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Tuesday 28 October 2014
Justice Department Protects Eastern District of Texas Election ProcessRead the Press Release
Department of Justice
Office of Public AffairsBEAUMONT, Texas – U.S. Attorney John M. Bales announced today that Assistant U.S. Attorneys in the Eastern District of Texas have been appointed as District Election Officers (DEOs) for the upcoming Nov. 4, 2014 general election. The DEOs will be responsible for overseeing the District’s handling of complaints of election fraud and voting rights abuses in consultation with Justice Department Headquarters in Washington, D.C.
U.S. Attorney Bales said, “Every citizen must be able to vote without interference or discrimination and to have that vote counted without it being stolen because of fraud. The Department of Justice will act promptly and aggressively to protect the integrity of the elction process.”
The Department of Justice has an important role in deterring election fraud and discrimination at the polls, and combating these violations whenever and wherever they occur. The Department’s long-standing Election Day Program furthers these goals, and also seeks to ensure public confidence in the integrity of the election process by providing local points of contact within the Department for the public to report possible election fraud and voting rights violations while the polls are open on election day.
Federal law protects against such crimes as intimidating or bribing voters, buying and selling votes, impersonating voters, altering vote tallies, stuffing ballot boxes, and marking ballots for voters against their wishes or without their input. It also contains special protections for the rights of voters and provides that they can vote free from acts that intimidate or harass them. For example, actions of persons designed to interrupt or intimidate voters at polling places by questioning or challenging them, or by photographing or videotaping them, under the pretext that these are actions to uncover illegal voting may violate federal voting rights law. Further, federal law protects the right of voters to mark their own ballot or to be assisted by a person of their choice.
The franchise is the cornerstone of American democracy. We all must ensure that those who are entitled to the franchise exercise it if they choose, and that those who seek to corrupt it are brought to justice. In order to respond to complaints of election fraud or voting rights abuses on Nov. 4, 2014, and to ensure that such complaints are directed to the appropriate authorities, U.S. Attorney Bales stated that Assistant U.S. Attorneys/ District Election Officers Michelle Englade, Tom Gibson, and M. Andrew Stover will be on duty in the Eastern District of Texas while the polls are open. AUSA Englade can be reached by the public in Beaumont at 409-839-2538, AUSA Gibson can be reached in Tyler, Texas at 903-590-1400, and AUSA Stover can be reached in Plano, Texas at 972-509-1201.
In addition, the FBI will have Special Agents available in each Field Office and Resident Agency throughout the country to receive allegations of election fraud and other election abuses on election day. The FBI can be reached by the public in the Eastern District of Texas at the following telephone numbers:
Beaumont – 409-832-8571
Frisco – 214-705-7000
Lufkin – 936-637-3834
Sherman – 903-892-8754
Texarkana – 870-773-3382
Tyler – 903-592-4301Complaints about ballot access problems or discrimination can be made directly to the Civil Rights Division’s Voting Section in Washington, D.C. at 1-800-253-3931 or (202)307-2767 or by email to [email protected] or by complaint form at http://www.justice.gov/crt/complaint/votintake/index.php.
U.S. Attorney Bales said, “Ensuring free and fair elections depends in large part on the cooperation of the American electorate. It is imperative that those who have specific information about discrimination or election fraud make that information available immediately to my Office, the FBI, or the Civil Rights Division.”Judge Sentences Defendants in West Philly Multi-milion Dollar Mortgage Fraud SchemeRead the Press Release
PHILADELPHIA – Defendants in a mortgage fraud conspiracy involving KREW Settlement Services were sentenced today by U.S. District Court Judge Berle M. Schiller for their roles in the multi-million dollar scheme involving more than 100 fraudulent mortgage loans. Eric Sijohn Brown, 46, of Philadelphia, was sentenced to 180 months in prison and was ordered to pay $10,849,873 in restitution to the lenders; Kevin Joseph Franklin, 51, of Albany, Georgia, was sentenced to 139 months in prison and was ordered to pay $9,454,607 in restitution to the lenders; Roderick L. Foxworth, Sr., 57, of Philadelphia, was sentenced to 84 months in prison and was ordered to pay $2,701,868 in restitution to the lenders. For false filing of tax returns, Brown was also ordered to pay restitution to the IRS in the amount of $209,777, plus interest and penalties; Franklin was ordered to pay restitution to the IRS in the amount of $51,622, plus interest and penalties; and Foxworth was ordered to pay restitution to the IRS in the amount of $140,305, plus interest and penalties. All three defendants pleaded guilty to conspiracy to commit loan fraud, wire fraud, and making false statements. Co-conspirators Walter Brown and Cynthia Brown were convicted at trial. The fraud scheme resulted in more than $20 million in fraudulent loan proceeds.
Eric Sijohn Brown - a general contractor - worked with other co-conspirators to identify distressed properties to purchase, typically in the West Philadelphia area. The scheme involved recruiting “straw buyers” whose credit history and personal information was used to purchase the properties, obtain mortgage loans, and take title to the properties, when, in reality, the properties were owned and controlled by the defendants. Mortgage loan applications were then prepared in the names of the straw buyers containing a host of false information, including false purchase prices, false employment and income information, and false statements about the straw buyers living in the properties. Mortgage brokers - including Roderick Foxworth and Walter Brown - submitted the fraudulent loan applications to lenders to secure the loans for the buyers, knowing that the information was false. Cynthia Evette Brown falsely verified that many of the straw buyers worked for her employer, Unicco Service Company, when they did not. Kevin Joseph Franklin, a title agent, falsely prepared two deeds and settlement statements (referred to as "Form HUD-1") – one for the seller that showed the actual agreed-upon purchase price and a false one for the lender that showed the grossly inflated purchase price. Franklin also created false title insurance policies for the lenders.
After the loans funded, the seller was paid the agreed-upon purchase price, and the difference between the actual purchase price and the false purchase price quoted to the lender was shared with and distributed by Franklin to Eric Brown, Foxworth, Walter Brown, and Cynthia Brown, and many of these payments were not reflected on the HUD-1 forms.
Eric Brown pleaded guilty on April 8, 2014; Franklin and Foxworth pleaded guilty on April 9, 2014.
The case was investigated by the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigation, and the Department of Housing and Urban Development’s Office of Inspector General. It is being prosecuted by Assistant United States Attorney Michael S. Lowe.UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Johnstown Heroin Dealer Sentenced to 90 Months in Federal PrisonRead the Press Release
JOHNSTOWN, Pa. - A Cambrian County resident has been sentenced in federal court to 90 months in prison and three years supervised release on his conviction of distributing heroin, United States Attorney David J. Hickton announced today.
United States District Judge Kim R. Gibson imposed the sentence on Damian C. Jeffers, Sr., 44, of Johnstown, Pa.
According to information presented to the court, on Jan. 7, 2013, Jeffers distributed less than 100 grams of heroin.
Assistant U.S. Attorney Stephanie L. Haines prosecuted this case on behalf of the government.
Mr. Hickton commended the Laurel Highlands Resident Agency of the Federal Bureau of Investigation, the Cambria County Drug Task Force and the Johnstown Police Department for the investigation leading to the successful prosecution of Jeffers.
Information: Federal Court ArraignmentsRead the Press Release
The United States Attorney's Office announced that those persons listed below were arraigned before the U.S. Magistrate and the indictments handed down by the Grand Jury unsealed.
Appearing before U.S. Magistrate Judge Strong in Great Falls on October 28, 2014, and entering pleas of Not Guilty were:
JHANE ALAM, a 38-year-old resident of Bangladesh, appeared on charges of transporting illegal aliens, encouraging and inducing illegal entry, and bringing aliens to the United States. If convicted of the most serious charges contained in the indictment, ALAM, faces 5 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by Homeland Security Investigations. PACER Case Reference: 14-94
JASON NEEL, a 31-year-old resident of California, appeared on charges of witness tampering. If convicted of the charge contained in the indictment, NEEL, faces 20 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the Federal Bureau of Investigation. PACER Case Reference: 14-100
ANTONIO MATHIAS PETERSON, a 32-year-old resident of Butte, appeared on charges of felon in possession of a firearm. If convicted of the charge contained in the indictment, PETERSON, faces 10 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the United States Probation Office.. PACER Case Reference: 14-07
If any of the above cases are of interest to your media organization and the community it serves, we encourage you to monitor the progress of the case regularly through the U.S. District Court calendar and the PACER system so that you stay current and not miss any important developments in the case.
To establish a PACER account, which will allow you to review documents filed in the case, please go to, http://www.pacer.gov/register.html. To access the district court's calendar, please go to https://ecf.mtd.uscourts.gov/cgi-bin/PublicCalendar.pl.
Idaho Resident Pleads Guilty to Possession with Intent to Distribute Bath SaltRead the Press Release
BOISE - Brent R. Heinrich, 41, of Boise, Idaho, pleaded guilty today in United States District Court to possession with intent to distribute 300 grams of a mixture and substance containing the controlled substance analogue alpha-pyrrolidinopentiophenone (“a-PVP”), more commonly known as “bath salts,” which were intended for human consumption, U.S. Attorney Wendy J. Olson announced.
According to the plea agreement, Heinrich ordered the a-PVP from China and had it mailed to Idaho using a false name and address. Federal investigators were alerted that this package, which was deemed suspicious, was on its way to Idaho. They had the package routed by FedEx to Boise, and they told the Boise FedEx facility that the package might contain a hazardous chemical. When FedEx received the package, they inspected the contents and found two baggies, one that held a powdery substance and one that contained a crystalline substance. A special agent from Homeland Security Investigations and a detective from Idaho State Police went to the FedEx facility to inspect and test the contents of the package. The officers determined that both of the baggies contained a controlled substance analogue called a-PVP, also known as bath salts.
When Heinrich picked up the package at the FedEx facility, he signed for it using the false name and address that was on the package. Heinrich was arrested, in possession of the bath salts, shortly after he left the FedEx facility. Further investigation by the Idaho State Police showed that Heinrich, himself a heavy user of bath salts, intended to sell the bath salts for others to consume. The controlled substance analogue, a-PVP, shares a similar chemical structure with a Schedule I controlled substance MDPV, also known as bath salts. A-PVP is considered a controlled substance analogue because it produces both hallucinogenic and stimulant effects on the central nervous system that are similar to, or greater than those caused by the controlled substance MDPV.
The charge carries a maximum punishment of up to 20 years in prison, a fine of up to $1,000,000, and a minimum term of three years of supervised release.
Sentencing is scheduled for January 14, 2015, before U.S. District Judge Edward J. Lodge in Boise.
The case was investigated by the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations and the Idaho State Police.
- Houston Man Gets Almost Nine Years for Possessing Counterfeit Credit Cards
Hollister Woman Sentenced to Prison for Embezzlement SchemeRead the Press Release
SAN JOSE – Briana Irene Roy was sentenced today to nine months in prison, and ordered to pay $197,240.95 in restitution for wire fraud stemming from an employee embezzlement scheme, announced United States Attorney Melinda Haag and U.S. Secret Service Special Agent in Charge Cristina Beloud.
Roy pleaded guilty on May 29, 2014, to one count of wire fraud. According to the plea agreement, Roy admitted that between March 2010 and February 2013, while she had been employed in the marketing division of a local engineering company based in San Jose, Calif., she devised and implemented a scheme whereby she used a company credit card issued in the name of one of the company’s executives on approximately 80 separate occasions to make charges to her personal PayPal account for her personal benefit. Roy further admitted that she attempted to conceal these activities by generating fake invoices and receipts for products and services in the name of another San Jose business. Through this fraudulent scheme, Roy admitted that she stole or attempted to steal funds to which she was not entitled in the amount of $247,387.45.
Roy, 38, of Hollister, Calif., had previously waived Indictment and was charged by a felony Information on Dec. 13, 2013. She was charged with one count of wire fraud in violation of Title 18 United States Code § 1343. Roy pleaded guilty to the single count and agreed to pay restitution for the full amount of the loss. Roy is currently released on bond. Bail was set previously at $50,000.
The sentence was handed down by the Honorable D. Lowell Jensen, Senior United States District Court Judge. Judge Jensen also sentenced the defendant to a three-year period of supervised release. The defendant will begin serving the sentence on or before Feb. 25, 2015.
Amie Rooney is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Tracey Andersen. The prosecution is the result of an investigation by the U.S. Secret Service.
(Roy information )
Gregory Allen Rhea Sentenced to Serve 288 Months in Prison for Conspiring to Distribute Oxycodone and MethamphetamineRead the Press Release
GREENEVILLE, Tenn. – Gregory Allen Rhea, 38, of Morristown, Tenn., was sentenced on Oct. 27, 2014, by the Honorable J. Ronnie Greer, U.S. District Court Judge, to serve 288 months in federal prison for conspiring to distribute oxycodone and methamphetamine, maintaining a place for the purpose of distributing controlled substances, and possession of firearms in furtherance of drug trafficking.
