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Friday 11 July 2014
Miami Resident Sentenced to Five Years in Federal Prison for Tax FraudRead the Press Release
TALLAHASSEE, FLORIDA – Pamela C. Marsh, United States Attorney for the Northern District of Florida, announced that Ashley Assgill Glover, 29, of Miami, Florida, was sentenced to five years in federal prison after pleading guilty to one count of theft of government property, one count of possession of unauthorized devices, and one count of aggravated identity theft.
U.S. District Court Judge Mark Walker sentenced Glover on July 10, 2014, to a five year prison term followed by three years of supervised release. Glover was also ordered to pay the Internal Revenue Service restitution in the amount of $216,031.
On March 12, 2012, the Tallahassee Police Department stopped Glover, and found her in possession a list of more than 800 victims’ personal identifying information (PII). There were also debit cards loaded with tax refunds linked to fraudulent tax returns. Sixty fraudulent tax returns were filed during the 2012 tax season in the names of victims on the list. These returns claimed approximately $369,848 in fraudulent refunds.
In June 2012, Glover was stopped by Coral Springs Police Department and found in possession of a list including over 160 victims’ PII. In November 2012, Glover was stopped by the Florida Department of Agriculture and found in possession of yet another list containing over 600 victims’ PII.
During the 2012 tax season, there were 206 fraudulent tax returns filed using information from the three recovered lists seeking approximately $1,246,417 in fraudulent refunds. Fortunately, the Internal Revenue Service detected most of the fraudulent tax returns and stopped the issuance of more than a million dollars in fraudulent refunds.
U.S. Attorney Marsh praised the work of the Tallahassee Police Department, the United States Secret Service, the Internal Revenue Service, and the Florida Department of Agriculture, whose joint investigation led to the convictions in the case.
The case was prosecuted by Assistant U.S. Attorney Winifred L. Acosta Nesmith.
Mexican Citizen Charged with Attempting to Transport A Minor from Las Vegas to Jacksonville for the Purpose of Engaging in Illegal Sexual ActivityRead the Press Release
Jacksonville, Florida – United States Attorney A. Lee Bentley, III announced today that Javier Guerrero Molina (33, citizen of Mexico) has been charged by a federal criminal complaint with transporting and attempting to transport a minor child from Las Vegas to Jacksonville with intent that the child engage in illegal sexual activity. If convicted, Molina faces a mandatory minimum sentence of 10 years, up to life in federal prison. Molina was arrested on May 30, 2014 at the Jacksonville International Airport. He has been in custody on related state charges since that time. A detention hearing is scheduled for July 14, 2014 at 10:00 a.m. before United States Magistrate Judge Monte C. Richardson.
According to the criminal complaint, during the afternoon of May 29, 2014, officers with the Jacksonville Aviation Authority Police Department (JAAPD) received a telephone call from an individual who advised that a particular female minor child had disappeared from her home in Las Vegas and was believed to be traveling by air to Jacksonville, Florida. JAAPD officers queried the National Crime Information Center and learned that the Las Vegas Metropolitan Police Department (LVMPD) had made a “missing persons” entry regarding a 14-year old female child with the same name. A check of airline manifests confirmed that this minor child was listed as a passenger on board a flight from Las Vegas to Jacksonville, with a connection in Charlotte, North Carolina. JAAPD coordinated with officers from the Charlotte-Mecklenberg Police Department (CMPD), who intercepted the child at the Charlotte International Airport and took her into protective custody. The child had been scheduled to board a flight from Charlotte to Jacksonville, due to arrive shortly after midnight on May 30, 2014.
The criminal complaint alleges that, as the expected arrival time for the Jacksonville flight approached, a JAAPD officer observed Javier Guerrero Molina in a waiting area in the Jacksonville International Airport lobby. When asked by the officer, Molina advised that he was there to meet a particular passenger. Molina was subsequently detained.
During an interview, Molina admitted that he entered the United States in 1999 or 2000 by paying a smuggler $700 to help him cross the border on foot near Laredo, Texas. Record checks confirmed that there is no record of Molina legally entering the United States or ever having legal status in this country. Molina also stated that he had previously engaged in sexual activity with the child in Jacksonville, before the child and her family moved to Las Vegas. He also stated that he sent the child money to pay for a one-way airline ticket from Las Vegas to Jacksonville, and that he expected their sexual relationship to continue when the child returned to Jacksonville.
A criminal complaint is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent until, and unless, proven guilty. This case was investigated by the Jacksonville Aviation Authority Police Department, the Las Vegas Metropolitan Police Department, the Jacksonville Sheriff’s Office, the Federal Bureau of Investigation (Jacksonville and Charlotte, North Carolina), the Charlotte-Mecklenberg Police Department, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, and the Jacksonville State Attorney’s Office. It is being prosecuted by Assistant United States Attorney D. Rodney Brown.
It is another case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visitwww.usdoj.gov/psc.
Meriden Man Pleads Guilty to Stealing Social Security Disability Benefits, Tax FraudRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that JOSEPH LUCA, 68, of Meriden, waived his right to indictment and pleaded guilty today before U.S. District Judge Michael P. Shea in Hartford to federal theft and tax offenses.
According to court documents and statements made in court, in April 1993, LUCA applied for Social Security Disability Insurance (“SSDI”) claiming that he was disabled and unable to work. From January 2002 through April 2011, LUCA regularly reported to the Social Security Administration, under the penalty of perjury, that he remained unable to work and he reported no earned income. In fact, during this time, LUCA earned more than $1,000 per month from his work as a hairdresser at a beauty salon he owned and operated. LUCA was not entitled to SSDI payments during this entire period because his earnings exceeded the SSA monthly substantial gainful activity limit.
An undercover investigation revealed that LUCA typically opened his beauty salon in the morning from Tuesday to Saturday each week, cut and styled his clients’ hair throughout the day in exchange for payment, and then locked up the salon at night. Throughout the day, he stood while he worked without the assistance of a cane or similar device, and also carried and lifted items using his body and arms. During the investigation, LUCA told an undercover agent who was posing as a client that he had been styling hair for 45 years.
Based on LUCA’s false representations that he was disabled, unable to work, and reported no income, the Social Security Administration paid him, as well as his children as auxiliary beneficiaries, a total of $122,332 that he and his children were not entitled to receive.
In May 2011, the Social Security Administration terminated LUCA’s SSDI benefit payments.
LUCA also willfully signed and filed federal tax returns for the 2006 through 2009 tax years that failed to report a total of more $675,000 in additional taxable income. On each of these four tax returns, LUCA reported a loss and no tax due. The investigation determined that LUCA did not report his receipt of income from various sources, including rental real estate, work as a private investigator, interest on bank accounts, SSDI payments he was not entitled to receive, and capital gains on rental properties.
On his 2006 federal tax return alone, LUCA failed to report approximately $299,674 in additional income, with a tax due in the amount of $36,687.
LUCA pleaded guilty to one count of stealing government money and one count of filing a false federal tax return. Judge Shea scheduled sentencing for October 3, 2014, at which time LUCA faces a maximum term of imprisonment of 13 years and a fine of up to $500,000.
In addition, LUCA also has agreed to pay $122,332 in restitution to the Social Security Administration, and $64,093 in back taxes, plus penalties and interest.
LUCA was released pending sentencing.
This matter was investigated by the Internal Revenue Service – Criminal Investigation Division, and the Social Security Administration, Office of Inspector General – Office of Investigations. The case is being prosecuted by Assistant U.S. Attorney Peter S. Jongbloed with the assistance of Law Student Intern Owen Firestone.
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[email protected]Memphis Woman Sentenced in Tax Fraud Identity Theft SchemeRead the Press Release
Memphis, TN – Edward L. Stanton III, U.S. Attorney for the Western District of Tennessee, and Christopher A. Henry, Special Agent in Charge, IRS-Criminal Investigation, announced today that Nakita Brooks, 31, of Memphis, Tennessee, was sentenced by U.S. District Judge John T. Fowlkes, Jr. to serve 120 months in prison followed by three years of supervised release, and ordered to pay restitution of $690,767.84 to the Internal Revenue Service (IRS).
On April 11, 2014, Brooks pled guilty to one count of a three-count indictment charging her and co-conspirator, Cheryl Wright, 30, with conspiracy to file false tax returns, theft of public money and identity theft. According to the facts presented in the indictment and revealed during sentencing hearings, beginning as early as February 2010 through at least November 2011, Brooks and Wright filed hundreds of false tax returns using the personal identifying information of deceased individuals, including social security numbers.
In addition to filing false returns, Wright and Brooks also set up tax return services using stolen identities as the preparers of the returns. In 2010, the name of the company used to prepare the returns was Rattler’s Tax Pals. In 2011, the name of the company used to prepare the returns was Taxes Express. Three individuals, including a nine-year old girl from Indiana, had their tax information fraudulently listed as the preparers for these companies.
Wright is scheduled to be sentenced July 24, 2014, before U.S. District Judge John T. Fowlkes, Jr.
This investigation was conducted by IRS Criminal Investigation. Assistant U.S. Attorney David Pritchard represented the government.Massachusetts Fugitive Sentenced to 81 Months on Firearms and Identity Theft ChargesRead the Press Release
Contact: Darcie N. McElwee
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced that Gary
Irving, a/k/a “Gregory Irving” and “Gregg Irving,” 54, of Gorham, Maine, was sentenced
today in U.S. District Court by Judge George Z. Singal to 81 months in prison and three years of
supervised release for being a fugitive in possession of firearms and aggravated identity
theft. Irving pleaded guilty to the charges on March 27, 2014, a year after his apprehension for
being a fugitive for 34 years.Court records reveal that Irving was arrested in Maine on March 27, 2013 on a fugitive
warrant from Massachusetts for a 1979 conviction for rape and other crimes. At the time of his
arrest, he had nine firearms in his residence, including two illegal short-barreled firearms. He
had been living in Maine under a false identity since 1979. He fraudulently used his brother’s
name and social security number and an incorrect date of birth to renew his driver’s license. For
more than 16 of his years in Maine, he illegally used firearms to hunt.
The aggravated identity theft charge required imposition of a consecutive mandatory
minimum two year term in prison because Irving knew the social security number he illegally
used belonged to an actual person. In imposing sentence, Judge Singal said: “This isn't a
victimless crime, even on his own family. In my view, that's a serious set of events and deserves
a serious sentence."
Norfolk (Mass) District Attorney Michael W. Morrissey, whose office secured a 36 to 40
year state prison sentence in May 2013 for Irving’s rape and kidnapping convictions said “the
Maine State Police and all of the law enforcement partners who have been part of this
investigation and prosecution have done exemplary work.” He added “This is a man with a
proven capacity for extreme brutality. Law enforcement works best with cooperation across the
local, state and federal levels. That partnership here has made the public safer.”
The investigation was conducted by the Massachusetts and Maine State Police, the
Gorham Police Department, the Federal Bureau of Investigation, the Bureau of Alcohol,
Tobacco, Firearms and Explosives and the Social Security Administration - Office of Inspector
General.Maryland Man Sentenced to 10 Years in Prison for Series of Burglaries at University Dormitory-Took Laptops, Other Items in January 2013 at George Washington University-Read the Press Release
WASHINGTON - James Dunmore, 40, of Hyattsville, Md., was sentenced today to 10 years in prison on charges stemming from a series of burglaries he committed last year at George Washington University, U.S. Attorney Ronald C. Machen Jr. announced.
Dunmore pled guilty in July 2013 in the Superior Court of the District of Columbia to a total of 12 charges, including first-degree burglary, second-degree burglary, second-degree theft, and unlawful entry. He was sentenced by the Honorable Robert I. Richter. Upon completion of his prison term, Dunmore will be placed on a period of supervised release.
According to a proffer of evidence, signed by the defendant as well as the government, Dunmore entered a total of five apartments in January 2013 in the Ivory Tower Dormitory at George Washington University in Northwest Washington. Over two separate days, he took various electronic items, including laptops, and other property belonging to nine students.
The series of crimes began on Jan. 25, 2013. That day, Dunmore entered the residence hall and went into a student’s apartment while the student was in the shower. He took a laptop and the student’s wallet, which contained the student’s G-World card, a student ID card that can be used to electronically gain entry to the university’s buildings.
Then, on Jan. 28, 2013, Dunmore entered four more apartments in the same building. He got into the residence hall at about 1:30 p.m. by following another student into the building. First, he went to the sixth floor, where he entered three separate apartments. He took a pillowcase, three laptops, a camera, and an iPod from one apartment. In another, a student was asleep in bed when Dunmore entered the room and pretended to be looking for someone he knew; he took an iPod from that apartment. He went into a third apartment on the sixth floor, but left without taking anything after he saw someone there. Dunmore then went to the building’s third floor and entered yet another apartment, taking two laptops, a video game system, and a student’s suitcase, which he used to carry the items away.
One student became suspicious of Dunmore’s activities and alerted campus police, who stopped Dunmore on his way out of the building with the stolen items in his possession.
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In announcing the sentence, U.S. Attorney Machen expressed his appreciation to the Metropolitan Police Department and the George Washington University Police Department. He also acknowledged the efforts of Paralegal Specialists Allison Gregory Daniels and Victim/Witness Advocates Kristina Rose and Katina Adams-Washington, as well as former Intern Julie Herward. Finally, he commended the work of Assistant U.S. Attorney Scott Sroka, who investigated and indicted the case.Man Who Received over $3 Million Selling Unregistered Diamond Mine Stock Sentenced to Four Years in PrisonRead the Press Release
LAS VEGAS, Nev. – A former Las Vegas resident who made over $3 million from selling unregistered penny stock in a purported diamond mine company known as CMKM, has been sentenced to four years in prison, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
Marco Glisson, 59, formerly of Las Vegas, but most recently of Miami, Fla., was sentenced on July 10, 2014, by U.S. District Judge Larry R. Hicks. Glisson pleaded guilty on Jan. 15, 2014, to conspiracy to offer and sell unregistered securities and tax evasion. Judge Hicks denied Glisson’s request for a self-surrender to prison, and ordered him into federal custody at the end of the sentencing hearing.
