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Thursday 13 November 2014
New Haven Drug Dealer Sentenced to More Than 5 Years in Federal PrisonRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that ANTHONY MOORE, also known as “Freak,” 33, of New Haven, was sentenced yesterday by U.S. District Judge Robert N. Chatigny in Hartford to 63 months of imprisonment, followed by four years of supervised release, for distributing crack and powder cocaine.
According to court documents and statements made in court, this matter stems from “Operation Bloodline,” a joint law enforcement investigation targeting narcotics trafficking and gang violence in the Dwight-Kensington and Fair Haven sections of New Haven. Led by the DEA New Haven Task Force and the New Haven and Hamden Police Departments, the year-long investigation included the use of court-authorized wiretaps on numerous telephones, extensive physical surveillance, controlled purchases of narcotics, execution of search warrants, and seizures of narcotics and firearms. More than 100 individuals were charged as a result of the investigation.
MOORE was arrested on May 22, 2012, and is detained. On December 10, 2013, he pleaded guilty to one count of conspiracy to possess with intent to distribute, and to distribute, 28 grams or more of cocaine base (“crack cocaine”).
MOORE’s criminal history includes three prior felony drug convictions.
This matter was investigated by the Drug Enforcement Administration’s New Haven Task Force, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the New Haven, Hamden, West Haven, North Haven, Branford, Ansonia and Meriden Police Departments. The United States Marshals Service, the Connecticut State Police, the Connecticut Department of Correction, Parole and Community Services and the Milford, Hartford, New Britain, North Branford and Stratford Police Departments provided valuable assistance to the investigation.
This case is being prosecuted by Assistant U.S. Attorneys S. Dave Vatti and Marc Silverman.
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[email protected]Native of El Salvador Charged with Illegal ReentryRead the Press Release
Carlos I. Cruz-Aguilar, a/k/a “Carlos I. Cruz,” 42, of Philadelphia, PA, was charged today by Indictment with illegal reentry after deportation, announced United States Attorney Zane David Memeger. The indictment alleges that on or about February 7, 2014, Cruz-Aguilar, an alien, and native and citizen of El Salvador, was found in the United States after having been deported from the United States on or about September 22, 2004.
If convicted the defendant faces a maximum possible sentence of 20 years.
The case was investigated by Immigration and Customs Enforcement, Enforcement and Removal Operations (“ERO”), and is being prosecuted by Assistant United States Attorney Terri Marinari.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Click here to view the indictment.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Monessen Man Sentenced to Probation with Home Detention for $50K Fraud SchemeRead the Press Release
PITTSBURGH - A resident of Westmoreland County was sentenced yesterday in federal court to three years probation and six months home detention on his conviction of conspiracy, United States Attorney David J. Hickton announced today.
United States District Judge Gustave Diamond imposed the sentence on William Thomas Holiday, III, 27, of Monessen, Pennsylvania.
According to the information presented to the court, in 2012 Holiday and others used victim identities to obtain unauthorized Discover credit cards which were later used to purchase merchandise at department stores, or to obtain cash at ATMs in Western Pennsylvania. Losses from the conspiracy exceeded $50,000.
Assistant United States Attorney Gregory C. Melucci prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Western Pennsylvania Financial Crimes Task Force for conducting the investigation that led to the successful prosecution of Holiday. The WPFCTF was established as a collaborative, multi-agency effort to effectively combat financial crimes, including identity fraud, in Western Pennsylvania. Partnering in this effort are the United States Attorney's Office, the United States Secret Service, the United States Postal Inspection Service, the Department of Homeland Security, the Allegheny County District Attorney's Office, the Allegheny County Police Department, the City of Pittsburgh Bureau of Police and the Pennsylvania State Police.
Missouri Man Sentenced to 13 YearsFor Robbing Bank in Shawnee, Kan.Read the Press Release
KANSAS CITY, KAN. - A Missouri man was sentenced Wednesday to 13 years and a month in federal prison for a robbery at a bank in Shawnee, Kan., U.S. Attorney Barry Grissom said.
Scott Thario, 22, Lee’s Summit, Mo., pleaded guilty to one count of bank robbery and one count of unlawful possession of a firearm in furtherance of a crime of violence.
A grand jury indictment filed in December 2013 alleged that on Dec. 16, 2013, Thario robbed Intrust Bank at 19501 West 65th Terrace in Shawnee, Kan. The indictment alleged he was carrying a short-barreled shotgun during the robbery.
Grissom commended the Shawnee Police Department, the FBI and Assistant U.S. Attorney David Zabel for their work on the case.
Member of Organized Cybercrime Ring Responsible for $50 Million in Online Identity Theft Sentenced to 115 Months in PrisonRead the Press Release
A Georgia man who purchased stolen credit card data and other personal information through the identity theft and credit card fraud ring known as “Carder.su” was sentenced today to serve 115 months in federal prison. He was further ordered to pay $50.8 million in restitution.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Daniel G. Bogden of the District of Nevada and Assistant Special Agent in Charge Michael Harris of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE HSI) in Las Vegas made the announcement. U.S. District Judge Andrew P. Gordon of the District of Nevada imposed the sentence.
“Cyber thieves created a real criminal organization through the virtual world of the Internet, stealing credit card data and relying on technology, perceived anonymity, and international borders to evade law enforcement,” said Assistant Attorney General Caldwell. “Cameron Harrison made a living by using that stolen financial information.. Applying time-honored techniques from mob and gang prosecutions to this new generation of cybercriminals, we were able to infiltrate and bring down the Carder.su ring.”
“The financial toll exacted by identity theft and credit card fraud can be crippling to victims both financially and emotionally,” said U.S. Attorney Bogden. “These are far from victimless crimes and the members of this organization were responsible for the theft of over $50 million. We are working diligently with our law enforcement partners to ensure that the people who commit these high-tech crimes are put out of business.”
“This significant sentence is entirely fitting given that this defendant’s actions and those of the larger criminal organization harmed countless innocent Americans and seriously compromised our financial system,” said Homeland Security Investigations Executive Associate Director Peter T. Edge. “Criminals like this defendant who believe they can elude detection by hiding behind their computer screens here and overseas are discovering that cyberspace affords no refuge from American justice. HSI will continue to work closely with its law enforcement partners to track down these violators and see that they face the full weight of the law.”
Cameron Harrison, aka “Kilobit,” 28, of Augusta, Georgia, admitted at his guilty plea hearing that he became associated with the Carder.su organization in June 2008. According to Harrison’s admissions, Carder.su was an Internet-based, international criminal enterprise whose members trafficked in compromised credit card account data and counterfeit identifications and committed money laundering, narcotics trafficking and computer crimes. Harrison admitted that the group tried to protect the anonymity and the security of the enterprise from both rival organizations and law enforcement. For example, members communicated through various secure and encypted forums, such as chatrooms, private messaging systems, encrypted email, proxies and encypted virtual private networks. Gaining membership in the group required the recommendation of two current members in good standing.
Harrison admitted that he purchased compromised credit card account data and other personal identifying information from fellow Carder.su members. He further admitted to possessing over 260 compromised credit and debit card numbers, which were recovered from his computer and email accounts following his arrest.
Harrison was identified when he purchased a counterfeit Georgia driver’s license from an undercover special agent through the Carder.su network. During interactions with the undercover special agent, Harrison admitted to having been a vendor of counterfeit identifications in the defunct cyberfraud organization “ShadowCrew.”
Fifty-five individuals were charged in four separate indictments in Operation Open Market, which targeted the Carder.su organization. To date, 26 individuals have been convicted and the rest are either fugitives or are pending trial. Harrison pleaded guilty in April 2014 to participating in a racketeer influenced corrupt organization, conspiracy to engage in a racketeer influenced and corrupt organization, and trafficking in and production of false identification documents.
The cases were investigated by HSI and the U.S. Secret Service, and are being prosecuted by Trial Attorney Jonathan Ophardt of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorneys Kimberly M. Frayn and Andrew W. Duncan of the District of Nevada.
This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes. For more information about the task force visit: www.stopfraud.gov/.
Mechanicville Man Pleads Guilty to Production of Child PornographyRead the Press Release
ALBANY, NEW YORK – ROBERT V. MCLAUGHLIN, age 57, of Mechanicville, New York, pled guilty today in Albany before United States District Judge Mae A. D’Agostino to two counts of production of child pornography, announced United States Attorney Richard S. Hartunian and Andrew W. Vale, Special Agent in Charge of the Albany Division of the Federal Bureau of Investigation.
McLAUGHLIN faces at least15 years and up to 30 years of imprisonment on each count, as well as term of supervised release of at least 5 years and up to life. He also faces a maximum fine of $250,000 and mandatory registration as a sex offender. McLAUGHLIN will be sentenced in Albany, New York on March 12, 2015.
As part of his guilty plea, McLAUGHLIN admitted that between 2012 and 2014 he engaged in sexually explicit conduct with two young girls for the purpose of producing visual depictions of that abuse, and that he produced such depictions.
This case was investigated by the New York State Police and the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Lisa M. Fletcher and Special Assistant United States Attorney Amanda W. Cox.
Mcdowell County Woman Pleads Guilty in Federal Court to Filing Fraudulent Water Quality ReportsRead the Press Release
CHARLESTON, W.Va. – United States Attorney Booth Goodwin announced that Bonita Witt-Hird, 60, of Thorpe (McDowell County) West Virginia, pled guilty today in federal court in Charleston to filing fraudulent water quality reports.
Witt-Hird was formerly employed as the office manager for Richmorr Associates, Inc., an environmental engineering firm in Elkview, West Virginia. Richmorr provides water sampling services to wastewater treatment plants throughout West Virginia. Wastewater plants are required by state and federal law to sample wastewater discharges. The results are submitted to the West Virginia Department of Environmental Protection (WVDEP). WVDEP reviews the results to ensure compliance with water quality standards. In the event of non-compliance, WVDEP may levy fines or, in extreme cases, shut down the wastewater treatment plant.From April of 2012 to June of 2013, Witt-Hird filed approximately 80 false reports with the WVDEP. These false reports made it appear that current water quality sampling had been performed for the wastewater plants when, in fact, the test results had been copied from previous years.
Witt-Hird previously plead guilty on September 26, 2013 to obstructing an IRS investigation and is currently imprisoned on the sentence imposed for that offense. For the fraudulent water quality report offense, Witt-Hird faces a maximum penalty of two years imprisonment, and a fine of up to $250,000. She is scheduled to be sentenced on January 5, 2015.
The investigation was conducted by the Environmental Protection Agency, Criminal Investigation Division, the WVDEP and the Federal Bureau of Investigation. Assistant United States Attorney Erik S. Goes is in charge of the prosecution.
McLaughlin Woman Charged with Assault Resulting in Serious Bodily Injury to A ChildRead the Press Release
United States Attorney Brendan V. Johnson announced that a McLaughlin, South Dakota, woman has been indicted by a federal grand jury for Assault Resulting in Serious Bodily Injury to a Child.
Makayla Kills In Water, age 20, was indicted on October 15, 2014. She appeared before U.S. Magistrate Judge William D. Gerdes on November 6, 2014, and pled not guilty to the Indictment. The maximum penalty upon conviction is up to life in custody and/or a $250,000 fine, 5 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on or about September 20, 2014, Kills In Water unlawfully assaulted a child who had not attained the age of 18 years old, and said assault resulted in serious bodily injury.
The charge is merely an accusation and Kills In Water is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Federal Bureau of Investigation. Assistant U.S. Attorney Troy R. Morley is prosecuting the case.
Kills In Water was released on bond. A trial date has been set for December 2, 2014.
Many Resident Pleads Guilty to Possession with Intent to Distribute Cocaine BaseRead the Press Release
SHREVEPORT, La. –United States Attorney Stephanie A. Finley announced today that a Many resident pleaded guilty to possession with intent to distribute crack cocaine in Sabine Parish.
Cassius L. Medlock, 32, of Many, La., pleaded guilty before U.S. District Judge Elizabeth E. Foote, to one count of possession with intent to distribute cocaine base. Medlock was stopped on August 14, 2014, for speeding and after searching the vehicle, officers observed more than 193 grams of cocaine base and marijuana in the vehicle he was driving. Six children were also present in the vehicle.Medlock faces five to 40 years in prison, four to five years of supervised release and a $5 million fine. A sentencing date of March 5, 2015 was set.
The DEA and the Sabine Parish Sheriff’s Office investigated the case. Assistant U.S. Attorney Seth Reeg is prosecuting the case.
Man who Operated Reno Consulting Firm Pleads Guilty to Failure to Pay $100,000 in Employment Taxes to IRSRead the Press Release
RENO, Nev. – Michael Stickler, 54, of Reno, pleaded guilty today before U.S. District Judge Larry R. Hicks to one count of willful failure to collect or pay employment and Federal Insurance Contribution Act (FICA) taxes to the IRS, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.
According to Stickler’s plea agreement, he owned and operated a company in Reno called Faith Based Solutions from 1999 to 2009. Stickler collected and withheld employment and FICA taxes from his employees’ wages, but failed to pay them over to the IRS. Stickler pleaded guilty to failing to pay $17,389.25 in employment and FICA taxes for the fourth quarter of tax year 2007, but the plea agreement states that Stickler also admitted to willfully failing to pay over employment and FICA taxes to the IRS for other periods during the tax years 2006 through 2010, and that the total tax loss that can be used for sentencing purposes is $100,899.90.
In a separately filed federal case, Stickler was convicted by a jury on March 24 of theft of public money. The evidence presented to the jury in that case was that in 2007, Stickler’s company, Faith Based Solutions, received $500,000 in federal grant money to teach non-profit organizations how to apply for federal government grants. Stickler drew down all of the grant funds in the first seven months of the grant period, and instead of distributing the money to sub-grantees, he put it in accounts that he controlled and used it to pay large salaries to himself and family members, to take elaborate vacations, and for other items that were not approved by the grant.Sentencing in both cases will be on Feb. 9, 2015, at 9:00 a.m. before U.S. District Judge Miranda M. Du.
