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Wednesday 19 November 2014
Indictment: Postal Employee Stole Rx Drugs from MailRead the Press Release
TOPEKA, KAN. – A Topeka postal employee was indicted Wednesday on a federal charge of stealing prescription medications from the mail, U.S. Attorney Barry Grissom said.
Terry D. Ricley, 44, Burlingame, Kan., who worked sorting mail at the Topeka Post Office North Station, was charged with one count of theft by a postal employee. The indictment alleged he stole Hydrocodone and Tramadol being delivered by mail.
If convicted, he faces a maximum penalty of five years in federal prison and a fine up to $250,000. The U.S. Postal Service - OIG investigated. Assistant U.S. Attorney Christine Kenney is prosecuting.
OTHER INDICTMENTS
Daeshawn Lavar Bryant, 19, who is in custody in the Riley County Jail, is charged with one count of being an accessory after the fact to a robbery of a commercial business. The indictment alleges that on April 16, 2014, he provided assistance to a person who committed a robbery.
In September, Christopher James Wilhoite pleaded guilty to two counts of commercial robbery and one count of unlawful possession of a firearm in furtherance of a robbery. It is alleged Bryant aided and abetted Wilhoite in connection with an April 16, 2014, robbery at the Dollar General store at 2321 Tuttle Creek Boulevard in Manhattan, Kan.
If convicted, Bryant faces a maximum penalty of 20 years in federal prison and a fine up to $250,000. The Riley County Police Department, the Topeka Police Department and the FBI investigated. Assistant U.S. Attorney Jared Maag is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.Imperial Sand Dunes Storage Firm and Owner Plead Guilty to Illegal Disposal of Untreated Human Waste and SewageRead the Press Release
SAN DIEGO - Glamis Dunes Storage Inc. and its owner, Michael Mamelli, Sr., pleaded guilty today to the illegal underground disposal of potentially millions of gallons of untreated human waste and sewage at the Glamis Dunes Storage site for more than four years, in violation of the Safe Drinking Water Act. The Glamis Dunes site is located off of Highway 78 in Imperial County, and advertises storage services near the Imperial Sand Dunes Recreation Area.
The defendants admitted at today’s hearing that in August of 2007, Glamis Dunes Storage obtained a conditional use permit from Imperial County to install and operate a 20,000 gallon holding tank for RV waste (including human waste and grey water) at the facility. When acquiring the permit, Glamis Dunes Storage represented that the wastewater would be pumped out by a licensed septage hauler and disposed of at the Holtville wastewater treatment plant. According to Glamis Dunes Storage, the holding tank could be expected to dispose of approximately 1,250,000 gallons of RV sewage and grey water per year. The permit specifically prohibited any underground leach system attached to the holding tank.
As the defendants admitted, however, between February 16, 2010, and March 12, 2010, the defendants arranged for a contractor to build a leach field in the rear of the property, install a pump in the RV holding tank, and connect a pipe directly from the RV holding tank out to the leach field. The defendants also arranged for the power connection for the pump to be concealed under gravel near the RV holding tank. Thereafter, they admitted that they repeatedly disposed of the human waste and sewage from the RV holding tank by activating the pump and discharging the sewage through the underground leach field.
The defendants acknowledged that between August and October of 2012, they had a contractor add a new pump and two 2,500 gallon tanks in series to the pipe connecting the RV holding tank to the leach field. The defendants continued to illegally dispose of the sewage in the RV holding tank by discharging it through the underground tanks and leach field without a permit or other authorization from the EPA.
The defendants agreed to forfeiture of the sum of $50,000, as the proceeds of the offense, and to make restitution to the Bureau of Land Management and the Imperial County Department of Environmental Health and to fund the restoration of the site to the satisfaction of the Imperial County Department of Environmental Health.
Michael Mamelli and Glamis Dunes Storage, Inc. are scheduled to appear before U.S. District Court Judge William Q. Hayes on February 17, 2015, at 9:00 a.m. for sentencing.
DEFENDANTS Case Number: 14-CR-1766-WQH Glamis Dunes Storgage, Inc. Inc., 2006 Glamis, California Michael J. Mamelli, Sr. Age: 63 Newport Beach, California CHARGESUnlawful Injection of Pollutants, a felony, in violation of Title 42, United States Code, Section 300h-2(b)(2)
Maximum Penalty for Individual: Three years in prison; up to $250,000 fine or twice the illegal gain or loss, whichever is greater.
Maximum Penalty for corporation: Fine of up to $500,000.
INVESTIGATING AGENCYEnvironmental Protection Agency, Criminal Investigations Division
Bureau of Land ManagementHunters in Kansas Plead Guilty to Violating Migratory Bird ActRead the Press Release
WICHITA, KAN. – Seven hunters in Kansas pleaded guilty and were sentenced Wednesday for violating the Migratory Bird Treaty Act, U.S. Attorney Barry Grissom said.
The men admitted they violated the federal law protecting migratory birds when they participated in an annual opening weekend dove hunt in Graham County, Kan., on Sept. 1-2, 2013.
The Migratory Bird Treaty Act classifies mourning doves as migratory game birds. It classifies owls as migratory non-game birds. Restrictions on hunting mourning doves include a daily bag limit of 15 and a possession limit of three times the daily bag limit.
PLEAS
Defendants pleading and sentenced were:
Daniel R. Dinkel, 63, Hill City, Kan., one count of exceeding the daily bag limit for mourning doves.
Kent A. Webber, 52, Derby, Kan., one count of exceeding the daily bag limit for mourning doves, and one count of taking an owl.
Evan Webber, 25, Derby, Kan., one count of exceeding the daily bag limit for mourning doves, and one count of taking an owl.
Kenneth R. Beran, 67, Derby, Kan., one count of exceeding the daily bag limit for mourning doves.
Clark Law, 57, Hill City, Kan., one count of exceeding the daily bag limit for mourning doves.
Tracy D. Higgins, 54, El Dorado, Kan., one count of exceeding the daily bag limit for mourning doves, and one count of taking an owl.
John Kobler, 62, Topeka, Kan., one count of exceeding the daily bag limit for mourning doves.Another defendant, George Morgan, 52, Gordonville, Texas, who is charged with one count of exceeding the daily bag limit for mourning doves, is set for a change of plea hearing Nov. 24.
SENTENCES
Dinkel, Kobler, Law and Beran were sentenced to a year on probation in which they are not allowed to hunt, fish or trap, a $2,000 fine, and $3,000 restitution to the state of Kansas.
Kent Weber, Evan Weber and Higgins were sentenced to two years on probation in which they are not allowed to hunt, fish or trap, a $2,000 fine and $5,000 restitution.
Grissom commended the U.S. Fish and Wildlife Service investigated. Assistant U.S. Attorney Matt Treaster is prosecuting.
- Humble Woman Indicted in Second Fraud Scheme
Houma Man is Convicted of Drug Distribution ChargeRead the Press Release
U.S. Attorney Kenneth A. Polite announced that today a federal jury convicted, DONALD RICHARDSON, age 36, of Houma, Louisiana, of distribution of a quantity of cocaine base (“crack”).
RICHARDSON was charged in a two-count indictment, alleging that on March 17, 2011, and March 23, 2011, RICHARDSON distributed a quantity of crack. After a two-day trial before U.S. District Judge Sarah S. Vance, a jury returned a guilty verdict against RICHARDSON for the March 23, 2011 distribution charge.
RICHARDSON faces a maximum term of imprisonment of twenty years, a maximum fine of $1,000,000, three years of supervised release after imprisonment, and a $100 special assessment. Judge Vance set sentencing for March 4, 2015.
U.S. Attorney Polite praised the work of the Drug Enforcement Administration and the Terrebonne Parish Department’s Narcotics Unit in investigating this matter. Assistant United States Attorney Andre’ Jones and Special Assistant United States Attorney Brian C. Ebarb were in charge of the prosecution.
Hospice Company Owner Found Guilty of Committing Medicare Fraud, Conspiracy, Obstruction of Federal Audit, and Making False StatementsRead the Press Release
Oklahoma City, Oklahoma – A federal jury in Oklahoma City found PAULA KLUDING, 39, from Chandler, Oklahoma, the owner of Prairie View Hospice, Inc., an Oklahoma corporation located in Chandler, guilty on 39 separate counts relating to Medicare fraud, conspiracy, obstruction of a federal audit, and making false statements in health care matter, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
PATRICIA CARTER, 43, from Tecumseh, Oklahoma, was the general manager of Prairie View Hospice and was indicted along with Kluding in this case. Carter pled guilty on November 3, 2014, to one count of obstruction of a federal audit and testified at the trial.
According to evidence presented at trial, Prairie View Hospice was in business to provide hospice care to Medicare beneficiaries. Hospice care consists of providing health care, medication, medical equipment, and other goods and services to terminally ill patients. From July of 2010 through July of 2013, Kluding conspired with others to conceal the true medical condition of Prairie View Hospice’s patients and the true quality and quantity of health care services they were receiving in order to “pass” a Medicare audit and to fraudulently obtain money from Medicare. Specifically, certain medical documents were falsified to make it appear that nurses had visited patients or conducted necessary assessments when such visits and assessments had not, in fact, been made. Nursing notes were also falsified to make it appear that patients were in worse health than they actually were in order to justify to Medicare the patient’s continued hospice care. In addition, Prairie View Hospice, acting through Kluding, sent the falsified documents to a Medicare subcontractor in response to requests to audit patient files and in support of claims for Medicare reimbursement.
The trial lasted for four and half days and the jury deliberated about six hours before returning a guilty verdict on all counts.
At sentencing, Kluding faces up to 5 years imprisonment and a fine of $250,000 on each count, as well as paying restitution to the government. Carter faces 5 years imprisonment and a fine of $250,000. The government also seeks forfeiture of all proceeds obtained by Kluding from the criminal acts. Sentencing will take place in approximately 90 days.
This case is the result of an investigation by the U.S. Department of Health and Human Services Office of Inspector General and the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorneys Amanda Maxfield Green and Jessica Perry.
Hong Kong Man Pleads Guilty to Conspiracy to Smuggle Turtles out of the United States and to Violation of the Lacey ActRead the Press Release
U.S. Attorney Kenneth A. Polite announced that HON KIT LAU, age 34, from Hong Kong, pled guilty today to a one-count superseding Bill of Information charging him with conspiring to smuggle turtles out of the United States and to violate the Lacey Act.
According to the superseding Bill of Information, LAU was part of a group of individuals involved in capturing the threatened species of North American Wood turtles from the wild, shipping the turtles by mail though the United States, and then illegally exporting the turtles to Hong Kong.
U.S. District Court Judge Helen G. Berrigan scheduled sentencing for February 25, 2015. LAU faces a maximum term of five years in prison, a fine of $250,000, and three years of supervised release following any term of imprisonment.
U.S. Attorney Polite praised the work of the U.S. Fish and Wildlife Service, Homeland Security Investigations, and the United States Postal Inspection Service in investigating this matter. Assistant United States Attorney David Haller is in charge of the prosecution.
Honduran National Pleads Guilty to Illegal Re-Entry of a Removed AlienRead the Press Release
U.S. Attorney Kenneth A. Polite announced that MELVIN JOSUE AVELAR-CASTRO (“AVELAR”), age 34, a citizen of Honduras, pled guilty today to one-count of illegal re-entry of a removed alien.
According to court documents, AVELAR was arrested by Immigration and Customs Enforcement (“ICE”) agents at a residence in Metairie, Louisiana. The arrest followed an investigation by ICE agents which determined that AVELAR was illegally present in the United States. AVELAR had been convicted of re-entry of a removed alien on two previous occasions.
AVELAR faces a maximum term of imprisonment of ten years on the illegal re-entry charge, a fine of $250,000 and up to three years of supervised release following any term of imprisonment. U.S. District Judge Martin L.C. Feldman scheduled sentencing on March 18, 2015.
U.S. Attorney Polite praised the work of U.S. Immigration and Customs Enforcement in investigating this matter. Assistant U.S. Attorney Michael M. Simpson is in charge of the prosecution.
Honduran Man Sentenced for Violating the Federal Gun Control ActRead the Press Release
U.S. Attorney Kenneth A. Polite announced that SANTOS GAVARRETE-NATAREN, 36, a native of Honduras, pled guilty today to knowingly delivering a firearm to a common carrier without written notice.