According to Glisson’s plea agreement, Glisson, who was not a registered broker or dealer of securities, conspired with others to purchase and sell CMKM, Inc. penny stock after the U.S. Securities and Exchange Commission (SEC) permanently revoked CMKM’s trading privileges. Beginning in about December 2005, Glisson, and his conspirators used a transfer agent/company known as Global Stock Transfer LLC to cancel CMKM’s stock certificates that were held in the names of other co-conspirators and reissue them to Glisson. Glisson marketed the stock in internet chat rooms under the name “Deli dog” or Deli,” and also used the mail and other resources to offer and sell it. As Glisson sold the shares of CMKM stock, the stock transfer company would cancel them and reissue them to the purchasers. From December 2005 to May 2006, Glisson sold billions of shares of CMKM stock to at least 65 different persons in the United States and Canada. In June 2006, the SEC contacted Glisson and told him that it was illegal to publicly offer and sell unregistered securities. Glisson stopped selling the CMKM stock for a few months, but in September 2006, he resumed offering and selling the CMKM stock and continued selling it until April 2007. Glisson’s sales of billions of unregistered shares of CMKM stock from 2006 to 2007 yielded him more than $1.7 million.
Glisson failed to pay the federal income taxes he owed for 2006 and 2007, and instead took affirmative acts to hide the income, such as placing money in bank accounts under the name of his wife and others and using cash. As a result, Glisson owes over $400,000 in back taxes to the IRS for 2006 and 2007.
Ten co-conspirators were also charged in a separate case pending in the District Court for the District of Nevada. Five are pending trial, one pleaded guilty and is awaiting sentencing, one is a fugitive, one is awaiting extradition, one is deceased, and the charges against another were dismissed.
The case is being investigated by the FBI and IRS Criminal Investigation, and prosecuted by Assistant U.S. Attorneys Kathryn Newman and Andrew Duncan.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. 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. Since the inception of FFETF in November 2009, the Justice Department has filed more than 12,841 financial fraud cases against nearly 18,737 defendants including nearly 3,500 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.Lynnwood Company and Owner Sentenced for Trafficking in Counterfeit GoodsRead the Press Release
CONNECTZONE.COM, LLC, a Lynnwood, Washington electronics company, and its owner, DANIEL OBERHOLTZER, were sentenced today in U.S. District Court in Seattle for conspiracy to traffic in counterfeit goods, announced U.S. Attorney Jenny A. Durkan. Company owner DANIEL OBERHOLTZER was sentenced to 37 months in prison, and three years of supervised release. He was also ordered to forfeit $716,778.55 in proceeds from the sales of counterfeit goods. The company was sentenced to five years organizational probation and also ordered to forfeit $716,778.55 in proceeds from the crime.
According to the evidence introduced as part of the case, CONNECTZONE.COM, LLC operated websites that advertised and sold computer networking products. These included products bearing trademarks owned by U.S. company Cisco; but the investigation revealed that CONNECTZONE.COM, LLC instead obtained its products from multiple foreign suppliers of counterfeit goods including a Chinese firm, SHENZHEN XIEWEI ELECTRONIC, LTD, headquartered in Shanghai, and its representative, MAO MANG, aka “BOB MAO.”
At sentencing, the Honorable Richard A. Jones commented that OBERHOLTZER’s crimes were aggravated by the fact that because of the quality problems with the counterfeit goods, OBERHOLTZER “had no idea what might happen when the counterfeit Cisco products he sold failed.” Judge Jones also noted that the sentence of 37 months should “send a message to anyone else thinking about being involved in counterfeit goods.”
“Innovation and our economy demand that the intellectual property of businesses be protected,” said U. S. Attorney Durkan. “Here, the defendants used the hard earned brands of others and slapped it on inferior products.”
“Counterfeiting high dollar goods can be very lucrative for enterprising criminals,” said Brad Bench, special agent in charge of HSI Seattle. “Their illicit activities ultimately come at the expense of trademark owners and consumers. They don’t contribute to research and development and the knockoffs they sell generally don’t match the quality and safety of genuine items.”
In total, four individuals and two companies were charged in the Indictment returned in January 2013, including SHENZHEN XIEWEI ELECTRONIC, LTD, and BOB MAO .
Defendant EDWARD VALES was sentenced on June 13, 2014, to two years of probation and five months of home confinement for one count of Mail Fraud. Defendant LANCE WILDER was convicted of conspiracy to traffic in counterfeit goods, two counts of mail fraud and four counts of trafficking in counterfeit goods following a jury trial on April 7, 2014. Mr. WILDER is scheduled to be sentenced before The Honorable Richard A. Jones on July 25, 2014.
The evidence admitted at trial established that as early as 1997, while the company was operating under a different name, Electro Products, Incorporated, it was distributing counterfeit equipment manufactured in China. DANIEL OBERHOLTZER, LANCE WILDER and EDWARD VALES would advise BOB MAO and XIEWEI ELECTRONICS and other Chinese companies regarding how to manufacture products that would look like genuine Cisco trademarked goods. Some of the goods would be labeled “samples” when shipped to the U.S. to try to deceive U.S. Customs officials. The U.S.-based conspirators falsely advertised the counterfeit goods as genuine and offered it for sale at a much lower price than genuine Cisco equipment. The evidence included numerous emails sent between the conspirators as they ran their scheme including e-mails describing a plan for “Operation Cisco” in which the defendants laid out their plan to obtain counterfeit Cisco products.
This case was investigated by the Seattle-Tacoma Border Enforcement Security Task Force (BEST), led by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and comprised of officers and investigators from U.S. Customs and Border Protection’s Office of Field Operations; the U.S. Secret Service; the U.S. Coast Guard Investigative Service; the FBI; the U.S. Postal Inspection Service; the Seattle Police Department and the Port of Seattle Police Department. BEST Seattle investigates smuggling and related crimes and combats criminal organizations seeking to exploit vulnerabilities at the Seattle and Tacoma seaports and adjacent waterways.
The case is being prosecuted by Assistant United States Attorneys Norman Barbosa and Justin Arnold.
Press contact for the U.S. Attorney’s Office is Tessa Gorman, at 206-553-7970, or [email protected].
Lutherville Man Sentenced to 7 Years in Prison for Possession and Distribution of Child PornographyRead the Press Release
Baltimore, Maryland – U.S. District Judge Catherine C. Blake sentenced Brian Shaw, age 23, of Lutherville, Maryland, today to 7 years in prison, followed by lifetime supervised release, for distribution and possession of child pornography. Judge Blake ordered that upon his release from prison, Shaw must register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge William Winter of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI).
According to court documents and testimony at today’s sentencing hearing, from December 18, 2012 through January 12, 2013, Shaw distributed images and videos documenting the sexual abuse of children, including prepubescent minors, to an undercover agent with HSI New Orleans. A search warrant was obtained for Shaw’s email account. From November 26, 2011 through January 29, 2013, Shaw’s email contained approximately 2140 emails, most of which referenced the trade of child pornography over the internet and the sexual exploitation of children. Upon the creation of the account, Shaw immediately began emailing others to trade child pornography files. In addition to attaching hundreds of videos and images of child pornography, Shaw also sent links for file sharing services in his email, which gave access to child pornography files.
Based on the evidence in Shaw’s emails, HSI obtained a search warrant for his residence. Law enforcement seized and subsequently forensically examined Shaw’s computer and other digital media. Approximately 5860 images and 562 videos of children engaged in sexually explicit conduct, as well as stories describing sex acts with children in graphic detail, were located during the forensic analysis. Some of the images included sadistic or masochistic conduct, or other depictions of violence, and depicted children under the age of 12.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc. For more information about internet safety education, please visit www.justice.gov/psc and click on the "resources" tab on the left of the page.
United States Attorney Rod J. Rosenstein commended HSI Baltimore for its work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Judson T. Mihok, who prosecuted the case.
Jury Finds Red Valley Man Guilty of Involuntary Manslaughter and Use of A Firearm in A Crime of ViolenceRead the Press Release
PHOENIX – On July 9, 2014, Joe Arviso Benally, 51, of Red Valley, Ariz., was found guilty of involuntary manslaughter and use (discharge) of a firearm in a crime of violence by a federal jury following a trial before U.S. District Judge G. Murray Snow. The defendant was remanded into custody after trial pending sentencing before Judge Snow on Sept. 29, 2014.
The evidence at trial showed that the defendant, after an argument with the victim, retrieved his .270 caliber hunting rifle, loaded it, and shot the victim in the chest, killing him.
A conviction for involuntary manslaughter carries a maximum penalty of 8 years, a $250,000 fine, or both. A conviction for use (discharge) of a firearm in a crime of violence carries a mandatory minimum penalty of 10 years, consecutive to the punishment for the crime of violence.
The investigation in this case was conducted by the Federal Bureau of Investigation and the Navajo Nation Department of Public Safety. The prosecution was handled by Melissa Karlen and Christina Covault, Assistant U.S. Attorneys, District of Arizona, Phoenix.
CASE NUMBER: CR-13-8095-PCT-GMS (DKD)
RELEASE NUMBER: 2014-038_BenallyFor more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.Jury Convicts Rochester Woman of Drug Trafficking and Rochester Man of Firearms OffensesRead the Press Release
ROCHESTER, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that a federal jury has found Ashley Travis, 29, of Rochester, N.Y., guilty of conspiracy to possess with intent to distribute crack cocaine and to maintain a drug involved premises, distribution of crack cocaine, possessing crack cocaine with intent to distribute, and maintaining a drug involved premises. The charges carry a maximum penalty of 20 years in prison and a fine of $1,000,000 or both.
In addition, the jury found Fawndell Henderson, 39, also of Rochester, guilty of being a felon in possession of a Smith and Wesson revolver and ammunition, as well as possessing a short-barreled Remington 20 gauge shotgun which was made in violation of the National Firearms Act and which was not registered to Henderson in the National Firearms Registration and Transfer Record. The charges carry a maximum penalty of 10 years in prison and a fine of $250,000 or both. The jury was unable to reach a verdict relating to various drug trafficking offenses and whether Henderson possessed the firearms in furtherance of the drug trafficking offenses.
Assistant U.S. Attorney Charles E. Moynihan, who handled the prosecution of the case, stated that on September 12, 2012, Henderson and Travis were arrested at 104 Weeger Street in Rochester, after police officers executed a search warrant at the location. Immediately prior to executing the search warrant, Travis sold four bags of crack cocaine to an undercover police officer. Once inside of the location, law enforcement officers found three additional bags containing crack cocaine, as well digital scales commonly used to measure drugs for distribution and small ziplock bags used to package drugs for distribution. Officers also located $201.00 in United States currency in Henderson’s pocket, as well as $40.00 in United States currency on a table in the residence.
Law enforcement officers also located and seized a loaded Smith and Wesson revolver and an unloaded Remington 20 gauge shotgun, which had the barrel shortened to a length of 14 and ¼ inches, testimony presented by the Government showed. The wooden stock of the shotgun was also removed. Furthermore, the testimony showed that the firearms were secreted in a compartment near the doorway to the residence in a location which would have been easily reachable by the children of Henderson and Travis, who were also found in the residence. Henderson confessed to police in a written statement after his arrest, admitting that he had been selling crack cocaine for several months from his house and the he possessed the firearms. The defendant said that he bought the shotgun from an addict in exchange for two bags of crack and that he had the shotgun for protection. Henderson also admitted to pointing it at rival drug dealers in the neighborhood. He also said that he took possession of the revolver from a friend because his friend had announced intention to use it against rival drug dealers.
The jury did not reach a verdict on firearms charges against Travis or drug trafficking charges against Henderson.
The convictions are the culmination of an investigation on the part of on the part of Special Agents of the Bureau of Alcohol Tobacco, Firearms and Explosives under the direction of Thomas J. Cannon, Special Agent in Charge, New York Field Division, and the Rochester Police Department, under the direction of Chief Michael Ciminelli.
Sentencing for both defendants is scheduled for September 30, 2014 at 10:00 a.m. before the U.S. District Judge David G. Larimer who presided over the trial of the case.Jury Convicts Mission Man in Marijuana ConspiracyRead the Press Release
McALLEN, Texas – A federal jury in McAllen has convicted Rogelio Guerrero, 50, a U.S. citizen residing in Mission, on one count of conspiracy to possess with intent to distribute and possession with intent to distribute large amounts of marijuana, announced United States Attorney Kenneth Magidson. The jury returned its verdict late this morning following a three-day trial and less than four hours of deliberation.
During the trial, the government presented testimony that Guerrero and his associates utilized tractor-trailers to transport large quantities of marijuana from Mission to Houston. The jury heard that Guerrero’s drivers transported between 3,000-5,000 pounds of marijuana to Houston every few weeks. The government also presented evidence that Guerrero owned nearly 10,000 pounds of marijuana that was seized in 2011.
He was convicted of conspiracy to possess with intent to distribute more than 1,000 kilograms of marijuana and possession with intent to distribute more than 100 kilograms of marijuana.
U.S. District Judge Micaela Alvarez, who presided over the trial, has set sentencing for Sept. 25, 2014. At that time, Guerrero faces a mandatory minimum of 10 years and up to life imprisonment as well as a possible $10 million fine. He will remain in custody pending that hearing.
Guerrero’s conviction is a culmination of an Organized Crime Drug Enforcement Task Force Operation dubbed “White Line.” The six-year investigation, targeting Guerrero and other significant drug traffickers based in Mission, was conducted by Homeland Security Investigations, Drug Enforcement Administration, Hidalgo County Sheriff’s Office, Mission Police Department, U.S. Border Patrol, Texas Department of Public Safety, Internal Revenue Service – Criminal Investigation and the FBI.
To date, there have been approximately 20 other convictions in relation to the investigation.
Assistant United States Attorneys Jesse Salazar and Robert Wells are prosecuting.
