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23 September 2014
Reading Man Pleads Guilty to Participating in Monroe County-Based Heroin ConspiracyRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a 57-year-old Reading, Pennsylvania man pleaded guilty today before U.S. District Court Judge Robert D. Mariani to participating in a heroin trafficking conspiracy.
According to United States Attorney Peter Smith, the defendant, Richard Carvajal, admitted to conspiring with others in Monroe County, Berks County, and elsewhere in 2012 and 2013, to distribute and possess with intent to distribute heroin.
Carvajal was originally indicted by a federal grand jury in June 2013, and subsequently charged in a superseding indictment in March 2014. The charge against Carvajal resulted from an investigation by the Drug Enforcement Administration, U.S. Immigration and Customs (ICE) Homeland Security Investigations (HSI), the Pennsylvania State Police, the Pennsylvania Attorney General’s Office, and Berks County Detectives.
Carvajal faces a potential maximum sentence of 20 years in prison and a $1 million fine. Sentencing was scheduled for January 2015.
The case is being prosecuted by Assistant U.S. Attorney Francis P. Sempa.
Portland Man Sentenced to Four Years for Transporting Women Interstate for ProstitutionRead the Press Release
Contact: Gail Fisk Malone
Assistant United States Attorney
Tel: (207) 945-0373Portland, Maine: United States Attorney Thomas E. Delahanty II announced that Samuel
Gravely, 28, of Portland, Maine, was sentenced today in U.S. District Court by Judge Nancy
Torresen to four years in prison and three years of supervised release for interstate transportation of three women for prostitution. On November 20, 2013, Gravely pleaded guilty plea to the charge.According to the indictment and trial evidence, on March 27, 2013, Gravely and co- defendant, Fritz Blanchard, caused a 20-year-old Presque Isle woman and a 17-year-old Portland minor to work as prostitutes at a Portland hotel, advertising their services on backpage.com. On
March 28, Gravely and Blanchard drove the two women, and a 19-year-old Portland woman, from Portland to Boston intending that the three work as prostitutes there. When they arrived in
Boston, Blanchard took two of the women to a downtown street and told them how to attract customers and engage in prostitution.Blanchard was convicted of aiding and abetting interstate transportation for prostitution after a four-day jury trial that ended on August 28, 2014. He awaits sentencing.
The case was investigated by U.S. Immigration and Customs Enforcement’s Homeland
Security Investigations, with assistance from the Boston Police Department; the Federal Bureau of Investigation; the Portland, Presque Isle, Old Town, Brunswick and Saco Police Departments; the Maine Drug Enforcement Agency; and Cumberland County Sheriff’s Office.Plymouth County Man Sentenced to Prison for Methamphetamine ConvictionRead the Press Release
A man who conspired to distribute methamphetamine was sentenced September 11, 2014, to more than eleven years in federal prison.
Jason Moore, 30, from LeMars, Iowa, received the prison term after an April 25, 2014, guilty plea to conspiring to distribute methamphetamine.
At the guilty plea, Moore admitted his involvement in a conspiracy from about June of 2012 through March 2013, that distributed more than 500 grams of actual (pure) methamphetamine. During the time period of the conspiracy, Moore lived in Northwest Iowa and sold methamphetamine to various customers in Northwest and Central Iowa. Moore traveled to Des Moines, Iowa one or two times a week to obtain methamphetamine for resale in Central and Northwest Iowa.
Moore was sentenced in Sioux City by United States District Court Judge Donald E. O’Brien. Moore was sentenced to 162 months with credit for 19 months previously served for a current sentence of 143 months’ imprisonment. A special assessment of $100 was imposed. He must also serve a 5-year term of supervised release after the prison term. There is no parole in the federal system.
Moore is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Shawn S. Wehde and investigated by the Clay County Sheriff’s Office, who was assisted by the Iowa Great Lakes Drug Task Force, Iowa Division of Narcotics Enforcement, Spirit Lake Police Department, Le Mars Police Department, Hawarden Police Department, O’Brien County Sheriff’s Office, Sheldon Police Department, and the Central Iowa Drug Task Force.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 13-4039.
Owner of Tax Preparation Business Pleads Guilty to Tax FraudRead the Press Release
Filed 283 False Tax Returns, Resulting in the IRS Paying Almost $1 Million in Refunds
Baltimore, Maryland – Jennifer Rodriguez, age 40, of Hyattsville, Maryland pleaded guilty today to conspiring to defraud the United States in connection with the filing of 291 false tax returns.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Thomas J. Kelly of the Internal Revenue Service - Criminal Investigation, Washington, D.C. Field Office.“Identity thieves are becoming more creative and conniving,” stated Thomas J. Kelly, Special Agent in Charge, IRS Criminal Investigation, Washington, D.C. Field Office. “They steal identities, steal from the U.S. taxpayer and prey upon innocent victims.”
According to her plea agreement, Rodriguez owned a tax preparation service known as Latin Multi Services, located in Silver Spring, Maryland. From October or November 2010 to January 2012, Rodriguez filed false income tax returns using the stolen identities of Puerto Rico residents. The stolen identities were obtained from a co-conspirator residing in Puerto Rico who appeared to group the stolen identities by families, including minor children. Rodriguez falsely listed the tax payers’ home addresses as her own home address in Maryland, or variations of her business address. These tax returns also included fabricated income and deductions. All of the fraudulent returns requested refunds to be deposited in bank accounts that Rodriguez or a co-conspirator controlled.Over the course of the scheme, Rodriguez filed 283 false tax returns which caused IRS to pay $983,382 in fraudulent refunds.
Rodriguez faces a maximum sentence of 10 years in prison. U.S. District Judge J. Frederick Motz scheduled sentencing for January 12, 2015 at 9:30 a.m.
United States Attorney Rod J. Rosenstein praised the IRS – Criminal Investigation for its work in the investigation and thanked Assistant U.S. Attorney Bryan E. Foreman, who is prosecuting the case.Orchard Park Motel Owners Sentenced for Immigration OffensesRead the Press Release
BUFFALO, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that Mahesh Ambu, 54, and his wife, Jyotiben Ambu, 53, both natives of Tanzania with British citizenship who currently reside in Orchard Park, NY, were sentenced by U.S. District Court Judge Elizabeth A. Wolford for their convictions on immigration charges.
Mahesh Ambu, who was convicted of unlawfully attempting to procure naturalization, was sentenced to time served and one year supervised release. Jyotiben Ambu, who was convicted of entering the United States by means of concealing a material fact, was also sentenced to time served.
Assistant U.S. Attorney John E. Rogowski, who is handling the case, stated that the defendants, who own and operate the Orchard Park Inn in Orchard Park, applied for naturalization in 2008. On their application, both defendants falsely claimed that they had never lied to immigration officers in the past to gain immigration benefits. Both defendants did in fact lie on their 2003 visa applications, claiming that they had not previously resided in the United States or been issued Social Security numbers.
An investigation by Immigration and Customs Enforcement determined that between 1995 and 2003, the defendants illegally resided in Oklahoma, Georgia, Florida, and New York, prior to filling out their visa applications in 2003 and were issued Social Security numbers in 1996. In fact, the defendants purchased the Orchard Park Inn in 2001, prior to their visa applications. As a result of their pleas, both defendants are subject to possible removal proceedings by the Department of Homeland Security.
The sentencing is the culmination of an investigation on the part of Special Agents of Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent in Charge James C. Spero.One Year After Launching Key Sentencing Reforms, Attorney General Holder Announces First Drop in Federal Prison Population in More Than Three DecadesRead the Press Release
In a speech at the Brennan Center for Justice, Attorney General Eric Holder announced today that the federal prison population has dropped by roughly 4,800 inmates since September 2013. This represents the first time the federal inmate population has fallen, rather than risen, over the course of a fiscal year since 1980.
Moreover, Attorney General Holder announced that current Bureau of Prisons estimates project this downward trend to continue in each of the next two fiscal years. In FY15, the inmate population is projected to drop by another 2,200 inmates. In FY16, the population is projected to drop by 10,000 inmates - or the equivalent of six federal prisons.
“This is nothing less than historic,” said Attorney General Holder. “Clearly, criminal justice reform is an idea whose time has come. And thanks to a robust and growing national consensus – a consensus driven not by political ideology, but by the promising work that’s underway – we are bringing about a paradigm shift, and witnessing a historic sea change, in the way our nation approaches these issues.”
While these statistics show progress at the federal level, there is similar progress at the state level. Overall, incarceration rates have fallen by roughly 10 percent since President Obama took office, and that has occurred simultaneously with a similarly-sized reduction in crime rates.
The Attorney General’s full remarks to the law enforcement conference, as prepared for delivery appear below:
Thank you, Jim [Johnson], for those kind words; for your friendship over the many years we’ve known one another – since we served together in the Clinton Administration; and for your leadership, along with Doug Jones, as co-chair of the Brennan Center’s Blue Ribbon Panel.
I’d also like to thank the Brennan Center’s distinguished president, my friend Michael Waldman, and your entire staff – particularly the Justice Program – for bringing us together today. It’s an honor to take part in this important conference. It’s a privilege to be at NYU Law School for the second time in as many weeks. And it’s a great pleasure, as always, to be back home in New York City.
For nearly two decades, the Brennan Center has provided indispensable leadership on issues ranging from campaign finance and voting rights to national security and equal justice. You’ve offered rigorous research and expert guidance to policymakers at every level of government. And with this conference – and the report you’re unveiling today – you’re taking yet another step to advance our efforts to address some of our nation’s most critical challenges – few of which are more complex, or more urgent, than the need to strengthen America’s criminal justice system and reduce our overreliance on incarceration.
As you know, we gather this afternoon just over a year after the launch of the Justice Department’s Smart on Crime initiative – a series of important changes and commonsense reforms I set in motion last August. Already, these changes are fundamentally shifting our response to certain crime challenges – particularly low-level, nonviolent drug offenses. And this initiative is predicated on the notion that our work as prosecutors must be informed, and our criminal justice system continually improved, by the most effective and efficient strategies available.
After all – as I’ve often said – the United States will never be able to prosecute or incarcerate its way to becoming a safer nation. We must never, and we will never, stop being vigilant against crime – and the conditions and choices that breed it. But, for far too long – under well-intentioned policies designed to be “tough” on criminals – our system has perpetuated a destructive cycle of poverty, criminality, and incarceration that has trapped countless people and weakened entire communities – particularly communities of color.
In recent decades, the effects of these policies – and the impact of the “truth-in-sentencing” mindset – have been dramatic. Although the United States comprises just five percent of the world’s population, we incarcerate almost a quarter of its prisoners. The entire United States population has increased by about a third since 1980. But the federal prison population has grown by almost 800 percent over the same period. Spending on corrections, incarceration, and law enforcement has exploded, consuming $260 billion per year nationwide. And the Bureau of Prisons currently commands about a third of the Justice Department’s overall budget.
Perhaps most troubling is the fact that this astonishing rise in incarceration – and the escalating costs it has imposed on our country, in terms both economic and human – have not measurably benefited our society. We can all be proud of the progress that’s been made at reducing the crime rate over the past two decades – thanks to the tireless work of prosecutors and the bravery of law enforcement officials across America. But statistics have shown – and all of us have seen – that high incarceration rates and longer-than-necessary prison terms have not played a significant role in materially improving public safety, reducing crime, or strengthening communities.
In fact, the opposite is often true. Two weeks ago, the Washington Post reported that new analysis of crime data and incarceration rates – performed by the Pew Charitable Trusts, and covering the period of 1994 to 2012 – shows that states with the most significant drops in crime also saw reductions in their prison populations. States that took drastic steps to reduce their prison populations – in many cases by percentages well into the double digits – saw crime go down as well. And the one state – West Virginia – with the greatest increase in its incarceration rate actually experienced an uptick in crime.
As the Post makes clear: “To the extent that there is any trend here, it’s actually that states incarcerating people have seen smaller decreases in crime.” And this has been borne out at the national level, as well.
Since President Obama took office, both overall crime and overall incarceration have decreased by approximately 10 percent. This is the first time these two critical markers have declined together in more than 40 years. And although we have a great deal of work to do – and although, last year, some states continued to record growth in their prison populations – this is a signal achievement.
We know that over-incarceration crushes opportunity. We know it prevents people, and entire communities, from getting on the right track. And we’ve seen that – as more and more government leaders have gradually come to recognize – at a fundamental level, it challenges our commitment to the cause of justice.
Fortunately, I can report today that we are finally moving in the right direction, at least at the federal level. Over the past year, the federal prison population declined by roughly 4,800 inmates – the first decrease we’ve seen in many decades.
Even more promising are new internal projections from the Bureau of Prisons. In a dramatic reversal of prior reports – which showed that the prison population would continue to grow, becoming more and more costly, overcrowded, and unsafe – taking into account our new policies and trends, our new projections anticipate that the number of federal inmates will fall by just over 2,000 in the next 12 months – and by almost 10,000 in the year after.
This is nothing less than historic. To put these numbers in perspective, 10,000 inmates is the rough equivalent of the combined populations of six federal prisons, each filled to capacity. Now, these projected decreases won’t result in any prison closures, because our system is operating at about 30 percent above capacity. But my hope is that we’re witnessing the start of a trend that will only accelerate as our Smart on Crime changes take full effect.
Clearly, criminal justice reform is an idea whose time has come. And thanks to a robust and growing national consensus – a consensus driven not by political ideology, but by the promising work that’s underway, and the efforts of leaders like Senators Patrick Leahy, Dick Durbin, Mike Lee, and Rand Paul – we are bringing about a paradigm shift, and witnessing a historic sea change, in the way our nation approaches these issues.
Of course, for these changes to become permanent, we’ll need to rely on the dedication – and the leadership – of federal prosecutors in Washington and in all 94 of our United States Attorney’s Offices. As a career prosecutor myself – and as former U.S. Attorney for the District of Columbia – I have always had the utmost confidence in, and respect for, these hardworking men and women. And that’s why, as Attorney General, I’ve consistently advocated policies that push discretion out into the field.
The Smart on Crime initiative is in many ways the ultimate expression of my trust in the abilities – and the judgment – of our attorneys on the front lines. And although some have suggested that recent changes in charging and sentencing policies might somehow undermine their ability to induce cooperation from defendants in certain cases, today, I want to make it abundantly clear that nothing could be further from the truth.
