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Wednesday 4 June 2014
Toledo Man Faces Child Pornography ChargesRead the Press Release
An indictment was filed charging Jason H. Quinney age 39, of Toledo, Ohio, with receipt and distribution of child pornography and possession of child pornography, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
If convicted, the defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The investigating agency in this case is the United States Secret Service, Toledo, Ohio. The case is being handled by Assistant United States Attorney Michael J. Freeman.
An indictment is only a charge and is not evidence of guilt. Defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Tennessee, Virginia, and North Carolina Methamphetamine Cooks Sentenced to Federal PrisonRead the Press Release
GREENEVILLE, Tenn. – Three individuals were sentenced on June 4, 2014, by the Honorable J. Ronnie Greer, U.S. District Judge, for their involvement in a conspiracy to manufacture methamphetamine. John G. Reece, II, 33, of Bristol, Va., was sentenced to serve 132 months in federal prison, to be followed by five years of supervised release. Benjamin T. Morefield, 33, of Mountain City, Tenn., was sentenced to serve 119 months in federal prison, to be followed by five years of supervised release. John D. Reece, 35, of Boone, N.C., was sentenced to serve 118 months in federal prison, to be followed by five years of supervised release. There is no parole in the federal system.
A total of 20 individuals, including the three sentenced yesterday, were indicted in May 2013 for conspiring to manufacture methamphetamine and possessing equipment, chemicals, materials, and products to be used in the manufacture of methamphetamine. Seven individuals named in the indictment were also charged with distributing methamphetamine. All others charged in this case have been adjudicated guilty and will be sentenced later this year. /p>
The charges stem from a lengthy investigation spanning from August 2006 to May 2013 involving a conspiracy by these individuals to obtain pseudoephedrine and other products needed to manufacture methamphetamine in the Eastern District of Tennessee, Western District of North Carolina, and Western District of Virginia. The pseudoephedrine and other products were then used to manufacture methamphetamine utilizing the “shake and bake” method. The methamphetamine was used and distributed in the Eastern District of Tennessee.
According to the information contained in their plea agreements on file in U.S. District Court, all three of the individuals sentenced yesterday were methamphetamine cooks and had manufactured substantial quantities of methamphetamine. In their plea agreements, John G. Reece, II, and Morefield each admitted that they had conservatively manufactured at least 50 but less than 150 grams of actual methamphetamine. John D. Reece admitted in his plea agreement that he had conservatively manufactured 76.3 grams of actual methamphetamine.
“This case is an example of the effectiveness of coordinated law enforcement investigations. These individuals conspired in three different jurisdictions to manufacture methamphetamine. We greatly appreciate the efforts of the law enforcement agencies involved in all three jurisdictions to ensure that this case was successfully prosecuted to protect our communities from the dangers associated with the manufacture of methamphetamine,” said U.S. Attorney William C. Killian.
This investigation was a result of the collaborative efforts of the Johnson County Sheriff’s Office, First Judicial District Drug Task Force, Tennessee Methamphetamine and Pharmaceutical Task Force, and Drug Enforcement Administration. Assistant U.S. Attorneys Suzanne Kerney-Quillen and Caryn Hebets represent the United States.
This case was brought as a part of the Organized Crime and Drug Enforcement Task Force (OCDETF), the centerpiece of the Department of Justice=s drug supply reduction strategy that attacks major drug trafficking and money laundering organizations.
Strongsville Pharmacist Charged with Illegally Selling OpioidsRead the Press Release
A federal grand jury returned a 53-count criminal indictment yesterday charging pharmacist Osama Salouha, age 41, his wife Samah Salouha, age 36, both of Strongsville, Ohio, and pharmacist Sbeih Sbeih, age 45, of North Olmsted, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Osama Salouha was charged with using his pharmacies, Southside Pharmacy in Lorain and Medicine Center Pharmacy in Elyria, to sell opioids and opiates illicitly.
Osama Salouha, a pharmacist, was charged with 16 counts related to the dispensation of controlled substances, as well as two money laundering counts, six tax counts, 12 structuring counts and two counts of making false statements to law enforcement.
Samah Salouha was charged with one count each of structuring and false statements.
Sbeih Sbeih, a pharmacist, was charged with one money laundering count and four tax counts.
“The opioid and heroin epidemic in this state is fueled by drug dealers out to make money,” Dettelbach said. “Whether the evidence leads to a cartel, a stash house or behind a pharmacy counter, we will follow it, and we will hold these profiteers accountable.”
“Hiding income, structuring financial transactions to avoid currency requirements and filing false returns is not tax planning; it’s tax fraud. It’s a felony offense that carries severe consequences,” said Kathy Enstrom, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office. “The IRS stands ready to partner with all law enforcement agencies to pursue individuals who commit these types of crimes that damage our community and the integrity of our tax system.”
The indictment alleges that Osama Salouha used his pharmacist’s license to illegally distribute Schedule II controlled substances like oxycodone and oxymorphone to customers at Southside Pharmacy in Lorain, Ohio, and Medicine Center Pharmacy in Elyria, Ohio. Mr. Salouha also made false statements to law enforcement about his prescription drug distribution.
“Pharmacists are licensed to dispense controlled substances to real patients with legitimate prescriptions," said Denise Foster, Group Supervisor DEA Cleveland Resident Office Tactical Diversion Squad. "It is alleged that these individuals abused their positions of trust and endangered the lives of countless people by illegally distributing opiate painkillers throughout Northeastern Ohio. Despite their professional status, these individuals elected to use their pharmaceutical training to feed the habits of drug abusers and acted just like the street corner drug dealers."
Osama Salouha and his co-owner of Southside Pharmacy, Sbeih Sbeih, also engaged in a conspiracy to launder money to conceal the proceeds to avoid transaction reporting requirements. And Osama Salouha committed international money laundering through wire transfers to bank accounts overseas.
Osama Salouha and Sbeih conspired to defraud the IRS by concealing their income on their corporate and individual income tax returns, which understated the amount of income that Southside Pharmacy was earning. Mr. Salouha made false statements to law enforcement about his income tax.
Osama and Samah Salouha engaged in structuring cash deposits to bank accounts to avoid the generation of currency transaction reports, and Mrs. Salouha made false statements to law enforcement about her efforts to structure the deposit of cash.
If convicted, a defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case was investigated by the Drug Enforcement Administration, the Internal Revenue Service, the Federal Bureau of Investigation, Ohio Board of Pharmacy, Ohio Bureau of Criminal Investigations, the Akron Police Department, Cuyahoga County Sheriff’s Office, Lake County Drug Task Force, Summit County Sheriff’s Office, Lorain County Drug Task Force, Strongsville Police Department, MEDWAY Drug Enforcement Agency, and the Cleveland Heights Police Department.
The case is being handled by Assistant United States Attorneys Michael Collyer and Linda Barr.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
St. Paul Man Pleads Guilty to Bank RobberyRead the Press Release
MINNEAPOLIS — Last week in federal court, a 47-year-old St. Paul man pleaded guilty to robbing two banks. Maurice Dixon specifically pleaded guilty to two counts of Bank Robbery. Dixon, who was indicted on December 17, 2013, entered his guilty plea before United States District Court Judge John R. Tunheim on May 29, 2014.
In his plea agreement, Dixon admitted that on November 4, 2013, he walked into the University Avenue branch of TCF Bank in St. Paul and gave a teller a note demanding money. Following the robbery, an audit conducted by TCF Bank determined that the bank had suffered a loss of $768. Dixon also admitted that on November 9, 2013, he robbed the Lexington Parkway North branch of TCF Bank in the same manner. Following the robbery, Dixon was apprehended a short distance from the bank. When the defendant was taken into custody, he was found to have $175 on his person.
In addition to the November 4 and November 9 bank robberies, Dixon also admitted that he robbed another TCF Bank in Minneapolis on November 5, and between October 10, 2013 and November 9, 2013, engaged in a robbery spree where he robbed several retail establishments, including numerous Subway locations, a White Castle, and a Little Caesar’s Pizza restaurant.
“These repeated robbery cases are particularly troublesome,” stated United States Attorney Andrew M. Luger. “I am pleased that police were able to connect these robberies and end the defendant’s spree.”
This case is the result of an investigation by the St. Paul Police Department, the Minneapolis Police Department, the Woodbury Police Department, the Roseville Police Department, and Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorney Kevin S. Ueland.St. Louis County Man Indicted on Tax and Weapons ChargesRead the Press Release
St. Louis, MO – JOEY D. WOOD was indicted for allegedly filing six false tax returns for himself and three others claiming refunds totaling over $27,000 for tax years 2011 and 2012.
According to the indictment, Wood filed false tax returns for himself claiming refunds for 2011 and 2012, and filed false returns claiming refunds for three other people for the same years. The indictment also alleges that on May 17, 2013, Wood was in possession of one or more firearms. Due to a previous felony conviction, he is prohibited from owning or possessing firearms.
Wood, St. Louis County, MO, was indicted by a federal grand jury on six felony counts of filing false tax returns and one felony count of being a previously convicted felon in possession of a firearm. The indictment was returned May 28th, but remained sealed until the arrest of the defendant earlier today.If convicted, each of the tax counts of the indictment carries a maximum penalty of five years in prison and/or fines up to $250,000, the firearms charges carries a maximum of 10 years in prison and/or fines up to $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by IRS Criminal Investigation, the St. Louis County Police Department and the Missouri Department of Revenue. Assistant United States Attorney Steven Muchnick is handling the case for the U.S. Attorney's Office.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
Solon Couple Sentenced to Prison for Medicaid FraudRead the Press Release
A Solon couple that owned an ambulette company was sentenced to prison and ordered to pay restitutuion for defrauding Ohio Medicaid, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Ohio Attorney General Mike DeWine.
Temeca Hamilton was sentenced to 33 months in prison after pleading guilty to nine counts of health care fraud and one count of witness tampering. Antwain Hamilton was sentenced to 30 months in prison after pleading guilty to nine counts of health care fraud.
The court ordered both defendants to pay $823,283 in restitution.
The Hamiltons, both 37, operated their business Star Medical out of Maple Heights, Ohio.
“The punishment in this case reflects the brazen fraud in which these defendants engaged. Even after they knew they were under investigation, they kept defrauding the Medicaid program. Now, it is the defendants who must pay for their corrupt actions,” Dettelbach said.
“In some cases, our investigation found that this couple billed for ambulette runs that they claimed they made at the same time that they were vacationing out of state,” said Attorney General DeWine. “These individuals took lavish trips with the money that they weren’t entitled to and didn’t work for, and now they must pay the price by repaying those funds and serving jail time.”
Ambulette services contract with the Ohio Medicaid program to transport patients in vehicles known as ambulettes. An ambulette is a specially equipped van designed for wheelchair passengers. Medicaid pays ambulette operators for driving Medicaid patients to and from Medicaid-covered appointments, so long as: (1) the patient rides in a wheelchair; (2) a medical doctor certifies the need for the wheelchair and ambulette; and (3) the ambulette itself otherwise meets safety specifications.
The defendants were convicted of illegally charging Medicaid for rides of patients who did not use or need wheelchairs and for billing Medicaid for ambulette attendants, when no such attendants were used by Star Transport. The defendants also billed Medicaid for transports that never occurred, including instances when the defendants were taking Caribbean cruises and vacationing in Hawaii, Cancun, Mexico, and Las Vegas. Both defendants also continued to submit fraudulent billing after Medicaid suspended payments and after the U.S. Attorney’s Office sent them a letter informing them that they were targets of a federal criminal investigation. Temeca Hamilton tampered with a witness, a Medicaid recipient, by asking the witness to tell law enforcement that she been receiving transportation services from Star Transport for the last five years, which was false.
The case was prosecuted by Assistant U.S. Attorney Michael L. Collyer and Special Assistant U.S. Attorney Constance Nearhood, an Assistant Attorney General for the State of Ohio, after an investigation by Ohio Attorney General Mike DeWine’s Medicaid Fraud Control Unit and the Office of the Inspector General, United States Department of Health and Human Services.
Anyone suspecting health care fraud, waste or abuse can report it by calling the U.S. Department of Health and Human Services, Office of Inspector General at 800-447-8477. To learn more about health care fraud prevention and enforcement go to www.medicare.gov
Shooting Range Owner Indicted for Illegal Firearms SalesRead the Press Release
RENO, Nev. – A federally-licensed firearms dealer and owner of an indoor shooting range in Reno, Nev., was indicted today by the federal grand jury on charges that he unlawfully sold multiple firearms, including guns with obliterated serial numbers and machine guns, to undercover ATF agents at his business in April and May 2014, announced Daniel G. Bogden, United States Attorney for the District of Nevada and Joseph M. Riehl, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives.
“Federally licensed firearms dealers are entrusted to uphold federal laws pertaining to the importation, manufacture and sales of firearms,” said U.S. Attorney Bogden. “We will be especially vigilant in our investigations and prosecutions of firearm dealers who consciously choose to violate these laws.”
James David Harwin, 59, of Reno, is charged in a six-count federal indictment with one count of illegal sale by a federally licensed dealer to an out-of-state resident, one count of possession of a firearm with an obliterated, removed or altered serial number, three counts of transfer of a firearm in violation of the National Firearms Act, and one count of obliteration, alteration, or removal of the serial number of a firearm. Harwin, who was previously charged by criminal complaint, is currently in federal custody, and is scheduled for an arraignment and plea on June 12, 2014, at 3:00 p.m. If convicted, he faces up to five years in prison on the illegal sale charge and up to 10 years in prison on each of the other five counts, as well as fines of up to $250,000 on each count.
