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Wednesday 28 May 2014
Ochoa-Perez Indicted on Additional ChargeRead the Press Release
LAREDO, Texas – A federal grand jury has added a charge of conspiracy to possess with the intent to distribute heroin, cocaine and methamphetamine to the current kidnapping allegations against Raul Ochoa-Perez, announced United States Attorney Kenneth Magidson.
Ochoa-Perez, 42, of Laredo, was originally indicted for conspiracy to kidnap and kidnapping on May 14, 2014. The new charge alleges Ochoa-Perez has been a part of a conspiracy to transport drug-laden fire extinguishers since at least 2012. Further, the indictment alleges that in the course of the drug conspiracy, Ochoa-Perez had another individual abducted, bound and taken to Mexico where Ochoa-Perez threatened the lives of that individual’s family if he did not work for him.
Following the return of the original indictment, he made an appearance before U.S. Magistrate Judge J. Scott Hacker, at which time he was ordered detained pending further criminal proceedings. He is expected to appear again on the new charges in the near future.
Ochoa-Perez faces a mandatory minimum of 10 years and up to life in prison, upon conviction, as well as a potential $10 million fine. The U.S. is also seeking a money judgment in the amount of $3,066,975.
The case is the result of an investigation led by the FBI with the assistance of Homeland Security Investigations, Drug Enforcement Administration and Texas Department of Public Safety. Assistant United States Attorney James Hepburn is the handling the case.
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.New York Man Sentenced to Three Years in Prison, Ordered to Repay $1.5 Million After Skimming from Trucking CompaniesRead the Press Release
A New York man was sentenced to three years in prison and ordered to pay more than $1.5 million in restitution for his role in a conspiracy that skimmed more than $1.7 million from trucking companies, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Special Agent in Charge Marlon Miller, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Detroit, which covers Michigan and Ohio.
Dilshod Sidikov, aka “Dema”, 26, of Brooklyn, N.Y., was sentenced to 37 months in prison after previously pleading guilty to conspiracy to commit wire fraud and money laundering.
“Criminal enterprises are constantly coming up with new ways to rip off companies, consumers and customers,” Dettelbach said. “This group tried to turn truck stops into their own personal ATMs. We will continue to work with our partners in law enforcement to stamp out these schemes.”
“Criminal groups are under the false impression that money-transfer scams crimes are low risk and high reward,” said Miller. “Today’s significant sentencing and subsequent fines underscore the very real consequences that await those who participate in these types of schemes.”
Twenty-six people have been found guilty of crimes related to the conspiracy.
Sidikov and other conspirators obtained account numbers and codes used by independent trucking companies to wire money to the companies’ drivers from February 2011through November 2012. They accomplished the objectives of the conspiracy and wire fraud as set forth below:
Electronic fund processing companies (EFP) such as Fleet One, Comdata, and TCH are used by trucking companies to electronically transfer funds to truck drivers at truck stops and other locations throughout the country. Drivers typically obtain the money by providing information to a customer service representative at a participating truck stop. That information is then relayed via wire to an EFP processing center. Once the EFP has authorized the request for money, the truck stop will issue a check to the driver who then cashes it.
From the above period of time, known and unknown individuals obtained account numbers and codes used by trucking companies to issue checks through EFPs. These account numbers and codes were obtained without the knowledge or consent of the trucking companies. The known and unknown individuals then provided the stolen account numbers and codes via telephone calls or text messages to the defendants, according to the indictment.
The defendants traveled to truck stops in the Northern District of Ohio and elsewhere. Once at the truck stops, they posed as truck drivers, approached customer service counters, presented the stolen account numbers and codes, and requested checks from EFPs such as Comdata, Fleet One and TCH, according to the indictment.
Customer service representatives at the truck stops then processed the requests by sending the account numbers and codes via wire to EFP processing centers located outside the Northern District of Ohio. The EFPs then authorized the requests and authorized the truck stop customer service representatives, via wire, to print checks for the defendants. They then endorsed the checks and cashed them at the truck stops, according to the indictment.
In total, the defendants fraudulently obtained a gross amount of more than $1.7 million, according to court documents.
From about February 2011, and continuing to on or about November 2012, Sidikov and other defendants conspired to launder money by transferring the proceeds of this scheme overseas and then back to the United States, according to the indictment.
The investigation preceding the indictment was conducted by the Department of Homeland Security Investigations (HSI). The matter was presented to the grand jury and is being prosecuted by Assistant United States Attorney David M. Toepfer.
New Jersey Business Owner Charged with Operating Corporate Ponzi Scheme Resulting in More Than $42 Million in LossesRead the Press Release
NEWARK, N.J. – The owner of a group of freight payment, logistics, and shipping businesses headquartered in Branchburg, N.J., surrendered today to face charges she operated them as a multimillion-dollar Ponzi scheme, U.S. Attorney Paul J. Fishman announced.
Shirley Sooy, 63, currently of Fort Smith, Ark., surrendered in Newark this afternoon to inspectors of the U.S. Postal Inspection Service and special agents of IRS-Criminal Investigation on a criminal complaint charging her with wire fraud conspiracy, wire fraud, mail fraud, and transacting in criminal proceeds. She is scheduled for an initial appearance and bail hearing this afternoon before U.S. Magistrate Judge James B. Clark III in Newark federal court.
According to the complaint unsealed today:
From 2003 through April 2013, Sooy, through a collection of businesses operating under the umbrella of the “TransVantage Group,” entered contracts with corporate clients – referred to in the complaint as the “victim companies.” TransVantage audited freight bills generated by common carriers and freight forwarders hired by the victim companies. TransVantage was obligated to pay the audited and approved freight bills to the carriers from funds provided by those companies, and the funds were supposed to be held in trust by TransVantage until paid over to the carriers. The victim companies also paid TransVantage for its purported auditing services, payments separate and apart from the carrier payment funds.
Sooy allegedly operated TransVantage as a Ponzi scheme, which resulted in more than $42 million in losses to the victim companies. Sooy and others comingled the funds from the victim companies – funds that were to have been paid to carriers – into two accounts and then misused those funds in various ways. They paid prior, unpaid carrier bills of particular victim companies using funds provided by other, unrelated victim companies; they funded TransVantage’s payroll obligations and they funded the obligations of various TransVantage subsidiaries.
They also subsidized millions of dollars in personal expenses, including mortgage payments for personal properties owned by Sooy and others in Bloomsbury, N.J.; Phillipsburg, N.J.; Waretown, N.J.; and Palm Beach Gardens, Fla.; a 48-foot yacht purchased by Sooy with others; a $135,000 Maserati automobile purchased by a conspirator; payments for personal credit card charges incurred by Sooy and her family members; and payments for remodeling Sooy’s home.
The counts of wire fraud conspiracy, wire fraud, and mail fraud with which Sooy is charged each carry a maximum potential penalty of 20 years in prison and a fine of up to $250,000, or twice the gain or loss from the offense. The counts of transacting in criminal proceeds with which Sooy is charged each carry a maximum potential penalty of 10 years in prison and a fine of $250,000, or twice the gain or loss from the offense.
U.S. Attorney Fishman credited postal inspectors of the U.S. Postal Inspection Service, under the direction of Postal Inspector in Charge Maria L. Kelokates; and special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Jonathan D. Larsen, for the investigation leading to today’s charges.
The government is represented by Assistant U.S. Attorneys Zach Intrater and Shirley U. Emehelu of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
The charge and allegations contained in the complaint are merely accusations, and the defendant is considered innocent unless and until proven guilty.Today’s arrest is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorney’s offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
14-194Defense counsel: Michael J. Rogers Esq., Somerville, N.J.
Sooy, Shirley Complaint
Montour Man Pleads Guilty to Bankruptcy FraudRead the Press Release
A man who concealed assets from his creditors and the United States Bankruptcy Court pled guilty today in federal court in Cedar Rapids.
Jay Freese, age 51, from Montour, Iowa, was convicted of one count of concealment of bankruptcy assets.
In a plea agreement, Freese admitted that he filed for bankruptcy protection in September 2009, in the United States Bankruptcy Court in the Northern District of Iowa, in Cedar Rapids, Iowa. As part of seeking that protection, Freese was required to disclose all of his assets. Freese admitted that he did not disclose a Bobcat S175 skid loader or a Kubota tractor/loader. Freese further admitted that, during a bankruptcy hearing, he falsely testified under oath that he had sold the Bobcat and Kubota. In fact, Freese had never sold the Bobcat or Kubota and had retained possession of the equipment at all times, fraudulently concealing those assets with the intent to deceive his creditors, the bankruptcy trustee, and the United States Bankruptcy Court.
Sentencing before United States District Court Chief Judge Linda R. Reade will be set after a presentence report is prepared. Freese remains free on bond previously set pending sentencing. Freese faces a possible maximum sentence of five years’ imprisonment, a $250,000 fine, a $100 special assessment, and three years of supervised release following any imprisonment.
The case is being prosecuted by Assistant United States Attorney C.J. Williams and was investigated by the United States Trustee’s Office and the Federal Bureau of Investigation.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 14-CR-14-LRR.
Minnesota-Based Medtronic Inc. to Pay $9.9 Million<br /> to Resolve Claims That Company Paid Kickbacks to PhysiciansRead the Press Release
Medtronic Inc., of Fridley, Minnesota, has agreed to pay the United States $9.9 million to resolve allegations under the False Claims Act that the company used various types of payments to induce physicians to implant pacemakers and defibrillators manufactured and sold by Medtronic, the Justice Department announced today.
“Improper financial incentives have the potential to compromise physician medical judgment,” said Assistant Attorney General Stuart F. Delery of the Justice Department’s Civil Division. “This case demonstrates the Department of Justice’s commitment to pursue medical device manufacturers that use improper financial relationships to influence physician decision-making.”
The United States alleged that Medtronic caused false claims to be submitted to Medicare and Medicaid by using multiple types of illegal kickbacks to induce physicians to implant Medtronic pacemakers and defibrillators. Specifically, Medtronic allegedly induced physicians to use its products by: 1) paying implanting physicians to speak at events intended to increase the flow of referral business; 2) developing marketing/business development plans for physicians at no cost; and 3) providing tickets to sporting events. The United States alleged that Medtronic paid the remuneration to persuade the physicians to continue using Medtronic products or to convert their business from a competitor’s products.
“Decisions about devices used to treat cardiac rhythmic disease should be based on the best interests of the patient, not on whether the manufacturer is going to pay a kickback,” said U.S. Attorney Benjamin Wagner of the Eastern District of California. “These sorts of improper financial incentives not only undermine the integrity of medical decisions, they also waste taxpayer funds and are unfair to competitors who are trying to play by the rules.”
“As this settlement indicates, health care executives who try to boost profits by paying kickbacks to doctors will instead pay the government for their improper conduct,” said Special Agent in Charge Ivan Negroni of the U.S. Department of Health and Human Services Office of Inspector General’s San Francisco Office. “We will continue to work with the Department of Justice to root out illegal, wasteful business arrangements.”
The settlement announced today stems from a whistleblower complaint filed by a former employee of Medtronic, Adolfo Schroeder, pursuant to the qui tam provisions of the False Claims Act, which permit private persons to bring a lawsuit on behalf of the United States and to share in the proceeds of the suit. Schroeder will receive approximately $1.73 million.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Secretary of Health and Human Services Kathleen Sebelius. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $19.2 billion through False Claims Act cases, with more than $13.7 billion of that amount recovered in cases involving fraud against federal health care programs.
The settlement with Medtronic Inc. was the result of a coordinated effort among the Department of Justice’s Civil Division; the U.S. Attorney’s Office for the Eastern District of California; and the Office of Inspector General of the U.S. Department of Health and Human Services.
The lawsuit is captioned United States ex rel. Schroeder v. Medtronic, Inc., No. 2:09-cv-0279 WBS EJB (E.D. Cal.). The claims settled by this agreement are allegations only, and there has been no determination of liability.Milford Man Sentenced to 33 Months in Federal Prison for Being A Felon in Possession of A FirearmRead the Press Release
CONCORD, NEW HAMPSHIRE – Richard Ouellette, 28, of Milford, was sentenced in United States District Court for the District of New Hampshire to 33 months in federal prison for being a felon in possession of a firearm, announced United States Attorney John P. Kacavas.
Ouellette was previously convicted of accomplice to armed robbery as a result of his participation in a 2004 armed robbery at Hans Market in Manchester, New Hampshire. As a result of that state felony conviction, Ouellette was sentenced to three years imprisonment at the New Hampshire State Prison. Federal law prohibits persons convicted of felony crimes from owning or possessing firearms or ammunition.
During an undercover operation in January, 2011, Ouellette sold a German, Model Makarov, 9mm pistol and ammunition to agents of the United States Drug Enforcement Administration. The Bureau of Alcohol, Tobacco, Firearms and Explosives subsequently determined that the firearm had been reported stolen from a residence during a home burglary in Deering, New Hampshire.
United States Attorney John P. Kacavas praised the efforts of federal law enforcement in this case and said, “ensuring that persons who violate the prohibition against possessing firearms are brought to justice is a central mission of my office. We will continue to work closely with our state and federal partners to enforce federal gun laws.”
The case was investigated by the United States Drug Enforcement Administration and the Bureau of Alcohol, Tobacco, Firearms and Explosives. The case was prosecuted by Assistant United States Attorney Jennifer Cole Davis.
Miami Resident Pleads Guilty to Identity Theft Scheme Involving Theft of Mail from Apartment Complex MailboxesRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Jose A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), and Ronald J. Verrochio, Inspector in Charge, U.S. Postal Inspection Service (USPIS), Miami Division, announce that Rodelyn Lamour, 26, of Miami, pled guilty to one count of conspiracy to commit mail theft, in violation of Title 18, United States Code, Section 371, one count of possession of a Postal Service key, in violation of Title 18, United States Code, Section 1704, one count of mail theft, in violation of Title 18, United States Code, Section 1708, one count of use of unauthorized access devices, in violation of Title 18, United States Code, Section 1029(a)(2), and one count of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A(a)(1). Sentencing is scheduled for July 17, 2014, at 2:30 p.m. before Senior U.S. District Judge James Lawrence King.