The cases were investigated by IRS Criminal Investigation and the U.S. Department of Health and Human Services Office of Inspector General. They are being prosecuted by Assistant U.S. Attorney Carla B. Higginbotham.Los Altos Investment Manager Indicted for Securities and Mail FraudRead the Press Release
SAN JOSE – A federal grand jury in San Jose returned a twenty-nine count indictment charging a Los Altos investment manager with securities and mail fraud, relating to a multi-million dollar investment scheme, announced United States Attorney Melinda Haag, FBI Special Agent in Charge David J. Johnson, and Special Agent in Charge Kari Overson, Small Business Administration’s Office of Inspector General.
According to the indictment, which was unsealed yesterday, Mark Feathers is named as the sole defendant in all counts, including 17 counts of securities fraud and 12 counts of mail fraud between 2009 and 2012.
The indictment alleges that Feathers, 51, of Los Altos, Calif. was the founder, CEO, and a director of Small Business Capital Corporation (SBCC), a privately-held California corporation formed in 2004 with its principal place of business in Los Altos. SBCC was the sole manager of three investment funds that were marketed as investing in loans secured by first deeds of trust on commercial and income-producing residential real estate.
According to the indictment, Feathers, raised more than $50 million from over 250 investors through the offer and sale of securities in the form of membership interests in investment funds. The defendant and SBCC represented to prospective investors that the investment funds would pay “Member Returns” of at least 7.5% from profits generated by the investment funds' mortgage loan portfolios. However, by June 2012, as a result of his fraudulent scheme, Feathers had allegedly booked over $5 million in unsecured loans from the investments funds to his management company, paid returns to investors in excess of net profits of the investment funds, a “Ponzi” scheme in which the returns were partially funded with money from new investors, and in the process, diverted approximately $2 million to his own personal benefit.
According to the indictment, despite owing a fiduciary duty to the investment funds’ investors, the defendant failed to disclose significant conflicts of interest arising from causing the investment funds to transfer over $7 million to SBCC so it could pay its expenses, and recording a majority these transfers as assets of the investment funds. In addition, the defendant sent regular newsletters to investors reassuring them that the funds were making loans secured by first and second deeds of trust and that all loans were performing. However, as alleged in the indictment, the investment funds had unsecured loans to SBCC, these loans were not generating returns, and the investment funds themselves were not generating returns as represented in the Offering Documents or the subsequent account statements transmitted to investors.
The defendant made his initial appearance in federal court in San Jose yesterday before the Honorable Judge Paul S. Grewal, United States Magistrate Court Judge, who unsealed the indictment. The defendant was released on a $250,000 bond and subject to various terms and conditions. His next scheduled appearance is on Wednesday, Nov. 19, 2014, at 1:30 p.m., for status and further setting before Judge Grewal in San Jose.
The maximum statutory penalty for each count of securities fraud is thirty years imprisonment, a fine of $1,000,000 or twice the amount of gain or loss, whichever is greater, five years of supervised release, and restitution if appropriate. The maximum statutory penalty for each count of mail fraud is twenty years imprisonment, a fine of $250,000 or twice the amount of gain or loss, whichever is greater, and restitution if appropriate. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Timothy J. Lucey is the Assistant United States Attorney who is prosecuting the case with the assistance of Laurie Worthen. The prosecution is the result of an investigation by the FBI in coordination from the Small Business Administration’s Office of Inspector General and with substantial assistance from the Securities Exchange Commission’s Los Angeles Regional Office.
(Feathers indictment )
Loomis Armored Transport Drivers Arrested in Plot to Steal More Than $1 Million Being Transported for Federally Insured BankRead the Press Release
LOS ANGELES – Two armored truck drivers for Loomis were arrested this morning on federal charges related to a scheme in which they stole more than $1 million in cash, part of a shipment that was being transported for Bank of America
Cesar Yanez, 37, of Fontana, and Aldo Esquivel Vega, 28, of Pomona, were arrested this morning without incident by special agents with the FBI and officers with the Los Angeles Police Department. In relation to search warrants executed this morning, agents found approximately $85,000 in cash at the home of Yanez.
A third person involved in the scheme, Jovita Medina Guzman, 39, of San Bernardino, was also arrested this morning for helping her co-defendants hide and disperse the stolen funds and for being an accessory after the fact.
All three defendants are expected to be arraigned on a four-count indictment this afternoon in United States District Court.
The indictment, which was returned by a federal grand jury on November 7 and unsealed this morning, alleges that Yanez and Vega, while employed by Loomis on June 27, were transporting a multi-million dollar shipment of cash for Bank of America when they stopped in a parking lot on West Adams Boulevard. Vega electronically opened the rear doors of the armored car, which allowed Yanez to access the cash storage area of the vehicle. Yanez removed $1,086,000 in cash from the armored car and placed it into a trash can that had been left in the parking by an as-yet-unidentified person, who later picked up the trash can and recovered the stolen money. Later, Guzman allegedly delivered some of the stolen money to Vega.
Yanez and Vega are each charged with conspiracy to commit bank larceny and bank larceny. Additionally, Yanez and Guzman are charged with Possession of Bank Larceny Proceeds, and Guzman is charged as an accessory after the fact to hinder and prevent her co-defendants’ apprehension, trial, and punishment.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until proven guilty in court.
If they are convicted of the offenses alleged in the indictment, Yanez would face a statutory maximum sentence of 25 years in federal prison; Vega would face up to 15 years; and Guzman could be sentenced to as much as 15 years in custody. Additionally, each of the defendants could be ordered to pay fines of as much as two times the loss suffered by Bank of America.
The investigation into the theft of bank funds was conducted by the Federal Bureau of Investigation and the Los Angeles Police Department.
Release No. 14-151
Leader of Drug Distribution Network Sentenced to 108 Months in PrisonRead the Press Release
1125 Chapline Street, Federal Building, Suite 3000 ● Wheeling, WV 26003
(304) 234-0100 ● Contact: Tara Tighe, Public Affairs SpecialistWHEELING, WEST VIRGINIA – Richard L. Baron, 52, of Triadelphia, West Virginia, the leader of a prescription painkiller, heroin, and cocaine distribution network, was sentenced to 108 months in prison, United States Attorney William J. Ihlenfeld, II, announced today.
Sophisticated surveillance techniques employed by U.S. Drug Enforcement Administration and the Ohio Valley Drug and Violent Crime Task Force, a HIDTA-funded initiative, revealed that large quantities of prescription pills were obtained from Columbus, Ohio, Baltimore, Maryland, Detroit, Michigan, and California. Baron then orchestrated a complex collection of associates to redistribute the drugs. The distribution network focused primarily on prescription pills, but also involved heroin and cocaine.
Baron, also known as "Unc" or "Class,” admitted his role is distributing oxycodone, heroin, and cocaine when he pled guilty in October 2012 to one count of "Conspiracy to Distribute Schedule I and II Controlled Substances." As part of his sentence, Baron will also forfeit more than $10,0000.00. The 108 month sentence will be served consecutive to a twelve month sentence imposed in a supervised release revocation hearing.
Additionally, Douglas Lee Saunders, 55, of Columbus, Ohio, was sentenced to five years of probation. Saunders supplied the distribution network with at least 297 oxycodone pills.
Twenty-two others were convicted as part of the Baron case, including Robert Paige Patterson, Samneisha Walker, Letitia Kadija Tambi, Deandre Scott Estelle, Edward Barry Davis, Robin E. Rusk, Brian Nicholas Barber, Gary Jospeh Hack, Elliot Ross Fitzsimmons, Chelsea Aleece Radcliffe, Thomas James Kunik, Ashlie Noel Taylor, Jenny E. Kota, Richard Fischer, Kevin R. Mills, James Nathan Barcus, Jonathan Allen Wildey, Reuben Jule Rouse, Teo Marcero Coleman, Jarrett James Robinson, Richard Edward Lang, Jr., and Craig A. Booker.
Assistant U.S. Attorney Randy Bernard prosecuted the cases on behalf of the government.
Chief U.S. District Judge John Preston Bailey presided.
Lawyer Sentenced in Manhattan Federal Court to Five Years in Prison in Connection with Leadership of Asylum Fraud RingRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that FENG LING LIU, a/k/a Karen, the attorney and owner of law firms in the Chinatown neighborhood of Manhattan, was sentenced in Manhattan federal court to five years in prison for her leadership of an immigration fraud conspiracy. Following a four-week trial in March and April 2014, a jury convicted LIU of participating in a conspiracy to commit immigration fraud between approximately 2007 and approximately 2012. LIU was sentenced yesterday by United States District Judge Ronnie Abrams.
Manhattan U.S. Attorney Preet Bharara said: “I would like to thank our law enforcement partners at the Federal Bureau of Investigation and U.S. Citizenship and Immigration Services for their hard work on this case.”
According to the Indictment filed in Manhattan federal court, public court filings, and the evidence admitted at trial:
LIU, a lawyer, operated two law firms – the Law Offices of Feng Ling Liu and Moslemi and Associates, Inc. – both of which assisted aliens from China in obtaining asylum status through fraud. LIU and her employees profited by creating and submitting asylum applications containing false stories of persecution purportedly suffered by alien applicants. LIU and her employees coached applicants to lie to immigration authorities and assisted applicants in obtaining and/or creating false documentation to support the fraudulent claims. In total, the two law firms filed thousands of fraudulent applications and earned tens of millions of dollars from their fraud.
In addition to the prison term, LIU, 48, of New York, New York, was ordered to pay a $12,500 fine and a $100 special assessment fee, and to forfeit $7,245,000.
Mr. Bharara praised the investigative work of the Federal Bureau of Investigation, and thanked the New York Asylum Office of the Department of Homeland Security, U.S. Citizenship and Immigration Services.
The case is being handled by the Office’s Organized Crime Unit. Assistant U.S. Attorneys Rebecca Mermelstein, Patrick Egan, and Robert Boone are in charge of the prosecution. Assistant U.S. Attorney Andrew Adams is in charge of the forfeiture.
Lantry Man Sentenced for Simple Assault of A MinorRead the Press Release
United States Attorney Brendan V. Johnson announced that a Lantry, South Dakota, man convicted of Simple Assault of a Minor, was sentenced on November 12, 2014, by U.S. Magistrate Judge Mark A. Moreno.
Robert Smith, age 53, was sentenced to 3 months in custody, 1 year of supervised release, and a $25 special assessment to the Federal Crime Victims Fund.
Smith was indicted for Sexual Contact with a Minor by a federal grand jury on September 17, 2013. He pled guilty to Simple Assault of a Minor on September 2, 2014.
The conviction arose from an incident that occurred between May 30 and July 27, 2012, near Lantry, when the victim, a minor between the ages of 12 and 16 years old, was at Smith’s home. At the time, Smith engaged in intentional, offensive touching of the victim and committed a simple assault on the victim.
This case was investigated by the Federal Bureau of Investigation, the South Dakota Department of Social Services, and the Cheyenne River Sioux Tribe Law Enforcement Division. Assistant U.S. Attorney Mikal Hanson prosecuted the case.
Smith was ordered to report to the U.S. Marshals Service on January 2, 2015, to begin serving his sentence.
La Vista Man Sentenced for Making False Statements in an Application for a Position with the United States Air Force Weather ServiceRead the Press Release
United States Attorney Deborah R. Gilg announced today that Franklin Ansu, age 31 of La Vista, Nebraska, was sentenced for his conviction for making false statements in an application for a position with the United States Air Force Weather Agency. Senior United States Judge Lyle E. Strom sentenced Ansu to three years of probation and ordered him to pay a fine in the amount of $1,000. Ansu was further ordered to perform 120 hours of community service while on probation.
Ansu, a naturalized United States citizen, served in the United States Air Force. After his discharge from the Air Force, he obtained a civilian position with the United States Air Force Weather Agency at Offutt Air Force Base. Ansu completed a required SF-86 Questionnaire form for each position which described his background and prior work experience. His answers on the questionnaires omitted any reference to Ansu’s prior employment with the Ghana Bureau of National Investigations. Ansu resigned his position with the weather agency after criminal charges were filed against him.
This case was investigated by the Federal Bureau of Investigation and the Air Force Office of Special Investigations.
Kittery Man Sentenced to over 3 Years in Prison for Providing False Document to Probation Officer and Violating Release ConditionsRead the Press Release
Contact: Craig M. Wolff
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced that
Michael Rock, 54, of Kittery, Maine, was sentenced today in U.S. District Court by Judge D.
Brock Hornby to 39 months in prison, consisting of 27 months for violating conditions of
supervised release and an additional 12 months for providing a false document to his federal
probation officer. Rock was also sentenced to three years of supervised release following his
release from prison. Rock pleaded guilty to the charges on May 8, 2014.According to court records, in November 2013, Rock was on federal supervised release
following a conviction in the District of Maine for providing false information in a credit
application. He had previously been convicted twice in this district for mail fraud. As a result of
his convictions, he owed over $60,000 in restitution to his victims. As part of his supervised
release, Rock was required to answer truthfully all inquiries by his probation officer and provide
the officer with any requested financial information. After Rock’s probation officer received
information leading her to suspect that he had violated his release conditions, she instructed him
to complete a financial disclosure form. On the form, Rock failed to disclose a bank account
through which he conducted most of his financial activity. The officer’s investigation also
revealed that Rock failed to disclose that he was paying rent for a second residence in York in
addition to the residence in Kittery that he disclosed.The investigation was conducted by the U.S. Probation Office.
Jorge Gutierrez-sanchez Sentenced for Illegal Use of Social Security NumbersRead the Press Release
U.S. Attorney Kenneth A. Polite announced that JORGE GUTIERREZ-SANCHEZ, a/k/a Frank Farias, a/k/a Eusebio Ramirez, Jr., a/k/a Erick S. Couvertier-Rivera, age 29, a Mexican citizen, was sentenced today for falsely representing two different social security numbers in order to obtain training for employment.
