Latest Records
Newest first across public DOJ and U.S. Attorney press releases.
3 September 2014
Glendale California Man Sentenced in Multimillion Dollar Health Insurance Fraud SchemeRead the Press Release
FARGO - U. S. Attorney Timothy Q. Purdon announced that on Sept. 3, 2014, Hovakim David Mkhitarian, 31, Glendale, Calif., was sentenced before U. S. District Judge Ralph R. Erickson to serve seven months in prison and seven months electronic home monitoring for charges of conspiracy to commit health care fraud. Mkhitarian was also ordered to pay $2000 in restitution and a $100 special assessment to the Crime Victims Fund.
Mkhitarian pleaded guilty on Sept. 25, 2013 and was a mid-level participant involved in the day-to-day operation of a health care fraud scheme that submitted in excess of $13 million of fraudulent claims to Medicare and caused more than $3 million of losses to the program. The sophisticated scheme, which was based out of Los Angeles, recruited foreign students who were traveling in the United States on summer work visas. The students were driven around the United States to open up bank accounts and commercial mail boxes for dozens of phantom medical clinics. After the students returned home, conspirators submitted fictitious claims to Medicare using wrongfully-obtained physician billing numbers and thousands of Medicare numbers. Medicare deposited payments into accounts opened by the foreign students, who pre-signed checks so that conspirators could withdraw the deposited funds. Money from the scheme was laundered through check cashing businesses, real estate, and gold dealers.
Two co-conspirators also pleaded guilty today to charges of conspiracy to commit health care fraud; Tigran Yusufyan and Hovakim John Mkhitarian. Sentencing for Yusufyun will be held on Dec. 8, 2014, at 11:00 a.m. and sentencing for John Mkhitarian will be on Feb. 23, 2015 at 1:30 p.m. U. S. District Court. A fourth member of the conspiracy, Levon Gevorgyan is scheduled to be sentenced for his role in the offense on November 10, 2014 at 2:15 p.m.
This case was jointly investigated by the Office of Inspector General, Department of Health and Human Services, and the United States Diplomatic Security Service, Department of State.
Special Assistant United States Attorney Matthew Greenley prosecuted the case. His position is funded through a partnership between the Department of Health and Human Services, Office of Inspector General, and the United States Attorney’s Office for the District of North Dakota. In that position, Mr. Greenley prosecutes criminal cases relating to programs under the United States Department of Health and Human Services, including the Medicare program. Medicare contracts with Noridian Healthcare Solutions, LLC, in Fargo, North Dakota, to process and pay Medicare claims in addition to other healthcare administrative services.
Fourteen Individuals Indicted Federally for Drug Trafficking in WilmingtonRead the Press Release
WILMINGTON – United States Attorney Thomas G. Walker announced today that fourteen individuals from Wilmington have been charged in Criminal Indictments in connection with drug trafficking offenses. VICTOR FRANCISO VALLADARES, 32, JUSTICE DEVON PRICE, 24, SHAMIKA TARONA FENNELL, 27, TONY SHAHEEN DAVIS, 37, VICTOR MANUEL DAVILA, 55, DEMOND NAKAI FLOWERS, 42, PEARLIE ARMSTRONG, 48, RONALD LEE HARRY, 34and ALICIA DRAYTON, 25 were charged in a 31 Count Indictment as part of an organization that distributed large quantities of heroin, phencycline (PCP), and engaged in money laundering. Additionally, JERMAINE DALE ROGERS, 36, HARLEE BARSHEEN TOMER, 40, PATRICK MCMILLIAN BRAGG, 28, TYQUAWN WASHINGTON, 21 and VINCENT BRUCE JACKSON, 50 were charged in separate Criminal Indictments for offenses related to the distribution of heroin. Initial appearances were held in Wilmington today for ten of the defendants indicted.
If convicted on the offenses, the defendants could face maximum penalties of between 20 years and life imprisonment.
"Street gangs spread violence and fear throughout our communities. While dismantling gangs has long been a priority for the FBI, we are working with our law enforcement partners with increased manpower and increased urgency to address current threats across our state. This investigation is an outstanding example of what federal, state, and local law enforcement can accomplish when we attack the gangs that operate in our neighborhoods," said John Strong, Special Agent in Charge of the FBI in North Carolina.
Wayne Dixie, Special Agent in Charge of ATF stated, “Under the Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF) “Frontline” initiative we will vigorously work with our federal, state and local law enforcement partners to ensure gang members that use violence against civilians and law enforcement officers are brought to justice. I believe the law enforcement community has come to realize that we all must deal with gang violence and that the only way we’re going to win against gangs is by working together. Subsequently, the joint investigation into this violent gang and today’s joint operations to apprehend them reflects ATF’s and our law enforcement partners resolve to reduce gang violence.”
"Today's arrests represent months of hard work and cooperation through a multi-agency effort, says Ralph Evangelous, Wilmington Chief of Police "Our long-time partnerships with federal, state and local law enforcement were critical to the success of this investigation. I commend all who were involved in removing these violent offenders from our streets and making Wilmington a safer place for all."
The case is being investigated by the Federal Bureau of Investigation Wilmington, Bureau of Alcohol, Tobacco, Firearms, & Explosives (ATF) Wilmington, the United States Marshals Service, Immigration and Custom Enforcement’s Homeland Security Investigations, the Wilmington Police Department and the New Hanover County Sheriff’s Office. The United States Attorney’s Office for the Eastern District of North Carolina is handling the prosecution of these cases.
The charges contained in this indictment are allegations. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
See the attached indictment for additional information.
Former Vice President of the Wine Tasting Network Sentenced to 33 Months in Embezzlement CaseRead the Press Release
SAN FRANCISCO – Martin Christopher Edwards was ordered to serve a 33 month prison sentence yesterday, and ordered to pay $894,222 in restitution to the WineTasting Network for his involvement in an embezzlement and tax evasion scheme, announced U.S. Attorney Melinda Haag, FBI Special Agent in Charge David J. Johnson, and IRS Special Agent in Charge Jose M. Martinez.
Edwards, 49, pleaded guilty on April 16, 2014, to a two-count information that charged him with mail fraud, in violation of Title 18, United States Code, Section 1341, and tax evasion, in violation of Title 26, United States Code, Section 7201.
According to the plea agreement, Edwards was the Vice President and General Manager of the WineTasting Network, when he created Dufrane Compliance Trust, a fictitious entity that purported to provide compliance services to wineries and wine retailers. Edwards directed the WineTasting Network to make payments to the Dufrane Compliance Trust totaling approximately $894,000. Edwards falsely represented to WineTasting Network employees that these payments were for tax compliance services rendered by Dufrane Compliance Trust, when, in fact, no such services were rendered. Edwards deposited those funds into an account that he controlled and then used the money for his own personal expenses, including the purchase of a BMW, vacations, meals, and a cruise. In addition, during tax years 2010, 2011, and 2012, Edwards did not declare any of the monies he diverted to the account he controlled on his federal income tax returns. The plea agreement also included an enhancement for obstruction of justice for Edwards’s flight to Mexico to avoid prosecution for these crimes.
The sentence was handed down by the Honorable William Alsup, United States District Judge in San Francisco. Judge Alsup also sentenced Edwards to a three-year term of supervised release. The defendant has been in custody since Jan. 20, 2014.Kim A. Berger and Arvon Perteet are the Assistant U.S. Attorneys who are prosecuting the case with the assistance of Rawaty Yim and Bridget Kilkenney. This prosecution is the result of an investigation by the FBI, and the Internal Revenue Service, Criminal Investigation Division.
(Edwards information )
(Edwards indictment )
Former Union Official Pleads Guilty to Embezzling Money from UnionRead the Press Release
ALBUQUERQUE – Leonard Bridge, II, 44, of Albuquerque, N.M., pled guilty yesterday to embezzling assets from a labor organization. Under the terms of the plea agreement, the parties will recommend that the court sentence Bridge to a prison term within the range of 12 to 24 months followed by a term of supervised release to be determined by the court. Bridge also will have to pay $140,877.56 in restitution to the union.
Bridge was indicted in Feb. 2014 and charged with 20 counts of embezzlement of assets from a labor organization. According to the indictment, Bridge embezzling money belonging to the International Union of Elevator Constructors, Local 131, on 20 separate occasions between April 2009 and Aug. 2011. Bridge perpetrated his embezzlement scheme by writing checks on the Union’s bank account, making case withdrawals with a debit card, and making cash withdrawals from the bank account. Bridge was employed as the business manager for the Union from Jan. 2009 through Nov. 2011.
During yesterday’s hearing, Bridge entered a guilty plea to Count 1 of the indictment. In his plea agreement, Bridge admitted while he was the union’s business manager, he was responsible for the day-to-day operations of the union and that his financial responsibilities included preparing and signing check on the union’s bank accounts, making disbursements, maintaining financial records, and reporting on the union’s finances to the union’s board and membership. Bridge admitted that while serving as the union’s business manager, he embezzled union funds for his own use. Bridge accomplished the embezzlement in a variety of ways, including paying himself excess salary, writing unauthorized checks to himself, making unauthorized purchases on the union’s debit card, and making unauthorized cash withdrawals from the union’s bank account. Bridge acknowledged that when he took office, the union had approximately $106,000.00 in its general account; when he resigned, the general account had $2,400.00.
This case was investigated by the Office of Labor-Management Standards of the U.S. Department of Labor and is being prosecuted by Assistant U.S. Attorney C. Paige Messec.
Former U.S. Border Patrol Agent Pleads Guilty to Possession of Child PornographyRead the Press Release
ALBUQUERQUE – Abel Michael Quiroz, 27, a former U.S. Border Patrol Agent who resides in Las Cruces, N.M., pleaded guilty today to possession of a matter containing visual depictions of minors engaged in sexually explicit conduct. Under the terms of his plea agreement, Quiroz will be sentenced to 30 months in prison followed by a term of supervised release to be determined by the court. Quiroz also will be required to register as a sex offender.
Quiroz was arrested on April 29, 2014, on a criminal complaint charging him with receiving and possessing visual depictions of minors engaged in sexually explicit conduct. According to the criminal complaint, Homeland Security Investigations (HSI) initiated an investigation into Quiroz after receiving information that an adult male, later confirmed to be Quiroz, was having inappropriate communications with a 15-year-old child (victim).
The complaint alleges that execution of a search warrant for the contents of an email address belonging to Quiroz revealed numerous sexually explicit communications between Quiroz and the victim as well as nude and sexually explicit photographs of the victim. On April 29, 2014, HSI special agents executed a federal search warrant at Quiroz’s residence where they seized digital media and arrested Quiroz. There is no evidence suggesting that Quiroz’s criminal activities were conducted with government-owned equipment or technology.
During today’s plea hearing, Quiroz entered a guilty plea to a felony information charging him with possession of child pornography. In his plea agreement, Quiroz admitted that from Feb. 2013 through Oct. 2013, he communicated with the victim, whom he knew to be a minor residing in a state other than New Mexico, through online chats, mail, email, telephone conversations and text messages. Quiroz admitted receiving sexually explicit photographs of the victim via email and unlawfully possessing the photographs in his email account.
This case was investigated by the Child Exploitation Unit of HSI’s office in Las Cruces pursuant to Project iGuardian, an HSI initiative designed to reach children, parents and teachers and share information about the dangers of online environments, how to stay safe online and how to report abuse and suspicious activity. The Las Cruces Police Department assisted in the prosecution of this case.
The case is being prosecuted by Assistant U.S. Attorney Alexander Shapiro of the U.S. Attorney’s Las Cruces Branch Office 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 Operation also was brought as a part of the New Mexico Internet Crimes Against Children (ICAC) Task Force’s mission, which is to locate, track, and capture Internet child sexual predators and Internet child pornographers in New Mexico. There are 74 federal, state and local law enforcement agencies associated with the New Mexico ICAC Task Force, which is funded by a grant administered by the NMAGO. Anyone with information relating to suspected child predators and suspected child abuse is encouraged to contact federal or local law enforcement.
Former Suburban Chiropractor and His Wife Sentenced to Federal Prisonfor $1 Million Health Insurance Fraud SchemeRead the Press Release
CHICAGO ― A former suburban chiropractor and his wife, who was a fitness instructor and personal trainer, were sentenced to federal prison terms for engaging in a $1 million health insurance fraud scheme that continued for a year after they were indicted in 2011. WENDY CARR, 43, was sentenced today to 28 months in prison, a week after her husband, ANDREW CARR, 45, both of Lake in the Hills, was sentenced to eight years in prison.
Andrew Carr worked as a chiropractor at Premier Health in Palatine, Community Physical Medicine and Rehabilitation in Mundelein, Allied Health in Mundelein, Edgewater Rehabilitation and Wellness Center in Lake in the Hills, and Fusion Health and Fitness in Lakemoor.
“They pretended to be the victim patients’ friends, convinced the victim patients to take their fitness classes, and convinced the victim patients to get treatment from [Andrew Carr] when the classes caused physical pain or injury,” Assistant U.S. Attorney Shoba Pillay argued at sentencing.
Between 2005 and June 2011, Andrew Carr submitted health insurance claim forms for at least 376 patients to six different private health care insurers, knowing that more than $4.2 million worth of claims were for services that were not provided, and as a result, he fraudulently obtained payments totaling approximately $865,697.
Between January 2009, when Wendy Carr joined the scheme, and June 2011, she processed the insurance claims, knowing that nearly $1.6 million worth of claims were for services that were not provided, and, as a result, the couple fraudulently obtained payments during that time totaling approximately $328,964.
After the couple were indicted in June 2011, they submitted an additional 596 fraudulent claims totaling more than $475,000 for 51 additional patients over another year and, as a result, fraudulently obtained an additional $164,168. Each pleaded guilty to health care fraud earlier this year.
