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Monday 30 June 2014
Former MoneyGram and Western Union Outlet Operator Sentenced to Federal Prison for Consumer Fraud and Money LaunderingRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania, announced that today in Harrisburg a Texas man was sentenced by Chief U.S. District Court Judge Christopher C. Conner to 168 months’ (14 years) incarceration plus 3 years of supervised release and ordered to pay restitution for his role in defrauding over 1,200 consumer fraud victims out of $3.9 million and for laundering the proceeds.
According to U.S. Attorney Peter Smith, following a week-long trial in Harrisburg in July 2013, Olufemi Adigun, age 28, of Houston, Texas, was convicted by a jury on 14 counts, including conspiracy to commit mail and wire fraud, conspiracy to commit money laundering, unlawful monetary transactions, and money laundering.
Evidence at trial revealed that in 2008, Adigun operated MoneyGram and Western Union outlets out of an empty Houston storefront known as FAB Tax Services, a phony tax service provider. The location was used by Adigun and two conspirators, Benjamin Chikwe and Stanley Ohiri, to intercept $3,919,721 sent by approximately 1,240 victims from across the United States, including victims in Central Pennsylvania who were induced to send the transfers through mass marketing consumer fraud schemes.
The schemes relied on MoneyGram and Western Union money transfer systems for success. Commonly known as Secret Shopper, Grandma Scams, Advance Fee, or Canadian Lottery scams, these schemes have defrauded more than 500,000 Americans out of an estimated $1 billion since 2004. Typical victims are the elderly.
Many fraudsters contact victims via the U.S. mail, interstate courier, or the Internet promising cash prizes, lottery winnings, fictitious loans, or other payments. Counterfeit checks are then sent to the victims who are induced into cashing them and returning a portion of the funds to the fraudsters via the MoneyGram and Western Union money transfer systems. Victims eventually suffer a financial loss after the counterfeit checks bounce. Other Internet-based schemes induce the victims to purchase non-existent merchandise, such as automobiles and motorcycles, via “too good to be true” pricing.
The fraudsters exploit the way MoneyGram and Western Union operate their money transfer systems to conceal their identities and enlist corrupt MoneyGram and Western Union agents like Adigun to help launder the proceeds. Adigun entered false payee addresses, telephone numbers, and identification information into the MoneyGram and Western Union data-bases, thereby maintaining the anonymity of the fraudsters and creating the illusion that a bona-fide payee had physically entered the receiving outlet.
The victims were instructed to provide the Money Transfer Reference Number (MTRN) immediately after the money is sent. Armed with the MTRN, corrupt MoneyGram or Western agents in the United States could intercept and remove the funds from the systems, even though Adigun was physically located in Texas, thousands of miles away from the intended destination.
After Adigun and his co-conspirators intercepted the $3.9 million, they laundered the funds by converting, approximately $3.1 million into cash. Adigun, who controlled three FAB bank accounts, personally withdrew $1,453,146 cash from the accounts by making 203 withdrawals from 17 different bank branches. On many days, Adigun’s cash withdrawals totaled $40,000 to $70,000.
Other funds were laundered by transferring a portion of the proceeds, approximately $746,000, to other bank accounts before removing the money via cash withdrawals. Other proceeds, approximately $690,000, were sent via the Western Union and MoneyGram money transfer systems to destinations around the world, including in Canada, Nigeria, and Romania.
Adigun’s Indictment identified five mid-state residents from Chambersburg, Hanover, State College, and Mechanicsburg who each lost approximately $3,000 as a result of a mass marketing, consumer fraud scam during the summer of 2008. Their money was intercepted and removed from the MoneyGram transfer system by Adigun and his co-conspirators.
One of Adigun’s conspirators was Benjamin Chikwe, age 33, also of Houston, Texas, who was indicted with Adigun and pleaded guilty to conspiracy to commit money laundering charges pursuant to a cooperation-based plea agreement last year. In December 2013 Judge Conner sentenced Chikwe to 33 months in prison. The third conspirator, Stanley Ohiri, is a fugitive who may be in Nigeria.
Adigun began operating FAB as a Western Union outlet in December 2007 and as a MoneyGram outlet in May 2008. Shortly after, dozens of customers filed Consumer Fraud Reports with MoneyGram and Western Union. MoneyGram did not close FAB until August 18, 2008; Western Union did not suspend FAB until September 2, 2008.
In November 2012, charges of aiding and abetting wire fraud and willful failure to implement an effective anti-money laundering program were filed against MoneyGram in Harrisburg by the U.S. Department of Justice and the U.S. Attorney’s Office for the Middle District of Pennsylvania.
The charges were, in part, based on the company’s failure to terminate dozens of corrupt, agents in the United States and Canada, like FAB Tax Services, between 2004 and 2009. MoneyGram entered into a Deferred Prosecution Agreement with the government. That required MoneyGram to forfeit the sum of $100 million, implement improvements in the way it conducts its anti-money laundering program, undergo a five-year period of evaluation and oversight by a Corporate Compliance Monitor selected by the Department of Justice, and cooperate with the government. If MoneyGram successfully completes the five-year program, the government has agreed to dismiss the charges. The government is utilizing the forfeiture to establish a consumer fraud victim restitution fund. The U.S. Postal Service has distributed $46,371,155 of the $100 million to 18,784 victims across the country.
The case is part of a long term continuing investigation by the Harrisburg Office of the U.S. Postal Inspection Service. The Adigun, Chikwe, Ohiri, and MoneyGram prosecutions are being handled by Assistant United States Attorney Kim Douglas Daniel.
Former Federal Express Employee Sentenced to 41 Months in Federal Prison for Stealing Suspected Drug-Related CashRead the Press Release
MEDFORD, OR – Victor Manuel Chavez, 40, of Medford, Oregon, was sentenced Monday to forty-one months in federal prison by Senior U.S. District Judge Owen M. Panner, after Chavez pleaded guilty in March 2014 to theft from interstate shipment and money laundering. As part of his sentence, Chavez was fined $25,000, will serve three years of post-prison supervised release, and must pay restitution to victims of the theft.
Chavez was employed by Federal Express for four years as a driver and was responsible for unloading FedEx packages from aircrafts at the Medford, Oregon airport and delivering them to their ultimate destinations. In 2011 and 2012 Chavez engaged in a scheme by identifying packages he believed contained large quantities of cash - suspected by law enforcement to be the proceeds of marijuana sales - as well as electronic equipment, jewelry and other valuable items. Once identified, Chavez reprinted FedEx labels, re-routing the targeted packages to his truck, enabling him to steal the packages. Chavez sold stolen electronics and other items to his friends and associates.
On January 30, 2012, law enforcement served a search warrant at Chavez’s residence and seized evidence, which included rolls of FedEx adhesive labels and several items of merchandise which matched items reported missing by FedEx customers. Law enforcement also searched a suitcase Chavez had given to a friend to hold in return for $10,000. Inside the suitcase was $250,000 in cash. Law enforcement believe that most if not all of this money was the proceeds of marijuana sales by Oregon growers, who use Federal Express and other delivery service companies to send Oregon grown marijuana to out of state customers, in return for cash payments sent back to them via the same companies. Subsequent investigation revealed that Chavez had used some of the stolen money to pay his mortgage, and laundered other proceeds through bank accounts he controlled. In total, law enforcement officials believe that Chavez stole more than $200,000 in cash and property.
The $263,525 in U.S. currency seized from Chavez has been forfeited. Additionally, forfeited items include lap tops, i-Pads, i-Phones, other electronic items and sports equipment.
“People like Mr. Chavez, who abuse their position of trust to steal, will be caught and prosecuted,” stated U.S. Attorney S. Amanda Marshall.
This case was investigated by the Medford Police Department and the Federal Bureau of Investigation and prosecuted by Assistant U. S. Attorney Judith Harper.
Former Employee Sentenced for Stealing $289,000 from A Wichita BankRead the Press Release
WICHITA, KAN. A former employee was sentenced Monday to 21 months in federal prison for stealing at least $289,000 from a Wichita bank, U.S. Attorney Barry Grissom said.
Lisa Marie Evans, 43, Wichita, Kan., pleaded guilty to one count of embezzlement. In her plea, she admitted that from 2011 to 2013 she stole the money while working for Southwest National Bank in Wichita. She was responsible for balancing the bank vault on a daily basis. A surprise audit in April 2013 revealed the theft. Investigators examined security footage of the vault that showed Evans taking money from the vault and hiding it on her person.
Grissom commended the FBI and Assistant U.S. Attorney Aaron Smith for their work on the case.
Former Canistota Woman Convicted of Tax FraudRead the Press Release
United States Attorney Brendan V. Johnson announced that Veronica Fairchild, age 42, of Canistota, South Dakota, and Okoboji, Iowa, was found guilty of four counts of tax fraud as a result of a federal jury trial in Sioux Falls, South Dakota.
The charges carry a maximum penalty of three years in custody and/or a $250,000 fine on each charge, 1 year of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Fairchild was indicted by a federal grand jury on July 9, 2013. The investigation stemmed from Fairchild’s late filing of her 2005 through 2008 income tax returns in 2010. Bank records revealed she had failed to claim over $600,000 in income over the four-year period of time. Fairchild claimed the unreported income that she received from performing private shows as an exotic dancer was a gift.
A jury trial commenced on June 24, 2014, and completed on June 26, 2014, with the jury convicting Fairchild on all four counts of the Indictment.
This case was investigated by the Internal Revenue Service Criminal Investigation Division. Assistant U.S. Attorney Jeffrey C. Clapper prosecuted the case.
A presentence investigation was ordered and a sentencing date was set for September 22, 2014. The defendant was released on bond pending sentencing.
Federal Judge Orders Concurrent Prison Time for Farrell Man Serving Two Life SentencesRead the Press Release
PITTSBURGH - A resident of Farrell, Pa., pleaded guilty and was sentenced in federal court to charges of violating federal Hobbs Act conspiracy and Hobbs Act robbery laws, United States Attorney David J. Hickton announced today.
Joshua Stewart, 20, was 18 years old at the time that he robbed the B&M Market in Farrell on Dec. 20, 2011. Stewart, who is serving two life sentences for murder relating to the December, 2011 killing of Farrell bar owner William Basilone, Jr., pled guilty to two counts before United States District Judge Terrence F. McVerry.
In connection with the guilty plea, the Court learned that on Dec. 20, 2011, Stewart, acting together with another, entered the B&M Market, a local convenience store. Upon entering the store, Stewart’s co-conspirator, using force and intimidation, demanded that the store owner open his register and hand over more than $100 in cash. While the co-conspirator did this, Stewart kept watch and served as a “lookout,” making sure that the police did not come in the store. In addition, Stewart stole cigarettes from the store. After these items were taken, both robbers fled from the store.
On Jan. 17, 2014, Stewart’s co-conspirator Devine Campbell pled guilty to conspiracy to commit Hobbs Act robbery and Hobbs Act robbery in federal court and was sentenced to 15-years in prison. Campbell admitted that he shot the owner of B&M Market during the course of the Dec. 20, 2011 robbery.
Subsequent to pleading guilty, Stewart waived a pre-sentence report and was sentenced by Judge McVerry to 10 years in prison. Under the terms of the plea agreement, this sentence is to be served concurrently with Stewart’s life sentence for murder. In September, 2013, a jury in Mercer County convicted Stewart of murdering Basilone. The remaining five years of Campbell’s federal sentence is to be served consecutively to Campbell’s state court murder sentence.
Assistant United States Attorney Eric S. Rosen prosecuted this case on behalf of the government.
The Federal Bureau of Investigation, the Southwest Mercer County Police, and the Mercer County District Attorney’s Office conducted the investigation that led to the prosecution of Joshua Stewart.
Essex County, N.J., Man Charged with Armed Robbery of Irvington BankRead the Press Release
NEWARK, N.J. – An Essex County, N.J., man made his initial court appearance today on charges of bank robbery in connection with an attempt to rob a bank in Irvington, N.J., U.S. Attorney Paul J. Fishman announced.
Karim Brunson, 24, of Newark, was charged by complaint with one count of bank robbery and one count of possession of a firearm during the commission of a crime of violence. He made his initial court appearance today before U.S. Magistrate Judge Joseph A. Dickson in Newark federal court.
According to documents filed in this case and statements made in court:
Brunson allegedly entered the front door of the Investors Savings Bank in Irvington at 11:30 a.m. on June 28, 2014, with a dark-colored mask over his face. Brunson pulled out a loaded .357-caliber revolver handgun from his waistband and pointed it into the lobby. An off-duty Irvington Police lieutenant was in uniform and working inside the bank as a security guard. As Brunson entered the lobby, he pointed the handgun at the officer’s head and threw a plastic shopping bag toward one of the bank tellers. Brunson then yelled for the teller to “Put the money in the bag.”
When Brunson looked away momentarily, the off-duty police officer grabbed Brunson’s hand and the gun and fought with Brunson on the floor of the bank lobby. Another bank employee and a second off-duty police officer arrived to help the Irvington Police lieutenant subdue Brunson.
The bank robbery charge carries a maximum potential penalty of 20 years in prison. The weapons charge carries a mandatory seven years in prison to be served consecutively to his sentence on the bank robbery.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford, and officers of the Irvington Police Department, under the direction of Police Director Joseph Santiago, with the ongoing investigation that led to the charges.
The government is represented by Assistant U.S. Attorney James Donnelly of the Criminal Division in Newark.
The charges and allegations contained in the complaint are merely accusations and the defendant is presumed innocent unless and until proven guilty.
14-237
Defense counsel: Linda Foster Esq., Assistant Federal Public Defender, Newark
Brunson, Karim Complaint
Easley Dentist Pleads Guilty to Failing to Pay over Employment TaxesRead the Press Release
Contact Person: Will Lucius (864) 282-2100
Columbia, South Carolina -----United States Attorney Bill Nettles stated today that DANIEL PASUI, age 43, of Easley, South Carolina, pled guilty today in federal court in Anderson, to eight counts of failing to pay over to the Internal Revenue Service taxes that had been withheld from employees of his dental practice as well the practice’s share of FICA contributions, each a violation of Title 26, United States Code, Section 7202. Senior United States District Judge G. Ross Anderson, Jr. accepted the plea and will impose sentence after he has reviewed a presentence report which will be prepared by the U.S. Probation Office.
Had the case gone to trial, the Government was prepared to show that during eight quarters between March 2009 and June 2011, PASUI collected employment taxes, accounted for the collections on filed returns, but failed to pay over to the Internal Revenue Service a total of approximately $308,781.00.
Mr. Nettles stated the maximum penalty PASUI can receive on each count is a fine of $250,000.00 and/or imprisonment for 5 years, plus a special assessment of $100.00.
The case was investigated by Criminal Investigation agents of the Internal Revenue Service. Assistant United States Attorney William C. Lucius of the Greenville office handled the case.# # #
Eagle Butte Man Charged with Failure to Register as A Sex OffenderRead the Press Release
United States Attorney Brendan V. Johnson announced that an Eagle Butte, South Dakota, man has been indicted by a federal grand jury for Failure to Register as a Sex Offender.
David Marrowbone, age 51, was indicted on June 10, 2014. He appeared before U.S. Magistrate Judge Mark A. Moreno on June 26, 2014, and pled not guilty to the Indictment.
The maximum penalty upon conviction is 10 years in custody and/or a $250,000 fine, a minimum of 5 years up to life of supervised release, and a $100 special assessment to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that between February 3, 2014, and March 13, 2014, Marrowbone moved and failed to change and update his sex offender registration as required by law. Marrowbone was previously convicted of a sex offense that required him to register as an offender. He signed paperwork acknowledging his duty to register as a sex offender.
The charge is merely an accusation and Marrowbone is presumed innocent until and unless proven guilty.
The investigation is being conducted by the U.S. Marshals Service. Assistant U.S. Attorney Mikal Hanson is prosecuting the case.
Marrowbone was remanded to the custody of the U.S. Marshals Service. Trial has been set for August 26, 2014.
Denso Corp. Executive Agrees to Plead Guilty to Price Fixing on Automobile Parts Installed in U.S. CarsRead the Press Release
An executive of Japan-based Denso Corp. has agreed to plead guilty and to serve one year and one day in a U.S. prison in connection with the Antitrust Division’s investigation into a conspiracy to fix the prices of instrument panel clusters, also known as meters, installed in cars sold in the United States and elsewhere, the Department of Justice announced today.
A one-count felony charge was filed on June 27, 2014, in the U.S. District Court for the Eastern District of Michigan in Detroit against Satoru Horisaki, a group leader in Denso’s Utsunomiya Branch Office. According to the charge, Horisaki, a Japanese national, participated in the conspiracy from in or about 2009 to in or about February 2010, by agreeing upon bids and prices for, and allocating the supply of, automotive instrument panel clusters sold to Honda of America Manufacturing Co. Inc., in the United States and elsewhere. In addition to the prison sentence, Horisaki has agreed to pay a $20,000 criminal fine and to cooperate with the department’s ongoing investigation. The plea agreement will be subject to court approval.
“This charge is the latest effort by the Antitrust Division to hold executives accountable for engaging in anticompetitive conspiracies that do real harm to the U.S. economy,” said Brent Snyder, Deputy Assistant Attorney General for the Antitrust Division’s criminal enforcement program. “The conspirators undermined a competitive bidding process by meeting to discuss and agree on price quotations.”
Instrument panel clusters are the mounted array of instruments and gauges housed in front of the driver of an automobile.
In March 2012, Denso pleaded guilty and was sentenced to pay a $78 million criminal fine for its role in conspiracies to fix the prices of heater control panels and electronic control units. Horisaki is the sixth Denso executive to be convicted in the Antitrust Division’s investigation into the automotive parts industry.To date, 36 individuals, including Horisaki, have been charged in the department’s ongoing investigation into price fixing and bid rigging in the auto parts industry. Additionally, 27 companies have pleaded guilty or agreed to plead guilty and have agreed to pay a total of over $2.3 billion in fines.
