Latest Records
Newest first across public DOJ and U.S. Attorney press releases.
Tuesday 7 October 2014
Local Dentist, Dr. Glenn V. Schmidt, Sentenced for Failing to Pay TaxesRead the Press Release
The United States Attorney’s Office announced that DR. GLENN V. SCHMIDT, age 65, a resident of New Orleans, Louisiana, was sentenced today after he previously entered a guilty plea to a bill of information on July 8, 2014. According to court documents, SCHMIDT admitted that he had failed to pay the appropriate amount of taxes for the second quarter of the 2009 tax year in the amount of $24,252.52. SCHMIDT entered a guilty plea as part of the Internal Revenue Service’s Expedited Plea Program. Under this program, defendants are allowed to plea to the major count of the charging document but must make full restitution to the government.
U.S. District Judge Jay C. Zainey sentenced SCHMIDT to 5 years of probation, restitution of $306,724.78 to the government, and 300 hours of community service for failing to pay withholding and FICA taxes to the Internal Revenue Service. The community service will consist of free dental care to the homeless, veterans and young runaways through various community organizations to be coordinated with U.S. Probation.
The U.S. Attorney’s Office praised the work of the Internal Revenue Service-Criminal Investigation Division in investigating this matter. Assistant United States Attorney Edward J. Rivera is in charge of the prosecution.
Leader of Howard County Bloods Gang Pleads Guilty to Racketeering Conspiracy and Gun ChargesRead the Press Release
19 Defendants Have Pleaded Guilty to Federal Racketeering and Drug Conspiracies
Baltimore, Maryland – Anthony Preston, a/k/a “40,” or “Tone,” age 27, of Laurel, in Howard County Maryland, pleaded guilty today to conspiring to participate in a racketeering conspiracy, and using and carrying a firearm during and in relation to a crime of violence, in connection with his membership in the Bloods gang operating primarily out of Howard County, Maryland.The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge William P. McMullan of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; Howard County Police Chief Gary L. Gardner; Baltimore Police Commissioner Anthony W. Batts; and Howard County State’s Attorney Dario Broccolino.
According to his plea agreement, Preston was a member of the Bloods since at least 2007. Preston has supported fellow incarcerated gang members, participated in gang meetings and discussions regarding gang sanctions, and planned retaliation against gang members suspected of cooperation. Preston is a leader of the “Swann” set, a sub-group of the Bloods. Preston achieved the rank of “O.Y.G” or “O.G.,” (Original Young Gangster or Original Gangster), terms used for a leader in the gang with authority over other Bloods members.Preston and his co-defendants were identified as members of the Bloods as the result of a long term investigation conducted by ATF and the Howard County Police Department. The investigation included four court ordered wiretaps on gang members’ cell phones. The Bloods, a national criminal street gang with members operating in and around Howard County, Maryland, committed violent acts within the gang to maintain discipline, and against rival gangs.
The investigation began with an assault and robbery of an ATF confidential informant in Columbia, Maryland, on November 8, 2011. The ATF was planning a controlled purchase of firearms from co-defendant and fellow gang member Michael Johnson, a/k/a “Ace,” a/k/a “Bloody Mike” after Johnson provided via text two photos of firearms, an assault rifle and a handgun, available for purchase by the CI. Instead, Johnson directed other gang members to rob the CI. Investigation revealed that Preston had been in contact with Johnson on the day of the robbery and was photographed holding the same rifle pictured in the texts sent to the ATF CI.
Among his criminal activities as a gang member, Preston admitted that he: attended gang meetings, supported incarcerated gang members, participated in discussion regarding gang sanctions, and planned and executed retaliation against others who he felt undermined his authority within the gang. Preston also planned, participated and approved of acts of violence, and was a leader in drug trafficking to and with fellow gang members. Preston, and his Bloods associates, regularly carried firearms in connection with and in furtherance of their unlawful acts. Preston admitted to directing or participating in at least 4 assaults, including a March 18, 2012, assault over a drug debt during which Preston threatened to later return and “shoot up the place,” a February 21, 2013, attempted assault of an individual causing problems with members and associates of Preston’s set, an April 12, 2013, attempted assault of someone Preston described as a “fake Blood,” and an April 20, 2013, assault of a former gang member with a knife and mace in a convenience store. The convenience store assault was captured on video, and Preston is seen hitting the girlfriend of the gang member in her face and attempting to spray her with mace. Citizens, including a young child, were injured by the mace sprayed by Preston during the assault. Preston was later overheard by law enforcement admitting to the assault and stating that if he’d had his gun with him Preston would have killed the man.
Preston also admitted that he began selling drugs, including crack cocaine and oxycocone, as early as 2007. Between February and May 2013, Preston was intercepted on numerous wiretap calls with other co-defendants discussing narcotics sales. Two co-defendants each supplied Preston with at least 9000 mg of Oxycodone.
On May 8, 2013, law enforcement executed multiple search warrants and arrested approximately 20 individuals connected with the Bloods gang, including Preston. A search warrant executed at Preston’s residence recovered, among other things, a .22 caliber revolver, with one live round of ammunition, brass knuckles, various prescription pills, marijuana, $1,222 in cash, and several cellular telephones. Preston has prior convictions for armed robbery and attempted armed robbery, and, as a result, was prohibited from possessing a firearm.
Preston and the government have agreed that if the Court accepts the plea agreement, Preston will be sentenced to 20 years in prison. U.S. District Judge George L. Russell III scheduled sentencing for February 6, 2015, at 11:30 a.m.
To date, 19 defendants have pleaded guilty to their roles in the racketeering and drug conspiracies. Judge Russell has sentenced co-defendants Michael Dominique Johnson, a/k/a "Ace", age 20, of Columbia, Maryland to 205 months in prison and Kenneth Ragan-Armstrong, a/k/a "Keezy," age 23, of Savage and Laurel, Maryland, to 193 months in prison; and David Jerome Robertson, age 23, of Columbia, Maryland to 81 months in prison. Co-defendants Giovanni Wright, a/k/a "G," age 22, of Elkridge, Maryland, Ryan Gladden, a/k/a "Fats," age 26, and Kyle Austin, a/k/a "Fowdy," age 23, pleaded guilty to their roles in the conspiracy and are scheduled to be sentenced on January 16, 2015; December 12, 2014; and December 22, 2014, respectively.
Mr. Rosenstein commended the ATF, Howard County Police Department, Baltimore Police Department and Howard County State’s Attorney’s Office for their work in this investigation and prosecution. Mr. Rosenstein thanked Assistant U.S. Attorneys Rachel M. Yasser and Sandra Wilkinson, who are prosecuting the case.Last of 4 Methamphetamine Traffickers Sentenced to PrisonRead the Press Release
SACRAMENTO, Calif. — The last of four methamphetamine traffickers, Jose Angel Martinez Chairez, 39, was sentenced today to 10 years in prison, United States Attorney Benjamin B. Wagner announced.
On July 29, 2014, Angel Martinez Diaz, 27, was sentenced to 10 years in prison and Jose Ramirez Verduzco, 29, was sentenced to 13 years in prison. On August 12, 2014, Jose Maria Villareal, 26, was sentenced to 11 years and three months in prison. All four defendants formerly resided in San Jose.
According to court documents, on July 10, 2013, the four defendants travelled in two vehicles from San Jose to a shopping center just off Interstate Highway 5 in Anderson, to sell a large quantity of crystal methamphetamine to an individual who purported to be interested in purchasing the drugs. In reality, that person was a confidential informant working for law enforcement agents. Under surveillance by the agents, the informant met with Martinez Diaz, Martinez Chairez, and Villareal who showed him a one-kilogram package of crystal methamphetamine represented to be a sample of the total 14 kilograms brought to sell to the CI. After a short discussion, the remaining drugs were brought up to the site in a second vehicle with a hidden compartment. Law enforcement agents watched as the defendants showed the remaining methamphetamine, after which the agents closed in and arrested the four defendants.
A total of 13.868 kilograms (30.5 pounds) of 99 percent pure crystal methamphetamine was seized. This represents approximately 2,760 dosage units according to documents filed in the case. That amount of drugs was three times the top level of the U.S. Sentencing Guidelines Drug Table, even taking into account the recent amendments passed by the U.S. Sentencing Commission which increased the amount of drugs needed to reach this highest level.
According to U.S. Attorney Benjamin Wagner, “Methamphetamine is, by far, the largest drug problem faced in California in terms of the number of people abusing it and the detrimental impact it has on society. A 2013 study commissioned by the Office of National Drug Control Policy titled “Adam II” showed that slightly over 50 percent of the recently arrested inmates at the Sacramento County Jail tested positive for methamphetamine. That was an increase of 10 percent over the prior year. Additionally, the increase in both the quantity and quality of the methamphetamine seized in the last three years in the drug cases prosecuted by this office shows a marked increase in the availability of high purity crystal methamphetamine, which is often traced back to drug trafficking organizations in Mexico.”
This case was the product of an investigation by the U.S. Drug Enforcement Administration –Redding Resident Office and the Shasta County Interagency Narcotics Task Force. Assistant United States Attorney Richard Bender prosecuted the case.
- Laredo Jury Convicts South Carolina Man for Alien Trafficking
Key West Family Pleads Guilty to Drug TraffickingRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Alysa D. Erichs, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), Miami Field Office, announce that defendants Juan Francisco Soca, Sr., 64, of Stock Island, pled guilty yesterday to one count of possession with the intent to distribute cocaine, in violation of Title 21, United States Code, Section 841(a)(1), and his son, Juan Francisco Soca, Jr., 43, of Key West, pled guilty to conspiracy to possess with the intent to distribute cocaine, in violation of Title 21, United States Code, Section 846. Sentencing is scheduled for December 15, 2014, at 2:00 p.m., before U.S. District Judge Jose Martinez. At sentencing, Juan Francisco Soca, Sr., faces up to 40 years in prison and Juan Francisco Soca, Jr., faces up to life in prison. Jose Antonio Soca, 38, of Stock Island, a cousin of Juan Francisco Soca, Jr., who had previously pled guilty to conspiracy to possess with the intent to distribute cocaine, was sentenced yesterday by Judge Martinez to 55 months in prison.
According to court documents, Juan Francisco Soca, Jr. and Jose Antonio Soca each sold cocaine to a confidential source on separate occasions, and based on those transactions, law enforcement officers obtained and executed a search warrant for the mobile homes where Juan Francisco Soca, Sr. and Jose Antonio Soca lived on Stock Island. Law enforcements officers found $235,398 in cash hidden inside pipes, 7.5 grams of cocaine base, and 3,084 grams of cocaine buried in the yard of Juan Francisco Soca, Sr. On the adjoining property of Jose Antonio Soca, officers found approximately 5,880 grams of cocaine, 570 30-mg oxycodone tablets, 1,332 alprazolam tablets, and $4,370 in cash.
During the arrest of Soca, Jr. on January 29, 2014, outside of his apartment located in Key West, officers found him in possession of 360 30-mg oxycodone tablets and $12,493 in cash. Of this money, $1,305 matched the prerecorded currency that the confidential source had given to Soca, Jr. during the transaction on January 28, and $200 matched the currency given by the confidential source to Jose Antonio Soca during the transaction on January 23. During a consensual search of the storage unit at Soca, Jr.’s apartment, officers found 164 oxycodone pills. Officers also executed a search warrant at a shed located at the Stock Island Lobster Company where Soca, Jr. had engaged in a cocaine transaction with the confidential source. During the search, the officers found 19 grams of cocaine, 958 grams of marijuana, and 132 30-mg oxycodone tablets.
Mr. Ferrer commended the investigative efforts of ICE-HSI, the Key West Police Department and the Monroe County Sheriff’s Office. This case is being prosecuted by Assistant U.S. Attorney Michael Thakur and Special Assistant U.S. Attorney Mark Wilson.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Key Player in Advance Pay Scheme Gets 16 Years for Stealing Millions from Hopeful EntrepreneursRead the Press Release
PHILADELPHIA – Matthew McManus, 46, of Glenside, Pennsylvania, was sentenced today to 16 years in prison for his role in an advance fee fraud scheme that defrauded hundreds of victims searching for commercial financing from Remington Financial Group. McManus was one of six people charged in the scheme. He was convicted at trial on February 19, 2014. His co-defendants all pleaded guilty. The scheme defrauded more than 1,900 victims out of more than $26 million. In addition to the prison term, U.S. District Court Judge William Yohn ordered restitution of $17,774,174, three years of supervised release, and an $800 special assessment.
Andrew Bogdanoff, of Scottsdale, Arizona, was the founder and chairman of Remington Financial Group (later renamed Remington Capital) and ran the company with McManus until 2008 in Arizona and Pennsylvania. After McManus left the company in 2008, defendant Shayne Fowler, also of Scottsdale, replaced McManus as Bogdanoff=s right-hand man. Defendant Joel Nathanson, of San Diego, California, was one of Remington=s most proficient employees and helped Remington defraud many victims. Defendant Frank Vogel, of Rochester Hills, Michigan, was a Michigan‑based broker who referred numerous victims to Remington in exchange for large kickbacks. Aaron Bogdanoff, also of Scottsdale, was also charged in the conspiracy.
