Latest Records
Newest first across public DOJ and U.S. Attorney press releases.
Thursday 2 October 2014
Rutland Woman Faces Federal Charges for Crack Cocaine DistributionRead the Press Release
The Office of the United States Attorney for the District of Vermont stated that Qiana Govan (a.k.a. “Missy”), 25, of Rutland, Vermont, and formerly of Brooklyn, New York, has been charged by Indictment with three counts of distributing crack cocaine in Rutland, Vermont in May 2014. Govan pled not guilty before U.S. Magistrate Judge John Conroy and was released on conditions pending trial as she has no prior criminal record.
The United States Attorney emphasizes that the charges contained in the Indictment are merely accusations and that the defendant is presumed innocent unless and until she is proven guilty. If Govan is convicted, she faces a maximum possible term of imprisonment of twenty years.
The United States is represented in this matter by Assistant U.S. Attorney Joseph Perella. Govan is represented by Karen Shingler, Esq. The investigation was conducted by the Vermont State Police Drug Task Force, the Federal Bureau of Investigation, and the Drug Enforcement Administration.
Rock Island Man Sentenced to Life in Prison for Two Armed Bank RobberiesRead the Press Release
Rock Island, Ill. –Deangelo Dixon, 28, of Rock Island, Ill., was sentenced to life in prison without the possibility of parole for committing two armed bank robberies, as announced by U.S. Attorney Jim Lewis, Central District of Illinois. A jury convicted Dixon in March 2014, for the violent armed robberies of Union Federal Savings & Loan in Viola, Ill., and the 1st Community Bank in Sherrard, Ill. Today, U.S. District Judge Sara L. Darrow found, based on Dixon’s two prior robbery convictions in Illinois courts, that Dixon was a recidivist violent offender as defined in the federal 3-Strikes law, and accordingly, a term of life imprisonment was mandated.
At pre-trial hearings and at trial, the government presented evidence that when Dixon entered Union Federal Savings & Loan in Viola, on Nov. 8, 2012, he had been on parole for fewer than two weeks from the Illinois Department of Corrections for aggravated robbery. When Dixon entered the bank, he was dressed in black and his head was covered with a mask. He grabbed a teller by the collar, put a round hard object against her neck, demanded money, and threatened to shoot the teller. Dixon made continuous threats to force tellers to open the bank vault and took $30,994 before fleeing.
The government presented further evidence that on Dec. 10, 2012, Dixon entered the 1st Community Bank in Sherrard, again dressed in black and wearing a mask. He pointed a firearm-like object, which was later determined to be a butane lighter, at tellers, announcing that he wanted money or he would shoot. While yelling continuous threats, Dixon grabbed a teller and forced her to remove $5,710 from teller drawers. As Dixon fled the bank and approached his getaway car, he encountered another teller who had run from the bank as the robbery was underway. Dixon grabbed the teller, tried to force her into his car, and when he was unsuccessful, punched her in the face.
Evidence further established that a Rock Island police officer, who had investigated Dixon in connection with his prior robbery offenses, recognized Dixon’s signature robbery technique and his car after seeing a bulletin circulated by the FBI and police to area law enforcement agencies. FBI agents, police officers, and parole officers of the Illinois Department of Corrections subsequently recovered physical evidence, including clothing and the car, linking Dixon to both robberies. Evidence was also presented that Dixon, unemployed and recently released from prison, spent large sums of money after the robberies.
Assistant U.S. Attorneys Don Allegro and Kirk Schuler prosecuted the case. The charges were investigated by the Federal Bureau of Investigation, the Mercer County Sheriff’s Office, the Viola Police Department, the Rock Island Police Department, and the Illinois Department of Corrections.
# # # #Portland Man, Former Senior Vice President at DAT Solutions Sentenced for Defrauding his own Company out of $1.4 MillionRead the Press Release
PORTLAND, Ore. – David Schrader, 47, of Portland, Oregon, was sentenced yesterday by U.S. District Court Judge Robert E. Jones to 46 months in prison followed by three years of supervised release for the crime of wire fraud. He was also ordered to pay over $1.4 million in restitution to DAT Solutions (formerly Transcore), the victim of his crime, as well as a sizeable money judgment to the government as punishment for his crime. Schrader pleaded guilty to the crime of wire fraud in June of this year.
Between 2003 and 2014, Schrader stole more than $1.4 million from the company while employed as the Senior Vice President of Operations. At the time the company discovered his theft in early 2014, Schrader was one of the highest paid employees at DAT, earning close to half a million dollars in salary and benefits. Schrader accomplished his theft by submitting false expense reports to DAT’s accounting department that either falsified or inflated the amounts for which defendant was actually entitled to receive reimbursement. As part of his fraud, Schrader forged the signature of DAT’s president, fabricated approval emails from the president on his fraudulent reports, and submitted false credit card statements.
Tim Bickmore, the former president of DAT Solutions, testified at the sentencing hearing about the toll that Schrader’s fraud had taken on the company. During many of the years that Schrader’s fraud went undetected, DAT Solutions was dealing with the consequences of the recession affecting all U.S. companies. As a result of the combination of the recession and the significant theft by Schrader, DAT was forced to lay off multiple employees and make adjustments to the salaries and bonuses of other employees, many within the state Oregon, Mr. Bickmore told Judge Jones. David Liner, general counsel for DAT Solutions, also testified at the sentencing, and estimated that the actual loss to DAT’s shareholders—which included employee retirement funds—exceeded $22 million. When handing down Mr. Schrader’s sentence of 46 months in prison, Judge Jones told the defendant that when he was called a crook, a liar, a cheat, and a forger by his former colleagues, he had “earned each of those titles.”
The investigation of this case was conducted by the FBI, and the case was prosecuted by Assistant U.S. Attorneys Michelle Kerin and Katie Lorenz.
Portland Gang Associate Sentenced to 94 Months in Prison after being convicted of unlawfully possessing ammunitionRead the Press Release
The case arose from a shooting where the police were unable to recover a firearmPORTLAND, Ore. – October 2, 2014, Thomas Douglas Smith, 35, of Portland, Oregon, was sentenced to 94 months’ imprisonment after his federal conviction for being a felon in possession of ammunition. When the defendant is released from prison he will serve an additional three years of supervised release.
The defendant’s conviction stemmed from a gang involved shooting in which two people were shot, yet failed to cooperate with law enforcement. On May 22, 2011, the defendant was implicated in shooting two individuals inside the Interstate Bar and Grill in north Portland, Oregon. The shooting stemmed from an initial physical altercation between the defendant and two rival gang members. DNA evidence and video surveillance from inside the bar indicated that the defendant, after being punched by two other individuals, pulled out a gun and started shooting. Two individuals were shot but they would not cooperate with either the police or the District Attorney’s Office. No firearm was recovered from the scene. While investigating the shooting, Portland Police Bureau (PPB) Detectives and Officers with the Gang Enforcement Team recovered two spent .380 caliber shell casings and two fired .380 caliber bullets.
After extensive follow-up work by the PPB Gang Enforcement Team and the Bureau of Alcohol, Tobacco, Firearms and Explosives, on March 21, 2012, the defendant, a felon, was indicted in federal court for being a felon in possession of ammunition that had traveled in interstate commerce. At the time of the crime, the defendant had prior felony convictions for Escape in the Second Degree, Possession of a Controlled Substance, Burglary in the First Degree, Felony Assault in the Fourth Degree, Delivery of a Controlled Substance, and Delivery of a Controlled Substance within 1,000 feet of a School. The defendant pled guilty to the charge on October 30, 2012. The defendant had been released from state prison less than three months prior to the shooting.
This case was investigated by the Portland Police Bureau’s Gang Enforcement Team and the Bureau of Alcohol, Tobacco, Firearms and Explosives. The case was prosecuted by Assistant U. S. Attorneys Scott Kerin and Stacie Beckerman, both members of the U.S. Attorney’s Office Gang and Sex Trafficking Prosecution Team.
Port Arthur Woman Charged in SYAM Tax Service SchemeRead the Press Release
Department of Justice
Office of Public AffairsBEAUMONT, Texas – A 61-year-old Port Arthur, Texas woman has been charged for her role in the SYAM Tax Service Scheme in the Eastern district of Texas, announced U.S. Attorney John M. Bales today.
Diana Broussard McCoy was indicted on Oct. 1, 2014 by a federal grand jury charging her with conspiracy to commit wire fraud.
McCoy joins Shannon Tecoko Mays, 36, of Dallas, who was previously indicted on Feb. 5, 2014, for conspiracy to commit wire fraud. Mays is currently scheduled for trial on Dec. 8, 2014, before U.S. District Judge Ron Clark.
According to prosecutors, an investigation began in August 2012 in response to numerous complaints to state and federal authorities from citizens in Port Arthur, Anahuac, Nacogdoches and Lufkin, Texas regarding income tax returns that were being fraudulently prepared on their behalf. During the investigation, it was discovered that Mays was operating numerous offices across the United States under the name “Syam Tax Services, L.L.C.” and “Baby Momma Tax.” Although the principal office was located in Dallas, Mays also operated or sought to operate satellite offices in numerous other locations, including Fort Worth, Houston, New Orleans, Memphis, Atlanta, Chicago and Los Angeles.
The indictment alleges that Mays employed McCoy as a “recruiter” for Southeast Texas, paying her between $50-100 for every client she successfully brought into Syam Tax. Mays targeted individuals who were generally exempt from having to file income tax returns because they would be less likely to discover a fraudulent tax return had been filed on their behalf. In order to avoid detection, Mays altered the taxpayer’s address and phone numbers on the returns so that any phone calls or correspondence from the IRS would not reach the taxpayer. The scheme also used electronic deposits to ensure paper checks would not be mailed to the taxpayer.
On Aug. 22, 2012, Port Arthur Police and federal investigators executed a search warrant on McCoy’s residence in Port Arthur. Officers recovered numerous boxes of documents that contained the personal information of Port Arthur residents and had previously been faxed to Syam’s Houston office.
For the tax year 2011, Syam Tax filed 4,226 tax returns claiming approximately $3,150,406. If convicted, McCoy faces up to 20 years in federal prison.This case is being investigated by Internal Revenue Service – Criminal Investigation, Federal Bureau of Investigation, the Port Arthur Police Department, the Texas Attorney General’s Office – Consumer Protection Division, and the Treasury Inspector General for Tax Administration. This case is being prosecuted by Assistant U.S. Attorney Baylor Wortham.
It is important to note that a grand jury indictment is not evidence of guilt.
Owner of La Habra Manufacturing Firm Charged with Illegally Manufacturing and Selling Key Component for AR-15-Type RiflesRead the Press Release
LOS ANGELES – A federal grand jury today indicted the owner of an Orange County manufacturing business on a federal charge related to the illegal manufacture and sale of lower receivers for AR-15-type rifles, as well as completed firearms.
The one-count indictment charges Joseph Roh with engaging in the business of manufacturing and dealing in firearms without a license, a felony offense that carries a statutory maximum penalty of five years in federal prison and a $250,000 fine.
The indictment alleges that Roh, 46, of Fullerton, did not have the proper license, but he manufactured and sold hundreds of lower receivers for AR-15-type firearms. In addition to the lower receivers, the indictment alleges that Roh illegally sold complete rifles and pistols.
Through his business, ROHG Industries in La Habra, Roh allegedly started with unfinished lower receivers for AR-15-style firearms. A lower receiver is the frame of a completed firearm that holds the trigger and hammer. An unfinished lower receiver, when machined further, constitutes a firearm. Roh and his employees would finish the lower receivers by machining the devices with a computer-numerically-controlled – or CNC – machine and drill presses that Roh maintained at the La Habra warehouse.
Roh attempted to avoid the licensing requirement by requiring that each customer play a token role in the manufacturing process, which often meant merely pushing a button on a CNC machine, while company employees did the vast majority of the work.
While the sale of unfinished lower receivers is not regulated, the manufacture and sale of completed lower receivers – which are considered firearms under federal law – requires a proper license.
Additionally, Roh would, if the customer wanted, assemble the rest of the firearm by adding an upper receiver, a barrel, and other necessary parts to the lower receiver.
Roh has agreed to surrender tomorrow and be arraigned on the indictment tomorrow afternoon in United States District Court.Release No. 14-133
Operation Left Overs: All 17 Convicted in Drug Trafficking OperationRead the Press Release
BATON ROUGE, LA - United States Attorney Walt Green announced today the conviction of the final defendant in Operation Left Overs, a long-running series of prosecutions aimed at dismantling a drug trafficking network in the Baton Rouge area.
HENRY BROWN, a.k.a. Cat, of Baton Rouge, Louisiana, pled guilty this morning before U.S. District Judge James J. Brady to conspiring with others to distribute over 500 grams of cocaine. He was one of 17 defendants who were federally prosecuted in this operation. With today’s guilty plea, all 17 defendants have been convicted.
