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Thursday 8 May 2014
United States Files Complaint Against Stevens-Henager College, Inc. Alleging <br /> 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 Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery. “The Department of Justice and the Department of Education are working together to combat unlawful 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 U.S. Attorney Wendy Olson 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.USAF Captain Indicted on Child Pornography ChargesRead the Press Release
LITTLE ROCK, AR – Christopher R. Thyer, Attorney for the Eastern District of Arkansas announced that Shane Padilla, age 30, of Jacksonville, a Captain in the United States Air Force, was indicted by a federal grand jury Wednesday, May 7, 2014,on one count of distribution of child pornography and one count of possession of child pornography.
Padilla was arrested on a Criminal Complaint, Friday, April 4, 2014. After a bail hearing Tuesday, April 8, 2014, Padilla was released from custody on the condition that he surrenders his passport and his pilot’s license. The conditions also imposed home detention. He is not allowed internet access and is to have no contact with minors.
“Having to prosecute these types of cases is always difficult,” stated Thyer. “It is even more difficult when the indictment is against a member of our armed forces sworn to protect the United States. I am committed to, and consider it one of my highest duties as United States Attorney to prosecute to the full extent of the law those, no matter their position in society, who exploit the innocence of our children.”
According to the Criminal Complaint, this investigation began in May of 2013 as part of a larger investigation conducted by Homeland Security Investigation (HSI) agents in Savannah, Georgia. Subsequently, HSI in Little Rock was notified that Padilla, a Captain in the United States Air Force stationed at the Little Rock Air Force Base, had received child Pornography at his email account. A federal search warrant was issued and data regarding Padilla’s email account was provided by Yahoo, Inc. After review of the information, the Complaint alleges that numerous email messages between May 2013 and July 2013 were found to contain images and/or videos of minors engaged in sexually explicit acts.
The United States Air Force Office of Special Investigations (AFOSI) was contacted and a military agent was assigned to participate in the investigation. A U.S. Military search warrant was issued and several electronic devices were seized from Padilla. The devices were turned over to an HSI Computer Forensics Analyst after a federal search warrant was issued for the devices. According to the Complaint, the analyst determined that over 1,000 images and 100 videos depicting minors engaged in sexually explicit acts were found on the devices. An arrest warrant was issued and Padilla was arrested April, 4, 2013.
The Indictment alleges that on or about March 27, 2013, Padilla knowingly distributed child pornography. The second charge in the Indictment alleges that from February, 2013, through March 27, 2013, Padilla possessed child pornography.
If convicted, Padilla faces not less 5 years’ imprisonment with a maximum of 20 years’ imprisonment and/or up to a $250,000 fine followed by 5 years of supervised release for the Distribution of Child Pornography charge. The possible sentence for Possession of Child Pornography is not more than 20 years’ imprisonment and/or up to a $250,000 fine followed by 5 years of supervised release.
The investigation was conducted by Homeland Security Investigations with substantial assistance from the United States Air Force Office of Special Investigations. The case is being prosecuted by Assistant United States Attorney Kristin Bryant.
The charges set forth in an Indictment are allegations. The defendant is presumed innocent until proven guilty.
US Attorney’s Visit with County Attorneys and Law Enforcement in St. CloudRead the Press Release
MINNEAPOLIS— United States Attorney Andrew M. Luger will meet with county attorneys and law enforcement officials from the central and north central regions of the state on Tuesday, May 13, 2014 in St. Cloud to discuss federal law enforcement priorities and opportunities for local, state, and federal law enforcement to work together.
Issues of regional concern will be discussed, including Mr. Luger’s focus on human trafficking as well as drug prosecutions, long a focus of federal law enforcement. Hosted by Stearns County Attorney Janelle Kendall and Stearns County Sheriff, John Sanner, the planned discussion is a law enforcement only working session to create efficiency, strengthen partnerships, and increase the effectiveness of local, state, and federal public safety resources.U.S. Attorney’s Office Announces Award RecipientsRead the Press Release
New Employee Also Recognized at Courthouse Ceremony
Baltimore, Maryland - Thirteen employees of the United States Attorney’s Office and thirteen law enforcement officers were honored today with the Office’s most prestigious awards. At a ceremony held to announce the awards this morning at the U.S. Courthouse in Baltimore, the United States Attorney also welcomed a new Assistant U.S. Attorney and other employees who have joined the Office since last year.
Former United States Attorney, Maryland U.S. District Judge Catherine C. Blake served as the keynote speaker for the event. Judge Blake was an Assistant U.S. Attorney for ten years and served as U.S. Attorney from 1985 to 1986.
“These award recipients sought justice with exceptional skill and dedication,” commented U.S. Attorney Rod J. Rosenstein. “As the U.S. Attorney’s Office works with our partners in local, state and federal law enforcement to promote the rule of law, punish criminals, deter crime and protect government property, it is essential to maintain our commitment to excellence, integrity and achievement.”
Annual Awards
The following awards were announced for accomplishments over the past year:
Gary Jordan Award
Recipient: Roann NicholsGary P. Jordan served with distinction for many years as an Assistant U.S. Attorney, as First Assistant from March 29, 1987 until his death on October 25, 1996, and as interim U.S. Attorney in 1993. This is an honorary award presented annually to an Assistant U.S. Attorney for exemplary performance that demonstrates the highest traditions of the office: integrity, ingenuity, dedication to public service and fairness.
Barnet D. Skolnik Award
Recipients: Martin J. Clarke
Sandra WilkinsonBarnet D. (Barney) Skolnik was an Assistant U.S. Attorney who led teams that prosecuted numerous white collar criminals and corrupt public officials in the 1970s, including Vice President Spiro T. Agnew. This is an honorary award presented annually to one or more Assistant U.S. Attorneys who demonstrate outstanding professionalism, determination and creativity in a case of unusual public significance.
Employee of the Year Award
Recipient: Elizabeth GardnerThe Employee of the Year Award recognizes sustained superior performance and outstanding achievements by a non-attorney employee. The award also recognizes the recipient's professionalism, dedication and comprehensive knowledge in their area of expertise.
Pete Twardowicz Award
Recipients: Michael Baier
Michael Corcoran
Karen Franks
Lynn Grant
Erika Jenson
David Lee
Sarah LewisThe Pete Twardowicz Award was established in honor of Eugene P. (Pete) Twardowicz, who rendered many years of outstanding service to the U.S. Attorney’s Office as an IRS criminal investigator and a Special Investigator for this Office. This award recognizes law enforcement agents or officers for outstanding cooperation and achievement while working with the U.S. Attorney’s Office on a significant case.
Excellence in Civil Advocacy
Recipient: Thomas H. BarnardThe U.S. Attorney’s Award for Excellence in Civil Advocacy, established in 2007, is presented annually to an Assistant U.S. Attorney for outstanding advocacy in civil litigation.
Excellence in Prosecution of Fraud
Recipients: Kevin V. DiGregory
Kristi N. O’MalleyThe U.S. Attorney’s Award for Excellence in Prosecution of Fraud, established in 2007, is presented annually to an Assistant U.S. Attorney for outstanding work in prosecuting fraud.
Excellence in Prosecution of Violent Crime
Recipient: Paul E. Budlow
Mark W. CrooksThe U.S. Attorney’s Award for Excellence in Prosecution of Violent Crime, established in 2007, is presented annually an Assistant U.S. Attorney for outstanding work in prosecuting violent crime.
Excellence in Prosecution of Organized Crime
Recipient: Ayn B. Ducao
Robert R. HardingThe U.S. Attorney’s Award for Excellence in Prosecution of Organized Crime, established in 2007, is presented annually to an Assistant U.S. Attorney for outstanding work in prosecuting organized criminal activity.
Excellence in Legal Support
Recipient: Gerry ZinserThe U.S. Attorney’s Award for Excellence in Legal Support, established in 2007, is presented annually to one or more non-attorney employees for outstanding work in support of the mission of the U.S. Attorney’s Office.
Outstanding Contributions to a Law Enforcement Initiative
Recipient: John Allen
Patrick Dugan
Bonnie S. Greenberg
Earl Jenkins
John SheridanThe U.S. Attorney’s Award for Outstanding Contributions to a Law Enforcement Initiative, established in 2007, is presented annually to one or more employees for outstanding work in support of an initiative of the U.S. Attorney’s Office.
Carl S. Lackl Award
Recipient: Michael Baier
Michael Groth
Patrick Michaels
The Carl S. Lackl Award for Exemplary Perseverance and Fortitude in Pursuit of Justice was established in 2008 in honor of Carl Stanley Lackl, Jr. Mr. Lackl witnessed a murder in Baltimore in 2006 and agreed to testify against the suspect he identified. After the suspect was arrested by police and charged in state court with the murder, he used a contraband cellular telephone to contact co-conspirators and arranged to murder Mr. Lackl, who was shot to death outside his house in front of his daughter. All of the conspirators were convicted on federal charges.New Employees
In addition, the U.S. Attorney welcomed new employees who joined the office last year. Assistant U.S. Attorney Zachary Myers and Special Assistant U.S. Attorneys: Frank Balsamello; Nathaniel Cohen; Anthony Enright; Piper McKeithen; James Pearce; and Jennifer Sykes. Non-Attorney Staff: Joanna Neubauer.
U.S. Attorney Bill Nettles Announces S.C. Drug Endangered Children (DEC) AllianceRead the Press Release
Contact Person: Anne Frate (803) 929-3000
Columbia, South Carolina ----- U.S. Attorney Bill Nettles, announced today that 22 federal, state and local leaders have entered into an alliance to identify and protect drug endangered children in the State of South Carolina.
The South Carolina Alliance for Drug Endangered children includes professionals – various law enforcement agencies, social services specialists, child advocates, prosecutors, physicians, fire fighters, and local community groups – who are striving for an effective way to identify and protect those children removed from drug environments, who are in danger of physical, mental and emotional abuse, as well as, exposure to the use of firearms, violence or other dangerous items associated with drug manufacturing and distribution.
“Drug Endangered Children are at greater risk of death, developmental problems, supervisory, educational and emotional neglect, as well as physical and sexual abuse. It is the goal of the DEC Alliance to coordinate the response to these children’s needs in order to break the cycle of drug and child abuse,” said Bill Nettles.
“Children discovered in drug environments have critical physical, behavioral and mental health needs that if not properly addressed will have long-term impact in their lives. These guidelines address timely and proper intervention,” said Dr. Olga Rosa, of the U.S.C School of Medicine.
Importantly, these guidelines do not require additional funding in order to be successful. This interdisciplinary model utilizes existing social infrastructure and creates the framework needed for each agency to not work within their own silo, but to instead work together toward a common goal; happy, healthy, protected children.
U.S. Attorney Bill Nettles said, “This is yet another progressive program instituted by our office assembling a broad based coalition to make the citizens of SC safer and healthier and break the circle of violence. We thank everyone who has participated in this process. I am proud of the results.”
The following agencies have endorsed the State Guidelines and were integral to their completion:
For Law Enforcement and Prosecution:
The U.S. Attorney’s Office – Bill Nettles, U.S. Attorney
S.C. Attorney General – Alan Wilson, Attorney General
S.C. Law Enforcement Division – Chief Mark Keel
S.C. Sheriff’s Association – Jeff Moore, Executive Director
S.C. Department of Public Safety – Leroy Smith, Director
S.C. Police Chief’s Association – Terrence Green, Chief
S.C. Commission on Prosecution Coordination – David Ross, Executive Director
S.C. Solicitor’s Association – Chrissy Adams, President
For Child Protection and Victim Services:
S.C. Department of Social Services – Lillian Koller, Director
S.C. Crime Victims’ Council – Laura Hudson, Director
S.C. State Office of Victim Assistance – Dr. Larry Barker, Director
S.C. Network of Children’s Advocacy Centers – Kim Hamm, Executive Director
U.S.C. School of Law, Children’s Law Center – Harry Davis, Director
Medical Response and Treatment
U.S.C. School of Medicine – Olga Rosa, M.D. FAAP, Director
S.C. Children’s Advocacy Medical Response System - Olga Rosa, M.D. FAAP, Director
S.C. Chapter of the American Academy of Pediatrics – Deborah Greenhouse, M.D., President
S.C. Department of Alcohol and Other Drug Abuse Services – Robert “Bob” Toomey, Director
The Medical University of South Carolina
Fire/HAZMAT, and Emergency Response
S.C. State Association of Fire Chiefs – Chief Tracy Wallace, President
S.C. Department of Health and Environmental Control – Catherine Templeton, Director
S.C. EMS Association – Derek Kinney, President
S.C. Firefighter’s Association – Joe Palmer, Executive DirectorTwo Plead Guilty in Prescription Drug Diversion SchemeRead the Press Release
Charles Jeffrey Edwards, 52, of Houston, Texas, and Brenda Elise Edwards, 43, of Houston, Texas, pleaded guilty yesterday, in U.S. District Court, to participating in a prescription drug diversion scheme, announced David Rivera, U.S. Attorney for the Middle District of Tennessee. Brenda Edwards pleaded guilty to one count of conspiracy, for which she faces up to five years in prison and a fine of $250,000. Charles Edwards pleaded guilty to one count of mail fraud and one count of money laundering. Mail fraud carries a maximum penalty of 20 years in prison and a $250,000 fine and money laundering carries a maximum penalty of 10 years in prison and a $250,000 fine. Both defendants will be sentenced on November 24, 2014.