According to court documents, on or about December 2, 2013, Dip Shipping, a common carrier based in Kenner, Louisiana, received a plastic container for international shipment at its West Bank drop-off location. The container was purportedly from Alfredo Barahona, addressed to Yessenia Martinez in Yoro, Honduras. The shipping label noted that the shipment contained kitchen items and shoes.
While scanning packages with a company owned X-ray machine, a Dip Shipping employee observed the image of two firearms inside the container. On December 9, 2013, HSI Special Agents were notified of the discovery and responded to Dip Shipping. Upon inspecting the container, the agents discovered that it contained a Smith & Wesson model 642, .38 revolver (SN: CJJ4544) and a Lorcin model L380, .380 semi-automatic handgun (SN: 125407).
HSI agents determined that GAVARRETE shipped the package. GAVARRETE admitted that he did not apply for an export license to ship the firearms. Further, he did not advise Dip Shipping that the package contained firearms.
U.S. District Judge Kurt D. Engelhardt scheduled sentencing for February 4, 2015. GAVARRETTE faces a maximum of 5 years imprisonment and a maximum fine of $250,000.
U.S. Attorney Polite praised the work of the Homeland Security Agents investigating this matter. Assistant United States Attorney Emily K. Greenfield is in charge of prosecuting this case.
Honduran Man Pleads Guilty to Immigration OffenseRead the Press Release
U.S. Attorney A. Kenneth Polite announced that ELVIS CANO-MORALES, age 33, a citizen of Honduras, pled guilty today to a one-count indictment for illegal reentry of a removed alien.
According to court documents, CANO-MORALES was found in the United States on August 1, 2014, after having been previously removed from the United States on June 10, 2011.
CANO-MORALES faces a maximum term of imprisonment of two years, as well as a fine of $250,000. U.S. District Judge Stanwood R. Duval set sentencing for January 28, 2015.
U.S. Attorney Polite praised the work of the U.S. Customs and Border Patrol in investigating this matter. Assistant United States Attorney Jon Maestri is in charge of the prosecution.
Homer Man Sentenced to 38 Months in Prison for Stealing more than $59,000 from EmployerRead the Press Release
SHREVEPORT, La. –United States Attorney Stephanie A. Finley announced today that a Homer man was sentenced to 38 months in prison for stealing more than $59,000 from his Claiborne Parish employer’s bank account.
John Bob Jr., 47, of Homer, La., was sentenced by U.S. District Judge Elizabeth E. Foote for one count of bank fraud and one count of aggravated identity theft. He was also sentenced to five years of supervised release and ordered to pay $58,248 restitution. According to the evidence presented at the July 15, 2014 guilty plea, the defendant used his employer’s debit card and personal identification number to make approximately 200 withdrawals totaling $59,602 from May 2012 to July 2013 from banks across northwest Louisiana.
The FBI and Claiborne Parish Sheriff’s Office conducted the investigation. Assistant U.S. Attorney Seth D. Reeg prosecuted the case.Happy's Pizza Founder Convicted of Multi-Million Dollar Tax Fraud SchemeRead the Press Release
On November 19, in the U.S. District Court for the Eastern District of Michigan, a federal jury after deliberating 4.5 hours convicted the president and founder of Happy’s Pizza of conspiracy to defraud the United States and 32 counts of tax crimes, the Justice Department announced today.
Happy Asker’s convictions include three counts of filing false federal individual tax returns for the years 2006 through 2008, 28 counts of aiding and assisting the filing of false federal income and payroll tax returns for several Happy’s Pizza Franchises restaurants for the years 2006 through 2009, and one count of engaging in a corrupt endeavor to obstruct and impede the administration of the Internal Revenue Code.
During trial, the evidence established that Asker was the president, founder and public face of the Farmington Hills, Michigan, based Happy’s Pizza franchise. He also had ownership interests in several Happy’s Pizza franchises located in Michigan, Ohio and Chicago. From June 2004 through April 2011, Asker, along with certain franchise owners and employees, executed a systematic and pervasive tax fraud scheme to defraud the Internal Revenue Service (IRS). Gross sales and payroll amounts were substantially underreported to the IRS on numerous individual corporate income tax returns and payroll tax returns submitted for nearly all 60 Happy’s Pizza franchise restaurants located in Michigan, Ohio and Illinois. Evidence admitted at trial established that from 2008 to 2010, more than $6.1 million in cash gross receipts were diverted from approximately 35 different Happy’s Pizza stores in the Detroit area, Illinois and Ohio. In total, the evidence at trial established that Asker and certain employees and franchise owners failed to report to the IRS approximately $3.84 million of gross income from the various Happy’s Pizza franchises and approximately $2.39 million in payroll. The evidence at trial further established that a portion of this unreported income was shared among most of the franchise owners, including Asker, in a weekly cash “profit split.” The cash was distributed among the investors and managers of the relevant franchises. The IRS is owed more than $6.2 million in taxes as a result of this fraud scheme.
The evidence at the two-week trial also established that Asker purposely misled IRS-Criminal Investigation special agents during voluntary interviews conducted on Nov. 5, 2010, and Dec. 1, 2010. Asker denied knowing co-defendant Arkan Summa, a convicted felon, and did not disclose Summa’s association with a number of Happy’s Pizza franchise restaurants. Documents admitted during trial indicate Summa shared in diverted gross receipts from at least one Happy’s Pizza franchise in Toledo, Ohio.
Four other defendants in the case pleaded guilty prior to Asker’s trial. On October 23, Maher Bashi, who served as Happy’s Pizza’s corporate chief operating officer, and Tom Yaldo, an owner of numerous Happy’s Pizza franchises, pleaded guilty to conspiracy to defraud the United States. According to the indictment, their conduct included, among other things, creating and maintaining fraudulent accounting records and falsely reporting income taxes and payroll taxes. On July 15, Summa pleaded guilty to engaging in a corrupt endeavor to obstruct and impede the due administration of the IRS, and Tagrid Summa, who is identified as a Happy’s Pizza franchise owner in documents admitted during trial, pleaded guilty to providing false documents to the IRS.
At sentencing, Happy Asker faces a statutory maximum sentence of five years in prison and a $250,000 fine for conspiracy to defraud the government. The charges of filing a false income tax return and aiding or assisting in filing a false return carry a statutory maximum sentence of three years in prison and a fine of $250,000 for each count. The obstruction charge carries a statutory maximum sentence of three years in prison and a fine of $250,000. Asker’s sentencing is scheduled for March 5, 2015, in the Eastern District of Michigan.
The case was investigated by special agents from IRS-Criminal Investigation and the Drug Enforcement Agency. Senior Litigation Counsel Corey Smith and Trial Attorney Mark McDonald for the Justice Department’s Tax Division prosecuted the case.
Hamden Woman Admits Stealing Deceased Mother’s Social Security Benefits for Nearly 30 YearsRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that SANDRA KIMBRO, 66, of Hamden, waived her right to indictment and pleaded guilty today in Hartford federal court to one count of theft of public funds.
According to court documents and statements made in court, KIMBRO’s mother, a Social Security benefits recipient, died in 1984. At the time of her death, KIMBRO and her mother had a jointly-held bank account into which the mother’s monthly Social Security benefits were deposited. Between April 1984 and February 2014, KIMBRO illegally obtained $160,457 in Social Security benefits that had been deposited into the account for her mother’s use. Through the years, as she withdrew money from the bank account, KIMBRO described to bank employees how she was providing care to her mother.
KIMBRO is scheduled to be sentenced by U.S. District Judge Robert N. Chatigny in Hartford on February 11, 2015, at which time she faces a maximum term of imprisonment of 10 years, a fine of up to $250,000 and an order of restitution.
This matter is being investigated by the Social Security Administration, Office of Inspector General – Office of Investigations, and is being prosecuted by Assistant U.S. Attorney Ray Miller.
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[email protected]Grand Jury Indicts Man Who Possessed Gun During Apartment Break-InRead the Press Release
PITTSBURGH – A former resident of Lawrence County and current resident of McKees Rocks, Pa., has been indicted by a federal grand jury in Pittsburgh on a charge of violating federal firearms laws, United States Attorney David J. Hickton announced today.
The one-count indictment, returned on Nov. 18, named Antron Jamal Talley, a/k/a Marvin Talley, 37, as the sole defendant.
According to the indictment, Talley possessed a firearm and/or ammunition on or about August 28, 2013, after having been convicted at eight different case numbers of crimes punishable by more than two years in prison. Those convictions include two separate prior firearm charges and seven different Aggravated Assault counts. Previously filed Court documents indicate that Talley was caught inside an apartment by police after a civilian observed him breaking in the door. Police located two loaded guns during the incident.
The law provides for a maximum total sentence of not less than 15 years and up to life in prison, a fine of $250,000, or both. Defendants who have three prior convictions for violent felonies or serious drug offenses face a minimum of 15 years and a maximum of life in prison, under the federal Armed Career Criminal Act. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history of the defendant.
Assistant United States Attorney Ross E. Lenhardt is prosecuting this case on behalf of the government.
The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Pittsburgh Bureau of Police conducted the investigation leading to the indictment in this case. This case is being prosecuted under Project Safe Neighborhoods, a collaborative effort by federal, state and local law enforcement agencies, prosecutors and communities to prevent, deter and prosecute gun crime.
An indictment is merely an accusation. A defendant is presumed innocent unless and until proven guilty.
Georgia Woman Sentenced for Selling PainkillersRead the Press Release
1125 Chapline Street, Federal Building, Suite 3000 ● Wheeling, WV 26003
(304) 234-0100 ● Contact: Tara Tighe, Public Affairs SpecialistELKINS, WEST VIRGINIA – Dorothy Ellen Metz, 62, of Athens, Georgia, was sentenced to twelve months and one day in prison for selling prescription painkillers, United States Attorney William J. Ihlenfeld, II, announced today.
Metz pled guilty in August 2014 to one count of “Possession with Intent to Distribute Oxycodone.” An investigation by the United States Forest Service revealed that Metz traveled from Georgia to Randolph County, West Virginia to sell oxycodone pills.
In other matters:
Jeremy Edward White, 34, of Elkins, West Virginia, was sentenced to seven months in prison for his role in selling prescription painkillers. He pled guilty in September 2014 to one count of “Distribution of Clonazepam” following an investigation by the United States Forest Service.
Beth Harman Ours, 46, of Petersburg, West Virginia, was sentenced to five years of probation. An investigation by the Potomac Highlands Drug and Violent Crime Task Force revealed her role in selling valium pills. She pled guilty in August 2014 to one count of “Distribution of Diazepam.”
Elizabeth Allison Sweatt, 39, of Nice, California, was sentenced to five years of probation. She was also ordered to forfeit $15,402.98 and to pay a money judgment in the amount of $60,000.00. She pled guilty in May 2014 to one count of “Possession with Intent to Distribute Marijuana – Aiding and Abetting.” An investigation by the United States Postal Inspection Service revealed that she was mailing packages containing marijuana from California to an associate in West Virginia for redistribution.
Jordan Elliot Ross, 24, was sentenced to three years of probation. Ross pled guilty in August 2014 to one count of “Distribution of Hydrocodone” following a West Virginia State Police investigation.
Chad Preston, 34, of Coalton, West Virginia, was sentenced to three years of probation. He pled guilty in March 2014 to one count of “Possession with Intent to Distribute Oxycodone” following an investigation by the Mountain Region Drug and Violent Crime Task Force.
Assistant U.S. Attorney Shawn Morgan prosecuted Preston and Assistant U.S. Attorney Steve Warner prosecuted the remaining cases on behalf of the government.
Chief U.S. District Judge John Preston Bailey presided.
Garland Man Pleads Guilty to Child Pornography OffenseRead the Press Release
DALLAS — A Garland, Texas, man, Jonathan Ramirez, 26, appeared yesterday before U.S. Magistrate Judge Renée Harris Toliver and pleaded guilty to one count of receipt of child pornography, announced U.S. Attorney Sarah R. Saldana.
Ramirez, who is in the U.S. illegally, faces a statutory penalty of not less than five years nor more than 20 years in federal prison, up to a $250,000 fine and up to a lifetime of supervised release. Sentencing is set for March 4, 2015, before U.S. District Judge Ed Kinkeade.