Horisaki is charged with price fixing in violation of the Sherman Act, which carries a maximum sentence of 10 years in prison and a $1 million criminal fine for individuals. The maximum fine for an individual may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
The charges announced today arose from an ongoing federal antitrust investigation into price fixing, bid rigging and other anticompetitive conduct in the automotive parts industry, which is being conducted by each of the Antitrust Division’s criminal enforcement sections and the FBI. This case was brought by the Washington Criminal I Section and the San Francisco Office of the Antitrust Division, with the assistance of the Detroit Field Office of the FBI. Anyone with information concerning the focus of this investigation should contact the Antitrust Division’s Citizen Complaint Center at 1-888-647-3258, visit www.justice.gov/atr/contact/newcase.html or call the Detroit Field Office of the FBI at 313-965-2323.
Dedham Man Arrested on Armed RobberyRead the Press Release
BOSTON – A Dedham man previously convicted of armed bank robbery was arrested Friday for allegedly robbing an Attleboro bank in May.
Lawrence J. Costello, 54, was charged in U.S. District Court in Boston by criminal complaint for armed bank robbery.
According to an affidavit filed with the complaint, Costello and another individual allegedly entered the Bank of America in Attleboro on May 12, armed with a semi-automatic weapon. Once inside the bank, Costello climbed over the teller’s counter and took $17,687. The robbers were observed fleeing the area in a green Ford pickup truck which had been reported stolen earlier in the day from a garage in Canton. Costello was determined to be one the individuals who participated in the robbery based on DNA matches and witness identification.
Costello appeared before Magistrate Judge David H. Hennessy in Boston on June 27 for an initial appearance. He will remain in custody pending his detention hearing on July 15.
The charging statute provides a sentence of no greater than 25 years in prison, five years of supervised release, a fine of $250,000 and restitution to Bank of America in the amount of $17,687. Actual sentences for federal crimes are typically substantially less than the maximum penalties, as they are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz; Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation; Colonel Timothy Alben, Superintendent of the Massachusetts State Police; Attleboro Police Chief Kyle Heagney; and Bourne Police Chief Dennis Woodside made the announcement today. The case is being prosecuted by Kenneth G. Shine of Ortiz’s Major Crimes Unit.The details contained in the charging document are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Clarks Summit Man Pleads Guilty to Producing Child PornographyRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a Clarks Summit man pleaded guilty today before Senior U.S. District Court Judge James M. Munley to producing child pornography.
According to United States Attorney Peter Smith, the defendant, Taylor Bzdyr, age 20, admitted to using a computer and a cell phone to persuade a 13-year-old female from Canada to engage in sexual acts which were transmitted live via Skype. Bzdry committed the offense between October 2012 and October 2013.
Bzdyr was indicted by a federal grand jury sitting in Scranton on March 11, 2014, as a result of an investigation by the Federal Bureau of Investigation, Border Patrol Agents in California, and the New Westminster Police Department in British Columbia, Canada.
Bzdyr faces a mandatory minimum sentence of 15 years in prison and a possible maximum sentence of 30 years in prison. Judge Munley ordered a pre-sentence report to be completed, and scheduled sentencing for October 2, 2014.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
The case is being prosecuted by Assistant U.S. Attorney Francis P. Sempa.
Camp Pendleton Marine Captain Sentenced to Prison for Multi-Year Housing and VA Fraud SchemesRead the Press Release
Former U.S. Marine Captain Shawn A. Joyce was sentenced in federal court today to four months in prison followed by a year of home confinement for submitting tens of thousands of dollars in false lodging receipts to the Marine Corps and the Department of Veterans Affairs from 2009 to 2011. At the time of the offenses Joyce was on active-duty and stationed at Marine Corps Base Camp Pendleton.
U.S. District Judge John A. Houston also ordered Joyce to pay over $90,000 in restitution.
Joyce pleaded guilty on August 21, 2013, to two counts of wire fraud. As detailed in his plea agreement, Joyce had initially been discharged from active duty in October 2008, entered the Marine Corps reserves, and thereafter sought and obtained orders placing him back on active duty at Camp Pendleton. Under certain circumstances, reservists who are called to active duty become eligible for a housing reimbursement benefit during the term of their active duty, in addition to the basic allowance for housing that they receive.
Joyce exploited this housing reimbursement benefit by falsely claiming reimbursement for rent that he never paid. Specifically, in 2009 and 2010, Joyce falsely claimed to be paying rent up to $4,030 per month for an address in Solana Beach. In 2011, Joyce falsely claimed to be paying rent of $3,700 per month for an address in Fountain Valley.
In order to conceal and disguise the fraud, Joyce submitted false rental receipts to the Marine Corps and created a fake email address in the name of his former landlord at the Solana Beach address. This email address was then used without his former landlord’s knowledge or consent to facilitate the fraud.
In his plea agreement, Joyce also admitted to devising a separate scheme to defraud the Department of Veterans Affairs of tens of thousands of dollars. Under federal law, a service member receiving VA disability benefits is not entitled to simultaneously receive active duty compensation. To avoid this type of “double payment,” service members who receive VA disability benefits are required to inform the VA when they are placed on active duty.
Despite this regulation, Joyce failed to advise the VA and continued to receive VA disability benefits to which he was not entitled. Compounding the loss, Joyce contacted the VA from time to time trying to increase the amount of his improper disability payments.
Joyce pled guilty to two counts of wire fraud and acknowledged defrauding the Defense Department of $48,740 (count one) and the VA of $41,862 (count two). In his plea agreement, Joyce also agreed to pay restitution in the full amount of the losses.
This morning, Judge Houston ordered Joyce to pay those amounts back to the Defense Department and the VA as part of the sentence.
U.S. Attorney Duffy stated, “We will vigorously investigate and prosecute those who try to defraud this country’s Armed Forces or to cheat the Department of Veterans Affairs.”
Special Agent in Charge Douglas J. Carver, VA Office of Inspector General Western Field Office in Los Angeles, said: “The Department of Veterans Affairs depends on the honesty of claims filed by our veterans. Cases like this are thoroughly investigated by the VA OIG to reclaim the VA’s limited resources to insure funds are properly paid to entitled veterans.”
DEFENDANTShawn A. Joyce
Age: 34 Encinitas, California INVESTIGATING AGENCIESDepartment of Veterans Affairs, Office of Inspector General
Naval Criminal Investigative Service*Indictments and complaints are not evidence that the defendant committed the crime charged. All defendants are presumed innocent until the United States meets its burden in court of proving guilt beyond a reasonable doubt.
Business Owner Sentenced to Prison for Obstructing the Collection of $3 Million in Employment TaxesRead the Press Release
ATLANTA - Paulette Bryant has been sentenced to three years in prison for obstructing and impeding the IRS’s collection of almost $3 million in payroll taxes that her business withheld from employee paychecks over a ten year period.
“Honest, hardworking citizens should be assured that employers or business owners who withhold payroll taxes from paychecks and then fail to pay those funds to the IRS will be prosecuted,” said United States Attorney Sally Quillian Yates.
“The manipulation of the payroll system to steal income and evade taxes is a serious offense,” stated Veronica F. Hyman-Pillot, Special Agent in Charge with IRS Criminal Investigation. “This sentence is a vital element in maintaining the public confidence in our legal and financial system.”
According to United States Attorney Yates, the charges and other information presented in court: Bryant owned and operated a temporary employment staffing business with several locations in North Georgia. Bryant’s business was responsible for withholding payroll taxes from employee paychecks and, along with quarterly filings, paying those taxes and her company’s share of employment taxes to the IRS.
Between 1998 and 2009, except for brief periods during or relating to an IRS audit, Bryant’s business failed to make the required quarterly filings and to pay the IRS the payroll taxes owed by her employees and business. In 2001, the IRS audited her business and assessed Bryant a personal penalty of $1 million in unpaid payroll taxes going back to 1998. Even after this audit and penalty, which went unpaid, Bryant and her businesses continued to fail to file with the IRS and to pay payroll taxes. By 2009, the unpaid payroll taxes and penalty totaled $2,914,931.12.
Bryant used the funds that should have been paid to the IRS to operate her company and fund her personal lifestyle. Although the operation of her business essentially remained the same during this period, Bryant formed and used new, overlapping corporate identities that had various names and that used various pseudonyms as corporate officers. The effect of this was to delay and hinder the IRS’s efforts to collect the employment taxes that her business owed. The business identities used by Bryant included Selective Employment Services, Inc. (formed in 2001), Corporate Staffing, Inc. (formed in 2002), Corporate Solutions Group, Inc. (formed in 2004), and Optimum Staffing Solutions Corporation (formed in 2009).
Bryant, 68, of Stockbridge, Ga., has been sentenced to three years in prison to be followed by 1 year of supervised release, and ordered to pay restitution in the amount of $2,914,931.12. Bryant was convicted of obstructing and impeding the IRS’s collection of payroll taxes on October 9, 2013, after she pleaded guilty to an Information.
This case was investigated by the Internal Revenue Service-Criminal Investigation.
Assistant United States Attorney Douglas W. Gilfillan prosecuted the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao/gan/.
Bronx Tax Preparer Sentenced in Manhattan Federal Court to 57 Months in Prison for Tax Fraud Scheme Involving over $7 Million in Bogus DeductionsRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that MARK GOLDBERG, a Bronx-based tax preparer, was sentenced today in Manhattan federal court to 57 months in prison for his participation in a scheme to file fraudulent tax returns on behalf of thousands of clients, falsely claiming more than $7 million in bogus deductions, including false school tuition credits and expenses. GOLDBERG pled guilty in August 2013 before Chief U.S. District Judge Loretta A. Preska, who also imposed today’s sentence.
Manhattan U.S. Attorney Preet Bharara said: “Mark Goldberg prepared thousands of fraudulent tax returns that resulted in over $2.5 million in fraudulent refunds for his clients. Now he has to surrender the ill-gotten gains and his liberty.”
According to the Indictment, statements made during court proceedings, and other documents filed in Manhattan federal court:
GOLDBERG ran a tax preparation and multi-service business named E&M Multi-Services, Inc. (“E&M”) out of a storefront building in the Bronx. Through that business, he prepared, and oversaw the preparation of, thousands of federal and New York State tax returns that claimed false deductions, expenses, and credits, including tuition credits and expenses, unreimbursed employee business expenses, medical and dental expenses, charitable gifts, and earned income tax credits. Between 2005 and 2012, GOLDBERG caused the preparation and filing of tax returns for his clients that included over $7 million of fabricated and fraudulently-inflated deductions, resulting in over $2.5 million in refunds being paid to his clients to which they were not lawfully entitled. GOLDBERG also failed to report any of the income derived from his tax preparation activities, and further submitted fraudulent personal returns claiming bogus refunds and tax credits.
In addition to the prison term, Chief Judge Preska ordered GOLDBERG, 40, of the Bronx, to pay restitution in the amount of $2,597,419 to the United States and the State of New York for the losses caused as a result of his scheme, and to forfeit $500,000 in fees generated by GOLDBERG as part of his tax fraud scheme. Chief Judge Preska also sentenced GOLDBERG to three years of supervised release, and ordered him to pay a special assessment of $300.
Mr. Bharara praised the investigative efforts of the Internal Revenue Service-Criminal Investigation and the New York State Department of Taxation and Finance. Mr. Bharara also thanked the U.S. Department of Justice’s Tax Division and the Bronx District Attorney’s Office for their assistance.
The case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorneys Stanley J. Okula, Jr., and Paul Monteleoni, and Special Assistant United States Attorney Jorge Almonte of the Tax Division are in charge of the prosecution.
Berks County Man Pleads Guilty to Participating in Multi-County Drug ConspiracyRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a Reading man pleaded guilty today before U.S. District Court Judge Robert D. Mariani to participating in a drug conspiracy that was responsible for distributing large quantities of heroin, cocaine, crack cocaine and other drugs during a four-year time period in Monroe, Carbon, Montgomery and Berks Counties in Pennsylvania.
According to United States Attorney Peter Smith, the defendant, Juan Mendez-Lazaro, age 34, admitted to participating in the conspiracy from 2011 through 2013. The conspiracy was responsible for distributing more than one kilogram of heroin, more than five kilograms of cocaine, and various quantities of crack cocaine, methamphetamine, fentanyl, and Oxycontin (Oxycodone). Mendez-Lazaro is the fifth defendant in the case to plead guilty in federal court.
The charge against Mendez-Lazaro resulted from an investigation by the Drug Enforcement Administration (DEA), U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI), the Pennsylvania State Police, Berks County Detectives and Montgomery County Detectives.
Mendez-Lazaro faces a mandatory minimum 10-year prison sentence and a potential maximum sentence of life in prison. Judge Mariani ordered a pre-sentence report to be completed. Sentencing is scheduled to take place in September 2014.
The case is being prosecuted by Assistant U.S. Attorney Francis P. Sempa.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
Bank Robber Pleads Guilty to A Series of Robberies in 2013Read the Press Release
Committed at least five Bank Robberies Between June 7 and June 24, 2013
Greenbelt, Maryland – Dallas Eric Dunmore, age 47, of Washington, D.C., pleaded guilty today to bank robbery.Co-conspirators Derrick Hart, age 42, of District Heights, Maryland, and Teddy McCain, age 54, of Germantown, Maryland, pleaded guilty on June 19, 2014, to the same charge.
The guilty pleas were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Assistant Director in Charge Valerie Parlave of the Federal Bureau of Investigation’s Washington Field Office; Chief Mark A. Magaw of the Prince George’s County Police Department; Chief J. Thomas Manger of the Montgomery County Police Department; and Maryland Attorney General Douglas F. Gansler.
According to the defendants’ plea agreements, Dallas Dunmore, Hart and McCain robbed or attempted to rob banks in Maryland and Virginia. In each robbery Dallas Dunmore entered the bank and handed the teller a note demanding money. On one occasion, the note also stated that he had a gun, while on two other occasions Dunmore told the teller that he or another conspirator had a gun. McCain waited outside during each robbery. Hart also waited outside during the robberies, except on June 19, 2013, when Hart entered the bank with Dallas Dunmore and another conspirator.The total proceeds from the five robberies in which Dunmore participated are $5,370; and the total proceeds from the six robberies in which Hart and McCain participated are $8,437.
Dunmore, Hart and McCain each face a maximum sentence of 20 years in prison for bank robbery. U.S. District Judge Paul W. Grimm has scheduled sentencing for Dunmore on December 17, 2014 at 9:00 a.m. McCain is scheduled to be sentence on September 29, 2014 at 1:00 p.m. and Hart is scheduled to be sentenced on October 20, 2014 at 10:30 a.m.
United States Attorney Rod J. Rosenstein praised the FBI; Prince George’s and Montgomery County Police Departments; the Arlington, Fairfax, and Alexandria, Virginia Police Departments; and the Maryland Attorney General’s Office, for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Nicolas Mitchell and Special Assistant United States Attorney Gerald A. A. Collins, a cross designated Maryland Assistant Attorney General, who are prosecuting the case.Baltimore Man Sentenced to over 5 Years in Prison for Dozens of Commercial BurglariesRead the Press Release
Robbed Businesses in Maryland, Virginia, West Virginia and Pennsylvania
Baltimore, Maryland – U.S. District Judge J. Frederick Motz sentenced Carl Paschall, Jr., age 32, of Baltimore, today to 66 months in prison followed by three years of supervised release for conspiring to commit bank larceny and interstate transportation of stolen goods. Judge Motz also entered an order that Paschall pay $200,000 in restitution.The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Assistant Special Agent in Charge Gary Tuggle of the Drug Enforcement Administration, Baltimore District Office; Howard County Police Chief William McMahon; Chief James W. Johnson of the Baltimore County Police Department; Anne Arundel County Police Chief Kevin Davis; Special Acting Special Agent in Charge William P. McMullan of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; Special Agent in Charge Nicholas DiGiulio, Office of Investigations, Office of Inspector General of the Department of Health and Human Services; Otis E. Harris, Jr., Special Agent in Charge, Coast Guard Investigative Service, Chesapeake Region; and Commissioner Anthony W. Batts of the Baltimore Police Department..
According to his plea agreement, from at least November 2010 until his arrest in July 2013, Carl Paschall conspired with Michael Johnson, Thomas Ellis and others to commit commercial burglaries in Maryland, Virginia, West Virginia, and Pennsylvania. The conspirators stole cash, money orders, stamps, silver bars, jewelry, cigarettes, lottery tickets, prescription drugs, food, beverages, safes, laptop computers, cell phones, electronics, vehicles and other valuable items from gas stations, convenience stores, banks, credit unions and other commercial establishments during the night. The conspirators often stole or attempted to steal cash from ATMs.
The conspirators usually cut power lines, telephone lines, cables and other wires before entering a business. They used vise grips, sledgehammers, chop saws, grinders and blow torches to enter the business, and then often waited – for several minutes or sometimes up to several hours – before ransacking the business of its valuable items.
Carl Paschall, Jr. admitted that he committed, or attempted to commit, dozens of commercial burglaries and that the loss resulting from these burglaries exceeded $800,000.
On May 26, 2012, Carl Paschall, Jr. stole a van from a car rental agency in West Virginia and used the van during the burglaries. On May 31, 2012, the conspirators drove the van to Newport Road in Woodbine, Maryland and park the vehicle on the side of the road. The conspirators left some evidence of their crimes inside the stolen van, including stolen safes and lottery tickets. The applied an ignitable fluid inside the vehicle and set it on fire. Early in the morning on June 1, 2012, Howard County Fire and Rescue Department responded to the scene and encountered the van fully engulfed in flames.
Michael Johnson, age 25, and Thomas Daniel Ellis, age 24, both of Baltimore, previously pleaded guilty to their participation in the conspiracy. Ellis was sentenced to a year and a day in prison. Johnson was sentenced to three years of probation.United States Attorney Rod J. Rosenstein commended the DEA, Howard County Police Department, Baltimore County Police Department; Anne Arundel County Department, ATF, Department of Health and Human Services - Office of Inspector General; Coast Guard Investigative Service and Baltimore Police Department for their work in the investigation. Mr. Rosenstein also praised the many local and state agencies in Virginia, West Virginia and Pennsylvania for their assistance in the investigation.
Mr. Rosenstein thanked Assistant United States Attorneys David I. Sharfstein and Andrea L. Smith, who are prosecuting this case.