Between 2005 and 2011, the defendants fraudulently induced hundreds of people to pay Remington fees in excess of $10,000 a piece, based on false representations that Remington had lenders and/or investors ready to provide financing for the victims= projects. To facilitate this fraud, the defendants issued each victim a Aletter of interest,@ commonly referred to as an LOI. Almost every LOI Remington issued stated that Remington had a lender or investor interested in financing the victim=s project. Remington issued an LOI to every victim even though no Remington employee had spoken to any funding source and Remington knew that it was unlikely to find funding for the project.
The LOI was written to fraudulently lead victims to believe that Remington either was an actual lender or had spoken to lenders that had already expressed interest in the customer's project. Neither was true. Additionally, the financing terms Remington included in the LOI were unrealistic and were used solely to induce customers to pay Remington's advance fees. In addition to the false representations in the LOI, the defendants and other Remington employees also told victims the following lies to further induce victims to pay Remington=s fees: a) Remington had five investors or lenders interested in their project; b) Remington was the actual lender for the project; c) Remington funded or Aclosed@ 80 percent of its deals; d) the victim would get funding for the project once the advance fee was paid and/or; e) Remington would provide funding through its funding source Northbridge. After a customer paid Remington=s fee, McManus and Andrew Bogdanoff instructed Remington employees to find problems with the projects so that Remington could blame its failure to provide financing on the victim. The defendants did this to help protect Remington from civil and criminal complaints.
After the FBI and IRS conducted search warrants in Arizona and Colorado in March 2011, defendant Matthew McManus attempted to distance himself from the fraudulent scheme by obstructing justice and lying to federal agents. He was convicted of these charges, as well.
Some of the defendants used sophisticated means to perpetuate the fraud. For instance, in 2010, defendants Fowler and Andrew Bogdanoff used Remington's website to advertise an anti‑fraud policy and stated falsely that Remington had recently provided information to the Federal Bureau of Investigation and local law enforcement authorities about a suspected email scam. Remington posted this information to ensure that if potential customers used an internet search engine to search for allegations about Remington's fraud, they would be directed to Remington's website rather than third‑party internet sources that contained negative information about Remington.
Andrew Bogdanoff is serving a 220 month prison sentence; Shane Fowler was sentenced to 21 months in prison; Joel Nathanson was sentenced to 12 months and one day in prison; Aaron Bogdanoff was sentenced to two years of probation; Frank Vogel will be sentenced in the Eastern District of Michigan on December 3, 2014.
The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service Criminal Investigations with assistance from the Pennsylvania Securities Commission. It was prosecuted by Assistant United States Attorney David Axelrod.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Kathy Winters Sentenced to 40 Months in Prison for Theft of Government FundsRead the Press Release
KNOXVILLE, Tenn. – On Oct. 7, 2014, Kathy Winters, 58, of Harriman, Tenn., was sentenced by the Honorable Pamela Reeves, U.S. District Court Judge, to serve 40 months in prison. Upon her release from prison, she will be under supervision of the U.S. Probation Office for three years. She was also ordered to pay a total of $428,076.94 in restitution, which represented the amount taken from three separate entities discussed below.
In May 2014, Winters pleaded guilty to a one-count information charging her with theft of government funds from the U.S. Department of Education. According to the plea agreement on file with U.S. District Court, Winters served as treasurer for the Tennessee Attendance Supervisors Steering Committee (TASSC), an organization that provides training and information to aid school attendance personnel in improving their professional competencies.
In the fall of 2012, the Tennessee Comptroller of the Treasury became aware of irregularities in the TASSC bank account and an investigative audit followed. The audit revealed that $82,636.79 was missing from the TASSC bank account during the time Winters had access to the funds. The investigation expanded to two additional entities when investigators found that she also served as federal projects administrative assistant for the Alcoa City School District and treasurer for East Tennessee Attendance Supervisors Association (ETASA), an association that provides opportunities for the continuous study of attendance problems. This broadened investigation revealed that ETASA suffered financial losses of $1,236.36. Additionally, Alcoa City School District suffered $344,203.79 in financial losses, which included federal grant money paid to the school district for special education expenses.
Winters took the money by creating false invoices which demanded payment to TASSC or ETASA, forging an approving official’s signature to the invoices, and forwarding them to Alcoa City for payment. Winters endorsed the checks issued by Alcoa City as payment for the false invoices. She then either deposited the funds into her personal account or into either the TASSC or ETASA account and then withdrew the money by a check payable to her or through an ATM withdrawal.
In addition to the invoice scheme, Winters made unauthorized personal charges on Alcoa City School District credit cards and falsified travel reimbursement requests for unauthorized travel. In both instances, she forged signatures of approving officials and submitted the credit card billing statements and travel claims to the Alcoa City for payment.
“Those who are entrusted with public funds and choose to embezzle them for their own personal use will be aggressively investigated and prosecuted,” said U.S. Attorney Bill Killian.
Agencies involved with this investigation included the Tennessee Comptroller’s Office, Financial Compliance Unit and Tennessee Bureau of Investigation. Assistant U.S. Attorney Brooklyn Sawyers represented the United States.
Justice Department Sues Three Owners of Memphis-Area Tax Return Preparation StoresRead the Press Release
The United States filed a civil injunction suit in Memphis, Tennessee, to bar three individuals from owning or operating a tax return preparation business or preparing tax returns for others, the Justice Department announced today.
Shandon Allen, Tabitha Tunstall and Shewanda Hamilton previously managed Mo’ Money Taxes stores in Memphis, but more recently have prepared tax returns under the names Southern King Taxes, Tabitha’s Taxes, LaQuita’s Professional Tax Service and Cash King Tax Service, according to the complaint. The United States previously obtained an injunction permanently barring the owners of Mo’ Money Taxes, Markey Granberry and Derrick Robinson, as well as a former Mo’ Money manager, Eumora Reese, from preparing tax returns for others and owning or operating a tax return preparation business.
The complaint alleges that the defendants and their employees prepare fraudulent tax returns that cause their customers to incorrectly report their federal tax liabilities and underpay their taxes. According to the complaint, the defendants and their employees prepare federal tax returns on which they falsely claim the Earned Income Tax Credit, improper filing status and bogus education credits. Additionally, the defendants and their employees allegedly improperly prepare tax returns using paystubs rather than W-2 forms, fabricate bogus W-2 forms and file tax returns without customers’ consent while charging deceptive and unconscionable fees, according to the suit.
Return preparer fraud is one of the Internal Revenue Service’s (IRS) Dirty Dozen Tax Scams for 2014. The IRS has some tips on their website for choosing a tax preparer. In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Related Materials:
United States v. Shandon Allen, et al.
Complaint for Permanent Injunction and Other ReliefIron Station, N.C. Man Sentenced in Connection with Home BurglariesRead the Press Release
STATESVILLE, N.C. – On Monday, October 6, 2014, U.S. District Judge Richard L. Voorhees sentenced Miquan Limik Smith, 27, of Iron Station, N.C. to 63 months in prison, followed by 24 months of supervised release for conspiracy to receive stolen firearms by committing burglaries and violating other federal firearms laws, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina.
Wayne L. Dixie, Special Agent in Charge of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Charlotte Field Division and Sheriff Phillip H. Redmond of the Iredell County Sheriff’s Office join U.S. Attorney Tompkins in making today’s announcement.
According to court documents and yesterday’s sentencing hearing, on or about January 31, 2013, Smith and his co-conspirator, Trishton Philemon Johnson, 26, of Charlotte, carried out two home burglaries in Iredell County, stealing firearms and other items of value. Court records show that law enforcement officers were alerted to the break-ins, identified the vehicle the defendants were in, and pulled the vehicle over on Interstate 77 in Iredell County. According to court records, the defendants drove off and, after a high speed chase, law enforcement officers stopped the vehicle. Johnson was arrested at the vehicle stop but Smith, who had fled the scene on foot, was arrested shortly thereafter.
Johnson pleaded guilty in July 2013 to one count of receiving stolen firearms and aiding and abetting. He was sentenced in March 2014 to 24 months in prison, followed by two years of supervised release.
In November 2013, a federal jury convicted Smith on all charged violations, including one count of conspiracy to receive stolen firearms by committing burglaries, one count of receiving stolen firearms, and one count of possession of a firearm by a felon.
Smith has been in federal custody and will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
The investigation was handled by ATF and the Iredell County Sheriff’s Office. The case was prosecuted by Assistant United States Attorneys Jennifer L. Dillon and Kenneth M. Smith of the U.S. Attorney’s Office in Charlotte.
Information: Federal Court ArraignmentsRead the Press Release
The United States Attorney's Office announced that those persons listed below were arraigned before the U.S. Magistrate and the indictments handed down by the Grand Jury unsealed.
Appearing before U.S. Magistrate Judge Ostby in Billings on October 7, 2014, and entering pleas of Not Guilty were:
JEDIA JAMES BARSNESS, a 23-year-old resident of Billings, appeared on charges of aiding and abetting in false statement during a firearms transaction. If convicted of the charge contained in the indictment, BARSNESS faces 10 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives. PACER Case Reference: 14-92
Appearing before U.S. Magistrate Judge Strong in Great Falls on October 7, 2014, and entering pleas of Not Guilty were:
RAED AROOK, a 38-year-old resident of Israel, appeared on charges of illegal re-entry. If convicted of the charge contained in the indictment, AROOK faces 10 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the U.S. Border Patrol. PACER Case Reference: 14-91
RONALD JOSEPH FOURHORNS, a 31-year-old resident of Browning, appeared on charges of bank robbery, theft, conspiracy to tamper with a witness by intimidation, threats, and corrupt persuasion, and tampering with a witness by intimidation, threats, and corrupt persuasion. If convicted of the most serious charges contained in the indictment, FOURHORNS faces 20 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the Federal Bureau of Investigation. PACER Case Reference: 14-52
RAYMOND EUGENE RUSSETTE, a 38-year-old resident of Wolf Point, appeared on charges of conspiracy to possess with intent of distribute methamphetamine, possession with intent to distribute methamphetamine, and distribution of methamphetamine. If convicted of the most serious charges contained in the indictment, RUSSETTE faces 40 years in prison, $5,000,000 in fines and 4 years supervised release. The case was investigated by the Bureau of Indian Affairs. PACER Case Reference: 14-93
Appearing before U.S. Magistrate Judge Strong in Great Falls on October 6, 2014, and entering pleas of Not Guilty were:
JOE LONG KNIFE, a 38-year-old resident of Hayes, appeared on charges of kidnapping, aggravated sexual abuse, assault with a dangerous weapon, assault resulting in serious bodily injury, and strangulation. If convicted of the most serious charges contained in the indictment, LONG KNIFE faces life in prison, $250,000 in fines and 5 years supervised release. The case was investigated by Federal Bureau of Investigation. PACER Case Reference: 14-92
Appearing before U.S. Magistrate Judge Ostby in Billings on October 2, 2014, and entering pleas of Not Guilty were:
DAVID LEE GOFFENA, a 46-year-old resident of Roundup, appeared on charges of conspiracy to possess with intent to distribute methamphetamine, distribution of methamphetamine, and conspiracy to money launder. If convicted of the most serious charges contained in the indictment, GOFFENA faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by Federal Bureau of Investigation, Eastern Montana HIDTA and Montana Division of Criminal Investigations. PACER Case Reference: 14-38
KIRSTA ELAINE GOFFENA, a 38-year-old resident of Roundup, appeared on charges of conspiracy to possess with intent to distribute methamphetamine, distribution of methamphetamine, and conspiracy to money launder. If convicted of the most serious charges contained in the indictment, GOFFENA faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by Federal Bureau of Investigation, Eastern Montana HIDTA and Montana Division of Criminal Investigations. PACER Case Reference: 14-38
Appearing before U.S. Magistrate Judge Lynch in Missoula on October 2, 2014, and entering pleas of Not Guilty were:
JARED THOMAS ATCHLEY, a 24-year-old resident of Helena, appeared on charges of possession of an unregistered firearm. If convicted of the charge contained in the indictment, ATCHLEY faces 10 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by Bureau of Alcohol, Tobacco, Firearms and Explosives and the Montana Highway Patrol. PACER Case Reference: 14-06
Appearing before U.S. Magistrate Judge Ostby in Billings on September 30, 2014, and entering pleas of Not Guilty were:
DAVID DELCARMEN, a 32-year-old resident of Los Angeles, California, appeared on charges of conspiracy to possess with intent to distribute methamphetamine and possession with intent to distribute methamphetamine. If convicted of the most serious charges contained in the indictment, DELCARMEN faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by Federal Bureau of Investigation, Eastern Montana HIDTA and Montana Division of Criminal Investigations. PACER Case Reference: 14-38
HEATHERLYN KYRIE FORE, a 26-year-old resident of Taft, California, appeared on charges of conspiracy to possess with intent to distribute methamphetamine and possession with intent to distribute methamphetamine. If convicted of the most serious charges contained in the indictment, FORE faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by Federal Bureau of Investigation, Eastern Montana HIDTA and Montana Division of Criminal Investigations. PACER Case Reference: 14-38
CATHRINE SUE NEEL, a 50-year-old resident of Taft, California, appeared on charges of conspiracy to possess with intent to distribute methamphetamine and possession with intent to distribute methamphetamine. If convicted of the most serious charges contained in the indictment, NEEL faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by Federal Bureau of Investigation, Eastern Montana HIDTA and Montana Division of Criminal Investigations. PACER Case Reference: 14-38
Appearing before U.S. District Judge Watters in Billings on September 30, 2014, and entering pleas of Not Guilty were:
DAVID LEE BARNARD, JR, a 43-year-old resident of Billings, appeared on charges of conspiracy to possess with intent to distribute methamphetamine, possession with intent to distribute methamphetamine, distribution of methamphetamine, possession of a firearm in furtherance of a drug trafficking crime, and conspiracy to commit money laundering. If convicted of the most serious charges contained in the indictment, BARNARD faces life in prison, $10,000,000 in fines and 5 years supervised release. The case was investigated by Federal Bureau of Investigation, Eastern Montana HIDTA and Montana Division of Criminal Investigations. PACER Case Reference: 14-38
EUGENE VERNON LAROCHE, a 48-year-old resident of Fairview, appeared on charges of use of a communication device to facilitate a felony drug trafficking offense. If convicted of the charge contained in the indictment, LAROCHE faces 4 years in prison, $250,000 in fines and 1 year supervised release. The case was investigated by the Drug Enforcement Administration, Montana Division of Criminal Investigations, Sidney Police Department, Richland County Sheriff's Office, Federal Bureau of Investigation, U.S. Border Patrol, Montana Highway Patrol and Sweetgrass County Sheriff's Office. PACER Case Reference: 14-43
Appearing before U.S. Magistrate Judge Lynch in Missoula on September 30, 2014, and entering pleas of Not Guilty were:
ALLEN J. RANKIN, a 41-year-old resident of St. Ignatius, appeared on charges of wire fraud, aggravated identity theft and mail theft. If convicted of the most serious charges contained in the indictment, RANKIN faces 20 years in prison, $250,000 in fines and 3 years supervised release. The case was investigated by the U.S. Postal Service, Missoula Police Department, Missoula County Sheriff's Office, Billings Police Department, Laurel Police Department and Lake County Sheriff's Office. PACER Case Reference: 14-33
If any of the above cases are of interest to your media organization and the community it serves, we encourage you to monitor the progress of the case regularly through the U.S. District Court calendar and the PACER system so that you stay current and not miss any important developments in the case.