The other defendants include Barry Cushenberry, Travis Newman, Tyrone Smith, John Sullivan, Coda Stovall, Patrick Scott, Marlon Thompson, Gregory McGee, Jonathan Wright, Demond Spurlock, Dwight K. Wright, Jr., Renan Gilkes, Charleston Jackson, Joseph Morrison, Dwayne Richardson, and Clarence Nero.
The investigation is another effort by the Organized Crime Drug Enforcement Task Force (OCDETF) Program which was established in 1982 to mount a comprehensive attack against organized drug traffickers. Today, the OCDETF Program is the centerpiece of the United States Attorney General’s drug strategy to reduce the availability of drugs by disrupting and dismantling major drug trafficking organizations and money laundering organizations and related criminal enterprises. The OCDETF Program operates nationwide and combines the resources and unique expertise of numerous federal, state, and local agencies in a coordinated attack against major drug trafficking and money laundering organizations.
The operation was handled by U.S. Attorney’s Office, the U.S. Drug Enforcement Administration, and the Baton Rouge City Police Department, with assistance from the East Baton Rouge Sheriff’s Office, the Livingston Parish Sheriff’s Office, the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the West Baton Rouge Parish Sheriff’s Office, the Ascension Parish Sheriff’s Office, the Gonzales Police Department, the Louisiana State Police, and the U.S. Marshals Service. These matters were prosecuted by Assistant United States Attorneys Susan Amundson, Cam Le, and Joe Blackwell.
Operation I Spy: Prosecution Against Drug Organization ExpandsRead the Press Release
BATON ROUGE, LA - United States Attorney Walt Green announced today the unsealing of another federal grand jury indictment in Operation I Spy, an extensive investigation into a drug trafficking network operating in the Baton Rouge region.
Today’s indictment adds another defendant to the ongoing prosecutions, resulting in a total of 11 defendants. CASEY BASS, age 31, of Ponchatoula, Louisiana, is now charged with conspiracy to distribute and possess with the intent to distribute cocaine and cocaine base; possession with the intent to distribute cocaine and cocaine base; and forfeiture. If convicted, he faces a mandatory minimum of five years in prison.
The other ten defendants who were previously indicted are:
• Ronrico Terrell, Sr., also known as “Ronrico Howard,” “Co,” “Shorty,” and “Rico,” age 38, of Baton Rouge, Louisiana, was charged with conspiracy to distribute and possess with the intent to distribute cocaine and cocaine base; distribution of cocaine; possession with the intent to distribute cocaine and cocaine base; unlawful use of a communications facility; possession of a firearm in furtherance of a drug trafficking crime; and forfeiture.
• Rahkeyah Howard, also known as “Boo,” age 33, of Baton Rouge, Louisiana, was charged with conspiracy to distribute and possess with the intent to distribute cocaine and cocaine base; distribution of cocaine; possession of a firearm in furtherance of a drug trafficking crime; and forfeiture.
• Howard S. Golphin, age 35, of Pine Grove, Louisiana, was charged with conspiracy to distribute and possess with the intent to distribute cocaine and cocaine base; possession with the intent to distribute cocaine and cocaine base; unlawful use of a communications facility; and forfeiture.
• Danniesa Hughes Sanders, age 35, of Pine Grove, Louisiana, was charged with conspiracy to distribute and possess with the intent to distribute cocaine and cocaine base; possession with the intent to distribute cocaine and cocaine base; and forfeiture.
• Johntha Rochon Williams, age 32, of Baton Rouge, Louisiana, was charged with distribution of cocaine and cocaine base and forfeiture.
• Bristen LaCour, also known as “Rudy,” age 24, of Baton Rouge, Louisiana, was charged with conspiracy to distribute cocaine base, distribution of cocaine base, and forfeiture. She has since been convicted.
• Troy A. Bell, age 25, of Baton Rouge, Louisiana, was charged with conspiracy to distribute cocaine base, distribution of cocaine base, and forfeiture. He has since been convicted.
• Michael C. Finley, age 43, of Baton Rouge, Louisiana, was charged with distribution of cocaine base and cocaine and forfeiture. He has since been convicted.
• Eric O’Neal Selders, age 42, of Baton Rouge, Louisiana, was charged with conspiracy to distribute and possess with the intent to distribute cocaine, possession with the intent to distribute cocaine, and forfeiture. He has since been convicted.
• Gerard Lathan Smith, age 40, of Baton Rouge, Louisiana, was charged with possession with the intent to distribute 500 grams or more of cocaine and forfeiture.
The investigation is another effort by the Organized Crime Drug Enforcement Task Force (OCDETF) Program which was established in 1982 to mount a comprehensive attack against organized drug traffickers. Today, the OCDETF Program is the centerpiece of the United States Attorney General’s drug strategy to reduce the availability of drugs by disrupting and dismantling major drug trafficking organizations and money laundering organizations and related criminal enterprises. The OCDETF Program operates nationwide and combines the resources and unique expertise of numerous federal, state, and local agencies in a coordinated attack against major drug trafficking and money laundering organizations.
This operation is being handled by the U.S. Attorney’s Office, the U.S. Drug Enforcement Administration, and the Baton Rouge City Police Department, with assistance from the East Baton Rouge Sheriff’s Office, the Livingston Parish Sheriff’s Office, the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the West Baton Rouge Parish Sheriff’s Office, the Ascension Parish Sheriff’s Office, the Gonzales Police Department, the Louisiana State Police, and the U.S. Marshals Service. These matters are being prosecuted by Assistant United States Attorney Cam Le.
NOTE: An indictment is an accusation by the Grand Jury. The defendants are presumed innocent until and unless adjudicated guilty at trial or through guilty pleas.
Norwalk Man and Two Others Arrested in Heroin StingRead the Press Release
Follow @USAO_CT
Deirdre M. Daly, United States Attorney for the District of Connecticut, and Michael J. Ferguson, Acting Special Agent in Charge of the Drug Enforcement Administration for New England, today announced the arrests of OMAR ANDRADE, 29, of Norwalk; and JOEL A. ESTRELLA-DISLA, 24, and WILMER ANTONIO GOMEZ-RODRIGUEZ, 28, both of New York, N.Y., on heroin trafficking charges.
As alleged in the criminal complaint, this matter stems from an investigation by the Drug Enforcement Administration and the Norwalk Police Department into suspected cocaine and heroin distribution by ANDRADE. In September 2014, ANDRADE agreed to provide one kilogram of heroin to a DEA Task Force officer acting in an undercover capacity. ANDRADE, ESTRELLA and GOMEZ were arrested on September 30 after they delivered approximately one kilogram of heroin to a pre-arranged location in Norwalk.
The three defendants appeared yesterday before U.S. Magistrate Judge William I. Garfinkel in Bridgeport and were ordered detained.
Each defendant is charged with one count conspiracy to possess with intent to distribute, and to distribute, one kilogram or more of heroin, an offense that carries a mandatory minimum term of imprisonment of 10 years, a maximum term of imprisonment of life, and a fine of up to $10 million.
U.S. Attorney Daly stressed that a criminal complaint is only a charge and is not evidence of guilt. The defendants are entitled to a fair trial at which it is the Government’s burden to prove guilt beyond a reasonable doubt.
This matter is being investigated by the Drug Enforcement Administration’s Bridgeport High Intensity Drug Trafficking Area (HIDTA) Task Force and the Norwalk Police Department. The Task Force includes personnel from the Norwalk, Stamford, Stratford and Milford Police Departments, and the Connecticut State Police. The case is being prosecuted by Assistant U.S. Attorney H. Gordon Hall.PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]North Slope Worker Convicted of Tax CrimesRead the Press Release
Anchorage, Alaska – U.S. Attorney Karen L. Loeffler announced today that James R. Back, 60, of Soldotna, Alaska, was convicted of seven federal tax crimes in U.S. District Court in Anchorage. After three days of trial and one hour of deliberations, the jury of eight women and four men convicted Back on all charges. Back, who is employed by the Alyeska Pipeline Service Company as a pipeline technician at Pump Station One in Prudhoe Bay, was found guilty of filing false 2006, 2007, and 2008 individual income tax returns, and of failure to file his 2009, 2010, 2011, and 2012 returns. Evidence presented at trial showed that Back earned over $125,000 in wages during each of the prosecution years, yet falsely claimed on the 2006, 2007, and 2008 returns that his wages were zero. For the years 2009-2012, Back simply failed to file.
Other evidence at trial established that Back contributed over $140,000 to a retirement plan during the prosecution years, had investment accounts worth hundreds of thousands of dollars, owned real estate in the Kenai Peninsula Borough, and purchased over $400,000 in gold and silver bullion during the prosecution years. Back represented himself at the trial, and argued to the jury that taxation was immoral and unfair, and that he simply refused to submit to it anymore. He argued that the Alaska Permanent Fund Dividend was not taxable, even though he applied for and received it each year. He also argued that there was no evidence that state or federal laws applied to him. Back ignored prior warnings from his employer, his supervisor, the IRS, and a United States Tax Court judge that his arguments were frivolous.
According to witness testimony, Back used a scheme similar to one promoted by Peter Hendrickson of Michigan. Hendrickson operates a website known as “Lost Horizons” and wrote a book called “Cracking the Code” which promotes the “zero wages” tax evasion scheme. According to federal court records, in 1992 Hendrickson was convicted of failure to file tax returns and firebombing a Michigan post office on April 16, 1990, and served 21 months in prison. In 2010, he was sentenced to another 33 months in federal prison for tax crimes, including filing false returns and failure to file.
The defendant was remanded to the custody of the U.S. Marshal pending sentencing. Chief United States District Judge Ralph R. Beistline described Back’s crimes as “flagrant” and said he was “unrepentant.” The judge set sentencing for December 16. Back faces up to three years in prison on each of the three false return counts, and up to a year in prison on each of the four failure to file counts, in addition to significant criminal fines, restitution, and costs of prosecution.
“Using schemes and tactics intended to willfully conceal income from the IRS isn't tax planning; it’s criminal activity,” said Special Agent in Charge Teri Alexander, IRS Criminal Investigation. “There is no secret formula that can eliminate a person’s tax obligations. This verdict reinforces our commitment to every American taxpayer that we will identify and prosecute those who use abusive scams designed to evade the payment of taxes.”
Ms. Loeffler commends the Internal Revenue Service, Criminal Investigation, for the investigation and prosecution of this case.Norfolk Man Pleads Guilty to Receipt of Child PornographyRead the Press Release
NORFOLK, Va. – Kevin D. Jackson, age 35, of Norfolk, Va., pleaded guilty yesterday to receipt of child pornography.
Dana J. Boente, United States Attorney for the Eastern District of Virginia and Royce E. Curtin, Special Agent in Charge of the FBI’s Norfolk Field Office, made the announcement after the plea was accepted by United States Magistrate Judge Douglas Miller.
A Norfolk federal grand jury indicted Jackson on June 19, 2014, on four counts relating to child pornography. As a result of his guilty plea, Jackson faces a mandatory minimum sentence of five years of incarceration when he is sentenced on February 2, 2015.
According to the statement of facts filed with the plea agreement, Jackson had sought out images of child pornography via the internet for a number of years. A forensic examination confirmed that Jackson retained on his computer 54 videos and 189 pictures of child pornography.
This case was investigated by the FBI. Assistant United States Attorney Randy Stoker 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.
New Orleans Man, Richard Garrett, Sentenced to Ten Years for Drug ViolationsRead the Press Release
U.S. Attorney Kenneth A. Polite announced that RICHARD GARRETT, age 20, a resident of New Orleans, Louisiana, was sentenced today by U.S. District Judge Edson E. Fallon to a 120-month term of imprisonment and 5 years of supervised release following his guilty plea to Conspiracy to Distribute and Conspiracy to Possess with Intent to Distribute Cocaine Baser. On July 19, 2013, GARRETT was one of 12 defendants charged in a 30-count superseding indictment.
This investigation targeted a violent Drug Trafficking Organization that operated out of the Lincoln Manor area of Kenner. During the course of the investigation, two major sources of supply of “crack” cocaine for the Lincoln Manor are of Kenner, were identified and dismantled along with their distribution network. Most of the street level distributors for this Drug Trafficking Organization were identified as being affiliated with a local gang who called themselves the “Flippa Squad.”
U.S. Attorney Polite praised the work of the Drug Enforcement Administration, the High Intensity Drug Trafficking Area, Kenner Police Department, Homeland Security Investigation, Jefferson Parish Sheriff’s Office, Criminal Intelligence Center, Louisiana State Police, Alcohol, Tobacco, Firearms, and Explosives, U.S. Marshals, U.S. Border Patrol, and the St. John Parish Sheriff’s Office in investigating this matter. Assistant United States Attorney J. Collin Sims is in charge of the prosecution.
Nevada County Man Who Shot Federal, State Officers Charged with Federal CrimesRead the Press Release
SACRAMENTO, Calif. — A federal grand jury returned a three-count indictment today against Brent Douglas Cole, 61, of Nevada County, charging him with assault on a federal officer with a deadly weapon which inflicted bodily injury, assault on a person assisting a federal officer with a deadly weapon which inflicted bodily injury, and discharge of a firearm during and in relation to a crime of violence, United States Attorney Benjamin B. Wagner announced.
