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Friday 9 May 2014
Sacramento Men Indicted in Three Federal Cases for Drug and Firearm OffensesRead the Press Release
SACRAMENTO, Calif. — Thanks to the efforts of federal and local law enforcement working together, over the course of the past week three federal indictments have been brought against Sacramento defendants Jose Manuel Hernandez, Michael Rojas Jr., and Gabriel Reyes Hernandez, charging each of them with illegal possession of firearms. This announcement was made by United States Attorney Benjamin B. Wagner, Bureau of Alcohol, Tobacco, Firearms and Explosives, Special Agent in Charge Joseph M. Riehl, and Sacramento Police Chief Sam Somers.
The Project Safe Neighborhoods initiative (PSN) brings together federal, state and local law enforcement to combat gun and gang crime. At the core of PSN is increased federal prosecution to incapacitate chronic violent offenders as well as to communicate a credible deterrent threat to potential gun offenders.
Jose Manuel Hernandez, 30, was charged with possessing a firearm after previously being convicted of a felony, and in addition with possessing with intent to distribute methamphetamine, cultivating marijuana, and possessing with intent to distribute marijuana.(Docket # 2:14-cr-122 JAM) Michael Rojas Jr., 24, was charged with being a felon in possession of a firearm. (Docket # 2:14-cr-134 JAM) Gabriel Reyes Hernandez, 27, was charged with being a felon in possession of a .40 caliber Glock 23 pistol with an obliterated serial number. (Docket # 2:14-cr-129 JAM)
These cases are the product of investigations by the Sacramento Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant United States Attorneys Michael McCoy and Justin Lee are prosecuting the cases.
If convicted on the firearm offenses, each defendant faces a maximum statutory penalty of 10 years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Rochester Woman Pleads Guilty to Tax FraudRead the Press Release
ROCHESTER, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that Kenyatta Hubbard, 33, of Rochester, N.Y., pleaded guilty to conspiring to defraud the United States before U.S. District Judge David G. Larimer. The charge carries a maximum sentence 10 years in prison, a fine of $853,766, or both.
Assistant U.S. Attorney John J. Field, who is handling the case, stated that from 2010 to 2012, Hubbard worked at McFarland Tax Company preparing income tax returns. The defendant conspired with the owner of the business to prepare false income tax returns for clients. The scheme involved reporting fictitious employment in order to increase the Earned Income Tax Credit refunds claimed on behalf of the clients. As a result of the scheme, the United States was defrauded into paying tax refunds totaling $426,883.
The plea is the culmination of an investigation by Special Agents of the Internal Revenue Service, Criminal Investigation Division, under the direction of Shantelle P. Kitchen, Acting Special Agent in Charge, New York Field Office.
Sentencing is scheduled for August 12, 2014, at 10:30 a.m. before Judge Larimer.Rochester Man Sentenced for Selling Counterfeit GoodsRead the Press Release
BUFFALO, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that Carmelo Gimeli, 67, of Rochester, N.Y., who was convicted of trafficking in counterfeit goods, was sentenced to 24 months supervised release to include four months of electronic monitoring, by Chief U.S. District Court Judge William M. Skretny.
Assistant U.S. Attorney Carol G. Bridge, who handled the case, stated that the defendant sold large quantities of counterfeit merchandise at the Walden Super Flea. During the execution of a search warrant, law enforcement officers seized more than 650 counterfeit purses, wallets, shoes and boots being sold under such names as Ugg, Michael Kors and Coach.
The sentencing is the culmination of an investigation on the part of Special Agents of Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent in Charge James C. Spero.Physical Therapist Facing Additional Health Care Fraud and Tax Fraud ChargesRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that DANIELLE FAUX, 46, of Weston, has been charged in a 54-count superseding indictment with federal health care fraud and income tax fraud offenses. The superseding indictment was returned by a grand jury in Bridgeport on April 16, 2014, and FAUX appeared today before U.S. Magistrate Judge Holly B. Fitzsimmons in Bridgeport and entered a plea of not guilty to the charges.
According to the superseding indictment, FAUX owned and operated Danielle Faux PT, LLC, a physical therapy clinic located at 27 Lois Street in Norwalk, and was a part owner of Achieve Rehab and Fitness, a gym located at the same address in Norwalk. The indictment alleges that FAUX engaged in a scheme to defraud Medicare, Anthem Blue Cross Blue Shield, and Aetna by referring some of her patients for personal training sessions at Achieve Rehab and Fitness and then billing the sessions as if they were physical therapy procedures. The indictment also alleges that FAUX created and altered patient records when Medicare audited her practice in August 2009, and that she made false statements on her 2008, 2009, and 2010 federal income tax returns.
FAUX was arrested on February 24, 2014, based on an indictment charging her with 46 counts of health care fraud and one count of obstruction of a federal audit. The superseding indictment includes four additional counts of health care fraud and three counts of making a false statement on a federal income tax return.
If convicted, FAUX faces a maximum term of imprisonment of 10 years and a fine of up to $250,000 on each of the health care fraud counts, a maximum term of imprisonment of five years and a fine of $250,000 on the obstruction count, and a maximum term of three years and a fine of $100,000 on each of the tax counts.
The case has been assigned to Senior U.S. District Judge Warren W. Eginton in Bridgeport, who has scheduled trial for October.
FAUX is released on a $50,000 bond.
U.S. Attorney Daly stressed that an indictment is not evidence of guilt. Charges are only allegations, and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This matter is being investigated by the Federal Bureau of Investigation, the Office of the Inspector General of the U.S. Department of Health and Human Services, and the Internal Revenue Service – Criminal Investigation. The case is being prosecuted by Assistant U.S. Attorney David J. Sheldon.
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Tom Carson
(203) 821-3722
[email protected]Pennsylvania Realtor Charged with Defrauding ClientsRead the Press Release
Joseph N. Reilly, 69 of Philadelphia, Pennsylvania, was charged today by information with mail fraud, announced United States Attorney Zane David Memeger. According to the information, Reilly, who owned Joseph N. Reilly Real Estate, Inc., diverted more than $1 million in client funds to himself, between January 2009 and April 2011, defrauding approximately 50 clients.
Reilly, through his company, acted as a property manager for his clients, collecting rent and utilities payments for owners. He also paid utility and real estate tax bills. Reilly mailed monthly statements to tenants and property owners. According to the information, Reilly sent at least one statement to a property owner indicating that the balance in the owner’s account was $490,565.58 when, in fact, the balance was $86.80.
If convicted the defendant faces a maximum possible sentence of 20 years in prison, a fine of up to $250,000, three years of supervised release, and a $100 special assessment.
The case was investigated by the U.S. Postal Inspection Service and is being prosecuted by Assistant United States Attorney Judy G. Smith.
Click here to view the indictment
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Pair Indicted for Operating Advance Fee Loan SchemeRead the Press Release
BOSTON – A Florida woman and a man who previously resided in Beverly were charged in an indictment unsealed today in connection with an advance fee scheme involving approximately 100 victims throughout the United States, including many in Massachusetts.
Ann Elizabeth Ursiny, a/k/a Ann Stone, 50, and Robert E. O’Connor, 63, were indicted on 19 counts of mail fraud and 17 counts of wire fraud.
The indictment alleges that between early 2010 and 2011, Ursiny recruited agents, including O’Connor, in several states to solicit individuals to apply for loans through her entity Trace Financial Group, Inc. (Trace) and to pay the advance fees. The agents, including O’Connor, were paid a portion of those advance fees. O’Connor and Ursiny told prospective applicants that Trace had successfully processed and disbursed many loans, when in fact none were ever disbursed. Ursiny and O’Connor focused their scheme on prospective applicants who had poor credit or whose homes were underwater, and represented that Trace could replace their mortgage with a new, smaller mortgage with lower mortgage interest payments. The indictment alleges that Trace never funded any of the loans, and failed to pay refunds as promised. Victims’ funds were used primarily for Ursiny’s personal and family expenses, as well as to pay “commissions” to agents.
If convicted, Ursiny and O’Connor each face a statutory maximum sentence of 20 years in prison, three years of supervised release, and a $250,000 fine on each count.
United States Attorney Carmen M. Ortiz and Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division, made the announcement today. The case is being prosecuted by Mark J. Balthazard of Ortiz’s Economic Crimes Unit.
The details contained in the indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Owners of TelexFree Charged in $1 Billion Pyramid SchemeRead the Press Release
BOSTON – James M. Merrill and Carlos N. Wanzeler, principals of TelexFree, Incorporated and related entities, were charged today in a federal criminal complaint, charging them with conspiracy to commit wire fraud.
Merrill, 53, of Ashland, Mass. and Wanzeler, 45, of Northborough, Mass., were charged in a one count criminal complaint filed in U.S. District Court in Worcester, Mass. If convicted, each face up to 20 years in prison. Merrill was arrested today by federal authorities and made an initial appearance in U.S. District Court in Worcester. A federal arrest warrant was issued for Wanzeler who is a fugitive.
United States Attorney Carmen Ortiz said, “The scope of this alleged fraud is breathtaking. As alleged, these defendants devised a scheme which reaped hundreds of millions of dollars from hard working people around the globe.”
“I am very proud of the tireless efforts of my special agents. Investigating the flow of illicit money across U.S. borders and the criminal enterprises behind that money is one of our top priorities,” said Bruce Foucart, Special Agent in Charge of Homeland Security Investigations. “While pyramid schemes are nothing new, the potential scope of this case will hopefully serve as an educational lesson for all. The main point is clear; if it sounds too good to be true, it probably is.”
According to the complaint affidavit, TelexFree, Inc., and TelexFree LLC (collectively, “TelexFree”) provided “voice-over-internet-protocol” (“VOIP”) telephone services, for which customers can sign up via a web site maintained by TelexFree. It is alleged that TelexFree was actually a pyramid scheme and that between January 2012 and March 2014, TelexFree purported to aggressively market its VOIP service by recruiting thousands of “promoters” to post ads for the product on the Internet. Each promoter was required to “buy in” to TelexFree at a certain price, after which they were compensated by TelexFree, under a complex compensation structure, on a weekly basis so long as they posted ads for TelexFree’s VOIP service on the Internet.
It is alleged that the ad-posting requirements were a meaningless exercise, in which promoters cut and pasted ads into various classified ad sites provided by TelexFree which were already saturated with ads posted by earlier participants. According to the affidavit, TelexFree derived only a fraction of its revenue from sales of VOIP service – less than 1% of TelexFree’s hundreds of millions of dollars in revenue over the last two years. The overwhelming majority of its revenue – the other roughly 99% – came from new people buying into the scheme. TelexFree was allegedly only able to pay the returns it had promised to its existing promoters by bringing in money from newly-recruited promoters.
On or about March 8, 2014, TelexFree announced changes to its compensation system. On April 14, 2014, Telexfree filed for bankruptcy. In its filings with the bankruptcy court, Telexfree stated, among other things, that it changed its compensation plan “because questions were raised” about the prior plan and that, after changing the plan, the “discretionary payments ... quickly became a substantial drain on the Company’s liquidity.”
On April 16, 2014, the Securities and Exchange Commission obtained a restraining order to freeze assets of Telexfree and eight related individuals. Since then, the U.S. Attorney’s Office has executed 37 seizure warrants for assets in the tens of millions of dollars.
It is further alleged that in 2013, TelexFree reported sales of $1.016 billion, while known sales of the TelexFree VOIP product represented less than 0.1% percent of TelexFree’s total revenues.
United States Attorney Ortiz, SAC Foucart and Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division, made the announcement today. The case is being prosecuted by Assistant U.S. Attorneys Cory Flashner and Andrew Lelling of Ortiz’s Worcester Branch Office and Economic Crimes Unit, respectively.
If you believe that you are a victim of the alleged TelexFree, Inc. scheme, please send your contact information to the following address: [email protected]The details contained in the complaint affidavit are allegations. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Oelwein Felon Sentenced to More Than Five Years' Imprisonment for Possession of Stolen HandgunsRead the Press Release
A convicted felon who was found in possession of two stolen handguns was sentenced today to more than five years in federal prison. Michael Rohrick, age 28, from Oelwein, Iowa, received the prison term after a February 24, 2014, guilty plea to one count of being a felon in possession of a firearm and ammunition.
In a plea agreement, Rohrick admitted that on November 1, 2013, when law enforcement officers searched his house while trying to arrest him for an outstanding warrant for distributing drugs, the officers found a stolen, loaded 9mm handgun, a scale, empty baggies, baggies containing marijuana, and drug use paraphernalia. Three days later officers surrounded Rohrick in a cornfield. While speaking with him in an attempt to get him to surrender to officers, he reported that he had another handgun hidden in his house. Officers again searched his house and found a stolen .327 caliber revolver hidden in a vent. Rohrick was prohibited from possessing firearms because he was a convicted felon, having been convicted in 2009 in the Iowa District Court for Fayette County of burglary.
Rohrick was sentenced in Cedar Rapids by United States District Court Chief Judge Linda R. Reade. Rohrick was sentenced to 71 months’ imprisonment. The court based the sentence, in part, upon Rohrick’s serious criminal history, which included multiple burglary convictions, and because he possessed the stolen handguns in connection with drug trafficking. A special assessment of $100 was imposed. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system. Rohrick is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney C.J. Williams and was investigated by the Oelwein Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 14-cr-2002.
Norfolk Woman Sentenced for Conspiring to Distribute MethamphetamineRead the Press Release
NORFOLK, Va. – Linda Marie Delarosa, 31, of Norfolk, Va., was sentenced today to 240 months in prison for conspiracy to distribute and possess with intent to distribute 500 grams or more of methamphetamine.
Dana J. Boente, United States Attorney for the Eastern District of Virginia, and Acting Special Agent in Charge Katrina W. Berger, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Washington, made the announcement after sentencing by Chief United States District Judge Rebecca Beach Smith.
Delarosa pleaded guilty to the conspiracy charge on December 17, 2013. According to the statement of facts filed with her plea agreement, beginning in 2012, Delarosa, an Asheville, NC area based methamphetamine supplier, conspired with others to transport methamphetamine to the Eastern District of Virginia. Delarosa later moved to Norfolk, Virginia, but continued to transport methamphetamine from the Asheville, NC area for repackaging and distributing in the Eastern District of Virginia. Delarosa distributed large quantities of methamphetamine to various conspirators until August of 2013.
This case was investigated by Homeland Security Investigations and the Virginia Beach Police Department. Assistant United States Attorney Darryl Mitchell prosecuted the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Nine Trey Gang Leader Sentenced to 40 Years in Prison, Enforcer Sentenced to 30 Years for Multiple Racketeering OffensesRead the Press Release
Gang members engaged in sex trafficking, robberies, drug distribution and violent crimes
ALEXANDRIA, Va. – Thaddaeus Snow, a/k/a “Storm,” 34, of Manassas, Va., was sentenced today to 40 years in prison, followed by five years of supervised release and registration as a sex offender. William Sykes, a/k/a “Black,” 29, of Bealeton, Va., was sentenced to 30 years in prison, five years of supervised release and registration as a sex offender.
Both men were convicted on Feb. 21, 2014, by a federal jury of charges that included conspiracy to commit racketeering, violence in aid of racketeering, robbery, conspiracy to distribute cocaine base, conspiracy to commit sex trafficking by force and coercion and multiple firearms offenses.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office; and Colonel Edwin C. Roessler, Jr., Fairfax County Chief of Police, made the announcement after sentencing by U.S. District Judge Leonie M. Brinkema.
“These defendants and their fellow gang members threatened the safety of our communities by committing acts of violence, dealing drugs, and dehumanizing women through prostitution by force and coercion,” said U.S. Attorney Boente. “I want to commend our federal, state and local law enforcement partners for their commitment to dismantling this dangerous gang and combatting these pernicious crimes.”
“The sentences handed down today send a clear message to members of these violent criminal enterprises: we will not tolerate your illegal activities,” said Assistant Director in Charge Parlave. “The FBI, through the Northern Virginia Gang Task Force and our partners in local law enforcement, will continue to systematically target, investigate and prosecute gang members who use violence to threaten our communities.”
Snow and Sykes were indicted by a federal grand jury on Sept. 26, 2013, along with twenty-two other members and associates of the Nine Trey Gangsters street gang, on charges of conspiracy to commit racketeering, violence in aid of racketeering, conspiracy to commit sex trafficking, conspiracy to commit robbery, conspiracy to distribute 280 grams or more of crack cocaine and multiple counts related to the possession and use of firearms.