As I know from experience – and as all veteran prosecutors and defense attorneys surely recognize – defendant cooperation depends on the certainty of swift and fair punishment, not on the length of a mandatory minimum sentence. Like anyone old enough to remember the era before sentencing guidelines existed and mandatory minimums took full effect, I can testify to the fact that federal guidelines attempted to systematize the kinds of negotiations that were naturally taking place anyway. As our U.S. Attorney for the Western District of Wisconsin, John Vaudreuil, often reminds his colleagues, even without the threat of mandatory minimums, it remains in the interests of all attorneys to serve as sound advocates for their clients – and for defendants to cooperate with the government in exchange for reduced sentences.
Far from impeding the work of our prosecutors, the sentencing reforms I’ve mandated have strengthened their discretion. The contention that cooperation is somehow dependent on mandatory minimums is tied to a past at tension with the empirical present, and is plainly inconsistent with history, and with now known facts. After all, as the Heritage Foundation observed earlier this year: “[t]he rate of cooperation in cases involving mandatory minimums is comparable to the average rate in all federal cases.”
Of course, as we refine our approach and reject the ineffective practice of calling for stringent sentences against those convicted of low-level, nonviolent crimes, we also need to refine the metrics we use to measure success; to evaluate the steps we’re taking; and to assess the effectiveness of new criminal justice priorities. In the Smart on Crime era, it’s no longer adequate – or appropriate – to rely on outdated models that prize only enforcement, as quantified by numbers of prosecutions, convictions, and lengthy sentences, rather than taking a holistic view.
As the Brennan Center and many others have recognized – and as your landmark report on Federal Prosecution for the 21st Century makes crystal clear – it’s time to shift away from old metrics and embrace a more contemporary, and more comprehensive, view of what constitutes success. This means developing a new system of assessment – because, as you’ve noted, what gets measured is what gets funded and what gets funded is what gets done. That’s why I want to commend this organization – and each of our Blue Ribbon Panelists, including some of our very best sitting and former U.S. Attorneys – for examining new ways for the Justice Department to leverage our resources to better serve America’s communities.
Your concrete recommendations – that federal prosecutors should prioritize reducing violence, incarceration, and recidivism – are consistent with the aims of the Smart on Crime initiative. The new metrics you propose – such as evaluating progress by assessing changes in local violent crime rates, numbers of federal prisoners initially found in particular districts, and changes in the three-year recidivism rate – lay out a promising roadmap for us to consider. And my pledge to you today is that my colleagues and I will not merely carefully study this critical report – we will use it as a basis for discussion, and a vital resource to draw upon, as we engage in a far-reaching process to develop and codify new success measures – with the aim of cementing recent shifts in law and policy.
One of the key points underscored by your report – and emphasized under the Smart on Crime approach – is the need for the Justice Department to direct funding to help move the criminal justice field toward a fuller embrace of science and data. This is something that we – and especially our Office of Justice Programs and Bureau of Justice Assistance – have taken very seriously throughout the Obama Administration. And nowhere are these ideals more fully embodied – or more promisingly realized – than in our Justice Reinvestment Act and Second Chance Act programs.
As we speak, the states that participate in Justice Reinvestment are making fundamental policy reforms that aim to reduce unnecessary confinement, save taxpayer dollars, and reinvest funding in strategies proven to enhance community safety. A report issued in January highlighted 17 states that are projected to save $4.6 billion over 10 years. Another study, in June, highlighted seven states that have achieved substantial reductions in three-year recidivism rates. And these successes are notable not only for their magnitude, but for the political consensus that drove them.
Thanks to bipartisan support from Congress, funding for the Justice Reinvestment Initiative has more than quadrupled this year. That, on its own, is an extraordinary indication of the power and importance of this work. And this additional funding is allowing us to launch a new challenge grant program – designed to incentivize states to take the next major step in their reform efforts.
Today, I am pleased to announce that five states – Delaware, Georgia, Louisiana, Ohio, and Oregon – will be receiving these grants, which can be used to expand pre-trial reforms, to scale up swift and certain sanctions, to institute evidence-based parole practices, or a number of other options. I am also pleased to announce that five states have been selected to receive new funding under the Second Chance Act to help reduce recidivism. Georgia, Illinois, Iowa, Minnesota, and Vermont will each be awarded $1 million to meet their recidivism reduction goals. And each will be eligible for an additional $2 million over the next two years if they do so.
In addition to these and other Second Chance awards, our Office of Juvenile Justice and Delinquency Prevention is providing $7 million in Second Chance Act funding to support reentry demonstration programs and other important efforts at the juvenile level. A further $1.8 million will support a new Juvenile Reentry Legal Assistance Program through our partners at the Department of Housing and Urban Development. And we’ll soon be launching a broader partnership with HUD – a partnership rooted in the Pay for Success model championed by the Brennan Center – to focus on finding permanent supportive housing for those returning from incarceration.
The Justice Department has transferred $5 million to HUD for this program, which will announce the competition in the coming months. Together, these exciting efforts reaffirm our commitment to strengthening America’s justice system at every level. They underscore our determination to help people get back on the right path. But they’re only the beginning – because, beyond our Smart on Crime reforms and our emphasis on evidence-based practices, I believe the federal government has an even broader and more critical role to play in securing the fundamental promise of equal justice under law.
As we saw all too clearly last month – as the eyes of the nation turned to events in Ferguson, Missouri – whenever discord, mistrust, and roiling tensions fester just under the surface, interactions between law enforcement and local residents can quickly escalate into confrontation, unrest, and even violence. These tensions simmer every day in far too many communities across the country. And it’s incumbent upon all of America’s law enforcement officers and leaders to work with the communities they serve to defuse these charged situations by forging close bonds, establishing deep trust, and fostering robust engagement.
The situation in Ferguson has presented leaders across the nation, and criminal justice and civil rights leaders in particular, with a moment of decision – and a series of important questions that can no longer be avoided. Will we allow this time – our time – to be defined by division and discord? Or will we summon the resolve, the fortitude, and the vision to reassess – and even to remake – our system, through cooperation, consensus, and compassion?
Will we again turn a blind eye to the hard truths that Ferguson exposed, burying these tough realities until another tragedy arises to set them off like a powder keg? Or will we finally accept this mandate for open and honest dialogue, reach for new and innovative solutions, and rise to the historic challenge – and the critical opportunity – now right before us?
These questions are not rhetorical. And as we seek to address them, we must take into account the preconceived notions that certain people may bring to interactions with police – preconceptions that may be informed by generations of experience; by the totality of what it has meant to be a person of color in the United States. We must consider corresponding notions that police may bring to interactions with certain communities and individuals. And we must never lose sight of the immense and unyielding difficulties inherent in the law enforcement profession – from the training they receive to the risks these brave men and women incur every time they put on their uniforms; from the dangers they face, and the split-second decisions they often must make, to the anguish of family members who awaken at night to the sound of a ringing telephone – hoping for the best, but fearing tragic news about a loved one out walking the beat.
As the brother of a retired law enforcement officer, I understand well how challenging – and how thankless – their vital work can be. As our nation’s Attorney General, I will always be proud – and steadfast – in my support for law enforcement personnel and their families, who make tremendous and often unheralded sacrifices every single day to keep us safe. And as an African-American man – who has been stopped and searched by police in situations where such action was not warranted – I also carry with me an understanding of the mistrust that some citizens harbor for those who wear the badge.
So today, it’s time to ask ourselves – as a nation – are we conducting policing, in the 21st century, in a manner that is as effective, as efficient, as equitable, and as just as is possible? It’s time to build on the outstanding leadership that so many local police are providing – and the reform efforts that are underway in St. Louis County and elsewhere – by making this work a focused, national priority.
Just last week, the Justice Department launched a substantial effort to do just that – by establishing a National Initiative for Building Community Trust and Justice to promote credibility, to enhance procedural justice, to reduce implicit bias, and to support racial reconciliation. Separately, President Obama has directed federal agencies to carefully review programs that may provide military equipment, or funding for military equipment, to local police – a process that remains ongoing. Through a range of other programs like the President’s My Brother’s Keeper initiative – and the department’s regular interactions with exemplary law enforcement executives across the country – my colleagues and I are doing important work to resolve tensions and promote mutual understanding; to bridge divides and spark constructive dialogue; and to ensure – above all else – that everyone who comes into contact with the police is treated fairly.
This is important, and in some cases life-changing, work. But I believe we need to take these efforts even further. That’s why, under the leadership of our COPS Office, the Justice Department is working with major police associations to conduct a broad review of policing tactics, techniques, and training – so we can help the field swiftly confront emerging threats, better address persistent challenges, and thoroughly examine the latest tools and technologies to enhance the safety, and the effectiveness, of law enforcement. Going forward, I will support not only continuing this timely review, but expanding it – to consider the profession in a comprehensive way – and to provide strong, national direction on a scale not seen since President Lyndon Johnson’s Commission on Law Enforcement nearly half a century ago.
In this ongoing effort, and in so many others – as we seize this important moment, renew our determination to combat crime, and accept the historic opportunities now before us – my colleagues and I will continue to look to the Brennan Center, and each of the leaders in this audience, for guidance; for edification; and for frank and honest advice. We will continue to rely on the experience, and the thoughtful consideration, that you have brought to today’s discussion – and to countless others over the past two decades. And we will always be both proud and humbled to count you as partners, and as essential allies, in the considerable work ahead.
I want to thank you all – once again – for your leadership, your vision, and your unwavering commitment to the mission we share. I look forward to building on this dialogue in the weeks and months to come. And I am optimistic – despite the challenges we face, and the obstacles we must confront – about where your efforts will take us, and all that we will achieve – together – for the exceptional nation we all love.
Thank you.
Northeastern Pennsylvania Man Pleads Guilty to $1.8 Million Investment FraudRead the Press Release
A former Bartonsville man has pleaded guilty in federal court to a charge stemming from an investment fraud, United States Attorney for the Middle District of Pennsylvania Peter J. Smith announced Tuesday.
Joseph Gallardo, 48, Bartonsville, pleaded guilty to mail fraud before Senior U.S. District Court Judge Sylvia H. Rambo on Tuesday. According to documents filed with the Court, Gallardo was a registered investment advisor with investment firms in New Jersey and Pennsylvania. He persuaded clients with those investment firms to invest in Blue Meadow Group LLL, his personal real estate venture. Victims were guaranteed attractive rates of return and were falsely told that their money was invested in and protected by real estate. Contrary to what was represented to the victims, Blue Meadow Group was not a real estate investment trust and its securities were not registered with the Pennsylvania and New Jersey Securities Commissions.
In fact, victims’ monies were used to purchase a gas station and convenience store and to fund Gallardo’s on-line day trading account that lost a substantial amount of money.
During July 2009, the Pennsylvania Securities Commission issued a cease and desist order ordering Gallardo to stop offering or selling investment properties in Pennsylvania. After the cease and desist order, Gallardo solicited additional victims who invested money with him.
Investigators have determined that victims of Gallardo’s criminal activity lost approximately $1.8 million.
The case was investigated by the United States Postal Inspection Service. It is assigned to Assistant U.S. Attorney Christy H. Fawcett.
New Jersey Transit Employee Admits Extorting Money from VendorsRead the Press Release
NEWARK, N.J. – A New Jersey Transit employee admitted today to obtaining money from New Jersey Transit vendors to use his official authority and influence to help them get work with New Jersey Transit, U.S. Attorney Paul J. Fishman announced.
William Talerico, 55, of Beachwood, New Jersey, pleaded guilty to an information charging one count of affecting commerce by extortion under color of official right. Talerico entered his guilty plea before U.S. District Judge William H. Walls in Newark federal court.
According to documents in this case and statements made in court:
From at least around January 2006 to April 2012, Talerico served as a supervisor of stations responsible for overseeing the maintenance and custodial functions for certain New Jersey Transit facilities, including stations on New Jersey Transit’s North Jersey Coast Line and Northeast Corridor.
During this time period, Talerico agreed to accept and accepted corrupt payments in cash from numerous New Jersey Transit vendors. In exchange, Talerico agreed to, and did, exercise official authority and influence to assist the New Jersey Transit vendors with securing work from New Jersey Transit. In addition, Talerico acted as an intermediary through which corrupt payments were given to a New Jersey Transit supervisor. Talerico received more than $70,000, for himself and the supervisor, in corrupt payments of cash and other items of value from these New Jersey Transit vendors.
The extortion charge to which Talerico pleaded guilty carries a maximum potential penalty of 20 years in prison and a $250,000 fine. Talerico is scheduled to be sentenced on Jan. 6, 2015.
U.S. Attorney Fishman thanked the New Jersey Attorney General’s Office, under the direction of Acting Attorney General John Hoffman and Elie Honig, Director of the New Jersey Division of Criminal Justice, for their work in this investigation.
U.S. Attorney Fishman credited special agents of the Federal Bureau of Investigation, under the direction of Special Agent in Charge Aaron T. Ford; and the New Jersey State Police, under the direction of Colonel Joseph R. Fuentes, Superintendent of the New Jersey State Police, for their work in the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorneys Amy Luria and Maureen Nakly of the U.S. Attorney’s Office Special Prosecutions Division in Newark, and Special Assistant U.S. Attorney Michael A. Monahan, the Chief of the Financial and Computer Crimes Bureau, Division of Criminal Justice, in the New Jersey Attorney General’s Office.
14-339
Defense counsel: Peter R. Willis Esq., Jersey City, New Jersey
Talerico, William Information
Nevada Sex Offender Sentenced to 15 Years for Child PornRead the Press Release
Project Safe Childhood
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Nevada, Mo., man who is a registered sex offender was sentenced in federal court today for receiving and distributing child pornography over the Internet.
David Lee Knowles, 56, of Nevada, was sentenced by U.S. District Judge M. Douglas Harpool to 15 years in federal prison without parole. The court also ordered Knowles to forfeit to the government an iPad2, a desktop computer, an iPhone and an external hard drive, all of which were used to commit the offense.
Knowles, a registered sex offender as a result of his 1997 conviction for sexual assault, pleaded guilty on April 1, 2014. Knowles admitted that he received and distributed child pornography between May 31, 2012, and Jan. 3, 2013.
A law enforcement officer was conducting an undercover investigation into the distribution of child pornography with peer-to-peer, file-sharing networks. Knowles’s computer was identified as sharing videos of child pornography over the Internet.
This case was prosecuted by Assistant U.S. Attorney Patrick Carney. It was investigated by the FBI and the Joplin, Mo., Police Department.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."Neenah Man Sentenced to Federal PrisonRead the Press Release
United States Attorney James L. Santelle, of the Eastern District of Wisconsin, announced that on September 22, 2014, Charles Kniebes-Larsen (age: 34) of Neenah, Wisconsin, was sentenced to 36 months in federal prison by Chief United States District Judge William C. Griesbach. Kniebes-Larsen previously entered a guilty plea to a single-count indictment charging him with being a felon in possession of a firearm.
