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Tuesday 22 July 2014
Miami-Dade County Resident Pleads Guilty in Identity Theft Schemes Involving Fraudulent Social Security Benefits and Income Tax RefundsRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Thomas Caul, Special Agent in Charge, Social Security Administration (SSA), Office of Inspector General (OIG), Donnell Young, Acting Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), and George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, announce that Thervil Alcinor, 34, of Miami, pled guilty to one count of access device fraud, in violation of Title 18, United States Code, Section 1029(a)(2), and one count of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A. Sentencing is scheduled for September 29, 2014, at 2:00 p.m. At sentencing, Alcinor faces up to ten years in prison for the access device charge, and a mandatory term of two years in prison, consecutive to any other term in prison, for the aggravated identity theft charge.
According to court documents, from January 2013 through May 2014, Alcinor was involved in the use of personal identifying information (names, dates of birth, and social security numbers belonging to real people) to file fraudulent applications for Social Security Retirement Insurance Benefits (RIB) and Social Security Disability Insurance Benefits (DIB), and to file fraudulent income tax returns with the IRS claiming false refunds.
Court documents state that Alcinor was involved in establishing online accounts on the Social Security Administration website, MySSA.gov, for already-existing RIB or DIB beneficiaries to redirect RIB and DIB payments to accounts (often prepaid debit card accounts) controlled by him. Law enforcement identified 945 fraudulently established MySSA accounts, all with similarly concocted fraudulent email addresses. The fraudulent claims resulted in $700,462 in fraudulent RIB and DIB payments.
According to court documents, Alcinor was also involved in the filing of fraudulent tax returns claiming refunds from the IRS which he directed into accounts (often prepaid debit card accounts) controlled by him. Specifically from April 2012 through September 2013, 54 fraudulent income tax refunds, totaling $174,862.20, were identified by H&R Block records as having been deposited into accounts associated with Alcinor. An additional 14 fraudulent tax refunds, totaling $31,137.28, were connected to the scheme by IRS.
Mr. Ferrer commended the investigative efforts of SSA-OIG, IRS-CI and FBI. The case is being prosecuted by Assistant U.S. Attorney Frank R. Maderal.
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.
Member of Newport News Drug Gang Sentenced to 30 Years in PrisonRead the Press Release
NEWPORT NEWS, Va. – Eric Pridgen, 31, of Newport News, Virginia, was sentenced today to 30 years in prison, followed by five years of supervised release, for participating in a conspiracy to distribute narcotics as part of the Thug Relations gang.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Royce E. Curtin, Special Agent in Charge of the FBI’s Norfolk Field Office; Colonel W. Steven Flaherty, Virginia State Police Superintendent; and Richard W. Myers, Chief of Newport News Police, made the announcement after sentencing by U.S. District Judge Raymond A. Jackson.
Pridgen pleaded guilty on March 12, 2014. According to court documents, Pridgen was involved with several other individuals, including his brother Herbert Pridgen, in distributing large quantities of powder cocaine, crack cocaine and marijuana in the Denbigh section of Newport News. This drug dealing involved the use of firearms and often turned violent.
Eric Pridgen was preceded in sentencing by Robbie Bowles, 29, of Newport News, who was sentenced to 20 years in prison for participating in the drug conspiracy and discharging a firearm during a drug trafficking offense; Ronnie Rooks, 29, of Newport News, who received 10 years in prison for the drug conspiracy; and Herbert Pridgen, 27, of Newport News, who received a sentence of 11 years in prison for the drug conspiracy.
This case was investigated by the FBI’s Norfolk Field Office, Virginia State Police and Newport News Police Department. Assistant U.S. Attorney Eric M. Hurt prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:13-cr-54.
Member of Hartford Drug Trafficking Ring Sentenced to More Than 5 Years in Federal PrisonRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that ANDREW MORRISON, also known as “Big Booby,” 25, of Hartford, was sentenced today by U.S. District Judge Michael P. Shea in Hartford to 66 months of imprisonment, followed by four years of supervised release, for his role in a Hartford-based narcotics trafficking ring.
According to court documents and statements made in court, this matter stems from a joint law enforcement investigation headed by the Federal Bureau of Investigation’s Northern Connecticut Violent Crimes Task Force and the Hartford Police Department into gang-related narcotics trafficking in Hartford’s South End. The investigation specifically targeted a heroin and cocaine trafficking organization headed by Angel Rosa, also known as “Little” and “Daddy,” who is a member of the Los Solidos street gang, and his cousin, Angel Rosa, also known as “Mo Betta” and “Fab.” “Little,” supervised the drug trafficking ring, which included several other family members, through fear and intimidation. “Mo Betta” managed the daily operations of the organization, facilitated the delivery and transportation of large quantities of heroin, and supervised numerous drug sellers who distributed heroin and other narcotics in the Zion Street area. At times, “Little” and “Mo Betta” used, or threatened to use, violence to ensure the success of the organization.
MORRISON was one of the principal heroin sellers in the Rosa drug trafficking organization. In addition to working shifts selling substantial quantities of heroin in the Zion Street area, he sometimes brokered deals for heroin with his own source when Mo Betta and Little were having difficulty obtaining the drug from their principal suppliers.
MORRISON was arrested on April 17, 2013. On January 31, 2014, he pleaded guilty to one count of conspiracy to possess with intent to distribute, and to distribute, heroin.
As a result of the investigation, 21 individuals were charged with various federal offenses, and law enforcement officers seized narcotics, one firearm, approximately $230,000 in cash, eight vehicles and jewelry.
Angel Rosa aka “Little” and Angel Rosa aka “Mo Betta” each pleaded guilty to one count of conspiracy to possess with intent to distribute, and to distribute, 100 grams or more of heroin. On May 15, 2014, “Little” was sentenced to 235 months of imprisonment, and on April 29, 2014, “Mo Betta” was sentenced to 165 months of imprisonment.
This matter was investigated by the Federal Bureau of Investigation’s Northern Connecticut Violent Crimes Task Force, which includes members of the Connecticut State Police, Hartford Police Department, East Hartford Police Department, Connecticut Department of Correction and Connecticut National Guard. The Connecticut State Police’s Emergency Services Unit, Hartford Police Department’s Emergency Response Team, Capital Region Emergency Response Team, Drug Enforcement Administration, Homeland Security Investigations and the New Britain, East Hartford, Wethersfield and Manchester Police Departments have provided valuable assistance to the investigation.
The case is being prosecuted by Assistant U.S. Attorneys Brian Leaming and Patrick Caruso.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Maryland Man Sentenced to 20 Years in Prison for Sex Trafficking ConspiracyRead the Press Release
U.S. District Court Judge Paul W. Grimm sentenced Jean Claude Roy, aka Dredd the Don, 31, of Germantown, Maryland, to serve 240 months in prison to be followed by 10 years of supervised release, the Justice Department announced today. A jury convicted Roy on March 19, 2014, of conspiracy to commit sex trafficking by force, fraud and coercion, three counts of interstate transportation for the purpose of prostitution, and one count of witness and evidence tampering.
“The Civil Rights Division is committed to pursuing justice on behalf of vulnerable members of our society,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “This sentence sends a clear message that the United States will not tolerate modern-day slavery and will work tirelessly to restore the rights and dignity of its victims.”
During the trial, victims recounted their fear of Roy, explaining instances of physical and sexual abuse, threats, tattoo branding and Roy’s bragging of beating a murder charge years prior in Massachusetts. “If he could kill a man, who’s gonna care about a prostitute,” said one victim from the witness stand. Witnesses detailed the guns in Roy’s possession and how he prostituted women in Maryland, Virginia and North Carolina.
“Jean Claude Roy preyed on vulnerable young women,” said U.S. Attorney Rod J. Rosenstein for the District of Maryland. “Law enforcement agencies will continue to work to identify and prosecute human traffickers.”
“This case serves as another chilling example of the callous disregard for human life demonstrated by traffickers,” said U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigation’s (HSI) Baltimore Deputy Special Agent in Charge James P. Nagle. “Our special agents will continue pursuing these criminals to ensure they are behind bars where they can no longer exploit the innocent.”
Trial evidence also showed that from Jan. 1 through Jan. 10, 2013, while Roy was in jail on related state charges, he called a family member several times and had that person access online accounts and storage services belonging to Roy and his co-conspirator in order to erase evidence related to these charges.
The jury acquitted Roy of one count of sex trafficking and two counts of attempted sex trafficking by force, fraud and coercion, and for the related counts of brandishing a firearm during a crime of violence.
This case was investigated by the Maryland Human Trafficking Task Force, which was formed in 2007 to discover and rescue victims of human trafficking while identifying and prosecuting offenders. Members include federal, state and local law enforcement, as well as victim service providers and local community members. For more information about the Maryland Human Trafficking Task Force, please visit the task force website.
Report suspected instances of human trafficking to ICE HSI’s tip line at 866-DHS-2ICE (1-866-347-2423) or by completing its online tip form. Both are staffed around the clock by investigators.
This case was investigated by ICE HSI Baltimore and the Montgomery County Police Department. Assistant U.S. Attorney Kristi N. O’Malley and Trial Attorney William E. Nolan of the Civil Rights Division’s Human Trafficking Prosecution Unit prosecuted the case.
Manitowoc Man Sentenced to Prison for Wire Fraud and Tax EvasionRead the Press Release
United States Attorney James L. Santelle announced that on July 18, 2014, Paul LaChappelle (age: 41), of Manitowoc, was sentenced in federal court to two years in prison and ordered to make restitution to his former employer, Nemschoff Chairs, Inc., in the amount of $520,000. In April 2014, LaChappelle pleaded guilty to wire fraud and tax evasion.
LaChappelle was previously employed as a maintenance technician at Nemschoff’s Sheboygan manufacturing facility. Using this position, LaChappelle entered into an arrangement with a Florida business under which LaChappelle would cause Nemschoff to order replacement parts for machinery LaChappelle serviced from the Florida business. The Florida business would obtain the parts from LaChappelle, who simply stole the parts from Nemschoff’s inventory. LaChappelle was paid one-half of the price Nemschoff paid the Florida business for the parts. During the period from April 2009 through December 2011, Nemschoff paid the Florida business more than $500,000 for these replacement parts and LaChappelle received more than $268,000 for the parts he supplied.The tax evasion charge was based on LaChappelle’s failure to report the income he received as part of his scheme, as well as the fact that he claimed fictitious business expenses on the tax returns he filed for the years 2008 through 2011. As a result, LaChappelle fraudulently paid no federal income taxes for these years.
This case was investigated by the Internal Revenue Service Criminal Investigation in conjunction with the Sheboygan Police Department. The case was prosecuted by Assistant United States Attorney Matthew L. Jacobs.Long Island Doctor Sentenced to 10 Years’ Imprisonment for Conspiracy to Distribute Oxycodone and Distribution of OxycodoneRead the Press Release
Earlier today, at the federal courthouse in Central Islip, New York, Long Island doctor Leonard I. Stambler was sentenced to 10 years in prison by United States District Court Judge Joseph F. Bianco. Stambler was convicted by a jury in October 2013 following three weeks of trial of conspiracy to distribute oxycodone and distribution of oxycodone, a highly addictive prescription pain killer, in connection with prescriptions that he provided to patients outside the scope of his professional practice and not for any medical purpose. At the time of the verdict, the defendant’s bail was revoked, and he was ordered detained pending sentencing.
The conviction was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York; James J. Hunt, Acting Special Agent-in-Charge, Drug Enforcement Administration (DEA), New York; Thomas C. Krumpter, Acting Commissioner, Nassau County Police Department (NCPD); Joseph A. D’Amico, Superintendent, New York State Police (NYSP); and Shantelle P. Kitchen, Acting Special Agent-in-Charge, Internal Revenue Service Criminal Investigation, New York (IRS).
“Rather than ‘Do No Harm,’ Dr. Stambler acted as a drug dealer, putting thousands of oxycodone pills onto the streets of Long Island for no valid medical reason, even going so far as to drive his patient-friends to a drug deal,” stated United States Attorney Lynch. “This conviction and sentence should serve as a warning to any health care professionals engaged in such conduct that in addition to losing their license to practice medicine, they will face prison for such conduct.” Ms. Lynch extended her grateful appreciation to each of the law enforcement agencies for their assistance in this case.
At trial, the government’s evidence established that Stambler provided prescriptions for hundreds of oxycodone pills to two of his patients without a legitimate medical purpose and outside the course of a professional medical practice, and also conspired with those patients and assisted them in the sale of pills that he prescribed. On November 21, 2011, investigators with the DEA Task Force observed Stambler driving his patient, Christopher Adams, to a pharmacy in East Rockaway, New York, where Stambler and Adams filled a prescription that Stambler had written in the name of Adams’s girlfriend, Nancy Cook. As investigators watched, Stambler then drove Adams to a nearby location to meet with a third individual where some of the oxycodone pills were exchanged for cash. Investigators stopped Stambler’s vehicle shortly after the drug deal. On a separate occasion, Stambler drove Cook, who was also Stambler’s patient, to a home in East Rockaway where she sold oxycodone pills to the same individual involved in the November 21, 2011, drug deal. Both Adams and Cook testified at trial about Stambler’s participation in the drug transactions as well as their own destructive addiction to oxycodone.
Oxycodone is a scheduled controlled substance that may be dispensed by medical professionals only for a legitimate medical purpose in the usual course of a doctor’s professional practice. It is a powerful and highly addictive drug and is increasingly abused because of its potency when crushed into a powder and ingested, leading to a heroin like euphoria.
Stambler’s conviction is the latest in a series of federal prosecutions by the United States Attorney’s Office for the Eastern District of New York as part of the Prescription Drug Initiative. In January 2012, this Office and the DEA, in conjunction with the five District Attorneys in this jurisdiction, the Nassau and Suffolk County Police Departments, the New York City Police Department, and New York State Police, along with other key federal, state, and local government partners, launched the Prescription Drug Initiative to mount a comprehensive response to what the United States Department of Health and Human Services’ Center for Disease Control and Prevention has called an epidemic increase in the abuse of so-called opioid analgesics. So far, the Prescription Drug Initiative has brought over 160 federal and local criminal prosecutions, including the prosecution of 15 health care professionals, taken civil enforcement actions against a hospital, a pharmacy, and a pharmacy chain, removed prescription authority from numerous rogue doctors, and expanded information-sharing among enforcement agencies to better target and pursue drug traffickers. The Initiative also is involved in an extensive community outreach program to address the abuse of pharmaceuticals.
The government’s case was prosecuted by Assistant United States Attorney Allen Bode.