Andrew Carr was ordered to pay restitution totaling $1,029,865, and Wendy Carr was ordered to pay $493,132 in restitution by U.S. District Judge Robert M. Dow, Jr., who imposed the sentences in Federal Court. The restitution was ordered to be paid to the victim insurance companies ― Aetna, Inc., Allied Insurance, Blue Cross Blue Shield of Illinois, CIGNA, Professional Benefit Administrators, Inc., and United Healthcare, some of which provided coverage through union health and welfare funds they administered in the Chicago area.
Andrew Carr, who was sentenced on Aug. 25, has been in federal custody for approximately two years. Wendy Carr, was sentenced today and was ordered to begin serving her 28-month sentence on June 25, 2015, to be followed by six months of home detention.
The sentences were announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois, and Robert J. Holley, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of investigation; James Vanderberg, Special Agent-in-Charge of the U.S. Department of Labor Office of Inspector General in Chicago; and Donna J. Seermon, Acting Regional Director in Chicago of the U.S. Department of Labor’s Employee Benefits Security Administration.
Former Grosse Pointe Attorney Sentenced for Bank Fraud and Money LaunderingRead the Press Release
A former Grosse Pointe attorney was sentenced to prison for bank fraud and money laundering, U.S. Attorney Barbara L. McQuade announced today.
McQuade was joined in the announcement by Paul M. Abbate, Special Agent in Charge of the FBI Detroit Field Office.
Kenneth Flaska was sentenced to 64 months in prison by U.S. District Judge Paul Borman in a case involving a loss to victims in the amount of $2,756,786.63.
Flaska pleaded guilty to one count of bank fraud and one count of money laundering in April 2014. According to court records, over several years Flaska executed a scheme to defraud his clients and the law firm at which he was employed. Flaska used false and fraudulent pretenses and representations to obtain funds payable to his clients, which Flaska then diverted for his own personal use. Flaska used the fraudulently obtained proceeds to purchase items such as a 31-foot yacht, which Flaska then sailed in the July 2013 Detroit to Mackinac race.
"Attorneys are paid to serve their clients, not to enrich themselves," McQuade said. "The defendant in this case went beyond committing criminal conduct by breaching professional duties to clients and colleagues."
“Over several years, and under the false pretenses of offering professional legal services, Mr. Flaska defrauded his clients and employer of over $2.75 million, living an extravagant lifestyle at their expense,” stated Paul M. Abbate, Special Agent in Charge of the FBI Detroit Field Office. “Today’s sentencing demonstrates the FBI’s resolve in bringing to justice those who steal from others to further their own selfish purposes.”
The investigation of this case was conducted by special agents of the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorneys Cynthia Oberg and Gjon Juncaj.
Former Company Controller Sentenced to 33 Months in Prison for Stealing More Than $600,000 from His EmployerRead the Press Release
CHARLOTTE, N.C. – Darren White, 49, of Mooresville, N.C. was sentenced on Tuesday, September 2, 2014, to serve 33 months in prison for stealing more than $600,000 from his former employer, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina. Chief U.S. District Judge Frank D. Whitney also imposed a $10,000 fine and two years of supervised release after White’s incarceration.
U.S. Attorney Tompkins is joined in making today’s announcement by John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division and Chief Rodney D. Monroe of the Charlotte-Mecklenburg Police Department (CMPD).
According to filed court documents and court proceedings, from 2008 to 2011, White was employed by an international labeling solutions company (the “company”) with offices in Charlotte, as the company’s controller and director of financial planning and analysis. In that capacity, White managed the company’s credit card program, which included overseeing his employer’s credit card accounts and related financial statements. Court records indicate that White was the only employee with administrative access to the accounting records related to the company’s credit card program.
According to documents filed in the case, over the course of his employment, White exploited his position and used the company’s corporate credit card to pay for more than $600,000 in personal expenditures. Court filings reflect that White used the company’s credit card to buy personal items such as firearms, diving equipment, clothing, and household goods and electronics, and to pay for personal expenditures including travel expenses and entertainment. As described in further court documents, White created a series of fraudulent accounting entries in the company’s books and records to conceal his scheme. Court records indicate that when White was initially confronted by his employer about the credit card transactions, White characterized them as legitimate business expenses authorized by the company’s management. White pleaded guilty in January 2014 to one count of wire fraud.
In handing down White’s sentence, Judge Whitney noted that White’s multi-year criminal scheme caused great harm to the victim company. Judge Whitney also stressed that general deterrence was an important factor in reaching his decision to imprison White for 33 months.
White will remain free on bond and will be ordered to report to the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
The investigation was handled by the FBI and CMPD. The prosecution for the government is being handled by Assistant United States Attorneys Mark T. Odulio and Benjamin Bain-Creed of the U.S. Attorney’s Office in Charlotte.
Former Bank Officer Sentenced to 30 Months in Federal PrisonRead the Press Release
In Waco today, 34-year-old Cory Cole of Itasca, TX, was sentenced to 30 months in federal prison for embezzling money from the Citizens State Bank (CSB) announced United States Attorney Robert Pitman.
In addition to the prison term, United States District Judge Walter S. Smith, Jr. ordered that Cole pay a $50,000 fine and be placed under supervised release for a period of five years after completing his prison term. Yesterday, Cole paid $175,000 restitution to the bank.
On July 3, 2014, Cole pleaded guilty to one count of theft or embezzlement by a bank employee. By pleading guilty, Cole admitted that beginning in January 2013, while serving as a CSB vice president, he stole bank funds by approving more than 20 loans based on fraudulent documentation he created.
Cole remains on bond pending notification of Bureau of Prisons facility designation.
This case was investigated by the U.S. Secret Service and the Texas Department of Public Safety. Assistant United States Attorney Gregg Gloff prosecuted this case on behalf of the Government.
Florida Man Sentenced to 63 Months in Prison for Stealing More Than $3 Million from InvestorsRead the Press Release
United States Attorney Andrew M. Luger today announced the sentencing of GARY RICHARD VIBBARD, 58, formerly of Ocala, Florida, to 63 months in federal prison for stealing more than $3,000,000 from dozens of investors and investment fund managers. Rather than paying investors based on corporate profits as promised, the defendant operated a Ponzi-like scheme, repaying earlier investors with investment funds provided by later investors. VIBBARD pleaded guilty on May 15, 2014, in U.S. District Court in St. Paul, to mail fraud.
“Mr. Vibbard tricked investors into believing they were making an informed and sound investment,” said U.S. Attorney Luger. “By lying about his past and disguising his operation as legitimate, he was able to defraud his clients of millions of dollars. Investment fraud is a priority for this Office and financial predators will be brought to justice.”
According to his guilty plea and documents filed in court, VIBBARD, the owner and manager of R. Capital Advisors (RCA), operated a Ponzi-like scheme to defraud investors and investment fund managers. VIBBARD admitted that from approximately August 20, 2008 until 2010, he marketed and sold investments by lying about RCA’s financial performance and capabilities and by omitting facts about his history as a financial manager. VIBBARD told potential investors that he was a proven and talented financial manager, when in fact he had filed for bankruptcy in 2000, owed more than $1.5 million in back taxes, and lost more than $1,000,000 in investor funds through a prior failed company.
In addition to using investor funds to repay prior investors, VIBBARD used the funds entrusted to him for personal expenses including child support, gym membership, upscale clothing, and an internet dating service. VIBBARD directed his bookkeeper to drain corporate bank accounts and hide the funds in cashier’s checks, to thereby prevent creditors and the Internal Revenue Service from seizing accounts.
As part of his plea agreement, VIBBARD agreed to pay $6.9 million in restitution, which includes restitution for losses from before the period covered by the guilty plea.
Assistant U.S. Attorney Robert M. Lewis prosecuted this case.
This case was the result of an investigation conducted by the United States Postal Inspection Service and the Federal Bureau of Investigation, with assistance from the Lake County, Florida Sheriff’s Department.
Defendant Information: GARY RICHARD VIBBARD
Ocala, FL
Convicted: • Mail Fraud, 1 count
Sentenced: • 63 Months in federal prison
• 3 years supervised releaseFederal Charges Filed in Alleged Gulf Breeze Home InvasionRead the Press Release
PENSACOLA, FLORIDA – Robert F. Fraser, age 26, Teandre L. Altman, age 21, and Frank A. Rogers, age 19, all of Pensacola, were taken into federal custody based upon a criminal complaint alleging federal firearm law violations, announced United States Attorney Pamela C. Marsh, Northern District of Florida.
The criminal complaint, sworn to by a special agent of the Bureau of Alcohol, Tobacco, Firearms and Explosives, alleges that between August 26 and August 28, 2014, the three defendants were in possession of stolen firearms, and that Fraser and Altman were convicted felons in possession of the firearms.
Late this afternoon, the defendants appeared before United States Magistrate Judge Elizabeth M. Timothy, and they were all detained without bond on the charges. The defendants also face state felony charges relating to the home invasion in both Santa Rosa and Escambia counties.U.S. Attorney Marsh praised the work of the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Santa Rosa County Sheriff’s Office, the Gulf Breeze Police Department, the Pensacola Police Department, and the State Attorney’s Office, whose joint investigation led to the criminal complaint in the case.
The case is being prosecuted by Assistant U.S. Attorney David L. Goldberg.A complaint is merely an allegation that a defendant has committed a violation of federal criminal law and is not evidence of guilt. All defendants are presumed innocent and entitled to have a Grand Jury determine probable cause exists to return an Indictment. After an indictment is returned, a defendant is entitled to a fair trial, during which it will be the government’s burden to prove guilt beyond a reasonable doubt in a court of law.
El Paso Man Sentenced to Life in Federal Prison on Human Trafficking ChargesRead the Press Release
In El Paso today, 54-year-old Charles Marquez was sentenced to life in federal prison and fined $10,000 for his role in a prostitution scheme involving a minor announced United States Attorney Robert Pitman, Federal Bureau of Investigation Special Agent in Charge Douglas E. Lindquist and Homeland Security Investigations (HSI) Special Agent in Charge Dennis A. Ulrich.
On November 21, 2013, a federal jury convicted Marquez of one count each of sex trafficking of a minor; sex trafficking by force, fraud or coercion; transporting for prostitution; conspiracy to coerce or entice a minor to engage in sexually explicit activity; coercion or enticement; and, importation of an undocumented alien for immoral purpose.
Testimony during trial revealed that from August 2007 through February 2012, Marquez conspired with 41-year-old Martha Jimenez Sanchez of Juarez, Mexico, to recruit women in Mexico for their prostitution scheme by placing advertisements in a Ciudad Juarez newspaper offering jobs in the United States. Once recruited, the defendants arranged to transport the females to El Paso, harbor them in local motels and force them to commit prostitution for the financial benefit of the defendants.
“The sentencing of Marquez is an affirmation of the dedication, commitment, and hard work of the FBI, HSI, and our state and local partners to work diligently in keeping the El Paso Community safe. Collectively, we will continue to seek out, investigate and prosecute those individuals and criminal enterprises that target the underprivileged and children for Human Trafficking,” stated FBI SAC Douglas E. Lindquist, El Paso Division.“HSI is relentless in its investigations of transnational criminal organizations that exploit immigrants and children for their own financial gain,” said HSI SAC Dennis A. Ulrich, El Paso Division. “HSI will continue to work effectively with our other federal partners as well as our international counterparts to identify and dismantle human trafficking rings.”
Sanchez faces up to ten years in federal prison after pleading guilty on November 26, 2012, to one count of transportation for prostitution. Sanchez, who was released on bond after pleading guilty, is a fugitive.
This case was investigated by the FBI together with HSI as part of the nationwide Operation Cross Country which focuses on child prostitution. Assistant United States Attorney Rifian Newaz and Steve Spitzer are prosecuting this case on behalf of the government.
East Saint Louis Woman Pleads Guilty to Health Care FraudRead the Press Release
Follow @SDILNewsStephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today, that Beatrice L. Randall, 59, of East Saint Louis, Illinois, pled guilty to a one-count indictment charging that she engaged in a scheme to commit health care fraud. Sentencing has been set for December 5, 2014, in United States District Court in East St. Louis, Illinois. Randall will face up to 10 years in prison, a fine of up to $250,000, and up to 3 years of supervised release.
Randall was a customer and beneficiary of the Illinois’ Home Services Program, which is a Medicaid Waiver Program designed to allow individuals to stay in their homes instead of entering a nursing home. At her plea hearing, Randall admitted that she had submitted, together with her personal assistant, false and fraudulent claims in regard to the hours of services performed by her personal assistant. The false billing occurred between October 15, 2012 and January 31, 2013.
The investigation was conducted by the U.S. Department of Health and Human Services, Office of Inspector General and the Illinois State Police, Medicaid Fraud Control Bureau. The case is being prosecuted by Assistant United States Attorney William E. Coonan and Special Assistant United States Attorney Michael J. Hallock.
If you suspect or know of an individual or company that is not complying with healthcare laws or public aid programs, you may report this activity to the local office of the U.S. Department of Health and Human Services, Office of Inspector General, or you may call 1.800.447.8477.
Dunn Man Sentenced for Cocaine Distribution & Money LaunderingRead the Press Release
WILMINGTON - United States Attorney Thomas G. Walker announced that in federal court today Senior United States District Judge James C. Fox sentenced LARRY DONNELL TAYLOR, 40,of Dunn, North Carolina, to 240 months in prison followed by 5 years of supervised released for conspiracy to distribute and possess with intent to distribute 280 grams or more of cocaine base (crack) and 5 kilograms or more of cocaine and conspiracy to commit money laundering. TAYLOR previously pled guilty to these charges on January 2, 2013.