Upon his release from prison, Rhea will be supervised by the U.S. Probation Office for four years. There is no parole in the federal system. Rhea was also ordered to forfeit to the United States $75,100 and also pay a money judgment in the amount of $1,200,000, which represents the proceeds of his drug trafficking offenses.
In October 2012, Rhea and 11 others were named in an 18-count indictment charging them with drug trafficking of oxycodone, oxymorphone, and methamphetamine, firearms violations, and money laundering. The charges were the result of a lengthy investigation of individuals who traveled to Florida, Tennessee, and Georgia to obtain oxycodone from pain clinics and other illegal drugs to distribute throughout eastern Tennessee. All 12 charged in the indictment have now been convicted and sentenced.
According to his plea agreement, Rhea admitted that he organized trips to pain clinics in Florida and Tennessee to obtain oxycodone to distribute in the Eastern District of Tennessee. He also admitted that he sponsored others to travel to these clinics and, in exchange, received a portion of the oxycodone tablets prescribed to each individual. Additionally, Rhea admitted that he had directed others to travel to Georgia to obtain methamphetamine to distribute in the Eastern District of Tennessee. During the course of the conspiracy, he admitted that he was responsible for obtaining and distributing over 778,000 milligrams of oxycodone (the equivalent of nearly 26,000 dose units of 30 milligram oxycodone tablets) and 45 grams of methamphetamine.
In October 2012, Rhea was arrested at his residence in Morristown where he and co-defendant Johnny Neeley were found barricaded inside a room which contained oxycodone, oxymorphone, and three firearms. Evidence presented at Rhea’s sentencing hearing demonstrated that he continued to direct the activities of others involved in this conspiracy after his arrest by directing another individual to retrieve methamphetamine from his residence and destroy it.
This lengthy investigation was the result of the collaborative efforts of the Tennessee Bureau of Investigation, Morristown Police Department, and Hawkins County Sheriff’s Department. Assistant U.S. Attorney Suzanne Kerney-Quillen represented the United States.
Gardiner Man Pleads Guilty to Pharmacy RobberyRead the Press Release
Contact: F. Todd Lowell
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Jesse
Mansir, 31, of Gardiner, Maine, pleaded guilty today in U.S. District Court in Bangor to
pharmacy robbery.Court records reveal that on August 21, 2014, Mansir entered the Rite Aid Pharmacy in
Gardiner, approached the pharmacy counter and handed a threatening note to a pharmacy
technician. He told the technician that he had a gun and he concealed one of his hands. The
pharmacist gave Mansir two bottles of Oxycodone and he fled.Law enforcement officers located Mansir with the aid of a K9 and recovered one of the
stolen Oxycodone bottles. A Gardiner police officer identified Mansir as the robber after
reviewing surveillance video from the pharmacy. Two of the pharmacy employees also
identified him as the robber from a photo array.Mansir faces up to 20 years in prison, a $250,000 fine and restitution. He will be
sentenced after the completion of a presentence investigation report by the U.S. Probation Office.The investigation was conducted by the Gardiner Police Department, the Maine State
Police, the Kennebec County Sheriff’s Office, and the Federal Bureau of Investigation.Gardiner Man Pleads Guilty to Bank RobberyRead the Press Release
Contact: F. Todd Lowell
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that John C.
Slater, 66, of Gardiner, Maine, pleaded guilty today in U.S. District Court in Bangor to bank
robbery.According to court records, on June 23, 2014, the defendant robbed $15,000 from the
Bank of Maine, in Hallowell, Maine after handing a bank employee a demand note that
read: “Im Here to Rob your Bank, no silent Alarms my cell Phone rings, your all dead, I have a
hand grenade, and a gun, no marked bills, or inked, if so, one day I will come back and kill all of
you, do you understand.???”The ensuing investigation identified the defendant as a suspect. On June 27, 2014, law
enforcement officers executed search warrants at two locations where the defendant had been
living. Those searches revealed evidence that connected the defendant to the bank robbery. On
July 9, 2014, the defendant was arrested in New Hampshire.Slater faces up to 20 years in prison, a $250,000 fine and mandatory restitution. He will
be sentenced after the completion of a presentence investigation report by the U.S. Probation
Office.The investigation was conducted by the Hallowell, Augusta and Gardiner Police
Departments; the Maine State Police; and the Federal Bureau of Investigation.Gambino Crime Family Associate Gennaro Bruno Charged with the 2002 Murder of Martin BosshartRead the Press Release
Earlier today, an indictment was unsealed charging Gennaro “Jerry” Bruno of the Gambino organized crime family of La Cosa Nostra (the “Gambino crime family”) with racketeering and racketeering conspiracy, including predicate acts of murder, narcotics trafficking, extortion and obstruction of justice.1 Bruno was arrested today in Las Vegas, Nevada, where his initial appearance for removal proceedings to the Eastern District of New York is scheduled for later today at the Lloyd D. George United States Courthouse, 333 Las Vegas Boulevard South, Las Vegas, Nevada.
The charges and Bruno’s arrest were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York and George Venizelos, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office.
“As alleged, Gennaro Bruno started his criminal career at a young age as a member of a street gang where he earned his criminal credentials. He then graduated to become an associate in the Gambino crime family, where he proved himself to be both an earner for the family and capable of murder. The arrests and charges announced today are a testament to the tireless pursuit of justice by law enforcement,” stated United States Attorney Lynch. “We will not rest until violent criminals who use their mafia ties to obstruct justice and evade the law are brought to justice.” Ms. Lynch extended her grateful appreciation to the FBI, New York City Police Department and the Queens County District Attorney for their outstanding assistance in this case.
FBI Assistant Director-in-Charge George Venizelos stated, “As alleged, Gennaro “Jerry” Bruno was originally trained as a member of the “Young Guns.” After being released from prison, Bruno was promoted to associate of the Gambino crime family. In January of 2002, Bruno executed Martin Bosshart by shooting him in the back of the head. Bruno was as ruthless as he was calculating, and after a long run of evading justice, Bruno’s gig is up.”
According to the indictment and other court filings, when Bruno was released following a term of imprisonment from approximately 1997 to 2000, he emerged as an associate of the Gambino crime family, having graduated from the local gang of young men referred to as the “Liberty Posse” or the “Young Guns.” Over the next 14 years, before his arrest today, Bruno engaged in a myriad of crimes with and on behalf of a faction of the Gambino crime family aligned with Joseph “JoJo” Corozzo, a powerful Gambino member who had risen to become the consigliere of the family. Bruno and other Gambino crime family members and associates moved large quantities of high-potency marijuana from Canada into the New York City area. In 2001, Bruno’s criminal associate Martin Bosshart began efforts to exclude one of Bruno’s coconspirators from the marijuana importation operation. In an effort to prevent Bosshart from doing so, Bruno plotted with other Gambino crime family members and associates, including Todd LaBarca, to murder Bosshart.2 On the night of January 2, 2002, Bruno and others lured Bosshart to an isolated location in Queens, New York. There, Bruno allegedly shot Bosshart in the back of the head at point-blank range, killing him immediately. The body of Martin Bosshart, who was 30 years old at the time, was recovered at the scene.
Thereafter, Bruno evaded justice for years and conspired with other Gambino associates to obstruct an official grand jury proceeding into the Bosshart murder, while continuing to participate in the core money-making activities of the Gambino crime family, including drug trafficking and extortion. As part of the alleged pattern of racketeering, Bruno, among other things, used his position in the Gambino crime family to extract extortionate payments from the owner of a waste carting company in Queens, New York.
The government’s case is being prosecuted by Assistant United States Attorney M. Kristin Mace.
The Defendant:
GENNARO BRUNO, a/k/a “Jerry”
Age: 41
Las Vegas, Nevada
E.D.N.Y. Docket No. 14-CR-556 (WFK)
___________________________________________________________________________
1 The charges announced today are merely allegations, and the defendant is presumed innocent unless and until proven guilty.
2 On April 26, 2012, fellow Gambino associate Todd LaBarca pleaded guilty in the Southern District of New York to racketeering, with predicate acts of conspiracy to murder Martin Bosshart, narcotics trafficking, extortion and bookmaking, as well as conspiracy to commit assault in aid of racketeering.
Fraudulent Investment Advisor Sentenced to 36 Months in Prison and Ordered to Pay Victims $886,925.62 in RestitutionRead the Press Release
BOWLING GREEN, Ky. – A Bowling Green, Kentucky, resident who fraudulently promoted himself as an investment advisor was sentenced to 36 months in prison and ordered to pay victims $886,925.62 in restitution on October 23, 2014, by U.S. District Judge Joseph H. McKinley Jr., announced David J. Hale, United States Attorney for the Western District of Kentucky.
Paul Carney, age 46, previously pleaded guilty to all charges in a 32 count federal indictment including 20 counts of wire fraud and 12 counts of engaging in monetary transactions in criminally derived property of $10,000 or more (money laundering).
Between 2008 and November 2011, Carney devised a scheme where he represented himself as an investment advisor, who knew a stock trader, who could invest contributions in the stock market and make investors a substantial profit. As a result, at least eight known victims gave Carney hundreds of thousands of dollars to invest. Carney later told at least one investor that millions of dollars in profits had been realized, but additional cash investments were required because the profits would not be released until taxes and various fees had been paid, resulting in significant additional payments by the victim. In reality, there was no stock trader, investments, or profits. Carney’s scheme resulted in the total loss of $886,925.62.
Also, in furtherance of this scheme, Carney cashed personal checks and cashier’s checks ranging in amounts from $18,000 to $80,000 from investors and laundered the money through purchases of official bank checks which he used for his own personal benefit. As part of the plea agreement, Carney will forfeit a 2009 Ford Mustang Shelby GT which he purchased for $49,000 from the investment scheme and forfeit property located at 1253 Larmon Mill Road in Bowling Green, also purchased with illegally derived funds from the investment scheme.
This case was prosecuted by Assistant United States Attorney David Weiser and was investigated by the Internal Revenue Service (IRS) Criminal Investigation division.
Fort Thompson Man Sentenced for Assault Resulting in Substantial Bodily Injury to A SpouseRead the Press Release
United States Attorney Brendan V. Johnson announced that a Fort Thompson, South Dakota, man convicted of Assault Resulting in Substantial Bodily Injury to a Spouse was sentenced on October 27, 2014, by U.S. District Judge Roberto A. Lange.
Arnold Roy Walking Bull, Jr., a/k/a Junior Charging Hawk, age 38, was sentenced to 12 months and a day of custody, 2 years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Walking Bull was indicted by a federal grand jury on June 10, 2014. He pled guilty on July 31, 2014.
The conviction stems from an altercation he had with his spouse on October 1, 2013. Walking Bull assaulted the victim, causing her substantial bodily injury.
This case was investigated by the Bureau of Indian Affairs, Crow Creek Agency. Assistant U.S. Attorney Meghan N. Dilges prosecuted the case.
Walking Bull was immediately turned over to the custody of the U.S. Marshals Service.
Fort Thompson Man Indicted on Assault ChargesRead 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 Assault with a Dangerous Weapon, Assault by Strangulation and Suffocation, and Assault Resulting in Substantial Bodily Injury to an Intimate Partner.
Jared Chase Blaine, age 20, was indicted on September 16, 2014. He appeared before U.S. Magistrate Judge Mark A. Moreno on October 23, 2014, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in custody and/or a $250,000 fine, 3 years of supervised release, and up to $300 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on or about August 12, 2014, Blaine unlawfully assaulted his intimate partner with shod feet, as well as strangled and suffocated the victim, resulting in substantial bodily injury.
The charges are merely accusations and Blaine 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.
Blaine was remanded to the custody of the U.S. Marshals Service pending trial which has been set for December 2, 2014.
Former Schoolteacher & Ponzi Scheme Operator Sentenced to Four Years in PrisonRead the Press Release
CHARLOTTE, N.C. – Today, U.S. District Judge Robert J. Conrad, Jr. sentenced Carl David Wright, 54, of Iron Station, N.C., to serve four years in prison followed by three years of supervised release for stealing more than $1 million from investors, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina. Judge Conrad also ordered Wright to pay $817,975 as restitution to his victim investors.
Thomas L. Noyes, Inspector in Charge of the Charlotte Division of the U.S. Postal Inspection Service (USPIS) and B.W. Colier, Acting Director of the North Carolina State Bureau of Investigation (SBI) join U.S. Attorney Tompkins in making today’s announcement.