Jesup Brother and Sister Charged in Stolen Identity and Tax Fraud SchemeRead the Press Release
SAVANNAH, GA -- GREGORY ALLEN, 31, and LEISHA ALLEN, 33, brother and sister from Jesup, Georgia, were arraigned last week on a federal indictment for their alleged roles in a stolen identity and tax fraud scheme operating in Wayne County, Georgia. The federal indictment alleges that Leisha and Gregory Allen filed fraudulent tax returns in order to illegally obtain tax refund checks for their personal benefit. The indictment further alleges that the Allens filed hundreds of fraudulent tax returns using the stolen names and social security numbers of others, including deceased individuals, in order to claim over a million dollars in fraudulent tax refunds.
United States Attorney Edward J. Tarver said, “The burgeoning crime of stealing the identities of innocent people for the purpose of filing false tax returns places all Americans at risk. The damage to unsuspecting victims is severe and long-lasting. Identity thieves beware: this is a real crime, against real people, with real consequences. Know that you will be investigated, prosecuted, and sent to federal prison for your crimes. This case is one of many examples of the continuing efforts of federal law enforcement and the United States Attorney’s Office to combat identity-theft schemes designed to steal tax dollars.”
“This is a case of greed, deceit, manipulation and theft directed at the United States Department of Treasury and the American taxpayer,” stated Veronica F. Hyman-Pillot, Special Agent in Charge IRS Criminal Investigation. “We will continue to aggressively pursue identity theft in order to protect our nation’s tax system and millions of Americans who could fall prey to this crime.”
Mr. Tarver emphasized that an indictment is only an accusation and is not evidence of guilt. The defendants are entitled to a fair trial, during which it will be the government’s burden to prove guilt beyond a reasonable doubt.
The investigation of this case was led by the IRS Criminal Investigation. Assistant United States Attorney Tania D. Groover is prosecuting the case on behalf of the United States. For additional information, please contact First Assistant United States Attorney James D. Durham at (912) 201-2547.
Japanese Citizen Sentenced to More Than Four Years Imprisonment for Bank Fraud SchemeRead the Press Release
OAKLAND – Yasuhiro Watanabe was sentenced today to fifty-one months in prison, and ordered to pay $556,744.40 in restitution for conspiracy to commit bank fraud, announced U.S. Attorney Melinda Haag and FBI Special Agent in Charge David J. Johnson.
Watanabe pleaded guilty on March 21, 2014, to conspiracy to commit bank fraud. According to the plea agreement, Watanabe admitted that, between 2009 and early September 2013, he engaged in a scheme to defraud Compass Bank and Bank of America. The scheme involved multiple participants, and victimized bank branches in the Northern District of California, Nevada, and Arizona, among other places. Approximately once a month, Watanabe recruited individuals in Japan to travel with him to the United States for the purpose of opening bank accounts at Compass Bank and Bank of America. Once the accounts were opened, Watanabe funded the accounts by causing a $1,000 - $2,000 wire transfer to be made from bank accounts in Japan, to the newly-opened accounts held in the names of Watanabe’s coconspirators. Watanabe typically paid his coconspirators’ travel costs, and a fee of approximately $1,000, for their role in the scheme. Watanabe directed his coconspirators to obtain debit cards for the accounts and give them to Watanabe. He then used the cards in Japan to purchase goods valued in amounts in excess of the funds on deposit. Watanabe then sold those goods for cash. Watanabe’s fraud scheme caused combined losses to Compass Bank and Bank of America of $556,744.40.
Watanabe, 39, of Japan, was initially charged by complaint on Oct. 25, 2013. On Feb. 11, 2014, he was charged by Information with one count of conspiracy to commit bank fraud in violation of 18 United States Code, Section 1349. Under the plea agreement, Watanabe pleaded guilty to that sole count.
Watanabe has been in federal custody since his arrest at Seattle – Tacoma International Airport on Oct. 27, 2013.
The sentence was handed down by the Honorable Jon S. Tigar, United States District Court Judge, following the defendant’s guilty plea on one count in violation of 18 United States Code Section 1349. Judge Tigar also sentenced the defendant to a three year period of supervised release, in the event that Watanabe is not deported following his release from incarceration. The defendant will begin serving the sentence immediately.
Thomas E. Stevens is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Kathleen Turner. The prosecution is the result of an investigation by the Federal Bureau of Investigation.
(Watanabe information )
International Hacker Pleads Guilty to 2011 Global CyberattackRead the Press Release
Earlier today at the federal courthouse in Brooklyn, Qendrim Dobruna, a member of an international cybercrime organization that was responsible for a cyberattack that inflicted millions of dollars in losses on the global financial system over the course of two days in 2011, pleaded guilty to bank fraud. The defendant, who was extradited from Germany, and his co-conspirators hacked into the systems of a U.S.-based credit and debit card payment processor that processed debit card transactions for the American Red Cross in connection with disaster relief victims. The stolen card data was then disseminated worldwide and used in an “unlimited operation” that made $14 million in fraudulent withdrawals from ATMs across the globe.
The guilty plea was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, and Robert J. Sica, Special Agent in Charge, United States Secret Service, New York Field Office.
“The defendant and his associates hacked into the global financial system and helped themselves to funds using prepaid debit cards meant for the needy and vulnerable,” stated United States Attorney Lynch. “We will continue to work with our private sector partners to solve these 21st century heists and bring the perpetrators, no matter where in the world they may hide, to justice.”
“Our success in this case and other similar investigations is a result of our close work with our law enforcement partners,” said Secret Service Special Agent in Charge Sica. “The Secret Service worked closely with the Department of Justice and INTERPOL to share information and resources that ultimately brought Qendrim Dobruna to justice. This case demonstrates there is no such thing as anonymity for those engaging in data theft and fraudulent schemes.”
As described in the indictment, court filings in related cases, and public court proceedings, the cyberattack employed by the defendant and his co-conspirators is known in the cyber underworld as an “Unlimited Operation” – through its hacking “operation,” the cybercrime organization can access virtually “unlimited” criminal proceeds.
The “Unlimited Operation” begins when the cybercrime organization hacks into the computer systems of a payment card processor, compromises prepaid debit card accounts, essentially eliminates the withdrawal limits of those accounts, and manipulates the security protocols that would alert the victim to the attack. The compromised card data is then distributed to cells worldwide that use the data to encode magnetic stripe cards to use at ATMs. These sophisticated techniques enable the participants to withdraw literally unlimited amounts of cash until the operation is finally detected and shut down. “Unlimited Operations” are marked by three key characteristics: (1) the surgical precision of the hackers carrying out the cyberattack, (2) the global nature of the cybercrime organization, and (3) the speed and coordination with which the organization executes its operations on the ground. These attacks rely upon both highly sophisticated hackers and organized criminal cells whose role is to withdraw the cash as quickly as possible.
In February 2011 the defendant and his co-conspirators targeted a publicly traded credit and debit card processing company based in the United States that processed transactions for prepaid debit cards issued by the American Red Cross for disaster relief victims. After the hackers penetrated the payment card processor’s computer network, compromised the American Red Cross prepaid card accounts, and manipulated the balances and withdrawal limits, casher cells across the globe operated a coordinated ATM withdrawal campaign. In total, more than 15,000 ATM transactions were conducted in approximately 18 countries using the compromised disaster relief prepaid cards, resulting in $14 million in financial loss worldwide.
The defendant, also known by the aliases “cl0sEd” and “cL0z,” participated in the cyber-attack from overseas by obtaining account information from co-conspirators who directly hacked into the payment card processor’s database and selling that account information to other co-conspirators over the Internet, including to an individual in Brooklyn, New York. The defendant was arrested in an apartment in Stuttgart, Germany in March 2012 by the German federal criminal police and subsequently extradited to the United States.
In announcing the guilty plea, United States Attorney Lynch praised the extraordinary efforts of the Secret Service in investigating this complex network intrusion. Ms. Lynch also thanked the Department of Justice’s Office of International Affairs, INTERPOL, and the authorities in Germany for their assistance in effecting the defendant’s extradition.
Today’s plea took place before Senior United States District Judge I. Leo Glasser. When sentenced on October 24, 2014, the defendant faces up to 30 years in prison, a fine of up to $1 million, and forfeiture of the proceeds of his crimes.
The government’s case is being prosecuted by Assistant United States Attorney Amir H. Toossi.
The Defendant:
QENDRIM DOBRUNA
Age: 27
E.D.N.Y. Docket No. 12 CR 300 (ILG)
Hedge Fund Manager Convicted in Multi-million Dollar Investment FraudRead the Press Release
BATON ROUGE, LA – United States Attorney Walt Green announced today that JAMES R. HOLDMAN, age 59, of Zachary, Louisiana, pled guilty yesterday before U.S. District Judge James J. Brady to multiple counts of mail fraud based on his engaging in a scheme which defrauded investors out of millions of dollars. HOLDMAN had been scheduled for trial next week. As a result of his convictions, HOLDMAN faces a maximum term of imprisonment of forty (40) years and millions in fines and restitution to his victims.
HOLDMAN operated a hedge fund called Greenwing Capital Management, LLC. As the owner and operator of the fund, HOLDMAN solicited and received millions of dollars in investment funds from the victim investors, many of whom were retirees, including former military veterans as well as survivors of Hurricane Katrina. The victim investors hailed primarily from South Louisiana and Mississippi. Throughout 2008, HOLDMAN’s investments suffered substantial losses. However, HOLDMAN concealed his failed investments by falsely representing to the victim investors that their accounts were earning positive rates of return when, in fact, HOLDMAN had lost nearly all of their funds.
By making these false representations, HOLDMAN was able to defraud the victim investors into keeping their remaining money with Greenwing Capital and, in some cases, investing more money, thereby allowing HOLDMAN to continue receiving money in the form of fees for his own personal use and benefit. In order to continue to conceal his fraud, HOLDMAN continued to put the victim investors’ money at risk in an attempt to recoup his losses.
Ultimately, in October 2008, HOLDMAN sent out a form letter to victim investors falsely informing them that a sharp downturn in the stock market related to the financial crisis had caused a 98.67% loss in their investment in a one-month period and had forced him to close the fund. In fact, HOLDMAN had steadily been losing millions of the victim investors’ money throughout 2008.
U.S. Attorney Green stated: “Investment fraud is a devastating crime that goes on far too often. We will continue to pursue such matters aggressively, particularly when the victims include some of our community’s most vulnerable. My appreciation goes to our federal and state law enforcement partners, both here in Louisiana and in Texas and Mississippi, for helping us uncover and address this scheme.”
The case is being prosecuted by Assistant U.S. Attorneys Shubhra Shivpuri and Chris Dippel. The joint investigation was conducted by the Federal Bureau of Investigation, the Louisiana Office of Financial Institutions, the Texas State Securities Board, and the Securities and Charities Division of the Mississippi Office of the Secretary of State.
Getaway Driver Pleads Guilty to Armed Robbery of Belleville Liquor StoreRead the Press Release
Case is one of many brought as a result of the United States Attorney Stephen R. Wigginton’s Metro-East Armed Robbery Initiative
Follow @SDILNewsCharmonequette Reynolds, 22, plead guilty in United States District Court to a three-count indictment charging her with Conspiracy to Interfere with Commerce by Robbery, Interference with Commerce by Robbery, and Use of a Firearm During a Crime of Violence, Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today. The Armed Robbery counts arise from the federal Hobbs Act, which makes it a crime to obstruct, delay or affect interstate commerce by robbery, and is used by United States Attorney Wigginton as a way to combat armed robbery in the Southern District of Illinois.
Documents filed in Court establish that on July 12, 2013 Reynolds drove her two co-defendants, Timothy Collier and Roderick Taylor, to Arena Liquor located at 105 S. Belt E, Belleville, Illinois, to commit a robbery. While Reynolds waited in her vehicle, Collier and Taylor entered Arena Liquor, each armed with a firearm. Collier and Taylor pointed the two firearms at an employee of Arena Liquor and another individual in the store and demanded all of the money from the cash registers as well as personal belongings from the two individuals. Collier and Taylor left the liquor store with approximately $15,000 of United States Currency, entered Reynolds’ vehicle, and the three fled from the scene. Reynolds was identified and apprehended a short time after the robbery and interviewed by law enforcement. During the interview, Reynolds admitted to her involvement in the planning and participation in the armed robbery.
Reynolds faces a term of imprisonment of up to 20 years, a fine of up to $250,000, and a term of supervised release of up to 3 years on the Hobbs Act violations. On the count of Use of a Firearm During a Crime of Violence, Reynolds faces a term of imprisonment of not less than 7 years up to a maximum term of Life, consecutive to, meaning in addition to, any term of imprisonment imposed on the Hobbs Act violations. Sentencing is scheduled for October 17, 2014, in East St. Louis, Illinois.
This case was investigated by the Belleville Police Department and the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorney Ali Summers.
Former MPD Officer Sentenced to 18 Years in Prison for Sexually Abusing 11-Year-Old Girl-Victim Came Forward Years Later-Read the Press Release
WASHINGTON - Wendel Palmer, 46, a former officer with the Metropolitan Police Department (MPD), was sentenced today to 18 years in prison for sexually abusing a child on numerous occasions between 2004 and 2006, U.S. Attorney Ronald C. Machen Jr. announced.
A jury in the Superior Court of the District of Columbia found Palmer guilty in November 2013 of three counts of first-degree child sexual abuse with aggravating circumstances, two counts of second-degree child sexual abuse with aggravating circumstances, and two counts of enticing a child with aggravating circumstances. He was sentenced by the Honorable J. Herbert B. Dixon, Jr. Upon completion of his prison term, Palmer will be placed on 10 years of supervised release. During that 10-year period, he must register as a sex offender.
According to the government’s evidence, at the time of the offenses, Palmer was an MPD officer who was also the youth choir director at the Bethuel Temple Church of Christ Apostolic, Inc., in the 2400 block of Martin Luther King Avenue SE. The defendant’s family founded and operated the church. The victim’s family belonged to the church, and the victim was a member of the choir. The abuse began when the victim was 10 or 11 years old, and occurred at the defendant’s home in Maryland, at the church during breaks in choir rehearsals, and at other locations in the District of Columbia and in Maryland. The victim was afraid to report the abuse while it was occurring, in part because the defendant was a police officer. The victim reported the abuse in 2012, after she turned 18.