U.S. District Judge Nannette Jolivette Brown sentenced GUTIERREZ-SANCHEZ to six months imprisonment, followed by one year of supervised release.
According to court documents, on May 6, 2014, GUTIERREZ-SANCHEZ was hired by Insulations Inc., a company located in Harahan, Louisiana, using the name Erick Steven Couvertier-Rivera, with the Social Security number XXX-XX-6526. GUTIERREZ-SANCHEZ completed the I-9 form claiming U.S. citizenship, as well as W-4 form, using a driver’s license with his own photo in Couvertier-Rivera’s name and Social Security number.
On May 7, 2014, prior to Insulations Inc. sending GUTIERREZ-SANCHEZ to work at Mississippi Power Company, he attended training at Gulf Coast Safety Council (“GCSC”), located in St. Charles Parish in the Eastern District of Louisiana. In order to get into GCSC’s training, GUTIERREZ-SANCHEZ presented that same driver’s license and Social Security number in Couvertier-Rivera’s name.
This was not the first time GUTIERREZ-SANCHEZ had attended a GCSC training. On January 31, 2014, GUTIERREZ-SANCHEZ went to employment training at GCSC and presented GCSC personnel with a driver’s license with his photo, but in the name Frank Farias and gave GCSC a Social Security card in Frank Farias’s name with the number XXX-XX-7281. The same day GUTIERREZ-SANCHEZ was posing as Frank Farias, another individual went to GCSC for employment training and presented himself as Eusebio Ramirez, Jr. with a Social Security card with the number XXX-XX-4930 in the name of Eusebio Ramirez, Jr. and a driver’s license in the name of Eusebio Ramirez, Jr., but with GUTIERREZ-SANCHEZ’s picture on it. GUTIERREZ-SANCHEZ had previously used the identity of Eusebio Ramirez, Jr., including the driver’s license and social security card presented to GCSC on January 31, 2014, to gain employment.
U.S. Attorney Polite praised the work of the Bureau of Immigration and Customs Enforcement in investigating this matter. Assistant United States Attorney Emily K. Greenfield prosecuted the case.
Indictment in U.S. V. Irving Rubin, Et Al.Read the Press Release
U.S. v. Irving Rubin, et al. Indictment
Illegal Alien Sentenced to over Years in Prison for Aggravated Identity TheftRead the Press Release
An illegal alien from Mexico who assumed the identity of a United States citizen was sentenced today to more than two years in federal prison.
Juan Bautista-Rubio, age 22, an illegal alien from Mexico living in Cedar Falls, Iowa, received the prison term after a July 9, 2014, jury verdict finding him guilty of one count of aggravated identity theft. Bautista-Rubio previously pled guilty on May 9, 2014, to one count of illegal re-entry into the United States following deportation and one count of unlawful use of a fraudulently acquired social security card and permanent resident card to gain employment in the United States.
The evidence at trial showed that Bautista-Rubio used a fraudulently acquired social security card and a fake lawful permanent resident alien card to obtain employment in Waterloo, Iowa, where he filled out an Immigration I-9 Form on April 5, 2012, falsely claiming to be a lawful permanent resident alien. Immigration I-9 forms are required to be completed by all employees working within the United States. Bautista-Rubio worked in Waterloo, Iowa, continuously from April 2012 through June 2013 and again from December 2013 through April 2014.
On April 23, 2014, Bautista-Rubio was questioned by an agent with Homeland Security Investigations. During that interview Bautista-Rubio admitted that he was present in United States illegally after being deported in 2011 and that he knowingly used the identification documents of a real person, including the person’s name, date of birth, and social security number, to gain employment in the United States. Bautista-Rubio told the agent that he specifically requested and obtained the identification documents of a real person to ensure that he could work here.
Bautista-Rubio was sentenced in Cedar Rapids by United States District Court Chief Judge Linda R. Reade. Bautista-Rubio was sentenced to 27 months’ imprisonment. A special assessment of $300 was imposed. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system.
Bautista-Rubio is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Daniel C. Tvedt and investigated by the Department of Homeland Security.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 14-CR-0052.
Idaho Man Sentenced to 20 Years for Distributing Child PornographyRead the Press Release
Orlando, FL – U.S. District Judge Paul G. Byron today sentenced Charles Keith Rolfe (60, Heyburn, Idaho) to 20 years in federal prison for distributing child pornography. The Court also ordered Rolfe to serve a lifetime term of supervised release and to register as a sex offender after he completes his prison sentence. A restitution hearing for his victims is scheduled for January 13, 2015. Rolfe pleaded guilty on June 27, 2014.
According to court documents, in the summer of 2013, Rolfe met an Orlando man, William Edward Osman, on an online social networking site. The two men soon began trading images of child pornography via a Mobile Messaging Application (“MMA”). Osman also told Rolfe that he had molested his one-year-old daughter.
On October 15, 2013, special agents with U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) arrested Osman on charges related to the sexual exploitation of children. Agents seized his cell phone and identified Rolfe as one of the men with whom Osman had been electronically trading child pornography. After assuming Osman’s online identity, agents communicated with Rolfe in an undercover capacity. On February 28, 2014, Rolfe sent the undercover agents at least three videos containing images of child pornography via the MMA on his cell phone. He also told the agents that he had attempted to molest his own five-year-old daughter when his wife was away, and that he was grooming his daughter for potential future sexual abuse.
Rolfe was arrested on April 3, 2014. A subsequent search of his home and cell phones revealed that Rolfe possessed almost 900 images of child pornography, many of which depicted children under the age of 12.
On September 3, 2014, Osman was sentenced to 60 years in federal prison for the production, distribution, and possession of child pornography."Crimes against our children will not be tolerated," said Susan L. McCormick, special agent in charge of HSI Tampa. "As a result of our collaboration with HSI Boise, and the investigative work of our agents here at home, this child predator can no longer victimize innocent children.”
This case was investigated by United States Immigration and Customs Enforcement’s Homeland Security Investigations. It was prosecuted by Assistant United States Attorney Joseph M. Schuster.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Hundred, WV Woman Sentenced for Distributing MarijuanaRead the Press Release
1125 Chapline Street, Federal Building, Suite 3000 ● Wheeling, WV 26003
(304) 234-0100 ● Contact: Tara Tighe, Public Affairs SpecialistWHEELING, WEST VIRGINIA – Nelda K. White, 55, of Hundred, West Virginia, was sentenced to twelve months and one day in prison for distributing marijuana, United States Attorney William J. Ihlenfeld, II, announced today.
White pled guilty in June 2014 to one count of "Conspiracy to Distribute Marijuana" after a West Virginia State Police investigation revealed that White was receiving shipments of marijuana from a source in California and reselling the marijuana in the Hundred, West Virginia area.
Assistant U.S. Attorney Steve Vogrin prosecuted the case on behalf of the government.
Chief U.S. District Judge John Preston Bailey presided.
Heroin Trafficker Faces Statutory Penalties of up to 60 Years in Federal Prison; To Forfeit Heroin Sales Proceeds of $382,227 in Cash, $39,000 Rolex WatchRead the Press Release
PROVIDENCE, R.I. – Neftali Reyes, a/k/a Popi, 32, of Providence, faces statutory penalties of up to 60 years in federal prison after pleaded guilty in U.S. District Court in Providence today to one count of conspiracy to distribute heroin and two counts of distribution of heroin. In addition, Reyes has agreed to forfeit $382,227 dollars and a Rolex watch valued at $39,000 seized by the government as a result of its investigation into Reyes’ drug trafficking activities and his arrest.
Reyes’ guilty plea is announced by United States Attorney Peter F. Neronha and Michael Ferguson, Acting Special Agent in Charge of the Drug Enforcement Administration’s (DEA) New England field division.
According to court documents and information presented to the court, since April, 2014, the Rhode Island DEA Drug Task Force has been conducting an investigation of a drug trafficking organization distributing heroin in Rhode Island involving the defendant, Neftali Reyes and others. To further the investigation, an undercover East Providence police officer, a member of the DEA Drug Task Force, contacted Reyes and arranged to make purchases of heroin from Reyes and his conspirators.
According to court documents, on two occasions in July 2014, the undercover East Providence police officer arranged with Reyes by telephone for the purchase of heroin. On each occasion a different “runner” met with the undercover officer at pre-determined locations in Providence and Cranston to complete the transactions. During discussions to arrange the second delivery, Reyes told the undercover officer arrangements for the sale and delivery of heroin to him was being slowed because his runners were “backed up.”
On August 25, 2014, law enforcement executed a court authorized arrest warrant issued for Reyes, arresting him as he left his residence and entered a parking garage. As Reyes was arrested, he dropped a shoebox containing $37,000 in cash, a cell phone and an iPad. A court authorized search of Reyes’ residence on the same day resulted in the seizure of $339,477 in cash from a safe, as well as additional cash and a men’s Rolex Oyster watch valued at $39,000 from the apartment.
According to court documents, Reyes admitted that the cash and the Rolex watch seized were the result of proceeds from the sale of heroin. Reyes agreed that he was selling heroin for $130 per gram and that the proceeds represent the sale of approximately 2,940 grams of heroin.
Reyes, who has been detained since his arrest, is scheduled to be sentenced by U.S. District Court Judge John J. McConnell, Jr., on February 3, 2015. Conspiracy to distribute heroin and distribution of heroin are punishable by statutory penalties of 20 years imprisonment, a fine of $1,000,000 and a term of supervised release of life with a minimum of three years.
The case is being prosecuted by Assistant U.S. Attorney Pamela E. Chin.
United States Attorney Peter F. Neronha acknowledges and thanks the Rhode Island Department of Attorney General and the East Providence Police Department for their assistance in the investigation of this matter.###
To assist the media and the public, a glossary of federal judicial terms and procedures is available at http://www.justice.gov/usao/justice101/
Contact: 401-709-5357
[email protected]Hanover Man Convicted of Receipt and Distribution of Child PornographyRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that Rodney Corbin, Jr., age 54, Hanover, Pennsylvania was sentenced today by Senior United States District Court Judge Sylvia H. Rambo to 97 months’ imprisonment, followed by 10 years of supervised release, anda $2,000 fine, for distribution and receipt of child pornography. Corbin pled guilty to the charges on October 1, 2013.
According to U.S. Attorney Peter Smith, Corbin purchased 28 separate orders of child pornography videos from an international company that produced images depicting the sexual exploitation of children. After securing a search warrant, law enforcement officers located two full carts, each measuring two by four by six feet in size, containing child pornography in Corbin’s residence.
Judge Rambo noted, this case represents the largest collection of printed child pornography ever seized in the Middle District of Pennsylvania. Corbin’s computer was also seized. During a search of the computer, investigators located thousands of images of child pornography.
This case was investigated by the United States Postal Inspection Service, the Pennsylvania State Police, the Department of Homeland Security (DHS), Homeland Security Investigations (HSI), Hanover Police Department and was prosecuted by Assistant United States Attorney Daryl F. Bloom.
Hammond Man, Meredith Corbin, Sentenced for Drug ViolationsRead the Press Release
U.S. Attorney Kenneth A. Polite announced that MEREDITH CORBIN, age 33, of Hammond, Louisiana, was sentenced today, having previously pled guilty to possession of cocaine hydrochloride with intent to distribute and possessing a firearm during and in relation to that drug-trafficking crime.
U.S. District Judge Eldon E. Fallon sentenced CORBIN to 12 months and 1 day for possession of cocaine with intent to distribute and 60 months for possessing a firearm in relation to possession with intent to distribute cocaine, with sentences to run consecutively for a total of 72-month term of imprisonment. Additionally, CORBIN was sentenced to serve 3 years of supervised release following imprisonment and ordered to pay a $200 special assessment fee.
U.S. Attorney Polite praised the work of the Drug Enforcement Administration and the Hammond Police Department in investigating this matter. Assistant United States Attorney Michael E. McMahon is in charge of the prosecution.
Gaithersburg Woman Convicted of Submitting Four Fraudulent Claims for Unemployment Insurance BenefitsRead the Press Release
Greenbelt, Maryland – Rebecca Lynn Biglow, age 42, of Gaithersburg, Maryland pleaded guilty today to mail fraud and aggravated identity theft in connection with a fraud scheme to obtain $71,022 in unemployment insurance benefits. Biglow also pleaded guilty to violating terms of her supervised release imposed after she had served time in prison for a previous federal conviction for bank fraud.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Bill Jones, of the Washington Regional Office, U.S. Department of Labor - Office of Inspector General, Office of Labor Racketeering and Fraud Investigations; and Mark Kaufman, Commissioner of the Maryland Department of Labor, Licensing and Regulation’s (DLLR) Division of Financial Regulation."Rebecca Biglow filed fraudulent unemployment insurance claims while she was already under court supervision for a previous crime," said U.S. Attorney Rod J. Rosenstein.
According to her plea agreement, on September 9, 2009, Biglow submitted an unemployment insurance benefits claim to DLLR, claiming that she had worked from April 2008 to September 2009 for a home cleaning service company, where she earned wages totaling $23,390. In fact, Biglow was incarcerated from October 2007 to August 2009, and had not worked for the company. From September 2009 to January 2011, DLLR paid Biglow a total of $17,272 on this claim.On May 20, 2011, Biglow submitted another claim for unemployment insurance benefits, stating that she had worked for an individual at a business where she earned wages totaling $36,042.18. In reality, Biglow never worked for this individual. From May 2011 to December 2012, DLLR paid Biglow a total of $29,670 on this second claim.
On May 31, 2013, Biglow submitted a third unemployment benefits claim using the name, social security number and date of birth of another individual. Biglow falsely claimed that this individual had worked from June 2012 to May 2013 for a child care center, where the individual had earned $54,370 in wages. From June to December 2013, DLLR paid a total of $13,330 on this claim.
