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15 January 2015
United States Settles with Lehigh County Landlord over Section 8 Rent Subsidy PaymentsRead the Press Release
PHILADELPHIA - The United States Attorney's Office announced today that Bellante Properties, of Lehigh County, PA, and its owners Vincent Fantozzi and Bernard Fantozzi, will pay the government $19,120 to resolve allegations surrounding federally-funded rental assistance payments it received. According to a civil complaint, Bellante Properties received rent subsidy payments from the Lehigh County Housing Authority while unlawfully requiring a tenant to pay supplemental rental payments disguised as trash removal fees.
The lawsuit was filed by Karen Schware, in the United States District Court for the Eastern District of Pennsylvania, under the whistleblower provisions of the False Claims Act. The False Claims Act allows private citizens to bring civil actions on behalf of the United States and to share in any recovery.
The Section 8 housing assistance program is designed to provide affordable housing to low-income families. According to the government’s complaint, between July 2007 and September 2013, Bellante Properties received payments from the Lehigh County Housing Authority under the Section 8 rent assistance program. In addition to receiving federally-funded Section 8 rent assistance payments, and approved rent payments from the tenant, the government alleges that Bellante Properties also unlawfully required the tenant to provide supplemental rent payments that had not been approved by the Lehigh County Housing Authority. The unlawful supplemental payments were disguised as trash removal fees. The parties have agreed to settle the dispute for a payment by the defendants of $19,120 to the United States. Bellante Properties and its principals, Vincent Fantozzi and Bernard Fantozzi, are also barred for three years from participation in HUD’s Section 8 program. As a whistleblower, Schware will receive a share of the settlement proceeds. Bellante Properties will also pay Schware’s legal fees.
The settlement was the result of a coordinated effort by the U.S. Attorney’s Office for the Eastern District of Pennsylvania and the Department of Housing and Urban Development Office of Inspector General. The case was handled by Assistant U.S. Attorney Joel M. Sweet.
U.S. Attorney Barry Grissom to Speak on Martin Luther King Day in ManhattanRead the Press Release
TOPEKA, KAN. - U.S. Attorney Barry Grissom will speak on Martin Luther King Day in Manhattan.
Grissom will be the featured speaker for the Martin Luther King Prayer Breakfast. The event is set for 8 a.m. Jan. 19 at the Four Points Sheraton, 530 Richards Drive in Manhattan.
“Dr. King helped to bring about our nation’s greatest civil rights legislation, the Civil Rights Act of 1964 and the Voting Rights Act of 1965,” Grissom said. “As he always said, we’ve come a long way – and we still have a long way to go.”
Grissom was appointed by the president and confirmed by the U.S. Senate in 2010. The U.S. Attorney has three offices in Kansas – Kansas City, Kan., Topeka and Wichita – and a staff of approximately 100 employees, including about 50 Assistant U.S. Attorneys.
Two Men Sentenced for Roles in Conspiracy to Conduct Fraudulent Credit Card Transactions at North Texas Sam’s ClubsRead the Press Release
DALLAS — Two men who conspired together to use counterfeit credit cards to make hundreds of thousands of dollars of purchases at various Sam’s Club store locations in North Texas and Missouri, have been sentenced, announced John Parker, Acting U.S. Attorney for the Northern District of Texas.
Yesterday, Leonel Martiatu, 29, was sentenced by U.S. District Judge Barbara M. G. Lynn to serve a total of 72 months in federal prison. Martiatu pleaded guilty in August 2014 to one count of conspiracy to commit access device fraud and one count of aggravated identity theft.
Co-conspirator Alian Gamboa, 20, who pleaded guilty to the same offenses, was sentenced last month by Judge Lynn to serve a total of 60 months in federal prison.
In addition, Judge Lynn ordered that Martiatu and Gamboa pay, jointly and severally, $340,497 in restitution. Both defendants have been in custody since their arrest in March on a related federal criminal complaint. Both have ties to Miami, Florida, according to detention orders entered in the case.
According to plea documents filed, from January 17, 2014, to approximately March 4, 2014, Martiatu and Gamboa conspired together and used counterfeit access devices encoded with credit card numbers – issued to others – to make purchases at Sam’s Club locations in and near Dallas and elsewhere, including Missouri. Together, the two obtained a total of $340,497 of things of value, affected interstate commerce, and acted with the intent to defraud the persons to whom the credit cards were issued.
According to the complaint filed in the case, on March 3, 2014, the defendants were located at a motel on N. Central Expressway in Dallas. The following day, a federal search warrant was executed at their room in the motel, and numerous items purchased from Sam’s Clubs were located.
The U.S. Secret Service investigated. Special Assistant U.S. Attorney Danial Gividen prosecuted.
Two Fresno Men Charged with Being Felons in Possession of A FirearmRead the Press Release
FRESNO, Calif. — Today, a federal grand jury in Fresno indicted two defendants in separate cases with being felons in possession of a firearm, United States Attorney Benjamin B. Wagner announced.
The cases were brought as part of the Project Safe Neighborhoods (PSN) federal initiative. PSN brings together federal, state and local law enforcement to combat gun and gang crime. At the core of PSN is increased federal prosecution to incapacitate chronic violent offenders as well as to communicate a credible deterrent threat to potential gun offenders.
According to the first indictment, police officers conducted a probation search of an apartment in Fresno where Alan Anthonee Amey, 23, was residing after receiving a report that Amey had two guns and was threating to shoot the reporting party. Officers found a loaded Glock 23 .40‑caliber semi-automatic handgun and a loaded Ruger P95 9mm handgun. Amey is prohibited from possessing a firearm after being convicted in Fresno County of domestic violence in 2010 and 2011. Assistant United States Attorney Laurel J. Montoya is prosecuting the case.
The second indictment alleges that on December 6, 2014, Ernie Michael Rodriguez, 39, of Fresno, was stopped by officers when he failed to stop at a stop sign. Officers searched the vehicle and found an AA Arms, model AP9, 9mm firearm. The firearm had a high capacity magazine that contained 26 rounds of live ammunition. The vehicle had been reported stolen the previous day. Rodriguez is prohibited from possessing a firearm. Assistant United States Attorney Kimberly A. Sanchez is prosecuting the case.
If convicted, the defendants face a maximum statutory penalty of 10 years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
The charges against defendants are only allegations and the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
These cases are the product of investigations by the Fresno Police Department.Tulsa Man Sentenced to 9 Years for Bank RobberyRead the Press Release
TULSA, Okla.—United States District Chief Judge Gregory K. Frizzell sentenced Aaron Joseph Rock, 24, of Tulsa, to serve 110 months in prison today for robbing a bank in Sand Springs, U.S. Attorney Danny C. Williams Sr. announced.
On June 14, 2014, Rock entered BancFirst in Sand Springs and presented a bank teller with a bank withdrawal slip on which was written the message, “Give me your money, I have a gun.” Rock then stole $1,232 from the bank.
Rock was indicted on August 5, 2014. United States Judge Frizzell also ordered Rock to pay $1,232 in restitution to the bank.
The case was investigated by the FBI and the Sand Springs Police Department. Assistant U.S. Attorneys R. Trent Shores and Clinton J. Johnson prosecuted on behalf of the United States.
U.S. v. Aaron Joseph Rock
Traffickers with Ties to Mexican Drug Cartel Sentenced to PrisonRead the Press Release
Tampa, Florida – U.S. District Judge Mary Scriven today sentenced Mario Manzur Reyes (31, Tampa) and Santos Rene Herrera-Cruz (50, Tampa) for conspiring to distribute and possess with intent to distribute 500 grams or more of methamphetamine. Reyes was sentenced to five years and ten months in federal prison. Herrera-Cruz was sentenced to ten years’ imprisonment. Both pleaded guilty in September 2014.
According to court documents, Reyes oversaw the delivery of more than 16 pounds of highly pure methamphetamine from Laredo, Texas to the Tampa area. The methamphetamine had a street value of at least $250,000. Reyes, who was affiliated with a drug cartel operating out of Michoacán, Mexico, arranged for the drugs to be picked up on March 10, 2014, by one of his customers at a truck stop on U.S. 301. The customer, in turn, hired Herrera-Cruz to take possession of the shipment for him.
“Trafficking methamphetamine is a serious offense and a danger to our communities,” said Susan L. McCormick, special agent in charge of Homeland Security Investigations Tampa. “HSI, together with our federal, state and local law enforcement partners, is committed to combating the menace posed by illegal substances.”
This case was investigated by the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. It is being prosecuted by Assistant United States Attorney Patrick Scruggs.
Three Toledo Residents Indicted for Forging Will to Fraudulently Obtain $2.2 MillionRead the Press Release
A 59-count federal indictment was unsealed today charging three Toledo residents for their roles in a conspiracy in which they are accused of forging a will to fraudulently gain control of an estate worth approximately $2.2 million, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Indicted are: Susan M. Pioch, 58; Margaret L. McKnight, 40, and Kurt L. Mallory, 51. They each face one count of conspiracy to commit bank fraud and mail fraud, 21 counts of bank fraud, seven counts of mail fraud and one count of aggravated identity theft. Pioch, McKnight and Mallory each face additional counts of money laundering. McKnight faces an additional count of structuring cash withdrawals, three tax counts and seven counts of causing a financial institution to fail to file a required report.
“This group lied, cheated and stole millions of dollars that had been amassed over a lifetime,” Dettelbach said.
“When you knowingly mix deceit and trickery into the financial well-being of individuals, you create a recipe for devastation that could last a lifetime,” said Kathy A. Enstrom, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office.
Martin E. Fewlas executed a will in 1993 devising his entire estate to his brother. If his brother did not survive Fewlas, the estate was to go to his nephew and then his great-nephew, identified in the indictment as JRM.
Fewlas owned the duplex located at 2557 Broadway Street in Toledo. He lived in the lower half and for approximately 10 years, McKnight and Mallory lived together in the upper half, according to the indictment.
Fewlas died on Aug. 28, 2010, leaving an estate worth approximately $2.2 million. On Sept. 2, 2010, McKnight, Mallory and Pioch – an attorney who had previously done legal work for McKnight and Mallory forged a will in Fewlas’ name. The forged will was drafted by Pioch and named McKnight as the executor and sole devisee of Fewlas’ assets. Pioch filed the forged will with the Lucas County Probate Court on or around Sept. 2, 2010. McKnight identified herself as executor of the estate and Pioch identified herself as attorney for the executor in probate court documents, according to the indictment.
By filing the forged will and concealing its fraudulent nature, Pioch, McKnight and Mallory succeeded in obtaining Probate Court authority to take possession of Fewlas’ assets. After obtaining those assets, they disbursed the assets to themselves for their own enrichment, according to the indictment.
Pioch, McKnight and Mallory used those assets to purchase, among other things, a used car dealership, a 2000 Discovery motorhome for $55,036, a classic 1972 Chevrolet El Camino for $17,000, a 2010 Kia Soul SUV for $21,338, as well as property. They also withdrew more than $500,000 in cash for Fewlas’ estate proceeds, according to the indictment.
JRM, Fewlas’ great nephew and the sole remaining devisee from the 1993 will, received nothing, according to the indictment.
The case is being prosecuted by Assistant U.S. Attorneys Gene Crawford and James V. Moroney following an investigation by the Internal Revenue Service – Criminal Investigations and the Toledo Police Department.
If convicted, the defendants’ sentences will be determined by the court after a review of the federal sentencing guidelines and factors unique to the case, including the defendant’s prior criminal record (if any), the defendant’s role in the offense and the characteristics of the violation.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Three Plead Guilty in Federal Court, 4th to Stand Trial in Arson-for-Profit SchemeRead the Press Release
PROVIDENCE, R.I. – Gbabia Kollie, 27, of Johnson City, Tenn., has pleaded guilty in federal court in Providence to participating in an alleged scheme to burn a multi-tenement building at 31-33 Ida Street in Providence in November 2013, in an alleged arson-for-profit scheme. Kollie has been detained in federal custody since December 5, 2013, when he was removed from an outbound international flight leaving Atlanta for Liberia and arrested by ATF agents.
Appearing on Wednesday before U.S. District Court Chief Judge William E. Smith, Kollie pleaded guilty to one count each of conspiracy to commit arson and arson. He faces statutory penalties totaling between 5 and 40 years in federal prison and a fine of up to $500,000 when he is sentenced on April 3, 2015.
Two co-conspirators, Abraham Kerkula, 21, of Pawtucket and Nakele Freeman, 21, of Providence, previously pleaded guilty to one count each of conspiracy to commit arson and arson. Kerkula is scheduled to be sentenced by U.S. District Court Chief Judge William E. Smith on March 27, 2015. A sentencing hearing has not yet been scheduled for Nakele Freeman. Both are detained in federal custody.
A fourth defendant in this matter, Kormahyah Karmue, 39, of, Providence, owner of the Ida Street property allegedly targeted to be burned, is awaiting trial on charges of conspiracy to commit arson, arson, wire fraud, mail fraud and theft of U.S. government funds. It is alleged in a federal indictment returned in May 2014, that Karmue masterminded the scheme in order to collect insurance payments. He has pleaded not guilty to the charges and is detained in federal custody.
The guilty pleas are announced by United States Attorney Peter F. Neronha; Daniel J. Kumor, Special Agent in Charge of the Boston Field Divisionof the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF); and Providence Public Safety Commissioner Steven M. Paré.
At the time of his guilty plea, Kollie admitted to the court that he enlisted the assistance of Nakele Freeman to participate in the alleged conspiracy. At the time of their guilty pleas, Freeman and Kerkula admitted that late in the evening of November 1 and in the early morning hours of November 2, 2013, Freeman asked Kerkula to give him a ride to a location where he was going to set fire to a building for “a lot of money.”
After traveling together to purchase 5-gallon gasoline storage containers and gasoline, Freeman and Kerkula traveled to the targeted property where Freeman removed the gasoline from the vehicle and entered the building. Freeman admitted to the court that he entered a vacant third floor apartment and spread the gasoline, and a fire ignited. He fled the building and met Kerkula at a designated location on a nearby side street.
According to court documents and information presented to the court, it is alleged that Kollie arranged with Freeman to set fire to the building in return for a payment of a portion of the expected insurance settlement. It is alleged that Kollie had several telephone conversations with Freeman while Freeman and Kerkula were in the vehicle en route to the Ida Street property.
An indictment is merely an allegation and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
The case is being prosecuted by Assistant U.S. Attorney William J. Ferland.
The investigation was conducted by ATF, the Providence Fire Department Arson Squad and the Providence Police Department Detective Bureau.
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Contact: 401-709-5357
[email protected]Three More Sent to Federal Prison for Roles in Large Scale Marijuana ConspiracyRead the Press Release
Contact: Steve Young
Three men are headed to federal prison for their roles in a marijuana trafficking organization that brought large amounts of high-priced marijuana from Colorado and California to Iowa.
Jesse Tolen, Shannon Ehlts, and Corey Marx all pled guilty to conspiracy to distribute marijuana and were sentenced today in Cedar Rapids by United States District Court Chief Judge Linda R. Reade. Tolen had also pled guilty to conspiracy to commit money laundering.
- Tolen, 36, from Castella, California, was sentenced to 24 months’ imprisonment and will report to the Bureau of Prisons on a later date.