The Defendant:
Name: LEONARD I. STAMBLER
Age: 63
Residence: Baldwin Harbor, NY
Lapwai Man Pleads Guilty to Theft of Government PropertyRead the Press Release
COEUR D’ALENE – Isaac Kash Kash, 26, of Lapwai, Idaho, pleaded guilty today in federal court to one count of theft of government property, U.S. Attorney Wendy J. Olson announced.
According to court documents, the defendant unlawfully used United States government- issued fleet credit cards for his personal use. The defendant had access to fleet credit cards because he was a seasonal employee for the Nez Perce Fisheries Department located in Orofino, Idaho. Due to the defendant’s criminal activity, the government incurred a loss of more than $5,000.
Theft of government property is punishable by not more than one year in prison, a maximum fine of $100,000, and up to one year of supervised release, or five years of probation.
Sentencing is set for October 14, 2014, before U.S. District Judge Edward J. Lodge at the federal courthouse in Coeur d’Alene.
The case was investigated by the General Services Administration and Nez Perce Tribal Police.
Lafayette Man Charged for Bomb Threat, Bank RobberyRead the Press Release
LAFAYETTE, La. –A Lafayette man suspected of making a bomb threat in the city of Lafayette has been arrested and charged for the bomb threat and an attempted bank robbery, U.S. Attorney Stephanie A. Finley announced today.
Devin Haywood, 30, of Lafayette, was charged in a federal criminal complaint today before U.S. Magistrate Judge Patrick Hanna with one count of using a facility in interstate commerce to willfully make a threat or maliciously convey false information and one count of attempted bank robbery. After the arraignment hearing, he was detained pending trial.
If convicted, the defendant faces 10 years in prison and three years of supervised release for the bomb threat charge. He faces 20 years in prison and five years of supervised release for the attempted bank robbery charge. Both charges carry a fine of up to $250,000.
The FBI, ATF, U.S. Marshals Service, Louisiana State Police, Lafayette Police Department, Lafayette Sheriff’s Office, and the University Louisiana at Lafayette Police Department investigated the case.A complaint is merely an accusation and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
Justice Department to Announce Results and Next Steps in Investigation of Newark Police DepartmentRead the Press Release
The Department of Justice Civil Rights Division and the U.S. Attorney’s Office for the District of New Jersey will announce the results and next steps following its investigation into the Newark Police TODAY, TUESDAY, JULY 22, 2014, at 12:00 p.m. EDT, at the Newark office of the U.S. Attorney for the District of New Jersey. The investigation, opened in May 2011, looked at allegations of use of excessive force and discriminatory policing among other issues.
WHO: Acting Assistant Attorney General for the Civil Rights Division Jocelyn Samuels, U.S. Attorney Paul J. Fishman for the District of New Jersey, Newark Mayor Ras Baraka, and Newark Police Director Eugene Venable
WHAT: Press Conference to announce results of the Justice Department’s investigation into the Newark Police Department
WHEN: TUESDAY, JULY 22, 2014, at 12:00 p.m. EDT
WHERE: U.S. Attorney’s Office for the District of New Jersey970 Broad Street, Seventh Floor, Newark, New Jersey, OPEN PRESS
NOTE: All media must present government-issued photo I.D. (such as driver’s license) as well as valid media credentials. Press inquiries regarding logistics should be directed to Rebekah Carmichael or Matt Reilly at 973-645-2888 or [email protected].
Justice Department Reaches Agreement with City of Newark, New Jersey, to Address Unconstitutional Policing in Newark Police DepartmentRead the Press Release
The Justice Department today announced it has reached an agreement with the city of Newark, New Jersey, to address a pattern and practice of unconstitutional policing by the Newark Police Department (NPD). The agreement follows a joint investigation by the Justice Department’s Civil Rights Division and the U.S. Attorney’s Office for the District of New Jersey, the results of which were also released today.
The findings, detailed in a report provided to the city and to NPD leadership, document the NPD’s pattern or practice of constitutional violations in its stop and arrest practices; its response to individuals exercising their rights under the First Amendment; its use of force; and through theft by officers. The investigation also revealed deficiencies in NPD systems that are designed to prevent and detect misconduct.
The city of Newark cooperated with the investigation, which began on May 9, 2011, and has agreed to enter into a court-enforceable, independently monitored agreement to reform the NPD to ensure constitutional policing. The terms of the agreement are outlined in the agreement in principle released today. Among other things, the NPD must continue to develop and implement improvements to its stop, arrest and force policies and procedures, and to train its officers on how to conduct effective and constitutional policing. The NPD also must implement systems that ensure accountability, commit to building police-community partnerships and improve the quality of policing throughout the city.
“Our investigation uncovered troubling patterns in stops, arrests and use of force by the police in Newark. With this agreement, we’re taking decisive action to address potential discrimination and end unconstitutional conduct by those who are sworn to serve their fellow citizens,” said Attorney General Eric Holder. “This action reaffirms the Justice Department’s commitment to working with our law enforcement partners in order to ensure the highest standards of integrity and professionalism. Under today’s agreement, Newark police officials are taking the first in a series of important steps to restore public trust in their department and ensure both the safety and the civil rights of Newark residents.”
“Today the city of Newark has taken a bold step toward ensuring constitutional policing that better serves all of Newark’s residents,” said Acting Assistant Attorney General for the Civil Rights Division Jocelyn Samuels. “The Department of Justice report released today makes clear the depth and breadth of the challenges Newark faces in reforming its police department; but the agreement in principle provides a roadmap for reform and underscores the shared determination of the city of Newark and the Department of Justice to making this reform real and sustainable.”
“The people of Newark deserve to be safe, and so do the thousands who come here to work, to learn, and to take advantage of all the city has to offer,” said U.S. Attorney Fishman. “They also need to know the police protecting them are doing that important – and often dangerous – work while respecting their constitutional rights. The Justice Department has a long history of making sure of that, and today we have the commitment of Newark's mayor and the leadership of the police department to make the department the one that the city deserves.”
During the investigation, the Justice Department reviewed thousands of NPD documents, including written policies and procedures, documentation of stops, searches and arrests, internal investigation files and use of force reports and reviews. Attorneys and investigators also interviewed NPD officers, supervisors and command staff, as well as city officials, and met with hundreds of community members and local advocates.
As the report describes, the Justice Department found reasonable cause to believe that the NPD has engaged in a pattern or practice of unconstitutional stops in violation of the Fourth Amendment. Specifically, NPD officers failed to articulate sufficient justification for nearly 75 percent of pedestrian stops. NPD officers also disproportionately stopped black people relative to their representation in Newark’s population. Although the NPD’s reports were insufficient to allow the Justice Department to determine whether this disparity was the result of intentional discrimination or was otherwise unlawful, the report urges the city of Newark and NPD to improve its collection and analysis of its stop, search and arrest data to facilitate a more thorough analysis of the racial and ethnic impacts of NPD’s police practices and to take steps to eliminate avoidable disparities.
Through the course of the investigation, the Justice Department also found that NPD officers have detained and arrested individuals who lawfully objected to police actions or behaved in a way that officers perceived as disrespectful, in violation of the First Amendment.
In addition, the Justice Department found cause to believe that the NPD engaged in a pattern or practice of the use of excessive force. The NPD has been unable to make reliable conclusions about whether a particular use of force was reasonable due to substantial underreporting and inadequate investigation of the use of force by NPD officers. Nonetheless, of the incidents reviewed as part of the Justice Department’s investigation, more than 20 percent of NPD officers reported use of force that appeared unreasonable.
The investigation also found a pattern or practice of theft of citizens’ property by NPD officers in violation of the Fourth and 14 th Amendments, including by officers in NPD’s specialized units, such as the narcotics and gang units, and at NPD’s prisoner processing unit.
The Justice Department’s report details other inadequacies that contributed to a pattern of constitutional violations. Deficiencies were found in Internal Affairs (IA) processes, in investigations reviewing use of force and complaints regarding officer misconduct, in supervision and management, and in the training of officers and IA investigators.
The Justice Department conducted its investigation jointly through the Special Litigation Section of the Civil Rights Division and the U.S. Attorney’s Office for the District of New Jersey, with the assistance of law enforcement and statistics experts.
Both the report and the agreement in principle, along with summaries of each, will be available on the Civil Rights Division website .
Justice Department Reaches Agreement with City of Newark, New Jersey, to Address Unconstitutional Policing in Newark Police DepartmentRead the Press Release
NEWARK, N.J. - The Justice Department today announced it has reached an agreement with the city of Newark, New Jersey, to address a pattern and practice of unconstitutional policing by the Newark Police Department (NPD). The agreement follows a joint investigation by the U.S. Attorney’s Office for the District of New Jersey and the Justice Department’s Civil Rights Division, the results of which were also released today.
The findings, detailed in a report provided to the city and to NPD leadership, document the NPD’s pattern or practice of constitutional violations in its stop and arrest practices; its response to individuals exercising their rights under the First Amendment; its use of force; and through theft by officers. The investigation also revealed deficiencies in NPD systems that are designed to prevent and detect misconduct.
The city of Newark cooperated with the investigation, which began on May 9, 2011, and has agreed to enter into a court-enforceable, independently monitored agreement to reform the NPD to ensure constitutional policing. The terms of the agreement are outlined in the agreement in principle released today. Among other things, the NPD must continue to develop and implement improvements to its stop, arrest and force policies and procedures, and to train its officers on how to conduct effective and constitutional policing. The NPD also must implement systems that ensure accountability, commit to building police-community partnerships and improve the quality of policing throughout the city.
“Our investigation uncovered troubling patterns in stops, arrests and use of force by the police in Newark. With this agreement, we’re taking decisive action to address potential discrimination and end unconstitutional conduct by those who are sworn to serve their fellow citizens,” said Attorney General Eric Holder. “This action reaffirms the Justice Department’s commitment to working with our law enforcement partners in order to ensure the highest standards of integrity and professionalism. Under today’s agreement, Newark Police officials are taking the first in a series of important steps to restore public trust in their Department and ensure both the safety and the civil rights of Newark residents.”
“The people of Newark deserve to be safe, and so do the thousands who come here to work, to learn, and to take advantage of all the city has to offer,” said U.S. Attorney Fishman. “They also need to know the police protecting them are doing that important – and often dangerous – work while respecting their constitutional rights. The Justice Department has a long history of making sure of that, and today we have the commitment of Newark’s mayor and the leadership of the police department to make the department the one that the city deserves.”
“Today the City of Newark has taken a bold step toward ensuring constitutional policing that better serves all of Newark’s residents,” said Acting Assistant Attorney General for the Civil Rights Division Jocelyn Samuels. “The Department of Justice report released today makes clear the depth and breadth of the challenges Newark faces in reforming its police department; but the agreement in principle provides a roadmap for reform and underscores the shared determination of the City of Newark and the Department of Justice to making this reform real and sustainable.”
During the investigation, the Justice Department reviewed thousands of NPD documents, including written policies and procedures, documentation of stops, searches and arrests, internal investigation files and use of force reports and reviews. Attorneys and investigators also interviewed NPD officers, supervisors and command staff, as well as city officials, and met with hundreds of community members and local advocates.
As the report describes, the Justice Department found reasonable cause to believe that the NPD has engaged in a pattern or practice of unconstitutional stops in violation of the Fourth Amendment. Specifically, NPD officers failed to articulate sufficient justification for nearly 75 percent of pedestrian stops. NPD officers also disproportionately stopped black people relative to their representation in Newark’s population. Although the NPD’s reports were insufficient to allow the Justice Department to determine whether this disparity was the result of intentional discrimination or was otherwise unlawful, the report urges the city of Newark and NPD to improve its collection and analysis of its stop, search and arrest data to facilitate a more thorough analysis of the racial and ethnic impacts of NPD’s police practices and to take steps to eliminate avoidable disparities.
Through the course of the investigation, the Justice Department also found that NPD officers have detained and arrested individuals who lawfully objected to police actions or behaved in a way that officers perceived as disrespectful, in violation of the First Amendment.
In addition, the Justice Department found cause to believe that the NPD engaged in a pattern or practice of the use of excessive force. The NPD has been unable to make reliable conclusions about whether a particular use of force was reasonable due to substantial underreporting and inadequate investigation of the use of force by NPD officers. Nonetheless, of the incidents reviewed as part of the Justice Department’s investigation, more than 20 percent of NPD officers reported use of force that appeared unreasonable.
The investigation also found a pattern or practice of theft of citizens’ property by NPD officers in violation of the Fourth and 14th Amendments, including by officers in NPD’s specialized units, such as the narcotics and gang units, and at NPD’s prisoner processing unit.
The Justice Department’s report details other inadequacies that contributed to a pattern of constitutional violations. Deficiencies were found in Internal Affairs (IA) processes, in investigations reviewing use of force and complaints regarding officer misconduct, in supervision and management, and in the training of officers and IA investigators.
The Justice Department conducted its investigation jointly through the Special Litigation Section of the Civil Rights Division and the U.S. Attorney’s Office for the District of New Jersey, with the assistance of law enforcement and statistics experts.
Both the report and the agreement in principle, along with summaries of each, are attached. For more information about the Civil Rights Division, please visit the division website.
Federal civil rights complaints specific to New Jersey can be directed to the U.S. Attorney’s Office civil rights complaint hotline at 855-281-3339 or can be filed by filling out a complaint form at http://go.usa.gov/9nzW.
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Agreement in Principle
NPD Fact Sheet
NPD Findings Report
Monitor SolicitationAgreement in Principle - Español
Agreement in Principle - PortugueseJury Convicts KC Man of Firearms ViolationsRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Kansas City, Mo., man was convicted in federal court today of illegally possessing a Street Sweeper shotgun and a stolen handgun.
Ronald F. White, Jr., 32, of Kansas City, was found guilty of both counts of a Dec. 11, 2013, federal indictment.
White was convicted of possessing a Street Sweeper semiautomatic, drum-fed, 12-gauge shotgun that was not registered to him, and of possessing a Romarm/Cugir 7.62x39-caliber semiautomatic handgun that he knew had been stolen. The firearms were discovered by police officers when they executed a search warrant at the residence of White’s parents, where he sometimes stayed, on Oct. 31, 2013.
Following the presentation of evidence, the jury in the U.S. District Court in Kansas City, Mo., deliberated for about an hour before returning the guilty verdicts to U.S. District Judge Dean Whipple, ending a trial that began Monday, July 21, 2014.