According to court documents, on June 14, 2014, a BLM ranger stopped Cole after he observed Cole driving his truck on a closed dirt road on BLM land near the South Yuba River campground. The ranger warned Cole not to drive on the road again and allowed him to leave without issuing him a citation. The ranger continued up the dirt road and discovered a makeshift campsite with two motorcycles — one of which had been reported stolen, and one had expired tags. The ranger requested the CHP’s help to impound the motorcycles. While he and a CHP officer were preparing to move the two motorcycles, Cole arrived at the campsite armed, and an exchange of gunfire took place. Cole wounded the BLM ranger in the left shoulder and the CHP officer in the right, lower leg. Cole was struck several times by law enforcement. Cole, the BLM ranger, and the CHP officer received medical attention, and all will survive their wounds.
This case is the product of an investigation by the Federal Bureau of Investigation, the Bureau of Land Management, the Nevada County Sheriff’s Office, the Nevada County District Attorney’s Office, and the California Highway Patrol. Assistant United States Attorneys Michael D. McCoy and Heiko Coppola are prosecuting the case.
If convicted, Cole faces a maximum statutory penalty of 20 years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Miami Residents Plead Guilty in Scheme to File False Tax ReturnsRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and J. Scott Dennis, Chief, North Miami Beach Police Department, announce that defendants Michael Virgile, 28, and Shana Sainvil, 26, both of Miami, each pled guilty to one count of wire fraud, in violation of Title 18, United States Code, Section 1343. Sentencing is scheduled for December 11, 2014 at 9:30 a.m. At sentencing, the defendants each face up to twenty years in prison.
According to court documents, in 2009, Virgile set up a corporation called Tax Masters & Multi-Services LLC (Tax Masters) listing himself as managing member with Sainvil, and Sainvil applied for two electronic filing identification numbers (EFINs) with the IRS. From early 2010 to late 2011, Virgile caused fraudulent income tax returns in other people’s names to be filed with the IRS primarily using Sainvil’s EFINs. Virgile knowingly included fraudulent income amounts and inapplicable tax credits to cause a greater refund payment. Many of the tax returns were prepared in the names of high school or college students who were not entitled to refunds.
Court documents also state that approximately $1.2 million in fraudulent refunds were deposited into bank accounts controlled by Virgil, and between $200,000 and $400,000 in fraudulent refunds were paid into Sainvil’s accounts. The defendants used the fraudulent refund proceeds for their own personal use and benefit.
Mr. Ferrer commended the investigative efforts of IRS-CI, FBI and North Miami Beach Police Department. The case is being prosecuted by Assistant U.S. Attorney Michael N. Berger.
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.
Mexican National Sentenced to One Hundred Months for Violating Federal Firearms and Immigration LawsRead the Press Release
ALBUQUERQUE – Luis Anthony Tobanche, 34, a Mexican national illegally present in the United States, was sentenced today to 100 months in federal prison for violating the federal firearms and immigration laws. Tobanche will be deported after completing his prison sentence.
Tobanche was arrested in March 2013, based on a criminal complaint charging him with being a felon in possession of a firearm. Tobanche was indicted in Aug. 2013 and charged with unlawfully possessing firearms and ammunition on March 5, 2013, and unlawful reentry by a previously deported alien. At the time, Tobanche was prohibited from possessing firearms or ammunition because he previously had been convicted of aggravated battery and assault with a deadly weapon, cocaine trafficking and heroin trafficking in 2006, and battery on a peace officer in 2010.
According to court filings, Tobanche unlawfully possessed firearms and ammunition on March 5, 2013, while on the grounds of the Sandia Casino on Sandia Pueblo, N.M. The Casino’s video surveillance cameras recorded a shooting episode in a parking garage during which Tobanche ran towards the elevators after being shot in the neck. Video-footage reveals that Tobanche attempted to fire at the vehicle from which the shot was fired. After the vehicle drove away, Tobanche entered the elevator and handed a silver handgun to another person. Deputies of the Bernalillo County Sheriff’s Office subsequently recovered the firearm from that person.
On June 9, 2014, Tobanche entered a guilty plea and admitted possessing a pistol, a shotgun and ammunition on March 5, 2013, despite his status as a convicted felon. Tobanche also admitted that he previously was deported from the United States in June 2010 and had not obtained authorization to reenter the United States.
This case was investigated by the Albuquerque office of the FBI, the Sandia Pueblo Tribal Police Department and the Bernalillo County Sheriff’s Office, and was prosecuted by Assistant U.S. Attorney Jon K. Stanford.
The case was prosecuted as part of a federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders for federal prosecution with the goal of removing repeat offenders from communities in New Mexico for as long as possible.
Mexican Man Sentenced in Illegal Reentry CaseRead the Press Release
BUFFALO, N.Y. – U.S. Attorney William J. Hochul, Jr. announced today that Gerardo Hernandez-Barragan, 41, of Mexico, who was convicted of illegal reentry after a conviction of an aggravated felony, was sentenced to 12 months in prison by Chief U.S. District Court Judge William M. Skretny.
Assistant U.S. Attorney Marie P. Grisanti, who handled the case, stated that in January of 2014, Hernandez-Barragan, was arrested following a vehicle stop in Kenmore. The defendant was previously been convicted of distribution of marijuana in South Carolina in 2004.
The sentencing is the culmination of an investigation on the part of United States Customs and Border Protection, under the direction of Randy Howe, Director, Field Operations and the Kenmore Police Department, under the direction of Chief Peter Breitnauer.Methamphetamine Conspirator Sentenced to Ten YearsRead the Press Release
In a federal drug case, Judge William H. Steele imposed a sentence of 121 months imprisonment on Michael Lamar Sweat, 38, of Wilmer, who was convicted of conspiracy to manufacture methamphetamine and possession of a List I chemical with knowledge it would be used to manufacture a controlled substance. Sweat was found guilty of the two charges by a federal jury in June of 2014. Judge Steele ordered that the sentences run concurrently on the two counts. In addition, the judge ordered that Sweat would serve three years’ supervised release after he comes out of prison, and that Sweat pay $200 in special mandatory assessments. The judge further ordered that Sweat undergo testing and treatment for drug abuse during his supervision. No fine was imposed.
The case was investigated by the Mobile County Sheriff’s Office. It was prosecuted in the United States Attorney=s Office by Assistant United States Attorney Gloria Bedwell.
Medina Man Sentenced to 116 Months in Prison for Receiving Child PornRead the Press Release
COLUMBUS, OHIO – Andrew M. Bialek, 24, of Medina, Ohio was sentenced in U.S. District Court to 116 months imprisonment and 20 years supervised release for receiving child pornography.
Carter M. Stewart, U.S. Attorney for the Southern District of Ohio, and Kevin R. Cornelius, Special Agent in Charge, Federal Bureau of Investigation (FBI) announced the sentence handed down today by U.S. District Judge Edmund A. Sargus.
According to court documents, Bialek placed a hidden camera in rooms in various residences in Ohio, Missouri, Kansas and Indiana. Videos recorded by the camera depicted minor females undressing, showering and using the bathroom. While executing a search warrant, investigators also found 121 images of child pornography on Bialek’s computer.
Bialek pleaded guilty on April 11 to receiving child pornography. He was also sentenced to pay $1,200 in restitution.
This case is being brought as part of Project Safe Childhood, a nationwide initiative by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorney's 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 as well as to identify and rescue victims.
U.S. Attorney Stewart commended the investigation by the FBI Columbus Child Exploitation Task Force, which includes officers from the Westerville Police Department, and Assistant U.S. Attorney Heather Hill and Special Assistant U.S. Attorney Jennifer Rausch, who prosecuted the case.Mattapan Man Sentenced to Nine Years in Child Exploitation CaseRead the Press Release
BOSTON – A Mattapan man was sentenced today for distributing child pornography through the Internet.
Luis Miguel Gonzalez-Buzetta, 22, was sentenced by U.S. District Judge F. Dennis Saylor IV to nine years in prison and seven years of supervised release. Upon release, Gonzalez-Buzetta must register as a sex offender. In June of 2014, Gonzalez-Buzetta pleaded guilty to possession and distribution of child pornography.
Gonzalez-Buzetta extensively traded images of minors engaged in sexually explicit conduct, including images of girls between three and six years of age. On June 28, 2013, law enforcement discovered Gonzalez-Buzetta in possession of more than 6,000 images and almost 400 videos of children being exploited, including the lewd and lascivious posing and sexual penetration of young children. Forensic examination of Gonzalez-Buzetta’s digital devices also revealed that he had collected child pornography for at least a year, traded his collection via several digital platforms, and had attempted to hide his activities from law enforcement.
Additional investigation revealed that, between February 13 and March 11, 2013, Gonzalez-Buzetta was trading child pornography from his residence in Boston with an individual in Oregon. Gonzalez-Buzetta requested images from the individual in Oregon, who sent sexualized images of his five-year-old daughter. Gonzalez-Buzetta later requested that a video be made for him of the child engaging in sexual acts.
United States Attorney Carmen M. Ortiz; Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Bruce M. Foucart, Special Agent in Charge of Homeland Security Investigations in Boston; and Boston Police Commissioner William Evans, made the announcement today. The U.S. Attorney’s Office also wishes to thank the Suffolk County District Attorney’s Office, the United States Secret Service, and the Boston Police Department for their tremendous work on the case and their cooperation with the prosecution. The case was prosecuted by Assistant United States Attorney Stacy Dawson Belf of Ortiz’s Major Crimes Unit.
The case was brought as part of Project Safe Childhood. In 2006, the Department of Justice created Project Safe Childhood, a nationwide initiative designed to protect children from exploitation and abuse. Led by the U.S. Attorneys’ Offices and the Criminal Division’s CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend, and prosecute individuals who exploit children, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov/.
Martinsburg Man Charged in Heroin Death CaseRead the Press Release
1125 Chapline Street, Federal Building, Suite 3000 ● Wheeling, WV 26003
(304) 234-0100 ● Contact: Tara Tighe, Public Affairs SpecialistMARTINSBURG, WEST VIRGINIA – A West Virginia man has been indicted for allegedly delivering heroin that caused the death of a Berkeley County man.
United States Attorney William J. Ihlenfeld, II, announced that Keith WATSON, age 35 of Martinsburg, has been charged with “Distribution of Heroin” that led to the death of a 37-year old man in April of 2014. Because the delivery of heroin is alleged to have caused the death of another WATSON faces up to life in prison.
“Drug overdoses have become all too common in the Eastern Panhandle, especially those caused by heroin,” said U.S. Attorney Ihlenfeld. “Whenever we can prove who supplied the drugs that caused an overdose or overdose death then we’ll be aggressive in prosecuting those responsible.”
WATSON is in custody at the Eastern Regional Jail and will appear for an arraignment in U.S. Magistrate Court today.
The case was investigated by the Eastern Panhandle Drug and Violent Crimes Task Force and will be prosecuted by Assistant United States Attorney Jarod J. Douglas. The charges contained in the indictment are merely accusations and are not evidence of guilt. The defendant is presumed innocent until and unless proven guilty.
Manager of Club Tropicana in Espanola Sentenced for Conviction on Federal Tax ChargesRead the Press Release
ALBUQUERQUE – Edward Albert Marquez, 69, the manager and operator of Club Tropicana in Espanola, N.M., was sentenced today to three years of probation, including eight months of electronic monitoring, for his conviction on federal tax charges. Marquez also was ordered to pay $297,842 in restitution to the IRS at a rate of $8,000 per month.
Marquez entered a guilty plea on May 1, 2014, to a two-count felony information charging him with making and subscribing a false tax return, and aiding and assisting the presentment of a false tax return. Count 1 charged Marquez with filing a tax return for tax year 2009 in which he reported no income from Club Tropicana when in fact he received income from Club Tropicana resulting in a tax loss to the United States of $32,701. Count 2 charged Marquez with assisting in the preparation of a tax return for Club Tropicana for tax year 2009 which failed to report income and resulted in a tax loss to the United States of $81,040.
In his plea agreement, Marquez admitted filing false tax returns and assisting in the presentation of false tax returns to evade the assessment of federal taxes by the IRS. Marquez admitted that from 2007 to 2009, he “skimmed” money from Club Tropicana, then a bar and package liquor store in Espanola which he operated and managed. Marquez knowingly provided information that falsely underreported the gross income generated by Club Tropicana in the club owner’s tax returns for tax years 2007, 2008 and 2009. Marquez also admitted taking cash from Club Tropicana’s gross receipts, deposited the cash in his personal bank account, and failed to report this income in his 2007, 2008 and 2009 tax returns. The false returns filed by Marquez and which Marquez caused to be filed resulted in an aggregate of $297,842 in tax losses to the United States.
This case was investigated by the Albuquerque and Santa Fe offices of IRS Criminal Investigation and was prosecuted by Assistant U.S. Attorney Stephen R. Kotz.
