.).
Longmont Man Pleads Guilty to Investment Fraud SchemeRead the Press Release
DENVER – Gary Snisky, age 48, of Longmont, Colorado, pled guilty yesterday before U.S. District Court Judge Raymond P. Moore to mail fraud and money laundering, federal authorities announced. Judge Moore is scheduled to sentence Snisky on June 18, 2015. Snisky was indicted by a federal grand jury in Denver on November 19, 2013. Snisky’s co-conspirator, Richard Greeott, plead guilty on October 7, 2013 to mail fraud and money laundering charges. Greeott is scheduled to be sentenced by Judge Phillip A. Brimmer on April 24, 2015.
According to information contained in court documents for both cases, including the plea agreements and indictment, from 2009 through 2011, Snisky operated Colony Capital in Colorado, which purported to be a private equity firm offering investment opportunities in bonds, futures trading, and other offerings. In 2011, Snisky shut down Colony Capital and formed Arete in Longmont, Colorado, which operated in a similar manner.
Beginning in late 2009, as a paid independent contractor, co-conspirator Richard Greeott began doing website development work for Colony Capital. In 2010, Snisky asked Greeott to develop a fully-automated trading system for trading in the futures market, particularly an algorithm. In 2011, Greeott believed that he had developed an algorithm for trading in the futures market that he tested in a simulated environment for several months. Eventually, Greeott began testing the algorithm by trading small amounts of money in small, but real, futures contracts. At all times, the algorithm was still in a developmental phase. At no time did anyone at Colony Capital or Arete trade a significant amount of money or make any real profit.
In 2010, Snisky falsely led investors, potential investors, and financial advisors to believe the algorithm was being used by Colony Capital, and later Arete, to profitably trade in the futures market in order to falsely bolster their appearance of success and overall financial stability. Between July 2011 and January 2013, Snisky falsely led investors, potential investors, and financial advisors to believe that they were trading “live” in the futures markets and that they had a history of trading profitably in the futures market. Also, from July of 2011 through January 2013, Snisky offered investors a “proprietary value model” which was based on using the investors’ money to purchase Ginnie Mae bonds. Throughout 2012, Snisky continued to make false assurances about the safety of investing in the Bond Program despite the fact that Snisky knew that he had not purchased any Ginnie Mae bonds as promised.
The net loss Snisky caused to investors in the bond and futures trading program was $5,226,965.93. To date, as a result of asset forfeiture proceedings, victims are in the process of being paid restitution in the amount of $2,695,913.32. The remaining amount of restitution is $2,531,052.61, most of which is jointly liable between Snisky and Greeott.
Snisky plead to one count of mail fraud, which carries a penalty of not more than 20 years in federal prison, and a fine of up to $250,000; one count of money laundering, which carries a penalty of not more than 10 years in federal prison, and a fine of up to $500,000.
This case was investigated by the Internal Revenue Service – Criminal Investigation, the Federal Bureau of Investigation, and the United States Postal Inspection Service.
This case is being prosecuted by Assistant U.S. Attorney Pegeen D. Rhyne, with Assistant U.S. Attorney Tonya Andrews is handling the forfeiture proceedings.
Lighting Contractor Sentenced to One Year in Prison for Agreeing to Bribe Broward Public OfficialRead the Press Release
A lighting contractor was sentenced today to one year and a day imprisonment for agreeing to bribe a Broward County public official.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, and George L. Piro, Special Agent in Charge, FBI, Miami Field Office, made the announcement.
William E. Pino, 60, of Miami, was sentenced before U.S. District Court Judge Beth Bloom to one year and a day in prison, followed by one year of supervised release during which the defendant is required to perform 300 hours of community service, and was ordered to pay a $25,000 fine. Pino previously pled guilty to a one-count information charging him with offering and agreeing to give something of value to a public official with the intent to influence or reward said public official in connection with a transaction or series of transactions and thereby committing bribery in programs receiving federal funds.
According to the information and the stipulated statement of facts executed by the parties and filed with the Court, Pino was involved in a number of companies in South Florida that were in the business of installing, repairing and maintaining street lights, traffic signals, and traffic systems and the sale of products needed to make such installations and repairs, such as light poles. From in or about April 2012 through on or about June 27, 2012, Pino met with a confidential informant who advised Pino that there were upcoming public works projects in Broward County for traffic systems, traffic signs, street lights and light poles. The informant advised Pino that the informant had a contact in Broward County, but that Pino would need to “take care of” the public official. Pino agreed to ?take care of? the public official.
On or about May 24, 2012, Pino was told that the public official had a purchase order for $100,000 in light poles for Pino’s company. Pino agreed to pay the public official $5,000 in exchange for the purchase order containing $100,000 of his light poles. On or about June 27, 2012, there was a meeting between Pino, the informant, and the public official in Plantation, Florida. Pino was handed a purchase order for his company to provide Broward County with $100,000 worth of light poles and Pino then handed the public official an envelope containing $5,000 in U.S. currency.
Mr. Ferrer commended the investigative efforts of the FBI. The case was prosecuted by Assistant U.S. Attorney Jeffrey N. Kaplan.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.