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2 December 2014
Felon Convicted of Illegally Possessing Handgun and AmmunitionRead the Press Release
ALBANY, NEW YORK – A federal jury in Albany convicted VINCENT JACKSON, age 34, of Brooklyn and Albany, New York, today of illegally possessing a Diamondback DB-9 ninemillimeter pistol and 47 rounds of nine-millimeter ammunition after a four-day trial, announced United States Attorney Richard S. Hartunian and Acting Special Agent in Charge James S. Higgins of the Bureau of Alcohol, Tobacco, Firearms, and Explosives.
JACKSON faces a maximum sentence of imprisonment of ten years, a maximum fine of $250,000, and a three-year term of supervised release. JACKSON, who is held without bond, will be sentenced on April 1, 2015 by United States District Judge Mae A. D’Agostino.
The evidence presented at trial showed that JACKSON, a convicted felon, kept the fullyloaded DB-9 pistol and ammunition in his Albany apartment. JACKSON was on supervised release in connection with a prior federal drug felony when federal probation officers discovered the firearm and ammunition in JACKSON’s bedroom on September 11, 2013. Two cellular phones recovered from JACKSON’s bedroom, both used by JACKSON, contained photographs of the DB-9 pistol found in the bedroom, as well as text messages discussing the DB-9 pistol and other firearms.
This prosecution resulted from an investigation conducted by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, with the assistance of the Albany Police Department, and the United States Probation Office for the Northern District of New York. The case is being prosecuted by Assistant United States Attorney Wayne A. Myers.
Eastern Idaho Man Pleads Guilty to Stealing over $280,000 from His EmployerRead the Press Release
POCATELLO- Matthew Lewis Udy, 45, of Idaho Falls, Idaho, pleaded guilty today to unauthorized use of an access device, U.S. Attorney Wendy J. Olson announced.
According to the plea agreement, Udy was hired in December 2009, in Idaho Falls as a business and financial manager and was entrusted to handle his employer’s personal investments, rental properties, and other financial matters. From April 2011 through September 2013, Udy stole $150,346.52 from his employer related to his employer’s rental properties. Additionally, during the same time period, Udy fraudulently used five credit card accounts belonging to his employer, using the accounts to make unauthorized personal purchases. Udy used the accounts to receive $130,189 in payments or other things of value, including gift cards and hotel rooms. When interviewed by law enforcement, Udy admitted to disguising fraudulent credit card transactions by mirroring legitimate transactions and only paying the accounts with his employer’s funds.
The charge of unauthorized use of an access device is punishable by up to 15 years in prison, a maximum fine of $250,000, and up to three years of supervised release.
Sentencing is set for February 17, 2015, before U.S. District Judge Edward J. Lodge at the federal courthouse in Pocatello.
The case was investigated by the United States Secret Service and the Idaho Falls Police Department.
East St. Louis Resident Pleads Guilty to Possession of Child PornographyRead the Press Release
Follow @SDILNewsStephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today that on December 2, 2014, Steven W. Beckman, 64, East St. Louis, IL, pled guilty to an Indictment charging him with Possession of Visual Depictions of Prepubescent Minors Engaged in Sexually Explicit Conduct. Because Beckman has a similar prior conviction, he faces an increased penalty of not less than ten years but not more than twenty years in federal prison, a fine up to $250,000, and a term of supervised release of not less than five years to life. Beckman’s sentencing is scheduled for March 23, 2015. Beckman has been held without bond since his arraignment on July 22, 2014.
The investigation began in March, 2014, when a detective with the Missouri Internet Crimes Against Children Task Force conducted an investigation which indicated that Beckman uploaded an image of child pornography to his Facebook page. Beckman was on federal supervised release for convictions from 2006 for child pornography offenses.
That same day, United States Probation Officers searched Beckman’s home and seized, among other items, approximately twenty-seven compact disks found in various areas of the house. When asked whether he possessed child pornography on any of the electronic media seized from his home, Beckman stated that there was child pornography mixed into the CD’s as well as on some other electronic media taken from his home.
Results from a federal search warrant revealed that twenty-seven CD’s recovered from the Beckman’s home contained images and video files of minors engaged in sexually explicit behavior, with the majority of the images depicting prepubescent males.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys= Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
The case was investigated by the Missouri Internet Crimes Against Children Task Force, the United States Probation Office and the Federal Bureau of Investigation's Springfield Child Exploitation Task Force. The case is assigned to Assistant United States Attorney Angela Scott.
Dallas Man Faces up to 20 Years in Federal Prison on Federal Child Pornography ConvictionRead the Press Release
DALLAS — A 27-year-old Irving, Texas, man appeared in federal court this morning, before U.S. Magistrate Judge Paul D. Stickney, and pleaded guilty to one count of transporting and shipping child pornography, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
Frank Olivarez, Jr., who is in federal custody, faces a statutory penalty of not less than five or more than 20 years in federal prison, up to a $250,000 fine and a lifetime of supervised release. Sentencing is set for May 4, 2015, before U.S. District Judge Sam A. Lindsay.
According to documents filed in the case, in February 2014, a task force officer with the FBI, who was conducting an investigation into the sharing of child pornography on a BitTorrent file-sharing network, identified a computer that was sharing files containing child pornography. The task force officer downloaded 695 image and video files from Olivarez, 648 of which were child pornography.
The FBI then secured a search warrant that they executed at Olivarez’s home. Olivarez admitted using BitTorrent software to download and view child pornography. Agents seized computer media from the home and further forensic analysis revealed that 33 images depicted the sexual exploitation of infants and toddlers.
The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
The FBI’s Child Exploitation Task Force investigated. Assistant U.S. Attorney Camille Sparks is in charge of the prosecution.
Couple Arrested in ID Theft Scheme Targeting Walmart CustomersRead the Press Release
PITTSBURGH – Two former Butler County residents have been indicted by a federal grand jury in Pittsburgh on charges of conspiracy, Social Security fraud and aggravated identity theft, United States Attorney David J. Hickton announced today.
The 15-count indictment, returned on July 29, 2014 and unsealed today, named Robert W. MacVittie, 33, and Jennifer MacVittie, aka Jennifer Dinwiddie, 31, formerly of Cranberry Twp., Pa., as defendants.
According to the indictment, from around October 2013 through May 2014, the MacVitties’ used cell phone cameras to “shoulder surf” Social Security numbers from Walmart customers nationwide by taking cell phone video images of the customers who were cashing checks at the customer service counters. The stolen information was later used to negotiate counterfeit checks at Walmart stores throughout the U.S., including Pennsylvania, West Virginia, Florida, Texas, Mississippi, Alabama, Kansas and other states. The couple was arrested at a small casino by law enforcement in Nevada on Nov. 29, 2014.
The law provides for a maximum total sentence of not more than 65 years in prison, a fine of $3,750,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Gregory C. Melucci is prosecuting this case on behalf of the government.
The Western Pennsylvania Financial Crimes Task Force conducted the investigation that led to the indictment of Robert and Jennifer MacVittie. The WPFCTF was established as a collaborative, multi-agency effort to effectively combat financial crimes, including identity fraud, in Western Pennsylvania. Partnering in this effort are the U.S. Attorney's Office for the Western District of Pennsylvania, the United States Secret Service, the United States Postal Inspection Service, the Department of Homeland Security, the Allegheny County District Attorney's Office, the Allegheny County Police Department, the City of Pittsburgh Bureau of Police and the Pennsylvania State Police.
An indictment is an accusation. The defendants are presumed innocent unless and until proven guilty.
Cleveland Man Indicted for Identity Theft and Credit Card FraudRead the Press Release
A Cleveland man was indicted today for operating an identity theft and credit card fraud scheme in which he defrauded 10 companies out of nearly $270,000, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland Office.
Paul R. Tomko, 41, was indicted on 10 counts of bank fraud, nine counts of access device or credit card fraud, one count of aggravated identity theft, and one count of wire fraud. Tomko is accused of defrauding nine financial institutions out of $256,797 and one company out of $13,247 in 2013. He did this through the unauthorized use of another’s personal identification to obtain credit cards and lines of credit in that person’s name, according to the indictment.
Tomko approached someone identified as J.S. and sought financial assistance in paying for a lawn mower for the maintenance of property Tomko had in the Cinema Park Development, as required by the city of Warrensville Heights. Tomko obtained J.S.’s personal identification information in the process. Tomko then obtained nine credit cards and opened lines of credit in the name of J.S., and in the name of J.S.’s company, JMS Services Corporation, using the personal information of J.S. without J.S.’s authorization or knowledge, according to the indictment.
Tomko, without the authorization or knowledge of J.S., used the credit cards and lines of credit in the name of J.S. and JMS Services Corporation for Defendant’s own personal use, thereby running up a balance due and owing on each of these credit cards and lines of credit. Once Tomko ran up a balance on these credit cards, he then engaged in a scheme in which he made a payment on each of these credit cards with a worthless check or using an intentionally incorrect account number, thereby keeping the line of credit in place, or even increasing the line of credit with the appearance of a payment. Once Tomko’s check or payment was dishonored or returned, Tomko ceased to make any payments, leaving the financial institutions with a loss.
As a result of this scheme, the indictment charges that Tomko caused losses to the below listed financial institutions in the following approximate amounts:
Financial Institution
Amount
Key Bank
$63,629.72
$42,791.35
FNBO
$9,415.00
AmEx
$16,358.16
US Bank
$33,522.02
Barclays
$28,286.74
GE Capital
$10,000.00
Fifth Third
$23,894.84
Capital One
$28,899.67
Total
$256,797.50
Some of the unauthorized charges made by Tomko included payments by Tomko for the Cinema Park development property taxes ($33,882 and $26,252); the payment to Tomko’s defense attorneys to represent him in a criminal case ($8,700, $6,000 and $5,500); the payment of $10,000 to a physician for a medical procedure for Tomko; and numerous payments to Tomko as Dr. Paul Tomko. In the wire fraud charge, Tomko also used email communication to set up an unauthorized account, through JMS Services, to defraud Balboa Capital, an equipment leasing company in California, out of approximate $13,247, according to the indictment.
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. 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 violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The case is being prosecuted by Assistant U.S. Attorneys Christian H. Stickan and Christos N. Georgalis following investigation by the FBI, Cleveland Office.
Bowie Man Sentenced in Residential Mortgage Fraud SchemeRead the Press Release
Used Another Individual’s Identity, False Income and Credit Information to Induce a Lender to Provide a Home Mortgage Loan
Greenbelt, Maryland – U.S. District Judge George J. Hazel sentenced Abdallah Suleiman Kitwara, age 44, of Bowie, Maryland today to 15 months in prison followed by five years of supervised release for conspiring to commit wire fraud arising from a residential mortgage fraud scheme. Judge Hazel also ordered Kitwara to pay restitution of $290,954 and a fine of $50,000.The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Cary A. Rubenstein of the Housing and Urban Development Office of Inspector General - Office of Investigations; Inspector General Laura S. Wertheimer of the Federal Housing Finance Agency Office of Inspector General; Special Agent in Charge Kathy Michalko of the United States Secret Service – Washington Field Office; John L. Phillips, Assistant Inspector General for Investigations, U.S. Department of the Treasury - Office of Inspector General; and Special Agent in Charge William Winter of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI).
According to his plea agreement, from March 2007 to November 2008, Kitwara conspired with real estate agent Tibakweitira and others to unlawfully use the identity of another individual to buy residential property. For example, in May and June 2007, Kitwara used the stolen identity of another person, along with false income statements and credit information, to buy a residence in Washington, D.C. The conspirators inflated the sales price by creating false documents for repairs and renovations that were never made. After the settlement, the conspirators divided up the cash received for the purported repairs.
As a result of the conspiracy, Kitwara caused $290,954 in losses to the bank that was the lender for purchased property.
Edgar Tibakweitira, a/k/a “Edgar Julian,” “Charles Edgar Tibakweitira,” and “Edgar Gaudious Tibakweitira,” age 46, of Severn, Maryland previously pleaded guilty to the conspiracy and to aggravated identity theft. Tibakweitira has agreed to forfeit a Range Rover vehicle, and awaits sentencing.
Five other conspirators from Maryland have also pleaded guilty to their roles in the scheme, including: Tibakweitira’s wife Flavia Makundi, age 42, of Severn; Raymond Abraham, age 47, of Silver Spring,; Ayoub Luziga, age 36, of Bowie; Cane Mwihava, age 44, of Bowie; and Mokorya Cosmas Wambura, age 41, of Takoma Park. Abraham was sentenced on October 27, 2014 to 33 months in prison, and Luziga was sentenced on November 24, 2014 to 21 months in prison. Abraham and Luziga were both ordered to pay restitution of $999,726.55. Wambura was sentenced to five years in prison and ordered to pay restitution of more than $400,000. Mwihava is scheduled to be sentenced on December 27, 2014 at 11:30 a.m.
A jury convicted Annika Boas, age 37, of Mount Rainier, Maryland on September 19, 2014, for conspiracy, wire fraud and making a false statement on a loan application, arising from the scheme. Boas is scheduled to be sentenced on January 7, 2015 at 9:00 a.m.
