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Wednesday 1 October 2014
Pawtucket Drug Trafficker Sentenced to Federal Prison on Drug and Firearm ChargesRead the Press Release
PROVIDENCE, R.I. – Graviel Santos, 32, of Pawtucket, was sentenced on Wednesday to 84 months in federal prison on drug trafficking and firearm charges, announced United States Attorney Peter F. Neronha and Pawtucket Police Chief Paul King.
At sentencing, U.S. District Court Judge Mary M. Lisi also ordered Santos to serve three years’ supervised release upon completion of his prison term and to pay a fine of $1,000. Santos pleaded guilty in April 2014 to one count each of possession of heroin with the intent to distribute, possession of crack cocaine and being a felon in possession of a firearm.
According to information presented to the court by the government at the time of Santos’ guilty plea, in November 2013, members of the Pawtucket Police Special Squad completed an investigation into drug trafficking activities from an apartment where Santos and his girlfriend resided. Detectives conducted a court authorized search of the apartment on November 4, 2013, during which time they seized nearly 25 grams of heroin, 3 grams of crack cocaine, a loaded .45 caliber handgun and numerous items used in the packaging and distribution of illegal drugs.
The firearm was located inside a bin containing men’s clothing, within easy reach of the defendant who was lying on a couch when detectives entered the apartment.
According to information presented to the court, the defendant previously was convicted in Rhode Island state court on drug and domestic violence charges.
Santos has been detained since his arrest on November 4, 2013.
The case was prosecuted by Assistant U.S. Attorney Pamela E. Chin.
ATF and DEA agents assisted Pawtucket detectives in the investigation of this matter.
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To assist the media and the public, a glossary of federal judicial terms and procedures is available at http://www.justice.gov/usao/justice101/
Contact: 401-709-5357
[email protected]Pamela Smith Imprisoned for Woodstock Inn EmbezzlementRead the Press Release
The Office of the United States Attorney for the District of Vermont stated that Pamela Smith, 58, of Barnard, was sentenced on September 22, 2014 in United States District Court in Brattleboro to 15 months of imprisonment following her guilty plea to a charge of wire fraud. U.S. District Judge J. Garvan Murtha ordered that Smith serve a three-year term of supervised release following completion of her prison term and pay restitution in the amount of $228,675. The court directed Smith to surrender to the Bureau of Prisons on October 28 to begin serving her sentence.
On February 18, 2014, the United States Attorney filed a one-count information charging
Smith with wire fraud. According to the information, between approximately 2007 and early 2013, Smith was employed by the Shire Riverview Motel in Woodstock, Vermont. Smith worked part-time as a clerk and also performed bookkeeping services for the inn. Beginning no later than 2009 and continuing until early 2013, Smith embezzled not less than $210,000 from Shire Riverview. She did this by writing unauthorized checks to herself from the inn's checking account, then depositing the checks into her personal bank account; by stealing cash payments made by motel guests; and by using Shire Riverview funds to pay her personal expenses, including credit card, gasoline, fuel oil and telephone and Internet service bills. Smith used about $40,000 in stolen funds to pay for improvements to a house in Barnard.As part of her plea, Smith agreed to forfeit to the United States about $40,000 in improvements to the Barnard residence. At the time of sentencing Smith had already repaid the victim about $121,000.
This case was investigated by the Woodstock Police Department and the Federal Bureau of Investigation.
Smith is represented by George Ostler and Cabot Teachout. The prosecutor is Assistant U.S. Attorney Gregory Waples.
Oglala Man Sentenced for Simple AssaultRead the Press Release
United States Attorney Brendan V. Johnson announced that an Oglala, South Dakota, man convicted of Simple Assault was sentenced on September 25, 2014, by U.S. Magistrate Judge Veronica L. Duffy.
Leon Eagle, age 21, was sentenced to 6 months of probation and ordered to pay a $10 special assessment to the Federal Crime Victims Fund.
Eagle was indicted for Felony Child Abuse and Neglect by a federal grand jury on March 18, 2014. He pled guilty to Simple Assault on July 10, 2014.
The conviction relates to an incident at Oglala in September of 2012, when Eagle was in an argument with some people and knocked the one-year-old victim to the ground.
This case was investigated by the Bureau of Indian Affairs, Office of Justice Services, and the Oglala Sioux Tribe Department of Public Safety. Assistant U.S. Attorney Eric Kelderman prosecuted the case.
Norfolk Man Sentenced to 54 Months for Wire Fraud and False ClaimsRead the Press Release
NORFOLK, Va. –Travis Hager, 24, of Norfolk, Virginia, was sentenced today to 54 months in prison, followed by five years of supervised release, following his guilty plea on June 4, 2014, for wire fraud and false claims against the United States.
Dana J. Boente, United States Attorney for the Eastern District of Virginia and Thomas J. Kelly, Special Agent in Charge, Washington D.C. Field Office, IRS-Criminal Investigations, made the announcement after sentencing by U.S. District Judge Raymond A. Jackson.
According to court documents, Travis Hager, along with his co-conspirator Donte Demus, stole the identities of individuals and used them to file false federal income tax returns. While incarcerated in a Virginia Beach jail, Hager stole the identities of a number of fellow inmates and provided them to Demus by using the jail’s phone system. Demus then provided the identities to a third unidentified accomplice who filed the false returns. The conspirators would request the tax refund be loaded on a prepaid debit card and mailed to Norfolk, Virginia where Demus would retrieve them and spend the funds. In total, Hager, Demus, and their accomplice claimed fraudulent tax refunds from the U.S. Government in the amount of $163,953.
Donte Demus pleaded guilty on September 3, 2014 and is scheduled to be sentenced on December 4, 2014.
This case was investigated by Internal Revenue Service-Criminal Investigations. Assistant U.S. Attorney Joseph Kosky prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:14-cr-43.
New York Man Imprisoned 69 Months for Heroin TraffickingRead the Press Release
The Office of the United States Attorney for the District of Vermont stated that on September 29, 2014, Devon Cruz, 29, of New York, was sentenced by Chief United States District Judge Christina Reiss to sixty-nine months imprisonment on his guilty plea to a charge of conspiracy to distribute 100 grams or more of heroin. Chief Judge Reiss also ordered that Hercules serve four years on supervised release after his incarceration ends.
According to court documents, Cruz, along with Joshua Rose, 21, and Charles Hercules, 23, both of New York, trafficked approximately one kilogram of heroin from New York to Rutland from early 2012 to February 2013. The three New York men sold the heroin in Rutland primarily through several heroin-addicted local residents, including Alan H. Willis, II, 42, of Tinmouth, and Evan Murphy, 23, of Rutland. During a joint investigation by the Vermont Drug Task Force (VDTF), the Drug Enforcement Administration (DEA), and the Federal Bureau of Investigation (FBI), investigators used confidential informants to make controlled buys of the heroin from Willis and Murphy in the Rutland area.
On July 24, 2013, a grand jury returned an indictment charging Cruz, Rose, Hercules, Willis, Murphy, and Jean Marie Phillips, 47, of Rutland, with conspiracy to distribute 100 grams or more of heroin. All of the defendants have entered guilty pleas to the conspiracy charge, except Phillips, who pled guilty to aiding and abetting Rose=s possession with intent to distribute heroin. On April 28, 2014, Willis was sentenced to 37 months imprisonment. On May 9, 2014, Phillips was sentenced to 13 months imprisonment. On August 26, 2014, Murphy was sentenced to 60 months imprisonment. On August 27, 2014, Hercules was sentenced to 39 months imprisonment. Rose is scheduled for sentencing on October 30.
United States Attorney Tristram J. Coffin commended the joint investigation by the VDTF, DEA and FBI, and thanked the Vermont Attorney General=s Office for its cooperation. Burlington attorney Richard Bothfeld represented Cruz. The case is being prosecuted by Assistant U.S. Attorney Craig S. Nolan.
Nenahnezad Man Sentenced to Prison for Federal Arson ConvictionRead the Press Release
ALBUQUERQUE – Gregory Bitsilly, 28, an enrolled member of the Navajo Nation who resides in Nenahnezad, N.M., was sentenced this afternoon to 24 months in federal prison followed by five years of supervised release for his arson conviction.
Bitsilly was arrested in March 2014, on a criminal complaint charging him with arson. He was indicted on that same charge in April 2014. According to court filings, Bitsilly set fire to the residence he shared with his wife and children on March 24, 2014, because his wife was attempting to leave him for being physically abusive. The residence and its contents were a total loss.
On June 25, 2014, Bitsilly admitted willfully and maliciously setting fire to the home he resided in with his wife and children on March 24, 2014.
This case was investigated by the Farmington office of the FBI and the Shiprock office of the Navajo Nation Division of Public Safety and was prosecuted by Special Assistant U.S. Attorney David Adams.
The case was brought pursuant to the Tribal Special Assistant U.S. Attorney (Tribal SAUSA) Pilot Project in the District of New Mexico which is sponsored by the Justice Department’s Office on Violence Against Women under a grant administered by the Pueblo of Laguna. The Tribal SAUSA Pilot Project seeks to train tribal prosecutors in federal law, procedure and investigative techniques to increase the likelihood that every viable violent offense against Native women is prosecuted in either federal court or tribal court, or both. The Tribal SAUSA Pilot Project was largely driven by input gathered from annual tribal consultations on violence against women, and is another step in the Justice Department's on-going efforts to increase engagement, coordination and action on public safety in tribal communities.
National Institute of Justice Invests $63 Million to Support School Safety Research, Arizona Awarded $4,999,442Read the Press Release
PHOENIX – The Office of Justice Programs’ National Institute of Justice (NIJ) today announced it has awarded nearly $63 million to school districts and research organizations through the Comprehensive School Safety Initiative (CSSI). CSSI is a large-scale, multi-agency research effort to build knowledge about effective approaches to increasing school safety nationwide.
Through the Initiative, 24 research projects receive funding under two different solicitations. The first, “Investigator-Initiated Research,” includes nine awards to research organizations totaling more than $18 million. The second, “Developing Knowledge about What Works to Make Schools Safe,” provides more than $45 million to 15 school districts and their research partners.
“We are proud that within our District, the University of Arizona, in partnership with the Arizona Department of Education, has been selected to research and evaluate the impact and effectiveness of the school resource officer (SRO) training and activities,” said U.S. Attorney John S. Leonardo, “This evaluation of the role of those in the SRO positions will be directed to 45 overall schools around the state in an effort to determine the most effective way to enhance the school safety of our students.”
“We know a great deal about how to make schools safe in general but very little about the specifics for various settings and populations,” said Dr. William J. Sabol, Acting Director of NIJ. “With this $63 million investment, the nation will gain an understanding of school safety that is scientifically sound, practical, and that can be easily interpreted and used by schools.”
President Obama’s January 2013 plan to end gun violence emphasized keeping guns out of potentially dangerous hands and recognized that additional actions are needed to make our schools safer. CSSI was launched in early 2014 in response to a Congressional request for a broad, research-based effort to increase safety in the nation’s schools.
The initiative has three primary goals: to collect national-level data; to convene stakeholders to identify and share best practices; and to conduct innovative research and evaluate pilot projects in school districts. The programs and policies within CSSI are designed to produce evidence about what works in such areas of school safety as effectiveness of school resource officers and mental health professionals, violence and bullying reduction, and effectiveness of such restorative justice interventions as youth courts. The initiative will also examine potential unintended consequences of school safety efforts, including the excessive use of exclusionary discipline and arrests of students.Although NIJ has primary responsibility for CSSI, the program is a collaborative effort among more than 20 federal partners, including the Departments of Justice, Education, Health and Human Services, Homeland Security, and the Treasury. This partnership will allow the federal government to make a significant impact on school safety by investing limited funds in research that has practical applications for every school in the nation. By determining what interventions work best for specific schools and students, CSSI will provide professionals with a body of knowledge to help them make decisions about which programs will be most effective — and most cost effective — for their particular schools and their challenges.
A list of the awards and more information about CSSI are available at www.nij.gov, keywords: “School Safety.”
For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.National Institute of Justice Awards Nearly $2 Million to Baltimore County Public Schools to Support School Safety ResearchRead the Press Release
Baltimore – The Office of Justice Programs’ National Institute of Justice (NIJ) today announced it has awarded the Baltimore County Public Schools and its research partner, the University of Maryland at Baltimore, $1,965,158 to study school safety by focusing on students with emotional and behavioral health issues. NIJ received more than 100 applications from school districts and their research partners around the country, and made 15 awards to the highest scoring, most relevant and rigorous studies.Schools across the country are struggling with how to formulate comprehensive and effective programs to address the mental health needs of students and thereby help preserve school safety. The study in Baltimore, known as “Promoting School Safety: A Comprehensive Emotional and Behavioral Health Model,” will employ a randomized controlled study design involving 44 schools to evaluate the impact of a new comprehensive emotional and behavioral health crisis response and prevention (EBH-CRP) intervention on school safety. This project will build on existing school and community resources to implement a streamlined emotional and behavioral health crisis response and prevention protocol and comprehensive continuum of services, including universal prevention, early identification, assessment and service linkage, crisis response and post-crisis relapse prevention. The research conducted by the University of Maryland at Baltimore will generate evidence about the effectiveness of a large-scale, multifaceted, mental-health-focused intervention.
Nationally, NIJ awarded nearly $63 million to school districts and research organizations through the Comprehensive School Safety Initiative (CSSI) to fund 24 research projects under two different solicitations. The first, “Investigator-Initiated Research,” includes nine awards to research organizations totaling more than $18 million. The Baltimore County Schools was awarded money under the second solicitation, “Developing Knowledge about What Works to Make Schools Safe,” under which NIJ provided more than $45 million to 15 school districts and their research partners. CSSI is a large-scale, multi-agency research effort to build knowledge about effective approaches to increasing school safety nationwide.
“We know a great deal about how to make schools safe in general but very little about the specifics for various settings and populations,” said Dr. William J. Sabol, Acting Director of NIJ. “With this $63 million investment, the nation will gain an understanding of school safety that is scientifically sound, practical, and that can be easily interpreted and used by schools.”
President Obama’s January 2013 plan to end gun violence emphasized keeping guns out of potentially dangerous hands and recognized that additional actions are needed to make our schools safer. CSSI was launched in early 2014 in response to a Congressional request for a broad, research-based effort to increase safety in the nation’s schools.
The initiative has three primary goals: to collect national-level data; to convene stakeholders to identify and share best practices; and to conduct innovative research and evaluate pilot projects in school districts. The programs and policies within CSSI are designed to produce evidence about what works in such areas of school safety as effectiveness of school resource officers and mental health professionals, violence and bullying reduction, and effectiveness of such restorative justice interventions as youth courts. The initiative will also examine potential unintended consequences of school safety efforts, including the excessive use of exclusionary discipline and arrests of students.
Although NIJ has primary responsibility for CSSI, the program is a collaborative effort among more than 20 federal partners, including the Departments of Justice, Education, Health and Human Services, Homeland Security, and the Treasury. This partnership will allow the federal government to make a significant impact on school safety by investing limited funds in research that has practical applications for every school in the nation. By determining what interventions work best for specific schools and students, CSSI will provide professionals with a body of knowledge to help them make decisions about which programs will be most effective — and most cost effective — for their particular schools and their challenges.
A list of the awards and more information about CSSI are available at www.nij.gov, keywords: “School Safety.”
Member of N.J. Army National Guard Arrested for Alleged Sexual AbuseRead the Press Release
TRENTON, N.J. – A Hunterdon County, New Jersey, man was arrested at his home by U.S. Marshals this morning on a charge that he allegedly sexually abused a woman at Joint Base McGuire-Dix-Lakehurst, U.S. Attorney Paul J. Fishman announced.
Ioannis V. Karazoupis, 27, of Flemington, New Jersey, a member of the N.J. Army National Guard, is charged by indictment with sexual abuse. He is scheduled to appear this afternoon before U.S. Magistrate Judge Lois H. Goodman in Trenton federal court.
According to the indictment:
On May 4, 2014, Karazoupis engaged in a sexual act with a person who at the time was incapable of appraising the nature of the conduct and was physically incapable of declining participation and communicating unwillingness to engage in a sexual act. At the time of the alleged offense, Karazoupis’ National Guard unit was at Joint Base McGuire-Dix-Lakehurst for training.
The sexual abuse charge with which Karazoupis is charged carries a maximum potential penalty of life in prison and a $250,000 fine.
U.S. Attorney Fishman credited special agents of the U.S. Army Criminal Investigation Command, under the leadership of Special Agent in Charge John P. Gueli, with the investigation leading to the indictment.
The government is represented by Assistant U.S. Attorney Fabiana Pierre-Louis of the U.S. Attorney’s Office Criminal Division in Trenton.
The charges and allegations contained in the indictment are merely accusations and the defendant is considered innocent unless and until proven guilty.
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Defense counsel: Jerome A. Ballarotto Esq., Trenton, N.J.
