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3 October 2014
Maryland Man Sentenced to 14-Year Prison Term for Sexually Abusing Subordinate Food Services EmployeeAttacks Took Place at Federal Building in Washington, D.C.Read the Press Release
WASHINGTON – Alexander Hughes, 35, of Odenton, Md., was sentenced today to 14 years in prison for sexually abusing a subordinate employee in the cafeteria of a federal building where they worked in Northwest Washington, U.S. Attorney Ronald C. Machen Jr. announced.
Hughes was found guilty in May 2014, following a trial in the Superior Court of the District of Columbia, of one count of kidnapping, one count of first-degree sexual abuse with aggravating circumstances, three counts of second-degree sexual abuse with aggravating circumstances, and numerous counts of misdemeanor sexual abuse with aggravating circumstances. He was sentenced by the Honorable John Ramsey Johnson. Upon completion of his prison term, Hughes will be placed on five years of supervised release. He also must register as a sex offender for the rest of his life.
According to the government’s evidence, Hughes was a contract employee who worked as a food services supervisor at the U.S. Department of Homeland Security on Nebraska Avenue NW. The victim was one of the food preparation employees. Between December 2011 and December 2012, Hughes engaged in numerous acts of sexual abuse in various locations within the cafeteria, including an employee changing room and restroom.
Hughes engaged in this conduct by force, as well as by telling the victim on numerous occasions that he could have her fired if she did not submit to his sexual acts. The victim, who felt totally helpless, eventually got the courage to report the sexual abuse, leading to a law enforcement investigation and Hughes’s arrest. According to the government’s evidence, Hughes also had sexually abused the victim and two other female subordinate employees by hitting them on the buttocks with various items, including cooking utensils, while they worked.
In announcing the sentence, U.S. Attorney Machen commended the work of detectives from the Metropolitan Police Department’s Sexual Assault Unit and Mobile Crime Division, and law enforcement officers with the U.S. Department of Homeland Security. He also praised the efforts of those who handled the case for the U.S. Attorney’s Office, including Victim/Witness Advocate Melissa Milam; Victim/Witness Security Specialists Katina Adams-Washington and David Foster; Paralegal Specialists Jason Manuel and Joyce Arthur; Joshua Ellen, Joseph Calvarese, Kimberly Smith, and the Litigation Services team, and Assistant U.S. Attorneys Amy Zubrensky, who investigated and tried the case, and Rebekah Holman, who co-tried the case.
14-225Loan Officer at TARP Bank and Accomplice Sentenced for Bank Related FraudRead the Press Release
DENVER – Two men who defrauded a bank that received Troubled Asset Relief Program (TARP) funds were sentenced this week for their criminal conduct, the U.S. Attorney’s Office for the District of Colorado and the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) announced. Christopher Tumbaga, age 37, of Colorado Springs, Colorado a bank loan officer was sentenced by U.S. District Court Judge William J. Martinez to serve 36 months in federal prison, followed by 4 years on supervised release. Tumbaga was also ordered to pay $1,055,918 in restitution to the United States for his crimes of bank fraud and illegally receiving kickbacks. Co-defendant Brian Headle, age 38, also of Colorado Springs, Colorado, was sentenced by Judge Martinez to serve 36 months in prison, followed by 4 years on supervised release for his crime of corruptly influencing a bank officer. He was ordered to pay the $1,055,918 in restitution to the government joint and several with Tumbaga.
Tumbaga and Headle were indicted by a federal grand jury in Denver on September 25, 2013. Tumbaga pled guilty on March 24, 2014. He was sentenced on September 30, 2014. Headle pled guilty on June 26, 2014. He was sentenced on October 3, 2014.
According to court documents, Tumbaga was employed as a loan officer at Colorado East Bank & Trust (Colorado East). From approximately March 2009 to July 2011, Tumbaga obtained more than 14 loans and misapplied funds from a line of credit for the benefit of a high school friend, co-defendant Brian Headle.
In March 2009, Headle contacted Tumbaga to discuss securing a loan or line of credit from Colorado East to finance Headle’s real estate development business. Tumbaga subsequently secured a $250,000 line of credit for Headle based on allegedly false financial information provided by Headle to Tumbaga that Tumbaga intentionally failed to verify. Shortly after, Tumbaga and Headle formed a partnership in which Tumbaga would secure fraudulent loans for Headle’s benefit, and in return, Tumbaga would receive from Headle kickbacks financed by profits from Headle’s real estate venture.
In order to obscure that the loans were intended entirely for Headle’s benefit, Tumbaga obtained the loans in multiple names. Loans were obtained in the name of Headle’s company, Investment One LLC; Headle’s wife; and Headle’s wife’s company. When additional loans were needed in order to maintain payments on outstanding loans, Tumbaga obtained fraudulent loans in the names of Headle’s parents and step-parent. When approval for a loan was needed from the bank’s president, Tumbaga forged the bank president’s signature. Additionally, in one instance, Tumbaga withdrew $100,000 from a bank customer’s line of credit and wired the money to Headle, all unbeknownst to the bank customer. Over the course of the bank fraud scheme, Tumbaga obtained approximately $1.2 million from Colorado East for Headle’s benefit, and Tumbaga purportedly received more than $60,000 in kickbacks from Headle.
“The TARP program was designed to protect our economy by protecting banking institutions from fraud,” said U.S. Attorney John Walsh. “When an officer of a bank defrauds that institution, we will aggressively prosecute and seek to incarcerate those responsible.”
“While taxpayers bailed out Colorado East bank with $10 million in TARP bailout funds, bank loan officer Tumbaga chose to break the law, actively scheming with high school pal Headle to defraud the bank out of $1 million in loans,” said Christy Romero, Special Inspector General for TARP (SIGTARP). “This crime could not have happened without a bank gatekeeper like Tumbaga, who opened the door to Headle while taxpayers ended up losing $2 million on their TARP investment.”
In February 2009, ColoEast Bankshares, Inc. the parent company of Colorado East Bank & Trust, received $10 million in federal taxpayer funds through the U.S. Department of the Treasury Troubled Asset Relief Program (TARP). The bank was later unable to pay more than $1 million it owed to taxpayers as a result of holding the TARP funds. In July 2013, the Treasury Department sold its stake in the company at auction for approximately $9 million. In total, approximately $2 million owed to federal taxpayers was lost on the investment.
This case was investigated by SIGTARP, the Federal Deposit Insurance Corporation Office of the Inspector General, and the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorney Suneeta Hazra.
This prosecution was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force, which was established to wage an aggressive and coordinated effort to investigate and prosecute financial crimes. SIGTARP is a member of the task force. To learn more about the President’s Financial Fraud Enforcement Task Force, please visit www.StopFraud.gov.
About SIGTARP
The Office of the Special Inspector General for the Troubled Asset Relief Program investigates fraud, waste, and abuse in connection with TARP.
To report suspected illicit activity involving TARP, dial the SIGTARP Hotline: 1-877-SIG-2009 (1-877-744-2009).
To receive alerts about quarterly reports, new audits, and media releases issued by SIGTARP, sign up at www.SIGTARP.gov/pages/press.aspx. Follow SIGTARP on Twitter @SIGTARP.
- Katy Man Guilty of Attempted Robbery and Solicitation to Commit A Crime of Violence
Justice Department Settles Lawsuit Against Key Safety Systems, Inc. to Enforce Employment Rights of United States Army National Guard MemberRead the Press Release
The Justice Department’s Civil Rights Division and U. S. Attorney A. Lee Bentley III for the Middle District of Florida announced today that they reached an agreement with Key Safety Systems Inc. resolving claims that Key Safety Systems violated the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA) by demoting U.S. Army National Guard Member Ronald Collins Jr. following the announcement of his military deployment.
According to the complaint, filed in the United States District Court for the Middle District of Florida, in October 2012, Collins notified Key Safety Systems that he was being deployed in February 2013 for one year of military service. In December 2012, Collins was notified by Key Safety Systems that, effective immediately, he was being demoted, which resulted in a reduction in pay. According to the complaint, Collins had not been the subject of any disciplinary actions prior to the announcement of his impending deployment.
The complaint further alleged that, at the time of the demotion, Collins was not provided any basis underlying the decision to demote him. In January 2014, Collins returned from deployment and was returned to the position to which he had been demoted at Key Safety Systems. Collins submitted his letter of resignation to Key Safety Systems in February 2014.
USERRA protects the rights of uniformed servicemembers to retain their civilian employment following absences due to military service obligations, and provides that servicemembers shall not be discriminated against because of their military obligations.
“Congress enacted USERRA to protect our men and women in uniform,” said Acting Assistant Attorney General Molly Moran for the Civil Rights Division. “Mr. Collins, like many members of the National Guard and Reserve, was called upon by his country in a time of need and the Department of Justice strongly supports the rights of service members to reclaim their rightful positions in the workforce after they complete their military service.”
Under the terms of the settlement, which was filed as a consent decree simultaneously with the complaint, Key Safety Systems has agreed to pay $20,000 as back pay and liquidated damages to Collins.
“Members of the United States Army National Guard are often called to make many sacrifices, including spending months or years away from their jobs and families,” said U.S. Attorney Bentley. “When they are deployed in the service of our country, their employment rights must be protected. Our office and the entire Department of Justice are committed to ensuring that individuals do not lose their rights while they are protecting ours.”
This case stems from a referral by the U.S. Department of Labor (DOL), pursuant to an investigation by the DOL’s Veterans’ Employment and Training Service. The case is being handled by the Employment Litigation Section of the Department of Justice’s Civil Rights Division and the U.S. Attorney’s Office for the Middle District of Florida, who work collaboratively with the DOL to protect the jobs and benefits of National Guard and Reserve servicemembers upon their return to civilian life.
The Justice Department’s Civil Rights Division has given a high priority to the enforcement of service members’ rights under USERRA. Additional information about USERRA can be found on the Justice Department’s websites at www.usdoj.gov/crt/emp and www.servicemembers.gov, as well as on the Labor Department’s website at www.dol.gov/vets/programs/userra/main.htm.
Justice Department Files Suit Against New Jersey Company for Adulterated and Misbranded Medical DevicesRead the Press Release
The Department of Justice announced today that the department, on behalf of the Food and Drug Administration (FDA), has filed suit in the U.S. District Court for the District of New Jersey against Pharmaceutical Innovations Inc. and Gilbert Buchalter, who is the company’s founder, owner, and chairman of the board.
According to the complaint, the defendants violated the Federal Food, Drug and Cosmetic Act (FDCA) by manufacturing and distributing adulterated and misbranded medical devices. The devices at issue are gels that hospitals and other caregivers use to take ultrasound scans. Under the FDCA, a device manufacturer must: comply with current good manufacturing practice requirements; obtain required premarket approval or clearance before distributing its devices and notify the FDA and follow-up on any reports of serious injuries or deaths associated with its devices. The government alleges that the company violated each of these requirements.
“This action furthers the FDA’s mission of ensuring that all medical devices sold to hospitals and other caregivers are produced in conformance with current good manufacturing practice requirements,” said Acting Assistant Attorney General for the Civil Division Joyce R. Branda. “Device manufacturers who undermine this mission will be held accountable.”
“Patients should be able to have confidence that the healthcare products they use are safe,” said U.S. Attorney Paul J. Fishman for the District of New Jersey. “Actions like the one we are taking here reinforce the law that manufacturers adhere to strict approval and production requirements. We are committed to stopping those who don’t.”
The complaint alleges that FDA inspections at Pharmaceutical Innovations’ Newark, New Jersey, facility have identified numerous and repeated deviations from current good manufacturing practices, including that the company has failed to show that it: validated its dry heat sterilization and dry heat treatment processes; routinely monitors its water systems to ensure that the water is suitable for manufacturing medical devices and routinely sanitizes the tubing and connections of its water systems to ensure objectionable microorganisms do not reside in the inner piping surface. The complaint further alleges that Pharmaceutical Innovations has not sought FDA approval or clearance for the new ultrasound gels it has brought into the market. As a result, according to the complaint, the defendants’ products are adulterated and misbranded devices under the FDCA.
The complaint alleges that, in February 2012, a Michigan hospital reported that it had traced infections among 16 surgical patients to a specific gel made by Pharmaceutical Innovations. However, the company failed to submit a medical device report to the FDA after becoming aware of these infections as required by law. FDA testing on samples of that gel identified bacterial contamination. The relevant lots of Pharmaceutical Innovations’ ultrasound gel were seized by the U.S. Marshals Service, following a seizure lawsuit filed by the United States.
The complaint alleges that, despite numerous warnings from FDA, the defendants have failed to bring their operations into compliance with the law. The Justice Department will seek a permanent injunction requiring the defendants to cease manufacturing, processing, packing, labeling, holding and distributing devices until they comply with the FDCA and applicable FDA regulations.
The FDA referred this matter to the Justice Department. The Consumer Protection Branch of the Civil Division filed this case on behalf of the United States.
A complaint is merely a set of allegations that, if the case were to proceed to trial, the government would need to prove by a preponderance of the evidence.
Justice Department Files Suit Against New Jersey Company for Adulterated and Misbranded Medical DevicesRead the Press Release
WASHINGTON – The Justice Department, on behalf of the Food and Drug Administration (FDA), has filed suit in the U.S. District Court for the District of New Jersey against Pharmaceutical Innovations Inc. and its president Gilbert Buchalter, New Jersey U.S. Attorney Paul J. Fishman and Acting Assistant Attorney General Joyce R. Branda for the department’s Civil Division, announced today.
According to the complaint, the defendants violated the Federal Food, Drug and Cosmetic Act (FDCA) by manufacturing and distributing adulterated and misbranded medical devices. The devices at issue are gels that hospitals and other caregivers use to take ultrasound scans. Under the FDCA, a device manufacturer must: comply with current good manufacturing practice requirements; obtain required premarket approval or clearance before distributing its devices and notify the FDA and follow-up on any reports of serious injuries or deaths associated with its devices. The government alleges that the company violated each of these requirements.
“Patients should be able to have confidence that the healthcare products they use are safe,” U.S. Attorney Fishman said. “Actions like the one we are taking here reinforce the law that manufacturers adhere to strict approval and production requirements. We are committed to stopping those who don’t.”