- Ehlts, 38, from Lowden, Iowa, was sentenced to nine months’ imprisonment and will report to the Bureau of Prisons on a later date.
- Marx, 29, from Cedar Rapids, Iowa, was sentenced to eight months’ imprisonment followed by a two month period of home detention. Marx is being held in the United States Marshal’s custody until he can be transported to a federal prison
All three must also serve three-year terms of supervised release after their prison terms. There is no parole in the federal system.
Tolen, Ehlts, and Marx were the last of twelve people to be sentenced in the conspiracy. Sentences for the twelve ranged from probation to 46 months’ imprisonment. The organization was dismantled through a DEA investigation that involved court-authorized wiretaps on multiple cellular phones.
The cases were prosecuted by Assistant United States Attorneys Justin Lightfoot and Matthew Cole, and investigated by the Drug Enforcement Administration (DEA) Task Force as part of the Organized Crime Drug Enforcement Task Force (OCDETF) program of the United States Department of Justice. The DEA Task Force consists of the DEA; the Linn County Sheriff's Office; the Cedar Rapids Police Department; the Marion Police Department; the Iowa City Police Department; and the Iowa Division of Narcotics Enforcement..
Court file information is available at https://ecf.iand.uscourts.gov/ cgi-bin/login.pl. The case file numbers for the twelve sentenced defendants are as follows: Mark Swanson 14-CR-66; Nels Nelson 14-CR-6; Chad Straub 14-CR-20; Robert and Brenda Leonard 14-CR-37; Tolen 14-CR-39; Matthew Fritz 14-CR-78; Ehlts 14-CR-79; Tyler Scheer 14-CR-82; Marx 14-CR-85; James Allen 14-CR-86; and Cory Kintzel 14-CR-92
- Tolen, 36, from Castella, California, was sentenced to 24 months’ imprisonment and will report to the Bureau of Prisons on a later date.
Three Mexican Brothers Plead Guilty to Sex Trafficking and Sex Trafficking ConspiracyRead the Press Release
Earlier this week and today, in federal court in Brooklyn, New York, three brothers pled guilty to sex trafficking charges. The defendants, who are Mexican nationals, transported Mexican females from Mexico to the United States illegally, forcing them to work as prostitutes in New York City and elsewhere. At the time of sentencing, defendants Jorge Estrada-Tepal and Ricardo Estrada-Tepal, who pled guilty to sex trafficking conspiracy and sex trafficking involving force, fraud and coercion, face a mandatory term of imprisonment of 15 years, with a maximum possible sentence of up to life in prison. Defendant Victor Leonel Estrada-Tepal, who pled guilty to sex trafficking conspiracy and sex trafficking of a minor, faces a mandatory term of imprisonment of ten years, with a maximum possible sentence of up to life in prison. The defendants were arrested in January 2014. These guilty pleas are the latest in the Office’s comprehensive anti-trafficking program, which has to date indicted over 55 defendants in sex trafficking cases and rescued over 115 victims, including over 25 minors.
The guilty pleas were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, and James T. Hayes, Jr., Special Agent-in-Charge, U.S. Immigration and Customs Enforcement, Homeland Security Investigations (HSI), New York.
“The defendants are classic predators: they targeted women and a young girl in Mexico, and pushed them into a life of sexual slavery in Mexico and the United States. As our trafficking cases have repeatedly shown, we will not relent against those who choose to subject victims to modern-day slavery in an effort to line their own pockets,” stated United States Attorney Lynch. Ms. Lynch thanked the Mexican authorities and other entities that assisted with the investigation and successful prosecution of this case.
“These men preyed on innocent women, luring them into the United States under false pretenses and then cruelly enslaving them to satisfy their own greed in a ruthless prostitution scheme,” said HSI Special Agent-in-Charge Hayes. “Prosecuting human traffickers and rescuing human trafficking victims is a priority of this office and the Department of Homeland Security. These guilty pleas highlight that commitment and serve as a warning to other predators that law enforcement at all levels is determined to dismantle these heartless human trafficking organizations.”
As set forth in court documents, and discussed during the guilty plea proceedings, the sex trafficking involved at least four victims, and the defendants used various methods to force these women to work in prostitution, ranging from threats of violence, assault and psychological coercion. One minor victim, identified at the guilty plea proceedings as Jane Doe 4, was under the age of 18 when she was trafficked to the United States. During the guilty plea held today, defendant Jorge Estrada-Tepal admitted that, starting in 2007, he and his brothers entered into a conspiracy to transport women from Mexico to Queens to engage in prostitution, and that threats of force were used against the victims. Likewise, yesterday, Ricardo Estrada-Tepal admitted that he and his brothers brought women from Mexico to the United States, where they were forced to work in prostitution, and that he and his brothers did not tell the women the “real truth about why they were coming to the United States.” On Tuesday, defendant Victor Leonel Estrada-Tepal admitted that he agreed with his brothers to force women to work in prostitution, including his wife, Jane Doe 4, who was 17 years old at the time, who he brought from Mexico to Queens to have her engage in prostitution.
Since 2009, the Departments of Justice and Homeland Security have collaborated with Mexican law enforcement counterparts in the Procuraduría General de la República (PGR), the Secretaría de Seguridad Pública (SSP), Procuraduría Social de Atención a las Víctimas de Delitos (PROVICTIMA), and non-governmental partners in the United States and Mexico in a Bilateral Human Trafficking Enforcement Initiative. Through this Initiative, the United States and Mexico have worked together to bring high-impact prosecutions under both U.S. and Mexican law to more effectively dismantle human trafficking networks operating across the U.S.-Mexico border, prosecute human traffickers, rescue human trafficking victims, and reunite victims with their families. Other significant bilateral cases have been prosecuted in Atlanta, Georgia, and Miami, Florida.
The government’s case was prosecuted by Assistant United States Attorneys Taryn A. Merkl and Melody Wells.
The Defendants:
RICARDO ESTRADA-TEPAL
Age: 33
Queens, NY
VICTOR LEONEL ESTRADA-TEPAL
Age: 29
Queens, NY
JORGE ESTRADA-TEPAL
Age: 37
Queens, NY
E.D.N.Y. Docket No. CR-14-105 (MKB)
- This release has been removed
Tarrant County Woman Sentenced to 27 Months in Federal Prison for Theft of Government FundsRead the Press Release
DALLAS — A Keller, Texas, woman who continued to collect a family member’s Social Security retirement insurance benefits even after that family member died, was sentenced this afternoon, announced John Parker, Acting U.S. Attorney for the Northern District of Texas.
Jeani Mulligan, 43, was sentenced by U.S. District Judge Jane J. Boyle to serve 27 months in federal prison. Mulligan, who pleaded guilty in September 2014 to one count of theft of government funds, must also pay a total of $124,825 in restitution. At the conclusion of the hearing, Judge Boyle remanded Mulligan into federal custody.
According to documents filed in the case, Mulligan admitted that she received approximately $124,825 in Social Security benefits to which she was not entitled. Specifically, from approximately December 30, 2000, to February 2013, Mulligan received Title II Retirement Insurance benefits paid to her mother-in-law, to which she knew she was not entitled. Mulligan continued to receive these funds after her mother-in-law died on December 30, 2000.
The case was investigated by the Social Security Administration’s Office of the Inspector General. Special Assistant U.S. Attorney Nicole Dana prosecuted.
Suspected Alien Smuggler and Four Others IndictedRead the Press Release
BATON ROUGE, LA - United States Attorney Walt Green announced today that a federal grand jury has returned five (5) indictments arising from an investigation into the transportation of illegal aliens through the Middle District of Louisiana.
Raul Vega, age 60, of Homestead, Florida, was charged in a criminal complaint filed on December 11, 2014, with transporting illegal aliens within the United States for commercial or private financial gain. On December 17, 2014, a federal grand jury returned an indictment charging Vega with the same offense. According to the indictment, on December 10, 2014, the defendant was driving a vehicle on Interstate 12 in Baton Rouge containing a total of ten (10) illegal aliens, including four (4) individuals who allegedly had previously been deported from the United States. Those four individuals – David Raymundo-Matom, Antonio Pedro-Lorenzo, Jose Ramirez-Arroyo, and Gabriel Salgado-Lozano – were also indicted by the grand jury on December 17, and each stands charged with illegal re-entry into the U.S. by a previously-deported alien.
This matter is being investigated by the Baton Rouge offices of the U.S. Border Patrol and the U.S. Department of Homeland Security, Homeland Security Investigations (HSI). This matter is being prosecuted by Assistant U.S. Attorney Jessica M.P. Thornhill.
NOTE: An indictment is an accusation by the Grand Jury. The defendants are presumed innocent until and unless adjudicated guilty at trial or through a guilty plea.
Streetsboro Man Indicted on Child Pornography ChargesRead the Press Release
A federal indictment was unsealed that charges a Streetsboro man with with two counts related to child pornography, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation's Cleveland Office.
Ronald Flick, 46, was charged with one count of receiving and distributing visual depictions of minors engaged in sexually explicit conduct and one count of possessing computers, hard drives and compact discs containing child pornography.
The case is being prosecuted by Assistant United States Attorney Michael Sullivan following an investigation by the Federal Bureau of Investigation, the Ohio Bureau of Criminal Investigation and the Streetsboro Police Department.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Stockton Man Pleads Guilty to Illegally Selling FirearmsRead the Press Release
SACRAMENTO, Calif. —Donovan Torres, 21, of Stockton, pleaded guilty today to illegally selling firearms, United States Attorney Benjamin B. Wagner announced.
According to court documents, on January 15, 2014, Donovan Torres participated in the illegal sale of three firearms to an undercover special agent working with the U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives. Then, on January 31, 2014, Torres sold the agent a Masterpiece Arms MPA30, 9mm pistol for $1,350. And on February 13, 2014, Torres met with a second undercover ATF agent and sold him an Izhmash Saiga, .223‑caliber rifle for $1,600. These illegal gun sales all took place inside a residence in Stockton. Torres did not have a federal license to sell firearms.
This case is the product of an investigation by the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant United States Attorney Christiaan Highsmith is prosecuting the case.
Donovan Torres is scheduled to be sentenced by United States District Judge Morrison C. England Jr. April 9, 2015. He 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.
State Inmate Sentenced on Conviction of Forging A Federal Judge’s SignatureRead the Press Release
PITTSBURGH – An inmate at SCI-Houtzdale, located in Houtzdale, Pennsylvania, pleaded guilty and was sentenced in federal court in Pittsburgh on a charge of forging a judge’s signature, United States Attorney David J. Hickton announced today.
Michael J. Kramer, 31, formerly of New Kensington, Pa., and currently serving a sentence for a state parole violation at SCI Houtzdale, pleaded guilty and was sentenced to six months’ incarceration, followed by three years of supervised release, on one count before United States District Judge Arthur J. Schwab.
According to information provided to the Court, on April 4, 2014, a Records Specialist at SCI Houtzdale contacted the United States Marshals’ Office with concerns that the institution may have received a falsified “Order of Court” in which it was written that “Michael J. Kramer’s guilty plea be and as the same is VACATED.” The document was present in Kramer’s transport file. Kramer had recently been returned to Houtzdale from SCI Pittsburgh, and this folder would have returned to Houtzdale with him.
At the time, Kramer was in state custody serving a parole violation and was due to be released from state custody in August 2014. A federal detainer followed him, however, because he also had pleaded guilty and was awaiting sentencing in federal court in Pittsburgh on charges of armed bank robbery, possession of a firearm by a convicted felon, and using a firearm in relation to a crime of violence. The Records Specialist at Houtzdale believed the Court Order purportedly vacating Kramer’s conviction was a fraudulent document because she did not observe a court seal, the order contained two different fonts, the order did not contain an original signature, and the order was folded six ways, as though someone had placed it in his pocket.
The Marshals reviewed Kramer’s bank robbery court docket online and confirmed that no such order was actually filed dismissing his conviction. The Marshals also traveled to Houtzdale to interview Kramer, and Kramer confessed to the Marshals that he created this fake Court Order in the law library at the prison.
Last month, Kramer was sentenced by the Honorable David S. Cercone to 20 years (240 months) in prison, followed by five years of supervised release, on his armed bank robbery and firearms conviction. Judge Schwab ordered that the six-month sentence for the forgery conviction should run concurrently with the robbery and firearms conviction
Assistant United States Attorneys Barbara K. Doolittle, Troy Rivetti, and Conor Lamb prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Federal Bureau of Investigation, the Borough of Coraopolis Police Department, and the United States Marshals’ Service for the investigation leading to the successful prosecution of Michael J. Kramer.
State Employee Pleads Guilty to Tax EvasionRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that MICHAEL CARTER, 51, of New Haven, pleaded guilty today before U.S. District Judge Alvin W. Thompson in Hartford to one count of tax evasion.
This matter stems from an Internal Revenue Service investigation into high income State of Connecticut employees who had little or no federal withholding taken out of their paychecks and who failed to file income tax returns. The investigation revealed that certain state employees submitted fraudulent W-4 forms claiming numerous exemptions and had no money withheld from their wages.
According to court documents and statements made in court, CARTER has been employed by the Connecticut Department of Mental Health and Addiction Services, working as a nurse at the Connecticut Valley Hospital in Middletown since 2005. CARTER submitted a false Form W-4 to the state indicating that he had 99 exemptions and was exempt from tax withholding. As a result, no money was withheld from his wages. During the 2010 through 2012 tax years, CARTER paid no federal income taxes on more than $282,000 in income he received, resulting in a federal tax loss of $53,344.
Judge Thompson scheduled sentencing for April 14, 2015, at which time CARTER faces a maximum term of imprisonment of five years and a fine of up to $250,000. He also is required to pay back taxes, plus interest and penalties.
CARTER was charged by indictment on April 9, 2014, and is currently released on bond.
This ongoing investigating is being conducted by the Internal Revenue Service – Criminal Investigation Division. The case is being prosecuted by Assistant U.S. Attorney Susan Wines.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722 [email protected]South Florida Man Sentenced for Oxycodone Distribution and Identity TheftRead the Press Release
BOSTON – A Miami man operating throughout South Florida was sentenced on Jan. 9, 2015, for his role in an oxycodone distribution conspiracy involving thousands of oxycodone pills and stolen identities of Puerto Rican residents.
Jose Perez, 40, was sentenced by U.S. District Court Judge Richard G. Stearns to 46 months in prison and three years of supervised release. In April 2014, Perez pleaded guilty to conspiracy to possess with intent to distribute and to distribute oxycodone, distribution of oxycodone, and identity theft.
In February 2011, a federal investigation into the oxycodone distribution organization operated by Perez in Florida and several co-conspirators in the Boston area revealed that from at least 2011 through January 2013, Perez sold large quantities of oxycodone pills to co-conspirators in Massachusetts and Rhode Island who distributed the oxycodone pills in Massachusetts. Beginning in November 2011, Perez initiated an identity theft and tax refund scheme where he sold hundreds of legitimate names, dates of birth, and Social Security numbers of Puerto Rican residents to an undercover federal agent, intending that the identities be used to fraudulently obtain tax refunds. Over the last several years, increasing numbers of drug dealers have diversified their operations to include lucrative identity theft and tax fraud schemes.