Under federal statutes, White is subject to a sentence of up to 20 years in federal prison without parole, plus a fine up to $260,000. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Joseph M. Marquez and Special Assistant U.S. Attorney Jeff Q. McCarther. It was investigated by the Kansas City, Mo., Police Department, the Independence, Mo., Police Department, and the Bureau of Alcohol, Tobacco, Firearms and Explosives.Judge Sentences Lancaster Man to 10 Years in Child Exploitation CaseRead the Press Release
Richard Haines, Jr., 60, of Lancaster, PA, was sentenced today to 10 years in prison for possession of child pornography and enticing a minor to engage in sexually explicit conduct so that he could take pictures of the conduct and with possession of child pornography. He pleaded guilty on September 4, 2013. Haines took photos of a female relative in various stages of undress. He also, while on bail awaiting sentencing, tried to influence the victim to testify on his behalf at sentencing. His bail was revoked and he has been in custody since October 10, 2013.
In addition to the prison term, U.S. District Court Judge James Knoll Gardner ordered restitution of $9338, a $10,000 fine, a lifetime of supervised release and a $200 special assessment.The case was investigated by the Federal Bureau of Investigation and was prosecuted by Assistant United States Attorney Michelle Rotella.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Illegal Alien Sentenced to 4 Years and 9 Months for Selling Methamphetamine, Possessing False DocumentsRead the Press Release
FRESNO, Calif. — Israel Garrido-Hernandez, 24, of Fresno, was sentenced Monday by United States District Judge Lawrence J. O'Neill to four years and nine months in prison for possession of methamphetamine with intent to distribute and possession of document-making implements, United States Attorney Benjamin B. Wagner announced.
According to court documents, in April 2013, Garrido-Hernandez possessed with the intent to distribute methamphetamine. Between January and April 2013, he possessed equipment to make false documents that appeared to be made under the authority of the United States, such as false legal permanent resident cards (“green cards”) and false Social-Security cards.
This case was the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). Assistant United States Attorney Mia A. Giacomazzi prosecuted the case.
Houston Women Charged in Bank Fraud/Identity Theft CaseRead the Press Release
HOUSTON - Tonya Beverly, 38, and Leatrice Reynaud, 43, both of Houston, have been arrested following the return of a 20-count indictment alleging conspiracy to commit bank fraud, bank fraud and aggravated identity theft, announced United States Attorney Kenneth Magidson.
Both are expected to make their initial appearance before U.S. Magistrate Judge Frances Stacy today.
The indictment was returned under seal July 16, 2014, and unsealed yesterday upon their arrest.
Beverly and Reynaud allegedly created at least 33 false and fraudulent USAA customer profiles, which included checking and savings accounts, using the identification information of individuals without their knowledge or permission. According to the indictment, Beverly and Reynaud linked the false and fraudulent USAA accounts with the real bank accounts of the victims whose identification information was used and transferred money from the real accounts into the false and fraudulent USAA accounts.
Further, the indictment alleges that the two received and used debit cards issued to the false and fraudulent USAA accounts to withdraw cash from ATM machines and make purchases, including plane tickets. In addition to the conspiracy and bank fraud, the indictment alleges Beverly and Reynaud unlawfully used the identification of at least eight individuals as part of their bank fraud scheme.
The indictment includes a notice of forfeiture in the amount of $106,383 in allegedly unlawful proceeds.
In a related case, co-conspirator Demetria Jones, 40, also of Houston, was charged with conspiracy to commit bank fraud. The criminal information charging Jones was filed yesterday in Houston federal court. She is expected to surrender to authorities Wednesday, July 23, 2014.
A conviction for conspiracy or bank fraud carries a possible punishment of up to 30 years in federal prison and/or a possible $1 million fine. If convicted of aggravated identity theft, Beverly and Reynaud further face a $250,000 fine and a mandatory two years in federal prison which must be served consecutively to any other prison term imposed.
The investigation was conducted by the United States Secret Service. Assistant United States Attorney Julie Redlinger is prosecuting the case.
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.Ft. Campbell Military Base Resident Guilty of Wantonly Abusing A Child Under the Age of 12Read the Press Release
– Child was malnourished and in gross need of medical care for upper torso burns
PADUCAH, Ky. – A Ft. Campbell military base resident pleaded guilty in U.S. District Court today to charges of wantonly abusing her child, who at the time was under the age of 12, announced David J. Hale, United States Attorney for the Western District of Kentucky.
According to the plea agreement, Shanika D’June Pickens, a/k/a Shanika Campbell, age 28, pleaded guilty to a two count Indictment charging that she wantonly abused the child by failing to provide the child professional medical attention for burns and for failing to provide the child adequate food and nutrition that resulted in his medical diagnosis of malnutrition.
Specifically, Campbell had custody of her 3 children, including the victim in this case, known as K.V.P., who was under 12 years of age, while living on Ft. Campbell, Kentucky military base, located in Christian County, Kentucky. Between January 1, 2011 and September 30, 2011, the victim received burns to his right side and back areas. At that time, Campbell admits she was aware of the burns and did not seek professional medical attention that was available on Ft. Campbell military base for her family. Campbell further admits that her failure to seek medical attention for the burns was wanton because she was aware of and consciously disregarded a substantial and unjustifiable risk that the child would suffer a serious bodily condition and ultimately experienced more pain and scarring to his back and right side areas than he would have experienced had he received timely and competent medical attention. The risk of that harm to K.V.P. was of such nature and degree that the disregard of that risk constitutes a gross deviation from the standard of conduct that a reasonable person would observe in the situation.
Further, between October 1, 2011 and January 30, 2012, Campbell failed to provide adequate food and nutrition to K.V.P. That condition resulted in his hospitalization at Vanderbilt University Hospital in Nashville, Tennessee, between January 28, 2012 and February 6, 2012 during which he was diagnosed with, among other conditions, malnutrition. Campbell admits that her failure to provide adequate food and nutrition to K.V.P was wanton because she was aware of and consciously disregarded a substantial and unjustifiable risk that constitutes a gross deviation from the standard of conduct that a reasonable person would observe in the situation.
If convicted at trial, Campbell faced a sentence of no more than 10 years in prison, a fine of $500,000 and a three year period of supervised release. Campbell is scheduled for sentencing before Senior U.S. District Judge Thomas B. Russell on November 13, 2014, in Paducah.
This case is being prosecuted by Assistant United States Attorney David Sparks and is being investigated by the Federal Bureau of Investigation (FBI) and Ft. Campbell, Kentucky, 502nd Military Police Battalion (CID).
Four Guilty in Conspiracy to Defraud Lowe'sRead the Press Release
NASHVILLE, Tenn.- July 22, 2014- Four Kentucky residents pleaded guilty yesterday to conspiring to defraud Lowe’s Companies, Inc., announced David Rivera, United States Attorney for the Middle District of Tennessee. Joe Fuqua, 38, Michael Gregory, 39, and Charles Ragar, 49, all of Franklin, KY, and Robert Trammel, 40, of Bowling Green, KY, each pleaded guilty to conspiring to commit wire fraud in hearings before Judge Todd J. Campbell of the U.S. District Court for the Middle District of Tennessee.
At their hearings, each of the four defendants admitted taking part in a conspiracy to establish Lowe’s credit accounts, bounce checks to the accounts, and thereafter purchase merchandise from Lowe’s retail stores using the fraudulent accounts. Each defendant also admitted to selling a portion of the merchandise obtained fraudulently from Lowe’s to a co-conspirator in exchange for a percentage of the actual retail value of the merchandise. Altogether, members of the conspiracy made fraudulent purchases exceeding $191,000 at 14 Lowe’s stores across Tennessee and Kentucky.
On April 16, 2014, a federal grand jury sitting in the Middle District of Tennessee indicted Fuqua, Gregory, Ragar, Trammel, along with four others, in connection with the scheme to defraud Lowe’s. They will be sentenced by Judge Campbell on October 17, 2014. Each defendant faces a maximum sentence of 20 years in prison.
Joseph Marty Jones, 46, of Franklin, KY, Ronnie Shubin, 30, of Springfield, TN, and Kevin Pierce, 28, of Castalian Springs, TN, were also indicted on one count of conspiracy to commit wire fraud, while John Brown, 24, of Russellville, KY was indicted on one count of conspiracy to commit wire fraud and one count of wire fraud. These defendants are awaiting trial.
An indictment is merely an accusation and is not evidence of guilt. Those defendants who have not pleaded guilty are presumed innocent unless and until proven guilty in a court of law.
The case was investigated by the Federal Bureau of Investigation and the Springfield, Tennessee Police Department. The United States is represented by Assistant U.S. Attorney William F. Abely.
Four Defendants Indicted for Their Participation in Orange County-Based Loan Modification Scam Targeting Distressed HomeownersRead the Press Release
LOS ANGELES – Federal agents this morning arrested three defendants who worked at Orange County businesses that allegedly offered bogus loan modification programs to financially distressed homeowners. As a result of the fraudulent scheme allegedly run out of U.S. Homeowners Relief and several related entities, hundreds of financially distressed homeowners across the United States lost millions of dollars, and many victims also lost their homes in subsequent foreclosure proceedings.
The three defendants taken into custody this morning were among four defendants named in a federal indictment following an investigation by the United States Postal Inspection Service, the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) and IRS - Criminal Investigation.
According to the indictment, the four defendants operated a series of telemarketing “boiler rooms” that pitched loan modification services to distressed homeowners in the wake of the financial collapse in 2008. The defendants operated offices in Irvine, Santa Ana, Newport Beach, Garden Grove and Westminster under a series of company names from late 2008 to early 2010. Initially called Greenleaf Modify, they subsequently used the names U.S. Homeowners Relief, Waypoint Law Group and, finally, American Lending Review. The defendants would shut down each company name once their businesses attracted too many consumer complaints at the Better Business Bureau or attracted attention from state regulators such as the California Department of Justice.
The defendants and their associates used a consistent sales pitch throughout the scheme. According to the indictment, their advertising materials and telemarketers promised distressed mortgage holders that after paying advance fees ranging from about $1,450 to approximately $4,200, homeowners were highly likely to obtain a long-term modification to their current mortgage obligation, meaning they would have a lower monthly payment, an interest rate reduced to as low as 2 percent, and/or a reduction of principal. Many consumers were falsely told that their up-front money would be refunded if the promised loan modification failed to materialize.
The companies’ marketing materials implied that they were affiliated with a government program, sometimes making specific references to actual government websites, the indictment alleges. Telemarketers associated with the companies also told consumers that their mortgage relief services were part of the “Obama Act.” The defendants claimed in writing that one or more of the entities were licensed California real estate brokers and that payments would be placed in a trust account, not to be withdrawn until loan modification services were actually performed. The defendants often claimed that specific attorneys were assigned to work on consumers’ individual cases.
According to the indictment, all of the defendants’ claims were false and/or materially misleading. The vast majority of the hundreds of victims received no favorable loan modifications as per promises made by the defendants. Several of the victims learned from their mortgage lenders that the defendants’ companies had never made any contacts on the consumers’ behalf. The defendants’ companies were neither licensed real estate brokers, nor were they affiliated with any government program. The consumers’ funds were generally spent on the defendants themselves, on payments to sales people and other business expenses, and were not placed in trust accounts as promised. While the defendants paid attorneys to write substantially identical form letters to some lenders, the attorneys did not give personalized attention to the individual victims. The defendants routinely used stalling tactics or simply ignored consumers’ repeated demands for refunds after the customers did not receive their promised loan modifications.
The four defendants named in the indictment are:
Samuel Paul Bain, who also used the name Paul Bain, 35, of Tustin, an owner and principal of the businesses, who is currently in state custody;
Aminullah Sarpas, who also used the names Amin Sarpas and David Sarpas, 32, of Irvine, California, an owner and principal of the businesses, who was arrested this morning;
Damon Grant Carriger, 36, of Corona, California, the principal sales manager, who was arrested this morning; and
Louis Saggiani, 64, of Huntington Beach, California, the manager and chief accountant for the businesses, who was arrested this morning.
The defendants who were arrested this morning are scheduled to be arraigned this afternoon in United States District Court in Los Angeles.
The defendants are charged in a 33-count indictment. All four defendants are charged with conspiracy, 21 counts of mail fraud and two counts of wire fraud. Bain, Sarpas and Saggiani are charged in an additional five counts of mail fraud and two counts of wire fraud. Bain is also charged with two counts of money laundering.
The conspiracy count carries a statutory maximum penalty of five years in prison, while each of the mail fraud, wire fraud and money laundering charges carry a statutory maximum penalty of 20 years in prison.An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty in court.
Release No. 14-096
Four Arrested on Bank Fraud and ConspiracyRead the Press Release
An indictment was unsealed earlier today charging individuals with bank fraud and conspiracy arising from a scheme to take advantage of plans by an all-girls high school in Hempstead, New York, to expand its campus and build an athletic field for students.
The defendants, two couples, including a real estate attorney and the officer of a real property corporation, were arrested earlier today by special agents of the Federal Bureau of Investigation and will be arraigned this afternoon before United States Magistrate Judge William D. Wall at the United States Courthouse in Central Islip, New York. If convicted, each defendant faces up to 30 years of imprisonment, fines, and the forfeiture of $539,000 in allegedly illegal profits arising from the scheme.1
The charges and arrests were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, and George Venizelos, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI).
As set forth in the indictment, defendants Sofia Atias, Joseph Atias, and Nicholas Pellegrini conspired to defraud Bank of America of over half a million dollars by fraudulently avoiding foreclosure on a home through a fraudulent “short sale” of the property to a straw buyer -- defendant and co-conspirator Paula Berckhoff, also known as “Paula Pellegrini” -- and then profiting from the home’s re-sale or “flip” to Sacred Heart Academy, a Catholic all-girls high school that paid the conspirators almost $1 million for the property to accomplish long-sought plans to improve and expand its facilities.
Early in 2011, defendant Sophia Atias had defaulted on some $750,000 in a mortgage and home equity loan secured by a home she owned at 83 Cathedral Avenue, Hempstead, New York, which sat adjacent to the high school. As Bank of America began foreclosure proceedings, defendants Sophia Atias, Joseph Atias, and Nicholas Pellegrini, acting as the couple’s attorney, negotiated with representatives of Sacred Heart Academy and ultimately won a commitment from the school to buy the property for $925,000 -- an amount that would have been enough to repay the Atias’ debts to the bank.
Instead, the defendants allegedly conspired to induce Bank of America to agree to a short sale of the Cathedral Avenue property. Short sales are an alternative to lengthier and often costly foreclosure proceedings. In a short sale, a bank agrees to accept whatever price a defaulting borrower can get on the immediate or short sale of a property in foreclosure. As the bank did here, lenders may also release the borrower from any obligation to repay any remaining balances owed on the original mortgage or loans.
Knowing that Sacred Heart Academy had already agreed to buy the Cathedral Avenue home for $925,000, the defendants nonetheless induced Bank of America to agree to a short sale of the house for only $480,000 to Jefferson Real Property Corporation, whose secretary and treasurer was defendant Nicholas Pellegrini’ s wife. As part of their agreement with the bank, Mrs. Pellegrini, using the name Paula Berckhoff, and Mrs. Atias, both falsely represented that neither would receive any undisclosed proceeds from the transaction and further claimed that the short sale was not an attempt to “flip” or use “straw buying” to avoid repayment of Atias’ debt.