According to court records and evidence presented at trial, the Nine Trey Gangsters are a Bloods street gang set of the United Blood Nation, which was founded in New York City in the early 1970’s. Thaddaeus Snow led a “line-up” of the Nine Trey Gangsters that operated as a criminal enterprise in Virginia and committed criminal activity in multiple states. From 2008 until the date of the indictment, Snow’s line-ups of Nine Trey gangsters engaged in racketeering activity involving the sex trafficking of women using force and coercion in Virginia, Maryland, North Carolina, New York and elsewhere; the commission of robberies; and the distribution of cocaine, crack, marijuana, heroin, ecstasy and prescription painkillers. The evidence at trial also showed that Snow, Sykes and other Nine Trey Gangsters dealt in counterfeit U.S. currency and used counterfeit currency to finance wholesale drug purchases.
In addition, the evidence at trial showed that Snow and his subordinate gang members undertook several acts of violence. On or about April 1, 2010, Snow directed Nine Trey Gangsters to give a female victim a “buck-fifty,” consisting of slashing the woman’s face with a knife from mouth to ear with the aim of requiring 150 stiches to close the wound, because the woman had stolen proceeds of Snow’s drug sales and used some of Snow’s drug supply. The slashing was carried out by Sykes. Sykes and other gang members beat a man unconscious who may have stolen drugs from a gang member, and Sykes also committed a shooting on April 12, 2010, after the shooting victims became involved in a dispute with one of the gang members. Additionally, Sykes slapped and choked a prostitute when she concealed money she earned from him.
Snow and Sykes were convicted following a trial that began on Feb. 11, 2014. All twenty-four individuals named in the Sept. 26, 2013 indictment have been convicted, bringing to 37 the total number of Nine Trey Gangsters members and associates who have been convicted in the Eastern District of Virginia since 2013.
This case was investigated by the FBI’s Washington Field Office and the Fairfax County Police Department, with assistance from the Northern Virginia Regional Gang Task Force, Hampton Police Department, Fauquier County Sheriff’s Office, Manassas City Police Department and the U.S. Marshals Service. Assistant U.S. Attorneys Adam B. Schwartz and Dennis M. Fitzpatrick prosecuted the case on behalf of the United States.
This case is part of an Organized Crime and Drug Enforcement Task Force (OCDETF) investigation dubbed Operation “Ruby Red,” which has been focusing on the illegal distribution of narcotics by alleged organized crime members.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.New Arrest of TSA Employee and Bklyn Resident: Vernon LythcottRead the Press Release
Lythcott Complaint
Middle Georgia Methamphetamine Distributors SentencedRead the Press Release
Michael J. Moore, United States Attorney for the Middle District of Georgia, announced that members of a major methamphetamine trafficking organization have been sentenced. On January 16, 2014, Shawn Foster Phillips, age 35, of Houston County, Chad Minter, age 40, of Houston County, Marty Bass, age 51, of Houston County, entered guilty pleas to conspiracy to distribute methamphetamine. Travis Walker McElhenny, age 40, of Houston County, pled guilty to possession with intent to distribute methamphetamine. Jon Rylander, age 28, of Houston County, pled guilty to possession of methamphetamine.As a part of their guilty pleas, the respective defendants admitted that between January 1, 2011 and December 31, 2012, Mr. Phillips traveled from Warner Robins, Georgia, to Atlanta, Georgia, to obtain methamphetamine from a Mexican drug supplier. The drugs were transported by Mr. Phillips from Atlanta to Warner Robins where they were sold to Mr. Minter, Mr. Bass, Mr. McElhenny and others in the Warner Robins area. These men then sold the methamphetamine to street level dealers. Conservative estimates suggest that during its operation, the organization distributed more than 50 kilograms of methamphetamine. Federal and state authorities seized 250 grams of methamphetamine and three firearms.
The case was called for sentencing on May 7, 2014, before U.S. District Judge Marc T. Treadwell. Chad Minter was sentenced to 10 years confinement. Travis McElhenny was sentenced to 7 years confinement. Marty Bass was sentenced to 15 years confinement. Jon Rylander was sentenced to 3 years probation. Sentencing on the remaining defendants has not yet been set.
The case was investigated by the Federal Bureau of Investigation, U.S. Marshals Service, and Houston County Sheriff’s Department. Assistant U.S. Attorney Charles L. Calhoun is prosecuting the case.
US Attorney Michael Moore stated, “My office will continue to target and dismantle these types of drug trafficking organizations. Methamphetamine use and distribution poses a significant threat to the public and must be vigorously prosecuted.”
Inquiries regarding the case should be directed to Pamela Lightsey, United States Attorney's Office at (478) 621-2603.
Massage Parlor Manager Pleads GuiltyIn Federal Sex Trafficking CaseRead the Press Release
WICHITA, KAN. - The former manager of a Wichita massage parlor pleaded guilty Friday to a federal charge of transporting a woman from China to work as prostitute in Wichita, U.S. Attorney Barry Grissom said.
Yan Zhang, 50, Wichita, Kan., pleaded guilty to one count of interstate transportation for the purpose of prostitution. In her plea, she admitted that in 2009 she induced a Chinese woman to move to Wichita to work in a massage parlor and engage in prostitution.
In her plea, Zhang said she was married in 2004 to co-defendant Gary Kidgell. During the marriage, she worked at massage parlors in San Francisco and Phoenix, where she became familiar with the operation of massage parlors as fronts for prostitution. In 2009, she and Kidgell moved to Wichita to establish their own massage parlor. She worked giving massages and served as a manager because she was able to communicate with Chinese women who worked at the massage parlor.
Sentencing is set for Aug. 4. Both parties have agreed to recommend a sentence of time served and five years supervised release.
Co-defendants are:
Gary Kidgell, who is set for sentencing Aug. 1.
Xinqing Tian, 44, who was sentenced to time served and two years supervised release.Grissom commended the Wichita Police Department and Assistant U.S. Attorney Jason Hart for their work on the case.
Manhattan U.S. Attorney Announces Return to the Government of Brazil Masterpiece Linked to Bank FraudRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and Bruce Foucart, Special Agent-in-Charge of U.S. Immigration and Customs Enforcement’s (“ICE”) Homeland Security Investigations (“HSI”) Boston Office, announced today that a painting by Serge Poliakoff called “Composition abstraite [Abstract composition]” (the “Poliakoff”) was returned to Brazil at a repatriation ceremony at the United States Attorney’s Office in Manhattan, New York. The painting was smuggled into the United States in violation of U.S. customs law and was forfeited to the United States as a result of civil forfeiture action brought by the United States.
Manhattan U.S. Attorney Preet Bharara stated: “Art and antiquities have special value and meaning that cannot readily be quantified. As a result, they have long been the subject of theft and deception, as well as a means to launder illicit proceeds. Art should serve to inspire the mind and nourish the soul, and not be allowed to become a conduit for crime.”
HSI Special Agent-In-Charge Bruce Foucart stated: “During this seven year investigation, HSI along with our international law enforcement partners have located, detained and seized approximately 1,000 works of art in Switzerland, France, the United Kingdom and the United States, all belonging to Edemar Cid Ferreira. We hope this most recent painting being returned by HSI and the Manhattan U.S. Attorney’s Office to the government of Brazil assists in the recovery of financial losses. HSI remains committed to investigating the illicit importation of cultural property into the United States and the laundering of proceeds derived from illicit activities.”
In a related repatriation ceremony held on September 21, 2010, the U.S. Attorney’s Office for the Southern District of New York returned to Brazil two paintings – “Modern Painting with Yellow Interweave” by Roy Lichtenstein (the “Lichtenstein”) and “Figures dans une structure” by Joaquin Torres-Garcia (the “Torres-Garcia”) – that were smuggled into the United States.
The Poliakoff once belonged to Brazilian banker Edemar Cid Ferreira. Ferreira, the founder and former president of Banco Santos, S.A. (“Banco Santos”), was convicted in Brazil of crimes against the national financial system and money laundering. In December 2006, Ferreira was sentenced in Brazil to 21 years in prison.
As part of the case, a Sao Paulo Court Judge also ordered the search, seizure, and confiscation of assets that Ferreira, his associates, and members of his family had acquired with unlawfully obtained funds from Banco Santos. Those assets included the Poliakoff, the Lichtenstein, the Torres-Garcia, and other artwork valued at $20 million to $30 million. The artwork was kept in several locations, including Ferreira’s home in the Morumbi neighborhood of Sao Paulo, the main offices of Banco Santos, and at a holding facility. When Brazilian authorities searched these locations, they found that several of the most valuable works of art were missing, including the Poliakoff.
The Sao Paulo Court sought INTERPOL’s assistance after searching museums and institutions in Brazil for the missing artwork. In October and November 2007, INTERPOL and the Government of Brazil sought the assistance of the United States to locate and seize the missing works on behalf of the Brazilian government. In response, HSI special agents in New Haven, Connecticut located and seized a painting by Jean-Michel Basquiat called “Hannibal,” and the U.S. Attorney’s Office for the Southern District of New York filed a civil forfeiture Complaint alleging that “Hannibal” had been brought into the United States illegally. Since the filing of the original Complaint in February 2008, the United States seized additional works of art and filed two amended Complaints seeking the forfeiture of four additional artworks listed in the INTERPOL request for assistance.
The Southern District of New York and HSI investigation revealed that the Poliakoff, the Lichtenstein, and the Torres-Garcia were shipped on December 1, 2006, from the Netherlands to a secure storage facility in New York. The invoices, however, failed to comply with U.S. customs laws in a number of respects. For example, the shipping invoices did not identify the names of the paintings or their artists. The invoices also falsely claimed that the combined value of the paintings was $230. In fact, the combined appraisal value of the paintings was recently assessed in excess of $4 million, with the Poliakoff appraised at $500,000.
After the shipment containing the paintings was imported into the United States, the Lichtenstein and the Torres-Garcia were subsequently sold, but the purchasers later voluntarily surrendered the works to HSI. The Poliakoff was shipped to Switzerland, where it was seized by Swiss authorities in July 2008 at the request of the U.S. Attorney’s Office and HSI.
On October 15, 2010, the Poliakoff was forfeited to the United States. “Hannibal,” which was recently valued to be worth about $8 million, and a sculpture known as the “Roman Togatus” have also been forfeited to the United States. An appeal of that decision is pending.
Mr. Bharara praised the investigative work of HSI in helping to locate and seize the painting. He was grateful for the assistance of the Department of Justice’s Office of International Affairs. Mr. Bharara thanked Brazilian authorities for their assistance in the case. He also acknowledged the assistance of the U.S. Department of State and the U.S. Embassy in Brazil for its assistance in the investigation.
The case is being handled by the Money Laundering and Asset Forfeiture Unit of the U.S. Attorney’s Office. Assistant U.S. Attorneys Jason P. Hernandez and Alexander Wilson are in charge of the litigation.
Brazilian Paintings 2nd Amended Complaint
Manhattan U.S. Attorney Announces Agreement with Swiss Asset Management Firm and Related Companies to Resolve Criminal Tax InvestigationRead the Press Release
The Swisspartners Group Earned Non-Prosecution Agreement As a Result of its Extraordinary Cooperation and Self-Reporting
James M. Cole, the Deputy Attorney General of the Department of Justice, Preet Bharara, the United States Attorney for the Southern District of New York, Kathryn Keneally, the Assistant Attorney General for the Tax Division of the Department of Justice, and Richard Weber, the Chief of the Internal Revenue Service, Criminal Investigation (“IRS-CI”), announced today that swisspartners Investment Network AG, a Swiss-based asset management firm, and three of its wholly-owned subsidiaries (collectively, the “Swisspartners Group”), entered into a non-prosecution agreement (“NPA”) with the U.S. Attorney’s Office for the Southern District of New York and agreed to pay $4.4 million to the United States. The NPA was entered into based on, among other things, the Swisspartners Group’s remedial measures, voluntary self-reporting, and extraordinary cooperation, including its voluntary production of approximately 110 client files for non-compliant U.S.-taxpayer clients, and provides that the Swisspartners Group will not be criminally prosecuted for assisting U.S. taxpayer-clients in opening and maintaining undeclared foreign bank accounts from in or about 2001 through in or about 2011. The NPA requires the Swisspartners Group to forfeit $3.5 million to the United States, representing certain fees that it earned by assisting its U.S. taxpayer-clients in opening and maintaining these undeclared accounts, and to pay $900,000 in restitution to the IRS, representing the approximate amount of unpaid taxes arising from the tax evasion by the Swisspartners Group’s U.S. taxpayer-clients. The NPA applies only to the four specific entities that are party to it and does not apply to any other subsidiaries of swisspartners Investment Network AG or any individuals.
Deputy Attorney General James Cole said: “The extraordinary cooperation of Swisspartners has enabled us to identify U.S. tax cheats who have hidden behind phony offshore trusts and foundations. In this and other cases around the world we will continue to provide substantial credit for prompt and full cooperation.”
Manhattan U.S. Attorney Preet Bharara said: “This Office will continue to work aggressively to hold accountable not only those U.S. taxpayers who evade their tax obligations by hiding money overseas, but also those abroad who make such tax evasion possible. For its wrongdoing in assisting U.S. taxpayers to open and maintain undeclared accounts overseas, the Swisspartners Group is being made to pay $4.4 million in forfeiture and restitution. Swisspartners avoided criminal charges as a direct result of its decision to self-report its misconduct at a time when it was not even under investigation and its extraordinary cooperation, including its decision to turn over voluntarily the files and identities of U.S. taxpayer clients it helped hide money from the IRS. The case serves as a clear example of the benefits that can be obtained from early and complete cooperation with federal law enforcement.”
Assistant Attorney General Kathryn Keneally said: “As today’s announcement shows, we receive information about U.S. taxpayers with undisclosed accounts from many sources, some of which are not public. For many accountholders, the time to come forward voluntarily to avoid criminal prosecution has run out.”
IRS-CI Chief Richard Weber said: “I am very pleased that we have successfully concluded negotiations with the Swisspartners Group. In making amends, the Swisspartners Group has turned over 110 account files relating to U.S. taxpayer-clients who maintained undeclared assets overseas. This agreement marks yet another significant step forward in combating offshore tax evasion. Anyone who is hiding money or assets offshore with the intent of committing tax evasion will be found and prosecuted. It's not a matter of ‘if,’ it's a matter of “when.’”
The NPA was entered into between the U.S. Attorney’s Office, on the one hand, and swisspartners Investment Network AG and the following three wholly-owned subsidiaries, on the other: swisspartners Wealth Management AG, a Zurich-based company that establishes and manages entities such as foundations and trusts; swisspartners Insurance Company SPC Ltd., a Cayman Islands-based life insurance carrier that offers life insurance and annuity products; and swisspartners Versicherung AG, a Liechtenstein-based insurance carrier that offers a variety of insurance and annuity products
The NPA recognizes that, beginning in 2008, the Swisspartners Group voluntarily implemented a series of remedial measures to stop assisting U.S. taxpayers in evading federal income taxes. The NPA further recognizes that in 2012, at a time when it was neither a subject nor target of any investigation by the U.S. Department of Justice, the Swisspartners Group self-reported its conduct concerning U.S. taxpayer-clients to the Department of Justice. Additionally, the NPA recognizes the extraordinary cooperation of the Swisspartners Group, including its voluntary production of client files for 110 non-compliant U.S. taxpayers that included the identities of those U.S. taxpayers.
As part of the NPA, the Swisspartners Group admitted various facts concerning its wrongful conduct and the remedial measures that it took to cease that conduct. Specifically, the Swisspartners Group admitted that it knew certain U.S. taxpayers were maintaining undeclared foreign bank accounts with the assistance of the Swisspartners Group in order to evade their U.S. tax obligations, in violation of U.S. law. The Swisspartners Group acknowledged that it helped certain U.S. taxpayer-clients conceal from the IRS their beneficial ownership of undeclared assets maintained in foreign bank accounts by, among other things, creating sham foundations and other sham entities that served as the nominal account holders; placing accounts or insurance policies in the names of non-U.S. nationals; facilitating the transportation of large amounts of cash into the United States on behalf of U.S. taxpayer-clients; and arranging for the bulk deposit of cash at Swiss depository financial institutions on behalf of U.S. taxpayer-clients.