The investigation revealed that from at least 2000 to October 2012, TAYLOR was an upper-level drug trafficker who received large quantities of cocaine and crack cocaine from several suppliers. Upon receiving the drugs, TAYLOR utilized several individuals to distribute his drugs throughout the Eastern District of North Carolina. TAYLOR also converted substantial quantities of cocaine into crack cocaine for resale.
On October 3, 2012, investigators served a federal arrest warrant on TAYLOR at his residence in Fayetteville. Law enforcement officers immediately observed a firearm lying on the floor of TAYLOR’S home. A subsequent search of his home and/or vehicles revealed 9 kilograms of cocaine, 563 grams of crack cocaine, $551,136 in U.S. currency, digital scales, a semi-automatic rifle, and a loaded revolver. Following his arrest, TAYLOR provided an unprotected statement to authorities, wherein he acknowledged possessing the firearms and drugs.
Investigators also determined that between May 2008 and May 2011, TAYLOR used $106,994 in drug proceeds to purchase at least four vehicles, including a 2007 GMC Denali, a 2007 Mercedes 550, a 2004 Ford F-150, and a 2004 Porsche Cayenne. In order to conceal the source of the proceeds, TAYLOR recruited and directed the activities of his sister. At the direction of TAYLOR, she purchased the Mercedes and Porsche on TAYLOR’S behalf and placed the vehicles in her name. The vehicles obtained were purchased with proceeds from TAYLOR’S drug trafficking, and TAYLOR used the vehicles to transport and distribute illegal narcotics throughout the Eastern District of
North Carolina.Based upon the evidence, TAYLOR is responsible for approximately 199.845 kilograms of cocaine, 56.56 kilograms of crack cocaine, and 80 pounds of marijuana, which have a total marijuana equivalency of 241,981 kilograms. TAYLOR also possessed at least two firearms in furtherance of his drug-trafficking activities, and he maintained an aggravated role in the offense by recruiting and directing the activities of other conspirators with regard to the drug-trafficking and money laundering. Lastly, TAYLOR was in the business of laundering funds, and he is conservatively accountable for arranging four automobile transactions totaling $106,994 in drug proceeds.
The investigation of this case was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Internal Revenue Service Criminal Investigations, Harnett County Sheriff’s Office, North Carolina State Bureau of Investigation, Raleigh Police Department, Cumberland County Sheriff’s Office, and the Dunn Police Department. The federal prosecution was handled by Assistant United States Attorney Jennifer E. Wells and Assistant United States Attorney Steve West.
Diane Schmaler Jailed for Dorset Field Club EmbezzlementRead the Press Release
The Office of the United States Attorney for the District of Vermont announced that Diane Schmaler, 62, of Cossayuna, NY, was sentenced yesterday in United States District Court in Burlington to six months of imprisonment following her guilty plea to a charge of interstate transportation of stolen money. U.S. District Judge William K. Sessions III ordered that Schmaler serve three years of supervised release following completion of her prison term. As part of her supervised release term, Schmaler must spend an additional six months in home confinement. Judge Sessions stated that he will order Schmaler to pay full restitution for all the victim's losses, in an amount to be determined at a hearing next month. The court directed Schmaler to surrender to the Bureau of Prisons to begin serving her sentence on October 7.
According to the charging information and other court records, Schmaler had been employed for about 25 years by the Dorset Field Club of Dorset, VT as a bookkeeper and manager of finance and administration. Schmaler paid the club's bills, handled payroll and maintained the general ledger.
Beginning no later than 2007 and continuing until June 2013, Schmaler embezzled not less than $70,000 from the club. She did this primarily by issuing checks to herself without authorization. She also inflated payroll checks which the club issued to her and stole some of the cash receipts from special events held at the club. Schmaler attempted to conceal the embezzlement by falsifying entries in the club's general ledger. Schmaler quit her employment with the club in September 2013. At that time, an audit of the club's books was about to start. The audit uncovered the embezzlement.
The exact amount of the loss is still being determined. Schmaler has already repaid $60,000 to the club.
This case was investigated by the Federal Bureau of Investigation.
Schmaler is represented by Robert O'Neill. The prosecutor is Assistant U.S. Attorney Gregory Waples.
Detroit Drug Dealer Pleads Guilty to Federal Charges in HuntingtonRead the Press Release
HUNTINGTON, W.Va. – Ivory Hall, 32, of Detroit, Michigan, pleaded guilty today to possession with intent to distribute oxycodone and heroin, United States Attorney Booth Goodwin announced. From March 2012 through September 2012, Hall, sometimes known as “Chris Nelson,” distributed heroin in and around Huntington. On September 20, 2012, Hall was in a vehicle stopped by officers with the Huntington Police Department. At the time of the stop, Hall threw to the ground packages containing 163 30-milligram oxycodone pills, heroin packages for sale and digital scales.
Additionally, on September 20, 2012, Hall’s residence at 222 Fifth Avenue in Huntington was searched. Officers found ammunition and two firearms belonging to Hall. Hall also had $18,312 in the apartment which was used in his distribution of controlled substances.
Chief United States District Judge Robert C. Chambers scheduled Hall’s sentencing for December 1, 2014. Hall faces up to 20 years’ imprisonment and a $1 million fine at sentencing.
This case is being prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and heroin. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
Defendants Sentenced in Mail Theft CaseRead the Press Release
DALLAS — Three individuals who were involved in burglaries at two post offices in Dallas have been sentenced to lengthy federal prison sentences, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
Today, Gabriel Granado, 33, of Dallas, was sentenced by U.S. District Judge Jorge A. Solis to 96 months (eight years) in federal prison and ordered to pay $2,820 in restitution. He pleaded guilty in April 2014 to one count of burglary of a U.S. Post Office and two counts of possessing stolen mail.
Two co-defendants, Corina Denise Alfaro, 28, also of Dallas, and Esteban Segovia, 39, of San Antonio, Texas, were sentenced earlier this summer for their roles. Alfaro, who pleaded guilty to one count of burglary of a U.S. Post Office and one count of possessing stolen mail, was sentenced to 52 months in federal prison and ordered to pay $2,820 in restitution. Segovia, who pleaded guilty to one count of burglary of a U.S. Post Office, was sentenced to 26 months in federal prison.
According to plea documents filed in the case, on June 16, 2013, Granado, Alfaro and Segovia forcibly broke into a U.S. Post Office located at 2736 Royal Lane in Dallas, with the intent to commit larceny. Each further admitted they possessed checks they knew had been stolen from post offices.
According to the complaint filed in the case, on the evening of June 16, 2013, U.S. Postal Inspectors were continuing surveillance on U.S. Postal Service blue collection boxes at the Oak Lawn Station, 2825 Oak Lawn Avenue in Dallas, after several reports of break-ins at those collection boxes. The investigation of those break-ins led to the identification of Granado and Alfaro as possible suspects.
The investigation revealed, however, that late the same evening, Alfaro’s vehicle was at the Brookhollow Station, and then later, it arrived at a motel in Dallas where she and Granado were staying. Law enforcement observed them, along with Segovia, who was carrying what appeared to be two large shopping bags, exit the vehicle and enter a room at the motel.
Later that evening, while inspecting the Brookhollow Station, a U.S. Postal Inspector and a Postal Police Officer noticed that the dutch door of the lobby had been forcibly opened. In addition, an alarm had been activated from that location at the approximate time Granado and Alfaro were believed to have been at that location.
The U.S. Postal Inspection Service investigated. Special Assistant U.S. Attorney Nicole Dana prosecuted.
Defendant Who Supplied Three Rocket-Propelled Grenade Launchers Sentenced in Manhattan Federal Court to 120 Months for Attempting to Provide Material Support to A Terrorist OrganizationRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that IOANNIS VIGLAKIS, a/k/a “Pablo,” was sentenced today in Manhattan federal court to 120 months for attempting to provide material support to the Fuerzas Armadas Revolucionarias de Colombia (“FARC”), a Colombian terrorist organization. VIGLAKIS, who was arrested in Panama City, Panama, in August 2012 and subsequently turned over to the custody of the United States, pled guilty on December 10, 2013, to attempting to provide material support to the FARC, which has been designated a foreign terrorist organization by the U.S. Secretary of State. VIGLAKIS pled guilty before U.S. District Judge Katherine B. Forrest, who also imposed today’s sentence.
Manhattan U.S. Attorney Preet Bharara said: “Ioannis Viglakis attempted to sell military-grade weapons to the FARC, a terrorist organization, which has used such weapons to shoot down American aircraft in Colombia. For attempting to provide material support to a terrorist organization in this way, Viglakis has been sentenced to 120 months in prison.”
According to the Indictment, other public filings in this case, and statements made at VIGLAKIS’s guilty plea and at today’s sentencing:
Beginning in November 2011, VIGLAKIS had a series of meetings with a DEA confidential source (the “CS”) who represented himself as an associate of the FARC. During those meetings, which took place in Europe and Central America, the CS informed VIGLAKIS that he was seeking weapons for use by the FARC to attack American forces in Colombia. VIGLAKIS offered to provide the FARC with functional, bona fide, military-grade weapons – including assault rifles, rocket-propelled grenade (“RPG”) launchers and surface-to-air missiles – in exchange for cocaine and cash. During the meetings, VIGLAKIS and the CS discussed the FARC’s use of these weapons to fight the Colombian and American governments, including by shooting down American aircraft in Colombia.
Over the following months, VIGLAKIS indicated that he would provide the CS with several RPG launchers as a sample. On July 18, 2012, VIGLAKIS successfully arranged for the delivery of six live RPGs and three working RPG launchers in Europe, which were received by a DEA undercover agent.
Then, in August 2012, during meetings in Panama, VIGLAKIS gave the CS approximately 8,500 euros as a partial payment to the FARC to transport a multi-kilogram shipment of cocaine to Spain on his behalf, and further offered to provide the CS with approximately 200 hand grenades in exchange for additional kilograms of cocaine.
In addition to his prison term, VIGLAKIS, 54, a citizen of Greece, was to pay a $100 special assessment fee.
Mr. Bharara praised the outstanding work of the Special Operations Division of the DEA, as well as the DEA’s Panama Country Office, Madrid Country Office, and Copenhagen Country Office. Mr. Bharara also thanked the U.S. Department of Justice’s Office of International Affairs and National Security Division, the U.S. Department of State, and the Government of the Republic of Panama.
This case is being handled by the Office’s Terrorism and International Narcotics Unit. Assistant U.S. Attorneys Christian R. Everdell, Aimee Hector, and Michael Lockard are in charge of the prosecution.
U.S. v. Ioannis Viglakis S1 Superseding Indictment
Creator of On-line Drug Bazaar Pleads Guilty to Federal Drug, Money Laundering Charges for Distributing Narcotics Around the WorldRead the Press Release
LOS ANGELES – A Dutch national has pleaded guilty to federal drug trafficking and money laundering charges, admitting that he was one of the leaders of a conspiracy that developed and operated a secret, on-line narcotics marketplace known as the “The Farmer's Market” that sold controlled substances such as LSD, “ecstasy” and marijuana to thousands of customers around the world.
Marc Peter Willems, 45, of the Netherlands, pleaded guilty late yesterday to two federal charges – conspiracy to distribute controlled substances and conspiracy to launder money. When he is sentenced on December 10 by United States District Judge Dolly M. Gee, Willems faces a potential sentence of life in federal prison.
Willems was one of eight defendants charged in relation to The Farmer’s Market in April 2012 as the result of an investigation called Operation “Adam Bomb.” Willems is the sixth defendant to plead guilty, one defendant died after being indicted in the case, and the final defendant has agreed to plead guilty on Monday.
“Adam Bomb” was a two-year investigation led by the Drug Enforcement Administration that uncovered The Farmer’s Market, which was an international drug ring that attempted to operate in secret by using the TOR network, IP anonymizers and covert currency transactions. The encrypted TOR network allows websites and electronic mail communications to completely mask IP address information by spreading communications over a series of computers, or relays, located throughout the world. The Farmer’s Market accepted payments for illegal drug sales through Western Union, Pecunix, PayPal and I-Golder.
The eight defendants were initially charged in a 12-count indictment that described how The Farmer’s Market allowed independent narcotics dealers to anonymously advertise illegal drugs for sale. The Farmer’s Market (which had previously been known as “Adamflowers”) provided a marketplace, order forms, on-line forums, customer service, and payment methods for the different sources of supply. The operators screened all sources of supply and guaranteed delivery of the illegal drugs in exchange for a commission based upon the value of the order. Investigators identified customers in every one of the states of the United States and the District of Columbia and in approximately 45 other countries. One of the “customers” was an undercover DEA special agent based in Los Angeles.
In his plea agreement, Willems acknowledged that The Farmer’s Market processed approximately $2.5 million in orders for illegal drugs over the course of several years.
“The Illegal sale of narcotics cannot be cloaked through the use of the Internet, even when sophisticated technology is used to conceal the drug trafficking,” said Acting United States Attorney Stephanie Yonekura. “Working with our law enforcement partners domestically and around the world, we have the ability to uncover and prosecute this hidden, illegal activity.”
Anthony D. Williams, Special Agent in Charge of the DEA’s Los Angeles Field Division, said: “Today’s guilty plea demonstrates DEA’s commitment to identify, apprehend, and bring to justice all drug traffickers, including those who attempt to cloak their illegal activities utilizing the perceived anonymity of the Internet. This conviction sends a clear message that law enforcement can and will use creative investigative techniques to uncover and dismantle online drug marketplaces such as the one operated by Mr. Willems.”
Another key player in The Farmer’s Market – Michael Evron, 44, a United States citizen who was living in Buenos Aires when he was arrested in 2012 – pleaded guilty to conspiracy to distribute controlled substances and conspiracy to launder money and is scheduled to be sentenced by Judge Gee on November 19.