According to filed court documents and today’s sentencing hearing, Wright was a schoolteacher who solicited investors to invest more than one million dollars in a Ponzi scheme that Wright claimed was a purported “Commodity Investment Group” based in Cherryville, N.C. From August 2008 through March 2013, Wright told investors that he managed the Commodity Investment Group for the purpose of investing in hedge funds, commodities, and Quick Trip service stores. In reality, Wright invested no victim money in anything resembling hedge funds, commodities, or service stores and diverted most victim money to pay supposed returns to other victim investors, commonly referred to as a Ponzi scheme. According to court documents, Wright diverted other victim money to support his lifestyle. Court records show that Wright often siphoned off a large percentage of victim money in cash immediately upon the initial deposit. Indeed, Wright was known at times to carry a significant amount of cash in a black duffel bag, court records indicate. When the scheme collapsed in 2013, Wright had less than $1,000, causing losses to victims of more than half a million dollars. Wright pleaded guilty in July 2013 to one count of mail fraud.
Following the sentencing hearing, Wright was permitted to remain on bond and will be ordered to report to the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
The investigation was handled by USPIS and SBI. U.S. Attorney Tompkins also thanked the Commodities Futures Trading Commission for their invaluable assistance in this case. Assistant United States Attorney Kurt Meyers of the U.S. Attorney’s Office in Charlotte prosecuted the case.
Former New Hampshire Financial Consultant PleadsRead the Press Release
Guilty To Fraud, Money Laundering And Tax EvasionCONCORD, NEW HAMPSHIRE – Frederick V. McMenimen, III, 53, of Bow, pleaded guilty in United States District Court for the District of New Hampshire to one count of mail fraud, one count of money laundering and three counts of federal income tax evasion, announced United States Attorney John P. Kacavas.
McMenimen admitted that from approximately September 2008, to about October 2011, he fraudulently solicited more than $1 million in purported investments from some of his financial advisory clients. Each of the clients was an elderly widow whose family had long-standing personal relationships with McMenimen’s family.
McMenimen advised each client to liquidate existing annuities or other investments, to deposit the proceeds in their checking accounts and to then write checks payable to APSB.@ In most instances, McMenimen caused the clients to write those checks by falsely leading them to believe that PSB was another investment vehicle that was better for them than their existing annuities. In actuality, PSB was a shorthand reference to a defunct retail sporting goods business, PSB Sports LLC that McMenimen had once owned and operated. Between approximately September 8, 2008, and October 2011, McMenimen fraudulently induced the clients to write twenty-three checks payable to PSB in the aggregate estimated amount of approximately $1.3 million.
McMenimen deposited the checks into a bank account he maintained in the name of PSB. He then used those funds to purchase official bank checks which he directly or indirectly deposited into a checking account maintained in a relative’s name at an FDIC insured financial institution. The relative in whose name the account was maintained provided McMenimen with several books of pre-signed but otherwise blank checks, thereby affording McMenimen complete access to the fraudulently obtained funds.
Despite expending all of the proceeds on personal expenses, McMenimen did not record any of the fraudulently obtained funds as income on the tax returns he filed for tax years 2008, 2009 and 2010. Because McMenimen underreported his income for those tax years, his tax returns reflected a tax due and owing that was substantially less than his true tax liability. McMenimen is scheduled to be sentenced on February 11, 2015.
This case was investigated by the Bedford (N.H.) field of the Federal Bureau of Investigation, the Portsmouth (N.H.) field office of the IRS’s Criminal Investigation division and the Department of Education. The case is being prosecuted by Assistant United States Attorney Bill Morse.
Former Naples CFO Sentenced to Five Years for Mail Fraud and Tax EvasionRead the Press Release
Fort Myers, Florida – U.S. District Judge John E. Steele yesterday sentenced Shawn Fuentes to five years in federal prison for mail fraud and tax evasion. The Court also ordered Fuentes to pay restitution to Naples Concrete and Masonry in the amount of $1,951,459, and to pay restitution to the IRS in the amount of $624,728. As part of her sentence, the court entered a money judgment in the amount of $106,979.14, the proceeds of the mail fraud. Fuentes pleaded guilty on July 17, 2014.
According to court documents, Fuentes was the Chief Financial Officer of N.C.M. of Collier County, Inc., DBA Naples Concrete and Masonry, which was headquartered in Naples, Florida. On numerous occasions between October 2008 and February 2010, Fuentes fraudulently wrote checks payable to American Express and to Bank of America drawn on the bank accounts of N.C.M. of Collier County, Inc., and then sent them by U.S. mail or Federal Express to satisfy her own credit card debt. As part of the scheme, the fraudulent checks appeared to be written for legitimate business expenses in the accounting system utilized by the company, when in truth Fuentes was paying personal expenses. As a result of the scheme, she obtained in excess of $500,000.
In addition, Fuentes filed a 2009 tax return reporting a taxable income of approximately $35,148. She omitted the amount of money defrauded, misappropriated, or stolen from Naples Concrete and Masonry. The actual taxable income that she had received was $822,060; therefore, she failed to report taxable income in the amount of approximately $786,912. For the calendar year 2009, Fuentes paid $2,671 in taxes rather than $262,081.
This case was investigated by the United States Secret Service and the Internal Revenue Service. It was prosecuted by Assistant United States Attorney Yolande G. Viacava.
Former Fugitive Heroin Dealer Sentenced to Nearly Five Years in PrisonRead the Press Release
BIRMINGHAM -- A federal judge today sentenced a Birmingham man and former federal fugitive to four years and nine months in federal prison for dealing heroin, announced U.S. Attorney Joyce White Vance and Drug Enforcement Administration Assistant Special Agent in Charge Clay A. Morris.
U.S. District Judge Abdul K. Kallon sentenced PATROPIUS FOSTER, 35, on one count of conspiracy to distribute heroin in Jefferson County between October 2012 and May 2013. The judge also sentenced Foster for two counts of distributing heroin, once on March 19, 2013, and again on April 17, 2013, and on two counts of using a telephone to facilitate drug trafficking on the March date. Foster pleaded guilty to the charges in July. He has remained in custody since his arrest last year.
Foster was among 49 people indicted in 2013 as part of an ongoing initiative between law enforcement and the U.S. Attorney's Office to attack the supply side of the spiraling heroin problem in north Alabama. Foster remained a fugitive from September 2013, when most of the defendants were arrested, until April 2014 when he was arrested in Atlanta.
Of the 49 people indicted in the 2013 sweep, 40 have pled guilty and one defendant was convicted at trial. Foster brings to 39 the number of those defendants who have been sentenced. One defendant pleaded guilty to selling heroin that caused a death and received a 20-year sentence. The remaining sentences have ranged from probation for first-time offenders to 12 1/2 years for the dealers who qualified as career offenders under the Federal Sentencing Guidelines.
Law enforcement agencies working with DEA in the months-long investigation leading to the 2013 indictments and arrests included the Hoover, Pelham, Gardendale, Vestavia Hills, Tuscaloosa, Hueytown, Bessemer and Pleasant Grove police departments, Marshall County Drug Task Force, Gulf Coast HIDTA Task Force, Alabama Beverage Control Board, Alabama Bureau of Investigation, Jefferson and Shelby County sheriff's offices, and district attorney's offices for Jefferson, Shelby and Tuscaloosa counties and the Bessemer Cutoff. Assistant U.S. Attorney L. James Weil Jr. is prosecuting the cases.
Final Individual in Jacksonville Cocaine Conspiracy and Money Laundering Case Sentenced to More Than 14 Years in Federal PrisonRead the Press Release
Jacksonville, Florida – U.S. District Judge Timothy J. Corrigan has sentenced Larry Andrews (41, Jacksonville) to 14 years and 7 months in federal prison for conspiracy to distribute 5 kilograms or more of cocaine, and conspiracy to commit money laundering. The court also entered a money judgment against Andrews for $98,000, which represents drug proceeds that he laundered through a Jacksonville nightclub. He pleaded guilty on January 22, 2013.
According to court documents, Andrews, Isaiah Bynes, Deangelo Butler, and others participated in a cocaine trafficking conspiracy during which Bynes obtained between 3 and 15 kilograms of cocaine from sources in south Florida and transported the drugs to Andrews and Butler in Jacksonville. Andrews and Butler received the multi-kilograms of cocaine at various places, including on the east side of Jacksonville, and at a dormitory style building that Bynes owned. Andrews and Butler maintained a room at that building to keep cocaine paraphernalia, which was used process the kilograms of cocaine. Andrews sold the cocaine to kilogram level dealers in Jacksonville, primarily those living on the east side. Court documents reveal that Andrews was a long time cocaine dealer on the east side, was involved in drug-related conflicts with other groups in the area, and has been shot on four separate occasions.
Andrews stopped selling cocaine in mid-2010 due to a Jacksonville Sheriff’s Office investigation. He invested $98,000 of drug money into a Gentlemen’s Club that he financed, known as the Vivid Vixen’s Nightclub. At the end of each night, half of the cash generated at the club was delivered to Andrews. The club opened in late 2011 and has since closed.
Andrews was the final individual sentenced in a series of cases related to this conspiracy. Previously, Bynes was sentenced to 14 years and 7 months in federal prison, and Butler was sentenced to 6 years and 3 months in federal prison.
This case was investigated by the Jacksonville Sheriff’s Office. It was prosecuted by Assistant United States Attorney A. Tysen Duva.
Federal Jury Finds Immokalee Man Guilty of Theft of Government Money and Aggravated Identity TheftRead the Press Release
Fort Myers, Florida – United States Attorney A. Lee Bentley, III announces that a federal jury has found Ernest Freeman, Jr. guilty of 11 counts of theft of government money and 11 counts of aggravated identity theft. He faces a maximum penalty of 10 years in federal prison for each count of theft of government money, and a maximum penalty of two years in federal prison for each aggravated identity theft count. His sentencing hearing is scheduled for January 26, 2015. Freeman was indicted on June 12, 2013.
According to testimony and evidence presented at trial, between September 2011 and March 2012, Freeman deposited 11 federal income tax refund checks, issued in the names of other individuals, into his business account. In doing so, he used the means of identification of other individuals to steal more than $100,000 in government money.
This case was investigated by United States Secret Service and the Internal Revenue Service. It is being prosecuted by Assistant United States Attorney Yolande G. Viacava.
Federal Jury Convicts Friend of Suspected Boston Marathon BomberRead the Press Release
Following an eight-day trial, the jury convicted a college friend of alleged Boston Marathon bomber, Dzhokhar Tsarnaev, for making false statements to investigators assigned to the FBI’s Joint Terrorism Task Force.
The jury found Robel Phillipos, 21, of Cambridge, Massachusetts, guilty of making false statements during the terrorism investigation of the Boston Marathon bombings on April 20, 2013, and April 25, 2013. U.S. District Judge Douglas P. Woodlock scheduled sentencing for Jan. 29, 2015.
“In the wake of one of the most significant events in this City’s modern history – an event which left two young women and a child dead, and many more injured – thousands of ordinary citizens assisted law enforcement in identifying and locating the perpetrators,” said U.S. Attorney Carmen Ortiz for the District of Massachusetts. “Today, a federal jury concluded that Robel Phillipos did just the opposite. He lied to agents when he could have helped. He concealed when he could have assisted. It is a crime to lie to law enforcement agents, and that is why Robel Phillipos was charged and why the jury found him guilty today. But this case also reminds us that our public safety network relies on every citizen in the Commonwealth. We look to all of our citizens – our neighbors, our friends, our colleagues, even strangers whom we have never met before – to assist law enforcement in detecting, preventing, and solving crimes. Mr. Phillipos made a choice: a choice to lie instead of tell the truth. With its verdict today, the jury got it exactly right.”
In August 2014, Dias Kadyrbayev pleaded guilty to obstruction of justice charges related to the Boston Marathon bombing investigation. Kadyrbayev admitted to removing evidence from Tsarnaev’s dormitory room at University of Massachusetts Dartmouth and discarding Tsarnaev’s backpack with fireworks, some of which appeared to have been emptied of their explosive powder, in a garbage dumpster. In July 2014, Azamat Tazhayakov was found guilty by a federal jury in Boston of obstruction of justice charges for his role in impeding the Boston Marathon bombing investigation. His conduct was related to the same conduct as charged against Kadyrbayev that occurred in Tsarnaev’s dormitory room on the evening of April 18, 2013.
At the Phillipos trial, the government proved that Phillipos lied about his knowledge and activities on the evening of April 18, 2013. Specifically, Phillipos repeatedly lied to investigators when he denied that, on the evening of April 18, 2013, he entered Tsarnaev’s dormitory room and saw Kadyrbayev remove a backpack containing fireworks.