The Maryland Mortgage Fraud Task Force was established to unify the agencies that regulate and investigate mortgage fraud and promote the early detection, identification, prevention and prosecution of mortgage fraud schemes. This case, as well as other cases brought by members of the Task Force, demonstrates the commitment of law enforcement agencies to protect consumers from fraud and promote the integrity of the credit markets. Information about mortgage fraud prosecutions is available www.justice.gov/usao/md/Mortgage Fraud/index.html.
Today's announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.United States Attorney Rod J. Rosenstein praised HUD-OIG, FHFA-OIG, Treasury OIG, U.S. Secret Service and HSI Baltimore for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Kristi N. O’Malley and Special Assistant U.S. Attorney Kevin DiGregory, Investigative Counsel for the Federal Housing Finance Agency Inspector General, who prosecuted the case.
Augusta, WV Woman Charged in Methamphetamine Manufacturing OperationRead the Press Release
1125 Chapline Street, Federal Building, Suite 3000 ● Wheeling, WV 26003
(304) 234-0100 ● Contact: Tara Tighe, Public Affairs SpecialistMARTINSBURG, WEST VIRGINIA – Cathy Ann Corbin, 50, of Augusta, West Virginia, was convicted for her role in producing methamphetamine, United States Attorney William J. Ihlenfeld, II, announced today.
During an investigation by the Potomac Highlands Drug and Violent Crime Task Force, Corbin was discovered in possession of pseudoephedrine in January 2013 near Romney, West Virginia. She admitted her role in the manufacture of methamphetamine when she pled guilty to one count of “Possession of Pseudoephedrine to be used in Manufacture of Methamphetamine.”
Corbin faces up to twenty years in prison and a fine of up to $250,000.00. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Jarod Douglas prosecuted the case on behalf of the government.
U.S. Magistrate Judge Robert W. Trumble presided.
Antigo Man Sentenced for Federal Drug CrimeRead the Press Release
United States Attorney James L. Santelle of the Eastern District of Wisconsin, announced that John M. Hunter (age: 36) of Antigo, Wisconsin, was sentenced to 30 months in federal prison by Chief United States District Court Judge William C. Griesbach. Hunter had previously pled guilty to a single count of conspiracy to distribute controlled substances in violation of Title 21 United States Code, Sections 846 and 841(b)(1)(B), and Title 18 United States Code, Section 2.
Hunter was responsible for the distribution of over 50 kilograms of marijuana and over 1,500 grams of cocaine in the Langlade County area and in southeastern Wisconsin between May 2009 and August 2011. Hunter’s drug distribution network included numerous employees of the Merrill and Antigo School Districts, many of whom were charged in state court for drug related crimes.
In pronouncing sentence Chief Judge Griesbach noted the serious nature of the offense, the effect that Hunter’s actions had on his community, and the scourge that illegal drugs present to society. In addition to his prison sentence, Hunter was placed on 48 months of supervised release.
This case was investigated by the Langlade and Marathon County Sheriffs’ Departments. This case was prosecuted by Assistant United States Attorney Daniel R. Humble.
Alleged PCP Distributor Who Shot A DEA Agent Arraigned on Federal Narcotics and Assault ChargesRead the Press Release
COLUMBIA, SC – Joel Perrin Robinson has been arraigned on federal drugs and weapons charges in relation to the shooting of a DEA Agent while a search warrant was being executed at his home on October 20, 2014.
“This defendant is charged with opening fire on federal agents while they were serving a federal narcotics search warrant. A DEA Special Agent was seriously injured,” said United States Attorney Sally Quillian Yates. “This office will continue to work with its law enforcement partners to ensure that he is held accountable for his actions.”
John S. Comer, the Acting Special Agent in Charge of the DEA Atlanta Field Division stated, “The wounding of our agent during the execution of a Federal Search Warrant reinforces the daily dangers law enforcement officers face while conducting narcotics investigations. The DEA will work closely with our federal, state and local counterparts to assist the US Attorney’s Office in the prosecution of this matter.”
David A. Thomas, Special Agent in Charge of the FBI’s Columbia Field Office said, “This case is the result of an unfortunate reality that happens far too often to law enforcement officers working selflessly to make our communities safer. It is a grim reminder of the violence associated with the illegal drug trade and the dangers faced by law enforcement officers trying to stop it.”
According to United States Attorney Yates, the charges, and other information presented in court: Beginning in 2007, Robinson, along with co-conspirators Coleman Warnock and Adrian Banks (both have been charged with narcotics offenses in the Northern District of Georgia) allegedly purchased, stored, brokered, distributed and used a number of chemicals, including piperidine, a PCP precursor, to manufacture large quantities of PCP, a controlled substance. At the direction of Warnock, Banks transported chemicals used to manufacture PCP from the Atlanta, Ga., area to Robinson, who stored the chemicals at his residence in Orangeburg, SC. Then, Robinson, Warnock and Banks allegedly transported chemicals used to manufacture PCP from South Carolina to other jurisdictions.
On July 6, 2013, Warnock and two other individuals were processing chemicals associated with PCP manufacturing at a residence located in Fairburn, Ga. On that date, a green GMC Canyon pickup truck registered to a relative of Robinson was located at the residence, along with two trailers which had been used by Warnock, Banks, and Robinson to transport chemicals associated with PCP manufacturing. One of the trailers was purchased and titled in the name of a relative of Robinson. At some point during the processing of the chemicals, a fire erupted and burned for two days - destroying the residence.
On or about December 4, 2013, at the direction of Warnock, another individual transported a trailer which contained, among other items, 55-gallon drums of piperidine to Robinson’s Orangeburg residence.
On October 20, 2014, at approximately 6:15 a.m., DEA Special Agents and Task Force Agents were executing a federal search warrant to search Robinson’s Orangeburg residence for evidence of a drug trafficking crime while announcing “police, search warrant” in a loud and continuous manner. The indictment alleges that Robinson fired four shots from his bedroom. Then, he walked out of his bedroom into the pool area of the residence. At that time, Robinson allegedly used a laser sight on his .45 caliber pistol and fired an additional two rounds at DEA agents who were part of the search warrant team, providing coverage for agents executing the search warrant in the garage area. One of the rounds fired by Robinson struck a DEA Special Agent in the right elbow, causing the agent serious injury. Robinson then surrendered to law enforcement and was placed under arrest.
During the search of the residence, agents also located an AR-15 rifle with three magazines and Aim Shot scope, a 16-gauge shotgun, a semi-automatic rifle, a .22 caliber semi-automatic rifle, a 12-gauge shotgun, a bolt action rifle, a .22 caliber revolver, a .38 caliber revolver with laser grip sight, and a 380 handgun with magazine and laser sight. A bulletproof vest was also recovered from Robinson’s bedroom.
A federal grand jury seated in the District of South Carolina returned the indictment for Joel Perrin Robinson, 32, of Orangeburg, SC., on November 20, 2014. He was arraigned before a United States Magistrate Judge in Columbia, SC.
The United States Attorney’s Office for the Northern District of Georgia is handling the prosecution of Robinson as the United States Attorney’s Office for the District of South Carolina has voluntarily recused itself from the case.
Members of the public are reminded that the indictment only contains charges. The defendant is presumed innocent of the charges and it will be the government’s burden to prove the defendant’s guilt beyond a reasonable doubt at trial.Special Agents and Task Force Agents of the Drug Enforcement Administration and the Federal Bureau of Investigation are conducting the investigation of this case. Valuable assistance was also provided by the Georgia Bureau of Investigation, Georgia State Fire Marshal’s Office, Fulton County Fire Department, Atlanta Fire Department, Snellville Police Department, Henry County Sheriff’s Department, Clayton County Sheriff’s Office, South Carolina Law Enforcement Division (SLED), Richland County Sheriff’s Department, Lexington County Sheriff’s Department, Kershaw County Sheriff’s Department, Orangeburg County Sheriff’s Office, Fifth Circuit Solicitor’s Office, and the Columbia Police Department.
Assistant United States Attorneys Michael Herskowitz, and Vivek Kothari, who have been admitted as Special Assistant U.S. Attorneys in the District of South Carolina, are prosecuting the case.
The U.S. Attorney’s Office in Atlanta recommends parents and children learn about the dangers of drugs at the following web site: www.justthinktwice.com.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao/gan/.
Albuquerque Woman Sentenced to Federal Prison for Bank Fraud and Identity Theft ConvictionRead the Press Release
ALBUQUERQUE – Christina Knight, 30, of Albuquerque, N.M., was sentenced yesterday afternoon to 32 months in federal prison followed by five years of supervised release for her conviction on bank fraud and aggravated identity theft charges.
Knight and her co-defendants, Raymundo Silva, 35, and Patricia Diaz, 36 both of Los Lunas, N.M., were indicted in Aug. 2013, on conspiracy, bank fraud and aggravated identity theft charges. The trio subsequently was charged in a 31-count superseding indictment alleging conspiracy to commit bank fraud; 24 counts of bank fraud, including eight counts against Silva, three counts against Diaz, and 13 counts against Knight; and six counts of aggravated identity theft against Knight.The superseding indictment generally charged Silva, Diaz and Knight with engaging in a scheme to commit bank fraud between Dec. 2011 and April 2013. According to the superseding indictment, Knight, Silva and Diaz perpetuated the scheme by stealing checks from residential mailboxes, altering the names of payees and the amounts on the checks, and cashing the checks using either their own identities or, in the case of Knight, the identities of others.
Knight entered guilty pleas on Feb. 20, 2014, to the bank fraud conspiracy, 13 substantive bank fraud charges, and one count of aggravated identity theft. Earlier, on Oct. 28, 2013, Diaz entered a guilty plea to the bank fraud conspiracy and three substantive bank fraud charges. Silva was convicted on Feb. 27, 2014, on the bank fraud conspiracy and five substantive bank fraud charges after a four-day jury trial.
According to court records and trial evidence, in Dec. 2011, a Los Lunas police officer investigating a check washing and identity theft ring targeted a sedan seen leaving a Los Lunas bank following a failed attempt to cash a fraudulent check. In Feb. 2012, after surveillance established that the sedan frequently visited a residence in Belen, Los Lunas police officers executed a search warrant at the residence and seized chemicals and other products commonly used to wash and alter checks, several driver’s licenses, college IDs and Social Security cards, bank receipts and other evidence.
Investigation by Homeland Security Investigations (HSI) and the Los Lunas Police Department identified Silva, Diaz and Knight as the members of the bank fraud scheme in late 2012, following the theft of five checks from the mailbox of a Los Lunas residence. Silva cashed one of the checks on Dec. 26, 2012, and between Dec. 20, 2012 and Jan. 4, 2013, Knight cashed three of the checks by using the identification of another person. Each of these four checks had been altered by changing the name of the payee and amount. Laboratory analysis by HSI revealed that the chemicals seized from Silva’s residence were used to wash the checks.
Silva was sentenced on Aug. 1, 2014, to 30 months in federal prison followed by five years of supervised release.Diaz was sentenced on March 18, 2014, to 62 days of time-served followed by five years of supervised release and was ordered to pay $400.00 in restitution. On June 5, 2014, Diaz was arrested for violating the conditions of her supervised release. She was sentenced on July 10, 2014, to three months in custody followed by four years of supervised release.
This case was investigated by the Albuquerque office of HIS, the Los Lunas Police Department and Albuquerque Police Department, and was prosecuted by Assistant U.S. Attorneys Norman Cairns and Paul Mysliwiec.
1 December 2014
“No-Show” Doctor Pleads Guilty in Connection with $13 Million Health Care Fraud SchemeRead the Press Release
BROOKLYN, NY – Connecticut resident Dr. Okon Umana, 67, pleaded guilty today in federal court in the Eastern District of New York to conspiring to defraud the United States in connection with his role as a “no show” doctor in a $13 million health care fraud scheme. Dr. Umana is the last of nine defendants charged to plead guilty in connection with the scheme at the Cropsey Medical Care PLLC clinic in Bensonhurst, Brooklyn.
Today’s guilty plea was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York; Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division; George Venizelos, Assistant Director-in-Charge, Federal Bureau of Investigation (FBI), New York Field Office; and Thomas O’Donnell, Special Agent-in-Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG).
“Dr. Umana dishonored his medical license when he fraudulently billed Medicare and Medicaid at the taxpayers’ expense,” stated United States Attorney Lynch. “Dr. Umana is the final defendant to be convicted in connection with the government’s investigation of the Cropsey Medical Care clinic, which submitted more than $13 million in fraudulent claims to Medicare and Medicaid. We will continue to investigate and prosecute fraud to protect the integrity of these vital health care programs.” U.S. Attorney Lynch extended her grateful appreciation the Federal Bureau of Investigation and the Department of Health and Human Services, Office of Inspector General, for their outstanding work on the investigation.
According to court documents, from 2009 to 2012, Umana was the medical director of the Cropsey Medical Care clinic. Patients at Cropsey Medical received medically unnecessary physical therapy, diagnostic testing and other services, which were provided by a physician assistant who was acting without supervision. Such purported medical services were then fraudulently billed by Cropsey Medical to Medicare and Medicaid under Dr. Umana’s provider number. From approximately November 2009 to October 2012, Cropsey Medical submitted more than $13 million in claims to Medicare and Medicaid, seeking reimbursement for a wide variety of fraudulent medical services and procedures, including physician office visits, physical therapy and diagnostic tests that were not medically necessary and often did not even occur.