According to documents filed in the case, in June 2014, a Task Force Officer with the FBI, working online in an undercover capacity investigating the distribution of child pornography and the sexual exploitation of children, learned that a specific IP address, later linked to Ramirez, had made 78 files of child pornography available for sharing. Based in part on that discovery, the following month, law enforcement with the FBI Dallas Child Exploitation Task Force and the Garland Police Department executed a federal search warrant at Ramirez’s home. Agents seized an external hard drive and other media belonging to Ramirez. A review of the evidence revealed that the hard drive contained several child pornography videos.
Ramirez admitting using ARES P2P file sharing network to view and download images and videos of child pornography that he would then move to an external hard drive. He admitted that he had more than 175 videos and 50 images of child pornography on his computer and external hard drive.
The matter was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
The FBI’s Dallas Child Exploitation Task Force and the Garland Police Department investigated. Assistant U.S. Attorney Camille Sparks is in charge of the prosecution.
Founder of Deca Financial Service in Fishers Charged in Five Million Dollar FraudRead the Press Release
INDIANAPOLIS - Josh J. Minkler, Acting United States Attorney announced today the arrest of an Indianapolis man for bank fraud, wire fraud and bankruptcy fraud in a scheme involving the theft of over $5 million dollars. Todd J. Wolfe, 52, was arrested at his home this morning.
“Defrauding a financial institution affects all honest, hardworking individuals,” said Minkler. “Anyone who uses their position to abuse the public’s trust will be held strictly accountable.”
Since 2009, Wolfe operated DECA Financial services in Fishers, Indiana. DECA was a full service credit collections company which at one time employed nearly 75 individuals and whose principal activity was to collect delinquent loans for health care, student loans and financial services.
On two occasions, Wolfe allegedly filed false financial reports to BMO Harris bank inflating the assets of his company. The false reports allowed Wolfe to obtain lines of credit which he in turn used for personal expenses. Over a two and one half year period, the credit extended to Wolfe increased from $1 million to $7.5 million. Affidavits show he used some of the money to make payments on his personal residence, an automobile, personal credit card accounts and a lake house.
In June, 2013 Wolfe agreed to sell an individual $1 million in DECA stock which represented 5% ownership in the company. The victim was never repaid anything for his stock purchase. Wolfe allegedly used some of the $1 million to purchase a 2011 Audi 5S automobile. In February of this year, creditors forced Wolfe into bankruptcy. An attorney representing Wolfe and DECA filed a motion with the court stating Wolfe had a living trust worth over $14 million which could be used to repay creditors. The actual value of the trust was $52,000. The misrepresentation likely would delay the appointment of an independent trustee to oversee the operation of DECA and delay creditor’s access to books and records.
This was a joint investigation with the Federal Bureau of Investigations and the U.S. Bankruptcy Trustee.
FBI Special Agent in Charge W. Jay Abbott stated, “The FBI remains committed to seeking out those individuals that enhance their lifestyle through ill-gotten gains obtained by defrauding financial institutions.”
“I am grateful to Acting U.S. Attorney Minkler and our law enforcement partners for their strong commitment to combating fraud and abuse in bankruptcy cases as evidenced by today’s proceedings,” stated Nancy J. Gargula, U.S. Trustee for Indiana, Central Illinois, and Southern Illinois (Region 10).
The U.S. Trustee Program is the component of the Justice Department that protects the integrity of the bankruptcy system by overseeing case administration and litigating to enforce the bankruptcy laws. Region 10 is headquartered in Indianapolis, with additional offices in South Bend, Ind., and Peoria, Ill.
The charges resulted, in part, from a referral by the U.S. Trustee for Indiana and Central and Southern Illinois (Region 10) to the U.S. Attorney. Assistance with the investigation was provided by members of the Southern Indiana Bankruptcy Fraud Working Group coordinated by the U.S. Trustee.
According to Winfield Ong, Criminal Chief for the U.S. Attorney’s Office, Wolfe faces decades in prison and substantial fines if convicted.
A complaint is merely a charge and not proof of guilt. A defendant is presumed innocent and is entitled to a fair trial at which time the government must prove guilt beyond a reasonable doubt.
Former Teamster Leader Convicted of Extorting Boston BusinessesRead the Press Release
BOSTON – Two former members of a powerful Boston Teamsters local, including its principal officer and a member who had been convicted of a prior felony, were convicted today by a federal jury of extortion and racketeering, including charges that they extorted local non-profits.
John Perry, 62, of Woburn and Joseph “Jo Jo” Burhoe, 46, of Braintree, were convicted on multiple felony counts after a seven week trial. Perry, the former Secretary/Treasurer of Boston Teamster’s Local 82, and Burhoe, a member who acted as Perry’s enforcer, were convicted of extorting non-profits and other non-union businesses in Boston, as well as extorting other union members of their wages and benefits. Among the extortion victims were Brigham and Women’s Hospital, Massachusetts General Hospital, and the United States Green Building Council. Since the time of the crimes, Local 82 has been merged with Teamsters Local 25. Those Locals load and unload trucks at major business and entertainment venues in downtown Boston. Judge Denise Jefferson Casper set sentencing for Perry on Feb. 25, 2015 and Feb. 26, 2015 for Burhoe.
“Today’s verdict reconfirms our commitment to protecting those doing business in Boston from unions’ extortionate demands for personal payoffs or other illegitimate labor objectives,” said U.S. Attorney Carmen Ortiz. “We will also protect union members’ rights to democratic participation in the affairs of their union, including the right to vote on contracts that effect their livelihood, their right to file grievances, and their right to appear in court as a witness, without fear of intimidation or physical assault by union officials.”
United States Department of Labor Inspector General Scott S. Dahl stated, “Today’s convictions represent the Department of Labor, Office of Inspector General’s commitment to protect the American workforce from those who abuse their positions of trust and instill fear in others desiring simply to conduct an honest business. John Perry and his co-conspirator created a climate of fear and intimidation that deprived workers of their rights under the Labor Management Reporting and Disclosure Act. My office stands firmly committed to working with our law enforcement partners to combat this criminal activity.”
“I want to commend the great work and collaboration between the Boston Police Special Investigations Unit, the United States Attorney’s Office and the U.S. Department of Labor to bring about this verdict,” said Boston Police Commissioner William B. Evans. “Their efforts throughout this investigation were tireless and will ensure that Boston remains a world class city that attracts world class events.”
Perry, Director of Trade Shows and Convention Centers for the International Brotherhood of Teamsters Local 82, and Burhoe, a convicted felon who was a member of the union, worked in the trade show and moving industries. Since 2007 the defendants engaged in illegal activities in order to generate money for themselves, their friends, and family members. The defendants extorted various entities throughout Boston including hotels, event planners, catering companies, pharmaceutical companies, hospitals, music entertainment companies, and non-profit organizations, none of which had collective bargaining agreements with Local 82.
The defendants threatened to picket and disrupt business, sometimes just hours before an event, if the entity did not accede to the defendants’ demand for unwanted, unnecessary and superfluous jobs for themselves, their friends and family. Payment was demanded for these unnecessary Ajobs.@ They also used threats of physical and economic harm to deprive members of Local 82 of their legally-protected rights as union members.
The statutory maximum for each RICO/RICO Conspiracy and Hobbs Act extortion count is 20 years in prison to be followed by five years of supervised release, and a $250,000 fine for each count. The statutory maximum for other counts of conviction is up to 10 years in prison to be followed by three years of supervised release and a $10,000 fine. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Two other defendants were on trial with Perry and Burhoe. The jury was unable to reach a unanimous decision as to James Deamicis, a/k/a “Jimmy the Bull,” 51, of Quincy, and the Court declared a mistrial as to Deamicis. Thomas Flaherty, 50, of Braintree was acquitted.
U.S. Attorney Ortiz; Inspector General Scott S. Dahl; Mark J. Neylon, District Director, Office of Labor-Management Standards, U.S. Department of Labor; Susan A. Hensley, Regional Director of The Employee Benefits Security Administration, U.S. Department of Labor; and Commissioner Evans made the announcement today. The case is being prosecuted by Laura J. Kaplan and Susan G. Winkler of Ortiz’s Strike Force and Drug Task Force Units, respectively.Former Pastor Sentenced for ObscenityRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051ROCHESTER, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that Zackary S. Dressner, 38, of Rochester, NY, who was convicted of possession of obscene visual depictions of minors engaging in sexually explicit conduct, was sentenced to 30 months in prison by U.S. District Judge Charles J. Siragusa.
Assistant U.S. Attorney Bradley E. Tyler, who handled the case, stated that on November 18, 2011, members of the Federal Bureau of Investigation Computer Crimes Task Force went to the residence of the defendant and seized a desk top computer and four external hard drives. A subsequent forensic analysis found two videos and some still images depicting child pornography. At the time of seizures, Dressner was serving as pastor of the Southeast Bible Baptist Church and the Southeast Christian Academy in Penfield, NY.
The sentencing is the culmination of an investigation by the Federal Bureau of Investigation Computer Crimes Task Force.
Former Office Manager Indicted for Corporate FraudRead the Press Release
BATON ROUGE, LA - United States Attorney Walt Green announced today the unsealing of an indictment returned by a federal grand jury last week which charges LORI S. FRY, age 46, of Baton Rouge, Louisiana, with nine (9) counts of wire fraud, in violation of Title 18, United States Code, Section 1343. If convicted, the defendant could face significant incarceration, fines, restitution, forfeiture of proceeds, and supervised release following imprisonment.
The indictment alleges that the defendant embezzled approximately $465,000 from her employer, a specialty electrical engineering firm in Baton Rouge. According to the indictment, while working as a manager and bookkeeper at the firm, the defendant diverted over 100 separate payments from the firm’s account to her own personal use, through her personal bank account and otherwise.
U.S. Attorney Green stated: “Fraud threats loom virtually everywhere, but it is often the insider who poses the biggest danger in terms of both amount and duration. As our region continues to grow, it is increasingly important for us to remain vigilant against corporate fraud. My office will continue to do its part in combatting such criminality.”
This matter was investigated by the Baton Rouge office of the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Frederick A. Menner, Jr. and Special Assistant United States Attorney J. Brad Casey.
NOTE: An indictment is an accusation by the Grand Jury. The defendant is presumed innocent until and unless adjudicated guilty at trial or through a guilty plea.
Former North Carolina Man Sentenced for Transporting A Minor to North Carolina and Production of Child PornographyRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051ROCHESTER, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that William Schliebener, 52, formerly of Sanford, NC, who was convicted of transporting a minor in interstate commerce for the purpose of illegal sexual activity and production of child pornography, was sentenced to 300 months in prison by U.S. District Judge Frank P. Geraci, Jr.
Assistant U.S. Attorney John J. Field, who handled the case, stated that the defendant came to the attention of law enforcement in October 2010 when a young Canandaigua girl was reported missing. Members of the Canandaigua Police Department and the Lee County, North Carolina Sheriff’s Department found the child with the defendant in North Carolina. Schiebener transported the child from Canandaigua to North Carolina with the intent to engage in illegal sexual activity. Following the discovery of the child, a search warrant was executed at the defendant’s residence in North Carolina, and officers seized computers and digital media. Forensic analysis of the media revealed images of the defendant engaged in sexual activity with three children.
“This case demonstrates why it is so critical to identify and prosecute child predators to the fullest extent in law,” said U.S. Attorney Hochul. “The original arrest was for the attempted abuse of a single child, coupled with the defendant’s intention to digitally record and memorialize the attack. Investigation thereafter revealed the rape of three different children, each of which was also digitally recorded. Fortunately, this sentence means that this serial rapist will likely never again be in a position to harm children.”
The sentencing is the culmination of an investigation by Special Agents of the Federal Bureau of Investigation and Investigators of the Canandaigua Police Department, under the direction of Chief Jonathan P. Welch.
Former Millersburg Bus Company and Executive Plead Guilty to $1.4 Million Local School District Fraud SchemeRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania, announced today that a Millersburg bus company and one of its former officers pleaded guilty today to charges they defrauded two area school districts out of more than $1.4 million.
According to the U.S. Attorney Peter Smith, the Harris Transportation Corp. (HTC), and its former Vice President Todd M. Harris, age 49, a resident of Dalmatia, Pennsylvania, entered guilty pleas today before Senior U.S. District Court Judge Sylvia H. Rambo to an Information charging them with one count of Mail Fraud. The Information filed on November 5, 2014, charges the defendants with defrauding the Halifax Area and the Upper Dauphin Area School Districts out of approximately $1.4 million between 2008 and 2011. The Pennsylvania Department of Education (PDE) is also alleged to have been a victim of the scam. U.S. Attorney Smith stated that the school districts and PDE cooperated with the federal investigators and that the Department of the Auditor General is working closely with his office.