Karazoupis, Ioannis Indictment
Mason City Mother and Son Charged with Conspiracy to Make and Distribute MethamphetamineRead the Press Release
Peoria, Ill. – A Mason City, Ill., woman, Denise A. Taylor, 42, of the 400 block of S. Keefer Street, appeared in federal court today in Peoria, as announced by Jim Lewis, U.S. Attorney for the Central District of Illinois. Taylor was arrested yesterday on the indictment returned by the grand jury last week but sealed pending her arrest and court appearance. The indictment charges Taylor and her son, Brendin L. Williams, 23, with one count of conspiracy to manufacture and distribute more than 500 grams of methamphetamine from 2010 to the present. Williams is currently in the custody of the Illinois Department of Corrections and is expected to make his initial appearance in federal court on Oct. 9, 2014.
U.S. Magistrate Judge Jonathan E. Hawley ordered that Taylor be detained in the custody of the U.S. Marshals service and set the case for detention hearing on Oct. 9, at 1:00 p.m. Trial is scheduled on Dec. 1, 2014, before U.S. District Judge Michael M. Mihm.Taylor’s boyfriend, Teddy Lee, Jr., 25, also of the 400 block of S. Keefer Street, Mason City, is tentatively scheduled for trial on Oct. 14, 2014. The grand jury charged Lee in late July with participating in a conspiracy to manufacture more than 50 grams of meth, possession of a firearm by a felon, and possession of a stolen firearm. Lee was ordered to remain in the custody of the U.S. Marshals Service pending trial.
“Law enforcement is on the front line, protecting the community from people who make and distribute methamphetamine,” said U.S. Attorney Lewis. “We appreciate this opportunity to work with law enforcement and protect this community.”
“This is yet another example of superb cooperation by the Mason County Sheriff’s Office with the investigators of ‘Operation Copperhead’ and the U.S. Attorney’s Office,” said Mason County Sheriff Paul Gann. “These defendants now face federal charges related to the manufacture of methamphetamine, but we’re not done yet.”
The cases are being prosecuted by Assistant U.S. Attorney K. Tate Chambers in coordination with the Mason County State’s Attorney’s Office. The charges are the result of an ongoing investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Mason County Sheriff’s Office; the Tazewell County Sheriff’s Office; and, the Pekin Police Department.
Members of the public are reminded that an indictment is merely an accusation; the defendants are presumed innocent unless proven guilty.If convicted, the statutory maximum penalty for conspiracy to manufacture methamphetamine, if the defendant has no prior felony drug convictions, is 10 years to life in prison and fines of up to $4,000,000. With one prior felony drug conviction, the penalty increases to 20 years to life in prison and fines of up to $8,000,000; with two or more prior felony drug convictions, the penalty is life in prison. The maximum penalty for the offenses of felon in possession of a firearm and possession of a stolen firearm is 10 years in prison and a fine of $250,000.
Manhattan U.S. Attorney Announces Arrest of Former NYPD Officer for Fraudulently Obtaining Disability BenefitsRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and Edward J. Ryan, the Special Agent in Charge of the United States Social Security Administration, Office of the Inspector General, announced that JAMES CARSON, a former New York City Police Department (“NYPD”) officer, was arrested today for a scheme to fraudulently obtain disability benefits from the Social Security Administration (“SSA”). CARSON allegedly claimed to the SSA that he was unemployed since 1990 and could not work due to disability. However, since at least 2004, at the same time he was collecting disability benefits, he was working full time as the Director of Security for an international watchmaker and luxury watch retailer headquartered in New York, New York (the “Company”). CARSON was arrested earlier this morning at his residence in Yorktown, New York, and will be presented later today in Manhattan federal court before U.S. Magistrate Judge Andrew J. Peck.
Manhattan U.S. Attorney Preet Bharara said: “Not only did James Carson allegedly tell a series of lies to pocket disability benefits to which he was not entitled, but he then took sophisticated steps to conceal his fraudulently obtained income from the Social Security Administration. I would like to thank the Social Security Administration, Office of the Inspector General, for their work in bringing Carson’s alleged scheme to its proper end.”
Special Agent in Charge Edward J. Ryan said: “The investigation outlined in this criminal complaint demonstrates just one of the many actions our office is taking on a daily basis to ensure that the Social Security Disability Insurance Trust Fund is preserved for its intended purpose, providing a safety-net for the truly disabled, not lining the pockets of scammers and thieves. As always, it is particularly troubling when these types of crimes are committed by individuals who were once entrusted with upholding the law, and who are already receiving generous tax-payer financed pensions. Our office greatly appreciates the continued support and the priority given to these cases by the United States Attorney’s Office for the Southern District of New York.”
According to the allegations contained in the Complaint unsealed today:
In approximately 1990, CARSON left his job as a police officer with the NYPD due to a back injury and began receiving Social Security Disability Insurance (“SSD”). This disability benefit is only available to individuals who have a qualifying disability and are unable to work in any profession.
On multiple forms submitted to the SSA, CARSON claimed that he could not work due to a herniated disc and that he had not earned any income since 1990, when he began receiving SSD benefits. For example, in April 2014, CARSON reported to an SSA office for an interview related to his continued receipt of SSD benefits and filled out forms stating, among other things, that he: had not worked since leaving the NYPD in 1990; had “no other income” during that time; and had done “no work at all since my disability began.” CARSON further claimed that his typical day consisted of the following: “[I g]et out of bed. I have breakfast, I walk around backyard [and] deck. Wait for wife to come home from work. I lay down a lot. I rely on my wife to go places – she drives mostly.” In another form also submitted to the SSA that day, CARSON stated that “[m]y wife has to do the driving,” and that he could not drive due to “severe pain [and] weakness.” In response to a question asking about places he goes on a regular basis, CARSON claimed, “I don’t really go anywhere on a regular basis.” When CARSON attended the SSA interview in April 2014, he was limping and walking with a cane, and claimed in written forms that he always uses a cane.
In fact, since at least 2004, CARSON allegedly has been working full time as the Director of Security at the Company – an international watchmaker and luxury watch retailer. CARSON has been observed on multiple occasions driving to and from work, walking up stairs without difficulty, and walking without a cane. Further, EZ Pass records show that CARSON frequently travels back and forth between his residence and his office, typically at around 8:00 a.m. and 5:00 p.m. In 2010, CARSON received the Loss Prevention Case of the Year Award from the National Retail Federation for his role in an investigation into credit card schemes targeting the Company.
In order to prevent the SSA from discovering that he was gainfully employed while claiming to be unemployed due to a disability, CARSON took steps to conceal the income he was receiving from the Company. Rather than get paid directly by the Company, CARSON arranged for his compensation to be paid first to a corporation associated with his relative, and then paid from that corporation to CARSON’s relative as purported wages. Since 2004, CARSON has collected approximately $306,431 in disability benefits.
CARSON, 50, of Yorktown, New York, is charged with one count of theft of government property, which carries a maximum sentence of 10 years in prison, one count of making false statements, which carries a maximum sentence of five years in prison, and one count of failing to report income, which carries a maximum sentence of five years in prison. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Bharara praised the outstanding investigative work of the United States Social Security Administration, Office of the Inspector General.
The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Special Assistant United States Attorney Daniel Tracer is in charge of the prosecution.
The charges contained in the Complaint are merely accusations. The defendant is presumed innocent unless and until proven guilty.
U.S. v. James Carson Complaint
Licensed Clinical Social Worker Pleads Guilty to Defrauding Insurance CompaniesRead the Press Release
Buffalo, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that Eugene Domenico, 61, of Lockport, NY, pleaded guilty to three counts of theft from a health care benefit program, before Chief U.S. District Judge William M. Skretny. The charges carry a maximum penalty of three years in prison and a fine of $100,000 or both.
Assistant U.S. Attorney Michael DiGiacomo, who is handling the case, stated that the defendant, a licensed clinical social worker in private practice, devised a scheme to charge various health care insurance providers, including Blue Cross Blue Shield, for services that were not rendered. For example, Domenico billed Blue Cross Blue Shield for services allegedly provided to a patient on January 6, 2011, knowing that services were never provided. The total loss to insurance companies was $100,286.35.
“As we said earlier this week, fraud in the health care industry drives up costs for the rest of the public,” said U.S. Attorney Hochul. “This second conviction in less than a week demonstrates that our Office will continue to vigorously prosecute this type of fraud.”
Sentencing is scheduled for February 4, 2015, at 9:00 a.m. before Judge Skretny.
The plea is the culmination of an investigation by the Federal Bureau of Investigation’s Health Care Fraud Task Force.Leader and Organizer of $49.6 Million Mortgage Fraud Scheme Sentenced to 27 Years and Three Months in PrisonRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Fred W. Gibson, Principal Deputy Inspector General, Federal Deposit Insurance Corporation, Office of Inspector General (FDIC-OIG), Atlanta Regional Office, announce that Domenico “Dom” Rabuffo, 78, of Miami, was sentenced by Chief United States District Judge K. Michael Moore for his role as a leader and organizer of a $49.6 million bank fraud and wire scheme, perpetrated from approximately 2003 through 2008. Domenico Rabuffo was sentenced to 27 years and three months in prison for his role in the fraud scheme.
On July 3, 2014, Domenico Rabuffo and three co-defendants, Mae Rabuffo, 75, of New York, Raymond E. “Ray” Olivier, 52, of Land O’ Lakes, Florida, and Curtis Allen Davis, 52, of Tampa, were convicted of conspiracy to commit bank fraud and wire fraud after an 11 day-jury trial before Chief Judge Moore. Domenico Rabuffo, Olivier, and Davis were also convicted of various bank fraud offenses.
According to the indictment and evidence at trial, from 2003 to 2008, Rabuffo and his co-defendants conspired to perpetrate a complex $49.6 million mortgage fraud scheme against various FDIC-insured lenders, including Bank of America, Regions Bank, SunTrust Bank, and Wachovia Bank. Rabuffo and his ex-wife Mae Rabuffo used shell companies to acquire ownership and control of a purported residential property development known as Hampton Springs, located in Cashiers, North Carolina. Then, Rabuffo, Olivier, and Davis recruited numerous straw borrowers to purchase building lots in the development. Several of the straw borrowers testified at the trial. According to their testimony and other evidence, Domenico Rabuffo paid the borrowers to obtain lot purchase loans and construction loans for building lots in Hampton Springs. To obtain the loans, Domenico Rabuffo, Mae Rabuffo, Olivier, Davis, and other conspirators, submitted fraudulent loan applications and related documents to the lenders and the lenders’ closing agents.
Among other things, the loan applications and settlement statements for the lot loans contained fraudulent statements that the borrowers paid earnest money deposits and cash due at the closing. In fact, the deposits and cash-to-close were paid by Domenico Rabuffo and Mae Rabuffo using proceeds from the fraudulent scheme. Further, Domenico Rabuffo and Mae Rabuffo sent fraudulent correspondence to the closing agents, including letters bearing the forged signatures of borrowers, to create the false impression that the deposits and cash due at closing had been supplied by the borrowers from their own funds.
Olivier and Davis recruited straw borrowers for the fraud scheme and submitted fraudulent loan applications to the lenders. Further, Olivier and Davis caused their private companies to be disclosed as the employers of straw borrowers whose actual employment was inconsistent with the inflated income stated on their loan applications. Then, when they were contacted by the lenders, Olivier and Davis provided fraudulent verifications of employment for those borrowers.
Mae Rabuffo, Davis, and Olivier are scheduled to be sentenced on October 30, 2014, also before Chief Judge Moore.
Three other defendants, Diane M. Hayduk, 64, of Miami, Victor Miguel Vidal, 49, of Miami, and Lazaro Jesus Perez, 44, of Miami Springs, pled guilty to the charged conspiracy and agreed to assist the United States. Hayduk assisted Domenico Rabuffo and Mae Rabuffo with the misappropriation of loan proceeds and the transmission of fraudulent correspondence to the lenders and the closing agents. Vidal served as a loan officer at SunTrust Mortgage, where he sponsored fraudulent loan applications for lots in Hampton Springs, including fraudulent applications for $33 million in construction loans. Perez furnished fictitious accountant’s letters to Vidal, in support of fraudulent loan applications submitted to SunTrust Mortgage. Hayduk, Vidal, and Perez were sentenced in September, 2014. Hayduk was sentenced to 40 months in prison, Vidal was sentenced to 64 months in prison and Perez was sentenced to 30 months in prison.
Mr. Ferrer commended the investigative efforts of the FBI and FDIC-OIG. This case was prosecuted by Assistant United States Attorneys Dwayne E. Williams and Jerrob Duffy.
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.
Lawrenceville Tax Return Preparer Sentenced for Filing False Tax ReturnsRead the Press Release
ATLANTA - Laura Romina Delgado has been sentenced for filing false tax returns that claimed over $3.6 million in fraudulent refunds.
“Honest, hard-working taxpayers who file their tax returns and pay their fair share of taxes should be assured that those who try to profit by filing false returns will be prosecuted to the fullest extent of the law,” said United States Attorney Sally Quillian Yates.
“The sole objective of Ms. Delgado’s scheme was to unjustly enrich herself at the expense of the IRS,” stated Veronica F. Hyman-Pillot, Special Agent in Charge, IRS Criminal Investigation. “We will continue to pursue individuals like Delgado, who abuse positions of trust to commit crimes and ruin the lives of innocent citizens by misusing their identities.”
According to United States Attorney Yates, the charges, and other information presented in court: Delgado operated a business named Servicios Hispanos in Norcross, Ga., which offered various financial and legal services, mainly to members of the Hispanic community. Between January 2013 and May 2014, Delgado electronically filed approximately 1,300 federal income tax returns, claiming over $3.6 million in fraudulent refunds.
Many of the fraudulent returns filed by Delgado were in the names of individuals who were not documented to work in the United States. In some instances, she assisted these individuals in obtaining Individual Tax Identification Numbers (ITINs) from the IRS to facilitate the fraud. Delgado also submitted false and misleading W-2 forms with the returns she filed and assisted in negotiating U.S. Treasury checks representing the proceeds of the fraud. She also notarized and filed fraudulent ITIN applications.
Delgado, 33, of Lawrenceville, Ga., was sentenced to four years, three months in prison, to be followed by three years of supervised release. She was ordered to pay restitution in the amount of $2,148,440, and a special assessment of $100. Delgado was convicted on these charges on July 7, 2014, after she pleaded guilty to a criminal indictment charging her with wire fraud.
This case was investigated by the Internal Revenue Service Criminal Investigation and the Drug Enforcement Administration.
Assistant United States Attorneys J. Russell Phillips and Michael Brown prosecuted the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao/gan/.
Latrobe Postal Service Employee Sentenced to Prison, Ordered to Pay Restitiution for Stealing Money Orders and CashRead the Press Release
PITTSBURGH – A former Postal Service employee was sentenced today in federal court to six months imprisonment, three years supervised release and restitution of $55,362.90 on her conviction of misappropriation of postal funds by a postal employee, United States Attorney David J. Hickton announced today.
Senior United States District Judge Maurice B. Cohill imposed sentence upon Jessica L. Croyle, of Greensburg, Pa.
According to information presented to the court, from Nov. 1, 2012, to July 19, 2013, Croyle, while employed with the United States Postal Service at the Latrobe, Pennsylvania Post Office, wrongfully converted to her own use, postal money orders and cash having a total value of $55,362.90.
Assistant United States Attorney Mary McKeen Houghton prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the United States Postal Service, Office of Inspector General, for the investigation that led to the successful prosecution of Croyle.
Justice Department Sues to Stop Tennessee Man from Preparing Tax ReturnsRead the Press Release
The United States filed a civil injunction suit against a Hixson, Tennessee, man to enjoin him from preparing federal income tax returns for others, the Justice Department announced today.
According to the complaint filed in the U.S. District Court for the Eastern District of Tennessee, Kevin Walker is alleged to have prepared federal income tax returns for his customers with fake businesses; reported false profits, losses and expenses; improperly claimed false employee business expenses and falsely claimed the Earned Income Tax Credit and education-related tax credits. According to the complaint, two returns prepared over a two-year period for one customer claimed bogus receipts, but no expenses, from a fictitious business so as to maximize tax refunds based on the Earned Income Tax Credit. As a result, the customer erroneously received income tax refunds of more than $6,000 for the two years. The Internal Revenue Service (IRS) estimates that Walker’s activities over the last five years have cost the U.S. Treasury as much as hundreds of thousands of dollars in lost income tax revenue.
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams for 2014. The IRS has some tips on their website for choosing a tax preparer. In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Related Materials:
United States v. Kevin M. Walker
Complaint for Preliminary and Permanent InjunctionJury Convicts Gang Member in South Francisco Triple HomicidesRead the Press Release
SAN FRANCISCO – Victor Flores, Benjamin Campos-Gonzalez, and Armando Acosta were convicted of racketeering conspiracy by a federal jury yesterday, announced United States Attorney Melinda Haag, Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Acting Special Agent in Charge Tatum King, and FBI Special Agent in Charge David J. Johnson.
In addition, the jury also convicted Flores of three counts of racketeering murder and four counts of racketeering attempted murder for his involvement in a Dec. 22, 2010, shooting in South San Francisco, Calif., as well as the attempted murder of three federal agents whom he shot and seriously wounded when the agents sought to arrest him on May 3, 2012. Acosta was also convicted of being an accessory-after-the-fact to murder, as well as various obstruction offenses. A fourth defendant, Mario Bergren, was acquitted of the charges against him.