Man Who Falsely Obtained A Million Dollar Miami Heat Premium Ticket Package Enters Guilty PleaRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, announced that Haider Zafar, 36, formerly of Miami-Dade County, has entered a guilty plea, in United States District Court in the Southern District of Ohio, to five counts of wire fraud in connection with an investment scam that yielded millions of dollars from investors and a Miami Heat premium ticket package.
At sentencing, Zafar faces a maximum penalty of 20 years in prison on each wire fraud count.
According to the indictment, Zafar would introduce and falsely portray himself as Haider Zafar Haswhani, a member of a wealthy and influential Pakistani family that operated several hotels, textile plants and oil businesses. He claimed he lived in a penthouse in The Essex house in New York, but also had residences at The Setai, the Mondrian, and 10 Museum Park, across the street from the American Airlines Arena.
Using this false persona, Zafar approached a Miami Heat sales executive and fraudulently obtained a Miami Heat premium three-season ticket package, which cost $1,055,000 with a promise to pay in the near future. Then he used the same scheme in approaching several other investors, promising them various investment opportunities and ultimately fraudulently obtaining in excess of $3,500,000.
At the time of this offense Zafar was living in Miami-Dade County. At the time of Zafar was indicted on these charges, he was incarcerated in Ohio awaiting sentencing on federal fraud charges there. Shortly thereafter, the defendant agreed to plead guilty and the case was transferred to the Southern District of Ohio in order for him to enter a guilty plea and his ultimate sentencing.
Mr. Ferrer commended the investigative efforts of the FBI. The case was prosecuted in the Southern District of Florida by Assistant U.S. Attorney Luis M. Pérez. The United States Attorney for the Southern District of Ohio is Carter M. Stewart, and Assistant U.S. Attorney Dale E. Williams, Jr. is prosecuting the case before Edmund A. Sargus, Jr., United States District Judge, Southern District of Ohio
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.
Man Pleads Not Guilty to Kidnapping and Sex Trafficking ChargesRead the Press Release
RENO, Nev. – John Thomas Abrams, 47, aka Buck, aka David George Garnett, aka John McDonald, aka David Blackwell, appeared before a federal magistrate judge today and pleaded not guilty to charges that he kidnapped a 15-year-old boy and girl in California and transported them to Reno with the intent that the girl engage in sexual activity, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
Abrams is charged in a criminal indictment with two counts of kidnapping and one count of transportation of a minor for illegal sexual activity. Abrams was ordered detained pending trial, which was set for Dec. 1, 2014. If convicted, Abrams faces a minimum of 20 years in prison on the kidnapping charges, a minimum of 10 years in prison on the transportation charge, as well as fines of up to $250,000 on each count.According to the allegations contained in the indictment, between about July 12 and July 22, 2012, Abrams kidnapped the girl and the boy in the Sacramento, Calif. area, and held them for ransom, reward, and otherwise. Abrams then transported them to Reno, Nev. with the intent that the girl engage in illegal sexual activity.
“Investigating persons who prey on minors, elderly, and other vulnerable victims, is a top priority of the Justice Department and U.S. Attorney’s Office in Nevada,” said U.S. Attorney Bogden. “We have dedicated more resources than ever to catching and prosecuting these predators, and are working with local, state and federal partners to make sure they face the criminal justice system.”
The investigation is being conducted by the FBI and the Sacramento Police Department. The case is being prosecuted by Assistant United States Attorney Carla Higginbotham.
The 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
The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
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."Malden Man Sentenced to Jail for Tax CrimesRead the Press Release
BOSTON – A Malden man was sentenced today for tax crimes involving the filing of tax returns, and concealing income in the name of a deceased relative.
Mark R. Fisette, 54, was sentenced by U.S. District Judge Denise J. Casper to 10 months in prison, one year of supervised release, and ordered to pay $125,780 in restitution to the IRS. In June 2014, Fisette pleaded guilty to tax evasion and four counts of filing false tax documents.
Fisette worked as a freelance photographer for various weekly and daily newspapers, and had not timely filed or paid his income taxes. When state and federal taxing authorities began collection efforts, including seizing a paycheck, Fisette provided the newspaper distributor with the name and Social Security number of a deceased relative for future payments for Fisette’s photography services. Fisette filed false income tax returns and a false financial statement which did not report the income he received in the dead relative’s name.
United States Attorney Carmen M. Ortiz and William P. Offord, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston, made the announcement today. The case is being prosecuted by Sandra S. Bower of Ortiz’s Economic Crimes Unit.MS-13 Gang Member Sentenced to Life for Murdering Two-Year-Old Child and MotherRead the Press Release
Earlier today at the federal courthouse in Central Islip, New York, Adalberto Ariel Guzman, also known as “Gringo,” a member of La Mara Salvatrucha, also known as the MS-13 street gang, was sentenced to multiple terms of life in prison plus 35 years. Guzman was convicted, on September 9, 2013, following a three-week trial, on all counts, including two counts of murder in aid of racketeering, conspiracy to commit murders in aid of racketeering, and related firearms offenses, in connection with the February 5, 2010 slayings of 19-year-old Vanessa Argueta and her two-year-old son Diego Torres in Central Islip, New York.
The sentence was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York; George Venizelos, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office; and Thomas C. Krumpter, Acting Commissioner of the Nassau County Police Department.
“The MS-13 has become infamous for unleashing ruthless violence on the streets of Long Island. However, even for the MS-13, the execution-style murders of a young mother and an innocent child, carried out by Guzman and his fellow gang members, were particularly senseless and cold-blooded crimes,” stated United States Attorney Lynch. “The tenacious investigation and prosecution by the FBI’s Long Island Gang Task Force and my Office, the jury’s guilty verdict last September, and today’s sentence send the unequivocal message that anyone who engages in such brutal and heinous crimes will spend the rest of his life in federal prison.” United States Attorney Lynch expressed her sincere gratitude to the FBI’s Long Island Gang Task Force for its tireless efforts to bring Guzman and his co-conspirators to justice.
At trial, the government proved that Guzman and other MS-13 members, including MS- 13 leader, Heriberto Martinez, also known as “Boxer,” Juan Garcia, also known as “Cruzito,” and Rene Mendez Mejia, also known as “Zorro,” plotted to kill Argueta because they believed she had disrespected the MS-13. On February 4, 2010, when Guzman, Garcia, and Mejia planned to kill Argueta, she was with her son, and the MS-13 members decided to murder him as well. Guzman, Garcia, and Mejia lured Argueta and Torres into a secluded wooded area in Central Islip, where they executed the mother and child, shooting Argueta in the head and chest, and Torres twice in the head. Specifically, the evidence at trial established that Guzman fired the fatal shots to Torres’s head. After they murdered Argueta and Torres, Guzman, Garcia, and Mejia fled to El Salvador, but Guzman was arrested on May 17, 2010, in Miami, Florida, when he attempted to return to the United States from El Salvador. Thereafter, Guzman was indicted and found guilty on all counts relating to the Argueta and Torres murders following a trial in August and September 2013.
Guzman’s three co-conspirators, Martinez, Garcia, and Mejia were also arrested and indicted in connection with the Argueta and Torres murders. Martinez was convicted in March 2013, following a six-week trial, and later sentenced to life in prison, plus 60 years. Mejia pled guilty to the murders and is pending sentence. Garcia, who surrendered to law enforcement authorities in Nicaragua, waived extradition, and was returned to the United States after being placed on the FBI’s Ten Most Wanted list in March 2014, is pending trial in the Eastern District.1
The convictions of Guzman and his codefendants are the latest in a series of federal prosecutions by the United States Attorney’s Office for the Eastern District of New York targeting members of the MS-13, a violent international street gang comprised primarily of immigrants from El Salvador and Honduras. With numerous branches, or “cliques,” the MS-13 is the largest street gang on Long Island. Since 2003, more than 250 MS-13 members, including dozens of clique leaders, have been convicted on federal felony charges in the Eastern District of New York. More than 150 of those MS-13 members have been convicted on federal racketeering charges. Since 2010 alone, this Office has obtained indictments charging MS-13 members with carrying out more than 20 murders in the Eastern District of New York, and has convicted more than 35 MS-13 members in connection with those murders. These prosecutions are the product of investigations led by the FBI’s Long Island Gang Task Force, comprising agents and officers of the FBI, Nassau County Police Department, Nassau County Sheriff’s Department, Suffolk County Probation, Suffolk County Sheriff’s Department, Rockville Centre Police Department, and Suffolk County Police Department.
The sentence was imposed by United States District Judge Joseph F. Bianco.
The government’s case is being prosecuted by Assistant United States Attorneys John J.
Durham and Raymond A. Tierney.
The Defendant:
ADALBERTO ARIEL GUZMAN, also known as “Gringo”
Central Islip, New York
Age: 22
__________________________________________________________________________
1 The charges contained in the indictment against Garcia are merely allegations, and he is
presumed innocent unless and until proven guilty.
Louisiana Army National Guard Soldiers Charged with Conspiracy to Commit Theft of Government Funds<br /> and Identity TheftRead the Press Release
U.S. Attorney Kenneth A. Polite announced that today, a federal grand jury indicted PABLO E. PAZ, 45, a resident of New Orleans, Louisiana, and RAMON E. MADRID, 29, a resident of Kenner, Louisiana, for conspiracy to commit theft of government funds and identity theft.
According to court documents, PAZ was a recruiter for the Louisiana Army National Guard. In this capacity, he obtained personally identifiable information (PII), such as names, dates of birth and social security numbers, from potential soldiers that came to the recruiting station for the purpose of becoming a soldier. PAZ provided the PII of potential soldiers to MADRID without the knowledge or consent of the soldiers, to obtain Guard Recruiter Assistance Program (G-RAP) incentive payments to which they were not entitled. MADRID received approximately $30,000 in fraudulently obtained recruitment incentive payments, and provided a portion of the funds to PAZ.
If convicted, PAZ and MADRID face a maximum term of five years imprisonment, a fine of up to $250,000, and up to three years of supervised release.
U.S. Attorney Polite reiterated that the indictment is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
U.S. Attorney Polite praised the work of the United States Army Criminal Investigation Division Command and the Defense Criminal Investigative Service in investigating this matter. Public Integrity Unit Chief and Assistant United States Attorney Tracey N. Knight is in charge of the prosecution.
(Download Indictment )
Long Island Doctor Sentenced to Eight Years of Imprisonment for Conspiracy to Distribute Oxycodone and Distribution of OxycodoneRead the Press Release
William Conway, a medical doctor who formerly ran a practice in Baldwin, New York, was sentenced today to a term of eight years’ imprisonment for conspiring to illegally distribute the highly-addictive narcotic oxycodone, to be followed by three years of supervised release. The sentence was pronounced by United States District Judge Leonard D. Wexler, who ruled last month that the defendant was esponsible for the overdose death of a patient to whom he prescribed oxycodone for no legitimate medical purpose.
The sentence was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York; James J. Hunt, Acting Special Agent-in-Charge, Drug nforcement Administration (DEA), New York, and Thomas C. Krumpter, Acting Commissioner, Nassau County Police Department (NCPD).
Conway was arrested in June 2012 following a state and federal investigation into the defendant’s practice of issuing oxycodone prescriptions at an average of 163 per month between 2009 and 2011 -- a rate that equated to the distribution of over 782,000 pills. Conway’s office files revealed only cursory, incomplete examinations of patients, overlapping prescriptions to the same patients, and as one government witness put it, no effort to “try and fix the patient’s condition rather than perpetuate the use of the narcotics.”
During a hearing before Judge Wexler in May, the government presented evidence that the defendant prescribed large quantities of oxycodone to a patient, Giovanni Manzella, for no legitimate medical purpose and that the illegal distribution caused Manzella’s overdose death on April 23, 2011. Records showed that Conway issued Manzella five
oxycodone prescriptions, totaling over 800 pills, over a six month period with little or no examination or diagnostic testing, such as an MRI, or any effort to ensure that the patient was not abusing the narcotic. Evidence also showed that Conway prescribed 180 oxycodone pills to Manzella on April 21, 2011, and then 24 hours later, prescribed Manzella an additional 270oxycodone pills without performing any medical evaluation. Manzella died the next day.
In an August 2014 writen opinion, Judge Wexler noted, “Incredibly, Dr. Conway wants this Court to find that, when Manzella was under his medical supervision, somehow he was practicing medicine and prescribing oxycodone for a legitimate medical purpose.” Instead, Judge Wexler found that the government’s evidence “amply demonstrates that he prescribed oxycodone to Manzella for no legitimate medical purpose, and that Manzella died as a result of using the oxycodone prescribed by him.”
In announcing today’s sentence, United States Attorney Lynch stated, “Instead of using his skills as a physician to ‘do no harm,’ Conway perpetuated pain and suffering, inundating our communities with a highly addictive narcotic and causing the death of a young man struggling with substance abuse. This case should serve as a warning that health care professionals engaged in such conduct face not merely the loss of their privilege to practice medicine, but their liberty as well.” Ms. Lynch extended her grateful appreciation to each of the law enforcement agencies for their assistance in this case.