As part of the NPA, the Swisspartners Group has agreed to forfeit $3.5 million to the United States, representing certain fees it obtained in exchange for services that it provided to U.S. taxpayers with undeclared foreign bank accounts from in or about 2001 through in or about 2011. In connection with this forfeiture, the Swisspartners Group has agreed not to contest a civil forfeiture action filed by the United States. That action was filed on May 9, 2014, in the U.S. District Court for the Southern District of New York and assigned to U.S. District Judge Gregory H. Woods.
The U.S. Attorney’s Office entered into the NPA based on factors including:
- the Swisspartners Group’s voluntary implementation of various remedial measures beginning in or about May 2008;
- the Swisspartners Group’s voluntary self-reporting of its criminal conduct at a time when it was neither a subject nor target of any investigation by the U.S. Department of Justice;
- the Swisspartners Group’s voluntary and extraordinary cooperation, including its voluntary production of account files that include the identities of U.S. taxpayer-clients;
- the Swisspartners Group’s willingness to continue to cooperate to the extent permitted by applicable law; and
- the Swisspartners Group’s representation, based on an investigation by outside counsel, the results of which have been shared with the U.S. Attorney’s Office and the Tax Division, that the misconduct under investigation did not, and does not, extend beyond that described in the Statement of Facts.
The NPA requires the Swisspartners Group to continue to cooperate with the United States for at least three years from the date of the agreement. In the event that the Swisspartners Group violates the NPA, the U.S. Attorney’s Office may prosecute the Swisspartners Group.
Mr. Bharara thanked the IRS for its outstanding work in the investigation of this matter and the Tax Division of the Department of Justice for its assistance in the investigation.
This investigation is being overseen by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Jason H. Cowley, Sarah E. Paul, and Jared P. Lenow are in charge of the matter.
U S v $3500000 (Swisspartners Forfeiture Complaint)
Longtime Pimp Sentenced to 10 Years in Federal Prison for Taking SoCal Woman to Las Vegas to Work as ProstituteRead the Press Release
SANTA ANA, California – A man previously convicted and sentenced to 14 years in federal prison for transporting minors to work as prostitutes today received what is effectively another 14-year sentence for engaging in the same conduct involving a 19-year-old victim almost immediately after he was released from custody in the first case.
William Earl Flavors, aka “Andre,” 40, who most recently resided in Long Beach, was sentenced this morning to 10 years in federal prison. United States District Judge Josephine L. Staton ordered that this sentence run consecutive to a four-year prison term he received last year based on related conduct for violating his supervised release on his prior federal conviction, meaning that Flavors has been ordered to serve 14 years in prison for acting as a pimp for girls in 2012.
At today’s sentencing hearing, Judge Staton discussed a letter that Flavors wrote to the Court in which he blamed the judicial system and the probation department for his current “predicament” and that he “not given a fair chance.” Judge Staton noted “beating women and forcing them into prostitution is not a ‘predicament,’ but a choice – a choice that defendant made.”
Flavors pleaded guilty in December to transportation in interstate commerce for purposes of prostitution. Flavors specifically admitted that he transported his victims between Long Beach to Las Vegas, forced or coerced them to work as prostitutes in Las Vegas, and used physical abuse and threats of additional physical abuse to make one of his victims work for him as a prostitute.
“In order to coerce and force [the victim] into continuing to engage in prostitution, defendant physically abused her, threatened her with additional physical abuse, and did not allow her to leave him,” according to a sentencing memo filed by prosecutors. The sentencing memo also details the physical abuse defendant carried out on his victim, including “beating her with his fists and on one occasion burning her legs with a lit cigarette.”
Today’s sentencing concludes the second case in which Flavors has been convicted in federal court of trafficking women across state lines and forcing them to work as prostitutes. In December 1999, he pleaded guilty to transportation of a
15-year-old girl and a 17-year-old girl in interstate commerce for prostitution. In addition to transporting these minors from Washington to California, Flavors beat, raped and forced these girls into prostitution on his behalf, according to court documents.In the 1999 case, Flavors’ “depravity towards his victims included, among other acts: breaking one victim’s nose from beating her; and beating another victim with clothes hangers, burning her with curling irons, and forcing her to drink cups of urine and cigarette butts,” prosecutors wrote in a sentencing memo.
The case against Flavors was investigated by Federal Bureau of Investigation.Release No. 14-059
Illegal Drug Company Gallant Pharma and Co-Founder SentencedRead the Press Release
ALEXANDRIA, Va. – Gallant Pharma International Inc. (Gallant Pharma), an unlicensed wholesale drug distributor headquartered in Arlington, Va., that distributed more than 17,000 units of non-FDA-approved cancer and cosmetic drugs to doctors across the United States, was sentenced today to pay $3.4 million in forfeiture and restitution. On Dec. 2, 2013, Gallant Pharma pleaded guilty to two counts of illegal importation, five counts of introducing misbranded drugs and five counts of unlicensed prescription drug wholesaling.
Syed “Farhan” Huda, 39, formerly of Arlington, Va., co-founder and co-owner of Gallant Pharma, was sentenced today to 36 months in prison, followed by two years of supervised release. Huda also was ordered to pay $3.4 million in forfeiture and restitution to victims. On Dec. 2, 2013, Huda pleaded guilty to illegal importation, introducing misbranded drugs, unlicensed medical wholesaling and wire fraud.
Also sentenced today was Gallant Pharma office manager Deeba Mallick, 37, the wife of co-owner Huda. Mallick was sentenced to nine months in prison, one year of supervised release and a $75,000 fine. Mallick pleaded guilty on Dec. 19, 2013 to misprision of a felony.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; Antoinette V. Henry, Special Agent in Charge of the Food and Drug Administration’s (FDA) Office of Criminal Investigations; Katrina W. Berger, Acting Special Agent in Charge, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), Washington; Gary Barksdale, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service; Karl C. Colder, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division; and M. Douglas Scott, Arlington County Chief of Police, made the announcement after the sentencings by U.S. District Judge Claude M. Hilton.
According to information made public in court, between August 2009 and August 2013, Gallant Pharma smuggled into the United States and sold more than $12.4 million in non-FDA-approved chemotherapy drugs and injectable cosmetic drugs and devices, generating profits of $3.4 million. Many of these drugs were subject to strict temperature controls to protect drug potency. Gallant Pharma shipped and received such drugs with ice packs, not dry ice as used by legitimate distributors, and on at least one occasion, a shipment containing such drugs took more than two weeks to arrive in Virginia from overseas during a July 2012 heat wave. Many drugs sold by Gallant Pharma were also required to carry a FDA “black box” warning, which indicates that a drug carries a significant risk of serious or life-threatening adverse effects. The versions sold by Gallant Pharma did not meet this or other FDA labeling requirements.
On Tuesday, co-conspirators Anoushirvan Sarraf, 48, and Eva Montejo Pritchard, 48, both of Rockville, Maryland, were convicted by a federal jury for their involvement in the scheme. Sarraf, a licensed doctor and the owner of Aphrodite Skin Care & Esthetic Clinic in McLean, Virginia, and Pritchard, Aphrodite’s office manager, received hundreds of shipments addressed to Aphrodite, containing illegal importations intended for Gallant Pharma, in exchange for a deeply discounted price on non-FDA-approved drugs and devices. While cancer drugs were always handed off to Gallant Pharma, the defendants kept many of the non-FDA-approved cosmetic drugs and devices, which were used on Aphrodite patients without the patients’ knowledge or consent.
To date, twelve defendants associated with Gallant Pharma have been convicted. Two additional defendants named in the indictment, Robert Wachna and Munajj Rochelle, remain fugitives and are believed to be in Canada.
This case was investigated by FDA’s Office of Criminal Investigations, DEA’s Group 33 Diversion Task Force, ICE-HSI and the U.S. Postal Inspection Service, with assistance from INTERPOL and the Arlington County Police Department. Assistant U.S. Attorneys Lindsay Kelly, Maya Song and Jay Prabhu are prosecuting the case on behalf of the United States.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Illegal Alien Pleads Guilty to Producing False IDRead the Press Release
BOSTON – An illegal alien pleaded guilty today in U.S. District Court in Worcester in connection with a conspiracy to produce false identification documents.
Leonardo Burgos Espinal, 42, pleaded guilty before U.S. District Judge Timothy S. Hillman to conspiracy to commit fraud in connection with identification documents. In March 2013, Burgos Espinal was charged by information with bribing an employee of the Massachusetts Registry of Motor Vehicles.
From January 2011 through June 2012, Burgos would direct his “clients” to present fraudulently obtained, but valid, Puerto Rican identification documents to his co-conspirator at the RMV, who would then issue a valid Massachusetts driver’s license or ID knowing that the Puerto Rican documents belonged to other real people. This plea is the most recent development in investigations involving identity theft and public corruption relating to the Massachusetts Registry of Motor Vehicles.Burgos Espinal faces a statutory maximum penalty of five years in prison, three years of supervised release, restitution, and a $250,000 fine.
United States Attorney Carmen M. Ortiz; Bruce M. Foucart, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations in Boston; and Colonel Timothy P. Alben, Superintendent of the Massachusetts States Police; made the announcement today. The case is being prosecuted by Eugenia M. Carris of Ortiz’s Public Corruption Unit.
Glen Burnie Drug Dealer Sentenced to 10 Years in PrisonRead the Press Release
Baltimore, Maryland – U.S. District Judge James K. Bredar sentenced Chad Bennet Brown, age 34, of Glen Burnie, Maryland, on May 8, 2014, to 10 years in prison, followed by three years of supervised release, after pleading guilty to conspiracy to distribute and possess with the intent to distribute heroin and cocaine.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Assistant Special Agent in Charge Gary Tuggle of the Drug Enforcement Administration, Baltimore District Office; Anne Arundel County Police Chief Kevin Davis; Chief James W. Johnson of the Baltimore County Police Department; and Colonel Michael Kundrat, Chief of the Maryland Transportation Authority Police.
According to Brown’s plea agreement, from May 2013, through February 10, 2014, Chad Bennett Brown, conspired with others to acquire quantities of cocaine and heroin from sources of supply in Texas for distribution in Maryland. Arrangements for the acquisition of the drugs were made by Brown, while a co-conspirator drove from Maryland to Texas to secure the drugs, often carrying cash to pay for the drugs. On one occasion, the co-conspirator was en route from Maryland to Texas when he was stopped by police in Dickson County, Tennessee and approximately $132,000 was seized. This money was intended for delivery to a source of supply in Texas as payment for several kilograms of cocaine.This pattern of activity, which involved Brown making arrangements with the sources of supply and the co-conspirator taking money to Texas or picking up drugs in Texas, was repeated on at least ten occasions. On February 10, 2014, the co-conspirator was arrested with 2.5 kilograms of heroin in Jefferson County, Texas, while en route back to Maryland.
Over the course of the conspiracy, Brown was responsible for the distribution of over one kilogram of heroin and five kilograms of cocaine. At the time of his arrest, Brown was on supervised release for a previous federal drug conviction.
United States Attorney Rod J. Rosenstein praised the DEA, Anne Arundel County and Baltimore County Police Departments and the Maryland Transportation Authority Police for their work in the investigation. U.S. Attorney Rosenstein also recognized the Dickson County, Tennessee Sheriff’s Office, Jefferson County, Texas Sheriff’s Office and the U.S. Attorney’s Office for the Eastern District of Texas for their assistance in the investigation and prosecution. Mr. Rosenstein thanked Assistant U.S. Attorneys James G. Warwick and Kenneth S. Clark, who prosecuted the case.
Former Restaurant Owner Pleads Guilty to Federal Tax Charge-Admits Under-Reporting Gross Receipts and Overstating Expenses on Tax Returns-Read the Press Release
WASHINGTON – Zewditu Wondemu, 62, who owned Zed’s Restaurant, a business in the Georgetown area of Washington, D.C., pled guilty today to a federal tax charge for under-reporting gross receipts and income and overstating expenses on tax returns.
The guilty plea was announced by U.S. Attorney Ronald C. Machen Jr. and Thomas J. Kelly, Special Agent in Charge of the Washington Field Office of the Internal Revenue Service-Criminal Investigation (IRS-CI).
Wondemu pled guilty in the U.S. District Court for the District of Columbia to one count of filing a false tax return. The Honorable Beryl A. Howell scheduled sentencing for Aug. 1, 2014. The charge carries a statutory maximum of three years in prison and financial penalties. Under federal sentencing guidelines, Wondemu faces a likely range of 10 to 16 months in prison and a fine of up to $30,000. As part of her plea, she must pay $50,350 in restitution to the United States government, representing the taxes still owed.
According to the government’s evidence, Wondemu owned and operated Zed’s Restaurant at the time of the offenses. She admitted understating gross receipts on corporate income tax returns for the tax years 2005 through 2008. At the same time, she overstated business expenses. Additionally, she admitted understating her income on individual income tax returns for the tax years 2005 through 2008. As a result of her actions, the tax losses to the government for those years totaled at least $50,350. Wondemu has since sold the restaurant.
In announcing the guilty plea, U.S. Attorney Machen and Special Agent in Charge Kelly commended the work of those who investigated the case for IRS-CI. In addition, they expressed appreciation for the assistance provided by Trial Attorney Erin Pulice of the Department of Justice’s Tax Division and Associate Director Jeffrey Olson of the Department of Justice’s Office of International Affairs. They also acknowledged the efforts of those who handled the case for the U.S. Attorney’s Office, including Paralegal Specialist Donna Galindo, Criminal Investigator Stephen Cohen, and Assistant U.S. Attorney Philip A. Selden, of the Fraud and Public Corruption Section, who is prosecuting the matter.
14-109Former Mayor of Martin Convicted of Violating Civil Rights and Buying VotesRead the Press Release
PIKEVILLE – The former Mayor of Martin, Ky., has been convicted of intentionally violating voters’ civil rights, during her reelection campaign in 2012.
On Thursday evening, a federal jury in Pikeville, Ky., convicted former Martin Mayor, Ruth Thomasine Robinson, 69, of conspiracy to violate civil rights and one count of vote buying. The jury also convicted her husband, James “Red” Robinson, 64, of the conspiracy count and one vote buying count. Her stepson, James Steven Robinson, 32, was found guilty of the conspiracy count and two of three vote buying counts and another co-defendant, Johnny T. Moore, 32,was acquitted of all charges. The jury returned the verdicts after approximately two hours of deliberation, following three days of trial.
According to evidence introduced at trial, Thomasine Robinson and her co-conspirators intimated poor and disabled citizens in order to gain their votes during the 2012 general election in Martin. For instance, members of the conspiracy directed residents of public housing to vote by absentee ballot under the supervision of Thomasine Robinson or another member of the conspiracy. The members of the conspiracy also targeted residents of private housing owned and leased by Thomasine Robinson.
The trial testimony established that the members of the conspiracy filled out absentee ballots, marking the conspirators’ choice of candidates, and then had the voters sign the pre-marked ballots. Voters who cooperated with this arrangement and voted for Thomasine Robinson received promises of better living arrangements and other consideration. Voters who did not comply faced consequences such as eviction and the loss of priority for public housing.
In addition, the evidence at trial established that the defendants offered to pay several voters to vote for Thomasine Robinson.
Kerry B. Harvey, U.S. Attorney for the Eastern District of Kentucky; Perrye K. Turner, Special Agent in Charge, FBI; and Jack Conway, Kentucky Attorney General, jointly announced the conviction.
The investigation was conducted by the FBI and the Kentucky Attorney General’s Office. Assistant U.S. Attorneys Kenneth R. Taylor and Andrew T. Boone represent the federal government in this case.
Sentencing is scheduled for September 9. The defendants face a maximum of 10 years in prison for the conspiracy offense and a maximum of five years in prison on the vote buying offenses. However, the Court must consider the U.S. Sentencing Guidelines and the federal statutes before imposing a sentence.
Former Maryland Sergeant Sentenced for Obstruction of JusticeRead the Press Release
Josh Hummer, formerly a sergeant at Roxbury Correctional Institution (RCI) in Hagerstown, Maryland, was sentenced today to serve 12 months and a day in prison for obstruction of justice. Previously, on Jan. 31, 2014, a federal jury found Hummer guilty of providing false and misleading information to state investigators tasked with conducting an inquiry into a series of staff assaults against an inmate, Kenneth Davis, at RCI.Evidence presented at trial showed that Hummer, 41, of Chambersburg, Pennsylvania, was on duty as a sergeant at RCI on the morning of March 9, 2008, when officers assaulted Davis inside a cell. On April 3, 2008, Hummer lied to a Maryland State Police detective about that assault.