Dr. Umana pleaded guilty before U.S. District Judge John Gleeson. At sentencing on April 15, 2015, Dr. Umana faces a maximum penalty of five years in prison, a fine of over $250,000, restitution of up to $6,429,330 and forfeiture of $6,550,036.
The case was investigated by the FBI and HHS-OIG, brought as part of the Medicare Fraud Strike Force, and supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of New York. The case is being prosecuted by Assistant U.S. Attorney Shannon C. Jones of the Eastern District of New York and Trial Attorney Sarah M. Hall of the Criminal Division’s Fraud Section.
The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to prevent and deter fraud and enforce anti-fraud laws around the country. Since its inception in March 2007, the Strike Force, now operating in nine cities, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Team (HEAT), go to: www.stopmedicarefraud.gov
The Defendant:
OKON UMANA
Age: 67
West Haven, Connecticut
E.D.N.Y. Docket No. 12 CR 617 (S-1)
Washington County Man Sentenced to 60 Months in Prison for Receiving Child PornographyRead the Press Release
Defendant Used his Computer and the Internet to Download and Save Dozens of Child Pornography Files
ALBANY, NEW YORK – TIMOTHY TEFFT, age 65, of Greenwich, New York was sentenced on November 25, 2014 to 60 months of imprisonment for receiving child pornography by Chief United States District Court Judge Gary L. Sharpe, announced United States Attorney Richard S. Hartunian and Andrew W. Vale, Special Agent-in-Charge, Federal Bureau of Investigation, Albany Division. TEFFT, who had entered a guilty plea on May 2, 2014, was also ordered to serve a fifteen year term of supervised release, to have no unsupervised contact with minors, and to register with the New York State Sex Offender Registry Program.
Between January 1, 2009 and May 3, 2011, TEFFT used a computer to access the Internet to download and save dozens of files that contained child pornography. TEFFT also transferred some of these child pornography files onto portable storage devices for viewing at a later time.
This case was investigated by the Federal Bureau of Investigation. This case was prosecuted by Assistant United States Attorney Rick Belliss.
Warwick Man Sentenced to Nearly 24 Years in Prison for Exploitation of 7-Year-Old ChildRead the Press Release
PROVIDENCE, R.I. – Sean Keener, 27, of Warwick, R.I., was sentenced today to 286 months in federal prison for exploiting a 7-year-old child by producing and distributing pornographic images and videos of the child, some of which were posted on a Russian file-sharing web site, announced United States Attorney Peter F. Neronha; Bruce M. Foucart, special agent in charge of Homeland Security (HSI) Investigations for New England; and Warwick Police Chief Colonel Stephen M. McCartney.
At sentencing, U.S. District Court Judge John J. McConnell, Jr., also ordered Keener to serve lifetime supervised release upon completion of his prison term. Keener pleaded guilty on March 24, 2014, to an indictment charging him with one count each of production, possession and distribution of child pornography. No plea agreement was filed in this case.
In June 2013, HSI agents in Boston seized digital storage drives which contained photographs depicting child pornography, including sexually explicit photographs of a 7-year-old girl from Rhode Island. HSI agents also discovered an email address later linked to Sean Keener and to a folder he created on a Russian file-sharing website which contained numerous pictures of the same child. With the assistance of the Warwick Police Department, both Keener and the girl depicted in the photographs were identified as residents of Rhode Island.
A court authorized search by HSI agents and Warwick Police of a residence where Keener was staying resulted in the seizure of two computers and two cell phones belonging to Keener which contained more than 5,100 images and 586 videos depicting minors engaged in sexually explicit conduct.
United States Attorney Peter F. Neronha commented, “There are some cases that leave one almost speechless. This is just such a case. That a person entrusted with the care of a child, with no higher responsibility than to protect that child from harm, would instead victimize her in such a horrific way, is just reprehensible. Today’s long prison sentence is entirely deserved, yet no jail sentence, however long, can restore what this child has lost.”
“Crimes against children are some of the most heinous we encounter,” said Bruce Foucart, special agent in charge of HSI Boston. “I sincerely hope this sentencing serves as a first step in the recover process for the victim. Fortunately, as a result of our collaboration with federal, state, and local law enforcement partners, this child predator can no longer victimize innocent children.”
The case was prosecuted by Assistant U.S. Attorney Lee H. Vilker.
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[email protected]United States Files Suit Against Air Ideal and its Owner for Allegedly Submitting False Claims Under Historically Underutilized Business Zone ProgramRead the Press Release
The United States has filed a complaint against Orlando, Florida, based Air Ideal Inc. and its owner, Kim Amkraut, for allegedly making false statements to the Small Business Administration (SBA) to obtain certification as a Historically Underutilized Business Zone (HUBZone) company, the Justice Department announced today.
“The HUBZone program is intended to create jobs in areas that have historically had trouble attracting business,” said Acting Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division. “This suit demonstrates that the United States will hold accountable those who knowingly violate the requirements of this vital program.”
“The HUBZone procurement program imposes very clear requirements upon contractors that must be followed,” said U.S. Attorney A. Lee Bentley III for the Middle District of Florida. “By intervening in this case, we reaffirm our commitment to maintaining the integrity of vital programs such as these, which undergird our economy.”
Under the HUBZone program, companies that maintain their principal office in a designated HUBZone and meet certain other requirements can apply to the SBA for certification as a HUBZone small business company. HUBZone companies can then use this certification when bidding on government contracts. In certain cases, government agencies will restrict competition for a contract to HUBZone-certified companies.
The complaint alleges that Air Ideal and Kim Amkraut originally applied to the HUBZone program in 2010 by claiming that Air Ideal’s principal office was located in a designated HUBZone. The complaint further alleges that, in fact, this location was a “virtual office” where no Air Ideal employees worked and Air Ideal was actually located in a non-HUBZone location. Allegedly, the defendants not only misrepresented the location of Air Ideal’s principal office to the SBA, but also submitted to the SBA a fabricated lease agreement for its purported HUBZone office.
The complaint alleges that Air Ideal used its fraudulently-procured HUBZone certification to obtain contracts from the U.S. Coast Guard, U.S. Army, U.S. Army Corps of Engineers and the U.S. Department of Interior that were worth millions of dollars. Each of those contracts had been set aside for qualified HUBZone companies. The complaint asserts claims against Air Ideal and Kim Amkraut under the False Claims Act and the Financial Institutions Reform, Recovery, and Enforcement Act of 1989.
“The HUBZone Program offers significant benefits to eligible small businesses and is an important tool for unlocking the potential of historically underutilized business zones,” said Inspector General Peggy E. Gustafson for the SBA. “Preferences for federal contract awards must not be given to persons who lie in order to claim eligibility. This type of fraud undermines confidence in the HUBZone Program and other small business set-aside contract programs.”
The United States filed its complaint in a lawsuit filed under the qui tam or whistleblower provisions of the False Claims Act. Under the act, a private citizen can sue on behalf of the United States and share in any recovery. The United States is entitled to intervene in the lawsuit, as it has done here.
This matter was handled by the Civil Division’s Commercial Litigation Branch and the U.S. Attorney’s Office for the Middle District of Florida, in conjunction with the SBA’s Office of Inspector General and Office of General Counsel, the U.S. Department of Homeland Security’s Office of Inspector General and the Defense Criminal Investigative Service.
The case is U.S. ex rel. Hopson v. Air Ideal, Inc. and Kim Amkraut, No. 6:13-cv-775-Orl-37GJK (M.D. Fla.).
The claims asserted against Air Ideal and Kim Amkraut are allegations only, and there has been no determination of liability.
United States Attorney Announces Financial Recoveries of over $14 Million in Eastern Wisconsin and over $24 Billion Nationwide on Behalf of United States TaxpayersRead the Press Release
United States Attorney James L. Santelle today announced that, in Fiscal Year 2014 (October 1, 2013, through September 30, 2014), the Eastern District of Wisconsin Office collected $14,054,999.07 in criminal and civil collections and in asset forfeiture actions. This amount includes $2,530,748.94 in criminal cases, $4,581,800.13 in civil matters, and $6,942,450.00 in forfeiture proceedings.
Santelle announced further that, in its partnered work with other United States Attorneys’ Offices and litigating components of the United States Department of Justice, the Office of the United States Attorney in Eastern Wisconsin collected an additional $731,108.81. Of this amount, $16,492.71 was collected in criminal actions, and $714,616.64 was collected in civil actions. The combined, total financial recovery of more than $14 million is more than twice the annual budget for the operation of the entire office in Eastern Wisconsin.
Today’s announcement of total financial recoveries in Eastern Wisconsin follows the related announcement by Attorney General Eric H. Holder, Jr. that, in this same time period—that is, Fiscal Year 2014—the Department as a whole collected $24.7 billion in civil and criminal actions. The more than $24 billion in collections in FY 2014 represents nearly eight and a half times the appropriated $2.91 billion budget for the 94 United States Attorneys’ Offices nationwide and the Washington-based litigating divisions for Fiscal Year 2014.“Every day, the Justice Department’s federal prosecutors and trial attorneys work hard to protect our citizens, to safeguard precious taxpayer resources, and to provide a valuable return on investment to the American people,” said Attorney General Holder. “Their diligent efforts are enabling us to achieve justice and recoup losses in virtually every sector of the U.S. economy. And this result shows the fruits of the Justice Department’s tireless work in enforcing federal laws; in protecting the American people from violent crime, national security threats, discrimination, exploitation, and abuse; and in holding financial institutions accountable for their roles in causing the 2008 financial crisis.”
Joining the Attorney General in these significant announcements, Santelle commented: “I am proud of the highly professional, dedicated, and productive work of my staff—including all of our criminal and civil attorneys and our equally stellar professional support personnel—who are collectively responsible for bringing into the coffers of the United States Treasury these significant sums on behalf of our constituents—the people of the Eastern District of Wisconsin. In our daily efforts to enforce the many civil and the criminal judgments entered in favor of the United States of America, we are aggressive yet even-handed, purposeful yet fair, and creative yet balanced in meeting one of our principal missions—that is, collecting monies due and owing to the federal government.”
The Offices of the United States Attorneys, along with the Department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts that are owed to the United States and that are due to victims of various types of financial crimes. Federal law contemplates that defendants convicted of crimes pay restitution to those victims who have suffered physical injuries or financial losses. While restitution is paid directly to the victims, criminal fines and related assessments are paid to the United States Department of Justice’s Crime Victims Fund, which, in turn, distributes monies to state victim compensation and victim assistance programs. Similarly, forfeited assets—the product of joint work with federal, state, and local law enforcement offices and units—are deposited into the Department’s Justice Assets Forfeiture Fund, from which they are used to restore monies to crime victims and to support a variety of equally beneficial law enforcement missions and goals.
Santelle explained further: “As in past years, our affirmative civil docket continues to generate significant sums of money which we recover in pursuing fraud and other types of misconduct in the administration of federal dollars; these sums also include fines and penalties imposed on individuals and corporations for their proven violations of federal health care, safety, civil rights, environmental, education, and other program-type laws.” These civil monetary obligations are enforced by the Office of the United States Attorney on behalf of many federal agencies—including but not limited to the United States Department of Agriculture, the United States Department of Education, the United States Department of Health & Human Services, the United States Department of the Treasury (including the Internal Revenue Service), and the United States Small Business Administration.Santelle concluded: “In their focused and effective invocation of federal civil and criminal mechanisms and administrative processes, the staff of our Financial Litigation Unit, the staff of our Asset Forfeiture Unit, and our industrious colleagues in the many federal agencies that we represent collaboratively recover and return significant amounts of money on behalf of the people of this district. Our enforcement actions not only promote the rule of law and serve the ends of justice but also confirm that investment in and support of the mission and the purpose of United States Attorneys’ Offices is sound and beneficial.”
For further information about the information and commentary in this release, please contact Public Information Officer Dean Puschnig, Office of the United States Attorney, at (414) 297-1700, or at [email protected].
Two Insurance Agents Plead Guilty in Statewide Fake Insurance Scheme Involving Underground Storage TanksRead the Press Release
The EPA and FBI disrupted the scheme in a joint undercover operation
GRAND RAPIDS, MICHIGAN – The Environmental Protection Agency and the Federal Bureau of Investigation have uncovered and disrupted a scheme involving the fabrication of insurance certificates that were sold to owners and operators of underground storage tanks (“USTs”) throughout the state of Michigan. The fake documents made it appear that certain USTs were in compliance with laws requiring owners and operators of USTs to demonstrate the ability to clean up any environmental contamination caused by a leaking tank. Two insurance agents in Lansing, Michigan, have pled guilty for their roles in creating and selling fake insurance certificates to owners and operators of USTs.
Federal and state law requires owners and operators of certain underground storage tanks to obtain proof of financial assurance in the event of a release into the environment. Most owners and operators comply with the law by obtaining an annual insurance policy that would cover up to $1 million in clean-up costs and damages. The fake document scheme, which ran from 2011 to 2013, primarily involved gas stations with underground storage tanks that were either uninsurable due to age or condition, or were expensive to insure due to their age. Rather than replace the aging tanks, UST owners and operators purchased fake insurance certificates created by two Lansing insurance agents that made it appear to federal and state UST inspectors that the USTs were in compliance with the law. In reality, those gas stations had no insurance in the event of a leak.