“Today’s action furthers the FDA’s mission of ensuring that all medical devices sold to hospitals and other caregivers are produced in conformance with current good manufacturing practice requirements,” said Acting Assistant Attorney General Branda. “Device manufacturers who undermine this mission will be held accountable.” (DRAFT)
The complaint alleges that FDA inspections at Pharmaceutical Innovations’ Newark, New Jersey, facility have identified numerous and repeated deviations from current good manufacturing practices, including that the company has failed to show that it: validated its dry heat sterilization and dry heat treatment processes; routinely monitors its water systems to ensure that the water is suitable for manufacturing medical devices and routinely sanitizes the tubing and connections of its water systems to ensure objectionable microorganisms do not reside in the inner piping surface. The complaint further alleges that Pharmaceutical Innovations has not sought FDA approval or clearance for the new ultrasound gels it has brought into the market. As a result, according to the complaint, the defendants’ products are adulterated and misbranded devices under the FDCA.
According to the complaint, in February 2012, a Michigan hospital reported that it had traced infections among 16 surgical patients to a specific gel made by Pharmaceutical Innovations. However, the company failed to submit a medical device report to the FDA after becoming aware of these infections as required by law. FDA testing on samples of that gel identified bacterial contamination, and after the United States filed a seizure lawsuit, relevant lots of Pharmaceutical Innovations’ ultrasound gel were seized by the U.S. Marshals Service.
The complaint alleges that, despite numerous warnings from FDA, the defendants have failed to bring their operations into compliance with the law. The Justice Department will seek a permanent injunction requiring the defendants to cease manufacturing, processing, packing, labeling, holding and distributing devices until they comply with the FDCA and applicable FDA regulations.
The FDA referred this matter to the Justice Department. The Consumer Protection Branch of the Civil Division and the U.S. Attorney’s Office for the District of New Jersey filed this case on behalf of the United States.
The government is represented by Trial Attorney Daniel Crane-Hirsch of the Consumer Protection Branch, Assistant U.S. Attorney Lucy Muzzy of the U.S. Attorney's Office's Health Care and Government Fraud Unit, and Associate Chief Counsel Julie Dohm of FDA's Office of Chief Counsel.
A complaint is merely a set of allegations that, if the case were to proceed to trial, the government would need to prove by a preponderance of the evidence.
14-357
Pharmaceutical Innovations Complaint
Jury Convicts Former Lafayette Postal Service Employee for Stealing Gift Cards from U.S. MailRead the Press Release
LAFAYETTE, La. –United States Attorney Stephanie A. Finley announced that, after a three-day trial, a federal jury found a Lafayette woman guilty of taking gift cards from U.S. mail.
After deliberating for a little over an hour, a federal jury found Crystal S. Boutte, 41, of Lafayette, guilty on two counts of theft of mail. United States District Judge Richard T. Haik presided over the trial that ended on Wednesday. In December of 2012, Boutte stole four Wal-Mart gift cards from the mail while working for the U.S. Postal Service. One gift card was worth $200, and the other three were worth $25 each. The theft was discovered after the recipients of the mail reported the cards missing.
“Ms. Boutte was a postal employee who took advantage of and abused her position,” Finley stated. “Private citizens should not have to worry about their mail being stolen by those entrusted to deliver it.”
“The American public expects to receive their letters and parcels on time and intact,” said Maximo Eamiguel, Office of Inspector General, Special Agent in Charge, Southern Area Field Office. “Citizens have an expectation that their mail will not be stolen, rifled, read or obstructed while in the possession of Postal Service employees. That expectation and trust extends to every one of the millions of mail pieces that travel across the country daily. Anyone who betrays that trust will be thoroughly investigated by OIG special agents. The Postal Service has a long and proud tradition of protecting the ‘sanctity of the seal’ of First-Class Mail. The overwhelming majority of postal employees perpetuate this tradition every day in their efforts to move the nation’s mail to its proper destination. Unfortunately, when a few postal employees abuse the public trust placed in them, it is the job of OIG special agents to identify them and work in cooperation with the U.S. Attorney’s Office to ensure they are prosecuted in the criminal courts.”
Boutte faces five years in prison, three years of supervised release, restitution, and a $250,000 fine for each count. The U.S. Postal Service, Office of Inspector General, conducted the investigation. Assistant U.S. Attorney Howard C. Parker prosecuted the case.
Jasper County Woman Sentenced to Fourteen Years in Prison on Methamphetamine ChargesRead the Press Release
Follow @SDILNewsStephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today that Rebecca A. Moore, 37, of Yale, (Jasper County) Illinois, was sentenced to 168 months (14 years) in federal prison, to be followed by five years of supervised release following her imprisonment, and fined $400. Moore had previously pleaded guilty to two counts in a federal indictment. Count 1 charged that Moore, Ashley M. Attaway, 29, of Yale, Illinois, David C. Halterman, 44, of Yale, Illinois, and Ricky Lee Roberts, II, 39, of Franklin, Indiana, conspired to knowingly and intentionally distribute methamphetamine. Count 3 charged that from April 2013 to October 12, 2013, in Jasper County, Moore did knowingly maintain a residence located in Yale, Illinois, for the purpose of using and distributing methamphetamine.
Co-defendant Attaway was previously sentenced to 188 months in prison. Co-defendants Halterman and Roberts are set for trial on November 3, 2014. As to them, a defendant is presumed to be innocent of a charge until proved guilty beyond a reasonable doubt to the satisfaction of a jury.
The investigation in this case was conducted by the Jasper County Sheriff’s Department, the Crawford County Sheriff’s Department, and the Bureau of Alcohol, Tobacco, and Firearms. The Jasper County State’s Attorney’s Office has assisted throughout the investigation in this case.
The case is being handled by Assistant United States Attorney George Norwood.
Ingham County Child Sex Trafficking Ring BustedRead the Press Release
GRAND RAPIDS, MICHIGAN – The U.S. Attorney for the Western District of Michigan, the Federal Bureau of Investigation, the Ingham County Prosecutor’s Office, the Ingham County Sheriff’s Office, and the Lansing Police Department announced today that three people have been charged and arrested with operating a child sex trafficking ring in Lansing, Michigan. A federal grand jury for the Western District of Michigan indicted Christopher T. Bryant, 24, of Detroit on five counts, including sex trafficking of minors; sex trafficking by force, fraud, or coercion; and interstate transportation for the purposes of prostitution. The Ingham County Prosecutor’s Office charged Mariah Haughton, 17, and Jonathan Purnell, 27, both of Lansing, for sex trafficking girls in the same ring.
The federal indictment charges Bryant with sex trafficking three minors – including one by force, fraud, or coercion – in Ingham County and elsewhere from March through July 2014. It also charges Bryant with transporting another person from Michigan to Arizona in August 2012 for prostitution, and then sex trafficking the same person by force, fraud, or coercion in early September of that year.
The Ingham County Prosecutor’s Office charged Haughton on multiple counts, including human trafficking by recruiting minors for child sexually abusive activity. Although Haughton is only 17 years old, a federal search warrant indicates that Haughton was active in recruiting and trafficking girls for commercial sex. Purnell was arrested today in Ingham County on similar charges.
The FBI alleges in a federal search warrant application that Bryant, Haughton, and Purnell recruited minors and advertised them online to solicit sex for money. The search warrant alleges that the ring operated out of an apartment and various motels around Lansing. Allegedly, Bryant, Haughton, and Purnell provided the minors with alcohol and drugs and profited from the enterprise.
This is the second child sex trafficking case to be charged federally in the Western District of Michigan. The first federal case in this district was against Eddie Allen Jackson in April 2014 for sex trafficking three girls ages 14, 15, and 16 in Grand Rapids. Jackson was sentenced earlier this month to 30 years in federal prison.
“The crime of child sex trafficking is not new, but it is growing in part because the internet makes it easy to advertise sex anonymously. People selling children into commercial sex feel as though they cannot be found or traced, which is not the case. Awareness of the issue of human trafficking is spreading rapidly throughout West Michigan, and I am pleased local, state, and federal authorities are working together effectively to locate and stop alleged sex traffickers,” said U.S. Attorney Patrick A. Miles, Jr.
“Trafficking children for sexual exploitation is a horrific crime, and one which we are dedicated to fighting against relentlessly,” said Paul M. Abbate, Special Agent in Charge of the FBI Detroit Field Office. “The FBI, in concert with its local, state and federal partners, remains steadfast in its resolve to protect the innocence of our children. Offenders like the perpetrators in this investigation must know that law enforcement will stop at nothing, and use every resource available, to fight for the interests of our young people and bring justice to bear upon those seeking to exploit their vulnerabilities."
“I’m proud of the men and women of the Lansing Police Department who were a part of this extensive investigation. Working and collaborating on investigating crime with other jurisdictions, from Federal to the State level, has always been a success,” said Lansing Police Chief Mike Yankowski.
“This insidious crime has been made much easier due to the internet. I am proud to say that our investigators – City, County, and Federal – put together a great team that was able to meet the challenge and make the appropriate arrests. We all need to continue vigilance, however, especially parents need to monitor their children’s internet use and report suspicious activity,” said Ingham County Sheriff Gene Wriggelsworth.
The federal case, which is part of Project Safe Childhood – a nationwide initiative designed to protect children from exploitation and abuse – is being prosecuted by Assistant United States Attorneys Tessa K. Hessmiller and Russell A. Kavalhuna. The U.S. Attorney's Office; county prosecutor's offices; the Internet Crimes Against Children task force (ICAC); and federal, state, and local law enforcement are working closely together to locate, apprehend, and prosecute individuals who exploit children. The partners in Project Safe Childhood work to educate communities about the dangers of online child exploitation and to teach children how to protect themselves. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov. Individuals with information or concerns about possible child exploitation should contact local law enforcement.
The charges in an indictment are merely accusations, and a defendant is presumed innocent until and unless proven guilty in a court of law..
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Immigration Official Sentenced to 30 Months in Prison for Soliciting Bribes to Approve Applications for Citizenship and 'Green Card'Read the Press Release
SANTA ANA, California – An immigration service officer with U.S. Citizenship and Immigration Services (USCIS) who took thousands of dollars in bribes from immigrants who were seeking either citizenship or lawful permanent resident status in the United States was sentenced today to 30 months in federal prison.
Mai Nhu Nguyen, 48, of Irvine, was sentenced by United States District Judge Josephine L. Staton.
From 2011 through June 2013, Nguyen solicited and took bribes from Vietnamese immigrants. In one case, Nguyen took $1,000 from an immigrant seeking a “Green Card” and 200 egg rolls from an immigrant seeking citizenship.
Nguyen, who worked at USCIS’s Santa Ana office for approximately eight years and is now on leave, was an immigration service officer with the power to approve or deny applications for immigration benefits that are submitted by immigrants.
The case against Nguyen is the product of an investigation by the Federal Bureau of Investigation and the Department of Homeland Security’s Office of Inspector General.
Release No. 14-134
Honduran Man, Jose Hernandez-hernandez, Charged with Illegal ReentryRead the Press Release
U.S. Attorney Kenneth A. Polite announced that JOSE HERNANDEZ-HERNANDEZ, age 35, a citizen of Honduras, was charged today in a one-count indictment with illegal reentry of a removed alien, in violation of 8 U.S.C. ' 1326(a).
According to the indictment, HERNANDEZ-HERNANDEZ reentered the United States after having been previously removed on July 26, 2013.
If convicted, HERNANDEZ-HERNANDEZ faces a maximum term of imprisonment of two years, a maximum fine of $250,000, a maximum term of supervised release of one year, and a mandatory $100 special assessment.
U. S. Attorney Polite reiterated that an Indictment is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
U.S. Attorney Polite praised the work of the United States Department of Homeland Security, Immigration and Customs Enforcement and Removal Operations in investigating this matter. Assistant U. S. Attorney Spiro G. Latsis is in charge of the prosecution.
(Download Indictment )
Honduran Man, Alfredo Varela-hernandez, Charged with Illegal ReentryRead the Press Release
U.S. Attorney Kenneth A. Polite announced that ALFREDO VARELA-HERNANDEZ, age 35, a citizen of Honduras who recently resided in Kenner, Louisiana, was charged yesterday in a one-count bill of information with illegal reentry of a removed alien, in violation of 8 U.S.C. ' 1326(a).
According to the bill of information, VARELA-HERNANDEZ reentered the United States after having been previously removed on two occasions.
If convicted, VARELA-HERNANDEZ faces a maximum term of imprisonment of two years, a fine of up to $250,000, one year supervised release after imprisonment, and a $100 special assessment.
U. S. Attorney Polite reiterated that a bill of information is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
U.S. Attorney Polite praised the work of the United States Department of Homeland Security, Immigration and Custom Enforcement and Removal Operations in investigating this matter. Assistant United States Attorney Irene Gonzàlez is in charge of the prosecution.
(Download Bill of Information )
German Man Sentenced to 189 Months in Prison for Child Sex Tourism OffenseRead the Press Release
TUCSON, Ariz. – Today, Karsten Puschmann, 51, of Kiel, Germany, was sentenced by U.S. District Judge Jennifer G. Zipps to serve 189 months in prison. Puschmann pleaded guilty on Jan. 22, 2014, of traveling with intent to engage in illicit sexual conductPuschmann’s term of imprisonment will be followed by lifetime supervised release, with stringent sex offender conditions, including the condition that he register as a sex offender.
An investigation revealed that Puschmann, through the use of the internet, negotiated and planned a trip to Mexico in order to engage in commercial sex acts with six different children between the ages of five and eleven years old. He traveled from Europe to Tucson, Ariz., for this purpose and was arrested upon his arrival in Tucson.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Under this program, federal, state, and local law enforcement resources are combined to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The investigation in this case was conducted by Homeland Security Investigations, Nogales. The prosecution was handled by Carmen F. Corbin and Carin C. Duryee, District of Arizona, Tucson.