At the plea hearing yesterday before U.S. District Court Judge Aleta A. Trauger, both defendants admitted that, from approximately December 2006 through August 2009, Charles Edwards co-owned Cumberland Distribution, Inc., a business engaged in the wholesale distribution of prescription drugs to pharmacies throughout the United States and which maintained its headquarters in Houston, Texas. Cumberland Distribution maintained warehouses in Nashville, Tenn., located at 5425 Harding Place and at 1419 Donelson Pike and was licensed by the State of Tennessee as a wholesale distributor of prescription drugs. Brenda Elise Edwards was an employee of Cumberland Distribution.
Both defendants admitted that Cumberland Distribution purchased a portion of the prescription drugs it resold to pharmacies from individuals and entities that were not licensed to engage in the wholesale distribution of prescription drugs and were not otherwise authorized to distribute prescription drugs. The prescription drugs were acquired through various networks of “diverters” who obtained prescription drugs from other unlawful sources. As a result, Cumberland Distribution could not lawfully resell the drugs. The defendants used the Nashville warehouses to receive deliveries of prescription drugs, where they were sorted and repackaged and shipped to pharmacies that had made purchases from Cumberland. Generally, the diverted drugs included drugs used to combat HIV/ AIDS medication, antipsychotic, anti-depression, as well as acid reflux, blood pressure medication, and diabetes medication.
Charles Edwards further admitted that as part of the scheme, he created a layer of distribution between the diverted pharmaceuticals and Cumberland Distribution by incorporating or causing others to incorporate various separate businesses, and caused the pharmaceuticals to be shipped to Cumberland Distribution through intermediaries, further concealing the true origin of the drugs.
For example, Charles Edwards admitted that in January 2008, he and Jerrod Nichols Smith directed another individual to open a business in Texarkana, Arkansas, called Tristate Management Group. The purpose of Tristate Management was to make it appear as though the pharmaceuticals that Cumberland Distribution was selling had been purchased from a licensed wholesale distributor, when in fact the pharmaceuticals were purchased from unlicensed or unauthorized sources. When shipments were received at Tristate Management, the individual would place new shipping labels on the packages and send them to the Cumberland Distribution warehouse in Nashville, or he would inventory the packages before sending the contents of the shipment on to Cumberland Distribution.
Pharmacies throughout the United States purchased diverted prescription drugs from Cumberland Distribution under the premise that the prescription drugs being purchased had been in the custody of licensed wholesale distributors or other authorized distributors since being sold by the original manufacturer. Cumberland Distribution used Federal Express to ship diverted prescription drugs and inaccurate pedigree documents to the pharmacies.
Brenda Edwards further admitted that as part of the conspiracy she caused wire transfers to be made from Cumberland Distribution’s bank account into bank accounts in various names that were under her and Charles Edwards’ control, for her own use or for the use of members of her family.
On May 14, 2009, the U.S. Food and Drug Administration executed a federal search warrant at Cumberland Distribution’s Nashville warehouse. Brenda Edwards admitted that on the day the search warrant was executed, in order to place the funds out of the reach of federal agents, she caused a wire transfer in the amount of $138,709.76 from a bank account she and Charles Edwards controlled, to a bank account in Mexico that was in the name of her mother.
According to the indictment, the scheme resulted in gross proceeds of over $58 million and the defendants gained over $14 million in profits.
The indictment also charged another individual, Jerrod Nichols Smith, with conspiracy, mail fraud, and making a false statement in a matter within the jurisdiction of the United States. A trial of Jerrod Nichols Smith is scheduled for October 7, 2014, before U.S. District Court Judge Aleta A. Trauger.
An indictment is merely an accusation of guilt. Jerrod Nichols Smith is presumed innocent unless and until proven guilty in a court of law.
This case was investigated by the United States Food and Drug Administration. Assistant United States Attorneys Kathryn Ward Booth and Sandra G. Moses represent the government.
Two Men Indicted on Drug ChargesRead the Press Release
BUFFALO, N.Y. – U.S. Attorney William J. Hochul, Jr. announced today that a federal grand jury has returned an indictment charging Ricardo Melendez, aka Ricardo Sanchez, aka Pupu, 18, of Buffalo, N.Y. and Abraham Tiro-Sanchez, aka Shorty, aka Mexico, 22, of Mexico, with conspiracy to possess with intent to distribute more than a 100 grams of heroin and possession with intent to distribute 100 grams or more of heroin. The charges carry a mandatory minimum penalty of five years in prison, a maximum of 40 years and a 5,000,000 fine.
Assistant U.S. Attorney Mary Catherine Baumgarten, who is handling the case, stated that on May 3, 2014, the defendants were pulled over by the New York State Police for a traffic stop. During a search of the vehicle, law enforcement officers recovered a quantity of heroin.
The defendants were arraigned this morning by U.S. Magistrate Judge H. Kenneth Schoreder. Both were ordered held and are due back in court on July 14, 2014.
The indictment is the culmination of an investigation by the Drug Enforcement Administration, under the direction of Special Agent in Charge James J. Hunt, New York Field Division and Immigration and Customs Enforcement, Homeland Security Investigations,
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.Two Marinette Men Sentenced on Heroin ChargesRead the Press Release
James L. Santelle, United States Attorney for the Eastern District of Wisconsin, announced that on May 8, 2014, Michael David Peak (age: 40) and Shawn Allen Klatt (age: 33) both of Marinette were sentenced to 24 months and 36 months respectively by Chief United States District Judge William C. Griesbach. Each had previously entered a guilty plea to a charge of using a communication facility (i.e., a telephone) to facilitate the distribution of heroin.
According to their plea agreements and other documents filed with the court, Peak and Klatt worked in concert with seven other co-defendants to facilitate the movement and delivery of heroin to the Marinette, Wisconsin, and Menominee, Michigan areas from a primary supplier in Chicago. Peak and Klatt were the first of nine defendants facing sentencing.
The court noted the “serious and dangerous nature” of the defendants’ actions, as well as the “devastating effect” that heroin use has had in the Marinette and Menominee region. The court described the coordinated actions of Peak, Klatt, and their co-defendants as essentially “a drug co-operative” designed not for the purpose of creating a profit, but to increase purchasing power and increase the frequency of coordinated “heroin runs” to Chicago.
The case was investigated by Special Agents from the Wisconsin Department of Justice, Department of Criminal Investigation, the United States Drug Enforcement Administration, the Marinette Police Department, Marinette Sheriff’s Office, Menominee (Michigan) Police Department, Menominee (Michigan) Sheriff’s Office, Wisconsin HIDTA Task Force, Chicago HIDTA Task Force, Chicago Police Department, Northeast Wisconsin Tri-County Drug Enforcement Group, and the Manitowoc County Sheriff’s Office. The case was prosecuted by Assistant United States Attorney Daniel R. Humble.
# # #Two City of Buffalo Officials Plead Guilty to Clean Air Act Violations Related to the Kensington Towers ProjectRead the Press Release
BUFFALO, N.Y. – U.S. Attorney William J. Hochul announced today that William Manuszewski, 59, and Donald Grzebielucha, 59, both of Buffalo, N.Y., pleaded guilty before U.S. District Court Judge Richard J. Arcara, to a negligent endangerment charge under the Clean Air Act. The charge carries a maximum penalty of one year in prison, a fine of $100,000 or both.
Assistant U. S. Attorneys Aaron J. Mango and Russell T. Ippolito, who are handling the case, stated that during the asbestos abatement project at the Kensington Towers Apartment Complex, located at 1827 Fillmore Avenue in Buffalo, both defendants were employed by the City of Buffalo as building inspectors. The asbestos abatement at Kensington Towers was conducted by Johnson Contracting of WNY, Inc., and the air monitoring was conducted by JMD Environmental, Inc.
On August 25, 2009, defendant Grzebielucha inspected building A-1 at Kensington Towers, and during the inspection, negligently allowed asbestos to be released in the air. Likewise, on January 15, 2010, defendant Manuszewski inspected building A-5 at Kensington Towers, and during the inspection, negligently allowed asbestos to be released in the air. During both inspections, the defendants admitted that they were negligent in relying on the previous inspections conducted by JMD employees that indicated all asbestos had been removed from the buildings.
Defendants Manuszewski and Grzebielucha are the seventh and eighth defendants to plead guilty as part of the Kensington Towers asbestos abatement project. Johnson Contracting supervisors Ernest Johnson and Rai Johnson, and JMD project monitors Evan Harnden, Chris Coseglia, Henry Hawkins and Brian Scott, have also been convicted. Charges are still pending against Theodore Lehmann, a public official at the time with the New York State Department of Labor, who was responsible for certifying the project’s compliance with applicable laws and regulations. The remaining defendant is due in court on May 13, 2014.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
The plea is the culmination of an investigation on the part of Special Agents of the U.S. Environmental Protection Agency - Criminal Investigation Division, under the direction of Acting Special Agent-In-Charge, Vernesa Jones-Allen; Special Agents of the Federal Bureau of Investigation; Special Agents of the U.S. Department of Housing and Urban Development - Office of Inspector General, under the direction of Special Agent-In-Charge Christina Scaringi; and Investigators of the New York State Department of Environmental Conservation Police, BECI, under the direction of Captain David Bennett. Additional assistance was provided by the New York State Department of Labor, Asbestos Control Bureau.Sentencing for defendants Grzebielucha and Manuszewski is scheduled for August 18, 2014, 2014 at 12:30 p.m. and 1:00 p.m., respectively, before Judge Arcara.
Three Charged in Connection with Armed Robbery in Town of Newburgh, New YorkRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Thomas J. Cannon, the Special Agent-in-Charge of the New York Field Office of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (“ATF”), and Chief Michael Clancy of the Town of Newburgh Police Department announced the unsealing of an Indictment against three defendants in connection with the December 28, 2013, armed robbery of a store on State Route 32 in the Town of Newburgh, New York.
U.S. Attorney Preet Bharara stated: “These charges are the product of outstanding cooperation among multiple law enforcement agencies. We will continue to work with our law enforcement partners, federal and local, to bring those who participate in violent, criminal conduct to justice.”
Special Agent-in-Charge of the New York Field Office of the ATF Thomas J. Cannon stated: “The defendants have been charged as result of the information-sharing and interagency cooperation that exists between the ATF and the Town of Newburgh Police Department, Ulster County Sherriff’s Office, the Town of New Windsor Police Department, the Town of Plattekill Police Department, and the New York State Police. This investigation should serve as a model to others that when law enforcement effectively collaborates, there is nothing that cannot be achieved.”
Town of Newburgh Chief Michael Clancy stated: “The Town of Newburgh Police Department would like to thank the various law enforcement agencies that assisted in this case including the Town of Plattekill Police Department, the Town of New Windsor Police Department, the Ulster County Sheriff’s Office, and the ATF, and the New York State Police. We would also like to thank U.S. Attorney Preet Bharara and the members of his staff for their efforts in bringing about this Indictment.”
The Indictment charges ANDREW HECHT, 20, MATTHEW MACKSON, 19, and GREGORY SCOTT, 25, with conspiracy to commit robbery, robbery, and the brandishing of a firearm in furtherance of the robbery conspiracy. The charge against each defendant and the corresponding maximum potential penalties are outlined in the chart attached to this press release. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencings of the defendants will be determined by the Court.
The Indictment was unsealed yesterday. One of the defendants was arrested yesterday and one was already in state custody. They were presented in White Plains federal court yesterday before U.S. Magistrate Judge Paul E. Davison, and were ordered detained. One defendant remains at large.
Mr. Bharara praised the outstanding investigative work of the ATF, the Town of Newburgh Police Department, the Town of New Windsor Police Department, the Town of Plattekill Police Department, the Ulster County Sheriff’s Office, and the New York State Police.
The prosecution is being handled by the Office’s White Plains Division. Assistant U.S. Attorney Michael Gerber is in charge of the prosecution.
The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Tampa Woman Pleads Guilty to Assault on DHS AgentRead the Press Release
Tampa, Florida – United States Attorney A. Lee Bentley, III announces that Latrese Brantley (40, Tampa) pleaded guilty yesterday to assaulting a federal agent. Brantley faces a maximum penalty of 20 years in federal prison.