The scheme was disrupted after undercover operations conducted by the EPA and FBI in the Lansing area successfully infiltrated the fraudulent creation and sale of fake documents by Allen P. Chadderdon, of Williamston, Michigan, and Dean P. Tucker, of Lansing, Michigan. Immediately upon disrupting the scheme, the EPA and State of Michigan sought to identify which USTs were not in compliance with the financial assurance requirements to mitigate the risk of harm to the environment. Gas stations that failed to present a genuine insurance policy were shut down until the owner or operator demonstrated compliance with the law.
Chadderdon and Tucker pled guilty in federal court to fabricating insurance certificates that they sold to UST owners and operators. Federal law prohibits altering or fabricating documents with the intent to impede, obstruct, or influence the proper administration of any matter that is within the jurisdiction of a federal agency. Both defendants face a maximum of 20 years in prison for the offense, but the Court will determine the sentence after considering the federal sentencing guidelines and the statutory sentencing factors. Chadderdon will be sentenced on December 3, 2014, and Tucker will be sentenced on March 5, 2015.
U.S. Attorney Patrick Miles, Jr. said, “This fraud scheme presented a serious risk of harm to many communities across Michigan. Residents of more than 30 different cities — including Battle Creek, Lansing, Ann Arbor, and Detroit — were exposed to the risk of leaking underground storage tanks where no insurance was available to pay for clean-up costs or injuries. Fuel and oil that leaks from underground storage tanks threatens not only the land surrounding the tank, but can harm drinking water and our state’s rivers and lakes. This investigation and criminal case helps ensure that owners and operators of USTs comply with the law and those who knowingly help others evade the law will be brought to justice.”
“About half of the nation’s population gets its drinking water from groundwater supplies,” said Randall K. Ashe, Special Agent in Charge of EPA’s criminal enforcement program in Michigan. “Leaking underground storage tanks pose a significant threat to the quality and safety of that groundwater. To protect human health and the environment, EPA must receive accurate and honest documents. These recent pleas demonstrate that insurance agents who callously place the American people at risk by falsifying official certificates will be held accountable for their actions.”
“The perpetrators’ fraudulent scheme to mislead federal and state inspectors placed several Michigan communities in harm’s way and exposed these areas to the risk of leaking fuel and oil from underground storage tanks throughout the state,” said Paul M. Abbate, Special Agent in Charge of the FBI Detroit Field Office. “The FBI, along with our federal, state and local partners, remains vigilant in its efforts to bring to justice those who actively assist others in evading the law and expose our communities to potential harm.”
The underground storage tank cases are being prosecuted by Assistant U.S. Attorney Christopher O’Connor.
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Toxic Marijuana Grow Nets 10-Year Prison TermRead the Press Release
FRESNO, Calif. — Hernan Cortez Villasenor (Cortez), 40, of Michoacàn, Mexico, was sentenced today to 10 years in prison for his involvement in a toxic marijuana cultivation operation in the Greenhorn Creek area of the Sequoia National Forest in Kern County, United States Attorney Benjamin B. Wagner announced. Cortez was also ordered to pay $3,328 in restitution to the U.S. Forest Service for the damage caused by his marijuana cultivation operation.
On July 7, 2014, Cortez pleaded guilty to conspiring to manufacture, distribute and possess with intent to distribute marijuana and distributing unregistered pesticides, in violation of the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA). According to court documents, Cortez supplied toxic rat poison and other chemicals and materials to support the 8,876 marijuana plants growing on public land. The site sustained extensive damage as a result of the cultivation activities. Native oak trees and other vegetation were cut down or otherwise killed to make room for the marijuana plants. The soil was tilled, and fertilizers and pesticides, including Fosfuro de Zinc, a common Mexican rat poison containing zinc phosphide, were spread throughout the site. Law enforcement officers also found 30 containers of Fosfuro de Zinc at Cortez’s residence in Arvin, California.
The EPA has designated zinc phosphide as a restricted-use pesticide, which means that it may only be purchased and used by, or under the supervision of, a certified applicator. Zinc phosphide is banned for residential sale due to its acute toxicity. A single swallow can be fatal to a small child.
Upon completion of his prison sentence, Cortez is subject to deportation to Mexico.
This case was the product of an investigation by the U.S. Forest Service, U.S. Drug Enforcement Administration, the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), U.S. Environmental Protection Agency Criminal Investigation Division (EPA-CID), and the Kern County Sheriff’s Office. Assistant United States Attorney Karen Escobar prosecuted the case.
Torrington Resident Sentenced to Federal Prison for Role in Real Estate Fraud Schemes, Obstructing JusticeRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that THOMAS PROVENZANO, 48, of Torrington, was sentenced today by U.S. District Judge Janet Bond Arterton in New Haven to 18 months of imprisonment, followed by five years of supervised release, for his role in a series of fraudulent real estate transactions.
According to court documents and statements made in court, in November 2005, PROVENZANO obtained a $923,200 loan to purchase a lakefront home located at 27 Palmer Road in Morris for more than $1.1 million, despite lacking the income and savings to pay off the mortgage. The property was owned by an entity controlled by a co-conspirator and, on the mortgage loan application, PROVENZANO falsely listed his employment with a company owned by his co-conspirator. In fact, PROVENZANO never worked at the company. The application also falsely listed PROVENZANO’s income as $20,000 per month when, in fact, his annual income was less than $50,000. The company subsequently provided verification for the false employment and income information on the loan application.
In November 2006, PROVENZANO refinanced the loan, obtaining a $936,000 mortgage from a federally insured bank. The new loan application, like the prior application, falsely listed PROVENZANO as employed by the same company as in the original loan application, and falsely listed his monthly income as $28,000, equal to $336,000 annually. The company again provided verification for the false information on the loan application.
The loan is now in default, and the Palmer Road property is now in foreclosure.
In May and June 2010, PROVENZANO and the same co-conspirator learned that the FBI and IRS were investigating the real estate and mortgage transactions involving the Palmer Road property. Among other things, the federal agents were examining a discrepancy in the closing documents, which showed that PROVENZANO had been obligated to make a down payment of approximately $249,000, but had never paid it. PROVENZANO and his co-conspirator met and created a false promissory note in the amount of approximately $249,000, and backdated the note to November 2005, to serve as an explanation of why the $249,000 down payment had never been paid at the closing. In June 2010, PROVENZANO agreed to be interviewed by the FBI and IRS. During the interview he falsely claimed that he had not needed to make the down payment in November 2005 because he had signed a promissory note to the seller for the same amount. Later that same month, PROVENZANO met with the FBI and IRS agents and provided them with a copy of the false, backdated promissory note.
As part of a separate conspiracy, in December 2009 and January 2010, PROVENZANO, the same co-conspirator and others engaged in a series of discussions about how to defraud a title insurance company. According to the discussions, the scheme involves a real property sale based on a deliberately defective title search, where one or more liens on the property are deliberately omitted from the title search report. After the property is sold and title insurance is issued, the conspirators arrange an event that triggers a new title search, such as a resale of the property. The “overlooked” liens turn up, providing the conspirators with a legal claim against, and a large payout from, the title insurer.
The conspirators attempted the scheme on a property held in the name of an entity controlled by PROVENZANO’s co-conspirator located at 66 Donahue Road Extension in Litchfield. PROVENZANO assisted in a title search of the property in January 2010, but then ceased to participate in the scheme. The property was later sold in March 2010 to his co-conspirator’s brother, and title insurance was issued based upon a defective title search. Three liens against the property, totaling approximately $990,000, had been deliberately omitted from the title search report.
PROVENZANO was ordered to pay $299,000 in restitution.
On January 9, 2014, PROVENZANO waived his right to indictment and pleaded guilty to one count ofconspiracy to commit bank fraud, one count of conspiracy to obstruct justice and one count of conspiracy to commit mail and wire fraud.
Four other individuals who are alleged to be involved in these schemes have been charged by indictment and are awaiting trial.
This investigation is being conducted by the Federal Bureau of Investigation and the Internal Revenue Service – Criminal Investigation Division. The case is being prosecuted by Assistant U.S. Attorney Henry Kopel.
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(203) 821-3722 [email protected]T.RAD Executive Agrees to Plead Guilty to Bid Rigging and Price Fixing on Automobile Parts Installed in U.S. CarsRead the Press Release
An executive of Japan-based T.RAD Co. Ltd. has agreed to plead guilty and to serve one year and one day in a U.S. prison for participating in a conspiracy to fix prices of radiators installed in cars sold in the United States and elsewhere, the Department of Justice announced today.
A one-count felony charge was filed today in the U.S. District Court for the Eastern District of Michigan in Detroit against Kosei Tamura, a general manager for T.RAD. According to the charge, Tamura, a Japanese national, conspired from as early as November 2002 until at least February 2010, by agreeing to allocate bids for, and prices of, radiators sold to Honda Motor Co. Ltd. and certain of its subsidiaries in the United States and elsewhere. In addition to the prison sentence, Tamura has agreed to pay a $20,000 criminal fine and to cooperate with the department’s ongoing investigation. The plea agreement is subject to court approval.
“Companies and their executives should do their part to ensure American consumers are guaranteed a fair marketplace within the automotive industry,” said Brent Snyder, Deputy Assistant Attorney General for the Antitrust Division’s criminal enforcement program. “The Antitrust Division will continue to hold accountable the companies and executives who ignore these laws in order to make this a reality.”
T.RAD is a manufacturer of radiators and was engaged in the sale of radiators in the United States and elsewhere. Radiators are devices located in the engine compartment of a vehicle that cool the engine.
In November 2013, T.RAD pleaded guilty and was sentenced to pay a $13.75 million criminal fine for its role in a conspiracy to fix the prices of radiators and automatic transmission fluid warmers.
Including today’s charges, 48 individuals have been charged in the department’s ongoing investigation into price fixing and bid rigging in the auto parts industry. Additionally, 32 companies have pleaded guilty or agreed to plead guilty and have agreed to pay a total of more than $2.4 billion in fines.
Tamura is charged with price fixing in violation of the Sherman Act, which carries a maximum sentence of 10 years in prison and a $1 million criminal fine for individuals. The maximum fine for an individual may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
The current prosecution arose from an ongoing federal antitrust investigation into price fixing, bid rigging, and other anticompetitive conduct in the automotive parts industry, which is being conducted by each of the Antitrust Division’s criminal sections and the FBI. This case was brought by the Washington Criminal I Section of the Antitrust Division with the assistance of the Detroit Field Office of the FBI. Anyone with information concerning the focus of this investigation should contact the Antitrust Division’s Citizen Complaint Center at 1-888-647-3258, visit www.justice.gov/atr/contact/newcase.html or call the Detroit Field Office of the FBI at 313-965-2323.
St. Anne Man to Serve More Than 14 Years in Federal Prison for Trafficking Heroin and Possession of A FirearmRead the Press Release
Urbana, Ill. – JB Brown, Jr., aka Cocoa, 37, of the 400 block of Circle Drive, St. Anne, Ill., was sentenced today to a term of 174 months (14 years, 6 months) in federal prison for trafficking heroin and possession of a firearm by a felon, as announced by Jim Lewis, U.S. Attorney for the Central District of Illinois. Brown was also ordered to remain on supervised release for a period of eight years following completion of his prison sentence. The court increased Brown’s advisory sentencing guideline range after finding that Brown committed perjury in July when he testified during his trial.
On July 29, 2014, a jury convicted Brown for possession of more than 100 grams of heroin, which he intended to distribute, and a loaded Glock .45 caliber semi-automatic pistol, in 2013, when Brown was a convicted felon. Brown has been in the custody of the U.S. Marshals Service since the jury conviction.
Assistant U.S. Attorney Eugene L. Miller prosecuted the case. The investigation was conducted by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Kankakee Area Project Safe Neighborhoods Task Force, and the Kankakee County Major Crimes Task Force.
Solon Man Sentenced to Nearly 11 Years in Prison for Defrauding Credit UnionRead the Press Release
The former chief executive officer of Taupa Lithuanian Credit Union sentenced to nearly 11 years in prison for leading a conspiracy that defrauded the credit union out of $15 million, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland office.
Alex Spirikaitis, 52, pleaded guilty earlier this year to one count of conspiracy to commit bank fraud. Spirikaitis personally embezzled about $4.2 million from Taupa between 2001 and 2013 and used the money to build a home in Solon, obtain a luxury suite at Cleveland Browns games, and buy multiple vehicles and firearms, according to court documents.
U.S. District Judge James Gwin sentenced Spirikaitis to 130 months in prison and ordered him to pay $15 million in restitution.
“This defendant is now paying the price for stealing millions of dollars from credit union members who entrusted him,” Dettelbach said. “He lived a life of luxury based on stolen money.”
“Alex Spirikaitis spent more than a decade engaged in corrupt actions before fleeing from the home he purchased with credit union funds,” Anthony said. “The FBI is proud that this fraudster was brought to justice.”
The National Credit Union Administration and the Ohio Department of Commerce took possession of Taupa last year and placed it into receivership due to its insolvency. Taupa had about 1,150 members and assets of approximately $24 million, according to court records.