CASE NUMBER: CR-13-01312-TUC-JGZ
RELEASE NUMBER: 2014-057_ PuschmannFor 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.Former Sears Dealer Sentenced in Federal Court for FraudRead the Press Release
PROVIDENCE, R.I. – Joseph F. Kilty, 53, of Wakefield, R.I., a former authorized dealer of a Sears Hometown and Outlet, Inc. store in Middletown, R.I., was sentenced today in U.S. District Court in Providence to 3 years of probation, the first six months to be served in home confinement, for defrauding Sears of more than $154,000, announced United States Attorney Peter F. Neronha; Shelly A. Binkowski, Inspector in Charge of the U.S. Postal Inspection Service, Boston Division; and Vincent B. Lisi, Special Agent in Charge of the Boston Field Office of the FBI.
At sentencing, U.S. District Court Chief Judge William E. Smith also ordered Kilty to perform 300 hours of community service and to pay restitution to Sears in the amount of $139,989. Sears previously withheld a commission check due to Kilty in the amount of $14,131. Kilty pleaded guilty on June 5, 2014, to one count of mail fraud.
At the time of his guilty plea, Kilty admitted to the court that between January 2012 through June 2013, he failed to deposit $154,120 in cash receipts into a bank account he was required by Sears to establish and into which all store receipts were to have been deposited. Kilty admitted that he deposited the receipts into other personal bank accounts which he controlled.
Kilty admitted to the court that as part of the scheme, he created false documents to make it appear that the deposits had been made, including 47 fraudulent deposit slips and several fake bank reconciliation forms.
Additionally, Kilty admitted to the court that he created two counterfeit bank checks in the amounts of $99,000 and $28,319.75 made payable to Sears Hometown and Outlet, Inc., and that he provided the checks to a Sears district manager.
The matter was investigated by the U.S. Postal Inspection Service and the FBI.
The case was prosecuted by Assistant U.S. Attorney Lee H. Vilker.
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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]Former New York State Assemblywoman Sentenced in Manhattan Federal Court for Citizenship and Bankruptcy Fraud SchemesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today that former New York State Assemblywoman GABRIELA ROSA was sentenced in Manhattan federal court to a year and a day in prison, after having pled guilty to two federal felony charges arising out of her efforts to obtain United States citizenship through fraud and fraudulently concealing assets and income from a federal bankruptcy court. ROSA was sentenced today before United States District Judge Denise L. Cote. ROSA previously pled guilty pursuant to a plea agreement with the United States Attorney’s Office that required, among other things, that ROSA resign from the Assembly upon entry of her plea.
Manhattan U.S. Attorney Preet Bharara said: “Gabriela Rosa only became eligible to run for the New York State Assembly as a result of a years-long immigration fraud. She also defrauded a federal bankruptcy court and her creditors for her own financial gain. Now yet another state elected official will have to answer for her crimes with time in a federal prison.”
According to the Information, prior court filings, and statements made in Court:
The Marriage and Naturalization Fraud Scheme
The New York State Constitution states that only United States citizens may serve as members of the New York State Legislature. In November 2012, ROSA was elected to the New York State Legislature as an Assemblywoman for Assembly District 72 in Manhattan.
ROSA is a citizen of the Dominican Republic and had no citizenship status in the United States until 2005. In December 2005, ROSA was naturalized as a United States citizen as a result of a scheme to obtain legal residency and ultimately citizenship through a sham marriage. ROSA paid a United States citizen (“Spouse-1”) approximately $8,000 to enter into a sham marriage with her while she maintained a relationship with another individual who had been convicted of federal narcotics trafficking charges, and who later became her husband (“Spouse-2”). In numerous submissions and statements to immigration authorities made under penalty of perjury between 1996 and 2005, ROSA falsely represented to immigration authorities that she had entered into a bona fide marriage with Spouse-1, and that she had never given false or misleading information to a U.S. immigration official while applying for immigration benefits.
The Bankruptcy Fraud Scheme
In September 2009 ROSA filed a voluntary petition for bankruptcy, under Chapter 7 of the United States Bankruptcy Code, in the United States Bankruptcy Court for the Southern District of New York (the “Petition”). Through the Petition, ROSA sought to liquidate over $30,000 in debt that she had accumulated on, among other things, credit card charges and personal loans. In the Petition, which ROSA signed under penalty of perjury, and in subsequent documents submitted in support of the Petition, which were also signed under penalty of perjury, ROSA knowingly and willfully made several false declarations and statements. Among other things, ROSA fraudulently omitted her ownership of a cooperative apartment in Manhattan (the “Apartment”) from the Petition, which required her to list all real or personal property in which she had any ownership interest. ROSA, who worked at the time as a legislative assistant in the New York State Legislature, also failed to list outside income she earned as a political consultant, income earned by Spouse-2 in the Petition and supporting documents, and $25,000 in cash that she had deposited into her bank account months before filing the Petition.
In addition to the prison term of a year and a day, Judge Cote sentenced ROSA to three years’ supervised release, and ordered her to forfeit the proceeds of her bankruptcy fraud and repay creditors whom she defrauded.
Mr. Bharara praised the outstanding investigative work of the Criminal Investigators of the United States Attorney’s Office for the Southern District of New York.
The case is being handled by the Office’s Public Corruption Unit. Assistant U.S. Attorneys Howard S. Master and Jason Masimore are in charge of the investigation.
U.S. v. Gabriela Rosa Information
Former Lubbock Resident Sentenced to 10 Years in Federal Prison for Possessing Child PornographyRead the Press Release
LUBBOCK, Texas — Jeremy Daniel Labrec, 24, formerly of Lubbock, Texas, was sentenced this morning by U.S. District Judge Sam R. Cummings to 120 months in federal prison following his guilty plea in June 2014 to one count of possession of child pornography, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
Labrec has been in custody in Lubbock since his transfer from FCI Otisville, New York, where he had been serving a 330-month sentence imposed in relation to a federal child sexual exploitation conviction out of Indiana. Sixty months of the new sentence will be served consecutively to his Indiana sentence, and 60 months will be served concurrently with that sentence. Labrec was also ordered to pay $150,000 in restitution to a victim of his Lubbock offense.
According to documents filed in the case, in 2011, while living in Lubbock, Labrec saved an image of child pornography that he had earlier produced, on a hard drive located in his laptop computer, and he possessed the hard drive, knowing it contained child pornography. One image was a sexually explicit photo of a minor child.
The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
The FBI and the Lubbock Police Department investigated. Assistant U.S. Attorney Steven M. Sucsy prosecuted the case.
Former Jeweler Faces Federal Money Laundering Charges for Pawning Diamonds Falsely Reported Stolen in 2004Read the Press Release
BIRMINGHAM -- Federal prosecutors today charged a Vestavia Hills man with money laundering for pawning a 3-carat diamond in 2013 that was among a cache of jewels he collected $2.6 million in insurance money on in 2004 after reporting them stolen in a Mountain Brook Jewelry store robbery.
U.S. Attorney Joyce White Vance, FBI Special Agent in Charge Richard D. Schwein Jr., U.S. Secret Service Special Agent in Charge Craig Caldwell, Vestavia Hills Police Chief Dan Rary and Mountain Brook Police Chief Ted Cook announced the charges against JOSEPH HAROLD GANDY.
The U.S. Attorney's Office charged Gandy, 64, with one count of money laundering for pawning property worth more than $10,000 that he obtained through a criminal act, wire fraud, which he committed when he submitted an insurance claim on diamonds that had not been stolen. Prosecutors also charged Gandy with one count of being a convicted felon in possession of firearms for the 99 weapons seized at his Vestavia Hills home in November 2013. Gandy is prohibited from possessing weapons because of a 1989 federal mail fraud conviction.
The FBI recovered jewelry during the search of Gandy's home and, as part of a plea agreement with the government, he also turned over a portion of the approximate $1.5 million worth of diamonds and jewelry he falsely reported stolen in 2004. Among those jewels is a rare Blue Diamond worth at least $620,000.
"This defendant revealed decade-old criminal acts, and committed a new crime when he brought forth valuable, but fraudulently obtained diamonds to pawn," Vance said. "Thanks to the committed and cooperative efforts of the Mountain Brook and Vestavia Hills police departments, the FBI and the Secret Service, Mr. Gandy avoided, but did not escape justice."
"This case illustrates the great cooperation among law enforcement at all levels," Schwein said. "I want to extend my personal appreciation to the Vestavia Hills and Mountain Brook police departments, the U.S. Secret Service, and my agents for their outstanding work. It was their diligent investigative efforts that brought this case to where it is today," he said.
"I commend the cooperative between the FBI and our investigators," Rary said. "Interagency cooperation is essential in today's environment, especially in complex investigations such as these."
Prosecutors filed the charges and the plea agreement with Gandy in U.S. District Court.
According to the plea agreement, Gandy's crime unfolded as follows:
Gandy was an owner and the operator of Denman-Crosby Jewelry Store in Mountain Brook in 2004. In December of that year, he reported that two unidentified men robbed the store at gunpoint. At the time, Denman-Crosby was promoting a loose diamond sale for Christmas. It had many diamonds and other jewelry in on consignment from jewelers in New York and elsewhere. The store carried a $2.6 million insurance policy. Gandy had increased the coverage amount with XL Specialty Insurance Company a few weeks before the robbery.
In January and March of 2005, Gandy used interstate wire transmissions to submit insurance claims from the robbery. He included a detailed inventory of jewelry worth about $2.8 million that he reported stolen. XL Specialty paid the policy's limit of $2.6 million.
In July 2013, Gandy began sending a friend to jewelry stores in Jefferson County to pawn diamonds he had reported stolen in 2004. The first effort ended when the jeweler requested documentation on a 1.59-carat diamond, mounted in a platinum setting, and attempted to examine the stone closely. The concern was that the diamond might bear a laser inscription useful in tracing its history. Subsequently, Gandy examined 10 to 12 diamonds under a microscope and selected stones that bore no inscription.
On July 26, 2013, Gandy sent his friend to a Birmingham jewelry store to pawn a 3.01-carat emerald-cut diamond he said was worth about $43,000. Gandy said he wanted at least $15,000 for the stone. The store accepted the diamond in exchange for a $12,000 loan. The diamond was one Gandy reported stolen in the Denman-Crosby robbery. He gave his friend $2,000 for making the transaction.
Between August and November of 2013, Gandy's friend pawned two more diamonds: a 3.45-carat cushion-cut diamond for $8,000; and a 2.16-carat round diamond for $2,000. Both stones were on the stolen inventory list Gandy provided the insurance company in 2005. Gandy gave his friend $1,880 after receiving the $8,000 for the 3.45-carat diamond.
Gandy's plea agreement is a "binding plea agreement" in which the government and Gandy stipulate that a 45-month prison sentence is appropriate. If the court rejects the plea agreement, either party may declare it null and void.
As part of the agreement, the government would recommend Gandy be required to pay $20,000 in restitution to the jewelers where he pawned the diamonds, and that he forfeit to the U.S. government all the jewels seized and recovered in the case. Vestavia Hills Police seized the 99 weapons at Gandy's house and has state charges pending against him. The city police are handling forfeiture of the firearms.
The government acknowledges in the plea agreement that it has no evidence or information to suggest Gandy is violent or has been engaged in previous violent behavior. The agreement notes that Gandy, through his lawyer, related that, except for older firearms he bought before his 1989 conviction or that were passed down from his father and grandfather, the firearms at his house belonged to his son who died in 2004.
The FBI, Secret Service, Vestavia Hills and Mountain Brook police departments investigated the case. Assistant U.S. Attorney George A. Martin Jr. is prosecuting the case
Former Investment Adviser Sentenced to 3½ Years in Prison for $3 Million Loss to Victims in Financing Fraud SchemeRead the Press Release
CHICAGO ― A former investment adviser was sentenced to 3½ years in federal prison for fraudulently obtaining approximately $4 million from more than 30 victims and misusing the money to make Ponzi-type payments to investors, pay personal expenses, and personal gambling, resulting in a loss of just over $3 million. The defendant, OSCAR DONALD OVERBEY, JR., was a financial adviser at two north suburban locations for Ameriprise Financial, Inc., who engaged in a fraudulent financing scheme between approximately 1996 and 2007.
Overbey, 47, of Country Club Hills and formerly of Evanston, was ordered today to pay $3,090,833 in restitution by U.S. District Judge Gary S. Feinerman, who imposed the sentence yesterday in Federal Court. Overbey was ordered to begin serving his 42-month sentence on Jan. 12, 2015. Following his sentence, the judge ordered Overbey to be placed on supervised release for three years and prohibited him from gambling or visiting casinos or racetracks during that time. Overbey was indicted in 2012 and pleaded guilty to wire fraud last February.
According to court documents, among Overbey’s victims were two university workers and their two daughters. He convinced them to invest $150,000 in a purported short-term, government-backed investment paying 10 percent interest. The victims obtained funds from refinancing their home and from a home equity line of credit to make the investment. Instead of investing the funds, Overbey misappropriated the entire amount to pay personal expenses and to make more than 10 Ponzi-type payments to other victims.
“The victims placed their trust in [Overbey], but never had a chance. [Overbey] abused that trust and misused his education and skills as an investment advisor to benefit himself and to keep his scheme going,” Assistant U.S. Attorney Edward Kohler argued at sentencing.
The sentence was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois, and Antonio Gómez, Inspector-in-Charge of the U.S. Postal Inspection Service in Chicago. The Illinois Securities Department cooperated with the investigation.
Eleven Members of Ortega Drug Trafficking Organization Indicted for Conspiracy to Distribute MethamphetamineRead the Press Release
United States Attorney Andrew M. Luger today announced the indictment of 11 individuals charged with conspiring to distribute methamphetamine in Minnesota. The indictment is the result of a two-year investigation, and a collaborative effort among members of the Minnesota Bureau of Criminal Apprehension (BCA), the Drug Enforcement Administration (DEA), the Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF), the Internal Revenue Service, Criminal Investigation Division (IRS-CID), the Minnesota Department of Corrections, Office of Special Investigations (DOC-OSI), and several other local law enforcement partners.
According to the indictment, from approximately January 2012 through September 2014, the defendants conspired to possess and distribute methamphetamine. DANIEL SEGURA, JR., and SAGE OLLERMAN are charged with distributing approximately 26 pounds of methamphetamine in Minnesota on one occasion. MARK THOMAS BUSKOVICK, JEREMY JOSEPH HUNT, JAMIE LEE HUNT, JASON ORTEGA, JOSHUA ORTEGA, SALVADOR ORTEGA, and DANIEL SEGURA, JR., are charged with conspiring to distribute more than 500 grams of methamphetamine in Minnesota and elsewhere. Each of the other defendants is charged with conspiring to distribute additional quantities of methamphetamine.