According to the allegations in the criminal complaint and indictment, James Harwin and Safe Shot LLC possessed a Federal Firearms License to manufacture and sell firearms. Safe Shot LLC did business as the Safe Shot Indoor Shooting Range, located at 9425 Double R Boulevard in Reno. On or about April 17, 2014, Harwin unlawfully sold four handguns to two undercover ATF agents who told Harwin they were residents of Sacramento, Calif. One of the handguns had an obliterated serial number. On May 2, 2014, Harwin sold a machine gun with an obliterated serial number to the undercover ATF agents, and on May 29, 2014, Harwin unlawfully sold a Street Sweeper shotgun and three machine guns to the undercover agents. Harwin removed the serial numbers on one of the machine guns in the presence of the undercover agents.
“ATF is charged with ensuring compliance of all applicable laws and regulations as it relates to licensed federal firearms dealers,” said Special Agent in Charge Riehl. “We will aggressively pursue those individuals, including federally licensed dealers who try to circumvent and violate the federal firearms laws, in an effort to protect the public and prevent unlawful machine guns and other firearms from getting into the hands of criminals.”
This case is being prosecuted by Assistant U.S. Attorney Megan Rachow and investigated by ATF.
The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.Serial Bank Robber Pleads GuiltyRead the Press Release
Marcus Akiem Ricketts, 37, of Boyertown, PA, pleaded guilty yesterday to four armed bank robberies in Pennsylvania and using and carrying a firearm during a crime of violence. Ricketts was charged, federally, with four robberies: on June 8, 2010, at the Sovereign Bank, located at 258 East High Street, Pottstown, Pennsylvania; on January 24, 2012, at the Citizens Bank, located at 209 Lancaster Avenue, Devon, Pennsylvania; on April 12, 2012, at the First Niagara Bank, located at 502 State Avenue, Emmaus, Pennsylvania; and on July 2, 2012, at the Manufacturers and Traders Trust Company (“M&T Bank”), formerly located at 760 North Pottstown Pike, in Exton, Pennsylvania. In addition to those robberies, Ricketts pleaded guilty to seven others. The banks were located in Bucks, Berks, Chester, Delaware, Lehigh, and Montgomery counties. Ricketts admitted to committing 11 total bank robberies, six of which were pending investigation.
Ricketts faces 25 years in prison including a seven year mandatory term, five years of supervised release, a fine of up to a $1.25 million, a $500 special assessment and restitution of approximately $194,436. A sentencing hearing is scheduled for September 17, 2014.This case was investigated by the Federal Bureau of Investigation, the Pennsylvania State Police, the Chester County Sheriff’s Department, the Chester County Detectives, and the police departments for Easttown Township, Emmaus, Lower Merion, Pottstown, Uwchlan, Shillington Township, Warminster, and West Whiteland, Pennsylvania. In addition, the District Attorney’s offices for the counties of Berks, Bucks, Chester, Lehigh and Montgomery were also involved in the investigation. This case is being prosecuted by Assistant United States Attorneys Jeffery W. Whitt and Jessica Natali.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Rochester Man Pleads Guilty to Resisting Impeding Secret Service AgentsRead the Press Release
ROCHESTER, N.Y. C U.S. Attorney William J. Hochul, Jr., announced today that Christopher Ludwig, 31, of Rochester, N.Y., pleaded guilty to resisting and impeding officers before U.S. District Judge Charles J. Siragusa. The charge carries a maximum penalty of one year in prison, a fine of $100,000, or both.
Assistant U.S. Attorney Tiffany H. Lee, who is handling the case, stated that on April 26, 2012, the defendant called the Monroe County Board of Elections and made a threatening remark concerning President Barack Obama. On May 3, 2012, when Special Agents with the United States Secret Service went to Ludwig’s residence, he forcibly resisted and impeded efforts to place him under arrest.
The plea is the culmination of an investigation on the part of the United States Secret Service, under the direction of Special Agent in Charge Tracy Gast.
Sentencing is scheduled for September 5, 2014 at 9:15 a.m. before Judge Siragusa.Richmond Developer Pleads Guilty to Unlawful Transfer of A False Identification Document and Aggravated Identity TheftRead the Press Release
RICHMOND, Va. – Billy Gene Jefferson, Jr., 52, of Richmond, Va., pleaded guilty today to Unlawful Transfer of a False Identification Document and to Aggravated Identity Theft. He faces a maximum penalty of 15 years’ imprisonment on the Unlawful Transfer charge, to be followed by a mandatory 2 year consecutive sentence for the Aggravated Identity Theft. He also faces a fine of up to $500,000 and 3 years of supervised release at the time of sentencing. In the plea documents, the United States also reserved the right to argue for an upward variance or departure at sentencing based on the defendant’s obstruction of justice and related conduct that formed the basis for the allegations in Count One of the indictment.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; Mark R. Herring, Attorney General of Virginia; Thomas J. Kelly, Special Agent in Charge of the Internal Revenue Service Criminal Investigation’s Washington, D.C., Field Office; Adam S. Lee, Special Agent in Charge of the FBI’s Richmond Field Office; Gary Barksdale, Inspector in Charge of the United States Postal Inspection Service, Washington, D.C. Division; and Colonel W. Steven Flaherty, Superintendent of Virginia State Police, made the announcement after the plea was accepted by United States District Judge John A. Gibney, Jr.
At this time, Jefferson is also awaiting sentencing on Case No. 3:13CR221. In that case on December 19, 2013, Jefferson pleaded guilty to Major Fraud Against the United States and Engaging in Unlawful Monetary Transactions. For those charges, he faces a maximum penalty of 20 years in prison, restitution to the victims, a fine of up to $500,000, and three years of supervised release when he is sentenced on September 9, 2014. In supplemental plea documents filed in that case today, the parties removed a previous provision that called for an agreed sentencing recommendation to the Court. The United States also reserved the right to argue for an upward departure or variance for the defendant’s conduct that formed the basis for the United States’ Motion for Hearing Regarding Defendant’s Breach of Plea Agreement. The parties revised procedures to determine the final restitution amount depending on the final resolution of an IRS audit on a portion of the federal losses.
In the Statement of Facts filed in connection with today’s guilty plea, Jefferson admitted that on October 26, 2013, he created and transferred a false identification document, namely an Arkansas Driver’s License in the name of “Actual Person” (the individual referenced in the pending indictment is Jefferson’s brother, J.W.J.) with the defendant’s photograph, knowing that the document was produced without lawful authority. The defendant agreed that the Arkansas Driver’s License was of the type intended and commonly accepted for identifying an individual that was not issued under the authority of the State of Arkansas. Jefferson, posing as the “Actual Person” (referring to J.W.J.) on the fraudulent Arkansas Driver’s License, caused the email transfer of the identification and other documents to representatives from Aircraft Management Group, Inc. (AMG Jets). The transfer was in relation to the defendant’s attempt to charter a one-way flight to Cranfield, England, with a scheduled departure date of November 2, 2013. In connection with the Aggravated Identity Theft portion of the plea, the defendant admitted that he transferred, possessed, and used “Actual Person’s” (referring to J.W.J.) name and date of birth in connection with attempting to secure the charger flight. The defendant admitted that he did not have the “Actual Person’s” authority or permission to use the name and date of birth for these purposes.
This case was investigated by the Internal Revenue Service Criminal Investigation Division, Federal Bureau of Investigation Richmond Office, the United States Postal Inspection Service, and the Virginia State Police. The Virginia Department of Historic Resources also assisted law enforcement in the investigation. Assistant United States Attorneys Michael Gill and Wingate Grant and Special Assistant United States Attorney Patrick Dorgan are prosecuting the case on behalf of the United States.
This investigation has been coordinated by the Virginia Financial and Securities Fraud Task Force, an unprecedented partnership between criminal investigators and civil regulators to investigate and prosecute complex financial fraud cases in the nation and in Virginia. The task force is comprised of several federal and state agencies, including the Virginia Attorney General’s Office. The task force is an investigative arm of the President’s Financial Fraud Enforcement Task Force (FFETF), an interagency national task force.
The FFETF was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Portland Man Sentenced for Distributing Child PornographyRead the Press Release
VICTORIA, Texas – Richard R. Montez, 32, been ordered to prison following his conviction on one count of distribution of child pornography, announced United States Attorney Kenneth Magidson. Montez pleaded guilty Feb. 18, 2014.
Today, Senior U.S. District Judge John D. Rainey considered the need to protect the public and deter future criminal conduct and handed Montez a sentence of 97 months in federal prison. The sentence will be immediately followed by 10 years of supervised release during which time he will have to comply to comply with numerous requirements designed to restrict his access to children and the Internet. Montez will also be ordered to register as a sex offender.
The FBI had identified Montez in an undercover operation out of Tulsa, Okla. He had been on a file sharing network with 214 suspected files of child pornography he had made available for sharing.
On Oct. 24, 2013, FBI agents and local officers executed a federal search warrant on his Portland home. At that time, Montez admitted to using a file sharing network to acquire child pornography.
Forensic analysis of a laptop Montez owned led to the discovery of more than 500 images and more than 250 videos of child pornography.
Previously released on bond, Montez was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.
FBI investigated with the assistance of the Corpus Christi Police Department – Internet Crimes Against Children Task Force and the Portland Police Department.
This case, prosecuted by Assistant United States Attorney Lance Duke, 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."
Philadelphia Store Owner Sentenced to 30 Months’ Imprisonment for Smuggling Elephant Ivory from AfricaRead the Press Release
Earlier today, Victor Gordon was sentenced before Judge Kiyo A. Matsumoto in U.S. District Court in Brooklyn, New York, to 30 months’ imprisonment, to be followed by 2 years of supervised release, for smuggling elephant ivory into the United States. As part of that sentence, the court ordered Gordon to pay a fine of $7,500 and to forfeit $150,000, along with the approximately one ton of elephant ivory that was seized by agents from Gordon’s Philadelphia store in April 2009.
The sentence was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, and Honora Gordon, Special Agent in Charge of the U.S. Fish and Wildlife Service’s Northeast Region Office of Law Enforcement.
“The illicit trade in elephant ivory has created an environmental crisis in Africa and is fueling the development of organized criminal groups around the world,” said United States Attorney Lynch. “For this reason, the United States has committed itself, through international treaties and domestic law, to preventing the flow of illegal ivory through and within our borders. This prosecution – which resulted in the seizure and forfeiture of one of the largest known caches of illegal elephant ivory in the United States and the imprisonment of the person who acquired and attempted to profit from it – is emblematic of that commitment.” Ms. Lynch commended the agents and inspectors of the Fish and Wildlife Service for their outstanding efforts in leading the investigation.
As is described in the government’s sentencing memorandum, over a period of at least nine years, the Gordon acquired more than 400 pieces of carved elephant ivory, valued at approximately $800,000. On four occasions beginning in 2006, Gordon paid a smuggler to acquire ivory directly from Africa and then unlawfully secret it into the United States through John F. Kennedy International Airport. In some instances, Gordon stained the ivory and directed the smuggler to create false receipts in order to make it appear that the ivory had been lawfully acquired before international and U.S. law imposed strict regulations on the importation of elephant ivory in 1989. Over the years, Gordon sold tens of thousands of dollars of carved ivory to customers from his Philadelphia store, and prior to the search of the store in April 2009, was attempting to sell his business, including the ivory collection, for $20 million.
Gordon’s sentence caps an eight-year investigation that has yielded nine convictions in this district for smuggling and Lacey Act offenses relating to the illegal importation and sale of elephant ivory.
The government’s case was prosecuted by Assistant United States Attorneys Darren A. LaVerne and Claire Kedeshian.
The Defendant:
Victor Gordon
Age: 71
Penn Valley, Pennsylvania
E.D.N.Y. Docket No. CR-11-517 (KAM)
Permian Basin Law Enforcement and Medical Community Getting the Word Out on the Dangers Associated with Designer DrugsRead the Press Release
Federal, state and local law enforcement and medical authorities in the Permian Basin, led by United States Attorney Robert Pitman, Midland County District Attorney Teresa Clingman and Ector County District Attorney Bobby Bland are getting the word out about the dangers associated with synthetic cannabinoids, also known as “synthetic marijuana” and synthetic cathinones, sometimes called “bath salts.”
These synthetic drugs, often referred to as designer drugs, are novel psychoactive substances clandestinely produced to mimic the effects of marijuana, cocaine, methamphetamine, and MDMA. There is no industrial or medical use for these substances. Clandestine chemists duplicate the technical sophistication used by the legitimate drug research community to manufacture new substances which are increasingly popular among recreational drug users. The manufacturers and sellers of synthetic drugs often attempt to mislead users about the legality of the drugs and market the drugs to young people.
Synthetic cannabinoids, also known as synthetic marijuana, “Spice,” “K2,” or “Kush,” comprise a large family of chemically unrelated structures functionally similar to THC, the primary psychoactive ingredient in organic marijuana. When ingested, synthetic cannabinoids may produce less, equivalent or more psychoactive activity than THC, but often with pronounced and dangerous side-effects. Synthetic cannabinoid products consist of plant matter that is sprayed with a mixture of acetone and synthetic cannabinoid chemical compounds. These chemicals are unregulated, often produced in China, and imported to the United States where they are then applied to plant matter to render them ingestible. Generally, the product is packaged in foil baggies which falsely state that the product is “herbal incense” and “not for human consumption” in an attempt to avoid prosecution. The product may be sold in brick and mortar “smoke shops,” convenience stores, adult book stores, as well as, over the Internet. Synthetic cannabinoid products are marketed under many different names, including “Scooby Snax,” “Hysteria,” “Mad Monkey,” “Sexy Monkey,” and “Devil Eye.”