As presented by Assistant U.S. Attorney Kim Douglas Daniel in U.S. District Court in Harrisburg today, HTC, a small, family owned business, provided student bus and van transportation services for the Halifax and Upper Dauphin school districts for many years. The compensation HTC received for its services was based upon a formula set up by PDE, including mileage incurred with and without students, the age and size of the bus or van, and the number of students transported. Based on the formula, PDE reimburses school districts for a major portion of their annual student transportation expenses.
HTC received approximately $1.3 million from Halifax and approximately $3.6 million from Upper Dauphin during the school years 2008 to 2011. The criminal Information alleges that between September 2008 and June 2011, Todd Harris routinely submitted false and grossly inflated mileage claims to the two school districts, resulting in substantial overpayments to HTC by Halifax ($566,556) and by Upper Dauphin ($898,057). PDE also was a victim of the scheme because it reimbursed Halifax for approximately 82 percent, and Upper Dauphin approximately 84 percent, of their approved 2008-2011 student transportation expenses.
The fraud was first discovered in the summer of 2011 following an audit conducted by Upper Dauphin School District. Subsequent audits by the Halifax School District and the Pennsylvania Department of the Auditor General revealed the mileage statements submitted by Todd Harris were typically inflated by 10 to 30 percent. The State Auditors spent hundreds of hours reviewing billing issues and reported that Harris Transportation had over-billed the school districts by falsely reporting school bus mileage over several school years.
“We need every dollar possible going toward classroom education for our students, but I realize that student transportation costs can be a big expense for any school district,” Pennsylvania Auditor General Eugene DePasquale said. “I urge all school districts to review transportation contracts and records to make sure they are not paying more than appropriate. Our school auditors will continue to closely examine transportation expenses. I am proud of our continued work with the U.S. Department of Education’s Office of Inspector General and U.S. Attorney to identify and stop corruption when we find it.”
The Auditor General’s audit reported that Harris Transportation Corp. greatly over-billed the districts by falsely reporting school bus mileage over several school years. Auditors spent hundreds of hours reviewing the transportation billing issues, ultimately referring the case to federal officials.
Interviews of former HTC drivers confirmed Todd Harris’ monthly mileage submissions were inflated and that Harris occasionally instructed them to take much longer routes on their runs than necessary. The investigation confirmed the combined losses sustained by both school districts for school years 2008 to 2011 totaled $1,464,613. Upper Dauphin and Halifax terminated their contracts with HTC in early 2012. The company ceased doing business shortly thereafter.
Todd Harris and HTC entered their guilty pleas pursuant to plea agreements with the government. The agreements require the defendants to cooperate with the government, to forfeit their interests in the $1,464,613 proceeds of the fraud, and to make restitution to the two school districts as directed by the court.
HTC’s plea agreement also required it to make a $425,000 lump sum restitution payment at the time it entered its guilty plea. Counsel for the corporation tendered a $188,000 check to the court as partial payment during the guilty plea hearing and agreed to pay the remaining $237,000 by Friday November 22, 2014. The HTC plea agreement also acknowledges that HTC refunded an additional amount, $337,715, to Upper Dauphin in 2011, bringing the total restitution paid by the corporation to date to $762,715.
The Mail Fraud charge has a maximum sentence of up to 20 years in prison and a $250,000 fine. Sentencing has been deferred pending preparation of Presentence Reports.
The case was investigated by the U.S. Department of Education, Office of Inspector General, in conjunction with the Dauphin County Criminal Investigation Division and Office of General Counsel of the Pennsylvania Department of the Auditor General. The case is being prosecuted by Assistant United States Attorney Kim Douglas Daniel.
Former McLennan County Justice of the Peace Sentenced to Federal Prison on Theft ChargeRead the Press Release
In Waco today, 60-year-old former McLennan County Justice of the Peace Erma Jean Laster Boone was sentenced to 9 months in federal prison in connection with a scheme to steal Social Security Income benefits announced United States Attorney Robert Pitman.
In addition to the prison term, United States District Judge Walter S. Smith, Jr. ordered that Boone pay a $5,000 fine and be placed on supervised release for a period of three years after completing her prison term.
On September 11, 2014, Boone pleaded guilty to theft of Government property. According to court records, Robert Martin Davis died on May 27, 2010, and the defendant was the reporting party on Davis’ death certificate. From Davis’ death until October 2013, the Social Security Administration continued to deposit Social Security benefits, which totaled approximately $63,000, into Davis’ bank account. The defendant had access to Davis’ bank account. Boone admitted to authorities that she spent over $16,000 from Davis’ account on “fixing stuff up around the house.” In March 2014, Boone paid back to the Social Security Administration the money she had fraudulently embezzled and used.
This investigation was conducted by the United States Social Security Administration, Office of Inspector General. Assistant United States Attorney Greg Gloff prosecuted this case on behalf of the Government.
Former Las Cruces Detective Sentenced to Nine Years for Sexually Assaulting Police Department InternRead the Press Release
Michael Garcia, 38, a former detective with the Las Cruces Police Department (LCPD) in Las Cruces, New Mexico, was sentenced today for violating the civil rights of an LCPD student intern. Garcia was sentenced to nine years in prison followed by five years of supervised release. Garcia also was ordered to forfeit his law enforcement certification and comply with federal and state sex offender registration requirements.
Garcia pled guilty on April 17, 2014, to a one-count information charging him with violating the civil rights of the victim by sexually assaulting her. At the time of the assault, Garcia was assigned to a unit that focused on child abuse and sex crimes investigations. According to court documents, Garcia—in his role as a detective—worked with students who participated in Las Cruces High School’s Excel program, through which students interned at the LCPD. On or about May 4, 2011, Garcia took the victim on a ride-along in his department-issued vehicle to visit a crime scene. Afterward, instead of driving the victim directly back to the police department so that she could retrieve her belongings and go home, Garcia drove her to a secluded location where he sexually assaulted her.
“The defendant abused his authority as a sex crimes detective in the most horrific way, exploiting the victim’s trust in him to commit his egregious acts,” said Acting Assistant Attorney General Vanita Gupta for the Civil Rights Division. “The Civil Rights Division will continue to vigorously prosecute law enforcement officers who use the power of their position to engage in sexual abuse. The victim showed tremendous bravery when she came forward, and we are thankful for the law enforcement officers in this case, as well as the vast majority of others, who support and help victims of crime.”
“Our system of justice is clear and unequivocal – every law enforcement officer must follow the laws they are sworn to enforce,” said U.S. Attorney Damon P. Martinez for the District of New Mexico. “Any time a law enforcement officer breaks the law it undermines the public’s trust in the legal system, and we will do everything we can to ensure that trust is not compromised.”
“Law enforcement officers receive a lot of authority in order to serve their community, and the majority of them use that power wisely,” said Special Agent in Charge Carol K.O. Lee of the FBI’s Albuquerque Division. “But when an officer tramples on the civil rights of someone he swore to protect, it's up to the FBI and our partners to make sure that violator is investigated and prosecuted to the full extent of the law. I would like to thank the Las Cruces Police Department for assisting with this investigation, and congratulate the U.S. Attorney's Office on its successful prosecution.”
This case was investigated by the Las Cruces Resident Agency of Albuquerque Division of the FBI and the LCPD and was prosecuted by Assistant U.S. Attorney Holland S. Kastrin for the District of New Mexico and Trial Attorney Fara Gold of the Justice Department’s Civil Rights Division.
Former Las Cruces Detective Sentenced to Nine Years for Sexually Assaulting Police Department InternRead the Press Release
ALBUQUERQUE – Michael Garcia, 38, a former detective with the Las Cruces Police Department (LCPD) in Las Cruces, N.M., was sentenced today for violating the civil rights of an LCPD student intern. Garcia was sentenced to nine years in prison followed by five years of supervised release. Garcia also was ordered to forfeit his law enforcement certification and comply with federal and state sex offender registration requirements.
Garcia pled guilty on April 17, 2014, to a one count information charging him with violating the civil rights of the victim by sexually assaulting her. At the time of the assault, Garcia was assigned to a unit that focused on child abuse and sex crimes investigations. According to court documents, as a detective, Garcia worked with students who participated in Las Cruces High School’s Excel program, through which students interned at the LCPD. On or about May 4, 2011, Garcia took the victim on a ride-along in his department-issued vehicle to visit a crime scene. Afterward, instead of driving the victim directly back to the police department so that she could retrieve her belongings and go home, Garcia drove her to a secluded location where he sexually assaulted her.
“The defendant abused his authority as a sex crimes detective in the most horrific way, exploiting the victim’s trust in him to commit his egregious acts,” said Acting Assistant Attorney General Vanita Gupta for the Civil Rights Division. “The Civil Rights Division will continue to vigorously prosecute law enforcement officers who use the power of their position to engage in sexual abuse. The victim showed tremendous bravery when she came forward, and we are thankful for the law enforcement officers in this case, as well as the vast majority of others, who support and help victims of crime.”“Our system of justice is clear and unequivocal – every law enforcement officer must follow the laws they are sworn to enforce,” said U.S. Attorney Damon P. Martinez. “Any time a law enforcement officer breaks the law it undermines the public’s trust in the legal system, and we will do everything we can to ensure that trust is not compromised.”
“Law enforcement officers receive a lot of authority in order to serve their community, and the majority of them use that power wisely. But when an officer tramples on the civil rights of someone he swore to protect, it's up to the FBI and our partners to make sure that violator is investigated and prosecuted to the full extent of the law,” said Special Agent in Charge Carol K.O. Lee of the FBI’s Albuquerque Division. “I would like to thank the Las Cruces Police Department for assisting with this investigation, and congratulate the U.S. Attorney's Office on its successful prosecution.”
This case was investigated by the Las Cruces Resident Agency of Albuquerque Division of the FBI and the LCPD and was prosecuted by Assistant U.S. Attorney Holland S. Kastrin for the District of New Mexico and Trial Attorney Fara Gold of the Justice Department’s Civil Rights Division.
Former Corrections Officer Pleads Guilty to Participating in Scheme to Smuggle Drugs into Otero County PrisonRead the Press Release
ALBUQUERQUE – Luis Delgadillo, 38, of El Paso, Texas, pled guilty today to an indictment charging him with conspiracy to distribute methamphetamine and heroin into the Otero County Prison Facility (OCPF) in Chaparral, N.M. At the time of the indictment, Delgadillo was employed as a corrections officer at OCPF. Delgadillo is the last of six defendants to enter a guilty plea in this case.
Delgadillo was indicted in Aug. 2014, on a drug trafficking conspiracy charge together with Gary Borja 26, Armando Lopez, 28, and Ana Lopez, 26, all of Albuquerque, N.M.; Nancy Salas, 35, of Alamogordo, N.M., and Eric Lovato, 30, of Boles Acres, N.M. The six defendants were charged with participating in a conspiracy to smuggle drugs into the OCPF between Dec. 2013 and April 2014, when Borja, Armando Lopez and Lovato were inmates at the facility and Delgadillo was a corrections officer.
According to court filings, the FBI initiated an investigation into the case in Jan. 2014, after receiving information from the New Mexico Corrections Department (NMDOC) allegedly showing that Delgadillo was smuggling heroin and methamphetamine into the OCPF. The investigation, which included a review of recorded inmate telephone calls and OCPF surveillance video, physical surveillance and the results of inmate drug testing, identified the six defendants as members of a conspiracy to allegedly smuggle narcotics into the OCPF between Jan. 2014 and April 2014.
In entering his guilty plea, Delgadillo admitted participating in a conspiracy to smuggle drugs into the OCPF between Dec. 2013 and April 2014. Delgadillo admitted smuggling an ounce of methamphetamine into the OCPF in Dec. 2013; an ounce of heroin in Feb. 2014; and another ounce of heroin in April 2014. He also admitted that on April 26, 2014, he met with Ana Lopez and obtained 25 grams of methamphetamine, 11 grams of heroin and 10 suboxone pills from her. He was arrested before he was able to smuggle the drugs into the OCPF.Each of the six defendants faces a statutory maximum penalty of 20 years in prison when sentenced. They remain in federal custody pending their sentencing hearing, which have yet to be scheduled.