Sixteen former RCI officers have been convicted in connection with the series of assaults against Davis. Through those guilty pleas, the defendants have admitted that officers from three different shifts, including Hummer’s, assaulted Davis in retaliation for a prior incident in which Davis had hit an officer. As a result of these beatings, Davis suffered broken bones in his face, ribs and back.
“The vast majority of correctional supervisors serve their communities with honor and integrity,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “When a supervisor at a correctional facility tries to cover up a staff assault of an inmate, however, the Department of Justice will do its utmost to hold him accountable.”
This case was investigated by the Frederick Resident Agency of the FBI, and prosecuted by Special Litigation Counsel Forrest Christian and Trial Attorneys Sanjay Patel and Christine Siscaretti, with the support of Assistant U.S. Attorney Michael Cunningham of U.S. Attorney’s Office for the District of Maryland.
Former Ft. Lauderdale Resident Pleads Guilty to Bank Fraud Using MBC Shell Company to Defraud A Financial InstitutionRead the Press Release
Wifredo Ferrer, United States Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Jose A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), announce that Henry Fecker, III, 60, of Ft. Lauderdale, pled guilty yesterday before U.S. District Judge Robin S. Rosenbaum in Ft. Lauderdale to a superseding information charging him with one count of bank fraud. Sentencing for Fecker is scheduled for July 18, 2014 before Judge Rosenbaum.
According to court documents, Fecker was the listed owner of Camden Consulting, Inc., a shell company used by the principals of Mutual Benefits Corporation (MBC) to receive proceeds from a massive Ponzi scheme, from approximately 1994 through 2004. According to court documents, in 2006, Fecker obtained a $1.5 million bank loan from Washington Mutual Bank in the form of a cash-out refinance of a waterfront vacation house in Camden, Maine. The vacation house had been purchased with funds derived from MBC. Fecker and his accomplice, Steven Steiner a/k/a Steven Steinger, received $487,801.15 as proceeds from the bank loan. According to court documents, Fecker acknowledged that he and Steiner held the funds in the form of ten separate certified bank checks and cashed them periodically between 2008 and 2011. Fecker acknowledged that this was done to conceal the funds from judgment creditors, including the U.S. Securities and Exchange Commission. Fecker used the funds to support a lavish lifestyle and to pay bills for Fecker, Steiner and Steiner’s brother, Joel Steinger, in the years after MBC shut down.
Fecker made material false statements on the loan application under penalty of perjury, including by claiming a monthly salary of $102,083, and that he had been the President of Camden Consulting for 11 years. Fecker also provided a false residence and business address to make the claim of employment appear legitimate. In truth, Camden Consulting was never a real company, had no real business, and Fecker had not had any employment since approximately 1996 when he worked at MBC.
In an earlier case, United States v. Henry Fecker, III and Steven Steiner, No. 11-20578-KMW, in February 2013, Steiner and Fecker were defendants in a four-week trial before U.S. District Judge Kathleen Williams, for money laundering and obstruction of justice. Steiner was convicted of 31 counts and Fecker was acquitted of all counts.
And, in earlier proceedings, Joel Steinger and Steven Steiner pleaded guilty to charges in this case, No. 12-20123-RSR, and a separate case related to the MBC fraud, No. 08-21158-CR-RNS.
Mr. Ferrer commended the investigative efforts of the FBI and IRS-CI. This case is being prosecuted by Assistant U.S. Attorneys Jerrob Duffy, Dwayne E. Williams and Alison Lehr.
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.
Former EBAY Exec Pleads Guilty to Insider TradingRead the Press Release
PHILADELPHIA - Christopher Saridakis, 45, of Wilmington DE, pleaded guilty today to securities fraud for giving another person confidential information about a company’s stock. Saridakis was a senior executive at GSI Commerce, Inc. (“GSIC”), when he provided material, non-public information regarding eBay’s pending acquisition of GSIC. U.S. District Court Judge Stewart Dalzell scheduled a sentencing hearing for September 19, 2014.
On March 20, 2011, Saridakis, who was privy to discussions of a merger, sent a series of text messages to a Confidential Witness (“CW1”) that began with the defendant asking if CW1 “...own[ed] our [GSIC] shares?” CW1 replied, “no, but it’s cheap.” This response led Saridakis to tell CW1 “you should.” CW1 responded with “ok,” to which Saridakis replied, “soon.” On March 22, 2011, following the receipt of the text messages, while in possession of the inside information, and knowing defendant Saridakis’ position as a senior executive at GSIC, CW1 purchased and caused to be purchased 25,000 shares of GSIC stock on margin for approximately $470,000. On June 20, 2011, CW1 received $737,500 in exchange for the 25,000 shares of GSIC, equating to an illicit profit of $260,304, as a result of the text messages. Saridakis also shared the same material non-public information with other individuals.
Saridakis faces a maximum possible sentence of 20 years in prison, three years of supervised release, a $5 million fine, and a $100 special assessment.
The case was investigated by the FBI. The case is being prosecuted by Assistant United States Attorney Joel D. Goldstein. Saridakis and others have been charged in a parallel civil matter by the Securities and Exchange Commission.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Former EBAY Exec Pleads Guilty to Insider TradingRead the Press Release
PHILADELPHIA - Christopher Saridakis, 45, of Wilmington DE, pleaded guilty today to securities fraud for giving another person confidential information about a company’s stock. Saridakis was a senior executive at GSI Commerce, Inc. (“GSIC”), when he provided material, non-public information regarding eBay’s pending acquisition of GSIC. U.S. District Court Judge Stewart Dalzell scheduled a sentencing hearing for September 19, 2014.
On March 20, 2011, Saridakis, who was privy to discussions of a merger, sent a series of text messages to a Confidential Witness (“CW1”) that began with the defendant asking if CW1 “...own[ed] our [GSIC] shares?” CW1 replied, “no, but it’s cheap.” This response led Saridakis to tell CW1 “you should.” CW1 responded with “ok,” to which Saridakis replied, “soon.” On March 22, 2011, following the receipt of the text messages, while in possession of the inside information, and knowing defendant Saridakis’ position as a senior executive at GSIC, CW1 purchased and caused to be purchased 25,000 shares of GSIC stock on margin for approximately $470,000. On June 20, 2011, CW1 received $737,500 in exchange for the 25,000 shares of GSIC, equating to an illicit profit of $260,304, as a result of the text messages. Saridakis also shared the same material non-public information with other individuals.
Saridakis faces a maximum possible sentence of 20 years in prison, three years of supervised release, a $5 million fine, and a $100 special assessment.
The case was investigated by the FBI. The case is being prosecuted by Assistant United States Attorney Joel D. Goldstein. Saridakis and others have been charged in a parallel civil matter by the Securities and Exchange Commission.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Former Chief Executive Officer of Oil Services Company <br /> Indicted in New Jersey on Foreign Bribery and Kickback ChargesRead the Press Release
The former co-chief executive officer (CEO) of PetroTiger Ltd. – a British Virgin Islands oil and gas company with operations in Colombia and offices in New Jersey – was indicted today for his role in a scheme to pay bribes to foreign government officials in violation of the Foreign Corrupt Practices Act (FCPA) and to defraud PetroTiger.
Acting Principal Deputy Assistant Attorney General Marshall Miller of the Justice Department’s Criminal Division, U.S. Attorney Paul J. Fishman of the District of New Jersey and Special Agent in Charge Aaron T. Ford of the FBI’s Newark Division made the announcement.
Joseph Sigelman, 43, of Miami and the Philippines, was indicted today by a federal grand jury in the District of New Jersey and charged with conspiracy to violate the FCPA and to commit wire fraud, conspiracy to launder money, and substantive FCPA and money laundering violations. Gregory Weisman, 42, of Moorestown, New Jersey, the former general counsel of PetroTiger, pleaded guilty on Nov. 8, 2013, to conspiracy to violate the FCPA and to commit wire fraud. Sigelman’s co-CEO, Knut Hammarskjold, 42, of Greenville, South Carolina, pleaded guilty to the same charge on Feb. 18, 2014.
According to court records, Sigelman and others allegedly paid bribes to an official in Colombia in exchange for the official’s assistance in securing approval for an oil services contract worth roughly $39 million. To conceal the bribes, they first attempted to make the payments to a bank account in the name of the foreign official’s wife for purported consulting services she did not perform. Sigelman and Hammarskjold provided Weisman invoices, including her bank account information. The conspirators made the payments directly to the official’s bank account when attempts to transfer the money to his wife’s account failed. Sigelman and his conspirators then took steps to conceal the bribe payments from PetroTiger’s board members.
In addition, court documents allege that Sigelman and others attempted to secure kickback payments while negotiating an acquisition of another company on behalf of PetroTiger, including on behalf of several members of PetroTiger’s board of directors who were helping to fund the acquisition. In exchange for negotiating more favorable terms for the owners of the target company, two of the owners agreed to kick back to the conspirators a portion of the increased purchase price. To conceal the kickback payments, Sigelman and others had the payments deposited into Sigelman’s bank account in the Philippines, created a “side letter” to falsely justify the payments and used the code name “Manila Split” to refer to the payments amongst themselves.
Sigelman and Hammarskjold were charged by sealed complaints filed in the District of New Jersey on Nov. 8, 2013. Hammarskjold was arrested Nov. 20, 2013, at Newark Liberty International Airport. Sigelman was arrested on Jan. 3, 2014, in the Philippines. The charges against Sigelman, Hammarskjold and Weisman were unsealed on Jan. 6, 2014.
The charges contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
The case was brought to the attention of the department through a voluntary disclosure by PetroTiger, which cooperated with the department’s investigation. The department has worked closely with and has received significant assistance from its law enforcement counterparts in the Republic of Colombia and greatly appreciates their assistance in this matter. The department also thanks the Republic of the Philippines, including the Bureau of Immigration, and the Republic of Panama for their assistance in this matter. Significant assistance was also provided by the Criminal Division’s Office of International Affairs.
The case is being investigated by the FBI’s Newark Division. The case is being prosecuted by Assistant Chief Daniel S. Kahn of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Zach Intrater of the District of New Jersey.
Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa .Former Chief Executive Officer of Oil Services Company Indicted in New Jersey on Foreign Bribery and Kickback ChargesRead the Press Release
NEWARK, N.J. – The former co-chief executive officer (CEO) of PetroTiger Ltd. – a British Virgin Islands oil and gas company with operations in Colombia and offices in New Jersey – was indicted today for his role in a scheme to pay bribes to foreign government officials in violation of the Foreign Corrupt Practices Act (FCPA) and to defraud PetroTiger.
U.S. Attorney Paul J. Fishman of the District of New Jersey, Acting Principal Deputy Assistant Attorney General Marshall Miller of the Justice Department’s Criminal Division and Special Agent in Charge Aaron T. Ford of the FBI’s Newark Division made the announcement.
Joseph Sigelman, 43, of Miami and the Philippines, was indicted today by a federal grand jury in Camden, N.J., with conspiracy to violate the FCPA and to commit wire fraud, conspiracy to launder money, and substantive FCPA and money laundering violations. Gregory Weisman, 42, of Moorestown, N.J., the former general counsel of PetroTiger, pleaded guilty on Nov. 8, 2013, to conspiracy to violate the FCPA and to commit wire fraud. Sigelman’s co-CEO, Knut Hammarskjold, 42, of Greenville, S.C., pleaded guilty to the same charge on Feb. 18, 2014.
According to documents filed in this case and statements made in court:
Sigelman and others paid bribes to an official in Colombia in exchange for the official’s assistance in securing approval for an oil services contract worth roughly $39 million. To conceal the bribes, they first attempted to make the payments to a bank account in the name of the foreign official’s wife for purported consulting services she did not perform. Sigelman and Hammarskjold provided Weisman invoices, including her bank account information. The conspirators made the payments directly to the official’s bank account when attempts to transfer the money to his wife’s account failed. Sigelman and his conspirators took steps to conceal the bribe payments from PetroTiger’s board members.
In addition, Sigelman and others attempted to secure kickback payments while negotiating an acquisition of another company on behalf of PetroTiger, including on behalf of several members of PetroTiger’s board of directors who were helping to fund the acquisition. In exchange for negotiating more favorable terms for the owners of the target company, two of the owners agreed to kick back to the conspirators a portion of the increased purchase price. To conceal the kickback payments, Sigelman and others had the payments deposited into Sigelman’s bank account in the Philippines, created a “side letter” to falsely justify the payments and used the code name “Manila Split” to refer to the payments amongst themselves.
Sigelman and Hammarskjold were charged by sealed complaints filed in the District of New Jersey on Nov. 8, 2013, with conspiracy to commit wire fraud, conspiracy to violate the FCPA, conspiracy to launder money and substantive violations of the FCPA. Hammarskjold was arrested Nov. 20, 2013, at Newark Liberty International Airport. Sigelman was arrested on Jan. 3, 2014, in the Philippines. The charges against Sigelman, Hammarskjold and Weisman were unsealed on Jan. 6, 2014. Today’s indictment consolidates the complaint’s conspiracy to commit wire fraud and to violate the FCPA charges into a single count, and adds one count of transacting in criminal proceeds.
The conspiracy to commit wire fraud and violations of the FCPA count carries a maximum potential penalty of five years in prison and a fine of the greater of $250,000 or twice the value gained or lost. The three substantive FCPA counts each carry a maximum potential penalty of five years in prison and a fine of the greater of $250,000 or twice the value gained or lost. The conspiracy to commit money laundering count carries a maximum potential penalty of 20 years in prison and a fine of the greater of $500,000 or twice the value of the property involved in the transaction. The transacting in criminal proceeds charge carries a maximum potential penalty of 10 years in prison and $250,000 or twice the gain or loss from the offense.
The charges and allegations contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
The case was brought to the attention of the department through a voluntary disclosure by PetroTiger, which cooperated with the department’s investigation. The department has worked closely with and has received significant assistance from its law enforcement counterparts in the Republic of Colombia and greatly appreciates their assistance in this matter. The department also thanks the Republic of the Philippines, including the Bureau of Immigration, and the Republic of Panama for their assistance in this matter. Significant assistance was also provided by the Criminal Division’s Office of International Affairs.
The case is being investigated by the FBI’s Newark Division. The case is being prosecuted by Assistant U.S. Attorney Zach Intrater of the District of New Jersey and Assistant Chief Daniel S. Kahn of the Criminal Division’s Fraud Section.
Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.14-160
Defense counsel: Andrew C. Lourie, Matthew I. Menschel, William A. Burck, Juan Pablo Morillo Esqs., Washington; Patrick J. Egan Esq., Philadelphia
Sigelman, Joseph Indictment
Former Boy Scouts of America Leader Sentenced to 7 Years in Federal Prison for Receipt of Child PornographyRead the Press Release
TULSA, Okla. — United States Attorney for the Northern District of Oklahoma, Danny C. Williams Sr., announced today that a former Boy Scouts of America Lodge Chief and Scout leader was sentenced in Federal court for receiving child pornography.
Kevin D. Woolsey, 22, of Jenks, was sentenced by United States Court Judge Claire V. Eagan to serve 84 months, to be followed by 10 years of supervised release, after a one-count Information charge for Receipt of Child Pornography. Woolsey was charged by sealed Information on September 19, 2013, and entered a guilty plea on November 5, 2013. The defendant targeted males between 14 to 16 years of age who primarily participated in the Boy Scouts or who were members of a church youth group.
“The defendant used his position of authority to exploit and manipulate children,” said U.S. Attorney Williams. “My office will continue to work with our law enforcement partners to punish those who would prey on the most vulnerable in our communities.”
Specifically, Woolsey admitted that on or about May 19, 2012, he received one or more visual depictions involving the use of minors engaging in sexually explicit conduct. Woolsey created a fictitious Facebook page that falsely purported to belong to a minor female known to the victim. Woolsey established communication with the victim through the Facebook page, then engaged the victim in sexually-oriented conversation and sent the victim pornographic images. Posing as a minor female, Woolsey requested photos from the victim, who sent the photos via the internet to an e-mail address Woolsey provided.