Texas poison centers report that between January 2012 and April 2014, there were 2,179 exposures to synthetic cannabinoids. The Texas Poison Center Network warns that the alarming health effects from using these drugs include severe agitation and anxiety; racing heartbeats and high blood pressure; nausea and vomiting; muscle spasm, seizure, and tremors; intense hallucinations and psychotic episodes and suicidal and other harmful thoughts and/or actions.
“Let me be clear about this. This is not marijuana. These are chemical substances that are, to the user, completely unknown and that pose potentially serious health risks. There have been reports in our own community of people, especially young people, who have had potentially serious health effects from their use,” stated U.S. Attorney Pitman. He added, “To the owners and operators of convenience stores and smoke shops who sell illegal designer drugs, we are here to tell you that this is just the beginning of our effort to enforce the law with respect to the sale of these potentially dangerous substances. To people in the community who think that designer drugs are a safe and legal option, we hope that this will provoke an understanding not just that they are illegal, but that you are playing a game of Russian roulette when you put these unregulated and unknown chemicals into your body.”
Last week, Jared William Roach, a 29-year-old former Odessa retailer, pleaded guilty to one count of possession of a synthetic cannabinoid with intent to distribute. By pleading guilty, Roach admitted to possessing “Hysteria Black” in his store, Smoke Alley, in May of last year. The contents of “Hysteria Black” included both a controlled substance as well as a controlled substance analog. Roach faces up to 20 years in federal prison.
Kelly Jay Duarte, the 22-year-old former proprietor of Urban City, a retail business in Odessa, faces up to 20 years in federal prison after pleading guilty last month to one count of possession of a synthetic cannabinoid with intent to distribute. By pleading guilty, Duarte admitted that in May 2013, synthetic cannabinoids packaged under the names of “Diablo,” “KMA,” “Mad Hatter,” and “Hypnotic Haze” were knowingly sold to customers at his business in violation of federal law. Duarte is scheduled to be sentenced on August 14, 2014, before United States District Judge Robert A. Junell in Midland.
Synthetic cathinones, which are structurally and pharmacologically similar to amphetamine, MDMA, and other related substances, are central nervous system stimulants and are sold in retail stores, on the internet, and in head shops as “bath salts,” “plant food,” or “jewelry cleaner.” Synthetic cathinone users report symptoms of increased heart rate, agitation, hypertension and hallucinations. Like the cannabinoids, the ingredients are not disclosed, the production is unregulated and there are significant batch to batch variances.
The United States Attorney’s Office prosecuted and convicted Jimmy Wright, the former owner of B & L adult bookstore in Odessa, of the federal felony criminal offense of possession with intent to distribute the synthetic cathinone, MDVP. Wright was sentenced to a 20-month term of imprisonment. He recently died in prison.
Oakland Man Sentenced to Four Years in Prison for Selling Historic Gold Jewelry Box Stolen from Oakland MuseumRead the Press Release
OAKLAND, Calif. – Andre Taray Franklin was sentenced yesterday to four years in prison for knowingly receiving and then selling an historic gold jewelry box stolen from the Oakland Museum of California, announced United States Attorney Melinda Haag and FBI Special Agent in Charge David J. Johnson.
Franklin pleaded guilty on March 7, 2014. According to the plea agreement, Franklin admitted that, in early 2013, in exchange for money, he gave a jewelry box that he knew had been stolen from the Oakland Museum of California, located at 1000 Oak Street in Oakland, Calif., to another individual.
The jewelry box was stolen from the Oakland Museum on January 7, 2013. The jewelry box was made of California gold and adorned with gold veined quartz, and had been made between 1869 and 1878. The box was recovered by the Oakland Police Department on March 6, 2013, from a business in Oakland and from the individual to whom Franklin sold the jewelry box.
“This prosecution, conviction, and sentence send a strong message that the U.S. Attorney’s Office values greatly, and will fight to protect, the museums and cultural institutions in Oakland and the Bay Area that maintain and display historic items for the public to enjoy,” states U.S. Attorney Melinda Haag.
Franklin, 46, of Oakland, was indicted by a federal grand jury on May 23, 2013, for theft of major artwork and unlawful concealment and disposition of stolen major artwork, in violation of 18 U.S.C. §§ 668(b)(1) and (b)(2).
The sentence was handed down by The Honorable Jeffrey S. White, United States District Court Judge. Judge White also sentenced the defendant to a 3-year period of supervised release.
Assistant U.S. Attorney Brian C. Lewis prosecuted this case with the assistance of Legal Assistant Janice Pagsanjan. This prosecution is the result of an investigation by Oakland Police Department and the FBI.
(Franklin criminal complaint )
(Franklin indictment )
Nigerian Fugitive Arrested for Health Care Fraud ViolationsRead the Press Release
Department of Justice
Office of Public AffairsTYLER, Texas — A 43-year-old Nigerian fugitive has been arrested at a Houston airport and will now face federal health care fraud violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales.
Vivian Yusuf, of Port Harcourt, Nigeria, the former owner of Ivy Health Care Supply, a Houston area medical supply company, was arrested on June 3, 2014 at George Bush Intercontinental Airport in Houston. Yusuf had been indicted for conspiracy to commit health care fraud, health care fraud, and aggravated identity theft and a fugitive since March 2011.
According to the indictment, from June 2007 through May 2009, Yusuf, Aghaegbuna “Ike” Odelugo, James Reese, and others carried out a scheme to defraud Medicare through the marketing of power wheelchairs and accessories, as well as “ortho kits,” which primarily consisted of a bag of orthotic items, including braces, wraps, and supports, and a heat lamp or heat pad. As part of the scheme, the defendant and her co-conspirators illegally obtained protected health information, including names, dates of birth, and Medicare numbers from elderly individuals. Yusuf and her co-conspirators supplied beneficiaries with kits and power wheelchairs which were not prescribed or otherwise authorized by a physician and which were not wanted by the beneficiaries. Claims were submitted by the defendant and her co-conspirators for approximately 790 beneficiaries located primarily in Texas and Louisiana. In some instances, physicians’ signatures were forged and false claims were submitted to Medicare in the names of Medicare beneficiaries who were deceased. By means of fraudulent billing practices, the defendant and her co-conspirators unlawfully submitted false and fraudulent claims to Medicare of more than $3.4 million and obtained more than $1.6 million.
Yusuf appeared in federal court in Houston for an initial appearance and is being transferred to the Eastern District of Texas.
Odelugo and Reese were indicted for their involvement in similar health care fraud schemes. "Ike" Odelugo pleaded guilty to conspiracy to commit health care fraud, health care fraud, and money laundering and was sentenced to 72 months in federal prison. The loss to Medicare as a result of Odelugo’s scheme was approximately $9.9 million. James Reese pleaded guilty to health care fraud and tax evasion and was sentenced to 180 months in federal prison. The loss to Medicare as a result of Reese’s scheme was approximately $8.6 million.
If convicted, Yusuf faces up to 10 years in prison for each count of conspiracy and health care fraud and up to 2 years in prison for each count of aggravated identity theft. A grand jury indictment is not evidence of guilt.This case is being investigated by the U.S. Department of Health and Human Services – Office of the Inspector General (HHS-OIG), the Texas Office of the Attorney General – Medicaid Fraud Control Unit (OAG-MFCU), and the Federal Bureau of Investigation (FBI). Assistant U.S. Attorney Nathaniel C. Kummerfeld is prosecuting this case.
#######New Haven Man Pleads Guilty to Federal Gun Charge, Faces at Least 15 Years in PrisonRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that JAMES BROWN, 34, of New Haven, pleaded guilty today before Senior U.S. District Judge Alfred V. Covello in Hartford to one count of possession of a firearm by a previously convicted felon.
According to court documents and statements made in court, on December 28, 2012, New Haven Police responded to a 911 call of a domestic dispute involving a weapon. Officers arrived at the identified residence and BROWN, who was in the bedroom, was taken into custody. A subsequent search of the bedroom revealed a loaded Smith and Wesson revolver hidden under the mattress of the bed.
Forensic analysis of the firearm revealed DNA that matched BROWN’s DNA.
BROWN’s criminal history includes convictions for unlawful restraint in the first degree, robbery in the second degree, robbery in the third degree, and sale of a controlled substance. It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.
The charge of possession of a firearm by a previously convicted felon ordinarily carries a maximum term of imprisonment of 10 years. However, BROWN is subject to the Armed Career Criminal Act, a federal law imposing severe penalties for firearm or ammunition possession by persons who have been convicted of at least three violent felonies or serious drug offenses. A defendant who qualifies as an Armed Career Criminal faces a minimum term of imprisonment of 15 years and a maximum term of life.
This matter is being investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the New Haven Police Department. The case is being prosecuted by Assistant U.S. Attorney Anthony E. Kaplan.
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[email protected]Monroe County Man Charged with Heroin Trafficking ConspiracyRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a criminal Information was filed in U.S. District Court in Scranton today charging a Monroe County resident with participating in a conspiracy to distribute heroin during November 2013 through April 2014.
According to United States Attorney Peter Smith, the Information alleges that Kerion Johnson, age 40, conspired with others to distribute and possess with intent to distribute heroin in Monroe County and elsewhere.
The charge stems from an investigation by special agents of the Federal Bureau of Investigation and the Pennsylvania State Police.
Johnson faces a potential maximum sentence of 20 years in prison and a $1 million fine if he is convicted of the charge.
The case is being prosecuted by Assistant U.S. Attorney Francis P. Sempa.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
In this case, the maximum penalty under the federal statute is 20 years imprisonment, a term of supervised release following imprisonment, and a fine. 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.
Mobile County Man Sentenced to 60 Months for Possession with Intent to Distribute 31 Grams of Crack CocaineRead the Press Release
The United States Attorney Kenyen Brown announces that Jermaine Dickinson, a 30 year old resident of Mobile, was sentenced today. Mr. Dickinson pled guilty on March 5, 2014, to possession of 31 grams of crack cocaine with the intent to distribute it.
Officers of the Mobile Police Department investigated the case and presented it to the U.S. Attorney=s Office for prosecution. The prosecutor assigned to the case is Assistant United States Attorney, Gina S. Vann.
Millvale Police Officer Charged with Unlawfully Using A Taser on A Handcuffed PersonRead the Press Release
PITTSBURGH - A Pittsburgh resident has been indicted by a federal grand jury in Pittsburgh on a charge of deprivation of rights under color of law, United States Attorney David J. Hickton announced today.
The one-count indictment, returned on June 3, named Nicole Murphy, 30, as the sole defendant.
According to the indictment, on Sept. 21, 2012, Nicole Murphy, while acting under color of law as a police officer with the Millvale Police Department, deprived an individual identified as T.S. of the constitutional right to be free from unreasonable seizure, by deploying a Taser in both drive and probe-stun modes on T.S.’s person while he was handcuffed.
The law provides for a maximum total sentence of 10 years in prison, a fine of $250,000 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Carolyn J. Bloch is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Middlesex County, N.J., Man Admits Saddle Brook Bank RobberyRead the Press Release
NEWARK, N.J. – A Middlesex County, N.J., man today admitted robbing a TD Bank in Saddle Brook, N.J., U.S. Attorney Paul J. Fishman announced.
Jorge Rodriguez, 46, of South River, N.J., pleaded guilty before U.S. District Judge William J. Martini in Newark federal court to an information charging him with one count of bank robbery.
According to documents filed in this case and statements made in court:
Rodriguez admitted using a BB air pistol to rob a TD Bank in Saddle Brook on April 19, 2013. Rodriguez entered the bank wearing a disguise, which included a hat with a dreadlocks wig attached to it. During the robbery, Rodriguez brandished the BB air pistol, handed a bag to a bank teller and said, “Give me the money or I’ll shoot. You have two seconds.” The teller complied and Rodriguez then fled the bank with the bag of money, which also included a dye pack. Rodriguez was apprehended shortly after the robbery, after the dye pack exploded.
The bank robbery count carries a maximum sentence of up to 20 years in prison and a fine of up to $250,000. Sentencing is scheduled for Sept. 23, 2014.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark, along with the Saddle Brook Police Department and the Bergen County Prosecutor’s Office for the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorneys Josh Hafetz and David M. Eskew of the Criminal Division of U.S. Attorney’s Office in Newark.
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Defense counsel: Patrick McMahon Esq., Assistant Federal Public Defender, Newark
Rodriguez, Jorge Information
Michigan Man Sentenced to Four Years in Federal Prison for Firearm ViolationRead the Press Release
BECKLEY, W.Va. – United States Attorney Booth Goodwin announced today that Thomas Glenn Speck, 37, of Fostoria, Michigan, was sentenced in federal court in Beckley to four years in prison for being a felon in possession of a firearm. Speck pleaded guilty in January 2014, admitting that on March 28, 2012, he possessed a 12-gauge shotgun at a residence where he was staying in Harper, Raleigh County, West Virginia. The firearm was found during an investigation of a confrontation between members of the Avengers Motorcycle Club and West Virginia State Troopers. Speck is prohibited from possessing firearms because he was convicted of the felony offenses of unarmed robbery and second degree home invasion in Michigan in 1999. He is currently serving a prison sentence of three to ten years in Michigan on a 2012 conviction of third degree fleeing and eluding a police officer. The federal sentence will be served after the Michigan sentence is complete.