This case was investigated by the Las Cruces office of the FBI and the New Mexico Corrections Department and is being prosecuted by Assistant U.S. Attorney Mark A. Saltman of the U.S. Attorney’s Las Cruces Branch Office.
- Former Correctional Officer and Spouse Sentenced for Bribery and Conspiracy
Former Clinton County Postmaster Sentenced to Two Years' Probation for EmbezzlementRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced today that United States District Court Judge Matthew W. Brann sentenced Macey Geyer, age 42, of Castanea, Clinton County, to two years’ probation and ordered her to pay $9,230 in restitution for misappropriation of postal funds.
According to United States Attorney Peter Smith, Geyer took over $9,000 in postal funds from the Castanea Post Office. Geyer, who began her employment with the United States Post Service on June 23, 2007, served as Officer-in-Charge at the Castanea Post Office. The Postal Service terminated her employment in April 2014.
Geyer pleaded guilty on July 8, 2014.
The case was investigated by the United States Postal Service, Office of Inspector General. Assistant United States Attorney Eric Pfisterer prosecuted the case.
Federal Grand Jury Indicts Monahans Man for Oil Theft SchemeRead the Press Release
In Midland, a federal grand jury returned an indictment charging a Monahans, TX, man in connection with a scheme to steal an estimated $58,000 worth of oil announced United States Attorney Robert Pitman and Federal Bureau of Investigation Special Agent in Charge Douglas C. Lindquist, El Paso Division.
The indictment charges 33–year-old David Wayne Schroeder with three counts of theft from an interstate shipment. The indictment alleges that on three separate occasions in November and December 2013, Schroeder stole oil from different Permian Basin companies. The final incident, according to court records, occurred during the evening hours of November 30, 2013, and into the early morning hours of December 1, 2013, when Schroeder used a stolen vacuum truck and trailer to steal five tankerloads (approximately 520 barrels) of oil from a Whiting Petroleum lease in Ward County. Schroeder delivered the stolen oil to Itero Energy’s site in Monahans for payment. A Ward County Sheriff’s deputy dispatched to investigate a possible stolen vacuum truck on Itero’s site witnessed Schroeder off-loading oil and attempted to question him. After a brief altercation with the deputy, Schroeder managed to flee the scene in a stolen vehicle, but was apprehended later that morning in Monahans. Investigators discovered Schroeder had left four tickets each documenting a separate tanker load delivered to Itero Energy’s site. In the normal course of business, the tickets would have justified and likely led to Itero Energy’s payment for the oil deliveries.
This investigation was conducted by the FBI’s Permian Basin Oilfield Theft Task Force, which consists of federal agents as well as law enforcement officers from the Midland County Sheriff’s Office and the Andrews County Sheriff’s Office. Assistant United States Attorney John Klassen is prosecuting this case on behalf of the Government.
Upon conviction of each theft charge, Schroeder faces up to 20 years in federal prison. Schroeder remains in federal custody pending trial. No trial date has been scheduled.Fairmont, WV Man Charged with Stealing Government MoneyRead the Press Release
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(304) 234-0100 ● Contact: Tara Tighe, Public Affairs SpecialistMARTINSBURG, WEST VIRGINIA – A federal grand jury returned an indictment charging former United States Forest Service employee Kwaku A. Akomah, 40, of Fairmont, West Virginia, with stealing government money, United States Attorney William J. Ihlenfeld, II, announced today.
A Forest Service investigation revealed that Akomah made repeated unauthorized purchases using government funds. He made a variety of unauthorized personal purchases, including the use of a government issued fuel card to procure more than $1,000.00 in gasoline for his personal vehicle.
Akomah is charged with two counts of “Theft of Government Money.” He faces up to 10 years in prison and a fine of up to $250,000.00 on each count. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Fairfield Resident Sentenced to Federal Prison for Tax EvasionRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that ROBERT JOSEPH PARKER, 52, of Fairfield, was sentenced today by U.S. District Judge Janet Bond Arterton in New Haven to 18 months of imprisonment, followed by three years of supervised release, for tax evasion.
According to court documents and statements made in court, PARKER earned income by providing information technology services to various businesses. Between 1996 and 2012, PARKER did not pay any federal income tax on approximately $2 million of income he received in his own name, and in the name of his alter ego entity known as Success Zone, LLC.
As part of his sentence, PARKER was ordered to pay $1,869,419 in taxes, interest and penalties for himself personally for tax years 1996 through 2012, and for Success Zone, LLC, for tax years 2003 through 2012.
On March 5, 2014, PARKER waived his right to indictment and pleaded guilty to one count of tax evasion.
This case was investigated by the Internal Revenue Service – Criminal Investigation Division and was prosecuted by Senior Litigation Counsel Richard J. Schechter.
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[email protected]Excelsior Springs Man Faces Additional Charges Related to Meth ConspiracyRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that additional charges were contained in an indictment returned by a federal grand jury today against an Excelsior Springs, Mo., man related to his role in a conspiracy to manufacture methamphetamine.
Anthony Trurice Grayson, 30, of Excelsior Springs, was charged in a five-count indictment returned by a federal grand jury in Kansas City, Mo. Today’s superseding indictment replaces an Aug. 7, 2013, federal indictment that only charged Grayson with one count of conspiracy.
Today’s indictment alleges that Grayson participated in a conspiracy to manufacture methamphetamine from July 1 to July 16, 2013. Grayson is also charged with aiding and abetting others to manufacture methamphetamine, aiding and abetting others to possess pseudoephedrine to be used to manufacture methamphetamine, maintaining a residence that was available for the purpose of unlawfully manufacturing, storing and/or using methamphetamine and being a felon in possession of explosives.
This case is being prosecuted by Special Assistant U.S. Attorney Jeff Q. McCarther. It was investigated by the Drug Enforcement Administration.Employee of Check-Cashing Company Pleads Guilty to Involvement in Identity Theft SchemeRead the Press Release
A Georgia woman pleaded guilty today to one count of conspiracy to commit wire fraud for her involvement in a stolen identity tax refund fraud (SIRF) scheme, Acting Deputy Assistant Attorney General Larry J. Wszalek for the Justice Department's Tax Division and U.S. Attorney George L. Beck Jr. for the Middle District of Alabama announced.
Lashelia Alexander worked for a check cashing business in a Columbus, Georgia, Walmart, according to court documents. In January 2014, Alexander was approached by several co-conspirators about cashing fraudulent tax refund checks issued in the names of third parties and in return, Alexander would receive a portion of the refunds. Alexander’s co-conspirators electronically filed fraudulent and unauthorized federal income tax returns for 2013 using the personal identifying information of numerous identity theft victims. Alexander’s co-conspirators printed out the fraudulent tax refund checks using check stock provided by a financial institution. Alexander cashed more than $100,000 in fraudulently obtained third-party refund checks containing forged endorsements.
Alexander’s sentencing date has not yet been scheduled. She faces a statutory maximum sentence of 20 years in prison and a maximum fine of $250,000 for the wire fraud conspiracy.
The case was investigated by special agents of the Internal Revenue Service - Criminal Investigation. Trial Attorneys Michael C. Boteler and Gregory P. Bailey of the Tax Division are prosecuting the case with the assistance of Assistant U.S. Attorney Todd Brown for the Middle District of Alabama.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Elizabeth City Drug Dealer Sentenced in Federal CourtRead the Press Release
RALEIGH – United States Attorney Thomas G. Walker announced that in federal court, United States District Judge Terrence W. Boyle sentenced Lamont Nicholas Riddick , 37, of Elizabeth City, NC to 150 months’ imprisonment, followed by five years of supervised release. RIDDICK was also ordered to pay $1,900 in restitution to the Pasquotank County Sheriff’s Office.
Riddick was named in a Criminal Indictment filed on April 8, 2014 charging him with one count of conspiracy to distribute and possess with the intent to distribute 500 grams of cocaine and 28 grams of cocaine base (crack) from September, 2012, until May 2, 2013; and four counts of distribution of cocaine base (crack) on separate occasions from February through May of 2013. On August 11, 2014, Riddick pled guilty to the conspiracy charge alleged in Count One.
According to the investigation, officers with the Pasquotank County Sheriff’s Office and Elizabeth City Police Department utilized a confidential informant to make controlled purchases of over 34 grams of cocaine base (crack) from RIDDICK during a time period spanning from February to May of 2013. Investigation revealed that upon being released from prison on July 16, 2012, after serving approximately 10 years as a habitual felon for Possession With Intent to Manufacture, Sell, and Deliver a Schedule I Controlled Substance, RIDDICK began distributing cocaine and cocaine base (crack) around the Elizabeth City area in September, 2012. RIDDICK was involved in the distribution of approximately 34.93 grams of cocaine base (crack) and over 2.1 kilograms of cocaine during the time period of the conspiracy.
Investigation of this case was conducted by the Elizabeth City Police Department and Pasquotank County Sheriff’s Office. Special Assistant United States Attorney Augustus Willis represented the government. Mr. Willis is a prosecutor with the District 3-B District Attorney’s Office encompassing Carteret, Craven and Pamlico Counties. District Attorney Scott Thomas has assigned him to the United States Attorney’s Office to prosecute federal Organized Crime Drug Enforcement Task Force criminal matters. Mr. Wills’ position is funded through a grant provided by the Governor’s Crime Commission.
Eleven Individuals Charged for Their Role in Medicare and Medicaid Fraud Scheme Executed in Florida, Nicaragua, and the Dominican RepublicRead the Press Release
Eight residents of Miami-Dade County and three residents of Nicaragua have been charged for their alleged participation in a $25.2 million Medicare, Medicaid, and wire fraud scheme.
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Pam Bondi, Florida Attorney General, Derrick L. Jackson, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Wendy A. Bashnan, Special Agent in Charge, U.S. Department of State, Diplomatic Security Service (DSS), made the announcement.
On October 30, 2014, a federal grand jury in Miami returned a 36-count indictment charging Pedro Hernandez, a/k/a “Peter Hernandez,” 51, of Miramar, Freddy Zeron, 52, of Miami and Nicaragua, Erendira V. Delgado, a/k/a “Eren Delgado,” 31, of Miami, Edgardo Rodriguez, 47, of Homestead and Nicaragua, Rodney Montoya, 36, of Miami, Santiago Bernabe Montoya, 72, of Miami, Jose Eloy Sanchez, a/k/a “Jose Eloy Sanchez Arguello,” 70, of Coral Gables and Nicaragua, Abram J. Rodriguez, a/k/a “Abe Rodriguez,” 31, of Miami, Mirna L Blanco, 49, of Hialeah, Deborah Smith, 53, of Hialeah, and Augustin Abaga, 48, of Sunny Isles, for allegedly participating in a scheme to defraud Medicare and Medicaid by submitting false and fraudulent enrollment applications which claimed that beneficiaries resided in Florida when, in fact, they resided in Nicaragua and the Dominican Republic. Eight individuals have been arrested, Freddy Zeron, Edgardo Rodriguez and Jose Eloy Sanchez remain at large.
In addition to the indictment, we are pursuing a parallel civil action to freeze the assets of various defendants for approximately $10 million in fraudulent proceeds.
The defendants are charged with conspiracy to commit health care fraud and wire fraud, substantive counts of health care fraud, conspiracy to defraud the United States and make false statements related to health care matters and substantive counts of making false statements related to health care matters.
As alleged in the indictment:
FHCP was authorized by the Centers for Medicare and Medicaid Services to offer Medicare Advantage HMO plans to Medicare beneficiaries residing in Miami-Dade County, among other counties in Florida. All defendants recruited individuals who resided in Nicaragua and the Dominican Republic to enroll in Medicare Advantage plans and Florida Medicaid by falsely and fraudulently representing in enrollment applications that they resided in Florida. In these enrollment applications, the defendants represented that the foreign residents resided in Florida by using non-residential addresses, the addresses belonging to friends and relatives of these foreign residents, and addresses associated with the defendants. The defendants induced the individuals residing in Nicaragua and the Dominican Republic to enroll in Medicare Advantage plans, including FHCP plans, by making false and fraudulent representations, including that Medicare benefits were available in Nicaragua and the Dominican Republic. As a result of the submission of these false and fraudulent enrollment applications, the defendants caused the Center for Medicare and Medicaid services to make monthly capitation payments to FHCP and other Medicare Advantage plans. The defendants also caused the Florida Medicaid program to pay Medicare premiums and deductibles for many beneficiaries who did not reside in Florida, a benefit for which non-Florida residents would not be entitled.