BNP Paribas Agrees to Plead Guilty and to Pay $8.9 Billion for Illegally Processing Financial Transactions for Countries Subject to U.S. Economic SanctionsRead the Press Release
According to court documents submitted today, BNP Paribas S.A. (BNPP), a global financial institution headquartered in Paris, agreed to enter a guilty plea to conspiring to violate the International Emergency Economic Powers Act (IEEPA) and the Trading with the Enemy Act (TWEA) by processing billions of dollars of transactions through the U.S. financial system on behalf of Sudanese, Iranian, and Cuban entities subject to U.S. economic sanctions. The agreement by the French bank to plead guilty is the first time a global bank has agreed to plead guilty to large-scale, systematic violations of U.S. economic sanctions.
The announcement was made by Attorney General Eric H. Holder, Deputy Attorney General James M. Cole, Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Preet Bharara for the Southern District of New York, FBI Director James B. Comey, Chief Richard Weber of the Internal Revenue Service Criminal Investigation (IRS-CI) and District Attorney Cyrus R. Vance Jr. of New York County.
“BNP Paribas went to elaborate lengths to conceal prohibited transactions, cover its tracks, and deceive U.S. authorities. These actions represent a serious breach of U.S. law,” Attorney General Holder said. “Sanctions are a key tool in protecting U.S. national security interests, but they only work if they are strictly enforced. If sanctions are to have teeth, violations must be punished. Banks thinking about conducting business in violation of U.S. sanctions should think twice because the Justice Department will not look the other way.”
“BNP ignored US sanctions laws and concealed its tracks. And when contacted by law enforcement it chose not to fully cooperate,” Deputy Attorney General Cole said. “This failure to cooperate had a real effect -- it significantly impacted the government’s ability to bring charges against responsible individuals, sanctioned entities and satellite banks. This failure together with BNP’s prolonged misconduct mandated the criminal plea and the nearly $9 billion penalty that we are announcing today.”
“By providing dollar clearing services to individuals and entities associated with Sudan, Iran, and Cuba – in clear violation of U.S. law – BNPP helped them gain illegal access to the U.S. financial system,” said Assistant Attorney General Caldwell. “In doing so, BNPP deliberately disregarded U.S. law of which it was well aware, and placed its financial network at the services of rogue nations, all to improve its bottom line. Remarkably, BNPP continued to engage in this criminal conduct even after being told by its own lawyers that what it was doing was illegal.”
“BNPP banked on never being held to account for its criminal support of countries and entities engaged in acts of terrorism and other atrocities,” said U.S. Attorney Bharara. “But that is exactly what we do today. BNPP, the world's fourth largest bank, has agreed to plead guilty and pay penalties of almost $9 billion for performing the hat trick of sanctions violations, unlawfully opening the doors of the U.S. financial markets to three sanctioned countries, Sudan, Iran, and Cuba. For years, BNPP provided access to billions of dollars to these sanctioned countries, as well as to individuals and groups specifically identified and designated by the U.S. government as being subject to sanctions. The bank did so deliberately and secretly, in ways designed to evade detection by the U.S. authorities. For its years-long and wide-ranging criminal conduct, BNPP will soon plead guilty in a federal courthouse in Manhattan.”
According to documents released publicly today, over the course of eight years, BNPP knowingly and willfully moved more than $8.8 billion through the U.S. financial system on behalf of sanctioned entities, including more than $4.3 billion in transactions involving entities that were specifically designated by the U.S. Government as being cut off from the U.S. financial system. BNPP engaged in this criminal conduct through various sophisticated schemes designed to conceal from U.S. regulators the true nature of the illicit transactions. BNPP routed illegal payments through third party financial institutions to conceal not only the involvement of the sanctioned entities but also BNPP’s role in facilitating the transactions. BNPP instructed other financial institutions not to mention the names of sanctioned entities in payments sent through the United States and removed references to sanctioned entities from payment messages to enable the funds to pass through the U.S. financial system undetected.
“The significant financial penalties imposed on BNP Paribas sends a powerful deterrent message to any company that places its profits ahead of its adherence to the law,” said FBI Director James Comey. “We will continue to work closely with our federal and state partners to ensure compliance with U.S. banking laws to promote integrity across financial institutions and to safeguard our national security.”
“Today’s outcome is a testament to U.S. efforts to stem the exploitation of the American financial system and ensure that if you chose to do business in our country you must abide by our laws,” said IRS-CI Chief Weber. “BNP Paribas will forfeit the historic figure of almost $8.9 Billion representing the proceeds of criminal activity. BNPP had many opportunities to take corrective action and abide by the law, and yet, despite warnings from American regulators and other banks, consciously chose to ignore those warnings and commit literally thousands of flagrant violations. IRS-CI, and our domestic and international law enforcement partners, will continue to pursue these cases and follow the money trail – wherever it may lead.”
“The most important values in the international community – respect for human rights, peaceful coexistence, and a world free of terror – significantly depend upon the effectiveness of international sanctions,” said District Attorney Vance. “Today’s guilty plea marks the seventh major case involving sanctions violations by a large international bank that my Office has pursued and resolved since 2009. These cases are critically important for international public safety and the security of our banking system, which is put at risk when it is used to further criminal activity. The seven investigations have revealed a series of widespread schemes to falsify the business records of financial institutions in Manhattan and have resulted in the forfeiture of approximately $12 billion in total. But, more importantly, they have resulted in a fundamental change in the way all banks conduct their business, have heightened vigilance worldwide with respect to dealing with sanctioned entities, and have increased the integrity of our Manhattan-based financial institutions.”
BNPP will waive indictment and be charged in a one-count felony criminal information, filed in federal court in the Southern District of New York, charging BNPP with knowingly and willfully conspiring to commit violations of IEEPA and TWEA, from 2004 through 2012. BNPP has agreed to plead guilty to the information, has entered into a written plea agreement, and has accepted responsibility for its criminal conduct. BNPP is scheduled to formally enter its guilty plea before United States District Judge Lorna Schofield on July 9, 2014 at 4:30 p.m.
The plea agreement, subject to approval by the court, provides that BNPP will pay total financial penalties of $8.9736 billion, including forfeiture of $8.8336 billion and a fine of $140 million.
In addition to the joint forfeiture judgment, the New York County District Attorney’s Office is also announcing today that BNPP has pleaded guilty in New York State Supreme Court to falsifying business records and conspiring to falsify business records. In addition, the Board of Governors of the Federal Reserve System is announcing that BNPP has agreed to a cease and desist order, to take certain remedial steps to ensure its compliance with U.S. law in its ongoing operations, and to pay a civil monetary penalty of $508 million. The New York State Department of Financial Services (DFS) is announcing BNPP has agreed to, among other things, terminate or separate from the bank 13 employees, including the Group Chief Operating Officer and other senior executives; suspend U.S. dollar clearing operations through its New York Branch and other affiliates for one year for business lines on which the misconduct centered; extend for two years the term of a monitorship put in place in 2013, and pay a monetary penalty to DFS of $2.2434 billion. In satisfying its criminal forfeiture penalty, BNPP will receive credit for payments it is making in connection with its resolution of these related state and regulatory matters. The Treasury Department’s Office of Foreign Assets Control has also levied a fine of $963 million, which will be satisfied by payments made to the Department of Justice.
According to documents released publicly today, including a detailed statement of facts admitted to by BNPP, BNPP has acknowledged that, from at least 2004 through 2012, it knowingly and willfully moved over $8.8 billion through the U.S. financial system on behalf of Sudanese, Iranian and Cuban sanctioned entities, in violation of U.S. economic sanctions. The majority of illegal payments were made on behalf of sanctioned entities in Sudan, which was subject to U.S. embargo based on the Sudanese government’s role in facilitating terrorism and committing human rights abuses. BNPP processed approximately $6.4 billion through the United States on behalf of Sudanese sanctioned entities from July 2006 through June 2007, including approximately $4 billion on behalf of a financial institution owned by the government of Sudan, even as internal emails showed BNPP employees expressing concern about the bank’s assisting the Sudanese government in light of its role in supporting international terrorism and committing human rights abuses during the same time period. Indeed, in March 2007, a senior compliance officer at BNPP wrote to other high-level BNPP compliance and legal employees reminding them that certain Sudanese banks with which BNPP dealt “play a pivotal part in the support of the Sudanese government which . . . has hosted Osama Bin Laden and refuses the United Nations intervention in Darfur.”
One way in which BNPP processed illegal transactions on behalf of Sudanese sanctioned entities was through a sophisticated system of “satellite banks” set up to disguise both BNPP’s and the sanctioned entities’ roles in the payments to and from financial institutions in the United States. As early as August 2005, a senior compliance officer at BNPP warned several legal, business and compliance personnel at BNPP’s subsidiary in Geneva that the satellite bank system was being used to evade U.S. sanctions: “As I understand it, we have a number of Arab Banks (nine identified) on our books that only carry out clearing transactions for Sudanese banks in dollars. . . . This practice effectively means that we are circumventing the US embargo on transactions in USD by Sudan.”
Similarly, BNPP provided Cuban sanctioned entities with access to the U.S. financial system by hiding the Cuban sanctioned entities’ involvement in payment messages. From October 2004 through early 2010, BNPP knowingly and willfully processed approximately $1.747 billion on behalf of Cuban sanctioned entities. In the statement of facts, BNPP admitted that it continued to do U.S. dollar business with Cuba long after it was clear that such business was illegal in order to preserve BNPP’s business relationships with Cuban entities. BNPP further admitted that its conduct with regard to the Cuban embargo was both “cavalier” and “criminal,” as evidenced by the bank’s 2006 decision, after certain Cuban payments were blocked when they reached the United States, to strip the wire messages for those payments of references to Cuban entities and resubmit them as a lump sum in order to conceal from U.S. regulators the bank’s longstanding, and illicit, Cuban business.
Further according to court documents, BNPP engaged in more than $650 million of transactions involving entities tied to Iran, and this conduct continued into 2012 – nearly two years after the bank had commenced an internal investigation into its sanctions compliance and had pledged to cooperate with the Government. The illicit Iranian transactions were done on behalf of BNPP clients, including a petroleum company based in Dubai that was effectively a front for an Iranian petroleum company, and an Iranian oil company.
This case was investigated by the IRS-Criminal Investigation’s Washington Field Division and FBI’s New York Field Office. This case is being prosecuted by the Money Laundering and Bank Integrity Unit of the Criminal Division’s Asset Forfeiture and Money Laundering Section (AFMLS), and the Money Laundering and Asset Forfeiture Unit of the U.S. Attorney’s Office for the Southern District of New York. Trial Attorneys Craig Timm and Jennifer E. Ambuehl of AFMLS and Assistant United States Attorneys Andrew D. Goldstein, Martin S. Bell, Christine I. Magdo and Micah W.J. Smith of the Southern District of New York are in charge of the prosecution.
The New York County District Attorney’s Office also conducted its own investigation alongside with the Department of Justice on this investigation. The Department of Justice expressed its gratitude to the Board of Governors of the Federal Reserve, the Federal Reserve Bank of New York, the New York State Department of Financial Services and the Treasury Department’s Office of Foreign Assets Control for their assistance with this matter.
Documents associated with this press release are available at: http://www.justice.gov/opa/bnp-paribas.htmlBNP Paribas Agrees to Plead Guilty to Conspiring to Process Transactions Through the U.S. Financial System for Sudanese, Iranian, and Cuban Entities Subject to U.S. Economic SanctionsRead the Press Release
BNP Paribas Will Pay Total Financial Penalties In Excess Of $8.9 Billion
Attorney General Eric H. Holder, Deputy Attorney General James M. Cole, Criminal Division Assistant Attorney General Leslie Caldwell, United States Attorney for the Southern District of New York Preet Bharara, Internal Revenue Service Criminal Investigation Chief Richard Weber, Federal Bureau of Investigation Director James B. Comey, and District Attorney Cyrus R. Vance Jr. of New York County announced that BNP Paribas S.A. (BNPP), a global financial institution headquartered in Paris, has agreed to plead guilty to conspiring to violate the International Emergency Economic Powers Act (IEEPA) and the Trading with the Enemy Act (TWEA) by processing billions of dollars of U.S. dollar transactions through the U.S. financial system on behalf of Sudanese, Iranian, and Cuban entities subject to U.S. economic sanctions. The agreement by the French bank to plead guilty is the first time a financial institution has agreed to plead guilty based on large-scale, systematic violations of U.S. economic sanctions.
Attorney General Holder said: “BNP Paribas went to elaborate lengths to conceal prohibited transactions, cover its tracks, and deceive U.S. authorities. These actions represent a serious breach of U.S. law. Sanctions are a key tool in protecting U.S. national security interests, but they only work if they are strictly enforced. If sanctions are to have teeth, violations must be punished. Banks thinking about conducting business in violation of U.S. sanctions should think twice because the Justice Department will not look the other way.”
Deputy Attorney General Cole said: “BNP ignored US sanctions laws and concealed its tracks. And when contacted by law enforcement it chose not to fully cooperate. This failure to cooperate had a real effect -- it significantly impacted the government’s ability to bring charges against responsible individuals, sanctioned entities and satellite banks. This failure together with BNP’s prolonged misconduct mandated the criminal plea and the nearly $9 billion penalty that we are announcing today.”
Assistant Attorney General Caldwell said: “By providing dollar clearing services to individuals and entities associated with Sudan, Iran, and Cuba – in clear violation of U.S. law – BNPP helped them gain illegal access to the U.S. financial system. In doing so, BNPP deliberately disregarded U.S. law of which it was well aware, and placed its financial network at the services of rogue nations, all to improve its bottom line. Remarkably, BNPP continued to engage in this criminal conduct even after being told by its own lawyers that what it was doing was illegal.”
U.S. Attorney Preet Bharara said: "BNPP banked on never being held to account for its criminal support of countries and entities engaged in acts of terrorism and other atrocities. But that is exactly what we do today. BNPP, the world's fourth largest bank, has agreed to plead guilty and pay penalties of almost $9 billion for performing the hat trick of sanctions violations, unlawfully opening the doors of the U.S. financial markets to three sanctioned countries, Sudan, Iran, and Cuba. For years, BNPP provided access to billions of dollars to these sanctioned countries, as well as to individuals and groups specifically identified and designated by the U.S. government as being subject to sanctions. The bank did so deliberately and secretly, in ways designed to evade detection by the U.S. authorities. For its years-long and wide-ranging criminal conduct, BNPP will soon plead guilty in a federal courthouse in Manhattan."
According to documents released publicly today, over the course of eight years, BNPP knowingly and willfully moved more than $8.8 billion through the U.S. financial system on behalf of sanctioned entities, including more than $4.3 billion in transactions involving entities that were specifically designated by the U.S. Government as being cut off from the U.S. financial system. BNPP engaged in this criminal conduct through various sophisticated schemes designed to conceal from U.S. regulators the true nature of the illicit transactions. BNPP routed illegal payments through third party financial institutions to conceal not only the involvement of the sanctioned entities but also BNPP’s role in facilitating the transactions. BNPP instructed other financial institutions not to mention the names of sanctioned entities in payments sent through the United States and removed references to sanctioned entities from payment messages to enable the funds to pass through the U.S. financial system undetected.
FBI Director James Comey said: “The significant financial penalties imposed on BNP Paribas sends a powerful deterrent message to any company that places its profits ahead of its adherence to the law. We will continue to work closely with our federal and state partners to ensure compliance with U.S. banking laws to promote integrity across financial institutions and to safeguard our national security.”
IRS-CI Chief Weber said: “Today’s outcome is a testament to U.S. efforts to stem the exploitation of the American financial system and ensure that if you chose to do business in our country you must abide by our laws. BNP Paribas will forfeit the historic figure of almost $8.9 Billion representing the proceeds of criminal activity. BNPP had many opportunities to take corrective action and abide by the law, and yet, despite warnings from American regulators and other banks, consciously chose to ignore those warnings and commit literally thousands of flagrant violations. IRS-CI, and our domestic and international law enforcement partners, will continue to pursue these cases and follow the money trail – wherever it may lead.”
District Attorney Vance said: “The most important values in the international community – respect for human rights, peaceful coexistence, and a world free of terror – significantly depend upon the effectiveness of international sanctions. Today’s guilty plea marks the seventh major case involving sanctions violations by a large international bank that my Office has pursued and resolved since 2009. These cases are critically important for international public safety and the security of our banking system, which is put at risk when it is used to further criminal activity. The seven investigations have revealed a series of widespread schemes to falsify the business records of financial institutions in Manhattan and have resulted in the forfeiture of approximately $12 billion in total. But, more importantly, they have resulted in a fundamental change in the way all banks conduct their business, have heightened vigilance worldwide with respect to dealing with sanctioned entities, and have increased the integrity of our Manhattan-based financial institutions.”
BNPP will waive indictment and be charged in a one-count felony criminal information, filed in federal court in the Southern District of New York, charging BNPP with knowingly and willfully conspiring to commit violations of IEEPA and TWEA, from 2004 through 2012. BNPP has agreed to plead guilty to the information, has entered into a written plea agreement, and has accepted responsibility for its criminal conduct. BNPP is scheduled to formally enter its guilty plea before United States District Judge Lorna Schofield on July 9, 2014 at 4:30 p.m.
The plea agreement, subject to approval by the court, provides that BNPP will pay total financial penalties of $8.9736 billion, including forfeiture of $8.8336 billion and a fine of $140 million.
In addition to the joint forfeiture judgment, the New York County District Attorney’s Office is also announcing today that BNPP has pleaded guilty in New York State Supreme Court to falsifying business records and conspiring to falsify business records. In addition, the Board of Governors of the Federal Reserve System is announcing that BNPP has agreed to a cease and desist order, to take certain remedial steps to ensure its compliance with U.S. law in its ongoing operations, and to pay a civil monetary penalty of $508 million. The New York State Department of Financial Services (DFS) is announcing BNPP has agreed to, among other things, terminate or separate from the bank 13 employees, including the Group Chief Operating Officer and other senior executives; suspend U.S. dollar clearing operations through its New York Branch and other affiliates for one year for business lines on which the misconduct centered; extend for two years the term of a monitorship put in place in 2013, and pay a monetary penalty to DFS of $2.2434 billion. In satisfying its criminal forfeiture penalty, BNPP will receive credit for payments it is making in connection with its resolution of these related state and regulatory matters. The Treasury Department’s Office of Foreign Assets Control has also levied a fine of $963 million, which will be satisfied by payments made to the Department of Justice.