Speck’s sentence was imposed by United States District Judge Irene C. Berger. The case was investigated by the West Virginia State Police and the Federal Bureau of Investigation. The prosecution was handled by Assistant United States Attorney John File.
Miami Man Pleads Guilty to Identity Theft and Tax Refund Fraud ChargesRead the Press Release
RICHMOND, Va. – Junior Jean Merilia, 33, of Miami, Florida, pleaded guilty today to conspiracy to commit mail and wire fraud and aggravated identity theft.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; and Thomas J. Kelly, Special Agent in Charge of Internal Revenue Service, Washington Field Office, made the announcement after the plea was accepted by U.S. District Judge Henry E. Hudson.Merilia was indicted on June 4, 2014 by a federal grand jury on a single count of conspiracy to commit mail and wire fraud. He faces a maximum penalty of twenty-two years in prison when he is sentenced on November 21, 2014.
According to the statement of facts in support of the plea and other court documents, Merilia is a co-conspirator of Ramoth Jean, who has already been prosecuted in connection with this matter. Jean was stopped by Henrico County Police in August 2012 as he removed items from a storage unit that had been rented in the name of a Florida resident without that person’s knowledge or authorization. A search of the unit yielded hundreds of cards bearing the personal identifying information of persons around the United States, pre-paid debit cards, and laptop computers used in this scheme. The pre-paid debit cards were issued in connection with tax refunds from tax returns filed on-line using stolen personal identifying information. Many of those returns were filed from hotels in the Richmond area.
Papers linked with Merilia were found in the storage unit. Merilia acknowledged in the statement of facts that he hired a website designer who created websites through which personal identifying information was stolen, via sham employment postings, for use in connection with the scheme. In addition, Merilia made ATM withdrawals in the Miami area using debit cards connected with some fraudulently filed tax returns.
On January 9, 2014, Judge Hudson sentenced Ramoth Jean to a 114 month term of incarceration following his guilty pleas to conspiracy and aggravated identity theft charges.
This case was investigated by the Internal Revenue Service—Criminal Investigations, the U.S. Postal Inspection Service, Social Security Administration—Office of Inspector General, and the Henrico County Police Department as members of the Metro-Richmond Identity Theft Task Force. Prosecutions for the Task Force are handled by the United States Attorney’s Office and the Office of the Attorney General for the Commonwealth of Virginia. Assistant U.S. Attorney Michael C. Moore is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:14-cr-73.
Mexican Nationals Charged with Illegal ReentryRead the Press Release
Two Mexican nationals were indicted on charges of unlawful reentry to the United States, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Juan Ramon Valadez-Lara, age 26, is accused of unlawfully reentering the United States on May 12, 2014.
Joel Noe Fabian-Vazquez, age 27, of Mexico, , is accused of unlawfully reentering the United States on May 21, 2014.
The cases are not related.
If convicted, the defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, and the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The investigating agency in these cases is the Department of Homeland Security, Customs and Border Protection, Port Clinton, Ohio. They are being handled by Assistant United States Attorney Noah P. Hood.
Manhattan U.S. Attorney Files Civil Injunction Lawsuit Against New York Lawyer to Block Promotion of Abusive Tax Shelter TransactionsRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and John Dalrymple, Deputy Commissioner for Services and Enforcement for the Internal Revenue Service (IRS), announced today that the United States filed a civil injunction complaint in Manhattan federal court alleging that HAROLD LEVINE, an attorney in New York, has promoted abusive tax shelters while serving as a partner and head of the tax practice group in the New York office of the law firm Herrick Feinstein LLP. LEVINE currently is a partner and chair of the tax practice group in the New York office of the law firm Moritt Hock & Hamroff LLP.
The Complaint asserts that LEVINE promoted, implemented and/or participated in at least 90 unlawful tax schemes designed to cheat the Government out of hundreds of millions of dollars in tax liability. According to the Complaint, LEVINE, operating together with other known tax-shelter promoters, used companies with phony losses on their books to shield millions of dollars of income garnered by other companies disposing of their assets. The Complaint alleges that, in an attempt to disguise the illegitimacy of these transactions, LEVINE knowingly told lies or caused the corporations involved in these unlawful transactions to tell lies concerning the supposed tax benefits of the transactions. As set forth in the Complaint, LEVINE received more than $5 million in fees as a result of his participation in these unlawful tax avoidance schemes. The Complaint seeks to bar LEVINE from organizing, promoting or selling any tax shelters that allegedly use an intermediary-type transaction or state tax credits designed to reduce or eliminate tax liabilities in the future, as well as any other plans or arrangements intended to secure tax benefits or unlawfully evade tax liabilities in exchange for fees. LEVINE may be subject to penalties in the future based on the fraudulent tax shelter conduct alleged in the Complaint.
Manhattan U.S. Attorney Preet Bharara said: “Those who promote illegal tax avoidance schemes are not simply committing a fraud on the United States Government. They are taking advantage of the hard-working, honest Americans who pay their share in taxes when the bill comes due. This Office will not tolerate those who unlawfully seek to game the system in order to evade their tax obligations.”
IRS Deputy Commissioner for Services and Enforcement, John Dalrymple, said: "This action demonstrates that the IRS will pursue those who cheat the tax system no matter how sophisticated or intricate the transactions may be. The vast majority of U.S. taxpayers pay their fair share. We owe it to them to stop tax cheating in whatever form it takes."
According to the allegations contained in the Complaint:
The abusive tax shelter transactions promoted by Levine include “intermediary transactions,” in which the corporate income taxes on the gains received from the sale of corporate assets are illegally avoided for the benefit of shareholders, and “state tax credit transactions,” in which a real estate project owner avoids paying taxes on the gains from the sale of the transferable state tax credits it earns or receives. Levine formed and/or used five corporations – termed “promoter entities” – to carry out these schemes. These promoter entities would acquire the asset-selling corporations and eliminate their capital gains tax using the promoter entities’ phony losses. With respect to the 90 unlawful transactions charged in the complaint, the promoter entities improperly deducted over $515 million in bad debt losses on their tax returns. The government estimates that the tax loss resulting from their promotion of the tax schemes at issue in this case exceeds $129 million, not including penalties and interest, virtually all of which may now be uncollectible due to the lack of assets remaining in the tax-avoiding corporations.
In particular, LEVINE promoted, implemented, and/or participated in over a dozen intermediary transactions, notwithstanding public IRS notices and regulations warning that the IRS considers such transactions “tax avoidance transactions,” and may challenge the tax results of any such transaction and assert penalties on those who promote or participate in them. LEVINE therefore attempted to disguise the true nature of the transactions to avoid IRS enforcement efforts. In addition, LEVINE also promoted, implemented, and/or participated in about 75 abusive state tax credit transactions which, similar to the intermediary transactions, were structured to permit real estate project owners to evade substantial tax liability while allowing LEVINE and others to profit from a portion of the tax savings.
This case is being handled by the Office’s Tax and Bankruptcy Unit. Assistant U.S. Attorneys Alicia M. Simmons and Tara M. La Morte are in charge of the case.
U.S. v. Harold Levine
Luzerne County Man Sentenced to More Than 14 Years in Prison for Drug TraffickingRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a former Kingston resident was sentenced today to serve 175 months in prison by U.S. District Court Judge Robert D. Mariani for distributing heroin and cocaine during a four-year time period.
According to United States Attorney Peter Smith, the defendant, James Featherstone, age 34, previously admitted to distributing cocaine and heroin on multiple occasions in Luzerne County during January 2009 through September of 2013, and possessing a firearm in connection with his drug trafficking.
The charge against Featherstone resulted from an investigation by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), the Pennsylvania State Police, Kingston Police, and the Luzerne County District Attorney’s Office.
Featherstone must also serve three years on supervised release following his prison sentence faces and pay a $100 special assessment.
The case was prosecuted by Assistant U.S. Attorney Francis P. Sempa.
Local Cell Head of A Major Methamphetamine Distribution Conspiracy Is Sentenced to 20 Years in Federal PrisonRead the Press Release
DALLAS — The local cell head of a major methamphetamine distribution conspiracy that operated in the Dallas-Fort Worth metroplex and elsewhere since October 2012, was sentenced this afternoon in federal court in Dallas, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
Gerardo Cisneros, aka “Tatuado,” “Gera,” and “Jerry,” was sentenced by U.S. District Judge Jorge A. Solis to serve a total of 20 years in federal prison. Cisneros, 27, previously agreed to forfeit five vehicles and a firearm.
Cisneros pleaded guilty in October 2013 to one count of conspiracy to possess with intent to distribute and to distribute methamphetamine and one count of conspiracy to commit money laundering. He has been in custody since his arrest in August 2013 when special agents with the Drug Enforcement Administration (DEA) and other law enforcement members executed numerous arrest warrants for defendants charged in the methamphetamine conspiracy as outlined in a federal indictment returned the previous month. The conspiracy involved Cisneros’s mother, who has been arrested, and his sister, who is a fugitive. The methamphetamine was imported into the U.S. from Mexico, and it was delivered to the Dallas area for distribution.
According to documents filed in the case, Cisneros acted as the local cell head of the conspiracy. He worked with co-defendants to set up a receipt and distribution center for controlled substances, including methamphetamine and marijuana. Cisneros admitted that he received and distributed methamphetamine in multi-kilo quantities, collected money from his customers and returned money to his supply source in Mexico. Cisneros admitted sending money to Mexico via couriers to conceal the nature, location, source, ownership or control of the drug proceeds.
Cisneros also admitted conspiring to launder money by depositing drug proceeds into multiple bank accounts so that the money could ultimately be withdrawn by individuals in Mexico in order to conceal or disguise the nature, location, source, ownership or control of the drug proceeds.
Cisneros further admitted he used drug proceeds to purchase a 2006 Chrysler 300, a 2009 Honda Accord, a 2007 Ford Edge, a 2010 Chevrolet Camaro, a 2009 Mercedes and his residence on Marilyn Lane in Arlington. He also admitted that the automobiles, residence and property at this location were used to facilitate drug trafficking.
Twenty-four defendants were charged in the conspiracy. The case against one defendant was dismissed and two defendants are awaiting trial. All other captured defendants have pleaded guilty and are awaiting sentencing.
This Organized Crime and Drug Enforcement Task Force (OCDETF) case was investigated by the DEA, the Dallas Police Department, Grand Prairie Police Department, Garland Police Department, Rockwall Police Department and the Arlington Police Department.
Assistant U.S. Attorney George Leal is leading the prosecution with assistance from Assistant U.S. Attorneys Brian Poe and John DeLaGarza.
Las Cruces Man Sentenced to Seventeen and a Half Years in Federal Prison for Child Porn and Firearms ConvictionsRead the Press Release
ALBUQUERQUE – Juan Lorenzo Barela, Jr., 40, of Las Cruces, N.M., was sentenced today in Las Cruces federal court in two separate criminal cases. Barela was sentenced to 210 months in federal prison followed by five years of supervised release for his conviction on child pornography charges. Barela also was sentenced to 120 months in prison followed by three years of supervised release in a separate case for being a felon in possession of a firearm. The sentences are to be served concurrently. Barela will be required to register as a sex offender after he completes his prison sentence.
Barela was arrested in Oct. 2010 based on two separate criminal complaints. The first complaint charged Barela with distributing, receiving and possessing visual depictions of minors engaged in sexually explicit conduct, and the second charged him with being a felon in possession of firearms and ammunition. Barela has been in federal custody since his arrest.
In Jan. 2011, Barela was indicted in the child pornography case and charged with distributing child pornography in July 2010 and with possessing child pornography in Sept. 2010. Also in Jan. 2011, Barela was indicted and charged with unlawfully possessing firearms and ammunition in Sept. 2010. At the time, Barela was prohibited from possessing firearms and ammunition because he previously had been convicted of residential burglary and larceny in 1997 and of embezzlement in 2003 in the 3rd Judicial District Court for the State of New Mexico.
According to court filings, in July 2010, law enforcement authorities initiated an investigation that revealed that an IP Address subscribed to Barela at his Las Cruces residence was being used to distribute and receive child pornography. On Sept. 14, 2010, Barela was interviewed by law enforcement officers while a search warrant was executed at his residence. During the interview, Barela admitted downloading and possessing child pornography. Forensic examinations of computers and computer-related media seized from Barela’s residence confirmed that they contained child pornography images and videos. During the execution of the search warrant, the officers also seized seven firearms and approximately 1227 rounds of ammunition.
In Aug. 2011, Barela pled guilty to being a felon in possession of firearms and ammunition. Immediately before he was sentenced today, Barela entered a guilty plea to the indictment in the child pornography case.
These two cases were investigated by the Las Cruces office of Homeland Security Investigations, the Las Cruces office of the Bureau of Alcohol, Tobacco, Firearms and Explosives, the New Mexico State Police, the Las Cruces Police Department and the U.S. Marshals Service. The cases were prosecuted by Assistant U.S. Attorney Aaron O. Jordan of the U.S. Attorney’s Las Cruces Branch Office as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice (DOJ) to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and DOJ’s Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
The Operation also was brought as a part of the New Mexico Interstate Crimes Against Children (ICAC) Task Force’s mission, which is to locate, track, and capture Internet child sexual predators and Internet child pornographers in New Mexico. There are 64 federal, state and local law enforcement agencies associated with the ICAC Task Force, which is funded by a grant administered by the New Mexico Attorney General’s Office. Anyone with information relating to suspected child predators and suspected child abuse is encouraged to contact federal or local law enforcement.