This case is the result of a joint investigation, which is ongoing, including law enforcement efforts from the DEA, ATF, IRS-CID, Minnesota BCA, Minnesota DOC-OSI, the South Central Drug Investigation Unit (SCDIU), the Minnesota River Valley Drug Task Force (MRVDTF), the Southeast Minnesota Narcotics and Gang Task Force (SMNGTF), and the Rochester Police Department Narcotics Unit, with additional assistance from the Steele County Attorney’s Office, the Olmsted County Attorney’s Office, the Prairie Island Police Department, the Red Wing Police Department, the Owatonna Police Department, the Olmsted County Sheriff’s Office, the Rochester Police Department Street Crimes Unit, and the Goodhue County Sheriff’s Office.
This case is being prosecuted by Assistant U.S. Attorney Allen Slaughter.
Defendant Information: MARK THOMAS BUSKOVICK, 39
Owatonna, Minn.
Charges: • Conspiracy to Distribute Methamphetamine, 1 count
• Distribution of Methamphetamine, 2 counts
RIGOBERTO BASURTO, 21
Fresno, Calif.
Charges: • Conspiracy to Distribute Methamphetamine, 1 count
• Distribution of Methamphetamine, 1 count
• Possession with Intent to Distribute Methamphetamine, 1 count
JAMIE LEE HUNT, 27
Owatonna, Minn.
Charges: • Conspiracy to Distribute Methamphetamine, 1 count
• Distribution of Methamphetamine, 2 counts
JEREMY JOSEPH HUNT, 28
Owatonna, Minn.
Charges: • Conspiracy to Distribute Methamphetamine, 1 count
• Distribution of Methamphetamine, 3 counts
ASHLEY MARIAKAS, 26
Owatonna, Minn.
Charges: • Conspiracy to Distribute Methamphetamine, 1 count
• Distribution of Methamphetamine, 2 counts
SAGE OLLERMAN, 24
Owatonna, Minn.
Charges: • Conspiracy to Distribute Methamphetamine, 1 count
• Distribution of Methamphetamine, 1 count
JASON ORTEGA, 33
Owatonna, Minn.
Charges: • Conspiracy to Distribute Methamphetamine, 1 count
• Distribution of Methamphetamine, 1 count
JOSHUA ORTEGA, 33
Owatonna, Minn.
Charges: • Conspiracy to Distribute Methamphetamine, 1 count
• Distribution of Methamphetamine, 5 counts
SALVADOR ORTEGA, 32
Owatonna, Minn.
Charges: • Conspiracy to Distribute Methamphetamine, 1 count
• Possession of Methamphetamine and Cocaine, 1 count
DALTON QUIMBY, 21
Rochester, Minn.
Charges: • Conspiracy to Distribute Methamphetamine, 1 count
• Distribution of Methamphetamine, 2 counts
DANIEL SEGURA, JR., 30
Owatonna, Minn.
Charges: • Conspiracy to Distribute Methamphetamine, 1 count
• Distribution of Methamphetamine, 1 count###
The charges contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Eldorado Couple Sentenced for Bankruptcy FraudRead the Press Release
Follow @SDILNewsYesterday, a couple from Eldorado, Illinois, was sentenced on their convictions for bankruptcy fraud, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced. Lucy J. McGill, 62, and Gary G. McGill, 69, were each sentenced to 2 years of probation, with 4 months of home confinement on electronic monitoring, 20 hours of public service, and ordered to pay fines of $1,000 each. The sentencing hearings were conducted by U.S. District Judge J. Phil Gilbert.
The sentencings follow the McGills’ guilty pleas in federal court in Benton, Illinois on June 5, 2014. Lucy McGill pled guilty to two counts of making false statements under penalty of perjury in a bankruptcy case, three counts of making false statements under oath in a bankruptcy case, and one count of falsifying records in a bankruptcy case. Gary McGill pleaded guilty to two counts of making false statements under penalty of perjury in a bankruptcy case and two counts of making false statements under oath in a bankruptcy case.
The McGills filed a chapter 7 bankruptcy case on February 25, 2009, in the United States Bankruptcy Court in Benton, Illinois.
Federal law requires that debtors who file for bankruptcy must disclose all of their assets. In addition, debtors are required to disclose certain financial transactions that they conducted prior to filing bankruptcy. The purpose of these disclosures is to ensure that all available funds can collected to pay the creditors as much as possible on the amounts they are owed.
In their guilty pleas, Lucy and Gary McGill both admitted that they lied on a Statement of Financial Affairs that they filed with the Bankruptcy Court. The McGills falsely stated that $22,000 in two accounts in Lucy McGill’s name at SIU Credit Union belonged to Lucy McGill’s sister. In fact, that $22,000 had recently been paid to Gary McGill in settlement of two lawsuits. The McGills further admitted that they again lied on their Statement of Financial Affairs when they concealed the fact that they had recently given their son cash gifts totaling $6,800. The McGills continued to lie about these topics when they gave sworn testimony at a bankruptcy proceeding on April 3, 2009. Finally, Lucy McGill also admitted that she created fake receipts, purportedly showing that the cash in the SIU Credit Union accounts belonged to her sister, and then provided those receipts to the attorney administering her bankruptcy case.
In commenting on yesterday’s sentences, United States Attorney Wigginton said, “The United States Attorney’s Office for Southern Illinois remains committed to prosecuting individuals who commit bankruptcy fraud. This type of crime cheats creditors and represents a fraud on our federal courts. Bankruptcy should be a haven for those in need of its protections, not a place where people try to hide their assets from creditors.”
Nancy J. Gargula, United States Trustee for Southern Illinois, Central Illinois and Indiana (Region 10) stated, “Today’s proceedings make clear that this type of behavior will not be tolerated.” The U.S. Trustee Program is the component of the Justice Department that protects the integrity of the bankruptcy system by overseeing case administration and litigating to enforce the bankruptcy laws. Region 10 is headquartered in Indianapolis, with additional offices in South Bend, Ind., and Peoria, Ill. The charges resulted from a referral by the U.S. Trustee for Indiana and Central and Southern Illinois (Region 10) to the Southern District of Illinois Bankruptcy Fraud Working Group and U.S. Attorney.
The investigation was conducted by the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorneys Scott A. Verseman.
EDD Employee Sentenced to 2.5 Years in Prison for Disability FraudRead the Press Release
SACRAMENTO, Calif. — An employee of the Employment Development Department and a co-defendant for a scheme to defraud the EDD Disability Insurance Program, United States Attorney Benjamin B. Wagner announced.
EDD employee Simeon Shawnise Gregory, 35, of Moreno Valley, was sentenced to two years and six months in prison, and Terrance Rychan Smalls, 32, of Moreno Valley, was sentenced to six months in prison and six months home confinement. Earlier this year, co-defendants Sarah Elizabeth Trout, 35, of Riverside, was sentenced to five months in prison and five months of home detention, and Theresa Helena Campbell, 37, of Riverside, was sentenced to 18 months in prison.
According to court documents, Gregory used her position as an EDD Disability Insurance Program Representative to improperly process and manipulate the claims of Trout, Campbell, Smalls, and others. In return for fraudulently extending her disability claim, Trout paid Gregory up to half of her disability benefits. For Campbell and Smalls, Gregory caused EDD to issue specific payments, inactivated warning flags, and forged doctor’s certificates regarding the claimed disability. For Campbell, Gregory found an innocent individual with Campbell’s same name and used that individual’s legitimate wages to get Campbell fraudulent benefits. Gregory’s actions disabled the checks and balances that allow EDD to discover fraudulent claims. As a result of this scheme, the defendants defrauded the State of California of more than $360,000.
“Today’s sentencing highlights EDD’s continuing efforts to actively pursue and prosecute fraud against the California Disability Insurance program. The defendant in this case violated our public trust by participating in a complex scheme to defraud a vital program that serves as a lifeline for millions of disabled workers. It’s intolerable,” said Patrick W. Henning Jr., director of the California Employment Development Department (EDD). “Our Investigation Division is committed to working with our law enforcement partners to safeguard this and other EDD programs. Though this is a rare transgression not at all reflective of our dedicated staff, we take aggressive action whenever and wherever fraud is found.”
This case was the product of an investigation by the Employment Development Department, Investigation Division. Assistant United States Attorney Jared C. Dolan prosecuted the case.Department of Justice Will Not Challenge Proposed Cyber Intelligence Data-Sharing PlatformRead the Press Release
The Department of Justice announced today that it will not challenge a proposal by CyberPoint International LLC to offer a cyber intelligence data-sharing platform known as TruSTAR. The TruSTAR platform allows members to share threat and incident data along with attack information and develop remediation solutions to help define more effective strategies across industries to prevent successful cyber attacks.
The department’s position was stated in a business review letter to counsel for CyberPoint, from Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division.
CyberPoint’s proposed information sharing system is designed to address shortfalls in conventional, legacy information sharing services, while operating within the framework set forth in the Department of Justice and Federal Trade Commission’s Antitrust Policy Statement on Sharing of Cybersecurity Information.[1] Assistant Attorney General Baer cited to the department’s April policy statement with the Federal Trade Commission to underscore that “the federal antitrust agencies recognize the important role that information sharing plays in securing the nation’s IT infrastructure.” He further said that “[t]he antitrust laws are not an impediment to legitimate private-sector initiatives to share specific information about cyber incidents and mitigation techniques in order to defend against cyber attacks.” In approving the proposed TruSTAR platform, he concluded that the operation of the TruSTAR platform, as proposed, would be unlikely to facilitate price or other competitive coordination.
CyberPoint is a privately held company that provides security products, services and solutions to commercial and government customers. The TruSTAR platform is designed to collect incident reports that include specific and highly technical cyber-threat information, including current attack actors, targets of attack, contextual information regarding threats, and remediation solutions. An important component of the TruSTAR platform is that members are able to submit incident reports with complete anonymity. The TruSTAR platform also provides a community forum for members to anonymously collaborate with their peers on cyber threats and techniques for responding to them. Before they are permitted to use the system, all members who participate in any aspect of information sharing on the TruSTAR platform must agree not to share competitively sensitive information.
Under the department’s business review procedure, an organization may submit a proposed action to the Antitrust Division and receive a statement as to whether the division currently intends to challenge the action under the antitrust laws based on the information provided. The department reserves the right to challenge the proposed action under the antitrust laws if it produces anticompetitive effects.
A file containing the business review request and the department’s response may be examined in the Antitrust Documents Group of the Antitrust Division, U.S. Department of Justice, 450 Fifth Street, N.W., Suite 1010, Washington, D.C. 20530. After a 30-day waiting period, the documents supporting the business review will be added to the file, unless a basis for their exclusion for reasons of confidentiality has been established under the business review procedure.
[1] See Department of Justice and Federal Trade Commission: Antitrust Policy Statement on Sharing of Cyber Security Information (April 10, 2014) (“DOJ and FTC Antitrust Policy Statement”).
Department of Justice Charges Six Defendants in Connection with Violent Sex Trafficking SchemeRead the Press Release
The Department of Justice announced today a second superseding indictment in a sex trafficking conspiracy charging six individuals for offenses related to their involvement in sex trafficking adult victims in New Orleans and elsewhere. Five defendants, Granville Robinson, aka “Bear” and “HB,” 25; Duane Phillips, aka “P-nut,” 28; Anthony Ellis, aka “Anthony Deshun Lloyd,” “Animal,” and “AD,” 25; Christopher Williams, aka “Gutter,” 29; and LaQuentin Brown, aka “Nino,” 32, all of Memphis, Tennessee, were charged with conspiring to commit sex trafficking by force, fraud, and coercion. A sixth defendant, Kanubhai Patel, aka “Mr. Kenny” and “Pop,” 73, of Kenner, Louisiana, was indicted for benefitting financially from participating in a sex trafficking venture.
According to the indictment, from January 2013, until Jan. 15, 2014, Robinson, Phillips, Ellis, Williams and Brown conspired to recruit, entice, harbor, transport, provide, obtain and maintain multiple adult women for prostitution, using force, threats of force, fraud and coercion to cause them to engage in commercial sex acts in New Orleans and elsewhere. In addition to being charged with sex trafficking conspiracy, defendants Robinson, Phillips and Williams are each charged with additional counts of sex trafficking by force, fraud and coercion and with transporting women in interstate commerce for the purpose of prostitution.
If convicted of sex trafficking conspiracy, defendants Robinson, Phillips, Ellis, Williams and Brown each face a statutory maximum sentence of life imprisonment, a $250,000 fine and a lifetime of supervised release. If convicted of transportation for prostitution, Robinson, Phillips and Williams each face a statutory maximum of ten years in prison, a $250,000 fine and 3 years supervised release.
If convicted of benefitting financially from participation in a sex trafficking venture, Patel faces a statutory maximum sentence of life imprisonment, a $250,000 fine and a lifetime of supervised release.
A seventh defendant who was previously charged in connection with the case, Zacchaeus Taylor, aka “Little Z,” “Little Zay,” and “Little 5,” 21, also of Memphis Tennessee, pleaded guilty on June 25, 2014, to sex trafficking, conspiring and transporting women across state lines for prostitution. He is currently awaiting sentencing.
An indictment is merely a charge and defendants are presumed innocent until proven guilty beyond a reasonable doubt.
This case was investigated jointly by agents from the New Orleans Field Offices of the FBI and ICE Homeland Security Investigations as well as the FBI’s Memphis Field Office. This case is being prosecuted by Special Litigation Counsel John Cotton Richmond and Trial Attorney Christine M. Siscaretti of the Civil Right Division’s Human Trafficking Prosecution Unit, and Assistant United States Attorney Julia K. Evans of the Eastern District of Louisiana.
