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Monday 18 August 2014
Wichita Area Man Sentenced to 9+ Years for Distributing Child PornographyRead the Press Release
WICHITA, KAN. A Wichita area man was sentenced Monday to 110 months in federal prison for trading files over the Internet with a Missouri man who was producing child pornography, U.S. Attorney Barry Grissom said.
Jaime Menchaca, 34, Kechi, Kan., pleaded guilty to one count of distributing child pornography. In his plea, he admitted that on Sept. 13, 2013, he sent an email containing child pornography to a Missouri man.
At sentencing, prosecutors argued that Menchaca knew the Missouri man was actively producing child pornography and he was hoping to swap for access to more of it. According to court records, Menchaca’s email said: “Would love to see more of (victim’s name withheld) and anything else you may have. Here are some pics and vids I hope you enjoy.”
Grissom commended Homeland Security Investigations (HSI), the Wichita Police Department, the Kansas Internet Crimes Against Children Task Force investigated and Assistant U.S. Attorney Jason Hart for their work on the case.
U.S. Attorney Luger Announces Charges for More Than $2 Million Stolen in Three Unrelated Coin Fraud SchemesRead the Press Release
United States Attorney Andrew M. Luger today announced the August 6, 2014 indictment of DENNIS CHARLES HELMER, a/k/a “Jeff Jones,” a/k/a, “Mr. Diamond,” a/k/a, “Dennis Dimon,” 53, for devising an elaborate coin fraud scheme and defrauding victims of over $1 million. HELMER is charged with 16 counts of Mail Fraud and three counts of Wire Fraud. In an unrelated indictment unsealed on August 12, 2014, TORY EVAN HUGHES, 44, is charged with Mail Fraud in a similar coin fraud scheme. In a third unrelated case, a felony Information was filed on July 22, 2014, in federal court charging CHRYSANTHOS NICHOLAS, 55, with one count of Mail Fraud.“Minnesota has more than its share of coin fraud,” said U.S. Attorney Luger. “In completely unrelated cases, these three defendants are charged with defrauding unsuspecting victims of more than $2 million dollars in total. Working with federal, state, and local law enforcement partners, we are investigating and prosecuting those who prey on vulnerable victims.”
According to the indictment, HELMER operated Wholesale Assets Worldwide, LLC (WAW), which engaged in appraising, buying, selling, and trading of coins and precious metals. From November 2009 to
December 2013, through WAW, HELMER contacted individuals, many of whom were elderly, and persuaded them to send him money, coins, and precious metals, based on his false promises to provide money or coins in return. Some victims also relied on HELMER to provide safe storage for their coins. As
part of the scheme, HELMER intentionally misled customers about the size and stability of his business, including providing them with copies of a false “Dun and Bradstreet Credibility Report,” and stating that WAW had 75 employees and $500 million in annual revenue.According to court documents, WAW received over $1.2 million in coins, precious metals, and cash from victims. Instead of fulfilling their orders, HELMER sold many of the coins and used customers’ money and proceeds from those sales to fulfill other orders, make payments to other customers, pay his own personal expenses, and attempt to fund start-up costs for another company, Smoke Shack, Inc.
According to the indictment, HELMER at different times used various aliases, including “Jeff Jones,” in an attempt to hide his prior criminal charges for similar conduct in both Dakota and Hennepin Counties. In November 2013, when HELMER learned that WAW was under investigation, he moved his coin fraud operation to Florida. In January 2014, HELMER formed Best Price International, LLC and continued to operate his scheme to defraud customers, this time under the aliases, “Mr. Diamond” and “Dennis Dimon.”
In an unrelated indictment unsealed on August 12, 2014, TORY EVAN HUGHES, 44, is charged with Mail Fraud in a similar coin fraud scheme. According to the indictment, HUGHES owned and operated Reputable Rare Coins, LLC (RRC), located in Roseville, Minnesota. HUGHES bought and sold gold, silver and other coins. The defendant and his sales staff made unsolicited phone calls, primarily to elderly individuals, in an attempt to sell or buy coins. Several customers sent money and coins to HUGHES and received nothing in return. HUGHES is charged with stealing more than $600,000 in cash and coins.
According to the indictment, in November 2013, HUGHES moved his coin fraud operation to Gilbert,
Arizona, where he continued to victimize elderly individuals in the same manner as he had done through RRC. Through his new business, U.S. Collectables, HUGHES stole more than $100,000 from customers intending to purchase coins.In a third unrelated case, a felony Information was filed on July 22, 2014, in federal court charging CHRYSANTHOS NICHOLAS, 55, with one count of Mail Fraud. NICHOLAS is scheduled to make his first appearance before United States District Court Chief Judge Michael J. Davis on August 20, 2014.
According to the information, NICHOLAS owned and operated two coin businesses, TWC Trading (TWC)
and North Fork Six Rare Coin Consultants (North Fork), located in New York State. Both businesses
evaluated, stored, bought, sold and traded coins and precious metals. Through TWC and North Fork,
NICHOLAS entered into contracts with clients to evaluate, store, and sell their coins; however, NICHOLAS did not pay his clients or return the coins to the clients upon their request. Through this scheme NICHOLAS stole more than $200,000 of coins and precious metals.Assistant U.S. Attorney Kimberly Svendsen is handling the case against DENNIS CHARLES HELMER.
Assistant U.S. Attorney Karen Schommer is handling the cases against TORY EVANS HUGHES, and
CHRYSANTHOS NICHOLAS.The U.S. Postal Inspection Service investigated the HELMER and HUGHES cases. The Minnesota
Department of Commerce also investigated the HELMER case. The Roseville Police Department also
worked the HUGHES investigation.
The Federal Bureau of Investigation conducted the NICHOLAS investigation.
Defendant Information:DENNIS CHARLES HELMER, D.O.B. 2/3/1961
Farmington, MN
Charges:
• Mail Fraud, 16 counts
• Wire Fraud, 3 counts
TORY EVAN HUGHES, D.O.B. 12/8/1969
Minneapolis, MN
Charges:
• Mail Fraud, 1 count
CHRYSANTHOS NICHOLAS, D.O.B. 1/22/1959
Mettituck, NY
Charges:
•Mail Fraud, 1 countThe charges contained in an indictment are mere allegations and defendants are presumed innocent unless and until proven guilty.
Two Suburban Men Indicted on Federal Gun Charges for Allegedly Illegally Possessing 40 FirearmsRead the Press Release
CHICAGO ― Two suburban men are facing federal gun charges for allegedly illegally possessing 40 firearms, and one of them was also charged with selling firearms without a federal license between 2010 and 2011, federal law enforcement officials announced today.
One defendant, WALTER FREEMAN, also known as “Charlie” and “Cha-Lay,” 35, whose last known residence was in Lisle, was charged with one count each of being a felon-inpossession of firearms, possession of stolen firearms, and dealing firearms without a federal license. Co-defendant, TIMOTHY VANA, 53, of Forest Park, was charged with one count each of being a felon-in-possession of firearms and possession of stolen firearms.
Both defendants are scheduled to be arraigned at 11 a.m. Wednesday before Magistrate Judge Susan Cox in U.S. District Court. They were charged together in a three-count indictment returned by a federal grand jury last Thursday.
According to the indictment, between October 2010 and July 2011, Freeman and Vana illegally possessed 40 assorted firearms, both as previously convicted felons and because they had reason to believe that those same firearms were stolen. Freeman was also charged with engaging in the business of dealing firearms without a federal license during the same time period. The firearms included various 9 and 25 mm, and .22, .38, and .45 caliber pistols.
Being a felon-in-possession of firearms and possessing stolen firearms each carry a maximum of 10 years in prison, and dealing firearms without a federal license carries a maximum sentence of five years in prison, and each count carries a $250,000 maximum fine. If convicted, the court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines.
The indictment was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois, and Carl J. Vasilko, Special Agent-in-Charge of the Chicago Office of the Bureau of Alcohol, Tobacco, Firearms, and Explosives. The Cook County Sheriff’s Police and the Illinois State Police assisted in the investigation. The government is being represented by Assistant U.S. Attorney Jennie Levin.
The public is reminded that an indictment is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Indictment
Two Individuals Indicted for Conspiracy to Defraud the IRS and Filing False Tax ReturnsRead the Press Release
NASHVILLE, Tenn.- Jeffrey Cephus McCoy, 68, and Andra L. McCoy, 65, both of Brentwood, Tenn. were arrested by IRS agents this morning and charged with filing false tax returns and with conspiracy to defraud the United States in the collection of income taxes, announced David Rivera, U. S. Attorney for the Middle District of Tennessee. Both were indicted by a federal grand jury in Nashville on August 13, 2014.
According to the indictment, beginning in 2002, the McCoys conspired to defeat the lawful function of the Internal Revenue Service in its assessment, computation, and collection of income taxes. The McCoys are alleged to have filed false and fraudulent joint tax returns for tax years 2003- 2007, which included hundreds of thousands of dollars in false and fictitious withholding amounts.
The indictment also alleges that the McCoys placed assets in the names of others and submitted false and fraudulent paperwork to the IRS in order to obstruct the IRS’s assessment and collection of their taxes. During the times alleged in the indictment, Jeff McCoy earned compensation for his services as a radiologist from various healthcare providers with whom he contracted.
If convicted, each defendant faces up to five years in prison and a fine of $250,000 on the conspiracy charge, and three years in prison and a fine of up to $250,000 on each of five counts of filing a false tax return.
This investigation was conducted by the Internal Revenue Service – Criminal Investigation. Assistant U.S. Attorney Kathryn W. Booth represents the government.
An indictment is merely an accusation and is not evidence of guilt. The defendants are presumed innocent unless and until proven guilty in a court of law.
Tribal Member Admits to Smoke Shop BurglaryRead the Press Release
COEUR D'ALENE - Joseph Reno Stensgar, 36, of Plummer, Idaho, pleaded guilty on August 19, 2014 to burglary, U.S. Attorney Wendy J. Olson announced. Stensgar was indicted by a federal grand jury in Coeur d'Alene on May 20, 2014.
According to the plea agreement, Stensgar admitted that on January 3, 2014, he agreed to enter the Stubby Lake Smoke Shop in order to seal cartons of cigarettes. During the course of the burglary, cigarettes, cash, a laptop computer, car keys, and 2012 Subaru Forrester were taken by Stensgar and another person. The crime happened on the Coeur d’Alene Reservation.
The charge of Burglary is punishable by at least one year and up to ten years in prison, a maximum fine of $250,000.00, and up to three years of supervised release.
Sentencing is set for November 12, 2014, before U.S. District Judge Edward J. Lodge at the federal courthouse in Coeur d'Alene.
The case was investigated by Coeur d’Alene Tribal Police and the Federal Bureau of Investigation (FBI).
Suffolk Woman Sentenced to 15 Years for Her Role in Conspiracy to Produce Child PornographyRead the Press Release
NORFOLK, Va. – Sierra Danyelle Halsey, 23, of Suffolk, Virginia, was sentenced today to 15 years in prison, followed by lifetime supervised release, for production of child pornography and obstruction of justice.
Dana J. Boente, United States Attorney for the Eastern District of Virginia, and Clark Settles, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Washington, made the announcement after sentencing by U.S. District Judge Robert G. Doumar.
Halsey pleaded guilty on May 5, 2014. According to court documents, Halsey became involved in the conspiracy when she was contacted by coconspirator Robert Harold Scott, Jr. under his assumed online identity of “Mike Pyro.” Scott would routinely communicate with women in and around the Tidewater area to set up “sex parties,” where the women would work as prostitutes and Scott would pay them for their services. In reality, Scott would not pay them and sometimes would extort the women by threatening to publish sexually explicit videos. In addition to the adult parties, Scott was found to be conspiring with and producing child pornography with several different women, including Halsey. Law enforcement found that, when discussing the sex parties, sometimes Scott would request these women to produce child pornography and was very specific as to the sex acts he wanted done on camera. Halsey complied in return for the promise of money. Specifically, Halsey produced child pornography on several occasions with a 1 year old and a 5 year old. Halsey also obstructed justice by deleting electronic evidence at the behest of Scott after he was arrested in the Fall of 2013.