According to the stipulated statement of facts executed by the parties, from August 2013 to January 2014, Lamour and co-conspirator, Nestor Herrera, conspired to steal mail from various apartment complexes in Miami-Dade County. On various occasions, Herrera acted as a lookout while Lamour used a stolen Postal Service key to open apartment complex cluster mailboxes and steal mail. After stealing mail that contained debit cards, Lamour used the debit cards to make cash withdrawals at various banks, to buy United States Postal Money Orders, and to conduct wire transfers via money gram. The seventeen debit cards he used during a one-year period contained $45,729.17 in fraudulent tax refunds. Lamour knew the debit cards belonged to real people who did not authorize him to use their debit cards.
Mr. Ferrer commended the investigative efforts of IRS-CI and USPIS. The case is being prosecuted by Assistant U.S. Attorney Vanessa Snyder.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Mexican Man Heads to Federal Prison for Importing Cocaine into the United StatesRead the Press Release
LAREDO, Texas – Sergio Alejandro Valero Ibarra, 48, a resident of Mexico, has been ordered to prison following his conviction of possession with the intent to distribute more than five kilograms and more of cocaine, announced United States Attorney Kenneth Magidson. Ibarra pleaded guilty Aug. 29, 2013.
Today, Senior U.S. District Judge George Kazen handed Ibarra a total sentence of 78 months in federal prison. At the hearing, additional evidence was presented including Ibarra’s prior crossings into the U.S. He is expected to face deportation proceedings following his release from prison.
On June 21, 2013, Ibarra was detained by Customs and Border Protection (CBP) officers as he attempted to enter the United States at the Gateway to Americas Bridge II, in Laredo. At that time, CBP Officers noticed fingerprints and potential tampering with Valero’s vehicle fuel tank. Ibarra and his vehicle were then sent for secondary inspection, at which time 13.82 kilograms of cocaine were discovered bundled inside the fuel tank.
Ibarra admitted to importing and trafficking the drugs for individuals in Mexico. He stated he was driving the drug-laden vehicle for delivery in Houston and admitted he previously made three other drug deliveries in Houston.
Ibarra will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The case was investigated by CBP and Homeland Security Investigations. Assistant U.S. Attorney Sanjeev Bhasker prosecuted the case.Methamphetamine Cooks Sentenced to Serve 208 Months & 228 Months in PrisonRead the Press Release
GREENEVILLE, Tenn. – Two individuals involved in a methamphetamine conspiracy were sentenced on May 28, 2014, by the Honorable J. Ronnie Greer, U.S. District Judge. Randy J. Davis, 42, of Trade, Tenn., was sentenced to serve 228 months in federal prison, to be followed by eight years of supervised release, for conspiring to manufacture methamphetamine. Terrance L. Turnmire, 31, of Mountain City, Tenn., was sentenced to serve 208 months in federal prison, to be followed by five years of supervised release, for conspiring to manufacture and distribute methamphetamine. There is no parole in the federal system.
A total of 20 individuals, including the two sentenced today, 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 others named in the indictment were also charged with distributing methamphetamine. All others in this case have been adjudicated guilty and will be sentenced later this year.
The charges came 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.
Davis and Turnmire were both methamphetamine cooks. Davis admitted in his plea agreement that he had conservatively manufactured at least 35 but less than 50 grams of methamphetamine. Turnmire admitted in his plea agreement that he had conservatively manufactured at least 50 but less than 150 grams of methamphetamine and that he had distributed at least 35 but less than 50 grams of actual methamphetamine throughout the course of the conspiracy. Evidence presented during Turnmire’s sentencing hearing demonstrated that on several occasions, methamphetamine had been manufactured in Turnmire’s apartment, where he lived along with another co-defendant and their 18 month old child. The evidence presented also demonstrated that Turnmire’s apartment was within 1,000 feet of a public school.
“These significant sentences demonstrate that manufacturing methamphetamine is taken very seriously due to the inherent danger and risk involved in the process. Methamphetamine cooks have been and will continue to be aggressively prosecuted by this office to ensure that the public is protected by those who endanger the safety of our communities,” said U.S. Attorney William C. Killian.
This investigation was a result of the collaborative efforts of the Johnson County Sheriff’s Office, 1st Judicial District Drug Task Force, Tennessee Methamphetamine and Pharmaceutical Drug Task Force, and the Drug Enforcement Administration. Assistant U.S. Attorneys Suzanne Kerney-Quillen and Caryn Hebets represented the United States.
Member of Hartford Drug Trafficking Ring Sentenced to 8 Years in Federal PrisonRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that LUIS ANTONIO MENDEZ, 32, of Hartford, was sentenced today by U.S. District Judge Michael P. Shea in Hartford to 96 months of imprisonment, followed by four years of supervised release, for his role in a Hartford-based narcotics trafficking ring.
According to court documents and statements made in court, this matter stems from a joint law enforcement investigation headed by the Federal Bureau of Investigation’s Northern Connecticut Violent Crimes Task Force and the Hartford Police Department into gang-related narcotics trafficking in Hartford’s South End. The investigation specifically targeted a heroin and cocaine trafficking organization headed by Angel Rosa, also known as “Little” and “Daddy,” who is a member of the Los Solidos street gang, and his cousin, Angel Rosa, also known as “Mo Betta” and “Fab.” “Little,” supervised the drug trafficking ring, which included several other family members, through fear and intimidation. “Mo Betta” managed the daily operations of the organization, facilitated the delivery and transportation of large quantities of heroin, and supervised numerous drug sellers who distributed heroin and other narcotics in the Zion Street area. At times, “Little” and “Mo Betta” used, or threatened to use, violence to ensure the success of the organization.
MENDEZ delivered substantial quantities of heroin for the Rosa drug trafficking organization.
As a result of the investigation, 21 individuals were charged with various federal offenses, and law enforcement officers seized narcotics, one firearm, approximately $230,000 in cash, eight vehicles and jewelry.
While he was involved in this heroin trafficking conspiracy, MENDEZ was on probation for committing a robbery with a firearm in the area of 600 Zion Street. He was convicted of robbery in the first degree and was sentenced to 15 years in jail, suspended after seven years, and five years of probation. MENDEZ’s criminal history also includes convictions for assault, risk of injury to a minor, possession with intent to sell narcotics and carrying a pistol without a permit.
MENDEZ has been detained since his arrest on April 17, 2013. On January 8, 2014, he pleaded guilty to one count of conspiracy to possess with intent to distribute, and to distribute, heroin.
Angel Rosa aka “Little” and Angel Rosa aka “Mo Betta” each pleaded guilty to one count of conspiracy to possess with intent to distribute, and to distribute, 100 grams or more of heroin. On May 15, 2014, “Little” was sentenced to 235 months of imprisonment, and on April 29, 2014, “Mo Betta” was sentenced to 165 months of imprisonment.
This matter was investigated by the Federal Bureau of Investigation’s Northern Connecticut Violent Crimes Task Force, which includes members of the Connecticut State Police, Hartford Police Department, East Hartford Police Department, Connecticut Department of Correction and Connecticut National Guard. The Connecticut State Police’s Emergency Services Unit, Hartford Police Department’s Emergency Response Team, Capital Region Emergency Response Team, Drug Enforcement Administration, Homeland Security Investigations and the New Britain, East Hartford, Wethersfield and Manchester Police Departments have provided valuable assistance to the investigation.
The case is being prosecuted by Assistant U.S. Attorneys Brian Leaming and Patrick Caruso.
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Tom Carson
(203) 821-3722
[email protected]Medtronic Inc. to Pay $9.9 Million to Resolve Claims That Company Paid Kickbacks to PhysiciansRead the Press Release
SACRAMENTO, Calif. — Medtronic Inc. of Fridley, Minn., has agreed to pay the United States $9.9 million to resolve allegations under the False Claims Act that the company used various types of payments to induce physicians to implant pacemakers and defibrillators manufactured and sold by Medtronic, United States Attorney Benjamin B. Wagner announced today.
“Improper financial incentives have the potential to compromise physician medical judgment,” said Stuart F. Delery, Assistant Attorney General for the Civil Division of the Department of Justice. “This case demonstrates the Department of Justice’s commitment to pursue medical device manufacturers that use improper financial relationships to influence physician decision-making.”
The United States alleges that Medtronic caused false claims to be submitted to Medicare and Medicaid by using multiple types of illegal kickbacks to induce physicians to implant Medtronic pacemakers and defibrillators. Specifically, Medtronic allegedly induced physicians to use its products by: 1) paying implanting physicians to speak at events intended to increase the flow of referral business; 2) developing marketing and business development plans for physicians at no cost; and 3) providing tickets to sporting events. The United States alleges that Medtronic paid the remuneration to persuade the physicians to continue using Medtronic products or to convert their business from a competitor’s products.
“Decisions about devices used to treat cardiac rhythmic disease should be based on the best interests of the patient, not on whether the manufacturer is going to pay a kickback,” said U.S. Attorney Wagner. “These sorts of improper financial incentives not only undermine the integrity of medical decisions, they also waste taxpayer funds and are unfair to competitors who are trying to play by the rules.”
“As this settlement indicates, health care executives who try to boost profits by paying kickbacks to doctors will instead pay the government for their improper conduct,” said Ivan Negroni, Special Agent in Charge for the U.S. Department of Health and Human Services Office of Inspector General’s San Francisco Office. “We will continue to work with the Department of Justice to root out illegal, wasteful business arrangements.”
The settlement announced today stems from a whistleblower complaint filed by a former employee of Medtronic, Adolfo Schroeder, according to the qui tam provisions of the False Claims Act that permits private persons to bring a lawsuit on behalf of the United States and to share in the proceeds of the suit. Mr. Schroeder will receive approximately $1.73 million.
The settlement with Medtronic Inc. was the result of a coordinated effort among the Department of Justice’s Civil Division, Commercial Litigation Branch; the U.S. Attorney’s Office for the Eastern District of California; and the Office of Inspector General of the U.S. Department of Health and Human Services. Assistant United States Attorney Catherine Swann handled the investigation for the Eastern District of California.
The claims settled by this agreement are allegations only, and there has been no determination of liability.
Maryland Man Sentenced to 100 Months in Prison for Supplying Network That Distributed Cocaine and Heroin-Arrest Followed DEA Investigation-Read the Press Release
WASHINGTON – Herman Curtis Malone, 45, of Upper Marlboro, Md., was sentenced today to 100 months in prison for his role in a network that distributed substantial quantities of cocaine and heroin in the Washington, D.C. area.
The sentencing, in the U.S. District Court for the District of Columbia, was announced by U.S. Attorney Ronald C. Machen Jr. and Karl C. Colder,Special Agent in Charge of the Washington Division Office of the Drug Enforcement Administration (DEA).
Malone pled guilty in March 2014 to a charge of conspiracy to distribute and possess with intent to distribute cocaine and heroin. He was sentenced by the Honorable Ellen S. Huvelle. Upon completion of his prison term, Malone will be placed on five years of supervised release; during that time-frame, he must perform 75 hours of community service each year. Malone also must pay a forfeiture money judgment of $150,000.
Malone, who helped run youth basketball programs, had been convicted of a narcotics offense during the 1990s in Prince George’s County, Md. He was arrested on the current offenses on Aug. 9, 2013, following a DEA Group-43 Cross-Border-Task-Force investigation.
Three others have pled guilty to charges in the case. Clarence Redd, 35, of Washington, D.C., pled guilty to a charge of distribution of heroin that took place in August of 2012. He was sentenced to a 90-month prison term. Derico Williams, 36, of Silver Spring, Md., and Stephen Williams, 30, of Washington, D.C., pled guilty to a charge of conspiracy to distribute and possess with intent to distribute cocaine. Both men are awaiting sentencing; they are not related.
Another defendant, Micah Jerry Bidgell, 47, of Washington, D.C., is a fugitive.
According to the government’s evidence, Malone himself conspired with others from August 2012 to August 2013 to distribute cocaine and heroin in the Washington, D.C. area. Malone acknowledged that as part of the conspiracy he was responsible for at least five kilograms of cocaine and at least 100 grams of heroin.
On Aug. 9, 2013, the DEA found a loaded .40-caliber handgun in the upstairs bedroom of Malone’s home in Upper Marlboro. Downstairs in the basement, agents found 998.5 grams of cocaine and 81.2 grams of heroin; a bag of .40-caliber ammunition; and cocaine residue in a sink and trash can. Malone, as someone who had been previously convicted in 1991 of a felony offense for possession with intent to distribute cocaine in Prince George’s County, Md., was not lawfully able to possess a firearm.
“Curtis Malone had the opportunity to be a positive role model for young people, but with today’s prison sentence, he becomes a cautionary tale,” said U.S. Attorney Machen. “The lesson is simple: peddling drugs and toting guns will put you behind bars. We hope that young people who see Malone’s fate will steer clear of the lifestyle that led to his downfall.”
“The cloak that Curtis Malone wore for more than two decades has been removed and a man who was once entrusted with his community's most valuable assets, its children, will no longer live freely in the community that he was covertly destroying,” said Special Agent in Charge Colder “DEA has assured that Mr. Malone will pay a dear price for dealing heroin and cocaine on the streets of the District, all the while touting himself as a mentor to children. As a father, I cannot think of anything worse in life than being entrusted the future of our youth and abusing that privileged as Mr. Malone has clearly done.”
In announcing the sentence, U.S. Attorney Machen and Special Agent in Charge Colder commended the work of those who investigated the case for the DEA. They also expressed appreciation to the Metropolitan Police Department (MPD), the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Prince George’s County Police Department, the Maryland State Police, and the Maryland Park Police. Assistance was provided by the Organized Crime Drug Enforcement Task Force (OCDETF).