Kathy Winters Pleads Guilty to Embezzlement from Alcoa City SchoolsRead the Press Release
KNOXVILLE, Tenn. – On May 19, 2014, a one-count information was filed in U.S. District Court in Knoxville, charging Kathy Ann Winters, 58, of Harriman, Tenn., with wilfully and knowingly embezzling more than $1,000 from the U.S. Department of Education. On June 4, 2014, Winters appeared in U.S. District Court and pleaded guilty to the charges in the information. Sentencing has been set for 1:30 p.m., Oct. 7, 2014.
According to a plea agreement on file with the U.S. District Court, Winters was the federal projects administrative assistant for Alcoa City School District, and treasurer of both the East Tennessee Attendance Supervisors Association (ETASA) and Tennessee Attendance Supervisors Steering Committee (TASSC). While serving in these roles, investigators determined that Winters took funds belonging to the three entities by creating false invoices that demanded payment payable to TASSC or ETASA, forging an approving official’s signature to the false invoices, and forwarding the forged, false invoices to the City of Alcoa for payment. Once the City of Alcoa rendered check payments based on the false invoices, Winters endorsed the checks, and either deposited the funds into her personal account or into the TASSC or ETASA account and then withdrew the money through ATM withdraws and checks made payable to herself.
In addition to the invoice scheme, Winters misused Alcoa City School District credit cards by making unauthorized personal charges on the credit cards and falsified travel reimbursement requests for unauthorized travel. In both instances, Winters forged signatures of approving officials, and submitted the credit card billing statements and travel claims to the City of Alcoa for payment. Winters also caused various bank charges, including overdraft fees, ATM fees, and service charges to be assessed against TASSC and ETASA. The investigation revealed a total loss of $428,076.94, between the three entities. The investigation revealed further that the Alcoa City School District loss included federal government grant money paid to the school district for special education expenses.
On Apr. 4, 2013, during a consensual and voluntary interview, Winters admitted to the fraud and provided a written statement to investigators.
Investigative agencies involved in this investigation include the Tennessee Comptroller’s Office, Financial and Compliance Unit and Tennessee Bureau of Investigation. Assistant United States Attorneys Brooklyn Sawyers and Steve Cook are representing the United States.
James Nathaniel Watts Charged with Killing Two Employees and Critically Injuring One During Attempted Armed Robbery of First National Bank in CairoRead the Press Release
Follow @SDILNewsA Federal Grand Jury sitting in Benton returned an indictment today charging James Nathaniel Watts, 29, of Cairo, Illinois, with Attempted Armed Bank Robbery Resulting in Death announced Stephen R. Wigginton, United States Attorney for the Southern District of Illinois. The indictment alleged that during the commission of his attempted robbery of the First National Bank in Cairo on May 15, 2014, Watts killed two bank employees and critically injured a third. The indictment also charged Watts with being a felon in possession of a firearm.
Watts was previously charged in federal court on Friday, May 16th in a Criminal Complaint with the firearm offense. An affidavit attached to the complaint alleged that Watts illegally possessed a .380 caliber semi-automatic pistol on May 15th and that the firearm was found in his possession following a high-speed chase in Cairo during which Watts was driving the stolen car of one of the employee-victims from the attempted robbery. Watts was denied bond on that charge and remanded to the custody of the United States Marshal to await action by the Grand Jury.
Under the law, a defendant is presumed to be innocent of a charge until proven guilty beyond a reasonable doubt to the satisfaction of a jury.
The indictment returned by the Grand Jury also contains special findings rendering Watts eligible for the death penalty if he is convicted by a jury of the attempted robbery resulting in death offense. Under United States Department of Justice policy, however, the decision on whether or not to seek that penalty will be made at a later date and only after a comprehensive review process designed to ensure nationwide consistency in the application of the federal death penalty. If the death penalty is not sought, a conviction on that count will result in a mandatory sentence of life imprisonment without the possibility of parole.
If convicted of the firearm offense, Watts faces up to an additional 10 years’ imprisonment, a $250,000 fine, and 3 years of supervised release to follow any term of incarceration imposed.
Watts will next appear for arraignment on the indictment at the United States District Courthouse in Benton at a date and time to be set by the Court. He will remain in the custody of the United States Marshal until that time.
The case is being prosecuted by Assistant United States Attorneys James M. Cutchin and George A. Norwood.
Jackson Co. Woman Sentenced to 17.5 Years in Prison on Child Pornography ChargesRead the Press Release
ASHEVILLE, N.C. – A Jackson County woman was sentenced on Tuesday, June 3, 2014, to serve 210 months in a federal prison for producing, receiving, possessing and distributing child pornography, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina. In addition to the prison term, U.S. District Judge Martin Reidinger also ordered Kimberly Rachael Moore, 31, of Tuckasegee, N.C. to serve under court supervision the rest of her life upon release from prison and to register as a sex offender.
Brock D. Nicholson, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in Georgia and the Carolinas and Sheriff Jimmy Ashe of the Jackson County Sheriff’s Office join U.S. Attorney Tompkins in making today’s announcement.
In December 2012, a federal criminal indictment charged Moore with one count of production of child pornography, one count of possession of child pornography, one count of receipt of child pornography and four counts of distribution of child pornography. Moore pleaded guilty to the charges in May 2013. According to court filings and proceedings, during the investigation detectives discovered an extensive collection of child pornography, as well as a computer hard drive, an email account, and online photo sharing accounts.
Moore is in federal custody and will be transferred into custody of the Federal Bureau of Prisons upon designation of a federal facility. Federal sentences are served without the possibility of parole.
The investigation into Moore was handled by HSI and the Jackson County Sheriff’s Office.
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 U.S. 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 http://www.projectsafechildhood.gov.
Indictment: Kansas Firearms Distributor Paid Bribes and Kickbacks to Glock ExecutivesRead the Press Release
TOPEKA, KAN. – A Kansas firearms distributor was indicted today on federal charges of paying more than $1 million in bribes and kickbacks to executives of the company that manufactures Glock pistols, U.S. Attorney Barry Grissom said.
John Sullivan Ralph, III, 40, Olathe, Kan., who was owner of Global Guns & Hunting Inc. of Olathe, Kan., doing business as OMB Guns, is charged with one count of conspiracy, 11 counts of wire fraud and10 counts of money laundering.
The indictment alleges Ralph secretly paid executives of Glock to receive preferential treatment over other distributors of firearms, including directing potential customers to his company, giving his company priority access to limited products, steering government contracts and sales to government agencies of firearms and accessories to his company, and providing confidential Glock information to him.
The following co-defendants are charged with the same counts as Ralph:James “Craig” Dutton, 42, Acworth, Ga., who was the Assistant National Sales Manager for Glock. The American headquarters of Glock, Inc., is in Smyrna, Ga.
Lisa Delaine Dutton, 42, Acworth, Ga., who was Craig Dutton’s wife, and who formed a company called Supreme Solutions LLC. She is alleged to have concealed payments of bribes and kickbacks.
Welcome D. “Bo” Wood, Jr., 65, Oviedo, Fla., who was the Eastern Regional Manager for Glock.
Paula Ann Wood, 63, Oviedo, Fla, who was Bo Wood’s wife, and who formed a company called Tropical Marketing & Consulting LLC. She is alleged to have concealed payments of bribes and kickbacks.According to the indictment, most of Glock’s pistols are sold to independent firearm distributors who have contracts with Glock to resell its pistols. The allocation of Glock pistols was important because the demand frequently exceeded the supply.
Glock created two different sales channels for purposes of licensing its distributors. One channel was for sales to law enforcement agencies. Independent distributors were authorized to resell Glock pistols to law enforcement agencies within a specific geographic territory. The other channel was for the commercial market. Distributors of commercial market products were not restricted to a particular geographic area.
Glock used a Universal Product Code to differentiate pistols that were sold for resale to law enforcement agencies (blue label products) from pistols sold for resale to the commercial market (red label products). The price list for pistols intended for resale to law enforcement agencies is lower due to the fact law enforcement agencies routinely buy in bulk and are often subject to bidding processes.
The indictment alleges Wood and Dutton provided Ralph with equipment and software to allow him to convert firearms sold with the law enforcement discount (blue label) to firearms sold at the premium price to the commercial market (red label). Ralph is alleged to have sold at least 14,000 pistols to commercial buyers – including Cabela’s – which Glock sold to Ralph for resale to law enforcement agencies.
The indictment alleges that from 2003 to 2009 Ralph used the U.S. Postal Service to send and receive approximately 140 bribes and kickbacks that were delivered to defendants Lisa Dutton and Paula Wood. Between 2009 and 2011, the indictment alleges, Ralph used wire transfers to send approximately 80 bribes and kickbacks.
Upon conviction, the crimes carry the following penalties:
Conspiracy: A maximum penalty of 30 years in federal prison and a fine up to $1 million.
Wire fraud: A maximum penalty of 30 years in federal prison and a fine up to $1 million on each count.
Money laundering: A maximum penalty of 20 years and a fine up to $50,000 on each count.The FBI investigated. Assistant U.S. Attorney Richard Hathaway is prosecuting.
OTHER INDICTMENTS
Yong Jin Zhang, 55, who is in federal custody, and Yu Lan Su, 50, who is in federal custody, are charged with one count of transporting a person in interstate commerce for the purpose of prostitution, and one count of harboring a person for the purpose of prostitution at Life Long Foot Massage, also known as Asian Foot Relax Massage, at 5620 S. W. 29th Street; and 2955 S.W. McClure Road, No. 310, in Topeka, Kan. The crimes are alleged to have occurred from March 14 to May 21, 2014, in Topeka, Kan.
The defendants initially were charged in a criminal complaint filed May 22, 2014, in U.S. District Court in Topeka.
If convicted, they face a maximum penalty of 10 years in federal prison and a fine up to $250,000 on each count. Homeland Security Investigations investigated. Assistant U.S. Attorney Randy Hendershot is prosecuting.
Christopher B. Medlock, 28, who is in custody, is charged with one count of escaping from the Mirror Residential Reentry Center in Topeka, Kan. The crime is alleged to have occurred May 6, 2014.
If convicted, he faces a maximum penalty of five years in federal prison and a fine up to $250,000. The U.S. Marshals Service investigated. Assistant U.S. Attorney Randy Hendershot is prosecuting.
Juan O. Whitaker, 32, who is in custody, is charged with one count of unlawful possession of a firearm after a felony conviction, and one count of unlawful possession of a sawed off shotgun. The crimes are alleged to have occurred May 1, 2014, in Saline County, Kan.
If convicted, he faces a maximum penalty of 10 years in federal prison and a fine up to $250,000 on each count. The Salina Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Randy Hendershot is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
ICON Telecom, Its Owner, and A Former Associate Charged in $25 Million Fraud in Federal Wireless Telephone Subsidy ProgramRead the Press Release
Oklahoma City, Oklahoma – WESLEY YUI CHEW, of Edmond, Oklahoma, his company, ICON TELECOM, INC., also of Edmond, and OSCAR ENRIQUE PEREZ-ZUMAETA, of Cancun, Mexico, have been charged with crimes involving more than $25 million of fraudulent claims against the federal Lifeline telephone program, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma, and David L. Hunt, Inspector General of the Federal Communications Commission ("FCC").
Background
The current Lifeline Program, which was created in 1985, furthers the FCC’s mission to provide all Americans with access to a basic level of telephone service. Since 2005, Lifeline has provided subsidies to participating telephone companies not only for landline service, but also for wireless service for qualifying low-income customers. The Universal Service Administrative Company ("USAC") administers the Lifeline Program on behalf of the FCC and under detailed federal regulations. To pay for the program, USAC collects fees from telephone companies, which often pass the fees on to customers as "universal service charges" on monthly telephone bills.
Most participating wireless telephone companies receive a subsidy of $9.25 per month for each qualifying low-income customer. If a qualifying customer lives on "Tribal Lands," however, the company receives $34.25 for each qualifying customer. Much of Oklahoma includes Tribal Lands that qualify for the higher monthly subsidy.
Participating telephone companies file forms with the FCC, prior to receiving reimbursement, that report the number of Lifeline eligible subscribers that have been served by the companies. Companies must also file annual reports by January 31 to certify that customers who received Lifeline service at an earlier date remain eligible for the program.
Icon Telecom, owned exclusively by Chew, participated in the wireless Lifeline Program from July 2011 until September 2013. It is alleged that in September 2011, Icon reported fewer than 2,200 wireless customers who qualified for the Lifeline program. By November 2012, that number had grown to 135,364. It is alleged that Icon always claimed subsidies at the "Tribal Lands" rate of $34.25 per customer per month. Although it had fewer than ten full-time employees, it is alleged that Icon received a total of $58,283,329 through the Lifeline Program during 2011, 2012, and 2013.
It is further alleged that to recruit new customers, Icon relied almost exclusively on PSPS Sales LLC, which Perez-Zumaeta owned and operated. Icon paid PSPS Sales from $7.00 to $15.00 for each new customer. From December 2011 through April 2013, Icon paid more than $1,040,000 to PSPS Sales.
Information Charging Chew and Icon Telecom
Chew has been charged with money laundering for his transfer of $20,455,829.10 on April 9, 2013, from an Icon account to a personal account. If convicted, Chew faces up to 10 years in prison and a fine of $250,000 or twice the amount of the criminally derived property involved in the transfer, whichever is greater.
Icon is charged with making a false statement to USAC. Specifically, it is alleged that USAC auditors asked Icon on May 6, 2013, to provide 58 specific customer recertification forms as part of a Lifeline audit. It is alleged that in the absence of legitimate forms, Icon created false recertification forms, fabricated the subscribers’ signatures on the forms, and electronically submitted the fictitious forms to USAC in response to the audit. If convicted, Icon faces up to five years of probation, a fine of up to $500,000, and mandatory restitution.