The case was investigated by the Lake Winnebago Area Metropolitan Enforcement Group and the Town of Menasha Police Department. The case was prosecuted by Assistant United States Attorney Daniel R. Humble.
Montgomery County Woman Sentenced for Conspiring to Commit Four Armed RobberiesRead the Press Release
Baltimore, Maryland – U.S. District Judge Richard D. Bennett sentenced Marvel Alegria, age 24, of Gaithersburg, Maryland, today to 57 months in prison followed by three years of supervised release for conspiring to commit armed robbery in connection with four robberies of Chipotle restaurants. Judge Bennett also ordered Alegria to pay restitution of $24,900.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge William P. McMullan of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; Colonel Marcus L. Brown, Superintendent of the Maryland State Police; Washington County Sheriff Douglas W. Mullendore; Chief J. Thomas Manger of the Montgomery County Police Department; Carroll County State’s Attorney Jerry Barnes; Washington County State’s Attorney Charles P. Strong; and Montgomery County State’s Attorney John McCarthy.According to her plea agreement, Alegria was a general manager at the Chipotle restaurant in Mt. Airy, Maryland until July 17, 2012 when she was fired for violating company policies. She became upset about her termination, and began discussing robbing the Chipotle restaurant with co-defendant Lamont Bonds, with whom she was having a relationship. Alegria advised Bonds of the best time to commit the robbery, and how to access the store and its safe which contained money.
On July 22, 2012, Bonds and Alegria recruited co-defendant Norman Guifarro to participate in the robbery. That evening, Bonds and Guifarro entered the restaurant wearing masks Bonds had made from tee shirts. Bonds, armed with a shotgun, forced the manager into the office at gunpoint and obtained the money from the safe, while Guifarro, armed with a knife, held the other employees on the floor. Bonds and Guifarro stole $5,000 in cash and fled after forcing the employees into a bathroom. Bonds and Guifarro divided the stolen money among themselves and Alegria.
On August 4, October 21 and November 25, 2012, Bonds, armed with what appeared to be a black semi-automatic pistol, robbed Chipotle restaurants in Hagerstown, Gaithersburg and Damascus, Maryland, respectively, using similar methods as in the first robbery. In the August 4th robbery, Bonds and another man stole $9,400 from the safe. Alegria drove Bonds to and from the Gaithersburg and Damascus robberies where Bonds stole $7,000 and $3,500, respectively. In each robbery, Bonds forced the manager to open the safe at gunpoint.
Lamont Bonds, age 26, of Gaithersburg, Maryland, previously pleaded guilty to his role in the conspiracy and is scheduled to be sentenced on November 24, 2014 at 11:00 a.m. Norman Guifarro was convicted in Carroll County Circuit Court of the Mt. Airy robbery and was sentenced to seven years in prison.
United States Attorney Rod J. Rosenstein commended the ATF, Maryland State Police, Montgomery County Police Department, Washington County Sheriff’s Office and the Montgomery, Washington and Carroll County State’s Attorney’s Offices for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorney A. David Copperthite, who prosecuted the case.
Methamphetamine and Cocaine Dealer Sentenced to 240 Months in Federal PrisonRead the Press Release
Spokane – Today, Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that Gregorio Figueroa-Ochoa, age 45, of Outlook, Washington, was sentenced today after being convicted of conspiracy to possess with intent to distribute methamphetamine and cocaine. United States District Court Judge Thomas O. Rice sentenced Figueroa-Ochoa to a 240 month term of imprisonment, to be followed by a five year term of court supervision following release from Federal prison.
Law enforcement agents executed search warrants at several residences affiliated with Figueroa-Ochoa on August 15, 2013. That day agents seized over 25 pounds of methamphetamine, over 10 pounds of heroin, and several firearms. Defendant pled guilty on June 11, 2014 to conspiracy to possess with intent to distribute methamphetamine and cocaine.
Michael C. Ormsby said, “This case involved drug trafficking at the highest levels in the Eastern District of Washington, as reflected by the amount of drugs and firearms seized and by the sentence meted out by the judge. This case is yet another example of the cooperative investigative efforts among state and federal law enforcement law enforcement agencies in the Eastern District of Washington.”
This investigation was conducted by the Drug Enforcement Administration, Homeland Security Investigations, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Yakima County Sheriff’s Office. This case was prosecuted by Benjamin D. Seal, an Assistant United States Attorney for the Eastern District of Washington.
Meridian Man Sentenced for Possession of DrugsRead the Press Release
Hattiesburg, Miss – Joseph Brown, 38, of Meridian, Mississippi, was sentenced by U.S. District Judge Keith Starrett to 78 months in federal prison followed by five years of supervised release for possession of narcotics, United States Attorney Gregory K. Davis announced today. Brown was also ordered to pay a $10,000 fine and forfeit a Norinco 7.62.39mm SKS rifle.
The case was investigated by the Lamar County Sheriff’s Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. It was prosecuted by Assistant United States Attorney Annette Williams.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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Medina Man Faces Heroin ChargesRead the Press Release
A Medina mas was indicted for possession with intent to distribute heroin, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Curtis DeBose, 34, possessed the heroin on August 7, 2014, according to the indictment.
Debose was arrested by members of the Medina County Drug Task Force and Drug Enforcement Administration on a criminal complaint after an nvestigation.
If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
The investigation preceding the indictment was conducted by the Medina County Drug Task Force, Medina Police Department and the Drug Enforcement Administration. The matter is being prosecuted by Assistant United States Attorney Teresa Riley.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Maryville Woman Charged in Murder-for-hire SchemeRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today a Maryville, Mo., woman has been charged in federal court in a murder-for-hire scheme in which she negotiated with an undercover federal agent and, without realizing it, her intended victim.
Kristina M. Swinford, 32, of Maryville, was charged in a criminal complaint filed in the U.S. District Court in Kansas City, Mo., on Monday, Sept. 22, 2014. Swinford was arrested on Friday, Sept. 19, 2014, and remains in federal custody pending a detention hearing on Thursday, Sept. 25, 2014.
The federal criminal complaint charges Swinford with contacting two individuals to kill the wife of her ex-boyfriend. Her intended victim is identified in court documents as “AM.”
According to an affidavit filed in support of the criminal complaint, Swinford met three times with an undercover agent with the Bureau of Alcohol, Tobacco, Firearms and Explosives to negotiate the murder-for-hire. Following her third meeting with the ATF agent, the affidavit says, Swinford also negotiated via Facebook with another person, without realizing that she was actually communicating with her intended victim, who had created an online profile under another person’s name.
On Aug. 25, 2014, a cooperating source in Taylor County, Iowa, reported to law enforcement authorities about traveling to Maryville and having a discussion with Swinford. According to the affidavit, Swinford complained about AM and made it clear she wanted AM kidnapped, killed or gone. AM had gone through a brief separation from her husband, the affidavit says, and during that time he was involved in a relationship with Swinford. AM and her husband had been granted ex parte orders of protection in an effort to keep Swinford from stalking or harassing them.
The cooperating source was instructed to meet with Swinford again and provide her with the contact information of an undercover ATF agent if she still wanted someone to kill AM. The undercover agent contacted Swinford on Aug. 28, 2014, and arranged to meet.
Swinford allegedly met with the undercover agent on three separate occasions, each time sitting in a vehicle in a Wal-Mart parking lot in Bethany, Mo., and discussed several scenarios for killing AM. Swinford allegedly agreed to pay $10,000 prior to AM being killed and another $10,000 afterward. She provided the undercover agent with a photo of AM, a map of her house and other information, the affidavit says. Swinford allegedly paid the undercover agent $150 for his expenses. At the third meeting on Sept. 10, 2014, the affidavit says, the undercover agent told Swinford he could pick up AM after she dropped her kids off at school, then kill her and cut off her hands and head and toss them into the river to make it look like Mexican drug dealers. Swinford allegedly agreed with this plan and the undercover agent told her to get a hold of him when she got the money.
On Sept. 19, 2014, AM reported to local law enforcement authorities that Swinford had been discussing AM’s murder on Facebook. According to the affidavit, AM had created a false Facebook account for a real person she knows, who is identified in the affidavit as WB. AM told authorities she created the account because her husband had blocked his Facebook account so she could not view her husband’s Facebook page.
AM reported that on Sept. 18, 2014, she had logged in to delete the fake account but found a message from Swinford from Aug. 9, 2014, addressed to whom Swinford clearly thought was the real WB. AM used the false Facebook account to engage Swinford in a lengthy conversation. During the conversation, the affidavit says, Swinford expressed her dislike for AM. According to AM, further in the conversation, she and Swinford discussed WB (the real person but fake Facebook account) harming her (AM).
AM told police that she was terrified and had no way of knowing if Swinford had spoken to anyone else about having her hurt or murdered. ATF agents had not notified AM or her husband that ATF had been conducting the investigation into Swinford hiring the undercover agent.
Dickinson cautioned that the charge contained in this complaint is simply an accusation, and not evidence of guilt. Evidence supporting the charge must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Alison Dunning. It was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Maryville, Mo., Department of Public Safety.
Marysville Man Sentenced to over 14 Years in Prison and Tehama Man Pleads GuiltyRead the Press Release
SACRAMENTO, Calif. — John Franklin Bye, 45, of Marysville, was sentenced Tuesday by United States District Judge John A. Mendez to 14 years and seven months in prison for distribution of child pornography, United States Attorney Benjamin B. Wagner announced.
According to court documents, in 2013, the Nevada County Sheriff’s Office received a tip from the National Center for Missing and Exploited Children (NCMEC) that Bye had been trading images of child pornography through email. Law enforcement obtained a state search warrant for the contents of Bye’s emails and found multiple attachments of minors engaged in sexually explicit conduct.
This case was the product of an investigation by the FBI and the Sacramento Internet Crimes Against Children (ICAC) Task Force, a federally and state-funded task force managed by the Sacramento Sheriff’s Department with agents from federal, state, and local agencies. The Sacramento ICAC investigates online child exploitation crimes, including child pornography, enticement, and sex trafficking.
Tehama Man Pleads Guilty
Robert Anthony Bonnot, 54, of Gerber, pleaded guilty Tuesday to production of child pornography. According to court documents, in 2010, on at least six separate occasions, Bonnot produced child pornography of a minor child and broadcast it through his web camera to New Zealand. In January 2011, New Zealand officials notified the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) that videos of Bonnot’s activities had been discovered. A forensic examination of his computer identified 426 images and five videos of child pornography. An additional 172 images of child pornography were found on a CD created by Bonnot.
Bonnot has been in custody in the Sacramento County Jail since March 2011. He is scheduled to be sentenced by United States District Judge John A. Mendez on January 20, 2015. Bonnot faces a statutory penalty of 15 to 30 years in prison and a $250,000 fine. The actual sentence, however, will 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.
This case is the product of an investigation by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). Assistant United States Attorney Kyle Reardon prosecuted both cases.
These cases were 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.
Luzerne County Man Sentenced to Prison for Drug Delivery Resulting in DeathRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a West Pittston man was sentenced yesterday in Scranton by U.S. District Court Judge Malachy E. Mannion to 135 months in federal prison for his role in a drug distribution conspiracy.
According to United States Attorney Peter Smith, Todd Morgans, age 35, pled guilty to conspiring with others between December 2012 and July 2013 to distribute alpha-pyrrolidinopentiophenone (A-PVP), an analogue of methylenedioxypyrovalerone (MDPV). A-PVP is a synthetic cathinone which is included in a family of abused drugs commonly known as “bath salts.”
"HSI will use all resources at its disposal to prevent the importation and distribution of dangerous chemical substances that cause harm to our local communities. Yesterday's sentencing represents the effort of law enforcement agencies working together to make our neighborhoods safer” said U.S. Immigration and Customs (ICE) Homeland Security Investigations (HSI) Philadelphia Special Agent in Charge John Kelleghan.
A controlled substance analogue is a drug which has not been scheduled under The Controlled Substances Act but has a similar chemical structure and a similar stimulant or hallucinogenic effect on a person’s central nervous system. Such controlled substance analogues are treated as if the substance were the scheduled drug for prosecution and sentencing purposes.
The U.S. Attorney’s Office noted that the sentence included an enhancement applicable when the death or serious bodily injury of another results from the use of the controlled substance. While the investigation surrounding the death of Jason Folweiler remains ongoing, Morgans, in his plea agreement with the government, publicly acknowledged that he delivered drugs to Folweiler and apologized to his family.
Morgans also forfeited an automobile, the contents of his bank account, $40,000 in currency seized from his home and a silver bar.
This investigation was conducted by the U.S. Immigration and Customs (ICE) Homeland Security Investigations (HSI), the Pennsylvania State Police and the West Pittston Police Department and is being prosecuted by Assistant United States Attorney Amy C. Phillips.
Louisville Man Charge for Child Pornography ViolationsRead the Press Release
Ian A. Leach, 26, of Louisville, Ohio, was charged with receiving, distributing and possessing visual depictions of minors engaged in sexually explicit conduct, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment charges that from on or about May 27, 2014, through on or about July 13, 2014, Leach knowingly received and distributed in interstate and foreign commerce, by computer, numerous computer files, which files contained visual depictions of real minors engaged in sexually explicit conduct.
The indictment also charges that on September 4, 2014, Leach possessed a computer that contained child pornography.
If convicted, the sentence in this case will be determined by the court after consideration of the federal sentencing guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant United States Attorney Michael A. Sullivan. The case was investigated by the Canton Office of the Federal Bureau of Investigation and the Canton Police Department.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Local Man Pleads Guilty to Running $8.7 Million Ponzi SchemeRead the Press Release
CINCINNATI – John R. Bullar, 52, of Cincinnati, Ohio, pleaded guilty to one count of wire fraud and to one count of money laundering relative to a fraudulent investment scheme that he ran for 10 years. Bullar faces a maximum of 20 years in prison and a fine of up to $250,000.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, Kathy A. Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation, Cincinnati Field Office, Ohio Attorney General Mike DeWine, Commissioner Andrea Seidt, Ohio Department of Commerce, Division of Securities and Joseph T. Deters, Hamilton County Prosecuting Attorney announced the guilty plea entered before U.S. District Judge Michael R. Barrett.
