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27 January 2015
Alien Smuggler Pleads Guilty in Death of Two Mexican CitizensRead the Press Release
SAN DIEGO, CA – Nicholas George Zakov pleaded guilty to immigration crimes in federal court today, admitting that he acted with “extreme disregard” for the lives of two Mexican citizens who perished while being smuggled across the U.S.-Mexico border in Zakov’s trunk.
Zakov, 43, a U.S. citizen, admitted that on August 12, 2014, he attempted to transport two Mexican citizens, Tarcisio Casas-Blanco and Jose Aurelio Quiroz-Casas, into the United by hiding them within the trunk of his 2012 Dodge Challenger. Zakov was going to be paid $3,500 for his actions.
Zakov further admitted that he continued to drive the vehicle through the San Ysidro, California Port of Entry while ignoring the two Mexican citizens’ pleas to be let out of the trunk because of the extreme heat. At the Port of Entry, U.S. Customs and Border Protection officers discovered the two Mexican citizens unresponsive in Zakov’s trunk. Casas-Blanco and Quiroz-Casas later died of hyperthermia and mechanical asphyxiation.
Zokov entered his plea before U.S. Magistrate Judge David H. Bartick. He pleaded guilty to two counts of encouraging and inducing illegal aliens resulting in death and two counts of bringing illegal aliens into the United States for financial gain. According to his plea agreement, Zakov admitted that Casas-Blanco and Quiroz-Casas died as a result of being concealed in his trunk.
Zakov faces up to life imprisonment, a mandatory minimum sentence of three years in prison, and a $250,000 fine. Sentencing is scheduled for April 10, 2015 before U.S. District Judge Anthony J. Battaglia.
DEFENDANT Case Number: 14CR2363-AJB Nicholas George Zakov Age: 43 Hawthorne, California CHARGES Counts 1 and 2: Encouraging and Inducing Illegal Aliens, Aiding and Abetting, Resulting in Death, 8 U.S.C. §1324(a)(1)(A)(iv), (v)(II), and (a)(1)(B)(iv)Counts 3 and 4: Bringing in Illegal Aliens for Financial Gain, Aiding and Abetting 8 U.S.C. §1324(a)(2)(B)(ii) and 18 U.S.C. § 2
INVESTIGATING AGENCIESU.S. Customs and Border Protection
Homeland Security InvestigationsAlbuquerque Woman Sentenced for Attempted Theft from Laguna Pueblo’s Route 66 CasinoRead the Press Release
ALBUQUERQUE – Charlene Baca, 44, of Albuquerque, N.M., was sentenced today to time-served (189 days in custody) followed by three years of supervised release for her conviction for theft from an Indian gaming establishment.
Baca was arrested on Oct. 5, 2013, on a criminal complaint charging her with threatening a cashier and attempting to rob the Route 66 Casino located on Laguna Pueblo in Cibola County, N.M. According to the complaint, Baca told the cashier that she had a bomb in the casino and demanded money.
On Sept. 17, 2014, Baca entered a guilty plea to a felony information and admitted that she attempted to steal money belonging to the Route 66 Casino on Oct. 5, 2013, by suggesting to the cashier that there was a destructive device in the Casino that would explode in seconds and that she could remotely deploy the bomb if the cashier did not give her money. Baca was arrested by officers of the Pueblo of Laguna Trial Police Department shortly thereafter. No explosive device was found during the course of the investigation.
This case was investigated by the Albuquerque office of the FBI, the Laguna/Acoma Agency of the BIA’s Office of Justice Programs, the Pueblo of Laguna Pueblo Tribal Police Department, the Bernalillo County Sheriff’s Office, the New Mexico State Police and the Albuquerque Police Department. The case was prosecuted by Assistant U.S. Attorney Niki Tapia-Brito.
Albuquerque Man Pleads Guilty to Federal Commercial Robbery and Firearms ChargesRead the Press Release
ALBUQUERQUE – Gilbert Gonzales, 34, of Albuquerque, N.M., pleaded guilty today to violating the Hobbs Act and federal firearms laws. Under the terms of his plea agreement, Gonzales will be sentenced to 156 months (13 years) in federal prison followed by a term of supervised release to be determined by the court.
Gonzales was arrested in June 2013, on a criminal complaint alleging that he unlawfully possessed a firearm and ammunition on May 25, 2013, in Bernalillo County, N.M. According to the criminal complaint, an officer of the Albuquerque Police Department found a firearm and ammunition in a vehicle Gonzales was driving following a routine traffic stop. At the time, Gonzales was prohibited from possessing firearms or ammunition because he previously had been convicted of numerous felony offenses in the 2nd Judicial District Court for the State of New Mexico.
Gonzales subsequently was indicted in April 2014, in a five-count superseding indictment charging him with two counts of being a felon in possession of a firearm, one count of possession of a stolen firearm, one count of commercial robbery , and using and brandishing a firearm in relation to a crime of violence. The indictment alleged that Gonzales unlawfully possessed firearms in Bernalillo County on May 25, 2013 and June 5, 2013. It further alleged that he possessed a stolen firearm on May 25, 2013. It also alleged that Gonzales interfered with interstate commerce by robbing a commercial business at gunpoint on May 29, 2013, and brandishing a firearm at an employee of the business during the robbery.
During today’s proceedings, Gonzales pled guilty to the armed robbery of a business engaged in interstate commerce and to brandishing a firearm during the robbery. In his plea agreement, Gonzales admitted that on May 29, 2013, he obstructed interstate commerce by robbing Southwest Communications, located at 120 San Pedro SE in Albuquerque. Gonzales further admitted brandishing a firearm at an employee of that business during the armed robbery.
Gonzales has been in federal custody since his arrest and remains detained pending his sentencing hearing which has yet to be scheduled.
This case was investigated by the Albuquerque office of the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Albuquerque Police Department with assistance from the 2nd Judicial District Attorney’s Office. Assistants U.S. Attorneys David M. Walsh and Louis E. Valencia are prosecuting this case.
This case is being prosecuted as part of a federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders for federal prosecution with the goal of removing repeat offenders from communities in New Mexico for as long as possible.
Adams County Woman Sentenced to Three Years in Federal Alien Smuggling CaseRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that on January 26 Chief Judge Christopher C. Conner sentenced Martha Ortiz, 46, of Gettysburg, Pennsylvania to 36 months in prison for her participation in alien smuggling. On July 23, 2014, Ortiz pleaded guilty to bringing aliens to the United States and conspiring with her husband and others to carry out the scheme.
According to U.S. Attorney Peter Smith, in August and September 2013, Ortiz and others smuggled aliens across the United States-Mexico border by commercial aircraft, in a vehicle with a hidden compartment or “trap” to conceal their presence from law enforcement and on foot. At least two of these aliens, including a 7 year old boy, traveled from Mexico, through Texas and ultimately into Central Pennsylvania. Ortiz was paid for bringing aliens across the border. On September 24, 2013, Ortiz and her husband were stopped with tickets to Mexico City at the Harrisburg International Airport by agents from DEA and taken into custody.
This case was investigated by the Drug Enforcement Administration and is being prosecuted by Assistant United States Attorney Meredith A. Taylor.
13 Bay Area Defendants Charged in Four Separate Tax Fraud SchemesRead the Press Release
SAN FRANCISCO – The grand jury returned indictments charging 13 people in connection with four separate tax fraud schemes, announced United States Attorney Melinda Haag and Internal Revenue Service, Criminal Investigation, Special Agent in Charge José M. Martinez.
On January 6, 2015, San Francisco residents Josiah Larkin, 38, Monica Cobbins, 47, Krishell Robinson, 25, Thomalyn Virden, 51, and Ursula Choice, 28, were charged in a 32 count indictment with conspiracy to file false claims and filing false claims. According to the indictment, Larkin owned and operated a tax preparation business in San Francisco that he called Colbert Ball Tax Service. “Colbert/Ball Tax Service” is a national income tax preparation service with over 283 locations. The indictment alleges that Larkin did not have a franchise or other licensing arrangement with Colbert/Ball and used its name without authority from the company. Cobbins, Robinson, Virden, and Choice were hired by Larkin and prepared tax returns for his Colbert Ball Tax Service. Between November 2012 and August 2013, the defendants filed with the IRS, or assisted in filing, federal income tax returns falsely claiming that education expenses had been paid and the taxpayers were therefore eligible for the American Opportunity Tax Credit and a corresponding tax refund. Larkin directed that the tax refunds be paid in a manner that allowed him to control the refunds and collect his fee, which was approximately half the refund.
Cobbins made her initial appearance in federal court in San Francisco on January 21, 2015, and was released on bail set at $20,000. Larkin, Choice, and Robinson made their initial appearance in federal court in San Francisco on January 22, 2015. Larkin was released on bail set at $200,000. Choice and Robinson were released on bail set at $50,000. These defendants appeared before the Honorable Jacqueline Scott Corley, U.S. Magistrate Court Judge. Virden made her initial appearance in federal court in San Francisco on January 26, 2015, before the Honorable Joseph Spero, U.S. Magistrate Court Judge. The next scheduled appearance for Larkin, Cobbins, Choice, Robinson, and Virden is a status conference set at 2:30 on January 30, 2015, before the Honorable Susan Illston, U.S. District Court Judge.
On January 8, 2015, Jamillah Thompson, 23, of Antioch, was charged in a four count indictment with conspiracy to file false claims and wire fraud, unrelated to the conspiracy alleged in the indictment of Cobbins, Robinson, Virden, and Choice. According to the indictment charging Thompson, between January 2010 and February 2012, Thompson and others filed or helped file false claims with the IRS requesting refunds in the names of others. The indictment alleges that, as part of the scheme, Thompson procured the names and identities of taxpayers through illegal means or by agreement with participants in the scheme. The tax returns were electronically filed and included fictitious Forms W-2 to support the wages reported on the false tax returns filed.
Thompson was arrested in Antioch on January 21, 2015, and made her initial appearance in federal court the same day. Thompson was released on a $50,000 unsecured bond. Thompson appeared before the Honorable Kandis A. Westmore, U.S. Magistrate Court Judge in Oakland. Her next scheduled appearance is set for January 29, 2015.
On January 8, 2015, Kenneth Brown, 49, of Oakland, and Kenya Brown, 30, of Dublin, were charged in a nine count indictment with conspiracy to file false claims, wire fraud, theft of public money, and aggravated identity theft. Between April 2009 and June 2011, the defendants filed or help file false claims with the IRS requesting refunds in the names of others. The indictment alleges that the defendants electronically filed with the IRS or assisted in filing with the IRS false federal income tax returns using personal information obtained by illegal means. The returns falsely claimed that the people listed on the returns earned wages in amounts specified on a fictitious Form W-2 that was filed with the tax return. The defendants forged the purported filers’ electronic signature on the filed tax returns.Kenneth Brown was arrested in Oakland on January 21, 2015, and made his initial appearance in federal court the same day before Judge Westmore in Oakland. He was released on a $100,000 unsecured bond and is set to appear next at a status conference on January 30, 2015, before the Honorable Jon S. Tigar, U.S. District Court Judge. Kenya Brown has not made her initial appearance in federal court.
On January 15, 2015, Cassandra Tompkins, of Oakland, Cordia Spearman, of Vacaville, Damien Mitchell, of El Sobrante, and Tanya Keith, of Oakland, were charged in a 13 count indictment with conspiracy to file false claims. Tompkins was also charged with theft of government property, filing false claims, and aggravated identity theft. Keith was also charged with wire fraud and aggravated identity theft. Mitchell was also charged with theft of government property and aggravated identity theft. The indictment alleges that between January 15, 2011, and May 15, 2012, these defendants conspired to defraud the IRS by obtaining and aiding to obtain the payment of false claims. According to the indictment, as part of the scheme, the defendants filed or helped others file false federal income tax returns with the IRS requesting refunds. These federal income tax returns falsely reported that taxpayers earned wages in amounts specified on fictitious Forms W-2 filed with each return. The false income tax returns reported that taxes had been withheld by employers and falsely claimed refunds from the IRS.
Tompkins and Spearman made their initial appearances in federal court in Oakland on January 20, 2015, and were released on bail set at $50,000. Mitchell made her initial appearance in federal court in Oakland on January 21, 2015, and was released on bail set at $50,000. The defendants all appeared before Judge Westmore. Keith has not made her initial appearance in federal court. The next scheduled appearance for Tompkins, Spearman, and Mitchell is on March 20, 2015, before the Honorable James Donato, U.S. District Court Judge.