This case was investigated by Homeland Security Investigations. Assistant U.S. Attorney Elizabeth M. Yusi prosecuted the case.A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov
St. Francis Man Charged with Sexual Abuse of A Minor and Making False Statement to Federal AgencyRead the Press Release
United States Attorney Brendan V. Johnson announced that a St. Francis, South Dakota, man has been indicted by a federal grand jury for Sexual Abuse of a Minor and Making False Statement to a Federal Agency.
Luke Two Eagle, age 19, was indicted on July 15, 2014. He appeared before U.S. Magistrate Mark A. Moreno on August 1, 2014, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 15 years in custody and/or a $250,000 fine, up to life of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on or about April 10, 2014, and April 30, 2014, Two Eagle engaged in a sexual act with a minor who had not attained the age of 16. On May 1, 2014, Two Eagle told a federal officer that the victim had left his residence, when he in fact knew this statement was not true.
The charge is merely an accusation and Two Eagle is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Federal Bureau of Investigation and the Rosebud Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Tim Maher is prosecuting the case.
Two Eagle was released on bond pending trial. A trial date has been set for September 23, 2014.
Sioux Falls Man Sentenced to 41 Months for Possession with Intent to Distribute HeroinRead the Press Release
United States Attorney Brendan V. Johnson announced that a Sioux Falls, South Dakota, man convicted of Possession With Intent to Distribute a Controlled Substance was sentenced on August 11, 2014, by Judge Karen E. Schreier.
Denardo LaVelle Cunningham, age 40, was sentenced to 41 months in custody, three years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Cunningham was indicted by a federal grand jury on October 8, 2013, for Possession With Intent to Distribute a Controlled Substance and Possession of a Firearm by a Prohibited Person. He pled guilty to Possession With Intent to Distribute a Controlled Substance on May 12, 2014.
At the time of his arrest, Cunningham was found with over 200 bags of heroin packaged for resale.
This case was investigated by the Sioux Falls Area Drug Task Force, Sioux Fall Police Department, South Dakota Division of Criminal Investigation, Drug Enforcement Administration, and Bureau of Alcohol, Firearms, Tobacco, and Explosives. Special Assistant U.S. Attorney Jennifer D. Mammenga prosecuted the case.
Serial Robber Sentenced to over 12 Years in PrisonRead the Press Release
Robbed Seven Businesses and Employees; Attempted to Rob a Take-Out Restaurant
Greenbelt, Maryland – Chief U.S. District Judge Deborah K. Chasanow sentenced Duane James, age 53, of Germantown, Maryland today to 151 months in prison for five counts of robbery.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Acting Special Agent in Charge William P. McMullan of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; and Chief J. Thomas Manger of the Montgomery County Police Department.
According to his plea agreement, on seven occasions from January 21 to February 17, 2013, James robbed Maryland businesses and their employees, each time wearing a ski mask and pointing what appeared to be a gun at the store clerks. In Silver Spring, James stole $50 and $10,000 worth of jewelry at The Gold Spot store; $110 from the store register and $100 from the clerk’s wallet at the AT&T store; and $3,000 from the cash drawer and lottery proceeds at the Bel Pre Beer & Wine store. In Rockville, James stole $1,500 from the register at the Shell Gas Station. In Gaithersburg, James stole $400 from the store register and $5 from the clerk at the Walnut Hill Liberty Gas Station; $300 from the cash register and $200 from the clerk at Twinbrook Shell Gas Station; and $1,043 from the register and cigarettes at the Exxon Gas Station.Also, on February 17, 2013 and prior to robbing the Exxon gas station that same day, James pointed what appeared to be a gun at a clerk at a take-out restaurant in Gaithersburg, demanding cash from the register. The clerk did not move or open the drawer. James left the store.
United States Attorney Rod J. Rosenstein praised the ATF and Montgomery County Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Daniel C. Gardner and Adam Ake, who prosecuted the case.
Sanger Man Charged with Stealing Batteries from U.S. Mail TrucksRead the Press Release
FRESNO, Calif. — Rene Garcia, 47, of Sanger, will be arraigned in federal court today, charged with stealing government property, United States Attorney Benjamin B. Wagner announced.
According to the indictment, on 12 separate occasions between September 2012 and March 2013, Garcia stole vehicle batteries from U.S. Postal Service mail trucks parked at the U.S. Post Office in Selma. In total, Garcia stole approximately 51 batteries.
This case is the product of an investigation by the U.S. Postal Inspection Service. Assistant United States Attorney Christopher Baker is prosecuting the case.
If convicted of the charges, Garcia faces a maximum statutory penalty of 10 years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Registered Sex Offender in Hamilton County Pleads Guilty to Federal Child Porn ChargeRead the Press Release
WICHITA, KAN. A registered sex offender from Hamilton County, Kan., pleaded guilty Monday to a federal child pornography charge, U.S. Attorney Barry Grissom said.
Wade H. Dewey, 47, Syracuse, Kan., pleaded guilty to one count of possessing child pornography. In his plea, he admitted that on Aug. 2, 2013, in Syracuse he was found in possession of images and videos depicting child pornography. He obtained the child pornography via the Internet.
Dewey previously was convicted in 1999 in Pueblo, Colo., on a charge of criminal attempt to commit sexual assault on a child.
Sentencing is set for Nov. 3. Both parties have agreed to recommend a sentence of 20 years.Grissom commended the Hamilton County Sheriff’s Office, Homeland Security Investigations, the Wichita Police Department and Assistant U.S. Attorney Jason Hart for their work on the case.
Rapid City Man Charged with Failure to Register as A Sex OffenderRead the Press Release
United States Attorney Brendan V. Johnson announced that a Rapid City, South Dakota, man has been indicted by a federal grand jury for Failure to Register as a Sex Offender.
Jeffrey Jandreau, age 35, was indicted on July 15, 2014. He appeared before U.S. Magistrate Judge Mark A. Moreno on August 1, 2014, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in custody and/or a $250,000 fine, a mandatory minimum period of supervised release of 5 years up to life, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that between June 25, 2014, and July 1, 2014, Jandreau knowingly failed to register and update his registration.
The charge is merely an accusation and Jandreau is presumed innocent until and unless proven guilty.
The investigation is being conducted by the U.S. Marshals Service. Assistant U.S. Attorney Meghan N. Dilges is prosecuting the case.
Jandreau was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
Petaluma Slaughterhouse Owners and Employees Charged in Scheme to Distribute Adulterated MeatRead the Press Release
SAN FRANCISCO – An Indictment against one of two owners, as well as two employees, of the now-defunct Rancho Feeding Corporation, a livestock slaughterhouse located in Petaluma, Calif., was unsealed today in federal court, announced United States Attorney Melinda Haag and Special Agent in Charge Lori Chan, USDA Office of Inspector General, Investigations. The two also announced charges, in the form of an Information, against Rancho’s other owner. All of the defendants are charged with violating the Federal Meat Inspection Act (FMIA) by fraudulently processing and distributing condemned and diseased cattle.
The Indictment, returned by a federal grand jury in San Francisco on Aug. 14, 2014, charges Rancho owner Jesse “Babe” Amaral, Jr., 76, Eugene Corda, 65, both of Petaluma, Calif., and Felix Cabrera, 55, of Santa Rosa, Calif., with distribution of adulterated, misbranded, and uninspected meat, in violation of 21 U.S.C. §§ 610(c) & 676(a); conspiracy to commit the same, in violation of 18 U.S.C. § 371; and mail fraud conspiracy in furtherance of the same scheme, in violation of 18 U.S.C. § 1349. The Indictment also charges Amaral with mail fraud, in violation of 18 U.S.C. § 1341, and mail fraud conspiracy, in violation of 18 U.S.C. § 1349, in a separate scheme to defraud farmers by means of false invoicing. The Information charges Rancho owner Robert Singleton, 77, of Petaluma, Calif., with one count of distribution of adulterated, misbranded, and uninspected meat, in violation of 21 U.S.C. §§ 610(c) & 676(a).
According to the charging documents, between mid to late 2012 and Jan. 10, 2014, Amaral instructed Cabrera to process cattle that had been condemned by the U.S. Department of Agriculture (USDA) veterinarian. Based on this instruction, Cabrera directed Rancho employees under his supervision to carve “USDA Condemned” stamps out of the cattle carcasses and to process the carcasses for transport, sale, and distribution. As a result of this conspiracy, Rancho distributed more than one hundred condemned cattle.
The charging documents also allege that, during this same time frame, Amaral and Singleton directed Cabrera and Corda to circumvent inspection procedures for cattle showing signs of epithelioma, or “cancer eye,” a disease that can result in condemnation. Specifically, the Indictment and Information allege that, at Amaral’s and Singleton’s instructions, Rancho employees including Cabrera and Corda engaged in a scheme to slaughter cancer eye cows during USDA inspectors’ lunch breaks, a time during which plant operations were supposed to cease, and then to conceal the diseased cow heads by swapping them with healthy cow heads for the purpose of post mortem inspections. As a result, Rancho distributed approximately 79 diseased cattle that did not undergo full USDA inspection.
Additionally, the Indictment alleges that, between 2012 and January 2014, Amaral conspired to and did fraudulently charge farmers “handling fees” based on false statements that their cattle had died or been condemned, when in fact he knew that the cattle had been sold for human consumption.
As a result of this investigation, in February 2014, Rancho voluntarily recalled approximately 8.7 million pounds of beef products.
Amaral’s and Corda’s initial appearances on the Indictment took place this morning in federal court in San Francisco. Amaral has been released on a $50,000 secured bond, and Corda was scheduled for a bond hearing today at 1:30 p.m. before U.S. Magistrate Judge Laurel Beeler. Singleton’s initial appearance on the Information is scheduled for Friday, Aug. 22, 2014, at 9:30 a.m. before U.S. Magistrate Judge Nathanael Cousins in San Francisco. Cabrera has not yet made his initial appearance.
The maximum statutory penalties for conspiracy to distribute adulterated meat are 5 years’ imprisonment, 3 years’ supervised release, a $250,000 fine, and a $100 special assessment. The maximum statutory penalties for fraudulent distribution of adulterated meat are 3 years’ imprisonment, 1 year supervised release, a $10,000 fine, and a $100 special assessment. The maximum statutory penalties for mail fraud and mail fraud conspiracy are 20 years’ imprisonment, 3 years’ supervised release, a $250,000 fine, and a $100 special assessment. Notwithstanding these statutory maximums, any sentence imposed by the court following conviction would take into consideration the U.S. Sentencing Guidelines and the federal statute governing imposition of a sentence, 18 U.S.C. § 3553. In addition, an indictment merely alleges that crimes have been committed. All defendants are presumed innocent until proven guilty beyond a reasonable doubt.
Hartley M.K. West is the Assistant U.S. Attorney who is prosecuting this case with the assistance of Rosario Calderon. The prosecution is the result of an investigation by agents of the USDA’s Office of Inspector General, Investigations, and USDA’s Food Safety Inspection Service, Office of Investigation, Enforcement and Audit, Compliance and Investigations.
(Rancho Feeding Corporation information )
(Rancho Feeding Corporation indictment )
Parmelee Man Charged with Assault with A Dangerous Weapon and Assault Resulting in Serious Bodily InjuryRead the Press Release
United States Attorney Brendan V. Johnson announced that a Parmelee, South Dakota, man has been indicted by a federal grand jury for Assault with a Dangerous Weapon and Assault Resulting in Serious Bodily Injury.
Franklin Running Horse, age 48, was indicted on July 15, 2014. He appeared before U.S. Magistrate Mark A. Moreno on July 31, 2014, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in custody and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on or about April 10, 2014, in Todd County, Running Horse assaulted the victim with a dangerous weapon, that is, shod feet, and the assault resulted in serious bodily injury.
The charge is merely an accusation and Running Horse is presumed innocent until and unless proven guilty.The investigation is being conducted by the Rosebud Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Tim Maher is prosecuting the case.
Running Horse was remanded to the custody of the U.S. Marshal’s Service pending trial. A trial date has not been set.