Woolsey received pornographic images from at least 11 minors. He created at least 7 fictitious Facebook accounts posing as different female minors from the church youth group.
The case was investigated by the U.S. Immigration and Customs Enforcement and prosecuted by Assistant United States Attorney Jeffrey Gallant.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006, by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. For more information about Project Safe Childhood and Internet safety education, visit www.usdoj.gov/psc.
Florida Doctor Sentenced for Federal Tax CrimesRead the Press Release
Dr. Patricia Lynn Hough, of Englewood, Florida, was sentenced today to serve two years in prison and three years supervised release by U.S. District Court Judge John Steele in Fort Myers, Florida, for conspiring to defraud the Internal Revenue Service (IRS) by concealing millions of dollars in assets and income in offshore bank accounts at UBS and other foreign banks, and for filing false individual income tax returns which failed to report the existence of those foreign accounts or the income earned in those accounts, the Justice Department and the IRS announced. Hough was also ordered to pay $15,518,382 in restitution and $42,732.27 for the costs of prosecution . Hough was convicted by a jury on Oct. 24, 2013.
According to court documents and court proceedings, Hough owned two Caribbean-based medical schools, Saba University School of Medicine located in Saba, Netherlands Antilles, and Medical University of the Americas located in Nevis, West Indies. Hough conspired to defraud the IRS with her husband, Dr. David Fredrick, who is awaiting trial. They carried out the conspiracy by creating and using nominee entities, including a foundation, and by using undeclared accounts in their names and the names of nominee entities at UBS and other foreign banks to conceal assets and income from the IRS. Both schools and the associated real estate were sold on April 3, 2007, for more than $35 million, all of which was deposited into undeclared accounts in the names of the nominee entities. The majority of the proceeds from the sale were not reported to the IRS on their tax returns and no tax was paid. In total, between 2003 and 2008, Hough and Fredrick failed to pay more than $15 million in taxes.
The evidence at trial further proved that Hough and Fredrick used emails, telephone calls and in-person meetings to instruct Swiss bankers and asset managers to make investments and transfer funds from their undeclared accounts at UBS. The evidence also established that Hough and Fredrick caused funds from the undeclared accounts in the names of the medical schools to be transferred to undeclared accounts in their individual names or in the names of nominee entities. Hough and her husband then used the funds in their undeclared accounts to purchase an airplane, two homes in North Carolina and a condominium in Sarasota, Florida.
Hough was also convicted of three counts of filing false tax returns for 2005, 2007 and 2008. The evidence at trial showed that Hough filed false tax returns that substantially understated her total income because she failed to report substantial interest and investment income and because she failed to report her half of the proceeds from the sale of the medical schools in 2007. In addition, Hough failed to report that she had an interest in, or signature or other authority over, bank, securities or other financial accounts located in foreign countries.
U.S. citizens who have an interest in, or signature or other authority over, a financial account in a foreign country with assets in excess of $10,000 are required to disclose the existence of such accounts on Schedule B, Part III, of their individual income tax returns. Additionally, U.S. citizens must file a Report of Foreign Bank and Financial Accounts (FBAR) with the U.S. Treasury disclosing any financial account in a foreign country with assets in excess of $10,000 in which they have a financial interest, or over which they have signature or other authority.
“The Justice Department is committed to investigating and prosecuting those who continue to evade taxes by hiding income and assets in undisclosed offshore bank accounts,” said Assistant Attorney General Kathryn Keneally for the Tax Division. “As this sentence shows, those who fail to come into compliance risk high penalties and jail.”
“Those who use nominee entities to conceal their assets and income in offshore accounts should realize by now that no bank offering such services will be a safe haven from the IRS,” said Chief of IRS-Criminal Investigation Richard Weber. “Regardless of wealth, everyone must pay taxes on all of their income, not just the amount they choose to report. It is more important that the American people feel confident that everyone is playing by the same rules and paying their taxes. Today, Dr. Hough has been held accountable for using an intricate network of financial transactions to evade her tax obligation.”This case was prosecuted by Trial Attorneys Caryn Finley and Leigh Kessler of the Tax Division and was investigated by IRS – Criminal Investigation. Assistant Attorney General Keneally thanks them for their work, and also thanks the U.S. Attorney’s Office for the Middle District of Florida, Fort Myers Division, for their assistance and support in the prosecution.
Additional information about the Tax Division and its enforcement efforts may be found at the division website.Federal Charges Filed Against 22 Alleged Members of Related Camden Drug Trafficking OrganizationsRead the Press Release
NOTE: The press release below was originally issued Wednesday, May 7, 2014. The complaints on which it was based misidentified Bryan Falu of Philadelphia as one of the defendants. Charges against Bryan Falu have been dismissed and he is not being sought by law enforcement. The criminal complaint on which the original press release was based, and this press release, have been amended.
Camden’s C-4 Anti-Violence Team Arrests 16 in Coordinated Takedown
CAMDEN, N.J. – This morning, teams of federal, state and local law enforcement partners led by the FBI arrested 16 members of related drug trafficking organizations – bound by family and narcotics business relationships – that processed and distributed crack, powder cocaine and heroin on the streets of Camden County, U.S. Attorney Paul J. Fishman announced.
Based on criminal charges filed by the U.S. Attorney’s Office and executed through the cooperative work of the Camden County Crime Collaboration, or C-4, the arrests targeted a group of interconnected drug trafficking organizations (DTOs) operating primarily in the Whitman Park section of Camden. The complaints unsealed today charge 21 defendants in two separate DTOs: one allegedly led by Efraim Rivera (the Rivera DTO), and the second involving two groups run by the Roldan and Ramos families – allegedly led by cousins Raymond Roldan and Jerome “Ant” Ramos – operated cooperatively on Sheridan Street as one organization (the Sheridan Street DTO).
In addition to the 16 defendants arrested today, two of the charged individuals, Dewayne Jackson and Mark Washington, were already in custody on state charges. Three more are being sought by law enforcement. Those arrested today are expected to appear this afternoon before U.S. Magistrate Judge Anne Marie Donio in Camden federal court.
“According to the charges, these individuals turned entire city blocks into distribution centers for narcotics,” said U.S. Attorney Fishman. “Relying on the bond of blood ties, they allegedly operated drug trafficking businesses as a family affair, sharing suppliers and street dealers in Camden and throughout South Jersey. Law enforcement is collectively committed to improving the quality of life of the people who live in these neighborhoods, who deserve freedom from drug trafficking and related violence.”
“This is the largest FBI takedown in Camden in a decade,” said Edward J. Hanko, Special Agent in Charge of the FBI’s Philadelphia Division, “and we’re not done yet. The FBI’s South Jersey Violent Offender and Gang Task Force, aided by our outstanding law enforcement partners, is committed to dismantling the violent drug gangs poisoning Camden’s streets.”
According to documents filed in this case and statements made in court:
In addition to providing drugs to distributors on Sheridan Street, the DTOs together controlled or supplied numerous drug distribution groups, or “sets,” throughout Camden with powder cocaine, crack and – through the Ramos group – heroin. They also supplied other narcotics distributors, who sold the DTOs’ drugs throughout Camden County, including in Lindenwold, Sicklerville and Gloucester City.
Many of the DTOs’ members are relatives, and the Roldan and Ramos groups live in close proximity to one another on Sheridan Street. While the Roldan and Ramos groups each ran their own open-air drug sets along three blocks of Sheridan Street, they shared territory, set workers and suppliers, and used the same locations to process powder cocaine into crack cocaine.
An investigation led by the FBI used surveillance, confidential informants and cooperating witnesses, controlled drug purchases, record checks and telephone wiretaps to uncover the distribution networks.
Just during the time period of the wiretap – from Dec. 4, 2013 to March 4, 2014 – the Rivera DTO trafficked at least 225 ounces and the Sheridan Street DTO trafficked more than 50 ounces of powder cocaine. During the same period, the Rivera DTO trafficked approximately 24 ounces of crack. The Sheridan Street DTO sold more than 36 ounces of crack during a similar time frame – ending April 16, 2014 – during which the Ramos group also trafficked a minimum 325 grams of heroin, making approximately $1,800 a day on heroin alone.
“It is the continuing cooperative efforts of federal, state and county law enforcement agencies that have had a significant impact on the crime rate in Camden and made the city a safer place for its citizens, “said Camden County Prosecutor Warren Faulk. “Today’s arrests are just a part of these continuing efforts.”
“The Camden County Crime Collaboration is a collaboration of law enforcement agencies leveraging resources and intelligence to remove the most violent drug gang organizations from the streets in our region,” said Camden County Police Chief J. Scott Thomson. “Today’s arrest signals the end to a drug gang that has influenced violence in the Whitman Park neighborhood, one of Camden’s most challenged sections with gun violence. I am extremely grateful to the leadership of the U.S. Attorney’s Office of New Jersey for their stewardship of our C-4 efforts.”The Rivera DTO acquired and distributed powder cocaine to the Sheridan Street DTO, which then processed the powder into crack for sale at open-air drug sets it controlled. The DTOs maintained various stash houses; rented cars to conduct drug-related business; moved around different locations to manufacture crack; and employed coded language when conducting drug business by phone or text messaging.
Efraim Rivera primarily operated the Rivera DTO from his mother’s residence on Liberty Street in Camden, taking telephone orders for both powder and crack cocaine. He regularly travelled to Philadelphia, sometimes as often as three times a week, to purchase multiple-ounce quantities of cocaine from an uncharged conspirator who was Rivera’s source of supply. The Rivera DTO then sold the powder cocaine to the Sheridan Street DTO and to other customers. Some of the Rivera DTO’s customers then supplied powder or crack to Dymiere Demby, Dewayne Jackson and Daniel Alston for sets at 10th and Warsaw Streets, Green and Mechanic Streets, and Lindenwold, respectively.
The Sheridan Street DTO would then convert the powder cocaine to crack, which would be sold on the open-air drug markets respectively controlled by the Roldan and Ramos groups, or to other drug distributors, who supplied other drug traffickers or sets in and beyond the city of Camden. The Rivera DTO would purchase Sheridan Street DTO crack made from the same cocaine it sold to the Roldan group. Rivera’s DTO crack customers included Rivera’s relatives, Angel “Jungo” Garcia and Angel Velez, who would redistribute the crack.
When Raymond Roland was unable to obtain powder cocaine from the Rivera DTO, he turned to other suppliers, such as Luis “Canelo” Diaz, who also supplied the Rivera DTO. Roldan worked closely with his cousin “Ant” Ramos. The two maintained regular contact and reached out to each other when attempting to locate sources of supply. Roldan was assisted in the day-to-day operation of his group by his sister, Daisy Roldan, and her son, Anthony “Boo Boo” Esprit, who facilitated meetings with suppliers and customers, transported narcotics and collected drug proceeds.
“Ant” Ramos was assisted by his brothers Giovanny “Gio” Ramos and Alexsio “Al” Ramos, who, along with Jimmy Mercado, “cooked” the crack and processed the powder cocaine, crack cocaine and heroin for sale. Intercepted telephone conversations captured the coordination among the Ramos group members as they discussed materials including ammonia, sandwich bags, masks and grinders.
The Roldan and Ramos groups shared set workers, such as Christian Setzer and Graciano “Rocky” Diaz, who made walk-up sales on Sheridan Street.
Calls were intercepted between Sheridan Street DTO members referring to being armed with guns and having a “strap” or gun on their person. One DTO member stated, “at the end of the day, I’m shooting.” One DTO member stated in an intercepted conversation that he had just come from the gun range.
The defendants involved with the Rivera DTO each are charged with one count of conspiracy to distribute and to possess with intent to distribute 280 grams or more of crack and 5 kilograms or more of cocaine; the members of the Sheridan Street DTO each are charged with one count of conspiracy to distribute 280 grams or more of crack; 500 grams or more of cocaine; and 100 grams or more of heroin. Raymond Roldan, Luis Diaz and Efraim Rivera each are charged with both counts. Each count carries a minimum potential penalty of 10 years in prison and a maximum potential penalty of life in prison and a $10 million fine.
U.S. Attorney Fishman credited special agents of the FBI’s Philadelphia Division and the South Jersey Violent Offender and Gang Task Force, under the direction of FBI Special Agent in Charge Hanko; the Camden County Prosecutor’s Office, under the direction of Prosecutor Faulk; and the Camden County Police Department – Metro, under the direction of Chief Scott Thomson, with the investigation – as well as the Camden County Sheriff’s Office, under the direction of Sheriff Charles Billingham; the New Jersey State Police, under the direction of Col. Rick Fuentes; and the Gloucester County Prosecutor’s Office, under the direction of Prosecutor Sean Dalton. He also thanked other members of C-4, the Philadelphia/Camden High Intensity Drug Trafficking Area program and the New Jersey Division of Criminal Justice for their roles in the case.
The government is represented by Special Assistant U.S. Attorney Ira M. Slovin of the
U.S. Attorney’s Office Criminal Division in Camden.The charges and allegations contained in the complaints are merely accusations, and the defendants are considered innocent unless and until proven guilty.
This case was developed through the work of C-4. Every federal, state and local law enforcement agency and prosecutor’s office responsible for combating drug trafficking, gang activity and violent crime in Camden has come together in one location to share intelligence, develop strategies and support the investigative and prosecutorial efforts of its partners. C-4 has merged the individual missions of the various law enforcement agencies into a single strategic attack on drug trafficking and drug-related violent crime. Such intense coordination greatly enhances the law enforcement community’s ability to correctly identify and successfully prosecute the most dangerous criminals in one of our nation’s most dangerous cities.
Name
Age
Residence
Alleged Role
33
Camden
Leader, Rivera DTO
Supplier,
Sheridan Street DTORaymond Roldan
38
Camden
Leader, Roldan group
Supplier, Rivera DTOJerome Anthony Ramos,
aka “Ant”28
Camden
Leader, Ramos group
Uncharged conspirator
Supplier, Rivera DTO
Luis Diaz,
aka “Canelo”42
Camden
Supplier, Rivera DTO
Supplier,
Sheridan Street DTORamon Diaz,
aka “Paluco”44
Camden
Facilitator,
Sheridan Street DTODaisy Roldan
36
Camden
Facilitator, Roldan group
Anthony Esprit,
aka “Boo Boo”18
Camden
Facilitator, Roldan group
Alexsio Ramos,
aka “Al”25
Camden
Facilitator, Ramos group
Giovanny Ramos,
aka “G”20
Camden
Facilitator, Ramos group
Jimmy Mercado,
aka “J.I.”26
Camden
Facilitator, Ramos group
Christian Setzer.
aka “Hitstick”33
Camden
Set Worker,
Roldan and Ramos groupsGraciano Diaz,
aka “Rocky”26
Camden
Set Worker,
Roldan and Ramos groupsAngel Garcia,
aka “Jungo”36
Camden
Customer/Redistributor,
Rivera DTOAli Alexander,
aka “Ali Al”35
Camden
Customer/Redistributor,
Rivera DTOAngel Velez
32
Camden
Customer/Redistributor,
Rivera DTODaniel Alston,
aka “Boo”33
Camden
Customer/Redistributor,
Rivera DTODymiere Demby
23
Camden
Customer/Redistributor,
Rivera DTOGiovanny Carrero
34
Camden
Customer/Redistributor,
Rivera DTODewayne Jackson
45
Camden
Customer/Redistributor,
Rivera DTOMark Washington,
aka “Burger”, aka “BG”27
Camden
Customer/Redistributor,
Ramos groupEric Rivera,
aka “E”27
Camden
Customer/Redistributor,
Ramos group14-156
Rivera, Efraim et al Revised Complaint
Dryden Man Sentenced to Imprisonment for Defrauding Social Security AdministrationRead the Press Release
ABINGDON, VIRGINIA – United States Attorney Timothy J. Heaphy announced today that Phillip Reece, 47, of Dryden, Va., was sentenced to six months imprisonment in the United States District Court for the Western District of Virginia in Abingdon. Phillip Reece previously pled guilty to one count of converting the social security benefits payments of another to his own use.
According to evidence presented at the sentencing and guilty plea hearings by Assistant United States Attorney Zachary T. Lee, between 1999 and 2011, Phillip Reece was the third party payee for his three children’s Social Security Survivor Benefits and was required to use those benefit payments for the care and support of his three children. An investigation by the Social Security Administration’s Department of Inspector General discovered that Phillip Reece falsified multiple Social Security Administration documents claiming his three children resided with him during this timeframe, when in actuality they resided with their grandparents. Additionally, Phillip Reece did not use any of the Social Security Benefits for the support and care of his three children and unlawfully used $91,336 of his children’s Social Security Survivor Benefits for his own personal expenses.