According to evidence presented at trial, at 7:00 p.m. on April 18, 2013, Phillipos saw the images released by the FBI of the two suspected bombers and immediately recognized one of them as Dzhokhar Tsarnaev. At 10:00 p.m., Phillipos went with Tazhayakov to Tsarnaev’s dormitory room where he and Tazhayakov watched, as Kadyrbayev searched through Tsarnaev’s belongings and found a backpack containing fireworks. When Kadyrbayev, Tazhayakov and Phillipos left Tsarnaev’s room at 10:30 p.m., Kadyrbayev removed Tsarnaev’s backpack containing fireworks, a jar of Vaseline, and Tsarnaev’s laptop computer. Later that night while Tazhayakov and Phillipos were monitoring the manhunt for the Tsarnaevs on television, Kadyrbayev discussed getting rid of the backpack containing the fireworks with them. Tazhayakov agreed with Kadyrbayev that they should get rid of it. After this conversation, Kadrybayev placed Dzhokhar Tsarnaev’s backpack in a garbage bag and placed it in a dumpster outside their New Bedford apartment. The FBI recovered the backpack a week later, after 30 agents spent two days searching a landfill in New Bedford.
Between April 19, 2013 and April 26, 2013, Phillipos was interviewed five times by investigators conducting the Boston Marathon bombing investigation and during each of those interviews Phillipos lied. At the conclusion of the fifth interview, Phillipos finally admitted that he did go into Tsarnaev’s dormitory room on the evening of April 18, 2013 and that he saw Kadyrbayev remove evidence from Tsarnaev’s room. After he confessed, Phillipos indicated he regretted his decisions. In his signed statement, Phillipos stated: “In retrospect, I should have notified the Police once I knew Jahar was the bomber. Further, I should have turned over the backpack to the authorities.”
The charging statute provides a sentence of no greater than eight years in prison for each of the two false statement counts, three years of supervised release, and a fine of $250,000 for each charge. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
The sentencing hearing for Kadyrbayev is scheduled for Nov. 18, 2014, and Tazhayakov’s sentencing is scheduled for Nov. 19, 2014.
U.S. Attorney Ortiz and Special Agent in Charge Vincent B. Lisi of the Federal Bureau of Investigation’s Boston Field Division made the announcement today. This investigation was conducted by the FBI's Boston Division and member agencies of the Boston Joint Terrorism Task Force (JTTF) which is comprised of more than 30 federal, state and local enforcement agencies. Essex County Sheriff’s Office, U.S. Department of Transportation – Office of Inspector General, Massachusetts State Police, University of Massachusetts Dartmouth Department of Public Safety, New Bedford Police Department, Dartmouth Police Department, U.S. Treasury Inspector General for Tax Administration (TIGTA), Internal Revenue Service, Criminal Investigations, and Homeland Security Investigations in Boston provided assistance to this investigation.
The case is being prosecuted by Assistant U.S. Attorneys B. Stephanie Siegmann and John A. Capin of U.S. Attorney Ortiz’s Anti-Terrorism and National Security Unit.
Federal Jury Convicts Friend of Suspected BomberRead the Press Release
BOSTON – Following an eight-day trial, the jury convicted a college friend of alleged Boston Marathon bomber, Dzhokhar Tsarnaev, for making false statements to investigators assigned to the FBI’s Joint Terrorism Task Force.
The jury found Robel Phillipos, 21, of Cambridge, guilty of making false statements during the terrorism investigation of the Boston Marathon bombings on April 20, 2013 and April 25, 2013. U.S. District Judge Douglas P. Woodlock scheduled sentencing for Jan. 29, 2015.
U.S. Attorney Carmen Ortiz said, “In the wake of one of the most significant events in this City’s modern history – an event which left two young women and a child dead, and many more injured – thousands of ordinary citizens assisted law enforcement in identifying and locating the perpetrators. Today, a federal jury concluded that Robel Phillipos did just the opposite. He lied to agents when he could have helped. He concealed when he could have assisted. It is a crime to lie to law enforcement agents, and that is why Robel Phillipos was charged and why the jury found him guilty today. But this case also reminds us that our public safety network relies on every citizen in the Commonwealth. We look to all of our citizens – our neighbors, our friends, our colleagues, even strangers whom we have never met before – to assist law enforcement in detecting, preventing, and solving crimes. Mr. Phillipos made a choice: a choice to lie instead of tell the truth. With its verdict today, the jury got it exactly right.”
In August 2014, Dias Kadyrbayev pleaded guilty to obstruction of justice charges related to the Boston Marathon bombing investigation. Kadyrbayev admitted to removing evidence from Tsarnaev’s dormitory room at University of Massachusetts Dartmouth and discarding Tsarnaev’s backpack with fireworks, some of which appeared to have been emptied of their explosive powder, in a garbage dumpster. In July 2014, Azamat Tazhayakov was found guilty by a federal jury in Boston of obstruction of justice charges for his role in impeding the Boston Marathon bombing investigation. His conduct was related to the same conduct as charged against Kadyrbayev that occurred in Tsarnaev’s dormitory room on the evening of April 18, 2013.
At the Phillipos trial, the government proved that Phillipos lied about his knowledge and activities on the evening of April 18, 2013. Specifically, Phillipos repeatedly lied to investigators when he denied that, on the evening of April 18, 2013, he entered Tsarnaev’s dormitory room and saw Kadyrbayev remove a backpack containing fireworks.According to evidence presented at trial, at 7:00 p.m. on April 18, 2013, Phillipos saw the images released by the FBI of the two suspected bombers and immediately recognized one of them as Dzhokhar Tsarnaev. At 10:00 p.m., Phillipos went with Tazhayakov to Tsarnaev’s dormitory room where he and Tazhayakov watched, as Kadyrbayev searched through Tsarnaev’s belongings and found a backpack containing fireworks. When Kadyrbayev, Tazhayakov and Phillipos left Tsarnaev’s room at 10:30 p.m., Kadyrbayev removed Tsarnaev’s backpack containing fireworks, a jar of Vaseline, and Tsarnaev’s laptop computer. Later that night while Tazhayakov and Phillipos were monitoring the manhunt for the Tsarnaevs on television, Kadyrbayev discussed getting rid of the backpack containing the fireworks with them. Tazhayakov agreed with Kadyrbayev that they should get rid of it. After this conversation, Kadrybayev placed Dzhokhar Tsarnaev’s backpack in a garbage bag and placed it in a dumpster outside their New Bedford apartment. The FBI recovered the backpack a week later, after 30 agents spent two days searching a landfill in New Bedford.
Between April 19, 2013 and April 26, 2013, Phillipos was interviewed five times by investigators conducting the Boston Marathon bombing investigation and during each of those interviews Phillipos lied. At the conclusion of the fifth interview, Phillipos finally admitted that he did go into Tsarnaev’s dormitory room on the evening of April 18, 2013 and that he saw Kadyrbayev remove evidence from Tsarnaev’s room. After he confessed, Phillipos indicated he regretted his decisions. In his signed statement, Phillipos stated: “In retrospect, I should have notified the Police once I knew Jahar was the bomber. Further, I should have turned over the backpack to the authorities.”
The charging statute provides a sentence of no greater than eight years in prison for each of the two false statement counts, three years of supervised release, and a fine of $250,000 for each charge. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
The sentencing hearing for Kadyrbayev is scheduled for Nov. 18, 2014 and Tazhayakov’s sentencing is scheduled for Nov. 19, 2014.
United States Attorney Carmen M. Ortiz and Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation’s Boston Field Division, made the announcement today. This investigation was conducted by the FBI's Boston Division and member agencies of the Boston Joint Terrorism Task Force (JTTF) which is comprised of more than 30 federal, state and local enforcement agencies. Essex County Sheriff’s Office, U.S. Department of Transportation – Office of Inspector General, Massachusetts State Police, University of Massachusetts Dartmouth Department of Public Safety, New Bedford Police Department, Dartmouth Police Department, U.S. Treasury Inspector General for Tax Administration (TIGTA), Internal Revenue Service, Criminal Investigations, and Homeland Security Investigations in Boston provided assistance to this investigation.
The case is being prosecuted by Assistant U.S. Attorneys B. Stephanie Siegmann and John A. Capin of Ortiz’s Anti-Terrorism and National Security Unit.Federal Jury Convicts Brothers in Synthetic Drug Distribution ConspiracyRead the Press Release
DALLAS — A federal jury in Dallas has convicted two brothers on multiple felony offenses stemming from their operation of a dangerous, designer synthetic drug trafficking organization, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
Following a nearly two-week trial before U.S. District Judge Jane J. Boyle, Barry Bays, 43, and his brother, Jerad Coleman, 28, both of Fort Wayne, Indiana, were convicted on all counts of a fourth superseding indictment returned by a federal grand jury in July 2014. The charges stem from the Drug Enforcement Administration’s (DEA) Project Synergy that targeted these synthetic drug trafficking organizations.
Specifically, Bays and Coleman were each convicted on one count of conspiracy to defraud the U.S. Food and Drug Administration (FDA); one count of conspiracy to commit mail fraud; and one count of conspiracy to distribute a controlled substance analogue. In addition, Bays was also convicted on one count of possessing a firearm in furtherance of a drug trafficking crime and one count of using a communication facility to facilitate a drug felony.
Seven other defendants charged in the case have pleaded guilty to their respective roles: Samuel Madeley, 22, of Denton, Texas; David Muise, 23, of Londonderry, New Hampshire; Holden Bownds, 23, of Denton; and Aaron Parrish, 31, Jennie Miller, 41, Kyle Boyer, 31, and Brandon Zerler, 26, all of Fort Wayne. Miller was sentenced to 12 months and one day in federal prison for acting as a “straw purchaser” of the firearm possessed by Bays during the drug conspiracy. The other defendants are scheduled to be sentenced in the upcoming months.
Bays owned Little Arm, Inc., that did business as B&B Distribution (B&B) in Fort Wayne and then later in Defiance, Ohio. B&B sold products marketed as “incense,” “potpourri,” “air freshener,” or “aroma therapy products,” which claimed to be “not for human consumption,” to businesses in at least 38 states. Coleman served as a corporate officer for B&B and held various positions within the business.
The government presented evidence that during the conspiracy, Bays, Coleman and others conspired together to defraud the FDA by introducing or delivering an adulterated or misbranded drug into interstate commerce with the intent to defraud or mislead. As part of the conspiracy, Bays, Coleman and others possessed, packaged, labeled, marketed, distributed and sold substances containing various synthetic cannabinoids throughout the U.S. Synthetic cannabinoids are defined as “drugs” under the Federal Food, Drug, and Cosmetic Act (FDCA).
After acquiring the synthetic cannabinoids, Bays and B&B had them mixed with a green leafy (smokable) plant material to create a product commonly referred to as “spice.” That substance was then packaged and labeled with brand names such as “B2 Da Bomb,” “V8,” “Roses,” and “Street Legal.” The products were then sold to customers throughout the U.S. as “incense,” “potpourri,” “air freshener,” or “aroma therapy products,” and “not for human consumption,” when in fact, they were intended for human consumption as a drug.
During trial, the government introduced evidence that Bays had contracted with Muise for Muise to create multiple YouTube videos, reviewing Bays’ “spice” products. Muise’s reviews documented the intended use of Bays’ products as drugs.
Madeley and Bownds collaborated and collectively brokered the sale of Scheduled I controlled substance analogues. They solicited customers via the internet and knew the chemicals they were brokering were being used to produce “spice” intended for human consumption. Madeley and Bownds made multiple sales to Bays and B&B, where he made his own brands of synthetic “spice” and distributed it to various “smoke shops” and convenience stores throughout the U.S.
Bays and Coleman remain in federal custody. A sentencing date has not been set.
The maximum statutory penalties are: conspiracy to defraud the U.S. – three years and a $250,000 fine; conspiracy to commit mail fraud – 20 years and a $250,000 fine; conspiracy to distribute a controlled substance analogue – 20 years and a $1 million fine; possession of a firearm in furtherance of a drug trafficking crime – mandatory five years and a $250,000 fine; and use of a communication facility to facilitate a drug felony – four years and a $250,000 fine. The indictment also includes a forfeiture allegation that requires the defendants to forfeit their proceeds from the offenses as well as vehicles, a residence on Tillman Road in Fort Wayne, and approximately $437,000 in funds seized by the government during the investigation.
The DEA led the investigation with assistance from the Fort Wayne Police Department, Indiana State Police, and the Denton County Sheriff’s Office. Assistant U.S. Attorneys Brian Poe and Brandon McCarthy are prosecuting.
Federal Grand Jury Indicts Charleston Man for Murder of InformantRead the Press Release
CHARLESTON, W.Va. – United States Attorney Booth Goodwin announced that a 38-year-old man was indicted today by a federal grand jury sitting in Charleston for offenses related to the murder of a prosecution witness. According to the seven-count indictment, Marlon Dewayne Dixon, of Charleston, W.Va. distributed heroin on three occasions in May of 2014. On July 12, 2014, Dixon shot and killed Branda Mae Delight Basham, 21, in retaliation for her cooperation with law enforcement in that investigation and to prevent her from testifying or continuing to provide information against him. Dixon has multiple felony convictions and was prohibited from possessing a firearm. The indictment alleges that Dixon was convicted in federal court of cocaine base and cocaine distribution in 1999 and 2006 as well as convicted in Kanawha County Circuit Court of malicious wounding in 2007.