Four other defendants have previously pleaded guilty and are scheduled to be sentenced later this year.
The final defendant – Ryan Rawls, 33, of Alpharetta, Georgia – has agreed to plead to conspiracy to distribute controlled substances and is scheduled to formally enter his guilty plea on Monday.
Release No. 14-113
Convicted Ponzi Schemer Eliyahu Weinstein Admits New Fraud and Money Laundering ChargesRead the Press Release
Defrauded Investors in Facebook IPO and Real Estate Deals
TRENTON, N.J. – Convicted Ponzi schemer Eliyahu Weinstein, 39, of Lakewood, N.J., who was previously sentenced to 22 years in prison for running a real estate investment fraud scheme that caused $200 million in losses, today admitted that he also defrauded investors in connection with the Facebook IPO and several additional real estate deals and then laundered the proceeds of the scheme, U.S. Attorney Paul J. Fishman announced.
Weinstein pleaded guilty before U.S. District Judge Joel A. Pisano in Trenton federal court to three counts of an indictment pending against him: one count of conspiracy to commit wire fraud, one count of committing wire fraud while on pretrial release, and one count of money laundering.Two co-defendants, Alex Schleider, 48, of Lakewood, and Aaron Glucksman, 41, of Brooklyn, New York, have already pleaded guilty to charges related to their roles in the scheme. Judge Pisano sentenced Glucksman on May 5, 2014, to 52 months in prison, three years of supervised release, and ordered him to forfeit $1.2 million. Judge Pisano ordered Glucksman’s sentence to run partially concurrently with a 36-month sentence recently imposed by U.S. District Judge Raymond J. Dearie of the Eastern District of New York in an unrelated case. Glucksman remains on release pending his designation to a federal institution by the U.S. Department of Justice, Bureau of Prisons. Schleider is scheduled to be sentenced Sept. 18, 2014.
“Even while facing federal charges that eventually netted him decades in prison, Weinstein couldn’t resist the buzz around the Facebook IPO and the opportunity to fleece unsuspecting investors,” U.S. Attorney Fishman said. “Shamelessly, he even used the money he stole to pay the legal fees he accumulated from the previous scam.”
“Eliyahu Weinstein spent the greater part of a decade creating and executing a series of elaborate fraudulent investment schemes, ultimately defrauding victims of over $200 million by taking advantage of trusted relationships and innocent investors,” Aaron T. Ford, FBI Special Agent in Charge, Newark, said. “This long-term, complex investigation required much in terms of investigative resources. The FBI, through its vast experience investigating investment schemes, was able to provide such resources, resulting in the arrest and today’s guilty plea of Eliyahu Weinstein.”
According to documents filed in this case and statements made in court:
In February 2012, Weinstein and his fellow conspirators offered a pair of investors (referred to in the indictment as the “Facebook victims”) the opportunity to purchase large blocks of Facebook shares prior to the company’s initial public offering, or IPO, in May 2012. The offer was particularly attractive because large blocks of the shares were extremely difficult to get and were expected to increase in value at the time of the IPO. Weinstein and his conspirators did not actually have access to the shares.
Based on misrepresentations by Weinstein and his conspirators, the Facebook victims wired millions of dollars between February and March of 2012 to an account Weinstein and a conspirator controlled. Weinstein and another conspirator provided investors with false documents showing companies owned by various conspirators held assets, which would secure the Facebook victims’ investment.
The conspirators did not use any of the Facebook victims’ money to purchase Facebook shares, instead misappropriating it for their own use. Weinstein used some of the money to pay lawyers and experts representing him in his earlier – and at that time, still pending – criminal case and in related civil matters. Weinstein and his conspirators also used the Facebook victims’ money to make investments in businesses unrelated to Facebook and to make loans for their own benefit.
Around the same time, Weinstein and his conspirators also persuaded the Facebook victims to invest in the purported purchase of an apartment complex, “Belle Glade Gardens,” in Florida. They told the Facebook victims that Weinstein had the opportunity to purchase Belle Glade Gardens at a discounted price and immediately flip it at a substantial profit. Weinstein and his conspirators further told the Facebook victims that Weinstein had already placed $2.5 million in the trust account of a Miami law firm for the transaction; that if the Facebook victims contributed another $2.5 million toward the transaction, those funds would remain in escrow at the Miami law firm until the deal closed; and that the Facebook victims would be repaid within 60 days. The Facebook victims wired $2.83 million to the Miami law firm in order to complete the Belle Glades Gardens transaction. Weinstein and his conspirators did not use the money to purchase Belle Glades Gardens. Instead, they redirected the money from the law firm to accounts that they controlled, returned $1.8 million to the Facebook victims as a purported return on their Facebook investment, and used the remaining money for their own purposes.
In July 2012, Weinstein approached another group of investor victims (referred to in the indictment as the “Florida condominium victims”) and told them he had the opportunity to purchase the notes on seven condominiums in Florida at a discounted price of $3 million. Weinstein and his conspirators falsely represented that they had already paid $1.5 million toward the deal, and that they needed only $1.5 million to complete the transaction. They claimed that the properties had an annual rental income of approximately $780,000 and provided to the Florida condominium victims fraudulent documentation purporting to verify this fact. The victims transferred $1.5 million to Weinstein and his conspirators between August 2012 and December 2012. Weinstein did not use this money to purchase the notes on the Florida condominiums – many of which he himself had previously owned and lost to foreclosure. Instead, Weinstein and his conspirators converted the money to their own use.
Throughout the scheme, Weinstein was already under indictment and on pretrial release, and was prohibited from engaging in any monetary transaction for more than $1,000 without the approval of court-appointed special counsel. Weinstein pleaded guilty on Jan. 3, 2013, before Judge Pisano to two counts of that indictment, admitting he ran a Ponzi-style real estate investment fraud scheme that caused $200 million in losses and then laundered the proceeds of the scheme. Judge Pisano sentenced Weinstein on Feb. 25, 2014, to 264 months in prison and ordered him to pay more than $200 million in restitution and forfeiture to the victims of his scheme.
The counts to which Weinstein pleaded guilty today carry the following maximum potential penalties: 20 years in prison on the conspiracy count; 30 years in prison on the wire fraud while on pretrial release count (20 years on the wire fraud plus 10 years for commission while on pretrial release); and 10 years on the money laundering count. All the counts are also punishable by a maximum fine of the greater of $250,000 or twice the amount of Weinstein’s gain from the scheme. Sentencing is scheduled for Dec. 15, 2014.
Charges against a third conspirator, Aaron Muschel, 64, of Brooklyn, NY, who was charged in the criminal complaint filed against Weinstein and Schleider in May 2013, remain pending. The charges against him are merely accusations and he is presumed innocent until proven guilty.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Acting Special Agent in Aaron T. Ford in Newark, for the investigation leading to today’s guilty plea. He also thanked agents of IRS–Criminal Investigation, under the direction of Acting Special Agent in Charge Jonathan D. Larsen, for their role in the investigation.
The government is represented by Counsel to the U.S. Attorney Rachael A. Honig; Gurbir S. Grewal, Chief of the U.S. Attorney’s Office Economic Crimes Unit; Assistant U.S. Attorneys Zach Intrater of the Economic Crimes Unit; and Evan S. Weitz of the Asset Forfeiture and Money Laundering Unit.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorney’s offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
14-302
Defense counsel: Eric Creizman Esq., New York
Weinstein, Eliyahu Indictment
Colombian National Pleads Guilty to <br /> Kidnapping and Murder of DEA Agent Terry WatsonRead the Press Release
A Colombian man extradited to the Eastern District of Virginia pleaded guilty today for his involvement in the kidnapping and murder of Drug Enforcement Administration (DEA) Special Agent James Terry Watson in Bogotá, Colombia, on June 20, 2013.
Attorney General Eric H. Holder, Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Dana J. Boente of the Eastern District of Virginia, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office, DEA Administrator Michele M. Leonhart and Director Bill A. Miller of the State Department’s Diplomatic Security Service (DSS) made the announcement.
“Special Agent Watson gave his life in the service of his country, and we will do everything in our power to honor his sacrifice,” said Attorney General Holder. “This conviction is a critical step forward. But while this action represents the first measure of justice for his kidnapping and murder, it will not be the last. The Department of Justice will not rest until all those involved in this senseless act of violence have been held to account for their crimes. Our nation will never yield in the protection and defense of its citizens. And we will continue to demonstrate that anyone who seeks to harm an American will be found, will be prosecuted, and will be brought to justice.”
Julio Estiven Gracia Ramirez, 31, pleaded guilty before U.S. District Judge Gerald Bruce Lee of the Eastern District of Virginia to aiding and abetting the murder of an internationally protected person and conspiracy to kidnap an internationally protected person. Sentencing is scheduled for Dec. 5, 2014.
In a statement of facts filed with the plea agreement, Gracia Ramirez admitted that he and his conspirators agreed to conduct a “paseo milionario” or “millionaire’s ride” in which victims who were perceived as wealthy were lured into taxi cabs, kidnapped and then robbed. Gracia Ramirez admitted that he targeted Special Agent Watson and picked him up outside a Bogotá restaurant in his taxi. Soon after, two conspirators entered Gracia Ramirez’s taxi, and one used a stun gun to shock Special Agent Watson and the other stabbed him. Special Agent Watson was able to escape from the taxi, but he later collapsed and died from his injuries.
Six other defendants have been charged in an indictment in the Eastern District of Virginia for their alleged involvement in the murder of Special Agent Watson. Gerardo Figueroa Sepulveda, 39; Omar Fabian Valdes Gualtero, 27; Edgar Javier Bello Murillo, 27; Hector Leonardo Lopez, 34; and Andrés Alvaro Oviedo-Garcia, 22, are each charged with second degree murder, kidnapping and conspiracy to kidnap. Oviedo-Garcia is also charged with assault. Wilson Daniel Peralta-Bocachica, 31, is charged for his alleged efforts to destroy evidence associated with the murder of Special Agent Watson. Trial is set for Jan. 12, 2015.
The charges in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
This case was investigated by the FBI, DEA and DSS, in close cooperation with Colombian authorities and with assistance from INTERPOL and the Justice Department’s Office of International Affairs. The case is being prosecuted by Special Counsel Stacey Luck of the Criminal Division’s Human Rights and Special Prosecutions Section and Assistant U.S. Attorney Michael P. Ben’Ary of the U.S. Attorney’s Office for the Eastern District of Virginia.
The Department of Justice gratefully acknowledges the Colombian Attorney General’s Office, Colombian National Police, Colombian Directorate of Criminal Investigation and Interpol (DIJIN), DIJIN Special Investigative Unit, Bogotá Metropolitan Police, Bogotá Police Intelligence Body (CIPOL) Unit and Colombian Technical Investigation Team for their extraordinary efforts, support and professionalism in responding to this incident.
Cleveland Company Pleads Guilty to Making Illegal Discharges into Sewer SystemRead the Press Release
Cleveland-based Kelly Plating Company pleaded guilty to making illegal discharges with high concentrations of metals such as chrome and zinc into the sewer system, which in turn, after treatment, discharges to Lake Erie, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The company pleaded guilty today to one count of conspiracy to violate the Clean Water Act and one count of violating an approved pretreatment program.
An employee at Kelly Plating bypassed the pollution control equipment and discharged partially treated wastewater and sludge directly into the sewer system. These discharges contained high concentrations of chrome and zinc. This happened at least 14 times between March and May, 2012, according to court documents.
Under the terms of the plea agreement, both parties agree to recommend to the court that Kelly Plating pay a $50,000 fine as well as a $25,000 community service payment. The community service payment will be made to a charitable organization to be presented to the court prior to sentencing. The charitable organization will use the payment to improve water quality in Northeast Ohio, according to the plea agreement.
Sentencing is scheduled for Dec. 11.
Criminal charges remain pending against a Kelly Plating employee who was indicted earlier this year.
This case is being prosecuted by Special Assistant U.S. Attorney Brad Beeson following an investigation by the Ohio EPA, U.S. EPA, the Ohio Bureau of Criminal Investigation, and Northeast Ohio Regional Sewer District.
Cincinnati, Ohio Man Sentenced to 15 Years in Federal Prison on Drug and Firearms ChargesRead the Press Release
In Waco today, 31-year-old Rodney Davis of Cincinnati, OH, was sentenced to 15 years in federal prison followed by five years of supervised release and fined $3,000 for his role in a drug distribution operation announced United States Attorney Robert Pitman and Texas Department of Public Safety Director Steve McCraw.
On June 26, 2014, U.S. District Judge Walter S. Smith convicted Davis of possession with intent to distribute cocaine, possession of a firearm during the commission of a drug trafficking crime and possession of a firearm by a convicted felon. Testimony during the bench trial revealed that on August 6, 2013, Davis was stopped by a Texas Department of Public Safety trooper just outside of Centerville in Leon County. A search was conducted after a canine unit alerted on Davis’ vehicle. During the search, the trooper discovered approximately six kilograms of cocaine and a .40 caliber Smith and Wesson semi-automatic firearm. Davis’ criminal history includes a 2001 robbery conviction in Hamilton County, Ohio.
This case was investigated by the Texas Department of Public Safety Criminal Investigations Division. Assistant United States Attorney Mary Kucera prosecuted this case on behalf of the Government.
Cedar Rapids Man Sentenced to More Than Three Years in Prison for Robbing Bank in ElyRead the Press Release
A man who robbed the Solon State Bank in Ely, Iowa, was sentenced on September 2, 2014 to more than three years in federal prison.
Robert Melton, 51, from Cedar Rapids, Iowa, received the prison term after a May 15, 2014, guilty plea to one count of bank robbery.