Additionally, the defendants caused physicians associated with Pharmovisa Inc., Axis Le Professional Medical Group, Inc., and Rodney Montoya Corp., where defendant Santiago B. Montoya was employed as a physician, each located in Miami, to be designated as the primary care physicians for the beneficiaries residing in Nicaragua and the Dominican Republic. The defendants paid for the beneficiaries to travel from the Dominican Republic and Nicaragua so that they could be seen by a U.S. licensed physician. The physician would then provide diagnoses which were used to calculate the amount of money FHCP and other Medicare Advantage plans would receive from Medicare. As a result of these false and fraudulent enrollment applications, the defendants obtained approximately $25,247,413 from Medicare and Florida Medicaid.
According to the indictment, Hernandez was the chief operating officer of FHCP until May 8, 2013, Abram Rodriguez was the marketing director until on or about April 21, 2014. Smith and Abaga were insurance agents employed by FHCP during the time of the scheme was ongoing. Blanco was employed by FHCP, as well as, Axis Le and Rodney Montoya Corp.
“Health care fraud is a devastating crime that threatens the strength and integrity of our health care system,” said U.S. Attorney Ferrer. “We are dedicated to protecting Medicare from fraud and abuse to ensure that beneficiaries of federal health care programs receive appropriate medical care. The charges announced today demonstrate that law enforcement in Miami will continue to fight the battle against health care fraud locally and across our borders.”
Florida Attorney General Pam Bondi stated, “This sophisticated $25 million Medicare and Medicaid fraud scheme that claimed that residents of Nicaragua and the Dominican Republic resided in Florida essentially stole from taxpayers. We will continue to partner with the Office of the United States Attorney and other federal agencies to investigate and prosecute those who defraud our Medicaid program.”
“Providing Medicare services in foreign countries but billing as if they occurred in the United States is in-your-face fraud,” said Derrick L. Jackson, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General over Florida. “But our agents have a global reach, working with our law enforcement partners to track down and charge those responsible regardless of where they are in the world.”
“Unfortunately, scams that bilk our health care system do not stop at our borders,” said George L. Piro, Special Agent in Charge, FBI Miami. “These fraudsters sought out and recruited residents of Nicaragua and the Dominican Republic to swindle U.S. taxpayer dollars from the Medicare and Medicaid programs. We are pleased to have put these unscrupulous operators out of business.”
Mr. Ferrer commended FBI, HHS-OIG, the Florida Office of the Attorney General, Medicaid Fraud Control Unit, and DSS for their investigative efforts. The case is being prosecuted by Assistant U.S. Attorney Eric E. Morales and Special Assistant United States Attorney Hagerenesh Simmons.
Mr. Ferrer also thanked U.S. Department of State, Diplomatic Security Service, Regional Security Office, at the U.S. Embassies in Managua and Santo Domingo for their assistance with this investigation.
This case, brought as part of the Medicare Fraud Strike Force, under the supervision of U.S. Attorney’s Office for the Southern District of Florida, is being prosecuted by Assistant U.S. Attorney Eric E. Morales and Special Assistant U.S. Attorney Hagernesh Simmons. The civil parallel proceeding is being handled by Assistant U.S. Attorney Franklin G. Monsour.
Since their inception in March 2007, Medicare Fraud Strike Force operations in nine locations have charged more than 1,650 defendants who collectively have falsely billed the Medicare program for more than $4.5 billion. In addition, the Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
An indictment is only an accusation and a defendant is presumed innocent unless and until proven guilty.
Attachment:
Indictment - Pedro Hernandez (PDF)
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.
Eastern District of Virginia U.S. Attorney’s Office Collects over $23.6 Million in Civil and Criminal Actions for U.S. Taxpayers in Fiscal Year 2014Read the Press Release
ALEXANDRIA, Va. – Dana J. Boente, U.S. Attorney for the Eastern District of Virginia (EDVA), announced today that EDVA collected over $23.6 million in criminal and civil actions in Fiscal Year 2014. Of this amount, over $15.4 million was collected in criminal actions and more than $8.1 million was collected in civil actions
Additionally, EDVA worked with other U.S. Attorneys’ offices and components of the Department of Justice to collect an additional $8.8 million in cases pursued jointly with these offices.
Attorney General Eric Holder announced on November 19, 2014 that the Justice Department collected $24.7 billionin civil and criminal actions in the fiscal year ending Sept. 30, 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.”
“In all of our criminal and civil prosecutions, where appropriate, we strive to collect restitution for the victims of the crime, be that private citizens or the federal government” said U.S. Attorney Boente. “Asset forfeiture, fines, restitution and other means of collections are the Justice Department’s most effective and efficient tools in restoring money to victims of crime and their families.”
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.
Eastern District of Tennessee U.S. Attorney’s Office Collects $6,284,548.95 in Civil and Criminal Actions for U.S. Taxpayers in Fiscal Year 2014Read the Press Release
KNOXVILLE, Tenn. - U.S. Attorney William C. Killian announced today that the Eastern District of Tennessee collected $6,284,548.95 in criminal and civil actions in Fiscal Year 2014. Of this amount, $4,538,338.33 was collected in criminal actions and $1,746,210.62 was collected in civil actions.
Additionally, the Eastern District of Tennessee worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $8,984,509.29 in cases pursued jointly with these offices. Of this amount, $400.00 was collected in criminal actions and $8,984,109.29 was collected in civil actions.
Attorney General Eric Holder announced on Wednesday, Nov. 19, 2014, that the Justice Department collected $24.7 billion in civil and criminal actions in the fiscal year ending Sept. 30, 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.”
“We are proud of the amounts collected in the Eastern District of Tennessee. These collections represent either assets acquired by criminal activity or fines and penalties assessed by the court as a result of illegal activity. Our staff works hard to collect these monies which help lower the burden on the taxpayers,” said U.S. Attorney Bill Killian.
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 Eastern District of Tennessee, working with partner agencies and divisions, collected $6,423,352 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.
Eastern District of California U.S. Attorney’s Office Collects over $9 Billion in Civil and Criminal Actions for U.S. Taxpayers in Fiscal Year 2014Read the Press Release
SACRAMENTO, Calif. — U.S. Attorney Benjamin B. Wagner announced today that the Eastern District of California collected a record amount for American taxpayers in Fiscal Year 2014, which ended September 30, 2014. The office, on its own and with other U.S. Department of Justice components, collected over $9 billion in Fiscal Year 2014. These figures reflect actual amounts collected, not judgment amounts.
The office collected $21,303,839 in criminal and civil actions it handled alone in the fiscal year. Of this amount, $8,183,129 was collected in criminal actions, including both fines and restitution for victims, and $13,120,710 was collected in civil actions. Additionally, the Eastern District worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $8,979,244,434 in cases pursued jointly with those offices. Almost this entire amount is attributable to recoveries resulting from the settlement of the JPMorgan Chase case, including a $2 billion penalty directly attributable to this office’s investigation of wrongdoing relating to the sale of residential mortgage-backed securities by JPMorgan Chase. The total settlement was announced last November.
For the nation as a whole, Attorney General Eric Holder announced today that the Justice Department collected $24.7 billion in civil and criminal actions in Fiscal Year 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. Attorneys’ 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.”
“This year was a record year for collections by this office, and I congratulate my team for the hard work reflected in these numbers” said U.S. Attorney Wagner. “We will remain dedicated to protecting the public, vigorously pursuing funds that rightfully belong to U.S. taxpayers, and seeking compensation for victims of federal crimes.”
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.
Included in the recovery figures, is a $9.9 million settlement with Medtronic Inc. of Fridley, Minnesota, to resolve allegations under the False Claims Act that the company used various types of payments to induce physicians to implant pacemakers and defibrillators manufactured and sold by Medtronic. The settlement was the result of a coordinated effort among the Department of Justice’s Civil Division, Commercial Litigation Branch; the U.S. Attorney’s Office for the Eastern District of California; and the Office of Inspector General of the U.S. Department of Health and Human Services.
Additionally, the U.S. Attorney’s office in the Eastern District of California, working with partner agencies and divisions, collected $25,637,920 in asset forfeiture actions in FY 2014. The fiscal year was also a record for judicial asset forfeitures in the Eastern District of California. 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.
In one asset forfeiture that arose in a criminal case this past May, this office recovered more than $6.6 million as part of the forfeiture agreement in the U.S. v. Victor Anthony Nottoli case. Nottoli pleaded guilty to a conspiracy to distribute at least 24 tons of misbranded smokable synthetic cannabinoids in retail outlets throughout the U.S. and from his six smoke shops in Fresno and Bakersfield.East Longmeadow Woman Charged with Embezzling Funds from Retirement CommunityRead the Press Release
BOSTON – A former East Longmeadow woman was arrested today in Virginia after being charged in U.S. District Court in Springfield with embezzling funds from a retirement community.
Alice Lacroix, 53, was indicted on eight counts of wire fraud, eight counts of money laundering, and two counts of aiding and abetting the filing of false tax returns.
The indictment alleges that Lacroix, who was the manager of Bluebird Estates, a retirement living community in East Longmeadow, embezzled funds from her employer by stealing rent checks paid by tenants, as well as other checks and property belonging to her employer. It is alleged that Lacroix established a bank account in the name of Bluebird Estates into which she deposited the embezzled funds and then engaged in financial transactions designed to disguise the proceeds of the fraudulent scheme. Lacroix deceived her employer through emails that provided false information about the rent payments she took. The indictment also alleges that Lacroix aided and abetted in the filing of false income tax returns.
The maximum sentence under the wire fraud and money laundering statutes is 20 years in prison, three years of supervised release and a fine of $250,000. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz; William P. Offord, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; Colonel Timothy P. Alben, Superintendent of the Massachusetts State Police; and East Longmeadow Police Chief Douglas Mellis, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Alex Grant of Ortiz’s Springfield Branch Office.
The details contained in the indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
District of Montana Collects $14.1 Million in Civil & Criminal Actions in FY 2014Read the Press Release
HELENA - U.S. Attorney Michael W. Cotter announced today that the Montana United States Attorney's Office collected $14.1 million in Fiscal Year (FY) 2014 related to criminal and civil actions and an additional $3.4 million related to criminal and civil forfeiture. In some of these cases, the U.S. Attorney's Office worked in conjunction with litigating components of the U.S. Department of Justice.
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. Generally, these debts are judgments, either civil judgments or criminal judgments entered by the federal court. Criminal judgments consist of fines and restitution. 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 directly 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.
Occasionally, assets from criminals are forfeited by court action. Forfeiture proceeds are often distributed back to local law enforcement to assist them in the protection of Montana communities or to the victims of crime. Forfeited assets include currency or bank accounts, real property and cars purchased with illegal proceeds or used to facilitate crimes, guns held by convicted felons, and computers used for child pornography. Seized property is sold and the money deposited into the government accounts used to restore money lost by crime victims.
Across the country, the United States Attorneys' offices collected $24 billion from criminal and civil actions during FY 2014, which is far more than the $2.91 billion appropriated budget of the combined 93 USAOs offices for fiscal year 2014. The U.S. Attorney's Office in Montana is credited with collecting $2.4 million in relation to criminal actions brought by the office. Approximately $11.7 million was collected related to civil matters, with over $4 million related to healthcare fraud, and $1.3 million in relation to civil environmental violations. In addition $3.4 million was collected in criminal and civil forfeiture cases.
“The efforts of this office to serve the people of Montana will continue. Reduced resources will make it more difficult to maintain the same level of service for law enforcement protection, for public safety or the protection of the public purse. But this office is committed to maintaining the highest ideals of public trust and public service despite those challenges.” --- U.S. Attorney Mike Cotter.
District of Arizona U.S. Attorney’s Office Collects $44,585,929 in Civil and Criminal Actions for U.S. Taxpayers in Fiscal Year 2014Read the Press Release
PHOENIX - U.S. Attorney John S. Leonardo announced today that the District of Arizona collected $44,585,929 in criminal and civil actions in Fiscal Year 2014. Of this amount, $4,020,746 was collected in criminal actions and $40,565,182 was collected in civil actions
Additionally, the District of Arizona worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $161,247in cases pursued jointly with these offices. Of this amount, $6,739 was collected in criminal actions and $154,507 was collected in civil actions.
Attorney General Eric Holder announced today that the Justice Department collected $24.7 billionin civil and criminal actions in the fiscal year ending Sept. 30, 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.”