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. The maximum sentence for conspiracy to file false claims, in violation of 18 U.S.C § 286, is 10 years in prison and a fine of $250,000. The maximum penalty for each count of false claims, in violation of a Title 18, U.S.C § 287, is five years in prison and a fine of $250,000. The maximum penalty for theft of public money, in violation of Title 18, U.S.C § 641, is 10 years in prison and a fine of $250,000. The maximum penalty for wire fraud, in violation of Title 18, U.S.C § 1343, is 20 years in prison and a fine of $250,000. The maximum penalty for each count of identity fraud, in violation of a Title 18, U.S.C § 1028A, is two years in prison, consecutive to the underlying felony and a fine of $250,000. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Thomas Newman and Cynthia Stier are the Assistant U.S. Attorneys who are prosecuting these cases. The prosecution is the result of an investigation by the Internal Revenue Service, Criminal Investigation.
26 January 2015
Woman Sentenced to Prison for Defrauding St Albert the Great’s Parent Teacher Organization of More Than $67,000Read the Press Release
DAYTON – Jennifer Boggan, 41, of Centerville, Ohio, was sentenced in U.S. District Court to one year in prison for wire fraud, placed on three years of supervised release and ordered to make restitution in the amount of $50,464.02.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, Mark Porter, Special Agent in Charge, U.S. Secret Service, and Kettering Police Chief James M. O’Dell announced the sentence handed down today by U.S District Judge Walter H. Rice.
According to court documents, from approximately September 2010 until February 2012, Boggan served as the volunteer treasurer for St. Albert The Great Catholic School Parent Teacher Organization (PTO) in Kettering, Ohio. During that time, Boggan embezzled funds from the PTO’s bank account by a variety of methods, including preparing and endorsing checks to herself and her mother. Boggan attempted to conceal her fraudulent activities by falsely coding the checks as legitimate expenditures. She also made unauthorized cash withdrawals and purchases of gift cards from Target and the Greene Town Center using money from the PTO’s bank account.
As a result of Boggan’s scheme, she caused a loss of approximately $67,329.98 to the St. Albert PTO.
Boggan pleaded guilty on March 14, 2014 to wire fraud.“Boggan stole money raised by elementary school kids that was used to help offset the costs of school field trips, purchase teaching supplies, acquire ‘Smart Boards,’ fund scholarships and arrange for guest speakers,” Assistant U.S. Attorney Alex Sistla told the court. “Her entire tenure as the PTO’s volunteer treasurer was marked by deceit and fraud.”
U.S. Attorney Stewart commended the cooperative investigation by the Secret Service and Kettering Police Department, as well as Assistant United States Attorney Alex R. Sistla, who is representing the United States in this case.
West Jordan Woman Pleads Guilty to Using the Personal Identifiers of Deceased Individuals to Get Tax ReturnsRead the Press Release
SALT LAKE CITY - Jacquelin Boyd, aka Jacquelyn Boyd, age 37, of West Jordan, entered a guilty plea to making a false claim to the IRS in U.S. District Court Friday afternoon. Boyd admitted that from May 2, 2012, through about Oct. 13, 2012, she worked with others to obtain the names, addresses, social security numbers and other personal identifiers of deceased individuals and used the information to file false and fraudulent tax returns with the IRS.
Boyd admitted that she created false records of employers, wages, and Utah addresses to submit with the returns. She directed that the refunds, based on the fraudulent information, be deposited to various bank accounts under her control. She withdrew the money after it was deposited in the accounts.
She pled guilty to a count involving a false tax return filed on Oct. 13, 2012, in the name of A.B., who is deceased. A return of $2,444 was mailed to Boyd.
“IRS Criminal Investigation, along with our law enforcement partners and the United States Attorney's Office, continue to do our part in protecting the integrity of the tax system and those individuals whose identities were stolen, as well as recovering any monetary loss against the U.S. Treasury”, stated John G. Collins, IRS Criminal Investigation Special Agent in Charge of Utah.
The plea agreement includes a recommendation for a sentence of one year and a day, which is subject to court approval. Boyd also agreed to pay $32,243 in restitution to the IRS.
A scheduling hearing has been set for April 15, 2015, at 2:30 p.m., in Judge Tena Campbell’s courtroom.
Webb County, Texas Commissioner Sentenced to 76 Months in Prison for Accepting Bribes in Exchange for Official ActionsRead the Press Release
An elected county commissioner for Precinct 1 of the Webb County Commissioners Court in Texas was sentenced today to 76 months in prison for accepting bribes in exchange for official actions.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and Special Agent in Charge Christopher Combs of the FBI’s San Antonio Division made the announcement. U.S. District Judge Marina Garcia Marmolejo of the Southern District of Texas imposed the sentence.
Kristopher Michael Montemayor, 37, of Laredo, Texas, pleaded guilty to one count of federal programs bribery on June 19, 2014. In addition to the prison sentence, he was ordered to pay a fine of $109,405.72 and to forfeit $13,721.16.
In his plea agreement, Montemayor admitted that he solicited and accepted multiple bribes in exchange for promising to perform official acts. Specifically, Montemayor admitted that he accepted three separate bribe payments totaling $11,000 and over $2,700 in electronics and other merchandise, including two Apple iPads and two pairs of Dr. Dre Beats Solo HD headphones, from a businessman who, unbeknownst to Montemayor, was an undercover law enforcement agent. In exchange for the cash and the other items, Montemayor promised to take various forms of official action to promote the business interests of the undercover agent.
Montemayor also admitted to accepting a 2012 Ford F-150 pick-up truck, worth approximately $37,000, in exchange for providing government jobs to the vehicle owner and his spouse. As a result of these appointments, the vehicle owner and his wife received salaries of $26,000 and $45,553 from Webb County. Montemayor admitted that the vehicle owner performed little or no work in exchange for his government salary.
The case was investigated by the Laredo Resident Agency of the FBI’s San Antonio Division. The case was prosecuted by Trial Attorneys Emily Rae Woods and Mark J. Cipolletti of the Criminal Division’s Public Integrity Section.
Virginia man sentenced on heroin chargeRead the Press Release
HUNTINGTON, W.Va. – United States Attorney Booth Goodwin announced today that Justin M. Kent, 32, of Richmond, Virginia, was sentenced to 30 months in federal prison.
Kent pleaded guilty to possession with intent to distribute heroin in October 2014. During a traffic stop on Aug. 14, 2012, members of the Huntington Violent Crime and Drug Task Force found Kent to be in possession of 10 individually wrapped packets of heroin. Kent was also involved in sales of heroin to a confidential informant on two separate occasions in May and June 2012.
Chief United States District Judge Robert C. Chambers imposed the sentence.
The case was investigated by the Huntington Violent Crime and Drug Task Force. Assistant United States Attorney Greg McVey was in charge of the prosecution.
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Two convicted of tax fraudRead the Press Release
CLARKSBURG, WEST VIRGINIA – Two West Virginia residents were convicted of tax fraud today in federal court, United States Attorney William J. Ihlenfeld, II, announced.
Connie Sue Cole, 71, of Bruceton Mills, West Virginia, ran a tax preparation service from her home. Cole repeatedly falsified tax returns by either understating the true income earned by her clients or inflating and overstating the expenses incurred by her clients to fabricate deductions. She admitted today to falsifying a specific tax return in March 2013. The client was entitled to claim business expenses in the amount of $3,682.00. Cole filed a tax return on behalf of the client fraudulently claiming nearly $36,000.00 in business expenses. Cole pled guilty today to a criminal Information charging her with one count of “Aiding and Assisting the Preparation of Fraudulent Tax Returns.” She faces up to three years in prison and a fine of up to $1,000,000.00.
Morgantown, West Virginia businessman Michael A. Vecchio, Jr., 53, of Morgantown, West Virginia, admitted today that he repeatedly misappropriated profits from his various businesses. He diverted corporate income into his personal bank accounts, used business income to pay his personal credit card debt, and used his business credit card for personal living expenses. He failed to declare any of these payments as corporate or personal income. Vecchio pled guilty today to a criminal Information charging him with one count of “Attempts to Interfere with the Administration of the Internal Revenue Laws.” He faces up to three years in prison and a fine of up to $250,000.00.
Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendants.
“Those that don’t comply with the federal tax laws, are in reality stealing from honest tax paying Americans who comply with their tax obligations,” said Guy Ficco, Assistant Special Agent in Charge of the Internal Revenue Service-Criminal Investigation, Washington, D.C. Field Office. “We should not forget that we are the ultimate victims of tax fraud.”
Assistant U.S. Attorney Andrew Cogar is prosecuting Cole and Assistant U.S. Attorney Robert McWilliams is prosecuting Vecchio on behalf of the government. The Internal Revenue Service-Criminal Investigation is leading the investigations.
U.S. Magistrate Judge John S. Kaull presided.
Two Wheeling men sentenced for cocaine traffickingRead the Press Release
WHEELING, WEST VIRGINIA – Jackie Byrd, 25, and Marisol Rodriguez, 34, both of Wheeling, were sentenced today for cocaine trafficking, United States Attorney William J. Ihlenfeld, II, announced.
An investigation by the Ohio Valley Drug and Violent Crime Task Force, a HIDTA-funded initiative, revealed that Byrd and Rodriguez sold crack cocaine in the Northern District of West Virginia throughout 2014. Additionally, Byrd stabbed a confidential informant in July 2014.
Byrd and Rodriguez each pled guilty in November 2014 to one count of “Conspiracy to Possess with Intent and to Distribute Cocaine Base.” Byrd further pled guilty to one count of “Retaliation Against a Cooperating Witness.” Byrd was sentenced today to 46 months in prison on each count. The sentences will run concurrently for a total of 46 months in prison. Rodriguez was sentenced to 6 months in prison.
Assistant U.S. Attorney Randy Bernard prosecuted the case on behalf of the government.
Senior U.S. District Judge Frederick P. Stamp presided.
Texas Man Arrested in Kansas Charged in Federal Court with KidnapingRead the Press Release
WICHITA, KAN. – A Texas man was charged with kidnapping in federal court in Wichita Monday, U.S. Attorney Barry Grissom said.
Joseph Andrew DeRusse, 24, Austin, Texas, was charged in a criminal complaint filed in U.S. District Court in Wichita.
The complaint alleges that on Jan. 23, 2015, DeRusse kidnaped a victim identified as HMM. He intended to force her to spend three weeks with him at a bed and breakfast in Narka, Kan., during which time he intended to convince her to marry him. He is alleged to have abducted her at gunpoint in Austin. He handcuffed her and blindfolded her before driving her from Texas to Kansas. It was not until later she learned that the weapon was a BB gun.
DeRusse’s car was tracked by GPS during the drive to Kansas. On Friday, the Newton Police Department used the GPS information to find his car and pull him over on northbound I-135 at milepost 41, where they freed the victim. In the car, they found an engagement ring DeRusse had purchased.
If convicted, he faces a maximum penalty of life in federal prison. The Newton Police Department and the FBI investigated. Assistant U.S. Attorney Aaron Smith is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct
Tennessee Man Convicted at Trial for Failure to Register as A Sex Offender to Serve 30 Months in Federal PrisonRead the Press Release
Follow @SDILNewsRonald Douglas, a 59-year old, Memphis, Tennessee, man was sentenced on January 23, 2015, in federal district court in East St. Louis, Illinois, for violation of the Sex Offender Notification and Registration Act, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today. Douglas was convicted by a jury following a three day trial which started on September 17, 2014. Douglas was sentenced to 30 months’ in prison. Additionally, he will serve a five year term of supervised release following service of his sentence. Douglas was also fined $250 and ordered to pay a $150 special assessment.
The violation was discovered after local officers conducting a sex offender registration compliance check on October 25, 2012, at Douglas’ registered address in Granite City, Illinois, were informed by a live-in girlfriend that Douglas had moved to Memphis, TN in September 2012. Douglas was required to register because of a June 5, 1992, conviction for Aggravated Criminal Sexual Abuse in Third Judicial Circuit Court in Madison County, Illinois. He violated federal registration requirements by crossing a state line and by failing to register or to update a registration within three days.
Further information about federal sex offender registration requirements is available here: http://www.justice.gov/criminal/ceos/citizensguide/citizensguide_sorna.html
The case was investigated by the Granite City Police Department and the United States Marshals Service. Assistant United States Attorneys’ Daniel T. Kapsak and Nathan D. Stump prosecuted the case.