Dixon faces up to life in federal prison or the death penalty, if convicted.
The investigation was conducted by the Charleston Police Department, the Metro Drug Unit (MDENT), and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. Assistant United States Attorney Joshua Hanks is in charge of the prosecution.
Click here to see a copy of the indictment. An indictment is only an allegation. A defendant is presumed innocent until and unless he is convicted.
Federal Election Officer Available on Election Day to Field Complaints of Election Fraud and Voting Rights AbusesRead the Press Release
BIRMINGHAM -- U.S. Attorney Joyce White Vance announced today that Assistant U.S. Attorney Pat Meadows will lead the efforts of her office in connection with the Justice Department's nationwide Election Day Program for the Nov. 4 general elections.
Meadows will serve as the District Election Officer for the Northern District of Alabama. In that capacity, he is responsible for overseeing the district's handling of complaints of election fraud and voting rights abuses, in consultation with Justice Department headquarters in Washington, D.C.
"Every citizen must be able to vote without interference or discrimination, and to have that vote counted without it being stolen because of fraud," Vance said. "The department's long-standing Election Day Program furthers these goals, and also seeks to ensure public confidence in the integrity of the election process by providing local contacts within the department so the public can report possible election fraud and voting rights violations while the polls are open on Election Day.
Federal law protects against such crimes as intimidating or bribing voters, buying and selling votes, impersonating voters, altering vote tallies, stuffing ballot boxes, and marking ballots for voters against their wishes or without their input. It also contains special protection for the rights of voters and provides that they can vote free from acts that intimidate or harass them. For example, it may violate federal voting rights law to interrupt or intimidate voters at polling places by questioning or challenging them, or by photographing or videotaping them, under the pretext that those actions are designed to uncover illegal voting. Further, federal law protects the right of voters to mark their own ballot or to choose someone to assist them.
The voting franchise is the cornerstone of American democracy. We all must ensure that those who are entitled to the franchise exercise it if they choose, and that those who seek to corrupt it are brought to justice. In order to respond to complaints of election fraud or voting rights abuses on Nov. 4, and to ensure that such complaints are directed to the appropriate authorities, Meadows will be on duty in the Northern District while the polls are open. The public can reach him at the following number: (205) 244-2001.
In addition, the FBI will have special agents available in each field office and resident agency throughout the country to receive allegations of election fraud and other election abuses on Election Day. The phone number for the local FBI field office is (205) 326-6166.
Complaints about possible violations of the federal voting rights laws can be made directly to the Civil Rights Division's Voting Section in Washington, D.C., by phone at 1-800-253-3931 or (202) 307-3961, by e-mail to [email protected] or by complaint form at http://www.justice.gov/crt/complaint/votintake/index.php.
"Ensuring free and fair elections depends in large part on the cooperation of the American electorate," Vance said. "It is imperative that those who have specific information about discrimination or election fraud make that information available immediately to my office, the FBI or the Civil Rights Division."Father & Son Operators of A Third Party Payroll Company Indicted for Defrauding Client Companies of More Than $11 MillionRead the Press Release
Son embezzled at least $3.7 million to pay for strip clubs, alcohol, jewelry and lavish residence
CHARLOTTE, N.C. – The two operators of a third party payroll company have been indicted for stealing more than $11 million from at least 113 clients and using the money to support their personal lifestyles, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina. The criminal indictment was returned by a federal grand jury on Thursday, October 23, 2014, and was unsealed today following the arrest of James William Staz, 43, of Iron Station, N.C. James Staz’s father, William James Staz, 72, of Huntersville, N.C., is the co-defendant named in the 10-count indictment.
U.S. Attorney Tompkins is joined in making today’s announcement by John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division and Thomas J. Holloman III, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division (IRS-CI).
According to the allegations contained in the indictment:
William and James Staz operated “Employee Services.Net, Inc.” (ESN), a third party payroll company the two men formed in 2004 in Cornelius, N.C. James Staz was the vice president and financial manager of ESN until August 2011, when he became the company’s president. His father, William Stanz, was a company shareholder and managed ESN’s day-to-day operations until 2008, when he was incarcerated for a federal bank fraud conviction. William Stanz returned to ESN following his release from prison and continued to be involved in company operations.
As a third party payroll company, ESN provided various personnel services to its client companies, including processing payroll, collecting and paying federal, state and local employment taxes, and preparing and filing the required employment tax forms. In order to provide these services and make payments on behalf of its clients, ESN had access to the clients companies’ bank accounts and directly drafted the funds needed to cover the expenses. At its height, ESN had approximately 500 client companies located throughout the United States.
From about 2008 to March 2014, the defendants defrauded at least 113 ESN clients of approximately $11 million dollars intended for payroll and employment tax payments and used it to support their personal lifestyles. The victim companies include, among others, a company dedicated to delivering services for children with developmental disabilities or chronic illness, families in poverty, and families caring for the elderly and a company involved in the production of racing engines for a number of NASCAR Sprint Cup teams.
During that time period, James Staz embezzled at least $3.7 million in client funds and directed the money to his personal bank account. In order to conceal his embezzlement, James Staz made false entries into ESN’s accounting system to make it appear as though the stolen funds were used for legitimate client expenses. In reality, James Staz used the money to pay for alcohol, strip club entertainment, jewelry, a Mercedes Benz and a luxury home with a lavish three-tiered pool, a cascading waterfall, wet bar and dining area. For example, on October 25, 2012, James Staz embezzled nearly $125,000 from ESN and in the next four days, he spent the stolen funds on nearly $40,000 in charges at strip clubs and night clubs and nearly $120,000 on a new Mercedes Benz. Over the course of the fraudulent scheme, William Staz drew a salary from ESN as high as $200,000, including for the 9-month period he was incarcerated in federal prison.
To conceal their theft and to cover the losses and tax penalties caused to ESN clients by the delinquent payments, the defendants comingled and used client funds ESN collected for a current payroll/tax period to cover the previous period’s payroll and taxes. To further cover their scheme, the defendants then sent regular emails to clients, falsely stating that all employment taxes had been paid, which was not true for some of ESN’s clients.
The indictment charges William and James Staz with one count of wire fraud. James Staz is also charged with nine counts of money laundering. James Staz had his initial appearance today before U.S. Magistrate Judge David Keesler and will remain in custody pending his arraignment and detention hearing, which have been scheduled for Friday, October 31, at 9:30 a.m. William Staz will be ordered to appear on a summons.
The maximum prison term for the wire fraud charge is 20 years and a $250,000 fine. The maximum prison term for each of the money laundering charges is 20 years in prison and a $500,000 fine or twice the amount of the criminally derived proceeds, whichever is greater.
The details contained in this indictment are allegations. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The investigation for the case was handled by the FBI and IRS-CI. The prosecution of the case is being handled by Assistant U.S. Attorney Kelli H. Ferry of the U.S. Attorney’s Office, in Charlotte.
Eagle Butte Man Charged with Sexual Contact with A MinorRead the Press Release
United States Attorney Brendan V. Johnson announced that an Eagle Butte, South Dakota, man has been indicted by a federal grand jury for Sexual Contact with a Minor.
John Earl Miner, age 42, was indicted by a federal grand jury on October 15, 2014. He appeared before U.S. Magistrate Judge Mark A. Moreno on October 22, 2014, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 2 years in custody and/or a $250,000 fine, at least 5 years and up to life of supervised release, and a $100 special assessment to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on June 17, 2014, in Dupree, South Dakota, Miner engaged in, or attempted to engage in, sexual contact with a minor.
The charge is merely an accusation and Miner is presumed innocent until and unless proven guilty.The investigation is being conducted by the Cheyenne River Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Mikal Hanson is prosecuting the case.
Miner was remanded to the custody of the U.S. Marshals Service. A trial date has not been set.
Eagle Butte Man Charged with Assaulting A Federal OfficerRead the Press Release
United States Attorney Brendan V. Johnson announced that an Eagle Butte, South Dakota, man has been indicted by a federal grand jury for Assaulting, Resisting, or Impeding a Federal Officer Involving Physical Contact.
Lucas Curley, age 23, was indicted on October 15, 2014. He appeared before U.S. Magistrate Judge Mark A. Moreno on October 22, 2014, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 8 years in custody and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that in March of 2014, Curley forcibly assaulted, resisted, opposed, impeded, intimidated, and interfered with a Cheyenne River Sioux Tribe Law Enforcement Officer while the officer was engaged in the performance of his official duties.
The charge is merely an accusation and Curley is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Cheyenne River Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Mikal Hanson is prosecuting the case.
Curley was released on bond pending trial. A trial date has not been set.
Eagle Butte Man and Woman Charged with Child AbuseRead the Press Release
United States Attorney Brendan V. Johnson announced that an Eagle Butte, South Dakota, man and woman have been indicted by a federal grand jury for Felony Child Abuse.
Jordyn Blue Coat, a/k/a Jordyn Swan, age 21, and Francis Swan, age 25, were indicted by a federal grand jury on October 21, 2014. They appeared before U.S. Magistrate Judge Mark A. Moreno on October 24, 2014, and pled not guilty to the Indictment.
The maximum penalty upon conviction is 15 years in custody and/or a $250,000 fine, 3 years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund. Restitution may also be ordered.
The charge stems from an allegation that between August 17, 2014, and October 17, 2014, at No Heart Housing near Eagle Butte, Blue Coat and Swan abused, tortured, tormented, and cruelly punished a child under the age of seven years old.
The charge is merely an accusation and Blue Coat and Swan are presumed innocent until and unless proven guilty.
The investigation is being conducted by the Federal Bureau of Investigation, the South Dakota Department of Social Services, and the Cheyenne River Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Mikal Hanson is prosecuting the case.
Blue Coat and Swan were remanded to the custody of the U.S. Marshals Service. A trial date has not been set.
DeanCoconspirator and Local Methamphetamine Dealer Both Sentenced to Federal PrisonRead the Press Release
A Sioux City man was sentenced October 24, 2014, to 10 years in federal prison, and a Sioux City woman was also sentenced on October 24, 2014, to 5 years in federal prison.
Craig Barclay, age 34, from Sioux City, received his prison term after a February 27, 2014, guilty plea to conspiracy to distribute methamphetamine.
Sarah Berg, age 33, from Sioux City, received her prison term after a May 5, 2014, guilty plea to one count of conspiracy to interfere with commerce by robbery, one count of interfering with commerce by robbery, one count of carjacking, and one count of transporting a stolen vehicle interstate.
Evidence presented at the Jamal and Levon Dean trial revealed on April 15, 2013, Sarah Berg took the Deans along as muscle to an encounter with Jeffery Rollinger (who at the time of the robbery was a drug dealer). As soon as they arrived at Rollinger’s location he was robbed at gunpoint of his illegal drugs and other property and carjacked. In a second robbery committed on April 24, 2013, Jamal and Levon Dean robbed Craig Barclay at gunpoint stealing illegal drugs and other property from Barclay, who at the time of the robbery was a drug dealer.
The October 24, sentencings were punishment for Berg’s role in the April 15 offense and Barclay’s drug trafficking.
Barclay and Berg were sentenced in Sioux City by United States District Court Judge Mark W. Bennett. Barclay was sentenced to 120 months’ imprisonment. A special assessment of $100 was imposed. Berg was sentenced to 60 months’ imprisonment. A special assessment of $400 was imposed. Barclay must also serve a five-year term of supervised release after the prison term and Berg must serve a 3-year term of supervised release after the prison term. There is no parole in the federal system.
Both Barclay and Berg are being held in the United States Marshal’s custody until they can be transported to a federal prison.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number for Barclay is 13-4106 and the case file number for Berg is 13-4082.
The case is part of Project Safe Neighborhoods, a cooperative local, state, and federal program aimed at the enhanced prosecution of gun and violent crimes. The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the United States Marshal’s Service, the Iowa Department of Public Safety, the Tri State Drug Task Force, the Texas Department of Public Safety, the Sioux City, Iowa Police Department, the South Sioux City, Nebraska Police Department, the Woodbury County (Iowa) Attorney’s Office, the Dakota County (Nebraska) Attorney’s Office, the Nebraska State Patrol, the Dakota County (Nebraska) Sheriff’s Office and the Woodbury County (Iowa) Sheriff’s Office. The case was prosecuted by Assistant United States Attorney Forde Fairchild.