“It’s been another very productive year for our District,” said U.S. Attorney John S. Leonardo. “Our people have done a great job working with our local communities and partner law enforcement agencies in our joint collection efforts. These funds are owed to victims of crime, as well as taxpayers, and we strive to be as effective as we can in collecting them.”
The U.S. Attorneys’ Offices, alongside DOJ’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 Arizona, working with partner agencies and divisions, collected $10,312,162 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.
RELEASE NUMBER: 2014-064_FY14 Collections
The full video of the Attorney General’s message is available at http://www.justice.gov/agwa.php.
For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.District Man Sentenced to Seven Years in Prison for Broad Daylight Carjacking at Gas StationGood Samaritans Came to Victim’s Aid; Quick Police Work Led to ArrestRead the Press Release
WASHINGTON – Byron Dunn, 25, of Washington, D.C., has been sentenced to a seven-year prison term for a carjacking that took place earlier this year at a gas station in Northeast Washington, U.S. Attorney Ronald C. Machen Jr. announced.
Dunn pled guilty to a carjacking charge in September 2014, in the Superior Court of the District of Columbia. He was sentenced on Nov. 18, 2014 by the Honorable Anita Josey-Herring. Upon completion of his prison term, he will be placed on three years of supervised release.
According to the government’s evidence, Dunn approached the victim on May 20, 2014, at about 11:15 a.m., at a gas station in the 3700 block of Minnesota Avenue NE. Dunn asked if he could take some photographs of the victim’s car, a silver 2006 Chrysler 300 with 24-inch chrome rims. The victim agreed, rolled up his windows, and went to pay for his fuel. When the victim returned and started pumping gas, Dunn stood next to him. Dunn brandished a handgun and ordered the victim to give up his keys. When the victim ran away from the gas station, Dunn gave chase, and caught up to the victim. Dunn ordered the victim back to his car, and threatened to shoot him unless he handed over the keys. Moments later, three people pulled into the station in a Chevy Suburban. One confronted Dunn while another urged the victim to drive away.
The victim managed to escape and he quickly flagged officers with the Metropolitan Police Department (MPD). Police stopped Dunn a few minutes later and recovered a loaded .45-caliber handgun. Dunn has been in custody ever since.
In announcing the sentence, U.S. Attorney Machen commended the work of those who investigated the case for the Metropolitan Police Department. He also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Victim/Witness Advocate Jennifer Clark, Victim/Witness Security Specialists Michael Hailey and Debra Cannon, and Paralegal Specialist Stephanie Gilbert. Finally he expressed appreciation for the work of Assistant U.S. Attorney Robert E. Eckert, Jr., who investigated and prosecuted the case.
14-260Defendants in ATM Skimming Ring with over 5,000 Victims Sentenced to Federal PrisonRead the Press Release
ATLANTA – Michael J. Ellis has been sentenced for stealing the bank debit card numbers and passwords of individuals in Georgia and Florida through an ATM skimming device.
“This sentencing marks the end of an ATM skimming ring that victimized over 5,000 people in Georgia and Florida,” said United States Attorney Sally Quillian Yates. “Identity theft is a growing problem that damages the good names and credit of too many innocent people, and we remain committed to combatting this insidious crime in all of its various forms.”
“The Secret Service, in conjunction with our law enforcement partners, will continue to arrest those that commit crimes that prey on unsuspecting victims,” said Reginald G. Moore, Special Agent in Charge of the United States Secret Service, Atlanta Field Office. “Today’s sentence should serve as a reminder that criminals will not get away with defrauding victims and ignoring the consequences of their actions.”
According to United States Attorney Yates, the charges and other information presented in court: Ellis, working with co-defendants Zira M. Bailey and Bryan S. Kees, used illegal skimming devices to steal over $130,000 from bank customers by installing the devices at SunTrust automated teller machines (ATM’s) in Georgia and Florida. When a customer used the ATM with a skimming device installed, the device electronically recorded the customer’s debit card number and a small camera in the device video recorded the ATM keyboard as the customer entered his or her password.The defendants then downloaded the information from the device to a computer. Using a magnetic stripe card reader/writer, they re-encoded gift cards with the stolen account information. They then used the altered gift cards at ATMs to drain money from the victims’ bank accounts. Over 500 victims were linked to Bailey, Ellis, and Kees from the SunTrust ATMs.
On December 28, 2012, Bulgarian Customs officials notified the United States Secret Service in Atlanta that a DHL parcel containing illegal skimming devices was being shipped to the United States. The Secret Service obtained a federal search warrant for the package and found three skimming devices. The package was addressed to a UPS Store in Atlanta, Ga. Ellis, Bailey, and another co-conspirator, WB Wohrman, were listed as authorized recipients of mail to the UPS box. In a later search of a garage controlled by Ellis, law enforcement found 250 financial transaction cards, magnetic reader/writers, false ATM overlays, laptops with ATM videos and debit card information, and a wig.
Ellis, 36, of Decatur, Ga., was sentenced by United States District Judge Orinda D. Evans to eight years and five months in federal prison and three years of supervised release, and ordered to pay $136,374.31 in restitution.
Judge Evans previously sentenced Kees, 37, of Savannah, Ga., to seven years in federal prison, and Bailey, 27, of Picayune, Miss., to five years and five months in federal prison. Kees and Bailey were also sentenced to three years each of supervised release and $136,374.31 in restitution. All three defendants pleaded guilty to conspiracy, access device fraud, and aggravated identity theft.
In a related case, Plamen Atanasov, Stoyno Filtshev, Tsvetil Iliev, Nedyalko Palazov, and WB Wohrman were charged with using ATM skimming devices at Bank of America, JP Morgan Chase, and Wells Fargo ATMs in the metro Atlanta area. These defendants stole over $380,000 from bank customers, and over 4,700 victims were linked to this related scheme. Iliev, 34, formerly of Atlanta, Ga., is currently a fugitive, having fled the United States after his indictment with the assistance of Kees and Bailey. The other four defendants pleaded guilty to conspiracy, access device fraud, and aggravated identity theft. Judge Evans sentenced those four defendants as follows:
- Atanasov, 31, of Sandy Springs, Ga., was sentenced on April 25, 2014, to seven years in prison, three years of supervised release, and $386,951.12 in restitution.
- Filtshev, 53, of Atlanta, Ga., was sentenced on April 25, 2014, to seven years and eleven months in prison, three years of supervised release, and $386,951.12 in restitution.
- Palazov, 29, of Atlanta, Ga., was sentenced on April 25, 2014, to eight years and eleven months in prison, three years of supervised release, and $386,951.12 in restitution.
- Wohrman, 37, of Buford, Ga., sentenced on April 28, 2014, to eight years and three months in prison, three years of supervised release, and $386,951.12 in restitution.
This case was investigated by Special Agents of the United States Secret Service.
Assistant United States Attorney Stephen H. McClain prosecuted the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao/gan/.
Defendant Found Guilty in Maritime Alien Smuggling ConspiracyRead the Press Release
SAN DIEGO – A federal jury yesterday convicted San Ysidro resident Sofia Martinez, 27, of alien smuggling charges after a two week trial before the Honorable William Q. Hayes.
According to evidence presented in court, Martinez conspired with others to use jet skis and panga boats to deliver numerous undocumented aliens to the United States from Mexico. Martinez hired three Mexican citizens, whom she trained and used as jet ski drivers. She partnered with co-conspirators to purchase jet skis in the United States and bring them to Mexico for use in the conspiracy.
Martinez, who lived in Tijuana at the time, coordinated with others in the United States to pick up the illegal aliens once they were dropped off at beaches in San Diego County, and deliver them to their final destinations in the United States. Martinez and her co-conspirators charged $7,000 to $10,000 per illegal alien.
Prosecutors presented evidence of numerous smuggling events at trial, including a delivery by panga boat on May 9 and 10, 2013. The boat traveled from Rosarito, Mexico and landed south of the Children’s Pool in La Jolla, California in the early morning hours of May 10. Agents, alerted by a 911 call from a security guard and phone calls intercepted under court-ordered wiretaps, found 15 illegal aliens hiding in various locations around La Jolla.
Martinez was first indicted in September 2013 for conspiring to bring illegal aliens to the United States for financial gain. Her arrest resulted from an investigation conducted by Homeland Security Investigation’s (HSI) San Ysidro Border Enforcement Security Task Force, which is comprised of HSI special agents and Border Patrol agents.
“In addition to undermining this nation’s border security, smuggling by ocean is extremely hazardous for undocumented aliens,” said United States Attorney Laura Duffy. “Martinez’s arrest and the dismantling of this alien smuggling group is the product of countless hours of work and close coordination by numerous dedicated investigators.”
“Homeland Security Investigations invested a significant amount of resources into this investigation to reach the organizers and coordinators of the maritime smuggling events plaguing our coast,” said HSI San Diego Interim Special Agent in Charge Jose Garcia. “It was only through the hard work of the entire law enforcement team, processing numerous smuggling events and analyzing countless amounts of evidence, that they were able to develop a strong case against Sofia Martinez and her co-conspirators for a successful prosecution.”
Chief Patrol Agent Paul A. Beeson of the U.S. Border Patrol’s San Diego Sector said, “Sofia Martinez was finally caught due to the dedicated work of several law enforcement agencies who diligently worked together watching our shores. Border Patrol remains dedicated to protecting the borders of the United States, including the maritime border.”
After trial, Judge Hayes revoked Martinez’s bond and immediately remanded her into custody. Sentencing is set for February 23, 2015 at 9 a.m.
DEFENDANTS Case Number: 13CR3560-WQH Sofia Martinez Age: 27 San Ysidro, California CHARGESCount 1: Title 18, United States Code, Section 371: Conspiracy to bring in illegal aliens for financial gain. Maximum Penalty five years in prison and $250,000 fine
Counts 2-4: Title 8, United States Code, Section 1324(a)(2)(B)(ii): Bringing in illegal aliens for financial gain. Maximum Penalty: Fifteen years in prison and mandatory minimum of five years.
INVESTIGATING AGENCIESHomeland Security Investigations
Border PatrolCorporate Vice President Sentenced for Healthcare Fraud SchemeRead the Press Release
ATLANTA – Daniel K. Lane, Jr. has been sentenced for conspiring to commit healthcare fraud by filing fraudulent claims with Medicare, Blue Cross Blue Shield, and other insurers.
“This healthcare fraud scheme reached all the way up to the Vice President of Compass Healthcare,” said United States Attorney Sally Quillian Yates. “While serving as Vice President and CFO, the defendant set up the business to automatically bill insurance companies for expensive medical equipment never provided to customers, and then forged prescriptions to make the claims look legitimate. Corporate executives who engage in healthcare fraud face federal prison.”
J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office, stated: “Mr. Lane’s criminal conduct was driven by personal greed and today’s sentencing will not only hold him accountable for those actions but will serve as a reminder to others that the FBI and its law enforcement partners will identify, investigate, and present for prosecution those individuals involved in similar such activities.”
“Today’s sentence demonstrates that regardless of one’s position within a corporation, if you defraud Medicare you will be held accountable,” said Special Agent in Charge Derrick L. Jackson of the U.S. Department of Health and Human Services, Office of Inspector General, Atlanta Regional Office. “Falsifying patients’ medical files in order to generate more corporate revenue at tax payers’ expense will not be tolerated and we will vigorously pursue all such cases.”
According to United States Attorney Yates, the charges and other information presented in court: Daniel K. Lane, Jr. was the Vice President and Chief Financial Officer for Compass Healthcare, Inc., a durable medical equipment business headquartered in St. Louis, Mo., with offices in Atlanta, Ga. and other cities. Compass Healthcare specializes in providing compression stockings to patients who have been diagnosed with medical conditions such as chronic venous insufficiency and edema. Doctors may prescribe compression stockings, which come in different levels of tightness, as treatment for these conditions.
Lane’s position included the responsibility for billing insurance companies for the compression stockings that Compass Healthcare provided to individuals who were covered by insurance. He fraudulently set up the company’s billing system so that in most instances it would automatically bill the insurers for the highest compression stocking, regardless of which stocking had actually been provided to the individual, in order to generate higher payments from Medicare, Blue Cross, and other insurers. As a result, Compass Healthcare routinely “upcoded” the claims it submitted to insurers for the stockings it had provided to individuals.