According to court documents, between 2003 and September 2013 Bullar devised a scheme to defraud investors by soliciting millions of dollars under false pretenses, failing to invest investors' funds as promised, and misappropriating and converting investors' funds for his own benefit without the knowledge or authorization of the investors.
Bullar was the sole owner and operator of Executive Management Advisors, LLC ("EMA"), which had its principal place of business in Cincinnati, Ohio. Bullar also was the sole owner and operator of Priapus Group, LLC. Since at least 1998, Bullar offered investment opportunities to investors through his company, EMA. Bullar marketed himself as someone experienced in the financial services industry and who was successful in investing in commodity futures.
In an effort to persuade individuals to invest with him, Bullar frequently made numerous false representations. For example, Bullar told potential clients that he never had a losing quarter. Bullar also offered potential investors a false sense of security by telling potential investors that he, himself, was the biggest investor in EMA. Bullar told the investors that he would manage their funds even though it was below his minimum level of investment.
The majority of Bullar’s investors were friends, family members and fellow church members. Bullar told his clients that he had invested their money in precious metals, gold, silver, bonds, and foreign currency and that he made money based on the volatility of the market, regardless of whether the market was up or down. Bullar told clients that he preferred to keep the number of his investor’s small, so that he could "fly under the radar." Bullar also told clients that he had a computerized algorithm system that monitored the market for patterns and alerted him to potential losses. Bullar told investors that although he had been offered millions of dollars for the system he would not sell it, because he could make more money using the system rather than selling it. These representations were false, however, because in reality, Bullar had invested only a small amount of the money that he received from clients, using the vast majority of the money to pay other investors and his own personal expenses.
To induce current clients to keep investing, Bullar provided investors with quarterly statements purporting to show their account balances. These statements often showed substantial gains over a short period of time.
Although Bullar collected over $8.7 million from investors between mid-2006 and September 2013, only $580,500.00 was sent to brokers for trading. The remaining $8.1 million was never invested at all. The small fraction of investor money that Bullar actually sent to brokers for trading failed to generate profits and the money was either lost via trading or later withdrawn by Bullar.
In addition, investors actually paid taxes on the fictitious earnings. Bullar caused Forms 1099 to be issued to investors for tax purposes, which reported the fictitious gains. Investors relied on these documents to file their tax returns and investors paid taxes on the fictitious gains reported to them.
Bullar furthered his scheme by creating an appearance of legitimacy. Bullar created an investment blog for his clients (www.emafutures.com), which he updated regularly, sharing various articles and reports about the market. Bullar outfitted his home office, which investors frequented, with a television and three computer monitors to give investors the impression that he was constantly monitoring the market. Bullar’s expansive 5 bedroom/5 bathroom home also gave investors the impression that he was a successful trading advisor. In addition, Bullar also purchased an adjoining lot with investor money and used investor money to remodel the cabin on the lot, install a swimming pool and outdoor kitchen, and pay for professional landscaping on the lot. Bullar also entertained groups of investors at his home, treating investors to lavish dinners and paying for some investors to vacation with him.
In addition, Bullar used investor money to pay for the mortgage on his home, home renovations, vacations, country club dues, boats, jet skis, sports tickets, and vehicles, among other things.
In total, Bullar’s investment scheme involved more than 10 victims but less than 50 victims. The loss amount resulting from Bullar’s investment scheme exceeded $2,500,000 but was less than $7,000,000.
Bullar was released on bond.
“When you knowingly mix deceit and trickery into the financial well-being of individuals, you create a recipe for devastation that could last a lifetime,” said Special Agent in Charge of IRS Criminal Investigation.” said Kathy A. Enstrom, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office.
U.S. Attorney Stewart commended the investigation by the IRS-Criminal Investigation and Ohio Bureau of Criminal Investigation, the coordination of the Hamilton County Prosecutor’s Office, as well as Assistant United States Attorney Emily N. Glatfelter, who is representing the United States in this case. U.S. Attorney Stewart also thanked the U.S. Commodity Futures Trading Commission, which has filed civil charges in a separate action.Life in Prison for Normal Ill. Man for Crack Cocaine and Marijuana Distribution ConspiracyRead the Press Release
Peoria, Ill. – U.S. District Judge Michael M. Mihm today sentenced Richard George Martin, 35, of Normal, Ill., to serve the remainder of his life in prison with no possibility for parole to be served concurrently with his sentence in a McLean county drug case. Martin was also ordered to forfeit more than $120,000 in seized assets. Following today’s court hearing, Martin was remanded to the Illinois Department of Corrections.
A jury convicted Martin in December 2013, for conspiracy to distribute more than five kilograms of cocaine and more than 50 kilograms of marijuana from 1999 to 2011. According to court documents, Martin has at least three prior felony drug convictions in addition to McLean county case number 10-CF-981.This case was prosecuted as a result of "Operation Prairie Eagle," a cooperative investigation targeting distribution of crack cocaine and marijuana in the Bloomington-Normal area. The Organized Crime Drug Enforcement Task Force (OCDETF) investigation was led by the Normal Police Department and the Federal Bureau of Investigation. Assistant U.S. Attorney Greggory R. Walters is prosecuting the defendants charged as a result of the “Prairie Eagle” investigation. Since 2011, “Operation Prairie Eagle” has resulted in the conviction of 22 defendants for conspiracy to distribute and the distribution of controlled substances in the Bloomington-Normal area.
Liberty Reserve Technology Manager Pleads GuiltyRead the Press Release
The former information technology manager of Liberty Reserve, a company that operated one of the world’s most widely used digital currency services and allegedly laundered billions in suspected criminal proceeds, pleaded guilty today in the Southern District of New York in connection with his role in maintaining the company’s technological infrastructure.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Preet Bharara of the Southern District of New York made the announcement.
Maxim Chukharev, 28, of San José, Costa Rica, pleaded guilty today before U.S. District Judge Denise L. Cote to conspiring to operate an illegal unlicensed money transmitting business. Sentencing is scheduled for January 30, 2015.
According to allegations contained in the indictment and statements made in related court proceedings, Liberty Reserve was incorporated in Costa Rica in 2006 and billed itself as the Internet’s “largest payment processor and money transfer system.” Liberty Reserve was created, structured and operated to help users conduct illegal transactions anonymously and launder the proceeds of their crimes, and it emerged as one of the principal money transfer agents used by cybercriminals around the world to distribute, store and launder the proceeds of their illegal activity. Liberty Reserve was used extensively for illegal purposes, functioning as the bank of choice for the criminal underworld because it provided an infrastructure that enabled cybercriminals around the world to conduct anonymous and untraceable financial transactions.
According to court records, before being shut down by the government in May 2013, Liberty Reserve had more than one million users worldwide, including more than 200,000 users in the United States, who conducted approximately 55 million transactions through its system totaling more than $6 billion in funds. These funds encompassed suspected proceeds of credit card fraud, identity theft, investment fraud, computer hacking, child pornography, narcotics trafficking and other crimes.
Chukharev was an associate of Liberty Reserve founder Arthur Budovsky and served as Liberty Reserve’s information technology manager in Costa Rica. In that role, Chukharev was principally responsible, along with co-defendant Mark Marmilev, formerly Liberty Reserve’s chief technology officer, for maintaining Liberty Reserve’s technological infrastructure.
Chukharev, Marmilev and Budovsky were among seven individuals charged in the indictment, which was unsealed on May 28, 2013. Three co-defendants – Marmilev, Vladimir Kats and Azzeddine el Amine – previously pleaded guilty and await sentencing. The indictment also charged Liberty Reserve with conspiracy to commit money laundering and operation of an unlicensed money transmitting business, and the charges remain pending.
The charges contained in the indictment remain pending and are merely accusations. The defendants are presumed innocent unless and until proven guilty.
This case is being investigated by the U.S. Secret Service, the Internal Revenue Service-Criminal Investigation and the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, with assistance from the Secret Service’s New York Electronic Crimes Task Force. The Judicial Investigation Organization in Costa Rica, the National High Tech Crime Unit in the Netherlands, the Financial and Economic Crime Unit of the Spanish National Police, the Cyber Crime Unit at the Swedish National Bureau of Investigation and the Swiss Federal Prosecutor’s Office also provided assistance.
This case is being prosecuted jointly by the Criminal Division’s Asset Forfeiture and Money Laundering Section (AFMLS) and the U.S. Attorney’s Office’s Complex Frauds Unit and Asset Forfeiture Unit in the Southern District of New York, with assistance from the Criminal Division’s Office of International Affairs and Computer Crime and Intellectual Property Section.
Trial Attorney Kevin Mosley of AFMLS and Assistant U.S. Attorneys Serrin Turner, Andrew Goldstein and Christine Magdo of the Southern District of New York are in charge of the prosecution, and Assistant U.S. Attorney Christine Magdo is in charge of the forfeiture aspects of the case.
Liberty Reserve Information Technology Manager Pleads Guilty in Manhattan Federal CourtRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and Leslie R. Caldwell, Assistant Attorney General for the Justice Department’s Criminal Division, announced that MAXIM CHUKHAREV, formerly an information technology manager for Liberty Reserve, pled guilty today in Manhattan federal court to conspiring to operate an unlicensed money transmitting business. CHUKHAREV helped maintain the technological infrastructure for Liberty Reserve, a company that operated one of the world’s most widely used digital currency services. CHUKHAREV was arrested in San Jose, Costa Rica, in May 2013 and pled guilty today before U.S. District Judge Denise L. Cote.
According to allegations contained in the Indictment filed against Liberty Reserve, CHUKHAREV, and six other individual defendants, and statements made in related court proceedings:
Liberty Reserve was incorporated in Costa Rica in 2006 and billed itself as the Internet’s “largest payment processor and money transfer system.” Liberty Reserve was created, structured and operated to help users conduct illegal transactions anonymously and launder the proceeds of their crimes. It emerged as one of the principal money transfer agents used by cybercriminals around the world to distribute, store, and launder the proceeds of their illegal activity. Liberty Reserve was used extensively for illegal purposes, functioning as the bank of choice for the criminal underworld because it provided an infrastructure that enabled cybercriminals around the world to conduct anonymous and untraceable financial transactions.
Before being shut down by the U.S. government in May 2013, Liberty Reserve had more than one million users worldwide, including more than 200,000 users in the United States, who conducted approximately 55 million transactions through its system totaling more than $6 billion in funds. These funds encompassed suspected proceeds of credit card fraud, identity theft, investment fraud, computer hacking, child pornography, narcotics trafficking, and other crimes.
CHUKHAREV was an associate of Liberty Reserve founder Arthur Budovsky and served as Liberty Reserve’s information technology manager in Costa Rica. In that role, CHUKHAREV was responsible, along with co-defendant Mark Marmilev, formerly Liberty Reserve’s Chief Technology Officer, for maintaining Liberty Reserve’s technological infrastructure.
CHUKHAREV, 28, of San Jose, Costa Rica, pled guilty to one count of conspiring to operate an unlicensed money transmitting business, which carries a maximum sentence of five years in prison. He is scheduled to be sentenced by Judge Cote on January 30, 2015 at 10:00 a.m. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Chukharev is among seven individuals charged in the indictment, which was unsealed on May 28, 2013. Three co-defendants – Vladimir Kats, Azzeddine el Amine, and Mark Marmilev – previously pled guilty and await sentencing. The indictment also charged Liberty Reserve with conspiracy to commit money laundering and operation of an unlicensed money transmitting business, and those charges remain pending.
Mr. Bharara praised the outstanding work of the United States Secret Service, the Internal Revenue Service-Criminal Investigation, and the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, which worked together in this case as part of the Global Illicit Financial Team. Mr. Bharara also thanked the United States Secret Service’s New York Electronic Crimes Task Force for its extraordinary assistance with the investigation. Additionally, Mr. Bharara specially thanked all the international law enforcement agencies that assisted in the investigation, in particular, the Judicial Investigation Organization in Costa Rica, the National High Tech Crime Unit in the Netherlands, the Spanish National Police, Financial and Economic Crime Unit, the Cyber Crime Unit at the Swedish National Bureau of Investigation, and the Swiss Federal Prosecutor’s Office.
This case is being prosecuted jointly with the Department of Justice’s Asset Forfeiture and Money Laundering Section (“AFMLS”), which is overseen by Assistant Attorney General Leslie R. Caldwell. Mr. Bharara thanked AFMLS for its partnership and also thanked the Department of Justice’s Office of International Affairs and Computer Crime and Intellectual Property Section for their support.
The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit and Money Laundering and Asset Forfeiture Unit. Assistant United States Attorneys Serrin Turner, Andrew Goldstein, and Christine Magdo of the Southern District of New York and Trial Attorney Kevin Mosley of AFMLS are in charge of the prosecution, and Assistant United States Attorney Christine Magdo is in charge of the forfeiture aspects of the case.
The charges contained in the Indictment against certain of CHUKHAREV’s co-defendants remain pending and are merely accusations. Those defendants are presumed innocent unless and until proven guilty.
U.S. v, Liberty Reserve, et al. Indictment
Lewiston Man Sentenced to Two Years on Firearms ChargeRead the Press Release
Contact: Craig M. Wolff
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced that
Andrew Silva, 30, of Lewiston, was sentenced today in U.S. District Court by Judge Nancy
Torresen to 2 years in prison and 3 years of supervised release for being a felon in possession of a firearm and ammunition. Silva pleaded guilty on May 21, 2014.According to court records, on September 12, 2012, officers from the Lewiston Police
Department responded to a reported domestic incident. When Silva was arrested in connection with the incident, a round of .22 caliber ammunition was found in his pocket. Officers then obtained a search warrant and found a loaded .22 caliber pistol in the living room closet of the apartment in which Silva was arrested. Silva was prohibited from possessing firearms or ammunition because of a prior felony conviction for aggravated assault.The investigation was conducted by the Bureau of Alcohol, Tobacco, Firearms and
Explosives, and the Lewiston Police Department.Law Enforcement Crackdown on Food Stamp FraudRead the Press Release
Eleven individuals were charged and arrested in metro-Detroit today on criminal food stamp fraud, announced U.S. Attorney Barbara L. McQuade.
McQuade was joined in the announcement by Michigan Attorney General Bill Schuette, Special Agent in Charge Anthony Mohatt, U.S. Department of Agriculture, Office of Inspector General; Special Agent in Charge Paul M. Abbate, Federal Bureau of Investigation; Special Agent in Charge Marlon Miller, U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI); and Col. Kriste Kibbey Etue, Michigan State Police. The agencies are working together to combat fraud against the U.S. Department of Agriculture’s Supplemental Nutrition and Assistance Program (SNAP) food stamp program) and the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC).