The guilty verdict followed a three-month jury trial before the Honorable Susan Illston, United States District Court Judge, in San Francisco. The jury found that Flores, 23, of Petaluma, Campos-Gonzalez, 24, of San Mateo, and Acosta, 29, of South San Francisco, conspired to conduct the affairs of a racketeering enterprise, the 500 Block/C Street Gang. The 500 Block/C Street Gang was a Norteño gang based in South San Francisco that engaged in drug dealing, robbery, obstruction of justice, and crimes of violence, including one of the most violent single crimes in South San Francisco history.
According to the evidence presented at trial, during the evening of Dec. 22, 2010, Flores, along with fellow 500 Block/C Street gang member Joseph Ortiz shot at seven victims, whom they perceived to be rival gang members as the victims walked down Eighth Lane in South San Francisco. Gonzalo Avalos, Omar Cortez, and Hector Flores were killed while three of the others were wounded. Acosta was also convicted of being an accessory-after-the-fact to racketeering murder for his role in helping to cover up the murders.
In addition, when members of the Los Angeles Special Response Team of Homeland Security Investigations went to execute an arrest warrant for Flores on May 3, 2012, in Petaluma, Calif., Flores opened fired on the federal agents with an AK-47-style assault weapon. He fired twenty rounds of large-caliber ammunition at the agents, emptying two full magazines of ammunition, before he eventually surrendered to law enforcement. The jury convicted Flores for the attempted murder of the three federal agents whom he wounded.
“These convictions are the result of the tireless effort of law enforcement agents from multiple agencies working together to keep the community safe. For the victims and their families, there is nothing we can do to erase their pain and sorrow. We hope, however, that these convictions demonstrate that justice has been served and that the victims and their families can now begin to heal,” U.S. Attorney Haag said. “The facts of this case highlight the extraordinary bravery with which the men and women of law enforcement perform their duties.”
“These verdicts represent another important victory in the ongoing effort to rid our communities of violent street gangs along with the scourge of fear and crime they foster,” said Tatum King, acting special agent in charge for HSI San Francisco. “As we said when these defendants were arrested, ‘justice is patient and justice is resolute.’ Yesterday, it was rewarded. In that vein, HSI will continue to work closely with the South San Francisco and Daly City police departments and other local and federal law enforcement agencies to infiltrate and dismantle these dangerous criminal enterprises and hold their members accountable for their actions.”
“The conviction of Victor Flores for his attempted murder of three Department of Homeland Security agents represents a significant victory for the rule of law and for the agents and officers who put their lives on the line every day to enforce those laws,” said David J. Johnson, FBI Special Agent in Charge of the San Francisco Field Office. “The FBI is proud of its role in this highly successful case and will continue to work tirelessly with our law enforcement partners to bring to justice anyone who attempts to harm law enforcement agents or officers engaged in the pursuit of justice.”
"South San Francisco is a safe place to live and work and yesterday's conviction sends a strong message to those who continue to promote the gang lifestyle, that we are not going to tolerate to be shaken by senseless and blatant acts of gang violence," South San Francisco Police Chief Jeff Azzopardi said. "We will continue our partnership with the Daly City Police Department, Homeland Security Investigations(HSI), the FBI, and the United States Attorney's Office to keep South San Francisco as one of the safest places in the Bay Area."
Flores, Campos-Gonzalez, and Acosta are currently being held in custody and are scheduled to be sentenced on Jan. 16, 2015, before Judge Illston. Flores faces a maximum penalty of six life terms plus 103 years’ imprisonment, and a mandatory minimum sentence of three life terms plus 35 years’ imprisonment. Campos-Gonzalez faces up to twenty years’ imprisonment for his conviction for racketeering conspiracy, while Acosta faces up to sixty years’ imprisonment for his conviction for racketeering conspiracy, being an accessory-after-the-fact to murder, and obstruction of justice. However, any sentence will be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
The jury’s verdict concludes an investigation initiated by the South San Francisco Police Department, the Daly City Police Department, HSI, and by the FBI. In all, more than 19 defendants were charged, with more than 15 defendants pleading guilty, including Joseph Ortiz, who is presently serving a sentence of five life terms plus sixty years’ imprisonment for his involvement in the Dec. 22, 2010, shooting.
Acadia L. Senese, Stephen Meyer, and Benjamin Tolkoff are the Assistant United States Attorneys who prosecuted this case, with the assistance of Kevin Costello and Daniel Charlier-Smith.
(Ortiz et al superseding indictment )
Judge Sentenced New Jersey Man to 24 Years in Prison for Conspiring to Distribute HeroinRead the Press Release
PITTSBURGH - A New Jersey resident has been sentenced in federal court to 24 years in prison on his conviction of one count of conspiracy to distribute and possess with the intent to distribute 100 grams or more of heroin, United States Attorney David J. Hickton announced today.
United States District Judge Mark R. Hornak imposed the sentence on Rafael Cabrera, 36, of Passaic, NJ. On May 23, 2014, a federal jury had convicted Cabrera, after a four-day trial, of conspiracy to distribute and possess with the intent to distribute 100 grams or more of heroin.
According to information presented to the court, Cabrera distributed between 1,500 and 2,500 bricks of heroin into the Western District of Pennsylvania. Each brick of heroin contains 50 stamp bags, which each retail for between $6 and $10. Cabrera sold this heroin to a Pittsburgh-based dealer, who provided the heroin to lower-level drug deals. The proceeds from the heroin sales were then remitted to Cabrera after the heroin was distributed.
Prior to imposing sentence, Judge Hornak highlighted the seriousness of Cabrera’s crime and the damage heroin inflicts on society in general and the populace of the Western District of Pennsylvania in particular. The judge searched the record but could find almost no mitigating evidence in Cabrera’s favor. Accordingly, given the magnitude of Cabrera’s heroin trafficking, and the length of his criminal record, which escalated as Cabrera aged, the court sentenced Cabrera to 288 months in prison, followed by 10 years of supervised release.
Assistant United States Attorney Eric S. Rosen prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Federal Bureau of Investigation, the City of Pittsburgh Police, and the Pennsylvania State Police for the investigation leading to the successful prosecution of Cabrera.
International Fugitive for 15 Years Caught by FBI and Sentenced for 1997 Methamphetamine OffenseRead the Press Release
EUGENE, Ore. –Joseph Floyde DeArmond, 51, previously of Medford, Oregon, was sentenced today by U.S. District Chief Judge Ann Aiken to 36 months in federal prison for an offense he committed in 1997 – possession with intent to distribute methamphetamine. Upon his release from prison, DeArmond will be on supervised release for three years.
On June 9, 1997, law enforcement seized a distributable amount of methamphetamine from defendant’s Medford, Oregon home. After being federally charged, DeArmond pled guilty and was scheduled to be sentenced on June 30, 1998. Rather than appear for sentencing, DeArmond fled the United States to Costa Rica. The FBI’s fugitive hunt lasted from 1998 until 2013, when DeArmond was located in Costa Rica living under an assumed name. After positively identifying him as Joseph DeArmond, the FBI worked with the Costa Rican government to arrange for his return to the United States.
Assistant U.S. Attorney Nathan J. Lichvarcik prosecuted this case.
Indictment Charges Six New Jersey Residents in Multimillion-Dollar Mortgage Fraud SchemeRead the Press Release
PHILADELPHIA - An indictment was filed yesterday charging six people, including a couple and their daughter, in a wide-reaching mortgage fraud conspiracy in which the defendants allegedly stripped the equity from the homes of desperate homeowners facing foreclosure, announced United States Attorney Zane David Memeger. The scheme caused losses to mortgage lenders of approximately $3.8 million. Silver Buckman, 36, of Cherry Hill, NJ, her parents, Vincent Foxworth, 69, and Cynthia Foxworth, 63, of Turnersville, NJ, Danette Thomas, 52, of Pennsauken, NJ, Byron White, 44, of Pennsauken, NJ and Franklin Busi, 46 of Sicklerville, NJ, are charged with conspiracy to commit bank fraud and wire fraud. Some of the defendants are also charged with bank fraud and wire fraud.
According to the indictment, the defendants engaged in a scheme in which they offered to help financially-vulnerable individuals save their homes from foreclosure or obtain money from the equity in their homes and, instead, defrauded the homeowners and mortgage lenders. Buckman owned and operated Fresh Start Financial Services (“FSFS”), in Mount Laurel, NJ and was an employee of American Home Lending as well as a mortgage broker for American One Mortgage (“AOM”). Her father is an experienced Realtor.
Between October 2006 and November 2009, Buckman and her co-defendants allegedly targeted financially vulnerable homeowners and represented to them that they could improve their credit, save their homes from foreclosure, or provide them with money through Buckman’s lease buyback program. The homeowners were told that “investors” would be used to temporarily refinance their homes and that they could repurchase the homes in one year, or once they regained their financial footing. The defendants also allegedly induced the homeowners into signing documents related to the sale and lease of their homes by their representations that the homeowners would remain on the title to their homes, that the equity from their homes would be placed into an individual escrow account in their names, and that new mortgages would be paid from the escrow accounts to establish their timely payment histories.
According to the indictment, in order to carry out the scheme, Buckman recruited Vincent Foxworth and Cynthia Foxworth and others to be straw borrowers. White also recruited a straw borrower. Ultimately, Buckman and Busi submitted false financial and employment information about the straw borrowers to mortgage lenders. Once lenders agreed to fund the mortgage loans, Buckman and some of the other defendants allegedly prevented the homeowners from receiving the settlement proceeds and did not put money into escrow accounts for the homeowners. Instead, the defendants distributed the proceeds amongst themselves. Buckman used the majority of the proceeds due the homeowners to pay the fees due the straw borrowers, the down payments on behalf of the straw borrowers in subsequent transactions to further the scheme, and her personal expenses. She used only a fraction of the homeowners’ monies toward the payment of the mortgages obtained by the straw borrowers for the homeowners’ homes and thereby caused the loans to go into default.
If convicted, the defendants face an advisory sentencing guideline range of at least 87 to 108 months in prison plus restitution.
The case was investigated by the Federal Bureau of Investigation and the United States Postal Inspection Service and is being prosecuted by Assistant United States Attorney Anita Eve.
Click here to view the indictment.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Four Defendants Plead Guilty in Connection with HMA Direct Insurance Fraud SchemeRead the Press Release
BOSTON – Four men pleaded guilty yesterday in connection with their participation in a fraudulent scheme perpetrated through a Massachusetts health insurance company known as HMA Direct.
William O’Brien, of West Barnstable, Mark Celentano, of Ipswich, Francis Gaetani, of Sutton, and Ronald Anger, of Sutton, pleaded guilty before U.S. Senior District Judge Mark L. Wolf. Sentencing is scheduled for Jan. 14, 2015.
O’Brien pleaded guilty to conspiracy, wire fraud, health care fraud, and obtaining customer information from a financial institution by false representation. Celentano pleaded guilty to conspiracy, health care fraud, and obstruction of justice. Gaetani and Anger each pleaded guilty to wire fraud.
HMA Direct offered self-funded insurance plans to small businesses in New England. At the heart of HMA Direct’s business was “carving out” from its clients’ self-funded plans those employees who had significant health risks, and then, through false statements, arranging for those employees to be insured through traditional health insurance providers.
O’Brien and Celentano participated in the carve-out scheme and subsequent lies to the health insurance providers. O’Brien also arranged for Gaetani and Anger, who were investors in HMA Direct, to pretend that they were satisfied customers of the company and to provide fake references to prospective clients. In addition, when contacted by federal investigators, Celentano obstructed justice by lying about the role he had played in the HMA Direct carve-out scheme.
For O’Brien, Gaetani, and Anger, the maximum sentence under the relevant statutes is 20 years in prison, three years of supervised release, and a $250,000 fine. For Celentano, the maximum sentence under the statute is 10 years in prison, three years of supervised release and a $250,000 fine.
Two other defendants in this scheme, Michael Cassandro, of Middleton, RI, and Shelley Lenkutis, of Waltham, previously pleaded guilty to related charges. They are scheduled to be sentenced on Dec. 10, 2014.
United States Attorney Carmen M. Ortiz; Susan Hensley, Director of the U.S. Department of Labor, Employee Benefits Security Administration, Boston Regional Office; Cheryl Garcia, Special Agent in Charge for the U.S. Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, New York Regional Office;
¬¬Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and William P. Offord, Inspector in Charge of the U.S. Postal Inspection Service, made the announcement. The case is being prosecuted by Assistant United States Attorneys Kristina Barclay, Gregg Shapiro, and Alexander Berlin.Former Windham Couple Pleads Guilty to Firearms ChargesRead the Press Release
Contact: Darcie N. McElwee
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced that
Theodore “Ted” Thomes, 55, and his wife, Renee Thomes, 51, both formerly of Windham,
Maine, now of St. Croix, U.S. Virgin Islands, pleaded guilty this week, in U.S. District Court, to
firearms charges. Ted Thomes was convicted of being a felon in possession of firearms. Renee
Thomes was convicted of knowingly transferring firearms to a non-Maine resident.According to evidence presented at the plea hearing, prior to July 2011, Renee Thomes
acquired several handguns belonging to a Windham neighbor for whom the couple served as
caretakers. In December 2011, Ted Thomes, a convicted felon who had previously been
convicted in Maine for being a felon in possession of firearms, took the handguns to the home of
another neighbor. In June 2012, Renee Thomes retrieved the handguns and illegally gave them
to a New Hampshire auctioneer.
Ted Thomes faces up to 10 years in prison. Renee Thomes faces up to five years in
prison. Both face a $250,000 fine. They will be sentenced after completion of presentence
investigation reports by the U.S. Probation Office.
The investigation was conducted by the Windham Police Department, the Maine
Attorney General’s Office and the Bureau of Alcohol, Tobacco, Firearms and Explosives.Former New York City Comptroller Candidate Sentenced in Manhattan Federal Court to Two Years in Prison for Illegally Distributing Prescription PillsRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that KRISTIN DAVIS, a former candidate for New York City Comptroller, was sentenced today in Manhattan federal court to two years in prison for illegally distributing hundreds of various types of prescription pills. DAVIS, who was arrested in August 2013, and pled guilty in March 2014 to distributing and possessing with intent to distribute controlled substances, was sentenced by U.S. District Judge Edgardo Ramos.
Manhattan U.S. Attorney Preet Bharara said: “The convictions of Kristin Davis and the other defendants in this wide-ranging diversion investigation demonstrate once again this Office’s and our law enforcement partners’ resolve to fight the prescription drug abuse epidemic in every affected corner of New York City and beyond.”
According to the Complaint, Superseding Information, other information in the public record, and Davis’s guilty plea:
On multiple occasions for a period of years through March 2013, DAVIS sold hundreds of prescription pills, containing amphetamine, alprazolam, zolpidem, and carisoprodol, to a person she knew from her own prior purchases and sales to be a drug dealer. Unbeknownst to DAVIS, the person had become a cooperating witness (the “CW”) with the Federal Bureau of Investigation (“FBI”) and was equipped with a recording device. During these sales, DAVIS was recorded saying that the pills she was selling were “Ambien,” “Soma,” and “Xanax.” On a fourth occasion, in April 2013, DAVIS arranged for another individual to sell approximately 180 oxycodone pills to the CW.
There is an illegal market for all of the drugs DAVIS sold and assisted another in selling. Oxycodone is a powerful painkiller with a high potential for addiction and abuse, and it is often used as a substitute for, or adjunct to, other illegal drugs, such as heroin. Amphetamine is a psycho-stimulant, often referred to as “speed,” and it is often used as a substitute for, or adjunct to, other illegal drugs, including methamphetamine and cocaine. Alprazolam is a psychoactive drug often used as a substitute for, or adjunct to, other illegal drugs, such as LSD, heroin or opiates. Zolpidem is a sedative/hypnotic drug often used as a substitute for, or adjunct to, other illegal drugs, including amphetamine, methamphetamine, cocaine, and MDMA (commonly known as ecstasy). Carisoprodol is a skeletal muscle relaxant often used in conjunction with painkillers and so-called “date rape” drugs.
DAVIS was one of several people charged as part of an investigation conducted by the FBI, the United States Department of Health and Human Services, Office of Inspector General (“HHS-OIG”), the New York City Police Department (“NYPD”), and the U.S. Attorney’s Office into the unlawful distribution of prescription drugs containing controlled substances in and around New York City:
- Thomas Rock was arrested on July 10, 2013, for distributing and conspiring to distribute oxycodone and alprazolam. He pled guilty on February 24, 2014, to distributing oxycodone and alprazolam, and was sentenced by U.S. District Judge Paul A. Engelmayer on July 21, 2014, to 15 months in prison.
- Eugene Kurochkin was arrested on July 11, 2013, for distributing oxycodone, alprazolam, amphetamine, and zolpidem. He pled guilty on November 1, 2013, to distributing oxycodone, alprazolam, amphetamine, and zolpidem, and was sentenced by U.S. District Judge Robert W. Sweet on February 10, 2014, to one year in prison.
- Raoul Goldberger and Rebecca Teman were arrested on July 29, 2013, for distributing and conspiring to distribute amphetamine, oxycodone, and vicodin. Goldberger pled guilty on August 21, 2013, to distributing amphetamine and oxycodone, and was sentenced by U.S. District Judge Colleen McMahon on March 12, 2014, to five years in prison. Teman pled guilty on November 12, 2013, to misbranding a prescription drug, and was sentenced by U.S. Magistrate Judge Henry B. Pitman on March 11, 2014, to 18 months’ probation with a special condition of 100 hours of community service.