Sex Offender Sentenced for Failure to RegisterRead the Press Release
The United States Attorney for the Southern District of Alabama, Kenyen R. Brown, announces that Sulayman Basim Akbar was sentenced for failing to register as a sex offender in violation of Title 18, United States Code, Section 2250A. Judge Charles R. Butler sentenced Akbar to time served imprisonment and five years supervised release. The defendant also has to pay a $100 Special Assessment.
This case was investigated by the United States Marshal’s Service. The case was prosecuted by the United States Attorney=s Office for the Southern District of Alabama, AUSA Maria E. Murphy.
Severn Man Sentenced to 25 Years in Prison for Producing Child PornographyRead the Press Release
Baltimore, Maryland – U.S. District Judge Ellen L. Hollander sentenced Darrius Carr, age 22, of Severn, today to 25 years in prison followed by a lifetime of supervised release for producing child pornography arising from his sexual assault of a toddler on March 7 and 11, 2014. Judge Hollander ordered that upon his release from prison, Carr must register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Anne Arundel County Police Chief Tim Altomare; and Anne Arundel County State’s Attorney Wes Adams.
According to his plea agreement, in March 2014, Carr did not have a place to stay. Carr moved in with a family in order to provide daycare for the couple’s young children on March 6, 2014.
The next day, while the parents were at work, Carr was alone with the children. During a four minute time span, Carr produced six photos and a video of himself and the girl engaged in sexually explicit conduct.
On March 11, 2014, Carr was again left alone with the children. Carr produced another video of himself and the victim. The video is a close up of the victim’s genitals, and during the video Carr touches her.
Additionally, since at least 2012, Carr used his email accounts, online storage accounts, and Instagram account to store and distribute child pornography. The distributed files of child pornography included more than 600 images of prepubescent minors, and videos.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc. For more information about internet safety education, please visit www.justice.gov/psc and click on the "resources" tab on the left of the page.
United States Attorney Rod J. Rosenstein commended the FBI, Anne Arundel County Police Department and Anne Arundel County State’s Attorney’s Office for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Paul E. Budlow, who prosecuted the case.
Saratoga County Man Pleads Guilty to Receipt and Possession of Child PornographyRead the Press Release
ALBANY, NEW YORK – JOHN J. TIGHE, age 57, of Milton, New York, pled guilty today in Albany before United States District Judge Thomas J. McAvoy to one count of receipt of child pornography and one count of possession of child pornography, announced United States Attorney Richard S. Hartunian and Andrew W. Vale, Special Agent in Charge of the Albany Division of the Federal Bureau of Investigation.
TIGHE faces at least 5 years and up to 20 years of imprisonment, as well as a term of supervised release of at least 5 years and up to life. He also faces a maximum fine of $250,000 and mandatory registration as a sex offender. TIGHE will be sentenced in Albany, New York on June 8, 2015.
As part of his guilty plea, TIGHE admitted that in June 2013 he knowingly received child pornography and that in October 2013 he knowingly possessed child pornography involving prepubescent minors and minors who had not attained 12 years of age.
This case was investigated by the New York State Police and the Federal Bureau of Investigation and is being prosecuted by Special Assistant United States Attorney Amanda W. Cox.
Saranac Lake, NY Fraud Scheme Nets Man 144 Month Prison TermRead the Press Release
ALBANY, NY –A Ventura, California man has been sentenced to 144 months in federal prison after admitting his participation in an $8 million investment scheme luring investors with false promises relating to the development of an alternative energy technology, announced United States Attorney Richard S. Hartunian, the United States Attorney for the Northern District of New York. This case, based out of the U.S. Attorney’s Office for the Northern District of New York, was resolved in the Central District of California as a result of a change in venue.
William A. Stehl, 70, received the following sentences from Senior United States District Judge Terry J. Hatter, Jr. in Federal Court in Los Angeles on January 21:
144 months for conspiracy to commit mail and wire fraud; 60 months for lying to federal agents; 60 months each for evading federal income taxes in 2003 and 2004; and
36 months for subscribing to a false federal income tax return in 2003.All sentences were ordered to run concurrently. Stehl was also ordered to pay $8,118,037.18 restitution to more than 300 victims of the fraud, and to serve a term of supervised release for 3 years upon his release from prison.
Stehl and a co-defendant, Richard M. Rossignol, 64, of Los Angeles, California, were arrested in Oxnard, California four years ago in connection with an indictment filed in the Northern District of New York. Both men were charged with conspiracy to commit mail and wire fraud. Additionally, Stehl was charged with several tax charges and lying to federal agents.
The conspiracy count alleged that from 2001, up to the time of the indictment in March 2010, Stehl, Rossignol, and others induced victims to invest money in companies that were purportedly developing or utilizing an alternative energy source Stehl claimed he had developed. Investors were told that one of Stehl’s applications related to the processing of precious metals, allegedly contained in a slag pile in Silver City, New Mexico.
Stehl and Rossignol were charged with fraudulently obtaining money from investors by making false representations about the status of the process, claiming that contracts and licensing agreements had either been signed, or were about to be signed, that would result in significant financial returns for the investors. Stehl, Rossignol, and others obtained more than $8 million from more than 300 victims, and attempted to obtain at least an additional $50 million. None of the investors received the returns promised by Stehl and Rossignol. Most of the money obtained was used for personal expenditures.
Stehl was living near Saranac Lake, New York, when the scheme started, and moved to Southern California in late 2005. Fraud victims lived all across the United States.
Although the indictment was originally filed in Federal Court in Binghamton, New York, in October 2012, the case was transferred to the Central District of California to accommodate Stehl, who received injuries in an explosion that occurred in a building in Sylmar, California, on August 9, 2011.
Judge Hatter ordered Stehl to surrender himself at the facility designated by the Bureau of Prisons on March 20, 2015.
Trial and Sentencing of Co-Defendant Richard Rossignol
Rossignol’s case went to trial in Los Angeles on January 14, 2014. On February 28, the jury convicted Rossignol of the sole count he faced, conspiracy to commit mail and wire fraud. On July 28, the Court sentenced Rossignol to 20 years – the maximum statutory sentence – and immediately remanded him into custody. The Court also ordered Rossignol to pay more than $8.1 million in restitution to the fraud victims, describing the fraud as being among the most egregious it had seen in 20 years.
The investigation in this case was conducted by Special Agents of the Internal Revenue Service - Criminal Investigation, New York Field Office, and the Albany, New York, Field Office of the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorney Kevin P. Dooley of the Binghamton branch office in the Northern District of New York. Additional inquiries can be directed to Marilyn Morey or Assistant United States Attorney Elizabeth Coombe at 518-431-0247.
Saranac Lake Fraud Scheme Nets Man 144 Month Prison TermRead the Press Release
ALBANY, NY –A Ventura, California man has been sentenced to 144 months in federal prison after admitting his participation in an $8 million investment scheme luring investors with false promises relating to the development of an alternative energy technology, announced United States Attorney Richard S. Hartunian, the United States Attorney for the Northern District of New York. This case, based out of the U.S. Attorney’s Office for the Northern District of New York, was resolved in the Central District of California as a result of a change in venue.
William A. Stehl
, 70, received the following sentences from Senior United States District Judge Terry J. Hatter, Jr. in Federal Court in Los Angeles on January 21:
144 months for conspiracy to commit mail and wire fraud;
60 months for lying to federal agents;
60 months each for evading federal income taxes in 2003 and 2004; and
36 months for subscribing to a false federal income tax return in 2003.
All sentences were ordered to run concurrently. Stehl was also ordered to pay $8,118,037.18 restitution to more than 300 victims of the fraud, and to serve a term of supervised release for 3 years upon his release from prison.
Stehl and a co-defendant, Richard M. Rossignol, 64, of Los Angeles, California, were arrested in Oxnard, California four years ago in connection with an indictment filed in the Northern District of New York. Both men were charged with conspiracy to commit mail and wire fraud. Additionally, Stehl was charged with several tax charges and lying to federal agents.
The conspiracy count alleged that from 2001, up to the time of the indictment in March 2010, Stehl, Rossignol, and others induced victims to invest money in companies that were purportedly developing or utilizing an alternative energy source Stehl claimed he had developed. Investors were told that one of Stehl’s applications related to the processing of precious metals, allegedly contained in a slag pile in Silver City, New Mexico.
Stehl and Rossignol were charged with fraudulently obtaining money from investors by making false representations about the status of the process, claiming that contracts and licensing agreements had either been signed, or were about to be signed, that would result in significant financial returns for the investors. Stehl, Rossignol, and others obtained more than $8 million from more than 300 victims, and attempted to obtain at least an additional $50 million. None of the investors received the returns promised by Stehl and Rossignol. Most of the money obtained was used for personal expenditures.
Stehl was living near Saranac Lake, New York, when the scheme started, and moved to Southern California in late 2005. Fraud victims lived all across the United States.
Although the indictment was originally filed in Federal Court in Binghamton, New York, in October 2012, the case was transferred to the Central District of California to accommodate Stehl, who received injuries in an explosion that occurred in a building in Sylmar, California, on August 9, 2011.
Judge Hatter ordered Stehl to surrender himself at the facility designated by the Bureau of Prisons on March 20, 2015.
Trial and Sentencing of Co-Defendant Richard Rossignol
Rossignol’s case went to trial in Los Angeles on January 14, 2014. On February 28, the jury convicted Rossignol of the sole count he faced, conspiracy to commit mail and wire fraud. On July 28, the Court sentenced Rossignol to 20 years – the maximum statutory sentence – and immediately remanded him into custody. The Court also ordered Rossignol to pay more than $8.1 million in restitution to the fraud victims, describing the fraud as being among the most egregious it had seen in 20 years.
The investigation in this case was conducted by Special Agents of the Internal Revenue Service - Criminal Investigation, New York Field Office, and the Albany, New York, Field Office of the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorney Kevin P. Dooley of the Binghamton branch office in the Northern District of New York. Additional inquiries can be directed to Marilyn Morey or Assistant United States Attorney Elizabeth Coombe at 518-431-0247.
Sacramento Man Sentenced to over 7 Years in Prison for A Mortgage Fraud Scheme in Chico and SacramentoRead the Press Release
SACRAMENTO, Calif. — Leonard E. Williams, 52, of Sacramento, was sentenced today to over seven years and three months in prison for conspiracy to commit mail and wire fraud and two counts of money laundering, in connection with a mortgage fraud scheme, United States Attorney Benjamin B. Wagner announced. Williams was found guilty on July 24, 2014, by a federal jury after a six–day trial.
At sentencing today, United States District Judge William B. Shubb stated that one of the factors he used in imposing the sentence was Williams' outburst in front of the jury during trial. On the last day of the trial, Williams began shouting at the jury about his case. Judge Shubb asked him to stop talking until the jury could be dismissed. Williams, nevertheless, continued yelling at the jury as they filed out. Today, Judge Shubb characterized the outburst as "unacceptable" and said that Williams had intended to cause a mistrial and mislead the jury about his defense.
According to evidence presented at trial, from late 2006 into 2008, Williams conspired with others to carry out a mortgage fraud scheme in the Chico and Sacramento areas using his companies Diamond Hill Financial and Bay Area Real Estate Holdings. The scheme resulted in the issuance of more than $2 million in home loans, with most of the buyers ultimately defaulting.
To carry out the scheme, Williams and his partner Joshua Clymer recruited underqualified buyers, including family and friends, to purchase homes with promises of cash back, no money down, and illusory equity in the homes. Williams and others assisted these home buyers in securing loans with fraudulent loan applications that contained lies about the buyers' employment, income, assets, and intent to occupy the homes as a primary residence. In most cases, at Williams' suggestion and encouragement, the loan applications falsely stated that the buyers worked at Diamond Hill Financial, and Williams himself maintained the charade by confirming this false information when lenders called to verify it.
The loan applications also listed false assets and were accompanied by various forged documents, which increased the amount of the loans to the buyers, which in turn increased the profits of the fraud to Williams, Clymer, and others. The profit to Williams and Clymer varied from $5,000 to over $30,000 per transaction, with the two of them often splitting the proceeds.
Prior to trial, Clymer pleaded guilty to conspiracy to commit mail and wire fraud and is scheduled to be sentenced on February 9, 2015.