United States Attorney Carmen M. Ortiz; Michael J. Ferguson, Acting Special Agent in Charge of the Drug Enforcement Administration, Boston Field Division; and William P. Offord, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston, made the announcement. The case was prosecuted by Assistant U.S. Attorney Christophe F. Bator of Ortiz’s Drug Task Force Unit.
Snyder Dentist Indicted on Tax ChargesRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
BUFFALO, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that a federal grand jury has returned an indictment charging Charles Weber, 59, of Snyder, NY, with making and subscribing a false tax return. The charges carry a maximum penalty of three years in prison, a fine of $250,000 or both.Assistant U.S. Attorney MaryEllen Kresse, who is handling the case, stated that Weber is a dentist with a private practice in Williamsville, NY. In April 2009, the defendant filed tax returns for 2006 and 2007, falsely claiming that he was not a United States citizen and had not been present in the United States at any time during 2006 or 2007. Weber also falsely stated that his only taxable income in 2006 and 2007 came from dividends, failing to disclose that he had been engaged in the operation of his dental practice during those years and as a result received reportable income. The defendant signed the tax returns under the penalties of perjury.
Weber was arraigned before U.S. Magistrate Judge Hugh B. Scott.
The indictment is the culmination of an investigation on the part of Special Agents of the Internal Revenue Service, under the direction Special Agent-in-Charge Shantelle P. Kitchen.
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.
Shreveport Woman Pleads Guilty to Stealing More Than $39,000 in Social Security PaymentsRead the Press Release
SHREVEPORT, La. – United States Attorney Stephanie A. Finley announced today that a Shreveport woman pleaded guilty to stealing more than $39,000 in Social Security benefit payments.
Stephanie D. Lynn, 49, of Shreveport, pleaded guilty before U.S. District Judge S. Maurice Hicks Jr. to one count of theft of government funds. According to evidence presented at the guilty plea, from May 2009 to December 2013, Lynn cashed and used her deceased son’s Social Security benefit checks, to which she was not entitled. She also did not inform the Social Security Administration that her son had died and submitted paperwork stating that he was alive in order to continue receiving the checks. The total amount taken was $39,435.
Lynn faces up to 10 years in prison, three years of supervised release, a $250,000 fine and restitution. A sentencing date of April 29, 2015 was set.
The Social Security Administration, Office of Inspector General, conducted the investigation. Assistant U.S. Attorney Seth D. Reeg is prosecuting the case.
Sentencings for January 8 - 14, 2015Read the Press Release
Anthony Stoner, 29, of Gillette, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on January 14, 2015, for conspiracy to possess with intent to distribute 500 grams or more of methamphetamine and for possession of firearms in furtherance of a drug trafficking crime. Stoner was arrested in Gillette, Wyoming. He received 180 months imprisonment, to be followed by five years of supervised release, and was ordered to pay a $200.00 special assessment. This case was investigated by the Wyoming Division of Criminal Investigation.
Sergio Bucio-Cuellar, 47, of Mexico, was sentenced by Federal District Court Judge Scott W. Skavdahl on January 14, 2015, for illegal re-entry of a previously deported alien into the United States. Bucio-Cuellar was arrested in Cheyenne, Wyoming. He received 12 months imprisonment, was ordered to pay a $100.00 special assessment, and is subjection to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Miguel Angel Rodriguez-Bustos, 41, of Mexico, was sentenced by Federal District Court Judge Scott W. Skavdahl on January 14, 2015, for illegal re-entry of a previously deported alien into the United States. Rodriguez-Bustos was arrested in Rawlins, Wyoming. He received time served, plus ten days, was ordered to pay a $100.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Freddy Urbina, 42, of Nicaragua, was sentenced by Federal District Court Judge Scott W. Skavdahl on January 13, 2015, for illegal re-entry of a previously deported alien into the United States. Urbina was arrested in Casper, Wyoming. He received time served, plus ten days, was ordered to pay a $100.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Raul Gomez-Medina, 40, of Mexico, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on January 12, 2015, for illegal re-entry of a previously deported alien into the United States. Gomez-Medina was arrested in Jackson, Wyoming. He received time served, plus ten days, was ordered to pay a $100.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Oscar Asencio-Melian, aka Oscar Ascencio-Ramirez, Luis Orland Polo-Abadia, and Oscar Omar-Rodriguez, 40, of Guatemala, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on January 12, 2015, for illegal re-entry of a previously deported alien into the United States and for misuse of a social security number. Asencio-Melian was arrested in Sundance. He received 15 months imprisonment, to be followed by three years of supervised release, was ordered to pay a $200.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Camerron Morris, 37, of Green River, Wyoming, was sentenced by Chief Federal District
Court Judge Nancy D. Freudenthal on January 12, 2015, for conspiracy to possess with intent to distribute heroin. Morris was arrested in Green River, Wyoming. She received 15 months imprisonment, to be followed by three years of supervised release, and was ordered to pay a
$100.00 special assessment and a $200.00 fine. This case was investigated by the Sweetwater
County Sheriff’s Office, the Wyoming Division of Criminal Investigation and the U.S. Drug
Enforcement Administration.Trevor James Tucker, 42, of Ogden, Utah, was sentenced by Federal District Court Judge Scott
W. Skavdahl on January 9, 2015, for conspiracy to possess with intent to distribute, and to distribute, 500 grams or more of methamphetamine. Tucker was arrested in Salt Lake City, Utah. He received 57 months imprisonment, to be followed by five years of supervised release, and was ordered to pay a $100.00 special assessment. This case was investigated by the
Wyoming Division of Criminal Investigation.Lonnie Lindell, 43, of Cheyenne, Wyoming, was sentenced by Chief Federal District Court
Judge Nancy D. Freudenthal on January 9, 2015, for theft of government money. Lindell was arrested in Cheyenne, Wyoming. He received two years of probation, with special conditions, and was ordered to pay a $100.00 special assessment and restitution in the amount of
$149,824.00. This case was investigated by the U.S. Social Security, Office of the Inspector
General.Derek Keith Taylor, 42, of Layton, Utah, was sentenced by Chief Federal District Court Judge
Nancy D. Freudenthal on January 8, 2015, on one count of conspiracy to possess with intent to distribute, and to distribute, at least 500 grams of methamphetamine; one count of possession with intent to distribute methamphetamine; and one count of conspiracy to launder money.
Taylor was arrested in Evanston, Wyoming. He received 120 months imprisonment, to be followed by five years of supervised release, and was ordered to pay a $300.00 special assessment. This case was investigated by the Wyoming Division of Criminal Investigation and the U.S. Drug Enforcement Administration.Sacramento Drug Dealer Sentenced to More Than 21 Years in PrisonRead the Press Release
SACRAMENTO, Calif. — John Winton Harris, 31, of Sacramento, was sentenced today by United States District Judge Morrison C. England Jr. to 21 years and 10 months in prison for possessing more than 163 grams of crack cocaine, United States Attorney Benjamin B. Wagner announced.
According to evidence presented at trial, Sacramento police officers responded to a domestic violence complaint at an apartment complex in Sacramento. When the officers entered the apartment, they found Harris crouched in the kitchen area. He was moved to a different location in the apartment, and when officers found a large amount of cocaine base where he had been crouching in the kitchen, Harris attempted to flee. Harris claimed he did not live in the apartment, but officers found mail addressed to him at that address, as well as other personal items belonging to him in the apartment. Harris’s cellphone revealed photographs of Harris in the same apartment with a large amount of currency only days before, as well as text messages indicating he was involved in the distribution of cocaine base that very week.
The sentence imposed on Harris was based not just upon the circumstances of his offense, but also his substantial criminal history, which rendered him a career criminal under federal law. Another factor the court considered in imposing sentence was the finding that Harris obstructed justice by testifying falsely at a hearing held during his trial.
This case was the product of an investigation by the United States Drug Enforcement Administration and the Sacramento Police Department. Assistant United States Attorneys Todd Pickles and Chris Highsmith prosecuted the case.
Rochester Man Charged with Enticement of A Minor and Production of Child PornogrpahyRead 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 Roger Eric Powell, 48, of Rochester, NY, was charged by criminal complaint with enticement of a minor and production of child pornography. Enticement of a minor carries a mandatory minimum sentence of 10 years in prison, a maximum of life and a fine of $250,000. Production of child pornography carries a mandatory minimum sentence of 15 years, a maximum of 40, and a $250,000 fine.Assistant U.S. Attorney Tiffany H. Lee, who is handling the case, stated that according to the complaint, on January 2, 2015, a complainant told law enforcement officers that her child, aged 14, had been engaging in sexually explicit communications with the defendant. When the child spoke with officers, the child advised that the two communicated on Facebook and that Powell sent two explicit images of himself to the child. The child also indicated that the defendant made multiple requests for explicit photos in return. In order to get the defendant to stop bothering the child, the child sent an explicit picture to Powell.
Law enforcement officers reviewed the child’s Facebook account and saw the exchanges between the defendant and the child. Officers then took over the Facebook account and engaged in communications with Powell. The defendant revealed in those communications about having engaged in prior sexual conduct with the child that was later confirmed by the child to law enforcement. A search warrant was executed at Powell’s residence and the defendant admitted to engaging in inappropriate communications with the child.
The criminal complaint is the culmination of an investigation on the part of the Federal Bureau of Investigation Child Exploitation Task Force. The Task Force includes members of the Rochester Police Department, under the direction of Chief Michael Ciminelli, the Monroe County Sheriff’s, under the direction of Sheriff Patrick O’Flynn, and Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent in Charge James C. Spero. .
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.
Qazi Brothers Charged with Additional Terrorism Violations and Attempted Murder of Two Deputy U.S. MarshalsRead the Press Release
Qazi brothers, naturalized U.S. citizens originally from Pakistan, were charged today with additional terrorism violations and attempted murder of two Deputy U.S. Marshals while the brothers were in custody.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, John Carlin, Assistant Attorney General for National Security, George L. Piro, Special Agent in Charge, FBI, Miami Field Office, and members of the South Florida Joint Terrorism Task Force (JTTF) made the announcement.
Raees Alam Qazi, 22, and Sheheryar Alam Qazi, 32, were previously charged in November 2012 with conspiracy to provide material support to terrorists and conspiracy to use a weapon of mass destruction (explosives).
As alleged in the Superseding Indictment:
From at least July 2011 through Nov. 29, 2012, the defendants conspired to provide material support and resources – including property, service, lodging, communications equipment, and personnel – knowing and intending that this support be used in preparation for and in carrying out a violation of law – namely, a conspiracy to use a weapon of mass destruction. The indictment further alleges that during this time frame the defendants conspired to use a weapon of mass destruction (explosives) against persons and property within the United States. During the same time frame, the indictment alleges that the Qazi brothers conspired and attempted to provide material support to al-Qa’ida and al-Qa’ida in the Arabian Peninsula.
As further alleged, on or about April 8, 2014, while being moved within the United States Courthouse complex, the Qazi brothers simultaneously motioned with their heads to cause the Deputy U.S. Marshals to look at the ceiling, the Qazi brothers then simultaneously punched the Deputies in the face and struggled with them.
Further, while struggling with the Deputy U.S. Marshals, the Qazi brothers attempted to use potentially lethal force on them while exclaiming “Allahu Akbar,” an Arabic exhortation meaning “God is Great.”
The Superseding Indictment charges the Qazi brothers with the following counts:
Conspiring to Provide Material Support to a Foreign Terrorist Organization, al-Qa’ida and al-Qa’ida in the Arabian Peninsula;
Attempting to Provide Material Support to a Foreign Terrorist Organization, al-Qa’ida and al-Qa’ida in the Arabian Peninsula:
Conspiring to Forcibly Assault a Federal Employee, a deputy United States Marshal;
Forcibly Assaulting a Federal Employee, a deputy United States Marshal; and
Attempting to Murder a Federal Employee, a deputy United States Marshal.
The charge of conspiring to provide material support to terrorists carries a maximum potential sentence of 15 years in prison. The charge of conspiracy to use a weapon of mass destruction carries a maximum potential sentence of life in prison. The charge of conspiring to provide and providing material support to a Foreign Terrorist Organization, al-Qa’ida and al-Qa’ida in the Arabian Peninsula, carries a maximum potential sentence of 15 years in prison.
The charge of conspiring to forcibility assault a federal employee carries a maximum potential sentence of 5 years in prison; the charge of forcibly assaulting a federal employee carries a maximum potential sentence of 20 years in prison; and the charge of attempting to murder a federal employee carries a maximum potential sentence of 20 years in prison.
The case is being investigated by the FBI’s South Florida Joint Terrorism Task Force. The case is being prosecuted by Assistant U.S. Attorneys Karen E. Gilbert and Adam Fels, of the U.S. Attorney’s Office for the Southern District of Florida, and Jennifer Levy, Trial Attorney, Counterterrorism Section of the Justice Department’s National Security Division.
An indictment contains mere allegations. Defendants are presumed innocent unless and until proven guilty in a court of law.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Previously Convicted Sex Offender Sentenced to over 17 Years in Prison for Distribution of Child PornographyRead the Press Release
Baltimore, Maryland – U.S. District Judge William D. Quarles, Jr. sentenced Brian P. Davis, age 50, of Dundalk, Maryland, today to 210 months in prison, followed by lifetime supervised release, for distribution of child pornography. Judge Quarles ordered that upon his release from prison, Davis 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). In 1998, Davis was convicted of the sexual abuse of a minor in the Circuit Court of Baltimore County and as a result was required to register as a sex offender.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; Special Agent in Charge William Winter of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Colonel Marcus L. Brown, Superintendent of the Maryland State Police; Chief James W. Johnson of the Baltimore County Police Department; and Baltimore County State’s Attorney Scott Shellenberger.
According to Davis’ plea agreement, in 2005 he began using a file sharing network to search for, receive and distribute child pornography. Such networks are used to exchange and share files directly between computer users. On November 24, 2013, an undercover Baltimore County Police detective used a computer connected to the internet to conduct an investigation into the sharing of child pornography. The detective downloaded an image depicting a minor engaging in sexually explicit conduct from a user who was making files containing child pornography available for others to download. The user sharing files was subsequently identified as Davis and a search warrant was executed at Davis’ residence on December 11, 2013. When officers from the Baltimore County Police Department entered the residence to conduct the search, they found Davis’ desk top computer in the basement. The computer was on and running a file sharing network. A detective conducted a forensic preview of the computer and located images depicting children engaged in sexually explicit conduct. A full forensic examination of the computer found more than 600 images of child pornography, including images depicting 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.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, HSI Baltimore, Maryland State Police Internet Crimes Against Children Task Force, Baltimore County Police Department and Baltimore County State’s Attorney’s Office for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Zachary A. Myers and Judson T. Mihok, who prosecuted the case.
Pittsburgh Man Pleads Guilty to Child Pornography ChargeRead the Press Release
PITTSBURGH – An Allegheny County man pleaded guilty in federal court to a charge of receipt of material depicting the sexual exploitation of a minor, United States Attorney David J. Hickton announced today.
James Kerkan, 49, of Pittsburgh, Pa., pleaded guilty to one count before United States District Judge Cathy Bissoon.