Spirikaitis used the money he embezzled buy multiple firearms, which he stored at the credit union, and a suite for Cleveland Browns games. He used Taupa’s money to purchase nine vehicles for himself and his family between 2007 and 2012, according to court records.
He also used Taupa funds to write 26 checks between November 2011 and November 2012, totaling $1,655,000, to build a home on Liberty Road in Solon, according to court records.
He also engaged in a conspiracy with several other people, and their actions led to a loss of approximately $15 million to the credit union and NCUA. Spirikaitis allowed friends and associates to overdraw their accounts by more than $1 million. He also approved loans without seeking any relevant financial information, according to court documents.
This case is being prosecuted by Assistant United States Attorney Robert J. Patton and Special Assistant United States Attorney Derek Kleinmann. The case was investigated by the Federal Bureau of Investigation.
Rochester Man Sentenced in Tax SchemeRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051ROCHESTER, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that Norman Perry, 51, of Rochester, N.Y., who was convicted of making a false claim to the United States and aggravated identity theft, was sentenced to 90 months in prison and ordered to pay restitution to the Internal Revenue Service in the amount of $135,743 by U.S. District Judge Charles J. Siragusa.
Assistant U.S. Attorney Tiffany H. Lee, who handled the case, stated that the defendant posted advertisements in Rochester claiming that he could find lost or unclaimed funds. Individuals then provided Perry with their name, address and social security number and agreed to pay the defendant a fee, generally in the amount of $300, for each $1,000 check they received. In reality, Perry used the information to prepare and file false and fraudulent tax returns with the Internal Revenue Service, claiming that the individuals had qualified educational expenditures and were entitled to receive the American Opportunity Credit, a refundable tax credit for educational expenses. None of the individuals were students, none had incurred any educational expenditures and none provided such information to Perry.
In addition, the defendant filed a false tax return with the IRS in another individual’s name, and had the check sent to an address in Rochester. The check was subsequently cashed.
The sentencing is the culmination of an investigation on the part of Special Agents of the Internal Revenue Service – Criminal Investigations, under the direction of Shantelle P. Kitchen, Acting Special Agent in Charge, New York Field Office.
Rochester Man Sentenced for Obstructing Tax LawsRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051ROCHESTER, N.Y.—U.S. Attorney William J. Hochul, Jr. announced today that Anthony Cerame, 65, of Fairport, N.Y., who was convicted of obstructing the administration of the tax laws, was sentenced to five years probation and ordered to pay restitution to the Internal Revenue Service in the amount of $270,335. by U.S. District Judge David G. Larimer.
Assistant United States Attorney John J. Field, who handled the case, stated that Cerame engaged in a decades-long campaign to avoid paying approximately $270,000 federal income taxes, and sought to impede Special Agents of the Internal Revenue Service from performing their duties. Among other acts, the defendant used trusts and aliases to hold assets, concealed income, claimed improper deductions, instructed witnesses to withhold information from the government, and destroyed evidence. After Cerame learned of the government’s criminal investigation, he paid $200,000 of his unpaid tax obligation.
The sentencing is the culmination of an investigation by the Internal Revenue Service, Criminal Investigation Division, under the direction of Shantelle P. Kitchen, Acting Special Agent in Charge, New York Field Office.
Reno Man Sentenced to 8 Years in Prison for Traveling Across State Lines to Engage in Sexual Conduct with MinorRead the Press Release
FRESNO, Calif. — Ismael Martinez, 26, of Reno, Nevada, was sentenced today by United States District Judge Lawrence J. O'Neill to eight years and one month in prison for traveling from Reno to Fresno with the intent of engaging in illicit sexual conduct with a 14-year-old, United States Attorney Benjamin B. Wagner announced.
According to court documents, in August 2013 the parents of the minor female victim reported to the Fresno County Sheriff’s Office that they discovered text messages on a cellphone suggesting that their daughter was engaging in sexual relations with someone with a phone number with an out-of-state area code. Further investigation revealed this person to be Martinez, and that he had traveled from Reno to Fresno on multiple occasions in order to engage in sexual relations with the minor. On December 19, 2013, Martinez was indicted, and he pleaded guilty to the charge on September 15, 2014.
This case was the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and the Fresno County Sheriff’s Office. Assistant United States Attorney Brian W. Enos prosecuted the case.
This case was the product of an investigation by the U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) and the Fresno County Sheriff's Office and the Central Valley Internet Crimes Against Children Task Force. Assistant United States Attorney Brian W. Enos prosecuted the case.
" As this case underscores, parents need to talk to their kids about how to stay safe in cyberspace — cautioning them to always think before they click," said Michael J. Toms, the acting assistant special agent in charge who oversees HSI Fresno. "Young people, who would never approach a stranger in person, think nothing of interacting with someone they don't know online. The predators who are lurking on the Internet, exploit that trust. Homeland Security Investigations will continue to aggressively target online child predators, but parents, because of their proximity, are the first line of defense."This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood Marshals, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc. Click on the “resources” tab for information about Internet Safety.
Oxygen and Sleep Therapy Company Agrees to Resolve False Claims Act AllegationsRead the Press Release
BOSTON – Regional Home Care, Inc., (d/b/a North Atlantic Medical Services) (NAMS), a durable medical equipment supplier based in Leominster, Mass., has agreed to pay $852,378 to resolve allegations that it violated the False Claims Act by submitting claims to Medicare and Medicaid for respiratory care services provided by unlicensed personnel. NAMS provides equipment and services for the treatment of respiratory ailments, such as oxygen deficiency and sleep apnea.
“This respiratory care company flouted important licensure requirements, failed to provide patients the standard of care that they deserve, and fraudulently billed the federal government for improperly rendered services,” said U.S. Attorney Carmen M. Ortiz. “With the important assistance of whistleblowers, our health care fraud team seeks to ensure patient safety and protect the public fisc.”
“Respiratory care services should be performed by properly licensed personnel,” said Acting Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division. “We will not tolerate companies prioritizing their own profits and convenience at the expense of patient safeguards.”
The Massachusetts Department of Public Health requires respiratory therapists to meet professional licensure requirements in order to provide respiratory care. To apply for a Massachusetts license, one must first earn an Associate’s Degree in Respiratory Therapy, or its equivalent, and then, must pass a licensure examination administered by the National Board for Respiratory Care. This settlement resolves allegations that, from September 2010 through January 2013, NAMS sent unlicensed employees into patients’ homes to set up sleep apnea masks and oxygen therapy equipment. The government alleged that, even after the Massachusetts Department of Public Health informed the company that the practice was illegal, NAMS continued to use unlicensed personnel and billed Medicare and Medicaid for these services as if they had been performed by licensed personnel.
Medicaid is jointly funded by the states and federal government. The Commonwealth of Massachusetts, which paid in part for the Medicaid claims at issue, will receive $229,210 of the settlement amount.
The case was investigated by the Department of Health and Human Services, Office of the Inspector General, and the Federal Bureau of Investigation, and was handled by District of Massachusetts Assistant United States Attorneys Giselle Joffre and George Henderson and Department of Justice Trial Attorney Benjamin Young.
The claims resolved by this settlement are allegations only; there has been no determination of liability
Owner of Regional Healthcare, Llc Pleads Guilty to $2.5 Million Payroll Tax Fraud SchemeRead the Press Release
BATON ROUGE, LA - United States Attorney Walt Green announced today that CHARLES A. LANPHIER, age 68, of Lafayette, Louisiana, has pled guilty to a Bill of Information charging him with two counts of failing to truthfully account for and pay over taxes, in violation of Title 26, United States Code, Section 7202. LANPHIER faces significant incarceration, fines, and restitution orders.
According to the factual stipulation contained in the defendant’s written plea agreement with the United States, at all relevant times, LANPHIER owned and controlled Regional Healthcare, LLC (“Regional”), a health care company with operations throughout Louisiana and Florida. Regional operated through eleven (11) different corporate entities, and provided four different types of service, including patient care assistance, home health services, extended home health service (also known as pediatric care), and hospice services.
Regional was required to collect payroll taxes from its employees, make deposits of the payroll taxes to the Internal Revenue Service (“IRS”) on a periodic basis, and file quarterly federal income tax returns. As the defendant has admitted, however, throughout the tax years 2008 through 2011, as LANPHIER was causing Regional to withhold tax payments from its employees’ paychecks, LANPHIER knowingly and willfully failed to file the quarterly employment tax returns and knowingly and willfully failed to forward payroll taxes to the IRS. In total, during the tax years 2008 through 2011, LANPHIER failed to make payments on Regional’s behalf totaling more than $2.5 million. LANPHIER’s sentencing date has not been set.
This matter is being handled by the United States Attorney’s Office for the Middle District of Louisiana and the New Orleans Office of the Internal Revenue Service, Criminal Investigations. It is being prosecuted by Assistant United States Attorney Alan A. Stevens, who serves as a Deputy Chief in the Criminal Division.
Owner of Health Care Company Sentenced to Thirteen Years in PrisonRead the Press Release
BATON ROUGE, LA - United States Attorney Walt Green announced that U.S. District Judge Shelly D. Dick sentenced AHAOMA BONIFACE OHIA, age 60, of Missouri City, Texas, to serve one hundred fifty six (156) months in federal prison following his conviction earlier this year on seven counts of health care fraud. OHIA was also ordered to make restitution to the Medicare program in the amount of $1,239,283.58 and pay special assessments totaling $700. OHIA was also ordered to forfeit the proceeds of his criminal activity up to an additional $1,239,283.58. Finally, following his release from prison, OHIA will be required to serve a two-year term of supervised release.
The sentence follows a four-day jury trial last June at which OHIA was convicted of perpetrating a scheme to defraud Medicare through his company, All-Star Medical Supplies, which operated in Baton Rouge, Louisiana, and Houston, Texas. The evidence at trial established that from January 2007 through February 2009, OHIA caused All-Star to submit hundreds of false and fraudulent claims to Medicare. OHIA submitted hundreds of fraudulent claims, for instance, for “brace kits,” a package of nearly a dozen different braces, in matching left- and right-side pairs, regardless of whether any of the Medicare beneficiaries named in the claims needed or had prescriptions for the items. OHIA submitted hundreds of fraudulent claims for a highly-specialized, custom-fabricated device intended to be used by amputees, without ever actually providing a single such device to his clients, none of whom needed the device anyway. Finally, as the Court determined at today’s sentencing, OHIA submitted numerous claims for expensive power wheelchairs, through which claims the defendant falsely represented that he had replaced power wheelchairs for numerous beneficiaries whose original wheelchairs, OHIA falsely claimed, had been damaged or destroyed by a hurricane. In total, and as the Court determined today, the defendant, from January 2007 through February 2009, intended to obtain more than $2.2 million through the false claims described above.
U.S. Attorney Green stated: “Today’s sentence sends one of the clearest signals yet to those who would commit health care fraud in this district. Working with our law enforcement partners, we continue to work aggressively to combat health care fraud. When we are able to bring to justice and convict fraudsters who steal substantial amounts of money from the Medicare program over extended periods of time, such as OHIA did in this case, we will seek lengthy terms of imprisonment.”
“The sentence pronounced by the Court sends a clear message to health care providers that trying to make easy money by cheating Medicare isn’t worth it. There’s nothing easy about serving thirteen years in a federal penitentiary, as I’m sure this defendant will soon find out,” said Mike Fields, Special Agent-in-Charge of the Dallas Regional Office for the U.S. Department of Health and Human Services’ Office of Inspector General.
The case was investigated by the Office of Inspector General for the U.S. Department of Health and Human Services (DHH-OIG), the Federal Bureau of Investigation (FBI), and the Medicaid Fraud Control Unit of the Louisiana State Attorney General’s Office (MFCU), and was brought as part of the Medicare Fraud Strike Force, under the supervision of the United States Attorney’s Office and the Fraud Section of the Criminal Division of the U.S. Department of Justice. This case is being prosecuted by Assistant U.S. Attorney Alan A. Stevens, who serves as a Deputy Chief of the Criminal Division, and Assistant U.S. Attorney Cam Le.
Orlando Man Sentenced to More Than Five Years in Federal Prison for Credit Card FraudRead the Press Release
Orlando, Florida – U.S. District Judge Roy B. Dalton, Jr. today sentenced Tony Frith (36, Orlando) to 5 years and 10 months in federal prison for access device fraud. He was also ordered to pay more than $469,000 in restitution to the victims of his offense. Frith pleaded guilty on June 26, 2014.
According to court documents, officers from the Orlando Police Department conducted a traffic stop of Frith’s vehicle on September 15, 2013. Pursuant to the stop, officers conducted a search the vehicle and found a backpack containing a computer, an attached encoding device, and more than 200 counterfeit credit cards. Further investigation revealed that the credit cards were counterfeit and that they had been re-encoded with stolen credit card numbers. During a subsequent examination of Frith’s computer authorities found more than 3,000 credit card numbers, as well as text files with names, dates of birth, and Social Security numbers. The total amount of actual loss associated with the counterfeit credit cards and stolen credit card numbers found in Frith’s possession is over $470,000.