According to the plea agreement, on April 30, 2013, Brantley was returning to Tampa on a Jet Blue flight from San Juan, Puerto Rico. Jet Blue flight personnel reported that Brantley had been of concern during the flight, and asked for a representative to come to the gate to escort Brantley off the plane. As Brantley was being escorted from the flight by a Jet Blue employee, she punched that employee. A Department of Homeland Security agent, who was in the airport terminal at the time, heard the commotion and came over to assist. She identified herself as a federal agent. Brantley punched the agent in the face and the two struggled near the flight gate. As a result of the struggle, the agent suffered scratches and abrasions and sustained physical injury that required later medical attention.
This case was investigated by the Transportation Security Administration. It is being prosecuted by Assistant United States Attorney Jay L. Hoffer.
Talent Agent Sentenced in Manhattan Federal Court for Stealing over Half A Million Dollars from His Actor Clients and Ordered to Forfeit Artwork He Purchased with ProceedsRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that PETER STRAIN, a talent agent for film, television, and Broadway actors, was sentenced today in Manhattan federal court to three years’ probation, six months’ home confinement, and 500 hours of community service for engaging in a scheme to steal over $500,000 of his clients’ money, which he used to purchase, among other things, expensive artwork and luxury personal items. STRAIN pled guilty in March 2014 before U.S. District Judge George B. Daniels, who also imposed today’s sentence.
According to the Superseding Information and other documents filed in Manhattan federal court, and statements made at related court proceedings, including today’s sentencing:
Through his talent agency, Peter Strain & Associates (“PSA”), STRAIN represented television, film, and stage actors. As a talent agent, STRAIN received funds in trust for his clients for their acting work, and was required to remit those funds to his clients, less his commission, which was typically 10%. However, between approximately 2011 and 2013, STRAIN diverted money he received on behalf of three clients, and used it to, among other things, pay for personal luxury retail goods and artwork. In order to conceal his theft and ensure that his clients allowed him to continue receiving money on their behalf, STRAIN repeatedly lied to his clients about why he had failed to timely remit their money.
Between July 2011 and December 2011, STRAIN received more than $1.4 million in an account held in trust for his clients (“the Trust Account”) on behalf of an actor who earned that money for work on a currently broadcast television series (“Client-1”). However, STRAIN failed to remit approximately $500,000 of this money to Client-1, and diverted it for his own personal use. In order to conceal his theft from Client-1, when STRAIN and Client-1 discussed the missing payments by telephone, STRAIN asked Client-1 if he could delay making the payments because, according to STRAIN, he was short on funds as a result of his partners at PSA embezzling money from the firm. STRAIN further claimed that he had recently won a lawsuit against his partners related to the supposed embezzlement, and that he was waiting to receive settlement payments from his partners.
STRAIN’s statements to Client-1 regarding the lawsuit were false. In truth, as STRAIN well knew, STRAIN’s partners had filed a lawsuit accusing STRAIN of embezzling funds from PSA, and STRAIN agreed to settle the lawsuit by paying his partners more than $250,000 for their shares in PSA. Moreover, in order to make a payment required under the settlement, instead of using his own money, STRAIN withdrew $30,000 from the Trust Account.
Ultimately, during 2012, STRAIN repaid Client-1 by stealing money from a different client, Client-2, an actor who has appeared in several television shows, including a currently broadcast television series. STRAIN then lied to Client-2 in order to conceal his theft. Among other things, STRAIN falsely told Client-2 that STRAIN had recently hired a new business management team and that the new team must have misplaced Client-2’s money. In truth and in fact, as STRAIN well knew, STRAIN had used Client-2’s money to repay the money he had stolen from Client-1. STRAIN never fully repaid the money he took from Client-2, and still owes Client-2 in excess of $350,000.
In July 2012, STRAIN failed to timely remit over $200,000 in additional payments to Client-1 for Client-1’s television acting work. In an email to Client-1 asking for additional time to remit the money, STRAIN repeated his false claim that he had “won” the lawsuit with his partners and was waiting for his partners to pay him. STRAIN further falsely claimed that he had Client-1’s money in his possession, but that he was restricted from accessing the money due to court orders. Contrary to his representations to Client-1, STRAIN had not “won” the lawsuit, was not restricted from accessing the funds owed to Client-1, and did not have sufficient funds in the Trust Account to pay Client-1. In fact, in the same month that STRAIN claimed he was unable to access Client-1’s money, STRAIN withdrew more than $80,000 from the Trust Account, leaving the account overdrawn by more than $9,000.
Between November 2012 and February 2013, STRAIN also stole tens of thousands of dollars from another client who has appeared in several television shows, including a currently broadcast television series (“Client-3”). To cover up his theft, STRAIN offered several false excuses to Client-3 for why he had failed to remit Client-3’s money. For example, in November 2012, STRAIN falsely claimed that Client-3’s payments had been lost in the mail. STRAIN also later falsely told Client-3 that the delays in remitting Client-3’s money were caused by a lawsuit, but that a confidentiality clause prevented STRAIN from discussing the details.
STRAIN used the money he stole from his clients to, among other things, pay operating expenses of PSA and to pay for personal luxury retail goods and artwork, some of which he purchased in New York using client money from California bank accounts. Between July 2011 and August 2012, using his clients’ money, STRAIN bought more than $161,000 in jewelry, more than $310,000 in artwork, and more than $57,000 at luxury goods retailers.
Mr. Bharara praised the outstanding investigative work of the FBI.
In addition to probation, STRAIN, 64, of Los Angeles, California, was ordered to forfeit all artwork obtained as part of the fraud, and to pay $384,128.52 in restitution.
The case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys James Pastore, Jr., and Jason Hernandez are in charge of the prosecution.
Stamford Man Admits Role in Mortgage Fraud SchemeRead the Press Release
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The United States Attorney for the District of Connecticut announced that TAIMUR AURORA, 40, of Stamford, waived his right to indictment and pleaded guilty today before Chief U.S. District Judge Janet C. Hall in Bridgeport to conspiring to defraud financial institutions through an extensive mortgage fraud scheme that involved dozens of properties in Fairfield County.
According to court documents and statements made in court, between 2005 and 2013, AURORA participated in a mortgage fraud conspiracy that involved the purchase of numerous single and multi-family properties, primarily in Bridgeport and Stamford. As part of the scheme, AURORA and his co-conspirators provided to mortgage lenders materially false information, including false verifications of mortgage applicants’ income, false verifications of down payments for real estate transactions and false HUD-1 Forms. AURORA also directed the actions of various “straw buyers,” or individuals who fraudulently applied for and obtained mortgage loans but did not have an actual financial investment or stake in the mortgage loan transactions. At times, AURORA acted as a straw buyer himself.
Many of the properties involved in this mortgage fraud scheme ended up in foreclosure, or in short sale transactions, and lenders suffered losses of more than $7 million. The loss attributed to AURORA’s role in this scheme totals approximately $4.2 million.
AURORA pleaded guilty to one count of conspiracy to commit wire fraud and bank fraud. He is scheduled to be sentenced on September 17, 2014, and faces a maximum term of imprisonment of 30 years.
This ongoing investigation is being conducted by the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorney Ann M. Nevins and Special Assistant U.S. Attorney John McReynolds.
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[email protected]Sonoma Man Pleads Guilty in $1.6 Million Fraud SchemeRead the Press Release
SAN FRANCISCO - Michael Thomas Hamilton, a/k/a Thomas Smith, pleaded guilty today in federal court in San Francisco to two counts of wire fraud, announced United States Attorney Melinda Haag and FBI Special Agent in Charge David J. Johnson.
In pleading guilty, Hamilton admitted that he engaged in a scheme to obtain money and property by means of materially false and fraudulent representations regarding Small Leaf, a book-selling business he owned and operated. Between February 2011 and continuing through October 2013, Hamilton solicited Small Leaf investors through Craigslist and other means. As part of the scheme, Hamilton falsely represented that: (1) investors would earn high rates of return through the sale of books on Amazon.com and other platforms; (2) if investors did not recoup their investment by a certain date, Small Leaf would reimburse the investor with interest of 10%; and (3) his book-selling business generated more than one million dollars in yearly revenue. In truth, Hamilton’s book-selling business generated a minimum amount of revenue. To induce investors to turn over their money and to lull them into falsely believing their investment was profitable, he made periodic payments to investors, which he claimed were royalties earned on the sale of books through Amazon. Most of the payments made to investors, however, were from investments by new investors or additional investments by existing investors.
According to the plea agreement, by October 2013, Hamilton had solicited approximately $1,616,000 from more than 20 investors in Calif., Ore., and Mass.
Hamilton, 49, of Sonoma, Calif., was indicted by a federal grand jury on Nov. 19, 2013. He was charged with 22 counts of mail fraud, wire fraud, and money laundering. He is currently released on a $75,000 bond.
Hamilton’s sentencing hearing is scheduled for Sept. 4, 2014, at 1:30 p.m., before the Honorable William H. Orrick, United States District Court Judge, in San Francisco. The maximum statutory penalty for each count of wire fraud, in violation of 18 U.S.C. § 1343, is 20 years’ imprisonment and a fine of $250,000 or twice the gross gain or loss from the offense, plus restitution. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Robert S. Leach is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Mary Mallory and Bridget Kilkenny. The prosecution is the result of an investigation by the FBI.
(Hamilton indictment )
Sentencing for May 5 - 8, 2014Read the Press Release
Bryan S. Everly, 20, of Gillette, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on May 8, 2014, for conspiracy to possess stolen firearms. Everly was arrested in Gillette, Wyoming. He received 54 months imprisonment, to be followed by three years of supervised release, and was ordered to pay a $200.00 fine and a $100.00 special assessment. This case was investigated by the Wyoming Division of Criminal Investigation.
Joseph Edward Fowles, 42, of Rozet, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on May 7, 2014, for possession of child pornography. Fowles was arrested in Rozet, Wyoming. He received time served, to be followed by ten years of supervised release, and was ordered to pay a $500.00 fine and a $100.00 special assessment. This case was investigated by the Wyoming Division of Criminal Investigation Internet Crimes Against Children Task Force.
Robert James Truby, 62, of Laramie, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on May 5, 2014, for being a felon in possession of a firearm and for possession of an unregistered firearm. Truby was arrested in Laramie, Wyoming. He received 57 months imprisonment, to be followed by three years of supervised release, and was ordered to pay a $400.00 fine and a $200.00 special assessment. This case was investigated by the Wyoming Highway Patrol and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Rochester Woman Sentenced for Workers Compensation FraudRead the Press Release
ROCHESTER, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that Amelia Jackson, 43, of Rochester, N.Y., who was convicted of workers compensation fraud, was sentenced to five years of probation, with the first six months on home detention, by U.S. District Court Judge Charles J. Siragusa. The defendant was also ordered to pay $14,524 in restitution.
Assistant U.S. Attorney Craig R. Gestring, who handled the case, stated that the defendant claimed to have sustained a work related injury in August of 2008 while employed by the United States Department of Veterans Affairs. As part of this claim, Jackson was limited in the amount of hours that she could work each day and was required to regularly report all outside income and employment. The defendant would regularly certify under oath that she was not engaged in any outside employment and that she was not receiving any other income. However, during this same time, Jackson opened and operated a liquor store in Rochester called “Last Call Liquors.”
Federal investigators observed the defendant going to her liquor store directly from her job at the VA during times she was falsely claiming to be home resting. During the times she was observed, Jackson did not seem to have any difficulty navigating the short staircase, reaching for, picking up, replacing bottles, or carrying the bag containing bottles to the door to give to customers. On at least one occasion, the defendant was recorded wearing her VA Identification while she was working in the liquor store.
As part of the investigation, Jackson appeared for an interview with a Workers Compensation Program representative to review her compensation file and current medical condition. Unknown to the defendant, the Workers Compensation Representative was actually an undercover federal agent. During this recorded interview, the defendant denied having any outside employment or income. At no time during this interview did Jackson disclose her ownership of a liquor store or any other employment outside of her federal job at the VA. During this interview, the defendant also falsely certified a Current Medical Assessment Evaluation denying outside employment or income. As a result of the defendant’s conduct, Jackson received $14,524.14 in Workers Compensation Benefits she would not otherwise be entitled to.
The sentencing is the culmination of an investigation on the part of Special Agents of the United States Department of Labor, New York Regional Office, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, under the direction of Cheryl Garcia, Acting Special Agent in Charge.