Oxycodone is a scheduled controlled substance that may be dispensed by medical professionals only for a legitimate medical purpose in the usual course of a doctor’s professional practice. It is a powerful and highly addictive drug and is increasingly abused because of its potency when crushed into a powder and ingested, leading to a heroin like euphoria.
Conway’s conviction is the latest in a series of federal prosecutions by the United States Attorney’s Office for the Eastern District of New York as part of the Prescription Drug Initiative. In January 2012, this Office and the DEA, in conjunction with the five District Attorneys in this jurisdiction, the Nassau and Suffolk County Police Departments, the New York City Police Department, and New York State Police, along with other key federal, state, and local government partners, launched the Prescription Drug Initiative to mount a comprehensive response to what the United States Department of Health and Human Services’ Center for Disease Control and Prevention has called an epidemic increase in the abuse of so-called opioid analgesics. So far, the Prescription Drug Initiative has brought over 160 federal and local criminal prosecutions, including the prosecution of 15 health care professionals, taken civil
enforcement actions against a hospital, a pharmacy, and a pharmacy chain, removed prescription authority from numerous rogue doctors, and expanded information-sharing among enforcement agencies to better target and pursue drug traffickers. The Initiative also is involved in an extensive community outreach program to address the abuse of pharmaceuticals.
The government’s case was prosecuted by Assistant United States Attorney Michael P. Canty.
The Defendant:
Name: William Conway
Age: 71
Residence: Baldwin, NY
Lincoln County Man Convicted of Tax ChargesRead the Press Release
St. Louis, MO – PETER GIAMBALVO was convicted of obstructing the internal revenue laws and filing false tax returns for the years 2003-2010. The three-day trial was held before United States District Judge Rodney W. Sippel.
According to testimony presented at trial, Giambalvo was an employee of The Boeing Company and had not filed income tax returns for the years 2000-2009. After being contacted by an IRS Revenue Officer in late 2010, Giambalvo agreed to file income tax returns for those years. However, in January 2011, Giambalvo mailed tax returns to the Revenue Officer for years 2000-2010. Each of these returns stated that the amount of wages and other items of income which he received during those years was zero. However, for the years 2003-2010, there was evidence that Giambalvo received wages from The Boeing Company in amounts substantially in excess of the zero amounts reported on the returns. Giambalvo also included a letter to the Revenue Officer which claimed that he was a "nontaxpayer," and was not required to pay taxes because he worked in the private sector and not for the government.
"The law is clear on the issue of taxable income and who is required to file and pay taxes: There is no gray area on the subject," said Sybil Smith, Special Agent in Charge of IRS Criminal Investigation. "Today’s conviction shows that those who willfully defy the tax laws, regardless of their motivations or convictions, will be held accountable.".
Giambalvo, Hawk Point, MO, was convicted of one felony count of interfering with the administration of the Internal Revenue laws, and eight felony counts of filing false tax returns. Sentencing has been set for January 2, 2015. After the jury verdict, Judge Sippel ordered that Giambalvo be held in custody until sentencing.
Each count carries a maximum penalty of three years in prison and/or fines up to $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by IRS Criminal Investigation. Assistant United States Attorney Steven Muchnick is handling the case for the U.S. Attorney's Office.
Leader of Hudson County, N.J., Set of Violent International Street Gang Admits Murder ConspiracyRead the Press Release
NEWARK, N.J. – A member of the international criminal street gang Mara Salvatrucha (also known as “MS” or “MS-13”), today admitted trying to kill a rival gang member, U.S. Attorney Paul J. Fishman announced.
Marvin Garcia-Cruz, a/k/a “Buffalo,” 31, of West New York, New Jersey, pleaded guilty today before U.S. District Court Judge Stanley R. Chesler to one count of conspiring to commit murder in aid of racketeering and one count of conspiring to possess firearms in furtherance of a crime of violence. Garcia-Cruz was previously indicted in July 2014 with numerous other top-ranking members of MS-13 for various racketeering crimes.
According to documents filed in this case and statements made in court:
Garcia-Cruz admitted to being the leader of an MS-13 set, or “clique,” operating in Hudson County, known as “Pinos Locos Salvatrucha.” In November 2013, leaders of several MS-13 cliques operating in northern New Jersey hatched a plot to murder rival gang members. Before carrying out the plot, these local gang leaders sought authorization from some of the highest-ranking members in the gang’s national and international leadership – including Joel Antonio Cortez, a/k/a “Pee Wee,” who served as a top deputy to Jose Juan Rodriguez-Juarez, a/k/a “Sacerdote,” the leader of Mara Salvatrucha in the United States. Law enforcement learned of the murder plot during the course of the investigation and arrested gang members, including Garcia-Cruz, before it could be carried out.
The murder conspiracy count to which Garcia-Cruz pleaded guilty carries a maximum potential penalty of 10 years in prison and a $250,000 fine. The firearm conspiracy count carries a maximum potential penalty of 20 years in prison and a $250,000 fine. Sentencing is scheduled for Jan. 21, 2015.
Aside from Garcia-Cruz, eight defendants – including Cortez and Rodriguez-Juarez – remain in federal custody, awaiting trial on the indictment pending before Judge Chesler.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford, with the investigation leading to today’s guilty plea. The investigation involved multiple FBI Field Offices, with substantial assistance provided by the FBI Field Office in Los Angeles. Fishman also thanked the Hudson County Prosecutor’s Office, under the direction of Acting Prosecutor Gaetano T. Gregory, and the Union County Prosecutor’s Office, under the direction of Acting Prosecutor Grace Park, for their work on this case. He also acknowledged the U.S. Attorney’s Office for the Central District of California for its assistance in the ongoing investigation.
The government is represented by Assistant U.S. Attorneys James M. Donnelly and Andrew J. Bruck of the U.S Attorney’s Office Organized Crime/Gangs Unit in Newark.
The charges and allegations contained in the indictment are merely accusations, and the other defendants are presumed innocent unless and until proven guilty.
14-355
Defense Counsel: Pierre Eloi Esq., Orange, New Jersey
Rodriguez-Juarez, Jose Juan et al. Indictment
Lake Charles Man Pleads Guilty to Charge in Terrorism HoaxRead the Press Release
LAKE CHARLES, La. –United States Attorney Stephanie A. Finley announced today that a Lake Charles man pleaded guilty to a charge that he lied to federal agents in order to blame his wife for a fake terror plot.
Monte Henry Hurley, 54, of Lake Charles, pleaded guilty before U.S. District Judge Patricia Minaldi, to one count of making false statements to FBI agents. According to evidence at the guilty plea, Hurley falsely reported on October 18, 2013 that his estranged wife had forwarded a letter to him that contained a white powdery substance leaving law enforcement authorities to believe it may be anthrax, a biological weapon. Authorities quarantined Hurley and responding officers, and engaged in extensive response protocols for anthrax, which included evacuation and testing of the material. About a week later, Hurley claimed responsibility for the letter and powder admitting that he lied to authorities in order to frame his estranged wife.
Hurley faces up to five years in prison, up to three years of supervised release, and a $250,000 fine. A sentencing date of January 8, 2015, was set.
The members of the Joint Terrorism Task Force, which is composed of the FBI, U.S. Border Patrol, Louisiana State Police, Calcasieu Parish Sheriff’s Office, and the Lake Charles Fire Department, investigated the case. Assistant U.S. Attorney Myers P. Namie is prosecuting the case.
Jury Convicts Charlotte Man of Federal Racketeering in Connection with Operation Wax HouseRead the Press Release
CHARLOTTE, N.C. – On Wednesday, October 1, 2014, a federal jury returned a guilty verdict against Kurosh Mehr for his role in a $75 million racketeering conspiracy, announced the U.S. Attorney’s Office for the Western District of North Carolina. This conviction is the latest in Operation Wax House, an investigation which began in 2007 and has netted 91 defendants to date, of which 88 have pleaded guilty or have been convicted at trial. Mehr, 53, of Charlotte was convicted of racketeering conspiracy, mortgage fraud, and money laundering conspiracy.
U.S. Attorney Tompkins is joined in making today’s announcement by John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division and Thomas J. Holloman III, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division (IRS-CI).
The federal criminal trial began on Monday, September 29, 2014 before Senior U.S. District Judge Graham Mullen. According to evidence introduced at trial, the enterprise, which operated from 2005 to 2012, engaged in an extensive pattern of racketeering activities, which included investment or securities fraud, mortgage fraud in the form of wire fraud and bank fraud, and money laundering.
According to trial evidence, Mehr was a promoter and buyer in the enterprise’s mortgage fraud operations. The evidence at trial showed that initially Mehr served as a promoter, providing tens of thousands of dollars as down payment money for the enterprise’s purchase of luxury homes utilizing several straw buyers. In exchange, trial evidence showed that the conspiracy would divide up the loan funds that were supposed to be the seller’s proceeds, paying themselves back the down payment money they fronted plus a 10% kickback following the closing of the loan. According to trial evidence, Mehr later agreed to serve as a buyer for the enterprise in a flip transaction, in which he bought a house from a straw buyer for a price that was approximately $500,000 over the price the enterprise had purchased the house for months earlier. The evidence showed that this $500,000 difference was used to cover the down payment (which was netted from the seller’s proceeds) and to pay kickbacks to members of the enterprise, including more than $300,000 which was transferred to Mehr and his coconspirators. Following the jury’s conviction, the defendant was remanded to custody. The racketeering conspiracy charge carries a maximum term of 20 years in prison and a $250,000 fine or twice the gross profits or other proceeds. The money laundering conspiracy charge carries a maximum term of 20 years in prison and a $500,000 fine or twice the amount of criminally derived proceeds. The mortgage fraud conspiracy charge carries a maximum prison term 30 years in prison and $1 million fine. A sentencing date for the defendant has not been set yet.
Three defendants have charges pending in the case, two of which, including one of the leaders, are international fugitives. Each remaining defendant and his or her status are listed below:
• Ramin Amini, 45, of Tehran, Iran, is charged with racketeering conspiracy, mortgage fraud and money laundering conspiracy. Role: Leader and promoter in the scheme. Status: International fugitive.
• John Wayne Perry, Jr., 32, of Charlotte, is charged with racketeering conspiracy and money laundering conspiracy. Role: Promoter. Status: On bond; Scheduled for trial after September 2014.
• Nazeere Saddig, 41, formerly of Charlotte, is charged with racketeering conspiracy and mortgage fraud. Role: Promoter and buyer. Status: International fugitive.Operation Wax House in the Western District of North Carolina is being handled by the Charlotte Division of the FBI and the Criminal Division of the IRS for the Financial Fraud Enforcement Task Force, along with the Securities Division of the North Carolina Secretary of State. The case was tried by Assistant United States Attorneys Maria K. Vento and Jenny Grus Sugar.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Since the inception of FFETF in November 2009, the Justice Department has filed more than 12,841 financial fraud cases against nearly 18,737 defendants including nearly 3,500 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
Jeremiah Santos Isezaki Sentenced to 57 Months in PrisonRead the Press Release
ALICIA A.G. LIMTIACO, United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that Defendant JEREMIAH SANTOS ISEZAKI, age 30, was sentenced on October 1, 2014, in the District Court of Guam by Chief Judge Frances Tydingco-Gatewood.
Defendant Isezaki was sentenced to 57 months in prison with credit for time served. He will be placed on three years supervised release when he gets out of jail. Isezaki was assessed a $100 special assessment fee and ordered to perform 25 hours of community service.
On January 30, 2012, a Guam Police Department (GPD) officer attempted to pull over Isezaki for a traffic violation. Defendant Isezaki kept going which led to a high speed chase reaching speeds of up to 100 miles an hour. Defendant eventually ran off the road while driving his motorcycle and GPD officers arrested him. The officers recovered a Colt .45 1911 pistol. Defendant Isezaki was convicted by a jury on June 12, 2012.
Credit for the investigation is given to GPD together with and the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). The case was handled by Assistant U.S. Attorney Clyde Lemons.Illegal Alien from Honduras, Dayron Otoniel Madrid-guillen, Pleads Guilty to Illegally Possessing A HandgunRead the Press Release
U.S. Attorney Kenneth Polite announced that DAYRON OTONIEL MADRID-GUILLEN, 28, a Honduran national illegally residing in the United States, pled guilty today to possession of a handgun by a person illegally present in the United States, in violation of 18 U.S.C. Section 922(g)(5)(A).
According to court documents, MADRID-GUILLEN was spotted by a New Orleans Police Officer riding a bicycle in an erratic manner. The officer continued to observe MADRID-GUILLEN as MADRID-GUILLEN got off the bicycle and walked away from the officer. The officer saw what appeared to be the outline of a handgun completely concealed in MADRID-GUILLEN’s rear pocket. The officer stopped MADRID-GUILLEN, patted him down, and found a fully loaded handgun and six small bags of marijuana in his possession. MADRID-GUILLEN was later questioned by agents from Homeland Security Investigations and admitted that is a Honduran national who had entered the United States illegally.