In announcing the sentence, U.S. Attorney Machen commended the work of the detectives from the Metropolitan Police Department’s Youth Division and Mobile Crime Division. He also expressed appreciation for the work of Victim/Witness Advocate Tracey Hawkins, Paralegal Specialists Jason Manuel and Kristy Penny, and the Litigation Support Staff. Lastly, he acknowledged the efforts of Assistant U.S. Attorneys Amy Zubrensky, who investigated, indicted and tried the case, and Sarah McClellan, who also investigated the case.
14-165Former Government Employee Pleads Guilty to Accessing Government Website Servers Without AuthorizationRead the Press Release
ALEXANDRIA, Va. – Sathish Kumar Chandhun Rajendran, 36, of Sterling, Virginia, pleaded guilty yesterday to engaging in unauthorized access to government servers that hosted a Fannie Mae website used to support federal mortgage loan modification programs.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Michael P. Stephens, Acting Inspector General for the Federal Housing Finance Agency (FHFA-OIG); and Christy Romero, Special Inspector General for the Troubled Asset Relief Program (SIGTARP), made the announcement after the plea was accepted by U.S. District Judge T.S. Ellis, III.Rajendran pleaded guilty to a one-count criminal information charging him with unauthorized access to a protected computer causing damage. Rajendran faces a maximum penalty of five years in prison when he is sentenced on October 3, 2014. In the plea agreement, Rajendran also agreed, for a period of three years following his conviction, to refrain from participating as an employee, contractor or subcontractor in any government contract requiring clearance.
According to a statement of facts filed with the plea agreement, Rajendran worked at Fannie Mae as an Information Technology term employee and was assigned to the development of the CheckMyNPV.com website. This website was established under the Dodd-Frank Wall Street Reform and Consumer Protection Act by the Department of the Treasury and the Department of Housing and Urban Development in conjunction with the government’s Making Home Affordable (MHA) Program. The online tool on this website, operated by Fannie Mae under the auspices of the MHA, allowed citizens to determine the net present value of their homes and check their eligibility to participate in the Home Affordable Modification Program (HAMP), a federal program designed to avoid mass foreclosures.
After being terminated from employment in August 2013, Rajendran repeatedly used administrator credentials to log into government servers and make unauthorized changes to the CheckMyNPV website, including disabling the website’s online tool for checking HAMP eligibility. As a result of these actions, Rajendran caused damage and loss to the website in the amount of $30,000 to $70,000.
This case was investigated by the FHFA-OIG and SIGTARP. Assistant U.S. Attorney Alexander T.H. Nguyen is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:14-cr-233.Tweet
Former CalPERS CEO Pleads Guilty to Corruption ConspiracyRead the Press Release
SAN FRANCISCO – Fred Buenrostro pleaded guilty today to conspiracy to commit corruption and fraud charges stemming from a conspiracy to trade official acts for cash and benefits, announced U.S. Attorney Melinda Haag, U.S. Postal Inspection Service, Inspector in Charge Rafael E. Nunez, FBI Special Agent in Charge David J. Johnson, and U.S. Secret Service Special Agent in Charge Andrew Adelmann.
Buenrostro is the former Chief Executive Officer (CEO) of the California Public Employee Retirement System (CalPERS). In pleading guilty, Buenrostro admitted to conspiring with Alfred J. Villalobos, founder and operator of ARVCO Capital Research LLC (ARVCO). Buenrostro acknowledged in court today that he understood that Villalobos operated ARVCO as a placement agent that solicited investments by public pension funds into private equity funds. Buenrostro also admitted that he understood that ARVCO was typically paid an agreed-upon fee based on the percentage of the total dollar amount invested by the public pension fund.
In pleading guilty, Buenrostro admitted that he began receiving secret benefits from Villalobos no later than 2005 for the purpose of influencing him in the exercise of his powers and duties as CalPERS CEO. Buenrostro admitted Villalobos provided him approximately $250,000, as well as gifts, domestic and international travel, meals, entertainment, payment for Buenrostro’s wedding, and his subsequent employment at ARVCO after he left CalPERS in May of 2008. In exchange, Buenrostro admitted that he attempted to influence the CalPERS investment staff and Board to the benefit of Villalobos and his current and prospective clients, and provided Villalobos with access to CalPERS’ confidential information relating to investments, internal deliberations, and other proprietary matters.
As part of the conspiracy, Buenrostro admitted that he and Villalobos created fraudulent documents in order to secure fees for ARVCO from Apollo Global Management (Apollo), a private equity firm based in New York City. Villalobos, through ARVCO, was the placement agent through which Apollo secured $3 billion in investments by CalPERS. In 2007, Apollo informed ARVCO that it required signed Investor Disclosure letters from CalPERS prior to paying ARVCO any fees for its efforts in securing CalPERS' investments into Apollo-managed funds, citing, among other reasons, Apollo's obligations under the securities laws.
Buenrostro admitted that after CalPERS' legal and investment offices declined to sign the first Investor Disclosure letter documenting ARVCO's relationship with Apollo, Villalobos and Buenrostro conspired to create a series of fraudulent Investor Disclosure letters that were transmitted to Apollo. Apollo paid ARVCO a total of approximately $14 million dollars in fees after receiving the fraudulent letters.
When civil and later criminal investigations were opened into the operations of ARVCO and its role as a placement agent in connection with CalPERS' investments in Apollo-managed funds, Buenrostro admitted that he and Villalobos agreed on a false version of facts and subsequently made misrepresentations to, and concealed information from, the SEC, the USPIS, and the FBI, about their financial relationship and the authenticity of the Investor Disclosure letters in order to defeat and obstruct the lawful functions of those federal agencies.
Buenrostro was charged by superseding information with a single count of conspiracy, in violation of Title 18, United States Code, Section 371, and pleaded guilty before the Honorable Charles Breyer, United States District Court Judge, to that charge in an agreement with the government that included his promise to cooperate in future investigations. Villalobos is charged in a related Indictment, also before Judge Breyer, and previously entered a plea of not guilty to all charges. Both defendants are currently released on bond.
Buenrostro is scheduled for sentencing on Jan. 7, 2015, at 10:00 a.m., before Judge Breyer. The maximum statutory penalty for conspiracy to commit offenses against the United States is five years of imprisonment, $250,000 fine or twice the amount of gain or loss, whichever is greater, three years of supervised release, and a $100 special assessment. Restitution may also be ordered. However, any sentence following conviction will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
The court set a status hearing for Villalobos to take place on Friday, Aug. 8, 2014 at 9:00 a.m., before Judge Breyer in San Francisco.
Timothy J. Lucey and Philip A. Guentert are the Assistant United States Attorneys who are prosecuting the case with the assistance of Laurie Worthen and Beth Margen. The prosecution is the result of an investigation by the USPIS and the FBI, with substantial assistance from the Los Angeles Regional Office of the SEC as well as the U.S. Secret Service.
Please note, an Indictment contains only allegations and, as with all defendants, Alfred J. Villalobos must be presumed innocent unless and until proven guilty.
(Buenrostro superseding indictment )
(Buenrostro plea agreement )
Former Army Private and South Carolina Resident Pleads Guilty to Armed RobberyRead the Press Release
Case is one of many brought as a result of United States Attorney Stephen R. Wigginton’s Metro-East Armed Robbery Initiative
Follow @SDILNewsStephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today that on July 11, 2014, Denzell D. Grant, 19, a resident of South Carolina who was an Army Private stationed at Fort Hood, Texas, at the time of the commission of the offense, pled guilty to a two-count Indictment charging him, in Count 1, with Interference with Commerce by Robbery (Armed Robbery), and, in Count 2, with Possession of a Firearm in Furtherance of a Crime of Violence. The Armed Robbery count is a federal “Hobbs Act Robbery.” The Hobbs Act makes it a crime to obstruct, delay, or affect interstate commerce by robbery, and is used by United States Attorney Wigginton as a way to combat armed robbery in the Southern District of Illinois.
Grant faces a term of imprisonment of not more than twenty (20) years, a fine up to $250,000, or both, and a term of supervised release of not more than three (3) years on Count 1. On Count 2, Grant faces a term of imprisonment of not less than ten (10) years in prison, and that term must run consecutively (in addition) to any sentence imposed on Count 1, a fine up to $250,000, and a term of supervised release of not more than five (5) years. Sentencing is scheduled for October 24, 2014, in East St. Louis, Illinois. Grant has been held without bond since his initial appearance on February 27, 2014.
The offense occurred on October 13, 2013, when Grant, an Army private visiting Swansea with a friend, decided, with others, to rob Max’s One Stop in Swansea. Grant, wearing a mask and armed with a loaded gun, entered Max’s One Stop, and jumped over the counter which led to the area where the lone clerk, R.B., was sitting. Grant put the gun to R.B.’s head and told R.B. to give Grant all of the money. Grant held the gun on R.B. as Grant followed R.B. to the cash register. As R.B. was giving Grant the cash from the register, R.B. grabbed the gun and the two began struggling over the gun. During the struggle, the firearm discharged, injuring R.B.’s left hand and striking Grant in the right arm.
After being shot, Grant tried to escape by jumping over the counter into the customer area. At the same time, a customer who knew R.B. walked into the convenience store and heard R.B. call for help. The customer helped prevent Grant from escaping until the police arrived.
The victim, R.B., spoke at Grant’s change of plea hearing, stating that Grant told him that he (Grant) was going to kill R.B. R.B. said that he thought of his newborn child and began to wrestle with Grant over the gun. R.B. also informed the Court of the emotional consequences of the robbery, stating that, after a while, he could no longer work at Max’s because he (R.B.) would be scared every time the door to the store opened. Finally, R.B., looking directly at Grant, told Grant, “You’re in the Army. Your job is to protect us, not to kill us.”
The case was investigated by the Swansea Police Department, the Illinois State Police Crime Scene Investigation Unit, and the Federal Bureau of Investigation. The case is assigned to Assistant United States Attorney Angela Scott.
Emerson Man Sentenced for Manufacturing Child PornographyRead the Press Release
Matthew C. Steging, age 42 of Emerson, Nebraska, was sentenced in United States District Court in Omaha, Nebraska, for producing child pornography. The Honorable Joseph F. Bataillon sentenced Steging to a fifteen year term of imprisonment. There is no parole in the federal prison system. After his release from prison Steging will begin a fifteen year term of supervised release. He will also be required to register as a sex offender.
On August 26, 2013, a search warrant was executed at Steging’s residence in Emerson. Agents were seeking evidence related to the manufacture and possession of child pornography. Forensic analysis located 10 movie clips. The movies were filmed at the residence. The movies depicted a sleeping ten year old girl being sexually abused. The abuse continued at various points throughout the evening and into the next morning. No faces were depicted in the videos. Steging was identified by a distinctive tattoo on his hand.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
East St. Louis Man Sentenced for Making A False Statement During the Purchase of A FirearmRead the Press Release
Follow @SDILNewsStephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today that on July 11, 2014, Mack Davis, Jr., 23, was sentenced in federal district court, in East St. Louis, Illinois. The Honorable Judge David R. Herndon sentenced Davis to a term of 30 months in federal prison, to be followed by a three-year term of supervised release. Davis was also fined $250 and was ordered to pay a $100 special assessment.
On February 19, 2013, Davis pled guilty to a felony, residential burglary, in state court, in St. Clair County, Illinois. After receiving probation for his crime, he immediately went to a firearms store and attempted to purchase two firearms. Davis filled out a Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Form 4473, which firearms purchasers are required to complete by law. The ATF Form 4473 is necessary in order to keep firearms out of the hands of prohibited individuals. Davis lied on the ATF Form 4473 stating that he was not a felon, when in fact he was.
This case was investigated by the ATF and prosecuted by Special Assistant United States Attorney Neal C. Hong.
Duval County Man Pleads Guilty to Aiding and Abetting Counterfeit Check FraudRead the Press Release
Jacksonville, Florida – United States Attorney A. Lee Bentley, III announces that Terrance Smith (39, Jacksonville) today pleaded guilty to two counts of aiding and abetting the passing or attempted passing of counterfeit checks. He faces a maximum penalty of 25 years in federal prison on each count. Smith is also on federal supervised release for conspiracy to pass fictitious financial instruments. He faces up to 2 years in federal prison for the supervised release violation.
According to the plea agreement, in or about October 2013, Terrance Smith and others began distributing counterfeit business checks that used the business checking account number of a church located in Jacksonville. After locating various individuals to pass the counterfeit business checks, Smith would then provide transportation to the individuals for the purpose of passing the counterfeit checks. Upon arriving at a business that cashed checks, Smith or his co-defendant, Shameka Robinson, would give the counterfeit check to the passer. Smith would come back to the business, or a predetermined location near the business, and pick up the passer. The passer would hand the money directly to Smith or to Robinson. Smith would pay each passer whom successfully cashed a counterfeit check.
On November 13, 2013, law enforcement officers set up surveillance in a trailer park based on credible information that an individual, ultimately identified as Smith, would be coming there to pick up individuals for the purpose of passing counterfeit checks. Smith and Robinson subsequently drove into the trailer park in order to pick up individuals. Upon entering the park, Smith observed law enforcement and began turning in order to exit. As he left the area, Smith began tearing up counterfeit checks. Law enforcement conducted a lawful investigative stop on Smith's vehicle and observed an open plastic grocery bag containing counterfeit check stubs purportedly from payroll checks. Officers also located counterfeit check stubs and torn up counterfeit checks inside the vehicle. Inside of Robinson’s purse, officers located additional counterfeit business checks.
In total, law enforcement officials connected Smith and Robinson to twenty-five counterfeit business checks passed or attempted to be passed in Jacksonville. Robinson pleaded guilty on July 1, 2014 to aiding and abetting the passing or attempted passing of counterfeit checks. She is scheduled to be sentenced on September 30, 2014. Robinson faces a maximum penalty of 25 years in federal prison.