Orlando Man Sentenced to 9 Years in Prison for Armed RobberyRead the Press Release
Orlando, FL – U.S. District Judge Roy B. Dalton, Jr. today sentenced Darin Leon Givens (32, Orlando) to a total of 9 years in federal prison for the robbery of a retail store and the use and carrying of a firearm during that robbery. The Court also ordered Givens to forfeit the firearm and ammunition used in the crime and to serve a 5-year term of supervision following his incarceration. Givens pleaded guilty on May 20, 2014.
According to court documents, on March 7, 2014, at approximately 7:00 a.m., Givens and another individual, both wearing masks, entered the CVS store located at 9975 Lake Underhill Road in Orlando. Givens approached CVS employee/victim A.R., pulled out a handgun, and pointed it at A.R. Givens demanded money and told A.R. to take him and his accomplice to the safe in the store’s office. A.R. complied with Givens’ demands and led the robbers to the store’s office.
When they arrived at the office, A.R. knocked on the door and asked CVS employee/victim E.V. to let them in. E.V. opened the office door, and the robbers pushed A.R. into the office. Once inside, Givens told A.R. to open the safe or he would shoot. After A.R. opened the store’s safes, Givens and his accomplice took approximately $4,300. Givens and his accomplice told A.R. and E.V. to lie down on the ground. The robbers then zip-tied their victims’ hands behind their backs and fled with the cash. Law enforcement officers caught Givens and his accomplice as they ran to their getaway car that was parked on the side of the road near the store.
This case was investigated by the Federal Bureau of Investigation and the Orange County Sheriff’s Office. It was prosecuted by Assistant United States Attorney Joseph M. Schuster.
Operator of Financial Consulting Firm Sentenced to 46 Months’ Imprisonment for Investment FraudRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that on August 15, 2014, United States District Court Judge Malachy E. Mannion sentenced August John Stile, Jr., age 50, of Hughestown, Pennsylvania, to 46 months’ imprisonment. In October 2013, Stile pleaded guilty to defrauding investors of approximately $310,000. This was Stile’s second federal conviction for fraud since 2001.
Stile was the purported Vice President of JFC Group and the President of Stile Consulting. JFC Group had an office in Dickson City, Pennsylvania, and Stile Consulting had office in Exeter, Pennsylvania. Stile was indicted on the fraud charges in April 2013.
According to United States Attorney Peter Smith, between 2007 and 2009, Stile schemed to defraud private investors by fraudulently offering short-term investment opportunities based upon a promise of a return of the investment with substantial interest in less than 90 days. In one instance, Stile promised an investor a payout of $265,000 in return for a short-term investment of $25,000-—the payout to occur in roughly 40 days.
Rather than investing the money he received as promised, Stile used the funds for his own purposes which included the purchase of vehicles, and improvements to his other property.
Judge Mannion sentenced Stile to the top of the applicable Sentencing Guidelines range. In addition to the imprisonment term, Judge Mannion ordered Stile to pay restitution to the victims in the amount of $327,500. Judge Mannion denied Stile’s request for a delay to begin his sentence and ordered him immediately into custody.
Stile was previously prosecuted in federal court for fraud in 2001 and was sentenced to a prison term. In 2011, he was sentenced to an additional 14 months in federal prison for violating the terms of his supervised release in that case as a result of the fraudulent investment scam activity that led to his indictment in the present case.
The case was investigated by the Federal Bureau of Investigation. Assistant U.S. Attorney John Gurganus prosecuted the case.
Omaha Businessman Sentenced for Failing to Pay over Withholding TaxesRead the Press Release
Chief United States District Court Judge Laurie Smith Camp sentenced Randall J. Thompson, age 65 of Omaha, Nebraska, upon his conviction for failing to pay over to the IRS the federal income taxes which had been withheld from his employees’ paychecks. Judge Smith Camp sentenced Thompson to six months imprisonment to be followed by three years of supervised release. Thompson was also ordered to pay restitution to the IRS in the amount of $95,505.42.
Thompson formed a company called American Medical Files, LLC (hereinafter referred to as “AMF”) in 2006. He served as the President and CEO of AMF from its inception through 2008. Thompson maintained control of AMF’s financial accounts and was the person responsible for paying over to the IRS the payroll taxes which had been withheld from AMF’s employees’ paychecks.
AMF was required to make deposits of the payroll taxes to the IRS on a periodic basis. In addition, AMF was required to file, following the end of each calendar quarter, an Employer’s Quarterly Federal Income Tax Return (Form 941) setting forth the total amount of wages and other compensation subject to withholding, the total amount of income tax withheld, the total amount of Social Security and Medicare taxes due, and the total tax deposits. Although the Form 941 was filed by AMF for the last quarter of 2007 and the first quarter of 2008, Thompson failed to pay over to the IRS the payroll taxes that had been withheld. The total amount that should have been paid for these two quarters was $95,505.42.
The investigation revealed that during the last quarter of 2007 and the first quarter of 2008, AMF took in approximately $775,000 and paid out approximately $982,000. The amount paid out by AMF included distributions to Thompson which far exceeded the amount of withholding taxes which should have been paid to the IRS.
“Business owners have a responsibility to withhold income taxes for their employees and then remit those taxes to the Internal Revenue Service,” said Sybil Smith, Special Agent in Charge of IRS Criminal Investigation. “The failure to pay over withheld taxes results in lost tax revenue to the United States and the possible loss of future social security or Medicare benefits for the employees.”
This case was investigated by IRS Criminal Investigations.
New York Man Pleads Guilty to Passing Counterfeit CurrencyRead the Press Release
Contact: Michael J. Conley
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced that
Andrew Cupidore, 21, of New York, New York, pled guilty today in U.S. District Court before
Judge D. Brock Hornby to passing counterfeit U.S currency.According to court records, on April 21, 2014, a police officer patrolling the Maine Mall
in South Portland located four female minors from New York who were using counterfeit $100
bills to pay for purchases in the mall. The officer seized over $1000 in counterfeit $100 bills
from the minors. The investigation revealed that Cupidore gave the minors the counterfeit bills
and told them to pass them in the mall and to return change from the transactions to him.
Officers located Cupidore hiding in a mall restroom and seized nine counterfeit $100 bills from
him.Cupidore faces up to 20 years in prison and a $250,000 fine. He will be sentenced after
completion of a presentence investigation report by the U.S. Probation Office.The investigation was conducted by the U.S. Secret Service, the South Portland Police
Department and the Seabrook and Newington, New Hampshire Police Departments.Mission Woman Charged with Assault with A Dangerous Weapon and Assault Resulting in Serious Bodily InjuryRead the Press Release
United States Attorney Brendan V. Johnson announced that a Mission, South Dakota, woman has been indicted by a federal grand jury for Assault with a Dangerous Weapon and Assault Resulting in Serious Bodily Injury.
Misty Swalley, age 24, was indicted on July 15, 2014. She appeared before U.S. Magistrate Mark A. Moreno on July 31, 2014, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in custody and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on or about June 25, 2014, in Todd County, Swalley assaulted the victim with a dangerous weapon, that is a sharp edged instrument, and the assault resulted in serious bodily injury.
The charge is merely an accusation and Swalley is presumed innocent until and unless proven guilty.The investigation is being conducted by the Rosebud Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Tim Maher is prosecuting the case.
Swalley was remanded to the custody of the U.S. Marshal’s Service pending trial. A trial date has not been set.
Minnesota Man Pleads Guilty to Laundering Drug ProceedsRead the Press Release
COEUR D'ALENE - Allan R Hayes, 30, of Minnesota, pleaded guilty today to conspiracy to commit money laundering, U.S. Attorney Wendy J. Olson announced. Hayes was indicted by a federal grand Jury in Coeur d'Alene on February 20, 2013.
According to the plea agreement, on January 22, 2013, Hayes was stopped for traffic violations. Pursuant to consent, the officer searched the vehicle and found over $200,000 in the trunk. The defendant admitted the money was proceeds from the sale of marijuana. Hayes told the officer that he was taking the money from Minnesota to California to pay for marijuana that was previously supplied and sold.
The charge of conspiracy to commit money laundering is punishable by up to 20 years in prison, a maximum fine of $500,000.00, and up to three years of supervised release.
Sentencing is set for November 12, 2014, before U.S. District Judge Edward J. Lodge at the federal courthouse in Coeur d'Alene.
The case was investigated by the North Idaho Violent Crimes Task Force.
Milwaukee Man Sentenced to 40 Years in Federal Prison for Production of Child PornographyRead the Press Release
United States Attorney James L. Santelle announced that Elia V. Orlando, (age: 26) of Milwaukee, Wisconsin, was sentenced to 40 years imprisonment, followed by a lifetime of supervised release for four counts of production of child pornography. Each count involved a separate child between the ages of two and three years. It should be noted that on March 4, 2010, Orlando was convicted of Possession of Child Pornography in state court.
According to documents released in court, on August 1, 2013, Orlando inadvertently left his cellular phone at a gas station in Cudahy, Wisconsin. A citizen noticed that Orlando had left the phone behind and attempted to return it to him. When she was unsuccessful in catching Orlando before he left the parking lot, the citizen opened the phone with the intention of obtaining information on the owner. While looking for ownership information that citizen stumbled upon images she believed to child pornography. The citizen, who resides in Milwaukee, turned the phone over to the Milwaukee Police Department.
The Milwaukee Police Department was able to determine the ownership of the telephone and the location of Orlando the same day they were contacted by the citizen. When Orlando was questioned by police officers, he admitted the phone was his and that he was in possession of child pornography. A forensic examination by the High Technology Unit of the Milwaukee Police Department revealed additional images of child pornography that were produced by Orlando. Orlando befriended several of the parents of the young children and was ultimately entrusted with their care.
This case was prosecuted in federal court as part of “Project Safe Childhood,” the Department of Justice’s nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children using the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.The case was investigated by the Milwaukee Police Department. The case was prosecuted by Assistant United States Attorney Penelope L. Coblentz.
Methamphetamine Manufacturing Conspirator SentencedRead the Press Release
The United States Attorney, Kenyen R. Brown, announced today the sentencing of Janet Marie Boykin. Judge William H. Steele sentenced Janet Marie Boykin to a year and a day imprisonment. Boykin, 53, of Robertsdale, was indicted in July of 2013 along with seven co-defendants, charged with conspiracy to manufacture methamphetamine. The conspiracy began in or about 2009 and continued through 2013. She entered a guilty plea to the conspiracy charge in March of 2014 and was sentenced this morning.
Judge Steele ordered that Boykin would undergo drug testing and treatment as a condition of a four-year term of supervised release, which will follow the custody sentence. The judge also ordered that Boykin pay $100 in special assessments, but no fine was imposed.
The case was investigated by the Loxley Police Department, the Baldwin County Drug Task Force, and the Baldwin County Sheriff’s Office. It was prosecuted in the United States Attorney's Office by Assistant United States Attorney Gloria Bedwell.
Merritt Island Man Pleads Guilty to Production of Child Pornography and Attempted Online Enticement of A MinorRead the Press Release
Orlando, Florida – United States Attorney A. Lee Bentley, III announces that Michael Glenn Glascock (39, Merritt Island) pleaded guilty today to one count of using a minor to produce images depicting child pornography and one count of attempting to induce a minor to engage in illegal sexual activity using an interstate facility. Glascock faces a mandatory minimum penalty of 15 years, up to 30 years in federal prison on the child pornography count, and a mandatory minimum of 10 years, up to life in federal prison on the attempted enticement count, as well as a potential life term of supervised release on each count. Glascock was indicted on February 19, 2014.
According to court documents, from on or about October 11, 2012 through October 11, 2013, in Brevard County, and elsewhere, Glascock used a three-year-old minor victim to produce visual depictions of the child engaging in sexually explicit conduct. In the fall of 2013, an undercover agent with the Brevard County Sheriff’s Office responded to an online advertisement which Glascock posted on Craigslist. On October 11, 2013, the undercover agent communicated with Glascock over the Internet and by cell phone. In these communications, Glascock described his sexual abuse of the minor victim and expressed an interest in meeting the undercover agent and the undercover agent’s fictitious minor daughter. Glascock further expressed a desire to engage in illegal sexual activity with the fictitious minor daughter and offered to allow the undercover agent to engage in illegal sexual activity with the minor victim. After Glascock agreed to meet the undercover agent, agents went to Glascock’s home on Merritt Island, where they met Glascock and located the minor victim.