In fact, as charged in the indictment, several months after the fraudulent short sale, the Atiases and Pellegrinis did re-sell or “flip” the Cathedral Avenue home to Sacred Heart Academy for the previously agreed price of $925,000. Given the fraudulent inducement to accept the short sale, Bank of America was defrauded of almost $540,000.
“Through a web of lies and false documents, the defendants took advantage of a school’s desires to improve its students’ athletic facilities, lied to win concessions from a bank, and then lied again by ‘flipping’ the property and defrauding the bank of over half a million dollars. This is not a case about tough bargaining. This is fraud, pure and simple,” stated United States Attorney Lynch.
FBI Assistant Director-in-Charge Venizelos stated, “As alleged in the indictment, while the defendants did not brandish a weapon, they stole over half a million dollars from Bank of America based upon their false misrepresentations and filing of false documents with the victim-lender. Bank fraud burdens lenders with bad loans and weakens our financial markets. Individuals who engage in this criminal activity should be reminded that they will be vigorously investigated and held accountable.”
The government’s case is being prosecuted by Assistant United States Attorney Charles P. Kelly.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency task force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.
The Defendants:
Name: SOFIA ATIAS
Age: 44 years old
Residence: Great Neck, NY
Name: JOSEPH ATIAS
Age: 50 years old
Residence: Great Neck, NY
Name: NICHOLAS A. PELLEGRINI
Age: 51 years old
Residence: Garden City, NY
Name: PAULA BERCKHOFF
Age: 34 years old
Residence: Garden City, NY
__________________________________________________________________________
1 The charges in the indictment are merely allegations, and the defendants are presumed innocent unless and until proven guilty.
Former Waltham Police Officer Sentenced for Child Pornography ChargesRead the Press Release
BOSTON – A former Waltham Police Department police officer was sentenced today on child pornography charges.
Paul Manganelli, 48, of Waltham, was sentenced by U.S. District Judge F. Dennis Saylor IV to 60 months in prison to be followed by five years of supervised release. Upon release, Manganelli must register as a sex offender. In May 2014, Manganelli pleaded guilty to possession of child pornography. Manganelli was a police officer at Waltham Police Department until after his arrest in March 2013.
Manganelli possessed visual depictions of minors engaged in sexually explicit conduct, including females between the ages of approximately six to 10-years-old. Manganelli engaged in substantial trading activity via email. In March 2013, federal agents discovered Manganelli in possession of more than 850 images and 40 videos containing child pornography, including the lewd and lascivious posing, sexual penetration, and bondage of minor girls, as well as a substantial collection of child erotica. During exchanges with at least 53 email accounts, Manganelli and others discussed their mutual sexual interest in children. In other email exchanges, Manganelli claimed that he sexually molested a prepubescent girl and also asked others how to groom a child to engage in sexual activity with him.
On March 25, 2013, FBI agents interviewed Manganelli when he admitted that he possessed, received and distributed child pornography. He falsely claimed that during the two to three years he collected and shared child pornography, he was doing research in an attempt to identify sexual predators online. Manganelli was never assigned or authorized by the Waltham Police Department to conduct an online investigation, nor did he ever report any criminal conduct he observed.
United States Attorney Carmen M. Ortiz and Vincent B. Lisi, Special Agent in
Charge of the Federal Bureau of Investigation, Boston Field Division, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Stacy Dawson Belf of Ortiz’s Major Crimes Unit.The case is brought as part of Project Safe Childhood. In 2006, the Department of Justice created Project Safe Childhood, a nationwide initiative designed to protect children from exploitation and abuse. Led by the U.S. Attorneys= Offices and the Criminal Division=s CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend, and prosecute individuals who exploit children, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov/
Former St. Clair County Sheriff Indicted for Stealing Recovered PropertyRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that the former sheriff of St. Clair County, Mo., was indicted by a federal grand jury today for stealing property recovered in criminal cases and for selling a stolen firearm.
“Today’s indictment alleges that the former sheriff treated the county’s evidence room like his personal tool shed, cheating the taxpayers and citizens of St. Clair County,” Dickinson said. “No one is above the law. When the county’s chief law enforcement officer violates the very law he took an oath to uphold, he will be held accountable.”
Ronald E. Snodgrass, 46, of El Dorado, Mo., was charged in a three-count indictment returned by a federal grand jury in Springfield, Mo. Snodgrass served three terms as the elected sheriff in St. Clair County, from Jan. 1, 2001, through Dec. 31, 2012. He lost his bid for reelection in 2012.
Under state law, any property seized by the sheriff’s department must be disposed of by a court order that authorizes the return of the property to a claimant. If property is unclaimed, it must be disposed of through a public sale (with the proceeds deposited in the county treasury), destroyed, or forfeited to the state. State law did not authorize Snodgrass to convert unclaimed property seized in criminal cases to his own personal use.
Today’s indictment charges Snodgrass with two counts of theft concerning programs that receive federal funds. (During Snodgrass’s tenure as sheriff, the U.S. Marshals Service contracted with St. Clair County to house federal inmates at the St. Clair County Jail.) Snodgrass allegedly stole a John Deere zero turn mower on Sept. 8, 2009. Snodgrass allegedly stole a 2009 Polaris Ranger UTV on Sept. 29, 2012.
The federal indictment also charges Snodgrass with selling a stolen firearm. Between Aug. 7, 2012, and Dec. 31, 2012, Snodgrass allegedly sold a Remington .22-caliber rifle that he knew had been stolen.
The indictment also contains a forfeiture allegation, which would require Snodgrass to forfeit to the government any property derived from the proceeds of the alleged offenses, including a money judgment of $16,000.
Dickinson cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges 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 Abram McGull, II. It was investigated by the FBI, the Missouri State Highway Patrol and the St. Clair, Mo., Sheriff’s Department.
Former Police Officer from Oklahoma Sentenced to Federal Prison for Child Pornography ConvictionRead the Press Release
ALBUQUERQUE – Robert Mullen, 61, a former officer with the Lawton, Okla., Police Department who relocated to Albuquerque, N.M. was sentenced to 65 months in federal prison for his conviction for distribution and possession of visual depictions of minors engaged in sexually explicit conduct. Mullen will be on supervised release for 15 years after completing his prison sentence and will be required to register as a sex offender.
Mullen was arrested on Dec. 17, 2013, by Special Agents of Homeland Security Investigations (HSI) on a criminal complaint charging him with receiving and possessing visual depictions of minors engaged in sexually explicit conduct. On Jan. 15, 2014, Mullen was indicted and charged with distribution of child pornography and possession of child pornography. The indictment alleged that Mullen committed these two offenses between Aug. 2013 and Dec. 2013, in Bernalillo County, N.M. On March 26, 2014, Mullen entered a guilty plea to both counts of the indictment without the benefit of a plea agreement.
According to court filings, in Aug. 2013, a special agent with the New Mexico Attorney General’s Office (NMAGO) identified an IP address that was being used to share files containing child pornography while conducting an investigation targeting those who share child pornography on peer-to-peer file sharing networks. Subsequent investigation revealed that the IP address was subscribed to Mullen at a residential address in the west side of Albuquerque.On Dec. 11, 2013, HSI, the Albuquerque Police Department (APD) and other agencies participating in the New Mexico Internet Crimes Against Children (ICAC) Task Force executed a state search warrant at the residence and seized a computer and computer-related media. A preliminary forensic examination of a computer taken from a bedroom used by Mullen recovered images and videos consistent with child pornography.
This case was investigated by the Albuquerque office of HSI, the NMAGO, APD and other agencies affiliated with the New Mexico ICAC Task Force. The case was prosecuted by Assistant U.S. Attorneys Marisa A. Lizarraga and Jacob A. Wishard as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice (DOJ) to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and DOJ’s Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
The case also was brought as a part of the New Mexico ICAC Task Force’s mission, which is to locate, track, and capture Internet child sexual predators and Internet child pornographers in New Mexico. There are 74 federal, state and local law enforcement agencies associated with the ICAC Task Force, which is funded by a grant administered by the NMAGO. Anyone with information relating to suspected child predators and suspected child abuse is encouraged to contact federal or local law enforcement.
Former Merrimack College Director of Financial Aid Charged with FraudRead the Press Release
BOSTON - The former Director of Financial Aid for Merrimack College was charged yesterday with fraudulently obtaining funding for the North Andover school’s students.
Christine Mordach, 62, of Methuen, was charged with two counts of mail fraud and two counts of wire fraud.
As the Director of Financial Aid for Merrimack College, Mordach was responsible for administering the Perkins Loan program. The Federal Perkins Loan Program provides low-interest loans to help needy students finance the costs of post-secondary education. The United States Department of Education provides Perkins Loan funding to each participating school, and the school determines which students have the greatest need and disburses the funds accordingly. Each school’s revolving Perkins Loan fund is replenished by ongoing activities, such as collections by the school on outstanding Perkins Loans the school amkes. If awarded a Perkins Loan, a student must complete and sign a Perkins Loan promissory note in order to receive the loan funds.
It is alleged that from 1998 to 2007, Mordach had Perkins Loan funds fraudulently disbursed to Merrimack College students. In some instances, Mordach asked students, to whom Merrimack College had offered grants, to take out Perkins Loans instead, falsely telling the students that Merrimack College was in danger of losing its unused Perkins Loan funds. Mordach falsely promised that the students would receive grants for the next academic year in the amount borrowed from the Perkins Loan program which enabled them to pay off their Perkins Loans.
In other instances, Mordach allegedly disbursed Perkins Loan funds to Merrimack College students without a signed promissory note and without the students’ knowledge or approval. Through at least September 2011, Mordach took actions to conceal the fraudulent Perkins Loans from the students and their parents, and from Merrimack College.
The charging statute provides a sentence of no greater than 20 years in prison, three years of supervised release, and a fine of $250,000. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz; Brian Hickey, Special Agent in Charge, Department of Education, Office of Inspector General in Boston; and Scott Antolik, Special Agent in Charge of the Office of Inspector General, Social Security Administration, Office of Investigations – Boston Field Division, made the announcement today. The case is being prosecuted by Kristina E. Barclay of Ortiz’s Public Corruption Unit.
Those who believe that they are a victim of the crimes alleged against Christine Mordach should contact the U.S. Attorney’s Office for the District of Massachusetts at [email protected].
Identified victims will receive notification through an automated victim notification system. Those who have not received notification and believe they should be included as a victim, should contact the U.S. Attorney’s Office at [email protected].
The details contained in the Information are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.Former Maryland Correctional Officer Sentenced in Connection with Series of Assaults on InmateRead the Press Release
James Kalbflesh, a former correctional officer at the Roxbury Correctional Institution (RCI) in Hagerstown, Maryland, was sentenced today in connection with the March 9, 2008, assault of Kenneth Davis, an inmate. U.S. District Judge James K. Bredar sentenced Kalbflesh to serve 60 months in prison.
Kalbflesh was found guilty by a federal jury of conspiracy against rights, deprivation of rights under color of law and conspiracy to obstruct justice. Evidence at trial and in court documents filed in connection with his convictions established that Kalbflesh and other officers at RCI met during the midnight shift and agreed to assault Davis in retaliation for a prior incident involving Davis and another officer. Kalbflesh and other officers then entered Davis’ cell and assaulted him.
Davis was also subjected to retaliatory assaults by officers from the preceding and following shifts. Davis suffered facial fractures, a broken rib and fractured vertebrae, among other injuries, as a result of the series of assaults. The assaults by Kalbflesh and other RCI officers resulted in serious injuries that left Davis unrecognizable. Kalbflesh is the last remaining officer to be sentenced in the related RCI cases.
“Sixteen former correctional officers from RCI have been convicted and sentenced for their involvement in the series of beatings of an inmate, and in the coordinated cover-ups that followed each assault,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “These officers betrayed the public trust by using their official positions to commit violent civil rights abuses and then tried to cover up their crimes. The Department of Justice will continue to prosecute vigorously correctional officers who use their power to violate federal law.”
The case was investigated by the Frederick Resident Agency of the FBI, and prosecuted by Special Litigation Counsel Forrest Christian and Trial Attorney Sanjay Patel of the Civil Rights Division.
Former IRS Employee Arrested Today for ID Theft Conspiracy: $1.2 Million Attempted Fraud, 160 VictimsRead the Press Release
FRESNO, Calif. — Former IRS employee Viririana Hernandez, 30, was arrested this morning at her mother’s home in Parlier, charged with an identity theft conspiracy that used information stolen from the files of other IRS employees, United States Attorney Benjamin B. Wagner announced.
Co-defendants Roberto Martinez, 33, and Lilliana Gonzalez, 32, both of Fresno, were also arrested at their residence this morning. All three defendants were arraigned today and entered pleas of not guilty. Martinez was released from custody with electronic monitoring. Hernandez and Gonzalez remain in custody and have a detention hearing on Thursday, July 24, 2014. Arraignment for a fourth defendant, Daniel Miranda, 25, has not yet been scheduled.
On July 18, 2014, a federal grand jury in Fresno returned a 23-count indictment, charging the defendants with conspiracy, bank and wire fraud, and aggravated identity theft. Miranda was also charged with mail fraud.
According to the indictment, from June 2012 to January 2014, the four conspirators obtained personal information from victims through various methods. Hernandez worked for the IRS since 2006 and had access to the personal information of IRS workers. Several of the victims are current or former IRS workers. Without the victims’ permission, they opened credit card accounts in the victims’ names or added themselves as “authorized users” of the victims’ existing accounts. The conspirators then used the accounts to buy goods and services at locations throughout the Fresno area, as well as in Modesto and Riverside County. In total, it is alleged that the four conspirators misused the personal information of approximately 160 victims and attempted fraudulent credit card charges of more than $1.2 million.
San Francisco Division Inspector in Charge Rafael Nunez of the U.S. Postal Inspection Service stated: “We are working closely with the U.S. Attorney’s Office and our partners in law enforcement to arrest and prosecute those responsible for using mail delivery for a fraud scheme.”
Treasury Inspector General for Tax Administration San Francisco Field Division Special Agent-in-Charge Rod Ammari stated: “Identity theft is a nationwide crisis that places a heavy burden on the victim and creates chaos in the victims’ lives. When an IRS employee is involved in stealing information through their employment at the IRS and facilitating identity theft rings, it will not be tolerated and the Treasury Inspector General for Tax Administration will use all its power and resources to ensure these criminals are brought to justice.”