Richard Joseph SalonSpa Owners Agree to Plead Guilty to Tax Fraud ConspiracyRead the Press Release
BIRMINGHAM -- The owners and operators of Richard Joseph SalonSpas in the Birmingham area have agreed to plead guilty to a tax fraud conspiracy for failing to pay employment taxes to the IRS that they withheld from employees' wages over eight years, announced U.S. Attorney Joyce White Vance and Internal Revenue Service Criminal Investigation Special Agent in Charge Veronica Hyman-Pillot.
RICHARD JOSEPH SMITH, 54, and TIMOTHY EUELL BROWN, 55, both of Hoover, together have agreed to pay $1.4 million in restitution to the IRS as part of their plea agreements with the government. Smith and Brown acknowledge in their plea agreements that they withheld employment taxes from salon employees but did not report and pay those taxes over to the IRS. They also acknowledge that they skimmed money from the businesses for personal use.
The $1.4 million represents only the payroll taxes withheld from employees, not the employer portion of payroll taxes, which also went unpaid. Smith and Brown have agreed to cooperate with the IRS in determining their liability for the employer taxes and for unpaid personal taxes.
"These defendants have lived lavish lifestyles at the expense of the employees in their salons, who they cheated out of more than $1 million worth of Social Security and Medicare contributions by keeping the payroll taxes they deducted from employees' wages," Vance said. "Hardworking Americans receive the protection they deserve with prosecutions like this."
"Richard J. Smith and Tim E. Brown had a significant obligation to collect and remit all IRS withholding taxes," Hyman-Pillot said. "The failure to pay over withheld taxes defrauds the tax system and impacts employee benefits such as Social Security, Medicare and Unemployment Compensation," she said. "IRS Criminal Investigation recognizes that employment tax fraud is a heinous offense and will aggressively pursue individuals who engage in these schemes to defraud the government."
The U.S. Attorney's Office charged Smith and Brown in an information filed today in U.S. District Court, along with plea agreements for both men. They both agree to plead guilty to one count of conspiracy to defraud the United States, which carries a maximum penalty of five years in prison and a $250,000 fine.
Richard Joseph SalonSpa has been a prominent business for more than two decades with several locations in north Alabama. Smith was a master stylist at the salon's original location in Mountain Brook, and Brown was the business manager who handled finances, including payroll, according to the plea agreements.The plea agreements outline how Smith and Brown carried out their tax fraud conspiracy as follows:
Beginning in 1991, a company called Smith, Hobart & Brown operated Richard Joseph SalonSpa in Mountain Brook, and Brown was the sole owner and registered agent of SHB. SHB operated the spa from 1991 to July 2006. SHB owed more than $300,000 in employment taxes to the IRS by the third quarter of 2006. The IRS began notifying Brown of payroll tax deficits and requesting payment in 2004. When a revenue officer met with Brown and his accountant in 2007, Brown said he had closed his salon in July 2006 and no longer worked at Richard Joseph SalonSpa.
While the daily operation and management of Richard Joseph SalonSpa never changed, Smith incorporated a new company, RJSS Inc., in June 2006, listing himself as the registered agent. RJSS took over operation of Richard Joseph SalonSpa in Mountain Brook, and Smith and Brown opened a business checking account together for RJSS. Both men were listed as owners and had signature authority for RJSS.
In August 2008, Smith incorporated another business, Richard Joseph Redmont Group Inc., and he and Brown together opened a business checking account for it. In July 2009, Smith and Brown opened a Richard Joseph Salon on U.S. 280 in Inverness, and operated it through the Redmont Group.
"Between the third quarter of 2006 and the third quarter of 2013, Smith and Brown withheld from employees of RJSS Inc., and Redmont Group and failed to pay over a total of $1,408,504.68 in employment taxes to the IRS," the plea agreements states. Since RJSS's inception in 2006, Smith and Brown have not timely reported or paid to the IRS the taxes withheld from RJSS employees, and neither did they timely report or pay to the IRS the taxes withheld from Redmont Group employees since its inception in 2008, according to the plea agreements.
IRS Criminal Investigation Division investigated the case, which Assistant U.S. Attorney Robin Beardsley Mark is prosecuting.
Richard Joseph SalonSpa Owners Agree to Plead Guilty to Tax Fraud ConspiracyRead the Press Release
BIRMINGHAM -- The owners and operators of Richard Joseph SalonSpas in the Birmingham area have agreed to plead guilty to a tax fraud conspiracy for failing to pay employment taxes to the IRS that they withheld from employees' wages over eight years, announced U.S. Attorney Joyce White Vance and Internal Revenue Service Criminal Investigation Special Agent in Charge Veronica Hyman-Pillot.
RICHARD JOSEPH SMITH, 54, and TIMOTHY EUELL BROWN, 55, both of Hoover, together have agreed to pay $1.4 million in restitution to the IRS as part of their plea agreements with the government. Smith and Brown acknowledge in their plea agreements that they withheld employment taxes from salon employees but did not report and pay those taxes over to the IRS. They also acknowledge that they skimmed money from the businesses for personal use.
The $1.4 million represents only the payroll taxes withheld from employees, not the employer portion of payroll taxes, which also went unpaid. Smith and Brown have agreed to cooperate with the IRS in determining their liability for the employer taxes and for unpaid personal taxes.
"These defendants have lived lavish lifestyles at the expense of the employees in their salons, who they cheated out of more than $1 million worth of Social Security and Medicare contributions by keeping the payroll taxes they deducted from employees' wages," Vance said. "Hardworking Americans receive the protection they deserve with prosecutions like this."
"Richard J. Smith and Tim E. Brown had a significant obligation to collect and remit all IRS withholding taxes," Hyman-Pillot said. “The failure to pay over withheld taxes defrauds the tax system and impacts employee benefits such as Social Security, Medicare and Unemployment Compensation,” she said. "IRS Criminal Investigation recognizes that employment tax fraud is a heinous offense and will aggressively pursue individuals who engage in these schemes to defraud the government.”
The U.S. Attorney's Office charged Smith and Brown in an information filed today in U.S. District Court, along with plea agreements for both men. They both agree to plead guilty to one count of conspiracy to defraud the United States, which carries a maximum penalty of five years in prison and a $250,000 fine.
Richard Joseph SalonSpa has been a prominent business for more than two decades with several locations in north Alabama. Smith was a master stylist at the salon's original location in Mountain Brook, and Brown was the business manager who handled finances, including payroll, according to the plea agreements.The plea agreements outline how Smith and Brown carried out their tax fraud conspiracy as follows:
Beginning in 1991, a company called Smith, Hobart & Brown operated Richard Joseph SalonSpa in Mountain Brook, and Brown was the sole owner and registered agent of SHB. SHB operated the spa from 1991 to July 2006. SHB owed more than $300,000 in employment taxes to the IRS by the third quarter of 2006. The IRS began notifying Brown of payroll tax deficits and requesting payment in 2004. When a revenue officer met with Brown and his accountant in 2007, Brown said he had closed his salon in July 2006 and no longer worked at Richard Joseph SalonSpa.
While the daily operation and management of Richard Joseph SalonSpa never changed, Smith incorporated a new company, RJSS Inc., in June 2006, listing himself as the registered agent. RJSS took over operation of Richard Joseph SalonSpa in Mountain Brook, and Smith and Brown opened a business checking account together for RJSS. Both men were listed as owners and had signature authority for RJSS.
In August 2008, Smith incorporated another business, Richard Joseph Redmont Group Inc., and he and Brown together opened a business checking account for it. In July 2009, Smith and Brown opened a Richard Joseph Salon on U.S. 280 in Inverness, and operated it through the Redmont Group.
"Between the third quarter of 2006 and the third quarter of 2013, Smith and Brown withheld from employees of RJSS Inc., and Redmont Group and failed to pay over a total of $1,408,504.68 in employment taxes to the IRS," the plea agreements states. Since RJSS's inception in 2006, Smith and Brown have not timely reported or paid to the IRS the taxes withheld from RJSS employees, and neither did they timely report or pay to the IRS the taxes withheld from Redmont Group employees since its inception in 2008, according to the plea agreements.
IRS Criminal Investigation Division investigated the case, which Assistant U.S. Attorney Robin Beardsley Mark is prosecuting.
Real Estate Developer Pleads Guilty to <br /> $50 Million Securities Fraud SchemeRead the Press Release
A commercial real estate developer pleaded guilty for his role in a $50 million securities fraud scheme, announced Acting Assistant Attorney General David A. O’Neil of the Justice Department’s Criminal Division and U.S. Attorney Laura E. Duffy of the Southern District of California.
Bradley Holcom, 55, entered his plea before United States District Judge Cathy Ann Bencivengo in San Diego, admitting that he committed wire fraud in connection with the sale of approximately $50 million worth of promissory notes which he sold to investors located throughout the United States.
According to court documents, Holcom solicited investors to provide funds for commercial and residential development through an investment program he operated called the Trust Deed Investment Program. Holcom falsely told investors who purchased notes through the Trust Deed Investment Program that they would receive a lien on a specific piece of property he was developing and that the lien would enable them to take priority over any other potential liens or interests in the property.
However, Holcom admitted that he never provided investors with a lien in the property he was purportedly developing and instead conveyed to investors a lesser interest that did not allow them to foreclose on the property to protect their investment. In addition, while he promised investors that their purported lien would be in first position, he subsequently solicited investments for properties that he knew were already encumbered by first position liens. Holcom also sold properties that were supposedly serving as security for investors without informing investors that the property they had financed for development was sold. In 2008 and 2009, he continued to solicit investors for new funds by making misrepresentations about his true financial condition and the manner in which he was using investor money.
As part of his plea, Holcom admitted that his conduct caused approximately $50 million in losses to over 50 victims. Sentencing is scheduled for July 25, 2014.
This case was investigated by the FBI’s Phoenix Division – Yuma Resident Agency. The case is being prosecuted by Trial Attorney Henry P. Van Dyck and Deputy Chief Daniel Braun of the Criminal Division’s Fraud Section and by Assistant United States Attorney Mark Pletcher of the United States Attorney’s Office for the Southern District of California. The Department appreciates the substantial assistance of the U.S. Securities and Exchange Commission.Real Estate Developer Pleads Guilty to $50 Million Securities Fraud SchemeRead the Press Release
SAN DIEGO – A commercial real estate developer and mortgage broker pleaded guilty today for his role in a $50 million securities fraud scheme.
Bradley Holcom, 55, entered his plea before U.S. District Judge Cathy Ann Bencivengo, admitting that he committed wire fraud in connection with the sale of approximately $50 million worth of promissory notes which he sold to investors located throughout the United States.
According to court documents, Holcom solicited investors to provide funds for the development of raw land for commercial and residential purposes through an investment program he operated called the Trust Deed Investment Program. Holcom admitted that he falsely told investors who purchased notes through the Trust Deed Investment Program that they would receive a first-position lien on a specific piece of property he was developing.
However, as Holcom further admitted, he never provided investors with a lien in the property he was purportedly developing and instead conveyed to investors a lesser interest that did not allow investors to directly foreclose on the property to protect their investment. In addition, he admitted that while he promised investors that their purported lien would be in first position, he subsequently solicited investments for properties that he knew were already encumbered by first position liens.
According to court documents, Holcom also sold properties that were supposedly serving as the security for investors without informing investors that the property they had financed for development was gone. Holcom admitted that in 2008 and 2009, even though his financial condition had seriously deteriorated, he continued to solicit investors for new funds by making misrepresentations about his true financial condition and the manner in which he was using investor money.
As part of his plea, Holcom admitted that his conduct caused approximately $50 million in losses to over 50 victims. Holcom faces a maximum prison sentence of 20 years. Holcom is scheduled to be sentenced on July 25, 2014.
This case was investigated by the FBI’s Phoenix Division – Yuma Resident Agency. The case is being prosecuted by Trial Attorney Henry P. Van Dyck and Deputy Chief Daniel Braun of the Criminal Division’s Fraud Section, and by Assistant United States Attorney Mark Pletcher of the United States Attorney’s Office for the Southern District of California. The Department recognizes the substantial assistance of the U.S. Securities and Exchange Commission.
DEFENDANT Case Number: 13-CR-01723-CAB Bradley Holcom Age: 55 Escondido, CA CHARGESTitle 18, United States Code, Section 1343 -- Wire Fraud
INVESTIGATING AGENCY
Maximum penalties: 20 years’ imprisonment, $250,000 fine or twice the gross pecuniary gain or twice the gross pecuniary loss (whichever is greatest), $100 special assessment, 3 years of supervised release, restitution, and forfeiture.Federal Bureau of Investigation
*Indictments and complaints are not evidence that the defendant committed the crime charged. All defendants are presumed innocent until the United States meets its burden in court of proving guilt beyond a reasonable doubt.
Quincy Man Charged with Stealing Former Employer’s Intellectual PropertyRead the Press Release
BOSTON – A Quincy man was charged yesterday in connection with a scheme to steal valuable intellectual property from his former employer, Daedalus Software, Inc., of Cambridge.