In connection with the guilty plea, the court was advised that from on or about Aug. 13, 2014, and continuing until on or about Sept. 3, 2014, Kerkan received images and videos containing material depicting the sexual exploitation of minors.
Judge Bissoon scheduled sentencing for April 30, 2015, at 2:00 p.m. The law provides for a total sentence of 20 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Jessica Lieber Smolar is prosecuting this case on behalf of the government.
The Pittsburgh Bureau of Police, Federal Bureau of Investigation, and the Allegheny County District Attorney’s Office conducted the investigation that led to the prosecution of Kerkan.
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.
Physician-Owned Forest Park Medical Center to Pay $215,000 to Resolve Kickback Allegations Under Civil Settlement with United StatesRead the Press Release
Forest Park Medical Center, LLC (“FPMC”), a physician-owned hospital located in Dallas, Texas, will pay $215,000 under a civil settlement with the United States Department of Justice, announced Acting United States Attorney Richard L. Durbin, Jr. The settlement resolves allegations that the hospital paid kickbacks in exchange for referrals of patients covered by the federal workers’ compensation program, known as FECA.
FECA, a federal health care program administered by the United States Department of Labor (“DOL”), provides workers’ compensation benefits to federal workers who suffer job-related injuries. The program covers roughly 3 million federal civilian and postal employees. Benefits include payment of a covered worker’s medical and rehabilitation expenses. DOL uses federal funds to reimburse health care providers that treat injured workers covered by FECA.
The Department of Justice investigated whether FPMC violated the Anti-Kickback Statute, 42 U.S.C. § 1320a-7b(b), and submitted false claims for reimbursement to the FECA program in violation of the False Claims Act, 31 U.S.C. §§ 3729-3733. Between August 1, 2011 and March 1, 2012, FPMC caused payments to be made to individuals and entities located in the Western District of Texas for “marketing” and “management” services. The United States contends that these payments were, in reality, unlawful kickbacks made in exchange for the referral of patients covered by FECA in violation of the Anti-Kickback Statute. The United States further contends that, by billing the FECA program for services rendered to patients whose referrals were secured through kickbacks, FPMC submitted false claims for payment to the DOL in violation of the False Claims Act, which provides for treble damages and civil penalties.
Under the settlement announced today, FPMC will pay $215,000 to resolve the hospital’s potential False Claims Act liability. The settlement, which follows an earlier resolution reached with the United States Attorney’s Office for the Northern District of Texas regarding claims submitted to the TRICARE program, is not an admission of liability by FPMC or its affiliates. FPMC cooperated with the government’s investigation.
Acting United States Attorney Durbin commended the efforts of the investigating agencies, including the United States Postal Service -- Office of the Inspector General, United States Army Criminal Investigation Division -- Major Procurement Fraud Unit, Federal Bureau of Investigation, and the United States Department of Labor -- Office of the Inspector General. Assistant United States Attorney John J. LoCurto and Auditor Jamie Cole, CPA handled the investigation for the United States Attorney’s Office.
Physical Therapy Clinic Owner and Employee Sentenced for FraudRead the Press Release
BOSTON – The owner and operator of a Brockton physical therapy company and her employee were sentenced today for defrauding insurance companies in connection with physical therapy services purportedly provided to patients involved in car accidents.
Walkyrie Massie, a/k/a Vicky Lopes, 39, and Edward Rossi, 65, of Rochester, were sentenced by U.S. District Court Judge Richard G. Stearns to 30 months and 18 months, respectively, two years of supervised release, and ordered to pay $174,597 in restitution to the defrauded insurance companies. Massie and Rossi pleaded guilty to conspiracy to commit mail fraud and two counts of mail fraud in September and August 2014, respectively.
“The scam perpetrated by Massie and her employees defrauded insurance companies and deprived injured patients of proper care,” said U.S. Attorney Carmen M. Ortiz. “Patients deserve quality care and insurance providers need honest care-givers. This kind of fraud is corrosive to our healthcare system.”
“Westgate Physical Therapy was solely motivated by profit rather than patient care when it forged patient records and billed for medical care never provided scamming private insurance companies out of hundreds of thousands of dollars,” said Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division. “The FBI is dedicated to aggressively investigating this type of criminal activity because it has a great impact not only on private insurance companies but on the economy as a whole as well.”
Massie, the owner and operator of Westgate Physical Therapy in Brockton, and her employees submitted fraudulent medical progress notes to insurance companies, in connection with physical therapy the company purportedly provided to patients involved in car accidents. Specifically, Rossi, a licensed physical therapy assistant, was supposed to provide physical therapy to patients several times a week until the physical therapist, Deidre Chouinard, re evaluated the patient and signed off that the treatment was complete. Westgate would then send a bill to the responsible insurance company. The progress notes contained in the patients’ chart would also be used to determine personal injury protection payments, as well as any bodily injury settlements with other insurance companies.
In reality, for the majority of patients, Rossi simply filled in cookie-cutter treatment notes for patients who either never showed up that day, came into the clinic for mere minutes, or were not seen at all by Rossi because he was not present. Furthermore, Rossi signed notes for treatments that Massie performed, even though she was not licensed to do so. Based on these fraudulent submissions, from 2009 to 2011, Westgate billed insurance companies more than $400,000 and received more than $174,000 in payments.
During the investigation into Westgate’s activities, federal law enforcement used a cooperating witness, who claimed to have been in a car accident and sought treatment at Westgate. From March through June 2011, recordings made of this individual’s visits to Westgate captured how Massie boasted about forging the individual’s name to the sign-in sheets to falsely show that he had come in for treatment when he had not. In one recorded conversation, Rossi can be heard demonstrating how the therapy exercise equipment worked so that the individual would be able to describe the physical therapy if he were called in to give a statement to the insurance company about his injuries and treatment at Westgate.
In December 2014, Chouinard, Westgate’s physical therapist, was sentenced to three years of probation. A fourth defendant is awaiting trial.
U.S. Attorney Ortiz and SAC Lisi made the announcement today. The Massachusetts Insurance Fraud Bureau also assisted in this investigation. The case was prosecuted by Assistant U.S. Attorney Shelbey Wright.
Payroll Service Company Owners Indicted for Theft of over $2.5 Million Set Aside by Clients to Pay Federal and State TaxesRead the Press Release
AccuPay Owners Allegedly Stole Money Designated for IRS and Maryland Tax Agency
Baltimore, Maryland – A federal grand jury indicted Beverly Carden, age 53, and her husband Kevin Carden, age 54, both formerly of Bel Air, Maryland, yesterday on charges arising from a scheme to steal at least $2.5 million from their clients and the IRS.The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Thomas J. Kelly of the Internal Revenue Service - Criminal Investigation, Washington, D.C. Field Office; and Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation.
“The indictment alleges that the defendants falsely told clients that their money was being used to pay their taxes, when in fact the defendants were stealing it,” said U.S. Attorney Rod J. Rosenstein. “Customers who hire payroll services companies expect that they will not have to worry, but this case is a reminder that people always need to be vigilant when they trust someone with their money.”
The defendants owned and operated AccuPay, Inc., a payroll service company located at 206 E. Churchville Road in Bel Air. Part of the payroll services that AccuPay offered to its clients was to complete and file federal and state tax returns, collect the funds from the clients to pay the taxes, and then pay those taxes to the taxing authorities. Beverly Carden oversaw all aspects of AccuPay’s business. Kevin Carden was responsible for inserting the clients’ payroll information into software that generated tax forms to be filed with the taxing authorities and for paying the clients’ employment taxes.
According to the 16 count indictment, from 2006 to March 2013, the defendants withdrew from the clients’ funds the full amount of taxes owed, but then paid the taxing authorities only a portion of such funds, fraudulently retaining at least $2.5 million for themselves. The defendants misrepresented to their clients that those funds had been paid to the relevant taxing authorities.
The indictment alleges that in order to keep the clients unaware that their taxes were not fully paid, Kevin Carden changed the address listed for certain clients to the address for AccuPay, without the clients’ consent, causing all future IRS correspondence, including notices of underpayment, to be sent to AccuPay rather than the client. In the instances in which clients received notice from the taxing authority that they had not paid the taxes they owed in full, the defendants falsely advised the clients that the underpayment was due to a mistake by the taxing authority, an error made by AccuPay employees or the software AccuPay used to file tax returns.
The indictment further alleges that to contact the IRS about her clients’ employment tax issues without her clients’ knowledge, Beverly Carden affixed or caused to be affixed client signatures on IRS power of attorney forms without the clients’ permission.
In late 2011, the defendants allegedly sent their clients a letter introducing a new chief financial officer (CFO) at AccuPay who was to audit all tax deposits and filings for all tax clients back to 2009 for compliance and correctness. The letter stated that the CFO was an Ivy League graduate with degrees in both accounting and law, who had over 30 years experience as a CPA, was formerly a special investigator with the New Jersey Attorney General’s office, as well as a former IRS Special Agent. The CFO was not identified by name. Beverly Carden made a similar representation in a letter to the office of a U.S. Congressman in which she attempted to explain difficulties that AccuPay was having with the IRS. Although the defendants did hire a CPA who was a former IRS revenue agent and former investigative auditor for the New Jersey Attorney General’s Office, who had attended but not graduated from an Ivy League institution, that individual was hired to prepare the defendants’ personal tax returns and AccuPay’s corporate tax returns – not to audit any payments or filings made on behalf of AccuPay’s clients.
Finally, the indictment alleges that the defendants filed a false individual tax return for 2011 in which they substantially understated their income, that Kevin Carden filed a false individual tax return for 2012 in which he substantially understated his income, and Beverly Carden failed to file a tax return for 2012.
The indictment seeks forfeiture of at least $2.5 million.
The defendants face a maximum sentence of 20 years in prison for conspiracy to commit mail and wire fraud; 20 years in prison on each of three counts of mail fraud and five counts of wire fraud; 10 years in prison for conspiracy to commit money laundering and on each of three counts of money laundering; three years in prison on each of two counts for filing a false tax return and one year for failing to file a tax return. The defendants are expected to have their initial appearances in federal court in Florida today and tomorrow.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
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 IRS - Criminal Investigation and FBI for their work in the investigation. Mr. Rosenstein praised the Bel Air Police Department for their assistance in the investigation, and thanked Assistant U.S. Attorney Evan T. Shea, who is prosecuting the case.
Orlando Man Sentenced to More than 13 Years for Robbing Credit UnionRead the Press Release
Orlando, FL – Chief U.S. District Judge Anne C. Conway today sentenced Joseph Cotto-Diaz (31, Orlando) to 13 years and 5 months in federal prison for aiding and abetting a credit union robbery with assault, and aiding and abetting the use and carrying of a firearm during that robbery. As part of his sentence, Cotto-Diaz was also ordered to pay restitution to his victims.
Cotto-Diaz pleaded guilty on October 1, 2014.
According to testimony and court documents, on the morning of January 25, 2012, Cotto-Diaz and three co-conspirators, including Raulier Rivas Lopez (29, Orlando), robbed the American Eagle Credit Union located at 7007 SeaWorld Drive, in Orlando. Cotto-Diaz, Lopez, and another co-conspirator, all wearing masks, entered the credit union and demanded money from the employees. Lopez pointed an AK-47-style rifle at the employees as Cotto-Diaz pepper-sprayed them. Approximately $7,000 was taken during the robbery.
After fleeing the credit union in a stolen van, the men drove to a nearby hotel parking lot and abandoned the vehicle. They then ran through a pre-cut hole in a chain-link fence, and met another co-conspirator who was waiting in a getaway car.
Lopez pleaded guilty on June 10, 2014, and was sentenced on September 11, 2014, to 14 years in federal prison.
This case was investigated by the Federal Bureau of Investigation and the Orange County Sheriff’s Office. It was prosecuted by Assistant United States Attorney Joseph M. Schuster.
Oakley Man Pleads Guilty to Attempted Sexual Exploitation of a Minor ChildRead the Press Release
Defendant Admits he Attempted to Produce Child Pornography
POCATELLO - Ray Carl Short, 66, of Oakley, Idaho, pleaded guilty today to attempted sexual exploitation of a minor child, U.S. Attorney Wendy J. Olson announced. Olson said that as a part of his plea, Short admitted using a hidden security camera to attempt to capture images of a minor victim engaged in sexually explicit conduct. Short was charged by Information in Pocatello on December 22, 2014.
According to the plea agreement, a special agent with Homeland Security Investigations (HSI), Wilmington, Delaware, utilized a covert account on a peer-to-peer network to download 26 child pornography images and videos from Short in January 2014. In July, law enforcement agents searched Short’s residence pursuant to a federal search warrant and seized a laptop computer, a Brickhouse Security camera, and other related items. A forensic analysis of the laptop and other electronic media revealed approximately 2,934 images and 144 video files of suspected child pornography. The National Center for Missing and Exploited Children identified the victims in 345 of the images, 16 of the video files, and in 64 documented “Series” of child pornography.
In a folder located on Short’s computer hard drive and named for an additional minor victim, law enforcement agents found six video files and nine image files of the victim, several of which depicted the minor engaged in sexually explicit conduct. Additional similar videos and images of the victim were located in sub-folders. A review of the security camera’s memory card revealed recently recorded video files of the victim nude and getting ready for bed, and of the defendant placing the camera in, and retrieving it from, concealed locations of the victim’s bedroom.
On the day of the search warrant execution, Short admitted to having downloaded and received images that would be illegal or constitute child pornography and that there were images of child pornography on his laptop. In court, Short also admitted that he placed the Brickhouse camera in hidden locations in order to use the victim to take part in sexually explicit conduct for the purpose of producing visual depictions of such conduct.
The charge of attempted sexual exploitation of a minor is punishable by 15 to 30 years in prison, a maximum fine of $250,000, and a term of supervised release of five years to life.
Sentencing is set for April 8, 2015, before U.S. Chief District Judge B. Lynn Winmill at the federal courthouse in Pocatello.
The case was investigated by the U.S. Immigration and Custom Enforcement’s (ICE) Homeland Security Investigations (HSI), with the assistance of the Cassia County Sheriff’s Office and Cassia County Prosecutor’s Office.
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.”
Northern District of Iowa U.S. Attorney's Office Collects $3,760,255.36 in Civil and Criminal Actions for U.S. Taxpayers in Fiscal Year 2014Read the Press Release
Contact: Steve Young
United States Attorney Kevin W. Techau announced today that the Northern District of Iowa collected $3,760,255.36 in criminal and civil actions in the fiscal year ending September 30, 2014 (FY 2014). Of this amount, $1,611,824.88 was collected in criminal actions and $2,148,430.48 was collected in civil actions.
Attorney General Eric Holder announced on November 19, 2014 that the Justice Department collected $24.7 billion in civil and criminal actions in FY 2014.
The more than $24 billion in collections in FY 2014 represents nearly eight and a half times the appropriated $2.91 billion budget for the 94 U.S. Attorney’s offices and the main litigating divisions in that same period.
“Every day, the Justice Department’s federal prosecutors and trial attorneys work hard to protect our citizens, to safeguard precious taxpayer resources, and to provide a valuable return on investment to the American people,” said Attorney General Holder. “Their diligent efforts are enabling us to achieve justice and recoup losses in virtually every sector of the U.S. economy. And this result shows the fruits of the Justice Department’s tireless work in enforcing federal laws; in protecting the American people from violent crime, national security threats, discrimination, exploitation, and abuse; and in holding financial institutions accountable for their roles in causing the 2008 financial crisis.”