This case is the product of an investigation by the Federal Bureau of Investigation; the Internal Revenue Service, Criminal Investigation; and the Butte County District Attorney's Office's Major Crimes Unit. Williams is the last of 14 defendants who have been convicted of mortgage fraud offenses in connection with this and related cases. Others who already been convicted and sentenced include William E. Baker, Shane Burreson, Christopher M. Chiavola, Carlos Chamorro, Eric Clawson, Niche Fortune, Garret Gililland, Kesha Haynie, Remy Heng, Nicole Magpusao, Brandon Resendez, and Anthony Symmes. Twelve of the defendants pleaded guilty. Juries have convicted the two defendants who went to trial, Williams and Haynie. Assistant United States Attorneys Christopher S. Hales and Audrey B. Hemesath prosecuted the case.Sacramento Defense Contractor Agrees to Pay $2 Million to Settle Allegations of Inflating CostsRead the Press Release
SACRAMENTO, Calif. — Composite Engineering Inc., a Sacramento-based subsidiary of Kratos Defense & Security Solutions that manufactures remote-controlled subscale aircraft for the U.S. military, has agreed to pay the United States $2 million to resolve allegations that it violated the False Claims Act by submitting inflated costs in connection with a 2007 contract, United States Attorney Benjamin Wagner announced today.
The contract at issue was a firm fixed-price contract modification for the procurement of spare parts to meet the requirements of the Air Force’s Subscale Aerial Target (AFSAT) program. The United States alleges that, in submitting its contract proposal, CEI knowingly or recklessly included significantly overstated materials costs and labor hours, resulting in a windfall to CEI. The False Claims Act allows the government to recover damages and penalties for the presentation of false claims for payment to the United States. By basing its contract price with the government on overstated materials and labor costs, CEI caused the United States to pay artificially inflated prices.
“In this era of shrinking budgets, it is particularly important to safeguard public coffers against the unnecessary expenditure of taxpayer funds,” said U.S. Attorney Wagner. “Ensuring the integrity of federal contracting programs is one of the objectives of this office’s Affirmative Civil Enforcement Unit, and results like this one help accomplish that objective.”
Deputy Inspector General for Investigations James B. Burch of the Department of Defense, Defense Criminal Investigative Service (DCIS) said: “Fraud directly impacts our armed services’ resources and capabilities. DCIS works closely with our federal investigative partners to identify and bring to justice those seeking to steal from the American taxpayers and harm our armed services. The results of this case will ensure troops can finish their jobs without the burden of shortages created by such opportunists.”
The settlement is the product of an investigation by DCIS, the Defense Contract Audit Agency, and the Air Force Office of Special Investigations. Assistant U.S. Attorney Colleen M. Kennedy prosecuted the case on behalf of the United States. The claims settled by this agreement are allegations only, and CEI denies liability.
Rochester Man Charged with Assaulting Mail Carrier, Brandishing FirearmRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
ROCHESTER, N.Y.-- U.S. Attorney William J. Hochul, Jr. announced today that a federal grand jury has returned an indictment charging Orlando Justice, 27, of Rochester, NY, with assaulting a U.S. Postal Service employee with a dangerous weapon, and brandishing a firearm to commit the assault. The charges carry a minimum sentence of seven years in prison, a maximum of life, and a fine of $250,000.Assistant U.S. Attorney John J. Field, who is handling the case, stated that according to the indictment, the defendant assaulted a Postal Service mail carrier while he was engaged in his official duties delivering mail in Rochester. During the assault, Justice brandished a firearm.
The indictment is the culmination of an investigation by the United States Postal Inspection Service, under the direction of Special Agent in Charge Shelly Binkowski.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
Real Estate Businessman Convicted of Tax Fraud by Concealing Income Using Nominee Entities and AliasesRead the Press Release
A federal jury sitting in Providence, Rhode Island, convicted a Cranston, Rhode Island, man of one count of corruptly endeavoring to obstruct and impede the Internal Revenue Service (IRS), one count of tax evasion and two counts of aiding and assisting in the preparation and filing of false corporate tax returns, the Justice Department and the IRS announced.
John Fall was remanded into custody after the jury verdict. Fall faces a statutory maximum sentence of 14 years in prison and a $1 million fine at his sentencing on April 28 before U.S. District Judge John J. McConnell Jr. for the District of Rhode Island.
According to the evidence presented at trial, Fall was a real estate consultant who bought, sold and brokered real estate. Fall also participated in handling the financial affairs of his wife and her businesses, including her dental practice, Comfort Dental Inc., and Broad Street Investments. Between 1999 and 2010, Fall used numerous nominee entities and business names to conceal his business and financial transactions. Fall also used multiple bank accounts, including commingled or “warehouse” bank accounts, in at least six states to conceal his financial transactions, as well as certain financial transactions of Comfort Dental and Broad Street Investments. To further disguise business and financial transactions, Fall used fake names and aliases to conceal his ownership and control over his nominee entities.
The evidence at trial proved that Fall filed false federal income tax returns for 1998 and 1999, and failed to file any tax returns for the years 2000 through 2010. The IRS audited Fall for 1998 through 2000, assessing him taxes totaling approximately $72,000.
The evidence at trial further established that Fall caused the filing of false tax returns on behalf of Comfort Dental for the years 2005 through 2007. Fall caused his wife’s businesses to make payments to his various entities which were falsely recorded on the corporate tax returns as deductible business expenses. When Comfort Dental and Fall’s wife were audited civilly by the IRS in late 2008, Fall attempted to obstruct the audit by encouraging his wife’s accountant not to provide the IRS with information requested through an IRS summons, and instead provided false and fraudulent information and documentation to the IRS concerning the nature of the payments by Comfort Dental and Broad Street Investments to his various entities. Fall also attempted to obstruct his wife’s compliance with an IRS summons.
This case was investigated by special agents with the IRS – Criminal Investigation. The case is being prosecuted by Assistant Chief John Kane and Trial Attorney Jeffrey Bender with the Justice Department’s Tax Division.
Raleigh Man Sentenced to 51 Months in Prison for Possession of a Firearm by a Convicted FelonRead the Press Release
Jackson, Miss – Octavious Burkes-Palmer, 37, of Raleigh, Mississippi, was sentenced by U.S. District Judge Daniel P. Jordan III to 51 months in federal prison followed by three years of supervised release for possession of a firearm by a convicted felon, U.S. Attorney Gregory K. Davis announced today.
Burkes-Palmer was arrested by the Scott County Sheriff’s Office on November 13, 2013 after they responded to a 911 call concerning an attempted robbery. He was later indicted by a federal grand jury for possession of a firearm by a convicted felon. He pled guilty to the charge on January 26, 2015.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and prosecuted by Assistant U.S. Attorney Jerry L. Rushing
Previously Convicted Fraudster Faces Consecutive Sentence for Failure to Report to PrisonRead the Press Release
Follow @SDILNewsKevin D. Dowell, 38, of St. Louis, Missouri, pled guilty to failure to surrender for service of a sentence the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today. Dowell faces a sentence of up to ten years in prison, a $250,000 fine and up to three years supervised release. Dowell was previously convicted of wire fraud in a scheme to defraud and embezzle from the FKG Oil Company and, in June of 2014, was sentenced to a year and a day in prison. On August 20, 2014, Dowell failed to surrender to the prison as ordered and was apprehended about a week later. If convicted of the new offense, the new sentence will have to run consecutive to the previous sentence of imprisonment. Sentencing has been scheduled for May 18, 2015.
The investigation was conducted by the United States Marshal's Service. The case is being prosecuted by Assistant United States Attorney Norman R. Smith.
Phoenix Tax Preparer Sentenced to 12 Months Imprisonment for Preparing Fraudulent Tax ReturnsRead the Press Release
PHOENIX – On Jan. 23, 2015, Margaret Nicole Hall, 40, of Phoenix, Ariz., was sentenced by U.S. District Judge David G. Campbell to 12 months and one day of imprisonment. Hall was also ordered to pay $92,937 in restitution to the Internal Revenue Service. On Oct. 20, 2014, Hall pleaded guilty to one count of obstructing or impeding the administration of internal revenue laws and one count of aiding or assisting preparation or presentment of a fraudulent or false return.
According to her plea agreement, Hall owned and operated a tax return preparation service known as Taxes R Us which was located in Phoenix, Ariz. During an Internal Revenue Service civil audit proceeding, Hall falsely represented that this client received income from self-employment and that the client received tip income. Hall also knowingly provided fabricated lease documents and fabricated rental receipts to the Internal Revenue Service as purported substantiation for items claimed in the false tax returns that Hall had prepared for her client.
Additionally, Hall prepared a Federal income tax return that fraudulently stated the taxpayer's purported wages, purported business income, and tips.
The investigation in this case was conducted by the Internal Revenue Service Criminal Investigation. The prosecution was handled by Frank Galati, Assistant U.S. Attorney, District of Arizona, Phoenix.
CASE NUMBER: CR-14-00418-PHX-DGC
RELEASE NUMBER: 2015-007_Hall
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For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
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Owner of Miami Home Health Company Sentenced to 106 Months in Prison for $30 Million Health Care Fraud SchemeRead the Press Release
The owner and operator of a Miami home health care agency was sentenced today to 106 months in prison for his participation in a $30 million Medicare fraud scheme.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office and Special Agent in Charge Derrick Jackson of the U.S. Department of Health and Human Services-Office of Inspector General’s (HHS-OIG) Miami Regional Office made the announcement.
Ramon Regueira, 66, of Miami, pleaded guilty to one count of conspiracy to commit health care fraud on Nov. 13, 2014. In addition to the prison sentence, U.S. District Judge Cecilia M. Altonaga of the Southern District of Florida ordered Regueira to pay $21 million in restitution, both jointly and severally with his co-conspirator.
According to his plea agreement, Regueira was an owner of Nation’s Best Care Home Health Corp. (Nation’s Best), a Miami home health care agency that purported to provide home health and therapy services to Medicare beneficiaries. Regueira admitted that he and his co-conspirators operated Nation’s Best for the purpose of billing the Medicare program for, among other things, expensive physical therapy and home health care services that were not medically necessary or not provided.
Specifically, Regueira admitted that he and his co-conspirators paid kickbacks and bribes to patient recruiters who provided patients to Nation’s Best, as well as prescriptions, plans of care (POCs) and certifications for medically unnecessary therapy and home health services. Regueira and his co-conspirators then used these prescriptions, POCs and medical certifications to fraudulently bill the Medicare program for unnecessary home health care services.
From January 2007 through January 2011, Nation’s Best submitted approximately $30 million in claims for home health services that were not medically necessary or not provided, and Medicare paid approximately $21 million for these fraudulent claims.
The case was investigated by the FBI and 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 Southern District of Florida. This case is being prosecuted by Assistant Chief Joseph S. Beemsterboer and Trial Attorney Kelly Graves 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 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.
Orlando Man Sentenced to 17 Years for Armed RobberiesRead the Press Release
Orlando, FL – Senior United States District Judge John Antoon, II has sentenced Joe E. Clinton, Jr. (23, Orlando) to 17 years in federal prison for aiding and abetting the attempted robbery of a Walgreen’s store, the robbery of a CVS store, and using and carrying a firearm during those violent crimes. Clinton pleaded guilty on March 24, 2014.
According to court documents and evidence presented during the trial of Clinton’s co-conspirator, Jacques Maddox, on the night of September 2, 2013, Clinton and Maddox went to the Walgreen’s store on South Kirkman Road near Universal Studios. After surveilling the store for hours, they walked into the store for the final time around 11:00 p.m. Maddox acted as a lookout near the center of the store, while Clinton forced the store manager inside an office at gunpoint. Clinton demanded that the manager open the store’s safe, threatening to shoot him if he failed to do so. When the manager refused to comply with Clinton’s demands, Clinton pistol whipped him, striking him several times in the head and shoulders. Clinton then ran out of the office, met up with Maddox in the middle of the store, and pulled his gun on other employees and store customers as he and Maddox fled the scene.
On the night of September 10, 2013, Clinton walked into the CVS store located at 1201 East Colonial Drive, in Orlando. He took a beverage from the cooler and brought it to the front counter. As the clerk tried to ring up the purchase, Clinton pulled out his handgun, pointed it at the clerk, and demanded that she open the register. The clerk gave Clinton all of the cash from the register; he then fled from the store.
Clinton admitted to committing a series of additional armed commercial robberies in Central Florida before being captured by police in Dothan, Alabama, on October 1, 2013.On July 9, 2014, a federal jury found Maddox guilty of aiding and abetting the attempted Walgreen’s robbery. He was subsequently sentenced to six years and six months in federal prison.