To establish a PACER account, which will allow you to review documents filed in the case, please go to, http://www.pacer.gov/register.html. To access the district court's calendar, please go to https://ecf.mtd.uscourts.gov/cgi-bin/PublicCalendar.pl.
Indictment adds Charges against KC Man for Throwing Molotov Cocktails at Congressional OfficeRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Kansas City, Mo., man previously charged in federal court with throwing Molotov cocktails at the local congressional office of U.S. Rep. Emanuel Cleaver II was indicted by a federal grand jury today on additional charges.
Eric G. King, 28, of Kansas City, was charged in a four-count indictment returned by a federal grand jury in Kansas City, Mo. Today’s indictment replaces a federal criminal complaint that was filed against King on Sept. 17, 2014.
Today’s indictment contains the original charge against King of using a dangerous instrument to forcibly intimidate and interfere with a federal official engaged in the performance of his official duties. The indictment also charges King with one count of attempted arson for attempting to damage or destroy the building, one count of using explosive materials to commit a felony (arson) and one count of illegally possessing an incendiary device.
On Sept. 11, 2014, at 2:52 a.m., a window was broken and two Molotov cocktails were thrown at Cleaver’s congressional office located at 101 W. 31st Street, Kansas City, Mo. The office was unoccupied at the time of the incident. A hammer used to break the window was recovered from the scene, as well as two broken Molotov cocktails. There was not any fire damage done to the building.
According to an affidavit filed in support of the original criminal complaint, video footage shows King retrieve two bottles with a white ignition source from his backpack, then walk around the parking lot for a few minutes in an effort to hide from cars that were passing by. The footage allegedly shows King throwing a hammer through the west window and lighting the devices. The first device thrown appears to bounce off the side of the building. The second device is ignited and is thrown at the window. King allegedly sprints away from the office.
King was arrested as he was leaving his apartment on Sept. 16, 2014.
Dickinson cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Patrick C. Edwards. It was investigated by the FBI and the Kansas City, Mo., Police Department, the Federal Protective Service and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Grand Jury Charges Seven People in Oxy Trafficking ConspiracyRead the Press Release
PITTSBURGH – A federal grand jury returned a superseding indictment today against residents of Pennsylvania and Detroit, Michigan, on charges of violating the federal narcotics laws, United States Attorney David J. Hickton announced today.
The seven-count superseding indictment named:
- Telano Lanard White, 32, of Jackson, Michigan;
- Brandy Marie Bara, a/k/a Brandy Marie White, 33, of Turtle Creek, PA;
- Tarrance Mays, Jr., 30, of Fraser, Michigan;
- Lamont Eric Whitfield, 33, of Novi, Michigan;
- Corey Manuel Rodriguez, 28, of Pittsburgh, Pennsylvania;
- Nicole Goughler, 42, of Pittsburgh, PA; and
- Max Matthew Guardalabene, 29, of Pittsburgh, PA.
The superseding indictment expanded the period of the drug conspiracy to the Spring of 2011 to July 10, 2014 (the conspiracy charged in the original indictment spanned only May 13, 2014 to July 10, 2014). The superseding indictment also added significant forfeiture allegations which seek the forfeiture of, among other items, a Bentley Continental automobile and four other vehicles, more than $80,000 worth of jewelry, expensive Rolex watches, and $31,882 in U.S. currency. No additional defendants or charges were brought in the superseding indictment.
With respect to each count of the superseding indictment, the law provides for a maximum total sentence of 20 years in prison, a fine of $1,000,000 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 Stephen R. Kaufman is prosecuting this case on behalf of the government.
The Drug Enforcement Administration, Federal Bureau of Investigation, Pennsylvania Attorney General’s Office, Pennsylvania State Police, and the Pittsburgh Bureau of Police conducted the investigation leading to the superseding indictment.
Former Virginia Beach Probation Officer and Husband Sentenced for Conspiracy to Distribute MethamphetamineRead the Press Release
NORFOLK, Va. – Katherine M. Kephart, 31, of Norfolk, Va., was sentenced today to 78 months in prison for conspiracy to distribute and possess with intent to distribute five (5) grams or more of methamphetamine, commonly known as “ice.” Kephart’s husband, Charles M. Kephart, 43, of Norfolk, Va., was sentenced on January 23, 2014 to 78 months in prison for conspiracy to distribute and possess with intent to distribute five (5) grams or more of methamphetamine, commonly known as “ice.”
Dana J. Boente, Acting United States Attorney for the Eastern District of Virginia and Royce E. Curtin, Special Agent in Charge, Federal Bureau of Investigation Norfolk Office, made the announcement after sentencing by United States District Judge Arenda L. Wright Allen.
Katherine Kepart previously waived indictment and pled guilty on August 13, 2013. According to court documents, in November of 2012, a cooperating source informed the FBI that Katherine Kephart and her husband were involved in methamphetamine trafficking. The Kepharts were alleged to be obtaining quantities of methamphetamine from sources in the Ashville, North Carolina area and distributing in Virginia. They regularly used methamphetamine and associated with known methamphetamine traffickers. Katherine Kephart, who was a Virginia state probation and parole officer employed by the Virginia Beach Probation Office during this time, utilized her office facilities to further her husband’s drug trafficking activities. She also traveled with her husband to North Carolina to procure methamphetamine and distributed methamphetamine on multiple occasions. On February 28, 2013, Charles Kephart was arrested after he purchased 14 grams of methamphetamine during a controlled sale with the undercover officer. The FBI then executed a federal search warrant on the Kepharts’ residence in Norfolk. The search yielded drug paraphernalia, including at least seven small plastic bags or baggies, a piece of aluminum foil, four glass pipes, a spoon, two straws, a razor blade and an electronic scale. Many of these items later tested positive for methamphetamine residue.
This case was investigated by the Federal Bureau of Investigation. Assistant United States Attorney Darryl J. Mitchell is prosecuting the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.
Former United Commercial Bank Senior Vice President Pleads Guilty to ConspiracyRead the Press Release
OAKLAND – Thomas Yu pleaded guilty in federal court in San Francisco to charges of conspiracy to commit false bank entries, reports, and transactions related to his preparation of false and misleading reports, announced U.S. Attorney Melinda Haag; Federal Deposit Insurance Corporation, Office of the Inspector General, Special Agent in Charge Wade Walters; Office of the Special Inspector General for the Troubled Asset Relief Program, Special Agent in Charge Scott O'Briant; Board of Governors of the Federal Reserve System and the Consumer Financial Protection Bureau, Office of the Inspector General, Special Agent in Charge Scott Redington; and FBI Special Agent in Charge David J. Johnson.
Yu, 51, of San Ramon, Calif., is a former Senior Vice President of United Commercial Bank (UCB). UCB was a commercial bank headquartered in San Francisco, Calif., with branch offices throughout the United States as well as in China and Taiwan. Until 2009, its holding company, UCBH Holdings, Inc., was publicly traded on NASDAQ.
On Nov. 6, 2009, UCB was taken over by the Federal Deposit Insurance Corporation (FDIC). According to the March 11, 2014 Superseding Indictment, FDIC estimates that there will be approximately $1.1 billion in losses as a result of the bank’s failure. In addition, the Troubled Asset Relief Program (TARP) provided approximately $297 million in federal funds to UCB on Nov. 14, 2008, during the 2008 financial crisis. None of the TARP funds have been repaid.
According to the Plea Agreement, Yu prepared false and misleading quarterly loan loss allowance reports in which the bank calculated the loss reserves it was required to recognize as part of its quarterly financial reporting in the third and fourth quarters of 2008. By failing to properly downgrade poor performing loans, Yu admitted that he helped the bank avoid required loan loss reserves that enabled the bank to artificially inflate its reported earnings to the public. The conviction followed a change of plea hearing today before the Honorable Jeffrey S. White, United States District Court Judge.
Yu is currently released on a $500,000 appearance bond secured by real property. Yu’s sentencing hearing before Judge White has not been scheduled. The maximum statutory penalty for a conviction for conspiracy in violation of 18 U.S.C. § 371 is five years in prison and a fine of $250,000, plus restitution. However, any sentence will be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Adam A. Reeves and Robert David Rees are the Assistant U.S. Attorneys who are prosecuting the case with the assistance of Denise Oki, Phillip Villanueva and Bridget Kilkenny. The prosecution is the result of an investigation by the FDIC, Office of the Inspector General; the Special Inspector General of the Troubled Asset Relief Program; the Board of Governors of the Federal Reserve System and the Consumer Financial Protection Bureau, Office of the Inspector General; and the Federal Bureau of Investigation.
Former Puerto Rico Officer and Civilian Plead Guilty for July 2012 Robbery in Puerto RicoRead the Press Release
A former Police of Puerto Rico (POPR) sergeant and a civilian have pleaded guilty for their involvement in a July 2012 robbery in Bayamon, Puerto Rico, and an additional POPR officer has pleaded guilty to lying to federal agents, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Rosa Emilia Rodríguez-Vélez of the District of Puerto Rico.
Jorge Fernandez-Aviles, 49, a POPR sergeant, pleaded guilty today to robbery and firearms charges for his role in a July 2012 robbery in Bayamon, Puerto Rico. On Oct. 3, 2014, David Figueroa, 32, a civilian, pleaded guilty to robbery and civil rights charges for his involvement in the robbery. Alexander Mir-Hernandez, 40, a POPR officer, also pleaded guilty on Oct. 3, 2014, to one count of false statements for lying to federal agents about his role in the July 2012 robbery and to a civil rights crime for an unrelated December 2013 robbery. Sentencing for all three is scheduled for Jan. 9, 2015.
Pedro Lopez-Torres, 35, and Luis Ramos-Figueroa, 38, were each POPR officers and were charged by information on June 25, 2014, for their roles in the July 2012 robbery and other crimes. Lopez and Torres pleaded guilty before U.S. District Judge José A. Fusté the same day. Fernando Reyes-Rojas, a civilian, has been indicted for robbery, drug, and firearms charges for his involvement in the July 2012 robbery. Reyes-Rojas is scheduled for trial on Nov. 3, 2014.
According to court documents, on July 14, 2012, Sergeant Fernandez-Aviles and Officers Lopez-Torres and Ramos-Figueroa, armed with their POPR weapons, went with Figueroa, Ramos-Figueroa’s cousin, to the airport, where they picked up a marked patrol car from Officer Mir before a planned home robbery. They drove the patrol car to meet Reyes-Rojas and then went together to the location of the robbery.
Upon entering the house, the officers identified themselves as police, falsely claimed they were executing a search warrant, and ordered several individuals in the garage to the ground and searched for weapons. While Figueroa watched the occupants, Sergeant Fernandez, Officer Lopez-Torres, Officer Ramos-Figueroa, and Reyes-Rojas searched the property, and Reyes-Rojas found cocaine in a shed in the backyard. A few days later, Reyes-Rojas met with Lopez-Torres and gave him money from the proceeds of the sale of the cocaine he took on the day of the robbery. Officer Lopez-Torres split the money with Sergeant Fernandez-Aviles and Officer Ramos-Figueroa.