- Erik Pichardo, who was referred to as “Individual-1” in the Complaint against DAVIS, was arrested in August 2013 for distributing oxycodone. He pled guilty on December 12, 2013, to conspiracy to distribute oxycodone, and is scheduled to be sentenced by Chief U.S. District Judge Loretta A. Preska on October 23, 2014.
- David J. Wright was arrested on October 3, 2013, for distributing oxycodone, amphetamine, and carisoprodol. He pled guilty on July 14, 2014, to distributing oxycodone, amphetamine, and carisoprodol, and is scheduled to be sentenced by Chief U.S. District Judge Loretta A. Preska on November 18, 2014.
In addition to her prison term, DAVIS, 39, of New York City, was sentenced to two years of supervised release. DAVIS was also ordered to pay $1,765 in forfeiture and a $100 special assessment fee.
Mr. Bharara praised the investigative work of the FBI. He also thanked HHS-OIG and the NYPD for their assistance in the investigation.
These cases are being handled by the Office’s Narcotics Unit. Assistant United States Attorneys Daniel C. Richenthal, Kristy J. Greenberg, and Edward A. Imperatore are in charge of the prosecutions.
Former NFL and University of Florida Football Player Pleads Guilty to Conspiracy to Distribute “Molly”Read the Press Release
Tampa, Florida – United States Attorney A. Lee Bentley, III announces that Donald Reche Caldwell (35, Tampa) pleaded guilty today to conspiracy to possess with intent to distribute a positional isomer of Butylone, also known as Ethylone, and commonly marketed as the street drug “Molly.” He faces a maximum penalty of 20 years in federal prison. A sentencing date has not yet been set.
According to the plea agreement, on May 13, 2014, Caldwell signed for and accepted a parcel containing 1.5 kilograms of Ethylone. The parcel had been mailed to the United States from China. On May 19, 2014, investigators intercepted a second parcel in Atlanta, containing one kilogram of Ethylone. Further investigation revealed that, just days earlier, Caldwell had mailed the parcel from Tampa.
As a positional isomer of Butylone, Ethylone is considered a Schedule I Controlled Substance.
This case was investigated by the Drug Enforcement Administration, U.S. Postal Inspection Service, and U.S. Customs and Border Protection. It is being prosecuted by Assistant United States Attorney Carlton C. Gammons.
Former FBI Special Agent and Co-Defendant Plead Guilty to Conspiracy, Bribery, and Obstruction of Justice SchemeRead the Press Release
A former FBI special agent and a conspirator pleaded guilty in the District of Utah yesterday and today to participating in a bribery scheme to obstruct a grand jury investigation in exchange for the promise of cash and multimillion dollar business contracts offered by a businessman under investigation.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Acting U.S. Attorney Carlie Christensen of the District of Utah and Justice Department Inspector General Michael E. Horowitz made the announcement after the guilty pleas were accepted by U.S. District Judge Tena Campbell.
“No one is above the law, no matter what rank or badge a person might hold,” said Assistant Attorney General Caldwell. “Corruption by those entrusted to enforce the law strikes at the heart of our criminal justice system, and it will not be tolerated. This case lays bare a disgraceful attempt by a veteran FBI agent to get rich by thwarting an ongoing investigation. The Justice Department will fight corruption wherever we find it, even within the ranks of federal law enforcement.”
“These plea agreements demonstrate that Federal law enforcement officers who sell their badges for cash and frustrate the administration of justice will be held accountable for their actions,” said Inspector General Horowitz. “Department employees are held to the highest standards, and we cannot permit our criminal justice system to be stained by such bribery and corruption.”
“When a law enforcement officer violates his oath and the public’s trust by breaking the law, he must be held accountable,” said Acting U.S. Attorney Christensen. “In this case, former Agent Lustyik’s decision to enter into a conspiracy to obstruct a significant fraud investigation in Utah is a troubling reminder that corruption may exist even among those we entrust with protecting our citizens and upholding our laws.”
A 24-year veteran of the FBI, Robert Lustyik Jr., 51, of Sleepy Hollow, New York, pleaded guilty on Sept. 30, 2014, to an 11-count indictment charging him with conspiracy, eight counts of honest services wire fraud, obstruction of a grand jury proceeding, and obstruction of an agency proceeding. A childhood friend of Lustyik, Johannes Thaler, 50, of New Fairfield, Connecticut, pleaded guilty today to conspiracy to commit bribery, obstruction of a grand jury proceeding and obstruction of an agency proceeding. Sentencing is scheduled for Jan. 5, 2015.
In court documents and at the plea hearings, Lustyik and Thaler admitted that from October 2011 to September 2012, Lustyik, while employed as an FBI counterintelligence special agent, and Thaler conspired to use Lustyik’s official position to obstruct a criminal investigation into Michael Taylor, a businessman who owned and operated American International Security Corporation and was under investigation for paying kickbacks to obtain a series of contracts from the Department of Defense worth approximately $54 million. Taylor promised Lustyik and Thaler that in exchange for their help, he would provide them cash and multimillion dollar business contracts. Taylor told the two men: “I’ll make you guys more money than you can believe, provided they don’t think I’m a bad guy and put me in jail.”
Court documents state that Lustyik attempted to obstruct the investigation into Taylor by opening Taylor as an official FBI source in an effort to persuade the FBI, the Justice Department and the prosecutors and law enforcement agents investigating Taylor that Taylor’s usefulness as a source outweighed the government’s interest in prosecuting him. Lustyik also advocated on Taylor’s behalf directly to the prosecutors and law enforcement agents, urging them to use Taylor as a cooperating witness and emphasizing that indicting Taylor would threaten the nation’s security.
According to court documents, while Lustyik was obstructing the investigation into Taylor, Lustyik suggested that Thaler “blatantly” ask Taylor for money, emphasizing “he knows we are keeping him outta jail.” Lustyik explained to Thaler that on his upcoming trip to meet Taylor in Lebanon, “Taylor is gonna hand you cash in Lebanon,” “[l]ike 150 gs.” When Thaler asked Lustyik how he was supposed to bring that much cash back to the United States, Lustyik instructed him “[i]n your pants. Or wire it? They won’t stop 2 white guys at customs without a reason, [o]r I meet you at customs at JFK and cred you in.”
Court records state that during the conspiracy, Lustyik and Thaler acknowledged that Taylor was probably guilty, but they boasted about their success in using Lustyik’s official position to obstruct the investigation into Taylor, with Lustyik texting Thaler, “at this point IF he is indicted there is NO WAY he gets convicted even though he Prob did it.” During the conspiracy, Lustyik texted Thaler, “I think we are rich by Christmas!!” When Thaler asked why, Lustyik responded, “he [Taylor] is gonna be free!!!!!!!!”
Taylor pleaded guilty in the District of Utah to honest services wire fraud for his role in the scheme on Nov. 27, 2013. He is scheduled for sentencing on Jan. 5, 2015.
The investigation was conducted by Assistant Special Agent in Charge Tom Hopkins of the U.S. Department of Justice Office of Inspector General. The case is being prosecuted by Deputy Chief Peter Koski and Trial Attorney Maria Lerner of the Criminal Division’s Public Integrity Section, and Trial Attorney Ann Marie Blaylock of the Criminal Division’s Asset Forfeiture and Money Laundering Section. Scott Ferber of the Counterespionage Section of the National Security Division also assisted in the prosecution.
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Former FBI Special Agent and Co-Defendant Plead Guilty to Conspiracy, Bribery, and Obstruction of Justice SchemeRead the Press Release
SALT LAKE CITY - A former FBI special agent and a conspirator pleaded guilty in Salt Lake City yesterday and today to participating in a bribery scheme to obstruct a grand jury investigation in exchange for the promise of cash and multimillion dollar business contracts offered by a businessman under investigation.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Acting U.S. Attorney Carlie Christensen of the District of Utah and Justice Department Inspector General Michael E. Horowitz made the announcement after the guilty pleas were accepted by U.S. District Judge Tena Campbell.
“No one is above the law, no matter what rank or badge a person might hold,” said Assistant Attorney General Caldwell. “Corruption by those entrusted to enforce the law strikes at the heart of our criminal justice system, and it will not be tolerated. This case lays bare a disgraceful attempt by a veteran FBI agent to get rich by thwarting an ongoing investigation. The Justice Department will fight corruption wherever we find it, even within the ranks of federal law enforcement.”
“These plea agreements demonstrate that Federal law enforcement officers who sell their badges for cash and frustrate the administration of justice will be held accountable for their actions,” said Inspector General Horowitz. “Department employees are held to the highest standards, and we cannot permit our criminal justice system to be stained by such bribery and corruption.”
“When a law enforcement officer violates his oath and the public’s trust by breaking the law, he must be held accountable,” said Acting U.S. Attorney Christensen. “In this case, former Agent Lustyik’s decision to enter into a conspiracy to obstruct a significant fraud investigation in Utah is a troubling reminder that corruption may exist even among those we entrust with protecting our citizens and upholding our laws.”
A 24-year veteran of the FBI, Robert Lustyik Jr., 51, of Sleepy Hollow, New York, pleaded guilty on Sept. 30, 2014, to an 11-count indictment charging him with conspiracy, eight counts of honest services wire fraud, obstruction of a grand jury proceeding, and obstruction of an agency proceeding. A childhood friend of Lustyik, Johannes Thaler, 50, of New Fairfield, Connecticut, pleaded guilty today to conspiracy to commit bribery, obstruction of a grand jury proceeding and obstruction of an agency proceeding. Sentencing is scheduled for Jan. 5, 2015.
In court documents and at the plea hearings, Lustyik and Thaler admitted that from October 2011 to September 2012, Lustyik, while employed as an FBI counterintelligence special agent, and Thaler conspired to use Lustyik’s official position to obstruct a criminal investigation into Michael Taylor, a businessman who owned and operated American International Security Corporation and was under investigation for paying kickbacks to obtain a series of contracts from the Department of Defense worth approximately $54 million. Taylor promised Lustyik and Thaler that in exchange for their help, he would provide them cash and multimillion dollar business contracts. Taylor told the two men: “I’ll make you guys more money than you can believe, provided they don’t think I’m a bad guy and put me in jail.”
Court documents state that Lustyik attempted to obstruct the investigation into Taylor by opening Taylor as an official FBI source in an effort to persuade the FBI, the Justice Department and the prosecutors and law enforcement agents investigating Taylor that Taylor’s usefulness as a source outweighed the government’s interest in prosecuting him. Lustyik also advocated on Taylor’s behalf directly to the prosecutors and law enforcement agents, urging them to use Taylor as a cooperating witness and emphasizing that indicting Taylor would threaten the nation’s security.
According to court documents, while Lustyik was obstructing the investigation into Taylor, Lustyik suggested that Thaler “blatantly” ask Taylor for money, emphasizing “he knows we are keeping him outta jail.” Lustyik explained to Thaler that on his upcoming trip to meet Taylor in Lebanon, “Taylor is gonna hand you cash in Lebanon,” “[l]ike 150 gs.” When Thaler asked Lustyik how he was supposed to bring that much cash back to the United States, Lustyik instructed him “[i]n your pants. Or wire it? They won’t stop 2 white guys at customs without a reason, [o]r I meet you at customs at JFK and cred you in.”
Court records state that during the conspiracy, Lustyik and Thaler acknowledged that Taylor was probably guilty, but they boasted about their success in using Lustyik’s official position to obstruct the investigation into Taylor, with Lustyik texting Thaler, “at this point IF he is indicted there is NO WAY he gets convicted even though he Prob did it.” During the conspiracy, Lustyik texted Thaler, “I think we are rich by Christmas!!” When Thaler asked why, Lustyik responded, “he [Taylor] is gonna be free!!!!!!!!”
Taylor pleaded guilty in the District of Utah to honest services wire fraud for his role in the scheme on Nov. 27, 2013. He is scheduled for sentencing on Jan. 5, 2015.
The investigation was conducted by Assistant Special Agent in Charge Tom Hopkins of the U.S. Department of Justice Office of Inspector General. The case is being prosecuted by Deputy Chief Peter Koski and Trial Attorney Maria Lerner of the Criminal Division’s Public Integrity Section, and Trial Attorney Ann Marie Blaylock of the Criminal Division’s Asset Forfeiture and Money Laundering Section. Scott Ferber of the Counterespionage Section of the National Security Division also assisted in the prosecution.
Former Ebay Exec Sentenced for Insider TradingRead the Press Release
PHILADELPHIA - Christopher Saridakis, 45, of Wilmington DE, was sentenced today to 15 months in prison for giving another person confidential information about eBay stock. Saridakis pleaded guilty on May 9, 2014 to securities fraud. He was a senior executive at GSI Commerce, Inc. (“GSIC”), when he provided material, non-public information regarding eBay’s pending acquisition of GSIC. In addition to the prison term, U.S. District Court Judge Stewart Dalzell ordered one year of supervised release, a $10,000 fine, and a $100 special assessment.
On March 20, 2011, Saridakis, who was privy to discussions of a merger, sent a series of text messages to a Confidential Witness (“CW1”) that began with the defendant asking if CW1 “...own[ed] our [GSIC] shares?” CW1 replied, “no, but it’s cheap.” This response led Saridakis to tell CW1 “you should.” CW1 responded with “ok,” to which Saridakis replied, “soon.” On March 22, 2011, following the receipt of the text messages, while in possession of the inside information, and knowing defendant Saridakis’ position as a senior executive at GSIC, CW1 purchased and caused to be purchased 25,000 shares of GSIC stock on margin for approximately $470,000. On June 20, 2011, CW1 received $737,500 in exchange for the 25,000 shares of GSIC, equating to an illicit profit of $260,304, as a result of the text messages. Saridakis also shared the same material non-public information with other individuals.
The case was investigated by the FBI. It was prosecuted by Assistant United States Attorney Joel D. Goldstein. Saridakis and others have been charged in a parallel civil matter by the Securities and Exchange Commission.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525- Former Deputy Sentenced for Laundering $40 Million in Drug Proceeds
Florida Man Sentenced to 27 Months in Prison for Attempting to Purchase 100 Stolen IdentitiesRead the Press Release
A Florida man was sentenced today to serve 27 months in prison for attempting to purchase sensitive, detailed personal identifying information, known as PII – including Social Security numbers and bank account numbers – to open credit card accounts and file fraudulent tax returns.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney John P. Kacavas of the District of New Hampshire made the announcement. U.S. District Judge Steven J. McAuliffe of the District of New Hampshire imposed the sentence.
Derric Theoc, 36, was indicted by a federal grand jury in July 2013 and pleaded guilty in June 2014 to one count of attempted access device fraud. In addition to his prison sentence, he was ordered to serve two years of supervised release.
In his guilty plea, Theoc admitted that, in April 2013, he attempted to purchase packages of personal identifying information for 100 people from an undercover United States Secret Service agent who was posing as a known, prolific vendor of personally identifiable information, Hieu Minh Ngo. Theoc had previously made multiple similar purchases from Ngo.
Ngo, a Vietnamese national, pleaded guilty on March 3, 2013, to wire fraud, identification fraud and fraud in connection with access devices and on Aug. 21, 2014, to a separate indictment to four counts of computer fraud. Sentencing is scheduled for Dec. 1, 2014. According to court documents, Ngo administered websites from 2007 through February 2013 that allowed more than 1,000 individuals from throughout the world to access databases containing personal identifying information and conduct more than 3 million queries to obtain a person’s date of birth, Social Security number and other information. He also sold or transferred more than 150,000 packages of personally identifiable information that would allow criminals to take over the identity of another person.
The packages of personal identifying information that Theoc attempted to purchase typically included a person’s name, address, date of birth, Social Security number, mother’s maiden name, driver’s license number, bank account number, bank routing number, email account, account password and place of work. Theoc further admitted that he attempted to purchase the information with the intent to obtain credit cards to make purchases or withdraw money and to file fraudulent tax returns in an effort to receive refunds to which he was not entitled.
The case is being investigated by the United States Secret Service. The case is being prosecuted by Senior Counsel Mysti Degani of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Arnold H. Huftalen of the District of New Hampshire.
Flakeboard Abandons Its Proposed Acquisition of SierraPineRead the Press Release
Flakeboard America Ltd. abandoned its plan to acquire one medium-density fiberboard (MDF) and two particleboard mills from SierraPine after the Department of Justice expressed concerns about the transaction’s likely anticompetitive effects in MDF. The department said that the transaction likely would have substantially lessened competition in the market for the production of MDF sold to customers in the west coast states of California, Oregon and Washington.
MDF is a manufactured wood product widely used in furniture, kitchen cabinets, and decorative mouldings. An increase in the price of MDF would likely result in significant harm to MDF consumers on the West Coast, the department said.
“This deal threatened to weaken competition and raise MDF prices for customers on the West Coast,” said Bill Baer, Assistant Attorney General of the Department of Justice’s Antitrust Division. “The companies’ decision to abandon the deal is a victory for consumers, who will continue to enjoy the benefits of MDF competition between Flakeboard and SierraPine.”