This case was investigated by the North Florida Financial Crimes Task Force, the United States Secret Service, and the Jacksonville Sheriff’s Office. It is being prosecuted by Assistant United States Attorney Kevin C. Frein.
District Man Sentenced to Eight Years in Prison for Beating and Robbing A Man in Early Evening Attack-Defendant Stole Victim’s IPhone, Wallet and Keys-Read the Press Release
WASHINGTON – Marvin Jefferson, 25, of Washington, D.C., was sentenced today to an eight-year prison term on charges of aggravated assault while armed, armed robbery, and related firearms offenses for attacking a man in Northeast Washington, U.S. Attorney Ronald C. Machen Jr. announced.
Jefferson was found guilty by a jury in April 2014, following a trial in the Superior Court of the District of Columbia. He was sentenced by the Honorable Michael Ryan. Upon completion of his prison term, Jefferson will be placed on five years of supervised release.
According to the government’s evidence, in the early evening hours of Oct. 28, 2013, Jefferson attacked a man he had just encountered at a liquor store in the 1300 block of North Capitol Street NE. The victim, a 24-year-old engineering graduate of Howard University, had stopped at the store to get a beer. Jefferson, also inside the store, tried to take the victim’s iPhone. The victim put his iPhone in his jacket pocket, paid for his beer, and left the store.
Jefferson, however, followed the victim to the street. He tried to reach into the victim’s jacket to get the iPhone, and when the victim turned around, Jefferson began striking him. Jefferson hit the victim in the forehead with what appeared to be a gun, causing lacerations. Then, while the victim was in a disoriented and semi-conscious state, Jefferson robbed him of his phone, wallet and keys. The victim lost consciousness and dropped to the ground, chipping his tooth. Once he regained consciousness, he flagged down two police officers. A few days after the attack, he was able to identify Jefferson as his attacker.
In announcing the sentence, U.S. Attorney Machen commended the work of those who investigated the case from the Metropolitan Police Department (MPD). He also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Victim/Witness Services Coordinator La June Thames; Victim/Witness Advocate Jennifer Clark; Paralegal Specialist Donville Drummond, and Assistant U.S. Attorney John Mannarino. Finally, he expressed appreciation for the work of Assistant U.S. Attorneys Clayton O’Connor, who secured the indictment, and John P. Fucetola, who prosecuted the case.
14-164District Man Sentenced to 21-Year Prison Term for Series of Attacks Against Young WomenIncidents Took Place over Four-Week Period in Northeast WashingtonRead the Press Release
WASHINGTON - Gerald Canty, 21, of Washington, D.C., was sentenced today to 21 years in prison for sexually assaulting an 18-year-old woman and attempting to kidnap three additional young women in a series of incidents that took place earlier this year in Northeast Washington, U.S. Attorney Ronald C. Machen Jr. announced.
Canty pled guilty on May 16, 2014, in the Superior Court of the District of Columbia, to one count of first-degree sexual abuse, one count of attempted kidnapping while armed, and two counts of attempted kidnapping. He was sentenced by the Honorable Jennifer Anderson. Upon completion of his prison term, Canty will be placed on supervised release for the rest of his life. He also must register as a sex offender for the rest of his life and stay away from minors.
According to the government’s evidence, on March 1, 2014, at about 10:40 a.m., the 18-year-old woman was walking on the footbridge from the Minnesota Avenue Metro station when Canty approached her from behind. Canty told her that he had a gun and forced her to walk several blocks with him to an isolated field. When they got there, he sexually assaulted her. After the assault, she immediately went home and told her mother what happened. She reported the assault to the Metropolitan Police Department (MPD), and was taken to a local hospital, where she received a sexual assault exam.
On March 5, 2014, at about 11:30 a.m., another victim - a 25-year-old woman - was walking in the area of 44th and Hayes Streets NE, about half a mile from the Metro station, when Canty approached her. He had his hand in his pocket to simulate that he had a gun. He bumped into her, grabbed her arm, and stated, “Where’s the money at?” He then forced her to walk with him while demanding money. The victim saw what she believed to be the handle of a handgun in the defendant’s pocket. Canty forcibly led her towards an alley behind a residence in the next block. She managed to break away and yell for help. An unidentified bystander came to her aid, and Canty fled on foot. The victim reported the assault to MPD immediately.
On March 7, 2014, at about 7:05 a.m., a third victim – a 17-year-old - was walking on the footbridge from the Minnesota Avenue Metro station, toward her school. Canty walked up beside her with his hand in his pocket to simulate that he had a gun, and stated, “I real life have a gun in my pocket and I’ll shoot you. Just keep walking straight. Don’t draw any attention to yourself. Don’t do anything crazy.” He forced her to walk with him a short distance. She saw an acquaintance and then stopped walking with Canty, who fled on foot. She then reported the assault to her school principal, and later to MPD.
All three victims provided MPD detectives with descriptions of the assailant. On March 13, 2014, the Minnesota Avenue Metro station manager contacted Metro Transit Police to report that an individual matching the descriptions had been seen on the footbridge of the Minnesota Avenue Metro station. Metro Transit and MPD officers stopped the defendant. Detectives with MPD’s Sexual Assault Unit responded and spoke to Canty. He subsequently admitted to sexually assaulting the 18-year-old and attempting to kidnap the 25-year-old and 17-year-old victims. The sexual assault kit from the 18-year-old’s examination was later tested, and showed that a single male DNA profile was found that matched Canty’s DNA profile.
After Canty was charged in the above crimes, MPD detectives linked an additional case to him. In that offense, on Feb. 17, 2014, at approximately 5:45 p.m., a 19-year-old woman was walking through a cut near 51st Street NE when Canty approached her from behind. He stated that he had a gun in his pocket, and threatened to shoot her if she yelled or screamed. Canty told her to keep walking, which she did. She saw an acquaintance walk into a house, and ran to follow that person inside. She told the occupants what had just occurred. Several occupants went outside, but Canty was gone. This victim later identified the defendant as her attacker.
In announcing the sentence, U.S. Attorney Machen commended the work of the detectives from the Metropolitan Police Department=s Sexual Assault Unit, Youth Investigations Division, Sixth District, and Mobile Crime Division. He also acknowledged the work of the District of Columbia Department of Forensic Sciences, Metro Transit Police, and Washington Metro Area Transit Authority. He also praised those who handled the case for the U.S. Attorney’s Office, including Victim/Witness Advocate Tracey Hawkins, Paralegal Specialist Jason Manuel, and Assistant U.S. Attorney Amy Zubrensky, who investigated and prosecuted the case.
14-162District Man Found Guilty of First-Degree Murder While Armed in 2012 Shooting in Southeast Washington-Defendant Shot Victim After Arguing with Him Earlier on Street-Read the Press Release
WASHINGTON – David Shepherd, 50, of Washington, D.C., was found guilty by a jury today of first-degree murder while armed in the June 2012 killing of a man in Southeast Washington, U.S. Attorney Ronald C. Machen Jr. announced.
The verdict followed a trial in the Superior Court of the District of Columbia. The jury also found Shepherd guilty of charges of fleeing police, destruction of property, and related firearms offenses. The Honorable Russell F. Canan scheduled sentencing for Oct. 3, 2014.
According to the government’s evidence, in the early morning hours of June 3, 2012, Shepherd and the victim, Henry Miller, 32, encountered one another while at a house in the 1100 block of Chicago Street SE. Shepherd was outside and in a conversation with mutual friends of the two men when Mr. Miller approached and said “Excuse me,” to Shepherd and tried to reach for a cigarette inside the friends’ vehicle. Shepherd responded aggressively and began swearing and raising his voice. A verbal argument ensued, in which Shepherd threatened Mr. Miller. Others stepped in to defuse the situation, and the argument ended when Shepherd indicated he was leaving and walked toward his nearby truck.
Shepherd, however, then returned to the scene, walked up to Mr. Miller, within arm’s reach, and shot him in the face with a revolver. He then got into his truck and fled the scene.
The Metropolitan Police Department (MPD) quickly responded to the shooting and got a description of Shepherd and his truck. Officers in the area observed him driving and attempted to make a traffic stop, but Shepherd then engaged the police in a high-speed chase throughout the city, plowing through a gate a Gallaudet University, and then crashed his truck on Brentwood Parkway NE. MPD officers then apprehended Shepherd and recovered the murder weapon in his vehicle.
In announcing the verdict, U.S. Attorney Machen commended the work of those who investigated the case for the Metropolitan Police Department. He also expressed appreciation for the assistance provided by the District of Columbia Department of Forensic Sciences. He acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialists Kwasi Fields and Kendra Johnson; former Paralegal Specialist Marian Russell; Information Technology Specialist Jeanie Latimore Brown; and Interns Megan Benevento and Kimberly Knipe. Finally, he praised the work of Assistant U.S. Attorney Lara Worm, who prosecuted the case.
14-166Department of Justice Provides Update on Gameover Zeus and Cryptolocker DisruptionRead the Press Release
The Justice Department today filed a status report with the United States District Court for the Western District of Pennsylvania updating the court on the progress in disrupting the Gameover Zeus botnet and the malicious software known as Cryptolocker. The disruption began in late May, when the Justice Department implemented a series of Court-authorized measures to neutralize Gameover Zeus and Cryptolocker - two of the most sophisticated and destructive forms of malicious software in existence.
In the status report, the Justice Department informed the Court that the technical and legal measures undertaken to disrupt Gameover Zeus and Cryptolocker have proven successful, and that significant progress has been made in remediating computers infected with Gameover Zeus.
The Justice Department reported that all or nearly all of the active computers infected with Gameover Zeus have been liberated from the criminals’ control and are now communicating exclusively with the substitute server established pursuant to court order. The Justice Department also reported that traffic data from the substitute server shows that remediation efforts by internet service providers and victims have reduced the number of computers infected with Gameover Zeus by 31 percent since the disruption commenced.
The Justice Department also reported that Cryptolocker has been neutralized by the disruption and cannot communicate with the infrastructure used to control the malicious software. As a result, Cryptolocker is effectively non-functional and unable to encrypt newly infected computers.
Computer users who believe they may be infected with Gameover Zeus are encouraged to visit the Department of Homeland Security’s dedicated Gameover Zeus webpage, which is located at www.us-cert.gov/gameoverzeus . Among other resources, the webpage includes links to tools from trusted vendors that can detect and remove the Gameover Zeus infection.Related Materials:
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Declaration in Support of MotionDefendant Pleads Guilty to Conspiring to Provide Material Support to Al-Qa’ida, Al-Qa’ida in Iraq/Al-Nusrah Front, and Al-ShabaabRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, John P. Carlin, Assistant Attorney General for National Security, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and the members of the South Florida Joint Terrorism Task Force (JTTF), announce that Gufran Ahmed Kauser Mohammed, 31, a naturalized United States citizen and resident of Dammam, Saudi Arabia, pled guilty to one count of conspiring to provide material support to designated Foreign Terrorist Organizations al-Qa’ida, al-Qa’ida in Iraq/al-Nusrah Front (“AQI/al-Nusrah Front”), and al-Shabaab. Sentencing for Mohammed is scheduled for October 24, 2014, before U.S. District Judge Ursula Ungaro.
Mohammed was charged along with Mohamed Hussein Said in a fifteen-count indictment with conspiring to provide, and attempting to provide, material support to three separately designated Foreign Terrorist Organizations, al-Qa’ida, AQI/al-Nusrah Front, and al-Shabaab. Mohammed faces a possible statutory maximum sentence of up to 15 years in prison.
The indictment alleges that Mohammed and Said conspired to provide money and recruits to al-Qa’ida, AQI/al-Nusrah Front in Syria, and al-Shabaab in Somalia. The charges allege that Mohammed sent a series of wire transfers to Said for the purpose of supporting al-Shabaab, and to an individual whom he believed was a fundraiser, recruiter, and supplier for al-Qa’ida and AQI/al-Nusrah Front for the purpose of supporting al-Qa’ida and AQI/al-Nusrah Front. In addition, Mohammed and Said agreed to support al-Qa’ida and AQI/al-Nusrah Front by recruiting and moving experienced al-Shabaab fighters to the conflict in Syria.
Mr. Ferrer commended the investigative efforts of the FBI and the South Florida Joint Terrorism Task Force. The case is being prosecuted by Assistant U.S. Attorneys Brian Frazier and Ricardo Del Toro and Trial Attorney Jolie Zimmerman from the Counterterrorism Section of the Justice Department’s National Security Division.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Danbury Man Involved in Home Invasion Drug Robberies Is SentencedRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that JORDANO PERDOMO, 20, of Danbury, was sentenced today by U.S. District Judge Stefan R. Underhill in Bridgeport to 30 months of imprisonment, followed by three years of supervised release, for his participation in two Danbury-area violent home invasion robberies of illegal drugs and drug trafficking proceeds.
According to court documents and statements made in court, in January 2013 the Danbury Police Department began investigating a narcotics trafficking network that maintained a series of drug distribution locations, known as trap houses, in Danbury, out of which members of the organization sold crack and heroin. The organization also rented hotel rooms where they packaged and distributed narcotics. During the investigation, law enforcement learned that the individuals who headed the drug trafficking ring had organized and committed armed home invasion robberies of marijuana dealers.
PERDOMO participated in home invasion robberies on January 30 and February 14, 2013. During both of these robberies, and a third in which PERDOMO did not participate, several men wearing masks and armed with firearms forced entry into the residence of a known marijuana dealer. Once inside, the perpetrators attempted to or did steal marijuana and cash. In each instance, the perpetrators pistol whipped a victim and threatened to kill others within the home.
PERDOMO brandished a BB gun during both of the robberies in which he participated. During the robbery on February 14, PERDOMO held a woman at gunpoint in her bedroom and threatened to harm her if she called the police.
PERDOMO has been detained since his arrest on October 23, 2013. On March 20, 2014, he pleaded guilty to one count of interference with commerce by robbery and one count of attempted interference with commerce by robbery.