DAVENPORT MAN FACES FRAUD, MONEY LAUNDERING CHARGES Allegedly Defrauded Former Employer of $2.7 MillionRead the Press Release
Rock Island, Ill. – Jim Lewis, U.S. Attorney for the Central District of Illinois, announced that Dominic Scodeller, 47, of the 2000 block of Meadowbrook Drive, Davenport, Iowa, made his initial appearance in federal court today on charges of fraud and money laundering. The grand jury returned the indictment on Oct. 21, 2014; however, the indictment had remained sealed pending the defendant’s arrest and court appearance.
The 15-count indictment alleges that from about 2001 to May 2013, Scodeller defrauded his former employer, Bituminous Insurance Companies (BITCO), which has its headquarters in Rock Island, of at least $2.7 million. As a manager of purchasing and facilities for BITCO, Scodeller allegedly approved payments to bogus entities he created and controlled. After BITCO paid the fraudulent entities, Scodeller allegedly transferred the stolen money from the entities’ accounts for his personal use.
If convicted, the statutory maximum penalty for each count of mail or wire fraud is 20 years in prison, and a fine of up to $250,000; the statutory maximum penalty for each count of money laundering is 20 years in prison, and a fine of up to $500,000, or twice the value of property involved in the transactions, whichever is greater.
Scodeller was arrested today and appeared this afternoon before U.S. District Judge Sara L. Darrow, in Rock Island. Scodeller was ordered temporarily detained in the custody of the U.S. Marshals Service pending a detention hearing scheduled on Oct. 29, at 11:00 a.m.
The case is being prosecuted by Assistant U.S. Attorneys Donald Allegro and Meredith DeCarlo. The matter was referred to federal law enforcement, the FBI and IRS, Criminal Investigation, by BITCO following its internal investigation of the alleged fraud.
Members of the public are reminded that an indictment is merely an accusation; the defendant is presumed innocent unless proven guilty.
# # # #Chelsea Man Pleads Guilty in Fraudulent Drivers License SchemeRead the Press Release
BOSTON – A Chelsea man pleaded guilty today in connection with a scheme to produce fraudulent identification documents.
Leonel Sanchez, 52, pleaded guilty to conspiracy to produce false identification documents and aggravated identity theft. U.S. District Court Judge Douglas P. Woodlock scheduled sentencing for Jan. 20, 2015 at 2:00 pm. From December 2012 through January 2013, Sanchez bribed an employee of the Massachusetts Registry of Motor Vehicles in connection with a scheme to issue Massachusetts driver’s licenses to individuals who presented fraudulently obtained Puerto Rican identification documents.
This plea is the most recent development in investigations involving identity theft and public corruption relating to the Massachusetts Registry of Motor Vehicles.
United States Attorney Carmen M. Ortiz; Bruce M. Foucart, Special Agent in Charge of Homeland Security Investigations in Boston; Colonel Timothy P. Alben, Superintendent of the Massachusetts States Police; David W. Hall, Special Agent in Charge of the U.S. Department of State, Bureau of Diplomatic Security, Boston Field Office; and Cheryl Garcia, Special Agent in Charge of the U.S. Department of Labor, Office of Inspector General, New York Regional Office, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Eugenia M. Carris of Ortiz’s Public Corruption Unit.
Charleroi Woman Helped Pass Counterfeit Cash at Western PA Retail StoresRead the Press Release
PITTSBURGH – A resident of Washington County pleaded guilty in federal court to a charge of conspiracy, United States Attorney David J. Hickton announced today.
Cheryl Leigh Johnson, 36, of Charleroi, Pa., pleaded guilty to one count before United States District Court Judge Cathy Bissoon.
In connection with the guilty plea, the court was advised that during the period from July 1, 2014, through July 28, 2014, Johnson conspired with codefendants John Viloria, Barry Robert Youger, Jr. and Eric Seighman, to pass thousands of dollars of counterfeit Federal Reserve notes at various retail store locations in the Western District of Pennsylvania.
Judge Bissoon scheduled sentencing for March 2, 2015 at 10 a.m. The law provides for a maximum total sentence of not more than five years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Pending sentence, the court released Johnson on bond.
Assistant United States Attorney Mary McKeen Houghton is prosecuting this case on behalf of the government.
The United States Secret Service conducted the investigation that lead to the prosecution of Johnson.
Cayuga County Man Indicted on Federal Child Enticement and Child Pornography ChargesRead the Press Release
Charges include possession, distribution and receipt of child pornography
SYRACUSE, NEW YORK – Auburn, NY resident MICHAEL J. MAHANNAH, age 31, was formally charged today in federal court in Syracuse on multiple counts, including attempted coercion and enticement of a minor, according to United States Attorney Richard S. Hartunian. Following an initial appearance before United States Magistrate Judge Andrew T. Baxter, Mahannah is being held without bond.
The twelve-count indictment returned by the federal Grand Jury charged Mahannah with the following crimes: Count 1 – Attempted Coercion and Enticement of an individual the defendant believed to be a twelve year-old male child (who was in fact an undercover police officer); Count 2 – Felony Offense Against a Minor by a Registered Sex Offender; Counts 3-7 – Distribution of Child Pornography; Counts 8-11 – Receipt of Child Pornography; and Count 12 – Possession of Child Pornography.
If found guilty of Counts 1 and 2, Mahannah faces a statutory minimum of at least 20 years in prison and a maximum term of life in prison. On Counts 3-11, the defendant faces a statutory minimum of at least 5 years in prison and a maximum of 20 years in prison. On Count 12, the defendant faces a maximum of 20 years in prison. Mahannah may be fined up to $250,000 on each count of conviction. Upon release from prison, he would be placed on Supervised Release for a mandatory minimum of at least five years and up to life. He would also be required to register as a sex offender.
The charges in the indictment are merely accusations and the defendant is presumed innocent until and unless proven guilty.
This case is being investigated by the United States Secret Service, the New York State Police, the Syracuse Police Department, and the Cayuga County District Attorney’s Office, as part of Project Safe Childhood.
Project Safe Childhood is a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Launched in May 2006 by the Department of Justice, and led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to 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 www.projectsafechildhood.gov.
The case is being prosecuted by Assistant United States Attorneys Lisa Fletcher and Nicolas Commandeur.
California Woman Sentenced for Conspiracy to Defraud Internal Revenue Service and Wire FraudRead the Press Release
A Fresno, California, resident was sentenced to serve 18 months in prison and pay $703,537 in restitution for conspiring to defraud the Internal Revenue Service (IRS) by aiding to obtain payment of fraudulent tax refund claims and committing wire fraud, the Justice Department and IRS announced today.
Pursuant to a plea agreement, Kathryn Darlene Coryell pleaded guilty to two counts of a 44-count indictment on June 26. Her co-defendant, Noemi Baez, pleaded guilty on Oct. 31, 2013, to charges of conspiring to defraud the IRS and committing aggravated identity theft.
According to the plea agreement, beginning around Feb. 28, 2008, and continuing through April 16, 2012, Coryell and Baez participated in a scheme to obtain and help others to obtain payment of false claims for tax refunds from the IRS by electronically filing fraudulent federal income tax returns. Using the names and social security numbers of numerous individuals, Coryell and Baez fabricated income information and filed materially false income tax returns claiming tax refunds derived from credits, including the Earned Income Credit, the Additional Child Tax Credit and the Making Work Pay Credit. In the plea agreement, Coryell admitted that, during the conspiracy, she and her co-defendant filed more than 150 false tax returns claiming fraudulent tax refunds totaling more than $400,000.
The case was investigated by special agents of the IRS-Criminal Investigation and was prosecuted by Trial Attorneys Erin S. Mellen, Sonia M. Owens and Charles A. O’Reilly of the Tax Division.
California Man Sentenced to 1½ Years in Prison for Theft and Embezzlement from the Passamaquoddy TribeRead the Press Release
Contact: F. Todd Lowell
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Charles
Fourcloud, a/k/a “Arlynn E. Knudsen,” 59, of San Jose, California, was sentenced today in
U.S. District Court by Judge George Z. Singal to 1½ years in prison and three years of
supervised release for stealing and embezzling funds from the Passamaquoddy Tribe at Pleasant
Point. He was also ordered to pay $22,571.61 in restitution. Fourcloud pleaded guilty on June
26, 2014.Court records show that in May 2013, the defendant was hired by the tribe to serve as its
chief financial officer (CFO). He applied for the CFO position using a fictitious employment
history and fake references. He also concealed the facts that in 1997 he was convicted in federal
court in the Western Division of South Dakota of conspiracy to defraud the United States, theft
from an Indian tribal organization, theft from a program receiving federal funds, money
laundering and structuring and that he served an eight year prison sentence. From April through
August 2013, the defendant fraudulently obtained and stole about $20,000 from the tribe by
submitting fraudulent travel expense reports and supporting documentation and by submitting
fraudulent documentation related to moving expense reimbursement.The investigation was conducted jointly by the U.S. Department of Health and Human
Services Office of Inspector General and the Pleasant Point Police Department.Bullhead Man Charged with Failure to Register as A Sex OffenderRead the Press Release
United States Attorney Brendan V. Johnson announced that a Bullhead, South Dakota, man has been indicted by a federal grand jury for Failure to Register as a Sex Offender.
Miles Yellow Earrings, age 31, was indicted on October 15, 2014. He appeared before U.S. Magistrate Judge William D. Gerdes on October 17, 2014, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in custody and/or a $250,000 fine, a mandatory minimum period of at least 5 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that between May 10, 2014, and June 18, 2014, Yellow Earrings, a person required to register under the Sex Offender Registration and Notification Act, failed to register and update his registration.
The charge is merely an accusation and Yellow Earrings is presumed innocent until and unless proven guilty.
The investigation is being conducted by the U.S. Marshals Service. Assistant U.S. Attorney Troy R. Morley is prosecuting the case.
Yellow Earrings was remanded to the custody of the U.S. Marshals Service pending trial, which has been set for December 16, 2014.
Brunswick Women Sentenced to 20 Months in Prison for Federal Program and Tax FraudRead the Press Release
Contact: Donald E. Clark
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced that Stacey
A. Backman, 41, of Brunswick, Maine, was sentenced in U.S. District Court by Judge D. Brock
Hornby to 20 months in prison for federal program and tax fraud. She was also ordered to pay
$365,168 in restitution. She pled guilty to the offenses on June 9, 2014.According to court records, the defendant was a fund accountant at Coastal Enterprises,
Inc. (CEI). CEI is a private, nonprofit, charitable Community Development Corporation and
Community Development Financial Institution based in Wiscasset, Maine that received more
than $10,000 in federal funds each year. From 2010 to January 2014, the defendant embezzled
$365,168 from CEI and failed to report the embezzled income on her federal income tax
returns. CEI learned of the embezzlement in January 2014 and terminated the defendant’s
employment.The case was investigated by the U.S. Department of Health and Human Services, Office
of Inspector General (OIG); the Internal Revenue Service – Criminal Investigations Division; the
U.S. Department of Agriculture, OIG; and the Wiscasset Police Department.Brattleboro Man Sentenced to Prison for Child Pornography OffenseRead the Press Release
The Office of the United States Attorney for the District of Vermont stated that Grant Klein, 33, of Brattleboro, Vermont, was sentenced on October 27, 2014, in United States District Court in Rutland, Vermont, to serve a term of 12 months and one-day imprisonment and a 10-year period of supervised release following his conviction on one count of possession of child pornography, in violation of 18 U.S.C. § 2252(a)(4)(B). Judge Geoffrey C. Crawford also ordered Klein to pay a $100 special assessment.
According to court records and proceedings, law enforcement executed a warrant to search Klein’s residence for evidence of child pornography offenses after a computer located at that residence was identified as accessing and downloading child pornography over the Internet. Klein admitted that he possessed child pornography on his cell phone, he had earlier destroyed the hard drive to his desktop computer to avoid detection by law enforcement, he derived sexual gratification from looking at child pornography, and he described himself as a pedophile. A forensic examination of his cellphone revealed approximately 71 images of child pornography were on it. Some of the images in Klein’s collection depicted the rape of infants and other sadistic and masochistic conduct.
United States Attorney Coffin commended the efforts of the Federal Bureau of Investigation, the Brattleboro Police Department, and the Vermont Internet Crimes Against Children Task in the investigation and prosecution of Klein.
The prosecution of Klein was handled by Assistant U.S. Attorney Barbara A. Masterson. Klein was represented by Assistant Federal Defender David L. McColgin.
U.S. Attorney Coffin noted that this prosecution is part of the U.S. Department of Justice=s 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.
Blairsville Man Sentenced to Prison for Participating in Heroin Trafficking ConpiracyRead the Press Release
Johnstown, Pa. - A resident of Blairsville, Pa., has been sentenced in federal court to 24 months in prison and five years supervised release on his conviction of violating federal narcotics laws, United States Attorney David J. Hickton announced today.