Flakeboard and SierraPine are two of only four significant suppliers of MDF to the West Coast. Both companies operate MDF mills in Oregon—Flakeboard in Eugene; SierraPine in Medford—and the nearest competing mill is several hundred miles away. For many customers, Flakeboard and SierraPine are the two closest sellers of MDF. The proposed merger would have given the combined firm a 58 percent market share for the thicker and denser grades of MDF that Flakeboard and SierraPine sell on the West Coast.
According to the department, the acquisition would have eliminated significant head-to-head competition between Flakeboard and SierraPine. In addition, by gaining control over SierraPine’s MDF mill, the department said that Flakeboard would have been in a better position to raise prices by restricting the amount of MDF available to the West Coast. The acquisition also would have enhanced the risk of coordination between Flakeboard and its few remaining rivals on output and prices, the department said.
Flakeboard is a Delaware corporation headquartered in Ontario, Canada. Flakeboard’s parent company is Celulosa Arauco y Constitución (Arauco), which is held by Inversiones Angelini y Compañia Limitada, a Chilean corporation headquartered in Santiago, Chile. In 2013, Flakeboard’s annual revenues from its MDF business were approximately $380 million. SierraPine is a California limited partnership headquartered in Roseville, California. In 2013, SierraPine’s annual revenues from its MDF business were approximately $70 million.
Five Army National Guard Officials and One Civilian Charged with BriberyRead the Press Release
Four retired and one active-duty Army National Guard officials and one civilian have been charged for their alleged participation in bribery schemes related to the awarding of millions of dollars of Army National Guard marketing, retention and recruitment contracts. Two of the retired Army National Guard officials and the civilian pleaded guilty for their roles in the schemes.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Dana J. Boente of the Eastern District of Virginia, U.S. Attorney Loretta E. Lynch of the Eastern District of New York, Assistant Director in Charge Andrew McCabe of the FBI’s Washington Field Office, Special Agent in Charge Robert E. Craig Jr. of the Defense Criminal Investigative Service (DCIS) Mid-Atlantic Field Office and Director Frank Robey of the U.S. Army Criminal Investigative Command’s Major Procurement Fraud Unit (Army-CID) made the announcement.
“As captured by its motto, the Army National Guard is ‘always ready, always there’ for the American people,” said Assistant Attorney General Caldwell. “Unfortunately, today’s charges expose National Guard officials who were ‘always ready’ to pocket bribes and ‘always there’ to take kickbacks. In return, the charged officials allegedly subverted the open bidding process and illegally steered millions of taxpayer dollars to the bribe-payers through marketing and advertising contracts. Corruption should know no place in American government, but least of all in the military that so honorably serves our country. The Criminal Division is committed to rooting out corruption wherever we find it, including in the military, so that we can ensure that no one is putting the public’s trust up for sale.”
“These criminal charges and guilty pleas reflect our continued commitment to rooting out public corruption wherever it occurs,” said U.S. Attorney Boente. “The public contracting process should be one of integrity and fairness, and these cases should send a strong message that public corruption will be vigorously prosecuted in the military as well as other areas of government.”
“This investigation has sadly reminded us that even some members of our military are willing to trade on the trust their country placed in them to line their pockets with the profits of corrupt activities,” said U.S. Attorney Lynch. “We and our law enforcement partners will constantly guard against and root out such corruption wherever we find it.”
Charles Sines, 56, of Stafford, Virginia, a retired colonel from the United States Army National Guard; Wesley Russell, 48, of Albany, Indiana, a retired lieutenant colonel from the Indiana Army National Guard; and Jason Rappoccio, 39, of Hampton, South Carolina, an active-duty sergeant first class from the Army National Guard are charged with conspiracy to solicit bribes and the solicitation of bribes. Russell and Rappoccio allegedly asked for and received bribes, and Sines allegedly provided bribes.
Robert Porter, 50 of Columbia, Maryland, a retired colonel from the Army National Guard, and Timothy Bebus, 44, of Forest Lake, Minnesota, a retired sergeant major of the Minnesota Army National Guard and owner of Mil-Team Consulting and Solutions LLC, each pleaded guilty in the Eastern District of Virginia in September 2014 to conspiracy to commit bribery and bribery of a public official. Julianne Hubbell, 45, of Brooklyn Park, Minnesota, a civilian who partnered with her brother, Bebus, as the vice president of operations of Mil-Team, also pleaded guilty in September 2014 to conspiracy to commit bribery. Sentencing hearings for Bebus and Hubbell are scheduled for Jan. 23, 2015, and for Porter on Jan. 30, 2015.
“The alleged steering of large government contracts is offensive to active duty, reserve and retired members of the National Guard Bureau who took an oath to support and defend the Constitution,” said FBI Assistant Director in Charge McCabe. “It is also offensive to average American citizens who trust their government and its contractors to use taxpayer money wisely. We urge anyone who has knowledge of corruption and abuse in federal government contracting to contact the FBI.”
“The Department of Defense places special trust and confidence in its service members, particularly those in positions to influence the expenditure of taxpayer dollars,” said DCIS Special Agent in Charge Craig. “Guardsmen hold a unique position in our society, representing both their state and military service. The alleged behavior uncovered in this investigation was a disservice to both, but in no way typical of those honorable women and men that serve in our Army and Air National Guard. Identifying and investigating fraud and public corruption remains the highest of priorities for the Defense Criminal Investigative Service. Alongside our law enforcement partners, we will continue to aggressively pursue allegations of fraud impacting Department of Defense resources.”
“We have highly-trained, Army CID special agents who are extremely talented and very capable of rooting out this type of corruption within our ranks,” said Army-CID Director Robey. “People must realize, both in and out of uniform, that fraud will not be tolerated within the Army and Department of Defense, and greed cannot and will not trump duty and honor.”
As set forth in the indictments and other publicly-filed documents, the National Guard Bureau is a joint activity of the U.S. Department of Defense (DOD), state Army National Guard units and the Departments of the Army and Air Force. The National Guard Bureau, located in Arlington, Virginia, oversees the distribution of federal funding provided to the Army National Guard and its state units.
The DOD provides millions of dollars of federal funds to the Army National Guard for, among other things, advertising, marketing and sponsorships in order to recruit new members. The National Guard Bureau uses these funds to promote the Army National Guard by entering into advertising, marketing and sponsorship contracts. For example, through advertising, marketing and sponsorship contracts, the National Guard was an official sponsor of Dew Tour, Warrior Dash, and American Motorcycle Association Supercross’s events, where recruiters handed out promotional items and recruited new members. The National Guard also had a contract to sponsor Michael Jordan’s AMA Superbike team.
The National Guard Bureau can avoid a competitive bid process by awarding these federally-funded marketing contracts to Small Business Administration (SBA) certified 8(a) companies, which are minority-owned businesses. The National Guard Bureau also provides a portion of the federal funds to the state units to allocate.
The indictments allege that Sines and Rappoccio evaded the competitive bid process by using 8(a) companies to award contracts in exchange for bribes.
According to allegations in the indictment against him, Sines founded a company, Financial Solutions, after retiring from the Army National Guard as a colonel. Sines allegedly paid Porter, a then-active-duty colonel in the Army National Guard, a percentage of all contracts that Porter steered to Financial Solutions through 8(a) companies. As the director of the National Guard Bureau’s Guard Strength Directorate, Porter had substantial influence over the awarding of National Guard Bureau contracts, and allegedly steered approximately $4.5 million worth of contracts to Sines and Financial Solutions.
The indictment against Russell alleges that, while on active duty as a lieutenant colonel in the Indiana Army National Guard, Russell demanded 15 percent of all profits that a private marketing company would receive from state Army National Guard units. In return for his 15 percent cut of the profits, Russell allegedly promoted and encouraged state Army National Guard units to purchase the marketing company’s products.
The indictment against Rappoccio, an active-duty sergeant first class in the Army National Guard, alleges that Bebus and Hubbell paid Rappoccio a $30,000 bribe for steering a contract worth approximately $3.7 million to an 8(a) company chosen by Bebus. In pleading guilty, Bebus and Hubbell admitted to paying this bribe. In an effort to conceal the bribe payment, Bebus, Hubbell and others allegedly arranged for the payment of $6,000 in cash to Rappoccio, and the remaining $24,000 was allegedly routed from a business account controlled by Hubbell to an account controlled by Bebus and Hubbell’s brother-in-law, and then provided to Rappoccio in the form of a cashier’s check to Rappoccio’s wife.
An indictment is merely an allegation, and the defendants are presumed innocent unless and until proven guilty.
The case is being investigated by the FBI’s Washington Field Office, with assistance from DCIS’s Mid-Atlantic Field Office and Army-CID’s Expeditionary Fraud Resident Agency’s Major Procurement Fraud Unit. The case is being prosecuted by Trial Attorney Alison L. Anderson of the Criminal Division’s Fraud Section, Assistant U.S. Attorney Jonathan Fahey of the Eastern District of Virginia and Assistant U.S. Attorneys Marisa Seifan and Martin Coffey of the Eastern District of New York.
Allegations of bribery or corruption within the National Guard Bureau’s retention and recruitment contracting can be reported to the FBI’s Washington Field Office at (202) 278-2000 or the FBI’s Northern Virginia Public Corruption Hotline at (703) 686-6225.
Bebus Statement of Facts
Hubbell Statement of Facts
Porter Statement of Facts
Indictment - Sines 14cr325
Indictment - Russell 14cr324
Indictment - Rappoccio 14cr323
Five Army National Guard Officials and One Civilian Charged with BriberyRead the Press Release
WASHINGTON – Four retired and one active-duty Army National Guard officials and one civilian have been charged for their alleged participation in bribery schemes related to the awarding of millions of dollars of Army National Guard marketing, retention and recruitment contracts. Two of the retired Army National Guard officials and the civilian pleaded guilty for their roles in the schemes.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Dana J. Boente of the Eastern District of Virginia, U.S. Attorney Loretta E. Lynch of the Eastern District of New York, Assistant Director in Charge Andrew McCabe of the FBI’s Washington Field Office, Special Agent in Charge Robert E. Craig Jr. of the Defense Criminal Investigative Service (DCIS) Mid-Atlantic Field Office and Director Frank Robey of the U.S. Army Criminal Investigative Command’s Major Procurement Fraud Unit (Army-CID) made the announcement.
“As captured by its motto, the Army National Guard is ‘always ready, always there’ for the American people,” said Assistant Attorney General Caldwell. “Unfortunately, today’s charges expose National Guard officials who were ‘always ready’ to pocket bribes and ‘always there’ to take kickbacks. In return, the charged officials allegedly subverted the open bidding process and illegally steered millions of taxpayer dollars to the bribe-payers through marketing and advertising contracts. Corruption should know no place in American government, but least of all in the military that so honorably serves our country. The Criminal Division is committed to rooting out corruption wherever we find it, including in the military, so that we can ensure that no one is putting the public’s trust up for sale.”
“These criminal charges and guilty pleas reflect our continued commitment to rooting out public corruption wherever it occurs,” said U.S. Attorney Boente. “The public contracting process should be one of integrity and fairness, and these cases should send a strong message that public corruption will be vigorously prosecuted in the military as well as other areas of government.”
“This investigation has sadly reminded us that even some members of our military are willing to trade on the trust their country placed in them to line their pockets with the profits of corrupt activities,” said U.S. Attorney Lynch. “We and our law enforcement partners will constantly guard against and root out such corruption wherever we find it.”
Charles Sines, 56, of Stafford, Virginia, a retired colonel from the United States Army National Guard; Wesley Russell, 48, of Albany, Indiana, a retired lieutenant colonel from the Indiana Army National Guard; and Jason Rappoccio, 39, of Hampton, South Carolina, an active-duty sergeant first class from the Army National Guard are charged with conspiracy to solicit bribes and the solicitation of bribes. Russell and Rappoccio allegedly asked for and received bribes, and Sines allegedly provided bribes.Robert Porter, 50 of Columbia, Maryland, a retired colonel from the Army National Guard, and Timothy Bebus, 44, of Forest Lake, Minnesota, a retired sergeant major of the Minnesota Army National Guard and owner of Mil-Team Consulting and Solutions LLC, each pleaded guilty in the Eastern District of Virginia in September 2014 to conspiracy to commit bribery and bribery of a public official. Julianne Hubbell, 45, of Brooklyn Park, Minnesota, a civilian who partnered with her brother, Bebus, as the vice president of operations of Mil-Team, also pleaded guilty in September 2014 to conspiracy to commit bribery. Sentencing hearings for Bebus and Hubbell are scheduled for Jan. 23, 2015, and for Porter on Jan. 30, 2015.
“The alleged steering of large government contracts is offensive to active duty, reserve and retired members of the National Guard Bureau who took an oath to support and defend the Constitution,” said FBI Assistant Director in Charge McCabe. “It is also offensive to average American citizens who trust their government and its contractors to use taxpayer money wisely. We urge anyone who has knowledge of corruption and abuse in federal government contracting to contact the FBI.”
“The Department of Defense places special trust and confidence in its service members, particularly those in positions to influence the expenditure of taxpayer dollars,” said DCIS Special Agent in Charge Craig. “Guardsmen hold a unique position in our society, representing both their state and military service. The alleged behavior uncovered in this investigation was a disservice to both, but in no way typical of those honorable women and men that serve in our Army and Air National Guard. Identifying and investigating fraud and public corruption remains the highest of priorities for the Defense Criminal Investigative Service. Alongside our law enforcement partners, we will continue to aggressively pursue allegations of fraud impacting Department of Defense resources.”
“We have highly-trained, Army CID special agents who are extremely talented and very capable of rooting out this type of corruption within our ranks,” said Army-CID Director Robey. “People must realize, both in and out of uniform, that fraud will not be tolerated within the Army and Department of Defense, and greed cannot and will not trump duty and honor.”
As set forth in the indictments and other publicly-filed documents, the National Guard Bureau is a joint activity of the U.S. Department of Defense (DOD), state Army National Guard units and the Departments of the Army and Air Force. The National Guard Bureau, located in Arlington, Virginia, oversees the distribution of federal funding provided to the Army National Guard and its state units.
The DOD provides millions of dollars of federal funds to the Army National Guard for, among other things, advertising, marketing and sponsorships in order to recruit new members. The National Guard Bureau uses these funds to promote the Army National Guard by entering into advertising, marketing and sponsorship contracts. For example, through advertising, marketing and sponsorship contracts, the National Guard was an official sponsor of Dew Tour, Warrior Dash, and American Motorcycle Association Supercross’s events, where recruiters handed out promotional items and recruited new members. The National Guard also had a contract to sponsor Michael Jordan’s AMA Superbike team.
The National Guard Bureau can avoid a competitive bid process by awarding these federally-funded marketing contracts to Small Business Administration (SBA) certified 8(a) companies, which are minority-owned businesses. The National Guard Bureau also provides a portion of the federal funds to the state units to allocate.
The indictments allege that Sines and Rappoccio evaded the competitive bid process by using 8(a) companies to award contracts in exchange for bribes.
According to allegations in the indictment against him, Sines founded a company, Financial Solutions, after retiring from the Army National Guard as a colonel. Sines allegedly paid Porter, a then-active-duty colonel in the Army National Guard, a percentage of all contracts that Porter steered to Financial Solutions through 8(a) companies. As the director of the National Guard Bureau’s Guard Strength Directorate, Porter had substantial influence over the awarding of National Guard Bureau contracts, and allegedly steered approximately $4.5 million worth of contracts to Sines and Financial Solutions.
The indictment against Russell alleges that, while on active duty as a lieutenant colonel in the Indiana Army National Guard, Russell demanded 15 percent of all profits that a private marketing company would receive from state Army National Guard units. In return for his 15 percent cut of the profits, Russell allegedly promoted and encouraged state Army National Guard units to purchase the marketing company’s products.
The indictment against Rappoccio, an active-duty sergeant first class in the Army National Guard, alleges that Bebus and Hubbell paid Rappoccio a $30,000 bribe for steering a contract worth approximately $3.7 million to an 8(a) company chosen by Bebus. In pleading guilty, Bebus and Hubbell admitted to paying this bribe. In an effort to conceal the bribe payment, Bebus, Hubbell and others allegedly arranged for the payment of $6,000 in cash to Rappoccio, and the remaining $24,000 was allegedly routed from a business account controlled by Hubbell to an account controlled by Bebus and Hubbell’s brother-in-law, and then provided to Rappoccio in the form of a cashier’s check to Rappoccio’s wife.
An indictment is merely an allegation, and the defendants are presumed innocent unless and until proven guilty.
The case is being investigated by the FBI’s Washington Field Office, with assistance from DCIS’s Mid-Atlantic Field Office and Army-CID’s Expeditionary Fraud Resident Agency’s Major Procurement Fraud Unit. The case is being prosecuted by Trial Attorney Alison L. Anderson of the Criminal Division’s Fraud Section, Assistant U.S. Attorney Jonathan Fahey of the Eastern District of Virginia and Assistant U.S. Attorneys Marisa Seifan and Martin Coffey of the Eastern District of New York.
Allegations of bribery or corruption within the National Guard Bureau’s retention and recruitment contracting can be reported to the FBI’s Washington Field Office at (202) 278-2000 or the FBI’s Northern Virginia Public Corruption Hotline at (703) 686-6225.