Department of Justice Charges Six Defendants in Connection with Violent Sex Trafficking SchemeRead the Press Release
The Department of Justice announced today a second superseding indictment in a sex trafficking conspiracy charging six individuals for offenses related to their involvement in sex trafficking adult victims in New Orleans and elsewhere. Five defendants, Granville Robinson, aka “Bear” and “HB,” 25; Duane Phillips, aka “P-nut,” 28; Anthony Ellis, aka “Anthony Deshun Lloyd,” “Animal,” and “AD,” 25; Christopher Williams, aka “Gutter,” 29; and LaQuentin Brown, aka “Nino,” 32, all of Memphis, Tennessee, were charged with conspiring to commit sex trafficking by force, fraud, and coercion. A sixth defendant, Kanubhai Patel, aka “Mr. Kenny” and “Pop,” 73, of Kenner, Louisiana, was indicted for benefitting financially from participating in a sex trafficking venture.
According to the indictment, from January 2013, until Jan. 15, 2014, Robinson, Phillips, Ellis, Williams and Brown conspired to recruit, entice, harbor, transport, provide, obtain and maintain multiple adult women for prostitution, using force, threats of force, fraud and coercion to cause them to engage in commercial sex acts in New Orleans and elsewhere. In addition to being charged with sex trafficking conspiracy, defendants Robinson, Phillips and Williams are each charged with additional counts of sex trafficking by force, fraud and coercion and with transporting women in interstate commerce for the purpose of prostitution.
If convicted of sex trafficking conspiracy, defendants Robinson, Phillips, Ellis, Williams and Brown each face a statutory maximum sentence of life imprisonment, a $250,000 fine and a lifetime of supervised release. If convicted of transportation for prostitution, Robinson, Phillips and Williams each face a statutory maximum of ten years in prison, a $250,000 fine and 3 years supervised release.
If convicted of benefitting financially from participation in a sex trafficking venture, Patel faces a statutory maximum sentence of life imprisonment, a $250,000 fine and a lifetime of supervised release.
A seventh defendant who was previously charged in connection with the case, Zacchaeus Taylor, aka “Little Z,” “Little Zay,” and “Little 5,” 21, also of Memphis Tennessee, pleaded guilty on June 25, 2014, to sex trafficking, conspiring and transporting women across state lines for prostitution. He is currently awaiting sentencing.
An indictment is merely a charge and defendants are presumed innocent until proven guilty beyond a reasonable doubt.
This case was investigated jointly by agents from the New Orleans Field Offices of the FBI and ICE Homeland Security Investigations as well as the FBI’s Memphis Field Office. This case is being prosecuted by Special Litigation Counsel John Cotton Richmond and Trial Attorney Christine M. Siscaretti of the Civil Right Division’s Human Trafficking Prosecution Unit, and Assistant United States Attorney Julia K. Evans of the Eastern District of Louisiana.
Dallas Tax Return Preparer Sentenced for Preparing Fraudulent Tax ReturnsRead the Press Release
DALLAS — A Dallas-area tax return preparer who was indicted in 2007 on federal felony charges stemming from the operation of that business and who remained a fugitive until November 2013, was sentenced yesterday. U.S. District Judge Jane J. Boyle sentenced Ousmane Sow, who pleaded guilty in April 2014 to one count of aiding and assisting in the preparation of a fraudulent tax return, to 30 months in federal prison. U.S. Attorney Sarah R. Saldaña of the Northern District of Texas made the announcement today.
According to the factual resume filed in the case, from 2003 to 2005, Sow and co-defendant Tichafara Mpariwa provided tax preparation services through a business they jointly owned and operated under the name of DSL Tax Services, LLC, located on Forest Lane in Dallas. In 2004, Sow opened a second location of DSL on Airport Freeway in Irving, Texas. Both Sow and Mpariwa were the electronic return originators at the Dallas and Irving office locations of DSL.
From 2003 to 2005, according to the factual resume, Sow knowingly prepared, and caused to be filed, U.S. individual tax returns, along with supporting schedules and forms, which contained materially false credits and deductions to fraudulently increase the taxpayer clients’ refunds. This included the use of false business expenses and the use of false education expenses to create a false education credit, thus increasing the taxpayer client’s refund.
Sow voluntarily returned to the U.S to face charges after contacting Internal Revenue Service Criminal Investigation (IRS-CI) from Burundi about returning. Defendant Mpariwa remains a fugitive.
IRS-CI led the investigation and the U.S. Department of State’s Bureau of Diplomatic Security assisted in securing Sow’s return to the U.S.
Assistant U.S. Attorney Chris Stokes prosecuted.
Dallas Area Man Sentenced to Federal Prison for Murder Plot in Connection with 2013 Fort Sam Houston Shooting IncidentRead the Press Release
In San Antonio today, 29-year-old Leonard Roundtree, III, of Richardson, TX, was sentenced to five years in federal prison followed by three years of supervised release for plotting to kill his uncle’s intimate partner announced United States Attorney Robert Pitman, FBI Special Agent in Charge Christopher H. Combs, San Antonio Division, and United States Marshal Robert Almonte.
In April, a jury convicted Leonard Roundtree of one count of conspiracy to commit murder. Evidence presented in open court revealed that on June 10, 2013, Roundtree’s uncle, 52-year-old Alvin Roundtree, shot and wounded his intimate partner with a .45 caliber handgun inside the Medical Training Facility located on Fort Sam Houston Army Post. The victim, who suffered a total of seven gunshot wounds, was immediately taken into surgery and survived the incident. Authorities subsequently apprehended Alvin Roundtree while still on Fort Sam Houston and recovered the firearm. Recorded phone calls between the defendants revealed that the two conspired to hire someone to kill the victim to prevent her testimony in court. The evidence revealed that Leonard Roundtree agreed to, and in fact did, deliver information between his uncle and the hitman ultimately agreeing to pay $10,000 upon proof the murder.
In March, Alvin Roundtree pleaded guilty to one count of assaulting an officer or employee of the United States with a deadly weapon. On September 9, 2014, Chief United States District Judge Fred Biery sentenced Alvin Roundtree to the maximum 20 years in federal prison.
Assistant United States Attorneys Bettina Richardson and Joey Contreras prosecuted this case on behalf of the Government.
Cranston Man Sentenced for Threatening to Assault, Kill IRS Agent and FamilyRead the Press Release
PROVIDENCE, R.I. – U.S. District Court Chief Judge William E. Smith today sentenced Andrew A. Calcione, 49, of Cranston, to 12 months and one day in federal prison for threatening to assault and murder an IRS agent and his family, announced United States Attorney Peter F. Neronha; J. Russell George, Treasury Inspector General for Tax Administration; and Robert E. O’Malley, Special Agent in Charge, Treasury Inspector General for Tax Administration, New York Field Division.
Calcione was convicted by Chief Judge William E. Smith on May 26, 2014, based on evidence presented during a jury waived trial on May 21, 2014. Calcione was convicted of one count each of threatening to assault and murder an IRS revenue agent and threatening to assault and murder a member of the immediate family of an IRS revenue agent.
According to the government’s evidence, an IRS revenue agent in Rhode Island was assigned to examine Calcione’s personal federal tax returns for years 2008, 2009 and 2010. As a result of the examination, the agent estimated that a $330,000 tax liability would be assessed against Calcione.
In April 2013, the IRS revenue agent requested that Calcione and an ex-wife of Calcione sign a Consent to Extend Time to Assess Tax form. Calcione signed the form but his ex-wife had not. On July 12, 2013, the revenue agent left a voicemail message for Andrew Calcione inquiring as to the status of the executed form.
According to the government’s evidence, on July 15, 2013, the IRS revenue agent received two voicemail messages from Calcione. One of the messages contained a threat that if the agent called him again he would show up at the agent’s home and torture the agent, then rape and kill his wife and injure his daughter while the agent watched, before killing the agent. A second message left by Calcione requested that Calcione disregard the first message, which Calcione said was left in error.
At sentencing, Chief Judge William E. Smith also ordered Calcione to serve 3 years supervised release upon completion of his prison term.
The case was prosecuted by Assistant U.S. Attorney Gerard B. Sullivan.###
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]Convicted Felon Admits to Possessing 12 Firearms, Possessing and Trafficking DrugsRead the Press Release
PROVIDENCE, R.I. – Philip DeBartolo, 29, of Scituate, pled guilty in federal court in Providence today to being a felon in possession of 12 firearms and to drug trafficking charges, announced United States Attorney Peter F. Neronha; Daniel J. Kumor, Special Agent in Charge of the Boston field divisionof ATF; Scituate Police Chief Colonel David M. Randall; and Michael Ferguson, Acting Special Agent in Charge of the DEA’s New England field division.
DeBartolo faces statutory penalties of up to 80 years in federal prison, lifetime supervised release and a fine of up to $2,750,000 when he is sentenced by U.S. District Court Chief Judge William E. Smith on December 19, 2014.
DeBartolo pleaded guilty as charged in an 11-count indictment to three counts of being a felon in possession of a firearm, one count of being a felon in possession of nine firearms, one count of possession of a firearm with an obliterated serial number, one count of manufacture of marijuana, once count of manufacture of marijuana near a school and four counts or marijuana distribution.
No plea agreement was filed in this matter.
According to court documents, on several occasions beginning in August 2013, an undercover ATF agent spoke with and met with DeBartolo to arrange and to purchase three firearms, including a sawed-off shotgun, for between $300 and $400 dollars. In addition, on several occasions, DeBartolo sold to the agent plastic bags containing approximately one ounce of marijuana, each for between $200 & $225 dollars.
According to information presented to the court, ATF agents, with the assistance of Scituate Police and DEA agents, executed a court authorized search of DeBartolo's residence on January 15, 2014, and seized six semi-automatic pistols – five with high capacity magazines, three revolvers and a significant amount of ammunition found hidden beneath the floor boards of a second floor storage room. Agents and officers also seized 31 marijuana plants from the basement.
According to court records, DeBartolo was convicted in Rhode Island state court in 2005 on felony assault, drive-by shooting and firearm charges.
The case is being prosecuted by Assistant U.S. Attorney Milind M. Shah.
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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]Colombian Traffickers Plead Guilty to International Maritime Drug Trafficking ConspiracyRead the Press Release
Three Colombian citizens pleaded guilty today for conspiring to transport more than 1,000 kilograms of cocaine on board “go-fast boats” from the north coast of Colombia into international waters on vessels subject to the jurisdiction of the United States.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and Administrator Michele M. Leonhart of the U.S. Drug Enforcement Administration (DEA) made the announcement.
Angel Javier Varon Castro, 43; Luis Delio Herrera Astudillo, 45; and Eusebio David Webster Archbold, 33, all Colombian nationals, pleaded guilty before U.S. District Judge Beryl A. Howell of the District of Columbia to one count of conspiracy to distribute cocaine and possess with intent to distribute cocaine on board a vessel subject to the jurisdiction of the United States. Sentencing is set for Jan. 9, 2015.
“Today’s guilty pleas highlight our successful and vigorous partnership with Colombian law enforcement as we work to halt the flow of drugs heading north from the coast of Colombia,” said Assistant Attorney General Caldwell. “These defendants and their drug trafficking partners used seagoing vessels to inject vast quantities of cocaine into international commerce. But while drug traffickers may believe they can operate on the high seas with impunity, today’s convictions prove otherwise. Working with our international partners, we will bring to justice those who would flood our ports and, ultimately, our communities with dangerous narcotics.”
“The arrests and guilty pleas of these three international drug smugglers are the direct result of the resolute partnership between the DEA and our Colombian law enforcement partners,” said DEA Administrator Leonhart. “This is another example of the fine work that DEA, prosecutors, and our partners around the globe accomplish every day.”
According to their plea agreements, the defendants worked for a drug-trafficking organization responsible for transporting cocaine aboard go-fast vessels leaving from the area of Cartagena, Colombia, to Central America, and traveling in international waters on vessels subject to the jurisdiction of the United States. During the investigation, pursuant to Colombian judicial authority, law enforcement recorded the defendants’ telephone conversations in which they planned the operation, including the use of two 40-foot go-fast vessels. These boats were later intercepted in February and April 2010 in international waters by the United States Coast Guard. Go-fast vessels are specially equipped speed boats designed to transport large quantities of narcotics.
This Organized Crime Drug Enforcement Task Force (OCDETF) case, called Operation Pacific Empire, is being investigated by DEA’s Cartagena Country Office, assisted by DEA’s offices in Miami and Puerto Rico. The Cartagena office worked in partnership with the Judicial Police of the Prosecutor General’s Office in Colombia (CTI) and the Colombian National Police.
The case is being prosecuted by Trial Attorneys Meredith Mills, Brad Price and Paul Laymon of the Criminal Division’s Narcotic and Dangerous Drug Section, with significant assistance from the Judicial Attachés in Bogotá, Colombia, the Criminal Division’s Office of International Affairs, and the Prosecutor General’s Office of the Republic of Colombia.
Centerville Woman Sentenced in Multi-Million Dollar Mortgage Fraud SchemeRead the Press Release
ALEXANDRIA, Va. – Lorene Chittenden, 57, of Centreville, Va., was sentenced today to 42 monthsin prison, followed by three years of supervised release, for conspiracy to commit bank fraud and related charges arising from a multi-million dollar mortgage fraud scheme.
The amounts in restitution and forfeiture that Chittenden will pay will be determined at a later hearing. More than $1 million dollars in bank accounts belonging to Chittenden were seized by law enforcement agents when the charges were first filed.Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Andrew McCabe, Assistant Director in Charge of the FBI’s Washington Field Office; and Fred W. Gibson, Principal Deputy Inspector General for the Federal Deposit Insurance Corporation (FDIC) Office of Inspector General made the announcement after sentencing by U.S. District Judge Liam O’Grady.
Chittendenwas found guilty after a six-day jury trial on May 7, 2014. According to court documents, Chittenden and her co-conspirators were responsible for over $15 million in losses to various lending institutions that purchased fraudulent loans that Chittenden originated as a loan officer at George Mason Mortgage, a subsidiary of federally-insured Cardinal Bank. The defendant and her co-conspirators from Manassas, Va., real estate firm Vilchez & Associates, fraudulently inflated the income and assets of their clients to obtain mortgage loans in amounts that the clients were wholly unqualified for. Chittenden earned hundreds of thousands of dollars in loan commissions from the fraud, while ringleader Rosita Vilchez pocketed millions of dollars in real estate commissions. The Vilchez conspiracy targeted hundreds of non-English-speaking members of the northern Virginia Hispanic community who were not able to read the loan applications and closing documents they were asked to sign. Often the amount of the monthly mortgage payments was unknown or even misrepresented to the borrowers. Vilchez was recently arrested in Peru where she had been a fugitive. Her brother, Armando Pino, who was also a realtor at Vilchez & Associates, was arrested in Peru in December 2012. Both Vilchez and Pino are fighting extradition to the United States to face charges.