U.S. District Judge Carl J. Barbier set sentencing for January 8, 2015.
U.S. Attorney Polite praised the work of the Homeland Security Investigations and the New Orleans Police Department in investigating this matter. Assistant United States Attorney Gregory M. Kennedy is in charge of the prosecution.
High-Frequency Trader Indicted for Manipulating Commodities Futures Markets in First Federal Prosecution for "Spoofing"Read the Press Release
CHICAGO ― In the first federal prosecution of its kind, a high-frequency trader was indicted for allegedly manipulating commodities futures prices and illegally profiting nearly $1.6 million as a result of trading orders he placed through CME Group and European futures markets in 2011. The defendant, MICHAEL COSCIA, was the manager and sole owner of the former Panther Energy Trading LLC, of Red Bank, N.J., which he formed in 2007.
Coscia, 52, of Rumson, N.J., a registered commodities trader since 1988, was charged with six counts of commodities fraud and six counts of “spoofing” in a 12-count indictment returned yesterday by a federal grand jury, Zachary T. Fardon, United States Attorney for the Northern District of Illinois, and Robert J. Holley, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation, announced today.
The indictment marks the first federal prosecution nationwide under the anti-spoofing provision that was added to the Commodity Exchange Act by the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act.
Coscia will be arraigned on a date to be determined in U.S. District Court in Chicago.
“Traders and investors deserve a level playing field, and when the field is tilted by market manipulators, regardless of their speed or sophistication, we will prosecute criminal violations to help ensure fairness and restore market integrity,” Mr. Fardon said. “This case reflects the reasons why, earlier this year, we established a Securities and Commodities Fraud Section, which is dedicated to protecting markets and preserving investors’ confidence,” he added.
According to the indictment, high-frequency trading is a form of automated trading that uses computer algorithms for decision-making and placing a high volume of trading orders, quotes, or cancelation of orders in milliseconds. Coscia designed two computer programs he allegedly used in 17 different CME Group markets and three different markets on the London-based ICE Futures Europe exchange, including gold, soybean meal, soybean oil, high-grade copper, Euro FX and Pounds FX currency futures, to implement his fraudulent strategy. It was illegal for traders to place orders in the form of “bids” to buy or “offers” to sell a futures contract with the intent to cancel the bid or offer before execution.
Between August and October 2011, Coscia allegedly defrauded participants in the CME Group and ICE Futures Europe markets. In August 2011, Coscia began a high-frequency trading strategy in which he entered large-volume orders that he intended to immediately cancel before they could filled by other traders, the indictment alleges.
Coscia devised this strategy to create a false impression regarding the number of contracts available in the market, and to fraudulently induce other market participants to react to the deceptive market information he created, the indictment states. His strategy moved the markets in a direction favorable to him, enabling him to purchase contracts at prices lower than, or sell contracts at prices higher than, the prices available in the market before he entered and canceled his large-volume orders, it adds. Coscia then allegedly repeated this strategy in the opposite direction to immediately obtain a profit by buying futures contracts at a lower price than he paid for them, or by selling contracts at a higher price than he paid for them. Each such trade allegedly occurred in a matter of milliseconds. As a result of the aggregate of those fraudulent high-frequency trades, Coscia illegally profited approximately $1,592,867 over approximately three months, the indictment alleges.
As part of the scheme, Coscia’s trading programs looked for market conditions such as price stability, low volume at the best prices, and a narrow difference between the prices at which prospective purchasers were willing to buy and prospective sellers were willing to sell because his allegedly fraudulent trading strategy worked best under these conditions. His trading programs sometimes placed a “ping order” of one contract to test the market and ensure that conditions would allow his strategy to work well.
Coscia allegedly designed his trading programs to place a “trade order” on one side of the market, intending that the trade order be filled. He profited from his fraudulent strategy by filling the “trade order,” the charges allege.
He also designed his programs to place several layers of “quote orders” on the other side of the market from his trade orders ― either to buy contracts at a price higher than the prevailing offer, or to sell contracts at a price lower than the prevailing bid ― to create the illusion of market interest. The quote orders would typically be the largest orders in the market within three ticks (the minimum price increment at which a futures contract could trade) of the best bid or offer price, usually doubling or tripling the total quantity of contracts within the best bid or offer price.
The indictment alleges that Coscia designed his programs to cancel the quote orders within a fraction of a second automatically, without regard to market conditions, even if the market moved in a direction favorable to the quote orders. He programmed the quote orders to cancel because he did not intend for them to be filled, but instead intended to trick other traders into reacting to the false price and volume information, it adds. Further, Coscia designed his programs to cancel all fraudulent and misleading quote orders immediately if any of them were even partially filled, because he intended them only to trick other traders into reacting to what appeared to be a substantial change in the market.
After Coscia filled his trade order through the use of fraudulent and misleading quote orders, he immediately entered a second trade order on the other side of the market and repeated his steps with misleading quote orders, causing the second trade order to be filled. As a result, Coscia allegedly profited on the difference in price between the first and second trade orders.
The indictment details an example through trades that Coscia placed milliseconds apart in the Euro FX market during the early morning on Sept. 1, 2011. By entering large orders that he intended to cancel at the time he placed them, and caused to be canceled before other traders could fill them, Coscia made a profit by buying 14 contracts at 14288 ticks and selling them at 14289 ticks less than one second later.
The government is being represented by Assistant U.S. Attorney Renato Mariotti.
Each count of commodities fraud carries a maximum sentence of 25 years in prison and a $250,000 fine, and each count of spoofing carries a maximum penalty of 10 years in prison and a $1 million fine. If convicted, the Court must impose a reasonable sentence under federal sentencing statutes and the advisory United States Sentencing Guidelines.
The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Indictment
Gulfport Man Sentenced for Deepwater Horizon Oil Spill FraudRead the Press Release
Gulfport, Miss. – Brian K. Lee, 40, of Gulfport, was sentenced today by U.S. District Judge Sul Ozerden to thirty-four months in federal prison followed by three years of supervised release for mail fraud in connection with the Deepwater Horizon Oil Spill, U.S. Attorney Gregory K. Davis announced today. Lee was also ordered to pay a $2,500.00 fine and restitution in the amount of $47,083.76.
Lee knowingly devised a scheme to defraud the Gulf Coast Claims Facility established by BP Exploration and Production, Inc., to administer, process, and settle certain claims of individuals and businesses that had been impacted by the Deepwater Horizon Oil Spill. Lee made false representations in a claim form, and in various documents submitted in support of his claim, that he lost earnings and profits from his employment as a customer service representative at Gulf South Seafood as a result of the Deepwater Horizon Oil Spill. The investigation revealed no such company ever existed. Lee received $47,083.76 as a result of his fraudulent claim.
This case was investigated by agents of the United States Secret Service and prosecuted by Assistant U.S. Attorney Andrea Jones. It was brought as part of this District’s partnership with the National Center for Disaster Fraud (NCDF), a nationwide initiative to protect available funds and assistance for those victims of both natural and man-made disasters such as hurricanes, floods, tornadoes and the recent Gulf oil spill. If you have knowledge of fraud, waste, abuse, or allegations of mismanagement involving disaster relief operations, you can contact the NCDF by either calling the hotline at (866) 720-5721, faxing (225) 334-4707, emailing at [email protected] or in writing to National Center for Disaster Fraud, Baton Rouge, LA 70821-4909.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.
Gregg County Man Guilty of Dealing Cocaine in East TexasRead the Press Release
Department of Justice
Office of Public AffairsTYLER, Texas – A35-year-old Longview, Texas man has pleaded guilty to drug trafficking charges in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Antonio Cortez Gonzales pleaded guilty to conspiracy to distribute and possession with intent to distribute cocaine and marijuana today before U.S. Magistrate Judge John D. Love.
According to information presented in court, on Aug. 19, 2013, law enforcement officers executed a search warrant at Gonzales’ Longview residence. The search revealed 150 grams of cocaine, 6.5 kilograms of marijuana, empty wrappers for kilogram quantities of cocaine, guns and ammunition. Further investigation revealed kilograms of cocaine were being transported from Houston to Gonzales in Longview for distribution to others. A federal grand jury returned a 30-count indictment on Apr. 23, 2014, charging Gonzales and 17 others with drug trafficking violations.
Gonzales faces up to life in federal prison. A sentencing date has not been set.
This case is the result of an ongoing Organized Crime Drug Enforcement Task Force (OCDETF) joint investigation. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
This case is being investigated by the Drug Enforcement Administration and prosecuted by Assistant U.S. Attorney Mary Ann Cozby.
Government Files Notice of Intent to Seek the Death Penalty in United States of America V. Jessie Con-UiRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced today that it filed a Notice of Intent to Seek the Death Penalty in United States of America v. Jessie Con-Ui.
Geographic Targeting Order Issued by FinCEN Aims at Money Laundering for Drug Cartels in Los Angeles Fashion DistrictRead the Press Release
LOS ANGELES – Federal authorities today announced that the Financial Crimes Enforcement Network (FinCEN) has issued a Geographic Targeting Order (GTO) that imposes additional reporting and recordkeeping obligations on most of the businesses located in the Los Angeles Fashion District. The GTO will enhance law enforcement’s ongoing efforts to identify and pursue cases against persons and businesses engaged in money laundering that benefits international drug cartels.
The GTO, which will go into effect on October 9, was sought by the United States Attorney’s Office for the Central District of California as part of a sweeping investigation targeting the illicit movement of U.S. currency to Mexico and Colombia on behalf of prominent drug trafficking organizations. The Justice Department is working with U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) and the Internal Revenue Service’s Criminal Investigation Division to fight money laundering schemes designed to allow international drug cartels in Central America and South America to reach drug proceeds generated in the United States.
A series of investigations have revealed evidence that money laundering activities and violations of the Bank Secrecy Act (BSA) are pervasive throughout the Los Angeles Fashion District, which includes more than 2,200 businesses. Much of the money laundering is conducted through Black Market Peso Exchange schemes – also known as trade-based money laundering – in which drug money in the United States is converted into goods that are shipped to countries such as Mexico, where the goods are sold and money in the form of local currency goes to the drug trafficking organizations.
There are approximately 2,300 businesses that are being served with notice of today’s order, including garment and textile stores, transportation companies, travel agencies, perfume stores, electronic stores (including those that only sell cell phones), shoe stores, lingerie stores, flower/silk flower stores, beauty supply stores, and stores bearing “import” or “export” in their name.
On September 10, more than 1,000 federal, state and local law enforcement officials were in the Fashion District, where they executed dozens of search warrants and arrest warrants linked to businesses suspected to be engaged in money laundering schemes (see: http://www.justice.gov/usao/cac/Pressroom/2014/117.html). Criminal investigations have uncovered evidence that many of these businesses are routinely accepting bulk cash Black Market Peso Exchange schemes on behalf of drug trafficking organizations based in Mexico and Colombia. During last month’s enforcement action, authorities seized more than $90 million in currency. The cash was found at various residences and businesses stored in file boxes, duffel bags, backpacks and even in the trunk of a Bentley. Another approximately $45 million was seized in the form of property and bank accounts.
“This order requires nearly every business in the Fashion District to report any instance in which they receive at least $3,000 in cash, and failure to comply with the order could lead to a criminal indictment,” said Acting United States Attorney Stephanie Yonekura. “My office sought the unprecedented order from FinCEN with the goal of shutting down the flow of dirty money to foreign drug cartels – a huge problem that has contaminated the Fashion District."
Claude Arnold, special agent in charge for HSI Los Angeles, commented: “Last month, in a matter of hours, HSI special agents seized tens of millions of dollars in cash from individuals with business interests in L.A.’s garment district. That’s a mindboggling amount of money and it makes it abundantly clear the scale of criminal activity we’re up against. International drug cartels generate billions of dollars a year in profits, but all that cash is virtually worthless unless traffickers can find a way to funnel it clandestinely back into the monetary system. Unscrupulous companies that help the cartels cover their financial tracks are contributing in a major way to the devastation wrought by the international drug trade and they will be held to answer for their actions.”
Richard Weber, Chief of IRS - Criminal Investigation, said: "Individuals who laundered money through the fashion industry will now be hard pressed to continue their criminal activities. The issuance of this Geographic Targeting Order will assist law enforcement agencies in ferreting out money launderers from this trade industry and will help to preserve a strong local economy."
FinCEN Director Jennifer Shasky Calvery stated: “This GTO illustrates that FinCEN will not shy away from using each and every one of its authorities to disrupt drug cartel activity. FinCEN’s expertise goes far beyond collecting the BSA data. Our own analysis of thousands of BSA filings played a critical role in the recent takedown, as well as ongoing law enforcement operations. And the additional information collected through FinCEN’s GTO will only increase our ability to track and dismantle these criminal organizations.”
The GTO will take effect on October 9, 2014 and will remain in effect for 180 days. Affected businesses in the Los Angeles Fashion District should review the Order to understand their reporting obligations. Covered businesses with questions about today’s order should contact the FinCEN Resource Center at 800-767-2825.