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Felon Sentenced to 41 Months for His Role in a Firearms Straw Purchasing/Trafficking InvestigationRead the Press Release
EUGENE, Ore. – On October 1, 2014, Charles Thornton, 39 years old, of Patterson, California, was sentenced by U.S. District Chief Judge Ann Aiken to 41 months in federal prison for his role in a firearms straw purchasing and trafficking investigation. Upon his release from prison, Thornton will be on supervised release for three years.
In August 2008, Thornton, a felon and crack cocaine dealer, recruited a woman named Eleanor Arceneaux, a crack cocaine customer of his, to buy firearms for him from various firearms dealers in southern Oregon. Thornton needed others to buy firearms because, as a felon, he was prohibited from doing so. Purchases of guns in this manner, where the actual purchaser conceals his involvement from the seller of the firearm, are commonly known as “straw purchases.” Firearms straw-purchasing offenses are particularly reprehensible because those firearms often end up in the hands of people who are not lawfully allowed to possess them and regularly end up being used in violent crimes.
Over the next few months, Arceneaux acted as a straw-purchaser in purchasing approximately 35 firearms for Thornton and others. During the transactions involving Thornton, he gave Arceneaux the money to purchase the firearms, accompanied her to the firearms dealers, instructed her which firearms to purchase, and compensated her with crack cocaine. At least several of the firearms purchased during this scheme surfaced at crime scenes in the Oakland, California area shortly after purchase.
After being federally charged, Thornton pled guilty to three counts of making false statements in connection with the acquisition of firearms and three counts of being a felon in possession of firearms. Arceneaux, for her part, pled guilty in federal court to one count of conspiracy to straw purchase firearms and nine counts of making false statements in connection with the acquisition of firearms, and was sentenced earlier this year to five years of probation.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and was prosecuted by Assistant U.S. Attorney Nathan J. Lichvarcik.
Federal Grand Jury Indicts Driver in Fatal Accident on Naval Station NewportRead the Press Release
PROVIDENCE, R.I. – A federal grand jury in Providence, R.I., on Tuesday returned a one-count indictment charging Alan Bradley, 53, of Newport, R.I., with operating a motor vehicle in reckless disregard of the safety of others resulting in the death of another person.
Bradley was released on unsecured bond and standard conditions, with the additional condition that he not drive, following his arraignment today before U.S. District Court Magistrate Judge Patricia A. Sullivan. A not guilty plea was entered.
The indictment was brought as a result of an investigation conducted by Naval Criminal Investigative Service and the Rhode Island State Police into a fatal motor vehicle accident which occurred on Naval Station Newport on September 26, 2013. It is alleged that Bradley was driving a vehicle that struck and killed Navy Police Detective Frank Lema.
The indictment is announced by United States Attorney Peter F. Neronha; Leo Lamont, Special Agent in Charge of the Northeast Field Office of Naval Criminal Investigative Service; and Colonel Stephen G. O’Donnell, Superintendent of the Rhode Island State Police.
An indictment is merely an allegation and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Operating a motor vehicle in reckless disregard of the safety of others resulting in the death of another person is punishable by a statutory penalty of up to 10 years in federal prison followed by up to 3 years’ supervised release and a fine of up to $5,000.
The case is being prosecuted by First Assistant United States Attorney Stephen G. Dambruch.
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To assist the media and the public, a glossary of federal judicial terms and procedures is available at http://www.justice.gov/usao/justice101/
Contact: 401-709-5357
[email protected]East Texans Charged in Red River Army Depot ConspiracyRead the Press Release
Department of Justice
Office of Public AffairsTEXARKANA, Texas - U.S. Attorney John M. Bales and Colonel Brandon Grubbs, Red River Army Depot Installation Commander, announced today that seven individuals have been indicted on federal charges involving conspiracy to commit an offense and to defraud the U.S. government and theft of government property or money in the Eastern District of Texas.
The defendants were named in a 2-count indictment returned by a federal grand jury on Sep. 17, 2014, charging them with conspiracy to commit an offense against and to defraud the U.S. government and theft of government property or money. These violations are alleged to have caused over $2 million in losses to the Department of the Army and Red River Army Depot. Those charged are:
Kenneth Ray Shackelford, 54, of Texarkana, Texas
Anthony Paul Vera, 54, of Dekalb, Texas
Shaun Dennis Knorr, 35, of Douglasville, Texas
Patrick Ray James, 54, of Hooks, Texas
William Robert Barr, 56, of Atlanta, Texas
Rodney Glen Cornelius, 63, of Queen City, Texas
William Randall Scott, 59, of Dekalb, TexasThe indictment was unsealed today and the defendants are scheduled to make initial appearances before U.S. Magistrate Judge Caroline Craven on Oct. 2, 2014.
Red River Army Depot (RRAD) is a Department of the Army installation in Bowie County, Texas, that employs a large civilian workforce. RRAD’s primary mission is to repair tactical vehicles for the military. RRAD maintains a fleet of tractor-trailers to bring tactical vehicles to and from RRAD for them to be repaired.
Benny Woodard, deceased, of Dekalb, Texas, was an Army civilian employee at RRAD who was responsible for the maintenance of the fleet of tractor-trailers. According to the indictment, it is alleged that beginning in January 2007 until the time of his death in April 2013, Benny Woodard conspired with other RRAD employees and local vendors in the Texarkana area to defraud the Department of the Army by billing RRAD for tires and parts never received and for services never rendered. Shackelford, Vera, Knorr, James, and Barr are vendors of tires, parts, and repair services in the Texarkana area that are alleged to have conspired with Benny Woodard in the alleged scheme. Cornelius and Scott were RRAD civilian employees who are alleged to have facilitated the scheme at the direction of Benny Woodard.
If convicted of conspiracy to commit an offense against or defraud the U.S. government, the defendants each face up to five years in federal prison. If convicted of theft of government property or money, the defendants each face up to 10 years in federal prison.
This case is being investigated by the Federal Bureau of Investigation, the Department of the Army Criminal Investigations Division, and the Red River Army Depot Criminal Investigations Division. This case is being prosecuted by Assistant U.S. Attorney D. Ryan Locker.
An indictment is not evidence of guilt. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.Duval County Man Sentenced to 3 Years for Counterfeit Business ChecksRead the Press Release
Jacksonville, Florida – U.S. District Judge Henry Lee Adams yesterday sentenced Terrance Smith (38, Duval County) to 36 months in federal prison for his involvement in passing multiple counterfeit business checks, and for violating the terms of his federal supervised release.
According to court documents, in October 2013, the pastor from a local church contacted the Jacksonville Sheriff’s Office (JSO) and reported that the church’s bank account number was being used on counterfeit business checks that were being cashed throughout Duval County. The sheriff’s office determined that ten individuals had cashed or attempted to cash approximately 25 counterfeit business checks, purportedly from Waste Management and Ciera Staffing, using the church’s bank account number.
From a date unknown, but at least from in or about October 2013, Smith, in conjunction with others, began obtaining and distributing counterfeit business checks using the church’s bank account number. Smith would recruit various individuals and provide transportation to them for the purpose of cashing the checks. When a passer was successful in cashing a check, the proceeds were returned to Smith. After paying a percentage of the proceeds to the passer, Smith retained the remaining cash, or shared it with others involved in recruiting individuals into the scheme.
On November 13, 2013, JSO, U.S. Secret Service, and members of the North Florida High Tech Crime Task Force set up surveillance in a Jacksonville trailer park. A vehicle being driven by Smith, and containing another individual, entered the trailer park. Officers conducted an investigative stop of the vehicle after it exited the park. An inventory of the vehicle revealed counterfeit check stubs listing the purported earnings of employees for various companies, along with torn counterfeit checks supposedly issued by Winn-Dixie.
This case was investigated by the North Florida High Tech Crime Task Force, JSO, and U.S. Secret Service. It was prosecuted by Assistant United States Attorney Kevin C. Frein.
Detroit-Area Operator of Adult Day Care Center, Two Home Health Care Company Owners Convicted in $29 Million Medicare Fraud ConspiracyRead the Press Release
A federal jury in Detroit late yesterday convicted the operator of an adult day care center and two individuals who owned and operated a network of home health care companies for their participation in a $29 million Medicare fraud scheme.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan, Special Agent in Charge Paul M. Abbate of the FBI’s Detroit Field Office, Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Office of Investigations Detroit Office and Special Agent in Charge Jarod Koopman of the Internal Revenue Service – Criminal Investigation (IRS-CI) Detroit Field Office made the announcement.
According to evidence presented at trial, Felicar Williams, 51, of Dearborn, Michigan, operated Haven Adult Day Care Center LLC (Haven), which purported to provide adult day care services for patients suffering from mental health disorders such as schizophrenia and dementia. At Williams’s direction, Haven billed Medicare for sophisticated mental health services purportedly provided by other, unlicensed staff members.
Evidence at trial also established that Abdul Malik Al-Jumail, 54, and his daughter, Jamella Al-Jumail, 25, both of Brownstown, Michigan, owned and operated a series of fraudulent home health care companies, including ABC Home Care Inc., Associates in Home Care Inc., Accessible Home Care Inc., Swift Home Care LLC, and Be Well Home Care LLC. The companies billed Medicare for home health services that were not needed or not provided. At the instruction of both Abdul Malik Al-Jumail and Jamella Al-Jumail, employees of the home health companies fabricated patient medical records to make it appear that the services were needed and provided.
According to evidence presented at trial, Abdul Malik Al-Jumail paid kickbacks to Williams to obtain billing information about patients at Haven. He then used the information to bill Medicare for home health care services that were never provided.
In addition, the evidence at trial showed that, on May 2, 2012, the day her father was arrested, Jamella Al-Jumail instructed an employee to retrieve falsified patient medical records from the company. Later that day, Jamella Al-Jumail and others helped burn the false records.
Haven and the various home health care companies billed Medicare for more than $29 million in the course of the conspiracy.
The defendants were charged in a superseding indictment on May 1, 2014. After the 12-week jury trial, Williams was found guilty of conspiracy to commit health care fraud and conspiracy to pay and receive health care kickbacks in relation to the sale of Medicare billing information to Abdul Malik Al-Jumail.
Abdul Malik Al-Jumail and Jamella Al-Jumail were each found guilty of conspiracy to commit health care fraud. Abdul Malik Al-Jumail was also found guilty of conspiracy to pay and receive health care kickbacks. Jamella Al-Jumail was also found guilty of destroying documents in connection with a federal investigation.
Carey Vigor, 61, a psychiatrist from Algonac, Michigan, was also charged in the indictment and was acquitted by the jury.
Sentencing has not yet been scheduled. Two other individuals charged in the indictment, Mohammed Sadiq and Philandis Thomas, are scheduled for trial in October 2014. One individual remains a fugitive.
The charges contained in an indictment are merely accusations, and a defendant is presumed innocent unless and until proven guilty.
The case is being investigated by HHS-OIG, FBI and IRS-CI and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan. The case is being prosecuted by Trial Attorneys Patrick Hurford, Chris Cestaro and Brooke Harper of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Team (HEAT), go to: www.stopmedicarefraud.gov.
Department of Justice Announces $63 Million to Support School Safety Research and Reduce Gun ViolenceRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, the Attorney General and the Office of Justice Programs’ National Institute of Justice (NIJ), today announced it has awarded nearly $63 million to school districts and research organizations through the Comprehensive School Safety Initiative (CSSI). CSSI is a large-scale, multi-agency research effort to build knowledge about effective approaches to increasing school safety nationwide.
Through the Initiative, 24 research projects receive funding under two different solicitations. The first, “Investigator-Initiated Research,” includes nine awards to research organizations totaling more than $18 million. The second, “Developing Knowledge about What Works to Make Schools Safe,” provides more than $45 million to 15 school districts and their research partners.
The School Board of Miami-Dade will receive $4,273,799, for its Evaluating Campus Shield program, and the School District of Palm Beach County will receive $3,909,116, for its School Safety and Student Performance Partnership.
“This funding is being awarded as part of the Comprehensive School Safety Initiative – a large-scale, multi-agency research effort to build practical, and scientifically-sound, knowledge about effective ways to increase school safety nationwide,” said Attorney General Holder. “It will enable us to examine and implement additional actions to make schools safer. And it will yield new insights and evidence about what works – and what doesn’t – when it comes to school discipline, violence and bullying reduction, school resource officers, mental health professionals, and justice interventions like youth courts.”
President Obama’s January 2013 plan to end gun violence emphasized keeping guns out of potentially dangerous hands and recognized that additional actions are needed to make our schools safer. CSSI was launched in early 2014 in response to a Congressional request for a broad, research-based effort to increase safety in the nation’s schools.
U.S. Attorney Ferrer stated “The sole focus of children should be on learning, not whether or not their school is safe. I commend the Miami-Dade and Palm Beach County schools for their commitment to examining, and ultimately implementing, the best methodology to keep our community’s children safe and focused on their education.”
“We know a great deal about how to make schools safe in general but very little about the specifics for various settings and populations,” said Dr. William J. Sabol, Acting Director of NIJ. “With this $63 million investment, the nation will gain an understanding of school safety that is scientifically sound, practical, and that can be easily interpreted and used by schools.”
The initiative has three primary goals: to collect national-level data; to convene stakeholders to identify and share best practices; and to conduct innovative research and evaluate pilot projects in school districts. The programs and policies within CSSI are designed to produce evidence about what works in such areas of school safety as effectiveness of school resource officers and mental health professionals, violence and bullying reduction, and effectiveness of such restorative justice interventions as youth courts. The initiative will also examine potential unintended consequences of school safety efforts, including the excessive use of exclusionary discipline and arrests of students.
Although NIJ has primary responsibility for CSSI, the program is a collaborative effort among more than 20 federal partners, including the Departments of Justice, Education, Health and Human Services, Homeland Security, and the Treasury. This partnership will allow the federal government to make a significant impact on school safety by investing limited funds in research that has practical applications for every school in the nation. By determining what interventions work best for specific schools and students, CSSI will provide professionals with a body of knowledge to help them make decisions about which programs will be most effective — and most cost effective — for their particular schools and their challenges.
A list of the awards can be viewed http://nij.gov/topics/crime/school-crime/documents/comprehensive-school-safety-initiative-awards-fy-2014.pdf?utm_source=feature&utm_medium=nijgov-home&utm_campaign=CSSI-awards and more information about CSSI is available at www.nij.gov, keywords: “School Safety.”
The Office of Justice Programs (OJP), headed by Assistant Attorney General Karol V. Mason provides federal leadership in developing the nation’s capacity to prevent and control crime, administer justice, and assist victims. OJP has six bureaus and offices: the Bureau of Justice Assistance; the Bureau of Justice Statistics; the National Institute of Justice; the Office of Juvenile Justice and Delinquency Prevention; the Office for Victims of Crime; and the Office of Sex Offender Sentencing, Monitoring, Apprehending, Registering, and Tracking (SMART).
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.
Defendants Convicted in Manhattan Federal Court for Illegal Distribution of Oxycodone from Pharmacy in YonkersRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that CHRISTINA CHAI, the supervising pharmacist at Stanley Pharmacy in Yonkers, New York (“Stanley Pharmacy”), and HI JONG LEE, the owner of Stanley Pharmacy and also a pharmacist, were found guilty Monday in Manhattan federal court of conspiring to unlawfully distribute hundreds of thousands of pills of oxycodone at Stanley Pharmacy. HI JONG LEE was also convicted of conspiring to launder the proceeds of the unlawful oxycodone distribution and structuring cash deposits to avoid the filing of currency transaction reports (“CTRs”). The defendants were convicted on all counts following a two-week trial before U.S. District Judge Paul A. Crotty and a jury. Previously, on August 20, 2014, a third defendant, JI YUN LEE, the store manager at Stanley Pharmacy, pled guilty before Magistrate Judge Gabriel W. Gorenstein for his participation in the oxycodone distribution conspiracy.
Manhattan U.S. Attorney Preet Bharara said: “These three defendants turned their neighborhood pharmacy into an illegal drug spot where thousands of oxycodone pills were sold for cash to drug addicts and other drug dealers. This Office will continue to prosecute those individuals, including licensed pharmacists, who divert prescription medications for profit.”
According to the charging documents in this case and evidence presented at trial:
From in or about 2011 to in or about January 2013, JI YUN LEE, CHRISTINA CHAI and HI JONG LEE, operating out of Stanley Pharmacy, conspired to distribute large quantities of oxycodone to various individuals – including individuals addicted to oxycodone and individuals who intended to resell the drugs – pursuant to prescriptions that the defendants knew to be stolen, tampered with, or otherwise fraudulent, and that were not issued for a legitimate medical purpose. JI YUN LEE, the Stanley Pharmacy store manager, and not a licensed pharmacist, typically met with the oxycodone customers inside Stanley Pharmacy and delivered the filled prescriptions to them. Stanley Pharmacy charged over $1,000, in cash, for 180 30-milligram oxycodone pills, which was well in excess of the average price for a comparable quantity of lawfully prescribed oxycodone pills. CHAI, the only pharmacist on duty from Monday through Friday, filled over 1,000 fraudulent oxycodone prescriptions, including prescriptions that were obviously tampered with or stolen. HI JONG LEE, the owner of Stanley Pharmacy and its lone weekend pharmacist, deposited the majority of the bulk cash proceeds from the unlawful oxycodone distribution.