According to documents released publicly today, including a detailed statement of facts admitted to by BNPP, BNPP has acknowledged that, from at least 2004 through 2012, it knowingly and willfully moved over $8.8 billion through the U.S. financial system on behalf of Sudanese, Iranian and Cuban sanctioned entities, in violation of U.S. economic sanctions.
The majority of illegal payments were made on behalf of sanctioned entities in Sudan, which was subject to U.S. embargo based on the Sudanese government’s role in facilitating terrorism and committing human rights abuses. BNPP processed approximately $6.4 billion through the United States on behalf of Sudanese sanctioned entities from July 2006 through June 2007, including approximately $4 billion on behalf of a financial institution owned by the government of Sudan, even as internal emails showed BNPP employees expressing concern about the bank’s assisting the Sudanese government in light of its role in supporting international terrorism and committing human rights abuses during the same time period. Indeed, in March 2007, a senior compliance officer at BNPP wrote to other high-level BNPP compliance and legal employees reminding them that certain Sudanese banks with which BNPP dealt “play a pivotal part in the support of the Sudanese government which . . . has hosted Osama Bin Laden and refuses the United Nations intervention in Darfur.”
One way in which BNPP processed illegal transactions on behalf of Sudanese sanctioned entities was through a sophisticated system of “satellite banks” set up to disguise both BNPP’s and the sanctioned entities’ roles in the payments to and from financial institutions in the United States. As early as August 2005, a senior compliance officer at BNPP warned several legal, business and compliance personnel at BNPP’s subsidiary in Geneva that the satellite bank system was being used to evade U.S. sanctions: “As I understand it, we have a number of Arab Banks (nine identified) on our books that only carry out clearing transactions for Sudanese banks in dollars. . . . This practice effectively means that we are circumventing the US embargo on transactions in USD by Sudan.”
Similarly, BNPP provided Cuban sanctioned entities with access to the U.S. financial system by hiding the Cuban sanctioned entities’ involvement in payment messages. From October 2004 through early 2010, BNPP knowingly and willfully processed approximately $1.747 billion on behalf of Cuban sanctioned entities. In the statement of facts, BNPP admitted that it continued to do U.S. dollar business with Cuba long after it was clear that such business was illegal in order to preserve BNPP’s business relationships with Cuban entities. BNPP further admitted that its conduct with regard to the Cuban embargo was both “cavalier” and “criminal,” as evidenced by the bank’s 2006 decision, after certain Cuban payments were blocked when they reached the United States, to strip the wire messages for those payments of references to Cuban entities and resubmit them as a lump sum in order to conceal from U.S. regulators the bank’s longstanding, and illicit, Cuban business.
Further according to court documents, BNPP engaged in more than $650 million of transactions involving entities tied to Iran, and this conduct continued into 2012 – nearly two years after the bank had commenced an internal investigation into its sanctions compliance and had pledged to cooperate with the Government. The illicit Iranian transactions were done on behalf of BNPP clients, including a petroleum company based in Dubai that was effectively a front for an Iranian petroleum company, and an Iranian oil company.
This case was investigated by the IRS-Criminal Investigation’s Washington Field Division and the FBI’s New York Field Office. This case is being prosecuted by the Money Laundering and Bank Integrity Unit of the Criminal Division’s Asset Forfeiture and Money Laundering Section (AFMLS), and the Money Laundering and Asset Forfeiture Unit of the U.S. Attorney’s Office for the Southern District of New York. Trial Attorneys Craig Timm and Jennifer E. Ambuehl of AFMLS and Assistant United States Attorneys Andrew D. Goldstein, Martin S. Bell, Christine I. Magdo, and Micah W.J. Smith of the Southern District of New York are in charge of the prosecution.
The New York County District Attorney’s Office also conducted its own investigation alongside with the Department of Justice on this investigation. The Department of Justice expressed its gratitude to the Board of Governors of the Federal Reserve, the Federal Reserve Bank of New York, the New York State Department of Financial Services and the Treasury Department’s Office of Foreign Assets Control for their assistance with this matter.
BNP Paribas Information
BNP Paribas Statement of Facts
BNP Paribas Notice of Intent
BNP Paribas Plea Agreement
BNP Paribas Consent Preliminary Order of ForfeitureAlabama Woman Sentenced to Probation for Helping Friend Conceal Money from the IRSRead the Press Release
JOHNSTOWN, Pa. – An Alabama resident has been sentenced in federal court to one year probation on her conviction of conspiracy, United States Attorney David J. Hickton announced today.
United States District Judge Kim R. Gibson imposed the sentence on Linda Reed, 70, of Florala, Al.
According to information presented to the court, from June 9, 2007, to April 15, 2008, Reed conspired with others to defraud the United States by assisting a co-conspirator in concealing money from the Internal Revenue Service in order for the co-conspirator to avoid paying income tax.
Assistant United States Attorney Stephanie L. Haines prosecuted this case on behalf of the government.
Mr. Hickton commended the Laurel Highlands Resident Agency of the Federal Bureau of Investigation and the Internal Revenue Service Criminal Investigation for the investigation leading to the successful prosecution of Reed.
10 Arrested for Illegal Gun SalesRead the Press Release
Montgomery, Alabama - Ten people were arrested for illegal gun sales that took place at Sadie’s Flea Market in Dothan, Alabama, announced U.S. Attorney George L. Beck Jr. for the Middle District of Alabama and Special Agent in Charge Jeff Fulton of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF).
According to court documents, all of those arrested had rented booths at Sadie’s Flea Market and engaged in the sale of firearms. It is alleged that nine of the ten arrested sold guns to individuals they knew had been convicted of a felony. Four were also charged with selling firearms without a license. Court records indicate that some of those charged with illegal gun sales had been convicted of a felony themselves, which prohibited them from even possessing a firearm. Under federal law, it is illegal to possess a gun if you have been convicted of a felony, and also to sell a gun to someone you know has been convicted of a felony. As a result of this investigation, ATF agents seized over 200 firearms and over 5000 rounds of live ammunition.
The following people were arrested:
- RICHARD ALLEN COHEN, 65 years old, of Graceville, Florida is charged with selling a firearm to a convicted felon.
- ROBERT ARTHUR CHUDZIK III, 27 years old, of Headland, Alabama is charged with selling a firearm to a convicted felon.
- WILLIAM DEAN, 84 years old, of Whigham, Georgia is charged with selling a firearm to a convicted felon.
- CHARLES T. GRIMES, 56 years old, of Opp, Alabama is charged with selling a firearm to a convicted felon, dealing firearms without a license.
- THOMAS P. KNOWLES, 47 years old, of Chancellor, Alabama is charged with selling a firearm to a convicted felon.
- MARVIN T. JONES, 70 years old, of Dothan, Alabama is charged with selling a firearm to a convicted felon, possession of a firearm by a convicted felon, and dealing in firearms without a license.
- DAVID R. LOFTIN, 64 years old, of Lagrange, Georgia is charged with selling a firearm to a convicted felon, and dealing firearms without a license.
- RONALD D. SLOAN, 64 years old, Cottondale, Florida is charged with selling a firearm to a convicted felon.
- CHARLES P. SLY, 75 years old, of Slocomb, Alabama is charged with selling a firearm to a convicted felon, possession of firearm by convicted felon, and dealing firearms without a license.
- BRENT E. UNDERWOOD, 60 years old, of Coffee Springs, Alabama is charged with selling a firearm to an out-of-state resident.
“ATF’s ‘Frontline’ strategy to reduce violent crime includes the investigation of those individuals who sell firearms to prohibited persons,” stated ATF Special Agent in Charge Jeff Fulton. “This investigation demonstrates the continued dedication to provide a safe environment for the public”
An indictment merely alleges that crimes have been committed and the defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted Cohen, Chudzick, Dean, Grimes, Knowles, Jones, Loftin, Sloan, and Sly face a prison term of up to ten years, a fine of not more than $250,000 and a term of supervised release of not more than three years. Underwood faces a prison term of not more than five years, a $250,000 maximum fine and a term of supervise release of not more than three years.
This case was investigated by the Bureau of Alcohol, Tobacco and Firearms and the Chipley, Florida Police Department. This case is being prosecuted by Assistant United States Attorney Susan R. Redmond.
PRESS CONTACT: Clark Morris
Email: [email protected]
Telephone: (334) 551-1755
Fax: (334) 223-7617
Sunday 29 June 2014
Ahmed Abu Khatallah Indicted for Terrorist Conspiracy Stemming from September 2012 Attack in Benghazi, LibyaRead the Press Release
Defendant Makes Initial Court Appearance TodayWASHINGTON - Ahmed Abu Khatallah, aka Ahmed Mukatallah, made his first appearance today in the U.S. District Court for the District of Columbia on a federal terrorism offense arising from his alleged participation in the September 11-12, 2012, terrorist attacks in Benghazi, Libya, which resulted in the deaths of Ambassador J. Christopher Stevens, Sean Smith, Tyrone Woods and Glen Doherty.
Khatallah was indicted by a federal grand jury on the charge of conspiracy to provide material support and resources to terrorists, knowing and intending that these would be used in preparation for and in carrying out a killing in the course of an attack on a federal facility, and the offense resulted in death.
The investigation is ongoing and the Justice Department can bring additional charges as the case continues.
"Now that Ahmed Abu Khattalah has arrived in the United States, he will face the full weight of our justice system," said Eric Holder, U.S. Attorney General. "We will prove, beyond a reasonable doubt, the defendant’s alleged role in the attack that killed four brave Americans in Benghazi."
"Capturing Ahmed Abu Khattalah and bringing him to the U.S. to face justice for his role in killing American citizens in Benghazi is a major step forward in our ongoing investigation," said FBI Director James B. Comey. "Our work, however, is not over. This case remains one of our top priorities and we will continue to pursue all others who participated in this brazen attack on our citizens and our country."
"Ahmed Abu Khatallah's capture and his appearance in court today were critical steps toward bringing him to justice for his role in the terrorist attacks on our diplomatic facilities in Benghazi," said John Carlin, Assistant Attorney General for National Security. "We will not rest in our pursuit of the others who attacked our facilities and killed the four courageous Americans who perished that day."
"In a courtroom in our nation's capital, today we took the first step down the road to justice for the four American heroes killed in Benghazi," said Ronald C. Machen Jr., U.S. Attorney for the District of Columbia. "This prosecution is a reflection of our determination to honor the sacrifice of U.S. citizens who perish on foreign soil in service to our country. We will be steady, deliberate, and relentless in seeking to hold accountable all who were responsible for this deadly act of terror."
"The capture and return to the United States of Ahmed Abu Khatallah should be a warning to all those who want to harm the United States," said George Venizelos, Assistant Director in Charge of the FBI’s New York Field Office. "As alleged in the indictment, Khatallah participated in September 11-12, 2012, terrorist attacks in Benghazi, Libya which resulted in the deaths of four innocent Americans. Now he is in the United States to stand trial for his actions. The FBI will continue to pursue and bring to justice those who conduct such heinous acts no matter where they are located."
Khatallah, a Libyan national approximately 43 years of age, was taken into custody earlier this month. He initially was charged in a criminal complaint that was filed under seal on July 15, 2013 and that became public on June 17, 2014. The Justice Department secured the defendant’s initial indictment on June 26, 2014, and the charging document was unsealed today.
An indictment is merely a formal allegation that a defendant has committed a violation of criminal laws and every defendant is presumed innocent until, and unless, proven guilty.
The case is being investigated by the FBI New York Office's Joint Terrorism Task Force with substantial assistance from various other government agencies. The case is being prosecuted by the U.S. Attorney’s Office for the District of Columbia and the Counterterrorism Section of the Justice Department’s National Security Division.
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Saturday 28 June 2014
Ahmed Abu Khatallah Indicted for Terrorist Conspiracy Stemming from September 2012 Attack in Benghazi, LibyaRead the Press Release
Ahmed Abu Khatallah, aka Ahmed Mukatallah, made his first appearance today in the U.S. District Court for the District of Columbia on a federal terrorism offense arising from his alleged participation in the Sept. 11 through 12, 2012, terrorist attacks in Benghazi, Libya, which resulted in the deaths of Ambassador J. Christopher Stevens, Sean Smith, Tyrone Woods and Glen Doherty.
Khatallah was indicted by a federal grand jury on the charge of conspiracy to provide material support and resources to terrorists, knowing and intending that these would be used in preparation for and in carrying out a killing in the course of an attack on a federal facility, and the offense resulted in death.
The investigation is ongoing and the Justice Department can bring additional charges as the case continues.
“Now that Ahmed Abu Khatallah has arrived in the United States, he will face the full weight of our justice system,” said U.S. Attorney General Eric Holder. “We will prove, beyond a reasonable doubt, the defendant’s alleged role in the attack that killed four brave Americans in Benghazi.”
“Capturing Ahmed Abu Khatallah and bringing him to the U.S. to face justice for his role in killing American citizens in Benghazi is a major step forward in our ongoing investigation,” said FBI Director James B. Comey. “Our work, however, is not over. This case remains one of our top priorities and we will continue to pursue all others who participated in this brazen attack on our citizens and our country.”
“Ahmed Abu Khatallah's capture and his appearance in court today were critical steps toward bringing him to justice for his role in the terrorist attacks on our diplomatic facilities in Benghazi,” said Assistant Attorney General for National Security John Carlin. “We will not rest in our pursuit of the others who attacked our facilities and killed the four courageous Americans who perished that day.”
“In a courtroom in our nation's capital, today we took the first step down the road to justice for the four American heroes killed in Benghazi,” said U.S. Attorney Ronald C. Machen Jr. for the District of Columbia. “This prosecution is a reflection of our determination to honor the sacrifice of U.S. citizens who perish on foreign soil in service to our country. We will be steady, deliberate and relentless in seeking to hold accountable all who were responsible for this deadly act of terror.”
“The capture and return to the United States of Ahmed Abu Khatallah should be a warning to all those who want to harm the United States,” said Assistant Director in Charge of the FBI’s New York Field Office George Venizelos. “As alleged in the indictment, Khatallah participated in September 11-12, 2012, terrorist attacks in Benghazi, Libya, which resulted in the deaths of four innocent Americans. Now he is in the United States to stand trial for his actions. The FBI will continue to pursue and bring to justice those who conduct such heinous acts no matter where they are located.”
Khatallah, a Libyan national approximately 43 years of age, was taken into custody earlier this month. He initially was charged in a criminal complaint that was filed under seal on July 15, 2013, and that became public on June 17, 2014. The Justice Department secured the defendant’s initial indictment on June 26, 2014, and the charging document was unsealed today.
An indictment is merely a formal allegation that a defendant has committed a violation of criminal laws and every defendant is presumed innocent until, and unless, proven guilty.
The case is being investigated by the FBI New York Office's Joint Terrorism Task Force with substantial assistance from various other government agencies. The case is being prosecuted by the U.S. Attorney’s Office for the District of Columbia and the Counterterrorism Section of the Justice Department’s National Security Division.
Friday 27 June 2014
Week in Review - South BendRead the Press Release
South Bend, Indiana — The United States Attorney’s Office announced the following activity in Federal Court:
PLEAS
- Steven M McCloughan, 57, of Elkhart, Indiana pled guilty to the felony offense of possession and distribution of child pornography. The magistrate is recommending that the district court accept the tendered guilty plea. Parties have 14 days in which to object to the magistrate judge’s recommendation. This charge was filed as a result of an investigation by Federal Bureau of Investigation and United States Secret Service. Sentencing has been set for 9/25/2014. This case is being prosecuted by Assistant United States Attorney John Maciejczyk.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
DISPOSITIONS
- Alvin Blade, III, 22, of South Bend, IN was sentenced to 72 months imprisonment, 2 years supervised release and a $100 Special Assessment after pleading guilty to the felony offense of using a firearm during a drug trafficking crime/crime of violence, where the firearm was discharged. According to documents filed in this case, Javon Thomas and Alvin Blade III agreed and planned to sell ecstasy pills to Jerrell Sanders and his brother William Sanders. A January 21, 2011 meeting for the sale of the ecstasy pills was set and was to occur near the Olive St. convenience store. Instead of the sale, Thomas had decided to rob Jerrell and his brother William. Thomas was armed with a 9mm pistol. In the course of the meeting/confrontation, Blade was also armed with a handgun and shot Jerrell Sanders and also fired at William Sanders. Javon Thomas shot William Sanders. Javon Thomas went through the pockets of the two victims and stole the cash that the Sanders had brought for the planned drug purchase. Blade's participation in this episode included his setting up the drug sale of ecstasy pills with Thomas' concurrence, pulling a handgun, and shooting Jerrell Sanders. This case was the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives, FBI and the South Bend Police Department. This case was prosecuted by Assistant United States Attorney Donald J. Schmid.
- Robert D Carrico, 29, of South Bend, IN was sentenced to 92 months imprisonment, 2 years supervised release and a $100 Special Assessment after pleading guilty to the felony offense of possession of controlled substances with intent to distribute and possession of a firearm in furtherance of federal drug trafficking crimes. According to documents filed in this case, Carrico was distributing ecstasy pills and marijuana in the South Bend area. He was aware that dealing in drugs created a risk that he would be robbed of the drugs he was selling and the money that he was making from his illegal drug trafficking. In order to try and protect himself from such robberies, he armed himself with multiple firearms including a .44 caliber revolver, a .45 caliber pistol, a 9mm pistol, a .380 caliber pistol, an AK-47 assault rifle, two 12 gauge shotguns, a 20 gauge shotgun and a large amount of ammunition for these firearms. On October 23, 2013, four armed men tried to rob Carrico of his drugs and cash. Gunfire was exchanged. Carrico was wounded, one of the intruders was killed and another was wounded. Two women who were at Carrico’s home were also present during the armed home invasion/robbery attempt. Police who investigated the shooting found a kilogram of marijuana, ecstasy pills, other drug trafficking materials, and several thousand dollars cash (along with some of the firearms) in a safe that Carrico kept. When Carrico was arrested on February 14, 2014 on the federal warrant for this case, police found Carrico carrying a loaded .45 caliber Beretta pistol. Police also found a small amount of marijuana and a loaded 12 gauge Hawk shotgun in his home on February 14, 2014. This case was the result of an investigation by Elkhart County Immigration and Customs Enforcement Drug Unit and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. This case was prosecuted by Assistant United States Attorney Donald Schmid.