The U.S. Attorney’s Office advocated for a sentence within the federal sentencing guidelines range of 70 to 87 months of imprisonment.
This matter is being investigated by the Drug Enforcement Administration’s New Haven Task Force and the Danbury Police Department. The DEA Task Force includes personnel from the New Haven, Hamden, West Haven, North Haven, Branford, Ansonia and Meriden Police Departments. The case is being prosecuted by Assistant U.S. Attorneys Tracy Dayton and Vanessa Richards.
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[email protected]Court Prohibits South Carolina Tax Return Preparer from Preparing Returns for OthersRead the Press Release
Contact Person: George Conits (864) 282-2100
Tax Preparer Filed Returns for Others that Overstated Tax Refunds by Claiming Fabricated IRA Deductions and Bogus Education Credits
Columbia, South Carolina -----United States District Court Judge Mary Geiger Lewis, in Spartanburg, South Carolina, permanently barred Sandra Burton from preparing federal income tax returns for others, the U.S. Attorney Bill Nettles announced today.
According to the complaint, from 2006 through 2008, Burton operated her own tax preparation business, Burton Tax Service, and then worked as a tax preparer at J. Moss Financial Services through 2012. While operating Burton Tax Service in 2007 and 2008, Burton allegedly prepared returns for others that improperly claimed fabricated IRA deductions and bogus education credits to reduce her customers’ tax liabilities and/or increase the size of their refunds. The complaint further alleges that Burton closed her tax preparation business after the Internal Revenue Service (IRS) executed a search warrant on her business in 2008.
According to the complaint, even after closing Burton Tax Service, Burton continued to prepare returns for others. As alleged, Burton prepared over 1500 returns in 2011 and 2012 as a tax preparer at J. Moss Financial Services. The complaint further alleges that Burton continued to claim unsubstantiated education credits on returns she prepared while employed at J. Moss Financial Services.
In December 2012, Burton pleaded guilty to ten counts of willfully aiding and assisting in the preparation and presentation of materially false income tax returns for returns she prepared while operating Burton Tax Service. Burton was sentenced to serve 21 months in federal prison and ordered to pay $355,529 in restitution to the IRS.
Burton consented to entry of the injunction.
Return preparer fraud is one of the IRS' Dirty Dozen Tax Scams for 2014. The IRS has some tips on their website for choosing a tax preparer. In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.Congressional Candidate Sentenced for Violating the Federal Election Campaign ActRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Leslie R. Caldwell, Assistant Attorney General for the Criminal Division of the Department of Justice, and George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, announce that Justin Lamar Sternad, 35, of Miami, was sentenced to seven months in prison by U.S. District Court Judge Cecilia M. Altonaga for violating the Federal Election Campaign Act (Election Act) in connection with the 2012 Democratic Party primary election for Florida’s 26th Congressional District.
Sternad previously pled guilty to all counts of a criminal information that charged him with one count of conspiracy to make false statements to the Federal Election Commission (FEC), one count of making false statements to the FEC and one count of accepting illegal campaign contributions.
Sternad was a candidate in the 2012 Democratic Party primary election for Florida’s 26th Congressional District. According to court documents, Sternad engaged in a conspiracy to accept illegal, direct and coordinated campaign contributions and file false statements with the FEC in order to conceal the true source, amount and nature of the funds used by his campaign.
Sternad admitted that his campaign accepted cash and checks in excess of Federal Election Campaign Act limits, and that he filed statements that intentionally misled the FEC about his campaign’s activities. During the campaign, illegal cash contributions from co-conspirators were used to pay for a rental car and the design, printing and distribution of campaign flyers.
According to court documents, Sternad reported to the FEC that he made loans to his campaign in the amount of $63,801, when he knew that he had actually loaned fewer than $300. In total, Sternad accepted over $70,000 in misreported campaign contributions.
Mr. Ferrer commended the investigative efforts of the FBI. The case is being prosecuted by Senior Litigation Counsel Thomas J. Mulvihill and Richard C. Pilger, Director of the Election Crimes Branch of the Public Integrity Section of the Criminal Division of the U.S. Department of Justice.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Columbia Felon Sentenced to Three Years for Carrying Pistols While Out on BondRead the Press Release
Contact Person: Jim May (803) 929-3000
Columbia, South Carolina -----United States Attorney Bill Nettles stated that Raheem Fitzgerald Bethel, age 27, of Columbia, was sentenced today in federal court in Columbia, South Carolina, to a term of imprisonment of 35 months in federal prison. On January 15, 2013, Bethel, a previously convicted felon who was on bond for attempted murder, was arrested by the Columbia Police Department with two pistols, one of which was stolen. After being released again on bond, Bethel was arrested on September 14, 2013 in possession of another stolen pistol. A federal Grand Jury subsequently indicted Bethel on February 5, 2014. Senior United States District Judge Margaret B. Seymour sentenced Bethel to 35 months in prison.
This prosecution is part of the United States Attorney’s ongoing efforts with the Columbia Police Department and the Bureau of Alcohol, Tobacco, Firearms, and Explosives to identify and prosecute violent felons who possess firearms.
The case was prosecuted by Assistant United States Attorney Jay N. Richardson.Carrick Woman with Six Felony Drug Convictions to Spend 15 Years in Prison for Illegally Possessing Loaded PistolRead the Press Release
PITTSBURGH - A resident of Pittsburgh, Pennsylvania, was sentenced in federal court on Thursday, July 10, 2014, to 180 months imprisonment followed by five years supervised release on her conviction of violating federal firearms and narcotics laws, United States Attorney David J. Hickton announced today.
Senior United States District Judge Maurice B. Cohill imposed the sentence on Tamika Somerville, 34.
According to information presented to the court, on or about May 12, 2012, Somerville, being a convicted felon, illegally possessed a Glock, Model 27, .40 caliber pistol loaded with twelve rounds of ammunition. Attached to the pistol was a laser sight. Federal law prohibits anyone who has been convicted of a crime punishable by a term of imprisonment exceeding one year to possess a firearm. Somerville is a convicted felon as a result of six previous felony drug trafficking convictions from the Court of Common Pleas of Allegheny County. Somerville was also found in possession of 150 stamp bags of heroin which she possessed with the intent to distribute.
Assistant United States Attorney Charles A. Eberle prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Pittsburgh Bureau of Police and the Drug Enforcement Administration for the investigation leading to the successful prosecution of Somerville. This case was prosecuted under Project Safe Neighborhoods, a collaborative effort by federal, state and local law enforcement agencies, prosecutors and communities to prevent, deter and prosecute gun crime.
Caribbean-Based Investment Advisors and Attorney Plead Guilty to Using Offshore Accounts to Launder and Conceal FundsRead the Press Release
Joshua Vandyk, a U.S. citizen, and Eric St-Cyr and Patrick Poulin, Canadian citizens, have each pleaded guilty to conspiring to launder monetary instruments, the Justice Department and Internal Revenue Service (IRS) announced today.
Patrick Poulin, 41, pleaded guilty today, Vandyk, 34, pleaded guilty on June 12, and St-Cyr, 50, pleaded guilty on June 27. The three defendants were indicted by a grand jury in the U.S. District Court for the Eastern District of Virginia on March 6, and the indictment was unsealed on March 12 after the defendants were arrested in Miami.
According to the plea agreements and statements of facts, Vandyk, St-Cyr and Poulin conspired to conceal and disguise the nature, location, source, ownership and control of property believed to be the proceeds of bank fraud, specifically $2 million. Vandyk, St-Cyr and Poulin assisted undercover law enforcement agents posing as U.S. clients in laundering purported criminal proceeds through an offshore structure designed to conceal the true identity of the proceeds’ owners. Vandyk and St-Cyr invested the laundered funds on the clients’ behalf and represented that the funds would not be reported to the U.S. government.
“This investigation highlights the Justice Department’s commitment to worldwide enforcement of federal laws designed to ensure that U.S. taxpayers fully disclose and report all foreign income and assets,” said Deputy Assistant Attorney General Ronald A. Cimino of the Justice Department's Tax Division. “ The Tax Division is committed to using every tool available to hold these wrongdoers accountable .”
“These three defendants played a shell game by creating offshore entities designed to help their U.S. clients evade taxes and other legal requirements, and they used that same shell game to launder purported criminal proceeds,” said U.S. Attorney Dana J. Boente for the Eastern District of Virginia. “We are committed to working with our law enforcement partners to penetrate and combat these schemes wherever they occur.”
“Individuals who assist others in laundering criminal proceeds will be held accountable for their own criminal actions,” said IRS-Criminal Investigation Chief Richard Weber. “The defendants in this investigation had a blatant disrespect for the laws and laundered purported criminal proceeds through offshore structures to conceal the identity of the proceeds’ owners. IRS Criminal Investigation has ramped up its presence in the international arena and will aggressively pursue those who commit financial crimes.”
According to court documents, Vandyk and St-Cyr lived in the Cayman Islands and worked for an investment firm based in the Cayman Islands. St-Cyr was the founder and head of the investment firm, whose clientele included numerous U.S. citizens. Poulin, an attorney at a law firm based in Turks and Caicos, worked and resided in Canada as well as the Turks and Caicos. His clientele also included numerous U.S. citizens. Vandyk, St-Cyr and Poulin solicited U.S. citizens to use their services to hide assets from the U.S. government, including the IRS. Vandyk and St-Cyr directed the undercover agents posing as U.S. clients to create an offshore corporation with the assistance of Poulin and others because they and the investment firm did not want to appear to deal with U.S. clients. Vandyk, St-Cyr and Poulin used the offshore entity to move money into the Cayman Islands and used Poulin as a nominee intermediary for the transactions.
According to court documents, Poulin established an offshore corporation called Zero Exposure Inc. for the undercover agents posing as U.S. clients and served as a nominal board member in lieu of the clients. Poulin transferred approximately $200,000 that Poulin, St-Cyr and Vandyk believed to be the proceeds of bank fraud from the offshore corporation to the Cayman Islands, where Vandyk and St-Cyr invested those funds outside of the United States in the name of the offshore corporation. The investment firm represented that it would neither disclose the investments or any investment gains to the U.S. government, nor would it provide monthly statements or other investment statements to the clients. Clients were able to monitor their investments online through the use of anonymous, numeric passcodes. Upon request from the U.S. client, Vandyk and St-Cyr liquidated investments and transfer money, through Poulin, back to the United States. According to Vandyk and St-Cyr, the investment firm would charge clients higher fees to launder criminal proceeds than to assist them in tax evasion.
The case was investigated by special agents of the IRS-Criminal Investigation. Trial Attorneys Todd Ellinwood and Caryn Finley of the department’s Tax Division and Assistant U.S. Attorney Kosta Stojilkovic of the U.S. Attorney’s Office for the Eastern District of Virginia are prosecuting the case. The Justice Department and the IRS would like to thank the Royal Canadian Mounted Police, the Royal Cayman Islands Police Service and the Royal Turks and Caicos Islands Police Force for their assistance in this investigation.
Additional information about the Tax Division and its enforcement efforts may be found at the division website .
Caribbean-Based Investment Advisors and Attorney Plead Guilty to Using Offshore Accounts to Launder and Conceal FundsRead the Press Release
WASHINGTON - Joshua Vandyk, a U.S. citizen, and Eric St-Cyr and Patrick Poulin, Canadian citizens, have each pleaded guilty to conspiring to launder monetary instruments, the Justice Department and Internal Revenue Service (IRS) announced today.
Patrick Poulin, 41, pleaded guilty today, Vandyk, 34, pleaded guilty on June 12, and St-Cyr, 50, pleaded guilty on June 27. The three defendants were indicted by a grand jury in the U.S. District Court for the Eastern District of Virginia on March 6, and the indictment was unsealed on March 12 after the defendants were arrested in Miami.
According to the plea agreements and statements of facts, Vandyk, St-Cyr and Poulin conspired to conceal and disguise the nature, location, source, ownership and control of property believed to be the proceeds of bank fraud, specifically $2 million. Vandyk, St-Cyr and Poulin assisted undercover law enforcement agents posing as U.S. clients in laundering purported criminal proceeds through an offshore structure designed to conceal the true identity of the proceeds’ owners. Vandyk and St-Cyr invested the laundered funds on the clients’ behalf and represented that the funds would not be reported to the U.S. government.
“This investigation highlights the Justice Department’s commitment to worldwide enforcement of federal laws designed to ensure that U.S. taxpayers fully disclose and report all foreign income and assets,” said Deputy Assistant Attorney General Ronald A. Cimino of the Justice Department's Tax Division. “The Tax Division is committed to using every tool available to hold these wrongdoers accountable.”
“These three defendants played a shell game by creating offshore entities designed to help their U.S. clients evade taxes and other legal requirements, and they used that same shell game to launder purported criminal proceeds,” said U.S. Attorney Dana J. Boente for the Eastern District of Virginia. “We are committed to working with our law enforcement partners to penetrate and combat these schemes wherever they occur.”
“Individuals who assist others in laundering criminal proceeds will be held accountable for their own criminal actions,” said IRS-Criminal Investigation Chief Richard Weber. “The defendants in this investigation had a blatant disrespect for the laws and laundered purported criminal proceeds through offshore structures to conceal the identity of the proceeds’ owners. IRS Criminal Investigation has ramped up its presence in the international arena and will aggressively pursue those who commit financial crimes.”
According to court documents, Vandyk and St-Cyr lived in the Cayman Islands and worked for an investment firm based in the Cayman Islands. St-Cyr was the founder and head of the investment firm, whose clientele included numerous U.S. citizens. Poulin, an attorney at a law firm based in Turks and Caicos, worked and resided in Canada as well as the Turks and Caicos. His clientele also included numerous U.S. citizens. Vandyk, St-Cyr and Poulin solicited U.S. citizens to use their services to hide assets from the U.S. government, including the IRS. Vandyk and St-Cyr directed the undercover agents posing as U.S. clients to create an offshore corporation with the assistance of Poulin and others because they and the investment firm did not want to appear to deal with U.S. clients. Vandyk, St-Cyr and Poulin used the offshore entity to move money into the Cayman Islands and used Poulin as a nominee intermediary for the transactions.