The investigation of this case was conducted by Social Security Administration’s Department of Inspector General. Assistant United States Attorney Zachary T. Lee is prosecuting the case for the United States.
District Man Found Guilty of Robbing Restaurant at Gunpoint and Obstructing Justice After His Arrest-Defendant Was A Manager at the Restaurant He Targeted-Read the Press Release
WASHINGTON – Torrey C. Robinson, 26, of Washington, D.C., has been found guilty by a jury of robbery and other charges in the hold-up of a Northwest Washington restaurant where he was employed as a manager, U.S. Attorney Ronald C. Machen Jr. announced.
Robinson was found guilty on May 8, 2014, following a trial in the Superior Court of the District of Columbia, of robbery, burglary, obstruction of justice, and unlawful possession of ammunition. The Honorable Robert I. Richter scheduled sentencing for July 9, 2014.
According to the government’s evidence, on Nov. 26, 2013, Robinson worked the day shift as a manager at Taylor Gourmet, located in the 600 block of E Street NW. He was replaced that afternoon by the victim, a new female manager set to work her first night shift alone that evening. At about 9:05 p.m., just after the restaurant had closed, Robinson returned to the establishment, wearing black Helly Hansen pants with reflective striping, a black North Face jacket with the hood up, a ski mask, and black-and-gray gloves.
Upon entering the restaurant, Robinson turned off the lights and approached the victim, who was working behind the counter. Robinson opened his jacket, displayed a dark-colored gun in his waistband, and told the victim, “This is a robbery, this is not a game.” He commanded her to open the safe. When the victim did not do so, Robinson consulted a clipboard containing the safe combination – which was hidden in code – and opened the safe himself, taking nearly $2,000 in cash, as well as multiple rolls of quarters wrapped in orange-and-white paper.
Senior staff at Taylor Gourmet later reviewed a surveillance video and immediately believed that the robber was Robinson, a manager at that location. Pursuant to a search warrant, police found the black Helly Hansen pants with reflective striping worn during the robbery in Robinson’s room, along with nearly $950 in various denominations, including 100 in $1 bills, and one roll of quarters wrapped in orange-and-white paper. Also found in the room was a box of 9 mm ammunition. In a search of Robinson’s car, police found the black-and-gray gloves worn during the robbery, along with four more rolls of quarters wrapped in orange-and-white paper. Additionally, police searched Robinson’s iPhone and found photos and a video of him holding a thick wad of cash the night after the robbery. Text messages recovered from Robinson’s cell phone proved that he was in the area of the robbery; he texted a friend that he was arriving at a store just two blocks away, minutes after the crime.
When he picked his friend up at the store, Robinson was wearing the black pants with reflective striping. Finally, in the weeks after his arrest, Robinson made multiple telephone calls from the District of Columbia Jail in which he solicited various friends and family members to move his gun, which he called “Baby Girl.” In one such call, Robinson learned that the gun had been successfully moved.
In announcing the verdict, U.S. Attorney Machen commended the work of the Metropolitan Police Department (MPD), which investigated the case. He also expressed appreciation for the assistance provided by the FBI’s Cellular Analysis Survey Team and the District of Columbia Department of Forensic Sciences. He acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Criminal Investigators John Marsh and Nelson Rhone, Paralegal Specialist Todd McClelland, and Assistant U.S. Attorney James A. Petkun, who investigated, indicted, and tried the case to verdict.
14-108Crack Cocaine Dealer SentencedRead the Press Release
Michael J. Moore, United States Attorney for the Middle District of Georgia, announced that Javaris Bloodser, age 33, of Forsyth, Georgia, was sentenced on May 8, 2014, to 13 years in federal prison. Mr. Bloodser had previously entered a guilty plea to possession with intent to distribute crack cocaine. As part of the written plea agreement, Mr. Bloodser stipulated that on June 5, 2013, he was a passenger in a car which was stopped for a traffic violation in Forsyth. After Mr. Bloodser exited the vehicle, officers found a small quantity of marijuana in his pocket. Mr. Bloodser was detained and placed in the rear of a patrol vehicle. After he had been placed in the car, officers noticed that Mr. Bloodser appeared to be making suspicious movements inside the vehicle. One of the officers approached Mr. Bloodser and found him attempting to hide 29 grams of crack between the seats.The investigation was conducted by agents from the GBI and officers from the Monroe County Sheriff’s Office. Assistant United States Attorney Charles L. Calhoun appeared on behalf of the Government.
“This defendant, an admitted crack cocaine distributor, is off our streets because of the great cooperation between local, state and federal law enforcement. The truth that Mr. Bloodser now realizes - and what any other drug dealers should learn - is that if you deal drugs in Middle Georgia, you are going to end up in jail,” said U.S. Attorney Michael Moore.
Inquiries regarding the case should be directed to Pamela Lightsey, United States Attorney's Office at (478) 621-2603.
Columbus Clothing Store Operator Indicted for Allegedly Selling Counterfeit MerchandiseRead the Press Release
CONTACT: Fred Alverson
Public Affairs Officer
COLUMBUS, Ohio – A federal grand jury has indicted Rami Hisham Mohammad, 33, of Hilliard, Ohio, charging him with trafficking in counterfeit goods or services for conspiring to obtain and sell allegedly counterfeit apparel, jewelry and DVDs from his business, Rock Star Fashions.
Carter M. Stewart, United States Attorney for the Southern District of Ohio and Marlon V. Miller, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) announced the indictment today.
The indictment alleges that Mohammad conspired with others between December 2008 and January 2012 to obtain shipments and/or truckloads of clothing, purses, jewelry and shoes bearing counterfeit marks including Nike, Timberland, Polo/Ralph Lauren, Coach, Louis Vuitton, Ugg, Ed Hardy, Gucci and True Religion brand apparel. Mohammad also is alleged to have concealed the majority of the counterfeit merchandise in an adjoining warehouse space that was accessed through a disguised doorway behind a mirror in a bathroom that opened into a storage area.
During the execution of a search warrant in January 2012, investigators seized more than 5,400 pairs of counterfeit Nike shoes, more than 200 counterfeit Coach purses, as well as jeans, watches, sunglasses, wallets, and NY Yankees ski caps.
Mohammad allegedly sold the merchandise at prices well below the retail price of legitimate merchandise. Mohammad also allegedly sold bootleg movie DVDs at the store. U.S. Attorney Stewart said the investigation continues into how Mohammad obtained the counterfeit items.
The indictment charges Mohammad with one count of conspiracy and five counts of trafficking in counterfeit goods. Each count is punishable by up to ten years in prison. The indictment also seeks forfeiture of all proceeds of the crimes and property used to facilitate the crime.
U.S. District Judge James L. Graham will issue a summons for Mohammad to appear in federal court.U.S. Attorney Stewart commended the investigation of this case by HSI and the Columbus Police, and Assistant U.S. Attorney Deborah A. Solove, who is prosecuting the case.
An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.
City Dispatcher and Three Tow Truck Operators Charged in Bribery ConspiracyRead the Press Release
PHILADELPHIA – An indictment was unsealed yesterday charging four people, including a Philadelphia Police Department (“PPD”) dispatcher, in a conspiracy to give an unfair advantage to certain tow truck operators in exchange for bribes, announced United States Attorney Zane David Memeger. Dorian Parsley, 44, of Philadelphia, Stepfon Flowers, 24, of Philadelphia, William Cheeseman, 42, of Delran, NJ, and Chad Harris, 22, of Philadelphia, are charged with conspiracy and bribery. Parsley, who was the dispatcher, and Flowers, are also charged with honest services fraud.
According to the indictment, between February 2011 and December 2013, Parsley used her position as a civilian radio dispatcher to provide confidential police information, such as locations of automobile accidents, locations of PPD squad cars, and vehicle registration information, to tow truck operators who provided her with cash bribe payments. Stepfon Flowers, who worked for K&B Autocraft in Philadelphia, allegedly paid Parsley $100 to $150, weekly, for the confidential information.
In September 2012, the indictment alleges, Flowers connected William Cheeseman, an owner of K&B Auto Body, with Parsley so that Cheeseman could also receive the confidential police information in exchange for cash bribe payments. In April 2013, Chad Harris, a tow truck driver for K&B Auto Body, also received Parsley’s contact information allegedly for the same purpose. According to the indictment, Parsley would surreptitiously text information that came into PPD dispatch from her personal cellphone directly to those tow truck operators. For an additional cash fee, Parsley allegedly agreed to provide certain tow truck operators with the name and address of a vehicle owner by running the license plate and vehicle registration through the PPD dispatch computer. PPD computers automatically access the National Crime Information Center (“NCIC”) located in West Virginia when a vehicle registration was inputted.
Flowers allegedly collected some of the weekly bribe payments for Parsley.
The case was investigated by the Federal Bureau of Investigation and the Philadelphia Police Department. It is being prosecuted by Assistant United States Attorney Jennifer Chun Barry.
Click here to view the indictment
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Cedar Rapids Felon Sentenced to Ten Years' Imprisonment for Possession of A Stolen HandgunRead the Press Release
A convicted drug felon who was found in possession of a stolen firearm was sentenced today to ten years in federal prison. Joseph Griffin-Cooke, age29, from Cedar Rapids, Iowa, received the prison term after a February 6, 2014, guilty plea to one count of being a felon in possession of a firearm and ammunition.
In a plea agreement, Griffin-Cooke admitted that police approached him on October 2, 2013, at 4:00 am when they saw him driving in a suspicious manner in a neighborhood. Griffin-Cooke refused to cooperate with officers, then began reaching under the seat of the car in which he was sitting. Officers restrained Griffin-Cooke after a struggle in which one officer was injured. In the car, near the area where Griffin-Cooke was reaching, officers found a stolen, loaded .380 caliber pistol, marijuana packaged for sale, and cash. Griffin-Cooke was barred from possessing a firearm because he was a felon, having been convicted in 2007 in the Iowa District Court for Linn County of delivery of crack cocaine.
Griffin-Cooke was sentenced in Cedar Rapids by United States District Court Chief Judge Linda R. Reade. Griffin-Cooke was sentenced to the statutory maximum sentence of 120 months’ imprisonment. The court based the sentence, in part, upon Griffin-Cooke’s serious criminal history which included multiple violent assaults. A special assessment of $100 was imposed. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system. Griffin-Cooke is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney C.J. Williams and was investigated by the Cedar Rapids Police Department, the Federal Bureau of Investigation, and the Bureau of Alcohol, Tobacco, Firearms and Explosives. This case was a result of the Cedar Rapids Safe Streets Task Force and was in furtherance of the Project Safe Neighborhoods initiative.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 13-cr-90.
California Sub-Contractor Pleads Guilty to Fraud Involving Boeing ContractsRead the Press Release
St. Louis, MO – WILLIAM BOOZER, a Boeing sub-contractor, pled guilty to wire fraud in connection with a bribery/kickback scheme involving Boeing military aircraft parts during November 2009 through February 2013.
Globe Dynamics International, Inc., Santa Ana, California, is a leader in producing small to large, close tolerance precision machined parts and the assembly of complex components. Globe Dynamics was a sub-contractor to Boeing on numerous United States government contracts. William Boozer, owner and operator of Globe Dynamics, directed the day-to-day operations of the company, including the submission of contract bids.
According to Boozer’s plea agreement, between November 2009 and February 2013, Boozer requested the Procurement Officer for Boeing, Deon Anderson, provide him with non-public competitor bid information and historical price information in connection with Boeing military aircraft part purchase order requests for quotes. They communicated by telephone and e-mail between California and St. Louis in code on a regular basis, Boozer frequently requesting “Isle 5," a coded reference to a “price check on aisle 5," understood by Anderson to be a request for historical price information and competitor bid information. Anderson gave the information to Boozer to be used in preparing and submitting bids on behalf of Globe Dynamics in response to approximately sixteen different Boeing requests for quotes relative to those various purchase orders, in exchange for cash payments. Of the sixteen bids, Globe Dynamics was awarded seven purchase orders to supply United States military aircraft parts to Boeing totaling in excess of $1,500,000. The net benefit to Globe Dynamics on those seven purchase orders was approximately $116,339
Boozer, Hacienda Heights,CA, pled guilty to one felony count of wire fraud before United States District Judge Henry Autrey. Sentencing has been set for August 15, 2014.
Wire fraud carries a maximum penalty of 20 years in prison and/or fines up to $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
The following co-defendants were indicted on related charges and are facing trial:
- DEON ANDERSON, St. Louis, Missouri
- JEFFREY LAVELLE, Mukilteo, Washington
- ROBERT DIAZ, JR., Alta Loma, California
This case was investigated by Defense Criminal Investigative Service, Federal Bureau of Investigation, NASA-Office of Inspector General, Air Force Office of Special Investigations, Navy Criminal Investigative Service and Internal Revenue Service Criminal Investigation. Assistant United States Attorney Hal Goldsmith is handling the case for the U.S. Attorney’s Office.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. The remaining defendants are presumed to be innocent unless and until proven guilty.
Byron Center Man Guilty of $46,000,000 Investment FraudRead the Press Release
GRAND RAPIDS, MICHIGAN – U.S. Attorney for the Western District of Michigan Patrick Miles announced today that David W. McQueen, age 43, of Byron Center, Michigan, was convicted of six counts of mail fraud, six counts of money laundering and three tax counts stemming from a $46,000,000 Ponzi scheme that spanned three years. He was acquitted of one fraud count and two money laundering counts. The scheme affected more than 800 families, and preyed upon unsophisticated, often elderly investors. He faces up to 20 years on each fraud count, up to 20 years on some of the money laundering counts (up to 10 years on others) and one year on each tax count.
The evidence at trial showed that, as with many investment frauds, McQueen likely did not set out to create a criminal enterprise that would result in a financial tragedy for his investors. In 2006, McQueen, who made an adequate living in sales, used borrowed funds to invest in a company called Multiple Return Transactions (“MRT”). MRT was owned and operated by Jim Clements. Clements promised returns of 10% per month or higher to McQueen. After a few months of making such returns, McQueen decided to capitalize on his apparent investment success and invited others to invest through him. McQueen created a company called Accelerated Income Group (“AIG”), through which he promised returns as high as 5-6% to investors. In addition, McQueen recruited insurance agents to sell his investments to their clients. For a short time, AIG was very successful (at least on paper). McQueen used MRT’s promised returns of 10%, to make AIG’s promised returns of 5%. McQueen could meet his 5% obligations to his investors and then keep 5% for himself.
In mid-2007, MRT stopped making payments and meeting redemption requests. MRT was merely a Ponzi scheme, and their money was gone and would never be recovered. Instead of notifying AIG investors that MRT had failed, however, McQueen continued to tell investors that their money was safe and growing. Without MRT making its monthly payments, McQueen and AIG could not meet their 5% monthly obligations to investors based on investment earnings. Instead, McQueen used the only funds he had available to make promised interest payments – money from new investors.
Instead of shutting down AIG, or at least notifying his investors of MRT’s cessation of interest payments, McQueen falsely touted his investment success and raised millions of dollars of additional money. In addition to AIG, McQueen created three other funds, International Opportunity Consultants (“IOC”), Diversified Liquid Asset Holdings (“DLAH”) and Diversified Global Finance (“DGF”), that were nothing more than sham corporations designed to raise millions of dollars from investors. McQueen commingled the investor money between his various and purportedly distinct funds and used it to make bogus interest payments and redemption requests to investors, pay commissions to agents that sold the funds on McQueen’s behalf, or simply spend the money. Despite knowing that he had absolutely no revenue coming in, McQueen took $100,000 of investor money per month tax free for his own personal use and enjoyment.
Recognizing that his scheme would collapse without actual investment success, McQueen placed approximately 30% of the investor funds in a series of highly speculative investments or scams. Unsurprisingly, this effort did not generate significant returns, and many lost all of the funds invested.