At the guilty plea, Melton admitted he entered the Solon State Bank in Ely on January 17, 2014, and gave a note to a teller demanding money and informing the teller not to do anything and nothing would happen. The teller gave Melton some cash and Melton left the bank, walked to his truck, and drove away. A witness to the robbery followed Melton as he drove away from the bank. The witness called 911 and reported Melton’s location. Law enforcement officers then stopped Melton and took him into custody.
Melton was sentenced in Cedar Rapids by United States District Court Chief Judge Linda R. Reade. Melton was sentenced to forty-six months’ imprisonment. A special assessment of $100 was imposed. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system.
Melton is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Anthony Morfitt and investigated by the Federal Bureau of Investigation and the Linn County Sheriff’s Office.
Court file information is available at https://ecf.iand.uscourts.gov/. The case file number is 14-CR-00024.
Cambria County Man Sentenced to Probation with Home Detention for Conspiring to Launder Drug MoneyRead the Press Release
JOHNSTOWN, Pa. - A resident of Northern Cambria, Pa., has been sentenced in federal court to five years probation, the first 12 months of which must be served by conditions of home confinement, and 500 hours of community service on his conviction of conspiracy to commit money laundering, United States Attorney David J. Hickton announced today.
United States District Judge Kim R. Gibson imposed the sentence on Timothy S. Golby, 47.
According to information presented to the court, from March 2008 to May 9, 2011, Golby conspired to commit money laundering. In addition, evidence presented to the Court at the time of Golby's sentencing reflected that Golby conspired with George M. Lowmaster and others to conduct financial transactions involving proceeds generated through Lowmaster's drug distribution organization with the intent to conceal the source of the proceeds and with the intent to promote the carrying on of Lowmaster's drug distribution organization.
Assistant United States Attorney John J. Valkovci, Jr., prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the joint task force, headed by the Laurel Highlands Resident Agency of the Federal Bureau of Investigation, for the investigation leading to the successful prosecution of Golby. Other agencies participating on the task force include the Internal Revenue Service-Criminal Investigation, Pennsylvania State Police, Pennsylvania Attorney General's Office, Cambria County District Attorney's Office, Carrolltown Police Department, Patton Police Department, Ebensburg Police Department, Portage Police Department and Paint Township Police Department.
Bookkeeper, Patricia Blanchard, Charged with Mail Fraud for Embezzling over $700,000 from A Charitable OrganizationRead the Press Release
U.S. Attorney Kenneth Polite announced that PATRICIA BLANCHARD, age 67, formerly of New Orleans, Louisiana, was charged today in a one-count Bill of Information with mail fraud.
According to the Bill of Information, BLANCHARD’S husband was hired in 2000 to be the Executive Director and President of a not-for-profit charitable organization that raised, collected, and distributed funds to local charities through workplace giving campaigns (“Charity A”). In about 2005, he arranged for BLANCHARD to be hired as Charity A’s bookkeeper.
Between 2006 and November 2011, BLANCHARD embezzled approximately $715,000 from Charity A in three ways. First, she mailed checks drawn on Charity A’s accounts to pay her own credit card bills. To disguise her behavior and make the checks look legitimate, BLANCHARD added fictitious notes on the checks, such as “Cancer Research Institute,” “AIDS Research Foundation,” “MARCH OF DIMES,” “NO AIDS/TASK FORCE,” “American Heart Assoc.,” and “AMERICAN CANCER SOCIETY.” Second, BLANCHARD obtained cash advances on her gas card without authorization and reimbursed herself from Charity A’s accounts, making it look like the reimbursements were for legitimate travel and gas expenses. Third, BLANCHARD paid for personal expenditures and items directly from Charity A’s bank accounts without authorization.
If convicted, BLANCHARD faces a maximum term of imprisonment of 20 years in prison, 3 years of supervised release after any term of imprisonment, and a $250,000 fine.
U.S. Attorney Polite reiterated that the Bill of Information is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
This case is being investigated by agents from the Federal Bureau of Investigation. The prosecution of this case is being handled by Assistant United States Attorney Jordan Ginsberg.
(Download Bill of Information )
Bastrop Tax Preparer Sentenced to 30 Months in Prison for Filing False Tax ReturnsRead the Press Release
More than $92,000 in refunds illegally received
MONROE, La. – A Bastrop tax preparer was sentenced to 30 months in prison and one year of supervised release for filing income tax returns containing false information, U.S. Attorney Stephanie A. Finley announced today.
Camille Cooper, 40, of Bastrop, La., was also ordered by U.S. District Judge Robert G. James to pay $92,530 in restitution to the IRS for one count of aiding and assisting in making and subscribing a false return. According to evidence presented at the May 28, 2014 guilty plea, Cooper was a tax preparer at Faster Tax Refund Express in Bastrop from December 2010 to April 2011. She filed 17 fraudulent 1040 forms. Sixteen returns contained a falsified Schedule F (profit and loss from farming) and a falsified Form 4136 (federal tax credit for tax paid on fuels). Five contained a falsified Schedule C (profit and loss from business). Because of the fraudulent forms, the IRS issued $92,530 to customers to which they were not entitled. Also as part of the scheme, the defendant received approximately $2,275 in kickbacks from customers. These payments were in addition to the fees the company charged
The IRS conducted the investigation. Assistant U.S. Attorney Seth D. Reeg prosecuted the case.Auburn Man Pleads Guilty to Cocaine Trafficking ConspiracyRead the Press Release
Contact: Daniel J. Perry
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced that David
Goyette, 27, of Auburn, Maine, pleaded guilty last Friday in U.S. District Court in Portland to conspiracy to distribute 500 grams or more of cocaine and 28 grams or more of crack cocaine.According to court records, from 2011 through June 2013, Goyette obtained kilogram quantities of cocaine from Massachusetts, cooked some of it into crack cocaine and distributed both substances in the greater Lewiston/Auburn area. On June 3, 2013, Goyette telephonically made plans to meet his supplier the next day in Boston. The next day, law enforcement agents followed Goyette as he drove from Auburn to Boston. In Boston, law enforcement agents watched as Goyette and his supplier met and then left in separate vehicles. Shortly thereafter, both vehicles were stopped and agents recovered about $25,000 in the supplier’s vehicle. On
June 4, 2013, search warrants were executed at Goyette’s and his mother’s residences. In a closet outside the mother’s apartment, agents recovered about 500 grams of cocaine and a digital scale. Inside Goyette’s apartment, agents recovered expensive jewelry.The defendant faces between five and 40 years in prison and a $5,000,000 fine. He will be sentenced after the completion of a presentence investigation report by the U.S. Probation
Office.The joint investigation was conducted by the U.S. Drug Enforcement Administration, the
Maine Drug Enforcement Agency and the Auburn Police Department, and the ongoing effort of the Organized Crime Drug Enforcement Task Forces (OCDETF), a partnership between federal, state and local law enforcement agencies. 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.Attorney General Holder Statement on the Planned Departure of Associate Attorney General Tony WestRead the Press Release
Attorney General Eric Holder released the following statement Wednesday on the departure, effective September 15, of Associate Attorney General Tony West:
“Since returning to the Justice Department in 2009, Tony West has been an indispensable member of the Department’s senior leadership team, an exemplary and dedicated public servant, and a close advisor and good friend. His tenure as Assistant Attorney General for the Civil Division was defined by historic steps forward, including the Administration’s decision not to defend the constitutionality of Section 3 of the Defense of Marriage Act. His service as Associate Attorney General has been marked by significant achievement – from his leadership in securing the landmark reauthorization of the Violence Against Women Act; to his passionate advocacy for the rights of American Indian and Alaska Native peoples; to his tireless work to combat financial fraud, hold corporations accountable, and fight for American consumers.
“Over the years, Tony’s efforts have made a tremendous and lasting difference in the lives of millions of people across the country. I have been honored to count him as a colleague – and privileged to work alongside him. I thank him for his service, and his friendship, over the past five years. And although I wish him the best as he opens an exciting new chapter in his career, I will miss his leadership, his many contributions, and his steadfast commitment to the cause of justice.”
Attorney General Holder Statement on Jenny Durkan Stepping Down as U.S. Attorney for Western District of WashingtonRead the Press Release
Attorney General Eric Holder released the following statement Wednesday on the resignation of U.S. Attorney Jenny Durkan for the Western District of Washington:
"As United States Attorney for Western Washington, Jenny has served as a tireless advocate for the American people, for the citizens of Washington state, and for the cause of justice.
“Over the years, she has demonstrated remarkable skill in guiding complex litigation, fostering interagency coordination, and combating a wide range of criminal activities. Jenny has been an exceptional leader in the Justice Department’s fight against cyber-crime and our work to protect the civil rights of all Americans. And with a strong focus on education, prevention, treatment, and community outreach, she launched one of the first federal drug courts.
“Jenny Durkan exemplifies the highest standards of personal integrity and professional excellence. For the past five years, I have been grateful for Jenny’s dedicated service and her wise counsel. I am certain that the people of Western Washington will continue to benefit from her service for years to come. And although I wish her the very best as she takes the next step in her career, I will miss her leadership, her contributions, and her friendship.”
Attorney General Holder Statement on Jenny Durkan Stepping Down as U.S. Attorney for Western District of WashingtonRead the Press Release
WASHINGTON—Attorney General Eric Holder released the following statement Wednesday on the resignation of U.S. Attorney Jenny Durkan for the Western District of Washington:
"As United States Attorney for Western Washington, Jenny has served as a tireless advocate for the American people, for the citizens of Washington state, and for the cause of justice.
“Over the years, she has demonstrated remarkable skill in guiding complex litigation, fostering interagency coordination, and combating a wide range of criminal activities. Jenny has been an exceptional leader in the Justice Department’s fight against cyber-crime and our work to protect the civil rights of all Americans. And with a strong focus on education, prevention, treatment, and community outreach, she launched one of the first federal drug courts.
“Jenny Durkan exemplifies the highest standards of personal integrity and professional excellence. For the past five years, I have been grateful for Jenny’s dedicated service and her wise counsel. I am certain that the people of Western Washington will continue to benefit from her service for years to come. And although I wish her the very best as she takes the next step in her career, I will miss her leadership, her contributions, and her friendship.”
35 Year Prison Sentence for Nationwide Foreclosure Rescue ScamRead the Press Release
SACRAMENTO, Calif. — Charles Head, 40, of Pittsburgh, Pennsylvania, (formerly of Los Angeles and Orange County), was sentenced today by United States District Judge Kimberly J. Mueller to 35 years in prison, United States Attorney Benjamin Wagner announced. A hearing to determine the amount of restitution has been set for November 22, 2014.
In sentencing, Judge Mueller noted that Charles Head had “created and implemented a very cynical scheme” and that Head’s life has “shown an inability to respect the law.”
In 2013, Head was convicted in two jury trials of two conspiracies to commit mail fraud in connection with nationwide “foreclosure rescue” scams. He was also convicted of seven counts of mail fraud. According to evidence presented at trial and at his sentencing hearing, Head was the CEO of a group of brokerage and financial companies in Orange County and Los Angeles County: Head Financial Services, Creative Loans, and others.
In 2008, a federal grand jury indicted Head and 16 other defendants in two cases, charging them with conspiracy to commit mail fraud, mail fraud, and other charges related to the Head Financial Services equity skimming schemes. The evidence at trial established that the defendants solicited homeowners facing foreclosure, promising to help the homeowners avoid foreclosure and repair their credit. Instead, through misrepresentations, fraud, and forgery, the defendants led the victims to complete transactions that substituted straw buyers for the victim homeowners on the titles of properties without the homeowners’ knowledge. These straw buyers were often friends and family members of the defendants, or were solicited on the Internet. Once the straw buyers were on title to the homes, the defendants applied for mortgages to extract the maximum available equity from the homes. The defendants then shared the proceeds of the ill-gotten equity and the “rent” that the victim homeowners paid them. Ultimately, the victim homeowners were left with no home, no equity, and with damaged credit ratings.
Initially, Head focused his scam on distressed homeowners in California before expanding throughout the United States. In the course of the schemes, between January 2004 and June 2006, the defendants obtained over $90 million in fraudulent loans, caused estimated losses of over $50 million, and stole title to over 300 homes.
Head and his brother Jeremy Michael Head, 34, of Huntington Beach, were convicted in May 2013 following a nearly four-week trial. A second trial was held in December 2013 that lasted five weeks. Head and two other defendants were convicted.
U.S. Attorney Wagner said: "This defendant purposely targeted the financially vulnerable during their time of greatest distress with promises of help. Then he tricked them into handing over their most valuable asset, their home. When victims in one scheme grew scarce, he opened up a new scheme drawing in victims from across the country. Few economic crimes are more reprehensible. No sentence will undo the damage wrought by Charles Head and his fellow scammers, but today’s sentence brings a measure of justice for their victims.”
“In large fraud schemes like the one devised by Charles Head, we can’t forget about the individual homeowners who comprised the more than $50 million in losses,” said Monica Miller, Special Agent in Charge of the Sacramento division of the FBI. “Today’s sentencing ends an investigation that has been ongoing for more than 10 years and brings some closure to the innocent people who were victimized by Head’s callous scheme.”
“The defendant preyed on struggling and trusting homeowners, literally stealing the American Dream out from under them, with no remorse,” said José M. Martínez, Special Agent in Charge, IRS-Criminal Investigation. “Today’s sentencing signifies the continued effort by the IRS, FBI and U.S. Attorney’s Office to investigate and prosecute those who commit mortgage fraud. IRS-CI is committed to pursuing those who line their pockets with profits from these schemes.”
This case is the product of an investigation by the Internal Revenue Service‑Criminal Investigation and the Federal Bureau of Investigation. Assistant United States Attorneys Michael D. Anderson and Matthew Morris are prosecuting the case.