U.S. Attorney Machen and Special Agent in Charge Colder also acknowledged the work of those who handled the case at the U.S. Attorney’s Office, including Paralegal Specialists Rommel Pachoca, Starla Stolk, Candace Battle, Teesha Tobias, Regan Gibson, Kim Hall and Mary Downing; former Paralegal Specialist Jeremy Stoller; Legal Assistants Jessica Moffatt, Tammy Scott, Latoya Wade, and Diane Brashears, and former Legal Assistant Niya Attucks. They recognized the work of Assistant U.S. Attorneys Allessandra Stewart, Zia Faruqui, and Arvind K. Lal, of the Asset Forfeiture and Money Laundering Section. Finally, they commended the efforts of Assistant U.S. Attorneys Stephen J. Gripkey, Darlene M. Soltys, and Nihar R. Mohanty, as well as former Assistant U.S. Attorney Michelle Zamarin, of the Violent Crime and Narcotics Trafficking Section, who investigated and prosecuted the case.
14-122Little Falls Man Pleads Guilty to Conspiring to Distribute MethamphetamineRead the Press Release
MINNEAPOLIS — Today in federal court, a 30-year-old Little Falls man pleaded guilty to conspiring to distribute methamphetamine. James Kelly Benson specifically pleaded guilty to one count of Conspiracy to Distribute Methamphetamine. Benson, who was indicted on February 12, 2014, entered his guilty plea before United States District Court Judge Donovan W. Frank.
In his plea agreement, Benson admitted that he had been working with others to distribute methamphetamine since June of 2012. Officers of the Central Minnesota Violent Offender Task Force (CMVOTF) also observed Benson selling methamphetamine.
On January 16, 2014, FBI agents, working with CMVOTF officers, executed a search warrant at Benson’s home; they found approximately 60 grams of methamphetamine in Benson’s garage, which he admitted to purchasing with the intent to distribute it within the state of Minnesota.
Because Benson was convicted in Meeker County of a separate felony drug offense in 2005, he faces a mandatory minimum sentence of 20 years in prison. Judge Frank will determine his sentence at a future hearing, yet to be scheduled.
This case is the result of an investigation by the Federal Bureau of Investigation and the Central Minnesota Violent Offender Task Force. It is being prosecuted by Assistant United States Attorney Thomas Calhoun-Lopez.Lassen County Man Sentenced for Child Pornography OffenseRead the Press Release
SACRAMENTO, Calif. — Bruce Austin Watkins, 43, of Westwood, was sentenced today by United States District Judge Lawrence K. Karlton to seven years and six months in prison, to be followed by 36 months of supervised release, for receiving child pornography, United States Attorney Benjamin B. Wagner announced.
According to court documents, law enforcement executed a search at Watkins’s residence on May 6, 2013. Two laptops and an external hard drive seized from Watkins contained 500 videos and 220 images of child pornography that had been collected by Watkins between January 21, 2007, and April 29, 2013. Among the files were images showing the violent sexual molestation of children as young as toddlers. At the time of the search, Watkins told law enforcement that he had been looking at child pornography online for 15 to 20 years.
This case was the product of an investigation by the Federal Bureau of Investigation and the Northern Nevada Child Exploitation Task Force. Assistant United States Attorney Kyle Reardon is prosecuting the case.
Thisase 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 those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about Internet safety education.
Lakewood Man Sentenced to Seven Years in Prison, Ordered to Pay $7 Million for Defrauding Euclid Credit UnionRead the Press Release
A Lakewood man was sentenced to more than seven years in prison and ordered to pay nearly $7 million in restitution for embezzling from a Euclid credit union and using the money to pay his personal credit card accounts, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland office.
William J. Memmer, 63, pleaded guilty earlier this year to one count of embezzlement and one count of making false entries in credit union records and reports.
“This defendant betrayed the trust of the credit union’s members and his employer,” Dettelbach said. “He simply took other people’s money to pay his debts. Now he’ll pay his debt to society.”
“This lengthy sentence is reflective of the magnitude of Mr. Memmer’s embezzlement and fraud he orchestrated for numerous years,” Anthony said. “Citizens should have a sense of trust that their investments are safe and the FBI will continue efforts to root out greedy fraudsters like Mr. Memmer.”
Memmer was employed as Assistant Manager/Treasurer of the GIC Federal Credit Union (GIC), which maintained an office at 26255 Euclid Avenue, in Euclid, Ohio.
From as early as 2006, Memmer maintained approximately 15 credit card accounts. He took blank GIC checks and drafted them payable to the credit card companies in payment of his personal obligation, then concealed the taking of the checks and embezzlement of the GIC funds. These actions caused a loss to the credit union of at least $1,843,007, according to the information.
As early as 2003, Memmer falsified quarterly financial reports to hide operating losses. He is also alleged to have falsified confirmations of GIC assets by as much as $5.7 million, according to the information.
Upon discovery of the fraud, the National Credit Union Administration closed GIC, and began the liquidation process.
The case is being prosecuted by Assistant U.S. Attorney James V. Moroney, following investigation by agents of the Federal Bureau of Investigation’s Cleveland Office.
Lakeland Couple Pleads Guilty to Bank Fraud ConspiracyRead the Press Release
Tampa, Florida – United States Attorney A. Lee Bentley, III announces that Jovanna Deshawn Forte (39) and William Boyd Burns (44) have each pleaded guilty to one count of conspiracy to commit bank fraud and face a maximum penalty of 30 years in federal prison. In addition, both agreed to a money judgment in the amount of approximately $385,450, the proceeds of the bank fraud. Burns pleaded guilty yesterday, and Forte pleaded guilty on May 12, 2014. The sentencing hearings are scheduled for August 28, 2014, at 9:00 a.m. before Judge Virginia M. Hernandez Covington.
According to court documents, Forte and Burns used other peoples’ accounts at local banks to deposit third-party checks that were written to the account holders, in amounts ranging from $1,500 to $3,600. These third-party checks were fraudulent and false when they were deposited by Forte and Burns because the checks were written on closed accounts and accounts that did not have sufficient funds to pay the amount of the check. The checks were deposited into these accounts by ATM, after the financial institution was closed. Forte and Burns then withdrew or attempted to withdraw funds, both in cash and through debit card purchases, which had been credited to the account from the fraudulent check deposits. The withdrawn funds were then used for personal expenditures. Forte and Burns were recorded on video tape surveillance using nearly 200 accounts at three financial institutions: Mid-Florida Federal Credit Union, SunTrust Bank and Wachovia Bank. They obtained at least $385,450 in funds from their withdrawals and purchases.
This case was investigated by United States Postal Inspection Service, Florida Department of Law Enforcement, and the Polk County Sheriff’s Office. It is being prosecuted by Assistant United States Attorney Kelley C. Howard-Allen.
King’s Daughters Medical Center to Pay Nearly $41 Million <br /> to Resolve Allegations of False Billing <br /> for Unnecessary Cardiac Procedures and KickbacksRead the Press Release
Ashland Hospital Corp. d/b/a King’s Daughters Medical Center (KDMC) has agreed to pay $40.9 million to resolve allegations that it submitted false claims to the Medicare and Kentucky Medicaid programs for medically unnecessary coronary stents and diagnostic catheterizations and had prohibited financial relationships with physicians referring patients to the hospital, the Justice Department announced today.
Assistant Attorney General Stuart F. Delery of the Justice Department’s Civil Division, U.S. Attorney Kerry Harvey for the Eastern District of Kentucky and Special Agent in Charge Derrick L. Jackson at the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Kentucky region made the announcement.
“Hospitals that place their financial interests above the well-being of their patients will be held accountable,” said Assistant Attorney General Delery. “ The Department of Justice will not tolerate those who abuse federal health care programs and put the beneficiaries of these programs at risk by providing medically unnecessary care.”
The government alleged that, between 2006 and 2011, KDMC billed for numerous unnecessary coronary stents and diagnostic catheterizations performed by KDMC physicians on Medicare and Medicaid patients who did not need them. The government also alleged that the physicians falsified medical records in order to justify these unnecessary procedures, which allegedly generated millions of dollars in Medicare and Kentucky Medicaid reimbursements for KDMC.
“The conduct alleged in this matter is unacceptable, victimizing both taxpayers and patients,” said U.S. Attorney Harvey. “Treatment decisions motivated by financial gain undermine public confidence in our health care system and threaten vital federal programs upon which so many of our citizens rely. We will not relent in our efforts to protect the public from the sort of systematic misconduct alleged in this case.”
The settlement also resolves allegations that KDMC violated the Stark Law by paying certain cardiologists salaries that were unreasonably high and in excess of fair market value. The Stark Law is designed to limit the influence of money on physicians’ medical decision-making by prohibiting financial relationships between hospitals and referring physicians, unless these relationships meet certain designated exceptions.
In connection with this settlement, KDMC has agreed to enter into a Corporate Integrity Agreement with HHS-OIG, which obligates the hospital to undertake substantial internal compliance reforms and to commit to a third-party review of its claims to federal health care programs for the next five years.
“Medically unnecessary procedures can cause serious health issues, cost the taxpayers millions of dollars each year and drain the Medicare Trust Fund,” said Special Agent in Charge Jackson. “The OIG will continue to protect beneficiaries and hold health care providers accountable for improper claims.”
“This type of alleged conduct deceives individuals when they are seeking medical treatment and are vulnerable,” said Special Agent in Charge Perrye K. Turner of the FBI’s Louisville Field Division. “The level of funds involved in this matter is staggering. This money has been stolen from the patients and the taxpayers.”
The Commonwealth of Kentucky will receive approximately $1,018,380, which represents the state’s share of the recovered Medicaid funds. The Medicaid program is funded jointly by the federal and state governments.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Secretary of Health and Human Services Kathleen Sebelius. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $19 billion through False Claims Act cases, with more than $13.4 billion of that amount recovered in cases involving fraud against federal health care programs.
The investigation was conducted by the FBI, the HHS-OIG, the Kentucky Office of Attorney General, Medicaid Fraud and Abuse Control Unit, the Commercial Litigation Branch of the Department of Justice’s Civil Division and the U.S. Attorney’s Office for the Eastern District of Kentucky. The claims settled by this agreement are allegations only, and there has been no determination of liability.Judge Sends La Cosa Nostra Soldier to PrisonRead the Press Release
PHILADELPHIA – Eric Esposito, 43, of Philadelphia, PA, was sentenced today to 27 months in prison for conducting an illegal gambling business on behalf of the Philadelphia La Cosa Nostra Family. In addition to the prison term, U.S. District Judge Eduardo C. Robreno ordered three years of supervised release and a fine of $4,000.
On Feb. 21, 2014, after a week-long contested trial, a jury convicted Esposito of conducting an illegal gambling business involving the use of video poker machines at a private social club known as the “First Ward Republican Club” located in South Philadelphia. According to evidence presented at trial, Esposito was a fully initiated mob solider who worked in concert with other mob members to carry out the illegal gambling business on behalf of the Philadelphia La Cosa Nostra Family.
A total of 13 leaders, members and associates of the Philadelphia La Cosa Nostra Family have been convicted by a jury or pleaded guilty as part of this case. To date, 12 defendants have been sentenced and one is awaiting sentencing.
The case is being investigated by the FBI, the Internal Revenue Service-Criminal Investigations, the Pennsylvania State Police, the New Jersey State Police, the Philadelphia Police Department, and the U.S. Department of Labor’s Office of Inspector General Office of Labor Racketeering and Fraud Investigations, and the U.S. Department of Labor’s Employee Benefits Security Administration. Additional assistance was provided by the New Jersey Department of Corrections.
The case is being prosecuted by Trial Attorney John S. Han of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorneys Frank A. Labor III and Suzanne B. Ercole of the Eastern District of Pennsylvania. Valuable prosecutorial assistance was provided by the Pennsylvania Office of the Attorney General.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Jett Industries Pays $500,000 to Settle Civil Fraud AllegationsRead the Press Release
Colliersville Contractor Accepts Responsibility for Submission of False Certification to EPA in Connection With Construction of a Water Pump Station in the Village of Briarcliff Manor
ALBANY, NEW YORK – United States Attorney Richard S. Hartunian and Environmental Protection Agency (EPA) Inspector General Arthur A. Elkins, Jr. announced today that Jett Industries, Inc. (Jett) has paid the United States $500,000 to settle allegations that Jett violated the False Claims Act by falsely certifying compliance with the American Recovery and Reinvestment Act of 2009 (Recovery Act) in connection with a federally-funded contract it performed for the Village of Briarcliff Manor. Jett, a Colliersville-based general contractor, specializes in the construction and modification of water and wastewater treatment facilities.
In January 2009, Jett was awarded a contract to construct a water pump station for the Village of Briarcliff Manor (the Project). A component of the Project was a bladder surge tank, which was to be made, in part, of steel. Prior to the date Jett began construction on the Project, the company knew that it would be paid with Recovery Act funds and, as such, any steel used on the Project was required to be produced in the United States. As time went on, several Jett employees learned that the tank Jett ordered had been manufactured in France, and those same employees expressed concern amongst one another that installation of a French-manufactured tank on the Project may violate the Recovery Act’s “Buy American” provision. Nevertheless, Jett accepted delivery of and decided to install the non-compliant tank on the Project. A Jett employee later used a Jett computer to create a certification, purportedly from the tank’s manufacturer, which falsely asserted that the French-made tank had been manufactured in the United States. That same day, the same Jett employee sent the false certification to a consultant for the Village of Briarcliff Manor, falsely representing that the Project was compliant with the Recovery Act, so that Jett could obtain payment for the Project.
As part of the settlement, Jett admitted, acknowledged, and accepted responsibility for its actions, including an admission that one of its former employees created a false certification, and caused a third party to present that false certification to EPA, “to cover up Jett’s violation” of the requirement that all steel goods used on the Project be produced in the United States. Jett also agreed as part of the settlement to work with the Village of Briarcliff Manor to bring the Project into compliance with the Recovery Act.
United States Attorney Hartunian said: “Protecting taxpayer dollars is one of our core priorities. Companies that do business with the government must do so honestly, or suffer the consequences. The Recovery Act was designed to stimulate our Nation’s economy in the wake of an economic crisis unlike any since the Great Depression, and we will continue to pursue vigilantly those who misuse funds designated for that purpose. With today’s settlement, Jett has accepted responsibility for its misconduct and has agreed to fix a problem it alone created.”
“The American people trust that the laws of their land will be followed or, when they are not, violations will be rectified,” said EPA Inspector General Elkins. “This settlement is the result of a careful investigation and an excellent working relationship between the EPA Office of Inspector General and the United States Attorney’s Office for the Northern District of New York. I am most appreciative of that office’s support and look forward to working together in the future to ensure that public funds are used as intended.”