This case was investigated by the Federal Bureau of Investigation, the Bureau of Alcohol, Tobacco, Firearms, and Explosives, and the Orlando Police Department. It was prosecuted by Assistant United States Attorney Joseph M. Schuster.
Ocala Man Sentenced to Prison for Methamphetamine Lab in Ocala National ForestRead the Press Release
Ocala, Florida – Senior U.S. District Judge Wm. Terrell Hodges has sentenced Charles Michael Curry, Jr. (50, Ocala) to 30 months in federal prison for possession with intent to distribute methamphetamine. He pleaded guilty to the charge in November 2014.
According to court documents, on August 9, 2014, United States Forest Service officers responded to the Ocala National Forest based on complaints that individuals had been illegally manufacturing methamphetamine there. Upon arrival, officers found a campsite occupied by Curry and two other individuals. Curry initially fled from the officers, but was quickly apprehended. Subsequently, he directed the officers to his makeshift methamphetamine laboratory, where they found approximately 155 grams of a mixture and substance containing methamphetamine. Curry ultimately admitted that he had been manufacturing the methamphetamine with the intent to distribute it. Officers also recovered drug paraphernalia in the immediate area.
This case was investigated by the United States Forest Service and the Lake County Sheriff’s Office. It was prosecuted by Assistant United States Attorney Robert E. Bodnar, Jr.
Oakland Man Pleads Guilty to Counterfeit Media Scheme in FresnoRead the Press Release
FRESNO, Calif. — Emilio Perez-Solis, 39, of Oakland, pleaded guilty today to conspiring to commit criminal copyright infringement and traffic in counterfeit labels, documentation and packaging, United States Attorney Benjamin B. Wagner announced.
According to court documents, Perez-Solis used a building in a rural area of Fresno as a distribution point for counterfeit CDs and counterfeit DVDs. From the building, Perez-Solis sold counterfeit CDs and DVDs, including movies that were only in theatrical release and not yet available on DVD. On February 21, 2014, the building was searched and found to contain approximately 70,000 counterfeit music CDs and movie DVDs.
This case is the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) with assistance from the Fresno County Sheriff’s Office. Assistant United States Attorneys Henry Z. Carbajal III and Patrick R. Delahunty are prosecuting the case.
Perez-Solis is currently in custody, and is scheduled to be sentenced by Judge Lawrence J. O'Neill on April 20, 2015. Perez-Solis faces a maximum statutory penalty of five years in prison and a $250,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
Notice of HearingRead the Press Release
September 29, 2014Contact Person: Beth Drake (803) 929-3000
Charleston, South Carolina ---- An Initial Appearance 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 Magistrate Judge Bristow Marchant will preside over the proceedings as indicated below.
September 29, 2014, 1:30 p.m. 83 Meeting St. Charleston, SC 29401 Courtroom TBDNinth Circuit Affirms Former Nevada Lobbyist’s Conviction for Making Unlawful Campaign ContributionsRead the Press Release
The U.S. Court of Appeals for the Ninth Circuit today affirmed the convictions of a former Nevada lobbyist for making excessive campaign contributions and contributions in the name of another person, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Daniel G. Bogden of the District of Nevada.
“We're pleased that today's decision confirms that the cornerstones of our campaign finance laws - contribution limits and transparency - are not subject to creative misinterpretations of those determined to break the law,” said Assistant Attorney General Caldwell.
“Harvey Whittemore knew the law, he knew how to raise money the right way, he knew right from wrong, and he knew how he could violate the law and avoid detection,” said U.S. Attorney Bogden. “He made a conscious and willful choice to violate federal elections laws in order to increase his own power and influence at the expense of the voting public and the election process.”
F. Harvey Whittemore, 62, of Reno, Nevada, a prominent Nevada lawyer, former lobbyist and land developer, was convicted by a jury in the District of Nevada in May 2013 of making excessive campaign contributions, making contributions in others’ names, and causing a materially false statement to be made to the Federal Election Commission (FEC). He was sentenced on Sept. 30, 2013, to two years in prison and a $100,000 fine.
According to evidence presented at trial, Whittemore was aware of the strict limits on individual federal campaign contributions. In an effort to circumvent those limits, he devised a scheme to unlawfully funnel more than $130,000 of his own money through approximately 29 family members, employees and their spouses to the campaign committee for a U.S. senator. This scheme allowed Whittemore to make an individual campaign donation in excess of the federal limits. Whittemore concealed the scheme from the FEC, the senator, and the senator’s campaign committee.
The case was investigated by the FBI and prosecuted by Deputy Chief Eric G. Olshan of the Criminal Division’s Public Integrity Section and First Assistant U.S. Attorney Steven W. Myhre of the District of Nevada. Appellate Chief and Assistant U.S. Attorney Elizabeth Olson White of the District of Nevada argued the appeal.
Ninth Circuit Affirms Former Lobbyist's Conviction for Making Unlawful Campaign ContributionsRead the Press Release
WASHINGTON - The U.S. Court of Appeals for the Ninth Circuit today affirmed the convictions of a former Nevada lobbyist for making excessive campaign contributions and contributions in the name of another person, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Daniel G. Bogden of the District of Nevada.
“We're pleased that today's decision confirms that the cornerstones of our campaign finance laws - contribution limits and transparency - are not subject to creative misinterpretations of those determined to break the law,” said Assistant Attorney General Caldwell.
“Harvey Whittemore knew the law, he knew how to raise money the right way, he knew right from wrong, and he knew how he could violate the law and avoid detection,” said U.S. Attorney Bogden. “He made a conscious and willful choice to violate federal elections laws in order to increase his own power and influence at the expense of the voting public and the election process.”
F. Harvey Whittemore, 62, of Reno, Nevada, a prominent Nevada lawyer, former lobbyist and land developer, was convicted by a jury in the District of Nevada in May 2013 of making excessive campaign contributions, making contributions in others’ names, and causing a materially false statement to be made to the Federal Election Commission (FEC). He was sentenced on Sept. 30, 2013, to two years in prison and a $100,000 fine.
According to evidence presented at trial, Whittemore was aware of the strict limits on individual federal campaign contributions. In an effort to circumvent those limits, he devised a scheme to unlawfully funnel more than $130,000 of his own money through approximately 29 family members, employees and their spouses to the campaign committee for a U.S. senator. This scheme allowed Whittemore to make an individual campaign donation in excess of the federal limits. Whittemore concealed the scheme from the FEC, the senator, and the senator’s campaign committee.
The case was investigated by the FBI and prosecuted by Deputy Chief Eric G. Olshan of the Criminal Division’s Public Integrity Section and First Assistant U.S. Attorney Steven W. Myhre of the District of Nevada. Appellate Chief and Assistant U.S. Attorney Elizabeth Olson White of the District of Nevada argued the appeal.Nifty Fifty's Accountant Pleads Guilty to Tax Fraud SchemeRead the Press Release
William J. Frio, 58, of Springfield Township, pleaded guilty today to his role in a tax evasion scheme involving the Nifty Fifty’s restaurant chain. Frio pleaded guilty to conspiracy to commit tax evasion. Frio is the sixth defendant to plead guilty in the long-running scheme to avoid paying millions of dollars in personal and employment taxes, by failing to properly account for more than $15 million in gross receipts, thereby evading federal taxes of over $2.28 million. Frio also pleaded guilty to filing his own false tax returns, aggravated structuring of financial transactions, and loan fraud. U.S. District Court Judge Mary McLaughlin scheduled a sentencing hearing for April 29, 2015.
Frio, an accountant and income tax preparer who provided services to the Nifty Fifty’s organization since 1986, conspired with the owners and principals of Nifty Fifty’s. The defendants skimmed cash to pay themselves, their employees, and people and businesses who supplied goods and services to the Nifty Fifty’s restaurants, providing those persons and businesses with the opportunity to evade the payment of their own taxes.
In 2008, Frio submitted a false loan application to Sovereign Bank for a $417,000 mortgage for his personal residence. Frio submitted to the bank bogus federal income tax returns for 2006 and 2007, and bogus Forms W-2, falsely representing he had earned substantial income from Tanfasia, Inc. The 2006 and 2007 tax returns that he had actually submitted to the IRS showed far less income than the false returns supplied to Sovereign Bank, and Frio had not been employed by Tanfasia, Inc. in 2006 or 2007.
Frio also used his position as the Nifty Fifty’s accountant to embezzle over $4 million of funds that belonged to the organization. As part of that scheme, between 2006 and 2009, Frio knowingly structured cash transactions totaling over $2.6 million out of Nifty Fifty’s accounts at Sovereign Bank.
Frio faces a maximum possible sentence of 57 years in prison, full restitution to the IRS, a fine of up to $2.75 million, and criminal forfeiture.
The case was investigated by the Internal Revenue Service Criminal Investigations and the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorneys Paul G. Shapiro and Nancy E. Potts.
New York Man Involved in Danbury Home Invasion Drug Robberies Sentenced to 7 Years in PrisonRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that on Friday, January 23, SCOTT MYRIE, also known as “Venom,” 27, of Bedford Hills, N.Y., was sentenced by U.S. District Judge Stefan R. Underhill in Bridgeport to 84 months of imprisonment, followed by three years of supervised release, for his participation in two Danbury-area violent home invasion robberies of illegal drugs and drug trafficking proceeds.
According to court documents and statements made in court, in January 2013 the Danbury Police Department began investigating a narcotics trafficking network that maintained a series of drug distribution locations, known as trap houses, in Danbury, out of which members of the organization sold crack and heroin. The organization also rented hotel rooms where they packaged and distributed narcotics. During the investigation, law enforcement learned that the individuals who headed the drug trafficking ring had organized and committed armed home invasion robberies of marijuana dealers.
MYRIE participated in home invasion robberies on January 30 and February 18, 2013. During both of these robberies, and a third robbery in which MYRIE did not participate, several men wearing masks and armed with firearms forced entry into the residence of a known marijuana dealer. Once inside, the perpetrators attempted to or did steal marijuana and cash. In each instance, the perpetrators pistol whipped a victim and threatened to kill others within the home.
MYRIE was armed with a .32 caliber handgun during both of the robberies in which he participated, and children were present in both homes. During the robbery on February 18, MYRIE struck a male victim in the head with the handgun repeatedly before dropping the gun during a struggle. Investigators subsequently recovered the gun and found that it was fully loaded.
MYRIE has been detained since his arrest on October 16, 2013. On August 22, 2014, he pleaded guilty to one count of interference with commerce by robbery and one count of attempted interference with commerce by robbery.
This matter has been investigated by the Drug Enforcement Administration’s New Haven Task Force and the Danbury Police Department. The DEA Task Force includes personnel from the New Haven, Hamden, West Haven, North Haven, Branford, Ansonia and Meriden Police Departments. The case is being prosecuted by Assistant U.S. Attorneys Tracy Dayton and Vanessa Richards.
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(203) 821-3722 [email protected]New York Man Convicted of Sex Trafficking of MinorsRead the Press Release
Follow @USAO_CTDeirdre M. Daly, United States Attorney for the District of Connecticut, and Patricia M. Ferrick, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, announced that a jury in Hartford has found EDWARD THOMAS, also known as “Fire,” 40, of New York, guilty of the sex trafficking of minors. The trial before U.S. District Judge Robert N. Chatigny began on January 15.
According to the evidence at trial, in September 2012, THOMAS, a New York-based pimp, answered an Internet prostitution advertisement for a 17-year-old girl (“MV1”) in Oregon. Over the next month, THOMAS recruited and enticed MV1 to travel to New York to work for him. MV1 eventually agreed and traveled to New York with a second girl (“MV2”), who was 16 at the time, using bus tickets purchased by THOMAS. THOMAS discussed with both MV1 and MV2 that they would be prostituting for him in New York and Connecticut.
After MV1 and MV2 arrived in New York, THOMAS and the two minor girls went immediately to a hotel in Milford, Connecticut, where they met Kayla Walters, THOMAS’ co-defendant, and posted prostitution advertisements. THOMAS knew that MV1 and MV2 were under the age of 18. In Milford, MV1 and MV2 saw customers for commercial sex acts at the direction of THOMAS. While MV2 escaped from a hotel room window after several hours, MV1 continued to work for THOMAS for about a month, turning over all of the money she earned in prostitution to THOMAS. When MV1 attempted to leave, THOMAS forcibly restrained her. Ultimately, MV1 was recovered for the first time by the FBI and local police in Milford on November 8, 2012. Law enforcement seized nearly $4,000 in cash from THOMAS during the first recovery, along with several computers and cellular phones.