Sixteen other defendants have also been convicted in the two related cases and are awaiting sentencing:
Elham Assadi, aka Elham Assadi Jouzani, aka Ely Assadi, 34, of Irvine, California; Leonard Bernot, 54, of Laguna Hills, California; Akemi Bottari, 32, of Los Angeles, California; Keith Brotemarkle, 46, of Johnstown, Pennsylvania; Benjamin Budoff, 47, Colorado Springs, Colorado; Joshua Coffman, 34, of North Hollywood, California; John Corcoran, aka Jack Corcoran, 56, of Anaheim, California; Jeremy Michael Head, 34, Huntington Beach, California; Sarah Mattson, 31, of Phoenix, Arizona; Domonic McCarns, 40, of Irvine, California; Omar Sandoval, 36, of Rancho Cucamonga, California; Xochitl Sandoval, 33, of Rancho Cucamonga, California; Lisa Vang, 28, of Westminster, California; Andrew Vu, 43, of Santa Ana, California; Justin Wiley, 32, of Irvine, California, and
Kou Yang, 36, of Corona, California.In addition, defendant Ahn Nguyen is pending trial and defendant Domonic McCarns is awaiting a second trial on additional charges related to these offenses. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
This case was part of the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. For more information on the task force, please visit www.StopFraud.gov.
2 September 2014
Wilmington Man Pleads Guilty in Child Pornography CaseRead the Press Release
RALEIGH – United States Attorney Thomas G. Walker announced that in federal court today TODD BALO, 48,pled guilty before Chief United States District Judge James C. Dever, III, to receipt of child pornography, in violation of Title 18, United States Code, Section 2252(a)(2).
On November 23, 2013, a Federal Grand Jury returned a Criminal Indictment charging BALO.
According to the investigation, in November, 2012, law enforcement received a tip regarding an IP address in the Wilmington area receiving child pornography via the peer-to-peer network, Gigatribe. As the investigation progressed, the address and user were identified as BALO. BALO was interviewed and admitted that over the past seven years, he had used Gigatribe to share files with others, to include child pornography that included “very young” children. Law enforcement located and seized 14 computer hard drives, a laptop computer, a thumbdrive, and several cell phones. Forensic analysis found in excess of 7,000 images and 260 videos of child pornography.
At sentencing, scheduled for December 1, 2014, BALO faces up to 20 years imprisonment. If BALO has prior convictions relating to aggravated sexual abuse, sexual abuse, abusive sexual conduct involving a minor or ward, sex trafficking of children, or the production, possession, receipt, sale, distribution, shipment or transportation of child pornography, the penalty increases to up to 40 years imprisonment.
The criminal investigation of this case was conducted by the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. Assistant United States Attorney Ethan A. Ontjes is handling the prosecution on behalf of the Eastern District of North Carolina.
This case was part of the Project Safe Childhood initiative, a national program aimed at ensuring that criminals exploiting children are effectively prosecuted by making full use of all available law enforcement resources at every level. For more information about this important national project, Project Safe Childhood, go to www.projectsafechildhood.gov.
Waste Disposer Gets Jail Term for Dumping Toxic Mix of Chemicals in Public LandfillRead the Press Release
SAN DIEGO – Raul Antonio Gonzalez Lopez was sentenced to seven months in custody by United States District Court Judge Michael M. Anello, for illegally disposing of trash containing a potentially fatal brew of acids and potassium cyanide.
In pleading guilty, Gonzalez Lopez admitted that on March 12, 2011, he picked up trash at We Lend More, a business located in National City, California. As he was aware, this trash included containers of acid and potassium cyanide. The following day, Gonzalez Lopez dumped the chemicals (which included federally regulated hazardous wastes such as nitric acid and potassium cyanide) in the Miramar Landfill. Due to the dangerous nature of these chemicals, they are prohibited from being disposed at the Miramar Landfill.
According to Joe Lowry, Chief Scientist for the U.S. Environmental Protection Agency, when potassium cyanide and acids are combined they produce a deadly hydrogen cyanide gas. One breath of pure hydrogen cyanide gas would be enough to kill a person, and 50 ppm of hydrogen cyanide is the level that has been determined to be immediately dangerous to life or health. Lowry viewed the evidence from the case and prepared a dispersion model showing the threat area where the concentration of hydrogen cyanide is greater than or equal to 50 ppm, assuming a wind of 3 mph. This zone extends approximately 71 yards from the initial point of combination, and anyone within 30 yards when the chemicals combined would have been killed instantly.
Emphasizing the government’s commitment to enforcing environmental statutes, U.S. Attorney Laura Duffy stated that “we will continue to work with our federal law enforcement partners to take firm and decisive action when slipshod, cavalier practices pose a threat to human health.”
“Hazardous wastes pose a great risk to human health and the environment when intentionally mismanaged,” said Jay M. Green, Special Agent-in-Charge of EPA’s criminal enforcement program in California. “The defendant’s illegal disposal of dangerous acids and cyanides could have easily resulted in a serious injury or death had it not been for the vigilance of the Miramar Landfill operators. Today’s sentence demonstrates the government’s commitment to hold accountable those individuals who would attempt to profit by illegally dumping hazardous wastes.” San Diego FBI Acting Special Agent-In-Charge W Robert Howe added that this case “demonstrates the dedication of the FBI to the apprehension of those persons who jeopardize the health and lives of innocents through the deliberate mishandling and improper disposal of deadly chemicals.”
In February of 2011, We Lend More and its owner, Marc Vogel, were convicted by a jury of aiding and abetting the illegal transportation and disposal of hazardous waste. The trial evidence indicated that the acid (in a breakable glass bottle) and cyanide (in aged plastic containers) were disposed of together in the same cardboard box, which was dumped at the landfill. Because the landfill operators use heavy equipment on a regular basis to compact the face of the landfill, such activity would be expected to cause the containers to break and the chemicals (in the same box) to combine, causing instant death to the landfill operator and anyone else within 30 yards (such as other landfill personnel or customers).
Gonzalez Lopez was arrested on January 14, 2014, in Mexico and extradited to the United States to face these charges.
DEFENDANT Case Number: 11cr3327-MMA Raul Antonio Gonzalez Lopez Age: 55 Tijuana, Mexico CHARGESUnlawful Disposal of Hazardous Waste– Title 42, U.S.C., Section 6928(d)
INVESTIGATING AGENCY
Maximum penalty: 5 years’ imprisonment and $250,000 fineEnvironmental Protection Agency, Federal Bureau of Investigation
*Indictments and complaints are not evidence that the defendant committed the crime charged. All defendants are presumed innocent until the United States meets its burden in court of proving guilt beyond a reasonable doubt.
Washington Man Pleads Guilty to Telemarketing Fraud Scam Targeting Elderly CitizensRead the Press Release
SACRAMENTO, Calif. —Joseph Nkunzi, 31, of Des Moines, Washington, pleaded guilty today to conspiracy to commit mail fraud in connection with a telemarketing scam that tricked people into sending him money in order to receive cash prizes, United States Attorney Benjamin B. Wagner announced.
According to court documents, beginning in 2011, Nkunzi worked with others to defraud senior citizens of thousands of dollars in a telemarketing scheme. The FBI received a referral from the Woodland Police Department in April 2013, regarding a 78-year-old victim of the scam. She had been called by “North American Prize Pool” and told that she had won $8.8 million, but in order to receive the prize, she had to send $182,000 to various accounts to pay for taxes and fees.
During the course of the scheme, the victims would either mail checks to Nkunzi or would directly deposit checks into bank accounts that he established and controlled. Nkunzi subsequently withdrew the money or transferred it to other accounts. When federal agents searched Nkunzi’s home in Washington, they seized a Maserati and a Lexus. The scam targeted victims throughout California, including residents of Woodland, Stockton, Bakersfield, and Dinuba. In total, the victims lost approximately $850,000 to the scam.
This case is the product of an investigation by the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation. Assistant United States Attorney Michele Beckwith is prosecuting the case.
Nkunzi is scheduled to be sentenced by United States District Judge Kimberly J. Mueller on November 19, 2014. The plea agreement contemplates a sentence of four years and three months in prison. The actual sentence, however, will be determined at the discretion of the court at the sentencing hearing.
Vienna Man Sentenced to Five Years in Federal Prison for Possession of Heroin and A FirearmRead the Press Release
CHARLESTON, W.Va. – A Vienna, West Virginia man who possessed heroin and a pistol in November of 2013 was sentenced today to five years in federal prison, United States Attorney Booth Goodwin announced. Robert Lamar Bates-Porter, 27, previously pleaded guilty in May of 2014 to possession of a firearm in furtherance of a drug trafficking offense.
In August, October, and November of 2013, drug task force officers made controlled purchases of heroin from Bates-Porter. On November 10, 2013 police executed a search warrant at Bates-Porter’s 29th Street residence in Vienna, where they recovered approximately 100 grams of heroin and a Kimber .45 caliber semiautomatic pistol.
Bates-Porter had been previously convicted of felonies in Detroit, Michigan, including possession with intent to distribute cocaine in 2006 and possession of a firearm by a convicted felon in 2007. These convictions preclude him from possessing any firearm.
The Parkersburg Narcotics and Violent Crimes Task Force conducted the investigation. Assistant United States Attorney Joshua Hanks handled the prosecution. The sentence was imposed by United States District Judge John T. Copenhaver, Jr.
This case is being prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers in communities across the Southern District. This case was also brought as part of Project Safe Neighborhoods. Project Safe Neighborhoods is a nationwide commitment to reduce gun crime in the United States by working with existing local programs that target gun crime.
United States Attorney’s Office Announces Federal Violent Crime MeetingRead the Press Release
Attorney General’s Advisory Committee to discuss anti-crime strategies with state and local law enforcement officials in Indianapolis
INDIANAPOLIS– Acting United States Attorney Josh J. Minkler, today announced details of the Attorney General’s Advisory Committee (AGAC) meeting on violent and organized crime which is being held in Indianapolis, September 3-5, 2014. The AGAC gives United States Attorneys from around the country a voice in Department of Justice policies and provides advice to the Attorney General of the United States on new programs that improve the criminal justice system and the delivery of legal services at all levels.
Acting United States Attorney for the Southern District of Indiana Josh Minkler said, “We welcome the collective wisdom of United States Attorneys from around the country to share their knowledge and strategies on how better to make our communities safe."
On Friday, September 5, 2014, several presentations will be made to police executives from the entire state of Indiana in the Indianapolis Federal Courthouse. Topics include presentations by United States Attorney’s from Detroit, Philadelphia, Illinois, New York and New Jersey on gun and other violent crime initiatives. The first two days of presentations will be restricted to AGAC members.
At the conclusion of the training, Acting U.S. Attorney Minkler, and the Chairman of the AGAC Violent and Organized Crime Subcommittee, Stephen R. Wigginton, U.S. Attorney from the Southern District of Illinois, and ranking members of the committee will be available to the media for a follow-up discussion. That press conference will be held:
FRIDAY, SEPTEMBER 5, 12 NOON, IN THE US ATTORNEY’S OFFICE, 10 W MARKET STREET SUITE, 2000
United States Attorney Confirms Federal Investigation into the Death of Victor White IIIRead the Press Release
LAFAYETTE, La. – Stephanie Finley, the United States Attorney for the Western District of Louisiana, confirmed today that a federal investigation is ongoing into the death of 23-year-old Victor White III, who died in March while in the custody of the Iberia Parish Sheriff’s Office. The coroner subsequently determined that Mr. White’s death was a suicide, but Mr. White’s family has disputed that conclusion. The United States Attorney’s Office, the FBI, and the Criminal Section of the Department of Justice’s Civil Rights Division are responsible for investigating allegations of civil rights violations by officials acting under color of law, and for determining whether the evidence demonstrates that a civil rights violation occurred and that it was willful. U.S. Attorney Finley stated that a federal representative has reached out to the White family to assure them that the Department of Justice will follow where the evidence leads and will take appropriate action based on that evidence.
“This tragic incident deserves a full review of the evidence; our objective is to discover the truth,” Ms. Finley stated. “The FBI has been working parallel with the current investigation. Our review will take time to complete. FBI agents, along with attorneys from my office and the Justice Department’s Civil Rights Division, will carefully review the results of the current investigation by the Louisiana State Police, will determine what additional investigation, if any, is necessary to determine who fired the fatal shot, and whether the evidence demonstrates a willful civil rights violation. The federal investigation will supplement, rather than supplant, the investigation by state authorities. Once the investigation is complete, we will carefully review the results to decide if any prosecutable violations of federal criminal civil rights statutes occurred.”
Union Negotiator Indicted on Fraud ChargesRead the Press Release
BUFFALO, N.Y. - U.S. Attorney William J. Hochul, Jr. announced today that a federal grand jury has returned an 80 count indictment charging Frank Aquila, 76, of Amherst, N.Y., with engaging in a scheme to defraud the Buffalo Educational Support Team (BEST), a union representing approximately 900 teacher’s aides and assistants in the City of Buffalo School District. The defendant was arraigned before Magistrate Judge Hugh B. Scott and was released on his own recognizance.
The defendant is charged with 80 counts of mail fraud. Each charge carries a maximum sentence of 20 years in prison, a fine of $250,000 or both.
Assistant U.S. Attorney Russell T. Ippolito, Jr., who is handling the case, stated that according to the indictment, between March 2006 and December 2011, the defendant served as the chief negotiator for BEST during 2008 collective bargaining negotiations with the City of Buffalo School District. Aquila, as chief negotiator for BEST, refused to reach final agreement with the district on a collective bargaining agreement until and unless the district agreed to allow BEST to (1) select its own insurance broker; (2) make commission payments totaling $135,000 per year for four years to an insurance broker selected by BEST; and (3) agreed to make four payments to BEST of $65,000 each for costs and expenses associated with administering health insurance benefits for its members.