Today’s announcement comes at the conclusion of a joint federal and state search and arrest warrant operation that investigated retailers in Hamtramck, Warren, and Detroit who were illegally trafficking in food stamps. The charges allege that store owners and employees allowed SNAP and WIC benefit recipients to use their Electronic Benefit Transfer (EBT) cards to exchange their SNAP or WIC benefits for cash. In return, the stores added a surcharge to the recipients’ withdrawal of SNAP and WIC benefits, sometimes in an amount equal to that of the amount of cash benefit received by the recipient. SNAP and WIC benefit funds are transferred electronically directly to bank accounts managed by the retailers. These transactions totaled an estimated $12.5 milliondollars during the investigation.
The following individuals were arrested today and will be appearing in federal court this afternoon:
- Al Amin Supermarket, 11920 Conant, Hamtramck, owner Moklasur Mukul, age 36, of Hamtramck;
- Bengal American Grocery, 9800 Joseph Campau Avenue, Hamtramck, manager Mohamed Ali, age 38, resident of Detroit;
- Deshi Bazar, 12045 Conant Street, Hamtramck, owners Ali Ahmed, age 31, and Nazir Ahmed, age 32, and employee Mustak Ahmed, age 34, all residents of Detroit;
- Maloncho Greens House, 12133 Conant Street, Hamtramck, owner Azizur Ullah, age 37, of Hamtramck, and employees Mohammed Chadek, age 44, Mohammed Miah, age 38, and Mohammed Amin, age 38, residents of Hamtramck;
- New Al-Madeena Grocery, 2220-2222 Caniff Street, Hamtramck, owner Dilshad Chowdhury, age 34, resident of Hamtramck.
- Pay-Less Foods, 11350 Joseph Campau Avenue, Hamtramck, owner Mohamed Ahmed, age 58, resident of Hamtramck;
- Other locations in metro-Detroit were also searched as part of the investigation.
“Taxpayers in Michigan fund food stamp programs to provide food for the needy, not to create a commodity to be traded for profit," McQuade said. "We hope today’s charges will deter other merchants to ensure that food assistance programs are not abused."
"Michigan families are working harder than ever for every tax dollar," said Schuette. "Today's charges should send the message that we will not stand by while tax dollars are being stolen. Enriching yourself at public expense is not only shameful, but compromises the integrity of government and violates the public trust. I would like to thank our state and federal partners for their cooperative efforts to secure justice and fight fraud wherever it is found."
“This investigation and prosecution should send a strong zero-tolerance message to those individuals engaged in the practice of defrauding taxpayer funded WIC and SNAP programs,” said Anthony Mohatt, Special Agent-in-Charge, USDA-Office of Inspector General. “It should also serve as a warning to all stores, that participate in the WIC and SNAP programs as vendors, that fraud and trafficking (purchasing those benefits for cash) will be vigorously investigated and prosecuted by the USDA-OIG, the U.S. Attorney's Office, and all its federal, state, and local partners that have a stake in ensuring that fraud is eliminated from taxpayer funded programs.”
“Far from being a victimless crime, the offenders in this investigation brazenly defrauded a combined amount of approximately $12.5 million from taxpayer funded programs,” stated Paul M. Abbate, Special Agent in Charge of the FBI Detroit Field Office. “The SNAP and WIC programs are intended to provide assistance for those in need—not a means of abuse or selfish enrichment. The FBI, along with its federal, state and local partners, remains steadfast in its commitment to root out those who steal from taxpayers and defraud our government programs.”
“The Michigan State Police recognize how important the coordination of law enforcement resources are when working with our federal law enforcement partners,” stated Col. Kriste Kibbey Etue, director of the Michigan State Police. “Bridge Card fraud harms those less fortunate so we are thankful for the support of the USDA and U.S. Attorney’s Office in bringing these cases to justice.”
“Taxpayers fund food stamps as a benefit to those who need assistance,” said Marlon Miller, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Detroit. “When unscrupulous business owners take advantage of these benefits for their own profit, the taxpayer is cheated and the individuals who really need the help also suffer.”
Prosecutions are being coordinated by Assistant United States Attorneys Frances Carlson, Abed Hammoud, Stephen Hiyama, Lee Janice, Karen Reynolds, Erin Shaw, Graham Teall, and Timothy Wyse, and by Denise Hart from the Michigan Attorney General’s Office- Al Amin Supermarket, 11920 Conant, Hamtramck, owner Moklasur Mukul, age 36, of Hamtramck;
Laguna Pueblo Man Sentenced to Thirty Months for Failure to Update his Sex Ofender RegistrationRead the Press Release
ALBUQUERQUE – Howard Ortiz, 33, was sentenced today to 30 months in federal prison for failing to comply with the Sex Offender Registration and Notification Act (SORNA). Ortiz, a member and resident of Laguna Pueblo, will be on supervised release for five years after completing his prison sentence. He will be required to register as a sex offender after he completes his prison sentence.
SORNA, known as the Adam Walsh Protection and Safety Act, requires that a convicted sex offender register in each jurisdiction where the offender resides, where the offender is employed, or where the offender is a student, and that the sex offender maintain current registrations.
Ortiz was arrested in Dec. 2012, on a criminal complaint charging him with violating SORNA. On Dec. 19, 2012, he was indicted and charged with failing to update his sex offender registration between Aug. 28, 2012 and Nov. 25, 2012. Ortiz pleaded guilty to the indictment on June 19, 2014, and admitted that he failed to maintain his registration as required by SORNA.
Ortiz is required to register as a sex offender because he was convicted of an aggravated sexual abuse offense in Feb. 2001, and was sentenced to 78 months in prison. Based on that conviction, Ortiz is required to update his sex offender registration every 90 days for the rest of his life. In Sept. 2010, Ortiz was convicted of failing to comply with SORNA and sentenced to 24 months of imprisonment.
This case was investigated by the U.S. Marshals Service and was prosecuted by Assistant U.S Attorney Kyle T. Nayback.Justice Department Settles Immigration-Related Employment Discrimination Claim Against Major AirlineRead the Press Release
The Justice Department announced today that it reached an agreement with United Continental Holdings Inc. resolving a claim that divisions of the company previously operating as Continental Airlines discriminated against individuals because of citizenship status in violation of the Immigration and Nationality Act (INA).
The department’s investigation was initiated based on a telephone call to the Office of Special Counsel for Immigration-Related Unfair Employment Practices’s (OSC) hotline. The department found that the company requested lawful permanent resident employees, but not U.S. citizen employees, to complete additional Forms I-9 and provide additional proof of employment eligibility after hire even though the law prohibits this practice. The INA’s anti-discrimination provision prohibits employers from placing additional documentary burdens on work-authorized employees during the employment eligibility verification process based on their citizenship status.
“The INA’s anti-discrimination provision protects individuals from being singled out for unnecessary and unauthorized employment reverification based on their citizenship or immigration status,” said Acting Assistant Attorney General Molly Moran for the Civil Rights Division. “We commend Continental’s willingness to resolve the issues uncovered during the department’s investigation.”
Under the settlement agreement, Continental will pay $215,000 to the United States, create a $55,000 back pay fund to compensate individuals who may have lost wages due to the company’s practices, and undergo training on the anti-discrimination provision of the INA. The company will also be subject to departmental monitoring of its employment eligibility reverification practices for a period of two years.
The Office of Special Counsel for Immigration-Related Unfair Employment Practices within the Justice Department is responsible for enforcing the anti-discrimination provision of the INA. Among other things, the statute prohibits citizenship status and national origin discrimination in hiring, firing, or recruitment or referral for a fee; unfair documentary practices; retaliation; and intimidation.
For more information about protections against employment discrimination under immigration laws, call OSC’s worker hotline at 1-800-255-7688 (1-800-237-2515, TTY for hearing impaired); call OSC’s employer hotline at 1-800-255-8155 (1-800-237-2515, TTY for hearing impaired); sign up for a free webinar at www.justice.gov/crt/about/osc/webinars.php, email [email protected]; or visit OSC’s website at www.justice.gov/crt/about/osc.
Applicants or employees who believe they were subjected to: different documentary requirements based on their citizenship status, immigration status, or national origin; or discrimination based on their citizenship status, immigration status or national origin in hiring, firing, or recruitment or referral for a fee, should contact OSC’s worker hotline for assistance.
Justice Department Seeks to Shut Down Chicago Area Tax Return PreparersRead the Press Release
The Justice Department announced today that it has asked a federal court in Chicago, Illinois, to permanently bar Anna Platos and Theodore (Ted) Platos, who do business as Midway Accounting Services, from preparing federal tax returns. According to the complaint, Ted Platos began doing business as API Tax Solutions in 2013. The civil injunction suit alleges that Anna Platos and Ted Platos claim bogus deductions and credits on customers’ federal tax returns.
Anna Platos and Ted Platos allegedly claim head-of-household filing status on customers’ tax returns in order to increase customers’ standard deductions, even though Anna Platos and Ted Platos are aware that the customers do not qualify to claim that filing status. Anna Platos and Ted Platos also allegedly fabricate claims for education credits, unreimbursed employee business expenses, charitable contributions, medical expenses, and state and local taxes paid on tax returns that they prepare. The complaint further alleges that Anna Platos fabricated a receipt purportedly supporting an energy credit that she claimed on a customer’s tax return, presented that fabricated receipt to the Internal Revenue Service (IRS) and instructed the customer to lie to the IRS.
The complaint also requests that the federal court require Anna Platos and Ted Platos to provide the government with a list of customers for whom they have prepared tax returns beginning with the 2009 tax year, to contact those customers to inform them of the injunction order, and to post a copy of the injunction order at their place of business.
Return preparer fraud is one of the IRS' Dirty Dozen Tax Scams for 2014. The IRS has some tips on their website for choosing a tax preparer. In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Related Materials:
United States v. Anna Platos, etc., et al.
Complaint for Permanent Injunction and Other ReliefJacksonville Tax Return Preparers SentencedRead the Press Release
Jacksonville, Florida – Senior U.S. District Judge Harvey S. Schlesinger sentenced Troy Solomon today to three years in federal prison for conspiracy to defraud the United States, fraud, and making false statements in the preparation of a tax return. Antonio Gadsden was sentenced today to eight months’ imprisonment for the same offenses. In addition, Solomon and Gadsden were ordered to pay restitution to the Internal Revenue Service in the amounts of $507,382 and $38,337, respectively. Solomon pleaded guilty on January 21, 2014, and Gadsden pleaded guilty on January 22, 2014.
According to court documents, from at least February 1, 2010 through April 16, 2012, Solomon was the owner and operator of Solomon’s Tax Services, LLC, a Jacksonville business that offered tax return preparation services. Solomon and his employees, including Gadsden, prepared and filed with the IRS hundreds of individual tax returns for clients during this time period. In preparing the tax returns, Solomon and Gadsden knowingly used false Schedule C income and expenses, and fictitious Schedule A itemized deductions, including moving expenses and education expenses, in order to maximize the Earned Income Credit and refunds received. Solomon’s conduct resulted in a tax loss to the United States of at least $507,382. During the same time period, Gadsden’s conduct resulted in a tax loss of at least $38,337.
This case was investigated by Internal Revenue Service – Criminal Investigation. It was prosecuted by Assistant United States Attorney Kelly S. Karase.
Jackson Woman Sentenced for Stolen Identity Refund FraudRead the Press Release
Jackson, Miss – S’ade Tyler, 28, of Jackson, was sentenced to 27 months in federal prison followed by three years of supervised release for conspiracy to defraud the United States and wire fraud, U.S. Attorney Gregory K. Davis announced today. She was also ordered to pay restitution to the U.S. government in the amount of $62,946.39.
On June 4, 2013, Tyler pled guilty to conspiring 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 located in Rankin County and from other locations. The information was then used by Tyler’s co-conspirators to file false tax returns with the Internal Revenue Service. The tax returns claimed that the tax payers were owed a refund. The refunds were then electronically deposited into various bank accounts in Mississippi belonging to Tyler and her co-conspirators.
This case was investigated by the U.S. Secret Service and the Internal Revenue Service Criminal Investigation with assistance from the Mississippi Attorney General’s Office, the Mississippi Department of Corrections and the Mississippi Department of Revenue. It was prosecuted by Assistant U.S. Attorney Patrick Lemon.If you believe you have been a victim of fraud from a person or an organization soliciting relief funds on behalf of storm victims, contact the National Center for Disaster Fraud toll free at:
(866) 720-5721
You can also fax information to:
(225) 334-4707
or e-mail it to:
Making sure that victims of federal crimes are treated with compassion, fairness and respect.
Training and seminars for Federal, State, and Local Law Enforcement Agencies.
Help us combat the proliferation of sexual exploitation crimes against children.
Intelligence Officer at Southern Command Charged with Accepting A Bribe and Helping Steal Drug ProceedsRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, announce that Jose Emmanuel Torres, 37, of Cooper City, was sentenced by U.S. District Judge K. Michael Moore to 41 months in prison, followed by two years of supervised release and ordered to forfeit $6,000. Torres previously pled guilty to a two-count information charging him with federal bribery, in violation of Title 18, United States Code, Section 201(b)(2)(A) and (B), and exceeding authorized access to a government computer, in violation of Title 18, United States Code, Section 1030(a)(2)(B) and (c)(2)(B)(i) and (ii).
According to documents filed in court in this case, Torres was assigned to the Department of Defense, Defense Intelligence Agency. His duties included collecting information regarding persons who are allegedly involved in terrorism and drug trafficking. During the course of his duties, Torres interviewed a confidential informant (CI) who was attempting to gain legal residence status in the United States and had provided Torres and other agents of the United States with information regarding persons involved in drug trafficking and terrorism. The CI had been periodically arrested on immigration violations. In August 2013, Torres told the CI that he had used his influence to have the person arrested on immigration charges. Torres asked the CI for $10,000. The CI understood that if he did not give Torres the money, Torres would use his influence to have the CI arrested again. The CI referred the matter to law enforcement and the FBI began recording text messages, telephone and Skype calls between Torres and the CI. In November 2013, the CI paid Torres $6,000 in order for Torres to use his influence to assist him with his immigration proceedings.