- David Diederich, 58, of LaPorte, IN was sentenced to 41 months imprisonment, 1 year supervised release and to pay a $1000 fine after pleading guilty to the felony offense of being a felon in possession of a firearm. According to documents filed in this case, on August 23, 2013, Diederich possessed an Empire Ejector shotgun while in LaPorte County, IN. He had been convicted of a felony in St. Joseph County in 1976 in Superior Court. Diederich knew he could not lawfully possess a firearm and he did not dispute that this firearm had traveled through interstate or foreign commerce. This case was the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives. This case was prosecuted by Assistant United States Attorney Frank Schaffer.
- Brian L Baker, 23, of Chicago, IL was sentenced to 75 months imprisonment and 3 years supervised release after pleading guilty to the felony offense of possessing heroin with intent to distribute and possessing a firearm in furtherance of a drug trafficking crime. According to documents filed in this case, the South Bend Police did a traffic stop for no taillight on August 23, 2013 on a vehicle in which the defendant was riding. Brian Baker was the front seat passenger and his girlfriend Stephanie Rodriguez driving; another man, Michael Mason, was in the back seat. Having consent to search the vehicle, the police found a handgun in a purse along with 42 baggies of heroin (approximately 7.1 grams) and three baggies of marijuana (approximately 3.4 grams). Baker had $384 cash in his pocket. Both the handgun – a Taurus pistol, model PT132 Millennium Pro, .32 caliber, Serial No. FCS12041 – and the drugs belonged to and were in the possession of the defendant Brian Baker. The firearm was used to protect the defendant while he was engaged in heroin trafficking. This case was the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the South Bend Police. This case was prosecuted by Assistant United States Attorney Donald Schmid.
Week in Review - HammondRead the Press Release
Hammond, Indiana — The United States Attorney’s Office announced the following activity in Federal Court:
PLEA
- Robert Barker, 28, of Calumet City, Illinois pled guilty to the felony offense of Felon in Possession of a Firearm. This charge was filed as a result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). Sentencing has been set for 9/9/2014. This case is being prosecuted by Assistant United States Attorney Jennifer Chang-Adiga.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
DISPOSITIONS
- Rhonda Murphy, 38, of Gary, Indiana was sentenced to 2 year term of probation to include 6 months home confinement after pleading guilty to the felony offense of tax fraud. According to documents filed in this case, Murphy prepared and filed fraudulent tax returns to obtain grossly inflated refunds for clients. This case was the result of an investigation by the Internal Revenue Service (IRS). This case was prosecuted by Assistant United States Attorney Jill Koster.
- Jeanetta Brown, 33, of Markham, Illinois was sentenced to 2 years probation, with a special condition of 6 months home detention after pleading guilty to the felony offense of making false statements regarding her residence address and state of residence in connection with the purchase of firearms. According to documents filed in this case, on January 31, 2013, Brown purchased two firearms at a federal firearms dealer in Gary, Indiana, and in so doing represented on the firearms paperwork to purchase the firearms that she was living at a residence in East Chicago, Indiana, when in truth and fact she was at that time a resident of Illinois. This case was the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). This case was prosecuted by Assistant United States Attorney Dean Lanter.
- Sandra Hatton Mills, 64, of Lafayette, Indiana was sentenced to a 1 year term of probation to include 6 months of home confinement after pleading guilty to the felony offense of filing a false tax return. According to documents filed in this case, Mills failed to report to the IRS approximately $223,000 in income from her home healthcare business in 2006. Mills also paid her employees wages from which no employment taxes were withheld. Mills failed to report similarly derived income to the IRS in each of 2005 ($12,900 in unreported income), 2006 ($22,300), 2008 ($176,000) and 2009 ($87,600). This case was the result of an investigation by Internal Revenue Service (IRS). This case was prosecuted by Assistant United States Attorney Jill Koster.
- Paul Deshaun Robinson, 23, of Gary, Indiana was sentenced to 2 years probation after pleading guilty to the felony offense of distribution of heroin. According to documents filed in this case, In May 2013, in Gary, Indiana, Robinson distributed heroin to a confidential informant. This case was the result of an investigation by Federal Bureau of Investigation (FBI) GRIT Task Force. This case was prosecuted by Assistant United States Attorney Dean Lanter.
Week in Review - Fort WayneRead the Press Release
Fort Wayne, Indiana — The United States Attorney’s Office announced the following activity in Federal Court:
DISPOSITIONS
- Michael C. Bure, 27, of Fort Wayne, Indiana, was sentenced to 67 months imprisonment; 2 years supervised release and to and pay $2,535 in restitution after pleading guilty to the felony offense of bank robbery. According to documents filed in this case, in 2011, Bure was involved in a bank robbery. Bure aided in planning the robbery and drove the vehicle away from the crime. This case was the result of an investigation by FBI Bank Robbery Task Force and the New Haven Police Department. This case was prosecuted by Assistant United States Attorney Lesley Miller-Lowery.
- Alfred Alcaraz, 34, of Tucson, Arizona was sentenced to 41 months imprisonment; 3 years supervised release after pleading guilty to the felony offense of conspiracy to possess with intent to distribute a controlled substance. According to documents filed in this case, Alcaraz had utilized individuals to send 117 pounds of marijuana from Arizona to Indiana. Through a series of recorded telephone conversations, he agreed to assist an individual living in Ft. Wayne acquire quantities of marijuana for that individual to distribute to others. Alcaraz was to supply the marijuana to the individual living in Ft. Wayne, Indiana. This case was the result of an investigation by the Drug Enforcement Agency, the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Pulaski County Sheriff’s Department, Missouri. This case was prosecuted by Assistant United States Attorney Lesley Miller-Lowery.
- Pedro Salud Rubio-Garcia, 26, of Fremont, Indiana was sentenced to 78 months imprisonment and 4 years supervised release after pleading guilty to the felony offenses of conspiracy to distribute and possess with intent to distribute a controlled substance, distribution of a controlled substance and selling a firearm to a convicted felon. According to documents filed in this case, Rubio-Garcia was involved in the distribution of cocaine, methamphetamine and the trafficking of firearms. This case was the result of an investigation by the Federal Bureau of Investigation Fort Wayne Safe Streets Task Force and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. The Fort Wayne Safe Streets Task Force is comprised of FBI agents and officers from the Indiana State Police, Allen County Police Department, and Fort Wayne Police Department. The New Haven Police Department, Steuben County Sheriff's Department, Elkhart County Interdiction and Covert Enforcement Unit, South Bend Police Department, and IMAGE Drug Task Force assisted with this investigation. This case was prosecuted by Assistant United States Attorney Lesley Miller-Lowery.
- Amanda J. McBride, 32, of Fort Wayne, Indiana was sentenced to 2 years on probation after pleading guilty to the felony offense of maintaining drug-involved premises. According to documents filed in this case, from on or about April 15, 2013, to on or about June 27, 2013, McBride was the owner of a building which others used for crack cocaine distribution. This case was the result of an investigation by the Federal Bureau of Investigation and the Fort Wayne Police Department. This case was prosecuted by Assistant United States Attorney Tony Geller.
Waxahachie Man Sentenced to 41 Months in Federal Prison on Firearms ConvictionsRead the Press Release
Defendant Possessed Firearms, Large Amount of Chemicals, Supplies and Literature for Bomb Making Purposes
DALLAS — A Waxahachie, Texas, man, who was arrested a year ago after law enforcement discovered a firearm, bomb-making chemicals and related literature in his vehicle, was sentenced this morning in federal court in Dallas, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
Clayton Todd Earthman, 25, was sentenced by Chief U.S. District Judge Sidney A. Fitzwater to 41 months in federal prison. He pleaded guilty in March 2014 to one count of possession of a firearm by a prohibited person and one count of possession of an unregistered firearm.
According to documents filed in the case, on the afternoon of June 18, 2013, officers with the Dallas Police Department (DPD) stopped Earthman for committing a traffic violation in the 6600 block of Lovett Avenue in Dallas. Upon removing Earthman from the car, officers located a loaded Glock model 32 .357 pistol from the driver’s side floorboard. Officers also observed several large pieces of PVC pipe, end caps and assorted unknown chemicals in the back seat of the car. Earthman was the sole occupant of the vehicle.
Agents with the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) were contacted, and upon a search of the car, they discovered fuses, handwritten documents, as well as downloaded material and published documents on how to construct an array of destructive devices and improvised weapons, including grenades.
Earthman advised law enforcement that he was a heroin addict and admitted to using methamphetamine three days three days prior to his arrest. He advised law enforcement, according to the complaint filed in the case, that he is a “Doom’s day prepper,” and that he had more firearms and chemicals at his residence.
Agents searched his residence in Waxahachie and located a Ruger .223 rifle, a black bag with pipes, a jar of Pyrodex, a box of 12.5 pounds of potassium nitrate, two bags of Hexamine, six silver caps, a bag of aluminum powder, a container with carbon steel balls, a box of grenade parts, a box of sodium nitrate, a box with 100 feet of cord, sodium bisulfate, a bottle of Thermite Ignition, assorted rounds of ammunition, black iron oxide, a jar of smokeless powder, a coffee can with nails and small silver pipes, primers, white pellets, peroxide, iodine, match heads, pipe collars, bolts and washers, detonators, a scale and ammonium perchlorate.
On June 20, 2013, ATF agents executed a warrant at an additional residence leased by Earthman in Dallas. In the house, agents located a Taurus revolver, ammunition, fifteen marijuana plants, a package of hexamine, assorted wigs, bomb making supplies, unknown liquids and powder chemicals.
A search of the National Firearms Registration and Transfer Record revealed no firearms or destructive devices registered to Earthman. An ATF Explosive Enforcement Officer (EEO) examined all of the items seized in this investigation and determined that the materials Earthman possessed were consistent with an improvised explosive weapon/destructive device. Because of Earthman’s possession of specialized literature regarding mines, grenades and bobby traps, coupled with the necessary parts and components, the EEO believed Earthman could have readily assembled a functioning explosive device.
ATF and the DPD investigated the case. Assistant U.S. Attorney Taly Haffar prosecuted.
U.S. Attorney Again Warns Connecticut Residents of Jury Duty ScamRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that a “Jury Duty Scam” has again been reported in Connecticut.
The Clerk’s Office for the U.S. District Court for the District of Connecticut recently learned that three people reported that they received a call from a man falsely identifying himself as “Lt. Steve Smith” with “badge number 8031” from the U.S. District Court in Bridgeport. The man referred to a case number, that the person had failed to appear for jury selection, and there was a warrant for their arrest. The caller told the people that a bond had been set and the matter would be resolved if they gave him four Green Dot pre-paid $500 VISA cards. In one instance, a victim purchased a Green Dot card and, at the caller’s direction, provided the card’s number to the caller.
The public is advised that this is a scam, and if a person were to receive a jury service-related call they should not provide any personal identification information or money to the caller. Federal and state courts in Connecticut do not call prospective jurors and ask for money or personal identifying information over the telephone. Juror information for the U.S. District Court in Connecticut can be found at www.ctd.uscourts.gov.
Anyone receiving a “Jury Duty Scam” phone call should report it, with any available Caller ID information, to the Federal Bureau of Investigation in New Haven at 203-777-6311, or 1-800-CALL FBI (1-800-225-5324).
U.S. Attorney Daly urged individuals who receive phone calls from suspicious sources never to disclose personal identifying information, as it may be used to cause serious financial harm and jeopardize a person’s credit.
“Identity thieves and scammers defrauding the public will be vigorously prosecuted when identified,” U.S. Attorney Daly stated.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Two Paulding, Mississippi Residents Sentenced to Prison for Conspiracy to Launder Drug MoneyRead the Press Release
Jackson, Miss – Lornell Von Moore, 49, and Patrina Bester Hayes, 37, both of Paulding, Mississippi, were sentenced by U.S. District Judge Daniel P. Jordan III today for conspiracy to launder drug money, announced U.S. Attorney Gregory K. Davis and Acting Special Agent in Charge Jerome R. McDuffie of Internal Revenue Service Criminal Investigation.
Moore was sentenced to 178 months in prison followed by three years of supervised release. He is currently serving nine years in federal prison for narcotics distribution. Hayes was sentenced to 100 months in federal prison followed by three years of supervised release.
Moore garnered over $2 million in drug profits in just a two year period beginning in 2008. Moore and Hayes operated LVM Trucking out of Louin, Mississippi, and washed millions of dollars of drug profits through the trucking company’s bank accounts as well as their private bank accounts.
As a result of the investigation into the narcotics trafficking of Moore and the money laundering activities of Moore and Hayes, investigators of the DEA and the IRS, through the office of the United States Attorney, seized a large amount of property associated with the money laundering conspiracy. The property included vehicles, tractors, trailers, houses and firearms.
“Today's sentencing is the direct result of the commitment of IRS Criminal Investigation, Drug Enforcement Administration, and our state and local partners to combat illegal narcotics and narcotics related money laundering violations,” said U.S. Attorney Davis. “These sentences should send a clear message that those who choose to become involved in these types of criminal activities will be identified, investigated and prosecuted to the fullest extent of the law.”
Jerome R. McDuffie, Acting Special Agent in Charge, IRS – Criminal Investigation, stated, “Today’s sentencing of Lornell Von Moore and Patrina Hayes is a victory for law enforcement. I want the narcotics traffickers out there to know that attempting to disguise drug-related financial transactions behind businesses like LVM Trucking will not protect them from being charged with money laundering violations and suffering the stiff penalties those violations carry. I would also like to thank the United States Attorney’s Office and our law enforcement partners for the work done on this very significant OCDETF investigation.”
The Internal Revenue Service Criminal Investigation Division and the Drug Enforcement Administration conducted the criminal investigation of the financial affairs leading to the current guilty plea. Officers from the Ridgeland Police Department, Jackson Police Department, Hinds County Sheriff=s Office, Jasper County Sheriff’s Office, Madison County Sheriff’s Office, and the Mississippi Bureau of Narcotics, participated in the investigation of Moore’s drug trafficking organization. Assistant U.S. Attorney Darren LaMarca prosecuted the case for the government.If you believe you have been a victim of fraud from a person or an organization soliciting relief funds on behalf of storm victims, contact the National Center for Disaster Fraud toll free at:
(866) 720-5721
You can also fax information to:
(225) 334-4707
or e-mail it to:
Making sure that victims of federal crimes are treated with compassion, fairness and respect.
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Help us combat the proliferation of sexual exploitation crimes against children.
Two Men Charged with Defrauding Delta and Northwest Air Lines of $22 MillionRead the Press Release
ATLANTA - Michael Yedor and Paul Anderson have been indicted by a federal grand jury on charges that they participated in a long-running scheme to defraud Delta Air Lines of millions of dollars. Yedor was arrested in San Diego, Calif. on Saturday, June 21, 2014.
“The longevity and scope of the scheme to defraud Delta is simply astonishing,” said United States Attorney Sally Quillian Yates. “The indictment is an important first step in finally bringing these defendants to justice after so many years of engaging in fraud.”
J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office, stated: “The FBI was not only uniquely positioned to investigate and present for prosecution this extensive case of fraud targeting Delta Air Lines, but also to coordinate the arrest of one of those individuals upon his return to the U.S. The FBI would like to thank our many law enforcement partners for their assistance in this matter, particularly those involved with the apprehension of Mr. Yedor at San Diego, California.”
According to United States Attorney Yates, the indictment, and other information presented in court: Anderson had been an employee of Northwest Airlines since 1979. In 2008, Delta Air Lines purchased Northwest. The two airlines merged into a single company in December 2009, at which time Anderson became an employee of Delta working in its Minneapolis, Minn., office.
The indictment alleges that, from at least 2004 through 2013, Anderson was involved with Yedor in a scheme to defraud Northwest and, later, Delta, by submitting numerous false invoices on behalf of a company, Airborne Voice and Data, purportedly owned by Yedor. The invoices sought payment from the airlines for goods provided and services supposedly rendered by Airborne Voice and Data, when in fact, both Anderson and Yedor knew that Yedor’s company had not provided any such goods or services.
The indictment also alleges that Yedor sent the invoices to Anderson to be approved. Anderson approved the fraudulent invoices, which caused the airlines to issue payments to Airborne Voice and Data. In exchange for approving each of the invoices, Anderson received a portion of the proceeds of the fraud. The indictment alleges that Yedor and Anderson caused Northwest and Delta to issue approximately $22 million in payments to Airborne on the basis of the false invoices between 2004 and 2013.
Yedor, 62, of Los Angeles, Calif., and Anderson, 57, of Apple Valley, Minn., were indicted on June 10, 2014, and have each been charged with conspiracy to commit mail fraud and ninety-six counts of mail fraud. The indictment was unsealed after Yedor’s arrest on Saturday, June 21, 2014.
Members of the public are reminded that the indictment only contains charges. The defendant is presumed innocent of the charges and it will be the government’s burden to prove the defendant’s guilt beyond a reasonable doubt at trial.
Delta Air Lines is fully cooperating with the investigation.
This case is being investigated by the Federal Bureau of Investigation. The arrest of Michael Yedor involved the assistance of and the FBI’s coordination with several federal and local authorities in locating and interdicting Yedor’s motor yacht, including: U.S. Customs and Border Protection Office of Air and Marine; U.S. Coast Guard; U.S. Border Patrol; San Diego Regional Coordinating Mechanism (ReCoM); San Diego Harbor Police; and San Diego Joint Harbor Operations Center.
Assistant United States Attorneys Glenn D. Baker, Jamie L. Mickelson, and Jenny Turner are prosecuting the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao/gan/.
Two KC Men Indicted for Robbing Raytown BankRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that two Kansas City, Mo., men were indicted by a federal grand jury today for robbing First Federal Bank in Raytown, Mo.
Robert T. Morris, 31, and Anthony Beeks, 52, both of Kansas City, were charged in an indictment returned by a federal grand jury in Kansas City. Today’s indictment replaces a federal criminal complaint that was filed against Morris on May 22, 2014, and adds Beeks as a co-defendant.
Today’s indictment alleges that Morris and Beeks, aiding and abetting each other, stole $2,025 from First Federal Bank, 9330 E. Gregory, Raytown, on April 24, 2014.