THOMAS recruited MV1 a second time in July 2013 and again paid for her travel from Oregon to the East Coast. After THOMAS sent Walters and MV1 to Connecticut to make money for him, the FBI and local police again recovered MV1 from a hotel in Milford.
“This defendant preyed on the vulnerabilities of two girls whom he lured 3000 miles away from their homes,” stated U.S. Attorney Daly. “The U.S. Attorney Office is committed to prosecuting individuals who manipulate minors into committing sexual acts – often under the threat of violence – and profit handsomely from this illegal and reprehensible conduct. I thank the FBI for their vigilance in investigating these crimes, which have resulted not only in criminal convictions, but in the rescue of numerous girls and young women from terrible environments.”
“Human trafficking, especially for the purpose of underage prostitution, is a heinous crime,” stated FBI Special Agent in Charge Ferrick. “The FBI will continue to work with our law enforcement partners to aggressively pursue these criminals and hold them accountable.”
THOMAS was convicted of one count of conspiracy to commit sex trafficking of a minor and two counts of sex trafficking of a minor. Judge Chatigny scheduled sentenced for April 17, 2015, at which time THOMAS faces a mandatory minimum term of imprisonment of 10 years and a maximum term of imprisonment of life.
On November 10, 2014, Walters pleaded guilty to one count of conspiracy to commit sex trafficking of a minor. She awaits sentencing.
THOMAS and Walters have been detained since their arrests on February 28, 2014.
THOMAS’ criminal history includes a 2007 conviction in New Jersey for promoting prostitution with a child under the age of 18.
This matter is being investigated by the Federal Bureau of Investigation and the Connecticut Child Exploitation Task Force, which includes federal, state and local law enforcement agencies. The Stratford and Milford Police Departments have assisted the investigation.
The Connecticut Child Exploitation Task Force, which is housed at the main FBI office in New Haven, investigates crimes against children occurring over the Internet, and provides computer forensic review services for participating agencies. For more information about the Task Force, or to report child exploitation crimes, please contact the FBI at 203-777-6311.
The case is being prosecuted by Assistant U.S. Attorneys David E. Novick and Sarala V. Nagala.
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(203) 821-3722 [email protected]New York Man Admits Participating in Armed Robberies of Electronic Stores in New JerseyRead the Press Release
TRENTON, N.J. – A New York man today admitted participating in armed robberies of electronics stores in New Jersey, including armed robberies in Linden, Paramus, and Woodbridge, U.S. Attorney Paul J. Fishman announced.
Eric Williams, 34, of Brooklyn, New York, pleaded guilty before U.S. District Judge Anne E. Thompson in Trenton federal court to a superseding information that charged him with one count of conspiracy to commit Hobbs Act robberies.
Williams was arrested on Feb. 14, 2013, and charged in a superseding indictment — along with Carl Williams, 31, and Unique Randolph, 28, both of Brooklyn – in connection with several armed robberies of electronic stores in New Jersey. Eric Williams has been in custody since his arrest.
According to documents filed in this case and statements made in court: On Sept. 20, 2012, Carl Williams and Leonard Arrington, 28, of Roslyn Heights, New York, walked into a T-Mobile store in Linden brandishing a firearm, while Eric Williams and other conspirators served as lookouts and get-away drivers. Carl Williams and Arrington then tied up the employees in the back of the store, stole 50 to 60 cell phones and fled in a Land Rover. Eric Williams and other conspirators then delivered the stolen phones to a cell phone store in Brooklyn.
On Oct. 2, 2012, Arrington entered a T-Mobile store in Woodbridge, brandishing a firearm, along with another man. After locking the front door, the men took the employees to the back of the store and tied them up, then stole approximately 40 cell phones. One of the robbers then called the getaway driver, who drove them away in a Land Rover. Eric Williams and others delivered the stolen phones to the same Brooklyn store.
Eric Williams participated in the planning of a subsequent robbery of an electronics store in Paramus, which took place on Jan. 16, 2013. Randolph and another individual entered an electronics store and, after forcing employees and a customer into the back of the store, Randolph tied them up using zip-ties, while his conspirator held them at gunpoint. As Randolph and his conspirator were looting the store of cell phones, a UPS employee walked into the backroom. Randolph forced him onto the ground and used zip-ties to tie him up. Randolph and his conspirator then fled, along with Carl Williams who was waiting outside as a lookout.
The charge of conspiracy to commit Hobbs Act robberies carries a maximum potential penalty of 20 years in prison and a maximum fine of $250,000. Carl Williams, Arrington and Randolph have previously pleaded guilty.U.S. Attorney Fishman praised special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford, with the investigation leading to today’s guilty plea. He also thanked the Linden, Paramus, and Woodbridge police departments, as well as the New York City and Nassau County police departments and the Kings County District Attorney’s Office in New York for their work in this case.
The government is represented by Assistant U.S. Attorney Osmar J. Benvenuto of the U.S. Attorney’s Office Criminal Division.15-033
Defense counsel: Carl Williams: Mark A. Berman Esq., River Edge, N.J.
Eric Williams: Michael A. Armstrong Esq., Willingboro, N.J.
Unique Randolph: Damian P. Conforti Esq., Newark
Leonard Arrington: Dennis S. Cleary Esq., NewarkNaples Man Indicted for Million Dollar Internet Fraud SchemeRead the Press Release
Fort Myers, Florida – United States Attorney A. Lee Bentley, III announces the unsealing of an indictment charging Jeffrey Ihm (47, Naples) with multiple counts of wire fraud and aggravated identity theft. Each wire fraud count carries a maximum penalty of 20 years in federal prison. In addition, he faces a maximum penalty of two years’ imprisonment for each aggravated identity theft offense, to be served consecutively to any wire fraud conviction. The indictment also notifies Ihm that the United States is seeking a money judgment against him in the amount of $1,064,664.74, and intends to forfeit the house located at 3343 Pacific Drive, Naples, Florida, which are both alleged to be traceable to proceeds of the fraud.
According to the indictment, Ihm assumed the identities of and posed as three different Roper Industries, Inc. executives. He then generated false and fraudulent emails and other documents in the names of Roper Industries, Inc. and Kynetic Technologies, LLC to defraud Wells Fargo Bank, causing the bank to wire him $1,064,664.74 to which he was not entitled.
An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the United States Secret Service and the Federal Bureau of Investigation, with assistance from the Economic Crimes Unit of the Collier County Sherriff’s Office. It will be prosecuted by Assistant United States Attorneys David G. Lazarus and Dale R. Campion.
Montana Welcomes Bryan Garner for Tribal Court TrainingRead the Press Release
BILLINGS -- America’s foremost authority of training in legal writing, editing, and drafting, Bryan Garner, will be in Billings, Montana on January 26, 2015, for a legal writing workshop for tribal court judges and practitioners. The event is sponsored by the Bureau of Indian Affairs Tribal Court Services and hosted by the District of Montana’s United States Attorney’s Office. The Montana Department of Justice Office of Consumer Protection and Victim Services is a cosponsor of the event.
Garner is editor in chief of Black’s Law Dictionary and the author of many leading works on legal style, including A Dictionary of Modern Legal Usage, The Elements of Legal Style, The Redbook: A Manual on Legal Style, The Winning Brief, and The Winning Oral Argument. His latest books are Making Your Case: The Art of Persuading Judges, co-written with Justice Antonin Scalia, and Garner on Language and Writing, an anthology published by the American Bar Association.
"The United States Attorney=s Office is pleased to welcome Mr. Bryan Garner to Montana for this training,” said Montana U.S. Attorney Mike Cotter. “We are excited to have a tribal court training that features the highest caliber of trainers. In addition to welcoming tribal court practitioners from Montana, we welcome our out of state tribal court practitioners to Billings for this unique opportunity to advance writing skills.”
"As part of the Office of Indian Affairs' commitment to provide exceptional tribal court training, the BIA is excited to collaborate with the United States Attorney's Office for the District of Montana and the Montana Attorney General's Office," said Assistant Secretary for Indian Affairs Kevin K. Washburn. "This collaboration insures that tribal courts will receive first class training because Indian people deserve first rate justice."
Fifty applicants, representing five states and 18 different tribes and tribally connected entities, have been accepted for this event. Bureau of Indian Affairs intends to offer two more national trainings featuring Garner in other venues, in the future.
Mexican National Sentenced to 15 Years for Participating in a Brutal Family Run Sex Trafficking OrganizationRead the Press Release
The Department of Justice today announced a sentencing and guilty plea for two members of a family run sex trafficking organization based in southern Florida. Rafael Alberto Cadena-Sosa was sentenced by U.S. District Court Judge Joes E. Martinez to serve 15 years in prison and Carmen Cadena pleaded guilty before U.S. District Court Judge Jose Martinez for participating in a brutal family run sex trafficking organization.
Rafael Alberto Cadena-Sosa
Cadena-Sosa, 46, a Mexican national, was sentenced to serve 15 years in prison for conspiring and holding a person in a condition of involuntary servitude. Judge Martinez also ordered Cadena-Sosa to pay $1,261,563 in restitution to sixteen different victims.
On Oct. 9, 2014, Cadena-Sosa pleaded guilty to conspiracy and to holding a person in a condition of involuntary servitude. As part of his plea, Cadena-Sosa admitted that he, along with other family members and associates, approached women and girls, some as young as fourteen years old, in Veracruz, Mexico, and lured them into coming to the United States using false promises of legitimate jobs. After illegally smuggling women and girls into the United States, Cadena-Sosa and other family members imposed a smuggling debt and used brutal physical force and violence, sexual assaults, and threats of death and bodily harm to the victims and their families to compel the victims to engage in prostitution 12 hours a day, six days a week and turn over the proceeds to the defendants to pay down the smuggling debts the defendants imposed. Cadena-Sosa and other family members would also search for victims who had run away from a brothel and subject them to beatings and rapes upon capture.
Carmen Cadena
Cadena, 48, a Mexican national, pleaded guilty to one count of conspiracy for conspiring with other members of the Cadena organization to unlawfully encourage and bring undocumented victims into the U.S.; unlawfully transport victims within the U.S.; unlawfully harbor victims within the U.S.; unlawfully coerce and transport victims, including victims as young as 14-years-old, into the U.S. for purposes of illegal sexual activity; and unlawfully use extortionate means to collect extensions of credit made to the victims.
Cadena faces a maximum sentence of five years in prison and a fine of $500,000. Sentencing is scheduled to occur on May 18, 2015. According to the terms of the plea agreement, the parties will jointly recommend the maximum sentence of five years in prison and $1,261,563 in restitution to 16 victims.
Sixteen defendants were charged in a superseding indictment filed in 1998. Mexican authorities arrested Rafael Alberto Cadena-Sosa and Carmen Cadena and extradited them to the United States in November 2013 and December 2014, respectively. Four other members of the Cadena sex trafficking organization have been convicted, including Cadena-Sosa’s uncle, Rogerio Cadena, who pleaded guilty in 1999 and was sentenced to 15 years; Cadena-Sosa’s brother, Abel Cadena-Sosa, who was convicted in Mexico and sentenced to 24 years, and two other brothers, Hugo and Juan Luis Cadena-Sosa—Carmen Cadena’s husband—, who pleaded guilty in 2002 and 2008, and were sentenced to five years and 15 years respectively. Six other defendants previously pleaded guilty in federal court in connection with the scheme, and one was convicted in state court for a murder outside a Cadena-run brothel.
Since 2009, the Departments of Justice and Homeland Security as well as law enforcement agencies in Mexico, have worked to develop high-impact prosecutions to dismantle human trafficking networks operating across the U.S.-Mexico border, bring human traffickers to justice, restore the rights and dignity of human trafficking victims, and reunite victims with their children held under the trafficking networks’ control. These efforts have resulted in numerous successful prosecutions, including U.S. federal prosecutions of over 50 defendants in multiple cases in Georgia, New York, Florida, and Texas since 2009.
“No human being should have to endure the violence and brutality these young women and girls suffered at the hands of the Cadena organization,” said Acting Assistant Attorney General Vanita Gupta for the Civil Rights Division. “These violations of the victims’ individual rights and freedom are intolerable and the Department of Justice will continue in its commitment to bringing human traffickers to justice and restore the rights and dignity of the courageous survivors of this crime.”