Finally, on October 25, 2013, Biglow submitted a fourth unemployment benefits claim falsely stating that she had worked at a candle business, earning $36,798 in wages from February to October 2013. From October 2013 to May 2014, DLLR paid Biglow $10,750 on this claim.
Biglow agrees to pay forfeiture and restitution of $71,022, the total amount paid by DLLR on the four fraudulent claims.
Bigelow was on supervised release during the time she submitted these false claims, after having served time in prison for a previous bank fraud scheme.
Biglow faces a maximum sentence of 20 years in prison for mail fraud; a mandatory minimum of two years in prison consecutive to any other sentence imposed for aggravated identity theft; and three years in prison for violating her supervised release, less any term of imprisonment imposed upon revocation of supervised release. U.S. District Judge Deborah K. Chasanow scheduled sentencing for March 2, 2015.
United States Attorney Rod J. Rosenstein praised the Department of Labor – OIG and DLLR for their work in the investigation and thanked Assistant U.S. Attorney Thomas P. Windom, who is prosecuting the case.Fourteen Defendants Charged in White Plains Federal Court with Massive Mortgage Fraud ConspiracyRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and George Venizelos, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), and Carl E. DuBois, the Sheriff of Orange County, today announced the unsealing of an Indictment (the “Indictment”) charging 15 defendants, including 14 defendants with conspiracy to commit bank fraud and wire fraud in connection with mortgages and other loans secured by properties in Brooklyn, Manhattan and Monroe in Orange County, New York. The defendants include several related members of a family, the Rubins, as well as a real estate attorney and a real estate appraiser. The Indictment sets forth a total of 21 counts charging various defendants with additional crimes, including making false statements to lenders, aggravated identity theft, and theft of public money. Thirteen of the defendants were arrested today in a coordinated takedown. They will be arraigned on the charges in the Indictment before United States Magistrate Judge Paul E. Davison in the White Plains federal courthouse.
U.S. Attorney Preet Bharara stated: “The charges unsealed today describe a sweeping and cynical fraud. As alleged, the scheme carried out by the Rubins and others ripped off banks, welfare programs, and taxpayers. It ranged from 2004 to 2014, from Brooklyn to Harlem to Orange County, and the individuals involved alternately played the parts of prince or pauper, depending on which scam was being perpetrated. Now their alleged double dealing will be stopped, and they will have to submit to the truth-seeking process of the criminal justice system.”
FBI Assistant Director George Venizelos stated: “In a clear case of double dipping, the defendants convinced lenders of their affluence while allegedly accepting aid from government programs established for the benefit of those less fortunate, profiting from the proceeds of millions of dollars in fraudulently obtained loans and significantly defrauding the government of public money. May today’s charges remind those who poke holes in the government safety net and exploit gaps in the mortgage and banking sectors that they will face the error of their ways.”
Orange County Sheriff Carl E. DuBois stated: “We would like to thank United States Attorney Preet Bharara and his staff for their efforts and assistance, and I would also like to thank the personnel from all of the agencies involved for a commitment to this long and complicated investigation. It is important to note that this case originated from the Orange County Sheriff’s Office. Upon investigating what is usually a routine case, our investigator showed due diligence in her follow up, and with the latitude and encouragement by my office to investigate further using FBI resources, the result was a lengthy and comprehensive multi-jurisdictional, multi-million dollar mortgage fraud investigation.”
According to allegations made in the Indictment:
IRVING RUBIN, the defendant, was a purported real estate developer. IRVING RUBIN’s son, YEHUDA RUBIN, the defendant, was a purported mortgage broker and real estate developer. IRVING RUBIN, as well as his brothers ABRAHAM RUBIN, JACOB RUBIN, and SAMUEL RUBIN, the defendants; his sons YEHUDA RUBIN and JOEL RUBIN, the defendants; his wife, DESIREE RUBIN, the defendant; and his relatives-in-law JOEL KOPPEL, BENZION KRAUS, RIFKA RUBIN, RACHEL RUBIN, and RIVKY RUBIN, the defendants, claimed to own properties in Brooklyn, New York, as well as in Manhattan and Orange County, New York. MARTIN KOFMAN, the defendant, was a real estate lawyer licensed to practice in New York. PINCHUS GLAUBER, the defendant, was a real estate appraiser licensed in New York.
From at least in or about 2004 through in or about 2014, IRVING RUBIN, a/k/a “Joseph Rubin,” YEHUDA RUBIN, a/k/a “Yidel Rubin,” PINCHUS GLAUBER, MARTIN KOFMAN, JOEL KOPPEL, a/k/a “Yoel Koppel,” a/k/a “Joel Kopple,” BENZION KRAUS, a/k/a “Benzion Krauz,” a/k/a “Benzion Krause,” ABRAHAM RUBIN, DESIREE RUBIN, a/k/a “Henchy Rubin,” JACOB RUBIN, a/k/a “Yaakov Rubin,” JOEL RUBIN, a/k/a “Yoel Rubin,” RACHEL RUBIN, a/k/a “Ruchy Rubin,” RIFKA RUBIN, a/k/a “Sura Rubin,” RIVKY RUBIN, a/k/a “Rivka Rubin,” and SAMUEL RUBIN, a/k/a “Shaye Rubin,” the defendants, and others known and unknown (hereinafter, the “Rubin Organization”), fraudulently obtained mortgage loans and other loans from banks and other lending institutions (the “lenders”). The defendants obtained the loans by providing materially false information to the lenders about the borrowers’ assets and liabilities, including but not limited to false information about the borrower’s employment, income, bank accounts, and primary residence. Through their scheme, the defendants fraudulently obtained more than $20 million in loan proceeds in connection with more than twenty fraudulent loans. The majority of the loans went into default, and the majority of the loan proceeds were not repaid.
As part of the scheme to defraud, the defendants used the fraudulent loan proceeds to personally enrich themselves and their families. Fraudulently obtained loan proceeds were used toward, among other things, (i) credit card debts for personal expenses of defendants, (ii) personal home mortgage payments of defendants, (iii) other real estate development projects including projects from which the defendants and others earned rental income, and (iv) debts arising from other fraudulently obtained loans, to conceal the fraudulent nature of these loans.
As part of the scheme to defraud, the defendants and others known and unknown also engaged in extensive efforts to perpetuate and conceal the fraudulent scheme. These efforts included, but were not limited to:
- Numerous members of the conspiracy acting as the borrowers for different loans, falsely claiming that the purpose of the loans was to purchase or refinance their primary residence, when, in fact the property was not their primary residence, and the loan proceeds were later distributed to other members of the conspiracy and to entities they controlled.
- The common claim by multiple co-conspirators acting as borrowers of sole ownership or control of assets or bank accounts, to give the false appearance of creditworthiness, when in fact the assets and/or bank accounts were non-existent or were owned and controlled by other members of the conspiracy, and the borrower either had joint or no ownership of them.
- Sham transfers of ownership of properties from one member of the conspiracy to another, or to other trusted individuals, thereby confounding attempts by lenders to recover on defaulted loans and facilitating further fraudulent borrowing against the properties.
- Following default on a fraudulently obtained loan, coordinated efforts to deceive the lender into granting a satisfaction of the debt at a significant loss, such as by proposing short sales of properties that, unbeknownst to the lender, were not arm’s-length transactions.
In furtherance of the scheme to defraud, members of the conspiracy participated in fraudulently obtaining loans in several ways, including but not limited to the following:
- YEHUDA RUBIN, the defendant, was an organizer of the fraudulent scheme. YEHUDA RUBIN personally participated in at least ten of the particular fraudulent loans, in various roles, including as borrower, borrower’s power of attorney, mortgage broker, distributor of fraudulent loan proceeds, and arranger of short sales.
- IRVING RUBIN, DESIREE RUBIN, ABRAHAM RUBIN, JACOB RUBIN, SAMUEL RUBIN, JOEL RUBIN, RIVKY RUBIN, RACHEL RUBIN, JOEL KOPPEL, RIFKA RUBIN, and BENZION KRAUSE, the defendants, were borrowers who fraudulently obtained loans from banks and other lenders. Working in concert with co-conspirators, they obtained loans upon false representations and pretenses. IRVING RUBIN, ABRAHAM RUBIN, JACOB RUBIN, SAMUEL RUBIN, and JOEL RUBIN, among others, also participated in the scheme by, among other things, (i) obtaining ownership of properties, (ii) assisting other borrowers in making false representations, (iii) receiving fraudulent loan proceeds, (iv) obtaining and distributing rental income on the properties, and (v) assisting in efforts to prevent or dissuade a lender from collecting on a defaulted loan.
- MARTIN KOFMAN, the defendant, acted as real estate attorney on numerous transactions associated with the fraudulent loans, including closings. KOFMAN, through his law firm’s trust account, distributed fraudulent loan proceeds between and among members of the conspiracy. KOFMAN also provided false information to lenders, including “show checks,” to deceive a bank into believing that the borrower had made a down payment toward the purchase of a property, when in fact the borrower made no such payment and the checks were ultimately deposited back into the law firm’s trust account.
- PINCHUS GLAUBER, the defendant, completed multiple appraisals of properties in connection with particular fraudulent loans. GLAUBER included false information in the appraisals, including about the detail with which he had inspected the properties he appraised. The estimated value of certain properties appraised by GLAUBER was false and inflated.
At the same time that the defendants were representing to banks that they had substantial income and assets, they were also representing to state and local agencies that they had little or no income and assets and were entitled to receive various forms of public assistance, including Medicaid, Food Stamps, and Home Energy Assistance Program (“HEAP”) benefits. For example:
- YEHUDA RUBIN and RACHEL RUBIN, the defendants, received Medicaid and Food Stamps at various times during the conspiracy. To receive benefits, they claimed, among other things, that their only income was $180 per month, and later $360 bi-weekly, from RACHEL RUBIN’s employment. To receive loans totaling more than $1 million, on the other hand, YEHUDA RUBIN claimed that he was employed, earning more than $17,000 per month in employment and rental income, and RACHEL RUBIN claimed that she was employed, earning $14,000 per month.
- JOEL RUBIN and RIVKY RUBIN, the defendants, received Medicaid and Food Stamps at various times during the conspiracy. To receive benefits, they claimed, among other things, that they were homeless, and later that their only income was $130 per week and $180 per week. To receive loans totaling more than $1 million, on the other hand, they claimed that RIVKY RUBIN was employed and had an income of $12,000 per month.
- SAMUEL RUBIN, the defendant, received Medicaid and Food Stamps at various times during the conspiracy. To receive benefits, SAMUEL RUBIN claimed, among other things, an income of $200 per week and $0 in financial resources. To receive loans in excess of $7 million, however, SAMUEL RUBIN claimed an income of more than $350,000 per year and a net worth of more than $10 million.
- IRVING RUBIN and DESIREE RUBIN, the defendants, received Medicaid at various times during the conspiracy. To receive benefits, IRVING RUBIN and DESIREE RUBIN claimed, among other things, that their only income was $1,200 per week, from IRVING RUBIN’s employment at Tristate Management. To receive a loan in excess of $500,000, on the other hand, IRVING RUBIN and DESIREE RUBIN claimed, among other things, that DESIREE RUBIN was employed at Tristate Management with a monthly income of $16,000.
In addition, seven are charged with theft of public money, in violation of Title 18, United States Code, Section 641. In particular, the defendants are charged with obtaining Medicaid and/or Food Stamps by submitting false information in the applications for such benefits.
The defendants and the counts with which they are charged in the Indictment are set forth in the attached list.
Mr. Bharara praised the investigative work of the FBI and the Orange County Sheriff’s Office.
The prosecution is being handled by the Office’s White Plains Division. Assistant U.S. Attorneys Benjamin Allee, Kathryn Martin, and Michael Maimin are in charge of the prosecution.
The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
U.S. v. Irving Rubin, et al. Indictment
U.S. v. Rubin, et al. Ages & Residences Chart
Fort Thompson Man Charged with Assaulting, Resisting and Impeding A Federal OfficerRead the Press Release
United States Attorney Brendan V. Johnson announced that a Fort Thompson, South Dakota, man has been indicted by a federal grand jury for Assaulting, Resisting and Impeding a Federal Officer.
Tony O. St. John, a/k/a Anthony St. John, age 25, was indicted on October 15, 2014. He appeared before U.S. Magistrate Judge Mark A. Moreno on November 10, 2014, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 20 years in custody and/or a $250,000 fine, 3 years of supervised release, and up to $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on or about September 30, 2014, St. John forcibly assaulted, resisted, opposed, impeded, intimidated, and interfered with officers from the Bureau of Indian Affairs, Crow Creek Agency, when the officers were engaged in the performance of their official duties and employed as federal law enforcement officers with the Department of Interior.
The charges are merely accusations and St. John is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Bureau of Indian Affairs, Crow Creek Agency. Assistant U.S. Attorney Meghan N. Dilges is prosecuting the case.
St. John was remanded to the custody of the U.S. Marshals Service pending trial, which has been set for January 6, 2015.
Former Wilmington Trust Officer Pleads Guilty to Accepting A Gift for Procuring LoansRead the Press Release
WILMINGTON, Del. – Charles M. Oberly, III, United States Attorney for the District of Delaware, announced today that Peter W. Hayes, age 49 of Newark, DE, pleaded guilty to one count of accepting a gift for procuring loans, in violation of Title 18, United States Code, Section 215. United States District Judge Richard G. Andrews scheduled a sentencing hearing for March 17, 2015, at 9 a.m.
Hayes, a former Relationship Manager at Wilmington Trust Corp. (“WTC” or the “Bank”), admitted that he purchased two model homes from a large Bank customer (the “customer”) in November 2005 as part of a sale/lease-back arrangement, whereby the customer agreed to pay Hayes and his business partner monthly lease payments in the exact amount of, and to satisfy, their monthly mortgage payments. In March 2008, Hayes and his partner sold the model homes to a third-party for a loss, leaving Hayes with a $70,000.00 obligation to his mortgage lender. Hayes ultimately requested a loan from the WTC customer to cover the shortfall. In November 2008, the customer loaned Hayes the necessary funds by issuing him a check from the customer’s operating account at WTC. Hayes repaid the loan in February 2009 by depositing a treasury check directly into the customer’s WTC operating account.