In June 2014, Officer Mir was interviewed by Special Agents of the Federal Bureau of Investigation and falsely claimed that he did not recognize a photograph of Officer Lopez-Torres; that he had not met with Officer Lopez-Torres in more than six months; and that he did not provide the patrol car that was used to commit the July 2012 robbery.
An indictment is merely an allegation, and a defendant is presumed innocent unless and until proven guilty.
This case was investigated by the FBI’s San Juan Division and is being prosecuted by Trial Attorney Heidi Boutros Gesch of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Mariana Bauza of the District of Puerto Rico.
Former President Pleads Guilty to Embezzling from UnionRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that the former president of the union representing Jackson County Department of Corrections employees pleaded guilty in federal court today to a wire fraud scheme in which he embezzled tens of thousands of dollars from the union local.
Jesse E. Morgan, 39, of Kansas City, Mo., pleaded guilty before U.S. Chief District Judge Greg Kays to one count of wire fraud.
Morgan was president of the American Federation of State, County and Municipal Employees (AFSCME) Local 1707 from 2008 through Oct. 20, 2012.
By pleading guilty today, Morgan admitted that he engaged in a wire fraud scheme during most of his tenure as president, from November 2008 through Oct. 22, 2012, to steal from AFSCME Local 1707. Morgan issued checks from Local 1707 to third parties for his benefit or himself; made electronic transfers from Local 1707 bank accounts to pay personal expenses; made unauthorized ATM withdrawals from Local 1707 bank accounts; and made unauthorized counter withdrawals from Local 1707 checking and savings accounts.
The government believes the theft exceeded $120,000 but was less than $200,000. Morgan admitted in today’s plea agreement that the loss exceeds $70,000. The federal indictment alleged that the loss was more than $185,000.
Under the terms of today’s plea agreement, Morgan must pay restitution to Local 1707 for the total amount of the loss. If there is no agreement as to the amount of loss, the court will decide the matter by a preponderance of the evidence.
Under federal statutes, Morgan is subject to a sentence of up to 20 years in federal prison without parole, plus a fine up to $250,000. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Paul S. Becker. It was investigated by the U.S. Department of Labor – Office of Labor-Management Standards.Former Federal Employee Charged with Defrauding Compensation FundRead the Press Release
PITTSBURGH – A McKeesport resident has been indicted by a federal grand jury in Pittsburgh on charges of wire fraud, federal employees’ compensation fraud and theft of government money, United States Attorney David J. Hickton announced today.
The 10-count indictment named Robert M. Sulesky, 52, as the sole defendant.
According to the indictment, Sulesky was a former, civilian equipment operator for the United States Department of the Army (DOA) who collected wage loss benefits under the Federal Employees’ Compensation Act. From Dec. 19, 2007, until July 26, 2012, Sulesky engaged in a scheme to defraud the United States Department of Labor and the DOA in order to receive, and to continue to receive, his compensation benefits at the higher rate reserved for employees with eligible dependents. It was part of the scheme that Sulesky made false and fraudulent statements concerning his marital status. Among the false statements submitted by Sulesky to the federal government as part of the scheme, Sulesky submitted a statement on Aug. 27, 2011 in which he falsely represented that he was married and was living with his wife, knowing that his divorce from his wife became effective on Nov. 21, 2009 and that he was not living with a spouse.
Sulesky faces a maximum sentence of 20 years imprisonment and a fine of $250,000 for each of the seven counts charging him with wire fraud, a maximum sentence of five years imprisonment and a fine of $250,000 for each of the two counts charging him with federal employees’ compensation fraud, and a maximum sentence of 10 years imprisonment and a fine of $250,000 for the one count charging him with theft of government money. 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 Mary McKeen Houghton is prosecuting this case on behalf of the government.
The Department of Labor, Office of Inspector General conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Former Chancery Judge Pleads Guilty to Federal Obstruction of JusticeRead the Press Release
Jackson, Miss. -- Joe Dale Walker, 61, of Monticello, Mississippi, pled guilty today in U.S. District Court to a criminal information charging him with obstruction of justice, announced U.S. Attorney Gregory K. Davis and FBI Special in Agent in Charge Don Alway.
Walker was charged with instructing a federal grand jury witness to destroy documents and then lying to FBI agents. He will be sentenced by Senior U.S. District Judge David C. Bramlette III on January 8, 2015 at 1:30 p.m. in Jackson, Mississippi. He faces a maximum penalty of twenty years in federal prison and a $250,000 fine.
From 2010 to the present, the defendant, Joe Dale Walker, was the elected Chancellor for the Thirteenth Chancery Court District of Mississippi, covering Covington, Jefferson Davis, Lawrence, Simpson and Smith Counties. In June 2011, Judge Walker directed the attorney he had appointed for a conservatorship to solicit bids from local contractors for the construction of a home for the ward. Five bids for construction of the home were obtained, including a bid from Judge Walker’s nephew, Chad Teater d/b/a C.T. Construction. Judge Walker reviewed the bids in his chambers and, upon discovering that Teater’s bid was much lower than the other bids, Walker instructed Teater to raise his bid. Teater subsequently submitted another bid which was $23,500 more than his original bid but still lower than the other bids. Due to his nephew’s involvement as a bidder for the Newsome house, Walker transferred the case to another Chancellor for the limited purpose of accepting and approving bids for the construction of the Newsome home. After signing an order awarding the contract to Teater, the case was transferred back to Walker.
Prior to August 7, 2013, a grand jury subpoena was served upon a witness to appear before a Federal Grand Jury on September 4, 2013, and to bring any and all documents relating to the Conservatorship. On August 7, 2013, Walker met with the witness and was informed of the Federal Grand Jury subpoena. During this meeting, Walker and the witness discussed the original bid from Teater, the fact that it was lower than the other bids and that Walker had instructed the witness to tell Teater to raise his bid. Walker also asked the witness about original bid and any existing copies.
When interviewed by agents of the Federal Bureau of Investigation on March 25, 2014, Walker denied ever talking with the witness about two bids submitted by Teater and denied ever telling the witness that Teater’s original bid needed to be “somewhere else” in response to the Federal Grand Jury subpoena.
This case was investigated by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney Mike Hurst.If you believe you have been a victim of fraud from a person or an organization soliciting relief funds on behalf of storm victims, contact the National Center for Disaster Fraud toll free at:
(866) 720-5721
You can also fax information to:
(225) 334-4707
or e-mail it to:
Making sure that victims of federal crimes are treated with compassion, fairness and respect.
Training and seminars for Federal, State, and Local Law Enforcement Agencies.
Help us combat the proliferation of sexual exploitation crimes against children.
Former CEO of San Francisco Technology Start-Up Pleads Guilty to Wire FraudRead the Press Release
SAN FRANCISCO – Jonathan Edward Mills, the former Chief Executive Officer of a San Francisco-based technology company, pleaded guilty in federal court in San Francisco today to two counts of wire fraud, United States Attorney Melinda Haag announced.
Mills founded Motionloft, Inc., in 2010, and he served as its CEO until he was fired in December 2013. In pleading guilty, Mills admitted that he falsely told victims that Motionloft was soon to be acquired by a well-known multinational company based in Silicon Valley. Mills told his victims that in exchange for providing him money to be invested in Motionloft, these investors would earn an ownership stake in Motionloft and massive profits upon completion of the imminent acquisition. In furtherance of his scheme, Mills claimed that the acquiring company had agreed to pay hundreds of millions of dollars to acquire Motionloft. When the purported acquisition failed to materialize, Mills told his victims a series of false excuses, including blaming lawyers, blaming the government shutdown, and blaming financial institutions. In pleading guilty, however, Mills admitted that not only was there no such acquisition planned, but Mills spent substantial amounts of his victims’ money on his own personal expenses such as vacations and other entertainment. In all, Mills admitted that he caused his victims to lose approximately $765,000.
Mills, 30, of San Francisco, was arrested on February 19, 2014, after a Criminal Complaint was filed against him. He was indicted by a federal Grand Jury on March 13, 2014. In that Indictment, he was charged with two counts of wire fraud, in violation of Title 18, United States Code, Section 1343, and four counts of money laundering, in violation of Title 18, United States Code, Section 1957. Pursuant to the Plea Agreement, Mills pleaded guilty to both counts of wire fraud.
Mills’ sentencing hearing is scheduled for February 3, 2015, before The Honorable Richard Seeborg, U.S. District Court Judge, in San Francisco. The maximum statutory penalty for each count of wire fraud, in violation of Title 18, United States Code, Section 1343, is 20 years in prison, a fine of $250,000, plus restitution. Any sentence, however, will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Doug Sprague is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Rawaty Yim and Muffy Mallory. The prosecution is the result of a two-month investigation by the Federal Bureau of Investigation.
(Mills indictment )
Former Bristol Resident Admits Operating $1.8 Million Investment SchemeRead the Press Release
Follow @USAO_CT
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that STEPHEN GOODRICH, 57, of Rocky Hill, waived his right to indictment and pleaded guilty today before U.S. Magistrate Judge Donna F. Martinez in Hartford to one count of mail fraud and one count of subscribing to a false tax return. The charges stem from GOODRICH’s operation of an investment scheme that defrauded investors out of more than $1.8 million.
According to court documents and statements made in court, GOODRICH formerly resided in Bristol where he conducted an investment business using the name Goodrich Financial. Although GOODRICH was not a licensed or registered investment adviser, he provided a business card to some investors that falsely represented that he was licensed to conduct an investment business. Beginning in approximately 2006 and continuing to approximately November 2012, GOODRICH engaged in a scheme to defraud individuals who had provided him with investment funds by failing to invest the funds as represented, and by using some of the investment funds for his personal use. At times, GOODRICH also used new investor funds to return the principal investment to older investors as is often done in Ponzi schemes. In order to prevent his investors from becoming aware of the scheme, GOODRICH provided written performance summaries to his investors that falsely represented the value of their investments. More than ten investors collectively lost more than $1.8 million as a result of this scheme.
During the years 2007 to 2011, GOODRICH used more than $600,000 of the investors’ funds for his personal use without disclosing this income on his federal tax returns. As a result, GOODRICH owes $239,443 in additional federal taxes, plus interest and penalties.
GOODRICH is scheduled to be sentenced by U.S. District Judge Alvin W. Thompson on December 30, 2014, at which time he faces a maximum term of imprisonment of 23 years, a fine of up to approximately $3.6 million and an order of restitution.
GOODRICH is released on a $25,000 bond.
This matter is being investigated by the Internal Revenue Service – Criminal Investigation Division, the Federal Bureau of Investigation and the U.S. Postal Inspection Service, with the assistance of the Connecticut Department of Banking. The case is being prosecuted by Senior Litigation Counsel Richard J. Schechter.
Citizens are encouraged to report any financial fraud schemes by calling, toll free, 855-236-9740, or by sending an email to [email protected].
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Florida Woman Pleads Guilty to Mail Fraud in LSU Health Sciences Center Bribery SchemeRead the Press Release
SHREVEPORT, La. –United StatesAttorney Stephanie A. Finley announced today that a Florida woman pleaded guilty to mail fraud in connection with a bribery scheme involving a former staff member at Louisiana State University Health Sciences Center (LSUHSC).
Rita M. Myler, 52, of Miramar Beach, Fla., pleaded guilty Monday before U.S. District Court Judge S. Maurice Hicks Jr. to one count of mail fraud. According to evidence presented at the guilty plea, Myler paid LSUHSC’s Human Leukocyte Antigen (HLA) laboratory assistant director Anthony Roggero kickbacks so that he would continue buying products from her company Sangre Biologicals. From July 2001 to July 2008, Myler mailed cash kickbacks to Roggero’s residence after LSUHSC would make a payment to her company. Sangre Biologicals received more than $540,000 from LSUHSC during the course of the scheme. The HLA laboratory played a critical support role for solid organ and bone marrow transplants, performing cross matching and tissue typing analyses. A former director of the HLA laboratory sought and obtained authority for Roggero to purchase up to $5,000 in Sangre products per month.
Myler faces up to 20 years in prison, five years supervised release, a $250,000 fine, and restitution. A sentencing date of January 26, 2015 was set. Roggero pleaded guilty on October 31, 2012 to one count of mail fraud for his role. Roggero’s sentencing date is November 10, 2014.
The FBI conducted the investigation. Assistant U.S. Attorney Cytheria D. Jernigan is prosecuting the case.
Florida Man Sentenced to Mandatory Two Years for Federal Income Tax Refund Fraud Scheme and Ordered to Pay $184,486.64Read the Press Release
The United States Attorney Kenyen R. Brown announces that Allen L. Bryant, a 48 year old resident of Jasper, Florida was sentenced today. Mr. Bryant pled guilty on June 16, 2014, to aggravated identity theft. Mr. Bryant received a mandatory two years of incarceration followed by one year of supervised release. Mr. Bryant participated in the scheme using the identities of deceased victims, their names, dates of birth and social security numbers to file for federal income tax refunds. He directed that the refunds be wired into his personal checking account.