During an interview, Glascock admitted to producing child pornography images of the minor victim, to sexually abusing the minor victim as depicted in some of the images, and to distributing and receiving images of child pornography over the Internet. Agents also executed a search warrant at Glascock’s home and recovered his cell phones, SD cards, and the digital camera that he admitted to using to produce some of the child pornography involving the minor victim. A forensic examination of these devices revealed that there were 24 images depicting explicit sexual conduct involving the minor victim on one of the SD cards.
Agents also searched Glascock’s email accounts and discovered child pornography images of the minor victim in emails that Glascock had sent to another individual. In these and other emails, Glascock had many discussions with other individuals about his sexual abuse of the minor victim. In a series of emails discovered by agents, Glascock and an individual identified to be Jonathan Tyler Prive discussed an incident where Prive sexually abused the minor victim at Glascock’s home, as Glascock watched the abuse. After discovering these emails, the undercover agent conducted an investigation that led to Prive’s arrest. Prive was also indicted by a federal grand jury on February 19, 2014.
An indictment is merely a formal charge that a defendant has committed a violation of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the Brevard County Sheriff’s Office and U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). It is being prosecuted by Assistant United States Attorney Andrew C. Searle.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Mayfield Village Doctor Forfeits $650,000 After Importing Misbranded DrugsRead the Press Release
A Mayfield Village rheumatologist was sentenced to probation for importing medications that had not been approved by the Federal Drug Administration, said Steven M. Dettelbach,United States Attorney for the Northern District of Ohio.
Dr. David Mandel, 65, has paid more than $650,000 in restitution. He previously pleaded guilty to causing the shipment of misbranded drugs, a misdemeanor violation of the Food, Drug and Cosmetic Act.
“FDA’s regulatory standards are designed to ensure the safety and quality of the medical devices and drugs distributed to American consumers,” said Antoinette V. Henry, Special Agent in Charge, FDA’s Office of Criminal Investigations, Washington Field Office. “We will continue to work to investigate all persons, including medical professionals, who disregard regulatory requirements and jeopardize the public health by participating in the distribution of misbranded products.”
“Acquiring and prescribing prescription medications that have not met regulatory standards puts the safety and well-being of patients at risk,” said Lamont Pugh III, Special Agent in Charge, U.S. Department of Health & Human Services, Office of Inspector General –Chicago Region. “The OIG will continue to work with our law enforcement partners to ensure that medical professionals who choose to evade these standards are held accountable.”
Dr. Mandel obtained Boniva, Aclasta, Prolia, Euflexa and Orthovisc, from outside the United States, where the drugs are not approved by the FDA, according to court documents.
A drug may be considered misbranded even if it is identical in composition to an FDA-approved drug (that is, a drug labeled and packaged in compliance with the FDA’s standards) and even if it was made by the same manufacturer in the same facility as the FDA-approved version.
The case was prosecuted by Assistant U.S. Attorney Michael L. Collyer following investigations by the FDA – Office of Criminal Investigations and the Department of Health and Human Services – Office of Inspector General.
Anyone suspecting health care fraud, waste or abuse can report it by calling the U.S. Department of Health and Human Services, Office of Inspector General at800-447-8477.To learn more about healthcare fraud prevention and enforcement go towww.stopmedicarefraud.gov
Mattawan Man Sentenced to 30 Years in Federal Prison for Multiple Counts of Attempted Sexual Exploitation of A Child and Other Related ChargesRead the Press Release
GRAND RAPIDS, MICHIGAN – James Alfred Beckman, Jr., 39, of Mattawan, Michigan was sentenced to 30 years in federal prison for multiple counts of Attempted Sexual Exploitation of a Child, Attempted Coercion and Enticement of a Child, and Receipt and Distribution of Child Pornography, U.S. Attorney Patrick A. Miles, Jr. announced today. In addition to the prison term, U.S. District Judge Janet T. Neff ordered Beckman to pay $32,480 in restitution to multiple victims, and Judge Neff imposed a lifetime term of supervised release that will commence once Beckman is released from imprisonment. Beckman will also be required to register as a sexual offender.
A jury returned guilty verdicts on these counts on March 11, 2014, after a two-week trial. The evidence presented at trial showed that the defendant sexually abused and exploited two young children during 2012. He streamed and attempted to stream live video of this abuse and exploitation to others. In exchange, he received child pornography and other things he deemed of value. The defendant’s conduct came to light when one of his victims disclosed the abuse to another adult. The Michigan State Police and the Federal Bureau of Investigation then launched an investigation. The investigation revealed a network of individuals trafficking in child pornography. Two of the defendant’s accomplices testified against him.
During the sentencing proceeding, Judge Neff stated that Beckman’s conduct was “about as serious as it gets,” and she stated that it would be difficult to imagine a more serious offense. She stated that on a scale from 1 to 10, this case was “way past 10.” U.S. Attorney Miles echoed these sentiments, stating, “The seriousness of Beckman’s crimes cannot be overstated. Preying upon children and exploiting them while also feeding the online demand for child pornography are extremely damaging to children and to our society. Protecting the vulnerable is a top priority of federal law enforcement. Child sex predators are being pursued relentlessly by local, state and federal authorities.”
“The perpetrator in this case, who egregiously exploited and sexually abused young children, is among the worst of the worst offenders” stated Paul M. Abbate, Special Agent in Charge of the FBI Detroit Field Office. “Those who prey upon our children must know that state and federal authorities will be relentless in our efforts to protect and keep children safe, and will bring to bear the full weight of justice upon those who violate their innocence.”
This case is part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. The U.S. Attorney's Office, county prosecutor's offices, the Internet Crimes Against Children task force (ICAC), 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 local 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 the following web site: www.projectsafechildhood.gov. Individuals with information or concerns about possible child exploitation should contact local law enforcement officials.
The Federal Bureau of Investigation (FBI) and the Michigan State Police (MSP) investigated the case. Assistant U.S. Attorneys Sean M. Lewis and Timothy P. Verhey prosecuted the case.
END
Man Charged with Three Bank RobberiesRead the Press Release
BOSTON – Edward Stone, 25, made his initial appearance in U.S. District Court today where he is charged with three bank robberies. The indictment, which was returned July 31, 2014, alleges that during a three-week period in June 2014, Stone robbed two TD Bank branches in Braintree, and one in Hingham.
The charging statute provides a sentence of no greater than 20 years in prison, three years of supervised release, a fine of $250,000, and restitution in the approximate amount of $18,000. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.United States Attorney Carmen M. Ortiz; Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Chief Russell Jenkins of the Braintree Police Department; and Chief Michael Peraino of the Hingham Police Department, made the announcement today. The investigation was also assisted by the Massachusetts State Police and the Boston FBI Violent Crimes Task Force. The case is being prosecuted by Brian A. Pérez-Daple of Ortiz’s Major Crimes Unit.
The details contained in the indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Man Admits to Unlawful Possession of A Firearm on Kootenai ReservationRead the Press Release
COEUR D'ALENE - William Gene Andrews, 53, of Bonners Ferry, Idaho, pleaded guilty today to unlawful possession of a firearm, U.S. Attorney Wendy J. Olson announced. Andrews was indicted by a federal grand jury in Coeur d'Alene on July 15, 2014.
According to the court documents, Andrews admitted that on June 9, 2014, he possessed a Hi-Point .45 caliber semi-automatic pistol on the Kootenai Reservation after having previously been convicted of a felony. Andrews was convicted of possession of a controlled substance in Boundary County in 2008.
The charge of unlawful possession of a firearm is punishable by up to ten years in prison, a maximum fine of $250,000.00, and up to three years of supervised release.
Sentencing is set for November 12, 2014, before U.S. District Judge Edward J. Lodge at the federal courthouse in Coeur d'Alene.
The case was investigated by the Kootenai Tribal Police and the FBI.
Lewiston Man Pleads Guilty to AssaultRead the Press Release
COEUR D'ALENE - James Spencer, Jr., 33, of Lewiston, Idaho, was sentenced today to 30 months in prison followed by three years of supervised release for assault resulting in serious bodily injury, U.S. Attorney Wendy J. Olson announced. U.S. District Judge Edward J. Lodge also ordered Spencer to pay $388.22 in restitution and a $100 special assessment. He pleaded guilty to the charge on May 27, 2014.
According to court documents, on September 27, 2012, within the boundaries of the Nez Perce Indian Reservation, Spencer intentionally struck the victim, causing the victim to lose two teeth. Both the defendant and the victim are members of the Nez Perce Tribe.
The case was investigated by Federal Bureau of Investigation (FBI) and Nez Perce Tribal Police.
Leader of Maritime International Drug Transportation Organization Arraigned in BrooklynRead the Press Release
Earlier today, Jair Estupinan-Montano was arraigned at the federal courthouse in Brooklyn, New York, on charges relating to international narcotics trafficking. Estupinan-Montano was arrested in Panama on October 14, 2013, on a provisional arrest warrant issued from the Eastern District of New York.
The arraignment was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, and James J. Hunt, Acting Special Agent-in-Charge, Drug Enforcement Administration (DEA), New York Division.
According to court filings, prior to his arrest, Estupinan-Montano was the leader of a narcotics trafficking organization responsible for transporting shipments of cocaine from Colombia to locations in Central America and Mexico for ultimate delivery to the United States. Estupinan-Montano allegedly worked closely with the violent “Los Rastrojos” drug trafficking organization, a paramilitary organization that employed hundreds of individuals and controlled drug trafficking along the Pacific coast of Colombia. Estupinan-Montano was responsible for arranging boats and submarines that transported the cocaine from Colombia to other members of his organization in Central America, who then transported the cocaine north to be sold to Mexican cartels for eventual shipment to the United States. A detention memo filed today by the government details that, between 2010 and 2012, the United States Coast Guard seized two ships and a semi-submersible vessel that had been sent from Colombia by Estupinan-Montano. In total, those vessels contained over 7,200 kilograms of cocaine when they originally left South America.
“Evoking Jules Verne, the defendant Estupinan-Montano relied on boats and submarines to ferry his illegal cargo, and was an essential link in the flow of illegal narcotics from Colombia to the United States, ” stated United States Attorney Lynch. “The illegal narcotics trade is a scourge, both in the United States and throughout the world. With the help of our international allies, we will continue to strike at those who enrich themselves off this violent industry wherever they are found.” Ms. Lynch thanked the Drug Enforcement Administration, New York Division; the Drug Enforcement Administration’s Bogota Country Office and Panama Express Task Force; the United States Coast Guard; the Department of Justice Office of International Affairs; and the Republic of Panama for their help in investigating and capturing Estupinan-Montano.
The defendant was arraigned this afternoon before United States Magistrate Judge Steven M. Gold at the federal courthouse in Brooklyn. The charges in the indictment are merely allegations, and the defendant is presumed innocent unless and until proven guilty.
The government’s case is being prosecuted by Assistant United States Attorneys Tyler Smith, Amir Toossi, Justin Lerer, and Robert Polemeni.
The Defendant:
JAIR ESTUPINAN-MONTANO
Age: 31
COLOMBIA
E.D.N.Y. Docket No. 12-CR-793 (SLT)
Estupinan Montano Arraignment Press Release Submarine Photo
Estupinan Montano Arraignment Press Release Submarine Photo 2
Leader of $20 Million Fraud Scheme Involving Bogus Prescriptions for Expensive Anti-Psychotics Sentenced to 8 Years in Federal PrisonRead the Press Release
LOS ANGELES – The leader of a $20 million health care fraud scheme based at a Glendale medical clinic was sentenced today to eight years in federal prison for overseeing a plot to fraudulently prescribe expensive anti-psychotic medications and to sell those drugs back to pharmacies through the black market, where the drugs would be billed to the government over and over.
Lianna “Lili” Ovsepian, 33, of Tujunga, was sentenced this morning by United States District Judge S. James Otero, who stated that “we can’t have a situation where crime pays.” In addition to the prison term, Judge Otero ordered Ovsepian to pay $9,146,137 in restitution to Medicare and Medi-Cal.
Last November, Ovsepian pleaded guilty to conspiracy to commit health care fraud and conspiracy to commit identity theft.