According to an affidavit filed in support of the original criminal complaint, Morris entered the bank, approached the teller counter and provided the teller with a demand note, which was similar in verbiage to the following, “YOU KNOW WHAT THIS IS, HURRY UP, PUT THE MONEY IN THE BAG, NO FUNNY BUSINESS, HURRY UP.” The teller did not have access to any money, but walked over to another teller and showed her the demand note. The second teller then provided Morris with $2,025, the indictment says. Morris allegedly put the stolen money in a manila envelope and fled the bank. The demand note was left behind.
On May 13, 2014, a witness told law enforcement officers that he recognized Morris from bank surveillance photos that were posted on a media Web site. A few minutes, Kansas City police officers located Morris and Beeks, who were driving through the Westport area, and began surveillance.
On May 22, 2014, a federal search warrant was executed on the vehicle Beeks had been driving, which was at his residence. Morris was arrested the same day. Beeks was arrested today.
Dickinson cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Special Assistant U.S. Attorney Leena V. Ramana. It was investigated by the FBI and the Kansas City, Mo., Police Department.Three Individuals Indicted for Theft of Government PropertyRead the Press Release
SAN JUAN, P.R. – Yesterday, June 26, a Federal grand jury returned an 86-count indictment charging three individuals for theft of government property, announced Rosa Emilia Rodríguez-Vélez, United States Attorney for the District of Puerto Rico. The case involves schemes to defraud the United States by fraudulently obtaining and converting to cash United States Treasury Checks issued by the Internal Revenue Service, in connection fraudulent tax returns filed with the agency.
The defendants charged in the indictment cashed or attempted to cash or deposit a Treasury Check issued by the IRS in connection with a false and fraudulent tax return. The check amounts range from $5,460 to $9,851. Defendant Alfredo Rojas-Reynoso is facing 43 charges of theft of government property and 43 charges of aggravated identity theft. Alexander Aguasvivas-Troncoso is facing 17 charges of theft of government property and 17 charges of aggravated identity theft. Miguel A. Berríos-Velàzquez is facing 10 charges of theft of government property and 10 charges of aggravated identity theft.
The tax returns were filed using the personal identifying information of individuals, when in reality, said individuals never filed such tax returns with the IRS. The investigation has revealed that said false and fraudulent tax returns were filed without the consent of the taxpayers who appear in the returns. The majority of the defendants would attempt to negotiate the Treasury checks by depositing them in their accounts at financial institutions, that is, banks and credit unions.
“The Department of Justice is strongly committed to promoting compliance with federal tax laws, and we will continue to aggressively prosecute these offenses” said Rosa Emilia Rodríguez-Vélez, United States Attorney for the District of Puerto Rico.
“Stealing identities, filing false tax returns, and negotiating U.S. Treasury checks resulting from this criminal activity are violations of the law that IRS Criminal Investigation takes very seriously. This indictment shows that IRS Criminal Investigation and the U.S. Attorney's Office will continue to identify, investigate, and bring to justice those who attempt to benefit from the use of stolen identities,” said José A. Gonzàlez, Special Agent in Charge, IRS Criminal Investigation.
If convicted, the defendants face a maximum possible sentence of ten years on the theft of government property, and two consecutive years for each count of aggravated identity theft.
The case is being investigated by IRS – Criminal Investigation Division. Indictments are only charges and are not evidence of guilt. Defendants are presumed to be innocent unless and until proven guilty. The investigation is ongoing.
Three Foam Manufacturers Plead Guilty in Price Fixing SchemeRead the Press Release
Three manufacturers of polyurethane foam used to create interior components for automobiles pleaded guilty today to participating in a scheme to fix prices to customers, the Department of Justice announced.
Riverside Seat Co., Woodbridge Foam Fabricating Inc. and SW Foam LLC pleaded guilty to a one-count felony charge in the U.S. District Court for the Eastern District of New York in Brooklyn. According to the charge, the companies conspired with others to fix prices for polyurethane flexible slab stock automotive foam in the U.S. and elsewhere from at least as early as June 9, 2008 until at least April 20, 2009. The companies have agreed to pay a total of $6,148,800 in criminal fines and to cooperate with the department’s ongoing investigation.
“Today’s charges demonstrate the Antitrust Division’s commitment to holding companies accountable for conspiracies that affect components used in products that consumers rely on every day,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “The Antitrust Division will vigorously prosecute companies that engage in price-fixing schemes that subvert normal competitive processes and defraud American consumers and businesses.”Riverside Seat, Woodbridge, and SW Foam manufactured polyurethane flexible slab stock automotive foam – a low-density, slab stock, flexible foam used as a component of automotive interior parts, including seats, headliners, headrests, door panels and armrests. Polyurethane flexible slab stock automotive foam includes only the foam itself and does not include any automotive parts in which such foam may be a component.
According to the charge, the companies and their co-conspirators discussed polyurethane foam prices and agreed to coordinate the timing and amount of price increases to customers. The companies carried out the agreement and exchanged information for the purpose of monitoring and enforcing adherence to the agreement.
The three manufacturers are charged with price fixing in violation of the Sherman Act, which carries maximum penalties of a $100 million criminal fine for corporations. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
Today’s pleas are the result of an ongoing federal antitrust investigation being handled by the Antitrust Division’s New York Office, with assistance from the Cleveland Field Office of the FBI and the New York Field Office of the FBI. Anyone with information concerning price fixing or other anticompetitive conduct in the polyurethane foam industry should contact the Antitrust Division’s Citizen Complaint Center at 1-888-647-3258 or visit www.justice.gov/atr/contact/newcase.html.St. Thomas Man Sentenced to 100 Months in Prison for Possession of Cocaine with the Intent to DistributeRead the Press Release
St. Thomas, USVI - United States Attorney Ronald W. Sharpe announced that Marvin Griffin, 50, of St Thomas, Virgin Islands was sentenced yesterday in District Court to 100 months in prison for possessing with intent to distribute five kilograms of cocaine. After serving his prison sentence, Griffin will be on Federal supervised release for four years. Griffin was remanded to the custody of the United States Marshals Service to complete service of his sentence.
According to court records, on September 29, 2013, the defendant Griffin arrived at the Cyril E. King Airport and attempted to board an American Airlines flight to New York. Griffin had a black backpack, plastic bag and a box in his possession as he entered the primary inspection area of the airport. When the Officers of U.S. Customs and Border Protection (CBP) questioned Griffin about the contents of the box, he stated that the box contained various food items. As a result of his answers, he was referred to the Agricultural Specialist. When the Agricultural Specialist opened the black backpack, she immediately noticed the odor of marijuana. As subsequent search of the box in Griffin’s possession revealed it to contain several cans. When these cans were opened, they were found to contain five kilograms of cocaine. Griffin was then placed under arrest. He pleaded guilty on February 20, 2014 and has been incarcerated since that date. The case was investigated by CBP and U.S. Department of Homeland Security, Homeland Security Investigations. The case was prosecuted by Assistant U.S. Attorney Ishmael A. Meyers, Jr.
St. Louis Man Arrested After Traveling to Denver to Have Sex with Mother and Two Minor DaughtersRead the Press Release
The mother was actually an Homeland Security Investigations undercover agent
DENVER – Darwin Gilbert Gowen, age 61, of St. Louis, Missouri, was arrested by U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI) agents at Denver International Airport (DIA) after he traveled with intent to have sex with two minor children, U.S. Attorney John Walsh and HSI Special Agent in Charge Kumar Kibble announced. Gowen has previously made his initial appearance, where he was advised of his rights and the charges pending against him. He is due back in court on Wednesday, July 2, 2014 at 10:00 a.m. before U.S. Magistrate Judge Kristen L. Mix for a detention hearing. The Criminal Complaint was filed on June 20, 2014. Gowen was arrested by HSI agents at DIA on that same day.
The affidavit in support of the Criminal Complaint was written by an HSI special agent based in Greeley, Colorado, who was working in an undercover capacity. In her undercover role as a 37-year-old single mother of two minor daughters, ages 15 and 11, she communicated with an individual who expressed an interest in having sex with the mother and both daughters.
During the conversations, which took place primarily via email and text, the defendant stated that he was “a 60 year old male, widowed . . . wanting to experience the wild side of life.” He also said he “adored chubby girls” . . . and was “looking for naughty daughters . . . who love to hook up with a kinky mom for mom daughter fun.” Further investigation revealed that the individual was Darwin Gilbert Gowen of St. Louis, Missouri.
Gowen told the undercover agent that he was going to fly to Denver to see her and have sex with her and her daughters. HSI agents confirmed that the defendant had arranged to fly to Denver on June 19th. He was observed by HSI agents leaving the St. Louis Airport. He was then seen at DIA. Gowen met a female HSI agent at the DIA baggage check. After the two discussed that he flew to Denver for the express purpose of having sex with the two minor children, he was arrested.
“Individuals who travel to have sex with minors are dangerous, as there is always the chance that they communicate with a vulnerable woman with children as opposed to an undercover agent,” said U.S. Attorney John Walsh. “Thanks to the work of HSI, another person who was planning to sexually exploit innocent children now faces criminal charges.”
“Crimes against children are some of the most loathsome our agency investigates," said Special Agent in Charge Kumar Kibble, of HSI Denver. "These criminal charges serve as warning to other child predators. We will find you, arrest you and make sure that you are prosecuted to the fullest extent of the law."
If convicted of travel with intent to engage in illicit sexual conduct, the defendant faces not more than 30 years in federal prison, and up to a $250,000 fine. If convicted of attempted coercion and enticement, the defendant faces not less than 10 years, and up to life in federal prison, and up to a $250,000 fine, per count for each of the two counts charged.
This case was investigate by U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI). The Denver Police Department assisted with the arrest at DIA.
Gowen is being prosecuted by Assistant U.S. Attorney Alecia Riewerts Wolak, the coordinator of the Project Safe Childhood initiative for the District of Colorado.
A criminal complaint is a probable cause charging document. Anyone accused of committing a federal felony crime has a Constitutional right to be indicted by a grand jury.
The charges contained in the Criminal Complaint are allegations, and the defendant is presumed innocent unless and until proven guilty.
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.
South Carolina National Guard Official Pleads Guilty to Accepting Bribes to Award Freight Contracts to Alabama CompaniesRead the Press Release
BIRMINGHAM -- A South Carolina National Guard official pleaded guilty today in federal court to wire fraud and accepting bribes to steer freight contracts to an Alabama broker, announced U.S. Attorney Joyce White Vance, FBI Special Agent in Charge Richard D. Schwein Jr. and Frank Robey, director of the U.S. Army Criminal Investigation Command's Major Procurement Fraud Unit.
TIMOTHY WOOTEN, 52, a traffic management specialist for the National Guard Bureau, U.S. Property and Fiscal Office, in South Carolina, pleaded guilty before U.S. District Judge Madeline H. Haikala to three wire fraud counts and one bribery count involving freight transportation contracts totaling about $321,949. His sentencing is scheduled Oct. 15.
According to Wooten's plea agreement with the government, he overrode the electronic system that generated a list of "Best Value Carriers" for freight shipments so that he could manually select a company for a shipment. Between September 2011 and January 2012, Wooten manually awarded 55 contracts to two Tuscaloosa-area companies, identified as C.E. and U.S.T. The freight broker who worked as an agent for both companies paid Wooten about 25 percent of his commissions on the freight contracts in return for Wooten awarding them to his companies. The agent received about $115,882 in commission on the 55 contracts and paid about $29,742 in bribes to Wooten, according to the plea agreement.
The agent is identified in government documents by the initials, D.B. He attempted to conceal the bribes to Wooten by making the payments to Wooten's wife, who D.B. purportedly hired as a broker for one of his companies. Aside from making a few phone calls, Wooten's wife did no work for D.B., the plea agreement says. The payments to her "were in return for Wooten providing freight contracts to D.B.'s companies," it says.
Wooten directed government payment to D.B.'s two companies on completed transportation contracts by initiating wire transfers from U.S. Bank in Minneapolis, Minn., to a bank in Tuscaloosa, according to the plea agreement. Those payments constitute the wire fraud counts against Wooten.
Wire fraud carries a maximum penalty of 20 years in prison and $250,000 fine. The bribery count carries has a maximum penalty of 15 years in prison and a fine of $250,000 or three times the value of the bribe.
The FBI and Army CID, MPFU, investigated the case, which Assistant U.S. Attorney Tamarra Matthews Johnson is prosecuting.
South Carolina Man Charged with Tampering with Witnesses in Federal TrialRead the Press Release
CAMDEN, N.J. - A South Carolina man was arrested today and charged with tampering with witnesses in a federal criminal trial that concluded last September, U.S. Attorney Paul J. Fishman announced.
Dennis Nadeau, 53, of Myrtle Beach, S.C., was arrested at his home this morning by agents of the FBI and charged by a complaint with misleading conduct with intent to influence the testimony of four actual and potential witnesses in the trial of the U.S. v. Adam Lacerda et al. Nadeau will have an initial appearance before U.S. Magistrate Judge Karen M. Williams in Camden federal court at a later date.
According to documents filed in this case and in the prior criminal case:
From 2010 through 2013, Nadeau worked at the New Jersey-based Vacation Ownership Group LLC and its successor, VO Financial. In 2013, 13 former VO Group employees pleaded guilty to conspiring to defraud timeshare owners. Four other VO Group employees, including VO Group President Adam Lacerda and his wife, Ashley Lacerda, were convicted by a jury of conspiracy and related charges after a seven-week trial that concluded last September. The Lacerdas have been in custody since the trial and all defendants are awaiting sentencing.
Shortly before the start of last year’s trial, Ashley Lacerda allegedly directed Nadeau to call potential trial witnesses and try to convince them that they had not been defrauded. Nadeau called several individuals, made numerous false statements about their dealings with VO, and tried to get them to agree with the false statements. Unbeknownst to three of the witnesses, Nadeau was recording the calls.
The witness tampering count with which Nadeau is charged carries a maximum penalty of 20 years in prison and a fine of the greater of $250,000 or twice the gain or loss caused by the offense.
U.S. Attorney Fishman credited special agents of the FBI’s Atlantic City Resident Agency, under the direction of Special Agent in Charge Aaron T. Ford, with the ongoing investigation leading to today’s charges.
The charges and allegations in the complaint are merely accusations and the defendant is presumed innocent unless and until proven guilty.
The government is represented by Assistant U.S. Attorney R. David Walk Jr. of the U.S. Attorney’s Office in Camden.
14-236
Nadeau, Dennis Complaint
Slaton, Texas, Man Sentenced to 15 Years in Federal Prison for Producing Child PornographyRead the Press Release
LUBBOCK, Texas — Dale Wray Fulford, 77, of Slaton, Texas, was sentenced today by U.S District Judge Sam R. Cummings to 15 years in federal prison, following his guilty plea in March 2014 to one count of production of child pornography. The announcement was made today by U.S. Attorney Sarah R. Saldaña.
Fulford admitted that between February 2013 and early February 2014, he used, persuaded, induced and enticed a female minor, under age 18, to engage in sexually explicit conduct that he recorded on a digital camera.
The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and the Lubbock County Sheriff’s Office investigated. Assistant U.S. Attorney Steven M. Sucsy prosecuted.
Ship Operator Pleads Guilty to, and Chief Engineer Indicted for, Violations of the Act to Prevent Pollution from Ships and Obstruction of JusticeRead the Press Release
U.S. Attorney Kenneth Allen Polite, Jr. announced that today, MARINE MANAGERS LTD., a Liberian corporation headquartered in Piraeus, Greece, pled guilty to a two-count bill of information charging the company with knowingly failing to maintain an oil record book while in port and within the internal waters of the United States, and submitting a false document to the U.S. Coast Guard.
In addition, MATTHAIOS FAFALIOS, 64, a resident of Greece and Chief Engineer of the Motor Vessel (“M/V”) Trident Navigator, was indicted yesterday on three related charges, specifically failing to maintain an accurate oil record book, obstruction of justice, and witness tampering.
According to court documents, MARINE MANAGERS LTD., was the operator of the M/V Trident Navigator which transported bulk cargo between various ports and places in the world, including the Port of New Orleans and other locations in the Eastern District of Louisiana. On or about December 28, 2013, while the M/V Trident Navigator was sailing, FAFALIOS instructed the Second Engineer to construct a bypass system (often referred to as a “magic pipe”) that could be connected between the vessel’s bilge pump and overboard discharge valve. The purpose of the bypass was to discharge the contents of the ship’s bilge tank directly into the sea, circumventing the ship’s Oil Water Separator and Oil Content Monitor. On or about December 31, 2013, FAFALIOS ordered the Second Engineer to hook up the “magic pipe” and to discharge several metric tons of oily bilge waste from the bilge tank directly into the sea. The “magic pipe” was removed after the discharge was completed and the discharge was not recorded in the vessel’s Oil Record Book as required. FAFALIOS additionally confiscated a crew member’s cell phone which contained a photograph of the installed “magic pipe,” and caused that photo to be deleted.
On or about January 18, 2014, U.S. Coast Guard personnel boarded the M/V Trident Navigator while it was anchored in the Mississippi River near New Orleans. A tip from a crewmember led them to the discovery of the “magic pipe.” FAFALIOS was uncooperative and further obstructed the Coast Guard investigation by instructing crewmembers to deny knowledge of the “magic pipe.”
Although the actions of the crewmembers on the vessel were contrary to defendant MARINE MANAGERS LTD.’s written policies and procedures, the company accepts that it is vicariously liable for its employees’ actions.
MARINE MANAGERS LTD. faces a maximum fine of $500,000 for each count. Sentencing has been scheduled for October 2, 2014, before U.S. District Judge Carl J. Barbier.
For each of his three counts, FAFALIOS faces a maximum fine of $250,000 and three years of supervised release. In addition, he faces a maximum term of imprisonment of six years, five years, and twenty years for the records, obstruction, and witness tampering charges, respectively.
“The Coast Guard is committed to uncovering and investigating regulatory and criminal violations that threaten the health of our marine environment. The successful prosecution of this case is due to the outstanding cooperation between Coast Guard Sector New Orleans, the Coast Guard Investigative Service, and the Department of Justice," said Rear Admiral Kevin S. Cook, Eighth Coast Guard District Commander.
The case against MARINE MANAGERS LTD was investigated by Special Agents of the United States Coast Guard Criminal Investigative Service. Prosecution is being handled by Assistant United States Attorney Gregory M. Kennedy and DOJ Environmental Crimes Section Attorney Kenneth Nelson. The case against MATTHAIOS FAFALIOS was also investigated by Special Agents of the Coast Guard Criminal Investigative Service. Prosecution is being handled by DOJ Environmental Crimes Section Attorney Kenneth Nelson and Assistant United States Attorney Emily K. Greenfield.