During the course of the conspiracy, the defendants distributed over 200,000 oxycodone tablets – over five million milligrams of oxycodone – pursuant to fraudulent prescriptions paid for in cash. In 2012, the quantity of oxycodone purchased by Stanley Pharmacy was more than double the quantity purchased by any other pharmacy in the same zip code.
In total, Stanley Pharmacy brought in over $1.3 million in cash proceeds from the illegal sale of oxycodone. Most of the proceeds were deposited into a bank account controlled by HI JONG LEE. HI JONG LEE, who was responsible for the banking activities of Stanley Pharmacy, regularly deposited the cash proceeds in amounts that, alone or in combination, were just under $10,000, thereby avoiding the required filing of a CTR.
CHRISTINA CHAI, 30, of Edgewater, New Jersey, was convicted of one count of conspiracy to distribute controlled substances. She faces a maximum sentence of 20 years in prison.
HI JONG LEE, 72, of New City, New York, was convicted of one count of conspiracy to distribute controlled substances, one count of conspiracy to commit money laundering, and one count of structuring cash transactions. In connection with the structuring conviction, the jury also found that HI JONG LEE engaged in structuring while violating another law of the United States or as part of a pattern of any illegal activity involving more than $100,000 in a 12-month period. He faces a maximum sentence of 50 years in prison.
JI YUN LEE, 45, of New City, New York, pled guilty to one count of conspiracy to distribute controlled substances. He faces a maximum sentence of 20 years in prison.
The 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. Sentencing dates have not yet been set.
Mr. Bharara praised the work of the DEA’s New York City Tactical Diversion Squad, which comprises members from the DEA, New York City Police Department, Westchester County Department of Public Safety, the New York State Insurance Bureau, the Rockland County Drug Task Force and the Internal Revenue Service. Mr. Bharara also thanked the Westchester County District Attorney’s Office, including members of the New York State Police, the Yonkers Police Department, and District Attorney Investigators, for their work on the investigation.
The case is being handled by the Office’s Narcotics Unit. Assistant U.S. Attorneys Elisha Kobre and Daniel Tehrani are in charge of the prosecution.
U.S. v. Ji Yun Lee et al. Indictment
Defendant Sentenced on Federal Firearm ChargeRead the Press Release
United States Attorney Kenyen R. Brown of the Southern District of Alabama announces today that Tony Lashone Gray of Mobile was sentenced following a June 2014 guilty plea to a charge of being a prohibited person in possession of a firearm. Gray was previously convicted of Possession of Cocaine in 2007 and 2012, and Theft of Property in 2000, in Mobile County Circuit Court. By virtue of these convictions, Gray is prohibited from possessing firearms or ammunition. Gray knowingly possessed a .45 caliber semiautomatic Glock pistol on December 23, 2013.
Possession of a firearm or ammunition by a previously convicted felon is a violation of Title 18, United States Code Section 922(g)(1). Chief United States District Court Judge William H. Steele imposed a 92 month sentence of imprisonment, to be followed by 3 years supervised release.
This case was referred for prosecution by the Mobile Police Department and investigated by Special Agent Nicholas P. Murphy of the Bureau of Alcohol, Tobacco, Firearms & Explosives.
Defendant Sentenced in Federal Firearm ChargeRead the Press Release
United States Attorney Kenyen R. Brown of the Southern District of Alabama announces today that Anthony Terrill Williams of Pensacola, Florida was sentenced following a June 2014 guilty plea to a charge of being a prohibited person in possession of a firearm. Williams was previously convicted of Possession of a Firearm by a Convicted Felon in 2011, in the Circuit Court of Escambia County, Florida. By virtue of prior felony convictions, Williams is prohibited from possessing firearms or ammunition. Williams knowingly possessed a .32 caliber revolver on August 2, 2013.
Possession of a firearm or ammunition by a previously convicted felon is a violation of Title 18, United States Code Section 922(g)(1). Chief United States District Court Judge William H. Steele imposed a 37 month sentence of imprisonment, to be followed by 3 years supervised release.
This case was referred for prosecution by Officer Rick Oliver of the Daphne Police Department. Assistance in research concerning the firearm was provided by the Bureau of Alcohol, Tobacco, Firearms & Explosives.
DOJ Awards Grants to Seattle and Educational Service District to Enhance School Safety and Combat Youth ViolenceRead the Press Release
Acting U.S. Attorney Annette L. Hayes announced today that the Puget Sound Educational Service District and the University of Washington will share a Department of Justice grant of nearly $1.5 million to improve school safety by early intervention with at-risk students. The grant is part of $63 million being awarded nationwide as part of the Comprehensive School Safety Initiative (CSSI). CSSI is a large-scale, multi-agency research effort to build knowledge about effective approaches to increasing school safety nationwide.
“This grant will help identify ways to keep at-risk kids in school and create safer schools for all,” said Acting U.S. Attorney Annette L. Hayes. “The University of Washington will take a rigorous look at the data on early interventions to identify programs that successfully prevent anti-social behavior before it starts.”
In addition to the research grant, the City of Seattle was awarded a $20,000 grant to become part of the National Forum on Youth Violence Prevention. As part of the program, Seattle is eligible for an additional $100,000 once it develops a plan to align and coordinate existing resources, engage in community outreach, and increase the engagement of youth, the faith community, law enforcement, victim services and others to combat youth violence.
Through the Comprehensive School Safety Initiative, the Office of Justice Programs’ National Institute of Justice (NIJ) is funding 24 research projects under two different solicitations. The first, “Investigator-Initiated Research,” includes nine awards to research organizations totaling more than $18 million. The second, “Developing Knowledge about What Works to Make Schools Safe,” provides more than $45 million to 15 school districts and their research partners. The Western Washington grant is in the second group.
“We know a great deal about how to make schools safe in general but very little about the specifics for various settings and populations,” said Dr. William J. Sabol, Acting Director of NIJ. “With this $63 million investment, the nation will gain an understanding of school safety that is scientifically sound, practical, and that can be easily interpreted and used by schools.”
President Obama’s January 2013 plan to end gun violence emphasized keeping guns out of potentially dangerous hands and recognized that additional actions are needed to make our schools safer. CSSI was launched in early 2014 in response to a Congressional request for a broad, research-based effort to increase safety in the nation’s schools.
The initiative has three primary goals: to collect national-level data; to convene stakeholders to identify and share best practices; and to conduct innovative research and evaluate pilot projects in school districts. The programs and policies within CSSI are designed to produce evidence about what works in such areas of school safety as effectiveness of school resource officers and mental health professionals, violence and bullying reduction, and effectiveness of such restorative justice interventions as youth courts. The initiative will also examine potential unintended consequences of school safety efforts, including the excessive use of exclusionary discipline and arrests of students.
Specifically, the grant to the Puget Sound Education Service District and the University of Washington calls for the evaluation of a three-step early warning and intervention process that identifies students at risk and matches effective, brief interventions to meet their needs. The process is designed to shift schools away from disproportionate, reactive and punitive discipline towards a more proactive and positive approach.The National Forum on Youth Violence Prevention aims to build a national conversation about youth and gang violence to increase awareness, drive action, and build local capacity to more effectively address youth violence. It models a new kind of federal and local collaboration, encouraging its members to change the way they do business by sharing common challenges and promising strategies, through comprehensive planning and coordinated action. Currently active in Boston, Chicago, Detroit, Memphis, and Salinas and San Jose, California, today DOJ announced the addition of Long Beach, California; Cleveland, Ohio; Louisville, Kentucky; Seattle, Washington; and Baltimore, Maryland.
Although NIJ has primary responsibility for CSSI, the program is a collaborative effort among more than 20 federal partners, including the Departments of Justice, Education, Health and Human Services, Homeland Security, and the Treasury. This partnership will allow the federal government to make a significant impact on school safety by investing limited funds in research that has practical applications for every school in the nation. By determining what interventions work best for specific schools and students, CSSI will provide professionals with a body of knowledge to help them make decisions about which programs will be most effective — and most cost effective — for their particular schools and their challenges.
A list of the awards and more information about CSSI are available at www.nij.gov, keywords: “School Safety.”
The Office of Justice Programs (OJP), headed by Assistant Attorney General Karol V. Mason provides federal leadership in developing the nation’s capacity to prevent and control crime, administer justice, and assist victims. OJP has six bureaus and offices: the Bureau of Justice Assistance; the Bureau of Justice Statistics; the National Institute of Justice; the Office of Juvenile Justice and Delinquency Prevention; the Office for Victims of Crime; and the Office of Sex Offender Sentencing, Monitoring, Apprehending, Registering, and Tracking (SMART).
Corrections Officer Admits Accepting Cash Bribes in Exchange for Smuggling Marijuana and Cell Phones into Federal Pretrial Detention FacilityRead the Press Release
TRENTON, N.J. – An Essex County corrections officer today admitted his involvement in a scheme to smuggle marijuana, cell phones and tobacco into the Essex County Jail, a federal pretrial detention facility, in exchange for cash bribe payments, U.S. Attorney Paul J. Fishman announced.
Stephon Solomon, 26, of Irvington, New Jersey, pleaded guilty before U.S. District Judge Mary L. Cooper in Trenton federal court to an information charging him with one count of conspiring to commit extortion under color of official right.
According to the documents filed in this and other cases and statements made in court:
On multiple occasions between October 2013 and May 2014, Solomon, a corrections officer at the Essex County Jail, smuggled contraband – including cell phones, tobacco, and marijuana – to Quasim Nichols, 29, a federal pretrial detainee at the Essex County Jail, in exchange for cash bribes. Darsell Davis, 29, and Dwayne Harper, 30, friends of Nichols, aided in the smuggling scheme by collecting the contraband to be smuggled into the jail. Solomon received the contraband and cash bribes from Davis and then smuggled the contraband to Nichols, who ultimately sold some of the marijuana and cell phones to other inmates. The inmates purchasing marijuana and cell phones from Nichols had their friends and family pay for the items by sending Western Union money transfers to Nichols, who enlisted Davis and others to retrieve those payments for him. Charges against Nichols, Davis and Harper are still pending.
The charge for conspiring to commit extortion under color of official right to which Solomon pleaded guilty carries a maximum penalty of 20 years in prison and a maximum fine of $250,000. Under terms of the plea agreement, Solomon will forfeit $4,000, representing his proceeds from the conspiracy. Sentencing is scheduled for Jan. 21, 2015.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark, and investigators with the Internal Affairs Division of Essex County Jail, under the leadership of Warden Roy Hendricks, with the investigation leading to today’s guilty plea.The government is represented by Assistant U.S. Attorneys Rahul Agarwal of the U.S. Attorney’s Office Special Prosecutions Division and Rob Frazer of the Criminal Division, Organized Crime/Gangs Unit, in Newark.
14-354Defense counsel: Jason Orlando Esq., Jersey City, N.J.
Solomon, Stephon Information
Convicted Bomb Plotter Sentenced to 30 YearsRead the Press Release
PORTLAND, Oregon. – Mohamed Osman Mohamud, 23, who was convicted in 2013 of attempting to use a weapon of mass destruction (explosives) in connection with a plot to detonate a vehicle bomb at an annual Christmas tree lighting ceremony in Portland, was sentenced today to serve 30 years in prison, followed by a lifetime term of supervised release.
Mohamud, a naturalized U.S. citizen from Somalia and former resident of Corvallis, Oregon, was arrested on Nov. 26, 2010, after he attempted to detonate what he believed to be an explosives-laden van that was parked near the tree lighting ceremony in Portland. The arrest was the culmination of a long-term undercover operation, during which Mohamud was monitored closely for months as his bomb plot developed. The device was in fact inert, and the public was never in danger from the device.
At sentencing, United States District Court Judge Garr M. King, who presided over Mohamed’s 14-day trial, said “the intended crime was horrific,” and that the defendant, even though he was presented with options by undercover FBI employees, “never once expressed a change of heart.” King further noted that the Christmas tree ceremony was attended by up to 10,000 people, and that the defendant “wanted everyone to leave either dead or injured.” King said his sentence was necessary in view of the seriousness of the crime and to serve as deterrence to others who might consider similar acts.
“With today’s sentencing, Mohamed Osman Mohamud is being held accountable for his attempted use of what he believed to be a massive bomb to attack innocent civilians attending a public Christmas tree lighting ceremony in Portland,” said John P. Carlin, Assistant Attorney General for National Security. “The evidence clearly indicated that Mohamud was intent on killing as many people as possible with his attack. Fortunately, law enforcement was able to identify him as a threat, insert themselves in the place of a terrorist that Mohamud was trying to contact, and thwart Mohamud’s efforts to conduct an attack on our soil. This case highlights how the use of undercover operations against would-be terrorists allows us to engage and disrupt those who wish to commit horrific acts of violence against the innocent public. The many agents, analysts, and prosecutors who have worked on this case deserve great credit for their roles in protecting Portland from the threat posed by this defendant and ensuring that he was brought to justice.”
“This trial provided a rare glimpse into the techniques Al Qaeda employs to radicalize home-grown extremists,” said Amanda Marshall, U.S. Attorney for the District of Oregon. “With the sentencing today, the court has held this defendant accountable. I thank the dedicated professionals in the law enforcement and intelligence communities who were responsible for this successful outcome. I look forward to our continued work with Muslim communities in Oregon who are committed to ensuring that all young people are safe from extremists who seek to radicalize others to engage in violence.”
According to the trial evidence, in February 2009, Mohamud began communicating via e-mail with Samir Khan, a now-deceased al Qaeda terrorist who published Jihad Recollections, an online magazine that advocated violent jihad, and who also published Inspire, the official magazine of al-Qaeda in the Arabian Peninsula. Between February and August 2009, Mohamed exchanged approximately 150 emails with Khan. Mohamud wrote several articles for Jihad Recollections that were published under assumed names.
In August 2009, Mohamud was in email contact with Amro Al-Ali, a Saudi national who was in Yemen at the time and is today in custody in Saudi Arabia for terrorism offenses. Al-Ali sent Mohamud detailed e-mails designed to facilitate Mohamud’s travel to Yemen to train for violent jihad. In December 2009, while Al-Ali was in the northwest frontier province of Pakistan, Mohamud and Al-Ali discussed the possibility of Mohamud traveling to Pakistan to join Al-Ali in terrorist activities. Mohamud responded to Al-Ali in an e-mail: “yes, that would be wonderful, just tell me what I need to do.” Al-Ali referred Mohamud to a second associate overseas and provided Mohamud with a name and email address to facilitate the process.
In the following months, Mohamud made several unsuccessful attempts to contact Al-Ali’s associate. Ultimately, an FBI undercover operative contacted Mohamud via email under the guise of being an associate of Al-Ali’s. Mohamud and the FBI undercover operative agreed to meet in Portland in July 2010. At the meeting, Mohamud told the FBI undercover operative he had written articles that were published in Jihad Recollections. Mohamud also said that he wanted to become “operational.” Asked what he meant by “operational,” Mohamud said he wanted to put an explosion together, but needed help.
According to evidence presented at trial, at a meeting in August 2010, Mohamud told undercover FBI operatives he had been thinking of committing violent jihad since the age of 15. Mohamud then told the undercover FBI operatives that he had identified a potential target for a bomb: the annual Christmas tree lighting ceremony in Portland’s Pioneer Courthouse Square on Nov. 26, 2010. The undercover FBI operatives cautioned Mohamud several times about the seriousness of this plan, noting there would be many people at the event, including children, and emphasized that Mohamud could abandon his attack plans at any time with no shame. Mohamud indicated the deaths would be justified and that he would not mind carrying out a suicide attack on the crowd.
According to evidence presented at trial, in the ensuing months Mohamud continued to express his interest in carrying out the attack and worked on logistics. On Nov. 4, 2010, Mohamud and the undercover FBI operatives traveled to a remote location in Lincoln County, Oregon, where they detonated a bomb concealed in a backpack as a trial run for the upcoming attack. During the drive back to Corvallis, Mohamud was asked if was capable looking at all the bodies of those who would be killed during the explosion. In response, Mohamud noted, “I want whoever is attending that event to be, to leave either dead or injured.” Mohamud later recorded a video of himself, with the assistance of the undercover FBI operatives, in which he read a statement that offered his rationale for his bomb attack.
On Nov. 18, 2010, undercover FBI operatives picked up Mohamud to travel to Portland to finalize the details of the attack. On Nov. 26, 2010, just hours before the planned attack, Mohamud examined the 1,800 pound bomb in the van and remarked that it was “beautiful.” Later that day, Mohamud was arrested after he attempted to remotely detonate the inert vehicle bomb rked near the Christmas tree lighting ceremony
This case was investigated by the FBI, with assistance from the Oregon State Police, the Corvallis Police Department, the Lincoln County Sheriff’s Office and the Portland Police Bureau. The prosecution was handled by Assistant U.S. Attorneys Ethan D. Knight and Pamala Holsinger from the U.S. Attorney’s Office for the District of Oregon. Trial Attorney Jolie F. Zimmerman, from the Counterterrorism Section of the Justice Department’s National Security Division, assisted.