The investigation and settlement were the result of a coordinated effort between the United States Attorney’s Office for the Northern District of New York and EPA’s Office of Inspector General, with assistance from officials with the Village of Briarcliff Manor. The United States was represented by Assistant United States Attorney Adam J. Katz.
Idaho Corporation Fined for Criminal Asbestos ViolationsRead the Press Release
Waterline Renovation Project Led to $3,980,000 Cleanup
BOISE — Owyhee Construction Incorporated, a Boise-based corporation, was sentenced to three years of probation for violating the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). District Judge Edward J. Lodge also fined Owyhee Construction $100,000, ordered it to implement a compliance and ethics program, and pay restitution. Two employees of Owyhee Construction were previously sentenced to prison terms for acts related to the disposal of asbestos.
Owyhee Construction Inc., was the successful bidder on a $3 million waterline renovation project in Orofino, Idaho, a rural community in north central Idaho. The contract documents warned Owyhee Construction that the company may encounter up to 5,000 linear feet of cement asbestos pipe (CAP) during the renovation. CAP is a non-friable form of asbestos that is encapsulated in a cement matrix. When the CAP is broken or crushed by heavy equipment or subjected to cutting and grinding by machinery, it becomes subject to regulation because of the threat to public health from airborne fibers.
The onsite manager and foreman failed to properly supervise the renovation. While working in the trenches to replace pipe, workers removed CAP from the trenches which ended up as part of fill material on sixteen properties around Orofino. Owyhee Construction never reported the releases of the asbestos. The EPA cleanup cost is just under $4 million. Owyhee Construction was ordered to pay restitution to the EPA based on resolution of a civil suit currently under way with other potentially responsible parties.
Wendy Olson, United States Attorney for the District of Idaho said, “Businesses have a firm, and in this case contractual, obligation to handle harmful materials with care and in compliance with environmental regulations that protect the public from unknowing harm. This case should send the strong message that those who fail to meet these obligations will be investigated, caught and punished.”
Tyler Amon Special Agent in Charge for EPA’s Criminal Investigation Division in Seattle said, “Deceived into thinking Owyhee Construction had provided them with ‘clean fill,’ citizens and businesses of Orofino used the material to fill their, driveways and yards. The result: a contaminated mixture of crushed pipe and debris laced with harmful asbestos spread over 16 separate sites at a cost of $4 million to taxpayers. Egregious, unlawful conduct has a consequence.”
The case was investigated by the U.S. Environmental Protection Agency. The case was prosecuted by Assistant U.S. Attorney, D. Marc Haws from the District of Idaho and Senior Trial Attorney J. Ronald Sutcliffe of the Justice Department’s Environmental Crimes Section.
Hogsett Announces Two Federal Gun Crime SentencingsRead the Press Release
Hogsett and Curry continue collaboration of prosecution at both a federal and local level to make Indianapolis streets safer
INDIANAPOLIS – Joseph H. Hogsett, the United States Attorney, announced two recent sentences today for federal firearms violations that exemplify the strong working relationship between the United States Attorney’s Office and the Marion County Prosecutor’s Office, a collaboration that makes Indianapolis neighborhoods safer.
Michael Poge, 46, of Indianapolis, was sentenced to 70 months (nearly six years) and Nicholas Hines 31, Indianapolis was sentenced to 92 months (nearly eight years) in federal prison both for illegally possessing a firearm as a convicted felon.
Poge was arrested by IMPD officers in May 2013, in the 8800 block of East 41st Place when he was involved in a violent disturbance. He was in possession of a revolver loaded with three live rounds and two that had recently been discharged. Hines was arrested by IMPD officers in July 2013 when they visited Hines’ home on the near Eastside during a probation sweep. There they found a .40 caliber pistol that belonged to Hines. Officers also found a pair of pants with a holster that fit the gun, which indicated Hines was regularly carrying the weapon. Between them, the two men accumulated 14 felonies, all committed in Marion County.
“Credit should go where it is due. Marion County Prosecutor Terry Curry saw the need to improve the cooperation between his office and the United States Attorney’s Office. As part of his vision, Prosecutor Curry has since cross-designated several of his best prosecutors to screen gun cases and make thoughtful decisions about whether to prosecute repeat violent offenders in state court or in federal court. In this sense, Terry and his office have always been ‘out front’ in the challenge of ridding Indianapolis of the high level of gun violence it has experienced,” Hogsett explained.
The United States Attorney’s Violent Crime Initiative began in 2011, and is intended to focus on the “worst of the worst” violent offenders by marshaling federal resources to provide local partners the additional tools they may need to succeed in their effort to promote peace. In 2011, only 14 firearms charges were filed. Since then, over 325 firearms cases have been prosecuted. By charging these cases federally, violent felons have received 50% more time than they would have received in state courts and in several cases, they received over 300% higher sentences. Additionally, federal defendants serve 85 % of their sentence.
“Working closely with the Marion County Prosecutor and his staff, the U.S. Attorney’s Office will continue to pledge federal resources to help stem the tide of violent crime in Indianapolis,” said Hogsett. “Working together is the single most effective way to help make our communities safer and these sentences support that pledge by taking the most violent offenders, who terrorize our neighborhoods off our streets.”
According to Special Assistant U.S. Attorney (SAUSA) Thomas Lupke, who is prosecuting the case for the government, Poge and Hines face three years of supervised release after their sentence. Lupke currently serves as a SAUSA for Hogsett’s office and splits his time as a deputy prosecutor with the Marion County Prosecutor’s Office where he specializes in narcotic- and gun-related cases.
Green Cove Springs Convenience Store Owner Pleads Guilty to Tax Refund TheftRead the Press Release
Jacksonville, Florida – United States Attorney A. Lee Bentley, III announces that Antoun Arbaji today pleaded guilty to stealing government property described as fraudulently-obtained tax refunds. Arbaji faces a maximum penalty of ten years in federal prison, as well as an obligation to pay back approximately $1,909,403.66 in restitution to the United States. A sentencing date has not yet been set.
According to the plea agreement, Abas Issa (“Issa”), a co-defendant, owned and operated a convenience store in Green Cove Springs, Florida, known as V&J Stores, Inc. Arbaji owned and operated another convenience store (“Fina Express”) in Green Cove Springs, a few blocks away.
In 2011, Issa began obtaining both fraudulently-obtained tax refund checks and refund anticipation loan checks from a source in Tampa. Issa, in turn, located individuals like Arbaji who, for a percentage fee, would cash the checks through their business accounts. After cashing the checks, Arbaji would remit the cash proceeds to Issa. Issa, in turn, would keep a fee and remit the remainder of the proceeds to the source of the checks in Tampa. During 2011, Arbaji cashed more than $1.5 million in fraudulently-obtained tax refund checks and more than $400,000 in fraudulently-obtained refund anticipation loan checks, using his Fina Express business account. After cashing the checks, he delivered the proceeds to Issa, who, after collecting his fee, delivered the remaining proceeds to a source in Tampa. Many of the fraudulent checks were issued on behalf of individuals who were deceased at the time the tax returns were filed.
According to court records, more than $352,000 was seized from Arbaji’s bank account prior to the return of an indictment in this case.
This case was investigated by the Internal Revenue Service - Criminal Investigation, the United States Secret Service, and the Florida Department of Law Enforcement. It is being prosecuted by Assistant United States Attorney Mac D. Heavener, III.
Gloucester County, N.J., Man Sentenced to 20 Years in Prison for Receipt of Child PornographyRead the Press Release
CAMDEN, N.J. - A Gloucester County, N.J., man was sentenced today to 240 months in prison for receipt of images of child sexual abuse, U.S. Attorney Paul J. Fishman announced.
Bryan Jacobs, 43, of Deptford, N.J., previously pleaded guilty before U.S. District Judge Renée Marie Bumb to one count of a superseding indictment charging him with receipt of child pornography. Jacobs has been in custody since his arrest in January 2010 on a criminal complaint charging him with related conduct. Judge Bumb imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
Jacobs created a profile on the social networking site MySpace, using the false persona of “Brianna,” purportedly a young woman from Philadephia. On Nov. 30, 2008, Jacobs, posing as Brianna, engaged in MySpace chats with a male minor. Jacobs received images that depicted the minor engaged in sexually explicit conduct, and downloaded those images to his computer.
In addition to the prison term, Judge Bumb sentenced Jacobs to 15 years of supervised release. Restitution will be determined at a later date.
U.S. Attorney Fishman credited special agents of the U.S. Secret Service, Philadelphia Field Office, under the direction of Special Agent in Charge Cynthia R. Wofford; and the Gloucester County Prosecutor’s Office, under the direction of Prosecutor Sean F. Dalton, with the investigation.
The government is represented by Assistant U.S. Attorneys Justin Danilewitz and Diana Vondra Carrig of the U.S. Attorney’s Office Criminal Division in Camden.
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Defense counsel: Peter Levin Esq., PhiladelphiaGeorgia Man Arraigned on Fraud and Money Laundering ChargesRead the Press Release
R.C. Patel a/k/a Rajesh C. Patel, 55, of Duluth, Georgia, was arraigned today in U.S. District Court in Nashville, on investment fraud and related money laundering charges, announced David Rivera, United States Attorney for the Middle District of Tennessee. Patel pleaded not guilty to these charges.
“Investment fraud schemes cause irreparable harm across a broad spectrum – to the individual investors who lose their savings to such schemes, to small businesses trying to raise capital legitimately, and to the integrity of our economy as a whole,” said U.S. Attorney Rivera. “This office will continue to prioritize and vigorously prosecute these types of cases.”
“The Federal Bureau of Investigation stands ready with its federal, state and local partners to protect the community from those who seek financial gain through the use of fraudulent and deceptive practices,” said FBI Special Agent in Charge Todd McCall. “Those who engage in such illegal tactics can rely on being the subject of a vigorous and thorough investigation, no matter where they are located. Anyone with information regarding fraudulent conduct is encouraged to immediately contact their local FBI office.”
On May 14, 2014, a federal grand jury, sitting in the Middle District of Tennessee, indicted Patel on five counts of wire fraud, one count of mail fraud, and four counts of money laundering. According to the indictment, Patel schemed to defraud a Brentwood, Tenn. investor of more than $1,500,000 in connection with two investments in hotel properties.
In one investment involving the purchase of a hotel building, Patel is alleged to have misrepresented to the investor that he had successfully bid on and acquired the mortgage when, in fact, he had not even placed a bid on the property. Instead, Patel used the $500,000 provided by the investor for his personal and unrelated purposes. The indictment also alleges that Patel induced the same investor to invest an additional $750,000 in a partnership formed by Patel to purchase a beachfront hotel in Myrtle Beach, South Carolina. In exchange for his investment, Patel promised the investor a 25% ownership interest in the hotel partnership. However, after collecting the investor’s funds, Patel revised the partnership’s operating agreement to remove any reference to the investor and his ownership interest.
The indictment further alleges that Patel used the $750,000 provided by the investor to reduce an unrelated personal loan in his own name, and shifted the remaining proceeds to an account under his control through a series of transfers and deposits.
If convicted, Patel faces up to 20 years in prison on each fraud count and up to ten years in prison on each money- laundering count, in addition to potential fines and forfeiture of any money or property derived from the fraud.
The case was investigated by the FBI. The United States is represented by Assistant U.S. Attorney William F. Abely.
An indictment is merely an accusation and is not evidence of guilt. This defendant is presumed innocent unless and until proven guilty in a court of law.
Former State Legislator Pleads Guilty to Bank FraudRead the Press Release
TOPEKA, KAN. - A former Kansas state legislator pleaded guilty Tuesday to defrauding Farmers and Merchants Bank of Colby, Kan., of more than $465,000, some of which he deposited in his campaign account, U.S. Attorney Barry Grissom said.
Trent K. LeDoux, 40, Holton, Kan., pleaded guilty to one count of bank fraud. In his plea, he admitted he applied for three loans from the bank, falsely representing that he was going to use all the funds to buy cattle that would serve as the collateral for the loans. In fact, he used some of the money to pay off existing debts and to make contributions to his political campaign account.
Sentencing is set for Aug. 11. He faces a maximum penalty of 30 years in federal prison and a fine up to $1 million. Grissom commended the FBI and Assistant U.S. Attorney Richard Hathaway for their work on the case.
Former San Bernardino Police Officer Found Guilty of Federal Civil Rights Charges Stemming from Sexual Assaults of ProstitutesRead the Press Release
RIVERSIDE, California – A former officer with the San Bernardino Police Department was convicted today of federal civil rights charges for forcing two prostitutes to perform sex acts while he was in uniform.
Jose Jesus Perez, 46, of Menifee, was found guilty this morning of two felony counts of deprivation of rights under color of law for sexually assaulting two victims in 2011. The jury determined that both offenses involved aggravated sexual abuse, and that one attack involved a kidnapping and bodily injury.
Perez is scheduled to be sentenced by United States District Judge Virginia A. Phillips on August 18, at which time he faces a potential sentence of life in federal prison.
Perez has been in custody since he was arrested last September in Texas. The arrest was the result of a federal grand jury indictment that alleged Perez forcibly had sex with two women who told investigators that they engaged in the sex acts demanded by Perez out of fear because he was a police officer.
The evidence presented during a week-long trial showed that Perez groped a woman and caused her to perform oral sex by using force against her on April 25, 2011.
The jury also found that Perez had unlawful sexual intercourse with another woman on two occasions in August 2011.
The two victims testified about Perez forcing them to have sex in vehicles and hotel rooms. A third woman testified that Perez had aggressively solicited sex from her while he was in uniform. The three women each testified that they feared repercussions if they did not comply with Perez’s demands.
The jury in the case also convicted Perez of one misdemeanor civil rights offense related to the second time he demanded sex from the second victim in August 2011. Additionally, Perez was acquitted of one misdemeanor offense related to allegations that he forced the second woman to have sex in September 2011.
Perez became a police officer in 1997, when he was hired by the Los Angeles Police Department. Perez worked for the LAPD until 2008, when he went to work for the San Bernardino Police Department. Perez was released from employment by SBPD in December 2012.