To perpetuate his fraud, McQueen sent out monthly or quarterly account statements communicating to investors that their investments were safe and growing. Investors relied on those account statements and believed they accurately depicted the balance in their accounts. McQueen promised investors that they could liquidate their accounts at any time, but most did not because they believed that their account statements were accurate and that they had made a solid investment. In July and August 2009, McQueen sent out his final account statements showing that investors had tens of millions of dollars safe and growing in their “separate accounts.” Those statements concealed the truth – that McQueen had nearly run out of money.On August 24, 2009, the IRS and FBI executed search and seizure warrants signed by Magistrate Hugh W. Brenneman. The government seized approximately $430,000 from McQueen’s accounts. Unbeknownst to the government, McQueen later brought the remaining investor funds (approximately $440,000) back from an account located in New Zealand and used it for personal expenses and to make some last ditch investments, which failed.
After the jury rendered their verdict, Defendant McQueen was remanded to the custody of the U.S. Marshals Service. A sentencing date has not been set.
This case was investigated by the IRS and FBI and prosecuted by Assistant U.S. Attorneys Matthew G. Borgula, Sally J. Berens and Heath Lynch and Securities and Exchange Commission Trial Attorney Timothy Leiman.
END
Buffalo Man Sentenced on Child Pornography ChargesRead the Press Release
BUFFALO, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that Daniel Cay, 26, of Buffalo, N.Y., who was convicted of possession of child pornography, was sentenced to 10 years in prison by U.S. District Court Judge Richard J. Arcara.
Assistant U.S. Attorney Michael DiGiacomo, who handled the case, stated that the Buffalo Police Department received information that the defendant possessed child pornography on a computer. Cay was subsequently arrested in January of 2013. A forensic examination of the computer revealed over 300 images of child pornography. Some of the images depicted violence against children.
The defendant was previously convicted in 2006 for Sexual Assault of a Minor 2nd Degree in Connecticut.
The sentencing is the culmination of an investigation on the part of Special Agents of the Federal Bureau of Investigation and the Buffalo Police Department, under the direction of Commissioner Daniel Derenda.Biloxi Woman Sentenced for Oil Spill FraudRead the Press Release
Gulfport, Miss. – Brandy Ann Jarrell, 38, of Biloxi, Mississippi, was sentenced by U. S. District Judge Sul Ozerden to six months in federal prison and six months home confinement with electronic monitoring followed by three years of supervised release for oil spill fraud, announced U.S. Attorney Gregory K. Davis. Jarrell was also ordered to pay $28,800 in restitution and perform eighty hours of community service.
Jarrell knowingly devised and carried out a scheme to defraud the Gulf Coast Claims Facility which was established by BP Exploration and Production to administer, process, and settle certain claims of individuals and businesses that had been impacted by the Deepwater Horizon Oil Spill. Jarrell submitted a fraudulent claim for damages by alleging that she lost earnings, profits and work hours as an oyster and shrimp fisherman working in Gulf Coast harbors as a result of the oil spill. Jarrell received a check in the amount of $28,800.00 as the result of her false claim.
This case was investigated by the U.S. Postal Inspection Service and prosecuted by Assistant U.S. Attorney Andrea Jones.
This case was brought as part of this District’s partnership with the National Center for Disaster Fraud (NCDF), a nationwide initiative to protect available funds and assistance for those victims of both natural and man-made disasters such as hurricanes, floods, tornadoes and the recent Gulf oil spill. If you have knowledge of fraud, waste, abuse, or allegations of mismanagement involving disaster relief operations, you can contact the NCDF by either calling the hotline at (866) 720-5721, faxing (225) 334-4707, emailing at [email protected] or in writing to National Center for Disaster Fraud, Baton Rouge, LA 70821-4909.If you believe you have been a victim of fraud from a person or an organization soliciting relief funds on behalf of storm victims, contact the National Center for Disaster Fraud toll free at:
(866) 720-5721
You can also fax information to:
(225) 334-4707
or e-mail it to:
Making sure that victims of federal crimes are treated with compassion, fairness and respect.
Training and seminars for Federal, State, and Local Law Enforcement Agencies.
Help us combat the proliferation of sexual exploitation crimes against children.
Bankers and Attorney Convicted of Fraud, False Statements, and Making a False Claim Against the United StatesRead the Press Release
PANAMA CITY, FLORIDA– Late Wednesday night, a federal jury returned verdicts finding Donald Terry Dubose, a/k/a “Terry Dubose,” 66, of Panama City Beach, Florida, Elwood Ladon West, a/k/a “Woody West,” 40, of Monroeville, Alabama, and Frank Alfred Baker, 62, of Marianna, Florida, guilty of certain charges in a twelve count superseding indictment charging conspiracy to commit wire fraud, making false statements, and filing false claims against the Federal Deposit Insurance Corporation. Dubose was convicted on all twelve counts of the indictment. West was convicted on counts two through twelve of the indictment and acquitted on the first count, the conspiracy charge. Baker was convicted of the conspiracy charge and certain of the remaining wire fraud and false claim charges. The verdicts were handed down late Wednesday evening, following a trial that lasted almost three weeks.
The evidence at trial established that Coastal Community Investments (“Coastal”) was a bank holding company that owned Coastal Community Bank, based in Panama City Beach, Florida, and Bayside Savings Bank, based in Port St. Joe, Florida. Coastal Community Bank and Bayside Savings Bank both failed on July 30, 2010. Dubose was the Chairman and Chief Executive Officer of Coastal and the largest Coastal shareholder. West was the Chief Financial Officer of Coastal and a Coastal shareholder. Baker was an attorney for Coastal and was Coastal’s second largest shareholder.The case involved a fraud committed against the Government relating to the FDIC’s Temporary Liquidity Guarantee Program (TLGP), which was created at the height of the nation’s financial crisis in October 2008. The purpose of the TLGP was to encourage banks to begin lending to one another again, and thereby, help to stabilize the economy. To accomplish this, the TLGP provided that the FDIC would guarantee a loan made by one financial institution (the “lender”) to another financial institution (the “borrower”) in an amount up to 125% of the borrower’s existing unsecured debt, thus assuring repayment to the lender by the borrower or, in the event of default, by the FDIC.
The evidence at trial showed that in October 2008, Coastal had a $3,000,000 secured loan with RBC Bank (USA), which was secured by 100% of the stock of Coastal Community Bank and Bayside Savings Bank (the “RBC Loan”). At that time, the RBC Loan was in default, thus giving RBC the ability to exercise its right to take the pledged stock that secured the loan and take over Coastal Community Bank and Bayside Savings Bank. Under pressure from RBC to repay this debt, the defendants falsely certified to the FDIC that the RBC Loan was unsecured, knowing for a fact that it was instead a secured loan, so that Coastal could get an FDIC-guaranteed loan under the TLGP.
The evidence at trial established that Coastal obtained a $3,750,000 loan from central Florida-based CenterState Bank. Based on the defendants’ misrepresentations, the CenterState Bank loan was guaranteed by the FDIC under the TLGP (the “TLGP Loan”), and as provided by the program, represented 125% of the RBC Loan. Coastal used the proceeds of the TLGP Loan to repay the RBC Loan.
In June 2010, Coastal defaulted on the TLGP Loan, and on August 6, 2010, CenterState Bank filed a claim with the FDIC for payment of the full amount due on the TLGP Loan, plus interest. The FDIC paid CenterState’s claim on August 13, 2010, by wiring $3,805,833.34 in principal and interest from the FDIC to CenterState.
United States Attorney Marsh said, “These defendants – bank officers and a bank attorney – took advantage of the Temporary Liquidity Guarantee Program, which was designed to help the country avoid financial collapse, and instead used the program to enrich themselves. Such fraud committed by bank insiders against programs designed to help our citizens will not be tolerated. Not only is such conduct a breach of trust, it is harmful to our communities and our nation. My office will continue to investigate and prosecute any individual who would harm our banking system, our financial institutions, and our national economy.”
Matt Alessandrino, Assistant Inspector General for Investigations, FDIC, said, “The Federal Deposit Insurance Corporation Office of Inspector General is pleased to have joined the U.S. Attorney's Office and our law enforcement colleagues in investigating the fraud that led to these convictions today. It is particularly troubling to the FDIC OIG when bank insiders and other professionals affiliated with the bank violate the public trust and engage in activities that cause losses to the Deposit Insurance Fund or harm FDIC programs designed to restore the strength of the banking system. We are committed in our efforts to maintain integrity in our nation's banks.”
“Bank executives who commit fraud impact the safety and soundness of financial institutions,” said Mark Bialek, Inspector General of the Board of Governors of the Federal Reserve System and Consumer Financial Protection Bureau. “My office will continue its vigorous pursuit of those who undermine the Federal Reserve’s ability to carry out its supervisory responsibilities over banks and bank holding companies it regulates. I commend our agents and their federal law enforcement partners for their hard work and persistence, which ultimately led to these convictions.”
The defendants are facing a maximum of 30 years’ imprisonment on each count of conspiracy to commit wire fraud, wire fraud, and making false statements to the FDIC. Each defendant faces a maximum of five years’ imprisonment for causing the submission of CenterState Bank’s false claim against the United States.
This case was investigated by the Federal Reserve – Office of the Inspector General, the Federal Bureau of Investigation, the FDIC, and the Office of the Special Inspector General for the Troubled Asset Relief Program.The case was prosecuted by Assistant U.S. Attorney Gayle Littleton and Assistant U.S. Attorney Ryan Love, with the invaluable assistance of Federal Reserve – Office of the Inspector General Special Agent Amy Whitcomb.
Baltimore Man Exiled to 10 Years in Prison for Possessing A Gun to Engage in Drug TraffickingRead the Press Release
Baltimore, Maryland – U.S. District Catherine C. Blake sentenced Trevor Cox, age 21, of Baltimore, today to 10 years in prison followed by five years of supervised release for possession of a firearm in furtherance of a drug-trafficking crime.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Acting Special Agent in Charge William P. McMullan of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; Baltimore City State’s Attorney Gregg L. Bernstein; and Baltimore Police Commissioner Anthony W. Batts.
According to his plea agreement, on January 5, 2013, Baltimore Police officers responded to the 4000 Block of Park Heights Avenue, Baltimore, Maryland after receiving a tip that a man was carrying a handgun and displaying it to individuals in that area. Officers entered a grocery store located in the area and saw an individual matching the man’s description. The man, who was later identified as Cox, acted in a manner which led the officers to believe that Cox was armed.
The officers then quickly approached Cox to secure any possible weapons and recovered a loaded .38 caliber revolver. Further examination of the revolver showed several attempts to obliterate the serial number.
After his arrest, law enforcement overheard Cox indicate in jailhouse phone calls that he possessed the gun for his own protection while engaged in a conspiracy with others to distribute drugs.
United States Attorney Rod J. Rosenstein commended the ATF, Baltimore Police Department and Baltimore City State’s Attorney’s Office for their work in the investigation. Mr. Rosenstein thanked Special Assistant United States Attorney H. Brandis Marsh, Jr., a cross-designated Baltimore City Assistant State’s Attorney assigned to Exile cases, who prosecuted the case.
Bainbridge Island Resident Sentenced to Prison for Embezzling Nearly $150,000 from Suquamish TribeRead the Press Release
A 46-year-old Bainbridge Island woman who worked for the Suquamish Tribe in Kitsap County, was sentenced today in the U.S. District Court in Tacoma to 15 months in prison and three years of supervised release for embezzling from a tribal entity, announced U.S. Attorney Jenny A. Durkan. RENEE PEARL PELETI worked in the Suquamish Indian Tribe’s Indian Child Welfare Department for more than five years. Over that time she embezzled more than $146,496 from the tribe using fraudulent checks, vouchers and gift cards for groceries, and checks written for her own utility payments. At sentencing, U.S. District Judge Robert J. Bryan imposed $146,496 in restitution.
According to records filed in the case, the Suquamish Tribe became aware in April 2013, that benefit checks for seven clients of the Indian Child Welfare Department had been altered and cashed. The investigation revealed that PELETI, who was an Administrative Assistant in the Indian Child Welfare Department, had engaged in a lengthy embezzlement scheme. PELETI caused more than 260 fraudulent tribal checks totaling more than $90,000, to be written in the names of others which she then cashed and used for her own bills. PELETI caused 14 tribal checks to be written to Puget Sound Energy to pay more than $2,800 of her own utility bills. PELETI issued more than 125 Albertsons food vouchers that she then cashed and used for more than $36,972 in groceries for her own use. Finally, PELETI embezzled multiple vendor gift cards worth more than $11,127.
PELETI, who is a member of the Nooksack Tribe, said she took the money to pay for her own family expenses. PELETI pleaded guilty on February 14, 2014.
Tribal leaders spoke at the sentencing hearing, telling the court that the embezzlement meant that needy tribal children were denied money for food, clothing, sports equipment, or Christmas presents. The speakers noted that because of the theft, these vulnerable children had missed opportunities for fun or education that would not come again.
The case was investigated by the Suquamish Police and the FBI. The case was prosecuted by Assistant United States Attorney J. Tate London.
Armed Bank Robber Sentenced to Serve More Than 24 Years in Federal Prison for Robbing Banks in Lubbock and Amarillo in May 2013Read the Press Release
LUBBOCK, Texas — Russell Eugene Heath, 45, of Lubbock, Texas, was sentenced today by U.S. District Judge Sam R. Cummings to serve a total of 295 months in federal prison, consecutive to his 24-month supervised release revocation, for his role in the takeover style robberies of two banks in May 2013. The announcement was made today by U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
Heath pleaded guilty in November 2013 to one count of aggravated bank robbery and one count of possessing a firearm in furtherance of a crime of violence. Co-defendant Gabriel Tenorio, 31, also of Lubbock and the getaway driver in the robberies, pleaded guilty to one count of aggravated bank robbery and was sentenced in December 2013 to 140 months in in federal prison.
Heath’s aggravated bank robbery conviction stems from the May 1, 2013, robbery of Lubbock National Bank, located at 4420 19th Street in Lubbock. At approximately 12:45 p.m., Heath, wearing a mask and gloves and carrying a firearm, entered the bank and pointed the gun at tellers, yelling at them to give him money. Heath jumped over a counter, opened a teller drawer and began stuffing money in his pockets. He then ran from the bank to a waiting vehicle driven by Tenorio.
Heath’s conviction for possessing a firearm in furtherance of a violent crime stems from the May 20, 2013, robbery of FirstBank Southwest Bank, located at 5701 SW 34th Street in Amarillo, Texas. In that robbery, Heath entered the bank carrying a short-barreled shotgun, vaulted over the teller counter and stole money. He then ran from the bank into a waiting vehicle, driven by Tenorio.
The FBI, Lubbock Police Department, Amarillo Police Department and the Lubbock County Sheriff’s Office investigated. Deputy Criminal Chief Assistant U.S. Attorney Denise Williams prosecuted.
Alleged Rizzuto Organized Crime Family Associate Sentenced to 10 Years ImprisonmentRead the Press Release
Earlier today, at the United States Courthouse in Brooklyn, New York, Alessandro Taloni, an alleged associate of the Montreal-based Rizzuto organized crime family of La Cosa Nostra, was sentenced to 10 years in prison, to be followed by 5 years of supervised release. In May 2013, Taloni pled guilty to cocaine trafficking charges contained in a superseding indictment returned on April 3, 2013. As part of his sentence, Taloni will also forfeit $2,663,191 that federal agents seized from multiple locations in California that Taloni used to store narcotics and drug proceeds.
The sentence was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, and James J. Hunt, Acting Special Agent-in-Charge of the Drug Enforcement Administration, New York (DEA).
“Taloni used his connections to powerful international organized crime groups to distribute deadly narcotics, worth tens of millions of dollars, across North America. His prosecution and sentence demonstrate this Office’s unrelenting commitment to swiftly pursuing and prosecuting transnational organized crime beyond state and national borders,” stated United States Attorney Lynch. Ms. Lynch extended her grateful appreciation to the Drug Enforcement Administration, the Anaheim Police Department, and the Beverly Hills Police Department for their work on the case. Ms. Lynch also expressed her appreciation to the Laval Police Service for their invaluable assistance during this multi-year international investigation.
DEA Acting Special Agent-in-Charge Hunt stated, “This sentencing is the end result of international, federal, local and state law enforcement’s collaboration. Law enforcement’s effort to thwart organized crime led to identifying Taloni and his associates’ international drug network that facilitated the Sinaloa Cartel’s cocaine distribution network in the United States.”