Ovsepian was the manager and owner of Manor Medical Imaging, Inc. in Glendale, which generated thousands of fraudulent prescriptions for unneeded and expensive anti-psychotic medications for “patients” who were typically low-income beneficiaries of the government-funded health care programs Medicare and Medi-Cal, and who did not need those drugs. The prescriptions appeared to be issued by co-conspirator Dr. Kenneth Johnson, who pre-signed thousands of blank prescriptions that were filled out by Ovsepian’s mother-in-law, Nuritsa Grigoryan.
The beneficiaries who received the prescriptions were brought to pharmarcies, where the prescriptions were filled. The drugs were returned to Manor, the “patients” were given nominal payments (usually around $100), and the drugs were diverted into the black market, where they were sold to other pharmacies and re-billed to health care programs as though the drugs were being dispensed for the first time.
As prosecutors argued at sentencing, the beneficiaries included veterans recruited from dual diagnosis programs for drug addiction and schizophrenia, elderly Medicare beneficiaries whose identities were stolen and homeless beneficiaries recruited from skid row.
From September 2009 through October 27, 2011, when the scheme was shut down by authorities, Medi-Cal and Medicare was billed more than $20 million, and the programs paid more than $9.1 million to pharmacies based on more than 14,000 claims submitted in relation to the scheme, prosecutors wrote in a sentencing brief filed in Ovsepian’s case.
The case involving Manor was the first one in the nation alleging an organized scheme to defraud government health care programs through fraudulent claims for anti-psychotic medications. The case is also the largest of its kind in Southern California involving a fraud targeting Medicare Part D.
Following a trial earlier this year, Dr. Johnson, Grigoryan and Ovsepian’s brother, Artak Ovsepian, were found guilty of a host of charges related to the scheme (see: http://www.justice.gov/usao/cac/Pressroom/2014/023.html). Those three defendants are currently pending sentencing.
Ovsepian oversaw a scheme that involved several family members and other co-conspirators. A total of 16 defendants have been convicted either through guilty pleas or by jury verdicts.
Other defendants who were charged in this case include a Pasadena couple whose Huntington Pharmacy in San Marino saw its business grew dramatically due its affiliation with Manor Medical. The owner of the pharmacy, Phic Lim, is scheduled for trial in this case in March 2015.
The investigation in this case, which was called Operation “Psyched Out,” was conducted by the San Marino Police Department; the California Department of Justice, Bureau of Medi-Cal Fraud and Elder Abuse; the United States Food and Drug Administration, Office of Criminal Investigations; IRS-Criminal Investigation; the United States Department of Health and Human Services, Office of the Inspector General; U.S.
Immigration and Customs Enforcement’s Homeland Security Investigations; the Glendale Police Department, Organized Crime Team; and the California Department of Health Care Services, Audits and Investigations Branch.Release No. 14-107
Justice Department Sues to Stop Florida Tax Return PreparerRead the Press Release
The United States has asked a federal court in Tampa, Florida, to stop Octavio Cruz and his company, Advantage Accounting Corp., from preparing federal income tax returns for others, the Justice Department announced today.
Cruz has been preparing tax returns since approximately 1998 with the assistance of his family. Operating first as Cruz and Cruz Accounting, and later as Advantage Accounting Corp., Cruz directly or indirectly prepared more than 30,000 tax returns for customers since 2009. The complaint alleges that Cruz prepares returns that unlawfully understate income tax liabilities and overstate refunds by fabricating and/or exaggerating deductions and tax credits his clients are not eligible to take. Cruz’s practices include fabricating losses for nonexistent businesses on customers’ Schedule C – Profit or Loss From Business, and falsely claiming child care and residential energy credits for which they were not eligible and did not incur. Cruz also prepared returns which falsely claimed American Opportunity Credits for taxpayers who did not incur the education expenses or go to college. Altogether, the complaint alleges that loss to the U.S. Treasury from the defendant’s activities may total millions of dollars.
Return-preparer fraud is one of the Internal Revenue Service’s (IRS) Dirty Dozen Tax Scams for 2014 . The IRS has some tips on their website for choosing a tax preparer. In the past decade, the Tax Division has obtained injunctions against hundreds of fraudulent tax preparers. Information about these cases is available on the Justice Department website . An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page . If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Related Materials:
United States v. Octavio Cruz, et al.
Complaint for Permanent InjunctionJudge Gives Sex Trafficker Long Prison TermRead the Press Release
PHILADELPHIA –Rahim McIntyre, 35, of Philadelphia, PA, was sentenced today to 262 months in prison for three counts of sex trafficking. McIntyre, a/k/a “King Kobra,” ran a prostitution business in Philadelphia and other major cities between early 2006 and late 2012. McIntyre recruited unsuspecting girls ages 18 and younger and then psychologically manipulated them to comply with his demands through physical violence. He obtained numerous photographs of each victim in lingerie and then caused Internet advertisements to be created in which he advertised them as available for purchase for purposes of prostitution. A federal jury found McIntyre guilty, on April 21, 2014, of using force and coercion to cause the women to engage in prostitution.
In addition to the prison term, U.S. District Court Judge Harvey R. Bartle ordered restitution of $5,200 per victim, a $300 special assessment, and eight years of supervised release.
McIntyre’s brother, Rashaad McIntyre, was charged in December 2012 with sex trafficking of minors and production of child pornography. He pleaded guilty and is awaiting sentencing.
The case was investigated by the Federal Bureau of Investigation, with assistance from the Pennsylvania State Police Criminal Intelligence Center, and the Philadelphia First Judicial Court Warrant Unit. It is being prosecuted by Assistant United States Attorney Michelle Morgan.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Jackson Woman Sentenced to 92 Months in Prison for Stolen Identity Refund FraudRead the Press Release
Jackson, Miss. – Nikki Thomas, 37, of Jackson, was sentenced today by U.S. District Judge Henry T. Wingate to 92 months in federal prison followed by three years of supervised release for stolen identity refund fraud, announced U.S. Attorney Gregory K. Davis. Thomas was also ordered to pay restitution to the IRS in the amount of $771,956.27.
Thomas conspired to defraud the government by using personal identifying information, including names and social security numbers which had been stolen from the Central Mississippi Correctional Facility, the University of Mississippi Medical Center and other locations. The information was then used by Thomas and her co-conspirators to file false tax returns with the Internal Revenue Service. The tax returns claimed that the tax payers were owed a refund. Refunds were then electronically deposited into various bank accounts in Mississippi belonging to Thomas and her co-conspirators.
This case was investigated by the United State Secret Service and the Internal Revenue Service. Assistant U.S. Attorney Patrick Lemon is prosecuting the case.If you believe you have been a victim of fraud from a person or an organization soliciting relief funds on behalf of storm victims, contact the National Center for Disaster Fraud toll free at:
(866) 720-5721
You can also fax information to:
(225) 334-4707
or e-mail it to:
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Hostage Taking Sends Four Mexican Nationals to PrisonRead the Press Release
McALLEN, Texas – Four Mexican nationals, who kidnapped a group of foreign nationals who had been smuggled into the U.S. by another smuggling group, have been sentenced to lengthy federal prison terms, announced United States Attorney Kenneth Magidson. Andres Perez-Moshan, 37, Humberto Alvarez-Cheo, 25, Roberto Salinas-Martinez, 29, and Euclides Moreno-Dominguez, 34, of Mexico and themselves illegally in the U.S., pleaded guilty to one count of hostage taking on Feb. 18, 2011, before Chief U.S. District Judge Ricardo H. Hinojosa.
Today, Judge Hinojosa sentenced Moreno-Dominguez to 204 months in prison. On Friday, Aug. 15, 2014, the court handed Perez-Moshan a 264-month term, while Alvarez-Cheo and Salinas-Martinez were each sentenced to 120 months in prison. As illegal aliens, they are all expected to face deportation proceedings following their release from prison.
According to court records, on Nov. 24, 2008, the four defendants entered a stash house at an unknown location near Mission and kidnapped approximately 21 foreign nationals – all illegally in the United States. The defendants forcibly took them by gunpoint to a mobile home north of Edinburg where they were all arrested by Border Patrol agents the next day. At the time of arrest, agents seized three handguns with corresponding ammunition.
While at the Edinburg stash house, the four had forced the foreign nationals to strip, took all of their possessions, held them against their will and forced them to contact family members in the United States or abroad to extort a ransom for their release. The foreign nationals were threatened with the loss of their lives if they did not comply or if the ransom money was not received. Additionally, three of the female foreign nationals reported that Perez-Moshan and Moreno-Dominguez had sexually assaulted them.
All four defendants have been in custody since their arrest where they will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
This case was investigated by Homeland Security Investigation and Border Patrol. Assistant United States Attorneys Anibal J. Alaniz and Linda Requénez are prosecuting.
Google Tip Leads to 30-Year Prison SentenceRead the Press Release
FRESNO, Calif. — United States District Judge Lawrence J. O’Neill sentenced Alan Kendrick, 47, of Escalon, to 30 years in prison, to be followed by a lifetime term of supervised release, for his conviction of one count of receiving and distributing child pornography, United States Attorney Benjamin B. Wagner announced.
According to a criminal complaint, Google reported to the National Center for Missing & Exploited Children (NCMEC) that on December 10, 2013, six images of suspected child pornography were associated with a Google account. NCMEC referred the matter to law enforcement, and a detective with the Ceres Police Department discovered that the Google account had been accessed from residences in Modesto and Escalon. Kendrick was a registered sex offender on GPS location monitoring, and GPS records confirmed that he was at the residences when the accounts had been accessed. He admitted in a plea agreement that between June and December 2013, he received and distributed images of child pornography and also admitted that he had engaged in a pattern of abuse or exploitation of a minor.
“This case is another example of the successful partnership among the corporate, nonprofit, and law enforcement community,” said Supervisory Special Agent Todd Irinaga of the Sacramento FBI’s Modesto office. “The report of Kendrick’s illicit activity, even though he was still on parole, was immediately routed to the Sacramento Valley High Tech Crimes Task Force. The team, in conjunction with California Department of Corrections and Rehabilitation and with significant assistance from the Ceres Police Department’s High Tech Crime unit, investigated this horrible crime and ensured successful prosecution of Kendrick for his crime that victimized innocent children.”
At Kendrick’s first initial appearance in federal court on March 11, 2014, he was ordered detained as a danger to the community and a flight risk. He pleaded guilty on May 27, 2014.
This case was the result of an investigation by the Ceres Police Department and the Modesto FBI Office with assistance from the California Department of Corrections and Rehabilitation Division of Adult Parole Operations. Assistant United States Attorney David Gappa prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about Internet safety education.
Fort Thompson Man Charged with Assault by Strangulation and Suffocation and Domestic Assault by A Habitual OffenderRead the Press Release
United States Attorney Brendan V. Johnson announced that a Fort Thompson, South Dakota, man has been indicted by a federal grand jury for Assault by Strangulation and Suffocation and Domestic Assault by a Habitual Offender.
Santana Drapeau, age 22, was indicted on July 15, 2014. He appeared before U.S. Magistrate Judge Mark A. Moreno on August 4, 2014, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in custody and/or a $250,000 fine, 3 years of supervised release, and $300 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on or about May 18, 2014, Drapeau unlawfully assaulted an adult female victim by strangling and suffocating her. Drapeau also unlawfully committed a domestic assault upon the same victim when he had a final conviction, on at least two separate prior occasions for offenses that would have been, if subject to federal jurisdiction, an assault against a spouse or intimate partner.
The charges are merely accusations and Drapeau is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Bureau of Indian Affairs, Crow Creek Agency. Assistant U.S. Attorney Meghan N. Dilges is prosecuting the case.
Drapeau was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
Former Rabobank LIBOR Submitter Pleads Guilty for Scheme to Manipulate Yen LIBORRead the Press Release
A former Coöperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank) Japanese Yen London InterBank Offered Rate (LIBOR) submitter pleaded guilty today for his role in a conspiracy to commit wire and bank fraud by manipulating Rabobank’s Yen LIBOR submissions to benefit trading positions.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Deputy Assistant Attorney General Brent Snyder of the Justice Department’s Antitrust Division and Acting Assistant Director in Charge Timothy A. Gallagher of the FBI’s Washington Field Office made the announcement.