The investigation into Perez was conducted by the San Bernardino Police Department and the FBI.
Release No. 14-067
Former Oil Company Human Resources Manager Sentenced to More Than 4 Years in Prison for $700,000 Embezzlement and Tax CrimesRead the Press Release
TULSA, Okla. — United States Attorney for the Northern District of Oklahoma Danny C. Williams Sr. announced today that United States District Court Judge James H. Payne sentenced James Rhea Cooley, a former Regional Human Resource Manager for Newfield Exploration Mid-Continent Inc., a Houston, Texas-based oil and gas company, with offices in Tulsa, Oklahoma, to serve 55 months in Federal prison for wire fraud involving the embezzlement of $696,000 from that company, and tax fraud for failure to report that stolen income resulting in unpaid taxes of $226,089. Additionally, Cooley was ordered to pay $595,107.46 in restitution to Newfield’s insurance company, Federal Insurance; $105,049.86 to Newfield; $70,300 to ConAgra Foods; and $226,089 to the IRS. An anonymous tipster called the company’s ethics hotline to report Cooley. This prompted an internal investigation leading to a joint FBI and Internal Revenue Service, Criminal Investigation probe of these crimes.
James Rhea Cooley, 45, of Tulsa, was charged by Criminal Information on August 26, 2013, with one-count of wire fraud and three counts of willfully making and subscribing a false federal income tax return. He pleaded guilty on November 19, 2013, to one count of wire fraud and one count of willfully making and subscribing a false federal income tax return. Cooley worked as the Regional Human Resources Manager at the Tulsa office of Newfield where he was authorized to approve invoices for services provided to the company.
According to court documents filed in the case, from August 2008 to January 2011, Cooley devised and executed a scheme to defraud his then-employer Newfield. In 2008, the defendant created the fictitious consulting company, Total HR Service and Consulting, created a website and opened a bank account for that company. Cooley would then falsify invoices for services that had not been performed, submit them to Newfield and deposit the payment check from Newfield into the fraudulent consulting company’s bank account. Cooley would then spend the embezzled funds for personal expenses that included jewelry, airline tickets, and a Mexican condominium.
In imposing the sentence, Judge Payne also considered additional relevant criminal conduct of Cooley in shaping Cooley’s sentence. After being terminated for the false invoice scheme at Newfield in February 2011, Cooley obtained a similar job with ConAgra Corporation in Council Bluff, Iowa, where he committed the very same crime. ConAgra losses totaled approximately $70,000.00. This second crime occurred from April 2012 until September 2012, after Cooley had already admitted the Newfield fraud to federal investigators and was supposedly cooperating with them.
As part of his sentence, a criminal forfeiture money judgment was entered against Cooley to provide restitution for the victims. The criminal forfeiture money judgment is in the amount of $693,300.
The case was a joint investigation by the Internal Revenue Service, Criminal Investigations and the Federal Bureau of Investigation. Assistant United States Attorneys Charles M. McLoughlin and Catherine Depew prosecuted on behalf of the United States.
###Former Longshoremen Plead Guilty to Extortion Conspiracy Involving Christmastime Tribute PaymentsRead the Press Release
Genovese Crime Family Associate Also Pleads Guilty to Illegal Gambling Charges
NEWARK, N.J. - Two former longshoremen admitted today that they conspired to extort others in Local 1 and Local 1235 of the International Longshoremen’s Association (ILA) for Christmastime tribute payments, and an associate of the Genovese organized crime family charged in the same case admitted running an illegal sports betting operation.
New Jersey U.S. Attorney Paul J. Fishman and Eastern District of New York U.S. Attorney Loretta E. Lynch announced the guilty pleas.
Rocco Ferrandino, 71, of Lakewood, N.J., and Michael Trueba, 78, of Kearny, N.J. – both former supervisors on the New Jersey piers – pleaded guilty to conspiring to extort Christmastime tributes from the union members – count three of the second superseding indictment against them. Richard Dehmer, 78, of Springfield, N.J., an associate of the Genovese organized crime family of La Cosa Nostra, also pleaded guilty today to conspiring to operate, and operating, an illegal sports betting operation with others. Ferrandino, Trueba and Dehmer entered their guilty pleas before U.S. District Judge Claire C. Cecchi in Newark federal court.
According to documents filed in this case and statements made in court:
During their guilty pleas, Ferrandino and Trueba admitted they conspired with each other and others to compel tribute payments from ILA union members, who made the payments based on actual and threatened force, violence and fear. The timing of the extortions typically coincided with the receipt by certain ILA members of “Container Royalty Fund” checks, a form of year-end compensation. Ferrandino, the former head timekeeper at Maher Terminals, and Trueba, the former vice president of ILA Local 1235, were suspended from their positions following their arrests in this case.
Charges are still pending against three defendants in the superseding indictment, including a racketeering conspiracy charge against Stephen Depiro, 58, of Kenilworth, N.J., a soldier in the Genovese family. Members of the Genovese family, including Depiro, are charged with conspiring to collect tribute payments from New Jersey port workers at Christmastime each year through their corrupt influence over union officials, including the last three presidents of Local 1235.
The charge to which Ferrandino and Trueba pleaded guilty carries a maximum potential penalty of 20 years in prison and a $250,000 fine. The charges to which Dehmer pleaded guilty carry a maximum potential penalty of five years in prison and a $250,000 fine. Sentencing is currently scheduled for Sept. 23, 24 and 30, 2014, for Dehmer, Ferrandino and Trueba, respectively.
U.S. Attorneys Fishman and Lynch credited the FBI in New Jersey, under the direction of Special Agent in Charge Aaron T. Ford, and in New York, under the direction of Assistant Director in Charge George Venizelos, as well as the U.S. Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, under the direction of Acting Special Agent in Charge Cheryl Garcia, with the investigation leading to today’s guilty pleas. They also thanked the Waterfront Commission of New York Harbor for its cooperation and assistance in the investigation.
The government is represented by Assistant U.S. Attorney Jacquelyn M. Kasulis of the U.S. Attorney’s Office, Eastern District of New York, and Assistant U.S. Attorney Anthony Mahajan, of the U.S. Attorney’s Office, District of New Jersey.
The charges and allegations against Depiro and the other remaining defendants are merely accusations, and they are considered innocent unless and until proven guilty.14-195
Defense counsel: Rocco Ferrandino: Vincent S. Verdiramo Esq., Jersey City, N.J.
Michael Trueba: Charles S. Lorber Esq., West Orange, N.J.
Richard Dehmer: Chester Keller Esq., NewarkFormer IRS Employees Plead Guilty to Unemployment Benefits FraudRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that six former employees of the Internal Revenue Service have pleaded guilty to receiving unemployment benefits while they worked at the agency.
Michelle Glavin, 32, and Christopher Castillo, 34, both of Kansas City, Mo., pleaded guilty today in separate appearances before U.S. District Judge Dean Whipple to the charge contained in a Dec. 10, 2013 federal indictment. Co-defendants Jesse Love, 61, and Tiffani Harding, 27, both of Kansas City, Mo., Shalonda Bradley, 41, of Grandview, Mo., and Berneta Weedin, 59, of Platte Woods, Mo., pleaded guilty on Tuesday, May 27, 2014.
By pleading guilty, each of the defendants admitted they claimed unemployment benefits while they were employed by the IRS. The defendants are no longer employed at the IRS.
Each of the defendants pleaded guilty to stealing government property by fraudulently claiming unemployment benefits to which they were not entitled. Under the terms of their plea agreements, the defendants must pay restitution for the amount of benefits illegally received.
Glavin fraudulently obtained $5,144 in Missouri benefits, plus $16,204 in federal benefits while employed at the IRS, for a total of $21,348.
Castillo fraudulently obtained $6,365 in Missouri benefits and $4,727.80 in federal benefits while working at the IRS, for a total of $11,093.
Love fraudulently obtained $8,214 in Missouri benefits and$1,404 in federal benefits while working at the IRS, for a total of $9,618.
Harding fraudulently obtained $2,664 in Missouri benefits, plus $8,650 in federal benefits while employed at the IRS, for a total of $11,315.
Bradley fraudulently obtained $6,279 in Missouri benefits, plus $250 in federal benefits while employed at the IRS, for a total of $6,529.
Weedin fraudulently obtained $3,014 in Missouri benefits, plus $3,113 in federal benefits while employed at the IRS, for a total of $6,127.
This case is being prosecuted by Assistant U.S. Attorney Jane Pansing Brown. It was investigated by the Treasury Inspector General for Tax Administration and the Missouri Department of Labor and Industrial Relations, Division of Employment Security.Former Hedge Fund Analyst Pleads Guilty in Manhattan Federal Court to Insider Trading SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that MATTHEW TEEPLE, a former analyst for a hedge fund investment adviser located in San Francisco, California (“Investment Adviser A”), pled guilty today to participating in an insider trading scheme that resulted in at least $27 million in ill-gotten gains and losses avoided. Specifically, TEEPLE admitted that in 2008 he received and passed on to Investment Adviser A illegally obtained inside information about Foundry Networks, Inc. (“Foundry”), a technology company located in Santa Clara, California. This inside information included the fact – before it became public on July 21, 2008 – that Brocade Communications, Inc. (“Brocade”) was planning to acquire Foundry. TEEPLE pled guilty today before the Honorable James C. Francis, IV, United States Magistrate Judge.
Manhattan U.S. Attorney Preet Bharara said: “Matthew Teeple admitted that he received inside information from a tech company insider and passed it on to others, who reaped a windfall of at least $27 million. Teeple, the 85th defendant to be convicted of insider trading by plea or trial in this District since 2009, has earned himself a likely prison term.”
According to the agreement pursuant to which TEEPLE entered his plea of guilty today, the underlying criminal Complaint filed March 26, 2013, the Superseding Indictment filed February 20, 2014, and statements made during court proceedings:
TEEPLE obtained material, non-public information relating to Foundry, including information relating to monthly and quarterly financial reporting, well before such information became public. More specifically, the inside information that TEEPLE received from an insider at Foundry included quarterly financial performance numbers during the first quarter of 2008, information regarding Brocade’s intended acquisition of Foundry in July 2008, and information about developments regarding the Brocade-Foundry transaction in October 2008.
TEEPLE passed the inside information to others, including another analyst at Investment Adviser A. Using the inside information TEEPLE provided about Foundry, Investment Adviser A reaped gains and avoided losses of at least $27 million in 2008.
Others TEEPLE tipped with the inside information included two acquaintances of his, John Johnson and Karl Motey. Regarding Brocade’s 2008 acquisition of Foundry, TEEPLE told both Johnson and Motey not only that Foundry was going to be acquired by Brocade, but also the approximate acquisition price, which turned out to be substantially accurate. Johnson traded on this information and profited in excess of $136,000. On March 18, 2013, he pled guilty to conspiracy and securities fraud charges before United States District Judge John F. Keenan.
TEEPLE, 42, of San Clemente, California, pled guilty to Count One of a four-count Superseding Indictment. Count One charges a conspiracy to commit insider trading and carries a maximum term of five years in prison. As part of his guilty plea, TEEPLE agreed to forfeit $553,890, and further agreed not to seek a term of imprisonment other than the statutory maximum term of five years. TEEPLE is scheduled to be sentenced by the Honorable Robert P. Patterson on September 26, 2014, at 10:00 a.m. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
TEEPLE’s co-defendant, David Riley, is scheduled to proceed to trial before Judge Patterson on July 7, 2014.
Mr. Bharara praised the investigative work of the FBI and thanked the Securities and Exchange Commission, which has filed civil charges in a separate action.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. 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. Since the inception of FFETF in November 2009, the Justice Department has filed more than 12,841 financial fraud cases against nearly 18,737 defendants including nearly 3,500 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Telemachus P. Kasulis and Sarah E. McCallum, and Special Assistant U.S. Attorney Michael P. Holland, are in charge of the prosecution.
Former Escambia & Santa Rosa School Teacher Sentenced on Federal Child Pornography ChargesRead the Press Release
PENSACOLA, FLORIDA - - United States Attorney Pamela C. Marsh announced that Jeffrey B. Richards, age 63, of Milton, was sentenced today on federal charges related to the online receipt of child pornography.
For approximately ten years, Richards utilized peer-to-peer software to download vast amounts of child pornography, including more than 100,000 sexualized images and videos of children. During this time, Richards was teaching in local schools. The prosecution revealed that in his online searches, Richards used search terms specifically geared toward obtaining child sexual exploitation images and videos. In addition, Richards possessed at least one audio file in which a young female portraying a “student” was engaged in graphic sexual acts with her “teacher” in exchange for a favorable grade in school.
Senior United States District Judge Lacey A. Collier sentenced Richards to six years imprisonment to be followed by ten years of supervised release. Upon release, Richards will be required to register as a sexual offender.The prosecution was a result of a joint investigation by the Federal Bureau of Investigation, the Department of Homeland Security, the Pensacola Police Department, and other members of the Internet Crimes Against Children Task Force. The case was prosecuted by Assistant U.S. Attorney David L. Goldberg.
Former Engineer at Two Global Medical Technology Corporations Admits Theft of Trade SecretsRead the Press Release
TRENTON, N.J. – An engineer who formerly lived in Mahwah, N.J., admitted today to stealing trade secrets from two global medical technology companies based in northern New Jersey, U.S. Attorney Paul J. Fishman announced.
Ketankumar Maniar, 37, aka “Ketan Maniar,” pleaded guilty today before U.S. District Judge Joel A. Pisano in Trenton federal court to an information charging him with two counts of theft and attempted theft of trade secrets for his own economic benefit. Maniar, an Indian national, has been in custody since his June 2013 arrest.
According to documents filed in this case and statements made in court:
C.R. Bard Inc. (Bard), based in Murray Hill, N.J., and Becton, Dickinson and Co. (BD), based in Franklin Lakes, N.J., are among the world’s leading manufacturers of medical technologies. From November 2004 until his resignation on Jan. 22, 2011, Maniar worked as an engineer at Bard’s Salt Lake City facility and was responsible for developing molding processes and specifications for catheters, ports and other medical products. From February 2012 until his resignation on May 24, 2013, Maniar worked as a staff engineer at BD’s Franklin Lakes headquarters, where he helped manufacture pre-fillable syringes and pen injectors.