(Download Factual Basis - Marine Managers Ltd. )
(Download Indictment - Matthaios Fafalios )
Russell Adler Sentenced in Connection with Rothstein CaseRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Jose A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), announce that Russell S. Adler, 52, of Ft. Lauderdale, was sentenced today by United States District Judge James I. Cohn to 30 months’ imprisonment, to be followed by 2 years’ supervised release in connection with his conviction for one count of conspiracy to violate the Federal Election Campaign Act and to defraud the United States, in violation of Title 18, United States Code, Section 371. The defendant was a shareholder of the former Ft. Lauderdale law firm of Rothstein, Rosenfeldt and Adler, P.A. (RRA).
During his April 4, 2014 guilty plea, the defendant admitted that, in order to circumvent campaign finance laws setting limitations on the amounts which donors can contribute, RRA Chairman and CEO Scott W. Rothstein enlisted some of the attorneys and administrative personnel of RRA, and other persons associated with RRA, including Adler, to make political contributions to various political campaigns which were unlawfully reimbursed to them by RRA.
Mr. Ferrer commended the investigative efforts of the FBI and IRS-CI. This case is being prosecuted by Assistant U.S. Attorneys Lawrence D. LaVecchio, Paul F. Schwartz and Jeffrey N. Kaplan.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Ripley Man Sentenced to 121 MonthsRead the Press Release
Memphis, TN – William David Maness, age 39, of Ripley, Tenn., was sentenced to 121 months in federal prison following his guilty plea to one count of possession with intent to distribute less than 50 grams of methamphetamine, announced Edward L. Stanton III, U.S. Attorney for the Western District of Tennessee and 25th District Attorney General Mike Dunavant.
According to the facts alleged in the indictment and revealed during the sentencing hearing, on February 25, 2013, Maness possessed and distributed under 50 grams of methamphetamine to an undercover source who was working for the Lauderdale County Sheriff’s Department. This is Maness’s fourth methamphetamine-related conviction.
“Illegal drug trafficking, and the violence that often accompanies it, is a plague upon our communities. My office will vigorously pursue any and all involved in these illegal activities” said US Attorney Stanton.
“Methamphetamine has had a devastating impact on rural communities in Tennessee,” said District Attorney General Dunavant. “This defendant, in particular, has been distributing methamphetamine in Lauderdale County for the last eight years. This prison sentence will prevent Maness from further destroying our community and sends a message to other meth dealers.”
In addition to the prison sentence, U.S. District Judge Samuel H. Mays ordered Maness to serve three years of supervised release. There is no parole in the federal prison system.
This case was investigated by the Lauderdale County Sheriff’s Office and the 25th District Attorney General’s Office. Special Assistant U.S. Attorney Samuel R. Stringfellow represented the government.Prison Sentences and over $500,000 in Fines for Contractors Who Bribed the “Godfather” of Camp PendletonRead the Press Release
The presidents of two government contracting companies, as well as the companies themselves, were sentenced today for bribing the so-called “Godfather” of Camp Pendleton in exchange for millions of dollars in construction and service contracts at Camp Pendleton and other federal facilities.
At today’s hearing, U.S. District Judge Anthony J. Battaglia sentenced Hugo Hernandez Alonso, president of Hugo Alonso, Inc. (HAI), to one year in prison, three years of supervised release and a fine of almost $127,000. His company was sentenced to five years of probation and the same fine, which could be offset by payment of Alonso’s individual fine.
Bayani Yabut Abueg, Jr., president of MBR Associates, Inc. (MBRA), was sentenced to six months in prison, three years supervised release, $105,025 in restitution to the IRS and a fine of $366,140. His company was sentenced to five years of probation plus a $375,000 fine, which could be offset by payment of Abueg’s individual fine.
The judge ordered both men, who are free on bond, to self-surrender by January 2, 2015.
Alonso, Abueg, their respective companies, and Natividad Cervantes, who was known as the “Godfather” of Camp Pendleton, all pleaded guilty in January, each admitting their parts in the bribery-kickback scheme. Cervantes is scheduled to be sentenced by Judge Battaglia on July 24, 2014.
According to Alonso’s plea agreement, the bribes were made in connection with the awarding of at least six government construction and service contracts from 2008 to 2011.
In addition, Alonso, Abueg and their respective companies pleaded guilty to soliciting and accepting kickbacks from subcontractors in relation to government contracts awarded to Alonso and Abueg’s companies (some of which were steered to them by Cervantes).
The defendants admitted that they solicited and accepted the kickbacks from various subcontractors in exchange for favorable treatment in connection with future subcontracts. Abueg also admitted filing a false federal income tax return for 2010 that failed to report over $268,000 in illegal kickbacks.
Bribery at Camp Pendleton
When he entered his guilty plea, Cervantes admitted using his position at Camp Pendleton to solicit bribes from Alonso and Abueg’s construction companies seeking to do business on the base. Cervantes made it clear that since at least as early as September 2008, he used his position supervising construction and service contracts to seek bribes from Alonso and Abueg, on behalf of either HAI or MBRA.
In return for awarding HAI and MBRA contracts, Cervantes received cash payments from Alonso and Abueg and extensive free construction work on his personal condominium.
As part of his plea agreement, Cervantes admitted that in approximately 2008, he agreed to accept a bribe of $25,000 to assist Alonso and HAI in obtaining a $3.5 million government contract to install flooring at Camp Pendleton.
In arranging for a bribe payment, Cervantes, through a third-party conduit, requested that Alonso “have the 25 package” (code for the $25,000 bribe) available on September 5, 2008. On that same day, Alonso provided the $25,000 to the third party conduit for delivery to Cervantes. Cervantes and Alonso admitted that Alonso paid Cervantes a total of at least $119,000 in bribes between 2008 and 2011. Abueg admitted delivering $20,000 of these bribes to Cervantes, at the direction of Alonso. Alonso’s company, HAI, also entered a guilty plea regarding the paying of bribes to Cervantes.
The bribes to Cervantes were not limited to just HAI. Both Cervantes and Abueg admitted to exchanging a bribe in 2011 related to the awarding of a $3 million contract at Camp Pendleton to Abueg’s company, MBRA. Further, Cervantes admitted that on March 26, 2013, he met with a cooperating witness, who agreed to pay Cervantes a $40,000 bribe in exchange for assistance in obtaining a new $4 million contract at Camp Pendleton. The bribe was to be structured over a number of payments. The first payment was scheduled for March 28, 2013, with the balance of the bribe to be paid after the contract was awarded.
On March 28, 2013, the cooperating witness met with Cervantes at a local business on Miramar Road in San Diego, California, to make the first payment that was discussed earlier in the week. During this meeting, Cervantes discussed, among other things, the payment schedule and the source of funds for the bribe payments. At the end of the meeting, the cooperating witness handed Cervantes an envelope containing $10,000 cash. At that point, FBI agents arrested Cervantes.
Kickbacks Related to Government Contracts and Subcontracts
In addition to the bribery scheme, Alonso and Abueg engaged in a vast scheme to solicit kickbacks from subcontractors in exchange for favorable treatment in the awarding of subcontracts on various government contracts awarded to HAI and MBRA. Some of these government contracts were the same contracts at Camp Pendleton improperly awarded to HAI and MBRA with Cervantes’ help in exchange for bribes.
Abueg, as a representative of HAI and then MBRA, admitted that between 2008 and 2011, he solicited, received, and accepted over $539,000 kickbacks from various subcontractors. The kickbacks typically consisted of cash given to Abueg or to Abueg’s son, and checks issued to Abueg, his son, or his daughter, all in an attempt to conceal the nature of the kickbacks. Other kickbacks to Abueg consisted of subcontractors performing discounted work at the personal residences of Abueg’s wife, relatives, and associates, including Cervantes. For some of the kickbacks, Abueg requested that the subcontractors inflate their original estimate for certain work associated with the government contract. The inflated amount used for the kickback was then improperly included in corporate books and records as a legitimate business expense.
Separately, Alonso, as representative of HAI, admitted that in 2009, he accepted a kickback in the form of discounted remodeling of his Chula Vista residence by a subcontractor. Abueg’s and Alonso’s companies, MBRA and HAI, respectively, also entered guilty pleas regarding the solicitation and acceptance of kickbacks.
“We are not going to allow criminals to turn the contracting system into their own little fiefdoms,” said U.S. Attorney Laura Duffy. “The extreme home makeover party is over for these defendants, who will no longer be ordering up new kitchens and baths for relatives at taxpayer expense.”
FBI Special Agent in Charge Daphne Hearn commented, “Members of our community expect government employees to act ethically and honestly. When even one person dishonors that trust, it rips away the professional dignity that others government servants have spent a lifetime building. At a time when our nation’s military must do more with fewer resources, the actions of the defendants undermine our country’s best interests for their own financial gains.”
“It’s all about playing by the rules—you earn an honest dollar and you report it on your tax return. Failure to do so will land you in prison,” said Erick Martinez, Special Agent in Charge of IRS Criminal Investigation. “IRS Criminal Investigation is proud to work with our law enforcement partners by lending its financial expertise in any investigation involving the improper awarding of government contracts.”
“The Defense Criminal Investigative Service works closely with its law enforcement partners to bring to justice those individuals who seek to illegally enrich themselves at the expense of U.S. taxpayers,” said Chris Hendrickson, Special Agent in Charge of the Western Field Office. “While the vast majority of DoD contractors exercise lawful business practices and engage in fair competition, a few are driven by greed to break the law. Those who do will be caught and punished. The American taxpayer will accept nothing less.”
According to David A. House, Special Agent in Charge, Pacific Rim Regional Office of Investigations General Services Administration, Office of Inspector General: “This investigation demonstrates GSA OIG’s commitment to ensuring the integrity of the procurement process, especially when dealing with public buildings. Bribes and kickbacks are an affront to every taxpayer; we are dedicated to investigating these allegations thoroughly.”
“Hugo Alonso and Bayani Abueg instigated a bribery and kickback scheme that defrauded our government and American taxpayers for personal gain,” said Inspector General Peggy E. Gustafson. “Today’s sentencing demonstrates the SBA OIG’s resolve to bring those who commit fraud in SBA’s set-aside contracting programs and erode the public’s trust in government to justice. I want to thank the U.S. Attorney’s Office for its dedicated leadership and professionalism in pursuit of justice served today.”
The public is encouraged to report possible public corruption criminal activity by calling the FBI’s public corruption/border corruption hotline at (877) NO-BRIBE or (877) 662-7423, or by calling the Department of Defense’s hotline at (800) 424-9098 or emailing [email protected].
DEFENDANT Case Number: 14cr0120-AJBHugo Hernandez Alonso
Age: 50 City: Chula Vista, CA Case Number: 14cr0144-AJBBayani Yabut Abueg, Jr.
Age: 51 San Diego, CACORPORATE DEFENDANTS
Case Number: 14cr0120-AJBHugo Alonso, Inc.
Chula Vista, CA
Case Number: 14cr0144-AJBMBR Associates, Inc.
National City, CA
CHARGESTitle 18, United States Code, Section 371 – Conspiracy to commit bribery of public official
Maximum penalties for individual defendants: 5 years’ imprisonment, $250,000 fine, or twice the gross amount of defendant’s pecuniary gain from the offense
(Defendants Alonso and Hugo Alonso, Inc.)Title 41, United States Code, Sections 8701, 8702, and 8707 – Anti-Kickback Act Violation
Maximum penalties for individual defendants: 10 years’ imprisonment, $250,000 fine, or twice the gross amount of defendant’s pecuniary gain from the offense
(Defendants Alonso, Hugo Alonso, Inc., Abueg, and MBR Associates, Inc.)Title 26 United States Code, Section 7206(1) – Filing a False Tax Return
INVESTIGATING AGENCY
Maximum penalties: 3 years imprisonment, $250,000 fine, or twice the gross amount of the tax loss from the offense
(Defendant Abueg only)Federal Bureau of Investigation
Naval Criminal Investigative Service
Internal Revenue Service, Criminal Investigation
Department of Defense Criminal Investigative Service
General Services Administration, Office of Inspector General
Small Business Administration, Office of Inspector General*Indictments and complaints are not evidence that the defendant committed the crime charged. All defendants are presumed innocent until the United States meets its burden in court of proving guilt beyond a reasonable doubt.
Port Saint Lucie Return Preparer Convicted in Tax Fraud and Identity Theft SchemesRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Jose A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), announce that defendant Stevens Nore, 33, of Port Saint Lucie, was convicted by a jury of thirty counts, including twenty-one counts of preparing false tax returns, in violation of Title 26, United States Code, Section 7206(2), four counts of filing false tax returns, in violation of Title 26, United States Code, Section 7206(1), three counts of theft of public money, in violation of Title 18, United States Code, Section 641, and two counts of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A.
The Court has reserved judgment as to four of the counts pending argument by the parties. Nore was immediately remanded to the custody of the United States Marshals Service. At sentencing, Nore faces a possible maximum statutory sentence of up to three years in prison for each count of preparing and filing false tax returns, up to 10 years in prison for each count of theft of public money, and a mandatory term of two years in prison, consecutive to any other term in prison, for each count of aggravated identity theft.
According to evidence presented at trial and court documents, from June 11, 2009 through April 2012, Nore owned and operated Fraternity Tax and Services, a tax return preparation business located in Fort Pierce, Florida. Nore prepared and submitted Individual Tax Returns (Forms 1040), with accompanying schedules, to the IRS on behalf of taxpayers claiming false deductions and credits for tax years 2009 to 2011. Nore also filed false tax returns for 2010 and 2011 by falsely stating the amount of gross receipts and sales on Schedule C forms. The defendant stole three tax refunds totaling $26,349.30 to which he was not entitled, and used the identity of two individuals without their permission.
Mr. Ferrer commended the investigative efforts of IRS-CI. This case is being prosecuted by Assistant U.S. Attorneys Shaniek Maynard and Russell R. Killinger.
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.
Patient Recruiter Pleads Guilty for Role in $6.5 Million Health Care Fraud Scheme<br />Read the Press Release
A patient recruiter for a Miami home health care agency pleaded guilty today in connection with a health care fraud scheme involving defunct home health care company Nestor’s Health Services Inc. (Nestor HH). The owner and operator of Nestor HH pleaded guilty to charges related to the scheme earlier this month.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office, and Acting Special Agent in Charge Ryan Lynch of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami office made the announcement.
On June 27, 2014, Euridice Borroto, 45, of Miami, Florida, pleaded guilty before U.S. Magistrate Judge Jonathan Goodman in the Southern District of Florida to one count of conspiracy to solicit and receive health care kickbacks and to defraud the United States. Sentencing is scheduled for Aug. 25, 2014.
According to court documents, Borroto was paid bribes and kickbacks for recruiting patients on behalf of Nestor HH, a Miami home health care agency that purported to provide home health and physical therapy services to Medicare beneficiaries. The owner and operator of Nestor HH operated Nestor HH for the purpose of billing the Medicare Program for, among other things, expensive physical therapy and home health care services that were not medically necessary and/or were not provided.
According to court documents, Borroto solicited and received kickbacks and bribes from the owner and operator of Nestor HH in return for recruiting and providing patients to Nestor HH for home health care and therapy services that were medically unnecessary and, in many instances, were not provided. Nestor HH would then fraudulently bill the Medicare program for home health care services on behalf of the recruited patients, in violation of federal criminal laws. Borroto knew that in many instances the patients she recruited for Nestor HH did not qualify for the services billed to Medicare.
From approximately March 2009 through at least January 2014, Nestor HH submitted more than $6.5 million in claims for home health services. Medicare paid Nestor HH more than $6.1 million for these fraudulent claims before the fraud was exposed.
In documents filed with the court, Borroto also acknowledged her involvement in similar fraudulent schemes at other Miami health care agencies.
The case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. This case is being prosecuted by Trial Attorneys Anne P. McNamara and A. Brendan Stewart of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 1,900 defendants who have collectively billed the Medicare program for more than $6 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Team (HEAT), go to: www.stopmedicarefraud.gov.Patient Recruiter Pleads Guilty for Role in $6.5 Million Health Care Fraud SchemeRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Leslie R. Caldwell, Assistant Attorney General, Department of Justice (DOJ) Criminal Division, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Ryan Lynch, Acting Special Agent in Charge of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami office, announce today that Euridice Borroto, 45, of Miami, Florida, pled guilty before U.S. Magistrate Judge Jonathan Goodman to one count of conspiracy to solicit and receive health care kickbacks and to defraud the United States. Sentencing is scheduled for Aug. 25, 2014.
A patient recruiter for a Miami home health care agency, Borroto, pled guilty in connection with a health care fraud scheme involving defunct home health care company Nestor’s Health Services Inc. (Nestor HH). The owner and operator of Nestor HH pleaded guilty to charges related to the scheme earlier this month.
According to court documents, Borroto was paid bribes and kickbacks for recruiting patients on behalf of Nestor HH, a Miami home health care agency that purported to provide home health and physical therapy services to Medicare beneficiaries. The owner and operator of Nestor HH operated Nestor HH for the purpose of billing the Medicare Program for, among other things, expensive physical therapy and home health care services that were not medically necessary and/or were not provided.
According to court documents, Borroto solicited and received kickbacks and bribes from the owner and operator of Nestor HH in return for recruiting and providing patients to Nestor HH for home health care and therapy services that were medically unnecessary and, in many instances, were not provided. Nestor HH would then fraudulently bill the Medicare program for home health care services on behalf of the recruited patients, in violation of federal criminal laws. Borroto knew that in many instances the patients she recruited for Nestor HH did not qualify for the services billed to Medicare.
From approximately March 2009 through at least January 2014, Nestor HH submitted more than $6.5 million in claims for home health services. Medicare paid Nestor HH more than $6.1 million for these fraudulent claims before the fraud was exposed.
In documents filed with the court, Borroto also acknowledged her involvement in similar fraudulent schemes at other Miami health care agencies.
Mr. Ferrer commended the investigative efforts of the DOJ Criminal Division’s Fraud Section, FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force. This case is being prosecuted by DOJ Trial Attorneys Anne P. McNamara and A. Brendan Stewart of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 1,900 defendants who have collectively billed the Medicare program for more than $6 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Team (HEAT), go to: www.stopmedicarefraud.gov.