“Rafael Cadena-Sosa and Carmen Cadena preyed on vulnerable girls and young women and lured them to the United States with the promise of a better life,” said U.S. Attorney Wilfredo A. Ferrer for the Southern District of Florida. “Instead, Cadena-Sosa and his family and associates robbed these victims of their freedom and dignity, brutally beat them and subjected them to modern-day slavery. The dismantling of the Cadena organization reaffirms our unwavering commitment to prosecute those who seek to profit at the expense of the suffering of to others. We will continue to work with our domestic and international law enforcement partners to bring justice to those who engage in this inhumane practice. This case is one example of bilateral progress to effectively dismantle human trafficking networks operating across the U.S.-Mexico border.”
“The long prison sentence imposed upon Rafael Alberto Cadena-Sosa is a testament to the cooperation and commitment of numerous law enforcement agencies both here and in Mexico to stop this appalling criminal activity,” said Special Agent in Charge George L. Piro of the FBI Miami Office. “We will continue working with our partners to dismantle human trafficking networks such as this one that operate in the shadows and brutalize their victims.”
Acting Assistant Attorney General Gupta and U.S. Attorney Ferrer praised the collaborative efforts of multiple law enforcement agencies throughout the investigation and prosecution, including the Federal Bureau of Investigation, the Department of Homeland Security’s Customs and Border Protection and Immigration and Customs Enforcement, the Bureau of Alcohol, Tobacco and Firearms, the Office of International Affairs, Criminal Division, U.S. Department of Justice, Florida Department of Law Enforcement, Palm Beach County Sheriff’s Office, West Palm Beach Police Department, Okeechobee County Sheriff’s Office, Fort Pierce Police Department, Avon Park Police Department, Boynton Beach Police Department, and Lee County Sheriff’s Office. The case is being prosecuted by Assistant United States Attorney Adam McMichael and Trial Attorney Matthew Grady of the Civil Rights Division’s Human Trafficking Prosecution Unit.
Members of Drug Organization IndictedRead the Press Release
BATON ROUGE, LA - United States Attorney Walt Green announced today the unsealing of a federal grand jury indictment in Operation Drop the Hammer, an extensive investigation into a drug trafficking network operating in the Baton Rouge and Denham Springs area.
The investigation is another effort by the Organized Crime Drug Enforcement Task Force (OCDETF) Program which was established in 1982 to mount a comprehensive attack against organized drug traffickers. Today, the OCDETF Program is the centerpiece of the United States Attorney General’s drug strategy to reduce the availability of drugs by disrupting and dismantling major drug trafficking organizations and money laundering organizations and related criminal enterprises. The OCDETF Program operates nationwide and combines the resources and unique expertise of numerous federal, state, and local agencies in a coordinated attack against major drug trafficking and money laundering organizations.
The following nine individuals have been charged:
- Darryl Q. Cobb, also known as “Hammer Bob” and “Hammer,” age 33, of Baton Rouge, Louisiana, is charged with conspiracy to distribute and possess with the intent to distribute cocaine and cocaine base; distribution of cocaine and cocaine base; possession with the intent to distribute cocaine; unlawful use of a communications facility; and forfeiture.
- Tabari A. Wilkerson, also known as “T,” age 37, of Baton Rouge, Louisiana, is charged with conspiracy to distribute and possess with the intent to distribute cocaine and cocaine base; distribution of cocaine; unlawful use of a communications facility; and forfeiture.
- Morgan M. Dillon, also known as “Mo,” age 33, of Baton Rouge, Louisiana, is charged with conspiracy to distribute and possess with the intent to distribute cocaine and cocaine base; distribution of cocaine base; possession with the intent to distribute cocaine; unlawful use of a communications facility; and forfeiture.
- Thurman Ray Morris, age 57, of Denham Springs, Louisiana, is charged with conspiracy to distribute and possess with the intent to distribute cocaine and cocaine base; distribution of cocaine base; unlawful use of a communications facility; and forfeiture.
- Gerald Norwood Cobb, age 63, of Denham Springs, Louisiana, is charged with conspiracy to distribute and possess with the intent to distribute cocaine and cocaine base; distribution of cocaine base; unlawful use of a communications facility; and forfeiture.
- Lashonda Desiree Cobb, age 31, of Denham Springs, Louisiana, is charged with conspiracy to distribute and possess with the intent to distribute cocaine and cocaine base; unlawful use of a communications facility; and forfeiture.
- Dequincy M. Conley, also known as “Dee Dee,” age 39, of Baton Rouge, Louisiana, is charged with conspiracy to distribute and possess with the intent to distribute cocaine and cocaine base and forfeiture.
- Troy Lee Albert, also known as “Shine,” age 32, of Albany, Louisiana, is charged with conspiracy to distribute and possess with the intent to distribute cocaine and cocaine base and forfeiture.
- Shabass J. Dantzler, age 25, of Springfield, Louisiana, is charged with unlawful use of a communications facility.
If convicted, each defendant could face significant incarceration, fines, restitution, and supervised release following imprisonment.
U.S. Attorney Green stated: “My office, together with our federal, state, and local partners, will continue to focus our energies and resources on eradicating drug trafficking organizations and the violence that comes with them. To be clear, dangerous drug dealers will find no safe haven within the federal criminal justice system. I greatly appreciate the hardworking team of agents and prosecutors for their tireless efforts during this important operation. In particular, I would like to recognize the tremendous contribution of the late Officer James E. Foster, Jr., Denham Springs Police Department, who recently lost his life in the line of duty while responding to an emergency. In remembering Officer Foster, we are reminded of the sacrifices that law enforcement officers and their families make every day to ensure the safety of our community.”
Joseph Shepard, the Assistant Special Agent-in-Charge of the New Orleans Division of the U.S. Drug Enforcement Administration, stated: “Today’s indictment and arrests stand as a warning to those individuals whose greed drives them to pollute the greater Baton Rouge area with poisonous contraband. The message that law enforcement continues to send to drug dealers is, selling drugs will bring an end to your freedom. DEA and our other federal, state, and local counterparts will remain steadfast in our resolve to rid our community of this clear and present danger.”
Livingston Parish Sheriff Jason Ard stated: “It’s an honor that the hardworking men and women, who make up my Narcotics Division, played a vital role in this extensive investigation. The teamwork between agencies helps to keep us all safe.”
This operation is being handled by the U.S. Attorney’s Office, the U.S. Drug Enforcement Agency, the Livingston Parish Sheriff’s Office, and the Denham Springs Police Department, with assistance from the 21st Judicial District Attorney’s Office, East Baton Rouge Sheriff’s Office, Baton Rouge City Police Department, and the Louisiana State Police. This matter is being prosecuted by Assistant United States Attorney Cam T. Le.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.
- Darryl Q. Cobb, also known as “Hammer Bob” and “Hammer,” age 33, of Baton Rouge, Louisiana, is charged with conspiracy to distribute and possess with the intent to distribute cocaine and cocaine base; distribution of cocaine and cocaine base; possession with the intent to distribute cocaine; unlawful use of a communications facility; and forfeiture.
Marvin Tyrone White Is Sentenced to Wire FraudRead the Press Release
United States Attorney Kenyen R. Brown of the Southern District of Alabama announced that Marvin Tyrone White was sentenced today on a guilty plea to one count of access device fraud. White received $29,000 dollars in claims benefits from the Gulf Coast Claims Facility that he was not entitled to receive.
White was sentenced to the five years of probation and ordered to pay full restitution to the Gulf Coast Claims Facility. This case was investigated by the United States Secret Service and prosecuted by the United States Attorney’s Office.
Local Tax Preparer Charged with False Tax Return PreparationRead the Press Release
HOUSTON – A Houston federal grand jury has returned an indictment charging Doyle J. Blevins Jr., of Willis, with 27 counts of preparing false client tax returns, announced United States Attorney Kenneth Magidson along with Lucy Cruz, special agent in charge of Internal Revenue Service-Criminal Investigation.
“Those who might consider preparing false tax returns this filing season should be aware of the consequences of their actions,” said Cruz. “This indictment emphasizes that the Internal Revenue Service and U.S. Attorney’s Office will continue their aggressive pursuit of those who attempt to defraud America's tax system. Taxpayers should also be very cautious when selecting someone to prepare their returns because ultimately they are responsible for what gets filed with the IRS.”
The indictment was returned Jan. 21, 2015. Blevins surrendered to authorities this morning and will make his initial appearance before U.S. Magistrate Judge George C. Hanks at 2:00 p.m. today.
According to the indictment, Blevins operated a tax return preparation business in Willis under the name Total Refund Tax Service. The indictment alleges he prepared dozens of materially false client tax returns during calendar years 2008 through 2010. The indictment also alleges he included in these tax return bogus “side business” losses in order to generate excessive refunds totaling approximately $285,000.
If convicted, Blevins faces up to three years in federal prison and a possible $250,000 fine on each count.
The case, investigated by IRS-CI, is being prosecuted by Assistant United States Attorney Jimmy Sledge Jr.
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.Lincoln Man Sentenced for Possessing Child PornographyRead the Press Release
United States Attorney Deborah R. Gilg announced that James Craig Lebo, 46, of Lincoln, Nebraska, was sentenced on January 23, 2015, in Lincoln, Nebraska, to 60 months in prison by United States District Judge John M. Gerrard, for possessing child pornography. Jones was also ordered to complete a ten-year term of supervised release after serving his prison sentence. Jones will also be required to register as a sex offender for the remainder of his life.
On April 24, 2014, an investigator with the Lincoln Police Department was investigating computers sharing child pornography files via the internet. On that date, an IP address was identified as having files available for sharing and investigators were able to download files from a computer at that IP address. Subsequent investigation revealed that the IP address was registered to Lebo. In June of 2014, investigators executed a search warrant at Lebo’s residence and made contact with him. During the execution of the search warrant, Lebo was interviewed and admitted he used file sharing software on his computer to file share and download files which have been identified as child pornography because they depict sexually explicit conduct involving children under the age of 18 years old.
A forensic investigation of Lebo’s computer showed that he had received images of child pornography from December of 2013 through June of 2014. The forensic exam also revealed that Lebo received 153 videos and approximately 10,000 images of child pornography. Included in the items were videos and images of prepubescent minors engaged in sexually explicit conduct.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc for more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
This case was investigated by the Lincoln Police Department.
Leader of Mail Theft Ring, "Superman," Charged in 18-Count Indictment with Three Co-ConspiratorsRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that four Anchorage residents were charged in an eighteen-count indictment for their role in a mail theft ring that involved distribution of methamphetamine.
Jonathan Ortiz Escalante, aka “Superman,” 45, of Anchorage, was charged in an eighteen-count indictment with conspiracy, theft of mail, credit card fraud, bank fraud, counterfeit securities, aggravated identity theft, trafficking in methamphetamine, and being a felon in possession of firearms in relation to a shooting in Anchorage. Escalante was previously convicted of conspiring to commit bank fraud in Washington and is therefore prohibited from possessing firearms.
Neasha Martha Moore, 24, of Anchorage, is charged in three counts of the indictment with conspiracy, bank fraud, and counterfeit security, for her role in cashing checks stolen from the mail.
Ralph Edward Oliver, 20, of Anchorage, is charged in two counts of the indictment with conspiracy and attempted bank fraud for his role in attempting to cash checks stolen from the mail.
John Fred Brittain, 23, of Anchorage, is charged in two counts of the indictment with conspiracy and theft of mail for his role in stealing mail in exchange for methamphetamine.
According to Assistant U.S. Attorney Aunnie Steward, who presented the case to the grand jury, Escalante aka “Superman” is alleged to be the leader of a mail theft ring in Anchorage. The indictment charges that Escalante solicited Brittain and others to steal mail and identification cards that he then altered and used to cash stolen checks. Escalante also used stolen credit cards and forged counterfeit securities, and distributed methamphetamine to Brittain and others in exchange for stolen mail. Escalante solicited Moore, Oliver, and others to cash the fraudulent checks. The felon in possession count alleges that Escalante possessed two different Ruger 9mm pistols while he carried out his drug trafficking crimes.
Escalante made his initial appearance before United States Magistrate Judge Kevin McCoy on January 23, 2015. The remaining defendants are not yet in federal custody.
Escalante is facing a mandatory minimum of five years’ incarceration and a maximum of forty years’ incarceration, and a $5 million fine. Moore and Oliver are facing a maximum of thirty years’ incarceration and a $1 million fine. Brittain is facing a maximum of five years’ incarceration and a $250,000 fine.
Ms. Loeffler commends the U.S. Postal Inspection Service, the ATF, the FBI Safe Streets Task Force, and APD for the investigation of this case.