Release No. 14-132
Gardiner Man Sentenced to over 3 Years for Pharmacy RobberyRead the Press Release
Contact: Craig M. Wolff
Assistant United States Attorney
Tel: (207) 780-3257Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Ryan
McLaughlin, 27, of Gardiner, Maine, was sentenced today in U.S. District Court by Judge D.
Brock Hornby to 37 months in prison and three years of supervised release for pharmacy
robbery. McLaughlin pleaded guilty on April 17, 2014.According to court records, on November 13, 2013, McLaughlin entered the Shaw’s
Osco pharmacy in Augusta and handed a note to a pharmacy employee demanding two bottles of
Oxycodone. He was agitated as he spoke with the pharmacy staff, stating that he was in a hurry
and demanding that they move faster. He also kept one of his hands in his pocket during the
incident, as if he were concealing something. Pharmacy personnel provided him with two bottles
of Oxycodone and he left the store. In an interview after his arrest, McLaughlin admitted robbing
the store and said he had committed the robbery to obtain pills to feed his severe addiction.The investigation was conducted by the Augusta Police Department and the Federal
Bureau of Investigation.Fremont Man Sentenced to 5 years in Prison for Possession with the Intent to Distribute MethamphetamineRead the Press Release
United States Attorney Deborah R. Gilg announced that Kurt Hansen, 34, of Fremont, Nebraska, was sentenced on October 2, 2014, to 5 years in prison by United States District Judge Joseph F. Bataillon. Hansen had previously pled guilty after he was caught with 12 grams of methamphetamine outside of a Fremont residence where agents were conducting a search warrant. Because Hansen possessed more than 5 grams of actual methamphetamine, he faced a mandatory minimum sentence of 5 years. After serving his sentence Hansen will be required to serve a Term of Supervised Release of 5 years.
This case was the result of an investigation by the III CORPS Drug Task Force.
Four Arrested and Charged with Participating in A Marijuana Trafficking ConspiracyRead the Press Release
BOSTON – Louis J. Dinunzio, 27, of Medford, Joseph Spagnuolo-Kazonis, 29, of Boston, John Woodman, 42, of Braintree, and Robert Fitzpatrick, 40, of Quincy, were charged with conspiracy to distribute and possess with intent to distribute 50 kilograms or more of marijuana.
All four men were arrested today and will appear in U.S. District Court in Boston.
The charge of marijuana distribution conspiracy carries a maximum sentence of 20 years in prison, a mandatory minimum of three years of supervised release and a maximum $1 million fine. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
In a separate indictment returned on Wednesday, brought as part of a related ongoing federal investigation of organized crime in Massachusetts, two members of the New England Family of La Cosa Nostra (NELCN) were charged with conspiring to collect extortionate protection payments from a video poker machine company based in Revere. Anthony “Spucky” Spagnolo, 72, whom the indictment alleges to be the acting boss of the NELCN, and Pryce “Stretch” Quintina, 74, both of Revere, were each charged with one count of conspiring to interfere with commerce through extortion.
Spagnolo and Quintina were also arrested this morning and will appear later today in U.S. District Court in Boston.
The charge of extortion affecting commerce carries a maximum sentence of 20 years in prison, three years of supervised release and a $250,000 fine. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz; Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; William P. Offord, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; and Colonel Timothy P. Alben, Superintendent of the Massachusetts State Police made the announcement today. The cases were investigated with the assistance of the Boston, Medford, and Quincy Police Departments and the Massachusetts Department of Corrections. The cases are being prosecuted by Assistant U.S. Attorney’s Timothy E. Moran of Ortiz’s Strike Force Unit and Seth B. Kosto of Ortiz’s Computer Crimes Unit.
The details contained in the indictments are allegations. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Former State of Alabama Employee Pleads Guilty to Stealing Identities from State Databases that were used to Request over $7 Million in Tax RefundsRead the Press Release
Montgomery, Alabama - Tamika Floyd (30), a resident of Salem, Ala., pled guilty to one count of conspiracy to defraud the United States and one count of aggravated identity theft for her involvement in a Stolen Identity Tax Refund Scheme (SIRF), announced Deputy Assistant Attorney General Ronald A. Cimino of the Justice Department's Tax Division and U.S. Attorney George L. Beck Jr. for the Middle District of Alabama.
According to court documents, between 2006 and 2014, Floyd worked at two different state agencies located in Opelika, Alabama. At both jobs, she had access to identification information for numerous individuals. Beginning in 2012, Floyd was approached about getting the names and other information of individuals from her employer to be used to file false tax returns. Floyd agreed to steal the names and then provide them to a co-conspirator. Most of the names stolen were of teenagers. Using the information provided by Floyd, her co-conspirators filed over 3,000 fraudulent federal income tax returns that claimed over $7.5 million in refunds.
A sentencing date has not been scheduled. Floyd faces a maximum sentence of ten years in prison for the conspiracy to defraud the United States count, and a mandatory sentence of two years in prison for aggravated identity theft. She is also subject to a fine of up to $250,000.00 in addition to restitution.
The case was investigated by special agents of the Internal Revenue Service - Criminal Investigation. Trial Attorney Michael Boteler of the Department's Tax Division and Assistant United States Attorney Todd Brown of U.S. Attorney’s Office for the Middle District of Alabama are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found at www.justice.gov/tax
PRESS CONTACT: Clark Morris
Email: [email protected]
Telephone: (334) 551-1755
Fax: (334) 223-7617Former Maryland Licensed Counselor Indicted for Sexually Exploiting an Infant in CaliforniaRead the Press Release
Federal Search Warrant for Email and Analysis of Cell Phone Lead to Charges for Abuse of Helpless Infant; Sent Videos and Images Using Messaging App
Baltimore, Maryland – A federal grand jury indicted Stephen H. Schaffner, age 34, of Greensboro, Maryland, yesterday on charges arising from the sexual abuse of a six week old baby who was born prematurely. The indictment alleges that Schaffner conspired with Michael Lutts, age 50, of San Diego, California, to abuse a six-week-old foster child and transmit recorded images and videos of the abuse to Schaffner. Lutts is facing federal charges in San Diego related to his conduct and the investigation is continuing.Anyone who may have information related to the investigation of Stephen Schaffner is asked to contact the FBI at 410-265-8080.
The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; United States Attorney for the Southern District of California Laura E. Duffy; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation - Maryland; Acting Special Agent in Charge Robert Howe of the Federal Bureau of Investigation – San Diego Division; Colonel Marcus L. Brown, Superintendent of the Maryland State Police; Chief Jeff A. Jackson of the Greensboro Police Department and Chief David A. Spencer of the Easton Police Department.“Thankfully, most technology companies continue to honor federal search warrants and most cellular phones can be searched with a warrant,” said U.S. Attorney Rod J. Rosenstein. “If telecommunications companies provide software and hardware that is immune from federal search warrants, pedophiles will be free to commit such egregious crimes with little risk of detection.”
According to the 10 count indictment, Schaffner was a licensed clinical professional counselor in Maryland until his license was suspended on June 14, 2014. Schaffner was also a licensed associate counselor in Arizona until his Arizona license expired in 2011.
The indictment alleges that Michael Lutts lived in San Diego, California and worked as a pediatric nurse at a hospital in San Diego County. Lutts was also a foster parent. On August 4, 2014, Lutts brought to his home a six week old baby boy, born prematurely, who was placed in his care as a foster child. That evening, Lutts, in California, texted Schaffner, in Maryland, images of the infant. Over the next several hours, Schaffner allegedly exchanged numerous graphic and sexually explicit messages with Lutts about Lutts engaging in sexually explicit conduct with the infant. Lutts sent Schaffner videos with the infant, including images of an adult performing oral sex on the infant. Schaffner is alleged to have directed Lutts to sexually abuse the infant in order to produce sexually explicit images and videos and send them to Shaffner.A criminal complaint filed in California alleges that authorities obtained a federal search warrant in April 2014 for an email address of a person who was distributing child pornography, which led them to other suspects who were transmitting child pornography. On August 26, 2014, authorities obtained a search warrant for Lutts’s residence and seized a cell phone that contained images and videos of Lutts allegedly sexually molesting the infant.
Schaffner faces a minimum mandatory sentence of 15 years in prison and a maximum of 30 years in prison for the conspiracy and for each of nine counts of sexually exploiting a child, followed by up to lifetime supervised release,. On October 1, 2014, Schaffner had his initial appearance in U.S. District Court in Baltimore and was detained.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
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.justice.gov/psc. For more information about internet safety education, please visit www.justice.gov/psc and click on the "resources" tab on the left of the page.
United States Attorney Rod J. Rosenstein commended the FBI’s Baltimore and San Diego offices, the Maryland State Police Interstate Crimes Against Children Task Force (ICAC), the San Diego, California ICAC, Greensboro Police Department, and Easton Police Department for their work in the investigation and prosecution. Mr. Rosenstein thanked Assistant U.S. Attorney Alessandra P. Serano from the Southern District of California who is prosecuting the case against Michael Lutts, and Assistant U.S. Attorney Zachary A. Myers from Maryland, who is prosecuting the case against Stephen Schaffner.Former HUD Employee Pleads Guilty to Federal Charge in Theft of $843,000 of Government MoneyDefendant Sold HUD Properties, Kept A Portion of the Proceeds for HimselfRead the Press Release
WASHINGTON – Brian E. Thompson, 53, a former loan guarantee specialist for the U.S. Department of Housing and Urban Development, pled guilty today to a charge stemming from a scheme in which he stole $843,000 of government money.
The plea was announced by U.S. Attorney Ronald C. Machen Jr., Gary R. Barksdale, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service, and Cary A. Rubenstein, Special Agent in Charge of the Mid-Atlantic Region of the Office of the Inspector General of the U.S. Department of Housing and Urban Development (HUD-OIG).
Thompson, of Washington, D.C., pled guilty in the U.S. District Court for the District of Columbia to one count of wire fraud. The Honorable Senior Judge Paul L. Friedman scheduled sentencing for Jan. 7, 2015. The charge carries a statutory maximum of 20 years in prison and potential financial penalties. Under federal sentencing guidelines, the parties have agreed that Thompson faces a likely range of 33 to 41 months in prison and a fine of up to $75,000. The plea agreement calls for Thompson to pay $843,000 in restitution to the federal government. He also is subject to a forfeiture money judgment in the amount of $645,700.
According to a statement of offense, signed by the defendant as well as the government, Thompson carried out his scheme from May 2013 until March 2014, while he was working for HUD’s Office of Loan Guarantee for Native American programs. This Office handles the reselling of properties that have been acquired by HUD after borrowers defaulted on their HUD-guaranteed mortgages. Thompson was a loan guarantee specialist. His duties included selling these HUD real estate owned properties for the best possible price in order to reimburse the government for the payments made to the mortgage lender for the insured loan. He advised supervisors of the progress of reselling properties, and he also coordinated with the title and escrow agents at settlements.
From June 2013 until March 2014, Thompson sold parcels of such real estate properties on behalf of HUD. For five of those parcels, he made materially false misrepresentations to third parties and diverted $843,000 of the sales proceeds to bank accounts under his control. In order to conceal these thefts from HUD, Thompson used and submitted fictitious settlement statements that falsely listed the buyer, and/or the contract sales prices, and/or the seller proceeds.
“Brian Thompson exploited his government job to rob the American taxpayer of more than $800,000,” said U.S. Attorney Machen. “This crooked HUD employee diverted the proceeds of real estate sales from the U.S. Treasury to his own pockets through lies and trickery. He now faces serious prison time as a result of criminal breach of the public trust.”
“Postal Inspectors are proud to join with our federal law enforcement partners at HUD-OIG to bring this case to a successful resolution,” said Inspector in Charge Barksdale. “By joining forces, we are able to bring justice to those who would misuse the U.S. mail in order to defraud the US government.”
“The United States Department of Housing and Urban Development, Office of the Inspector General is tasked with investigating allegations of waste, fraud, and abuse in HUD-sponsored programs,” said Special Agent in Charge Rubenstein. “When we learn of HUD employees who engage in fraud, and in this instance elect to enrich themselves at the expense of a HUD program designed to ensure that Native Americans are provided the American dream of home ownership, we vigorously investigate these allegations in order to bring the employees to justice and remove them from current and future employment with HUD and the Federal Government. We wish to thank our law enforcement partners at the U.S. Postal Inspection Service and United States Attorney’s Office for their steadfast efforts, hard work and dedication. This was a truly collaborative effort that led to the guilty plea earlier today.”
In announcing the plea, U.S. Attorney Machen, Inspector in Charge Barksdale, and Special Agent in Charge Rubenstein commended the work of those who investigated the case from the U.S. Postal Inspection Service and HUD’s Office of the Inspector General. They also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialist Kristy Penny, the Asset Forfeiture Section’s staff, and Assistant U.S. Attorneys Diane Lucas and Virginia Cheatham.