Taloni and ten members of a Montreal-based drug distribution organization affiliated with the Rizzuto and Bonanno crime families, the Hells Angels, and the Sinaloa Cartel were charged with narcotics and money laundering offenses in connection with trafficking over $1 billion worth of marijuana, cocaine, and ecstasy into the United States between 1998 and 2012. The organization transported tens of thousands of pounds of marijuana from outdoor growers in British Colombia to Montreal, Canada, and controlled numerous warehouses in and around Montreal for the manufacture of ecstasy and hydroponic marijuana. The drugs were smuggled into the United States using transportation networks run by the Hells Angels and Native American co-conspirators from the Akwesasne Mohawk Reservation along the U.S./Canadian border. Once the drugs were sold in the United States, much of it by distributors tied to the Bonanno crime family in New York, the organization used millions of dollars in drug proceeds to purchase more cocaine from the powerful Sinaloa Cartel in Mexico for exportation to and distribution in Canada. Taloni was personally sent from Montreal to Los Angeles, California, to receive those drug proceeds and to purchase cocaine from the Mexican sources and export cocaine to Canada.
During the course of the government's investigation, federal agents seized approximately $1 million in drug proceeds and 49 kilograms of cocaine from searches of Taloni's Mercedes Benz sedan, Beverly Hills residence, and a stash house operated by Taloni in Beverly Hills. Search warrants executed at other stash houses operated by the organization in the Los Angeles area resulted in the seizure of an additional 34 kilograms of cocaine and approximately $1,600,000. In total agents seized more than $10,000,000 in narcotics proceeds from the organization.
The government's case is being prosecuted by Assistant United States Attorneys Steven L. Tiscione, Gina M. Parlovecchio, Amir H. Toossi, and Tanisha Payne.
The Defendant:
ALESSANDRO TALONI
Age: 38
Alleged International Narcotics Trafficker Extradited from Honduras on Cocaine Distribution ChargesRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Alysa D. Erichs, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), Miami Field Office, and Mark R. Trouville, Special Agent in Charge, U.S. Drug Enforcement Administration (DEA), Miami Field Division, announce the extradition of Honduran citizen Carlos Arnoldo Lobo, a/k/a “Negro,” 39, from Honduras to the United States to face charges in the Southern District of Florida involving conspiracy to distribute cocaine. Carlos Arnoldo Lobo arrived in the Southern District of Florida on May 8, 2014 and will make his initial appearance today at 2:00 p.m. before U.S. Magistrate Judge Alicia Otazo-Reyes.
The charges announced today are the result of a multi-agency investigation that began in December 2009 into the drug smuggling activities operating near La Ceiba, Honduras. To date, the investigation has resulted in the indictment and conviction of numerous drug traffickers who worked for Carlos Arnoldo Lobo coordinating the smuggling of cocaine onto vessels for shipment from Panama to Honduras, then into Guatemala and beyond, including Mexico, and ultimately the United States, and working on the vessels for Carlos Arnoldo Lobo. The superseding indictment charges Carlos Arnoldo Lobo, a/k/a “Negro,” with conspiring to distribute cocaine, knowing that the cocaine would be imported into the United States, and conspiring to distribute cocaine on board a vessel subject to the jurisdiction of the United States.
The investigation revealed that Carlos Arnoldo Lobo allegedly owned and operated several dozen vessels off the eastern coast of Honduras which he outfitted to smuggle drugs, and used the vessels to transport drugs, primarily cocaine. The drugs were shipped from Colombia and Panama to Honduras, then into Guatemala and beyond, including Mexico, and ultimately the United States. Carlos Arnoldo Lobo allegedly controlled drug shipments into and out of the eastern coast of Honduras.
The conspiracy allegedly involved the distribution of more than 450 kilograms of cocaine.
U.S. Attorney Wifredo A. Ferrer stated, “The arrest and extradition of Carlos Arnoldo Lobo is the direct result of strong international cooperation with Honduran authorities. It also reflects the hard work, commitment, and perseverance of our Honduran and U.S. law enforcement partners to stem the flow of cocaine into the United States. Lobo was extradited from Honduras for his alleged involvement in the distribution of hundreds of kilos of cocaine, knowing that the cocaine would be imported into the United States. Now that Lobo has been extradited, he will stand trial in the United States for the serious crimes for which he is charged.”
“The arrest of Lobo is a significant victory. Lobo’s arrest and extradition to the U.S. has led to the dismantling of an egregious trafficking organization,” said Alysa D. Erichs, Special Agent in Charge of HSI Miami. “This case highlights the effective collaboration between HSI, DEA and our international law enforcement partners.”
DEA Special Agent in Charge Mark R. Trouville stated, “The DEA appreciates the cooperation of the Honduran law enforcement authorities in the arrest and extradition of Carlos Lobo. The DEA remains committed to working with our international counterparts to bring in the most significant drug traffickers to face justice for their crimes.”
The indictment of Carlos Arnoldo Lobo is the result of an ongoing Organized Crime Drug Enforcement Task Force (OCDETF) investigation led by HSI in conjunction with the DEA Miami Field Division. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
Mr. Ferrer commended the investigative efforts of ICE-HSI and DEA. The Justice Department’s Office of International Affairs, the ICE-HSI Attaché’s Office in Tegucigalpa, Honduras and the DEA Attaché’s in Tegucigalpa, Honduras provided significant assistance and support during the arrest and extradition of the defendants. The case is being prosecuted by Assistant U.S. Attorney Kurt K. Lunkenheimer.
An indictment is merely an accusation and a defendant is presumed innocent unless and until proven guilty.
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.
Thursday 8 May 2014
Washington, D.C. Man Sentenced for Robbing BanksRead the Press Release
Greenbelt, Maryland – Chief U.S. District Judge Deborah K. Chasanow sentenced Keith McBride, age 25, of Washington, D.C., today to 42 months in prison followed by three years of supervised release for conspiring to commit bank robbery.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; and Chief Mark A. Magaw of the Prince George’s County Police Department.
According to his plea agreement, McBride, Devontae West and Stephanie Fletcher stole vehicles to use during bank robberies, designated a co-conspirator to act as a getaway driver, wrote demand notes to present to bank tellers, used juveniles to enter the banks to demand money, used cell phones to maintain constant contact during the bank robberies and divided the proceeds of the bank robberies amongst themselves.
More specifically, on four occasions from March 13 to May 22, 2013, McBride and others, including juveniles, drove to the following bank branches where he stole a total of $9,093: TD Bank, PNC Bank and Citibank in Washington, D.C.; and SunTrust Bank in Forestville, Maryland. Also, on May 13, 2013 McBride and his conspirators drove to Capitol One Bank in Suitland, Maryland to rob the bank, but left without having obtained any money.
Devontae West, age 26, of Washington, D.C., previously pleaded guilty to his participation in the conspiracy and to possession of child pornography. West and the government have agreed that if the Court accepts the plea agreement, West will be sentenced to 12 years in prison. Chief Judge Chasanow scheduled West’s sentencing for June 16, 2014.Stephanie Fletcher, age 36, of Washington, D.C., has also pleaded guilty to her participation in the conspiracy and is scheduled to be sentenced on June 2, 2014.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc. For more information about internet safety education, please visit www.justice.gov/psc and click on the "resources" tab on the left of the page.
United States Attorney Rod J. Rosenstein commended the FBI and Prince George’s County Police Department for their work in the investigation. Mr. Rosenstein thanked Special Assistant U.S. Attorney LisaMarie Freitas and Assistant U.S. Attorney Thomas Sullivan, who prosecuted the case.
Washington State Resident Pleads Guilty to String of Bank RobberiesRead the Press Release
Follow @SDILNewsCarl F. Kieffer, 49, a resident of Spokane, Washington, pled guilty to three bank robberies on May 8, 2014, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today. One of the bank robberies charged was the robbery of the Bank of O’Fallon in O’Fallon, Illinois, on October 15, 2013. By agreement with other federal districts, Kieffer also pled guilty to robbing the Lusk State Bank in Lusk, Wyoming, in the District of Wyoming, on August 26, 2013, and robbing the Fifth Third Bank in Charlotte, Michigan, in the Western District of Missouri, on October 9, 2013. All of the bank robberies are charged in separate cases but were consolidated into a single proceeding.
On each individual case, Kieffer faces a term of in federal prison of not more than twenty (20) years, a fine up to $250,000, or both, and a term of supervised release of not more than five (5) years. Kieffer will also be ordered to pay restitution to the financial institutions for their losses. Sentencing is scheduled for September 4, 2014, in East St. Louis, Illinois. Kieffer has been held without bond since his arrest on a criminal complaint on October 16, 2013.
With respect to the Illinois case, the offense occurred on October 15, 2013, when Kieffer entered the Bank of O’Fallon, approached one of the tellers, and placed several manila envelopes on the counter in front of her. “No dye pack” and “he has a weapon” was written on one of the envelopes. Kieffer told the teller he wanted hundreds, fifties and twenties, and the money from her bottom drawer. When the teller informed Kieffer that she only had ones in her bottom drawer, Kieffer left the bank. Law enforcement officers were notified of the robbery and provided a description of the suspect. O’Fallon police officers in an unmarked police vehicle saw a car driven by a male who matched the description of the suspect and who appeared suspicious. The driver of the vehicle, later identified as Kieffer, fled from the officers when they tried to conduct a traffic stop. He began speeding and driving erratically, which almost caused at least one crash. He was also passing cars on the shoulder of a roadway and cars that were stopped at a red light. Officers lost the vehicle near Old Collinsville Road in Swansea, Illinois.
A Belleville police officer found Keiffer’s vehicle abandoned in a cornfield off of Smelting Works Road in Swansea, Illinois. Keiffer was found hiding in the cornfield. He thanked the officers for not shooting him while being escorted to the police vehicle. Inside his car was a deposit slip from the Bank of O’Fallon which had a handwritten note that read “I have a gun 100’s 50’s 20’s.” $3,330 was removed from Keiffer’s person. When the money was being removed, Kieffer stated that this was the money he got from the bank.
Kieffer also admitted robbing several other banks over a period of less than two months. A subsequent investigation revealed that, in addition to the robbery of the Bank of O’Fallon on October 15, 2013, Kieffer robbed the following banks:
Lusk State Bank, Lusk, Wyoming, on August 26, 2013 Chase Bank, Novi, Michigan, on September 5, 2013 New Carlisle Federal Savings Bank, Tipp City, Ohio, on September 13, 2013 Bank and Trust of Farmersville, Farmersville, Illinois, on September 16, 2013 Huntington National Bank, Bolivar, Ohio, on October 3, 2013 Fifth Third Bank, Charlotte, Michigan, on October 9, 2013
The Wyoming offense occurred on August 26, 2013, when Kieffer handed the teller a note written on a deposit/savings slip that read “This is a robbery, give me your money.” When the teller asked him if it was “for real,” Kieffer replied that it was and gestured toward a black bulge on his right side belt area, which the teller took to mean he had a gun. After taking the money, he also took the note and the pen he used to write the note.
In an interview with the FBI on October 15, 2013, Keiffer admitted that the Lusk State Bank was his first bank robbery.
The Fifth Third Bank robbery in Charlotte, Michigan, was also accomplished by handing a teller a manila envelope which had “I have gun. All 100’s, 50’s, 20’s. Now act normal. When done go to bathroom two min. or someone get hurt.” written on it.
The Illinois case was investigated by the O’Fallon Police Department, the Belleville Police Department, the Swansea Police Department, the Fairview Heights Police Department, the Shiloh Police Department, the St. Clair County Sheriff’s Department, the Illinois State Police, and the Federal Bureau of Investigation. In Wyoming, the case was investigated by the Lusk Police Department, the Wyoming Office of the Attorney General, Division of Criminal Investigation, and the Federal Bureau of Investigation. In Michigan, the case was investigated by the Charlotte Police Department, Michigan State Police, the Eaton County Prosecuting Attorney’s Office, and the Federal Bureau of Investigation. The case is assigned to Assistant United States Attorney Angela Scott.
Upper Ohio Valley Sexual Assault Help Center Honored by United States AttorneyRead the Press Release
1125 Chapline Street, Federal Building, Suite 3000 ● Wheeling, WV 26003
(304) 234-0100 ● Contact: Chris Zumpetta-Parr, Public Affairs SpecialistOutgoing SAHC Director Linda Reeves also honored
WHEELING, WEST VIRGINIA – The Upper Ohio Valley Sexual Assault Center
was honored this week in Wheeling for its efforts to end sexual violence. United States Attorney William J. Ihlenfeld, II recognized the Center for its thirty-five years of service to the Ohio Valley and presented the group with a 2014 United States Attorney’s Award.“The Upper Ohio Valley Sexual Assault Center is one of the most important social service organizations in our region,” said Ihlenfeld. “This group of dedicated individuals strives daily to provide healing for children, adults and families affected by sexual assault, and works to end sexual violence through counseling, education and advocacy. Thanks to the Center, victims of sexual violence have a place to go for support as they begin the very long and difficult road to recovery.”
Linda Reeves was recognized separately and was presented with a United States Attorney’s Award for her exceptional service to the Center for the past two decades, including 13 years as its executive director.
“Linda’s dedication to helping survivors is unmatched and her tireless efforts over the last twenty years have greatly improved the response to sexual assault in the Ohio Valley,” said Ihlenfeld.
The Upper Ohio Valley Sexual Assault Help Center opened in 1978 and is a non-profit organization dedicated to providing assistance to the community in dealing with the crime of sexual assault. Services include crisis intervention, advocacy, support services, individual and group counseling, and community education. The Center primarily serves Wetzel, Brooke, Marshall, Ohio and Hancock counties in West Virginia. In Ohio, Jefferson and Belmont counties are served. It does not refuse services to anyone regardless of where they reside, and all services are provided free of charge.
The Center provided direct victim services to over 1,000 children, youth, and adults in the Upper Ohio Valley in 2013. In addition, the Center provided community awareness and prevention education programs to over 2,500 children and adults on issues related to sexual violence last year.
United States Files Complaint Against Stevens-Henager College, Inc. Alleging False Claims Act Violations for Illegal RecruitingRead the Press Release
The United States has filed a complaint under the False Claims Act against Stevens-Henager College, Inc. and its owner, The Center for Excellence in Higher Education, for illegally compensating recruiters, the Department of Justice announced today. Stevens-Henager operates a chain of for-profit colleges in Idaho and Utah.
“Congress has made clear that colleges should not pay improper incentives to admissions recruiters,” said Stuart F. Delery, Assistant Attorney General for the Civil Division of the Department of Justice. “The Department of Justice and the Department of Education are working together to combat abusive recruitment practices that can harm students and result in the waste of taxpayer funds.”
In its complaint, the government alleged that the college falsely certified compliance with provisions of federal law that prohibit a university from paying incentive-based compensation to its admissions recruiters based on the number of students they recruit. Congress enacted the prohibition on such incentive compensation to curtail the enrollment of unqualified students, high student loan default rates, and the waste of student loans and grant funds.
The claims alleged by the United States were initiated by a whistleblower lawsuit filed by two former Stevens-Henager employees under the False Claims Act, which allows private citizens to file suit over false claims on behalf of the government. The act provides for the recovery of triple damages and penalties, and allows the government to intervene and take over the allegations, as it has done in this case. The whistleblower is entitled to a share of any recovery obtained in the lawsuit.
“Fighting fraud and protecting federal tax dollars from abuse is a priority for this office,” said Wendy Olson, U.S. Attorney for the District of Idaho. “The False Claims Act is an important tool for doing just that. Whistleblowers are necessary to our ongoing efforts to combat fraud, waste and abuse.”
This matter was investigated by the Commercial Litigation Branch of the Justice Department’s Civil Division, the U.S. Attorney’s Office for the District of Idaho, and the Department of Education, Office of Inspector General. The case is captioned United States ex rel. Brooks v. Stevens-Henager College, Inc., et al., Case No. 1:13-CV-00009-BLW (D. Id.). The claims asserted are allegations only, and there has been no determination of liability.This matter was investigated by the Commercial Litigation Branch of the Justice Department’s Civil Division, the U.S. Attorney’s Office for the District of Idaho, and the Department of Education, Office of Inspector General. The case is captioned United States ex rel. Brooks v. Stevens-Henager College, Inc., et al., Case No. 1:13-CV-00009-BLW (D. Id.). The claims asserted are allegations only, and there has been no determination of liability.