Through his work at Bard and BD, Maniar was able to steal secret information related to the companies’ products, including Bard’s development of the first implantable port used for power injection of pharmaceutical drugs throughout the body. Maniar also had access to secret information related to a self-administered disposable pen injector still under development by BD and not yet available for commercial sale.
Maniar admitted he stole Bard and BD trade secrets that he kept after his resignation from those companies. Maniar downloaded numerous files containing Bard or BD product information from his work computers onto multiple computer storage devices, including external hard drives and thumb drives. He also used his work email accounts at Bard and BD to forward trade secrets to his personal email accounts.
On June 3, 2013, pursuant to court-issued federal warrants, FBI agents searched Maniar’s rental car and the New Jersey hotel room he stayed in while planning a move back to India. Agents seized – among other things – at least one hard drive containing Bard and BD trade secrets.
The theft of trade secrets charges are each punishable by a maximum potential penalty of 10 years in prison and a fine of up to $250,000. Sentencing is currently 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, for their work in the investigation of this case.
The government is represented by Assistant U.S. Attorney Shirley U. Emehelu of the U.S. Attorney’s Office’s Economic Crimes Unit in Newark.
14-193Defense counsel: Bradley L. Henry Esq. and Ryan Blanch Esq., New York
Maniar, Ketankumar Information
Former Denver Woman Pleads Guilty to Charges Related to Identity TheftRead the Press Release
DENVER - Libia Hernandez-Garcia, age 60, of Miami, Florida, formerly of Denver, Colorado, pled guilty recently before U.S. District Court Judge Christine M. Arguello tax fraud, visa fraud and social security fraud, federal authorities announced. Hernandez-Garcia, who is free on a bond, is scheduled to be sentenced by Judge Arguello on September 18, 2014. She was indicted by a federal grand jury on May 21, 2013 followed by a superseding indictment on February 25, 2014. She was arrested on February 26, 2014 in Miami, Florida.
According to the charging documents as well as the stipulated facts contained in the plea agreement, from 2009 through 2011, Hernandez-Garcia made false claims against the Internal Revenue Service which she knew to be false by preparing and filing federal income tax returns for several individuals where the claims for income tax refunds were fraudulent. Particularly, Hernandez-Garcia provided false information to a tax preparer, so refunds not belonging to her would be deposited into her own bank account.
From 2009 through 2012, Hernandez-Garcia misused the Social Security Number (SSN) of several individuals by causing the filing of individual income tax returns which falsely included the name and SSN, as a dependent, for the person identified as the filer of the tax return.
From 2008 through 2011, Hernandez-Garcia assisted in the preparation and filing with the IRS the U.S. Individual Income Tax Return of her husband for tax years 2007 through 2010 which were materially false and fraudulent. Particularly, dependents were claimed on her husband’s tax returns when in fact the dependents were not a person who could lawfully be claimed as a dependent of his. On her own personal tax returns for tax years 2006 through 2011, Hernandez-Garcia followed a similar pattern claiming dependents that could not be claimed as her dependents all in an effort to receive higher refunds.
Furthermore, on two separate occasions, one in 2008 and the second in 2011, Hernandez-Garcia made false statements under penalty of perjury in Petitions for a Nonimmigrant Worker packages. Such statements included: the beneficiary of the H-1B visa petition, Diana Aleph Aguilar Hernandez, would be employed by a local hotel operating under a national brand name as Operations Manager; Libia Hernandez was an authorized official to make such a petition on behalf of that hotel; that Libia Hernandez was authorized by that hotel to act on behalf of the company in labor certification matters.
This case was investigated by the Internal Revenue Service – Criminal Investigation, Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI), Bureau of Diplomatic Security Service (DSS), and Office of the Inspector General – Social Security Administration (SSA OIG).
This case is being prosecuted by Assistant U.S. Attorney Robert Brown.
Former Correction Officer Convicted in Manhattan Federal Court for Smuggling Marijuana into Riker’s Island in Connection with Inmate Distribution RingRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today the conviction of KHALIF PHILLIPS, a former New York City Correction Officer, in connection with his smuggling of marijuana into Riker’s Island for inmates to redistribute. Following a one-week trial, the jury convicted PHILLIPS on the second day of deliberations of each of the three counts that he faced. PHILLIPS is scheduled to be sentenced on September 25, 2014, before U.S. District Judge Richard J. Sullivan, who presided over the trial.
As alleged in the Indictment against PHILLIPS and established by the evidence admitted at trial:
PHILLIPS worked as a Correction Officer from February 2006 until his arrest in June 2013. He was assigned to the George R. Vierno Center (GRVC) on Riker’s Island. On multiple occasions in 2012, PHILLIPS smuggled marijuana into the GRVC and provided it to inmates housed in that facility, who in turn sold it to other inmates. PHILLIPS coordinated with the wives and girlfriends of his inmate co-conspirators, who met with him to supply him with marijuana and to pay him for his smuggling activities. Among the occasions where PHILLIPS brought packages of marijuana into Riker’s Island were October 8, 2012, and December 23, 2012. Typically, Phillips charged $1,000 per package that he smuggled into the GRVC.
PHILLIPS, 31, of Brooklyn, New York, was convicted of one count of conspiring to distribute and possess with intent to distribute marijuana, and two counts of distributing and possessing with intent to distribute marijuana. Each of the three counts carries a maximum term of five years in prison and a maximum fine of $250,000 or twice the gross gain or loss from the offense. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Bharara praised the outstanding investigative work of the Drug Enforcement Administration and the New York City Department of Investigation.
The prosecution is being handled by the Office’s Public Corruption Unit. Assistant United States Attorneys Russell Capone, Rahul Mukhi, and Carrie Cohen are in charge of the prosecution.
Federal Grand Jury Indicts Providence Landlord in Alleged Arson-for-Hire SchemeRead the Press Release
PROVIDENCE, R.I. – A federal grand jury returned a nine-count superseding indictment on Tuesday charging a Providence landlord with allegedly masterminding an arson-for-hire conspiracy which resulted in an occupied multi-family dwelling in Providence that he owned being damaged by fire and the collection of $8,000 in insurance payments, announced United States Attorney Peter F. Neronha; Daniel J. Kumor, Special Agent in Charge of the Boston Field Divisionof the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF); and Providence Public Safety Commissioner Steven M. Paré.
Kormahyah Karmue, 39, of, Providence, was ordered detained in federal custody following his arraignment before U.S. District Court Magistrate Judge Patricia A. Sullivan late Tuesday afternoon on charges of conspiracy to commit arson, arson, wire fraud, mail fraud and theft of U.S. government funds. A not guilty plea was entered on Karmue’s behalf.
According to the indictment, it is alleged that Karmue conspired with three others to maliciously damage and destroy by means of fire and explosion a multi-family residence he owned at 31-33 Ida Street in Providence, and that he allegedly devised a scheme in which he defrauded the Allstate Insurance Company of $8,000 in insurance payments.
Additionally, according to the indictment, it is alleged that between July 2009 and August 2011, Karmue fraudulently obtained $61,250 in federally funded unemployment insurance payments from the Rhode Island Department of Labor and Training. It is alleged that Karmue falsely represented that he was unemployed when in fact he was self-employed, engaging in the business of transporting cargo for a fee. Information pertaining to Karmue’s self-employment and alleged unemployment compensation were discovered during the investigation into the alleged arson-for-hire conspiracy.
Three co-defendants charged in this matter remain detained in federal custody. Abraham Kerkula, 20, and Nakele Freeman, 19, both of Providence, were arrested in November 2013 and have since pleaded guilty to charges of conspiracy to commit arson and arson affecting interstate commerce. They are awaiting sentencing.
Gbabia Kollie, 27, of Johnston City, Tenn., who was removed from an outbound international flight leaving Atlanta for Liberia and arrested by ATF agents on December 5, 2013, and ordered detained by the court on a criminal complaint charging him with conspiracy to commit arson and arson affecting interstate commerce, is scheduled to be arraigned on charges contained in the superseding indictment on May 29.
An indictment and a criminal complaint are merely allegations and are 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.
The cases are being prosecuted by Assistant U.S. Attorney William J. Ferland.
The investigation was conducted by ATF, the Providence Fire Department Arson Squad and the Providence Police Department Detective Bureau.
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To assist the media and the public, a glossary of federal judicial terms and procedures is available at http://www.justice.gov/usao/justice101/
Contact: 401-709-5357
[email protected]Ex-Casino Owner, Nevada Businessman and Former National Football League Player Found Guilty in Massive Tax Fraud SchemeRead the Press Release
A Las Vegas jury returned guilty verdicts yesterday against Alan Rodrigues, a former casino owner from Henderson, Nevada, Weston Coolidge, a former businessman from Las Vegas, and Joseph Prokop, a former National Football League punter from Upland, California, for conspiracy and fraud related to their promotion of a fraudulent tax product through the now-defunct National Audit Defense Network (NADN), the Justice Department and Internal Revenue Service (IRS) announced today. The guilty verdicts came after a six week trial before U.S. District Court Judge Miranda Du in the District of Nevada.
All defendants were convicted of one count of conspiracy to defraud the IRS and four counts of mail fraud. Rodrigues and Coolidge were additionally convicted of 15 counts of aiding in the preparation of false tax returns, while Prokop was convicted of 13 counts of aiding in the preparation of false tax returns. During the conspiracy, Rodrigues was NADN’s general manager, Coolidge was NADN’s owner and president and Prokop was the national marketing director of Oryan Management and Financial Services. Oryan, which was operated out of Upland, created the fraudulent tax product, called Tax Break 2000, and paid NADN a commission to sell Tax Break 2000.
“This jury verdict sends a message to those who promote fraudulent tax products like Tax Break 2000 – you do so at the risk of prosecution, prison time and substantial penalties,” said Assistant Attorney General Kathryn Keneally for the Justice Department’s Tax Division. “Prosecuting individuals who market fraudulent tax schemes has been and always will be our priority.”
According to court documents and evidence presented at trial, NADN began selling Tax Break 2000 in early 2001. Tax Break 2000 purported to be a shopping website that the defendants fraudulently said would allow customers to claim legitimate income tax credits and deductions by making the website accessible to the disabled. The defendants chose the sale price for the modifications, $10,475, solely to maximize the fraudulent income tax credits and deductions. To further the scheme, the defendants produced false IRS forms creating the appearance of fictitious commission income and prepared false tax returns on their customers’ behalf that improperly claimed the tax credits and deductions. According to evidence presented at trial, the intended tax loss based on the purported tax benefits was approximately $100 million due to the scheme.
On April 13, 2004, the department’s Tax Division filed a complaint seeking to enjoin, among others, NADN, Rodrigues, Coolidge and Prokop from selling fraudulent tax schemes, including Tax Break 2000. NADN ceased operations in May 2004, and in June 2004, a federal bankruptcy court in Las Vegas entered a permanent injunction against NADN. Prokop was also enjoined in June 2004, after consenting to entry of a permanent injunction. In April 2005, Rodrigues and Coolidge both consented to permanent injunctions.
The case was investigated by IRS - Criminal Investigation. Trial Attorneys Timothy J. Stockwell and Katherine L. Wong of the Tax Division are prosecuting the case, with litigation assistance from Larry Garland and the U.S. Attorney’s Office for the District of Nevada.
Employee of Dunbar Armored, Inc. Sentenced for Role in Armored Truck RobberiesRead the Press Release
ATLANTA – Veronica Bullard has been sentenced to three years and nine months in federal prison for her role in the commission of a series of armored truck robberies in the Atlanta area between October 2010 and March 2011.
“Bullard chose to endanger many of her co-workers’ lives as well as guards from other armored car companies,” said United States Attorney Sally Quillian Yates. “The inside information she gained in her position at Dunbar Armored, Inc., a local armored truck service, fueled a crime spree that left one man dead and another seriously injured. She thought nothing of the escalating violence in each attack. Instead, she continued to abuse her position and access to information all motivated by pure greed. Bullard deserves time in prison, and will now get it.”
J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office, stated: “This defendant’s actions were despicable and her betrayal to her employer and the courier industry as a whole led to the injury of one courier and the fatal shooting of Garda courier Gary Castillo. Today’s sentencing will not only hold Ms. Bullard accountable for those actions but will give her much opportunity to reflect on the great harm to others that those actions caused.”
According to United States Attorney Yates, the charges and other information presented in court: The defendant, Veronica Bullard, was an employee of Dunbar Armored in 2010. Bullard provided information to co-defendants Quentin Booker and Stacey Dooley about the location and amount of cash handled during Dunbar Armored cash pick-ups. This information was used them to plan and to execute multiple robberies of Dunbar Armored couriers. During the robberies, one or two gunmen would approach a courier after the courier made a cash pick-up from a location, or as the courier was about to restock an ATM machine with cash. Other members of the robbery crew would act as lookouts during the robberies, with one acting as the designated getaway driver.
The information Bullard provided to the robbers was also used to target couriers from other armored car companies. As the number of robberies escalated, so did the level of violence. In fact, during the robbery of a Loomis Armored courier who was restocking cash in an ATM machine on January 21, 2011, at a Wells Fargo Bank located in Stone Mountain, Ga., co-defendant Ashley Henderson shot and seriously injured the courier. During the robbery of a Garda Cash Logistics courier outside the Kroger Grocery Store located on LaVista Road in DeKalb County, Ga., Ashley Henderson fatally shot the courier, Gary Castillo, after Castillo made a cash pick-up of $11,000 from the store. Altogether, members of this robbing crew were responsible for six robberies involving thefts of over $470,000.
The evidence established that Bullard and her co-conspirators were specifically involved in the commission of the following robbery:
- The robbery of a Dunbar Armored courier just after he made a cash pick-up on October 7, 2010, at the Mex America Latino Services located in Marietta, Ga.