The defendant failed to disclose to the district or BEST that he would share in commissions paid to the insurance broker selected by BEST, and in payments made to BEST to administer health insurance benefits for its members. According to the indictment, Aquila unlawfully obtained $332,500.Aquila was arraigned this afternoon before U.S. Magistrate Judge Hugh B. Scott and was released on Bond.
The indictment is the culmination of an investigation by the Federal Bureau of Investigation and the U.S. Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, under the direction of Special Agent-in-Charge Cheryl Garcia of the New York Regional Office.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.Two More Laguna Pueblo Members Plead Guilty to Charges Arising out of Drive-By Shooting of Acoma Pueblo HomeRead the Press Release
ALBUQUERQUE – Two more members of Laguna Pueblo have entered guilty pleas to crimes arising out of the drive-by shooting of an Acoma Pueblo home in Dec. 2012.
Cameron Joseph Kasero, 21, pleaded guilty today to an assault with a dangerous weapon charge. Under the terms of his plea agreement, Kasero will be sentenced to 96 months in prison followed by a term of supervised release to be determined by the court. His sentencing hearing has yet to be scheduled.
Andrea Carrillo, 22, also entered a guilty plea today. Carrillo pleaded guilty to aiding and abetting an assault with a dangerous weapon. At sentencing, which has yet to be scheduled, she faces a statutory maximum sentence of ten years in prison followed by a term of supervised release to be determined by the court.
Kasero and Carrillo were two of four Laguna Pueblo members charged with assault and firearms offenses arising out of a drive-by shooting at an Acoma Pueblo home. They and their two co-defendants, Preston Chino, 21, and Joseph Edward Lucero, 24, were indicted in July 2013, for assaulting two men and a woman on Dec. 9, 2012, by discharging firearms at a residence located in Acoma Pueblo in Cibola County, N.M.
During his plea hearing, Kasero admitted assaulting the victims discharging a shotgun at a residence while it was occupied by the victims. During her plea hearing, Carrillo admitted aiding the assault on the victims by providing her co-defendants with directions to the residence with the understanding that her co-defendants intended to commit an assault at that location.
Co-defendant Chino entered a guilty plea on Aug. 27, 2014, to a federal assault charge, and admitted aiding Kasero and Lucero in assaulting the three victims by providing shotguns and ammunition to them. He also admitted driving his co-defendants to the victims’ Acoma Pueblo home where they discharged the shotguns multiple times in the direction of the residence. Under the terms of his plea agreement, Chino will be sentenced to 96 months in prison followed by a term of supervised release to be determined by the court. Chino is in federal custody and will remain detained pending his sentencing hearing, which has yet to be scheduled.
Co-defendant Lucero has entered a not guilty plea to the charges in the indictment. Charges in indictments are merely accusations and defendants are presumed innocent unless found guilty beyond a reasonable doubt in a court of law.
This case was investigated by the Albuquerque office of the FBI, the Laguna Agency of the BIA’s Office of Justice Services, the Acoma Pueblo Tribal Police and the Pueblo of Laguna Tribal Police Department. Assistant U.S. Attorney Kyle T. Nayback is prosecuting the case.
Two More Laguna Pueblo Members Plead Guilty to Charges Arising out of Drive-By Shooting of Acoma Pueblo HomeRead the Press Release
ALBUQUERQUE – Two more members of Laguna Pueblo have entered guilty pleas to crimes arising out of the drive-by shooting of an Acoma Pueblo home in Dec. 2012.
Cameron Joseph Kasero, 21, pleaded guilty today to an assault with a dangerous weapon charge. Under the terms of his plea agreement, Kasero will be sentenced to 96 months in prison followed by a term of supervised release to be determined by the court. His sentencing hearing has yet to be scheduled.
Andrea Carrillo, 22, also entered a guilty plea today. Carrillo pleaded guilty to aiding and abetting an assault with a dangerous weapon. At sentencing, which has yet to be scheduled, she faces a statutory maximum sentence of ten years in prison followed by a term of supervised release to be determined by the court.
Kasero and Carrillo were two of four Laguna Pueblo members charged with assault and firearms offenses arising out of a drive-by shooting at an Acoma Pueblo home. They and their two co-defendants, Preston Chino, 21, and Joseph Edward Lucero, 24, were indicted in July 2013, for assaulting two men and a woman on Dec. 9, 2012, by discharging firearms at a residence located in Acoma Pueblo in Cibola County, N.M.
During his plea hearing, Kasero admitted assaulting the victims discharging a shotgun at a residence while it was occupied by the victims. During her plea hearing, Carrillo admitted aiding the assault on the victims by providing her co-defendants with directions to the residence with the understanding that her co-defendants intended to commit an assault at that location.
Co-defendant Chino entered a guilty plea on Aug. 27, 2014, to a federal assault charge, and admitted aiding Kasero and Lucero in assaulting the three victims by providing shotguns and ammunition to them. He also admitted driving his co-defendants to the victims’ Acoma Pueblo home where they discharged the shotguns multiple times in the direction of the residence. Under the terms of his plea agreement, Chino will be sentenced to 96 months in prison followed by a term of supervised release to be determined by the court. Chino is in federal custody and will remain detained pending his sentencing hearing, which has yet to be scheduled.
Co-defendant Lucero has entered a not guilty plea to the charges in the indictment. Charges in indictments are merely accusations and defendants are presumed innocent unless found guilty beyond a reasonable doubt in a court of law.
This case was investigated by the Albuquerque office of the FBI, the Laguna Agency of the BIA’s Office of Justice Services, the Acoma Pueblo Tribal Police and the Pueblo of Laguna Tribal Police Department. Assistant U.S. Attorney Kyle T. Nayback is prosecuting the case.
Two Defendants Sentenced for Identity Theft and Conspiracy as part of Scheme to File False Income Tax ReturnsRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that Jameane Bolton-Williams, 39, and Joe Murl Douglas, Jr., 54, both of California, have been sentenced in federal court by U.S. District Court Judge Timothy M. Burgess, as the result of their respective roles in a scheme to steal identities and file false tax returns. Bolton-Williams will serve 82 months in prison and pay restitution of at least $91,927.65, and Douglas will serve 57 months and pay restitution in the amount of $43,043.55.
Bolton-Williams and Douglas conspired with two others to obtain identity information, such as names, dates of birth, and social security numbers, which were then used to prepare false IRS Forms W-2 that contained fabricated wage and withholding amounts. The co-conspirators then took the identity information and falsified documents to tax return preparation services in Anchorage, Eagle River, and Palmer, Alaska, as well as in Los Angeles and Orange Counties, California, to have tax returns prepared and electronically submitted to the IRS.
The false returns requested refunds totaling between $1,400 and $8,600 each. In many cases, the defendants applied for refund anticipation loans and had the fraudulently obtained tax refunds loaded onto reloadable stored value cards allowing them instant access to the money even if the IRS later rejected the falsely filed returns. The fraudulently obtained tax refunds were used to purchase personal items, including a 2002 Mercedes E320 Sedan.
Co-defendant Lucille Stansberry was previously sentenced by Judge Burgess to 36 months and one day in prison. She was also ordered to pay restitution in the amount of $48,619.95. The fourth co-defendant charged in the case, Demetrick Ruffin, remains a fugitive.
During both sentencing hearings, the victims of this conspiracy spoke at length about the devastating effects these crimes have had on their lives, recounting their difficulties securing loans, paying for their children’s education, and providing for themselves in retirement.
In sentencing Bolton-Williams, Judge Burgess referenced the victims’ statements and noted the profound and continuing impact that identity theft crimes have on innocent victims who often find it difficult, if not impossible, to correct the effects such crimes have on their daily lives. He also commented on the fact that these types of crimes have been expanding in recent years, which was one of several factors he considered in fashioning the sentences in this case. Regarding Bolton-Williams, whose criminal history included multiple previous convictions for identity theft and fraud-related crimes, Judge Burgess was particularly adamant that any sentence he handed down should be designed to protect the public from future crimes.
U.S. Attorney Karen Loeffler noted, “Identity theft in any of its myriad manifestations is a pernicious crime that causes untold and lasting difficulties to its victims. In addition, tax fraud affects and damages the vast majority of hard-working American taxpayers. These significant sentences reflect the damage done and federal law enforcement’s commitment to prosecuting those who perpetuate these crimes.”
“Refund fraud is a top priority for the IRS,” said Special Agent in Charge Teri Alexander of the IRS Seattle Field Office. “The sentences handed down to these defendants show that IRS Criminal Investigation and the US Attorney’s Office are committed to fighting this growing epidemic. Justice has been served on those who conspired to steal from the government and every U.S. taxpayer, but more importantly, we hope these sentences provide some sense of closure for the victims whose lives were so affected by the nefarious deeds of these identity thieves.”
This case was prosecuted by Assistant US Attorneys Retta-Rae Randall and Stephanie C. Courter. IRS Criminal Investigation investigated the case.
Ms. Loeffler commends the IRS Criminal Investigation for the investigation leading to the convictions in this case.
Trans Energy Inc. to Restore Streams and Wetland Damaged by Natural Gas Extraction Activities in West VirginiaRead the Press Release
The Department of Justice, the U.S. Environmental Protection Agency (EPA) and the West Virginia Department of Environmental Protection (WVDEP) today announced a settlement with Trans Energy Inc., requiring the oil and gas company to restore portions of streams and wetlands at 15 sites in West Virginia that were polluted by the company’s unauthorized discharge of dredge or fill material. Trans Energy will pay a penalty of $3 million to be divided equally between the federal government and the WVDEP. The Clean Water Act requires a company to obtain a permit from EPA and the U.S. Army Corps of Engineers prior to discharging dredge or fill material into wetlands, rivers, streams and other waters of the United States.
“Today’s agreement requires that Trans Energy take important steps to comply with state and federal laws that are critical to protecting our nation’s waters, wetlands and streams,” said Sam Hirsch, Acting Assistant Attorney General of the Justice Department’s Environment and Natural Resources Division. “We will continue to ensure that the development of our nation’s domestic energy resources, including through the use of hydraulic fracturing techniques, complies with the Clean Water Act and other applicable federal laws.”
“As part of our commitment to safe development of domestic energy supplies, EPA is working to protect wetlands and local water supplies on which communities depend,” said Cynthia Giles, Assistant Administrator of EPA’s Office of Enforcement and Compliance Assurance. “By enforcing environmental laws, we’re helping to ensure a level playing field for responsible businesses."
In addition to the penalty, the company will reconstruct impacted aquatic resources or otherwise address impacts at each of the 15 sites, provide appropriate compensatory mitigation for impacts to streams and wetlands, and implement a comprehensive compliance program to ensure future compliance with Section 404 of the Clean Water Act and applicable state law. Among other requirements, the company will work to ensure that all aquatic resources are identified prior to starting work on any future projects in West Virginia, and that appropriate consideration is given at the design stage to avoid and minimize impacts to aquatic resources. It is estimated that Trans Energy will spend more than $13 million to complete the restoration and mitigation work required by the consent decree.
The federal government and the WVDEP allege that the company impounded streams and discharged sand, dirt, rocks and other materials into streams and wetlands without a federal permit in order to construct well pads, impoundments, road crossings and other facilities related to natural gas extraction. The government alleges that the violations impacted approximately 13,000 linear feet of stream and more than an acre of wetlands.
Filling wetlands illegally and damming streams can result in serious environmental consequences. Streams, rivers and wetlands benefit the environment by reducing flood risks, filtering pollutants, recharging groundwater and drinking water supplies, and providing food and habitat for aquatic species.
EPA discovered the violations in 2011 and 2012 through information provided by WVDEP and the public, and through routine field inspections. In summer 2014, the company conducted an internal audit and ultimately disclosed to EPA alleged violations at eight additional locations, which are also being resolved through this Consent Decree.
The settlement also resolves alleged violations of state law brought by the WVDEP.
The consent decree has been lodged in the Northern District of West Virginia and is subject to a 30-day public comment period and court approval. The settlement can be viewed at www.justice.gov/enrd/Consent_Decrees.html .
Topeka Man Pleads Guilty to Robberies in Topeka, ManhattanRead the Press Release
TOPEKA, KAN. – A Topeka man on Tuesday pleaded guilty to committing robberies at businesses in Topeka and Manhattan, U.S. Attorney Barry Grissom said.
Christopher James Wilhoite, 26, Topeka, Kan., pleaded guilty to two counts of commercial robbery and one count of unlawful possession of a firearm in furtherance of a robbery. In his plea, Wilhoite admitted that on March 29, 2014, he robbed a clerk at Car Toyz, 5849 S.W. 21st in Topeka. The store sells mobile audio, video and vehicle security systems.
Wilhoite entered the store, browsed for a few minutes, and told the clerk: “I know what I want – the money.” He took money from the register and from the clerk’s wallet before loading some electronic items into a bag. When he noticed a surveillance camera, he forced the clerk to show him the recorder and threw that in the bag, too. Then he fled the store. Investigators later found his fingerprints in the store.
Wilhoite also admitted that on April 16, 2014, he robbed the Dollar General at 2321 Tuttle Creek Boulevard in Manhattan, Kan. He pointed a gun at a clerk and said: “Hey, I need money.” He put the clerk and another employee in a bathroom at gunpoint and told them to count to 200 while he fled the store.
Sentencing is set for Nov. 21. Both parties have agreed to recommend a sentence of 12 years in federal prison.
Grissom commended the Topeka Police Department, the Riley County Police Department, the FBI and Assistant U.S. Attorney Jared Maag for their work on the case.
Three Alabama Men Plead Guilty to Stolen Identity Refund Fraud SchemeRead the Press Release
Three residents of Montgomery, Alabama, each pleaded guilty during the past week to one count of conspiracy to defraud the government and one count of aggravated identity theft, announced Deputy Assistant Attorney General Ronald A. Cimino of the Justice Department’s Tax Division and U.S. Attorney George L. Beck Jr. for the Middle District of Alabama.