Special Agents of the Internal Revenue Service/Office of Inspector General investigated the case and presented it to the U.S. Attorney's Office for prosecution. The prosecutor assigned to the case is Assistant United States Attorney, Gina S. Vann.
FCI Berlin Inmate Pleads Guilty ToRead the Press Release
Federal Weapon Possession Charge
CONCORD, NEW HAMPSHIRE – CONCORD, N.H. – Myron Armstrong, 38, an inmate at the Federal Correctional Institution in Berlin, New Hampshire, has entered a guilty plea in the United States District Court for the District of New Hampshire to one count of possessing a weapon in a federal correctional facility, announced United States Attorney John P. Kacavas.
In January 2014, Armstrong fashioned a makeshift weapon out of a combination lock and a sock, which he subsequently used to assault another inmate. Armstrong – who faces a maximum sentence of five additional years in prison and criminal fines of up to $250,000 – will be sentenced in January of 2015.
This prosecution arose from an investigation by the Federal Bureau of Investigation, in collaboration with the Federal Correctional Institution in Berlin, New Hampshire. The case is being prosecuted by Assistant United States Attorney Nick Abramson.Employee of Essex County Contractor Admits Tax ChargesRead the Press Release
TRENTON, N.J. – An employee of several related Parsippany, New Jersey-based construction companies today admitted underreporting significant amounts of cash income on his tax return, U.S. Attorney Paul J. Fishman announced.
Frank Chimento III, 46, of Verona, N.J., pleaded guilty before U.S. District Judge Michael A. Shipp in Trenton federal court to an information charging him with one count of subscribing to a false personal federal income tax return in 2007.
According to the documents filed in this case and statements made in court:
Chimento Construction, Chimento Construction Services, and FAC Construction, were commingled companies specializing in commercial masonry and concrete work (the “Chimento Companies”). From 2008 through 2011, the Chimento Companies’ primary construction job was the Palmer Square project in Princeton, New Jersey. Chimento Companies operated a cash payroll for a significant portion of the wages paid to employees during the period 2006 through 2011. Chimento worked for the Chimento Companies for more than 10 years and was one of the employees who received cash wages.
In 2007, Chimento briefly operated his own excavation business. An analysis of his bank accounts showed payments in 2007 from the Chimento Companies totaling $85,860. Chimento failed to report $45,860 of that income on his 2007 federal personal income tax return. He also admitted in court that he did not file individual income tax returns for 2008 through 2011 although he received approximately $100,000 in cash wages in 2008, and a total of $351,788 in cash wages during the years 2009 through 2011.The count of subscribing to a false tax return is punishable by a maximum potential penalty of three years in prison and a $250,000 fine. As part of his guilty plea, Chimento agreed to make full restitution to the IRS for all losses resulting from the filing of false tax returns. Sentencing is scheduled for Jan. 13, 2015.
U.S. Attorney Fishman credited special agents of the U.S. Department of Labor, Office of Inspector General, under the direction of Special Agent in Charge Cheryl Garcia New York Regional Office; and special agents of IRS-Criminal Investigation, under the leadership of Acting Special Agent in Charge Jonathan D. Larsen, for the investigation leading to today’s guilty plea. He also thanked the N.J. Department of Labor and Workforce Development, under the leadership of Commissioner Harold J. Wirths, for its assistance in the investigation.The government is represented by Senior Litigation Counsel Leslie Faye Schwartz of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
14-363Defense counsel: Paul John Casteleiro Esq., Hoboken, N.J.
ChimentoIII, Frank Information
East Pittsburgh Felon Sentenced to 15 Months in Prison for Possessing Ammunition, Fake Social Security CardRead the Press Release
PITTSBURGH - A resident of East Pittsburgh, Pa., has pled guilty and been sentenced in federal court to 15 months imprisonment on his conviction of possession of ammunition by an illegal alien and use of a false Social Security number, United States Attorney David J. Hickton announced today.
United States District Judge Nora Barry Fischer imposed the sentence on Guillermo Manuel Justo, a/k/a Rolando Velez Latore, 38.
According to information presented to the court, Justo, an illegal alien, on May 28, 2014, unlawfully possessed 81 rounds of .40 caliber Smith and Wesson ammunition and a social security card which falsely identified him as Rolando Velez Latore.
Prior to imposing sentence, Judge Fischer denied defendant’s motion for a sentence of “time served” and stated that it “was troubling” that, among other things Justo had pled guilty (and received probation) in a related gun case – while falsely representing his identity (as Rolando Velez Latore) to the Common Pleas Court.
Assistant United States Attorney Leo M. Dillon prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Homeland Security Investigations for the investigation leading to the successful prosecution of Justo.
Drug Trafficker Sentenced to 12 Years in PrisonRead the Press Release
PHOENIX – On Oct. 6, 2014, Everardo Duarte, 38, of Sonora, Mexico, was sentenced by U.S. District Judge G. Murray Snow to 12 years imprisonment. Duarte pleaded guilty on July 21, 2014 to possession with intent to distribute methamphetamine.
The year-long Organized Crime Drug Enforcement Task Force investigation into Duarte’s Drug Trafficking Organization (DTO) was initiated in July 2012 and was conducted primarily in Flagstaff. On July 16, 2013, the defendant and his two co-defendants, Dustin Heath Ash and Mitchell Allan McKinnon, were charged with possession with intent to distribute methamphetamine, possession with intent to distribute heroin, and conspiracy charges. Kevin Lynn Bickford was charged in a separate indictment with possession with intent to distribute methamphetamine.
The organization imported methamphetamine from Mexico into the United States, where it was ultimately distributed in Flagstaff, along with heroin. Co-defendants Ash, McKinnon, and Bickford were previously sentenced to terms of imprisonment.
The investigation in this case was initiated by the METRO Northern Arizona Narcotics Task Force, an organization made up of officers from the Flagstaff Police Department and the Coconino County Sheriff’s Office. The case was adopted federally by the FBI’s Northern Arizona Safe Streets Task Force, of which METRO is a part, working closely also with partners from the Bureau of Indian Affairs and the Drug Enforcement Administration. The prosecution was handled by Dimitra H. Sampson, Assistant U.S. Attorney, District of Arizona, Phoenix.
CASE NUMBER: CR-13-8158-PCT-GMS
RELEASE NUMBER: 2014-058_DuarteFor more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.Defense Contractor Agrees to Pay $13.7 Million to Settle Allegations of OverbillingRead the Press Release
DRS Technical Services Inc. (DRS) has agreed to pay $13.7 million to settle allegations that it violated the False Claims Act by knowingly overbilling the government for work performed by DRS personnel who lacked the job qualifications required by the contract, the Justice Department announced today. DRS is located in Herndon, Virginia, and is a subsidiary of DRS Defense Solutions LLC.
DRS designs, integrates, operates and maintains satellite and wireless network solutions and telecommunication services and security systems for government and private sector customers. DRS C3 & Aviation Company, which is headquartered in Gaithersburg, Maryland, is an indirect subsidiary of DRS and provides services to government agencies, including aircraft maintenance, logistics and depot support, and engineering support. Between March 2003 and Dec. 31, 2012, DRS and its predecessors were awarded time and materials contracts for services and supplies to be provided to the Army’s Communication and Electronics Command (CECOM) in Iraq and Afghanistan, and to the Coast Guard for aircraft maintenance.
“Contractors that fail to provide qualified labor as promised are not entitled to bill the government as though they had,” said Acting Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division. “The Department of Justice will pursue contractors that claim taxpayer funds to which they are not entitled.”
The alleged labor mischarging occurred on the Rapid Response or “R2” contract issued by the U.S. Army Communication and Electronics Command (CECOM) located at the Aberdeen Proving Ground in Maryland. The U.S. Army used the R2 contract to purchase a variety of goods and services needed to support U.S. forces in Iraq, Afghanistan and elsewhere on a quick turnaround basis. The settlement also resolves labor mischarging on a similar U.S. Coast Guard contract.
The government contends that from Jan. 1, 2003, to Dec. 31, 2012, DRS billed CECOM for work performed by individuals whose job qualifications did not meet all the qualifications prescribed by the contracts for the labor categories under which their efforts were billed, thereby falsely increasing the amount of money DRS claimed and CECOM paid. Similarly, from Dec. 19, 2009, to Dec. 18, 2011, the government contends that DRS charged the Coast Guard’s Aviation Logistics Center for work performed by individuals whose job qualifications did not meet the qualifications prescribed by the contract, again, thereby inflating the cost of the services provided.
“Companies that submit false bills to the government must be held accountable,” said U.S. Attorney Rod J. Rosenstein for the District of Maryland.
“This settlement is yet another example of the tenacity and hard work of our Army CID agents,” said Director Frank Robey of the U.S. Army Criminal Investigation Command's Major Procurement Fraud Unit (MPFU). “It is a testament to MPFU's continued resolve to hold companies accountable for the work they do for the U.S. government.”
The settlement was the result of a coordinated effort by the U.S. Attorney’s Office for the District of Maryland, the Civil Division, the Defense Contract Audit Agency, the Army’s Criminal Investigative Command’s MPFU and the Department of Defense Office of Inspector General’s Defense Criminal Investigative Service.
The claims resolved by the settlements are allegations only and there has been no determination of liability.
Defense Contractor Agrees to Pay $13.7 Million to Settle Allegations of OverbillingRead the Press Release
Baltimore – DRS Technical Services, Inc. has agreed to pay $13.7 million to settle allegations that it violated the False Claims Act by overbilling the government for work performed by DRS personnel who lacked the job qualifications required by contract.The settlement was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Acting Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division; Special Agent in Charge Robert Craig of the Defense Criminal Investigative Service (DCIS) Mid-Atlantic Field Office, an investigative arm of the Department of Defense – OIG; Frank Robey, Director of the U.S. Army Criminal Investigation Command's Major Procurement Fraud Unit; and the Defense Contract Audit Agency (DCAA), an audit arm of the Department of Defense;.
“Companies that submit false bills to the government must be held accountable,” said U.S. Attorney Rod J. Rosenstein.
“Contractors that fail to provide qualified labor as promised are not entitled to bill the government as though they had,” said Acting Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division. “The Department of Justice will pursue contractors that claim taxpayer funds to which they are not entitled.”DRS Technical Services, Inc. (DRS) is principally located in Herndon, Virginia and is a subsidiary of DRS Defense Solutions LLC. DRS designs, integrates, operates and maintains satellite and wireless network solutions and telecommunication services and security systems for government and private sector customers. DRS C3 & Aviation Company, which is headquartered in Gaithersburg, Maryland, is an indicrect subsidiary of DRS and provides services to government agencies, including aircraft maintenance, logistics and depot support, and engineering support. Between March 2003 and December 31, 2012, DRS and its predecessors were awarded time and materials contracts for services and supplies to be provided to the Army’s Communication and Electronics Command (CECOM) in Iraq and Afghanistan, and to the Coast Guard for aircraft maintenance.
The government contends that from January 1, 2003 to December 31, 2012, DRS billed CECOM for work performed by individuals whose job qualifications did not meet all the qualifications prescribed by the contracts for the labor categories under which their efforts were billed, thereby falsely increasing the amount of money DRS claimed and CECOM paid. Similarly, from December 19, 2009 to December 18, 2011, the government contends that DRS charged the Coast Guard’s Aviation Logistics Center for work performed by individuals whose job qualifications did not meet the qualifications prescribed by the contract, again, thereby inflating the cost of the services provided.
“This settlement is yet another example of the tenacity and hard work of our Army CID agents,” said Director Frank Robey of the U.S. Army Criminal Investigation Command's Major Procurement Fraud Unit (MPFU). “It is a testament to MPFU's continued resolve to hold companies accountable for the work they do for the U.S. government.”
The claims resolved by the settlements are allegations only and there has been no determination of liability.
The settlement was the result of an investigation by the U.S. Attorney’s Office for the District of Maryland, the Justice Department’s Civil Division, DCAA, DCIS and the Army’s CID Investigative Command’s MPFU. Assistant U.S. Attorney Tarra DeShields handled the case.Couple Pleads Guilty to $99,000 Social Security FraudRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Nevada, Mo., husband and wife pleaded guilty in federal court today to making false statements as part of a $99,000 scheme to defraud Social Security.
Reta Jo Carpenter, 53, and her husband, Oren Daniel Carpenter, 52, both of Nevada, each waived their right to a grand jury and pleaded guilty in separate appearances before U.S. Magistrate Judge David P. Rush to making false statements to a federal government agency.
According to today’s plea agreement, Reta Carpenter is unemployed, disabled and married to Oren Carpenter (an employee of the Nevada R-5 School District). She had been receiving Supplemental Security Income (SSI) benefits since 1990.
The Carpenters admitted today that Reta Carpenter falsely stated on her benefit application in 1997 that Oren Carpenter no longer resided with her. As a result, the Social Security Administration removed Oren Carpenter from the household in its records, and Oren Carpenter’s annual income was no longer considered in determining Reta Carpenter’s eligibility for SSI benefits. This resulted in overpayments to Reta Carpenter totaling $99,411 as of August 23, 2012.