In or about mid-2013, Torres told the CI that he was looking to steal a delivery of drug money or identify a stash house where they could steal drug money. Torres caused another person to run a check of federal databases to determine if the persons who were to be assisting in the robbery were cooperating with the government. Torres used a “secret” email account to send the information regarding the background of the persons who were allegedly assisting in the robbery. On January 29, 2014, Torres provided the CI a detailed four-page DEA seizure form dated January 31, 2014 that reflected a bulk cash seizure in the amount of $500,000. The CI requested the DEA seizure form in order to tell the owners of the money in Colombia that the money was seized. Torres was told that for providing the seizure receipt that Torres would receive $250,000 from the money stolen from the drug dealers. On January 31, 2014, Torres was called and the CI told Torres that he had stolen the drug proceeds and for Torres to meet him and get his portion of the stolen drug proceeds, which was $250,000. Torres met the person in a parking lot in Dania and was provided a duffel bag with $250,000.
Mr. Ferrer commended the investigative efforts of the FBI. Mr. Ferrer would also like to thank the Drug Enforcement Administration and the United States Secret Service for their assistance. The case is being prosecuted by Assistant U.S. Attorney Jeffrey N. Kaplan.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Indian Tribes in Kansas Receive More Than $1.3 Million in Public Safety GrantsRead the Press Release
KANSAS CITY, KAN. – Indian tribes in Kansas are being awarded more than $1.3 million in public safety grants from the U.S. Dept. of Justice, U.S. Attorney Barry Grissom said today.
“Protecting public safety in Indian Country is a critical part of our goal to strengthen and sustain native communities in Kansas,” said U.S. Attorney Barry Grissom.
The grants, awarded through the Justice Department’s Coordinated Tribal Assistance program, include:
- Kickapoo Tribe in Kansas: $449,824 from the Violence Against Women Tribal Governments Program through the Office on Violence Against Women (OVW).
- Prairie Band Potawatomi Nation: $365,386 from the Comprehensive Tribal Victim Assistance Program through the Office for Victims of Crime (OVC).
- Sac and Fox Nation of Missouri in Kansas and Nebraska: $547,482 from the Violence Against Women Tribal Governments Program through the Office on Violence Against Women (OVW).
Nationally, the Justice Department has announced 169 grants in FY 2014 to American Indian tribes totaling more than $87 million to enhance law enforcement practices and sustain crime prevention and intervention efforts. The grants are awarded in purpose areas including public safety and community policing, justice systems planning, alcohol and substance abuse, corrections and correctional alternatives, violence against women, juvenile justice and tribal youth programs.
Henderson, Nev. Man Sentenced to Two Years in Prison for Aiming Laser Pointer at Police HelicopterRead the Press Release
LAS VEGAS, Nev. - A Henderson, Nev. man was sentenced today to two years in prison for aiming a laser pointer at a Las Vegas Metropolitan Police Department (LVMPD) helicopter on six occasions earlier this year, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
James David Zipf, 30, pleaded guilty in June to one count of aiming a laser pointer at an aircraft, and was sentenced by U.S. District Judge Miranda M. Du. Zipf was permitted to self-report to federal prison by December 30, and must also serve three years of supervised release and undergo mental health and substance abuse treatment.
Zipf admitted that just after midnight on Jan. 30, 2014, he aimed a blue laser four times at the LVMPD helicopter from the second story window of the Green Valley neighborhood house where he lived. Zipf also admitted that on Feb. 3, 2014, at about 9:00 p.m., he pointed the blue laser light two times at a LVMPD helicopter causing one of the flight officers to experience a severe headache. Zipf was convicted in 2011 in Phoenix, Ariz. of pointing a similar blue laser at a police helicopter there.
“In 2012, it became a federal felony offense to knowingly target an aircraft with a laser,” said U.S. Attorney Bogden. “This activity is extremely dangerous, and can disorient and temporarily blind a pilot. If you have information about a lasing incident or see someone pointing a laser at an aircraft, call your local FBI field office or dial 911.”
Since the FBI and the Federal Aviation Administration (FAA) began tracking laser strikes in 2005, statistics reflect a more than 1,100 percent increase in the deliberate targeting of aircraft by people with handheld lasers. In 2013, there were 3,960 laser illumination incidents reported by pilots to the FAA. This is an average of 10.8 incidents every night.
The case was investigated by the FBI and LVMPD, and prosecuted by Assistant U.S. Attorney Roger Yang.Georgia Man Sentenced to 10 Months in Prison for Discharging Waste into Potomac River- Defendant Managed Clean-Up of Storm Sewer System at National Mall -Read the Press Release
WASHINGTON - Patrick Brightwell, 48, of Bogart, Ga., was sentenced today to 10 months in prison on charges that he orchestrated the discharge of waste into the Potomac River at East Potomac Park from 2009 through 2011, during the same period he managed the company hired by the National Park Service to clean out the storm water sewer system on the National Mall.
The sentence was announced by Acting Assistant Attorney General Sam Hirsch of the Environment and Natural Resources Division of the Department of Justice; Ronald C. Machen Jr., U.S. Attorney for the District of Columbia, David G. McLeod, Jr. Special Agent in Charge of the Environmental Protection Agency’s criminal enforcement program for the Middle Atlantic States, and Robert D. MacLean, Acting Chief, United States Park Police.
Brightwell pled guilty in June 2014, in the U.S. District Court for the District of Columbia, to one count of violating the Clean Water Act by knowingly discharging a pollutant without a permit and one count of presenting false claims to the United States. He was sentenced by the Honorable James E. Boasberg. Upon completion of his prison term, Brightwell will be placed on three years of supervised release. He also was ordered to pay $270,667 in restitution to the National Park Service, representing the losses for the work that was not properly performed. Brightwell also must pay a forfeiture money judgment totaling $230,899.
An eight-count indictment of Brightwell was unsealed following his arrest in Georgia on Dec. 5, 2013. The remaining charges were dismissed as part of the guilty plea.
“This government contractor is now paying the price for ripping off the taxpayer and dumping waste in the Potomac River,” said U.S. Attorney Machen. “This prison sentence demonstrates how serious we are about enforcing the Clean Water Act. We will continue to use the criminal laws to protect our country’s most treasured natural resources.”
“The Potomac is a national treasure, and EPA is committed to keeping it safe and clean” said Special Agent in Charge McLeod. “The defendant knowingly dumped untreated wastewater into this historic waterway, and needs to be held accountable. Wastewater that is illegally discharged is a danger to public health and a threat to the environment.”
“The sentence in this case shall serve as a reminder that environmental crimes will not be tolerated by the National Park Service, law enforcement, the criminal justice system, and the community," said Acting Chief MacLean. “I applaud the collaborative efforts of every agency involved as a testament to the inherent dedication to protecting our nation's natural resources.”
According to a statement of offense signed by the government and defendant, from in or about 2007 through 2011, Brightwell was a manager of a company that had a contract with the National Park Service to clean the storm water sewer system on the National Mall. The contract required that waste removed from the Mall’s storm drains and oil-water separators be disposed of at a proper disposal facility in compliance with District of Columbia regulations and federal law.
Brightwell hired employees and subcontractors to perform work under the contract and oversaw their work from 2008 to 2011. To clean the structures, Brightwell and his company used a vacuum truck, a vehicle designed to gather, store, and transport such waste. When the storage compartment in the vacuum truck became full, workers would have to discharge waste from the truck prior to continuing the cleaning.
In 2009, 2010, and 2011, according to the statement of offense, Brightwell directed his employees and subcontractors to discharge waste from the vacuum truck at a storm drain near a parking lot in East Potomac Park, across Ohio Drive from the Potomac River. Brightwell concealed these discharges from the National Park Service and police. Workers also discharged waste at a manhole near Fort McNair in the District of Columbia.
During this period, Brightwell continued to invoice the National Park Service for cleaning services, but concealed and did not disclose that the waste was not being properly disposed, as required by the contract. From 2009 through 2011, Brightwell’s company received approximately $406,000 in payments from the National Park Service related to the contract.
According to the statement of offense, the employees and subcontractors illegally dumped waste at the parking lot approximately two-thirds of the time, and dumped the waste at a proper disposal facility in Fort Washington, Md., about one-third of the time.
The subcontractor, B&P Environmental LLC, and a B&P employee working on June 6, 2011, both pled guilty in November 2014 to violations of the Clean Water Act before the U.S. District Court. As part of their pleas, both the company and employee agreed to cooperate with the government’s investigation. Both the company and employee are awaiting sentencing.
The case was investigated by Special Agent S. Christopher Michael of the EPA and Detective Jon Crichfield of the U.S. Park Police and supported by Environmental Protection Specialists Jerry Crutchley and Justin Young. It was prosecuted by Senior Trial Attorney Lana Pettus of the Department of Justice’s Environmental Crimes Section and Assistant U.S. Attorney Jonathan P. Hooks of the U.S. Attorney’s Office for the District of Columbia. Assistant U.S. Attorneys Anthony Saler and Catherine Connelly of the Asset Forfeiture and Money Laundering Section assisted with the case. Further assistance was provided by Paralegal Specialist Ashleigh Nye of DOJ’s Environmental Crimes Section and Paralegal Specialists Krishawn Graham and Donna Galindo of the U.S. Attorney’s Office.
14-214Gaithersburg Man Pleads Guilty in Bank Fraud SchemeRead the Press Release
Baltimore, Maryland – Phong Dinh Tran, age 40, of Gaithersburg, Maryland, pleaded guilty today to conspiring to commit bank fraud arising from a scheme to use a straw purchaser to buy a liquor store.The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Small Business Administration Inspector General Peggy E. Gustafson; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; and Postal Inspector in Charge Gary R. Barksdale of the U.S. Postal Inspection Service - Washington Division.
According to his plea agreement, Tran created R&K Real Estate Investment, Inc. to buy Potomac Wine & Spirits, a liquor store in Hagerstown, Maryland. Tran was the majority and controlling owner of R& K, and K.P. had a minority ownership interest. In May 2006 Tran and K.P. signed agreements to buy the liquor store for $899,000 and the real estate that the store occupied for $400,000.
Tran sought Joon Park, a principal of Jade Capital & Investments, to broker a loan for the store’s purchase. Tran and Park discussed obtaining a loan at PNC Bank that was guaranteed by the U.S. Small Business Administration (SBA). Because Tran had significant debt from the purchase of residential properties, Park advised that Tran would not likely be approved for an SBA guaranteed loan.
Tran disclosed to Park that he could use a straw buyer, T.C.P., for the loan. Tran and Park agreed that they would falsely represent to PNC that T.C.P. would be the owner and operator of the liquor store. Tran asked the straw buyer to apply for the loan and promised that he, Tran, would pay all the bills for the store and make the loan payments. The settlement for the sale of the liquor store to R&K occurred on September 29, 2006. The straw purchaser falsely represented to PNC that he was the president of R&K. The funds needed to close the transaction were provided by Tran, not the straw purchaser. PNC funded a loan of $950,000.
After the closing, Tran ran the liquor store. On January 22, 2007 Tran sold a 50% stake in the store to another individual for $380,000. During the sale, Tran represented to the individual that he owned 100% of the store. In 2007, Tran stopped making loan payments to PNC and the loan went into default.
Tran faces a maximum sentence of 30 years in prison and a $1 million fine. U.S. District Judge William D. Quarles, Jr. scheduled his sentencing for December 18, 2014, at 1:00 p.m.
In a separate case, Joon Park, a/k/a “Joon Pak,” and “Joon Paik,” age 44, of Falls Church, Virginia, previously pleaded guilty to his role in a bank fraud conspiracy arising from a scheme to fraudulently obtain numerous business loans guaranteed by the SBA, with resulting losses of over $100 million. Park submitted false SBA loan applications on behalf of his clients from 2003 to 2011. Judge Quarles sentenced Park on June 20, 2013 to 15 years in prison and ordered Park to pay a money judgment of $91,449,700.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Since the inception of FFETF in November 2009, the Justice Department has filed more than 12,841 financial fraud cases against nearly 18,737 defendants including nearly 3,500 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
United States Attorney Rod J. Rosenstein commended the SBA-OIG, FBI and U.S. Postal Inspection Service for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Leo J. Wise and Sean Delaney, who are prosecuting the case.
Former Wichita Man Sentenced for $2.7 Million Mortgage FraudRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a former Wichita, Kan., man was sentenced in federal court today for his role in a $2.7 million mortgage fraud scheme.
Terrence Matthew Brown, also known as Terry Brown, 49, of Round Rock, Texas, formerly of Wichita, was sentenced by U.S. District Judge Brian C. Wimes to seven years and three months in federal prison without parole. The court also ordered Brown to pay $1,201,635 in restitution.
On May 2, 2013, Brown was found guilty of conspiracy to commit wire fraud and five counts of wire fraud.
Brown participated in a mortgage fraud conspiracy in 2006 in which mortgage lenders were defrauded in 10 separate loans for five properties, which were obtained by false statements in loan applications and other documents. Mortgage loans totaling $2.7 million were approved to purchase properties in Greenwood, Mo., Kansas City, Mo., Overland Park, Kan., and Leawood, Kan., all within a period of three months.
The scheme involved Brown buying homes at inflated prices, obtaining mortgage loans by fraud at the inflated amounts, and receiving kickbacks from the excess loan proceeds without the lenders’ knowledge. In order to qualify for the loans, Brown lied to lenders about his income, his employment, his assets and liabilities, his intent to occupy the properties and other matters.
Brown and co-conspirators structured the home purchases in such a way that Brown would receive money from the loan proceeds without the knowledge or consent of the lenders. Brown received more than $200,000 in illegal kickbacks. In order to receive the kickbacks without the lenders finding out, Brown submitted false invoices to the title companies closing the loans. The invoices were in the names of businesses that claimed to be entitled to payment for services supposedly rendered.
All the loans went into default and the properties were foreclosed.
According to court documents, Brown would not have qualified financially for the loans if he had been truthful, as his income would not have supported the loans.
Brown failed to live in any of the five properties as his primary residence. Brown was a sex offender required to register where he lived; he reported to law enforcement that he lived in two of the properties for brief periods, but he failed to make any of them his primary residence for a year as required by the mortgages. He also made only $28,778 in total mortgage payments – barely more than one month of combined payments on the loans – before he defaulted on each of the loans.
This case was prosecuted by Assistant U.S. Attorney Linda Parker Marshall. It was investigated by the FBI.Former Treasurer for Communication Workers of America Local 88329 Sentenced to Two Years’ Probation for Falsifying RecordsRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a 46-year-old Coudersport, Pennsylvania resident was sentenced yesterday in federal court in Wilkes-Barre to two years’ probation and ordered to pay more than $6,000 in restitution by U.S. Magistrate Judge Karoline Mehalchick for falsifying records in connection with his duties as treasurer for the Communication Workers of America Local 88329.