This case was investigated by the FBI’s Washington Field Office and the FDIC Office of Inspector General. Assistant U.S. Attorneys James P. Gillis and Julia K. Martinez prosecuted the case on behalf of the United States.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. 1:12-cr-00394.
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Caribbean-Based Investment Advisor and Attorney Sentenced for Using Offshore Accounts to Launder and Conceal FundsRead the Press Release
Eric St-Cyr, an investment advisor, and Patrick Poulin, an attorney, were sentenced today to serve 14 months in prison and three years of supervised release each for conspiring to launder monetary instruments, the Justice Department and Internal Revenue Service (IRS) announced.
Senior U.S. District Judge T.S. Ellis III imposed the sentences after considering the defendants’ substantial cooperation with ongoing government investigations. St-Cyr and Poulin, both Canadian citizens, along with Joshua Vandyk, a U.S. citizen, were indicted by a grand jury in the U.S. District Court for the Eastern District of Virginia on March 6, and the indictment was unsealed March 12 after the defendants were arrested in Miami. St-Cyr, 50, pleaded guilty on June 27 and Poulin, 41, pleaded guilty on July 11. Vandyk, 34, pleaded guilty on June 12 and was sentenced on Sept. 5 to serve 30 months in prison.
According to the plea agreements and statements of facts, Vandyk, St-Cyr and Poulin conspired to conceal and disguise the nature, location, source, ownership and control of property believed to be the proceeds of bank fraud, specifically $2 million. Vandyk, St-Cyr and Poulin assisted undercover law enforcement agents posing as U.S. clients in laundering purported criminal proceeds through an offshore structure designed to conceal the true identity of the proceeds’ owners. Vandyk and St-Cyr invested the laundered funds on the clients’ behalf and represented that the funds would not be reported to the U.S. government.
“The sentences imposed by the court today show that those who use offshore accounts and entities for money laundering and tax evasion will be punished,” said Deputy Assistant Attorney General Ronald A. Cimino for the Justice Department’s Tax Division. “This investigation, which lasted years, involved extensive undercover activity as well as cooperation from multiple foreign law enforcement agencies. The undercover IRS agents in this investigation went to Canada, the Turks and Caicos and the Cayman Islands to develop the evidence. These two defendants are cooperating with the IRS, and we anticipate that other investigations will develop from the information they have provided.”
“These defendants played a shell game by creating offshore entities designed to help their U.S. clients evade taxes and other legal requirements, and they used that same shell game to launder purported criminal proceeds,” said U.S. Attorney Dana J. Boente for the Eastern District of Virginia. “We are committed to working with our law enforcement partners to penetrate and combat these schemes wherever they occur.”
“Today’s sentencings close the door on a business built on skirting the law,” said Chief of IRS-Criminal Investigation Richard Weber. “This investigation reinforces our commitment to investigate and prosecute criminals worldwide who conduct illegal financial transactions, launder money or attempt to conceal the true source of their income in order to evade paying taxes. This should send a clear message to those involved in this type of crime—we will find you.”
According to court documents, Vandyk and St-Cyr lived in the Cayman Islands and worked for an investment firm based there. St-Cyr was the founder and head of the investment firm, whose clientele included numerous U.S. citizens. Poulin, an attorney at a law firm based in Turks and Caicos, worked and resided in Canada as well as Turks and Caicos. His clientele also included numerous U.S. citizens. Vandyk, St-Cyr and Poulin solicited U.S. citizens to use their services to hide assets from the U.S. government, including the IRS. Vandyk and St-Cyr directed the undercover agents to create an offshore corporation with the assistance of Poulin and others because they and the investment firm did not want to appear to deal with U.S. clients. Vandyk, St-Cyr and Poulin used the offshore entity to move money into the Cayman Islands and used Poulin as a nominee intermediary for the transactions.
According to court documents, Poulin established an offshore corporation called Zero Exposure Inc. for the undercover agents and served as a nominal board member in lieu of the clients. Poulin transferred approximately $200,000 that the defendants believed to be the proceeds of bank fraud from the offshore corporation to the Cayman Islands, where Vandyk and St-Cyr invested those funds outside of the United States in the name of the offshore corporation. The investment firm represented that it would neither disclose the investments or any investment gains to the U.S. government, nor would it provide monthly statements or other investment statements to the clients. Clients were able to monitor their investments online through the use of anonymous, numeric passcodes. Upon request from the U.S. client, Vandyk and St-Cyr liquidated investments and transferred money, through Poulin, back to the United States. According to Vandyk and St-Cyr, the investment firm would charge clients higher fees to launder criminal proceeds than to assist them in tax evasion.
The case was investigated by special agents of the IRS-Criminal Investigation. Trial Attorney Todd Ellinwood and Assistant Chief Caryn Finley of the Tax Division and Assistant U.S. Attorney Kosta Stojilkovic for the Eastern District of Virginia are prosecuting the case. The Justice Department and the IRS would like to thank the Royal Canadian Mounted Police, the Royal Cayman Islands Police Service and the Royal Turks and Caicos Islands Police Force for their assistance in this investigation.
Additional information about the Tax Division and its enforcement efforts may be found at the division website.
Camden Man Admits Conspiracy to Distribute HeroinRead the Press Release
CAMDEN, N.J. – A Camden man today admitted his involvement in a heroin distribution ring, U.S. Attorney Paul J. Fishman announced.
Keenan Johnson, a/k/a “Super Star K,” a/k/a “K,” 30, pleaded guilty before U.S. District Court Judge Joseph E. Irenas to an information charging him with conspiring to distribute more than 100 grams of heroin.
According to documents filed in this case and statements made in court:
From December 2007 through June 2012, Johnson conspired with others to distribute and possess with the intent to distribute more than 100 grams of heroin.
The counts to which Johnson pleaded guilty carry a maximum potential penalty of 40 years in prison and a fine of $5 million. Under terms of the plea, Johnson must forfeit to the United States $ 52,380 seized from his residence, as well as four vehicles, jewelry, and a Glock 26 9mm semi-automatic handgun. Sentencing is scheduled for Jan. 16, 2015.
U.S. Attorney Fishman credited special agents of the FBI’s Resident Agency in Cherry Hill, N.J., under the direction of Special Agent in Charge Edward J. Hanko; and the Camden County Prosecutor’s Office, under the direction of Prosecutor Mary Eva Colalillo, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Jacqueline M. Carle of the U.S. Attorney’s Office Criminal Division in Camden.
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Defense attorney: Jose L. Ongay Esq., CamdenCahokia Woman Sentenced for Stealing Funds from Department of Veterans AffairsRead the Press Release
Follow @SDILNewsThe United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today that Mary Lee Owens, 54, of Cahokia, was sentenced today in the United States District Court for the Southern District of Illinois in East Saint Louis on charges that she stole pension benefits from the United States Department of Veterans Affairs. Owens admitted that from November 2004 through April 2013, she fraudulently obtained $70,260 from the Department of Veterans Affairs.
The district court sentenced Owens to three months imprisonment, three years of supervised release to follow imprisonment, with the first six months to be in home detention, to pay restitution of $70,260 to Department of Veterans Affairs, and to pay a special assessment of $100.
The case was investigated by agents of the Department of Veterans Affairs, Office of Inspector General. The case is being prosecuted by Assistant U.S. Attorney Liam Coonan.
Buffalo Woman Sentenced for Bank FraudRead the Press Release
BUFFALO, N.Y. - U.S. Attorney William J. Hochul, Jr. announced today that Adlyn Marie Echevarria Robles, 22, of Buffalo, N.Y., who was convicted of bank robbery, was sentenced to 24 months in prison and ordered to pay $13,168 in restitution by Chief U.S. District Judge William M. Skretny.
Assistant U.S. Attorney Mary Catherine Baumgarten, who handled the case, stated that on July 5, 2013, the defendant entered the M&T Bank at 1580 Hertel Avenue in Buffalo. Robles passed the teller a demand note threatening the use of a weapon. The teller gave the defendant a specific amount of money.
On July 24, 2013, the defendant entered the M&T Bank at 709 Elmwood Avenue in Buffalo and passed the teller a demand note threatening the use of a weapon. The teller gave Robles a specific amount of money.
Charges against co-defendant Ronald McClendon, Jr. are pending. The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
The sentencing is the culmination of an investigation by the Federal Bureau of Investigation’s Safe Streets Task Force.- Brother-in-Law to Former Tamaulipas Governor Indicted in Money Laundering Scheme
- Border Patrol Agent Indicted
Bloods Street Gang Leader Sentenced to 30 Years of Imprisonment for Racketeering, Murder, Drug Distribution and Firearms UseRead the Press Release
Today in Brooklyn federal court, Laron Spicer, also known as “Face,” a leader of the “Nine-Trey Gangsters” set of the Bloods street gang in Crown Heights, Brooklyn, was sentenced to a 30-year prison term for charges related to the set’s control of illegal activity on Sterling Place between Buffalo and Rochester Avenues for over 12 years. Throughout the period of Spicer’s leadership of the set, Sterling Place was beset by gang-related drive-by shootings, regular gunfire, slashings and drug dealing. As the set’s primary enforcer, Spicer was responsible for numerous acts of violence, including shootings and slashings, and held neighborhood residents in fear of violent retribution for questioning his authority or cooperating with law enforcement.
The sentencing was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, George Venizelos, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office, and William J. Bratton, Commissioner, New York City Police Department.
“For over a decade, Spicer used violence and brutality to terrorize the streets of Crown Heights. Let today’s lengthy sentence be a message to other gang members victimizing their own communities – we will not tolerate violence and gang-related crimes,” stated United States Attorney Lynch. Ms. Lynch thanked the FBI, the NYPD, and the Kings County District Attorney’s Office for their assistance in this case.
In 2010, an investigation by the Federal Bureau of Investigation and the New York City Police Department led to the indictment and arrest of Spicer and 11 of the gang’s members and associates on charges including racketeering, drug distribution, murder and attempted murder. Among other acts, Spicer was charged with four non-fatal shootings and the 2008 murder of rival drug dealer William Singletary, who had set up a competing drug operation in the gang’s territory. During the period charged in the indictment, Spicer was arrested 30 times by New York City police officers and was convicted of, among other offenses, illegal gun possession on five occasions and witness tampering for threatening to kill a police officer who was testifying against him at a state court proceeding. On December 19, 2013, Spicer pled guilty to federal charges of racketeering, narcotics distribution conspiracy, and ordering the murder of Singletary.
The government’s case was prosecuted by Assistant United States Attorneys Matthew Amatruda, Nadia Shihata and Erik Paulsen.
The Defendant:
LARON A. SPICER
Alias: “Face”
Age: 34
Belleville Man Sentenced to Prison for Money Laundering Andwire FraudRead the Press Release
Follow @SDILNewsStephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today that Brian J. Fields, 52, of Belleville, IL, was sentenced on a two-count information charging that he engaged in a scheme to commit wire fraud and that he had committed money laundering. Fields was sentenced to serve 27 months in federal prison, to pay $98,800 in restitution to his victims, and to serve 3 years of supervised release after his release from prison.
At his plea hearing On May 28, 2014, Fields admitted that he assisted a person from oversees (Nigeria) in defrauding United States Citizens by sending counterfeit checks and money orders to individuals in several schemes (such as a “Secret Shopper” scam). The schemes resulted in victims receiving the counterfeit check or money order, depositing it into their own bank account, and then at the direction of Fields, the victim would wire transfer legitimate funds to Fields. By the time the person learned the check or money order was worthless, they had already sent the money to Fields. When Fields received the victims’ money, he would keep a portion for himself and then to further the scheme, Fields would send the remaining funds to a person located in Nigeria. Agents were able to identify over 70 victims.
The investigation was conducted by the Criminal Investigation Division of the Internal Revenue Service, the United States Secret Service and the Swansea, Illinois Police Department.
The case is being prosecuted by Assistant United States Attorney Ranley R. Killian.
Arizona Man Pleads Guilty to Drug Trafficking ChargeRead the Press Release
ROCHESTER, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that Manuel Montes Espinoza, 37, of Tucson, Arizona, pleaded guilty before U.S. District Judge Frank P. Geraci to conspiracy to possess with intent to distribute, and to distribute, marijuana. The charges carry a mandatory minimum sentence of five years in prison, a maximum of 40 years, a fine of $5,000,000 or both.
Assistant U.S. Attorney Charles Moynihan, who is handling the case, stated Espinoza, who also went by the name “Nero,” was involved in a marijuana trafficking conspiracy which began operations in March of 2007 and continued through April of 2010. During that time frame, the members of the conspiracy shipped hundreds of pounds of marijuana from Tucson, Arizona, to Cleveland, Ohio, Port Chester, NY, Philadelphia, Pennsylvania, and Rochester, NY. The organization acquired marijuana from suppliers in Mexico. Espinoza, who is from Mexico and lived in the Tucson area during some of the time frame of the conspiracy, was responsible for acquiring marijuana from sources in Mexico and selling it to other members of the conspiracy who shipped it to the Northeast.
At the May 2014 trial of co-defendant, Raul Eduardo Rivera de la Torre, a government witness, who was involved in the conspiracy, testified that he would purchase marijuana from Espinoza, as well as others, and would be assisted by de la Torre, who would translate for Espinoza, who spoke Spanish, and the witness, who spoke English. The witness testified that he would utilize various shipping companies to transport marijuana packaged in boxes to various locations in Rochester. He then detailed that he later utilized over-land trucking companies to deliver crates full of marijuana to various locations in the Northeastern United States. Another government witness detailed how he was responsible for receiving the shipments of marijuana in Rochester and that he would distribute the marijuana once it arrived.
The conviction is the culmination of an investigation on the part of Special Agents of the Drug Enforcement Administration, under the direction of James J. Hunt, Acting Special Agent in Charge, New York Field Division.