- The evidence further established that Bullard’s co-conspirators were involved in the commission of the following additional robberies:
- The robbery of a Dunbar Armored courier who was restocking cash in an ATM machine on November 11, 2010, at a Bank of America located in Buford, Ga.;
- The robbery of a Loomis Armored courier who was restocking cash in an ATM machine on November 29, 2010, at a Wells Fargo Bank located in Snellville, Ga.;
- The robbery of a Dunbar Armored courier who was heading to an ATM machine to restock it with cash inside the Mall of Georgia on December 7, 2010;
- The robbery of a Loomis Armored courier who was restocking cash in an ATM machine on January 21, 2011, at a Wells Fargo Bank located in Stone Mountain, Ga.; and
- The robbery of a Garda Cash Logistics courier on March 15, 2011, outside the Kroger Grocery Store located on LaVista Road in DeKalb County, Ga.
Bullard was sentenced to three years and nine months in federal prison, followed by three years of supervised release. She was also ordered to pay $104,694 in restitution. Bullard pleaded guilty to one count of Hobbs Act robbery (armed robbery of a Dunbar courier).
In addition to Bullard, the following defendants have also entered guilty pleas as a result of their role in the robberies:
- Ashley Henderson, 30 of Atlanta, Ga., pleaded guilty to five counts of Hobbs Act robbery (armed robbery of the couriers) and three counts of carrying and using a firearm during the commission of a violent crime. He was sentenced to 75 years in prison.
- Stacey Dooley, 37, originally from Charlotte, NC, pleaded guilty to six counts of Hobbs Act robbery and two counts of carrying and using a firearm during the commission of a violent crime. He was sentenced to 40 years in prison.
- Quentin Booker, 36, of Douglasville, Ga., pleaded guilty to five counts of Hobbs Act robbery and two counts of carrying and using a firearm during the commission of a violent crime. He was sentenced to 32 years in prison.
- Edwin Thornton, 31, of Atlanta, Ga., pleaded guilty to three counts of Hobbs Act robbery and one count of carrying and using of a firearm during the commission of a violent crime. He was sentenced to 15 years and 10 months in prison.
- Michael Johnson, 31, of Atlanta, Ga., pleaded guilty to two counts of Hobbs Act robbery and one count of carrying and using a firearm during the commission of a violent crime. He was sentenced to 15 years in prison.
- Ronnie Little, 22, of Stone Mountain, Ga., pleaded guilty to one count of Hobbs Act robbery and one count of carrying and using a firearm during the commission of a violent crime. He was sentenced to 12 years and nine months in prison.
- Desiree Jones, 29, of Snellville, Ga., pleaded guilty to two counts of unlawfully transferring a firearm knowing it would be used in a crime of violence and received a sentence of five years in federal prison.
- Derrick Powell, 26, of Atlanta, Ga., pleaded guilty to two counts of Hobbs Act robbery and one count of carrying and using a firearm during the commission of a violent crime. He is scheduled to be sentenced on June 18, 2014.
This case was investigated by the Federal Bureau of Investigation with significant assistance and resources provided by the Gwinnett Police Department. Other departments providing invaluable assistance were the Gwinnett County District Attorney's Office, the DeKalb County Police Department, the DeKalb County District Attorney's Office, the Marietta Police Department, and the Cobb County District Attorney's Office.
Assistant United States Attorneys Tracia M. King and Jill E. Steinberg are prosecuting the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia is www.justice.gov/usao/gan.
Eagle Butte Man Charged with Assault with Intent to Commit Murder and Assault by StrangulationRead the Press Release
United States Attorney Brendan V. Johnson announced that an Eagle Butte, South Dakota, man has been indicted by a federal grand jury for Assault with Intent to Commit Murder and Assault by Strangulation.
Harold Picotte, III, age 40, was indicted on May 13, 2014. He appeared before U.S. Magistrate Judge Mark A. Moreno on May 23, 2014, and pled not guilty to the Indictment.
The maximum penalty upon conviction is 20 years in custody and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that in February 2014, Picotte assaulted his dating partner/girlfriend with the intent to commit murder by strangulation and choking.
The charges are merely an accusation and Picotte is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Cheyenne River Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Mikal Hanson is prosecuting the case.
Picotte was released on bond pending trial, which is set for July 15, 2014.
Dustin C. Watson Sentenced to 115 Months for CarjackingRead the Press Release
GREENEVILLE, Tenn. – Dustin C. Watson, 31, of Knoxville, Tenn., was sentenced to serve 115 months in prison by the Honorable J. Ronnie Greer, U.S. District Judge, on May 28, 2014. Upon his release from prison Watson will be subject to supervised release under the supervision of the U.S. Probation Office for three years. There is no parole in the federal system.
In February 2014 Watson pleaded guilty to carjacking an individual in Greeneville, Tenn. Watson had requested a ride from an individual at a business on Fairgrounds Road in Greeneville on Aug. 31, 2013. While riding in the passenger seat of the vehicle, Watson threatened the driver with a knife, and ordered the driver out of the car. He then took the driver’s cell phone and vehicle, leaving the victim stranded on Highway 93 in Greene County. Watson was later arrested in Knoxville, still driving the stolen vehicle, and in possession of illegal narcotics which he had been using.
Law enforcement agencies participating in the joint investigation included the Greeneville Police Department, Knoxville Police Department and Federal Bureau of Investigation. Assistant U.S. Attorney J. Gregory Bowman represented the United States.
Dr. John Yacoub Pleads Guilty to Drug DistributionRead the Press Release
Provided Prescriptions to His Girlfriend and Others
Baltimore, Maryland – Dr. John K. Yacoub, age 58, of Baltimore, Maryland pleaded guilty today to conspiracy to distribute and possess with intent to distribute fentanyl, hydrocodone, oxycodone, morphine and methadone.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Assistant Special Agent in Charge Gary Tuggle of the Drug Enforcement Administration, Baltimore District Office; Special Agent in Charge Nicholas DiGiulio, Office of Investigations, Office of Inspector General of the Department of Health and Human Services; Chief James W. Johnson of the Baltimore County Police Department; Howard County Police Chief William McMahon; and Commissioner Anthony W. Batts of the Baltimore Police Department.“Dr. Yacoub a long standing medical doctor, not only broke the law by drug trafficking, he betrayed the trust bestowed upon him by the public,” stated Gary Tuggle, Assistant Special Agent in Charge of the Drug Enforcement Administration, Baltimore District Office. “Members of the medical community are not untouchable when they prescribe controlled substances for no legitimate reason. The abuse of diverted prescription pain medication is the fastest growing drug problem in our country and our DEA Tactical Diversion Program is ready to tackle this problem,” added Tuggle.
According to Dr. Yacoub’s plea agreement, between 2012 and 2013 he provided prescriptions and pills to his Nevada-based girlfriend, who was a drug addict. He initially provided her with Vicodin, and later with oxycodone and morphine. By 2013, Dr. Yacoub was regularly writing prescriptions for morphine and fentanyl patches, for his girlfriend’s personal use. Dr. Yacoub asked two other people (person A and person B) to help him get additional prescription medication for his girlfriend in exchange for providing them with prescriptions for methadone. Specifically, Dr. Yacoub provided person A with prescriptions for methadone in her name and the name of person B. In addition, he provided a prescription for morphine in the name of person B, who had Medicaid. Person B filled the prescription, using Medicaid to pay for the prescription, then provided the morphine to person A, who gave it either to Dr. Yacoub or to his girlfriend. Investigators have determined that Medicaid paid $2,375.92 for morphine prescriptions obtained by person B for Dr. Yacoub.During a search warrant executed on September 23, 2013, investigators obtained patient files for Dr. Yacoub’s girlfriend, person A and person B. None of their files reflected any medical treatment or medical reason for the medications prescribed to them by Dr. Yacoub. Dr. Yacoub admitted that providing the prescriptions to his girlfriend, person A and person B was not within the scope of accepted medical practice.
Dr. Yacoub faces a maximum sentence of 20 years in prison. U.S. District Judge Catherine C. Blake scheduled sentencing for September 23, 2014 at 9:00 a.m.
United States Attorney Rod J. Rosenstein praised the DEA, HHS – Office of Inspector General, Baltimore County and Howard County Police Departments and the Baltimore Police Department for their work in the investigation. Mr. Rosenstein also recognized the Maryland Board of Physicians for its assistance. Mr. Rosenstein thanked Assistant U.S. Attorney Kenneth S. Clark, who is prosecuting the case.District of South Dakota Issues 2013 Annual ReportRead the Press Release
United States Attorney Brendan V. Johnson announced the release of the 2013 Annual Report for the District of South Dakota. Despite federal budget cuts and staff reductions due to sequestration, significant accomplishments were achieved in 2013.
Human trafficking continues to be an area of high priority, and the report highlights several successful prosecutions. In 2013, many of the office’s most heinous sex trafficking cases were closed, with one defendant being sentenced to three life sentences. Three more defendants received sentences of 33½ years, 30 years, and 10 years. Also in 2013, 11 more people were indicted on sex trafficking and related charges, and others were convicted and scheduled for sentencing. The success recognized in 2013 is due in large part to the tremendous collaboration and support of federal, state, local, and tribal law enforcement partners who investigate the leads and help build the cases against these perpetrators.
In addition, the report highlights the achievements in other high priority areas, such as ongoing initiatives to make tribal communities safer, enhanced community outreach efforts, progress in the areas of victim’s rights and advocacy, and an overview of the work performed by the Civil and Appellate Divisions.
The complete report is available on-line at the Department of Justice website: http://www.justice.gov/usao/sd/docs/Annual_Report_2013.pdf
Department of Justice Announces 48 States and Territories Have Committed to Ending Prison RapeRead the Press Release
Deputy Attorney General James M. Cole and Principal Deputy Assistant Attorney General for Justice Programs Mary Lou Leary announced today that the vast majority of U.S. states and territories have informed the Department of Justice that they intend to take steps to reduce sexual assaults in prisons, in accordance with federal law.
Under the Prison Rape Elimination Act (PREA), which was passed in 2003 with unanimous support from both parties of Congress, Fiscal Year 2014 is the first year that states and territories may have certain federal grant funds withheld unless they demonstrate an intention to comply with the law. Of the 56 jurisdictions that are subject to PREA – the 50 states, the 5 territories and the District of Columbia – 48 are in compliance or have submitted assurances to the department committing to spending five percent of certain federal grant funds to come into compliance. This translates to a compliance rate of 85 percent.
“No one should be subjected to sexual abuse while in the custody of our justice system,” said Deputy Attorney General Cole. “It serves as a violation of fundamental rights, an attack on human dignity and runs contrary to everything we stand for as a nation. Based on these certifications and assurances, and other correspondence submitted by the governors, it is clear that addressing the issue of sexual abuse in confinement facilities is a high nationwide priority.”
“We are witnessing a major change in the culture of our nation's criminal justice systems. The discussion is no longer whether sexual victimization in correctional facilities is a problem, or even where the problem might be most serious,” said Principal Deputy Assistant Attorney General Leary. “An overwhelming majority of states and territories has committed to preventing, identifying and addressing this serious travesty against human dignity anywhere it occurs.”
An estimated four percent of state and federal prison inmates and just over three percent of jail inmates reported experiencing one or more incidents of sexual victimization by another inmate or a facility staff member within the previous 12 months. Among youth in state juvenile facilities and state contract facilities that rate increases to an estimated nine and a half percent in the previous 12 months. The National PREA Standards create policies and practices to ensure a zero tolerance for sexual assault in prisons and corrections facilities by preventing, detecting and responding to sexual abuse.
Two states, New Hampshire and New Jersey, have certified that they are in full compliance with PREA. Understanding that the standards could take a number of years to fully implement, the statute allows a governor whose state or territory is not yet in full compliance to submit an assurance to the department that not less than five percent of certain department grant funds will be used solely for the purpose of enabling the state or territory to achieve and certify full compliance with the standards in future years. This year 46 jurisdictions submitted an assurance. The eight states or territories that are unwilling to commit the five percent of federal grant funds to implementation of the National PREA Standards are subject to the loss of five percent of certain department grant funds that they would otherwise receive.
The submitted assurances by governors or heads of territories is required by the PREA statute. The PREA standards took effect on Aug. 20, 2012. The standards apply to Justice Department, state, and local confinement facilities, including adult prisons and jails, juvenile facilities, police lockups, and community corrections facilities. The standards reflect careful consideration of all public input, including over 2,000 public comments, as well as detailed analysis of anticipated benefits and costs, in light of PREA’s requirement that the standards not “impose substantial additional costs compared to the costs presently expended by federal, state and local prison authorities.”
To assist states and localities with the implementation of the National PREA Standards, the department, through the Bureau of Justice Assistance, funded the National PREA Resource Center which provides training and technical assistance, as well as serving as a single-stop resource for leading research and tools for all those in the field working to implement the National PREA Standards. The department has also funded over $23 million in grants to support state and local jurisdictions in creating zero-tolerance cultures for sexual abuse in confinement facilities. For more information on the National PREA Standards as well and what assistance is available to states visit www.prearesourcecenter.org.
Denton County Man and Woman Sentenced for Federal Income Tax ViolationsRead the Press Release
Department of Justice
Office of Public AffairsSHERMAN, Texas - A Denton County, Texas man and woman have been sentenced to federal prison for income tax violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Michael Jerome Edwards, 40, and Cheri Joann Edwards, 38, both of Lewisville, Texas, pleaded guilty on Oct. 28, 2013 to conspiracy to defraud the government. Cheri Edwards was sentenced to eight months in federal prison and ordered to pay restitution in the amount of $67,574.83 today by U.S. District Judge Thad Heartfield.
Michael Edwards was sentenced to 46 months in federal prison and ordered to pay restitution of $419,739.00 on Apr. 22, 2014 by Judge Heartfield.
According to information presented in court, beginning in November 2008, Michael and Cheri Edwards devised a scheme to defraud the government by submitting fraudulent federal income tax returns claiming $3,860,722.00 in refunds for tax years 2006 through 2008, which far exceeded that to which they were entitled. To facilitate the scheme, the defendant’s submitted Form 1099-Original Issue Discount (OID) to falsely identify federal income tax withholdings. As a result of this fraudulent activity, Michael Edwards received a federal tax refund in February 2009 in the amount of $324,536.84 for the 2007 tax year. In April 2009, Cheri Edwards received a federal tax refund in the amount of $77,451.00 for tax year 2008. The defendants were indicted by a federal grand jury on Sep. 12, 2012.