According to United States Attorney Peter Smith, Robert Vargeson falsified those records to conceal the fact that he had embezzled $6,013 from the union’s funds. Vargeson committed the offense during 2012 and 2013.
Vargeson was charged in a criminal Information filed by the United States Attorney on April 14, 2014. Vargeson pleaded guilty to the charge on April 24, 2014.
The prosecution of Vargeson resulted from an investigation by the U.S. Department of Labor.
Assistant U.S. Attorney Francis P. Sempa represented the government at sentencing.
Former Postal Clerk Convicted of Embezzling from U.S. Postal ServiceRead the Press Release
St. Thomas, USVI- After a two-day trial in the District Court in St. Thomas, Virgin Islands, a federal jury today found Rosemarie Peltier, a former postal clerk, guilty of embezzling thousands of dollars from the United States Postal Service (USPS), announced United States Attorney Ronald W. Sharpe and Special Agent in Charge Ricardo Medina of the Office of Inspector General of the United States Postal Service in Puerto Rico.
Peltier, who was employed at the Aubrey C. Ottley Post Office in Estate Thomas, was indicted earlier this year by a Federal Grand Jury for Misappropriation of Postal Funds, Embezzlement of Government Property, and False Entries and Reports of Money. The evidence presented at trial showed that Peltier devised a scheme to defraud and embezzle from the USPS by misusing the machine used to issue and record money orders. To cover up her crime, Peltier would then make false entries into the USPS’ computer system in an attempt to conceal the money that she embezzled. The evidence also showed that between 2010 and 2013, Peltier embezzled nearly $30,000. After deliberating for several hours, the jury returned guilty verdicts on all counts. Peltier was released on conditions, including an unsecured bond pending sentencing, which is scheduled for January 22, 2015.
Peltier faces a maximum sentence of ten (10) years imprisonment and fines of up to $250,000 on each count of conviction. United States Attorney Sharpe commended the efforts of the Office of Inspector General of the United States Postal Service who investigated the case. The case was prosecuted by Assistant U.S. Attorney Ishmael Meyers, Jr.
Former Olean Nurse Sentenced for Possesion of Child PornographyRead the Press Release
BUFFALO, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that Willie G. Reid, 47, of Olean, N.Y., who was convicted of possession of child pornography, was sentenced to 90 months in prison by U. S. District Judge Richard J. Arcara.
Assistant U.S. Attorney Marie P. Grisanti, who handled the case, stated that on May 2, 2013, the defendant possessed more than 600 images on a computer and hard drive in his residence. Some of the videos and images included pre-pubescent children and depictions of violence. At the time of his arrest, Reid was employed as a Registered Nurse at the Olean General Hospital.
The sentencing is the culmination of an investigation on the part of Special Agents of the Federal Bureau of Investigation, and the Cattaraugus County Sheriff’s Department, under the direction of Sheriff Timothy Whitcomb.Former Ohio Man Indicted for $1.2 Million Bank FraudRead the Press Release
A grand jury returned a four-count indictment charging a Mississippi man for a conspiracy in which he defrauded a Tennesse bank out of $1.2 million, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Paul D. Allen, age 52, of Oxford, Mississippi, age 52, was indicted on one count of conspiriacy to commit bank fraud and three counts of bank fraud.
Allen, a self-proclaimed entrepreneur and businessman, moved to the Northern District of Ohio in 1999. Prior to that, he lived in Tennessee, where he developed a relationship with Stephen Henry, an unindicted co-conspirator.
Allen and Henry executed a scheme to defraud Oakland Deposit Bank and obtain money and property from the bank by means of materially false and fraudulent representations. The bank was chartered and had offices in Tennessee. Henry served as president of the bank and also served as a loan officer, according to the indictment.
Allen contacted several people in Ohio and recruited them to invest in various business projects he promoted, including B-Telecom Incorporated, a purported data-storage company. Allen promised investors they would receive a percentage ownership in the business in return for the investors obtaining loans from the Oakland Deposit Bank in their own names. Allen told the investors the loan proceeds would be used for operating the business, according to the indictment.
Between 2003 and 2008, Allen had the investors complete loan documentation in support of the loans, and then submit the loan applications to Henry, or accompany the investors when they submitted the loan applications to Henry, according to the indictment.
Allen forged borrower signatures on loans for amounts ranging between $42,770 and $168,000. He sometimes took out additional loans in borrowers' names without their knowledge. He used the proceeds to pay personal expenses or to make interest payments on existing loans, according to the indictment.
If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The case is being prosecuted by Assistant U.S. Attorney M. Kendra Klump following an investigation by the Federal Bureau of Investigation (Cleveland Division, Painesville Resident Agency) and with the assistance of the Geauga County Prosecutor’s Office.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Former Illinois Department of Public Health Administrator Pleads Guilty to Bribery, Kickback Scheme and Filing False Income Tax ReturnRead the Press Release
Springfield, Ill. – A former human resources director for the Illinois Department of Public Health, Roxanne Jackson, waived indictment and pled guilty today to an information that charges her with participating in a bribery and kickback scheme related to state grants and contracts and filing false income tax returns. The information was filed by the U.S. Attorney’s Office for the Central District of Illinois.
Jackson, 49, of Olympia Fields, Ill., appeared this afternoon before U.S. Magistrate Judge Thomas P. Schanzle-Haskins in Springfield to enter her plea. Sentencing for Jackson has been scheduled for Jan. 26, 2015, before U.S. District Judge Sue E. Myerscough.
According to court documents, Jackson was an associate of IDPH Chief of Staff Quinshanta Golden when Jackson and Golden devised a scheme to defraud the state related to grant funds and contract monies. Golden previously pled guilty on Apr. 10, 2014, to her role in the bribery and kickback scheme and obstruction of justice. Golden is scheduled to be sentenced on Oct. 31, 2014.
During today’s court hearing, Jackson admitted that from 2006 to 2010, she received more than $1,000,000 in grant funds originally awarded and disbursed to three Chicago not-for-profit organizations and in contract funds to a business identified as Security Firm A. As part of the scheme, at Golden’s direction, Jackson was hired as a paid consultant for the three not-for-profit entities and Security Firm A.
From 2004 to 2010, IDPH awarded more than 30 non-competitive grants totaling more than $11 million to three not-for-profit organizations: Broadcast Ministers Alliance, Access Wellness and Racial Equity, and the Medical Health Association. The grants were for programs relating to breast, cervical and prostate cancer, HIV/AIDS, and emergency preparedness. From 2006 through 2010, Security Firm A was paid more than $2 million in contract funds to conduct background checks and interviews of Illinois nursing home residents related to the Identified Offender Program.
Jackson admitted that as a condition to receive grant funds, she was required to pay Golden one-half of whatever she received, less any funds to be withheld for payment of taxes, which were never paid. Jackson admitted that from about July 2007 to April 2008, she made cash withdrawals of grant funds from her bank accounts and made cash payments to Golden ranging from $5,000 to as much as $70,000.
In agreement with Golden, Jackson further admitted that she was required to pay Golden kickbacks for each background investigation performed by Security Firm A. The payments ranged from $35 to $40 per investigation performed. From 2006 to 2009, Jackson received approximately $485,000 in funds from Security Firm A’s contracts with IDPH, and during 2007 and 2008, made kickback payments to Golden of approximately $109,500 in contract funds.
As a result of the scheme, from about July 2007 and continuing to approximately October 2008, Jackson admitted she repeatedly made kickback payments to Golden of grant and contract funds for a total of approximately $433,000.
As to Jackson’s filing false income tax returns for tax years 2006, 2007, 2008, and 2009, Jackson admitted she caused the filing of false and fraudulent federal income tax returns by failing to report a total of $908,266 in income, resulting in failure to pay $172,825 in taxes due.
At sentencing, according to the terms of the plea agreement, the government has agreed to recommend to the court a sentence at the low end of the applicable advisory sentencing guidelines, no more than 51 months in prison. According to the plea agreement, the parties agree that restitution amount for filing false income tax returns is $172,825. A restitution amount for the bribery offense has not been determined.
Central District of Illinois U.S. Attorney Jim Lewis expressed his appreciation to the federal law enforcement officers assigned and the agencies that support the Central District of Illinois U.S. Attorney’s Office’s Public Corruption Task Force: the U.S. Postal Inspection Service, Chicago Division; Internal Revenue Service, Criminal Investigation, Chicago Field Office; and the Illinois Secretary of State Office of Inspector General. Assistant U.S. Attorney Timothy A. Bass is prosecuting the case on behalf of the U.S. Attorney’s Office for the Central District of Illinois.Individuals who wish to provide information to law enforcement regarding matters of alleged public corruption are urged to call the U.S. Attorney’s Office at 217-492-4450.
Former Federal Corrections Officer Pleads Guilty to Bribery ChargeRead the Press Release
Ocala, Florida – United States Attorney A. Lee Bentley, III announces that Antoine D. Clark (30, Orlando) pleaded guilty today to an indictment charging him with receipt of a bribe by a public official. He faces a maximum penalty of 15 years in federal prison. A sentencing date has not yet been set.
According to the plea agreement, Clark was employed as a Corrections Officer by the Federal Bureau of Prisons at the Coleman Federal Correctional Complex, in Sumter County. Based on information from inmates at the facility, agents discovered that Clark had been smuggling tobacco products, alcoholic beverages, cell phones, and pornography into the prison. In exchange for these items, inmates had arranged for Clark to be paid by cash or wire transfers from third parties.
Following his arrest on June 26, 2014, Clark admitted that he had smuggled contraband into the prison in exchange for bribes. He received $28,450.00 in illegal payments, all of which is being forfeited.
This case was investigated by the Department of Justice, Office of the Inspector General. It is being prosecuted by Assistant United States Attorney Robert E. Bodnar, Jr.
Former Federal Bureau of Prison Employee Sentenced for Fraudulently Obtaining Federal Workers Compensation benefitsRead the Press Release
United States Attorney James L. Santelle of the Eastern District of Wisconsin announced today that on September 19, 2014, Christopher A. Seifer (age: 43) of Westfield, Wisconsin, was sentenced to 15 months imprisonment followed by three years of supervised release, and ordered to pay $84,717.60 in restitution to the U.S. Department of Labor. Seifer was also ordered to pay a $500 special assessment.
On February 4, 2014, Mr. Seifer was charged in a five-count indictment alleging that he had submitted more than 1,380 fraudulent claims seeking reimbursement from the federal government for mileage expenses that he falsely claimed to have incurred by driving to health clubs for self-directed pool-therapy sessions. The indictment alleged that Mr. Seifer did not, in fact, travel to the health clubs on many of his claimed dates of travel between March 28, 2006, and October 2, 2012, for which Mr. Seifer had sought and obtained more than $84,000 in mileage-expense reimbursements. On June 19, 2014, following a four-day trial, a jury found Mr. Seifer guilty on all counts.
The evidence produced at trial demonstrated that Mr. Seifer had defrauded the Department of Labor’s Office of Workers Compensation Program, which provides disability-related benefits to federal workers who suffer disabilities as a result of work-related injuries, by submitting false travel reimbursement claims and obtaining payments on those false claims. Mr. Seifer had formerly been employed by the United States Bureau of Prisons as an Electronics Technician at the Federal Correctional Institution in Oxford, Wisconsin, where he suffered work-related injuries and was then entitled to receive benefits, including medical benefits under the Federal Employees Compensation Act.
In making today’s announcement about the sentence, United States Attorney Santelle stated: “The 15-month incarceration term imposed on this defendant reflects the gravity and breadth of the fraud that Mr. Seifer perpetrated on the United States Bureau of Prisons and the United States Department of Labor —and on the public whose trust he compromised. The fact that he is also now obliged, following a full trial and exposition of his false statements and claims for reimbursement under the Workers Compensation Program, to pay restitution in an amount of nearly $85,000 similarly confirms the vigor and the focus of the investigative and prosecutorial work that has preceded this result. I commend specially the United States Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, along with the United States Department of Justice’s Office of Inspector General, for the professionalism and precision of their investigative efforts in bringing this defendant and his fraudulent conduct to a decisive and deterrent-accomplishing end.”
This case was investigated by the United States Department of Labor, Office of Inspector General, Office of Labor Racketeering & Fraud Investigations and the United States Department of Justice Office of the Inspector General, Chicago Field Office. This case was prosecuted by Assistant United States Attorneys Scott Campbell and Benjamin Proctor.
Former Fayette Sheriff's Department Employee Sentenced for Theft of Concealed Weapons FeesRead the Press Release
Charleston, W.Va. – United States Attorney Booth Goodwin announced that Cheryl Gray, 44, of Hilltop, West Virginia was sentenced today in federal court in Charleston to one year and one day in federal prison for mail fraud involving concealed weapons permits. Gray is a former employee of the Fayette County Sheriff’s Department where her duties included the collection of application fees for concealed weapons permits, and creating and submitting a list of permits issued by Fayette County to the West Virginia State Police. Gray previously pled guilty to mail fraud in June of 2014. At the plea hearing, Gray admitted that she stole the cash payments made by applicants for concealed weapons permits. She hid the theft by creating incomplete applicant lists and submitting them to the West Virginia State Police, omitting close to 400 names of applicants who had paid in cash. The fraud, which continued for more than six months, resulted in a combined loss to the Fayette County Sheriff’s Department and West Virginia State Police of approximately $40,000.
The West Virginia State Police, Fayette County Sheriff’s Department, and the Federal Bureau of Investigation conducted the investigation.
Defendant was sentenced by United States District Court Judge John T. Copenhaver, Jr.
Former Drug Property in Fairview Heights ForfeitedRead the Press Release
House Located at 20 Kassing Drive, Scene of Drug Overdose Deaths, Will Be Demolished
Follow @SDILNewsStephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today that the forfeiture proceedings against the former drug house and real property located at 20 Kassing Drive in Fairview Heights, Illinois, have been completed. The property will be given to the City of Fairview Heights for public use. It is believed that the City will proceed with demolition of the building on property and eventually turn the property into a “pocket” park area.
“I am hopeful that the eventual use of this land by the citizens of Fairview Heights as a place of peace and relaxation will help erase the awful memories of the drug deals and the deaths which were connected to this site.” said United States Attorney Wigginton.
Deborah A. Perkins, 66, the owner of the property, forfeited her rights to her home and signed a Stipulation and Consent to Forfeiture. Perkins admitted that she sold heroin from the residence. Two young women, Jessica Williams and Jennifer Herling, died as a result of the drugs they received from persons at this residence. In addition to losing her home, Perkins was sentenced to 324 months imprisonment.