Reta Carpenter later repeated this claim on written forms, and both Reta and Oren Carpenter repeated this claim in interviews with federal agents.
Under federal statutes, Reta and Oren Carpenter are each subject to a sentence of up to five years in federal prison without parole, plus a fine up to $250,000 and an order of restitution. Sentencing hearings will be scheduled after the completion of presentence investigations by the United States Probation Office.
These cases are being prosecuted by Assistant U.S. Attorney Steven M. Mohlhenrich. They were investigated by the Social Security Administration, Office of Inspector General.Clifton, N.J., Ambulance Service Provider Arrested, Charged with Health Care FraudRead the Press Release
Company In Top 3 Percent of Transport Provider Medicare Earners After Operator Barred From Medicare Participation for Previous Crime
NEWARK, N.J. – A Passaic County man who operates a lucrative New Jersey ambulance company was arrested this morning at his home by special agents of the FBI and the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG) on charges he ran the service after being barred from doing business with Medicare and laundered government payments, U.S. Attorney Paul J. Fishman announced.
Imadeldin Awad Khair, 54, of Paterson, New Jersey, is charged by complaint with one count of health care fraud and one count of money laundering. He is expected to appear today before U.S. Magistrate Judge Michael A. Hammer in Newark federal court.
According to the criminal complaint unsealed today:
As a result of his 2003 conviction on a New Jersey state health care charge, Khair was excluded from participating in any capacity in Medicare, Medicaid, or other federal health care program for a minimum period of 11 years.
Despite this, Khair has – since 2011 – been an operator and a de facto owner of K & S Invalid Coach, a licensed ambulance and wheelchair transportation service operating out of Clifton, New Jersey. Nearly all of K & S’ patients are Medicare beneficiaries requiring regular transportation to dialysis treatment. Since September 2011, Medicare Part B has paid more than $6 million in claims submitted by K & S. Thus far in 2014, K & S has been in the top 3 percent of the more than 400 ambulance transport providers in the state of New Jersey, as measured by receipt of payments from Medicare.
Since 2011, Khair and others at K & S have concealed his involvement at K & S from Medicare, including his substantial control over K & S’s bank accounts and operations, including the authority to hire and terminate employees, determine employee salaries, and enforce company policies. Since 2011, Khair has received more than $485,000 from K & S, and additional funds have been transferred to his wife.
After Medicare had directly deposited the money into a bank account in the name of K & S, Khair transferred money to various other accounts. In particular, on Nov. 15 2012, Khair wrote a check for $15,500 against a K & S operating account, made payable to an individual with the initials “E.A.,” endorsed by Khair, and deposited into an account in the name of E.A. Including this and other transactions from K & S operating accounts, Khair caused more than $86,000 to be transferred to that account. On Feb. 8, 2013, Khair caused a wire transfer in the amount of $86,295 to be made from the bank account in the name of E.A. for the purpose of completing a real estate transaction through which the property in which Khair resides was nominally transferred to E.A.
In filing the complaint, the United States is seeking to forfeit the property as proceeds and property involved in money laundering.
Each of the two counts with which Khair is charged carry a maximum potential penalty of 10 years in prison and a fine of $250,000, or twice the gain or loss from the offense.U.S. Attorney Fishman credited special agents of the Federal Bureau of Investigation, under the direction of Special Agent in Charge Aaron T. Ford in Newark; and HHS-OIG, under the direction of Special Agent in Charge Thomas O’Donnell, with the ongoing investigation leading to these charges.
The government is represented by Assistant U.S. Attorneys Danielle Alfonzo Walsman and Danielle M. Corcione of the U.S. Attorney’s Health Care and Government Fraud Unit, as well as Assistant U.S. Attorney Barbara Ward of the office’s Asset Forfeiture and Money Laundering Unit.
The charges and allegations contained in the complaint are merely accusations and the defendant is considered innocent unless and until proven guilty.
U.S. Attorney Fishman reorganized the health care fraud practice at the New Jersey U.S. Attorney’s Office shortly after taking office, including creating a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since 2010, the office has recovered more than $540 million in health care fraud and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Food, Drug and Cosmetic Act and other statutes.
14-362
Khair, Imadeldin Awad Complaint
Citrus Heights Man Sentenced for Child Pornography CrimeRead the Press Release
SACRAMENTO, Calif. — Jason Carlsen, 41, of Citrus Heights, was sentenced today by United States District Judge John A. Mendez to five years in prison for possession of child pornography, United States Attorney Benjamin B. Wagner announced.
According to court documents, in August 2013, Carlsen was found with hundreds of images and videos showing child pornography on his cellphone. Carlsen used file sharing programs to send and receive child pornography with others, and in May 2013, he sent a series of text messages to a recipient in Kentucky that included sexually explicit photographs of a juvenile believed to be approximately 13 years old. Carlsen has been in custody since his arrest in March 2014, and on May 13, 2014, he pleaded guilty to the possession of child pornography charge.
This case was the product of an investigation by the Federal Bureau of Investigation and the Sacramento County Sheriff’s Department. Assistant United States Attorneys Kyle Reardon and Christopher S. Hales prosecuted the case.
Charleston Women Sentenced for Defrauding Crisis MinistriesRead the Press Release
Contact Person: Rhett DeHart (843) 727-4381
Columbia, South Carolina ---- United States Attorney Bill Nettles stated today that Carol Libby, age 56, was sentenced today in federal court in Charleston, South Carolina, for Wire Fraud, a violation of 18 U.S.C. § 1343. United States District Judge Richard M. Gergel of Charleston sentenced Libby to 48 months imprisonment and 3 years supervised release.
Evidence presented at her guilty plea hearing established that Libby was the Chief Financial Officer (CFO) of Crisis Ministries, the largest homeless charity in South Carolina. From 2006-2013, Libby, a certified public accountant (CPA), embezzled more than $440,000 from the charity. To execute the fraud, Libby caused more than 400 unauthorized checks to be issued to actual vendors and suppliers of Crisis Ministries. She then forged the names of the vendors on the back of the checks and wrote her bank account number under the forged endorsements. Through a series of financial manipulations involving wire communications, Libby caused the unauthorized checks to be deposited into bank accounts over which she had control.
The case was investigated by agents of the United States Secret Service and Charleston Police Department. Assistant United States Attorney Rhett DeHart of the Charleston office prosecuted the case.Casamero Lake Man Pleads Guilty to Federal Child Sexual Abuse ChargeRead the Press Release
ALBUQUERQUE – Arthur L. Ganadonegro, 24, pleaded guilty this morning to a felony information charging him with aggravated sexual abuse of a child under the age of 12 years. Under the terms of his plea agreement, Ganadonegro will be sentenced to a federal prison term within the range of ten to 12 years followed by a term of supervised release to be determined by the court. Ganadonegro also will be required to register as a sex offender.
Ganadonegro, an enrolled member of the Navajo Nation who resides in Casamero Lake, N.M., was arrested in March 2014, on a criminal complaint alleging that he sexual abused two Acoma Pueblo children when they were less than 12 years of age. Ganadonegro subsequently was charged in a four-count indictment with two counts of aggravated sexual abuse and two counts of abusive sexual contact. The indictment alleged that Ganadonegro sexually abused one of the victims between Sept. 2013 and Nov. 2013, on the Navajo Indian Reservation in McKinley County, N.M. It further alleged that Ganadonegro sexually abused the other victim between April 2008 and Dec. 2008, in a location within Acoma Pueblo in Cibola County, N.M.
During today’s, Ganadonegro admitted that between April 2008 and Dec. 2008, he engaged in a sexual act with a child under the age of 12 years. He also acknowledged committing the crime in Acoma Pueblo.Ganadonegro has been in federal custody since his arrest. He remains detained pending his sentencing hearing, which has yet to be scheduled.
This case was investigated by the Albuquerque office of the FBI, the Laguna Agency of the BIA’s Office of Justice Services and the Pueblo of Acoma Tribal Police Department.
The case is being prosecuted by Assistant U.S. Attorney Novaline D. Wilson as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice (DOJ) to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and DOJ’s 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 exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
Canadian Promoter of Tax Fraud Scheme Sentenced to Nine Years in PrisonRead the Press Release
A Canadian tax fraud promoter who was extradited from Canada and convicted at trial was sentenced today to nine years in prison for conspiracy and three counts of wire fraud, announced Acting U.S. Attorney Annette L. Hayes. FRANZIE F. COLACO, 54, of Brampton, Ontario, Canada was convicted in July 2014 following a two-day jury trial. COLACO conspired with Ronald L. Brekke and others to promote a scheme known as “1099 OID” fraud. Under this scheme, tax filers use fraudulent Form 1099-OID forms to claim tax refunds equal to the value of the filer’s personal debt. COLACO promoted this scheme throughout Canada and encouraged Canadian citizens to request refunds from the U.S. government. U.S. District Judge John C. Coughenour found COLACO responsible for more than $6.2 million in restitution to the Internal Revenue Service, and cited the “audacious nature of the scheme,” in imposing the lengthy sentence on COLACO.
“This defendant promoted theft of U.S. tax dollars by convincing Canadians they could get rich at others’ expense,” said Acting U.S. Attorney Annette L. Hayes. “This is a fraud – pure and simple – and one that will not go unpunished.”
The IRS flagged the vast majority of the 1099 OID filings as frivolous, but refund claims totaling approximately $14 million were paid to followers of Brekke and COLACO before the IRS detected the fraudulent nature of the returns. About two-thirds of those filing for money they didn’t deserve were Canadians who had never paid any income tax in the United States and were not owed any money by the U.S. Treasury. Those submitting the phony claims were told to quickly move the money to Canada where it would be more difficult for the IRS to recover the money. COLACO personally collected over $600,000 in fraudulent refunds under the scheme.
“In all my years investigating tax crimes, this is one of the most egregious cases I have ever seen,” said Special Agent in Charge Teri Alexander of IRS Criminal Investigation. “It is unfathomable that Colaco and his co-conspirators concocted a scheme wherein their followers could extract hundreds of millions of taxpayer funds, especially when many of their adherents were not even citizens of this country and had never paid a dime of income tax.”
The IRS has been able to get just over half of the $14 million back, resulting in a restitution figure for COLACO and Brekke of $6,206,998.
Brekke, the leader of the scheme, was sentenced in June 2012 to 12 years in prison. Other defendants convicted and sentenced include Donald Mason who received a $360,000 fraudulent refund check. He unsuccessfully attempted to help his wife receive an additional $333,000. He was sentenced to 33 months in prison. John Chung received a $370,000 fraudulent refund check. He was sentenced to a year in prison. Finally, Wonita Chung helped promote the scheme, and unsuccessfully attempted to receive approximately $210,000 in funds. She was sentenced to 18 months in prison.
The IRS has more information on 1099 OID fraud here: http://www.irs.gov/uac/Newsroom/IRS-Releases-the-“Dirty-Dozen”-Tax-Scams-for-2014;-Identity-Theft,-Phone-Scams-Lead-List
.The case was investigated by the Internal Revenue Service Criminal Investigation (IRS-CI) and the United States Secret Service. The case was prosecuted by Assistant United States Attorneys Thomas Woods and Francis Franze-Nakamura.
Cambria County Man Sentenced to Probation with Home Detention, Fined for Money Laundering ConspiracyRead the Press Release
JOHNSTOWN, Pa. – On October 6, 2014, a resident of Northern Cambria, Pa., was sentenced in federal court to five years probation, the first 12 months of which must be served by conditions of home confinement, 250 hours of community service, and a $50,000 fine on his conviction of conspiracy to commit money laundering, United States Attorney David J. Hickton announced today.
United States District Judge Kim R. Gibson imposed the sentence on Robert J. Paterno, 51.
According to information presented to the court, from March 2008 to May 9, 2011, Paterno conspired to commit money laundering. In addition, evidence presented to the Court at the time of Paterno's sentencing reflected that he conspired with George M. Lowmaster and others to conduct financial transactions involving proceeds generated through Lowmaster's drug distribution organization with the intent to conceal the source of the proceeds and with the intent to promote the facilitation of Lowmaster's drug distribution organization.
Assistant United States Attorney John J. Valkovci, Jr., prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the joint task force, headed by the Laurel Highlands Resident Agency of the Federal Bureau of Investigation, for the investigation leading to the successful prosecution of Paterno. Other agencies participating on the task force include the Internal Revenue Service-Criminal Investigation, Pennsylvania State Police, Pennsylvania Attorney General's Office, Cambria County District Attorney's Office, Carrolltown Police Department, Patton Police Department, Ebensburg Police Department, Portage Police Department and Paint Township Police Department.
California Woman Charged with Kidnapping Two-Year Old Isleta Pueblo ChildRead the Press Release
ALBUQUERQUE – Janette Briones, 58, of Big Bear, Calif., made her initial appearance in the U.S. District Court for the Central District of California yesterday afternoon on a criminal complaint charging her with kidnapping a two-year old Isleta Pueblo boy and taking the young victim across state lines. A detention hearing is scheduled for Oct. 10, 2014, to determine whether Briones will be detained pending her transfer to New Mexico to face the charge against her.