Cruz Castillo Burnett, Jacorey Giddens and Rodrickus Howard were indicted on May 1. According to court documents, the defendants conspired to acquire the means of identification of individuals, including names, Social Security numbers and dates of birth, of other persons without their knowledge or consent. From March 2011 to April 2013, the defendants used these stolen identities to file more than 500 false tax returns, and each return claimed fraudulent refunds from the Internal Revenue Service (IRS). The defendants received the fraudulent refunds in various forms, including U.S. Treasury checks, direct deposits to bank accounts and direct deposits onto prepaid debit cards in the names of identity theft victims.
The three defendants each face a statutory maximum sentence of 10 years in prison for the conspiracy count, followed by up to three years of supervised release. The defendants will each be required to serve a statutory mandatory sentence of two years in prison for the aggravated identity theft count.
The case was investigated by special agents of the IRS-Criminal Investigation. The case is being prosecuted by Trial Attorneys Greg Bailey and Michael Boteler of the Tax Division and Assistant U.S. Attorney Todd Brown for the Middle District of Alabama.
Additional information about the Tax Division and its enforcement efforts may be found at the division website .
The United States Sues Nursing Home Owners and Operators and Their Manager Under the False Claims ActRead the Press Release
SAN FRANCISCO – The United States filed a civil False Claims Act complaint on Friday against the owners, operators, and manager of two nursing homes in Watsonville, Calif., United States Attorney Melinda Haag announced.
Defendants CF Watsonville East, LLC, and CF Watsonville West, LLC, are for-profit entities that own and operate the nursing homes named in the complaint. Defendant ARBA Group owns CF Watsonville East and West, and exercised close oversight and control over the finances and operations of the nursing homes, and defendant Country Villa Health Service Corporation, dba Country Villa Health Services, was also responsible for the management of the nursing homes under consulting agreements with the owners.
The United States alleges that Defendants submitted false claims for materially substandard or worthless services provided to Medicare and Medicaid beneficiaries residing in the two nursing homes, Country Villa Watsonville East Nursing Center (renamed Watsonville Nursing Center in April 2014), and Country Villa Watsonville West Nursing and Rehabilitation Center (renamed Watsonville Post-Acute Center in April 2014). Specifically, the complaint alleges that between 2007 and 2012, defendants persistently and severely overmedicated elderly and vulnerable residents of the nursing homes.
The False Claims Act, 31 U.S.C. §§ 3729-3733, provides for treble damages and civil penalties against those who submit false claims to federal programs such as Medicare and Medicaid.
Gioconda Molinari is the Assistant U.S. Attorney who is litigating the case with the assistance of Lucille Yee and Tina Louie. The lawsuit is the result of an investigation by the U.S. Attorney’s Office and the U.S. Department of Health and Human Services, Office of the Inspector General.
If you know someone who is the victim of elder abuse, neglect, or exploitation in a nursing home, you can report it to the California Long-term-Care Ombudsman, 1-800-231-4024, http://www.aging.ca.gov/Programs/LTCOP/, your local California Department of Public Health, Licensing and Certification Division, District office, http://www.cdph.ca.gov/HealthInfo/Pages/NursingHomePatient.aspx, your local adult protective services office, and/or the police.(Country Villa complaint )
Tallahassee Woman Indicted for Using Fraudulent IRS StampsRead the Press Release
TALLAHASSEE, FLORIDA– United States Attorney Pamela C. Marsh, Northern District of Florida, announced that Elisa Christina Avila Jackson, 30, of Tallahassee, Florida, was arraigned this afternoon in court after being charged by a federal grand jury with five counts of wire fraud and one count of possessing a counterfeit Internal Revenue Service (“IRS”) stamp.
The indictment alleges that between June 7, 2011, and February 11, 2014, Jackson conducted a scheme to defraud owners of large tractor trailers around the State of Florida of monies that were to be paid to the IRS relating to the federal Heavy Highway Vehicle Use Tax. Jackson operated Bee’s Carrier Permitting and Licensing, Inc. (“BCPL”), which purportedly provided assistance to owners of large tractor trailers in preparing and filing their annual applications for registration with the State of Florida. As mandated by federal regulation, prior to issuing a vehicle registration, the Florida Department of Highway Safety and Motor Vehicles required BCPL and others applying for annual large tractor trailer registrations to provide a copy of a tax form stamped by the IRS as proof that the owner’s federal Heavy Highway Vehicle Use Tax had been paid.
The indictment further alleges that Jackson collected from BCPL customers the amount due and owing to the IRS for the Heavy Highway Vehicle Use Tax and promised to pay that amount to the IRS. However, rather than paying the Heavy Highway Vehicle Use Tax to the IRS, Jackson created fraudulent IRS forms bearing a counterfeit IRS numbered remittance stamp, which forms falsely reflected that these taxes had been remitted to the IRS. The indictment also charges that through this scheme, Jackson fraudulently obtained approximately $248,000.00.
Counts One through Five of the indictment charge Jackson with wire fraud. For each of these counts, if convicted, Jackson faces a term of imprisonment of not more than twenty (20) years, a period of supervised release of up to three (3) years, a fine of up to $250,000, and a $100 special monetary assessment. Count Six of the indictment charges Jackson with possession of an IRS stamp with intent to defraud. If convicted on this count, Jackson faces a term of imprisonment of not more than five (5) years, a period of supervised release of up to three (3) years, a fine of up to $10,000, and a $100 special monetary assessment.
The trial of this case is scheduled for November 3, 2014, before the Honorable Robert L. Hinkle.
The indictment results from an investigation by the IRS-Criminal Investigation, with the assistance of the Florida Highway Patrol and Florida Department of Highway Safety and Motor Vehicles, Bureau of Commercial Vehicle and Driver Services. The case is being prosecuted by Assistant United States Attorney Jason Beaton.
An indictment is merely an allegation by a grand jury that a defendant has committed a violation of federal criminal law and is not evidence of guilt. The defendant is presumed innocent and entitled to a fair trial, during which it will be the government’s burden to prove guilt beyond a reasonable doubt at trial in a court of law.
St. Croix Man Sentenced for Marijuana PossessionRead the Press Release
St. Croix, USVI – On Thursday August 28, 2014, Chief District Court Judge Wilma A. Lewis sentenced Fernando Cabret III, 30, to three months of home confinement, a fine of $2,500.00, $25.00 special assessment and one year of federal supervised release for possession of marijuana. Chief Judge Lewis also sentenced Cabret, to 60 hours of community service to speak publicly about the crime he committed, the consequences suffered and how his life has changed.
Court records show that Cabret was arrested on August 14, 2013 after federal agents and Task Force officers searched his home pursuant to a warrant and seized 23 rooted and eight cut or up-rooted marijuana plants, small amounts of processed marijuana and marijuana cultivation equipment. He was initially charged with the possession of marijuana with intent to distribute and later pleaded guilty to possession of marijuana.
The case was investigated by the Drug Enforcement Administration and prosecuted by Assistant U.S. Attorney Rhonda Williams-Henry.
Robber Sentenced to over 19 Years in Prison for Armed Robbery of Seven Convenience Stores During an Eight Day SpreeRead the Press Release
Baltimore, Maryland – U.S. District Judge William D. Quarles, Jr. sentenced Gary Cordell Howard, age 37, of Baltimore, today to 235 months in prison, followed by five years of supervised release, for robbery and brandishing a gun in furtherance of robbery.The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Baltimore City State’s Attorney Gregg L. Bernstein; and Baltimore Police Commissioner Anthony W. Batts.
According to their plea agreements, Howard, and co-defendants Monte Glascoe, and Michael Emmanuel Smith robbed at least seven Baltimore 7-Eleven stores from July 18 to 26, 2013, located at: 6314 Eastern Avenue; 3436 Wilkens Avenue; 5512 Park Heights Avenue; 2500 Liberty Heights Avenue; 6700 Brentwood Avenue; 211 West 28th Street; and 3204 Hollins Ferry Road. As part of the conspiracy, Howard, Glascoe and Smith would generally decide which store to rob, steal a vehicle for use during the robbery; brandish a firearm during the robbery; and steal money and cigarettes during the robbery. In each robbery, Glascoe pointed a gun at victim employees. The conspirators stole money from the cash registers, cigarettes and other merchandise, and stole cash, a cell phone and folding knife from employees at the stores.
Monte Glascoe, age 24, and Michael Emmanuel Smith, age 28, both of Baltimore, previously pleaded guilty to their participation in the robberies and are scheduled to be sentenced on September 25, 2014 at 10:00 a.m. and October 1, 2014, at 1:00 p.m., respectively.
United States Attorney Rod J. Rosenstein commended the FBI, Baltimore Police Department and Baltimore City State’s Attorney’s Office for their work in the investigation. Mr. Rosenstein thanked Special Assistant United States Attorney Matthew K. Hoff, a cross-designated Baltimore City Assistant State’s Attorney assigned as part of the Baltimore initiative to combat violent crime, who prosecuted the case.
Richard Joseph Salon Spa Owners Sentenced to Prison for Tax Fraud ConspiracyRead the Press Release
BIRMINGHAM -- A federal judge today sentenced the owners and operators of Richard Joseph SalonSpas in the Birmingham area to three years in prison for conspiring to avoid paying more than $1 million in employment taxes to the IRS, announced U.S. Attorney Joyce White Vance and Internal Revenue Service Criminal Investigation Special Agent in Charge Veronica Hyman-Pillot.
U.S. District Judge Abdul K. Kallon sentenced both RICHARD JOSEPH SMITH, 54, and TIMOTHY EUELL BROWN, 55, to prison for the tax fraud conspiracy in which they failed to pay employment taxes to the IRS that they withheld from employees' wages over eight years from 2006 to 2013. Smith and Brown pleaded guilty to the charge in May, and acknowledged that they also skimmed money from the salons for personal use. Their prison reporting dates have not been set.
The judge ordered the men to pay $1.4 million in restitution to the IRS, which they had agreed to as part of their plea agreements with the government. The $1.4 million represents only the payroll taxes withheld from employees, not the employer portion of payroll taxes, which also went unpaid.
The government is seeking an order restraining the defendants' assets and directing the proceeds from the sale of personal property be applied to the restitution.
The men's Hoover home was lavishly furnished with antiques, art, fine china and chandeliers. The house is now for sale and most of the furnishings have been moved into storage. The IRS has a tax lien on the house for unpaid employment taxes, predating the current prosecution. Any proceeds from the home sale would go, first, to satisfy the tax lien.
"These defendants lived a high-end lifestyle of luxury at the expense of their employees and the nation's tax-paying citizens," Vance said. "They deducted more than $1 million in payroll taxes from their workers' wages, but they kept the money for themselves instead of lawfully paying the money to the IRS, leaving more than 100 employees uncertain about their future benefits and security," she said. "Prosecutions like this protect hard-working Americans."
“Employment tax fraud has a huge impact on our nation’s tax system. It results in loss of revenue to the government and affects the livelihood of the victims," Hyman-Pillot said. “Richard Smith and Tim Brown abused the trust of many people and must be held accountable for their corrupt actions. IRS Criminal Investigation will continue to enforce our nation’s tax laws and investigate individuals who choose to disregard those laws for personal benefit,” she said.
Richard Joseph SalonSpa has been a prominent business for more than two decades in the Birmingham area, with Smith as master stylist and Brown as business manager handling finances, including payroll, according to government documents.
By neither paying over to the IRS the taxes they withheld from their employees, nor reporting and paying taxes on their individual incomes, Brown and Smith lived an extravagant lifestyle, according to the government's Aug. 27 sentencing memorandum.
Brown bought the couple's home in the Preserve neighborhood in Hoover in 2005 for $891,000, and they have maintained the $5,245 monthly mortgage payment, according to the memorandum. In 2008 and 2009, they paid more than $80,000 to add a swimming pool and outdoor fireplace. The two men also employed as many as four full-time staff to perform housework, lawn maintenance, elder care for a live-in relative, and pet care for their 12 dogs, according to the sentencing memorandum.
The defendants' tax fraud proceeded as follows, according to government documents:
Beginning in 1991, a company called Smith, Hobart & Brown operated Richard Joseph SalonSpa in Mountain Brook, and Brown was the sole owner and registered agent of SHB. SHB operated the spa from 1991 to July 2006. SHB owed more than $300,000 in employment taxes to the IRS by the third quarter of 2006. The IRS began notifying Brown of payroll tax deficits and requesting payment in 2004. When a revenue officer met with Brown and his accountant in 2007, Brown said he had closed his salon in July 2006 and no longer worked at Richard Joseph SalonSpa.
While the daily operation and management of Richard Joseph SalonSpa never changed, Smith incorporated a new company, RJSS Inc., in June 2006. RJSS took over operation of Richard Joseph SalonSpa in Mountain Brook, and Smith and Brown opened a business checking account together for RJSS, listing both men as its owners.
Brown misrepresented to the IRS that he closed his salon business in 2006 and no longer worked at Richard Joseph Salon, the government said in its sentencing memorandum. Rather than closing the salon, he transferred its ownership to Smith and "carried forward with business as usual."
In August 2008, Smith incorporated another business, Richard Joseph Redmont Group Inc., and he and Brown together opened a business checking account for it. In July 2009, Smith and Brown opened a Richard Joseph Salon on U.S. 280 in Inverness, and operated it through the Redmont Group.
Between 2006 and 2013, Smith and Brown withheld the $1.4 million from employees of RJSS and Redmont group and failed to pay it over to the IRS in employment taxes.
IRS Criminal Investigation Division investigated the case, which Assistant U.S. Attorney Robin Beardsley Mark prosecuted.