This case is the product of an investigation by the United States Postal Inspection Service, the Treasury Inspector General for Tax Administration, and the Fresno Police Department. Assistant United States Attorney Michael G. Tierney is prosecuting the case.
If the defendants are convicted, they each face a maximum statutory penalty of 30 years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory sentencing factors and the Federal Sentencing Guidelines, which take into account a number of variables.
The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
Former Airport Baggage Handler Sentenced to 11 Years for Participating in Drug ConspiracyRead the Press Release
PHILADELPHIA – James Mickens, 30, of Philadelphia was sentenced today to 11 years in prison for his participation in a large scale drug organization. Between February 2010 and July 2011, Mickens, a former US Airways baggage claim handler at the Philadelphia International Airport, used his Airport secured access card to smuggle hundreds of thousands of dollars in drug proceeds through the Airport, in order to avoid detection by law enforcement. Further, Mickens made multiple trips to Los Angeles, California for the drug organization, where multiple kilograms of cocaine and hundreds of pounds of marijuana were purchased and transported back to Philadelphia as checked luggage.
In addition to the prison term, U.S. District Court Judge Gene E. K. Pratter ordered five years of supervised release and a $200 special assessment.
The case was investigated by the Federal Bureau of Investigation, U.S. Immigration and Customs Enforcement Homeland Security Investigations, and the Philadelphia Police Department. It was prosecuted by Assistant U.S. Attorney Karen Marston.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Forex Trader Sentenced for Defrauding Investors of over $400,000Read the Press Release
The U.S. Attorney's Office for the Middle District of Pennsylvania announced today that Christopher A. Engel, 34, formerly of Glen Rock, Pennsylvania, and currently residing in Washington, Utah, was sentenced in connection with his operation of Pinnacle Forex Group ("PFG"), LLC, a currency trading firm that he operated from his home in Glen Rock.
United States District Court Judge Yvette Kane sentenced Engel to 38 months’ imprisonment, $405,500 in restitution and two years’ supervised release. Engel was ordered to surrender to the Bureau of Prisons on August 18, 2014.
According to U.S. Attorney Peter Smith, Engel created PFG in 2010 and advertised it on the internet as "a full scale currency investment firm" that was "in the top 1% of currency traders." Between June 2011 and October 2012, Engel allegedly received $411,500 from 21 investors throughout the United States that was supposed to be invested in the Foreign Exchange Market ("Forex"). Engel admitted he only invested $137,000 of the money into the Forex market and later withdrew those funds for personal expenses. The remaining funds were never invested and also used by Engel for personal expenses.
The case was investigated by the FBI and was prosecuted by Senior Litigation Counsel Bruce Brandler.
Felon and Illegal Alien Sentenced for Possessing A FirearmRead the Press Release
BOISE – Raul Valencia-Hernandez, 51, of Palmdale, California, was sentenced today to 20 months in prison for being a prohibited person in possession of a firearm. Chief U.S. District Judge B. Lynn Winmill also ordered Valencia-Hernandez to forfeit the firearm involved in the offense. Valencia-Hernandez pleaded guilty to the charge on May 12, 2014.
According to information presented at his sentencing hearing, on October 15, 2013, officers with the Twin Falls Police Department responded to a call of suspicious drug activity at the Motel 6 in Twin Falls. Valencia-Hernandez was found to be in possession of a loaded Ruger 9mm pistol, a digital scale, methamphetamine pipes, plastic baggies with methamphetamine residue and a drug ledger. Valencia-Hernandez is prohibited from possessing any firearm because he is an alien illegally in the United States, and because he had previously been convicted of the felony offense of sale or transport of a controlled substance in California. Valencia-Hernandez, who has illegally resided in the United States for the past 34 years, will be deported to Mexico after serving his prison sentence.
This case was investigated by the Twin Falls Police Department and the Bureau of Alcohol, Tobacco, Firearms, and Explosives.
Federal Indictment Charges Three Individuals with Drug Crimes Related to Distribution of MethamphetaminesRead the Press Release
EUGENE, Ore. - Three defendants were charged in two separate indictments based on their drug activity in Lincoln County.
Christobal Portillo, 37, and Salina Perez, 35, both of Oregon, were charged with conspiracy to distribute methamphetamine. Both made their initial appearances on July 18, 2014 and entered pleas of not guilty. Trial is set for September 23, 2014 before Chief U. S. District Judge Ann Aiken.
Separately, Patrick Ball, 37, of Toledo, Oregon, was charged with possession with intent to distribute methamphetamine. He also made his initial appearance on July 18, 2014 and pleaded not guilty. Bell is also scheduled for trial on September 23, 2014 before Chief U. S. District Judge Ann Aiken.
Both conspiracy to distribute methamphetamine and possession with intent to distribute carry maximum sentences of twenty years in prison and a one million dollar fine.
A criminal indictment is only an allegation and not evidence of guilt. The defendants are presumed innocent unless and until proven guilty. These cases were investigated by the Lincoln Interagency Narcotics Team, the Polk County Interagency Narcotics Team and the Drug Enforcement Administration. This case is being prosecuted by Assistant U.S. Attorney Amy Potter.
Federal Criminal Charges Filed against Eight People Involved in Hash Oil ExplosionsRead the Press Release
Federal prosecutors today charged eight people in connection with explosions tied to the illegal and dangerous practice of extracting hash oil from marijuana, announced U.S. Attorney Jenny A. Durkan. The explosions in Bellevue, Kirkland, Seattle and Puyallup resulted in multiple injuries to innocent bystanders, some of whom were unaware of the illegal activity nearby. One of those injured died due to complications after hospitalization. The defendants will appear in U.S. District Court in Seattle and Tacoma later today.
“Manufacturing hash oil is illegal and poses a significant risk to families, neighbors and the general public,” said U.S. Attorney Durkan. “An explosion and fire caused by hash oil production at a Bellevue apartment complex caused significant injuries to people trying to escape the flames. We will not stand by and allow this dangerous conduct to endanger the public.”
“Home-based manufacturing of THC remains illegal under state law, even with the passage of Initiative 502,” said Pierce County Prosecutor Mark Lindquist. “The explosion in Puyallup demonstrates how dangerous oil extraction can be. Our office is committed to working with our federal counterparts to ensure Washington’s recreational marijuana system is properly regulated for the safety of our community.”
Three people were charged today in connection with the Bellevue explosion and fire on November 5, 2013. Former Bellevue Mayor Nan Campbell was hospitalized for a broken pelvis she suffered trying to escape the flames. She later died following complications after her hospitalization. Two other apartment residents suffered shattered bones as they had to jump from their upper level apartments. DAVID RICHARD SCHULTZ, II, 32, DANIEL JAMES STRYCHARSKE, 28, and JESSE D. KAPLAN, 31, are charged with Endangering Human Life While Manufacturing Controlled Substances, Maintaining a Drug Involved Premises and Manufacturing Hash Oil and Marijuana.
Two people are charged in connection with an explosion and fire in Puyallup May 20, 2014. SETH M. CLEEK, 31, was allegedly producing hash oil for KEVIN WEEKS, JR., 24, and his company “Cap’n Cosmics,” that makes and sells marijuana edible products. The explosion at the home endangered multiple residents including a 14-month old child. Both men are charged with Endangering Human Life While Manufacturing Controlled Substances, Maintaining a Drug Involved Premises and Manufacturing Hash Oil and Marijuana. Photos from the scene show burned siding, a butane can driven through a plastic pot by the force of the explosion and children’s toys melted by the heat of the fire.
Three additional defendants are charged in connection with explosions in Kirkland and the Mount Baker neighborhood in Seattle. ROBBY WAYNE MEISER, 46, and BRUCE W. MARK, 62, is charged with the January 1, 2014 explosion and fire at the Inglenook Apartments in Kirkland. HUGH RODNEY HARRIS, 65, is charged with the January 7, 2014 explosion at 2802 S. McClellan Street, in Seattle.
“These deadly explosions are reckless and preventable acts,” said DEA Special Agent in Charge Matthew G. Barnes. “As marijuana cultivation activities increase, explosions will continue. DEA will stand by our law enforcement partners in stemming this dangerous threat.”
“We are committed in the support of our federal, state and local partners in their ongoing efforts to ensure citizens in our community are safe from illegal acts resulting in violence,” said Douglas R. Dawson, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms & Explosives, Seattle.
Endangering Human Life While Manufacturing Controlled Substances is punishable by up to ten years in prison and three years of supervised release; Maintaining a Drug Involved Premises is punishable by up to 20 years in prison and three years of supervised release and Manufacturing Hash Oil and Marijuana is punishable by up to five years in prison and three years of supervised release.
The charges contained in the complaints are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
The cases were investigated by multiple local and federal agencies including: the Drug Enforcement Administration (DEA), Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF), the U.S. Marshals Service, the Bellevue Police Department, the Seattle Police Department, the Kirkland Police Department, the Puyallup Police Department and the Pierce County Sheriff’s Office. Significant assistance was provided by the Pierce County Prosecutor’s Office.
El Dorado Man Sentenced to 17 Years in Prison for Sexual Exploitation of a MinorRead the Press Release
Project Safe Childhood
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that an El Dorado Springs, Mo., man was sentenced in federal court today for sexually exploiting a minor.
Bryan Lee Courtney, 24, of El Dorado Springs, was sentenced by U.S. District Judge Beth Phillips to 17 years in federal prison without parole. The court also ordered Courtney to pay $1,494 in restitution to the victim for counseling.
On Feb. 7, 2014, Courtney pleaded guilty to using a minor to produce child pornography. Courtney admitted that he used his cell phone to make a video recording of himself having sex with a 15-year-old minor.
Police officers executed a search warrant at Courtney’s residence on Jan. 8, 2013. Officers seized several cell phones, iPods and other digital media. Investigators found two videos on one of the cell phones of Courtney and the minor victim having sex. Investigators also found several nude or partially nude photographs of the minor victim.
According to court documents, Courtney actively tried to isolate the victim from both her family and friends through physical and psychological intimidation. He took pictures and video of his sexual exploitation to both brag about his sexual conquest and to isolate the victim from her friends and family. Courtney displayed these videos and pictures to his friends and co-workers and to the victim’s friends. Courtney sent an image of the naked child to her father after he had been charged in state court with statutory rape.
This case was prosecuted by Assistant U.S. Attorney Patrick Carney. It was investigated by the Southwest Missouri Cyber Crime Task Force and the FBI.Dorchester Woman Pleads Guilty to Theft of Government BenefitsRead the Press Release
BOSTON - A Dorchester woman pleaded guilty today to stealing almost $350,000 in government benefits to which she was not entitled.
Mary Murphy, 62, pleaded guilty to theft of public money. In April 2014, Murphy was charged in a felony information. Sentencing is scheduled for Oct. 22, 2014.
Murphy’s mother died in 1977, but her monthly Social Security payments and Civil Service Retirement System annuity payments continued to be directly deposited into a joint bank account in her name and Murphy’s name. From 1977 to 2013, Murphy continued to receive her deceased mother’s benefits, including $206,679 in Social Security benefits and $143,098 in Civil Service Retirement System annuity payments.
United States Attorney Carmen M. Ortiz; Scott Antolik, Special Agent in Charge of the Office of Inspector General, Social Security Administration, Office of Investigations – Boston Field Division; and Scott Rezendes, Special Agent in Charge of the Office of Inspector General, Office of Personnel Management, Field Operations made the announcement today. The case is being prosecuted by Special Assistant U.S. Attorney Timothy Landry of Ortiz’s Major Crimes Unit.Convenience Store Operator Pleads Guilty to Food Stamp Fraud on the First Day of TrialRead the Press Release
Baltimore, Maryland – Abdo Mohamed Nagi, age 54, a citizen of Yemen residing in Baltimore, pleaded guilty on July 21, 2014, to two counts of food stamp fraud and six counts of wire fraud in connection with a scheme to illegally redeem food stamp benefits in exchange for cash. Nagi admitted that he obtained more than $1.2 million from the food stamp program, to which he was not entitled. Nagi entered his guilty plea on the first day of his trial.The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge William G. Squires, Jr. of the U.S. Department of Agriculture’s Office of Inspector General, Northeast Region; and Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation.
According to the indictment to which he pleaded guilty, Nagi owned and operated New York Deli and Grocery, located at 1207 West Baltimore Street, in Baltimore. Through the store, Nagi participated in the Supplemental Nutrition Assistance Program (SNAP), previously known as the Food Stamp Program. In Maryland, the program provides eligible individuals with an electronic benefit transfer (EBT) card called the Independence Card, which operates like a debit card. Recipients obtain EBT cards through the state Department of Human Resources, then use the EBT card to purchase approved food items from participating retailers.
Nagi knew that it was a violation of SNAP regulations to trade cash for SNAP benefits. Nevertheless, from February 2011 through May 2013, Nagi exchanged SNAP benefits for cash at less than face value of the EBT benefits, in violation of the food stamp program rules. Typically, Nagi and kept up to 50 percent of the benefits for himself. To avoid detection, Nagi often debited funds in multiple transactions within minutes of each other. As a result of these illegal cash transactions, Nagi admitted that he obtained more than $1.2 million for food sales that never occurred.
Nagi faces a maximum sentence of 20 years in prison for each of the six counts of wire fraud and five years in prison for each of the two counts of food stamp fraud. U.S. District Judge J. Frederick Motz has scheduled sentencing for October 10, 2014 at 10:00 a.m.
Eight of the 10 convenience store owners or operators who were indicted in September 2013 in connection with schemes to illegally redeem food stamp benefits in exchange for cash have pleaded guilty to food stamp fraud and/or wire fraud. Abdullah Aljaradi, age 52, and Ahmed Ayedh Al-Jabrati, age 56, both citizens of Yemen residing in Baltimore, were each sentenced to two years in prison, and ordered to pay restitution of $1.2 million. Jung Kim, age 52, of Ellicott City, Maryland, was sentenced to 20 months in prison, and ordered to forfeit $95,453.50 and pay restitution of $205,000. Amara Cisse, age 51, of Windsor Mill, Maryland, was sentenced to 27 months in prison and ordered to pay restitution of $654,349.24, and his wife, Fanta Keita was sentenced to two months in prison. John Cunningham, age 55, of Baltimore, was sentenced to two years in prison. Retailer Hyung Cho, age 40, was sentenced to 38 months in prison, and his mother Dae Cho, age 67, was sentenced to 18 months in prison. The Chos were also ordered to forfeit $371,439.21 and pay restitution of $1.4 million. Two more retailers were indicted in January 2014.
United States Attorney Rod J. Rosenstein praised USDA’s Office of Inspector General and FBI for their work in the investigation. U.S. Attorney Rosenstein expressed appreciation to Secretary Ted Dallas and the Maryland Department of Human Resources, as well as U.S. Citizenship and Immigration Services - Office of Fraud Detection and National Security for their assistance in the investigation. Mr. Rosenstein thanked Assistant United States Attorney Leo J. Wise, who is prosecuting this case.