According to the criminal complaint, Briones obtained permission for a brief visit with the young victim and his three-year old sister, both of whom are members and residents of Isleta Pueblo, on the evening of Oct. 2, 2014. An hour and fifteen minutes later, Briones left the three-year at the doorstep of her home in Isleta Pueblo, but allegedly drove away with the young victim. Investigation by the FBI and Isleta Pueblo Tribal Police Department revealed that Briones did not have permission to take the victim. Investigation also revealed that Briones was in the vicinity of Sugarloaf, Calif., at approximately 5:00 p.m. on Oct. 3, 2014.
The FBI arrested Briones in Big Bear, Calif., at approximately 2:00 a.m. on Oct. 4, 2014. The young victim was with Briones when she was arrested. The victim is safe and did not suffer any physical injury. He has been returned to his family in Isleta Pueblo.
If convicted of the charge in the complaint, Briones faces a penalty of imprisonment for any term of years or for life. Charges in criminal complaints are merely accusations and defendants are presumed innocent unless found guilty in a court of law.
This case was investigated by the Albuquerque office of the FBI and the Isleta Pueblo Tribal Police Department with assistance from the Victorville Resident Agency of the FBI, the San Bernardino County Sheriff’s Station in Big Bear, Calif., and the U.S. Attorney’s Office for the Central District of California. Assistant U.S. Attorney Elaine Y. Ramirez is prosecuting the case.
Buffalo Woman Sentenced for Theft of Government FundsRead the Press Release
BUFFALO, N.Y. - U.S. Attorney William J. Hochul, Jr. announced today that Candace Walker, 33, of Buffalo, N.Y., who was convicted of theft of government funds, was sentenced to two years probation before U.S. Magistrate Judge Hugh B. Scott.
Assistant U.S. Attorney Russell T. Ippolito, Jr., who handled the case, stated that Walker, a Contact Representative for the United States Department of the Treasury, Internal Revenue Service (“IRS”), collected unemployment insurance benefits for which she was not entitled. Between January 10, 2010, and October 2, 2011, the defendant fraudulently certified for unemployment insurance benefits on numerous occasions. Walker failed to report income earned from the IRS and from the Wheelchair Home, Inc., dba, Schofield Residence, in order to receive unemployment insurance benefits. In total, Manning stole $9,530 in unemployment insurance benefits from the IRS and $1,925 from the Wheelchair Home, Inc., dba, Schofield Residence.
The sentencing is the culmination of an investigation by the Department of the Treasury, Treasury Inspector General for Tax Administration (TIGTA), Office of Investigations, under the direction of Special Agent in Charge Robert E. O’Malley, the U.S. Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, under the direction of Special Agent-in-Charge Cheryl Garcia of the New York Regional Office, and the New York State Department of Labor, under the direction of Commissioner Peter Rivera.BoiseMan Sentenced for Escape from Custody and Violating Sex Offender Registration ActRead the Press Release
Fourth Conviction for Failing to Register
BOISE – Perry Lee Lewis, 37, of Boise, was sentenced today to 41 months in prison, for escaping from custody and violating the Sex Offender Registration and Notification Act, U.S. AttorneyWendy J. Olson announced. U.S. District Judge Edward J. Lodge also ordered Lewis to serve seven years of supervised release following his release from prison. Lewis pleaded guilty to the charges on May 15, 2014.
According to the plea agreement, on May 13, 2013, Lewis walked away from the Port of Hope residential reentry center in Coeur d’Alene, where he was finishing his sentence for a previous violation of the Sex Offender Registration and Notification Act. Port of Hope is a halfway house that contracts with the Federal Bureau of Prisons to help reintroduce prisoners back into the community during the last few months of their sentence. Lewis was apprehended in Worley, Idaho, on May 19, 2013, by Coeur d’Alene Tribal Police, and returned to a Federal Bureau of Prisons facility in Seattle, where he finished his sentence.
Lewis was released on July10, 2013, and returned to Boise, but once again, he failed to register as a sex offender, which resulted his arrest by the United States Marshal’s Service. Lewis was previously convicted of Rape in the Second Degree in 2006 in the state of Washington and has two previous convictions in Washington State for failing to register as a sex offender.
The United States Marshal’s Service and the Coeur d’Alene Tribal Police investigated the case. Both agencies are members of the Idaho Internet Crimes Against Children (ICAC) Task Force, a statewide coalition of local, state and federal law enforcement and prosecution agencies, focused on apprehending and prosecuting individuals who use the Internet to criminally exploit children. For more information about the Idaho ICAC Task Force and a list of all the participating agencies, visit www.icacidaho.org.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
Allentown Man Pleads Guilty to Federal Cocaine Trafficking ChargeRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a man from Allentown pleaded guilty today before Senior United States District Judge Edwin M. Kosik to the charge of conspiracy to distribute crack cocaine and powder cocaine.
According to United States Attorney Peter Smith, Jose Torres, age 25, of Allentown, Lehigh County, admitted to participating in a conspiracy to distribute cocaine in the Carbon County area between January 2011 and December 2012.
Torres is the sixth defendant to enter a guilty plea in connection with the investigation. Previously, Bonnie Vosburgh, age 22, of Nesquehoning; Victoria Argott, age 34, of Lansford; Ceres Lozada, age 27, of Nesquehoning; Alexander “Butch” Sommers, age 47, of Summit Hill, and Joseph Revell, age 21 of Nesquehoning, entered guilty pleas and admitted to participating in the same cocaine trafficking conspiracy.
The investigation was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Nesquehoning and Lansford Police Departments in Carbon County.
The case is being prosecuted by Assistant United States Attorney Robert J. O’Hara.
In this particular case, the maximum penalty under the federal statute is 40 years’ imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
****
Monday 6 October 2014
West Monroe Man Sentenced to 93 Months in Prison for Possession with Intent to Distribute MethRead the Press Release
MONROE, La. –United States Attorney Stephanie A. Finley announced today that a West Monroe man was sentenced to 93 months in prison for possessing methamphetamine that was ready to sell.
Brian T. Menzie, 52, of West Monroe, La., was sentenced by U.S. District Judge Robert G. James for one count of possession with intent to distribute methamphetamine. He was also sentenced to four years of supervised release. According to evidence presented at the July 7, 2014 guilty plea, law enforcement agents searched Menzie’s home on December 9, 2013 and found 121 net grams of methamphetamine at 86.5 percent purity inside a zip lock bag, packaged for sale. Agents also seized $3,565, a firearm, and assorted drug paraphernalia.
The DEA conducted the investigation. Assistant U.S. Attorney James G. Cowles Jr. prosecuted the case.
United States Attorney’s Office Announces Sentence in Child Sexual Exploitation CaseRead the Press Release
Indianapolis man sentenced to 336 months for exploiting local minor females.
INDIANAPOLIS – Josh J. Minkler, the Acting United States Attorney, announced today the sentencing of an Indianapolis man for sexual exploitation of children, enticing minors and distribution of child pornography. Austin Williams 23, was sentenced to 336 months (28 years) by U.S. District Judge William T. Lawrence.
“This Office initiated Operation Community Watch over two years ago with an unwavering resolve to find and prosecute those who exploit our children,” Minkler said. “You are not anonymous online and if you engage in this type of behavior, you will be held accountable.”
Court documents indicate that on January 24, 2013, Austin Williams was arrested by the Indianapolis Metropolitan Police Department and charged with the rape of a fifteen year old victim in Indianapolis. In executing a search warrant as part of their investigation, IMPD investigators searched the defendant's residence and located a cellular telephone. A search of that phone revealed hundreds of sexually explicit images depicting female minors.
A full forensic examination of the phone revealed that Williams had been engaging in a pattern of "sextortion" that targeted young women in the Indianapolis-area. Using fraudulent Facebook accounts that portrayed Williams as a young woman, the defendant would make contact with local female minors and attempt to elicit sexually explicit images from them by offering to "trade" self-made images. Often, Williams would obtain the telephone number of his victims, urging them via text messages to produce explicit images and videos of themselves.
Once these images or videos were produced and sent to the defendant, he would in many instances begin "sextorting" the minors, posting the images on Facebook or threatening to do so. The victims would then be told that the only way to keep these images from being distributed to their friends and family would be through the creation of new images and videos for the defendant.
Through the use of these techniques, the defendant was able in many instances to coerce his victims into repeatedly exploiting themselves. In one troubling incident, the defendant continued to post images of a victim online even after she complied with the defendant's requests. The victim was so distraught that she attempted suicide.
In addition, a number of victims were tricked into meeting up with the defendant, who they were told was a "brother" or "boyfriend" of the young woman they believed they were communicating with online. During these meetings, Williams would attempt to sexually assault the victims, or would actually engage in illicit sexual activity with them. In the case of his final victim, the government argued that Williams followed a fifteen year old female home after one of these arranged meetings and assaulted her outside her home.
According to Senior Litigation Counsel Steve DeBrota and Trial Attorney Amy Larson of the DOJ Child Exploitation and Obscenity Section, who prosecuted this case for the government, Williams faces lifetime supervised release when he completes his prison term.
This case was brought as part of Project Safe Childhood (PSC), a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. The greatest measure of the PSC program’s impact is the identification and rescue of child victims of sexual exploitation and abuse.
Led nationally 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.
UA Law School Students Work with Alabama Board of Pardons and Paroles and U.S. Attorney to Assist Ex-OffendersRead the Press Release
TUSCALOOSA – The Public Interest Law Institute of the University of Alabama School of Law is beginning a monthly legal service project to assist individuals under the supervision of the Tuscaloosa office of the Alabama Board of Pardons and Paroles.
Law students will hold the first legal clinic on Tuesday. The students will compile intake reports and send them to volunteer lawyers and local community service programs. Issues most likely to be addressed include child support, identification, employment assistance and housing.
Annually, more than 3,000 Alabamians on community supervision fail to successfully reenter society after being released from prison. People who violate conditions of probation or parole comprise 40 percent of the Alabama Department of Corrections' annual admissions.
Cynthia Dillard, executive director of the Alabama Board of Pardons and Paroles stated, “The Board of Pardons and Paroles is excited about this opportunity to partner with University of Alabama Law School volunteers to assist offenders with addressing some of the significant barriers to successful supervision and reentry. This program will serve as a model for other jurisdictions in Alabama with similar resources.”
Ex-offenders reentering society routinely encounter barriers to accessing housing, education, employment, healthcare, transportation, and community support services. Ninety-five percent of Alabama’s 30,000 inmates will eventually be released into communities.
Since 2010, U.S. Attorney Joyce White Vance and the North Alabama Reentry Council have been working with federal, state and community agencies to improve reentry outcomes for ex-offenders within Alabama. The council has focused on identifying both barriers to reentry and resources available to ex-offenders, and addressing gaps in services.
“We have to be smart on crime as well as tough on crime," Vance said. "Providing the guidance ex-offenders need to return to productive lives will make our communities safer and help reduce the high rate of overcrowding in our prisons that is stressing state budgets. The Tuscaloosa clinic will help ex-offenders overcome barriers to reentry, for instance helping them regain their driver’s licenses so they can get a job," she said. "This is the essence of being smart about how our criminal justice system can work.”
If you have questions about the legal clinic, or if you believe your organization has expertise or resources that could improve outcomes for ex-offenders re-entering society, please e-mail the U.S. Attorney’s Office community outreach coordinator at [email protected], or call 205-244-2019.
- U.S. Seeks Death Penalty in USPS Worker Murder Case
U.S. Attorney’s Office Seeks to Identify Victims in Cases Involving Kentwood PharmacyRead the Press Release
GRAND RAPIDS, MICHIGAN – The U.S. Attorney’s Office in the Western District of Michigan is handling criminal cases involving various individuals in connection with their employment at Kentwood Pharmacy. Kentwood Pharmacy serviced nursing homes, adult foster care homes, and other long term care facilities until November of 2010. Kentwood Pharmacy also operated retail pharmacies in Grand Rapids (formerly Eastgate Pharmacy), Shepard, Alma, and St. Louis, Michigan.
To date, multiple individuals have pled guilty to criminal offenses relating to their employment at Kentwood Pharmacy. Individual patients may have received drugs from Kentwood Pharmacy as early as 2004 that were misbranded or adulterated. Examples of such misbranded or adulterated drugs include mislabeled drugs, discolored drugs, or expired drugs. Persons who believe that they were victims of this crime by receiving or paying for drugs supplied by Kentwood Pharmacy between 2004 and November 2010, which were misbranded or adulterated may be afforded rights under the federal Crime Victims’ Rights Act including notification of court proceedings and the opportunity to submit a victim impact statement and be heard at public court proceedings.
If you believe that you are a victim of this crime, please notify the Victim Witness Unit at the United States Attorney’s Office. You may do this by clicking on Link to Victim Information Form at the website for the United States Attorney’s Office for the Western District of Michigan at http://www.justice.gov/usao/miw/programs/victimwitness.html If you are unable to access the website, you may call the Victim Witness Unit at (616) 808-2034 and they will take the information over the phone.
END
Two Michigan Men Sentenced to Prison for Filing False Claims Against Internal Revenue ServiceRead the Press Release
Two Detroit area men were sentenced today in the U.S. District Court for the Eastern District of Michigan for conspiracy and filing $3.4 million in false claims against the Internal Revenue Service (IRS), the Justice Department and IRS announced.