This case was investigated by the Orlando Police Department and the United States Secret Service. It was prosecuted by Assistant United States Attorney Roger B. Handberg.
North Texas U.S. Attorneys Office Helps Collect More Than $17 Million in Civil and Criminal Actions for U.S. Taxpayers in Fiscal Year 2014Read the Press Release
DALLAS — U.S. Attorney Sarah R. Saldaña announced today that the Northern District of Texas collected $13,130,113.54 in criminal and civil actions in Fiscal Year 2014. Of this amount, $9,419,602.42 was collected in criminal actions and $3,710,511.12 was collected in civil actions.
Additionally, the Northern District of Texas worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $3,991,303.62 in cases pursued jointly with these offices. Of this amount, $101,976.45 was collected in criminal actions and $3,889,327.17 was collected in civil actions.
The District has also been successful seizing proceeds of crime for asset forfeiture. For the first three quarters of FY 2014, working with partner agencies and divisions, the office collected more than $35 million in asset forfeiture actions.
“This District is dedicated not only to protecting the public, but to recovering funds for victims of federal crimes and the federal treasury,” said U.S. Attorney Saldaña. “These statistics show this office’s commitment to recover ill-gotten gains from those who violate federal criminal and civil laws so that funds can be restored to crime victims and a variety of law enforcement programs can be funded.”
Substantial collections in the District in FY 2014 include:
• $1 million in forfeited assets restored as restitution, and disbursed to hundreds of victims in U.S. v. Gregory Rand, et al., an oil and gas investment fraud case;
• $1.125 million civil settlement paid by Kwik Industries, Inc., for falsified loan applications a former employee made to the Small Business Administration (SBA), plus $176,000 recovered from the former employee was disbursed to the SBA and other lenders who were victims in U.S. v. Janice Stallons, after the Fifth Circuit affirmed the garnishment of her accounts;
• $525,000 in fines paid by defendants in U.S. v. Califco, LLC and Jonathan Shokrian, for shoddy asbestos removal from a shopping center in Irving, Texas;
• $340,000 garnished from multiple bank and retirement accounts of Cyprian Akamnonu, the first convicted defendant in the massive health care fraud case, U.S. v. Jacques Roy, et al.;
• $300,000 in restitution to 39 victims of convicted securities fraudster Jason Kosova; and
• $255,000 garnished from the business of Travis Atterberry on a 17-year-old bank fraud judgment. .
Last month, Attorney General Eric Holder announced that the Justice Department collected $24.7 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2014. The more than $24 billion in collections in FY 2014 represents nearly eight and a half times the appropriated $2.91 billion budget for the 94 U.S. Attorney’s offices and the main litigating divisions in that same period.
“Every day, the Justice Department’s federal prosecutors and trial attorneys work hard to protect our citizens, to safeguard precious taxpayer resources, and to provide a valuable return on investment to the American people,” said Attorney General Eric Holder. “Their diligent efforts are enabling us to achieve justice and recoup losses in virtually every sector of the U.S. economy. And this result shows the fruits of the Justice Department’s tireless work in enforcing federal laws; in protecting the American people from violent crime, national security threats, discrimination, exploitation, and abuse; and in holding financial institutions accountable for their roles in causing the 2008 financial crisis.”
The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.
The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education.
Newton County Former Youth Pastor Sentenced for Child PornographyRead the Press Release
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Office of Public AffairsBEAUMONT, Texas – A 23-year-old former youth pastor has been sentenced to federal prison for child pornography violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Trevion Lechay Ethridge, of Newton, Texas, pleaded guilty on June 3, 2014 to production of child pornography and was sentenced to 280 months in federal prison today by U.S. District Judge Ron Clark.According to information presented in court, from November 2012 to March 2013, while Ethridge was the youth pastor at a Newton County church, he persuaded a minor to video and photograph pornographic images and to send the pornography to Ethridge via smart phone. Ethridge was indicted by a federal grand jury on Oct. 3, 2013. Trial began in this case on May 12, 2014 and was recessed after two days. Trial resumed on June 3, 2014, at which time Ethridge changed his plea to guilty and under oath, admitted to sending the minor pornographic images and videos of himself and enticing the minor to send pornographic images and videos in return.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the 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.
This case was investigated by the ICE-HSI, the Newton Police Department and the Beaumont Police Department and prosecuted by Assistant U.S. Attorneys Randall L. Fluke and Lauren Gaston.
New London Man Admits Unlawfully Possessing Ammunition in Connection with New London ShootingRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that WEST ROBERTSON, also known as “Po,” 32, of New London, pleaded guilty today before U.S. District Judge Vanessa L. Bryant in Hartford to unlawfully possessing ammunition in connection with a recent shooting in New London.
According to court documents and statements made in court, on May 29, 2014, in the vicinity of Maple Avenue in New London, ROBERTSON became involved in an altercation with another individual and shot the victim several times. ROBERTSON then fled the scene.
The victim’s injuries were not life-threatening.
Eyewitness accounts identified ROBERTSON as the shooter, and a video surveillance camera captured his girlfriend’s car fleeing the scene of the shooting. Police also recovered ammunition shell casings in the Maple Avenue area.
ROBERTSON was arrested on June 6, 2014. The firearm he used in the shooting was later recovered.
ROBERTSON has multiple state felony convictions including those for robbery, kidnapping and possession of narcotics. It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.
ROBERTSON pleaded guilty to one count of being a felon in possession of ammunition. At sentencing, ROBERTSON faces up to 10 years of imprisonment. A sentencing date has not been scheduled.
ROBERTSON has been detained since his arrest.
This matter is being investigated by the New London Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives, with the assistance of the Connecticut State Police. The case is being prosecuted by Assistant U.S. Attorney Sarah Karwan.
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(203) 821-3722 [email protected]Minot Man Sentenced for Possession of Firearm & Ammunition by Convicted FelonRead the Press Release
BISMARCK – U.S. Attorney Timothy Q. Purdon announced that on December 1, 2014, Samuel Davis Everson III, 48, Minot, N.D., was sentenced by U.S. District Judge Daniel L. Hovland on a charge of possession of firearm and ammunition by a convicted felon. Everson pleaded guilty to the charge on
September 5, 2014.Judge Hovland sentenced Everson to serve 15 years in federal prison, to be followed by five years of supervised release. Everson was ordered to pay a $100 special assessment to the Crime Victim’s Fund.
On January 30, 2013, Everson was stopped for a traffic offense by an officer with the McKenzie County Sheriff’s Department. After smelling the odor of marijuana coming from the vehicle and after Everson was arrested for driving under suspension, a law enforcement search resulted in the discovery of a loaded 9mm caliber handgun.
On October 7, 2013, Everson was arrested at his residence in Minot, N.D., on a Montana federal warrant for conspiracy to distribute methamphetamine. During that arrest, a .357/.38 caliber revolver was located in a nightstand in his bedroom.
Everson was prohibited from possessing a firearm by virtue of his eleven prior felony convictions. Due to the fact that three or more of these convictions were “serious drug offense” convictions, the federal firearm offense carried a maximum penalty of life imprisonment, and a minimum mandatory sentence of 15 years in federal prison.
In February 2014, Everson was convicted of the drug offense in United States District Court in the District of Montana and sentenced to 14 years in federal prison. The 15-year North Dakota federal sentence was imposed to run concurrently to the undischarged term of imprisonment on the Montana conviction.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms & Explosives, the Drug Enforcement Administration, the McKenzie County Sheriff’s Office, the North Dakota Bureau of Criminal Investigation, the Minot Police Department and the Minot Drug Task Force.
Assistant U.S. Attorney David Hagler prosecuted the case.
Maricopa County Community College District Agrees to Pay $4 Million for Alleged False Claims Related to Award of AmeriCorps Education AwardsRead the Press Release
Maricopa County Community College District (MCCCD) has agreed to pay $4.08 million to resolve allegations under the False Claims Act that it submitted false claims to the Corporation for National and Community Service (CNCS) concerning AmeriCorps state and national grants, the Justice Department announced today. MCCCD is the entity responsible for operating community colleges in Maricopa County, Arizona, and is based in Phoenix.
“Those who receive federal funds must deal with the government openly and honestly,” said Acting Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division. “The Department of Justice will ensure that financial assistance provided by the Corporation for National and Community Service is received only by eligible individuals who satisfy CNCS’s mission of promoting service and education.”
CNCS is an independent federal agency that administers AmeriCorps, among other national service programs. MCCCD obtained AmeriCorps funding for Project Ayuda, a program that proposed to engage students in national service. In order to receive an AmeriCorps education award, a student had to meet certain service-hour requirements. MCCCD allegedly improperly certified that students had completed the required number of service hours so that they would earn an education award. This resulted in CNCS providing education awards to these students. MCCCD also allegedly improperly received grant funds from CNCS to administer the project.
“Our internal process uncovered MCCCD’s mismanagement, and we worked with the Justice Department to ensure that taxpayer dollars were recovered,” said CNCS’s General Counsel Valerie Green. “This is an example of how interagency collaboration works.”
“Taxpayers are justifiably outraged when a community fails to receive promised services because national service funds were misused,” said CNCS’s Inspector General Deborah J. Jeffrey. “We hope that this settlement will deter other grantees from similar misconduct.”
The allegations resolved by this settlement arose from a whistleblower lawsuit filed under the False Claims Act by Christine Hunt, an MCCCD employee. Under the False Claims Act, private citizens can sue on behalf of the government and share in any recovery. Hunt’s share of the settlement is $775,827.
This case was handled by the Commercial Litigation Branch of the Civil Division and CNCS’s Office of Inspector General and Office of General Counsel.
The lawsuit is captioned United States ex rel. Hunt v. Maricopa County Community College District; Paula and Richard Vaughn, No. 11-cv-2241 (D. Ariz.). The claims resolved by the settlement are allegations only, and there has been no determination of liability.
Managing Director Sentenced for Investment Fraud and EmbezzlementRead the Press Release
SAN DIEGO – United States Attorney Laura E. Duffy announced that Walter Andrew Mills, 45, of San Diego County was sentenced today to 30 months in prison for investment fraud and embezzlement.
U.S. District Court Judge Roger T. Benitez also ordered Mills to pay $844,800 in restitution.
Mills pleaded guilty to wire fraud on June 6, 2014. According to court documents and his admissions, Mills fraudulently convinced a victim to invest $419,800 in Mills’ company, Cabrillo Investment Group, LLC, by concealing the fact that the victim’s previous investments in HessGen, Inc. had been misappropriated. Upon receiving the investment, Mills diverted a significant portion of the money to his own personal use.
As part of a larger scheme, between November 5, 2010, and March 26, 2012, Mills convinced additional victims to invest $425,000 in HessGen and another company, Smart Gaming Software, knowing that a significant portion of the money would not be used for the purposes represented. Mills similarly diverted a significant portion of those funds to his own personal use.
“The defendant cheated investors out of hundreds of thousands of dollars and now he is being held to account,” said U.S. Attorney Laura Duffy. “The victims placed their faith and financial futures in the hands of a man who thought only of himself.”
FBI Special Agent in Charge Eric S. Birnbaum commented, “Mr. Mills violated the trust of the people who had faith in him and the ones he was supposed to serve. The FBI is committed to holding those accountable who abuse their position of trust for the sole purpose of unlawfully enriching themselves.”
DEFENDANTS Case Number: 14-cr-01576-BEN Walter Andrew Mills Age: 45 San Diego, California CHARGESWire Fraud – Title 18, U.S.C., Section 1343
INVESTIGATING AGENCY
Maximum penalty: 20 years’ imprisonment and $250,000 fineFederal Bureau of Investigation
Man Sentenced to Prison for Passport Fraud and Social Security FraudRead the Press Release
A man who illegally obtained a passport and social security benefits was sentenced on November 25, 2014, to 12 months’ imprisonment.
Raymundo Sierra-Mendez, age 71, from Mexico, received the prison term after a September 18, 2014, guilty plea to one count of social security fraud and one count of passport fraud.
In a plea agreement, Sierra-Mendez admitted he used a fraudulent name, social security card and birth certificate to obtain a United States passport in 2008. He also applied for and obtained social security benefits in 2008, with the same documents.
Sierra-Mendez was sentenced in Sioux City by United States District Court Judge Mark W. Bennett. Sierra-Mendez was sentenced to 12 months’ imprisonment. He must also serve a 1-year term of supervised release. There is no parole in the federal system.
The case was prosecuted by Assistant United States Attorney Kevin C. Fletcher and investigated by HSI and the Enforcement and Removal Office of the Immigration and Customs Enforcement Bureau.
Court file information is available at https//ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 14-CR-4053.Man Sentenced to Prison for Illegal Re-entryRead the Press Release
A man who re-entered the United States following a felony conviction was sentenced on November 18, 2014, to 7 months’ imprisonment.
Jose Santillanes-Barraza, age 43, from Mexico, received the prison term after a June 17, 2014, guilty plea to one count of illegal re-entry as a felon.
At the guilty plea, Santillanes-Barraza admitted he had re-entered the United States without permission after being removed from the country on December 1, 2010. On August 26, 2010, Santillanes-Barraza was convicted of tampering with records in the Iowa District Court, Buena Vista County. Santillanes-Barraza came to the attention of Homeland Security Investigations (HSI) after he was arrested on April 30, 2014, in Hancock County, Iowa for OWI.