Columbus Man Charged with Tax ViolationRead the Press Release
Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, today announced that a federal information has been filed charging David S. Owens aka D. Scott Owens, age 62, of Columbus, Ohio, with one count of failure to account for an pay over employment tax.
Between 2008 and 2009, Owens, through his Canfield, Ohio-based company, Advetech, Inc., made payroll tax withholdings from his employees’ paychecks, but failed to pay over those withholdings to the IRS in the approximate amount of $570,000, according to the information.
Rather, during this period, Owens transferred hundreds of thousands of Advetech, Inc. dollars to at least two other Canfield companies owned and operated by Owens, including Brixton Development Corporation and Preferred Communities, Inc., from where he took hundreds of thousands of dollars in income for himself, according to the information.
The information was filed by Assistant U.S. Attorney Christos N. Georgalis after an investigation by agents of the the Internal Revenue Service and the U.S. Department of Labor, Employee Benefits Security Administration.
If convicted, the defendant’s sentence will be determined by the court after a review of factors unique to the case, including defendant’s prior criminal record, if any, 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.
An information 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.
Coeur D´Alene Man Sentenced for Possessing Child PornographyRead the Press Release
COEUR D´ALENE – Wade Thomas Weingart, 39, of Coeur d´Alene, Idaho, was sentenced yesterday in United States District Court to 60 months in prison, followed by 5 years of supervised release for possession of sexually explicit images of minors, U.S. Attorney Wendy J. Olson announced. United States District Judge Edward J. Lodge also ordered Weingart to pay $3,000 in restitution to an identified child found within his child pornography collection. Weingart pleaded guilty to the charge on January 30, 2014.
According to statements made in court, in July 2012, a police officer working with the Idaho Internet Crimes Against Children Task Force (ICAC) discovered that a computer in Coeur d´Alene was making child pornography available on the Internet. The officer was able to view several of the files that this computer made available and determined that they were images of minors being sexually abused by adults. Using information obtained from the Internet and an Internet Service Provider, the officer determined that the images were being made available from Weingart’s Coeur d’Alene residence.
In January 2013, a federal search warrant was served on Weingart’s residence. Weingart admitted to possessing the child pornography. A United States Secret Service Forensic Examiner reviewed Weingart’s computer and found over 60 videos of minors being sexually abused. Some of these children were identified and found to be from Washington, Georgia, Utah, Canada and Germany.
The case was investigated through the collaborative effort of the Federal Bureau of Investigation, Boise Police Department, Idaho Attorney General’s Office, Coeur d’Alene Police Department, and United States Secret Service. These agencies are members of the Idaho Internet Crimes Against Children (ICAC) Task Force, a statewide coalition of local, state and federal law enforcement and prosecution agencies, focused on apprehending and prosecuting individuals who use the Internet to criminally exploit children. For more information about the Idaho ICAC Task Force and a list of all the participating agencies, visit www.icacidaho.org.
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.”
Co-Owner of St. Jude's Pharmacy in Cape Coral Sentenced to 3 Years for Structuring Bank DepositsRead the Press Release
Fort Myers, Florida - U.S. District Judge Sheri Polster Chappell yesterday sentenced Martha Otano (43, Cape Coral) to 3 years and 1 month in prison and $7,500 in fines for making structured cash deposits of proceeds of illegal activity in order to evade bank currency transaction reporting requirements. As part of her sentence, the court also entered a money judgment in the amount of $1,307,000, the amount of drug proceeds structured into various banks. Otano was also ordered to forfeit her interest in a 2013 Mercedes Benz, a 2012 Chevrolet truck, and approximately $860,376.79 in seized funds, in partial satisfaction of the money judgment. Law enforcement seized these assets and executed search warrants at St. Jude’s Pharmacy and at Otano’s home in Cape Coral, on November 15, 2012. Martha Otano was a registered pharmacy technician and co-owner of St. Jude’s Pharmacy in Cape Coral. She was indicted on June 26, 2013.
According to court documents, from at least April 2011 to at least November 15, 2012, in Lee County, Martha Otano and her husband (Jorge Otano) participated in a conspiracy involving repeated structured cash deposits into bank accounts for the purpose of evading bank transaction reporting requirements. Martha Otano admitted to conspiring to structure approximately $1,307,000.00 in cash deposits into three bank accounts that she controlled with her husband. Martha Otano also admitted that she and her husband made structured deposits from the proceeds of the distribution of Oxycodone outside the usual course of professional practice at St. Jude’s Pharmacy, which they owned and operated. Martha Otano and her husband did not deposit all of the cash that they had at the time of receipt. Rather, they acquired one sum of cash at one time, and divided it into amounts less than $10,000.00 so that it would not trigger the filing of a Currency Transaction Report (CTR). St. Jude’s Pharmacy made a significant profit through the illegal distribution and sale of Oxycodone as fraudulent prescriptions for Oxycodone were routinely filled at St. Jude's Pharmacy in exchange for cash. Martha Otano and her husband used the proceeds from the pharmacy to purchase two homes in Cape Coral and the two seized vehicles.
Jorge Otano has pleaded not guilty to the charges filed against him in this case. He is scheduled for trial during the November 2014 trial term.
An indictment is merely a formal charged that a defendant has committed a violation of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the United States Secret Service and the Drug Enforcement Administration. It is being prosecuted by Assistant United States Attorneys David G. Lazarus and Yolande G. Viacava.
Chicago Resident Charged with Interstate Travel to Facilitate Drug TraffickingRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a criminal Information was filed today charging a Chicago resident with traveling in interstate commerce to promote and facilitate drug trafficking.
According to United States Attorney Peter Smith, the Information alleges that Maria Pina, age 44, a Mexican national who resided in Chicago, Illinois, at the time of her arrest, traveled from Illinois to Pennsylvania on February 11 and 12 of this year to further the efforts of a drug trafficking conspiracy operating in the Middle District of Pennsylvania and elsewhere.
The charge stems from an investigation by special agents of the Drug Enforcement Administration, U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), the Pennsylvania State Police, and Berks County Detectives.
Pina faces a potential maximum sentence of five years in prison and a $250,000 fine if she is convicted of the charge.
The case is being prosecuted by Assistant U.S. Attorney Francis P. Sempa.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
California Man Convicted in Federal Drug Trafficking ConspiracyRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that a California man was convicted yesterday in a case involving the trafficking of methamphetamine in Anchorage. A federal trial jury found David Alan Gonzales guilty of drug trafficking conspiracy and possession of methamphetamine with intent to distribute.
Gonzales, 55, was tried before United States District Court Judge Sharon L. Gleason in Anchorage.
According to Special Assistant U.S. Attorney Erin Bradley and law student intern Lyubov Bartnitskaia, who prosecuted the case, the evidence presented at trial established that Gonzales conspired to possess with intent to distribute and to distribute 52 grams of actual methamphetamine. This case came to light when the U.S. Postal Inspection Service identified a suspicious package at their processing center on March 26, 2013. The package had been sent to Anchorage from Anaheim, California. Gonzales and his co-defendant, Albert Diaz Gumataotao, accepted delivery of the package on March 28, 2013. Investigation revealed that the package contained 52 grams of methamphetamine. A forensic chemist from the U.S. Postal Service Forensic Laboratory testified that the purity of the methamphetamine was 100%. Though Gonzales was residing in Anchorage at the time of this offense, he has significant ties to the State of California, where he has lived most of his life.
Gonzales remains in custody pending sentencing. His co-defendant, Albert Diaz Gumataotao, pled guilty on November 6, 2013, to one count of drug trafficking conspiracy. On February 12, 2014, Judge Gleason sentenced Gumataotao to imprisonment for 120 months.
Judge Gleason scheduled sentencing for Gonzales on October 9, 2014, at 1:30 p.m. Based on the charges of conviction, as well as Gonzales’ prior California convictions for possession of methamphetamine and possession of methamphetamine for sale, Gonzales faces a sentence of up to life in prison, a fine of Twenty Million Dollars, or both.
Ms. Loeffler commends the U.S. Postal Inspection Service and the Anchorage Police Department for the investigation leading to the successful prosecution of Gonzales and Gumataotao. SAUSA Bradley is a prosecutor in the U.S. Attorney’s Office who is funded by the Municipality of Anchorage for the purpose of prosecuting gang-related and violent crime cases.
Business Manager Sentenced to Prison for FraudRead the Press Release
United States Attorney Walt Green announced today the sentencing of RENEE ELISE BEARD, 50, of Addis, Louisiana. BEARD previously pled guilty on December 2, 2013 to wire fraud in violation of Title 18, United States Code, Section 1343.
BEARD was sentenced today by United States District Judge James J. Brady to 27 months imprisonment and a term of 2 years on supervised release following imprisonment. BEARD was also sentenced to pay restitution in the amount of $295,587 to the victim of her fraud. Additionally, BEARD was ordered to forfeit $251,596 to the United States, said funds being the property which was derived from her scheme to defraud.
BEARD was the manager of business operations for Campbell Companies, a local business engaged in the development and management of commercial real estate and multi-family residential properties. BEARD was responsible for bookkeeping, management of financial operations, and administration of the company's payroll. BEARD enjoyed unlimited access to Campbell’s accounting and payroll systems, bank accounts, and computer systems. During the years 2008 through 2012, BEARD was authorized to initiate and execute online banking transactions for the purpose of disbursing payroll to Campbell’s employees, including payments to herself. BEARD used her position as Campbell’s business manager to make numerous transfers from a Campbell Companies’ business bank account to her personal bank accounts which exceeded the salary to which she was entitled. As a result of making unauthorized transfers of funds from the bank account of Campbell to her personal bank accounts, BEARD fraudulently obtained approximately $251,596 to which she was not entitled. BEARD used wire communications in order to execute her scheme.
United States Attorney Green stated: “Corporate fraud is inexcusable and is too often perpetrated by insiders who abuse the trust afforded to them. It is often the honest employees who are left to feel the greatest financial brunt of such wrongdoing. Our office will continue to aggressively pursue such matters.”
This case was investigated by the Federal Bureau of Investigation and was prosecuted by Assistant United States Attorney Rene I. Salomon.
Bucksport Woman Sentenced to More Than 8 Years for Bank Embezzlement and Tax FraudRead the Press Release
Contact: F. Todd Lowell
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Lynn
M. Bowden, 63, of Bucksport, Maine, was sentenced today in U.S. District Court in Bangor to
97 months in prison and five years of supervised release for embezzlement by a bank employee
and tax fraud. She was also ordered to pay $3,822,166.27 in restitution. The defendant pleaded
guilty to the charges on February 19, 2014.According to court documents, Bowden was employed by Merrill Merchants Bank
(“Merrill”) in May 2004. Chittenden Corporation acquired Merrill in 2007. People’s United
Bank acquired Chittenden Corporation in 2008. Bowden maintained her employment through
these acquisitions. In October 2012, she was working as a wealth management officer managing
over 200 trust and investment management accounts when her embezzlement was discovered.
The investigation revealed that from April 4, 2005 to September 26, 2012, Bowden
embezzled $2,990,429.65 from client accounts that she managed by transferring the funds into
her personal accounts. She used all of the money for herself and family members. Bowden
failed to report this income to the Internal Revenue Service on her tax returns causing a tax loss
of more than $750,000 for the period from 2007 to 2011. On October 26, 2012, the bank
terminated her employment, and ultimately reimbursed customers for their losses.
The case was investigated by the Federal Bureau of Investigation and the Internal
Revenue Service-Criminal Investigations.Brazoria County Drug Lord Sentenced to 22 Plus Years in Federal PrisonRead the Press Release
Department of Justice
Office of Public AffairsBEAUMONT, Texas – The organizer and leader of a large scale drug trafficking ring responsible for moving multi-kilogram quantities of illegal drugs from Mexico to the United States has been sentenced to federal prison in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Alejandro “Alex” Gonzales, 36, of Alvin, Texas, pleaded guilty on Jan. 30, 2014 to conspiring to possess with the intent to distribute over 5 kilograms of cocaine, over 1,000 kilograms of marijuana, and over 500 grams of methamphetamine and was sentenced to 270 months in federal prison today by U.S. District Judge Thad Heartfield.
According to information presented in court, Gonzales began acquiring multi-kilogram quantities of cocaine, marijuana, and methamphetamine from drug cartel suppliers in Mexico sometime in the late 2000’s. Those narcotics were subsequently smuggled into the United States and transported to Alvin, Texas for distribution. Gonzales and other members of the drug ring coordinated the sale of those narcotics to customers located in Texas, Oklahoma, Louisiana, Alabama, Mississippi, Florida, North Carolina, New York, and New Jersey.
On Aug. 8, 2013, a federal grand jury returned a six-count second superseding indictment against Gonzales and 27 other codefendants, charging them with numerous federal drug trafficking conspiracy and firearm violations.
During the course of the investigation, state and federal agents successfully arrested 40 individuals and seized large quantities of cocaine, marijuana, methamphetamine, $766,577 in U.S. currency, 30 vehicles, a boat, three residences, and 25 firearms. This case was the result of an extensive two and a half year joint investigation by the Organized Crime Drug Enforcement Task Force (OCDETF). The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking, and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
This investigation was conducted by the U.S. Drug Enforcement Administration Galveston Resident Office, the Miami and Houston Division Offices, the McAllen District Office, and the Dickinson Police Department, with assistance from the Bureau of Alcohol, Tobacco, Firearms and Explosives, Federal Bureau of Investigation, Internal Revenue Service, U.S. Customs and Border Patrol, U.S. Immigration and Customs Enforcement/Homeland Security Investigations, U.S. Marshals Service, Marine Interdiction Agency, Texas Department of Public Safety, Brazoria, Galveston, Harris, and Jefferson County (Texas) Sheriff’s Offices, and the police departments of Alvin, Beaumont, Galveston, Houston, League City, Pasadena, and Pearland, Texas. This case is being prosecuted by Assistant U.S. Attorneys Baylor Wortham and Michelle Englade.
Bloomsburg Resident Charged with Bank LarcenyRead the Press Release
The United States Attorney for the Middle District of Pennsylvania announced that charges have been filed in U.S. District Court in Williamsport against Mary Ann Gillespie of Bloomsburg, Pennsylvania.
According to United States Attorney, Peter Smith, Gillespie, age 59, is charged in a one-count felony information with bank larceny during the period of November 2008 to September 2013. The offense is alleged to have occurred as a check kiting scheme carried out by the defendant involving accounts at the First Columbia Bank and Trust Company and Fulton National Bank in Bloomsburg.