United States Attorney for the Northern District of Iowa, Kevin W. Techau reinforces the importance of these actions indicating, “These collections are a vital part of our mission to vindicate crime and hold accountable those who wrongfully profit at the expense of the United States. This office is dedicated to recovering funds for the federal treasury and for victims of federal crime.”
The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.
The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education.
Additionally, the U.S. Attorney’s Office in the Northern District of Iowa, working with partner agencies and divisions, collected $541,517.00 in asset forfeiture actions in FY 2014. Forfeited assets deposited into the Department of Justice Assets Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes.
Niagara Falls Man Arrested, Charged with Sex Trafficking of A Minor and Transportation of A Minor to Engage in Criminal Sexual ActivityRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051
BUFFALO, N.Y. U.S. Attorney William J. Hochul, Jr. announced today that Marcellus Overton, 39, of Niagara Falls, NY, was arrested and charged with sex trafficking of a minor and transportation of a minor to engage in criminal sexual activity. The charges carry a mandatory minimum of 10 years in prison and a maximum of life.Assistant U.S. Attorney John E. Rogowski, who is handling the case, stated that according to the indictment, between December 2012 and March 2013, the defendant knowingly enticed a victim under 18 years old to engage in a commercial sex act. The complaint further states that in March 2013, Overton knowingly transported a minor under 18 years old between New York and Georgia to engage in prostitution.
The defendant made an initial appearance on January 14, 2015 before U.S. Magistrate Judge Hugh B. Scott and is being detained. A detention hearing is scheduled for January 16, 2015.
“Each year, thousands of women and men become the victims of human trafficking in the United States,” said U.S. Attorney Hochul. “Whether forced into labor or commercial sexual exploitation, the lives of these victims are forever impacted. But our Office, working side by side with our law enforcement partners, is aggressively prosecuting all forms of trafficking wherever they occur. The Human Trafficking Task Force also includes non-government agencies who partner with us to effectively address this serious criminal activity.”
"The disturbing allegations in this case and cases like it serve to heighten the resolve of law enforcement in the effort against traffickers," said ICE HSI Special Agent in Charge Spero. " Sadly, many trafficking victims remain hidden in plain sight-- going unnoticed or unreported, which is why it is critical that we continue to raise awareness so more victims are identified and rescued and more exploiters are brought to justice."
The criminal complaint is the culmination of an investigation by Immigration and Customs Enforcement, Homeland Security investigations, under the direction of Special Agent in Charge James C. Spero.
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.
January is Human Trafficking Awareness Month. Every year, thousands of vulnerable persons, including women and children, are trafficked into the United States, threatened and beaten, and forced to perform services of a sexual nature against their will. Every year, thousands of workers and laborers are exploited and abused by employers. The exploitation of vulnerable individuals is an affront to fundamental human rights, and will not and cannot be tolerated. The Department of Justice and U.S. Attorney’s Offices are committed to the prosecution of human trafficking cases, and will continue to hold traffickers accountable for these heinous crimes.
New York Business Must Pay $3.5 Million for Trafficking Contraband CigarettesRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a retail business operating on a reservation in the state of New York pleaded guilty in federal court today to its role in a conspiracy to commit wire fraud and contraband cigarette trafficking, for which it must pay a total of more than $3.5 million in fine, forfeiture and restitution.
TSNE, doing business as Jan’s Smoke Shop, in Bascom, New York, a gas station and convenience store business recognized by the Tonawanda Seneca Nation, pleaded guilty before U.S. District Judge Brian C. Wimes.
TSNE participated in the conspiracy from September to November 2011 by ordering contraband cigarettes from co-conspirators and causing those cigarettes to be transported into the state of New York. New York pre-collects an excise tax of $4.35 per pack of cigarettes from wholesalers for sales to Indian nations and tribes. Federal and New York state law requires that tax stamps be affixed to cigarette packages – prior to their sale to consumers – reflecting that the required state taxes have been paid.
As part of this conspiracy, New York’s state excise tax of $4.35 per pack was not paid. As a result, TSNE’s foreseeable amount of total excise tax loss to the state of New York is approximately $1,900,080. Federal law enforcement agents reviewed invoices and other records and determined that TSNE made a profit of $700,650 on the sale of the contraband cigarettes.
Under the terms of today’s plea agreement, TSNE must pay a fine of $950,000, a money judgment to the government of $700,650 and restitution to the state of New York in the amount of $1,900,080. The total amount of fine, forfeiture and restitution is $3,550,730.
TSNE must also serve two years of probation. During that time, Jan's Smoke Shop will be prohibited from buying and selling any cigarettes (including premium brands and native brands), wholesale or otherwise. The government will dismiss the charges against Tara Sundown (who operated Jan’s Smoke Shop) contained in an Aug. 12, 2013, federal indictment.
According to the indictment, conspirators purchased more than $17 million worth of contraband cigarettes from ATF agents during an undercover operation in the Kansas City metropolitan area. Approximately 201,340 cartons of cigarettes – containing 10 packs per carton – were transported to New York without paying the required $4.35 per pack excise tax. The untaxed cigarettes were sold by New York retailers and smoke shops on the reservations in the state of New York. The total state excise tax lost to the state of New York was more than $8 million.
In addition to the federal indictment, the undercover operation resulted in a $3.5 million civil forfeiture. Following the seizures that occurred as a result of the investigation, the U.S. Attorney’s Office started a $3.5 million civil forfeiture case naming the assets taken up to that point. On Oct. 23, 2012, the court entered a default order of forfeiture for more than $2 million seized from bank accounts and by agents, more than 300 cases of seized cigarettes, a 2009 Cessna T206H Stationair aircraft, two 2012 Peterbilt 389 trucks and two 2012 Peterbilt 386 trucks. The seized cigarettes have been sold at auction for $532,500. The 2009 Cessna Aircraft has been sold for $450,000. The four trucks have been sold for the following amounts: $115,000; $115,000; $113,000; and $113,000. The civil case has been stayed pending the resolution of the criminal case.
In a related case, AJ’s Candy & Tobacco, LLC, a tobacco wholesaler located on a reservation in Irving, N.Y., pleaded guilty to its role in the conspiracy and has been sentenced. The court ordered AJ’s to pay a $1 million fine. The company also must forfeit to the government $221,550, which represents the proceeds of the offense. The court also ordered the company to pay an additional $535,050 in restitution to the state of New York. Under the terms of the company’s plea agreement, AJ’s is prohibited from selling premium cigarettes for two years.
This case is being prosecuted by Assistant U.S. Attorneys Paul S. Becker and Justin G. Davids. It was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, IRS – Criminal Investigation, the Federal Deposit Insurance Corporation – Office of Inspector General and the Kansas City, Mo., Police Department.
New Trial Date Set for Michael 'the Situation' Sorrentino and Marc SorrentinoRead the Press Release
Brothers Indicted for Tax Crimes Involving $8.9 Million in Income
NEWARK, N.J. - A new trial date has been set for television personality Michael “The Situation” Sorrentino and his brother, Marc Sorrentino, on charges they did not properly pay taxes on $8.9 million in income Michael Sorrentino received from promotional activities, U.S. Attorney Paul J. Fishman announced.
U.S. District Judge Susan D. Wigenton issued a complex case designation and a continuance order that sets the matter down for trial on Sept. 14, 2015.
The Sorrentinos are charged with one count of conspiracy to defraud the United States. Marc and Michael Sorrentino also are charged with three and two counts, respectively, of filing false tax returns for 2010 through 2012. Michael Sorrentino faces an additional count for allegedly failing to file a tax return for 2011. The original trial date was March 2, 2015.
The government is represented by Assistant U.S. Attorney Jonathan W. Romankow of the U.S. Attorney=s Office Criminal Division in Newark, and Trial Attorney Tino Lisella of the Tax Division of the U.S. Department of Justice.
The charges and allegations contained in the indictment are merely accusations, and the defendants are considered innocent unless and until proven guilty.
15-017Defense counsel: Michael Sorrentino: Richard Sapinski Esq., Newark
Marc Sorrentino: Chris Adams Esq., Colts Neck, N.J.Sorrentino, Michael and Marc Continuance Order
Morris County, New Jersey, Man Admits Receiving Images of Child PornographyRead the Press Release
NEWARK, N.J. – A Boonton, New Jersey, man today admitted using a computer in his home to download images of child sexual abuse, U.S. Attorney Paul J. Fishman announced.
Lucas J. Reinmann, 35, pleaded guilty today before U.S. District Judge Susan D. Wigenton to an information charging him with one count of knowingly receiving images of child pornography over the internet.
According to documents filed in this case and statements made in court:
Reinmann admitted that he downloaded images and videos of child sexual abuse from the internet to his computer using a peer-to-peer file sharing network. He also admitted possessing more than 600 images of child sexual abuse on his computers and USB drives, which were seized from his residence in July 2013.
The count to which Reinmann pleaded guilty carries a mandatory minimum penalty of five years in prison and a maximum potential penalty of 20 years in prison, followed by a mandatory minimum of five years of supervised release and a $250,000 fine. Sentencing is scheduled for April 20, 2015.
U.S. Attorney Fishman credited special agents of Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), Newark Division, under the direction of Acting Special Agent in Charge John P. Woods; the Morris County Prosecutors Office, under the direction of Prosecutor Fredric M. Knapp; and the Boonton Township Police Department, under the direction of Chief Paul C. Fortunato with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Sara F. Merin of the U.S. Attorney’s Office OCDETF Unit in Newark.
15-019Defense counsel: Edward V. Sapone Esq., New York
Middletown Man Charged Federally with Receipt and Possession of Child PornographyRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced a Criminal Information has been filed in United States District Court in Harrisburg charging Steven Alan Shepherd, age 30, of Middletown, with receipt and possession of child pornography.
According to U.S. Attorney Peter Smith, as a result of a search of Shepherd’s home on May 1, 2014 thousands of images of child pornography were discovered and seized. Shepherd allegedly received the material via a computer in 2010.
The Criminal Information also seeks forfeiture of computer equipment and accessories involved or used in connection with the offense.The government also filed a plea agreement which is subject to approval by the court. The offense carries a mandatory minimum of five years imprisonment and a $250,000 fine.
This case was investigated by the United States Postal Inspection Service and the Pennsylvania State Police and is being prosecuted by Assistant United States Attorney Daryl F. Bloom.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
Mexican national sentenced to two years for illegal reentryRead the Press Release
MARTINSBURG, WEST VIRGINIA – Mexican national Rogelio Portillo Vasquez, 38, was sentenced to 24 months in prison today for illegal reentry into the country, United States Attorney William J. Ihlenfeld, II, announced today.
Portillo Vasquez was previously deported to Mexico in May 2012. In September 2014, authorities discovered that he was in Jefferson County, West Virginia without permission. He pled guilty in December 2014 one count of “Re-entry by a Removed Alien.”
Assistant U.S. Attorney Paul Camilletti prosecuted the case on behalf of the government. U.S. Immigration and Customs Enforcement investigated.
U.S. District Judge Gina M. Groh presided.
Members of Mail Theft Ring Sentenced to 42 Months in PrisonRead the Press Release
Anchorage, Alaska – Acting U.S. Attorney Kevin Feldis announced today that an Anchorage woman has been sentenced in federal court in Anchorage for bank fraud and aggravated identity theft.
Elizabeth Ingalsbe, 45, of Anchorage, was sentenced today by United States District Court Judge Sharon L. Gleason, to 42 months in prison.
According to Assistant U.S. Attorney Aunnie Steward, Ingalsbe, as a member of a mail theft ring in Anchorage, cashed checks at the bank that had been stolen from victims’ mailboxes. The checks were altered to indicate a false payee and to increase the payment amount. The stolen checks included payments for rent, insurance premiums, a donation to a veteran’s memorial, and bill payments. The amounts were generally $100 or less and were falsely increased to $900 before Inglasbe cashed the checks. Ingalsbe victimized approximately 21 individuals and organizations.
The court noted Ingalsbe’s lengthy criminal history and the emotional impact to the victims who indicated that the safety and security in their home and community had been compromised by these crimes as reasons for the sentence imposed.
Acting U.S. Attorney Kevin Feldis stated, “Identity theft is a worldwide problem that can have devastating impact on its victims. In this case, the defendant victimized over 20 local citizens, putting their bank accounts, credit ratings, reputations and good names at risk. It is appropriate that the sentence imposed is significant and serves to deter others from committing similar crimes.”
United States Attorney Karen L. Loeffler commends the United States Postal Inspection Service for the investigation of this case.Manhattan U.S. Attorney Obtains More Than $300,000 in Judgments Against Seven Participants in Scheme to Defraud Federal Government into Paying for Tutoring Services That Were Never ProvidedRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today that the United States has obtained civil judgments against seven former employees of The Academic Advantage (“Academic Advantage”) in connection with their role in a scheme whereby Academic Advantage fraudulently obtained federal funds for tutoring services that it never provided. During the relevant period, Academic Advantage participated in a federally funded program pursuant to which it was to provide after-school tutoring to students attending underperforming New York City public schools. The civil judgments are against: (1) JASON ISAACS, an Executive Director of Academic Advantage and the senior-most official overseeing its New York City tutoring program; and (2) six individuals who supervised Academic Advantage’s tutoring program at particular New York City public schools — AYESHA YOUNG, ARLETTE HERNANDEZ, RAYVON JONES, TERESA OSORIO, ALICIA MCKAY, and KRISTIN JOYNER. The judgments against ISAACS, YOUNG, HERNANDEZ, JONES, OSORIO, MCKAY, and JOYNER are for $185,000, $33,308, $27,867, $24,951, $23,616, $20,838, and $20,412, respectively. U.S. District Judge Lewis A. Kaplan endorsed some of the judgments on January 14, 2015, and others on January 12, 2015. The above-referenced judgments are in addition to the more than $2.1 million in settlements and judgments that this Office previously obtained against Academic Advantage and three of its other former employees, Edwin Guzman, Luz Mercedes and Nilsa Dalmasi.
Manhattan U.S. Attorney Preet Bharara said: “With these judgments against seven more former employees of Academic Advantage for their roles in a scheme to fraudulently bill the government for tutoring services that were never provided, we continue our push to clean up corruption in the tutoring of our school kids. Today’s judgments should serve as a reminder that when companies engage in fraud, we will seek to hold those responsible accountable.”
According to the Government’s previously filed pleadings against Academic Advantage and the above-named individuals, as well as other documents filed in Manhattan federal court (including a settlement agreement between the Government and ISAACS):
From 2010 through 2012 (“Covered Period”), the New York City Department of Education (“NYCDOE”) received funds from the federal government to pay for Supplemental Educational Services (“SES”), which included after-school tutoring for students attending underperforming public schools. The NYCDOE entered into contracts with private entities to provide SES tutoring to students in New York City public schools. Students were eligible to receive SES tutoring if they met certain criteria, such as attending a school that had been identified as needing improvement or restructuring for at least two years. Private entities contracted by the NYCDOE to provide SES tutoring were required to have each student who attended a tutoring class sign a daily attendance sheet. A representative from the entity was also required to sign each attendance sheet, certifying that SES tutoring had been provided to all of the students whose signatures appeared on the attendance sheet.