Lennil Johnson, of the St. Clair County Jail, attempted to take advantage of the forfeiture proceedings. Johnson filed fictitious claims against 20 Kassing Drive, claiming an ownership interest in the property. In adjudicating this forfeiture, the District Court denied Johnson’s claims, and, on April 1, 2014, sanctioned Johnson $1,000 for his actions. The Seventh Circuit Court of Appeals upheld the District Court’s handling of this action.
Former Danville Jail Employee Pleads Guilty to Stealing Inmates' MailRead the Press Release
September 23, 2014
DANVILLE, VIRGINIA – A former corrections officer at the Danville Adult Detention Center pled guilty today to a charge related to his admitted stealing of mail addressed to inmates at the facility.
Ezra Lamont Price, 33, of Danville, waived his right to be indicted today and pled guilty to an Information that charged him with one count of theft of mail. At sentencing, the defendant faces up to five years in federal prison and/or a fine of up to $250,000.
Today in District Court, Price admitted to taking mail intended for inmates being housed at the Danville Adult Detention Center, opening that mail and taking things of value contained within. Those items included cash, money orders and gift cards.
During an investigation by the United States Postal Service-Office on the Inspector General, several pieces of mail containing gift cards were sent in an undercover capacity from federal agents to prisoners at the Danville Adult Detention Center. That mail and the gift cards contained within, were diverted by Price and used at local businesses.
The investigation of the case was conducted by the United States Postal Service- Office of the Inspector General, the United States Postal Inspection Service and the Danville City Police Department. Assistant United States Attorney Laura Rottenborn will prosecute the case for the United States.
Former Business CEO Pleads Guilty to Orchestrating A Ponzi Scheme and Tax ChargesRead the Press Release
PHILADELPHIA - Walter P. Lambert, a/k/a “Buddy,” 73, of Pen Argyl, PA, pleaded guilty today to 16 counts of mail fraud, five counts of wire fraud, and one count of interfering with the due administration of the Internal Revenue Service. A sentencing hearing is scheduled for December 29, 2014. Lambert was the CEO of Blue Mountain Consumer Discount Company (“BMCDC”), a consumer loan company based in Wind Gap, Pennsylvania. He defrauded individual lenders into loaning over $5 million to BMCDC by promising them a high rate of return (typically 9% or 10%), which Lambert usually paid to the investors in cash and failed to document with the IRS.
Lambert told the individual lenders that BMCDC would use the lenders’ funds to issue high-interest loans to consumers (at an interest rate of approximately 23% to 26%), thereby allowing BMCDC to make a profit of approximately 13% to 16% after paying the individual lenders their 10% return. However, rather than using the individual lenders’ loan principal payments to issue new consumer loans, Lambert used the funds for his own benefit, including: to pay BMCDC’s overhead (including his own salary); to purchase a life insurance policy for himself; to purchase personal items and collectibles for himself and his family members; to pay for gasoline and repairs to personal cars owned and used by himself, his family members, and the owner of BMCDC; and to issue loans to himself, his children, and other “preferred” consumers at a rate of 6% interest per year or less, rather than the annual interest rate of 23% to 26% that the individual lenders were quoted. Prior to borrowing the principal from the individual lenders, Lambert failed to disclose that their loan principal would be used as set forth above. In order to keep the scheme afloat, Lambert continued to borrow money from new individual lenders, lied to them about what he would do with the money, and used the new loans to pay the old lenders their interest, and to pay BMCDC’s salary and overhead expenses.
Lambert doctored the books of BMCDC, submitted false annual reports to the Pennsylvania Department of Banking, and falsified BMCDC’s tax returns. He withdrew hundreds of thousands of dollars from BMCDC for the benefit of himself that he caused to be recorded as “loans” to himself and his family members. In falsely issuing these “loans” to his family members, Lambert forged the signatures of his family members on the loan paperwork and the checks issued by BMCDC, and deposited the checks into his personal bank accounts. Lambert documented fictitious payments to deceive the Pennsylvania Department of Banking into believing that BMCDC was financially sound and operating appropriately.
Lambert also interfered with the due administration of the Internal Revenue Service by, among other things, overstating corporate income, understating BMCDC’s salaries and wages by failing to record cash salary payments to BMCDC employees, understating BMCDC’s interest expenses by failing to record interest payments to individual lenders that were made in cash, and submitting false tax returns for BMCDC. Lambert is also to have paid a 1% “kickback” to one of the individual lenders, Nicholas R. Sabatine, III, charged separately, a local area attorney who referred clients to Lambert. While Lambert paid Sabatine’s clients 9% interest by check and provided them and the IRS with accurate annual IRS Forms 1099, Lambert paid Sabatine his promised 1% kickback in the form of cash that neither Lambert nor Sabatine timely declared to the IRS.
Lambert allegedly caused over 20 individual lenders to sustain losses of approximately $2,269,503, and caused the IRS to sustain a tax loss of at least approximately $252,621 for tax years 2007 through 2009.
Lambert faces a possible advisory sentencing guideline range of 51 to 63 months in prison, up to a three-year period of supervised release, restitution to the IRS, a fine of up to $5.5 million fine, and a $2,200 special assessment.
The case was investigated by the Internal Revenue Service Criminal Investigations and the FBI. It is being prosecuted by Assistant United States Attorney Michael S. Lowe.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Former Auto Parts Factory Manager Pleads Guilty to Fraud for Stealing and Selling PartsRead the Press Release
BIRMINGHAM -- A former manager at an automobile parts manufacturer in Vance pleaded guilty today to mail fraud in connection to parts he stole from the company and sold for personal profit, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
SAMUEL LANE WOODWARD, 40, of Tuscaloosa, entered his guilty plea to one mail fraud count before U.S. District Judge Sharon Lovelace Blackburn. His sentencing date has not been set.
As part of Woodward's plea agreement with the government, he is to pay T.W. Fitting-N.A. $46,051 in restitution. The government also seeks to have Woodward forfeit that same amount as proceeds of illegal activity.
Woodward was acting plant manager at T.W. Fitting from Nov. 1, 2011, to Aug. 1, 2012, and production manager from Aug. 1, 2012, to Dec. 11, 2012, when the company terminated his employment, according to his plea agreement.
T.W. Fitting assembled Tire Pressure Monitoring System valves and sold wheel rims. An FBI investigation revealed that Woodward stole TPMS valves and wheel rims from the factory in 2012 and sold them for personal profit to a business associate in Georgia. Woodward acknowledged in his plea agreement that the Georgia man mailed him a $12,050 check as payment for valves and wheel rims stolen from T.W. Fitting.
The maximum sentence for mail fraud is 20 years in prison and a $250,000 fine.
The FBI investigated the case, which Assistant U.S. Attorney Elizabeth A. Holt is prosecuting.
Former Assistant Vice President for Bergen County, N.J., Bank Charged with Embezzling over $1 MillionRead the Press Release
NEWARK, N.J. - A former assistant vice president at a Fort Lee, New Jersey bank surrendered to the FBI today for her alleged involvement in a scheme to embezzle over $1 million from her employer, U.S. Attorney Paul J. Fishman announced.
Miye Chon, a/k/a/ “Karen Chon,” 34, of Englewood Cliffs, New Jersey, is scheduled to make her initial appearance today before U.S. Magistrate Judge Steven C. Mannion in Newark federal court. She is charged by complaint with theft, embezzlement or misapplication of funds by a bank officer or employee.
According to the complaint unsealed today:
Chon was employed by BankAsiana, a federally insured financial institution, until the bank was acquired in October 2013. Chon was an operations officer and later an assistant vice president at the Fort Lee branch. As a result, she had access to customer accounts, as well as the bank’s internal account records, computer system and vault.
Over the course of several years, Chon allegedly stole over $1 million from BankAsiana’s customer accounts by regularly making unauthorized transfers from customer certificate of deposit (CD) accounts into BankAsiana’s vault cash account, and then physically removing cash from the bank’s vault.
BankAsiana’s successor bank began an internal investigation after a customer found problems with tax forms and account records. The successor bank discovered that Chon, using her unique credentials, accessed BankAsiana’s computer systems on multiple occasions to make unauthorized transfers from customer CDs to the bank’s vault account before removing the cash. Chon had avoided detection by making false entries in the bank’s records and ensuring that funds she removed from CDs were transferred back into those accounts before they were set to reach maturity.
Chon allegedly embezzled funds on dozens of occasions, typically taking tens of thousands of dollars at a time, and one time converting as much as $100,000 from a customer’s CD account. Bank records show that during one week between September 27, 2013 and October 4, 2013, Chon’s last day working at the bank, she made multiple unauthorized transfers from customer accounts totaling approximately $1.2 million to cover losses in other customer accounts that she had previously looted. According to the successor bank’s investigation, the scheme resulted in an approximate $1.4 million loss to the bank.
Chon faces a maximum sentence of 30 years in prison, a maximum fine of the greater of $1 million or twice the gross gain or loss from the offense, and a mandatory restitution order in the full amount of BankAsiana’s loss.
U.S. Attorney Fishman praised special agents of the FBI’s Newark Field Office, under the direction of Special Agent in Charge Aaron T. Ford, for their work on this case.
The charge in the complaint against Chon is merely an accusation, and the defendant is considered innocent unless and until proven guilty.
The government is represented by Assistant U.S. Attorney Paul A. Murphy of the U.S. Attorney’s Office’s Economic Crimes Unit in Newark.
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Defense counsel: Matthew Jeon Esq., Fort Lee
Chon, Miye Complaint
Five Defendants Sentenced to Prison Terms for Multi-Million Dollar Theft of Pre-Retail Medical ProductsRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and David W. Bourne, Special Agent in Charge, Food and Drug Administration, Office of Criminal Investigation (FDA-OCI), Miami Field Office, announce that five Miami-area residents were recently sentenced to prison terms in connection with violations of the Safe Doses Act, which prohibits theft of “pre-retail” medical products. Ivan Manuel Valle, 34, of Miami, Daniel Martinez Zamora, 45, of Homestead, Raul Nick Garcia, 52, of Surfside, Ali Saleh, 35, of Miramar, and Jesus Mariano Gutierrez, 51, of Miami, were all sentenced to prison terms by U.S. District Judge Joan A. Lenard in connection with a scheme to steal more than $2.2 million worth of Mucinex cough medicine and $550,000 worth of Similac baby formula.
According to the indictment and documents filed in court, as part of an organized theft ring, 44 pallets of Similac were stolen by the conspirators from a distribution site in Forth Worth, Texas, and more than 131,000 cases of Mucinex were pilfered from a tractor-trailer truck in Mississippi. These pre-retail medical products were then transported by members of the theft ring to South Florida, stored in various locations, and offered for sale to brokers and retailers in and around Miami-Dade County. The defendants worked together to sell and distribute the stolen cargo. Valle and Zamora were brokers who obtained stolen product from others and sold portions of the stolen cargo. Garcia was a co-owner of Tadeo Supermarket in Miami where stolen cargo was sold, and he acted as a buyer and re-seller of stolen cargo using his family business, National Pallet, in Miami, where stolen product was stored. Saleh operated a beauty supply business in Broward County, where he stored stolen product and offered it for sale, and Gutierrez was a broker of the stolen cargo.
The stolen products were originally intended for sale at Wal-Mart and Walgreens stores and other retailers in the Southeastern United States.
Garcia and Zamora were each sentenced to 48 months in prison on September 22, 2014; Valle was sentenced to 60 months in prison and Gutierrez was sentenced to 30 months in prison on August 28, 2014; and, Saleh was sentenced to 34 months in prison on September 4, 2014. The defendants all previously pleaded guilty before Judge Lenard. A sixth defendant, Jorge Nimer Rolo, 47, of Miami, is currently in federal custody in Indiana and is awaiting trial on separate federal charges in the Southern District of Indiana.
The Safe Doses Act, passed by Congress in November, 2012, created a new offense, 18 U.S.C. § 670, which prohibits 1) stealing, or obtaining by fraud or deception, any pre-retail medical product; 2) knowingly and falsely making, altering, forging, or counterfeiting the labeling or documentation of a pre-retail medical product; 3) knowingly possessing or transporting a stolen or fraudulently-obtained pre-retail medical product; and, 4) buying or otherwise obtaining an expired or stolen pre-retail medical product with intent to defraud. Pre-retail medical products such as baby formula and cold medicine are covered by the Act.
Mr. Ferrer commended the investigative efforts of the FBI and FDA-OCI, as part of the Miami Major Theft Task Force. This case is being prosecuted by Assistant U.S. Attorney Jerrob Duffy.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Felon in Possession of Ammunition Sentenced to 77 Months ImprisonmentRead the Press Release
Spokane – Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that Charles Henry Reedy, age 24, was sentenced today after he previously pleaded guilty to being a previously convicted felon in possession of ammunition. United States District Court Judge Thomas O. Rice sentenced Reedy to 77 months imprisonment to be followed by three years of court supervision following his release from Federal prison. During the sentencing hearing Judge Rice addressed Reedy’s extensive criminal history and, after imposing the sentence, told Reedy he hoped to never see him before the court again.
According to information disclosed during the court proceedings, in 2010, Reedy was sentenced to over 23 months imprisonment for Assault in Violation of a Protection Order – Domestic Violence. He was subsequently released from prison and placed on court supervision. Thereafter, on January 16, 2014, Yakima Violent Crimes Task Force agents observed Reedy leaving a residence in a Ford Explorer. At the time, a Washington Department of Corrections warrant for Reedy’s arrest was outstanding. Agents conducted a traffic stop, Reedy was taken into custody, and a search warrant was obtained for the Ford Explorer. A backpack was located on the rear floor board behind the driver’s seat, which contained 400 rounds of CCI .22 caliber long rifle ammunition as well as Reedy’s mail and identification card. Agents with the Bureau of Alcohol, Tobacco, Firearms, and Explosives worked with the Yakima Police Department and determined that Reedy was prohibited from possessing ammunition or firearms. Reedy was subsequently charged Federally with being a previously convicted felon in possession of ammunition.
Michael C. Ormsby said, “Convicted felons, particularly those with domestic violence convictions, who possess ammunition present a significant danger. Local and federal law enforcement officers in the Eastern District of Washington are dedicated to work together to protect our communities from such offenders. This case is just one example of the cooperative and successful efforts by federal law enforcement officers and the Yakima Police Department.”
This investigation was conducted by the Yakima Police Department and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. The case was prosecuted by Alison Gregoire, an Assistant United States Attorney for the Eastern District of Washington.
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