The investigation was conducted by the Federal Bureau of Investigation, Williamsport Resident Agency. Assistant United States Attorney Wayne P. Samuelson is assigned to prosecute the case.
The government also filed a plea agreement in the case which is subject to the approval of the assigned judge.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statues and the Federal Sentencing Guidelines.
In this case, the maximum penalty under the federal statute is ten years imprisonment, and a fine of $250,000. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
Baton Rouge Tax Preparer Convicted for Her Role in Fraudulent Tax Return SchemeRead the Press Release
BATON ROUGE, LA – United States Attorney Walt Green announced Friday that MALETICA V. FERGUSON, age 37, of Geismar, Louisiana, pled guilty on Wednesday, July 16, 2014, before Chief U.S. District Judge Brian A. Jackson to a Bill of Information for aiding and assisting in the preparation of false tax returns. As a result of her conviction, FERGUSON faces a maximum term of imprisonment of three (3) years, a fine of up to $527,538, and the costs of prosecution.
This case was the result of an initiative by the United States Attorney’s Office, the Internal Revenue Service’s Criminal Investigations Division, and the United States Department of Justice’s Tax Division, to combat tax fraud schemes.
According to the factual basis presented in connection with her guilty plea, FERGUSON operated The Best Tax Service (BTS), an income tax preparation business in Baton Rouge, Louisiana. FERGUSON prepared and submitted twenty-six (26) false tax returns to the IRS for the 2010 and 2011 tax years. In the returns, by misrepresenting the taxpayers’ income and falsely claiming various credits and deductions, among other means, the defendant fraudulently claimed that the taxpayers were entitled to significant refunds from the IRS. As a result of her scheme, FERGUSON caused a loss $263,769 to the taxpayers of the United States.
U.S. Attorney Green stated: “Filing false tax returns is a serious crime that hurts innocent taxpayers. This office will continue to aggressively pursue criminals who intend to defraud the United States. The U.S. Attorney’s Office and the IRS are serious about investigating these crimes and prosecuting those who engage in this type of conduct.”
IRS Criminal Investigation Special Agent-in-Charge Gabriel Grchan stated: “Falsely claiming refundable tax credits that are established to help legitimate taxpayers is a crime and is punishable under the law. IRS Criminal Investigation will not stand by while individuals like FERGUSON use tax preparation businesses as a tool to defraud the government and victimize taxpayers.”
The case is being prosecuted by Assistant United States Attorney Cam T. Le.
Australian Man Pleads Guilty in Las Vegas to Biofuels Fraud SchemeRead the Press Release
Nathan Stoliar, 64, of Australia, pleaded guilty in federal court in Las Vegas today to five felonies for his role in multiple schemes, worth in excess of $41 million, to generate fraudulent biodiesel credits and to export biodiesel without providing biodiesel credits to the United States as required by law.
Stoliar and another defendant had been charged in January 2014 in a 57-count indictment alleging conspiracy, wire fraud, false statements under the Clean Air Act, obstruction of justice and conspiracy to engage in money laundering. Following his indictment, Stoliar’s arrest was sought by the United States. Located in Poland, Stoliar returned in early February to the United States to surrender for arrest. Stoliar pleaded guilty Tuesday to one count of conspiracy, one count of conspiracy to engage in money laundering, two counts of wire fraud and one count of making false statements under the Clean Air Act. Stoliar is required by the plea to forfeit $4 million and pay $1 million in restitution. He faces a maximum sentence of 20 years in prison and a $500,000 fine for each count of conspiracy to engage in money laundering and wire fraud, five years in prison and a $250,000 fine for conspiracy, and two years in prison and a $250,000 fine for making false statements under the Clean Air Act.
“Stoliar and his co-conspirator perpetrated a massive fraud against a renewable fuels program created to protect our nation’s energy security and independence,” said Sam Hirsch, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. “The Justice Department will continue to pursue fraudsters at home and abroad and protect the integrity of federal programs as it protects the environment.”
“By rooting out fraud, EPA is committed to achieving the environmental goals that Congress envisioned when it created the Renewable Fuel Standard,” said Cynthia Giles, the U.S. Environmental Protection Agency’s (EPA) Assistant Administrator for Enforcement and Compliance Assurance. “This case, like other recent ones, supports legitimate businesses and makes clear to potential violators that EPA and its partners will fight to protect the program’s integrity.”
“With this guilty plea, the defendant admitted that he participated in a conspiracy to defraud the United States government, specifically the EPA, and that he personally gained more than $7 million from the scheme,” said U.S. Attorney Dan Bogden for the District of Nevada. “These types of schemes are complex and require an enormous expenditure of resources to investigate and prosecute. Because of the tremendous work of the investigators and prosecutors on this case, we were also able to seize and forfeit from the defendant millions of dollars from bank accounts, as well as real property in Nevada and California, jewelry and other assets.”
The Energy Independence and Security Act of 2007 created a number of federally-funded programs that provided monetary incentives for the production and use of renewable fuels such as biodiesel in the United States. Biodiesel producers and importers can generate and attach credits known as “renewable identification numbers,” or RINs. to the gallons of biodiesel they produce or import. Because certain companies (such as companies that sell transportation fuel in the United States) need RINs to comply with regulatory obligations, RINs have significant market value. They are routinely bought and sold in the marketplace. In addition, to ensure that RINs are generated for renewable fuel used only in the United States, and in order to create an incentive for biodiesel in the United States to be used here, anyone who exports biodiesel is required to obtain these valuable RINs for all exported gallons and provide the RINs to EPA.
Stoliar admitted that beginning around September of 2009, he and co-defendant James Jariv operated and controlled a company -- City Farm Biofuel in Vancouver, British Columbia, Canada -- that represented itself as a producer of biodiesel from “feedstocks” such as animal fat and vegetable oils. Stoliar and Jariv also formed a company called Canada Feedstock Supply – that represented itself as City Farm’s supplier of feedstocks necessary to produce biodiesel. Jariv operated and controlled a company based in Las Vegas called Global E Marketing (GEM). Using these three and other closely-held companies, Stoliar and his codefendants claimed to produce biodiesel at the City Farm facility and to import and sell biodiesel to GEM, and then generated and sold RINs based upon this claimed production, sale and importation. In reality, no biodiesel produced at City Farm was ever imported and sold to GEM as claimed. Stoliar and his codefendants used GEM to claim to blend the biodiesel with petroleum diesel, allowing them to sell the RINs separately from any actual biodiesel. Using this scheme, Stoliar and his co-defendants falsely claimed to import, purchase and blend more than 4.2 million gallons of biodiesel. They then sold the RINs, and fraudulently generated more than $7 million.
The indictment also alleges that, beginning around the same time period and continuing through Dec. 31, 2013, Stoliar and Jariv, using their company MJ Biodfuel, bought over 23 million gallons of RIN-less biodiesel that had been blended with small amounts of petroleum diesel to form B-99. The defendants bought the B-99 from unrelated companies in the United States, and this B-99 had been used by other companies to generate and separate RINs from the fuel. Because B-99 cannot be used to again generate a RIN, and because it cannot be used for other tax-related incentives, B-99 sells for substantially less than 100 percent biodiesel (known as B-100). Stoliar sold some of this biodiesel to purchasers in the United States, claiming it was B-100 produced at the City Farm facility and imported into the United States. By claiming this biodiesel was B-100 and not RIN-less B-99, Stoliar marketed the fuel as eligible to be used by purchasers to generate credits and incentives, and Stoliar was able to sell the fuel for as much as $2.30 per gallon more than he otherwise would have been able.
Stoliar and his co-defendants also exported significant amounts of the RIN-less B-99 they bought in the United States to Canada. Stoliar then sold the biodiesel in Canada, and conspired with his co-defendants to not acquire and provide RINs to the United States for these exports as they were required to do by law. In doing so, Stoliar and Jariv failed to give to the United States RINs worth in excess of $34 million, keeping this money for themselves instead.
Finally, Stoliar and Jariv conspired to launder the proceeds of their crimes, utilizing foreign banking institutions and complex financial transactions to promote their illegal schemes and distribute the proceeds of their crimes. Accounts were utilized in Canada, Nevada and Australia, and transactions between the defendants’ closely-held companies were described as other legitimate transactions involving biodiesel, when in reality they were not.
Sentencing for Stoliar has been set for Oct. 30,2014 in Las Vegas, Nevada. The investigation that led to today’s plea was the result of collaborative work by the EPA’s Criminal Investigation Division and the FBI, with assistance from the United States Secret Service, the Internal Revenue Service-Criminal Investigations and the Department of Homeland Security.
The case is being prosecuted by Assistant Chief Wayne D. Hettenbach of the Environmental Crimes Section of the Justice Department’s Environment and Natural Resources Division , Assistant U.S. Attorney’s Crane M. Pomerantz and Daniel D. Hollingsworth of the U.S. Attorney’s Office in Nevada, and Assistant Deputy Chief Darrin L. McCullough of the Justice Department’s Criminal Division, Asset Forfeiture and Money Laundering Section, with the assistance of the Justice Department’s Office of International Affairs and the United States Attorney’s Office for the Southern District of Texas .Australian Man Pleads Guilty in Las Vegas to Biofuels Fraud SchemeRead the Press Release
WASHINGTON – Nathan Stoliar, 64, of Australia, pleaded guilty in federal court in Las Vegas today to five felonies for his role in multiple schemes, worth in excess of $41 million, to generate fraudulent biodiesel credits and to export biodiesel without providing biodiesel credits to the United States as required by law.
Stoliar and another defendant had been charged in January 2014 in a 57-count indictment alleging conspiracy, wire fraud, false statements under the Clean Air Act, obstruction of justice and conspiracy to engage in money laundering. Following his indictment, Stoliar’s arrest was sought by the United States. Located in Poland, Stoliar returned in early February to the United States to surrender for arrest. Stoliar pleaded guilty Tuesday to one count of conspiracy, one count of conspiracy to engage in money laundering, two counts of wire fraud and one count of making false statements under the Clean Air Act. Stoliar is required by the plea to forfeit $4 million and pay $1 million in restitution. He faces a maximum sentence of 20 years in prison and a $500,000 fine for each count of conspiracy to engage in money laundering and wire fraud, five years in prison and a $250,000 fine for conspiracy, and two years in prison and a $250,000 fine for making false statements under the Clean Air Act.
“Stoliar and his co-conspirator perpetrated a massive fraud against a renewable fuels program created to protect our nation’s energy security and independence,” said Sam Hirsch, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. “The Justice Department will continue to pursue fraudsters at home and abroad and protect the integrity of federal programs as it protects the environment.”
“By rooting out fraud, EPA is committed to achieving the environmental goals that Congress envisioned when it created the Renewable Fuel Standard,” said Cynthia Giles, the U.S. Environmental Protection Agency’s (EPA) Assistant Administrator for Enforcement and Compliance Assurance. “This case, like other recent ones, supports legitimate businesses and makes clear to potential violators that EPA and its partners will fight to protect the program’s integrity.”
“With this guilty plea, the defendant admitted that he participated in a conspiracy to defraud the United States government, specifically the EPA, and that he personally gained more than $7 million from the scheme,” said Dan Bogden, U.S. Attorney for the District of Nevada. “These types of schemes are complex and require an enormous expenditure of resources to investigate and prosecute. Because of the tremendous work of the investigators and prosecutors on this case, we were also able to seize and forfeit from the defendant millions of dollars from bank accounts, as well as real property in Nevada and California, jewelry and other assets.”
The Energy Independence and Security Act of 2007 created a number of federally-funded programs that provided monetary incentives for the production and use of renewable fuels such as biodiesel in the United States. Biodiesel producers and importers can generate and attach credits known as “renewable identification numbers,” or RINs. to the gallons of biodiesel they produce or import. Because certain companies (such as companies that sell transportation fuel in the United States) need RINs to comply with regulatory obligations, RINs have significant market value. They are routinely bought and sold in the marketplace. In addition, to ensure that RINs are generated for renewable fuel used only in the United States, and in order to create an incentive for biodiesel in the United States to be used here, anyone who exports biodiesel is required to obtain these valuable RINs for all exported gallons and provide the RINs to EPA.
Stoliar admitted that beginning around September of 2009, he and co-defendant James Jariv operated and controlled a company -- City Farm Biofuel in Vancouver, British Columbia, Canada -- that represented itself as a producer of biodiesel from “feedstocks” such as animal fat and vegetable oils. Stoliar and Jariv also formed a company called Canada Feedstock Supply – that represented itself as City Farm’s supplier of feedstocks necessary to produce biodiesel. Jariv operated and controlled a company based in Las Vegas called Global E Marketing (GEM). Using these three and other closely-held companies, Stoliar and his codefendants claimed to produce biodiesel at the City Farm facility and to import and sell biodiesel to GEM, and then generated and sold RINs based upon this claimed production, sale and importation. In reality, no biodiesel produced at City Farm was ever imported and sold to GEM as claimed. Stoliar and his codefendants used GEM to claim to blend the biodiesel with petroleum diesel, allowing them to sell the RINs separately from any actual biodiesel. Using this scheme, Stoliar and his co-defendants falsely claimed to import, purchase and blend more than 4.2 million gallons of biodiesel. They then sold the RINs, and fraudulently generated more than $7 million.
The indictment also alleges that, beginning around the same time period and continuing through Dec. 31, 2013, Stoliar and Jariv, using their company MJ Biodfuel, bought over 23 million gallons of RIN-less biodiesel that had been blended with small amounts of petroleum diesel to form B-99. The defendants bought the B-99 from unrelated companies in the United States, and this B-99 had been used by other companies to generate and separate RINs from the fuel. Because B-99 cannot be used to again generate a RIN, and because it cannot be used for other tax-related incentives, B-99 sells for substantially less than 100 percent biodiesel (known as B-100). Stoliar sold some of this biodiesel to purchasers in the United States, claiming it was B-100 produced at the City Farm facility and imported into the United States. By claiming this biodiesel was B-100 and not RIN-less B-99, Stoliar marketed the fuel as eligible to be used by purchasers to generate credits and incentives, and Stoliar was able to sell the fuel for as much as $2.30 per gallon more than he otherwise would have been able.
Stoliar and his co-defendants also exported significant amounts of the RIN-less B-99 they bought in the United States to Canada. Stoliar then sold the biodiesel in Canada, and conspired with his co-defendants to not acquire and provide RINs to the United States for these exports as they were required to do by law. In doing so, Stoliar and Jariv failed to give to the United States RINs worth in excess of $34 million, keeping this money for themselves instead.
Finally, Stoliar and Jariv conspired to launder the proceeds of their crimes, utilizing foreign banking institutions and complex financial transactions to promote their illegal schemes and distribute the proceeds of their crimes. Accounts were utilized in Canada, Nevada and Australia, and transactions between the defendants’ closely-held companies were described as other legitimate transactions involving biodiesel, when in reality they were not.