Nabeel Memon, 29, of Quincy, was indicted today on wire fraud.
According to the indictment, in 2011, Memon worked for Daedalus as a software developer while living in Pakistan, and again in 2013 at Daedalus’s Cambridge office. Daedalus provides the health care industry with software that manages the storage and analysis of biological samples. In December 2013, Memon copied the source code for Daedalus’s product, called “BTM Research,” onto a personally-owned hard drive. When asked by Daedalus’s CEO if he was copying any company information, he lied and said that he was not.
The indictment alleges that the next day, Memon quit his job at Daedalus and went to work for a company, identified in the indictment only as Company A, that is not a competitor of Daedalus’s but also designs software for analysis of large volumes of data. Daedalus’s source code could allegedly be extremely valuable to a software designer at Company A. When an attorney for Daedalus sent Memon a letter demanding that he return all Daedalus information in his possession, he responded by falsely stating, in an e-mail, that he no longer had any Daedalus information. In fact, he continued to possess the entire BTM Research source code months after he quit his job at Daedalus.
If convicted, Memon faces a statutory maximum penalty of 20 years in prison and three years of supervised release.
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. The case is being prosecuted by Assistant United States Attorney Adam J. Bookbinder of Ortiz’s Cybercrime Unit. The U.S. Attorney’s office thanks Daedalus for cooperating with the investigation.
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.
Pittsburgh Woman Pleads Guilty in Fraud SchemeRead the Press Release
PITTSBURGH – A Pittsburgh woman pleaded guilty in federal court to a charge of Federal Employees’ Compensation Fraud, United States Attorney David J. Hickton announced today.
Cindy A. Elsesser, 45, pleaded guilty to one felony count before United States District Judge David S. Cercone.
According to information presented to the Court at the guilty plea, Elsesser, in connection with the application and receipt of federal employees’ compensation moneys and benefits, concealed and covered up the fact that she was employed. Elsesser’s fraudulent conduct resulted in compensation payments totaling approximately $4,771.41 being issued to her during the period from April 1, 2011, to March 11, 2013, payments Elsesser knew she was not entitled to receive.
Judge Cercone scheduled sentencing for Sept. 15, 2014 at 10 am. The law provides for a maximum total sentence of five years in prison, a fine of $250,000 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Pending sentence, the court released Elsesser on bond.
Assistant United States Attorney Mary McKeen Houghton is prosecuting this case on behalf of the government.
The Department of Labor, Office of Inspector General, and the United States Postal Service, Office of Inspector General, conducted the investigation leading to the plea of guilty in this case.
Philadelphia Man Sentenced to 38 Months in Federal Prison for Gun and Drug Crimes in BarreRead the Press Release
The Office of the United States Attorney for the District of Vermont, stated that on May 2, 2014, Gregory Johnson, 30, of Philadelphia, Pennsylvania, was sentenced to 38 months in prison for his participation in cocaine base distribution and the possession of firearm. Chief United States District Judge Christina Reiss, sitting in Burlington, also ordered Johnson to serve a term of three years of supervised release following his prison sentence.
According to court records, in late 2010 and early 2011, Johnson and his Barre associates, including Terry Bahner, Bahner’s wife, Bethany Pastuszak, and Bahner’s stepfather, Lestly Westcott, trafficked cocaine base from Philadelphia to Barre, Vermont where they resold it to local customers. Johnson admitted to possessing a handgun during the conspiracy.
A federal grand jury in the District of Vermont returned an indictment against Johnson on September 6, 2012. Johnson was arrested in Philadelphia on December 19, 2012 on an unrelated outstanding warrant from Pennsylvania. Once his Pennsylvania case was resolved, Johnson was transferred to the District of Vermont and appeared for arraignment in federal court in Burlington on August 7, 2013. On January 13, 2014, Johnson pled guilty to conspiring to distribute cocaine base.Pursuant to the advisory U.S. Sentencing Guidelines, Johnson faced between 46 and 57 months in prison. In determining the appropriate sentence, Judge Reiss considered, among other factors, the gravity of Johnson’s conduct and its negative impact on the community. Judge Reiss also considered Johnson’s lack of a significant criminal record.
Johnson is the sixth defendant to be sentenced in a series of related Barre cases. On January 5, 2012, Judge Reiss sentenced Bethany Pastuszak to four months of imprisonment and four months of home confinement, followed by a one-year term of supervised release, for making a false statement in connection with her purchase of a handgun.
On July 25, 2012, Judge Reiss sentenced James Beatrice, of Barre, to 33 months in federal prison, followed by a three-year term of supervised release, for illegally possessing a firearm as a convicted felon.
On August 8, 2012, Judge Reiss sentenced Ronald Newton, from Philadelphia, to 160 months in federal prison for his role in a cocaine distribution conspiracy and his possession of a handgun in furtherance of that conspiracy. Newton was also ordered to serve 10 years of supervised release following his prison term.
On September 19, 2012, Judge Reiss sentenced Lestly Westcott to serve 30 months in federal prison, followed by a three-year term of supervised release, for possessing a firearm as a convicted felon and distributing controlled substances.
On October 22, 2012, Judge Reiss sentenced Terry Bahner to serve 85 months in prison, followed by a three-year term of supervised release, for conspiring to distribute cocaine and illegally transferring a firearm.
United States Attorney Tristram J. Coffin commended the efforts of the Bureau of Alcohol Tobacco Firearms and Explosives, the Barre City Police Department, the Montpelier Police Department, the Vermont State Police, the U.S. Marshals, and the U.S. Border Patrol for their hard work and coordinated efforts on this investigation. The prosecutor is Assistant United States Attorney Timothy C. Doherty, Jr.
Johnson is represented by Assistant Federal Public Defender Steven Barth. Newton is represented by Natasha Sen. Bahner is represented by Elizabeth Mann. Westcott is represented by Karen Shingler and Pastuszak is represented by Robert Sussman. James Beatrice is represented by David Williams.
United States Attorney Coffin noted that this prosecution is part of the U.S. Department of Justice’s Project Safe Neighborhood, a nationwide commitment to reduce gun crime in America. Led by the U.S. Attorney’s Office and the Bureau of Alcohol Tobacco, Firearms and Explosives, Project Safe Neighborhood marshals federal, state and local resources to better locate, apprehend, and prosecute individuals who violate federal gun laws. For more information about Project Safe Neighborhood and Project Safe Vermont, please visit: www.psn.gov.Oregon Man Sentenced for Lacey Act ViolationRead the Press Release
Admits Aiding and Abetting Unlawful Acquisition and Transportation of Three Mountain Lions
COEUR D’ALENE – Christopher Wilson, 33, of Elgin, Oregon, was sentenced today in United States Magistrate Court to five years of probation for one count of aiding and abetting the unlawful acquisition and transportation of a mountain lion, a misdemeanor, U.S. Attorney Wendy J. Olson announced. United States Magistrate Judge Candy W. Dale ordered Wilson to pay a $500 fine and a $25 special assessment, and banned him from the use of firearms during his probation term. Additionally, Wilson is banned from hunting and fishing anywhere in the United States for a minimum of three years. The ban will extend to five years if the defendant does not earn his GED, attend hunter safety training, and serve 25 hours of community service.
According to the plea agreement, Wilson admitted that on January 19 and 20, 2012, he aided and abetted the unlawful hunting and transporting of three Pumas concolors, more commonly known as mountain lions. Wilson admitted that he allowed his Idaho tag to be put on a mountain lion taken by a hunter from North Dakota.
The case was investigated by the U.S. Fish and Wildlife Service and Idaho Fish and Game.
Oklahoma, Colorado, and Illinois Residents Among Nine Indicted for Conspiracy to Harvest Marijuana in Colorado for Distribution to Oklahoma, Illinois and Other StatesRead the Press Release
Oklahoma City, Oklahoma – Nine people have been indicted by a federal grand jury in Oklahoma City charging them with conspiracy to possess with intent to distribute marijuana, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. The nine defendants charged in this conspiracy are:
- Terry Hardin Wilkerson, 71, from Oklahoma City, Oklahoma,
- William Jesse Hoge, 53, from Oklahoma City, Oklahoma,
- Curtis Frank Wagner, 49, from Crestone, Colorado,
- David A. Geubelle, 45, from Highland Park, Illinois,
- Crystal Adams, 45, from Oklahoma City, Oklahoma,
- Marty Shellabarger, 67, from Moffatt, Colorado,
- Skylar J. Freeman, 25, from Crestone, Colorado,
- Shawn N. Maminakis, 34, from Crestone, Colorado, and
- David Lincoln Steele, 48, from Crestone, Colorado.
According to the indictment, from November of 2013 through April 24, 2014, the defendants were members of a drug trafficking organization that conspired to possess and provide more than 100 kilograms of marijuana from indoor and eventually outdoor marijuana grow facilities in Colorado to be transported and redistributed in Oklahoma, Illinois, and other states. It is further alleged that the defendants frequently communicated with cell phones and used coded language such as “farm” (the grow facilities in Colorado) and “Christmas Trees,” “Trees” or “Green” (marijuana) in an attempt to conceal the illegal nature of their conversations. The indictment alleges that the defendants used, distributed, and stored marijuana at various locations in the Oklahoma City and Crestone, Colorado, areas. The indictment seeks forfeiture of over $66,000 in cash, and properties located at 4500 North West 31st Place, 2101 North West 59th Street, and 3346 Willow Brook Road, all in Oklahoma City, and a property located at 9817 Stonebridge Drive, in Yukon, Oklahoma. For more information, reference is made the attached indictment.
If convicted, the defendants face no less than five and up to 40 years in federal prison and a fine of $5,000,000. The defendants are all presumed innocent unless and until proven guilty.
This case is the result of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation "Operation Stale Smoke" led by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Drug Enforcement Administration. Valuable assistance was also provided by the United States Attorneys’ Offices for the District of Colorado and the Northern District of Illinois. This case is being prosecuted in the Western District of Oklahoma by Assistant U.S. Attorneys David P. Petermann and David L. Walling.
Ocala, Florida Man Charged with Failure to Pay Child Support for His Children Who Reside in Orange County, New YorkRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and Tom O’Donnell, the Special Agent-in-Charge of the New York Field Office of the Inspector General, United States Department of Health and Human Services (“OIG-HHS”), announced the arrest yesterday of KURTISS L. TOMASOVICH for failure to pay child support. TOMASOVICH was arrested and presented in federal court in Ocala, Florida, before U.S. Magistrate Judge Philip R. Lammens.
U.S. Attorney Preet Bharara stated: “As alleged, Kurtiss Tomasovich failed to pay over $100,000 in child support, allegedly choosing to spend his money on his home and businesses, rather than fulfill his court-ordered obligation to pay support for his children. Such alleged conduct represents not only a failure to Tomasovich’s children, but a federal crime. I want to thank the excellent work of our partners at OIG-HHS in this case.”
Special Agent in Charge of the New York Field Office of OIG-HHS Tom O’Donnell stated: "Parents who try to avoid paying child support by moving to another state will instead face justice for their crime. Our investigators work hard to hold deadbeat parents accountable for skipping out on their financial responsibilities to care for their children.”
According to allegations in the Complaint previously filed in White Plains federal court:
Pursuant to a judgment of the New York State Supreme Court, Orange County, beginning in 2008, KURTISS L. TOMASOVICH was obligated to pay a minimum of $3,000 a month in child support with respect to his children, who reside in Tuxedo, New York. From at least in or about February 2008 until at least in or about April 2014, TOMASOVICH, who resides in Florida, failed to pay approximately $158,708 in child support. Notwithstanding TOMASOVICH’s repeated failure to make his child support payments, he has had sufficient assets available to him to pay. For example, TOMASOVICH and his second wife have purchased and developed property in Florida, including constructing a tennis court. In addition, during the relevant time period, TOMASOVICH and his second wife have had access to substantial funds and have owned and operated several businesses in Florida.
TOMASOVICH, 51, of Ocala, Florida, is charged with one count of failing to pay child support, which carries a maximum sentence of two years in prison. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Bharara praised the outstanding efforts of OIG-HHS and the Orange County Sheriff’s Department and thanked the Orange County Support Collections Unit for their assistance in the investigation.
This case is being handled by the Office’s White Plains Division. Assistant U.S. Attorney Kathryn Martin is in charge of the prosecution.
The allegations contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Newark Man Sentenced to 234 Months in Prison for Three Armed CarjackingsRead the Press Release
NEWARK, N.J. – A Newark man was sentenced today to 234 months in prison for his role in three armed carjackings that occurred in a one-week span in three counties across northern New Jersey, U.S. Attorney Paul J. Fishman announced.