During the four year period in which Hayes had a financial relationship with the customer, he approved millions of dollars in financing for various projects being developed by the customer. As part of his guilty plea, Hayes admitted to making specific funding decisions for the customer that were based on materially false statements and omissions, or were otherwise in contravention of existing loan agreements.
With his guilty plea, Hayes becomes the third former Bank employee to plead guilty to criminal conduct relating to his employment at WTC.
United States Attorney Oberly said, “It is a serious offense for a bank insider to engage in self-dealing with a client for his own personal benefit. The successful prosecution of Mr. Hayes demonstrates my Office’s commitment to uncover criminal misconduct committed by bank officers, particularly where such activity has the potential to affect the safety and soundness of a financial institution and its shareholders.”
The case was investigated by the Federal Bureau of Investigation; the Special Inspector General for the Troubled Asset Relief Program (SIGTARP); and the Internal Revenue, Service Criminal Investigation Division, and is being prosecuted by Assistant United States Attorneys Robert F. Kravetz and Lesley F. Wolf.
“Hayes, a former relationship manager at TARP bank Wilmington Trust, is the third employee to plead guilty to charges stemming from the investigation by SIGTARP and our partners of purported criminal conduct at the bank,” said Christy Romero, Special Inspector General for TARP (SIGTARP). “In today’s plea, Hayes admitted to exchanging favors with a long-time bank customer for his personal benefit. SIGTARP and our law enforcement partners stand united in our commitment to safeguarding TARP on behalf of taxpayers, and perpetrators of crime related to TARP will be brought to justice.”Former Swiss Banker Charged in Manhattan Federal Court for Conspiring with U.S. Taxpayers to Hide Hundreds of Millions of Dollars in Swiss Bank AccountsRead the Press Release
U.S. Attorney Preet Bharara for the Southern District of New York and Acting Special Agent in Charge Shantelle P. Kitchen of the New York Field Office of the Internal Revenue Service- Criminal Investigation (IRS-CI) announced today the indictment of Martin Dunki, a former client advisor and Senior Vice President at a Swiss bank headquartered in Zurich, Switzerland (Swiss Bank No. 1), for conspiring with U.S. taxpayer-clients and others to hide hundreds of millions of dollars in offshore accounts from the IRS, and to evade U.S. taxes on the income earned in those accounts.
“As alleged, Martin Dunki went to great lengths to help his U.S. taxpayer clients secret away millions of dollars in Swiss bank accounts,” said U.S. Attorney Bharara. “With today’s Indictment, Dunki joins the ranks of many other individuals this Office has charged in connection with hiding money in offshore bank accounts from the Internal Revenue Service.”
“The vigorous pursuit of unreported income in hidden offshore accounts is a top priority for the Internal Revenue Service,” said Acting IRS-CI Special Agent in Charge Shantelle P. Kitchen. “As part of our strategy, we will continue to identify and investigate banking and finance professionals who advise U.S. clients about ways to conceal their assets from the U.S. Government.”
According to the allegations contained in the indictment, which was unsealed today in Manhattan federal court, and other publicly available information:
Between 1995 and 2012, Dunki helped U.S. taxpayers evade taxes and hide hundreds of millions of dollars in undeclared accounts at Swiss Bank No. 1. Dunki provided this advice and assistance to U.S. taxpayers in his capacity as a client advisor at Swiss Bank No. 1, where he was employed until early 2012.
One of Dunki’s co-conspirators was Edgar Paltzer, an attorney based in Zurich, Switzerland, who previously pleaded guilty in the Southern District of New York for his role in assisting U.S. taxpayers and others to evade taxes. In 1999, Dunki, Paltzer and an attorney from Santa Barbara, California (Attorney 1), began working together in the management of undeclared accounts at Swiss Bank No. 1 for a number of U.S. taxpayers (collectively, the Dunki/Attorney 1 Clients). The undeclared assets of the Dunki/Attorney 1 Clients were maintained in accounts held in the names of sham foreign foundations, rather than in the names of the clients individually, to help the clients conceal their ownership of these undeclared accounts from the IRS. Initially, the sham foundations that held the accounts were organized under the laws of Liechtenstein. In December 2008, however, Liechtenstein and the United States signed a Tax Information Exchange Treaty (TIEA), under which Liechtenstein agreed to provide the United States with access to certain bank and other information needed to enforce U.S. tax laws. As a result of the TIEA between Liechtenstein and the United States, and to prevent disclosure to the IRS of the undeclared accounts maintained by the Dunki/Attorney 1 Clients, Dunki and others transferred the undeclared assets of the Dunki/Attorney 1 Clients to new accounts at Swiss Bank No. 1, held by new sham foundations organized under the laws of Panama. Moreover, beginning in August 2009, in response to the investigation of another Swiss bank, UBS AG, for helping U.S. taxpayers maintain undeclared accounts in Switzerland, Dunki and others helped to further conceal the undeclared accounts of the Dunki/Attorney 1 Clients by using assets in those accounts to purchase gold and other precious metals. The gold and precious metals, which amounted to tens of millions of dollars, were then transferred to escrow accounts opened at Swiss Bank No. 1 and hidden, along with substantial sums of cash, in a vault in Switzerland for the benefit of the Dunki/Attorney 1 Clients.
In addition to opening, maintaining, and managing undeclared accounts at Swiss Bank No. 1 for the Dunki/Attorney 1 Clients, Dunki opened, maintained and managed undeclared accounts at Swiss Bank No. 1 for other U.S. taxpayers. For instance, between 2000 and 2012, Dunki helped one U.S. taxpayer hide nearly $300 million in assets at Swiss Bank No. 1, in undeclared accounts held in the names of sham Liberian corporations. Further, between 1995 and 2008, Dunki helped another U.S. taxpayer maintain approximately $70 million in an undeclared account at Swiss Bank No. 1. When Dunki met with this taxpayer in the United States, the account statements that Dunki brought with him were deliberately cut off at the top, to omit the account number and the name of Swiss Bank No. 1, because – as Dunki himself acknowledged to the taxpayer – Dunki had to be careful not to leave a trace when going through U.S. customs.
Dunki also helped U.S. taxpayers bring funds back to the United States in ways designed to ensure that U.S. authorities would not discover the existence of the taxpayers’ undeclared accounts at Swiss Bank No. 1. For example, on at least one occasion, Dunki met a U.S. taxpayer in the United States and provided the taxpayer with an envelope containing approximately $10,000 in cash, which represented a cash withdrawal from the taxpayer’s undeclared account at Swiss Bank No. 1. On other occasions, Dunki helped send money from a U.S. taxpayer’s undeclared account at Swiss Bank No. 1 to another account in Geneva, Switzerland, and, from there, to a diamond dealer in Manhattan. Once the money was received by the diamond dealer, the U.S. taxpayer would pick it up and give the diamond dealer a fraction of the money as a commission.
Dunki, 66, a Swiss citizen, resides in Switzerland and has not been arrested. Dunki is charged with one count of conspiracy to defraud the IRS, which carries a maximum sentence of five years in prison. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
U.S. Attorney Bharara praised the outstanding efforts of IRS-CI in the investigation, which he noted is ongoing. He also thanked the Justice Department’s Tax Division for their significant assistance in the investigation.
This case is being handled by the U.S. Attorney’s Office for the Southern District of New York Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Sarah E. Paul and Jason H. Cowley are in charge of the prosecution.
The charge and allegations contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Former Swiss Banker Charged in Manhattan Federal Court for Conspiring with U.S. Taxpayers to Hide Hundreds of Millions of Dollars in Swiss Bank AccountsRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and Shantelle P. Kitchen, Acting Special Agent in Charge of the New York Field Office of the Internal Revenue Service, Criminal Investigation (“IRS-CI”), announced today the indictment of MARTIN DUNKI, a former client advisor and Senior Vice President at a Swiss bank headquartered in Zurich, Switzerland (“Swiss Bank No. 1”), for conspiring with U.S. taxpayer-clients and others to hide hundreds of millions of dollars in offshore accounts from the IRS, and to evade U.S. taxes on the income earned in those accounts.
Manhattan U.S. Attorney Preet Bharara said: “As alleged, Martin Dunki went to great lengths to help his U.S. taxpayer clients secret away millions of dollars in Swiss bank accounts. With today’s Indictment, Dunki joins the ranks of many other individuals this Office has charged in connection with hiding money in offshore bank accounts from the Internal Revenue Service.”
Acting IRS-CI Special Agent in Charge Shantelle P. Kitchen said: “The vigorous pursuit of unreported income in hidden offshore accounts is a top priority for the Internal Revenue Service. As part of our strategy, we will continue to identify and investigate banking and finance professionals who advise U.S. clients about ways to conceal their assets from the U.S. Government.”
According to the allegations contained in the Indictment, which was unsealed today in Manhattan federal court, and other publicly available information:
Between 1995 and 2012, DUNKI helped U.S. taxpayers evade taxes and hide hundreds of millions of dollars in undeclared accounts at Swiss Bank No. 1. DUNKI provided this advice and assistance to U.S. taxpayers in his capacity as a client advisor at Swiss Bank No. 1, where DUNKI was employed until early 2012.
One of DUNKI’s co-conspirators was Edgar Paltzer, an attorney based in Zurich, Switzerland, who previously pled guilty in the Southern District of New York for his role in assisting U.S. taxpayers and others to evade taxes. In 1999, DUNKI, Paltzer, and an attorney from Santa Barbara, California (“Attorney 1”) began working together in the management of undeclared accounts at Swiss Bank No. 1 for a number of U.S. taxpayers (collectively, the “Dunki/Attorney 1 Clients”). The undeclared assets of the Dunki/Attorney 1 Clients were maintained in accounts held in the names of sham foreign foundations, rather than in the names of the clients individually, to help the clients conceal their ownership of these undeclared accounts from the IRS. Initially, the sham foundations that held the accounts were organized under the laws of Liechtenstein. In December 2008, however, Liechtenstein and the United States signed a Tax Information Exchange Treaty (“TIEA”), under which Liechtenstein agreed to provide the United States with access to certain bank and other information needed to enforce U.S. tax laws. As a result of the TIEA between Liechtenstein and the United States, and to prevent disclosure to the IRS of the undeclared accounts maintained by the Dunki/Attorney 1 Clients, DUNKI and others transferred the undeclared assets of the Dunki/Attorney 1 Clients to new accounts at Swiss Bank No. 1, held by new sham foundations organized under the laws of Panama. Moreover, beginning in August 2009, in response to the investigation of another Swiss bank, UBS AG (“UBS”), for helping U.S. taxpayers maintain undeclared accounts in Switzerland, DUNKI and others helped to further conceal the undeclared accounts of the Dunki/Attorney 1 Clients by using assets in those accounts to purchase gold and other precious metals. The gold and precious metals, which amounted to tens of millions of dollars, were then transferred to escrow accounts opened at Swiss Bank No. 1 and hidden, along with substantial sums of cash, in a vault in Switzerland for the benefit of the Dunki/Attorney 1 Clients.
In addition to opening, maintaining, and managing undeclared accounts at Swiss Bank No. 1 for the Dunki/Attorney 1 Clients, DUNKI opened, maintained, and managed undeclared accounts at Swiss Bank No. 1 for other U.S. taxpayers. For instance, between 2000 and 2012, DUNKI helped one U.S. taxpayer hide nearly $300 million in assets at Swiss Bank No. 1, in undeclared accounts held in the names of sham Liberian corporations. Further, between 1995 and 2008, DUNKI helped another U.S. taxpayer maintain approximately $70 million in an undeclared account at Swiss Bank No. 1. When DUNKI met with this taxpayer in the United States, the account statements that DUNKI brought with him were deliberately cut off at the top, to omit the account number and the name of Swiss Bank No. 1, because – as DUNKI himself acknowledged to the taxpayer – DUNKI had to be careful not to leave a trace when going through U.S. customs.
DUNKI also helped U.S. taxpayers bring funds back to the United States in ways designed to ensure that U.S. authorities would not discover the existence of the taxpayers’ undeclared accounts at Swiss Bank No. 1. For example, on at least one occasion, DUNKI met a U.S. taxpayer in the United States and provided the taxpayer with an envelope containing approximately $10,000 in cash, which represented a cash withdrawal from the taxpayer’s undeclared account at Swiss Bank No. 1. On other occasions, DUNKI helped send money from a U.S. taxpayer’s undeclared account at Swiss Bank No. 1 to another account in Geneva, Switzerland and, from there, to a diamond dealer in Manhattan. Once the money was received by the diamond dealer, the U.S. taxpayer would pick it up and give the diamond dealer a fraction of the money as a commission.
DUNKI, 66, a Swiss citizen, resides in Switzerland and has not been arrested. DUNKI is charged with one count of conspiracy to defraud the IRS, which carries a maximum sentence of five years in prison. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Bharara praised the outstanding efforts of IRS-CI in the investigation, which he noted is ongoing. He also thanked DOJ’s Tax Division for their significant assistance in the investigation.
This case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Sarah E. Paul and Jason H. Cowley are in charge of the prosecution.
The charge and allegations contained in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Former Shelby County Hospital CFO Guilty in EHR Incentive CaseRead the Press Release
Department of Justice
Office of Public AffairsTYLER, Texas – The former Chief Financial Officer of Shelby Regional Medical Center has pleaded guilty to federal violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Joe White, 67, of Cameron, Texas, pleaded guilty on Nov. 12, 2014 to making a false statement before U.S. Magistrate Judge John D. Love.