14-223Former Financial Advisor, Jabari Ragas, Sentenced to 42 Months for Money Laundering and Tax FraudRead the Press Release
U.S. Attorney Kenneth A. Polite announced that JABARI RAGAS, age 40, a resident of New Orleans, Louisiana, was sentenced today for one count of money laundering and one count of tax fraud. RAGAS previously pled guilty to embezzling nearly $1,700,000 from clients, and failing to pay nearly $260,000 in tax due and owing to the Internal Revenue Service.
U.S. District Judge Eldon E. Fallon sentenced RAGAS to serve 42 months of incarceration, to be followed by 3 years of supervised release. RAGAS was also ordered to pay nearly $1,700,000 in restitution for the money laundering count, and $259,210 for the tax fraud count.
According to court documents, RAGAS was employed by Ameriprise Financial Services, Inc. (“Ameriprise”) as a registered broker and investment adviser from 2005 - 2009. RAGAS previously pled guilty to embezzling nearly $1,400,000 from clients, and failing to pay nearly $260,000 in tax due and owing to the Internal Revenue Service.
In early 2006, a client of RAGAS indicated to him that he wished to open a Simplified Employee Pension (“SEP”) account to allow him to contribute towards retirement. The client made contributions from 2006 – 2009. Without authorization, RAGAS began moving money from the Ameriprise SEP account, into an account controlled by RAGAS. The client later checked the account balance and inquired as to why the account balance was lower than it should have been and was told by RAGAS that the funds had been transferred to a different financial institution located in Texas. RAGAS was later asked by the client to supply him with written account statements showing the balance, account number, and institution name. RAGAS then supplied the client with a fraudulent account statement for an account that did not exist, along with a fraudulent balance. After using the interstate wire to embezzle funds from the client’s Ameriprise account, RAGAS then committed money laundering by further transferring $20,000 into a different account that he controlled. Additionally, on October 12, 2008, RAGAS signed and filed a 2007 U.S. Individual Income Tax Return (Form 1040) with the Internal Revenue Service. The tax return allegedly did not report approximately $288,000 in income.
U.S. Attorney Polite stated, “Ragas defrauded the government out of tax revenue and his clients out of nearly $1.7 million in investments. Today’s sentence ensures that he pays for his fraudulent conduct by serving a lengthy prison sentence and paying full restitution to make his victims whole.”
U.S. Attorney Polite praised the work of the Internal Revenue Service and the United States Secret Service in investigating this matter. Assistant United States Attorney Jon Maestri is in charge of the prosecution.
Former Deputy Director of the Largest State Agency in Arkansas Pleads Guilty to Bribery SchemeRead the Press Release
A former deputy director of the Arkansas Department of Human Services (ADHS), a multi-billion dollar state agency, pleaded guilty today for providing official assistance in exchange for bribes from the owner of two mental health companies.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and First Assistant United States Attorney Patrick C. Harris of the Eastern District of Arkansas made the announcement.
Steven B. Jones, 49, of Marion, Arkansas, pleaded guilty to a two-count information charging him with conspiracy and bribery concerning programs receiving federal funds. A sentencing hearing is scheduled for April 2, 2015, before U.S. District Judge Billy Roy Wilson of the Eastern District of Arkansas.
According to his plea agreement, Jones served as deputy director of ADHS from approximately April 2007 until July 2013. While serving in that capacity, Jones solicited and accepted multiple cash payments and other things of value from the owner of two businesses that provided inpatient and outpatient mental health services to juveniles. This individual provided the cash payments and other things of value to Jones through the use of two intermediaries, a local pastor and a former county probation officer and city councilman.
As part of his plea, Jones admitted that in return for the bribes, he provided official assistance, including providing internal ADHS information about the individual’s businesses. Jones further admitted that he and other members of the conspiracy concealed their dealings by, among other things, holding meetings at restaurants in Memphis, Tennessee, or rural Arkansas, where they would not be easily recognized; funneling the cash payments through the pastor’s church; providing the bribe payments in cash so that the transactions would not be easily traceable; and speaking in code during telephone conversations.
The case was investigated by the FBI’s Little Rock Field Office, and is being prosecuted by Trial Attorney Edward P. Sullivan of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorneys Patricia S. Harris and Angela S. Jegley of the Eastern District of Arkansas.
Former Deputy Director of the Largest State Agency in Arkansas Pleads Guilty to Bribery SchemeRead the Press Release
Washington – A former deputy director of the Arkansas Department of Human Services (ADHS), a multi-billion dollar state agency, pleaded guilty today for providing official assistance in exchange for bribes from the owner of two mental health companies.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and First Assistant United States Attorney Patrick C. Harris of the Eastern District of Arkansas made the announcement.
Steven B. Jones, 49, of Marion, Arkansas, pleaded guilty to a two-count information charging him with conspiracy and bribery concerning programs receiving federal funds. A sentencing hearing is scheduled for April 2, 2015, before U.S. District Judge Billy Roy Wilson of the Eastern District of Arkansas.
According to his plea agreement, Jones served as deputy director of ADHS from approximately April 2007 until July 2013. While serving in that capacity, Jones solicited and accepted multiple cash payments and other things of value from the owner of two businesses that provided inpatient and outpatient mental health services to juveniles. This individual provided the cash payments and other things of value to Jones through the use of two intermediaries, a local pastor and a former county probation officer and city councilman.
As part of his plea, Jones admitted that in return for the bribes, he provided official assistance, including providing internal ADHS information about the individual’s businesses. Jones further admitted that he and other members of the conspiracy concealed their dealings by, among other things, holding meetings at restaurants in Memphis, Tennessee, or rural Arkansas, where they would not be easily recognized; funneling the cash payments through the pastor’s church; providing the bribe payments in cash so that the transactions would not be easily traceable; and speaking in code during telephone conversations.
The case was investigated by the FBI’s Little Rock Field Office, and is being prosecuted by Trial Attorney Edward P. Sullivan of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorneys Patricia S. Harris and Angela S. Jegley of the Eastern District of Arkansas.
Former Chief Information Officer of Foundry Networks Found Guilty in Manhattan Federal Court of Participating in Insider Trading Scheme That Reaped over Tens of Millions in Unlawful GainsRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that DAVID RILEY, former Chief Information Officer of Foundry Networks, Inc. (“Foundry”), a California-based technology company that was acquired by Brocade Communications, Inc. (“Brocade”), in 2008, was found guilty today of crimes related to his participation in an insider trading scheme that yielded over $27 million in ill-gotten gains. Following a 13-day trial conducted before U.S. District Judge Valerie E. Caproni, a jury found that RILEY passed inside information about Foundry’s acquisition by Brocade and about Foundry’s earnings for the first quarter of 2008 to Matthew Teeple, a former analyst for San Francisco-based hedge fund Artis Capital Management, L.P. (“Artis”). Teeple pled guilty to related charges on May 28, 2014.
Manhattan U.S. Attorney Preet Bharara said: “As the jury unanimously found, David Riley exploited his position and access to information at Foundry Networks, a publicly traded technology company. What Riley forged at Foundry was a pipeline of material, nonpublic information that enabled others to engage in illegal insider trading and reap a windfall of more than 27 million dollars. What Riley got out of the arrangement is a felony conviction and the prospect of losing his liberty. He becomes the 87th defendant convicted of insider trading after trial or by guilty plea in this District in the last five years.”
According to the Superseding Indictment filed February 20, 2014, other court documents, and the evidence presented at trial:
As CIO and a Vice President at Foundry, RILEY had access to monthly and quarterly financial reporting, along with other sensitive, nonpublic information (the “Inside Information”) relating to Foundry, well before such information became public. RILEY provided this Inside Information to Teeple – sometimes by telephone and sometimes during meetings the two arranged in the San Jose, California, area. On several occasions, RILEY spoke with Teeple while logged into the database that Foundry used to maintain sensitive financial information. The Inside Information that RILEY passed to Teeple included quarterly financial performance numbers during the first quarter of 2008 and information regarding Brocade’s intended acquisition of Foundry in July 2008.
Teeple passed the Inside Information he got from RILEY on to others, including others at Artis. From the Inside Information Teeple provided about Foundry, Artis ultimately reaped gains of over $27 million in 2008.
RILEY, 48, of San Jose, California, was convicted of one count of conspiracy to commit securities fraud and two counts of securities fraud. The conspiracy count carries a maximum sentence of five years in prison and a fine of the greater of $250,000 or twice the gross gain or loss from the offense. Each of the securities fraud counts carries a maximum sentence of 20 years in prison and a fine of $5 million or twice the gross gain or loss from the offense. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. RILEY is scheduled to be sentenced on February 6, 2015.
The jury was unable to reach a verdict with respect to the remaining count of the Superseding Indictment, which charged RILEY with substantive securities fraud related to passage of inside information concerning negative developments with the Brocade-Foundry deal on October 16, 2008.
Mr. Bharara praised the investigative work of the FBI and thanked the Securities and Exchange Commission, which has filed civil charges in a separate action.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Since the inception of FFETF in November 2009, the Justice Department has filed more than 12,841 financial fraud cases against nearly 18,737 defendants including nearly 3,500 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Telemachus P. Kasulis and Sarah E. McCallum, and Special Assistant U.S. Attorney Michael P. Holland, are in charge of the prosecution.
Former California News Helicopter Pilot SentencedRead the Press Release
SACRAMENTO, Calif. — John Michael Dial, 58, of Skaneateles, New York, was sentenced today by United States District Judge Morrison C. England Jr. to two years in prison for aggravated identity theft, United States Attorney Benjamin B. Wagner announced.
According to court documents, Dial used the names of actual persons to commit violations of federal law such as false statements to the FAA and forgery of a U.S. passport.
According to court documents:
- From December 16, 2009, to August 4, 2010, Dial was hired as a television news helicopter pilot and operated news helicopters in the Bay Area without a pilot’s license.
- Dial worked for an air ambulance service in Susanville and provided numerous false identification documents to his employer. From July 3, 2011, to November 7, 2011, he operated a helicopter approximately 63 times without having a valid pilot certificate.
- On March 15, 2012, Dial was hired to work as a television news helicopter pilot in Sacramento. Dial used his real name but the FAA certificates he provided were fraudulent. He flew two times without having a valid pilot certificate.
- Dial used the identity of a former co-worker to gain employment with an air ambulance service in New York, and he created a fraudulent United States passport using that person’s identity.
Dial’s identity theft became clear when he was stopped in Idaho for a traffic violation and produced falsified ID from Vermont. Dial pleaded guilty on July 31, 2014.
“The sentencing today of John Michael Dial for aggravated identity theft is a clear signal that the safety of the Nation’s air transportation system remains a high priority for both the Office of Inspector General and the Department of Transportation,” said William Swallow, DOT OIG regional Special Agent-In-Charge. “We will continue to work with our prosecutorial and law enforcement colleagues to prevent and detect violations of federal laws designed to ensure the safety of the public and the Nation’s transportation systems, and punish those who would seek to compromise that safety.”
“Dial stole identities, creating and forging numerous counterfeit documents to conceal his identity and criminal history as he moved from state to state to outrun his past. His crime presented a threat to public safety as his true identity and criminal history precluded him from obtaining access to aircraft and the certification necessary for employment as a commercial helicopter pilot,” said Special Agent in Charge Monica Miller of the FBI’s Sacramento field office. “Despite his efforts to evade law enforcement, Dial was pursued across numerous state lines and was ultimately apprehended in Skaneateles, New York.”
This case was the product of an investigation by the U.S. Department of Transportation, Office of Inspector General, the Federal Bureau of Investigation, and the United States Secret Service with the assistance of the Cascade, Idaho, and McCall, Idaho Police Departments. Assistant United States Attorneys Kyle Reardon and Andre Espinosa prosecuted the case.
Former Alabama State Employee Pleads Guilty to Stealing Identities from State Databases Used to Request over $7 Million in Tax RefundsRead the Press Release
Today, Tamika Floyd pleaded guilty to one count of conspiracy to defraud the United States and one count of aggravated identity theft for her involvement in a Stolen Identity Refund Fraud Scheme (SIRF), announced Deputy Assistant Attorney General Ronald A. Cimino for the Justice Department's Tax Division and U.S. Attorney George L. Beck Jr. for the Middle District of Alabama.
According to the court documents, between 2006 and 2014, Floyd worked at the State of Alabama Department of Public Health and the Alabama Department of Human Resources, both located in Opelika, Alabama. At both jobs, she had access to the identification information of individuals. Beginning in 2012, Floyd was approached to obtain names from her employer that would be used to file false tax returns. Floyd agreed to steal the names and in turn provided them to her co-conspirator. Most of the names stolen belonged to teenagers. Floyd’s co-conspirators used the names she provided to file more than 3,000 fraudulent federal income tax returns that claimed more than $7.5 million in refunds.
A sentencing date has not been scheduled.
The case was investigated by special agents of the Internal Revenue Service - Criminal Investigation. Trial Attorney Michael Boteler of the Tax Division and Assistant U.S. Attorney Todd Brown for the Middle District of Alabama are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found at the division's website.