The information also seeks forfeiture of the $20,455,829.10 involved in the money-laundering transaction.
Indictment Charging Perez-Zumaeta
Perez-Zumaeta has been charged in a ten-count indictment. Count One alleges that Perez-Zumaeta conspired with Chew and Icon to defraud USAC and the FCC of more than $25 million. Counts 2 - 6 allege wire fraud. Three of these counts relate to payments from USAC to Icon of over $7 million each. Counts 7 - 10 charge money laundering based on deposits of criminal proceeds into a PSPS Sales bank account.
In general, the indictment alleges that Perez-Zumaeta directed PSPS Sales personnel to use phone books to come up with names and addresses for bogus Lifeline customers and to dispose of telephones registered to fake customers by selling them on the street for approximately $5 each. Perez-Zumaeta is also alleged to have instructed PSPS Sales personnel to fabricate signatures of fictitious customers on approximately 40,000 recertification forms and to cover up the fabrications by using different pens, different hand-writing styles, and different formats for dates.
If convicted, Perez-Zumaeta could be imprisoned for 20 years on each of the conspiracy and wire-fraud counts and 10 years on each of the money-laundering counts. He would also be subject to a fine of up to $250,000 on each count, and mandatory restitution. Furthermore, the indictment seeks forfeiture of all proceeds of the alleged fraud and all property involved in the money-laundering transactions.
Perez-Zumaeta was arrested on April 25, 2014, at the San Francisco airport and is currently in federal custody. On May 16, he was ordered detained pending further proceedings after the Court found he presented a risk of flight.
Investigative Agencies
"Although this program was designed to help low-income Americans have basic access to phone service, these individuals, and their companies, allegedly exploited the system to line their own pockets," said U.S. Attorney Coats. "All of us must be concerned when programs like this are abused and defrauded. I commend the FCC-Inspector General, FBI, and IRS Criminal Investigation for their cooperation and coordination in this investigation."
Said FCC Chairman Tom Wheeler, "The FCC’s adoption of tough, enforceable rules in 2012 to combat waste, fraud and abuse in Lifeline is paying off. Lifeline provides a link to jobs, family and emergency services for Americans who cannot afford phone service. I thank the Office of the Inspector General and our partners in the U.S. Attorney’s Office, IRS, and FBI for fighting fraud so that Lifeline can continue to help low-income Americans afford the basic phone service that most consumers take for granted."
This case is the result of an investigation by the Office of Inspector General for the Federal Communications Commission, the Federal Bureau of Investigation, and IRS Criminal Investigation. The cases are being prosecuted by Assistant U.S. Attorneys Chris M. Stephens and Scott E. Williams.
The public is reminded that these charges are merely accusations and that the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt. Reference is made to the information, the indictment, and other public filings for further information.
Houston Man Sentenced for Drug Trafficking Conviction in Liberty CountyRead the Press Release
Department of Justice
Office of Public AffairsBEAUMONT, Texas – A 51-year-old Houston man has been sentenced to federal prison for drug trafficking violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Tomas Alonso Moreno pleaded guilty on Jan. 14, 2014 to possession with intent to distribute cocaine and was sentenced to 30 months in federal prison today by U.S. District Judge Ron Clark.
According to information presented in court, on Oct. 22, 2013, Moreno was stopped in Liberty County, Texas for a defective brake light. Moreno appeared nervous and was driving while his license was suspended. He consented to a search of the vehicle after denying that he was carrying anything illegal. As officers prepared to search the vehicle, Moreno confessed to having cocaine in the center console. Officers located the cocaine and arrested Moreno. A federal grand jury returned an indictment on Nov. 6, 2013, charging Moreno with drug trafficking violations.
This case is the result of an Organized Crime Drug Enforcement Task Force (OCDETF) joint investigation. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
This case was investigated by the Liberty County Sheriff’s Office and prosecuted by Assistant U.S. Attorney Robert L. Rawls.
#######Guilty Plea to A Conspiracy to Bribe A U.S. Air Force Contract AdministratorRead the Press Release
SACRAMENTO, Calif. — Lida Amin, 40, of Dubai, United Arab Emirates, and Dublin, Calif., pleaded guilty today to conspiring to bribe a public official in furtherance of an ongoing effort to secure government contracts through graft, United States Attorney Benjamin B. Wagner announced.
On August 8, 2013, a federal grand jury charged Lida Amin and her brother Nabil Amin with conspiring to bribe a public official in exchange for a military contract to supply medical clothing and linens that were to be shipped to Afghanistan via Travis Air Force Base. Lida Amin was also charged with three counts of using interstate commerce facilities to aid in her bribery activities: one of those counts is for transportation of goods on Interstate 80 and two of the counts are for using Internet-based email to communicate with officials at Travis Air Force Base.
According to the plea agreement, from 2007 to 2010, Lida Amin engaged in a related scheme for which she is facing federal charges in Texas. In that scheme she conspired to bribe a member of the U.S. Air Force who was serving in Afghanistan as a contracting officer. He awarded contracts to the conspirators in exchange for the promise of $30,000. In 2008, the contracting officer was paid $18,000, but the remaining $12,000 was still owed.
The charges to which Amin pleaded guilty today relate to a second round of contacts with the same contracting officer. In June 2012, he was working for the U.S. government as a civilian acquisition analyst (or contract administrator) in Afghanistan and contacted Lida Amin to see if she was interested in working with government contracts again. Lida Amin replied that she was and agreed to meet in Budapest, Hungary to talk. The scheme involved the contract administrator assisting Lida Amin to obtain as many new government contracts as possible. In exchange, she promised to make bribe payments to the contract administrator.
In September 2012, Lida Amin met with the contract administrator in Budapest. They discussed two upcoming contracts, the manner and amount of the bribe, and in addition to that amount, Lida Amin would pay him an extra $12,000 to cover the debt that he was owed from 2008. Lida Amin and the contract administrator arranged a means to communicate covertly about the government contract bidding process.
Lida Amin established companies and bank accounts in Afghanistan to receive the proceeds from government contracts. In July 2013, Lida Amin, using the alias “Sabrina Samir” and acting through one of her companies, Striker Logistics, shipped contract goods, including medical clothing and linens, to Travis Air Force Base.
On August 28, 2013, Lida Amin was arrested in Prague after she traveled there to meet with the contract administrator.
This case is the product of an investigation by the U.S. Federal Bureau of Investigation, the U.S. Drug Enforcement Administration, and the Fremont Police Department. Assistance was provided by the U.S. Department of Justice, Office of International Affairs and the Czech National Police. Assistant United States Attorney Michael M. Beckwith is prosecuting this case and the case in Texas.
Nabil Amin is scheduled for a status conference in Sacramento on July 9, 2014. The charge against him is only an allegation; he is presumed innocent until and unless proven guilty beyond a reasonable doubt. On June 17, 2014, Lida Amin is scheduled to plead guilty to the charges brought in the Northern District of Texas for the earlier bribery scheme. That hearing will be held in the federal courthouse in Dallas.
Amin is scheduled to be sentenced by United States District Kimberly J. Mueller on September 3, 2014. The plea agreement under which she entered her plea is subject to the approval of Judge Mueller. If the agreement is accepted, Amin’s actual sentence will be determined at the discretion of the court after consideration of any applicable statutory sentencing factors and the Federal Sentencing Guidelines, which take into account a number of variables.
The public is encouraged to report instances of public corruption and government fraud to the FBI by calling toll free 855-4NO-PCGF (855-466-7243).
Guilty Plea Entered in Department of Labor Fraud CaseRead the Press Release
KNOXVILLE, Tenn. – On June 4, 2014, Ronald T. Wolfenbarger, 46, of Knoxville, Tenn., pleaded guilty to a one-count information charging him with theft of government funds. Sentencing for is set for 10:00 a.m. Oct. 6, 2014. He faces up to 10 years in prison, a fine of $250,000, and up to three years of supervised release upon their release from prison.
According to the plea agreement on file with the U.S. District Court, Eastern District of Tennessee, Wolfenbarger received unemployment benefits from the State of Tennessee unemployment program. These unemployment benefits were supplemented with federal funds through the American Recovery and Reinvestment Act of 2009, which authorized 100 percent federal funding for unemployment benefits that he qualified for and received. An internal audit determined that he was overpaid unemployment benefits after failing to report employment and earnings from his employer, violating the policies and procedures for receiving unemployment benefits. In his plea agreement, Wolfenbarger admitted to obtaining unemployment insurance benefits to which he was unentitled.
Unemployment benefits are designed to assist those who qualify under specific policies and procedures. Unemployment benefits fraud is a serious offense. Individuals who take advantage of this benefit program through theft, fraud, and lies, effectuated by hiding earnings, may be prosecuted and face both terms in prison and fines.
This charge and subsequent guilty plea are the result of an investigation by DOL-Office of Inspector General and Tennessee Department of Labor. Assistant U.S. Attorney Brooklyn Sawyers represents the United States.
Members of the public are reminded that an information constitutes only charges and that every person is presumed innocent until his or her guilt has been proven beyond a reasonable doubt.
Grand Jury Indicts Two Scientists for Obtaining Government Research Contracts by FraudRead the Press Release
Tampa, Florida – United States Attorney A. Lee Bentley, III announces the unsealing of an indictment charging Mahmoud Aldissi, a/k/a “Matt,”(62) and Anastassia Bogomolova, a/k/a “Anastasia,” (51), both of Pinellas County, Florida, with conspiracy to commit wire fraud, wire fraud, aggravated identity theft, and falsification of records in a federal investigation. If convicted on all counts, each faces a maximum penalty of 20 years in federal prison. The Indictment also notifies the individuals that, among other specified property, the United States is also seeking a money judgment in the amount of $10,000,000, which reflects the proceeds of the charged criminal conduct.
According to the indictment, through their two companies, Fractal Systems, Inc., and Smart Polymers Research Corp., Aldissi and Bogomolova fraudulently obtained approximately $10,000,000 worth of research contracts from the federal government. It is alleged that from in or about 2004 through in or about May 2014, in order to be awarded contracts, the charged individuals submitted proposals using the stolen identities of real people in order to create false endorsements of and for their proposed contracts. In addition, Aldissi and Bogmolova proposed identity theft victims as consultants and subcontractors without their knowledge and without actually using them on those contracts. It is further alleged that, in the proposals, the defendants also lied about their facilities, costs, about the principal investigator on some of the contracts, and certifications in the proposal.
An indictment is merely a formal charge that a defendant has committed a violation of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by Defense Criminal Investigative Service (DCIS), National Aeronautics and Space Administration’s Office of the Inspector General (NASA-OIG), the Major Procurement Fraud Unit (MPFU) of the United States Army Criminal Investigation Division (Army CID), National Science Foundation’s Office of the Inspector General (NSF-OIG), the Environmental Protection Agency’s Office of the Inspector General (EPA-OIG), the Department of Energy’s Office of the Inspector General (DOE-OIG), the Department of Health and Human Services’ Office of the Inspector General (HHS-OIG), the Department of Homeland Security’s Office of the Inspector General (DHS-OIG), the Department of Homeland Security (DHS), and the U.S. Marshals Service (USMS). It will be prosecuted by Assistant United States Attorney Thomas N. Palermo.
Fridley Man Sentenced for Transporting A Minor to Engage in ProstitutionRead the Press Release
MINNEAPOLIS— Earlier this week in federal court, a 28-year-old man was sentenced for transporting a minor to engage in prostitution. On June 2, 2014, United States District Court Judge Richard H. Kyle sentenced Napoleon Long, Jr. to 180 months in federal prison on one count of Transportation With Intent to Engage in Prostitution. Long was indicted on April 10, 2013 and pleaded guilty on July 11, 2013.
In his plea agreement, Long admitted that in or about October 2011, he transported a 17- year-old girl from Minnesota to Colorado Springs, Colorado, with the intent that she engage in prostitution. Long also admitted knowing the girl was 17, and that she engaged in at least one sexual act while in Colorado and a pattern of sexual activity while working as a prostitute for him.
United States Attorney Andrew M. Luger stated that his Office was pleased with the sentence in this case. “Those such as this defendant, who profit by using underage girls in commercial sexual activity, will be prosecuted aggressively by this Office.”
This case was the result of an investigation by the Anoka County Sheriff’s Office and the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. It was prosecuted by Assistant U.S. Attorneys David P. Steinkamp and Manda M. Sertich.
In 2012, Yuri Fedotov, the head of the United Nations’ Office on Drugs and Crime reported to those attending a U.N. General Assembly meeting that an estimated 2.4 million people worldwide are victims of human trafficking at any one time, with 80 percent of them being exploited as sex slaves. He also said approximately $32 billion is earned collectively every year by the criminals who operate human trafficking networks. The U.S. Department of Justice reports that an estimated 14,500 to 17,500 people are trafficked within the U.S. alone each year.
For more information, visit http://www.ice.gov/human-trafficking/Former Veterans Affairs Doctor Pleads Guilty to Illegally Prescribing OxycodoneRead the Press Release
CONTACT: Fred Alverson
Public Affairs Officer
DAYTON, OHIO – Julia Immaculata Lucente, 55 of Dayton pleaded guilty in U.S. District Court to illegally prescribing oxycodone while she was a physician at the Veterans Affairs medical center in Dayton.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, Gavin McClaren, Resident Agent in Charge, Department of Veterans Affairs Office of Inspector General Criminal Investigations Division (VA-OIG), Timothy Plancon, Assistant Special Agent in Charge, Drug Enforcement Administration (DEA), and Jonathan Blanton, Interim Director, State Medical Board of Ohio announced the plea entered today before U.S. Magistrate Judge Michael J. Newman.