According to court documents, Poulin established an offshore corporation called Zero Exposure Inc. for the undercover agents posing as U.S. clients and served as a nominal board member in lieu of the clients. Poulin transferred approximately $200,000 that Poulin, St-Cyr and Vandyk believed to be the proceeds of bank fraud from the offshore corporation to the Cayman Islands, where Vandyk and St-Cyr invested those funds outside of the United States in the name of the offshore corporation. The investment firm represented that it would neither disclose the investments or any investment gains to the U.S. government, nor would it provide monthly statements or other investment statements to the clients. Clients were able to monitor their investments online through the use of anonymous, numeric passcodes. Upon request from the U.S. client, Vandyk and St-Cyr liquidated investments and transfer money, through Poulin, back to the United States. According to Vandyk and St-Cyr, the investment firm would charge clients higher fees to launder criminal proceeds than to assist them in tax evasion.
The case was investigated by special agents of the IRS-Criminal Investigation. Trial Attorneys Todd Ellinwood and Caryn Finley of the department’s Tax Division and Assistant U.S. Attorney Kosta Stojilkovic of the U.S. Attorney’s Office for the Eastern District of Virginia are prosecuting the case. The Justice Department and the IRS would like to thank the Royal Canadian Mounted Police, the Royal Cayman Islands Police Service and the Royal Turks and Caicos Islands Police Force for their assistance in this investigation.
Additional information about the Tax Division and its enforcement efforts may be found at the division website.Tweet
C.p. Buckner Steel Erection, Inc. Enters into $825,000 Settlement of Claims Related to Employment of Illegal AliensRead the Press Release
ALBANY, NEW YORK –C.P. Buckner Steel Erection Inc., (“Buckner”) of Graham, North Carolina has agreed to pay $825,000 in civil forfeiture over two years as part of a settlement in an investigation of its employment of illegal aliens announced United States Attorney Richard S. Hartunian and U.S. Immigration and Customs Enforcement, Homeland Security Investigations (HSI), Assistant Special Agent in Charge, Nicholas DiNicola. As part of the settlement agreement, if Buckner fully complies with the terms of the settlement agreement, the United States Attorney for the Northern District of New York agrees not to pursue corporate criminal charges against Buckner for its employment of illegal alien workers before March 31, 2009.
The government’s investigation documented that Buckner employed workers at projects who were not eligible to work. The investigation began in January 2009 following a tip that Buckner had transported illegal aliens from North Carolina to a Beech-Nut project in Montgomery County, New York. Regarding that project, on January 22, 2009 and February 18, 2009, HSI arrested a total of nine Buckner employees, including two supervisors, because they were unlawfully present in the United States. Six of those employees were released, and Buckner continued to employ them. In addition, after the first arrests, the employees moved from a hotel located within one mile of the project to one thirty miles away. This move was approved by Buckner.
On February 28, 2009, when auditors from the New York State Department of Labor (“DOL”) and the New York State Bureau of Criminal Investigation (“BCI”) appeared unannounced at the project to interview employees, all but one employee, who was also not authorized to work, fled. Those employees, as approved by Buckner, went to North Carolina and continued working for Buckner there despite the fact that they were not authorized to work. Until April 2009, Buckner failed to make further inquiry regarding the work authorization status of those employees who had fled and other employees in its workforce who Buckner had sponsored for green cards consciously avoiding the inferences that could be drawn from the combination of the Buckner’s sponsorship of the employees in the green card program, the crew’s action in the Northern District of New York, and HSI’s arrest of Buckner employees in 2008 and 2009. In addition, Buckner had received repeated notices over multiple years from the SSA of hundreds of irregularities in the social security numbers used for employment purposes by its workers.
Under the settlement agreement, which remains in effect until July 10, 2016, Buckner agrees to cooperate fully and actively with the U.S. Attorney’s Office and the government entities involved in the investigation. Buckner is also required to continue remedial hiring actions implemented after it learned about the investigation on March 31, 2009. Those actions include using DHS’s “E-Verify” screening program for all new hires, verifying the social security numbers of all Buckner employees, and maintaining an employee hotline to receive reports of any suspected violation of law at the company.
The investigation was conducted by HSI. The case is being handled by Assistant United States Attorneys Edward Grogan and Gwendolyn Carroll.
Bureau of Justice Statistics Releases Tribal Crime Data Collection Activities, 2014<br />Read the Press Release
This fourth annual report to Congress describes efforts to collect and improve data on crime and justice in Indian country, as required by the Tribal Law and Order Act of 2010. The report details the number of tribal law enforcement agencies reporting crime data to the FBI’s Uniform Crime Reporting program. It describes BJS’s first National Survey of Tribal Court Systems which will collect data on tribal courts in the lower 48 states and Alaska covering 566 tribes. The survey will also cover the tribal Courts of Federal Regulations that handle some offenses and resolve disputes among tribal members. It also summarizes tribal eligibility for Edward Byrne Memorial Justice Assistance Grant awards and the total funds awarded to tribes.
http://ojp.gov/newsroom/pressreleases/2014/ojppr071014.pdf
Brooklyn Man Pleads Guilty in Heroin Trafficking Scheme Targeting Mid-Atlantic StatesRead the Press Release
PITTSBURGH – Luis Colon, a resident of Brooklyn, New York, was convicted of conspiring to distribute 100 grams or more of heroin, United States Attorney David J. Hickton announced today.
Colon, 30, pled guilty before United States District Judge David S. Cercone. Judge Cercone scheduled sentencing to occur on Nov. 13, 2014, at 10:30 a.m.
In support of the guilty plea, the Court was informed that Colon would make occasional heroin trafficking trips to Pittsburgh as well as to other locations in the mid-Atlantic region. He was the source of supply for hundreds of grams of heroin for drug traffickers in the Pittsburgh area and elsewhere. Colon was arrested in Richmond, Va., in October 2013, following his indictment in the Western District of Pennsylvania. At the time of his arrest in Richmond, Colon admitted that he had traveled there to collect $5,000.
The law provides for a maximum total sentence of at least five and up to 40 years in prison, a fine of up to $5,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Craig W. Haller is prosecuting this case on behalf of the United States.
The Federal Bureau of Investigation and the Pennsylvania Attorney General’s Office led the multi-agency investigation of this case that also included the Federal Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Moon Township Police Department, the North Fayette Police Department, the Pittsburgh Police Department, the Allegheny County Sheriff’s Office, the Pennsylvania State Police, the McKees Rocks Police Department, the Cranberry Township Police Department, the McKeesport Police Department, and the Wilkinsburg Police Department.
Bridgeport Man Sentenced to 70 Months in Federal Prison for Illegally Possessing Loaded FirearmRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that FEDERICO CANNON, also known as “Rico,” 31, of Bridgeport, was sentenced today by U.S. District Judge Robert N. Chatigny in Hartford to 70 months of imprisonment, followed by three years of supervised release. On May 22, 2013, a jury found CANNON guilty of one count of possession of a firearm and ammunition by a previously convicted felon.
According to the trial evidence, at approximately 1:15 a.m. on February 25, 2012, Bridgeport Police stopped a vehicle in which CANNON was a passenger on Caroline Street in Bridgeport. CANNON initially exited the vehicle and attempted to walk away, but police ordered him back into the car. After directing the driver out of the vehicle, a Bridgeport Police detective observed a semi-automatic pistol on the floor of the rear passenger area in the vicinity of where CANNON was sitting. The firearm was a Smith & Wesson 9mm model 469, loaded with 10 live hollow-point cartridges and two full-metal jacket cartridges.
Prior to February 25, 2012, CANNON had sustained felony drug, firearms and burglary convictions, including a 2006 federal conviction for possession of a firearm and ammunition by a previously convicted felon.
The evidence at trial in the previous federal case revealed that in the early morning hours of October 21, 2004, CANNON was in a car with three other individuals driving northbound on Interstate 95 between Norwalk and Bridgeport when they initiated a confrontation with another car occupied by two men. The confrontation culminated at the bottom of the Exit 25 ramp in Bridgeport when approximately seven or eight shots were fired at the victims’ vehicle. A subsequent search of the vehicle in which CANNON was a passenger revealed a semi-automatic pistol at CANNON’s feet in the right rear passenger seat of the vehicle. The jury found CANNON guilty and, on April 12, 2006, he was sentenced to 42 months of imprisonment.
This matter was investigated by the Bridgeport Police Department and the Federal Bureau of Investigation, with the assistance of the Bureau of Alcohol, Tobacco, Firearms and Explosives. The case was prosecuted by Assistant U.S. Attorney Rahul Kale.
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[email protected]Boston Undercover Operation Results in SEC and Criminal Securities Fraud ChargesRead the Press Release
BOSTON – The Securities and Exchange Commission (SEC) filed suit today charging five individuals who were previously criminally charged and arrested for attempting to manipulate the securities of Massachusetts-based company, Amogear Inc.
The criminal cases charged the following individuals with conspiracy to commit securities fraud: Andrew J. Affa, 30, of Huntington Station, N.Y.; Michael A. Affa, 34, of Toms River, N.J.; Mitchell H. Brown, 48, of Long Branch, N.J.; Christopher R. Putnam, 37, of Charleston, S.C.; and Christopher G. Nix, 34, of Charleston, S.C. Andrew Affa, Michael Affa and Brown were also charged with conspiracy to commit wire fraud. The SEC suit, likewise, charges all five individuals with securities fraud.
Andrew Affa, Michael Affa, and Brown are scheduled to appear in federal court in Boston on July 15 and Putnam and Nix are scheduled to appear on July 31.
It is alleged that in January and February 2014, the defendants attempted manipulation of Amogear’s stock was caught in real-time by a federal undercover operation. The SEC suspended trading in the securities of Amogear on Feb. 10, 2014, as the attempted manipulation of its stock was underway. According to the criminal and SEC charges, prior to the suspension of trading in the stock, the defendants planned and implemented a scheme to create a false appearance of an active market in the stock, followed by a false media campaign designed to increase the price of the stock, knowing that Amogear was a shell company without any real operations. The defendants allegedly planned to sell the stock into the market at artificially inflated prices from which they would profit. What the parties did not know was that Amogear was controlled by the FBI and used by the FBI as a vehicle to obtain evidence of their attempt to manipulate the market.
The charges follow a multi-year investigation focusing on preventing fraud in the microcap stock markets. Microcap companies are small publicly traded companies whose stock often trades at pennies per share. Fraud in the microcap stock markets is of increasing concern to regulators as such markets have proven to be fertile grounds for fraud and abuse. This is, in part, because accurate information about microcap stocks may be difficult for the average investor to find, since many microcap companies do not file financial reports with the SEC.
These latest charges follow a series of cases filed by the SEC and the U.S. Attorney since December 2011 in which 22 individuals have been criminally charged and 18 convicted, for using kickbacks and other schemes to trigger investments in various thinly-traded stocks, and the SEC suspended trading in seven companies.
“As is clear from the combined efforts of the U.S. Attorney’s Office, the FBI, and the SEC, market manipulation will not be tolerated,” said Carmen M. Ortiz, U.S. Attorney for the District of Massachusetts. “The prosecution of corporate and securities fraud is a top priority of the Department of Justice and a top priority for this Office. As is demonstrated by the recent charges, we will continue to develop new techniques to detect and prosecute those engaged in market abuse.”
“Fund representatives, CEOs, traders, fund managers, equities analysts, lawyers and publicists should take note that Boston FBI agents purposefully designed multiple undercover operations aimed directly at rooting out market manipulation and insider trading. As the scope and design of our undercover operations become well-known, no one should think that future undercover operations will be the same as prior ones because in this instance the FBI took control of a publicly traded company making it nearly impossible to discover,” said Vince Lisi, Special Agent in Charge of the FBI’s Boston Division.
Andrew Ceresney, Director of the SEC’s Enforcement Division, said, “The SEC will hold accountable parties who disrupt the fair and efficient functioning of the markets. We are committed to working with our law enforcement partners in Massachusetts and around the country to stop abuses in the microcap sector and hold the perpetrators responsible.”
“These defendants brazenly attempted to manipulate Amogear’s stock,” said Paul G. Levenson, Director of the SEC’s Boston Regional Office. “It didn’t occur to them that the FBI and SEC were a step ahead of them.”
The statute for the criminal charges provides a maximum sentence of five years in prison and a $250,000 fine. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
The SEC is seeking permanent injunctions against further violations of the securities laws, disgorgement of ill-gotten gains plus prejudgment interest, civil monetary penalties, and bars from being involved in offerings of penny stocks.
U.S. Attorney Ortiz, FBI SAC Lisi, and SEC Boston Regional Office Director Levenson made the announcement today. The criminal case is being prosecuted by Assistant U.S. Attorney Vassili Thomadakis of Ortiz’s Economic Crimes Unit, and SEC attorneys Eric Forni and Andrew Palid, who were appointed Special Assistant U.S. Attorneys. The SEC investigation was led by Michele T. Perillo and the SEC litigation will be handled by Martin F. Healey.
Bank Robbers Sentenced to Lengthy Prison TermsRead the Press Release
United States Attorney James Santelle announced that four bank robbers were recently sentenced in federal court in Green Bay for charges stemming from a bank robbery on December 27, 2013, of the BMO Harris Bank, located in Black Creek, WI.
Chief United States District Judge William C. Griesbach sentenced Samuel H. McGee, (age: 25) of Waukegan, Illinois and Clemmie L. Carter, (age: 23) of Appleton, Wisconsin to 11.5 year terms of prison followed by 5 years of supervised release. Lucky Charleston, (age: 23) of Fayetteville, Georgia was sentenced to 9 years in prison followed by 5 years of supervised release and Yolanda Barnes, (age: 19) of Chicago, Illinois received a 4 year prison term followed by 5 years of supervised release.