Lanham Man Sentenced to over 3 Years in Prison for Using Stolen Personal Information to Buy Precious MetalsRead the Press Release
Greenbelt, Maryland – U.S. District Judge Deborah K. Chasanow sentenced Olusegun Adebiyi, age 42, of Lanham, Maryland, today to 39 months in prison followed by three years of supervised release for wire fraud and aggravated identity theft arising from a fraud scheme to obtain precious metals using stolen personal information of two victims. Judge Chasanow also entered an order that Adebiyi pay $122,500 in restitution.
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; and Chief Mark A. Magaw of the Prince George’s County Police Department.
According to his plea, on July 3, 2013, Adebiyi and his co-schemers faxed a copy of a fraudulent Maryland driver’s license in the name of a victim to Gold Bullion International (GBI) to complete the process of opening a trading account. Between July 23 and August 27, 2013, Adebiyi and his co-schemers fraudulently purchased precious metals from GBI worth $122,500 in the victim’s name, and caused GBI to deliver those precious metals to an address in Washington, D.C. The payment was made by transferring money from the victim’s bank account without his knowledge.
Similarly, on September 26, 2013, Adebiyi and his co-schemers faxed a copy of a fraudulent Maryland driver’s license in the name of another victim to GBI to complete the process of opening a trading account in this second victim’s name. The fax was sent from a store in College Park, Maryland and Adebiyi’s activities were captured on video. Shortly thereafter, GBI requested that the documents be resubmitted. On October 9, 2013, Adebiyi sent the same information to GBI from the same store which was also captured on video. Thereafter, Adebiyi attempted to purchase precious metals worth $44,833.50 in the name of the second victim and attempted to cause GBI to deliver those items to an address in Washington, D.C.
On November 6, a controlled delivery of the precious metals to the Washington D.C. address was attempted through UPS. Law enforcement observed the defendant drive into the area shortly before the delivery was scheduled. The package was recalled because the delivery address was incomplete. Law enforcement saw Adebiyi leave the area approximately 15 minutes after the package was recalled. GBI, working with law enforcement, rescheduled the delivery for November 14, 2013. Law enforcement again observed Adebiyi drive into the area shortly before the delivery was scheduled. The UPS driver went into the apartment building carrying a package and was observed exiting the building carrying the same package. Law enforcement arrested Adebiyi as he was leaving and seized pieces of paper containing the UPS package tracking numbers for the November 14 delivery, the second victim’s identifying information and the UPS tracking numbers for the November 6 delivery.
The Maryland Identity Theft Working Group has been working since 2006 to foster cooperation among local, state, federal, and institutional fraud investigators and to promote effective prosecution of identity theft schemes by both state and federal prosecutors. This case, as well as other cases brought by members of the Working Group, demonstrates the commitment of law enforcement agencies to work with financial institutions and businesses to address identity fraud, identify those who compromise personal identity information, and protect citizens from identity theft.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Since the inception of FFETF in November 2009, the Justice Department has filed more than 12,841 financial fraud cases against nearly 18,737 defendants including nearly 3,500 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
United States Attorney Rod J. Rosenstein commended the FBI and Prince George’s County Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Bryan E. Foreman, who prosecuted the case.
Lake Jackson Man Gets Five Years for Distributing Child PornographyRead the Press Release
HOUSTON – Lake Jackson resident Bradley Beckerdite, 25, has been sentenced to federal prison following his convictions for distribution and possession of child pornography, United States Kenneth Magidson announced today. Beckerdite pleaded guilty May 12, 2014.
Today, U.S. District Judge Lynn Hughes, who accepted the guilty plea, handed Beckerdite a term of imprisonment of 60 months. He was further ordered to serve five years of supervised release following completion of that term. Beckerdite must also register as a sex offender.
Beckerdite was indicted on April 24, 2013, following an investigation conducted by the Houston FBI Child Exploitation Task Force. That investigation revealed that Beckerdite was making child pornography available to others through the use of peer-to-peer software over the Internet. A special agent downloaded an image of child pornography from the images/videos Beckerdite was making available online. The images included children under the age of 12 being sexually violated by adults and children under the age of 12 in positions which caused their genitalia to be displayed in a lewd/lascivious manner. Bondage involving children was also present on the defendant’s computer.
Law enforcement executed a search warrant on Sept. 6, 2012, at the home of a third party. Beckerdite used the Internet connection at that residence to receive and distribute child pornography in an attempt to avoid detection. The examination of the computer media ultimately obtained from Beckerdite revealed more than 11,000 digital images and approximately 145 videos which contained child pornography.This case, prosecuted by Assistant U.S. Attorney Sherri L. Zack, 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."
KTM Industries, Inc. Resolves False Claims Act Allegations Involving National Science Foundation AwardRead the Press Release
GRAND RAPIDS, MICHIGAN – KTM Industries, Inc. (“KTM”), a Lansing-based company that develops and manufactures biodegradable engineered foam, has agreed to pay $170,923.65 to the federal government to resolve allegations that it fraudulently obtained funding under a National Science Foundation (“NSF”) award in violation of the federal False Claims Act. As part of the settlement, KTM’s CEO agreed to pay an additional $25,000 and submit to a three-year exclusion from participation in federal programs, grants, and contracts. The government previously received $54,076.35 from Michigan State University (“MSU”) in a related investigation into whether, under a subcontract with KTM, MSU spent NSF award funds on unallowable equipment. KTM, KTM’s CEO, and MSU did not admit liability as part of their respective settlements.
In September 2010, NSF awarded KTM Phase II funding under a Small Business Technology Transfer (“STTR”) grant to support the development of chemically-modified plastic starch bio-foams. The United States alleged that to obtain and maintain this funding, KTM and its CEO knowingly made a number of false statements and supplied NSF and NSF contractors with false documents. These false statements and false documents concerned, among other things, KTM’s accounting system and timekeeping records, the actual expenditure of NSF award funds, and the primary employment and payment of the principal investigator on the NSF project. The United States further alleged that during the investigation of this case, KTM produced 24 false and fraudulent employee timesheets in response to an administrative subpoena, the creation of which timesheets was directed by the company’s CEO.
“Those who seek federal funding must be truthful and accurate in their dealings with government agencies,” said U.S. Attorney Patrick Miles. “Companies and individuals that make misrepresentations to obtain such funding undermine the integrity of the grant process and unfairly divert funds from qualified grantees who will play by the rules.”
Allison Lerner, NSF’s Inspector General said, “STTR funding is a valuable tool for small businesses to develop innovative technologies. Unscrupulous individuals and companies who lie to fraudulently obtain these funds will not be tolerated. I commend the U.S. Attorney for his support in this case.”
This case was investigated by NSF’s Office of Inspector General. Assistant U.S. Attorney Adam B. Townshend represented the United States.
KTM Industries, Inc. Resolves False Claims Act Allegations Involving National Science Foundation AwardRead the Press Release
GRAND RAPIDS, MICHIGAN – KTM Industries, Inc. (“KTM”), a Lansing-based company that develops and manufactures biodegradable engineered foam, has agreed to pay $170,923.65 to the federal government to resolve allegations that it fraudulently obtained funding under a National Science Foundation (“NSF”) award in violation of the federal False Claims Act. As part of the settlement, KTM’s CEO agreed to pay an additional $25,000 and submit to a three-year exclusion from participation in federal programs, grants, and contracts. The government previously received $54,076.35 from Michigan State University (“MSU”) in a related investigation into whether, under a subcontract with KTM, MSU spent NSF award funds on unallowable equipment. KTM, KTM’s CEO, and MSU did not admit liability as part of their respective settlements.
In September 2010, NSF awarded KTM Phase II funding under a Small Business Technology Transfer (“STTR”) grant to support the development of chemically-modified plastic starch bio-foams. The United States alleged that to obtain and maintain this funding, KTM and its CEO knowingly made a number of false statements and supplied NSF and NSF contractors with false documents. These false statements and false documents concerned, among other things, KTM’s accounting system and timekeeping records, the actual expenditure of NSF award funds, and the primary employment and payment of the principal investigator on the NSF project. The United States further alleged that during the investigation of this case, KTM produced 24 false and fraudulent employee timesheets in response to an administrative subpoena, the creation of which timesheets was directed by the company’s CEO.
“Those who seek federal funding must be truthful and accurate in their dealings with government agencies,” said U.S. Attorney Patrick Miles. “Companies and individuals that make misrepresentations to obtain such funding undermine the integrity of the grant process and unfairly divert funds from qualified grantees who will play by the rules.”
Allison Lerner, NSF’s Inspector General said, “STTR funding is a valuable tool for small businesses to develop innovative technologies. Unscrupulous individuals and companies who lie to fraudulently obtain these funds will not be tolerated. I commend the U.S. Attorney for his support in this case.”
This case was investigated by NSF’s Office of Inspector General. Assistant U.S. Attorney Adam B. Townshend represented the United States.
KC Man Sentenced for Crack CocaineRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Kansas City, Mo., man was sentenced in federal court today for possessing crack cocaine to distribute.
James C. Allen, 52, of Kansas City, was sentenced by U.S. Chief District Judge Greg Kays to 10 years in federal prison without parole.
On Sept. 22, 2014, Allen pleaded guilty to possessing crack cocaine with the intent to distribute. Allen admitted that he was carrying 3.8 grams of crack cocaine in one of his boots, where it was packaged in over 30 separate plastic baggies for sale. Allen was arrested at a park located at 918 E. Ninth Street on July 30, 2013. At the time of his arrest, Allen also was in possession of an SCCY 9mm pistol.
This case was prosecuted by Assistant U.S. Attorney David A. Barnes. It was investigated by the Kansas City, Mo., Police Department.
Justice Department and Huntsville City Schools Announce Proposed Consent Decree to Provide Equal Educational OpportunitiesRead the Press Release
The Department of Justice announced today that it has filed a proposed consent order in Hereford v. Huntsville Board of Education, a longstanding school desegregation case, to resolve issues related to school attendance zones, black students’ access to quality academic offerings and student discipline, among other areas. The department and counsel for the Huntsville City Schools in Alabama jointly filed the proposed consent order in district court in Birmingham, and are now seeking public comment prior to presentation of the proposed consent order to the Huntsville Board of Education and to the court for final approval.
The proposed agreement, if approved, would resolve the parties’ dispute over the district’s 2014 plan to reconfigure student attendance zones. The Justice Department had objected that the plan did not further desegregation or address racial inequalities in students’ access to quality academic offerings. If approved by the court, the proposed consent order would require the district to provide equal educational opportunities to black students by taking steps including:
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revising attendance zones and growing and strengthening magnet programs to improve diversity at many of its schools;
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expanding access for black students to pre-kindergarten, gifted programs, advanced course offerings such as Advanced Placement and International Baccalaureate, academic after-school programs, and college counseling;
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implementing measures to promote faculty and administrator diversity;
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ensuring that all students are aware of and can equally participate in extracurricular activities;
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creating positive, inclusive school climates, and ensuring that student discipline is fair, non-discriminatory, and does not unnecessarily remove students from classrooms;
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establishing a desegregation advisory committee consisting of students and parents to advise the district and inform the court about implementation of the consent order;
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providing professional development for teachers on such topics as strategies for teaching students from diverse backgrounds, understanding implicit bias, and supporting positive student behavior; and
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continuously monitoring racial disparities to ensure meaningful and sustained improvement in areas including student performance, students’ access to courses, and rates of student discipline.
“A quality education is the key that opens the door to a better future,” said Acting Assistant Attorney General Vanita Gupta for the Civil Rights Division. “This agreement aims to ensure that African American students in Huntsville schools can access that quality education on an equal basis. We look forward to working with the district to implement the measures required by this proposed order, if approved, and eventually bring this case to successful resolution after so many years.”
“The Department of Justice is committed to ensuring that Alabama schools provide African American students, and all students, with the equal educational opportunities guaranteed under federal law,” said U.S. Attorney Joyce White Vance for the Northern District of Alabama.
If the proposed consent order is approved, the Justice Department will monitor and enforce the district’s compliance. The district may seek a declaration of unitary status and dismissal of the case when it can demonstrate sustained compliance with the terms of the consent order.
The proposed consent order can be found at www.proposedconsentorder.com, which also provides information regarding opportunities for public comment, including a series of community forums.
The enforcement of Title IV of the Civil Rights Act of 1964, which prohibits discrimination on the basis of race and other factors in public schools, is a top priority of the Justice Department’s Civil Rights Division. Additional information about the Civil Rights Division of the Justice Department is available on its web site at www.justice.gov/crt.
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