This case was investigated by IRS Criminal Investigations and prosecuted by Assistant U.S. Attorney Christopher A. Eason.
#######Deirdre M. Daly Sworn in as United States AttorneyRead the Press Release
Follow @USAO_CT
Deirdre M. Daly, 54, of Fairfield, was sworn in today as the United States Attorney for the District of Connecticut by the Honorable Janet C. Hall, Chief Judge for the District, in New Haven. President Barack Obama nominated Ms. Daly to serve as U.S. Attorney on March 13, 2014, and the U.S. Senate confirmed her nomination on May 21, 2014. This marks the first time a woman has been nominated by a President and confirmed by the Senate to be the U.S. Attorney for Connecticut.
“I am grateful to those who supported my nomination and deeply appreciate the opportunity to serve in this position,” stated Ms. Daly. “I very much look forward to continuing to work with the dedicated and talented people in our Office as well as our many law enforcement partners throughout the State.”
Ms. Daly served as the United States Attorney in an acting or interim capacity since May 14, 2013, following the resignation of her predecessor, David B. Fein. Between July 2010 and May 2013, she was the First Assistant U.S. Attorney during which time she assisted in the oversight of both the Criminal and Civil Divisions. In March 2013, Ms. Daly led the prosecution of Hector Natal, who was convicted after trial of setting fire to a house in New Haven that resulted in the death of two women and a young boy.
From 1985 to 1997, Ms. Daly was an Assistant U.S. Attorney in the Southern District of New York, where she prosecuted a wide range of cases from racketeering and murder to corruption and fraud, and later served as the Assistant-In-Charge of White Plains Office for three years. After leaving the Department of Justice, Ms. Daly was a partner at Daly & Pavlis LLC, a Connecticut law firm with a practice focused on corporate and commercial litigation, white-collar criminal investigations, SEC enforcement actions and corporate internal investigations and monitoring.
A graduate of Dartmouth College and Georgetown University Law Center, earlier in her career, Ms. Daly served as a law clerk for the Honorable Lloyd F. MacMahon, U.S. District Judge for the Southern District of New York.
The U.S. Attorney’s Office is charged with enforcing federal criminal laws in Connecticut, and with representing the federal government in civil litigation in the District. As U.S. Attorney, Ms. Daly supervises a staff of approximately 64 Assistant U.S. Attorneys and 60 staff members at offices in New Haven, Hartford and Bridgeport.
Ms. Daly is the 51st United States Attorney for the District of Connecticut, an office that was established in 1789.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Corrections Officers, Lawyer, Among Nine Charged in Schemes to Smuggle Contraband into Federal Pretrial Detention FacilityRead the Press Release
NEWARK, N.J. – Two corrections officers, a lawyer, and six others were charged today in three separate complaints with smuggling contraband, including cell phones and marijuana, into a federal pretrial detention facility at the Essex County Correctional Facility, U.S. Attorney Paul J. Fishman announced.
Corrections officer Stephon Solomon, 26, of Irvington, N.J.; Darsell Davis, 28, Dwayne Harper, 30, and Deidra Harrison, 49, all of Newark; attorney Brian Kapalin, 66, of Maplewood, N.J.; and Vladimir Sauzereseteo, 40, of East Orange, N.J., were arrested this morning by special agents of the FBI. Corrections officer Channel Lespinasse, 25, of Florham Park, N.J., was issued a summons. Quasim Nichols, 29, and Muhammad Subpunallah, 32, already are incarcerated on unrelated federal charges.
“According to the complaints, the defendants operated contraband marketplace within the walls of the Essex County Correctional Facility,” said U.S. Attorney Fishman. “Jails are no place for drugs and illicit phones, and it is disappointing that two corrections officers and an attorney allegedly used their authority and access to make them available.”
“The allegations in today’s complaints underscore the commitment of the FBI and the Department of Justice to continue to pursue those employed by the government who undermine the public’s trust and engage in unethical and corrupt practices,” said Special Agent in Charge Ford. “The FBI and our law enforcement partners are determined to address public corruption at all levels of government.”
Solomon, Davis, Harper, Harrison, Kapalin, Sauzereseteo, Nichols and Subpunallah are scheduled to make their initial appearances this afternoon before U.S. Magistrate Judge James B. Clark III in Newark federal court. Lespinasse will appear for her initial appearance on June 2, 2014, before U.S. Magistrate Judge Michael A. Hammer in Newark.
According to the complaints unsealed today:
On at least five occasions between October 2013 and April 2014, Solomon, a corrections officer at the Essex County Correctional Facility, smuggled contraband – including cell phones, tobacco, and marijuana – to Nichols, an inmate there, in exchange for cash bribes. Nichols’ friends, Davis and Harper, helped by collecting the items that were to be smuggled into the jail. Davis then handed off the contraband and cash payments to Solomon. Nichols ultimately sold some of the marijuana and cell phones he received from Solomon to other inmates. The inmates purchasing marijuana and cell phones from Nichols had their friends and family pay for the items by sending Western Union money transfers to Nichols, who then enlisted Davis and others to retrieve the payments. Nichols also used the cell phones he received through this smuggling scheme to communicate with his conspirators.
Lespinasse, another corrections officer at the Essex County Correctional Facility, also smuggled in contraband in exchange for a cash bribe. In November 2013, Lespinasse and an associate, Harrison, agreed to smuggle a cell phone to an inmate in the jail in exchange for a cash bribe. On behalf of Lespinasse, Harrison accepted a $1,000 cash bribe and a cell phone from an undercover agent in the parking lot of a McDonald’s restaurant in Newark. Harrison promised the undercover federal agent that the cell phone would be delivered to its recipient – an inmate in the jail. Three days later, Lespinasse delivered the cell phone to the inmate.
Kapalin, a lawyer who practiced in New Jersey, used his access to inmates at the Essex County Correctional Facility to smuggle in contraband – including marijuana and tobacco – to inmates, including Subpunallah, in exchange for cash payments. Sauzereseteo, an associate of Subpunallah, delivered the contraband and the cash payments to Kapalin, who then smuggled the contraband into the jail. In January 2014, Kapalin spoke with Subpunallah – at that point an inmate at the Hudson County Correctional Facility – over a recorded jail phone. Subpunallah asked Kapalin to deliver contraband to an inmate at the Essex County Correctional Facility. Sauzereseteo was paid $1,650, via Western Union money transfers, which he used to purchase marijuana he delivered to Kapalin, along with a cash payment. A few days later, Kapalin met an inmate from the Essex County Correctional Facility in the attorney conference room at the jail, during which time he delivered the marijuana to the inmate.
A search of the federal pods at the Essex County Correctional Facility on May 26, 2014, produced nine hidden cellular phones, including one in the light fixture in the ceiling of Nichols’ cell.
The criminal complaints charge Solomon, Nichols, Davis, Harper, Lespinasse and Harrison each with one count of conspiring to violate the Hobbs Act, punishable by a maximum potential penalty of 20 years in prison and a maximum fine of the greatest of $250,000 or twice the gain or loss from the offense. The criminal complaints charge all nine defendants with one count of conspiring to provide contraband to inmates at the jail, a count that carries a maximum potential penalty of five years in prison and a $250,000 fine for smuggling marijuana or one year in prison and $100,000 maximum fine for smuggling a cell phone.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark, and the Internal Affairs Division of Essex County Correctional Facility, under the leadership of Warden Roy Hendricks, with the ongoing investigation leading to today’s arrests.
The government is represented by Assistant U.S. Attorneys Rahul Agarwal of the U.S. Attorney’s Office Special Prosecutions Division and Rob Frazer of the Criminal Division, Organized Crime/Gangs Unit, in Newark.
14-192Solomon, Stephon et al. Complaint
Lespinasse, Channel et al. Complaint
Kapalin, Brian et al. ComplaintConnecticut Man Who Used Offshore Accounts Sentenced to Prison for Tax Evasion and ConspiracyRead the Press Release
John Cote, formerly of Danielson, Connecticut, was sentenced today to serve 46 months in prison by U.S. District Judge Vanessa Bryant, the Justice Department and the Internal Revenue Service (IRS) announced. Cote was convicted in January 2014 of four counts of tax evasion along with conspiracy to defraud the IRS following a jury trial in the U.S. District Court for the District of Connecticut sitting in Hartford. Cote was also ordered to pay restitution of $222,691 and to serve three years of supervised release following his release from prison.
According to court documents and evidence produced at trial, Cote did not file a timely or valid tax return for the years 1995 through 2009, despite earning income from his work as a consultant in the high-technology welding industry. The evidence introduced at trial showed that Cote and his wife responded to IRS efforts to assess and collect taxes by concealing income and assets from the government, and by submitting obstructive letters and other documents, including false criminal complaints against IRS employees. Starting in 1998, Cote caused the companies for which he worked to pay his compensation to nominee entities, sometimes through accounts in Costa Rica and Sweden. Cote also used a nominee entity in his wife’s name to conceal income and assets from the IRS and in 2003, Cote's wife conveyed their personal residence to this entity.
The case was investigated by special agents of IRS – Criminal Investigation. Trial Attorneys Jennifer Laraia, Melissa Siskind and Jeffrey McLellan of the Tax Division prosecuted the case. Assistant Attorney General Kathryn Keneally of the Tax Division commended the special agents and the prosecutors, and thanked U.S. Attorney Deirdre M. Daly for the District of Connecticut and her office for their assistance.
Coal City Man Pleads Guilty to Distributing OxycodoneRead the Press Release
BECKLEY, W.Va. – United States Attorney Booth Goodwin announced today that Harry D. Rhodes, Jr., 49, of Coal City, West Virginia, plead guilty in federal court in Beckley to distributing oxycodone, a powerful and addictive prescription pain medication. Rhodes admitted that in December of 2013, he sold oxycodone pills to a person who was cooperating with law enforcement authorities. The drug deal took place in Coal City, near Beckley, West Virginia.
Rhodes faces up to 20 years in prison and a $1,000,000 fine. United States District Judge Irene C. Berger scheduled the sentencing for September 10, 2014.
The Beckley/Raleigh County Drug and Violent Crime Unit conducted the investigation.This case was prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs and heroin. The United States Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers and heroin in communities across the Southern District.
Chicago Man Indicted on Federal Charges for Allegedly Illegally Trafficking and Possessing Dozens of FirearmsRead the Press Release
CHICAGO ― A Chicago man is facing federal gun charges for allegedly illegally trafficking nearly 40 firearms and illegally possessing at least 11 firearms between 2010 and 2012. The defendant, EARL GARDNER, was arrested last night by Chicago Police officers on a federal warrant issued after he was indicted last Wednesday by a federal grand jury.
Gardner, 25, of the 5900 block of South Bishop Street, was charged with one count of dealing firearms without a federal license and four counts of being a convicted felon in possession of firearms.
He pleaded not guilty today at his arraignment before U.S. Magistrate Judge Mary Rowland and was ordered to remain in custody pending a detention hearing at 1:30 p.m. Friday in U.S. District Court.
According to the indictment and a prosecutor’s statements in court today, Gardner engaged in the business of dealing 39 firearms without a federal license between Dec. 29, 2010, and June 7, 2012, when he sold the guns to a cooperating individual. Those 39 firearms included more than a dozen semi-automatic pistols, 10 revolvers, 10 rifles, three shotguns, and two TEC-9 9 mm pistols. On Sept. 19 and 22, 2011, and Jan. 21 and Feb. 9, 2012, Gardner allegedly illegally possessed two or more firearms on each date after having been convicted of a felony, which disqualified him from possessing a gun. Among the 11 firearms that Gardner allegedly possessed were various 9 mm and .22, .38, and .45 caliber pistols, as well as several rifles, including two Norinco Model SKS 7.62 x 39 mm rifles.
Dealing firearms without a federal license carries a maximum sentence of five years in prison, while each count of being a felon-in-possession of firearms carries a maximum of 10 years in prison, and all five counts carry a $250,000 maximum fine. If convicted, the court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines.
The arrest and charges were announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Carl Vasilko, Special Agent-in-Charge of the Chicago Office of the Bureau of Alcohol, Tobacco, Firearms, and Explosives; and Chicago Police Superintendent Garry McCarthy. The government is being represented by Assistant U.S. Attorney Timothy Chapman.
The public is reminded that an indictment is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Indictment
Chataignier Man Sentenced to 135 Months in Prison for Possessing Child PornographyRead the Press Release
LAFAYETTE, La. – United States Attorney Stephanie A. Finley announced that Ricky Johnson, 53, of Chataignier, La., was sentenced on Tuesday by U.S. District Judge Richard T. Haik, to 135 months in prison and a lifetime of supervised release for possession of child pornography. He was also ordered to forfeit the devices used in the crime.
According to evidence presented at the guilty plea on February 5, 2014, the investigation revealed that Johnson was downloading child pornography from a file sharing network online in early 2010. In September of 2010, Johnson’s computer and other electronic devices were searched, and images and videos of child pornography were found. Johnson has a prior conviction for molestation of a juvenile.
The FBI conducted the investigation. Assistant U.S. Attorney Daniel J. McCoy prosecuted the case. This case is part of Project Safe Childhood, a U.S. Department of Justice nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Those concerned may also leave tips with the FBI at tips.fbi.gov. Tips may be submitted anonymously. The Lafayette FBI office number is (337) 233-2164.
California Woman Sentenced on Drug ChargeRead the Press Release
BUFFALO, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that Myra Hight, 52, of Lake Tahoe, CA, who was convicted of marijuana conspiracy, was sentenced to time served and three years supervised release by Chief U.S. District Judge William M. Skretny.
Assistant U.S. Attorney John M. Alsup, who handling the case, stated that the defendant was arrested on February 20, 2012 by Hamburg Police in the parking lot of a store in the Town of Hamburg. During a search of the car Hight was driving, officers recovered $77,000 in U.S. currency, money the defendant admitted was proceeds of her marijuana trafficking conspiracy.
The sentencing is the culmination of an investigation by the Hamburg Police Department, under the direction of Chief Michael Williams and the Drug Enforcement Administration, under the direction of Acting Special Agent in Charge James J. Hunt, New York Field Division.