Academic Advantage
During the Covered Period, Academic Advantage contracted with the NYCDOE to provide SES tutoring to students in New York City. Academic Advantage employed individuals whom it referred to as “Site Managers” to supervise its SES program at particular New York City public schools. The Site Managers supervised other employees, known as “Program Aides,” who were also assigned to those schools. Employees with the title “Director” supervised the Site Managers and Program Aides. The Directors reported to an “Executive Director” of Academic Advantage, the highest ranking official overseeing Academic Advantage’s New York City SES program.
During the Covered Period, ISAACS was the Executive Director, YOUNG was a Director, and HERNANDEZ, JONES, OSORIO, MCKAY, and JOYNER were Site Managers.
The Fraudulent Scheme
During the Covered Period, Academic Advantage obtained federal funds by falsely reporting that it had provided SES tutoring to certain students when no SES tutoring had, in fact, been provided to those students. As part of the scheme, Academic Advantage repeatedly submitted to the NYCDOE bills for students who had not actually received any tutoring.
In his settlement agreement with the Government, ISAACS admitted that throughout the Covered Period, Site Managers, Program Aides, and Directors engaged in the following fraudulent conduct in connection with Academic Advantage’s New York City SES program:
- Site Managers routinely forged student signatures on daily student attendance sheets to make it appear that more students had attended Academic Advantage’s SES tutoring classes than had, in fact, attended;
- Site Managers instructed Program Aides to forge student signatures on daily student attendance sheets;
- Program Aides followed the instructions they received from those Site Managers and forged student signatures on daily student attendance sheets;
- Site Managers and Program Aides instructed students to sign daily student attendance sheets for SES tutoring classes that those Site Managers and Program Aides knew the students either had not attended or would not be attending;
- Site Managers routinely signed false certifications on daily student attendance sheets, falsely certifying that after-school tutoring had been provided to all of the students whose purported signatures appeared on the sheets, even though those Site Managers knew that tutoring had not been provided to many of those students; and
- Some Directors knew — and others deliberately ignored or recklessly disregarded — that Site Managers and Program Aides were forging student signatures on daily student attendance sheets or otherwise falsifying student attendance records.
ISAACS further admitted that, during the Covered Period, he had access to information suggesting that Site Managers and/or Program Aides were forging student signatures on daily student attendance sheets and failed to investigate instances of potential forgeries. In addition, ISAACS admitted that Academic Advantage used the above-referenced falsified daily student attendance sheets to prepare invoices that it then submitted in connection with its SES tutoring program. Those invoices ultimately resulted in Academic Advantage being paid federal funds for SES tutoring that it never provided.
In addition to obtaining more than $2.4 million in civil settlements and judgments against Academic Advantage and its former employees, this Office has brought criminal actions against several of those former employees, including Guzman and Mercedes, who have pled guilty to criminal fraud charges.
This is the third coordinated proceeding this Office has pursued against New York City SES providers and their employees for falsifying attendance records and billing for tutoring they did not provide. In 2012 and 2013, this Office filed civil charges against The Princeton Review, Inc. (“Princeton Review”), and civil and criminal charges against several of its former employees. In 2013, this Office filed civil charges against TestQuest, Inc. (“TestQuest”), and civil and criminal charges against several of its former employees. Princeton Review settled the civil charges against it by admitting misconduct and committing to pay the Government up to $10 million. TestQuest settled with the Government for $1.75 million and admissions of wrongdoing. The following former employees of Princeton Review and TestQuest have pled guilty to criminal fraud charges, settled civil fraud charges, or both: Robert Stephen Green, Ana Azocar, Zorayma Azocar, Michael Logan, and Sandra Allen. In addition, Sylvia Brathwaite, a former employee of TestQuest, has had a default judgment entered against her.
Mr. Bharara thanked the U.S. Department of Education Office of the Inspector General for its extraordinary assistance in this case.
The above-referenced civil matters are being handled by the Civil Frauds Unit, and the criminal matters are being handled by the Complex Frauds Unit. Assistant U.S. Attorney Christopher B. Harwood is in charge of the matters.
Manhattan U.S. Attorney Announces Guilty Pleas of Former U.S. Soldier and Former German Soldier for Conspiracy to Murder A Dea Agent and Conspiracy to Import CocaineRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced the guilty pleas of TIMOTHY VAMVAKIAS, a former member of the U.S. Army, and DENNIS GOGEL, a former member of the German armed forces, to charges that include conspiracy to murder an agent of the Drug Enforcement Administration (“DEA”) and conspiracy to import cocaine into the United States. VAMVAKIAS and GOGEL, who were arrested in September 2013 along with co-defendants Joseph Hunter, Slawomir Soborski, and Michael Filter following a long-term DEA undercover investigation, each pled guilty before U.S. District Judge Laura Taylor Swain. VAMVAKIAS pled guilty on Friday, January 9, 2015, and GOGEL pled guilty on Tuesday, January 13, 2015.
Manhattan U.S. Attorney Preet Bharara said: “Timothy Vamvakias and Dennis Gogel have now admitted their roles in a mercenary international narcotics and murder-for-hire conspiracy. These two former members of their countries’ armed forces traded patriotism for profit, plotting to murder a DEA agent and a witness, and facilitating the importation of cocaine, for a promised payoff. Now they face the prospect of lengthy prison terms.”
According to the Indictment filed against VAMVAKIAS, GOGEL, Hunter, Soborski, and Filter, and statements made at the plea proceedings:
All five defendants have previously served in the armed forces of their respective nations. VAMVAKIAS served in the U.S. Army between approximately 1991 and 2004; GOGEL served in the German armed forces between approximately 2006 and 2010; Hunter served in the U.S. Army between approximately 1983 and 2004; Filter served in the German armed forces between approximately 2006 and 2010; and Soborski served in the Polish armed forces between approximately 1998 and 2011. VAMVAKIAS attained the rank of sergeant and served both as infantryman and a military police officer. GOGEL was trained as a sniper. Hunter served as a sniper instructor and a senior drill sergeant, training other soldiers in marksmanship and tactics; and Soborski and Filter were also trained as snipers.
In 2013, VAMVAKIAS and GOGEL were recruited by Hunter to serve as security for a Colombian drug trafficking organization and to perform contract killings. During meetings in Asia, Africa, and the Caribbean, beginning in January 2013 and continuing through late September 2013, Hunter communicated with three confidential sources (the “CSs”) working with the DEA, who purported to be Colombian narcotics traffickers. Hunter agreed to serve as the head of security for the CSs’ purported narcotics trafficking organization, and assembled a “security team” consisting of VAMVAKIAS, GOGEL, Filter, and Soborski. Hunter also told the CSs that he had previously been involved in contract killings – referred to as “bonus jobs” – and that some team members wanted to do as much “bonus work” as possible.
VAMVAKIAS, GOGEL, and their co-defendants thereafter agreed, in meetings and communications with the CSs, to provide security and surveillance services to the narcotics trafficking organization. Furthermore, VAMVAKIS, GOGEL, and Hunter agreed to commit murder-for-hire in Liberia by assassinating both a Special Agent of the DEA and a person who, according to the CSs, was providing information to the DEA about the CSs’ narcotics trafficking organization. In exchange for the murders, VAMVAKIAS and GOGEL were together to be paid approximately $700,000, and Hunter was to receive an additional $100,000 for his leadership role. Communications between these defendants and the CSs occurred by telephone, via email, and in a series of surreptitiously audio-recorded and videotaped meetings over an approximately nine-month period.
In late March 2013, in Thailand, GOGEL and Filter surveilled a vessel on behalf of the CSs’ purported narcotics trafficking organization and reported their activities to Hunter. In April 2013, in Mauritius, at the direction of the CSs, GOGEL, Filter, and Soborski provided security for a meeting at which the participants discussed the distribution of illegal narcotics to the United States. In late June 2013, in the Bahamas, VAMVAKIAS, GOGEL, Filter, and Soborski conducted surveillance of a purported U.S.-registered aircraft at the direction of the third CS (“CS-3”), who posed as a member of the CSs’ narcotics trafficking organization. CS-3 informed the defendants that the aircraft was to be loaded with 300 kilograms of cocaine to be shipped to New York.
With respect to the murder-for-hire scheme, in mid-May 2013, at a meeting with the CSs in Thailand, VAMVAKIAS, GOGEL, Hunter and Soborski were told that a “bonus job” – that is, a contract killing – was in the offing, due to a leak within the CSs’ narcotics trafficking organization. In late May 2013, in email communications, Hunter confirmed that his team would be willing to murder both a U.S. law enforcement agent and a source (purportedly a boat captain) who was providing information to U.S. law enforcement authorities. Hunter confirmed by email that his team would kill both the DEA agent and the informant who was providing information to law enforcement about the CSs’ narcotics trafficking organization. VAMVAKIAS and GOGEL discussed the weapons that could be used and masks to be worn for the murders, and VAMVAKIAS stated that it would be better to “hit the agent first” and then “the snitch.” In early July 2013, Hunter sent via email a list of the items needed for the murders, including “[t]wo Submachine Guns with silencers . . . [t]wo .22 pistols with Silencers.”
In mid-August 2013, at a meeting in Thailand, Hunter told CS-3 that VAMVAKIAS and GOGEL would commit the murders. VAMVAKIS, GOGEL, and Hunter discussed in detail the weapons that would be used and the possibility of entering Liberia without having their passports stamped. They suggested that CS-3 fly them out of the country via private plane following the murders. VAMVAKIAS stated that among other weapons, a sub-machine gun and two .22 caliber pistols would be needed for the murders, and CS-3 agreed to deliver the weapons to Liberia. The next day, at a meeting with GOGEL, CS-3 confirmed that an order for the requested weapons had been made. Later that same day, GOGEL met again with CS-3 and provided CS-3 with two highly sophisticated latex facemasks, which can make the wearer appear to be of another race, for CS-3 to transport to Liberia.
In late September 2013, VAMVAKIAS and GOGEL arrived in Liberia to commit the planned murders-for-hire, where they were arrested. On the same day, Hunter was arrested in Thailand, and Soborski and Filter were arrested in Estonia.
VAMVAKIAS, 43, and GOGEL, 29, each pled guilty to one count of conspiring to import cocaine into the United States, one count of conspiring to murder a federal law enforcement agent and an individual assisting a federal law enforcement agent, one count of conspiring to possess machine guns and silencers during and in furtherance of the murders, and one count of conspiring to distribute cocaine on board an aircraft registered in the United States. As a result of their guilty pleas, VAMVAKIAS and GOGEL each face a mandatory term of 10 years in prison and a maximum possible term of life in prison. VAMVAKIAS is scheduled to be sentenced by Judge Swain on April 30, 2015. GOGEL is scheduled to be sentenced by Judge Swain on May 1, 2015.
The remaining defendants, Hunter, 49, Soborski, 41, and Filter, 30, are charged with conspiracy to import cocaine into the United States. Hunter is also charged with conspiracy to murder a law enforcement agent and a person assisting a law enforcement agent; conspiracy to kill a person to prevent communications to law enforcement agents; and conspiracy to possess a firearm in furtherance of a crime of violence. Each count carries a maximum penalty of life in prison. Trial is scheduled to commence before Judge Swain on March 9, 2015.
The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.
The charges against Hunter, Soborski, and Filter are merely accusations and they are presumed innocent unless and until proven guilty.
The guilty pleas were the result of the close cooperative efforts of the United States Attorney’s Office for the Southern District of New York; DEA’s Special Operations Division; DEA’s Bangkok, Ghana, Pretoria, Bucharest, Manila, Nassau and Copenhagen Offices; the Royal Thai Police Narcotics Suppression Bureau and Crime Suppression Division; the Royal Thai Immigration; the Royal Thai Attorney General’s Office; Republic of Liberia’s National Security Agency; the Republic of Liberia’s Attorney General’s Office; the Estonian Police and Border Guard; the Estonian National Criminal Police, Investigative Bureau; the Estonian State Prosecutors Office; the Royal Bahamas Police Force and Drug Enforcement Unit; the Romanian National Police; Interpol; and the U.S. Department of Justice Office of International Affairs.
This prosecution is being handled by the Office’s Terrorism and International Narcotics Unit. Assistant United States Attorneys Michael Lockard, Anna Skotko, Aimee Hector, and Emil Bove are in charge of the prosecution.
Malaysian Defense Contractor Leonard Francis Pleads Guilty to Corruption Conspiracy Involving “Scores” of Navy Officials; A Navy Captain – The Highest Ranking so Far - Admits He Was One of ThemRead the Press Release
SAN DIEGO - Leonard Glenn Francis, owner and chief executive of Glenn Defense Marine Asia, pleaded guilty to bribery and fraud charges in federal court today, admitting that he presided over a massive, decade-long conspiracy involving “scores” of U.S. Navy officials, tens of millions of dollars in fraud and millions of dollars in bribes and gifts – from cash, prostitutes and luxury travel to Cuban cigars, Kobe beef and Spanish suckling pigs.
Also today, U.S. Navy Capt. Daniel Dusek, 47, was charged via information and pleaded guilty to a single count of conspiracy to commit bribery before U.S. Magistrate Judge William V. Gallo. Dusek, the highest-ranking of five current or former Navy officials to plead guilty in the case so far, admitted that he used his influence as Deputy Director of Operations for the 7th Fleet, headquartered in Yokosuka, Japan, and later as executive officer of the USS Essex and the commanding officer of the USS Bonhomme Richard, to benefit Francis and GDMA, which for decades provided port services to U.S. Navy ships. Dusek admitted that in return, Francis plied him with meals, alcohol, entertainment, gifts, dozens of nights and incidentals at luxury hotels and the services of prostitutes.
Francis, a 50-year-old Malaysian national, and his corporate entity GDMA, both pleaded guilty to conspiracy to commit bribery, bribery and conspiracy to defraud the United States before U.S. Magistrate Judge Jan M. Adler. According to the plea agreement, Francis faces up to 25 years in prison.
Francis also admitted to defrauding the U.S. Navy of tens of millions of dollars by routinely overbilling for everything from fuel to tugboats to sewage disposal. The government and Francis have agreed that Francis and GDMA should forfeit $35 million of the ill-gotten proceeds and pay full restitution to the U.S. Navy, an amount to be determined by U.S. District Judge Janis L. Sammartino upon sentencing.
In his plea agreement, Francis conceded that over the course of the conspiracy, he and GDMA gave public officials millions of dollars in things of value, including over $500,000 in cash; hundreds of thousands of dollars in the services of prostitutes and associated expenses; hundreds of thousands of dollars in travel expenses, including airfare, often first or business class, luxurious hotel stays, incidentals and spa treatments; hundreds of thousands of dollars in lavish meals, top-shelf alcohol and wine and entertainment; and hundreds of thousands of dollars in luxury gifts, including designer handbags and leather goods, watches, fountain pens, fine wine, champagne, Scotch, designer furniture, consumer electronics, ornamental swords and hand-made ship models.