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.
Northern District of Georgia Targets Prescription Drug AbuseRead the Press Release
ATLANTA – Abuse of pain medications like oxycodone continues to plague Georgia communities at epidemic levels and now accounts for six times more deaths than all of the traditional illegal drugs combined. The United States Attorney’s Office in the Northern District of Georgia has enhanced its prosecution efforts on the prescription drug abuse problem as part of a broad effort to reverse this deadly trend.
“The abuse of prescription drugs and its related criminal activity is a significant public safety problem in many Georgia communities - one we have made a central focus of our office,” said United States Attorney Sally Quillian Yates. “This problem is too big to prosecute away and requires solutions from doctors, pharmacists, legislators, and public health officials. But we are committed to prosecuting and punishing those who are the primary contributors to this problem.”
“Over the past decade Oxycodone and other opioids have risen to be the most abused and overdose related drugs in the State of Georgia,” said C. Richard Allen, Director of the Georgia Drugs & Narcotics Agency. “Five of the top eight drugs found in overdose deaths are opioids. Of those eight, Oxycodone products are #2 on this list. Ten of the top twenty five most prescribed drugs are opioids. We applaud the U.S. Attorney's office and its efforts to help stop, or at least slow down, this deadly epidemic.”
In the past year, the U.S. Attorney’s Office has successfully prosecuted three cases that reflect the broad spectrum of criminal activity associated with prescription drug abuse.
Most recently, nine of eleven defendants were sentenced for participating in a scheme to obtain and sell painkillers using forged prescriptions. “Many of the defendants sentenced were themselves addicts, some of whom became addicted after receiving a lawful prescription for oxycodone,” said Yates. “Some of them even engaged in further criminal behavior to feed their own addiction. These criminal acts also perpetuated the addiction of others by putting the drugs on the street. It’s a terrible cycle.”
According to United States Attorney Yates, the charges and other information presented in court in the prosecution of eleven defendants: Holly Worley forged prescriptions for oxycodone using the names of actual doctors. The remaining ten defendants would then present the forged prescriptions at numerous pharmacies throughout the Atlanta and North Georgia area to obtain what appeared to be legitimately obtained pain medication. Once the conspirators received the drugs, Worley and Jason Johns would deliver the drugs to others to have them sold on the streets. Worley rewarded the co-conspirators for the participation with either cash or a portion of their oxycodone pills.
All eleven defendants pleaded guilty to conspiring to possess oxycodone with intent to distribute, and many were sentenced by United States District Court Judge Orinda D. Evans on June 19 and 20, 2014:
• Holly Noel Worley, 29, of Cuming, Ga., received a sentence of eight years in prison, to be followed by three years of supervised release;
• Jason Cody Johns, 30, of Gainesville, Ga., received a sentence of eight years, seven months in prison, to be followed by three years of supervised release;
• Shayna Marie Massara, 23, of Alpharetta, Ga., received a sentence of five years of probation with a condition of eight months of home confinement;
• Kelly Webb Ardizone, 26, of Cumming, Ga., received a sentence of two years, three months in prison, to be followed by three years of supervised release;
• Michael Ardizone, 28, of Cumming, Ga., received a sentence of one year in prison, in addition to receiving credit for an additional 18 months already served, to be followed by three years of supervised release;
• Keva Lee Hamrick, 23, of Cumming, Ga., received a sentence of five years of probation;
• Andrew Derek Johnson, 30, of Lawrenceville, Ga., received a sentence of two years in prison;
• Tyler Starnes Newsom, 24, of Suwanee, Ga., received a sentence of two years, six months in prison, to be followed by three years of supervised release;
• James Cory Linder, 24, of Roswell, Ga., received a sentence of two years in prison.
James Brandon Sweatman, 27, and Brian Thompson Myers, 33, both of Cumming, Ga., are scheduled to be sentenced on July 7, 2014.
“This case demonstrates cycle of harm caused by the abuse of prescription drugs,” said U.S Attorney Yates. “Through the combination of incarceration and substance abuse treatment, we hope to break this cycle so that the defendants can become productive members of society.”
Prescription drug abuse manifests itself in many different ways. Falsifying prescriptions, theft, or just purchasing pills on the street are some of the more popular methods of illegally obtaining oxycodone. However, many abusers of prescription drugs also obtain oxycodone from illegitimate pain clinics, known as “pill mills.”
“Illegitimate pain clinics prey on so-called patients who are addicted to opiates,” said Harry S. Sommers, the Special Agent in Charge of the DEA Atlanta Field Division. “Some of the doctors who dispense these addictive analgesics often operate under the guise of a stethoscope and a white coat, when in actuality they are nothing more than drug traffickers.”
In one recent “pill mill” prosecution, Jason Cole Votrobek and Roland Rafael Castellanos were non-physician owners of the ‘Atlanta Medical Group’ (AMG) medical clinic in Cartersville, Ga., which served as a front for the mass distribution of addictive pain killers.
“The defendants in this case preyed upon those addicted to prescription drugs in order to line their own pockets,” said Yates.
In their respective capacities, Votrobek and Castellanos, along with Jesse Violante, financed the clinic and worked to procure and distribute oxycodone pills to addicts and distributors. Votrobek, Castellanos, and Violante directed the clinic’s doctors to see as many patients as possible, and to prescribe as many oxycodone pills as possible, in order to generate mass profits. Dr. James Chapman allegedly did so, however, without conducting sufficient medical examinations and, indeed, according to evidence produced at trial, was frequently incapacitated due to intoxication. Tara Atkins served as the office manager. She filled out prescriptions for the doctor to sign, and the amounts of pills distributed to patients were excessive, and with unusual dosage patterns.
Evidence offered at trial established that the clinic was really a drug distribution operation with over 98 % of its patients traveling to the clinic from surrounding states, the majority from Kentucky and Tennessee. Many of those visiting had obvious signs of being addicts. The clinic engaged in unusual practices, like, permitting non-medical staff to assist with medical procedures, such as taking blood pressure, to maximize the number of patients seen. Indeed, in 2011, the clinic was one of the ‘Top 15’ purchasers of oxycodone in the nation. Votrobek and Castellanos made millions of dollars during the clinic's approximately one year of operation. Votrobek and Castellanos established multiple bank accounts, many in third party names, to conceal the windfall profits.
Jason Cole Votrobek had previously been acquitted in Florida of similar charges stemming from his ownership of a Florida pain clinic. During trial, the government offered evidence that Votrobek, 30, of Vero Beach Fla., Roland Rafael Castellanos, 34, of Hollywood, Fla., and Jesse Violante, 35, of Vero Beach, Fla., financed and operated the clinic. Tara Atkins, 36, of Cartersville, Ga., served as the office manager. Dr. James Chapman, 64, of Macon, Ga., served as the primary doctor.
Both Votrobek and Castellanos were convicted on March 26, 2014, after a month-long jury trial on federal drug and money laundering charges for owning and operating the AMG pain clinic, and, on June 19, 2014, they were each sentenced to 15 years in federal prison. Jesse Violante was sentenced to four years and four months in prison and Tara Atkins was sentenced to two years in prison. Dr. James Chapman is presently awaiting trial.
In another recent case, Gerald Young and Rodney Strachan were two Florida men who supplied large amounts of the prescription narcotic oxycodone to pill distributors in northwest Georgia. They were sentenced to federal prison in February 2014.
Young and Strachan stockpiled copious amounts of oxycodone pills, which they would then provide to John Gregory Alvarez and his co-conspirators on consignment. Alvarez’s drug trafficking organization was part of a thirteen-person conspiracy that distributed oxycodone in northwest Georgia and laundered the proceeds of the illicit sales of the pills. The organization obtained the vast majority of its pills from Florida. Specifically, Alvarez, and later co-defendants that he recruited, would travel to Florida on a monthly basis to obtain prescription oxycodone painkillers from both Young and Strachan.
Members of the Alvarez organization would sell the pills for a profit, and then reinvest the proceeds into the organization by using the funds to pay for the previous month’s supply of narcotics. The reach of this organization’s illegal oxycodone distribution included not only the northwest Georgia area, but also extended into Tennessee, West Virginia, and Kentucky. Investigators determined that this conspiracy was responsible for trafficking hundreds of thousands of oxycodone pills.
Young, 69, of Ft. Lauderdale, Fla., was sentenced to ten years, one month in prison to be followed by three years of supervised release. Strachan, 58, of Pompano Beach, Fla., Strachan was sentenced to nine years in prison to be followed by three years of supervised release. They were the last defendants to be sentenced for their roles in this oxycodone distribution ring based in Rossville, Ga. For his role in leading the northwest Georgia drug trafficking organization, Alvarez was sentenced on October 21, 2011, to 21 years, ten months in prison to be followed by six years of supervised release.
“The significant sentences imposed for Young and Strachan are another indicator of our office’s continued commitment to ending the illegal distribution of prescription painkillers in our community,” said Yates. “In recent years, the abuse of oxycodone has risen to epidemic proportions, and fatal overdose rates continue to rise. Anyone who is involved in the illegal acquisition and distribution of pain killers, including unscrupulous doctors, pharmacists, or clinic owners, is on notice that they will be found out and prosecuted.”
In addition to prosecuting criminal cases, the U.S. Attorney’s Office has conducted outreach events to spread the warning to Georgia communities about the dangers of prescription drug abuse and the need for treatment and services for those who become addicted to the substances. In 2011, the office hosted a prescription drug summit at Georgia State University that brought together speakers from national and local law enforcement agencies, medical experts in prescription drug abuse, pharmacists, and substance abuse counselors, to explore the scope of the prescription drug abuse problem and steps to address the problem. In 2014, the office hosted a second summit focusing on the rising dangers of synthetic drugs, convening law enforcement together with medical experts, educators, and university and school officials to publicize the devastating effects of these drugs and how we can best target the problem.
The Worley case was prosecuted by Assistant United States Attorney Elizabeth M. Hathaway, and it was investigated by Special Agents of the Drug Enforcement Administration, the Forsyth County Sheriff’s Office, Dawson County Sheriff’s Office, and the Georgia Drugs and Narcotics Agency.
The Votrobek and Castellanos case was prosecuted by Assistant United States Attorneys G. Scott Hulsey, Cassandra J. Schansman, and Laurel R. Boatright, and investigated by the Georgia Bureau of Investigation, Drug Enforcement Administration’s Diversion Group, Bartow/Cartersville Drug Task Force, Georgia Drugs and Narcotics Agency, and the Internal Revenue Service-Criminal Investigation; with special assistance from the Tennessee Bureau of Investigation and the Kentucky State Police.
Assistant United States Attorney C. Brock Brockington prosecuted the Young and Strachan case, and the investigation was conducted by Special Agents of the Drug Enforcement Administration, officers of the Lookout Mountain Judicial Circuit Drug Task Force, and deputies of the Catoosa County Sheriff’s Office.
The U.S. Attorney’s Office in Atlanta recommends parents and children learn about the dangers of drugs at the following web site: www.justthinktwice.com .
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao/gan/.New York Resident Admits Operating Investor Fraud SchemeRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that CHARLES PRINCIPATO, 52, of Rye, N.Y., pleaded guilty on Monday in New Haven federal court to engaging in a scheme to defraud investors of more than $1.3 million.
According to court documents and statements made in court, between approximately January 2011 and February 2014, PRINCIPATO acted as principal of Prince Direct, Inc., an entity that he represented to victim-investors as being in the business of marketing products through advertising such as “infomercials.” PRINCIPATO solicited money from victims, including Connecticut residents, for the stated purpose of funding the business operations of Prince Direct. However, instead of using victims’ money for the stated purposes, PRINCIPATO used it for his own personal expenses, including for vacations and home renovations, and for gambling. Through this scheme, PRINCIPATO defrauded victim-investors of more than $1.3 million.
On June 23, 2014, PRINCIPATO waived his right to indictment and pleaded guilty before Chief U.S. District Judge Janet C. Hall in New Haven to one count of wire fraud. Judge Hall scheduled sentencing for October 7, 2014, at which time PRINCIPATO faces a maximum term of imprisonment of 20 years.
PRINCIPATO is currently released on a $250,000 bond.
This matter has been investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant U.S. Attorney Susan L. Wines.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Nampa Man Pleads Guilty to Drug ChargeRead the Press Release
BOISE – Martin Adam Hernandez, 23, of Nampa, Idaho, pleaded guilty yesterday in United States District Court to conspiring to distribute methamphetamine, U.S. Attorney Wendy J. Olson announced.
According to the plea agreement, Hernandez admitted that in February 2014, he traveled with co-defendant Jason Martin to California in order to obtain methamphetamine. On February 21, 2014, law enforcement agents stopped a vehicle driven by Jason Martin. During a search of the vehicle, agents located approximately two pounds of methamphetamine. Agents recovered evidence showing that Hernandez and Martin obtained the methamphetamine from California with the intent to distribute the methamphetamine in Idaho.
Hernandez is scheduled to be sentenced on September 17, 2014, before Chief U.S. District Judge B. Lynn Winmill at the federal courthouse in Boise. Hernandez faces up to 20 years in prison, a maximum fine of $1 million, and at least three years of supervised release. Co-defendant Jason Martin is scheduled to enter a guilty plea to the same charge on July 1, 2014.
The case was investigated by the Drug Enforcement Administration and the Ada County Sheriff’s Office. The case was prosecuted by the Special Assistant U.S. Attorney hired by the Treasure Valley Partnership and the State of Idaho to address gang crimes. The Treasure Valley Partnership is comprised of a group of elected officials in southwest Idaho dedicated to regional coordination, cooperation, and collaboration on creating coherent regional growth. For more information, visit treasurevalleypartners.org.
More Than 350 Youths Attend Anti-Violence Summit at Friendship Collegiate Academy in Northeast Washington Fourth Annual Event Is Led by U.S. Attorney’s Office and Its Community Partners; U.S. Attorney Machen Urges Youths to “Be A Voice for Positive ChangeRead the Press Release
WASHINGTON - U.S. Attorney Ronald C. Machen Jr., the U.S. Attorney’s Office for the District of Columbia, and numerous community partners today hosted an anti-violence summit attended by more than 350 youths in Northeast Washington.
The fourth annual youth summit took place at Friendship Collegiate Academy and featured discussions about the importance of speaking out against violence and other topics, including the consequences of drug use, the importance of making good decisions, cyber-bullying, and Internet Safety. The event’s co-sponsors included the Project Safe Neighborhoods Task Force, the Columbia Heights/Shaw Family Support Collaborative, the East River Family Strengthening Collaborative, and other law enforcement and community partners.
“We’re here today because we can put an end to this senseless violence,” U.S. Attorney Machen told the youths. “If just one of you listens and thinks twice when you are at that crossroads in your life -- before picking up that gun, before getting in that car where there is nothing but trouble – then this day will be well worth it. You must protect your future at all times. It is your responsibility and yours alone.”
U.S. Attorney Machen concluded his remarks with this challenge: “Ask yourself: Are you willing to stand up for what you believe and know in your heart is the right course of action? Are you willing to say no to drugs, no to abuse, no to bullying, no to hatred, no to retaliation? I believe that each one of you has the strength and courage to do so and in doing so becoming a leader for our community. You can be a voice for positive change.”
The event, emceed by DJ Flava of WKYS Radio (93.9 FM), featured speakers, entertainment, and invaluable resources. Performers included Young Motive, KRU3H, and Main Girl.
The summit assembles young people from under-served neighborhoods in the District of Columbia to discuss the most pressing public safety challenges facing their communities. Previous summits also attracted more than 300 youth participants. The goal is to reach out to area youth on current public safety topics in an informative and inspiring way.
Several collaborative partners joined in the day’s programs, including the Ward 3 and 4 D.C. Prevention Center; the Metropolitan Police Department; the Street Wize Foundation; Black Women for Positive Change; Friendship Collegiate Academy; the National Institute on Drug Abuse; the Street Wize Foundation; and the National Center for Missing and Exploited Children. The effort is supported by Project Safe Neighborhoods, a Department of Justice initiative aimed at reducing gun and gang crimes.
The youth summit is one in a series of community events sponsored by the U.S. Attorney’s Office for the District of Columbia, including town hall meetings, crime prevention presentations, and various outreach programs for people of all ages.
14-153Miami-Dade County Resident Pleads Guilty in Stolen Identity Income Tax Refund Fraud SchemeRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, José A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), and Ronald J. Verrochio, Inspector in Charge, U.S. Postal Inspection Service (USPIS), announce that Crystal Booker, 31, Miami-Dade County pled guilty today to one count of filing a false claim with the IRS, in violation of Title 18, United States Code, Section 287. Sentencing is scheduled for September 5, 2014. At sentencing, Booker faces a maximum term of five years in prison.
According to court documents, defendant Orlando Cairo, 32, Miami-Dade County, was involved in a stolen identity income tax refund fraud scheme where he obtained the names, social security numbers, and other personal identifying information of individuals and unlawfully used this information to file and cause to be filed fraudulent income tax returns with the IRS. The returns reported false withholdings and requested refunds based on fraudulent IRS Forms W2-G, purportedly issued by the Florida Lottery Commission when an individual has gambling income exceeding a certain threshold amount.
According to court records, Booker assisted Cairo in this scheme by opening approximately eighteen bank accounts at financial institutions located in Broward and Miami-Dade counties. The fraudulent refunds that the IRS paid out were deposited into these bank accounts. Cairo filed and caused to be filed 378 returns identifying one of Booker’s accounts as the account where the refund should be deposited. The returns requested $2,128,841 in fraudulent refunds. In furtherance of the scheme, Cairo, with Booker’s assistance, presented to the IRS a fraudulent tax return, which claimed an income tax refund of $7,064. The refund was paid into one of the bank accounts that Booker opened.
On May 14, 2014, Cairo was sentenced to 120 months in prison, to be followed by three years of supervised release, and was ordered to pay $277,133.58 in restitution. He pled guilty to one count of wire fraud, in violation of Title 18, United States Code, Section 1343, and one count of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A.
Mr. Ferrer commended the investigative efforts of IRS-CI and USPIS. The case is being prosecuted by Assistant U.S. Attorney Bertha R. Mitrani.
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.