United States District Judge Kim R. Gibson imposed the sentence on Clifford Bernard Camut, Jr., 21.
According to information presented to the court, from the spring of 2011 to May 15, 2012, Camut, along with multiple co-defendants, conspired to distribute and possess with intent to distribute one kilogram or more of heroin.
Assistant U.S. Attorney Stephanie L. Haines prosecuted this case on behalf of the government.
Mr. Hickton commended the Laurel Highlands Resident Agency of the Federal Bureau of Investigation, the Pennsylvania State Police and the Indiana Police Department for the investigation leading to the successful prosecution of Camut. Other agencies participating in this investigation included the Pennsylvania Attorney General’s Office, the Cambria County Drug Task Force, the Cambria County Sheriff’s Department, the Cambria County District Attorney’s Office, the Indiana County Drug Task Force, and the Indiana County District Attorney’s Office.
Biddeford Maine Man Sentenced to 15 Years on Drug ChargesRead the Press Release
CONCORD, NEW HAMPSHIRE – Frederick Drane, 48, of Biddeford, Maine, was sentenced on Monday in the United States District Court for the District of New Hampshire on one count of conspiracy to possess in excess of 28 grams of crack cocaine with the intent to distribute it, and one count of possessing crack cocaine with the intent to distribute it. The Court imposed a term of 15 years’ imprisonment, to be followed by 8 years of supervised release.
In October 2012, Drane was pulled over by the New Hampshire state police for a motor vehicle infraction. During the ensuing stop, authorities located a crack pipe and more than 28 grams of crack cocaine in the vehicle, already packaged for sale.
The case was investigated by the New Hampshire State Police, and prosecuted by Assistant United States Attorneys Seth Aframe and Nick Abramson.
Bangor Man Sentenced to Five Years on Firearms ChargeRead the Press Release
Contact: Andrew McCormack
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Perrin
Oliver, 44, of Bangor and formerly of Brooklyn, New York, was sentenced today in U.S.
District Court by Judge George Z. Singal to five years in prison and three years of supervised
release for being a felon in possession of a firearm. Oliver pleaded guilty to the charge on
December 19, 2013.According to court records and proceedings, on July 4, 2013, Oliver, a previously
convicted felon, was arrested by the police after a stand-off at his Bangor apartment. During the
course of that stand-off, Oliver fired multiple rounds of ammunition from his apartment. After
his arrest, officers found a Rossi .38 Special revolver in Oliver’s waistband. A safe located in
Oliver’s apartment contained a SIG Sauer .380 semi-automatic pistol and crack cocaine
belonging to Oliver.The investigation was conducted by the Bureau of Alcohol, Tobacco, Firearms and
Explosives and the Bangor Police Department.Aubrey Lee Price, Former Bank Director Who Faked His Own Death, Sentenced to 30 Years in PrisonRead the Press Release
Statesboro, GA: Edward J. Tarver, United States Attorney for the Southern District of Georgia, and Loretta E. Lynch, United States Attorney for the Eastern District of New York, announced that Aubrey Lee Price, 48, was sentenced today in Statesboro federal court to 30 years in federal prison for perpetrating a Ponzi scheme that resulted in millions of dollars of losses to dozens of Price’s investors and led to the collapse of a federally insured bank. Today’s sentencing took place before the Honorable B. Avant Edenfield, United States District Judge for the Southern District of Georgia.
“Through a web of lies and deceit, Aubrey Lee Price conned his elderly investors and a federally insured bank of more than $70 million, and then attempted to further his con and avoid accountability by faking his own death. However, his life on the lam ended with a routine traffic stop. Today’s sentence sends a strong message to those who seek to defraud the investing public and our financial institutions that we will pursue them and bring them to justice,” stated United States Attorney Lynch.
“The sentence imposed today reflects the magnitude of Aubrey Lee Price’s fraud,” said United States Attorney Tarver. “Price engaged in a staggering betrayal of trust, leaving his elderly investors practically penniless, and at the same time, contributing to the collapse of a federally insured bank. For his crimes, Price richly deserves the heavy sentence handed down today by the Court.”George Venizelos, Assistant Director in Charge, FBI New York Field Office, along with J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office, stated: “While today’s sentencing of former banker Aubrey Lee Price concludes a lengthy investigation as well as an extensive and resource-intensive manhunt, it does not restore the financial harm done to his many victims. The FBI would like to express its gratitude to those many and varied law enforcement agencies whose efforts in the investigation and apprehension of Mr. Price made today’s sentencing possible. We are hopeful that this announcement will provide some solace to his victims.”
Jason T. Moran, Special Agent in Charge, FDIC Office of Inspector General, stated: “The Federal Deposit Insurance Corporation Office of Inspector General is pleased to have joined the United States Attorney’s Office and our law enforcement colleagues in investigating the fraud that led to the conviction of Aubrey Lee Price. It is particularly troubling when bank insiders violate the public trust and engage in activities that impact the safety and soundness of our nation’s banks.”
“Theft of employee benefit assets jeopardizes the benefits of workers. This case reaffirms the Labor Department’s commitment to protect workers’ benefits by identifying criminal activity wherever and whenever it occurs,” said Isabel Colon, Regional Director of the United States Department of Labor Employee Benefit Security Administration’s Atlanta Regional Office.
According court filings and evidence presented at the guilty plea and sentencing hearings, Price embezzled over $21 million in capital from MB&T, and lost much of it by investing in risky equity securities and options. To cover up his fraud, Price provided MB&T officials with bogus account statements and other false documents which falsely indicated the bank’s capital was safely held in an account at a financial services firm, when in truth, most of the money was gone. A further investigation of Price revealed that between June 2009 and June 2012, he also defrauded approximately 115 individual investors who had invested $51 million in two investment funds he managed. Price lost almost all of that money through speculative trading, and to cover up his losses, Price posted fake account statements on a secure web site that fraudulently reflected fictitious assets and fabricated investment returns for each investor.In mid-June 2012, Price sent acquaintances “suicide letters” in which he admitted he had defrauded MB&T Bank and Price’s individual investors, and that he planned to kill himself by throwing himself off a high-speed ferry boat after it left Key West, Florida. As a result of the suicide claim, the United States Coast Guard searched to no avail for Price’s body. Shortly after sending the letters, Price disappeared. After more than a year of searching for Price, he was arrested on December 31, 2013, after he presented a false identification during a routine traffic stop in Brunswick, Georgia.
Price has been in custody since his arrest on December 31, 2013. In addition to being sentenced to 30 years’ imprisonment, Price was also sentenced to serve a term of 5 years of supervised release. Tarver noted that there is no parole in the federal system. As part of his sentence, Price will also be ordered to pay restitution to the victims of his crimes in an amount to be determined at a restitution hearing to be held by February 1, 2015. In addition, Price was ordered to forfeit a total of $51 million, representing the proceeds of his crimes.
U. S. Attorneys Tarver and Lynch credited the FBI in Georgia, under the direction of Special Agent in Charge Johnson, and in New York, under the direction of Assistant Director in Charge Venizelos, with the investigation leading to today’s sentencing. They also thanked the United States Attorney’s Office for the Southern District of Florida; the United States Attorney’s Office for the Northern District of Georgia; the Securities and Exchange Commission (SEC), Atlanta Regional Office; the Federal Deposit Insurance Corporation (FDIC); the Federal Reserve Board, Office of Inspector General; the United States Coast Guard; the United States Department of Labor; the Lowndes County Georgia Sheriff’s Department; the Glynn County Georgia Sheriff’s Department; the Toombs County Georgia Sheriff’s Department; and the Marion County Florida Sheriff’s Department for their cooperation and assistance in the investigation and prosecution of Price.
The government was represented by Assistant United States Attorney Brian T. Rafferty of the U. S. Attorney’s Office, Southern District of Georgia, and Assistant United States Attorneys Shannon C. Jones and Brian Morris of the U. S. Attorney’s Office, Eastern District of New York.
This prosecution was the result of efforts by President Barack 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. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants. For more information on the task force, visit http://www.StopFraud.gov.The Defendant:
AUBREY LEE PRICE
Age: 48
Valdosta, Georgia
S.D.G.A. Docket No. 612-CR-10
E.D.N.Y. Docket No. 13-CR-058Aubrey Lee Price, Former Bank Director Who Faked His Own Death, Sentenced to 30 Years in PrisonRead the Press Release
BROOKLYN, NY – Edward J. Tarver, United States Attorney for the Southern District of Georgia, and Loretta E. Lynch, United States Attorney for the Eastern District of New York, announced that Aubrey Lee Price, 48, was sentenced today in Statesboro federal court to 30 years in federal prison for perpetrating a Ponzi scheme that resulted in millions of dollars of losses to dozens of Price’s investors and led to the collapse of a federally insured bank. Today’s sentencing took place before the Honorable B. Avant Edenfield, United States District Judge for the Southern District of Georgia.
“Through a web of lies and deceit, Aubrey Lee Price conned his elderly investors and a federally insured bank of more than $70 million, and then attempted to further his con and avoid accountability by faking his own death. However, his life on the lam ended with a routine traffic stop. Today’s sentence sends a strong message to those who seek to defraud the investing public and our financial institutions that we will pursue them and bring them to justice,” stated United States Attorney Lynch.
“The sentence imposed today reflects the magnitude of Aubrey Lee Price’s fraud,” said United States Attorney Tarver. “Price engaged in a staggering betrayal of trust, leaving his elderly investors practically penniless, and at the same time, contributing to the collapse of a federally insured bank. For his crimes, Price richly deserves the heavy sentence handed down today by the Court.”
George Venizelos, Assistant Director in Charge, FBI New York Field Office, along with J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office, stated, “While today’s sentencing of former banker Aubrey Lee Price concludes a lengthy investigation as well as an extensive and resource-intensive manhunt, it does not restore the financial harm done to his many victims. The FBI would like to express its gratitude to those many and varied law enforcement agencies whose efforts in the investigation and apprehension of Mr. Price made today’s sentencing possible. We are hopeful that this announcement will provide some solace to his victims.”
Jason T. Moran, Special Agent in Charge, FDIC Office of Inspector General, stated, “The Federal Deposit Insurance Corporation Office of Inspector General is pleased to have joined the United States Attorney’s Office and our law enforcement colleagues in investigating the fraud that led to the conviction of Aubrey Lee Price. It is particularly troubling when bank insiders violate the public trust and engage in activities that impact the safety and soundness of our nation’s banks.”
“Theft of employee benefit assets jeopardizes the benefits of workers. This case reaffirms the Labor Department’s commitment to protect workers’ benefits by identifying criminal activity wherever and whenever it occurs,” said Isabel Colon, Regional Director of the United States Department of Labor Employee Benefit Security Administration’s Atlanta Regional Office.
According court filings and evidence presented at the guilty plea and sentencing hearings, Price embezzled over $21 million in capital from MB&T, and lost much of it by investing in risky equity securities and options. To cover up his fraud, Price provided MB&T officials with bogus account statements and other false documents which falsely indicated the bank’s capital was safely held in an account at a financial services firm, when in truth, most of the money was gone. A further investigation of Price revealed that between June 2009 and June 2012, he also defrauded approximately 115 individual investors who had invested $51 million in two investment funds he managed. Price lost almost all of that money through speculative trading, and to cover up his losses, Price posted fake account statements on a secure web site that fraudulently reflected fictitious assets and fabricated investment returns for each investor.
In mid-June 2012, Price sent acquaintances “suicide letters” in which he admitted he had defrauded MB&T Bank and Price’s individual investors, and that he planned to kill himself by throwing himself off a high-speed ferry boat after it left Key West, Florida. As a result of the suicide claim, the United States Coast Guard searched to no avail for Price’s body. Shortly after sending the letters, Price disappeared. After more than a year of searching for Price, he was arrested on December 31, 2013, after he presented a false identification during a routine traffic stop in Brunswick, Georgia.
Price has been in custody since his arrest on December 31, 2013. In addition to being sentenced to 30 years’ imprisonment, Price was also sentenced to serve a term of 5 years of supervised release. Tarver noted that there is no parole in the federal system. As part of his sentence, Price will also be ordered to pay restitution to the victims of his crimes in an amount to be determined at a restitution hearing to be held by February 1, 2015. In addition, Price was ordered to forfeit a total of $51 million, representing the proceeds of his crimes.