Francis identified seven Navy officials who accepted his bribes – including Dusek; Commanders Jose Luis Sanchez and Michael Vannak Khem Misiewicz; Naval Criminal Investigative Service Special Agent John Beliveau; Petty Officer First Class Dan Layug; and two unnamed, yet-to-be-charged individuals - a contract specialist and a lieutenant commander. All of the charged Navy officials have pleaded guilty except Misiewicz, whose case is pending. Misiewicz has pleaded not guilty.
“It is astounding that Leonard Francis was able to purchase the integrity of Navy officials by offering them meaningless material possessions and the satisfaction of selfish indulgences,” said U.S. Attorney Laura Duffy. “In sacrificing their honor, these officers helped Francis defraud their country out of tens of millions of dollars. Now they will be held to account.”
“Today’s guilty pleas of Leonard Francis, his company, and a Navy officer are vitally important steps in our active, ongoing investigation,” said Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division. “We will continue our efforts to root out those implicated in this long-running corruption scheme, both inside the Navy and out. The interests of justice and national security demand nothing less.”
“The greed of all those involved in this massive fraud and bribery case has cost American taxpayers tens of millions of dollars,” said Naval Criminal Investigative Service Director Andrew Traver. “NCIS and our law enforcement partners have pored through mountains of documents and emails, discovering and documenting the crimes so that those who participated can be held accountable. Although today's pleas are a significant milestone in the case, this investigation is far from over; there is much more work to be done.”
“The guilty pleas entered today send a clear message to those who, driven by greed, betray the faith and trust of the American taxpayers" said Deputy Inspector General for Investigations James B. Burch of the Department of Defense, Defense Criminal Investigative Service. “The DCIS, along with its law enforcement partners, will relentlessly pursue those who corrupt the procurement process for their own personal benefit.”
“I'm extremely gratified that the work of our investigative support team could make a significant contribution to the outcome in this egregious case of defrauding the government and, ultimately, the American taxpayer,” said Anita Bales, Director of Defense Contract Audit Agency.
According to Dusek’s plea agreement, he hand-delivered Navy ship schedules to the GDMA office in Japan or emailed them directly to Francis or a GDMA employee on dozens of occasions, each time taking steps to avoid detection by law enforcement or U.S. Navy personnel. Dusek was so helpful to GDMA that an employee identified him as “an official GDMA card holder.” And he was rewarded for his efforts. In one example cited in the plea agreement, GDMA paid for a hotel for Dusek and his family at the Marriott Waikiki in Hawaii on July 19, 2010. A few weeks later, on August 5, 2010, GDMA paid for a hotel room for Dusek at the Shangri-La in Makati, Philippines and while there, GDMA provided him with the services of a prostitute.
Soon after, Francis asked Dusek to exercise his influence on GDMA’s behalf by steering the aircraft carrier USS Abraham Lincoln and its associated strike group to Port Klang, Malaysia – a port terminal owned by Francis. Dusek replied in a series of emails to GDMA in late August 2010 that he would make it happen. “Good discussion with N00 (Admiral) today and convince him that PKCC (Francis’ terminal) is the better choice,” Dusek wrote to Francis on August 21, 2010. Three days later, Dusek reported to Francis that he had “everyone in agreement that the next CSG (Carrier Strike Group) through the AOR (area of responsibility) will stop at PKCC. Dates will be 08-12 Oct.”
The USS Abraham Lincoln Carrier Strike Group did, in fact, make that visit to Francis’ port on October 8-12, 2010.
In an email to one of his employees, Francis wrote on October 3, 2010: “(Dusek) is a golden asset to drive the big decks (aircraft carriers) into our fat revenue GDMA ports.”
On September 17, 2013, when Dusek learned that Francis and Navy personnel had been arrested, he deleted the contents of his email accounts in an effort to avoid detection by law enforcement.
In the Francis plea agreement, Francis admitted that he required his Navy contacts to use their influence to benefit GDMA by steering contracts to GDMA; by scheduling and directing Navy ships to various ports favored by GDMA; and by advocating for and advancing GDMA’s interests with the Navy with respect to ship husbanding issues.
Francis also said Misciewicz provided classified and proprietary Navy information on dozens of occasions and in return, he gave cash and paid travel expenses for Misciewicz. The plea agreement lists eight examples.
Francis acknowledged that he recruited NCIS Special Agent Beliveau, who was the first to plead guilty in this case, to conduct regular searches of the NCIS database which housed information about ongoing NCIS investigations; to download NCIS reports involving investigations into the activities of GDMA and Francis and provide copies of these reports to Francis; and to give Francis advice and counsel on how to respond to, stall and thwart these investigations.
As part of his plea, Francis admitted that Beliveau gave him the identities of subjects of these investigations; the information provided by witnesses and documents, including identifying information about cooperating witnesses and their testimony; the aspects of GDMA’s billings that were of concern to the investigations; the fact that the investigations had obtained email accounts, and the identity of those accounts; the particulars about bank records and financial information sought by the investigations; the reports to prosecutors; and outlines of planned future investigative activities.
Besides Francis, two other GDMA executives - Alex Wisidagama and Edmond Aruffo – have pleaded guilty, acknowledging their roles in defrauding the United States. That brings the total of guilty pleas to seven of eight defendants.
Francis and Dusek are scheduled to be sentenced on April 3, 2015 at 9 a.m by Judge Sammartino.
The ongoing investigation is being conducted by NCIS, DCIS and the Defense Contract Audit Agency. The case is being prosecuted by Assistant U.S. Attorneys Mark W. Pletcher and Robert S. Huie of the Southern District of California and Director of Procurement Fraud Catherine Votaw and Trial Attorney Brian R. Young of the Criminal Division’s Fraud Section.
Those with information relating to fraud, corruption or waste in government contracting should contact the NCIS anonymous tip line at www.ncis.navy.mil or the DOD Hotline at www.dodig.mil/hotline, or call (800) 424-9098.
DEFENDANT Case Number: 13-CR-3781, 3782 and 4287 Leonard Glenn Francis Age: 50 Singapore Glenn Defense Marine Asia Pte. Ltd. Singapore CHARGESConspiracy to Commit Bribery, in violation of 18 U.S.C. § 371. Maximum penalty five years in prison, $250,000 fine or twice the gross pecuniary gain or loss from the offense, whichever is greater;
Bribery, in violation of 18 U.S.C. § 201. Maximum 15 years in prison, $250,000 fine or twice the gross pecuniary gain or loss from the offense, whichever is greater. Mandatory restitution.
Conspiracy to Defraud the United States, in violation of in violation of 18 U.S.C. sec. 371. Maximum penalty five years in prison $250,000 fine or twice the gross pecuniary gain or loss from the offense, whichever is greater. Mandatory restitution.
DEFENDANT Case Number: 15-CR-131-JLS Daniel Dusek Age: 47 San Diego, CA CHARGESConspiracy to Commit Bribery, in violation of 18 U.S.C. § 371. Maximum penalty five years in prison, $250,000 fine or twice the gross pecuniary gain or loss from the offense, whichever is greater.
INVESTIGATING AGENCIESDefense Criminal Investigative Service
Naval Criminal Investigative Service
Defense Contract Audit Agency*An indictment or complaint itself is not evidence that the defendants committed the crimes charged. The defendants are presumed innocent until the Government meets its burden in court of proving guilt beyond a reasonable doubt.
Mississippi Army National Guard Captain Convicted of Defrauding the ArmyRead the Press Release
Hattiesburg, Miss - Jamie Jackson, 44, of Mendenhall, was convicted by a federal jury on Wednesday, January 14, 2015, of six counts of theft of government funds and six counts of wire fraud for carrying out a scheme to defraud the Army out of recruitment incentive payments, announced U.S. Attorney Gregory K. Davis.
The evidence presented at trial showed that in 2006 the National Guard Bureau instituted a recruiting program called the Guard Recruiter Assistance Program (GRAP) to incentivize current service members to tell their friends and family about the benefits of joining the National Guard. Soldiers who contacted potential recruits and connected them with a National Guard recruiter were eligible to receive up to $2,000 in incentive payments if their recruit joined the Guard and went to basic training.
Jackson, a Captain working at Camp Shelby, was not eligible to participate in GRAP because he was working full-time for the Guard. The evidence at trial showed that Jackson created a GRAP account in the name of his nephew, an enlisted Guardsman who was eligible for GRAP payments, and began entering the names of potential recruits into the GRAP system, as if his nephew was assisting them in their recruitment. The evidence showed that Jackson got the names and personal information of these potential recruits when he tutored them to help them pass the ASVAB military entrance exam. After the recruits passed the ASVAB and joined the Guard, the incentive payments were sent to a bank account Jackson controlled. Three of the recruits testified at trial that Jackson's nephew had not assisted in the recruiting. Two of the recruits had never met Jackson's nephew at all.
Jackson will be sentenced by U.S. District Judge Keith Starrett on April 9, 2015 at 1:30 p.m. He faces a maximum penalty of ten years in prison for one count of theft of government funds and up to one year in prison for each of the remaining five counts of theft of government funds. Additionally, he faces up to 20 years in prison for each of the six wire fraud counts, a fine of up to $250,000 per count, and a forfeiture judgment equal to the amount of money he illegally obtained. He will also be required to pay restitution to the Army.
The case was investigated by the Army Criminal Investigation Division, Defense Criminal Investigation Service and the United States Secret Service. It was prosecuted by Assistant U.S. Attorneys Scott Gilbert and Chris Wansley.
Lawrence County Sheriff’s Deputies Charged with Use of Unreasonable ForceRead the Press Release
CINCINNATI – A federal grand jury in Cincinnati has charged Jeremy S. Hanshaw, 36, of Coal Grove, Ronald S. Hatfield, 25, of Waterloo, and Jason D. Mays, 22, of South Point, with conspiring to deprive, and depriving, an arrestee of civil rights while acting under the color of law as deputies of the Lawrence County Sheriff’s Office.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, and John A. Barrios, Acting Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division, announced the indictment unsealed today.
The indictment alleges that on or about August 16 to August 17, 2014, while working as deputies at the Lawrence County Jail, Hanshaw and Hatfield slammed, kicked and punched a victim when that victim was handcuffed behind his back and was not resisting or posing a physical threat to any officer. The officers allegedly slammed the victim to the ground and restrained him in a chokehold while lying on top of the victim. The indictment further alleges that Hanshaw choked the victim and delivered an elbow strike to the victim’s head while the victim was restrained on a medical gurney. Then-deputy Mays allegedly struck the victim in the neck with a closed fist and attempted to block a surveillance camera while his fellow officers had the victim on the ground.
In addition, one or more of the defendants allegedly wrote false entries on logs and reports in which they created a false justification for the assault on the victim.
Conspiracy to deprive an individual of civil rights and deprivation of civil rights are crimes punishable by up to 10 years in prison.
The defendants were arrested on January 15, 2015 by FBI agents.
“Good policing practices are essential,” U.S. Attorney Stewart said. “Law enforcement strategies must be consistent with constitutional rights.”
“The protection of civil rights is one of the FBI’s highest criminal priorities,” stated Acting Special Agent in Charge John A. Barrios. “The FBI is committed to holding accountable those who believe they can abuse the powers they have been granted.”
U.S. Attorney Stewart commended the investigation of this case by the FBI and recognized the Lawrence County Sheriff’s Office and the Lawrence County Prosecutor’s Office for their assistance, as well as Assistant U.S. Attorneys Emily Glatfelter and Alexis Zouhary, who are prosecuting the case.
An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.
Lafayette Attorney Sentenced to 121 Months in Prison for Drug Conspiracy, Money LaunderingRead the Press Release
LAFAYETTE, La. – United States Attorney Stephanie A. Finley announced today that Lafayette attorney Daniel James Stanford, 57, was sentenced to 121 months in prison for conspiring to distribute synthetic drugs, conspiring to introduce misbranded drugs into interstate commerce, and money laundering.
Stanford, of Lafayette, was sentenced by U.S. District Judge Elizabeth E. Foote for one count of conspiracy to distribute or possess with intent to distribute a controlled substance analogue, one count of conspiracy to introduce or cause to be introduced misbranded drugs into interstate commerce, one count of conspiracy to launder money, and five counts of money laundering. He was also ordered to serve six years of supervised release. The other defendants were sentenced on December 16, 2014. (*For a graphic listing the sentences of the other defendants refer to the end of this document.)
After eight days in trial, more than six hours of deliberation and testimony from 30-plus witnesses, a federal jury found Stanford guilty on August 29, 2014. Stanford was found not guilty on five counts of the indictment, which related to additional money laundering charges.In September of 2012, Curious Goods LLC and co-conspirators Alexander Derrick Reece, 42 of Gainesville, Fla.; Drew T. Green, 40 of Roswell, Ga.; Thomas William Malone Jr., 48 of Roswell, Ga.; Boyd Anthony Barrow, 46 of Canton, Ga.; Joshua Espinoza, 51 of Marietta, Ga.; Richard Joseph Buswell, 46 of Lafayette, La.; Daniel Paul Francis, 44 of Dawsonville, Ga.; and Stanford were charged in a 16-count indictment with conspiracy to distribute synthetic drugs, conspiracy to introduce misbranded drugs into interstate commerce, conspiracy to commit money laundering, and various money laundering charges.
At the time of the indictment, Curious Goods LLC was a business based in Lafayette that marketed smoking and other products in stores throughout Acadiana. The stores sold a product called “Mr. Miyagi” that was infused with synthetic cannabinoids. Although mislabeled as a potpourri, “Mr. Miyagi” was sold to be smoked for the sole purpose of getting the consumer “high.” The synthetic cannabinoids infused into “Mr. Miyagi” are considered Schedule I controlled dangerous substances under federal law. From March 1, 2011 to December 31, 2011, Curious Goods stores made approximately $5 million from the sale of “Mr. Miyagi.”
Barrow and Espinoza controlled and operated Pinnacle Products LLC/Pinnacle Products Group, based in Marietta, Ga. Pinnacle was the manufacturer of the “Mr. Miyagi” products and supplied the products to the local Curious Goods stores. Pinnacle obtained the synthetic cannabinoids used to manufacture “Mr. Miyagi” from NutraGenomics, which was located in Alpharetta, Ga., and was controlled by co-conspirators Green and Malone. NutraGenomics distributed synthetic cannabinoids throughout the United States.
Stanford, who is a criminal defense attorney, represented himself at trial. During opening statements, Stanford told the jury he was “absolutely not guilty of any of this.” However, at trial, the evidence showed that Stanford was actively involved with the Curious Goods enterprise, that he was well aware that the company sold a product called “Mr. Miyagi,” and that “Mr. Miyagi” was a substance that was infused with synthetic cannabinoids.
Exhibits introduced at trial exposed that “Mr. Miyagi” was specifically labelled “not for human consumption” but was sold as a product that would be smoked by users to get high. The evidence also demonstrated that the product was packaged to be intentionally false and misleading, marketed as potpourri. The exterior package label of “Mr. Miyagi” stated that it was to be used to refresh scents in drawers, closets, and cars. Evidence introduced at trial clearly demonstrated that Stanford knew the product was being consumed by humans, that it was harmful and not a scent refresher, and that the product was marketed to youthful customers. The intentional mislabeling and misbranding, spearheaded by Stanford, were part of a legal strategy and subterfuge to feign compliance with the law, to avoid law enforcement detection, and to avoid civil and criminal liability.