Sentencing for Stoliar has been set for is Oct. 30, 2014 in Las Vegas, Nevada. The investigation that led to today’s plea was the result of collaborative work by the EPA’s Criminal Investigation Division and the FBI, with assistance from the United States Secret Service, the Internal Revenue Service-Criminal Investigations and the Department of Homeland Security.
The case is being prosecuted by Assistant Chief Wayne D. Hettenbach of the Environmental Crimes Section of the Justice Department’s Environment and Natural Resources Division, Assistant U.S. Attorney’s Crane M. Pomerantz and Daniel D. Hollingsworth of the U.S. Attorney’s Office in Nevada, and Assistant Deputy Chief Darrin L. McCullough of the Justice Department’s Criminal Division, Asset Forfeiture and Money Laundering Section, with the assistance of the Justice Department’s Office of International Affairs and the United States Attorney’s Office for the Southern District of Texas.Ashton Man Sentenced to 5 Years for Distributing Child PornographyRead the Press Release
A man who distributed child pornography was sentenced July 17, 2014, to five years in federal prison.
Todd Techen, age 22, of Ashton, Iowa, received the sentence after an April 17, 2014, guilty plea to one count of distribution of child pornography. At the guilty plea hearing, Techen admitted that, between 2012 and January 2013, he knowingly distributed child pornography.
Techen was sentenced in Sioux City by United States District Court Judge Mark W. Bennett. Techen was sentenced to 60 months’ imprisonment. A special assessment of $100 was imposed, and Techen must also serve a ten-year term of supervised release. He must comply with all sex offender registration and public notification requirements.
This case was prosecuted by Assistant United States Attorney Mark Tremmel and was investigated by the Iowa Division of Criminal Investigation, the Federal Bureau of Investigation, and the Lyon County Sheriff’s Office.
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.”
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is CR 13-4079.
Ashland Man Sentenced to 30 Years in Prison for Labor Trafficking ConspiracyRead the Press Release
An Ashland, Ohio, man was sentenced to 30 years in prison for holding a woman with cognitive disabilities and her child against their will and forcing the woman to perform manual labor for them, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland office.
Jordie L. Callahan, 28, and Jessica L. Hunt, 33, were convicted in March following a three-week trial before U.S. District Judge Benita Y. Pearson. Callahan and Hunt were both convicted on one count each of conspiracy to violate laws; forced labor and acquiring a controlled substance by deception.
“Mr. Callahan, through his cruelty, sought to deprive the victims in this case of their dignity and their freedom,” U.S. Attorney Dettelbach said. “He failed in the former, and the victim’s strength ended up trumping his. As for the freedom part – now it is the defendant whose freedom will be taken, for a long time.”
“Hopefully this well-deserved lengthy sentence will provide a sense of justice that will assist the victims in their ongoing healing process,” Special Agent in Charge Anthony said.
Hunt is scheduled to be sentenced by Judge Pearson on July 24.
Daniel J. Brown, 35, and Dezerah L. McGuire (formerly Silsby), 33, also of Ashland, both previously pleaded guilty to related crimes are serving sentences in federal prison. Brown was sentenced to five years in prison and McGuire was sentenced to nearly four years in prison.
Callahan and Hunt used a combination of violence, threats, sexual assaults, humiliation, deprivation and monitoring to establish and continue a pattern of domination and control over their victims, identified only as S.E. and B.E., according to the court documents and trial testimony.
Their tactics included beating S.E., threating to beat to S.E. and B.E., taunting and threatening the victims with pit bulls and snakes, causing the victims to sleep in unsafe and unsanitary conditions, restricting B.E. and S.E.’s access to the bathroom, preventing them from eating regular and suitable meals and forcing S.E. to eat dog food and crawl on the floor while wearing a dog collar, according to the court documents and trial testimony.
According to court documents and trail testimony:
Callahan pointed a firearm at S.E.’s head and threatened to kill her if she did not perform the labor and services he and other conspirators commanded. Callahan also forced S.E. on multiple occasions to engage in sex acts with him and threatened that he and Hunt would kill S.E. if she told anyone about the forced sexual acts.
The conspiracy between Callahan, Hunt, McGuire and Brown took place between August 2010 and October 2012. The object of the conspiracy included holding S.E. in a condition of forced labor and involuntary servitude and intentionally causing painful injuries to S.E. so they could use the narcotic pain medications she was prescribed to satisfy their personal drug cravings.
Callahan and Hunt recruited S.E. and B.E. to live with them in their two-bedroom apartment in Ashland, knowing that S.E. suffered a traumatic brain injury that left her with a cognitive disability and that S.E. and B.E. received monthly public assistance payments.
In August 2011, McGuire, at the direction of Callahan and Hunt, smashed S.E.’s hand with a rock with such force that S.E. needed to go to the hospital emergency room. Callahan, Hunt and McGuire then forced S.E. to give them the narcotic pain pills and prescription for narcotic pain pills she obtained after being treated at the emergency room.
In December 2011, Callahan and Hunt injured S.E.’s back with such force that she needed medical treatment. Again, Callahan and Hunt forced S.E. to give them the narcotic pain pills and prescription for narcotic pain pills she obtained after being treated.
In March 2012, Callahan kicked S.E. in the hip with such force that she needed medical treatment. Callahan and Hunt forced S.E. to give them the narcotic pain pills and prescription for narcotic pain pills she obtained after being treated.
On multiple occasions between August 2010 and October 2012, Callahan and Hunt threatened S.E. and B.E. with serious physical harm, including death, if S.E. did not clean up the apartment, care for their numerous pit bull dogs, snakes and other reptiles, purchase items at the store and perform other labor and services ordered by the conspirators.
Callahan and Hunt used a video camera to monitor S.E. and B.E.’s activities and conversations in the apartment. They often forced S.E. to walk to the store to buy groceries, cigarettes, dog food and other items for Callahan, Hunt and Hunt’s four sons and to pay for these purchases with her public assistance card. They allotted S.E. only a brief time period to complete the shopping and warned her she was not allowed to speak with anyone while she was out. They frequently required B.E. to remain with them at the apartment while S.E. was out and threatened physical harm to B.E. and S.E. if S.E. broke any of their rules.
Callahan and Hunt also threatened to contact Ashland County Job and Family Services and have B.E. taken away if S.E. purchased any items at the store other than those they ordered or if she told anyone about their unlawful conduct.
In June 2011, after S.E. and B.E. had attempted to flee the apartment, Callahan and Hunt ordered Brown and McGuire to find S.E. and B.E. and bring them back to the apartment. Brown and McGuire lured S.E. and B.E. into their vehicle by promising to take them to Dairy Queen, only to deposit them afterwards back at the apartment.
On multiple occasions, Callahan and Brown locked S.E. and B.E. in a room with a window that was nailed shut and a door that had been locked from the outside.
In October 2011, Callahan and Hunt forced S.E. to hit her child while they recorded a video, and threatened to inflict much greater physical harm on both S.E. and B.E. if S.E. did not comply.
One month later, Callahan and Hunt again forced S.E. to strike B.E. while they captured a video recording of the staged incident on Callahan’s cell phone. Callahan and Hunt repeatedly threatened have B.E. taken away by showing the videos to authorities in order to secure S.E.’s compliance to the conspirators’ commands.
The case was prosecuted by Assistant U.S. Attorneys Chelsea Rice and Thomas E. Getz following an investigation by the FBI and Ashland Police Department, with assistance from the Ashland County Prosecutor’s Office.
Additional Charges Filed Against Stockbroker in Connection with Alleged Investment SchemeRead the Press Release
PHILADELPHIA – A second superseding indictment was filed today charging William Bucci, 57, of Philadelphia, PA, with running an investment fraud scheme that duped victims into turning over more than $3.2 million, announced United States Attorney Zane David Memeger. According to the indictment, Bucci told his victims he was starting a wine and high end olive oil import business. Among his one dozen victims was a Catholic Priest. The indictment charges securities fraud, four counts of mail fraud, one count of mortgage fraud, and an additional count of making and subscribing false federal income tax returns. A previous indictment charged Bucci with four counts of making and subscribing false federal income tax returns for underreporting his income for the tax years 2007 through 2010.
According to the indictment, beginning as early as 2004, Bucci represented to his brokerage clients-victims that he was starting a business to import high end olive oil and wine from Italy. But Bucci, who was a licensed stockbroker and a non-lawyer elector on the Pennsylvania Court of Judicial Discipline, never had an olive oil and wine business. He allegedly promised the clients a rate of return of at least 10% on their investment. He also falsely guaranteed to the investors that he would repay principal and interest. Bucci also allegedly solicited other individuals to loan him money for the purchase of real estate. According to the indictment, Bucci used funds from these individuals to support his lifestyle and to make payments to earlier victims. In total, the indictment alleges that victims entrusted in excess of $3.2 million to Bucci between November 2003 and December 2011.
The indictment further alleges that Bucci filed false federal income tax returns, underreporting his income, for the tax years 2007 through 2011. It is further alleged that, in 2012, Bucci provided false documents to Beneficial Mutual Savings Bank in connection with a mortgage that Beneficial held on a property that Bucci owned in Brigantine, New Jersey.
If convicted the defendant faces a maximum possible sentence of 145 years in prison, restitution, a fine of up to $8.25 million, and up to five years of supervised release.
The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service Criminal Investigations. It is being prosecuted by Assistant United States Attorney David J. Ignall.
Click here to view the indictment
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-852510th Street Associate Pleads Guilty to Drug ChargeRead the Press Release
BUFFALO, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that Chazity Fluellen, 27, of Buffalo, N.Y., pleaded guilty before U.S. District Judge Richard J. Arcara to maintaining a drug involved premises. The charge carries a maximum penalty of 20 years in prison, a fine of $500,000, or both.
Assistant U.S. Attorney Joseph M. Tripi, who handled the case, stated that the defendant and co-defendant, 10th Street Gang member Desmond Ford, used and maintained the premises at 23 10th Street in Buffalo for the purpose of storing and distributing cocaine and crack cocaine. During a search of the property on June 18, 2010, officers recovered quantities of cocaine and crack cocaine, packaging material, a scale, and cellular phones.
Fluellen is one of 40 members or associates of the 10th Street Gang who have been convicted as a part of this federal investigation. As a part of the plea, the defendant will forfeit the residence at 23 10th Street to federal authorities.
The plea is the culmination of an investigation on the part of Special Agents of the Federal Bureau of Investigation, the New York State Police, under the direction of Major Michael Cerretto, the Buffalo Police Department, under the direction of Commissioner Daniel Derenda, and the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Resident Agent in Charge Frank Christiano.
Sentencing is scheduled for October 27, 2014 at 1:00 p.m. before Judge Arcara.10 Individuals Indicted for Drug Trafficking and Money LaunderingRead the Press Release
SAN JUAN, Puerto Rico – On July 16, 2014, a federal grand jury in the District of Puerto Rico returned an indictment against 10 defendants charged with distribution of a controlled substance for purpose of unlawful importation, announced Rosa Emilia Rodríguez-Vélez, United States Attorney for the District of Puerto Rico. Drug Enforcement Administration is in charge of the investigation.
The indictment charges 10 individuals with conspiracy to knowingly and intentionally distribute and cause the distribution of five kilograms or more of cocaine, intending and knowing that such cocaine would be unlawfully imported to the United States, all for significant financial gain and profit. The defendants are: Javier Carrillo, aka “Cara Ancha,” “Ojos Lindos;” Alex Rudolph Antonio Reed, aka “Feo;” José Ángel Burgos-Rodríguez, aka “Che,” “Dragoncito;” Héctor Manuel Pérez-Arizmendi, aka “Cachete;” José Miguel Rodríguez; Carlos Gilberto Miranda-Ríos, aka “El Gordo;” Delfin Robles-Álvarez, aka “El Indio;” Nelson Tomas Feliciano-Collazo, Wilfredo Eli Rivera-Zayas; and Julio Mejía-Leyva.
The indictment alleges that beginning in 2005, the organization distributed wholesale and retail amounts of cocaine throughout Puerto Rico and continental United States. The defendants would obtain large amounts of cocaine in Saint Martin, Netherlands Antilles, which was then transported to Puerto Rico on board maritime vessels, commercial cargo planes, and private aircraft. They would also transport large sums of U.S. currency via aircraft and motor vessel to Saint Martin for the purchase of large quantities of cocaine and use the blackberry messenger application as well as other means of communication to communicate with each other.According to the indictment, in or about the year 2010, the defendants conspired to transport more than $12,000,000 in United States currency from Puerto Rico to Saint Martin, Netherland Antilles, knowing that the monetary instruments of funds involved in the transportation represented the proceeds of dealing in controlled substances.
Some of the defendants also laundered drug proceeds through the Puerto Rico Lottery. As part of the manner and means of this money laundering conspiracy, the defendants and their co-conspirators had a point of contact within the Puerto Rico Lottery who would corruptly offer winning lottery tickets before they were claimed. Burgos-Rodríguez, Miranda-Ríos and Robles-Álvarez would purchase the winning lottery tickets with proceeds from the cocaine sales, for the price of the winning ticket plus a twenty percent commission. The defendants would redeem the winning ticket as though it had always been their own. The lottery would then issue a check for the winning amount to the co-conspirator who claimed the ticket, who could then deposit the check in their bank account as actual earned income, thereby laundering the underlying drug proceeds.In addition to the money judgment of 127 million dollars the defendants are facing, they have to forfeit a property located at Barrio Hato Tejas, Bayamón, PR; and two airplanes, an Aerostar-601 and a Cessna 340A.
“This drug trafficking organization was involved in a conspiracy to traffic massive quantities of illegal drugs into the United States,” said Rosa Emilia Rodríguez-Vélez, U.S. Attorney for the District of Puerto Rico. “These arrests demonstrate the Justice Department’s commitment to hold ruthless cartel leaders responsible for importing narcotics into the United States – no matter where they conduct their illegal business. Along with our domestic and international law enforcement partners, we will ensure that cartel members and associates are brought to justice for the damage they inflict on both sides of the border.”
“DEA will continue to investigate, disrupt and dismantle drug trafficking organizations operating out of Colombian and other parts of South America using the Caribbean Region as a transshipment point to smuggle narcotics into the United States,” said Pedro Janer, Acting Special Agent in Charge of the DEA Caribbean Division.
Assistant U.S. Attorney Mariana Bauzà is in charge of the prosecution of the case. If convicted the defendants face a minimum sentence of 10 years up to life in prison. Indictments contain only charges and are not evidence of guilt. Defendants are presumed to be innocent until and unless proven guilty.# # #