Rahim Braxton, 34, previously pleaded guilty before U.S. District Judge Dennis M. Cavanaugh to a superseding information charging him with three counts of carjacking and one count of brandishing a firearm during the course of a violent crime. U.S. District Judge Esther Salas imposed the sentence today in Newark federal court.
According to documents filed in this case and in statements made in court:
Braxton admitted he participated with several other men in three carjackings that were committed in Essex, Hudson, and Passaic counties over a period of one week in March 2012. He said they agreed to take high-end BMW and Mercedes-Benz vehicles from their victims by force. Braxton also admitted that during each of the carjackings, at least one of the conspirators was armed with a gun that was to be used in order to threaten the drivers of the cars.
In addition to the prison term, Judge Salas sentenced Braxton to five years of supervised release.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford; the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Carolyn A. Murray; the Passaic County Prosecutor’s Office, under the direction of Prosecutor Camelia M. Valdes; the Hudson County Prosecutor’s Office, under the direction of Acting Prosecutor Gaetano T. Gregory; the Newark Police Department, under the direction of Police Director Sheilah A. Coley and Chief Ivonne Roman; the Clifton Police Department, under the direction of Chief John E. Link; and the Secaucus Police Department, under the direction of Chief Dennis Corcoran, for the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney James Donnelly of the Organized Crime/Gangs Unit in Newark.
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Defense counsel: Ruth M. Liebesman Esq., Paramus, N.J.Newark Man Charged with Producing Child Pornography for Recording His Sexual Abuse of GirlsRead the Press Release
NEWARK, N.J. – A Newark man made his initial court appearance today on charges that he sexually exploited two prepubescent girls after allegedly photographing himself abusing the girls, U.S. Attorney Paul J. Fishman announced.
Justin Kinney, 25, is charged by complaint with two counts of sexual exploitation of a child. He was already in state custody on related charges and had his initial appearance in Newark federal court today before U.S. Magistrate Judge Michael A. Hammer. Kinney was remanded without bail.
According to the complaint:
Law enforcement officers executed a search warrant on Kinney’s laptop computer and cellular telephone on Oct. 25, 2012. A forensic review of the equipment seized revealed several images of child sexual abuse that appear to be self-produced and allegedly depict Kinney sexually abusing two different prepubescent females.
Each charge of sexual exploitation of a child carries a mandatory minimum penalty of 15 years in prison, a maximum potential penalty of 30 years in prison and a $250,000 fine.
U.S. Attorney Fishman credited special agents of the Department of Homeland Security Investigations (HSI), Immigrations and Customs Enforcement, under the direction of Special Agent in Charge Andrew McLees; the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Carolyn A. Murray, and the N.J. Regional Computer Forensics Laboratory with the investigation leading to the charges.
The government is represented by Assistant U.S. Attorney Danielle M. Corcione of the U.S. Attorney’s Office General Crimes Unit in Newark.
HSI encourages the public to report suspected child predators and any suspicious activity through its toll-free hotline at 1-866-347-2423 or by completing its online tip form. Both are staffed around the clock by investigators. For additional information about wanted suspected child predators, download HSI’s Operation Predator smartphone app or visit the online suspect alerts page.
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Defense counsel: John Yauch Esq., Assistant Federal Public Defender, Newark
Kinney, Justin Complaint
New Hampshire Men Sentenced for Heroin Trafficking ConspiracyRead the Press Release
Contact: Daniel J. Perry
Assistant United States Attorney
Tel: (207) 780-3257
Portland, Maine: United States Attorney Thomas E. Delahanty II announced that Mitch
Merritt, 30, of Rochester, New Hampshire and Scott Woodman, 29, of Farmington, New
Hampshire were sentenced today in U.S. District Court by Judge George Z. Singal for their
involvement in a heroin distribution conspiracy. Merritt was sentenced to over 12½ years (151
months) in prison and five years of supervised release. Woodman was sentenced to over 5 years
(65 months) in prison and three years of supervised release. The defendants pleaded guilty to the
offense on May 7, 2013.
According to court records, from 2011 until February 2013, Merritt led a group of
individuals who obtained kilograms quantities of heroin in Lawrence, Massachusetts that was
distributed to customers in Maine and New Hampshire by Merritt, Woodman, and
others. Numerous home burglaries and shoplifting crimes were committed by customers to pay
for that heroin.This case was investigated by the United States Drug Enforcement Administration; the
Bureau of Alcohol, Tobacco, Firearms and Explosives; the Maine Drug Enforcement Agency;
the New Hampshire and Maine State Police; the York County Sheriff’s Office; and the
Rochester, New Hampshire Police Department; and results from the ongoing effort of the
Organized Crime Drug Enforcement Task Forces (OCDETF), a partnership between federal,
state and local law enforcement agencies. 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.Navajo Man from Thoreau Sentenced to Seventy Months in Federal Prison for Assault ConvictionRead the Press Release
ALBUQUERQUE – Aldo Jones, 31, an enrolled member of the Navajo Nation who resides in Thoreau, N.M., was sentenced this afternoon to 70 months in federal prison followed by three years of supervised release for his conviction on two assault charges. Jones also was ordered to pay $47,574.91 to the Indian Health Services to cover the costs of medical care for the victims and $80.00 to one of the two victims.
Aldo Jones and his brother Eddie Jones, Jr., III, 23, also of Thoreau, were arrested in early Aug. 2013, based on a criminal complaint charging them with assault charges arising out of an attack on a 21-year-old Navajo man in Crownpoint, N.M., on July 28, 2013. According to court filings, Aldo Jones and Eddie Jones assaulted the victim for failing to pay a $50 debt. Aldo Jones repeatedly stabbed the victim in the head, upper back and right hand with a screwdriver, and both he and Eddie Jones pummeled the victim with their fists. The victim sustained a life-threatening injury to his head where his skull was punctured. He also sustained stab wounds to his upper back and right hand and a broken nose.
Aldo Jones and Eddie Jones subsequently were charged in a four-count indictment with assault resulting in serious bodily injury and assault with a dangerous weapon arising from the assault on the 21-year-old victim. Aldo Jones also was charged with two assault charges arising out of an attack on a second victim on July 28, 2013, in Littlewater, N.M.
On Dec. 4, 2013, Aldo Jones pled guilty to two assault charges and admitted assaulting the two victims on July 28, 2013. He admitted assaulting the first victim at approximately 5:00 p.m. by stabbing him with a screwdriver. Aldo Jones also admitted stabbing the second victim with a knife approximately two hours later when the second victim confronted him about stabbing his cousin, the first victim.
On Dec. 5, 2013, Eddie Jones entered a guilty plea to assaulting the first victim. In his plea agreement, Eddie Jones admitted beating the victim who also was stabbed by Aldo Jones. At sentencing, Eddie Jones faces a maximum penalty of ten years in prison for each assault charge. He remains in custody pending his sentencing hearing, which has yet to be scheduled.
The case was investigated by the Crownpoint office of the Navajo Nation Division of Public Safety and is being prosecuted by Assistant U.S. Attorney Paul H. Spiers.
Naples Man Sentenced for Lacey Act ViolationRead the Press Release
Admits Aiding and Abetting Unlawful Acquisition and Transportation of Three Mountain Lions
COEUR D’ALENE – Jacob R. Navarro, 22, of Bonner County, Idaho, was sentenced today in United States Magistrate Court to five years of probation for one count of aiding and abetting the unlawful acquisition and transportation of a mountain lion, a misdemeanor, U.S. Attorney Wendy J. Olson announced. United States Magistrate Jude Candy W. Dale also ordered Navarro to pay a $750 fine and a $25 special assessment, and banned him from the use of firearms during his probation term. Additionally, Navarro is banned from hunting and fishing anywhere in the United States for a minimum of three years. The ban will extend to five years if the defendant does not earn his GED, attend hunter safety training, and serve 50 hours of community service.
According to the plea agreement, Navarro admitted that on January 19 and 20, 2012, he aided and abetted the unlawful hunting and transporting of three Pumas concolors, more commonly known as mountain lions. Navarro admitted that he allowed his Idaho tag to be put on a mountain lion taken by a hunter from North Dakota.
The case was investigated by the U.S. Fish and Wildlife Service and Idaho Fish and Game.
Named Defendant in Dorsey V. United States arrested and Charged with New Federal OffensesRead the Press Release
Springfield, Ill. B Today, a federal grand jury returned an indictment charging Edward Dorsey Sr., 42, of St. Anne, Illinois, with three counts of distributing cocaine base (“crack”) in violation of federal law. Additionally, the United States Probation Office for the Central District of Illinois previously filed a petition to revoke Dorsey’s federal supervised release (similar to parole) based on his recent drug trafficking activities, as well as based on allegations of Aggravated Unlawful Restraint and Battery involving a firearm in violation of state law.
According to today’s indictment, Dorsey allegedly distributed more than 28 grams (approximately one ounce) of crack cocaine in Kankakee County, in the Central District of Illinois, on both November 21 and December 18 of 2013. The indictment also alleges that Dorsey distributed crack cocaine on December 10, 2013, in Kankakee County, Illinois.
If convicted of the new drug trafficking charges, Dorsey faces a mandatory minimum sentence of 10 years of imprisonment up to life imprisonment under the revised penalties contained in the Fair Sentencing Act.
Dorsey was on supervised release from a prior conviction for a federal crack cocaine trafficking offense. Dorsey appealed his sentence to the United States Supreme Court, which concluded that Dorsey should have been sentenced under the Fair Sentencing Act. This served to reduce Dorsey’s sentence and the sentence of others who were sentenced for similar crimes after the effective date of the Act, August 3, 2010.
Dorsey faces additional penalties because he was still serving his term of supervised release when he is alleged to have committed the crimes in the indictment. According to a petition to revoke his supervised release, Dorsey also allegedly kidnapped and battered a man at a Citgo Gas Station in Pembroke, Illinois, on January 9, 2014. The petition further alleges that Dorsey grabbed the man by the shirt, forced him into a car, pointed a gun at the man, and punched and choked him. The petition alleges that Dorsey drove around with the man until Dorsey found a stolen television, at which point, he let the man go.
If Dorsey’s supervised release is revoked, he could be sentenced to up to three years of imprisonment in addition to any sentence for the drug trafficking charges.
Dorsey will appear before United States Magistrate Judge David G. Bernthal in Urbana at a future date to be arraigned on the drug trafficking charges and to address the petition to revoke his supervised release.
Members of the public are reminded that both an indictment and petition to revoke supervised release are merely accusations; the defendant is presumed innocent unless proven guilty.
The charges are the result of an investigation by the Kankakee Area Project Safe Neighborhoods Task Force, the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Kankakee Police Department, and the Kankakee County Major Crimes Task Force. The case is being prosecuted by Assistant U.S. Attorney Eugene L. Miller.
Middlesex County, N.J., Dermatologist Charged with Structuring Nearly $850,000 in Deposits to Avoid Reporting RequirementsRead the Press Release
NEWARK, N.J. - A dermatologist with a medical practice in East Brunswick, N.J., was charged today for allegedly structuring nearly $850,000 by intentionally purchasing numerous money orders for amounts below what would trigger a financial institution’s IRS reporting requirements, U.S. Attorney Paul J. Fishman announced.
Sandy S. Milgraum, 60, is charged in a criminal complaint with one count of conspiring to structure financial transactions to evade currency reporting requirements. Milgraum made his initial appearance in Newark federal court this afternoon and was released on $300,000 bail.
According to the complaint filed in this case and statements made in court:
Milgraum is a licensed and board-certified dermatologist who operates the Academic Dermatology Laser Surgery Center in East Brunswick. From January 2005 through August 2010, Milgraum and others acting at his direction purchased approximately 1,280 money orders and monetary instruments totaling at least $846,092.92.
Each money order was purchased below the $3,000 limit that would require a financial institution to file a Cash Transaction Report with the IRS and disclose the identity of the individual who conducted the transaction, as well as the individual or organization for whom the transaction was completed.
Milgraum and others purchased money orders from various venders including MoneyGram, Western Union, Bank of America and the United States Postal Service and then used them to make mortgage payments, credit card payments, business payments and other personal payments, including payments for various credit card debts incurred by a romantic partner of Milgraum’s.
The charge carries a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gain or loss caused by the offense.
U.S. Attorney Fishman credited special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Jonathan D. Larsen, and inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge Maria Kelokates, with the investigation leading to the charge.The charge and allegations contained in the complaint are merely accusations and the defendant is presumed innocent unless and until proven guilty.
The government is represented by Assistant U.S. Attorney Michael H. Robertson of the U.S. Attorney’s Office’s Health Care and Government Fraud Unit in Newark.
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Defense counsel: Joseph J. Benedict Esq., New Brunswick, N.J.