According to information presented in court, White was the Chief Financial Officer for Shelby Regional Medical Center in Center, Texas, which was owned and operated by Dr. Tariq Mahmood. White oversaw the implementation of electronic health records for the hospital and was responsible for attesting to the meaningful use of electronic health records in order to qualify to receive incentive payments under Medicare’s Electronic Health Record (EHR) Incentive Program. On Nov. 20, 2012, White knowingly made a false statement to Medicare falsely representing that the hospital was a meaningful user of electronic health records, when the hospital did not meet the meaningful use requirements. As a result, Shelby Regional Medical Center received $785,655.00 from Medicare. White was indicted by a federal grand jury on Feb. 6, 2014.
White faces up to five years in federal prison at sentencing. A sentencing date has not been set.This case was investigated by the U.S. Department of Health and Human Services – Office of the Inspector General (HHS-OIG), the Texas Office of the Attorney General – Medicaid Fraud Control Unit (OAG-MFCU), and the Federal Bureau of Investigation (FBI). This case is being prosecuted by Special Assistant U.S. Attorney Kenneth C. McGurk and Assistant U.S. Attorney Nathaniel C. Kummerfeld.
Any individuals with knowledge of these or other health care fraud violations are encouraged to contact the Department of Health and Human Services’ fraud hotline at 1-800-HHS-TIPS (447-8477).
Former Senior Systems Engineer at National Law Firm Pleads Guilty in Manhattan Federal Court to Insider TradingRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today that DMITRY BRAVERMAN, a former Senior Systems Engineer at a prominent national law firm, pled guilty today in Manhattan federal court to insider trading. Specifically, BRAVERMAN admitted repeatedly using material nonpublic information concerning planned merger and acquisition activity of at least eight clients of the law firm to acquire stock and options, resulting in profits of more than $300,000. BRAVERMAN, who was arrested in September 2014, pled guilty to a one-count Information before U.S. District Judge Paul A. Engelmayer.
Manhattan U.S. Attorney Preet Bharara said: “Dmitry Braverman abused the trust not only of his employer, a major law firm, but also of the numerous companies that relied upon the law firm to handle sensitive matters. Today’s conviction is yet another in a long line.”
According to the allegations contained in the Information filed today in Manhattan federal court, the underlying criminal Complaint, and statements made during court proceedings:
From at least September 2010 through December 2013, BRAVERMAN was engaged in an insider trading scheme. BRAVERMAN, who was a senior systems engineer at a national, full-service law firm, was primarily responsible for maintaining and designing software in connection with the law firm’s finance function, and had access to financial and billing databases. BRAVERMAN consequently had computer and database systems access to confidential information about, among other things, the law firm’s clients in potential merger and acquisition activity, as well as information about the identities of the other parties to the potential deal.
Between about 2010 and 2011, BRAVERMAN engaged in at least four trades that were based on inside information concerning potential mergers and acquisition activity of clients of the law firm. In April 2011, however, BRAVERMAN closed out the last of these trades on the same day that another employee of the law firm, Matthew Kluger, was arrested on separate insider trading charges. In November 2012, BRAVERMAN opened a new brokerage account in the name of a relative living in Russia, and again began trading on the basis of inside information he obtained from the law firm. Specifically, between November 2012 and December 2013, BRAVERMAN engaged in at least four additional trades based on inside information. In total, BRAVERMAN made more than approximately $300,000 in profits from the trades.
BRAVERMAN, 41, of San Mateo, California, pled guilty to one count of securities fraud, without the benefit of a plea agreement. The securities fraud count carries a maximum sentence of 20 years in prison, a maximum fine of $5 million, or twice the gross gain or loss from the offense, and forfeiture of the proceeds of the offense. BRAVERMAN is scheduled to be sentenced by U.S. District Judge Paul A. Engelmayer on March 6, 2015. The statutory maximum sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Bharara praised the investigative work of the Federal Bureau of Investigation and thanked the Securities and Exchange Commission, which has filed civil charges in a separate action.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Since the inception of FFETF in November 2009, the Justice Department has filed more than 12,841 financial fraud cases against nearly 18,737 defendants including nearly 3,500 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Matthew L. Schwartz and Benjamin Naftalis are in charge of the prosecution.
Former Owner of Sacramento Capitals Tennis Team Sentenced to 20 Years in Prison for Fraud Scheme Exceeding $100 Million in LossesRead the Press Release
SACRAMENTO, Calif. — Deepal Wannakuwatte, 63, of Sacramento, was sentenced today to 20 years in prison for a long-running fraud scheme, announced United States Attorney Benjamin B. Wagner, Special Agent in Charge Monica M. Miller of the FBI’s Sacramento Field Office, Acting Special Agent in Charge Thomas McMahon for the IRS-Criminal Investigation, and Special Agent in Charge Wade V. Walters of the Federal Deposit Insurance Corporation Office of Inspector General.
In addition to the prison term, United States District Judge Troy L. Nunley ordered Wannakuwatte to forfeit multiple properties, vehicles, business interests, and bank accounts to be used to provide restitution to victims. The total value of the properties, vehicles, business interests, and bank accounts is estimated to be at least $3.5 million.
According to court documents, from 2002 to 2014, Wannakuwatte convinced nearly 200 victims, including individuals, corporate entities, and financial institutions, to invest in a number of business opportunities by misrepresenting the financial worth of himself and his companies. Wannakuwatte’s companies, IMG and Relyaid, were involved in the international manufacture, shipment, and distribution of latex gloves. He falsely claimed that these companies did tens of millions of dollars in business with federal agencies every year, most notably the Department of Veterans Affairs. In 2013, Wannakuwatte claimed to have more than $125 million in VA contracts alone. In fact, while he did have a contract with the VA, it was only worth up to $25,000 a year.
Ultimately, Wannakuwatte obtained well over $230 million from his victims. Contrary to his representations, Wannakuwatte used much of the money he obtained to pay himself and his family, make lulling payments to participants in his fraudulent investment schemes, and pay outstanding debts unrelated to his false representations. A former owner of the Sacramento Capitals professional tennis team, Wannakuwatte purchased properties in Hawaii, Oregon and California.
In order to establish his financial credibility, Wannakuwatte showed investors his personal and corporate tax returns where he actually reported and paid taxes that falsely overstated his annual personal income and the annual gross receipts and sales for IMG. He used investors’ money to pay the overstated tax returns.
In sentencing Wannakuwatte, Judge Nunley told the defendant, “You embody true evil. … There is no amount of time I can sentence you to that would appease your victims.”
“This sentence brings to an end to one of the longest running, most extensive, and most damaging fraud schemes our region has ever seen,” said U.S. Attorney Wagner. “The total losses to investor victims exceeds $100 million. The sentence imposed today is tantamount to a life sentence, although no amount of prison time will undo the harm he caused to so many victims. I want to commend the FBI and IRS-CI for detecting and swiftly stopping this scheme before it caused even greater losses.”
“Wanakuwatte’s victims — individuals, businesses, government agencies, venture funds, and financial institutions — suffered as his elaborate scheme collapsed. In his high‑profile pursuit for prestige and financial gain, Wannakuwatte had no regard for public trust and the financial stability of his victims,” said Special Agent in Charge Monica M. Miller of the Sacramento Division of the Federal Bureau of Investigation. “We thank the IRS Criminal Investigation and FDIC Office of Inspector General for their partnership throughout this investigation. We are committed to aggressively pursue those who attempt to circumvent the law for personal gain.”
“This case shows that the appearance of success can mask a tangled financial web of lies,” said Acting Special Agent in Charge Thomas McMahon, IRS-Criminal Investigation. “Today’s sentencing represents the severity of the fraud committed by Wannakuwatte and those he hurt the most: the victims who fell prey to the massive fraud scheme. The victims will never be whole again from the fraud totaling more than $230 million, but rest assured they will have the comfort of knowing Wannakuwatte will be incarcerated for many years to come. This case should serve as a warning to those thinking of committing fraud.”
FDIC OIG Special Agent in Charge Wade V. Walters stated, “The sentencing of Mr. Wannakuwatte today reflects fitting punishment for a fraud scheme that victimized so many trusting individuals, businesses, government agencies, financial institutions, and others. We are pleased to have played a part in bringing Mr. Wannakuwatte to justice and value our cooperative working relationships with the U.S. Attorney's Office, FBI, and IRS-CI.”
This case is the product of an investigation by the Federal Bureau of Investigation, the Internal Revenue Service, Criminal Investigation, and the Federal Deposit Insurance Corporation, Office of Inspector General, Office of Investigations. Assistant United States Attorneys Michael Beckwith and Kevin Khasigian are prosecuting the case.
Former Corrections Officer Pleads Guilty to Bribery, Admits Taking Cash to Smuggle Contraband into FacilitySecond Former Officer Earlier Pled Guilty in Related CaseRead the Press Release
WASHINGTON - Lenard Fleming, 34, a former corrections officer who worked for the Corrections Corporation of America (CCA), pled guilty today to a bribery charge for accepting money to smuggle contraband into the District of Columbia’s Correctional Treatment Facility.
The guilty plea was announced by U.S. Attorney Ronald C. Machen Jr.; Andrew G. McCabe, Assistant Director in Charge of the FBI’s Washington Field Office; and Thomas N. Faust, Director of the District of Columbia Department of Corrections.
Fleming, of District Heights, Md., pled guilty in the U.S. District Court for the District of Columbia to one count of bribery. The Honorable Judge Ketanji Brown Jackson scheduled sentencing for Feb. 12, 2015. Under federal sentencing guidelines, Fleming faces a likely range of 24 to 37 months of incarceration, as well as a fine of up to $60,000. Fleming is subject to forfeiture money judgment for money taken in the bribery scheme.
According to the government’s evidence, Fleming had worked for the Corrections Corporation of America (CCA) as a corrections officer at the Correctional Treatment Facility. CCA, a private company, has a contract to provide services to the D.C. Jail.
During the investigation, the FBI recovered contraband from an inmate at the Correctional Treatment Facility in January 2014. Fleming admitted that he smuggled items for the same inmate through that inmate’s contacts outside of the Correctional Treatment Facility. Fleming received cash payments in exchange for smuggling cigarettes and, on one occasion, an iPhone, into the Correctional Treatment Facility for delivery to the inmate.
Fleming was terminated by CCA in February 2014 following a complaint that he was smuggling contraband into the facility for another inmate. CCA was presented with allegations that Fleming met several times with the wife of another inmate. On each occasion, the inmate’s wife provided Fleming cash in exchange for Fleming smuggling cigarettes and synthetic marijuana into the facility and delivering it to the inmate. Fleming was arrested April 30, 2014.
In a related investigation, another former corrections officer at the Correctional Treatment Facility, Darren Malry, 52, pled guilty on Oct. 17, 2014, to a bribery charge. According to the government’s evidence, on March 11, 2014, Malry smuggled contraband into the facility for an inmate. Malry was arrested that day. Malry is to be sentenced Feb. 6, 2015.
In announcing today’s plea, U.S. Attorney Machen and Assistant Director in Charge McCabe, and Director Faust commended the work of those who jointly worked the case, including agents from the FBI’s Washington Field Office, investigators from the District of Columbia Department of Corrections Office of Investigative Services, and investigators from the Corrections Corporation of America. They also commended the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialists Donna Galindo, Corinne Kleinman, and Angela Lawrence; Assistant U.S. Attorneys Melinda Williams, Todd Gee, and former Assistant U.S. Attorney Justin Dillon, who assisted in the investigation, and Assistant U.S. Attorneys Catherine K. Connelly, Allessandra Stewart, and Arvind Lal, who assisted with forfeiture issues. Finally, they expressed appreciation for the work of Assistant U.S. Attorney Richard DiZinno, who prosecuted the case.
14-254Former CFO of New York Brokerage Firm Sentenced to 33 Months in Prison for Stealing $1 Million from His Former EmployerRead the Press Release
TRENTON, N.J. – The former chief financial officer of the Manhattan-based brokerage firm Needham & Co. was sentenced today to 33 months in prison for stealing $1 million from his former employer through an elaborate false invoicing scheme, U.S. Attorney Paul J. Fishman announced.
Glen W. Albanese, 43, of Manalapan, New Jersey, previously pleaded guilty before U.S. District Judge Peter G. Sheridan to an information charging him with conspiring to steal $1 million from Needham & Co. Judge Sheridan imposed the sentence today in Trenton federal court.
Two of Albanese’s conspirators, Vincent Sarubbi, 44, of Manalapan, and Eric Siegel, 39, of New York, have also pleaded guilty in connection with their roles in the scheme. Siegel was sentenced on Sept. 23, 2014 to serve eight months of home confinement and pay restitution of $395,212. Sarubbi was sentenced today to serve 14 months of home confinement and pay restitution of $436,195.
According to documents filed in this case and statements made in court:
From 2000 through 2010, while he was employed as the CFO of Needham & Co., a broker-dealer with headquarters in New York, Albanese stole $1 million from the company through a false invoicing scheme. Albanese induced several vendors of Needham – including Data Source Partners, an information technology services company owned by Sarubbi, and S&R Graphic Company, a printing company where Siegel worked – to submit fraudulent invoices to Needham. Some of the fraudulent invoices charged for services that were never provided, while others inflated the amount due for services that were provided. Albanese approved the fraudulent invoices on behalf of Needham and then directed the vendors to send him the bulk of the illicit proceeds.
The vendors funneled the illicit proceeds to Albanese in a variety of ways. Albanese admitted that he directed Siegel to meet him at predetermined locations in Manhattan with envelopes containing thousands of dollars in cash. He directed both Siegel and Sarubbi to pay his personal expenses directly. Siegel and Sarubbi used the proceeds from the scheme to pay for landscaping and interior decorating at Albanese’s residence, a designer-breed dog and “canine fence,” equestrian equipment, thousands of dollars’ worth of wine and more than $40,000 in flights, hotels and travel expenses.
In addition to the prison term, Judge Sheridan sentenced Albanese to serve three years of supervised release and pay restitution of $1 million.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark, with the investigation.