According to court documents, Lucente began her employment as a medical doctor at the Veterans Administration Medical Center (VAMC) in Dayton in 2008. On November 6, 2012, Lucente used her VAMC prescription pad to issue issued a prescription for 72 Oxycodone pills to an individual who was neither a patient of Lucente’s nor a patient at the VAMC. Further, Lucente wrote the prescription without a documented proper medical examination, which is contrary to established medical protocol.
Lucente pleaded guilty to one misdemeanor count of aiding and abetting another to knowingly and intentionally possess a controlled substance.
“Terms of the plea agreement call for Lucente to permanently surrender her Medical and DEA licenses,” U.S. Attorney Stewart said. “She also agreed not to reapply for a medical or DEA license in Ohio or any other state.”
Lucente will serve a period of probation to be determined by the court after the court conducts a pre-sentence investigation. No date has been set for sentencing.
“We will tirelessly pursue any VA employees violating their position of trust.” said Gavin McClaren, United States Department of Veterans Affairs – Office of Inspector General, Resident Agent in Charge, Cleveland.
“Coordination between agencies is important in these types of complex investigations, DEA Assistant Special Agent in Charge Plancon said. “The DEA values the partnerships we have with Federal, State, and Local agencies in our common goal to combat prescription drug abuse.”
“Criminal prescribers have no place in the medical profession,” SMBO Interim Director Blanton said. Partnerships like this one, where we had the opportunity to work with the outstanding agents out in the field, are an invaluable tool in the Medical Board’s continuing efforts to make sure the physicians Ohioans trust with their health care are ethical, competent, and follow the law.”
U.S. Attorney Stewart commended the cooperative investigation by the VA OIG, the DEA Tactical Diversion Squad, and the State Medical Board of Ohio, as well as Assistant U.S. Attorney Sheila Lafferty, who is prosecuting the case.
# # #Former Orleans Parish Sheriff's Office Vendor and Mississippi Businessman, Kendall O. Marquar, Convicted of Failing to File TaxesRead the Press Release
KENDALL O. MARQUAR, age 36, a resident of Waveland, Mississippi, pled guilty today before U.S. Magistrate Judge Sally Shushan to the one-count Bill of Information charging him with willfully failing to file taxes, announced U.S. Attorney Kenneth Allen Polite, Jr.
According to court documents, from in or around 2000 through in or around 2012, MARQUAR, was a Mississippi businessman and owner of K&D Earthworks, a maintenance and construction vendor at the Orleans Parish Sheriff’s Office (“OPSO”). During the years 2007, 2008, and 2009, MARQUAR and K&D Earthworks earned approximately $580,379 in taxable income, mainly from work performed at the OPSO. As set forth in the factual basis, MARQUAR failed to file taxes during the years 2007 through 2009. As a result, MARQUAR owes the Internal Revenue Service approximately $156,941 in funds based on the unpaid taxes. As part of his plea agreement, MARQUAR has agreed to repay this amount to the Internal Revenue Service.
MARQUAR faces a maximum term of imprisonment of one year, a fine of $100,000, and up to one year supervised release following any term of imprisonment. His sentencing is scheduled for September 9, 2014.
The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service – Criminal Investigative Division. The case is being prosecuted by Assistant U. S. Attorney Matt Chester.
(Download Factual Basis )
Former Laredo Customs Broker Sentenced for False Classification of Imported GoodsRead the Press Release
LAREDO, Texas - Alejandro Santos, 34, a former U.S. Customs broker, has been ordered to prison following his convictions related to the smuggling of goods into the country, announced U.S. Attorney Kenneth Magidson along with Special Agent in Charge Janice Ayala, of Homeland Security Investigations (HSI) in San Antonio. Santos pleaded guilty May 14, 2013, before U.S. Magistrate Judge J. Scott Hacker.
Today, U.S. District Judge George P. Kazen, who later accepted the guilty plea, handed Santos a total sentence of 28 months in federal prison for his three convictions of entry of goods by false classification, smuggling goods into the U.S. and making a false statement to an HSI agent. He was further ordered to pay nearly $140,000 in restitution and will serve three years of supervised release following completion of the prison term.
“As illustrated by this probe, HSI and U.S.Customs and Border Protection import specialists are cracking down on customs fraud, which often involves a substantial loss of revenue for law abiding companies and the government,” said Ayala. “Our focus on trade violations and related criminal activities is crucial to maintaining the integrity of a vital commercial trade.”
Santos was licensed by Customs and Border Protection (CBP) to file entry documents for commercial shipments on behalf of importers. As a result of his conviction, Santos was required to surrender his broker’s license. His responsibilities included generating entry packages, describing, classifying and valuating shipments for importation into the U.S. and submitting appropriate payments to CBP on behalf of his clients for any duties, taxes and fees owed, if any.
Santos used a scheme to defraud the government by falsifying the country of origin on goods imported into the United States. The falsification allowed him to benefit from the North American Free Trade Agreement preferential treatment program, resulting in zero duties and taxes owed. In truth, duties and taxes should have been paid to the U.S. Santos would then collect money from his clients to cover the correct amount of duties and taxes that should have been paid to CBP. Santos then failed to turn over the money to CBP, keeping the monies for himself.
Santos admitted to importing various goods into the U.S. made in India and Italy, while falsely claiming the goods were made in Mexico. He would then collect money from his clients (importers of record) and keep the money.
Santos was permitted to remain on bond but is required to surrender no later than June 9, 2014, to begin his sentence with a U.S. Bureau of Prisons facility to be determined in the near future.
The case was investigated by HSI. Assistant U.S. Attorney (AUSA) Roberto Ramirez and former AUSA Roel Canales prosecuted the case. AUSA Homero Ramirez handled the sentencing today.
Former KC Man Pleads Guilty to Producing Child PornRead the Press Release
Project Safe Childhood
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a former Kansas City, Mo., resident pleaded guilty in federal court today to charges related to producing child pornography.
Paul Leslie Kannarr, 59, formerly of Kansas City, pleaded guilty before U.S. District Judge Dean Whipple to all 10 counts of a May 21, 2013, federal indictment.
By pleading guilty today, Kannarr admitted that he used a minor, identified as “Jane Doe,” to produce child pornography on six separate occasions between Dec. 19, 1999 and Sept. 23, 2000.
Kannarr also pleaded guilty to two counts of posting a notice online that offers to display or distribute child pornography, one count of transporting child pornography over the Internet and one count of possessing child pornography.
Under federal statutes, Kannarr is subject to a mandatory minimum sentence of 10 years in federal prison without parole on each of the six production counts and the two advertising counts, up to a sentence of 180 years in federal prison without parole. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Katharine Fincham. It was investigated by the Kansas City, Mo., Police Department and the FBI Cyber Crimes Task Force.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."Former Fugitive Member of A Pickpocket Crew Sentenced to More Prison Time for Failing to Surrender to Serve Her SentenceRead the Press Release
Destroyed Electronic Monitoring Equipment When She Fled
Baltimore, Maryland – U.S. District Judge Marvin J. Garbis sentenced Crystal Barner, age 28, of Baltimore, today to 14 months in prison for failing to report to serve her sentence in a previous case. Judge Garbis ordered that today’s sentence be served consecutive to Barner’s 33 month sentence in that case.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; U.S. Marshal Johnny Hughes; Special Agent in Charge Brian Murphy of the United States Secret Service – Baltimore Field Office; Colonel Michael Kundrat, Chief of the Maryland Transportation Authority Police; Chief James W. Johnson of the Baltimore County Police Department; and Commissioner Anthony W. Batts of the Baltimore Police Department.
According to the facts presented at her plea hearing, on December 5, 2013, Barner was sentenced to 33 months incarceration (after credit for time served) and ordered to surrender to serve her sentence on January 6, 2014. This was memorialized in a Judgment entered on December 9, 2013, which stated that Barner should report to the institution designated by the Bureau of Prisons at the date and time specified in a written notice that would be sent to her. If she did not receive such a written notice, Barner was ordered to surrender to the United States Marshal before 2 p.m. on Monday, January 6, 2014.After the sentencing hearing, Barner was required to go to the Marshals Service to verify her residence. Barner falsely verified her address, although she had moved from that address several months earlier. As a result, Barner did not receive the written notice of where she was supposed to self-surrender to the Bureau of Prisons, nor did she comply with the Court’s Judgment by surrendering to the United States Marshall before 2 p.m. on Monday, January 6, 2014.
When she failed to surrender, Barner was contacted by her Pre-trial Services officer, and told him she would self-surrender. During a subsequent telephone conversation, she told him she was in the area looking for parking. In fact, Barner had absconded from supervision and removed and discarded or destroyed her electronic monitoring equipment.
Barner was previously convicted for her role in a scheme to defraud financial institutions by stealing credit cards from the wallets and purses of unsuspecting individuals, then using the stolen credit cards to make purchases. During the course of the conspiracy, Barner and others obtained goods, services and extensions of credit in the amount of $142,717.61, and caused losses to or used the identities of between 10 and 50 financial institutions, businesses and individuals.
United States Attorney Rod J. Rosenstein thanked the U.S. Marshal Service, who apprehended Barner after she fled. Mr. Rosenstein also recognized the U.S. Secret Service, Maryland Transportation Authority Police, Baltimore County Police Department, Baltimore City Police Department, and Atlantic City, New Jersey Police Department for their work in the previous investigation. Mr. Rosenstein praised Assistant U.S. Attorney Tamera L. Fine, who prosecuted the case.
Former Chief Financial Officer Pleads Guilty in White Plains Federal Court to Embezzling $5.7 Million and Evading Income TaxesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today that GREGG PIERLEONI pleaded guilty to fraud and tax evasion charges arising from his embezzlement of more than $5.7 million from his employer. PIERLEONI pleaded guilty to one count of mail fraud and one count of tax evasion today in White Plains federal court before U.S. District Judge Vincent L. Briccetti, who set a sentencing date for September 18, 2014.
U.S. Attorney Preet Bharara stated: “Gregg Pierleoni indulged in an opulent lifestyle, at the expense of his employer and the American taxpayer. With his guilty plea today, he will now have to pay for that decision.”
According to the allegations in court documents filed in White Plains federal court:
PIERLEONI was the Chief Financial Officer (“CFO”) of a privately held moving and storage company that maintained its headquarters in Westchester County. As CFO, Pierleoni was authorized to write checks drawn on, and transfer funds from, bank accounts held by the moving company and a related entity. From about October 2006 to about April 2013, PIERLEONI paid more than $5.7 million in personal expenses with the moving company's funds. These personal expenses included collectible items, sports memorabilia, airline tickets and other travel expenses, artwork, tickets to sporting events, and meals in restaurants.
PIERLEONI also failed to report the $5.7 million he embezzled from the moving company as income on his personal tax returns for 2007 through 2011 and failed to file a U.S. Individual Income Tax Return Form 1040 for 2012. The resulting loss to the Internal Revenue Service was more than $1.4 million.
PIERLEONI, 59, of New Fairfield, CT, faces sentences of 25 years’ imprisonment on the mail fraud and wire fraud counts. The maximum statutory sentences are prescribed by Congress and provided here for informational purposes, as any sentencing of the defendant would be determined by the judge.
Mr. Bharara praised the investigative work of the Federal Bureau of Investigation and the Internal Revenue Service - Criminal Investigation.
This case is being handled by the Office’s White Plains Division. Assistant U.S. Attorney James McMahon is in charge of the criminal prosecution.
U.S. v. Gregg Pierleoni Superseding Information
Former Army National Guard Soldier Pleads Guilty to Bribery and Defrauding the U.S. Army National Guard BureauRead the Press Release
A former soldier in the U.S. Army National Guard pleaded guilty to bribery and fraud on the U.S. Army National Guard Bureau, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Kenneth Magidson of the Southern District of Texas.
Former Specialist Christopher Renfro, 26, of Houston, Texas pleaded guilty today to two counts of wire fraud and one count of aggravated identity theft. Previously, on March 24, 2014, Renfro pleaded guilty to one count of conspiracy and one count of bribery in connection with the same scheme.
According to court documents, former and current military recruiters and U.S. soldiers in the San Antonio and Houston areas engaged in a wide-ranging corruption scheme to obtain fraudulent recruiting bonuses. To date, the investigation has led to charges against 25 individuals, 23 of whom have pleaded guilty.
According to court documents, in approximately September 2005, the National Guard Bureau entered into a contract with Document and Packaging Broker Inc. (Docupak) to administer the Guard Recruiting Assistance Program (G-RAP). The G-RAP was a recruiting program that offered monetary incentives to soldiers of the Army National Guard who referred others to join the Army National Guard. Through this program, a participating soldier could receive up to $2,000 in bonus payments for referring another individual to join the Army National Guard. Based on certain milestones achieved by the referred soldier, a participating soldier would receive payment through direct deposit into the participating soldier’s designated bank account. To participate in the program, soldiers were required to create online recruiting assistant accounts.
Renfro admitted that between approximately February 2008 and August 2011, he paid former Sergeant First Class Michael Rambaran for the personal identifying information of potential Army National Guard soldiers. Renfro further admitted that he used the personal information for these potential soldiers to obtain fraudulent bonuses by falsely claiming that he was responsible for referring these soldiers to join the Army National Guard.