Santillanes-Barraza was sentenced in Sioux City by United States District Court Judge Mark W. Bennett. Santillanes-Barraza was sentenced to 7 months’ imprisonment. He must also serve a 3-year term of supervised release. There is no parole in the federal system.
The case was prosecuted by Assistant United States Attorney Kevin C. Fletcher and investigated by HSI and the Enforcement and Removal Office of the Immigration and Customs Enforcement Bureau.
Court file information is available at https//ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 14-CR-3027.Man Sentenced to Prison for Illegal Re-entryRead the Press Release
A man who re-entered the United States following a felony conviction was sentenced on November 18, 2014, to 54 months’ imprisonment.
Esteban Fuego-Sanchez, age 42, from Guatemala, received the prison term after an August 15, 2014, guilty plea to one count of illegal re-entry as an aggravated felon.
At the guilty plea, Fuego-Sanchez admitted he had re-entered the United States without permission after being removed from the country on October 2, 2004. On September 28, 1995, Fuego-Sanchez was convicted of theft of property, a felony, in Jefferson County, Arkansas. Fuego-Sanchez came to the attention of Homeland Security Investigations (HSI) after he was arrested on June 18, 2014, in Wright County, Iowa for driving without a license.
Fuego-Sanchez was sentenced in Sioux City by United States District Court Judge Mark W. Bennett. Fuego-Sanchez was sentenced to 54 months’ imprisonment. He must also serve a 3-year term of supervised release. A special assessment of $100 was imposed. There is no parole in the federal system.
The case was prosecuted by Assistant United States Attorney Kevin C. Fletcher and investigated by HSI and the Enforcement and Removal Office of the Immigration and Customs Enforcement Bureau.
Court file information is available at https//ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 14-CR-3038.Man Sentenced to Prison for Illegal Re-entryRead the Press Release
A man who re-entered the United States illegally was sentenced on November 20, 2014, to 4 months in prison.
David Ordonez-Lopez, age 20, from Guatemala, received the prison term after a September 22, 2014, guilty plea to one count of illegal re-entry.
At the guilty plea, Ordonez-Lopez admitted he had re-entered the United States without permission after being removed from the country on October 31, 2012. Ordonez-Lopez came to the attention of Homeland Security Investigations’ (HSI) on July 15, 2014, after he was arrested for OWI in Wright County, Iowa.
Ordonez-Lopez was sentenced in Sioux City by United States District Court Judge Mark W. Bennett. Ordonez-Lopez was sentenced to 4 months’ imprisonment. He must also serve a 1-year term of supervised release. There is no parole in the federal system.
The case was prosecuted by Assistant United States Attorney Kevin C. Fletcher and investigated by HSI and the Enforcement and Removal Office of the Immigration and Customs Enforcement Bureau.
Court file information is available at https//ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 14-CR-3044.Johnstown Man Pleads Guilty to Distributing Crack CocaineRead the Press Release
JOHNSTOWN, Pa. - A resident of Johnstown, Pa., pleaded guilty in federal court to a charge of distribution of cocaine base, in the form commonly known as "crack," United States Attorney David J. Hickton announced today.
John D. Malden, 40, pleaded guilty to one count before United States District Judge Kim R. Gibson.
In connection with the guilty plea, the court was advised that on April 25, 2013, Malden distributed less than 28 grams of crack cocaine.
Judge Gibson scheduled sentencing for April 9, 2015, at 10 a.m. The law provides for a total sentence of 20 years in prison, a fine of $1,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney John J. Valkovci, Jr., is prosecuting this case on behalf of the government.
The Laurel Highlands Resident Agency of the Federal Bureau of Investigation and the Cambria County Drug Task Force conducted the investigation that led to the prosecution of Malden.
Jayne Concialdi Imprisoned for White River Junction EmbezzlementRead the Press Release
The Office of the United States Attorney for the District of Vermont announced that Jayne Concialdi, 51, a former resident of Quechee who now lives in Connecticut, was sentenced today in United States District Court in Burlington to 18 months of imprisonment following her guilty plea to a charge of wire fraud. U.S. District Judge William K. Sessions III also ordered that Concialdi serve three years of supervised release following her prison term and pay restitution of more than $129,000. The court directed Concialdi to surrender to the Bureau of Prisons on January 6 to begin serving her sentence.
Last July 24, Concialdi pled guilty to an information charging her with wire fraud. According to the information, Concialdi was employed as an administrative assistant to the treasurer of New England Research, Inc., a company in White River which specializes in the measurement and interpretation of rock properties for the energy industry. Concialdi had bookkeeping responsibilities. Between 2011 and early 2014, Concialdi misappropriated about $129,000 from her employer, primarily by using company funds to pay her personal credit card obligations. The defendant also misused company credit cards to make purchases for her own benefit. NERI uncovered the embezzlement this past February.
This case was investigated by the Hartford Police Department and the Federal Bureau of Investigation.
Concialdi is represented by Jordana Levine. The prosecutor is Assistant U.S. Attorney Gregory Waples.
Hinesburg 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 Gregory Brusso, 57, of Hinesburg, Vermont, was sentenced on December 1, 2014, in United States District Court in Burlington, Vermont, to serve 18-months imprisonment and a five-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 William K. Sessions III also ordered Brusso to pay a $100 special assessment.
According to court records and proceedings, Brusso, a former member of the Vermont Air National Guard, ordered a DVD containing child pornography from what he thought was a company that had such materials for sale. This company was actually an undercover operation being run by the U.S. Postal Inspection Service. After Brusso accepted delivery of the DVD at his residence, Postal Inspectors executed a search warrant and confiscated his computer. A forensic examination of the computer revealed the presence of images of child pornography on it.
In 2003, Brusso was identified through his credit card history as having made purchases at three websites known to sell child pornography. In 2008, law enforcement investigated Brusso for allegedly uploading an image of child pornography to an Internet group run by Yahoo!.
United States Attorney Coffin commended the efforts of the United States Postal Inspection Service in the prosecution of Brusso. The prosecution of Brusso was handled by Assistant U.S. Attorney Barbara A. Masterson. Brusso was represented by Richard C. Bothfeld.
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.
Government Settles False Claims Act Allegations Against Oxygen and Sleep Therapy CompanyRead the Press Release
North Atlantic Medical Services Inc. (NAMS), doing business as Regional Home Care Inc., has agreed to pay $852,378 to resolve allegations that it violated the False Claims Act by submitting claims to Medicare and Medicaid for respiratory therapy services provided by unlicensed personnel, the Department of Justice announced today. NAMS is a medical device company based in Massachusetts that provides equipment and services for the treatment of respiratory ailments, such as oxygen deficiency and sleep apnea.
“Respiratory care services should be performed by properly licensed personnel,” said Acting Assistant Attorney General Joyce R. Branda for the Civil Division. “We will not tolerate companies prioritizing their own profits and convenience at the expense of patient safeguards.”
Medicare and Medicaid require suppliers of respiratory therapy equipment and services to comply with state licensing standards. In Massachusetts, the Department of Public Health requires respiratory therapists to apply for and obtain a license. Applicants can do so by passing the National Board for Respiratory Care’s “Certification Examination for Entry-Level Respiratory Therapy Practitioners” or obtaining a reciprocal license from a different jurisdiction. This settlement resolves allegations that, from September 2010 to January 2013, NAMS used unlicensed employees to set up sleep apnea masks and oxygen therapy equipment for patients in Massachusetts. The government alleged that, even after the Massachusetts Department of Public Health informed the company that the practice was illegal, NAMS continued to use unlicensed personnel and bill Medicare and Medicaid for these services.
“This respiratory care company flouted important licensure requirements, failed to provide patients the standard of care that they deserve and fraudulently billed the federal government for improperly rendered services,” said U.S. Attorney Carmen M. Ortiz for the District of Massachusetts. “With the important assistance of whistleblowers, our health care fraud team seeks to ensure patient safety and protect the public fisc.”
“To safeguard patient health and ensure that taxpayer money is spent well, Medicare and Medicaid require providers of respiratory care services to follow state licensure rules,” said Special Agent in Charge Phillip M. Coyne for the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG). “Companies seeking to boost profits by using unlicensed personnel will be held accountable for their actions.”
Medicaid is jointly funded by the states and federal government. The Commonwealth of Massachusetts, which paid in part for the Medicaid claims at issue, will receive $229,210 of the settlement amount.
The government’s investigation was initiated by a qui tam, or whistleblower, lawsuit filed under the False Claims Act by former NAMS employees Konstantinos Gakis and Demetri Papageorgiou. The False Claims Act allows private citizens to file suit for false claims on behalf of the government and to share in the government’s recovery. Gakis and Papageorgiou will receive $153,428.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $23.2 billion through False Claims Act cases, with more than $14.9 billion of that amount recovered in cases involving fraud against federal health care programs.
This settlement was the result of a coordinated effort by the Civil Division, the U.S. Attorney’s Office for the District of Massachusetts, FBI, HHS-OIG, and the Commonwealth of Massachusetts.
The case is captioned United States ex rel. John Does v. Regional Home Care, Inc. d/b/a North Atlantic Medical also d/b/a North Atlantic Medical Tolman Clinical Laboratory and as North Atlantic Medical Services, Docket No. 12-CA-11979 (D. Mass.). The claims resolved by this settlement are allegations only, and there has been no determination of liability.
Fort Yates Man Sentenced of Sexual AssaultRead the Press Release
BISMARCK – U.S. Attorney Timothy Q. Purdon announced that on December 1, 2014, Austin Agard, Age 28, of Fort Yates ND, was sentenced by U.S. District Judge Daniel L. Hovland on a charge of Sexual Assault when he, Agard, performed sexual acts on a person incapable of declining participation in the act.
Judge Hovland sentenced Agard to serve 70 months imprisonment, to be followed by five years supervised probation.
The case was investigated by the Bureau of Indian Affairs.
Assistant U.S. Attorney Gary Delorme prosecuted the case.
Former Ohio Deputy Treasurer and Friend Sentenced for Roles in Bribery and Money Laundering SchemeRead the Press Release
Ohio’s former deputy treasurer and a Chicago businessman were sentenced to federal prison today for their roles in a bribery and money laundering scheme involving the Ohio Treasurer’s Office.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, First Assistant U.S. Attorney Mark T. D’Alessandro of the Southern District of Ohio, Acting Special Agent in Charge John A. Barrios of the FBI’s Cincinnati Division and Attorney General Mike DeWine of Ohio made the announcement.
Amer Ahmad, 40, and Joseph Chiavaroli, 34, both of Chicago, were sentenced today by U.S. District Judge Michael H. Watson of the Southern District of Ohio to serve 15 years in prison and 18 months in prison, respectively. Ahmad was ordered to forfeit $3.2 million, and Chiavroli was ordered to forfeit $400,000. Last year, Ahmad pleaded guilty to federal program bribery and conspiracy to commit honest services wire fraud, federal program bribery and money laundering, and Chiavaroli pleaded guilty to money laundering. Following his guilty plea, former Deputy Treasurer Ahmad fled to Pakistan and was sentenced today in absentia. He is currently in Pakistani custody pending an extradition request from the United States government.
According to the defendants’ admissions in connection with their guilty pleas, from January 2009 through January 2011, Ahmad used his position as deputy treasurer to direct official state of Ohio business to securities broker Douglas E. Hampton in return for bribes. Ahmad and Chiavaroli concealed the payments received from Hampton by passing them through the accounts of their landscaping business. Hampton also funneled more than $123,000 to Mohammed Noure Alo, an attorney and lobbyist who was Ahmad’s close personal friend and business associate. Over the course of the scheme, Hampton paid in excess of $500,000 in bribes and received, in exchange, approximately $3.2 million in commissions for 360 securities trades on behalf of the Ohio Treasurer’s Office.
Hampton and Alo were sentenced on Nov. 12, 2014, and Nov. 13, 2014, to 45 months in prison and 48 months in prison, respectively, for their roles in the scheme.
The case was investigated by the FBI’s Central Ohio Public Corruption Task Force, which includes special agents from the FBI and the Ohio Bureau of Criminal Investigation. The case is being prosecuted by Trial Attorneys Eric L. Gibson and Menaka Kalaskar of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Douglas W. Squires of the Southern District of Ohio.
Former Mitsuba Executive Agrees to Plead Guilty to Bid Rigging and Price Fixing on Automobile Parts Installed in U.S. CarsRead the Press Release
A former executive of Japan-based Mitsuba Corporation has agreed to plead guilty and serve 13 months in a U.S. prison for conspiring to fix the prices of products installed in cars sold in the United States and elsewhere, the Department of Justice announced today.
A one-count felony charge was filed today in the U.S. District Court for the Eastern District of Michigan in Detroit against Kazumi Umahashi, a Japanese national and former General Manager of Mitsuba. Umahashi conspired from in or about June 2005 to in or about December 2009 by agreeing upon bids and prices for, and allocating the supply of, windshield wiper systems and starter motors sold to Honda Motor Co. Ltd. and its subsidiaries and affiliates in the United States and elsewhere, according to the charge. Umahashi also has agreed to pay a $20,000 criminal fine and cooperate with the department’s ongoing investigation. The plea agreement is subject to court approval.