The government is represented by Zach Intrater, Deputy Chief of the U.S. Attorney’s Office General Crimes Unit in Newark.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.stopfraud.gov.
Defense counsel: Joseph R. Benfante Esq., New York
14-398Former Banker Sentenced to More Than Seven Years for Laundering Proceeds of Stolen Identity Refund FraudRead the Press Release
Tampa, FL – U.S. District Judge James S. Moody, Jr. has sentenced Howayda Hamdan to seven years and six months in federal prison for engaging in a conspiracy to commit wire fraud and aggravated identity theft. As part of her sentence, the court also entered a money judgment in the amount of $1,168,858.11, the proceeds of the conspiracy. Hamdan pleaded guilty on August 21, 2014.
According to court documents, from January 2011 to April 20, 2011, while working as a personal banker for Regions Bank, Hamdan opened 292 bank accounts using 146 stolen identities. These accounts were opened for the sole purpose of laundering fraudulently obtained federal income tax refund checks that were acquired using the stolen identities of another 219 unknowing victims.
Hamdan’s co-conspirators, Riad Sulaiman, Nedal Ahmad, and Khaldoun Khalil Khawaja, owned and operated businesses where they knowingly negotiated fraudulently obtained tax refund checks. The co-conspirators brought the fraudulently obtained Treasury checks to Hamdan so they could be deposited and the proceeds withdrawn. Many of these checks were issued in the names of deceased individuals.
Hamdan needed means of identification, including names and Social Security numbers, to open the accounts at Regions Bank. Co-conspirator Dana Brown, a police officer, provided printouts from DAVID, Florida’s driver’s license database. The printouts contained the personally identifiable information (PII) required to open the bogus bank accounts. Since the victims of the tax filing scheme were often deceased, lived outside Florida, and/or were unknown to Hamdan and her co-conspirators, the stolen identities used to open the bank accounts were different, although similar in name, than the stolen identities used by the tax filers to obtain the tax refunds.
Once Hamdan deposited the fraudulently obtained Treasury checks, she facilitated the distribution of the proceeds to her co-conspirators, including her husband, Hicham El Faoutih. In May 2011, agents searched Hamdan’s residence. Among other things, they recovered $81,460.00 in cash (still inside a Regions Bank bag and wrapped with bank wrappers); three fraudulently obtained Treasury checks; a ledger containing hundreds of names and Social Security numbers; and stolen identities that had been provided by Brown.
In total, Hamdan facilitated the deposit or receipt of $1,168,858.11 in fraudulently obtained tax refunds. The government has also identified more than 400 victims whose identities were stolen during the course of Hamdan’s activities.
The co-conspirators in this case were previously prosecuted and sentenced. In July 2014, Hicham El Faoutih was sentenced to 15 months in federal prison. Nedal Ahmad was sentenced to 51 months in federal prison in June 2013. In June 2012, Ocala Police officer Dana Brown was sentenced to six years and five months in federal prison. In December 2011, Riad Sulaiman was sentenced in the Southern District of Florida to 41 months in federal prison. In August 2013, Khaldoun Khalil Khawaja was sentenced in the Western District of Virginia to 70 months in federal prison; this sentence is being served concurrent to a 37-month sentence imposed in April 2012 in the Middle District of Florida case.
This case was investigated by the United States Secret Service, the Internal Revenue Service Criminal Investigation Division, the Federal Bureau of Investigation and the Pasco County Sheriff’s Office. It was prosecuted by Assistant United States Attorney Mandy Riedel.
Florida Man Sentenced to 27 Months in Prison for Possession of Child PornographyRead the Press Release
WASHINGTON – David Mario Riley, 38, of Tampa, Fla., was sentenced today to 27 months in prison for possession of child pornography, announced U.S. Attorney Ronald C. Machen Jr., Andrew G. McCabe, Assistant Director in Charge of the FBI’s Washington Field Office, and Cathy L. Lanier, Chief of the Metropolitan Police Department (MPD).
Riley pled guilty to the charge in July 2014 in the U.S. District Court for the District of Columbia. He was sentenced by the Honorable Christopher R. Cooper. Upon completion of his prison term, Riley will be placed on 10 years of supervised release. He also must register as a sex offender for 15 years.
According to the government's evidence, on Dec. 10, 2013, Riley contacted an undercover officer with the FBI's Child Exploitation Task Force, who had posted an ad on a social network site. Over the next few days, Riley engaged in e-mail and instant message conversations with the undercover officer about child pornography and a shared sexual interest in children. During their communications, Riley sent the undercover officer eight still images of child pornography.
Pursuant to a search of electronic equipment in Riley’s hotel room in Crystal City, Va., law enforcement recovered about 14 videos and 40 still images of child pornography.
This case was brought as part of the Department of Justice's Project Safe Childhood initiative and investigated by the FBI's Child Exploitation Task Force, which includes members of the FBI's Washington Field Office and MPD. In February 2006, the Attorney General created Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the U.S. Attorney's Offices, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
In announcing the sentence, U.S. Attorney Machen, Assistant Director in Charge McCabe, and Chief Lanier praised the work of the MPD Detectives and Special Agents of the FBI Child Exploitation Task Force. They also commended the efforts of Assistant U.S. Attorney Ari Redbord, who prosecuted the case.
14-253Five Florida Residents Plead Guilty for Roles in $6 Million Miami Home Health Care Fraud SchemeRead the Press Release
Five South Florida residents pleaded guilty this week in connection with a long-running $6.2 million Medicare fraud scheme involving Professional Medical Home Health LLC (Professional Home Health), a Miami home health care agency that purported to provide home health and therapy services. Two of the defendants also pleaded guilty in connection with their conduct in similar schemes at other Miami home health care agencies.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office and Special Agent in Charge Derrick Jackson of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office made the announcement.
Dennis Hernandez, 32, of Miami, pleaded guilty to one count of conspiracy to commit health care fraud, and Juan Valdes, 37, of Palm Springs, Florida, pleaded guilty to one count of conspiracy to defraud the United States and receive health care kickbacks before U.S. Magistrate Judge Chris M. McAliley of the Southern District of Florida on Nov. 10. 2014. Jose Alvarez, 48, and Joel San Pedro, 44, both of Miami, and Alina Hernandez, 38, of West Palm Beach, Florida, each pleaded guilty to one count of conspiracy to commit health care fraud on Nov. 13, 2014 before Judge McAliley. Sentencing hearings are set for Jan. 29, 2015.
According to admissions in their plea agreements, Dennis Hernandez, San Pedro and Alvarez held positions of influence at Professional Home Health, including those of owner/operator and manager/supervisor. Through Professional Home Health, they billed the Medicare program for expensive physical therapy and home health services that were not medically necessary or were not provided. The three defendants admitted that they and their co-conspirators coordinated the submission of fraudulent claims at Professional Home Health, and falsified patient documentation to make it appear that Medicare beneficiaries qualified for and received home health services that were, in fact, not medically necessary or not provided.
Additionally, each of the five defendants admitted to being patient recruiters for Professional Home Health. In this role, they solicited and received kickbacks and bribes from other co-conspirators at Professional Home Health in exchange for recruiting beneficiaries who neither needed, nor, in some cases, received services.
Dennis Hernandez and Alvarez also admitted to participating in similar criminal conduct at additional Miami-area home health agencies.
From December 2008 through February 2014, Medicare paid Professional Home Health more than $6.2 million for these fraudulent home health claims.
Earlier this year, two other individuals pleaded guilty and were sentenced in connection with the same scheme. Annarella Garcia, an owner of Professional Home Health, was sentenced to serve 70 months in prison. Annilet Dominguez, an administrator of Professional Home Health, was sentenced to serve 68 months in prison. Both were also ordered to pay $6,257,142 million in restitution.
This case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. This case is being prosecuted by Trial Attorney Anne P. McNamara of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
Five Florida Residents Plead Guilty for Roles in $6 Million Miami Home Health Care Fraud SchemeRead the Press Release
Five South Florida residents pleaded guilty this week in connection with a long-running $6.2 million Medicare fraud scheme involving Professional Medical Home Health LLC (Professional Home Health), a Miami home health care agency that purported to provide home health and therapy services. Two of the defendants also pleaded guilty in connection with their conduct in similar schemes at other Miami home health care agencies.
U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office and Special Agent in Charge Derrick Jackson of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office made the announcement.
Dennis Hernandez, 32, of Miami, pleaded guilty to one count of conspiracy to commit health care fraud, and Juan Valdes, 37, of Palm Springs, Florida, pleaded guilty to one count of conspiracy to defraud the United States and receive health care kickbacks before U.S. Magistrate Judge Chris M. McAliley of the Southern District of Florida on Nov. 10. 2014. Jose Alvarez, 48, and Joel San Pedro, 44, both of Miami, and Alina Hernandez, 38, of West Palm Beach, Florida, each pleaded guilty to one count of conspiracy to commit health care fraud on Nov. 13, 2014 before Judge McAliley. Sentencing hearings are set for Jan. 29, 2015.
According to admissions in their plea agreements, Dennis Hernandez, San Pedro and Alvarez held positions of influence at Professional Home Health, including those of owner/operator and manager/supervisor. Through Professional Home Health, they billed the Medicare program for expensive physical therapy and home health services that were not medically necessary or were not provided. The three defendants admitted that they and their co-conspirators coordinated the submission of fraudulent claims at Professional Home Health, and falsified patient documentation to make it appear that Medicare beneficiaries qualified for and received home health services that were, in fact, not medically necessary or not provided.
Additionally, each of the five defendants admitted to being patient recruiters for Professional Home Health. In this role, they solicited and received kickbacks and bribes from other co-conspirators at Professional Home Health in exchange for recruiting beneficiaries who neither needed, nor, in some cases, received services.
Dennis Hernandez and Alvarez also admitted to participating in similar criminal conduct at additional Miami-area home health agencies.
From December 2008 through February 2014, Medicare paid Professional Home Health more than $6.2 million for these fraudulent home health claims.
Earlier this year, two other individuals pleaded guilty and were sentenced in connection with the same scheme. Annarella Garcia, an owner of Professional Home Health, was sentenced to serve 70 months in prison. Annilet Dominguez, an administrator of Professional Home Health, was sentenced to serve 68 months in prison. Both were also ordered to pay $6,257,142 million in restitution.
This case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. This case is being prosecuted by Trial Attorney Anne P. McNamara of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
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.
Essex County Corrections Officer Charged with Taking Bribes to Smuggle Contraband into Federal Pretrial Detention FacilityRead the Press Release
NEWARK, N.J. – An Essex County corrections officer was arrested today by special agents of the FBI for taking bribes to smuggle contraband, including cell phones and cigarettes, into the Essex County Jail, a federal pretrial detention facility, U.S. Attorney Paul J. Fishman announced.
John Grosso, 41, of Belleville, New Jersey, was arrested this morning at the Essex County Jail. He is charged by complaint with one count of conspiring to commit extortion under color of official right, in violation of the Hobbs Act. He appeared this afternoon before U.S. Magistrate Judge Cathy L. Waldor in Newark federal court and was released on $100,000 bail.
According to the complaint:
On multiple occasions between November 2013 and December 2013, Grosso, a corrections officer at the Essex County Jail, accepted cash bribes of approximately $1,000 in return for smuggling cell phones and cigarettes to an inmate. Grosso usually met with the inmate’s associate in the parking lot of the Best Buy store in Secaucus, New Jersey, to accept the contraband packages and cash bribes, before delivering the packages to the inmate.
Conspiring to commit extortion under color of official right, in violation of the Hobbs Act, carries a maximum potential penalty of 20 years in prison and a $250,000 fine.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark, and the Internal Affairs Division of Essex County Correctional Facility, under the leadership of Warden Roy Hendricks, with the investigation.
The government is represented by Assistant U.S. Attorneys Rahul Agarwal of the U.S. Attorney’s Office Special Prosecutions Division and Rob Frazer of the Criminal Division, Organized Crime/Gangs Unit, in Newark.
The charge and allegations contained in the complaint are merely accusations and the defendant is considered innocent unless and until proven guilty
14-397
Defense counsel: Elizabeth H. Smith Esq., Mendham, New Jersey.Grosso, John Complaint
Eastlake Man Faces Child Pornography ChargesRead the Press Release
David M. Moyer, 69, of Eastlake, was charged with receiving and possessing visual depictions of minors engaged in sexually explicit conduct, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
From on or about July 30, 1998, through on or about May 21, 2012, Moyer knowingly received by computer, numerous computer files, which contained visual depictions of real minors engaged in sexually explicit conduct. On October 30, 2013, images of child pornography were also found on his DVD/CD’s, flash memory devices, computers, and external hard drives, according to the indictment.
If convicted, the sentence in this case will be determined by the court after consideration of the Federal Sentencing Guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant United States Attorney Carol M. Skutnik. The case was investigated by the United States Postal Inspection Service in Cleveland
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
District Man Sentenced to Two Years in Prison for Sexually Assaulting His WifeDefendant Shocked Spouse with TaserRead the Press Release
WASHINGTON – A 49-year-old man, of Washington, D.C., was sentenced today to two years in prison for a recent attack in which he shocked his wife with a Taser at their apartment, U.S. Attorney Ronald C. Machen Jr. announced.
The man, who is not identified here to protect the privacy of the victim, pled guilty in September 2014 in the Superior Court of the District of Columbia to a charge of aggravated assault. He was sentenced by the Honorable Russell F. Canan. Upon completion of his prison term, the man will be placed on three years of supervised release. During this time, he will be supervised by the Sex Offender Unit of the Court Services and Offender Supervision Agency.
According to the government’s evidence, on Aug. 3, 2014, the defendant became angry with his wife and began shocking her with a Taser, knocking her to her knees in the bedroom of their Southeast Washington apartment. He then pushed her onto the floor, sat on her chest and continued shocking her face and head. When her head began swelling up, the defendant left the room to get ice and a towel. Upon returning to the bedroom, he discovered that she was trying to crawl away. He then went to another room, retrieved a baseball bat, and began striking her in the head. He pulled the victim to her feet and began punching her in the face. Finally, he ordered the victim onto her bed, where he sexually assaulted her.