Paul Robson, a citizen of the United Kingdom, appeared before United States District Judge Jed S. Rakoff in the Southern District of New York and pleaded guilty to count one of a 15-count indictment returned by a federal grand jury in the Southern District on April 28, 2014. Sentencing is scheduled for June 9, 2017.
“ Paul Robson is the second employee at Rabobank, one of the world’s largest banks, to plead guilty to participating in a global fraud scheme,” said Assistant Attorney General Caldwell. “The scope of the fraud was massive, but the scheme was simple. By illegally influencing the LIBOR rates, Robson and his coconspirators rigged the markets to ensure that their trades made money. Robson’s conviction demonstrates the Department of Justice’s continued resolve to hold individuals and institutions accountable for their involvement in fraud in the financial markets.”
“Today’s guilty plea demonstrates our continuing resolve to prosecute those who fraudulently manipulated the LIBOR rate for their own personal benefit and, in doing so, undermined free and fair markets,” said Deputy Assistant Attorney General Snyder.
“Fraudulently manipulating the LIBOR has far reaching effects on international financial markets and such criminal activity will not be tolerated,” said Acting Assistant Director in Charge Gallagher. “The Washington Field Office has committed significant time and resources including the expertise of Special Agents, forensic accountants and analysts to investigate this case along with our Department of Justice colleagues. While the crimes committed are complex, their expertise demonstrates our ability to bring justice to those that choose to commit these crimes.”
Robson, along with former Rabobank Yen LIBOR derivatives traders Paul Thompson, of Australia, and Tetsuya Motomura, of Japan, was charged with conspiracy to commit wire and bank fraud as well as substantive counts of wire fraud. The indictment also alleges that the conspiracy involved numerous additional, unnamed individuals and entities. Among those individuals and entities are:· Takayuki Yagami (described in the indictment as Trader-R), a Japanese national and former Rabobank trader who pleaded guilty on June 10, 2014, in the Southern District of New York to one count of conspiracy to commit wire and bank fraud for his involvement in the conspiracy alleged in the indictment; and
· Lloyds Banking Group plc (LBG), a U.K.-based bank that, as part of a deferred prosecution agreement filed in the United States District Court for the District of Connecticut on July 28, 2014, admitted wrongdoing in connection with the alleged conspiracy’s overt acts, and agreed to pay an $86 million penalty.
According to court documents, LIBOR is an average interest rate, calculated based on submissions from leading banks around the world, reflecting the rates those banks believe they would be charged if borrowing from other banks. LIBOR serves as the primary benchmark for short-term interest rates globally and is used as a reference rate for many interest rate contracts, mortgages, credit cards, student loans and other consumer lending products. The Bank of International Settlements estimated that as of the second half of 2009, outstanding interest rate contracts were valued at approximately $450 trillion.
At the time relevant to the charges, LIBOR was published by the British Bankers’ Association (BBA), a trade association based in London. LIBOR was calculated for 10 currencies at 15 borrowing periods, known as maturities, ranging from overnight to one year. The published LIBOR “fix” for Yen LIBOR at a specific maturity is the result of a calculation based upon submissions from a panel of 16 banks, including Rabobank.
Rabobank entered into a deferred prosecution agreement with the Department of Justice on Oct. 29, 2013, and agreed to pay a $325 million penalty to resolve violations arising from Rabobank’s LIBOR submissions.
According to court documents, Robson worked as a senior trader at Rabobank’s Money Markets and Short Term Forwards desk in London and also served as Rabobank’s primary submitter of Yen LIBOR to the BBA; Thompson was Rabobank’s head of Money Market and Derivatives Trading Northeast Asia and worked in Singapore; Motomura was a senior trader at Rabobank’s Tokyo desk who supervised money market and derivative traders; and Yagami worked as a senior trader at Rabobank’s Money Market/FX Forwards desks in Tokyo and elsewhere in Asia.
Robson’s main role in the conspiracy was to submit Yen LIBOR rates at the requests of traders, including Thompson, Motomura and Yagami, who entered into derivatives contracts containing Yen LIBOR as a price component . T he profit and loss that flowed from those contracts was directly affected by the relevant Yen LIBOR on certain dates. If the relevant Yen LIBOR moved in the direction favorable to the defendants’ positions, Rabobank and the defendants benefitted at the expense of the counterparties. When LIBOR moved in the opposite direction, the defendants and Rabobank stood to lose money to their counterparties.
As alleged in court filings, from about May 2006 to at least January 2011, the four defendants, a Yen LIBOR submitter at LBG, and others agreed to make false and fraudulent Yen LIBOR submissions for the benefit of selected trading positions. According to the allegations, sometimes Robson submitted rates at a specific level requested by a co-defendant or other traders, and at other times Robson made a higher or lower Yen LIBOR submission consistent with the direction requested by a co-defendant or other traders.
For example, according to court filings, on Sept. 21, 2007, Yagami asked Robson by email, “where do you think today’s libors are? If you can I would like 1mth higher today.” Robson responded, “bookies reckon .85,” to which Yagami replied, “I have some fixings in 1mth so would appreciate if you can put it higher mate.” Robson answered, “no prob mate let me know your level.” After Yagami asked for “0.90% for 1mth,” Robson confirmed, “sure no prob[ ] I’ll probably get a few phone calls but no worries mate… there’s bigger crooks in the market than us guys!”
Robson admitted that he accommodated the requests of his co-defendants and other traders. For example, on Sept. 21, 2007, after Robson allegedly received a request from Yagami for a high one-month Yen LIBOR, Rabobank submitted a one-month Yen LIBOR rate of 0.90, which was seven basis points higher than the previous day and five basis points above where Robson said that “bookies” predicted it, and which moved Rabobank’s submission from the middle to the highest of the panel.
According to court documents, the defendants were also aware that they were making false or fraudulent Yen LIBOR submissions. For example, on May 10, 2006, Robson admitted in an email to Yagami that “it must be pretty embarrasing to set such a low libor. I was very embarrased to set my 6 mth – but wanted to help thomo [Thompson]. Tomorrow it will be more like 33 from me.” At times, Robson referred to the submissions that he submitted on behalf of his co-defendants as “ridiculously high” and “obscenely high,” and acknowledged that his submissions would be so out of line with the other Yen LIBOR panel banks that he might receive a phone call about them from the BBA or Thomson Reuters.
On numerous occasions, Robson also passed along such requests to the LBG submitter, who altered LBG’s Yen LIBOR submission accordingly if doing so did not adversely affect selected trading positions at LBG. Likewise, the LBG setter sent requests to Robson and he generally altered Rabobank’s Yen LIBOR to satisfy the requests. For example, on July 28, 2006, Robson wrote to the LBG submitter: “morning skipper.....will be setting an obscenely high 1m again today...poss 38 just fyi.” The LBG submitter responded: “(K)...oh dear..my poor customers....hehehe!! manual input libors again today then!!!!” Both banks’ submissions on July 28 moved up one basis point, from 0.37 to 0.38. As the LBG submitter explained, according to court documents filed in connection with Rabobank’s deferred prosecution agreement, to other LBG submitters, “We usually try and help each other out…but only if it suits.”
The charges in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
The investigation is being conducted by special agents, forensic accountants, and intelligence analysts in the FBI’s Washington Field Office. The prosecution is being handled by Senior Litigation Counsel Carol L. Sipperly and Trial Attorney Brian R. Young of the Criminal Division’s Fraud Section, and Trial Attorney Michael T. Koenig of the Antitrust Division. The Criminal Division’s Office of International Affairs has provided assistance in this matter.
The Justice Department expresses its appreciation for the assistance provided by various enforcement agencies in the United States and abroad. The Commodity Futures Trading Commission’s Division of Enforcement referred this matter to the department and, along with the U.K. Financial Conduct Authority, has played a major role in the LIBOR investigation. The Securities and Exchange Commission also has played a significant role in the LIBOR series of investigations, and the department expresses its appreciation to the United Kingdom’s Serious Fraud Office for its assistance and ongoing cooperation. The department has worked closely with the Dutch Public Prosecution Service and the Dutch Central Bank in the investigation of Rabobank. Various agencies and enforcement authorities from other nations are also participating in different aspects of the broader investigation relating to LIBOR and other benchmark rates, and the department is grateful for their cooperation and assistance.
This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes. For more information about the task force visit: www.stopfraud.com.Former Patriarch of the Lorenzana Drug Trafficking Organization Pleads Guilty to Drug Conspiracy ChargesRead the Press Release
Waldemar Lorenzana Sr., 75, the patriarch of the Lorenzana drug trafficking organization in Guatemala, pleaded guilty today to conspiracy to import over 450 kilograms of cocaine into the United States.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and Acting Special Agent in Charge Robert W. Patterson of the Drug Enforcement Agency’s (DEA) Special Operations Division made the announcement. The guilty plea was entered by U.S. District Judge Colleen Kollar-Kotelly in the District of Columbia.
“For more than a decade, the Lorenzana drug trafficking operation received, stored, and transported massive quantities of cocaine for distribution in the United States,” said Assistant Attorney General Caldwell. “The kingpin and patriarch of this family has now been extradited and convicted in the United States, and two of his sons are currently awaiting extradition from Guatemala. This case once again affirms the Justice Department’s unwavering commitment to working with our international law enforcement partners to bring transnational drug traffickers, wherever they may reside, to justice for their crimes.”
“For years, members of the Lorenzana family smuggled cocaine to the United States with impunity,” said Acting Special Agent in Charge Patterson. “The indictment, extradition and conviction of Waldemar Lorenzana, and the pending extradition of other members of his family, proves once again that no one is above the law when international partners cooperate. This investigation could never have been brought to fruition without the unwavering support of our law enforcement colleagues and is another great example of international coordination.”
According to the superseding indictment, from March 1996 to April 2009, Lorenzana Sr. and three of his sons conspired to distribute multi-ton quantities of cocaine within Guatemala and elsewhere, knowing that the narcotics would be illegally imported into the United States for distribution. As described in further court documents, the Lorenzana drug trafficking organization worked with drug trafficking organizations in Colombia and Mexico to transport shipments of cocaine by go-fast boats and airplanes to El Salvador and Guatemala for distribution to cities within the United States. Lorenzana Sr. was arrested by Guatemalan authorities on April 26, 2011, detained in Guatemala, and extradited to the United States in March 2014. Sentencing will be scheduled at a later date.
The charges contained in an indictment are merely accusations, and a defendant is presumed innocent unless and until proven guilty.
The investigation was led by the DEA’s 959/Bilateral Investigations Unit and Guatemala City Country Office and was part of the Organized Crime Drug Enforcement Task Force. The case is being prosecuted by Trial Attorneys Amanda Liskamm, Adrian Rosales and Michael Lang of the Criminal Division’s Narcotic and Dangerous Drug Section. The Criminal Division’s Office of International Affairs provided significant assistance in the extradition. The Department expresses its gratitude and appreciation to the government of Guatemala for its assistance in this matter.Drug Trafficker Sentenced to 17.5 Years in PrisonRead the Press Release
PHOENIX – On Aug. 18, 2014, Luis Enrique Villegas-Lugo, 40, of Culiacan, Sinaloa, Mexico was sentenced by Senior U.S. District Judge Roslyn O. Silverto 17.5 years in prison. Villegas-Lugo pleaded guilty on Feb. 25, 2014 to conspiracy to possess with intent to distribute 500 grams or more of methamphetamine, a felony.
The Organized Crime Drug Enforcement Task Force investigation into the Villegas-Lugo Drug Trafficking Organization (DTO) took place from July 2006 through September 2006 in Phoenix. On Feb. 25, 2009, the defendant was charged with conspiring to possess with the intent to distribute methamphetamine, possessing methamphetamine, and possessing firearms in furtherance of the drug trafficking business. The evidence showed that the DTO imported methamphetamine from Mexico into the United States and transported it to a stash house in Phoenix. Once there, the methamphetamine was distributed to customers. During the investigation, law enforcement agents seized approximately 20 pounds of methamphetamine, two handguns, two rifles, and drug packaging materials from the stash house.
The investigation in this case was conducted by the Drug Enforcement Administration, the Phoenix Police Department, the Maricopa County Sheriff’s Office, and the Surprise Police Department. The prosecution was handled by Jonell L. Lucca, Assistant U.S. Attorney, District of Arizona, Phoenix.