U. S. Attorneys Tarver and Lynch credited the FBI in Georgia, under the direction of Special Agent in Charge Johnson, and in New York, under the direction of Assistant Director in Charge Venizelos, with the investigation leading to today’s sentencing. They also thanked the United States Attorney’s Office for the Southern District of Florida; the United States Attorney’s Office for the Northern District of Georgia; the Securities and Exchange Commission (SEC), Atlanta Regional Office; the Federal Deposit Insurance Corporation (FDIC); the Federal Reserve Board, Office of Inspector General; the United States Coast Guard; the United States Department of Labor; the Lowndes County Georgia Sheriff’s Department; the Glynn County Georgia Sheriff’s Department; the Toombs County Georgia Sheriff’s Department; and the Marion County Florida Sheriff’s Department for their cooperation and assistance in the investigation and prosecution of Price.
The government was represented by Assistant United States Attorney Brian T. Rafferty of the U. S. Attorney’s Office, Southern District of Georgia, and Assistant United States Attorneys Shannon C. Jones and Brian Morris of the U. S. Attorney’s Office, Eastern District of New York.
This prosecution was the result of efforts by President Barack 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. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants. For more information on the task force, visit http://www.StopFraud.gov.
The Defendant:
AUBREY LEE PRICE
Age: 48
Valdosta, Georgia
S.D.G.A. Docket No. 612-CR-10
E.D.N.Y. Docket No. 13-CR-058
Assistant U.S. Attorneys to be on Duty Election Day for Voting Rights or Election Fraud AbusesRead the Press Release
United States Attorney Steven M. Dettelbach announced today that Assistant United States Attorneys Ann C. Rowland and Ava R. Dustin will lead the efforts of his office in connection with the Justice Department’s nationwide Election Day Program for the upcoming November 4, 2014, general elections.
In order to respond to complaints of voting rights or election fraud abuses on November 4, 2014, and to ensure that such complaints are directed to the appropriate authorities, Rowland and Dustin will be on duty in this District while the polls are open. Rowland can be reached by the public at 216-622-3847 while Dustin can be reached at 419-259-0767. The local FBI field office can be reached by the public at 216-522-1400.
Complaints about possible violations of the federal voting rights laws can be made directly to the Civil Rights Division’s Voting Section in Washington by phone at 1-800-253-3931 or (202) 307-2767, by fax at (202) 307-3961, by email to [email protected] or by complaint form at http://www.justice.gov/crt/complaint/votintake/index.php.
Ashtabula Man Faces Federal Charges Related to Firearms and HeroinRead the Press Release
A federal grand jury returned a four-count indictment charging Michael G. Relliford, 31, of Ashtabula, with distribution of heroin, possessing with the intent to distribute heroin, being a felon in possession of a firearm and ammunition, and possession of a firearm in furtherance of a drug trafficking crime, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Count 1 of the indictment alleges that on or about July 16, 2014, Relliford distributed less than 100 grams of heroin.
Count 2 of the indictment alleges that on or about July 17, 2014, Relliford possessed with the intent to distribute more than 100 grams of heroin.
Count 3 of the indictment alleges that on or about July 17, 2014, Relliford possessed a Ruger, model P90DC, .45 caliber pistol, and ammunition, after having been previously convicted of Illegal Manufacture of Drugs, in the Ashtabula County Court of Common Pleas, Ohio.
Count 4 of the indictment alleges that on or about July 17, 2014, Relliford possessed the above mentioned Ruger firearm in furtherance of a drug trafficking crime.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
The investigation preceding the indictment was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Ashtabula Police Department. The matter is being prosecuted by Assistant United States Attorney Jason M. Katz.
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.
Alabama Tax Preparers Indicted for Stolen Identity Refund FraudRead the Press Release
Two women from Phenix City, Alabama, were indicted yesterday for their involvement in a stolen identity refund fraud scheme (SIRF), Acting Deputy Assistant Attorney General Larry J. Wszalek for the Justice Department's Tax Division and U.S. Attorney George L. Beck Jr. for the Middle District of Alabama announced today following the unsealing of the indictment.
Teresa Floyd and her daughter, Lasondra Davis Miles, were charged with conspiracy to submit false claims, wire fraud and aggravated identity theft. Floyd was also charged with theft of public money.
According to the superseding indictment, Floyd and Davis operated several tax preparation businesses in the Phenix City area, including T & L Tax Service and T & C Used Cars & Tax Service. Floyd and Davis obtained stolen identities and used those identities to file more than 900 federal income tax returns that claimed more than $2.5 million in tax refunds. To obtain the money from the scheme, the defendants applied for bank products from various financial institutions, which provided to the defendants blank check stock. The bank products allow a tax preparer to deduct their fees directly from a tax refund and then print out the remainder of the refund as a check. Floyd and Davis created fictitious identification documents and bills to provide to the financial institutions in an attempt to verify that the returns were filed in the names of legitimate customers. The defendants caused the fraudulent checks to be cashed at several businesses in Alabama and Georgia. Floyd also deposited fraudulent income tax refund checks into her bank account.
If convicted, the defendants face a statutory maximum sentence of 10 years in prison for the conspiracy to file false claims count, a statutory maximum sentence of 20 years in prison for each wire fraud count, a statutory maximum sentence of 10 years in prison for each theft of public money count and a mandatory sentence of two years in prison for the aggravated identity theft counts. The defendants are also subject to fines, forfeiture and mandatory restitution if convicted.
The case was investigated by special agents of the Internal Revenue Service - Criminal Investigation. Trial Attorney Michael Boteler of the Tax Division and Assistant U.S. Attorney Todd Brown for the Middle District of Alabama are prosecuting the case.
An indictment merely alleges that crimes have been committed and the defendants are presumed innocent until proven guilty beyond a reasonable doubt.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
17 Arrested in Tuba City Drug SweepRead the Press Release
PHOENIX – Following a coordinated federal, tribal and state task force investigation into drug trafficking on the Navajo Nation, 20 individuals have been charged with federal drug trafficking crimes. Five remain fugitives. In addition to the 15 arrested on drug trafficking charges, 2 individuals were arrested for alleged violations of the terms of their pretrial release having been arrested in May on assault-related charges, along with 10 other individuals, during the Tuba City violent offender initiative—the first phase of this community impact initiative.
The Federal Bureau of Investigation, the Navajo Nation Department of Public Safety, the Coconino County METRO Drug Task Force and the Drug Enforcement Administration led this enforcement action, with substantial assistance from the United States Marshals Service, the Bureau of Indian Affairs and the Arizona Department of Public Safety.
United States Attorney John S. Leonardo said, “This joint investigation is an example of the impact that federal, state and tribal law enforcement agencies can have in disrupting drug trafficking activity in Indian Country when they coordinate their resources.”
FBI Special Agent in Charge Douglas G. Price stated he wanted “to thank our law enforcement partners not only for the assistance they provided during this specific drug operation but the assistance they provide on a regular basis.”
Navajo Nation Captain Harry Sombrero, who currently serves as Director of Criminal Investigations, also said, “The undercover drug investigation was conducted over a period of months and involved hundreds of hours of team investigative work. It is believed that these arrests will have a significant impact on the local drug trafficking network. The credit goes to the field investigators for their commitment, dedication and hard work to keep the community safe.”
Convictions for the drug offenses currently charged, which involve trafficking of methamphetamine and cocaine, carry penalties up to 20 years in prison and $1,000,000 in fines.
Although these individuals have been charged with federal crimes by way of Complaint or Indictment, these charging documents are simply methods by which a person is charged with criminal activity and raise no inference of guilt. An individual is presumed innocent until competent evidence is presented to a jury that establishes guilt beyond a reasonable doubt.The prosecution is being handled byDimitra H. Sampson of Phoenix and Adam Zickerman of Flagstaff, Assistant U.S. Attorneys, District of Arizona.
RELEASE NUMBER: 2014-060_Tuba City
For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.
Monday 27 October 2014
Yucca Valley Man Who Worked at Local Schools Sentenced to 23 Years in Federal Prison in Federal Child Pornography CaseRead the Press Release
RIVERSIDE, California – A school custodian who sexually abused a child over a period of several years and uploaded visual images of the molestations to the Internet has been sentenced to 276 months in federal prison for his conviction on child pornography charges.
Matthew Frazer, 39, of Yucca Valley, was sentenced Friday by United States District Judge Virginia A. Phillips.
Frazer pleaded guilty in July to one count of distribution of child pornography and one count of possession of child pornography. In a plea agreement, Frazer admitted filming the molestation of the victim, who was between 4 and 8 at the time, and uploading the films onto the internet to share with others.
Prior to his arrest on January 31, Frazer was employed as a custodian with the Morongo Unified School District. The victim did not attend the schools where Frazer worked.
The investigation into Frazer was initiated last year after the National Center for Missing and Exploited Children provided to the FBI a series of pornographic images depicting a young girl being sexually abused. For several months, investigators attempted to identify the adult male in the images, and the FBI identified Frazier as the suspect earlier this year.
Frazer pleaded guilty to the two felony charges pursuant to a plea agreement, in which he admitted filming sexual explicit images of the young female victim from 2008 through 2012. He specific admitted making a video in October 2009, when the victim was 6 years old, and again in 2010 when she was 7.
According to court documents, the images have been found in the possession of more than 250 people who collect child pornography. “The magnitude of such
harm to [the victim] is difficult to appreciate and cannot be overstated,” prosecutors wrote in a sentencing memorandum filed with the court.This case is the result of an investigation by the FBI. The following agencies provided assistance during the investigation: the Riverside Police Department, the Riverside County Sheriff’s Department, the San Bernardino Police Department, the San Bernardino County Sheriff’s Department, and the San Bernardino County Probation Department.
Release No. 14-142
Virginia Beach Man Indicted in Major Health Care Fraud of Virginia Medical Assistance ProgramRead the Press Release
NORFOLK, Va. – Baffour E. Opoku, owner and operator of Progressive Counseling Services, LLC, a Virginia Beach based counseling business, and nine other current and former employees were indicted on Wednesday by a federal grand jury for their alleged roles in a scheme to defraud the Virginia Medical Assistance Program. Court documents were unsealed today.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Mark R. Herring, Virginia Attorney General; Royce E. Curtin, Special Agent in Charge of the FBI’s Norfolk Field Office; Clark E. Settles, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Washington; Thomas J. Kelly, Special Agent in Charge, IRS-Criminal Investigation, Washington, D.C. Field Office; and Bill Jones, Special Agent in Charge for the Washington Regional Office of the U.S. Department of Labor’s Office of Inspector General – Office of Labor Racketeering and Fraud Investigations, made the announcement after the defendants made their initial appearances in federal court this afternoon.
The nine of the ten defendants were arrested today, and are currently awaiting further proceedings. The defendants are: Baffour E. Opoku, 48, of Virginia Beach, Virginia; Doretha Selby-Diggs, 40, of Portsmouth, Virginia; Lisa Barrett, 49, of Norfolk; Barbara Bing Banks, 34, of Hampton, Virginia; Corey Etheridge, 42, of Chesapeake, Virginia; Jacqueline Harris, 34, of Portsmouth; Verline Harris, 48, of Virginia Beach; Arlette Johnson, 58, of Virginia Beach; Alfreda Stallion, 52, of Virginia Beach; and Johnny Stallion, 34, of Las Vegas, Nevada.
According to the 105 count indictment, the defendants conspired to obtain reimbursement payments from the Virginia Medical Assistance Program by submitting false claims for mental health support services in 2011 and 2012. Opoku owned and operated Progressive Counseling Services, LLC. He hired the other nine defendants to provide mental health support services to Medicaid-eligible clients in the Tidewater area. According to the indictment, Opoku, along with an unindicted co-conspirator, created fraudulent assessments of Progressive clients to obtain authorization to bill Medicaid for mental health support services. Once Progressive obtained this authorization, Opoku submitted false and fraudulent Medicaid reimbursement claims on behalf of mental health support services purportedly provided by the co-defendants. The indictment alleges these reimbursement claims were bogus because most of the counselors were unqualified to serve as mental health professionals, the counseling sessions never occurred, and progress notes used to document the sessions were fabricated.
In addition, Opoku faces charges that he failed to report nearly $450,000 in taxable income to the IRS over two tax years and that Opoku, along with Doretha Selby-Diggs and Corey Etheridge, submitted false documents to U.S. Citizenship and Immigration Services, part of the Department of Homeland Security, with respect to a pending immigration matter.
The indictment further alleges that Lisa Barrett, Barbara Bing, Jacqueline Harris, and Arlette Johnson testified falsely before a federal grand jury that was investigating this matter.
This case was investigated by the FBI’s Norfolk Field Office; the Medicaid Fraud Control Unit of the Virginia Attorney General’s Office; Homeland Security Investigations (HSI); IRS-Criminal Investigation; and the Department of Labor, Office of Labor Racketeering and Fraud Investigations. Assistant U.S. Attorneys Joseph L. Kosky and V. Kathleen Dougherty are prosecuting the case.
Criminal indictments are only charges and not evidence of guilt. All defendants are presumed to be innocent until and unless proven guilty.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:14-CR-137.Tweet