Lane conspired with an Office Manager for Compass Healthcare, Holly Keisker, and others, to submit these false claims and conceal the fraudulent upcoding. Also as part of the scheme, Compass Healthcare included false diagnoses on its insurance claims to ensure payment. These false claims represented that Compass Healthcare customers had been diagnosed with various medical conditions, including chronic venous insufficiency and edema, to support the claims for high compression stockings, when in fact the customers had not been diagnosed by a doctor. Instead, Compass Healthcare used “blanket” diagnosis codes that were false to support insurance claims for compression stockings provided to customers who had no medical condition. Lane, Keisker, and others conspired to forge and alter doctors’ prescriptions so that they would support the fraudulent claims that had been submitted to insurers. They altered the prescriptions to falsely reflect that a high compression stocking had been prescribed and that the patient had been diagnosed with a medical condition. In 2011, Lane submitted altered prescriptions to Blue Cross in response to an audit conducted by the insurer.
Lane, 57, of St. Louis, Mo., was sentenced by United States District Judge Willis B. Hunt, Jr. to one year and six months in federal prison and three years of supervised release, 100 hours of community service, and ordered to pay $597,304.76 in restitution. On August 27, 2014, Lane pleaded guilty to one count of conspiracy to commit healthcare fraud.
On September 19, 2013, Keisker, 62, also of St. Louis, Mo., pleaded guilty to one count of conspiracy to commit healthcare fraud. Her sentencing is scheduled for December 10, 2014, at 10 a.m., before Judge Hunt.
This case was investigated by Special Agents of the Federal Bureau of Investigation and the U.S. Department of Health and Human Services, Office of the Inspector General.
Assistant United States Attorneys Stephen H. McClain and Jeffrey W. Davis prosecuted the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia is www.justice.gov/usao/gan.
ConvergEx Group Subsidiary Sentenced for Securities Fraud SchemeRead the Press Release
A brokerage subsidiary of ConvergEx Group LLC was sentenced and ordered to pay a criminal penalty and restitution of $26 million for wire fraud and conspiracy to commit securities and wire fraud in connection with a scheme to charge clients millions of dollars in unwarranted and hidden fees.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Assistant Director in Charge Andrew G. McCabe of the FBI’s Washington Field Office and Inspector in Charge Philip R. Bartlett of the U.S. Postal Inspection Service (USPIS) made the announcement.
“CGM Limited, a subsidiary of the global brokerage and trading firm ConvergEx, and certain executives and traders defrauded their clients by brazenly and repeatedly lying to them and then siphoning off millions of dollars through hidden fees,” said Assistant Attorney General Caldwell. “But they didn’t get away with it. Today’s sentence shows that the Justice Department will require financial companies to answer for taking advantage of their clients’ trust and violating the laws that protect investors in financial markets.”
“Today’s sentencing demonstrates that companies who hide earnings, fabricate transaction reports and provide clients with false details regarding their orders for the purpose of increasing their own bottom line will ultimately pay the price for their schemes,” said Assistant Director in Charge McCabe. “The FBI will continue to work with our partners to investigate complex international financial crimes and send a message that complete transparency is a requirement in the global trading market.”
“Today’s sentencing is an example of the dedicated work of law enforcement to stop fraud wherever it may be, safeguarding the investments of consumers and protecting the integrity of the financial markets,” said Inspector in Charge Bartlett.
ConvergEx Global Markets Limited (CGM Limited), a former broker-dealer registered in Bermuda, pleaded guilty on Dec. 18, 2013. Together with its parent company, ConvergEx Group, which entered into a deferred prosecution agreement on Dec. 18, 2013, CGM Limited will pay a criminal penalty of approximately $18.0 million, forfeit approximately $12.8 million, and will pay defrauded customers approximately $12.8 million in restitution. In total, CGM Limited and ConvergEx Group are paying $43.8 million in criminal penalties and restitution. U.S. District Judge Jose L. Linares in the District of New Jersey imposed the sentence.
As CGM Limited admitted when it pleaded guilty, certain ConvergEx Group broker-dealers that provided commission-based brokerage services regularly routed securities trading orders to CGM Limited in Bermuda so that it could take a mark-up (an additional amount paid for the purchase of a security) or mark-down (a reduction of the amount received for the sale of a security) when executing the orders. ConvergEx employees referred to such mark-ups and mark-downs as “spread,” “trading profits,” or “TP.”
To hide the increased fees, traders at CGM Limited and sales traders at ConvergEx Group subsidiaries sent false transaction reports to clients with fabricated details, including the number of shares involved in a trade, the time at which a trade was executed, and the price at which shares were purchased or sold. In total, CGM Limited took approximately $12.8 million in trading profits from these clients after it had sent the false statements to them.
CGM Limited admitted that its employees engaged in other fraudulent activities involving “spread.” As one example, CGM Limited traders violated a client’s trading instructions to allow them to take spread on the client’s trades, and then an employee of another ConvergEx Group subsidiary offered the client false explanations for the trading activity.
On Dec. 18, 2013, Jonathan Daspin, the head trader at CGM Limited, and Thomas Lekargeren, a sales trader at a different ConvergEx Group subsidiary, each pleaded guilty to conspiracy to commit securities and wire fraud.
On Aug. 6, 2014, Anthony Blumberg, the former CEO of CGM Limited, and Craig Marshall, a former trader at CGM Limited, were charged with wire fraud and conspiracy to commit securities and wire fraud. Blumberg was also charged with securities fraud. The charges in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty
As part of the deferred prosecution agreement with ConvergEx Group, the department highlighted ConvergEx Group’s extensive cooperation, including its robust internal investigation, and as well as its extensive remediation and enhanced compliance program and internal controls.
The case was investigated by the FBI’s Washington Field Office and the Washington, D.C. and New York offices of the USPIS. The case is being prosecuted by Trial Attorneys Justin Goodyear, Jason Linder and Patrick Pericak of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Leslie Schwartz of the District of New Jersey. Fraud Section Assistant Chief Robert Zink also assisted with the investigation.
The SEC referred the matter to the Justice Department for investigation, and the department expresses its appreciation for the substantial assistance provided by the SEC.
China Spring Man Sentenced to Federal Prison for Waco Bank RobberyRead the Press Release
In Waco today, 51-year-old Milton Lewis Anglin of China Spring, TX, was sentenced to 51 months in federal prison for bank robbery announced United States Attorney Robert Pitman and Christopher Combs, Federal Bureau of Investigation Special Agent in Charge of the San Antonio Division.
In addition to the prison term, United States District Judge Walter S. Smith, Jr. ordered that Anglin pay a $1,000 fine and be placed on supervised release for a period of five years after completing his prison term.
On September 18, 2014, Anglin pleaded guilty to a bank robbery charge admitting that he robbed the First National Bank of Central Texas located on China Spring Road in Waco with a dangerous weapon on January 31, 2014. During the heist, Anglin stole approximately $2,832 from the financial institution. Authorities arrested Anglin on February 3, 2014. He has remained in federal custody since.
This case was investigated by the Federal Bureau of Investigation together with the Waco Police Department. Assistant United States Attorney Greg Gloff prosecuted this case on behalf of the Government.
Chicago Police Officer Indicted for Alleged Civil Rights Excessive Force Violation and Obstruction of JusticeRead the Press Release
CHICAGO ― A Chicago Police officer was indicted on federal civil rights and obstruction charges alleging that he used excessive force by punching and kicking a victim and then lied in a police report to cover up the incident in 2012, federal law enforcement officials announced today. The defendant, ALDO BROWN, was indicted on one count of violating the unnamed victim’s civil rights to be free from unlawful seizures and the use of unreasonable force by a law enforcement officer and two counts of obstruction of justice.
Brown, 37, joined the Chicago Police Department in December 2002. He will be arraigned on a date yet to be scheduled in U.S. District Court.
The three-count indictment was returned by a federal grand jury yesterday and was announced today by Zachary T. Fardon, United States Attorney for the Northern District of Illinois, and Robert J. Holley, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation. The Independent Police Review Authority cooperated with and assisted in the investigation.
According to the indictment, on Sept. 27, 2012, Brown and Officer A entered a convenience store located on East 76th Street in Chicago. When they arrived, the officers placed certain individuals inside the store in handcuffs, including Victim A. Brown and Officer A then began searching the store and the individuals inside. Shortly after Officer A removed the handcuffs from Victim A, Brown allegedly struck Victim A multiple times, resulting in bodily injury.
While Victim A was lying face down on the floor of the store, again in handcuffs, Brown recovered a firearm from Victim A’s rear pants pocket. Then, while Victim A was still handcuffed and lying face down, Brown allegedly kicked Victim A. Brown and Officer A then arrested Victim A.
One obstruction of justice count alleges that Brown made false statements in a tactical response report, including that Victim A was an “active resister,” who “fled” and “pulled away,” but the report did not indicate that Brown punched or kicked Victim A. Brown allegedly knew that Victim A did not actively resist, attempt to flee the situation, or pull away, and Brown knew that he punched and kicked Victim A.
The second obstruction count alleges that Brown lied in an arrest report, which falsely stated, in part, that:
P.O. Brown approached the above subject to conduct a field interview at which time the above subject stated to P.O. Brown, “I got some weed on me” and reached toward his rear pants pocket at which time P.O. Brown observed a handgun inside the above subject rear pants pocket. P.O. Brown conducted a emergency take down for officer safety and recovered the gun from the above subject rear pants pocket. The above subject was trying to pull away from P.O. Brown at which time P.O. Brown delivered a open hand stun to gain control of the above subject…
Brown allegedly knew the arrest report was false for multiple reasons, including that he did not observe a firearm on Victim A at the time of a field interview; he did not know that Victim A had a firearm in his possession until after he struck Victim A multiple times, handcuffed him for a second time, and Victim A was lying on the floor of the convenience store; and Victim A did not pull away from him as the arrest report indicated.
The civil rights count carries a maximum sentence of 10 years in prison, and each count of obstruction of justice carries a maximum of 20 years in prison, and there is a $250,000 maximum fine on all three counts. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines.
The government is being represented by Assistant U.S. Attorney Nancy DePodesta.
An indictment contains merely charges and is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Indictment
Chicago Businessman Sentenced for Failing to File Tax ReturnsRead the Press Release
A prominent Chicago businessman was sentenced today to serve six months in prison and six months home confinement, to be followed by one year supervised release and ordered to cooperate in paying taxes owed to the Internal Revenue Service (IRS) for willfully failing to file federal individual income tax returns, announced the Justice Department.
On June 12, a criminal information filed in the U.S. District Court for the Northern District of Illinois in Chicago alleged that Jamie Viteri had willfully failed to file individual income tax returns for tax years 2007, 2008 and 2009. According to the plea agreement, Viteri earned substantial income that he did not report to the IRS from a company and a state agency. Viteri’s gross income exceeded $270,000 in 2008 and $290,000 in 2009. He was the president and chief executive officer of Viteri Inc., doing business as Chicago Latino Network (CLN), a solely owned media company focused on the Latino community in Chicago. Viteri was also an employee and managing director of the Bureau of Entrepreneurship and Small Business at the Department of Commerce and Economic Opportunity, an Illinois state government agency.
The case was investigated by special agents from IRS-Criminal Investigation and prosecuted by Trial Attorney Christopher Maietta of the Justice Department’s Tax Division.
Charleroi Felon Charged with Illegally Possessing Multiple FirearmsRead the Press Release
PITTSBURGH - A Washington County felon has been indicted by a federal grand jury in Pittsburgh on a charge of possession of a firearm by a convicted felon, United States Attorney David J. Hickton announced today.
The one-count indictment, returned on Nov. 18, named William Garry Snowden, 47, as the sole defendant.
According to the indictment, on or about Oct. 29, 2014, Snowden, who has previously been convicted of aggravated assault and kidnapping, was found to be in possession of multiple firearms. Federal law prohibits an individual who has been convicted of a felony from possessing a firearm.
The law provides for a maximum total sentence of 10 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history of the defendant. The defendant was arrested on October 29, 2014, and has been detained since that date.
Assistant United States Attorney Cindy K. Chung is prosecuting this case on behalf of the government.
This case is being prosecuted under Project Safe Neighborhoods, a collaborative effort by federal, state, and local law enforcement agencies, prosecutors, and communities to prevent, deter, and prosecute gun crimes. The Bureau of Alcohol, Tobacco, Firearms and Explosives conducted the investigation leading to the Indictment in this case.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.