The victim suffered multiple injuries, including a fractured cheek. She pleaded with her husband to call an ambulance. Fearing that she’d report what he’d just done, he refused to do so. After the victim promised not to tell on him, he agreed to drive her to the hospital. At the hospital, when the defendant stepped away briefly, the victim reported what he had done to her. An officer with the Metropolitan Police Department, who was at the hospital on another matter, was notified and the defendant was arrested.
In announcing the sentence, U.S. Attorney Machen praised the work of members of the Metropolitan Police Department’s Sexual Assault Unit. He also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialist D’Yvonne Key and Victim/Witness Advocate Veronica Vaughan. Finally, he commended Assistant U.S. Attorney Peter V. Taylor, who investigated and prosecuted this case.
14-252District Man Found Guilty of Numerous Felony Charges in Two Home Invasions in Northeast Washington-Defendant Sexually Assaulted A Woman in One of the Burglaries-Read the Press Release
WASHINGTON – Tavon Barber, 19, of Washington, D.C., was found guilty by a jury today of charges stemming from a pair of home invasions he committed within a roughly 20-hour period in Northeast Washington, including one in which he sexually assaulted a woman, U.S. Attorney Ronald C. Machen Jr. announced.
Barber was found guilty following a trial in the Superior Court of the District of Columbia of a total of 21 counts, including first-degree burglary, first-degree burglary while armed, assault with intent to commit first-degree sexual abuse while armed, three counts of third-degree sexual abuse while armed, three counts of assault with a dangerous weapon, and related offenses. The Honorable Russell F. Canan scheduled sentencing for Feb. 5, 2015.
According to the government’s evidence at trial, on June 4, 2013, between 9 a.m. and 11 a.m., Barber broke into a home in the 1100 block of 6th Street NE through an unlocked kitchen window. At the time, two people were inside the house asleep. Once inside, Barber stole two laptops, a book bag full of stuff and car keys. He then used the car keys to steal the car, which belonged to one of the residents.
Approximately 20 hours later, at approximately 4:30 a.m., Barber and an accomplice broke into a home in the 2400 block of Second Street NE, armed with a loaded .40-caliber, semi-automatic pistol. Wearing something to conceal their faces, they went upstairs to the bedroom where the owners of the home, a husband and wife, were sleeping.
Barber turned on the lights and woke the homeowners from sleep. He demanded money, and told them to put their heads under their pillows. Barber then sexually assaulted the wife, while holding the husband hostage at gunpoint. As Barber sexually assaulted the wife, the husband lunged at him, enabling his wife to escape. Barber and the husband struggled from the second floor, down the stairs to the back of the house. Once there, Barber fired a shot at the husband’s head and then fled, with his accomplice, out the back of the house.
Barber was arrested on June 29, 2013 and has been in custody ever since. The second man earlier pled guilty to charges in the case.
In announcing the verdict, U.S. Attorney Machen commended the work of those who investigated the case from the Metropolitan Police Department (MPD). He also expressed appreciation for the work of those who handled the case for the U.S. Attorney’s Office, including Michael Ambrosino, Special Counsel for DNA and Forensic Evidence Litigation; Paralegal Specialists Jason Manuel and Benjamin Kagan-Guthrie; Victim/Witness Advocate Veronica Vaughan; Victim/Witness Security Specialists Katina Adams-Washington, David Foster, and Wanda Queen, and Litigation Technology Specialist Thomas R. Royal. Finally, he commended the work of Assistant U.S. Attorneys Sharon Donovan and Lindsay Suttenberg, who investigated and prosecuted the case.
14-255District Court Enters Permanent Injunction Against California Dietary Supplement Company and Chief Executive Officer to Stop Distribution of Adulterated ProductsRead the Press Release
The U.S. District Court for the Central District of California entered a consent decree of permanent injunction against Scilabs Nutraceuticals Inc. of Irvine, California, and its board chairman and chief executive officer (CEO), Paul P. Edalat, to prevent the distribution of adulterated dietary supplements, the Department of Justice announced today.
SciLabs Nutraceuticals Inc. is a contract manufacturer of dietary supplements distributed under the brand name All Pro Science, including Complete Immune + capsules and various flavored powders called Complete, Recovery and Precharge. The department filed a complaint in the U.S. District Court for the Central District of California at the request of the U.S. Food and Drug Administration (FDA), alleging that the company’s dietary supplements are manufactured under conditions that are inadequate to ensure the quality of its products.
In conjunction with the filing of the complaint, the defendants agreed to settle the litigation and be bound by a consent decree of permanent injunction that prohibits them from committing violations of the Federal Food, Drug, and Cosmetic Act. The consent decree requires the dietary supplement manufacturer to cease all operations and requires that, in order for defendants to resume manufacturing dietary supplements, the FDA first must determine that Scilabs’ manufacturing practices have come into compliance with the law.
“The failure to comply with current good manufacturing practice requirements by a maker of dietary supplements can pose a risk to the public health,” said Acting Assistant Attorney General Joyce R. Branda of the Justice Department’s Civil Division. “The Department of Justice will continue to bring enforcement actions against those who do not follow the necessary procedures to comply with the safety laws for dietary supplements.”
According to the complaint, FDA inspections performed in 2012, 2013 and 2014 revealed that the company’s dietary supplements are adulterated within the meaning of the Food, Drug, and Cosmetic Act. The complaint alleges, for example, that the company failed to conduct at least one appropriate test or examination to verify the identity of every dietary ingredient before using them. The complaint also alleges that the company failed to establish product specifications for the identity, purity, strength and composition of finished batches of dietary supplements. In addition, as alleged in the complaint, defendants failed to document equipment use, maintenance, cleaning and sanitization in individual equipment logs as required by law.
The government is represented by Trial Attorney Heide L. Herrmann of the Civil Division’s Consumer Protection Branch, with the assistance of Senior Counsel Claudia Zuckerman of the Food and Drug Division of the U.S. Department of Health and Human Services’ Office of General Counsel.
Destrehan Businesswoman, Sandy Isaac-holden, Sentenced for Tax EvasionRead the Press Release
U.S. Attorney Kenneth A. Polite announced that SANDY ISAAC-HOLDEN, age 53, of Destrehan, Louisiana, was sentenced today for one count of tax evasion.
United States District Court Judge Ivan L.R. Lemelle sentenced ISAAC-HOLDEN to serve 48 months of probation and was ordered her to pay $384,712.27 in restitution to the Internal Revenue Service for taxes due and owing.
According to court documents, ISAAC-HOLDEN received unreported income for tax year 2010. The income was received from a contract that existed between two companies, Company “A” and Company “B.” Company “A” manufactures and markets retail products and Company “B” has a maintenance service contract with Company “A.” ISAAC-HOLDEN had been employed as the on-site manager for by Company “B.” Her job responsibilities included managing the Company “B” staff, interacting with Company “A” managers, and retaining subcontractors for work that was outside the scope of work set forth in the contract between Companies “A” and “B.”
ISAAC-HOLDEN received invoices from subcontractors and paid subcontractors (“G & M”) directly. She often awarded this out-of-scope work to G&M Services, LLC. She concealed the fact that she was actually the sole owner and operator of G&M, which sometimes provided these outside the scope of work services such as grass cutting, painting, and cleaning to Company “A.” She hid her interest in G&M by listing her sister’s post office box, as the address for G&M on all of the invoices to Company “B.” ISAAC-HOLDEN also stated to the owners of Company “B” that G&M was owned and operated by “Mr. G” and operated by a man named “Robert.” She also submitted false Forms W-9 (request for taxpayer identification number and certification) in order to conceal from the IRS that she was the person actually earning the income. These forms were submitted in 2009 and 2010 and contained the forged signature of another person.
On April 24, 2011, ISAAC-HOLDEN signed, and placed into the mail for filing with the Internal Revenue Service, a false 2010 Form 1040 tax return which stated that her income for the 2010 calendar year was the sum of $57,466, and that she was owed a refund in the sum of $4,564. However, she knew that her taxable income for the 2010 calendar year was the sum of $455,230. She therefore owed income tax in the amount of $163,083.66, rather than a refund.
U.S. Attorney Polite praised the work of the Internal Revenue Service in investigating this matter. Assistant United States Attorneys Jon Maestri and Andre Lagarde are in charge of this prosecution.
Cottage Grove Woman Indicted for Producing Pornographic Photos of A ChildRead the Press Release
United States Attorney Andrew M. Luger today announced a federal indictment charging ROXANNE MERRELL, 35, of Cottage Grove, Minn., with producing pornographic images of a child. MERRELL is charged with two counts of Production of Child Pornography. The defendant appeared in United States District Court in Minneapolis, Minn., earlier today.
According to the indictment and documents filed in court, MERRELL was offered $100,000 to take photos depicting a minor “below the waist” and nude, which she took while the child was sleeping. The photographs were discovered in North Dakota on the computer of a known sex- offender. MERRELL’S hands appeared in at least one such photograph, and she was identified as the producer and sender of the images.
“HSI is committed to aggressively pursuing those individuals suspected of trading in child pornography,” said HSI St. Paul Special Agent in Charge J. Michael Netherland. "It is our job to do everything that we can to protect the most vulnerable members of our society.”
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Department of Justice Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.projectsafechildhood.gov
This case is the result of an investigation conducted by Homeland Security Investigations (HSI) and the Cottage Grove Police Department.
Assistant U.S. Attorney Katharine T. Buzicky is prosecuting the case.
Defendant Information:
ROXANNE MERRELL, 35
Cottage Grove, Minn.
Charges:
• Production of Child Pornography, 2 counts###
The charges contained in the indictment are merely accusations, and the defendants is presumed innocent unless and until proven guilty.
Cleveland Man Faces Heroin and Firearms ChargesRead the Press Release
A Cleveland man was indicted on federal drug and firearms charges, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Lionel D. Cannon, 50, was indicted on one count each of possession with intent to distribute heroin, being a felon in possession of a firearm and interstate travel for the purpose of facilitating an unlawful activity.
Cannon possessed more than 136 grams of heroin on Aug. 19. He also possessed a .380-caliber revolver and a .44-caliber revolver, despite previous cocaine convictions in state and federal court, according to the indictment.
Cannon also travelled between Ohio and California in August to engage in distribution of cocaine, according to the indictment.
If convicted, the sentence in this case will be determined by the court after consideration of the Federal Sentencing Guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant U.S. Attorney Joseph M. Pinjuh and Special Assistant U.S. Attorney Margaret Tomaro of the Ohio Attorney General's Office.
The case was investigated by the Northern Ohio Law Enforcement Task Force. The NOLETF is a long standing multi-agency task force comprised of investigators from the Federal Bureau of Investigation, Cuyahoga Metropolitan Housing Authority, Drug Enforcement Administration, Internal Revenue Service, Ohio Bureau of Criminal Investigation, U.S. Coast Guard Investigative Service, Cleveland Division of Police, Cleveland Heights Police Department, Cuyahoga County Sheriff’s Office, Euclid Police Department, Regional Transit Authority Police Department, Westlake Police Department, and Shaker Heights Police Department. The NOLETF is also one of the initial Ohio High Intensity Drug Trafficking Area (HIDTA) initiatives. HIDTA supports and helps coordinate numerous Ohio drug task forces in their efforts to eliminate or reduce drug trafficking in Ohio.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Cleveland Man Faces Heroin and Firearms ChargesRead the Press Release
A two-count indictment was filed charging a Cleveland man with possesion of heroin with intent to distibute and being a felon in possession of a firearm, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Dwight Bullard, 40, had more than 140 grams of heroin on Oct. 28, 2014. He also had a Glock 23 .40-caliber pistol and ammunition despite previous felony convictions in Cuyahoga County Common Pleas Court, according to the indictment.
Prosecutors are seeking to forfeit $24,329 in cash that was seized, according to the indictment.
If convicted, the sentence in this case will be determined by the court after consideration of the Federal Sentencing Guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant United States Attorney Henry F. DeBaggis. The case was investigated by the Northern Ohio Law Enforcement Task Force. The NOLETF is a long standing multi-agency task force comprised of investigators from the Federal Bureau of Investigation, Cuyahoga Metropolitan Housing Authority, Drug Enforcement Administration, Internal Revenue Service, Ohio Bureau of Criminal Investigation, U.S. Coast Guard Investigative Service, Cleveland Division of Police, Cleveland Heights Police Department, Cuyahoga County Sheriff’s Office, Euclid Police Department, Regional Transit Authority Police Department, Westlake Police Department, and Shaker Heights Police Department. The NOLETF is also one of the initial Ohio High Intensity Drug Trafficking Area (HIDTA) initiatives. HIDTA supports and helps coordinate numerous Ohio drug task forces in their efforts to eliminate or reduce drug trafficking in Ohio.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Clarks Summit Man Sentenced to 15 Years in Prison for Producing Child PornographyRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a 20-year-old Clarks Summit man was sentenced today in Scranton by Senior U.S. District Court Judge James M. Munley to serve 15 years in federal prison for producing child pornography.
According to United States Attorney Peter Smith, the defendant, Taylor Bzdyr, previously pleaded guilty to using a computer and a cell phone to persuade a 13-year-old female from Canada to engage in sexual acts which were transmitted live via Skype. Bzdry committed the offense between October 2012 and October 2013.
Bzdyr was indicted by a federal grand jury sitting in Scranton in March 2014, as a result of an investigation by the Federal Bureau of Investigation, Border Patrol Agents in California, and the New Westminster Police Department in British Columbia, Canada.
Judge Munley also ordered Bzdyr to be placed on supervised release for life following his prison sentence. Bzdyr must also register as a sex offender and comply with sex offender notification requirements and restrictions.
The case was prosecuted by Assistant U.S. Attorney Francis P. Sempa.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."