Sentencing is scheduled for January 7, 2014, at 3:30 p.m. before Judge Geraci.Andres Villalva-guadarrama Pleads Guilty in Federal Court for Illegally Use of A Social Security NumberRead the Press Release
U.S. Attorney Kenneth A. Polite announced that ANDRES VILLALVA-GUADARRAMA, age 53, a citizen of Mexico who recently resided in Gretna, Louisiana, pled guilty yesterday to a one-count indictment for illegal use of a Social Security Number.
According to the indictment, on or about January 22, 2014, VILLALVA-GUADARRAMA, for the purpose of obtaining employment and for other purposes, knowingly and with intent to deceive, did falsely represent on an US Citizenship and Immigration Services Employment Eligibility Verification Form that a Social Security Number not issued to him, was assigned to him; all in violation of Title 42, United States Code, Section 408(a)(7)(B).
VILLALVA-GUADARRAMA faces a maximum term of imprisonment of five years, a maximum fine of $250,000, a maximum term of supervised release of three years, and a mandatory special assessment of $100.00. U.S. District Judge Eldon E. Fallon set sentencing on January 8, 2015.
U.S. Attorney Polite praised the work of the Department of Homeland Security/Immigration and Custom Enforcement and Removal in investigating this matter. Assistant United States Attorney Irene Gonzàlez is in charge of the prosecution.
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Albuquerque Man Arrested on Federal Child Exploitation ChargesRead the Press Release
ALBUQUERQUE – Bentley Streett, 38, of Albuquerque, N.M., was arrested this morning by the FBI and the Bernalillo County Sheriff’s Office (BCSO) on federal child exploitation charges. Streett made his initial appearance in federal court earlier today and remains in custody pending a detention hearing scheduled for Oct. 6, 2014.
Streett is charged in a criminal complaint with inducing and enticing minors to engage in sexual activity; the interstate transmission of obscene matter to minors; and attempting to produce child pornography. According to the criminal complaint, in Oct. 2013, the National Center for Missing and Exploited Children forwarded a tip that Streett allegedly had engaged in the online solicitation of a nude photograph from a 15-year-old child victim to the New Mexico Internet Crimes Against Children (ICAC) Task Force. A search warrant on a cellphone account allegedly subscribed to Streett revealed numerous text messages between Streett and the child victim, and the child victim allegedly confirmed that Streett requested that she send nude photographs of herself to him and that she declined his request.
The complaint alleges that in Feb. 2014, the BCSO seized Streett’s cellphone when they executed a search warrant at Streett’s residence. A forensic examination of Streett’s cellphone revealed that from Nov. 2013 to Jan. 2014, the cellphone allegedly had been used to send text messages to a 15-year-old child victim in El Paso, Texas. In Nov. 2013, Streett allegedly sent text messages requesting that this second child victim send nude photographs of herself to him. At the time, the second child victim was 14-years-old. In Nov. 2013 and Jan. 2014, Streett allegedly sent the second child victim photographs of nude male and female bodies, including photographs of individuals who appear to be under the age of 18. The FBI initiated a federal investigation on Sept. 18, 2014, after receiving a referral from the BCSO.
If convicted of the charges in the criminal complaint, Streett faces a federal prison term of not less than 15 years and not more than 30 years. Streett also would be required to register as a sex offender. Charges in criminal complaints are merely accusations and criminal defendants are presumed innocent unless found guilty beyond a reasonable doubt.
This case was investigated by the Albuquerque office of the FBI, the BCSO and the New Mexico ICAC Task Force. The case is being prosecuted by Assistant U.S. Attorney Shammara H. Henderson as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice (DOJ) to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and DOJ’s Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
The case also was brought as a part of the New Mexico ICAC Task Force’s mission, which is to locate, track, and capture Internet child sexual predators and Internet child pornographers in New Mexico. There are 74 federal, state and local law enforcement agencies associated with the New Mexico ICAC Task Force, which is funded by a grant administered by the New Mexico Attorney General’s Office. Anyone with information relating to suspected child predators and suspected child abuse is encouraged to contact federal or local law enforcement.
Accountant Pleads Guilty to Hiding Swiss Bank AccountRead the Press Release
ATLANTA - Forensic accountant and certified fraud examiner Howard Bloomberg has pleaded guilty to willfully failing to disclose to the U.S. Treasury Department a foreign bank account he controlled in Switzerland.
“The era of hiding money in secret Swiss bank accounts is over,” said United States Attorney Sally Quillian Yates. “Citizens should understand that failing to abide by their banking disclosure obligations to the U.S. Treasury Department could mean criminal prosecution.”
“The Internal Revenue Service and the U.S. Attorney’s office will continue to pursue those who attempt to fraudulently obstruct or impede our Nation's tax system.” stated Veronica F. Hyman-Pillot, Special Agent in Charge, IRS-Criminal Investigation.
According to United States Attorney Yates, the charges and other information presented in court: From 1997 to 2008, Bloomberg owned and controlled a foreign bank account with Union Bank of Switzerland AG (“UBS”), one of the biggest banks in Switzerland and largest wealth managers in the world. By 2001, Bloomberg’s foreign bank account with UBS had a high balance of approximately $930,000.
Citizens and residents of the United States who have a financial interest in, or signature authority over, a financial account in a foreign country with an aggregate value of more than $10,000 at any time during a calendar year are required to file with the U.S. Department of Treasury a “Report of Foreign Bank and Financial Accounts,” commonly referred to as the “FBAR”. The FBAR for the applicable year is due to be filed by June 30 of the following year. Bloomberg pleaded guilty to willfully failing to file a FBAR for the 2008 year, even though that same year he wired over $540,000 from his Swiss UBS bank account to a United States bank account that he controlled.
Sentencing for Bloomberg, 55, of Atlanta, Ga., is scheduled for December 19, 2014 at 10:30 a.m. before United States District Judge Thomas W. Thrash.
This case is being investigated by the Internal Revenue Service Criminal Investigation.
Assistant United States Attorney Steven D. Grimberg is prosecuting 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/.
2 October 2014
‘Real Housewives of New Jersey’ Stars Sentenced to Prison for Conspiracy, Bankruptcy Fraud and Tax OffensesRead the Press Release
Forty-one Months for Giuseppe Giudice, 15 Months for Teresa Giudice
NEWARK, N.J. – Two of the stars of the television show “The Real Housewives of New Jersey” were sentenced today to prison terms for committing a string of crimes as part of a long-running financial fraud conspiracy, U.S. Attorney Paul J. Fishman announced.
Teresa Giudice, 42, and her husband, Giuseppe “Joe” Giudice, 44, both of Towaco, New Jersey, were sentenced to 15 months and 41 months in prison, respectively. Both defendants previously pleaded guilty before U.S. District Judge Esther Salas in Newark federal court to several counts of the superseding indictment returned against them in July 2013. The Giudices each pleaded guilty to one count of conspiracy to commit mail and wire fraud, one count of bankruptcy fraud by concealment of assets, one count of bankruptcy fraud by false oaths, and one count of bankruptcy fraud by false declarations. Giuseppe Giudice also pleaded guilty to one count of failure to file a tax return. Judge Salas also imposed the sentences today.
Judge Salas ordered Teresa Giudice to report to the Bureau of Prisons on Jan. 5, 2015, to begin serving her sentence. Giuseppe Giudice will report to serve his sentence after his wife finishes serving her prison term.
“The Giudices together deceived financial institutions with patently false loan applications; were dishonest when they sought the protection of the bankruptcy court and hid assets and income from the trustee; and Giuseppe Giudice cheated the government by failing to pay taxes on years of significant income,” U.S. Attorney Fishman said. “When they pleaded guilty, both admitted swearing to statements they knew were lies. Prison is the appropriate penalty for these serious financial crimes.”
“The Federal Deposit Insurance Corporation (FDIC) Office of Inspector General is pleased to join the U.S. Attorney’s Office and our law enforcement partners in this final phase of the prosecution,” Fred W. Gibson, FDIC’s Principal Deputy Inspector General, said. “Today’s sentences highlight the seriousness of offenses that undermine the integrity of the financial services industry. We are committed in our efforts to uncover such fraudulent schemes that cause harm to FDIC-insured institutions and to the Nation’s housing industry.”
“Reality hit home today for Giuseppe and Teresa Giudice,” Jonathan D. Larsen, Acting Special Agent in Charge, IRS-Criminal Investigation, Newark Field office, said. “They are now both convicted felons with prison sentences to serve. Choosing lies over the truth when dealing with the IRS, banks, and the bankruptcy court will not be tolerated.”
“Concealing assets and lying in a bankruptcy case are crimes, deserving of punishment,” Roberta A. DeAngelis, U.S. Trustee for Delaware, New Jersey and Pennsylvania (Region 3), said. “The Giudices remain responsible for paying their debts. They lost the protection our bankruptcy laws afford debtors because they broke the law to obtain it.”
According to documents filed in this case and statements made in court:
From September 2001 through September 2008, Giuseppe and Teresa Giudice engaged in a mail and wire fraud conspiracy in which they submitted fraudulent applications and supporting documents to lenders in order to obtain mortgages and other loans. The Giudices falsely represented on loan applications and supporting documents that they were employed and/or receiving substantial salaries when they were either not employed or not receiving such salaries.
In September 2001, Teresa Giudice applied for a $121,500 mortgage loan for which she submitted a loan application falsely claiming she was employed as an executive assistant. She also submitted fake W-2 forms and fake pay stubs purportedly issued by her employer. For a $361,250 mortgage loan that Teresa Giudice obtained in July 2005, she and Giuseppe Giudice prepared a loan application which falsely stated she was employed as a realtor and that she made a monthly salary of $15,000. In fact, Teresa Giudice was not employed at the time.
On Oct. 29, 2009, they filed a petition for individual Chapter 7 bankruptcy protection in U.S. Bankruptcy Court in Newark. Over the next few months, they filed several amendments to the bankruptcy petition. As part of the bankruptcy filings, the Giudices were required to disclose to the United States Trustee their assets, liabilities, income and any anticipated increase in income. The Giudices intentionally concealed businesses they owned, income they received from a rental property, and Teresa Giudice’s true income from the television show “The Real Housewives of New Jersey,” website sales, and personal and magazine appearances. The Giudices concealed their anticipated increase in income from the then-upcoming second season of the show. They also testified falsely under oath in bankruptcy proceedings when questioned about their assets and income.
Giuseppe Giudice also admitted that during tax years 2004 through 2008, he received income totaling $996,459 but did not file tax returns for those years.
In addition to the prison terms, Judge Salas sentenced Giuseppe and Teresa Giudice each to two years of supervised release, and ordered the couple to forfeit $414,588. Additionally, the judge fined Giuseppe Giudice $10,000 and fined Teresa Giudice $8,000.
Giuseppe Giudice was advised by the court that he faces deportation after serving his sentence. That decision will be made by U.S. Immigrations and Customs Enforcement following completion of his prison sentence.
U.S. Attorney Fishman credited special agents of the FDIC-OIG New York, under the direction of Principal Deputy Inspector General Gibson; special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Larsen; and Region 3 U.S. Trustee DeAngelis and the Newark office of the U.S. Trustee, with the investigation.
The government is represented by Assistant U.S. Attorney Jonathan W. Romankow of the U.S. Attorney’s Office Criminal Division, and Counsel to the U.S. Attorney Rachael A. Honig, in Newark.
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Defense counsel: Teresa Giudice: Henry E. Klingeman Esq., Newark
Giuseppe Giudice: Miles Feinstein Esq., Clifton, N.J.Washington Residents Indicted by Federal Grand Jury for Drug ConspiracyRead the Press Release
Anchorage, Alaska – U.S. Attorney Karen L. Loeffler announced today that two Washington residents have been indicted by a federal grand jury in Anchorage for Drug Conspiracy and Firearm violations.
Layten Scott Banchero, 28, and Scott Evan Banchero, 50, of Seattle, Washington, were both arraigned today before United States Magistrate Judge Leslie C. Longenbaugh on the charge of Drug Conspiracy and criminal forfeiture allegations. Layten Banchero was additionally charged with possession of a firearm in furtherance of a drug trafficking charge and felon in possession of a firearm. Both Layten and Scott Banchero pled not guilty to the charges and criminal forfeiture allegation. Both were ordered detained by the court pending trial.
According to the indictment, between on or about May 11, 2014, and continuing until July 15, 2014, the Bancheros conspired to distribute and to possess with the intent to distribute methamphetamine and heroin in Ketchikan, Alaska. During the course of the drug conspiracy, Layten Banchero, who is a convicted felon, possessed a number of firearms, and specifically possessed a loaded .357 magnum pistol during the commission of the underlying drug offense. Additionally, the indictment seeks to forfeit drug proceeds that total over $38,000 in U.S. currency seized from the defendants.
Assistant U.S. Attorney Jack S. Schmidt, who presented the case to the grand jury, indicated that the law provides for a mandatory minimum sentence of 10 years to life in prison, a fine of up to $10,000,000, or both for the drug conspiracy charge; the possession of a firearm in furtherance of a drug trafficking offense has a mandatory minimum of five years of imprisonment that must be consecutive to the underlying drug trafficking offense, and the felon in possession charge carries a maximum sentence of ten years imprisonment; both offenses carry a maximum fine of $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant. The trial is currently scheduled to be held in Ketchikan at a date to be further determined.
The Drug Enforcement Administration and the Ketchikan Police Department Drug Unit conducted the investigation leading to the indictment in this case.
An indictment is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.Virginia Man Pleads Guilty to Using Cellular Phone to Entice Minors from Across the Country to Produce Child PornographyRead the Press Release
RICHMOND, Va. – Dane Scott Mihlon, 25, of King George County, Va., pled guilty today to using the internet on his cellular phone to entice or attempt to entice at least 6 minors to produce child pornography.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; and Adam S. Lee, Special Agent in Charge of the FBI’s Richmond Field Office, made the announcement after the plea was accepted by United States District Judge John A. Gibney.
Mihlon was charged in a criminal information on October 2, 2014, with a single count of enticement of a minor, in violation of 18 U.S.C. § 2422(b). He faces a maximum penalty of life imprisonment when he is sentenced on January 14, 2015.