Renfro is scheduled to be sentenced on Jan. 9, 2015 before U.S. District Judge Lee H. Rosenthal of the Southern District of Texas.
Rambaran pleaded guilty on March 25, 2014 to one count of conspiracy, one count of bribery, and one count of aggravated identity theft. He is scheduled to be sentenced on Jan. 9, 2015 before U.S. District Judge Rosenthal in Houston.
This case is being investigated by the San Antonio Fraud Resident Agency of Army CID’s Major Procurement Fraud Unit. This case is being prosecuted by Trial Attorneys Sean F. Mulryne, Heidi Boutros Gesch, and Mark J. Cipolletti of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney John Pearson of the Southern District of Texas.Former Army National Guard Soldier Pleads Guilty to Bribery and Defrauding U.S. Army National Guard BureauRead the Press Release
To Date, 23 Individuals Have Pleaded Guilty in Ongoing Corruption Investigation
WASHINGTON – A former soldier in the U.S. Army National Guard pleaded guilty to bribery and fraud on the U.S. Army National Guard Bureau, announced U.S. Attorney Kenneth Magidson and Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division. .
Former Specialist Christopher Renfro, 26, of Houston, pleaded guilty today to two counts of wire fraud and one count of aggravated identity theft. Previously, on March 24, 2014, Renfro pleaded guilty to one count of conspiracy and one count of bribery in connection with the same scheme.
According to court documents, former and current military recruiters and U.S. soldiers in the San Antonio and Houston areas engaged in a wide-ranging corruption scheme to obtain fraudulent recruiting bonuses. To date, the investigation has led to charges against 25 individuals, 23 of whom have pleaded guilty.
According to court documents, in approximately September 2005, the National Guard Bureau entered into a contract with Document and Packaging Broker Inc. (Docupak) to administer the Guard Recruiting Assistance Program (G-RAP). The G-RAP was a recruiting program that offered monetary incentives to soldiers of the Army National Guard who referred others to join the Army National Guard. Through this program, a participating soldier could receive up to $2,000 in bonus payments for referring another individual to join the Army National Guard. Based on certain milestones achieved by the referred soldier, a participating soldier would receive payment through direct deposit into the participating soldier’s designated bank account. To participate in the program, soldiers were required to create online recruiting assistant accounts.
Renfro admitted that between approximately February 2008 and August 2011, he paid former Sergeant First Class Michael Rambaran for the personal identifying information of potential Army National Guard soldiers. Renfro further admitted he used the personal information for these potential soldiers to obtain fraudulent bonuses by falsely claiming he was responsible for referring these soldiers to join the Army National Guard.
With Renfro’s plea, five individuals have now been convicted in connection with this particular charge, including Rambaran, who also pleaded guilty to one count of aggravated identity theft. Renfro, Rambaran and the others will all be sentenced Jan. 9, 2015, before U.S. District Judge Lee H. Rosenthal in Houston.
The cases are being investigated by the San Antonio Fraud Resident Agency of U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit. This case is being prosecuted by Assistant U.S. Attorney John Pearson and Trial Attorneys Sean F. Mulryne, Heidi Boutros Gesch and Mark J. Cipolletti of the Criminal Division’s Public Integrity Section.
Food Stamp Fraud Charges Announced Against Cincinnati Market OwnerRead the Press Release
CONTACT: Fred Alverson
Public Affairs Officer
DAYTON, OHIO– A federal grand jury has indicted Moustaphe Toure, 54, of Cincinnati, charging him with illegally exchanging “food stamp” cards for cash and other ineligible items including a firearm.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, Derrick Hurst, Acting Special Agent in Charge, U.S. Department of Agriculture, Office of Inspector General (USDA), Mark Porter, Special Agent in Charge, U.S. Secret Service, and John Born, Director, Ohio Department of Public Safety announced the indictment today after Toure was arraigned in U.S. District Court. The indictment was returned on May 27, 2014.
According to the indictment, Toure owned and operated a retail store known as Quick Stop Convenience Store and Sarah Carryout. The indictment charges him with 20 counts of unauthorized use and possession of federal food stamp access devices, each of which is punishable by up to five years in prison. Toure is also charged with 23 counts of wire fraud for using the illegally acquired cards to access the balances on the cards. Each count is punishable by up to 30 years in prison. The indictment also charges Toure with one count of being an illegal alien in possession of a firearm, a crime punishable by up to ten years in prison.
Toure appeared before U.S. Magistrate Judge Michael J. Newman and entered pleas of not guilty. U.S. District Judge Timothy S. Black will schedule a trial for Toure, who was arrested on May 7 and is being held without bond.
The Supplemental Nutrition Assistance Program (SNAP), formerly known as the Food Stamp Program is a federally funded national nutrition assistance program jointly administered by the United States Department of Agriculture (USDA), the Food and Nutrition Service (FNS) and individual state agencies. In Ohio, this program is administered by the Ohio Department of Job and Family Services. Allegations of fraud in the system are investigated on the federal level by the USDA Office of Inspector General and on the state level by the Ohio Investigative Unit in the Ohio Department of Public Safety.Stewart commended the cooperative investigation between agents of the USDA Inspector General, Secret Service, and the Ohio Investigative Unit, and Assistant U.S. Attorney Dwight Keller, who is prosecuting the case.
An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.
###Federal Jury Convicts Man of String of Armed Robberies of Las Vegas Convenience Stores During 2013Read the Press Release
LAS VEGAS, Nev. – Following an 11-day federal jury trial, a man accused of robbing 13 convenience stores and a small casino in the Las Vegas area during 2013, was convicted today of all counts charged, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
Abdul Howard, 48, of Las Vegas, was convicted of one count of felon in possession of a firearm, 14 counts of interference with commerce by robbery, and 12 counts of possession of a firearm during, in relation to, and in furtherance of a crime of violence. Howard is scheduled to be sentenced by U.S. District Judge Gloria M. Navarro on Nov. 6, 2014, at 9:00 a.m., and faces mandatory life in prison.
“Violent criminals such as Abdul Howard are a threat and danger to the entire community,” said U.S. Attorney Bogden. “We are pleased to be able to assist local law enforcement and use federal laws in these types of cases, which carry stiff mandatory minimum penalties and ensure that career criminals such as Mr. Howard are incarcerated for very long periods of time.”
According to the court records and evidence introduced at trial, Howard robbed 13 convenience stores and one casino in the Las Vegas area between Jan. 15, 2013, and April 16, 2013. Howard robbed most of the businesses late at night using a semi-automatic handgun which he used to threatened store employees and some customers. In some of the robberies, Howard pointed the handgun at an employee or stuck a gun into the employee’s body or head. In one instance, Howard fired a handgun at an employee, and in another, Howard shot an employee in the neck. Investigators dubbed Howard the “Cinched Hoodie Robber,” because he typically entered the businesses wearing a hooded sweatshirt with the hood “cinched” up around his face in an effort to conceal his identity.Howard has at least five prior felony convictions in New York, Florida, and Nevada related to robbery, burglary, cocaine distribution and sexually motivated coercion.
This case was investigated by the FBI, Las Vegas Metropolitan Police Department Robbery Section, and North Las Vegas Police Department, as part of the Safe Streets Task Force and Project Safe Neighborhoods program, and prosecuted by Assistant U.S. Attorneys Phillip N. Smith, Jr. and Cristina D. Silva.Eagle Butte Man Sentenced for Assaulting, Resisting and Impeding Federal Officers and Discharge of A Firearm During A Crime of ViolenceRead the Press Release
United States Attorney Brendan V. Johnson announced that an Eagle Butte, South Dakota, man convicted of Assaulting, Resisting and Impeding Federal Officers and Discharge of a Firearm During a Crime of Violence was sentenced on June 3, 2014, by U.S. District Judge Roberto A. Lange.
Jason Todd Garreau, age 28, was sentenced to 20 years in custody, 5 years of supervised release, and a $200 special assessment to the Federal Crime Victims Fund. The 20-year sentence was ordered to be served consecutively to a 25-year sentence that was handed down last week in State Court for Attempted Murder, to which Garreau had previously pled guilty.
Garreau was indicted by a federal grand jury on November 5, 2013. He pled guilty on March 5, 2014.
The conviction stems from a standoff Garreau had with law enforcement on October 31, 2013, at a Pierre residence. The standoff followed a high speed chase that ensued on October 30, 2013, when law enforcement attempted to serve an arrest warrant on an individual. When the individual’s car was located, police discovered it was being driven by Garreau. Police attempted to execute a traffic stop on the vehicle, but Garreau then led police on a high speed chase, which was aborted on east Highway 34.
The Bureau of Indian Affairs soon discovered the vehicle on the Crow Creek Reservation, and a new pursuit ensued. While in pursuit, Garreau made multiple phone calls to his cousin, who came to aid Garreau in the pursuit and the cousin opened fire on law enforcement, which allowed Garreau to flee the scene. The next day, Garreau was located at a residence in Pierre, and a SWAT team was called in to assist in the apprehension. When the SWAT team entered the residence, Garreau fired multiple shots from a Benelli shotgun and a Hi-Point handgun, injuring two police officers. Garreau surrendered and was taken into custody.
The investigation was conducted by the Federal Bureau of Investigation, with assistance from the U.S. Marshals Service, South Dakota Division of Criminal Investigation, South Dakota Highway Patrol, Hughes County Sheriff’s Office, and the Pierre Police Department. The case was prosecuted by Assistant U.S. Attorney Meghan N. Dilges.
Garreau was immediately turned over to the custody of the U.S. Marshals Service.
Drug Trafficker Sentenced 17.5 Years in PrisonRead the Press Release
Trafficker’s Wife Receives A Two And A Half Year Sentence For Laundering Drug Proceeds
STATESVILLE, N.C. – Manuel Ocampo, Jr., 39, of Anaheim, Calif., was sentenced today to 210 months in prison for his role as a supplier of methamphetamine, cocaine, heroin, marijuana and other narcotics, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina. In addition to the prison term, U.S. District Judge Richard L. Voorhees ordered Ocampo to serve five years of supervised release. Judge Voorhees also sentenced today Manuel Ocampo’s wife, Yulisma Ocampo, 37, to 30 months in prison and three years of supervised release, for conspiring to launder the proceeds of drug trafficking.
U.S. Attorney Tompkins is joined in making today’s announcement by Brock D. Nicholson, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in Georgia and the Carolinas; Greg McLeod, Director of the State Bureau of Investigation (NC SBI); Chief Tom Adkins of the Hickory Police Department and Sheriff Coy Reid of the Catawba County Sheriff’s Office.
According to court documents and proceedings, the drug conspiracy lasted from 2011 to September 18, 2012. During that time, the Ocampos travelled from California to the Hickory, N.C. area to deliver a variety of narcotics, including methamphetamine, cocaine, heroin, and marijuana, among others. On May 4, 2012, law enforcement in Hickory N.C. seized over four pounds of 97% pure methamphetamine, more than one and half pounds of black tar heroin and over two pounds of powder heroin from a hidden compartment in the roof of the Ocampos’ minivan. During Manuel Ocampo’s arrest on that date, Yulisma Ocampo hid her husband’s cell phone and she subsequently picked-up drug proceeds from customers, until she was arrested in July 2012.
Two other conspirators involved in the drug scheme, Joey Carroll and Peter Anthony Sanders, were previously sentenced. Carroll was sentenced to 113 months in prison and five years of supervised release. Sanders was sentenced to 36 months in prison and four years of supervised release.
Both Manuel and Yulisma Ocampo will remain in federal custody and will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
This investigation into the case was led by HSI and SBI, with the assistance of several other law enforcement agencies, to include the Hickory Police Department and the Catawba County Sheriff’s Office. The prosecution for the government is being handled by Assistant U.S. Attorney Steven R. Kaufman of the U.S. Attorney’s Office in Charlotte.
Department of Justice and Federal Trade Commission Announce Agenda for June 23, 2014, Joint Agency Workshop on Conditional Pricing PracticesRead the Press Release
The Department of Justice and the Federal Trade Commission (FTC) have issued the agenda for their joint public workshop, which will be held on June 23, 2014, to explore the economic and legal analysis of conditional pricing practices among firms in a supply chain. Announced in early May, the workshop will focus on conditional pricing arrangements – practices in which prices are explicitly or effectively contingent on commitments to purchase or sell a specified share or volume of a single product or a mix of multiple products – such as loyalty or bundled pricing.
A principal goal of the workshop will be to advance the economic understanding of the potential harms and benefits of conditional pricing practices and to reexamine their treatment under the antitrust laws. As detailed in the press release first announcing the event, participants will focus primarily on: 1) Economic Learning, and 2) Law and Policy Issues related to conditional pricing practices.
The Department of Justice and the FTC are interested in receiving comments on conditional pricing practices, and will accept written submissions from the public from now through Aug. 22, 2014, 60 days after the event. Interested parties may submit public comments online. Submitted comments will be made publicly available on the Department of Justice and FTC websites.
The all-day workshop is free and open to the public. Individuals are encouraged, but not required, to register in advance for the workshop by sending an email to [email protected], Please include “RSVP” in the subject line. Seating will be on a first-come, first-serve basis. It will take place at the FTC’s new satellite conference center, Constitution Center, 400 Seventh Street, SW, Washington, DC 20024.
Reasonable accommodations for people with disabilities are available upon request. Requests should be submitted by e-mail to [email protected] , or by calling Lara Kittelson at 202-326-3388. Requests should be made in advance. Please include a detailed description of the accommodation needed and provide contact information.