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14-1077
Convicted Bomb Plotter Sentenced to 30 YearsRead the Press Release
PORTLAND, Oregon. –Mohamed Osman Mohamud, 23, who was convicted in 2013 of attempting to use a weapon of mass destruction (explosives) in connection with a plot to detonate a vehicle bomb at an annual Christmas tree lighting ceremony in Portland, was sentenced today to serve 30 years in prison, followed by a lifetime term of supervised release.
Mohamud, a naturalized U.S. citizen from Somalia and former resident of Corvallis, Oregon, was arrested on Nov. 26, 2010, after he attempted to detonate what he believed to be an explosives-laden van that was parked near the tree lighting ceremony in Portland. The arrest was the culmination of a long-term undercover operation, during which Mohamud was monitored closely for months as his bomb plot developed. The device was in fact inert, and the public was never in danger from the device.
At sentencing, United States District Court Judge Garr M. King, who presided over Mohamed’s 14-day trial, said “the intended crime was horrific,” and that the defendant, even though he was presented with options by undercover FBI employees, “never once expressed a change of heart.” King further noted that the Christmas tree ceremony was attended by up to 10,000 people, and that the defendant “wanted everyone to leave either dead or injured.” King said his sentence was necessary in view of the seriousness of the crime and to serve as deterrence to others who might consider similar acts.
“With today’s sentencing, Mohamed Osman Mohamud is being held accountable for his attempted use of what he believed to be a massive bomb to attack innocent civilians attending a public Christmas tree lighting ceremony in Portland,” said John P. Carlin, Assistant Attorney General for National Security. “The evidence clearly indicated that Mohamud was intent on killing as many people as possible with his attack. Fortunately, law enforcement was able to identify him as a threat, insert themselves in the place of a terrorist that Mohamud was trying to contact, and thwart Mohamud’s efforts to conduct an attack on our soil. This case highlights how the use of undercover operations against would-be terrorists allows us to engage and disrupt those who wish to commit horrific acts of violence against the innocent public. The many agents, analysts, and prosecutors who have worked on this case deserve great credit for their roles in protecting Portland from the threat posed by this defendant and ensuring that he was brought to justice.”
“This trial provided a rare glimpse into the techniques Al Qaeda employs to radicalize home-grown extremists,” said Amanda Marshall, U.S. Attorney for the District of Oregon. “With the sentencing today, the court has held this defendant accountable. I thank the dedicated professionals in the law enforcement and intelligence communities who were responsible for this successful outcome. I look forward to our continued work with Muslim communities in Oregon who are committed to ensuring that all young people are safe from extremists who seek to radicalize others to engage in violence.”
According to the trial evidence, in February 2009, Mohamud began communicating via e-mail with Samir Khan, a now-deceased al Qaeda terrorist who published Jihad Recollections, an online magazine that advocated violent jihad, and who also published Inspire, the official magazine of al-Qaeda in the Arabian Peninsula. Between February and August 2009, Mohamed exchanged approximately 150 emails with Khan. Mohamud wrote several articles for Jihad Recollections that were published under assumed names.
In August 2009, Mohamud was in email contact with Amro Al-Ali, a Saudi national who was in Yemen at the time and is today in custody in Saudi Arabia for terrorism offenses. Al-Ali sent Mohamud detailed e-mails designed to facilitate Mohamud’s travel to Yemen to train for violent jihad. In December 2009, while Al-Ali was in the northwest frontier province of Pakistan, Mohamud and Al-Ali discussed the possibility of Mohamud traveling to Pakistan to join Al-Ali in terrorist activities. Mohamud responded to Al-Ali in an e-mail: “yes, that would be wonderful, just tell me what I need to do.” Al-Ali referred Mohamud to a second associate overseas and provided Mohamud with a name and email address to facilitate the process.
In the following months, Mohamud made several unsuccessful attempts to contact Al-Ali’s associate. Ultimately, an FBI undercover operative contacted Mohamud via email under the guise of being an associate of Al-Ali’s. Mohamud and the FBI undercover operative agreed to meet in Portland in July 2010. At the meeting, Mohamud told the FBI undercover operative he had written articles that were published in Jihad Recollections. Mohamud also said that he wanted to become “operational.” Asked what he meant by “operational,” Mohamud said he wanted to put an explosion together, but needed help.
According to evidence presented at trial, at a meeting in August 2010, Mohamud told undercover FBI operatives he had been thinking of committing violent jihad since the age of 15. Mohamud then told the undercover FBI operatives that he had identified a potential target for a bomb: the annual Christmas tree lighting ceremony in Portland’s Pioneer Courthouse Square on Nov. 26, 2010. The undercover FBI operatives cautioned Mohamud several times about the seriousness of this plan, noting there would be many people at the event, including children, and emphasized that Mohamud could abandon his attack plans at any time with no shame. Mohamud indicated the deaths would be justified and that he would not mind carrying out a suicide attack on the crowd.
According to evidence presented at trial, in the ensuing months Mohamud continued to express his interest in carrying out the attack and worked on logistics. On Nov. 4, 2010, Mohamud and the undercover FBI operatives traveled to a remote location in Lincoln County, Oregon, where they detonated a bomb concealed in a backpack as a trial run for the upcoming attack. During the drive back to Corvallis, Mohamud was asked if he was capable of looking at all the bodies of those who would be killed during the explosion. In response, Mohamud noted, “I want whoever is attending that event to be, to leave either dead or injured.” Mohamud later recorded a video of himself, with the assistance of the undercover FBI operatives, in which he read a statement that offered his rationale for his bomb attack.
On Nov. 18, 2010, undercover FBI operatives picked up Mohamud to travel to Portland to finalize the details of the attack. On Nov. 26, 2010, just hours before the planned attack, Mohamud examined the 1,800 pound bomb in the van and remarked that it was “beautiful.” Later that day, Mohamud was arrested after he attempted to remotely detonate the inert vehicle bomb parked near the Christmas tree lighting ceremony
This case was investigated by the FBI, with assistance from the Oregon State Police, the Corvallis Police Department, the Lincoln County Sheriff’s Office and the Portland Police Bureau. The prosecution was handled by Assistant U.S. Attorneys Ethan D. Knight and Pamala Holsinger from the U.S. Attorney’s Office for the District of Oregon. Trial Attorney Jolie F. Zimmerman, from the Counterterrorism Section of the Justice Department’s National Security Division, assisted.
Convenience Store Operator Sentenced to 46 Months for Food Stamp FraudRead the Press Release
Last of Ten Store Owners Indicted in September
Sentenced for $1.2 Million in Fraud
Baltimore, Maryland – U.S. District Judge J. Frederick Motz sentenced Abdo Mohamed Nagi, age 55, a citizen of Yemen residing in Baltimore, today to 46 months in prison followed by three years of supervised release for two counts of food stamp fraud and six counts of wire fraud in connection with a scheme to illegally redeem food stamp benefits in exchange for cash. Judge Motz also entered an order that Nagi forfeit $1.2 million which he had illegally obtained from the food stamp program.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge William G. Squires, Jr. of the U.S. Department of Agriculture’s Office of Inspector General, Northeast Region; and Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation.“Abdo Mohamed Nagi collected $1,200,000 from the USDA food stamp program without providing any food,” said U.S. Attorney Rod J. Rosenstein. “He distributed $600,000 in cash to the ‘recipients’ and put $600,000 in cash into his own pocket.”
Nagi entered his guilty plea on the first day of his trial on July 21, 2014. According to the indictment to which he pleaded guilty, Nagi owned and operated New York Deli and Grocery, located at 1207 West Baltimore Street, in Baltimore. Through the store, Nagi participated in the Supplemental Nutrition Assistance Program (SNAP), previously known as the Food Stamp Program. In Maryland, the program provides eligible individuals with an electronic benefit transfer (EBT) card called the Independence Card, which operates like a debit card. Recipients obtain EBT cards through the state Department of Human Resources, then use the EBT card to purchase approved food items from participating retailers.
Nagi knew that it was a violation of SNAP regulations to trade cash for SNAP benefits. Nevertheless, from February 2011 through May 2013, Nagi exchanged SNAP benefits for cash at less than face value of the EBT benefits, in violation of the food stamp program rules. Typically, Nagi and kept up to 50 percent of the benefits for himself. To avoid detection, Nagi often debited funds in multiple transactions within minutes of each other. As a result of these illegal cash transactions, Nagi admitted that he obtained more than $1.2 million for food sales that never occurred.
Nagi split the proceeds with the SNAP recipients, keeping approximately $600,000 in illegal profits for himself and distributing $600,000 in cash to recipients.
In separate cases, all 10 convenience store owners or operators indicted in September 2013 in connection with schemes to illegally redeem food stamp benefits in exchange for cash have pleaded guilty to food stamp fraud and/or wire fraud, and all have sentenced to up to 38 months in prison. These defendants were also ordered to pay forfeiture of up to $371,439.21, and/or restitution of up to $1.4 million.
Two more retailers, Abdulmalik Abdulla, age 37, and Ahmed Mohssen, age 54, both of Baltimore, were indicted in January 2014. A federal jury convicted them of food stamp fraud and wire fraud on August 8, 2014, following a four day trial. They are scheduled to be sentenced on November 14, 2014.
United States Attorney Rod J. Rosenstein praised USDA’s Office of Inspector General and FBI for their work in the investigation. U.S. Attorney Rosenstein expressed appreciation to Secretary Ted Dallas and the Maryland Department of Human Resources, as well as U.S. Citizenship and Immigration Services - Office of Fraud Detection and National Security for their assistance in the investigation. Mr. Rosenstein thanked Assistant United States Attorney Leo J. Wise, who prosecuted this case.
Columbus County Schools Receive National Institute of Justice Comprehensive School Safety Initiative GrantRead the Press Release
RALEIGH - United States Attorney Thomas G. Walker announced today that the Office of Justice Programs’ National Institute of Justice (NIJ) has awarded nearly $63 million to school districts and research organizations through the Comprehensive School Safety Initiative (CSSI). CSSI is a large-scale, multi-agency research effort to build knowledge about effective approaches to increasing school safety nationwide.
Columbus County Schools received $1,499,019 and will partner with Robeson County Schools. The purpose of the proposed 3-year research project is to implement and evaluate a restorative justice school safety initiative that 1) reduces bullying perpetration and victimization, aggression, and violence, 2) enhances school safety and mental health in middle and high school students, and 3) reduces the school to prison pipeline by diverting first offenders from the juvenile justice system into school-based Teen Courts for middle and high schools. The study will be conducted in Columbus and Robeson County. Both of these counties are rural, impoverished and ethnically diverse. Staff from the North Carolina Academic Center for Excellence in Youth Prevention will complete the research evaluation. NC-ACE is one of six CDC-funded youth prevention centers and the only one working in rural areas. Robeson County Teen Court and Youth Services is an agency implementing evidenced-based models of restorative justice programming and will coordinate implementation fidelity for the proposed project.
“This funding is being awarded as part of the Comprehensive School Safety Initiative – a large-scale, multi-agency research effort to build practical, and scientifically-sound, knowledge about effective ways to increase school safety nationwide,” said Attorney General Eric Holder. “These collaborative efforts will yield new insights and evidence about what works – and what doesn’t – when it comes to school discipline, violence and bullying reduction, school resource officers, mental health professionals and justice interventions like youth courts.”
Through the Initiative, 24 research projects receive funding under two different solicitations. The first, “Investigator-Initiated Research,” includes nine awards to research organizations totaling more than $18 million. The second, “Developing Knowledge about What Works to Make Schools Safe,” provides more than $45 million to 15 school districts and their research partners.
“We know a great deal about how to make schools safe in general but very little about the specifics for various settings and populations,” said Dr. William J. Sabol, Acting Director of NIJ. “With this $63 million investment, the nation will gain an understanding of school safety that is scientifically sound, practical, and that can be easily interpreted and used by schools.”
President Obama’s January 2013 plan to end gun violence emphasized keeping guns out of potentially dangerous hands and recognized that additional actions are needed to make our schools safer. CSSI was launched in early 2014 in response to a Congressional request for a broad, research-based effort to increase safety in the nation’s schools.
The initiative has three primary goals: to collect national-level data; to convene stakeholders to identify and share best practices; and to conduct innovative research and evaluate pilot projects in school districts. The programs and policies within CSSI are designed to produce evidence about what works in such areas of school safety as effectiveness of school resource officers and mental health professionals, violence and bullying reduction, and effectiveness of such restorative justice interventions as youth courts. The initiative will also examine potential unintended consequences of school safety efforts, including the excessive use of exclusionary discipline and arrests of students.
Although NIJ has primary responsibility for CSSI, the program is a collaborative effort among more than 20 federal partners, including the Departments of Justice, Education, Health and Human Services, Homeland Security, and the Treasury. This partnership will allow the federal government to make a significant impact on school safety by investing limited funds in research that has practical applications for every school in the nation. By determining what interventions work best for specific schools and students, CSSI will provide professionals with a body of knowledge to help them make decisions about which programs will be most effective — and most cost effective — for their particular schools and their challenges.
A list of the awards and more information about CSSI are available at www.nij.gov, keywords: “School Safety.”
The Office of Justice Programs (OJP), headed by Assistant Attorney General Karol V. Mason provides federal leadership in developing the nation’s capacity to prevent and control crime, administer justice, and assist victims. OJP has six bureaus and offices: the Bureau of Justice Assistance; the Bureau of Justice Statistics; the National Institute of Justice; the Office of Juvenile Justice and Delinquency Prevention; the Office for Victims of Crime; and the Office of Sex Offender Sentencing, Monitoring, Apprehending, Registering, and Tracking (SMART).
Business Owner Sentenced for Wire FraudRead the Press Release
RALEIGH – United States Attorney Thomas G. Walker announced that today in federal court, HILDA PARKER , 57, of Goldsboro, North Carolina, was sentenced to 12 months and 1 day imprisonment followed by 3 years of supervised release for wire fraud by Chief United States District Judge James C. Dever III. She was also ordered to pay $128,983.45 in restitution due in full immediately. PARKER previously pled guilty to that charge on May 22, 2014.
According to information in the public record, HILDA PARKER owned and operated Parker Products, which operated as a broker of goods for the Defense Logistics Agency (“DLA”). Between April 2007 and December 2007, Parker Products was awarded 217 purchase orders valued at $346,508.26 under a streamlined fast-pay purchase system. With respect to 29 of the 217 purchase orders (total value of $128,983.45), Parker Products failed to deliver the goods ordered. HILDA PARKER, however falsely verified via wire shipment of the goods and received payments in connection with those 29 purchase orders. Because of the fast-pay purchase system, DLA made payment on the verification rather than actual receipt of the goods ordered.
Some of the items ordered through HILDA PARKER d/b/a/ Parker Products, Inc. were mission critical. According to Betty J. Lavery, Contracting Officer for the Defense Logistics Agency Land and Maritime, one of the undelivered purchase orders was identified an “emergency buy” – a designation reserved for an acquisition so urgently needed that a delay would result in a “serious injury” to the Government. Specifically, PARKER failed to deliver a repair/replacement part needed in a Light Armored Vehicle (LAV) operated by the U.S. Marine Corps and which was scheduled to be loaded aboard a ship leaving for Iraq. Her failure to deliver the needed part by the delivery date, as well as her other delivery failures, resulted in the degradation of operational readiness for a number of military units.
The criminal investigation of this case was conducted by Defense Criminal Investigation Service. Assistant United States Attorney Banumathi Rangarajan is handling the prosecution of the case.
Buffalo man sentenced for money launderingRead the Press Release
BUFFALO, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that Henry Lloyd, 28, of Buffalo, N.Y., who was convicted of conspiracy to commit money laundering, was sentenced to 46 months in prison by U.S. District Judge Richard J. Arcara.
Assistant U.S. Attorney George C. Burgasser, who handled the case, stated that Lloyd conspired with others to transport $364,000 in a vehicle equipped with a hidden compartment where the money was secreted. The vehicle was stopped in eastern Texas where law enforcement officers discovered and seized the currency. Lloyd admitted the money was going to be used to buy cocaine. As part of the conspiracy, the defendant laundered $34,000 in drug proceeds to purchase vehicles from a local car dealer.
The case is related to a multi-kilogram cocaine distribution network between Buffalo and Houston, Texas. Twenty defendants were arrested in that case and to date, 19 have been convicted.
The sentencing is the culmination of an investigation on the part of Special Agents of the Federal Bureau of Investigation Safe Streets Task Force, the Drug Enforcement Administration, under the direction of James J. Hunt, Acting Special Agent in Charge, New York Field Division, and the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge James S. Higgins, New York Field Field Division.Brunswick Man Pleads Guilty to Crack Cocaine TraffickingRead the Press Release
Contact: Darcie N. McElwee
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced that Garry
Collins, 46, of Brunswick, Maine, pleaded guilty today, in U.S. District Court in Portland to
possession with intent to distribute more than 28 grams of cocaine base.According to evidence presented at the plea hearing, on June 3, 2013, Collins and others
packaged crack cocaine for distribution at a Portland hotel. The next day, he was found by
Portland Police officers with crack cocaine and arrested.
Collins faces between 10 years and life in prison. He will be sentenced after completion
of a presentence investigation report by the U.S. Probation Office.
The investigation was conducted by the Portland Police Department, the Maine Drug
Enforcement Agency and the Federal Bureau of Investigation.