In a statement of facts filed with his plea agreement, Mihlon admitted to contacting 6 juvenile females through various cellular phone applications and enticing or attempting to entice them to produce sexually explicit pictures of themselves and send them to him over the internet. His victims ranged in age from 12 to 16 years old and were located across the country. On one occasion, Mihlon convinced a 15 year old victim living in Oregon to produce and send him over the internet at least five sexually explicit pictures.
This case was investigated by the Federal Bureau of Investigation. Assistant United States Attorney Erik S. Siebert is prosecuting the case on behalf of the United States.
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. 3:14-cr-098.
Van Zandt County Man Guilty of Federal Income Tax ViolationsRead the Press Release
Department of Justice
Office of Public AffairsTYLER, Texas - A 48-year-old Edgewood, Texas man has pleaded guilty to federal income tax violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Bruce Steven Martin pleaded guilty on Sep. 18, 2014, to willfully failing to file a federal tax return before U.S. Magistrate Judge Don D. Bush. Martin appeared before Judge Bush today for a detention hearing and was ordered to be detained.
According to information presented in court, Martin admitted to receiving income during calendar year 2010 and willfully failing to file an income tax return with the internal Revenue Service. Martin was indicted by a federal grand jury on Nov. 13, 2013. After he missed several court appearances, he was ordered to be detained. Martin faces up to 12 months in federal prison. A sentencing date has not been set.
This case is being investigated by the Internal Revenue Service-Criminal Investigation and prosecuted by Assistant U.S. Attorney J. Andrew Williams.
Utah Resident Sentenced to 57 Months in Federal Prison for Role in Investment Fraud SchemeRead the Press Release
Persuaded Investors To Invest IRA Funds In Residential Real Estate Project In Vernal, UtahSALT LAKE CITY - Armand R. Franquelin, age 57, of Liberty, Utah, who pleaded guilty in May to securities fraud and money laundering in connection with an investment fraud scheme related to a real estate project in Vernal, Utah, will serve 57 months in federal prison. U.S. District Judge Dale Kimball imposed the sentence Wednesday afternoon in U.S. District Court in Salt Lake City.
Judge Kimball also ordered Franquelin to pay restitution of $6,566.596.85 to victims of the fraud and to be on supervised release for three years when he finishes serving his prison sentence.
Franquelin and a co-defendant, Martin A. Pool, age 44, of Atlanta, Georgia, were charged in a three-count felony information filed in April. Both pled guilty in May to securities fraud and money laundering in connection with the scheme. Pool was sentenced to 78 months in federal prison in September.
As a part of a plea agreement reached with federal prosecutors, Pool and Franquelin admitted that from 2006 to 2010, they participated in persuading investors to convert their traditional IRAs to self-directed IRA accounts and invest their funds in a residential real estate project known as Haven Estates in Vernal, Utah. This was accomplished by inducing the investors to direct their funds to their company, The Elva Group, in return for notes promising monthly interest payments at annual rates between 8 percent and 20 percent. Pool and Franquelin admitted telling investors that their funds would be used to develop Haven Estates and promised to secure their loans with first lien positions in property at Haven Estates. In fact, no investors ever received any collateral or any interest in real property in Haven Estates or anywhere else.
In reality, the plea agreement says, investors’ funds were used for purposes other than the development of Haven Estates. Investors were not told of encumbrances already in place on Haven Estates. When Elva began defaulting on the mortgage loan for Haven Estates, investors were not immediately informed. Eventually, Haven Estates was foreclosed.
According to the plea agreement, investors’ funds were used by Pool and Franquelin and their associates for their personal benefit and to pay interest to earlier investors as Ponzi payments. The Ponzi payments had the effect of lulling the earlier investors, persuading them to leave their funds in the company and inducing them to renew their promissory notes from time to time. The payments also enticed new investors to invest.
The case was a multi-jurisdictional investigation by special agents of the FBI and IRS-Criminal Investigation; the Utah Department of Commerce, Division of Securities; and the Alabama Securities Commission with assistance from the office of Baldwin County, Alabama, District Attorney Hallie S. Dixon (28th Judicial Circuit). Alabama victims of the scheme invested more than $500,000.
Alabama Securities Commission Director Joseph Borg, said, "This Commission is proud to have joined the collaborative efforts of the federal and state law enforcement agencies and their professional staff members to see that justice is served for the victims in this important case. The outcome resulted from a team approach between the U.S. Attorney's Office in Utah, the Utah Department of Commerce's Division of Securities, the FBI, the IRS, and the ASC Enforcement and Legal Divisions to send a message that this financial crime, and others like it, will not be tolerated and will be prosecuted to the fullest extent of the law."
“The sentencing today demonstrates that taking money from investors under false pretenses and using it for your own personal benefit as Pool did won’t be tolerated. IRS Criminal Investigation is proud to bring our forensic accounting skills to this investigation and, working side-by-side with our law enforcement partners and prosecutors, help put a stop to this and other types of white collar crime,” said John Collins, IRS Criminal Investigation Special Agent in Charge of Utah.
U.S. Marshals Task Force Nabs Foreign FugitiveRead the Press Release
VALLEJO, Calif. – U.S. Marshal Don O’Keefe is proud to announce the arrest of Fermin Aguilar-Agueta, 26, a suspected MS-13 gang member, who is wanted in El Salvador for aggravated homicide.
Aguilar-Agueta is suspected by Salvadorian authorities of being involved in a drunken altercation between rival gang factions, which resulted in the shooting death of an individual in March 2007. He was formally charged with aggravated homicide in El Salvador in 2009. An Interpol Red Notice was issued by El Salvador in 2013 for Aguilar-Agueta initiating an international manhunt.
On September 22, Aguilar-Agueta was spotted in a vehicle by Concord Police Department officers during a routine traffic stop. Officers gathered information about him, as well as his associates, and forwarded the information to the U.S. Marshals Fugitive Task Force, which specializes in the apprehension of domestic and foreign fugitives.
The following day, based on the information from the Concord Police, and in coordination with Deputy U.S. Marshals at Interpol Washington, the U.S. National Central Bureau (USNCB), in Washington, D.C., the U.S. Marshals Service Pacific Southwest Regional Fugitive Task Force in the Bay Area, which consists of several federal, state, and local agencies, to include officers from Immigration and Customs Enforcement (ICE), were able to determine that Aguilar-Agueta was residing illegally in the U.S., and that he had no record of legal entry.
U.S. Marshals Task Force members located the vehicle associated with the traffic stop at the 1200 block of Georgia Street, Vallejo, CA, and established surveillance. Soon after, Aguilar-Agueta was spotted getting into the vehicle. A traffic stop was conducted and he was taken into custody without incident. Aguilar-Agueta is currently in immigration custody pending deportation.
To find more information on fugitives currently being sought by the U.S. Marshals in Northern California, or to submit an anonymous tip on the whereabouts of a fugitive, please visit: http://northerncaliforniamostwanted.org. The U.S. Marshals Service is the primary federal agency charged with conducting fugitive investigations throughout the country. The U.S. Marshals regularly works in concert with other federal, state, and local law enforcement agencies to seek out and arrest violent fugitives and sex offenders, and has established task forces throughout the nation to facilitate the apprehension of fugitives. aguilar_agueta_press_release.pdf
Two Indicted on Drug Trafficking Charges After Arrests in Stockton; Three Indicted for Growing Marijuana in Lassen National ForestRead the Press Release
SACRAMENTO, Calif. — A federal grand jury returned three indictments today for charges of trafficking cocaine and heroin and cultivating marijuana in a national forest, United States Attorney Benjamin B. Wagner announced.
99 Kilograms (218 lbs) of Cocaine Seized
In the first indictment, Todd Andrew Ayster, 49, of Long Beach, was charged with possession of cocaine with intent to distribute. According to court documents, on August 31, 2014, Aster was arrested after a CHP officer conducted a traffic stop in Stockton. A strong odor of axle grease was coming from the vehicle, and the officer’s K9 alerted to narcotics at two locations on the exterior of the vehicle. A subsequent search of the vehicle and attached camper led to the recovery of 99 kilograms of cocaine. This case is the product of an investigation by the California Highway Patrol and the Drug Enforcement Administration.Heroin, Cocaine, and Firearms Seized
In the second indictment, Cedric Sewell, 46, of Hayward, was charged with possession with intent to distribute heroin, possession with intent to distribute cocaine, possession of a firearm in furtherance of a drug trafficking crime, and being a felon in possession of a firearm. According to court documents, on March 5, 2014, law enforcement officers searched Sewell’s residence in Stockton and seized over five kilograms of heroin, 500 grams of cocaine, several firearms (including an AR-15 assault rifle), approximately $67,000 in cash, a money counter, and a cache of ammunition. This case is the product of an investigation by the Alameda County Narcotics Task Force and the Drug Enforcement Administration.Two Large Marijuana Cultivation Sites Eradicated from Lassen Forest
In the third indictment, Tiburcio Olmos Munoz, Adalid Rosales Lopez, and Venustiano Gonzalez-Jauregui, were charged with conspiracy to cultivate marijuana plants in the Lassen National Forest. According to court documents, on August 25, 2014, law enforcement agents served a search warrant at a large cultivation site in the Lassen National Forest. Gonzalez-Jauregui was there, and 6,769 marijuana plants were eradicated from the site. That same day, agents discovered a nearby site but due to exposure to highly toxic pesticides used in the first grow site, were unable to explore the second site that day. On September 4, 2014, law enforcement agents returned to the second site and arrested Munoz and Lopez. This case is the product of an investigation by the United States Forest Service, the Shasta County Sheriff’s Office, and the California Department of Fish and Wildlife.If convicted, Ayster, Munoz, Lopez and Gonzalez-Jauregui face a maximum statutory penalty of life in prison and a $10 million fine. If convicted, Sewell faces maximum sentences of life in prison and fines up to $20 million for the drug possession charges and a maximum statutory penalty of 10 years in prison and a $250,000 fine for being a felon in possession of a firearm. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
Assistant United States Attorney Olusere Olowoyeye is prosecuting all three cases. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
Three Men Indicted for Lying About Casino LandAllegedly Concealed Charles Lightbody’s Financial Interest from Wynn Resorts and the Massachusetts Gaming CommissionRead the Press Release
BOSTON – Three men have been indicted on state and federal charges in connection with their efforts to hide the financial interest of a convicted felon in a parcel of land in Everett from Wynn Resorts, Limited (Wynn Resorts) and from state gaming regulators, U.S. Attorney Carmen Ortiz and Attorney General Martha Coakley’s Office announced today. The men all held a financial interest in FBT Everett Realty LLC (FBT), which held title to a parcel of land Wynn Resorts has proposed to locate a destination resort casino.
Charles Lightbody, 54, of Revere, Dustin DeNunzio, 37, of Cambridge, and Anthony Gattineri, 56, of Winchester, were indicted yesterday by a federal grand jury for their role in concealing from Wynn Resorts and Massachusetts gaming regulators the financial interests of Lightbody, a convicted felon and known New England Family of La Cosa Nostra (NELCN) associate, in the land and to obtain money from Wynn Resorts in exchange for the land. Each is charged with conspiracy to commit wire fraud, wire fraud and aiding and abetting.
It is alleged that, between December 2012 and July 2013, in order to conceal Lightbody’s financial interest from Wynn Resorts and the Massachusetts Gaming Commission (MGC), DeNunzio, Gattineri and Lightbody represented to others that Lightbody transferred his interest in FBT to Gattineri in exchange for a $1.7 million promissory note and arranged for the creation and execution of two fraudulent versions of documents reflecting the transaction. In addition, on Jan. 17, 2013, DeNunzio sent an email to Wynn Resorts falsely stating that DeNunzio, Gattineri and a third individual were the only people who had interest in FBT, when in fact Lightbody had a financial interest in FBT. In July 2013, DeNunzio, Gattineri and Lightbody also misled the MGC’s investigators about Lightbody’s interest in the land.
In addition to the federal charges, on Monday, a state grand jury charged Lightbody, DeNunzio and Gattineri with impeding a gaming investigation, conspiracy and tampering with evidence. Lightbody was also indicted for assault and battery on a person over 60 resulting in bodily injury. Those indictments were unsealed today.
It is alleged in the state indictments that in the summer of 2013, Lightbody, DeNunzio and Gattineri made concerted efforts to conceal Lightbody’s partnership in FBT, the entity that owns the Everett Parcel, on which Wynn Resorts proposes to build a casino, from the MGC investigators.
Despite attempts by Lightbody, DeNunzio and Gattineri to show that Lightbody was no longer a partner of FBT during FBT’s negotiations with casino companies, investigators determined that Lightbody was, in fact, still a partner at that time. The state investigation revealed that these three defendants allegedly attempted to hide Lightbody’s involvement in the company because he has a criminal record.State authorities also allege that Lightbody assaulted a man during a casino election rally in Revere on Oct. 12, 2013.
All three defendants, who were arrested today, will appear in U.S. District Court in Boston at a time to be determined. They will also be arraigned in Middlesex Superior Court at a later date and Lightbody will be arraigned on the assault charge in Suffolk Superior Court also at a later date.
The conspiracy statute provides a sentence of no greater than five years in prison, three years of supervised release, and a fine of $250,000, or twice the gross gain or loss, whichever is greater. The wire fraud statute provides a sentence of no greater than 20 years in prison, three years of supervised release, and a fine of $250,000, or twice the gross gain or loss, whichever is greater. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
On the state charges all of the defendants face up to five years in jail.
The federal case is being investigated jointly by the Federal Bureau of Investigation in Boston, the Massachusetts State Police and the Massachusetts Department of Correction, in collaboration with the Attorney General’s Office. The federal case is being prosecuted by Kristina E. Barclay of Ortiz’s Public Corruption Unit.
The state case is being prosecuted by Assistant Attorneys General David Rubin and Patrick Hanley of AG Coakley’s Gaming Enforcement Division. The case was investigated by the State Police assigned to the AG’s Gaming Enforcement Division in collaboration with the FBI and the U.S. Attorney’s Office. The AG’s Office received assistance from the Suffolk County District Attorney’s Office, the Revere and Everett Police Departments, the Massachusetts Department of Corrections, and the State Police Fusion Center.
For information on the state charges, please contact Brad Puffer at the Attorney General’s Office at 617-727-2543.