Jason McGuire, 38, of Detroit, was sentenced to serve 63 months in prison to be followed by three years of supervised release and to pay $1.675 million in restitution. Delvin Davis, 37, of Saint Clair Shores, Michigan, was sentenced to serve 42 months in prison to be followed by three years of supervised release and to pay $1.146 million in restitution.
On Jan. 30, McGuire and Davis were found guilty by a jury in Detroit of conspiracy to file false claims in the form of false individual income tax returns and false trust tax returns. The defendants were also found guilty of filing or aiding and abetting in the filing of false, fictitious and fraudulent claims; McGuire was found guilty of 18 such counts and Davis was found guilty of five counts. Witness testimony revealed that the defendants attended the same high school in Detroit and started the scheme in 2008. Prior to that time, McGuire had worked as a mechanic and Davis had worked as a mortgage broker and operated a credit repair business.
According to court documents and evidence introduced at trial, McGuire and Davis recruited individuals from the Detroit area with whom they had existing, long-standing business and personal relationships to sign fraudulent trust and income tax returns. McGuire had the taxpayers sign blank trust return forms, and the taxpayers never saw the filled-out forms before they were filed. McGuire attached bogus forms to the income tax returns. McGuire included fictitious withholdings in both types of return forms which resulted in the taxpayers receiving large refunds. The defendants recruited at least nine different taxpayers to participate in the fraudulent scheme. The IRS received returns requesting more than $3.4 million in false refunds and paid more than $1.5 million in false refunds as a result of the fraudulent scheme. Several taxpayers testified at trial that they were required to pay fines and interest to the IRS as a result of the false tax returns that the defendants submitted.
This case was investigated by special agents from IRS – Criminal Investigation and prosecuted by Assistant U.S. Attorney Elizabeth Stafford for the Eastern District of Michigan and Trial Attorney Mark McDonald of the Tax Division.
Additional information about the Tax Division and its enforcement efforts may be found on the division website.
Tulare County Resident Pleads Guilty to Marijuana Cultivation OperationRead the Press Release
FRESNO, Calif. — Baltazar Rodriguez, 45, of Terra Bella, pleaded guilty today to conspiring to manufacture, distribute and possess with intent to distribute marijuana grown on property where he resided, U.S. Attorney Benjamin B. Wagner announced.
In pleading guilty, Rodriguez also acknowledged that he possessed a firearm in connection with the conspiracy. According to court records, law enforcement officers seized over 1,000 marijuana plants from 39.6 acres of farm land in Terra Bella where Baltazar Rodriguez resided with his family. Inside the Rodriguez residence, officers found a loaded, unregistered revolver in his bedroom, a digital scale commonly used to weigh controlled substances, and documents showing wire transfers of cash to Mexico. Rodriguez’s guilty plea follows the convictions and sentencing of the other five defendants.
Baltazar Rodriguez is scheduled for sentencing on December 15, 2014. He faces up to 20 years in prison and a $1 million fine. The actual sentence will be determined at the discretion of the court after consideration of any applicable statutory sentencing factors and the Federal Sentencing Guidelines, which take into account a number of variables.
This case is the product of an investigation by the U.S. Forest Service, the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the U.S. Drug Enforcement Administration, the Sheriff’s offices of Tulare, Kern, Ventura, and San Luis Obispo Counties, and the Escondido Police Department. Assistant United States Attorney Karen Escobar is prosecuting the case.
Topeka Man Sentenced to Federal Prison for Bank Fraud in Junction City Apartment DealRead the Press Release
TOPEKA, KAN. - A Topeka man was sentenced Monday to 57 months in federal prison after he pleaded guilty to federal bank fraud charges in connection with a plan to build an apartment complex in Junction City, U.S. Attorney Barry Grissom said today.
John Wyatt Duncan, Jr., 53, Topeka, Kan., pleaded guilty to two counts of bank fraud, one count of money laundering and one count of making false statements in documents required by the Employee Retirement Income Security Act (ERISA).
In court documents, Duncan was alleged to have obtained a $15.2 million construction loan for the purpose of constructing Quinton Pointe Apartments in Junction City. He was required to provide $1,225,000 in collateral. He signed a letter to the lender, University National Bank of Lawrence, Kan., falsely stating that lumber for the construction of the apartment complex, representing collateral for the loan, was prepaid in full and being held by Schmidt Builders, a company for which he was chief executive officer. He instructed employees of Schmidt Builders to create a false invoice in an amount of more than $1.3 million to a company he owned called Blue Jay Properties LLC in order to create the false appearance that Blue Jay Properties had prepaid Schmidt Builders for the lumber.
In another count, Schmidt Builders acquired a $12 million line of credit loan from Kaw Valley National Bank of Topeka and agreed to provide the bank with monthly financial reports. Duncan submitted reports to the bank containing false information about the age of certain accounts receivable and the amount of inventory on hand.
Grissom commended the Internal Revenue Service, Criminal Investigations Division; the Federal Deposit Insurance Corporation, Office of Inspector General; the Federal Reserve Board, Office of Inspector General; the U.S. Department of Labor, Assistant U.S. Attorney Duston Slinkard and Assistant U.S. Attorney Jabari Wamble for their work on the case.Three Indicted in Prescription Drug Smuggling RingRead the Press Release
The Department of Justice announced today that three Athens, Texas, residents have been indicted on charges associated with their alleged smuggling of imitation, unapproved, and misbranded prescription drugs from China.
Wanda Hollis, 63, Tom Giddens, 57, and Catherine Nix, 41, were each charged with one felony count of conspiracy to smuggle merchandise into the United States, seven counts of causing the introduction of misbranded drugs into interstate commerce with the intent to defraud or mislead, seven counts of smuggling and one count of tampering with a witness. Giddens was also charged with two additional counts of tampering and Nix was charged with one additional tampering count. The defendants were also charged with misdemeanor counts of causing misbranded imitation drugs to be introduced into interstate commerce. Nix was arrested on October 2 in Athens. Giddens and Hollis surrendered this morning.
According to the indictment, the defendants conspired to smuggle at least 30 known shipments, totaling approximately 100,000 pills, from China to Texas. As alleged in the indictment, the shipments contained bogus imitations of Xanax, Valium, sibutramine, Cialis, Viagra and Stilnox, which is marketed in the United States as Ambien. None of the pills seized and tested were legitimate, and all either contained incorrect active ingredients or were sub-potent. The defendants also attempted to conceal their smuggling by using shipping labels that concealed the contents of their shipments, including customs declarations falsely describing the contents as “gifts” or “toys” with low declared monetary values, and by using multiple addresses in an effort to reduce the likelihood of seizures by U.S. Customs authorities. Additionally, the indictment states that the defendants instructed family members to destroy evidence once they became aware that the U.S. Food and Drug Administration (FDA) was investigating them.
“The smuggling and sale of counterfeit prescription drugs puts the public's health and safety at risk,” said Acting Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division. “Consumers should know that the drugs they are buying are what they purported to be and not misbranded to look like name-brand products that could ultimately do them more harm than good.”
“A key element of FDA’s mission to protect the public’s health is to ensure that safe and effective prescription drugs are properly distributed via the supply chain and dispensed to the ultimate consumer, and that includes ensuring that those prescription drugs contain the treatments that patients expect,” said Acting Director Philip J. Walsky of the FDA’s Office of Criminal Investigations. “We will continue to pursue and bring to justice those who would put the public’s health at risk by introducing illegal prescription drugs.”
This case was investigated by the FDA’s Office of Criminal Investigations and U.S. Immigration and Customs Enforcement-Homeland Security Investigations. The case is being prosecuted by Trial Attorney John W.M. Claud of the Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney Allen Hurst for the U.S. Attorney’s Office for the Eastern District of Texas.
Charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
Tacoma Man Sentenced to Nearly Four Years in Prison for Falsely Claiming $1.8 Million in Income Tax RefundsRead the Press Release
A Tacoma, Washington man who claimed more than $1.8 million in false income tax refunds was sentenced today in U.S. District Court in Tacoma to 46 months in prison, announced Acting U.S. Attorney Annette L. Hayes. SEENEY RISTICK, 33, pleaded guilty in June 2014. At sentencing U.S. District Judge Benjamin H. Settle noted that the dollars stolen were paid into the system by hard-working tax payers and intended to support all the things that the government does. Because of RISTICK’s actions that did not occur.
According to the plea agreement, between 2008 and 2013, RISTICK presented various fraudulent papers and forms to different tax preparation firms in Western Washington and directed the filing of bogus tax returns in his own name and the names of others, to include relatives and friends. To facilitate the scheme, RISTICK created false income journals and falsely claimed self-employment income and various tax credits, all with the intent to defraud the Internal Revenue Service. RISTICK typically approached the tax preparers by himself and presented fraudulent, and sometimes forged, powers of attorney, which purported to allow RISTICK to represent the named tax-filer in financial matters. At other times, he would accompany individuals to the tax preparation firms and assist them in filing the false tax return. RISTICK then charged the person for filing the false tax return between $500 and $1500 for the service he provided.
In all, RISTICK was involved in filing 524 fraudulent federal income tax returns, claiming a total of $1,826,944 in refunds. The U.S. Treasury paid out $1,584,398 before the fraud was uncovered. None of the money has been repaid.
“We want every American taxpayer to claim every entitlement, deduction, and credit that they are lawfully due,” said Special Agent in Charge Teri Alexander of IRS Criminal Investigations. “However, when someone like Ristick undertakes to submit false returns claiming undue refunds, they effectively steal from those paying their honest share. IRS Criminal Investigation will tirelessly pursue those who would claim false refunds thereby undermine the tax system.”
The case was investigated by the Internal Revenue Service Criminal Investigation (IRS-CI). The case was prosecuted by Assistant United States Attorney Steven Masada.
Soldier Pleads Guilty to Theft of over $400,000 Worth of FuelRead the Press Release
GREENVILLE – United States Attorney Thomas G. Walker announced that today in federal court, before United States Magistrate Judge Kimberly A. Swank, ALEXANDER SWIM , 25, of Fort Bragg, North Carolina, entered a guilty plea to the theft of fuel from Forward Operating Base (FOB) Sharana, Afghanistan in violation of Title 18, United States Code, Sections 641 and 2.
According to information in the public record, ALEXANDER SWIM is a Specialist (E-4) in the United States Army assigned to the 3rd Special Forces Group. From January 2012 through October 4, 2012, SWIM was assigned to an Advanced Operating Base (AOB) deployed to Afghanistan under the Combined Joint Special Operations Task Force (CJSOTF) - Afghanistan assigned under the Special Operations Task Force (SOTF)-East, also known as Task Force 23, and assigned to the Forward Operating Base ("FOB") Sharana. During his deployment to Afghanistan, SWIM served as an AOB Mechanic with duties to work at FOB Sharana's fuel point and to perform maintenance on military vehicles.
During his deployment, SWIM and others engaged in a fuel theft scheme. Specifically, SWIM worked with another U.S. soldier (James Edward Travis who was previously indicted), to steal fuel belonging to the United States Government from the fuel point at FOB Sharana. On multiple occasions, SWIM was paid to escort a foreign national driver to the fuel point on FOB Sharana, to load fuel belonging to the United States into such driver's truck, and to escort the driver with the stolen fuel back off FOB Sharana.
Agents determined that 182,815 gallons of fuel were stolen. Based on an average price of $2.31/gallon for JP-8 fuel, the loss from the fuel theft scheme to the government is estimated at $422,302.65
"Defense Criminal Investigative Service (DCIS) Special Agent in Charge John F. Khin, Southeast Field Office, commented, "It is disheartening when a military member abandons his code of conduct and steals from his own unit for personal enrichment, especially when it undermines the combat mission. DCIS will continue to aggressively investigate violators to protect Department of Defense resources around the world, and preserve precious American taxpayer dollars."
"Specialist Alexander Swim, US Army, 3rd Special Forces Group, betrayed his unit, the US Army and the nation for personal profit. Swim with his co-conspirators entered into illegal relationships in order to personally profit from the sale and transport of fuel valued at over $400,000. These actions, especially in a war time environment, damage the reputation of all soldiers and impede the success of coalition war efforts. Those involved in this type of criminal activity will be aggressively pursued by the FBI and our military partners dedicated to upholding justice," said John Strong, Special Agent in Charge of the FBI in North Carolina.
"Today's plea is a prime example of our continued and relentless commitment to investigate and hold accountable all those who would commit fraud against the U.S. Army, especially those in uniform and during a time of war," said Frank Robey, Director of the U.S. Army Criminal Investigation Command's Major Procurement Fraud Unit. "The Army's Criminal Investigation Command continues to work round the clock in cooperation with our inter-agency law enforcement partners in theaters around the world to protect Army and National interests."
The maximum penalty that SWIM faces at sentencing is 10 years imprisonment and/or a $250,00 fine, restitution and forfeiture in the amount of $15,000.
The criminal investigation of this case was conducted by Defense Criminal Investigative Service, the Federal Bureau of Investigation, the United States Army Criminal Investigation Command, and the Office of the Special Inspector General for Afghanistan Reconstruction (SIGAR). Assistant United States Attorney Banumathi Rangarajan is handling the prosecution of the case.