According to documents released in court McGee, Carter, and Charleston entered the bank shortly after it opened on December 27, 2013. All three individuals wore a mask and carried a loaded firearm. McGee, Carter and Charleston pointed their firearms at the bank employees and ordered them to the ground. McGee later pointed the assault style rifle he was carrying at a customer who entered the bank. Carter and Charleston stole money from several bank drawers. They fled the bank in a car driven by Barnes. Several hours after the bank robbery, Town of Menasha Police officers, working in conjunction with investigators from the Outagamie County Sheriff Department, saw a vehicle matching the description of the getaway car. The occupants of that vehicle, identified as Carter, McGee, and Barnes were arrested. Charleston was later found at a motel room where officers recovered bank funds, the firearms used during the bank robbery, and the clothing worn.
This case was investigated by the Outagamie County Sheriff Department, Town of Menasha Police Department, the Federal Bureau of Investigation and the Outagamie County District Attorneys’ Office. The case was prosecuted by Assistant United States Attorney William Roach.
Baltimore Convicted Felon Exiled to over 9 Years in Prison for Possession of A Stolen GunRead the Press Release
Baltimore, Maryland – U.S. District Judge James K. Bredar sentenced Leverne Alexander Patterson, age 62, of Baltimore, Maryland, today to 115 months in prison, followed by three years of supervised release, for possession of a stolen firearm.The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Acting Special Agent in Charge William P. McMullan of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; Commissioner Anthony W. Batts of the Baltimore Police Department; and Baltimore City State’s Attorney Gregg L. Bernstein.
According to Patterson’s plea agreement, on June 4, 2013, Baltimore Police officers executed a search warrant at a residence in the 2600 block of East Preston Street in Baltimore. Upon entering the home, officers found Patterson and a female in the upstairs bedroom and brought them to the first floor. Officers asked Patterson if he had any drugs, guns, or large sums of money in the house. Patterson advised officers that he had a gun under the bed in the upstairs front bedroom. Officers recovered a loaded .22 caliber handgun from that location. Patterson was arrested after police learned that he was on parole from a previous felony conviction and prohibited from possessing a gun. Patterson told police that he had purchased the gun from an individual on the street for $200. Investigation revealed that the gun had been stolen in Howard County, Maryland in 2003.
United States Attorney Rod J. Rosenstein commended the ATF, Baltimore Police Department and Baltimore City State’s Attorney’s Office for their work in the investigation. Mr. Rosenstein thanked Special Assistant U.S. Attorney Christopher Flagg, a cross-designated Baltimore City Assistant State’s Attorney assigned as part of the Baltimore initiative to combat violent crime, who prosecuted the case.
Attorney General Eric Holder to Deliver Keynote Address at Justice Department and Howard University Celebration of the 50th Anniversary of Civil Rights Act of 1964<br />Read the Press Release
Attorney General Eric Holder will deliver the keynote address at the Department of Justice’s 50th anniversary celebration of the Civil Rights Act of 1964. Secretary of Labor Thomas Perez, Secretary of Education Arne Duncan, Congresswoman Eleanor Holmes Norton, Deputy Attorney General James Cole, Associate Attorney General Tony West, Ambassador Andrew Young and Howard University Interim President Dr. Wayne A.I. Frederick will also deliver remarks at the event co-hosted by Howard University, on TUESDAY, JULY 15, 2014, at 10:00 a.m. EDT, to honor the civil rights movement and celebrate the groundbreaking act.
Journalist Charlayne Hunter-Gault will lead a panel discussion during the program on the impact of the Civil Rights Act of 1964 with Julian Bond, Howard University School of Law Associate Dean for Academic Affairs Lisa A. Crooms-Robinson, Joan Trumpauer Mulholland and Helen Zia.
The event will be live streamed at http://tinyurl.com/och84d4.
WHO: Attorney General Eric Holder, Secretary of Labor Thomas Perez, Secretary of Education Arne Duncan, Congresswoman Eleanor Holmes Norton, Deputy Attorney General James Cole, Associate Attorney General Tony West, Ambassador Andrew Young, Howard University Interim President Dr. Wayne A.I. Frederick, Howard University School of Law Associate Dean for Academic Affairs Lisa A. Crooms-Robinson, Julian Bond, Charlayne Hunter-Gault, Joan Trumpauer Mulholland, Helen Zia
WHAT: “The 50th Anniversary of the Civil Rights Act of 1964: Preserving Progress, Charting the Future”
WHEN: Tuesday, July 15, 2014
10:00 a.m. EDT
WHERE: Cramton Auditorium
Howard University
2455 6th St., N.W.
Washington, D.C.
OPEN PRESS
NOTE: All media must present government-issued photo I.D. (such as driver’s license) as well as valid media credentials. Media interested in attending must RSVP to Erica Lacy at [email protected] no later than 5:00 p.m. EDT, on Monday, July 14, 2014. Media may begin arriving at 8:30 a.m. EDT. All cameras must be pre-set and radios must be in place by 9:30 a.m. EDT. Pen and pad reporters must be in place by 9:50 a.m. EDT.Press inquiries regarding logistics should be directed to Erica Lacy at 202-514-2007 or at [email protected]. Press inquiries regarding interviews with Howard University staff should be directed to Rachel Mann at 202-308-8903 or at [email protected].
Allegheny County Man Pleads Guilty to Violating Federal Gun and Drug LawsRead the Press Release
PITTSBURGH – Dustin Petry, an Allegheny County resident, was convicted of conspiring to distribute heroin and possessing a firearm in furtherance of a drug trafficking crime, United States Attorney David J. Hickton announced today.
Petry, 27, pled guilty before United States District Judge David S. Cercone. Judge Cercone scheduled sentencing to occur on Nov. 13, 2014, at 11 a.m.
In support of the guilty plea, the Court was informed that Petry would receive heroin from his source of supply, he would distribute it to his customers, and he would then pay his source of supply back for the heroin and wait to be supplied with more. Between July 2013 and October 2013, Petry possessed a pistol in furtherance of the heroin trafficking conspiracy. Petry possessed the pistol to, among other things, protect his person, his proceeds, and his heroin from robbery.
The law provides for a maximum total sentence of at least five years and up to life in prison, a fine of up to $1,250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Craig W. Haller is prosecuting this case on behalf of the United States.
The Federal Bureau of Investigation and the Pennsylvania Attorney General’s Office led the multi-agency investigation of this case that also included the Federal Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Moon Township Police Department, the North Fayette Police Department, the Pittsburgh Police Department, the Allegheny County Sheriff’s Office, the Pennsylvania State Police, the McKees Rocks Police Department, the Cranberry Township Police Department, the McKeesport Police Department, and the Wilkinsburg Police Department.
67 Year-Old Church Secretary Sentenced to Federal Prison for Stealing from ChurchRead the Press Release
Contact Person: Jim May (803) 929-3000
Columbia, South Carolina -----United States Attorney Bill Nettles stated today that Sandra A Stroupe, age 67, of Clover, South Carolina was sentenced today in federal court in Columbia, South Carolina, to a term of imprisonment of 24 months in federal prison. Stroupe was the secretary/bookkeeper at the Clover ARP Church for over 38 years. Beginning in at least 2006 and continuing until April of 2013 Stroupe embezzled over $600,000 of church money.
Senior United States District Judge Margaret B. Seymour sentenced Stroupe and ordered that Stroupe pay restitution to her victim.
The case was investigated by agent Devon Mahoney of the FBI. Assistant United States Attorney James (Jim) Hunter May of the Columbia Office prosecuted the case.
Thursday 10 July 2014
Wilkes-Barre Man Sentenced to Prison on Drug ChargesRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a Wilkes-Barre man was sentenced yesterday, in federal court in Wilkes-Barre, by United States District Judge A. Richard Caputo, to serve 41 months in prison on a charge of conspiracy to distribute heroin.
According to United States Attorney Peter Smith, Dwayne Webb, age 33, a resident of Wilkes-Barre pleaded guilty to the charge in March of this year.
Webb was charged after an investigation conducted by the United States Drug Enforcement Administration, the Pennsylvania State Police and the Wilkes-Barre Police Department. An Indictment was filed against Webb and twelve other persons on June 4, 2014. Webb was classified as a career offender under the United States Sentencing Commission advisory sentencing guidelines.
The case was prosecuted by Assistant United States Attorney William S. Houser.
Western Slope Man Sentenced to 46 Months in Federal Prison for Defrauding the IRS and for Possession of A Firearm by A FelonRead the Press Release
DENVER –Michael L. Roy, age 50, of Clifton, Colorado, was sentenced yesterday by U.S. District Court Judge Raymond P. Moore to serve 46 months in federal prison for conspiracy to defraud the United States and being a felon in possession of a firearm, United States Attorney John Walsh and IRS Criminal Investigation Special Agent in Charge Stephen Boyd announced. Roy was ordered to spend 3 years on supervised release following the service of his term of imprisonment. Judge Moore also ordered him to pay $65,263 in restitution to the IRS.
Roy had waived his right to be indicted by a federal grand jury and was charged by an Information on January 28, 2014. He pled guilty on March 17, 2014.
According to the facts contained in the Information as well as the stipulated facts contained in the plea agreement, in July 2013, the United States Postal Service intercepted eleven envelopes containing U.S. Treasury checks (IRS refund checks) and addressed to the home address of Michael and Kandiann Roy in Clifton, CO. Each of the envelopes were addressed to a different individual, and each check had a processing date of July 2013. Postal employees had also noticed Roy received letters from individuals within the Arizona State prison system. The mail carrier found a typed list with eleven names taped inside Roy’s mail box. The list appeared to serve as notification that the owner of the box would be receiving mail for these individuals.
IRS records showed that the list included eleven names for individuals who purported to file IRS Forms 1040EZ , U.S. Individual Income Tax Return, using Roy’s address. A total of 30 IRS Form 1040EZ returns, submitted for the 2012 tax year, were filed using either Roy’s current or former home address. All of the returns requested tax refunds. Twenty-six of the returns each list an identical income of $37,429, withholdings of $12,976 and refund amounts of $9,260 and were filed by mail; the refunds of eight of those returns were deposited into Roy’s bank account. The loss to the government to date is calculated at $65,263. Had all of the tax refunds requested by Roy been paid by the IRS, the loss would have amounted to $265,915.
Twenty of the returns filed using one of the Roy's addresses purported to be from taxpayers who are incarcerated prisoners. Eighteen of these prisoners are incarcerated in the Arizona State prison, located in Eyman, Arizona. Roy, previously known as Michael Demes, was convicted in Arizona of the felonies of robbery and aggravated assault and incarcerated under that name in the Arizona prison system beginning in 1999. He was sentenced to a seven-year prison term.
On September 19, 2013, Special Agents with IRS Criminal Investigation executed a search warrant on Roy’s home in Clifton, Colorado. During the search warrant, IRS Special Agents found documentary evidence that Roy had filed the bogus tax returns. They also found Moneygram receipts and letters to and from an inmate in the Arizona State prison, which included details of the conspiracy to file false income tax returns using the identity of other inmates. In addition, agents found a firearm, a Hi-Point .380 caliber handgun.
This case was investigated by IRS-Criminal Investigation, and the United States Postal Inspection Service. The case was prosecuted by Assistant U.S. Attorney Michelle M. Heldmyer.
Watertown Area Hospital Settles Health Care LawsuitRead the Press Release
SYRACUSE, NEW YORK - United States Attorney Richard S. Hartunian announced today that his office has settled a civil action under the False Claims Act, against the Carthage Area Hospital. This case involves allegations that the Carthage Area Hospital (“Carthage”) doublebilled Medicare for operating room services and ambulatory services from September 1, 2006 through June 30, 2010. Carthage submitted approximately 1900 claims for payment to Medicare which improperly contained both revenue code 360 (operating room services) and revenue code 490 (ambulatory surgery).
The parties have agreed to a civil resolution of this case, in which Carthage will pay the United States $750,000.00. While the United States was entitled to seek double or treble damages plus fines and penalties under the False Claims Act, this settlement reflects single damages (the approximate amount of the excess billing), in light of the unique circumstances of this case and the full cooperation of Carthage throughout this investigation.
Richard S. Hartunian, United States Attorney for the Northern District of New York, stated that “Health care fraud is a priority of the Department of Justice and this office. This settlement reflects an appropriate resolution of this case in light of the circumstances. We wish to recognize the full cooperation of Carthage throughout this investigation.”
This case was investigated by the U.S. Department of Health and Human Services, Office of the Inspector General (“HHS OIG”). The excess billing was confirmed by the HHS OIG investigation, as well as a self-audit conducted by Carthage.
This matter is assigned to Assistant U.S. Attorney Charles E. Roberts. News inquiries should be directed to Executive Assistant United States Attorney John Duncan, tele. (315) 448- 0672.
U.S. Branch of Canadian Company to Pay $2.5 Million Penalty for Shreveport, La., Wastewater PlantRead the Press Release
Houston-based CCS (USA) Inc. and several of its operating subsidiaries will pay a $2.5 million civil penalty relating to operations at its Shreveport, Louisiana, industrial wastewater treatment plant, the Department of Justice, U.S. Environmental Protection Agency (EPA) and the state of Louisiana announced today. The settlement will resolve violations of the Clean Water Act, the Clean Air Act and the hazardous waste law known as RCRA.
CCS acquired the plant in 2006 through its purchase of two closely held companies owned by John Emerson Tuma. Tuma is now serving a five-year prison sentence for illegally discharging untreated and improperly treated wastewater from the plant into the Red River and Shreveport Publicly Owned Treatment Works (POTW). Inspections by EPA and the Louisiana Department of Environmental Quality following the sale led to the discovery of these violations and others, including unpermitted storage and improper handling of hazardous wastes and sludge, unpermitted stormwater discharges and noncompliance with Clean Air Act requirements for benzene-containing wastes.
After discovering these violations, CCS ceased wastewater treatment operations at the facility. Under EPA supervision, CCS removed the hazardous wastes illegally stored there.
The $2.5 million civil penalty will be split evenly between the United States and state of Louisiana.
The stipulation of settlement, filed in the U.S. District Court for the Western District of Louisiana, is subject to a 45-day public comment period and approval by the federal court.