Among the many witnesses testifying at trial were local law enforcement and DEA Task Force agents who testified that during the execution of search warrants on December 8, 2011, they searched all Curious Goods store locations, including the company’s warehouse in Lafayette, and seized approximately 190 pounds of synthetic drugs worth approximately $517,000.
“The sentencing of this last defendant brings an end to this case, but not to our commitment to prosecute those who sell these illegal and dangerous drugs in our community,” Finley stated. “This case highlights how lucrative this industry is and the lengths that criminals are willing to go to profit while endangering the health and safety of citizens. Too many members of our community visited these shops that sold this poison, especially the youth. Stanford’s insatiable desire for money drove him to join this conspiracy and put many, many people in harm’s way. Today, his greed and criminal activity have consequences. Stanford misused his position as an attorney to facilitate the sales of a dangerous drug and to launder money. I want to thank the men and women of the federal, state and local law enforcement for bringing these defendants to justice. They are to be commended for years of hard work to get these illegal substances off the street and hold these criminals accountable. I hope that store owners, franchisees, investors and distributors who want to make a fast buck at the expense of others, think twice and understand that we will not hesitate to investigate and prosecute their criminal activity.”
Buswell was sentenced to 103 months in prison, Green was sentenced 117 months in prison, Malone was sentenced to 117 months in prison, Barrow was sentenced to 70 months in prison, Espinoza was sentenced to 61 months in prison, and Francis was sentenced to 42 months in prison. Green and Malone were also ordered to pay a $20,000 fine. Curious Goods LLC was ordered to pay a $40,000 fine. The company was also ordered to forfeit $859,989 in illegal proceeds derived from the scheme, as well as two cars and a speed boat.
The DEA, FBI, IRS, HSI, Louisiana State Police, Lafayette Parish Sheriff’s Office, Iberia Parish Sheriff’s Office, Vermilion Parish Sheriff’s Office and the Lafayette Police Department conducted this investigation. Assistant U.S. Attorneys John Luke Walker, J. Collin Sims, and Robert C. Abendroth prosecuted the case.
*Defendants Prison Term Supervised Release Fine CountsDrew Green
117 months
3 years
$20,000
1
Tommy Malone
117 months
3 years
$20,000
1
Boyd Barrow
70 months
3 years
1
Joshua Espinoza
61 months
3 years
1
Daniel Francis
42 months
1 year
2
Richard Buswell
103 months
3 years
1
Curious Goods LLC
$40,000
1
Justice Department Settles with Ohio Healthcare System over HIV DiscriminationRead the Press Release
The Justice Department announced today that, as part of its Barrier-Free Health Care Initiative, the department has reached a settlement with Genesis Healthcare System (Genesis) to resolve claims that Genesis discriminated against a woman with HIV in violation of the Americans with Disabilities Act (ADA). Genesis operates a healthcare system that includes a hospital, a network of more than 300 physicians, and multiple outpatient health care centers throughout southeastern Ohio.
Title III of the ADA prohibits public accommodations, such as healthcare providers, from discriminating against people with disabilities, including HIV. Following an investigation, the department found that Genesis discriminated against a woman with HIV when one of its primary care physicians refused to accept her as a new patient because of her HIV. Genesis refused to accept her as a patient despite the fact that she was only seeking a general practitioner for medical care unrelated to HIV. As a result, the woman had to seek medical treatment at the local emergency room for non-emergent health issues. The department’s investigation revealed that it was this doctor’s practice to refer any patients with HIV seeking a primary care physician to an HIV specialist.
“Exclusion of patients with HIV creates unfair and illegal barriers to medical care for people with HIV,” said Acting Assistant Attorney General Vanita Gupta for the Civil Rights Division. “Under the law, healthcare providers cannot deny care or refer a patient to a specialist unless the decision is based on current medical knowledge about the particular patient and condition, not on stereotypes about a disability. The ADA prohibits these types of discriminatory barriers, and the Justice Department is committed to tearing them down.”
Under the settlement, Genesis Healthcare System must pay $25,000 to the victim of discrimination, and $9,000 as a civil penalty. In addition, it must train its staff on the ADA, develop and implement a non-discrimination policy, and report to the department every time a person with HIV (or who is suspected of having HIV) is denied or discharged as a patient, with a written justification for the decision.
This settlement agreement is part of the department’s Barrier-Free Health Care Initiative, a partnership of the Civil Rights Division and U.S. Attorney’s offices across the nation to target enforcement efforts on a critical area for individuals with disabilities: access to health care. For more information on the Barrier-Free Health Care Initiative visit http://www.ada.gov/usao-agreements.htm.
For more information on the ADA, HIV discrimination, and this settlement, visit www.ada.gov/aids. Those interested in finding out more about the obligations of healthcare providers under the ADA may call the Justice Department’s toll-free ADA information line at 800-514-0301 or 800-514-0383 (TDD), or access its ADA website at www.ada.gov. ADA complaints may be filed by email to [email protected].
Justice Department Settles Pay Discrimination Lawsuit Against Clark County, NevadaRead the Press Release
The Department of Justice announced today that it has entered into a consent decree with Clark County, Nevada, that, if approved by the United States District Court for the District of Nevada, will resolve the department’s lawsuit filed under Title VII of the Civil Rights Act of 1964 regarding compensation discrimination and retaliation. In its lawsuit, the department alleged that the county paid Therese Scupi, its Director of Diversity, significantly less than white and male county employees whose duties were substantially similar to hers. The complaint also alleged that the county subjected Scupi to retaliation when she complained of disparities in her pay that she believed were based on her race and sex.
Under the terms of the consent decree, the county has agreed to pay Scupi approximately $179,000 in back pay, compensatory damages, and pension contributions. In accordance with the decree, Clark County has also agreed to maintain employment policies, practices and procedures that comply with federal discrimination laws and to conduct training designed to prevent against and correct both discrimination in compensation and retaliation.
This lawsuit resulted from a joint project with the Equal Employment Opportunity Commission (EEOC) designed to ensure vigorous enforcement of Title VII against state and local governmental employers by enhancing cooperation between the EEOC and the Civil Rights Division.
“Title VII protects employees who have the courage to challenge discriminatory pay compensation practices without fear of retaliation from their employers,” said Acting Assistant Attorney General Vanita Gupta for the Civil Rights Division. “We are pleased to have been able to work cooperatively with the Equal Employment Opportunity Commission to achieve a broad range of injunctive and monetary relief in this important case.”
“Pay inequity remains as a hurdle for working women,” said District Director Rosa Viramontes of the EEOC’s Los Angeles District, which includes southern Nevada in its jurisdiction. “We were pleased that our partnership with the Department of Justice on this case yielded positive results and will lead to a more equitable working environment going forward.”
Scupi originally filed a charge of race and sex discrimination and retaliation with the EEOC, a federal agency that enforces laws against discrimination in employment. The EEOC’s Las Vegas local office investigated the matter, determined that there was reasonable cause to believe that discrimination and retaliation had occurred and referred the matter to the department.
The United States was represented by Civil Rights Division attorneys Antoinette Barksdale and Robert Galbreath.
Title VII prohibits discrimination in employment on the basis of gender, race, color, national origin or religion, and prohibits retaliation against an employee who opposes an unlawful employment practice, or because the employee has made a charge or participated in an investigation, proceeding or hearing under the act. The enforcement of Title VII and other federal employment discrimination laws is a top priority of the Justice Department’s Civil Rights Division. Additional information about the Civil Rights Division and its work is available on its website at www.justice.gov/crt.
The EEOC enforces federal laws prohibiting employment discrimination. Further information about the EEOC is available on its website at www.eeoc.gov.
Justice Department Settles Immigration-Related Discrimination Claim Against Janitorial CompanyRead the Press Release
The Justice Department announced today that it reached a settlement agreement with U.S. Service Industries (USSI), a janitorial company headquartered in Bethesda, Maryland, and operating in Florida, Maryland, Virginia and Washington, D.C. The agreement resolves allegations that USSI violated the Immigration and Nationality Act (INA) by discriminating against work-authorized individuals who are not U.S. citizens.
The Justice Department’s investigation found that USSI required workers who are not U.S. citizens to produce documents issued by the Department of Homeland Security as a condition of employment, but it did not make similar demands of U.S. citizens. The INA’s anti-discrimination provision prohibits employers from placing additional documentary burdens on workers during the employment eligibility verification process based on their citizenship status.
Under the settlement agreement, USSI will pay $132,000 in civil penalties to the United States; undergo training on the anti-discrimination provision of the INA; establish a $50,000 back pay fund to compensate any workers who may have lost wages; revise its employment eligibility verification policies; and be subject to monitoring of its employment eligibility verification practices for two years.
“Employers cannot create unlawful discriminatory obstacles for immigrants,” said Acting Assistant Attorney General Vanita Gupta for the Civil Rights Division. “It is important that large employers review their employment eligibility verification practices at all of their offices to make sure they are in compliance with the law.”
The Office of Special Counsel for Immigration-Related Unfair Employment Practices (OSC) within the Justice Department is responsible for enforcing the anti-discrimination provision of the INA. Among other things, the statute prohibits citizenship status and national origin discrimination in hiring, firing or recruitment or referral for a fee, unfair documentary practices, retaliation and intimidation.
For more information about protections against employment discrimination under immigration laws, call OSC’s worker hotline at 1-800-255-7688 (1-800-237-2515, TTY for hearing impaired), call OSC’s employer hotline at 1-800-255-8155 (1-800-237-2515, TTY for hearing impaired), sign up for a free webinar at www.justice.gov/crt/about/osc/webinars.php, email [email protected] or visit OSC’s website at www.justice.gov/crt/about/osc.
Applicants or employees who believe they were subjected to different documentary requirements based on their citizenship status, immigration status or national origin, or discrimination based on their citizenship status, immigration status or national origin in hiring, firing, or recruitment or referral for a fee should contact OSC’s worker hotline for assistance.
Justice Department Reaches Settlement Agreement with First United Bank over Allegations of Discrimination on the Basis of National OriginRead the Press Release
The Justice Department announced today that First United Bank, of Dimmitt, Texas, will maintain uniform pricing policies, conduct employee training and pay $140,000 as part of a settlement to resolve allegations that it engaged in a pattern or practice of discrimination on the basis of national origin.
The settlement, which is subject to court approval, was filed in conjunction with the Justice Department’s complaint in the U.S. District Court for the Northern District of Texas. The complaint alleges that First United Bank charged higher prices on unsecured consumer loans made to Hispanic borrowers in violation of the Equal Credit Opportunity Act (ECOA).
“The Civil Rights Division is committed to ensuring that lenders price all types of loans based on appropriate credit factors and not based on prohibited factors such as national origin,” said Acting Assistant Attorney General Vanita Gupta for the Justice Department’s Civil Rights Division. “We commend First United Bank for implementing a system of loan pricing that provides objective guidance to the bank’s employees.”
The lawsuit originated from a referral by the Federal Deposit Insurance Corporation (FDIC) to the Civil Rights Division. First United Bank is a member of the FDIC.
Under the settlement, First United Bank will pay a total of $140,000 to compensate hundreds of victims of discrimination, monitor its loans for potential disparities based on national origin and provide equal credit opportunity training to its employees. First United Bank will also maintain its revised pricing policies to ensure that the price charged for its loans is set in a non-discriminatory manner consistent with the requirements of ECOA. The agreement also prohibits the bank from discriminating on the basis of national origin in any aspect of a credit transaction.
“This district is committed to ensuring banks and other lending institutions do not discriminate against borrowers on the basis of national origin,” said Acting U.S. Attorney John Parker for the Northern District of Texas. “I join the Acting Assistant Attorney General in recognizing First United Bank’s cooperation in accomplishing this settlement that will compensate hundreds of victims of this discrimination.”
The Justice Department’s enforcement of fair lending laws is conducted by the Fair Lending Unit of the Housing and Civil Enforcement Section in the Civil Rights Division. Since the Fair Lending Unit was established in February 2010, it has filed or resolved 36 lending matters under the Fair Housing Act, ECOA and the Servicemembers Civil Relief Act. The settlements in these matters provide for over $1.2 billion in monetary relief for impacted communities and individual borrowers. The Attorney General’s annual reports to Congress subject to ECOA highlight the department’s accomplishments in fair lending and are available at www.justice.gov/crt/publication.
The Civil Rights Division and the FDIC are members of the Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes. For more information on the task force, visit www.StopFraud.gov .
A copy of the complaint and proposed order, as well as additional information about fair lending enforcement by the Justice Department, can be obtained from the Justice Department website at www.justice.gov/fairhousing.
Justice Department Reaches Settlement Agreement with First United Bank over Allegations of Discrimination on the Basis of National OriginRead the Press Release
WASHINGTON – The Justice Department announced today that First United Bank, of Dimmitt, Texas, will maintain uniform pricing policies, conduct employee training and pay $140,000 as part of a settlement to resolve allegations that it engaged in a pattern or practice of discrimination on the basis of national origin.
The settlement, which is subject to court approval, was filed in conjunction with the Justice Department’s complaint in the U.S. District Court for the Northern District of Texas. The complaint alleges that First United Bank charged higher prices on unsecured consumer loans made to Hispanic borrowers in violation of the Equal Credit Opportunity Act (ECOA).
“The Civil Rights Division is committed to ensuring that lenders price all types of loans based on appropriate credit factors and not based on prohibited factors such as national origin,” said Acting Assistant Attorney General Vanita Gupta for the Justice Department’s Civil Rights Division. “We commend First United Bank for implementing a system of loan pricing that provides objective guidance to the bank’s employees.”
The lawsuit originated from a referral by the Federal Deposit Insurance Corporation (FDIC) to the Civil Rights Division. First United Bank is a member of the FDIC.
Under the settlement, First United Bank will pay a total of $140,000 to compensate hundreds of victims of discrimination, monitor its loans for potential disparities based on national origin and provide equal credit opportunity training to its employees. First United Bank will also maintain its revised pricing policies to ensure that the price charged for its loans is set in a non-discriminatory manner consistent with the requirements of ECOA. The agreement also prohibits the bank from discriminating on the basis of national origin in any aspect of a credit transaction.
“This district is committed to ensuring banks and other lending institutions do not discriminate against borrowers on the basis of national origin,” said Acting U.S. Attorney John Parker for the Northern District of Texas. “I join the Acting Assistant Attorney General in recognizing First United Bank’s cooperation in accomplishing this settlement that will compensate hundreds of victims of this discrimination.”
The Justice Department’s enforcement of fair lending laws is conducted by the Fair Lending Unit of the Housing and Civil Enforcement Section in the Civil Rights Division. Since the Fair Lending Unit was established in February 2010, it has filed or resolved 36 lending matters under the Fair Housing Act, ECOA and the Servicemembers Civil Relief Act. The settlements in these matters provide for over $1.2 billion in monetary relief for impacted communities and individual borrowers. The Attorney General’s annual reports to Congress subject to ECOA highlight the department’s accomplishments in fair lending and are available at www.justice.gov/crt/publication.
The Civil Rights Division and the FDIC are members of the Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes. For more information on the task force, visit www.StopFraud.gov .
A copy of the complaint and proposed order, as well as additional information about fair lending enforcement by the Justice Department, can be obtained from the Justice Department website at www.justice.gov/fairhousing.