CASE NUMBER: CR-09-00210-001-PHX-ROS
RELEASE NUMBER: 2014-046_Villegas-LugoFor 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.Drug Courier Found in Fresno County with over 8 Pounds of Heroin SentencedRead the Press Release
FRESNO, Calif. —Ana Lilia Angulo, aka Ana Lilia Ochoa Angulo, 30, of San Jose, was sentenced today to three years and five months in prison, to be followed by five years of supervised release, for conspiring to distribute and to possess with intent to distribute 8.8 pounds of heroin, United States Attorney Benjamin B. Wagner announced.
According to court documents, Fresno County sheriff detectives stopped Angulo for a traffic violation while she was driving a vehicle northbound on Interstate 5. During the stop, the detectives found several packages of heroin weighing 8.8 pounds behind the arm rest panel of the rear passenger seat near where Angulo’s infant child was sitting in a car seat. The heroin had a wholesale value of approximately $88,000 to $96,000. Angulo admitted that she was paid $2,500 per trip to transport the drug and that she was on her third trip.
This case was the product of an investigation by the U.S. Drug Enforcement Administration and the Fresno County Sheriff’s Office. Assistant United States Attorney Karen Escobar prosecuted the case.
Detroit Man to Serve More Than Five Years for Heroin PossessionRead the Press Release
Huntington, W.Va. – Alton Tribble, 37, of Detroit, Michigan was sentenced in federal court in Huntington today to five years and three months’ in federal prison. Tribble previously pled guilty in April of 2014 to possession with intent to distribute heroin. On December 26, 2013, members of the Huntington Police Department searched a residence at 917 21st Street in Huntington used by Tribble to store heroin he intended to sell in the Huntington area. Police seized heroin, a .32 caliber semi-automatic pistol, and a set of digital scales.
This case is being prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and heroin. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
Defendants Sentenced in Mortgage Fraud SchemeRead the Press Release
DALLAS — Four Dallas-area individuals, along with a defendant from Georgia, who were convicted for their roles in a mortgage fraud scheme that caused more than $3 million in losses to lenders, have been sentenced, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
On Friday, August 15, Jarrod Jamiel Williams, 35, most recently of McKinney, Texas, was sentenced by U.S. District Judge Barbara M. G. Lynn to 87 months in federal prison and ordered to pay approximately $3.6 million in restitution. He pleaded guilty in January 2014 to one count of conspiracy to commit wire fraud affecting a financial institution.
Williams has been in custody since June 2012 on charges stemming from a foreclosure-rescue scheme that was prosecuted in the Eastern District of Texas and for which he was sentenced to 57 months imprisonment. Judge Lynn ordered that 27 months of Williams’s sentence in the Dallas case would run concurrently with the Eastern District of Texas sentence with the remaining 60 months to run consecutively. It total, between the two different fraud schemes, Williams will serve 117 months in federal custody and was ordered to pay more than $5 million in restitution.
Other defendants convicted and sentenced for their role in the scheme include Christopher Davis Allen, 42, and his ex-wife, Cheryl Renee Allen, 51, who were each sentenced in June 2014 to 42 months in federal prison and ordered to pay approximately $3.6 million in restitution. Arzonda Murchison, 43, was sentenced in March 2014 to 36 months in federal prison and ordered to pay approximately $2.8 million in restitution. Aaron Robert Martell, of Georgia, was sentenced in May 2014 to 21 months in federal prison and ordered to pay approximately $1.3 million in restitution. Each pleaded guilty to one count of conspiracy to commit wire fraud affecting a financial institution.
From March 2006 to at least February 2008, Williams, a real estate investor who owned Jade Capital Group, along with escrow officers/loan processors/notaries Christopher and Cheryl Allen, title company owner, Murchison, and recruiter, Martell, engaged in the fraud scheme by facilitating fraudulent property transactions to obtain mortgage loans for residential real estate properties.
Part of the defendants’ scheme involved submitting false and fraudulent statements on loan applications and other closing documents to obtain proceeds from the transactions and making more false statements and material omissions regarding the disbursement of monies.
Williams recruited, or caused others to recruit, straw buyers to purchase the properties, knowing the purchasers buying the properties could not quality for the loans without making false statements on loan applications and other closing documents. Williams also knew that payments were made to straw buyers outside of closing.
As an example of the mortgage fraud scheme, Williams and Martel recruited an individual to purchase a residential property located on Dartmouth Avenue in Highland Park, Texas, knowing that the individual could not qualify for the necessary loans without making false statements concerning income, assets and intention to occupy the property. Williams referred the individual to Cheryl Allen who prepared the fraudulent loan applications. Chris Allen notarized the documents and assisted in the closing of the transaction, which occurred at Viewpoint Title, a company owned and operated by Murchison. Not only were the loan applications false, the closing documents falsely represented that the borrower made a $270,000 down payment when, in fact, that money was supplied by Williams. In addition, Williams, along with coconspirators, created a fraudulent check that purported to show the down payment coming directly from the borrower. At closing, Williams received more than $800,000 from Viewpoint Title as proceeds from the transaction, which were disbursed among the coconspirators. Because of the false statements on the documents, the lender approved two interstate wire transfers of approximately $2.1 million and $270,000 to fund the mortgage for the individual.
This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes. For more information about the task force visit: www.stopfraud.gov
The FBI investigated the case. The FBI and the U.S. Attorney’s Office received assistance from the Texas Appraiser Licensing and Certification Board in connection with the investigation. Assistant U.S. Attorney J. Nicholas Bunch prosecuted.
Dallas Man Sentenced to Serve 25 Years in Federal Prison on Drug Trafficking and Money Laundering ConvictionsRead the Press Release
DALLAS — A Dallas man who pleaded guilty to felony offenses stemming from his role as a major participant in a marijuana distribution conspiracy operating in north Texas was sentenced this morning in federal court in Dallas, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas
Andres Hernandez, Jr., a/k/a “Gordo,” 34, was sentenced by U.S. District Judge Sam A. Lindsay to serve a total of 300 months in federal prison. Hernandez pleaded guilty in September 2013 to one count of conspiracy to distribute 100 kilograms or more of marijuana and one count of money laundering. Judge Lindsay sentenced him to 25 years on the drug conspiracy conviction and 10 years on the money laundering conviction, to run concurrently.
Hernandez and others were arrested on November 1, 2012, following a law enforcement operation led by the Drug Enforcement Administration (DEA) and the North Texas High Intensity Drug Trafficking Area (HIDTA) task force, during which federal search warrants were executed at various locations, including Hernandez’s residence on W. Colorado Blvd. in Dallas. At his residence, law enforcement located approximately 20 pounds of marijuana, digital scales and a loaded firearm. Hernandez has remained in custody since his arrest.
According to documents filed in the case, Hernandez admitted that on multiple occasions between January 2011 and the date of his arrest, he received multi-pound quantities of marijuana from several supply sources, including co-defendants Serviano Contreras, a/k/a “Seven” and “Junior,” 27, and Virgilio Espinosa Delacruz, a/k/a “Chaparro,” 41. Hernandez admitted that he stored this marijuana both at his residence and at the residence of co-defendant Benicio Pena, Jr., a/k/a “Nene,” 63, on Lourdes Street in Dallas. Contreras, Delacruz and Pena pleaded guilty to their respective roles in the conspiracy and are serving federal prison sentences of 48 months, 44 months, and 42 months, respectively.
Hernandez admitted that he routinely distributed multi-pound quantities of marijuana to co-defendants Jarvis Holmes, 43; Claudia Castillo, 21; Jerry Cardenas, 32; Lamont Morgan, 35; Roberto Lopez Delacruz, 27; and Paul Santoy, 28. They each pleaded guilty to their roles in the conspiracy. Holmes was sentenced to 51 months; Cardenas, 48 months; Morgan, 46 months; Roberto Delacruz, 16 months; and Santoy, 15 months. Claudio Castillo is scheduled to be sentenced on November 17, 2014.
Hernandez further admitted that in March 2012, an individual purchased a parcel of land located in Barry, Texas, using $28,854 in cash provided by Andres Hernandez’s wife, Griselda Hernandez, 34. That same day, that individual deeded the property to Andres and Griselda Hernandez. Andres Hernandez admitted that the cash used to purchase the property included drug proceeds. Griselda Hernandez also pleaded guilty to her role in the conspiracy and was sentenced to 57 months in federal prison.
The DEA, North Texas HIDTA and Internal Revenue Service Criminal Investigation investigated. Assistant U.S. Attorney Phelesa Guy was in charge of the prosecution.
Confessed Heroin Dealers SentencedRead the Press Release
DALLAS — Two confessed heroin dealers were sentenced this morning in federal court in Dallas, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
Misael Perla, a/k/a “Irving” and “Weasal,” 26, of Dallas, was sentenced by U.S. District Judge David C. Godbey to 300 months in federal prison. Perla pleaded guilty in January 2014 to two counts of possession of heroin with intent to distribute, the use of which caused the death of victims Alexandra Julia Moreno, 20, of Irving, Texas, in July 2012, and Cassidy Seward, 18, of Grapevine, Texas, in August 2012.
Hugo Sanchez, a/k/a “Juice,” 25, also of Dallas, was sentenced by Judge Godbey to an aggregate sentence of 360 months in federal prison. Sanchez pleaded guilty in April 2014 to seven counts of a superseding indictment including: one count of conspiracy to possess with intent to distribute a controlled substance; possession of heroin with intent to distribute and distribution to a person under age 21; possession of cocaine with intent to distribute; possession of heroin with intent to distribute; possession of methamphetamine with intent to distribute; possession of a firearm by a prohibited person and possession of a firearm in furtherance of a drug-trafficking offense. Although Sanchez did not admit his role in providing the narcotics that resulted in several overdose deaths, the Court heard evidence that Sanchez provided narcotics that were responsible for at least three known overdose deaths in 2011 and 2012.
“Often drug users are seen as victims of their own choices. Today, however, in federal court, two drug dealers who preyed upon those addictions, faced the families who have been forever harmed because of their actions,” said U.S. Attorney Saldaña. “While we cannot replace the young lives that were lost to heroin and other dangerous drugs, this office will continue to hold those accountable who make those poisons available in our communities.”
According to documents filed in the case, Perla admitted that on July 16, 2013, he knowingly distributed heroin to Ms. Moreno, a woman he had recently met at a club. Perla provided the heroin to Ms. Moreno while she was staying with him at his mother’s home and he watched as she used the heroin in his presence. Later that evening and into the next morning, Perla attempted to wake Ms. Moreno, and he became concerned that she may have overdosed. He put her into the bed of a truck, drove to Baylor Medical Center at Irving and left her body with medical personnel at the emergency room. Ms. Moreno was pronounced dead shortly after her arrival at the hospital, and a subsequent autopsy report concluded that she “died as the result of the toxic effects of heroin.”
Perla also admitted in the factual resume that he had a relationship with Cassidy Seward, to whom he knowingly supplied heroin. After returning home one morning in August 2012, Ms. Seward used heroin provided by Perla and methamphetamine from Sanchez. After her family found her unresponsive, paramedics arrived and transported Ms. Seward to the hospital, where she was soon pronounced dead. A subsequent autopsy report concluded that she died from the “mixed drug toxicity” of heroin and methamphetamine.
According to documents filed in the case, Hugo Sanchez admitted to possessing heroin, cocaine, and methamphetamine with the intent to further distribute, as well as possessing numerous firearms in furtherance of his drug-trafficking activities. Additional documents filed in the case tied Sanchez’s narcotics to the 2011 and 2012 overdose deaths of Robert Nugent II, Henry Wiley II, and Solina Marin, all residents of the DFW Metroplex.
The Irving Police Department and the Grapevine Police Department led the investigation, with assistance from U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI).
Assistant U.S. Attorney Jason Schall prosecuted.
Clinton Woman Sentenced in $2.3 Million Government Contract Fraud SchemeRead the Press Release
Greenbelt, Maryland – U.S. District Judge Paul W. Grimm sentenced Larayne Whitehead, age 35, of Clinton, Maryland, today to 18 months in prison followed by five years of supervised release for conspiring to commit wire fraud in connection with a scheme to defraud businesses which supplied goods under government contracts. Judge Grimm also entered an order that Whitehead forfeit and pay restitution of $2,361,042.11 and a car.The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation.