Milgraum, Sandy Complaint
Michigan Man Indicted for Three Bank RobberiesRead the Press Release
An indictment was filed chagring Jason Radigan, age 39, of Northville, Michigan, with robbing three banks, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment charges Radigan with robbery of Charter One Bank, located at 5150 North Summit Street, Toledo, Ohio, on January 30, 2014; Huntington Bank, located at 5201 North Summit Street, Toledo, Ohio, on March 4, 2014; and State Bank & Trust, located at 610 East South Boundary, Perrysburg, Ohio on April 9, 2014.
If convicted, the defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The investigating agency in this case is the Federal Bureau of Investigation’s Northwest Ohio Violent Crimes Task Force, the Toledo Police Department, and the City of Perrysburg, Ohio Police Department. The case is being handled by Assistant United States Attorney Ava Dustin.
An indictment is only a charge and is not evidence of guilt. Defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Mexican Man Charged with Illegal ReentryRead the Press Release
An indictment was filed charging Salvador Soto-Gomez, age 63, of Mexico, with with unlawful reentry into the United States on April 2, 2014, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
If convicted, the defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The investigating agency in this case is the United States Department of Homeland Security, Cleveland, Ohio. The case is being handled by Assistant United States Attorney Michael J. Freeman.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Mexican Citizen Pleads Guilty to Unlawful Use of Identification Documents and Aggravated Identity TheftRead the Press Release
A Mexican citizen who was twice convicted using the identity of a dead American citizen who attempted to obtain new identification documents and gain employment in that name plead guilty May 7, 2014, in federal court in Cedar Rapids.
Abel Fajardo-Guizar, age 38, a citizen of Mexico, living in Cedar Rapids, Iowa, was convicted of two counts of unlawful use of identification documents and two counts of aggravated identity theft.
In a plea agreement, Fajardo-Guizar admitted he was twice convicted under the name of another real person who died in 1995. On November 22, 2013, falsely claiming to be a U.S. citizen, Fajardo-Guizar used the date of birth, the Social Security Card and Social Security Number of another real person, someone he personally knew, to obtain a State of Iowa Identification Card in that person’s name. On December 18, 2013, again falsely claiming to be a U.S. citizen, Fajardo-Guizar used the date of birth, the Social Security Card and Social Security Number of another real person, and the recently acquired State of Iowa Identification Card when completing forms required to work in this country. On March 1, 2014, Fajardo-Guizar attempted to obtain a State of Iowa driver’s license using that the name, date of birth and Social Security Number of that other real person. When arrested on Federal charges on March 19, 2014, defendant had in his possession that other person’s birth certificate.
Sentencing before United States District Court Chief Judge Linda R. Reade will be set after a presentence report is prepared. Fajardo-Guizar remains in custody of the United States Marshal pending sentencing. On each unlawful use of identification documents conviction, Fajardo-Guizar faces a possible maximum sentence of ten years’ imprisonment, a $250,000 fine, $100 in special assessments, and three years of supervised release following any imprisonment. On each aggravated identity theft conviction, Fajardo-Guizar faces a mandatory sentence of two years’ imprisonment, a $250,000 fine, $100 in special assessments, and one year of supervised release following any imprisonment. Any sentence on the aggravated identity theft convictions must be served consecutive to any other sentence.
The case is being prosecuted by Assistant United States Attorney Daniel C. Tvedt and was investigated by agents from the Department of Homeland Security, Immigration and Customs Enforcement.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 14-CR-38.
Massage Parlor Owner Pleads GuiltyTo Harboring, Obstruction of JusticeRead the Press Release
WICHITA, KAN. - The former owner of a Wichita massage parlor pleaded guilty Thursday to harboring an undocumented Chinese woman and threatening to harm a law enforcement officer, U.S. Attorney Barry Grissom said.
Gary H. Kidgell, 45, Waltham, Mass., pleaded guilty to one count of harboring an alien who was illegally in the United States and one count of attempted obstruction of justice. In his plea, Kidgell admitted that in January 2011 he interviewed a Chinese woman to work at a massage parlor he owned in Wichita. Kidgell spoke to the woman through an interpreter because she did not speak English. He made the Chinese woman stay at his residence and pay rent.
In January and February 2014 while Kidgell was in custody in the case he told other inmates at the Butler County Jail that he intended to harm a law enforcement officer who investigated the case unless his case was resolved the way he wanted.
Kidgell is set for sentencing Aug. 1. Both parties have agreed to recommend a sentence within in the range of 51 months and 63 months in federal prison.
Co-defendants include:
Yan Zhang, 50, Wichita, Kan., who is awaiting trial.
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 Business Owner Sentenced in Manhattan Federal Court to 46 Months in Prison for His Participation in A $2.9 Million Ponzi SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that JASON KONIOR, the founder and manager of a number of related business entities in New York City, collectively referred to as “Absolute,” was sentenced yesterday in Manhattan federal court to 46 months in prison for his participation in a Ponzi scheme. KONIOR previously pled guilty on July 9, 2013, to one count of wire fraud for his role in stealing at least $2.9 million from small hedge fund investors and using the funds to pay off prior investors and to pay himself. He was sentenced yesterday by U.S. District Judge Alvin K. Hellerstein.
According to the Information, statements made during KONIOR’s sentencing proceeding yesterday and his guilty plea on July 9, 2013, and a Complaint previously unsealed in Manhattan federal court:
From late 2011 through May 2012, KONIOR organized and managed a Ponzi scheme in which he misappropriated at least $2.9 million in funds he had solicited from hedge fund investors. He represented to these hedge funds that Absolute would provide additional trading funds of up to nine times the investment they made in Absolute. As part of Absolute’s “first loss” investment program, KONIOR claimed that he would place the combined funds – the investors’ funds and the additional funds to be provided by Absolute – in a brokerage account designated by Absolute. According to KONIOR, the hedge fund investors would then be able to trade securities utilizing that brokerage account. Under the arrangement, the hedge funds would be responsible for trading losses, and they would share any profits with Absolute.
Instead of establishing brokerage accounts for the victim hedge funds, KONIOR misappropriated the funds they provided by paying redemptions to prior investors, making payments to himself, and paying various personal and business expenses. In e-mails, text messages, and telephone conversations, KONIOR pretended that he was establishing brokerage accounts for the three hedge fund investors, when he had already stolen their money. In one case, after he repeatedly failed to set up a brokerage account for one of the hedge funds, the manager of the fund sent him a text message stating, “I want my money back. What did you do to it anyway? Are you going to tell me or do you want the SEC to find out?” KONIOR responded with a text message that said, “[w]e have your funds in our acct. Where else would they be?” At the time he wrote the message, he had already used that hedge fund’s investment to pay off other investors and his own expenses.
In addition to the prison term, Judge Hellerstein sentenced KONIOR, 40, of New York, New York, to three years of supervised release. KONIOR was also ordered to forfeit $2.9 million and to pay a $2.9 million fine.
Mr. Bharara praised the work of the Federal Bureau of Investigation and the Securities and Exchange Commission.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Since the inception of FFETF in November 2009, the Justice Department has filed more than 12,841 financial fraud cases against nearly 18,737 defendants including nearly 3,500 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
This case is being handled by the Office's Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys John T. Zach and Jason H. Cowley are in charge of the prosecution.
Man Pleads Guilty to Armed CarjackingRead the Press Release
MINNEAPOLIS—Yesterday in federal court, a 22-year-old Minneapolis man, Larry Jarrell Campbell pleaded guilty to one count of Carjacking and one count of Brandishing a Firearm During and in Relation to a Crime of Violence. Campbell, who was indicted on March 10, 2014, entered his plea before United States District Court Judge Joan N. Ericksen.
In his plea agreement, Campbell admitted that on January 12, 2014, he approached a vehicle occupied by two victims and parked in the parking lot of a convenience store in North Minneapolis. He tapped on the rear window of the vehicle using a .22 caliber pistol and got into the back seat of the vehicle. He then pointed the gun at the two victims and threated to kill them. He demanded that the victims drive him to two separate ATMs to have the victims withdraw money from their bank accounts for him. He then commanded the victims to exit the vehicle and to lie face-down in a snowbank at gunpoint, so he could steal their vehicle. He then took the vehicle, drove to a nearby Walmart store, and attempted to use one of the victim’s credit cards to purchase merchandise.
Carjacking carries a potential maximum penalty of 15 years imprisonment. Brandishing a Firearm During and in Relation to a Crime of Violence carries a statutory minimum penalty of seven years, and a potential maximum penalty of life imprisonment. Judge Ericksen will determine the defendant’s sentence at a future hearing, not yet scheduled.
This case is the result of an investigation by the United States Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Minneapolis Department. It is being prosecuted by Assistant U.S. Attorney Surya Saxena.Lowell Man Charged Federally for Producing Child PornographyRead the Press Release
GRAND RAPIDS, MICHIGAN – A federal grand jury returned a nine-count indictment Thursday charging a West Michigan man with producing and possessing child pornography. The indictment alleges that Travis Stiehl, 22, produced sexually explicit photographs and videos of children as young as two years old on eight different occasions from September 2011 to August 2013. The indictment also charges Stiehl with possession of approximately 2,000 images of child pornography on a hard drive.
Stiehl was arrested April 25, 2014, at his mother’s residence in Lowell, which had previously operated as a daycare facility. He has been in custody since that time. The eight production counts each carry a mandatory minimum sentence of 15 years in prison and a maximum of 30 years. The possession count carries a maximum sentence of 20 years.The charges are the result of an investigation conducted by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and the Michigan State Police Internet Crimes Against Children. Assistant U.S. Attorney Tessa K. Hessmiller is the prosecutor on the case.
HSI requests that anyone who believes his or her child may have been a victim contact HSI at 616-235-3936, extension 2215.
The charges in an indictment are merely accusations, and a defendant is presumed innocent until and unless proven guilty in a court of law.
END
Keith Miller of Lyndonville, Vermont Sentenced to 21 Months for Possession of Child PornographyRead the Press Release
The Office of the United States Attorney for the District of Vermont stated that Keith Miller, 44, of Lyndonville, Vermont was sentenced on May 5, 2014 for possession of child pornography. Judge William K. Sessions III sentenced Miller to 21 months in prison, to be followed by five years of supervised release. Miller’s supervised release conditions will include special sex offender conditions, including a requirement that he register as a sex offender upon his release from prison. Judge Sessions ordered Miller to surrender to serve his sentence on June 10, 2014.
According to court documents, as part of an on-line investigation into users’ acquisition of child pornography by computer, federal agents determined that a computer at Miller’s residence had downloaded child pornography. Agents executed a federal search warrant at Miller’s residence on February 19, 2013. Miller admitted that he had used his computer to download child pornography. Subsequent forensic analysis of the computers seized from Miller determined that Miller had downloaded a substantial number of images of child pornography.
This matter was investigated by Homeland Security Investigations and the Vermont State Police, with the assistance of the Lyndonville Police Department. The case was prosecuted by Assistant U.S. Attorney Kevin J. Doyle. Miller is represented by David L. McColgin of the Federal Defender’s Office.
Jury Convicts Two Inmates of Murdering Prisoner, Trial Enters Death Penalty PhaseRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that two inmates of the U.S. Medical Center for Federal Prisoners in Springfield, Mo., have been convicted in federal court of murdering another inmate at the facility.
Wesley Paul Coonce, Jr., 34, and Charles Michael Hall, 43, who are both inmates at the U.S. Medical Center for Federal Prisoners, were found guilty on Wednesday, May 7, 2014, of one count of murder in the first degree. Coonce was also found guilty of one count of murder by an inmate serving a life sentence.
The evidence presented at trial demonstrated that another inmate at the prison medical center, Victor Castro-Rodriguez, 51, was found deceased on the floor of his cell on Jan. 26, 2010.
Following the presentation of evidence, the jury in the U.S. District Court in Springfield, Mo., deliberated for about an hour before returning the guilty verdicts to U.S. District Judge Gary A. Fenner, ending a trial that began April 28, 2014.
The trial now enters the penalty phase in which the jury must determine the sentences for Coonce and Hall. Under federal statutes, Coonce and Hall are subject to either the death penalty or life in federal prison without parole.
This case is being prosecuted by Trial Attorney James D. Peterson of the Capital Case Section of the U.S. Department of Justice’s Criminal Division and Assistant U.S. Attorney Randall D. Eggert. It was investigated by the FBI and the Bureau of Prisons.Information: Federal Court ArraignmentsRead the Press Release
The United States Attorney's Office today announced that those persons listed below were arraigned before the U.S. Magistrate and the indictments handed down by the Grand Jury unsealed.