“The Antitrust Division has uncovered dozens of conspiracies to fix prices in the automotive industry,” said Brent Snyder, Deputy Assistant Attorney General for the Antitrust Division’s criminal enforcement program. “The impact of these schemes has affected nearly every American. We will continue our efforts to hold culpable companies and individuals accountable for their illegal actions.”
Mitsuba manufactures and sells a variety of automotive parts, including starter motors, which are small electric motors used in internal combustion engines, and windshield wiper systems. On Nov. 6, 2013, Mitsuba pleaded guilty for its involvement in the conspiracy and agreed to pay $135 million in criminal fines.
Umahashi is charged with price fixing and bid rigging in violation of the Sherman Act, which carries a maximum sentence for individuals of 10 years and a fine of $1 million. The maximum fine for an individual may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
Including today’s charges, 48 individuals have been charged in the department’s ongoing investigation into price fixing and bid rigging in the auto parts industry. Additionally, 32 companies have pleaded guilty or agreed to plead guilty and have agreed to pay a total of more than $2.4 billion in fines.
This prosecution arose from an ongoing federal antitrust investigation into price fixing, bid rigging, and other anticompetitive conduct in the automotive parts industry, which is being conducted by the Antitrust Division’s criminal enforcement sections and the FBI. Today’s charge was brought by the Antitrust Division’s Washington Criminal I Section with the assistance of the FBI’s Detroit Field Office and the FBI headquarters’ International Corruption Unit. Anyone with information on price fixing, bid rigging and other anticompetitive conduct related to other products in the automotive parts industry should contact the Antitrust Division’s Citizen Complaint Center at 888-647-3258, visit www.justice.gov/atr/contact/newcase.html, or call the Detroit Field Office of the FBI at 313-965-2323.
Former Builder's Release from Federal Prison Revoked Following More Complaints of FraudRead the Press Release
TOPEKA, KAN. – A federal judge has found former Kansas City builder F. Jeffrey Miller violated the terms of his release from federal prison after hearing evidence Miller was involved in a new real estate scam, U.S. Attorney Barry Grissom said Monday.
In a 16-page order dated Nov. 26, U.S. District Judge Julie A. Robinson cited evidence that Miller lied to his probation officer about his involvement with his son, Brandon, in a company called Tri-States Holding, LLC (TSH). She cited “substantial evidence about the fraudulent practices and transactions” by the company.
Miller, 53, will remain in custody awaiting sentencing. Miller was convicted by a jury of conspiracy to commit bank fraud, money laundering and criminal contempt. In August 2012, he was sentenced to 72 months in federal prison. He began supervised release Jan. 10, 2014.
During sentencing hearings, prosecutors submitted evidence that Miller began planning the new business while he was in prison. He formed the new company with his 23-year-old son, Brandon. Although Brandon Miller was represented as the owner, his father controlled the company. The Millers claimed to be in business to buy, refurbish and sell houses. In fact, Judge Robinson said in her order, the business was engaged in a “contract for deed scam.”
The company purchased more than 40 houses at Jackson County, Mo., tax sales and then advertised the houses for sale to low-income people in the urban core of Kansas City. The company advertised home ownership for just $500 down, sweat equity of no more than $2,000 in the form of cosmetic repairs including painting and clean up, and then monthly payments of $399. The buyers signed contracts for purchase prices in the $35,000 range.
Prosecutors presented evidence the company failed to complete promised repairs, performing shoddy repairs or virtually no repairs at all and then harassed and threatened buyers who ceased to make payments.
Judge Robinson ruled Miller violated four conditions of his supervised release by:
- Controlling the new company even though he was prohibited from working in any capacity involving authority in financial matters.
- Telling his probation officer that that he was a mere laborer at the new company when in fact he controlled the company.
- Making false monthly reports to the probation office that he was not committing any federal crimes.
- Making threats of bodily harm to a woman who purchased a house from the new company.
Miller is scheduled for sentencing Dec. 15 in U.S. District Court in Topeka.
Former Branch Manager of Bank Pleads Guilty in Manhattan Federal Court to Cashing over $400,000 in Fraudulently Obtained Tax Refund ChecksRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Shantelle P. Kitchen, Acting Special Agent in Charge of the New York Office of the Internal Revenue Service, Criminal Investigation Division (“IRS-CID”), and James T. Hayes, Jr., the Special Agent in Charge of the New York Field Office of the U.S. Immigration and Customs Enforcement’s (“ICE”) Homeland Security Investigations (“HSI”), announced that EDWIN MEJIA pled guilty today to participating in a scheme to cash more than $400,000 in fraudulently obtained federal tax refund checks issued in other people’s names. MEJIA was arrested in March 2014 and pled guilty today before U.S. District Judge Paul A. Engelmayer.
According to the allegations in the Complaint and Information filed in Manhattan federal court, and statements made during today’s plea proceeding:
Until approximately March 2014, MEJIA worked at branches of a bank (“Bank-1”) in Yonkers and Manhattan. MEJIA initially was a banker and later became the branch manager of multiple branches of Bank-1. From approximately 2010 through 2013, MEJIA participated in a scheme to fraudulently obtain and cash tax refund checks issued by the United States Treasury. The fraudulent refund checks were generated by the filing of false and fraudulent tax returns in the names of other people (the “purported filers”), and the checks were made payable to the purported filers. As part of this scheme, MEJIA helped facilitate the cashing of the fraudulent refund checks.
In particular, MEJIA obtained personal identification information for the purported filers, including their Social Security numbers and dates of birth. MEJIA then cashed the fraudulent checks himself or by paying a co-conspirator to do so. When cashing a fraudulent check himself, MEJIA presented the refund check, along with the corresponding Social Security number and date of birth of the purported filer, to a complicit bank employee. Other times, MEJIA paid a co-conspirator to open bank accounts in the names of the purported filers and cash the checks. As part of the scheme, MEJIA cashed, or caused others to cash, more than $400,000 in fraudulent Treasury checks.
* * *
MEJIA, 31, of Yonkers, New York, pled guilty to one count of theft of public funds, which carries a maximum sentence of 10 years in prison, and one count of aggravated identity theft, which carries a mandatory consecutive sentence of two years in prison. The statutory minimum and maximum sentences are prescribed by Congress and are provided here for informational purposes, as any sentencing of the defendant will be determined by the judge. As part of his plea, MEJIA also agreed to pay $442,642.58 in forfeiture. He is scheduled to be sentenced by Judge Engelmayer on March 12, 2015, at 2:15 p.m.
Mr. Bharara praised the outstanding efforts of IRS-CID and HSI in the investigation.
This case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorney Jonathan Cohen is in charge of the prosecution.
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Former Branch Manager of Bank Pleads Guilty in Manhattan Federal Court to Cashing over $400,000 in Fraudulently Obtained Tax Refund ChecksRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Shantelle P. Kitchen, Acting Special Agent in Charge of the New York Office of the Internal Revenue Service, Criminal Investigation Division (“IRS-CID”), and James T. Hayes, Jr., the Special Agent in Charge of the New York Field Office of the U.S. Immigration and Customs Enforcement’s (“ICE”) Homeland Security Investigations (“HSI”), announced that EDWIN MEJIA pled guilty today to participating in a scheme to cash more than $400,000 in fraudulently obtained federal tax refund checks issued in other people’s names. MEJIA was arrested in March 2014 and pled guilty today before U.S. District Judge Paul A. Engelmayer.
According to the allegations in the Complaint and Information filed in Manhattan federal court, and statements made during today’s plea proceeding:
Until approximately March 2014, MEJIA worked at branches of a bank (“Bank-1”) in Yonkers and Manhattan. MEJIA initially was a banker and later became the branch manager of multiple branches of Bank-1. From approximately 2010 through 2013, MEJIA participated in a scheme to fraudulently obtain and cash tax refund checks issued by the United States Treasury. The fraudulent refund checks were generated by the filing of false and fraudulent tax returns in the names of other people (the “purported filers”), and the checks were made payable to the purported filers. As part of this scheme, MEJIA helped facilitate the cashing of the fraudulent refund checks.
In particular, MEJIA obtained personal identification information for the purported filers, including their Social Security numbers and dates of birth. MEJIA then cashed the fraudulent checks himself or by paying a co-conspirator to do so. When cashing a fraudulent check himself, MEJIA presented the refund check, along with the corresponding Social Security number and date of birth of the purported filer, to a complicit bank employee. Other times, MEJIA paid a co-conspirator to open bank accounts in the names of the purported filers and cash the checks. As part of the scheme, MEJIA cashed, or caused others to cash, more than $400,000 in fraudulent Treasury checks.
MEJIA, 31, of Yonkers, New York, pled guilty to one count of theft of public funds, which carries a maximum sentence of 10 years in prison, and one count of aggravated identity theft, which carries a mandatory consecutive sentence of two years in prison. The statutory minimum and maximum sentences are prescribed by Congress and are provided here for informational purposes, as any sentencing of the defendant will be determined by the judge. As part of his plea, MEJIA also agreed to pay $442,642.58 in forfeiture. He is scheduled to be sentenced by Judge Engelmayer on March 12, 2015, at 2:15 p.m.
Mr. Bharara praised the outstanding efforts of IRS-CID and HSI in the investigation.
This case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorney Jonathan Cohen is in charge of the prosecution.
Final Four Members of Major Heroin Distribution Ring Plead GuiltyRead the Press Release
HARRISONBURG, VIRGINIA – The final four members of a heroin distribution ring that brought hundreds of grams of heroin per week into the Winchester area, pled guilty late last week in the United States District Court for the Western District of Virginia in Harrisonburg to federal drug conspiracy charges. In all, the conspiracy brought multiple kilograms of heroin into the area during the life of the conspiracy.
In all, thirteen individuals have been convicted of drug distribution conspiracy and an additional defendant from New York has been arrested and charged via federal criminal complaint.
“Mr. Jones and his co-conspirators supervised a significant illegal business that imported heroin from New York and distributed it across Virginia,” United States Attorney Timothy J. Heaphy said today. “We will continue to do all we can to identify patterns of heroin trafficking and dismantle the criminal conspiracies that bring this poison into our communities. We must also do all we can to enhance prevention efforts and provide treatment services to those struggling with addiction. A comprehensive approach is essential if we are going to stem the tide of heroin abuse in our communities.”
“This is another excellent example of Inter-Agency cooperation in eradicating a violent and dangerous drug gang. I commend the courage and dedication of all the agents and officers, whether they be ATF, State or Local, who worked so diligently on this investigation to bring it to its successful conclusion” said Charles E. Smith, Special Agent in Charge of the Washington Field Division. “It is part and parcel of ATF’s “Frontline Initiative” which concerns the investigating and targeting of the most violent and destructive elements of society today.”
As of last week, thirteen defendants have pled guilty to drug distribution conspiracy charges. Those defendants who have pled guilty are as follows:
- Ronny Maurice Jones, 37, of Woodstock, Virginia
- Kareem Allen Shaw, 39, of Oxon Hill, Maryland
- Columbus Butler, 59, of Edinburg, Virginia
- Charles William Smith Jr., 47, of Edinburg, Virginia
- Joshua Adam Pettyjohn, 29, of Woodstock, Virginia
- Logan Montgomery Rose, 26, of Woodstock, Virginia
- Arthur Marquinton Ronnelle Kinnard, 29, of Winchester, Virginia
- Ashton Grace Kern, 23, of Strasburg, Virginia
- Francis D. Alvarez, 38, of Woodstock, Virginia
- Arthur Sean Bailey, 36, of Sterling, Virginia
- Kimberle Ann Hodsden, 31, of Stafford, Virginia
- Keith Thomas Marshall, 39, of Reston, Virginia
- Ryan Kenneth McQuinn, 28, of Stafford, Virginia
In addition, Matthew Santiago, of New York, has been arrested and charged via a federal indictment with heroin distribution conspiracy charges.
According to evidence presented at various hearings by Assistant United States Attorney Donald Wolthuis, Jones and Shaw were major heroin cocaine distributors in the western and eastern districts of Virginia. Jones supplied heroin to sub-distributors for locations in the Western District of Virginia (Rockingham County, Frederick County, Shenandoah County, Page County, Warren County) while Shaw controlled the flow of heroin to locations in the Eastern District of Virginia (Prince William County, Stafford County).
The United States has put forth evidence that Jones was bringing approximately 80-150 grams of heroin into the Western District of Virginia each week. Shaw, operating in the Eastern District of Virginia, was bringing in hundreds grams of heroin each week. In addition to charges again Jones, Shaw and their local sub-distributors, the United States Attorney’s Office for the Western District of Virginia has also arrested and charged, via a federal indictment, Matthew Santiago, the man charged as the source of heroin for both Jones and Shaw.
In addition, several firearms were recovered as part of the investigation, including one stolen pistol from Shenandoah County.
The investigation of this case was conducted by the Martinsburg Field Office of the Bureau of Alcohol, Tobacco, Firearms and Explosives, Washington Field Division, the Virginia State Police’s Northwest Virginia Regional Drug Task Force and RUSH Drug Task Force and the Stafford County Special Investigation Unit. Assistant United States Attorney Donald Wolthuis is prosecuting the case for the United States.