According to her plea agreement, from December 2007 to May 2013, Whitehead and her co-conspirators used at least 15 businesses in Maryland, Delaware, Georgia, Nevada, North Carolina and Tennessee which they incorporated to bid on contracts to provide goods – such as books, snowmobiles, plants and paint – to government agencies. Most of the contracts were awarded using an online marketplace to compete for federal contracts. The conspirators often submitted extremely low bids to secure the contracts. Once awarded the contracts, Whitehead enticed victim businesses to supply the goods required by contract and promised to pay these subcontractors after the government paid Whitehead. Whitehead, however, fraudulently retained the government payments for her own personal benefit and did not pay the subcontractors.
The conspirators typically operated under a particular business name for six to 12 months until the business was either disqualified from the online marketplace or was otherwise burdened with lawsuits or liens. The conspirators then continued the scheme under a newly-registered business name.
As a result of the scheme, Whitehead and co-conspirator Christopher Johnson received at least 144 bank deposits from governmental agencies totaling approximately $2,321,058.95 which was reasonably foreseeable to Whitehead. The scheme involved between 50 and 250 business victims.
In addition, on June 28, July 16 and August 10, 2010, Whitehead submitted duplicate charges to a government credit card that the Department of Homeland Security had provided to her to pay for goods provided pursuant to a government contract. The resulting loss to the federal government was $39,983.16.
Christopher Johnson, age 36, of Clinton, Maryland previously pleaded guilty to his participation in the scheme. Johnson was sentenced on July 21, 2014 to 18 months in prison and ordered to pay restitution of $426,376.99.
The National Procurement Fraud Task Force was formed in October 2006 to promote the early detection, identification, prevention and prosecution of procurement fraud associated with the increase in government contracting activity for national security and other government programs. The Procurement Fraud Task Force includes the United States Attorneys= Offices, the FBI, the U.S. Inspectors General community and a number of other federal law enforcement agencies. This case, as well as other cases brought by members of the Task Force, demonstrate the Department of Justice’s commitment to helping ensure the integrity of the government procurement process.
United States Attorney Rod J. Rosenstein praised the FBI for its work in the investigation and thanked Assistant U.S. Attorney Bryan E. Foreman, who prosecuted the case.Clinton Woman Sentenced in $2.3 Million Government Contract Fraud SchemeRead the Press Release
Greenbelt, Maryland – U.S. District Judge Paul W. Grimm sentenced Larayne Whitehead, age 35, of Clinton, Maryland, today to 18 months in prison followed by three years of supervised release for conspiring to commit wire fraud in connection with a scheme to defraud businesses which supplied goods under government contracts. Judge Williams also entered an order that Whitehead forfeit $2,393,579 and a car.The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation.
According to her plea agreement, from December 2007 to May 2013, Whitehead and her co-conspirators used at least 15 businesses in Maryland, Delaware, Georgia, Nevada, North Carolina and Tennessee which they incorporated to bid on contracts to provide goods – such as books, snowmobiles, plants and paint – to government agencies. Most of the contracts were awarded using an online marketplace to compete for federal contracts. The conspirators often submitted extremely low bids to secure the contracts. Once awarded the contracts, Whitehead enticed victim businesses to supply the goods required by contract and promised to pay these subcontractors after the government paid Whitehead. Whitehead, however, fraudulently retained the government payments for her own personal benefit and did not pay the subcontractors.
The conspirators typically operated under a particular business name for six to 12 months until the business was either disqualified from the online marketplace or was otherwise burdened with lawsuits or liens. The conspirators then continued the scheme under a newly-registered business name.
As a result of the scheme, Whitehead and co-conspirator Christopher Johnson received at least 144 bank deposits from governmental agencies totaling approximately $2,321,058.95 which was reasonably foreseeable to Whitehead. The scheme involved between 50 and 250 business victims.
In addition, on June 28, July 16 and August 10, 2010, Whitehead submitted duplicate charges to a government credit card that the Department of Homeland Security had provided to her to pay for goods provided pursuant to a government contract. The resulting loss to the federal government was $39,983.16.
Christopher Johnson, age 36, of Clinton, Maryland previously pleaded guilty to his participation in the scheme. Johnson was sentenced on July 21, 2014 to 18 months in prison and ordered to pay restitution of $426,376.99.
The National Procurement Fraud Task Force was formed in October 2006 to promote the early detection, identification, prevention and prosecution of procurement fraud associated with the increase in government contracting activity for national security and other government programs. The Procurement Fraud Task Force - chaired by Assistant Attorney General for the Criminal Division Lanny A. Breuer - includes the United States Attorneys’ Offices, the FBI, the U.S. Inspectors General community and a number of other federal law enforcement agencies. This case, as well as other cases brought by members of the Task Force, demonstrate the Department of Justice=s commitment to helping ensure the integrity of the government procurement process.United States Attorney Rod J. Rosenstein praised the FBI for its work in the investigation and thanked Assistant U.S. Attorney Bryan E. Foreman, who prosecuted the case.
Cherry Creek Man Charged with Possession of Sawed-Off Shotgun and Assault with A Dangerous WeaponRead the Press Release
United States Attorney Brendan V. Johnson announced that a Cherry Creek, South Dakota, man has been indicted by a federal grand jury for Possession of a Sawed-Off Shotgun and Assault with a Dangerous Weapon.
Kelly Joe Romero, age 26, was indicted on July 17, 2013. He appeared before U.S. Magistrate Judge Mark A. Moreno on July 30, 2014, and pled not guilty to the Indictment.
The maximum penalty upon conviction is 10 years in custody and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
Romero is alleged to have pulled and pointed a sawed-off shotgun at the victim in Cherry Creek in May of 2013.
The charges are merely accusations and Romero is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Cheyenne River Sioux Tribe Law Enforcement Services and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney Mikal Hanson is prosecuting the case.
Romero was remanded to the custody of the U.S. Marshals Service. Trial has not been set.
Chemical Firm Admits to Violating Clean Air Act by Failing to Develop and Implement Risk Storage Plan at Former Pawtucket FacilityRead the Press Release
PROVIDENCE, R.I. – Roberts Chemical Company, Inc. pleaded guilty in federal court in Providence today to violating the Clean Air Act by failing to develop and implement a Risk Management Plan to minimize the chance of release of ethyl ether from its former Pawtucket, R.I., facility, and to protect workers, the community and emergency and first responders in the event of a release or fire involving ethyl ether. Environmental Protection Agency (EPA) regulations require a company’s Risk Management Plan include a “worst case” response plan.
Roberts Chemical Company, Inc., now located in Attleboro, Mass., is in the business of storing, distributing and repackaging chemicals, some of which are designated as extremely hazardous.
Ethyl ether is a volatile, extremely flammable liquid chemical. EPA regulations require facilities storing more than 10,000 lbs. of ethyl ether to develop and implement a Risk Management Plan. An investigation by EPA determined that in November and December 2008, Roberts Chemical Company, Inc. failed to develop and implement a Risk Management Plan while storing 27,467 lbs. of ethyl ether at their former facility at 258 Pine Street in Pawtucket.
The guilty plea was announced by the United States Attorney’s Office in Rhode Island and the Environmental Protection Agency Criminal Investigation Division Boston Area Office.
A sentencing hearing before U.S. District Court Judge John J. McConnell, Jr. has not been scheduled. A plea agreement filed with the court stipulates that at sentencing the Government and Roberts Chemical Company, Inc. will recommend the court impose a fine of $200,000. In addition, according to the plea agreement, Roberts Chemical Company, Inc. is required to issue a public apology.
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[email protected]Cedar Rapids Man Pleads Guilty to Producing and Selling Counterfeit DVDs and CDsRead the Press Release
A man who produced and had for sale thousands of counterfeit movie DVDs and music CDs pled guilty today in federal court in Cedar Rapids.
Steven Brown, 45, from Cedar Rapids, Iowa, was convicted of one count of copyright infringement.
At the plea hearing, Brown admitted that between December 2012 and February 2013, he produced and offered for sale 1,510 counterfeit DVDs and 492 counterfeit CDs. Brown further admitted that these counterfeit goods had a total retail value of more than $25,000.
Sentencing before United States District Court Chief Judge Linda R. Reade will be set after a presentence report is prepared. Brown remains free on conditions of supervision set by the Court pending sentencing. Brown faces a possible maximum sentence of five years’ imprisonment, a $250,000 fine, $100 in special assessments, and three years of supervised release following any imprisonment.
The case is being prosecuted by Assistant United States Attorney Anthony Morfitt and was investigated by the Department of Homeland Security.
Court file information is available at https://ecf.iand.uscourts.gov/. The case file number is 14-CR-00080.
Carondelet Health Network to Pay $35 Million to Resolve False Claims Allegations Involving St. Joseph’s and St. Mary’s Hospitals in TucsonRead the Press Release
TUCSON, Ariz. – Carondelet Health Network, an Arizona non-profit corporation doing business as Carondelet St. Mary’s Hospital and Carondelet St. Joseph’s Hospital in Tucson, Ariz., has agreed to pay the United States $35,000,000 to resolve civil allegations that the hospitals violated the federal False Claims Act by submitting false bills to Medicare and other federal health care programs.
“This settlement is the largest-ever False Claims Act recovery in Arizona, and it reflects the longstanding and ongoing efforts of our office to guard the vital but limited funding of federal health care programs,” said United States Attorney John S. Leonardo. “Inpatient rehabilitation services are very costly to taxpayers, and it is critical that these federal dollars be reserved only for those qualified patients who need the intense rehabilitation therapy services provided in an inpatient setting.”“This settlement shows OIG’s hard work to safeguard the taxpayer dollars,” said Glenn R. Ferry, Special Agent in Charge for the Los Angeles Region of the United States Department of Health and Human Services, Office of Inspector General. “Health care fraud victimizes both patients and the American taxpayers, and we are dedicated to investigating and prosecuting these types of activities.”
The settlement agreement resolves allegations that from April 7, 2004, through Dec. 31, 2011, Carondelet St. Mary’s Hospital and Carondelet St. Joseph’s Hospital billed Medicare, the Federal Employees Health Benefit Program, and the Arizona Health Care Cost Containment System (Arizona’s Medicaid agency) for inpatient rehabilitation facility services that were not properly reimbursable under applicable coverage criteria because the patients were not appropriate for inpatient rehabilitation facility services. The United States alleged that as a result of these false claims, federal health care programs paid substantially more than was warranted.
Shortly before becoming aware of the United States’ investigation, Carondelet disclosed to the government some inpatient rehabilitation overpayments and tendered a substantial repayment. However, based on its investigation, the United States had concerns about the nature of Carondelet’s disclosure, including concerns that the disclosure and the repayment Carondelet tendered were not timely, complete, or adequate. Despite these concerns, the United States considered Carondelet’s efforts in this regard as one of several factors in reaching the settlement amount and the resolution of the case. The settlement is neither an admission of liability by the hospitals, nor is it a concession by the United States that its claims are not well founded.
The settlement resolves a lawsuit filed in November 2011 by Jacqueline Bloink under the qui tam, or whistleblower, provisions of the False Claims Act, which allow private citizens to bring civil actions on behalf of the United States and share in any recovery obtained. The case was filed in the United States District Court for the District of Arizona and is captioned United States ex rel. Bloink v. Carondelet Health Network, et al., (CV-11-721-TUC-FRZ). Ms. Bloink will receive a share of the settlement payment that resolves the qui tam suit she filed.
The case was investigated by the United States Attorney’s Office for the District of Arizona; the United States Department of Health and Human Services, Office of Inspector General; and the United States Office of Personnel Management, Office of Inspector General.
Individuals with information regarding fraud, waste, or abuse related to Medicare or other federal programs are encouraged to file a complaint with the United States Attorney’s Office through the office’s website, http://www.justice.gov/usao/az/, or by calling (602) 514-7500.
Attachment: Carondelet Settlement Agreement (PDF)
RELEASE NUMBER: 2014-047_Carondelet
For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/