Appearing before U.S. Magistrate Judge Ostby in Billings on May 7, 2014 and entering pleas of Not Guilty were:
- JORDAN CAMPBELL-ZORN, a 22-year-old resident of Glendive, appeared on charges of receipt of child pornography. If convicted of the charge contained in the indictment, CAMPBELL-ZORN faces 5 years imprisonment, $250,000 in fines and lifetime supervised release. The case was investigated by the Federal Bureau of Investigation. PACER Case Reference: 14-41
Appearing before U.S. District Judge Brian Morris in Great Falls on May 8, 2014 and entering pleas of Not Guilty were:
- ADAM BLUE COLGAN, a 33-year-old resident of Poplar, appeared on charges of possession of an unregistered destructive device and transportation of explosive material by a non-licensee. If convicted of the charges contained in the indictment, COLGAN faces 10 years imprisonment, $250,000 in fines and 3 years supervised release. The case was investigated by the Federal Bureau of Investigation. PACER Case Reference: 13-114
If any of the above cases are of interest to your media organization and the community it serves, we encourage you to monitor the progress of the case regularly through the U.S. District Court calendar and the PACER system so that you stay current and not miss any important developments in the case.
To establish a PACER account, which will allow you to review documents filed in the case, please go to, http://www.pacer.gov/register.html. To access the district court's calendar, please go to https://ecf.mtd.uscourts.gov/cgi-bin/PublicCalendar.pl.
Indictment Charges Three People in Nine Day, Four County Armed Robbery SpreeRead the Press Release
PHILADELPHIA – An indictment filed today charges Dale Mentzer, 36, of Waymart, PA, and Heath DeRizzo, 37, of Manheim, PA, in a half-dozen armed robberies, in Berks, Chester, Lebanon, and Northampton Counties, between July 11, 2013 and July 19, 2013, announced United States Attorney Zane David Memeger. The pair was charged with two counts of interference with interstate commerce by robbery, four counts of bank robbery, two counts of use and carrying of a firearm during a crime of violence, and two counts of convicted felon in possession of a firearm. A third defendant, Samantha Henderson, 23, of Fredericksburg, PA, was charged with accessory to robbery after the fact.
According to the indictment, Mentzer and DeRizzo committed armed robberies at a Sovereign Bank branch in Kutztown, on July 11, 2013; a Northwest Savings Bank branch in Myerstown, on July 16, 2013; a First Cornerstone Bank branch in Phoenixville and The Rodeway Inn motel in Muhlenberg, on July 18, 2013; a National Penn Bank branch, on July 19, 2013; and, that same day, Cihylik Farms in Allen Township. Henderson is charged with assisting Mentzer and DeRizzo hinder and prevent their apprehension, trial, and punishment.
If convicted, defendants Mentzer and DeRizzo each face a minimum mandatory term of 32 years in prison up to life, a fine of up to $2.5 million, five years of supervised release and a $1,000 special assessment. Henderson faces a maximum possible sentence of 10 years in prison, three years of supervised release, a fine of up to $250,000, and a $100 special assessment.
The case was investigated by the Federal Bureau of Investigation-Allentown Resident Agency, Pennsylvania State Police, East Pikeland Township Police Department, Northampton Police Department, Kutztown Police Department, Muhlenberg Township Police Department, Worcester County Bureau of Investigation, and FBI Baltimore-Salisbury Resident Agency. It is being prosecuted by Assistant United States Attorney John Gallagher.
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
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PATTY HARTMAN, Media Contact, 215-861-8525Importers of Fake Brand Name Goods That Were Illegally Counterfeited in China Are Sentenced to Federal PrisonRead the Press Release
LOS ANGELES – A San Gabriel Valley businessman who coordinated the importation of 11 containers of counterfeit apparel – including Nike, Gucci and Coach products worth more than $2.3 million – was sentenced today to 31 months in federal prison.
Today’s sentencing is the second in the past two weeks in which a smuggling operation resulted in a federal prison term. Last week, a Glendale man who brought bogus AMG wheels into the country received a one-year prison sentence.
Both defendants previously pleaded guilty to trafficking in counterfeit goods.
In today’s sentencing, Kevin “Peter” Wang, 54, of Rosemead, was sentenced to 31 months by United States District Judge John A. Kronstadt. In addition to the prison term, Judge Kronstadt ordered Wang to serve an additional six months of home detention and to pay a $10,000 fine and $50,000 in restitution.
Wang helped Chinese exporters bring counterfeit goods – including fake Nike shoes (labeled as “garment hangers”); counterfeit Coach, Gucci, and Louis Vuitton handbags (labeled as “toilet paper”); and bogus NFL, NBA, and NHL jerseys – into the United States. According to court documents, from 2008 to 2012, the counterfeit goods were smuggled in shipping containers through the ports of Los Angeles and Long Beach.
In the second case that led to a prison term, Hamlet Ayvazyan, 37, of Glendale, was sentenced on Monday, April 28, to one year and one day in federal prison. Ayvazyan was sentenced by United States District Judge Margaret M. Morrow, who also ordered the defendant to pay a $4,000 fine.
Ayvazyan, the owner of Speedvision Motorsport in Glendale, imported wheel rims from a Chinese business known as "Shandong Chiping Xinfa Aluminous Product Co., Ltd.," which had offered wheels for brands that purported to be “Audi,” “BMW,” “Mercedes Benz,” “Land Rover,” “Porsche” and “Cadillac."
U.S. Customs and Border Protection officials discovered Ayvazyan's imports in January 2012 when they inspected an ocean container that contained 430 wheels that bore counterfeit Mercedes Benz “AMG” logos, with Ayvazyan and Speedvision as consignee. Undercover agents with Homeland Security Investigations posed as customers and met with Ayvazyan at Speedvision, where Ayvazyan sold to the agents a wheel with an “AMG” logo and placed a center cap “Mercedes” decal on the wheel.
In February 2012, agents executed a search warrant at Speedvision and found 189 additional wheels bearing counterfeit “AMG” marks. Although Ayvazyan claimed that the goods were “replicas,” the marks on the wheels were unauthorized copies of the registered “AMG” trademark. Ayvazyan also kept 2,100 adhesive logos and wheel center caps that bore marks such as “Mercedes Benz” and “BMW.”
Ayvazyan paid approximately $100 for each wheel and sold them for $200, which was substantially less than the manufacturer’s price for legitimate wheels, which was as much as $2,000.
The cases against Wang and Ayvazyan were investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI).
“Trafficking in counterfeit merchandise is a multi-billion dollar global business that robs governments of vital revenues and the industry of its due profits,” said Claude Arnold, special agent in charge of HSI Los Angeles. “HSI is committed to dismantling these schemes because the profits from such illegal ventures often go to fund more criminal enterprises.”
Release No. 14-058
Illegal Alien Sentenced for Unlawful Possession of Identification DocumentsRead the Press Release
An illegal alien who possessed identification documents issued in the name of another real person was sentenced today to two years in federal prison.
Carlos Lopez-Pinto, age 36, a citizen of Mexico, living in Cedar Rapids, Iowa, received the prison term after a February 21, 2014, guilty plea to one count of unlawful possession of identification documents.
In a plea agreement, Lopez-Pinto admitted that on March 2, 2012, claiming to be a U.S. citizen, he possessed and used a Social Security card and its Social Security Number and a State of Minnesota Identification Card to apply for work in Iowa under the name of another real person. Lopez-Pinto knew the Social Security Number had been issued to another real person as he had a copy of that person’s birth certificate. The fraudulent Minnesota Identification Card with Lopez-Pinto’s picture had a fictitious identification number.
Lopez-Pinto was sentenced in Cedar Rapids by United States District Court Chief Judge Linda R. Reade. Lopez-Pinto was sentenced to 24 months’ imprisonment. 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.
Carlos-Pinto 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 Daniel C. Tvedt and investigated by agents from the Department of Homeland Security, Immigration and Customs Enforcement.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 13-CR-97.
Idaho Man Pleads Guilty to Destruction of National Forest LandRead the Press Release
Admits Willful Injury to Property of the United States
COEUR D’ALENE – Stanley D. Votava, 60, of Coeur d’Alene, Idaho, pleaded guilty today before United States Magistrate Judge Candy W. Dale to damaging lands within the Idaho Panhandle National Forest. This is a violation of 18 U.S.C. 1361 and carries a maximum punishment of up to one year incarceration, and $100,000 fine, U.S. Attorney Wendy J. Olson announced. Sentencing is scheduled for August 19, 2014.
According to the plea agreement, Votava had been hired to remove some trees on private land adjacent to the U.S. Forest. While doing this work, he drove his skidder four times through the Idaho Panhandle National Forest causing damage to the forest estimated at over $7,000.00.
The case was investigated by the U.S. Forest Service.
Husband and Wife Sentenced for Selling Methamphetamine in ChapmanvilleRead the Press Release
CHARLESTON, W.Va. – Rodney Wiley, 30, and his wife Opal Wiley, 42, of Chapmanville, Logan County, West Virginia, were sentenced today to 30 months and 18 months imprisonment, respectively, for selling methamphetamine, United States Attorney Booth Goodwin announced. Both defendants, who pleaded guilty in February of this year, previously admitted to selling methamphetamine to what proved to be a confidential informant working with the U.S. 119 Drug Task Force. The meth sale occurred in January 2013, outside the Dollar General Store in Chapmanville. At the time of their arrest, the defendants further acknowledged that they had jointly sold methamphetamine for several months.
United States District Judge John T. Copenhaver, Jr., handed down today’s sentence.
Holyoke Man Sentenced for Embezzlement from Veteran's Administration OrganizationRead the Press Release
BOSTON – A Holyoke man was sentenced today for embezzling $60,000 from the Boston Veteran’s Administration Research Institute (BVARI).
Riccardo D'Orsainville, 48, was sentenced by U.S. District Court Judge Rya W. Zobel to 21 months in prison, three years of supervised release, and $59,979 in restitution. In February 2014, D'Orsainville pleaded guilty to embezzlement and misuse of a passport.
In August 2011, D'Orsainville was hired by the BVARI as a temporary employee. BVARI is non-profit, tax-exempt institute whose purpose is to conduct the medical research and educational activities of the U.S. Veteran’s Affairs healthcare system. D'Orsainville's responsibilities included helping BVARI’s CEO with administrative duties, such as preparing for meetings, writing the minutes for each meeting, collecting the mail, and depositing certain checks payable to BVARI into BVARI's business bank accounts.
In July 2012, D'Orsainville forged the signatures of two BVARI employees to open an unauthorized corporate Citizens bank account in the name of BVARI. Between July 2012 and January 2013, D'Orsainville embezzled approximately $68,336 in checks made out to BVARI by depositing them into the Citizens bank account from which he ultimately withdrew approximately $60,000 for his personal use.
When D'Orsainville was arrested on July 17, 2013, he was in possession of a European Union passport belonging to a British national. D’Orsainville had altered the passport by replacing the passport photograph of the British national with his own. The investigation determined that on June 29, 2013, D'Orsainville used the altered passport to obtain employment at D. Hotel in Holyoke fraudulently employing the name of the British national.United States Attorney Carmen M. Ortiz; Jeffrey Hughes, Special Agent in Charge of the U.S. Department of Veterans Affairs, Office of Inspector General, Northeast Field Office; and Bruce M. Foucart, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations in Boston, made the announcement today. The case was prosecuted by Assistant U.S. Attorney Shelby Wright.
Hartford Man Pleads Guilty to Illegally Possessing Two Semi-automatic RiflesRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that EDWIN CARTER, 51, of Hartford, pleaded guilty yesterday before Chief U.S. District Judge Janet C. Hall in New Haven to possession of firearms by a previously convicted felon.
According to court documents and statements made in court, on November 6, 2013, members of the Hartford Police Department’s Special Operations Group and Shooting Task Force executed a court authorized search of CARTER’s Plainfield Street residence and recovered an FNH PS90 5.7x28 caliber assault rifle with a high capacity magazine containing 15 live rounds, and one Sarko SAR-I (AK-47) 7.62x39 caliber assault rifle with two high capacity magazines, one containing 27 live rounds and the other containing 26 live rounds.
The FNH PS90 assault rifle had been reported stolen out of East Hartford.
Prior to November 2013, CARTER had sustained three felony convictions in the Connecticut Superior Court, including convictions for assault, weapons in a motor vehicle and possession of narcotics. It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.
CARTER has been detained since his arrest on November 26, 2013.
Judge Hall scheduled sentencing for August 18, 2014, at which time CARTER faces a maximum term of imprisonment of 10 years and a fine of up to $250,000.
This matter is being investigated by the Federal Bureau of Investigation’s Northern Connecticut Violent Crimes Task Force, which includes members of the Hartford Police Department, East Hartford Police Department, Connecticut State Police and Connecticut Department of Correction. The case is being prosecuted by Assistant U.S. Attorney John H. Durham.
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